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Lord Campbell of Alloway: My Lords, can my noble and learned friend tell us what "co-operation on competition" means? If one is competing, how does one co-operate? Alternatively, is it co-operation on anti-competitive practices? I do not understand it at all.

Lord Fraser of Carmyllie: My Lords, that is precisely the position. I am sure that my noble friend supports the reduction, as best we can, of all barriers to trade. One of the barriers which the report sought to address is the respect in which the failure to enforce competition policy, in itself, amounted to a barrier to trade. As I indicated, in our view there is an absence of clear, empirical evidence that that is indeed a barrier. However, it does not seem to me to be in any way contrary to the interests of this

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country to analyse whether there are such barriers and to consider what steps might be taken on a bilateral, pluralateral or multilateral basis in order to avoid them.

Lord Peston: My Lords, is the noble and learned Lord aware that I strongly approve of his previous answer? Does he not agree--this has nothing to do with some of the debates that are taking place as regards the future of the Community--that if the Community is to mean anything at all, it must be a Community in which there is free competition? Is not the point of studies of this kind--leading, we hope, to government action--to do precisely what he says, which is to remove barriers to trade of all kinds? Some of those barriers are subtle and require definite study to establish what they are. Competition policy is a favourite treadmill, is it not? Every time the Government, or their agencies, dream up ways of dealing with one kind of anti-competitive practice, industry discovers some more. Surely, therefore, one must agree that this kind of work is vital.

Lord Fraser of Carmyllie: My Lords, I am not sure whether it is more damaging for the noble Lord to agree with me or for me to have the noble Lord agree with what I said. The important matter is that this was not an expensive report. The academics involved were not paid; indeed, some of them did not even claim their travel expenses. It is a report of that character. It is there to be studied by all those who have an interest in the subject. It is clear from the United Kingdom's standpoint and indeed that of other member states that a great deal of additional work through a working party requires to be undertaken. This report is not an example of one of those gross excesses which the European Commission is sometimes accused of. It probably cost less to set it up than to answer this Question.

Lord Clark of Kempston: My Lords, does not my noble friend agree that irrespective of what the report states, the competitive position of the United Kingdom would be gravely damaged if indeed we were to sign up to the social chapter or have a minimum wage?

Lord Fraser of Carmyllie: My Lords, I certainly agree with my noble friend. However, in the study that I have undertaken of the report neither issue is addressed within it.

Lord Eatwell: My Lords, would not one of the virtues of the minimum wage be the fact that these academics would at least have received something for their toil?

Lord Fraser of Carmyllie: My Lords, what we seek is Oxbridge academics coming to London and waiving their travel expenses.

Lord Bruce of Donington: My Lords, is the noble and learned Lord aware that I cannot let him off the hook as easily as that? Is he not aware that even the Ministers who have read this report cannot possibly understand what is in it anyway? The report finishes with the assertion that it presents a useful way of opening up further discussion on the matter. Surely, if the European Union is to mean anything at all, it should deal with practical problems. It does not require indefinite speculation by numbers of so-called qualified people who start a new language with

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no meaning in order to enunciate its policies. This is a meaningless document and the Commission should stop issuing a mass of paper which means nothing to anyone.

Lord Fraser of Carmyllie: My Lords, the Government are clear that we should work towards further liberalisation of world trade. The World Trade Organisation may be the best vehicle for doing that. It seems to me there is nothing wrong in an attempt of this kind to identify what the issues are. As I indicated, it is our view that they have not been properly identified on a clear factual basis. Therefore, we believe that a working party should be established to consider the matter further. The noble Lord can rest assured that no one is in any sense bound by the rather loose recommendations and conclusions of the report.

Deputy Chairmen of Committees

3.3 p.m.

The Chairman of Committees (Lord Boston of Faversham): My Lords, I beg to move the first Motion standing in my name on the Order Paper.

Moved, That as proposed by the Committee of Selection the following Lords be appointed as the panel of Lords to act as Deputy Chairmen of Committees for this Session:

L. Aberdare, L. Airedale, V. Allenby of Megiddo, L. Ampthill, L. Broadbridge, L. Brougham and Vaux, L. Burnham, L. Chesham, L. Cocks of Hartcliffe, B. Cox, L. Dean of Harptree, L. Elliott of Morpeth, L. Geraint, L. Graham of Edmonton, B. Hooper, E. Listowel, B. Lockwood, L. Lyell, L. McColl of Dulwich, L. Murton of Lindisfarne, B. Nicol, V. Oxfuird, V. St. Davids, B. Serota, L. Skelmersdale, L. Strabolgi, L. Strathclyde.--(The Chairman of Committees.)

On Question, Motion agreed to.

Parliamentary Office of Science and Technology (POST)

The Chairman of Committees: My Lords, I beg to move the second Motion standing in my name on the Order Paper.

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Moved, That as proposed by the Committee of Selection the following Lords be appointed to serve as members of the Board of the Parliamentary Office of Science and Technology (POST):

L. Dainton, L. Flowers, E. Selborne.--(The Chairman of Committees.)

On Question, Motion agreed to.

Reserve Forces Bill [H.L.]

3.4 p.m.

The Parliamentary Under-Secretary of State, Ministry of Defence (Earl Howe): My Lords, I beg to move that this Bill be now read a second time.

It is not every year that my department introduces new Bills to Parliament so I very much welcome this opportunity to open the debate on the Second Reading of the Reserve Forces Bill this afternoon. I am particularly pleased that it is being introduced so soon after the gracious Speech.

The reserve forces are a vital element of our armed forces and the Government continue to attach the greatest importance to them. Looking back over the years we can see that the reserves have always adapted to meet changing circumstances and commitments. They have become experts in a wide range of skills and specialisms, deriving from their military training and their civilian employment. As your Lordships will know, reservists are serving in support of a number of current operations abroad. I am sure that the House will wish to join me in paying tribute to their dedication and professionalism in carrying out their tasks in what are often taxing situations.

It is perhaps a truism, but nevertheless an inescapable truism, that the changing international scene presents us constantly with new uncertainties. Although the threat of world conflict has abated there are still many serious crises around the globe. Our reserves can play a significant part in our military response to those crises as part of the international effort. This Bill will make it easier for them to do so. In short, the Bill is designed to bring the law governing reserves up to date taking account of the changes in society, in the economy, in the services, and in the strategic environment that we have seen in the 30 years since the previous substantial reserve forces Act.

As noble Lords will recall, the Bill was published in draft for consultation on 30th March this year. Copies were widely distributed to Peers and Members of another place, to employers, reservists and other interested parties. We invited comments and we received over 500. The great majority of those comments were generally supportive of our proposals. The many points of detail raised have undoubtedly helped us to improve the Bill. We have summarised these comments, with two principal letters reproduced in full and 30 extracts from others on specific points. This summary is available from the Printed Paper Office and in the Library of the House.

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I know that many reservists are enthusiastic about our policy objective of using reserves more flexibly and that they welcome the opportunities the new legislation will offer them. I should like, if your Lordships will permit me, to outline briefly the main new provisions of the Bill. The first of these, covered in Part III of the Bill, enables reservists to undertake periods of full-time and part-time reserve service. This is a significant step forward from the current arrangements for the use of volunteers from the reserve forces without call-out. These currently require them to leave the volunteer reserves, join the armed forces as regulars, and rejoin the volunteer reserves when their period of duty is completed. This is a tortuous process and it can only be right to simplify it.

The employment of voluntary reservists in such circumstances will ensure more flexible use of the reserves. Importantly, it offers greater opportunities for individuals to increase their skills and to undertake a wider range of tasks. The extent of the new opportunities will naturally vary from service to service and from time to time. The Bill also creates two new categories of reserve. Part IV deals with one, the high readiness reserve. Members of the high readiness reserve would be individuals with skills in short supply in both the regular and reserve forces. They would volunteer, with the consent of their employer, to take on a higher liability for call-out. We aim for about 3,000 members of the high readiness reserve although the precise number will depend on further definition of the services' requirements. Its members would be subject to a nine month maximum period of call-out. Commitment to the high readiness reserve would be reviewed annually, allowing individuals and employers to decide whether high readiness reserve status is still compatible with their circumstances.

The sponsored reserve scheme to be created under Part V permits some support tasks currently performed by our regular forces to be let to contract. The sponsored reserve is envisaged as consisting of civilians belonging to a contractor's workforce who accept a reserve liability to continue to provide a contracted service, for example maintenance of equipment, in an operational environment. This would only be done in instances where two tests are passed: first, one of cost-effectiveness; and, secondly, one of not jeopardising operational effectiveness.

The concept has been welcomed by many employers who are keen to pursue the business opportunities the scheme would provide. I recognise that close liaison with employers and unions will need to be maintained if the scheme is to be implemented successfully. Indeed, the Bill requires formal consultation before regulations are made.

Part VI of the Bill re-enacts in simplified form the principal call-out powers of the 1980 Act. It also includes one of the most significant new provisions, a power of call-out for humanitarian, disaster relief and peace-keeping operations. This would enable the

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reserves to be a part of the United Kingdom's contribution to the relief of human suffering around the world.

Part VII re-enacts from the 1980 Act the power to recall service pensioners and former soldiers without change to the circumstances in which recall is permitted. However, there is an important change in the definition of those liable to be recalled. The Bett Review has proposed that service pensions should be paid from age 55 or 60 and not, as now, from as early as age 40. If adopted, that would significantly reduce the number of individuals liable to recall. To allow for that possibility the Bill specifies the liability to recall purely in terms of the period of service since the end of regular service without reference to pensionability. Different provisions apply to officers.

Part VIII of the Bill creates two important safeguards. The first is a right to seek exemption from or deferral of call-out, exercisable both by a reservist or by his or her employer. The second involves financial assistance to reservists and employers to cover the extra costs of call-out. Those new safeguards recognise changing employment and social pressures and the importance of the relationship between employers, reservists and the MoD. We believe that it is right to take steps to minimise any financial disadvantage suffered by employers or reservists at a time of call-out. The proposals have been widely welcomed.

A compliance cost assessment has been produced in consultation with employers and reserve units. Copies are available from the Printed Paper Office and in the Library of the House. It estimates the cost to business of the call-out of reservists for nine months average across the board at £1,900. Payments under Part VIII of the Bill are intended to reduce the average net cost of call-out to business to zero.

With regard to call-out, it was suggested at an early stage in the development of the proposals that there would be more confidence in the safeguards if the department were not seen to be acting as judge and jury in its own case. Part IX of the Bill therefore makes provision for an independent system of appeal tribunals to arbitrate in the case of dispute. It is our intention to make the tribunals informal, fair and prompt.

Part X of the Bill deals with offences. It makes the current offence of failing to attend on call-out or for training applicable to all officers and men of the reserve forces. It introduces a new offence covering relatively minor misdemeanours of reservists at times when they may not be subject to service law.

Part XI addresses the territorial, auxiliary and volunteer reserve associations and updates the existing law without any substantive change. I should like to take this opportunity to express my thanks to their council and to the individual associations for their assistance with the development of the Bill. We value that relationship and we shall continue to consult closely with them. I should also mention the support we have received from the National Employers' Liaison Committee, which fortunately does not require a further part of the Bill.

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I believe that the combination in the Bill of greater flexibility to use the reserves in a wider variety of operational circumstances, new powers of call-out and safeguards for individuals and employers will, if it is enacted, lay the foundations for vibrant and successful reserve forces into the 21st century. I commend the Bill to the House.

Moved, That the Bill be now read a second time.--(Earl Howe.)

3.15 p.m.

Lord Williams of Elvel: My Lords, the House will be grateful to the noble Earl for introducing the Bill and will commend him for the brevity and clarity with which he did so. I am afraid that I may take rather longer in explaining some of the difficulties with this Bill.

I join with the noble Earl in paying tribute to our reserve forces. As the noble Earl rightly said, they have always responded effectively to any challenge that they have been given. We are grateful for that. As the noble Earl pointed out, the Bill has been the subject of wide consultation. There was not only a rather colourful, greenish paper entitled Strength in Reserve, but also a draft Bill. In addition there has been a study by the Select Committee on Defence of another place. Therefore, we have before us a large menu of documents from which to select our comments.

I agree entirely with the noble Earl that the Reserve Forces Act 1980 is out of date. It is in that context that I wish to give a welcome to the Bill that the noble Earl has produced. Having said that, there are some points that I ought to make. There are three preliminary points, two of which I hope your Lordships will all accept, and one which your Lordships might not accept.

The first point is that we ought to be clear--and there is a great deal of defence expertise in this House--that the reserve forces, and also the cadets, are an essential means of communication between the regular forces and the general public. That role is not often recognised, but it is very important that the general public be aware of what our armed forces do. The reserve forces are a mechanism for achieving that following the abolition of National Service.

Secondly, the reserve forces become essential not only in times of war but, as the noble Earl rightly pointed out, in local conflicts where British regulars are engaged in peace-keeping activities, under whatever banner is appropriate at the time. That is equally true in respect of domestic emergencies. I support that.

The third preliminary point is perhaps a little more controversial. There is no reference to the role of women in the reserve forces. That may be a point which the noble Earl will wish to cover when he winds up the debate. We have to recognise that in the reserve forces in this day and age women are as important as men. Some of the drafting of the Bill does not suggest that.

I do not wish to dwell on matters which should be properly dealt with in Committee. However, as your Lordships are aware, this is a Bill of 133 clauses and eight schedules. Although some of those may not be controversial, nevertheless that is a lot of material for us

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to get through. I do not wish to detain your Lordships in processing this Bill in a convenient and timely manner. We want to get the Bill through as soon as possible. However, it is your Lordships' duty to scrutinise the Bill, to ask questions of the Government and to move amendments as and when we think it appropriate.

As the noble Earl pointed out, the Bill covers three major points. First, there is the question of call-out compensation and pay. That is a difficult combination involving government, employer and employee. I shall pursue this matter in Committee and ask your Lordships whether that balance has been properly struck. I recognise that it is a difficult balance; but has it been properly struck? For instance, so far as concerns employers, I have some doubts about the compliance cost assessment that the Government have issued. It seems to be based on some rather out of date information, dating from the Gulf War. It is probably inadequate in the samples that it has taken. I doubt whether employers will be fully satisfied with the compliance cost assessment produced.

Secondly, I refer to the question of female employees. We do not know--there is no mention in the Bill--what happens to female reservists who are called out. They sign the appropriate contract, but they may become pregnant. All we know is that there may be certain guarantees of continuing employment. But what are those guarantees? When a woman or a man leaves his or her job and goes to serve Her Majesty in whichever theatre it may be, what happens not simply in terms of getting that job back but as regards the ladder of opportunity which would have been open to him or her had he or she remained in the job? There are insurance problems. I tried hard to read through the material provided by the Ministry of Defence; but so far as I can see there are no insurance arrangements for women in that position. I know this from my own experience. If someone is called out and misses out on a year in his job, when he returns he might find himself rather less popular in his firm than when he left. From the employees' point of view we shall have to explore those aspects in Committee.

The third point, as the noble Earl rightly stated, is the Government's point of view. As presented, will the Bill resolve the operational issues at which it is aimed? There will no doubt be problems of recruitment both to the reserves and to the regular forces. There may well be problems of retention in the reserves and in the regular forces. There may be problems of morale, in particular in the regular forces, when they find in certain instances that they are taken over by civilians coming out of nowhere when they themselves have been doing their duty openly and faithfully. We shall have to explore all those points in Committee. I do not wish to elaborate on them here.

I am one of the few Members of your Lordships' House who was a platoon commander of a reserve platoon under the command of the noble and gallant Lord, Lord Bramall. We had a good deal of trouble at the time of Suez when the Z Reservists, as they were then known, wanted to go home. There was an emergency; they were called up; there was no emergency; they wanted to go home.

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Perhaps I may tell your Lordships the story of one of the most frightening moments in my life. As the officer on guard at the time, there was a problem in the lower barracks which I had to try to sort out. The sergeant in charge (my noble friend Lord Bramall, if I may so call him, will remember him), Sergeant Wigger, was very keen on getting the guard out and loading rifles with live ammunition. He said to me quite clearly, "Well, what we do is just shoot the reservists down. There is no problem about this". I said that that was possibly not the right thing to do. I rather quickly sent for Major Bramall (as he then was) and he of course sorted the matter out in his usual delicate, diplomatic and authoritative manner.

I turn to the high readiness reserves--new categories of reserves. There will be a problem about the contract. There will be a problem about the training necessary for high readiness reserves. I say quite frankly to the noble Earl that I suspect that we shall have to await the first major call-out before discovering whether anything that the Government have in mind will really work. You can invent things in theory, but you find out whether or not they will work when you come down to practice.

I am a little more doubtful about the sponsored reserves. The success of that category will depend on the assumption that training requirements are restricted to basic military skills, whatever those are, and tailored to meet the likely operational service of each individual contractor. I find it odd to envisage this situation. The regular forces are engaged in one of the operations that the noble Earl has described. If people come from, say, British Aerospace, Rolls-Royce or elsewhere how will they fit in the proper military discipline as explained in the Bill; and how will they come out of that military discipline and return to their original employment?

There is also a problem, if the situation arises, regarding the regular forces, given the doubts that we have expressed about contractorisation--I do not have to mention the modification of Tornado F3s by Airwork Limited. We have to be sure, as I hope your Lordships will agree, that if pilots fly an aeroplane, they are satisfied that it has been properly maintained and serviced, and that they will not fall out of the sky simply because maintenance work was contractorised. That is fundamental.

Therefore I give the Bill a general welcome; but it would be absurd to suggest that it is without problems. We shall explore those in Committee. My uneasy feeling about the Bill is that the shift of functions from regulars to reservists may well be designed to pave the way for further reductions in regular forces. In other words, we on our side will have to be certain that this is not a matter of contractorising, or even privatising, our armed forces. If that is what it really is--we shall find out about that in Committee--then our general welcome will, I am afraid, turn into resolute opposition.

3.28 p.m.

Lord Mayhew: My Lords, the final point of the noble Lord, Lord Williams, finds an echo on these Benches. The purpose of the Bill must be to ensure that in a crisis the Army can draw on skilled and trained people. It

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must not be to replace too few regulars with more reservists. We shall watch vigilantly to ensure that the purpose is not to fill gaps in the undermanned Army. The undermanning today is the worst problem facing the Ministry of Defence, and it is the Government's own fault. It arises directly from the preposterous disproportionate cut in army manpower in Options for Change. The Government's job is to increase the number of regulars now and under no circumstances to misuse this Bill by filling the gaps with reservists.

As the noble Lord, Lord Williams, gave a pleasant personal example of his views, it occurs to me that I have personal experience of filling the gaps in an undermanned Army. It has a lesson for today and if noble Lords do not object, I should like to explain why. I was a private in the Surrey Yeomanry, the first territorial unit to be sent abroad in September 1939. On call-up, we were divided into two echelons: A echelon for the trained men and B echelon for the untrained. As I had never been to camp and had spent only three evenings in the Yeomanry drill hall, I found myself not unnaturally in B echelon. However, one morning, as B echelon paraded, a sergeant major from A echelon visited us. "Hands up those with driving licences", he said. That was it. My driving licence qualified me for immediate overseas active service and before the end of September I was driving in convoy from Brest to the Belgian frontier.

When I think back to the early days of the war, I feel that it is extraordinary that we won it. Surely we must now agree that whatever else happens, we will never again permit our regulars or our reservists to go to war so shockingly unprepared as we did then. That is the spirit in which I personally welcome the Bill. There are things wrong with it and at Committee stage we shall try to improve it. However, in my judgment it is much needed. It is high time we re-jigged the reserves and high time we gave the Army the assurance that there are trained reservists available.

The Bill will give an extra edge to territorial training. The territorials will know that from now on they will have more opportunities and possibilities of using the training they receive. It may give a lift to morale in the territorials which I have to say is perhaps a little feeble today. When I say "feeble", I am thinking of the recent report of the Select Committee on Defence. We should look at the Bill in conjunction with the report. The committee had little but praise for the Bill, as indeed I have, but it shows how far we have to go before the new reserves are likely to operate as planned. The report shows a disturbingly high rate of turnover, unsatisfactory standards of leadership by officers, deficiencies in training, and evidence of excessive bureaucracy.

Unlike the noble Lord, Lord Williams, I believe that the Bill will improve those matters. I have given one of the reasons but there are others. We must realise that we have a long way to go before the aims of the Bill are implemented. In the meantime, I pay tribute to the way in which the Bill was produced. The thorough, useful and wide consultation that took place reflects credit on the Ministry planners and administrators. We on this side warmly welcome that.

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My noble friend Lord Redesdale, who is a serving territorial officer, regrets that he cannot take part in the debate today. However, he will handle all 133 clauses in Committee on behalf of my noble friends. I know that he will have a number of points to make for improving the Bill.

It is necessary that the Bill should spell out with great precision the provisions for compensating territorials for loss of jobs. The Minister explained the provisions. But how will they be conveyed on the ground? Will they be understood and accepted by the soldier? I should like to know what arrangements are being made to make sure they are. I should have thought that every single soldier would have someone sitting with him to explain how the provisions affect him. Otherwise, uncertainty and doubt may make people unwilling to accept the increased commitments set out in the Bill. I hope that the Minister can reassure me on that matter. I am thinking particularly of self-employed people. What kind of compensation will they receive for the long-running commitments they have and will continue to have after they are called up? Those commitments may be office rents, maintenance of vehicles, equipment and so on. The point needs looking into and perhaps the Bill can be improved in that respect.

As for the special reserve, surely we should welcome it. However, while those who sign up for it are doubtless well prepared to operate in a war zone, maintaining weapons systems, electronics and whatever, they may reasonably not wish to find themselves fighting in the front line. I should be grateful if the Minister would explain how limitations will be placed on the use of such soldiers in the war zone.

There are a number of other questions but they are more suitable for the Committee stage. The Bill reflects credit on the Ministry and my noble friends wish me to welcome it.

3.36 p.m.

Lord Bramall: My Lords, as president of the London Territorial Auxiliary and Volunteer Reserve Association, at this stage I wish to give a warm welcome to the Reserve Forces Bill. There are a number of points to be clarified at the Committee stage. As the Minister pointed out, the reserve forces have over the years provided a significant contribution to the effectiveness of the armed forces. But now, with the rundown of the regulars and the weaknesses which, as a result of a cumulative effect of Options for Change and the Defence Costs Study, have emerged in certain areas of regular capability, particularly parts of the combat arms and their immediate support and the medical services, that reserve force contribution has become virtually indispensable. Indeed, without it, we would not be able to provide and sustain for any realistic length of time an appropriate and fully balanced front-line capability. That is not only in fully warlike operations, but also in peacekeeping, humanitarian and disaster relief operations. That may become all too clear in Bosnia during the course of the next year.

The new provisions in the Bill give a power of call-out for the lower intensity operations, in addition to major emergencies, and also an opportunity for

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reservists to volunteer and to undertake productive tasks, including full-time service, without being called out or joining the regulars. I believe that the new provisions are necessary in the changed but still dangerous international climate in which we have to operate. As has already been mentioned by the Minister, they would save a vast amount of administrative time and effort which causes such frustration at the moment when one has to move volunteers into the regulars and then back to the volunteer reserves.

I also welcome the two new categories of reserves envisaged, particularly the high readiness reserve which would consist of individuals with skills now in such short supply in the regulars and, indeed, even in the reserve forces. There, the vital medical services--particularly in the fields of surgery and anaesthetics--are utterly dependent on the National Health Service releasing specialists at the proper time. It might be reluctant to do so for humanitarian operations and other low intensity operations. That may be a comparatively small aspect of the Bill, but it is nonetheless a very important one. In passing, I should also like warmly to endorse what the noble Lord, Lord Williams, said about the reserve forces continuing to be what is described as the umbilical cord of the regular forces to the civilian population.

If the implementation of these arrangements, now made possible by the new provisions of the Bill, is to be successful, there must be safeguards for both employers and volunteers. Three of these, namely, making up earnings, compensation to employers and the right to seek exemption or deferral of call-out or recall, are rightly written into the Bill. But it is also very important that the willingness of those in the reserve forces to increase their voluntary service in more minor emergencies must not be abused or exploited in order to save money on the regular forces. I fear that this could so easily happen. The new powers must be used only when they are specifically needed; and there must be a cut-off date for those called out when they would be able to return to their civilian employment. It should, for instance, be something like an absolute maximum of six months.

That would meet some of the problems that the noble Lord, Lord Williams of Elvel, so correctly brought to the attention of the House. Anything other than that would be counter-productive. Indeed, if it is not done, volunteers, who by and large welcome these wider powers, as do all of us who care about the reserve forces and want to see their professionalism and dedication more generally recognised and made use of, would become disenchanted. The scheme would then collapse on the altar of any further short-sighted, and at the present time dangerous, parsimony in the regular field. Subject to that safeguard, I hope that the Bill can be enacted with all possible speed.

3.41 p.m.

Lord Vivian: My Lords, I am most grateful to my noble friend for bringing the Bill to the attention of the House so speedily and early in this Session of Parliament. Before I speak further, I declare an interest.

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I hold the appointment of honorary colonel in 306 Field Hospital Volunteers. I also thank my noble friend for writing to me on 16th November emphasising the principal new provisions of the Bill.

The Ministry of Defence should be congratulated. It has presented your Lordships with a well-drafted Bill, to which I shall come in a moment. I hope that the Bill, even though it contains so many clauses, will have a quick and easy passage through this House and another place. I should think that its successful drafting was made very much easier as a result of the excellent and clearly written consultation document, Strength in Reserve. However, strength in reserve, although very necessary, does not make up in any way for lack of personnel in our regular armed forces. We must not be lulled into the false position that the armed services will be all right on the day owing to our strong reserve forces. To emphasise the point, I believe that the regular Army currently needs some 15,000 recruits if the present deficiencies are not to increase with regiments having to bear virtually impossible overstretch. I welcome this potential strength in reserve. I welcome too the fact that the consultation document achieved its three aims: to improve understanding of the provisions of the proposed legislation; to stimulate debate in advance of parliamentary scrutiny of the Bill; and to generate comments to help the Ministry of Defence to refine and improve the legislation. I recommend the issuing of consultation documents whenever possible prior to legislation being laid before Parliament. Much parliamentary time may have been saved on this Bill, especially in Committee, although there are a great number of clauses.

I now turn to the Bill itself. Overall, I believe that all seven aims, listed at paragraph 3.2 of the consultation document, have been met. As a result, the Bill will provide flexible, yet far simpler, legislation to ensure that our reserve forces are able to undertake their commitments in a timely manner and that existing volunteers and ex-regular reservists are able to elect to accept the new liabilities.

I shall now focus on several aspects which should encourage men and women to join the reserve forces and should ensure that they are able to carry out their commitments speedily. I believe that adequate safeguards have been included to protect employers and employees. I shall touch on those later.

First, I should like to emphasise some of the welcome effects of the legislation on reservists. It is proposed that there should be a new obligatory length of annual continuous training of 16 days. However, it would appear that there are no plans to change the current practice of 15-day camps. Their continuation will no doubt be welcomed by employers. Perhaps, however, my noble friend will comment in his reply on why it is necessary to legislate for the 16th day if it is not to be used.

The Bill will also permit a member of any reserve force to sign up for a period of full-time or part-time service without leaving his reserve force. Financial assistance will be available to a reservist when called out if his military salary should be less than his civilian

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earnings. In some situations deferral or exemption from call-out should be possible for some reservists should the need arise.

Reservists and their dependants should still retain some protection against eviction from certain kinds of rented accommodation while the reservist is called out. They should also retain some protection against the enforcement of an action for personal debt or for non-payment of a mortgage. He would maintain membership of certain kinds of insurance policies subject to arrears of premiums being made up in a given period. A reservist should also be allowed protection from eviction from business premises while called out. It would appear from consultation that the proposals to make payments to those whose military salary is below their civilian earnings will permit reservists to meet their civilian commitments. They have been most welcomed by employers.

In relation to pensions, reservists have two concerns. The first is that absence from their civilian employment on call-out should cause no reduction to the benefits they expect to receive on retirement or earlier transfer from the scheme. Secondly, what will be the situation relating to benefits if a reservist should unfortunately be killed or disabled while called out? I am aware that my noble friend covered some aspects of the situation in his opening statement, but perhaps he can deal with those two matters in his reply.

Last but by no means least, it is excellent to see once more that employers will have to continue to offer a reservist his or her old job, or a job reasonably equivalent to it, on return from call-out. It will remain an offence to dismiss someone for having a call-out or recall liability.

I now turn to some of the effects of the legislation on employers of reservists. What appeared in the documents I found most welcome. There are substantial improvements in the proposed safeguards for employers in the new Bill as opposed to the regulations in the Reserve Forces Act 1980. First, payments may be made to employers whose employees are called out. Secondly, if the call-out of a key employee would have a severe impact on the business, the employer will have the option of seeking deferral or exemption from call-out. However, Her Majesty's Government should also be aware of employers' sensitivities when holding reservists or high readiness reservists within their work forces. Thirdly, an employer's consent has to be obtained before an employee can take on a high readiness reserve liability.

Call-out costs to employers were discussed in the consultation document and in the Ministry of Defence compliance cost assessment dated November 1995. It would seem that it has been generally accepted by employers that call-out costs amount to the direct costs of the one-off expenses of recruitment, the ongoing cost of temporary replacement for the call-out period and the indirect administrative costs. Cost models have been drafted. Will my noble friend inform the House whether the business community is content with that assessment? There is a welcome provision in the Bill that employers will be able to appeal to a special forces appeal tribunal in the event of dissatisfaction over a call-out case.

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I now come to the two new types of proposed reservists. Until now it has been difficult and complex calling out individual reservists in a way that combines proper safeguards and incentives for both employer and employee. It is now proposed that there should be a high readiness reservist and a sponsored reservist. The high readiness reserve concept is to guarantee the availability of specialist skills, which are in short supply in both the regular Army and the reserve forces. Current estimates envisage around 3,000 high readiness reservists. Some of the types of reservist required are linguists, intelligence staff, public information officers, medical personnel, ambulance support staff, equipment technicians, air crew and special forces personnel.

It will be seen that medical personnel are specifically identified. I feel that I should once again draw that point to my noble friend's attention. The skill of surgeons will be in high demand. I am informed that there is a critical shortage of that skill within the regular Army. In fact, I believe that there is a deficiency of around 35 surgeons as some have been downgraded, some have taken voluntary retirement, and some are not yet ready to be consultants. The situation with regard to anaesthetists is equally parlous. It has been estimated that a 30 per cent. increase will be required over the next 10 years. Within the Territorial Army and reserves there is also a serious shortage of army surgeons and anaesthetists.

I am also very much concerned that the National Health Service may not allow specialist medical personnel such as surgeons and anaesthetists to leave NHS hospitals when the armed forces medical services require them. Are there any safeguards in place to ensure that those army medical specialists will be made available when needed in times of emergency? I should like to impress upon my noble friend my belief that a critical situation exists in the army medical services which requires closer examination. I should welcome the opportunity to have further discussion on the issue at a later date.

High readiness reserves would require the consent of the individual's employer. That consent would represent a strong commitment by the employer to release the high readiness reserve without protest when he was called out. Surely, that is a most welcome step, as employer, employee and the Ministry of Defence know where they stand and it introduces some stability into the system. On the employer's side, he would be able to seek termination of the agreement or exemption from call-out if an unforeseeable change in circumstances occurred. The maximum duration of the agreement would be for 12 months and successive agreements would be possible. Once called out, as envisaged at the moment in the Bill, the maximum period of service for the high readiness reserve would be nine months.

The second type of new reserve is to be known as the sponsored reserve. There will be no need for sponsored reserves to have previous regular Army or reserve experience and they will not be required to meet front line infantry standards. There are a number of support functions which could be carried out by civilians but which currently are carried out by regular military personnel. The sponsored reserve concept will permit those functions to be put out to contract by providing

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that the contractor recruits an appropriate proportion of the relevant workforce who would be willing to become members of the reserve forces.

I turn to call-out for permanent service, which is currently achieved by the Reserve Act 1980 and, confusingly, by a number of statutory instruments and orders in council. The Bill simplifies the procedures of the three systems of call-out. One permits the call-out of any member of the reserve force whenever it appears to Her Majesty the Queen that a national danger is imminent, a great emergency has arisen or there is an actual or apprehended attack on the United Kingdom. A second permits the Secretary of State to make an order authorising call-out of all officers and men of any reserve force when warlike operations are in preparation or in progress. The third type of call-out is new. It permits the Secretary of State to make an order authorising a call-out of any or all of the officers and men of the reserve forces either for operations abroad for the protection of life or property or for operations anywhere in the world for disaster relief.

This is a well drafted Bill; it is most welcome to the regular and reserve forces. It simplifies many complex and tedious regulations and brings the law on reserves up to date. It contains a new power of call-out for peacekeeping, humanitarian and disaster relief operations and provides an opportunity for reservists to volunteer to undertake productive tasks. It proposes two new categories of reserve and lays down adequate safeguards for employers and employees.

Finally, the reservist, who spends most of his time as a civilian, is a great ambassador for the Royal Navy, the Army and the Royal Air Force. In these times, when we have to survive with such small defence forces, they are able to spread the good news about our roles and the defence policies of the United Kingdom. I strongly support the Bill and wish it a speedy passage through Parliament.

3.57 p.m.

Lord Carver: My Lords, like other speakers, I congratulate the Government on the consultation process that they have carried out, which was very thorough and culminated in the extremely interesting summary of the replies that they received.

I welcome the Bill. I do so primarily because it makes it easier both for the Ministry of Defence to employ volunteer reservists more flexibly as individuals and for the reservist (him or herself) to volunteer for a period of active service with a regular unit. I am afraid that it is increasingly unlikely that units--certainly battalion-sized units--of the Territorial Army will be employed as such.

The circumstances just cited by the noble Lord, Lord Vivian, and justifying call out under Clause 55:

    "national danger ... great emergency ... or ... an actual or apprehended attack on the United Kingdom",
are difficult to envisage. Those at Clause 57 when:

    "warlike operations are in preparation or progress"
are perhaps less unlikely, if that is meant to cover operations such as the Korean and Gulf wars and the Falklands conflict. But in those events the regular forces

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should be able, as they have been in the past, to provide all the combat units that are needed. Their problem will be, as it was in the Gulf War, to find sufficient logistic, administrative and particularly medical backup and to find a number of technical specialists in various fields.

In the case of Clause 59:

    "operations outside the United Kingdom for the protection of life or property; or ... operations anywhere in the world for the alleviation of distress or the preservation of life or property in time of disaster",
the regular forces are likely to be able to find the units, but as the noble Lord, Lord Mayhew, pointed out, they could well be short of manpower. The need would be to reinforce them otherwise than by cross-posting personnel from other units. In those Clause 59 circumstances, it might well be desirable, indeed perhaps necessary, to employ reservists, regular or volunteer. But the need to do so might not appear so urgent or so desirable to the general public, to the volunteer reservists themselves or to their employers.

In the case of Clause 59, it is highly unlikely that a significant proportion of the reservists of the same unit--I stress "of the same unit"--would be willing to be called out or that their employers would be willing to let them go. But at the same time there may well be a considerable number of volunteer reservists from different units who would be willing, indeed eager, and free to be called up for nine months under the special agreement. I welcome the Bill because it makes that aspect easier.

Thirty years ago I was closely involved in a major reorganisation of the Army's volunteer reserves. It involved a severe reduction in the number of Territorial Army units and was hotly resisted by the TA associations. However, it made it possible to give the TA a valid purpose and to equip, clothe and train it more effectively. It involved a merger of the Territorial Army with the Army Emergency Reserve, which was a volunteer reserve of individuals who contributed the skills they employed in their civilian employment and trained with the regular army, and the supplementary reserve, which was another volunteer reserve which provided additional manpower to combat and other units of the regular army with which they trained.

Those reserves were extremely cheap to train and provided good value for money. That was one of the reasons why I wished to call the reorganised reserves the Army Volunteer Reserve, in line with the Royal Naval, Royal Marines and Royal Air Force Volunteer Reserves. But that was strenuously opposed by the old and bold of the TA, resulting in the awkward compromise of the Territorial and Army Volunteer Reserve, which the administration of the noble Baroness, Lady Thatcher, changed to the old name of the Territorial Army. An unfortunate result of the merger and the pressure from the TA was the virtual disappearance of those valuable and economic reserves of individual volunteers.

I am glad to say that the Bill goes some way toward remedying that situation by the creation of the special agreements and of the high readiness, and to a slightly lower extent, though not quite the same thing, the

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sponsored reserves. But in relation to the Army there is a need to go further in the direction of encouraging volunteer reserves to act as reinforcements to regular units, either as individuals or as sub-units, and to train with those regular units.

I appreciate all the arguments for maintaining battalion-sized units for the Territorial Army with their local associations, as an encouragement to recruitment and morale. But it must be recognised that their employment as complete units is highly unlikely. If the best use is to be made of volunteer reservists and if active service is what the volunteer seeks--some of the evidence shows that that is the case--even more should be done than is effected by the Bill to facilitate their employment as individuals.

My final word, which has been the final word of almost everybody else who has spoken, is that the Government must be under no illusion that this Bill will somehow make it possible for them to make significantly greater use of volunteer reserves in order to economise on the strength of the regular forces.

4.3 p.m.

Lord Craig of Radley: My Lords, I am delighted to add my welcome and to congratulate the Government on introducing this important and, many would say, long overdue Bill. The Gulf crisis in 1990-91 was a particularly sharp reminder to us all that there was much about the existing reserve forces legislation which was highly unsatisfactory. That was a widely held view and agreed across the three services, both regular and reservist, in the Civil Service and indeed among Ministers. Attempts to correct these problems before then always foundered on the grounds that it would not be possible to find the parliamentary time required to revise the existing legislation.

So many aspects needed to be put right that it was not possible to add them on to some other defence-related Bill. They were far too wide ranging and important, and they had to be dealt with on their own account. For many years therefore we were left trying to find ad hoc and temporary fixes which gave little satisfaction to regular formations or to those reservists who were needed and wished to serve in operational situations short of major war. But I do not wish to dwell on the past and our unhappy experiences with an increasingly outdated and inflexible set of arrangements. They were geared more for a World War III than anything akin to the steady stream of "unforeseen" operations with which we have been faced over recent years.

The detailed and constructive way in which the Government have sought to enlist the support and the advice of those who really know about these matters has been most commendable. Much of the Bill before us is unquestionably sound and will be a great improvement on the current legislation. I should like to raise three points, not as a critic, but in order to seek the Government's views upon them and thereby reassure your Lordships' House that they have been fully considered in the earlier work on the Bill.

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My first point relates to the defence medical services, also raised by other noble Lords. I remain concerned about the drawdowns in uniformed regular medical care, and particularly secondary medical care for trauma patients--those brave servicemen and women who may be hit and wounded on operations. I have raised my worries many times in your Lordships' House. Our experiences during the Gulf War highlighted the difficulties which the National Health Service and the health trusts faced to meet our requirements for consultants and other medical specialists. There will always be a conflict of interests, clinical as well as financial, between the military requirements and those of the National Health Service.

Have the Government thought through all the variety of operational and other crisis scenarios, both high and low intensity ones? In the Gulf War we faced the prospect of heavy casualties from Iraqi weapons of mass destruction if and when fighting broke out. It was essential that National Health Service personnel were ready in theatre to bolster the then much larger numbers of uniformed medical staffs than we have available today. Having arranged for those consultants to be there in good time, we could not say how long the waiting period would be, let alone how long the war (if and when it came) would last.

That was not a satisfactory situation for the many National Health Service patients whose treatment had to be cancelled or postponed while their consultants were in the Gulf waiting for developments but not actually working on their clinical duties. Your Lordships are aware of the considerable further reductions in uniformed medical staff which were made as a result of Front Line First.

The armed forces will be more reliant than ever on their reserve medical personnel, who will come from the National Health Service. The British Medical Association believes that serious problems remain. It is concerned that the National Health Service employers may refuse to release senior medical staff for what may be a substantial period of time.

National Health Service trusts are already reluctant to allow their key personnel the time to pursue medical military training with the reserve forces, even though that is now and will be an important entitlement in the new Bill. The emphasis on internal market competition in the National Health Service makes employers equivocal about the commitment that they must make to employee reservists for their training and operational commitments. It will not prove a good start to the new legislation if at the outset there are still uncertainties, equivocation or fudge in this key area of military need. I hope that the Minister will be able to speak on that point in a way which will reassure and convince this House that my anxieties are fully and satisfactorily thought through.

The Bill introduces the important concept of a high readiness reserve. I particularly welcome this aspect. It will add greatly to the flexibility of the reserves. But to be effective, it will rely on the consent of employers--and of course not just NHS employers. This in part will be encouraged by the power to make payments to

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employers of reservists who have been called out or recalled. Will there be flexibility to vary the size of these payments, not only to ensure that the real value of the recompense is maintained, but also to take account of the economic cycle as it affects employers?

I recognise that this may not be easy to provide for very precisely within the Bill, but it seems inevitable, as the years go by, that there will be some periods when employers will be more reluctant than at other times to release their employees. Perhaps the Minister could give an indication of what flexibility could be available in this area. The average amounts which he quoted from the compliance cost assessment strike one, certainly at first blush, as very low. Perhaps they need to be better explained because otherwise they could prove to be a very sharp turn-off to prospective employers caught up in this business. It would be a great tragedy, after waiting so long to update and improve the reserves legislation, if the new Act was to prove to be unsatisfactory in perhaps only a matter of a very few months or years.

My final point is to suggest, as I did during the consultation period, that now might be an opportunity to petition Her Majesty the Queen to revise the name of the Air Force Reserve. This body is largely drawn from the men and women of the Royal Air Force and is referred to in the Bill as the ex-regular reserve forces. Has the time not come to entitle the formation which they join after their period of regular service in the Royal Air Force as the Royal Air Force Reserve? Adding the word "Royal" to the title would, I am sure, give great pleasure and pride to those ex-regulars in their new situation. If there are good reasons why this suggestion is not a "runner", no doubt the noble Earl the Minister will be able to tell your Lordships' House.

This new Bill is a major, important and long overdue piece of legislation. I warmly welcome it, and the broad thrust of its content. I should like to feel that there are no difficulties or ambiguities left for the users of the Bill when it becomes law. I hope that the noble Earl will be able to reassure us on the points which have been raised.

4.12 p.m.

Viscount Brookeborough: My Lords, I, too, thank my noble friend the Minister for his explanation and introduction of this most welcome Bill. The noble Lord, Lord Williams of Elvel, pointed out the link between cadets, reserve forces and the regular forces. He has given me the opportunity to mention the Queen's University Air Squadron in Belfast, the only one in the Province. I understand that it is being disbanded at the end of this educational year due to the low number of cadets over the past few years and therefore problems with value for money. But the present ceasefire is already resulting in more support and a 100 per cent. increase in recruits to it since it was announced. Due to these special circumstances, would the Minister not reconsider this disbandment order? In the light of this Bill it must be right to give this air squadron a stay of execution and allow students in the Province to have the

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same opportunities as those in England, Scotland and Wales--at least to give it time to prove that in the new circumstances it can become more worth while.

I come from a background of having served in the 17/21 Lancers, then in the Ulster Defence Regiment for 15 years and the Royal Irish Regiment for two years. Three years of my time in the UDR was full time, doing a second short service commission so, although not being in the TA, I have seen both sides of the coin, so to speak. This service in Northern Ireland was operational and involved voluntary duties and all too often obligatory call-outs. It also involved a training requirement and receiving bounty.

Part III of the Bill deals with training and lays down the amounts required. I would ask my noble friend the Minister to tell us whether this obligatory training is required to obtain the bounty or whether failure to complete it results in dismissal. In addition, should this be laid down in law, or should it be more flexible, if required, and be drafted in regulations. Training should be tailored so that the performance of personnel is satisfactory to enable them to support the regulars directly with minimal additional training and time lag. Is there any provision for personnel to take a year off; for instance, on an unposted list? Through pressures of marriage, family or career this may be required, especially due to the increased commitment which the Bill entails. Having returned after a year, what would be the serviceman's status at that stage? Would he be ready immediately to go on operational call-out, or would he have to go through full retraining?

I understand why there should be "special" agreements for the HRR and for sponsored agreements, but I feel that all reserve forces should have a commitment to some period of operational duty during their service, outside duty required in times of war. Those without any commitment cannot be deemed as being really cost-effective today in the post-Soviet threat era. I do not go along with the comment in paragraph C22 of annex C of the MoD's summary of comments which refers to the expansion of the role of the reserves. In it two serving volunteer reserve officers say:

    "If these proposed changes in legislation are made, you may be surprised how many of the silent, patriotic majority will leave the reserves as soon as their current terms of service change".
I believe that the new expansion of role is very important and I do not believe that the above comments reflect the mood of many soldiers in the Territorial Army.

I welcome the provisions in Part VIII of the Bill for safeguards and compensation for both employers and employees. Can the Minister tell us whether compensation will also apply to extended training periods outside of call-out of up to 16 days? I ask this question from my own experience in Northern Ireland. If an employer has many reserve force members--and they do tend to join in groups of friends and workmates--he may be reluctant to allow many of them off at once. We sometimes had this problem even with Civil Service employees--after 25 years of co-operation. We are not talking about a short term

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measure. We are talking about this going on, presumably, until we have another Reserve Forces Act or whatever in many years to come.

There are also cases where servicemen and women may have to pay out more to replace themselves than they earn during their absence on, for instance, training. In our case this happened with the self-employed. The problem arose especially where farmers had to pay a relief dairy herdsman much more than they themselves received for a week's training. It became a problem not of their employers letting them off but a purely financial problem of how they could possibly be away. Having said that, I support the length of training. It is important that it should occur.

Finally, much as there is a great deal of support for the Bill, I hope that those giving the new commitment--employers and employees--fully understand that a great deal may be required of them. The present lack of recruits to the regular forces and their increasing role world wide will result in a significant increase in the demand for reserve forces to support the regulars. I welcome the Bill. I hope that it has a virtually trouble free passage and that some of the amendments may go through.

4.20 p.m.

Viscount Ridley: My Lords, it is nearly 50 years since I joined the Territorial Army and about 30 years since I retired from it and started speaking in your Lordships' House on the subject of reserve forces. Each time I hope that it is the last time that I do so, which is no doubt a sentiment which your Lordships would share. But I only do so because I am sorry that my successor as President of the Council of TAVRAs, the noble Lord, Lord Younger of Prestwick, is unable to be here today. I see from the newspapers that he is arguing the case for lower taxes on whisky; a most important subject. May we all wish him the very best of luck in another place this afternoon!

Along with others, I welcome this Bill most warmly. It has been needed for a long time and I am delighted to see that it is launched here. We wish it the fastest possible progress. Because of the very extensive consultation process which has been undertaken, it should have a smooth passage. I cannot ever remember when those likely to be affected by a Bill were more thoroughly consulted. This seems to me to be a valuable exercise which perhaps could be applied in other fields. I heartily congratulate the Government on what they have done.

It is especially important, now that the Army is so much under strength and over-committed. Indeed, the current Bosnian settlement may make that situation even worse. The noble and gallant Lord, Lord Bramall, spoke in dramatic terms in the debate on the gracious Speech about the strength of the Army at the moment. It was powerful stuff. The ability to use the reserves more effectively and more quickly must be right even if it is no long-term solution to the Army's recruiting problem. As regards that problem, may I be allowed to ask that the contribution of the Army Cadet Force, which we referred to in a debate here last year, will not be

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forgotten? I recently had the pleasure of meeting a large number of cadets voluntarily undergoing training in Germany this month, every single one of whom wanted to join the Army when he left the cadet force. One of them said that he did not know a boy in his unit who did not. So let us not forget them.

I must, however, sound a note of warning to an overstretched Army command structure. The Territorial Army will not continue to be available if it is treated only as a reservoir of part-time regulars. It relies on the goodwill and enthusiasm of a hard core of people throughout the ranks who lead the many who only serve for short periods. If we are to use the reserves full-time we must give them enough training days to reach the standards which will make them confident of their ability. They are at the moment about 30 per cent. of the strength of the Army and they may be asked to increase their productivity--I am not sure that that is the right word, but I am sure that your Lordships will know what it means. All they ask for is a 10 per cent. increase in the present allocation of training days, which will restore the number to what they had only a few years ago. The TA is already providing excellent support for the regular Army, but to starve the reserves of such resources is bad for them, bad for the Army and bad for the country. It could negate the point of this Bill and the savings are negligible.

As regards the Royal Air Force, the new Bill offers the opportunity for the Royal Auxiliary Air Force to serve in a much wider capacity than hitherto. Its members served in the Gulf War with great distinction and will welcome the chance to participate in peacekeeping, humanitarian and disaster relief operations, which are roles that are denied to them under the Reserve Forces Act 1980. The RAF is committed to a full integration of its regulars, reserves and civilians into a total force, and this Bill will give them the tools which they need to be as flexible as possible when dealing with the variety of challenges faced since the end of the Cold War.

I turn briefly to some of the points of the Bill. I am particularly glad to see the power to call out reserves for disaster relief, which is something that I have argued for here more than once in the past. I believe that they are uniquely placed to help. They have a network of centres, communications, vehicles, all backed by local knowledge, as indeed they have often proved in practice. Lockerbie springs to mind.

Particularly important are the safeguards built into this Bill; for example, that the personnel called out will not suffer financially. That is absolutely vital. It is not going to be easy. In the Gulf War some reservists who volunteered did not get paid anything at all for some weeks and one distinguished surgeon whose skills were absolutely vital, earned much more than a lieutenant-general--and rightly so, may I say! It is therefore very important that we get this right.

In that connection I would like to make a special plea for the unemployed. Many TA units have a very high percentage of men on the dole, particularly where I come from. It is likely that many of them will volunteer to be called out, and why not? They have not a lot else

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to do. There have been persistent problems for many years when they returned from their training, such as delays in payment and so on. Although the state must not be expected to pay them twice for doing one job, it has a responsibility to see that they do not suffer hardship when their services are required. I ask the Government to look carefully into this matter in case problems arise. They have been very unpleasant in the past. I do not know whether the replacement of unemployment benefit by jobseekers' allowances makes it easier or not. I hope that we can address that problem.

Equally important to reservists--perhaps even more so--is job protection. Again, it is not as easy to do as it sounds. I believe that it is covered by the little-known Reserve Forces (Safeguard of Employment) Act 1985. I hope that that is adequate. It is difficult to know what else we can do, but extensive use of this part of the Bill may put a strain on the whole system.

For employers, the new powers to compensate them are of course a breakthrough and a very welcome new departure. I am afraid that I am too stupid myself to understand a single word of the compliance cost assessment document and nobody can really tell how much it will cost or be used, but let us hope that it works. It will go a long way to reassuring employers that they will not suffer should they employ reservists. It is important that we who are involved in these matters should listen most carefully to the employers in operating the system. The rights of appeal are of course extremely welcome as well. At the same time I wonder whether the principle conceded here might extend in due course to other areas; for example, used as a precedent to compensate employers whose employees are serving as justices of the peace. Let us hope that that does not become too much of a problem.

The final point I make concerns the TAVRAs, the Territorial Army and Volunteer Reserve Associations. Clause 120 of the Bill says that the Defence Council can alter the area or "wind-up" a TAVRA. They are of ancient lineage (1908) and I believe that they have served the country and the reservists very well. There used to be one for each county, but now they are down to 14 for the whole of the United Kingdom. Persistent efforts are constantly being made to reduce that number from 14 to something smaller, but to do so would save very little and only de-stabilise a very successful set-up. I believe that they have a vital role to play in this Bill, especially in selling its contents to employers. As other noble Lords have said, they provide a voice for defence throughout the length and breadth of the country.

I know that Clause 120 only repeats the provisions of the Reserve Forces Act 1980. I wonder whether the Government might consider a process of statutory consultations, as they have shown that they can do so well elsewhere, making the decision to alter them political rather than a military decision to alter the status quo.

Finally, the Prime Minister's generous reference to the reserves in the debate on the gracious Speech in another place was especially welcome. His endorsement of the value of the reserve forces will give great heart

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to those who read it and to those who serve in them. I hope that his words will help to speed this Bill through both Houses of Parliament.

4.27 p.m.

Viscount Allenby of Megiddo: My Lords, I begin by apologising in advance because I may not be able to stay for the winding-up speeches due to a longstanding speaking engagement later this evening. As I believe most speakers have already indicated, this Bill is important and it has been widely welcomed throughout the reserve forces themselves, by employers, employees and throughout the country. Importantly, the Bill gives even greater acknowledgment to the role of the reserves. Particularly welcome is the tripartite relationship between the Ministry of Defence, the reservist and his or her employer. However, here I should like to sound a word of warning. There is a view that this Bill could enable the government of the day, of whatever colour, to disregard unreasonably the interests of both the employers and employees to suit their convenience rather than the needs of national security. There is a need to provide adequate safeguards in that respect.

The reserves themselves welcome the new opportunities provided by the Bill and accept that there will have to be changes in order to adjust to the new opportunities provided thereby. Currently there are a number of factors adversely affecting the recruiting of our reserve forces. There is a general lack of understanding of the importance of defence; lack of money for advertising and the starvation of man training days, which has already been mentioned earlier today.

As we have read in the press recently, the regular forces and, in particular, the Army, are very under-recruited. More and more, the day-to-day needs of the regular Army can be met, largely by younger members of the reserves. The average age of the Territorial Army recruit is currently 23½ years. A higher proportion of people younger than that is now needed.

Clause 24, which deals with the agreement to undertake full-time service, is particularly welcome. The purely voluntary nature of full-time service under the clause needs to be positively advertised. With the need for some 20,000 recruits each year for the Territorial Army alone, there is an urgent need to boost recruiting funds which are currently worth less than half of their buying power of six years ago when recruiting was much easier. Here I should like to pay a brief tribute to the National Employers Liaison Committee for its work in promoting the territorial forces and for its positive response to this Bill.

There are significant numbers of people in this country, mainly in the younger age group, whose occupations are such that they can willingly undertake a period of full-time service to the benefit of the country, for their own development and for their future employability.

The volunteer reservists feel strongly that when the Ministry of Defence has an essential need for reserves, they should be called out rather than be asked to volunteer for a particular commitment. They should not

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be forced into a crisis choice of loyalty between their service and those close to them in civilian life. "Essential need" marks the difference between such call-out as in Clause 55 and the merely "useful" circumstances of Clause 24. That could lead to some blurring of the division between the two and the MoD not wishing to impose call-out on small numbers who may face special hardship as a result. The "Special Reserve" list may well prove useful in identifying people willing to be called out in that way, but unfortunately the system is unlikely to meet all the demands of the Territorial Army.

Guidance will be needed as to how the regulations will address the problem of limited call-out, coupled with fair treatment for those who might suffer significant hardship. When the Falklands conflict and the Gulf War took place, a threshold point was reached and the whole nation felt that we were "all in it together". During both conflicts a great many reservists were involved and there was general disruption to life and to the whole basis of financial security. Below that threshold is when reservists are used for such operations as flood relief and fire fighting, which do not capture the public imagination, and it is then a different scene altogether. In those instances, the nation is getting defence on the cheap. It is at that point that employers would have a legitimate complaint if the Government were to fail to compensate those who bear the resultant hardship, if and when the hardship is enforced.

Clause 85 allows for compensation for loss of earnings. Here, no firm limit should be set and compensation should be such as to prevent undue hardship resulting from all kinds of genuine financial burden. The following clause, Clause 86, provides relief of hardship for employers. Compensation should be paid on a basis so designed to make good any costs which the employer would have been likely to incur if the employee had been absent. An assurance should be given that all reasonable costs will be met without undue delay.

By far the hardest relief to determine is that for dependants covered by the Bill. Here, the principle that life should continue as near normal as possible should be given as an assurance. Welfare staff will be needed to assess family needs.

It may appear a somewhat trivial point, but I should like briefly to mention Clause 113. I find it somewhat archaic that the Royal Navy and the Royal Marines Reserve should be on a different footing from the other two services. That seems illogical and is an anachronism that should be eliminated before the Bill becomes law. The Minister may wish to comment on that. Other points need to be addressed at Committee stage, to which we all look forward, but I shall not detain your Lordships any longer.

This is a good Bill, widely accepted by the reservists themselves. If it is to be fully effective, it needs safeguards to be built into it. Above all, it must be adequately funded and resourced. We have very fine reserves who are capable of doing a good job and of doing it well. They cannot be asked to do more and at the same time to take their share of the cuts. There is

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no fat. If the reservists do not like it, they can leave and may well do so if we, your Lordships' House, do not get it right. I strongly support the Bill.

4.35 p.m.

Lord Lyell: My Lords, today is a rather special occasion and not just because of the Bill we are considering. This is the first occasion during my career in your Lordships' House that we have had not one, not two, but three noble and gallant Lords speaking. That shows the importance of the Bill and, above all, the way in which its importance is recognised by those three noble and gallant Lords. It is a fortunate occurrence for somebody like myself speaking from the Back Benches because I suspect that I have less military experience than any other noble Lord who has spoken since I am only a National Serviceman and my service was terminated early--thanks to a skiing accident--and I served only 18 months, not 24. It is with that brief experience in mind that I rise to address your Lordships.

I began by regarding the Bill with mild interest, but that interest has grown over the days. I have young neighbours in Scotland who are keen and professional members of the reserve forces. My views on the Territorial Army and the reserve forces have been gained by listening to others in your Lordships' House, but I was startled to discover the standard of training and professionalism of those young members of the reserve forces. I now know what they do, what they are expected to do and, above all, the fact that they undertake far more than the obligatory minimum training of 16 days, to which my noble friend Lord Vivian referred. I was startled to discover the amount of time and effort that members of the reserve forces put into their training. It is astounding. My neighbours are a young, newly married couple. They have already spent 12 weeks in the recruits class where they trained in all the essential infantryman's skills to a professional standard. They have a weekly training night. I understand that six weekends of training are required of them, together with attendance at the obligatory annual camp. Furthermore, those young people, together with their unit, train every other weekend. That is the level of commitment they regard as necessary.

They call themselves "combat medical technicians". That is no mere sergeant-speak or gobbledegook. That is what they do. My noble friend Lord Vivian said that he is honorary colonel of a field hospital volunteer unit. Those young technicians explained to me that not only do they have those technical skills but that their employment does not cover them for the particular technical skill that they use as members of the reserve forces. They have acquired a great deal of specialised medical knowledge and they know how to apply it. Above all, they are expected to carry out those duties in combat, under threat, under stress, and in great danger, and I have no doubt that they would do so if required. I became far more aware of the contents of the Bill having spoken to, among others, those two young members of our reserve forces.

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Perhaps I may now ask my noble friend a number of questions. Some are serious, but one or two are raised out of pure curiosity. Are the special agreements detailed in Part IV a new provision? Or does the Bill consolidate a practice that has arisen over the years? I am particularly curious about Clauses 55, 57 and 59 in Part VI. I am pleased that the powers in Clause 55(8) will be used only in exceptional circumstances. I am pleased too that Parliament--that is, your Lordships' House and another place--will be informed and will be able to discuss the call-out, if required. That indicates the gravity of such a situation.

I am somewhat curious about the phrase "warlike operations" in Clause 57. I am assured that the words come from the Reserve Forces Act 1980, but I have not been given a definition. However, if that Act has managed to look after and to regulate all the interests of our reserve forces, I am sure that the provisions are perfectly satisfactory. Perhaps my noble friend will tell me, in writing if necessary, what are "warlike operations". They may mean one thing to the Secretary of State but something else to us.

I am encouraged to see in Clause 59 the references to disasters. That was a point touched on by my noble friend Lord Vivian and others. Perhaps I may ask my noble friend and noble Lords to glance at Part X. Your Lordships will see from the explanatory memorandum that Clauses 97, 98 and 102 create offences. That indicates to me something new and not merely consolidating offences created previously in relation to reserve forces and the TA, let alone the regular forces. No doubt, the proposal is necessary and has been examined by my noble friend and his department.

Clause 102 is interesting. It provides for "a person"--not a serviceman, but a civilian; it might be anyone in your Lordships' House--who,

    "by any means whatsoever procures".
That is paragraph (a). Paragraphs (b) and (c) give two references to "knowing" that a person is a deserter. The clause refers to any person. It could refer to a civilian if necessary. It might be that in my neck of the woods--well known to my neighbour the noble Lord, Lord Mackie of Benshie--one might find young men or young women in need of shelter. One might be able to give them a lift in driving rain or inclement conditions. If they are absent without leave or in breach of the Bill, which I hope will become an Act, what is meant by "knowing"? Am I supposed to know? Am I helping them in any way? Perhaps my noble friend can explain. Clauses 97 and 98 clearly refer to members of the forces. Clause 102 refers to,

    "A person who ... by any means whatsoever".
The provision might not necessarily bite on me or any civilian, but it just could. I hope that my noble friend can reassure me on that point.

I scanned the Bill and thought that there was nothing to be particularly worried about until I found that Clause 122 was headed "The lieutenancies". I have heard of a geographical area in Nottinghamshire called the Dukeries, so I thought it worth examining the clause. Schedule 6 refers to lords lieutenant, deputy lieutenants and vice lords-lieutenant. This is

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where I have to declare an interest. I have the honour to be a deputy lieutenant for the County of Angus. I was a bit startled, because to my knowledge no one had ever explained to me that I might have any responsibility under, or have anything to do with, the Reserve Forces Act 1980. However, my worries could pretty well be redeemed, because noble Lords will see that almost the whole of the Reserve Forces Act 1980 is repealed by the Bill. No doubt I shall be able to check that. I hope that my noble friend will be able to confirm that the relevant sections of the Reserve Forces Act 1980 (Sections 130 to 138) will continue to bite.

I conclude by thanking my noble friend the Minister for presenting and explaining this comprehensive, detailed and exhaustive Bill. It is not just necessary; it is welcome. When thinking of each and every member of the reserve forces I am reminded of Mr. Rudyard Kipling and, Thank you, Mr. Atkins, when the drums begin to play. That is true. We think of each and every member of the reserve forces today, and if there is anything that we can do to support the Bill we should do it.

4.45 p.m.

Earl Attlee: My Lords, I too am grateful to the Minister for the way that he introduced the Bill. As many noble Lords have already pointed out, it has been some time in the gestation period. That is no bad thing. It is testament to the thorough consultation that has been undertaken.

I believe that there are only two people in this Parliament who serve in a volunteer unit. They are myself and the noble Lord, Lord Redesdale. I therefore have to declare a direct interest in the Bill.

The vast majority of the volunteer reserve forces is made up of the Territorial Army. I hope that your Lordships will forgive me if I use the term "TA" to include all forms of volunteer reserve forces. Likewise, I recognise the great contribution women make in the TA. The noble Lord, Lord Williams, will be pleased to hear that my wife's TA career is somewhat more meteoric than mine as she already commands a TA recovery company.

I believe that I speak for all members of the volunteer reserve forces when I welcome the Bill positively for the reasons that the Minister and other noble Lords have already covered. The high readiness reserve and the sponsored reserve do not have my full support, and I shall explain why later.

I returned to the UK last Sunday only to find this important debate scheduled for today. I have not had the time to study the provisions for deferment or exemption of call-out, but I am worried that they may be too lenient. They might allow volunteers, or potential volunteers, to think that they can escape call-out. The financial arrangements are welcome and appropriate.

The TA's role now is to be a general reserve for the regular Army. I am not sure what is the difference between that and its previous role. However, the TA clearly provides a basis for expansion of the regular

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Army and fills up the order of battle of a regular Army unit. For instance, many regular logistics regiments have whole transport squadrons that are TA. Indeed, I used to serve in one.

As the noble Lord, Lord Williams, said, the TA also provides a link between the regular Army and the civilian world. As the regular Army becomes smaller, that aspect will become more important. There seems to be a policy that every town should have a TA centre. That has placed great constraints upon the ability of the staff to plan the reorganisation of the TA. The TA is required to help provide the defence of the nation. It is not to provide everyone who wants it with an interesting and rewarding hobby. On that point, the TA must not be regarded as a hobby that is provided at the MoD's expense. Do we need to aim for a TA centre in every town?

I should like, as other noble Lords have done, to refer briefly to the compliance cost assessment report. It appears to be optimistic in calculating the amount of time a business would have to spend on extra administration for the high readiness reserve. It suggests that one hour extra per year would be required for administering a volunteer. That is optimistic. However, whatever the costs, it would probably be worthwhile for the employer because of the other qualities of a TA volunteer.

The current cost assessment calculation of the number of work places affected by call-out is more objective. It is obvious that a 'flu epidemic would have a much more adverse effect on businesses than would a limited call-out. I doubt very much whether the NHS would recompense employers for the associated costs of a 'flu epidemic.

As I have said, I have just returned to the UK, but it appears that the military commitment to the operation in Bosnia is to be enlarged. As an excessive proportion of the regular army is already involved in operations, it is clear that some use will have to be made of the TA.

However, some of the paperwork that I have seen appears to be rather muddled. So far as I can see, a volunteer can agree to be called up and have his employment protected. The snag is that the volunteer needs to talk first to his employer, before he knows whether or not he will be accepted for service. The volunteer should be able to go to his employer and say, "Bad news, boss. I have been called up as I am one of only five qualified operators of the 'FV536 widget blaster'. You will realise that you will have to keep my job open for me on my return, but the MoD has a compensation scheme which should defray the costs. I have some literature from the MoD which you may find useful". That is why we need this Bill, and it should go a long way towards meeting the volunteers' aspirations.

As I said, I do not share the enthusiasm of others for the higher readiness reserve concept. Employment decisions and decisions to release volunteers for training are made at relatively low levels in an organisation. Those decisions are likely to be affected by the advent of the HRR. The decision makers will fear that the volunteer will always be leaving at no notice in order to go on some obscure operation.

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According to the Minister, a further definition of the services requirement is needed. I translate that to mean that we do not know what we want the HRR for, but we do want it. Another difficulty is that it could be divisive among the TA in general. Of course, it is important to keep the problem in proportion because there should be only about 3,000 HRR volunteers.

Mention has been made of the requirements of medical specialists. But to be quite blunt about that, there are already some very short commissioning courses at RMA Sandhurst and other establishments which last for two or three weeks. It would be unlikely that a consultant surgeon would have the time or the inclination to join the TA. That fast-track route might be a better route in practice, and I believe that it is already available.

I also have great reservations in relation to the sponsored reserve. The purpose of basic military training is to ensure that a soldier will perform in a disciplined, obedient and predictable manner in an operation. It is quite clear that the training proposed will be extremely rudimentary for a sponsored reservist. It is not unusual to have emergencies or disasters well behind the front line. Officers and NCOs will expect instant obedience in such circumstances. I foresee disasters occurring if people in uniform do not do as they are told or are expected to do.

A further problem is that sponsored reservists will not be true volunteers in that their service is linked to their main employment. My fear is that some will become sponsored reservists for entirely the wrong reasons.

It is certain that the TA will be involved in operations. That will have two effects on manning in the TA: those known as bounty-hunters will leave; and those of a better quality who are more adventurous will be able to volunteer for an operational tour. That will enhance the morale of the parent unit.

In principle, I welcome the Bill and look forward to its later stages.

4.54 p.m.

Lord Judd: My Lords, at the outset, perhaps I may draw attention to what I thought was an extremely interesting proposition made by the noble and gallant Lord, Lord Craig, that the Air Force Reserve should become the Royal Air Force Reserve. I hope that the Government will take seriously that suggestion and will look at it.

It has become very clear during this useful debate that there is a great deal of goodwill towards this legislation and a good deal of commendation for the detailed consultation which went into it before it was put before us. But as my noble friend Lord Williams made very clear, in Committee we do not intend to gloss over such an important matter. The Bill has 133 clauses which will have to be considered very carefully indeed. But I assure the Government that everything that we do in Committee will be designed to help the Government to achieve their objectives, which we largely share.

In saying that, the noble Lord, Lord Mayhew, underlined the complexity and the need for individual reservists almost to have somebody standing by them

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talking them through the implications of the legislation. I believe that there may be room for still further clarification.

The noble Viscount, Lord Brookeborough, and the noble Lord, Lord Vivian, with all their experience, rightly drew our attention to the importance of preserving and looking to the special needs of individual reservists. The point about farmers and the income implications for them was a very useful illustration of the sort of detail which needs attention.

At the conclusion of this useful Second Reading debate, it is perhaps just as well to pause for a moment or two to take stock of the role of the reservists in the context of the changing role of the UK armed services as a whole.

It seems to me--no doubt the noble Earl will correct me if I am wrong--that there are three principal tasks confronting the armed services today. The first is to provide forces for a large number of frequently critically important low-level operations; for example, peacekeeping and peace enforcement tasks in Northern Ireland and Bosnia. Those forces are infantry and personnel-intensive but also require special skills ranging from skills in engineering to civil relations. Indeed, new demands are all the time becoming clear as older demands fade.

Those demands take up a larger proportion of the Army than before, partly because the Army as a whole is smaller but also because of all the additional UN tasks that it has to undertake. Unlike the past, most infantry are needed all the time and not just in the event of a major war.

Secondly, it seems to me that the armed forces provide a relatively small ready force for high technology, mechanised warfare as part of a NATO\UN coalition for operations such as the Gulf War or the heavy element in the current Bosnian deployment. That element needs to be ready for rapid mobilisation.

Thirdly, the services provide for the possibility of contributing larger mechanised forces in the event of general war. Because such an eventuality is now unlikely to come without positive indications over an extended period of time, it is clearly not the best use of resources to maintain regularly-manned units for that purpose alone. Rather, the challenge is to maintain the capability for effective reconstitution over a reasonable period of time.

In considering this Bill, it seems to me that the Government are in line with such an analysis by the way in which they are increasingly shifting reserves from the first to the third role. That is evidenced by the reduction of reserve infantry battalions from 41 in 1991 to 29 by 1997; and by the increase in the number of armoured squadrons from 17 to 22. That is a trend which is probably worth encouraging.

During the Cold War, many reserves were infantry assigned to the protection of key UK bases in a general war. But their role in the on-going peacekeeping tasks of the infantry today is less self-evident. Indeed, many volunteers, although keen to make a contribution, simply do not want to become full-time soldiers. That is why it makes sense to switch the reserves, as it seems

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to me the Government are doing, into the third role that I described. If--God forbid--the threat of general war were to return and if, for example, a president Zhirinovsky were to march into Poland, then those reservists could make an invaluable contribution by helping to hold the front as new regular recruits were trained and defence expenditure expanded. Having the reserves available for that role, while some residual anxiety remains about the possibility of a new Cold War, makes a lot of sense. Incidentally, it is very much in line with the German approach, where most of the tank regiments are "cadreised" to be filled by reservists in the event of crisis.

At present, regular armoured units are constantly being retrained to fill gaps in the infantry--where the biggest demands are in Northern Ireland--and the process leaves a lot to be desired. Using reserves more for armour helps open up the possibility of converting some armoured units into infantry units. The logic of an increasing use of reservists for the armoured role--and one which the Government would arguably do well to accelerate--is that it could over time help to reduce the undesirability of using armour and artillery forces for tasks for which they are not trained or equipped to undertake.

I can quite see that there may well be an understandable reluctance in armoured regiments to become infantry. In terms of morale and esprit de corps, it would be foolish to treat that lightly. However, I wonder whether this is not an area of savings already being lined up by the Ministry of Defence as it faces further budgetary stringency.

As the Defence Committee in another place reminded us, the proportion of recruits in the Territorial Army at any one time is approximately 25 per cent. Quite a challenge! Nevertheless, some units are outstanding and excellent, and all should be helped to reach the standards of the best. That is essential if they are to be up to the demands of a general war situation.

However, there are also more immediate demands on the reserves. There is the growing role in specialist areas like engineering and medicine where there is a very real need in peacekeeping, peace enforcement and humanitarian support missions. Indeed, it is no exaggeration to suggest that the greatest day-to-day requirement for the reserves may be in those professional support roles. The noble and gallant Lord, Lord Bramall, spoke of their indispensability in that respect. Hence, as the noble and gallant Lord, Lord Carver, put it, the welcomed significance of the high readiness reserve and of the sponsored reserves, although the morale pitfalls of a two-tier system must be avoided. I noted that the noble Viscount, Lord Ridley, spoke sternly about that fact.

The Government are to be commended on having stood firm on the principle that the United Kingdom, as a member of the international community--and, indeed, one with special responsibilities for leadership as a permanent member of the United Nations--must take those wider roles as an essential element in future defence policy. Of course they are right. In a highly interdependent world, talk of self-contained British interests and defence tasks is dangerous nonsense. It has

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to be confronted. In fact, it is likely that the wider roles will be a positive attraction among more imaginative, potential service men and women, not least for the reserves.

However, here we come up against the limits of market economics out of control. As persistent and well-applied questions tabled by the noble and gallant Lord, Lord Craig, have revealed--and he made the point again today as, indeed, did the noble Lord, Lord Lyell--there is a grave shortage of medical personnel. I find it disturbing to hear the estimate of the noble and gallant Lord that it could have been catastrophic in the Gulf War had the most sinister weapons been deployed against us. That shortage is aggravated by the excessive market systems which have been introduced into the National Health Service. Where are the margins to enable hard-pressed civilian and medical professionals to redeploy for military purposes? The armed services themselves have been stripped almost to the bone. In the days when quality of medical service rather than market ideology predominated, there was more capacity for mutual support with civilian medical staff more able to move to the services and, indeed, with service personnel and facilities more able to supplement the NHS--a support role which, incidentally, since it has been drastically curtailed, has left some civilian communities much worse off for medical services.

The problem does not relate only to the medical profession. Indeed, in the entire realm of the availability of reserves, the inadequacy of the market may be about to be revealed. Do the Government really intend to pay the price necessary in each instance to persuade each employer willingly to release key personnel? Of course not. There will be a rational reliance on the volunteer spirit of the personnel themselves and on legal requirements on behalf of society as a whole. It is an excellent example of how good government, as has always been the case, is about the balance as regards market disciplines, motivation and intervention for the common good. That is why we need to know a good deal more about exactly how the objectives of the Bill will be fulfilled in this market age. On my reading of the Bill, it is really not altogether self-evident. In that respect, I believe that the observations in today's debate by the noble Viscount, Lord Allenby, should be taken seriously as, indeed, should those just made by the noble Earl, Lord Attlee, in his interesting speech.

It would be quite wrong to conclude without paying tribute to the enthusiasm, professionalism and goodwill of so many in the volunteer reserve forces. That sentiment was echoed today from all parts of the House. I can vividly recall the visits that I made to reserve marines and reserve ships at sea during my very interesting time as Minister responsible for the Navy. Indeed, from time to time, I still proudly wear--although I must say not today, unfortunately--ties presented to me on just such visits. In a decent, vibrant democracy the role of voluntary reserves, as my noble friend Lord Williams and the noble Viscount, Lord Ridley, reminded us, is to form a link between the services and society as a whole. That is crucially important.

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We want to make it plain that we on these Benches fully endorse the objectives of the Bill in endeavouring to spell out a more clear cut and meaningful role for reserves in the future. As I said at the outset, our efforts in Committee will be to strengthen the means available to fulfil those purposes. But, as we said in the recent debate on the gracious Speech, above all, there is a desperate need for a far more imaginative, challenging and coherent presentation by government of what they see as the overall purposes of defence in the millennium ahead. It is that, above all else, which will help to build the morale and commitment, which will provide the good quality recruits, upon which and whom in the end the services and the nation must depend.

5.8 p.m.

Earl Howe: My Lords, I listened with great interest and care to all the contributions in today's debate. Your Lordships have ensured, as I have come to expect, that the debate has been both well-informed and perceptive. I am grateful for the universal welcome that your Lordships have given to the Bill. As I bring the debate to a conclusion, I take great pleasure in recalling the fact that, in the short time that I have been in office, I have seen our reserves training hard at home and with our NATO allies overseas. I know that they are held in high esteem both at home and overseas. I hope that noble Lords will understand if I do not, in the time remaining, respond to all the points that have been raised. However, I shall ensure that the points I do not cover are answered in due course. The debate has traversed a great deal of ground, as is appropriate to a Bill of this length.

Perhaps I may start with a general concern. The noble Lords, Lord William and Lord Mayhew, together with the noble and gallant Lord, Lord Bramall, expressed anxiety that the Bill may be designed, or at least used conveniently, to plug any gap which may occur in the strength of our regular forces. Indeed, the noble Viscount, Lord Ridley, echoed that point. It may be helpful if I clarified the Government's position. We continue to rely on the reserve forces to provide a substantial contribution to the defence of the United Kingdom. That, I believe, is right and proper. Every other major nation is in the same position. As we must have reserves in any case, it is cost-effective from time to time to use them for less serious crises. That use is welcomed by the reserve forces themselves, permitting them to make use of their training in a thoroughly constructive manner.

The regular forces are established at a strength to enable them to meet their peacetime commitments. When unforeseen circumstances stretch their capability, the use of reserves allows operations to be undertaken and sustained without unacceptable disruption to existing essential activities. The powers in the Bill set in place a long-term framework for the reserves of all three services. They bring the existing law on reserves up to date. The general principles were set out in an open government document as long ago as March 1992. It is quite wrong to suggest that the Bill is a response to a short-term recruiting problem in the regular Army. Nor is the Bill designed to provide, as some noble Lords have put it, defence on the cheap.

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Let me say to the noble and gallant Lord, Lord Bramall, and to the noble Viscount, Lord Allenby, in particular, the call-out of reserves is rightly to be accompanied by schemes to make payments to individuals and employers who would otherwise be disadvantaged. This means that to rely on called out reservists in place of regulars will certainly not be cheap. If reserves were substituted for regular soldiers in large numbers for appreciable lengths of time, the sums would look far from happy.

In the regular forces it is true that currently there are manning shortfalls, principally in the Royal Armoured Corps, the Royal Artillery and the infantry, because of recruiting problems and inadequate retention of young soldiers. We are addressing the shortfalls with a vigorous recruitment campaign and have introduced a re-engagement bounty to improve retention. In addition we plan to use some 400 Gurkhas, who would otherwise have been made redundant, in under strength units. It is worth my making the simple point that the numerical strength of the Army should not in itself be regarded as the primary measure of front line strength, though clearly it is an important one.

Many noble Lords, including the noble Earl, Lord Attlee, referred to recruitment and retention in the volunteer reserve forces. The volunteer reserve forces have been structured to meet the post-cold war operational requirements. This has inevitably led to smaller establishments, reductions in strength; an easing in the recruiting effort, and perhaps some uncertainty about the future. Restructuring, on the other hand, has now brought exciting new roles which form a sound basis for future recruiting. We believe that the enactment of the Bill, giving greater opportunities for the volunteer reserves to put their training into practice, will lead to improved recruitment and retention. The noble Lord, Lord Mayhew, saw as one of the benefits of the wider range of operational circumstances in which reserves may be able to serve, that this will add an edge to their training. I very much share the noble Lord's view. We also believe that the provisions in the Bill will lead to better motivation of reserves through their more flexible use.

I turn now to some of the detailed points and questions posed by noble Lords. The noble Lord, Lord Williams, expressed doubt about the concept of sponsored reserves. I believe that the principles of sponsored reserves are well established already. The NAAFI, for example, supplies uniformed personnel to man the expeditionary forces institute and the Met Office provides civilians on RAF stations who are also RAFVR officers. Until recently some Property Services Agency posts in Germany were linked to a war role in uniform as members of the TA. Therefore, there are precedents. We may find that the principle can be usefully extended.

My noble friend Lord Vivian expressed concern that there are insufficient medical personnel in the regular forces, as well as a worry that medical reservists might not be released when needed. The noble and gallant Lord, Lord Craig, was similarly worried. There is no evidence to suggest that staff who have reserve forces commitments are discriminated against in any way

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within the NHS. If any specific difficulties arise, we will certainly take them up with the Department of Health. On the contrary we know that a number of NHS trusts have specifically said that they regard personnel with military medical experience as extremely valuable assets. The National Employers' Liaison Committee is making a special effort to foster support for the reserves among NHS trusts. I note the noble and gallant Lord's assessment that there have been excessive draw downs in the defence medical services but I cannot share his views on that.

I take this opportunity to emphasise to the noble and gallant Lord that the medical reserves remain important. However, the defence medical services have been restructured to provide predominantly regular support for operations short of general war, for example the identified reserve component of our contribution to the NATO led implementation force in Yugoslavia includes few medical personnel. As the anticipated casualty rates in an operation increase, so the deployment of medical reserves becomes more important. For example, support for two British divisions at war casualty fighting rates would require three regular and 11 TA field hospitals.

My noble friend Lord Brookeborough raised a number of points about training. The Bill sets down the maximum period of obligatory training. Regulations may set a lower period for appropriate elements of the reserves, just as happens now. Equally, many reservists will do much more than the minimum. Failure to fulfil the obligation can lead to discharge. As my noble friend Lord Vivian mentioned, the Bill specifies a 16 day training limit for reservists. As I have said, the Bill makes the maximum length of compulsory continuous training 16 days. This is an increase from the 15 days currently applicable to the reserve land and air forces, but less than the 30 days which could be applied to some members of the Royal Auxiliary Air Force. Fifteen day camps will continue to be the norm for the RMR, the TA and the Royal Auxiliary Air Force. Sixteen days is a considerable reduction from the current 92 day limit for the naval reserves. Ships' programmes may necessitate 16 day training periods from time to time.

The noble and gallant Lord, Lord Bramall, recommended an upper limit of six months' service for reservists. The Bill gives clear maximum periods of obligatory service under each call-out power. For the high readiness reserve and sponsored reserves it is nine months unless a shorter period is specified in the relevant agreement. In the most serious crises call-out or recall is for up to three years in any six. The three years can be extended to five by Her Majesty by order. For warlike operations the limit is 12 months in three years, which again can be extended by order to two years in three. For peacekeeping, humanitarian and disaster relief operations, the limit is nine months in any 27, which may not be extended. For each case except the high readiness reserve, the individual may elect to serve for longer. We believe that nine months is the shortest effective period for general call-out. It allows for preliminary training, six months' service in the operational theatre, a return to the UK and terminal leave before release.

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My noble friend Lord Vivian laid stress on the need to safeguard pensions on call-out. We know that reservists wish to ensure that a period of called out service does not reduce the pension they receive from their civilian pension scheme when they retire. We are discussing with the pensions industry ways of achieving this outcome. The Bill clears the way for one of the options which would be for the MoD to continue the employer's contribution to such a scheme while the individual continued any employee's contribution. A reservist unfortunate enough to be killed or disabled while called out would receive payments from the MoD on the same basis as a regular soldier.

My noble friend Lord Brookeborough asked about compensation for loss of earnings during extended training. As I made clear, the Bill makes a considerable step forward in introducing additional payments for reservists who suffer a loss of income. There are no plans to extend payments to training. However, it is possible for an advance of bounty to be paid at annual camp to offset any loss of income.

The noble and gallant Lord, Lord Craig, stressed the need to preserve flexibility and to set the level of payments to individuals and employers carefully. I agree with him. The Bill contains powers to enable the MoD to top up a reservist's service pay after call-out in cases where his or her civilian pay is higher. Many reservists will have financial commitments commensurate with their civilian income. If that was not maintained then, clearly, financial hardship could result. The department's current thoughts are that any scheme of payments would be based on proof of civilian earnings up to agreed limits. Above that, payments would require proof of financial hardship. The intention is to develop a detailed scheme for payment for inclusion in regulations. The Bill requires formal consultation in that process.

The noble Lord, Lord Mayhew, and my noble friend Lord Brookeborough, were particularly anxious about the self-employed. We accept that the self-employed are a special case and that different arrangements may be required for them. We shall continue to consult with interested parties as our ideas are developed.

The financial safeguards for employers proposed by the Bill are intended to offset the costs of call-out, ensuring as far as possible that businesses are not disadvantaged. The costs to business resulting from the call-out of an employee will, of course, vary considerably. We shall develop the details of the scheme in consultation with interested businesses, both large and small, to ensure that it provides sensible and fair compensation for employers. Employers will, of course, have the option of seeking the deferral or exemption of the call-out of an employee if his or her absence would cause severe difficulties to the business.

It is worth my making clear that a principal reason for leaving the details of the scheme of payments to regulations is that they can be amended relatively easily. That will permit the provisions to be modified in the light of experience of their use and of prevailing economic circumstances. I can therefore assure noble

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Lords that the scheme will be able both to provide a fair payment to employers and to secure value for money for the taxpayer.

My noble friend Lord Vivian asked whether the business community was content with the compliance cost assessment. The noble Lord, Lord Williams, also cast some doubt upon the CCA. The compliance cost assessment reports information which has been provided by business. At this stage I say only that there will be a full opportunity for discussion of the elements of the cost to business during consultation on the regulations for payments to employers.

The noble Viscount, Lord Allenby, stressed his view that the safeguards for employers should be stronger. We must indeed be careful of the impact on employers of the use of the new call-out power. However, we believe that there would be national support for the concept of humanitarian assistance to overseas countries, as the financial and practical response to charitable appeals bears witness. We know that some employers are concerned. In response we propose to make the employer exemption criteria easier for this new call-out power than for the others.

The noble Viscount, Lord Ridley, also laid emphasis on properly protecting the employee. He is quite right that the Reserve Forces (Safeguard of Employment) Act 1985 makes it a criminal offence to dismiss an employee because he is a reservist. Under the same Act, an employee who is called out for service has a right to return to his old job when he is released. However, we believe that additional legislation to protect reservists against discrimination in employment would be counter-productive because it would make it more difficult for reservists to gain employment.

We believe that it is preferable to persuade employers of the value of employing reservists. That is the theme of a very successful campaign run by our National Employers' Liaison Committee. Our objective must be that, far from discriminating against reservists, employers seek them out whenever they have vacancies to fill. The new safeguards for employers in the Bill should make it easier to achieve that objective.

The noble Viscount, Lord Ridley, said that any changes to the TAVRAs should require consultation. The powers to amend the number of TAVRAs are exercisable by statutory instrument, which is subject to annulment by resolution of the House. I am sure that we can rely on the noble Viscount, and many other Peers involved with the associations, to ensure that any such change, if it were ever proposed, was fully debated.

The noble and gallant Lord, Lord Craig, suggested that there should be a change to the name of the Air Force Reserve to the Royal Air Force Reserve. I note his point with due seriousness. The Bill maintains the formal legal title of the reserve force to which the RAF's ex regular personnel are transferred as the Air Force Reserve. It does not include the word "Royal". That is the title it has in the Reserve Forces Act 1980. I believe that it is also the title that it had under the Air Force (Constitution) Act 1917. The grant of the prefix "Royal" is conventionally a matter for Her Majesty. It would be recognised in but not effected by a statute. However, the

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titles of two elements of the Air Force Reserve include the prefix "Royal". They are the Royal Air Force Reserve of Officers and the Royal Air Force Volunteer Reserve. It is interesting to note, as an aside, that the Air Force Act 1955 has that title without the word "Royal" and refers consistently to the regular air force and air-force law in its provisions.

The noble Lord, Lord Mayhew, asked who will inform reservists of the provisions of the Bill. We will ensure that every member of the reserve forces knows of the provisions of the legislation, if it is enacted. They will be able to direct detailed questions to the experts in the MoD through their commanding officers.

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