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The Parliamentary Under-Secretary of State, Department of Health (Baroness Hayman): My Lords, the Restrictive Practices Court has only recently considered the application from the Director-General of Fair Trading for leave to challenge resale price maintenance and has yet to announce its decision. It is premature to conclude that resale price maintenance will end in the near future, or that communities will lose access to pharmacy services as a result. The arguments and evidence have yet properly to be aired before the court. When they are, we will be much better placed to consider the likely consequences and to develop any necessary plans.

Lord Morris of Manchester: My Lords, I am grateful to my noble friend for her reply. Did she see the public tributes to Mrs. Gill Hawksworth for opening her small Mirfield pharmacy on 28th December in response to a flu epidemic, and helping 300 people, 75 of whom would otherwise have gone to accident and emergency departments or have put further pressure on local doctors? Yet her pharmacy and some 3,000 others will face closure if, perversely, resale price maintenance is ended and nothing is done to secure their survival. Is it not high time that all of us insisted that fair trade is not just about price, but also access, service and meeting the needs of local communities, not least of severely disabled people, the elderly and mothers with young children?

Baroness Hayman: My Lords, I certainly agree with my noble friend that the debate about resale price maintenance and access to community pharmacies is much wider than simply about the price of individual products. I am sure that the court will consider all aspects of the issue, including the question of access, before reaching its decision, and that that decision will have to be justified as being in the overall public

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interest. The Government recognise that community pharmacists are highly trained professionals and that as well as dispensing medicines they provide, as in the case instanced by my noble friend, an easily accessible and highly valued source of advice on a range of health and healthcare matters. We pay tribute to that. As I said in my Answer, I do not think that at this stage we can make any predictions about large numbers of community pharmacies closing. We must consider the basic issue of access to pharmacy services for the population as a whole.

Lord Marsh: My Lords, does the Minister agree that once one uses resale price maintenance in this way there is no end to the applications that could be used? Therefore, the only logical, if highly undesirable, method of dealing with the matter would be direct grants to such shops.

Baroness Hayman: My Lords, the noble Lord has put his finger on the point. As I understand it, the argument which arose during the proceedings on the Competition Bill, and which faces us now, is not about the overall aim--which is ensuring access to high quality primary care, including pharmacy services--but about whether that is best achieved by price control overall; or whether we should develop mechanisms which already exist like the essential small pharmacies scheme, which ensures a minimum level of NHS income for small pharmacies; or ensure in rural areas that there is access to GP dispensing of medicines so that we provide the access but do so in a targeted way.

Lord Clement-Jones: My Lords, can the Minister tell the House what representations the Department of Health has made to the OFT? Further, in the light of the debate about the role of community pharmacists, can the noble Baroness say when the Government's community pharmacy strategy is due to be published?

Baroness Hayman: My Lords, on the issue of representations, resale price maintenance is a competition matter that is appropriately dealt with by the court. It would not be right for Ministers to intervene in that respect. However, the community pharmacy strategy to which the noble Lord referred is an important element in the way in which we can develop the very vital services that community pharmacists provide. There has been a large number of responses to the invitation from my right honourable friend the Secretary of State to comment on this, and he recently held round-table discussions with pharmacy, nursing and medical leaders. There are many ideas floating around and many complicated issues to consider. However, I hope that it will not be too long before we can publish the strategy.

Lord Campbell of Alloway: My Lords, does the noble Baroness appreciate that once these community pharmacists--I have supported them on no less than three occasions in your Lordships' House--are closed by the order of the court they can never re-open? Therefore, surely it is wholly unsatisfactory to leave the

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matter in the air for the decision of a court when the Government can do something to ensure that they are not closed.

Baroness Hayman: My Lords, if I may say so, it is not the case that an order of a court would close down a community pharmacy if the argument is around the economic consequences which would flow from the abolition of resale price maintenance and the effect that it might have on the economic viability of individual businesses. I take the point made by the noble Lord that it is important to provide these pharmacy services to all patients who need them. However, there is more than one way of doing so. For example, we could look at health action zones to see whether it would be possible to provide pharmacy services in, say, healthy living centres to maximise benefit to local communities. I accept that there is an issue here that we must address; but, as I said to the noble Lord, Lord Marsh, I believe that the debate is whether it is best addressed through price controls.

Noble Lords: Next Question!

Lord Montague of Oxford: My Lords, I wanted to ask my noble friend about--

Noble Lords: Order!

The Lord Privy Seal (Baroness Jay of Paddington): My Lords, I think it is the feeling of the House that we should move on. I am sure that my noble friend will have another opportunity to put his question.

European Commission: Contractual Payments

2.53 p.m.

Baroness Young asked Her Majesty's Government:

    Whether the European Commission is fulfilling its obligations to pay its contractual commitments to British institutions and companies within 60 days.

Lord McIntosh of Haringey: My Lords, we understand that the noble Baroness is referring to the payment due to the West India Committee. This contract was between the West India Committee and the European Commission, with no involvement by Her Majesty's Government. We are advised by Commission officials that one of the causes of delay has been the lack of funds in 1998 and the lack of a facility to vire funds between budgets. They tell us that they hope to make the payment within the next two weeks, but we cannot be certain.

Baroness Young: My Lords, does the Minister realise that I do not consider that to be a satisfactory Answer to my Question at all? The noble Lord had no right whatever to raise the particular instance of the organisation with which, I admit, I am connected and in respect of which, therefore, I declare an interest. When I was asked about the matter behind my Question

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I stated that it had a general application. Is the Minister aware that there are a great many organisations that are owed very considerable sums of money, many of which have been waiting for payment for well over 120 days? That causes serious hardship to small businesses. I believe that both the noble Lord and the Government should look into this non-payment of money to firms doing work for the European Community.

Lord McIntosh of Haringey: My Lords, I am very sorry that the noble Baroness should be offended by the nature of my response. I understood from her indirectly that this was what she was concerned about and I sought to try to address her specific concerns rather than give a brush-off, which I might otherwise have had to give. However, if I did wrong, I apologise to the noble Baroness and to the House.

Yes, of course, the noble Baroness is right, I recognise that the West India Committee is not the only example; indeed, as a sub-contractor to the European Commission in the 1970s I experienced comparable problems myself. She is also right to say that there is something wrong at the Court of Denmark. We have been making very serious representations about late payment and about the payment of interest on late payments. I understand that the European Union has set up a new internal organisation to look at late payment procedures. We hope that the establishment of the new organisation will help to improve the situation.

Lord Wallace of Saltaire: My Lords, does the Minister accept that behind the Question there is a broader issue of the built-in inefficiencies within the Commission at present? Are the Government pressing for thorough-going reform of the Commission, including perhaps a reduction in the number of commissioners to ensure that the business of the European Union is effectively carried on?

Lord McIntosh of Haringey: My Lords, I was criticised for being too precise in my Answer and for not responding to the more general issue of late payments. However, the noble Lord, Lord Wallace, is now inviting me to comment on the efficiency of the European Commission as a whole, which is quite apart from the issue of late payments. I believe that that is going too far.

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