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Lord Kirkhill: My Lords, I have just one question for my noble friend the Minister. When these regulations are brought into force, what oversight will there be to ensure their implementation?

Baroness Byford: My Lords, from these Benches, I welcome the regulations introduced by the noble Lord, Lord Hoyle. I shall reinforce the point he made; that over the years British farmers have led the way in how we look after livestock. Being a former farmer, that comes right from the heart. It is in no one's interests to fail to look after one's animals. I am sure that the regulations will be welcomed by the farming community.

The noble Lord referred to the fact that the previous government initiated the moves in 1990. Like him, we were disappointed that the EU took another year before

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it agreed to follow our example. We are even more disappointed that the regulations will not be implemented until 2006. As the noble Lord, Lord Beaumont, said, calves will continue to suffer in the meantime.

The regulations cover accommodation, diet, tethering, group living, space allowance and cleanliness and good management. I have one or two questions for the Minister. I accept that we have laid down different standards from our European colleagues. For example, on room, the directive requires that beasts from 150 kg to 200 kg need 1.7 square metres, whereas the regulations suggest 2 square meters; and for heavier calves the directive requires 1.8 square meters compared to 3 square meters in the regulations. Is not the Minister concerned that we should all be working to the same standard? I accept that our farmers set high standards, but in the long-term welfare interest of animals, do not the Government consider that we should all be working to the higher standards that we have set?

The Minister referred also to diet. The noble Lord, Lord Hardy, referred to the sufficiency set down by the EU. The committee considered that the quantity set might not be sufficient.

The Minister spoke about tethering. The regulations have accepted that calves need to be tethered for a period of not more than one hour in order to feed them milk or milk substitute. It is important that tethering be allowed, because even calves bully one another. We do not want calves not to have the chance to feed so we are pleased that tethering will be allowed, but will be for feeding during a limited period only.

On longer-term tethering, there will be a cost implication for farmers. The Minister referred to that. Perhaps he will enlarge on the point when he responds, because he did not specify how those costs would be laid down. The Minister spoke also of trying to encourage the more rapid implementation of some of the regulations. We would obviously welcome that. We appreciate that in this country the regulations will come into force in 2004.

Finally, whatever we do, we want to ensure that our farmers are playing on a level playing field. We do not want them to have greater restrictions so that from a competitive point of view they will find their hands tied behind their backs in comparison to their European colleagues. I do not know whether that is something upon which the Minister would like to comment. In general, we welcome the regulations, as I am sure will our colleagues in the farming industry. Perhaps I may reiterate that British farmers have led the way, and we hope that others will follow more rapidly than they have shown an inclination to do so far.

8 p.m.

Lord Hoyle: My Lords, I am pleased with the welcome that has been given to the measure. Everyone who has spoken looks forward to the phasing out of crates. The only question raised is the length of time. We, too, would like to have seen them phased out earlier, but at least a start has been made and it is coming about.

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I welcome the words of appreciation to Ministers from my noble friend Lord Hardy. The regulation applies to all the states of the European Community. The noble Lord, Lord Beaumont, welcomed certain factors that had occurred. He also asked why we appeared to be lagging behind with regard to recommendations by the European Union Scientific Veterinary Committee. It recommended a minimum level of 100 grammes of roughage per day from two to 15 weeks of age, increasing to 250 grammes from 15 to 26 weeks. Our regulations are compatible with that recommendation. Our regulations additionally require the daily ration to increase in line with the growth of the calf. The Scientific Veterinary Committee commented that it would be better for double the minimum amount of roughage to be fed to calves. We wholeheartedly agree with that view. In practice, our industry provides at least twice that minimum figure.

The noble Lord also asked whether the Scientific Veterinary Committee recommended a higher minimum haemoglobin level. I have to say no. Many studies into provision of adequate iron and the avoidance of anaemia were considered by the Scientific Veterinary Committee. Many of those studies indicated impaired performance and an increased disease susceptibility in calves whose blood haemoglobin concentration was below 4.5 millimols per litre. The Scientific Veterinary Committee therefore recommended that calves be fed sufficient dietary iron to maintain the haemoglobin concentration at a minimum level of 4.5 millimols per litre until slaughter. We believe that we meet that level.

The noble Earl, Lord Kinnoull, was kind enough to inform me that he would depart from the regulations in speaking about horses. There is to be a Question on the issue tomorrow. In the meantime perhaps I may say this. The answer that we have received in relation to ourselves is that veterinary medicines for which no MRLs are set are not banned under the regulation. As he rightly said, they may not be used on any animal intended for human consumption. However, the Commission has also issued a statement confirming that they may be used on an animal not intended for human consumption. Perhaps I may quote from the statement:

    "It is not the intent of regulatory authorities to deprive veterinarians of the possibility of treating animals. When guarantees can be given that horses will not be consumed, there is no obligation for any form of maximum residue levels".
I hope that that sets at rest the fears that noble Earl expressed tonight, and will give him some comfort. I know of his interest in horses.

I have also been asked how the regulations are to be implemented. In this country, the enforcement role will be carried out by the State Veterinary Service. Veterinary inspectors will enforce the regulations by making ad hoc inspections. They will also make additional inspections in response to complaints or allegations of poor welfare or breaches of the regulations. The basis of the SVS policy enforcement will be the same as for other welfare legislation. Advice will be given to rectify minor contraventions, but prosecutions will always be recommended where there is evidence of cruelty, pain or distress. I hope that that reassures the noble Earl.

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The noble Baroness on the Opposition Front Bench raised the subject of higher standards. We have always been ahead in relation to Europe, as she acknowledged. Consultations took place. With regard to consultations on the increased space allowance, we received no adverse comments.

The only question in relation to tethering was the cost to the industry. We estimate a cost of about £78,000. There was another increased cost for the maintenance and provision of fences. We do not believe that the cost will be too damaging to the industry. Perhaps I may say this to the noble Baroness: it is one ban that will come into effect immediately. As I am sure she is aware, it should have been implemented by 1st January 1998. Because of our consultations, we have been late in bringing the measures forward.

We are concerned about a level playing field. We do not believe that these regulations pose an undue burden. That was not indicated in the consultations.

I am pleased with the welcome the regulations have received. Perhaps I may say, finally, that, like all noble Lords in the House, I hope that eventually there will be an end to veal crates. In response to those who asked what will happen when exports are renewed, we cannot ban the export of calves but we hope that increasingly it will not be livestock that is exported but meat and meat processing products. I commend the Motion.

On Question, Motion agreed to.

Air Carrier Liability Order 1998

8.9 p.m.

The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Baroness Hayman) rose to move, That the draft order laid before the House on 23rd June be approved [38th Report from the Joint Committee].

The noble Baroness said: My Lords, the proposed order in council has been drafted to fulfil our Community obligations in response to Council Regulation 2027/97, which enters into force later this year. The order was considered by the Committee for Delegated Legislation in another place on 24th June and approved by a majority.

Council Regulation 2027/97, on air carrier liability in the event of accidents, was adopted last year and enters into force on 17th October 1998. It was introduced as a reaction to the unrealistically low liability limits presently set by the Warsaw Convention and to harmonise the national regimes which various member states have installed as a consequence. It provides greater consumer protection by setting out a new liability regime applicable to Community air carriers.

The three main elements of the regulation are: the abolition of an upper limit for claims arising from the death, wounding or other bodily injury of a passenger--the carrier has absolute liability for the first 100,000 SDRs (approximately £82,000) of any claim and the burden of proof for higher amounts; secondly, a requirement for all Community air carriers to make prompt advance payments in the event of an accident,

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to make available to passengers adequate information on the new liability regime and to summarise these requirements on the ticket document or an equivalent; and, thirdly, in the case of non-Community carriers, which do not (voluntarily) apply the regulation, to inform passengers expressly and clearly thereof at the time of ticket purchase and to provide passengers with a form setting out their conditions. It does not replace the Warsaw Convention, which continues to apply in respect of matters not covered by the regulation and as between each member state and non-Community countries.

The regulation will be directly applicable to all carriers concerned when it comes into force and does not require implementing legislation as would be the case for a directive. However, member states are obliged to remove conflicts with national law and to impose appropriate, effective and dissuasive sanctions for non-compliance. Where possible, the sanctions should be analogous to similar provisions in national law. Failure to impose such sanctions would leave the United Kingdom open to infraction proceedings by the Commission and also possibly liable in damages if anyone suffers financial loss as a result of our failure to implement the regulation correctly.

An order in council has therefore been drafted to meet these obligations by amending the Carriage by Air Act 1961, the Carriage by Air Acts (Application of Provisions) Order 1967 and the Licensing of Air Carriers Regulations 1992 to remove conflict with legislation giving effect to the Warsaw Convention in the UK; and by imposing criminal sanctions for non-compliance in the form of a fine in a magistrates court, which currently cannot be more than £5,000, or an unlimited fine in a Crown Court.

I recognise that there has been both concern and controversy over those issues. However, I stress that the Council regulation will provide Community air travellers with more realistic protection in the event of an accident. The information requirements set out in the regulation will ensure that passengers are clearly informed of their rights. The order removes conflict with existing United Kingdom legislation and provides the necessary powers of enforcement. I therefore commend it to the House.

Moved, That the draft order laid before the House on 23rd June be approved [38th Report from the Joint Committee].--(Baroness Hayman.)

8.15 p.m.

Lord Brabazon of Tara: My Lords, first, I should declare an interest as a director of a company which owns a small airline in the Channel Islands, which I have no doubt will be affected in one way or another by the order.

This order was laid before the House on 21st June but that was not the first order that was laid. The original order was laid before that. It was then taken away and relaid on 23rd June. And yet two weeks later, today, we have the order which is full of manuscript amendments. How can it be that in the two weeks intervening between

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the laying of the second order--the one we are debating today--and today, we do not even have a proper printed copy of this order?

We are considering an example of bureaucracy at its worst. This is not a matter of policy but of red tape and worse still, gold plating. We all know about gold plating.

We have an EC regulation which enshrines in the national law of all Community states the principle of unlimited liability for airline passengers in the case of death or injury. That is a principle established by the airlines themselves in the 1997 inter-carrier agreement which the EC regulation serves to endorse. Therefore, there is absolutely no argument about the case for unlimited liability. That is not an issue of the order today. That is already in place and happening now.

We also have a draft order to require under United Kingdom law, and only under United Kingdom law, that a specific wording drawing that to passengers' attention must be included on the tickets of all EC airlines operating into this country or, in the case of non-EC airlines, drawing attention to the fact that they may not have waived their limited liability. I repeat that this EC regulation is not an issue of principle, which, by its very being, is in any event a part of UK national law, as the noble Baroness said in her opening remarks, but is concerned with the form of words drawing it to people's attention. Under this draft order, failure to comply means that an airline is held criminally responsible.

It may be useful to noble Lords to appreciate what we are talking about here. Already there are two notices on airline tickets relating to passengers' rights in case of death or injury. One is the standard IATA notice required by the Warsaw Convention; the other is the specific notice required for all flights to an from the United States. The EC regulation will require a third notice. Funnily enough, the industry recognises that that is not exactly consumer friendly.

Even as we debate this order, a meeting of the Passenger Services Conference, a forum within IATA, is under way in Geneva. It is trying to agree a wording for airline tickets which will meet the requirements both of IATA and the new EC regulation which, as the noble Baroness said, comes into force in October. It may also meet US requirements. That would mean one ticket notice, no confusion and simplicity for consumers. I do not know how those discussions are going, but it is not a straightforward matter. Once the IATA airlines have agreed a wording, that is then subject to approval by their governments. That means virtually the whole world. There are certain key authorities which must approve it and, ironically, one of those is the EC whose regulation the UK Government are now rushing headlong to gold-plate.

There is no guarantee that all the world's governments will approve it at first sight. They may ask for it to be changed in certain ways. They may disapprove it altogether. Such is the nature of international negotiations. But it is the best way to achieve a solution which will be both simple for consumers and practical for airlines.

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Surely our Government should put their effort and resources into supporting that process and encouraging key players on the world scene, particularly the United States and the EU, whose specific requirements for ticket notices are at the heart of the debate to find a common solution. Instead, the Government's blinkered paranoia appears to be directed towards ensuring that they cannot be accused of failing to interpret the EC regulation to the letter. The provision requires airlines operating in and out of the UK to have an appropriate ticket notice by October. No matter what the rest of the world may be doing, the UK must be 101 per cent. compliant by October. There is no stopping to consider what the international community is already doing to address that new situation; no consultation with the industry to consider the practical implications. UK airlines, for which it will be most burdensome, will inevitably find a solution to appease the UK authorities. However, foreign airlines will be unlikely to accept the UK wording or to formulate their own in time to secure UK government approval. What a mess it seems to be.

In justifying that in Standing Committee in another place, the Minister admitted that an EC regulation does not require implementation. It was argued that because of Article 5 of the EC treaty and a case which the Government called the Greek maize case, the UK is not only under a duty to implement the EC regulation but must also impose sanctions which are "effective, proportionate and dissuasive". It was alleged first that, if that were not done, the UK might be liable to damages if anyone suffers financial loss as a result of failure to implement the regulations correctly; and consumers' rights may be impaired. Neither of those allegations is realistic for the simple reason that the consumer benefits which take effect in October will be part of UK law automatically without any implementation measures.

As I said before, it is significant that so far no other member state is known to be considering either implementing the measures or, in particular, criminal sanctions. The possibility of the United Kingdom being liable to make good financial loss is usually only relevant in the context of a state which fails to implement an EC directive, which always requires implementation, and not an EC regulation, which does not.

It is also surprising that the Government rely on the so-called Greek maize case, which was a very extreme undefended case involving Greek officials fraudulently concealing the true origins of maize from Yugoslavia, failing to levy the correct duties, failing to pay what was due to the Community and Greece failing to prosecute the fraudulent officials. That is rather different from failing to print on the back of a ticket the new requirements; in fact it is a lot worse.

The United Kingdom apparently turns a blind eye to the more relevant decisions of the European Court of Justice, which expressly disapprove of efforts to implement regulations by reproducing the text word for word. Even the slightest difference in operative date is forbidden.

I am also well aware that the Government are under no obligation to consult on this matter, but sheer common sense suggests that it would have been prudent

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to do so in a matter of such practical complexity and international impact. The industry was consulted on the regulation but not on the Government's decision to introduce this draft order. I have seen many representations made by many sectors of the travel trade and I have read the report in Hansard of the Committee debate on this matter in another place. I find it staggering that so many genuine concerns and thoughtful objections were dealt with so dismissively by a Government which have staked their reputation on openness, transparency and participation.

Notwithstanding the fact that it would appear to make eminently good sense to await the outcome of the international negotiations--as all other EC member states appear to be doing--this order will create enormous practical problems for airlines and for the travel agents who issue 85 per cent. of airline tickets in this country. Can the Minister say whether any other member state is introducing such legislation, let alone making a criminal offence of it? Can the Minister say whether it will be possible to adjust ticketing systems worldwide, bearing in mind the complexity of that procedure in the time available, and can the Minister confirm that no compliance cost assessment was done on the impact of the order?

Above all the order is simply unnecessary. The United Kingdom does not need to introduce such legislation in order to comply with its obligations under EC law. I have a copy of an independent assessment, prepared for British Airways by a prominent firm of aviation lawyers, which states this quite clearly.

This order will only be relevant temporarily, from the implementation of the EC regulation in October until such time as an international ticket notice is agreed. At that point, because the agreed ticket notice will be included on the IATA common ticket stock used by all the world's airlines, it will be impossible to be non-compliant.

Even when airlines in Europe began to raise limits from 1966 onwards, no European government required airlines to give notice to passengers of increased limits. The United Kingdom went even further when applying simplified Warsaw rules to domestic carriage from 1952 onwards: all ticket and notice requirements were deleted. Thus it is a completely retrograde step for the EC regulation to require airlines to inform passengers that by law limits are no longer applicable. This will introduce a completely new requirement in domestic carriage--for example, London to Manchester or London to Edinburgh--and it will frustrate present experiments in ticketless travel. Forty-six years of legal freedom from documentary requirements and domestic carriage will come to an end. Can the Minister comment on that situation? Will it no longer be possible to have ticketless travel within the United Kingdom under these new regulations?

Let us not forget that many airlines have been voluntarily applying the spirit of this regulation since the signature of the Inter Carrier Agreement 1997. Indeed a number of airlines already declare in their contracting documents that their liability is unlimited, so

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it is hardly likely that for the sake of a few months until that international agreement is reached, they need to be kept in line by such draconian measures.

Even if the Government feel that they still need this big stick with which to threaten the airlines, they only have to look at Article 7 of the regulation, which states that in two years the whole regulation must be reviewed and may be revised in the light of the economic climate which will prevail at that time.

In the meantime, given all the difficulties, both local and international, that I have outlined, I would welcome the Minister's assurance that this order will be applied with circumspection and any enforcement undertaken in a reasonable and practical way; but, better still, I urge the Minister even at this late hour to withdraw the order, which is unnecessary because the regulation will come into force without the need for any order such as this. We should wait until the outcome of the international negotiations.

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