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Lord McIntosh of Haringey: My Lords, I think my noble friend is using a wide definition of tax harmonisation. It has never been suggested that there should be any harmonisation of personal income tax.


Lord Carter: My Lords, at a convenient moment after 3.30 p.m. my noble friend Lady Hayman will, with the leave of the House, repeat a Statement that is being made in another place on NHS Direct.

Trustee Delegation Bill [H.L.]

3.8 p.m.

The Minister of State, Cabinet Office (Lord Falconer of Thoroton): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.

Moved, That the House do now resolve itself into Committee.--(Lord Falconer of Thoroton.)

On Question, Motion agreed to.

House in Committee accordingly.


Clauses 1 to 5 agreed to.

Lord Brightman moved Amendment No. 1:

After Clause 5, insert the following new clause--

Effect of this Act on section 25 of Trustee Act 1925

(" . The text of section 25 of the Trustee Act 1925 as amended by the Powers of Attorney Act 1971 and this Act is set out in Schedule (Text of section 25 of the Trustee Act 1925 as amended).").

The noble and learned Lord said: In moving Amendment No. 1, I wish to speak also to Amendment No. 2, although I shall not detain the Committee for many minutes. Amendment No. 2 is a Keeling schedule which I tabled in order to make it easier for the reader to understand the impact of Clause 5 of the Bill on Section 25 of the Trustee Act 1925. My amendments are supported by the Law Society.

The Minister telephoned me this morning to say that he would achieve the same result by tabling an amendment for Third Reading which would put the final form of Clause 25 of the Trustee Act into Clause 5 of the Bill. This would achieve, by an alternative route, exactly the result I sought and is wholly satisfactory.

I have only one tiny niggle. When the noble and learned Lord spoke to me on the telephone this morning, he told me that he would table the amendment for Third Reading. In a letter which reached me half an hour ago there is a slight gloss on that. The letter used the words,

    "at Third Reading or as soon as practicable thereafter".

2 Feb 1999 : Column 1422

Can the noble and learned Lord omit the words "as soon as practicable thereafter"? All that needs to be done is to transport the wording of Amendment No. 2 into Clause 5 of the Bill. The wording is absolutely accurate; it has been in the hands of the parliamentary draftsman for a fortnight and it has never been suggested that a single word needs changing. Would it not be better to send a polished Bill down to the other place rather than one which is still in need of amendment? I beg to move.

Lord Goodhart: I support the noble and learned Lord, Lord Brightman. This will be of considerable practical help to those who study the Bill--or Act, as it will become--in the course of their professional duties. I am glad that the Minister has agreed to accept it in principle. I am not sure whether this would meet with the approval of the noble and learned Lord, Lord Simon of Glaisdale, who has taken up a considerable part of the debates on the Access to Justice Bill in trying to remove surplus words from the Bill. In this case it seems to me to be appropriate, and I welcome the noble and learned Lord's amendment.

Lord Falconer of Thoroton: The amendment tabled by the noble and learned Lord, Lord Brightman, would result in the inclusion of what is called a Keeling schedule in the Bill. Introduced in 1937, these schedules--named after a Member of another place whose inquiries of the then Prime Minister gave rise to their use--are now little used. They tend to give rise to handling difficulties during the passage of Bills and set the amended provision in aspic. Future amendments to the provision would not show up on a Keeling schedule and it might become a trap for the unwary at a later date. However, the noble and learned Lord has put a persuasive argument that the provision in this Bill, which amends Section 25 of the Trustee Act, should be treated exceptionally.

He has accurately recorded the conversation we had. I undertake to introduce a government amendment--well, I say that I undertake to introduce a government amendment, but I am not going to give him satisfaction on his last point. I undertake that an amendment will be introduced at some stage, in effect, to set out the whole of the new Section 25 in the body of the Bill, which meets his point.

I did say to him on the telephone that it would be done by Third Reading. I am now told that I am not in a position to give such a watertight undertaking and that it might have to be introduced during the Commons stage of the Bill. I appreciate the humiliation to this House of not sending a Bill to the other place in tiptop form, but I am afraid that is the best I can do, and for that I apologise.

Lord Brightman: Subject to my slight niggle, I thank the noble and learned Lord for the helpful attitude he has adopted towards my amendment. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Remaining clauses agreed to.

2 Feb 1999 : Column 1423

[Amendment No. 2 not moved.]

Schedule agreed to.

House resumed: Bill reported without amendment.

Report received.

Contracts (Rights of Third Parties) Bill [H.L.]

3.15 p.m.

The Lord Chancellor (Lord Irvine of Lairg): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.

Moved, That the House do now resolve itself into Committee.--(The Lord Chancellor.)

On Question, Motion agreed to.

House in Committee accordingly.


Clause 1 [Right of third party to enforce contractual term]:

Lord Howie of Troon moved Amendment No. 1:

Page 1, line 8, leave out from ("may") to end of line 10.

The noble Lord said: I begin by apologising to my noble and learned friend the Lord Chancellor for tabling my four amendments rather late last evening. This did not give him the opportunity to study these amendments closely, and perhaps put his own name to them, as I am sure he would have been quite willing to do.

The amendments arise from a long-standing connection that I have had with the construction industry, as older Members of the House will know. I have a lifelong and continuing interest in the industry, and I declare it now. These amendments have been inspired by the Construction Industry Council. I shall begin by making a few general remarks and, in due course, deal with each amendment as briefly as I possibly can.

First, let me say that I have a feeling of having been here before. Perhaps Glen Hoddle can help me. I recall that in the 1980s, under a previous Lord Chancellor--the last but three or so, I think--we debated a Latent Damage Bill. Like this Bill, that was a law reform Bill, and is now an Act. It was a law reform Bill which impinged very heavily on the construction industry. But it did not deal with the 90 per cent. of latent damage cases connected with the construction industry as carefully as it did with the 10 per cent. of cases which were not. I feel there is something similar about this Bill.

It seems to me that the Bill ignores the nature of contracts in the construction industry. The Law Commission's proposals incorporated in the Bill take account mainly of arrangements involving one promisee and one promisor with roughly equal strength--contracts between equals, in other words--and a reasonably well-defined pattern of third parties.

The construction industry is not like that. Let us consider for a moment the building of a power station or, even more dramatic, the construction of the Channel

2 Feb 1999 : Column 1424

Tunnel. Projects of that nature involve a great network of contracts. The project is never given as a whole. It is given as a series of parts. It may well be that the main contractor on one part of the work has a subcontractor and on another part of the work that subcontractor is a main contractor and the first main contractor is himself a subcontractor. Then there is the whole body of specialist subcontractors on which the construction industry depends. All of those people can be main contractors, subcontractors or indeed third parties. The position is far more complex than the Bill, if I have understood it properly, makes out.

The contractors are not equal and that goes against the grain of the Bill. A multitude of contracts is involved. Very often a main contractor is able to impose on a subcontractor fairly onerous terms, especially if he is a specialist subcontractor. Each contract will have an amalgam of third parties, which might include the general public. By its nature a piece of construction is imprecise. We all know that the Jubilee Line may or may not be finished in time for the millennium. It will probably not be finished. That is commonplace in construction contracts because unforeseen circumstances arise. There are factors such as inclement weather, the fact that foundation conditions might be different or floods might occur. There might be union strikes, as was the case in the old days. There are all kinds of factors which impinge on a contract and make the contract liable to change during its period. That change impinges on the third parties.

Let us put the position at its most simple and assume that a construction contract is expected to last for nine months. The general public will have to put up with nuisance, bother, noise and all kinds of inconveniences for nine months. However, due to unforeseen circumstances, the contract lasts for 12 months. So the public's inconvenience is extended. People are hurt far beyond their expectations. That is a totally different situation from the generalised one-to-one contracts which the Bill envisages.

All I have to say--it is a fairly draconian so I shall say it as quietly as I can--is that these complications mean that Clause 1(1)(b) is unworkable in the construction industry. My amendment seeks to remove it. I should say for the ease of mind of my noble and learned friend that I do not intend to press any of my amendments to a Division. They are probing amendments. I beg to move.

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