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Lord Hooson: My Lords, does not the noble and learned Lord agree that it would be embarking upon a dangerous course to follow the suggestion of research into jury judgments? After all, one would be inquiring into their judgment. When a jury retires no notes are taken of its deliberations and it may be out for days. What transpires in its verdict is its general view of the whole case. Has not that been one of the great safeguards of justice within our country? The noble and

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learned Lord may agree that to embark on a judgment that is described as independent and authoritative would be extremely misleading. Very often, as I am sure the experience of many who practice at the Bar illustrates, jury verdicts--often against the whole tendency of the media--are correct in their eventual judgment.

The Lord Chancellor: My Lords, I believe that there is general public confidence in the jury system in serious criminal trials and that the only major contemporary question is whether serious fraud trials should be made an exception. I also feel strongly that jury service is a major civic duty involving the public in deciding questions of fact about guilt or innocence, and that gives the public great confidence in the administration of criminal justice. The Government are also conscious of the main arguments against jury research; namely, that jury service is burdensome enough for members of the public without jurors being interrogated about the ebb and flow of their deliberations in the jury room.

Lord Archer of Sandwell: My Lords, does my noble and learned friend agree that the system may be brought into disrepute not by what juries say and do, but by what lawyers and judges say and do? To address the problem of fraud trials by withdrawing cases from juries is rather like responding to malpractices in horse-racing by shooting the horse.

The Lord Chancellor: My Lords, I agree that the sins of others in the administration of justice are visible and that juries deliberate in private. That is why some say that jury research is required.

Gas Directive: Combined Heat and Power

3.22 p.m.

Lord Ezra asked Her Majesty's Government:

    Whether the European Union gas directive, as redrafted, contains a discrimination against combined heat and power, and, if so, whether this is in contradiction with declared European Union policy in favour of combined heat and power.

The Minister of State, Department of Trade and Industry (Lord Clinton-Davis): My Lords, the policy of the Energy Council is to support combined heat and power and we will promote it under our presidency as a means of contributing to renewable energy objectives. The proposed gas directive allows member states an option to establish a consumption threshold to determine the eligibility of combined heat and power producers to benefit from gas competition where it is necessary to safeguard the balance of their electricity market. It was not the council's intention to discriminate against combined heat and power or to contradict European Union policy in proposing this provision, but to permit member states a means to prevent distortion of their

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electricity markets where incentives or preferences are already provided to promote combined heat and power projects.

Lord Ezra: My Lords, I thank the noble Lord for that Answer. However, I should explain that for many years I have been a strong advocate of combined heat and power and at present am connected with a company that operates such schemes. In spite of what the Minister said, does he agree that it is a little unfortunate, coming so soon after the Kyoto Conference, that the EU should appear to be speaking with two voices about one of the most effective means of reducing energy consumption? In that connection, will he confirm that a draft directive is now being considered by the European Parliament? If the parliament was to come forward with revised wording for the directive which would lessen the adverse impact on combined heat and power, can the Minister say whether the Council of Ministers, over which the UK currently presides, would look favourably at such an amendment?

Lord Clinton-Davis: My Lords, I am well aware of the noble Lord's commitment to combined heat and power, a commitment which, as he knows, I have shared for a long time. The Government share that view also. Indeed, only yesterday the fuel efficient CHP generating plant at the British Sugar Plc factory at Bury St. Edmunds, Suffolk, was the first to be given government consent while the review of energy sources for power generation is under way. That is encouraging and shows the Government's commitment. I do not accept that the EU is speaking with two voices. It is a matter of interpreting what was said by the council. I am aware that the European Parliament is to deliberate on the matter. I do not want to enter into hypothetical questions in relation to what the eventual conclusion may be, but the presidency and the Commission will take serious account of anything that the European Parliament says.

Lord Hardy of Wath: My Lords, given the huge and increasing volume of coal-fired generation on other continents, would it not be sensible for Europe and preferably Britain to ensure that research and development into clean coal combustion in association with combined heat and power would be both nationally and internationally relevant?

Lord Clinton-Davis: My Lords, that is a matter for the presidency and the Commission. I have taken strong account and note of what my noble friend said.

Lord Razzall: My Lords, without wishing to provoke an intervention from the noble Lord, Lord Bruce of Donington, does the Minister agree that that was a somewhat shabby compromise by the Council of Ministers in order to protect the interests of Spain? Would it not have been better for it to have been dealt with by giving Spain a derogation? Can the Minister confirm that the policy of the United Kingdom Government is to use their influence in the European Parliament to ensure that the correct result is arrived at

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in order to give Spain the protection it needs without at the same time going against the principle of combined heat and power?

Lord Clinton-Davis: My Lords, I do not accept that it was a shabby compromise. In fact, the agreement that was reached sought to take account of the requirements of various countries. The role of the United Kingdom in the presidency is to advocate that specific arrangement and the role of the EU Parliament will be to investigate the whole process. It will not be of use for me to speculate as to what the outcome will be, save to say, as I indicated, that the presidency and the Commission will take serious note of the European Parliament's view. Of that I have no doubt at all.

London and Continental Railways

3.27 p.m.

Lord Berkeley asked Her Majesty's Government:

    What is their current contingent liability in respect of debts incurred by London and Continental Railways.

The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Baroness Hayman): My Lords, London and Continental Railways raised some £430 million of debt to fund the development of the CTRL and Eurostar operations for the period up to the main fund-raising for construction. Under the funding agreements with the lending banks, that debt is to be repaid from Eurostar revenues in the event that the development agreement is terminated.

Lord Berkeley: My Lords, I am grateful to the Minister for that Answer. At the time the Channel Tunnel Rail Link Bill was passing through your Lordships' House, and the Government were awarding a contract--after competitive tender--to London and Continental Railways, the then Minister of State for Transport, John Watts, issued a memorandum on 8th March which stated that none of the total government finance of £1.8 million would be payable until three-quarters of the way through construction. It also stated that LCR would be responsible for the construction and commercial risks. There was nothing in the document about quantifying contingent liabilities. Can the Minister say whether she agrees that the House was seriously misled by the previous government in being led to believe that all early construction risks had been taken by the private sector?

Baroness Hayman: My Lords, the development agreement which this Government inherited means that if LCR fails before it raises the funding for the construction of CTRL, the debts accumulated while it was in charge--the majority of which arise from Eurostar losses--revert to the public sector and to the Government.

Lord Bruce of Donington: My Lords, did the Minister just say that the Government, in agreement

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with the private sources of finance and with London and Continental Railways, agreed to underwrite in effect any default in borrowing? If that is the case, surely it must be that Parliament was seriously misled. According to the Financial Times of 12th February, the contingent liability has materialised at around £420 million. That is not peanuts. Why was it that the government of the day did not reveal that contingent liability, which they must have taken into account?

Baroness Hayman: My Lords, I cannot answer for the previous government as to what they revealed about the development agreement. Paragraph 4(c) of the explanatory memorandum stated that it involved the ability of the government to enter into direct agreements with LCR's financiers. I have just explained the effect of that to the House. The money that was raised by LCR for the design and development of the CTRL and the accumulated losses in operating Eurostar, if they were not refinanced by raising funding for the main project and if the development agreement failed, revert to the public sector.

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