As this is the first morning sitting under the new arrangements, it may be a help to Members if I make one or two points clear and for the record.

First, the House will have noted that times for each debate have been printed on the Order Paper. That means that the practice on the former last day Adjournments will be followed—that, if the House gets ahead of the timetable and the Member opening the next debate is not present, the occupant of the Chair will be able to suspend the sitting until, but not beyond, the stated time.

Secondly, I propose for the three half-hour debates to follow the practice to which the House is accustomed with the half-hour Adjournment at the end of each day's sitting—that no additional Member may take part except with the permission of the Member introducing the debate, and the Minister, and of course the Chair, should be informed.

rose—

Hear, hear.

The House is far more crowded than one would usually expect during an Adjournment debate, and it is most unusual for my standing up to arouse a cheer as well, but perhaps we are making history in more than one sense today.

There is a certain irony in my luck in coming top of the draw, as I was one of those hon. Members and right hon. Members who voted against the change. Perhaps, Madam Speaker, either you or the gods are getting their own back by ensuring that I have to be here at 10 o'clock on the first Wednesday.

The second comment that I wish to make before I reach the substance of the debate is that, as you know better than I, Madam Speaker, and I am sure that the Leader of the House also knows, the House has sat on Wednesdays in recent times, although not regularly since 1967. The last time that the House sat on a Wednesday morning was on an overspill on the Consolidated Fund Bill debate—something that can no longer happen—on 28 March 1990.

The House decided to meet on Wednesday morning of 1 August 1984 because the House was going into recess. That is an interesting date also because now we do not reach August before we go into the summer recess. It is a sign that the times have changed with the Government. They want us out of the way now, rather than keeping us here in the House.

The House also met on Wednesday 7 November 1990, for the Queen's Speech. However, the last time that the House met regularly on Wednesday was on 25 October 1967, well before my time in the House, and I am sure a few years before your entrance, Madam Speaker.

I asked the Journal Office to obtain for me the front page of that day's Hansard, and it is obvious that some things never change, even though we may change our proceedings from time to time. After Prayers, the House started with a ten-minute Bill, the Travel Concessions for Seamen Bill, moved by Mr. Hector Hughes, who was then the Member of Parliament for Aberdeen North. It will not surprise the House to know that it was critical of British Rail. Hon. Members criticised British Rail for removing the travel concession for seamen going home after arriving in port; so that, as is habitual, British Rail was being criticised 27 years ago, as it is today.

The main item of business under the Orders of the Day—is shows how important those issues were then—was the Sea Fisheries (Shellfish) Bill. Some names to conjure with: Mr. Graham Page sought to move amendments, as did the then Mr. Ronald Bell; so there are some links between now and that time, 27 years ago.

I am delighted to be able to open the first Adjournment debate. I think that it does credit to you, Madam Speaker, or to the ballot, that we should be able to have a debate that is of real significance to this country's national interest and to the position of the poorest countries throughout the world.

The Pergau dam affair shows all that is wrong with the way that Britain gives its aid to some of the less poor countries of the world. To me, and I am sure to many other hon. Members, the affair still leaves a nasty taste in the mouth. Despite protestations to the contrary, it will always, to me and to others, be associated with aid for arms.

The Foreign Secretary has admitted, in his own singular phrase, to a "brief entanglement" between arms and aid in 1988. I have taken an interest in the issues of Bosnia and Europe generally over the past few years. One of the things about the Foreign Secretary is that he can always come up with a neat phrase. The tighter the corner he is in, the smarter and neater the phrase he comes out with.

To me, the phrase "brief entanglement" implies something a bit more than just a short time span. The then Secretary of State for Defence—the scion of the Scottish industiral family—made an error when he went to Kuala Lumpur in 1988 to negotiate arms and offered aid on the side. But in the Foreign Secretary's phrase, the affair was a "brief entanglement". There are those—mainly Opposition Members—who believe that the project would not have been proceeded with without the arms connection. To me it is a long affair, not a brief entanglement.

The case is also a bad deal for the United Kingdom taxpayer, and arguably a bad deal for the Malaysian electricity consumer. Funding the project by soft loans has increased the charge on the United Kingdom public purse by approximately £56 million more than if the project had been funded by a method of mixed credits. It has been estimated—I presume that the estimate is correct as I am not aware that its validity has been questioned--that Malaysian electricity consumers will pay £100 million more than if the electricity was generated by gas turbines. In economic terms alone, the project should not have been proceeded with.

Great credit is due to the World Development Movement for its courage in taking the Foreign Secretary to the High Court to seek a judicial review on his 1991 decision. We all know the outcome—the High Court agreed that the Foreign Secretary had acted unlawfully. We now know—because of the Foreign Secretary's statement and his response to questions on 13 December 1994—that the Government had no intention of appealing against that decision.

Will my hon. Friend give way?

I shall give way when I have finished making my point, but other hon. Members want to speak, and we have only one and a half hours for debate.

The Foreign Secretary must go further than his statement to Parliament on 13 December, and make two matters absolutely clear. First, he must state clearly that the Treasury will not be allowed to cut future spending allocations to the budget of the Overseas Development Administration in order to claw back future payments for the Pergau dam. The Foreign Secretary has already given that commitment for this year and for 1995–96, but his commitment must go further still to cover the lifetime of the project—for the next 10 to 11 years.

Secondly, the Foreign Secretary must give a commitment to repay fully the aid budget for all past spending, both on the Pergau dam and on the other three projects that might be deemed to be unlawful, and thus reverse the decision that he gave in the House of Commons on 13 December.

I am grateful to my hon. Friend. On the illegality of the Secretary of State's action, does my hon. Friend agree that, if a local councillor had been found guilty in a court of law of misappropriating more than £20 million of public money for an unviable project against the advice of a senior official, that local councillor would almost certainly be surcharged, probably be banned from office for many years, if not for life, and almost certainly be bankrupt? Yet the Secretary of State for Foreign and Commonwealth Affairs carries on almost regardless. Should he not, in all honesty, resign?

I agree with my hon. Friend's conclusion. Clearly, the Foreign Secretary should resign, together with all his Cabinet colleagues. To be fair to the Foreign Secretary—I am not usually fair to him—the High Court ruled that he acted unlawfully in using that piece of legislation. It did not rule that he was unable to provide funds to allow the project to go ahead. We are discussing the legality of the action under the 1980 legislation, not whether the Government had the right to provide money, which they clearly did. They simply chose the wrong vehicle to do so.

I was in the Chamber when my hon. Friend put the same question to the Foreign Secretary in person, and the response that I have just given was far more convincing than the one that the Foreign Secretary gave to my hon. Friend.

The Government's justification for the non-reimbursement of funding for previous years is that the aid and trade provision of the aid programme for previous and future years was set on the assumption that the cost of the Pergau dam and the three other projects would be met from it. In the Foreign Secretary's words,

"the books for those years are effectively closed".—[Official Report, 13 December 1994; Vol. 251, c. 774.]

That is another neat phrase.

Books are either closed or not. What does he mean by "effectively"? Does he mean that, if pressure is exerted, the books could be reopened? Is he already anticipating his response when my hon. Friend the Member for Eccles (Miss Lestor) says to him, "You have been under pressure from the High Court or other quarters and have had to reopen the books; how does that tie in with your commitment of 13 December 1994?"?

I can already see the Foreign Secretary, in his usual languid manner, rising at the Dispatch Box and saying to my hon. Friend the Member for Eccles, "I said that the books were effectively closed." Perhaps that phrase means one of two things—the books are closed and cannot be reopened, or the Foreign Secretary is making an escape route for himself for the time when sufficient pressure is placed on him that the books have to be reopened and the payment repaid.

I think that we all accept that the reason that the Foreign Secretary has given and the arguments advanced by the Government amount to pathetic excuses. The Government's unlawful decision prevented lawful aid and trade provisions from going ahead—only one third of the ATPs put forward for 1990–91 were proceeded with. If the Pergau dam project had not been approved, the way would have been left open for lawful ATPs. If the House did not wish to do that, the resources could have been put into the mainstream aid budget.

As a basic principle, the money which was spent illegally must be returned to the aid budget. If that is not done, the Government will have spent resources set aside for aid on non-aid purposes, in blatant disregard of the wishes and the authority of Parliament. The £24 million that was spent on Pergau could make a significant difference to the quality of life in a poor country.

The Pergau dam affair has cast a shadow over the credibility of our aid programme which must be removed. I believe that we should take this opportunity to review overseas development administration policy as it has not been reviewed comprehensively since the 1975 White Paper. My view—I believe that it is also increasingly the view of my party—is that our aid, both bilateral and multilateral, should be targeted at the poorest people in the poorest countries.

We should never forget that 1.2 billion people continue to live in poverty throughout the world. If we are to help to eliminate that poverty, we must give increased priority to the provision of basic education, primary health and safe drinking water—just three objectives among many. I contend that £234 million would provide a great boost to that policy development.

I rise on this important and historic occasion with a great deal of pleasure. Madam Speaker, you will recall that this Wednesday morning sitting—which I hope will be the first of a permanent series of such sittings—results from the unanimous recommendation of the Select Committee on Sittings of the House, which I had the honour to chair.

The four different types of private Members' business—the Consolidated Fund Bill debate, with its absurd all-night sittings which are hopefully now behind us; private Member's motions; Adjournment motions; and the last day Adjournment debates—can now be dealt with in the four-and-a-half hour sitting of the House every Wednesday morning. That is a very neat way of putting private Members' business on a regular footing, instead of dealing with it hurriedly just before a recess. It is a far more satisfactory forum for hearing hon. Members' concerns, and it is much more sensible for us to debate an important issue like Pergau at this time of the morning rather than at 4 am, as we probably would have done previously.

The hon. Member for Leicester, South (Mr. Marshall) referred to the parliamentary sittings in 1967. I may have been in the Chamber during the debate to which he referred—I recall taking part in the morning debates during the Crossman experiment. That experiment failed because the House was not prepared to accept those arrangements, and because the business which Mr. Crossman put on the Order Paper was much too controversial.

There is always a temptation for people to monkey about with controversial business, which is what happened in the 1960s. We are now accepting relatively non-controversial business on motions for the Adjournment, and I believe that that will prove very satisfactory for the House.

I am a member of the Foreign Affairs Select Committee, which held a number of hearings and produced a report about the Pergau dam affair late last year. I want to refer to the events leading up to the court's decision about the legality of the payments for the construction of the Pergau dam under the Overseas Development and Co-operation Act 1980.

The whole sorry saga of the Pergau dam began when my noble Friend Lord Younger, as he is now, signed the protocol in March 1988 in Kuala Lumpur. He maintains to this day that he did not do anything wrong, and he gave advice to that effect to the Select Committee. He said that he thought that the wording of the protocol was appropriate, and did not link aid with arms expenditure. However, the Foreign Office and the Government disagreed with that view, as did the Select Committee in its report. We felt that it was wrong for Mr. Younger to sign the protocol at that time.

The signing of the protocol has had a domino effect. I reflect the criticism in the Select Committee report when I say that I cannot understand why the Foreign Office or the Ministry of Defence allowed the protocol to be signed. The Foreign Office was totally ignorant of what was going on. The actions of the British high commission in Kuala Lumpur were totally disgraceful. It appeared to know very little about the reason for George Younger's visit to Kuala Lumpur, and it then failed to inform the Foreign Office what he had signed until some weeks after his return to this country. That is a lamentable state of affairs.

The whole project was appraised in a bizarre mission between 12 and 14 March 1989. Sir Tim Lankester, the permanent secretary, said—it appears in the Select Committee report—that the mission was "wholly unsatisfactory", and described it as a "lamentable slip-up." I agree with him. It is all very well for Sir Tim Lankester to complain about the viability of the scheme after the event; I think it is a pity that people within the Department did not pay more attention to the conduct of the scheme's appraisal and to the legal basis of the expenditure, which has since been overturned by the court as contrary to the provisions of the 1980 Act.

The events surrounding the Pergau dam affair have not been helped by the machinations of the consortium of contractors. The Select Committee was critical of those contractors, and I think that their behaviour does them little credit. Having said that, I entirely understand why it was impossible to stop the Pergau dam project dead in its tracks once the first mistake of signing the protocol had been made. That could have had massive ramifications for our relations with Malaysia—which are delicate at the best of times—and badly affected our important trade with that country. Undertakings had been given by the then Prime Minister, Mrs. Thatcher, and I believe that the Government were right to uphold the undertakings which were given at that time.

I now turn to the issue at the core of what the hon. Gentleman is raising in his one-and-a-half hour Adjournment debate—the judgment of the courts, which nobody really anticipated. The hon. Member for Falkirk, West (Mr. Canavan), who interrupted the hon. Member for Leicester, South, is also a member of the Select Committee for Foreign Affairs.

If he were still in his place, I am sure that he would agree with me, as would my hon. Friend the Member for Broxtowe (Mr. Lester), who is also a member of the Select Committee, that, although the World Development Movement told us that it considered the payment to be illegal, nobody else, on or off the Committee, also reached that conclusion. Although we heard what the World Development Movement had to say, none of us set very much store by it. The World Development Movement was right, however, and the rest of us were wrong.

Returning to the intervention by the hon. Member for Falkirk, West, he sought to link the court case, which was about the legality of the payment under the 1980 Act, with the advice and the objection by Sir Tim Lankester, which was based purely on the viability of the scheme and had nothing to do with the legality of the payment. Those two issues are quite separate, and I wish that the hon. Gentleman were still in his place so that he could hear me say that.

If the right hon. Gentleman checks back on parliamentary questions that have been tabled over a number of years, he will find that a number of my right hon. and hon. Friends questioned the legality of the project.

I accept that there have been questions which suggested that. I would guess that those questions might have been inspired by conversations with the World Development Movement. I do not think that there was any advice in or out of the Select Committee to the effect that the payments were illegal, except from the World Development Movement. Therefore, the judgment was a surprise.

I applaud the statement of the Government, complying with the judgment of the court, that money will be found from the reserves—£34.5 million this year and £31 million next year—to put right what the court has said was wrong, and that seems adequate.

Referring to previous years, I am not clear how and whether it would be appropriate or sensible to reopen previous years concerning the £24 million. It seems to me that that is water over the dam, and I could not support pressure to make the Government find that £24 million as well. Of course, the World Development Movement is doing everything it can—it may go back to court, for all I know—to insist that that £24 million is found, but those books are closed. They refer to years gone by and I should be very surprised if it were possible to find that money.

The third part of the money is in future years, and that has also been referred to in the debate. There is no way in which the Government can commit themselves—before we have entered into the specific public expenditure survey rounds—to be absolutely clear about what will happen in 1996–97, but when the Foreign Secretary made his statement on 13 December, he pointed out that the overseas aid budget is to increase by £56 million in 1996–97 and by £115 million in the following year. That will be the baseline for discussions at that time.

Finally, I want to say a word about the aid and trade provision. We should remember that it was introduced by the Labour Government in 1977. We ought also to recall that only 6 per cent. of our aid budget—rather less, I think—goes on ATP and, what is most important, since the Pergau affair the rules have been changed and it would be impossible for Pergau to be financed now to ATP, as it was then.

I am glad that the Select Committee report endorsed the use of ATP, and was not in favour of its abolition. ATP is a very good scheme. I welcome the use of the aid budget to encourage British trade and the preservation of British jobs.

Although the Select Committee was not in favour of an extension of it above 6 per cent., I would not object at all if the ATP budget were increased. It would be to the advantage of British industry, as ATP has had very good effects and repercussions on jobs and industry in this country. It is a pity that the statistics are not sufficiently clear for us to be precise about just what advantages have been gained over the years from the ATP provision.

With those remarks, I look forward to hearing what my hon. Friend the Minister has to say. In particular, I think it would be interesting if he could give us some an idea of how the extra £34.5 million this year is likely to be spent. The Foreign Secretary referred to Bosnia, but there may be other provisions, and I am sure that the House would like to know where the money is going.

I first congratulate my hon. Friend the Member for Leicester, South (Mr. Marshall) on obtaining his debate on this historic first Wednesday morning sitting, at least for a number of years. I am pleased to follow the right hon. Member for Westmoreland and Lonsdale (Mr. Jopling), who is responsible for us sitting on Wednesday morning. I am glad to see him here today, and look forward to seeing him regularly on Wednesday mornings.

I also emphasise that my hon. Friend the Member for Leicester, South, who so ably put his case today, has the total support of those on the Opposition Front Bench in the arguments he put forward.

In the Labour party, support from the Front Bench counts as a novelty.

The Minister will have the opportunity to speak later. He is noted for his sarcasm rather than his humour. My hon. Friend has the total support of the Opposition in seeking the debate, and in everything he said.

Today's much-needed debate on repayment of the money that was so scandalously wasted on the Pergau dam is an issue that, contrary to what Ministers and Conservative Members say, is in no way resolved. It may seem to the Foreign Secretary, a small discrepancy in his bookkeeping, but, to millions of people throughout the developing world who are dependant on British humanitarian aid, it can mean the difference between life and death.

The Pergau dam affair, from the original infamous entanglement of arms sales and aid, arising from the improper deal signed by Lord Younger on 23 March 1988, all the way through to the High Court ruling and the Foreign Secretary's stubborn refusal to accept it, has been one of the sorriest sagas of this discredited Government.

On 9 and 10 November last year—nearly three months ago—the High Court heard the World Development Movement case for a judicial review of the Foreign Secretary's decision. The WDM deserves the thanks and congratulations of the whole House for that action. The challenge to the Foreign Secretary's decision was based on the Overseas and Development Co-operation Act 1980.

The judgment held that the Foreign Secretary's decision was unlawful, and that future payments from the aid budget were to be halted. We do not congratulate the Foreign Secretary on doing that, because he was so instructed by the High Court. Equally important, the High Court instructed the Government to reveal to the World Development Movement how they intended to put right the aid payments made so far.

By comparison, the Government quickly stated their intention to meet their contractual obligations to Malaysia, no doubt under legal threat from its Prime Minister, Mohatmir Mohammed. However, the High Court ruling explicitly stated that the WDM must be informed how the Foreign Secretary planned to make good the overseas aid budget. When will it receive a similarly quick response? It still awaits one. Once again, the interests of British companies and of trade relations with Malaysia have taken precedence over the needs of the developing world.

In the House, the Foreign Secretary first ignored many legitimate requests for his resignation, and even mild requests for an apology for the unlawful action that had been taken. Now, the right hon. Gentleman is blatantly attempting to avoid the implications of the judgment. The High Court specifically instructed the Foreign Secretary

"to take appropriate steps to make good the deficiency in the overseas aid budget."

It could not have been clearer.

The Foreign Secretary had the gall to tell the House that he believed that not paying back the £24 million that unlawfully went to Malaysia in that "brief entanglement" as he described it, was "an equitable way" of dealing with the difficult situation that had been created. That is unbelievable. The right hon. Gentleman's view of what is equitable is of no great relevance to the House, and his view of the matter has been shown by the High Court to be fundamentally flawed, and an insult to right hon. and hon. Members and to the British judiciary. Above all, his view is an insult to the people who desperately need the £24 million that the Foreign Secretary is so anxious to keep.

The Labour party is not opposed to the aid and trade provision. We were reminded today as on previous occasions by the Under-Secretary of State, with his usual sarcasm—

The hon. Gentleman mistakes humour for sarcasm.

It may seem like a sense of humour to some people, but it seems like sarcasm to this side of the House. We do not need to be reminded that a Labour Government introduced the aid scheme. We are proud that Judith Hart introduced it in 1978, but that is not the scheme currently pursued by the Government. The original scheme was intended to allow a small proportion of bilateral aid of about 5 per cent. to be available, to give higher priority to the commercial importance of a limited number—these are the key words—of "developmentally sound projects."

We find objectionable the systematic abuse and corruption of the scheme under a Conservative Government to satisfy Tory central office, the awarding of tenders to companies donating large sums of money to Tory party funds—no doubt to pay some of the heavy legal fees that it must reimburse The Guardian and other newspapers, manipulation of the aid budget to further the sale of British arms and the financial interests of the Government's family and friends, and the Government's refusal to admit dishonesty and at least attempt to make amends.

The legal basis for aid payments was agreed by the House in 1966 and 1980. It gives the Foreign Secretary to authorise aid payments, but only

"for the purpose of promoting the development or maintaining the economy of a country or territories outside the UK, or the welfare of its people".

That was not the purpose of the Pergau dam. As the Foreign Secretary told the Foreign Affairs Committee, there were "wider considerations", such as

"a clear understanding at the highest level"

and

"the interests of British industry."

Ironically, the Committee and the Overseas Development Administration's own study of the programme showed that it will not create jobs or orders for British industry, so it cannot be argued that Pergau would help in that way. It boils down to

"a clear understanding at the highest level"

I cannot believe that George Younger, who was Mrs. Thatcher's leadership campaign manager, did not have his leader's words ringing in his ears when he signed that fateful arms-for-aid deal in 1988. It was not for nothing that Mrs. Thatcher was nicknamed by a former Leader of the House

"she who must be obeyed."

The following year, on 15 March 1988, Mrs. Thatcher met the Malaysian Prime Minister and sealed the deal on the basis of incomplete information about the cost to the British taxpayer. Over the next two years, it became clear that the Pergau project was not developmentally sound but uneconomic and, in the words of the ODA's own appraisal, "a very bad buy" for Britain and

"a burden on Malaysian electricity consumers."

In 1991, the ODA's Permanent Secretary, Tim Lankester, and the Minister for Overseas Development, Lady Chalker, reached the conclusion that the project was not sound, yet on 26 February 1991, after consulting the Prime Minister, the Foreign Secretary gave his final approval.

Why did the Foreign Secretary do that, against all professional and, I believe, legal advice? Why did he approve a project that would help neither British jobs nor Malaysian consumers? We should not be surprised that he did, when we realise that nearly all the companies that benefit from ATP donate to Tory party funds. We should not be surprised, because of the particular interest taken in Pergau and in the Ankara metro project by the then Prime Minister. Despite all her other tasks, she took a particular interest in those two projects.

When I asked the Minister what other projects the Prime Minister had asked to be put on her desk, he said that it would cost too much to tell the House. It is time the House knew of all the ATP and other projects that found their way on to Mrs. Thatcher's desk before they were approved.

Because of her special relationship with the Malaysian Prime Minister, she was also keen to see British arms sales to Malaysia proceed. One hon. Friend pointed out to me that a report in The Times today says that our Export Credits Guarantee Department programme is distorted by high expenditure on the arms trade. Although the Prime Minister formally de-linked the "separate but parallel letters", there was still a strong relationship between them. The Prime Minister might also have had a close family interest in the project.

Downing street's involvement in reviewing ATP projects is particularly disturbing. The overruling of countless officials, discontent of Cabinet Ministers, protests of non-governmental organisations and press editorials were all ignored by the Government. It took action by the World Development Movement in the High Court to force the Foreign Secretary to admit that he had acted illegally in spending aid money on Pergau. A further refusal to abide by the judgment and to repay the money has caused unmitigated outrage, and rightly so.

The case for repayment is straightforward. The Foreign Secretary has used the lame excuse that the books for previous years are effectively closed. However, it was made clear in response to a question put to the Foreign Secretary's counsel in a preliminary hearing that provision existed for retrospective rearrangement of funds. In other words, the Foreign Secretary's representative said that the books could be reopened, and they should be. It seems that the interpretation of the laws of the United Kingdom depend on which side of the law the Government are operating on.

The Foreign Secretary also stands accused of contempt of the authority of Parliament. He seems to be of the opinion that the aid budget was set on the assumption that the Pergau project would be financed from within it, so provision would have been less if the project had not been included. However, the House did not vote on individual aid and trade projects when it voted for the aid budget in 1991. The ATP allocation appears as a total figure, not as a list of individual projects. Parliament voted the ATP money on the assumption that it would be used for genuine developmental projects. That has not been the case. The House has been ignored.

The money refused by the Foreign Secretary also provides a compelling argument for its return to the aid budget, which has fallen to 0.3 per cent. of gross national product. The bilateral aid budget has declined, and it desperately needs the money that could come, as it were, from the Pergau project. Africa and all poorer countries of the world desperately need the money.

In conclusion—that will please Noddy, the Government Whip. Even more important, Madam Speaker, it will please you.

I have an interest in Back-Bench Members.

So do I, Madam Speaker.

The Pergau dividend, which was successfully won by the World Development Movement, could be used to fund many grass-roots projects which have disappeared from the forefront of British aid.

The Government must be aware that any attempt to cut the aid budget in other areas will be vigorously opposed by the Opposition. Attempts at retribution by the Foreign Secretary will not be accepted. The Labour party wants—indeed, demands—that the money misappropriated from the aid budget be immediately restored. The restoration of credibility to the United Kingdom's aid programme is badly needed to remedy what has become one of the most sickening examples of the susceptibility of this discredited Government.

The only thing that will satisfy the House, non-governmental organisations and the law is that the future payments earmarked for the Pergau project be targeted on the poorest people in the poorest countries—in other words, not only the £24 million that has previously been wasted on the project.

The Minister must say how the Government intend fully to implement the decision of the High Court. If not, it will be open to the World Development Movement, as the right hon. Member for Westmorland and Lonsdale rightly said, to return to the High Court to seek legal redress. The Opposition would encourage the WDM to take that action, to ensure that the Foreign Secretary is made to obey the law of the land.

The hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) spoke from the Opposition Front Bench in his usual colourful, florid and inaccurate way to try to build up a case that was out of all proportion. I have spent 20 years in the House using my energy to improve the transfer of resources from this country and other developed countries to developing countries, for the relief of poverty and for the integration of the world economy, and I speak from that background.

The Select Committee on Foreign Affairs took an enormous amount of evidence on this controversial issue, made recommendations and identified areas of concern. There is no point in a Select Committee taking that course if Opposition Front-Bench spokesmen repeat assertions that have been disproved, including links between arms and aid, and continually repeat charges that have been clearly demonstrated by others, including Opposition Members who sat on the Select Committee, to be untrue. The Select Committee examined the matter with considerable concern, including aid and trade provision.

It is interesting that Malaysia, which was a very poor country and qualified for ATP when the Pergau dam was authorised, no longer qualifies for such provision. That is a tribute to the success of aid programme development. Countries such as Malaysia have succeeded in getting themselves into the world economy, much to the benefit of the majority of their peoples.

We recognise that ATP has, always been an extremely difficult horse to ride. It is difficult to qualify what is developmental aid and what is assistance to business men who make quotations for major projects. To my recollection, the Select Committee has considered the issue on at least three occasions and has made various recommendations. It must be recognised that, in an imperfect world, it is an extremely difficult issue.

The United Kingdom is one of the few countries that has a limit on ATP. We have limited it to a maximum of 9 per cent. of our aid budget of £2 billion. Other countries use most of their aid budget to assist their own commercial development. The United Kingdom is more restricted because we have much tighter rules than other countries.

It is a misconception that the money spent on the Pergau dam should be available for the bilateral aid programme. The hon. Member for Leicester, South (Mr. Marshall) did not make that mistake. Instead, he said that the money should be used within ATP. The changed rules limit ATP to countries with low per capita incomes and countries with much smaller projects.

My principal concern is that the concept of the dam has been much undermined by what has happened in this country. I feel that strongly. The evidence shows that there is a narrow technical argument in the Overseas Development Administration not about whether the dam should be built but about when it should have been built in terms of the Malaysian electricity cycle. It was a question whether it should be built immediately or in 10 years' time. In the end, the argument turned on who had the most interest in and knowledge of what should happen in Malaysia—in other words, whether the Malaysians should go ahead or whether ODA officials, who took an interested but narrow view, should decide when or whether it should proceed.

The hon. Member for Leicester, South talked about targeting poverty. I have seen various projects throughout the world and it is my experience that the provision of electricity in areas where hitherto there was none, such as the townships of South Africa, can do far more to target poverty—in the sense that it brings an area to life, enables factories to be built and provides a basis for jobs to be created—than projects which bring clean water, education and social services, although I do not seek to undermine those.

It is a great mistake to imagine that the provision of essential infrastructure does not relieve poverty in a positive way. It is understandable that the Malaysians wanted to develop an area of their country that had no electricity. It is understandable also that they wanted to develop a regional project. It has been a successful project. Nobody has ever suggested that the price that was eventually arrived at when the design work was done was unfair. Nobody has suggested that the dam is a white elephant. It has not been suggested that the dam will be anything but a successful project within the Malaysian electricity cycle.

That is not true.

It is true. The project is nearly finished, and it will be successful.

Harping on, moralising and repeating assertions undermine precisely what I, my hon. Friends and Opposition Members who form the all-party group seek to do. Disinformation about sleaze, linkage with arms and corruption, which is not borne out by the facts, only reinforces those who seek to oppose the transfer of resources from the United Kingdom to developing countries. and to close down the aid programme as an easy way to save public expenditure. It damages all that one seeks to do.

In the real world, one must negotiate resources with the Treasury. Our current Foreign Secretary—one of the most capable and committed Foreign Secretaries that we have had for a long time—succeeded, despite all the difficulties, in getting an increase in the aid budget. We all know about the 0.3 per cent. and the 0.7 per cent., but to get an increase in the aid budget out of a difficult public expenditure round is a matter for congratulation, not castigation. I understand that the £24 million already spent was a matter of considerable negotiation with the Treasury and the Foreign Office came out with a reasonable deal. We can all argue for perfection, but we should also argue from reality and from accurate information. I hope that I have at least tried to put the balance right in terms of the argument.

I welcome the opportunity to participate in this first ever Wednesday morning debate under the new arrangements, and I join my colleagues in congratulating the right hon. Member for Westmorland and Lonsdale (Mr. Jopling) on the part that he played in getting us to where we are.

In a way, I am glad that my hon. Friend the Member for Jarrow (Mr. Dixon) is not with us, as I know that he was not an enthusiastic advocate of the new arrangements and is even less enthusiastic about my urging that we should go yet further. I would like the House to sit on Tuesday, Wednesday and Thursday mornings and for Mondays and Fridays to be entirely constituency days. If anybody tried to suggest that I or any other hon. Member would be working only a three-day week as a result, I should have no problem in refuting that. None the less, we have taken the first steps towards more sensible hours and I am glad that we have the opportunity—

Order. I allowed the hon. Gentleman a little latitude, but he must now return to the subject.

I am happy to do so, Madam Deputy Speaker.

The aid community and, for that matter, the developing world, owes a twofold debt of gratitude as a result of the recent developments in the Pergau dam affair: first, to the World Development Movement for having the foresight to challenge the Government on spending on the Pergau dam and on the wider question of the methods by which the Government operate their aid policy, and for having the determination to see the case through to its successful conclusion; secondly, to Lord Justice Rose for his judgment of 10 November last.

Historic though that judgment was in reining in the Government's increasing tendency to act with impunity, it confirmed the trend of the courts in being prepared to dive in and swim around in those murky waters which not much more than a decade ago were regarded as the exclusive domain of the Executive. The willingness of the judiciary to allow an organisation such as the World Development Movement to pursue a judicial review must be welcomed.

If the wider result of the judgment is that it succeeds in curbing Executive power, that will meet with widespread acclaim from every direction but Whitehall as it fits into the unpleasant pattern of Cabinet Ministers having to be told by the courts that they were acting illegally—a previous Home Secretary on a deportation case and the current Home Secretary in relation to compensation for victims of crime.

My pleasure at Lord Justice Rose's judgment was tempered by the Foreign Secretary's grudging acceptance on 13 December 1994 when he addressed the House on the Government's response to the judgment. There was no contrition whatever. There was no admission of guilt and no apology. No regret was shown, except at the fact that they had been found out, which these days seems to be the only crime to which they are ever prepared to admit.

Despite failing to hold his hands up and say, as it were, "It's a fair cop, guv," in true Dixon of Dock Green style, the Foreign Secretary asked for three other offences to be taken into account, which was interesting to say the least. They were the Ankara metro project in Turkey, a television studio project in Indonesia—we could ask all sorts of questions about whether we should have relationships with countries with such human rights records—and the flight information project in Botswana. The latter two have been completed and the first will be completed in 1997.

In total, they amount to some £35 million worth of aid—relatively small beer in terms of the £234 million earmarked for the Pergau dam project, but again they form a pattern: a culture of deception, of disguised intentions with regard to aid funding, of hidden agendas and the end being held to justify the means. That is not a philosophy to which I and my hon. Friends would subscribe, particularly in regard to such an important area as overseas development aid.

In his statement on 13 December, the Foreign Secretary refused to reinstate the £24 million already taken—illegally, it emerges—from the already depleted ODA funds. In effect, as my hon. Friend the Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) said, money was effectively stolen from the poor in the developing word. Attempting to justify that, the Foreign Secretary said:

"But the aid and trade provision of the aid programme for previous and future years was set on the assumption that the cost of Pergau and the other three projects would be met from within it …It is not self-evident to me or to the Government that the Government should in consequence ask the taxpayer for additional money to allow the ODA to expand its aid activities."—[Official Report, 13 December 1994; Vol. 251, c. 774.]

In other words, those who never had it will never miss it. Let the Government tell that to the starving millions of sub-Saharan Africa, where on the ODA's own calculations the percentage of total British aid will fall from 14.4 per cent. in 1994–95 to 12.1 per cent. in 1997. If there is not a need to make up that deficit now, I do not know when there ever will be. We shall not convince the Government of the need if they can claim that the books are closed while at the same time aid to that deserving part of the world is decreased in terms of our overall aid budget.

A modest increase in aid was announced by the Chancellor of the Exchequer to take place, I believe, in 1996–97 and 1997–98. Unlike most other European Union member states, however, the Government refused to promise extra funding for the overall aid budget to take account of the need to increase European aid by 60 per cent. by the end of the century. That decision was taken at the Edinburgh summit in December 1992 and it leaves us in a disadvantageous position compared with our fellow members of the European Union.

The Organisation for Economic Co-operation and Development, which sets aid guidelines for 25 of the richest nations, recently reported that Britain was the only member among the top 12 donors whose aid budget had declined over the past 10 years. It warned that bilateral aid to poor countries—the main purpose of the total aid programme—of some £2.3 billion will be severely cut if Britain is to meet the 60 per cent. increase in EU aid without coming up with any other funding.

That target would absorb up to one third of British aid, compared with the current figure of one fifth. It is in that context that Opposition Members demand that the funding earmarked for Pergau and the other projects to which I referred, which must be reinstated, should be set. Even if the full outstanding part of the £234 million over the next decade is not reinstated, at the very least the £24 million already illegally diverted must be restored.

As my hon. Friend the Member for Leicester, South (Mr. Marshall) so eloquently put it in opening the debate, why should the books be closed for those years when it is admitted not just that a mistake was made but that the Government acted illegally? If I broke into the office of a colleague, stole something and was found guilty, I do not believe that it would be right for me to be told, "You don't have to give it back—all you have to do is to ensure that you don't do it again in the future." There is something bizarre in the Government's saying, "Well, yes, we were caught out, but we'll close the book on it," effectively pretending that it did not happen.

I was not convinced by the argument made by the right hon. Member for Westmorland and Lonsdale, who said that one cannot expect the Government to look into the future, and I agree—particularly for a Government who do not have a future. None the less, they have announced figures for increases in aid for 1996–97 and 1997–98, so they are at least willing to look that far ahead. I am not sure where they find the confidence, but they are prepared to do that although they have not been prepared to give a commitment in respect of the Pergau dam aid funding.

That has been only for this year and next year. If the Minister will not accept the Opposition's pleas, he should remember that the High Court judgment instructed the Foreign Secretary to replenish the ODA funds which had been diverted for that ill-starred project. I hope that the World Development Movement will consider returning to the courts if the Minister confirms, as I expect that he will, the Government's refusal to reopen the books and to make good the deficit that has been identified.

The retrospective rearrangement of funds, which was mentioned in court, is well merited in its own right. The arguments have been eloquently put. Under Lord Justice Rose's judgment it is obligatory, but most of all it is needed by the poor of the world, who have consistently been sold short by the Government in their aid programme despite the rises for the next two years to which I have referred.

Money was stolen from the poor of the world despite the Government's stated intention that their aid budget was to deal first and foremost with poverty. The Government must not be allowed to get away with their ill-gotten gains. Those funds should be reinstated and I urge the Minister to announce the intention to do so today.

First, I congratulate the hon. Member for Leicester, South (Mr. Marshall) on introducing the debate and providing the Government with a further opportunity to state their position on the aid and trade programme and on the particular event in question. We welcome that.

I also welcome the fact that my right hon. Friend the Member for Westmorland and Lonsdale (Mr. Jopling) was able to take part in the debate. It is due to the initiatives of the Committee that he chaired that we are able to have Wednesday morning sittings, which will be much welcomed by hon. Members. As a senior member of the Foreign Affairs Select Committee, his contribution was valid and valuable. It should be noted that he and my hon. Friend the Member for Broxtowe (Mr. Lester), also a member of the Foreign Affairs Select Committee, endorsed and supported the Government's approach to the matter.

I am delighted to see the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) on the Opposition Front Bench. I believe that this is the first time he has spoken at the Dispatch Box since taking on his new brief. I was not entirely sure who would be the Opposition's Foreign Affairs spokesman this morning as I noted that the shadow Foreign Secretary was making a speech today on clause IV. Everyone in the Labour party now has to make speeches on clause IV, even those who supposedly have responsibility for foreign affairs. The shadow Foreign Secretary may be able to explain to the Labour party that it is now the only democratic party left in Europe which—

Order. The Minister is trying my patience. He must return to his brief.

I was simply welcoming the hon. Gentleman to the Dispatch Box and pointing out why it was that only he appeared to be free this morning to take part in the debate. However, I appreciate the sensitivities in the Labour party about the debate on clause IV.

The United Kingdom has a substantial aid programme of some £2.28 billion this year, praised for its quality and focused on helping the poorest in the world. Nine of the 10 biggest aid recipients last year were poor countries in Africa and Asia. Former Yugoslavia—Bosnia in particular—was the other main recipient.

Our purpose is to help people in countries poorer than our own to improve their lives. In doing this of course we are keen to link with British companies and British consultants wherever it makes sense to do so, as we do with British non-governmental organisations such as Oxfam and Save the Children.We link with them because they can provide the advice, know-how, products, experience and expertise which can be of benefit to the development of the countries that we help. We should be proud that British money, British talent and British expertise is being devoted to help many of the poorest in the world.

The aid and trade provision was established in 1977 by a Labour Government, as has already been commented on and acknowledged. It has enabled the UK to promote development in areas where British companies have much to offer.

ATP is a successful scheme. It is successful in helping poorer countries in that the approximately £1.4 billion which has been committed to support development projects overseas has led to nearly £4 billion of British exports. My right hon. Friend the Member for Westmorland and Lonsdale asked whether we had the figure and that is it. It has led to substantial exports for the UK. That is good news for Britain, good news for UK jobs and good news for exports. It is particularly good news for those countries which have benefited from these projects. Not surprisingly, the Foreign Affairs Select Committee concluded that ATP should continue.

As the House will know, my predecessor, the hon. Member for Morecambe and Lunesdale (Sir M. Lennox-Boyd), announced in June 1993 new procedures for ATP projects. All ATP projects approved since the new procedures were introduced fully meet the criteria laid down in the Overseas Development and Co-operation Act 1980, as now interpreted by the divisional court. Following the judgment of the divisional court in co-operation with the National Audit Office, there was a review of all projects receiving finance under the aid and trade provision to see whether any of the projects approved under our previous understanding of the Act might fall outside the interpretation of the legislation given by the divisional court. Three projects raised concerns, so following the judgment it was made clear to the House that arrangements would be made for the outstanding commitments to Pergau and the other three projects to be met from funds voted by Parliament outside the scope of the Act.

As to the past, the aid and trade provision of the aid programme was set on the assumption that the cost of Pergau and the other three projects would be met from within it. The books for those years are now closed. Therefore, as the House will know, we concluded that in respect of spending on those projects in previous years no adjustment would be made to ODA's future budget. The planned aid programme for the present and future years again contains provision for all four projects. Spending on the four projects is expected to be £32 million this financial year and £32.7 million next year.

rose—

We have therefore decided that funding from the reserve will be provided to meet the costs of the four projects, thus making available an extra £32 million for the aid budget this year and £32.7 million next year for overseas development. I am sure that the vast majority of people will find that a fair, reasonable and equitable outcome. I am sure that the vast majority of right hon. and hon. Members consider that to be a fair, reasonable and equitable outcome.

rose—

That is evidenced by the fact that today's debate has been attended by only a handful of Opposition Members. This does not seem to be a House in which there is considerable doubt about whether the outcome is fair, reasonable or equitable.

One of the things that I note has not arisen in the debate, most of which I have heard, is that however much many of us might wish to see aid to the rest of the world which is in need increased, many of my constituents feel strongly that some charity belongs at home, and they see great difficulties with such increases when the Government are refusing to give money for the elderly and for many other projects. That must be taken into account. It is no good dismissing it. That is what is felt by many of my constituents.

My right hon. Friend illustrates the fact, which was commented on by my hon. Friend the Member for Broxtowe, that every year the Government have to make difficult decisions in the public expenditure survey. My right hon. Friend the Foreign Secretary is to be congratulated on the fact that this year, next year and the year after that, the overseas development budget will be increasing year on year so that we shall be able to devote more resources to helping the poorer nations.

rose—

I shall give way to the hon. Gentleman, who has been something of a yo-yo in the debate. I think that he has only been present for a short part of it, but I gladly give way to him.

I am grateful to the Minister. I am sure that he will agree that it is important to ensure that any future ATP projects are funded within the ODA's rules. Following the Pergau debacle, the ODA changed its rules: in future, ATP would be given only to countries with a per capita gross national product of less than $700. On 18 November, in answer to a parliamentary question, the Minister gave me a list of ATP projects that had been approved for funding since June 1993, when the policy changed; it included four projects worth a total of £16 million—

Order. The hon. Gentleman is now beginning to make a speech. Interventions, by their nature, must be brief.

Perhaps I may anticipate the hon. Gentleman's point. Before Christmas he issued a press release asserting that Ministers had approved projects in defiance of the policy announced in June 1993 that new ATP projects would be approved only for countries with an income per head not exceeding $700 in 1989. That policy has not been breached: the four projects to which the hon. Gentleman's December press statement referred were approved well before June 1993, as my right hon. and noble Friend the Minister for Overseas Development made clear to him subsequently in correspondence.

That is not what the parliamentary answer said.

Perhaps I could make some progress.

As far as I can see, the only organisation—apart from the official Opposition—that does not consider the Government's approach fair, reasonable and equitable is the World Development Movement. It does not consider the extra £65 million for the aid budget to be reasonable. So be it; the WDM may seek to return to court if it wishes, but I am confident that we shall be found to have acted properly and reasonably.

Will the Minister give way?

No. The hon. Gentleman made a long speech—so long that it tried your patience, Madam Deputy Speaker, and you told us as much.

We are putting the extra money to good use, as we put all the aid budget money to good use. In the current financial year it will enable us to provide, for example, additional emergency aid for Bosnia and Rwanda, and to deal with the crisis in Chechnya. We are financing general relief supplies through the International Committee of the Red Cross, the United Nations High Commissioner for Refugees and other non-governmental organisations that are working for the 400,000 people who have been displaced by the tragedy in Chechnya. Britain will give up to £1 million for international humanitarian efforts to help those injured or made homeless in the fighting; the money will be used to provide food as well as blankets, plastic sheeting and clothing to protect people from the extreme weather conditions in the region.

We shall also be able to respond to specific appeals from the UN and the Red Cross, and to work on joint projects with the World Health Organisation and other multilateral organisations which are intended to deal with primary health care needs in developing countries. Allocations for the next financial year are still to be decided, but aid for the poorest in Africa and Asia is our priority. I assure my right hon. Friend the Member for Westmorland and Lonsdale, and others who asked me about the money, that it is being put to very good use supporting our humanitarian work throughout the world.

I welcome what the Minister has said, but he has not yet told us—and he has only a few minutes left—how the Foreign Secretary will implement the court's third decision. When will he meet the World Development Movement to explain how he intends to put right the aid payments that have been made so far? That is what the court decided should be done; how will the Government fulfil its decision?

The hon. Gentleman clearly did not listen to what my right hon. Friend the Foreign Secretary said before Christmas, or to what I have said this morning. Furthermore, he obviously was not particularly well briefed by the World Development Movement. The Treasury Solicitor wrote to the WDM on 23 January, setting out the Government's position.

rose—

Sadly, the need for emergency aid has never been greater than in recent times—

On a point of order, Madam Deputy Speaker. I am aware of the existence of the letter to which the Minister referred, but has it been placed in the Library of the House? It has not been circulated, but it ought to be the property of the House as well as the World Development Movement. Surely it is improper for the Minister to refer to a letter that has not previously been circulated to hon. Members, although they are aware of it and it is central and material to the important point with which we are dealing.

I am more than happy to make the letter available, and to place it in the Library. It repeats very clearly what my right hon. Friend the Foreign Secretary said before Christmas, and what I have said today. The hon. Gentleman cannot have been listening to my speech.

As I was saying, the need for emergency aid has never been greater than in recent times. In 1993–94, we spent about £180 million on providing speedy and effective help for the victims of natural and man-made disasters. We provided help for the victims of 135 emergencies. We work together with the UN, other relief organisations, our partners in Europe and non-governmental organisations such as the British Red Cross and Oxfam. Whether it be the horn of Africa, refugees in Afghanistan or displaced people from Azerbaijan, the ODA is there providing a continuous flow of emergency aid to help the victims of many emergencies.

Nor does ODA help stop at emergency aid, vital though that is. It is, for example, running a programme to restore basic electricity supplies to central Bosnia; ODA engineers are repairing power stations and mending supply lines to provide local communities with electricity. Road engineers maintaining life—saving convoy routes, radio operators, fitters, telecommunications experts and logisticians, all paid for by British aid, are working with the UN throughout Bosnia and Croatia. That is work of which we can all be proud.

During the past four months, operations in Rwanda and Bosnia have been undertaken by the UN and a wide range of British NGOs using bilateral ODA funds now totalling respectively £33 million and £94 million. Last week we announced a further £2 million to promote the recovery of Rwanda. Including our share of EC aid, we have spent more than £62 million on the Rwandan crisis since last April. Long—term programmes also continue in northern Iraq, Angola, Mozambique and the horn of Africa.

Sadly, the Opposition have used today's debate to recycle the canard that our aid is in some way linked to arms sales. That is nonsense: there is no link between our aid programme and defence sales, and there never has been. It is absurd to suggest that our aid flows are in any way determined by prospects of such sales. All the 10 highest aid recipients are low—income countries, nine of them in Africa and Asia. A recent OECD report recognises that our aid focuses on poorer countries, and acknowledges its quality.

"The United Kingdom",

says the OECD,

"has a highly concessional business—like bilateral programme largely directed towards the poorest developing countries. Its role as a major donor has been particularly important in several geographical areas, notably Sub—Saharan Africa and Asia, and in key sectors such as education, agricultural research, health and population and private enterprise. The United Kingdom has many prominent institutions in the development field and an enormous amount of expertise".

That is the reality of the UK aid programme—aid that works to reduce poverty world wide, promoting sustainable and lasting development. It has helped, and continues to help, to change the world for the better.

Fifteen years ago there was bitter war in Zimbabwe; equally unresolved was the struggle for Namibia's independence, while civil wars scarred Mozambique and Angola and, of course, South Africa lived under the shadow of apartheid. Now only Angola's future remains in doubt, and there too an end to the conflict seems in sight. In all those countries, and in some 150 developing countries around the world, UK aid has been and continues to be a catalyst for change for the better. There is nothing inevitable about countries' having to be poor, and every reason to believe that it is possible for us—and others—to make a positive contribution to change. The Economist recently forecast that by the year 2020 what are now called developing countries will account for two thirds of world output and that as many as nine of the 15 biggest economies at that time will be from today's third world.

Whether it is helping to improve the distribution of bread in Moscow, supporting sustainable agriculture in Bangladesh, helping to fight malaria in Africa or the countless other programmes and projects supported and funded by the ODA, we are determined to maintain a substantial and effective aid programme to help to reduce poverty worldwide. It is work of which we can all be proud.

I am pleased to share this moment of history with my hon. Friend the Minister. It is perhaps appropriate that you should be in the Chair, Madam Deputy Speaker, because you are a former history teacher. It is also a pleasure to follow the debate initiated by the hon. Member for Leicester, South (Mr. Marshall). When I was elected to this place I feared that I would get his mess bills and that he would get all my dinner invitations. The hon. Gentleman has obviously gone for his coffee break. I wonder what the odds are of two Members by the name of J. Marshall initiating these first two historic debates?

This is not the first time that I have shared a moment of history with the Minister because we were both elected to the European Parliament in 1979. However, the greatest moment of history that he and I shared was on 19 August 1953, when on our respective birthdays Mr. Dennis Compton swept England to victory in the fifth test match and we regained the Ashes. I have one advantage over the Minister because not only was I at the match to see Mr. Dennis Compton do that, but he was born in my constituency; and a week or two ago I took him back to see his old home and his old school.

I pay tribute to the noble Lord Mackay, the Lord Chancellor. The dream of every American is to move from the log cabin to the White House. Lord Mackay made just as distinguished a journey, from a railwayman's cottage in Sutherland to the job of a Law Officer and then Lord Chancellor. There are two kinds of Law Officers—distinguished politicians who happen to be lawyers and distinguished lawyers who happen to be supporters of a political party. Lord Mackay is very much a distinguished lawyer.

It was said in Scotland that, no matter which party had won the 1979 election, it would have asked him to be Lord Advocate. It is a tribute to him as an emigré Scot that when he was appointed Lord Chancellor of England in 1987 the appointment was greeted with a mere murmur of approval. One wonders how Scotland would have reacted if an Englishman had been appointed Lord Advocate in 1988. I suspect that there would not have been a murmur of approval: the Scottish advocates would have had something to say.

I join in the hon. Gentleman's fulsome tribute to Lord Mackay, who is one of my constituents. However, to put the matter in another contemporary context, although he may well have been appointed by a Labour or a Conservative Government in 1979, his subsequent conversion seems to have been complete, because at the last two general elections he spoke against me at Conservative campaign meetings in the constituency.

My only regret is that the noble Lord cannot vote in the constituency, other than in European elections when I am sure that he carries out his duty and votes for the right party.

To vote the right way is to vote Labour.

The hon. Gentleman is misguided if he thinks that the Labour party has any chance in that Euro constituency. We know that he is an opponent—

Order. What has this to do with legal aid?

You might ask the hon. Gentleman who took me down that by road with his sedentary intervention, Madam Deputy Speaker.

It is appropriate that the task of reforming the legal aid system should fall to Lord Mackay who has a fine legal mind, the analytical mind of a mathematician, and who has the sense of compassion to be found in those with a deep religious background.

The legal aid system was designed on the simple premise that no one should be denied justice because he is poor. That is an excellent and noble sentiment but, unfortunately, the system no longer achieves its basic objective despite being the most generous system of legal aid in the western world. Its cost has risen dramatically. In 1979–80, the system cost £99 million. In 1984–85, the cost was £263.1 million and by 1993–94, it had risen to £1,210 million. In the current financial year, it is estimated that it will cost £1,333 million.

Since 1979–80, the cost of legal aid has more than quadrupled in real terms and has gone up by 1,248 per cent. in cash terms. No wonder the noble Lord Mackay said:

"We must look to new solutions. I am open to new ideas on how we can meet our objectives more efficiently, more effectively and more cheaply."

Of course some people will cavil about the phrase "more cheaply" but I remind the House of two points. First, if we can produce a cheaper system it will be to the benefit of all litigants, not only to the benefit of the legal aid fund. Secondly, the resources devoted to legal aid could be better employed elsewhere. It is a chilling fact that the amount devoted to such aid would be sufficient to provide nursery school places for all three and four-year-olds.

Does my hon. Friend agree that one of the most important reforms that the Lord Chancellor has said he will carry into effect is the withdrawal of legal aid which has scandalously been made available to extremely wealthy people? The only reason for those overseas nationals litigating in British courts is that our courts are convenient forums. Those people have vast assets and clearly should not qualify for British legal aid to the detriment of the British taxpayer. It is right that our noble Friend intends to correct that abuse.

My hon. Friend anticipates my speech. Like him, I have read the consultation document "Legal Aid for the Apparently Wealthy". It is a valuable document, to which I shall turn later in the debate.

Does my hon. Friend agree that legal aid for the apparently wealthy is a mere pinprick compared with the amount of legal aid that has been granted? Was he present in the 1980s and 1990s when we enacted one piece of legislation after another, doubling the number of offences, the number of courts and the amount of legal aid that has to be granted as a result? Does he agree that a large part of the legal aid budget is our fault? We are responsible for it.

I am afraid that I must disagree with my hon. Friend. When one examines the growth of the fund—[Interruption.] I wonder how those who are following our proceedings at this historic moment regard the attitude of Opposition Front-Bench speakers who make sedentary and unintelligible interruptions.

The biggest item of growth in the legal aid fund is civil legal aid rather than criminal legal aid, so I must disagree with my hon. Friend. He may regard it as a mere pinprick that Mr. Ernest Saunders received £1.3 million in legal aid and that the Levitt case cost the taxpayer £2 million, but when people see Mr. Levitt quaffing champagne at Tottenham Hotspur and living in a home worth £750,000, they regard it not as a pinprick but as an obscenity. They believe that those sums are the resources of the taxpayer and that they could be used more efficiently and more sensibly elsewhere.

I agree with my hon. Friend about that.

I thank my hon. Friend for his agreement. I think that, for a Wednesday morning, the House is indulging in far too many sedentary interruptions and I shall now proceed with my speech.

The National Consumer Council has suggested various ways in which legal aid could be dealt with more cheaply. It suggests that greater use could be made of binding arbitration. That would be especially useful in matrimonial cases, which have been one of the causes of the great mushrooming in legal aid. The council also suggests the development of no win, no fee, legal services. Our noble Friend Lord Mackay suggested that idea during the recent reform of the legal profession.

The council suggests that no-fault compensation under the Road Traffic Acts would be a means of reducing the legal aid burden, and that we should promote low-cost legal services. As a consumer, one would like legal services to become less expensive not only for the legal aid fund but for the many other consumers of legal services.

My hon. Friend mentioned the explosion in matrimonial legal aid. I practised at the Bar for a number of years before I came to this place, and I did a lot of work as a family law barrister in particular. I noticed that there was large legal aid expenditure for people who would frequently come to court for domestic violence injunctions.

Although it is proper that legal aid should be available in such cases, the problem often was that the battered wife would obtain legal aid to bring a case, to obtain an injunction, perfectly properly, and to protect herself, but she would then allow the man responsible for the violence back into her house. The relationship would resume. There would then be another violent incident. I see that the hon. Member for Swansea, East (Mr. Anderson) nodding. He is familiar with the problem. The woman would return to court and there would be further legal aid expenditure.

Does my hon. Friend agree that it is important for legal aid to be limited to, at the most, no more than two applications to court, because so often, legal aid is wasted by repeated applications by the same parties in the same court?

Order. Before the hon. Member for Hendon, South (Mr. Marshall) resumes his speech, may I point out, as I have already said once this morning, that interventions should be brief.

There is obviously merit in what my hon. Friend the Member for Blackpool, South (Mr. Hawkins) says.

The National Consumer Council suggested that there might be a development of the salaried sector. It pointed out that in Holland, 15 per cent. of legal aid is through the salaried sector rather than through private practice solicitors.

In the legal aid system, we must consider the need to make greater checks on applications. In a written answer on 24 October 1994, my hon. Friend the Parliamentary Secretary, Lord Chancellor's Department told me that, in 1993–94, there were 413,728 claims for civil legal aid and 606,041 applications for criminal legal aid. In that financial year, the legal aid assessment office referred 15 cases for alleged fraudulent claims.

We are being asked to believe that, of the 606,041 rather benign individuals who made applications for criminal legal aid, only 15 would dare to give misleading, inaccurate information to the legal aid fund. I do not believe that, out of 1 million applicants, only 15 might have told the odd fib or two. It beggars belief.

A written answer given on 26 October 1994 by my hon. Friend the Parliamentary Secretary shows that there has been a growth in the number of high-cost trials. In 1990–91, there were only 94 legal aid cases costing the taxpayer more than £100,000. By 1993–94, there were 226 such cases. In the first half of the current financial year, there were 153 cases. Those include some of the cases that have caused the greatest concern to the taxpayer.

The fact that some cases can cost more than £100,000, and that some other cases may cost only £1,000 or £2,000, underlines the absurdity of a standard assessment of means under the legal aid system. Although one individual might be able to afford a case costing him £5,000, he might find it much more difficult to produce the readies for a case costing him £100,000.

Despite, or perhaps because of, the cost of the legal aid system, it is expensive, capricious and unfair to individuals. That is why the Lord Chancellor's attempts to reform the system have been widely welcomed. Nothing has received a greater welcome than the consultative document "Legal Aid for the Apparently Wealthy".

I referred earlier to the case of Mr. Roger Levitt, who enjoys a life style that was the envy of many people. He has a home in St. John's Wood. He quaffs champagne. [Interruption.] He is still very well represented in St John's Wood by my right hon. Friend the Member for Westminster, North (Sir J. Wheeler). Mr. Levitt's life style is an insult to the investors who lost all their money in his organisation.

The hon. Gentleman was only too anxious to share with us his judgment as to how the noble Lord Mackay voted at the previous election. Would he like to hazard a guess as to how Mr. Levitt voted?

I made it clear that Lord Mackay did not vote at the previous election because, as a member of the House of Lords, he could not have done so.

I caution the hon. Gentleman about following the path set out by the hon. Member for Brent, South (Mr. Boateng).

I was just going to say that I would not speculate as to how someone who did not live in my constituency voted, because I would not have any access to canvass returns that could give me any accurate information on the matter.

It is equally offensive to taxpayers and citizens when they see Mr. Ernest Saunders skiing with his wife in Switzerland and hopping across the Atlantic on Concorde, no doubt ready to patent the cause that managed to cure him of Alzheimer's disease. He enjoys a lifestyle that is far superior to that of the vast majority of taxpayers and hon. Members, yet he received £1.3 million in legal aid.

There is the case of Mr. Gordon Foxley, who is guilty of massive corruption at the Ministry of Defence. He netted a tidy sum, has a house worth £500,000 and a fleet of cars. He has managed to sting the taxpayer twice, first as a civil servant and then as a defendant in a case. We also have the case of Mr. Hashim, who received £4 million in legal aid, despite being a multi-millionaire.

Legal aid was designed to help the indigent defend themselves. Instead, it is being misused by a number of asset-rich individuals, who have been able to cover up the source of their luxurious life style and to sponge off the taxpayer. I am sure that all hon. Members would like to congratulate our noble Friend Lord Mackay on his determination to remove that scandal.

Lord Mackay's consultation paper contained five questions. First, should there be a limit to the amount of equity ignored for means-testing purposes and should that limit be set at £100,000 for private houses? Secondly, should there be a ceiling on the amount that can be ignored as the subject of dispute and, if so, would a figure of £100,000 be appropriate? Thirdly, should the legal aid rules be changed to allow the existence of a Mareva injunction to be ignored? Fourthly, should more be done to develop the concept of legal aid as a loan when the applicant is unsuccessful in his litigation? Finally, should there be an affluent life style provision in the civil legal aid scheme?

Most people believe that there should be a limit on the amount of equity to be ignored when it involves a private home. Most ordinary taxpayers do not enjoy an equity of £100,000 in their homes, so why should they pay taxes to finance the legal costs of those who live in very much better homes? I also believe that there should be a similar disregard in respect of the assets which are the subject of debate. I suppose that a Mareva injunction would be known as the Hashim clause. It is applied only when someone leads a wealthy life style and has substantial assets. It gives great offence to people that Mr. Jawad Hashim should have receive £4 million in legal aid when he was a multi-millionaire, had seven homes and expensive cars, and managed to employ servants.

Does my hon. Friend agree that it is not only the very rich who should be considered in the review but the poor? If the poor receive legal aid as a matter of right, it could distort the outcome of a case for the defendant.

With that very short question, my hon. Friend has curtailed my speech by about four minutes, which will no doubt please the House.

I agree that, in civil legal aid, which is the most expensive aspect of legal aid at the moment, the existence of a legal aid certificate is the strongest weapon that a litigant can have because those against whom he is litigating know that, whether they win or lose the argument, they will pay the costs.

The principle whereby, when a case is lost, the legal fund pays nothing towards the costs of the person being sued needs to be re-examined. That is unfair and leads to delays. I am told that the best way to win a civil case is to have a legal aid certificate and that the second-best way of winning is to have a good argument. We have read recently that Mr. Winston Silcott is to receive £100,000 of legal aid to sue the Metropolitan police. Many people, including the Metropolitan police, regard that as thoroughly offensive.

The Lord Chancellor's fourth question was whether legal aid should sometimes be regarded as a loan. Mr. Ernest Saunders told the press that he is shortly to receive a £70,000 pension from Guinness. He also receives substantial fees for lecturing and giving marketing advice but chooses not to pay anything towards his legal aid costs which, I remind the House, were £1,342,465—not a penny more, not a penny less. In such cases, the unsuccessful criminal who then comes into money should be expected to pay something towards his past legal aid fees.

I deal now with the question of an affluent life style and what could in future be called the Roger Levitt clause in legal aid. Everyone believes that those who enjoy an affluent life style should not receive legal aid.

Does not my hon. Friend believe that someone acquitted on appeal should receive costs, or does he believe that people who are wrongly convicted should always pay into the legal aid fund and always lose out? I am thinking about Roger Levitt in particular.

It is up to the courts to decide whether someone who has been acquitted should receive costs. It is not right to say that everyone who is acquitted should receive costs, because there might have been good reason for the prosecution. It may well be that the old Scottish verdict of "not proven" should be introduced in some cases. Were that to happen, the person involved might not receive costs. It would be wrong to say automatically that people who are prosecuted should not pay anything towards their defence.

rose—

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I think that I should give way first to my hon. Friend the Minister.

So do I.

I am grateful to my hon. Friends the Members for Hendon, South (Mr. Marshall) and for South Hams (Mr. Steen) for their courtesy. In his admirable speech, my hon. Friend the Member for Hendon, South has already dealt with the five questions set out on page 35 of the document entitled "Legal Aid for the Apparently Wealthy". Would he be good enough to consider—not necessarily this morning but when he has had time to reflect further—the many other questions contained elsewhere in the document, because I would value his opinion on them, too?

If I tried to answer every question in the document, I should have to take up the whole of the debate. I do not know whether my hon. Friend the Minister was intervening because he thought that he might not have the opportunity to do so later.

My hon. Friend .the Member for Hendon, South (Mr. Marshall) has touched on legal aid in criminal cases. Does he agree that, too often, legal aid is offered as of right to people charged with criminal offences? Does he agree that that should not be so and that the most stringent means test should be applied to those who have been charged with such offences, as happens with civil matters? Does he further agree that too much money is being spent on legal aid and that the problem needs to be dealt with?

I thought that I dealt with the latter point at the beginning of my speech when I said that there had been a huge increase in the legal aid bill from under £100 million in 1979–80 to £1.3 billion in the current financial year. On my hon. Friend's first point, he is right to say that legal aid should not be given as a right. The merit of the case should be examined.

Having spoken to various lawyers over the past few weeks, I have learnt that many believe that legal aid is given in cases which are not as legally meritorious as others in which it is not given. I could cite a number of such cases involving people who come to my constituency surgery—their adversary has been awarded legal aid but they feel that the case did not merit it. I shall cite only two examples because this issue is taking my speech out of sequence, although that will reduce its length.

One constituent told me that he had been given planning permission by Barnet council to build a garage. He had bought the bricks and wood but then a neighbour said that such a garage would interfere with his light. The neighbour approached the legal aid fund and received backing. This created inequality, because the person who had received planning permission could not get legal aid and could not afford to fight his case. The legal aid fund, in effect, determined the outcome by backing one individual when the other could not afford to fight the case.

On another occasion, representatives of a Hindu temple came to see me. They had expelled someone who had broken an agreement. Had he apologised, they would have taken him back. However, he decided not to apologise but to go to court with help from the legal aid fund. It was not a meritorious case—an apology, which would have cost nothing but the loss of face, was not offered so expensive legal action was taken with only one side benefiting from legal aid. It is unfair, and a waste of taxpayers' money that could have been used elsewhere.

There are so many people in the category that my hon. Friend has just mentioned that they now have their own acronym—MINELA: modest income, not eligible for legal aid. Those people are now in the weakest position in the whole legal service.

My hon. Friend is quite right. On one occasion, I was described by one of the chaps who compiles the parliamentary profiles, Mr. Andrew Roth, as a man of patience. I hope that I have demonstrated that patience by the number of times that I have given way this morning.

The Lord Chancellor said in his document that an affluent life style was difficult to define. It may be difficult to define, but we can certainly recognise it in the life style of Mr. Hashim with his seven houses, in Mr. Foxley with his £500,000 mansion, in Mr. Levitt with his £750,000 home, and in Mr. Kenneth Sinar—with his yacht Enendine, which had six berths, three cabins and four occasional berths—who lived in millionaires' row in Hove.

Those life styles are the envy of the ordinary citizen, who cannot afford luxury yachts, champagne in boxes at White Hart lane or a fleet of motor cars. It is quite wrong that the ordinary citizen, who cannot afford that life style, should have to pay taxes so that someone else can continue to afford it. Our noble Friend Lord Mackay is to be congratulated on seeking to release those resources so that they can be used to help those in real need. I shall not speak at great length about civil legal aid because I dealt, in various answers to my hon. Friend the Member for South Hams (Mr. Steen), with the issues that concern me, concern him and concern the House.

The objective of legal aid, when it was set up in 1948, was that no one should be denied justice because of their income. That is no longer true because those who can afford justice in the courts today are the very wealthy and those who are legally aided. A huge swathe of middle England cannot afford justice.

And middle Scotland.

And middle Scotland.

That is due not to a defect in the legal aid system but to the cost of the legal system in general. That is why I welcome the appointment of Lord Woolf, whom the Government have asked to try to reduce the cost of the legal system. Lord Woolf has to look at three points: the costs involved in legal action, the delays involved in legal action, because justice delayed is justice denied, and whether some cases could be removed from the legal system altogether.

There is one more point to mention, if my hon. Friend would allow me. We should also consider the fees charged by lawyers. If the fees that lawyers charge were pegged, the legal aid fund would not have to pay out so much money. It is similar with doctors, who charge whatever they like, knowing that private insurance will pay.

.I see that I am equidistant between my hon. and learned Friend the Member for Leicestershire, North-West (Mr. Ashby) and my hon. Friend the Member for South Hams. One is obviously a consumer and the other a provider of legal services. I shall not dare to decide who gets the better deal.

On a point of order, Madam Deputy Speaker. May I acquaint the House with the fact that I am learned, as well as our hon. Friend the Member for Leicestershire, North-West (Mr. Ashby)?

I regard my hon. Friend the Member for South Hams as learned in many matters.

I also welcome the fact that Lord Justice Taylor is reported in the press this morning as trying to make lawyers less wordy. He says that cases would be determined more quickly and less expensively for all litigants and the legal aid fund if that were so.

Legal aid was designed to ensure that no one was denied justice because of their income. That was an excellent concept in 1948. It was an inexpensive concept in 1979, but today it is a very expensive concept, which is being abused by some individuals. However, the misuse by a minority is not an excuse for destroying the system, but an argument for reforming the system. That is why I welcome the consultative document and the Lord Chancellor's positive and penetrative proposals.

The original objective of legal aid has been destroyed because many people today are denied justice. As I said earlier, only the wealthy and the legally aided can afford to enjoy justice in our courts. That is why I welcome the determination of the Lord Chancellor to reduce the cost of our legal services, why I welcome the appointment of Lord Woolf and why I welcome the reported comments of Lord Justice Taylors.

I am grateful to have an opportunity to speak in a Wednesday morning debate in the House. I have often spoken elsewhere at such a time, but I never had the pleasure of speaking here. I shall begin by congratulating my hon. Friend the Member for Hendon, South (Mr. Marshall) on an extremely lucid description of his concerns, with which I identify. There are, of course, many people who would see things differently. I have spoken to those outside this House who have complained that far from it being the case that the amount being spent on legal aid is generous, a great deal more should be spent. I add that those people—normally—are practising in law and perhaps, therefore, are personally involved.

In answer to such people, a strong case could be made for the success of legal aid based on the amount of funding that has been made available. If one considers the latest available figures—I obtained them from the House of Commons Library yesterday—it is immediately apparent that, for example, civil legal aid in general has increased by a huge percentage; about 1,000 per cent. since 1979. The total increase, comparing last year with 1979, is in the order of 400 per cent. after adjusting for inflation. Without that adjustment, that 400 per cent. figure becomes 1,122 per cent.

The increases are apparent not only over the period between 1979 and 1993, but over the most recent years. My hon. Friend the Member for Hendon, South quoted more figures which support that charge. In addition, the number of bills paid for legal aid show a huge increase. Civil legal aid bills increased from 104,804 in 1979–80 to 359,188 in 1993–94. For magistrates, the number of bills paid for criminal cases rose from just over 243,000 to 432,000. All those figures show that there has been a massive increase in public funding for legal aid.

I said that those figures could be used as an argument for the success of legal aid over that period, but I would not take that view. I would use those figures to illustrate that something has gone seriously wrong. There has been an excessive increase in the funding of legal aid and it should be curtailed. I do not in any sense question that it is true that many individuals have been helped over that period, and rightly so, but to concede that there should be continued increases in legal aid is effectively to concede an argument in favour of an entirely socialised legal system; it would be to say that one should increase funding of the system by a ratchet effect until everybody effectively had the right to claim some money if they wished to take legal action. I would totally oppose that.

I agree with my hon. Friend the Member for South Hams (Mr. Steen) that legal aid, in itself, is a distortion of the system and that, by giving grants to people to litigate, we are giving them a potential advantage over others. I, too, have had constituency cases which clearly demonstrate that. People were persuaded to create litigation because they knew that there would be no possible loss to themselves as the funding would be provided by the state. Others have faced either serious delays or considerable distortions to their legal cases because of the intervention of the legal aid fund on behalf of the other party. Some of those cases have involved people who, earlier in their lives, could very well have afforded to fund their own legal action. I shall return to that point later.

Clearly it is fundamentally wrong for the taxpayer to be expected to write a blank cheque to fund unlimited private action, and especially to subsidise people with a wealthy lifestyle. There is ample evidence that that happens, and although I do not want to go over again the ground so ably covered by my hon. Friend the Member for Hendon, South, I shall refer to two cases that my hon. Friend mentioned.

Dr. Jawad Hashim received £4 million in legal aid—an outrageous payment. A former president of the Arab Monetary Fund, he was being sued for £33 million, which he had allegedly siphoned into private Swiss bank accounts, and he owned six luxury homes around the world. Eventually he was ordered to pay £132 million in compensation. There was no question, at any stage, of that man being poor or even remotely understanding what poverty is, yet he could claim from the British legal aid fund. That is so unacceptable that action must be taken as a matter of urgency to prevent any recurrence of such a case.

My hon. Friend raises an interesting point. Has he considered whether legal aid will be available to all European Union citizens? Will any Frenchman or Dutchman who comes here be entitled to legal aid, too, and if so, will inquiries be made about the circumstances of such people in their own countries? Might that not be another way in which Europeans can take money from the British taxpayer?

That is an important consideration. In his consultation document "Legal Aid for the Apparently Wealthy", the Lord Chancellor asked to what extent nationality should be taken into account in deciding whether to grant legal aid. That is an important topic to examine, and there is a strong argument that the taxpayers of this country should not be expected to fund the legal bills of those who are not British nationals yet who might for one reason or another appear in the British courts. Such people may have chosen to appear there, and be taking action themselves. In a number of such cases—perhaps in all of them—it is no longer suitable, right or fair that people should receive support from the taxpayer.

The other case that I wish to mention is that of Mr. Roger Levitt—another glaring example of misuse of the legal aid fund. Mr. Levitt received £3.7 million to fight fraud charges, yet continued to live what was clearly a luxurious life style. I accept that those are unusual cases—they are by no means run-of-the-mill uses of the legal aid fund, and thank goodness for that—but that does not make them any more justifiable, nor reduce the need to correct the abuse.

In the light of such cases and of other information, the Lord Chancellor last month produced a Green Paper, in which he asked some excellent questions and made some excellent suggestions. I draw the attention of the House especially to what he says about the affluent life style. That may be a difficult concept to define, but it is an important one because it has to do with equity and credibility, and with another more important factor that we are here to act upon—the views of ordinary members of the public, who feel outraged when they see their taxes siphoned off to support people who live a special life style, out of the reach of their world.

Not only should current affluent life style be taken into account, but some means should be found to examine past affluent lifestyle. I know that that is a difficult subject, but there is a considerable difference between someone who has always had a limited life style and income, and someone else who has been financially successful throughout his life and has amassed a large fortune and lived in great style, probably operating in the business world, but who for one reason or another has now fallen on financial hard times. We all know of people who, according to their bank balance, have fallen on hard times, but who still have access to funds both at present and, more particularly, in the future—especially if they have the skills required to deal in the world of finance and business.

If such people apply to the legal aid fund, it should be asked whether it is reasonable to expect them to have made plans beforehand to protect themselves against the cost of future legal action. I am thinking of insurance, or perhaps organising of their finances, especially if they were operating in the world of business, to take account of possible future legal action. Such people may have worked in a business sector in which legal action was a common phenomenon, and a reasonable business man planning his future carefully in the business world should have put aside funds for possible litigation.

It is also relevant to consider whether the subject matter of a dispute should be taken into account, especially where capital is at stake in the legal action. At present that capital is excluded from the formula, but should it be taken into account? I feel strongly that it should, and I also support the idea of a cap to limit the allowable value of a property and size of a mortgage.

There is much more to be said on the subject, but this is a brief debate, so I do not want to delay the House further. I finish simply by drawing the attention of the House to the many possible alternative ways to help those who need to take legal action that obviate the need for the taxpayer to provide a subsidy through the legal aid fund. Such methods could help those who are, in the jargon, "apparently wealthy", as well as those in the middle income bracket who would not at present be entitled to legal aid, and those who, legitimately and understandably, are now entitled.

One such method is the no win, no fee, arrangement, which represents a positive step forward in our legal history and gives us hope for the future. It would enable individuals to sue and to take other action without any risk to them, yet with the possibility of gaining compensation or other redress at no cost to the taxpayer.

I strongly support the drive to achieve a cheaper legal system for the consumer, via the courts or via alternative means. I also support an extension of standard fees, which could help towards that objective, and the encouragement of other administrative processes—there are now many of those—as an alternative to legal action. Legal action should be a weapon of last resort, not of first resort, for the ordinary citizen. There should be, and are, other means by which redress can sensibly be achieved.

I should like strong action to be taken to make the appeals system cheaper. Many parts of that system can be very expensive, and we must try to ease the passage of those with a genuine cause for grievance against a lower court, without involving huge costs to them or to the taxpayer.

We need stricter targeting, further and better checks on applications, and the elimination of abuse and fraud, whether that be abuse that is permissible at present under some of the strange twists in the legislation, or fraud that is not permissible but is not being cracked down upon sufficiently. Specifically, I urge the development of alternative ways of obtaining redress. Those developments constitute the answer that should enable us not only to restrain the growth in the cost of legal aid but to reduce that cost. That, and not the reverse, is what I would regard as a success.

I too am glad to be taking part in the first of our Wednesday morning debates. In the great world outside it may be commented upon that our Chamber is a little sparsely attended, but we are here as Back Benchers to debate subjects of close personal interest to us. I therefore congratulate my hon. Friend the Member for Hendon, South (Mr. Marshall) for securing us a debate on legal aid today.

The workings of legal aid services, as they are at present, remain a mystery to the general public unless and until they find that they are forced to use them. The general perception—at least of constituents who visit me in my advice surgeries—is that the service has been underfunded and cut. Perhaps that is because people remember the publicity that was given in 1993 to the tightening of the eligibility conditions. That produced an outcry at the time, but it is worth reflecting on the reality of the costings today, as my hon. Friends said.

The legal aid scheme cost £685 million in 1990–91, as the Lord Chancellor noted recently, and this year the cost is increasing to £1,300 million, even with tightening of eligibility conditions—a doubling of expenditure in three financial years. That, by any standards, raises questions about good use of public money. We must ask ourselves how cost-effective that service is. If the general public knew the rate of escalating cost and what they receive in return, they would be much angrier and more stirred up about the subject than they are. What is more, unless we do something, the trend is likely to continue upward.

I was grateful for the chance to read the keynote speech about the future of legal aid given by the Lord Chancellor on Wednesday 11 January 1994, at a seminar organised by the Social Market Foundation. That was a fundamental think-piece and discussion of the way that we might consider trying to change the legal aid system.

The general public may believe that the number of people helped by legal aid is declining, but under the scheme it has actually increased from 3.5 million to 4.5 million. Nevertheless, it is not uncommon for Members of Parliament such as myself to be visited by constituents who have tried to take up a legal grievance—especially through the civil courts—and who find that they are unable to do so because they fall, sometimes just an inch, outside the eligibility criteria.

Those people become extremely cross when they hear about the examples that were quoted this morning. They do not understand how people of such great wealth can obtain access to the legal aid system with such enormous sums yet, when they themselves are fighting what to them are important cases but may appear to other people to be small matters, they are unable to obtain legal aid. All that adds up to a general opinion that the legal aid system is not serving the public as well as it should.

That forces one to ask how a service based on such fast-growing expenditure can be so poorly regarded. We should probably seek the answers in the inflexibility of the present court-based system, at least as it applies to civil cases, and the remorseless increase of the cost of each individual case, leading to a commonly held opinion that the cost of civil justice is climbing beyond the reach of individual people.

Has my hon. Friend considered that, in respect of civil justice, the responsibility for the increase lies fairly and squarely at the Lord Chancellor's door, and at the door of the Lord Chief Justice, who have introduced, as recently this year, rules that have increased the cost of court proceedings enormously? I have suffered. I have had to pay up as a result of stupid rules that have been inserted, requiring replies that previously were never necessary, which have increased the costs of cases enormously. The Lord Chancellor and the Lord Chief Justice are responsible for the increase themselves.

My hon. Friend makes a valuable argument, because there are two sides to the equation— the increasing costs of legal aid and the cost of the court system. The latter subject alone would be worthy of a debate on another occasion, but unfortunately I do not have the time to develop that theme this morning.

However, for all the reasons that I have given, I warmly welcome the Lord Chancellor's decision to publish his consultation paper, and also to ask Lord Woolf to carry out a review of the procedures of the civil courts. I hope that Lord Woolf will bear in mind some of the arguments that were made by my hon. Friend the Member for Hendon, South. In addition, some interesting ideas for fundamental reform of the legal aid system were proposed in the speech that I mentioned.

The legal aid system as we know it today emerged from the Legal Aid and Advice Act 1949, which set up the civil legal aid scheme that is very much the basis for that which exists today. It has been rather like a train that starts with two carriages, to which carriage after carriage has been added, so that it becomes progressively slower.

Assistance was introduced under the green form scheme, which was introduced in the 1970s, and the duty solicitor schemes of the 1980s. However, the essential approach is on a case-by-case basis.

The Lord Chancellor rightly asked the question—I think a good one—whether there are more cost-effective ways of achieving results, at least in the early stages of civil cases, so that they do not necessarily have to come to court. Simplification is one example.

I find the six objectives that the speech spells out especially interesting. There is no time to discuss all of them this morning. There is a need to recognise and incorporate the contributions that can be made by legal agencies and advice services, such as local law centres. Citizens advice bureaux do valuable work, but many are short of funds. They could greatly expand their work if the opportunity came to them through the legal aid system.

In selecting that specific proposal from the many that the Lord Chancellor has suggested for discussion, I urge my hon. Friend the Minister, when he replies—

Is not the hon. Gentleman aware of some contradiction between the wish to expand the work provided to the public by citizens advice bureaux and the financial difficulties of those bureaux throughout the country as a result of the pressures on local government?

I think that that is a different issue. I am discussing the suggestion that we give citizens advice bureaux a new and expanded role, which would need to be separately funded. The other funding issues should be tackled, but there are different ways to tackle them. That is why I shall follow with great interest the pilot project that the Legal Aid Board has established to encourage the delivery of legally aided services by non-solicitor agencies.

The other aspects of the Lord Chancellor's speech that interest me are, first, better targeting of those in greatest need and, secondly, improved quality and efficiency. I know that attempts have been made to achieve that by means of the courts charter, but a case has come to my attention in my constituency, Roxborough v. Poffley, in which there was almost unjustifiable and outrageous delay in the court proceedings—so much so that the judge involved wrote privately to criticise the way that the delay developed.

I have written to the Minister about that case, and he has had the courtesy to reply. However, I find it extraordinary that, after all the work that went into the courts charter, it does not cover listing, because it is considered judicial rather than administrative.

The Lord Chancellor has a chance to put his house in order. The courts provide a service to the public, and that service needs to be more responsive to the public to help cut delays. I should be interested to carry out an analysis of the cases that have been mentioned this morning to find out what proportion of the high costs in those cases was due to delay, whether reasonable or contrived.

We must use the opportunity to find ways to improve the legal aid system, so that it once again gives the taxpayer value for money and makes him feel that it provides a valuable service. That is not the case now, which is why I have given such a warm welcome to the Lord Chancellor's excellent speech earlier this month.

We owe the hon. Member for Hendon, South (Mr. Marshall) a debt of gratitude for enabling us to discuss legal aid and legal services this morning. It is right that the topic—all too often neglected in the Chamber—should find its place on the fist Wednesday morning sitting. For that, we owe the hon. Gentleman a debt of gratitude.

During the debate we have heard a litany—a veritable rogues' gallery has been paraded before us by Conservative Members—of people who have abused the legal aid system. We heard of Mr. Levitt, Mr. Hashim and Mr. Saunders. Strangely, given the litany of rogues, one name was missing: the name of Mr. Asil Nadir. I wonder how that name came to be missed—

I would have mentioned him if I had been called.

I hear from one independent spirit on the Conservative Benches that, had he been given the opportunity, he would have mentioned Mr. Nadir. It is so often the case with Conservative Members that they are just about to mention Mr. Asil Nadir, that well-known contributor—

Order. I must caution the House that, if my recollection is correct, the case is not concluded. It may be in indefinite suspension, but I think that it is still around.

We shall be suitably cautioned, Madam Deputy Speaker, and will not pursue that matter further. Who knows—the legal aid cornucopia involving that individual may yet begin to flow.

But the serious point is that we would be most unwise to fashion a policy on legal aid and legal services based on those particular individuals, their experiences and abuse of the system. We need a more rational and coherent approach. I have listened to the contributions of hon. Members this morning and it may well be that, in fashioning that approach, it is possible to achieve some agreement on the basic principles.

There is one critical principle on which we must all agree if we are to fashion a legal aid system and legal services that are capable of meeting the interests of justice. It is vital that a system of legal aid and legal services for which the taxpayers of this country pay should be able to deliver legal aid, advice and assistance, and where necessary representation, to many more of those taxpayers than is currently the case.

The scandal of legal aid is the way in which, in civil matters, unless someone is in receipt of income support, he can forget public assistance when pursuing a just, reasonable and meritorious claim. It cannot be right that people who work, but are of modest means and contribute to the cost of the service through direct and indirect taxation, should effectively be excluded from access to justice.

I am sorry that both I and the hon. Gentleman—who would, I am sure, like to declare an interest—have been deprived of a fee this morning. The hon. Gentleman will have heard my interventions on the way in which we are responsible for the increase in legal aid. I am sure that he will agree with that in terms of both civil and criminal matters.

Does he also agree that we are having a debate on the increased cost of legal aid without considering one aspect—we have an extremely good form of justice and legal service, which is dirt cheap? It is not an expensive service when compared with those of other countries and what they deliver.

I am afraid that I must beg to differ. What the hon. Gentleman has to say smacks of complacency, which is unacceptable to the Opposition. I do not believe in doing down our system, but we must face the fact that it has become bloated and inadequate in terms of being able to meet the challenges of the end of the 20th century. We need to reform it in quite radical ways if it is to meet the needs of the times and deliver access to justice.

Will the hon. Gentleman give way?

I regret that I am unable to give way again.

The hon. Gentleman has misunderstood.

It is the fate of politicians to be misunderstood from time to time—I fear that that has affected the hon. Member for Leicestershire, North-West (Mr. Ashby) this morning.

We must recognise the importance of reforming the legal aid system in a way that is consistent with, and carried out at the same time as, our reform of the practices and procedures of the law. We must also reform the way in which the professions and their practices and procedures are structured. An element of restrictive practice remains in the organisation of the legal profession which requires reform.

We welcome the work of Lord Justice Woolf, but there is an urgent need to reform the procedures of the civil justice system. We need to minimise delay and unnecessary replication of tasks. We must ensure that the focus is always on moving forward litigation when it is inevitable, but avoiding it when it can be avoided.

Inadequate attention is paid to mediation and alternatives to law, particularly family law, which swallows one third of the civil legal aid budget. That attention needs to be paid not, I hasten to add, as part of a Treasury-inspired cost-cutting exercise—although it is an effective way of reducing costs—but as a way of delivering a better, more cost-efficient and effective service to consumers of legal services. The time has come to put the consumer of legal services first and to recognise that consumers are losing at the moment.

I shall give one example of the way in which the legal aid system is currently failing to meet the needs of those who deserve advice, assistance and representation. Mr. Vincent Oliver came to see me. The Legal Aid board found that he had proper cause for action in a claim for compensation against St. Mary's hospital for an operation in which his voice box was mistakenly removed.

That is a terrible trauma in itself but, worse than that, this man has no savings or disposable capital and he does not enjoy a grand life style—there is nothing to mark him as being anything other than an ordinary bloke. He receives benefits to the sum of £343 per month, and he is being asked to contribute £44.80 towards the cost of his legal aid. He is incapable of paying that sum without considerably reducing what is already a very modest standard of living. That cannot be right.

What about those people who are denied legal aid altogether—those people who have saved a little extra, or pensioners who have worked hard and saved all their lives but are now denied access to legal aid advice and services? That cannot be right;. the system needs urgent attention.

That is why I ask the Minister, in the context of this short debate, to consider how he intends to address the issue of the under-spend in the current legal aid budget. The Minister will be aware of the Lord Chancellor's commitment to reviewing the issue of eligibility for legal aid if there is an underspend in the total legal aid budget. Last year, there was an underspend of some £70 million, and it is predicted that this year the sum will rise to more than £90 million.

We recognise the need to keep a tight control on the budget, but if that is the case we must find a way of utilising some of that money to meet the needs of the many deserving people who are currently legally unrepresented and unassisted. There is scope for using that money effectively and I urge the Minister to give an assurance that the underspend will be used to meet the needs of those deserving people who, because of the changes in legal aid eligibility, are currently denied access to legal services.

By all means, have a debate about the delivery of legal services, but that debate should not be led by what are essentially Treasury considerations rather than the interests of justice. Let us put justice and the consumer first and see how we can best deliver justice to people who are currently denied it.

Until a few moments ago, I thought that the adversarial approach which is always present in litigation had drained out of politics this morning. However, I am reassured that it is business as usual.

I thank my hon. Friend the Member for Hendon, South (Mr. Marshall) for not only securing this historic debate on our first Wednesday morning sitting but deploying his case in an extremely impressive manner, taking many hon. Members on this side of the House with him.

I congratulate my hon. Friend the Member for Somerton and Frome (Mr. Robinson) on his very thoughtful contribution to the debate. I particularly single out his remarks about the citizens advice bureau. I think that it plays a tremendously important and unheralded role, and I take humble pride in the fact that I helped to establish a citizens advice bureau some 22 years ago. I think that that organisation's worth in society is under-regarded.

My hon. Friend the Member for Beckenham (Mr. Merchant) made a very lucid and urgent speech, with periodic interventions from my hon. Friends the Members for Blackpool, South (Mr. Hawkins), for South Hams (Mr. Steen) and for Leicestershire, North-West (Mr. Ashby).

Most of what the hon. Member for Brent, South (Mr. Boateng) said was very convincing, and he made a valuable contribution to the debate. I turn to his last point with which he wanted me to deal. Legal aid is demand-led and, as such, it is almost impossible to plan for. However, we have endeavoured to forecast, as best we can, in one of the fastest growing and erratic areas of public expenditure.

What the hon. Gentleman calls an "underspend" is actually 7 per cent. more than we spent last year. I think that Government Members will urge me to be careful when discussing what temporarily appears to be an increase of 7 per cent over last year. I do not wish to get involved in an incautious, over-rapid response to performance over a relatively limited period of time.

In talking about a 7 per cent. increase in expenditure over last year, we should bear in mind that the recent changes in the rules of the High Court have meant an increase in the cost of litigation of about 30 per cent. The rules of the High Court need to be looked at.

The House will not be surprised to learn that by far the highest single component in the increasing cost of legal aid is lawyers' bills. My hon. Friend the Member for Leicestershire, North-West will know how long-winded lawyers can be. We should do everything we can to expedite litigation or find alternatives to it.

I turn now to some other points, not least the consultation paper issued by my noble and learned Friend the Lord Chancellor, which contains a chapter dealing with the subject of legal aid for foreign nationals. The Lord Chancellor and I recognise that this issue raises strong feelings. We would welcome views on whether the Government are correct in their present view that it would not be right to impose nationality restrictions on the availability of criminal or civil legal aid.

On the increasing cost of legal aid, it is useful to say that the number of people being helped is increasing. In 1993–94 therewere 3.5 million legal aid acts of assistance and just over £1.2 billion was spent. By 1997–98, we expect the number of people helped by the scheme to rise to about 4.5 million and the cost of the scheme to rise to more than £1.6 billion. We estimate that approximately half of households are currently eligible for civil legal aid on income grounds.

Does my hon. Friend agree that, as our hon. Friend the Member for Hendon, South said in opening the debate, there is scope for checking more carefully people's eligibility for legal aid? If those who are claiming legal aid fraudulently are weeded out of the system, it will ensure that more funds are available for those in genuine need.

I am not sure that that question needs an answer: it is self-evident that we should take care to check that people qualify for legal aid, not least in a world full of trickery—a point which my hon. Friend the Member for Hendon, South made rather well. He wondered whether the small proportion of people who were ultimately prosecuted represented all those who were putting their best foot forward, or perhaps doing something slightly more dishonest than that.

On the inequality between legally aided and non-legally aided parties, there are circumstances in which a successful non-legally aided defendant may seek costs against the Legal Aid Board or the legally aided opponent. The restrictions on those circumstances may seem harsh in some cases, but they establish a compromise between protecting those who would otherwise suffer financially and protecting public funds.

Legal aid is granted after both means and merits tests in civil cases. The merits test is designed to rule out cases deemed to be frivolous. I am unable to comment on individual cases, but we should not forget that what might appear relatively frivolous to someone who is not directly involved may be a matter of the first importance to the parties immediately concerned. The Legal Aid Board is responsible for deciding on the merits of the case in civil legal aid, and it takes its duties very seriously in that respect.

It may be helpful to the House in response to the points raised by my hon. Friends if I take a little time to describe the proposals on possible changes to legal aid that the Lord Chancellor set out in his speech to the Social Market Foundation on 11 January 1995 to which my hon. Friend the Member for Somerton and Frome referred in his excellent remarks.

The Lord Chancellor is considering a number of possible new initiatives. He has said that they are only the preliminary ideas. We appreciate that there is a lot of work to be done to put flesh on the bones of a reformed legal aid scheme. The Lord Chancellor and I would welcome views on the proposals.

The basis of the legal aid scheme as it exists today is that help should be provided to those falling within the qualifying limits. Up until now, that help has generally been provided in the same way since the inception of the scheme—by the private legal profession, funded on a case-by-case basis.

The legal aid scheme cost £685 million in 1990–91. In the current financial year, the cost will exceed £1.3 billion—an increase of more than 7 per cent. over 1993–94. That represents a rate of increase much faster than inflation. Unfortunately, the rise in the cost of the scheme is not only because of the greater numbers helped: far too much of the rise is attributable to an increase in the cost per case; at the same time, many people who need legal aid are excluded from it.

As has been made clear by the debate today and by previous discussions in the House and elsewhere, although the legal aid scheme is one of the fastest growing Government expenditure programmes, it is also increasingly under attack from a variety of directions. Therefore, the Lord Chancellor and I have concluded that radical change is needed. The hon. Member for Brent, South said as much as well.

The purpose of the Lord Chancellor's proposals is to establish a better, more efficient, more responsive and more flexible legal aid scheme. The overall cost of legal aid must be affordable and controllable. What is needed is a system which forces those who are providing advice and assistance to assess and reassess frequently whether what they are doing is providing value for money both for the client and for the taxpayer.

It is the Lord Chancellor's intention that a future legal aid scheme should operate under a cash limit. That will provide a discipline for the provision of a quality service, and will contain incentives for suppliers constantly to improve the quality of the service. Such a sense of discipline has been sadly lacking up to now.

It is true, as the Lord Chancellor has made clear, that some cases may not be brought under the new scheme that are being brought now. In practice, however, a cash limit is more likely to mean that more people are helped, in more deserving cases, as priority will be set on the basis of need and effectiveness.

The Lord Chancellor has made it clear that most of what he said about his ideas for future of legal aid on 11 January related to the advice and assistance and civil proceedings. In the light of the distinction between civil and criminal legal aid, we shall need to think carefully about how those ideas might apply to criminal legal aid.

We shall, of course, be considering carefully whether to consider the separation of budgets for different areas of legal aid—or ring fencing, as it is called—so that the risk of one area swallowing up another may be avoided.

The Lord Chancellor proposed that the future legal aid scheme should operate by a system of block contracts. The idea would be that the Legal Aid Board should contract for the provision of services with a range of suppliers. Each legal aid area would have a budget for the provision of a full range of publicly funded legal services. Suppliers would be contracted to supply advice, assistance and representation within their competence. Where it was necessary to refer a case on because the original supplier did not have the requisite skills, it would be to suppliers who had made arrangements with the Legal Aid Board to do such work.

The use of block contracting will enable the board to operate within a cash limit and to set priorities. It is a way to bring alternative suppliers into the provision of legal services. As the Lord Chancellor has said, very valuable work is being done by, for example, law centres, citizens advice bureaux and other advice agencies.

It has long been the Lord Chancellor's wish to see them brought into greater use within the legal aid scheme. The opportunity provided by a reformed scheme to build on the Legal Aid Board's non-solicitor agency franchising pilot project, and extend the involvement of advice agencies will be welcomed by us all.

As hon. Members will be aware, the current legal aid scheme is heavily biased towards certain proceedings and court-based solutions. The reform of the scheme should allow the Lord Chancellor to encourage different ways of resolving problems, using not only advice agencies but also mediation and arbitration, where appropriate.

It has been suggested in some quarters that a cash limit will lead to the money running out towards the end of the year. Frankly, that is scaremongering. Whatever contractual arrangements are devised, we shall need to ensure that there are mechanisms to guard against unreasonableness.

The elimination of waste in the system—that is, waste of time in court proceedings or in waiting for court proceedings—is a priority for the Lord Chancellor and myself. Lord Woolf's current review of the procedure of the civil courts, referred to by many hon. Members this morning, will help in that matter, but the problem of legal aid cannot be solved simply by tackling waste in the system.

The Lord Chancellor and I understand the concerns expressed about the current scheme. We intend to establish a system that enables to us set priorities for legal aid more effectively according to need, to weigh the benefits against the costs, to break down the present lawyer-led system in a way which encourages a variety of providers and different ways of doing the work and to encourage early advice and different ways of resolving problems, and thus reduce the need for litigation.

The points raised by hon. Members today will contribute to our thinking, and I thank my hon. Friend the Member for Hendon, South for initiating the debate.

On perhaps a slightly lighter note, in the context of an essentially very serious subject, not least to the many people involved, unwillingly and unenthusiastically perhaps, in appearing before law courts—I have met few litigants who have enjoyed the experience of appearing before a law court-1 dare say that, although there are challenges for advocates in the courts, and that challenge may be enjoyable in a way—from time to time, I have enjoyed it—to be a litigant and to be a party is daunting. To be involved in such proceedings with only limited resources is even more daunting. It is frightening wondering whether one has the means to meet the costs.

The first English statute providing for legal aid dates back to 1495—it did not all begin in the 1940s. In the reign of Henry VII, provision was made for the representation of poor people in courts of law. The only trouble was—here is an echo of the same problem we face today—that Act did not attempt to define a poor person.

Trains have been built at York carriage works for 150 years, and rail engineering underpins the local economy. The York works are not a smokestack industry from the past. Asea Brown Boveri, which owns the works, has invested £50 million in York in the past four or five years in buildings, machinery, technology and training. The York factory is the most modern of its kind in Europe and produces the only trains that meet the full European crash-worthiness certification. Despite that investment and those achievements, however, time is running out for the York works.

In the course of the past year, ABB has shed 900 of its 1,600 work force, and 10 days ago the company chairman said that he had only eight weeks left to secure a further order—and that if he did not succeed the corporate board in Zurich would have to decide to close York because a factory employing 700 people cannot be kept open if there is no work.

Are the Government saying that Britain can afford to throw away an industry and a plant as important as York just because the British Railways Board has in its wisdom decided to defer for two or three years placing an order for badly needed replacement trains? The ABB board in Zurich finds the Government's attitude utterly incomprehensible. That foreign company bought a chunk of the British Rail system and invested £50 million in York and a further £50 million in the Derby carriage works; yet it is being told that that investment must be written off. What kind of advertisement is that for inward investment or for the Government's rail privatisation policies?

York is currently building the first 64 of 600 class 465 carriages promised to commuters on the Kent coast lines. That stock is to be delivered later this year—three months ahead of the agreed date, which says something for the York works. Everyone expected the contract to roll forward to a second tranche. The existing contract has a follow-on clause, which would not have been included in the contract if British Rail, the Department of Transport, the Treasury and the company had not expected a further order to be placed.

The former Minister for Public Transport, the right hon. Member for Kettering (Mr. Freeman), said last year that he expected to receive British Rail's business case for a follow-on order last June and to be able to finalise an agreement with full Treasury and Department of Transport approval by September.

Just two weeks ago, however, everything was thrown into confusion. The British Railways Board announced a delay of four or five years until 1999 in any further orders for Networkers for Kent coast lines. The board said also that it did not intend to trigger the follow-on clause and felt that any future order would have to be subject to Europe-wide competition. If that happened, even if ABB were to win the contract, the York works would have closed before retendering was concluded.

The British Railways Board says that the reason for delaying is that there is no business case for ordering more stock at present, but that is not the view of Richard Fearn, director of South East Trains—the part of British Rail which operates the service. In a letter last December to the hon. Member for Beckenham (Mr. Merchant), who was in his place a moment ago, Mr. Fearn said:

"I am currently working hard with colleagues in the Department of Transport to try to secure a much larger build so that we can fully replace our old trains on Kent Coast over the next two to three years."

The view that there was no business case for further stock was not shared either by the right hon. Member for Kettering last May, when he said at the York Rail Forum:

"There is a prima facie case for Kent coastal rolling stock."

The Central Rail Users Consultative Committee says that the average passenger loading on Kent coast trains in the morning peak is 2.6 per cent. higher than that permitted on safety grounds and that the overloading factor almost doubled in the past year. The Capital Transport Campaign produced figures this morning showing that the overloading factor on some trains is as much as 27 per cent. above the maximum allowed, including both seated and standing passengers.

No one claims that those ancient, overcrowded slum trains are fit for the purpose of carrying Kent coast passengers. They are history on wheels. In reply to a written question published in Hansard today, the Minister for Railways and Roads informed me that 424 out of 792 carriages on the Kent coast line date from 1959. Those carriages have been in continuous service longer than all but three Members of the House. They are clapped out and should be chucked out—I refer of course to the carriages, not to the hon. Members.

New trains would provide a better, cleaner, safer, quicker, more comfortable and more reliable service, and would divert traffic from road to rail. The introduction of new trains built at York on the Chiltern line increased the number of passengers by 40 per cent. immediately after they were introduced. If the Government are serious about shifting traffic from roads on to the railways on environmental grounds, the rolling stock replacement should go ahead.

My hon. Friend made the point that the ABB situation applies to Derby as well as to York. At a time when investment is required, there is investment blight because the Government's privatisation plans mean that planned development cannot occur. My hon. Friend made a powerful point in respect of the provision that should be made for public transport. Derby is very much involved in the debate.

My hon. Friend makes an important point. I am aware that he and others of my hon. Friends representing Derbyshire constituencies have been campaigning hard for orders to ensure a future for the Derby carriage works. The whole country needs an investment plan that will sustain its railway manufacturing base.

New trains for the Kent coast lines would save fuel because their running costs are much lower; they would reduce maintenance costs and they would free space on Kent coast lines which is needed to provide access for Eurostar channel tunnel services until the new link is constructed.

There are also the safety considerations. The Hidden report into the Clapham junction crash stated that all slam-door carriages of 1950s vintage used by British Rail had to be either strengthened or scrapped by 1999: it did not state that they all had to remain in service until 1999, which seems to be the decision that the British Railways Board has taken.

I know that my hon. Friend is aware of early-day motion 404, which has been signed by 48 Members who are sponsored by the engineering union. I happen to be chairman of that union, the Amalgamated Engineering and Electrical Union. We are all concerned about the loss of manufacturing skills. The closure of the works would be a blow to York and to British industry generally. I hope that my hon. Friend will continue the campaign that he has led so magnificently. We must fight to achieve reversal of a policy that is based on privatisation and not on providing what is needed by the country.

I am most grateful for my right hon. Friend's intervention and for the support that I have received from my hon. Friends on the Front and Back Benches. I know that my hon. Friend the Member for Glanford and Scunthorpe (Mr. Morley) has been lobbying hard, and there are suppliers to the York works in his constituency.

Will my hon. Friend give way?

In view of the time, I must say no to my hon. Friend. I thank him, however, for the support that he has given. Indeed, there has been support from hon. Members on both sides of the House. The hon. Member for Ryedale (Mr. Greenway) has supported the campaign. I know that hon. Members representing Kent constituencies have done so as well. There has been support throughout the country. I have received dozens of letters from people expressing concern about the threat to the York works. I have also had support from the EU's new Commissioner with responsibility for transport, who has taken a close interest in what has been happening.

I am not trying to score a party political point. Common sense says that the works should be saved, as does public opinion. Successive Conservative Ministers have said that the full fleet of Kent coast trains would be replaced and the present Minister has spoken to me on many occasions in the past two weeks since British Rail made its unfortunate announcement. Given the commitment of previous Transport Ministers, both to rail manufacturing and to maintaining that base, and to providing replacement carriages for Kent coast passengers, what will the present Minister do to ensure that a follow-on order is placed with the York works before the deadline, which is only eight weeks away? If no order is placed in the next eight weeks, the works will close.

I congratulate the hon. Member for York (Mr. Bayley) on securing this debate at such a crucial time and on the campaign that he has fought, together with my hon. Friend the Member for Ryedale (Mr. Greenway), whom he generously mentioned, to save the York works. I thank the hon. Gentleman for allowing me a few minutes to speak on behalf of the population of Kent and of all Members representing Kent constituencies, who make common cause with him on the campaign to secure an early order so that there can be a continuation of the Networker express construction programme.

I agree with the hon. Gentleman that this is not a party issue. It is common sense that we want to keep the production lines open at York. It is common sense also that we should not be deterred from placing an order for new rolling stock merely because, even by British Rail's admission, there is a time problem of a year or two.

I endorse all that the hon. Gentleman has said about the need for new rolling stock in Kent. In case there is any misunderstanding—there should not be—I emphasise that 16 new four-car units will be delivered for the north Kent service this year. They are coming ahead of schedule. There will be high-profile new trains on the network in the autumn timetable. They are just a start. They will whet the appetite of all Kent commuters, who will want more new trains. The 16 were always seen as just a start.

To be fair, there was not a firm contract arranged for the follow-on order. There was a clear understanding, however, that we were at the beginning of a continuous process to replace the Kent rolling stock. I pay credit to Network SouthEast. In good faith, it has always expected that there would be a follow-on order. It came as a surprise to us, therefore, when we heard that British Rail felt that it could not continue the negotiations.

Kent Members had a meeting with the chief executive of British Rail. It is on record that he said that the door is still open for negotiation, and we would all be shocked if earnest and serious negotiations did not follow to ensure that a way is found of placing the follow-on order for much-needed rolling stock. The existing rolling stock will be time-life expired in the next three to four years. It would be stupid indeed not to place a new order now, merely for the sake of a dispute about perhaps a couple of years, at the end of which the present rolling stock will be even less safe than it is now. It will be clapped out and breaking down.

We also need new rolling stock for jobs in Kent. It is needed as much in Kent as the York works needs to build it. Kent is happy to make common cause. Now it is for British Rail seriously to put together a business case to submit to the Minister. I should be extremely disappointed if my hon. Friend were to say that a good business case put by ABB to British Rail and by British Rail to the Minister was not likely to receive endorsement. I think that it is the will of the House that we should get on with replacement and have first-class rolling stock in Kent and for rail passengers everywhere.

I congratulate the hon. Member for York (Mr. Bayley) on securing a debate at such a civilised hour and on presenting his case in such a civilised and well reasoned way. I pay tribute to his efforts and to those of my hon. Friend the Member for Ryedale (Mr. Greenway) and my right hon. Friend the Member for Selby (Mr. Alison) on behalf of York and those of their constituents who are employed by ABB.

I acknowledge the crucial importance of railway employment in York. I congratulate ABB and its work force on the efficiency improvements that have been achieved at York and at other sites since privatisation, with the benefit of the substantial investment to which the hon. Gentleman referred.

Given the age profile of the rolling stock fleet and the long life span of the stock, orders are cyclical, as was exemplified by the substantial orders—they were still under construction—for Networker trains to replace Kent inner suburban trains. It was inevitable that there would be a downturn in orders following that peak. The long-term replacement need is below the recent rate of new build.

I understand what the Minister says about the cyclical nature of orders, but the long-term investment and planning of companies such as ABB, for which my constituency is a major supplier, means that they find it difficult to switch on and off. It would be much better for rail commuters and manufacturing industry to have long-term orders.

Indeed. I recognise that it is desirable for us to have a vibrant railway manufacturing industry and, if it can be achieved, a less cyclical pattern of investment.

The downturn in commuting into London since the peak of 1989–90 has compounded the problem. In the late 1980s, it seemed that the Network SouthEast fleet would need to be expanded to meet growing demand. Instead, we have experienced a decline related to the recent recession. That has hit British Rail passenger revenue extremely hard. We expect to see some growth as recovery takes hold, but we cannot be certain when rail commuting will return to the peak of 1989.

British Rail's estimates of rolling stock requirements in the 1980s were made in good faith, as were any related comments made by my predecessors, my right hon. Friends the Members for Enfield, Southgate (Mr. Portillo) and for Kettering (Mr. Freeman). With hindsight, it is clear how commercial demand for new trains has changed since the 1980s.

The Government would welcome a further BR leasing deal following the current £150 million contract with ABB for Networker trains, subject to two points. First, there must be a commercial need for new rolling stock and a good business case for it. British Rail cannot scrap sound and serviceable trains prematurely. Those are matters of judgment. I have no intention of going further in commenting on the sound and serviceable nature of trains, because to do so would be inviting hon. Members, particularly my hon. Friends from Kent, to seek to lynch me or have me certified under the Mental Health Act 1983.

Should not British Rail take into account what its passengers think about its carriages, and also the commercial consideration that, if passengers do not think much of its carriages and switch to the coaches which run from Kent to London every day, its revenues will suffer. British Rail should take that into consideration.

My hon. Friend is right. I am sure that one of the features of the privatised railway industry will be a much greater responsiveness to the needs of passengers.

Those must be matters of judgment for British Rail. The Government cannot generate that commercial need or second-guess BR's judgment, although my right hon. and hon. Friends are free to do so.

Secondly, the financial terms offered by the private sector for financing the acquisition of trains must be acceptable as a long-term lease. Transfer of risk is paramount here. A "genuine and substantial" proportion of risk must be taken by the lessor. It is not possible to lay down mechanistic rules, because of the complexity and subjectivity of the issue, but residual value risk is considered to be pre-eminent.

The previous £150 million leasing deal did not satisfy private finance initiative guidelines, but was approved exceptionally as a step towards developing a rolling stock leasing industry. Any subsequent deal will need to go much further on risk transfer. The industry has always been fully aware of that position and the Department is ready to do whatever it can to clarify the PH rules and to assist in configuring the deal, for which there is a good business case to fit within those rules. I have given that undertaking on many occasions, both in the House and in discussions outside.

The Government are committed to privatising the rolling stock leasing companies during the course of this year, but at present it is British Rail's responsibility, as owner both of the RoSCos and of the operating companies, to assess the business requirements for new trains. There is therefore no question, as the hon. Member for Derbyshire, .North-East (Mr. Barnes) suggested, of privatisation being responsible for the present position on orders. Uncertainty is not a factor. If there is a good commercial case and acceptable leasing terms, I am sure that the legal structure of ownership need not be an obstacle.

In making that assessment, BR looks at such factors as the capital cost of the trains, the projected cost of maintenance and any revenue to be gained from greater speed or reliability—points to which some of my hon. Friends have referred. It also looks carefully at the comparative cost of maintaining existing units. This is not a theoretical exercise, but one based on detailed experience of the condition and current repair cycles of components.

When the rolling stock is passed over to the companies later this year, will the work and analysis that BR has done on the proposal to provide new trains on the Kent coast route be passed over to the leasing company?

I am sure that the work and the knowledge that has gone into the assessment of rolling stock requirements will not be lost when the RoSCos are privatised.

As we know, British Rail reached a decision not to exercise the option offered by ABB for replacement trains for Kent coast services. BR concluded that the current fleet could continue in service until 1999, when substantial expenditure on heavy engineering costs would have been required to keep the trains in service. That conclusion is clearly unwelcome news to many commuters and to many of my hon. Friends, but BR has a duty to look at the matter on a commercial basis.

Following the recent meeting between BR and hon. Members representing constituencies in Kent, however, BR indicated that it would wish to re-examine the commercial case if an improved offered were received from ABB. If BR then concludes that the negotiated deal represents good value for money, it would come to the Department with a case under the private finance initiative, and I give an undertaking to look at any such case urgently with my right hon. Friends both within the Department and elsewhere.

BR's recent decision not to exercise the option is not due to a lack of Government funding. BR rejected the proposal based on its assessment of the commercial need for trains. The November Budget settlement had no role to play in that judgment.

Tell us another fairy story.

The hon. Lady may like fairy stories, but I am trying to give the House the facts as they are.

British Rail has invested £4 billion in new rolling stock since 1979. Almost 4,000 new vehicles and locomotives have entered service in the past 10 years. In the former Network SouthEast area alone, more than 1,600 new vehicles have been delivered since 1986 for various lines. Overall support for the railways provides this year for investment of about £1 billion.

Will my hon. Friend bear in mind that if the issue is to be looked at again in 1999 or thereabouts and ABB has gone out of operation, the lack of competition in carriage production will mean that it may cost BR a lot more than it would if it went for the order now?

My right hon. Friend makes an important point which reinforces what I said earlier about the desirability of maintaining a vibrant manufacturing industry.

The hon. Member for York raised important questions about the safety of the remaining mark I electrical multiple units on former Network SouthEast services. It is an acknowledged fact that modern rolling stock designed with integral bodies has greater collision resistance than the older mark I stock. The same is true of developments in other modes of transport.

As regards day to day service, condition rather than age is the critical factor. All rolling stock is subject to a rigorous inspection and maintenance regime. Mark I rolling stock is fit for purpose in spite of its age. Rolling stock would not be put into service by BR if it was not fit for purpose.

I shall now deal with the specific recommendations in the reports on the Clapham and Cannon street accidents. Appendix G of Sir Anthony Hidden's report recognised:

"The inventory of Mark I coaching stock is large, and much of it has not reached an end of its economic life, nor will do so by another decade or more."

The report went on to say,

"it could be forcibly argued that there are more rewarding candidates for large capital investment in the railway than would be incurred by early replacement of these vehicles."

Sir Anthony Hidden did, however, recommend that British Rail

"shall carry out its stated programme of research into the structural integrity of its rolling stock within its planned timescale of completion by April 1991."

Recommendation 55 went on to say:

"On completion of the programme BR shall discuss its conclusions with the Railway Inspectorate and obtain their agreement to the structural changes necessary to strengthen all relevant rolling stock with a subsequent lifespan of eight years and over."

In April 1991, BR concluded that it would not be reasonably practicable to carry out structural changes to mark I vehicles. I understand that the Health and Safety Executive's railway inspectorate agreed with BR's conclusions.

The decision to replace the rolling stock involved in the Cannon street accident had already been taken by BR at the time that the inspector's report was published. I understand that the replacement programme for Kent link trains should be completed this April, when all the older trains will have been withdrawn on that route.

Turning again to Kent coast services, I recognise the urgency of the issue for ABB Transportation. BR is continuing discussions with ABB on a modified proposal. I am keeping closely in touch with developments and will continue to maintain close contact with my right hon. Friend the Member for Selby, my hon. Friend the Member for Ryedale and the hon. Member for York as matters develop. I think that we have had constructive discussions as the matter has developed, and I offer an undertaking to keep in touch with the right hon. and hon. Members concerned.

We are ready to help with the private finance aspects of any proposal that BR might submit to the Government. We are considering with British Rail how best to deal with that component. We do, of course, have recent experience of how a rolling stock deal can be fitted within the rules of the PFI, because we have recently concluded the agreement for the supply of Northern line trains for London Underground within the terms of the PFI.

This is not uncharted territory. There is a pattern, there are ground rules and there is experience on which we can draw. More immediately, however, it is for British Rail to decide whether there is an acceptable proposal which meets its business requirements, and it is for ABB to decide whether it can offer such a deal. If it can offer British Rail a deal that it cannot afford to refuse, with the help of my Department it should be possible to fit it within the rules of the PFI. I hope that the interests of both York and Kent can then be better served.

I rise today knowing full well that this is the first day of individual debates under the Jopling reforms. I must say, as a small aside, that I was no great supporter of the Jopling reforms and I remain somewhat cynical and sceptical about them. None the less, I am happy to have the opportunity to raise a particular issue of grave concern.

I am also grateful and happy to see my hon. Friend the Minister of State, Home Office, the Member for Penrith and The Border (Mr. Maclean) on the Front Bench. He has a great sense of justice and a concern that people should be treated fairly. I urge him to retain his usual talents in that regard, as I lay out the case before him.

I make no apology for the fact that the debate is peculiar in that it is about one particular individual, a constituent of mine. It may seem strange that I should have gone to the lengths of applying for a debate, but the case has wider ramifications. There are probably many other Mr. Dedmans throughout the country who suffer much the same sort of problem. I hope that they will be given some heart by my raising the matter. The case is fairly complicated, so again I make no apology for walking hon. Members through it slowly and in some detail.

On the night of 7 July 1992, the police were called to a boatyard at Point Clear, St. Osyth, Essex at the request of the yard owner. On arrival, they spoke to a Mr. Brown who claimed to be the owner of a boat called the Five Pennies. Mr. Brown produced three documents relating to the boat—a letter from the Metropolitan police about the theft of the boat, a witness order to attend the trial of a Mr. Lewis who was charged with the theft of the proceeds of the boat and a photograph of Mr. Brown with the boat.

Despite the fact that Mr. Dedman was known at the time to be the owner of the boat by the boatyard and had been so certainly for an established period, no one thought to contact him to counter the claim that a new owner had arrived on the scene.

The police officers looked at the documents and talked to the man and then gave their permission for the boat to be taken away. Mr. Dedman has believed for some time, and I suspect that he is right, that the police should have been much more suspicious about the time at which the individual chose to arrive at the boatyard and the fact that he at no stage urged them to contact Mr. Dedman to establish his claim. They should have been more cynical and, at the very least, made sure that the boat was impounded rather than allowing it to be handed over.

The problem is that the police officers clearly gave credence to Mr. Brown's story, and the security guards at the boatyard then bowed before them. A statement was taken from Mr. Brown and documents were photocopied, but he was allowed to take the boat away, and that is where the complications start. It was only the following day that Mr. Dedman was told about the removal—I say theft—of his boat, well after the individual had been and gone, at which stage he had no redress.

As I have said, at no time was Mr. Dedman contacted by the police, or by anyone for that matter, before the boatyard contacted him to tell him that his boat had gone. To put the matter in another context, I cannot imagine that, if the police were called to an incident concerning an important object of transport such as a car, they would never have assumed that someone else was the owner. They would have sought to check, using the numberplate, who was the licensed owner and to discover the correct procedure. Yet here the procedures seem to have collapsed and the police were happy to let the boat go.

Mr. Dedman contacted the police about the boat and was told by the officer concerned at the time that he had been satisfied from the documentation that Mr. Brown was the legal owner. I find that immensely strange because I have always understood the police to be cynical about getting involved in such cases, and that if they are sucked into them, they seek to make sure that they understand both sides of a case before pronouncing any opinion on a matter. Even then, they would be more likely to be reticent about giving approval. Yet here, approval seems to have been given, which carried huge weight.

It was subsequently proved that Mr. Brown was not the owner of the boat and knew so at the time of taking the boat from the boatyard. The Essex police then claimed that they could not have prevented it from being removed, yet they had been involved. Mr. Dedman discovered that the boat had been involved in a number of court disputes before he became its owner.

Mr. Dedman then sought redress through the courts. He sought redress against the police for their actions, but was told by the judge at Southwark Crown court that there was no case against the police. On 12 October 1993, the presiding judge dismissed Mr. Dedman's claim against the first defendant, Mr. Simkins, from whom he bought the boat in 1990, and his claim against the third defendant, the Essex police. Mr. Dedman was ordered to pay the costs of the Essex police and told to recover his costs from the second defendant, Mr. Brown. However, Mr. Brown was declared bankrupt on 16 March 1993.

All Mr. Dedman's efforts to obtain further information about the witness order addressed to Mr. Brown regarding the Lewis case, which Mr. Brown produced to the police on 7 July, have been unsuccessful. Therefore, Mr. Dedman has been unable to find out what Mr. Brown's involvement was in the case. The police and the courts have seemed unable, if not unwilling, to assist him.

So far, I have described many of the events that have led to Mr. Dedman's predicament. Now Mr. Dedman finds that he has to pay not only his own legal costs of £3,000 or more, but he is being hounded by the Essex county council's legal department for their costs of some £3,000. To top it all, our great judicial system leaves Mr. Dedman still without the boat of which he can prove ownership. On many occasions, Mr. Dedman has requested the police to impound the boat, so that once the matter is clarified he can take possession of it, but the police have refused to become further involved in the matter.

It is a remarkable position. Mr. Dedman seems to be being treated as though he has committed a crime. His crime, it appears, was to be stupid enough to own a boat of which somebody else decided that he should no longer have possession. It could be a comedy, were there not the personal tragedy in the middle of it that Mr. Dedman finds himself subject to injustice when he had expected .a just outcome.

I became involved in the case when Mr. Dedman came to me as a final and last resort, explaining that he did not know where to turn. He was being hounded for money, which he had great difficulty in finding. He had no boat to offset against the costs should he be forced to pay them because he could not take possession of it. It seemed that no one wanted to listen to him. In other words, he was a little man whose case no one wanted to resolve.

I took up the matter with the Essex police and it struck me that they wanted the matter dead and buried, but I suppose that that is no surprise. Superintendent Cotgrove wrote to Mr. Dedman saying:

"While the actions of Mr. Brown can clearly be shown to be shabby, it is the likelihood of proving dishonesty at the time of the offence that is relevant in the case of theft … I do have sympathy for the situation you find yourself in through no fault of your own in the light of the criminal law. Where that does not apply then, the police have no powers to prevent the removal of property."

In many senses that misses the real point. The police were present at the time and it was their involvement then that had a powerful influence on the case.

Superintendent Cotgrove continued:

"Having read the documents, the officer was certain that in 1989, Mr. Brown was the owner and therefore he could not stop him from taking the boat away, unless he had reasonable grounds for suspecting an arrestable offence was about to be or had been committed by Mr. Brown."

Why did no one contact Mr. Dedman?

The attitude seems to have been that perhaps there had been a small mistake or problem, but, "For God's sake let us clear it out of the way and shut up shop. Mr. Dedman will have to sort out his own problems. Perhaps we should not have become involved, but it is not our fault." No one thought to contact the legal owner of the boat. I find that one failing remarkable: having chosen to be involved and to give their opinion, the police did not even bother to find out whether the legal owner disputed the change of ownership.

I took the matter up with my right hon. and learned Friend the Home Secretary and with the Lord Chancellor. Their letters to me expressed sympathy, but made it clear that they could do nothing to assist Mr. Dedman. I am fully aware of that. I brought the matter to their attention as much because I felt that there was a problem in the operations of the police and the courts if such a problem could arise as because I wished to resolve Mr. Dedman's individual difficulty.

The age-old concept of justice not only having to be done but having to be seen to be done cannot be sufficient if cases such as this arise. It is clear that Mr. Dedman has not been treated fairly. It seems far more important that justice can sometimes be interpreted as "having your day in court", that is good enough; case dismissed. This case is really more about right being done through the legal procedures, which has not happened.

I seek the advice of my hon. Friend the Minister. What can my constituent do? I suspect that my hon. Friend will find it as hard as I do to say where we go from here; the options are clearly limited. There are several possibilities, however. The public may ask why on earth the police and others are not co-operating to try to resolve the issue, rather than shutting the door on Mr. Dedman: there must be a way of resolving it.

The case may seem petty, but it is not. If Members of Parliament have a purpose, it is surely to make certain that the Mr. Dedmans of this world are not crushed by the system. The system clearly could not care less what happened that night; it seems that those involved merely wish to bury the case as fast as possible—and, if necessary, to bury Mr. Dedman with it. Does my hon. Friend agree that there is a case to answer? If only those involved had learnt to co-operate, the issue might well have been resolved at an early stage. I urge my hon. Friend to act, or at least to advise me.

I thank my hon. Friend the Member for Chingford (Mr. Duncan Smith) for raising an important matter concerning what he believes to have been an injustice. He mentioned the Jopling rules. My right hon. Friend the Member for Westmorland and Lonsdale (Mr. Jopling) is my neighbour in Cumbria; while some of us greatly appreciate the benefits of the Jopling rules governing Thursday evenings, those benefits will sometimes be offset by the inconvenience of having to cancel Wednesday morning appointments.

I assure my hon. Friend the Member for Chingford that I appreciate the anger and frustration that his constituent must feel. I am not a boating enthusiast—I get rather scared on any boat smaller than the QE2 with full stabilisers, not that we can afford to travel on the QE2 on our parliamentary salaries. It is said, however, that there are two happy days in the life of a boat owner: the day he buys his boat, and the day he sells it. I do not know about that, but I am sure that my hon. Friend's constituent rues the day on which he bought the Five Pennies. Some might feel that there is an irony in that name, in view of how much the purchase has cost him. I assure him, however, that he has the House's sympathy in what has been a most unfortunate case.

My hon. Friend explained in some detail how his constituent has been left without his boat and with legal bills amounting to some £4,000, and I do not think that there is any dispute about those facts. It may be useful if I summarise the events that led to the case coming before the House; in doing so, I shall draw particularly on the judgment of His Honour Judge Simpson, who presided over the civil action brought by my hon. Friend's constituent.

In 1990, Mr. Dedman bought a motor boat and took it to a boatyard in St. Osyth, in Essex. The boatyard was a secure compound, and about 20 boats were kept there on trailers. Between September 1990 and 1992, Mr. Dedman and his brother used the boat on most Sundays during the season, but all that changed on 7 July 1992, when a Mr. Brown took the boat from the yard.

As my hon. Friend has explained, Mr. Brown was the previous owner of the boat; but he had sold it, using a third party as agent. The boat was properly sold, and a good title eventually came to the Dedman brothers. However, the third party who acted as agent did not pass on the sale price to Mr. Brown, and as a result the agent was later charged with the offence of theft and appeared at Snaresbrook Crown court.

Mr. Brown, however, thought that his boat had been stolen, and His Honour Judge Simpson specifically said that he could not be criticised for that. Mr. Brown saw the boat at the St. Osyth yard and announced his intention to tow it away, whereupon the manager of the yard called the police.

A Police Constable Summerfield answered the call and arrived at the boatyard. Mr. Brown showed him three documents, one of which was a letter from the Metropolitan police dated 4 December. Unfortunately, the letter referred to the theft of the boat rather than to the theft of the proceeds. The mistake was important: if the boat had been stolen, under the Sale of Goods Act 1979 Mr. Dedman would not have had good title to the boat, and Mr. Brown would have been fully entitled to do as he did and take it away.

The judge accepted that PC Summerfield did not know of the inaccuracy in the Metropolitan police report. PC Summerfield did not get in touch with Mr. Dedman at the time because he was called away to investigate a burglary, but he contacted Mr. Dedman the next day and told him what had happened.

I accept that the police constable was called away. Surely, however—having felt some sympathy with Mr. Brown and, perhaps, established in his own mind that Mr. Brown was the boat's owner—he should logically have said that the boat could not be removed until he had confirmed Mr. Brown's ownership by talking to Mr. Dedman and seeing what documents he produced. Surely it was wrong for the police constable to make such a judgment—rushed or otherwise—at the time.

Police officers are not judges in civil disputes; they are not civil arbiters. They must make a judgment about whether a crime is being committed, has been committed or is about to be committed. Was this likely to be a theft, or was a theft about to take place? The police constable formed the view that a crime had not been committed and was not about to be committed, and it was not up to him subsequently to determine the validity of the civil case. I shall say more about that shortly.

My hon. Friend's constituent later sued Mr. Brown, the person from whom he had bought the boat. He also sued the police. The case was heard at Southwark Crown court in October 1993; Mr. Brown did not appear to defend himself, and an interlocutory judgment was entered. Mr. Dedman, however, was unsuccessful in obtaining compensation from Mr. Brown, who claimed to have sold the boat and was declared bankrupt.

I think that the House will accept, as I do, that my hon. Friend's constituent has had a very raw deal. Unfortunately, that sometimes happens. Where I must part company with my hon. Friend is in his belief that his constituent's misfortunes are the fault of the police. In coming to that conclusion, I am not making a personal judgment in my capacity as a Minister: I am relying on the judgment of the courts.

As my hon. Friend is aware, the investigation of crime, the action and decisions which are taken by police officers in the course of their duties are operational matters. They are the responsibility of the chief officer of the force concerned, and Ministers have no authority to intervene. Therefore, it would not be right for me to comment on the way in which an individual operational case was handled.

As the House is aware, my hon. Friend's constituent brought a civil action against the chief constable of Essex and, as I have mentioned, the court dismissed the case. I think it might be useful if I read from Judge Simpson's judgment. It is a long quote but it is useful to put it on the record as my hon. Friend will wish to be aware of it. The judge said:

"PC Summerfield himself told me that he examined the boat, read the documents, took a statement from Mr. Brown who was adamant that he would take the boat unless he could be given some reason why he should not. Having read the document, PC Summerfield felt 100 per cent. certain that, in 1989, Mr. Brown was the owner, and that he could not stop him from taking the boat away. PC Summerfield explained the powers that he had as a police officer and said he could not restrain Mr. Brown unless he had reasonable grounds for suspecting an arrestable offence was about to be committed. He did not give permission or encouragement and could not stop him. The officer cannot be criticised merely because he read the document and had no powers to stop Mr. Brown. In those circumstances I have no hesitation in saying that the action against the Chief Constable of Essex was misconceived. They had no powers to prevent Mr. Brown and no permission or encouragement was given, the action is dismissed as against the third defendant."

My hon. Friend has also criticised the police for failing to prosecute Mr. Brown. As my hon. Friend is aware, a file was passed to the Crown Prosecution Service, which decided that there was insufficient evidence to show that Mr. Brown had acted with dishonest intent. Therefore, no action was taken against him.

The decision whether to prosecute rests entirely with the Crown Prosecution Service and not with the police. The police's involvement in the decision on whether to proceed ends when the file leaves their hands and is passed to the CPS.

My hon. Friend asked where to go from here so that his constituent could get some satisfaction. If my hon. Friend's constituent is still dissatisfied, as I perceive he is, it is of course open to him to register a complaint against the police. I understand that at no stage has he decided to take that course, not even in 1992 before the matter went before the courts. No doubt, before considering that step, Mr. Dedman would wish to consider the finding of the court that the police constable who was involved in this matter was in no way to blame. The complaints system exists so that members of the public see that their concerns are scrupulously investigated.

I shall now deal with the role of the Police Complaints Authority and remind the House of how the system works. Under the Police and Criminal Evidence Act 1984, members of the public can register complaints not only with the force concerned but through a citizens advice bureau, through hon. Members or direct to the Police Complaints Authority. All these avenues were open to my hon. Friend's constituent.

The Police Complaints Authority is required by the Act to supervise the most serious complaints. This is defined in the Act but, briefly, it covers those cases which involve death or serious injury. It also has discretion to supervise other complaints, and a duty to supervise non-complaint matters voluntarily referred by police forces because of their potential gravity, and to make reports to the Secretary of State. Finally, the Police Complaints Authority must review the outcome of every investigation, whether supervised or not, and decide whether disciplinary action should be taken against any officer.

I understand that my hon. Friend wrote to Sir Leonard Peach, chairman of the Police Complaints Authority, on 2 August of last year requesting an investigation into the way that Essex handled this case. Sir Leonard wrote to my hon. Friend saying that he understood Mr. Dedman's sense of injustice but warning my hon. Friend that it was unlikely that the Police Complaints Authority could be of much practical assistance in view of the judge's comments.

Sir Leonard also pointed out that the legislation required complaints to be formally recorded by the relevant force. He offered to make the necessary approach to the chief constable but required confirmation that Mr.

Dedman wished to pursue a formal complaint against the officer concerned. It may be helpful if I read to the House Sir Leonard's reply.

I am grateful to the Minister for taking so much time over this matter. However, the point that must be made is that, in the midst of all this, Mr. Dedman is being hounded for costs. In many senses he is worrying about his financial state and is not thinking any more about taking the matter further because, frankly, he cannot afford a moment. The fact that he is being hounded is very much part of the reason for the tremendous hesitation about where he goes from here.

I understand that there is no cost for registering a complaint with the Police Complaints Authority. The difficulty is that Mr. Dedman pursued a case in the civil court against Essex police. The judge said that the case was misconceived and, rightly in my view, did not award the compensation that Mr. Dedman wanted. Mr. Dedman lost that misconceived case and has inevitably incurred costs of his own and police costs. However, Mr. Dedman won the case against Mr. Brown and that would be the perfect solution to the problem. Mr. Brown had a liability to compensate him but the problem is that Brown was declared bankrupt. Therefore, Mr. Dedman has not got his compensation from the one person who should compensate him. Because he failed to get that from the appropriate party, it is not right to sue others such as the police.

It is misconceived to look to an alternative pocket. I am relying on the judgment of the court in favour of Mr. Dedman against Mr. Brown. Mr. Brown is the one who should pay compensation. The court ruled that it was entirely misconceived to try to sue Essex police, and I must rely on that judgment. I think that it is right.

I was about to quote from the letter of Sir Leonard Peach but as my hon. Friend has seen a copy I shall skip that. It is of great interest to my hon. Friend but perhaps other hon. Members are not so interested.

The Police Complaints Authority does not supervise investigations or consider complaints about operational matters. While I appreciate that this must occasionally seem unfair to members of the public, I must invite the House to consider that there really is no alternative. Unfortunately, crime has been in existence as long as ownership. The police work extremely hard in crime prevention and at detecting the perpetrators of crimes. The House recognises that they have a very difficult job.

It would be wholly unreasonable to require the police to take responsibility for being unable to prevent a crime taking place. If it were otherwise, we would need to recruit half the nation as police officers and have them keep a 24-hour watch on the other half. The courts have accepted that, as a matter of public policy, the police have immunity from action over their conduct of an investigation of a particular case, but such immunity was not an issue in this case, which was considered on the facts. I certainly would not like my hon. Friend or the House to get the impression that it is not possible successfully to bring a case against the police.

In general terms, the police are liable for their actions in the same way as other members of society. Under section 48 of the Police Act 1964, a chief constable is liable for torts which are committed by members of the force under his direction and control. The police authority must pay any damages which may be awarded against him by a court.

I accept that this provides little comfort to my hon. Friend's constituent. Unfortunately, it is not possible for the law to be able to satisfy every eventuality. I am aware that in this case my hon. Friend's constituent had good title to the boat. His redress should have been through the civil courts. What was particularly unfortunate about the case, as I said to my hon. Friend a few moments ago, was that, having won the court case against Mr. Brown, the fellow who took the boat away, my hon. Friend's constituent did not receive any compensation because Mr. Brown had been declared bankrupt. I accept that this may be scant comfort, but the liability against Mr. Brown still exists.

Many others, apart from my hon. Friend's constituent, have lost out because of difficulties surrounding title of goods. People who inadvertently buy stolen goods, maybe stolen cars, boats or anything else, do not have any recourse to law. That is a matter of real concern to people who make purchases in the second-hand market.

The Government have taken action through the crime prevention strategy to reduce the opportunity for crime by encouraging the public to undertake a range of measures such as property marking.

Order. Time is up.

To put this brief debate in context, I must refer to the current discussions in the Nolan committee and the evidence that has been given to that committee. I can best illustrate the significance of the health appointments by quoting from an article by Mr. Simon Jenkins in The Times last Wednesday, entitled "Is Nolan just a paper tiger?" Mr. Jenkins is a former editor of that paper and he is scarcely a dangerous radical, so his recommendation that the Nolan committee should ask for an independent royal commission on appointments deserves the attention of all hon. Members.

Mr. Jenkins wrote:

"If ministers protest hand on heart that no thought of party gain ever crosses their minds when it comes to jobs or honours, a way is open to them to set the public's mind instantly to rest. They can divest themselves of these powers. Ministers should continue to propose appointments, but to the new commission, not to Downing Street. The commission would be expected to listen and act reasonably. Some 42,000 posts in executive quangos are now available for public appointment. More Britons are appointed in a lay capacity to oversee such services as hospitals, schools, the police and social services than are chosen at elections."

He goes on:

"As for the 15,000 health authority posts that had to be filled in 1991, it was that most undignified case of catch-as-catch-can in the history of public patronage. On seeing his list, one health administrator paraphrased Wellington and hoped they would 'terrify the consultants as much as they terrify me.'"

In the south-west, we have had a number of terrifying incidents in the way in which health trusts have performed their duties. We had, first, for example, the collapse of confidence in the Westcountry Ambulance Service trust, which resulted, after pressure from hon. Members on both sides of the House, in the exit of the chief executive. Secondly, we have had the suspension of Sister Cooksley at the Plymouth Hospitals NHS trust; again, a U-turn and reinstatement resulted. Thirdly, we have had a series of important and worrying incidents at Treliske hospital, run by the Royal Cornwall Hospitals NHS trust. With the latter, of course, a number of inquiries are going on.

The questions that all hon. Members will wish to have answered are: who is in charge, who is answerable and to whom? Who says, "Out you go," if a trust fails? A crisis of confidence exists in the trust leadership. Why? One reason is that the public, the patients and their elected representatives feel that they have no significant role in the appointments procedure.

There was a perceptive series of articles in the Western Morning News at the end of last year entitled, "Who really runs the west?" I wish to quote briefly from an important article, headed "Why Tories tend to be picked to serve on health quangos." The article starts:

"A glance down the list of Westcountry health quangos shows a distinct bias towards Conservative chairmen and board members."

It continues:

"At the top of the health pyramid is the South West Regional Health Authority, which nominates chairmen of local hospital trusts and passes names on to health secretary Virginia Bottomley.

One of the SWRHA's six board members is Dame Margaret Fry, a leading Conservative grandee who chaired the annual party conference three years ago."

The article then takes a number of examples of people who, in recent months or years, have been appointed to health trusts. For example, Mrs. Sylvia Russell is described as

"a frank speaking former Tory councillor who was given the £17,000-a-year job of running the Exeter and District Community Health NHS Trust."

Mrs. Russell is reported as saying:

"Mrs. Bottomley has been very keen indeed to promote women into management. Rennie Fritchie (SWRHA chairwoman) is keen to promote women."

The article gives another example of Mr. Graham Andrews, a former North Devon Conservative councillor, who again was appointed as a director of the Northern Devon Healthcare trust.

The main body of the article concerns the curious saga of the appointment of Mrs. Abigail Kirby-Harris, who is described as follows:

"once chairman of the St. Mabyn Conservative Association in North Cornwall, who said that it was not the slightest bit surprising that the Government should choose Tories to push through health reforms.

She added that it was natural for Ministers to pick allies to run NHS trusts ahead of people who wanted the reforms to fall flat on their face.

It was Mrs. Kirby-Harris's appointment, in the face of outspoken opposition from local Members of Parliament and some members of the NHS trust itself, which focused Westcountry attention on the way people are chosen for key quango jobs.

She was nominated by a member of another quango—Dame Margaret Fry—and rubber-stamped by the Secretary of State for Health, who was determined to put more women into top NHS jobs."

Will the hon. Gentleman give way?

I shall not give way, because I want to leave time for one of the hon. Gentleman's hon. Friends, who told me in advance that he wished to take part in the debate, as is the normal convention.

As the Western Morning News correctly pointed out, Mrs. Kirby-Harris's appointment was controversial. First, Sir Godfrey Milton-Thompson, who was the chairman in situ, was expected to continue. Having had a distinguished career in the services, rising to surgeon vice-admiral, he clearly had great expertise. Secondly, when consulted, all five Cornwall Members said that they were happy for him to continue. The hon. Member for St. Ives (Mr. Harris) said:

"I don't see any reason why he should not have been reappointed. I thought it was Virginia Bottomley with her obsession with every post going to a woman."

The hon. Member for Cornwall, South-East (Mr. Hicks) asked if he might take part in the debate and I hope that he will catch your eye, Mr. Deputy Speaker. As a parliamentary neighbour and former sparring partner, I welcome him to the debate.

Thirdly, in December 1992, before the appointment was confirmed and publicised, other Cornwall Members and I corresponded with the then Minister for Health, the right hon. Member for Peterborough (Dr. Mawhinney). I wrote a fairly quiet letter. The hon. Member for Cornwall, South-East wrote in more robust terms. The Minister's answer shows what had happened. The Minister wrote to me:

"When my office passed on to me your further message about the appointment of the Chairman of the Cornwall Healthcare NHS trust, I instituted an urgent enquiry into the handling of the information you conveyed to South Western Regional Health Authority in your telephone call.

I can confirm that your message was received by the Region after the submission being sent to me by my Appointments Unit. Your views on Sir Godfrey and Mrs. Kirby-Harris were, therefore, not expressed in that submission.

It appears that, if your views were relayed to the Appointments Unit at the Department, they were not recorded and were certainly not passed on to me at any time. I have made it clear to the staff concerned that this is not acceptable and that our arrangements have got to be tightened up in future. I am extremely sorry that the system did not work on this occasion.

The submission I received did inform me however that Robert Hicks and David Harris both favoured Sir Godfrey being appointed. Having said that, for reasons I sought to explain to you when we spoke and which I have already explained to Robert, the advice I received from a range of other sources strongly recommended that Mrs. Kirby-Harris should be appointed. I felt, therefore, I was not able to accept Robert's and David's and, I now know, your advice on this particular occasion."

I want to get some positive lessons from this unfortunate incident. First, what references were taken up for this appointment? Secondly, what references are today taken up for such appointments? What written reports were available to the Secretary of State for Health? In this case, the person concerned had served from the Army and we now know from the industrial tribunal that has taken place since that the disclosed reports in the Army would have made it clear to the Secretary of State that there was no way in which this candidate should be even considered for half a minute for such an important appointment. The reason why she has been to an industrial tribunal is that she is claiming £500,000 for wrongful dismissal due to pregnancy. Thirdly, what is the point of consulting local Members of Parliament if our advice is then ignored?

Fourthly, there seems to be at least the suspicion of a hidden agenda, some sort of discrimination on grounds of gender, age or political orientation. Fifthly, why not advertise openly and set out the experience and criteria for which the Secretary of State is looking? After all, we are talking about considerable responsibilities—whether on an authority or a trust—and the people appointed exercise considerable control on the public's behalf over huge budgets.

I believe that Mr. Simon Jenkins's suggestion that there should be a royal commission on appointments and that there should be an open and honest process for such appointments is the only credible way forward to regain public confidence in the integrity, objectivity, ability and representative nature of those who run the national health service.

People do not trust the trusts and it is in the Secretary of State's hands to set that right. I hope that the Minister will be able to reassure us at the end of this brief debate.

I am grateful to the hon. Member for North Cornwall (Mr. Tyler), my parliamentary neighbour, and to the Minister for allowing me two or three minutes in which to make a contribution to this important debate, which clearly has national implications as well as implications in Devon and Cornwall.

I would not necessarily go along with all that the hon. Member for North Cornwall said about the importance of political connections in this respect. There may be a political dimension to the examples that I shall cite, but what concerns me more is that some elements of the appointments affecting my constituency have too many characteristics of a Whitehall farce. I shall therefore concentrate on the procedures followed in making such appointments.

I begin by paying tribute to my right hon. Friend the Secretary of State for Transport who, when he was Minister for Health, was most helpful and forthcoming. When I attempted to investigate the procedures followed in such appointments, it was not clear who, under the existing arrangements, was prepared to accept the ultimate responsibility. In the three examples that I shall cite, the Secretary of State played a significant part, whether in her present role or in her previous position in the Department of Health.

It is not clear whether the ultimate responsibility lies with the Department or with the regional health authority. Ministers tend to say that they can act only on what appears on their desks and it is not clear what terms of reference they have issued to the RHAs in the first place. The RHAs themselves say that they have certain parameters within which to work, but one then calls into question the sifting mechanism that they have deployed when names have supposedly come to their attention from the grass roots.

The hon. Member for North Cornwall outlined the sequence of events that accompanied the appointment of the chairman of the Cornwall Community Healthcare trust. I shall not duplicate his comments but wish to refer to the initial appointment of the chairman of the Royal Cornwall Hospitals NHS trust. My right hon. Friend the Secretary of State consulted certain politicians representing the county, although she did not ask the advice of the two then longest serving Members, David Mudd and myself. Perhaps she did not expect to hear the response that she was seeking. In any event, she went ahead—as was her right—and made an appointment.

It is not without significance that, when the time came for a reappointment, the Secretary of State's original appointee was dropped and replaced by the person whom some of us had advocated in the beginning.

There then followed a sequence of events beyond one's imagination, involving the appointment of the chairman of the Plymouth Hospitals NHS trust. My right hon. Friend appointed the late chairman and managing director of Brymon Airways to a trust that had not even been designated at the time. Within a few weeks, he had to resign from the non-existent trust and, as it so happens, the person whom we thought was being groomed locally for the position—then the chairman of the Plymouth health authority—was appointed chairman of the Plymouth Hospitals NHS trust, now that it finally exists. If the procedures had been correct in the first place, I suggest that we should not have reached this farcical situation.

We are talking about the administration and provision of health care for a large number of people, including my constituents. Public confidence in that administration and provision is absolutely essential. When the public read objective reports of what has happened in the three cases that have been mentioned, they understandably feel a little apprehensive.

I measure my words carefully. I believe that, if the litigation involving the former chairman of the Cornwall Community Healthcare trust turns out in a particular way, those responsible at the ministerial level for appointments and those who still hold senior positions within the regional health authority must examine their own positions. It is clear that what has been happening hitherto must not be repeated in the future if we are to retain the public's confidence in the standard of health care in the parts of Cornwall and Plymouth to which reference has been made this afternoon.

I am sorry that we do not have more time to debate the important matter raised by the hon. Member for North Cornwall (Mr. Tyler). I could not help noticing, from the Order Paper, that a pile of earth in south-east Asia is deemed to be so important that it takes up three times as much time as the question of who runs the national health service. Perhaps that is a manifestation of the extent to which we are ruled by the headlines these days. This is an important subject because enormous responsibilities are placed on non-executive members of boards and the chairmen of health authorities and trusts in the health service.

I must correct the impression given—unintentionally, I am sure—that everything was wrong with the appointments that have been made. There are cases with which hon. Members are dissatisfied but some splendid people have become chairmen and non-executive members of trusts and health authorities. I visit a great many trusts—acute trusts, community trusts, ambulance services and health authorities—and meet many non-executive and executive directors who are extraordinarily committed to the health service. Many would die for the hospital with which they are involved, which is very rewarding. Indeed, the level of accountability and responsibility that they feel is one of the reasons that there have been some remarkable successes.

Since the hon. Member for North Cornwall (Mr. Tyler) started his speech by saying that he was referring to the whole of the south-west, does my hon. Friend agree that the Taunton and Somerset hospital trust in my constituency, among others, has been remarkably successful, that on its board there are members of all parties and of none, and that its success is despite the vigorous opposition of the Labour party and the Liberal Democrats before it was set up?

I could not agree more. Taunton and Somerset is a good example of a trust that knows where it is going and is well led, which is exactly what we have been trying to achieve.

Obviously, one can find problems in a huge organisation such as the health service, with some 8 million in-patients, another 35 million out-patient contacts and nearly 1 million employees. There is room for many things to go wrong. I am not quite sure of the connection between the three examples with which the hon. Member for North Cornwall began his speech—the Westcountry Ambulance Service trust, Sister Cooksley and two incidents in the press recently about Treliske—and non-executive appointments. Therefore, we need to be careful about using the material provided by headline writers, serious though some of those incidents may be, to make a wider point.

I have paid tribute to the non-executives of our trusts and health authorities because under them there has been remarkable progress. Many, many more people have been treated. Over 120 patients are treated today for every 100 treated before the reforms came into place. That is a tribute not only to the boards but to the staff generally for taking on an extraordinarily larger work load, albeit with some additional resources. Hospitals have become much more efficient—they have had to cope with the rising demand for health care.

Waiting lists and waiting times are much in the news. Under the reforms, in hospitals and authorities on which those non-executives serve, we have found that the average waiting time for operations has fallen from nine to five months and that the time people wait for a first consultant appointment has fallen radically. Many health authorities, before we set any national standards, were demanding that people should not wait more than a certain number of months, usually in single figures in good cases, for their first consultant appointment. So much progress has been made.

Partly, the chairmen and non-executives have been driving that progress, sometimes with not much encouragement from medical staff who have said that to think constantly about waiting lists distorts priorities and medical staff should have total control over the priorities of any hospital. However, we know, from our constituents and from everything that we find, that waiting times are important to patients, however lacking in urgency their conditions, and they should not be told that they will have to wait two years to see a consultant. Certainly, they should not discover that they need certain treatment and be made to wait years for it.

We are bringing those times down to 18 months, to 12 months and to less, so that people will not be able to say that they do not know when they will be treated. That will become a thing of the past. Under the leadership of some of our chairmen and chief executives, that has happened. However, I agree that there is a lack of uniformity in the appointment system, although it has thrown up thousands of good, committed people. Because people have found the opposite in some cases, we have sought to find a more formal system which people outside will be able to understand.

The first stage of the process is to require all regional health authorities or regional members of the policy board, as there may be if the Health Authorities Bill reaches the statute book, to advertise all posts or groups of posts—there may be difference in procedure between one area and another. There should be free and open advertising so that people can write in to say that they would like to serve on a trust or health authority.

When that stage is complete, a panel of non-executives, usually from around a region, will sift through those names to decide which of those people would appear on the face of it to be suitable to serve on trusts and health authorities. The panels should do that according to agreed criteria.

I am conscious of the limited time, but could the Minister specifically address the question of short lists in the cases to which the hon. Member for Cornwall, South-East (Mr. Hicks) and I referred? As we all know, there was an unmitigated disaster with one appointment because only two people were on the short list. The person appointed turned out to be totally unsuited to the post, while the person who was, in effect, ejected, was subsequently to take the Department to an industrial tribunal. Again, in the Western Morning News, headlines said:

"Payouts settle complaint of jobs for girls",

and:

"Bottomley spared appearance in sex discrimination case".

All that could have been avoided if the short lists had not been so short.

I understand why the hon. Gentleman is harping on about that unfortunate case, although I repeat to those hon. Members just arriving in the House that it was totally unrepresentative of the generality of health appointments. However, clearly the hon. Gentleman is quite right: we need a larger pool of names from which those who have the task of sifting can draw candidates. Competition is likely to hot up because, surprising though it may seem given all the difficulties and all that is said about the health service, large numbers of people wish to serve as non-executives on health authorities and trusts.

As I said, having advertised, the candidates must be looked at against published criteria. We shall be dealing with guidelines on that criteria in the near future and it will be open for everyone to see the personal and career criteria that we would like to see for those people who serve in that position in the health service.

There is also of course a code of conduct and accountability, very much along the lines of the Cadbury report, covering all matters of governance of public companies and public organisations. All those who serve and who are appointed will be reminded that they must have very high standards of achievement in those sectors. They must maintain standards of discretion, and in all the areas that one expects of someone who is put in a position of great responsibility in a public organisation. That is important.

I very much regret the cases—some may be quoted—when the system has failed to satisfy or, indeed, has resulted in the appointment of people who turned out to be unsatisfactory. While they are in a minority, we seek to avoid such cases.

I shall deal with the objections put forward by my hon. Friend the Member for Cornwall, South-East (Mr. Hicks), who said that he and local Members of Parliament were consulted on appointments and it appeared that their advice was not taken. We cannot give an absolute guarantee to hon. Members, because, clearly, as the House will understand, views of local Members of Parliament are one source of advice on appointments and there may be many other views from other organisations, from individuals and, indeed, from an interview process that, up to now, has been conducted by regional chairmen or district chairmen. Interviews tended to be conducted by regional chairmen when appointments of chairmen for districts were being made.

We cannot guarantee that the advice of our parliamentary colleagues will be taken in every case, but we can at least say that consultation is taken extremely seriously and that all views, especially those of our parliamentary colleagues, are taken into account and always have been.

My hon. Friend the Member for Cornwall, South-East asked who is responsible in the Department of Health. Clearly my right hon. Friend the Secretary of State is ultimately responsible for all appointments, but there are some divisions of responsibility. She takes advice from different ministerial colleagues within the Department, depending upon which part of the country is involved. An enormous selection process has to take place. It happens mainly at regional level, but it also requires a great deal of work by Ministers, who monitor the recommendations made by the regions. That process is shared out round the country.

There will be a more codified system of appointments in the health service, and it will be open and understood. We value trust boards enormously as a central part of the reforms; they cost the NHS 1p out of every £11 spent by a trust, and we think that that is good value. I pay tribute to all who serve on trusts and health authorities, often in difficult circumstances, for the wonderful job that they do.

It being half-past Two o'clock, the motion for the Adjournment of the House lapsed, pursuant to Order [19 December].