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Lord Dixon-Smith: I thank the noble and learned Lord for his explanation. Perhaps he will allow me to press him on a narrow point. I accept the generality of his argument, but the specific point which causes concern is how the £500 million was arrived at. Clearly, it is an arbitrary sum. However, I am puzzled by the fact that the sum is the same for Scotland. As Scotland has double the budget, one might have assumed that the sums would be different.

Perhaps the noble and learned Lord would prefer not to have to answer that question tonight. He might prefer to reply to it by letter, because it seems entirely unreasonable, if one looks at fairness and proportionality, that the two separate organisations should have the same fund for emergency purposes.

Lord Falconer of Thoroton: It is an upper limit. When one is talking about remote and unforeseeable consequences, it is difficult to provide any mathematical or scientific basis. It simply seems to the Government to be a sensible figure to take for the upper limit. I can take the point no further. I shall not write to the noble Lord because that is as far as we can take it.

Lord Simon of Glaisdale: After dealing with important questions of public finance which the Committee has been canvassing, I feel diffident in raising a small drafting point on subsection (6). I feel all the more diffident because I have raised the matter previously in connection with other Bills without getting anywhere. But hope springs eternal in the legislative breast.

Subsection (6) states:

The words "with the consent of the Treasury" are utterly unnecessary. They turn up in Bill after Bill and are repeated in subsequent editions and in the Acts. Cumulatively, enormous sums are expended quite unnecessarily. It is only in the Wonderland of Whitehall that a Secretary of State would exercise a statutory power to increase a limit on lending without the consent of the Treasury. The words are included in Bill after Bill

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simply as a sop to Treasury paranoia, which is terrified that spending Ministers are in some way subverting its strict regime.

I invite the noble and learned Lord to say specifically whether he can conceive it possible that if the words were omitted the Secretary of State would increase the loan limit without consulting and obtaining the consent of the Treasury. That question can easily be asked and I invite the noble and learned Lord to answer it.

Lord Falconer of Thoroton: The noble and learned Lord, Lord Simon of Glaisdale, is right in saying that it is extremely unlikely that the Secretary of State would increase the limit without first obtaining the consent of the Treasury. Indeed, the Treasury controls all access to the loans fund and therefore it could be increased in practice only with the consent of the Treasury. But far from that being a reason for not including the words on the face of the Bill, surely it is a reason for including them. It means that the Bill sets out precisely what has to be done and who has to do it before the limit can be increased. Surely, accuracy in a Bill as to what is to happen is a good thing rather than a bad thing.

Lord Simon of Glaisdale: We have at least been given a reason this time. All too often the reason has been that the words are not necessary or, as my noble and learned friend Lord Mackay of Clashfern used to say, "not strictly necessary". To include unnecessary words in order to make things quite plain is not good enough in drafting. If we were going to adopt that course we should mention every consultation between any two Ministers. No one suggests that we should do that, not even the noble and learned Lord. Therefore, if the words are unnecessary it is no good saying that that is all the more reason for including them. It is not; it is a reason for omitting them.

Clause 84 agreed to.

Clause 85 agreed to.

Clause 86 [Destination of receipts etc.]:

Lord Elis-Thomas moved Amendment No. 210A:

Page 43, line 5, at end insert (", or
(c) as a result of the sale of any goods or services by the Assembly or any person or body acting on its behalf,").

The noble Lord said: This is a not very cunning and rather transparent attempt before supper to seek to enable the assembly to retain some resources which it might generate as a result of its own income-raising activities. That would provide it with a little entrepreneurial activity and give it some incentive. The sums that would result from the sale of goods and services by the assembly or on its behalf would not be substantial sums and not of the order set out in our earlier debate on emergencies. It would provide the assembly with a small source of income or revenue which would be of benefit to it in the carrying out of its services. I beg to move.

Lord Roberts of Conwy: It seems to me that the noble Lord has a very fair point. The assembly will have goods of which it may wish to dispose as surplus to

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requirements. It may also provide services for which it can charge. It would be a shame if all the proceeds disappeared into the Consolidated Fund.

Perhaps I may introduce another item into this amendment; that is, property. I presume that if the assembly were to sell property, the proceeds of the sale would be retained, I hope, by the assembly.

Lord Falconer of Thoroton: It may assist the Committee in considering Amendment No. 210A if I explain why Clause 86 is is in the Bill.

The general effect of legislation is that receipts earned by the Crown have to be paid into the Consolidated Fund. The Treasury, however, has the power under the Public Accounts and Charges Act 1891 to direct that sums do not have to be surrendered but may be used as if voted by Parliament.

Unfortunately, the provisions of the 1891 Act will not apply to the assembly because they relate only to government departments that prepare appropriation accounts. The assembly will not prepare appropriation accounts because it will obtain its funding from the Secretary of State and not directly from Parliament.

Clause 86 is necessary both to make it clear that the assembly's receipts are to be surrendered to the Consolidated Fund but also to provide for certain exceptions. One of those exceptions, which is Clause 86(6), is a power for the Treasury to direct that the assembly does not have to surrender certain receipts to the Consolidated Fund, in just the same way as it can direct the Welsh Office not to surrender certain sums now. The underlying principle is to ensure that the assembly will be in no worse position than the Welsh Office is now.

Amendment No. 210A makes the point that income from any goods and services that the assembly may provide must be retained by the assembly. However, the Bill can allow such income to be retained because it could be the subject of a direction under subsection (6). An example at the present time is the income which Cadw generates from entrance fees, sales of souvenirs and so on. Under a current Treasury direction, the Welsh Office is able to retain this income to help meet Cadw's running costs. These matters are better handled through Treasury directions, which have a flexibility that this amendment lacks. In view of my explanation, I invite the noble Lord to withdraw his amendment.

It goes without saying that the point that I have made in response to the amendment moved by the noble Lord, Lord Elis-Thomas, applies also to the remarks of the noble Lord, Lord Roberts of Conwy. Any property sold could be the subject of a Treasury direction which would permit the assembly to retain the receipts.

Lord Elis-Thomas: I am grateful to the noble and learned Lord for that response. I am pleased to understand that what I propose is covered by Clause 86(6) and that if the national assembly building were to be of such quality that souvenir models were to be sold worldwide, the assembly would be able to retain the

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revenue. On that basis, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 86 agreed to.

Clause 87 [Expenditure by Assembly]:

Lord Roberts of Conwy moved Amendment No. 210B:

Page 43, line 28, leave out (", or in connection with,").

The noble Lord said: This amendment tightens the wording of the clause and seeks to remove any laxity or ambiguity in the wording. Amendment No. 210B would ensure that the assembly shall incur expenditure directly only in the exercise of its functions. We seek to exclude the phrase "or in connection with" the exercise of any of its functions which seemed to us to introduce an element of laxity.

Amendment No. 210C seeks to eliminate any vagueness and concentrates expenditure on securing the attainment of the assembly's objectives. As it stands, the wording seems to us to be diffuse. We have highlighted what we consider to be a weakness in the clause which may allow a shade too much latitude in relation to expenditure and the proper control of it. I beg to move.

7.15 p.m.

Lord Falconer of Thoroton: These proposed amendments to Clause 87 should be seen in the context of Clause 41, which provides supplementary powers to the assembly to do anything which is intended to facilitate, or is conducive or incidental to, the exercise of any of its functions.

The effect of the amendments would be to restrict the assembly's expenditure specifically to the functions of the assembly, or to the attainment of objectives within the competence of the assembly. So the amendments would apparently preclude expenditure on such incidental action, notwithstanding that the Bill authorises such action. Therefore, the assembly can do things incidental to its functions but cannot pay for them if these amendments are accepted.

By tying its hands in that way, the assembly would not be able to support activities unless they were specified as functions, or linked to the attainment of objectives of the assembly itself. In this way, for example, the assembly would be unable to pay for the running costs of the assembly itself as this was not a function per se of the assembly. Nor would it be able to support the activities of another body which lay outside the direct competence of the assembly, but where the assembly had an important supporting role to play.

I am sure that the Committee would wish the assembly to have greater flexibility than is allowed for in these amendments, consistent with Clause 41, and I invite the noble Lord to withdraw these amendments.

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