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Lord Lea of Crondall: My Lords, perhaps I may help my noble friend the Minister. Why should explaining the reasons for the Government's avowed support for the principle of membership of the euro be taboo?

Lord McIntosh of Haringey: My Lords, what I have said is that the decision is whether it is in the national economic interest and whether the economic case for joining is clear and unambiguous and I have nothing to add to that. The evidence that we have of the disruption in exchange rate markets when people tried

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to do that in the past couple of months is clear. That is not allowing the arguments to go by default. We have taken very seriously the preparation side of "prepare and decide".

Lord Tomlinson: My Lords, I am grateful to my noble friend for giving way. We are agreed in principle, subject to five economic tests. Can he tell us the benefits of having agreed? That is what my noble friend Lord Lea is looking for. If we have agreed in principle, there must be a reason for agreeing in principle. Can we at least say what are the benefits?

Lord McIntosh of Haringey: My Lords, if and when the time comes when a recommendation is made by the Government to Parliament and to the people of this country, we shall be ready to act on that recommendation and on the decision of the people of this country.

There are two other issues which I do not think I need refer to. On the issue of a framework for informing and consulting with employees raised by the noble Lord, Lord Northbrook, a political agreement was reached at the Economic and Social Policy Council on 11th June, but it now has to be given a Second Reading by the European Parliament. Amendments to it can then be tabled. Whatever changes are made to it, information must be given and consultation has to take place at an appropriate time and at the relevant level of management. So there is no question of what the CBI, according to the noble Lord, describes as a "single approach". It says that there is no single right approach. I do not think that is what is proposed at all.

I turn finally to what is a properly pervading theme of this debate; namely, the issue of public services. I start from a very different theory from that advanced by the noble Lord, Lord Blackwell. He referred to "crowding out theory". I thought that he was going back to pre-Marshallian economics, but we had a debate on the Front Benches as to whether he was really going back to Ricardo or Nassar senior. The noble Lord does not seem to recognise that there is any investment element in public expenditure at all. It would be an equal fallacy to claim that all public expenditure is investment. Clearly, that is not the case. But the noble Lord has taken us back a considerable period, not only into the last century but into the previous one.

A number of speakers, including the noble Lord, Lord Roll, and the noble Earl, Lord Russell, have rightly said that the interaction between public and private is not ideological. The Prime Minister has always said--and this is not claimed as controversial--that there is no ideology here; he has always said that the criterion should be what works best. It is true that if we are to make genuine improvements in the public services we shall certainly have to reverse the starvation of funds which was the result of pre-Marshallian and other theories under Conservative governments. But it is also true that that is not enough. The questions raised by the noble Lord, Lord

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McCarthy, are very serious ones. The noble Lord quoted the IPPR report. I could quote back to him the report of my noble friend Lord Curry of Marylebone about Tube privatisation which puts a very different complexion on some of the things that he has said. But it is certainly true that when we come to consider the relationship between public and private, we have to consider whether there will genuinely be an injection of private money. We have to consider whether there will be entrepreneurial expertise. We have to consider whether there are under-utilised facilities. All of those are valid questions to which judgment will have to be applied in each case. But that, after all, is the point of not being ideological but pragmatic. However, that almost seems to have become a pejorative word.

Today we announced part of the 2002 spending review. We announced the themes on which we shall investigate initiatives which cover more than one department. Those will reflect the Government's priorities of delivering high quality, efficient and responsive public services; raising productivity in the public sector and outside; improving skills, research and infrastructure; spreading opportunity and prosperity more widely and tackling child poverty and social exclusion. Those are high priorities for this Government. I hope that they are high priorities for all of us.

I said that I would return to the points made by the noble Lord, Lord Saatchi. I shall devote one more minute to that. I was fascinated by his remarks. He made comparisons as regards spending on public services. He gave the impression that that consisted of spending on health, education and transport. But of course in reality spending on public services is net of the reduction in spending on unemployment. Under the Conservative government more was spent on interest on debt than on schools. Now we have taken £9 billion off debt and unemployment and allocated it to schools and hospitals. I am not in any way ashamed of that.

The lowest 10 per cent of the people we are discussing now include a million people who are in work. They are paying taxes, which is exactly what they should be doing; namely, paying taxes and not receiving benefits. The noble Lord talked about the take-up of means-tested benefits. However, I believe that I responded to the point that he made. He mentioned borrowing but steered clear of debate on the tax burden, in particular as regards his famous "independence day", which would cost £50 billion in tax forgone.

Lord Saatchi: My Lords, I am most grateful to the noble Lord for giving way. As regards the take-up of benefits, at the risk of luring the noble Lord onto the rocks of saying something new, will he tell us what the Government have done with the up to £4 billion worth of unclaimed benefits?

Lord McIntosh of Haringey: My Lords, I believe that the relevant table is table B11 of what is still called the Red Book, although it is no longer red. If I am wrong about the table number, I shall write to

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the noble Lord. He does not seem to realise that he refers to the figures of 1998-99. Further, non-take-up of means-tested benefits has been a feature of welfare and social security policy since the time of Beveridge and has always been represented in the national accounts.

I was amused to hear the noble Lord attack the European Central Bank rather than express an opinion on the euro. We all want the European Central Bank to be more transparent. However, let us return to the serious issues; namely, that we have an opportunity to improve the lives of the people of this country in the course of the next Parliament. It will not

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be easy as there are many obstacles to be overcome. We set the scene for that in our first term of office and we are determined to continue.

Baroness Farrington of Ribbleton: My Lords, on behalf of my noble and learned friend Lord Falconer of Thoroton, I beg to move that the debate be now adjourned until tomorrow.

Moved, That the debate be now adjourned until tomorrow.--(Baroness Farrington of Ribbleton.)

On Question, Motion agreed to, and debate adjourned accordingly until tomorrow.

        House adjourned at fourteen minutes past eight o'clock.


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