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Lord Campbell-Savours: My Lords, I regard this legislation as the most important I have had to vote on in all my 25 years in the Palace of Westminster because, while I support the Bill, I recognise that it changes the relationship between the state and the individual—in my view, in a very positive way. That is why—this brings me to a criticism of what has happened—I lobbied very aggressively inside the Government prior to the Bill being announced, when David Blunkett was Home Secretary, to make sure that it was not dealt with by a Select Committee in the House of Commons but by a Joint Committee of both Houses.
I believe that the arguments put forward by the noble Earl, Lord Erroll—who clearly has a very wide knowledge of these subjects—should have taken place inside that Joint Committee, drawing on the expertise of many other Members of this House who, within their particular areas on this Bill, have argued in detail. We should have had the opportunity in Joint Committee of pressing those details to conclusion. I believe that that would have avoided much of the debate which is now taking place in the House.
Secondly, the whole debate has gone topsy-turvy. The reality is that, in the event that the noble Baroness, Lady Thatcher—who is in her place today—was still Prime Minister, a Conservative government would be introducing this Bill. Many of us treat this legislation as utterly inevitable. Therefore, behind the scenes there always was a consensus that we would move down this route. That brings me back once again to my view that we should have had in place a Joint Committee arrangement to allow the best minds in the land in this institution of Parliament to consider these matters.
In my view, it is still not too late, despite the amendments that are being moved this evening. There is still room for an ad hoc arrangement to be established as the legislation slowly makes its way through departments in the period of implementation. I appeal to my noble friend please not to rely uniquely on the skills of civil servants to deal with these matters. We are simply discarding the huge expertise that is available and the ability of Parliament to ask questions on the minutiae, which might well, during the period of implementation, affect what final decisions are taken.
Finally, I return to an issue that I raised on a previous occasion when we debated similar amendments to the Bill—the tax take. I believe that, as my noble friend would probably accept, a lot more work could have been done on the whole area of estimates. Clearly a lot more work could have been done on the area of benefits. There will be a vast increase in the tax take, as I keep saying. I just wish that those who pontificate on these matters on
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television and go on about costs would start referring to the increased benefit to the taxpayer arising from the Bill. We should not be fearful of the electorate in addressing the matter in what might appear to be a fairly aggressive way in relation to the tax debate. There is a gain to be made. I think that, in the event that we have a further opportunity to scrutinise these matters, that benefit should be clearly assessed—yes, with great difficulty, as we are measuring the black economy—and become part of the very important debate that will take place.
Lord MacGregor of Pulham Market: My Lords, this is the first time that I have taken part in debates on the Bill, although I have been following them closely, in particular the debate on 19 December when, in Committee, we looked at the whole cost question. I warmly commend the speeches of my noble friend Lady Noakes and the noble Lord, Lord Phillips, on that occasion.
I say to the noble Lord, Lord Soley, that I have for some time been in favour of the principle of identity cards. However, that support has been dependent on two things. The first is the exact shape of the project and, in this case, its scale and complexity, which are unrivalled—he mentioned identity cards in other countries, but I say to him that this project has never been duplicated elsewhere. The other concern is costs. I speak not just as a former Chief Secretary in saying that I think it very important that we should understand the costs. If the costs strongly outweigh the benefits, a big question mark is raised in my mind over whether we should proceed.
Lord Soley: My Lords, I am very pleased to hear that and I am with the noble Lord so far. He will know that I indicated that the issue was really the technology and the cost, which I think is what he is saying. If so, will he kindly explain to us all how on earth the amendment meets that problem?
Lord MacGregor of Pulham Market: My Lords, I was going to go on to do precisely that. If that is a way in which the noble Lord is happy to approach the matter, he should support the amendment, which says that, at a later stage—when the Bill has passed through the House and a lot of the details of the identity card are known—the measures will not be implemented until a proper analysis has been done by the House of Commons and possibly by the Select Committee on Procedure, to which he referred. I will also say something about what the noble Lord, Lord Campbell-Savours, said about that, which seems to fit in with this amendment. What the noble Lord, Lord Soley, just said should cause him to think again and perhaps to support the amendment.
I say to the noble Lord, Lord Barnett, that as another former Chief Secretary I understand very well his point about estimates. However, the point is that the Government have given an estimate that is so widely different from the other estimates in public that it is absolutely right for us to probe and test it. The
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problem is that we do not have any of the details; we just have a global figure from the Government, so we cannot test it properly unless we go through the process that Amendment No. 123 recommends.
Let me touch on one or two points that concern me about the Government's figure. I shall take the figure not of £584 million but of £187 million, because the Minister said in previous debates that a lot of the cost would be incurred anyway to introduce the new passports. We are talking about an estimate of £187 million to introduce a new project way beyond passports, and I frankly do not believe it. Perhaps the LSE estimate is too high, but the figure must be somewhere in-between.
Let me give some reasons why I need further details. The first concerns cost overruns. The noble Lord, Lord Wright, referred to an IT project in the Foreign Office. We all know the number of cost overruns that have been undertaken on major projects by governments of both political persuasions. The Scottish Parliament is an obvious example, but there are so many examples in IT and many other areas that there will undoubtedly be a cost overrun. What is the Government's estimate of what the cost overrun should be? I believe that there is a contingency fund of 20 per cent, although I had to dig that information out. Is that right? If it is only 20 per cent, I do not believe that that is an accurate figure for the cost overrun. We need a lot more detail on that score.
On the capital costs, we are told that included within the figure of £187 million there is depreciation and interest on capital. How can that be incorporated within £187 million? Perhaps it can be, but we want to see the details. How much of the capital cost will be undertaken under PFI? I have been a strong supporter of PFI in principle and in practice, but there comes a point, just as with a company—because this is effectively off-balance-sheet financing—that if there is too much off-balance-sheet financing, the whole project is threatened because there is not the cash flow to pay for it. I believe that that is beginning to happen with PFI too. I was interested to see today's report in the Times that the Government are getting very concerned about the number of PFI projects with hospitals because there will be a substantial overrun. I think that the Treasury has woken up to the risk of undertaking too many hospital projects under PFI too soon. Will we find that there is some PFI element in these estimates? Are they realistic, and is it not likely that that will be challenged?
The noble Lord, Lord Campbell-Savours, mentioned benefits, and I very much agreed with him. In my analysis, it is important that at least the costs do not substantially outstrip the benefits. The problem is that we do not have any real information from the Government on what they think, quantified, the benefits will be. In response to the KPMG review, which recommended more work on benefits, the Home Office summary of work in progress said:
"A great deal of work has been undertaken with other departments to ensure the benefits for the scheme are quantified".
I do not know whether that includes the Inland Revenue, as it used to be called, but certainly I take the point of the noble Lord, Lord Campbell-Savours. If a great deal of work is going on, why is Parliament not being told? Why is Parliament not being given these figures? If they cannot be completed yet, it makes sense to have them looked at in the terms of the amendment when we come to the stage when it would be operational.
The noble Lord, Lord Phillips, spoke of the costs across government and not just in the Home Office. That must be right as well. I find it difficult to believe that the Treasury is not concerned about the implications of an identity card for all sorts of departments and is not already asking the departments what the likely cost will be. Substantial costs will be at the expense of other projects that the department might otherwise have undertaken in social security, education, and so on. I see the noble Lord, Lord Barnett, nodding. The Treasury has been very remiss if it has not been doing that kind of work.
I find it alarming that all we are being given are the Home Office figures, without any indication of the others. I therefore very much agree with the noble Lord, Lord Phillips, in that respect. If the Treasury has been doing the work, why can't Parliament be told as well?
The Government have relied quite heavily on the fact that the KPMG review has given a fairly good response to what the Home Office has so far undertaken. In fact, they have rather relied on the KPMG report; instead of us being able to examine the estimates, we have to take it on trust that KPMG has done the work. Many of us have been at the receiving end of accountancy reports on a number of projects. I commend the Home Office for embarking on the KPMG report; it was obviously important and necessary to do so, but it is limited.
4.30 pm
We are all used to these reports. This one was completed in a month. Most of them are completed very quickly by accountants. They are reliant on the information given by the department that sponsored it, and as such they are a test of process.
The KPMG report makes clear that it was very limited in scope. It did not cover by any means all the cost estimates being considered. It certainly is not a ringing endorsement of the cost figures. We should be quite clear about that.
I have not yet been able to read the new LSE report, although I have seen the foreword by Sir Howard Davies, which makes it very clear where it still stands. In spite of all the criticisms, it holds its ground. The LSE report gives details, which has enabled the Government to question some of its assumptions. A number of us have seen the detailed government questioning of some of the assumptions of the LSE report.
The Government, however, are not giving any details of their own estimates, so preventing others from doing to them what they are now doing to the
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detailed LSE review. All we are asking is that, on the basis of the LSE review, which all of us have seen, we should be able to test the Government's much more limited estimate in the same way. That is what Amendment No. 123 does, and it is why I support it.
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