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22 Apr 2008 : Column 1385

Lord Taylor of Holbeach: My Lords, how does the Minister square the decision to construct a coal-fired power station at Kingsnorth, with no carbon capture or sequestration, with the time that this House has spent on the Climate Change Bill?

Lord Rooker: My Lords, I am in the very happy position that I do not have to, because the application for that power station has been put on hold and deferred.

Lord Teverson: My Lords, is not the issue around the Climate Change Bill and power stations one of carbon capture and storage, as the noble Lord, Lord Taylor, suggested? In the UK, we have one minor-scale competition project for carbon capture and storage in an economy where we have the natural resources in the form of the North Sea, which is naturally ripe for carbon capture and storage. Will we not lose our leadership in this area, as we did in renewable energy, to the rest of the world, particularly to Australia and Canada?

Lord Rooker: Clauses in the Energy Bill, which is in the other place, set out the regulatory framework for carbon dioxide storage. All these issues—both the mechanics in the Energy Bill and the concept of and structure for regulation in the Planning Bill—can be fully debated in your Lordships' House, hour after hour and day after day, with the knowledge of what we have already done on the Climate Change Bill. It will not be too far away.

Lord Elton: My Lords, does the Minister recognise how agreeable it is for an opposition party to hear a Minister say that he has no idea what changes will be made to three programmed Bills?

Lord Rooker: My Lords, elected Members of the House of Commons will scrutinise the Planning Bill and the Energy Bill on Report, so who can say what the outcome will be when they come to this place? No one can. When both Bills come here, they will be scrutinised in line with our normal, high-quality scrutiny procedures.

Lord Redesdale: My Lords, will the Minister support all new power stations being made ready for carbon storage under the Energy Bill? Deferrals of applications should be made not just for coal-fired power stations, because we burn fossil fuels also out of gas. Every new gas power station should also have carbon storage and capture by law.

Lord Rooker: My Lords, I was warned that I might be asked that question, but, because of the deferral of that application, I was told that it made good sense not to make any comment. There is nothing on the agenda. There could be legal ramifications. That planning application is now deferred and on hold, so the issue does not arise.



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Restaurants: Gratuities

2.59 pm

Lord Lee of Trafford asked Her Majesty’s Government:

The Parliamentary Under-Secretary of State, Department for Business, Enterprise and Regulatory Reform (Baroness Vadera): My Lords, restaurants, like any other business, operate a wide variety of practices in relation to tips. The Government do not regulate them in detail, with one exception: every employer must pay their workers the national minimum wage. Tips may count towards the minimum wage only when they have been paid through the employer’s payroll.

Lord Lee of Trafford: My Lords, I am grateful to the Minister for her reply. Is it not clear that a minority of restaurants operate a dishonourable scam by retaining some of the gratuities or tips themselves or, in other cases, actually using the gratuities or tips to top up to the minimum wage? Will the Minister work with the British Hospitality Association to look at this whole question, which is clearly unsatisfactory at present? The association represents 18,000 restaurants. Would it not make sense if restaurants had to display on menus or bills what their policy is with regard to the distribution of gratuities or tips?

Baroness Vadera: My Lords, as the Secretary of State said yesterday, this issue is of concern not only with respect to employees’ rights but with respect to the rights of consumers to know where their tips are going. The DBERR has therefore undertaken to consider the issue and take all representations into account. We will talk to the BHA as well as other stakeholders, including the unions and employers.

I should simply caution that this is quite a complex matter. Tipping does not automatically lead to improved employee wages. In tight labour market conditions, the money does not need to be passed on, because wages can be reduced over time or consumers may stop paying the tips if the employers’ costs go up. It is a complicated issue, but we will consider it.

Lord Elystan-Morgan: My Lords, is it not the situation in law that when these gratuities are received by the management they are held in trust, either for the individual waiter or waitress or for the staff as a whole, in accordance with any agreement made?

Baroness Vadera: My Lords, unfortunately, the law is not clear on that matter, which is why we have said that we will take all representations and consider it. Most restaurants are run on a troncing system in which a troncmaster holds the tips, usually for all the staff both in the front and the back. However, that does not mean that in all cases it is illegal for the tips to be shared by the owners or managers.



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Lord Razzall: My Lords, does the Minister accept that, although certain aspects of the law may be unclear, following the very successful campaign by Unite to draw attention to this issue, if you go into a restaurant and it says on the bottom of your bill, “voluntary contribution to service”, and if your voluntary contribution is in fact a contribution to the minimum wage salary of the member of staff, that is clearly a breach of contract? Is that not something that trading standards officers should be addressing and stopping?

Baroness Vadera: My Lords, the only regulation that actually applies to the disclosure of the service requirement is that customers are required to be told in advance that there will be a service charge if it is going to be automatically added on to the Bill. Restaurants do not currently have to disclose whether that is going to go to staff—and, in response to the Question asked by the noble Lord, Lord Lee, that is obviously something that needs to be considered.

Baroness Prosser: My Lords, I declare an interest as a member of the Unite trade union. Given that Her Majesty’s Revenue and Customs takes into account a notional amount of money earned by way of tips by staff in restaurants and hotels, would the Minister agree that perhaps the best thing is to follow my personal practice, which is always to leave the tip in cash on the table?

Baroness Vadera: My Lords, naturally, I urge noble Lords to be generous in their tipping, but it must be said that it is not the case that every time you leave a tip in cash it automatically passes through to the waiters, because there could be a contractual arrangement that requires it to be passed back either directly to the employers or on through a troncing system. The Low Pay Commission has found a large variety of practices and it is not possible to say that one method is preferable to another.

Viscount Bledisloe: My Lords—

Lord Mackie of Benshie: My Lords—

Lord Renton of Mount Harry: My Lords—

Noble Lords: Cross Bench!

The Lord President of the Council (Baroness Ashton of Upholland): My Lords, we have not actually heard from the Conservative Benches.

Lord Renton of Mount Harry: My Lords, may I suggest to the noble Lord and the noble Baroness in her suggestion about leaving cash that there is an even simpler method of solving this problem? Noble Lords will probably remember that the French word for tip is pourboire. If noble Lords are worried about this matter, I suggest that they buy the waiter a large glass of red wine and leave that instead of money. The proprietor would get the message very quickly.



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Baroness Vadera: My Lords, I am not sure that the waiter’s family would entirely appreciate that if it is relying on the tips.

Lord Mackie of Benshie: My Lords—

Viscount Bledisloe: My Lords—

Baroness Ashton of Upholland: My Lords, we have already heard twice from the Liberal Democrat Benches and once from the Cross Benches, but if both noble Lords are reasonably speedy, both will get in.

Lord Mackie of Benshie: My Lords, will the Minister assure us that all the tips given in this House go to the staff?

Baroness Vadera: I am sorry, my Lords, but I do not know. I shall look to one of my colleagues and get the answer.

Viscount Bledisloe: My Lords, is it not plain that, if I leave money which is plainly intended as a tip and not as a payment to the restaurant and the restaurant takes it to itself, that is not just a breach of its contract with its waiters but is theft of the money and is prosecutable?

Baroness Vadera: My Lords, I completely appreciate the noble Viscount's view. However, the situation is not clear in law because the restaurant could take the service charge as part of its revenue, pass it on to the employee and pay NICs on it. In response to the earlier question, I understand that the answer is yes.

European Union (Amendment) Bill

3.06 pm

The Lord President of the Council (Baroness Ashton of Upholland): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.

Moved accordingly, and, on Question, Motion agreed to.

House in Committee accordingly.

[The LORD SPEAKER in the Chair.]

Clause 1 [The Treaty of Lisbon]:

Lord Howell of Guildford moved Amendment No. 2:

The noble Lord said: The amendment stands in my name and that of my noble friend Lord Hunt of Wirral. We now begin what I fear will be a fairly long process in a complex and very important Bill. I shall make one or two preliminary remarks about the future landscape. A lot of disagreement is ahead—we

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have to face that. We are here to disagree, I hope constructively and amiably, with each other. However, I hope that we are all agreed on one thing—that line-by-line scrutiny of this Bill is required urgently and, indeed, it is our duty to see how it can be improved. That is our job, and what we are here for.

To be a little pedantic, it is not quite correct to say that the Government gave 11 full days in Committee in the other place, as was observed the other day. To put that at its kindest, I regard that as a somewhat digital enhancement of the facts. The truth is that with the themed debates in the other place, each day’s Committee stage was squeezed down to three and a half hours or less, sometimes 90 minutes. As a result, rafts of amendments were never debated, and several very important subjects were never reached at all, such as defence, asylum and immigration, all of which led one commentator to describe the handling in another place as a scandal. I hope that we will not hear any more of that. We have an important job to do—to fill in for what has not been done.

The first amendment is concerned with what could be described as honest labelling or consumer protection-type legislation—namely, presenting the treaty for what it really is. We believe that in the end it pays to be honest with voters and the public. If one tries to get round that it usually comes back to hit one in the face.

I looked in vain—I suppose this was na├»ve of me—for a Liberal Democrat amendment on this issue. I am glad to see that Liberal Democrats are here. However, I have looked for their amendments but cannot see one to any part of this Bill at all. I am amazed that they have not put down a single amendment. They seem to have given up on their proper duty of scrutiny and improvement in this Chamber. I thought that was what they were here for. Therefore, I presume that they will vote with the Government on everything. I hope that I am wrong but it looks as if that is what will happen. It is very puzzling. These days our Liberal Democrat colleagues on my right seem to have become sort of punk Europhiles. They make Gordon Brown’s dithering over signing the treaty and everything else look positively dynamic. I wondered why they abstained and walked out of the Commons. Frankly, I now wonder why they have even bothered to walk into the Lords today if they are not going to play any part in the Bill except to tick the Brussels boxes. Enough of that because it is disappointing but I suppose we—

Noble Lords: More!

Lord Howell of Guildford: I have plenty more here but I shall spare them that.

Let us get to the amendment.

Lord Lea of Crondall: If the noble Lord wants to make points of that ilk, will he tell us what a Conservative Government would actually do, assuming this Bill goes through?



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Lord Howell of Guildford: I certainly intend to do that during the Committee and Report stages of the Bill. We have plenty of things to do. We have a major agenda for improving the European system and for being extremely constructive and pro-European, as this party has always been, unlike the party of the noble Lord who has just intervened.

In moving this amendment I confess that I have an overwhelming, almost eerie sense of having been here before. It is a sort of Groundhog Day experience. This is not surprising because the treaty embodied in the Bill we are looking at includes 96 per cent of the measures in the rejected constitutional treaty. Many of the amendments that we shall move will follow exactly the same track as those tabled by the Government at the time of the initial convention which gave birth to all this process. We shall seek to learn how and why they failed, as most of them did, and what damage the Government believe will be caused by their reappearance in this treaty. That is something to which the public are entitled to know the answers. I hope that we shall get very full explanations from the Government.

It will be contended by some—and has been already—that an amendment of this sort is wrong because the last treaty was not really a proper constitution in the first place. I agree that it certainly was not the tight, limiting and circumscribing constitution that my noble friend Lord Lawson, who is not in his place, argued for on Second Reading, and for which I confess I argued myself some years ago in a book. In my view, which I stated even before the convention was set up, the whole idea of the convention, which was a top-down rather grand affair, was bound to be a disaster. One disaster leads to another so we are where we are now as a result of those errors.

I know that the Government keep claiming that the constitution concept has been abandoned. That is their main claim although the argument comes in two parts. First, it is argued that while the measures are the same—that seems to be admitted—there is no bundling of all the previous treaties into one document, so it cannot be labelled a constitution or even of constitutional significance. No doubt we shall hear that again today. Secondly, it is argued that for the UK it is all different anyway because the opt-outs, safeguards and red lines make it so.

Our amendment challenges both these contentions and seeks to ensure that the Bill states the truth from the outset. First, it is by no means necessary for all measures to be in one document for them to have deep constitutional significance and implications and to convey new constitutional arrangements, as our amendment suggests. As I said on Second Reading, every schoolchild knows that the unwritten British constitution exists outside the boundaries of one document and always has; and just because the wrapping has changed it does not mean that the contents have changed. In the words of Angela Merkel, the German Chancellor,

in the Lisbon treaty—



22 Apr 2008 : Column 1391

3.15 pm

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