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Lords Chamber

Volume 722: debated on Wednesday 17 November 2010

House of Lords

Wednesday, 17 November 2010.

Prayers—read by the Lord Bishop of Bristol.

Health: Chronic Obstructive Pulmonary Disease


Asked By

To ask Her Majesty’s Government when they will implement the National Clinical Strategy for Chronic Obstructive Pulmonary Disease.

My Lords, the reforms set out in Equity and excellence: Liberating the NHS will ensure that the NHS focuses on improving outcomes for patients. As a result, we are looking at the role and nature of clinical strategies within the reformed NHS to ensure that they reflect this focus.

Today is World COPD Day. I can assure the House that we are committed to improving outcomes for those who suffer from COPD and from asthma. We will make further announcements shortly.

I join the Minister in welcoming World COPD Day, which draws attention to this incurable, degenerative lung condition. However, I am disappointed that he has not thought fit to use today to adopt the COPD strategy, which was left up and ready, as it were, when the previous Government left office. Apart from anything else, I wonder whether he is aware that the British Lung Foundation’s research shows that up to 80 per cent of GPs cannot tell the difference between asthma and COPD. That is a very serious issue for prescribing. The adoption of the COPD strategy would bring systematic training and awareness-raising of this condition.

My Lords, as I indicated in my Answer, the reform programme that we have outlined is intended to ensure that all parts of the system work more effectively in improving health outcomes. That has to include COPD. We have to ensure that everything that we do fits into the proposed new architecture of the NHS. In the mean time, we will continue to work with key organisations and with clinical leads for COPD and asthma to make sure that change happens. I know that a great deal of activity is in hand across the NHS to improve outcomes for patients with COPD and asthma as a result of the good work undertaken so far.

Will the Minister give a pledge on World COPD Day to ensure that the compensation scheme for miners affected by COPD that was begun by the previous Administration will continue?

My Lords, I will be happy to write to the noble Baroness on that matter, as I have not been briefed on it.

My Lords, both my brothers and my father died after years of breathlessness, which is an appalling condition. Can the Minister say why pulmonary rehabilitation courses are being closed around the country, despite being recommended by the NICE guidelines?

My Lords, I am concerned to hear the noble Baroness’s comments because I know that an enormous amount of good work is going on around the country. There are programmes to encourage clinical leadership, improvement projects designed to integrate services, a commissioning toolkit, benchmarking data on outcomes and tools to aid local campaigns. If the services designed to help COPD patients are being diluted in any way, I should be very concerned about that and interested to hear the details.

My Lords, does the Minister recall the recent paper from the Royal College of Psychiatrists that highlights that mental disorder is behind a large number of people taking up smoking and drinking? Will he consider whether this is not an argument for further investment in child and adolescent mental health services, so that children and young people suffering from anxiety and depression receive the help that they need at an early stage and do not reach for alcohol, tobacco and other substances that can have these awful outcomes in later life?

My Lords, I congratulate the noble Earl on linking mental health with COPD in that neat way. He is absolutely right that smoking is an activity that puts one at high risk of COPD and that smoking is closely associated with poor mental health. Fifty per cent of the tobacco smoked in this country is smoked by those with mental health problems. We are determined to continue efforts to discourage smoking in the general population. We are also keen to raise awareness of good lung health generally, which brings us back to the Question on the Order Paper. To a large extent, such efforts will fall to the new public health service in future.

Will the Minister say whether the Government have noted the conclusions of the Environmental Audit Committee in the other place, which reported that poor air quality aggravates and is a contributory factor to COPD? Has the Department of Health been in discussion with the Department for Transport about scaling back pollution as part of the forthcoming paper that the noble Lord mentioned?

My noble friend is right to raise the issue of air quality, which is of concern to my department. She is also right that we are working with colleagues across government to look at air quality—particularly in London but also in other cities—which has such a damaging effect on the health of a number of people.

My Lords, is not the network of breathe easy clubs, which is widely extended across this country, a very good example of the involvement of the statutory and NHS services with volunteers and patient response? Could not that reasonably be said to be a very good precursor to the big society?

My Lords, my noble friend is absolutely right. We have been working with the breathe easy groups and the British Lung Foundation to ensure that the good work that they are doing, along with that of the newly appointed strategic health authority respiratory leads, will improve outcomes for those with COPD and asthma. I agree with him fully that this is a very good example of the big society in action.

My Lords, patients with COPD are classically those who do not get access to palliative care services at the end of life. Will the Minister tell us what the Government will do to improve the access to palliative care of patients with COPD and other chronic conditions at the end of life?

My Lords, the noble Baroness will know that an enormous amount of work is going on with palliative care services, and a great deal of money is being directed towards them. I share her concern that hospices tend to focus above all on patients with cancer, to the detriment of those with other conditions. This is an area that we are looking at very closely.

NHS: Prebiotics


Asked By

To ask Her Majesty’s Government what consideration they will give to using prebiotics to prevent Clostridium difficile in a clinical setting, with a view to improving patient experience and saving NHS resources.

There is currently insufficient evidence to show that prebiotics offer benefits in a clinical setting to be able to make a general recommendation in relation to prevention of Clostridium difficile infection. Of course, we will keep this issue under review. However, it is important for all patients, including those who have contracted Clostridium difficile infection, to have a well-balanced diet.

My Lords, I thank the noble Earl for that answer. Is he aware that C. difficile costs the country about £100 million a year and prebiotics are very cheap? Prebiotics are a food supplement that bypasses the stomach and goes into the gut and helps to keep a person fit, so that they may not get C. difficile. Does he agree that anything is worth trying with such a debilitating and dangerous condition?

The noble Baroness is absolutely right, not for the first time, about the devastating incidence of C. difficile infection. More than 25,000 cases of C. difficile infection are reported annually and there remain significant variations in outcomes among organisations.

In principle, prebiotics should be beneficial, but there is in fact little good evidence to show that they work or that food can provide a prebiotic effect. There is likely to be considerable inter-patient variation in the gut flora response to prebiotics, which could be exacerbated by differences in diet. However, as I have already indicated, we will look closely at the issue.

My Lords, given the difficulties and dangers of Clostridium difficile, can my noble friend reassure me that the Department of Health has noted that the Food and Drug Administration has in recent days approved fast-track designation for a parenteral toxoid vaccine, which thus opens the possibility—I hope—that immunisation will be possible, in particular for elderly, vulnerable people who are in danger of developing Clostridium difficile infection?

My Lords, I am aware of the interesting development of a vaccine for C. difficile, but I understand that the vaccine is still in clinical trials. As my noble friend indicated, the company may be seeking agreement from the US FDA to fast-track the application when the development programme is complete, as that would give them access to the US market. It is of course for the manufacturer to decide when and if it wishes to seek access to the market in the UK and the wider EU.

My Lords, could not a strong case be made for the Department of Health to commission a suitably designed pilot study of prebiotics to see whether they are beneficial in the prevention of Clostridium difficile and other conditions?

My Lords, as I have said, we will continue to look at the matter with interest. Of course the department has a very sizeable clinical research budget, which is open to all bids of a high quality. There is no reason why a bid should not be made on this issue as well.

My Lords, I will try again. Can the Minister tell me whether carbolic—either as a soap or as a cleaner—has any effect on C. difficile, or is C. difficile resistant to carbolic?

My Lords, my advice is that best practice guidance on the diagnosis and treatment of Clostridium difficile infection is clear and is available. The management of the infection requires the isolation of cases, hand-washing with soap and water and the use of the antibiotics metronidazole or vancomycin.

My Lords, the Minister said that there was not enough evidence to be sure that prebiotics are effective. Can he say whether any active efforts will be made to get that evidence, or does he mean that people must wait until a request has been made before such efforts are embarked upon?

My Lords, we regard the departmental budget as being there to enable those who have good-quality and well-designed research projects to bid for those funds. I will take on board my noble friend’s implicit suggestion that the department should pursue the issue but, in doing so, I bear in mind that these products are commercially produced and that it is really for the manufacturers to come up with robust clinical data.

My Lords, is the noble Earl aware that there are more trials on probiotics than on the prebiotics mentioned by the noble Baroness, Lady Masham? Although there are no Department of Health trials that I am aware of, was the Minister suggesting in his earlier response that he is seeking the opportunity for such trials to take place?

My Lords, I merely meant to indicate that we would welcome good-quality proposals. On probiotics, I understand that one study using live yoghurt showed a patient benefit but my advice is that the study methodology was flawed and its findings were not generalisable. Probiotics are not therefore recommended, as studies have failed to show any convincing evidence that they either treat or prevent C. difficile infection.

My Lords, is the noble Earl concerned about the presence of the potentially more aggressive and resistant forms of C. difficile that have been identified in our hospitals? What action is being taken to ensure that they do not spread more widely?

My Lords, the noble Lord is absolutely right. It is appropriate for me to emphasise that, as he will well know, inappropriate prescribing of antibiotics is above all what has caused the high levels of infection that we have seen in recent years. The use of broad-spectrum antibiotics predisposes people to C. difficile infection, so it is important that those in the health service understand the cause and effect relationship involved.

It is also worth mentioning that tomorrow is European Antibiotic Awareness Day, so it is appropriate that this Question has been asked today.

My Lords, I know what an antibiotic is, but can the Minister help me with what a prebiotic is and what a probiotic is?

My noble friend has asked the question, and I hope that he will be pleased with the answer. Prebiotics are non-digestible carbohydrates that act by promoting the growth and/or activity of probiotic bacteria in the gut. The most common prebiotics are fructo-oligosaccharides, inulin and galacto-oligosaccharides. They are found in various vegetables and fruit, such as tomatoes, asparagus and bananas. The best example of a probiotic is yoghurt.



Asked By

To ask Her Majesty’s Government what are their current priorities as they take forward their relationship with Tajikistan.

My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so, I declare interests as serving on the advisory board of the Central Asia and South Caucasus Association at Asia House and as chairman of the British Tajikistan All-Party Parliamentary Group.

My Lords, we value our relationship with Tajikistan and welcome recent high-level exchanges with the Tajik Government. Our priorities are to encourage democratic and other reforms that will help to underpin stability in Tajikistan and the region. We also believe that there is benefit for both sides in working more closely on issues relating to Afghanistan. Parliamentary links form an important part of our efforts to strengthen the bilateral relationship and I pay tribute to the noble Lord for the work that he does to that end.

I thank the Minister very much for that response. The willingness of the United Kingdom to engage more would be appreciated by Tajikistan and so deepen the bilateral relationship. I believe that there are multiple reasons for doing so. Is the Minister aware that they include fully understanding the culture of the Tajik ethnic north of Afghanistan, the potential for extremism to destabilise internally and so reach into central Asia, the fact that this is a major drug route with 1,500 kilometres of open border with Afghanistan and, finally, economic and other sector opportunities for mutual co-operation and benefit?

I thank the noble Viscount for his constructive question. I am aware of the points that he raises. He reminds your Lordships that there is a long border between Tajikistan and Afghanistan and that many Tajik people live in north Afghanistan and play a relevant, decisive and, we hope, fully helpful part in seeking to pacify that country and meet our priorities there. He makes valuable points. Also relevant are his references to the narcotics problem, some of the cross-border trade that has been going on and some of the difficulties with the Uzbek border of the country as well.

My Lords, the distinguished Speaker and leader of the Tajik delegation now in the UK under Inter-Parliamentary Union auspices tells me that the English language is now on a par with Russian in Tajik schools. However, DfID does not see this as a proper tool of development and empowerment of ordinary people; it is in effect given low priority because DfID thinks of the British Council as the main supplier. To what extent will the Government help the Tajik Government in respect of English language teaching in schools and universities and in the training of teachers of the English language?

I am grateful to the noble Lord, who reminds us that there is an important parliamentary delegation in this country led by the respected Speaker of the Tajik Parliament. I know that the noble Lord had the opportunity to meet and converse with this delegation. He raises valid points about language training. Language training does go on; indeed, part of our defence co-operation is that we assist with language training. He is certainly correct that this is a valuable part of the support for the future and something on which we must seek to build. There are obviously priorities for DfID to look at. Indeed, DfID is looking at recurrently reviewing the whole range of its support operations, almost around the world, including those in the Caucasus and in the region that we are discussing. That does not deny for a moment, however, that language training is one of the great exports and assets that we can contribute to peace and stability in the region, which I hope will continue to be the case.

Will the Minister say anything about the insecurities of some of the surrounding territories, with particular reference to the recent political disorders in Kyrgyzstan? For example, what is the position of the BBC World Service and the British mission in Kyrgyzstan?

Although the Question is not about Kyrgyzstan, which is to the north of Tajikistan, the noble Lord is certainly right that the regional issues all impinge on one another. We are still concerned about the terrible violence that went on in Kyrgyzstan back in the summer and we very much hope that the political process can now be reinforced and that a coalition can be built to bring stability to the area. I do not have at my fingertips exactly where BBC World Service activities stand, but the message of independent news delivery, ideally in acceptable languages, is very important. It is an area that concerns us and we hope that the horrible violence of the recent past will not be repeated.

My Lords, is the Minister aware that there has been a moratorium on the death penalty in Tajikistan since 2004? If he is, I am sure that he agrees with me that it is most welcome. Are the Government ready to give support to Tajikistan if requested in taking further these reforms, particularly in relation to reform of the court system and judicial training?

I must say frankly to the noble Baroness that I was not aware of the date of the moratorium on the death penalty, but I greatly welcome it. Indeed, the Foreign and Commonwealth Office and some of my fellow Ministers have been active in carrying this message of, one hopes, the almost universal end of the death penalty to as many areas as possible. It is certainly something that we as a civilised nation believe in and we hope that that message can be spread. As to judicial training and other forms of training and technical assistance, there is a programme of help in that direction. We intend to do more, but there are limits to our resources and we must spread them as effectively as we can. These are valuable additions and we want to develop all kinds of assistance in the best way that we can.

My Lords, I have a quick question. In the past there have been discussions between the United Kingdom and Tajikistan over a double taxation agreement and an agreement on provision of investment on both sides—an investment protection and promotion agreement. Do the Government have any plans to take forward discussions on those important agreements with Tajikistan?

I will certainly look into that. The general level of trade with Tajikistan, as the noble Baroness probably knows better than me, is fairly modest, but we are keen to do more on the commercial and financial side. I will look into the issue that she raised on tax arrangements and write to her if there is more news to tell.

Regional Development Agencies


Asked By

To ask Her Majesty’s Government, in light of the Secretary of State for Business, Innovation and Skills’ comment that the handling of the proposed abolition of the Regional Development Agencies (RDAs) had been “a little Maoist and chaotic”, whether they will now withdraw their proposals to abolish the RDAs.

There are no plans to withdraw our proposals to abolish the RDAs. We fundamentally believe that it is the right thing to do to ensure growth and economic development that meets local needs.

I thank the noble Baroness for her clear Answer, but does she agree that the Government have got themselves into a bit of a pickle—maybe an Eric Pickles brand of pickle—on this issue? Will she clarify whether she agrees with the comments of her boss, the Secretary of State for Business, and if so why will she not withdraw the regional development agencies from Schedule 1 to the Public Bodies Bill and transfer them to another schedule where their great contribution to economic development might be properly considered and assessed?

We will not do that because we know that the system does not work. It has cost a load of money and has taken ages. It has not achieved what it wanted to achieve in the first place, which was to bring the north and the south together, so it is time for change. That is why I am standing on this side of the House and the noble Lord is on the other.

What did my honourable friend in another place mean? He meant that change is upsetting and can be chaotic. Let us face it: if any of us have moved house, we know exactly what that feels like. We have set an ambitious pace for reform and are trying to move at speed to reorganise completely the way in which economic development is targeted and supported locally, where it can really impact on people. In abolishing the nine autonomous organisations, we have set ourselves a challenging task to achieve that by March 2012. Change is upsetting and unpleasant and feels chaotic, but at the end of change we know that what we are doing is for the best.

My Lords, does the Minister agree that, in praying in aid Chairman Mao, the noble Lord, Lord Liddle, is a little out of date? Perhaps, like the Chinese, he might prefer to follow the doctrines of Chairman Deng, who commented that, after all, it does not matter whether the cat is black or white as long as it catches mice.

My noble friend is very helpful. It is worth remembering that the Secretary of State has just been in China doing business for Britain, and we are proud of him for doing that.

My Lords, is the Minister aware that independent research has shown that, under the plans announced by the Government, significant areas of the country will not be covered by the new local employment partnerships? Nearly 21 million people and 780,000 businesses have been excluded from local employment partnerships, with some areas, such as the north-east and the south-west, being very badly hit.

Businesses are also sceptical about the proposals. The EEF—the manufacturers’ organisation—has said that many of the proposals fail to make their mark with manufacturers. Nor did the proposals get a much better press from the CBI director-general, Richard Lambert. For the record, it was not the noble Lord, Lord Liddle, but the Secretary of State who prayed in aid Chairman Mao. Has the Minister taken into account the economic impact of the failure to appoint LEPs in various parts of the country?

We have appointed 24 LEPs, others are coming through and very interesting combinations are coming together. The partnerships are local and are working extremely well, so I do not think that we are doing too badly. It is worth remembering that, when the Liberal Democrats and Conservatives talked to businesses before the election, we were told over and over again that the RDAs were doing no good job whatsoever and that, the sooner they were gone, the better.

Is the Minister aware of the way in which emerging LEP arrangements in the south-west seem likely to separate the great city of Plymouth, which she will know well, from much of its economic hinterland and its travel-to-work area in south-east Cornwall? This is of deep concern to the private sector, on which so much of our economic health depends. What guidance will be given to the new LEPs to ensure effective, wider co-operation between them?

The LEPs are being given a lot of help and guidance. The right reverend Prelate is right, as I come from Plymouth and live in Cornwall. Under the previous Administration, we were being run from Bristol, whereas Plymouth is right on the edge of Cornwall, as the right reverend Prelate knows well. The LEPs will make these arrangements between themselves and the arrangements will work because they are local. Local people are getting things right for themselves locally. We will assist them in any way that we can.

My Lords, I am afraid that Question Time has gone on rather long. We have reached 30 minutes and must move to the next business.

Disabled People’s Right to Control (Pilot Scheme) (England) Regulations 2010

Motion to Approve

Moved By

That the draft regulations laid before the House on 12 October be approved.

Relevant document: 3rd Report from the Joint Committee on Statutory Instruments. Considered in Grand Committee on 8 November.

Motion agreed.

Contaminated Blood (Support for Infected and Bereaved Persons) Bill [HL]

Third Reading

A privilege amendment was made and the Bill was passed and sent to the Commons.

Identity Documents Bill


Clause 2 : Cancellation of ID cards etc

Amendment 1 not moved.

Amendment 2

Moved by

2: Clause 2, page 2, line 5, at end insert—

“( ) giving cardholders the option of being reimbursed £30 on surrendering their ID cards by such a date and pursuant to such arrangements as the Secretary of State considers appropriate”

My Lords, we come to an important amendment, which I hope the Minister will be prepared to accept, to do right by those members of the public who in good faith purchased an ID card. The introduction of ID cards was controversial and subject to intense debate in your Lordships' House. We on this side saw the ID card scheme as a convenient and secure way of asserting one’s identity in everyday life. The card was more affordable than a passport and functioned as a valid travel document throughout Europe, and we saw it as a way of demonstrating eligibility to work and as proof of age for young people or those without a driving licence. The parties opposite disagreed with that principle and in their election manifestos argued for abolition of the cards. For that reason, we have not at any stage sought to oppose the Bill, although in Committee we tabled some probing and constructive amendments, including this one.

The point of my amendment is this. As a result of the introduction of ID cards, 12,000 or so members of the public purchased a card for £30. The cards were for a period of 10 years. As a result of the Bill, should it successfully pass, the cards are to be cancelled within a short time, many years before their due expiry date. That is fair enough; it is a decision of the Government and is why they have brought this legislation to your Lordships' House. What is not fair is the Government’s decision to refuse to refund the £30 to those who purchased an ID card.

I have been rather disappointed by the Minister’s somewhat unsympathetic attitude. On Second Reading, she said:

“We realise that some people who spent £30 for a card with a 10-year life expectancy will be disappointed that it will be cancelled later this year without any refund, but those who chose to buy a card did so in the full knowledge of the unambiguous statements by the coalition parties that the scheme would be scrapped if we came to office. They cannot now expect taxpayers to bail them out”.

She went on to say that,

“citizens have to be aware of what is going on around them. It was clear that this scheme would have a risky future ahead of it”.—[Official Report, 18/10/10; col. 715.]

She then dismissed the potential refund of £30 as,

“rather less than probably most people pay for a monthly subscription to Sky”.—[Official Report, 18/10/10; col. 742.]

The Minister seemed to be saying that members of the public are meant to have a thorough understanding of the views of political parties, make an assessment of who is going to win an election and then make their dispositions accordingly.

I am confused—I do not know whether other noble Lords are. Is the noble Lord speaking to the first and third amendments?

In the flurry of Members leaving, the noble Baroness may have missed that my noble friend Lord Brett did not move the first group. I am talking about Amendment 2.

Even if you were to accept that argument, which I do not, the fact is that there were mixed messages. I shall read an extract from the Daily Telegraph of 24 May 2010:

“Chris Grayling, the former shadow home secretary, had signalled that there would be refunds for cancelled cards”.

So even if you accept the argument that members of the public were meant to read the newspapers to get an understanding of what the opposition parties were saying would happen with ID cards in the event that they won—that even though a member of the public had bought a card for 10 years, it was tough luck—the fact is that the position was not clear in the media and there were conflicting statements.

I encourage noble Lords to think about the wider principle, not just about ID cards and £30. An incoming Government are saying that because they disagreed with the original policy of a previous Government, it is simply tough luck that members of the public decided to act on that policy. They are simply expected to have this right taken away from them without any possible compensation or recompense at all. I think that that is a rather extraordinary principle to adopt. I also think that it impacts on the reputation of governments as a whole. Does the Minister not see that, in refusing to refund the £30, she is really developing a new principle which can only reduce trust in government generally?

I also point out to the Minister that, in the impact assessment which accompanies the Bill, and in the option that the Government believe is the right option, provision is made for the termination of contracts with contractors who were employed to develop the ID infrastructure. Why is it acceptable to recompense contractors but not members of the public? Of course she will say that there is contract law, but this surely goes much wider than contract law.

I would like to quote from a letter that appeared in the Times on 9 June 2010. It states:

“Sir, I received last week an undated letter from the chief executive of the Identity & Passport Service. His letter contained a most extraordinary statement: ‘I am writing to let you know that the Government has announced it intends to cancel the identity card scheme and the National Identity Register. To minimise the cost to taxpayers, the Government has also announced that refunds will not be provided for current cardholders’”.

The letter goes on to say:

“It is beyond belief that a government department can offer a ten-year service to the public, charge a fee and then, after a few weeks, announce that the service is to be withdrawn and no money refunded. Were such an action to be proposed by a private business, it would create an outcry from whichever government department was responsible”.

The letter concludes:

“I believe a large proportion of those issued were purchased, after encouragement by the Government, by young people, to whom £30 is a significant sum. Can there be any possible justification for penalising them in this way?”.

That was from the noble Lord, Lord Levene, and I think that the comments he made in June are as relevant today as they were four months ago. I very much hope that the Minister, even at this late stage, will agree that members of the public who request to have the £30 recompensed will have the money refunded. I beg to move.

My Lords, my name is on Amendment 2. I led the opposition from these benches to the Identity Cards Bill. I spent a good deal of one year of my life opposing it. I am therefore utterly delighted that this Bill is before the House. However, I have to say that, for me, it is slighted by the denial of reimbursement of the fee paid by 12,000 of our fellow citizens when they took out this card. Had they been told at the time they took out the card that they were in danger of losing the card and not being reimbursed, then that would be different. Had the coalition partners in their election manifestos said not merely that they would revoke the whole of the ID card scheme, but not compensate those who had taken cards in the interim, then that would be different. But neither of those circumstances prevails. I really do not think that it is remotely acceptable, for the reasons which the noble Lord, Lord Hunt of Kings Heath, laid out in moving the amendment. It simply is not acceptable to say, “Ah, but they should have realised”, which is what it boils down to.

Governments must set an example of the standards they expect of private industry. Had private industry engaged in a tactic of this sort, noble Lords on all the Benches would have been up in arms, and rightly so. I feel probably more strongly than I ought to that there is a simple, basic issue of fairness in this. Since this coalition launched itself as a coalition on the basis of fairness, I felt compelled, contrary to the wishes of my Whips, to put my name to this amendment, and I have done so with some conviction.

My Lords, I support noble Lords who have spoken. Will the noble Baroness tell the House whether she disputes that the card is property for the purposes of Article 1 of the First Protocol to the European Convention on Human Rights? Its cancellation is therefore a deprivation of property and compensation is payable. It would be most unfortunate if those whose cards are being taken away need to litigate this matter.

My Lords, unlike the noble Lord, Lord Phillips, I supported the introduction of ID cards. I still oppose this Bill in abolishing them. But certainly I think that the Government are being very petty in terms of refusing compensation to those who bought the cards, particularly as it appears that they are paying compensation to contractors which supplied machinery, software and everything else to set up the ID scheme. They will be paid full compensation. The argument is that they have a contract between the Government and them.

I would argue that the people who bought ID cards equally have a contract between themselves as individuals and the Government from whom they purchased the card. If that is the case, they are as much entitled to compensation as the companies which are being compensated for loss of earnings and profits as a result of the card scheme being cancelled. Will the noble Baroness spell out exactly what compensation is being paid to these companies? I gather that the computers holding the information will be physically smashed up. Will she also include the cost of that smashing up? There must be a cost to the public purse involved in all of that. Perhaps the noble Baroness will spell some of that out during her speech.

My Lords, the people who hold these cards, and there were not many of them, were inveigled into getting them on the basis that the scheme would go ahead and eventually would apply to everyone. In fact, they were helping the Government out. Although it was not this coalition Government, it was a Labour Government. Nevertheless, those people had every reason to trust the Government and trust a future Government to give them some recompense if the system of ID cards did not go ahead.

I have to say to the noble Baroness that the coalition is in need of support at the present time. Would it not be in their own interests to show good will and to show that they are cognisant of people’s feelings and do not want them to feel offended? Would it not, for a small cost, be better if the Government supported, or accepted, this amendment, which might do them some good electorally? You never know.

My Lords, Amendment 1 was not moved not because the Minister convinced me in Committee of her arguments on cost and complexity. The complexity seemed to be manufactured and the cost involved figures that I could not recognise; nor could anybody else who studied it, given that banks issue cards every day of the week gratis and do not expect it to cost a tremendous amount of money. On the other hand, I was convinced by the noble Baroness’s determination not to move on the issue and not least by the discourtesy shown—not that I blame the Minister for this, because she has always been courteous. But I asked two questions in Committee and I did not get the courtesy of an answer. I indicated that I was happy to accept the answer betwixt then and Report. I asked whether the Government had consulted the Government of Gibraltar, who issue travel cards and replace them at very little expense for the same kind of number as the 12,000 that have been issued in this country to people who are not airside workers. I also asked how many ID cards from different countries were accepted by the UK Immigration Service at British ports and airports. I did not get an answer to that, either.

But those unanswered questions were not what determined me not to move Amendment 1. I thought that the moral high ground was rather greater on Amendment 2 than on Amendment 1. Amendment 1, although it was justified in my view, would have applied to a number of the 12,000 people and it would have pre-empted consideration of Amendment 2. Amendment 2 applies to everybody who voluntarily applied for a card, meaning that they at least would have the consolation of the restoration of the money they paid. For me the most telling argument for why this should happen concerns the impact assessment that the Government carried out. The civil servants who drew up that impact assessment put as the case for refunds that a non-refund would mean a reputational loss to the Government—a reputational loss for the sake of £400,000. I said in Committee and I say it again: the reputation of any democratic Government in this country, of whatever source, colour and coalition, has to be worth £400,000. It is de minimis in departmental budget terms and infinitesimal in national budget terms, but not to those 12,000 people, many of whom are elderly or very young. Business people might use the card for travel, young people would like the card because it would get them into places where they needed to carry their passports, such as clubs and pubs where they had to prove their age, and elderly people could use it as a travel document although it was also a document of some cost.

It seemed to me that the Minister was saying that if you are wealthy enough that £30 does not matter, you will not complain. Ipso facto, if you are poor and you do not complain, you will suffer in silence. Again, for the sake of £400,000, 12,000 people who voluntarily believed the Government of the day are being betrayed by the Government that followed them. I do not believe that any Member of your Lordships’ House or the other place can sit easy when this happens and we have the opportunity with this amendment to remedy it.

My Lords, I am equally concerned that for the sake of a very small amount of money the Government are taking this intransigent attitude. That is assuming that 12,000 people will be seeking £30. I very much doubt whether everybody who has paid their £30 will in fact be doing so, so the sum is probably rather less than the noble Lord, Lord Brett, was talking about. I wondered, as a sort of compromise, whether it would not be possible for those who had paid their £30 to be allowed to offset it against the cost of their next passport so that the cost of their passport is reduced by that amount. That might in some way alleviate this disheartening feeling that everybody seems to have about this rather abrupt and unfair arrangement.

What is being done here is to deprive the identity card of value by the main provisions of this Bill. For the people who have paid for the card that is something that we really have to take into account, having regard to the Government’s situation at the time they took out the card. I suggest to my noble friend that this matter should be subject to further consideration. There is an opportunity to do that if my noble friend is willing.

I spoke on this matter in Committee. I agree with the noble Lord, Lord Brett, because I see that the card could still have some use. Although the national identity register, which is what we all objected to, has been removed, having a bit of plastic as a travel document to get around Europe would have been useful and still might be. Some of the 12,000 people concerned bought the card for that. Like the noble and gallant Lord, Lord Craig, I certainly think that those people who thought that they had bought a plastic passport should be allowed to offset it against the cost of getting the more expensive passport that they will now require to go to Europe. For them, it was effectively a cheap way of getting a passport if you needed to travel to Europe.

We penalise insurance salesmen for being more honest than this. The Government are guilty of misselling. They went out and sold the card hard as having lots of benefits, and so people took it up. If you expect a member of the public, seven months ahead of the general election, to be able to predict its outcome, there are a lot of geniuses among the public whom we ought immediately to recruit to become pollsters. They may be all the people who did not buy the card. To me, it looks vindictive and nothing else. This matter could be a PR negative for the Government—a little spark that could catch the newspapers’ imagination. They will find someone who feels really hard done-by. It will get blown up; it will be in the Daily Mail, which will say that something must be done about it, but it will be too late by then.

I know that civil servants will produce reasons for the refund being difficult to administer et cetera. I cannot see the problem in saying, “The only people who get refunded are those who turn up with a card. If you hand in a card, you get 30 quid”. It would be as simple as that. That would not be very expensive to administer. If the Government wished to give the contract to one of the large systems integrators, however, they would end up with a bill for about £5 million, because it is their job to make sure that partners in America are well satisfied with lots of dosh. They are the people whom the Government will have to pay at the end of all this. They will have had unbreakable contracts, so they will have to be paid several million pounds for breaking the contract. A large slice of that will end up in American partners’ pockets. The poor old citizens of this country will get absolutely—I will use unparliamentary language if I go on.

I agree with the noble Lord, Lord Pannick, and said so in Committee, that this is an expropriation of property, or certainly property rights. Even if the card belongs to the Government and is non-transferable, that card gave you rights—that is what they sold it on. I am quite sure that that is expropriation and that there could be a claim under the ECHR. It will go on top of the Digital Economy Act, which we were advising the Government against the other day. So they will have a nice time in the courts.

If I had been lucky enough to get a card, I would have kept it as a collector’s item, but I know that a lot of people would not like to do so and would like their 30 quid back. They are better Scotsmen than me.

My Lords, I share the disquiet of many who have already spoken. I urge the Government to think again about this.

Perhaps I might concentrate on why people bought the card in the place. If they bought it, as it seems, for a purpose, and that purpose no longer obtains, there is no doubt that we are taking away something from them. Surely, therefore, the answer is not to recompense them but to enable them to continue for the period of the card’s validity to be able to do what it is they bought the card for in the first place. That is a sensible and proper way of doing it. Like the noble and learned Lord, Lord Mackay—though I may express myself in less elevated language—I feel that the public have every reason to believe that, if they buy something from the Government for a period of time, they should be able to continue to use it in that way. Whereas recompense is an expensive and untidy way of doing it, I really do not see why they cannot go on using it for the time that they were supposed to use it for.

I must apologise to the noble Lord, Lord Hunt, for interrupting him. I think that the technical term for what was going on around here is “kerfuffle”.

I will not pretend that I have not been troubled by this issue. I am not persuaded by arguments that members of the public should have read the manifestos, certainly not in the detail that might have been expected, nor that they could have predicted the outcome of the general election. I am being told that everybody should have been reading the manifestos, but we leave it to the press to summarise them. However, the debate in Committee was about fine detail in the manifestos, and I do not think that that should be used as the basis—certainly not the only basis—for the Government’s argument.

My view is that this issue is finely balanced between taxpayers and individual cardholders. It is not the same as a consumer situation where there are two parties, the supplier of goods and the purchaser of goods. There are three parties, and the third party is the taxpayer. I understand the point that this is a comparatively small sum of money, but comparatively small sums have more value than they did a year or two ago.

The point has been made about whether this would be expropriation. That point was not taken up by the Joint Committee on Human Rights. No doubt the Minister will say something about that. I hope, too, that she will say what would be required if the cards were to go on having a use. As I understand it, it would still be necessary to retain the register. Otherwise, the cards are pieces of plastic that do not relate to anything. Quite apart from our objection to the offensiveness of the register, the cost and perhaps the confusion of retaining the register would be issues.

My Lords, I am sorry to speak from this side against the clause, but I believe that it is morally indefensible. It is not just that it is a small sum of money, so it is particularly stupid not to pay it, but, as has been said, this sort of thing does the Government—any Government, those of the ruling political class—absolutely no good. The public will say, “They are just not to be trusted. They just can’t do things fairly”. Whoever was the civil servant and others who put up the suggestion that this money should not be compensated or that the card should not be used, I beg them to think again. We really cannot endorse something as shabby as this.

My Lords, I have taken no part in the debates concerning the Bill. Indeed, when I came in here this afternoon, I did not think I was going to take part in it today. However, I have listened to this debate and I find myself in total agreement with the noble and learned Baroness, Lady Butler-Sloss. It seems to me that, from looking at this as objectively as one can, this is an issue about the continuity of government. The identity cards were not sold on the basis of, “You are buying it from a Labour Government, but if another one come in, things may change and you may have to renegotiate it”. The contract—if it was a formal contract—was with the Government, and it is the Government who are now reneging on the contract. I feel very uneasy about it and I hope the Minister will take this back and have another look at it. It is interesting, listening to this debate, that the only person, I think, who has suggested that what the Government are proposing should take place was the noble Baroness, Lady Hamwee. Everybody else seems unanimously against the Government’s position. There is a famous dictum about a hole—I do not need to repeat it. This seems to be an occasion when the Government should think very hard.

My Lords, I would like to raise a further issue which relates to the wording of the amendment. It requires the surrender of the ID card for there to be a reimbursement of £30. There may well be a category of person who would like the £30 back and feel entitled in law to get the £30 back but who actually wants to keep their ID card. Of course, there is a further issue here, which may have struck a number of us. With only 12,000 or so cards in circulation, the residual value of the identity card in future might well be a great deal higher than £30. So the question may arise of how many people with an eye to the future would be keen to get that £30 back now but to retain their identity card. Some further examination of these and other issues might be helpful.

My Lords, I recognise the strength of sentiment expressed on all sides of the House. If the House will permit, I shall explain why I cannot accept the amendment.

The Government set out at an early stage that they would not continue with this legislation and that they would repeal the Bill. That has been the long-standing position of the Government, well known in advance. It is fair to say that the Government made their position known on the fact that the ID cards would no longer have any validity.

The noble Earl is quite right. It has always been the intention, whether in opposition or in government, to scrap the ID cards scheme at the least possible extra cost to the taxpayer. Our primary purpose has been to prevent further expense being incurred when we can avoid it. We have no option but to pay compensation to some contractors because we are tied in by the contracts negotiated by our predecessors. That is a contractual agreement, and we are negotiating at the moment what that final sum should be. We do not agree that there is a contract between the Government and cardholders who received a service, nor do we believe that there is any expropriation of property or rights under it. The cardholders are not card-owners; the noble Lords who said that the card was government property were quite right to say so.

I hear what the noble Baroness has just said about the card being government property. Is she saying, therefore, that it would be illegal for a person who had that card to use it in any way for identity purposes? In other words, if a young person was asked for ID in a pub who still had their ID card, if they produced their ID card would they be committing an offence by using a government document?

I think not, any more than if one uses a passport for that purpose, which is also a government document. The basis is the same.

But the passport is being retained. It is still going to be a legal document, whereas presumably the ID card, once it is abolished, ceases to be one.

If it is a valid document, it can be used validly for identity. If it is an invalid or cancelled document, obviously it no longer has any legal status.

Under Clause 6 about the possession of false identity documents, does the ID card once it has been revoked become a false identity document? That was the point that the noble Lord was making. It is government property and it is no longer an identity document, so in using it you are probably using a false identity document.

You are certainly no longer using a valid identity document. It is not any longer valid in law.

The Identity and Passport Service has estimated that the cost of cancelling the ID cards scheme and the national identity register will be up to £5 million. This includes an estimated figure for compensation to the contractors, which I have just mentioned, destruction costs, staffing and other administrative matters. They are all necessary costs that we cannot avoid in abolishing the scheme. A refund scheme would add 10 per cent to that cost, which we do not consider to be a trivial addition.

Noble Lords have talked about principle. One can look at that in several ways. One of the principles that seems to be on offer this afternoon is that one set of taxpayers should refund another set of taxpayers. This does not seem to be a sensible arrangement. Some say that the sum is only about £400,000—one of the noble Lords mentioned that sum—the inference being that in the grand scheme of things this is entirely insignificant. Certainly, compared with the cost of the ID card scheme that has already been paid out—over £290 million—another half a million pounds might not seem significant. That is not, I am afraid, the attitude that the coalition Government take to public spending. We have demonstrated that we have a commitment to ensuring that unnecessary and unjustifiable expenditure is stopped and that we focus on delivering more for less. We are not therefore in a position to offer this refund.

I am listening with some puzzlement. I am not a lawyer, but the Minister has signed off this Bill as being compatible with the convention on human rights. Yet this identity document is the possession of the Government—it is a government-owned thing—and she is confiscating it without compensation. Would it not be wise to take legal advice as to whether she would face a legal challenge if she went ahead with this?

As I have just said, we do not believe that we are expropriating anybody of their rights. If this is challenged in the courts we will obviously defend that position.

May I follow that point? The Minister has made the proposition that there is no right in contract by the cardholders and no expropriation. On the assumption that no advice has been obtained from the law officers on these matters, would it be prudent before the next stage of the Bill to obtain such advice?

I am not sure that I can confirm that. I will seek to do so before Third Reading.

We should not exaggerate the significance of all this. Much has been made of the elderly and the very young. We have no reliable demographic information at all on who the purchasers were. We know that 3,000 of the 15,000 were given free to airside workers for a particular purpose.

The noble Baroness is getting into the complexities and numbers of this. Is this not a matter of simple principle, irrespective of numbers? If the noble Baroness buys a good or a service and the merchant or other supplier who sells that to her fails to deliver it, she would feel cheated. If that merchant got away with it, she would feel that that undermined the good faith on which the economy and society depend. Is it not a fact that people have in good faith bought a service for 10 years, and after a matter of months, that service is being unilaterally withdrawn? Are people who have done that not entitled to feel thoroughly cheated? Is this not a disgraceful example for a Government of this country to give?

The point I was answering before noble Lords intervened was the inference somehow that we are inflicting great hardship on cardholders. We do not believe this to be the case.

We do not believe that the statutory basis of the issue of ID cards creates a contract or anything akin to a contract in relations between the Secretary of State and the cardholder. Remedies that would be available in the courts if the contract were governed by the law of contract or consumer legislation—which I think is the point raised by the noble Lord—is not available for identity cards.

One or two noble Lords have raised the issue of compromise and of whether it would be a good idea to have one. Could we not, for instance, set the cost of this against the cost of the next passport or, indeed, use the lifetime for which the present card was available? There are associated problems. I do not want to detain the House extensively on this, but the fact of the matter is that the two databases—that is to say, the identity register and the passport database—are not the same. They contain different information, issued for different purposes; their legislative frameworks for what you pay are also different. We cannot therefore simply transfer the one across from the other.

That construction of two differently governed databases with different information on them was the construction of the legislation put through by our predecessors. Unfortunately, in addition to that we are going to destroy the database. We would otherwise have the continuing cost of maintaining it. That is why it cannot be regarded as a valid document for its lifetime; there is nothing behind it against which anybody needing to check your identity would validly be able so to do. There is a problem in that it simply is not a useful document any longer.

I understand that there may be technical reasons why my proposal does not work, but surely they do not apply to the question of a passport. If you sent your form in, it would be quite clear from all the other documents that that little card was for the same person who sent in the form. You do not have to look it up on the two databases; you just know that that is one of the cases in which they could have £30 off. I do not see that that costs anything at all.

I am sorry; I thought that the noble Lord was suggesting that this card should be available for use during its previously indicated lifetime. It is of course a separate issue as to whether you could ask for a refund. There are many problems about the refund issue, one of which is that we would have to verify whether the person presenting a card was actually entitled to that refund, which would mean referring to the database. We would have to notify everybody. The costs involved—

I will be brief. There are times when we have to look at Civil Service advice, good and honest though it is, and apply a political judgment to it. Sometimes it is clear that, in terms of both the justice of the case and the political risk and pain of humiliation, we have to override Civil Service advice. To avoid further pain and agony to the House and to the Minister, I urge her to withdraw and say that she will look at this again.

In answer to an earlier intervention regarding the position of the law officers, my noble friend said that she would look at that and return to it on Third Reading. Since it would be helpful to have the law officers’ advice, which at the moment we do not have, would there not be a strong case for deferring this matter until Third Reading, at which point it would be clear?

My Lords, I said that I will indeed confirm the advice that we have received on the legal aspects.

I want to make one final point before concluding: I am not sure whether the concern which has been expressed in this House is entirely shared by the public. Much has been made of public attitudes but, against the background of 15,000 cards having been taken out, we in the Government have received a grand total of 297 letters on the subject, of which 122 included complaints about refunds. That is 122 against 15,000. We should bear in mind that that is against the background of sending letters to all individuals who had taken out a card when we came into office, so one cannot say that they were uninformed about what was going to happen—that they would not be receiving a refund, because that is what we told them. That letter is also in the Library. So—

I regret interrupting the Minister again but it really is crucial, if I may say so, for her to draw a distinction between information given to people before they purchased their cards and information given to people after they purchased their cards. Therefore, I hope that she will not lay any stress at all on what she has just said.

My Lords, I understand that difference. I am saying that all 15,000 cardholders were informed specifically and in terms that these cards would be withdrawn, that they would not be valid thereafter and that there would be no refund. We have had 122 letters of complaint, not necessarily all of them from actual cardholders. I do not think that that indicates a very high level of concern about £30. One has to take into account—

The House is listening with some incredulity to the defence the Minister is making of a mere £400,000 recompense. Today, the Chancellor has assured the Irish Government that he will give them £7 billion of support and here we are in the House of Lords talking about recompensing British people £400,000. It is complete and utter nonsense, if I may say so to the noble Baroness. For her own sake and for the sake of the Government, will she not at least say to the movers of this amendment and to the House, “I have listened to what you say, I will take the matter away and reconsider it and we can come back to it at Third Reading”?

My Lords, support for the Irish Government, the national interest, the economic prosperity of this country and the welfare of Ireland are quite different matters. I do not think that we can ignore the very low level of public interest in and reaction to the Government’s decision. The House should take note of that. I have tried to deal with compromises. They do not work; otherwise one might be able to do something in that respect.

I ought to deal with the points made by the noble Lord, Lord Brett. I apologise to him that he did not receive an answer earlier. We have not consulted the Government of Gibraltar, who issue their cards in a rather different way. The Identity and Passport Service is not able to answer that question directly. The UKBA is the agency which sees the documents of EU cardholders. We will have to get further information on that point, which I will endeavour to do for the noble Lord.

In light of the views that have been expressed in the House this afternoon, I propose to take this amendment away and consider it.

Before the noble Baroness sits down, will she guarantee to come back with an amendment along the lines of recompensing people? On two occasions the Government have promised to take a proposal of mine away—this Bill has only one more stage—but at Third Reading have weaselled out of it at the last minute. Under the rules governing Third Reading, we are not able to put down anything at that stage to ensure that the Government come back with something, so we need a binding commitment from the Government to come back with an amendment along the lines of this one. If the Government will not give such a commitment, we should not permit the amendment to be withdrawn.

I see the position in which my noble friend finds herself. I respectfully submit to the House that it would be perfectly reasonable for her to ask that this matter be postponed to Third Reading so that she has an opportunity of conveying to her colleagues—because the Government as a whole are involved here—the sentiments that have been very clearly expressed in your Lordships' House. She has explained the reasons for the Government's position. However, a great deal has been said here and I submit that the Government have an opportunity to reconsider. If the Opposition are anxious to achieve fairness and justice, I am sure that this is the correct course, rather than seeking to take the matter further at this juncture—if my noble friend is prepared to take this back, to have it considered by her colleagues in government and to return at Third Reading and tell us what the situation is.

My Lords, I will pick up the point made by the noble Earl, Lord Erroll. It might help the House if my noble friend were to say that the Government would have no objection to similar amendments being tabled again at Third Reading, so that the matter could be deliberately left open to be considered again then.

My Lords, I say to the government Front Bench that we are out of order. It is the job of the Front Bench on the government side to make sure that we keep to order.

Perhaps I may just say that I have undertaken to take the point away. I have done so in good faith and noble Lords may rely on my good faith.

My Lords, I say to the Minister that her good faith is not at issue at all. The issue is whether it is possible under the rules of the House to bring back at Third Reading an amendment that has been moved on Report. I would like advice from the Clerk because, with great respect to the noble and learned Lord, Lord Mackay of Clashfern, I do not think that that is within the rubric of the House.

It is not me to give this advice, except in response to what my noble friend has asked. However, as I understand it, it is certainly within the rules of the House to bring back the matter at Third Reading if it has not been decided before that.

My Lords, I understand that there are anxieties around the House. The House is self-regulating, unlike another place, and some noble Lords today have been venting the habits of another place.

My Lords, there have been interventions on Report that have not been in the customary style that we have had in the past. There are Third Reading rules that enable the Government to clarify remaining uncertainties. Where a Minister has in good faith given an undertaking to take away a matter and look at it again, they are able to do so and bring it back at Third Reading. The Minister may also have discussions with opposition and other Peers on how best to deliver that. Certainly, I would be prepared to take further advice between now and Third Reading to enable my noble friend to carry out her commitment. Of course, it is for those who tabled the amendment to decide how they wish to proceed today. My noble friend has given a commitment to look at the matter again. I know that she has also given a commitment to reflect on particular advice. That is where we have reached.

Third Reading guidance is straightforward. Paragraph 8.145 of the Companion states:

“The practice of the House is normally to resolve major points of difference by the end of report stage, and to use third reading for tidying up the Bill ... The principal purposes of amendments on third reading are … to clarify any remaining uncertainties … to improve the drafting … and to enable the government to fulfil undertakings given at earlier stages of the Bill”.

In response to my noble friend Lord Phillips, that means that my noble friend has given an undertaking, as she has today, to look at this matter again. She will do so. She does not, as the noble Earl, Lord Erroll, requires, have to give a commitment today as to the precise amendment that may or may not be brought forward. These are the normal rules of procedure.

My Lords, I have listened very carefully to what the noble Baroness has said on this matter, and I am in some difficulty because the noble Baroness and I are now the usual channels. There are no longer three; there are two of us. The noble Baroness will know that we have met on many occasions to discuss whether it is in order for noble Lords to table an amendment at Third Reading that was previously moved in Committee and on Report. We need something rather clearer than we have had so far this afternoon. We need an assurance that if this matter cannot be resolved to our satisfaction—and I think that the House is very much behind the amendment in the name of my noble friend Lord Hunt—then we can bring back precisely this amendment so that this House can quite properly determine this issue on the terms in which it has been set out this afternoon for the benefit of your Lordships.

My Lords, this is a matter for resolution in the normal manner, which is that usual channels discuss these issues. I understand, as Government Chief Whip, that it would be appropriate for the Opposition to bring forward an amendment if they felt that the government amendment or failure to act was inappropriate. These are the matters that are discussed in the usual manner; as the noble Lord, Lord Bassam, says, we have had these discussions in the past. It may perhaps assist the House to recall that over the last few months the Public Bill Office has on two occasions advised Opposition Members that they may table Third Reading amendments to take forward matters that have been debated on previous occasions. We do enjoy a fair amount of latitude—I say fair because it is fair to all—within the overall context that Third Reading is not intended to open new issues.

My Lords, I have heard with a great deal of interest the comments from the Captain of the Gentlemen-at-Arms, the Government Chief Whip and the Minister. This matter has been aired at Second Reading, in Grand Committee and now on Report; this is the third time we have debated these issues. While great eloquence has been brought to our debates, no new argument has been brought. The noble Baroness has said, finally, at the end of a long debate—and I suspect rather reluctantly—that she will take it back to look at again. Frankly, in view of the debate, that is not good enough: it is quite clear that the House requires the Government to change their mind. Not much purpose is served by yet more agonising. The House is quite prepared to come to a view and I wish to test its opinion.

Amendment 3 not moved.

Amendment 4

Moved by

4: After Clause 3, insert the following new Clause—

“Report on costs and savings

(1) The Secretary of State must, within 4 months of this Act coming into force, lay before Parliament a report setting out the costs and savings associated with cancelling ID cards.

(2) The report laid under subsection (1) must, in particular, specify—

(a) the costs associated with cancelling all ID cards and sending letters to cardholders under section 2(3),(b) the costs associated with destroying information in the National Identity Register under section 3, and(c) any savings identified as a result of cancelling ID cards and destroying information in the National Identity Register.”

My Lords, the amendment is fairly straightforward, and I hope that it will be seen as a much-needed addition to the Bill. Conservative shadow Ministers when in opposition made varying claims about the current cost of the ID card scheme which ranged widely from nearly £1 billion to up to £20 billion. Meanwhile, the National Identity Service cost report of October 2009—the official document laid before Parliament under the terms of the Identity Cards Act 2006—stated that the projected forward cost of providing ID cards for the next 10 years until 2019 was £835 million. Crucially, that figure does not equate to the savings to be made from scrapping the scheme. We know that because we read the impact assessment that accompanies the Bill, which states at the bottom of page 4:

“The October 2009 cost report indicated that cancellation of ID cards would avoid future costs of £835 million up to October 2019. However, these costs are planned to be recovered through future fees to ID card purchases. Therefore, there are no benefits to the taxpayer from Year 3 onwards”.

The tables included in the impact assessment reveal that total savings from scrapping the scheme are £118 million. The total cost of cancelling the ID cards and the NIR are given as £22 million, although the Bill’s Explanatory Notes state the cost to be £55 million. There appears to be a muddle and the Government have been rather misleading to claim the scale of the savings that they have done. A definitive, preferably independently audited cost and saving report would be desirable and it would be appropriate for it to be part of the Bill. I hope that the noble Baroness will consider this matter as sympathetically as she can.

The Government certainly agree that it is important that we are open and transparent about costs and savings. Ministers have set out the level of costs, both in the debate here and in the other place. Clearly, the Opposition do not entirely agree with our figures, but we have set out the costs and savings as we see them and as they are expected to be over the spending period. We also agree that it is important that these are set out in an accountable and auditable form and that is why we are including the costs and savings associated with scrapping the ID card scheme in the annual report and accounts—we have already undertaken to do this—which will be submitted to the House of Commons by the chief executive of the Identity and Passport Service.

Noble Lords will be aware that the annual report and accounts are presented to the House of Commons in accordance with Section 7 of the 2000 Act and they are published by the House of Commons. The accounts are aimed at being published in advance of the Summer Recess. If one looks at the noble Lord’s amendment, one can see that the timings are such that we would be invited to publish the same information twice over a very short time. I do not think that that makes a great deal of sense.

I can confirm to your Lordships that there will be a full and transparent breakdown of the costs and savings related to ID cards in the IPS annual report and accounts for the next year and that these will cover the points raised in the amendment so that there will be complete clarity on the points that noble Lords have raised. Accordingly, I invite the noble Lord to withdraw this amendment.

I am grateful to the Minister. She has said that the details that I require will be published and I am very happy to accept that assurance. I beg leave to withdraw.

Amendment 4 withdrawn.

Amendment 5

Moved by

5: After Clause 5, insert the following new Clause—

“Identity fraud

(1) The Secretary of State must lay before Parliament a report on the impact of the repeal of the Identity Cards Act 2006 on combating identity fraud and the lessons learnt from the operation of the identity cards scheme.

(2) The Secretary of State must lay the report before Parliament within one year of the coming into force of this Act.”

My Lords, this amendment calls on the Government to produce a report on the impact of the repeal of the Identity Cards Act on combating identity fraud and on the lessons learnt from the operation of the scheme. Identity fraud is one of the UK’s fastest growing crimes, with nearly 2 million people a year falling victim, and figures suggest it costs the country some £2.7 billion a year. More than nine out of 10 people in the UK consider themselves to be at risk from identity fraud. According to the Government’s own fraud prevention service, in the first three quarters of this year, levels of identity fraud increased by almost 10 per cent when compared with the same period in 2009 to nearly 80,000 cases. Any Government obviously have a duty to address this concern and to obtain whatever information is available to ensure that they have an up-to-date and coherent plan for action in this area.

Minimising the paper trail of one’s identity details is key to facing the threat of fraud, and it should be acknowledged that ID cards helped to do this. The ID card scheme did not, of course, offer a panacea in addressing identity fraud, and in cases of identity fraud committed online, for example, the ID card did not offer added security. The Minister told the House at Second Reading that an action plan was being developed by the National Fraud Authority and the National Fraud Intelligence Bureau following their strategic assessment of the harm caused by the impact of identity crime and that it was being overseen by the Home Office. I hope that the Minister will be able to give us an update on the progress of the development of the action plan because it should surely take account of the impact of the repeal of the Identity Cards Act 2006, which is provided for in this Bill, on combating identity fraud and the lessons learnt from the operation of the scheme, particularly in the light of the statement in the Government’s impact assessment that there would have been benefits in relation to identity fraud.

The evidence given to the Committee in the other place on this Bill from the representative of the Manchester Airports Group referred to benefits from the scheme, not least that people were absolutely sure under the scheme that the person who was standing in the pass office was the right person. The witness said that he thought the benefits might be able to be achieved by other means and that some of the innovative ideas in the identity card scheme could be replicated using the passport database or something similar. He believed that if there was a will to do that, it could be done, but at the moment, he did not actually feel that the will was there. Such observations also suggest that there would be a real benefit in having a report on the issues referred to in this amendment and in this work being taken into account in the action plan that, as we understand it, is being developed or subsequently being taken into account.

In the impact assessment that came with the Explanatory Memorandum to what was the Immigration (Biometric Registration) (Amendment) Regulations 2010, the Government were quite clear on the benefits in this area of the residence permits for third-country nationals who are subject to immigration control and who have limited leave to stay in the United Kingdom. The biometric immigration document issued under the regulations takes the form of a card with a chip containing biometric data—namely, fingerprints and a digital facial image. That impact assessment states that among the key monetised benefits of biometric residence permits are a reduction in benefits fraud, enhanced security of the individual’s personal information, an easier method of evidencing an individual’s rights and entitlements and an improved ability, as it puts it, to check for impostors. That impact assessment also states that it was intended that the additional information that would be provided by recording of biometric data under that regulation could be made available to other bodies, such as the police, within the limits of legislation and would help reduce crime. The impact assessment went on to say that the new permit arrangements also enable checks undertaken when a person applies for a residence permit automatically to identify individuals who have previously had their biometrics recorded and who are now claiming to be someone else.

The Government do not have any difficulty in identifying very clearly the benefits in combating fraud and false identity claims and, indeed, in crime generally in relation to biometric residence permits, and it should therefore not be very difficult for the Secretary of State to have a report produced on the impact of the repeal of the 2006 Act by this Bill on combating identity fraud and on the lessons learnt from the operation of the identity cards scheme. There is surely real potential in taking a close look to ensure that the potential benefits from helping to address identity fraud offered by the identity cards scheme are not lost and that lessons learnt from the operation of the scheme are taken on board. I very much hope that the Minister will feel able to accept this amendment, which I move, as it is clearly in everyone’s interest to gain as much information as possible from the operation of relevant schemes in the fight to combat identity fraud.

My Lords, I wonder if, when he comes to wind up, the noble Lord, Lord Rosser, could be a little more explicatory—for want of a better word—on the meaning of Amendment 4. Presumably, he is talking about the costs and savings incurred. We have just had a very long debate on the subject—

My Lords, perhaps the Minister could confirm that he would be happier—I am not quite sure that I took this from his speech—for such lessons as there may be from a relatively short and limited experience to be included in the wider work that the Government are doing. Of course, one would not disagree that any available lessons should be learnt; but I doubt whether that work is as useful to Parliament if it is provided separately and discreetly from other work being done on cyber crime and related areas. It is an enormously important area and Parliament will look forward to debating it further. I am not convinced that this is precisely the way to go.

My Lords, at Second Reading of this Bill, I suggested that, while at the moment an identity card would not help to stop fraud on the internet, it will come. There will eventually come a point when, in view of the rising number of people purchasing goods and services online, the banks and the people selling goods will insist that there is some form of identity involved in the transaction. Whether it will be putting a card into your computer or a camera that will show that you actually are the person, I do not know, but I would think the banks in particular will insist on this in the longer run, both for their own hole-in-the-wall cash machines and for buying online. The ID card, as it was originally proposed, if it had been made compulsory from the word go, as I wanted it to be, would have been one of the answers to that and would have saved the private sector very considerable sums of money in the long run.

My Lords, I fully understand the sentiment behind this, but I am not sure this is the best way to go. I do not think it is really the Home Office’s forte to produce such a report. I entirely agree with the noble Baroness, Lady Hamwee; there are a lot of lessons to be learnt and a lot of people studying this sort of thing. As for the figures used by the noble Lord, Lord Rosser—and taking the point just made about the banks—that is the whole point. People confuse theft of credit card details with identity theft. Identity theft is when someone’s identity is taken over and used to do many other things, such as entering into contracts, travelling across borders and perpetrating crimes. Nicking a credit card and its details is something completely different. Those provide the huge figures, and the people who can stop that are the banks and the credit card companies by increasing their security. They are always looking at this, and they are trading off between the losses they make on transactions where cards are not present, and the cost of additional security. We are seeing new security measures coming through, but it is not a government job. There is no point at which you would take a national identity card that is not designed for online transactions, and a credit card that at the moment is not designed for them, and hope that one is going to help with the other. Actually, the entire problem about security for the credit card is contained there, and the people know what to do about it. They are getting on with it rather slowly to my mind, but when the fraud figures get big enough they will do something about it. I agree there are lessons to be learnt, but I do not think it is an identity card lesson. There are some other lessons to be learnt, but I think that there are other bodies better qualified to do the job than the Home Office writing expensive reports.

My Lords, the amendment in the name of the noble Lord, Lord Rosser, raises two issues. He spoke to the first issue as regards combating identity fraud and the effect of the repeal. He did not really mention the second, which would require us to write reports on the operation of the identity card scheme. I will deal with both those matters because, if the amendment were accepted, they would be obligations on the Government.

I very much support the notion that what we do in government should be evidence-based, but I do not think that trying to draw lessons from a scheme of such narrow scope and numbers, as well as short duration, will help us a great deal in what are, without doubt, serious issues. One can draw a number of lessons about the operation of the scheme itself, but I do not know that they would cast much light of a general kind on how to operate identity schemes in the future. Frankly, the Government’s view is that this is not a worthwhile thing for us to try to do.

We entirely agree that combating fraud is a major issue. There is no argument between us on that. That is precisely why the Home Office is taking it very seriously in conjunction with other departments. The National Fraud Authority and the National Fraud Intelligence Bureau have, as I mentioned in Committee, produced a strategic threat assessment of the harm and the impact of identity fraud. I entirely agree with the noble Earl, Lord Erroll, that identity is an issue and we certainly will have to do work on identity authentication. That would have been the case even with the NIR.

These assessments are now being taken as the base for an action plan, which I also mentioned in Committee. I hope that the House will accept that it would not be sensible for us to publish the details of the action plan, which is designed to try to get at the root of those who are engaged in criminal and fraudulent activity. But I can assure the House that we are taking this issue seriously.

I have listened carefully to what the noble Baroness has said. It worries me that the Home Office seems to be considering another form of identity card. I sincerely hope that we will not have another proposal for a national identity card and register by the back door.

I am not quite sure how the noble Lord gained that impression. All I said, I think, was that identity authentication, which is not anything like the identity card, is an issue. If you have a transaction with the bank, it does not know who you are, and you want to know who they are.

Does the noble Baroness not agree, however, that an identity card would be the easiest way of authenticating identity?

I think that this is a debate perhaps of a more expert kind, but I do not agree that that is the case. I should like to make one other point on combating fraud. We also said in Committee that we would review whether there was overlap or duplication of the offences which are being re-enacted as a result of this Bill with those in the existing Fraud Act 2006. We are looking also at the Forgery and Counterfeiting Act 1981 in an exercise to make sure that the legislation is tidy and, if we can, to simplify it. Both on the legislative front and on the question of actual action in government to combat fraud, vigorous action is being taken. I therefore ask the noble Lord to withdraw his amendment.

Obviously, the reason for bringing forward this amendment relates to the evidence given in Committee in the other place. One of the organisations that had had most involvement with the identity cards scheme—the pilot carried out with the Manchester Airports Group—clearly referred to the benefits of the scheme with regard to identity. Quite relevantly, it said it thought that, even if identity cards were no longer there, perhaps the benefits that it had seen arising from the scheme could be achieved through other means. In the light of that kind of evidence, I should have thought that the Government would have been interested in the impact of the repeal of the Identity Cards Act 2006 and of trying to ensure that the benefits that at least some of those involved in the pilot exercise saw coming from it could be retained through other means. I am a little disappointed that the Minister has not indicated that the Government intend to carry out any sort of investigation or review of the benefits that were achieved from it and of any benefits relating to the issue of identity fraud to see whether they could be maintained through other channels.

The part of the amendment about a report being required within one year is less important than actually looking at what happened with the identity card scheme and trying to ensure that any benefits that arose from it could be retained in other ways. I am very grateful for the interventions and contributions that have been made by noble Lords in this debate in which reference has been made to the problems of identity fraud. I think I am right in saying that there is a rollout of a new generation of identity documentation in Germany which will include a radio-frequency identity chip to help to facilitate, or so it is claimed, secure online transactions. I hope that as part of the action plan to which the Minister has referred that has been set up and is being developed that some regard will be paid to what is happening in Germany and whether that has a contribution to make in this field.

I am a little disappointed that the Minister, irrespective of the issue of the report, was not prepared to say that the Government would seek to take advantage, through an examination of what happened during the identity card scheme, of any contribution that could be made towards the fight against identity fraud and ensure that any benefits that the scheme had achieved were retained through other means. I am sorry that she has not been able to say that the Government will do that. Nevertheless, I beg leave to withdraw my amendment.

Amendment 5 withdrawn.

Amendment 6

Moved by

6: After Clause 10, insert the following new Clause—

“Independent review

(1) The Secretary of State must, within 3 months of the coming into force of this Act, appoint an independent person to keep under review the arrangements for the time being maintained by the Secretary of State (and any person or authority to whom or to which he delegates any related function) for the purpose of his functions under this Act or any subordinate legislation made under it.

(2) The person so appointed shall report annually the findings of his review to the Secretary of State, with such report being made contemporaneously available to Parliament.”

My Lords, this amendment was moved in Committee. I bring it back and I hope that what my noble friend may have to say in response to my moving it will assuage the concerns that exist in this House about the dismantling of this complex scheme. Let us make no bones about it, the national identity register and all that is therewith and the dismantling of the whole apparatus is no simple matter, hence a 12-page Bill. The object of the exercise is to ensure that there should be an independent review to satisfy this place and the other place that all has been done properly and well, particularly of some of the subcontractors in relation to the national identity register and the deletion in a safe way of the mass of information that they already hold.

Clause 51 of the Data Protection Act 1998 imposes a general duty on the Information Commissioner to promote the eight data protection principles. They are all very sensible principles and the network of those eight principles provides reassurance that use of data is not improper. However, that is a general duty. There is no specific obligation that one can point to arising from those eight principles in terms of the national information register that we are dealing with here.

Those who have added their names to the amendment and, at an earlier stage, Earl Erroll—

My noble friend referred to Earl Erroll. Actually, he should have said the noble Earl, Lord Erroll, but if he was going to say Earl Erroll, he ought to have said the Earl of Erroll.

I am thoroughly schooled, my Lords, and deeply grateful to—I scarcely dare address him now—the noble Earl Ferrers.

Oh my gosh. I shall go back to school.

This is a basic and simple matter. I shall be interested to hear what the Minister says in response to the amendment.

My Lords, the noble Lord who moved the amendment may be slightly surprised to know that I support it, but for reasons that are rather different from those that he put before the House. A friend of mine described the Bill as the King Canute Bill; in other words, it is doing away with something—identity cards—which, in a relatively short time, whatever Government are in power, will have to be reintroduced. That is almost inevitable. I would hope that an appointed independent person would give that recommendation to the Government of the day and say, “Sorry, we have got it wrong. It is time that we reintroduced ID cards”. I agree entirely with my friend’s view, except that poor old King Canute is the most maligned man in English history, because he never suggested that he could hold back the tide. What he said to his courtiers was, “I cannot hold back the tide”. I suppose that it is the first example of PR going badly wrong.

There will come a point where the need for smart card technology will become such that we will have to introduce an identity cards Bill. This amendment would at least allow an independent person to look at it and say, “Sorry, we’ve got it wrong. Let’s have another look. Let’s introduce ID cards”.

My Lords, if I had got my act together a bit more quickly, I would have added my name to the amendment, because it is very sensible. There are some residual powers in the Bill which we need to keep an eye on. Although an Information Commissioner exists, he does not have the power to march in and look at things unless there are complaints. He would also be overextended.

We need to look out for residual powers that could give rise to concern. They come in Clause 10. Subsections (8) and (9) sensibly state that certain information which is gathered to prove someone’s identity when a passport is being issued should be destroyed after 28 days. Given that the Government will destroy the information within 28 days, I am happy for them to consult other databases—I mentioned in Committee electricity bills, which is probably the quickest way of finding whether someone has changed address or where they really are. I have no problem with the Government doing that to verify a person’s identity for the purpose of producing a passport.

However, then we get to subsection (10), which is the good old catch-all. It says that the Government can retain the information beyond 28 days for the purpose of “preventing or detecting crime”—I remember this sort of wording in RIPA, which led to a lot of grief—and “apprehending and prosecuting offenders”. Well, that depends on how quickly they apprehend them again. We should have oversight by an outside commissioner who reports to Parliament and not by a Home Secretary, because this sort of thing can get out of hand and, later, suddenly rise up to bite a Government in the future. We have several commissioners doing this sort of job elsewhere in the security world. We either add it on to someone’s job or create another one, but it is sensible for protecting the public.

In Committee I raised the point on subsection (10) to which the noble Lord referred. Is it the noble Earl or the noble Lord?

My Lords, it is the noble Earl. It is very confusing. I am actually the Earl of Erroll, but we are in distinguished company as we have two Earls who have surnames as their titles—Earl Ferrers and Earl Attlee. However, I would still refer to them as the noble Earl, Lord Attlee, and the noble Earl, Lord Ferrers. Thank you very much for correcting the House on this.

In Committee I raised the issues on subsection (10) to which reference has just been made, and I did so for the same reasons—the concerns about, for instance, judicial oversight of a Secretary of State’s decision to retain information for these purposes. I was told then that subsection (10) reflects the provision in the Data Protection Act. I went away and looked at that, and I ought to say thank you. I was entirely happy that although the wording is a little different, it amounts to precisely the same thing. That is not to say that the issue is entirely satisfactorily dealt with. Perhaps it should be dealt with in a different way in this piece of legislation or, as I would like to see, more widely. However, I think that that is a different point.

It is the noble Earl, Lord Ferrers. For goodness’ sake, the noble Lord is still on the Front Bench. He really ought to get to know the rules and procedures of the House.

If noble Lords will indulge me for two seconds, the only person who is the exception here is the noble Duke, the Duke of Montrose. Otherwise, we are all Lords and Ladies. We are Peers, so socially we refer to each other as Lord and Lady. Even a Baroness is a Lady, and we put the true title in front.

The noble Lord, Lord Hunt, is a very bright noble Lord, and he normally picks up things straight away, but he has made the mistake twice. If he wishes to refer to me as he should, he ought, with respect, to say “the noble Earl, Lord Ferrers” and not to say “the noble Lord, Earl Ferrers”.

My Lords, while we are in a correcting mood, may I remind the House that we are actually on Report and not in Committee, as amusing as the exchanges have been heretofore?

My Lords, I think that the noble Lord, Lord Skelmersdale, was quite right to correct us on this matter. I would however say to the noble Earl, Lord Ferrers, that I have always referred to him in that manner. I will read Hansard with great interest, because I think that, when he rose, he actually said “the noble Lord, the Earl Ferrers”. Perhaps we could reconvene tomorrow to discuss that further when we have all studied Hansard with great care.

We find ourselves in interesting company in this debate because noble Lords who have spoken have, very clearly, different views about ID cards. My noble friend Lord Maxton and I are convinced that, before long, a proposal will come from a Government to reintroduce identity cards on the basis of convenience to the public.

I thank the noble Lord for giving way. Before we forget, we need to remember that the ID system that we are abolishing was not obnoxious for the mere card; it was obnoxious for the national identity register which carried a mass of personal information and which Microsoft reckoned would become the greatest honey pot in the world for crime.

I shall make two points about that. First, I fully understand the point that the noble Lord is raising. It is quite remarkable that we have reached a situation in which private sector companies such as Google are allowed to amass a massive amount of information and then use it for marketing purposes. Frankly, I have some concerns about that. I understand the noble Lord’s concerns.

The fact of the matter is, as the noble Lord must know, a lot of the material gathered by Google has been gathered illegally. I do not think that the point that he is making in quoting Google is a very good one.

I look forward to further debates on those matters. The noble Lord is quite right. I hope that your Lordships' House will have further opportunities to discuss the implications of that, because it is a matter of great concern. There are some international companies that seem to feel that they can do what they like, and there is a need for this to be looked at very carefully. I understand the concerns about Governments amassing data. Equally, I refer the noble Lord to Mr Hodder, who wrote to me before Grand Committee, as an example of a business person who has used his card 30 times in going to the European zone and found it very convenient. For that reason, I do not think that we have heard the last word about the use of such cards.

I hope that the Minister considers taking this matter away. Whatever view noble Lords take of what the last Government did and of the nature of the cards and the information, it is rightly important that the public have confidence that the process used is done properly and well, as the noble Lord, Lord Phillips, said. The BBC carried a very interesting story about some of the techniques that will be used to ensure that the information is appropriately destroyed. I welcome that, but it would be helpful—and it is an important matter of public confidence—to have a proper independent scrutiny of this matter, which is why I very much support the noble Lord in his amendment.

Two separate issues seem to have been debated under this amendment. The first was whether one needs the extraordinary amount of information that would have been contained on the national identity register as a means of establishing ID cards, and whether that is the kind of thing that we want to see reintroduced, which I certainly do not believe to be the case. The second issue, which is the proper intention of the amendment, is about ensuring that information retained by the Government is properly governed and accountable. On that second point, I share absolutely the preoccupations of those who have proposed the amendment, but I have reservations about the method that they have chosen to achieve the end. In effect, the amendment establishes a new individual—some sort of passport commissioner—who would have the job of overseeing how the data were used and retained by the IPS. That would also be the case in connection with information received by third parties for the validation of passport applications.

In our view, the Information Commissioner has significant powers, and we would regard them as sufficient to examine and consider or scrutinise any of the data processed within the IPS. I think that the noble Lord has had a conversation with the Information Commissioner to that effect. My impression of the Information Commissioner is that he takes a considerable interest in the operation of the Act and has powers to serve the IPS with a notice to allow him, or his staff, to find out whether the IPS is complying with the Data Protection Act, which is the governing Act here. He is able to oblige the IPS to allow him or his staff to enter any premises and to show any of the specified documents or to see any of the information of the specified descriptions that he wishes to inspect.

Those are very considerable powers. I share the preoccupation of the House in ensuring that Government retain information only for the purposes for which it is genuinely needed and they are governed in ways which ensure that that is the case—that it is not used for purposes for which it was not specified and for which the Government are not entitled to use it. It is important for us to ensure that this is the case, and to talk to the Information Commissioner to ensure that he is able and willing to exercise his powers in this way, which I believe to be the case. I ask the noble Lord if on that basis, and with an assurance from the Government that we will take the intent of this amendment seriously, he is willing to withdraw his amendment?

I am grateful for what my noble friend the Minister has said. I am happy to withdraw the amendment, but would she keep us informed about the conversations she intends to have with the Information Commissioner? Could she assure us of that?

Amendment 6 withdrawn.

Immigration and Nationality (Fees) (No. 2) Regulations 2010

Motion to Approve

Moved By

That the draft regulations laid before the House on 11 October be approved.

Relevant document: 3rd Report from the Joint Committee on Statutory Instruments.

My Lords, the UK Border Agency currently spends over £2 billion to manage its borders and control migration. Over a third of its total running costs is recovered through fees on visas, nationality and immigration applications. The remaining costs are met by the UK taxpayer. Clearly there is a balance between these two things to which I shall return.

Earlier this year the Chancellor set out in his emergency Budget the position of the nation’s finances, which revealed the very difficult choices that had to be made by government departments. Of course the decision to increase the fees is relevant to the background and the economic situation which we were left by our predecessors. The decision has been taken to take the UK Border Agency into the new spending review period in a position where more is done to balance the costs of supporting the immigration system between those who use and benefit directly from it and the UK taxpayer, who is otherwise obliged to subsidise it.

The Home Office is making savings of £367 million this year. The proposals we are debating today form the other part of the equation—that is to say, seeking to increase fees paid by migrants and sponsors.

The regulations are made under Section 51 of the Immigration, Asylum and Nationality Act 2006 and are in accordance with the powers granted in Section 42 of the Asylum and Immigration (Treatment of Claimants, etc.) Act 2004, as amended by Section 20 of the UK Borders Act 2007. Under Section 42, the Secretary of State can set a fee for an application at a level that exceeds the administrative cost of determining the application. The way in which the legal powers are defined means that the Government must also specify fees for applications, processes and services that are provided at or below the administrative cost of determining the application, in separate regulations under the powers in Section 51 of the Immigration, Asylum and Nationality Act 2006. These regulations were laid before Parliament on 9 September 2010, are subject to the negative process and are not being debated. I recognise that having fees in two sets of regulations makes things a little complicated and I am happy to take the points that may be raised today on any of the fees proposals.

For these mid-year increases, the UK Border Agency has undertaken very careful consideration of the issues. These increases are made in line with the principle that the overall contribution of fee increases should be spread across all routes and be in line with our broader policy to align better our fees structure overseas with the one operating in the United Kingdom. Where there are greater increases to the fees on some routes than others, we have done so on the basis of the benefit to the migrant of a successful application. Examples of benefit vary from route to route but may include, for instance, access to the UK labour market, the right to stay here permanently or the right to vote.

These increases mean that the Government can hold other fees at existing levels, or increase them only by a comparatively small amount to help maintain our international competitiveness and in recognition of the importance of these routes to the UK economy. For example, the Government recognise the importance of keeping direct costs to sponsors under the points-based system as low as possible, particularly in the current economic climate. The fees for acting as a sponsor and the certificate of sponsorship fee have been held at the same level as previously, while maintaining existing concessions for small businesses, charities, education providers and the arts and entertainment sectors.

In the same spirit, we have managed to limit the tier 4 visa increase to just £21, which is for a visa being offered below cost. It is a very small proportion of the overall costs incurred by a tier 4 student coming to the UK to study, who will pay an average tuition fee of close to £10,000 a year in higher education. The visitor visa has been increased by only £2. Tourism is obviously important to the UK economy, but it is right that the migrants contribute towards the costs of the services they use and benefit from. However, we have still kept it down and the fee recovers only about half of the total administrative cost of the visa.

The House will, I hope, be pleased to hear that these proposals also introduce a fee exemption where a person makes an application for a nationality registration relying on Section 4C of the British Nationality Act 1981. This will align better the position of those applicants born to British mothers with that of applicants born to British fathers. This is a long-standing grievance, which I have shared, and was a matter of great interest to this House. I hope that fulfilment of that commitment made by the previous Government gives satisfaction today.

This Government are committed to sending a message overseas that we welcome legal migrants and that the UK is open for business. I believe, as the Government believe, that migration brings great benefits to the UK. However, I also believe that UK citizens and newcomers to this country wish to see an immigration system in place that is sustainable and stronger in the future, and is less subsidised by the average taxpayer. The immigration system costs money and, through these proposals, the Government are seeking today a greater contribution, as I say, from those who benefit most—a little more in line with the benefits on offer—so that the traveller and migrant meet a greater proportion of the costs of the system. As your Lordships can see, we have tried to keep down the cost for those who receive comparatively little—the tourist and, indeed, the student—and put the increases primarily in those areas where there is long-term benefit for individuals who come to work or to settle here. I beg to move.

My Lords, I rise to speak on the Motion as the regulations have a direct impact on a tiny company—on whose advisory board I sit—called Pingar UK, which is developing contextual search engine technology for a number of years. We are a subsidiary or offshoot of a New Zealand company that is funding the research and wanted to have a research establishment over here. This information is highly relevant as it will explain why this government policy is a disaster that will drive small companies such as Pingar offshore.

Tomorrow night, I will take part in a conference call with the New Zealand company in which we will almost certainly decide to move out of this country because of the immigration policy and the visa policy. A company employee took a degree at a Welsh university. He is a Hong Kong citizen. He obtained an 18-month postgraduate visa to do further development work, but that has expired. In the summer, we applied to get the visa extended, but we got caught up in the mish-mash of everything when the new immigration cap of 24,100 visas was suddenly introduced. We needed a certificate of sponsorship.

We got the certificate of sponsorship just in time, which was amazing since we employ hardly anyone over here and the chap in question will really be the first serious employee. That was the right thing to do. However, we were given a zero visa allocation. All the time that we put into the matter was completely wasted because we cannot sponsor him. We have now been told that, for £1,000, we might get a visa after all. The decision has been taken that, as a small business, we cannot afford to pay out £1,000 on a gamble. As another director of the company said, “It is a lottery”, so there is absolutely no point in doing it.

I am intrigued that the Explanatory Memorandum’s paragraph 11, “Regulating small business”, states:

“The legislation does not apply to small business”.

The very reason that we will have to relocate offshore is because, indirectly, the legislation does apply to small business. We will probably try to relocate the research arm in either Singapore or Hong Kong. Pingar is not the only company that I know of in this situation. Many people are considering relocation. I am afraid that the Government’s immigration policy is about the most stupid thing that they could have done for small business.

I have heard, and read in the papers, about the new entrepreneurship visas that are about to be issued. I would love to know how to get one for the chap, if we can. We do not have long to make up our mind. He is currently abroad as, under the law, he is required to be. In the next week or two, we have to decide where he should move to. I should be delighted to hear from the Minister how these new entrepreneurship visas will work. Why should we pay £1,000 to enter a lottery to see whether we can exist in this country?

I thank the noble Baroness for her careful explanation of the regulations. The noble Earl, Lord Erroll, has taken us into a rather wider debate. His comments were very interesting and I hope that we will be able to hear more about that issue. There is great concern that the way in which the current cap is operating is doing real damage not just to British business and industry but to the arts and academia, as we have discussed in the House on several occasions in the past few weeks. I hope that we will receive an early announcement from the Government that they will look at the policy again and make it more flexible.

Having said that, we support the general principles that the noble Baroness has outlined. We recognise the challenge of balancing the burden of the administration of the system between the migrant and the taxpayer. My reading is that the burden on the migrant is increasing slightly, although not significantly. Perhaps the noble Baroness can confirm that. I should also be grateful if she could say what impact the fees increase is likely to have on the number of applications. Has an analysis been carried out of the possible impact on at least the main categories of application and whether there will be any unwelcome impact on regular migration when fees are increased? The Minister rightly mentioned some of the benefits of migration, which I must say was welcome.

Has an analysis been carried out of where there is clear benefit to our country from the skills that have been brought in and of our costs and prices as compared with those of other countries, such as Australia, European Union countries and the US? To extend the theme that was mentioned by the noble Earl, we need to be mindful that this country is a great global trading nation. We must be wary of any action that we take that would undermine the ability of UK companies to attract the best people. That has been one of our great strengths over the past 30 years, which it is important that the policy on immigration should not undermine. It is worrying to hear of small companies looking to, say, New Zealand for R&D purposes because of the constraints of the current system.

I would also be grateful if the Minister could confirm whether the increase in the cost of visas, particularly settlement visas, is part of a more general policy to bear down on numbers. Is the price increase part of a general policy of reducing net immigration? Perhaps the Minister would also refer to the matter of the migration impact fund, which was raised by my right honourable friend when the regulations were debated in a committee of the other place. I understand that the visa fee increases of the previous year took into account a £50 million contribution from migrants to that fund, which was intended to pay for projects in constituencies with a sudden increase in the number of immigrants. The Government have decided to abolish the fund, but the amount to cover the fund is staying within the visa fee. If the Minister could give us an explanation of that, it would be extremely welcome.

Will the Minister also provide a little more explanation of the alignment between fees in country and fees out of country, which she referred to in her introduction? Is the goal to have equalisation? Given the policy of looking at the proportion or cost of the administration of the fee, what measures will be put in place in that regard?

I note the significant increase in the fee for dependants. We do not oppose that, as there is a huge benefit to the dependant, but is that increase part of a deliberate policy to deter immigrants from bringing in dependants? Is it in line with the reductions of the rights of dependants, such as work rights, as part of the scheme, or is it just a method of raising extra resources when there is pressure on budgets?

Will the Minister also reassure me that no fees or charges will be imposed on Members of Parliament or Members of your Lordships' House who make inquiries about the progress of an immigration application, on behalf of a constituent, in the case of an MP, or of someone who has approached a Member of your Lordships' House, as happens from time to time?

I have no doubt that the noble Baroness will be able to respond to these questions, orally or in writing. She may take it that we support the general principles, although I share the noble Earl's concern about the wider aspects of the cap, which are doing great damage to British business at the moment.

My Lords, I followed the speech of the noble Lord, Lord Hunt, very closely and will try not to repeat what he said, but I, too, have a number of questions.

The noble Lord, Lord Hunt, asked how our fees compared with those of a number of other countries. I would be particularly interested in those of EU countries, because that is the context in which we should look at ourselves.

Wider policy objectives are referred to in the Explanatory Memorandum. Paragraph 8.2 gives the example of attracting specific groups of migrants who are beneficial to the UK. Like both the previous noble Lords, I find it difficult to separate that from the wider issues of immigration policy. Perhaps the Minister could amplify on that, without taking us into a bigger debate, which we will no doubt have very soon.

Can the Minister tell the House how the monitoring of the impact of the fees, which the Explanatory Memorandum promises will be monitored closely, will be done? Will it be a matter of looking at trends? Important as the examples that we have heard are, those examples would probably not feature very much, if at all, in the statistics. However, sometimes anecdotes are useful.

Like the noble Lord, I am happy to support the approach that has been taken in the regulations.

My Lords, a number of points have been raised in the debate, which I will try to answer.

One of the first points was on the question of a sensitivity analysis of the elasticity of demand for visas and whether price affects take-up. Partly because the impact of the fee in relation to the benefits gained is relatively marginal, there is little or no convincing evidence that the increase will have such an effect. Indeed, we have had cases—this may be regarded as perverse—in which an increase in the fee actually led to an increase in demand. The reverse is also true, as a reduction in the fee has coincided with—I do not know whether it led to—a reduction in demand. We do not have convincing evidence of a direct elasticity relationship. However, it is clearly important that we monitor what goes on, and we intend to do that. It is fair to say that there is a continuous monitoring process. In the wake of price increases, it is right and sensible that we should be particularly careful about the monitoring of their effect, and we will certainly do that.

On the competitiveness of the UK visas system with other regimes, comparisons are fairly difficult because, as Members on the Benches opposite will know, no two national systems are exactly the same. However, I will try to give some comparisons. Two comparisons that are perhaps relevant include comparator countries in the European Union, which the noble Baroness will be interested in, and some of our Anglophone competitors. France and Germany operate simplified immigration systems. In Germany, applications include a Schengen visa—comparable to a UK short-term visa—for which the fee is €60, which this month is roughly £51. France offers a Schengen visa for the same fee or a long-term visa to remain for more than 90 days, for which the fee is €99 or roughly £85. The comparable figure in the UK is £70. Overall, therefore, we mostly reside in the middle range, although we are possibly nearer the upper end for the charges for some long-term visas. I am happy to give the noble Baroness more detail in a table if she would like. To give another example, Australia charges a total fee of £1,074 for a tier 2 visa, which is a longer term visa, whereas the equivalent figure for the UK is £1,750. Ireland is much more expensive. From looking at these figures, you would not immediately say, even with the increases, that the UK is out of line with comparator migrant countries.

On the question of fees inside and outside the country, this is where one enters the Hampton Court maze of the fees structure, as the permissions for raising fees inside and outside the country are different. However, I can say to the noble Lord that equalisation is not the objective. We are raising the fees in those contexts in which we are allowed to do so and where we are able to do so without regard to whether we are going over the limits of the cost. We do not intend, or indeed have as an objective, that the fee increases or the fee structure should contribute to, or be part of, immigration policy. The issues are separate. Therefore, if noble Lords have any thought that the fee increases might somehow be a covert immigration control, I can assure them that that is not the case.

I am quite certain that we will not be charging MPs or Members of your Lordships’ House for inquiries.

Finally, on the question of the migrant impacts fund, it is indeed the case that a contribution from the visa fee previously went to feed that fund, which has now been abolished. The money will now contribute to the cost of the visa and will mitigate increases that we would otherwise have had to make.

I am grateful to noble Lords for their support for—if I understand the mood of the House correctly—the price structure that is being put in place.

Motion agreed.

Justification Decision (Generation of Electricity by the EPR Nuclear Reactor) Regulations 2010

Motion to Approve

Moved By

That the draft regulations laid before the House on 18 October be approved.

Relevant documents: 4th Report from the Joint Committee on Statutory Instruments, 10th Report from the Merits Committee.

My Lords, in moving the draft Justification Decision (Generation of Electricity by the EPR Nuclear Reactor) Regulations 2010, I shall speak also to the draft Justification Decision (Generation of Electricity by the AP1000 Nuclear Reactor) Regulations 2010, and the draft Nuclear Decommissioning and Waste Handling (Designated Technical Matters) Order 2010.

The House should consider these three instruments, which I laid before it on 18 October, together. Two of them contain the decision of my right honourable friend the Secretary of State for Energy and Climate Change, as justifying authority under the Justification of Practices Involving Ionising Radiation Regulations 2004, that the generation of electricity from two nuclear reactor designs—Westinghouse’s AP1000 and Areva’s EPR—is justified. The third, the draft Nuclear Decommissioning and Waste Handling (Designated Technical Matters) Order, specifies which technical matters, in addition to those already in the Energy Act 2008, are to be “designated technical matters”.

First, I will consider the two regulatory justification decisions. Regulatory justification is derived from the recommendations of the International Commission on Radiological Protection, the ICRP, which are used around the world as the basis for radiological protection. The ICRP’s recommendations form the basis of the European basic safety standards directive and, in the UK, of the Justification of Practices Involving Ionising Radiation Regulations 2004.

The regulations provide that the Secretary of State, as justifying authority, must decide whether a new class or type of practice resulting in exposure to ionising radiation is justified, in advance of it being first adopted or approved, by its economic, social or other benefits in relation to the health detriment that it may cause.

Regulatory justification is an initial, high-level process. It is the first step in the radiological protection regime and is made on a generic, not a site-specific, basis. Following a regulatory justification decision, there are further processes involving more detailed examinations by regulators of reactor designs and of the impact on specific sites of proposals to build nuclear power stations separately and after the regulatory justification process.

A justification decision does not mean that the reactor design and the nuclear power station will pass through these further processes successfully. These further processes are based on the principle of optimisation, a requirement to keep all exposures as low as reasonably achievable, and dose limitation, the principle that the total dose to any individual from regulated sources in planned exposure situations—other than medical exposure of patients—should not exceed the appropriate recommended limits.

Regulatory justification decisions are made in advance of full information on the benefits and detriments of the practice which might emerge from operational experience. They therefore seek to identify the potential detriment from the reactor designs by making assumptions based on the best information currently available, including information arising from the operational experience of similar classes or types of practice and the expert opinion of regulators and others. If new and important evidence about the efficacy or consequences of the class or type of practice comes to light, the 2004 justification regulations allow the Secretary of State to reassess any regulatory justification decisions.

Last year, my department published a consultation on proposed decisions that two reactor designs should be justified—Westinghouse’s AP1000 and Areva’s EPR. After considering responses to that consultation, on 18 October my right honourable friend the Secretary of State for Energy and Climate Change announced his decision that the two designs are justified. I will outline our reasons for making those decisions.

We see a clear need for the generation of electricity by the AP1000 and EPR through the contribution they can make to securing the UK’s energy supplies, helping the UK decarbonise and meet legal low-carbon obligations and benefiting the economy more widely. Against this, the radiological detriment to health from these nuclear reactor designs and their associated waste facilities will be low compared to naturally occurring levels of radiation and effectively controlled by the regulatory regime. The AP1000 and EPR will be able to produce large quantities of electricity over an extended period, making a significant contribution to the electricity supply. Nuclear power has long been our most significant source of low-carbon energy and can continue to contribute to our energy mix.

It will be for companies to fund and build any new nuclear power stations and to determine whether they provide sufficiently attractive returns. Nuclear power is economically competitive with other forms of generating technology, and developments in the UK market have made clear that energy companies are investing significantly in the prospect of new nuclear power stations.

We are confident that there will be economic benefits for the UK from new nuclear power stations. Beyond direct investment and employment, we can benefit through the development of a globally competitive nuclear supply chain and improvement in the quality of a skilled UK workforce. Further, we believe that, if nuclear power stations are not part of the UK’s future energy mix, the UK would face significantly higher costs in meeting the transition to a low-carbon economy.

Against these benefits, there is the potential for detriment. However, the safety features of the designs and the regulatory regime, which sets limits to the release of radiation and monitors compliance, will ensure that emissions will be minimised. The radiation to which members of the public would be exposed, as a proportion of the overall radiation to which they are exposed from all sources—including medical procedures and background radiation—would therefore be very small and the risk of health detriment very low.

The decisions apply to the operation and decommissioning of new nuclear power stations and also the management and disposal of the radioactive waste they will produce. In making the decision, we are therefore satisfied that the regulatory regime will limit health detriment from waste management and disposal, that the interim storage of waste can be carried out in a way that causes a very low level of health detriment and that a robust process is in place to identify a site for, and build, a geological disposal facility.

We also concluded that the potential environmental detriments arising from new nuclear power stations are likely to be avoided or adequately mitigated by the licensing and planning regime. We considered the risk of detriments from an accident or terrorist incident. This potential detriment already exists and the risk of such incidents would be seen in the context of the regulatory regime, which is intended to prevent accidents and protect against terrorist attack. We are confident in the regulatory regimes for safety and security of civil nuclear installations and materials in the UK and consider that the likelihood of an accident or other incident giving rise to a release of radioactive material is small. My right honourable friend the Secretary of State for Energy and Climate Change therefore concluded that these significant potential benefits outweigh the potential detriments, and that the generation of electricity by the AP1000 and EPR should be justified.

I now consider the draft Nuclear Decommissioning and Waste Handling (Designated Technical Matters) Order. The purpose of the draft order is to support the requirement under the Energy Act 2008 for nuclear operators to make financial provision in their funded decommissioning programmes for those designated technical matters. The Energy Act 2008 contains only one category of designated technical matters—decommissioning a nuclear power station and cleaning up the site. The Energy Act provides that the Secretary of State specifies by order the other matters which are to be designated technical matters. The order is, therefore, necessary to give operators clarity over what are the designated technical matters that they must provide for.

The order specifies that the construction and maintenance of an interim fuel store used for storage, any activity preparatory to the decommissioning of a relevant nuclear installation, and the cleaning up of the site are designated technical matters. This means that these costs also have to be funded through funds set aside as part of the funded decommissioning programme. It might be claimed that the operator could pay for these costs out of operational expenditure and that designation is unnecessary. However, this may put the costs in competition with other demands on revenue and if the operator was unable to meet these costs when they fell due, there would be a risk that they could fall to the taxpayer. It is therefore appropriate to designate these costs to limit the risk to the taxpayer by ensuring that funds are set aside to carry out the relevant work. The order will be complemented by the Nuclear Decommissioning and Waste Handling (Finance and Fees) Regulations, which will be laid before Parliament once this order completes its passage.

Following a consultation on the provision of the draft order earlier this year and responses received, the Government do not propose to extend the definition of “designated technical matters” beyond interim stores and activities preparatory to decommissioning and cleaning up the site. I believe that the order will benefit both industry and the public. It clarifies the obligations of the nuclear industry and therefore reduces uncertainty and helps investment. The order, together with the Act, ensures that the costs of waste management, disposal and decommissioning do not fall on to the taxpayer.

I commend these regulations and the two other instruments to the House.

I start by declaring an interest as chairman of the Nuclear Industry Association. I do so for a number of reasons, not least because the NIA undertook the drafting of the justification report on which these statutory instruments are based. It was a lengthy process. Indeed, some of us thought that we would never see the end of it—first, in getting the reports right and, secondly, in terms of ministerial overview and the preparation of the SIs which we are debating today. It is fair to say that this is of critical importance to the realisation of the new nuclear build programme.

There are various elements. One could say that the building blocks, or the foundations, involve more than just the justification process in respect of the Areva and Westinghouse reactors. These reactors will also be subject to the rigorous generic design assessment programme being undertaken by the health and safety regulator and the Environment Agency. But these are of a different order, being almost exclusively technical in character and they do not concern us today. We have to satisfy ourselves and the country that the kit we are going to use is of a quality that can allay the fears of people in the UK. We have to recognise that there is not unanimity on the issue of nuclear power. There is certainly now, I think, what could be called a working majority and the consensus is probably a wee bit more robust than some of the elements within the coalition, but in order to reinforce and develop this consensus, we have to deal with the broad issue of the environmental concerns of the EU.

We have ceded to Brussels—probably correctly—a number of responsibilities in relation to environmental matters. I may be wrong, but I think that, apart from the reactor at one of London’s universities, the nearest one to London is in France, so it is only appropriate that we are subject to rather broad environmental legislation which covers the continent and not just this island.

In considering the process of preparing the report it would be wrong of me not to pay tribute to the work of Peter Haslam on behalf of the Nuclear Industry Association and its members. He had the responsibility of herding the cats into the bag and it was not always easy getting the various players around the table, but consensus was established, agreement was reached, the document was prepared and it is in no small way due to the efforts of Peter Haslam.

We have to be careful, not only about the issue of building a consensus of tolerance of and support for nuclear power, but about taking account of the fact that there are those who are quite happy—with other people’s money, usually—to seek access to the courts to have judicial review and things like that. It may well be that this will be the subject of a judicial review. I hope not and, indeed, I think that one way to ensure public confidence is that when those who are against nuclear power—they are perfectly entitled to be so— take the advice of their learned friends, they get the message that this document stands up to close scrutiny. The Minister and many of us across the House feel that to have got to this stage and to have these statutory instruments being discussed is evidence of our confidence in the robustness of the documents and, as time will go on, of the robustness of the case for nuclear power.

It is fair to say that issues relating to waste and decommissioning are worries. There is sometimes a wilful ignorance of the fact that other countries have accommodated waste, are treating it and dealing with it in a way which has, by and large, allayed public anxieties within those countries. We can look to Finland and Sweden. In Sweden, there has always been an anxiety about nuclear power, but there has not been the concern about storage, because Sweden has got on with the job. The funding of decommissioning and the treatment of waste and its storage are paramount and people have to be reassured that that part of it that has been created by private industry will be paid for by private industry. I make that distinction at this point because a lot of the waste that we have was created by nationalised industries and therefore is the responsibility of government. That part of the deal is not a subsidy but is the public purse meeting its historical responsibilities.

My second point is that not all of the waste is civil in character. It is waste that has come about as a result of the various forms of nuclear deterrent we have had. That again is a responsibility of the state. That is not a subsidy. It may well be that in putting together the three elements—the privatised waste, if I can call it that, the nationalised waste and the military waste—we create economies of scale that make the job that bit easier because the volumes will be such that critical mass will be created and we will be able to do it more cheaply, but that is not to suggest that we are talking about subsidies of one against the other.

It is important that these statutory instruments are dealt with today and that they get the support of the House. The industry can stand up to the challenge, “Well, they would say that, wouldn’t they?”. It does not want to be an unsafe industry. That is one argument, but the other argument, which is far more compelling, is that if these private companies do not get it right, it will perhaps cost people their lives, but it will certainly cost their shareholders a hell of a lot of money. Therefore, we realise the significance of the investments, the dangers of the materials that are being used and the problems that could be created if the reactors are not satisfactory. All these issues are being considered. Once we have this element out of the way, get the generic design assessment process completed and eventually get the planning applications going to the IPC in whatever form it finally emerges, we will be in a position to start building the nuclear power stations.

At the end of the day, even if we build no more nuclear power stations in this country, we will still have to decommission the existing facilities and handle the waste, so the three statutory instruments are relevant this evening. It is important that they are given the best support that the House can give them. I do not anticipate there being a vote as that is not our custom.

I have a commitment this evening so I have to leave the House and will not be here for the wind-ups. No discourtesy is intended. I was going to send the Minister a letter, but I thought that since there are not many people here I could just say it entre nous, as it were. It is important for the industry that we get this cleared out of the way. It is one of the important building blocks. It has been not tiresome, but time-consuming, and it is a necessity that no one would shirk from recognising has been central to the development of the nuclear industry and its regeneration in this country.

My Lords, I add my voice in support of these regulations. The noble Lord, Lord O’Neill of Clackmannan, and I were fortunate to attend a briefing this morning by one of the potential investors that would be building these nuclear power stations. One word came out of that. The noble Lord used it; it is “confidence”. He was talking about the billions of pounds that will be invested in the next generation of nuclear power stations. The investors will have to have confidence at every stage that this is going to go ahead and be successful.

We are discussing these regulations and the order. The whole process of justification has been very elaborate. I have here the justification report on one of the two designs of reactor. This has been a formidable step. The fact that the Secretary of State has now accepted that the justification process has been properly completed and that we now have these statutory instruments is one further step in the confidence of the industry.

This is not the last word: the industries have to continue to get further consents, not least the licensing of the designs through the generic design assessment process. We heard high praise this morning of the work of the Nuclear Installations Inspectorate in getting to this stage. There seems to be confidence that this will happen by the due date of July next year. That has to happen, but I say nothing about planning—we are not talking about planning tonight, and that is another stage to be got through.

The industry has been looking for a number of steps to generate confidence. The Secretary of State’s statement last month was a major step along the way. There was no question about that: it made an extremely favourable impression on the industry and its potential investors and the supply chain as well.

Last week I asked a Question about the future of the Nuclear Installations Inspectorate and I raised with the Minister who was representing the Department for Work and Pensions—he is responsible for the Health and Safety Executive, and the NII comes under the HSE—that we are still waiting for the decision about the reorganisation and, I hope, the setting up, through a legislative reform order, of a new statutory corporation to take over the functions of the NII. I do not know whether my noble friend can say anything more about that. It is something to which great importance is being attached by the industry, particularly because of the need for the NII to be able to recruit the people with the very scarce experience and skills against a background of a global nuclear renaissance. These people are much in demand and this process, which has been under discussion for some time, is seen by the industry as another important step which, if and when it is achieved, will continue to generate confidence. I hope my noble friend will be able to say something about that, although the actual process—I entirely accept this—is not for his department but for the Department for Work and Pensions. If he can say something that would help this process of confidence, to which I have referred, I would be extremely grateful.

Like the noble Lord, Lord O’Neill, I too have an engagement. I hope I can stay until the end, but I offer my apologies to the House if I cannot.

My Lords, I have never felt such pressure to make a short speech, so I will see if I can do it. I thank my noble friend for his usual panache in introducing the subject. One of the things that strikes me while reading through these statutory instruments is that we have, once again, a problem of opaqueness with respect to this industry and sector. They are among the few SIs I have read in which, even after reading the Explanatory Memorandums, it is quite difficult to really get to the depths of what they are trying to say. No doubt we can blame that on EURATOM regulations or whatever. In terms of designated technical matters, this sounds innocuous but is obviously crucial to these documents and the meaning of “justification” is rather different from what I have known before. In particular, we talk about approval, but neither of these reactors is approved at all. This is just the start of the process and there is much more to go on further. I was particularly interested that in the justification SIs we have two useful definitions—on intermediate-level waste and on spent fuel—but they are never referred to in the documents. That is slightly strange.

Unlike my noble friend Lord Jenkin, I did not manage to get through the large documents on the assessments, which I look forward to doing. Mainly health considerations are mentioned, but the documents refer to “environmental protection”. I would be interested to understand whether environmental issues were taken into consideration in terms of the effective cost-benefit analysis that is taking place.

When you get to the bottom of this, the regulations are not approval of either of these designs. I would be interested to obtain clarity from the Minister on when that approval process might take place. I also note that these regulations deal with only two of four reactor classes that the Secretary of State has deemed necessary to go through those processes. Where are the other two? Will they come through your Lordships’ House as well? Given that this is a requirement under the EURATOM legislation, I would be particularly interested to understand what has happened in terms of these two designs in other member states. Have they gone through the same procedure yet? Have any member states rejected them or hesitated in terms of justification? That would be useful and important to understand.

I see from some of the Explanatory Notes that “justification” includes a much broader process than just the nuclear reactions that take place and nuclear generation. It can include the whole supply chain. Therefore, is the justification seen by the Government to include waste disposal? I suppose I ask from this half of the coalition whether you can really justify such reactors when we have not sorted out waste disposal in the longer term. I treat that more as a philosophical question. Certainly, as the noble Lord, Lord O’Neill, has said, I have no intention of bringing the matter to a vote this evening.

On decommissioning, I welcome very much the Government’s repetition that there will be no public subsidy for nuclear power. I know that some of the papers answer why interim storage is included in decommissioning. It seems to me that it was already included effectively in the decommissioning of interim waste disposal sites. Obviously, interim waste facilities will have to be built anyway as these nuclear power stations are developed. What happens to the cost of building them to enable them to operate? Is that included in this scheme?

Although these instruments cover funding, and I know that we have further instruments to approve, I ask the Minister now when we are likely to have the detailed funding mechanisms. This caused considerable debate earlier in the year when the previous Government started to present this under one of the energy Acts. This is of the greatest importance. The Minister may not be able to answer these questions now, but certainly I would like him to in the future. How do we make sure that these funds, which will be very large amounts of money, are not affected by such issues as bankruptcy of the companies involved; are not sold on in the money markets to other owners; or, perhaps the biggest risk, are not consumed by the Treasury long before they ever reach decommissioning of the power plants? Given the fact that it is accepted that the nuclear industry will go ahead to meet our energy needs for the future, I welcome these regulations and hope that we will move forward in a well managed and effective way to achieve that.

My Lords, this has been a short but perfectly formed debate and I welcome the contributions from noble Lords. I note that the noble Lords, Lord O’Neill of Clackmannan and Lord Jenkin of Roding, may not be able to stay until the end, but I have probably benefited more from hearing them than they would from hearing me. I note also the comments of the noble Lord, Lord Teverson, on the technicality of the statutory instruments. In looking at the SIs today, I have been through more assessments, consultation documents and justification orders than I have for any other SI I ever spoke on in the other place. I am grateful to the Minister for the time he took in taking us through the process and the issues.

The three instruments before us today are linked. We have two justification decisions on nuclear reactors and a further instrument on nuclear decommissioning and the handling of waste. In all cases the Merits Committee drew special attention to these SIs because of their importance and because nuclear energy is a high-profile and sensitive issue, as was acknowledged by all noble Lords who have spoken. I am grateful to the Merits Committee for its work and I am sure that when he comes to reply the Minister will want to address the issues that it has raised.

The justification decisions are taken by the Secretary of State as the justifying authority; that is that the generation of electricity from the nuclear reactor designs, the AP1000 and the EPR involving ionising radiation, can be justified as the social, economic and other benefits outweigh the health detriments. The third statutory instrument relates to the costs of the decommissioning of waste and the funded decommissioning programme, which must be approved by the Secretary of State, setting out the likely costs of decommissioning and cleaning up the site and how those costs will be met. These three instruments strike at the heart of the issue, addressing, first, the need for new energy capacity and the ability of nuclear to provide low-carbon energy while assessing the level of risk, and secondly, the need to have a strategy and a policy for funding to deal with the waste that is created.

I want to flag up to the Minister, as did the noble Lord, Lord Jenkin, the need to move quickly on the new arrangements for the regulatory regime. I appreciate that this is not his responsibility—although he will have heard the Questions in the House on this last week—but rightly the remit of another government department. However, if there is to be public confidence in the system, the new arrangements have to be in place as the Government move forward with decisions such us those before us today. The Minister will know that the regulatory arrangements and expertise in this country are recognised and admired around the world, and we all want that to continue. Will he assure the House that his department has raised and will continue to raise this with the relevant Ministers in other departments?

We currently have 10 nuclear power stations in England, Scotland and Wales which provide 13 per cent of the total electricity used in the UK. All but one of these will be shut by 2025. If we are to maintain an energy mix using nuclear, then new stations will have to be built, as Secretary of State Chris Huhne announced on 18 October 2010 when he laid the instruments before us today. In his Statement he summed up the basis of his justification as,

“a clear need for the generation of electricity by these nuclear reactor designs ... because of the contribution they can make to increased security of energy supplies and reduced carbon emissions”.

He added:

“Against this the radiological detriment to health from these nuclear reactor designs and their associated waste facilities will be low compared to overall levels of radiation, and effectively controlled by the UK’s robust and effective regulators”.—[Official Report, Commons, 18/10/10; col. 44WS.]

Both the justification decisions were subjected to considerable consultation and no changes were made as a result of the consultation that took place. There has been some concern that there was no inquiry or hearing relating to the justification process. Does the Minister consider that the process is in any way weakened by not having any hearings?

These justification decisions are time-critical, given that the Government are committed to nuclear new build by 2017. The delays are regrettable. It would have been helpful if we had been able to get to this stage before the general election, and we have had nearly six months since then. I raise this not to apportion blame in any way but to seek the Minister’s views as to whether he considers that the Government are still on schedule for the new nuclear power stations to come into operation by 2017.

A further issue that may cause delay is the HSE licensing programme, which we have heard about already this evening. In July 2009, it was reported that the Nuclear Installations Inspectorate had written to two French companies that want to build reactors in the UK to express its concerns about the control and instrumentation—the C and I—of the European pressurised reactor, the EPR, which is one of the reactors that we are discussing today. I shall not pretend to have any great technical knowledge on these issues, but I know that C and I is also known as the cerebral cortex of a nuclear power station. It controls performance, including temperature, pressure and power outlet levels. The NII raised other related concerns; similar concerns have been raised by other regulators.

The HSE said that the EPR design in Britain could be rejected if its concerns could not be satisfactorily addressed. At the time, it was reported that, in addressing these issues, the design assessment stage could be delayed well past its expected completion date of 2011. As far as I am aware, none of the EPR reactors being built in other countries is yet in service, but the companies concerned engaged with the NII and were, and may still be, in discussion with it. The companies were confident that a solution could be reached. The NII rightly made it clear that it would not issue a licence unless it was satisfied that that design could be built and operated safely. Similar issues arise also with the AP1000.

The Health and Safety Executive has announced that it may have to delay a definite decision on whether to approve the designs of both the AP1000 and the EPR reactors. My understanding is that the HSE considers that all the technical issues can be resolved, but that there may be some delay. I was encouraged to hear the noble Lord, Lord Jenkin, say that at the EDF briefing this morning it was said that a slight delay is expected, but it would be helpful if the Minister could comment on that.

Have the Government given any consideration to possible legal challenges to, or judicial review of, these justification orders? The noble Lord, Lord Teverson, also raised this matter. If it were the case, does the Minister consider that it could significantly delay the process? Both these issues have the potential to impact on the 2017 time scales, so any reassurance from the Minister would be appreciated. Perhaps I may also raise something that is not in the justification orders: the use of mixed oxide fuel or reprocessed fuel, known as Mox. Are there plans to bring this forward at a later date? No justification order for Mox could potentially limit the scope of the reactors. It may just be that the work is ongoing, but it would be helpful to know.

I also invite the Minister to say something on any potential health risks and the level of any such risk. A number of respondents to the consultation raised concerns on this issue. It is difficult for any Government to balance risk to health and well-being against other factors. This justification order means that the Secretary of State, having examined the issue, considers that the social, economic and other benefits of proceeding with these two reactors outweigh the health detriments. The Secretary of State is charged with making an assessment not just for citizens at this point in time but for many years ahead.

I know that the Secretary of State, the Minister and his colleagues are fully aware of the weight of this responsibility and I have read his considered view in the justification documents. The Secretary of State responded to the concerns raised by using evidence from a number of studies. I invite the Minister to say something further about the relative risk and the Secretary of State's assessment.

In its submission to the Merits Committee, Greenpeace raised a number of issues about which I hope the Minister can say something, but I draw one specific issue to his attention; namely, whether decisions on justification are compatible with the European Convention on Human Rights, given they are “practice as a whole” decisions and have a wide ranging impact.

On the third SI, on nuclear decommissioning and waste handling, the Minister will understand why I want to probe the amendments made to the impact assessment. I understood an impact assessment to be a statement of fact, so I was surprised to receive notice of a change. In the original impact assessment, at several points under what was then described as the “do nothing” option, which is now called the “correct base case”, it was stated that the cost of verifying the information provided by operators in the funded decommissioning programme, or FDP, “would fall on Government”.

The new impact assessment states that there shall be no subsidy to new nuclear power stations and that operators should pay all costs. The reason for the change is that government policy is not to provide any subsidy to new nuclear power stations. The new policy is that the Government would seek to agree with the operator to recover reasonable costs incurred by the Secretary of State when verifying the information contained in the FDP. But the impact assessment adds:

“Although we would not be able to compel the operator to agree such terms, it would be likely to be in their interests and so we view it as quite likely that the costs of verification would not fall to Government”.

Is the coalition Government's policy of no subsidy now reduced to “quite likely” and only with the agreement of the industry? What discussions have there been with the industry on this change? What is its view? How likely is “quite likely”?

I have raised this issue previously, following some confusion about the Secretary of State's view. I am therefore grateful to the Minister for the letter I received shortly before I came to the Chamber today, giving further advice and information on the issue of subsidy. I am trying to get an understanding of what the Government mean by “no subsidy”, and the Minister’s letter is very helpful in that regard. He could help me further by explaining whether the change in policy still gives the industry the confidence it needs to progress. I would be grateful for the Minister’s guidance on this. I know he shares the commitment on this side of the House to ensure that the power stations are in place by 2017.

Taking a broader examination of this statutory instrument, we need further clarification, over and above the Energy Act 2008, of what operators will be expected to provide in applying to build and operate nuclear power stations, which will clearly not be covered by the public purse. I listened carefully to the Minister’s comments today, and I admit to some confusion and not fully understanding a couple of points. On the funded decommissioning programme, I am not clear exactly what is involved. Is it the case that the operator must deposit and show that funds are available for the construction and the subsequent maintenance of a storage site—prior to eventual underground storage—and all the costs of preparatory activity before decommissioning? If this is the case, it is a substantial undertaking. I think the noble Lord, Lord Teverson, raised that point as well. On the storage issue, it would certainly outlast the lifespan of those giving the undertaking. I may be wrong—which is why I am seeking clarification—but it looks as if this is a tightening of what is defined as “no public cost”. If it is, has it been discussed with the industry, and what was the reaction of the industry? The point I am trying to get back to is the confidence that the industry can have in the process moving forward.

My final point—I saw the Minister raise his eyebrows then—is whether the Minister can provide an update on what comes next, including the energy market reform. We have the road map showing the date for new nuclear to be in operation by 2017. However, as I have outlined today, there are a number of hurdles still to be cleared, and market reform is not in the Bill to come before us shortly. Does the Minister think it will be necessary to amend the road map, or is he confident that the issues I have raised today have been fully addressed and that there will be no further concerns?

I am sorry for having spoken slightly longer than I had intended, but there were a number of issues on which I wanted clarification. I know that the Minister has a personal commitment on these issues, and we all want to ensure that there can be confidence that they have been fully examined by your Lordships’ House.

My Lords, I am very grateful to everyone who has spoken. This is a great day for the nuclear industry, and I am delighted. Unfortunately, everyone who has spoken seems to have left, which says a lot for my winding-up speech. I am very grateful to the noble Baroness for sitting there and listening to what I have to say. Perhaps she can report it accordingly. It is a great day for the nuclear industry, and I am very grateful to the noble Lord, Lord O’Neill of Clackmannan, who is a terrific exponent as chairman of the NIA, for his kind words in saying that it is a great day. I think this clearly sends confidence to the industry that we are determined to get the nuclear show on the road. We have had 13 years without the nuclear show on the road. I am grateful to the previous Government for helping to change public opinion, but we have had no activity, and we now have activity. As always, the noble Lord, Lord O’Neill, makes good points in everything he says on this issue, because he is an expert. He is a pleasure to work with on this subject. He makes good points about waste, the economic benefit perhaps of economies of scale working with government and with civil waste, and I take those messages on board. The noble Lord, Lord Jenkin, again talks about confidence. The first two statutory instruments clearly demonstrate that there is confidence and that we are going down the road for it. Both he and the noble Baroness have asked questions on the subject of the NII. I take on board her comments, asking us to get on with sending a clear route map of what we need to do. The Government have been considering two options for the reform of nuclear regulation, as was said at Question Time last week—a discrete agency within the HSE or a stand-alone, statutory corporation. This is a discussion between two departments, and I assure the noble Baroness that we are pushing very hard for a conclusion on it.

The noble Lord, Lord Teverson, made a series of excellent points, as always. He talked about spent fuel and the levels of waste not being defined. They are defined in the regulations, in the companion instrument to this order, and I should be happy to have my staff take him through those pages, because I shall not be able to do it myself.

It is all very well the noble Lord asking questions, but he should know the answer to them.

One question is why we should designate interim stores. Operators must provide for interim stores during the life of a station and it is essential to ensure that the money is set aside. I was asked whether the funds were secure. Yes, there is protection in the funded decommissioning programme and in the Act itself. Funds must be remote from the operation of the Government. Neither party, including the Treasury, can get its hands on it. That was the concern.

The two reactors are hybrids and based on the foundation of reactors already in use. Obviously, they are not the same, because the people who make them are continually trying to improve on them and technology is moving forward on that. The noble Lord asked whether other reactors would require approval. Of course they would—as, indeed, would a Mox plant, as it does not fit within this legislation.

I thank the noble Baroness, Lady Smith, very much for her co-operation in this particular SI. She let me know in advance about some of the matters of concern affecting her Benches, and I am grateful for that level of co-operation. We are trying to build a consensus and get the ball rolling as quickly as we can, and it is very welcome that on all sides of the House we seem to have a common theme. I thank her very much for that.

The noble Baroness asked whether we have considered whether there should have been an inquiry. Over three years we have had the three consultation processes that her own Government instigated, which I think is pretty exhaustive in the current circumstances. She asked whether we were on track; we are, and we have published the timetable on the DECC website. If she has time available, we would be happy to show her how to get on to it. We can keep her posted through that means.

That is very gratifying, because I do not. Perhaps she would not mind telling me about the changes that are going on at the moment.

I am extremely grateful to the noble Lord, Lord Myners, whom I much enjoy bumping into on the street every now and then. I hope that his dog is fine, and all the rest of it. I admire his honesty for saying such honest things about me, so it is a mutual appreciation society here. On the last question, noble Lords say that they are concerned, rightly, that there may be a legal challenge. We obviously feel that our case is extremely robust, or we would not be here now trying to get these regulations through.

The question I was asking about judicial review or possible legal action was not on whether the case were robust. I have read all the documents and I am sure the Minister is convinced that his case and the work undertaken have been robust. The point was specifically whether legal actions would significantly delay the process beyond 2017. He may want to check on that. If there were legal actions, would that delay the process?

Clearly they would delay the process. A legal challenge is what it says, and would delay the process, but there is no sign of it at the moment so we hope that it will not happen. As the noble Lord, Lord O’Neill, said, not everyone agrees with nuclear as being the future and we know who some of those people are. Through a consultation process over three years, with three types of consultation at least, you try and get to a hard edge on it.

I turn to the human rights issue that the noble Baroness raises. We believe that all human rights issues are compatible with legislation. On her point about no subsidy, I will repeat what my right honourable friend the Secretary of State has said—that no subsidy means,

“that there will be no levy, direct payment or market support for electricity supplied or capacity provided by a private sector new nuclear operator, unless similar support is also made available more widely to other types of generation”.—[Official Report, Commons, 18/10/10; col. 45WS.]

That clearly gives opportunity for a watering-down, because if similar support is made available more widely to other types of generation then obviously we will consider it from a nuclear standpoint. I hope that answers her concern in that area.

I apologise for intervening again on the noble Lord; he has been generous in giving way yet again. He goes a long way to answering the point. The point I was asking was particularly on the waste disposal area and on the funded decommissioning programme, because no other process of energy generation allows for waste in that way. I was particularly referring to the order and the FDP. It seemed to me that it was tightening up the issues around any subsidy available and all costs would fall on the operator. Has this been discussed with the industry and what is its reaction?

If I understand the noble Baroness correctly, the cost for provision for waste falls on the operator, who has to—as I have answered the noble Lord, Lord Teverson—provide funds at all stages of the decommissioning. That includes storage and the final decommissioning. They are fully aware of it. Clearly, we have not got to where we are now without consultation with all the operators. They understand the rules of engagement—I am not going to say they are happy with them, as I cannot immediately tell you that—and these rules are the way we are intending to proceed.

I hope the noble Baroness feels that I have answered the majority of her questions, if not all of them. As always, it is good to have a lot of questions as this is an important step change that we are making for the future of the nuclear industry.

I think my noble friend may be about to move off the questions. I did ask about these types of approvals in other European member states and how they had seen these reactors. I should have given the Minister notice of that question and I apologise that I did not. If he could write to me with any information on that I would much appreciate it.

I felt that I had answered the noble Lord’s questions. These are obviously hybrids and there are similar types of reactors in Finland and France, which form the basis of these operations. If he feels that is not an adequate answer, however, I shall write to him later on the subject, if I may.

We face major changes in moving to a low-carbon economy. There is an urgent need for a diverse range of new energy infrastructure with a massive expansion in renewables, as well as more new nuclear, clean coal and gas. All of this will help us to reinforce our domestic security of supply. Regulatory justification is one of the facilitative actions necessary to enable new nuclear power stations to be built in the UK. It requires an assessment of whether the benefits of building these nuclear reactors in the UK outweigh the radiological health detriment that they may cause.

These instruments give effect to our decisions that the benefits, including the contribution which new nuclear power stations can make to ensuring secure, low-carbon energy supplies, outweigh the detriments. For that reason, they are very important measures. The provisions in the draft Nuclear Decommissioning and Waste Handling (Designated Technical Matters) Order 2010 are an important part of the statutory framework for the financing of nuclear waste and decommissioning, and another of the facilitative actions necessary to enable new power stations to be built in the UK. I commend these regulations to the House.

Motion agreed.

Justification Decision (Generation of Electricity by the AP1000 Nuclear Reactor) Regulations 2010

Motion to Approve

Moved By

That the draft regulations laid before the House on 18 October be approved.

Relevant documents: 4th Report from the Joint Committee on Statutory Instruments, 10th Report from the Merits Committee.

Motion agreed.

Nuclear Decommissioning and Waste Handling (Designated Technical Matters) Order 2010

Motion to Approve

Moved By

That the draft order laid before the House on 18 October be approved.

Relevant documents: 4th Report from the Joint Committee on Statutory Instruments, 10th and 12th Reports from the Merits Committee.

Motion agreed.

House adjourned at 7.02 pm.