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Baroness Carnegy of Lour: My Lords, I know that at Report stage every speaker rises only once to speak, but with the leave of the House perhaps I may ask the noble Lord about the main constitutional point that he made. Does he believe, whether a Bill begins in this House or in another place--I am glad that the Bill began in this House because we have examined it with great care so far--that an unelected Chamber should remove the guts of the most important part of a Bill?

It seems to me that he is misleading the House on this matter, as when he joined in a number of misleading arguments that we have heard before--for example, that parents have to use their voucher. They do not; they have their piece of paper but do not have to use it. He made a number of misleading comments to which perhaps at this stage I should not respond. But does he believe that this House should remove the guts of a Bill whether or not it has been before the House of Commons?

4 p.m.

Lord Ewing of Kirkford: My Lords, with the leave of the House, I feel that the noble Baroness is getting a little over-excited. I am not guilty of misleading your Lordships or anyone else. I explained before that during my term as a Scottish Office Minister there were six or seven press officers. There are now something like 44 in the Scottish Office. There are four press officers for every Scottish Tory MP. The noble Baroness complained that I am misleading the people of Scotland, when in the Scottish Office there are four press officers for every Tory MP in Scotland. I plead not guilty to what I regard as a very grave charge of misleading your Lordships.

With regard to the constitutional question, I take a rather simple but profound view. If your Lordships' House is asked to examine legislation, we have every right to amend it. Otherwise, why are we asked to examine the legislation? That we have no right to amend

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it is the best argument that I have yet heard--the noble Baroness has it on the record--for Tony Blair's proposal to reform this Chamber.

Lord Sewel: My Lords, history is catching up with many of us today. The noble Lord, Lord Lyell, referred to Grampian and Tayside and I have to tell him that he helped to abolish those authorities.

It is difficult to overestimate the importance of this part of the Bill. For the first time a Bill seeks to ensure that the provision of a major service is achieved through a voucher scheme. Nothing at all like that has been done in the area not only of education policy but of social policy generally. It is a major change in the approach of the Government to the provision of major services. Therefore, it requires very close and detailed scrutiny.

The noble Lord, Lord Ewing, made a principled objection to the voucher approach. By introducing vouchers, we move into uncharted waters and there are dangerous rocks ahead. Let me mention just a few. One that concerns me is the whole area of fraud. The Audit Commission has already drawn attention to the need to have in place extremely robust and powerful procedures to guard against fraud. I find it extremely difficult to see how we can have a scheme which minimises to acceptable levels the opportunity for fraud.

If there are unscrupulous providers, what is to prevent some deal being done whereby the person holding the voucher (which cannot be cashed for £1,100) can obtain fewer sessions than the face value of the voucher would secure and have a cash settlement as well from the provider? It is difficult to see the kind of procedures that would prevent such fraud taking place. We need a clear statement from the Government, with the support of the Comptroller and Auditor General, about how that major kind of abuse is likely to be prevented.

The Government also argue that the voucher scheme will increase provision and bring new players into the market. I do not believe that is likely to be the case. The voucher scheme is pitched at the level of £1,100, which, as we have been told on a number of occasions, covers basically the recurrent revenue costs of a half-time provision. It does not cover the capital costs. So it is unlikely that new players will enter the market when the price of the voucher does not enable them to cover their capital expenditure in setting up the new nurseries. There will certainly be some slack. There may well be a marginal increase but not a significant increase.

The perversity of the scheme is that, by introducing the £1,100 voucher, far from increasing the provision, it may have the effect, if provision remains roughly constant, of allowing the price level to rise. So in the private sector, the price level of private provision may increase. I think that is not what the Government want but, clearly, it is one of the dangers that beset a voucher approach.

There is also the danger that in some areas there may be a reduction in provision from the present levels. The noble Lord, Lord Sempill, made reference to the difficulties of rural areas. Let me repeat the example that I gave in Committee. In a rural area, a local authority may just be able economically to make provision for one

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nursery class, say of 25 children. Quite understandably, perhaps because of the area in which the father travels to work, it may be more convenient for two or three of those children to be taken to a private nursery school and the voucher used to gain access. I do not criticise the parents for doing that. But by taking those children out of the local authority nursery school and taking money with them, there is a danger that the local authority nursery school will no longer be economically viable. So there is the bizarre situation whereby the choice exercised by the few denies provision for the many. That is the situation that can stem from this ill conceived and ill begotten idea of nursery provision.

We have seen in Scotland the model for effective nursery provision. The noble Lords, Lord Sempill and Lord Ewing, have already drawn attention to it. Basically, it builds upon the strengths and example of local authority provision, certainly complemented and in partnership with the private sector. It is not done through a madcap voucher scheme.

The Earl of Lindsay: My Lords, the noble Lord, Lord Ewing, offered me a place in the history books should I decide to abandon this part of the Bill, which I have no intention of doing. I should tell him that in an area of Scotland that he knows well, I am already in the local education history books. I shall soon have 25 per cent. of an entire primary school because five of my children will all be attending the same school at the same time. I intend to keep that very good local authority primary school going by maintaining that sort of proportion.

Lord Ewing of Kirkford: My Lords, has the noble Earl advised his wife of that?

The Earl of Lindsay: My Lords, I believe in partnership.

I was interested in the exchange between the noble Lord, Lord Ewing, and my noble friend Lady Carnegy on the constitutional point. I do not disagree with the noble Lord's riposte. However, in defence of my noble friend, I point out that the other place passed the English Bill which deals with nursery voucher provision and therefore backed the principle of nursery voucher provision. For those who, like my noble friend, see a constitutional problem, that may be of relevance.

I point out to the noble Lords, Lord Carmichael, Lord Addington, Lord Sempill and others, including the noble Lord, Lord Sewel, that there are people in Scotland who are looking forward to the provision of nursery vouchers. Many parents are seeking the provision. The pilot scheme launched in East Renfrewshire illustrates an interesting reaction. When the scheme was announced, the telephone system could not cope with the calls coming in from interested parents. When my honourable friend the Member for Aberdeen, South, the Scottish Education Minister, recently visited on the helpline, it was swamped with calls from outside the pilot project area asking why they could not be included in the scheme.

Parents want the voucher system. It may be that there are elements of the existing educational structure which do not want to contemplate such change. But the

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beneficiaries--the parents and the children themselves--have a much more positive approach. Other organisations also support the idea. The Gaelic playgroup movement in particular expressed a keen interest in the voucher system. The noble Lord, Lord Ewing, referred to the Western Isles as being a place where it would have little relevance. We know that it will have great relevance, not only for journeys of 40 miles or more but also to generate playgroups serving specific communities such as the Gaelic community.

I draw attention also to the Scottish Consumer Council, which paid tribute to the opportunities of wider involvement which the voucher initiative will offer. There are people in Scotland who want the voucher system to be installed. The four pilot project areas--I address this point especially to the noble Lord, Lord Sempill, because he had anxieties about certain rural areas and the practicality of the voucher system--are deliberately located across a range of different types of community and geography. We want to find the rocks in the water, if they exist, to which the noble Lord, Lord Sewel, referred; we want to iron out the problems and ensure that the benefits the scheme can bring are delivered.

My noble friend Lord Goold put his finger on the point when he said that radical ideas are always treated with suspicion. I hasten to add that they are not always treated with wisdom. The witnesses who gave the so-called "evidence" to the Select Committee in Glasgow were speculating about a scheme that did not exist. To categorise it as "evidence" may be misleading. They were seeking to speculate as to what their response would be to something which did not yet exist.

Fifteen years ago noble Lords on the Benches opposite would have made the same speeches about the sale of council houses to sitting tenants as we have heard today. They resisted those reforms to the last ditch, yet in Scotland the system has produced 315,000 home-owners and increased home ownership from 35 per cent. to 57 per cent. Similarly, noble Lords opposite would have spoken against the system of school placing requests which since 1981 has enabled over 240,000 parents--90 per cent. of all the parents who applied--to exercise choice in selecting the school that they want their child to attend. They would have spoken against school boards and even report cards. The dogma which the noble Lord, Lord Ewing, accuses us of having is one that they hold in terms of opposing parental choice wherever it occurs.


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