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Baroness Hamwee: My Lords, I gather that noble Lords support the regulations but share the concern about particles. Will the Minister tell the House what monitoring is to be carried out by his department and what steps will be taken if it is clear that the various targets will not be met in time; in other words, might there be a repeat of the particles target downgrading?

I share also the concerns to ensure that local authorities are adequately resourced to deal with monitoring. I should welcome assurances that the cost to local authorities of implementing local air quality strategies will be fully funded. Will the Minister tell

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us--perhaps this is a rather wide question for this point in the proceedings--how those targets dovetail with the Government's climate change strategy?

I have two comments, which are also in part questions, which arise from local experiences. I was at a meeting in West London last week to discuss the effect of aircraft noise and other pollution from aircraft on people who live under flight paths and near to airports. Comments were made about aircraft fuel by neighbours of Heathrow Airport. As aircraft line up to take off, one can smell and taste the fuel. How is it measured? What are the effects on people of being exposed to aircraft emissions?

My second point is that many schools--including many primary schools--are located on main roads. Parents are concerned about the effects of pollution from traffic on children in playgrounds or using school premises. Can the Minister send me away with reassurances about that, particularly given the problems relating to PM10s?

Lord Whitty: My Lords, I am grateful for the relatively short contributions this evening. In response to my noble friend Lord Simon, it is of course true that other sectors beside the transport sector contribute to CO 2 emissions. The transport sector creates emissions which particularly affect local air quality, which is the subject of these regulations rather than CO 2 itself. As the noble Baroness, Lady Hamwee, hinted, CO 2 is covered by a separate strategy which we set out in great detail a few days ago in our climate change programme which is for discussion now. It covers the whole range of new approaches to restriction of CO 2 , including the area of cleaner fuels to which my noble friend Lord Simon referred.

With regard to the relative importance of transport and other areas in this context, it is true that other areas make a greater contribution to the deteriorating situation in relation to CO 2 , but it is mainly the contribution from transport which is rising at a substantial rate. That is not entirely offset by the increased fuel efficiency in vehicles as they come onstream.

The noble Lord, Lord Brabazon, raised the costs to local authorities of pursuing the programme. If he sought a breakdown of the distribution of the £12 million to particular local authorities, I fear that I cannot give it to him tonight. We are confident that that figure is sufficient to meet the objectives. We are in constant co-operation with the LGA and local authorities on those matters. If there are particular problems, we shall seek to address them.

The noble Baroness, Lady Hamwee, asked about monitoring. There is continuous monitoring of the programme. It is unlikely that there will be changes in any short-term objectives or any of the objectives to which the present programme refers. It was difficult for us to meet the targets relating to particles. However, we have not downgraded the target. We have adopted the European target. That is an objective that we are still seeking to achieve.

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On aircraft pollution, in the monitoring and measurement of air pollution, the effects of pollution from aircraft register. It is true that, although pollution from aircraft is relatively small in proportion to the total amount of pollution, in terms of local pollution and in terms of CO 2 it is growing rapidly and I believe that the international community will have to address it seriously.

I hope that I have answered most of the points that have been raised.

On Question, Motion agreed to.

Audit Commission's Code of Audit Practice: March 2000

8.30 p.m.

Lord Whitty rose to move, That the draft code laid before the House on 9th March be approved.

The noble Lord said: My Lords, this is a new Code of Audit Practice for local authorities and the National Health Service in England and Wales.

The code is the Audit Commission's document. As statute requires, it has been prepared by the independent commission to be used by the independent professional auditors which the commission appoints to audit local government and National Health Service bodies.

In essence the code is two codes. First, it replaces the existing Code of Audit Practice, which ceases to have effect on 21st July, and the new code prescribes the way in which external auditors must carry out their financial audit tasks. Secondly, it is a code that deals with best value and the responsibilities of local authority auditors in relation to the audit of the new best value performance plans and the best value regime.

In preparing the code, the commission has taken account of wider audit developments. It reflects the increased risk-based approach to audit, auditors' new responsibilities in relation to regularity in NHS bodies, increased emphasis on work related to standards of financial conduct within audited bodies and the new duty to audit best value performance plans.

The code covers all aspects of auditors' responsibilities and sets out the general principles to be followed by auditors; the audit framework within which auditors will carry out their responsibilities; and auditors' responsibilities in relation to reviews on the financial aspects of corporate governance, the audit of the accounts and reviews of aspects of performance management.

It is the responsibility of audited bodies to put in place suitable arrangements to ensure the proper conduct of their financial affairs. Auditors must review those systems to ensure that they are adequate to maintain the legality of transactions and that the financial standing of the body is soundly based.

The code also sets out auditors' responsibilities for reviewing the aspects of performance of audited bodies. Auditors review and report on the

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arrangements in place to secure economy, efficiency and effectiveness in the use of resources. From 1st April auditors in local government will audit the new best value performance plans which all bodies must prepare and publish.

The code will come into effect once approved by this House. It will apply to all audits currently in progress and to the audits for the financial year commencing on 1st April 2000. A transitional annexe sets out the guidance for audits currently in progress. Essentially, that is the guidance from the existing code that is being re-approved for this transitional period to provide continuity for work in progress. I beg to move.

Moved, That the draft code laid before the House on 9th March be approved [13th Report from the Joint Committee].--(Lord Whitty.)

Lord Brabazon of Tara: My Lords, we broadly welcome this. It is the first time that a document like this has been introduced as an order, which must be good. Again, I have prepared a speech which I shall not make in view of the lateness of the hour and the events that have taken place this evening. I am sorry that there are not more noble Lords in the House to take account of this great event. Nevertheless, we have to put up with what we have. Perhaps I should rephrase that.

Baroness Hamwee: My Lords, I believe the noble Lord is looking for words such as "feel the quality"!

Lord Brabazon of Tara: My Lords, never mind the quality feel the width! I am told that there is a national shortage of auditors. It could be said that one of the Government's lasting achievements will be that they have created a massive increase in the auditing industry. However, we support the order and we support the document. It covers not only local government but also the National Health Service. With all the promises that have been made for the National Health Service, it will be even more important that this is taken forward.

Baroness Hamwee: My Lords, we too support the order. I make one comment. I note that in the section dealing with best value performance plans, paragraph 74, the statement is made that,

    "Auditors should meet this responsibility by reviewing, and where appropriate examining evidence relevant to ... the adequacy of the systems that the audited body"--

local authorities, by and large--

    "has put in place to collect and record specified performance information".

As we said during the passage of the Local Government Act 1999 which introduced best value, we believe that it is important that the performance indicators that are applied are not so standardised that they become inappropriate to different local circumstances. We believe that best value should be a means of local authorities developing the appropriate indicators for their own circumstances. We hope that the Audit Commission will be a helpful part of that

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process rather than a process of standardisation that may fail to recognise what is truly best value in different circumstances.

Lord Whitty: My Lords, I am grateful to the noble Lord, Lord Brabazon, for recognising the historic importance of this small assembly here tonight. It is important that the code of practice receives parliamentary approval and it is important that we note that it covers the National Health Service and the introduction of the best value provisions. In relation to the National Health Service, the Audit Commission is clearly carrying out a task on behalf of Parliament, and therefore it is slightly different from the audit situation in relation to local government.

The noble Lord claims that there is a shortage of auditors. There are some difficulties in the private sector in auditing private companies, but I believe that by organising its work effectively the Audit Commission will be able to carry out these tasks.

In relation to the point raised by the noble Baroness, Lady Hamwee, about the nature of the indicators, we believe that the best value regime will allow a degree of flexibility of indicators in a way in which past regimes perhaps have not and which, therefore, will be responsive to local circumstances. Nevertheless, they will press on local authorities the need to achieve best value in all their endeavours. The way in which the Audit Commission develops its regime should help local authorities to develop their own internal targets and indicators of their performance.

Therefore, I hope this is the basis of a constructive relationship between the Audit Commission, the local authorities and National Health Service bodies.

On Question, Motion agreed to.

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