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House of Lords

Monday, 26th July 1999.

The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.

Prayers--Read by the Lord Bishop of Bath and Wells.

Baroness Prashar

Miss Usha Kumari Prashar, CBE (wife of Vijay Kumar Sharma, Esquire), having been created Baroness Prashar, of Runnymede in the County of Surrey, for life--Was, in her robes, introduced between the Lord Lester of Herne Hill and the Baroness Pitkeathley.

Lord Bradshaw

William Peter Bradshaw, Esquire, having been created Baron Bradshaw, of Wallingford in the County of Oxfordshire, for life--Was, in his robes, introduced between the Lord Berkeley and the Baroness Thomas of Walliswood.

Pay Agreements

2.49 p.m.

Lord Brooke of Alverthorpe asked Her Majesty's Government:

    What plans they have for encouraging moves towards longer-term pay agreements.

The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Sainsbury of Turville): My Lords, the question of whether pay agreements are arranged on an annual basis or over some other period is a matter for employers and employees to determine in the light of their particular circumstances.

Lord Brooke of Alverthorpe: My Lords, I thank my noble friend for his reply, although at this stage it is not too encouraging. Does he agree that some of the pay settlements reached in the private sector spanning two or three years have been good both in terms of improved productivity and the generation of greater stability for all concerned? When will the Government make a start with similar models in their own area of competence--especially as they have now introduced public service agreements spanning three years?

Lord Sainsbury of Turville: My Lords, there are a considerable number of pay deals in the private sector spanning a number of years; for example, those made by the Ford Motor Company, Rover Group, Blue Circle and British Energy, to name but a few. However, it should be understood that some 90 per cent of all settlements are struck for one year. A number of settlements--about 5 per cent, according to CBI figures--are for less than one year. It is not for the

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Government to say whether those deals have been good for the companies involved. It is for companies and employees to make their own specific pay arrangements. The Government's Comprehensive Spending Review makes it possible for pay to be managed over a longer period than one year by providing greater certainty over levels of funding. That is the role that the Government should play.

Lord Marsh: My Lords, will the Minister accept that many people will be deeply relieved by his Answer? Does he agree that this country's history of experiments, by both parties, to intervene in collective bargaining has been a fairly universal and consistent disaster?

Lord Sainsbury of Turville: My Lords, the thrust of my Answer was on those lines. We have no desire to become involved in specifying the length of any deal. That is for people to decide in the specific circumstances of their industry. There may, of course, be cases where it is entirely appropriate and may lead to higher productivity and better performance. However, that is for companies and employees to decide for themselves.

Lord McCarthy: My Lords, does my noble friend really ask us to believe that negotiations in the public sector, particularly the Civil Service, are between the employer and unions, as though the Government were not the employer? Is it not well known that the arguments that go on every year because the Treasury tries to get a settlement that is below RPI poison industrial relations in the public sector and are the main reason why, as the Prime Minister says, productivity cannot be increased in the public sector?

Lord Sainsbury of Turville: My Lords, clearly one aspect of this problem is the total sum of money available for pay deals. That is a matter which the Government will lay down and have a great interest in, but within those parameters the decision must continue to be that of the employer and employee.

Lord Mackay of Ardbrecknish: My Lords, at the risk of embarrassing the Minister just prior to a reshuffle, is he aware that we on this side warmly welcome his initial Answer and his response to the noble Lord, Lord Marsh? Can he go further and assure the House that the Government have absolutely no intention to interfere in pay bargaining in any part of the private sector, and that the only area in which the Government have an interest in pay bargaining is the public sector where they are the employer?

Lord Sainsbury of Turville: My Lords, I thought that it was absolutely clear from my Answer that we had no intention to intervene; and that will continue to be our policy. I am not embarrassed to be congratulated by the noble Lord. Coming from the noble Lord, that is a great pleasure.

Lord Murray of Epping Forest: My Lords, while not dissenting from the Minister's proposition that employers and trade unions should be left to settle their

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own affairs, does his reply to the noble Lord, Lord Marsh, suggest that he has completely forgotten that there are exceptions? Does he agree that between 1974 and 1979 concerted action by the government, CBI and TUC played a significant part in reducing the level of inflation in this country from 28 per cent--part of which was due to the previous Conservative government--to about 8 per cent? Does my noble friend agree that in some circumstances it has a part to play?

Lord Sainsbury of Turville: My Lords, I am happy to answer questions about the current policy of the Government. I have never felt very comfortable about re-fighting past battles. I am perfectly prepared to accept that there may have been some cases where such action was successful and others where it was not. However, as of today we do not see that as being advantageous.

British Council and BBC World Service

2.54 p.m.

The Earl of Carlisle asked Her Majesty's Government:

    What resources they intend to provide for the British Council and the BBC World Service over the next three years.

The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Baroness Symons of Vernham Dean): My Lords, under the Comprehensive Spending Review settlement announced in July 1998 the British Council received, or will receive, £133.1 million, £136.1 million and £138.9 million for the three years from April 1999 to March 2002, representing a real increase of some 2 per cent in the period over the 1998-99 level. This was in line with the real increase for the FCO as a whole. The BBC World Service received, or will receive, £175.5 million, £174 million and £177.7 million in the same three-year period, a real increase of nearly 3.9 per cent on average on the 1998-99 level.

The Earl of Carlisle: My Lords, I thank the Minister for her Answer, to which I can only respond with the dying words of the first Secretary of State at the Foreign Office, Charles James Fox. On his deathbed he turned to his wife (named Elizabeth) and said:

    "That does not signify, my dear Liz".

Does the Minister agree with me that in the fifth report of the Foreign Affairs Committee of the House of Commons concerned with resources every single witness lamented the fact that the shortfall of funding for the British Council and BBC World Service meant that they would not be able to do their important jobs with as great effect as they should? Does she also agree that next year's CSR bids should put the British Council and World Service to the top of the agenda, and that if the British Council is called upon to assist with reconstruction in the Balkans the extra money that it

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requires should come from the Treasury, not the Foreign Office or the grant-in-aid fund, which is lower now than it was at any time during the previous government?

Baroness Symons of Vernham Dean: My Lords, I thank the noble Earl for his sterling advertisement on behalf of the FCO. However, I did not believe that his initial quote was particularly appropriate. These sums of money signify very much indeed. I am the Minister for BBC World Service, and my noble friend Lady Kennedy chairs the British Council. Everyone always wants more money for their particular parts of government, but the fact is that the money allocated is sufficient for the purposes of both organisations. For example, the British Council is active in new areas, such as the promotion of creative industries, design, film and the spread of good governance and human rights. The World Service is forging ahead with its plans for languages in real audio on the Internet within five years and the introduction of two continuous streams of English programming, one general and one news. I believe that both organisations are able to proceed with their plans and are properly funded.

Lord Janner of Braunstone: My Lords, does my noble friend agree that both the British Council and the BBC World Service provide unrivalled, honourable and honoured service at minimum cost and maximum effect? In those circumstances, can she assure the House that the welcome news that a real increase is to be provided in the next three years is one that will be built upon and there is no need to worry about diminishing payments for such tremendous services?

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