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Baroness Hollis of Heigham: My Lords, it is an extremely technical system. People will need to spend a little time with the documents which have only just become available. Perhaps I may give a simpler example. Let us roll forward to 2003 and assume for these purposes that the basic state pension is £77 and that the minimum income guarantee is £100. Someone has an occupational pension or income from savings of £30. At present, if he had that £30, he would end up with £77 state pension and £30 occupational pension, giving an income of £107. So he would be only £7 better off for his occupational pension than if he was on the minimum income guarantee as he had never saved or contributed towards a pension. That is why, at the moment, the system discourages thrift. In future, if someone has an occupational pension and the full state pension of £77, he will be credited with the MIG level--so he will go from £77 to £100--and then he keeps 60 per cent of his occupational pension. So he will keep 60 per cent of £30, which is, say, £18, up to the figure of £200 for the couple. It means that that person would therefore have £100 plus 60 per cent of £30, which equates to £118, instead of the original £107.
For that extra £30 he will receive a full £18 extra and more than he would have received under the existing scheme. That is why we believe that it is so much more generous to people who have a modest occupational pension; and, as I said, two-thirds of the gainers will be women.
Baroness Wilkins: My Lords, I wholeheartedly welcome the Government's announcement of an extra £200 million a year for disabled people and carers. That will provide greater security for those disabled people who are unable to work. Does my noble friend agree that in future much greater security needs to be provided for those disabled people who need personal care but who have managed to find work? They feel insecure about the future because they face losing a large proportion of their income to the cost of their care.
Baroness Hollis of Heigham: My Lords, as my noble friend will know, the Government have introduced the disabled person's tax credit. Together with the disablement income guarantee, that will represent a significant increase in the basic floor of income for disabled families. We are talking about a figure of £182 a week for the disability income guarantee. In addition to that, people enjoy, rightly, tax free, as a universal benefit, disability allowance. But I suspect that my noble friend is concerned not so much with those groups on people on low incomes who go into work but who have rather lower care needs, but with those who have severe care needs which are currently being met by the Independent Living Fund. Discussions are underway with the Independent Living Fund. My noble friend has made representations on that subject. So I would suggest that she joins us in those discussions. I am sure that she will be able to make her point very fully and very forcefully there.
Lord Monro of Langholm: My Lords, the noble Baroness did not have time to answer an important question asked by my noble friend Lord Higgins. What will be the increase in the national insurance contribution next year and in subsequent years?
Baroness Hollis of Heigham: My Lords, I did not answer it because national insurance has nothing to do with the Department of Social Security.
Baroness Crawley: My Lords, like many noble Lords, I very much welcome the pension increases, the increase in the minimum income guarantee and the introduction of the pensioner credit. While for some that will not be enough, for very many people, particularly the poorest pensioners who are women, this will be a very welcome package. What are the Government doing to respond to those pensioners who complain, sometimes with justification, that the bureaucracy involved in obtaining benefits is still too much for them? Perhaps my noble friend will take this opportunity to talk about how the Government are approaching the issue of bureaucracy.
Baroness Hollis of Heigham: My Lords, my noble friend is absolutely right. If we are to use a targeted
approach to respond to pensioner poverty, we have to ensure that pensioners who are eligible for help not only know about it but claim it. There is agreement all around the House on that. So far, so good. Around 600,000 people have responded to the campaign for take up. We have processed about 60,000 of those claims and so far half of those have been successful. We will know the full sums only when we have processed all of those claims. As part of our efforts to make more pensioners willing to come forward, we have introduced the new telephone system. People can make claims on the telephone. For the future, once we have carried out what I would call the initial audit of a pensioner's income at the point of retirement, we would hope thereafter to be able to produce a system which is much more user friendly--perhaps much more akin to the tax system--and in which the pensioner will need to notify us only if there is a significant change in his or her income subsequent to retirement; perhaps due to bereavement or inheritance. In that way, with the support, I am sure, of the entire House, we hope to see all pensioners claiming every penny to which they are entitled and which we owe them.City of London (Ward Elections) Bill
4.39 p.m.
The Chairman of Committees (Lord Boston of Faversham): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That this House do agree with the orders made by the Commons set out in their message of 2nd November.--(The Chairman of Committees.)
On Question, Motion agreed to, and it was ordered that a message be sent to the Commons to acquaint them therewith.
Greenham and Crookham Commons Bill
The Chairman of Committees: My Lords, I beg to move the second Motion standing in my name on the Order Paper.
Moved, That this House do agree with the orders made by the Commons set out in their message of 6th November.--(The Chairman of Committees.)
On Question, Motion agreed to, and it was ordered that a message be sent to the Commons to acquaint them therewith.
Transport Bill
4.40 p.m.
Lord Carter: My Lords, I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Transport Bill, has consented to place her prerogative and interest, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.
Clause 38 [Directions in interests of national security etc.]:
Lord Brabazon of Tara moved Amendment No. 1:
- Clause 38, page 24, line 32, at end insert--
The noble Lord said: My Lords, now that the European Commission has referred the legality of the BAA golden share to the European Court of Justice there must be a real possibility that the rights given to the golden shareholder by the NATS articles of association will be rendered unenforceable. On this side of the House, our interest in the rights attaching to the golden share are not in retaining control of the company, but in protecting national security.
The treaty recognises the right to override the provisions as to establishment and free movement of capital in the interests of public security and it is important that the Bill includes full powers for the Government to do, in the interests of national security, what they could have done by exercise of rights attaching to the golden share. In this way, if the rights attaching to the golden share are struck down, at least there will be a comparable power in the Bill for the Government to act on grounds of national security. That should not be challengeable by the Commission as it relies on one of the permitted exceptions.
The powers contained in subsections (1) and (2) of the clause to give directions to a licence holder or holders cover some of the rights attaching to the golden share, for example, those such as issue of shares and appointment or voting rights of directors. But the major protection afforded by the golden share is the right to restrict an individual holding to 15 per cent and, judging by the Commission's press release, this is also the Commission's main target. That right is not covered by subsections (1) and (2) because, if that provision in the articles is found to be in breach of the treaty, the right to claw back any holding in excess of 15 per cent--the only way a licence holder can force a shareholder to transfer shares--will not be enforceable. A licence holder will therefore be powerless to enforce any direction the Secretary of State makes to a licence holder to claw back shares. The power the Secretary of State needs is to direct the shareholder to transfer the excess--or indeed any--shares. The amendment is designed to give the Secretary of State this power.
It would be dangerous for the Secretary of State to rely on provisions in the partnership agreement. There is nothing in the wording of the relevant treaty provisions to suggest that a partnership agreement is immune from attack by the Commission any more than articles of association. In any event, if there were a subsequent flotation--and the provisions of the articles of association are clearly geared to provide protection in that event--any safeguards in the partnership agreement will fall away.
It would be equally dangerous for the Government simply to sit back and say they will fight off the challenge by the Commission to the comparable provisions in the BAA articles. The duty of the Government is to make proper provision in the Bill to safeguard national security in the event that the European Court rules against the United Kingdom in the BAA case. At present, there is a yawning gap and this amendment is intended to fill it. I beg to move.
The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Lord Whitty): My Lords, I understand the objectives of the noble Lord in moving this amendment. However, we have already made clear that it is the duty of the Government to safeguard national security and the amendment would not override that. It is not simply the golden share which safeguards national security in this structure.
We have taken great care to ensure that national security is protected throughout the PPP proposals. It may be helpful to the House if I set out the different layers of protection for national security which are already in place. Clause 38(2) of the Bill provides that the Secretary of State may, at any time, give such directions to a licence holder as he considers necessary in the interests of national security. Clause 94(1) provides that the Secretary of State may give directions to any listed person in any time of actual or imminent hostilities or of severe international tension or of great national emergency.
Clause 28 provides that the Secretary of State may apply to the court for an air traffic administration order, so that an administrator can take control of the assets of a licence company in various circumstances. Such circumstances include a situation where the company has been or is likely to be in contravention of the Section 8 duty to provide a safe system for the provision of air traffic services, or where the company is, or is likely to be, in breach of an enforcement order. In either case it would be inappropriate for that company to continue to hold its licence.
In the licence, schedule 3 provides for its revocation in various circumstances, including, first, where a licensee fails to notify the Secretary of State of any change, transaction or arrangement of which it becomes aware which would enable a person or group of persons directly or indirectly to control or materially to influence the policy of the licensee, or would enable that person or group of persons to do so to a greater degree; or, secondly, that such a change, acquisition, transaction or arrangement takes place despite the Secretary of State issuing a notice of objection that, in his opinion, it would be against the interests of national security or relations with the government of another country.
The strategic partnership agreement, which is a contractual agreement between the Government and the strategic partner, will require the approval of government directors for the raising of loans and the acquisition or disposal of material assets. It will
That range of protections deals with the issue of national security. The special share is therefore only one of a network of controls which ensures a high level of protection for the public interest. As the noble Lord, Lord Brabazon, pointed out, the articles of association also provide, under the special share, the principal right to veto certain events, including amendments to certain articles and the issue of any shares by NATS. In addition, those articles will prevent any shareholder, other than the Government and the strategic partner, holding more than 15 per cent of voting share capital. In any case, this will only be of relevance following a flotation of NATS. At present, of course, the Government have no intention of permitting such a flotation.
In addition to those powers attaching to the special share is the further range of protections in relation to national security which are provided in the legislation itself, in the licence and in the strategic partnership agreement. The real motivation behind this amendment may be concerns that the ultimate owner of NATS or of the strategic partner or part of the consortium which forms the strategic partner could at some future date turn out to be unsuitable. It is clear that we have a number of powers under the Bill to prevent them taking action or not taking action which would be against the national interest. Those include acquisitions, buying in and raising loans from sources that would be inimical to the national interest.
Although I agree that the protections offered by the golden share are important and will be liable to any challenge in the European Court, I can also assure the noble Lord that there are several other protections for national security. I hope, therefore, that the noble Lord will not pursue his amendment.
("( ) The Secretary of State may give to any person holding shares in a licence holder a direction requiring him to do or not to do a particular thing (which may include transferring a share or shares in that licence holder to such person and on such terms as to compensation and otherwise as the Secretary of State may direct), if the Secretary of State considers it necessary or expedient to give the direction in the interests of national security.").
4.45 p.m.
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