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I shall say a quick word on the environment and renewable sources of energy. A new Government is a time to take stock. I am not opposed to wind farms but I listened with care to what the noble Lord, Lord Oxburgh, said. Are they likely to prove economic and to justify the level of investment and subsidy involved? I hope we will also give new impetus to nuclear power, and I was glad to hear that mentioned by the Minister. We already buy a substantial proportion of our electricity from French nuclear installations. The problems of waste exist but are far from insurmountable. Nuclear power will, in the words of the gracious Speech,

I shall say a brief sentence on the plans for the reform of Parliament. Whatever system emerges, the essential requirement is that it should attract to both Houses people of the right calibre who are ready, willing and able to do the work. They must be able to live reasonable lives with clear, straightforward rules on pay, taxes and expenses as similar as possible to those that apply to all other citizens.

This, I believe, is a time not only of great challenge but of genuine hope, and I feel privileged perhaps to be able to play a further part.

5.47 pm

Lord Haskel: My Lords, I, too, congratulate noble Lords opposite. I wish them every success. I also welcome the fact that a new generation has taken over.

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This is particularly apparent to me because the people with the real power in this Government are the same age as my children. Of course, it is absolutely right that a new generation should take over but there is one thing that worries me. My children and their friends hardly seem to be able to organise themselves, never mind organise the country, so the more mature members of the Government-such as the noble Baroness, Lady Wilcox, who opened this debate with such skill-will have to practise both ministerial and other skills. Indeed, her magic is already working. Instead of fighting each other, the boys and their gangs are playing together. This calms everybody down-especially those who do not really want to play because they do not like the rules-so well done there.

Today's debate is about business and economics, and I start with the politics of this. When we last had a Conservative Government-when I first came into your Lordships' House-we were told that we had to choose between a strong economy and a fair society. The two were mutually exclusive. It was John Smith and new Labour that turned that argument on its head, and for 13 years we had a Government who believed in a strong economy and a fair society going hand in hand. Indeed, that is what brought me into politics, and that is why under Tony Blair and Gordon Brown this country has become more prosperous, better educated and a healthier, nicer, more tolerant and greener place to live. I say to my noble friend Lord Myners: yes, I am proud of that. However, what I want to know is: will this Government continue with this policy? Even in an age of austerity, it must be right.

Turning to banking, it is wrong to delay action in favour of a technical review. During the election campaign one thing that came over strongly was how angry people are at having to bail out the banks and the effect that that has had on the real economy. The election may have toned it down, but the anger is still there and it will come back with compound interest. Inevitably, that will lead to a sense of betrayal. Wholesale reform is required now, not reviews and tinkering with regulation.

The coalition agreement has quite a lot to say about regulation and red tape. All new Governments start with a promise to cut red tape and regulation, but this Government promise to cut it and introduce new regulation at the same time. On the page of the coalition agreement which promises cuts, we are told that the banking regulatory system will be entirely reformed and bonuses will be regulated. My noble friend Lord Myners spoke about that. We are told that regulators will have new powers to define and ban excessive interest rates on credit cards and other examples are scattered through the document, such as the right to request flexible working and equal pay. I hesitate to ask how all this will operate with the one-in one-out rule, especially when the public use their promised right to challenge regulations. In reality, you have to deal with market failure; that is what you want the citizen to tell you about. Of course, poor and outdated regulation needs to be cut, but the real threat to innovation and enterprise is the absence of competition through unregulated market failure. By concentrating on the populist and ignoring the important, the Government have got this the wrong way round.

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Innovation and enterprise brings me to the business section of the coalition agreement, where there are indications of some of the ways in which the Government will help business, but on the overall context within which business operates the paper is silent. Will we continue to be a champion for open markets and, if so, how will we achieve this when we all agree that economic power is moving east? Although these new strong economies have joined the G20 to play by the existing rules, we know that their participation is about writing new rules. Unless those rules create a level playing field, our commitment to being an open market champion could make us very vulnerable. I think we should know what the Government's views are on world trade.

Perhaps the Government do not really care. In spite of their fine words, maybe the Government have no confidence in British business and industry. After all, on page 7 of the coalition agreement, they refer to it as "rubble". We have many fine businesses in this country-my noble friend Lord Bhattacharyya listed some of them-and to refer to them as "rubble" is a disgrace. That is yet another example of this Government's apparent fondness for running down Britain. I am sure that many noble Lords opposite feel rather embarrassed about that. We all go into politics to make a difference and I hope that this coalition will make a difference, not just to the country, but for the country.

5.53 pm

Baroness Garden of Frognal: My Lords, I too welcome the Minister to her new post and look forward to working with new-found professional friends in this legislative programme. The first priority in the Queen's Speech is,

In this wide-ranging debate, I shall focus on using the talents and skills of the whole workforce to best effect.

Under the previous Administration, apprenticeships increased from around 65,000 to 250,000, with a completion rate of more than 70 per cent. That has to be a very worthy achievement. We warmly welcome the announcement last week of investment in a further 50,000 apprenticeships, with £150 million diverted from Train to Gain. That will be particularly relevant for adult apprentices, where the demand has been the greatest. Many of those might be within the public sector and it will be a challenge to ensure that placements can be taken up in the face of cutbacks in public sector employees. It is essential to engage the next generation in meaningful training for work, to re-skill adults, to encourage aspiration and to reward achievement.

Craft, manufacturing and service industries all have the potential to increase their productivity even in times of hardship. As the Minister indicated, crucial to that growth will be small businesses which will benefit from the intention that:

"The cost of bureaucracy ... will be reduced"-

a very welcome intention.

The stringent cuts ahead should not be allowed to reduce opportunities for creativity and enterprise. What more can be done? One question we could ask is: why is it that women, who demonstrate great initiative and

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enterprise in other countries, are only in the UK half as likely as men to start up their own businesses? To that end, we have long argued for improvements in careers information, advice and guidance. It is not too soon to set out to children at secondary-even primary-school the range and variety of practical jobs which call for vocational skills and to interest them in business. Career ambition and aspiration is not just for academic and professional walks of life. Students should be aware of the opportunities which speak to their individual talents and motivation, whether for economics or catering, astrophysics or car repair, philosophy or care-and none of these is, of course, mutually exclusive.

Recent research from the City & Guilds Centre for Skills Development drew two important lessons: first, that vocational education works best when delivered in partnership with the community, including local employers and parents; and secondly, that the programmes are most successful when both vocational and academic learning are well integrated. We shall have a golden opportunity next year to raise the profile of vocational achievement when London plays host to the WorldSkills Competition. It can be inspirational to witness the levels of skills from young people at such competitions, and a challenge to our workforce to rival the best in the world.

Practical skills have key parts to play in economic regeneration, but so, too, must we concentrate on the country's poor record of financial literacy. We battled in the last Session to have personal, social, health and economic education made statutory in schools and just lost that valuable measure in the final hours of the previous Government.

Personal debt in this country has long exceeded £1 trillion, too much of it unsecured and unmanaged. We are paying the price of lack of corporate financial literacy in the banking crisis. Ensuring that young people start in life with the basic tools of financial management will pay short- and long-term dividends for individuals and for the nation.

The positioning of further and higher education within the Department for Business, Innovation and Skills is indicative of the economic impact of these sectors. However, this does not in any way detract from the invaluable academic, social and cultural aspects of our lives. Will the Minister, in response, give assurances that universities and further education colleges will be supported in maintaining the highest standards of teaching and learning; that their administrative burdens will be eased; and that funding will reflect the long-term contribution they make to individual well-being and the national economy? We look forward to lively and productive debates as we find new ways of working collaboratively in the coalition Government.

5.58 pm

Lord Monson: My Lords, the gracious Speech emphasised the Government's commitment to freedom, fairness and responsibility-an admirable set of objectives on which I congratulate the coalition. How do specific legislative proposals in the gracious Speech measure up to these criteria?

One of today's themes is agriculture. The space allotted to agriculture in the Conservative manifesto

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was rather thin and insubstantial, as Alice Thomson pointed out in the Times shortly before the election. Many more words were devoted to conservation, biodiversity and so on than to the growing of food, the plight of the hill farmer and the like. However, right at the end a brief reference was made to the Hunting Act, saying, in essence, that it ought to be repealed because it has "proved unworkable". Well, that is largely true, but it is scarcely the main reason for having it repealed. The main reason is that the Act flies in the face of the principles of freedom and fairness.

I have no interest to declare, as neither I nor any of my family hunts, but I know many people who do from a surprisingly wide occupational spectrum. They are understandably aggrieved that this part of our rural heritage has been outlawed because of a majority who were mainly guided by emotion rather than by a cool, objective examination of the evidence. Rest assured that I will certainly not try to go through all the arguments again, but the fact remains that the great majority of veterinary surgeons and other animal experts and no fewer than four former directors of the League Against Cruel Sports have come to the conclusion that hunting is the least cruel way of controlling the fox population and that, on balance, foxes have suffered more since the ban than before, to say nothing of the extra suffering to livestock arising from a larger fox population.

One accepts that freedom needs to be tempered with responsibility. The noble Baroness, Lady Golding, who sits on the Labour Benches, together with Mr Lembit Öpik, who until recently graced the Liberal Democrat Benches in the other place, as well as others, put an enormous amount of hard and constructive work into helping to form the Middle Way Group, which rightly seeks to discipline that small minority of hunts that condone abuses or show lack of consideration to third parties. That was not only wrong but disastrous for the image of hunting. The middle way is the British way and surely the route that we should follow.

Unfortunately, the Prime Minister, Mr Cameron, and everyone in this country who would like to see an end to the hunting ban are all too likely to be stymied by what is the complete reverse of fairness. Realistically, I see no problem from Northern Ireland. However, honourable Members representing Scottish constituencies are a different matter. The Scots, like the Northern Irish, have unfettered power to make their own laws for hunting on their own territory, but the English and Welsh are denied that right. Is that really fair? Surely it is not, as most of the electorate in Scotland and Northern Ireland would almost certainly agree. In the absence of long-overdue self-government for the English on purely domestic matters-that need not cost money, as there would be no need for hugely expensive Assembly buildings-one fears that repeal of the Hunting Act is unlikely in this Parliament unless all MPs representing Scottish and Northern Ireland constituencies were involuntarily to abstain in any Division on a hunting Bill, which I suspect is asking for the moon.

There are so many other Bad Laws, to use the name of an excellent book by Philip Johnston, that need repealing that it would take most of the night to list

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them, but let us hope that the coalition's slogan-freedom, fairness and responsibility-is indeed a binding promise, not simply a vague aspiration to be discarded when convenient.

6.03 pm

The Lord Bishop of Ripon and Leeds: My Lords, I first acknowledge the need so well expressed in the coalition document and the gracious Speech to reduce our national deficit and, alongside that, the moral dilemma faced by the Government in just how to do that. I want to explore that.

The most basic principle needs to be that those with the broadest shoulders should bear the heaviest burden. There is much more in the gracious Speech and its notes about cuts than there is about taxation, although there is a reference to fairer taxation, and I look forward to discovering just what that means. I hope that the Government will acknowledge that fiscal adjustments are also there to be used as a part of the economic proposals. Our taxes are not simply a way of purchasing public services; they are also the charge that we pay for the opportunities and security that go with a nation where social bonds are strong. Mutual responsibility must be recognised as the key to our social fabric. Those who have done best out of the boom years should be at the forefront of the desire for generosity in a more astringent economy.

Some of us are old enough to have been brought up on that oft repeated cartoon from an earlier period of austerity in which a row of men-I fear that they are all men-are on a ladder rising from a flood, with the rich man at the top, the middle-class man below him, then the worker and then the unemployed at the bottom, his head barely clear of the water. The rich man is saying, "Equality of sacrifice. That's the spirit. Let's all take one step down". It is that sort of inequality dressed up as equality that we need to avoid in our society.

Does the Minister accept the thesis of Richard Wilkinson and Kate Pickett in The Spirit Level, which has been cited several times in this House, that it is disparity of wealth that is most deeply damaging to society? Material inequality is harmful not only to those who are poor but also to those who find themselves having to protect themselves from resentment and discord. The last thing that we want is a gated society.

The notes in the reports that accompany the gracious Speech speak of the importance of mutuals and co-operatives in delivering public sector service. I welcome that emphasis, but I look to hear more about how that principle of mutuality is to be exercised in the economic sphere. What encouragement will there be of mutuals, from building societies to credit unions, to take a much more prominent place in the financial sector? Will the Government consider mutualisation as a way forward for the Royal Mail, with its unique loyalty to the Crown, and therefore to the whole of our society? Will its commitment to serving the whole of the population be preserved and nurtured? That will be one test for the concept of a big society, ensuring that that is more than a fig leaf for getting volunteers to deliver the state's welfare obligations.

Welfare is in danger of following asylum as a term of abuse rather than of mutual generosity. The

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Government need to affirm and to celebrate welfare. One of the most distinguished previous occupants of these Benches, William Temple, coined the phrase "welfare state" in order to distinguish it from the "power state", where those with wealth and power exercised coercive control over the citizens. The need for welfare at the heart of the state is as dramatic now as it was 60 or 70 years ago.

Finally, I highlight the needs of the third sector-not much referred to so far in this debate-because the third sector provides so much to enhance our mutual responsibility. Work in Leeds to enhance the learning of English, to encourage integration and to support children is holding its breath. Money destined for that work now appears to be threatened as departments assess their priorities. It is important for the Minister to reaffirm today the Government's support for local initiatives-both by local authorities and by the third sector-which do so much to create that mutual dependence on which we rely for a flourishing culture, whether in times of affluence or in times of austerity.

6.09 pm

Lord Jenkin of Roding: My Lords, I hope that the right reverend Prelate will forgive me if I do not follow on from his speech. I would like to say a few words about the subject touched on earlier by my noble friend Lord Teverson and the noble Lord, Lord Oxburgh, and talk about energy.

Let me say at once that I very much welcome what my noble friend on the Front Bench said about the future of new nuclear build. She will be aware that some anxiety was voiced when the Secretary of State at DECC was appointed, having regard to his well publicised, long-standing opposition to the nuclear industry. However, having read the coalition programme and read his speech in another place last week, I am now wholly reassured that the policy will continue as it has in the past and that we will get the new nuclear programme that is essential to the security to which the noble Lord, Lord Oxburgh, referred. I say to the Benches opposite that the only sadness is that it has all come 10 years too late because they thought they were winding up the nuclear industry and only discovered a few years ago that that would not be possible.

I also welcome the coalition's policy statement about the need for a floor under the carbon price. This is widely regarded as essential by the nuclear industry. It is a crucial provision because it makes it clear that there must be a major incentive for low-carbon generation and a difference between that and higher-carbon generators. I understand that it is a matter for the Treasury-I am mildly surprised, but I am told that that is the case-and that DECC Ministers are hopeful that something may be said about it in the emergency Budget. All I would say to my noble friends on the Front Bench is that it would be a welcome assurance that would help to counter the uncertainty that is the real enemy of investment in this field.

Another anxiety that has been expressed by the industry is about changes that my noble friends have announced for the planning system, in particular, the abolition of the Infrastructure Planning Commission. I find it very reassuring that the Government have

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made it clear that the IPC will be abolished as a decision-making quango, but that its staff and the people who have been recruited to the commission will make sure that the application and planning processes for major infrastructure projects will continue and will be part of the Planning Inspectorate, with the hugely important change that final decisions will be made not by an independent quango but by Ministers accountable to Parliament. I was in touch with the chairman of the IPC, Sir Michael Pitt, before the election, and I discussed these proposals in detail with him. I was greatly reassured when he said that he regarded them as entirely workable. I hope that Ministers in the Department for Communities and Local Government, who are in charge of the planning system, will do their best to see that planning timetables will be no longer, and possibly shorter, than those envisaged in the Planning Act 2008.

In the last couple of minutes, I shall mention climate change. There is time to do only one thing: to draw the attention of the Government to a very important new report, called The Hartwell Paper-because it was put together at a conference at Hartwell House-describing a new direction for climate policy after the crash of 2009. We have had the failure of Governments to reduce carbon emissions under the Kyoto process. We have had the failure, which has been referred to more than once in this debate, of the Copenhagen process. We are also faced with the rising tide of public scepticism about climate change. They all inevitably lead to the likely failure of the successors to Copenhagen. There is not time even to outline the case made in The Hartwell Paper. I hope that it will be given attention because the theory behind it is that if you make cutting carbon and climate change the central objective, requiring unpopular decisions to be taken by a range of people, you are bound to fail. I shall quote one of the authors of the paper:

"It is not possible to have a 'climate policy' that has emissions reduction as the all-encompassing and driving goal. We advocate inverting and fragmenting the conventional approach: accepting that taming climate change will only be achieved successfully as a benefit contingent upon other goals that are politically attractive and relentlessly pragmatic".

Those are the conclusions of a long, carefully argued paper, but I have come to the conclusion that if we are to fight climate change and reduce emissions, we cannot, to coin a phrase, go on as we are.

6.15 pm

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