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8.55 pm

Mr. Harry Barnes (North-East Derbyshire): I wish to make two small points. First, I thank the Liberal Democrat spokesman—a temporary spokesman on this issue—for his kind remarks, which I shall spread across north Derbyshire so that people will be aware that there is at least some appreciation of the matters that I sought to propound on Thursday. Secondly, I wish to pick up a point made by the hon. Member for Eastbourne (Mr. Waterson) which he also made in Committee. He talked about pathological optimists, a phrase that I shall use in a different context.

I am still trying to appeal to the Government to take into account public interest considerations and perhaps I am a pathological optimist to believe that they will

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introduce such measures in the Lords. However, strong representations have been made which have been only partly heard in the Chamber. The TUC and major trade unions are greatly concerned about the withdrawal of public interest considerations which, indeed, they want to expand. Instead of being enabling measures, as they were in the Fair Trading Act 1973, they should be matters which we should be obliged to instigate and act upon. The least that we can do is to try to hold on to what was introduced under the Heath Government in 1973. It seems that new Labour will not go beyond that stage, but as it becomes more mature, I hope that it will take into account the points that I have made. However, I am sorry that the Government have lost interest in the public interest.

8.58 pm

Mr. McWalter: I want to say something about a defining characteristic of the Bill. A lot of people complain that the Bill is not quite there and say that things are missing from it. For example, it does not include anything to contradict the assertion of the hon. Member for Orkney and Shetland (Mr. Carmichael) that we are introducing a Tebbit doctrine for the unalloyed operation of competition as an economic force. One of the great strengths of the Bill is its provisions on anti-competitive practices, including stop now orders and the attempt to try to produce a culture in which people challenge an existing business regime to develop new enterprises that produce services and goods in new ways. It is a jewel within a crown, as it were—[Interruption.] No doubt, this is a popular analogy in jubilee year. The crown itself is the raft of policies that the Government are introducing, not to produce Tebbitised competition, but to produce fair competition.

I think that that is tremendously important, because fair competition is not achieved only by introducing a measure such as the Bill. Among other things, it is achieved by bearing down on enterprises that cheat. That is the case whether they cheat their customers—there is a strong desire to ensure that consumer law is amplified and improved—or whether they cheat the environment, by polluting it, or their workers, by underpaying them. The Government have introduced legislation to try to ensure that companies cannot cheat their workers too much. They cannot do so, for example, in respect of the minimum wage and the right to be recognised by a trade union. The effect is to create an environment that makes competition between companies fairer than it would ever have been under a Tebbitised doctrine. So the first thing that the Bill does is contribute to an environment in which entrepreneurial activity is given a genuine boost, and that is how it should be read.

The second issue is what the Bill does not do, in terms of the contribution of the right hon. Member for Wokingham (Mr. Redwood): it does not propose in a Tebbit or Redwood way that competition is the answer to every economic puzzle. It manifestly is not the answer. For example, to cite the recent report of the Select Committee on Science and Technology, of which I

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happen to be a member, it is clear that to establish wave and tidal power systems that achieve non-carboniferous energy generation, there may be a need for a time scale of, say, 50 years, and an investment plan far exceeding anything that the normal market would be willing to produce and develop. That is a role for Government as assuredly as the delivery of health services to people who are poverty stricken is a function for Government.

Let us be clear: the Bill is saying not that every economic problem has a competitive answer, but that where competitive elements are possible, they should be fostered, encouraged and nourished. For instance, if the Government start along the path of major long-term investment in wave and tidal power, and start to issue many subcontracts as part of that grand scheme, it would be utterly inappropriate for them to try to cosset and keep to themselves all those contracts and all that activity, ingenuity and capital. It would be absolutely right for them to try to find partners, in whatever sector, and whether that involved other countries, companies and so on, to bring forward such a project as effectively as possible.

The Bill does not do what some hon. Members—they include the hon. Member for Orkney and Shetland, in his way, and some Labour Members—have suggested, and propose an agreement with my right hon. Friend the Member for Hartlepool (Mr. Mandelson), who said that we are all Thatcherites now. If the Bill is read as a component of a strategy for fostering business and enterprise, but one that does that in a way that maximises social responsibility and uses appropriate economic instruments for the multifarious economic problems with which this country and its people are faced, I believe that it should be very much welcomed by all hon. Members.

Question put and agreed to.

Bill accordingly read the Third time, and passed.


Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),

Fees and Charges

Question agreed to.



That, at the sitting on Wednesday 19th June, the Speaker shall put the Questions necessary to dispose of proceedings on the Motion in the name of Mr. Robin Cook relating to House of Lords Reform (Joint Committee) not later than three hours after the commencement of proceedings on the Motion; such Questions shall include the Questions on any Amendments selected by the Speaker which may then be moved; the Questions may be decided, though opposed, after the expiration of the time for opposed business and the Order of 28th June 2001 relating to deferred Divisions shall not apply to them.—[Mr. Jim Murphy.]

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House of Lords Reform

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Jim Murphy.]

9.5 pm

Mr. Eric Joyce (Falkirk, West): One of the more enduring legacies among many that the Government will pass on to future generations will be their constitutional reform programme, which has achieved a great deal to date and is an evolving process that continues apace. The Scottish Parliament, the Welsh Assembly and the Northern Ireland Assembly have been considerable successes in their own way. There have been significant teething difficulties in some respects, but by and large the great majority of people who live in those parts of the United Kingdom believe them to be considerable successes. The roll-out of regional democracy looks set to continue in England, both through new mayoral elections and the introduction, I hope, of regional assemblies.

At a different level of government, there is a need to reform the House of Lords, and that, too, is moving ahead apace. I want to stress why House of Lords reform must take place in a way that is complementary to, not competitive with, the roll-out of regional assemblies and subsidiarity across the United Kingdom. A couple of months ago, my right hon. Friend the Leader of the House took part in a conference in London on that subject organised by the Scottish Forum for Modern Government. The matter has been the subject of some discussion, but I want to air one or two points that I fear otherwise might not see the light of day.

The first of those points is timing. Notwithstanding the work of the Joint Committee of both Houses that will be formed this week, we seem to be moving towards a timetable for Lords reform that suggests that the new-look Chamber could be in place at the time of the next general election, if not before. That would mean a Bill passing through this House in 2003 or 2004. If it is decided that the second Chamber should have a directly elected element of as much as 50 per cent., and assuming that the Lords Chamber is around the same size as this one, about 300 newly elected Members of the Lords would take their seats following an election in 2005 or 2006. That timetable would run virtually concurrently with the roll-out of regional assemblies, where regions chose to have them. It could therefore reasonably be assumed that the two processes would influence each other—positively or negatively, depending on how they are carried out.

It is important to bear in mind the fact that the level of representation on putative regional assemblies, if they were to operate at about the same level as the Greater London Assembly, could be lower than the level that each region would provide to a reformed House of Lords through elected Members under a 50 per cent. election plan. It can be predicted that some political and media interests will campaign for a no vote, presenting new political jobs as a jamboree for the regional political classes. In view of that, there is a fairly strong risk that the creation of 30 or 40 new political jobs in each region will have a seriously detrimental effect on the results of referendums on regional assemblies that would probably be taking place at around the same time.

It is worth considering two points in more detail. It is likely that payments for new, elected Members of the Lords will be lower than for full-time Members

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of Parliament. The Government and the Public Administration Committee have presented arguments on that. However reimbursement, remuneration or payment is structured, it will probably be more attractive than that for a councillor. It may even compete with being a member of a regional assembly when and if assemblies are established in different parts of the country.

The Public Administration Committee suggested that, in view of greater journey times and distances and the possible higher administrative costs of travelling from Scotland or the north-east, the total package for a Scottish Member of the second Chamber could exceed £30,000. I believe that the figure would be more, given that flights would cost approximately £10,000 for a weekly attender.

It will be hard to argue that the new appointments are meaningful and valuable but to pay a daily rate that is substantially lower than that of non-departmental public bodies. That problem must be solved. The Senior Salaries Review Body would probably recommend a sum that approached that offered by non-departmental public bodies: perhaps £200 or £300 a day. Perhaps the figure would be half that, but it would still be significant.

Regardless of the rate and the costs of the current system, the fact that £1 million per annum or more has been committed to a new layer of regional party politicians would make winning a referendum on a new regional assembly harder work than it would otherwise be. That is possibly a fatal blow to assemblies, for which polling suggests a tight result. The problem would be exacerbated by the almost inevitable compensation that would have to be paid to current life peers who would have to leave the Chamber to keep the numbers manageable under a plan to elect 50 per cent. or more. I presume that the public would prefer that money to be spent on public services such as health and education.

I have not heard the second point that I want to stress in a debate on reforming the Lords until now. It is the function of the other Chamber. I have read the Government's comments and those of the Public Administration Committee. I have also read previous debates. Perhaps hon. Members will make similar comments later about clearly defining powers. One could say that the other Chamber is primarily for revision and scrutiny. That is all very well, but unintended and unforeseen consequences may ensue from immediately having a substantially elected element of new Members of another Chamber. I want to illustrate that through my experience and that of my colleagues in the context of otherwise successful devolution in Scotland.

Some list Members of the Scottish Parliament have taken on roles as shadow constituency MSPs in ways that people did not foresee when the Scotland Act 1998 was passed. I suspect that some of the same practices would operate in a Lords or a senate, or whatever the second Chamber happened to be called. I believe that many practices would be imported. Let me refer to a couple that happen regularly in Scotland and perhaps in Wales and Northern Ireland.

In Scotland, a d'Hondt system was used to provide proportionality in the legislature. Hon. Members were elected through that system to provide fairness when passing legislation; they did not have a constituency role. Indeed, many who were elected as list Members stood unsuccessfully for constituencies. In almost all cases, list MSPs have set themselves up as shadow constituency

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MSPs. When I conduct my weekly surgeries, I see posters for "your local MSP". They do not refer to the local constituency MSP, but the list MSP who is working the patch. Indeed, Opposition list Members divide up each region according to their own party's political interests and work that patch. I suspect that that activity was not foreseen, and it could easily be replicated by a substantially elected membership of the other place, if such there were to be.

People sometimes say to me that there would be a limit to what people could do if they were elected to the other Chamber, because they would have a clearly delineated function, and if they stepped outside that they would be slapped down. In fact, it is not as simple as that. For example, I have a large Child Support Agency office in my constituency, which looks after the north and Scotland. I recently paid a visit to the parliamentary questions section of the agency, and was told that quite a high proportion of the work that is referred to it came from MPs. I said, "Surely it is all referred by MPs, as it is a reserved area", but I discovered that that is not the case. MSPs can put in cases to the CSA and are treated in the same way as MPs. I presume that there is a good reason for that, and that it has something to do with the fact that a CSA case will often dovetail with issues relating to social services, housing and so on. That might well be the reason for that working practice having developed, but the fact remains that that movement across a boundary was not foreseen.

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