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Mr. Cook: My hon. Friend may be right about the motivation of Conservative Front Benchers, although I note that, as yet, they have not achieved the same conversion among many of their Back Benchers. However, I do not agree with his premise: we cannot hope to maintain the supremacy of this Chamber on the basis of keeping the second Chamber illegitimate. If we are serious about maintaining our own pre-eminence, we must do so with confidence. We must not be afraid of providing for a legitimate second Chamber, which cannot act as a rival to us but can act as an ally in making sure that we have modern and effective means of scrutiny.

Mr. Malcolm Savidge (Aberdeen, North): I warmly welcome my right hon. Friend's statement, particularly his decision to have a Joint Committee of both Houses and a free vote in both Houses. Surely the constitution is a matter on which we, as parliamentarians, ought to try to transcend our partisanship and seek consensus. If there turns out to be disagreement between this House and the

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other House, will my right hon. Friend recall the point that he made earlier; that, in both Houses, there seems near unanimity that this House ought to have primacy? If there is a disagreement, logically we ought to have primacy in finding a decision.

Mr. Cook: It is certainly the case that there is broad agreement across a range of issues and the debates on composition—understandable, necessary and central—should not divert us from the fact that there is broad agreement outside that one narrow case. My hon. Friend referred to some of the party political responses and urged colleagues, as I have done, to respond as parliamentarians. I have been in this House long enough to know that it loves a cockpit of debate and rough and frank exchanges. It was necessary for us to go through the catharsis of this statement and the response to it. I hope that, having got that off their chest, the Opposition will now get down to work with us to find a way forward, because it is in the interests of this place and the whole of Parliament that we find the best consensus on that way forward.

Kevin Brennan (Cardiff, West): Given that all that the Joint Committee has to consider is the option of an appointed House, a fully elected House or the intermediate version, does my right hon. Friend agree that if it were meeting right now, it could have the options ready for consideration by about seven o'clock this evening and the House could be ready to vote on them? In other words, there is no need for the delay. There could be one meeting and we could have a vote before the summer. There should be no problem with that whatsoever.

Mr. Cook: My hon. Friend has spoken with great wisdom and authority. Were I to be locked in my room for five minutes, I could probably produce the options rather more quickly than by seven o'clock tonight. But it is the nature of democracy that we have to take other people with us and fully explore other perspectives. The Joint Committee will need to do that. I agree with my hon. Friend that even while doing that, there is no need for undue delay in coming back to the House with the options.

Mr. Chris Bryant (Rhondda): As one of the 304 Back-Bench Members of this House who supports a wholly or substantially elected second Chamber, I wholeheartedly welcome everything that the Leader of the House has said, particularly the idea that we shall hold a free vote. It is strange; one waits for a free vote for months, and then three come in a row.

Mr. Win Griffiths: Like the number 24 bus.

Mr. Bryant: Indeed. It is very exciting.

I urge my right hon. Friend not to allow any bishops to sit on the Joint Committee. There should not be any bishops in the House of Lords and there should not be any on the Joint Committee either.

Mr. Cook: Because of my hon. Friend's previous profession, he speaks with unusual authority about

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bishops, and when we have discussions with them, I think that I shall recommend that he speak on behalf of Labour Members.

This is a classic case in which it is right to proceed by a free vote. Different views exist on both sides of the Chamber, so it would be wrong to try to proceed on a party political basis, with the Whip applied. It is right that both sides be able to cast their votes freely, so that we can establish where the centre of gravity lies.

Julie Morgan (Cardiff, North): I, too, would like to offer a warm welcome to my right hon. Friend's statement, which constitutes a great step forward. I particularly welcome the free vote, given that the matter is one for Parliament. I also ask what some of my hon. Friends have asked: is there any reason why the Joint Committee should not be set up immediately, and why the options—we already know what they are likely to be—cannot be reported to the House immediately, so that we can get this part of the process over before the summer recess?

Mr. Cook: I agree that we need to proceed with the Joint Committee with all possible speed. As I have pointed out, specific questions need to be addressed and we need first to reach agreement on them, but I hope that they will not become obstacles to progress. Hon. Members have taken the opportunity in the past hour to air their own prejudices on the matter of composition, and it is already clear that the battle lines are well-established. The cases for and against a substantially elected second House have been well argued and aired, and I agree with my hon. Friend that the Joint Committee need not spend too long on the first phase of its work, although there will be much to be addressed in the second phase.

Paul Flynn (Newport, West): Will my right hon. Friend forgive the almost universally sour response from Opposition Members? The Conservatives find it difficult to cope with two features of his statement that are entirely alien to them: its precise response to the consultation process, and his offering a free vote in this House on an issue of substance—something that never happened in 18 years of Conservative Government. When consideration is given to who will chair the Joint Committee, will my right hon. Friend look to my hon. Friends the Members for Pendle (Mr. Prentice), and for Slough (Fiona Mactaggart), who live in the 21st century, rather than the self-nominated Members of the Opposition, whose spiritual home is the 17th century? Is it not right that this generation of parliamentarians anticipates with relish the undertaking of reforms during this Parliament which are centuries overdue?

Mr. Cook: I am grateful to my hon. Friend for his observations, and it is certainly true that I do not recall a response to consultation during 18 years of Conservative Government that accepted the need for a fresh approach. Indeed, I do not recall much consultation at all during those years. If there had been, we might have been spared the poll tax, for a start.

My hon. Friend mentions the fact that I have not commanded universal support from those on the Conservative Benches. I fear that I have had to carry that burden through most of my years in this House, and doubtless I will have to continue to do so. However, I am

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comforted by the warm and unanimous support that my statement has received from those on the Government Benches.

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Orders of the Day

National Insurance Contributions Bill

Order for Second Reading read.

Mr. Deputy Speaker (Sir Michael Lord): I should point out that Mr. Speaker has selected the amendment standing in the name of the Leader of the Opposition.

5.18 pm

The Chief Secretary to the Treasury (Mr. Andrew Smith): I beg to move, That the Bill be now read a Second time.

There is a simple reason for supporting the Bill: it supports an NHS that is collectively funded, comprehensively available and free at the point of need, and which is the best insurance policy in the world. We are building on the Beveridge principles by raising resources to help fund the cost of the national health service through national insurance contributions. The Bill will raise resources to enable record extra investment to be made in a reformed NHS.

The question is not whether we need increased investment, but how to raise the money for that investment, and the Bill points the way forward. We have examined alternative health care systems and found them wanting. The Wanless report identified the flaws in alternative models. Social insurance schemes are complex; the tax base is narrower and administration costs escalate. In France the typical employer pays £60 a week per employee.

Charging for clinical services means patients paying rising bills for individual operations and treatments. Basing our health care system on medical charges would mean that those who are ill would have to pay more for being ill. Private funding mechanisms tend to be inequitable and regressive, they have weak incentives for cost control, they have high administration costs, and they can deter appropriate use. In the United States, family premiums average about £100 per week and are set to rise next year by £13 a week.

An independent study of health care systems in eight countries, prepared by the European Observatory of Health Care Systems, was published alongside the Budget. We are open to new ideas. Where there are lessons to be learned we will learn them. We have examined the alternatives, but the principle remains: funding through national insurance and general taxation is simply the most equitable, stable and efficient means of raising money for the national health service.

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