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The Earl of Longford: My Lords, before the Minister sits down, perhaps I may venture to ask whether my noble friend is aware that anyone who visits prisons once or twice a week, as I do, has seen no improvement since Labour came into power.

Lord Williams of Mostyn: My Lords, I visit prisons regularly. I dispute what my noble friend says. It is not the evidence I hear and see on every occasion. I further pay tribute to what members of the Prison Officers' Association are doing in conducting new, vigorous courses which are a distinct improvement for many young men in the Prison Service today.

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Official Report of the Grand Committee on the

Commonwealth Development Corporation Bill [H.L.]

Tuesday, 12th January 1999.

The Committee met at half past three of the clock.

[The Deputy Chairman of Committees (Lord Ampthill) in the Chair.]

The Deputy Chairman of Committees (Lord Ampthill): Before I put the Question that the Title be postponed, it may be helpful to remind your Lordships of the procedure for today's Committee stage. Except in one important respect, our proceedings will be exactly as in a normal Committee of the Whole House. We shall go through the Bill clause by clause; noble Lords will speak standing; all noble Lords are free to attend and participate; and the proceedings will be recorded in Hansard. The one difference is that the House has agreed that there shall be no Divisions in this Grand Committee. Any issue on which agreement cannot be reached should be considered again at the Report stage when, if necessary, a Division may be called. Unless, therefore, an amendment is likely to be agreed to, it should be withdrawn.

I should explain what will happen if there is a Division in the Chamber while we are sitting. This Committee will adjourn as soon as the Division bells are rung and will resume after 10 minutes.

Title postponed.

Clause 1 [Initial steps by Secretary of State]:

The Lord Redesdale moved Amendment No. 1:

Page 1, line 6, after ("day") insert ("not later than four years after the day on which this Act is passed").

The noble Lord said: I start with a simple probing amendment. The timescale of four years which I chose seemed applicable. I realise that the sale of the CDC will not take place; indeed I do not believe that the CDC will look for potential investors until the back end of the year 2000. After that the Secretary of State will have to choose a time for the sale to take place which is most advantageous to the CDC.

However, there is nothing in the Bill that places a limit on when the sale should take place. Therefore there is the danger that the CDC could be left in limbo for a period of time once this Act comes into force before the Secretary of State has proposed the date and time of the sale. The purpose of this amendment is to obtain some assurance from the Minister. I realise that we would not undertake this Bill if the sale was not to take place as soon as was advantageous. However, I should like some indication of the likely timescale of such a sale. I beg to move.

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Baroness Amos: I agree with the noble Lord, Lord Redesdale, that it is important that we proceed with the transformation as soon as is practicable after the enactment of the Bill. I should like to reassure him that there is no danger that the CDC will be left in limbo. It is intended to proceed with the transformation as soon as is practicable after the Bill has been enacted. We shall need to undertake a number of administrative steps before transformation can be effected, some of which are quite simple. The only reason not to proceed quickly would be if some unforeseen major difficulty arose which would not make it appropriate so to do. In that case it would not be helpful to have an enforced time limit. As the noble Lord said, we would not proceed with this Bill if we wanted a delay. In view of my comments I hope the noble Lord will feel able to withdraw his amendment.

Lord Redesdale: I thank the noble Baroness for that reply. That was the assurance I sought. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 1 agreed to.

Clauses 2 to 15 agreed to.

Baroness Rawlings moved Amendment No. 2:

Before Clause 16, insert the following new clause--

Review of Corporation's overheads, etc

(" . No securities in the Corporation shall be issued until the Secretary of State has commissioned from a leading firm of consultants a comprehensive review of the Corporation's overheads, working practices and main office records of efficiency measures to maximise private sector investment potential.").

The noble Baroness said: I would like to thank the Minister for the opportunity to discuss this Bill in greater detail and also to thank him for his clarifications during the Second Reading.

First, we need to clear up a misunderstanding. During the Second Reading debate, the Minister felt that I did not understand the difference between part privatisation and public/private partnership. He explained, too, that the difference between the two lies in the destination of the proceeds. That is highly innovative semantics, which I cannot accept.

The Oxford English Dictionary, under the heading "privatisation", refers only to the source of money, namely, the private sector, and not its destination. The label "partnership" appears to suggest that the public and the private sectors are on an equal footing. In this case, this is not true, as the public partner has powers to veto changes on crucial areas, such as the investment policy, the business principles, the right to appoint directors and their number. This verges on the "control freak" attitude which is characteristic of much of new Labour's approach towards private partners. I appreciate that the rationale attached to the golden share is to entrench the development focus of the CDC, but it may well dampen private sector interest.

We are not here, however, to make an issue of labels dreamt up by spin doctors. As stated during the Second Reading, we welcome the Bill, and we want to make sure that the operation will be successful. The intention

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behind our amendment is to air the issues more fully and to suggest a mechanism which will ensure the successful launch of the CDC in the private sector. I beg to move.

Lord McIntosh of Haringey: I am grateful to the noble Baroness for the support she has expressed again in principle for the Bill and most of its provisions.

Let me start by referring to her point about privatisation and public/private partnership. I am perfectly prepared to accept the dictionary definition in relation to the source rather than the destination of the proceeds, although it is a hugely important political point that we want to make, and perhaps I chose the wrong occasion to make it. Any proceeds from the private sector will go into the development budget rather than into the Treasury pot.

Even in semantic terms, I do not agree with the noble Baroness that partnership requires that the partners should be on an equal footing. There can be minority and majority partnerships, and this is indeed what is proposed in this Bill. It is proposed, in primary legislation, that the participation of Government in the ultimate partnership shall be not less than 25 per cent, which is deliberately a significant element and justified by the word "partnership". In that context, I am a little surprised that the noble Baroness has proposed in Amendment No. 6 that the participation of Government should be capable of being reduced to 5 per cent rather than 25 per cent. I suspect that the noble Baroness's preference for part privatisation is wish rather than reality, because that is the direction in which the noble Baroness's later amendment would move us.

On the specific issue of Amendment No. 2, we entirely agree with the noble Baroness that every attention should be paid to the need for value for money. However, we have difficulty with the wording of the noble Baroness's amendment, but in the context of the Moses Room I need not make too much of that. What is a leading firm of consultants? What are they consultants in? Are they management consultants, accountancy consultants, financial consultants, dare I even say marketing consultants? What do the words "leading" and "comprehensive" mean? There are many relatively trivial difficulties with which I need not detain the Committee. However, we recognise the importance of questions of efficiency and value for money, and we shall have regard to these issues in preparing for the public/private partnership. We expect to "benchmark" the CDC against similar organisations, which means, of course, that if it were appropriate to use outside consultants we would not hesitate to do so. Despite being a little aggressive in my opening remarks, as was the noble Baroness, I generally express support for the thinking behind her amendment. However, I ask her in the circumstances to withdraw it.

Baroness Rawlings: I thank the Minister. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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Clause 16 [Requirement to issue securities]:

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