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Baroness Nicol moved Amendment No. 27:


Page 74, leave out lines 41 to 44 and insert—
(""( ) Regulations made by the Secretary of State shall provide for a public gas transporter to pay compensation for any loss sustained by any person as a consequence of the exercise of those powers.").

The noble Baroness said: My Lords, I understand that the marshalling of the amendments was incorrect and that Amendment No. 27 should have come before Amendment No. 26. First, I should very much like to thank the Minister for the meeting he had yesterday with one or two of the people concerned about the Bill. It was very useful and helped to move things forward.

I should like to thank the Minister also for Amendment No. 26 which removes the uncertainty in regard to "if" the regulations were produced, about which so many noble Lords were concerned at previous stages of the Bill. It makes it clear also that the Government accept the principle of payment of compensation. But one or two uncertainties remain about what the regulations will contain; for example, will there be a ceiling on the size of business which may claim compensation? The Minister will recall that we had the much discussed British Gas amendment of a £500,000 ceiling. What consultation will the Minister have before drafting the regulations?

Those questions are important, and I should like to have answers to them before I decide what to do with my amendment, because my position remains that compensation should be paid to all businesses which can prove that they have suffered loss, regardless of their size. I repeat, why should they have to suffer at the hands of another private business? There is no greater inducement to efficient working than having to pay for inefficiencies. The gas transporters are no exception.

The other amendment in the group (my Amendment No. 28) has been pre-empted by the Minister's new amendment (Amendment No. 29). The part of the clause which gave the gas transporters right of veto over future legislation was unacceptable to many of us in parliamentary terms as well as in other ways, and would have opened the way for similar demands from other organisations in other legislation. The new amendment leaves the power where it belongs. I am pleased that the offending words have been deleted and so I shall not be moving my Amendment No. 28. I await the Minister's answers on how the regulations are to be arrived at. I beg to move.

Lord Stanley of Alderley: My Lords, I supported the noble Baroness on Report, and I do so again today. Put on the face of the Bill, her amendments would deal with the problem rather more effectively than the

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Government's method. I do not wish to sound churlish for I appreciate the care and great thought that my noble and learned friend has put into listening to the problem of compensation, and the amendments that he has brought forward. In my opinion they have two main snags which the noble Baroness partly pointed out. The first and most important is that the Government intend to act by regulation, and we do not know what will go in and what will not go in those regulations, particularly if there is any limit.

The Government promised consultation before the regulations come before Parliament, and I welcome that. However, consultation means very little if the officials happen to behave like Sir Humphrey, as I am painfully aware today over the Charity Commissioners apparent inflexibility over SORP. Moreover, when the consultation has taken place and the regulations are laid before Parliament it can do nothing to alter them. I know that that point worries all noble Lords.

The second matter that worried me greatly was sub-paragraph (5), which is now dealt with by my noble and learned friend's new amendment. In the train today I composed a thoroughly sarcastic and vitriolic attack on my noble and learned friend. However, on arriving here I discovered that he had removed the offending sentence, for which I thank him greatly. My temper will now have to find another target.

I thank my noble and learned friend and the noble Baroness for reaching such a good compromise which will be welcomed, I know, by many small businesses. I hope that they will be gracious enough to thank both of them, as I do now.

Lord Skelmersdale: My Lords, having supported the noble Baroness every inch of the way from the first day of Committee, it would be unfortunate if, shall we say, the hint of iron in her speech caused me to break company and to break ranks at the last minute. Since taking over the Bill, which is never easy—and I speak from experience—my noble and learned friend has bent over backwards to ensure that he and his officials are as accommodating as possible to your Lordships' views and wishes. I congratulate my noble friend Lord Stanley on having persuaded them to remove what I described last Wednesday as the rogue "if" at the beginning of this part of the Bill and for removing the provision which led to a certain amount of angst around the Chamber. It was, as my noble friend pointed out, the need to have the consent of all public gas transporters before the regulations were changed.

Bearing in mind that my understanding throughout was that the Government were thinking closely along the lines of the letter sent by the chief executive of British Gas in January, referred to in Committee in another place, and taking account too of the fact that the current non-statutory arrangement catches 90 per cent. of VAT registered businesses, which by definition means 100 per cent. of non-VAT registered businesses, perhaps I may gently suggest to the noble Baroness that seven-eighths of a loaf is considerably better than none.

Lord Peston: My Lords, we have made considerable progress and everyone involved is to be congratulated. Perhaps I may say to the noble Lord, Lord Stanley, that

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no material that one prepares is ever wasted; it can always be recycled on other occasions. I look forward to hearing the vitriolic attack which perhaps he will direct at me some day.

I believe that my noble friend got the main point right to start with; that as regards private enterprises imposing costs on other private enterprises and damaging their business, there ought to be grounds for compensation. That is a fundamental point and broadly we have established that and agreed it. It is now a matter of how we achieve it.

The noble Lord, Lord Skelmersdale, is right to say that we have moved seven-eighths of the way towards our destination. I am not sure whether it is a constitutional point or a point of honour but since the regulations are in response to your Lordships' demands it seems clear that the Government will introduce them corresponding to what we have discussed. It would be appalling if the Government, having introduced the regulations in response to what we have said, formulated them in a way which did not bite on the issues we have put forward. Perhaps holding government in higher esteem than one or two other noble Lords, I am willing to believe for the moment that the regulations we get will be the regulations we want. However, we must wait for that.

We have moved forward and a concession has been made. Indeed, it is more than a concession; a considerable change has been made to the Bill which will affect small businesses in particular but other businesses too. I am most supportive of how far we are going now.

4.45 p.m.

Lord Fraser of Carmyllie: My Lords, I am delighted that the vitriol which my noble friend conjured up on the train today will not be displayed before your Lordships tonight. I am grateful for the observations that have been offered from both sides of the House for the changes that we have made. Perhaps I may reiterate that we have agreed not to make a general point that in each and every case there is a right to compensation when one user of the street acting lawfully causes delay or disruption to another. However, we recognise that a special exception is to be made for prolonged gas repairs affecting small businesses. I am grateful to the noble Baroness for drawing together at such short notice a number of people with whom the matter could be discussed.

Our present view is that an appropriate threshold for defining a small business would be a turnover of £500,000 a year, linked—and I stress this—to the retail prices index. We understand that such a figure covers the vast majority of small businesses. However, I confirm to the noble Baroness that we will be consulting appropriate national associations before making the regulations. Obviously, we will be prepared to look at any evidence as to whether a slightly different threshold ought to be used so as to cover the vast majority. The noble Baroness will appreciate that time is such that we do not have the opportunity for a widespread formal consultation but we shall certainly discuss the

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regulations informally. We have in mind a period of about three weeks starting in November and we will consider any evidence submitted as to whether the turnover limit is set at the right level to define a small business.

I turn to my Amendment No. 26. In the course of introducing our proposals on Report I gave a commitment that the Government would make the regulations envisaged by the appointed day when the principal provisions of the Bill will come into force. However, in response to my noble friend Lord Skelmersdale I also said that I would look to see whether we could reinforce that commitment by making it a statutory duty, rather than a discretion, for the Secretary of State to make the regulations. The amendment achieves that result.

The other amendment standing in my name on the Marshalled List was drafted in response to the continuing concern about sub-paragraph (5), expressed again by the noble Baroness and by my noble friend Lord Stanley. Their concern focused on what was seen as a veto being given to public gas transporters. The noble Baroness will appreciate that that provision will be removed by my proposed amendment.

I hope that we have achieved a satisfactory result and that we can leave this issue behind us at the last stage of the Bill.


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