My noble friend Lord Bach made a powerful case. He speculated on why the Government have reneged on their commitment. The only answer that we have received is that the Government say that it is not feasible. I wonder why not. Today, the Minister has argued that it is because of administrative costs, but in my book, administrative costs and feasibility are not the same thing.

Citizens Advice has proposed a number of options to make a reality of the Government’s commitments and made representations on them to the Government. Are those options among those which the Government have reviewed—the Minister referred to a review in passing? Were they considered not to be feasible? If so, why not? Was the suggestion made by the noble Lord, Lord Pannick, considered not to be feasible? If so, why not? Unfeasibility is a vague response. Citizens Advice referred to the Government’s proposal as “irrational”. It criticises the fact that there has been no consultation on it. Can the Minister explain why has there been no consultation?

I finish by referring to an e-mail that I received this morning from a member of the public. She does not stand to be affected by the measures. She calls herself an ordinary woman, “nothing special”, but she is motivated by concern for her fellow citizens—in particular those who are sick or disabled. She refers to the fear that many such people now feel. She writes:

“I am pleading with you … to be fair and just when you ‘discuss’”,

the regulations. She finishes:

“I have never felt so strongly about anything before so forgive me if I am departing from normal protocol. All I know and believe is that this is wrong and it needs to be stopped”.

How right she is.

5.45 pm

Lord Woolf: My Lords, I been trying to limber up, and I hope that I am now able to follow what has been said by my noble friend Lord Pannick and my noble and learned friend Lord Mackay of Clashfern. I agree with every word that they said with regard to the amendment to the Civil Legal Aid (Merits Criteria) Regulations, which are the subject of the regret Motion.

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In order to understand the context, it is necessary to know that judicial review is, of course, subject to principles which have been judge-made. Judicial review, in the form that it is now, is a judicial invention of which we are extremely proud. We are proud of it because the object of the exercise is to ensure, in particular in relation to public law proceedings, that the appropriate procedure is adopted, having regard to the issues raised.

At one time, it was thought—again, by decision of the House of Lords in the well known case of O’Reilly v Mackman, that it was always necessary to use judicial review in public law proceedings. It was then found in practice that that led to satellite litigation over whether the right procedure had been used or the wrong procedure. The courts sought to produce watertight compartments. Fortunately, that was only a temporary stage in the development of judicial review. The next step was to adopt a much more sensible and realistic approach, which involved proceedings being dealt with in the most sensible and reasonable way. Although the phrase that judicial review should be used only where there was no alternative remedy was retained as a simple method to identify one of the principles, the law had developed beyond that. It was made clear by authority after authority that that was subject to the requirement that it should always be reasonable to adopt the procedure which was proposed: judicial review.

Regulation 53(b) contains the statement that is in accord with the general principle of exhausting alternative procedures, but does not refer to the fact that that is not a rigid limitation, but reflects the nature of the procedure, which requires the court to adopt a reasonable course in considering the matter. As has been pointed out by both my noble and learned friend, Lord Mackay, and my noble friend Lord Pannick, that approach of the courts is almost impossible to adopt as a matter of interpretation because of the language of Regulation 39(d). An additional reason to those which have been given for accepting my noble friend Lord Pannick’s Motion and amending Regulation 53(b) is that if that is not done, the procedures in the courts and the procedure for granting legal aid will be out of sync; they will be in conflict. That cannot be a sensible position. Litigants will be forced not to do the reasonable thing, which is what the Civil Procedure Rules require, because they will not have legal aid if they do that, but to adopt an unreasonable course and bring proceedings by judicial review and then get legal aid. That cannot be a sensible course.

I hope the Minister, having heard the argument before the House, will accept the invitation which has been made to consider the matter again. I would be very happy to adopt the amendment suggested by the noble and learned Lord, Lord Mackay, but would, perhaps, suggest that if it is thought preferable to amend Regulation 53(b), what was intended, I believe—or what, at any rate, it should state—could be achieved by inserting into paragraph (b), “the individual exhausted all administrative appeals and other alternative procedures which it would be reasonable for him to adopt to challenge the act, omission or other matter before bringing a public law claim”.

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I should have said that my noble and learned friend Lady Butler-Sloss intended to speak and asked me to indicate that she supports the arguments advanced by the noble Lord, Lord Pannick, and those which I have just advanced.

Lord Goldsmith: I want briefly to support both amendments. So far as the amendment moved by the noble Lord, Lord Pannick, is concerned, it is not necessary to say very much after a former Lord Chancellor and a former Lord Chief Justice have both criticised the order as it stands because of the way it operates in different ways. I can summarise my view in relation to it very briefly. This order already recognises that there may be “reasonable” and “not reasonable” alternative procedures. It does that in Regulation 39. However, if one then reads Regulation 53(b), it is very clear that the word “all” must be read as meaning “all”. Therefore, if one expands the meaning, what is being said as it stands is that there will not be legal aid unless the individual has exhausted all reasonable and unreasonable alternative procedures. As soon as one poses the question that way, it becomes absolutely plain that it must be wrong to impose that obligation. I do not think it is necessary to say anything more than that to summarise why the noble Lord, Lord Pannick, and the noble and learned Lords, Lord Mackay of Clashfern and Lord Woolf, are absolutely right.

Let me turn to my reasons for supporting my noble friend Lord Bach in his amendment. I recall very well the clear and powerful way in which the noble Baroness, Lady Doocey, moved the amendments which led to this particular issue. They were strong and supported by a majority of this House. I have read the debate—though I did not listen, as my noble friend Lord Bach did, to the debate itself—which took place in the other place. It seems clear to me that what was being said was that a way would be found to enable legal aid to be provided in the first tier where there were points of law. The concern expressed by the Government was that they did not want that to be a point of law just because it was so stated by the claimant or the claimant’s lawyer. That is clear in column 266. However, the Government have not ended up with that at all. They have ended up with something which appears—if my understanding of the way the procedure works is right, and it follows that of my noble friend Lord Bach—to mean that legal aid does not come into the picture until after the event. That may be appropriate in certain other circumstances, but not here.

What one needs in these circumstances is the ability to identify a point of law which will be relevant and necessary for a particular applicant—particularly a claimant of the sort to which the noble Baroness, Lady Doocey, referred—to be able to put that point of law before the tribunal. I fully endorse her point that most claimants do not recognise a point of law when they see it. I suppose that as a practising and paid lawyer, I am quite pleased, on the whole, that that is the case, although I do not actually practise in this area. The point is this, however, and I ask the Minister to answer this question: why could the way the Government limit this not be by the chairman of the tribunal identifying the point and certifying it at the outset rather than waiting until after the event?

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There is one point which connects these two amendments, and it is what drives me to want to persuade the House to support them. In LASPO, we were faced with changes which, for many of us, were very difficult to accept. The Government put them forward on the basis of economic necessity. However, there was a strong belief that there were cases where justice required that there should still be some opportunity for legal advice to be taken and used. In these particular cases—public law and cases involving claimants with disabilities, for example—the Government are failing to give effect even to that limited, modest exception that they were prepared to allow. I very much hope that the Government will think again in the light of this debate.

Lord Phillips of Sudbury: In the light of what I am going on to say to my noble friend Lord McNally, I would first like to say that the whole House well understands the exigency that led to the LASPO Bill. However, as my noble friend Lady Doocey forcefully pointed out, and it cannot be repeated enough, in the realm of social welfare law, there is a singular obligation on us as parliamentarians to will the means of accessing those benefits. Unless we do that, everything that Parliament does is a charade or a sham; because it is cynical on our part not to give the people most in need in our blessed country—the poor, those lacking in self-confidence, those without a scintilla of understanding of the law and those who can scarcely read a Bill and understand it—the real opportunity to access the benefits we are proud to bestow on them. It puts this realm of public expenditure into a special bracket. There are very few areas of expenditure, I suggest, that really come within that narrow purview.

It was interesting to hear the noble and learned Lord, Lord Goldsmith, talking about lawyers looking forward to these rather nuggety issues in social welfare—it was a joke of course—but the reality is that no lawyer goes into the realm of social welfare law to line his or her pockets. I can tell the House that only the most socially minded lawyers subject themselves to practising in this field.

I hope my noble friend Lord McNally will accept my next point. In all the fields of law, there is nowhere more complex than the forest of social welfare legislation. It runs to hundreds and thousands of pages. It is utterly futile to pretend that the ordinary bloke can begin to put together the grounds for going to the director to ask for support to launch an appeal if he or she has got to understand the legal background and legal prospects, because that is way beyond the capacity of all but a very small number.

My final point is this. When the noble and learned Lord, Lord Mackay of Clashfern, was five minutes into his speech, I wondered whether he had, by mistake, picked up my notes. Every single word he said about the clash between Regulations 39(d) and 53(b) was absolutely the same as what I was going to say. The only thing I would add to it—and this is addressed to my noble friend Lord McNally—is that, as the noble and learned Lord, Lord Mackay, made clear, Regulation 39(d) is expressly imported into Regulation 53, but the language in Regulation 39(d) and Regulation 53(b) is not consistent.

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That raises further problems. If things proceed as they are, for example, it is unclear what is meant by the word “unavailable” in Regulation 53(b). It is also not apparent to me how to construe the words in Regulation 53(a),

“appears to be susceptible to challenge”,

with the word in the following subsection (b), “procedures”, which are available to challenge. The refinements in the language and, I believe, the confusion are such as to render this part of the regulations not fit for purpose. I very much hope that my noble friend will be able to give the House an assurance at the end of this debate that there will be amendments to the regulations hot on the heels of the passage of the same.

6 pm

Lord Beecham: My noble friend is to be congratulated not only on bringing this amendment to the House but also on being elected Peer of the Year. At this rate he may turn into the Hilary Mantel of your Lordships’ House; she of course has won her second Man Booker prize, and it may be that next year my noble friend is awarded with his accolade again. I will speak briefly to his amendment before turning to that of the noble Lord, Lord Pannick.

The Opposition entirely support the case made by my noble friend, particularly because, embedded in the Government’s approach and reflected to some degree in today’s debate, there is some confusion between points of law and errors of law for the purpose of these regulations. The Citizens Advice briefing helpfully makes this distinction clear. It says:

“Furthermore in devising this whole policy Government appears to be confusing ‘points of law’ with ‘errors of law’. Whilst the majority of first tier welfare benefit appeals turn on ‘points of fact’ such as financial and other circumstances … many cases do raise significant legal issues over statutory interpretation (ie social security regulations), legal tests for disability”—

as referred to by the noble Baroness, Lady Doocey—

“or disputed application of … precedents etc. The tribunal making an error of law which may be subject to a right of appeal is a much narrower concept”.

We have to bear that distinction in mind when weighing the strength of the case made by my noble friend. It will be the very exceptional case, as the noble Baroness pointed out, that may qualify for that description of an error in law, which of course has to be self-certified by the tribunal itself—a peculiar process, one might think. We are certainly not in the position that the Minister mentioned in the debate in the House of Commons when he talked about 440,000 cases. That number is inconceivably large and, in my view, can be dismissed. Certainly, though, probably a good deal more than 650 cases could potentially arise if the definition were to deal with points of law. I hope that, bearing in mind the assurances given on the earlier occasion by the former Lord Chancellor, the House will support my noble friend’s amendment.

I also support the amendment moved by the noble Lord, Lord Pannick, and supported by the noble and learned Lord, Lord Mackay, as I understand him. Indeed, there is a peculiar relationship between Regulation 53 and Regulation 39, but in my view it

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goes somewhat beyond the matter identified by the noble and learned Lord. In addition to the potential clash with Regulation 39(d), it strikes me that problems arise in relation to two earlier parts of that regulation, paragraphs (a) and (b). I remind noble Lords that all these matters have to be borne in mind when dealing with Regulation 53. Under Regulation 39(a) the director has to be,

“satisfied that the following criteria are met … the individual does not have access to other potential sources of funding (other than a conditional fee agreement) from which it would be reasonable to fund the case”.

That is a fairly open-ended requirement. Regulation 39(b) says that the director has to be satisfied that,

“the case is unsuitable for a conditional fee agreement”.

Suppose, though, that it was suitable for a conditional fee agreement; that of course does not necessarily mean that a conditional fee agreement is available. Suitability and availability are not the same thing. That reinforces the noble and learned Lord’s point that there is an inconsistency between Regulation 39 taken as a whole, not just in relation to Regulation 39(d), and Regulation 53. I hope that noble Lords will be convinced by that element.

There is a further matter that I need to touch on. The thrust of the Government’s proposals is to reduce the reliance on judicial review. We have to be concerned about this in view of recent pronouncements about the Government’s desire to reduce substantially the number of cases that can be advanced by that method, which is of course a principal method of holding the Executive to account. This is just one potential example, but I think that noble Lords will want to pay particular attention to it, having regard to the category of people who will be most affected by it. We should not lose sight of the fact that this may be part of a process of restricting access to judicial review that will go well beyond this particular category. In my submission, that is an additional reason for noble Lords to support the amendment moved by the noble Lord, Lord Pannick.

Lord Mackay of Clashfern: My Lords, am I right or wrong in thinking that any appellant who is unhappy with the decision of the First-tier Tribunal can ask it to review the decision?

Lord Beecham: Assuming that the appellant has the knowledge of that procedure, he might ask it to review its decision, but the review will amount to nothing unless the tribunal convicts itself, as it were, of an error in law. If it makes that mea culpa then under the Government’s amendment there is a potential for legal aid to be granted, but not otherwise.

Lord Elystan-Morgan: My Lords, I support both amendments. I am sure that it is not necessary for me to add my voice to the very distinguished contributions that have already been made in this regard. Both amendments turn upon undertakings that have been solemnly given—and, no doubt, in the best faith—by the right honourable Kenneth Clarke. I accept that completely. If there has been mischief, it has probably been the mischief of mandarins thereafter in trying to release him in some way from an undertaking that he solemnly and sincerely gave.

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The other feature that is common to both amendments is that they deal with situations where preliminary machinery is set up before a person can qualify for legal aid. In both cases, in my view, that machinery imposes such a burden upon the potential applicant to make his or her case virtually impossible—in other words, a total denial of what otherwise would be a fair and just application by that person.

In the circumstances, bearing in mind the weight of authority that has been projected towards the Government in this case, it would be a very rash Minister who did not concede the obvious points made in the amendment moved by the noble Lord, Lord Pannick. If the noble and learned Lord, Lord Mackay, is correct about the interaction of Regulations 39 and 53, and if it be that Regulation 53 in this regard is totally and absolutely governed by the relevant provision in Regulation 39, then that is it—the Government do not lose one millimetre advantage, because that situation has already been covered and fully determined. However, if that is not the case, then it seems that the argument put so powerfully by the noble and learned Lord, Lord Goldsmith, must have come into play. That is that the director could come to the conclusion that indeed all reasonable avenues had been pursued but that there were unreasonable avenues that had not been pursued. That would be an absurdity and a miscarriage of justice. It is either one or the other.

As far as the amendment of the noble Lord, Lord Bach, is concerned, it seems to me that there again is an irrefutable case. I am not at all clear what triggers the situation where there would be a review by the first tribunal. Would it be something entirely within the discretion of that tribunal, or would it be on application? If it is within the discretion of the tribunal, it is a very strange situation that a tribunal is invited to consider whether it is in error.

Of course, I draw the distinction that has already been pointed out by the noble Lord, Lord Beecham. There is a world of difference between a point of law and an error of law. When a judge has adjudicated in a civil case and is invited to grant leave to appeal, he is not saying, “I am wrong”, or, “I am sure that I am wrong, please appeal”. What he is saying is that there is a point of law that is properly arguable. That is a very different situation from a tribunal which says, “We are wrong”. In fact, I do not know of any other circumstance where such machinery exists in law, but I am sure I will be corrected with regard to that.

The basic principle that we are concerned with here is that legal advice on a point of law should belong to the beginning of an action, not to the end of it. So much anguish will be saved by a very modest expenditure. I believe that so much money from the public purse will be saved because there are undoubtedly downstream costs which will be massive in scale in relation to this. However, above all it is a question of miscarriage of justice.

We think of miscarriage of justice as a situation where a tribunal has come to an utterly wrong decision. It is not limited to that at all. A miscarriage of justice occurs where a person has a just, meritorious case, and on account of lack of money is unable to have that case properly adjudicated. If you ask any decent citizen

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of this land, whatever politics or total lack of politics he or she may have, “Do you believe in a miscarriage of justice?”, we all know what the answer would be.

Lord Marks of Henley-on-Thames: My Lords—

Noble Lords: Minister!

Lord McNally: I have never been so popular.

A noble Lord: It won’t last.

Lord McNally: I heard that as well. I am very grateful for the contributions to this debate and not least for all the free legal advice I have been given. It has been a useful debate and I have listened very carefully to the points made. A number of noble, and indeed noble and learned, Lords have raised the issue of judicial review. The difference is in approach between Regulations 53(b) and 39(d).

As I said earlier, the Government believe that the current drafting of Regulation 53(b) meets the concerns raised both here and in another place. However, having listened to the arguments that have been put forward today, I recognise the strength of feeling that the regulation has provoked. I make it clear at the outset that it has never been our intention to cut off legal aid for all judicial reviews. The noble Lord, Lord Beecham, was just setting a hare running about other plans for judicial review. In our view, this provision has been misunderstood.

That said, I have heard the anxieties that have been forcefully expressed about this provision. In the light of that, I believe we should put the situation beyond doubt by setting it out in the regulation. Therefore, having listened carefully and having consulted with colleagues, I can tell the House that, once these regulations are made, the Government will bring forward as soon as practicable, and in any event well before April 2013, amending regulations to revise Regulation 53(b). These regulations will introduce discretion into Regulation 53(b) so that the director of legal aid casework will have the express power to grant legal aid for public law claims, even if the alternative routes have not been exhausted, if he none the less considers that such an appeal or procedure would not be effective in providing the remedy that the individual requires. This would clearly address the situations that are causing noble Lords concern. It would, for example, put beyond doubt that legal aid for judicial review would be available where the claimant required urgent interim relief and this could not be provided in any other way.

I hope this will meet the concerns of the noble Lord, Lord Pannick, my noble and learned friend Lord Mackay of Clashfern, and others. Indeed, we will have the time to consult noble Lords about the wording of the amending order that I will bring forward in the new year. I hope that in the light of that the noble Lord will not press his regret Motion.

6.15 pm

Lord Reid of Cardowan: My Lords, for those of us who have experienced neither legal training nor legal practice but who have listened to the very articulate

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and understandable critique by many noble and learned friends, can the Minister answer this question for me? I very much welcome what he has said. Is it implicit in what he says that, whatever discretion is given, it will not only come into effect if the First-tier Tribunal decides that it has made an error in law? That was explicit in many of the critiques which have come out. Is that conditionality now removed?

Lord McNally: My Lords, I, too, am not a lawyer. I think that the noble Lord is asking what comes next, and that relates to the second order, not the first one, which the noble Lord, Lord Pannick, asked about. I will try to cover the point which he has raised when I get to that.

As I said, there was never any attempt on our part to change the rules as far as judicial review was concerned. However, when a former Lord Chancellor, a former Lord Chief Justice and a former Attorney General tell you that it needs clearing up, I think it is only wise to see whether it can be cleared up, and that is what we will do.

Moving on, I have explained in detail how we have listened to the concerns of this House—in particular, in extending legal aid in welfare areas. I have never hidden the fact that the LASPO Bill was a very difficult Bill involving some difficult choices. I can remember answering questions at this Dispatch Box two years ago, when we first launched the consultation. I said then that, if you have a system which is targeted to help the poorest and most disadvantaged in your society and you are forced to make cuts in that system, you are going to affect the poorest and most disadvantaged in your society. I have never hidden that fact.

The idea that LASPO was nothing other than a very difficult Bill is again before this House. Many of the arguments that have been deployed tonight were deployed during the passage of that Bill. However, I remind this House that the LASPO Bill is now an Act that went through both Houses of Parliament and carries with it financial implications that have to be considered when discussing any changes to it. There is no infinite pot of money available and we have to think very carefully about how taxpayer-funded money is spent. The Bill was therefore designed to ensure that public funding remains available for the most serious cases and for those who need it most. In making hard decisions and tough choices, we have listened to the concerns of some of the very same Peers who have spoken today, and we made changes during the passage of the LASPO Bill.

Not for the first time, the noble Lord, Lord Bach, claims that the Government have not listened. I take this opportunity to set the record straight. I remind the House of the Government’s original proposal following the consultation on Proposals for the Reform of Legal Aid in England and Wales. Our response to the consultation stated that,

“it remains the Government’s view that legal aid should be removed for welfare benefits cases, as proposed in the consultation. However, it will be retained for judicial review of welfare benefit decisions, and for claims about welfare benefits relating to a contravention of the Equality Act 2010 that are currently funded, as proposed in the consultation”.

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That was our starting point. Since then, we have moved considerably from that position in response to arguments deployed in both Houses. During ping-pong on the LASPO Bill, having listened carefully to the arguments, we agreed to make available legal aid for advice and assistance for welfare benefit appeals on a point of law in the Upper Tribunal, including for applications made to the Upper Tribunal for permission to appeal. In addition, we agreed to make legal aid available for advice, assistance and representation for welfare benefit onward appeals in the Court of Appeal and Supreme Court. The order before us today makes a further concession which is not insignificant.

It may be helpful if I illustrate how this will work. An individual will make an appeal to the First-tier Tribunal against an administrative decision of a public authority. If the appeal is unsuccessful, the claimant can request a statement of reasons for the decision. The appellant can then apply to the First-tier Tribunal for permission to appeal to the Upper Tribunal. At this point, the First-tier Tribunal must consider whether to review its own decision if it considers that it has erred in law, and legal aid for advice and assistance will now be available in relation to that review. If the tribunal decides not to review, the next step is for the First-tier Tribunal to decide whether to grant or refuse permission to appeal to the Upper Tribunal. Where the tribunal refuses permission to appeal, the appellant can then apply directly to the Upper Tribunal for permission to appeal. Again, legal aid will be available for an application for this stage of the process. If permission is granted by the Upper Tribunal, then legal aid is again available for the substantive appeal before the Upper Tribunal.

Therefore, it is wrong and misleading to suggest that we are not making legal aid available in respect of points of law. As I mentioned in my opening remarks, we considered this matter in great detail following the debates during the passage of the Bill. We have explored every possible option to find a workable solution. Our considered assessment is that other methods of independent verification would have proved unworkable. We did consider the CAB proposals but we felt that they would create unreasonable cost and administrative burden. The cost is important. We have never tried to hide the fact that part of the exercise was for legal aid to make a contribution to the cuts in the spending review for the Ministry of Justice, a department which spends money only on prisons, probation, court services and legal aid. The proposals would have placed burdens on the successor to the Legal Services Commission, the tribunal judiciary and the Department for Work and Pensions.

In the Government’s impact assessment we identified that, in 2009-10, we funded 135,000 instances of welfare benefits legal advice. If the judiciary had to consider up to 135,000 interlocutory applications for legal aid, the impact on the tribunal service would be severe, and it could lead to serious delays in the resolution of other cases. Similarly, if the Department for Work and Pensions or the successor to the Legal Services Commission had to consider that large number of cases before they could be funded, it would result in a significant extra administrative

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and cost burden. We do not believe it right to impose these additional burdens in the current economic climate.

We have therefore decided on the approach set out in the order. This would impose no additional burdens on the tribunal judiciary because it must already consider whether to conduct a review on receipt of an application for permission to appeal against a finding of the First-tier Tribunal. The tribunal can conduct a review only if it is satisfied that there has been an error of law in the First-tier Tribunal’s decision.

Baroness Mallalieu: If the position is, as we have heard during this debate, that the noble and learned Lord, Lord Mackay, a former Lord Chancellor, and my noble friend Lord Bach, a Queen’s Counsel, cannot agree on the interpretation of the wording of Article 3 of this order, is it not clear that people who have no legal qualification and are going to have to look at it to see whether they can obtain legal aid are going to be completely mystified? Whatever the merits or otherwise of the order which the Minister is addressing now, this is badly drafted, unclear and needs to be looked at again.

Lord McNally: I do not accept that. I accept that the lawyers may have glossed the patch a little, as the noble Lord, Lord Reid, acknowledged. We are discussing various complex matters of its operation. I go back to the point that our initial intention was to take welfare out of legal aid—something that the noble Lord, Lord Bach, has opposed from the very beginning; I understand and appreciate that. That does not take away the fact that we have argued our case through both Houses of Parliament and put an Act on to the statute book. This is about implementing that Act.

It is clear that the Government have listened. We have compromised. However, we can go no further with concessions which impact the fundamental objectives of our reform: to focus legal aid on the highest-priority cases while delivering the essential savings needed to address the deficit which is threatening this country’s stability.

I was at a conference the other day where the noble Lord, Lord Bach, used a term which he may have been saving up for his final remarks. He said that next year we face a “perfect storm” in terms of welfare, in that we are indeed carrying through the LASPO reforms and the welfare reforms at the same time. That is going to introduce strain. However, the perfect storm would be if we lost control of our currency and economy, and if we lost markets. That is when the people whom we have heard about today, whom people want to protect, would really feel the full blast of economic problems. We are trying to—

Lord Howarth of Newport: I am grateful. The noble Lord used to tell the House that taking welfare benefits out of the scope of legal aid would save £25 million, but we know also that his department is dumping all kinds of costs on other departments through the health consequences and the damage to vulnerable children living in circumstances of great poverty.

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What is the noble Lord’s assessment now of the net contribution to reducing the deficit made by his policy of removing access to justice for some of the neediest people in our society? Does he still think that it is £25 million? Does he think it is less? Does he think that that is the crucial difference that is going to avert fiscal disaster?

Lord McNally: I do not believe that these matters remove access to justice. I notice that an organisation called MyLegal put out quite a long briefing, the interesting bit of which was on the last page, where it said that Ken Clarke had said these measures would cost £25 million. The briefing said that that was wrong and that it was £14 million. The noble Lord, Lord Bach, said that it would cost only £5 million. What I do know is that it will have a cost. When I am carrying out my other responsibilities in the Ministry of Justice and I am suddenly told by this House, which has no responsibilities in the Ministry of Justice, that I have to find £5 million, £15 million or £25 million, there are decisions that must be made. I sit on boards where people lose their jobs and where the management of these changes is extremely difficult. I have never tried to hide that but I ask this House to have a sense of responsibility. We came up with a concession after a lot of exploration and talks with departments and various boards. It is a narrow concession but it comes on top of a whole range of other concessions which we believe retain legal aid in a vast swathe of the process of welfare and which we think is in keeping with the promises we made to Parliament.

I ask this House not to go further in voting on this. I must make it clear that, if the amendment is carried and this concession is lost, the Act is still an Act of Parliament and will still be implemented in April but without this concession. I would consider that a rather pyrrhic victory.

Lord Pannick: My Lords, I am very pleased that the Minister has agreed to bring forward amending regulations that will deal with Regulation 53(b) and I thank him for considering the points that have been made in the debate. He mentioned that the regulations would focus on whether the alternative remedy is effective. I hope that when he and his officials read the record of this debate, they will see that the concern is that the criterion should state that the issue is whether the alternative remedy is a reasonable one to use in all the circumstances. It is not just a question of efficacy; it is also a question of speed and convenience, for example. The Minister indicated that he would consult noble Lords who have expressed concern about this. I very much hope that he will take further advantage of the free legal advice available from, in particular, the noble and learned Lords, Lord Mackay of Clashfern, Lord Woolf and Lord Goldsmith. I would be very happy to act as their junior in this respect. On that basis, I beg leave to withdraw my amendment.

Amendment to the Motion withdrawn.

Motion agreed.

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Legal Aid, Sentencing and Punishment of Offenders Act 2012 (Amendment of Schedule 1) Order 2012

Legal Aid, Sentencing and Punishment of Offenders Act 2012 (Amendment of Schedule 1) Order 201210th Report from the Joint Committee on Statutory Instruments

Motion to Approve

6.33 pm

Moved By Lord McNally

That the draft order laid before the House on 29 October be approved.

Relevant document: 10th Report from the Joint Committee on Statutory Instruments

Amendment to the Motion

Moved by Lord Bach

As an amendment to the above Motion, leave out from “that” to the end and insert “this House declines to approve the draft Order laid before the House on 29 October as it does not fulfil the undertaking given by Her Majesty’s Government on 17 April; and will mean claimants, including a disproportionate number of disabled people, will not receive legal help on a point of law in first-tier tribunals relating to welfare benefits thus denying them a fair hearing on point of law cases”.

Lord Bach: My Lords, I spoke to my amendment earlier in the debate and the House will be relieved to hear that I have very few words to say at this stage. My case is this: how can it be right that there is automatic legal aid for any client who gets to the second-tier or upper tribunal—the Court of Appeal and the Supreme Court—on a welfare law case but no automatic right to legal aid for first-tier tribunals? You can get to the second-tier tribunal or the Court of Appeal or the Supreme Court only on a point of law. If that is the position, how can it be right that at a first-tier tribunal, when a client has a point of law, they should not be allowed some legal advice before the first-tier tribunal commences—in other words, before the first-tier tribunal or during it? It is no use being able to get it at the very end of the first-tier tribunal in very remarkable and odd circumstances.

The Government seem to believe that was appropriate logic because that is the concession they were generous enough to make in the House of Commons on 17 April 2012. But they have not kept to that concession. They have come up with something much more vague; something that will happen in very, very few cases.

I am very grateful to the Minister for the time he has taken with this and to all noble Lords who have spoken on my amendment. When the Minister answered a question from me the other day he said:

“I want to make sure that we maintain a legal aid system that will remain one of the most generous in the world and focus it on the most needy”.—[Official Report, 27/11/12; col. 90.]

Can noble Lords think of anyone who is more needy than the sort of person that the noble Baroness, Lady Doocey, was describing—a disabled person who has undergone some of these tests in order to get her or his benefits, who is not happy with the result, thinks something has gone wrong and wants to appeal? What the Government are intending is that that person

3 Dec 2012 : Column 490

should not have the ability to get legal aid in order to appeal to the first-tier tribunal even when the matter is a point of law which they cannot be expected to know or understand. It defies logic and fairness to suggest that kind of process should continue.

All we are asking is that the Government withdraw this Motion, which they are clearly not prepared to do tonight. If they will not withdraw it, I shall ask the House, in a completely non-partisan spirit, to decline to give approval to this Motion tonight and invite the Government to come back with a slightly more generous order that looks after the type of person the noble Baroness, Lady Doocey, was telling us about earlier in our debate.

Lord McNally: My Lords, we are almost on the verge of another financial Statement by the Chancellor. I have made it clear that the noble Lord must not lure the House into an idea that following him into the Division Lobby will produce a better offer because it will not.

Lord Bach: Is the noble Lord saying that he will not come back with anything on this matter if this amendment is carried? I think that that is a threat that the House should be very wary of accepting at such a late stage in the debate.

Lord McNally: It is not a threat. I just do not want the House to make a decision on such an idea. This is not the Committee stage of a Bill. The order relates to what is already an Act of Parliament. If we do not bring forward another order in this area, the Act simply will go through. I want the House to be aware of that fact.

Lord Bach: There is a framework Act of Parliament, passed by Parliament, which I have never sought to go behind. These orders add flesh to those bones. This is a very important order. In any event, the Government would have to have some kind of order on these matters. On this occasion, the Government have, in effect, not kept with the intention that they certainly had in the House of Commons. By announcing what they did in the Commons, they managed not to lose a vote and to get the Bill through. As a consequence, it is a serious matter.

Lord Phillips of Sudbury: I am grateful to the noble Lord, Lord Bach—I almost said “my noble friend”, which he is. My noble friend Lord McNally has not commented on the noble Lord’s fundamental assertion on which, for me, the strength of the case rests; namely, that the former Lord Chancellor made a clear undertaking which is now not being kept. Would it not be helpful to the House for the noble Lord, Lord Bach, to ask my noble friend Lord McNally for his comment on that?

Lord Bach: That would be a fair question to the noble Lord, Lord McNally, who has had every opportunity to answer it and has chosen not to.

Lord McNally: I will answer it—I answered it in my remarks. The Lord Chancellor said that he would take the matter away and use his best endeavours. I have seen the exchange of papers with the DWP, the Legal

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Services Commission and the Administration on whether this could be done. We have come back with our best endeavours. This casual throwing around of betrayal fires the troops up for voting but it simply is not true.

Lord Bach: I would not dream of using the word betrayal as regards this matter. The noble Lord misunderstands me completely. It is not a betrayal. The governing party in the House of Commons said that it intended to do something and, in that way, managed to get an adverse amendment withdrawn. It has come up with a solution but the solution is not the concession that it made in the House of Commons. That is the fact of the matter. It is a much narrower solution and it is deeply unsatisfactory for those who are interested in how the poor, the disabled and the vulnerable are looked after in our society and their rights to access to justice.

For that reason, I ask the House to decline to approve this order, so that the Government can think again and come back with an order which we can all accept. I beg to move.

6.41 pm

Division on Lord Bach’s amendment.

Contents 201; Not-Contents 191.

Amendment agreed.

Division No.  1


Aberdare, L.

Adams of Craigielea, B.

Ahmed, L.

Anderson of Swansea, L.

Andrews, B.

Armstrong of Hill Top, B.

Bach, L.

Bakewell, B.

Barnett, L.

Bassam of Brighton, L. [Teller]

Beecham, L.

Berkeley, L.

Best, L.

Bichard, L.

Bilimoria, L.

Billingham, B.

Bilston, L.

Blair of Boughton, L.

Borrie, L.

Bradley, L.

Brooke of Alverthorpe, L.

Brookman, L.

Browne of Belmont, L.

Browne of Ladyton, L.

Campbell-Savours, L.

Carter of Coles, L.

Chandos, V.

Christopher, L.

Clancarty, E.

Clark of Windermere, L.

Clinton-Davis, L.

Collins of Highbury, L.

Corston, B.

Coussins, B.

Crawley, B.

Davidson of Glen Clova, L.

Davies of Coity, L.

Davies of Oldham, L.

Dean of Thornton-le-Fylde, B.

Deech, B.

Desai, L.

Donaghy, B.

Donoughue, L.

Doocey, B.

Dubs, L.

Elder, L.

Elystan-Morgan, L.

Evans of Temple Guiting, L.

Evans of Watford, L.

Farrington of Ribbleton, B.

Faulkner of Worcester, L.

Filkin, L.

Ford, B.

Foster of Bishop Auckland, L.

Foulkes of Cumnock, L.

Gale, B.

Gibson of Market Rasen, B.

Golding, B.

Goldsmith, L.

Gordon of Strathblane, L.

Gould of Potternewton, B.

Grey-Thompson, B.

Grocott, L.

Guildford, Bp.

Harries of Pentregarth, L.

Harris of Haringey, L.

Harrison, L.

Hart of Chilton, L.

Haskel, L.

Haworth, L.

3 Dec 2012 : Column 492

Hayter of Kentish Town, B.

Healy of Primrose Hill, B.

Henig, B.

Hilton of Eggardon, B.

Hollick, L.

Hollis of Heigham, B.

Howarth of Newport, L.

Howells of St Davids, B.

Howie of Troon, L.

Hoyle, L.

Hughes of Stretford, B.

Hughes of Woodside, L.

Hunt of Kings Heath, L.

Irvine of Lairg, L.

Janner of Braunstone, L.

Jay of Paddington, B.

Jones, L.

Jones of Whitchurch, B.

Jordan, L.

Judd, L.

Kennedy of Southwark, L.

Kennedy of The Shaws, B.

Kerr of Kinlochard, L.

King of Bow, B.

King of West Bromwich, L.

Kinnock, L.

Kinnock of Holyhead, B.

Kirkhill, L.

Knight of Weymouth, L.

Layard, L.

Lea of Crondall, L.

Liddle, L.

Lipsey, L.

Lister of Burtersett, B.

McAvoy, L.

McDonagh, B.

Macdonald of Tradeston, L.

McIntosh of Hudnall, B.

MacKenzie of Culkein, L.

Mackenzie of Framwellgate, L.

McKenzie of Luton, L.

Mallalieu, B.

Mandelson, L.

Mar, C.

Martin of Springburn, L.

Masham of Ilton, B.

Massey of Darwen, B.

Maxton, L.

Meacher, B.

Mitchell, L.

Moonie, L.

Morgan, L.

Morris of Aberavon, L.

Morris of Handsworth, L.

Morris of Yardley, B.

Noon, L.

Nye, B.

O'Neill of Bengarve, B.

O'Neill of Clackmannan, L.

Ouseley, L.

Palmer, L.

Pannick, L.

Patel of Blackburn, L.

Patel of Bradford, L.

Pendry, L.

Peston, L.

Pitkeathley, B.

Plant of Highfield, L.

Ponsonby of Shulbrede, L.

Prashar, B.

Prescott, L.

Prosser, B.

Quin, B.

Radice, L.

Ramsay of Cartvale, B.

Ramsbotham, L.

Rea, L.

Reid of Cardowan, L.

Rendell of Babergh, B.

Robertson of Port Ellen, L.

Rooker, L.

Rosser, L.

Rowlands, L.

Royall of Blaisdon, B.

St John of Bletso, L.

Sandwich, E.

Sawyer, L.

Scotland of Asthal, B.

Sheldon, L.

Sherlock, B.

Simon, V.

Smith of Basildon, B.

Smith of Finsbury, L.

Smith of Gilmorehill, B.

Snape, L.

Soley, L.

Stern, B.

Stevenson of Balmacara, L.

Stoddart of Swindon, L.

Symons of Vernham Dean, B.

Taylor of Blackburn, L.

Taylor of Bolton, B.

Temple-Morris, L.

Thornton, B.

Tomlinson, L.

Tonge, B.

Triesman, L.

Tunnicliffe, L. [Teller]

Turnberg, L.

Turner of Camden, B.

Uddin, B.

Wall of New Barnet, B.

Warner, L.

Warnock, B.

Warwick of Undercliffe, B.

Watson of Invergowrie, L.

West of Spithead, L.

Wheeler, B.

Whitaker, B.

Whitty, L.

Wigley, L.

Williams of Baglan, L.

Wills, L.

Wilson of Tillyorn, L.

Winston, L.

Wood of Anfield, L.

Woolf, L.

Woolmer of Leeds, L.

Worthington, B.

Young of Hornsey, B.

Young of Norwood Green, L.


Addington, L.

Ahmad of Wimbledon, L.

Alderdice, L.

Allan of Hallam, L.

Anelay of St Johns, B. [Teller]

Arran, E.

Ashton of Hyde, L.

Astor of Hever, L.

Attlee, E.

Baker of Dorking, L.

Bates, L.

Berridge, B.

Black of Brentwood, L.

Blackwell, L.

Blencathra, L.

Bonham-Carter of Yarnbury, B.

Bowness, L.

3 Dec 2012 : Column 493

Brabazon of Tara, L.

Bridgeman, V.

Brinton, B.

Brittan of Spennithorne, L.

Brooke of Sutton Mandeville, L.

Brookeborough, V.

Brougham and Vaux, L.

Browning, B.

Burnett, L.

Buscombe, B.

Byford, B.

Caithness, E.

Cathcart, E.

Cavendish of Furness, L.

Chalker of Wallasey, B.

Colwyn, L.

Condon, L.

Cope of Berkeley, L.

Courtown, E.

Craig of Radley, L.

Craigavon, V.

Crickhowell, L.

Cumberlege, B.

De Mauley, L.

Dear, L.

Dholakia, L.

Dixon-Smith, L.

Dobbs, L.

Eccles, V.

Eccles of Moulton, B.

Eden of Winton, L.

Edmiston, L.

Elton, L.

Empey, L.

Erroll, E.

Faulks, L.

Fearn, L.

Feldman of Elstree, L.

Fink, L.

Fookes, B.

Forsyth of Drumlean, L.

Fowler, L.

Framlingham, L.

Fraser of Carmyllie, L.

Freeman, L.

Freud, L.

Garden of Frognal, B.

Gardiner of Kimble, L.

Gardner of Parkes, B.

Geddes, L.

German, L.

Glasgow, E.

Gold, L.

Goodlad, L.

Goschen, V.

Grade of Yarmouth, L.

Green of Hurstpierpoint, L.

Hamilton of Epsom, L.

Hanham, B.

Harris of Peckham, L.

Henley, L.

Heyhoe Flint, B.

Hill of Oareford, L.

Hodgson of Astley Abbotts, L.

Howard of Lympne, L.

Howard of Rising, L.

Howe, E.

Howell of Guildford, L.

Hunt of Wirral, L.

Hurd of Westwell, L.

Hussain, L.

Hussein-Ece, B.

Inglewood, L.

James of Blackheath, L.

Jenkin of Kennington, B.

Jenkin of Roding, L.

Jolly, B.

Jopling, L.

King of Bridgwater, L.

Kirkham, L.

Knight of Collingtree, B.

Laming, L.

Lee of Trafford, L.

Lexden, L.

Lingfield, L.

Liverpool, E.

Loomba, L.

Luce, L.

Luke, L.

Lyell, L.

McColl of Dulwich, L.

Mackay of Clashfern, L.

MacLaurin of Knebworth, L.

McNally, L.

Maddock, B.

Maginnis of Drumglass, L.

Marks of Henley-on-Thames, L.

Marland, L.

Marlesford, L.

Mawhinney, L.

Mawson, L.

Mayhew of Twysden, L.

Montrose, D.

Moore of Lower Marsh, L.

Morris of Bolton, B.

Moynihan, L.

Naseby, L.

Neville-Jones, B.

Newby, L. [Teller]

Newlove, B.

Noakes, B.

Northover, B.

Norton of Louth, L.

Oakeshott of Seagrove Bay, L.

Palmer of Childs Hill, L.

Palumbo, L.

Parminter, B.

Plumb, L.

Popat, L.

Randerson, B.

Rawlings, B.

Razzall, L.

Redesdale, L.

Renfrew of Kaimsthorn, L.

Ribeiro, L.

Roberts of Conwy, L.

Roberts of Llandudno, L.

Rodgers of Quarry Bank, L.

Rogan, L.

Ryder of Wensum, L.

Sassoon, L.

Scott of Needham Market, B.

Seccombe, B.

Selborne, E.

Selkirk of Douglas, L.

Selsdon, L.

Shackleton of Belgravia, B.

Sharkey, L.

Sharples, B.

Shaw of Northstead, L.

Sheikh, L.

Shephard of Northwold, B.

Shrewsbury, E.

Shutt of Greetland, L.

Smith of Clifton, L.

Spicer, L.

Stedman-Scott, B.

Stephen, L.

Stewartby, L.

Stoneham of Droxford, L.

Stowell of Beeston, B.

Strathclyde, L.

Taylor of Goss Moor, L.

3 Dec 2012 : Column 494

Taylor of Holbeach, L.

Teverson, L.

Tope, L.

Tordoff, L.

Trimble, L.

True, L.

Tugendhat, L.

Tyler, L.

Tyler of Enfield, B.

Ullswater, V.

Verma, B.

Wakeham, L.

Wallace of Saltaire, L.

Wallace of Tankerness, L.

Walmsley, B.

Warsi, B.

Wasserman, L.

Wei, L.

Wheatcroft, B.

Wilcox, B.

Younger of Leckie, V.

Motion, as amended, agreed.

Palestine: United Nations General Assembly Resolution

Question for Short Debate

6.52 pm

Tabled By Baroness Royall of Blaisdon

To ask Her Majesty’s Government what discussions they have had with the Palestinian Leadership in the light of the outcome of the debate on the Resolution on the status of Palestine within the United Nations at the United Nations General Assembly on 29 November.

Baroness Royall of Blaisdon: My Lords, like all Members of this House, I believe that the two-state solution is and must be the solution to the Israeli-Palestinian conflict; that is, a safe and secure Israel living alongside a viable and sovereign Palestinian state based on 1967 borders, with agreed land swaps, with Jerusalem as the shared capital of both states and with a just, fair and agreed settlement for refugees.

However, as both the Foreign Secretary Mr William Hague and my right honourable friend Mr Douglas Alexander have said countless times over the past few weeks:

“Time is running out for a two-state solution”.

The news that Israel has seized more than $120 million of the tax revenues it collects on behalf of the Palestinian Authority has made the situation much more dangerous, as has the announcement that Prime Minister Netanyahu has authorised the construction of 3,000 new homes and settlements and the speeding up of 1,000 existing planning permissions. Indeed, the UN Secretary-General has said that this could be,

“an almost fatal blow to remaining chances of securing a two-state solution”.

Last week, there was a massive vote at the UN General Assembly in favour of Palestine moving from an observer entity to an observer state at the United Nations. There were 138 nations in favour, including France and Spain; nine against; and 41 abstentions, including the United Kingdom. This was a strong global signal in favour of an independent Palestinian state. It also happened to reflect the views of the British people: 72% of respondents in a recent YouGov poll said that they were in favour of recognising the Palestinian state, and only 6% were against. Ephraim Sneh, a former Israeli Deputy Defence Minister, said before the vote that,

3 Dec 2012 : Column 495

“Abbas’s statehood bid can be a game-changer if the American and Israeli governments respond prudently. Or it can be another missed opportunity—and a potentially disastrous one at that—if they respond punitively to a remarkable Palestinian achievement at the UN General Assembly”.

Sadly, prudence has been abandoned by the Israeli Government.

We strongly believe that the British Government were wrong not to support the Palestinian resolution. It is one of the steps to achieve and negotiate a two-state solution. The fact that we abstained was an abdication of responsibilities to both the Israeli and Palestinian people, most of whom wish to live in peace. The vote was also an important means of demonstrating support for President Abbas, crucial at any time but especially in light of the most recent conflict in Gaza, in which the power and influence of Hamas were enhanced. The Palestinians not only wanted Palestine to be recognised as a state—a prerequisite, I suggest, for a two-state solution that is impossible when only one side is recognised as a state—they also wanted a strong leader. They, like the world, wanted tangible proof that diplomacy works better than rockets.

In the House of Commons last week, Mr Hague said that Government relations with President Abbas were excellent. Indeed, I hope that they are. However, I wonder what the Palestinians think of our position now that the feared retributions have begun. I have no doubt that the Middle East will be a priority for President Obama in his second term of office. However, the UK’s abstention will not have helped—quite the contrary—and it will have diminished our position as a global leader in the eyes of the world.

Before the vote, the Foreign Secretary said that recognition at the UN risked paralysing the peace process, but for far too long there has been only paralysis and no process. There has been continued settlement building, and continued rocket attacks, but no process. I utterly condemn the rocket attacks from Gaza. Like many parliamentarians, I have visited Sderot and spoken with the Israelis whose lives are blighted by rocket attacks—and constant fear. However, I have also seen the settlements, which I utterly condemn and which are against international law. Each house built entrenches the Israeli occupation of Palestine and makes Israel and its people less, rather than more, secure.

Last week’s announcement that some of the new construction would be in E1 has alarmed the global community. E1 is a five-square mile controversial development on the outskirts of Jerusalem that would partly divide the West Bank and would hugely complicate efforts to create a contiguous Palestinian state. Former Israeli Prime Minister Ehud Olmert has called it,

“the worst slap in the face of a US President”.

I welcome Mr Hague’s comments that:

“Israeli settlements are illegal under international law and undermine trust between the parties. If implemented, these plans would alter the situation on the ground on a scale that makes the two-state solution, with Jerusalem as a shared capital, increasingly difficult to achieve”.

Mr Hague is absolutely right. I understand that Israel’s ambassador has been called to the Foreign Office for a meeting with Alistair Burt, the Minister for the Middle East. Clearly this is the right thing to do, but it will not

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undo the damage done to Britain’s standing on this issue as a consequence of its misguided abstention. The Minister will know that there has been much press speculation today that our ambassador in Tel Aviv could be withdrawn. I would be grateful for clarification. What discussions has the Foreign Secretary had on this issue with the noble Baroness, Lady Ashton, the EU’s High Representative?

It is said that Mr Netanyahu is taking these actions with one eye on the elections in January. I suggest that the crisis in the Middle East is too important for the area to be used as a political football. Indeed, it is terrifying. Then, of course, there are the tax revenues, collected by Israel on behalf of the Palestinian Authority, which Israel has refused to hand over and which it will review on a monthly basis. This punitive action is intolerable and again exacerbates tensions and frustrations rather than enhancing the safety and security of Israel. In the past, when Israel has frozen the monthly revenues of the Palestinians it has resulted in the late payment of salaries for thousands of public servants in the West Bank and Gaza.

I wholeheartedly condemn violence but is it any wonder that the level of anger is heightened when men and women can no longer provide for their families? These tax revenues are not gifts to buy treats; they are moneys owed to the Palestinians on which they rely for their day-to-day existence. I would be grateful if the Minister would say what representations the Government have made to the Israeli Government on this critical matter, and what discussions they have had with Secretary of State Clinton.

I have no doubt that the Saudis and other friends of the Palestinians in the Arab world will do what they can to assist financially. This would be an understandable and welcome short-term solution for the Palestinians, but it cannot be sustainable for any of the parties concerned, including Israel. I wonder what the British Government will do on the issue. For the past four years there has been a near-total cessation of terrorist activity in the West Bank, partly as a result of co-operation between the Israel Defence Forces and the Palestinian security forces, organised by Lieutenant General Keith Dayton’s team. However, if the Palestinian economy collapsed as a result of external economic pressures, the situation could easily be reversed and Israel would become even more vulnerable.

The vote in the UN last week demonstrated that the world wants a solution to the Israeli-Palestinian conflict: a two-state solution in which both states live in security and with dignity. Whereas recognition of Palestine as a state by giving it observer status at the UN is a positive step forward, the subsequent announcements by the Israeli Government are a deeply worrying development that could jeopardise hopes for peace. The UK’s ill judged abstention at the UN was supposed to secure continuing influence with Israel, but there is little evidence of that strategy working. I now urge the Government to co-ordinate their actions with European partners so that further steps can be taken to help ensure that Israel complies with international law and demonstrates a commitment to peace. Most urgently, I trust that all efforts will be made to ensure that Prime Minister Netanyahu hears this message loud and clear when he meets Chancellor Merkel in Berlin on Wednesday.

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7.01 pm

Lord Alderdice: My Lords, I commend the noble Baroness for securing a debate at this time on an issue that transcends all party differences. On 29 November 1947, the United Nations voted in Resolution 181—with 33 for, 13 against and 10 abstentions: in other words, voted very powerfully—for the establishment of the State of Israel. It also wanted to see the establishment of a Palestinian state. On 29 November 2012, the United Nations voted again, and 138 out of the now 193 member states voted for the possibility of moving towards a new member state. They did not declare that it was a state, only that it was moving towards being a state.

Who voted against? Panama, Palau, Nauru, Micronesia, the Marshall Islands, the Czech Republic, Israel, the United States and Canada. How is it possible that the State of Israel, which was brought into being by an overwhelming majority vote in the United Nations, has contrived over the subsequent years to so lose the confidence of other member states that it finds itself with so little support in its opposition to the perfectly reasonable demand for a Palestinian state?

The peace process has been paralysed for years. There has been no peace process for years. I speak as someone who spends a considerable amount of time working on this issue and on events in the region. Huge changes are taking place—and they are not for the better. The world has changed. I do not think that some of our colleagues in this country, in Israel and certainly in the United States realise that the world has already changed. It is the kind of change that took place in the run-up to, and after, the First World War. The balance of power is different. Changes take place because of changes in technology. Having massive military power in the old sense no longer cuts it. It no longer stops or starts major political change.

It is said by many in the Israeli establishment that there is no partner for peace. Therefore, what is the objection to recognising a nascent state that can become a partner for peace? If there is to be a partner for peace, and if the complaint is that Palestinians are fragmented, surely this creates the opportunity for the various elements in the Palestinian state to come together—for Hamas, Fatah and others to become a partner for peace. However, I think that we have gone beyond all of that. It is no longer clear that a two-state solution is possible. If it is not, there are only two other obvious possibilities that I can see. One is a single state, which manifestly cannot be a Jewish state if it is democratic. The other is some form of chaos and war in the region. It is wholly possible that that is what we are looking at: we are sliding into a regional war.

What is the alternative? It is that we look to a regional process to create stability in the region. Noble Lords will not be at all surprised that I speak about such a process because I have been banging on about it for years. I have not for years seen the possibility of Israel and the Palestinians negotiating an outcome, and I do not any more see the United States providing a particularly useful role in achieving it. There was a time when it could have. There was a time when the European Union could have played a role of

3 Dec 2012 : Column 498

this kind, but it is so intent on focusing on its internal problems that it has not been able to provide any kind of useful contribution to the peace process. There is a great urgency about the development of a regional process to save us from regional chaos and to give the possibility of the establishment of a Palestinian state living in peace and stability alongside the State of Israel.

In this regard, I say with great sadness that our country this time is on the wrong side of history. This is a serious error of judgment. This was an opportunity to rescue the reputation of this country in a region that has not been impressed by the military adventures of the past 10 or 15 years. It was an opportunity for our country to say clearly that we support our friends in the State of Israel but that we do not give them a veto on our policy, or who we talk to, or who we are prepared to engage with. I do not expect my friends to tell me who I can and cannot talk to; I expect them to come along with me to talk to people. If my friends say they want a partner, I try to establish a relationship with that partner. Instead, we as a country find ourselves closing in, in a way which—whatever our Israeli Government colleagues say—is not good for Israel, never mind for this country.

I spent the past weekend organising two international conferences in London. At the second was a very senior Israeli—a senior, very Jewish, very Israeli Israeli. His commitment to his country, in diplomatic, political, academic and security terms, had been, he said, “my whole life”. I asked him what he thought of the vote. He said: “Israel should have supported the vote. It should have made it clear that it wants a partner for peace and wants to give Palestinians an opportunity to get together as a state to be a partner for peace”. Recognition of a developing Palestinian state does not define its boundaries; that is part of the problem. It does not describe its population; that is part of the problem. It does not tell us how we are going to relate the various different Swiss-cheese parts of its territory; that is part of the problem. However, it does give a partner with whom to engage in a peace process.

It saddens me greatly, and frightens me greatly, that we face such dangerous times in that region, from which we will not escape. On this occasion our Government did not do the right thing for the country. I hope that they can review their approach, not in terms of the vote, as the vote is past, but in terms of how we engage to ensure a regional process towards stability. Otherwise we will, I fear, observe a regional descent into chaos.

7.10 pm

The Lord Bishop of Guildford: My Lords, I am very grateful to the noble Baroness, Lady Royall, for raising this urgent, peace-threatening question. Your Lordships may be aware that the right reverend Prelate the Bishop of Exeter, together with the Roman Catholic bishop, Bishop Declan Lang of Clifton, had written to the Foreign Secretary in some regret at the UK’s abstention from the UN vote on Palestine’s non-member observer status. They—and all of us on these Benches, irrespective of our views on voting or abstention—urge Her Majesty’s Government to do everything possible to revitalise the stalled peace process in the Middle East.

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I am particularly grateful that the last speech highlighted the importance of a regional peace discussion. We understand the desire to urge all parties to desist from actions—such as a Palestinian appeal to the International Criminal Court—which would make a restart of discussions, whether completely international or more regional, more difficult. Yet is there not a desperate need to signal that there must be a way forward through international law, which the new Palestinian status surely indicates, lest despair of a two-state solution, or any other solution, lead to the resumption of violence such as the firing of rockets from Gaza, which has already been alluded to? That could slide into the regional war to which the noble Lord, Lord Alderdice, has just alerted us.

My stress on a solution grounded in international law is a point which the right reverend Prelate the Bishop of Exeter would have made had he been in his place. He is in fact visiting some of his flooded churches today. This stress enables me warmly to welcome today’s news from the Foreign Office of the summoning of the Israeli ambassador to meet the Minister with responsibility for Middle East affairs. Afterwards a spokesman mentioned the Government’s potential “strong reaction” to Saturday’s announcement of Israel’s building plans between east Jerusalem and the West Bank. These plans seem, to my judgment, an absolute roadblock to the resumption of any progress and any new negotiations. There are many things on either side which could threaten the only real option for peace—the resumption of discussions, which is the only real option for security for Israel, as has already been mentioned. Continued building on the wrong side—the wrong side in international law; the wrong side of the green line—is, in my view, the most serious threat of all.

7.13 pm

Lord Janner of Braunstone: First, my Lords, I apologise: I did not realise that the debate was going to start so very early. However, I am honoured and delighted to be here.

During my career and personal life I am proud to have worked, and continue to work, for both Jews and Arabs who are in Israel and the neighbouring countries. I have spent much of my time building bridges between their communities—working together on our similarities and differences, discussing how we live, and, more importantly, discussing how they can live happily together. That is why I believe it is essential that we work to support both Israel and Palestine to reach a two-state solution where the Jewish have their state—Israel—and the Arabs have their own state: Palestine. The Palestinians’ win at the United Nations General Assembly shows how many countries also agree that they deserve to have their own state. However, the remaining number of noes and abstentions demonstrates how the resolution still needs to be both discussed and developed.

Our Government did not vote yes. Last Thursday in the United Nations they abstained, showing how we in Britain do not completely dismiss the Palestinians’ rights but acknowledge that there are a number of issues that must be spoken about in order for our Government to agree wholly to the increase in Palestine’s status at the United Nations.

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The shadow Foreign Minister, Douglas Alexander, spoke in the other place in a debate last Wednesday before the UN vote. He said:

“what I believe will be an overwhelming majority of the 193 members of the UN General Assembly in voting for enhanced observer status for the Palestinians. That vote can, and must, send a powerful signal to the Palestinians that diplomatic efforts and the path of politics, not the path of rockets and violence, offer the route to a negotiated two-state solution”.—[

Official Report,

Commons, 28/11/12; col. 230.]

That is what we must all hope will occur.

As this House knows, only a week before this vote, Gaza and Israel were in conflict with rockets flying from both sides, and, sadly, there were casualties on both sides. Since Israel left Gaza in 2005 countless rockets have been fired from Hamas-run Gaza, and Hamas uses innocent citizens to hide behind. We must all acknowledge Israel’s right to defend its own country. We cannot ignore that Israel, like Palestine, has a right to exist. Hamas saw the results on 29 November as a victory. It is important for the Palestinian people but Hamas is not there to benefit its people. It is not the Government; it is a terrorist group that uses its own citizens as shields to hide its operations. It is a group which publicly announces the annihilation—the annihilation—of the State of Israel.

Whether you say shalom or salaam, it is this word—which means peace—to which we must always return. We must all work together for peace in that area. How do the Government consider the UN results on the status of Palestine will encourage them to go back to the negotiations when they have refused to take part in the past two years?

Before I finish, I would like to tell a fable of a London man who once went to a law society and asked to be recommended to a one-armed solicitor. “Why one-armed?”, asked the official. “Because,” the man replied, “I am sick to death of lawyers saying, on the one hand this, and on the other hand that”. That was a perfectly good reason for wanting somebody with one hand. On the one hand, if you do not recognise that others have a case, you will lose yours. On the other hand, if you do not put your case firmly, then you will not be an advocate for long. And without any hands, you certainly cannot clap. One Hand Alone Cannot Clap is the name of a book that I wrote some years ago about Israel and the Middle East. It is important that we acknowledge that you cannot base arguments or work for peace with only one side. No one would argue against the rights for the Palestinian people to have their own home, and this is also so true for Israel. We must all learn to clap together and to live happily and peacefully side by side.

7.18 pm

Lord Palmer of Childs Hill: My Lords, the noble Baroness, Lady Royall, asked a very important and interesting Question. My noble friend Lord Alderdice referred to the United Nations vote in 1947. Many people seem surprised that the UK abstained in the vote to upgrade the status of Palestine at the UN. However, students of history will appreciate—this has not yet been pointed out—that this abstention follows the precedent of Britain abstaining in the 1947 vote on the UN partition plan leading to the creation of the

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State of Israel. Some things do not change. It has always been a foregone conclusion at this time of the United Nations that a large majority of nations, including the Islamic and non-aligned states, would vote in favour of the UN’s de facto recognition of Palestinian statehood. Some things have changed since 1947.

We can achieve the desirable result of a Palestinian state alongside a secure Israel only by joint negotiations between the two parties. I quote from a newspaper this weekend, which stated:

“Mr Abbas has said he will not return to talks, which were broken off in 2010, without a freeze in settlement building, ignoring Israeli calls for a resumption of negotiations without preconditions”.

I am against the expansion of settlements. However, even an amateur prophet could have predicted that the Israeli reaction to the UN vote would be to announce the approval of construction of new settler homes. The E1 proposed area which the noble Baroness, Lady Royall, referred to only has preliminary zoning and planning. Although that is bad enough, it is not actually in the building stage.

I hope that Her Majesty's Government will stress to the Palestinian leadership—which is the point of the noble Baroness’s Question—that if it wants to stop the building, it had better get to the negotiating table as quickly as possible. Surely Mr Abbas does not want the same said about him as was said about Mr Arafat: that he lost no opportunity to lose an opportunity. The man who said that, Abba Eban, an Israeli Foreign Secretary, also once said that if Algeria introduced a General Assembly resolution that the world was flat and Israel had flattened it, it would pass 100 to 10 with about 50 abstentions.

President Abbas is requesting recognition for a state half of which he does not even control. Since Hamas took power in Gaza in 2006, Mr Abbas, as far as I know, has not visited there even once. The resolution pushes further away the prospects for peace. The only way to achieve peace is through direct negotiations, and I hope that my noble friend the Minister will stress this to both sides. Unfortunately for ordinary Palestinians, they will see little gain from the UN achievement. The Gaza Strip will remain under the rule of Hamas. The move seems more likely to undermine prospects for reviving the peace process, as described eloquently by my noble friend Lord Alderdice, except for one redeeming feature; namely, improving President Abbas’s reputation on the Arab street. Not negotiating with Israel has been Mr Abbas’s choice in recent years, whether due to his distrust of Israel or due to his own unwillingness to make compromises. The move to the UN looks more like a continuing strategy to avoid negotiations and not a way to revive them.

When Mr Abbas first laid out his ambitions 18 months ago in the New York Times, he made it clear that he would use Palestine’s new status to try to confront Israel in international legal forums. That is not exactly conducive to peace. More than ever, Mr Abbas needed a domestic political win. This has only been heightened since the recent conflict between Israel and Hamas. The Palestinian Authority had become largely irrelevant in the international theatre until the UN vote.

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It must be noted that, in the past, the quiet co-operation between Israel and the Palestinian Authority has led to some genuine progress—not enough by a long way but some at least. What is needed is a de-escalation of tensions and a period in which each side commits, publicly or privately, not to take steps which antagonise the other, whether it is expanding settlements, which I disagree with absolutely, on the Israeli side, or unilateral moves in international organisations or legal bodies on the Palestinian side—and of course a cessation of hostilities from either side of the border.

If I was a public adviser to the Israelis, I certainly would not have advised them to announce the building of more settlements and a holding-back of taxation revenues. Perhaps I would have advised them to concentrate on what Israel does internationally in helping with world relief. When a massive earthquake struck Haiti, Israel was one of the first and most effective responders, using its undoubted technological know-how and experience for the benefit of others. Perhaps noble Lords have forgotten that, during Israel’s stay in Haiti, the medical delegation treated more than 1,110 patients, conducted 319 successful surgeries and delivered 16 births including three in Caesarean section. The IDF search and rescue force also performed very well. On irrigation projects around the world—the noble Lord, Lord Alderdice, spoke about the conference that he organised the other day—Israel is a world leader in water technology to develop new water sources, use the water that we have most efficiently and recycle waste water. We need more desalination plants around the Middle East and not just in Israel. On aid or advice to other regimes, according to MASHAV, an Israeli organisation, Israel has used its expertise to transform agriculture from traditional subsistence to sophisticated market-oriented production. It is for this reason that many countries in the developing world have sought partnership with Israel in addressing their agricultural challenges. Since 1958, MASHAV has trained in Israel and abroad almost 200,000 course participants from approximately 140 countries and has developed dozens of demonstration projects worldwide in fields of expertise.

If I were one of those mythical public relations consultants, perhaps I would also talk about the life-saving technology which has emanated from Israel. It is hard to know where to start. Hadassah University and the Weizmann Institute have produced scientists and Nobel laureates responsible for the research and development of important medical advances and life-saving techniques. Israel leads the world in stem cell research, with important breakthroughs in repairing tissues and organs damaged by Parkinson’s disease. Teva Pharmaceutical Industries, headquartered in Israel, is the largest generic drug manufacturer in the world and has made an incredible effort in helping to combat diseases such as multiple sclerosis and Parkinson’s disease. Israel has broken ground in fertility treatment. There is the neuromedical electrical stimulation system, a glove-like device that can help paralysed people; there is imaging technology; and there is help for cancer patients and nanotechnology.

The responses from Israel on settlement expansion and tax revenues do not help, but they must be seen in a context where the Palestinians refuse to sit and negotiate and have taken a unilateral step which aggravates

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the situation. Israel has said time and again that it wants a two-state solution, as referred to by the noble Lord, Lord Janner. I ask Her Majesty’s Government and all parties to do as my noble friend Lord Alderdice said and work to a regional solution where all parties get people to the negotiating table. It is not too late to do so. There is a chance for a two-state solution, but it is up to us, Her Majesty’s Government and other Governments to help by getting the two sides to that table to negotiate before it is too late.

7.27 pm

Lord Judd: My Lords, it is obviously a time when we should all turn our minds to how we take things forward. However, in our concern about how we take things forward, it is also important to have some historical context for what has happened, and it is a long story.

We have special responsibility in this country towards Israel because we were one of the principal powers that played a key part in bringing Israel into existence and we must therefore not betray our responsibility in that context. It is also important to remember that, historically and objectively, no people paid a higher price for the creation of the State of Israel than the Palestinian people. It is important therefore to see both sides of the argument in history, because it is not just a current crisis that we face but a deeply rooted history.

I do not happen to believe that the West and our own country under successive Governments have been even-handed in their approach to this situation, when, if any issue in the world demanded even-handedness, it was this one. We have been pro-Israeli, and history will read the message very clearly. We may try to persuade ourselves that we were not letting down the Palestinians but we were, repeatedly. Where has our voice been on the blockade, on the screwing of the economy of Gaza? In two or three years’ time, the one remaining aquifer in Gaza will collapse, because spare parts have not been allowed in through the blockade to maintain it. Ninety per cent of the water in Gaza is not fit for human consumption. The schools, the health, and the economy of Gaza have been screwed.

Almost exactly a year ago I was in the West Bank and Jordan, and up until then I had not realised quite what the settlements meant. They are not just a few nice settlements—Israeli suburbs in the West Bank and Gaza—but fortified encampments with security gates. Palestinian life is absolutely distorted. People are humiliated day after day as they pass through the security gates, where they are treated rather brusquely, to say the least. Farmers are able to get to their land and back again only at certain specified hours. I asked what would happen if a farmer had a heart attack. The UNRWA people told me, “Well, somebody would have to get on to us, and we’d have to try to negotiate an arrangement with the Israelis so that the gates were opened to allow the people back”. We have not faced up to the realities of what is going on.

Another issue worries me very deeply. I recall how in 1967 I was in Israel for the duration of the war. I talked to Israelis then, who said to me, as they listened to militant, pro-Israeli language being broadcast into

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the country in the excitement of everything that was going on, “It’s all right for these people, but we’ve got to make a future with our neighbours and all the people in the region”. Israelis said that to me. Since then Israelis have refused to serve in the armed services, because they will not be part of what is going on, and other Israelis have made brave stands against these policies. Our absence of even-handedness has let down those brave and courageous Israeli people who have tried to advocate an alternative policy for their country.

We have to look to the future. We must not suddenly switch from our responsibilities. History will not allow us to do that. But it is because we have special responsibility for the creation of the State of Israel that we must always speak honestly and bluntly about what really matters for Israel’s survival. The truth of the matter is that the present policies of Israel—and we all know this—could not be better designed to undermine the future prospects of the people of Israel. They prolong the danger and the threats that will accumulate.

How will we approach the future? Reference has been made to the need for a regional approach, which I am sure is right. We must have a regional approach to secure the future. However, a regional approach cannot impose a solution. No one can impose a solution. The solution will have to be generated by the Palestinian and Israeli people. That is where it will come from. We have an example in our own history, that of Northern Ireland. If it is to work, it must have the commitment of the key parties, which will mean a readiness to talk to people with whom it may not be very easy to talk, just as we learnt that we had to talk to the political wing of the IRA if we were to make progress. That was critical.

However, we also learnt something else in that process in Northern Ireland: that we must keep any preconditions to an absolute minimum because they will only distort everything, and they will not be owned by the participants. Some of the things that as outsiders we see as obviously essential must come from the participants in the negotiations, who have to come to those conclusions themselves. They must go through a process of learning in the negotiations that go on. I am sure that the noble Lord, Lord Alderdice, would agree with me that that is exactly what happened in Northern Ireland.

We should also be encouraging and supporting them in practical co-operation. The conference on water organised by the noble Lord, Lord Alderdice, which I was so glad to be able to attend, was a very interesting example of this. It demonstrated how we can help them to get into practical situations in which they see their mutual interdependence.

The most important point of all is that a negotiated, lasting, enduring solution will have to be inclusive. It will have to draw in the widest possible cross-section of people. It is nonsense, and stupidity, to refuse to see that Hamas has to be part of the solution. This can no longer be tolerated, because of course it becomes a self-fulfilling prophecy. It undermines any chance of emerging moderate or more enlightened leadership in Hamas, and plays right into the hands of the extremists, who are there, and who will use Hamas for their own irreconcilable ideological religious—or other—objectives.

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This will take a lot of imagination. What is tragic—and I use the word in the real Greek sense—about the vote last week is that we marginalised ourselves. I hope that my noble friend, who introduced the debate with a particularly good speech, will not mind my saying that the Question refers to talks with the Palestinian leaders since the vote. I cannot imagine that we are very high on the Palestinians’ list of priorities for talks at this juncture.

7.36 pm

Lord King of Bridgwater: My Lords, I have not previously been involved in the debates on Israel and Palestine and the issues arising from them. I am extremely grateful to the noble Baroness for introducing this debate, because I wanted to express simply, as somebody who is much more of an observer than many of the experts who have spoken already, the great concern that I have about the situation.

I am progressively more alarmed about this region, which has already been referred to being in turmoil at the present time. This situation does not threaten merely continuing bitterness and violence between Israel and the Palestinians but threatens the region, and may threaten ourselves, in terms of world peace and stability, the possible involvement of the United States, and the consequences of events in Iran. A number of developments here pose the greatest danger to us. I have always supported the State of Israel and its existence. However, the current actions of the Israeli Government imperil the State of Israel itself. Voices of concern and friendship have a duty to speak out at this time.

The New Statesman had a headline this week, that Mr Netanyahu risked condemning Israel to perpetual war. The awful thought, in such a dangerous world, of the risk of continuing and escalating conflict of this kind, must concern us all. This is a time when Israel needs support. The noble Baroness referred to the vote in the United Nations, which was 138 to nine. Of the nine, as the noble Lord, Lord Alderdice, quoted, I had to look up who two of them were. One of them was Palau, which has a population of 20,000; another was Nauru, which has a population of 10,000; and the Marshall Islands came swinging in with a majority vote of 68,000. That is three votes in the United Nations with a smaller vote than the Isle of Wight in a constituency election. France, Italy and Spain came out against Israel, supporting the adoption of observer status for the Palestinians, while Germany, Holland, Australia and the United Kingdom abstained. I must say to my noble friend that I was disappointed that we abstained. I understand why the Foreign Secretary made that decision, but the Israeli reaction since has been a real slap in the face for him and others who had hoped for a more moderate response.

I say to the many noble Lords who express strong support for the State of Israel: does anyone in Israel still care about what the rest of the world actually thinks? It is deeply depressing at the present time. We have seen Mr Netanyahu going to America, snubbing the American President and marching straight off into a meeting of AIPAC, where he got a heroic reception, as he would. Against that background, it is deeply

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worrying. The Israelis are losing the support of countries that would have supported them strongly in the past. I had these thoughts even before the announcement of the disastrous reaction to the vote in the United Nations. Although the noble Lord, Lord Palmer, rather glossed over the decision to go ahead with preparations for E1 and the impact these have had on East Jerusalem, along with tax withholding and going ahead with more settlements, I certainly understood why Ban Ki-Moon said that it would be an “almost fatal blow” to hopes of peace. I am not sure that the present Israeli leadership under Mr Netanyahu actually has any intention of ever going forward with a two-state solution. I am afraid that that is the impression he gives outside the country. Everyone goes along with it, saying “That’s our policy”, but I am not sure whether he is ever going to move on it.

I much appreciated the speech of my noble friend Lord Alderdice. He and I know very well the old cry, “Not an inch and no surrender”, which I had shouted at me often enough in Northern Ireland, along with people trying to hit me over the head, but we knew that it was not the way out of the problem. Progress had to be made on both sides and, as the noble Lord, Lord Judd, said, it had to involve the people on both sides. They have to understand their best interests. No sensible Israeli wants to be in a state of perpetual war. The Israelis cannot want to be in that continuing situation, and no Palestinians want to find themselves in the present miserable situation.

Against that background, the scale of change that is taking place in the world and in that region cannot be overstated. I have seen, and no doubt so has Israel, the visits that are now being paid to Gaza. The Prime Minister of Egypt has been to Gaza, as has a senior representative or perhaps the Emir of Qatar. Senior representatives from Bahrain have been there, and now I see that Mr Erdogan of Turkey is talking about going as well. These developments are profoundly significant. Whether these decisions and the reactions to them are to help the election campaign of Mr Netanyahu in January—we are promised the election of an even more hawkish coalition—is not known, but one does weep very seriously, not least because we still have the elephant in the room in the shape of Iran and its nuclear weapons. One wonders what kind of approach a more hawkish coalition might take to that.

I will just add this. I used to visit America on behalf of Northern Ireland, and I found that many of the expat Irish—the Irish lobby—were much more inclined to scream “No surrender” or “A united Ireland at all costs”, and then I would talk to the Irish-American politicians like Ted Kennedy, Daniel Moynihan or Tip O’Neill, and they were the sensible ones. Charlie Haughey used to be picketed when he went over because the Irish lobby there thought he had sold out on Irish independence. The British ambassador to the United States would say to me, “The green lobby, the united Ireland lobby, is jolly strong over here, but it is not a patch on the Jewish lobby”. The truth is that the Jewish lobby in the United States has done no service to Israel and it has done no service to the standing of the United States in the region. Let us think back to when President Clinton could stand between Mr Rabin and Mr Arafat. He was seen as an impartial assister

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towards peace. America is now seen to be one-sided, voting against the Palestinian resolution and no longer commanding confidence. A nation of the power and scale of the United States could easily be a tremendous force for good in the region.

I believe that we are in a serious and rapidly developing situation, one that makes the world more dangerous. For all who care about the future of Israel and its continuing existence, and not least providing a civilised life for all those in the region, it is desperately important that they realise that a change of course must be undertaken. They must get rid of all the conditions, sit down and try to find a genuine approach towards a two-state solution, or I fear for where the future may go.

7.45 pm

Lord Phillips of Sudbury: My Lords, I had something of a conversion experience, I suppose it might be called when, like many, I went to Israel, the West Bank and Gaza for the first time in 2001. Up to that point I had read of the declining circumstances in Palestine, but I was and remain inexorably concerned about the security of Israel. For my whole adult life I have been an inveterate supporter of that country. I am a huge admirer of Israel in all sorts of ways, just as I am of the Jewish community in this country. It was not necessary for my noble friend Lord Palmer of Childs Hill to remind us of the philanthropic tendencies of Jews. In this country they have an unrivalled record of philanthropy. The tragedy is that a great country and a great people have so demeaned themselves and behaved in a manner that is not just contrary to international law but contrary to simple morality and decency that I genuinely believe that they are now on a suicide path. They are losing former friends and, I suspect, ordinary citizens across the world in droves. That is a tragedy.

I was so committed to the survival of Israel that the only time I have ever offered to fight for anyone was in 1973. I wrote to the Israeli embassy here, but fortunately for me the state of Israel was rather effective at rebutting the attack and I was not called up. When I first went to the region I could not believe my eyes. Anyone in the House who has not been there and who doubts the horrors of both the West Bank and Gaza should go. I am always surprised at how many of my Jewish friends have not been to either of those places, but in a sense I do not blame them because I think they realise how unhappy it would make them to do so. I have been four or five times over the past decade, and I always work with Jewish charities and marvel at how brave and brilliant they are. I would mention Ir Amin, B’Tselem, Machsom Watch and a number of others. Machsom Watch is comprised of 500 middle-class Jewish women who go out on rota every day to stand at the checkpoints and observe the conduct towards the humiliated and harassed Palestinians, and at night they put what they have seen on the web. What a restraint that is. A woman who took me to a checkpoint said that she was called in by one of the commanding officers. He said, “We are both Jews and we should not be arguing about this”, but then she noticed on the wall behind his head a sign that read, “Our task is to make life as impossible for the Palestinians as we can”. That about says it all.

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I turn to the circumstances prevailing in Gaza. We hear a lot about Israel getting out of Gaza and the Gazans messing up their opportunities. Well, for the majority of those concerned, getting out of Gaza was very much a utilitarian decision. Maintaining 8,000-plus settlers in Gaza was simply beyond the scope of the state of Israel and was counterproductive. Today, the situation is appalling. I will read out some statistics that I have dug out. According to UNWRA, 38% of Gazans are poor, 44% are food insecure, and 80% depend upon food aid. Gazan poverty is the world’s worst, but the only one created deliberately. The blockade has caused 17% more Gazans to be in the poorest category since 2005. More than a third of them—and more than half the young people—are unemployed. Hundreds of factories stand idle and they produce exports only at the rate of 3% of the level before the trouble. Eighty-five per cent of their fishing grounds and 35% of their agricultural land cannot be accessed because of restrictions. Eighty-five per cent of schools are run on double shifts, because others have been bombed. Ninety per cent of the water is contaminated. It is rather ironic that my noble friend talked about the prowess of Israel in water production when it has decimated the water supply in Gaza. As a result, over 50% of children have chronic diahorrea. Gideon Levy, in an article in Haaretz in July, told of the way water is used in the West Bank as a tool of colonisation. He wrote this dreadful account:

“The Civil Administration is supposed to take care of the people's needs. But it does not stop at the most despicable measure—depriving people and livestock of water in the scathing summer heat—to implement Israel’s strategic goal: to drive them from their lands and purge the valley of its non-Jewish residents”.

One needs at this point to repeat—and go on repeating—that Israel is split from top to bottom. One quarter to one-third of Israelis, by other people’s calculations, are totally opposed to what is going on in Palestine. Would that they were sitting here and speaking on the side of all, or most, of the speakers tonight. I have met some of these people, and they are brave, because they are subject to huge pressure. They are called self-hating Jews, I believe.

The noble Lord, Lord Judd, said—absolutely rightly—that our Government have employed double standards towards Israel for decades, and it has got worse, not better. Thank goodness that after this latest scandal of, I think, 3,000 new colonists in East Jerusalem cutting East Jerusalem off from the West Bank by the E1 block, the Foreign Secretary has at last come out with a firm statement. I have been in this House since 2008, and I cannot tell you the number of times that we have had statements from spokesmen from Governments of all persuasions which add up to nothing. There is never any action. My feeling is that action is not just in the interests of the Palestinians or of peace in the Middle East, let alone in the wider world, it is in the interests of Israel itself. That is what drives me on this issue and makes me unwilling to hedge about and avoid the charges of anti-Semitism which always follow plain speaking on this subject, I am afraid to say.

I feel passionately that our Government, having made a start at what I call plain speaking in relation to plain facts, should pursue that path and if necessary

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be independent of the United States, which is in a particular relationship with the huge and powerful Jewish community there, as the noble Lord, Lord King, vividly explained. We must be independent and do what we think is right for Israel, the Palestinians, the Middle East and the peace of the world. If we do that, a lot of people in Palestine will listen to us.

In 2006, I had a meeting with Dr Ismail Haniyeh, one of the hate figures, who is the leader of Hamas in Gaza. I have to say I was immensely impressed by the man. Unless I have lost all my touch for understanding the reactions of people, I was impressed. I spent an hour with him man to man. He is dying for an opening and for some encouragement because he never gets a dividend for anything Hamas does, except more colonisation and more repression. There is hope to be had if we as a country can be brave with our policy, and I hope that the Government will carry on from where they now are.

7.55 pm

Lord Williams of Baglan: My Lords, I welcome the opportunity to speak in this debate. I declare an interest as a former British official in the Middle East and as a UN Under-Secretary-General in that region. The noble Lord, Lord Palmer, referred earlier to the great Israeli diplomat Abba Eban, who once noted that the Palestinians never missed an opportunity to miss an opportunity. Now the boot is on the other foot. The Israeli Government have elevated a significant diplomatic setback in the UN—one in which it was supported by only one out of the 27 members of the EU—into a significant regional and international crisis. I fear that the hard-line stance of the current Government is resulting in a haemorrhaging of support for Israel itself. The noble Lord, Lord Palmer, referred to support for the resolution from Islamist and third world countries. The fact is that all the democracies of the world, with three exceptions—the United States, Canada and the Czech Republic—voted against Israel or abstained. That in itself is a stunning development in the history of diplomacy in the Middle East, and one that Israel needs to take careful note of. Never has its isolation been so marked.

It says a lot of Israel and of the Israeli press that these developments are followed closely and in a critical way. The newspaper Haaretz this morning is more scathing of the Israeli Government than many of the remarks made by noble Lords. Even the centrist newspaper, the Yedioth Ahronoth,is critical of Prime Minister Netanyahu’s policies and where they are leading Israel. Many noble Lords, including the noble Lord, Lord Alderdice, have referred to the regional element of peace. Where do we stand on that? Israel has peace treaties, of course, with two Arab countries: Egypt and Jordan. Those peace treaties are being sorely tested these days. It is very difficult for a democratically elected President of Egypt, Mohammed Morsi, to stand up and argue to his people that this peace treaty is right and must be adhered to. Jordan, wisely guided by King Abdullah, is also suffering great strains, and I fear there is no doubt that the majority of Jordanian public opinion is quite critical of those peace treaties.

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We have heard much about Gaza. Where have Israeli policies led there? I will tell you: next week, Khaled Meshaal, the leader of Hamas, will enter Gaza, and he will enter as a victor in the eyes of Palestinians. I do not think Abba Eban would recognise Israeli diplomacy today. Israel must rescind the actions announced by its Government in the last 48 hours: namely the declaration of more and more settlements—another 3,000 dwellings—and that planning will begin for settlement in E1, the land block between East Jerusalem and the heart of the West Bank. Everybody knows what that means. It is meant to be the end of the possibility of a Palestinian state. If that were not enough, $120 million—£75 million—of taxes owed to the Palestinian Authority have been seized by the Israeli Government in the past few days. Prime Minister Erdogan—a strong critic of Israel—will also visit Gaza soon. This is not diplomacy, and it is not diplomacy that is serving the state of Israel. Time, in my experience, is running out for a two-state settlement. We would all bitterly regret that and, most of all, it would cause great pain for the state of Israel.

8 pm

The Senior Minister of State, Department for Communities and Local Government & Foreign and Commonwealth Office (Baroness Warsi): My Lords, I am grateful for the opportunity to respond for the Government to this debate, brought by the noble Baroness, Lady Royall, about the discussions that we have had with the Palestinian leadership in light of the Palestinian resolution at the UN General Assembly last week. It is an important and timely debate and I welcome it. I know the Israeli-Palestinian conflict is a matter of great interest to the House and, as always, involves great emotion and sincerity of views on all sides. Achieving a two-state solution to the Israeli-Palestinian conflict is one of this Government’s top international priorities.

The UK has long been clear that we support a negotiated settlement, leading to a safe and secure Israel living alongside a viable and sovereign Palestinian state, based on the 1967 borders with agreed land swaps, with Jerusalem as a shared capital of both states and with a just, fair and agreed settlement for refugees. That is the only way to secure a sustainable end to the conflict, and it has wide support in this House and across the world.

However, there has been a dangerous impasse in the peace process over the past two years, as referred to by my noble friend Lord Alderdice. The pace of settlement building has increased, and we have seen new and concerning reports of this in recent days. Continued rocket attacks on Israel and continued settlement building have resulted in frustration and insecurity deepening on both sides and the parties have not been able to agree a return to talks.

We are grateful to Egypt, the United States and the UN Secretary-General for their role in bringing about a ceasefire in Gaza last month. We now need to build on this to bring about a lasting peace, including, as my noble friend Lord Phillips of Sudbury said, the opening up of the blockade in Gaza for trade as well as for aid; and, of course, also an end to the smuggling of weapons. The crisis in Gaza and tragic

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loss of Palestinian and Israeli life show why the region and the world cannot afford a vacuum in the peace process.

The frustration felt by many ordinary Palestinians about the lack of progress in the peace process is wholly understandable. We condemn illegal settlement activity in the West Bank and East Jerusalem, because it threatens the very viability of the peace process and a two-state solution that we all support. After many decades, the Palestinians still do not have the state they aspire to. That is why we have consistently asked Israel to make a more decisive offer to Palestinians than in the recent past, and have also called on Palestinians not to set preconditions for negotiations.

We agree with my noble friend Lord Palmer that the parties must get back to the negotiating table. Only today, our consul-general in Jerusalem conveyed this view to the chief Palestinian negotiator. The only way to resolve the dangerous impasse in the peace process is a rapid return to credible talks. This is the Government’s guiding principle, and it was this concern that determined the Government’s approach to the Palestinian resolution at the UN General Assembly last Thursday. Nevertheless, we respect the course of action chosen by President Abbas. There is no doubt that he is a courageous man of peace. Let me be clear: we want to see a Palestinian state and look forward to the day when its people can enjoy the same rights and dignity as those of any other nation. That is why we stress the urgency of negotiations leading to a two-state solution.

Noble Lords, including my noble friend Lord King of Bridgwater, raised questions and concerns about the assurances that the Government sought from President Abbas and the position we took in relation to the vote. The Government, I suppose, judged that these assurances would help facilitate a return to negotiations. However, our priority now is to try to restart those negotiations. We call on all parties to show the political will necessary to achieve this. We will redouble our efforts to restart the peace process and continue our strong support for the two-state solution. As I have said to this House on many occasions, and indeed only recently, 2013 will be a crucial year for the Middle East peace process. We have urged Israel to avoid reacting to the resolution in a way that undermines the peace process and a return to negotiations. The Foreign Secretary spoke to the Israeli Foreign Minister on Friday and the Israeli Defence Minister on Saturday. He made clear that we would not support a reaction that sidelined President Abbas or risked the collapse of the Palestinian Authority.

We are therefore extremely concerned by the decision of the Israeli Cabinet to approve the building of 3,000 new housing units in illegal settlements in the West Bank and East Jerusalem. This Government, along with our European partners, have consistently made clear that settlements are illegal under international law and undermine trust between the parties. If implemented, these plans would alter the situation on the ground on such a scale that it would make the two-state solution, with Jerusalem as a shared capital, increasingly difficult to achieve, if not impossible. The right reverend Prelate the Bishop of Guildford was right to raise settlements as a pivotal issue. Such plans undermine Israel’s international reputation and create

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doubts about its stated commitment to achieving peace with the Palestinians. We need urgent efforts by the parties and by the international community to achieve a return to negotiations, not actions that will make that harder.

In all the conversations that the UK has had with Palestinian negotiators, and those that the Deputy Prime Minister and the Foreign Secretary have had with President Abbas in the past week, relations have been excellent. That deep friendship will continue. The financial and political support that the UK gives, with very strong cross-party support, to the Palestinian Authority, which is among the foremost in the world, is understood well by the Palestinian Authority and will, of course, continue. We want the Palestinian Authority to succeed and we believe that President Abbas is the best interlocutor that Israel will have to bring about peace. We continue to be in regular contact with the Palestinian Authority, and officials in our consulate-general in Jerusalem had meetings in Ramallah today to reinforce the UK’s firm commitment to and support for the Palestinian Authority. My right honourable friend Mr Burt is planning, possibly this evening or tomorrow, to speak to the Palestinian chief negotiator.

We have been clear that we deplore the recent decision of the Israeli Government to build 3,000 new housing units and to unfreeze development in the E1 block, and the confiscation of this month’s clearance revenues. This threatens the viability of the two-state solution. On Saturday, the Foreign Secretary publicly called on the Israeli Government to reverse this decision. In common with steps taken by other European partners, including France, the Israeli ambassador to London was formally summoned to the Foreign Office this morning by my right honourable friend the Minister for the Middle East, who set out the depth of the UK’s concerns about the recent Israeli decision.

The noble Baroness, Lady Royall, asked what representations had been made to Israel on the confiscation of customs revenues. The Minister for the Middle East conveyed our serious concerns about this decision to the Israeli ambassador this morning. The national security adviser, Sir Kim Darroch, reinforced this concern to his Israeli counterpart when they spoke this afternoon. The noble Baroness, Lady Royall, also raised the question of what consultations we have had with the noble Baroness, Lady Ashton. We have had a number of consultations with key international partners since Friday, including with the office of the noble Baroness, Lady Ashton, and with the US Administration. We note the strong statements of the noble Baroness, Lady Ashton, and Secretary of State Clinton on these issues.

My noble friend Lord Alderdice raised important points based on greater experience. I am grateful for his contribution and also for the tone of his contribution. It is of course right that a regional initiative is important. Egypt’s success in relation to the Gaza ceasefire is just one great example of this, but I am sure my noble friend will agree with me that the US must now step up to the mark, as real progress will be made only with its positive involvement.

The noble Lord, Lord Janner, is right when he says that the future has to be agreed through diplomacy, not rockets. The recent conflict in Gaza left 160

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Palestinians and six Israelis dead. That is not the way forward. The noble Lord, Lord Judd, raised important issues, noting that in order to lay the foundations for future agreement, we must understand history. I agree that an even-handedness in this matter is as much in the interests of Israel as of the Palestinian people. The noble Lord, Lord Williams of Baglan, also raised the issue of settlements. I hope he feels that I have dealt with that already.

Palestine is now a non-member observer state at the United Nations but, sadly, the situation on the ground remains the same. The only way to give the Palestinian people the state they deserve, and the Israeli people the security they are entitled to, is through a negotiated two-state solution. That requires both parties to return to negotiations, Israel to stop illegal settlement building and Palestinian factions to reconcile with each other.

The past month has highlighted the fragility of the situation in the Middle East and the coming year will prove crucial if peace is to be achieved. Urgency is required to ensure that we grasp the opportunities that will be presented. We encourage the US, with the strong and active support of the UK, the EU and the international community, to show decisive leadership and do all it can in the coming weeks and months to drive the process forward.

If progress on negotiations is not made next year, the two-state solution could become impossible to achieve. That is why the Foreign Secretary has said to the US Secretary of State, Hillary Clinton, that such an effort would need to be more intense than anything seen since the Oslo peace accords. We are ready to throw our support behind this to find a solution to the conflict before it is too late.

Legal Profession: Regulation

Question for Short Debate

8.10 pm

Tabled By Baroness Deech

To ask Her Majesty’s Government what assessment they have made of the efficacy of the regulation of the legal profession.

Baroness Deech: My Lords, I declare an interest as the chairman of the Bar Standards Board and as a non-practising barrister. I have regulated several enterprises in my time, but I have been fortunate in only ever regulating those which I am convinced do good and with which I am familiar and well briefed. This House spent many hours last year debating the merits of and need for public bodies, and the principles aired then are ones that we need to be reminded of tonight.

The background to regulation of the legal profession is simple to grasp, and it is quite different today from the situation that prevailed when the governing statute, the Legal Services Act 2007, was conceived and passed. Simply, it is the lack of legal aid and affordability. That is no problem for those who go to the thriving commercial side of the Bar, but the average wage earner often finds the expense of legal advice beyond his means, in part because of the built-in cost of regulation. The effect on the profession is dire too, for

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the very large numbers of the Bar who do, arguably, the most socially valuable work, in criminal and family law, are seriously affected, because payment for regulation has to come out of their own pockets. This works against mobility and diversity, for the altruistic young people who qualify and want to come to the Bar cannot earn the modest living they once relied on without the legally aided work, at the very time when their higher education debts have peaked.

The Legal Services Act, which governs my work, is grounded in the 2004 report by Sir David Clementi on the regulatory framework of legal services. He was concerned with the then over-complex existing regulatory frameworks and with complaints handling, although, to be fair, that was more relevant to the solicitors’ branch than the Bar. He was trying to reconcile liberalisation, allowing competition and access to flourish, with protecting the public, with special focus on complaints handling. His report led to the Legal Services Act 2007.

Consumerism was the other motivating factor behind the Act, but that policy was formulated in 2000, in an entirely different economic climate, following the Office of Fair Trading report about competition in the professions. This was all before the crash of 2007-08 in the financial world and its dreadful results. That demonstrated the failure of financial regulation, which, with hindsight, might have affected the principles behind the Legal Services Act. It was once thought that the division between clearing banks and merchant banks should go, and that there should be a free market of unfettered competition and deregulation. I am no economist but I would not be alone in pointing out that the meltdown and bank collapses resulted, and the Financial Services Authority seemed to have no power to prevent any of this or stop any innocents from losing. Indeed, that super-regulator is about to be dismantled. Legal regulation was developed without regard to this history and its risks have yet to play out.

Under the 2007 Act, the profession is overseen by the Legal Services Board. Its powers are devolved to some extent to the front-line regulators—for these purposes, the Bar Council and the Law Society, which have separated out their regulatory and representative functions. Therefore, the Bar Council represents barristers and the Bar Standards Board regulates them; the Law Society represents solicitors and the Solicitors Regulation Authority regulates them—not to mention six other regulators. For the purposes of this debate, I will concentrate on the Bar and the solicitors, of whom there are 10 times as many, and I am married to one of them.

Proper regulation, in the public interest, is absolutely vital but it needs to be balanced against cost and existing resources, and performed efficiently. It does not take much to see that, rather than sorting out the maze of regulation, the statute adds to it; there may be over-regulation, duplication of regulation and competitive regulation, none of it cost-capped. The cost of the Legal Services Board and its demands are serious issues, for the practitioners have to fund it, as well as the other projects it has required—quality assessment of advocacy, an education review, diversity data collection and the Office for Legal Complaints. More than that, it is arguable that the Bar was caught up in the slipstream of the criticisms that were levelled at the

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handling of complaints by solicitors, and the heavy structure of the 2007 Act is not suited to as small a profession as the Bar.

When the Legal Services Bill was introduced in 2006, the regulatory impact assessment calculated the annual running costs of the Legal Services Board, which is the super-regulator overseeing the specialised ones, at £3.6 million. However, the total borne by the entire legal profession up to now is £19.5 million, with another £50 million for the Office for Legal Complaints. The cost falls on clients and, in the case of legally aided clients, on practitioners. That is due to duplication of work through micro-management of regulators and the pursuit of objectives more akin to a market regulator than an oversight public interest regulator, as was mandated by Parliament.

I echo the fears of Sir Sydney Kentridge when regulation of the legal profession was first advanced a few years ago. He feared an increase of power of the Government to control the legal profession through a government-appointed body, but he was confident that the Lord Chancellor would ensure that the Bar was protected. Sadly, as I have learnt at international conferences, the outside world sees the independence of our legal profession as diminished by regulation.

The 2007 Act laid down eight regulatory objectives in no particular order. Some conflict with others in practice. Therefore, a margin of appreciation clearly must be left to front-line regulators to decide what steps to take. It is not clear from the statute whose view would prevail in case of disagreement between the Legal Services Board and the front-line regulators. Nevertheless, history has shown that one objective, that of promoting the interests of consumers, has been elevated above the others by the super-regulator, and in so doing it sees it as its task to “direct” rather than “assist” —the word chosen by Parliament—the front-line regulators.

Excessive focus on the consumer interest may be to the detriment of the professional interests and standards upheld by the lawyers. Commercialism is not everything, although one wants legal advice to be available and affordable. Certain services, such as education, health and the law, are beyond market value. The public interest must prevail. It does not seem to me that the public will be well served if there is authorisation for a new category of partly qualified or underqualified providers of legal services who offer only one service—for example, will writing, which cannot really be confined to a small area.

Too many new projects are being imposed by the super-regulator on the front-line regulators without due regard to cost, need and effort. For example, outcomes-focused regulation does not work well for the rules of conduct of the Bar, because court litigation is a process-driven system, where the rules are not merely means to an end but an end in themselves and intrinsic to the rule of law itself.

Let us take referral fees. They are seen by the entire Bar as unethical, restricting competition between lawyers and denying the client freedom of choice. They are likely to be illegal under the Bribery Act 2010, but the front-line regulators are being told to retain them except where specifically banned by law, in the face of evidence that they are a bad thing.

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Another example is that the members of the Bar have been told that, when they first meet a criminal client in the cell, they must give that client on a piece of paper directions as to how to complain. There could not be a worse moment at which to do it. Now there is required detailed collection of barristers’ equality and diversity data, which go beyond the Government’s recommended approach, in that they require data on sexual orientation and socio-economic status. They are to be collected chambers by chambers, yet many chambers have fewer than 10 members, which makes collection of such data very sensitive, because anonymity may easily be breached. The Bar’s preference for aggregate collection of such data across the profession was rejected.

The Bar Standards Board does not dispute the need for proper regulation, but it should be proportionate, affordable and effective. We were disappointed that the Ministry of Justice’s triennial review of the Legal Services Board did not address those concerns directly. The opportunity will present itself again in the quinquennial review of the 2007 Act.

The noble Lord, Lord Carlile, who cannot be in his place this evening, has said, in support of what I am saying, that the regulation of the legal profession is cluttered and bureaucratic. It may not have gained the confidence of the profession or the public.

At this stage in the implementation of the Act and the introduction of alternative business structures, there remains a role for the Legal Services Board, but not many more years should pass without an overhaul of the complications introduced by the Act in establishing a super-regulator. I hope that the Lord Chancellor and the Ministry of Justice will start a discussion with the profession and identify a simpler, cheaper and more balanced future.

8.21 pm

Lord Faulks: My Lords, I begin by declaring an interest. I am a practising barrister. I was a head of chambers for nearly a decade until relatively recently and I am a former chairman of the Professional Negligence Bar Association.

I shall make a few observations about the position of the Bar. My noble friends Lord Gold and Lord Phillips of Sudbury will no doubt speak about the solicitors’ profession. When I started to practise, the Bar was lightly regulated, the profession was much smaller, chambers were much smaller, circuits had more power and influence, and most senior barristers proceeded to some form of judicial post. The standard of ethics was extremely high, but there were undoubtedly some restrictive practices which needed to change. Those practices, together with the considerable increase in the size of the profession and the way it functioned, called for examination.

Following the report of Sir David Clementi, the Bar Council carried out his central recommendation: that there should be a split between the regulatory and the representative elements of the Bar Council’s work. It therefore established the Bar Standards Board. The members had extensive experience of regulation and corporate governance and were appointed on Nolan principles.

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It would be inaccurate to say that the Bar, a still small and independent profession, universally welcomed the arrival of the board but, since it has been set up, there has been a growing respect for what it does. There have inevitably been increasing demands on chambers in terms of record-keeping, compliance with regulation and a variety of measures that the board has imposed on the profession to secure high standards and ensure that the Bar functions in a way that reflects the public interest.

The key to the respect that the BSB commands is the evidence-based approach adopted by the board and the sense among barristers that it has taken the time and trouble to understand the Bar and the way it practises, both its weaknesses and its strengths. The need for a super-regulator, or oversight regulator, to oversee the approved regulators such as the BSB has not been seen by the profession to have any obvious justification—to put it mildly—particularly when it seems to involve sets of chambers duplicating many of the obligations placed on them by the BSB and increasing still further the cost of compliance.

What is the proper role of the Legal Services Board? As the Legal Services Bill was going through Parliament, a number of parliamentarians expressed the fear that the LSB might be heavy-handed and would not allow approved bodies such as the BSB, once they were operating effectively, to get on with the job. Reassurance was provided by the then Government. For example, on 13 June 2007, Bridget Prentice MP, the Parliamentary Under-Secretary of State in the Department for Constitutional Affairs, said:

“It is important that the oversight regulator does not micro-manage and second guess the actions of the approved regulators, as Members on both sides of the Committee will agree”.—[Official Report, Commons, Legal Services Bill (Lords) Committee, 13/06/07; col. 95.]

This is a reference to the work of the Joint Committee on the Draft Legal Services Bill, to which Sir David Clementi had said in evidence that there should be “minimal interference” by the LSB in the work of the approved regulators.

I have had the opportunity of reading the Bar Council’s response to the triennial review of the LSB by the Ministry of Justice, together with the LSB’s response. To the disinterested observer, I recommend reading these two documents. The arguments of the Bar Standards Board are compelling. Those of the LSB are rich with regulatory language, not easily understood by the general reader, and include a great deal of self-justification. They also indicate a desire to play an increasing role in the regulation of the legal profession. The response concludes with an observation about a review of the 2007 Act:

“Any significant change to the current settlement in advance of such a review will divert effort unnecessarily from the current challenging delivery agenda”.

This does not sound very much like what Parliament had in mind for the Legal Services Board.

I will give the House an example of where the LSB clearly wishes to have a significant involvement in the way the legal profession functions, which is in relation to legal education. The chair of the LSB

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observed in his Lord Upjohn Lecture in 2010 that the current framework for legal education and training was,

“simply not fit for purpose”.

In his own 2012 Lord Upjohn Lecture, Lord Neuberger, the president of the Supreme Court, made this observation about David Edmonds, the chairman of the LSB, and the Legal Education and Training Review:

“I cannot share the view which David Edmonds was reported in the Guardianas expressing in March this year, namely that he would be ‘extremely disappointed’ if the LETR only made minor recommendations. That suggests a conclusion that major reform is both necessary and proportionate, reached in the absence of any evidence and analysis. But surely we should wait for the evidence, the analysis of that evidence, and the conclusions drawn from that analysis before we start talking of disappointment or the nature of the appropriate recommendations. We should all be surely approaching the Review and its outcome with an open mind”.

No doubt the observations of the chairman would be said to be consistent with one of his goals in the LSB’s draft strategic plan for 2012 to 2015, which was,

“to reform and modernise the legal services market-place in the interests of consumers, enhancing quality, ensuring value for money and improving access to justice across England and Wales”.

The LSB clearly has very significant regulatory ambitions.

Who pays for the increasing regulation? The cost falls on practitioners and very harshly on those who are starting and who depend on the publicly funded fees which are steadily reducing in their true value. Smallish sets of chambers with a high BME quotient are particularly hard hit. For those not dependent on publicly funded work, the cost of regulation—much of which, in my view, is unnecessary—will ultimately fall upon the consumer of legal services, who will have to pay more for the increasing infrastructure that is necessary in chambers in order to comply with the burden of regulation.

Barristers are, frankly, bewildered by some of the requirements imposed by the LSB. The inept requirement by the LSB that barristers should inform their lay clients at the point of first instruction of their right to make a complaint to the chambers and, as necessary, to the legal ombudsman, shows very little understanding of the way barristers actually practise and an insensitivity of the circumstances in which a client sees a barrister. Similarly, the requirement by the LSB that quality and assurance should extend to practitioners’ advisory work reveals a complete ignorance of the way in which the profession works—not to say a failure to grasp fundamental principles of law in relation to the privilege which attaches to instructions given to barristers. These examples and many more illustrate the perils of having a non-expert lay regulator attempting to devise rules of conduct for practice by members of the legal profession.

Barristers understand the need for regulation and for public confidence in the legal system. However, it should not be forgotten that the legal profession is held in high regard throughout the world, as is our system of justice, and results in considerable benefit to the economy of this country. We should take considerable care before ripping up the model.

I am sure that the Minister will accept, as do the Government, that regulation needs justification and that our economy generally has been overburdened by

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unnecessary and inappropriately onerous regulation. I urge the Minister to support post-legislative scrutiny of the effectiveness of the Legal Services Act, particularly the scope of the LSB’s activity.

I congratulate the noble Baroness, Lady Deech, for bringing forward this important question to your Lordships’ House. I applaud her contribution to the raising of standards at the Bar and endorse all that she has said so ably in today’s debate.

8.30 pm

Lord Phillips of Sudbury: My Lords, I, too, thank the noble Baroness, Lady Deech, for bringing this subject before the House. I confess that I received her e-mail warning us of all this only this morning, so my contribution may be lacking in coherence, but I will make a few points if I may. I started full-time in a solicitors’ office—admittedly, as an office boy—55 years ago, and have seen an astonishing transformation over that time in the regulation and, I believe, the ethos of what is still called a profession. When I started there was a maximum of 20 partners; you could have only partnerships, not limited liability; there was no advertising and no conditional fee arrangements; referral fees were not permitted; and, above all, there were no such things as “alternative business structures”, that charmingly denominated abortion that we now have among us.

Sadly, I must be honest and say that I do not actually think that solicitors are any longer members of a profession. I think that we are just another business. Thank the Lord, integrity is still largely to be found within the solicitors’ branch of the profession, but I do not see it long maintaining itself because the structures within which we now function have become so commercialised and driven by bottom-line considerations that it is unreasonable to expect integrity to survive organically—in rather the same way, I am afraid, as the City, little by little, has lost its values base. I agree with what the noble Baroness said about the big bang and its consequences

I feel that we are going down a blind alley in thinking that more and better regulation can maintain the essential integrity without which we are no longer officers of the Supreme Court and handmaids to justice but something a great deal less and, in some ways, quite threatening. I say that with great reluctance but cannot avoid it. I was the only solicitor member of the committee set up under Sir Sydney Kentridge, and he had a very lively belief in the ethos of the profession—a set of values, if you like, autonomous to each practitioner, without which the whole structure could not survive.

The truth now is that we are deep in regulation—I would say, as have others, overregulation or inappropriate regulation. I looked at Halsbury’s Laws of England this morning and found to my amazement that there are two volumes on the professional regulation of lawyers—1,196 pages of stuff about it. When I started, I doubt that there were 60 such pages. The life of the lawyer today—I can speak only of the solicitors’ profession—is unbelievably bureaucratic. There is somehow a belief that if you are forced to write a six-page letter to a client before you start work, that will somehow improve the work, or that some of the forest of internal bureaucracy that now prevails in big

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firms can maintain those essential elements without which there can be nothing.

I look to the regulatory objectives of the 2007 Act. I may say that I was one of the very few Members of the House of Lords—in fact, I may have been the only one—who was flat-out opposed to the part of the 2007 Act that set up the alternative business structure. But as has already been remarked, the eight regulatory objectives are not entirely internally consistent. When you think that the eighth of them is,

“promoting and maintaining adherence to the professional principles”,

of which there are five, it all adds up to a not entirely clear set of guidelines for the young person entering the profession. Above all, integrity should surely trump everything. I do not think the word appears in the eight regulatory objectives.

I leave my few remarks at that. I warn against the bureaucratisation that attempts to set the values for the practitioners. Up to a point, of course you have to have a complaints mechanism; of course you have to have somebody who can strike down the few bad apples and maintain that integrity. But I believe, as had been said by the two previous speakers, that we are not at the point where we are doing the regulatory process the best we can. In fact, going back to the drawing board—as I think was the phrase of the noble Lord, Lord Faulks—might well be what is needed.

I have not embarked on the alternative business structure, except to say that if anybody thinks that you can have a law firm 70% or 80% owned by whoever the hell you like and that that is not going to impact directly on the ethos of that enterprise, they are living in cloud-cuckoo-land. There are 120-plus applications now for ABS status and it is already observable that these big combines are going to be driven first, secondly, and thirdly by profit, profit, profit. It is all about the bottom line, just as in the City. Everything else can go hang. The notion of informal pro bono work is, I am afraid, inconsistent with the values that will bring into existence the vast majority of these alternative business structures. I would like a re-examination of them as soon as is feasibly possible, because they are a real nail in the coffin of professionalism.

8.37 pm

Lord Gold: My Lords, I start by thanking the noble Baroness, Lady Deech, for bringing this debate forward this evening. Perhaps like the noble Lord, Lord Phillips, I was somewhat sceptical of the Legal Services Act and what was intended by it, but I was not here then. Maybe I would have joined in voting against it. But we are where we are, and we must have a properly regulated legal profession that ensures that all providers of legal services meet high standards of competence and behaviour. This is even more important now as the first alternative business structures start providing legal services. I share the concerns of the noble Lord, Lord Phillips, about where that takes us, but we will see.

The present system reflects the proposals in Sir David Clementi’s 2004 report, as we have heard from earlier speakers, for which there was general parliamentary support on all Benches as well as support from both the Law Society and the Bar. High on Clementi’s recommendations was the separation of representative and regulatory functions.

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The Legal Services Board was created to provide oversight of a variety of different regulators to ensure that the right regulatory objectives are achieved and to secure some independence from the Government. The current regulatory framework has been in place only since 1 January 2010, when the Legal Services Board took on the majority of its powers under the Legal Services Act. In a review published in July this year, the Ministry of Justice was supportive. It concluded that the LSB should continue to deliver its functions in its present form. Recommendations for some improvement to its corporate governance were made but, by and large, it was to carry on operating as before.

Despite the endorsement from the Ministry of Justice, there has been some criticism of the LSB. We heard some this evening. The noble Baroness, Lady Deech, identifies criticisms made by the Bar Standards Board, notably that there is overregulation and duplication, leading, among other things, to unnecessary cost which inevitably is being picked up by the consumer. While generally supportive, the Law Society, representing 120,000 solicitors in the UK, is also critical. It believes that the LSB has not got the balance right and that the objective to promote competition in the provision of services is given greater emphasis than improving access to justice, encouraging an independent, strong, diverse and effective legal profession and promoting and maintaining adherence to the professional principles.

The regulatory arm of the Law Society, the Solicitors Regulation Authority is a bit more supportive, but also believes that the balance is not quite right at the moment. The SRA approves of the LSB’s emphasis on putting the consumer and public interest at the heart of regulation and its role in the appropriate co-ordination of standard setting across the various front-line regulators. The SRA also considers that the Legal Services Board has made significant progress in achieving its objectives, including making the market more diverse, as seen in the licensing of ABSs, and developing a regulatory regime that is both independent and transparent. However, the SRA believes that the LSB now needs to work closely with regulators to develop a common understanding of its role. It considers that the LSB must focus on properly developing its oversight role and, in doing so, reduce its approval, enforcement and investigatory functions. However, the SRB acknowledges that there have been improvements.

The main thrust of the complaint against the LSB is whether it is truly performing the role of oversight regulator, which was what was intended, or whether, in the words of the Bar Council, there has been “mission creep”, with the LSB now duplicating and overlapping the work of the front-line regulator, micro-managing the activities of those regulators it is meant to oversee. Front-line regulators, such as the SRA, are much more in touch with the profession, so why should we defer to something much more remote, where I do not believe that there are any legal practitioners involved? Critics claim that this duplication and the LSB’s micro-management have greatly increased the cost burden. It seems, from other speeches this evening, that that is indeed supported. Although it might be said that the fact that there is some tension between the LSB and the regulators over which it has oversight, or at least

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some of them, is not a bad thing—it might keep both sides on their toes—the extent of the serious criticisms that are being made suggests to me that we really need to look again at the balance.

I have spent the past two years immersed in the world of corporate governance. This has demonstrated to me that finding the right balance is key. While businesses must adopt a proper governance regime, it is essential that governance does not take over and damage the very business that the organisation is promoting. So those responsible for regulation must be practical and sensible in their outlook. Regulation for regulation’s sake cannot be right. Any regulation that is put in place must be appropriate and proportionate to achieve the required result. Its purpose must be understood and supported by those being regulated.

I am also sure that, if at all possible, finding the right balance should be achieved through greater dialogue and perhaps compromise between the relevant parties. Those concerned may need to demonstrate that they understand the issues raised by the other parties and are willing to be flexible. In the perfect world, by working in partnership and accepting that each side may be making valid points, the LSB and the regulators will be better able to deliver excellence in the regulation of legal services. This is far better than seeking to impose a solution on the regulators or the LSB. However, I understand there has been considerable dialogue between the LSB and the regulators and that little progress has been achieved. That is unfortunate and harmful to the legal profession and the administration of justice.

Under the circumstances something more is needed; it has been suggested that even late on there should be post-legislative scrutiny of the effectiveness of the Legal Services Act in order to test whether the original objectives have been achieved. I suggest to the Minister that this is something that should now be looked at seriously. The Bar Council wants such a review, and I do not think that the solicitors’ profession would have much difficulty in supporting it. Despite this, I think that the LSB has a continuing role, particularly as we have alternative business structures coming into place. Until we see where that actually takes us and how these new bodies operate, the LSB should remain, but I think the sort of review I have mentioned is necessary.

8.46 pm

Lord Mackay of Clashfern: My Lords, it seems a long time since Burns Night 1989 when I introduced Green Papers about the reform or control of the legal profession. Your Lordships who are old enough will remember that these Green Papers provoked a certain ripple of interest from the judiciary and others. There have been great changes since then. In formulating the Green Papers we were principally, although not entirely, dealing with what looked like anticompetitive practices in the legal profession. To what extent a particular practice is anticompetitive is quite a difficult question. For example, it was thought that preventing the legal profession advertising was anticompetitive; I am not sure that the legal profession is better today with the kinds of advertisements you see on the television and in the newspapers. What one characterises as

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anticompetitive may, in fact, be something to do with the quality, independence and integrity of practitioners. If I am a reasonable member of a legal profession, I surely do not need to make my way forward by criticising my fellow practitioners. Relationships created in the course of professional work should, in my view, be the principal recommendation for a professional person.

Matters have since moved quite a distance. In my final proposals, which went through as an Act of Parliament, judges were given an important role in the control of the legal profession, which worked pretty well for a time. Gradually, the influence of judges was reduced until it disappeared altogether from the formal aspects of the regulation and eventually new standards were set up. I believe that the late Lord Nolan was the first to point out the need for a division in the Bar between its regulatory and representative functions, particularly in relation to the charges levied by the Bar Council for being a member of the Bar. If it was regulatory, it could be compulsory, whereas if it was representative, it should be voluntary. “No taxation without representation” might be an adapted expression for what he said.

It is also important to remember education in this connection. It was important in my judgment, and I remain of the view that it was probably correct, that a reasonably efficient system of education was required to maintain the professional quality of the Bar and of the solicitors’ profession.

It seemed to me, and I still take this view, that the different branches of the legal profession have different challenges to face. Therefore, I am glad that the Bar Standards Board, the Solicitors Regulation Authority and the other regulators which exist now in the legal profession have independent existence. I remember discussing the need for differences with Sir David Clementi. I think he did not fully agree with my point of view, which was why he suggested this overarching supervisory body for the legal profession as a whole. He thought that the legal profession should be regarded as a whole, and I could see the force of that. I also think that overspecialisation in the legal profession is detrimental to its success as a proper organ in the general affairs of our country.

We must recognise that it is important that the legal profession should be independent. In recent days, we have heard a little about regulation in relation to another independent part of our economy with a fairly heated argument on one side and on the other. That was part of the burden of the debate that we had on the Green Papers on that marvellous Friday, which I certainly remember with great—what should I say?—anxiety as to whether I was doing the right thing.

As I have said, education is important. In this connection, I would be glad if the Minister would comment on a report that I have recently read that the College of Law has been transformed, no doubt with the authority of the Privy Council, into the University of Law. I always thought that a university was supposed to be an institution which had perhaps not absolute universality but at least covered a few disciplines, including medicine and the like. But the University of Law seems to have only one discipline as its subject matter.

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Lord Phillips of Sudbury: Is it not also true that the university which emerged from the College of Law is a profit-making entity? I rather think that it is.

Lord Mackay of Clashfern: I am just about to come to that point. I understood that the something or other—I am not sure exactly what—of the College of Law has been sold to a commercial organisation, which I assume has a profit motive in it. I do not think that it is a charity. However, the university would be a charity, at least under the ordinary definition of charity which prevails as an institution for the advancement of education. I would be glad to know a little about the Government’s policy in relation to having the legal profession taught, and a university financed, by a profit-making organisation. I am not against profit for profit’s sake at all but, hitherto, universities have not been regarded primarily as institutions set up for profit, except for the profit of those who profit from them.

The noble Baroness, Lady Deech, has led the Bar Standards Board with tremendous distinction. I sensed a certain amount of frustration in her remarks this evening about the way in which really efficient standard-setting for the Bar can be damaged by unnecessary and sometimes overcomplicated interventions by those who do not quite share the same objectives as the Bar Standards Board. I feel that the same may be somewhat true in the solicitors’ branch of the profession.

I hope that the Government will take very seriously the suggestion that this whole area should be subject to post-legislative scrutiny. The Joint Committees of this House and the other place have shown themselves to be very valuable in scrutiny of legislation. Post-legislative scrutiny of this legislation, which is so fundamental to the success of our free legal profession, is now due.

8.55 pm

Lord Goldsmith: My Lords, I shall speak briefly in the gap and have alerted both Front Benches to this. It is a pleasure to speak after the noble and learned Lord, Lord Mackay of Clashfern, because it was probably as a result of the innovations and reforms that he has referred to that I first became involved in questions relating to the regulation of the legal profession. I have now been involved in this for more than 20 years, both nationally and internationally. I was chairman of the Bar during the first year that it faced competition from solicitors in terms of rights of audience and when it for the first time had to succeed on the basis of its merits and not on the basis of restrictive practices.

I want to spend two minutes underlining a very important point raised by the noble Baroness, Lady Deech. It is not the question of whether there should be regulation for the legal professions; of course there should. It is not the question of whether the regulation should be for the public interest; yes, it should. It is not the question of whether regulation should be carried out purely by lawyers—the body which the noble Baroness, Lady Deech, heads has a majority of non-lawyers on it. Those are not the issues. Rather, the issue is: what is it that the Legal Services Board is doing? This came about when I was fulfilling a different role as a member of the Government who introduced the Legal Services Act. I did not have direct responsibility

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for that; that was the Lord Chancellor. However, obviously I knew well what was going on and expressed my views at the time. We tried to make clear to both sides of the legal profession, and indeed to the other legal bodies, that the Legal Services Board was not going to be an alternative regulator. It was to be an oversight regulator which had to be there as a backstop in case the regulators themselves—the Law Society, the Bar Council and the two bodies that they set up—were not doing their job.

I am still involved in the regulation of the legal profession as a bencher at Gray’s Inn and a member of its management committee—a constituent part of the way in which the profession operates. I have a growing concern about whether the Legal Services Board is micromanaging and suffering from mission creep, which is almost inevitable whenever a body is set up. I know, because I have seen the operation, that the noble Baroness is not a pushover as far as the Bar is concerned; absolutely not. I have seen her berate—very nicely but still enormously effectively—Lord Justices of Appeal who were quivering, not realising what they had done wrong. When she does that it is very good for the profession and for the public. What is not needed alongside that is a body which thinks that it has the same responsibility—it is not there in the background but is forward. The Bar Council said in a briefing that on the important public issue of the extension of direct access the Legal Services Board sent 14 points that it wanted to see addressed in any submission on this question. If that was the case, it was over egging the role.

I have a single question and a single proposition for the Minister. Will he say, having heard from the noble Baroness, that the Government will take on the question of having a proper review of what the Legal Services Board is doing? Many people with experience, from inside and outside the profession, will be able to assist in relation to that. It is important. As the noble and learned Lord, Lord Mackay, said, what matters at the end of the day is the independence of the legal profession. That needs to be safeguarded as well as the public interest, efficiency and the other things that noble Lords have referred to.