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Lord Archer of Sandwell: This matter has already been the subject of our discussions. As the noble Baroness said, it was a suggestion made by colleagues in another place; the Government listened and the Bill has been improved. We are grateful.

On Question, amendment agreed to.

Clause 10 [Parliamentary control]:

Baroness Blatch moved Amendment No. 61:

Page 6, line 34, leave out from beginning to ("the") in line 38 and insert—
("Before making the Scheme, the Secretary of State shall lay a draft of it before Parliament.
(1A) The Secretary of State shall not make the Scheme unless the draft has been approved by a resolution of each House.
(2) Before making any alteration to the Tariff or to any provision of").

The noble Baroness said: In speaking to Amendment No. 61, perhaps I may also speak to Amendments Nos. 63 to 66 inclusive. The amendments change significantly the extent of Parliament's control over the scheme. At present the Bill requires the Secretary of State to lay a copy of the tariff, and any subsequent alterations to it, before Parliament. It also requires the Secretary of State to lay before Parliament statements of other key provisions made by the scheme; namely, those bearing on quantum.

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It has been argued in another place and elsewhere that this leaves too much control in the hands of the Executive and that Parliament should retain greater control over the new arrangements. We have reflected further on this and have been persuaded by the force of those arguments. The amendments proposed therefore will give Parliament, rather than the Executive, final control over every aspect of the new scheme.

Under the new amendments the Secretary of State would be required to lay a draft of the whole scheme—in its entirety—before Parliament. He would not be able to make the scheme until that draft had been approved by both Houses under the affirmative resolution procedure. Thus specific parliamentary approval would be required for every aspect of the new arrangements.

Once the new scheme was up and running, any changes to it, however minor, would also be subject to parliamentary control. Changes to the tariff itself and to key features of the scheme would require approval by the affirmative resolution procedure, while changes to the more minor and routine features would be subject to the negative resolution procedure. We believe that that strikes the right balance. It requires Parliament positively to approve changes to the more important aspects of the scheme, while leaving Parliament the choice as to whether changes to more minor matters should go through with or without a debate and vote.

The amendments now make it quite clear where ultimate control over the scheme rests. The Executive will still be able to propose changes but it cannot give them effect without recourse to Parliament. I beg to move.

Lord McIntosh of Haringey: We anticipated this debate early yesterday afternoon when discussing the amendments moved by the noble Lord, Lord Windlesham. We have all expressed our gratitude to the Government for the concession that has been made, in that the whole of the original scheme and tariff will be laid before Parliament for the affirmative resolution procedure.

At the risk of being ungrateful, I should like to make two points. First, the Committee will be well aware that the affirmative resolution procedure is very much inferior as a form of opportunity for Parliament to debate and amend legislation than legislation on the face of the Bill. There is always a trade-off between flexibility and administrative convenience, but we have attempted to show in the course of the debate on this Bill that administrative convenience and flexibility have been put to the fore at the expense of parliamentary accountability and responsibility. We regret that. Secondly, although in the amendments moved by the Minister the original tariff and scheme—which perhaps may be termed the first shot at them—come before Parliament in their entirety, alterations come before Parliament only if they fall under the headings of Clause 10(2). Those by no means cover all of the important issues that we have debated over the past day and a half. It will come as no surprise to the Minister that our approach to Report stage will to a considerable extent consist of an attempt to persuade the House that there

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are other important matters which ought to be included in the affirmative resolution procedure when they come forward as alterations. But, with those warnings, we are grateful for the amendments so far as they go.

On Question, amendment agreed to.

[Amendment No. 62 not moved.]

Baroness Blatch moved Amendments Nos. 63 to 66:

Page 7, line 2, at end insert ("the Secretary of State shall lay before Parliament a draft of the provision as proposed to be altered.").
Page 7, line 3, leave out subsection (3).
Page 7, line 7, leave out ("this section") and insert ("subsection (2)").
Page 7, line 9, at end insert—
("(4A) Whenever any other provision of the Scheme is altered, the Secretary of State shall lay a statement of the altered provision before Parliament.
(4B) If any statement laid before either House of Parliament under subsection (4A) is disapproved by a resolution of that House passed before the end of the period of 40 days beginning with the date on which the statement was laid, the Secretary of State shall—
(a) make such alterations in the Scheme as appear to him to be required in the circumstances; and
(b) before the end of the period of 40 days beginning with the date on which the resolution was made, lay a statement of those alterations before Parliament.
(4C) In calculating the period of 40 days mentioned in subsection (4B), any period during which Parliament is dissolved or prorogued or during which both Houses are adjourned for more than 4 days shall be disregarded.").

The noble Baroness said: I beg to move Amendments Nos. 63 to 66 en bloc.

On Question, amendments agreed to.

[Amendment No. 67 not moved.]

Clause 10, as amended, agreed to.

6.45 p.m.

Lord McIntosh of Haringey moved Amendment No. 68:

After Clause 10, insert the following new clause—

Annual review

(". The Secretary of State shall in consultation with the body of adjudicators review annually the Scheme and the Tariff and shall lay before Parliament annually alterations to the standard amounts of compensation set out in the Tariff to reflect changes in the Retail Price Index occurring in the preceding year.").

The noble Lord said: Amendment No. 68 is concerned with future up-rating for inflation. In a sense, the administration of this amendment is made easier by the amendments to Clause 10 which have just been agreed. The history of the matter is a little complicated and I will not do any more than summarise it. Basically, the original tariff was based on median awards for 1991 to 1992. The Government claim that the original tariff has been up-rated by 19 per cent. from the median figures to bring it up to date. I accept that that may bring it up to date for the present time, but the proposal is that the tariff levels will be reviewed only every three years rather than every year. Therefore, the tariff will not be reviewed for inflation until April 1999, three years after the date when the scheme is expected to come into effect. Until 1999 we will still be working on the 1994 figures even though they have been updated from the 1991 to 1992 review. It is fairly clear that, whichever

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Government are in power and however successful attempts to control inflation may be, there is a possibility that by 1st April 1999 the scheme will be out of date in financial terms.

We now have a provision that the original scheme, and a considerable number of alterations to it, must come before Parliament. I believe it is logical and in line with many other financial arrangements laid down in secondary legislation that the Secretary of State should, in consultation with the body of adjudicators, review the scheme and the tariff and lay before Parliament annually alterations to the standard amounts of compensation to reflect changes in the retail prices index that have occurred in the preceding year. This is commonly done. The Order Paper of your Lordships' House, if not perhaps the time on the Floor, is cluttered up with statutory instruments which update legislation for inflation. I think immediately of the assisted places scheme. That has always been updated every year, because the Government have a political interest in doing so. Surely, there is nothing exceptional or extraordinary about proposing that this scheme should also be updated every year in line with inflation. The Government would obtain better understanding of and credibility for the scheme if they agreed to this relatively minor amendment. I beg to move.

Baroness Blatch: We are quite happy to consult the panel as necessary or to receive their advice at any time that they wish to give it. Indeed, to reflect that we amended the Bill in another place. We have also undertaken to keep the operation of the scheme under general review, and specifically to review the tariff levels themselves every three years. We think that is quite sufficient and offers all the flexibility needed for a straightforward, tariff-based scheme. There is already a very considerable element for future inflation built into the tariff. The levels of the 1994 tariff scheme were based on previous board awards after a very generous allowance had been made for inflation. Indeed, in the event that allowance proved to be quite over generous. Those 1994 tariff levels included an element for loss of earnings and care. That has not been stripped away from the awards as the noble Lord is aware. Such elements are now to be paid separately in addition in the more serious cases. But we have not stripped those elements out of the tariff levels for the new scheme, which are the same as those in the 1994 tariff. They are therefore higher than they might otherwise have been. As such, they effectively include a significant cushion against future inflation.

There is therefore no case for reflating the tariff levels for the first three years of the new scheme's operation; nor is there any case for annual up-rating thereafter. With low future inflation, any potential loss that claimants might suffer from a three year review cannot be very great. I should also point out that where loss of earnings and special care are payable, those elements will go up automatically in line with wages and the cost of care. A very good proportion of the awards will be inflation-proofed. We believe that a three-year review is sufficient to be fair to all claimants.

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