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Mr. Oliver Letwin (West Dorset): Does my right hon. Friend agree that it would be interesting to know also what conversations between the Minister, his colleagues and the Commission preceded the emission of the letter from the Commission? It would be interesting to know precisely what requests were or were not made to the Commission, formally or informally, for assistance to get the Government off the hook by issuing such a letter, which was, as my right hon. Friend has pointed out, always a possibility. Should not the Minister give us a travelogue to make it clear exactly what contact he had?

Mr. Redwood: As always, my hon. Friend has put his finger on an extremely important point. It is possible that the Under-Secretary went to Brussels and implied that it would be very helpful to Britain if such a letter were written, because it would get him off the hook and avoid a potential large Government Back-Bench rebellion. He clearly has a vested interest in trying to explain to his hon. Friends and the nation that he has no power to do anything, that he is only the Minister and cannot be expected to sort out the problem, and that it is all the fault of Brussels. Now that he has a letter, he is able, directly or with the help of friends--perhaps another part of the magic crony circle is at work--to get decent people to back off because the Government are misinforming them about the true state of play of the relative powers of the House and Brussels.

Mr. Ian Bruce: I want the Minister to have the full question put to him. Although my hon. Friend the Member for West Dorset (Mr. Letwin) was very forensic, he did not mention that, when deals are done for the Department of Trade and Industry in Brussels or anywhere else, they are normally conducted by people from the Treasury or No. 10, or possibly by "Tony's cronies". We ought to know exactly who, if anybody, has been to the Commission to ask about these matters.

Mr. Redwood: My hon. Friend is absolutely right, and he has enlarged the question in a way that will further embarrass the Government.

We should like to know more about the web of influence and lobbyism that seems to have been working. Perhaps we have here the first case of cash for no influence. This might be the first case of a group being asked to pay money to a lobby group only to be told that it should obey the Government and not influence them for the better. I feel rather sorry for those who thought that their interests were being looked after, who now find that that is not being done properly in the way that they would expect. We need to know rather more about their change of heart.

Suffice it to say that Her Majesty's Opposition--and, I trust, other Opposition Members--wish to give proper support to community pharmacists. This is a problem which the Government could solve by using British law if they wanted to. Ministers should go to Brussels and argue the case for our businesses and the services in our communities, instead of using Brussels in an attempt to stifle a Back-Bench rebellion that would be very embarrassing for them.

8 Jul 1998 : Column 1110

The Government should understand that community pharmacies in this country, as Health Ministers recognise, provide an extremely important service, which is now at risk, not just because of Brussels, but because of the Government's actions and inactions. There are many questions that the Under-Secretary should answer before we finish the debate.

Mr. Nigel Beard (Bexleyheath and Crayford): This argument is not new. There is no division in the House about the wish to help retail pharmacies and maintain them in their role, which is invaluable to the communities they serve. At issue are the two approaches to safeguarding their position.

The approach outlined by the Government is to let the appeal to the Office of Fair Trading continue because, if it is successful, the Bill will allow the agreement to be maintained for five years. The appeal is highly likely to be successful, given that the Office of Fair Trading has previously adjudicated on the agreement and found it to be in the public interest. The proposed line would protect retail pharmacies' position for about five years, during which they could adjust to the new climate imposed by Brussels and the Bill.

5.45 pm

The right hon. Member for Wokingham (Mr. Redwood), however, proposes to hard-wire into the Bill perpetual protection for resale price maintenance for retail pharmacies. He tabled the amendment knowing that it is in breach of, or counter to, the principles of the legislation--articles 85 and 86--with which the Bill harmonises UK law. It is known also that the only outcome of pursuing the right hon. Gentleman's approach is that, if it were successful, Brussels would take over, investigate and, very likely, decide that resale price maintenance should be stopped. The pharmaceutical industry would then be in far greater jeopardy than if the Government's course were followed.

We came to the nub of the issue in the right hon. Gentleman's winding up. He is challenging the Government to go to Brussels and demand that the law is changed, knowing very well what the answer would be. What marks out the true obsessive is that, whatever the issue, he returns to the point of obsession, which in the right hon. Gentleman's case is Europe. We realise the true nature of the Opposition: the amendment has nothing to do with helping retail pharmacies; it is an attempt, yet again, to stage a confrontation with Europe to demonstrate the likely infringement of the sovereignty of British law. We have heard that case before and it is being rehearsed in exactly the same form tonight.

At issue is an attempt to dupe the retail pharmacies.

Mr. Redwood: Will the hon. Gentleman explain what is wrong with the idea of Ministers going to Brussels to try to achieve a sensible exemption for a British industry that will otherwise be damaged?

Mr. Beard: What is wrong is that the right hon. Gentleman knows that that is inconsistent with the Brussels legislation under which the Bill falls. The Bill tries to harmonise British legislation with that of Brussels so that--this is the precise point that the right hon. Gentleman made earlier--companies will not face double

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jeopardy and the uncertainties and expense of two legislative regimes. The right hon. Gentleman knows that, and all the legal advice that he has been given must have told him that, yet he persists with his amendment, knowing that it could lead only to a confrontation that cannot be won.

Retail pharmacies would be damaged by the amendment, and if they adopted the right hon. Gentleman as a friend they would have a false friend. However, they are more sensible, which is why they sent the right hon. Gentleman the letter he read out earlier. They will not be duped by this attempt to use them to stage a stunt that goes against Brussels and highlights the issue of European legislation and British sovereignty. I am thankful that the pharmaceutical industry has more sense than to listen to Opposition Members.

Mr. Andrew Lansley (South Cambridgeshire): I am grateful for the opportunity to support amendment No. 2 and to speak to new clause 4, which stands in my name.

My right hon. Friend the Member for Wokingham (Mr. Redwood) was right to emphasise the desirability of basing one's arguments, in the first instance, on what may be learned by talking to community pharmacists. As members of the Committee know, I was at pains to talk to staff of community pharmacies in my constituency and I instanced one in particular, in the village of Gamlingay.

The pharmacy in Gamlingay fully illustrates the predicament of community pharmacies. They often have a limited catchment area that does not give them a very high rate of return, but instrumental in that rate of return is the mark-up they are able to achieve on over-the-counter medicines, given their difficulty--to which the hon. Member for Eastleigh (Mr. Chidgey) rightly drew attention--in securing an adequate rate of return on the provision of prescription medicines and the valuable advice service that pharmacists provide.

In the example I offered, the pharmacist gave15 consultations a day. Each of those 15 consultations would have resulted in a general practice consultation but for the presence of a pharmacist. It is the only opportunity many people in the village have to access to a local pharmacy. The suggested alternative of a visit to a large, multiple superstore is not available within seven or eight miles.

There is every reason, therefore, to support community pharmacies. I understand from our debate in Committee that support for community pharmacies is not confined to the Opposition; Labour Members' support is evident. I shall not detain the House by quoting them, but Second Reading speeches by the hon. Member for South Thanet (Dr. Ladyman) and others gave particular support to community pharmacies.

The question is whether, in Committee, and especially in relation to the schedule introduced by the Under-Secretary to provide for new transitional provisions, the Government have provided the protection the House seeks for community pharmacies and for resale price maintenance on over-the-counter medicines in the long run. I say "in the long run" because it seems to me that when the other place made amendments and they were, initially, considered by the Committee, what was proposed presented a problem.

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At that stage, the case before the restrictive trade practices court would have been stayed and there would have been an accusation to be made to the Commission. This is at the heart of the problem. There would have been an accusation to be made to the Commission that the case had not been considered on its merits, including the public interest and general public health interests additional to the competition considerations; that the legislation had simply obviated--circumvented--proper consideration of those issues; and that, therefore, the Commission should take it upon itself to consider the issues.

For that reason, it was probably right for the amendments made in another place to be overturned in Committee and to be substituted by measures designed to give direct effect in the Bill to the House's intention to support resale price maintenance on over-the-counter medicines. However, the Government have gone about it in a way that has limitations, which were clear in Committee. Although the Government rest upon the question of the court considering the issue, if the court considers the issue and concludes that resale price maintenance does not act against the public interest, a protection is built into the Bill--a protection, through transitional provisions, for five years. However, there is no provision in the schedule to extend the transitional period further.

That brings us back to the letter that the Under-Secretary was at pains to speak about, and on which my right hon. Friend the Member for Wokingham rightly responded. The letter from the Community Pharmacy Action Group illustrates the point. The CPAG has been presented with two unpalatable options. The more unpalatable of the two is that the court goes ahead and comes to a conclusion without Government support for community pharmacies before the court--or, indeed, without the Government going to the Commission and saying, "You should rest on the court's decision". On the other hand, the action group is told, "Do not press the amendments; do not look for anything else; do not embarrass the Government on Report. Say that the Government have done what is required, and you will get Government support"--presumably by way of evidence, or whatever, before the restrictive trade practices court--"and you will subsequently benefit from the five-year transitional provision."

I say that with the evidence that, in the letter referred to, Mr. David Sharpe, chairman of the CPAG, says:


When the Under-Secretary replies to the debate, will he tell us the meaning of the phrase,


    "On the understanding that the Government will continue to support retaining the network of community pharmacies"?

That is the key question.


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