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The Earl of Bradford: No, it does not.

Viscount Mountgarret: I may stand corrected, and if so I apologise.

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The sentiments of this Bill are right, but the practicalities contained within it are wrong. I hope that it will not be given a Second Reading. I will take guidance from my noble and learned friend Lord Fraser as to how we proceed from here.

10.44 p.m.

Lord Mountevans: My Lords, as always, I declare an interest. We still have to do these things, until we put them on paper at the end of the month.

We are all grateful to my noble friend Lord Bradford for introducing this Bill seeking to abolish compulsory service and cover charges and thus simplify the consumer's menu-based concept of what he or she is getting. I believe that he seeks to abolish compulsory service charges while seeking to preserve gratuities and tipping which are discretionary.

I am also grateful to the two maiden speakers. The noble Viscount, Lord Thurso, put the supplier case, while my noble friend Lord Phillimore put the case for the consumer. Both want fair play, but their approaches, as a supplier and a consumer, were inevitably different.

The noble Viscount suggested that tipping should be discretionary and I go absolutely and totally along with him. My noble friend stressed the importance of tourism, and indeed uniformity of practice, which I believe is the most important matter. I found myself agreeing with both of them on a number of points. Of course, tipping--gratuity--should be an option. But service charge, cover charge or, as we call it in this House, "table money", should not, I feel, be compulsory.

So where do we go? Do we seek better enforcement or do we seek compulsory regulation? The argument has gone sometimes this way and sometimes the other. There is a whole wad of legislation which could be prayed in aid: the Price Marketing (Food and Drink on Premises) Order; the Price Indications (Method of Payment) Regulations of 1987 in so far as they refer to credit cards; or the Consumer Protection Act 1987 and its references to misleading information on the price to be charged for goods. They should all be taken into consideration and perhaps in an ideal world they would be. Certainly they are all relevant.

I say that in an ideal world they should be taken into consideration, but sadly this is not an ideal world. That, I think, is what provoked my noble friend Lord Bradford to bring forward his Bill. And because it is not an ideal world, one has to go for something stronger. Even if it is only a matter of giving the issue an airing in this House and giving the Bill a Second Reading, putting it on the record, I believe that, deep down, one has to support my noble friend.

Tourism has been mentioned. Again, I declare an interest. Foreign tourists spend some £2.2 billion in this country. Indeed, 22 per cent. of their total spend is spent on eating out. The British Tourist Authority and my old colleagues there make a major point of marketing the variety not only of British food but also of what one might call foreign cooking. London is the food capital of the world. We lack a Lithuanian restaurant, but

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otherwise there is just about every nationality that one can seriously think of providing food either in the capital or in the provinces. We make a point of encouraging restaurants to provide quality and value for money. But it is difficult to do that if there are different interpretations of what one might call existing subsidiary legislation.

Foreign tourists are, of course, "Johnny foreigner". But we must remember that our restaurants make far more money--I am sure that my noble friend Lord Bradford when he winds up the debate will confirm the fact--from the British tourists. We are all quite often tourists in our own country. So it is quite interesting to see an English Tourist Board survey published only last month which reveals that 55 per cent. of those interviewed were not totally au fait (if I may use a foreign phrase) with the concept of service charge, whether it was compulsory or whether it was discretionary, while 35 per cent. did not understand what services were provided by cover charges or, as the noble Lord who will respond might say, "table money".

Given that ignorance, interpretations or misconceptions, and given European practices, which have been mentioned by several people, we are out of line on this matter. Certainly my experience in France and Sweden has been different. In France, one tosses into the pot the centimes that are left; in Sweden, one tosses in what Swedes call the losore--the small sums. I know that the noble Lord, Lord Peston, eats in a rather higher standard of restaurant than I do and he can defend his position when he rises to speak. Certainly in Sweden, if one has a bill for the equivalent of £59.35, one throws the 65p. into the pot. That is all one has to do.

Good service is taken for granted. It is not something that one has to add on--unless of course the service is brilliant. If it is really good, then of course one rewards it. I do not like the hidden extras--the cover charges, the service charges and the others that have cropped up, let alone the incomplete credit slip. I must support my noble friend Lord Bradford. As I said, he has given this matter an airing. I am not sure that his Bill has any great chance of succeeding, but I certainly hope that it will receive a Second Reading tonight. As a consumer, I would certainly support that.

10.50 p.m.

The Viscount of Falkland: My Lords, I came into this debate with an open mind and I leave it with an open mind, I hope, but much better informed. The contributions of the two maiden speakers were quite remarkable--one from a customer's point of view and the other from a supplier with a great deal of experience. My noble friend Lord Thurso again shows the expertise that comes into your Lordship's House even through the hereditary peerage. I hope that that will be picked up in particular by the popular press. We look forward to hearing both maiden speakers contribute again in this House in the near future.

My feeling as a reluctant diner-out is as a creature of habit. I tend to stick to a restaurant which I like and where everything seems to go according to what I think

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is right in terms of food and service. One restaurant to which I am extremely loyal is connected with the noble Lord, Lord Rathcavan. I believe he founded it and most noble Lords will be aware of the restaurant to which I refer. One of the rewards for both the providers of good food and those who serve it is that customers return to the restaurant. That is a reward in itself.

Tipping is an extraordinary concept. I do not believe that anybody in your Lordships' House has not said at some time, "How much shall I leave?" We have all developed our own mental arithmetic for working the sums out quickly, especially those who frequent betting shops as well who become extremely quick at mental arithmetic.

I cannot see any great benefit in the complications or the "morass", as the noble Earl, Lord Bradford, described it. He is to be congratulated on explaining his position so well and so clearly. I am three-quarters of the way with him. But it seems to me that restaurants and the serving of food implies that one will receive one's food served in the best way possible. It is difficult therefore to calculate whether or not a tip has been earned.

For example, there is no difficulty in a restaurant in deciding that one wants to tip the lady who looks after one's coat or hat. If that service is done grumpily and she squashes one's hat or tears one's scarf, one will only leave her a fraction of what is laid out as a heavy hint in the saucer on the shelf. However, if she has done something like look after one's motor cycle helmet, which is often done for me, one may leave a little more. The same is true of the man who parks one's car. One may want to reward the man or woman who goes out in the rain to park one's car. One may even feel that the waiter has done something exceptional if he goes out to one's car to retrieve a wallet left there. But, I have just returned from Italy where, as noble Lords explained, the procedures are governed by law. In that country one receives a bill at the end which one knew perfectly well one was going to receive, and one just leaves small change or perhaps something more substantial if something exceptional happened by way of service. And that is the ideal situation.

Having researched the whole complex problem a little, I find that the situation is not so simple. It was explained to me by a lady who had been a hairdresser and a waitress--not normally my source of briefing, but on this occasion extremely useful--that in restaurants which generally have a lower turnover and where the price paid per customer is relatively low, the customers and staff are usually young people, who tend to go out on Fridays and Saturdays. At that time, therefore, it is difficult to obtain staff because they also want free weekends. So to those who come in on Fridays and Saturdays tipping is an important part of their agreement to serve the establishment.

Having heard the informed contributions in your Lordships' debate, it seems to me that that could well be corrected by a minimum charge. I see no problem with a minimum charge. I do not agree with the contention of the noble Lord, Lord Monson, that a

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minimum charge is somewhat infra dig, or whatever phrase he used, rather more than a cover charge. It seems to me that a cover charge is less acceptable.

Fundamentally, the British are rather frightened of waiters. On the rare and distasteful occasions when one sees someone being rude to a waiter that person is invariably drunk, which means that he has whipped up some Dutch courage. About 10 years ago I had the great fortune at a dinner to sit next to the distinguished architect, Sir Basil Spence. It was a very charming evening. He said to me early on, "Please speak up because I am rather deaf. It is one of the afflictions of old age. There is only one compensation for reaching old age. You're no longer afraid of waiters". That has always stuck in my mind. There is a kind of fear of waiters among diners and a great deal of uncertainty, which would in a way be dealt with by the noble Earl's Bill.

After today's debate I tend to lean towards the feeling that legislation is the only answer. Certainly cover charges and the other things, which are on the way out as I understand it, are unsatisfactory. What I really do object to is to see on a bill the note that a 12.5 per cent. or 15 per cent. service charge has been included at the customer's discretion. That is an unfair thing to do because the drunk may well say, "I'm not going to pay your charge", but the sober, well-behaved diner may think, "It's frightfully embarrassing. I don't particularly like this restaurant anyway. I'll pay it and I just will not come again". But that is an unsatisfactory of dealing with a business.

It has been an excellent debate and the evening is drawing to a close. I would just say to the noble Earl that if his Bill gets nowhere this time he should follow the example of other noble Lords on other matters and present it again; and if, again, he is unlucky or meets with no co-operation he should put the Bill to a Select Committee of the House. That is what we did on the Dangerous Dogs (Amendment) Bill and I have great optimism about that piece of legislation. This is an excellent subject to be dealt with by a Select Committee of this House if all else fails. I am quite sure that an enormous amount of helpful information would come out of such a procedure on which even better judgments could be based.

10.58 p.m.

Lord Peston: My Lords, I, too, must start by making a sort of declaration of interest. I am chairman of your Lordships' Refreshment Sub-Committee. The House has the equivalent of a cover charge and service is levied in some parts. I have to tell noble Lords that the staff are happy with that and, indeed, all they ever tell me about is the number of noble Lords who do not feel that they want to tip. I shall not regale the House with some of the delicate problems I have had to deal with in that regard. My daughter is a chef of some distinction and I have many friends in the restaurant industry, from those who own restaurants at one end to those who do the washing up at the other. Rather like the noble Lord, Lord Phillimore, I have probably spent more time and

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money in restaurants than is good for me. Perhaps I may also say at this point how much I welcomed his maiden speech and that of the noble Viscount, Lord Thurso, who both spoke from experience and knowledge.

Although, as always, we shall grant the noble Earl the courtesy of giving his Bill a Second Reading, because we always do, I am bound to say that, unlike most, but not every, noble Lord, I am totally opposed to it and would not be in favour of it entering the statute book. Therefore, I shall be as blunt as I can. The Bill seems to be based on a misunderstanding of consumer protection on the one hand and on the economics of the restaurant industry on the other. I am aware of the views, inter alia, of the British Tourist Authority, the English Tourist Board, the Consumers' Association and the National Consumer Council. It is my judgment that they are mistaken, too.

I am especially sad about this because my point of departure tonight is what it always is; namely, to follow Adam Smith's dictum that the criterion to be applied in judging any industry's performance is consumer satisfaction. What the Bill seeks to do is to limit what restaurants can do by service charges, cover charges and the like. I shall return to the special question of leaving the credit card slip open and deal with it in a few minutes. It will be illegal to do those various things, as I understand it, that the restaurants currently do.

Why would it be right to bring the law into this? The answer, in so far as any rational argument has been put forward at all, appears to be that that is what consumers want. Before examining that, perhaps I may reflect on what happens in a sample of restaurants that I go to--the matter has already been referred to--and which I particularly like. I shall mention four of them. The restaurant in the Capital Hotel has a very expensive prix fixe and an o la carte menu. It is a superb restaurant and states clearly that there are no cover charges and no service charges of any kind to be added. That is what one pays. At Alistair Little's there is only a prix fixe and again no cover charge, and service is left to the customer. At The Ivy there is a large o la carte, a cover charge, and service is stated not be included. At Shepherd's, to which many of us go across the road, there is a prix fixe with some dishes costing extra, no cover charge and service is added. So we have a full range of what happens.

In the last three cases, since it is clear before the customer enters the restaurant what the position is, I cannot see that those restaurants are doing anything wrong at all. I have to emphasise that the noble Earl is simply in error in what he is attempting to do. Perhaps I may add that, when he reads Hansard tomorrow, I believe he will also note that he has been verging on the defamatory in his remarks on his fellows in the restaurant business, and I was not happy with that.

In particular I must emphasise--and this lies at the heart of where the noble Earl is mistaken, and the point has already been made--the restaurant business is highly competitive. Some people, as a result of both culinary and managerial skills, together with good luck, earn a lot of money: many others do not. The successes of the former attract new entrants, but most do not

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succeed or survive for very long. It is always a source of great sadness to me that many a good restaurant that I have favoured has gone out of business.

My point is that in this highly competitive environment it is certainly in the interest of the restaurant to give the customer what he or she wants, especially something so simple and straightforward as a cover charge or a service charge. If consumers want it, one will get customers by printing on the menu in large letters for all to see, "Menu £25, no further charge required or accepted". My view is that if it does not suit The Ivy, for example, to do that, it is up to them to decide and to risk losing their clientele, but that is hardly likely. It is for them to decide that and not for us as legislators.

That takes me to the crux of the matter, which is information. A good example is provided by the best of guides, The Good Food Guide, published by the Consumers' Association. In our present area of discourse it does exactly what is required and what is most helpful. It gives a clear indication of the restaurant's price range, its position as regards service and cover charges. It tells one about the dreadful practice of leaving credit or direct debit slips open when service has already been levied. In other words, it does exactly the job that ought to be done.

That takes me to the Price Marketing (Food and Drink on Premises) Order 1979, which has been referred to. I do not believe that that has been superseded by Part III of the Consumer Protection Act 1987, but I do believe that Sections 20(1) and 26 of that Act are important supplements to the earlier order, together with the Code of Practice for Traders on Price Indications published by the Minister's department in November 1988.

My own view is that it is transparency that is required and that the existing legislation, if enforced, protects the consumer while not interfering unnecessarily in the way in which restaurants conduct their businesses. I believe that the noble Viscount, Lord Mountgarret, made that point earlier.

In that connection, it has been alleged that, although restaurants disclose fully all prices before the customer enters the eating area, which is what they are required to do under the price display order, their actual menus are different. My experience does not bear that out at all. The menus that I am given in the places to which I go are precisely what was in the window before I stepped into the restaurant.

At this point, I must mention another matter which is important but which the noble Earl's Bill ignores. Section 5 of the price marking order requires the display of wine prices. Most restaurants, including the Savoy, do not meet that obligation although it is a legal requirement. The trading standards departments with which I have been in contact--for example, the excellent department in North Yorkshire--do not seem to enforce that requirement rigorously. I believe that not infrequently when the restaurant bill is larger than one expects, the reason is the obvious one: you have ordered more and better wine than you had intended. I believe that consumers must bear the consequences of their own actions in this regard as long

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as they have not been misled. However, I would welcome the Minister's comments on the enforcement of Section 5, the wine section, of the price marking order.

Perhaps I may now turn to the problem of open credit card slips. I agree with all noble Lords that that is an outrage. I am told by my legal advisers, however, that restaurants which levy a service charge and then leave open the credit card slip are almost certainly committing criminal deception. The noble Lord, Lord McConnell, who is versed in such matters alluded to that. If restaurants are committing criminal deception, we may not need new legislation; we merely need to enforce the criminal law and someone should bring a test case, perhaps backed by the Consumers' Association or the NCC. However, I may be naive on this matter and perhaps we need a straightforward ban on that unattractive practice. Again, since the Minister has all the legal expertise that I lack, I should welcome his guidance and advice on the point.

I have two points to make about tips and pay. First, as other noble Lords have said, it is the role of management to ensure good quality service first by recruiting good quality staff and then by paying them appropriately. Secondly--this is my only political point--the way to deal with low pay (which arises from excessive bargaining power on the part of the employer relative to the employee) is to introduce a statutory minimum wage. A restaurant which cannot survive except by paying very low wages to its staff deserves to go out of business. Of course, I appreciate that there is occasionally malpractice. The case of Burger King, owned by Grand Metropolitan, appalled all of us. It was an abuse of managerial power, but I have not heard that any managers have been fired. Cases of malpractice are not unique, but abolishing tipping has nothing to do with that kind of malpractice.

As we are on the subject of occasional malpractice, I should add that I was shocked by the television programme late last year which showed clear-cut cases of violence against junior staff being perpetrated by senior staff in some restaurants. Again, does the Minister know of any impending prosecutions by the police in relation to those instances of criminal or common assault? It is a very serious matter.

To conclude, all of this depends on the view that one takes of the consumer on the one hand and competition on the other. The state has a role to ensure transparency--full information--and to prevent the exercise of undue market power, but it is not the role of the state to impose uniformity on this sector or, for that matter, any other. I, for one, believe that the consumer can be trusted. That is not to say that all restaurant experiences are satisfactory. I believe that the noble Earl referred to his wife having such an experience and I could bore your Lordships with many tales of how I have been poorly treated in one restaurant or another.

Even though a restaurateur is subject to great competition, I am always puzzled as to why he sometimes goes out of his way to annoy his

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customers. When that happens, my answer is simple--again, the noble Viscount, Lord Mountgarret, made the point--I just do not go back. I am under no obligation to go to any particular restaurant, or any restaurants at all. I write off the bad experiences. I go further and tell my friends accordingly. Consumers generally can and should do the same. Therefore, although as a matter of courtesy we give the Bill a Second Reading, I hope that that will be the last we see of it.

ll.l0 p.m.

The Minister of State, Department of Trade and Industry (Lord Fraser of Carmyllie): My Lords, I have listened to the debate with great interest. My noble friend Lord Bradford has been an admirably persistent campaigner for all-inclusive pricing in restaurants over a long period. I begin by congratulating him on his tenacity. It has been all too clear during the debate that some of the points he made struck a chord with many noble Lords, not least my noble friend Lord Montgomery and the noble Lord, Lord McConnell.

First, perhaps I may congratulate the noble Viscount, Lord Thurso, on his excellent maiden speech. He revealed great experience of the industry and made a number of usefully perceptive points. At the same time, while opposing the principle of the Bill, he skilfully eschewed a tone of controversy which might otherwise have been unacceptable in a maiden speech.

Perhaps I might similarly congratulate my noble friend Lord Phillimore. In some respects, while his speech was equally excellent, he had an easier task because he supported the principle of the Bill. He admirably expressed that irritation which we have all experienced of being subjected to an ill-defined pressure to leave a tip when the service has not warranted a penny of appreciation, although we have been uncertain whether a charge appearing ultimately on the bill is one which was declared openly some hours previously when the meal was first ordered. As he put it, for a variety of reasons recollection of what was on that menu might have become somewhat dimmed. It was a useful pair of maiden contributions, and I congratulate them both.

As your Lordships will be aware, the Government have acknowledged on a number of previous occasions, as I do now, that the variation of practice in how restaurants and similar establishments choose to set their prices can, in the absence of clear indications, at times be confusing. But that is not in itself a reason to put in place further regulation in the form of primary legislation.

To prohibit service and cover charges, as is proposed, would restrict restaurateurs' freedom to run their business in the way they believe will best enable them to maximise their custom and provide their clientele with an effective service. I believe, as the noble Lord, Lord Peston, said, from the consumer's point of view that competitive forces would soon see off those businesses with, if I may put it this way, too greedy an appetite for profit.

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I enjoyed the speech of my noble friend Lord Lindsey, but wish that he would reveal to us just how long it was the restaurant in which he invested his hard earned money survived, given the quality that was offered. My main concern is what would be the impact of obligatory all-inclusive pricing on the general level of meal prices.

My noble friend Lord Bradford may have noticed an article in today's Evening Standard which takes up the point of pricing. It has the apposite headline, "Just tip the taxman". That is a point upon which the noble Lord, Lord Cadman, dwelt. I fear that it would necessarily follow that if the Bill were to be implemented, VAT on a service charge included within a single total would, as a matter of law, be required. Inevitably, that would sooner or later be passed on to the consumer.

That is not the only matter. There is also the question of transparency. Whereas now service and cover charges must be clearly stated if they apply, my noble friend's proposals--this may not be what he intends--would have them hidden in one single overall figure. It would thus become more rather than less daunting for consumers to withhold a percentage of the bill if they considered that they had received poor service. Even if in law--and that is an interesting question--they were entitled to withhold a service element having regard to the poor quality of the service received, what would be the percentage to be withheld? Is it to be 8 per cent., 10 per cent., 12.5 per cent., 15 per cent. or in smarter restaurants 25 per cent.? Unless that too were specified, I do not know how the matter would be handled.

What matters, of course, as for any other commodity or service, is that consumers are not misled over what they must pay and can therefore make an informed choice on where to place their custom. General and specific legislation to achieve those objectives is already in place.

An order which requires menu prices to be displayed at restaurant entrances and any compulsory additional charges also to be displayed at least as prominently as the menu prices has been in effect since 1979. Additionally, Part III of the Consumer Protection Act 1987 makes it an offence to give consumers a false or misleading indication as to the price at which virtually any goods or services are available. That Act also empowers the Secretary of State to make regulations on how price indications may be given. The fact is therefore that consumers already have to be made fully aware of what they will have to pay for their meal before they enter the restaurant and place their order.

There is no legislation governing optional charges, but a code of practice approved by the Secretary of State for Trade and Industry under Part III of the 1987 Act recommends that such charges should not be included in bills presented to customers. While a breach of this code is not in itself an offence, a departure from its recommendations may be used to support the prosecution of a false or misleading price indication under the Act.

The Government have twice in recent years reviewed the case for specific regulation on service charges. In February 1993, my noble friend Lady Denton of

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Wakefield announced that she was not convinced that further legislation would make an effective contribution to solving the problems that can arise over payment for service. She was responding to a report on the issue by a working group of relevant interests from the Monitoring Committee on Misleading Price Indications which the Government had appointed in 1989 to review the operation of Part III of the Consumer Protection Act. My noble friend's view was that it was better to rely on consumer common sense and to encourage best practice within the trade.

My noble friend Lord Strathclyde took the same view when a subsequent proposal to abolish service charges was made in another place in February 1994. I too share those views, while noting again that the power to regulate is already available for use under the 1987 Act should sufficient evidence emerge to justify further controls.

My noble friend Lord Bradford has drawn attention to the survey by the Consumers' Association reported in a recent edition of Which? magazine. This suggested a high level of confusion among people who eat out about what cover charges are for and about their rights to refuse to pay for service. A high proportion of those interviewed were reported to favour abolishing cover charges and either including service charges in meal prices or not allowing an extra charge to be added for service. I do not believe that those findings can be dismissed immediately. But given the confusion that exists as to whether service charges can or cannot be objected to, I wonder whether there is not a greater ambiguity in those findings than is claimed for them. Certainly the fact is that, despite regular airing over the past three or four years of the issue, the apparent concern revealed in Which? has not been reflected in evidence of consumer dissatisfaction reaching the DTI and particularly pointing to the solution offered by my noble friend. Therefore, while I do not set aside what has been indicated as a matter of concern, I remain to be persuaded that the proposal advanced does indeed meet the not very well expressed concerns that the general public may have.

I should tell the noble Lord, Lord Peston, that, as he implied, the 1979 order does require wine prices to be indicated. I do not have the knowledge of the same fine restaurants that the noble Lord frequents to know how well that is followed through, but the law is certainly sufficiently clearly stated.

Perhaps I may also deal with the matter of the open credit card. It is really quite difficult to give a simple answer in that respect. If the matter is simply left open--that is, effectively, leaving the customer in exactly the same position--where a service charge has been imposed and he wishes to give a further charge, that is entirely a matter for him. However, if the waiter, when asked whether a service charge has been included, denies it, or if he should actually add in a figure after the credit slip has been signed, it would seem to me that it is not difficult to envisage a number of offences at common law arising.

I shall now turn to the proposals put forward by my noble friend for amending Part III of the Consumer Protection Act 1987. By defining as misleading for the

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purposes of the Act price indications which indicate a separate service or cover charge, Clause 1 of the Bill would, in effect, prohibit such indications. The Long Title of the Bill confirms that that is the intention.

The purpose of Part III of the Act is to achieve transparency in price indications across all goods and services. It would surely be contrary to that aim--which would seem to be desirable--to prohibit a type of price indication which explicitly advises a consumer whether or not, as the case may be, a service or cover charge is included. That would seem to me to be perfectly clear and not at all misleading. So I would be concerned that the effect of Clause 1 would be to reduce transparency and clarity. I believe that that was exactly the point that my noble friend Lord Mountgarret made in his speech.

A second point of importance is that the clause would change the scope of Part III of the Act to introduce provisions which relate to a specific sector. That would be undesirable, in that it might cast doubt on the continued general application of Part III of the Act to all price indications.

I referred earlier to the power which Parliament gave to the Secretary of State under the 1987 Act to make regulations relating to the circumstances and manner in which price indications are given. If my noble friend's Bill were to proceed, it would override that discretion. Although the Secretary of State has not seen it as necessary to use that power in respect of service charges, were he to do so, he would be under a statutory obligation first to consult the Director-General of Fair Trading and other parties. The proposal would circumvent that requirement.

These are fundamental objections and not simple technical details that could readily be resolved. However, other aspects of the Bill also give rise to concern about how much attention has been given to its drafting and the consequences that it would have. For example, in Clause 1, it is not clear whether,

    "a separate charge for the service of food or drink",

would include the entire provision of the food or drink or simply the service actually at the table. In the latter case, the way would still be clear to make a separate charge for the preparation. Similarly it is not clear whether it would be possible to charge for entertainment.

If your Lordships have an objection to sloppy waiters, I am sure I shall unite noble Lords when I say how much I detest singing waiters. If one were entitled to impose a charge for a singing waiter, a dancing waiter or, as I have once been exposed to--horror of horrors--a roller skating waiter, it would seem to me that the valid concern that my noble friend has would in large measure be sidestepped.

Clause 2 of the Bill also contains what I consider to be a number of other defects, but given the time of night it might be acceptable if I were not to spell those out, but I consider they are real ones. The principal objection that I have is the way it is drafted. If there were to be a breach of the code of practice referred to under this provision, the clause of itself would not provide for an offence and accordingly the legal certainty which one would presume was intended would not be achieved.

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This has been a useful debate. It has spelled out a number of concerns that are undoubtedly felt across the community and a wide range of views have been clearly and usefully expressed. However, for the reasons that I have spelled out, not least the problems that I see about transparency and the deprivation of choice that would be imposed--while I would hope, as the noble Lord, Lord Peston, said, that the normal courtesy of your Lordships' House would be extended to this Bill in relation to a Second Reading--I have to say that it is not a Bill that I can wholly recommend to your Lordships.

11.26 p.m.

The Earl of Bradford: My Lords, I realise that we have arrived at a rather late hour so I shall try to keep my comments reasonably brief. The purpose of this Bill is essentially to simplify the situation and to avoid confusion. I shall explain a little about tipping. Originally this was a reward for excellence. It has now become the norm. I think it should return to being a reward for excellence. The service charge should be done away with; it is an anomaly.

Various noble Lords have mentioned the situation in America--the land of great and free tipping. Now the service charge is creeping in there. Surely that is the thin end of the wedge. Does that not indicate the right way forward for us to take here? As regards cover charges going out of existence, that is not happening. At lunchtime only today my wife went to a restaurant where a £2.50 per head cover charge was imposed. If a service charge is added to that, too, it can represent a considerable extra charge. I personally cannot see why that should not be absorbed into the cost of other dishes on the menu. It seems a ridiculous anomaly in this day and age.

Also we should recognise that in the main we tend to be rather more sophisticated as regards the matter we are discussing. I would love to be the guest of the noble Lord, Lord Peston, at any of the restaurants he mentioned tonight. However, that is very much the top end of the market where the clientele tend to be rather more sophisticated and understand in advance what they are going to be charged. We must remember the visitor to London, both foreign and British, as was mentioned by my noble friend Lord Mountevans. Those visitors look to advertisements, which seldom give any good guide as to prices in the restaurant, and then they look at the menu outside the restaurant. I certainly experienced quite recently what my noble friend Lord Mountgarret referred to as the cowboy phenomenon. Appropriately, that was in a steakhouse. There the restaurant had managed to cover up the indication of the cover charge and the service charge with the menu of the day. That was not only on one menu board outside the restaurant but on all three. One did not realise until one was inside the restaurant.

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