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Column 680foreclosed in advance the elderflower champagne argument and, ultimately, would have saved both sides some money.
It is also interesting that the Bill specifically provides for the introduction of collective marks. That seems a useful way of enabling smaller businesses to group together and secure the brand identity of products in the market which they could not afford to secure individually. That is a welcome and positive development, as is the recognition that where small businesses have been trading under a name locally, they will continue to be allowed to use that name even if a similar name has been registered nationally.
Once again, that arises out of the Chelsea Girl and Chelsea Man case. Chelsea Girl tried to prevent a small shop from operating under the Chelsea Man image ; Chelsea Girl tried to shut it down. That was a case in which a big operator managed to invest in registering its brand and tried to shut down someone who had been in business long before the big operator. I am glad that the Bill recognises that situation and seeks to protect small local businesses by allowing them to operate within a locality, given that they have already established their reputation even though they have not registered the brand name.
The provisions relating to infringement and the remedies for infringement clearly recognise the way in which things have moved since 1938. Big business needs to take on board the potential disadvantages of being so successful in its branding that a brand becomes generic, and it can no longer protect it. The question whether the Hoover company has necessarily lost by that is debatable. I think that Hoover lost more as a result of the way in which it promoted the brand, rather than the quality of the brand itself. One issue that arises is that exclusive licensees will be able to bring infringement proceedings in their own name without having to wait two months to see whether the proprietor commences proceedings. It has been argued that the Bill says that non-exclusive licensees must still wait two months. The simple question is : why is there a distinction ?
In the context of a major national brand, two months is probably not a long time. However, for a small retailer, two months may be the difference between being profitable and being forced into loss. It is not clear why that time delay is still allowed in the Bill. It has been suggested that, at the very least, there should be a provision to allow an interlocutory injunction while a case is pending. That seems to me to be in the interest of small business rather than big business.
In general terms, the Bill clearly has support on both sides of the House, and it meets needs that we must address under international and national obligations in an area of law which certainly needs updating. There has been some comment on the delay, and some concerns have been expressed about the role of the Patent Office. The Minister must take on board the fact that, in updating and changing the intellectual property law, we should be mindful of what is going on outside the United Kingdom.
We should not do anything to prejudice either the interests of our businesses or our ability to ensure that British practice becomes part of the shaping of international practices. Rather than making any ideological attack on the Minister about the future of the Patent Office, I would ask him and the Government to be mindful of those considerations.
Column 681I am sure that he will recognise that we have a reputation in this area, not least because we have some world brand leaders and because we have been succesful at brand marketing. We must also ensure that changes and updates that may be necessary advance our interest, and do not set it back. The important thing is trade marks, patenting and intellectual property as it matters to UK business, and ideology should not get in the way of it. I hope that the Minister will take on board the fact that that is the balance that matters.
Mr. John Whittingdale (Colchester, South and Maldon) : As has been said, this is largely a technical Bill and, despite the valiant efforts of the hon. Member for Edinburgh, South (Mr. Griffiths), I suspect that it is unlikely to generate too much party political controversy. I therefore do not wish to detain the House for too long.
Nevertheless, it is an important Bill and one for which British business has been calling for a long time. The central concern of the Bill is protection of intellectual property, and it is closely related to the laws governing counterfeiting and piracy which are increasing dramatically. One of the helpful results of the Bill will be that it will provide a clearer and less ambiguous definition of what is a trade mark.
Some have tried to argue that trade marks are an attempt by manufacturers to inhibit competition or to create a type of monopoly. I do not accept that argument. I believe strongly that trade marks are in the interests of consumers. They are an essential means of identifying a manufacturer's product and they are frequently symbols which are guarantees of quality. They are also labels of origin which are an acceptance by manufacturers of responsibility for the product which bears them.
The law rightly confers on the owners of trade marks protection to prevent them from being abused by other manufacturers. Those who attempt to abuse are trying to con the public, pass off goods as being of a different origin and defraud manufacturers of the genuine article. Manufacturers, it has been said, frequently invest millions of pounds in the advertising and promotion of their products. They are also entitled to protection to ensure that that investment is not stolen by companies that pass off the goods as being of a different origin.
I therefore strongly welcome the provisions of the Bill. A harmonisation of the laws on trade marks across the European Community will be of great benefit to British business. I have not always been a totally enthusiastic supporter of all matters related to integration across Europe, but, in this instance, I firmly believe in the single market. Like my hon. Friends, I have taken pleasure in pointing out the excellent record of the Government in implementing single market measures. This particular one has been a glaring omission and I am therefore pleased that we can now add it to our record. It is high time that we did so.
The measures to implement the Madrid agreement are of equal importance. The protection of trade marks and copyrights cannot be achieved on a national, or even a Community, basis alone. They must be tackled internationally and that is one of the reasons why the general agreement on tariffs and trade was so important.
I want to say a few words on piracy and counterfeiting which have been mentioned in the debate. There is no
Column 682doubt that piracy is costing industry millions of pounds every year. The video industry has estimated that it loses £150 million each year through counterfeiting. Gucci has said that it costs the watch industry £450 million each year, and makers of perfume, jeans, computer software and sports equipment are all victims of counterfeiting.
Manufacturers lose sales and the consumer loses any form of protection given to him by law. Usually, the quality of counterfeit goods is poor and the product frequently is not even safe. Recently in Essex, trading standards officers discovered that even the spare parts of cars were being sold under counterfeit brand names. Those spare parts were not just of poor quality, but were unsafe and certainly would have led to serious accidents if they had been used. Every-day products are sold in car boot sales and by street traders in Oxford street and elsewhere which purport to be brand- named goods. In many cases, the consumers who buy them know that they are not the genuine article since they are paying sometimes one tenth of the price. Nevertheless, manufacturers are still losing sales as a result and their products are being devalued.
The Bill will help improve the situation. It will extend the definition of trade marks and make it easier to register them. The provision to prevent traders selling so-called brand copies is particularly welcome. Traders have attempted to get around the existing law by placing disclaimers on the goods and by acknowledging that they are copies. That has been become a commonplace practice at car boot sales where trading standards officers have been powerless to act. I welcome the fact that the Bill closes that loophole. However, I am disappointed that the Bill does not go further. In particular, it will not benefit copyright goods such as compact discs and music cassettes. Traders simply delete the trade mark since the product is sold, not on the basis of that trade mark, but on the basis of the artwork, packaging and content. I know that my hon. Friend is aware of the importance of the music business to this country. It is one of our most successful industries, contributing some £800 million in exports and invisible earnings. Indeed, it is hard to think of any other field in which British artists and performers have such a commanding lead.
Yet the music industry is seriously threatened by piracy, with thousands of counterfeit CDs pouring out of China and elsewhere. It is estimated that 14 per cent. of music sales in Europe are now pirate recordings, rising to 30 per cent. in Asia and the middle east and to more than 50 per cent. in Latin America. That is not only depriving British record companies of potential exports worth about £160 million, but it is affecting the domestic market.
By simply removing the company trade mark--while otherwise copying every aspect of the packaging--traders will be able to sell goods without fear of seizure by trading standards officers. I recognise the argument by my hon. Friend the Minister that the Bill is narrowly defined and is concerned simply with trade marks. I still regret that it was not possible to include a provision to allow trading standards officers to seize goods that they believe infringe the Copyright Act 1911, as they will be able to do in future for those goods that they believe infringe the trade mark laws. I hope that my hon. Friend will consider the matter again and see whether there is any way in which the Bill may be amended to allow the problem to be addressed.
Column 683Finally, I hesitate to plunge into the argument between the Minister and my hon. Friend the Member for Warwick and Leamington (Sir D. Smith) on the subject of look-alike products. However, I recognise that there has been a dramatic increase in recent years in the number of look-alike products sold by major retailers. Frequently, they are manufactured and marketed under similar names in similar packaging to the brand name goods with which they are competing. It is, therefore, understandable why the manufacturers of the original brands should feel aggrieved and should want the provisions of the Bill to be extended to ban look-alike products. Although I understand their view, I could support such a measure only if I thought that consumers were buying such products believing them to be the branded article. The fact that they are usually sold next to the brand-name product and at a cheaper price suggests that they are not. My hon. Friend the Member for Medway (Dame P. Fenner) has already referred to opinion surveys that show that consumers purchase look- alike products knowing that they are not brand-name products. I therefore tend to share the view of the Consumers Association that outlawing own brands would have nothing whatever to do with consumer protection but everything to do with market protection.
Mr. Malcolm Bruce : Does the hon. Gentleman also acknowledge that own-brand retailers such as Sainsbury, Boots and Tesco essentially market a brand image and that they need to maintain a quality standard if they are to sustain consumer confidence ?
Mr. Whittingdale : I entirely accept that. Those manufacturers have taken great pride in the quality of their products and it is clearly in their interests that all their products should be of a high quality. If not, they would do substantial damage to their general image.
However, retailers have a duty to ensure that their own brands are not too similar to branded products. I understand the argument that the shape of a container may be dictated by its function, and I should not want a manufacturer to be given a monopoly over a product's shape or function, but if it becomes apparent that the only reason for choosing a feature or shape is to increase the product's similarity to a branded product, the manufacturer of the brand-name product would be entitled to take action under existing law covering the passing off of goods.
Although the law already covers that problem, I hope that both manufacturers and retailers will take advantage of the suggestion by my hon. Friend the Member for Meriden (Mr. Mills), who has a long and distinguished history in the field, to come together and discuss what can be done to allay the fears that undoubtedly exist among brand-name manufacturers.
The Bill represents a valuable step forward in increasing the protection of trade marks and thus intellectual property. It is no doubt a field in which British companies need all the protection that they can get. I hope that my hon. Friend the Minister will see whether protection can be increased in any other way, particularly to cover the problems faced by the music industry. If it is not possible to amend the Bill to cover that problem, I hope that in the near future he will consider introducing additional legislation to deal with it.
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Mr. Tim Rathbone (Lewes) : First, I apologise to you, Mr. Deputy Speaker, my hon. Friend the Minister and the House for not being here at the beginning of the debate. I could not escape from an earlier meeting. Secondly, may I, at the outset, declare an interest--I am a parliamentary consultant to Chanel. I am grateful to Chanel for its briefing, but wish to make it clear that any opinions that I express are entirely mine and should not be laid at its door.
Like other hon. Members, I congratulate the Government on the Bill--on how it has been presented and on the accent that it has placed on the seriousness of trade marks and counterfeiting. From what I have heard from the professions involved outside the House, thanks are due to my hon. Friend's departmental officials for their consultations and positive reactions to representations made to them. In the same breath as welcoming the Bill, may I welcome the amendments that the Government made in another place, particularly the closure of the loophole in current legislation, which does not allow the seizure of goods in the form of a trade mark--a small element of counterfeiting--and the criminal provisions forbidding the use of the phrase "brand copy" or similar phraseology. Those are both important small additions to the Bill for which the Government deserve praise.
I also welcome the easier qualification of trade marks for registration, the simpler procedures for assigning trade marks and the better protection of trade marks overseas. I hope that that will lead to general ratification by all European Community members of the protocol to the Madrid agreement on the international registration of trade marks. Will my hon. Friend the Minister reassure me about the Government's position on that ?
I wish to raise one or two questions, the first of which you, Mr. Deputy Speaker, will understand better than most because you have shared with me a certain amount of time in the woolly world of advertising. It concerns comparative advertising. I am worried about the effect of clause 9, which can weaken the trade mark's legal protection. That would run contrary to the thrust and point of the Bill. It could allow unknown or lesser-known competitors to ride in unfairly on the coat tails of brands that are well established in the marketplace at the cost of those brand producers, and could even mislead consumers. I should prefer the whole question to wait upon the European Community trade marks directive, which the Bill has over- anticipated. The directive on misleading advertising will probably appear in the next few months and certain words have been suggested as a specific clause to deal with imitation products : "comparisons must not present goods or services as imitations or replicas of goods and services which are already protected by registered trade marks, trade names, and/or designations of origin." Whether we adopt those words now as an amendment to the Bill, or postpone action until the directive exists, the directive will come down the road towards us and this country, like others in the European Community, will have to fall in line. That is particularly the case as the Government have emphasised their intention to achieve that position on other trade mark issues. So I hope that action on that front can be delayed.
In the meantime, if action is to be taken, it is important to understand properly the meaning of "unfair use". The concern has been expressed to me that the clause could lend itself to litigation to establish the meaning of "unfair
Column 685use". In the interests of clarity and certainty, and even if it may keep some business away from my hon. and learned Friends who are lawyers, it would be better to deal with the matter as
straightforwardly as possible. On that basis, I hope that the Community wording will be adopted. The overriding concern must be that comparative use of trade marks is fair and safeguards are sufficient.
Like my hon. Friend the Member for Warwick and Leamington (Sir D. Smith), may I say a word about lookalikes ? What has been said so far may have caused people to mix up the problem of lookalikes and the question of private labelling. The problem of lookalikes is about identifying an act of unfair competition to supply goods that look similar by shape, colour, design or name to goods with a distinctive appearance, where it would take unfair advantage of that appearance or lead to an association between the goods.
The Paris convention on the protection of intellectual property requires EC countries to provide effective protection against such forms of unfair competition. The United Kingdom, unlike most of the rest of Europe, has no such legislation. The directive itself must conform with the Paris convention, and the Government aim to align the Bill with the directive.
It seems from the debate in another place that the Government believe that they are fulfilling their obligations under the Paris convention by means of the laws governing trade mark infringement and consumer protection. It was on that basis that an amendment was withdrawn in another place while the Government reviewed the matter. I understand from what the Minister said that the review has taken place and it has been decided not to include such a measure--I therefore hope that a further review will take place.
I welcome the Government's confirmation of the serious nature of product counterfeiting and their requirement to retain current sentencing provisions--an unlimited fine and up to 10 years' imprisonment. I hope that the courts will bear that in mind when dealing with counterfeiting cases. As we know, sentences are sometimes provided for the courts, but then not sufficiently used, even though certain cases may deserve them.
Counterfeiting certainly acts to the detriment of consumers, who are entitled to expect protection against products that are not what they claim to be, of legitimate retailers, who are entitled to expect fair competition, and of brand owners, who are entitled to expect protection for the branded products in which they have invested and for which they have offered quality control guarantees. It is to the advantage of this country that we set an example in our legislation, with effective enforcement and deterrent sentencing.
The Government have offered reassurances in another place that police and trading standards officers continue to have a duty to enforce the criminal laws against counterfeiting. I should welcome further confirmation from my hon. Friend of police powers and duties in this respect.
My last worry concerns the doubts that some have expressed about when the Bill, if it passes smoothly through its parliamentary stages, will become law. I am led to believe that that is unlikely to happen before the end of the year. If so, it will allow counterfeiters to exploit the weaknesses of current legislation during the most lucrative time of the year--the build- up to Christmas. It would thus be of significant benefit to the prosecuting authorities, to
Column 686legitimate retailers, to consumers and to brand owners if the Bill were delayed as little as possible and if the Government made every effort to ensure that at least the anti- counterfeiting provisions come into force by September or October. If the Minister cannot reassure me about that today, I hope that he will do so at a later date.
Mr. McLoughlin : Every hon. Member who has participated in the debate has given the Bill--in general--a warm welcome. It would be wrong to answer some of the questions that have been asked in a Second Reading closing speech, but they will be dealt with in Committee.
The hon. Member for Edinburgh, South (Mr. Griffiths) did his best as an Opposition spokesman to attack the Bill in the expected manner, but he may have gathered from the tenor of the rest of the debate that this really is not the sort of Bill that demands his sort of attack. It comes a little rough to hear him criticising the Government for not being consistent on Europe ; his party has changed its policy on Europe at every single general election. The same goes for his accusations that we are putting extra costs on British industry ; his party would implement the social chapter, so that, too, was a bit of a joke. I therefore cannot take too seriously some of his objections.
I am nevertheless grateful for the hon. Gentleman's general welcome for the Bill and in Committee we shall--rightly--examine some of the important cases and points that he highlighted.
The hon. Member for Newport, West (Mr. Flynn) mentioned the review at the Patent Office. We had hoped to make an announcement about that before today, but we are not in a position to do so. We shall make one to Parliament in due course.
I am grateful for the credit that the hon. Member for Newport, West gave to the operations of the Patent Office. I seem to recall hearing him, in the distant past, attacking "next steps" agencies of other kinds
Mr. Flynn : I refer the hon. Gentleman to the Leader of the House who, in an uncharacteristic moment, paid tribute to my work criticising the lack of accountability of "next steps" agencies, and said that he agreed with my campaign, supported by the Rowntree Foundation, which aimed to get the Government to publish replies from "next steps" agencies. Those replies used not to be published in Hansard : now they are.
I recognise immediately the expertise that my hon. Friend the Member for Meriden (Mr. Mills) brings to the subject. Probably most of his questions will be dealt with in greater detail in Committee. He asked me about trade mark attorneys. Proposals concerning the use of the title trade mark attorneys were received only recently, so it is difficult to give full consideration to that at this stage. Again, it is doubtless a point for Committee.
My hon. Friend also asked me about county courts. He will know that the Government are considering extending their jurisdiction to allow them to hear trade mark cases. The Courts and Legal Services Act 1990, however, contains all the necessary powers to confer such jurisdiction on county courts, so it would be wrong to use this Bill for that purpose. I know that my hon. Friend has
Column 687made representations on the subject to the Lord Chancellor and I have no doubt that we shall discuss it again in Committee, as it is important.
In my opening speech, I explained why I believed that the proposals in the Bill deal with a number of the points that arose out of the Kent County Council v. Price case. We shall return to that in Committee, too. It is related to many of the wider issues raised by my hon. Friend the Member for Colchester, South and Maldon (Mr. Whittingdale).
The hon. Member for Gordon (Mr. Bruce) talked about establishing two systems. The establishment of a Community mark as well as the international protocol is not at all unfortunate. Those systems are complementary and provide international business with a choice, according to where its interests lie. The confusion suggested by the hon. Member does not really exist.
My hon. Friend the Member for Colchester, South and Maldon made some wider points about counterfeiting ; some of what he said certainly concerns the British Phonographic Institute. It has discussed those concerns with me. We are dealing primarily with trade mark legislation rather than counterfeiting legislation, and it is important that that is understood.
My hon. Friend the Member for Lewes (Mr. Rathbone) asked about comparative advertising, which is addressed in clause 10. My information is that clause 10 does not go against the draft directive on comparative advertising. Clause 10(6) is very much in tune with the directive in its most recent draft. My hon. Friend asked why comparative advertising was allowed to be used. The Government's intention was announced in the White Paper. We think that the present position is too restrictive on competition.
It is reasonable to be able to identify competing products by reference to their trade marks. However, use must be in accordance with honest practice. To do otherwise would allow an unknown brand, for example, to get a leg up on the chain by claiming equivalence with the
Column 688brand on which the marketing effort was being expanded. We shall return to that issue in Committee and possibly on Report. May I put my hon. Friend the Member for Lewes right on the issue of lookalikes. As I said, the Government have not yet taken a view. We are consulting on the matter, but at this stage we do not think that the issue can be addressed under trade marks legislation. I think that that also answers the point of my hon. Friend the Member for Warwick and Leamington (Sir D.Smith). I can tell him that that matter did not come up during the early part of consultation on the Bill, but came to us fairly late. Many of my hon. Friends raised that matter in the debate.
The Bill will replace an outdated Act that has ceased to serve the best interests of industry and commerce by making it easier to register a trade mark, widening the rights given to a registered trade mark and deregulating procedures. United Kingdom companies will undoubtedly benefit. The international aspects should enable those companies that export their branded products to register more easily and protect their trade marks overseas. I commend the Bill to the House.
Question put and agreed to.
Bill accordingly read a Second time, and committed to a Standing Committee, pursuant to Standing Order No. 61 (Committal of Bills).
Queen's Recommendation signified.
That, for the purposes of any Act resulting from the Trade Marks Bill [ Lords ], it is expedient to authorise the payment out of money provided by Parliament of any expenses of the Secretary of State in consequence of the Act.-- [Mr. Kirkhope.]
That, for the purposes of any Act resulting from the Trade Marks Bill [ Lords ], it is expedient to authorise the charging of fees in respect of applications and registration and other matters under the Act.-- [Mr. Kirkhope.]
That the draft Isle of Wight (Structural Change) Order 1994, which was laid before this House on 22nd March, be approved.
I pay tribute to my hon. Friend the Member for Isle of Wight (Mr. Field), who has carefully followed all the debates, has made many representations and has kept himself closely in touch with opinion throughout the island. I hope that the legislation attracts widespread approval in his constituency. I hope that in subsequent orders we shall achieve a similar measure of consensus, because that would be helpful.
The draft order gives effect to the Local Government Commission's main recommendations for local government structure on the Isle of Wight. We think that more effective and convenient local government on the island will be achieved by establishing a unitary authority for the whole island-- the commission's first recommendation--and that that will reflect the identities and interests of local people. That recommendation has received all-party support from the local authorities on the island and from both district and county councils.
The order provides for reorganisation on 1 April 1995. On that date, the functions and powers of the borough councils will transfer to the Isle of Wight county council, which will become the sole principal council for the island and will be known as the Isle of Wight council. I emphasise that under reorganisation entirely new councils will be established. We are not debating the takeover of somebody by somebody else--the destruction of one form of council and the exaltation of another form. What emerges will be borrowed from both, but will be different from both as they are presently constituted.
To ensure a smooth transition to the new structure, the county council will be given some extra powers from 3 May. Those will enable it to make the necessary preparations, including budget setting, and appoint staff for the assumption of its full competence under its new powers the following April.
In response to local views, we are providing for elections to the Isle of Wight council in May 1995 so that councillors with a fresh mandate may take over responsibility for providing all local authority services. The Local Government Commission recommended that the unitary authorities should continue to produce separate local and structure plans. In the only amendment that we have made to the commission's proposals, we say that the planning needs of the island would be better served if the unitary authority were to prepare a unitary development plan rather than to continue the two-tier planning system. The draft order provides for such a requirement. It will probably be more helpful to the House if I confine my introduction to those remarks. By leave of the House, I shall sum up and answer questions that are directed to me.
Mr. Doug Henderson (Newcastle upon Tyne, North) : The Minister said that he wants to expedite the business of the House by reserving his position until questions are posed to which he will try to provide answers. I am pleased that he has taken that position because a number of
Column 690questions are pertinent to the Isle of Wight and also to the order's implications for the rest of the country. I hope that the Minister will be able to reassure us on such matters.
The Minister is aware that local government reorganisation is controversial in the areas that are affected--potentially in 39 county areas and in various district councils. It is controversial within the political parties. As the Minister will also know, it appears to be controversial in such beautiful parts of the country as Oxfordshire and, I think, Norfolk. I have always believed that it is never wise to listen to too much gossip in the House, but there is considerable gossip that reorganisation is controversial in parts of Suffolk--even in south Suffolk. Plainly, many hon. Members are deeply concerned about the matter and I share many of those concerns. I make it absolutely clear that the Opposition firmly support the principle of the establishment of unitary authorities in England. We have not been converted recently to that : we have believed in it for a long time, and even before the 1974 reorganisation of local government. We support the principle because we believe that boundaries that can be established on a unitary basis in many instances better reflect the communities that the local authorities based in those boundaries seek to represent. There is a sense of identity that is sometimes missing from the structure of local government in some parts of the country.
The Opposition have also supported the principle of unitary authorities because an effective and efficient unitary authority can avoid duplication- -of which, as many hon. Members know, there are many instances in local government. On planning, for example, district and county councils have to liaise and there is sometimes a certain amount of difficulty in understanding who has responsibility for what. On recreation and the link with school sports, there can often be different responsibilities for providing similar facilities. The avoidance of duplication has always been impressed on me as being important. Cost savings may not necessarily occur, but they can accrue if there is greater efficiency, better service and more value for money. That would allow more services to be provided to communities throughout the country for the same money available now. If more money were allocated, even more facilities could be provided if efficiency gains are made.
One strong argument in favour of unitary authorities is that the public know who is responsible for issues affecting them and administered by local government. I have always found that helpful in my own local authority. The public know that if the matter is one dealt with by local government, Newcastle city council is the responsible authority. They do not have to determine whether it is a district or county council issue. Those arguments have long been held by the Opposition in supporting unitary councils.
I shall comment on how the order will impact on the Isle of Wight, but also refer to its implications for the other 30 authorities.
Madam Deputy Speaker (Dame Janet Fookes) : Order. Although the House may have a wide-ranging debate as to the order's effects on the Isle of Wight, I caution the hon. Gentleman against extending his remarks to the rest of the country.
Column 691noted that I should refer only to general issues affecting the Isle of Wight, but which may have similar implications elsewhere. With specific reference to the Isle of Wight, the Opposition support the establishment of a unitary authority. Island authorities are different and the order reflects their special position. It is similar to the type of authority established in the Scottish islands, where there is general agreement that a unitary authority is the best way forward.
Representatives of work people in the Isle of Wight and both district councils informed me that although the people of the Isle of Wight support a unitary council, they do not support a takeover by the existing county council of the functions of district authorities. People view as democratic the establishment of a new Isle of Wight authority that would embrace the powers previously held by the county council and district councils.
If a new authority is not established from the word go in new elections in which the people of the Isle of Wight can judge who they want to represent them, it is likely that the authority will get off to the wrong start. Some practices prevalent in the old county council, but which the new authority might want to change, could become re-established. When a new authority was eventually elected in May 1995, it would be unable to change established practice. That would put district authority staff at a disadvantage by comparison with county council staff, because they will prepare the plans for the new authority. That strengthens the argument for a democratic structure from the word go, in which new councillors bring together the experience of the county council and district councils in saying how they believe the authority should be shaped in future.
Mr. Curry : This should not become a point of contention, so perhaps it would be helpful if I intervened. If the successor organisation is coterminous with an existing organisation, we have no choice but that it should acquire the formal status of the existing council. On the Isle of Wight, we decided to entrust the county with preparing the elections because the overwhelming majority of representations were to do that, so that the new authority could be established. It is clearly intended--it is spelt out--that virtually the first act of the new council will be to hold elections. Elsewhere in the country, in the overwhelming number of cases--I say that because one does not know the exact circumstances--it is the intention to hold shadow elections that will prepare for the new councils, and the hon. Gentleman's point will be met. In the Isle of Wight, the circumstances are a little particular, which is why we chose the route that we did.
Mr. Henderson : The Minister anticipated my question. Many legal interpretations of the Local Government Act 1992 confirm the Minister's assertion that where boundaries are coterminous, the Government have no option but to proceed in the way that they intend. Given that situation, is there not political advantage to all in acknowledging that weakness and that any new structure would be strengthened by having a democratic basis from the word go ? Even in the Isle of Wight, where there is no great opposition to the concept of a unitary authority, there is enormous strength of feeling on the issue. That perhaps
Column 692undermines the arguments for a unitary authority there--but that concern would pale into insignificance by comparison with the opposition that the Minister would meet in other parts of the country, where there may be a majority but no consensus on what should happen.
I will give way to the Minister, if he will confirm that with every other order that comes before the House, there will be no question of not establishing a shadow authority from the word go.
Mr. Curry : As the hon. Gentleman knows, in the case of Cleveland we indicated that we are considering whether to follow the Isle of Wight precedent, to get the new authority operational, where there is a shift to councils that are established--in the sense that no entirely new entities are being created. Our general intention, however, is to have shadow elections, for precisely the reason that the hon. Gentleman gave--and particularly so that people may feel that recruitment, and so on, is on a level playing field.
Mr. Henderson : My interpretation of the Minister's intervention--he will correct me if I am wrong--is that there may be circumstances in which, in instances where boundaries are coterminous with existing boundaries, the Government will not feel under an obligation to initiate a shadow authority from day one. If I am right--and I note that the Minister does not seek to intervene again--that will cause considerable concern throughout the country. I can assure the Minister, on the basis of telephone calls that I received all last week, at the weekend and this afternoon, that many authorities have a deep interest in the matter.
Mr. Michael Bates (Langbaurgh) indicated assent .
Mr. Henderson : At least one Conservative Member acknowledges that that is so. Those authorities will be watching this debate like hawks for any guarantee that will prevent something being imposed in future that they would find unacceptable.
Ms Marjorie Mowlam (Redcar) : I express my appreciation to my hon. Friend on behalf of hon. Members on both sides of the House with an interest in Cleveland for teasing that out of the Minister. Many in Cleveland will be deeply disappointed at not having a chance of democratic elections as part of any changes.
Mr. Henderson : I am grateful to my hon. Friend for reinforcing my interpretation. I should not like to be left standing in the cold on the platform at Darlington station on my way to Newcastle, with a lobby of Cleveland councillors asking me for a definitive interpretation of the Minister's remarks.
Mr. Henderson : I am not sure that that takes the debate much further. Local authority associations may tell me that even after teasing something out of the Minister, they are not clear what it means.