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We can move the focus to the difficult issue of coal, which is one of our indigenous energy resources and will be so when North Sea oil and gas effectively have been exhausted. The usual assumption is that in future coal will be burned only in power generation where carbon capture and storage are in place. Perhaps that ought to be the case for oil and gas generation of electricity because they also produce a large amount of CO2 even if only about half the amount of coal itself, but CO2 capture and storage is unproved technology. It seems to be possible but we do not quite know what its cost and practicality will be on a really large scale. If we order no new coal-fired plant in the immediate future, such as that at Kingsnorth, do we not risk power shortages in a few years’ time, as has often been suggested in this House? Can we count on installing CCS technology whatever the cost without wider international agreements? It would be a great pity and, in some ways, not of much effect if this country were to adopt a policy on CCS different from other major economies.

Gas-fired power stations have been the main market solution for the past 20 years; the so-called “dash for gas”. That has conveniently helped the country, the Government, meet the Kyoto obligations because they produce just less than half the CO2 per unit of electricity generated compared with coal. However, that will result in us needing to import at least 80 per cent, possibly even 90 per cent, of our gas requirements by 2020. That is another difficult dilemma, which it is, in many ways, too late to face. I often think that future generations will look back and think that we have simply squandered the benefits of North Sea oil and gas in a generation or two.

All this is set against the climate change agenda. The Government have committed us all to the challenging target of an 80 per cent reduction by 2050. We now need a credible strategy to reach that target that addresses, somewhat more directly, the various areas where, for one reason or another, there has been a certain absence of longer-term planning. It is only as the ideal and the vision are cashed out in practical planning that we will be able to test and evaluate things against the broader economic, social and environmental agendas that are around. It will be credible only if it is taken forward on a European and, indeed, an international stage, as the gracious Speech indicated.

That brings me to my final dilemma. Action to reduce the demand for oil, gas and coal will have the effect of reducing their price on the world market. Look at the fall in oil prices in recent months in response to quite a small reduction in demand. That makes oil and gas more affordable to everyone, especially in developing countries. In many ways, that is to be welcomed. The difficulty is that the value in oil, gas and coal lies largely in the energy that is locked up in their atomic and molecular structures, and that can be unlocked only by turning them into carbon dioxide and, in some cases, water. Countries that have indigenous resources of oil or gas are very unlikely to leave them in the ground. The economic pressure to utilise them is great whether a country is the poorest or richest on earth. In one way or another, and at one speed or another, it looks as though the world’s resources of

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oil, gas and, to some degree, coal are likely to be turned into increasing amounts of carbon dioxide in the atmosphere. Halting deforestation and carbon capture technology are likely to have only a relatively small impact on this process, at least for the medium term, perhaps until 2050.

If global warming is caused by increases in carbon dioxide and other greenhouse gases, which is the dominant, but not universal, belief among the world’s scientists, climate change—global warming—is likely to continue throughout the 21st century. If so, alongside necessary efforts to mitigate the rise in CO2 concentrations, should there not also be more attention to the demands of adaptation to climate change, which does not look to be easily reversible? The impact of climate change is likely to be greater on poorer countries, partly for geographical reasons and partly because they have fewer resources to enable them to engage in the process of adaptation that richer countries will be able to do more easily. That is a major dilemma. How do we strike the balance between resources devoted to decarbonisation and those devoted to adaptation to climate change? The question needs more open discussion and cannot simply be put on one side because of the overwhelming moral imperative that the Climate Change Act has set before us.

I wish the Government well as they grapple with these huge, difficult challenges, and I look forward to explicit longer-term planning across these areas. It is not just on the financial front where the limitations of market-driven solutions are becoming apparent.

5.54 pm

Lord Mawson: My Lords, I welcome the Government’s proposals in the gracious Speech to bring forward legislation to promote local economic development and to create greater opportunities for community and individual involvement in local decision-making. The theme of handing power back to people—this was articulated in the Government’s report, Preparing Britain for the Future, which recognises that:

“People want to work with and direct Government to do things for them, not just have their Government do things to them”—

is correct.

I welcome the emphasis in this report and its desire to empower individuals by involving them in the design and delivery of local public services and in other measures that are designed to promote local democracy and larger numbers of active citizens. This is all correct. New Labour has done much to move the debate on in this whole area, and should be thanked for it. However, the devil, as always, is in the detail, and a lot of my work over the past 25 years as a social entrepreneur has been precisely about demonstrating what some of these aspirations might mean in practice in some of the poorest communities in Britain.

The present recession, of course, may bring with it many difficulties for all of us—business, the public and voluntary sectors—but it also brings with it new opportunities that entrepreneurs such as me are keen to grasp: opportunities to spend hard pressed taxpayers’ money more efficiently and in new ways through social enterprise, to grow and deepen the practical relationships

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between business, the public and the social enterprise sectors, and to find new ways of delivering services so that we all get more bang for our buck. To do this, the Civil Service has to move further than it has done to date to create the kinds of environments in which these new relationships can flower and flourish. There are still too many silos in government. Despite many years of rhetoric about joined-up thinking and joined-up action, I still see all over this country, in some of our poorest communities, example after example of these kinds of relationships not happening or being prevented, at great cost to the public purse. Partnership is all about personal relationships and not just about structures, systems and processes.

Two words—democracy and delivery—have been at the heart of new Labour’s policies. The intention is to deliver public services more efficiently and in a more joined-up way, while at the same time involving people more effectively in the decision-making process so that it feels real to them. The trick is to get the right balance between talking and doing.

There is a danger that if community empowerment is about creating yet more committees in local communities across the country, we will miss a great deal of the creative input from people who actually do things rather than just talk. The Bromley by Bow Centre and Poplar HARCA, the £300 million housing company—both of which I helped to found, so I must declare an interest—have taken this thinking very seriously over the years and have struggled, with some success, to marry the structures imposed on us by the Housing Corporation while encouraging the active participation of residents.

The key is to help residents on housing estates to develop practical citizenship rather than stay at home watching television or spend their lives at endless meetings creating mini versions of the local authority. Power and trust are key. Rather than simply consulting and involving people in how the state delivers services, social entrepreneurs with the desire—and, with support, the capacity—to deliver those services should be encouraged and enabled to do so.

I would go further and say that in regeneration areas where local people can demonstrate a viable quality plan to run a public service—be it a school, a housing maintenance programme, or services for disabled people or the elderly—the presumption should be that the public body should contract out that service. Yes, this will make the local situation messy, but communities and families are equally messy, and unless local services connect with that fact, they will not deliver effectively. By enabling far more provision of local services by local organisations, with all the appropriate safeguards and a real focus on quality, state funds stay in communities and local people feel far more empowered.

This is the approach that we have adopted at Bromley by Bow. We call it communities in business. We sat down with the local authority and negotiated a range of services that we could deliver in a more appropriate and connected way. However, this approach is not generally welcomed by civil servants at a national, regional or local level. It unsettles them and worries them because there is a genuine transfer of control into the community, which brings us back to the

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paradox of this Government saying that they want to involve local people, but are actually very keen on control. If you are serious about community engagement, ultimately, you have to trust local people, let go and not micro-manage.

The social enterprise movement in Britain is starting to challenge some highly cherished principles about equity, risk management and democratic accountability; namely, principles that are strongly defended by many politicians and public sector officials, often in the face of evidence that they simply do not deliver for the poorest communities in this country. In particular, social entrepreneurs suggest that power and decision-making in disadvantaged neighbourhoods might be more productively vested in those who can deliver, rather than in representative elected committees and boards. Starting with people before structures, we challenge the prevailing notion of what constitutes democratic legitimacy. Social enterprise is rather more honest about the failure of existing representative structures of local government to involve, or even interest, the great majority of the population.

The early vision of our previous Prime Minister was a great one; rhetoric suggested a radical entrepreneurial approach but, in practice, programmes such as Sure Start were more focused on management than enterprise, more on formal representation than direct practical involvement and, yet again, more on short-term than long-term vision. New Labour seemed set on creating what colleagues of mine have called “communities in committee”, which have so often been stifled by the institutional forms on which they rely.

Instead, I believe that hard times provide us with an opportunity to take a hard look at alternatives to this approach, which delivers public services, practical action and the participation of our citizens. We call this approach “communities in business” and we have started to have some success with this new way of working in the East End of London, where our family of social enterprises, in partnership with business and the public sector, is now putting together a £1 billion regeneration project. We offer this hard won practical experience to Ministers and are willing to share with them the detail as they take their Bill through Parliament. There are examples of local authorities coming to similar conclusions. The London Borough of Newham is a good example and I would encourage Ministers to look at what it is doing. It has important lessons to teach us all.

Across the country, people are growing weary of traditional community consultation and community governance, which has failed to engage their interest or commitment, or make any real changes to their lives. Compare these processes to Jamie Oliver's school meals campaign and you begin to get an idea of the difference between a traditional public sector approach to community involvement and that of a social entrepreneur. Places like the Bromley by Bow Centre have grown up out of this frustration, engaging large sections of our community in their own regeneration, but our approach cannot be drawn up as a Cabinet Office blueprint and then standardised across the country.

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Communities need to be given the space and the freedom to develop in a way that works best for them. To be successful you have to take account of the local environment. Nevertheless, lessons can definitely be learnt from these examples of good practice and worthwhile guidelines can be drawn up. I believe that you really become a citizen of this country by what you do, not just by what you talk about. Creating a country of active participants could refresh our democracy in new and interesting ways, but it is about more than drawing everyone into endless committees and meetings. Let us leave committees and meetings to places such as your Lordships’ House. Let our people be active citizens.

6.03 pm

Lord Parekh: My Lords, I shall begin with an apology. Although I have a very bad throat, I put my name down to speak in this debate because it raises some extremely important issues on which I want to share a few thoughts. The gracious Speech commits the Government to creating a single equality Act. In so doing, it redeems the Government’s pledge given in the 2005 election manifesto. The proposed equality Act will reduce nine major pieces of legislation and around 100 statutory instruments to a single Act and will harmonise different strands of equality. I welcome the Bill and many of its provisions.

As the Government rightly note, equality is vital for the development of individual talents and for creating a cohesive society. It is precisely because I welcome the Bill that I shall concentrate on four or five areas where it needs to be strengthened. First, the Government spend between £160 billion and £175 billion on procuring goods and services from the private sector. This gives them powerful leverage, which should be used effectively to ensure that the private sector fulfils their equality objectives. In the 1980s and 1990s, the American Government did that with considerable success in the name of contract compliance. The Bill refers to the Government’s power, but it is not entirely clear what pressure they intend to exert on the private sector, how they will enforce and monitor such powers, and what incentives and penalties they will rely on to make sure that the private sector realises their objectives.

Secondly, the Government are rightly worried about ensuring equal pay for women. The difference in earnings between men and women is 17.1 per cent in the public sector and 21.7 per cent in the private sector. For part-time workers, the figure can be as high as 36.6 per cent. An average full-time weekly earning for men is £521, as opposed to £412 for women. Not surprisingly, the World Economic Forum placed Britain 81st in the world in terms of equal pay. Something needs to be done.

While 43 per cent of public sector organisations have completed or are planning to conduct an equal pay review, only 23 per cent of private sector organisations are doing that. As has been pointed out, at this rate, we will have to wait for 150 years to ensure equal pay for women. How will we tackle this? The Government rightly talk about a mandatory pay audit. Obviously, there is something to be said for that, but it is a strong, blunt instrument. One way would be to make the

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organisation concerned transparent so that these things can be easily understood. Another would be to make it easier to pursue and resolve the complaints that individuals might make within an organisation or in a court.

The same problem occurs in relation to the ethnic minorities where the disparity is even greater. Equally qualified men receive highly unequal pay, which is sometimes known as the “ethnic penalty”. I am a little surprised that the Bill is silent on that and concentrates almost entirely on gender equality.

Thirdly, the Bill also is silent on the regular audit of government policies with regard to their impact on equality. The Government have rightly agreed on a £700 billion package to bail out banks and the financial sector. But they have offered only £1 billion to help out small- and medium-sized businesses, which is to be delivered through the banks. Let us look at this from the standpoint of ethnic minorities. Most ethnic minorities work not in banks and the financial sector, but in small- and medium-sized businesses, and they get a very tiny slice of the national cake.

More importantly, banks have not been even-handed in their lending practices or risk assessment. The Runnymede Trust, of which I am a patron, recently published a report called, Financial Inclusion and Ethnicity. It showed conclusively that the banks have been deeply biased in their lending practices. If that is the case—I hope that the Government will commission a survey on this—what provisions have the Government made to ensure that support for small- and medium-sized businesses is channelled through banks, but is carefully monitored?

Unless carefully planned, government policies—the example that I have given confirms this—are likely to marginalise ethnic minorities, and recovery from recession, as and when it occurs, which I hope will be soon, will not be inclusive and fair. It is striking and somewhat disappointing that in the debate the other day on business, no mention was made of how the Government policies of bailing out banks or small businesses are likely to impact on ethnic minorities. Even my noble friend Lord Mandelson, whom I admire, made absolutely no reference in opening the debate to how government policies are going to affect ethnic minorities and whether they might not turn out to be deeply discriminatory—unintentionally, of course—in their impact on ethnic minorities.

My third point concerns the policy of positive action. The Government are rightly committed to a policy of positive action, which broadly states that if two candidates are equally qualified, a member of an under-represented and disadvantaged group might be preferred. We see this sort of positive action in many areas, and it is permitted through case law in the European Court of Justice. That is fine, and I welcome the policy, although it seems to have been opposed by the CBI and many other institutions. I want to go a step further. To say that preference will be given to under-represented and disadvantaged groups when the candidates are equal raises two questions. First, it is never easy to decide whether two candidates are equally qualified. When someone is to be appointed to the House of Lords and one candidate is a professor and the other a businessman, both equally qualified in

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their fields, how do we decide? Secondly, and more importantly given past experience, there is no guarantee that bias and discrimination would play no role in the judgment of candidates. It is because we realise these difficulties that we have talked in terms of targets, which offer a broad indication of what an organisation should look like if it is fairly and justly run. Targets are not quotas, which everyone knows are unacceptable.

When we note that women MPs make up only one-fifth of the membership of House of Commons and say that something needs to be done, we are neither advocating a quota nor saying that women should be selected only when they are equal in all other respects. What we are saying is that given women’s representation in the country at large, there is no good reason, unless we assume that they are less intelligent, why women should not be more or less equally represented. Starting from that kind of self-evident premise, how do we explain the failure of an organisation to come up to these norms? Such thinking is even more necessary in relation to ethnic minorities, the disabled and other under-represented and disadvantaged groups. I would suggest that the fact that a group is under-represented and disadvantaged does not come into play only after other factors are taken into account. Instead it should be one of the important factors to be taken into consideration in the first instance when deciding who is best qualified for a particular job.

Finally, I turn to the specific duty that the Government intend to place on public sector inspectorates to monitor how well public bodies comply with their equality obligations. I like this proposal, but in order for it to be effective, there will have to be greater transparency in the organisations concerned, both private and public, and greater powers for the inspectorates to name and shame organisations; and perhaps even the power to impose penalties. I see no reference to such measures in the Bill. It becomes particularly important in relation to the private sector, which is beyond the ambit of official inspectorates. What is going to be done in relation to that sector? I draw attention to the simple fact that 11 per cent of the directorships in FTSE 100 companies are held by women, fewer than 2 per cent by ethnic minorities and even less by other disadvantaged groups. What do the Government intend to do about that?

Lord Patel of Bradford: My Lords, I should be grateful if noble Lords could keep to the eight minutes allocated to speeches; otherwise we will run a long way past the 10 pm deadline.

6.14 pm

The Earl of Mar and Kellie: My Lords, I put my name down to speak today in the mistaken belief that there would be a transport Bill, on to which I could tag some remarks about small-scale energy generation and, indeed, a few comments on the state of Scottish democracy. I accept that those last comments might have been more appropriate to yesterday’s debate, and I know that I can speak only once. Lastly, I will stick to the eight-minute time limit.

Expecting to take an interest in the air and marine security Bill, I discover that the former area will become part of the police Bill and the latter will no longer be

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legislated for. Airport and airline security are already major issues; most passengers know that because of the queues at check-in, security and at the gate. As a regular rail passenger to this House, I know that while the rail journey time from central Scotland has remained static at around four-and-a-half hours, the air journey has become longer as the result of airport problems. The journey time by air and rail from central Edinburgh or Glasgow is now probably about even. This is a welcome but perverse way of encouraging modal shift from air to rail, but it does deliver rail-for-air substitution.

Next week, Virgin Trains on the west coast main line will deliver an almost hourly service between Glasgow and London, thus approaching comparability with National Express East Coast’s Edinburgh to London timetable. It will be interesting to see whether a modal shift takes place from Glasgow as has happened from Edinburgh, at least to a degree. Virgin Trains needs one more Pendolino set to achieve an hourly schedule, which is part of the 1,300 carriages eventually to be delivered by 2014 and thus would be too late.

On marine security and piracy, I listened with interest to the Radio 4 interview yesterday with the new admiral who has taken command of the multinational force brought together to combat piracy off the Somali and Yemen coasts. His problem is what to do with the pirates once they have been caught. The requirement to land them in a local state with a suitable justice system is a difficult one, and I am not surprised that there is reluctance among such states to clutter their court systems and prisons with someone’s else’s criminals. I am therefore not surprised that marine security legislation will not be brought forward until, presumably, there is a viable strategy. In the mean time, I wish the Royal Navy well in its anti-piracy mission.

I am disappointed that there is no high-speed rail Bill or any precursor to one. Everyone knows that such a line is necessary and that it will be built, so my complaint is that when it takes so long for a major infrastructure project to be built, why are we not starting the process now, given that we need a high-speed network?

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