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Lord Waddington: My Lords, I thank the noble Lord for that reply. Is it right that in purported compliance with the Code of Conduct on Business Taxation, which requires member states to report measures constituting unfair tax competition to the Code of Conduct Group, the Government reported for possible elimination 11 tax measures in Guernsey and Jersey? What right had the Government to do so when the Channel Islands are not territories of the United Kingdom within letter M of the code but self-governing dependencies of the Crown, and the Code of Conduct is not, therefore, an international agreement requiring the Government to interfere in the islands' affairs? What right have the Government to interfere when the islands are not members of the EU and, in the words of the very report to which the noble Lord referred (at paragraph 1535), the taxes that they impose, and their level, remain a matter for the islanders to decide?

Lord Williams of Mostyn: My Lords, the noble Lord, Lord Waddington, is right in his description of the constitutional relationship. The islands are self-governing Crown dependencies, each with its own internal independent legislature. The Code of Conduct group is being chaired by my right honourable friend the Paymaster General. I am happy to reassure the House about an important point upon which we struggled and which we insisted upon having incorporated in the code. It requests member states to apply its principles to its dependent and associated territories only,

Lord Barnett: My Lords, harmful tax competition is a serious matter, whether it applies to the Channel

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Islands, the Isle of Man or even Bermuda, where the noble Lord was recently a distinguished governor. However, are not these matters best dealt with at an international level? Is the Paymaster General having serious discussions in the EU to bring forward a helpful directive to stop such harmful tax competition?

Lord Williams of Mostyn: My Lords, my noble friend is right in saying that this is an international matter. A number of approaches are being taken. We have set up the Code of Conduct Group; the draft directive on savings is still subject to my earlier caveat within the framework of the constitutional arrangements; and an OECD forum is compiling a list of tax havens for November this year. I should stress that the islands are taking part in that exercise and it is fair to all concerned to draw to the attention of the House paragraph 14.10.3 of Andrew Edward's report which states:

    "The island authorities have argued with force that the issues involved in harmful tax competition are far from simple or straightforward". Turning to the point made by my noble friend Lord Barnett, the report continues:

    "They have made known, rightly in my view, that they wish to play a full and constructive part, through whatever channels are available, in the global discussions".

Lord Pearson of Rannoch: My Lords, do the clauses which the Minister quoted from the Kilbrandon Report not make it absolutely clear that this country does have the right to override the islanders' wishes in tax matters if our international obligations, such as those contained in the Treaty of Rome, so require? In those circumstances, can the Minister tell the House what is the outcome of the recent deputation of civil servants from the islands to the EU Commission in Brussels to discuss this problem?

Lord Williams of Mostyn: My Lords, paragraph 1499 of the Kilbrandon Report identifies five headings where paramount powers might be capable of being exercised. The important rejoinder I would make is that the report states:

    "We would stress our view that an element of opinion and of political judgment may sometimes enter into a decision whether or not the exercise of paramount powers is justified". I believe that the proper way ahead--and I have tried to do so constantly since I took over the responsibility--is to have as full discussions as possible. The islands' authorities have constantly told me that they welcome discussion and recognise that they have their part to play. They ask--and reasonably, in my opinion--that their concerns and troubles shall be heard. As regards the noble Lord's last question, I believe that discussions are continuing.

Lord Short of Stepney: My Lords, the questions could cause great and unnecessary worries in the Channel Islands. My noble friend has said, first, that under our constitutional arrangements we do not legislate in tax matters for the Channel Islands. That is their prerogative and we intend to uphold it. Secondly,

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thanks to a protocol negotiated at the time, the Channel Islands are outside the European Union, and therefore its authority.

Lord Williams of Mostyn: My Lords, the noble Lord, Lord Waddington, asked me specifically about the European Union and I agreed with his description of the constitutional relationship. I repeat that legislation on taxation has always taken the form enacted by the legislatures. We do not exercise jurisdiction over their tax systems. However, we have our own domestic interests which I and my colleagues in other departments try to reconcile with the legitimate interests of those who live in the Channel Islands and the Isle of Man.

Lord Boardman: My Lords, does the Minister believe that taxation could be imposed on the Channel Islands without the consent or agreement of their elected representatives?

Lord Williams of Mostyn: My Lords, life is not so simple. One cannot cut out the quotations because the Kilbrandon Report describes the relationships. I repeat that we have never legislated for internal taxation for the islands. We do not exercise the jurisdiction. We should listen carefully to what they say; they have always been courteous enough to listen to what Her Majesty's Government have to say.


2.55 p.m.

Baroness Masham of Ilton asked Her Majesty's Government:

    Whether they will have enough diabetic specialists to deal with the projected rise of diabetes and its complications in the 21st century.

Baroness Hayman: My Lords, we have announced that we shall be drawing up a National Service Framework for diabetes over the next two years. While it is for National Health Service trusts and health authorities to determine the numbers and grades of staff they need in order to provide good quality services, we shall consider issues of staffing and professional education and training as we develop the National Service Framework.

Baroness Masham of Ilton: My Lords, I thank the Minister for that Answer. Is she aware that about 100 consultants in district general hospitals dealing with this most complex condition, and in sole charge of patients, desperately need cover? Does she agree that there is a need for more specialised dieticians and nurses working within the hospitals and the community?

Baroness Hayman: My Lords, I agree that dieticians and nurses specialised in diabetes are key members of multi-professional teams co-ordinating care pathways for patients and that they need to work across the primary, secondary and tertiary care sectors. We must

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ensure that we continue the training of qualified nurses with post-registration awards in diabetes care so that people are available to undertake that job.

Furthermore, I understand that at the end of September 1997, 297 consultants in England and Wales specialised in diabetes. There has been an increase in the number of trainees, and it is estimated that by 2005 there will be 472 consultants. They ought to be able to provide the cover to which the noble Baroness referred.

Lord Walton of Detchant: My Lords, does the Minister agree that the increased incidence, to which the Question refers, does not relate to Type I insulin-dependent diabetes, but to Type II non-insulin- dependent diabetes, which tends to develop in older people? Does she further agree that one of the major factors responsible is the increasing number of cases in Western society of another disease; namely, obesity? What advice are the Government giving to the public at large about the dangers of over-eating?

Baroness Hayman: My Lords, I believe that the public at large would prefer to take advice from the noble Lord, Lord Walton of Detchant, than from me. He is right to highlight diet, which is important in lowering the risks of obesity and cardio-vascular disease. That applies not only to people with diabetes, but across the population. I am sure that our forthcoming White Paper will, in dealing with the broad public health issues, take account of the noble Lord's suggestions about diet and, I would add, exercise.

Lord Rea: My Lords, does my noble friend agree that one way of reducing the load on diabetic specialists is to develop proper diabetic clinics in primary care and that the nurses she mentioned should play a major part in running those clinics? Furthermore, perhaps I may put in a plug for the Parliamentary Food and Health Forum, of which I am chair. It is holding a meeting at six o'clock this day week on obesity.

Baroness Hayman: My Lords, I am sure that Members of your Lordships' House will have noted the meeting, just as they note the times of the weigh-ins held by the noble Baroness, Lady Fookes, for those of us who wish to lose a little weight. My noble friend is absolutely right to highlight that a great deal can be done in primary care in terms of the care and education programmes for patients suffering from diabetes. Nurses specialising in diabetes lead education programmes to ensure that colleagues who are general practitioners and practice nurses are equipped to care for patients locally.

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