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The Government’s response will be a test of the Prime Minister’s commitment to improving public confidence in our institutions. Gordon Brown has a choice. He can surrender his powers to appoint life Peers to an independent statutory commission, while still retaining the right to propose candidates to that commission—and do so without much delay—or he can join the long list of Prime Ministers who prefer to prevaricate and keep their powers of patronage. The Government have yet to give a clear lead.

Replying to the debate in July, the noble Lord, Lord Hunt, said that the Bill of the noble Lord, Lord Steel, could emerge from another place in a different shape from when it left here. That is the way of all legislation. It applies as much to Commons Bills which come here as to ours which go there—perhaps more so. We have a sharper eye for detail and we like to be helpful.

If we are frank, the prospects for all-party consensus on the wider issues of Lords reform are unlikely to advance in the run-up to the next general election. The Lord Chancellor may want a big-bang reform that creates a new revising Chamber. But there was nothing in the Queen’s Speech about it and I shall not hold my breath next year either. It could come in the fourth term of a Labour Government or, from what we are told, in the third term of an incoming Conservative Administration. Whether the option is for a House that is 80 per cent or wholly elected, either way it is unlikely to be soon.

While we wait, public confidence in the way we are governed plummets. New Scotland Yard failed to unravel the mysteries of Downing Street’s patronage system, but we cannot afford another scandal over alleged abuses in high places. It is bad enough that departments of state and government agencies are accused of “not being fit for purpose”. This House must not fall foul of that charge because of the way Peers are selected. It is a tribute to our effectiveness that our reputation remains as high as it is despite some noises off-stage. It reinforces our determination to do our duty within the timescale of this Parliament, whatever the future holds. This Bill is proof of that resolve.

I very much hope that the Government will not respond in the way that Alice was fobbed off during her journeys through the looking glass. She was told that she could not have jam today because:

She said that it was nonsense; so will the country if the Government bury this Bill. It is in line with the Government’s own ideas outlined in 2003 in that it allows us to move towards a new era, which we are constantly being asked to do. Some of its proposals may be unduly optimistic. I doubt whether many long-term absentees will formalise their non-attendance by retirement. I tend to place more weight on the proposed powers to strike them off our books if they persist in absenteeism. My parish council does not

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tolerate absenteeism, and nor should we, but those details can be worked through in Committee. I welcome the area of the Bill that allows the remaining hereditary Peers to leave us naturally, on a timetable determined by a higher authority. It is a totally sensible proposal.

We live in a time of constitutional upheaval and greater demands for change in every part of this United Kingdom. Some of it I welcome, particularly in Northern Ireland. Elsewhere, let’s face it, the jury is out. This Bill proceeds with caution. It is a constructive formula for obtaining a realistic reform of this Chamber and I commend it to the House.

10.58 am

Lord Oakeshott of Seagrove Bay: My Lords, I hope that my speech will not be considered in the light of the very diplomatic phrase of the noble Baroness, Lady D’Souza—“so unclear as to be unallocated”. I should make it clear that I am with my noble friend Lord Tyler, the substantial majority of Peers on these Benches and the overwhelming majority of our friends in the other place in supporting a wholly or mainly elected House.

Having said that, my noble friend Lord Steel has done the House a considerable service by bringing forward his Bill, which highlights many of the absurdities of the current situation. I want to focus particularly on a case which highlights the problems of a non-statutory Appointments Commission to which people can give the most clear and solemn undertakings and then cock a snook at them. I particularly want to draw attention to the annual report of the House of Lords Appointments Commission and the letter written by the noble Lord, Lord Stevenson, drawing the attention of the Prime Minister to this case. The report says:

The noble Lord, Lord Laidlaw, has now taken leave of absence, but that makes no difference to the undertakings that he gave the commission. As we have made clear about the present situation, he can simply end his leave of absence at any time and pop over from Monte Carlo whenever he likes.

What response has the previous Prime Minister or the new Prime Minister made to that very important letter from the noble Lord, Lord Stevenson? Has it got lost in the in-trays between Prime Ministers? If no response has been made, I ask this to be urgently considered and responded to.

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I have twice introduced in this House a Life Peerages (Residency for Taxation Purposes) Bill to stop tax exiles being nominated for peerages. Now it is time to finish the job. I will move amendments in Committee to disqualify from membership of the House any Peer who is not both resident and domiciled for tax purposes in the United Kingdom. To vote on this country’s laws, you must pay tax on exactly the same basis as the overwhelming majority of straightforward British taxpayers. “No representation without taxation” is the principle that we should adopt. Do the Government agree with that principle? Will they support my amendments to achieve it?

11.02 am

Lord Strabolgi: My Lords, I am sure that we are grateful to the noble Lord, Lord Steel, for introducing the Bill. In spite of the powerful speech of my noble friend Lord Richard, I hope that it will make more progress than the previous Bill. I agree with Part 1, which puts the Appointments Commission on a statutory basis. I also agree with the provisions of Clause 5, which include,

I consider that to be absolutely essential. The great majority of Peers, of course, fulfil that requirement, but I am sorry to say that a small number do not. As Sir John Major said, once their backs touch those Red Benches they are off and we never see them again. I take particular note and agree with what the noble Lord, Lord Oakeshott, said, who I am glad to follow. It is surely right that this undertaking should be put on a statutory basis.

Clause 10 closes off the by-election option for replacing hereditary Peers who have died. Although the 92 include the Leader of the Opposition, several shadow Ministers, and hardworking Peers on all parts of the House, the idea of the hereditary peerage constantly replenishing itself, sometimes with tiny electorates, has been much criticised. Although I am an elected hereditary Peer, I had the privilege of being elected by the whole House as a former Deputy Speaker. The time has now come to cut off this system, although I realise that the provision causes strong feelings.

I consider Clause 13 on expelling a Peer from membership of the House if they have permanent leave of absence to be rather draconian. It may be that a Peer who has been a regular attender has been posted abroad on official business. He might have been sent as a commissioner to Brussels, for example, or he might be recovering from a lengthy illness. It seems rather unfair if they have to go cap in hand to make their excuses to a body stipulated by the House, which then decides whether,

“the provisions” relating to expulsion from the House.

In conclusion, I hope that one day we shall have an elected Chamber where the Members are called senators. That would take care of many of the problems connected with the peerage that we have, regrettably, seen in recent years and which continue. The Bill attempts to

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put right some of those problems. It is a useful interim measure until we have the full-scale reform that I hope will not be too long in coming.

11.06 am

Lord Baker of Dorking: My Lords, I have long been a supporter of a part-elected, part-appointed House. That dates back to when Margaret Thatcher was Leader of the Opposition and she appointed me to a committee under Alec Douglas-Home to come up with proposals to reform this House. We came up with quite a good package: part-elected, part-appointed, part-hereditary. Alec had an ingenious method for culling the hereditaries. It was a Scottish system, whereby all the Scottish Peers would go to the Assembly in Edinburgh. Lord Stair would take the chair as the oldest and all the names would be read out in alphabetical order, receiving the acclamation “Yes” or “No”. During that process, various derogatory remarks would be shouted out, such as, “No, we couldn’t have him, he cheated at Eton”. That was not the system that was eventually used for culling the hereditary Peers, but they were culled. Margaret did absolutely nothing about that report. The only comment that she ever made to me about the House of Lords was that she was rather sad that the people whom she appointed to take the Conservative Whip rarely supported her. She wisely did not do anything on constitutional reform.

We should now park the possibility of a part-elected House for a number of years. I say that to be realistic. The Government do not have time to bring in a Bill. Whatever the White Paper says, it is academic; it really is for the birds. The Government have neither the power nor the time to implement it. Come the next Parliament, a small majority one way or the other way will lead to a hung Parliament, so there will be no constitutional measure in the next Parliament. It is absurd to believe that there will be. The hustings are not remotely interested in reform of the House of Lords. You get not to 2010 but to 2015. By then, a whole new factor will have entered the debate; by then, this House will have to recognise that it has two roles. It is the upper Chamber for England, because we no longer have any influence on Scottish, Welsh or Northern Ireland matters. It is also a federal Parliament for non-devolved matters. That is very strange body indeed. It will lead to a great debate on who should be the Members of that extraordinary body. I do not believe that there will be fundamental change to the composition of this House for 20 years.

Therefore, I conclude that there should be small, incremental change. I support entirely what the former Speaker of the House of Commons said in her very wise speech. This is a small, incremental measure that will make this House better. I strongly support an independent Appointments Commission and I strongly support the idea of phasing Members out slowly. Those who speak in favour of an elected part of this House have a wish list.

Let me say one thing about leave of absence and the size of the House. When the hereditary Peers were Members of this House, there were 1,200 to 1,300 Members. When they left, that fell to 600. We have

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now expanded to 700. The Appointments Commission is a ratchet for increasing that. The Reaper takes only 17 of us a year, but the commission will appoint more than 17 a year—and in the year after an election probably rather more. There must be a system for descaling the House. We do not need 700 Members, rising to 800 Members.

I would like the measures in Clause 12 to be slightly strengthened. I advocate a system whereby all new life Peers should be appointed for 15 years and existing life and hereditary Peers should be offered either another 15 years or compensation. We can certainly determine compensation for this House. The department with responsibility for environmental affairs has devised an extraordinarily generous system of compensation for disposing of middle-ranking and senior civil servants. If we put our mind to it and use the right actuaries, I am quite sure that we can do the same.

I very much support this Bill. Perhaps I may say to my Front Bench that I hope that the leader of the Tories in this House will go to the shadow Cabinet and persuade it, too, to support the Bill in the Commons. This is all that we are going to get, so let us take it.

11.10 am

Lord Bilimoria: My Lords, above our heads are the statues of our founding fathers—men who emerged from the dark ages with ideas that in time would light up the world. Through Magna Carta they established the Common Council, which later became the Great Council, England’s earliest parliament. The small seed that they planted grew into a tree and from that tree there has now grown a forest of parliaments around the world that share a common heritage.

Our Parliament has evolved in the past eight centuries and, in particular, our House of Lords has become the diverse Chamber in which we sit today, as my noble friend Lady D’Souza said so clearly. Change did not happen overnight. Countless small steps over hundreds of years have ensured that this House has remained relevant to the needs of the country and respected by the people whom it serves. Today marks yet another step along that road of reform.

I said that this House is respected, but there can be little doubt that its reputation has been severely undermined by recent events, as my noble friend Lady Boothroyd said powerfully. If this House wants to regain the public’s confidence and if it yearns for the stamp of legitimacy, yet wants to challenge the popular misconception that legitimacy flows only from direct elections, we must ensure that the public have total confidence in the way in which Members are appointed to this House. That is why I welcome the Bill.

In all fairness, this Government deserve recognition for establishing the House of Lords Appointments Commission. From personal experience, I know of the time, effort and care that members of the commission put into finding and vetting candidates for these independent Cross Benches. They have delivered to this House many world-class experts whose contributions we would never benefit from but for the system of

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appointments. Despite its success, however, we must bear in mind the fact that the Appointments Commission remains a non-statutory body with a very narrow remit. It is the Prime Minister, not the commission, who determines how many Members are appointed to this House. It is the Prime Minister, not the commission, who determines the balance between the political parties in this House. And it is only the Prime Minister, not the commission, who can recommend individuals from political parties for life peerages to the Crown.

The proposal in this Bill that all recommendations for the creation of life peerages shall be made only by the commission is an idea whose time has come. The Prime Minister should not, in a modern democracy, be able to decide how many people are appointed to scrutinise government and revise legislation. Nor should he determine the political balance of the upper House if the House of Lords is to remain a powerful check and balance on the power of government. This Bill not only proposes to remove these powers from the Prime Minister, but would require the Appointments Commission to guarantee that no party enjoys an overall majority in this House.

Tuesday was the first anniversary of my maiden speech in this House. In the short time that I have sat on these Benches, it has convened for close to 1,000 hours. Peers have asked Her Majesty’s Government more than 5,500 Questions and debated issues simply too numerous to count. But the issue that I regard to be the most important is the one that we are debating today, because the public’s confidence in this House underpins everything that we do here in the service of our country. Any misunderstanding of how we are appointed—any perception, right or wrong, that our selection process is open to abuse—undermines the important work that we do.

I applaud the noble Lord, Lord Steel, for his Bill. I am proud that it recognises that the strength and foundation of this House lie in the independence, objectivity and integrity of its Members. I am proud to serve as a Member of this House. This House is precious. This House brings out the best in Britain and this House is also the best for Britain. The House of Lords is the guardian of our nation, the guardian of the values and principles for which we stand and the guardian of the very foundations of this country. May these reforms serve this House as well as this House serves our nation.

11.15 am

Baroness Thornton: My Lords, while I of course congratulate the noble Lord, Lord Steel, on the introduction of this Bill, I am opposed to it, not because I do not agree with at least one of its proposals—eventually to remove the remaining hereditary Peers—but because I am profoundly opposed to its proposed method of appointing life Peers. As a matter of principle, the idea that nine people, be they ever so good and ever so great, should be responsible for deciding who should be the Members of our legislature is no longer appropriate in a modern world.

However, I oppose the Bill largely because its time has passed. It is not quite like rearranging the deck chairs on the sinking ship, as that would be too cruel

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an analogy for your Lordships’ House. Perhaps closing the door after the horse has bolted would be a more apt description. The horse that has bolted in this case is the vote in the other place earlier this year that said in clear and unequivocal terms that your Lordships’ House should either be wholly elected or that a majority of it should be elected. This decisive vote has been welcomed by the Government and by the main political parties. The Green Paper The Governance of Britain, published in July 2007, stated that the Government will develop reforms for a substantially or wholly elected second Chamber and that the cross-party discussions led by my right honourable friend the Secretary of State for Justice will seek to bring forward a comprehensive package of reforms. I agree with that and I was in the minority of your Lordships who voted for a substantially or wholly elected Chamber earlier this year.

In preparing for this debate, I went back to the debates of 1999, when I sat through almost all the hours during which your Lordships’ House was debating what we, and certainly I as a very new Member, thought would be the first stage of reform. I believed that the second stage would surely soon follow. I am older now, certainly; whether or not I am wiser I leave for others to judge, but I have come to realise that reform of this Chamber is not and never will be easy. Since 1997, we have had a royal commission, two Joint Committee reports, four government White Papers on Lords reform and now this Private Member’s Bill.

While I disagree with the Bill, I commend the noble Lord, Lord Steel, for trying to find a way to edge forward in the further reform of your Lordships’ House. However, there is no doubt that, willy-nilly, we have over the past 10 years reformed ourselves and the way in which we conduct business. For example, we elect our own Speaker. In my view, we need more elections to important committees in this House—and why not? But I digress. Because of the accumulation of internal and external reform, there is no doubt that we are a more confident and businesslike House than we were, we are taken more seriously by the Government and, if the number of organisations that beat a path to one’s door is an indication, we are taken seriously by many organisations and groups that seek to influence our deliberations.

However, I do not believe that, just because this House does a good job, that justifies efforts to continue our existence or our composition as it currently stands. With respect to my noble friend Lord Lea, who is not in his place, I believe that he is mistaken. There is no consensus in the Labour group about how this House should be reformed and I regret to say that he is completely out of step with his own party policy and manifesto.

We have hereditary Peers and we have an absurd by-election system to replenish them. The methods of appointment of the rest of us are not easily understood or justified. We have just emerged from a period of examination about how we are appointed, linked to a suspicion that some may be here because they donated or loaned money to a political party. Like many noble Lords, I spend some of my time explaining to others the work of this House—to schools, students, women’s

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institutes and political gatherings. I can assure noble Lords that the recent police investigation and discussions have damaged all of us. When one links the unhelpful publicity to what it is like attempting to explain to a crowd of 18 and 19 year-old students the composition of the House, with its Bishops and its hereditary Peers, and how the rest of us got here, the lesson is salutary. There is disbelief, amusement and incomprehension. There are questions about why we have the established Church sitting as of right in our legislature, when the only other country in the world that has such a system is Iran.

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