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In that vein, the noble Lord, Lord Steel, and others asked about the view of my right honourable friend David Cameron, the leader of the Conservative Party. It was put that he has decided that House of Lords reform should not be his primary priority. There were questions about why that should be. The answer is very simple. What are his priorities? He is preoccupied by the plight of families who face losing their jobs and having their homes repossessed, by being the Prime Minister of a nation that is collapsing in near bankruptcy, and by a financial crisis, caused by failed regulations and muddled monetary policy, that has led to an asset price boom and now a credit bust. He wants to face up to the problems of a broken society and an education system in which 20 per cent of children leave school without getting even a C grade at GCSE. At the end of that we may well turn our minds to parliamentary reform. I must confirm to this House that our fundamental views on reform have not changed. I want to see this great old House playing a larger, not a lesser, place in

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our Parliament. In my opinion and that of my right honourable friend Mr Cameron, that can come only by allowing the public to elect political Members of this Chamber.

I opposed Mr Blair’s plan to entrench an all-appointed Chamber in 1999. I seem to recall large numbers of those who are present today with me in the Division Lobbies. The late Lord Weatherill’s amendment won overwhelming majorities in both Houses, including many noble Lords who now back the noble Lord, Lord Steel, in removing elected hereditary Peers’ by-elections without securing any commitment to future reform. I opposed the Bill in 1999 because it was incremental. We would have saved ourselves a great deal of bother if we had done the fundamental reform then, as well as a great deal of time on these endless debates. I recall the dignity with which hundreds of former Members of the House left in 1999 without a murmur in the expectation that this House would keep its word that stage 2 reform would come. Many of those who voted on that day believe we should keep our word. I believe that Part 2 breaks that word and I therefore cannot support it.

I was flabbergasted by the noble Lord, Lord Howarth of Newport, who claims his seat here by betraying his party and his electors, and somehow regards himself as superior to my noble friend Lord Caithness who was elected by his Peers and is here by virtue of statute.

The noble Lord, Lord Grocott, asked about stage 2. Perhaps I may say that the noble Lord, Lord Grocott, spent far too much time as Chief Whip on the Front Bench. He always speaks with tremendous eloquence and, in the main, very good sense. His question on stage 2 was answered very effectively by the noble Lord, Lord Tyler. The noble and learned Lord, Lord Irvine of Lairg, has rightly said that stage 2 need not be an appointed House, an elected House or a hybrid House. But stage 2 has to be satisfactory to both Houses and take the views and interests of both Houses into account. If it does not do that, it cannot deliver the stability that many noble Lords seem to hope and think this Bill will.

It is also easy for Liberal Democrats, such as the noble Lord, Lord Steel, to ignore the political disadvantage that would disproportionately affect Conservatives and Cross-Benchers if Part 2 should come into effect. Indeed, my noble friend Lord Caithness explained with great care what has happened since 1999.

Notwithstanding the observations of the noble Baroness, Lady Finlay of Llandaff, Conservative Peers are on average much older than most Members of this House. Actuarially, they are, sadly, likely to die faster. Under the terms of this Bill, it is very hard to work out whether every time a Conservative Peer dies, one of Labour’s Peers will have to go too in order to maintain the proportions. That, of course, could leave the Liberal Democrats sitting pretty. That is the problem of any mechanistic scheme of numbers. It will always hurt the party whose membership is older, more infirm and less able to attend. If decisions on composition are to be made on the slide-rule suggested by the noble Lord, Lord Jay, on the basis of numbers alone, that would ignore a major reality of our House which has affected

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both governing parties, Labour and Conservative, in their time; namely, that of age, as recognised by the noble Lord, Lord McNally. Someone talked about a geriatric House, which is a problem. In fact, a paradox of the 1999 Act is that the average age of the House rose by five years after that Act was passed.

I notice that the noble Lord, Lord Steel, does not propose a retirement age. The noble Lord, Lord McNally, is in favour of it. But the noble Lords, Lord Goodhart and Lord Cobbold, suggest that there should be terms of appointment—either 15 years in line with the royal commission or 20 years as suggested by the noble Lord, Lord Cobbold. Perhaps we should have a debate about retirement age. What are our views on that? Should it be 80, 75 or 70 years-old? I have to warn the House that if the retirement age was 70, the noble Lord, Lord Steel, would not be with us today.

Some want this Bill because they think that it is the piece of paper that will bring about an appointed House and will solve the House of Lords question in our time. Others genuinely see it in incremental improvements that they think will help the House. As I said on a previous occasion, the Bill provides architecture towards an alternative solution: an all-appointed House. I pay the noble Lord the compliment of saying that he and his expert advisers have at least changed the Bill marginally since last year, but his changes do not address some of the fundamental problems that we will have to consider in Committee.

Some of these questions I posed to him 12 months ago. For instance, in Clause 8(2), how does one define party affiliation? How would one treat those noble Lords who go to the Cross Benches while they hold quango appointments but still vote the party line? In working for party balance, on what basis does the commission decide how many seats each Opposition party will get? Are election results taken into account, or are the votes cast, or number of seats in the House of Commons, or what? What is meant by a public appearance or public speaking in support of a political party in Clause 8(4)(b)? For instance, if the Conservative Party were to organise a rally against the Heathrow third runway or against ID cards, and a distinguished environmentalist or civil libertarian came and spoke, would that mean he would then get the black spot under the Bill? How will it work? I am sure that is not the intention of the noble Lord, Lord Steel, but it could be one of the effects.

What is meant in the Clause 9(2) about making procedures for the various parties’ nominations for peerages consistent? The noble Lord, Lord Lea of Crondall, spoke rather well on this point. Our systems are rather different from the Liberal Democrats, who hold elections, inevitably, by the most complex PR system known to man. I have here the results of their last election to the so-called interim Peers panel. You could not make this up. There were 44 breathless candidates and there was a grand total of 1,188 electors. I gather that 21.32 votes were transferred away from the unfortunate Mr Mohammed Shafiq and therefore he was excluded in the last round, which was number 31. Why on earth should the other parties be consistent

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with this nonsense? Why should we adopt a lunatic system with 1,188 electors when there is a tried and tested one with 40 million?

There is much else in the Bill that we need to probe. I shall not say a great deal about leave of absence for disciplinary matters. There is a mood in the House that something needs to be done but we need to wait for the reports of the sub-committee and the Privileges Committee before we move forward on that.

Clause 12(1) on the so-called failure to attend is an interesting way of dealing with the issue of Peers who do not attend. I do not know who the noble Lord, Lord Steel, had in mind—the proposal is to exclude a Peer who does not turn up in one Session—and so I have done a little research. I have discovered that in the 2006-07 Session, the last Session for which figures are available, there was a Peer who did not attend for a single sitting day. Who was that? None other than the noble Lord, Lord Stevenson of Coddenham. He would then, perversely, be sent out to find a Peer to replace him, who would then be obliged to come. Another perverse effect is that it would encourage Peers to come in who would be better staying away. It does not deal with the problem of long-term illness or Peers who go and run Bosnia or work in the European Union and so on, but these are detail points.

On the issue of permanent absence, Clause 11(3) leaves unspoken the question of whether there should be inducements to leave. It raises the issue of bonuses for departure, very much like Sir Fred Goodwin of the Royal Bank of Scotland. It is rather odd that we set ourselves up as being here for life, there is an expectation of being here for life, and yet we want to have in the Bill a reason for leaving. I am not quite sure how that will be explained.

On the size of the House, there is a complete tension between Clause 8(2) and Clause 8(6). Clause 8(2) sets out how the numbers are calculated. Before the Labour Party gets enraged, perhaps I may put forward the small proposal that the Conservative Party will win the next General Election and then look at the figures. Automatically, with the current composition of the House, the Conservative Party would be entitled to an extra 42 Members. The House would then increase to 732, and that is without any dissolution honours, retirement honours or any other honours—yet, under Clause 8(2), the House has to be reduced to below 646. There is no system now for doing that, and we should discuss how to do it. There are proposals that in every Parliament the House should be reduced by 10 per cent. We could do that by election; we have done it before, and there is no reason why we should not do it again.

I have one final question: what does “normally” mean in Clause 4(2) when it says that the commission would normally consider nominations from leaders of parties with six seats in the House of Commons? If, God forbid, the British National Party won six seats in a general election—under PR, for instance—would the commission say, “Sorry chaps; we would normally, but not for you”? If we look at the present House of Commons, does a letter to the noble Lord, Lord Jay, from the SNP, which has seven members, get opened

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while one from Plaid Cymru, which has three, gets sent back? In Northern Ireland, would the Democratic Unionists, with nine seats, get the red carpet treatment while Sinn Fein, with five, and the Ulster Unionists got nothing? If not, again, on what basis does an unelected commission decide what part of the people’s voice can be heard and what part can be ignored?

The noble Lord, Lord Grocott, said, and this was echoed by many others, that this is not a comprehensive Bill and that it does not try to answer all the difficulties. Clearly it does not, but I detect in the House—this is the difficulty for the Minister—that there is impatience and a head of steam; great pressure is building up on all this. I shall voice one small warning, which I know will be ignored: supporters of the Bill may find that when it gets to another place Members there will be equally yearning for it, but they will have very different views on how an appointments committee should operate and may send back a very different Bill from the one that its supporters imagine. When we debated these issues with Mr Straw some time ago, it was clear that there was a substantial view that a statutory appointments commission should include provisions for decisions based on regionalism, gender, ethnicity, age, retirement, terms of office and all the complexities of religious representation that the noble Lord, Lord Kerr, discussed, as well as many other things.

I welcome the Bill going into Committee. It will need a great deal of discussion and possibly revision. If it goes to Committee, I will join noble Lords in playing my full part in the subsequent debate.

1.47 pm

The Minister of State, Department of Energy and Climate Change & Department for Environment, Food and Rural Affairs (Lord Hunt of Kings Heath): My Lords, I, too, congratulate the noble Lord, Lord Steel, on his patience and determination, which have allowed us to have such an excellent debate today. He sees me as a bad penny, but so long as he presents Bills to us on reform of your Lordships’ House I will continue to roll down to this Chamber—at least, if I pass the medical tests that the noble Baroness, Lady Finlay, threatens to apply to noble Lords in this desperate effort to reduce numbers below what is considered to be desirable.

We have had an excellent debate, both on the detail of the Bill—there are many complex details that need to be discussed and debated—and on the wider debate on Lords reform in the context of the Government’s White Paper that was published last July. I say to the noble Lords, Lord Low and Lord Strathclyde, that I would welcome a debate on that White Paper and an opportunity to respond to some of the less than complimentary remarks that have been made about it. I see my noble friend the Leader of the House is on the Bench beside me; we look to the usual channels, as ever, to provide the time.

I welcome this opportunity to debate some of the major principles of Lords reform, and I reiterate that it is the Government’s intention to see through substantial reform of your Lordships’ House and to put our case to the electorate at the next election. We want to make it clear that we are indeed committed to substantial reform.

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Some noble Lords have asked me today to indicate the Government’s support for the measures in the Bill of the noble Lord, Lord Steel. I have listened very carefully to the points and questions raised. By tradition, the Government do not oppose Private Members’ Bills in your Lordships' House, and this Bill should certainly be no exception to that rule. By tradition, the Government offer constructive comments on the technical drafting of the Bill before your Lordships' House; again, this Bill should not be an exception to that rule. Many noble Lords have noted the similarity between this Bill’s proposals and some of the proposals in the Government’s White Paper published last year. That document also proposed a statutory Appointments Commission and an end to hereditary by-elections. This Bill and the White Paper would both give Members the ability to resign and both propose disqualification for not attending this House, as well as disqualification for a serious criminal conviction.

I was of course very much interested in the comments of the noble Lord, Lord Jay, on the proposal for a statutory Appointments Commission. If an element of appointed Members is to continue in the long term, we would certainly support a commission with a politically balanced membership serving non-renewable terms and making recommendations to the Sovereign through the Prime Minister. We would certainly support appointments based on identifying candidates willing and able to contribute to the work of this House. However, as has been pointed out by a number of speakers in our debate, some of the questions of detail that are contained in the noble Lord’s Bill still stand to be answered. For example, in Clause 9, the commission is given a degree of power to require information from party leaders, but how would that power be defined or limited? What information might be withheld? Or, again, how would the party balance described in the Bill be safeguarded in the case of a number of independent Members taking a party Whip? Would there be sanctions if independent Members chose to do so? I am happy to see that the noble Lord’s Bill now requires the commission to look into the consistency of the way in which political parties make nominations to the commission, which would certainly provide for a clearer baseline from which the commission could start its scrutiny of candidates, but it does not say with what there must be consistency, and that will need to be answered.

The commission would be given the final say over the exact proportion of political parties, and some questions remain to be answered there: what would determine the speed at which the commission phased in new Peers to reflect a change of Government? What would determine the level, within the 0 per cent to 3 per cent boundary contained in the Bill, of the majority of a Government? We know that the commission may phase in recommendations for numbers of new peerages with regard to achieving the prescribed political balance in the House over two full parliamentary Sessions following a general election. It would then have two Parliaments or eight years to achieve a total membership not exceeding that of the House of Commons, but, as the noble Lord, Lord Strathclyde, asked, what happens if the aim to achieve political balance conflicts with the need to limit the number of

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Members? If there were a frequent change of Government, and those changes occurred regularly—we could look back perhaps to the 1960s or other periods where that might have happened—how would the tension between the two aims be dealt with?

I suggested in our previous debate on the noble Lord’s previous Bill that it might be advisable when it comes to Clause 5(5) and Clause 6(2) to include the affirmative, rather than the negative, resolution procedure where the Appointments Commission proposes additional criteria on which to assess candidates, and he has not so far moved on that matter. So those are some of the rather technical details which have to be addressed if this Bill is to proceed further in your Lordships' House.

Let me raise a number of other points. There may be a lack of flexibility in the system if the Prime Minister is obliged to pass on all recommendations to the sovereign. What would happen if the Prime Minister had information about an individual that the commission could not be expected to have—for example, if it concerned issues to do with national security? To require the Speaker and the Lord Speaker to nominate the commissioners gives two people a large amount of decision-making power, in an indirect way, over who sits in our legislature. What happens if they disagree? Would there be any review or appeal mechanisms in place for Speaker or Lord Speaker nominations?

Last time we debated this Bill, many Members reflected on what “conspicuous merit” might mean. Would having to be conspicuous or to stand out in some way exclude some candidates who would make excellent contributions? I mentioned the practising members of the nursing, teaching and social care professions whose work may not be conspicuous in the dictionary definition of the word, but whose experience may be no less valuable to this Chamber.

On expulsion, the Government have always been clear that Members of a reformed second Chamber should be held to account if they do not attend regularly. That is why the 2008 White Paper proposed that provisions similar to that of the Local Government Act 1972 should apply to members of a reformed second Chamber. Under the proposal, Members who do not attend for any period of six months will be disqualified, unless their reason for non-attendance had been approved by a committee of the second Chamber within a defined period. We welcome the opportunity to debate views on the noble Lord’s proposal where the trigger for disqualification is one parliamentary Session rather than a six-month period. But I would raise one point with the noble Lord concerning those Members of your Lordships' House undertaking important work outside the House such as in the UN, the EU or NATO. I know that there is provision in the Bill for such noble Lords to apply and to be considered for dispensation. But considering the kind of post that they would be undertaking, I ask why they should be asked to plead their cause.

It has been a great delight to hear and respond to my noble friend Lady Jay. It was she who did so much to take through the 1999 Act. It is worth noting, and she will perhaps recall, that at the time it was said that the proposals would lead to the utter decimation and

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destruction of the quality of your Lordships' House. It is interesting that many noble Lords who have remarked on the House as it has been since 1999 have mentioned its improved quality. I pay tribute to my noble friend. She referred to taxation and membership of your Lordships' House. She will know that on other Fridays there will be debates on the Bill of the noble Lord, Lord Oakeshott. The Government are in favour, in principle, of dealing with these matters and I look forward to debating the details of that in further stages of that Bill.

In his characteristic way, the noble Lord, Lord Lucas, got it right about the role of the remaining hereditary Peers. The Bill would end the by-election system, although I think that the heading of Clause 10, “Exclusion of hereditary peers”, is rather overegging the system. It is a trifle optimistic, as it could be at least 50 years before the last hereditary Peer left.

We come to the question of stage 2. There is of course no definition of stage 2, but it would be fair to say that it has always been taken to mean substantial reform.

My noble friend Lord Lipsey suggested the Government’s stance on Lords reform and the Bill proposed by the noble Lord, Lord Steel, was either cynical or immoral. I must refute that. Our position on what is both necessary and sufficient to reform your Lordships' House is well known, and I have already said that we are committed to comprehensive reform. We believe in basing our proposals on the meetings of the cross-party group, on the votes in the House of Commons, which showed clear majorities for an elected second Chamber, and after publication of our White Paper. Of course, we will reflect on responses received during the period of consultation, and on the views of noble Lords in this House.

I listened with great interest to a number of comments made by noble Lords on the White Paper. My noble friend Lord Faulkner and the noble Lord, Lord Higgins, were less than complimentary; my noble friend Lord Grocott thought that 150 responses implied that there was not great support out there for reform of your Lordships' House. I would suggest that there are two ways of looking at that: it could well be that the proposals were so sensible that people were not inclined to comment. However imperfect noble Lords may consider the White Paper, it was produced from a great deal of discussion cross-party, with the helpful presence of the noble Baroness, Lady D’Souza, and the right reverend Prelate, and is as close to consensus as there has been for many a year in outlining the future of your Lordships' House.

Of course, I agree with the noble and learned Lord, Lord Howe, that this House does excellent work. It does indeed, but it is a House of Parliament. This Government and the House of Commons through its votes considered it unacceptable for a House of Parliament not to be wholly or mostly elected. I know that my noble friend Lord Gilbert does not entirely agree with that view; he does not agree with that at all, and it was very good to see him intervene in our debate today. The fact is that democracy in the end is the ability of people in our country to vote for the people who will make decisions on their behalf.

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Lord Howe of Aberavon: My Lords, I apologise for intervening at this stage of the Minister’s speech. Nobody questions the value, the power or the significance of democracy, but the three questions that I posed in my speech must still be answered by any advocate. If we have a structure whereby we enjoy the benefits of the eccentricity, if you like, of this House alongside the benefits of democracy and, in the last resort, subordinate to democracy, can we not go on enjoying the best of both worlds, which is what delivers us the best that we have today?

Lord Hunt of Kings Heath: My Lords, surely that is what the proposals in the White Paper are about. They are about building on the undoubted strength of your Lordships’ House, but with the benefit of Members being either wholly or mostly elected through the ballot box. That is what the White Paper attempts to achieve.

I say to my noble friend Lord Grocott, who is a very wise politician, that of course an elected second Chamber would be more assertive. In the deliberations on the White Paper, we spent many hours discussing the whole issue of primacy and how to maintain it, looking at the conventions. We devoted a great deal of attention to these matters. Primacy will be assured through the Parliament Acts, the financial privilege of the Commons, the fact that the Government maintain their position through the confidence of the Commons, the fact that the Prime Minister and most Ministers are drawn from the Commons and the fact that, under the proposed system, the second Chamber would never have a more recent mandate than the House of Commons. But, yes, the House would be more assertive. In view of the comments that many noble Lords have made about establishing Parliament in a stronger position with the Executive, surely that is an extremely desirable aim.

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