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9.51 pm

Mr. Heathcoat-Amory: Proceedings on the Bill have been characterised throughout by the Government's contempt for the House, and this debate has been no exception. This huge change in monetary policy, whereby interest rate decisions have been transferred to a committee of the Bank of England, was first announced not to the House but in a letter to the Governor of the Bank of England. That attitude towards the House has persisted.

The Government have rejected the cross-party position on confirmatory hearings. They have rejected a modest suggestion that not only the decisions of the Monetary Policy Committee but the reasons advanced by its members should be published in the minutes, which is in line with the White Paper on the public's right to know. Now the Chief Secretary asks us whether we are in favour of the Bill. It is rather terrifying that the man who is in charge of the nation's finances cannot remember what happened as recently as 11 November. We gave our reasons for voting against the Bill on Second Reading, and nothing has happened since then to change our minds. Indeed, our careful scrutiny of the Bill in Committee showed up a number of deficiencies that were not clear at the time.

The Bill still worries some Labour Members who were not represented on the Standing Committee and who do not like the idea of transferring decisions on economic policy from elected politicians to unelected bankers and officials. All I can say to them is that they have seen nothing yet. If the Government go ahead with their plan to transfer everything to the European central bank in Frankfurt, those hon. Members will know what it means

22 Jan 1998 : Column 1242

to transfer decisions on the British economy offshore entirely. That, however, is for another day and another debate.

In its current form, the Bill will not appeal to those of my hon. Friends who in principle support the concept of an independent central bank. The Bank provided for in the Bill will not be independent like, for instance, the Bundesbank or the Federal Reserve in the United States, and it does not qualify as an independent central bank under the treaty of Rome as amended at Maastricht. Further legislation will therefore be needed if and when we proceed to full economic and monetary union.

Rather than being independent and having genuine discretion in monetary policy, the Bank will work on a short-term contract from the Treasury. The only discretion that it will have, albeit an important discretion, will be in the setting of short-term interest rates; everything else will be decided by the Treasury. The Treasury will make all the appointments to the Monetary Policy Committee, and will ensure that they are all short-term appointments that will not last even for a full parliamentary term.

That brings us to the mysterious affair of the Treasury Committee. Conservative Members adopted in full the suggestions of that all-party Select Committee--

Mr. Darling: Will the right hon. Gentleman give way?

Mr. Heathcoat-Amory: I hope that the right hon. Gentleman will forgive me if I do not. I want to finish my speech shortly.

Conservative Members adopted the suggestions of the all-party Select Committee--chaired by a distinguished Labour Member--in regard to asking for confirmatory hearings. It was a modest request, as the Government had signalled in the Standing Committee that they were in favour of the principle. We wanted to ensure not that the House should have nomination rights, but simply that we could make certain that the Bill's requirements were implemented in regard to the competence and independence of candidates for membership of the MPC. That, as I said, had all-party support. Indeed, the Chairman of the Select Committee tabled an amendment to that effect, and one of his hon. Friends--also a member of the Select Committee--spoke in its support.

A Division was called, and all those Labour Members mysteriously disappeared. So much for democracy in the Labour party--but it should worry the House, as an institution, when, after the Opposition have picked up a modest, serious and well-argued proposition advanced in a Select Committee that has subsequently been tabled as an amendment and pressed to a Division, Labour Members are pulled off it by their Whips.

Other deficiencies came to light in the Standing Committee. I must say in passing that most of them were discovered by Conservative Members. The Liberal Democrats are fond of saying nowadays that they are the only people who put up proper opposition, but I must point out that the two Liberal Democrats on the Standing Committee turned up very seldom. I believe that the hon. Member for Twickenham (Dr. Cable) attended only four sittings. As usual, the real task of scrutinising the legislation and providing constructive opposition fell to Conservative Members.

Then there is the mysterious matter of the abstention, or disappearance, of the Paymaster General. We rather wish that he had been present this evening, because we

22 Jan 1998 : Column 1243

all have happy memories of his not only attending the Standing Committee sittings, but answering a good many of our debates. For instance, he replied to many of the debates about the method of appointment to the MPC. Yesterday, when we debated the Paymaster General's tax affairs, he did not turn up for that debate, but I really think that someone should have told him that he could come out of hiding this evening, because we were debating not his personal affairs but the Bill on whose Standing Committee he served.

We have had some inadequate replies to the points that we have made, but that does not completely surprise us. The central point is that our opposition to the Bill does not signal our opposition to low inflation. Whereas we met our inflation targets in the previous Parliament, the Government weakened their inflation target, and then missed it in every succeeding month. They have tried to shuffle off responsibility for those decisions on to the Bank of England. They will not succeed in that. We have no confidence in the Bill, and we will be voting against it.

Question put, That the Bill be now read the Third time:--

The House divided: Ayes 207, Noes 116.

Division No. 139
[9.59 pm


Ainsworth, Robert (Cov'try NE)
Alexander, Douglas
Anderson, Donald (Swansea E)
Anderson, Janet (Rossendale)
Ashdown, Rt Hon Paddy
Ashton, Joe
Atkins, Charlotte
Ballard, Mrs Jackie
Barnes, Harry
Beard, Nigel
Beckett, Rt Hon Mrs Margaret
Begg, Miss Anne
Bell, Martin (Tatton)
Bennett, Andrew F
Bermingham, Gerald
Berry, Roger
Blears, Ms Hazel
Breed, Colin
Brown, Rt Hon Gordon
(Dunfermline E)
Brown, Rt Hon Nick (Newcastle E)
Bruce, Malcolm (Gordon)
Buck, Ms Karen
Burnett, John
Butler, Mrs Christine
Byers, Stephen
Cable, Dr Vincent
Campbell, Mrs Anne (C'bridge)
Campbell, Ronnie (Blyth V)
Caplin, Ivor
Casale, Roger
Chapman, Ben (Wirral S)
Chisholm, Malcolm
Clapham, Michael
Clark, Rt Hon Dr David (S Shields)
Clarke, Charles (Norwich S)
Clarke, Tony (Northampton S)
Clwyd, Ann
Coaker, Vernon
Coleman, Iain
Colman, Tony
Cooper, Yvette
Corston, Ms Jean
Cotter, Brian
Cousins, Jim
Cox, Tom
Cranston, Ross
Crausby, David
Darling, Rt Hon Alistair
Davey, Edward (Kingston)
Davis, Terry (B'ham Hodge H)
Dean, Mrs Janet
Denham, John
Dismore, Andrew
Dobbin, Jim
Doran, Frank
Dowd, Jim
Drew, David
Eagle, Angela (Wallasey)
Eagle, Maria (L'pool Garston)
Edwards, Huw
Efford, Clive
Fatchett, Derek
Field, Rt Hon Frank
Fitzpatrick, Jim
Fitzsimons, Lorna
Flint, Caroline
Follett, Barbara
Foster, Michael Jabez (Hastings)
Foster, Michael J (Worcester)
Gapes, Mike
Gardiner, Barry
George, Bruce (Walsall S)
Gerrard, Neil
Gibson, Dr Ian
Godman, Norman A
Godsiff, Roger
Grant, Bernie
Griffiths, Win (Bridgend)
Hain, Peter
Hall, Mike (Weaver Vale)
Hall, Patrick (Bedford)
Hanson, David
Harman, Rt Hon Ms Harriet
Harvey, Nick
Heal, Mrs Sylvia
Heath, David (Somerton & Frome)
Henderson, Ivan (Harwich)
Heppell, John
Hesford, Stephen
Hewitt, Ms Patricia
Hill, Keith
Hoey, Kate
Hope, Phil
Howarth, Alan (Newport E)
Hughes, Ms Beverley (Stretford)
Hughes, Kevin (Doncaster N)
Hurst, Alan
Hutton, John
Iddon, Dr Brian
Ingram, Adam
Jackson, Ms Glenda (Hampstead)
Jackson, Helen (Hillsborough)
Johnson, Alan (Hull W & Hessle)
Johnson, Miss Melanie
(Welwyn Hatfield)
Jones, Mrs Fiona (Newark)
Keeble, Ms Sally
Keen, Alan (Feltham & Heston)
Keen, Ann (Brentford & Isleworth)
Kelly, Ms Ruth
Kennedy, Jane (Wavertree)
Khabra, Piara S
King, Andy (Rugby & Kenilworth)
King, Ms Oona (Bethnal Green)
Ladyman, Dr Stephen
Laxton, Bob
Lepper, David
Levitt, Tom
Lewis, Ivan (Bury S)
Liddell, Mrs Helen
Linton, Martin
Livingstone, Ken
Lock, David
McAvoy, Thomas
McCafferty, Ms Chris
McDonagh, Siobhain
Macdonald, Calum
McDonnell, John
McGrady, Eddie
McIsaac, Shona
Mackinlay, Andrew
McNulty, Tony
MacShane, Denis
Mactaggart, Fiona
McWalter, Tony
Mallaber, Judy
Marshall, Jim (Leicester S)
Marshall-Andrews, Robert
Meale, Alan
Michael, Alun
Milburn, Alan
Miller, Andrew
Moffatt, Laura
Moore, Michael
Moran, Ms Margaret
Morley, Elliot
Morris, Ms Estelle (B'ham Yardley)
Mudie, George
Naysmith, Dr Doug
O'Brien, Mike (N Warks)
Olner, Bill
Pearson, Ian
Perham, Ms Linda
Pickthall, Colin
Pike, Peter L
Plaskitt, James
Pollard, Kerry
Pond, Chris
Pope, Greg
Pound, Stephen
Powell, Sir Raymond
Prentice, Ms Bridget (Lewisham E)
Prentice, Gordon (Pendle)
Primarolo, Dawn
Prosser, Gwyn
Quin, Ms Joyce
Radice, Giles
Reed, Andrew (Loughborough)
Reid, Dr John (Hamilton N)
Rendel, David
Rooker, Jeff
Russell, Bob (Colchester)
Salter, Martin
Sanders, Adrian
Savidge, Malcolm
Sawford, Phil
Sedgemore, Brian
Shaw, Jonathan
Sheldon, Rt Hon Robert
Smith, Rt Hon Andrew (Oxford E)
Smith, Angela (Basildon)
Smith, John (Glamorgan)
Soley, Clive
Spellar, John
Starkey, Dr Phyllis
Stewart, David (Inverness E)
Stewart, Ian (Eccles)
Stinchcombe, Paul
Stoate, Dr Howard
Stuart, Ms Gisela
Taylor, Rt Hon Mrs Ann
Timms, Stephen
Tipping, Paddy
Todd, Mark
Turner, Dr Desmond (Kemptown)
Vaz, Keith
Vis, Dr Rudi
Wallace, James
Walley, Ms Joan
Ward, Ms Claire
White, Brian
Wicks, Malcolm
Wise, Audrey
Wood, Mike
Worthington, Tony
Wright, Anthony D (Gt Yarmouth)
Wright, Dr Tony (Cannock)
Wyatt, Derek

Tellers for the Ayes:

Mr. Jon Owen Jones and
Mr. Clive Betts.


Ainsworth, Peter (E Surrey)
Arbuthnot, James
Atkinson, David (Bour'mth E)
Atkinson, Peter (Hexham)
Bercow, John
Beresford, Sir Paul
Body, Sir Richard
Boswell, Tim
Bottomley, Peter (Worthing W)
Brady, Graham
Brazier, Julian
Browning, Mrs Angela
Bruce, Ian (S Dorset)
Burns, Simon
Chapman, Sir Sydney
(Chipping Barnet)
Clappison, James
Clark, Rt Hon Alan (Kensington)
Clark, Dr Michael (Rayleigh)
Collins, Tim
Colvin, Michael
Cran, James
Davis, Rt Hon David (Haltemprice)
Day, Stephen
Duncan, Alan
Duncan Smith, Iain
Emery, Rt Hon Sir Peter
Evans, Nigel
Faber, David
Fallon, Michael
Flight, Howard
Forth, Rt Hon Eric
Fox, Dr Liam
Gale, Roger
Garnier, Edward
Gibb, Nick
Gill, Christopher
Gillan, Mrs Cheryl
Goodlad, Rt Hon Sir Alastair
Gorman, Mrs Teresa
Green, Damian
Greenway, John
Grieve, Dominic
Hamilton, Rt Hon Sir Archie
Hammond, Philip
Hawkins, Nick
Hayes, John
Heald, Oliver
Heathcoat-Amory, Rt Hon David
Horam, John
Howarth, Gerald (Aldershot)
Hunter, Andrew
Jack, Rt Hon Michael
Jackson, Robert (Wantage)
Jenkin, Bernard
Key, Robert
King, Rt Hon Tom (Bridgwater)
Kirkbride, Miss Julie
Laing, Mrs Eleanor
Lait, Mrs Jacqui
Lansley, Andrew
Leigh, Edward
Letwin, Oliver
Lewis, Dr Julian (New Forest E)
Lilley, Rt Hon Peter
Lloyd, Rt Hon Sir Peter (Fareham)
Loughton, Tim
Luff, Peter
Lyell, Rt Hon Sir Nicholas
MacGregor, Rt Hon John
McIntosh, Miss Anne
MacKay, Andrew
Maclean, Rt Hon David
McLoughlin, Patrick
Malins, Humfrey
Maples, John
Mates, Michael
Maude, Rt Hon Francis
Mawhinney, Rt Hon Sir Brian
May, Mrs Theresa
Moss, Malcolm
Nicholls, Patrick
Norman, Archie
Ottaway, Richard
Paice, James
Paterson, Owen
Pickles, Eric
Prior, David
Randall, John
Robathan, Andrew
Robertson, Laurence (Tewk'b'ry)
Roe, Mrs Marion (Broxbourne)
Rowe, Andrew (Faversham)
Ruffley, David
St Aubyn, Nick
Simpson, Keith (Mid-Norfolk)
Spelman, Mrs Caroline
Spring, Richard
Steen, Anthony
Swayne, Desmond
Syms, Robert
Taylor, Ian (Esher & Walton)
Taylor, John M (Solihull)
Taylor, Sir Teddy
Thompson, William
Townend, John
Tredinnick, David
Tyrie, Andrew
Walter, Robert
Waterson, Nigel
Wilkinson, John
Willetts, David
Wilshire, David
Winterton, Mrs Ann (Congleton)
Winterton, Nicholas (Macclesfield)
Woodward, Shaun
Young, Rt Hon Sir George

Tellers for the Noes:

Mr. John Whittingdale and
Sir David Madel.

Question accordingly agreed to.

22 Jan 1998 : Column 1245

Bill read the Third time, and passed.

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