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Lord Mackay of Ardbrecknish: My Lords, I do not agree with the noble Lord, Lord Ezra, that it is confusing. I believe it is perfectly clear. As my right honourable friend the President of the Board of Trade has made clear on a number of occasions, each case has to be considered on its merits. As his announcement on 24th April made clear--and as I did in my original Answer--he does not believe that vertical integration is inherently objectionable. However, he believes that in the current state of the market there would be significant detriments to competition if these mergers proceeded at this time.

Lord Clark of Kempston: My Lords, does my noble friend agree that, whether it is vertical or horizontal integration, the privatisation of previously nationalised industries, including electricity, has been a great boon to

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the British taxpayer in that the taxpayer was previously paying a subsidy of many millions of pounds to the nationalised industries, whereas now, the Chancellor of the Exchequer, to the advantage of the British taxpayer, is receiving revenue from the previously nationalised industries?

Lord Mackay of Ardbrecknish: My Lords, my noble friend is of course absolutely right. Over the past 17 years, privatisation policies have been hugely successful in a vast number of industries which have moved out of the public sector into the private sector. The proof of the pudding is that the party opposite in all its promises and pledges, although few in number when it comes to counting them, has made no promise or pledge to renationalise the privatised industries. I could not help but notice a recent article in the Economist which stated:

    "In state hands Britain's electricity industry was grossly inefficient and so a costly burden for the rest of the economy. The Conservatives were right to privatise it".

Lord Borrie: My Lords, in the light of his answer to the supplementary question asked by the noble Lord, Lord Ezra, will the Minister tell us why, if there is no confusion in government policy, they have banned the mergers proposed by PowerGen and National Power, but have permitted the merger between Scottish Power and ManWeb?

Lord Mackay of Ardbrecknish: My Lords, the issues and the cases in front of my right honourable friend the President of the Board of Trade were different. I am sorry that some noble Lords opposite laugh. It seems to me that there is a considerable difference between Scottish Power and PowerGen and National Power. Even someone with only a passing knowledge of the electricity industry would know that there is a considerable difference. So far as concerns PowerGen and National Power, my right honourable friend the President of the Board of Trade, as he said in his Statement, did not accept the MMC's view that the adverse effects of the mergers that it identified could be met adequately by the remedies it proposed, and he therefore came down against the proposal that the merger be allowed to go ahead. The position with regard to Scottish Power is that it may be a large generator in Scotland but its generating capacity into England and Wales is severely limited by the power of carriage of the interconnector, as I am sure the noble Lord, Lord Borrie, knows full well.

Lord Campbell of Croy: My Lords, as the two electricity companies in Scotland have for many years each been both a generator and a distributor, are any problems arising with them, since after privatisation they appear increasingly to be undertaking projects in England?

Lord Mackay of Ardbrecknish: My Lords, as my noble friend will be well aware, the situation in Scotland is as always a bit different from that in the South. The two authorities in Scotland, which were privatised, form in some ways competing companies. However, in England and Wales if one had had vertical integration

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on privatisation there would have been little or no competition. We were determined to introduce competition, which is why we took the course we did on privatisation. As those noble Lords who are interested in electricity will know, competition is increasing; generation is being spread beyond PowerGen and National Power; and the position on competition is therefore likely to evolve and change into the future.

Lord Dubs: My Lords, how does the Minister reconcile the Statement of the President of the Board of Trade when he banned the two mergers in April with the fact that the DTI itself gave evidence to the MMC in which it said that it was for the MMC to consider the balance of advantage? Is that not another instance of the Government not having a policy, even on those two mergers?

Lord Mackay of Ardbrecknish: My Lords, of course it is for the MMC to consider the balance of advantage and disadvantage, but it is also for the Government to decide upon the recommendations made by the MMC. The MMC does not make recommendations which the Government are obliged to follow. The Government then has to make a decision based upon what the MMC says, and, in this case, upon what the Director General of Electricity Supply says. In the two cases at which we are looking, my right honourable friend Ian Lang decided, as I have already said, that he should not approve the two proposed take-overs.

Gulf War: Health of Servicemen

3.5 p.m.

The Countess of Mar: My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In so doing, I declare an interest as patron of the Gulf Veterans Association.

The Question was as follows:

    To ask Her Majesty's Government what is their response to the results of research conducted at the Southern General Hospital, Glasgow, and by scientists in the United States, into the effects of the combination of drugs and vaccines administered to members of British and United States' armed forces, and the pesticides to which they were exposed at the time of the Gulf War.

The Parliamentary Under-Secretary of State, Ministry of Defence (Earl Howe): My Lords, we were aware of the research being undertaken in Glasgow and were interested to read the team's report of its findings. So far as research in America is concerned, the work at Duke University, North Carolina, has recently been widely publicised in the media, but the research team has yet to publish its own report. Until we see that report, we cannot comment on the team's findings.

The Countess of Mar: My Lords, I thank the Minister for that reply. Before I ask my questions let me make it absolutely clear that I am satisfied that the Government should do everything that they can to

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protect their troops in the theatre of war against any chemical and biological weapons. However I am also concerned that when the drugs, vaccines and other protective agents cause problems they should be investigated adequately. Therefore, in view of the fact that it was in July last year that Dr. Jamal sent his paper to the Ministry of Defence, and was visited by Wing Commander Coker at the end of July, why has no contact whatever been made with Glasgow Southern General Hospital, yet the USA Department of Defense, as soon as Dr. Jamal's paper was published, asked for copies of the paper, which it is following up? Why has our Ministry of Defence done nothing?

Earl Howe: My Lords, it is not true that there has been no contact between my department and the Glasgow research team. The consultant in charge of the Gulf veterans' medical assessment programme visited Dr. Jamal in August last year after a copy of his research findings had been passed to us. Later, we had to reject a request from Dr. Jamal for assistance with further research because we had not at that stage decided what areas of research to pursue. We provided him with a copy of the guidelines in which we envisaged collaboration with outside researchers.

Lord Williams of Elvel: My Lords, does not the Minister find this an odd story: each time Gulf War Syndrome is raised, the Government say, "Well we do not have the evidence. There is nothing in it"? The next time it is raised they say, "We do not have the evidence, and there is nothing in it". The next time it is raised with further evidence they say, "Well, perhaps there is something in it". When will they sit down and say, "Look, there may well be something in it", and admit that they have not yet taken it as seriously as it should be taken? This is an important matter, for, admittedly, a minority, but a significant minority, of people who served honourably in the Gulf War.

Earl Howe: My Lords, there has been no inconsistency in what we have said. We retain an open mind, as we always have done, on the so-called Gulf War Syndrome. There has been no evidence to date that such a syndrome exists, but it is only responsible of us to pursue such matters and to get to the bottom of them. That is why we have proposed the research that we have, which will be proceeding shortly.

Lord Napier and Ettrick: My Lords, is it true that doctors treating these patients have been denied full knowledge of the cocktails with which these people were injected, in particular to do with nerve gas?

Earl Howe: My Lords, I do not believe that there has been any secrecy about these matters, although clearly in some cases the precise compounds remain a classified matter. The vaccinations against endemic infectious diseases and the assessed biological warfare threat were offered to Gulf personnel on the basis of voluntary, informed consent. Those products were licensed, fully tested, and cleared by the National Institute of Biological Standards Control before their use. All the

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vaccines have recognised civilian uses. I am surprised to hear what the noble Lord said. If he would like me to follow it up I shall gladly do so.

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