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Baroness Murphy: My Lords, does the Minister accept that, given the political realities that have been described, while we currently invest £70 billion in the criminalisation policy, there is ample evidence from abroad that more effective means of harm reduction

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can be brought about by the policies that go alongside? Does he also accept that the point made by the noble Baroness, Lady Hanham, that there are ways to invest in addition to the criminalisation policy, might be a way forward?

Lord Brett: My Lords, the Government believe that in resolving these issues there should be a balanced approach and that harm-reduction policies are an essential part of it; for example, in relation to the HIV/AIDS pandemic across the world, and the lack of access to drugs in poor countries. On the other hand, we do not accept the case for decriminalisation and we believe that a balanced approach carried forward with our European partners, who are broadly in agreement with us, is the best way to tackle this international and domestic problem.

Lord Tomlinson: My Lords, does my noble friend accept that internationally one of the best things we can do is to try to limit the supply of drugs coming on to the international market? Does he not think it is about time that the Government had yet another discussion with the Senlis Council in regard to transferring drugs that are produced in Afghanistan to licit use, particularly to deal with the global shortage of opiates, and to see what contribution that can make to stemming the flow of drugs coming into western Europe?

Lord Brett: My Lords, that is an important point and I am more than happy to take that back to my colleagues in Government. The issue in Afghanistan is that the Government of that country have said they are not in a position to administer a licit programme, the danger being greater commercialisation. The point he raises, however, is a good one. There are policy changes and considerations at all levels that need to be taken into account. It is an ever-changing problem both in terms of countries of origin and countries of destination. I am sure the points he made will be carefully considered.

Lord Rea: My Lords, with regard to the question asked by the noble Baroness, Lady Murphy, does my noble friend know of the policies in such countries as Switzerland and Portugal, which have adopted a considerably more liberal way of dealing with their hardened drug addicts? They give them the drugs that they need and decriminalise them. The result of that has been a great reduction in crime and the increased social and physical health of those hardened addicts. Are the Government looking at the policies in those countries and considering their merits?

Lord Brett: My Lords, the Government are happy to continue to review the situation. We are in favour of fact-based research programmes and of looking at any that might provide an answer to our problems that look more advantageous than the solutions that we are currently dealing with. I am sure that that review will continue. If proposals come forward within a balanced approach, this Government favour the introduction of harm-reduction policies but, at the same time, do not believe that we can desert the argument that we need to contain the spread of drugs around the world.

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Employment: Access to Professions


3 pm

Asked By Lord Lea of Crondall

The Lord President of the Council (Baroness Royall of Blaisdon): My Lords, the recent report by the Panel on Fair Access to the Professions was an interim report only. The Government have no plans to respond to the interim report. However, when the panel publishes its final report in the summer, the Government will make a full response.

Lord Lea of Crondall: My Lords, I thank my noble friend for that reply. The Cabinet Office interim study confirms a picture of apartheid Britain, painted so vividly by my noble friend Lord Adonis some years ago, with over 50 per cent of the most senior positions in the law, the media, the financial services and the Civil Service occupied by a privately educated 7 per cent minority of the population—a sort of self-perpetuating closed shop. First, does she agree that the relatively limited opportunities for the 93 per cent in state education and the hugely disproportionate opportunities for the 7 per cent who went to public schools are inevitably two sides of the same question? Secondly, to do something about this stranglehold, would Her Majesty’s Government encourage those involved in the final stage of the study to examine the charitable status of public schools with a view to tax relief being gradually withdrawn from schools that do not have at least 50 per cent of their pupils and governors drawn from the community as a whole?

Baroness Royall of Blaisdon: My Lords, it is precisely because we still have a system, although it is greatly improved, in which children from state education have fewer opportunities than those who are educated privately that this panel was set up. I thank the panel for the work that it is undertaking; it is doing a splendid job. We await the panel’s report but, in the mean time, I shall of course take back the issue about taxation raised by my noble friend.

Lord Waddington: My Lords, does the Leader of the House agree that it is rather foolish to assume, as some do, that the failure of enough people from state schools to reach the top of the professions is due to discrimination or artificial barriers being put up against them? Would it not be more sensible for all of us to concentrate all our efforts on ensuring that the standards in schools are so improved that every really able young person has the chance to get the qualifications necessary for entry into our best universities?

Baroness Royall of Blaisdon: My Lords, the panel, in its interim report, identifies five barriers, of which education is one. Yes, education and educational opportunities are extremely important, which is why I

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am delighted that so much progress has been made on results. However, things like health inequalities are important, too. Then there are things such as Sure Start. The gaps between advantaged and disadvantaged children kick in as early as 22 months, which is why I am very proud of the Sure Start system that this Government introduced, as it means that all children will have more opportunities in their later life.

Baroness Sharp of Guildford: My Lords, is the noble Baroness aware of the fact that the medical profession is one of those that has been making considerable efforts to widen participation? However, medicine involves a very long training and one barrier to students doing that training is the debt that they incur. Are there any plans in the review of fair access and student fees to consider courses that are much longer than the normal three-year degree courses, such as those for the medical profession?

Baroness Royall of Blaisdon: My Lords, I do not have that information to hand, but I will certainly come back to the noble Baroness with further information if I can.

Lord Grocott: My Lords, while I warmly welcome the work of the Panel on Fair Access to the Professions, does my noble friend share my concern about the increasing tendency in more and more professions to have simply graduate-only entry? That means that the vast majority of people in the professions have left school at 18 to do a three-year full-time course and often have gone on to a one or two-year postgraduate course. Is it not important to remember some of the lessons of the past, where many professions were open to people via different routes? Those people had often left school earlier, at 16 or 18, gone into different jobs, and may have decided in their 30s to go into the professions. If we are to widen access, is it not essential that we ensure a variety of entry methods?

Baroness Royall of Blaisdon: My Lords, I strongly agree with my noble friend. We are having 35,000 more apprentices this year, many of whom will, I hope, have access to the professions. Just last week in Knowsley, I met a fantastic bunch of apprentices and I am sure that two or three of them—for example, one working in accountancy and another in the media—will ultimately reach the top of their professions.

Baroness Shephard of Northwold: My Lords, as a member of the panel, I feel that I should declare an interest. Does the Minister agree that it will be important for the panel to do an extremely careful audit of what all the professions are doing to encourage access? We need a thorough look at what is already being done—and a great deal is—before the panel can come to conclusions and enable the Government to consider, in due course, the recommendations that it makes.

Baroness Royall of Blaisdon: Yes, my Lords, the committee clearly has to take its time. It has to get all the information that it requires from the professions about what is happening within them. I am sure that the report, when it is published in the summer, will take all those things into careful consideration.

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Draft Bribery Bill

Membership Motion

3.07 pm

Moved By The Chairman of Committees

Motion agreed.

Perpetuities and Accumulations Bill [HL]

Second Reading

Moved By Lord Bach

Motion agreed.

Postal Services Bill [HL]

Bill Main Page
Copy of the Bill
Explanatory Notes


3.08 pm

Clause 1 : Post Office companies to be owned in their entirety by the Crown

Amendment 1

Moved by Lord Clarke of Hampstead

1: Clause 1, leave out Clause 1 and insert the following new Clause—

“Transfer of property etc.

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(1) On such day as the Secretary of State may by order appoint, all the property, rights and liabilities to which the original holding company was entitled or subject immediately before that day shall be transferred so as to become by virtue of this section property, rights and liabilities of a company nominated for the purposes of this section by order of the Secretary of State.

(2) The Secretary of State may nominate for the purposes of this section any company formed under the Companies Act 2006 (c. 46) which is a company limited by guarantee with no share capital.

(3) The company shall at all times continue to be a company limited by guarantee with no share capital.

(4) An order nominating a company for the purpose of this section shall contain such provisions as to the appointment of directors, and their terms of office, and members of the company as the Secretary of State may consider appropriate.

(5) In this section—

(a) “the appointed day” means the day appointed under this section,

(b) “the original holding company” means the company that was nominated under section 62 of the Postal Services Act 2000 (c. 26) (transfer of property etc to nominated company), and

(c) “the Post Office company” means the company nominated for the purposes of this section.”

Lord Clarke of Hampstead: My Lords, the first amendment in this rather large group deals with the ownership of Royal Mail and the vexed problem that people like me face on the question of its privatisation. Amendment 1 seeks to remove the Government’s Clause 1 and replace it with the proposed new clause as printed on pages 1 and 2 of the Marshalled List. It would remove the distinction between the Post Office and Royal Mail companies and the differences in their ownership. It then provides for the transfer of all the property rights and liabilities of Royal Mail Holdings plc to a newly-formed company, limited by guarantee, which is to be nominated by the Secretary of State.

I have placed these amendments deliberately in the hope that our Government are both listening and learning and are prepared to rectify the serious mistake they are likely to make if they continue on their present journey. Growing numbers inside and outside this House, and in the other place, are against the Government’s proposals for privatisation. This opposition is very soundly based and has been reinforced by evidence and events since the Bill was first introduced to the House.

Noble Lords will recall that the Government, without pause for reflection, and on the same day that the Hooper report was published, announced their support for all the recommendations of that report, including privatisation. This was, we were told, a coherent package of measures which had to be taken together. It was based on analysis that was supposed to demonstrate that the Royal Mail was both the least profitable and the least efficient of the European postal providers. On such a basis, radical surgery in the form of a strategic partner from the private sector was necessary. The industry is to be part-privatised, with just less than 50 per cent being offered to the partner.

December 16 seemed a day of great and clear purpose for the Government. How have the analysis and the proposals held up since that time? First, we have to note that the Bill departed from the strictures

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of Hooper, being a package from which no departure was allowed. The Bill includes a facility to establish a universal service support fund. I endorse that facility, and it has been endorsed by the people who work in the industry. Hooper explicitly rejected the establishment of such a fund, characterising it as counterproductive.

Despite Hooper’s certainty that the Government and their advisers were less clear than Hooper that the only distortion to the postal industry was the public ownership of the Royal Mail, somewhere there was a nagging doubt—that the mistakes of Postcomm had been underplayed by Hooper in his final report; an impression that will be reinforced by rereading Hooper’s earlier and superior report. That is the interim report, which mysteriously got changed after certain interventions by government people. Be that as it may, the Government allowed themselves this exception, despite Hooper insisting that his report could not be taken a la carte. I suggest that the Government should recognise their mistake in their hasty endorsement of the rest of Hooper, because everything since 16 December tells against the supposed integrity of Hooper’s analysis.

For example, in April the Universal Postal Union published an important report: The global economic and financial crisis: Initial insights into its impact on the postal sector. That interesting report analyses the impact of the recession on all major postal operators in the world. In this sense, it is an important corrective to the Hooper report, which fails to suggest what impact the recession was having on Royal Mail and the mail market in general. In fact, Hooper’s report tends to view declining mail volumes as essentially a result of e-substitution. However, the UPU report is notable for giving a context for changes in postal traffic and thus a greater explanation. It is clear that the postal industry, like other industries, is suffering from the impact of the recession. The report indicates that there has been a sharp decline in domestic letter traffic of an average of 5.9 per cent during the fourth quarter of 2008 compared to the previous year. Express activity suffered even more sharply, dropping by 7.9 per cent on the same year to year basis. Parcels traffic has suffered least from the crisis, displaying a strong resilience, despite the economic downturn, and saw a 1.1 per cent growth during the fourth quarter of last year.

What is very positive in the report is that it gives those figures an even broader context by comparing the position to that of the Great Depression in the 1930s. Of course, such comparisons are freely drawn by many commentators when trying to analyse the current recession and crisis in the financial sector. I am convinced that such a comparison is also helpful in understanding the real state of the postal industry today.

How does this comparison work in the postal sector? In the United States Postal Service, revenue declined by 12.3 per cent between 1931 and 1932. In Germany, letter postal volumes declined by 16.6 per cent between 1930 and 1931. In France, there was a 15.5 per cent drop in franking revenues between 1929 and 1930, leading to a 24.8 per cent drop in these revenues between 1931 and 1932. This allows us to see that, despite Hooper, there is a clear cyclical element at work in mail traffic variations in line with cyclical

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developments in the rest of the economy. We can therefore say that Hooper’s report has failed to locate the problems facing the postal industry in the context of the international economic recession.

It would be a great mistake for the Government to ignore this new material and to assume that Hooper has the final word on future trends in traffic. It would certainly be foolish to fail to anticipate Royal Mail’s contribution to the economic recovery. It may be said that this is interesting but not the most significant element of Hooper’s analysis. We must then return to other elements, including the suggestion that Royal Mail is both the least profitable and the least efficient of European postal operators. I say that again, because if a lie is told, as somebody in fascist Germany in the 1930s said, and you repeat it, it will be believed. The suggestion that Royal Mail is both the least profitable and least efficient of the European postal operators is simply not true.

Last week, first quarter results were published by a number of European privatised postal operators. TNT saw a year-on-year drop of 58 per cent in operating profits. Posten, in Sweden, suffered a drop of nearly 50 per cent in operating earnings. Post Denmark saw its profits drop by 52 per cent. Deutsche Post has yet to publish its first quarter results, but in the last quarter of 2008 it reported a €3.16 billion loss. In comparison, Royal Mail has increased its profits in both quarters and is expected roughly to double its profits for the full year. So much for Royal Mail being the least profitable operator.

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