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The whole application process is different and the applicants will face a different working environment. Their applications will have to be perfect from the day that the commission receives them because the process that is laid down will not permit the type of negotiation that has often occurred during inquiries. Indeed, it was not at all unusual for an application to be amended in the course of its development. The application will

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have to be word-perfect when it is sent to the commission, because otherwise it will have the absolute right to throw it out. The amendment is therefore tabled to find out exactly how the commission’s members will be appointed and to give me an opportunity to mention the very intensive training which will undoubtedly be required before the commission can start to function effectively.

Amendment No. 5 offers a different approach to this dilemma, which I introduced when I spoke to the first amendment. If we delete subsection (3), we effectively delete Schedule 1. If we do that, we do not have a commission to worry about. That is taking the ground from under the feet of the noble Baroness, Lady Hamwee, for which I apologise. Her opposition to the Question that Clause 1 stand part of the Bill is included in this group of amendments. I beg to move.

Baroness Hamwee: I was not in the Chamber when, no doubt, plaudits were given to various Members of the House with regard to various positions, but perhaps I may start the Committee stage of the Bill by saying how relieved and pleased I am that the noble Baroness, Lady Andrews, remains in her position. It is such a pleasure working with her and she would have been so frustrated had the effort that she had put into the Bill gone to waste at the very last minute.

I should also congratulate the noble Lord, Lord Dixon-Smith. It takes a great deal to stand still and silent for as long as he did while Members of the House left the Chamber. That performance is quite an art. Like him, I spent some years on a planning committee. It did not drive me to insanity or, if it did, I have not noticed. I thoroughly enjoyed it. I do not start quite from where he does. I was not proposing to say anything about the costs of the new planning commission, although clearly they are an issue.

The substantial issue—there are a lot of amendments—is a short point and a political point: who is to take the big decisions about big infrastructure projects, who will the public believe takes them, and who do they believe should take them? The public will regard the Government as responsible and liable to have the buck stop at their door, with the accountability that goes with it. It is not simply counterintuitive, but literally incredible that these big decisions may not be decisions of government. The argument is twofold. Who should take the decisions and carry the can, and who will be thought to have taken the decisions? On the latter question, the Government argue that the new national policy statements will set the policy framework, but will not pre-empt the IPC’s decisions. We have said that we support the national policy statements and the sorting out of policy away from a tribunal, although we will be debating how much scope the NPSs will leave for the IPC to exercise discretion, but having set the policy context the Government must live with the consequences. The projects are the consequences.

When I was preparing yesterday for this debate, I realised that giving the IPC the right of final decision might not even be doing it any favours, given the context that the Government will set for it. The IPC will certainly struggle to establish a reputation for independence. Given that the national policy statements

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will, by definition, require a project to be permitted, the IPC will have to clock up a string of refusals for the Government to perceive it as independent.

Who should take the decision? On the part of these Benches, there is no question but that it should be the Secretary of State. The policies will be political; the projects will be political; the decisions will be political. If we assume that the IPC has a role, that could stop short of the final decision at two points. One is that the IPC could make recommendations to the Secretary of State—a point that is, in effect, covered by my string of later amendments. I apologise to the Committee that this is more of a Second Reading speech than one going into the detail of the amendments but I do not imagine that your Lordships would want me to go through every clause that essentially is amended in the same way. Alternatively, the IPC could make a decision that was subject to confirmation or, if the Government are more comfortable with the term, “ratification” by the Secretary of State, and that essentially is my Amendment No. 3.

It has been argued that there is no real distinction between those two but I believe that there is. Surely, confirmation or ratification requires less process—proper process, obviously, but less process. From what I have heard, I am not convinced that either of the models would amount to duplicating the work of the IPC. As I understand it, the IPC would be left with the important, time-consuming and difficult job of testing the evidence. That should comprise a very large part of the tribunal’s work, whether adversarial or inquisitorial. If the matter is left for final decision by the Secretary of State, that will avoid time being taken by oral and aural proceedings, which always take longer than something confined to paper.

Above all, the decisions will require judgment. They will require a balancing of policies and interests, and we do not believe that it would be right to give that responsibility to an unaccountable quango. Of course, there is the issue of whether there should be an IPC at all. Why not make use of the planning inspectorate and adapt the procedure—I do not see that there is any inherent reason why the inspectorate cannot use an inquisitorial approach—if it is considered that a different procedure will be better or more economic? It would be inappropriate not to question the establishment of the IPC with whatever powers it may have. However, I am pretty clear that the Government’s position is so entrenched that there is not an awful lot of future in that, which is why I am focusing more on the relationship between the IPC and the Secretary of State.

The point of principle at issue in the establishment of the IPC is: whose is the final decision? We are not talking about technical matters; the decisions will be of enormous significance to enormous numbers of people. They will include decisions between conflicting—even clashing—interests, and they will require judgment and political choice. Therefore, we say that accountability must not be denied: the decisions must be taken by the Secretary of State.

Lord Boyd of Duncansby: I declare interests as a legal associate of the Royal Town Planning Institute and as a solicitor in private practice advising clients on a range of planning matters.

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The challenges that we face are significant and the infrastructure requirements of this country are formidable. If we are to reduce carbon dioxide emissions by 60 per cent by 2050, it is clear that the infrastructure that will be required in the generation of energy—particularly electricity—and for transport will be significant. The speed with which these consenting decisions are taken will obviously be important, as it will be necessary to ensure that the infrastructure can be put in place as quickly as possible. As referred to at Second Reading, there have been delays in the consenting process. Terminal 5 was always given as one of those which took a particularly long time, but delays have occurred with a very large number of other infrastructure projects.

3.45 pm

Amendments Nos. 1 and 3, in the names of the noble Lord, Lord Dixon-Smith, and the noble Baroness, Lady Hamwee, go to the heart of decision-making. I noticed that the noble Lord, Lord Dixon-Smith, referred to the Government not having thought this matter through. With the greatest respect, we have had the Barker and Eddington reviews and a White Paper and these proposals have been around for a long time. Perhaps he does not agree with the conclusions reached, but I do not think that they can be characterised properly as not having been thought through.

It appears to me that decisions on infrastructure can be divided into two broad areas. There are the strategic issues which face this country: do we invest in renewable energy, do we invest in nuclear energy, do we build a high-speed rail link between London and Leeds or, I hope, even to Scotland? This country will have to face up to those kinds of issues and decisions will have to be taken on them. Quite rightly, they are the prerogative of the Secretary of State and, of course, of Parliament, which is what the Government suggest through the national policy statement and the parliamentary process which will accompany the NPS. No one suggests that they should not be done by the Secretary of State and by Parliament.

However, individual decisions which are quasi-judicial and which require, as the noble Baroness, Lady Hamwee, has said, assessment of the evidence and judgments on that evidence are, I believe, more properly and better done by the body charged with assessing that evidence. For example, the local impact of a generating station can be assessed by the Infrastructure Planning Commission and a decision can be taken on that using the national planning statement to determine the decision, unless the local impacts provide otherwise. In my submission, that is the proper way to do it. Through legislation, we have rightly taken away from Ministers those decisions which are and should be independent. The assessment of evidence should be an independent process. I believe that the Government’s proposals aim to do that.

On whether the Secretary of State should take the decision, the noble Baroness, Lady Hamwee, suggests that there is an issue as regards what people expect. I sometimes encounter cynicism about decisions made by the Secretary of State—that they are inevitable, one way or another, because they are supposedly in line with government policy. If one takes a final decision

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away from the Secretary of State and it is made independently, in accordance with the national policy statement, then the strategic issues are set by Government and by Parliament and the individual decision is taken by the Infrastructure Planning Commission. I hope that we will not go down the road of emasculating the IPC. It is important that it is the final arbiter of such decisions and I support the Government’s position on this.

Lord Turnbull: I thank those who produced the Marshalled List for doing so in a way that brings together all the clauses, so allowing us to debate the central issue of whether the commission should take decisions or whether it is an advisory body.

I believe—backed partly by experience for four years as permanent secretary to the Department for the Environment, seared by planning inquiries such as NIREX waste disposal and Terminal 5—that that should be resisted and the existing provisions of the Bill be supported for reasons of both principle and practice.

What might those reasons of principle be? The noble Lord, Lord Dixon-Smith, said in his speech at Second Reading, and repeated in similar words today:

“The public accept the results of planning decisions ... because a decision is taken by a politician”.

He went on to say that there should be a,

“democratic final point of decision”.—[Official Report, 15/07/08; cols. 1167-68.]

That sounds self-evident, but there are problems with it. The first problem is that, as the noble Lord, Lord Woolmer, recognised at Second Reading only a few months ago, the noble Lord’s colleague, Lord Taylor of Holbeach, suggested exactly the opposite: that the Committee on Climate Change should be made a decision-taking body, not an advisory body.

The more fundamental problem is that that doctrine is just not true; it is a fallacy. There are huge swathes of public life where Ministers and Parliament create a framework and then stand aside from decisions affecting individual citizens. For example, let us take the courts. Parliament decides what is an offence and, broadly, the penalty that should be attached to it. Individual cases and penalties are decided by the courts. The same applies to the resolution of disputes, whether in courts or in tribunals, whether between citizen and citizen or between state and state. Ministers and Parliament decide the rate of tax and what should be taxed and the Commissioners of Revenue and Customs decide how much an individual taxpayer should pay. Ministers come nowhere near those decisions. The Monetary Policy Committee was cited earlier in debates on the Climate Change Bill. Ministers decide what the inflation target is and the MPC makes operational decisions.

The Competition Commission is now a deciding body—except, as we have seen recently, in very exceptional cases. You could say the same about admissions to schools and hospitals, arm’s-length grants to arts bodies. In huge swathes of life, exactly the opposite principle from that which is being argued for here is followed. It looks as though decisions on, for example, immigration and asylum may be the exception rather than the rule.

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Planning is something of a hybrid, with decisions being taken by a Minister in a quasi-judicial capacity. As the noble and learned Lord, Lord Boyd, suggested, that is looking increasingly suspect and anachronistic, as a Minister is subject to political pressure and, with many projects being government-sponsored, being both judge and jury.

How then will I decide which of those models to follow—advisory or decision-making. Two conditions are necessary. First, there must be a clear framework within which decisions are made, a framework within which democratic politics plays its part to the full. Secondly, when a decision has to be made about the choice between the benefit of one citizen or organisation and another, it is best to put Ministers at a distance. In the case of the Climate Change Bill, I thought that we came to the right answer, because the Bill was advising on what the framework should be. It was equivalent to advising on what should be the inflation rate that the MPC is targeting.

In this case, I think that the balance of the argument goes the other way. Ministers, after consultation and subject to debate in Parliament, set the framework through the national policy statement, but the IPC decides the outcome in any particular application.

I turn to practicality. I believe that the arguments of practice point in the same direction. There is widespread dissatisfaction with the planning process: the time that the process takes, its unpredictability, its tolerance of repetition and filibuster and its inability to distinguish issues of national importance from those which are principally local. To turn the IPC into an advisory body would, in my view, make things worse than they are today, adding two new processes, neither of which can lead to a definitive and timely outcome. The IPC would conduct its work not knowing whether it was advising or deciding, and when it made a recommendation the aim of anyone opposing the project would be to have another go at raising sufficient clamour to intimidate the Minister into reversing the decision, whatever it was. Issues that logically should have been resolved at a much earlier stage would be reopened, taking us back to square one. The IPC should therefore be the final point of decision, subject only, of course, to the courts.

As the noble Lord, Lord Mogg, discussed at Second Reading, the ageing infrastructure and the need to adapt energy, waste and water systems to reflect climate change mean that, in the next 20 to 30 years, the planning system will come under unprecedented pressure. The delays and uncertainty of the present system cannot be allowed to continue, and the proposals in the Bill balance that sense of urgency with a proposal to give local communities and national interest groups a proper opportunity to make their impact at the right stage in the process. If one wants to close an apparent democratic deficit one should look to the way in which the NPS is handled in Parliament, rather than turning the IPC into an advisory body.

Lord Howarth of Newport: I add a footnote to the excellent points already made by the noble and learned Lord, Lord Boyd, and the noble Lord, Lord Turnbull.

The noble Lord, Lord Dixon-Smith, proposes that the IPC should advise Parliament and that Parliament

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should take the decision. Although we all may feel to a degree uncomfortable that an unaccountable body should take decisions of such political magnitude and sensitivity, there is all the same a question of practicality and how Parliament would cope. The Government anticipate bringing forward some 12 national policy statements, which Parliament will certainly need to consider rather exhaustively. If Parliament is then to consider another large body of specific planning decisions on major infrastructure proposals, how does the noble Lord think parliamentary procedure and parliamentary time will accommodate that sort of workload?

The noble Baroness, Lady Hamwee, believes that the Secretary of State should take the decision on the advice of the IPC. Would she be entirely relaxed about the Secretary of State being judge and jury in so many cases in which the Government themselves are the developer and where they or their agencies are putting forward these very proposals? Is it really satisfactory that the Government should then have the final say?

Baroness Whitaker: I shall briefly supplement the remarks of my noble friend Lord Howarth of Newport. As I understand it—I am by no means an expert—the IPC operates within a framework and cannot operate outside the parameters of the national policy statements. It is in the drawing up of the national policy statements where parliamentary and public input is most prominent. At the risk of sounding terribly sycophantic, I commend an article in today’s HouseMagazine by my noble friend the Minister, which sets out absolutely clearly that the IPC is independent and,

“free to reject any application which it considers fails to meet the conditions set out in the NPS”.

It is hardly a powerful body, flying around the universe doing exactly what it likes.

4 pm

Baroness Young of Old Scone: I sound a discordant note compared with the past few speakers, because I firmly believe that the advisory model, rather than the decision-making model, is the one to be aimed for for the IPC. Perhaps I should say a little about my experience in this field to give noble Lords a flavour of where I am coming from. I have been involved in work on the environment for the past 20 years and have become rather a fan of the planning system, because at times when democracy in this country was looking a bit shaky, it was one of the last few bits of genuine democracy that still existed; elected leaders took decisions about hotly controversial issues with a strong local interest amidst, quite rightly, the discordant views of many stakeholders. It was quite a juicy kernel of the democratic process. To be honest, we toy with that at our peril. That we can take the politics out of these hotly contested decisions is unrealistic.

I do not believe that in many cases the national policy statements will be sufficiently specific to give the certainty of framework that will mean it is simply a technical issue to decide whether a proposal should go ahead. In addition, national policy statements will rapidly get out of date and, therefore, may not continue to be fit for purpose. We need ministerial intervention to give a fresh policy steer at the time of a decision.

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In this country, we are in a perilous position as regards the readiness of our infrastructure to deal with all sorts of issues, not least climate change. In many cases, our water system needs replacing and our drainage systems are inadequate. Many pieces of infrastructure are in the flood plain or are not sufficiently climate-change proof. Our energy system needs to be made climate-change proof. Without doubt, there is a need for speed, but I would worry that the IPC, which is tasked with breaking through the logjams and hastening these proposals forward, would regard its performance indicator as politics rather than a satisfactory decision that takes account of all the competing views on a very local issue.

All those pieces of infrastructure are not about national policy. They are about developments happening on a very local basis that will affect local communities, the local environment and the local economy. Therefore, they all will be very individual and not necessarily amenable to the framework of the national policy statements. In environmental terms, they will be vital. My noble friend Lord Turnbull referred to a few cause célèbres and I can add many more with a strong environmental flavour, not least Dibden Bay where the Minister stepped in. He made a very valuable contribution after the inspector reached a decision and added value by indicating that what needed to be looked at was much wider than that individual location and interpretation of policy.

I urge Ministers to think again. We need a political accountability in making those decisions. I do not believe that it should be Parliament. The prospect of us sitting here listening endlessly to long technical discussion is not the right way forward. The IPC should gather that technical information and should reach a proposition to go to Ministers for an ultimate decision.

Lord Bassam of Brighton: As I explained earlier, this may be a convenient moment to repeat the Statement. I therefore beg to move that further consideration of Amendment No. 1 now be adjourned.

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

Lord Bassam of Brighton: I beg to move that the House do now resume.

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

House resumed.

Financial Markets

4.03 pm

Lord Davies of Oldham: My Lords, with permission, I shall repeat a Statement made in the other place. The Statement is as follows:

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