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Public Bodies Bill [HL]

Committee (8th Day) (Continued)

9.06 pm

Schedule 2 : Power to merge: bodies and offices

Amendment 66

Moved by Lord Whitty

66: Schedule 2, page 18, leave out lines 6 to 8

Lord Whitty: My Lords, this is genuinely a probing amendment, and I shall not spend a lot of time on it. I suppose the probe could be distilled to the question: why? The Central Arbitration Committee and the Certification Officer vaguely operate in the same area

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of life and are indeed serviced by the staff of ACAS, but they do very different jobs. One of them is effectively an arbitrator and the other is a regulator. It is not normal to confuse the two roles. Indeed, confusing the two roles in other fields is generally frowned upon, particularly in the area of regulation where the role of the regulator as against the role of the ombudsman is kept very distinct. They are slightly different in that the CAC acts as an arbitrator between trade unions and employers, in the main, and in some specified statutory functions, whereas the certification officer effectively regulates the internal affairs of trade unions, employers' associations and other friendly societies.

The fact that they are drawn from two bits of the secretariat of ACAS does not mean that the two secretariats can be merged without causing some difficulties. The cost saving seems to me to be negligible, if it is positive at all. Inside information tells me that it might save one photocopier and possibly a fax machine as well, but that is likely to be offset by the increased cost of having two headings on the notepaper for the new organisation, the name of which has presumably yet to be devised.

My more serious point is that there is a potential conflict of interest here unless the two secretariats remain seriously Chinese-walled. Somebody who is dealing with a dispute between a trade union and an employer should not be the same person who is dealing with an issue between a trade union and one of its members. Unless those two duties are kept separate, there is a potential or apparent conflict of interest. This has worked perfectly well hitherto, and there have been no great hiccups. The two organisations perform different roles, and I do not see the point. Perhaps the Minister can explain. I beg to move.

Baroness Royall of Blaisdon: My Lords, I think my noble friend has said it all. I am grateful to him for raising the proposed merger of these two bodies. Here we have two small but very important organisations that deal with related areas of law but are distinct in their functions. As my noble friend said, one is a regulator and one is an arbitrator. It is fair to say that everybody who knows the two organisations, the people involved and their work is bemused about why they are being merged. They wonder whether it is just a paper exercise in order simply to decrease the number of quangos. The cost savings are potentially very small. I will be grateful if the Minister will tell me what costs will be saved. My noble friend made a point about the separation that must exist between the two functions. It is extremely important that there should be walls, be they Chinese or otherwise, and we need to know that they will exist if the two bodies are merged.

Lord Taylor of Holbeach: I thank the noble Lord for moving this amendment. He very effectively described the functions of both bodies. They have both existed for many years, and both operate in the sensitive area of trade union and industrial relations law. I stress that the Government value their roles. They are both expert in their respective fields, and they both enjoy solid reputations for impartiality. The similarities do not end there. They both undertake judicial functions,

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they have a shared understanding of judicial procedures, their officeholders and support staff both possess detailed knowledge of trade unions and of industrial relations more broadly. Both bodies are relatively small and are both housed in the same building. They both receive administrative support from ACAS-the Advisory, Conciliation and Arbitration Service. There is therefore already significant linkage between the two bodies, and the Bill will take that process a stage further by merging them. Some efficiency savings will be produced as a result, but I have to say to the noble Baroness, Lady Royall, that they are not likely to be huge. The total budget costs for both organisations are about £1.25 million, so the efficiency savings will not be huge, but there will be some. In particular, their support staff could be deployed more flexibly to meet the peaks and troughs of case loads.

A merger would also simplify the institutional landscape and avoid any potential confusion in the eyes of users about their respective roles. Therefore, the Government consider that a merger is advantageous to all concerned. A merger will not affect the underlying law which these bodies help to enforce. I should add that the Government have no plans as a consequence of this merger to change the various rights and duties embodied in trade union law. Our intention is to ensure that the merger will not affect the experience of persons, be they individuals, unions or employer groups, who currently use the services of these bodies. In particular, we want to maintain the same procedures which the CAC and the CO currently apply when considering their respective cases. BIS, which has a lead responsibility for these two bodies, has already discussed the potential merger with the CAC, the CO and ACAS, and has sought the views of the TUC and the CBI. We believe that we have reached an understanding on how a workable merger can be achieved.

In summary, there is a strong case for these two small bodies to be merged. We believe that this can be achieved without prejudicing in any way the performance of their important and sensitive duties, and I hope that the noble Lord will feel able to withdraw his amendment.

Lord Whitty: Well, my Lords, that was a bit thin. The Government are keeping the functions of the two organisations, which they recognise are distinct. The organisations already have good administrative support and operate quite sensibly, and there is virtually no cost saving, if any. The one point that he made with which I disagree is that the users of those organisations know perfectly well what they are for, and they are distinct. If a member has a complaint about his trade union, he does not want an arbitrator, he wants someone to tell that trade union that it has been acting against its own rules in the way in which it has dealt with him, whereas the CAC is in essence an arbitrator. The Government wish to make this tidier, and BIS wants to cross another organisation off the list. I am not going to make a big point about this, but the reality is that there is no rationalisation, no overlap and no administrative saving. There is, however, a lingering doubt that there might be some conflict of interest when the noble Lord talks about rationalising the role of the two secretariats. That might come back and bite

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us, although the probability of that happening is fairly low. Nevertheless, it is still there, and the appearance of a Chinese wall will at least be necessary, in which case any administrative rationalisation will be even less. I will not press this amendment tonight and I will not press it again, although I do think that the Government's argument is a bit thin. I beg leave to withdraw the amendment.

Amendment 66 withdrawn.

9.15 pm

Amendment 66A

Moved by Lord Faulkner of Worcester

66A: Schedule 2, page 18, leave out lines 9 to 11

Lord Faulkner of Worcester: My Lords, I, too, will be brief. In moving Amendment 66A, I do not oppose the Government's decision to merge the Gambling Commission and the National Lottery Commission. Indeed, I strongly support that for reasons I will explain. I believe that it would be helpful for the Committee to hear more about the Government's plans for the regulation of gambling. The suggestion that the National Lottery should be regulated by the Gambling Commission first surfaced in the report of the Joint Scrutiny Committee on the draft Gambling Bill published in April 2004. I had the privilege of serving on that committee, along with seven other Members of your Lordships' House, two of whom I am delighted to see in the Chamber-the noble Lord, Lord Mancroft, and my noble friend Lady Golding.

I recall that the committee spent a considerable amount of time considering whether there should be a single regulator. The Joint Committee heard evidence in favour of the proposition from a variety of witnesses, including the Royal College of Psychiatrists, which stated that,

The then Government, in the form of the Secretary of State for Culture, Media and Sport, said to the draft scrutiny committee that,

My much-missed friend, the late Lord McIntosh of Haringey, added that,

I think that I speak for most members of the Joint Scrutiny Committee if I say that we found this last argument a little hard to follow. Ever since the National Lottery was introduced in the mid-1990s it has enjoyed a protected and somewhat contradictory regulatory environment where its regulator is supposed to reconcile the two conflicting aims of protecting players and at the same time encouraging them to spend as much as possible on lottery products so as to fulfil their remit

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of maximising the return to good causes. In the end, we came to the conclusion expressed in paragraph 126 of our report, which states:

"The Committee is attracted to the idea of a single regulator, and takes the view that there would be distinct advantages for the National Lottery if it were to be included within the remit of the Gambling Commission rather than excluded from it as proposed in Clause 222 of the draft Bill. We are not convinced that the proposed structure will ensure consistency of approach across the gambling sector, particularly on key issues such as problem gambling and player protection".

How very interesting that this Government have come to the same view.

However, I am bound to ask the Minister whether the Government have thought through all the issues. Have they, for example, decided that there is no longer the need for a statutory body which has within its remit the encouragement of people to spend more on lottery products so as to maximise the return to good causes? If that is what they are saying, I would have no problem with that as I have always taken the view that it is the job of a lottery operator rather than the state to promote lottery gambling. But that is a significant change of policy to which we will need to return to debate it at greater length. Where they would get into real difficulty is if they gave the Gambling Commission the job of promoting the lottery as well as regulating it. I should like to be reassured that that is not what they are planning.

I should make clear again that I am not opposed to the merging of the National Lottery Commission and the Gambling Commission. I just want to be assured that Ministers have thought through the consequences, as I believe we did on the Joint Scrutiny Committee seven years ago, and that they have a clear idea of how these potentially conflicting interests can be reconciled. I beg to move.

Baroness Thornton: My Lords, 72 per cent of the population gambled in the past year, so it is important that we get the regulation of gambling, whether it is through the National Lottery or at a casino, right. I took part as a Back-Bencher in the passage of the Gambling Act through your Lordships' House with particular reference to the consequences for children and young people, which is why I am here today.

The Gambling Commission has been a great success as our regulatory body for most, if not all, gambling. As my noble friend said, it regulates betting, bingo, casinos, slot machines and lotteries, but not spread betting or the National Lottery. Its aims are to keep crime out of gambling, to ensure that gambling is conducted fairly and openly and to protect children and young people. Like my noble friend, I have some questions to ask.

The first question is to do with reconciling the contradictions in the proposal in relation to a body such as the National Lottery Commission, which promotes the success of the National Lottery in order to ensure that it makes a great deal of money for good causes but is also there to safeguard people from the dangers of gambling.

The Gambling Commission does three things extremely well and I should like to know what will happen to them in any new organisation. The commission is

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responsible for the Responsible Gambling Fund and the Gambling Research, Education and Treatment Foundation, both of which are relatively new bodies. The bulk of the money from the Responsible Gambling Fund goes to the work of GamCare, which does a very important job in helping people and families with gambling problems. I should like to know whether the work of GamCare will be jeopardised. The GREaT Foundation raises the required funding to support the work of the Responsible Gambling Fund. What will happen to these bodies under the new regime?

My third question concerns what will happen to the British Gambling Prevalence Survey, which has been an important spotlight that the Gambling Commission has shone on the gambling habits of the nation. It tells us who is gambling, how they are gambling and what the dangers are. I would be interested to know what is going to happen to that survey.

I started by being concerned, as I was while the Gambling Bill was going through this House, about the protection of the young. One of the great successes of the Gambling Act 2005 has been the introduction of age verification technology, which is part of the protection making online gambling that much safer for children and young people. I know that the National Lottery has the same sort of age verification safeguards, so I am reassured by that, but I would like to think that any new body would take heed of the need to protect children and young people from new technology as it advances in terms of gambling.

Baroness Rawlings: My Lords, Amendment 66A moved by the noble Lord, Lord Faulkner, would remove the Gambling Commission and the National Lottery Commission from Schedule 2 and therefore retain the existing arrangements of two separate bodies. As the previous Administration had announced their intention to merge the two commissions in its last Budget on 24 March 2010, I am surprised that there should be a challenge to the proposal now. The Government are committed to increasing the accountability and reducing the number and cost of public bodies. We believe that merging the Gambling Commission and the National Lottery Commission will help to achieve this aim while preserving the appropriate and effective regulation of both sectors.

The National Lottery Commission is a non-departmental public body responsible for licensing and regulating the National Lottery, including protecting the interests of its participants and maximising the amount of money available for good causes. The Gambling Commission is an NDPB responsible for regulating commercial gambling, along with providing advice to central and local government on gambling and its regulation.

The new body, to answer the question put by the noble Baroness, Lady Thornton, will retain the existing functions of both commissions and will be well placed to advise on gambling and National Lottery matters. It will make co-ordination of regulation easier and will facilitate greater understanding of gaming and technological developments. Both bodies worked with the department to develop the business case for the merger. The chairmen and chief executives of both bodies discussed it with the Minister for Tourism and

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Heritage before it was agreed. The department has set up a project board to take forward work in relation to the merger, and the chief executives of both bodies sit on it. We estimate that the merged body will be in place from summer 2012, with some co-location of the bodies in advance of that.

The Government believe that, over time, the merger will generate cost savings and more efficiencies, which should help to reduce pressures on existing sources of funding, including fees. For example, we anticipate that by far the greater part of the NLC's annual budget for accommodation will be saved. Specifically, the Government expect the new merged body to manage on the same administrative budget as the existing Gambling Commission. On whether GamCare will be protected and on the future of the British Gambling Prevalence Survey, I will write to the noble Baroness. In light of my explanation, I should like the noble Lord to withdraw his amendment.

Lord Faulkner of Worcester: My Lords, I made it clear in my opening sentence that the purpose of tabling the amendment was not to challenge the decision to merge the two bodies; the point of a probing amendment is to give us the opportunity to ask some questions. The main question that I asked was whether the new body would have the function of promoting the National Lottery in the way that the National Lottery Commission has had till now-in other words, encouraging people to spend money on it at the same time as regulating it and attempting to protect the public. I say with great respect to the Minister that she has not answered that question. If she is writing to my noble friend in response to her question about GamCare, perhaps she will be kind enough to write to me as well. Certainly at this time of night, and on an issue that I agree is not absolutely central to the Bill, although it is still important, I do not intend to press the amendment.

Baroness Rawlings: I will of course write to the noble Lord. I apologise for not giving him the information earlier.

Lord Faulkner of Worcester: I beg leave to withdraw the amendment, but look forward to hearing from the Minister in due course.

Amendment 66A withdrawn.

Amendment 67 had been withdrawn from the Marshalled List.

Amendments 67A and 67B not moved.

Schedule 2 agreed.

Clause 3 : Power to modify constitutional arrangements

Amendment 68

Moved by Lord Hunt of Kings Heath

68: Clause 3, page 2, line 11, at beginning insert "Subject to section (Restrictions on ministerial powers),"



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Amendment 68 agreed.

Amendments 69 to 69A not moved.

Debate on whether Clause 3 should stand part of the Bill.

Lord Hunt of Kings Heath: My Lords, this debate relates to the order-making power given to Ministers in relation to the constitutional arrangements of the bodies listed in Schedule 3. I am concerned that very considerable power is given to Ministers in this Bill, and this is an example of that.

Perhaps I may reiterate a point that I made when we started scrutinising this Bill some few weeks ago: we have no objection in principle to a proper review of the public bodies contained in the Bill and to their abolition if they have reached the end of their useful life. Nor do I doubt the need for such bodies to be appropriately accountable to Ministers. However, there also has to be some distance and independence. There is clearly no point in having a public if it does not feel that it has independence. That is why I am worried about the effect of the power in Clause 3. It has the potential for a chilling impact on the behaviour of boards. If boards are aware that, on a whim, a minister can get rid of the chair and members through an order-making power, that would have an undue influence on their behaviour. We will come later to a similar amendment to Schedule 4 in relation to the financial arrangements.

9.30 pm

One would be more reassured if the noble Lord, Lord Taylor, were able to give some comfort about the general architecture of the Bill. I refer him to two points. First, it will be interesting at some stage to have the Government's view on what have come to be known as sunset clauses. In other words, if this provision related to an individual body for a limited length of time and then ceased to apply to that body, I would be much more relaxed about the provisions. Equally, we will debate on Wednesday the issue of another order-making power. The noble Lord will have seen the latest report of the appropriate Select Committee in relation to his amendments, but at this stage I would like to give him an opportunity to explain why this schedule is in the Bill. He will understand that my attitude towards it will be shaped by the eventual architecture of the rest of the Bill.

Lord Taylor of Holbeach: My Lords, I thank the noble Lord for this opportunity. We are making progress in a direction with which he will be content and with which I am content. Perhaps I can bring together the various changes that have been made as a result of our amendments.

As the noble Lord rightly points out, this group of amendments deals with Clauses 3 and 4. Clause 3 gives a Minister the power to make provision, by order, to alter the constitutional arrangements of any body or any office listed in Schedule 3-but only those listed in Schedule 3. Of course, now that Schedule 7 has gone, the list is finite. For example, in the case of the Theatres Trust, we intend to do away with the

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Secretary of State's role in the appointments process, which will increase the body's independence as it moves towards charitable status.

The noble Lord referred to Clause 4, which is a parallel clause with different purposes-it concerns funding arrangements-but is structured in the same way. Clause 4 confers on the Minister the power to make an order modifying the funding arrangements of a body or office listed in Schedule 4. In this regard-I am giving examples which I hope demonstrate the purpose to which these clauses will be put-the Government intend to reform the Drinking Water Inspectorate by allowing it to recover its costs from the water industry, bringing this body into line with the existing principle that it is the businesses which benefit from regulation, not the taxpayer, who should bear the cost of the regulation. The previous Government concurred with this approach.

In considering these clauses as a whole, I understand that the noble Lord is primarily concerned that these powers could be used to restrict the independence of bodies. Indeed, the noble Lord said that one of his anxieties was that, by granting Ministers the power to amend the governance or funding arrangements of bodies, the Bill would enable Ministers to threaten the position of chairs or board members who have displeased the Government, or constrain the ability of a body to carry out its work by squeezing its functions. While I seek to reassure the House that the Government have no intention of acting in such a manner, I understand the sentiment behind these concerns. However, the appropriate way to deal with them is to place appropriate limits on the power of Ministers to act, both within the Bill and elsewhere, rather than to abandon the powers altogether.

As with all the principal order making powers in the Bill, the uses of Clauses 3 and 4 are restricted by the conditions described in Clause 8 and elsewhere. Under the proposed government amendments, Ministers would be required to set out the rationale for an order in an explanatory memorandum when laying a draft order before Parliament. I explained that in a previous debate on an amendment tabled by the noble Lord, Lord Whitty. Ministers would thus be held accountable for the use of the power in relation to the particular considerations in the Bill, including the effectiveness of public functions. A change in funding which, for example, would leave a body unable to carry out its public functions properly would be unlikely to meet this objective. I cannot envisage a situation in which a Minister would wish to make such an order. I can further assure the House that in light in particular of today's third report from the Delegated Powers Committee, the Government are considering whether it is necessary to clarify Clause 8 further. I hope that that provides some reassurance to the noble Lord, Lord Whitty, in light of his previous amendments.

It is also important to remind the House that we are continuing to engage with the noble Lord, Lord Lester, and other noble Lords in relation to his Amendment 175, with the intention of ensuring that the safeguards applying to the order-making powers in the Bill include appropriate protection for the necessary independence of public functions. Furthermore, as I have said, the

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removal of Schedule 7 from the Bill will ensure that no body or office can be listed in Schedules 3 and 4 and be subject to the powers there unless its inclusion has been approved by Parliament through primary legislation. I hope that this change to the structure of the Bill provides the House with a strong reassurance that full parliamentary scrutiny will be central to the operation of these powers.

In addition to the protections present and planned for the Bill itself, there are safeguards which rightly limit the power of Ministers. First, in terms of appointments and governance, chairs and board members are in most cases appointed in line with rules issued by the independent Commissioner for Public Appointments. This ensures that appointments are made on merit following an open and transparent process. The Government are further committed to strengthening the role of Select Committees to scrutinise major appointments, giving Parliament an effective voice in the process. In addition, for certain appointees who must be demonstrably independent of Ministers, the terms and conditions or relevant statute will provide safeguards to reinforce the officeholder. This might include pre-appointment scrutiny by Parliament or appointing certain officeholders on a single, non-renewable term so that the decisions and actions of those officeholders are not, and are not perceived to be, motivated by a desire to be reappointed. Examples of office holders listed within the Public Bodies Bill that fall within these categories include the chair of the Equality and Human Rights Commission and the chairs of regulatory bodies such as Ofcom.

I wish to emphasis the Government's position that it is right for Ministers to have a role in public appointments and the governance of public bodies. The Commissioner for Public Appointments code of practice clearly states that the ultimate responsibility for making public appointments rests with Ministers. Ministers should remain answerable and accountable for the overall performance of public bodies and have the ability and authority to intervene if a body is failing. This must include the ability, in extreme cases, to remove board members. The balance that the Government must strike, met by the safeguards I have described, is to retain this principle of accountability while ensuring that public bodies are able to act independently of ministerial influence where required.

That is also the case in relation to the powers in Clause 4, which relates to funding mechanisms. The Government's position is that ultimate decisions on the allocation of funding must rest with Ministers, who are ultimately accountable for the delivery of public service by central government and for public expenditure within their spending review settlements. It is for precisely that reason that it is against Cabinet Office rules, for example, for public bodies to use public funds to employ PR or marketing consultants to lobby government or Parliament for more funding. We could not support amendments to Clause 4 which would risk undermining that principle. It is also right that Ministers have the assurance that public money is being spent appropriately. In the case of most NDPBs, Ministers and departments must be consulted by public bodies before they exercise certain financial powers such as borrowing or capital expenditure. We believe

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that the powers that Clause 4 would confer on Ministers are entirely in keeping with this position; they do not establish a new status quo but rather reaffirm ministerial accountability for public expenditure.

It is taxpayers who ultimately fund public bodies in most cases, and I am confident in suggesting that the citizens of this country expect government to account for its use of their money, no matter by whom it is eventually spent. On this basis, I believe that the removal of Clause 3 or 4 from the Bill would be a disproportionate measure, as it would remove Ministers' ability to take forward the type of changes that I described earlier and instead require primary legislation for such changes, regardless of their nature. As well as preventing or delaying sensible reforms, the removal of Clauses 3 and 4 would run contrary to the principle of ministerial accountability for the performance of public bodies and their use of taxpayers' money. While I agree with noble Lords who have highlighted the need to safeguard the independent delivery of some public functions, I believe that this can and should be achieved through other means, such as the safeguards within the Bill and outside it.

I am sorry to have taken some time over this, but this explanation probably goes to the heart of many of the concerns that noble Lords have expressed about how the Bill empowers Ministers and the balances that we seek to set within the architecture of the Bill to ensure that this is not abused. On this basis, I contend that both clauses should stand part of the Bill. In the light of the reassurance that I have supplied, I seek the noble Lord's support on this. Furthermore, I ask the noble Lord, Lord Whitty, whose amendment is I think included in this grouping, not to press his amendment.

Lord Hunt of Kings Heath: My Lords, I thank the noble Lord, Lord Taylor, for a full response to the issues raised. He went a very long way to reassuring me about how this will operate. I do not disagree with him when he says that ultimately Ministers must be accountable. I very much agree with that, but it is also my contention that there is very little point in setting up these bodies unless they, too, have a degree of independence of judgment. The concern has always been that some of the clauses in the Bill will hang like a sword of Damocles over those bodies and inhibit their independence. I take very much the point that the Minister raised that one critical issue here is Clause 8 and the matters to be considered by Ministers when making an order under Clauses 1 to 6. I know that there is a lot of discussion taking place about this, and I hope that there will be a positive outcome. It also takes place in the context of Clause 10 and the order-making procedure. We will come to that in a couple of days' time. But the Minister has reassured me to a very great extent tonight on this particular matter.

Clause 3, as amended, agreed.

Schedule 3 : Power to modify constitutional arrangements: bodies and offices

Amendment 70

Moved by Lord Judd

70: Schedule 3, page 18, line 21, leave out "Broads Authority."



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Lord Judd: My Lords, I am not quite sure what has happened to the noble Lord, Lord Greaves. I hope that nothing awful has happened to him at the hands of the hard men of the coalition.

The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Henley): I assure the noble Lord that the hard men have done nothing. All I am advised is that he is ill.

9.45 pm

Lord Judd: In the noble Lord's absence, I beg leave to move this amendment and to speak to its group. I should perhaps remind the Committee of my interests: I am a vice-president of Campaign for National Parks and president of the Friends of the Lake District, an area that includes a very fine national park. At the outset, I shall say a word on why the parks matter, because this amendment is not free-standing but relates to their purpose. In our stressed society, many would argue that the parks have become more important than ever as a place for spiritual and physical renewal. They also have a tremendous contribution to make in the sphere of biodiversity and, potentially, a significant part to play in combating carbon pollution and all the rest.

We have yet to hear why the inclusion of national parks authorities and the Broads Authority in this Bill is either appropriate or necessary. The suggestion that their inclusion is to give them more flexibility in operating does not, frankly, sit comfortably with the extent of ministerial diktat that the Bill will provide. Most of the provisions are, in any case, unnecessary given the flexibility that already exists within the Local Government Acts and Part 8 of the Natural Environment and Rural Communities Act 2006-or NERC, as it is known-on administrative arrangements. National parks authorities and the Broads Authority are, as they were originally described, special-purpose local authorities, but this level of intrusion by the national Government of the day threatens to undermine their independence. This group of amendments would remove national parks authorities and the Broads Authority from the Bill and, I assure the Committee, therefore have widespread support.

Clause 3 appears to give Ministers the power to change many aspects of how national parks authorities work, including their name, their accountability to Ministers, their powers to employ staff, the number of members, the procedures for member appointment and, indeed, the appointment of the chair. The concern reflected in these amendments is about the extent of the power that would be given to Ministers to alter the composition of those authorities and the Broads Authority. Defra has linked this clause to the current consultation on the governance of national parks authorities, which aims to improve their local accountability. However, the consultation is based on six simple, open questions and, until we have a clear picture of the response to them, it is surely not possible to propose what, if any, constitutional changes might be right. Indeed, including such far-reaching provisions in the Bill to deliver outcomes that have not yet been established is, I suggest, obviously premature.



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Schedule 3 does not seem necessary given the flexibility that already exists in Part 8 of the NERC Act 2006. If, as I gather Defra has suggested, the intention is to provide greater flexibility for amending the membership of the Broads Authority, only that authority should be mentioned and only in relation to the specific issue of membership, not the wide range of constitutional issues listed in Clause 3.

Clause 5 gives the Minister the power to transfer the national parks authorities' functions to an eligible person or to modify those functions by order. In practice, that would mean that, if a national park authority or the Broads Authority upset the Minister of the day through its planning decisions, the Minister could order that authority to transfer its land-use planning functions to the department, to another local authority or to a company limited by guarantee and so on. This would mean that the authorities would be constantly living with the potential threat of having powers taken away in the event of an unpopular decision, but one that would be right in terms of the purposes of the parks. That would inevitably have consequences for their freedom to operate, their willingness to innovate and, potentially, the robustness of their decision-making.

At this point I should put a question to the Minister: how do the Government value the three provisions in relation to the functions of the national parks authorities and the Broads Authority-statutory functions, such as the land-use planning functions and other detailed matters such as the making of tree preservation orders, and any function, statutory or discretionary, that the authority might undertake to deliver its statutory purposes? Those purposes are set out in Section 5 of the National Parks and Access to the Countryside Act 1949. They are,

and,

There is of course an additional purpose where the Broads are concerned, relating to navigation. I suggest that it is highly disturbing that under the terms of the Bill Ministers could change the purposes for which national parks and the Broads have been designated by order rather than through primary legislation. That is a significant and sweeping proposal.

Clause 6 gives the Minister the power to make provision by order to authorise the national park authority or the Broads Authority to delegate some or all of its functions to an eligible person, including another local authority, a company limited by guarantee or the Minister himself. While this does not explicitly relate to an authority's planning function, it is rather hard to imagine what else it could be about. National parks authorities and the Broads Authority can currently choose to enter into agency agreements with other authorities on the delivery of their development control function, as is happening in the newly established South Downs National Park. This arrangement ensures that the authority remains ultimately responsible for the delivery of the development control function and that it is able to monitor and, where necessary, amend arrangements so that they do not prejudice the delivery

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of park purposes. Full delegation would not give it the same ability to monitor arrangements, as it would be delegating responsibility for them to another body. Significantly, the transfer parts of Schedule 5 and all of Schedule 6 can already be achieved using Part 8 of the NERC Act. Unlike under Clause 5(1)(b), a transfer could be done then only with the agreement of the authority.

Clause 8 requires Ministers to have regard to various objectives in considering whether to make an order under Sections 1 to 6. Surely, if we ever have this clause, it ought to require Ministers to be able to demonstrate that these objectives will be met, rather than merely having regard to them.

I have had all sorts of reassurances from Ministers about their intentions and their commitment to the parks and I genuinely believe that what they are saying is what they believe. I respect them for that, but I suggest that it is unfortunate that the parks and the Broads Authority were brought within the Bill, as they have an immensely important role to fulfil. I see some noble Lords present who from time to time have had quite acute criticisms of the parks, but those criticisms can be taken up with the park authorities as they stand and are established. I ask the Minister to consider seriously the intention of these amendments and I hope that what he says tonight will meet some of the concerns that I have expressed. I beg to move.

Lord Maclennan of Rogart: My Lords, my noble friend Lord Greaves, from his bed of sickness, asked me to intervene in this debate to make a few points. The noble Lord, Lord Judd, has made many of those points, which will inevitably shorten the remarks that I feel obliged to make. In a sense, I will underline the principles that he raised.

The first question that I put to the Minister is: how are we and those who care about the national parks to divine what the coalition Government seek to achieve by the inclusion of the national parks authorities in Schedules 3, 5 and 6? The coalition agreement indicated:

"We will review the governance arrangements of National Parks in order to increase local accountability".

At the time, that was taken to mean considering the possibility of the direct election of the indirectly appointed council members of the national parks authorities, although that was not made explicit. However, that is what the authorities considered that it indicated.

The second issue, which was referred to by the noble Lord, Lord Judd, is about the Defra consultation. The consultation asked six questions, but those questions did not bring great clarity to what the Government had in mind by including them in the consultation. They were very open questions about whether the membership of the authorities should be changed and whether the process for selection could be improved. There was certainly no reference to direct election in place of indirect election from the local authorities. I understand that the consultation is now complete and the answers were submitted to the Government on 1 February. It would be of interest to know what the Government's response to that process is and what conclusions they have drawn from the submissions that have been made.



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The third issue is to discover which powers and functions of the national parks authorities the Government have in mind to alter and in what way. The national parks authorities are essentially hybrids: they are partly quangos but they have local authority functions, including particularly powerful functions in respect of planning and development, which could be and are exercised by local authorities in other parts of the country. This raises the question of how any change would have the effect of devolving more powers to the localities if what the Government seek is more influence over the direction of decision-making.

It may be thought that the powers already exist to provide for greater flexibility through the Natural Environment and Rural Communities Act 2006, which the noble Lord, Lord Judd, also referred to. The Act specifically provides for flexible administrative arrangements for designated bodies, including the national parks authorities. Consequently, it appears that the only reason why this measure might be considered necessary, and for including these authorities in the Bill, is that the approval of the Secretary of State is not sufficient under the 2006 Act. The proposals must be approved by the national parks authorities. On the face if it, this looks as though it is a direct transfer of authority to the Secretary of State. That may not be the intention, but we need to hear what the Government have in mind.

It is clear that there is already grave disquiet among the national parks authorities about the inclusion of this provision in the Bill. Many of the friends organisations, those who live in the national parks and some who are employed by the authorities are considerably concerned about it. If the Government are not able to give a precise indication of the purposes of this inclusion in terms of restructuring, I predict that there could be a considerable backlash from the public. I do not say that it will necessarily be on the scale of that aroused by the forestry provisions, but no one should underestimate the regard and affection felt by many people for the national parks, not only by those living in and depending on the organisation and management of the national parks but by those who see them as an important escape from the pressures of life. Those people are deeply concerned that the 9.3 per cent of our country that is included in the 10 national parks in England should be maintained with its heritage, beauty, natural conservation and many of the other fortunate happenings in these areas. I hope that the Minister will reply to these questions, which certainly exercise many people around the country.

10 pm

Lord Deben: My Lords, I hope very much that we maintain the more than 9 per cent of the country which is so protected. However, I do not suggest that the national parks should always go on in exactly the same way and that the elected Government should not interfere with them in any way. For four years I was responsible for the national parks. I do not think that anybody could have criticised the way in which I sought to protect the countryside. However, the national parks are a problem because in many ways their structures do not meet today's needs. It is perfectly true that you could suggest that Ministers may not behave perfectly

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but to seek to protect a section of the population and more than 9 per cent of the land to the extent that no one can propose necessary alterations is unacceptable. Such a situation has arisen only once before in connection with the church. I much prefer the church to be in that position, as long as it is the true church, but that is a different issue. I say that in the presence of the right reverend Prelates. It is difficult to defend the argument that a certain organisation should be immune from government concern and the necessity for the Government to deal with the nation as a whole.

A national park, which will be nameless, seemed to me to represent neither the people it was supposed to represent nor the people who lived in its area. As Secretary of State there was nothing I could do to protect them against the pretty extreme decisions that the relevant national park authority took. We have to have a balance here. The way in which Ministers have explained how they intend to use this provision leads me to believe that we have the right balance. It is not acceptable to believe that the only way you can protect this area of Britain is by exempting a particular structure from any kind of debate. All that this provision seeks to do is to give the Government the opportunity to represent the generality of the population's relationship with the particularity of the national parks.

I therefore hope that Ministers will not give way to these proposals but will seek of course to give maximum independence to the national parks. However, in the end, Ministers have to uphold the interests of the generality of the public and it seems unacceptable to have a system which excludes them from doing so. Having been in that position, I believe that I was not able properly to protect people in certain national parks from the way in which institutions operated, because they were so independent that there could be no second choice. That is not acceptable in a democratic society, particularly when a national park authority is not directly elected or when the people concerned are not in that position.

I very much hope that Ministers will accept the good offices and good grace of the noble Lord, Lord Judd, but accept also that many people who live in the national parks are hoping for a proper way in which the fiat of a national park authority could, at least at some stage, be questioned by those who are elected. I therefore very much support this part of the clause.

Lord Berkeley: My Lords, it is interesting to follow the noble Lord, Lord Deben. My interest is in the Norfolk Broads, rather than the national parks. I note that in the coalition agreement the Broads Authority was not included in the same bracket of potential changes.

My interest in the Norfolk Broads came from having the privilege of chairing a Select Committee when the Broads Authority brought forward a private Bill to change its structure. It was interesting listening to the different petitions made over a number of days. There was the challenge of balancing the conservation and navigational issues, and of balancing the interests of those who wanted to drive motor boats at high speed and those who wanted to sail in comparatively narrow areas. The most important issue that came out of that

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evidence was that all the people who petitioned had the interests of the Broads at heart. Most of them, but not all, lived locally and were prepared to accept a structure and compromise that gave them as much of what they wanted as they recognised was reasonable. That represents a much better way of managing an area such as the Norfolk Broads than doing it by central government. However, we can probably debate that later.

I asked the Broads Authority whether it had been consulted by the Government about these potential changes. It was very brave to put its answer in writing, which stated that the authority had not had any detailed discussions with the Government. That is rather sad, actually. Surely the whole point of these potential changes is that the Government should consult the people involved. The authority is very concerned about its inclusion in Schedules 3, 5, 6 and 7. That is a pretty wide range of options that cannot give the authority much comfort as to where it will go. Its feeling, which I fully support, is that it would not mind if its name was changed to the "Broads National Park", but that that would change the emphasis of its objectives and how they were implemented. Not only that, but the conservation budget has to be kept separate from the leisure budget, and there are special arrangements for navigation officers and so on. The authority was also concerned about the governance procedures and worried that the Government would be getting into too much detail. There was also the potential for changes to the reports and accounts process.

I have not heard anything so far that indicates that there would be benefit to the inclusion of the Broads Authority in any of these schedules. If it has to be in one, it believes that Schedule 3 is the least bad. The Broads Authority spent a lot of effort putting through the private Bill. It cost time and money, much of which came from its users. Why should it not be allowed to get on with what it does pretty well rather than having yet further uncertainty and changes? The Minister may have some different ideas about this, in which case I should be very pleased to hear them.

Lord Cameron of Dillington: My Lords, like many noble Lords, I have a great love for and affinity to our national parks. In my case, that probably stems from the fact that I was conceived at about the time of the legislation in 1949 and came into the world roughly when it received Royal Assent. However, in my capacity as chairman of the Countryside Agency, I have also had the privilege of overseeing the creation of two of the more recent additions to the national park family-the New Forest and the South Downs.

Our national parks are very special and they are unique to the UK. They are not wide, open, wilderness spaces, as in less densely populated countries; they are parks for a crowded nation in the 21st century. The Peak District National Park, for example, has, I believe, some 21 million people living within an hour's drive of it. It is a very special place and has very special value because of that fact. Our national parks also have very special governance arrangements, and rightly so. Although they are privately owned, they are politically managed in terms of their appearance-the planning aspects-their environmental characteristics, their economic and social

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well-being and their accessibility. All that comes about through a fine balance between local government and the local people, and they bring benefits to the nation as a whole. Of course, that fine balance has been thrashed out in various bits of legislation since 1949 and it is something that we tamper with at our peril.

I realise that the Government are currently going through a consultation on the precise form of local representation regarding the national parks, and that is absolutely right. There have been problems with some local representation in some national parks in the past. I am sure that in today's big society improvements can be made to the local representation, but I wonder whether we need the heavy hand of Schedules 3, 5 and 6 to achieve this. As ever, these schedules might be satisfactory and mean no harm to the national parks in the hands of today's Ministers. I am sure that the Minister shares our love of national parks and can reassure us that his Government have no wish to interfere with the unique planning powers that keep them so special, even when those planning powers are delegated to others, as with the South Downs. However, what of the future? Should we allow Schedules 3, 5 and 6 to stand indefinitely as a threat to national park authorities? Even if the current Government's honourable intentions are spelt out clearly for now, it seems to me that the Bill would be better off with greater clarity and also with a sunset clause. I noticed that the noble Lord, Lord Taylor, in responding to the stand part debate on Clause 3, steered towards responding to the sunset clause, but he seemed to veer away from it at the end. Perhaps I got that wrong and did not quite understand what he was saying, but it would be interesting to have some clarity on that.

10.15 pm

Baroness Quin: My Lords, the Public Bodies Bill contains many important bodies but it is somewhat frustrating to have to deal with important bodies such as these at something of an unsocial hour. However, I am very grateful to my noble friend Lord Judd for speaking to the amendments in the way that he did, and indeed for moving Amendment 70 in the absence of the noble Lord, Lord Greaves, to whom we wish a very speedy recovery.

These amendments relate to important bodies which are well established and, as the noble Lord, Lord Maclennan, said, rightly attract a great deal of public enthusiasm and support. Therefore, we need to scrutinise this part of the Bill very carefully.

All noble Lords who have spoken in the debate have tried to get at the Government's thinking regarding these bodies and why they have been incorporated into the Bill. Certainly, the attachment to the national parks and the Norfolk Broads is very clear-cut. The creation of national parks has been a big event ever since the Act of 1949, the designation of the first park being the Peak District. For our part, the Labour Government are proud of having presided over the creation of two new national parks in the New Forest and the South Downs.

As well as public support for the national parks, there is already a long-standing campaign for them, to which the noble Lord, Lord Judd, referred; he also

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referred to his role in that campaign. In a briefing, the Campaign for National Parks has submitted its views on the inclusion of national parks in this part of the Bill. I shall not read that out, but many of the points in the briefing have already been referred to by many noble Lords. I hope that the Government will look at the briefing carefully and respond to it before Report so that we feel we are better informed about the Government's attitude and their intentions.

At present, as noble Lords have pointed out, there is a considerable amount of uncertainty. My noble friend Lord Hunt referred to the sword of Damocles hanging over organisations. There is a worry that what is being proposed will undermine the independence and the basic purposes of these organisations. Again, for that reason, I urge the Minister to give us some reassurance about what the Government have in mind on these issues. In many ways, it seems that we are doing things the wrong way round but, if the Government have certain changes in mind, they should come forward with them and try to make a convincing case for them, then have the consultation and then make the decision about the way forward. Putting national parks in the Bill appears to pre-empt the consultation, which has just closed, on the future governance arrangements of the parks.

My noble friend Lord Berkeley said that he understood that there had been no real consultation or discussion with the Government about the Norfolk Broads. I hope that the Government will address that point in reply. We have had consultation, which is something, but it would be good to have from the Minister a flavour of the results of that consultation and any interim thinking within the Government as a result of the responses to the consultation.

A number of noble Lords, including my noble friend Lord Judd, asked whether the provisions in the Bill were necessary because it seemed that they could be covered by other legislation already in force, particularly the Natural Environment and Rural Communities Act 2006. I am not absolutely clear whether that would cover the Norfolk Broads as well as the national parks. There seem to be claims that it could and claims that it could not, but perhaps that is something which the Minister could clarify in his response.

I say to the noble Lord, Lord Deben, that I do not think anyone on this side is saying that things should be ossified for all time in terms of national parks or the Norfolk Broads or any other organisation. None the less, as the noble Lord, Lord Cameron, said, these schedules seem to be a rather heavy-handed way of approaching the issue. He also came out with an interesting thesis that perhaps we were influenced by legislation passed at the time when we were conceived or born. I was trying to think what might have been on the statute book when I was born but I do not know. Perhaps we should all check as a result of what he has said.

The Norfolk Broads were referred to by my noble friend Lord Berkeley. They seem to be very much akin to a national park but they have the additional special requirement that they have to protect navigation. They have the roles of conserving wildlife, enhancing natural heritage, promoting opportunities for understanding

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and enjoyment of the area, and have regard to the economic and social interests of those who live and work there. Therefore, it seems that we are talking about organisations which broadly have the same functions and purposes, whether it be the Norfolk Broads or the national parks.

More uncertainty has been created when there is already uncertainty because of the difficult decisions on funding that have to be taken. I know that there is considerable concern in my local national park in Northumberland at present. Indeed, a letter has been issued for a claim for judicial review because of the lack of consultation and the feeling that this has not been a fair and transparent process. We are talking here of people who are not natural opponents of the Government but who feel seriously about their responsibilities and want to have the necessary resources to carry them out.

The government amendment makes clear that we are dealing only with national parks in England. I understand that, but I hope that the Government will discuss with the devolved authorities the way forward for national parks-not in any way to impinge on the devolution settlement; that is the last thing I would want given the recent vote in Wales. However, the national parks are a precious asset for all of us. There must be many people in England who treasure Snowdonia, just as there are many people in the Scottish Borders who treasure Northumberland. For those reasons, I hope that there will be proper discussion with the devolved Administrations.

In conclusion, the Government's reaction is extremely important. We need reassurance about the valuable role that those organisations play. Given their popularity in the country as a whole, the Government tamper with them at their peril.

Lord Henley: My Lords, I will speak to Amendment 70 and all the amendments that go with it, and obviously address the government amendments, Amendments 74A, 95A and 105ZA. I will not comment on what legislation was going through when I was born, as did the noble Lord, Lord Cameron of Dillington. The noble Baroness, Lady Quin, rather coyly refused to comment on what legislation might have been going through when she was born. Those are matters for all of us to think of in due course.

I underline and fully accept what the noble Lord, Lord Judd, said, about the importance of national parks and their iconic nature-the fact that they are national parks. As my noble friend Lord Deben said, they cover 9 per cent of the land area of England- or is it the UK? I forget which, but it is large. As my noble friend said-he did not use these words but I think that he would accept them-they should not be cast in stone. He did not want them to be protected in the way that some of the church lands were in the past until Henry VIII appeared. I am no Henry VIII on this occasion. I want full protection of the national parks and I want them to work as best they can. I hope that in dealing with the amendments I can assure the House that that is exactly what we are going about.



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Currently, they are managed by bespoke public authorities. I make the point that they are bespoke and vary from authority to authority. They are not identical. They are constructed on local government lines, but those authorities have been doing an excellent job since they came into being, some as long ago as 1948, when the noble Lord, Lord Cameron, was conceived-or was it when he was born?-and for a long time since.

Just as they have been doing an excellent job, the local authorities, and the planning boards which preceded them-in some cases, until much later, thinking of the more recent national parks-also did a very good job. However, those authorities now face the challenge of ensuring that they can continue to deliver their core purposes in very different times: in what-dare I say it?-are rather straitened times. They seek to minimise the impact of the spending reductions on their front-line services and see how they can continue to improve what they can offer in some areas.

National park authorities have a long tradition of managing very small budgets, engaging with their local communities and making very good use of volunteers. That experience will serve them well in devising innovative approaches to delivering key services in future. The important point to get across-this is dealing with the points raised by the noble Lord, Lord Judd, particularly when he discussed the six questions that were put by the Government to the national parks authorities and others in that consultation-is what they do in the future. We are currently considering the responses to that consultation on their governance arrangements and honouring the commitment made in the coalition agreement. The consultation closed on 1 February, and we are committed to announcing the outcome of that by the end of March. I can give an assurance to the noble Lord, Lord Berkeley, that the Broads Authority was consulted, as were all the other authorities, about what was going to happen and what it thought would happen. The six questions were put to it, and it was made aware of what the Bill would allow Defra and it to do. It might be that the Broads Authority and some of the others do not feel that they were consulted enough. If that is the case, the door will still be open, and my honourable and right honourable friends will listen to what they have to say.

Lord Berkeley: I shall quote from an e-mail from the chief executive of the Broads Authority dated 29 November, which is when I thought we were going to start discussing this. He stated:

"We haven't had any detailed discussions with the Government".

Lord Henley: The noble Lord said that the e-mail was dated 29 November. That is some months ago. My assurance is that there have been discussions with the Broads Authority. I will certainly write to the noble Lord if that is not the case, but the assurance I am giving to the Committee is that there have been discussions and consultations and we will certainly listen to what it has to say.

Each national park authority and the Broads Authority have suggested improvements which meet the needs of each individual authority. I go back to the words I used earlier: "bespoke arrangements". They each have different needs that must be met, reflecting the expectations

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of the people who live in, work in or engage with the national park or the Broads Authority. Their suggestions will form the basis of the agreed outcomes which we plan to announce before the end of the month. If the noble Lord is worried that consultation has not been open enough, and I have heard criticisms of consultations that have not been open enough, I refer him to the letter sent out by my honourable friend Mr Benyon in August last year. I think it is worth quoting the penultimate paragraph:

"I can assure you that, at this stage, I have no fixed view. I am well aware of the strong feelings any review will generate. I also appreciate that National Parks differ greatly in how they are run and how they are accountable and engage with the local population. The Department and I are approaching this process in an open and transparent manner with no pre-conceived formula for National Park structures or governance".

The noble Lord could not wish that to be more open or transparent. It is there on the table in writing. We will continue to offer that openness and transparency.

Provisions in the Bill will allow us to work quickly, effectively and flexibly with all those authorities to review all key aspects of their governance arrangements. It is governance arrangements that we are discussing. It is not some sword of Damocles that is being held over them, as noble Lords are implying. It will allow the national park authorities to focus resources on the key tasks that can be delivered only through the authorities themselves while also formally permitting other groups, of which there are many, with a real and supportive interest in national parks to take forward functions where it is appropriate so to do.

10.30 pm

I will say a brief word or two about government Amendments 74A, 95A and 105ZA, which merely restrict Ministers' order-making power to national park authorities in England. That is particularly appropriate in the light of the recent referendum in Wales, which will in due course extend what the Welsh Administration can do. The corresponding powers for Welsh Ministers will be contained in the clauses that we will relate to the changes to be made in Wales. Obviously we will discuss all these matters with the devolved Administrations where appropriate, whether in Wales, in Scotland or even, although I do not think it is appropriate, in Northern Ireland.

I hope that, with those explanations, the noble Lord will feel able, possibly after consulting the noble Lord, Lord Greaves, if he is in communication with him on his sickbed, to withdraw his amendment at this stage.

Lord Judd: My Lords, first, I thank everyone who has participated in this very interesting debate, not least the Minister for his reply. It has been good, in particular, to have the full-hearted support of those on my own Front Bench. I thank them very much for that.

I must say that if we wanted an indication of the quality and significance of the parks, to which noble Lords have already referred, it was epitomised by the noble Lord, Lord Cameron, when he talked about the coincidence between his arrival into the world and the creation of the parks. It is good to have him on side as well.



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I am also very grateful to the noble Lord, Lord Maclennan, who referred to the strength of feeling among the public about the importance of the parks. Indeed, in every survey of public opinion, a very large majority of the population has said how much it believes the parks matter. That places a heavy responsibility on all of us.

The noble Lord, Lord Deben, introduced some very important points and did so very reasonably. Of course, ultimately, the Secretary of State has responsibilities for things that happen in his sphere, but the noble Lord also said that this should be decentralised as far as possible. That is the balance that has to be struck. As always in these things, this is not just about the words but about the driving energy behind it all. I ask the Minister to accept-I think he has recognised this-that there is a real anxiety that this could give an awful lot of power to Ministers with very few checks and balances. That issue still has to be addressed, and I really would be grateful if the Minister could come back on Report with more specific proposals on how that anxiety could be met.

Lord Henley: It might assist the noble Lord if I remind him of the timing of this Bill. I do not think that we will get to this bit of Report until after Easter. We will certainly have completed the consultation, and will therefore have made one or two noises, if I can put it in those terms, between this stage of the Bill and the next stage. That is on the understanding that we have the usual two weeks between stages, depending on when the Bill finishes. However many days we have on Report, I do not think, as I said, that we will get to this bit of the Bill much before or much after Easter.

Lord Judd: Those are encouraging words indeed from the Minister. Indeed, his noble friend, who has been leading on this Bill, has made similarly encouraging remarks to me outside the Chamber. We wait to see what happens, but the more that can specifically be said to meet the outcome of the consultation the better.

I was going to make the point that the parks authorities are in a sense trustees of this very special inheritance of the nation, and trustees should be independent and should feel able to be independent. They have the job of striking a balance between the communities who live in the parks and the national interest, because the parks are national parks for the enjoyment and regeneration of the population of the nation as a whole. It is a balance to be struck and the park authorities, in their independence as trustees, are well placed to do that. It is free of the hurly-burly of political considerations as they come up tactically, not least towards election times and things of this sort.

My anxiety is not that we will wake up one day and find that the parks have gone but that my grandsons may come to inherit a sort of rather nice home county as distinct from the national park as it should and could be. In my view, if we take the spiritual needs and the needs of a stressed and hard-working nation seriously, the national parks should be a place of contrast. The job of the trustees is to keep that contrast and not just to turn it into an extension of suburban Britain.



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In thanking those who have participated, I should also say that it was good to have the special knowledge of my noble friend Lord Berkeley. I want to demonstrate to the noble Lord, Lord Deben, among others, how seriously I take this point. I am a great admirer of the national parks in the United States. They are very exciting, fine places, which have survived different administrations, but they are wildernesses. We have a much more difficult and delicate task because ours have living communities in them and the situation is not the same. I would argue therefore paradoxically that that is why trustees with independence in the form of the park authorities are so important so that they can make their judgments as objectively as possible.

I thank all those who have participated and the Minister for his response, which, I dare to say, was encouraging. I look forward to what he will be able to say at later stages when the consultation is complete. I beg leave to withdraw the amendment.

Amendment 70 withdrawn.

Amendment 70A

Moved by Lord Inglewood

70A: Schedule 3, page 18, line 21, at end insert-

"Church Commissioners."

Lord Inglewood: My Lords, this probing amendment is specifically triggered by the announcement last autumn from the Church Commissioners in which they declared their intention to sell 12 paintings by Zurbarán, which are currently in Auckland Castle, County Durham. At that time it also appeared that they wished to sell the castle, but it now seems that they may have changed their mind. It was also prompted by the commissioners' plans to sell Rose Castle, the traditional see house of the Bishops of Carlisle and one of the few places away from here where in the reign of King Edward I the English Parliaments met, and the apparent estate management muddles at Hartlebury Castle, the traditional see house of the Bishops of Worcester. Each of these bishops' palaces and its contents is by any definition part of our national patrimony. For those of your Lordships who do not know them, they are described in the Durham, Cumbria and Worcestershire volumes of the Pevsner's Buildings of England series, which are in the Queen's Room in the Library. Ownership of these assets has devolved to the Church Commissioners, a public body set up by Parliament, inter alia, to hold the church's property in a fiduciary capacity. They are in no legal sense part of the Church of England.

Traditionally, the bishops' palaces and their associated assets, which might in shorthand terms be described as church treasures, were the property of the diocesan bishop for the time being. They were only finally vested in the Church Commissioners under the terms of the Episcopal Endowments and Stipends Measure 1943. Interestingly, the terms of the measure indicate that, in respect of this class of asset, they are not held charitably, which contrasts with the endowments of the church also held by the commissioners-those which inter alia go back to the ecclesiastical commissioners and Queen Anne's bounty-which are held charitably. Clearly, different considerations apply to the different classes.



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One of my personal, political concerns is the preservation of our heritage and I have been involved over the years in a number of ways. I also happen to have lived all my life in Cumbria and to have close family connections with County Durham where once, spectacularly ineffectively, I stood for the European Parliament. While I myself confess to a personal preference for bishops living in bishops' palaces, just as I think the Queen should live at Buckingham Palace and the Duke of Devonshire at Chatsworth, I accept entirely that, as times change, this may no longer be appropriate. However, in such circumstances I do think it is important, in the wider public interest, that the buildings are not simply sold to the highest bidder, but rather an appropriate future use is found for them, ideally from my perspective with some diocesan involvement. I should add that I am also a communicating, albeit somewhat inadequate, Anglican. I believe as well that the best way of trying to take things forward in circumstances such as this is by discussion and negotiation rather than by confrontation. To that end I and some like-minded colleagues approached the Church Commissioners to see how that might be achieved for Rose Castle, and a number of cordial meetings have been held with the Church Commissioners and their officials, at some of which I have been present. The commissioners are aware of my amendment.

On each occasion, I was struck by the commissioners' proposition at the heart of the debate that, once a see house is declared unsuitable by the commissioners, it then becomes part of the church's endowment and can therefore subsequently be handled only in order to achieve the maximum financial benefit for the Church of England, that being an inevitable consequence of being charitable. This proposition worried me. I do not want to make any claims for my abilities as a lawyer, but it felt all wrong in the terms in which it was put. Over a period of weeks and months I kept on thinking about this and could not reconcile myself to it. Finally, not all that long ago, I turned to the Episcopal Endowments and Stipends Measure 1943, and I have to admit that I was extremely startled by what I found. I must apologise to your Lordships because my remarks now become a trifle esoteric, not least since I dare say that, over the years, the Episcopal Endowments and Stipends Measure 1943 has rarely been mentioned in this Chamber.

I was surprised because inter alia the measure contains quite comprehensive stipulations regarding see houses, their adaptation and disposal in order to safeguard-to use a shorthand form of words-their heritage, importance and value. In the case of Rose, I knew that the steps had not been taken. It crossed my mind that it was conceivable that the commissioners might have unilaterally flouted the statutory requirements, but I have to admit that I did not think that was very likely. I therefore read the measure in detail and with considerable care, and I suddenly realised that, because of what I am sure was probably a drafting error, it appeared that it might be argued that the commissioners could go through what looks like a loophole and entirely get round the protection offered by the measure. Clearly, that is one of its most fundamental purposes.

By virtue of the provision at paragraph 3(1)(c) enabling the commissioners "otherwise to dispose" of

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a see house, the safeguards expressly in place to protect such houses in the case of demolition, conversion or sale have been-I am sure unintentionally, as I have said already-entirely bypassed. By the device of transferring, that is, disposing, of the see house into another category of asset that they hold as an endowment, the commissioners now appear to be arguing that they are obliged to turn them into cash cows. I have serious doubts about the legal effectiveness of this, but as I have already mentioned, I do not want to claim to be a better lawyer than I am. Hence I have sought and been given some informal advice by a Chancery lawyer that, in his view, this probably does not work. Nevertheless, it might be, as the commissioners are arguing, an ingenious way of selling one's own or, for that matter, yours and my heritage for a mess of pottage. The transfer would have the effect of the philosopher's stone in turning a see house subject to significant heritage obligations into gold. It is a form of money laundering which looks as if it may be being used to get round the clearly laid out purposes of the law of the land in order to benefit the commissioners. Even if it is a legally effective course of action, which I doubt, this seems to be a quite unacceptable exercise of its powers by a public body. In my opinion, the behaviour of the commissioners needs to be looked at. The Public Bodies Bill-as I have said, the Church Commissioners are a public body-gives the Minister powers to effect changes to the governance of bodies by order. I think we should think about this.

However, I shall conclude with three points. First, the Minister told me informally some time ago now, and before he had heard my remarks today, that while the Church Commissioners fell within the terms of the Long Title of the Bill, it was not government policy to deploy the powers in respect of them. Having heard what I have said, I hope that he will think on what I have been talking about. Secondly, through him and independently as a Member of this House, I would ask the Attorney-General, who one will appreciate is an ex-officio Church Commissioner, to look into this matter straightaway. In particular, and without prejudice to any other matters, will he consider whether what the commissioners are doing in these cases amounts to a disposal in the terms of the measure? If it does, is it being achieved by the commissioners in breach of their fiduciary duties? Thirdly, if the commissioners have behaved within the law, is their behaviour in all the circumstances an appropriate exercise of powers by a public body? Perhaps the Attorney-General would let me and the House know-before Report if he can-his general response to this request.

Finally, perhaps I may ask the right reverend Prelate to say on behalf of the commissioners whether, bearing mind what I have suggested and fear may happen, they will impose an immediate moratorium on all the manoeuvres and plans for sale in respect of these bishops' palaces until a thorough investigation is carried out. I beg to move.

10.45 pm

Lord Faulkner of Worcester: My Lords, I support Amendment 70A, to which I have added my name. The Committee should be greatly indebted to the noble Lord, Lord Inglewood, for tabling it. As far as I

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can establish, this is the first time for many years that your Lordships have had the opportunity to debate the activities of the Church Commissioners. My trawl of this House's Hansard for the past five years has not produced a single example. That is in contrast to the other place, where the Second Church Estates Commissioner answers Questions for up to 15 minutes every month. He represents the Church of England in the House of Commons. Curiously, seven Members of this House-two most reverend Primates, four right reverend Prelates and the Lord Speaker-are all currently Church Commissioners, yet none of them speaks officially for them. I understand that, until 1977, it was possible for Members of your Lordships' House to address questions to the Archbishop of Canterbury, but that was done away with on the advice of the Procedure Committee. Given what the noble Lord, Lord Inglewood, said about the de facto public body nature of the Church Commissioners and the fact that they appear to be exempt from the Freedom of Information Act, there appears to me to be an accountability deficit relating to their activities to which we should perhaps return on another occasion.

Perhaps I may use this opportunity briefly to express my concern over how the commissioners are managing and attempting to sell one of the finest see houses in the country, Hartlebury Castle-referred to by the noble Lord, Lord Inglewood-which was the home of the Bishops of Worcester from the 13th century up to 2007. It is a grade 1 listed building. It contains the magnificent Hurd Library, which was created in 1782 by Bishop Hurd, an ancestor of the noble Lord, Lord Hurd of Westwell, and is the last example in Britain of an integrated library containing the books for which it was originally created. There is also a great hall and a marvellous chapel, which reminded me when I went round it of the one depicted in the original television production of Brideshead Revisited.

Since 1966, the north wing of Hartlebury Castle has housed the Worcestershire County Museum, which also occupies a number of outbuildings on the site. In 2007, on the retirement of Bishop Selby, the commissioners decided that his successor, John Inge, should have his residence in the city of Worcester in a house by the cathedral and announced their intention to sell Hartlebury. That decision has aroused great controversy for the very reason that noble Lord, Lord Inglewood, gave; that is, the commissioners claim that their charity obligations require them to sell it to the highest bidder.

There are numerous other areas of concern, such as inadequate consultation with local interests, the lack of any strategy for dealing with historic assets, of which the Hurd Library is the prime example, and lack of care for the building. I am told that, during the recent cold spell, Hartlebury was heated for only four hours a day and, unsurprisingly, there were numerous burst pipes over Christmas, followed by floods that were unchecked for several days.

On the question of the sale, the commissioners are determined to put the house on the market in April 2012. In my view and that of the members of the Hartlebury Castle Preservation Trust, who are desperately attempting to raise the money-I declare an interest as one of their patrons-it is quite wrong for them to be

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driven only by a requirement to make the most from a sale that they can, regardless of how inappropriate the use to which any new owners may put the house. Surely it must be possible for this house, and the other see houses to which the noble Lord referred, to remain in public ownership with the running costs met by a body such as a charitable trust or, possibly, the National Trust. Something needs to be done to allow genuine local interests, who have a real vision of what these houses can contribute to the local community, to have their chance to show what they can do. That is why I strongly support the moratorium proposed by the noble Lord on the sale of other assets by the Church Commissioners. I hope that the Minister will agree and maybe, if one of the right reverend Prelates is able to contribute on behalf of the Church Commissioners, they will agree as well.

Lord Boswell of Aynho: My Lords, I, too, have appended my name to the amendment. I commend my noble friend Lord Inglewood for the erudition and articulacy of the case that he has put, particularly in relation to the legal arguments, which I am not competent to follow, and on the need for accountability of the Church Commissioners. I do not need to rehearse the arguments at length, but the debate so far has revealed a lacuna in our accountability. I say to the right reverend Prelates who are in their places that, in my experience of dealing with the Church of England and as a loyal Anglican who has dealt with legislation in another place, there is a need to articulate the interests of what might be termed the Bishops' Bench for shorthand and of the Church Commissioners, because it is not always clear that there is a united voice in these matters. So it has been right to expose the issue of accountability.

The second issue, about which many of us in the House feel strongly, is the need to preserve the heritage. I would not make this specific to the affairs of the Anglican Church but there are a number of people sitting on a number of trusts in different capacities who have heritage assets that may or may not have strayed into their ownership as a result of past arrangements. I am thinking, for example, of a certain involvement that I had with the Coram Foundation and the Foundling Hospital at one stage and the legally intense issues, some time ago, in terms of the disposition of their paintings; or, indeed, Royal Holloway College, at which one of my daughters was a student, and the Turners that it had to sell. There is a real tension and we should reflect on ways in which-rather along the lines of the work that my noble friend Lord Inglewood does in relation to the reviewing of the export of works of art-we can run some of these heritage issues past accountability before it is too late to do so.

I make those two points in the full knowledge-and, indeed, having discussed them with Mr Baldry, the Second Church Estates Commissioner, who used to be my constituency neighbour when I was in another place-that there are real issues for the resourcing of the Church of England. We fully understand that it must make the best use of its assets-it has an important pastoral task, to which I warm-but it must not do so

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at the expense of these other considerations. That it has a need for the money may be a necessary and appropriate argument, but it is not quite sufficient to justify everything that may have taken place, as described by my noble friends and others. This is an area in which we need to sharpen up and make sure that it is meeting its wider obligations as well as its specific and precise ones to resource the church.

Lord Howarth of Newport: My Lords, I am grateful to the noble Lord, Lord Inglewood, and his noble co-signatories for tabling the amendment. We have heard something of the present plight of Rose Castle and Hartlebury Castle and the great Hurd Library that it contains.

I was fortunate to be educated at the Winchester Cathedral choir school. As a little boy, I played cricket in the lee of the ruins of Wolvesey Castle, the old palace of the Bishops of Winchester. It sits close to the late 17th-century baroque palace, which I believe is still the residence of the right reverend Prelate the Bishop of Winchester, yet one wonders for how much longer, as the Church Commissioners seem determined to dispose of their patrimony.

The patrimony of the Church of England, our established church, is also the patrimony of the nation. Of course we recognise that the Church Commissioners have a responsibility to keep the Church of England afloat financially, to pay pensions and so forth. No one underestimates the difficult challenge in that, but the church's responsibility is not just to the material bottom line or to itself. It is far larger. The church's patrimony of buildings and art is essential to the physical and metaphorical fabric of the nation. The Church of England and our society remain inextricably members one of another. Many right reverend Prelates understand this entirely and are deeply committed to the preservation of the heritage that they have the privilege of presiding over.

In Norwich, the cathedral city in which I now live, there was recently an exhibition entitled "The Art of Faith: 3,500 Years of Art and Belief in Norfolk". Stephen Fry wrote, in a foreword to the catalogue, that the history of Christianity is,

As he put it, artefacts created as an expression of faith,

Gail Turner, reviewing the exhibition in the Times, wrote about the,

People making buildings and other artefacts as expressions of Christian faith have for millennia made sense for all of us of our place in the world.

The patrimony that the Church of England claims as its own has been paid for by the tithes, donations, rents, taxes and lottery tickets of the community. Whatever may be the formal legal position-the noble Lord, Lord Inglewood, explained to us that that is in significant respects doubtful-morally this patrimony belongs to us all. Some 45 per cent of grade 1 listed buildings are Church of England parish churches. The Church of England has been happy to benefit from the listed places of worship grants scheme that was

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negotiated by my right honourable friend Gordon Brown, when he was Chancellor of the Exchequer, and the most reverend Primate the Archbishop of Canterbury. It has been happy to benefit from the funding that English Heritage has been able to provide for cathedrals and for the repair grants for the places of worship programme jointly funded by English Heritage and the Heritage Lottery Fund.

When I was Minister for the Arts, deans of two of our great cathedrals came to see me to ask whether public money could be found to support cathedral choir schools. While, to my regret, the Arts Council was unable to accede to that request at the time, it was an entirely reasonable request, because cathedral music is the fountainhead of so much of the musical life of our nation. Hundreds and thousands of lay volunteers help to care for church buildings. There is a two-way obligation of mutual support between the church and society in respect of the heritage. The nation has a stake and a right in the music of the church and its cathedrals, its bishops' palaces and the works of art that are contained within them. This is all part of our national heritage and it is not simply for the Church Commissioners to sell off as they will.

It is not a question here of the bishop in his castle and the curate at his gate and of the church having some duty of radical equalisation in the accommodation arrangements for both. As the noble Lord, Lord Inglewood, suggested, as a society we want to be able to look up to bishops, just as we do in your Lordships' House. The people of this country do not want bishops to live in semi-detached houses. I agree with the noble Lord, Lord Inglewood, that they want them to live in palaces. I am aware that the beauty of holiness, Laudianism, has been from time to time controversial in the history of the church, but I am also aware that the church's commitment to art as an expression of spirituality has always returned. I hope and believe that modernism, plainness and aesthetic banality will prove to be passing fashions in the life of the church.

In this fourth centenary year of the King James Bible, when church leaders are asking us to rediscover the literary genius of the Anglican heritage, which has been an inspiration not only to our nation but to the world, how can they sell out their other heritage? It might be gratifying to the hair-shirt tendency and the puritans, but it would be a betrayal of centuries of spirituality and social leadership. How can the Church Commissioners be so philistine as to contemplate this? Are they proud of their record of selling Georgian rectories? After the bishops' palaces, will they sell the grade 1 listed churches, send them to follow the old London Bridge to Arizona, where I fear that there would be plenty of eager buyers?

11 pm

Church of England moralists have inveighed against asset strippers, junk bond dealers and greedy bankers, but if the Church Commissioners and leaders are to act like a bunch of simoniacs in the 21st century, selling their heritage as their predecessors in the middle ages sold ecclesiastical privileges, we might as well accept that the bankers should be in charge of our spiritual destinies. The church should put the money changers in their place.



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We are speaking not only of the plight of the palaces of the Bishops of Carlisle and Worcester. The Church Commissioners have very seriously considered selling Auckland Castle, the great residence of the Bishop of Durham. I understand from my noble friend Lord Foster of Bishop Auckland that they have now thought better of that part of their plan, but I also understand that they are still bent on selling the great series of paintings by Francisco de Zurbarán that hang in the dining room at Auckland Castle. I shall quote a letter that was reproduced in the 8 December edition of Town and Country, addressed to Andreas Whittam Smith, the First Church Estates Commissioner. It says:

"Sir, The recent decision of the Church Commissioners to sell the outstanding series of paintings by Francisco Zurbaran at Bishop Auckland Palace, Co Durham, is deeply to be regretted. Assuming that the Commissioners have the legal right to sell the pictures at all, their decision disregards the importance of the paintings in their present setting, as well as the local significance of the Bishop's palace itself (of which the paintings have formed an integral part since the mid 18th century). The decision appears to have been taken without an informed public discussion. Nor has there been appropriate wider consultation, either regionally or nationally. We urge the Church Commissioners to reconsider the proposed sale".

There were 55 very distinguished signatories to that letter, including the Dean of Durham, the noble Lord, Lord Inglewood, my noble friend Lord Foster of Bishop Auckland, Helen Goodman, the Member of Parliament for Bishop Auckland, John Whittingdale MP, the chair of the Culture, Media and Sport Select Committee in the House of Commons, Professor Maurice Howard, president of the Society of Antiquaries of London, and no fewer than 21 other fellows of the Society of Antiquaries. I declare an interest as an FSA myself.

These paintings depict Jacob and his son, the patriarchs of the 12 tribes of Israel, and were acquired by Bishop Richard Trevor in 1756. Bishop Trevor was the leader of a campaign to allow Jews to become British citizens and his acquisition of these paintings and their display was a symbolic statement of his support for what was known as the Jew Bill. That legislation was a historic advance in religious tolerance in this country. What would the church say today to those persecuted on account of their race and religion if the latter-day Church of England disowns that moral legacy and cashes in on the heritage of these paintings? We want the Church of England to be part of a bigger, more magnanimous society, surely.

The Northern Echo on 6 January reported the secretary to the Church Commissioners, Mr Andrew Brown, as confirming the decision to sell the Zurbaráns. He hoped that £15 million would be raised, which might yield £500,000 a year-the modern equivalent of 30 pieces of silver. Councillor Simon Henig, the leader of Durham County Council, was reported as saying that the Zurbarán paintings were,

In a poll conducted by the Northern Echo, when asked,

"Should the Zurburan paintings be sold?",



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22 per cent of those who responded were content that they should be and 78 per cent said that they should not. Much more recently, last Saturday in the Telegraph, there was a story headed:

"Historic Zurburan paintings could stay at Auckland Castle after church reviews sale plan".

It went on:

"The Church of England is to review plans to sell a collection of historic paintings for £15 million after an outcry from local worshippers".

It reported Mr Tony Baldry, who is the Second Church Estates Commissioner and, as we all know, a civilised man, as saying, in answer to a Parliamentary Question:

"The Church Commissioners, by and large, do not possess pictures-we tend to own land and property-but I am in absolutely no doubt of the importance and identity of those pictures, which is why the working party that I mentioned, which will be chaired by the lord lieutenant of Durham, will consider ways in which the Zurbaráns can stay at Auckland castle".-[Official Report, Commons, 30/11/10; col. 666.]

However, he went on to give rather uninformative answers to Questions tabled by Helen Goodman. The report continued:

"Later, a spokesman for the Church Commissioners said preparations for the sale would continue while the review group considered other options. 'We will continue with the proposed sale, on the timescale of a sale by auction next summer, while the working group continues to meet and come up with ideas. We will engage with any proposals they make, and consider them, but meanwhile the preparations for the sale of the paintings continue'".

Lord Lester of Herne Hill: I hope that the noble Lord will not think that what I am about to say is in any way discourteous, but he plainly has a bee in his bonnet. He has spoken about it now for over 10 minutes and we have got the point. I wonder whether it is really necessary to read out quotations, as he has been doing, when we understand his point that the Church Commissioners should be within the Bill.

Lord Howarth of Newport: I feel deeply advised by the noble Lord, Lord Lester. I was at the point of concluding and I appreciate that I have detained the Committee longer than I should at this stage of the evening, but a number of noble Lords feel that we are talking about important issues. There are other, better ways for the church to raise £500,000 a year. That the Church Commissioners are contemplating doing it in this way is disgraceful. To protect the wider national interest from these depredations, I support the amendment.

The Lord Bishop of Leicester: My Lords, I must present to the Committee the apologies of the right reverend prelate the Bishop of London, who is the chair of the commissioners. He cannot be in the Committee this evening because of his ecclesiastical responsibilities. I declare an interest as a diocesan bishop of the Church of England in receipt of a stipend from the Church Commissioners and in expectation, or at least hope, of the receipt of a pension in due course.

I fear that I will deeply disappoint the noble Lord, Lord Howarth, by explaining that I live neither in a palace nor a castle, nor have I any desire to live in them. I live in a house in a street in Leicester where I

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can offer hospitality and from which I can discharge my ecclesiastical responsibilities with a whole range of connections and networks, which seem to be widely appreciated in the city, the county and the region. Leaders of civil society there have never given me or my predecessors any reason to suppose that by not living in a more exalted dwelling I am somehow deficient in discharging my responsibilities.

I offer the Committee four reasons for urging that this amendment be resisted: first, the established acceptance that Parliament does not take the initiative in legislating on church affairs; secondly, the existence of already robust governance arrangements; thirdly, the Church Commissioners' clear charitable obligations; and, fourthly, their record of public consultation in detail and consistently on contentious transactions, contrary to what has been alleged in the Committee this evening.

Since 1919, Parliament has rightly left matters concerning the church's internal governance entirely to the church. Parliament has the power to find ecclesiastical legislation inexpedient and apply pressure to the church in various ways, but direct ministerial oversight seems neither necessary nor proper. This is not to argue that the commissioners should be free from scrutiny, but the amendment seeks to increase the level of governance upon the commissioners at the very time that they have become subject to regulation by the Charity Commission, given that they lost exempt status on 1 June 2010.

In no sense is there an accountability deficit here. The commissioners were not unaccountable before the Charity Commission registration. Their report and accounts are laid before Parliament and the General Synod. As has been pointed out, the Second Church Estates Commissioner is answerable in the other place and regularly gives an account of the commissioners' proceedings. I need hardly remind your Lordships that the occupants of this Bench are Members of your Lordships' House. There are six state commissioners: the Prime Minister, the Lord President of the Council, the Secretaries of State for the Home Department and for Culture, Media and Sport and the Speakers of both Houses of Parliament, to whom whistleblowers have recourse.

The amendment, as we have heard, is motivated primarily by concerns about the commissioners' responsibility for the national heritage. Your Lordships may be interested to know, in passing, that the Church of England, quite apart from its many other activities and the support of its clergy costs, raises between £400 million and £500 million a year from voluntary donations to support the built heritage of England, 60 per cent of which is the responsibility of the church. Let us not suppose that the church is somehow engaged in money-grabbing activities to save small pockets of money here and there; much larger sums are raised thorough the encouragement of the dioceses, of the bishops and of the churches in every locality to support our church buildings.

The Church Commissioners are not themselves a heritage body. They have fiduciary responsibility for the management of the assets with which they have been entrusted. Parliament gave them the responsibility

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to provide the maximum sustainable support, within their strong ethical investment framework, for their beneficiaries. They must not support today's church at the expense of tomorrow's church, and this means being strong enough to resist pressure, which the current governance structures enable.

Of course the commissioners must also act responsibly and transparently, which leads to the second point in this thread-that the commissioners are already actively involved with a wide range of local communities, seeking ways of satisfying their trustee duties while giving weight to local and national views about heritage and other issues. Your Lordships may be interested to know that, when an incumbent diocesan bishop becomes 62 and retirement age is in view, a full consultation takes place in the diocese about the suitability of the see house, possible alternatives and developments. There is consultation across a wide cross-section of civil society in every diocese.

For example, the commissioners have had discussions with local stakeholders about the future of Rose Castle-I shall say more about that in a moment-and they have given a local trust the opportunity to raise funds to purchase Hartlebury Castle. They are also currently engaging with a group chaired by the Lord Lieutenant of Durham that is exploring the retention of the Zurbaráns at Auckland Castle.

Let me say a little more about that. It is important for noble Lords not to believe everything that they read in the press on this matter. The sale of the paintings could raise at least £15 million for the church's work across the country, especially in areas of the greatest need. The return on £15 million when invested, plus saved insurance and security costs, is equivalent to the cost of about 10 priests in perpetuity, in addition to the support we already provide. I remind your Lordships that the church is constantly being encouraged to play its part in the big society; to exercise its role in every local community; to ensure there is local leadership, which must be trained, housed, stipended and engaged with local people; to provide chaplains to schools, hospitals, prisons, universities and other organisations; and to play its part in engagement with other faith communities. All of this requires proper funding.

11.15 pm

The Church Commissioners have a legal obligation to maximise support for the church's ministry. Government ministers should not, I contend, be in a position to overrule them in relation to such activities, although it is perfectly proper that the commissioners should be and are accountable for them. As I have said, the commissioners have engaged with the Lord Lieutenant of Durham, local councillors, the local Member of Parliament and numerous other interested parties. They have answered questions in the House of Commons and in the General Synod on the matter repeatedly. Meanwhile, preparations for sale continue and we hope that these paintings might be sold next summer. While the commissioners are engaging with the working party that seeks to retain the pictures at Auckland Castle, they will not put conditions on the sale so that, ultimately, the purchaser will be in a position to decide what to do with them.



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As for Rose Castle, the commissioners have a duty to ensure that bishops are appropriately housed. Rose Castle is unsuitable as a home for a modern bishop. It is too large and it would be too expensive to put right. The diocese of Carlisle supports this view and favours a see house in Keswick-in the centre of the diocese. Again, the commissioners have been engaging locally for some time to find the best way forward, and continue to do so.

Given its maintenance of so many special buildings, the church is the nation's leading heritage organisation. However, the commissioners are not primarily a heritage body; they are trustees of the church's historic assets and they are required to optimise their benefit for the church of today and tomorrow. The commissioners are a registered charity with a clear, specific legal responsibility to support the ministry of the Church of England and they have clear, robust governance structures. There could, if we are not careful, be a collision of governance if this amendment is passed. At this hour we should resist the temptation for Parliament to take back powers that it has given to the church, and concentrate instead on using more effectively the perfectly proper and long-standing means of holding the Church Commissioners to account.

Lord Foster of Bishop Auckland: My Lords, I support the amendment and I am very grateful to the noble Lord, Lord Inglewood, for the time that he has given to researching the legalities. I am not qualified either to support or to challenge these but I am most grateful to him. I am grateful, too, that he mentioned the Zurbaráns. My noble colleague pronounces it differently -I think a member of the Royal Family would agree with him-but, none the less, I call them Zurbaráns.

I have a great regard for the Church Commissioners. I would not agree with all the remarks made by my noble friend. I have had the great pleasure of serving with four Bishops of Durham, all of whom lived in Auckland Castle, which was part of my constituency for 26 years. It was a great joy to work with each of them. Indeed, I was a trustee of Auckland Castle for more than a decade and gave a great deal of my time to trying to reduce its financial burden on the Church Commissioners. We had considerable success during that period, before the trust was disbanded only last year.

The reason I support the amendment is that we are not arguing against the fiduciary responsibilities of the Church Commissioners, but we believe that they should also have a responsibility to pay due regard to national, local and regional heritage. After all, King John stayed at Auckland Castle in 1203, so I gather. The bishops of Durham were always prince bishops. Indeed, the county of Durham described itself as the land of the prince bishops. They were very powerful people indeed in those days and colossal figures in the whole political, social and economic life within the county of Durham and the wider authority.

I have been discussing this matter with the Church Commissioners for 15 years. On three occasions they have sought to sell the castle and the paintings, and on three occasions we have managed to dissuade them from doing so. On the last occasion, the campaign was ably led by bishop Tom Wright with the support of the

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Bishop of London, to whom the right reverend Prelate referred, and ultimately with the support of the Church Commissioners. I am very grateful to him for what he said and for the spirit in which he said it.

The commissioners have not always taken the same view. There was a period 15 years ago when they wanted to sell off all the bishops' palaces as quickly as they could, but I think that reflected the position of a single commissioner. They departed from that view and have taken a much more sensible view over about the past decade. Now they are in discussion with Durham County Council and the group chaired by the Lord Lieutenant of Durham, of which I am a member. We are very pleased to be discussing this matter with the Church Commissioners.

However, it would be enormously helpful if the Church Commissioners had a duty to pay due regard to national and local heritage. After all, the Zurbaráns have been there for 250 years. They were bought for £150 by the bishop to celebrate the changing of the law in this place to extend the civil and political liberties of the Jews. What a wonderful thing he did 250 years ago. In the north of England we celebrate the great fact that we had such a progressive bishop, and we have had several since then. The bishop wanted to celebrate this deeply unpopular step among society at large by buying the Zurbarán paintings and extending the long dining room of the castle in order to hang them there. They have hung there ever since. We are enormously proud locally of the castle and of the Zurbaráns. The commissioners need to take all that into consideration.

I am still hopeful that we can come to a sensible conclusion on this issue. I am very grateful to the noble Lord for giving me the opportunity to speak in support of the amendment.

Lord Deben: My Lords, I shall not keep your Lordships' House long but I want to make a further point. The Church of England is in a very real sense the guardian of the nation's ecclesiastical treasures. It received them in circumstances which would be inconceivable today. We all have an interest in this. For many years I sat on the Ecclesiastical Committee as an Anglican and then as a Catholic. That change was perfectly reasonable because the Ecclesiastical Committee of the two Houses is there to ensure that decisions made perfectly properly by the Church of England do not detract from the interests of Her Majesty's subjects as a whole.

The problem with the argument put forward by the right reverend Prelate is that it seeks to suggest that the Church of England is not the Church of England but a sect that is able to use its resources for its particular interests at a particular time. I warn the right reverend Prelate that his argument is very dangerous because his presence in this House is earnest of the fact that the Church of England is not thought by our society to be merely a sect. I have to admit that I left the Church of England because I believed that by making choices of a theological kind, it had changed-

The Lord Bishop of Leicester: Will the noble Lord agree with me that the argument I have been adducing is that the Church Commissioners have a responsibility

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to use the assets the church has acquired historically in whatever way they judge to be in the best interests of its service to the whole nation. That is precisely the basis of the argument for certain disposals; those wider interests should be borne in mind in the management of the church's assets.

Lord Deben: The right reverend Prelate is making a judgment that I am suggesting is in fact, on this occasion-probably only on this occasion-erroneous. The fact is that the Church Commissioners are making a choice about how the historic property of the Church of England should be used in today's world without, frankly, any thought of either tomorrow or yesterday. The Church of England has a duty to remember the interests of the whole church. This money will be applied to a number of charitable purposes, but the disposal will deprive our society of some very valuable things.

I hope that the right reverend Prelate will allow me to use a biblical comparison. Many people criticised Mary Magdalene for using valuable ointment on the feet of our Lord. He said very clearly that they were wrong in their judgment. My problem with right reverend Prelate's argument is that I have heard it before. When I was a member of the General Synod of the Church of England, I argued that the assets of the church that protected the pensions of the right reverend Prelate and others should, in fact, be applied only to socially responsible investments. The secretary of the Church Commissioners got up and said, "We apply them using the very best advice of the City of London". I said, "I thought the church was supposed to lead and set the example, not blame the City of London or suggest that the City can make moral judgments". My noble and right reverend friend Lord Harries took the Church Commissioners to court on this issue and I am sad that he did not win. However, the Church Commissioners have changed their views on this.

This is the second reason why the right reverend Prelate is wrong, because if the Church Commissioners can invest, not for the best return on their money but on the basis that they will invest only in things that are proper for the Church of England to invest in, the church is making a judgment, not about what it can make the most money out of, but one which comes from its Gospel doctrines. I have to say that the idea that you could sell and allow to be taken-because that is what will happen if the position cannot be changed-from the walls of that great house a memorial to a moment in history when the Church of England stood up for the Gospel doctrines in a way which was remarkable for that century would be a manifest betrayal of the Church of England's duty to look after the interests of the whole nation, rather than to seek to make an immediate profit for the use of a particular attitude and a particular church. That is not the role of the Church of England. This money is going to be spent not to protect interests in which all of us can join but to protect those of a no doubt very noble but particular position of the Church of England.

11.30 pm

The third reason I feel so strongly is that we have had this before in another way. The Ecclesiastical Committee found that the behaviour of the then Dean

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of Westminster Abbey was other than satisfactory, but there was no ability to question the Dean because it was a royal peculiar, and the Church of England protected that situation. Although the interests of the wider community might have suggested that the committee should have been given that opportunity, which is the case with every other cathedral, it was not something that the Church of England was prepared to do.

I say to the Committee that I have come to the very sad conclusion that, when property or money is concerned, the Church of England does not always reach to the highest standards. I have found that all my life; I am finding it at the moment in the delicate issue of the ordinariate and the ability to share churches; and I find it in the fact that the unnecessary building of churches takes place in my own area, because the Church of England is not prepared to have long leases and to share with others. It is very curious that it is the one area where one finds it very difficult to get the Church of England to behave as one would expect.

The Lord Bishop of Leicester: My Lords-

Lord Deben: I shall give way to the right reverend Prelate but I shall just finish this one point. The Church of England has to learn that, if it is to continue to have a place in our society, it has to show a generosity of spirit which it has not shown in this debate. It has not yet understood that it is the guardian of something that it did not buy. A bishop bought these pictures, and a church with which it is no longer connected built those great palaces. The Church of England has a duty to respect the past. It has a duty to pass it on to the future and not to say to today's generation, "I'm very sorry, it's nothing to do with us. We can sell this, use the money and it will go". It cannot do that and still claim the privileges for which I have fought, and will continue to fight, even though I am not an Anglican. However, every time it does not understand what my noble friend Lord Inglewood was saying, it undermines the establishment of the Church of England.

The Lord Bishop of Leicester: I wonder whether the noble Lord can help me with the criticism that he seems to be levelling at the Church of England as being irresponsible in its custodianship of the heritage that it holds. I find that a quite extraordinary charge and it is one that I do not think has been substantiated by anything that the noble Lord has said.

In my diocese, I am the custodian of 300 medieval churches. It is an extraordinary heritage experienced by every diocesan bishop right across the land. Tonight, we are discussing whether the Church Commissioners should have responsibility for deciding how best to house the diocesan bishops of today and tomorrow. A number of references have been made to our history, some of them to the 12th and 13th centuries. I am sure it will not have escaped the notice of your Lordships that circumstances today are very different from those of the 12th and 13th centuries. You simply cannot manage a built estate today on precisely the same principles as applied then. There are different considerations and many pressures on the Church of England and the Church Commissioners. Some of those pressures include

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many people arguing that in an age of austerity it is inappropriate for bishops to be housed in castles and palaces. That is also a consideration that needs to be weighed. It is not reasonable to say that the Church of England is somehow, in a cavalier manner, disregarding its past and future responsibilities. I made precisely that point in my remarks. It has to weigh all of those and walk a tightrope between its responsibilities to its heritage, to the wider community, to the nation and to the gospel.

The noble Lord quoted the story of Mary Magdalene pouring precious ointment over the feet of our Lord. That is an important example, but the question for this House to resolve tonight is who is best placed to interpret that tradition, the Church Commissioners and the Church of England, established under Parliament by law, or the Secretary of State? I suggest that the present arrangements protect that interpretation more satisfactorily than whoever happens to be the Minister in charge from time to time.

Lord Deben: I promise not to hold your Lordships' House any longer, so I shall reply specifically to that. If I felt that the Church of England had carried through its necessary duties in a way that was commensurate with its great heritage, I would not be supporting the amendment. If the argument of the right reverend Prelate were made by anyone else, no one would take it seriously. If anyone said, "I am very sorry. I am now running a business and it is really very difficult for me to keep this house as it is", people would say, "I'm afraid that is your responsibility; that is what happens if you have been given the house; you have to look after it properly". It is all right arguing about the churches, but you cannot make any money out of the churches.

Lord Lester of Herne Hill: I am a Jewish atheist and, therefore, have no special interest, but I regard what the right reverend Prelate the Bishop of Leicester has said as totally cogent and convincing. I believe that the question he has asked has not been addressed by the noble Lord or by the noble Lord, Lord Howarth: who is to decide, the church under the separation of church and state, or a Minister? Unhesitatingly, I agree with every word that the right reverend Prelate has said. When I listen to noble Lords talking about palaces, I am reminded of the absurd and pompous discussions we had about judges' lodgings and the notion that High Court judges could not be judges unless they were insulated from the public and lived in those amazing country houses. This is exactly the same argument; it is reactionary and I do not believe that the law of charity or the other mechanisms do not adequately protect the public interest.

Lord Deben: I say to my noble friend that I have never claimed that bishops should live in these palaces. I do not want them to live in these palaces. The noble Lord, Lord Howarth, thinks that, but that is not my argument. My argument is that the Church of England has a specific role in our society which involves accepting that it has a duty of care of that which it largely has received and did not itself create; someone else created

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it and it was handed on. The fact is that the Church of England has failed. Of course, it does not sell the churches; no one wants to buy medieval churches; it sells the things it can make money out of. Therefore, I unhesitatingly say that it will be very much better for the Church of England if a Minister were able to remind it of its duty, not just to the moment, not just to the future, but to the past, and its role, dependent on the fact that it is the Church of England; and if it forgets that, many of us will have to change our minds about its place here and in the establishment.

Viscount Eccles: My Lords, I do not want to detain the House for a long time and I shall not. My noble friend Lord Deben has gone too far, as he did when he did not renew me as chairman of the Royal Botanic Gardens Kew. He came to a very bad judgment about that and I entirely support the right reverend Prelate the Bishop of Leicester in his thesis.

I make one practical point about the Zurbaráns in Auckland Castle. The Church Commissioners are responsible for £5 billion worth of financial and property assets. The income from that funds 16 per cent of the church's expenditure. The other 84 per cent comes, largely, from the congregations of the church and from, as the right reverend Prelate said, appeals for repairs and appeals for lead for the roof which needs renewing and so on. I think that the Church Commissioners and the church should take account of two things as they consider the position of the Zurbaráns. They need the support of their congregations. I do not think that it is certain that they will get £15 million for the Zurbaráns. The last time that this came up, as the noble Lord,Lord Foster of Bishop Auckland, will remember, the Bowes Museum got an estimate from the market-not from Christie's or Sotheby's-and quoted £6 million, not £15 million or £20 million, which I think was the Sotheby's quote. So there is an issue about the risk which the Church Commissioners are taking with these pictures, which has nothing to do with the romantic story of Bishop Trevor, and that one of the pictures is a copy by Mr Pond for 24 guineas and the other pictures cost 21 guineas each. That is a very romantic story that has all the connotations of the disabilities of the Jews and all those things.

However, if the congregation in the north-east supported a solution which meant that the Church Commissioners could add on, shall I say, £12 million to £5 billion, you could say that that is likely to be a good judgment, not a bad one. With respect to the noble Lord, Lord Howarth, I do not think that the church has to hang on to every asset. One could suggest that it sells the divorce papers of Henry VIII from Catherine of Aragon, which sit in the library in Lambeth Palace. I do not know how much they would make, but I would guess quite a lot of money.

We should not get tremendously excited about this. It is a practical issue, as the right reverend Prelate the Bishop of Leicester has presented it to us. It is full of practical judgments, but the church needs the support of its congregations. I say rather quietly that in the north-east, there is the Dean of Durham-I remind the House that there is no Bishop of Durham at the moment. Durham Cathedral has an appeal out now.

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Are the Church Commissioners absolutely certain that they will not lose by raising £12 million and having an income of £360,000 a year-the Church Commissioners' assets yield 3 per cent-because congregations will say, "If you can do this and that, we are not going to give you so much money every Sunday or when you make an appeal"?

The Lord Bishop of Chester: I know that the hour is late and I shall make only a few brief comments to put certain things on the record-not repeating, I hope, what has been said. I declare an interest as a member of the board of governors of the Church Commissioners -four bishops are elected to the board.

The first is to say that the Church Commissioners is a charity. I ask the Minister whether any of the other bodies listed in Schedule 3 is a registered charity. That is an important question to ask if we are thinking of adding the Church Commissioners to the list. The Church of England itself is not a public authority. That was clarified by the Judicial Committee of your Lordships' House a few years ago in the Aston Cantlow case. It is a public authority for only certain limited purposes. We have been speaking in a carefree way, as if the Church of England is simply a public authority. It is not. For certain purposes it is, and there is a rather delicate ecology that lies behind everything here. There is no such legal entity as the Church of England. The Church of England is a symbiotic, organic collection of different bodies, each with certain degrees of independence. The noble Lord, Lord Inglewood, was wrong when he said that in no legal sense are the Church Commissioners part of the Church of England. They are part of that symbiotic connection, and you can disturb that and lots of other things without intending to do so.

The cost of maintaining the historic houses has progressively risen and taken a progressively greater proportion of the income of the Church Commissioners for several decades. That poses the question: how do you responsibly allocate the income for different purposes when you find that the cost of maintaining historic houses, which we know is great, is a constant upward pressure? Those are the decisions that the Church Commissioners are best placed to handle.

11.45 pm

The noble Lord, Lord Howarth of Newport, raised the interesting issue of suitability. I live in an old deanery, which is quite big. I reckon that 30 years ago the bishop had four members of staff to support him and his family living in that house. When I arrived in Chester nearly 15 years ago, there were two members of staff. Now there is one. Living in an historic house creates a lot of pressure. It is not quite such an attractive option when you are faced with the reality of handling a house without staff because they cannot be afforded. That is something that has not been mentioned.

The noble Lord, Lord Inglewood, spoke of the Church Commissioners looking on see houses as cash cows. Placing a see house is usually a cash-neutral exercise, if anything, and it often costs more because there are not lots of people lining up to buy the sort of houses that we are disposing of. The noble Lord also

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referred to the Church Commissioners as engaged, and I quote him, in money laundering. I wonder whether he might withdraw that remark when he makes his closing remarks. It seems an inappropriate term to use in your Lordships' House and I hope we will not slip into that sort of allegation. The noble Lord, Lord Deben, made all sorts of allegations, but I noticed that they were of a general kind on the whole.

There is no rush. In the case of Hartlebury Castle, there are five years-2007 to 2012-to see whether a local solution can be found. In the case of Auckland Castle, there is and has been no proposal to sell it. There is a discussion about the castle and its contents that will, no doubt, go on. I am very pleased to hear of the discussions taking place. There is no rush, I promise you. There is only a desire to do what is best in this rather delicate ecology of how the Church of England relates to the nation as a whole.

Baroness Royall of Blaisdon: My Lords, I rise for two minutes. I was going to say that this was going to be an interesting discussion, but actually I found it a deeply shocking discussion. I am shocked by some of the allegations that have been made this evening. I think that the church has got a very difficult tightrope to walk at this very difficult economic time. Of course it has to care for our heritage, and I am sure that it does care for it deeply, as the right reverend Prelates have said, but its first responsibility at any time should be towards the flock and the people for whom it cares. In doing that, of course, it must also take into account the heritage that we all cherish. I am going to sit down now, but I think that this debate has been perhaps more inflamed than it should be. It perhaps demonstrates the need for greater scrutiny of the Church Commissioners, and I think that perhaps that is something that the Government and the church itself could look at because clearly there is a demand for perhaps more conversations and discussions about things that are going on. However, I am pretty much appalled by some of the things that have been said this evening.

Lord Taylor of Holbeach: My Lords, I have enjoyed listening to the debate, but I share some of the noble Baroness's observations on it. Perhaps it is the lateness of the hour. There is scarcely enough time to consider a topic as significant as this. I think I would have enjoyed the debate more if it had not been in the Public Bodies Bill, but it is clearly not an appropriate topic for this Bill, so I am going to address my remarks purely on those grounds. I think the House may well discuss methods whereby the scrutiny of church affairs could be brought back to this House in some way, but that is a matter for the House authorities. It is certainly not a matter for the Public Bodies Bill.

There are three reasons why the Government cannot accept this amendment, and they have been said. The first is that the Church Commissioners fall outside the scope of the Bill. They are not a non-departmental public body but essentially a non-governmental body and a charity under the scrutiny of the Charity Commissioners.

The second reason is the historic relationship between Parliament, government and the Church of England-perhaps we have seen why this separation of the estates

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is so important in the nature of the debate that we have had this evening. Since the enabling Act 1919 set up the Church Assembly, now the General Synod, it has been accepted that Parliament does not in practice legislate on the internal affairs of the Church of England without its consent. The mechanism laid down in that Act for legislating on the Church of England included the constitution of the Church Commissioners through synodical measure. There are, of course, methods by which Parliament can put pressure on the church to act, but the noble Lord's amendment seeks to return to a position in which Ministers would have a direct power to intervene in the governance of the commissioners.

The third reason is that the commissioners' board of governors, of which the right reverend Prelate is chairman, as trustees of a charity, are under a fiduciary duty to manage their assets in the way that best enables them to achieve their charitable purposes. It is therefore for them to determine how best to do so, including by deciding whether to dispose of particular assets. It is not a matter for Ministers to regulate in the case of this or any other charity. I therefore urge the noble Lord to withdraw his amendment.

Lord Inglewood: My Lords, I thank all noble Lords who have taken part in this debate. I must say that when I moved the amendment I had no idea what direction the debate would take, but I did not anticipate that it would move in the way in which it did. I particularly thank the right reverend Prelate the Bishop of Leicester for arguing the case that he did in the way in which he did, and I thank my noble friend Lord Deben for his counter point. In a way, it drew a lot of the argument into the open and made it clear that these issues are perhaps not as clear as we all like to think they are at first blush. The right reverend Prelate the Bishop of Chester asked me whether I would withdraw the use of the words "money laundering". I shall do so, although what I actually said was "a form of money laundering", and I bracket those words with "the philosopher's stone that turns base metal into gold".

I will make one technical point and then one more general point. The technical point is that the Church Commissioners are not completely charitable. The point of the 1943 measure is that they hold certain funds that include the bishops' palaces, which are not held charitably-and I base that not on my own inadequate legal knowledge but on Halsbury's Laws of England in the Library of the House. The relationship between the Charity Commissioners, the Church of England and its assets is perhaps not as straightforward as any of us quite think.

I will also make a point that no one else has made this evening but which I feel has something to do with this. In religious matters, enthusiasms gain prominence from time to time-we have seen this in a number of areas, such as the Reformation and the iconoclasm of Byzantium-in which so enthusiastic do people become about a particular way of looking at things that they perhaps feel that they can ignore everything else in the pursuit of it. My sense as an individual, as one of the foot-soldiers in the Church of England, is that there is

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currently a great movement against the kind of things that I was talking about. I hasten to add that I hope your Lordships noticed that I never said that bishops should live in bishops' palaces; I said that if bishops ceased to live in bishops' palaces, proper and legitimate steps should be taken to look after the heritage interest that they represent. I added in parenthesis that I had a personal preference in that direction, but that is quite different. I am concerned that, if we have a kind of cultural revolution, as we have seen from time to time in churches, the Red Guards should not destroy all the things that matter in effecting the changes that they want to see.

It is ultimately for the Church of England to decide what it wants to do but I believe that we all have a legitimate interest in the assets of the Church of England and that society as a whole has a legitimate interest in what happens to them. After all, these particular buildings are listed and the civil authority is not simply decoupled from them.

It is late. We have had a lot to think about, and I hope that we shall continue to think about it. I beg leave to withdraw the amendment.

Amendment 70A withdrawn.

Amendment 71

Moved by Baroness Thornton

71: Schedule 3, page 18, line 22, leave out "Commission for Equality and Human Rights."

Baroness Thornton: My Lords, in speaking to Amendment 71, I shall speak also to Amendments 88 and 138 and give my support to Amendment 78. The noble Lord, Lord Lester, and I are under the cosh tonight, so I will try to be as brief as I can. As regards this Bill, many noble Lords have been concerned that the proposed process and mechanisms to modify or abolish public bodies might have been unconstitutional and disproportionate, and in this case may jeopardise the crucial independence of the EHRC and other public bodies working on equality and human rights issues.

When I think of all the bodies listed in this Bill, the fact that the organisation established to safeguard equality and human rights, the independence of which is vital, should be subject to a procedure which may threaten that independence to act on behalf of those discriminated against, including against the state, has to raise questions. We suggest that consideration should be given to removing the EHRC from this Bill and making changes to its functions, powers and constitution through the normal parliamentary procedures of primary legislation.

I am very pleased to note that the Minister has been working with the noble Lord, Lord Lester, and the noble and learned Lord, Lord Mackay, on the safeguards that should apply to orders made under the Bill, particularly in relation to Amendment 175. I thank the noble Lord, Lord Taylor, for meeting me and I

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hope that the Government will reach a conclusion that offers protection for the necessary independent exercise of these public functions.

I am also aware that the Government have said that they will shortly consult on options for reforming the EHRC. However, the consultation paper has not been published. The Government's stated intention is to refocus the commission's work on its core functions of regulating equality and anti-discrimination law in Great Britain, of fulfilling EU equality requirements and of being a national human rights institution.

I understand that Ministers are also considering transferring some of the commission's functions and services to government departments or contracting with private or voluntary sector bodies to undertake them. The Government have indicated that this may include the commission's helpline and grants function. I would point out that ahead of this constitution and before details are known, the Public Bodies Bill will give Ministers significant powers to modify the functions, powers and constitutional structure of the EHRC.

It has a distinctive constitutional role in Britain's democratic system in holding the Government to account, which was highlighted by the Joint Committee on Human Rights prior to the EHRC's establishment. The JCHR said that the EHRC had a similar role constitutionally to the Electoral Commission, the National Audit Office and the parliamentary commissioner for administration, and therefore should be accountable directly to Parliament. Similarly, it is entirely appropriate that Parliament would have a full role in debating any proposed amendments to the EHRC's powers and functions. Indeed, when we were taking the Equality Act 2006 through Parliament there was a significant amount of debate about the independence of the new body being created. I think that the noble Lord, Lord Lester, paid a pivotal role in persuading my Government to ensure that the EHRC had a great deal of protection of its independence-and quite right too.

The EHRC requires independence from government in relation to its functions, its structures and the exercise of its powers as a requirement of the United Nations Paris Principles of national human rights institutions. If Ministers were able to modify the powers, functions and constitution of the commission by ministerial order, what questions would that raise about independence and how would it affect our ability to maintain a status as a national human rights institution?

Finally, I turn to what is in many ways the most important question and one that I discussed with the Minister earlier today. The question is whether the Bill would allow any future Governments to modify and abolish the HRC by ministerial order and take legal action against that. This is an issue on which we need clarification, part of which has already been given by the Minister in the earlier exchange. Perhaps I may put it in simple language. If this Government proceed as outlined in the Bill and, after consultation, use the statutory instruments at their disposal to reform the HRC and use the powers in Parts 3, 4 and 5 to change it, could another Minister with even more enthusiasm than the noble Baroness, Lady Verma, and her colleague, Lynne Featherstone, come along in three years' time

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and start the whole process over again? Does the Bill give them the powers to do that? It seems to me that that is a very serious matter indeed. I beg to move.

Midnight

Lord Lester of Herne Hill: My Lords, I, too, have put my name to this amendment and the others in the group. As the noble Baroness, Lady Thornton, has already mentioned, I did play a part when we were enacting the Equality Act 2006, the legislation which provided safeguards for the Equality and Human Rights Commission when it was being set up. The particular safeguards that we negotiated when the noble Baroness, Lady Ashton of Upholland, was the Minister were, first, that the Secretary of State should pay to the commission,

The second one provided that the Secretary of State,

The third concerned the merit appointment of the commissioners. Those safeguards were put in because originally the Bill would have allowed Ministers to be very interventionist in relation to the commission. The then Government showed what I think was open-minded wisdom in realising that these safeguards were needed. So naturally I was concerned when I saw that the commission was in three schedules and, indeed, in Schedule 7, too.

I pay tribute to the patience of Ministers, but especially of their civil servants who have to be even more patient, in discussing the kind of safeguards that are needed not only in relation to this commission but also to any other bodies that are subject to the powers contained in the Bill. We are now very close to agreeing on general safeguards, without which I would have very great concerns, particularly in relation to the commission. But I am not quite in a position to tell the Committee what I think might be the safeguards that would be an improvement on Amendment 175, which is the amendment that the Committee has in effect already approved. It is important that these safeguards are put in place during the Committee stage in order that we know where we are when we get to the Report stage.

The particular safeguards that I think are very important for this commission are, first, safeguards of its independence when it is performing a judicial function, as it does, of course, when for example it is deciding whether to find someone liable for unlawful discrimination. It has to act independently and impartially in doing that. Secondly, the commission has oversight or scrutiny functions and can bring legal proceedings. Often those proceedings are brought against government departments, so it is important that Ministers should not be in a position to try to nobble the commission or persuade it not to perform its strategic law enforcement functions. Thirdly, it is important that there should not be overkill; that sledgehammers should not be used to crack a nut.



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If those safeguards were in place, the Equality and Human Rights Commission would be quite wrong in suggesting, as it has in its latest briefing, that it should be outside the Bill altogether. Provided those safeguards are in place, the commission should not be immune from the kind of changes which it would be sensible to make and which are indicated in the briefing that the Government have published. Unfortunately, we do not yet have the consultation paper, but we have the benefit of a briefing note from the Government which indicates that they consider that there is a clear need for an independent equality regulator and a national human rights institution, and that the original aims of the commission are very much in line with the coalition Government's new approach on equality as set out in the equality strategy, Building a Fairer Britain-I say amen to that.

The Government have also made it clear that difficulties in the transition process from the old commission and the breadth of the new commission's duties have contributed to the underperformance of the commission to date, referring among other things to the report by the Joint Committee on Human Rights, to which I was party, as well as to the Comptroller and Auditor-General and the Public Accounts Committee. That is a good reason why the Government, although they have decided to retain the commission-I am delighted by that-wish to reform it. They have also said that they want the commission to become a valued and respected national institution focusing on its core role as a strong, modern equality regulator and UN-accredited national human rights institution but being able to show that it is using public money wisely. I do not want to wash linen in public, whether clean or otherwise, but there is no doubt that there have been arguments between the commission and the Government when the Government have sought to ensure proper financial regulation and accountability and so on and the commission has asserted its independence. I suppose that I can claim to be one of the great-grandfathers of the commission since I was there even in the 1970s when we first set up the EOC and the CRE. I think that there is a difference between self-government, which provides the independence which is needed, and irresponsibility when it comes to financial control. Therefore, provided the safeguards are in place, I think that the commission has to be accountable-I am sure that it would not disagree with this-when it comes to value for money.

What I suggest this evening-or rather this morning, since we have now just passed midnight-is that we should not proceed further with this subject other than to listen to the Minister, because we need to get the safeguards in place as soon as we can. Those safeguards are generic; they are to apply not only to the commission. Once they are in place, I believe that the Government's aims will be legitimate and that we can proceed further.

Lord Boswell of Aynho: My Lords, it is indeed a very late hour, and I rise only briefly to thank the noble Baroness, Lady Thornton, for raising this issue in quite moderate terms. I also thank my noble friend Lord Lester for the way in which he has nuanced it in relation both to the judicial or quasi-judicial activities and responsibilities of the Equality and Human

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Rights Commission and to the need for what might be termed a proper look at administrative reform, subject to the necessary safeguards.

I have had a developing interest in this matter over a number of years. At one stage in another place, I held a Front Bench brief on behalf of my party for disability issues at the time when the first discussions were taking place about a coalescence of the various bodies. I also had, for separate and unrelated reasons, an interest in both gender and racial equality issues. I supported, and I am very glad that we have effected, the merger of these various bodies. However, just as in relation to the previous amendment we discussed I bear no malice towards the Church of England in suggesting its inclusion in the Bill, I bear no malice towards the Equality and Human Rights Commission in suggesting that its position should be maintained within this schedule.

We need to concentrate on its main responsibilities while preserving its independence. Having had, because of those Front Bench responsibilities, dealings with Trevor Phillips, for example, at the time these bodies came together, and a number of constructive discussions about this, I do not think things have quite gelled as they might have done. There is more work to be done in taking the inefficiencies out of the system and in concentrating on core business. However, I would not like that to be interpreted by the Minister or anyone else as code for saying that there is no role for the EHRC. In the previous Equality Bill, when I had become before my retirement from the other place a Back-Bencher, I had immense support from the EHRC on some of the issues-for example, in introducing a long and complex amendment about a principles clause, which did not commend itself to the previous Administration, and also, indeed, in suggesting that there might be a human rights responsibility alongside the public sector equality duty.

As my noble friend Lord Lester said, there are some very important points about turning the ability of the commission to operate independently where there are defects, or arguments about defects, in the public sector. That integrity has to be maintained. The basic job which the commission was set up to do is worthwhile. We need to make sure that we clear out of the way any of the clutter and that that duty is clearly and effectively discharged.

Baroness Royall of Blaisdon: My Lords, most things have already been said but perhaps I may say that, for the moment, I support the amendment moved by my noble friend Lady Thornton. I say "for the moment" because, like many other noble Lords, my principal concern relates to the independence of the commission. I believe that the commission fulfils a vital function in ensuring compliance with equality and human rights law. Clearly, the discussions that are taking place between the Government, the noble Lord, Lord Lester, and the noble and learned Lord, Lord Mackay of Clashfern, are extremely important. When we get the revised Bill back before Report, we may find that many changes have been made, which will make me feel much more confident about the fact that the commission appears in certain schedules.



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Like other noble Lords, I am delighted that the commission will no longer feature in Schedule 7, and nor will any other body. However, like my noble friend Lady Thornton, I am constantly perplexed by the way in which consultations follow legislation at the moment. I hope that in future we will have consultations before legislation, because that is the right way forward.

My noble friend asked the Minister about what future Ministers might be able to do in relation to the maintenance of the commission in the schedules. I reiterate a question asked earlier by my noble friend Lord Hunt of Kings Heath about sunsetting. At an earlier stage I said that on behalf of my Benches I was very much in favour of sunsetting the whole Bill. However, when we see the recast Bill on Report, perhaps rather than sunsetting the whole Bill I might be in favour of sunsetting the schedules, so that the bodies that appear in the schedules can have some confidence that, at the end of this process and whatever has happened to them in the mean time, they will be free to evolve. They need that security of knowing that they are not constantly going to feature in the schedules. I would be grateful for the views of the Minister on sunsetting the schedules.

12.15 am

Lord Taylor of Holbeach: I thank the noble Baroness for tabling these amendments and for the productive meeting that we had earlier today. This will, I hope, be a fairly brief debate, but it has certainly been productive, because this is one of the key bodies within the Bill. It is emblematic of the desire of all noble Lords to have a facility to reform public bodies while retaining their essential core activities and their independence.

The inclusion of the Equality and Human Rights Commission in each of these schedules was not an afterthought. The Government made it clear in their announcement of 14 October that they intend to retain but substantially reform the commission, refocusing it on its core functions of regulating equality and anti-discrimination law in Great Britain, fulfilling EU equality requirements and being a national human rights institution under the United Nations. We also intend that it should provide better value for the taxpayers' money spent on it-something that it has so far failed to do.

The Government intend to set out their proposals for the commission in a consultation document shortly. I hope that this will be available on Report. However, I can assure your Lordships that the combination of needing to focus the commission on its core functions and at the same time improving its value for money means that our consultation exercise will include proposals relevant to all three schedules mentioned in this group of amendments.

The noble Baronesses, Lady Thornton and Lady Royall, raised a point about what happens to bodies having had a process of reform within the schedule. Do they remain in a permanent state of anxiety and is there a case for sunsetting? We are actively considering proposals similar to that which the noble Baronesses suggested. Above that, any statutory instrument can include a proposal for a body or office to be removed from the schedule in which it appears. It can be done

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in that way, but I appreciate the concerns of the noble Baroness. I extend an invitation to her to talk further about this because it is a mechanism that would make the Bill much more effective, if we can find ways of closing the schedules after the period of reform.

I know that this is a matter of concern to a number of noble Lords, so I can assure the Committee that we recognise the importance of the commission being able to independently administer its core regulatory functions as well as those founded on international and EU obligations. In particular, the Lord Chancellor recently made it clear when giving evidence to the Joint Committee on Human Rights that the commission's independence as a national human rights institution would remain untouched. I am happy to repeat his assurance and hope that the noble Baroness, Lady Royall, can accept it.


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