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The House of Commons is the foundation of all our liberties. The confidence of the House of Commons, which has made sure that we can all walk as free subjects of the Crown around this country, is something of magic and awe. If Members there lose their bottle and start wandering around with their shoulders hunched and terrified, we will all suffer appallingly for it.

I wish that the noble Lord, Lord Barnett, would divide the House on Second Reading, because I would not walk through the Lobby, I would run through the Lobby with him. This Bill has been completely and comprehensively destroyed. I do not even need to read the bits that I have marked in these two reports, because they are there. The noble Lord, Lord Armstrong, perfectly sensibly said that this problem could be solved by proper structures on the instructions of the House of Commons. It does not need to be outsourced-like being outsourced to a call centre in Bangalore.

I will finish my brief remarks by congratulating the noble Baroness, Lady Royall. I say that because when we had our little troubles, she acted immediately and decisively. The Privileges Committee acted immediately and decisively and we suddenly discovered-was it not lovely?-that we had the power to suspend. We had not known that we had it for 800 years but we suddenly found it. She acted with speed and decisiveness and now she has to show a lot of courage. She has to get up at the end of this debate and say-is she listening?

Baroness Royall of Blaisdon: Yes, my Lords.

The Earl of Onslow: Good, my Lords, she is. Well done.

The noble Baroness has to get up and say, "I have listened to very distinguished gentleman from all sides of the House"-and ladies, because I am not being sexist. I do not want to be reported to Harriet Harman. She should get up and say, "I have listened. The case for agreeing with what the noble Lord, Lord Norton of Louth, proposes is overwhelming. I am going to go back to the Prime Minister and say, 'First Lord of the Treasury, if you want real trouble with the House of Lords this is what you will get. If you want a little co-operation on something which is pretty awful anyway, at least you'll get it if I can do this'". The noble Baroness should give an undertaking to say that and then do it, and if she gets the sack, we will all buy her a pension. It is as simple as that.

7.35 pm

Lord Cope of Berkeley: My Lords, the only surprise in the speech of my noble friend Lord Onslow was that he was in the least worried about being reported to Harriet Harman. I was surprised about that.

This has been an exceptional debate, not least for the speeches of the two Labour Peers. But like the noble Lord, Lord Barnett, I find most of the things

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that I had in mind have already been said much more effectively than I could have done and have helped to change my own appreciation of this particular Bill.

We have all been shocked over the past few weeks by these expenses revelations and the Commons is shell-shocked by them, which is what has given rise to the Bill, as others have said in different forms. There are two elements to the Bill. One is about expenses. I understand the Commons wants to try to do something about expenses before the Summer Recess starts, even though things are already going to happen during the Recess as consideration is given to what should happen in the future about the salaries and expenses of Members of Parliament.

In any case, I am perfectly sure that in practice the expenses regime has already changed a great deal. I am quite sure that Members of Parliament are not claiming things that they would have claimed some months ago. I am also quite sure that the officials of what is now called the House of Commons Department of Resources are being much more careful about the expenses that they agree. I am also quite certain that the audit of what is happening now, which will be done in due course, will be much more rigorous than the previous audit of what was happening. So, as a matter of fact, the expenses regime has already changed a great deal in practice, whatever happens to the Bill.

However, the Bill is also about what to do about the interests of Members of Parliament, and there is no urgency for that. The public have not been bothered about that to any great degree recently. It is a matter of the greatest complexity and anyone who did not understand that only has to read today's proceedings. There is much more that can be said about that, but I will not trouble your Lordships at the moment.

Our excellent Leader of the House said at the beginning of her remarks that this is Commons business and we should let the Commons decide what happens to the Commons in respect of its allowances and so forth. I would have agreed with that until recently, but the fact is that the Commons brought us, your Lordships' House, into this. Things used to be settled with Commons Standing Orders, where we had no locus or role at all. The setting up of the present commissioner and so forth was all dealt with under Commons Standing Orders. Now it is proposed that it should all be done by statute law. That means both Houses of Parliament are involved in deciding what should be in statute law. There is also the danger of bringing in the courts. A lot has been said about that, to which I do not need to add this afternoon.

The Commons has brought us into this, and this afternoon's debate has amply demonstrated that the Committee and Report stages will take a long time to settle. There is already a raft of amendments down before we even start our consideration-some of the greatest importance. We have heard enough this afternoon to know that it will all take a very long time. The very least that the Leader of the House needs to do when she winds up is to set out in detail the timetable that she now proposes we should follow. The very short timetables that have so far been suggested do not seem in the least adequate. Perhaps that will mean that we do not start the Recess as soon as we thought we

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might. Perhaps it will mean that we interrupt the Recess to come back to consideration of the Bill after a lull; or perhaps it will mean that we return to the matter after the Recess. It is unfortunate that the Recess is upon us because it adds to the difficulties of public presentation and, for that matter, of the consideration of the issues involved.

We have been greatly assisted by the very fast and excellent work of the Constitution Committee, the Joint Committee on Human Rights and the Justice Committee. We have been greatly assisted by their fast work. I have no doubt that your Lordships will give great attention to the detail in the Bill but we need to know what the future is for both parts of the Bill; the part that deals with expenses and the part that deals with Members' interests, which is much the more complicated and over which there is no urgency at all.

7.41 pm

Lord Elystan-Morgan: My Lords, as your Lordships will appreciate, I am the 24th speaker and the last man in, as it were, from the Back Benches. As last man in, if I can push a few singles past mid-off in a short period, I shall be more than happy. We all appreciate that two or three months ago a bombshell exploded. In consequence of that, one of the greatest parliamentary scandals of all time has occurred. It may not be, by a long way, the worst scandal that has occurred in the history of Parliament, but its effect is probably the most injurious development in at least the last 100 years-and possibly the last 200-in the life of Parliament. It is against that background that we must consider this issue.

In such circumstances, any Government would immediately say to themselves, "What must we do?". There was a case for immediacy and the Government have acted with immediacy, but immediacy means different things. Immediacy means the immediate acceptance of the problem, commitment to dealing with it and setting up of proper institutions to make that possible. Immediacy does not mean an immediate problem, an immediate answer and immediate legislation. That, I think, is exactly where the Government fail. They fail probably not on account of their faults but on account of their virtues-by believing that it was somehow possible to conjure a complete, wise and Solomonic solution to the dreadful situation that is now upon us. It is not a situation that can be met with logic because public anger does not operate logically. Public anger can very often be brought about by the very measures that we would impose on ourselves in this connection.

What should the Government have done? They should have set up the most rigorous inquiry into exactly what has happened and how it started. There have been very candid contributions from the noble Lords, Lord Crickhowell and Lord Jenkin. Whether it started exactly on their watch or earlier does not matter. It started some time in the last 30 years. It is what might be called the nettle problem-the failure to grasp a nettle that was there. The nettle was the realisation that practically every other Parliament in western Europe paid anything up to twice as much as British Members of Parliament were receiving. It was, happily, just after the time when the electorate released

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me from Parliament. MPs very properly went to their masters and said, "Raise our salaries". They were told, "It is not possible but we will think of a few alternatives, provided you are reasonable about them". That was the beginning of it all.

In addition to that examination, there should have been an examination of all the possible alternatives, to meet not only substantially, but psychologically, the anger that has now built up in the public against Parliament. All those alternatives should have been considered and, after that, there should have been the fullest consultation. I do not mean consultation between party leaders, which is sometimes rather conspiratorial, but consultation with the public. It is, after all, their Parliament and it is right that they should feel involved in dealing with the problem and, indeed, the whole issue. Then-and only then-should a draft Bill have been prepared. Once that Bill was prepared, it should have gone to one place, namely the Constitution Committee, for the most rigorous scrutiny that a Bill has ever had. We have done none of these things and have done the exact opposite. I say "we", taking responsibility-corporately, as a member of the community-for what the Government have done.

The noble Baroness the Leader of the House, for whom I-like every other Member of the House-have profound admiration and respect, tells us that this is not a Bill that in any way involves this House. That, of course, is technically true, but it is a Bill that massively affects and involves this House, which is exactly what we must consider. I accept what is now said about the intention to tag this House on to the Bill. Indeed, there is nothing in Clause 1 that refers specifically to the House of Commons. It could refer to both Houses. Be that as it may, I accept completely that there will be no tagging on now, nor indeed-as the noble Baroness the Leader of the House says-until there is some change in the constitution of this House. I suppose that must be many, many years hence.

Nevertheless, there will still be effects on the House as the upper Chamber of Parliament. There is bound to be an effect on its relationship with the courts. We have had the benefit of the most erudite and valuable opinion of the noble and learned Lord, Lord Woolf; we must accept him at his word. One of two things will occur. If the Bill remains as it is now drafted, there will be a flood of applications for judicial review. If that right is removed a very gross misjudgment will have been made, and a very gross injustice will have been imposed on those Members of Parliament. There may be halfway houses between the two situations. It is far too late at night to consider them now, but they are extremely complicated and each has its counterdifficulties.

So, what are we to do? I agree completely with everything that has been said by the noble Lord with regard to the amendment. It seems to me that the whole issue can be distilled to one question. Does anybody in the House not believe that, if the House-in dealing with this Bill of crucial constitutional significance, in the full glare of public contempt and anger-is able to avoid its responsibility of scrutinising the Bill line by line and word by word, the House will have abrogated its right to existence as a Second Chamber? That is the whole issue as far as the timing is concerned. How it is

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overcome is not all that important. It may be done by delaying the matter until the end of the summer vacation. It may be done by spending practically the whole of the period that we have left until 21 July on the Bill. It may be done by delaying the vacation by a few weeks. It matters not. If we fail to do it, we will have betrayed the very best interests of this place. If we do it, I believe that we will have properly earned a substantial measure of public respect.

I mention a very narrow legal point that has already been alluded to by many noble Lords; namely, the offences section and the proposal that Members of Parliament responsible for abuses in relation to expenses claims should be dealt with in a particular way. This is not at all a case of double-banking and unnecessarily creating an offence. The offences are contained in Section 17 of the Theft Act 1968-the offence of falsification of accounts-and in Section 2 of the Fraud Act 2006. The major point to remember is that the wording of those offences, in the Theft Act and in the Fraud Act, is almost identical to the wording of the offence in subsection (1) of the relevant clause. This means therefore that the elements of those three offences are exactly the same. There is not the slightest necessity or justification for this subsection. Why was it introduced and what will its message be? Its message is this: whereas ordinary citizens who commit these fraudulent offences are liable to 10 years' maximum imprisonment under the Fraud Act, and seven years' imprisonment under the Theft Act, there will be a very tame and limited tariff of one year's imprisonment, or six months or 12 months in the magistrates' court depending on whether that matter arose before or after the Criminal Justice Act 2003. That will be seen not as trying to lay better standards for Members of Parliament but treating them in a way in which the ordinary member of the public is not treated.

7.51 pm

Lord Tyler: My Lords, as will be apparent from my speech, which I approach with great trepidation, I am not a lawyer. However, I have had experience in the other place as shadow leader of the Commons for some eight years. During that time I made a great many friends and had many contacts with Members on all sides. As the noble Lord, Lord Norton of Louth, properly said, many Members on all sides of that House are looking to us to save them from themselves. It would be an illusion if we were to expect and accept that this House must somehow just rubber-stamp what has happened in the other place. I shall come back to that point in a moment.

Let us not fool ourselves; there is a genuine dilemma. Everyone on all sides-this is apparent in your Lordships' House this afternoon-is keen to see a practical resolution to the various expenses scandals, which starts us on the long road of trying to renew public trust in both Houses of Parliament, and, indeed, in our political system. Anyone who works anywhere near this place, be they the most senior parliamentarian or a temporary contractor, knows that the mere mention of where we work gives rise at the moment to howls of derision. I think that the noble Baroness, Lady Perry of Southwark, used those words. It is a serious problem and we should not in any way underestimate that.

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The public simply do not understand, or accept, that MPs or Members of your Lordships' House should be solely responsible for setting their own pay and conditions. Very few members of the public set their own salaries and still fewer can claim expenses underwritten by the honour of their signature alone rather than by the presence of a receipt. People are understandably urging that Parliament should meet the same standards as the people for whom we legislate. However, this is the dilemma: Parliament is sovereign. Deciding things is what Parliament does, so it is quite difficult to make laws to stop it deciding things. That is the centre of the dilemma which this Bill is all about. It is going to be very difficult to find a way in which Parliament can legislate so that it no longer has any say on this issue. For one thing, what will be the budget of the IPSA and who will set it? Is it not the primary responsibility of the House of Commons to be responsible for "supply"-for money? That is what it is for and has been for many centuries.

The Government, and in a sense the whole political establishment, are acting as though this is a new problem. That is why we are told that this is emergency legislation with special procedures. But this problem is, of course, not new. It is a pitiful situation in which we now find ourselves-the proverbial bulls lumbering around the china shop, with a piece of poorly drafted, ill thought-out legislation. I have not yet heard anyone say this afternoon or this evening that this Bill is in a proper form to go on to the statute book. As has already been said-legislate in haste, repent at leisure. It was ironic that on the very same day that the Commons could not find time to have a Third Reading of this Bill, a Bill was brought before that House to amend the Dangerous Dogs Act. I think that others have referred to this Bill as the Dangerous Politicians Act on the same basis; namely, that it is a knee-jerk and inadequate reaction.

My noble friend Lord Shutt has said that we on these Benches are not in the business of delay for delay's sake. All of us are here to do our job, and our job is to try to make sure that what returns to the other place is a great deal better than the Bill that has come to us. We simply cannot attempt to make an inadequate response to the critical situation we face. The Bill that leaves this House has to be seen as a great improvement on what we have at the moment, even if that is achieved through very drastic surgery. I assure the noble Lord, Lord Peston, that there is no question of us nodding through the Bill in its present state.

Lord Peston: My Lords, will the noble Lord recommend to his colleagues that they should vote for the amendment of the noble Lord, Lord Norton?

Lord Tyler: My Lords, I shall come to that point immediately as it is raised. We believe that the amendments that are already on the Order Paper, and those which are likely to flow from today's debate, will require at least three days in Committee next week. That is our preference. If that preference is not met by the Government's business managers we will review the situation because we do not believe that it will be possible to achieve the radical surgery that this Bill requires in the time currently available. If it is the view of this House that it is appropriate to delay further

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consideration of this Bill for 10 or 12 weeks, I suggest that it is out of touch with public opinion. As has already been said by many Members of this House, the public consider that this matter needs to be addressed. That will not be achieved by accepting every bit of this Bill in its present form. Indeed, it has already become clear that it may be appropriate to amend the first part of the Bill to address the public's concern and leave some of the latter parts for the time being.

Lord Crickhowell: My Lords, will the noble Lord tell the House what he and his colleagues will do if he is not this evening-before my noble friend Lord Norton has the opportunity to move his amendment-promised three days in Committee?

Lord Tyler: My Lords, there are, of course, two further stages after Committee-Report and Third Reading.

Lord Crickhowell: My Lords, I asked a perfectly straightforward question. The noble Lord said that he needs three days in Committee. The Leader of the House will wind up the debate and will be able to tell him whether he will get three days. If he does not, what will he do?

Lord Tyler: My Lords, until we see how many amendments there are and your Lordships' House is given the opportunity to consider them very carefully in Committee, I do not understand how it is possible to decide whether this issue has been addressed.

Lord Low of Dalston: My Lords, can I sharpen the question a little? How will the noble Lord review the situation if the House has already passed a Motion this evening to put this Bill through Committee on a fast-track process?

Lord Tyler: My Lords, the Leader of the House has already indicated in her earlier remarks that she is prepared to consider how much time is afforded for the Committee stage of this Bill. That seems to me a perfectly reasonable response to the concerns expressed on all sides of your Lordships' House. The point I am simply trying to make is-

The Earl of Onslow: My Lords, if the Leader of the House were to get up now and say yes to three days or no to three days, that would ease the noble Lord's dilemma, would it not? If she were to say no to three days, he would then have to become unimpaled from the fence.

Lord Tyler: My Lords, if the Leader of the House wishes to give an indication of what she is intending to do with the Committee stage of this Bill, it would indeed be very helpful-not just to myself, but to all Members of your Lordships' House.

Perhaps I might now consider some of the issues that have been addressed during the debate, because it is my duty to try and respond to some of those issues. The Leader of the House, in her response, may be able to make it clear how she intends to square the circle between the sovereignty of Parliament and our mutual desire-I hope it is a mutual desire, on all sides

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of your Lordships' House-that there be an independent initiative in the setting and enforcing of MPs' pay and allowances.

For example, will the adopted route be that the IPSA will put an entire scheme before Parliament to accept or reject, rather than have the present situation, from which I have suffered on a number of occasions, where the House has a mush of Motions from which MPs can cherry pick carrots and then discard the sticks?

Clause 4 provides for the IPSA-

Lord Bassam of Brighton: My Lords, I ask that the noble Lord, Lord Tyler, is listened to respectfully. This is an important debate. The House is behaving somewhat unreasonably. Can we kindly listen to the noble Lord, Lord Tyler?

Lord Tyler: My Lords, I have never had a government Whip come to my help in that way; I hope that is not a bad sign.

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