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Lord Palmer: I am sure that many noble Lords are delighted that the noble Earl has been able to accept Amendment No. 6. I am most grateful to him, as I am sure are many Members of the Committee. I commend the amendment.

On Question, amendment agreed to.

[Amendment No. 7 not moved.]

Clause 3 agreed to.

Clauses 4 and 5 agreed to.

Clause 6 [Interpretation]:

[Amendment No. 8 not moved.]

Clause 6 agreed to.

Remaining clause agreed to.

House resumed: Bill reported with an amendment.

Municipal Crematoria: Privatisation

5.24 p.m.

Lord Young of Dartington rose to move To resolve, That this House calls upon Her Majesty's Government to revoke the Local Authorities (Capital Finance and Approved Investments) (Amendment No. 2) Regulations 1995 (S.I. 1995/1982), and to replace them with regulations which do not provide for the privatisation of municipal crematoria.

The noble Lord said: My Lords, the order in question is contained in the regulations which were laid before Parliament on 2nd August of this year during the holiday period. Those regulations offered an inducement to local authorities to sell their crematoria into private ownership.

This is the first occasion where there has been a public debate on what I consider to be an important matter of public concern. In opening the debate, perhaps I may say that a measure of support has been given to the position that I take by the Consumers' Association, the National Consumer Council, the Society for Independent Funeral Directors and the National Funeral College, of which I was the founder chairman. They have all issued press releases or have written to the Secretary of State for the Environment.

Why does this issue matter? In order to answer that question, I have to go a little into the history of the industry. In this context, it can appropriately be called that, especially during the past year. The most radical reorganisation of the funeral industry has already taken place and, unless a stop is put to that process, it looks as though it will gather pace in the years to come.

What used to be (apart from the Co-op) a series of local funeral businesses, has been invaded by big business and big money. Since August 1994 a large American company called Service Corporation International has suddenly burst on the British scene. It is big business as is shown by the fact (if one needed more evidence) that the banker for the SCI is

30 Oct 1995 : Column 1311

J.P. Morgan, the legendary Wall Street banking giant. The kind of money involved was demonstrated recently when the same company, which is large in Australia, too, bought up the largest funeral undertaking in France for a reputed 422 million dollars. In Britain, amalgamations were proceeding apace before SCI arrived. The Great Southern Group and Plantsbrook were themselves two amalgamations which covered a large number of local funeral directors. The listing of local funeral directors owned already by SCI, but all keeping their own family name, fills 14 pages of the Monopolies and Mergers Commission report published a few months ago on the mergers of Plantsbrook and SCI. The listing covered about 700 outlets of a large number of funeral directors, mainly in London and southern England, but represented also in other parts of the country. Altogether, the funeral directors which are owned by the SCI company already control some 15 per cent. of the funeral market in the country. SCI, in addition to that, already owns 15 crematoria in the country.

The danger, as I see it, is that SCI will take advantage of the new government regulations—about which I shall say more in a moment—in order to create a further series of local monopolies and raise prices against consumers. The poorest consumers are the ones who will suffer the most if that happens. They are the ones who find the burden of the expenditure on funerals hardest to bear at the moment. It all matters a great deal because bereaved people at the time of the death are peculiarly vulnerable to exploitation and to being guided by funeral directors and others to a course of action which may well not be in their best interest.

I can say that, fortunately, the danger was recognised by the Government in the shape of the Department of Trade and Industry, when it asked the Monopolies Commission to report on the local monopolies in the hands of SCI. The report was published in May this year. The Monopolies Commission amply confirmed the Government's view that there is a very present danger in localities where SCI's share of the market ranges from 29 per cent., as it does in Eastbourne, to 51 per cent., as it does in Battersea. The Monopolies Commission stated in its summary that:

    "SCI may be expected generally to raise prices excessively, i.e. by more than would be possible in a competitive market, in the ten localities, to the detriment of consumers in those localities ... SCI's failure to disclose to consumers the ownership of its branches will add significantly to the inability of consumers in the determined area to make informed decisions ... Choice of funeral director will be materially reduced in the ten localities, to the detriment of consumers in those localities".

The Monopolies Commission pointed out that, since the ownership of many funeral directors by SCI is hidden by the retention of the old family names, it can quite often be the case that people who are seeking an alternative quote for a funeral go to another firm thinking it really is a competitor, without knowing that it is in fact in the ownership of the same funeral director as they went to in the first place.

In the Monopolies Commission report particular disquiet was expressed about the power the SCI would have to take advantage of vertical monopolies—it already has in some places—and would have on a larger

30 Oct 1995 : Column 1312

scale when it owns both more funeral director businesses and local crematoria and can channel very many funerals carried out by its own funeral directors to its own crematoria.

The DTI accepted the recommendations of the Monopolies Commission, and on 25th May Jonathan Evans, the Minister for Competition and Consumer Affairs at the DTI, said of the acquisition by SCI of Great Southern and Plantsbrook:

    "I accept the MMC's findings that the merger may be expected to operate against the public interest in respect of the supply of both funeral directors and cremation services".

The DTI therefore asked the Director General of Fair Trading to seek undertakings from the SCI that it would reduce its market share by divesting itself of some of its funeral directors and also that it would not operate a two-tier pricing system for its crematoria which favoured its own funeral directors. SCI was asked to give those undertakings by 25th August or be forced to comply with the DTI requirements. But the SCI, far from submitting to the DTI, has brought a judicial review case against the Secretary of State and the Monopolies Commission and is seeking to be relieved of the requirements of the DTI. In this, the SCI has shown its powerful muscle and that it will not lie down quietly.

However, at the same time as the SCI is in dispute with one government department, it is being given a mighty fillip by another government department. The Department of the Environment has made this handsome offer to every local authority with crematoria. It has said that from 1st January next year until 30th June in the following year local authorities that sell their crematoria will be able to keep 90 per cent. of the proceeds instead of the usual 50 per cent., the rest going to redemption of debt. The Department of the Environment has, from one point of view, chosen a good moment because it is also requiring local authorities to update their crematoria in order to comply with new environmental standards but has not offered even a hint of financial support from itself to local authorities.

So the paradoxical situation that the Government have got themselves into is that the DoE is persuading local authorities to sell—and that means largely selling to the SCI, which is the only large bidder likely to be in the market. But the more it succeeds with the Department of the Environment behind it, the more worried the DTI, the Monopolies Commission and the Office of Fair Trading will presumably become. Surely, at least until the outcome of the judicial review is known and it is clear that the SCI is going in future to avoid creating local monopolies, the Government should get their act together and withdraw the order in so far as it affects crematoria. The Government would not then speak with two voices. I hope that the Minister will today be able to reassure us that they will not continue to do so.

I have been speaking about local monopolies as they could affect consumers, but losing the crematoria could be bad for local authorities too. Crematoria are ordinarily profitable and the proceeds from them can be used to subsidise or cover some of the costs of cemeteries which are not profitable. But, as a result, the option can be kept open for the 30 per cent. or so of

30 Oct 1995 : Column 1313

people who prefer burial to cremation. Give up crematoria to the profit-making sector and more cemeteries could become wastelands instead of useful public spaces. The Department of the Environment has been very keen on preserving and creating good, useful public spaces; in some cases grants are forthcoming for the purpose. But in this case it is waging a battle against itself.

But there is a more important issue than that. The SCI is a commercial company with a vast pre-paid funeral business in the United States and Australia and a very large and growing one in the United Kingdom as well. It is a very profitable company. As it gains more control, commercialisation will extend and all the money it makes out of funeral merchandise, as the company calls it, and the add-ons of memorial books, ashes, caskets and other forms of memorialisation all over Britain will go to augment the profits of the American shareholders.

Even more important than that is that the fundamental religious significance of funerals could be further dimmed by a sickening array of money-making devices and more and more use made of chapels on funeral directors' premises in order to speed up the through-put of crematoria.

I hope, in conclusion, that the Minister will realise that what appears a simple matter is not simple at all and that he will at least give some time for further consideration and debate before the order comes into force as it affects crematoria. I beg to move.

Moved, To resolve, That this House calls upon Her Majesty's Government to revoke the Local Authorities (Capital Finance and Approved Investments) (Amendment No. 2) Regulations 1995 (S.I. 1995/1982), and to replace them with regulations which do not provide for the privatisation of municipal crematoria.—(Lord Young of Dartington.)

5.40 p.m.

Baroness Thomas of Walliswood: My Lords, once again, I rise to my feet in this Chamber as a total novice in a subject. I suppose that it will stop happening, but it does not seem to have stopped happening yet. Nevertheless, as the noble Lord, Lord Young of Dartington, told us, we received a large number of briefing papers, and I have been able to talk to one or two people who were very helpful. The noble Lord has done us a service in drawing this matter to our attention. In one way or another, it affects all of us.

There are three salient points to make. First, the regulations to which the noble Lord referred provided a financial incentive in the form of a set-aside holiday for the sale of various sorts of locally owned property, including crematoria. The press release issued by the Government when those orders were published made it perfectly clear that the purpose was to enable local authorities to transfer their assets in this field into the private sector. The second fact affecting local authority attitudes is the cost of bringing the conditions in crematoria up to a standard that enables them to meet new EC regulations. The anticipated cost is approximately, on average, £400,000. Thirdly, although most crematoria are currently in municipal hands there is severe reason to fear that their sale could, as the noble Lord told us, result in a most undesirable monopoly in what might be called the death business.

That monopoly would be of a peculiarly dangerous sort. It would affect not merely the ownership of crematoria but the ownership of the businesses that advise bereaved people at their most vulnerable moment regarding what sort of service they should choose, where that service can best be achieved and so on. Those of us who know anything about the American way of death know that there are reasons to fear the import of the American approach into what has been a service run purely as a service to people. It has had certain values in terms of access, reasonable prices and so on.

The only body that wrote to me expressing a view that we should not do as the noble Lord, Lord Young, suggests and reconsider the regulations was the Association of Metropolitan Authorities. I have a certain sympathy with the point of view expressed. The association does not wish the regulations to be revoked: understandably enough in the current financial circumstances in which the whole of local government operates, it welcomes the flexibility that the set-aside holiday gives. Obviously, the authorities also fear the need to spend £400,000 of capital per crematorium on improvement. It would be very difficult for them to manage such an expenditure during a period when not only revenue expenditure but capital expenditure is under very severe control.

However, I feel that the approach of the metropolitan authorities to this matter is not quite the best one. As I say, I understand their point of view very well given my own background, but the flexibility that they seek could be far better granted to local authorities by allowing them in general terms to spend more of their capital gains for the benefit of their local populations rather than putting it aside against, in some cases, almost an imaginary amount for debt. Therefore, although I have a certain sympathy with my fellow members of local authorities, it seems to me that public policy is another matter altogether. There are very good reasons to suppose that traditionally managed municipal crematoria may well serve bereaved people, who are very vulnerable, better than would a very competitive private sector anxious to sell them so-called add-ons in addition to the basic service.

I therefore have a number of questions for the Government. Do the Government still recognise, as they did in response to the report of the Monopolies and Mergers Commission referred to by the noble Lord, Lord Young (I shall not repeat all the points made by the noble Lord; the House does not want to hear them twice) that there is a serious danger of a growing monopoly in the funeral business? That is not just because a large number of crematoria could be owned by single, or very few, companies, but also because those companies may—and in one case certainly will—be owners of funeral directors' companies. That question was given additional point by a fact that I did not know; namely, that the American company involved is going to judicial review in respect of the Monopolies and Mergers Commission decision.

If the Government feel that such a danger exists, how do they propose that it is to be avoided? Do the Government further recognise that there is a legitimate fear that vulnerable people will be over-burdened with expense for funerals? That is already a major worry for large numbers of people as their own lifetime nears its end or the lifetime of their parents comes to an end. Do the Government recognise a possible danger that people may be, as it were, bludgeoned, persuaded, into spending far more than they need do for what is already an extremely expensive event?

In the press release to which I referred, the Department of the Environment stated:

    "Before deciding on any sale, authorities can be expected to satisfy themselves of continuing quality of service for local residents and competitive pricing. Authorities can also be expected to require that, prior to any transfer, the private owner agrees to operate within the standards set down by the Federation of British Cremation Authorities".

How does the Minister anticipate that local authorities can ensure that those things happen once they have transferred their municipal crematoria to a private owner?

My last question refers again to a point made by the noble Lord, Lord Young. The noble Lord suggested not so much that the order be revoked but that the Government might be able to reconsider that part of the order that refers specifically to crematoria. Is that a feasible possibility, and would the Government be willing to do that?

5.49 p.m.

Earl Grey: My Lords, first, I must declare a financial interest. I am chairman of a crematoria company. For information, it is not SCI. I am also honorary president of the Cremation Society of Great Britain.

The views that I hold are not necessarily those of my party. In view of what I just said, it will be of no surprise to the House that I have no objections to crematoria being owned or operated either on behalf of a municipal authority or by the private sector. In fact, the first crematorium in this country was operated by a private company. Over the years, in the vast majority of cases the private sector has set a high standard which has been an example to local authorities.

As the noble Lord, Lord Young, said, the main concerns would be if there were monopoly ownership of crematoria in any given area; and—which is just as important—if the crematoria were owned by the same company that had a monopoly of funeral directors in the vicinity. It is a problem that could arise in the private sector. It has been widely reported and is of great interest to those in the industry.

The effect that SCI has had in this country is a source of great concern to all involved in the industry. It is not only of concern to local authorities. Certainly, there has been an effect on private companies throughout the country. Not only my company but the majority of private, individual companies, have been watching the progress of SCI extremely carefully and closely. I recognise the danger that freedom of choice and quality could be affected. It is a situation that must be monitored and I favour that course. I welcome the findings of the Monopolies and Mergers Commission mentioned by the noble lord, Lord Young, and in principle I and my professional society agree with much of what he has just said.

However, it must be borne in mind that a number of local authorities welcome private companies and are quite happy for them to be involved in their activities, not only taking over and acquiring local authority crematoria but also managing them on their behalf. That could be a way forward also.

I do not agree that what is being asked by the noble Lord, Lord Young, is the right way to go about the problem. Surely it must be the decision of the local authorities themselves. I believe that the private and public sectors can and do work together well for the benefit of the public.

Finally, the Cremation Society of Great Britain is very sensitive to the problem and is very concerned over any likely monopoly situation. That certainly is not what members of the society want. In fact it is a situation that we strongly oppose.

5.53 p.m.

Lord Williams of Elvel: My Lords, the House will be grateful to my noble friend Lord Young of Dartington for raising this issue. It is a problem which may seem unimportant in the general context of legislation, but it has great consequence for many people at an important part of their lives.

We have no objection to those parts of the regulations which deal with matters other than crematoria. If a local authority wishes to sell off car parks or land of which the whole, in terms of the regulation, consists of car parks and 90 per cent. of those proceeds go to the local authority, that is welcome. We have no particular objection to the idea that sales of land of any kind should be applied for local authority general purposes rather than reduction of debt. The problem arises only—this is a general problem—because the Government have been so absurd in their treatment of local authority capital expenditure and receipts that one has to resort to such rather ridiculous formulations in order to help local authorities. The correct solution would be to allow local authorities much more leniency in their financial considerations.

I can honestly agree with what my noble friend Lord Young said with regard to crematoria. There are some general principles lying behind what is happening at the moment. As the noble Lord, Lord Lucas, will know—perhaps I may have his attention for a moment—the provision of crematoria was not sought by local authority associations. So far as I can see, it was done by the Government at a rather late stage. According to my information, in the United Kingdom as a whole there are 229 crematoria run by local authorities and 36 which are privately owned. As my noble friend in another forum has pointed out, there is no effective regulation of the service. The service has a self-regulatory code—we all know what self-regulatory codes mean—run by the Federation of British Cremation Authorities. The United States firm which my noble friend and other noble Lords mentioned is a member of that federation. In the event of the failure of self-regulation, the only recourse is for the Government to appoint inspectors to see what has happened. There is no authority for the Government to step in and say, "We will run this particular crematorium, because things have not happened in the way in which the code would have authorised."

The questions that arise have been put very succinctly and indeed eloquently by my noble friend Lord Young. Will there be a monopoly? Will there be a derogation from the general principle that there should not be monopolies in public or private services? What is the protection? If there is to be a monopoly, will there be some form of government regulation—not a self-regulatory code but some form of government regulation—to ensure that the company which may enjoy that monopoly observes proper principles? I ask that question not only because of the argument that has been advanced so far by noble Lords about the DTI, the report of the Monopolies and Mergers Commission, the judicial review and so on, but because the company in question, as I understand it, wishes to use the crematoria that they wish to buy—some have already been bought—as a sales point for what are called add-on services.

Perhaps I may quote what is reported in the Funeral Service Journal as coming from one of the gentlemen who heads the UK operations of SCI:

    "We will be promoting 'add-ons' and 'service plus' features and offering a wider choice, particularly of memorial books, cards and other forms of memorialisation. Ashes caskets is one item we feel are not as well promoted as they could be".

If that is the motivation of the company which is trying to take over a number of crematoria, and possibly all the crematoria in the light of what the government regulations put forward, I believe it to be fundamentally undesirable.

As the noble Baroness, Lady Thomas, said, people in such a situation are at their most vulnerable. They have lost someone whom they have loved. Perhaps I may speak for the Christian point of view for a moment, since I am a practising Christian. I believe that it is a moment when people should be allowed to rest comfortable in their grief and not be pursued by people who want to sell them all kinds of cards, ashes caskets, and so on. I am sad in a way that none of the right reverend Prelates has come forward to support my noble friend Lord Young's Motion. It is important for those of us who profess a belief in Christianity.

In summary, I believe that my noble friend Lord Young has made a very forceful point. Special regulations must be necessary if there is to be any kind of monopoly on this business. If we are to preserve a civilised society, the regulations must prohibit the types of add-ons that my quotation indicated. I believe profoundly that these services should be publicly owned; that they should be part of the Christian burial service; that they should be part of the bereavement process through which families go. I do not see how that is met by what is proposed by the Government this evening.

6 p.m.

Lord Lucas: My Lords, we share most of the anxieties expressed by noble Lords this evening, particularly those in relation to the cost of dying. The noble Lord, Lord Young, will remember that the municipal crematoria came into existence because private graveyards were charging so much and the poor wanted somewhere they could be buried with dignity. Nonetheless, your Lordships will not be surprised that we oppose the Motion of the noble Lord, Lord Young. Despite his moving speech, I am surprised that he too is not opposed to it.

The private sector has an excellent and longstanding record in the funeral business. Undertakers, florists, coffin makers and car hire organisations are all private and all, in my experience, provide a sensitive and efficient service. The Churches also do an excellent job. In relation to local authorities, I really appreciated the last two cremations I attended. They seemed to be much more responsive to the needs of the bereaved than was the case 20 years ago.

These days both public and private sectors, generally speaking, do a good job. I include in that comment the 27 crematoria that, so far as I am informed, are privately run. Modern local authorities are not obsessed by who owns the crematorium; they are interested in the service that it provides and in how well it meets the local needs and circumstances. The watchword these days is "partnership"; that is, partnership between local authorities and private enterprise to provide efficiently and inventively what local people want and need. That was very much what the noble Earl, Lord Grey, suggested may lie ahead of us.

The regulations opposed by the noble Lord, Lord Young of Dartington, involve the enabling of partnership. They give the local authority, as the current owner of the crematorium, much more room for manoeuvre. Each local authority may choose its partner or choose none. The local authority sets the terms of the deal; it weighs the financial consequences and the consequences for its electors. Whether to spend on updating the crematorium or on something else is a matter for the local authority. Sale, partnership, or, as I suspect many will choose, retention is for them to decide. It is clear from what has been said that both parties opposite would give local authorities that same freedom.

The noble Lord, Lord Young, mentioned SCI. He said that the only people actively interested in purchasing crematoria are SCI. I can give him some comfort that there are other people out there who have approached us on the subject. He said various other things too about SCI. The Monopolies and Mergers Commission investigated SCI and published a report in May this year. We supported that report and published our proposals to take action on it. However, we have been stayed by a legal challenge from SCI.

We understand that the current position is that SCI has agreed in principle to sign an interim undertaking pending the outcome of judicial review. Any further acquisitions of crematoria or funeral directors by SCI will be subject to review by the Office of Fair Trading and referred to the MMC where necessary. I understand that the Office of Fair Trading asked the noble Lord, Lord Young, to alert them to any cases which cause him anxiety in the future.

I cannot say much more on the subject of SCI, given the pending proceedings, except that it is clear that we take our role of safeguarding the public interest seriously and responsibly. Perhaps I can give some further comfort to the noble Baroness, Lady Thomas of Walliswood, as to the circumstances in which crematoria and their customers find themselves.

On average, cremation accounts for around 15 per cent. of the cost of a funeral and it appears that on average private crematoria charge around 16 per cent. more than municipal ones. That is in part explained by higher levels of investment in the private crematoria. We are concerned that local monopolies should not emerge and will support the Monopolies and Mergers Commission in that endeavour. The regulators are fully alert to the potential dangers of vertical ownership links between funeral directors and crematoria and that is one of the principal reasons for the investigation of SCI.

Before transferring any crematorium to the private sector, we hope that a local authority will satisfy itself of the continuing quality of the service and value for money. In particular, we expect them to satisfy themselves that there is sufficient competition from other crematoria and burial grounds nearby. In England 25 per cent. of crematoria have an alternative within five miles and 75 per cent. have an alternative within 15 miles. It is understood that the last transfer by a council to the private sector, in 1993, included safeguards including a bar on discriminatory charging in favour of specific funeral directors. Local authorities should exercise their judgment carefully and not sell when in doubt.

The Monopolies and Mergers Commission report brings me, in a roundabout way, back to where I started; back to my surprise that the noble Lord, Lord Young, should wish to pursue his Motion. The Monopolies and Mergers Commission report goes into great detail about the market, or lack of it, in funeral services. It explains that the main defect is not a lack of choice, which is considerable, but a lack of information to enable customers to choose; a lack of advice available to customers at a time when few people feel like shopping around. That surely is a case for the Consumers Association, and when I think of the Consumers Association, I think of the noble Lord, Lord Young.

I am surprised that someone so intimately associated with such a great movement for individual empowerment and choice, should wish to restrict choice in a way in which the Motion seeks to do. I am even more surprised when I think of the noble Lord's advocacy of the Natural Death Centre and of his championship of "choice to the last". I hope that he will not surprise me again by pressing the Motion to a vote.

6.8 p.m.

Lord Young of Dartington: My Lords, I apologise for my voice, which is threatening to give out. That may not be due so much to the cold, as to the distress caused by the subject we are discussing and possibly the further distress caused by the Minister's reply to this debate.

Before I strain my voice further on that last count, I thank all those who have taken part in the discussion. I am grateful to the noble Baroness, Lady Thomas, because she reminded us that we are faced with something that the Minister did not face up to; that is, what has become known as the, "American way of death". If in 10 or 15 years' time the American way of death has taken a hold in this country, as I fear it will from the way things are going, then those who go into the detail of the history of what is happening in this area may well be as distressed as I am by the Minister's speech.

Because the Department of the Environment is behaving in this way and is offering a bribe to local authorities to transfer their crematoria to private ownership, the SCI, as shown by its various newsletters and by the pronouncements from its directors, is cockahoop. It means to take full advantage of the window of opportunity that the Government have provided between next January and the time 18 months after that when the concession they have offered will be withdrawn. We hope that other things will also have happened, at least towards the end of that 18 month period, which might lead to a change of direction on the part of government policy.

I was not quite sure whether the noble Earl, Lord Grey, whose intervention I welcomed, was for what I was saying or against it. It seemed that he was both. I am happy that he should be prepared, at least in part, to support what I was saying and support the findings of the Monopolies and Mergers Commission.

Earl Grey: My Lords, I said that I agreed with many of the noble Lord's points but that I would not support him if he went through the Division Lobby. I think that what he has suggested is not the correct way of tackling this problem.

Lord Young of Dartington: My Lords, I am grateful for that clarification. I shall certainly be very sorry if the noble Earl is not able, after I have spoken, to follow me into the Division Lobby.

I particularly welcome the speech of the noble Lord, Lord Williams. Many of the points he made struck me most favourably; above all, what he said about the bereaved and how they are in a state and should not be pestered by salesmen of the kind SCI employs, and has employed, to such good effect in this country and in the United States, Australia and France.

I turn to the Minister's speech. I could not follow the connection between his opening remarks, which gave me some cause for rejoicing, and what he said after that. He pointed out that the municipal crematoria came into existence partly because poor people and others were being so done down by private industry, but he did not seem to complete the circle and accept that if the changes the Department of the Environment is promoting take effect on a large scale poor people and others could again be subject to the mercies of private enterprise and without any control being attached to what it does. The Minister said that the SCI has given interim undertakings before the outcome of the judicial review is known. I understand that the interim undertakings are only to assure the Government and perhaps the court that there will be no change in ownership of the funeral directors that have been listed by the Monopolies and Mergers Commission in the period before the outcome of the judicial review is known. If those are all the undertakings that have been given, then those are slight things indeed. We shall have to await the outcome of the judicial review.

The Minister said that he hoped that local authorities would satisfy themselves that they were doing right when they sold their crematoria to private companies—the SCI or perhaps others. We all hope that. Fortunately, there is more to it than that. It was not quite stated by the Minister, as it might have been, that the Office of Fair Trading is under a duty to keep a very close eye on the sales of crematoria by local authorities. If it feels that a monopoly situation is being created, it has the good cause and even a duty to intervene. That means that the Office of Fair Trading should look at every acquisition of a local authority crematorium that occurs, if only it can get good information in advance about it. This means that any local authority that goes so far as to consider selling to SCI will know that its decision may be called into question by the Office of Fair Trading and that it may have to retreat. The more that is known by local authorities, perhaps the fewer of them will be prepared to sell. Therefore, we do have some protection in the Office of Fair Trading and the powers that have been given to it.

In conclusion, we are at a very important point in the history of cremation and burial and, wider than that, in the way in which we treat the dead. If the message does not go directly out of this House to local authorities to be very wary and cautious about selling an important public asset to a private business, I only hope that that will happen in other ways and that perhaps one day the Minister might join those who I think have a better sense of what is at stake here and be prepared also to warn local authorities of the dire step they may be taking. They should not sell out, under the influence of a bribe from the Government, on an important public asset which touches people at the most difficult time of their lives. This subject should be treated with the greatest respect and dignity.

Unfortunately, I do not think that there is a case, despite the possibility that I may have persuaded the noble Earl, Lord Grey, to follow me, for pressing this Motion to a vote. I am only glad that there has been such support for the Motion. I shall certainly not cease my labours to see right done, as I think it should be. I hope that there will be others here who might join me, if not in this House then outside it. I beg leave to withdraw my Motion.

Motion, by leave, withdrawn.

Royal Naval College, Greenwich

6.18 p.m.

Baroness Hamwee rose to ask Her Majesty's Government on what basis they have decided to sell the Royal Naval College at Greenwich on the open market, and whether they will reconsider their decision.

The noble Baroness said: My Lords, "We are instructed to seek offers and expressions of interest". That is familiar estate agents' language. We are accustomed to agents' hyperbole—references to "unique opportunities" are too often devalued. But in the case of the Royal Naval College at Greenwich the description is entirely accurate.

If there were a designation of buildings as Grade I triple star, these buildings would qualify, both on historical and on architectural grounds. This is where King Henry VIII was born; and Queen Elizabeth I. This is where Drake was knighted. This is where Charles II began his great palace, never completed "for lack of funding". These are the great buildings masterplanned by Sir Christopher Wren; colonnaded, domed, symmetrical, magnificent; the subject of a famous painting by Canaletto, a painting which is being used in a brochure to help market—or in plainer language, flog off—the college. For once the agents do not overplay their product:

    "An outstanding group of baroque buildings adjoining the River Thames ... offering potential for a range of appropriate uses ... extending in all to about 18·75 acres".

The Royal Naval College, advertised in Country Life?

That is how the public sees the sale of the Royal Naval College. I am well aware that the "sale" is a 150-year lease and that, of course, its listed status affords protection; indeed, that the Secretary of State for Defence has said that Tesco need not apply. But the expressions of public outrage have been because the public sees this as a privatisation too far.

I have sought this debate in the hope that the Government will use the opportunity to give some explicit assurances and reassurances. I was glad to receive on Friday a letter from the Secretary of State for Defence who wrote that,

    "the Government's policy is to stimulate a wide ranging debate".

That is welcome—but through estate agents whose marketing material talks of determining the extent of market interest?

That these are defence buildings is almost an accident of history. They are primarily part of our national heritage, and I am glad that there is a Minister from that department listening to the debate, even though he may not be replying tonight. I hope that his presence is to give him the opportunity of coming in later and may be redirecting matters. Protecting our heritage should be the first consideration, and not merely protecting but enhancing.

The Royal Parks Review Group, under the chairmanship of Dame Jennifer Jenkins, recommended in March:

    "The Government should announce its commitment to the public opening of the direct route through the Royal Naval College and the National Maritime Museum into the park as a Millennium project and provide the necessary funds for architectural and planning studies and associated works".

The Secretary of State has written that he would love to see Greenwich more open to the public and the reopening of the Great Axis from the approach on the Thames, through the college and across the park. According to the agents' brochure, access to the Painted Hall and the chapel is to be maintained (they are open for two hours a day) and "it is hoped" that the Grand Axis will be opened up. To quote again:

    "Any enhanced public access should be at nil cost to the public purse".

That is a long way from requiring enhanced access.

Can the Minister assure your Lordships that decisions as to the future of Greenwich will be heritage-led? Can he assure us that, whatever offers are made, decisions will be based on a strategy for the widest public access to and enjoyment of the college as part of the whole complex and park, after full public debate? Indeed, can he tell your Lordships the process of how decisions will be made? Can he assure the nation that the Government see Greenwich, not as a cost to be cut, but as a national asset to be enjoyed?

More specifically, will he explain whether the Secretary of State has to accept the best financial offer? I understand that he holds it as a trustee for a charity, the ultimate beneficiary of which is a school. How does that accord with what must be conflicting interests as the custodian of a major piece of public heritage? The brochure indicates primary legislation—an Armed Forces Bill to be introduced next month. Can the Minister tell us what that Bill is to do? One might hope that it might be to provide for tunnelling the major road, the A.206, which divides the college from the park, so that indeed the two areas could be enjoyed as one, but somehow I doubt it. Can the Minister say whether the Bill is to enable a charitable asset to be sold and to provide for the proceeds?

What is needed to deal with the nuclear reactor on the site? The reference in the brochure to "addressing its removal" seems almost disingenuous. Can the Minister say how difficult an operation that is, and is it in fact feasible? I believe that most tenants would not view with complete equanimity the prospect of a nuclear reactor in the cellar, however small.

Will the Government rule out the possibility of the college being occupied by a foreign company or institution? I hope that this will not be taken as xenophobia. It is not, but the recent unhappy experience of the need to negotiate access for VJ Day to the war memorials at County Hall, which is now in foreign hands, gives particular pause for thought, when the college is in a sense a memorial to our naval history.

Will the Government look at the future of the site in its context, not just as on the meridian, which of course it is, but as part of the Thames Gateway, the gateway to the capital? The Navy is not moving out until 1997. Though I accept there is much to be planned and the buildings are costly to maintain, will the Government accept that the public will not tolerate a hasty decision? Of course, the public understands that buildings change their use from time to time. But what they abhor is the prospect of a private use. What they want is vision and courage.

Above all, will the Government accept that the suspicion that their actions have created is not mere hysteria? From this building we look across the river to County Hall—to be used as what: an hotel or an aquarium? Upstream from here is Battersea power station, festering, stripped of its roof and of its dignity. Downstream is Greenwich.

6.25 p.m.

Lord Selsdon: My Lords, I am very grateful indeed to the noble Baroness for introducing this Question today, and perhaps I may say with how much charm and eloquence she has presented the problem now confronting the Government. There is nothing new about this: most ministries of defence or ministries of war are in general run by Army men who often lack sensitivity. Perhaps I may recall again a favourite quotation of that great admiral, Jackie Fisher, that the role of the British Army should be that of a projectile to be fired by the British Navy.

I cannot believe that the First Lord of the Admiralty would have sanctioned such behaviour. My first question to my noble friend is this: does this initiative by the MoD have the approval of the First Lord; and, if not, why not? Does it have the approval of the President of the Board of Trade, based upon the original statutes of the Council of Trade? Who made this decision?

The second question is this: who handled it? If I may use an old naval word, it is something of a "cock-up". That is a naval word and there is nothing derogatory about it at all. For me, returning from abroad, to have someone ring me up as though they had read that old-fashioned naval book Make a Signal!, to be told, "Admiralty to flog off Greenwich to the highest bidder by Knight Frank & Rutley (or whatever they are called) who are hereby appointed" I thought was a joke. I thought that maybe there was a 1st April which had appeared in the twilight of our year. But, no; it was serious.

The criticism that is being launched at the Government is very serious indeed. It has the potential of being a major banana skin for my noble friends. First, there is Greenwich; and, secondly, today I read in the press that with great glee the idea is to sell off the Treasury and maybe rehouse it. Thirdly, we shall probably have the sale and lease-back of your Lordships' House, because I am sure that we shall be much more reliable and trustworthy tenants than those of another place!

I do not believe that the Government intended to make such a disastrous presentational mistake. I believe that they wanted to open up the debate on the lines of, "What do we do about Greenwich if the MoD does not want it any more?". Three cheers! The MoD does not want it any more! The Government themselves should have led this debate and discussion. Perhaps they should have asked themselves, "What can we do for history?" rather than ask, "What can history do for us?"

Greenwich is a place of great note. Those of us who have travelled up and down the Thames, who have walked through Brunel's foot tunnel and lived and re-lived today and ancient days, realise that it has a potential to do something or for something to be done with it. I suggest that, as it is, it has a negative value and no value at all. The Government have recognised that. They do not want the cost around their neck, and they want to off-load it onto somebody who will meet the cost.

That is the wrong attitude because the value that Greenwich has is not a tangible, monetary value that may go up or down today or tomorrow like the value of buildings when interest rates go up or down and property markets collapse. It has a form of celestial value which one cannot value. Any respectable agent would say, "We can place no value on this building". It is its value to the nation; not the particular piece that it is intended should be sold and which, if converted into offices, would produce 530,000 square feet of office space, which is exactly the same size, I am told, as the main tower at Canary Wharf, and sufficient to house 3,000 people and cause another collapse of the property market in offices.

It is not the alternative use which should be considered, but perhaps the re-establishment of the college's historical use. After all, we are a great maritime nation—but perhaps I should say that we were a great maritime nation. As your Lordships will recall, 100 years ago 80 per cent. of the world's ships were built in the United Kingdom. At the start of the First World War the figure was 60 per cent., and at the start of the Second World War it was 40 per cent. Just to show that it is not only this side of the House that has a monopoly on buying and selling things very badly, I remind your Lordships that as soon as the party opposite decided to nationalise the shipbuilding industry, the percentage of the world's ships constructed by the United Kingdom fell to 0.7 per cent. Over time we have seen our merchant fleet disappear.

We have very little to remind our children, grandchildren and great grandchildren of our maritime past other than word of mouth. Much of it took place before the invention of the camera, and is not recorded on film. It is recorded only in old vessels and charts and in some amazing artefacts that are not properly displayed. We have no national centre where shipbuilding can be looked at, reviewed and considered. We do not have any maritime heritage centres. However, Greenwich is, and should always be, a maritime centre, recording our maritime past and earning money from it in whatever way the government of the day may decide. There is no doubt at all of the considerable interest that exists in our maritime past.

Like me, some of your Lordships were privileged the other day to visit the hydrographer at West India Docks, where he has his ships. He is probably the greatest map maker in the world and is now based down in Taunton with a large number of ancient charts of great value which he is beginning to replicate and to market. It is reasonable to suggest that we should look at all our maritime activities and decide how many of them can be concentrated at Greenwich and the amount of income that they could generate from those who would visit them. I am not suggesting that the hydrographer should be moved from the pleasant environment of Taunton; but perhaps instead of building a grand new building in Bristol at considerable expense, the MoD should have considered relocating some of its people in London or moving many of its support services from Bath.

It is the Government who should be leading this debate. They should be leading the inquiry and not passing the matter back to estate agents or various other private sector "animals". Governments should remember that anybody in public or political life is useless at buying anything and equally useless at selling anything, getting both the price and timing wrong, usually with cataclysmic results.

I intervene not only to promote Greenwich or to say how much I love the place. I have had many discussions there in the past about the number of items that the college would like to display. We have discussed linking the college with the Royal Docks and with the docks in Docklands so that coastal vessels can be displayed. At the same time, being a Scot I realise that there is some conflict of interest because we might like to have a world maritime museum in Glasgow. After all, while the British claim to have built all the ships, it was really the Scots who did it. At the start of the First World War 50 per cent. of all the ships afloat were Scottish. We Scots were good engineers. We were good at making things. However, I do not think that we were particularly good at telling ships in which direction to go. That was often left to those such as the noble and gallant Lord, Lord Lewin. I look forward greatly to his speech, and hope that we shall have some fire and brimstone.

I support the noble Baroness, Lady Hamwee, in tabling this Unstarred Question. I regret that the Government have taken an initiative which was good in principle but have mucked it up. My noble friend the Minister now has a chance to say, "I am sorry if our communication was so bad. It was our intention to open up the debate. We do not want Greenwich to pass into foreign hands in any way. It is up to the British to decide what they should do with their heritage and to present it in the best way that they can".

6.34 p.m.

Baroness Hilton of Eggardon: My Lords, I echo the two previous speakers in being astonished at what might apparently happen to Greenwich. It seems extraordinary that the party which prides itself on its patriotism—that is true not least of the Secretary of State for Defence—should suggest selling off such a symbol of our national pride. Sometimes it has appeared that to the party opposite "patriotism" means attacking foreigners rather than doing something more positive to develop pride in our own traditions and history.

We live in a time when there is a widespread sense of insecurity and lack of purpose in this country. As we know, we are said to have lost an empire and not found anything to replace it. It seems to me that one of the things that any government should be doing is trying to develop a sense of national identity and purpose and restoring some sense of pride to the people of this country. Greenwich is essentially a symbol of our past pride and history. It is a symbol of the things that we have achieved in the past and could achieve in the future.

As the noble Baroness, Lady Hamwee, said so eloquently, Greenwich was for 500 years the site of a royal palace. We should be justly proud of the Observatory. The whole world bases its time on the Greenwich Meridian and Greenwich Mean Time. The naval college is a proud example of our great naval history. The park and surroundings could be splendid.

Greenwich is an area of economic disadvantage. It is suffering from traffic blight. The opening up of the naval college presents us with an opportunity to develop the site in a most imaginative way. Unlike the French, we have not gone in for grands projets. It is perhaps time that we had something to mark the millennium and be a grand projet for this country. We could have a vista to rival that at Versailles. We should be thinking in imaginative terms about somewhere like Greenwich which could present us with enormous opportunities.

As I understand it, the nuclear reactor gives us an opportunity to pause and to have a serious discussion about the site. I gather that it will take at least two years to remove the nuclear reactor—that is, if it can be done in so short a time. Surely that is a time during which a public debate about the site should be launched. We have truly become a nation of shopkeepers if we are not just selling off the family silver, but also offering to lease Britannia's shield and spear.

6.37 p.m.

Lord Lewin: My Lords, I am enormously grateful to the noble Baroness, Lady Hamwee, for bringing this subject to our attention and for providing us with this opportunity for a debate. I say that not least because it gives me the opportunity to put forward a constructive proposal. I regret that there will not be any fire and brimstone. I have enormously enjoyed the three speeches that we have heard so far. They have warmed the cockles of my maritime heart.

First, I must declare an interest. I did my first course at the Royal Naval College more than 50 years ago. I returned a number of times to improve my naval education. For the last four years of my active career as First Sea Lord and Chief of the Defence Staff, I lived in a house which was built originally for the Lieutenant Governor of the Pensioners Hospital. Nelson visited it often—not when I was there—and sat for one of his many portraits there. After that, I became a trustee of the National Maritime Museum, which I have been for 14 years, eight as chairman. It was a post that I relinquished with some regret four weeks ago. There is no more fascinating hobby for a superannuated admiral than that. Incidentally, I am Lord Lewin of Greenwich. Therefore, your Lordships will understand that I have a passionate concern for the future of those magnificent buildings which, to me, breathe maritime history.

I should like to bring your Lordships up to date with the present situation. I apologise to those who already know this. The Secretary of State for Defence, wearing his mantle as First Lord of the Admiralty, is the sole trustee and holds the buildings in trust for the Crown and for the benefit of Greenwich Hospital. Greenwich Hospital's interest is in maintaining its status quo—a fair rent from a good tenant and with no responsibility for the buildings. That leaves the hospital to concentrate on its charitable responsibilities, which relate to the Royal Hospital School at Holbrook and some sheltered housing for naval patients.

The Department of National Heritage has responsibility for the external maintenance and the historic interiors. For 300 years the buildings have been the responsibility of a government department. For the past 70 years it has been a charge on the department with responsibility for historic buildings. In 1924, it was the Ancient Monuments Department of the Office of Works, then the Ministry of Works, the Department of the Environment, and then, when it was formed three or four years ago, the Department of National Heritage.

Currently the MoD's responsibility is for the rent payable to Greenwich Hospital (£400,000 a year), internal maintenance, and the day-to-day management of the site. I must confess to sadness that 300 years of naval association with Greenwich is coming to an end. I support entirely the co-location of the staff training of all three services. That should have happened 20 or 30 years ago.

There has been much speculation and national unease over the future use of these most important buildings—the finest assembly of architecture we possess, as John Betjeman said. One thing is certain. They must in the future continue to be seen as an inspiration and a source of our national pride. It should be a place that local people can feel is theirs and which they are proud to share with the nation.

The noble Baroness, Lady Hamwee, mentioned the excellent report of Dame Jennifer Jenkins, which proposed transforming that part of Greenwich into a magnificent vista from the Thames to Blackheath, incorporating the fine gathering of buildings—not just the Royal Naval College but the buildings of the National Maritime Museum which incorporate the Queen's house and the old Royal Observatory. Both of those buildings are older than any part of the Royal Naval College. It is obviously most important that in considering a future for the Royal Naval College it is treated as one part of a coherent whole—a whole for which the Department of National Heritage is currently processing an application for world heritage status. The future of the Royal Naval College cannot be considered in isolation.

Let me now come to a concept for the future. Following the great national debate, and the MoD's proposals, a concept has emerged from discussions among all those authorities which have responsibility for our heritage. I would mention particularly the support of the National Heritage Memorial Fund and the National Maritime Museum. It is a concept that, while ensuring the long-term preservation of the buildings, would permit, and indeed encourage, the development of appropriate and sympathetic uses.

The proposal is that a preservation trust should be formed which would assume a 150-year lease from Greenwich Hospital, taking over from the MoD. The trust, which might perhaps be called the Royal Greenwich Trust, would be constituted as a charity—possibly an exempt charity—with an obligation to present its accounts to Parliament. The trust would be administered by a board of, say, seven commissioners appointed by the Queen. They would be people with an established reputation in the care of our heritage. Having heard his speech, the noble Lord, Lord Selsdon, should consider himself on the short list. The idea of commissioners would follow the precedent set by King William who, on the death of Queen Mary in 1694—it was William and Mary who granted the charter for the foundation of the hospital—appointed commissioners to supervise the building and commissioning of the Naval Pensioners' Hospital. He appointed 200 commissioners. That was a fund-raising ploy. The quorum was seven. Among the seven were Christopher Wren, John Evelyn, Vanburgh, and Flamsteed, the Astronomer Royal of the time.

The preservation trust's responsibilities would be managed, and its commercial activities conducted, by a subsidiary company whose board, in addition to some commissioners, would include people bringing experience of business, property, finance, tourism and public relations. The commissioners would of course look out for the heritage.

The trust's objectives would be five-fold: conservation of the buildings and sympathetic management of the grounds; encouragement of full public access and the interpretation to visitors of the historic significance of this important site; co-operation with other authorities, particularly the local authority, in the promotion of Greenwich as a world heritage site of international status; re-establishment of the ceremonial use of Greenwich as a centre for the reception and entertainment of visiting heads of state, and use by the Government and the European Community for important meetings and entertainment.

For centuries, Greenwich was the point of entry for visiting Royalty. When Princess Caroline of Brunswick arrived at Greenwich to marry the Prince of Wales, the Prince of Wales did not bother to go to meet her. The naval pensioners turned out in their hundreds to give her a warm welcome and she was heard to remark to her companion:

    "Are all Englishmen lacking an arm or a leg?"

Finally, and the most important objective, the trust would be responsible for generating a satisfactory level of income from the letting of the buildings and other activities consistent with sympathetic use and within planning constraints.

The buildings have, as the noble Lord, Lord Selsdon, said, great potential for many and varied uses. The 500,000 square feet of space ranges from the magnificent Painted Hall to 300 rather substandard cabins—bedrooms to your Lordships. There are a number of lecture theatres, three fully equipped libraries, four splendid residences—one was built for Charles II—two other houses and seven flats. They could provide a significant rental income.

Greenwich University has expressed a firm interest in making use of all the buildings. It could make good use of a large part of the academic accommodation, but I would suggest that, with education as its prime purpose, Greenwich University would not be the right authority to take full responsibility for this important heritage site with its historic buildings and their maritime association, nor to promote them as a tourist attraction and part of the world heritage site.

The National Maritime Museum would of course be prepared to take responsibility for the Painted Hall which for over 100 years was the nearest the nation had to a National Maritime Museum—that was before the National Maritime Museum was formed. The museum would welcome the opportunity to expand its galleries and display more of its immense and wealthy collection. It could store its extensive archive in the basements and establish a maritime research centre. Other museums and galleries could find space to display collections that are currently in store.

The Maritime Trust, which looks after the Cutty Sark, has expressed an interest in one of the buildings in the corner of the grounds as a visitor centre for its tourist attraction. There are 40 City livery companies which do not have halls of their own. The buildings could provide them with office space and the use of the Painted Hall for their ceremonial occasions. The extensive cellars at Greenwich would provide them with ample storage space for their wines.

The possibilities are manifold. They tempt the imagination, as they obviously tempted the imagination of the noble Lord. I have touched on only a few. He thought of many more. How would all that be financed? The trust—a charity—would be in a position to apply to the National Heritage Lottery Fund for a grant to cover the initial establishment costs. I suggest that there could be few heritage projects more deserving of lottery funds than the preservation of those historic buildings and their presentation as a vibrant cultural centre, a place to remind the nation of our great maritime heritage.

Once established, there is confident expectation that the trust could generate sufficient income from sub-letting space and from its commercial activities to cover running costs at the very least.

Since lottery funds cannot be used to substitute for an existing government commitment, the key to this is that the Department of National Heritage should continue its present responsibility for external maintenance. Currently that is running at about £2 million per year while a major refurbishment programme is in progress. But once that is completed—and it should be completed in about 1997—the year-by-year running costs are likely to fall to about £500,000. However, since the Ministry of Defence would be relieved ultimately of all its responsibilities for rent, internal maintenance and management, the burden on the Exchequer would be significantly reduced.

I end with another quotation from the historian Arthur Bryant who said of Greenwich:

    "There is no place in England so rich in History and Architecture".

We must ensure that it is preserved properly as part of our national treasure. I commend this proposal for the support of your Lordships and I commend it to the Minister and his colleagues for their sympathetic consideration.

6.50 p.m.

Lord Kennet: My Lords, I followed the noble and gallant Lord's exposition of his plan with the greatest attention. Clearly what he has said is of considerable importance for the future of Greenwich. I shall return to it in a few moments with some possible refinements.

When the Government flogged off County Hall I thought to myself, "My God, they'll be flogging off Greenwich next", but I did not really believe it. We have come to that. It is a natural progression. If the Government are prepared to take this step, it is necessary to look ahead further to see what it is to be next.

A great saving could be made by converting the buildings in which we sit to more spectacular and tourist, floodlit use. We do not need quite as much space as we have and smaller accommodation would be possible. The Monarchy is expensive; Buckingham Palace is a fine property. I say those things partly out of gloom and partly flippantly but, above all, to ask the Government to consider how they have got themselves into the position of dreaming of leasing the Royal Navy College at Greenwich for 150 years. Even practically, they must have noticed that the Dreadnought Hospital and the Nurses' Home which form part of the campus there have been on the market for some years and no progress has been made.

This proposal is a prime example of the sale-room state. It is a new kind of state not known hitherto to Europe. It sets as its first priority, long before looking after its people and especially its more unfortunate people, the realisation of all physical property that it has, to turn it into money.

Versailles has been mentioned. Can we imagine the French selling Versailles or selling a 150 year lease on it? Obviously not. That is not merely a fancy-that fact. It teaches us something about the difference between the two countries, and I hope the Government will give themselves time to meditate on that, given the extraordinary closeness of our origins as democracies in the world.

Many noble Lords will have visited the splendid palace which houses the French Senate. If noble Lords have looked out of the windows to the south, they will have seen the dome and the monumental appearance of the National Observatory of France at the end of a grand avenue. They will have been aware also that the French meridian is only a few miles away from the British meridian. The fact that the world now uses the meridian of Greenwich, and calculates all its measurements from that, is due to the fact that we happened to beat France in a war. I submit that even that fact in itself should make us pay a bit more attention to maintaining the historical integrity and the public-ownership integrity of Greenwich, because we are at risk of selling off the world's meridian as well as everything else.

I believe—and no doubt the Minister will comment on this—that the proposed sale is illegal. The Act of 1869 which lays down the regime for the ownership of the Royal Hospital of Greenwich, as it then was, states quite explicitly that the Royal Hospital may not be sold or leased to any party except the Royal Navy, institutions of the merchant marine or other institutions having a clear connection with our interests as a maritime nation.

The noble Baroness, Lady Hamwee, said that she wondered what would be in the Queen's Speech and that there may be something about this matter in that Speech. Is my surmise correct that the Queen's Speech will seek to correct the illegality of the Government's present action in putting Greenwich on the market? Will it be an act of retrospective legalisation of government action? If so, I believe that both Houses will have plenty to say about that.

The little reactor called Jason has been mentioned. It has been explained in the other place that Jason is not just a mechanical object standing alone, but is the centre of quite a large network of training activities which belong to a large system throughout the country for training. I wonder what thought the Government have given to this matter. I have seen mention of the figure of £20 million for the de-commissioning of that reactor. On the other hand, should we read all this as an element of hope; that the Government cannot be serious in their leasing plan if they expect anybody to sit on top of Jason while it decays without being removed, or even to sit on top of it while it is removed, because such an activity would obviously put a stop to anything else in that block for a year or two?

What should have happened is this. When it was found that the Staff College did not need the whole of Greenwich, it would have been better to bring what was at Camberley to Greenwich and sell Camberley. Camberley is very nice, well thought out, neat, and works, but it is not a great national site. The Government made a mistake in their decision to take matters that way round. It would have been better and probably not too difficult to bring Camberley to Greenwich rather than to take Greenwich to Camberley.

Lastly, I listened with the greatest interest to the noble and gallant Lord about the National Maritime Museum plan. By now, it is very much wider than that. It has become elaborated. I think that that makes it of greater interest than it was before. The buildings at Greenwich are not especially suitable for any sort of museum. They consist of two vast and wonderful spaces—the chapel and the hall—in neither of which could one possibly put exhibits without ruining them. As well as that, it consists of a very large number of small rooms with one door each. That is typical of the kind of accommodation in which you cannot have a museum, because people would be going in and out of the same door all the time.

I should like to add to the list of deserving institutions mentioned by the noble and gallant Lord as being possible co-tenants with the National Museum under the umbrella of his committee of trustees. I have in mind the World Maritime University, which is now at Malmo in Sweden for no very good reason. Its teaching is in English. Its students, who come principally from the third world, have to come to London all the time to obtain instruction in English on the world-wide realities of the maritime world. The university is under the umbrella of the World Maritime Organisation, which has been situated in London since its birth.

It seems to me that Greenwich is well suited for this university; indeed, it has been functioning as a military university for many years. If we could, over time, gradually bring that institution from Sweden into Britain, I believe that there would be a great deal to be said for it. I do not know whether there will be room for that, a museum presence, the hydrographer and all the others that have been mentioned, but one thing stands out very clearly. With all those possible institutions to fit in to that majestic and marvellous campus, the role of private enterprise seems pretty small. I hope that the Government will heave a sigh of relief on 15th November (I believe that they were right to give a very short period for bids) and be able to say: "Well, we didn't get anything worth considering, so let us resume our proper duty as a government and settle its use ourselves".

7.1 p.m.

Lord Williams of Elvel: My Lords, the House will be grateful to the noble Baroness, Lady Hamwee, for tabling the Question. I should like to express my thanks to her. I had the privilege of speaking to a Mess Dinner not so very long ago in the Painted Hall. Therefore, I have a particular interest in ensuring the future of what many noble Lords have quite rightly said is one of our great national—and, indeed, international—treasures.

Perhaps I may say to the noble and gallant Lord, Lord Lewin—and I do so without impertinence—that I found his speech to be most impressive. If I may say so, I very much hope that he will put his proposal in writing to myself and to my honourable and right honourable friends because, if the Government do not take it seriously, we shall certainly take it very seriously indeed.

I also agree with the noble and gallant Lord that there should be a Joint Service Command and Staff College. After all, there are five institutions which do not necessarily do the same thing but different things in different locations, and which could all be combined into one.

I understand the Government's problem that the Royal Naval College has to be subsumed into a larger entity. Nevertheless, I find it odd that the Government in correspondence—and I hope that I may refer to correspondence between Ministers and my honourable friend Mr. Raynsford, who is the constituency Member of Parliament for Greenwich—seem to waver a little about what the consequences of the move might be. For example, in the noble Earl's letter to my honourable friend, he says that there will be the "Expression of Interest" campaign, the object of which is,

    "to seek out imaginative, sympathetic and appropriate uses for Greenwich"

The noble Earl goes on to say:

    "When assessing any bids received for the college buildings we will ensure that the potential bidders produce a financially sound business plan, a viable maintenance and management strategy for the historic buildings".

Let us take those two points. First, a "viable business plan". I am not sure what sort of viable business plan there could be for the buildings at Greenwich. Moreover, to be absolutely honest, I am not sure that the Ministers in the Ministry of Defence could recognise a viable business plan if they saw it walking down the street in Piccadilly in the middle of the day. Equally, I am not sure that a,

    "viable maintenance and management strategy for the historic buildings",

would last more than 30 seconds. We are talking about centuries; we are not talking about 30 seconds, or two minutes.

No doubt the noble Earl will excuse me for quoting from the letter, but it is on the record. In it he continues:

    "If no suitable non Government schemes for Greenwich emerge from the present marketing campaign, other potential defence uses, such as the Defence School of Languages, may be appropriate".

There has been a long-standing argument ever since the defence cost studies about whether Camberley is a suitable location for the Joint Service Command and Staff College or whether it should properly be in Greenwich. All the costings that the Government have produced to date say that Camberley comes out a mile ahead of Greenwich. However, there was an article in the Independent on the 16th October this year, which stated that detailed studies into the cost of refurbishing the existing Army Staff College had disclosed that tens of millions of pounds will be needed to carry out the work and that the cost is substantially more than predicted in the initial studies, raising fears that savings might well not be achieved until into the next century. The article then quoted an official from the MoD, who said that there was a lot of teeth sucking going on about the scale of the costs involved in the refurbishment of Camberley. The conclusion would be that if everything else is equal, as my noble friend Lord Kennet said, and if costs are equal, then surely the JSCSC should be located in Greenwich rather than Camberley.

In the letter to my honourable friend the noble Earl went on to refer to legislation. A number of speakers have raised the matter during the course of tonight's debate. He said that,

    "if the occupation of the site by non government bodies is constrained by Section 7 of the Greenwich Hospitals Act of 1869"—

the 1869 Act provides that Greenwich Hospital should be devoted to charitable purposes for service use—

    "legislation can be used to clarify this and the Armed Forces Bill might be an appropriate vehicle."

I believe that that answers the question put by my noble friend Lord Kennet. The noble Earl goes on to stress the question of,

    "protecting the charitable interests of Greenwich Hospital and the integrity of the site itself".

I believe that the noble Earl was quite right to lay stress on that point.

I do not wish to prolong the debate. I believe that many speakers have put most of the points that I wished to make to the noble Earl. I shall simply ask the Minister two questions: first, will the Government give us an assurance that, if it turns out that the cost of siting the JSCSC in Camberley is equivalent—not more, not less—to the cost of siting it in Greenwich, Greenwich would be the preferred option and that the latter would be used by the defence establishment for the kind of purposes for which Greenwich has served over the centuries?

Secondly, will the Minister give the House an undertaking and the assurance that when the noble and gallant Lord, Lord Lewin, produces a plan (which I understand has been discussed with many and various people and which has a great deal of merit) it will be considered in front of any private application for the leasing of Greenwich, whatever buildings may be there? After all, all speakers this evening have said that we regard this as a part of the national heritage. I am glad to see the noble Lord, Lord Inglewood, sitting on the Front Bench and, I hope, nodding his head. Well, if he is not nodding his head, he is trying to do so. I very much hope that the noble Earl will be able to give us an assurance that this is the fundamental principle behind what the Government intend; otherwise, when the Armed Forces Bill comes before us in the next Session, I am afraid that there will be much opposition to it.

7.10 p.m.

The Parliamentary Under-Secretary of State, Ministry of Defence (Earl Howe): My Lords, this has been a most stimulating debate on an issue which arouses deep feelings. It has been no surprise to me that noble Lords who have spoken have done so with considerable passion, as well as an obvious desire to ensure that these wonderful buildings at Greenwich are respected and cared for. Her Majesty's Government share that passion, and I am grateful to the noble Baroness for raising this important issue tonight.

It is right and proper that proposals which affect the future of substantial national institutions should be the subject of widespread and informed debate before decisions are taken. That is the strength of the democratic traditions we enjoy. The buildings which comprise the Royal Naval College at Greenwich are very much a case in point. Indeed, there are few sites and few buildings in this country which match the architectural and heritage importance of Greenwich. It is a glorious national treasure. It is, therefore, essential that we seek the widest possible spectrum of views. The Government are committed to this. We shall not take a decision quickly or without the most careful reflection.

The contribution which your Lordships have made tonight is therefore both welcome and timely. It has also provided, if I may say so, some interesting and constructive ideas. The same, I am afraid, cannot be said of some of the recent media commentary and it is a matter of considerable regret that there has been misinterpretation and misinformation about the Government's intentions over Greenwich. I therefore welcome the opportunity to explain the Government's plans. These are straightforward: to find a suitable, sympathetic and enduring use for this magnificent group of buildings which will protect them, enhance them and offer greater access to them for members of the public. The prospect is an exciting one.

Let me set the scene. The Royal Palace at Greenwich was constructed around 1500 on the site of the present Royal Naval College. King Henry VIII and Queen Elizabeth I were born there, and it was one of the most frequently visited royal palaces of the time. An undercroft from the Tudor Palace still exists and is incorporated within the cellars of the current buildings. Its maritime traditions were established with the knighting there of Sir Francis Drake in 1581, and the Seamen's Hospital was constructed after the grant of a Royal Charter by King William and Queen Mary in 1694. It was in the subsequent years that the four main buildings were erected, to Sir Christopher Wren's overall master plan, with the whole complex substantially completed by 1750. The Seamen's Hospital, which in many respects served the same function as the Royal Hospital at Chelsea, eventually closed through lack of demand in 1869. Four years later the Royal Naval College moved from Portsmouth and has occupied the buildings continuously since then, paying rent under a lease from the Greenwich Hospital Crown charity. Since 1873, the historic buildings have served a variety of occupants, not least the Joint Services Defence College.

I mention this impressive history to show not just the grand lineage of the site but to demonstrate that change is nothing new for what has become known as the Royal Naval College. What we are witnessing now is the drawing to a close of a chapter in the history of the buildings, and, I very much hope, the dawn of another, equally glorious, chapter in their life. This offers a challenge, and a tremendous opportunity.

The question has been asked why the Navy's use of the Royal Naval College is to cease. As noble Lords will know, the period since the end of the cold war has seen us having to adjust our training and command systems to fit the changing spectrum of military operations. One consequence of this is a growing need to adopt a more joint approach to defence activities, with the services and their command structures operating interdependently and in many cases in a fully integrated way.

As part of our commitment to this, the Government decided last year on a new Joint Services Command and Staff College as the best means of training our future military officers. This joint training regime, which we intend will start in 1997, will replace the three single service staff colleges and the Joint Services Defence College which, like the RNSC, is located at Greenwich. I am grateful to the noble and gallant Lord, Lord Lewin, and the noble Lord, Lord Williams, for the expression of support which they gave to that policy. As noble Lords will recall, we carried out an exhaustive review of possible locations for the college. Greenwich was considered fully.

The noble Lord, Lord Kennet, said that Greenwich should have been chosen in preference to Camberley. We do not believe that Greenwich offers a cost-effective site for the college. Indeed, it is precisely the architectural glories of Greenwich, with its four Grade I listed buildings and its status as a scheduled ancient monument, which make the site at once so special but so bound with restrictions. The construction of new buildings and any significant conversions necessary would be ruled out on planning, aesthetic and cultural grounds.

The new college will have over 600 students, whereas the Royal Naval Staff College and the Joint Services Defence College—the current Greenwich occupants—total only 172 students. Fitting the much larger college into the Greenwich buildings would involve a costly works programme. Our appraisal of the staff college options, on which we consulted publicly, demonstrated conclusively that Greenwich was considerably more expensive than Camberley. But more importantly, the extensive building works would have involved ripping out much of the current internal fabric of these magnificent buildings, and that is something that the Government were not prepared to contemplate. The continued presence of the military would have precluded greater access to the public.

The Royal Naval College buildings will therefore fall vacant during the next few years. It is therefore necessary to consider their future. The Government are committed to finding the best possible use for the site, a use worthy of its heritage status, and a use which will allow greater public access. In the background the possibility exists of another defence use should an alternative scheme not be found. But my right honourable friend the Secretary of State for Defence, in his capacity as sole trustee of the Greenwich Hospital Crown charity, thought it right that the Government should also explore other potential uses for the college.

Both the University of Greenwich and the National Maritime Museum had already shown themselves keen to occupy buildings on the site. However, if we are to find the best uses for Greenwich, we ought to cast the net wide. The Government do not have a monopoly of good ideas. As the noble and gallant Lord, Lord Lewin, has mentioned, it has, for instance, been suggested that those City Livery Companies who have no halls to dine in might use the Painted Hall for the purpose. I very much hope that other proposals from prestigious and historical associations will come forward.

Lord Callaghan of Cardiff: My Lords, I am much obliged to the noble Earl for giving way. However, in listening to the limitations it has occurred to me to ask whether the Government have thought of approaching the International Maritime Organisation which is, after all, the only United Nations agency that we have in this country and is situated just over Lambeth Bridge on the Thames. It would be a prestigious body to occupy the building as it carries out good work and to some extent would fit in with the past traditions of the area.

Earl Howe: My Lords, I am most grateful to the noble Lord, Lord Callaghan. That is certainly a suggestion that I shall take away with me and pursue. To achieve the overall aim which I have outlined the Defence Secretary and the Heritage Secretary jointly invited "expressions of interest" to give possible occupants the chance to suggest an appropriate use for these superb buildings. In doing so, my right honourable friend is working closely with the Department of National Heritage and has consulted widely with English Heritage, the Government Office for London, Greenwich Hospital and the London Borough of Greenwich.

As I have intimated, a key element in the Government's plans for Greenwich is to see the buildings and estate more open to the public. If the new use is not defence related the restrictions arising from considerations of national security will ease, and that would offer an obvious advantage. We therefore intend to look favourably on proposals from bodies which are able to use the buildings in a sympathetic way and allow the British people to enjoy their history and appreciate the splendour of the site. This exercise is not about seeking the highest bidder. It is about finding the right occupant.

I turn now to some wider and equally important aspects of the issue. There has been considerable discussion of the prospect of nominating Maritime Greenwich as a world heritage site. We shall shortly be seeking views on the proposal and, subject to the outcome, we hope to make a formal submission to UNESCO by July next year. I can say, however, that we would very much like to see the achievement of Dame Jennifer Jenkins' vision of re-opening the Great Axis from the approach on the Thames, right through the college and across Greenwich Park to Wolfe's statue and Blackheath beyond. If those ideas develop the prospect is an exciting one—one which will return us nearer to the glorious architecture and symmetry created by Wren, Vanbrugh and Hawksmoor and so famously depicted by Canaletto.

If that is to be possible we shall, of course, need to safeguard the future of the site. This will be achieved in two ways: first, through the planning system controlling the use and alterations that can be allowed to a Grade I listed building and scheduled ancient monument; secondly, we can supplement the strict planning controls by special convenants in any lease agreement which the Defence Secretary can enforce as sole trustee.

Having touched on the question of the Defence Secretary's trusteeship, perhaps I should say a little more about his dual responsibilities. He is sole trustee, on behalf of Her Majesty the Queen, of Greenwich Hospital, which is a Crown charity. He is required to see that the rental income to Greenwich Hospital is protected for the continuity of its charitable works. He is technically also the tenant of the site for as long as the Navy remains, but it is his role as trustee which requires him to ensure that a suitable use and occupant for the buildings is found.

The noble Lord, Lord Kennet, asked whether the Secretary of State has the authority to grant a lease to a non-government body in view of the terms of the Greenwich Hospital Act 1869. The noble Lord will wish to know that the legal position is currently being clarified. However, to avoid any doubt we hope to use the 1996 Armed Forces Bill to introduce an amending clause. Needless to say, the Secretary of State will not grant a lease until the legal position is clear.

Lord Kennet: My Lords, would it not have been better if the Government had refrained from putting the buildings on the market until they knew whether or not they were proposing an illegal course of action?

Earl Howe: My Lords, I do not agree with the noble Lord. In fact, it would have been irresponsible of the Government not to proceed as they have, because we are running out of time in view of the programme relating to Camberley. It is essential that, if it can be achieved, there should be a seamless transition at Greenwich between one tenant and another. That is why the Government thought it right to proceed as they did. There is no question of the Government having acted illegally in what they have done to date.

I turn now to the handling of the decision on the future of Greenwich. My noble friend Lord Selsdon asked who made the decision. I hope that he will gather from what I have said that no decision on the future of Greenwich has been made. The period for submitting expressions of interest ends on 15th November. We shall then consider any proposals received against rigorous criteria. We shall be taking account of the views expressed as to appropriate future use, including those of your Lordships. We shall not be rushed into a decision, and I do not expect a final choice to be made before next year. Then, if a suitable non-defence use is judged most appropriate, we would be prepared to grant a lease, with all the appropriate safeguards, to those whose proposals merit it. I emphasise—and this is a point that has been often misrepresented so far—that the freehold is not for sale. The buildings will remain in Crown ownership and rent from them will continue to accrue exclusively to the Greenwich Hospital charity just as it has under the occupancy of the Royal Naval College.

Perhaps I may touch specifically on the suggestions made by the noble and gallant Lord, Lord Lewin. He suggested that an umbrella preservation trust should be established to oversee the future management of the buildings. He was kind enough to mention that to me before this evening's debate. As I understand it, that might involve the appointment of commissioners of substantial public standing to administer the trust, with suitable experience of heritage and of the traditions of Greenwich. The trust would then ensure that the unique character and characteristics of the buildings are protected and developed in the sympathetic and imaginative way that many noble Lords have commended tonight. There would, of course, be many details to address, not least with the Greenwich Hospital charity, for whose exclusive benefit the site is held. I am happy to assure your Lordships that I shall take that idea away for careful study along with all other interesting and viable proposals that emerge after 15th November.

A number of noble Lords have referred to the Navy's training reactor known as JASON, which is located in the King William building. Let me briefly explain the position. There have been several ill-judged articles in the press which have given a false picture of the reactor's size, power and safety record. The reactor, of very low power, was established at Greenwich over 30 years ago to educate personnel in the theory and operation of nuclear propulsion systems. The routine output of the reactor is capable of running one small light bulb. It has an exemplary safety record. If the MoD vacates Greenwich, JASON will be removed in concert with all of the statutory and regulatory authorities. No non-defence occupier would use the building before the work is finished.

As I said at the outset, this debate has been welcome and timely. I have been immensely heartened to listen to the ideas of noble Lords. I take as a key objective the need, expressed with eloquence and passion by noble Lords this evening, to sustain the conservation of the site for public enjoyment well into the next millennium. The stature and heritage of the buildings demand that the ideas for their future match their grand design. The exciting proposals being developed in the wider context of Greenwich call for a bold and sympathetic solution. It is clear to me that the country expects the Government to honour their obligation to find the most appropriate, viable and enduring use for the site. I take this opportunity of saying that that is precisely what the Government intend to do.

Accommodation Level Crossings Bill [H.L.]

Returned from the Commons agreed to.

Mental Health (Patients in the Community) Bill [H.L.]

Returned from the Commons agreed to with amendments and with a privilege amendment; the Commons amendments ordered to be printed.

        House adjourned at twenty eight minutes past seven o'clock.

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