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Lord Hardie: My Lords, I recognise the noble Lord's desire to ensure that digital signatures are included in the reservation on encryption. I can assure the noble Lord that digital signatures are in fact included as an area of policy reserved for the United Kingdom. It is therefore not necessary to refer explicitly to digital signatures in this schedule.

As the noble Lord observed, encryption has long been used by banks and is an essential tool for electronic commerce. Its uses include keeping electronic data--ranging from an e-mail that might be sent over the Internet to a file stored on a floppy disc--confidential.

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Another use, which is at issue here, is to prove that an electronic document was sent by someone holding a particular code and that the document has not since been altered. In other words cryptography can be used as an electronic signature.

I wish to point out that the Notes on Clauses state that electronic encryption covers the general use of encryption of communications or data in electronic form for the purposes of commercial confidentiality and authentication. The word "authentication", which means verifying who originated an e-mail or an electronic document, clearly relates to the use of encryption as an electronic signature. There is, therefore, no need to make this amendment.

Furthermore, I should point out to the noble Lord that a distinction is usually made between the terms "electronic signature" and "digital signature". Briefly, "electronic signature" has a wider meaning than "digital signature". So all digital signatures are electronic signatures, but not vice versa. The effect of this amendment might therefore be to limit the reservation to digital signatures but not electronic signatures. I doubt that this is what the noble Lord intends. In view of those reassurances, I hope that the noble Lord will feel able to withdraw his amendment.

Lord Selkirk of Douglas: My Lords, in view of the encouraging reply from the noble and learned Lord the Lord Advocate that the Bill as drafted covers digital signatures, I do not wish to press this matter. I am happy to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Sewel moved Amendments Nos. 214A and 214B:

Page 75, line 23, leave out from first ("of") to end of line 25 and insert ("Part III of the Police Act 1997 (authorisation to interfere with property etc.)").
Page 75, leave out lines 30 to 33.

On Question, amendments agreed to.

[Amendment No. 215 not moved.]

6.30 p.m.

Lord Sewel moved Amendment No. 215A:

Page 76, line 27, at end insert--
("( ) the subject-matter of section 1 of the Mineral Exploration and Investment Grants Act 1972 (contributions in connection with mineral exploration) so far as relating to exploration for oil and gas,").

The noble Lord said: My Lords, in moving this amendment I shall speak also to Amendments Nos. 215C and 226D.

Amendment No. 226D clarifies that the Scottish parliament can legislate on financial assistance to industry for the purpose of promoting or sustaining economic development or employment. That would, among other things, enable the parliament to make provision of a general nature which permits such assistance to industries, including those which operate in reserved areas. The parliament will not, however, have competence to legislate for such assistance specifically in relation to a reserved commercial activity.

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Clause 52 lists powers which are to continue to be exercisable by Ministers of the Crown despite the Clause 49 transfer of functions. Amendments Nos. 215A and 215C simply clarify the extent to which financial assistance under Section 1 of the Mineral Exploration and Investment Grants Act 1972 and under Sections 10 to 12 of the Industry Act 1972 will transfer under Clause 49 and, therefore, be exercisable concurrently by virtue of the references to those provisions in Clause 52. I beg to move.

On Question, amendment agreed to.

Lord Hardie moved Amendment No. 215B:

Page 76, line 39, leave out ("deposits in the sea") and insert ("activities").

The noble and learned Lord said: My Lords, noble Lords will recall that during Committee the Government tabled, and the House accepted, an amendment to the oil and gas reservation reserving Part II of the Food and Environment Protection Act 1985 so far as it relates to oil and gas exploration and exploitation in relation to deposits in the sea outside controlled waters. The purpose of that amendment was to remove any doubt that the oil and gas reservation should catch operational discharges from oil and gas installations and the deposit in the sea of oil-related articles such as redundant oil installations which are potentially subject to regulation under Part II of the Act.

Our earlier understanding had been that "deposits in the sea" would cover all types of potentially polluting activity relating to oil and gas exploration and exploitation covered by that Act. However, we have reflected further on this point and we now consider that this may not be the case and that it would be safest to use the word "activities". The use of the word "activities" instead of "deposits in the sea" makes it clear, for example, that the flaring and incineration of waste gas and fugitive emissions are also covered by the reservation. This amendment is merely clarificatory. I beg to move.

On Question, amendment agreed to.

Lord Sewel moved Amendment No. 215C:

Page 77, line 4, at end insert--
("( ) sections 10 to 12 of the Industry Act 1972 (credits and grants for construction of ships and offshore installations),").

On Question, amendment agreed to.

[Amendment No. 216 not moved.]

Baroness Ramsay of Cartvale moved Amendment No. 216A:

Page 78, leave out line 15.

The noble Baroness said: My Lords, grants in respect of bus fuel duty rebate were previously regarded as a tax matter and, as such, it was right to reserve them. However, as a result of a ruling from the Office of National Statistics and the Treasury, grants in respect of bus fuel duty rebate have now been reclassified as public expenditure with responsibility for this expenditure transferred to the Scottish Office. In the circumstances, it is appropriate

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that, following devolution, the Scottish parliament should also have responsibility for such grants in line with its general responsibility for bus policy. I beg to move.

On Question, amendment agreed to.

Lord Mackay of Ardbrecknish moved Amendment No. 217:

Page 78, line 15, at end insert--
("Tolls or charges for the use of Trunk Roads.").

The noble Lord said: My Lords, in moving this amendment, I shall speak also to Amendment No. 218.

I start with Amendment No. 218. In Committee we discussed this matter and I believe that we were at cross-purposes. This part of the Bill seems to suggest, or at least to me it does, that the Scottish executive could decide to increase the amount of money which must be paid by an insurance company or, indeed, by an individual in respect of health treatment after a road accident. Currently, health boards may claim, up to a ceiling of £2,949, any money due for the treatment of a road accident casualty. That is normally paid by the vehicle insurance company.

In Committee, I was not arguing that the money should go to the UK Government. I am quite content that the money, up to the ceiling, should go to the Scottish health boards, as it does at present. I was concerned about the Scottish parliament and the executive having the power to increase that ceiling quite separately from the UK. That may create a situation in which in Scotland the ceiling was, for example, £5,000, whereas in England it was only £2,900. I asked the noble and learned Lord the Lord Advocate what consequences that would have on car premiums in Scotland.

I did not seem to be arguing my case very well. I did not manage to convey that the insurance companies might consider that they were open to greater liabilities, and therefore, as is the nature of insurance, the premiums would be increased to cover the liabilities. I asked whether I was right that that possibility existed and whether the Government had discussed those matters with the insurance companies. The noble and learned Lord was unable to help me with that. I suggested that the Government should reflect further on the issue. I have tabled this amendment to see whether the noble and learned Lord the Lord Advocate can clarify the matter.

Have the insurance companies been consulted? Is there not a danger that they will load the premiums of Scottish drivers? If the Scottish parliament were to take that power and increase the payment demanded, would not the insurance companies then increase their premiums? They already increase the premiums depending on where one lives. If one lives in the centre of a city, the insurance companies, probably quite rightly, have decided that the danger of theft and accident is greater than if one lives in the countryside. Therefore, the premium is greater if one lives in the city. It is that loading about which I am concerned, if the delegated power means what it says.

I turn back to Amendment No. 217. I had not even thought about this matter until I saw an article in the Scotsman on Monday 19th October which told me that the Government were considering using the M.8 as a pilot scheme for road tolling by electronic means. The

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suggestion there was that the Scottish Office would launch one of two pilot schemes for electronic charging in Britain on the M.8. It seemed to me a rather interesting prospect that the Scottish parliament, in search of more money, could introduce tolling on the trunk roads of Scotland in order to get more money from motorists. I believe that trunk roads should be dealt with on a UK basis and I hope that the UK Government are not considering making the Scottish motorist the test-bed for electronic charging.

Needless to say--and I shall not bore the Minister by reading it--Mr. Alex Salmond was already making hay on the basis of that proposition on 19th October and he would make even more hay if it came about. I want to be clear as to who would have the power to introduce electronic or other tolling on trunk roads in Scotland. Would that be something the Scottish parliament could do or would it be something which only the United Kingdom Parliament could do? My amendment proposes to reserve those matters to the United Kingdom Government. I beg to move.

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