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Baroness Jay of Paddington: My Lords, as I am sure the noble Earl is aware, the appointments commission's remit is to appoint people to the Cross Benches. If he is suggesting that it would be preferable for those offices to be held by members of the Cross Benches, perhaps his own Front Bench might have different ideas. The noble Earl has a consistent and long-standing record of opposing any change to the membership of this House. I remind him of what he said when the issue of women Peers becoming Members of this House was first suggested. I quote from the relevant Hansard:

He went on:

    "Frankly, I find women in politics highly distasteful".--[Official Report, 3/12/57; cols. 708-10.]

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I suggest, respectfully, to the noble Earl that he would perhaps be more comfortable if he abandoned pretending to be the Earl Canute and recognised that "dot com" and the 21st century have arrived.

Lord Dormand of Easington: My Lords, if the proposal is adopted, how is it likely to affect the right of the remaining 92 hereditary Peers to sit in your Lordships' House? Can my noble friend confirm that it is still the Government's policy that hereditary Peers will not have the right to sit in your Lordships' House? Can she scotch the rumours that their removal might not take place at all or even that we shall have to wait until after the next election?

Baroness Jay of Paddington: My Lords, I remind my noble friend that we are talking about the appointments commission, which will recommend appointments to the Cross Benches. It will not recommend appointments on the basis of party nominations or indeed on any other basis. The Government have always made clear their determination to proceed with the next stage of House of Lords reform. That will be a matter for legislation and not for the activities of the appointments commission.

Lord Chalfont: My Lords, in the light of a remark made by the noble Baroness towards the end of her first Answer to the noble Earl, can she confirm that no requirement will be placed on the noble Lord, Lord Stevenson, to apply any quotas to the selection made from this trawl, whether they be quotas as regards gender, race, religion or any other category?

Baroness Jay of Paddington: My Lords, I do not think that anything I said suggested that I would be in favour of quotas or that the noble Lord, Lord Stevenson, would be required to take that kind of approach when considering the appointments. I am sure that the noble Lord, Lord Chalfont, is aware that in his report of the Royal Commission, the noble Lord, Lord Wakeham, suggested, for example, that not less than 30 per cent of the Members of the fully reformed House should be women.

Lord Hooson: My Lords, can the Minister confirm whether it is correct that the members of the commission chaired by the noble Lord, Lord Stevenson, were themselves appointed after the Government had utilised the services of a firm of headhunters? If that is the case, do the Government intend to extend that system of selection? Might they not even extend it to the appointment of the Prime Minister?

Baroness Jay of Paddington: My Lords, frankly, that reflects a misunderstanding of the assistance given to the Cabinet Office. As I have explained to the House on several occasions, the PricewaterhouseCoopers Executive Search and Selection exercise produced a long list of people who might be interested in serving in positions on the appointments commission. Those

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people were then selected by an independent panel chaired by the Secretary to the Cabinet Office. It had nothing to do with the Government.

Lord Peyton of Yeovil: My Lords, I wonder whether it has occurred to the noble Baroness, who is the Leader of the House, that it might make a welcome change if, from time to time, she were to demonstrate that she had given careful consideration to ideas put forward and expressed by those with whom she does not always agree? If she cared to look back at those who in the past have occupied her position, I think she will find that they enjoyed a reputation for uniform courtesy and civility. It would be nice if she were to emulate them.

Noble Lords: Shame.

Baroness Jay of Paddington: My Lords, I would ask the noble Lord to withdraw his remark that I am discourteous.

Lord Stoddart of Swindon: My Lords, does my noble friend agree that the simplest and most straightforward way of settling the question of who should or should not be Members of this House is to put in place a fully elected Chamber as soon as we possibly can?

Baroness Jay of Paddington: My Lords, my noble friend will know that that is not the position taken by the Government. The Government have accepted the recommendation made by the noble Lord, Lord Wakeham, in the report of the Royal Commission that a minority of Members of the second Chamber should be directly elected.

Lord Strathclyde: My Lords, can the noble Baroness take us a little further and tell the House when the Government will give an unequivocal reply to the question: what is that composition to be? When will the Government make up their mind and come forward with a plan?

Baroness Jay of Paddington: My Lords, the noble Lord, Lord Strathclyde, is aware that, on the part of the Government, there is no intention to delay this matter. As I explained in my reply to my noble friend Lord Dormand, that is a question for any legislation which is proposed.

Universal Bank

2.52 p.m.

Baroness Byford asked Her Majesty's Government:

    Whether there have been any contacts with European Union officials about the legality of government financial assistance for the universal bank recently proposed to assist rural post offices; and, if so, when the first contacts took place.

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The Minister for Science, Department of Trade and Industry (Lord Sainsbury of Turville): My Lords, the European Competition Commissioner was informed on 4th July about the new package of measures to modernise the post office network. As the detailed projects are developed, officials will consult with the European Commission to ensure compatibility with state aid rules.

Baroness Byford: My Lords, I am grateful to the Minister for that reply. However, I am also somewhat concerned. In June, when we discussed in Committee the Post Office Bill, the Government gave an assurance that there was no possibility of not supporting rural post offices. However, I understand that the proposal to set up a universal bank has been made without approval being sought and in advance of legislation that is currently moving through this House. Can the noble Lord clarify matters for me?

Lord Sainsbury of Turville: My Lords, in such cases it is the usual practice to apply to the commissioner, especially when a detailed proposal has been made. That is the normal procedure. We believe that our proposals will be in accordance with the relevant competition issues. Given that the universal bank is to be established jointly with the banks and that it will cover areas where there is an absence of banking services, it is difficult to see that the proposals will infringe on competition policy. However, that is for the European Commission to establish.

Lord Clarke of Hampstead: My Lords, my noble friend will recall the cautious welcome I gave to the concept of the universal bank when we discussed the Postal Services Bill. Is my noble friend now in a position to give us further details of the functions and services to be provided by the universal bank? Have the proposals been progressed to the point where they are ready to be presented to those people who are likely to use the universal bank?

Lord Sainsbury of Turville: My Lords, the broad outline of the services of the universal bank is clear. It will not offer overdraft or borrowing facilities. It will offer basic bank accounts, along with a direct debit facility which will enable many customers to reduce their gas and electricity costs. Furthermore, a cash card facility will be offered to enable cash to be withdrawn from ATMs. The business case will be developed further over the period up to September, by which time details of the services to be offered will be complete.

Baroness O'Cathain: My Lords, can the Minister confirm whether it is true that no informal contacts were made with the commissioner before these proposals were made? Generally, it is the case that ongoing relationships with the Commission allow people, in particular those involved in industry, to gauge the temperature of the water, as it were. It seems rather strange that we do not yet know, at least informally, whether we may be 100 per cent or even

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90 per cent certain that these proposals will be approved. I should be grateful if the Minister could answer that question.

Lord Sainsbury of Turville: My Lords, I hope that I have indicated that it seems clear that the broad outline of this proposal is unlikely to infringe competition policy. I cannot confirm specifically whether informal contacts were made. I shall look into it and write to the noble Baroness.

Lord Bruce of Donington: My Lords, can my noble friend indicate to the House why it should be necessary to consult the European Commission at all on this matter? Furthermore, can he give the House an assurance that the costs of these representations will be included in the impact cost assessment, in accordance with Foreign Office instructions in connection with such matters?

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