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House of Lords

Wednesday, 17 July 2013.

3 pm

Prayers—read by the Lord Bishop of Norwich.

Royal Assent

3.06 pm

The following Acts were given Royal Assent:

Supply and Appropriation (Main Estimates) Act,

Finance Act,

Marriage (Same Sex Couples) Act.



3.06 pm

Asked by Lord Clark of Windermere

To ask Her Majesty’s Government what plans they have for British troops in Afghanistan after 2014.

The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Astor of Hever): My Lords, as part of the United Kingdom’s commitment to the Afghan National Army Officer Academy, the UK will initially contribute around 90 of the 120 mentors. This will diminish over time as the Afghans increasingly work independently. In addition, we will retain sufficient force numbers to ensure that we properly protect our adviser footprint after 2014. Until NATO planning has matured, it is premature to speculate what other residual military presence the UK will have after 2014.

Lord Clark of Windermere: I thank the Minister for that Answer. Although I fully support the withdrawal of combat troops after 2014, I can understand the Government’s reluctance to be absolutely precise about the numbers remaining thereafter. However, does he accept that the new, large Afghan army will still be short of a number of military facilities, such as close air support, fuel and food delivery, and medevac? If we are to ensure that the sacrifices of our soldiers are not in vain, will the Government ensure that we help the new Afghan army in those areas in which it is short?

Lord Astor of Hever: My Lords, I am very grateful to the noble Lord for his support for our moves post-2014. We are fully aware of the issue of enabling support to the ANSF. Last year, this priority switched from growing the forces to professionalising and developing their ability to support themselves post-2014 as ISAF draws down. In addition to taking the coalition lead in supporting the officer academy, the UK will maintain its current development assistance of £178 million a year until 2017, and we will also contribute £70 million a year until at least 2017 towards sustaining the ANSF.

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Lord Lee of Trafford: In terms of medical support, following on from the noble Lord’s question, are there any plans to leave any specialist medical equipment in theatre in Afghanistan, and are there any plans for our medical personnel—those with particular specialisms—to stay there to work alongside the Afghan medics?

Lord Astor of Hever: My Lords, leaving medical equipment in Afghanistan is being discussed at the moment and no decision has been taken on that. By the end of 2013, the ANSF are due to have developed sufficient medical capabilities to take over responsibility for dealing with their own casualties with non-life-threatening injuries, known as category B casualties. By the end of 2014 they will take over responsibility for all their casualties, including the most serious types of injuries. ISAF continues to monitor ANSF progress towards an independent medical capability, and the UK is supporting it to deliver surgical capability in Helmand through the provision of medical advisors to Afghan medical personnel.

Baroness Coussins: My Lords, will the Minister update the House on what plans there are for the locally employed interpreters, who are likely to be in greater danger following the withdrawal of British troops, particularly the interpreters who are based in Kabul and elsewhere who I understand are not currently eligible to apply for the resettlement package that is being offered by Her Majesty’s Government?

Lord Astor of Hever: My Lords, we want to support those local staff who will be made redundant so that they can go on contributing to a brighter future for them and their country. This support is based on a generous in-country package of training and financial support, available for all staff, or a financial severance payment. For those who are eligible—patrol interpreter Foreign Office equivalent staff—there is the opportunity to apply for relocation to the UK.

This is a redundancy scheme and is not to be confused with our existing provisions for staff safety and protection. Any staff member who is threatened and at genuine risk due to their employment with us will be supported. In extreme cases, via our intimidation policy, it may be appropriate to consider relocation to the United Kingdom.

Lord Selkirk of Douglas: My Lords, will the Minister say whether military equipment, including vehicles and containers that are needed in Europe, are being satisfactorily withdrawn and that the plans are proceeding as intended?

Lord Astor of Hever: My Lords, as I understand it, the redeployment is progressing well. As of 30 June, we have redeployed 797 vehicles and pieces of major equipment, and 1,234 20-foot containers’ worth of materiel from Afghanistan.

Baroness Farrington of Ribbleton: My Lords, I declare an interest: a close member of my family will be in Afghanistan until the withdrawal in 2014. Will the Minister give an assurance that the protection equipment

17 July 2013 : Column 753

that is available to protect our troops will be absolutely up to standard and adequate to protect them during what may be a difficult change period?

Lord Astor of Hever: My Lords, I can assure the noble Baroness on that point. While we remain part of the ISAF combat mission in Afghanistan, UK forces will continue to maintain the military means and legal authority to defend themselves in the event of an attack. We will retain sufficient force numbers to ensure that we can properly protect our adviser footprint up until 2014 and afterwards. We will also ensure that we have sufficient access to enable this, such as medical facilities and support helicopters. I assure the noble Baroness that the answer is yes.

Lord Ramsbotham: My Lords, anyone who has had the privilege of visiting our troops in Helmand will have realised the great appreciation shown by the Afghan army for the British troops and the way that they are being trained. Currently, a Select Committee in this House is examining soft power, and soft power includes the military influence in training and spreading the British influence into other countries. I know that we are talking about the officers’ training academy, but are there intentions to carry on lower-level training, which does so much to increase our influence in Afghanistan after we have left?

Lord Astor of Hever: My Lords, the noble Lord is quite right about how much the ANSF appreciate the work we are doing to mentor them. I saw that for myself when I was last in Afghanistan and talked to a number of Afghans who are hugely appreciative of what we are doing. As the Prime Minister has said, the UK has played a very big part in the ISAF military campaign but we have also paid a very high price. It is therefore right to focus on the officer academy, which is the one thing we have been asked to do by the Afghans, rather than looking for ways to go beyond that.

Forestry: Independent Panel Report


3.14 pm

Asked by Baroness Royall of Blaisdon

To ask Her Majesty’s Government what further developments there have been since the publication of their response to the report of the Independent Panel on Forestry.

The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord De Mauley): My Lords, we have made good progress in implementing the commitment set out in our Forestry and Woodlands Policy Statement, which was issued in January this year. An updated report was published on 3 July that highlighted progress in all areas, including establishing a new body to run the public forest estate, maintaining a core of forestry expertise in government and supporting the forestry sector to improve its economic performance. We are also giving greater priority to plant health.

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Baroness Royall of Blaisdon: My Lords, I am grateful to the Minister for that Answer. How will the Government ensure that the board of the proposed public forest estate management organisation will be inclusive, taking into account the views of users and community groups such as my own HOOF, which are instrumental in safeguarding our public forests and understand every aspect of our forests, including the commercial aspects? The Minister may say that they will be among the guardians, but I firmly believe that they must also have a voice and a vote on the board. I understand that the consultation on the new structure will end in October, so can we expect legislation to be announced in the next Queen’s Speech?

Lord De Mauley: My Lords, there were quite a lot of questions in there. I can assure the noble Baroness that stakeholders will be comprehensively involved in the process. She refers to HOOF; to dispel some misunderstanding, it is worth saying that, far from reviving the spectre of privatisation, or placing Ministers in total control of our forests, as has been suggested, our proposals involve the legal transferral of ownership of the entire estate from Ministers to a new operationally independent public body. I say to the noble Baroness that there is some misunderstanding; if it would be helpful to her, I would be very pleased to have a meeting with her—and a representative of HOOF, if that would suit her—to see if we can get rid of the misunderstanding.

Baroness Fookes: Will my noble friend expand on the issue of plant health, given the very worrying plant diseases that are affecting ash, oak, chestnut and other trees?

Lord De Mauley: My Lords, yes, this is a very important matter. We have a plant and tree health task force, which has reached the conclusion of its report. It has recommended that the Government develop a UK plant health risk register and provide strategic and tactical leadership for managing those risks. It has also recommended a number of other courses of action, including developing and implementing procedures for preparedness and contingency planning to predict, monitor and control the spread of pests and diseases. We have accepted both of these recommendations and are making progress on them. It has also recommended a number of other courses of action, which we are actively considering. I had a meeting last week with stakeholders from across the interested parties to discuss those recommendations.

Lord Hylton: My Lords, I declare my interest as on the register. Do the Government have a policy for increasing manufacturing capacity for all kinds of wood products, not forgetting poplar in particular?

Lord De Mauley: My Lords, the noble Lord has reminded me that I should have declared an interest as a woodland owner. He essentially asks what we are doing to make the woodland industry more creative. There is a new concept called Grown in Britain, which is creating a new and stronger market pull for the array of products derived from our woodlands and

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forests. We are developing private sector funding that supports the planting and management of woodlands and forests through funding from corporates, as part of their corporate social responsibility, and we are connecting together and harnessing the positive energy and feelings towards our woodlands and forests that many in our society share to create a strong wood culture.

Lord Clark of Windermere: My Lords, in the Government’s response, the Secretary of State wrote on the subject of forest acquisition:

“We will focus particularly on woods close to our towns and cities where the greatest number of people can enjoy them”.

Can the Minister advise us whether there has been any success in this? If not, will he consult with the Forestry Commission England to help it bring forward some of its plans to achieve that laudable objective?

Lord De Mauley: I agree with the noble Lord that that is a laudable objective. It is early days, but we are making progress on those things. If I may, I will take the noble Lord’s suggestion back to the department.

Lord Greaves: My Lords—

Lord Framlingham: My Lords—

The Lord Bishop of Norwich: My Lords—

The Chancellor of the Duchy of Lancaster (Lord Hill of Oareford): We will hear from the right reverend Prelate first.

The Lord Bishop of Norwich: My Lords, can the Minister assure us that the Government will keep faith with the recommendation to establish guardians of the public forest estate and, if so, tell us what their role will be in relation to the new management organisation that is being established?

Lord De Mauley: My Lords, before I answer that perhaps I should reiterate my thanks to the right reverend Prelate the Bishop of Liverpool and his independent panel for the work that they did for us on this.

We envisage that there will be a group of guardians who will draw on the interests and expertise of public forest users and will be able to advise and support the delivery of the new body’s remit. The guardians will be focused on the outcomes that the management body delivers, such as environmental biodiversity and social benefits, and any questions of significant land acquisitions and disposals.

Lord Greaves: My Lords—

Lord Framlingham: My Lords—

Lord Greaves: My Lords, I am grateful. Will the Minister, with me, step back a little, think about the situation two years ago and consider how different it is now? Two years ago we were talking about the

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Government wanting to flog off most of the forestry estate. How different it is now. The Minister has congratulated the right reverend Prelate and his independent panel. Will he also congratulate the ministerial team in Defra on the way that they responded to the views of people throughout the country, in particular to the fantastic campaigns that existed? Is it not a win-win situation all round, with my honourable friend David Heath, as the Agriculture Minister, absolutely at the forefront of it?

Lord De Mauley: My Lords, I could not have put it better myself.

Territorial Army


3.22 pm

Asked by Baroness Seccombe

To ask Her Majesty’s Government, in the light of the planned expansion and reorganisation of the Territorial Army, whether they have plans to close any Territorial Army Centres.

The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Astor of Hever): My Lords, my noble friend will recall the Statement I made on 3 July, which stated that to maximise the potential for future recruitment, the Army will rationalise its presence by merging small, poorly recruited sub-units into larger sites, frequently in the same conurbation or in neighbouring communities. The overall number of Army Reserve bases will reduce from the current total of 334 to 308, a net reduction of 26 sites.

Baroness Seccombe: My Lords, the cadet movement, which one could say is the corn seed of our services, offers an exciting taste of service life and often provides a discipline that has not been part of young people’s lives. There are many alternative attractions on their doorstep. Does the Minister agree that it is vital that the cadet detachments are situated locally? Many of those detachments at present are situated within the existing territorial centres. Given the recently announced closure of some TA centres, can the Minister confirm that there will be no loss of cadet locations in the short and long term?

Lord Astor of Hever: My Lords, I agree with my noble friend. Defence has well established, challenging and vibrant cadet programmes with very high reputations, which will continue to be fully supported. Cadet units provide an important link with local communities. Where cadets are co-located on a site for which there is no longer a defence requirement, I can confirm that we will pursue reprovision of the facilities for the cadets to ensure that a local cadet presence is maintained.

Lord Rosser: My Lords, on two occasions recently the Minister has declined to give an undertaking that the size of the regular Army will not be reduced to 82,000, as intended, unless the size of the trained Army Reserve has been increased to 30,000, as intended. Since it would be a serious failure of government responsibility if the implications of this possibility

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had not been considered, will he spell out what the impact would be on the capability of our Army if the size of the regular Army were reduced to 82,000 but the size of the trained Army Reserve had increased to only 25,000 or even fewer, not to the 30,000 intended?

Lord Astor of Hever: My Lords, we intend to maintain an appropriate force level to meet our planning assumptions. We will continue closely to manage the growth in the reserves and the reduction in regular numbers. These numbers will be kept under continuous review as we move beyond the end of operations in Afghanistan. Mitigation strategies are in place to ensure that we can take early action to maintain an appropriate force level. These include innovative recruiting campaigns and measures to improve retention.

Lord Rogan: My Lords, if any TA centres currently owned and administered by regional RFCAs are closed and subsequently sold, can the Minister assure us that the proceeds of these sales will be retained by the local RFCAs, thus enabling them to improve their remaining stock?

Lord Astor of Hever: My Lords, 38 sites are no longer required for defence forces, of which 35 have been vacated by the Army. This does not necessarily assume that every surplus site will eventually become a disposal. The future of each vacated site will be taken forward on a value-for-money basis in consultation with the interests of the local communities involved. If the site is owned by the MoD, once vacated it will be handed over to the Defence Infrastructure Organisation and offered to other government departments. If no other use is found, it will be disposed of.

Lord Addington: My Lords, will the Minister give us a little more information about the nature of the local centres of recruitment for this new territorial reserve? Unless you can get to them easily, the idea that people will become a part of it voluntarily will be damaged.

Lord Astor of Hever: My noble friend makes a good point. Working with local communities is vital. We are very grateful for the support that reservists and, indeed, regulars receive from their local communities, and we hope that this will continue. While we are vacating a small number of sites, we will retain more than 300 locations across the UK where individuals can undertake service in the Army Reserve.

Lord Foulkes of Cumnock: My Lords, I declare an interest as a former member of the Territorial Army. I know that that surprises some people opposite. I may be a bit simple, but could the Minister explain the logic, when the Government are seeking to increase the number of members of the Territorial Army, of closing TA centres?

Lord Astor of Hever: My Lords, I am not at all surprised that the noble Lord was in the Territorial Army. He has that military demeanour, and cut a fine

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dash when he came into the Ministry of Defence the other day. We need to expand the Army Reserve to reflect the future liability of 30,000 trained reservists. To deliver that, the supporting structure needs to be changed. We are confident that the Army Reserve will continue to demonstrate its ability to adapt to new requirements.

Lord Brooke of Sutton Mandeville: My Lords, how many of the 35 sites that will no longer be used are in Scotland?

Lord Astor of Hever: My Lords, there are seven sites in Scotland where there is no longer a requirement for Army Reserve basing as a result of structural change. These are Wick, Bothwell House in Dunfermline, Sandbank, Keith, Kirkcaldy, Carmunnock Road in Glasgow and McDonald Road in Edinburgh. One site, Redford cavalry barracks in Edinburgh, will be reopened.

Lord Clark of Windermere: My Lords, how are the Government to expand the provision of officer training courses in groups of universities?

Lord Astor of Hever: My Lords, I am not briefed on officers at universities but I think that the answer is yes; we want to continue that and grow it because it is an important source of officers for the reserves.

Whole-life Sentences


3.29 pm

Asked by Lord Lloyd of Berwick

To ask Her Majesty’s Government what is their response to the decision of the European Court of Human Rights in the case of Bamber and others vUnited Kingdom.

The Minister of State, Ministry of Justice (Lord McNally): My Lords, the Government are disappointed with the court’s ruling. We are making a full analysis of the judgment and will provide our considered response in due course.

Lord Lloyd of Berwick: My Lords, the noble Lord will be aware that the Grand Chamber of the European Court of Human Rights recently decided by 16 votes to one that the 49 prisoners currently serving whole-life sentences in the United Kingdom are entitled to a review after 25 years. A review does not mean that they will necessarily be released. Can he confirm that whole-life prisoners had always been entitled under our law to a review after 25 years until they lost that right in 2003, it seems almost as a result of an oversight? Will he therefore ensure that the right to a review after 25 years is restored to all our whole-life prisoners as soon as possible in accordance with the court’s decision?

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Lord McNally: My Lords, first, I am grateful to the noble and learned Lord for setting out the chronology very accurately. The right to review was there until 2003. Whether its removal was by an oversight, I do not know, but removed it was. All that I can say about the court’s judgment I said in my Answer—we are analysing it and will provide a considered response in due course.

Lord Thomas of Gresford: Are the Government aware that the suggestion made by the noble and learned Lord, Lord Lloyd, was part of the judgment of the British member of the court, Judge Mahoney, who unreservedly subscribed to the conclusions and reasoning of that judgment? Ought not the Government give extra weight to the views of the British judge in that regard?

Lord McNally: My Lords, I am not sure whether in an international court one would take cognisance of one judge over another—I am not sure of the protocol of such courts. I do know that it was a considered judgment that merits careful study by the Government, which is exactly what we are doing.

Lord Morgan: My Lords—

Lord Tomlinson: My Lords—

Lord Morgan: My Lords, does not this judgment raise the very important legal principle of rehabilitation? It does not say that whole-life prisoners should be released or that the British Government should take any action, but it does suggest that they retain what the court called the right to hope, the possibility of atonement and the possibility of a review, as in many other countries. Is this not a very serious issue of penal philosophy that should be considered as such?

Lord McNally: My Lords, I fully agree with the noble Lord, and I think that both interventions have helped to clarify something that is not necessarily clear in coverage by the media. This judgment did not say that anybody should be released immediately or that whole-life tariffs may not be imposed, but it did say that we should look at such sentences in the light of what was described as penological purpose—punishment, rehabilitation and prevention. The court held that the system in England and Wales, which provides only for compassionate release, was not sufficient.

Lord Elystan-Morgan: My Lords, does the Minister accept—

Lord Tebbit: My Lords, it is this side.

Lord Elystan-Morgan: Cross Benches!

The Chancellor of the Duchy of Lancaster (Lord Hill of Oareford): My Lords, it is this side. Then I am sure we will have time if we get a crack on.

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Lord Tebbit: My Lords, can my noble friend perhaps read out a list of the names, nationalities and legal qualifications of the judges who interfered in our affairs?

Lord McNally: I think the best thing that I can do is place a list in the Library. Over the years, the court has held against Britain in about 3% of cases. During that period, we have had the great benefit of being part of a continent-wide concept of upholding human rights, of which we should be proud.

Lord Elystan-Morgan: Does the Minister accept that implementing faithfully a decision of the European court is not a peripheral luxury but something that binds us in law and in honour, and that the greatest architect of this institution was in fact Sir Winston Churchill?

Lord McNally: There are a number of architects; Sir David Maxwell Fife was a notable originator. However, what the noble Lord said is absolutely right. That is precisely why, given the importance of this judgment, we intend to give it a full analysis and will provide our considered response in due course.

Lord Tomlinson: Does the Minister agree that we do incredible damage to our international reputation for upholding the rule of law when, every time we get a judgment from the European Court of Human Rights, there is a knee-jerk reaction from Members in another place, calling for us to abrogate our responsibilities under the European convention?

Lord McNally: My Lords, that is why my Answer to this House is that we are making a full analysis of the judgment and will provide our considered response in due course.

Hereditary Peers By-Election


3.37 pm

The Clerk of the Parliaments announced the result of the by-election to elect a hereditary Peer in the place of Lord Reay in accordance with Standing Order 10.

Three hundred and thirty-four Lords completed valid ballot papers. A paper setting out the complete results is being made available in the Printed Paper Office. That paper gives the number of votes cast for each candidate. The successful candidate was Lord Borwick.

Delegated Powers and Regulatory Reform Committee

Membership Motion

3.37 pm

Moved by The Chairman of Committees

That Baroness Farrington of Ribbleton be appointed a member of the Select Committee.

Motion agreed.

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Draft Deregulation Bill Committee

Membership Motion

3.37 pm

Moved by The Chairman of Committees

That the Commons message of 11 July be considered and that a Committee of six Lords be appointed to join with the Committee appointed by the Commons to consider and report on the draft Deregulation Bill presented to both Houses on 1 July (Cm 8642) and that the Committee should report on the draft Bill by 16 December 2013;

That, as proposed by the Committee of Selection, the following members be appointed to the Committee:

B Andrews, L Mawson, L Naseby, L Rooker, L Selkirk of Douglas, L Sharkey;

That the Committee have power to agree with the Committee appointed by the Commons in the appointment of a Chairman;

That the Committee have power to send for persons, papers and records;

That the Committee have power to appoint specialist advisers;

That the Committee have leave to report from time to time;

That the Committee have power to adjourn from place to place within the United Kingdom;

That the reports of the Committee from time to time shall be printed, regardless of any adjournment of the House; and

That the evidence taken by the Committee shall, if the Committee so wishes, be published.

Motion agreed, and a message was sent to the Commons.

Armed Forces (Retrial for Serious Offences) Order 2013

Armed Forces (Court Martial) (Amendment) Rules 2013

Motions to Approve

3.38 pm

Moved by Lord Astor of Hever

That the draft orders laid before the House on 17 June be approved.

Relevant document: 6th Report from the Joint Committee on Statutory Instruments, considered in Grand Committee on 8 July.

Motions agreed.

Producer Responsibility Obligations (Packaging Waste) (Amendment) Regulations 2013

Motion to Approve

3.38 pm

Moved by Lord De Mauley

That the draft regulations laid before the House on 13 June be approved.

17 July 2013 : Column 762

Relevant document: 5th Report from the Joint Committee on Statutory Instruments, considered in Grand Committee on 8 July.

Motion agreed.

Mesothelioma Bill [HL]

Mesothelioma Bill [HL]


Relevant documents: 1st, 2ndand 6thReports from the Delegated Powers Committee.

3.39 pm

Clause 1 : Power to establish the scheme

Amendment 1

Moved by Lord Freud

1: Clause 1, page 1, line 3, after “may” insert “by regulations”

The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud): My Lords, I thank noble Lords once again for their commitment to this Bill and for their amendments. Before dealing with this group of government amendments, I will make some general remarks and explain some of the work that has gone on since we last met in Committee.

In Committee, many noble Lords expressed concern at the close working with the insurance industry that this Bill has necessitated. The noble Baroness, Lady Masham, expressed particular concern that the appointment of a scheme administrator was already a done deal with insurers. I offer my assurance that this is not the case and that we intend to run an open competition for the contract of scheme administrator, which will be chosen through the open tender process according to our commercial criteria. I hope this reassures noble Lords.

Turning to the issue of poor record-keeping practice in the industry, I think we all agree that we must work not only to support those who have fallen foul of poor record-keeping and tracing in the insurance industry but to correct it and stop it happening in the future. The creation of the Employers’ Liability Tracing Office—ELTO—was a step in the right direction, but there are still insurers that are not tracing as they should be. Since we last met, I have had a very positive meeting with the Financial Conduct Authority. I have since received a very informative letter from the FCA. I found the following extract particularly positive:

“We are further strengthening our existing rules with new requirements for firms to have effective processes for conducting tracing searches for historical policies upon receipt of a request from a consumer or a consumer’s representative. These new rules will become effective from 4 December 2013. We therefore expect any firms that do not currently have adequate tracing mechanisms in place to develop them in advance of that date”.

In brief, if an insurer is expelled from ELTO for not tracing as it should or the FCA receives other intelligence suggesting poor or non-existent tracing, this will serve as an immediate red flag to the FCA. It will then put into place its enforcement action, which can include a supervision visit from the FCA.

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One further step that the FCA is taking, which was detailed in the letter, gave me particular confidence that the appropriate mechanisms are in place to ensure compliance. The letter states:

“We also look to gather market intelligence to assist us in taking a risk-based view. We are exploring the possibility of a memorandum of understanding with ELTO that, subject to the legalities of this, would allow the FCA to access the data from ELTO’s own auditing process. This would allow us to concentrate our supervision resources on higher-risk categories of firms”.

I hope that noble Lords who have been following this so intently can agree that this represents very positive progress.

Another issue that we discussed in Committee was the establishment of an oversight committee. We welcome this proposal and have been exploring with stakeholders how it might operate. As ever, there is a range of options that we need to consider, and we continue to do so. We would prefer a non-legislative solution if possible but we are aware that noble Lords may wish to see something on a more statutory footing. I ask noble Lords to consider the issues associated with trying to establish a new non-departmental public body as we discuss oversight further.

3.45 pm

Another issue that rightly received significant attention in Committee was that of the rate of payments to be made. Perhaps it will help if I outline how we have arrived at where we are on this matter. Insurers have made it clear that paying an amount equal to 3% of employer’s liability gross written premiums is affordable, to the extent that they should not then need to pass these costs on to employers. The costs of the scheme in the first few years will be higher because all eligible people diagnosed between 25 July 2012 and the start of the scheme will be paid alongside people diagnosed at the time— contemporaneously—so we have introduced a four-year smoothing period to ease that initial spike in cost.

The ABI’s analysts advised it that paying people 70% of average civil compensation equates to the 3% of employer’s liability gross written premiums which they maintain it can absorb, whereas our analysis shows that the 70% tariff equates to less than 3% of written premiums. This is because the ABI’s analysts and our own forecasts on numbers of applicants coming to the scheme also differ, and we have been unable to reconcile these discrepancies. I should mention at this point that when we refer to a percentage of average civil damages, the figures we are using are those published by the National Institute of Economic and Social Research. We have already published an ad hoc statistical report, setting these figures out.

In Committee, the Government proposed that the scheme should start paying people at the rate of 70% of average civil compensation. I stated previously that our intention was that the figures obtained from this equation will be uprated annually, in line with CPI. In addition, I have agreed that the amounts of civil compensation in mesothelioma cases must be current if we are expressing scheme payments as a percentage of civil compensation. I suggested that a review of the data every five years would enable meaningful trends to appear, given the relatively low volume of such cases.

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We will certainly be reviewing the level of civil compensation in mesothelioma cases on a regular basis and amending scheme payments accordingly. Nevertheless, I understand noble Lords’ desire to pay people at a rate higher than 70% of civil compensation.

Following the debate in Committee, I have been in further discussions with insurers and have been able to secure an agreement to pay 75% of average civil compensation. This is more than the industry wanted to pay but, using the government analysts’ figures, it halves the gap in the percentage of employer’s liability gross written premiums between what was originally offered and the full 3%. I take this opportunity to thank noble Lords and to acknowledge that the pressure in this House on this matter has been a key driving force in achieving the increased rate. I know that noble Lords would like the scheme to pay even more than the 75% we have now achieved. However, we need to be certain that the industry can afford to pay more without passing disproportionate costs on to employers. The insurance industry guaranteed to us that if we keep the levy within proportionate limits, it will not increase premiums. We would need more clarity on the numbers of applications to and costs of the scheme as a percentage of gross written premiums.

Since we last met, we have been working on a proposed review process for the scheme, which I know noble Lords will welcome. I expect to be able to present firm details of such a process when we take this Bill to the other place but, for the time being, I will outline my ideas. We intend to look at the actual number of applications and real costs once the scheme has been running for long enough to give us reliable data. As I indicated when we previously discussed increases in average compensation payments, looking at numbers too soon would not provide us with stable data, nor would it show us much by way of trends.

The initial four-year costs-smoothing period would give use an ideal opportunity to collect actual numbers and costs. We would then be able to see what the real cost of the scheme is, compared to the current expectations about the percentage of gross written premium it will take up. We would also be able to assess whether or not costs had been passed on to industry and to what extent. That would put us in much better position to carefully consider whether we have set scheme payments at the right level and how far current actuarial assumptions have been borne out in practice. We have to be prepared for the fact that the ABI’s analysts may be nearer the mark here, as we are dealing with behaviours in making applications to the scheme which are not easy to predict. We also need to bear in mind that costs to insurers will eventually reduce anyway as the numbers coming to the scheme will fall as time passes and fewer people are diagnosed with mesothelioma.

To summarise, we intend that scheme payments will rise in line with CPI each year. In addition, if the level of civil compensation also changes, we need to look again at the amount of the scheme payment to see if it should be changed in line with that of civil compensation. The initial four-year costs-smoothing period gives us an ideal opportunity to collect actual numbers and costs and to look at the level of scheme payments in a much clearer light. It will also give us an opportunity

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to assess any reaction by the insurance industry that there might have been over the first four-year period. These proposals show that the current level of scheme payments strikes the right balance between paying people with mesothelioma and levying an amount from insurers that will not inevitably be passed on to employers. I also trust that I have reassured noble Lords that the Government are committed to considering necessary changes when an increase is justified.

I reiterate that the Government’s intention is to support eligible people suffering from this terrible disease and to start making payments as soon as humanly possible. Indeed, timing is paramount. Mesothelioma deaths are expected to peak in 2015 and we aim to have a scheme in place by April next year. I ask noble Lords to keep this in mind during today’s debate. Any delays will affect the very people we are trying to help. I hope noble Lords will forgive me for taking up time on these issues but they are critical as we consider the detail of the Bill.

Lord Browne of Ladyton: If your Lordships’ House will permit me to intervene, I do not intend to engage in debate with the Minister at this stage on any aspects of his commendable “pre-statement”, for which I thank him. It is consistent with the attitude that he has shown to this legislation and his handling of it in the course of our consideration. However, there is another matter which, as he knows, I have been discussing with the Bill team, which is not reflected in the proposed amendments on Report and which, therefore, will not be directly raised.

My concern is about the clarity of the drafting of Clause 2 and the interaction of parts of it. Without going into the detail of that, I have been in discussion and correspondence with the Bill team, and I am grateful to the Minister for allowing that to happen. We did not bottom-out our discussions about the fundamental issue but we revealed a number of things about the interaction between the draft rules and Clause 2. Before I came into the Chamber this afternoon, I got an e-mail saying that there was a recognised tension in relation to the issue of limitation between the draft rules and the current drafting of Clause 2. If the Minister is not in a position to say anything about this now, perhaps he will make time to say something on Report so that it will be on the record and will go to the other place to be considered.

Lord Freud: My Lords, I know that the noble Lord does not want me to go into detail, but I can commit to going on working with him on this issue, which is very technical. If we work out that something needs to be adjusted, we will have time to do it in the other place.

Lord Wigley: I express my appreciation for the increase from 70% to 75%, although a lot of us would have liked to see 100%. I would like clarification on the new matter that the noble Lord introduced with regard to the review. The mechanism for this might be introduced in another place. Will he shed some light on the means by which any changes could be implemented? Will order-making procedures be available, or will it be a matter of going back to primary legislation whenever such changes are needed in the light of developments?

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Lord Freud: My Lords, I think that how we do this will go into secondary legislation. We are well covered. If we need to make an adjustment at primary level, clearly we will have an opportunity in the other place. However, my desire here, for reasons that noble Lords will understand, is not to have ping-pong between the two Houses, because I do not want to lose the extra weeks that could be taken up. If I am wrong in saying that this does not need primary legislation, I will write to the noble Lord. However, that is my view, without checking.

I turn to Amendments 1, 3, 7, 9, 10, 14, 31 and 33.

Lord Wills: I, too, thank the Minister for the work that he has done so far on the Bill. It represents an enormous step forward, for which the House is extremely grateful. The noble Lord, Lord Wigley, raised a very important point. It is infinitely preferable not to have to resort to primary legislation in future should changes be necessary under the review process. If the Minister feels that the Bill is not adequate in giving powers to the then Secretary of State to introduce any changes by secondary legislation, will such provisions be introduced at Third Reading or in the other place?

Lord Freud: Perhaps noble Lords will indulge me and allow me to reply to that question a little later this afternoon. It is a very technical question and I will double-check that my answer was reliable. I will come back to it. We will have another chance.

If there are no further interventions, I will turn to the rather drier amendments in this group. A number of noble Lords present today tabled amendments in Committee to require the rules establishing the payment scheme to be made by statutory instrument rather than having them simply published by the Secretary of State. The amendments in this group are aligned with a recommendation of the Delegated Powers and Regulatory Reform Committee. Again, I acknowledged the concerns behind these approaches. Today I am pleased to announce that this set of amendments aims to establish the diffuse mesothelioma payment scheme by statutory instrument rather than by publication by the Secretary of State.

Having made this change, a number of consequential amendments fall to be made to other clauses, so that previous references to “regulations” will now refer to “the scheme”. Before noble Lords suggest that I am taking a backward step by amending the Bill so that it refers to “the scheme” instead of “regulations”, I should add that the combined effect of the amendments will be that where “regulations” has been changed to “scheme”, it will mean the scheme as set up by regulations.

We have also removed the ability of the Secretary of State to amend, replace or abolish the scheme, or publish the scheme as amended from time to time, as these matters will now be dealt with in regulations—as will the definition of a “specified payment” in Clauses 2 and 3. In addition, provisions for the amount of a scheme payment, for payment amounts to be dependent on age, and for the division of scheme payments between dependants are all now to be determined in accordance with scheme regulations. The same applies to the circumstances in which a person is or is not to

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be treated as able to bring an action against the relevant employer or any relevant insurer for civil damages. These will now be dealt with in scheme regulations.

Amendment 31 provides for the first regulations setting up the scheme under Clause 1 to be subject to the affirmative resolution procedure, where the regulations must be approved by a resolution of both Houses of Parliament and for subsequent regulations to be subject to the negative resolution procedure. This approach follows a recommendation from the Delegated Powers and Regulatory Reform Committee. I thank noble Lords for their well informed views when we addressed this matter. I beg to move.

4 pm

Lord Avebury: My Lords, I thought it was best to defer my thanks until after the Minister had completed his remarks on this group of amendments. I express my warm appreciation for the considerable work that he has done on the Bill, resulting in his welcome announcement this afternoon that the payments will increase from 70% to 75% for civil compensation claims. Although that falls well short of what some of us had hoped for originally, I have to say it compares with the estimated £1 billion of cost that would have been paid by the insurance industry if the employers had not gone out of business and the employers’ liability insurance policies had not been lost or, in some cases, possibly deliberately destroyed. That £1 billion is estimated by the Asbestos Victims Support Groups Forum UK as the amount that has been forgone over the years by victims, who have not been able to formulate claims for the suffering that they endured. At this stage, however, we have to be grateful and I echo the thanks expressed by others to the Minister for achieving this improvement in his discussions that he had with the insurance industry.

I should also like to take the opportunity to ask the Minister about a discrepancy in the DWP’s July 2013 analysis, which has been circulated to noble Lords. Column 6 of table 5 relates to the total amount of the levy from the start of 2010 to 1 July this year. On the assumption that that is based on 100% of average civil compensation, the figure would have been £118.9 million. The amount that individuals would have received directly from the scheme over this period, according to column 5, is £98.5 million. Adding the £20,480 estimated cost per claimant—

The Countess of Mar: My Lords, I am sorry to interrupt the noble Lord, but we are debating Amendment 1, which the noble Lord, Lord Freud, has moved. Would the noble Lord, Lord Avebury, care to address that?

Lord Avebury: I thought that this was the appropriate opportunity to raise a point about the document that has been circulated and, if nobody objects, I shall continue with my remarks, which I can assure the noble Countess will be very short. This is the only opportunity that I will have to ask this question about the discrepancy in the figures that have been circulated by DWP. As I was saying, adding the £20,480 estimated cost—

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The Countess of Mar: I am sorry, but the noble Lord is not speaking appropriately to the amendment that the noble Lord, Lord Freud, has moved. Would he address that, or would he prefer to sit down and ask his questions when we have later amendments on the subject?

Lord Avebury: If the Minister is prepared to listen to my question, we shall come to an end in a few minutes.

The Countess of Mar: This is Report stage and we should be addressing the amendments of the noble Lord, Lord Freud.

Lord Ahmad of Wimbledon: Perhaps I may clarify matters. The noble Countess is quite correct. This is Report and we should be addressing the amendment. I would ask my noble friend to make his point when we reach the relevant amendment.

Lord McKenzie of Luton: My Lords, I start by thanking the noble Lord for the amendments, which we support. Putting the scheme on a statutory basis responds to the debate that we had in Committee and to the recommendations of the Delegated Powers Committee. I thank him for that.

Perhaps I may be allowed the opportunity to pick up a few points from the noble Lord’s opening statement—again, the thrust of which we are very happy with and supportive of, particularly the open competition for the scheme administrator. That is a very positive move. In addition, the improvement to the record-keeping, the progress of ELTO and the engagement of the FCA are to be welcomed. We knew the Minister’s view on the oversight committee and hoped that it would be possible for him to table amendments for today. However, as that has not proved possible, we hope that there will be a commitment to do so when the Bill goes to the House of Commons.

We support the 75% as an improvement on the opening position. I hope that the noble Lord will not misinterpret subsequent amendments that we have tabled as being ungrateful for the efforts that he has made but I think that we have an obligation to pursue the matter further. The noble Lord put an important issue on the record concerning the scheme, its uprating and the review. The CPI uprating is to be welcomed, as is the review based on the practice and outcomes of the smoothing period. The key issue here, certainly after the initial—

The Countess of Mar: Again, I am sorry to interrupt the noble Lord but I wonder whether he will address Amendment 1 moved by the noble Lord, Lord Freud.

Lord McKenzie of Luton: My Lords, I have addressed it and was simply taking the opportunity to pick up a few points from the Minister’s opening statement, with which I think he was trying to be helpful in setting the scene for this. I was also trying to be helpful by saying what our position is on that. It seems to me that that is my responsibility at this Dispatch Box on

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behalf of the Opposition. We have tabled an amendment, so we can pick that up in due course. The key thing for us is whether the levy rate will be reduced at the end of that four-year period or whether it can be maintained at its opening level. Obviously that will have beneficial implications for the rate of payments in due course, but perhaps we will come to that on some of our later amendments. However, I support the amendment moved by the Government.

Lord Freud: My Lords, perhaps I may quickly touch on some of those issues. The point raised by my noble friend Lord Avebury will be dealt with in the third group of amendments, but, as he shrewdly spotted, the figure of 75% comes out at £75 million of costs.

The Countess of Mar: I am sorry to interrupt the Minister but would he please address his amendments and not the bits between?

Lord Freud: I have very little to say because very few points have been raised about the amendments, but I do want to make one point. I was asked whether the review needed primary legislation and I said that it did not. I confirm that it can be done in regulations, as I was fairly sure it could.

I would not call any Member of this House ungrateful. I have genuinely always gained an awful lot from noble Lords when we go through these really complicated matters, whether in relation to the Welfare Reform Bill or the Mesothelioma Bill. In this case, in Committee I gained an awful lot from what people were telling me and I did my very best to act on that. That said, and with the intention of satisfying the noble Countess, Lady Mar, I hope that noble Lords will agree the amendment.

Amendment 1 agreed.

4.15 pm

Amendment 2

Moved by Lord Alton of Liverpool

2: Clause 1, page 1, line 6, at end insert “, and

“( ) fund research into mesothelioma (through the research supplement under section (Research supplement))”

Lord Alton of Liverpool: My Lords, in moving Amendments 2, 20, 21, 22, 23 and 24, I join other noble Lords who have expressed their thanks to the noble Lord, Lord Freud, the Minister, for doing an incredibly tough job over the last year or so. It has been very well done. I am very grateful for his remarks earlier.

The Minister said that if the Bill were delayed—none of us intended to do that—it could cause further problems in due course. Nevertheless, I just hope he accepts that that is no reason for curtailing due parliamentary process in any way. Of course, it is up to the Government to decide what to do in another place. If your Lordships decide to include amendments to the Bill here, it will not be Members of another place who precipitate the ping-pong; it will be the Government.

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With those words, I refer the noble Lord to the all-party support for this group of amendments, and to the letter that was sent to him and other Members of your Lordships’ House, signed by some 22 Members. They include some of the leading authorities on medical research and the law and others with first-hand knowledge of a fatal disease that claims 2,400 lives annually and is predicted to kill a further 56,000 British citizens between 2014 and 2044. Dr Mick Peake, the clinical lead at the National Cancer Intelligence Network, is right when he says, “We must make every effort not to miss this opportunity to lead the world in this area and to finally make significant inroads into this dreadful disease for patients and their families”.

The amendments before your Lordships seek to impose a levy of no more than 1% to raise funds to support research into the causes and treatment of mesothelioma, and have the wholehearted support of the British Lung Foundation. I thank it, and especially my noble friends Lord Walton of Detchant and Lord Pannick, and the noble Lord, Lord Avebury, who are co-sponsors of the amendments, and noble Lords who spoke in Committee and who through constraints of time might be unable to do so again today.

At the conclusion of Committee, it was the Minister who encouragingly said:

“Well, my Lords, I feel like adding my name to the amendment”.

As recently as Monday, I met the Minister again—once again, I am grateful to him and his team of officials for the time and courtesy they have unfailingly given—to see whether we could find a way for him to translate that desire into a reality. I have offered to withdraw this amendment if the Government undertake to introduce their own at Third Reading, or indeed in the other place, and that offer still stands. Although I feel that the noble Lord has been a victim of the Whitehall curse, I want to put on the record that he has been deeply committed to ensuring more support for research. However, as he told us in Committee:

“I have hit a brick wall at every turn”.

It is Parliament’s job to demolish such brick walls.

Although new figures published yesterday show that the MRC has made a helpful increase in funding for mesothelioma research, the sums are still very modest and should be seen in the context of years and years of virtually no state funding. When viewed alongside the two cancers of closest mortality in the UK—myeloma and melanoma—the funds for mesothelioma still lag considerably behind. Unlike many other forms of cancer, rates of mesothelioma are still rising. The United Kingdom already has the highest mesothelioma mortality rates in the entire world, yet there is little by way of effective treatments and at present no chance of a cure.

This shocking situation was underlined by the Minister himself, who candidly told us in Committee:

“Something very odd is happening here when so little money has gone into research in this area”.

In Committee he agreed that,

“There needs to be a kick-start process to get research going”.—[Official Report, 5/6/13; col. GC250.]

That is precisely what this amendment does. It is a kick-start.

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In a letter sent by his department to all Members of your Lordships’ House on Monday, the Minister reiterated his support for increased support for research, but said that, “unfortunately, the mechanism proposed is just not viable”.

With the assistance of the British Lung Foundation, I took the precaution of asking Daniel Greenberg QC to draft this amendment with me. I did so not simply because he is the editor of Craies on Legislation, Stroud’s Judicial Dictionary, Jowitt’s Dictionary of English Law, Westlaw UK Annotated Statutes and editor-in-chief of the Statute Law Review, but perhaps most importantly because he was parliamentary counsel from 1991 to 2010. Clearly, he knows a thing or two about drafting legislation, and presumably the Government would not cast doubt on the viability of the reams of legislation that he drafted for them.

The Minister will forgive me but in the nearly 35 years since I entered Parliament, I have heard the phrases “not viable” or “technically defective” as the refuge of last resort whenever we run out of good arguments. If the argument for a levy lacked viability, it would cast doubt on the whole principle that underpins this Bill, which is based on the imposition of a levy.

The Minister will recall that before Committee he was briefed to oppose the amendment on the grounds that there was no precedent for hypothecation and to raise that other old bogey of “legal obstacles”, the Human Rights Act. To answer those objections, noble Lords gave the noble Lord the precedent of Section 123 of the Gambling Act 2005, Sections 24 and 27 of the Betting, Gaming and Lotteries Act 1963, the HGV Road User Levy Act 2013, and other industry levies, including the fossil fuel levy, the levy on the pig industry to eradicate Aujeszky’s disease and the Gas Levy Act 1981. As my noble and learned friend Lady Butler-Sloss and my noble friend Lord Pannick made abundantly clear, the idea that such a levy was an infringement on the Human Rights Act is, frankly, risible. Indeed, my noble friend Lord Pannick said:

“It would be quite fanciful to suggest that there is a legal reason not to support an amendment”.—[Official Report, 5/6/13; col. GC 247.]

None of those shadow-boxing parliamentary arguments will do. They are simply not worthy of an issue that has lethal consequences for so many of our countrymen. Why has mesothelioma research had this Cinderella status? Why does it require Parliament to put it right? Why has it for so many years received little or no state funding? In Committee, the Minister provided clues. He said that mesothelioma,

“was an unfashionable area to go into and therefore the people who wanted to make their careers in research turned to other cancers. As a result, good-quality research proposals were not coming in and therefore the research council did not feel that it could supply funds. That is the reason and it has been the reason for decades”.—[

Official Report

, 5/6/13; col. GC 253.]

The advisers to the Minister at the DWP have written that there is no lack of necessary skills for research into asbestos-related diseases but that there are perverse incentives to tackle what are perceived as more tractable research questions or tumour types that are considered easier to study and, where possible, to build on past progress. They said that research bids that were seen as likely to fail were not being presented.

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Therefore, it is not a lack of capacity in the field that is the problem; as my noble friend Lord Kakkar outlined in Committee, many eminent researchers are interested in mesothelioma research. High-quality bids have been in short supply in the past decade precisely because leading academics knew that it was pointless putting time and effort into preparing a bid that was unlikely to succeed.

Dr Robert Rintoul, consultant respiratory physician at Papworth Hospital and chief investigator of the recently launched mesothelioma tissue bank, told me that if more funding is made available, big labs will suddenly get interested in mesothelioma, which will increase the quality of research grants. Dr John Maher, honorary consultant immunologist at King’s College Hospital, said, “As I write, we have a clinical-grade viral vector ready for use, an optimised and patentable manufacturing process and a recently licensed GNP manufacturing facility available to generate cell products. However, there are no realistic prospects of obtaining funds to undertake such work in mesothelioma in the near future”. There clearly is no question that further investment in mesothelioma research is urgently required.

We have heard from the Minister that this will peak in two years’ time, but listen to this stark warning from Dr Stefan Marciniak, the honorary consultant physician at Cambridge University’s Institute for Medical Research, who told me that there will be a continued increase in cases worldwide well into this century owing to the ever-increasing use of asbestos in the BRIC countries, and that carbon nanotubes share frightening similarities with asbestos-like minerals and could lead to a second wave of mesothelioma. That is why we need urgent research

I am delighted to see the Minister and his noble friend Lord Howe on the Front Bench today. The Minister will be sponsoring a reception later this month on mesothelioma research for an invited audience of some 40 people. I know that he will agree that such meetings, welcome though they are, are not enough and certainly not a substitute for statutory obligations. By themselves, such initiatives are unlikely to lead to the sea change in investment that is needed to ensure that the recent advances in mesothelioma research are sustained. If we do not seize this legislative moment, all the talk will vanish into the ether. It will be the informal approach that lacks viability, not this amendment.

As my noble friend Lord Walton of Detchant suggested in Committee, the amendment proposes that the funds be administered by a competent third party, which would have no difficulty in investing in all the different types of research that are so urgently required. We need both a statutory levy on the insurance firms and a greater effort from our public research institutions in dealing with a disease that will kill more than 2,000 people every year in the United Kingdom. It is vital that we as legislators grapple with the source of so much misery and suffering, which is the reason, after all, for the millions of pounds of compensation payments for which the Bill provides.

The amendment proposes a commendably simple approach and, crucially, has not been opposed by the insurance industry, whose representatives I met last

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week. No letter has been received by Members of your Lordships’ House from the industry opposing this very modest amendment.

Having listened to suggestions made in Committee by the noble Lord, Lord McKenzie, and others, we explicitly provide in the amendment for the scheme—a levy of no more than 1%—to be proportionate. The supplement reflects insurers’ market share, as the main levy contained in the Bill already does.

In the face of a vicious disease that according to the Government’s figures will claim the lives of some 56,000 more British citizens and the lethal nature of which we have known about since the Merewether report of 1930, it would be nothing short of a national scandal if we did not seize this rare legislative chance to offer those who have faced the blight of this horrific disease something better than what has gone before. I beg to move.

Lord Walton of Detchant: My Lords, I have been pleased to add my name to this amendment, so forcefully and ably proposed by my noble friend Lord Alton. This is an appalling and tragic disease. Although my specialty was never respiratory medicine, in the course of my professional career I saw many people suffering from mesothelioma and recognised to the full its utterly devastating effects. Indeed, one such person was a professional colleague of mine who was a consultant neurologist. One of the disease’s most unfortunate features is that, after exposure to asbestos, particularly blue asbestos, the incubation period is extraordinarily long. People sometimes do not develop the disease for many years after exposure. Indeed, I recently learnt of an 87 year-old man who had developed mesothelioma for the first time, having worked at the age of 40 as carpenter cutting up sheets of asbestos. That is one of its appalling features, and its effects are utterly distressing. It is not a localised cancer that grows in a single location where a surgeon can remove it; it is a diffuse involvement of cancerous tissue that grows over the surface of the lung, between the lung and the chest wall. It gradually begins to strangulate the lung and eventually causes respiratory failure. It is a devastating disease—I need say no more.

However, as my noble friend has said, research on this topic is extraordinarily limited. I speak as someone who had 14 years’ involvement with the Medical Research Council, ending up as a member of the council for four years. At that time, we received research grant applications from a huge number of notable doctors and scientists seeking to research particular conditions.

The MRC, as part of its policy, used to identify priority areas which it saw as requiring further research effort, but it did not identify single diseases such as mesothelioma. It talked about problems of mental health, and about problems of ageing. Even the notable Cancer Research UK campaign, which has been a massive contributor to research in cancer in the broadest sense, has not identified single-disease conditions as having a particularly high priority in its programmes.

It is interesting that the British Lung Foundation and four leading insurance firms three years ago reached an agreement under which they collectively granted £1 million a year for three years to invest predominantly

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in mesothelioma research. The results were impressive. New researchers from other fields who had never thought of working on mesothelioma started to take an interest. This led to the creation of Europe’s first mesothelioma tissue bank, storing biological tissue and funding work to identify the genetic architecture of the disease.

My experience as a doctor, having been involved with a huge number of different charities funding research over the years, is that the existence of charities that are established to support research on single diseases has been immensely valuable and important in attracting new scientists into the field for which they have provided funds. One has to think only of the British Heart Foundation, which has given a massive impetus to work on heart disease. Without the money which the Multiple Sclerosis Society has collected over all the years, we would never have had the same effect.

In my research field of neuromuscular disease, had it not been for the work of the Muscular Dystrophy Campaign there is little doubt that we would not have reached the stage that we now have, where research on exon skipping has led to the introduction of a drug for the treatment of the most severe form of the disease. Those are massive developments, but they came about because funds had been raised by individual charities and groups specifically for research in that disease.

As my noble friend said, until this recent initiative by the British Lung Foundation, the funding for research on mesothelioma had been miniscule. Unfortunately, the funding by the BLF and others has now run out. The sole purpose of the amendment is to persuade the Government to accept that a tiny percentage of the levy which they already lay on insurance companies for the support of patients with this condition and their families should be specifically devoted to research. That could make a massive contribution to the future of patients with mesothelioma and to the development of an effective treatment in the foreseeable future.

The Government cannot protest on the grounds of hypothecation, because the levy under Clause 13 is already hypothecated. They cannot just say that people working on mesothelioma can apply to the Medical Research Council. Of course they can, but the crucial point about the levy is that it would provide funds that will attract scientists to work on that highly intractable problem. The fact that it is intractable is not an excuse. It deserves more attention, it deserves funding, and this group of amendments is one way to make certain that that funding will be made available and that scientists will be attracted to work in this field.

4.30 pm

Lord Selsdon: My Lords, I thought that the death sentence was cancelled many years ago, but I almost seem to have heard my own death sentence now. I worked with asbestos for many years. I picked up Cape blue. Every now and then, when you get a cough in your throat, you think, “Oh, have I caught this disease”—I cannot even pronounce it—“Is there something wrong with me?”. That was during a period in industry. I came out of the Navy, where of course we had masses of asbestos protecting ships, in repairs and elsewhere. I worked with it. It was to some extent a mystical product because it was the only fire protection kit available.

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I then went into industry because of the new developments. These were the new plastics, which were suddenly to replace the whole of the construction industry. I learnt about polyurethane, formaldehyde, polytetrafluoroethylene, poly this, poly that. I would work on the shop floor without a mask, because when you are young you do not have a mask, and when sent out to do roofing materials, lay asbestos cement, cutting and so on, of course we did not wear heavy boots with protective caps; one wanted to be flexible. We did not have safety ladders; we slid down the outside. When I was working on the Blyth Colliery project as a young rep up in the north, I learnt about mining diseases—silicosis and all those things that I could not pronounce.

However, that was another period of time. Now, quite suddenly—and, I think, correctly; I have been impressed by what I have heard today—out of this something has been identified. I have tremendous regard for what the noble Lord, Lord Alton, does, but it is the right thing in the wrong place. This Bill is the right one to go through, and it could have gone through years ago. As I tried to look at the figures, I suddenly realised that I am even more grateful to your Lordships’ House because 50 years ago, when I first came here, I would not have left the asbestos and the plastics world without having to be in your Lordships’ House. I changed my job and went into building and industrial research and I have learnt, over many years, an enormous amount from noble Lords and have great respect for them.

I think that my noble friend Lord Freud and his colleagues have got it right. The question that I ask is: why was this not done a long, long time ago? What is being done about all those other historic diseases that may have come from chemicals of one sort or another? As we have new research developments, those who develop a particular product never think of the future. They do not understand what smells and other things can do. I never wore a mask and now I feel that I am starting to cough a bit, but I have learnt a trick. In your Lordships’ House, when you stand up to speak, many people need a glass of water or need to clear their throat. That may lead them to believe that they have one of these industrial diseases. However, it is strange but there is a little trick that you can do: wiggle your toes. That gets the circulation going and stops you having a dry throat and having to look to the Doorkeepers to ask for water.

I say to the noble Lord, Lord Alton, that I will help in any way that I can to raise money for a research fund and others. I think that the way to approach it is to look at those who may have had great success in property development or things of this sort. Located in their buildings—probably in almost every building in London—are likely to be unacceptable levels of asbestos. However, the levels are not unacceptable until you find it. It may be behind every board. We used to make a product called asbestolux, which was a fire-proofed, simple board used in all homes instead of plywood, which was too expensive at that particular time.

Throughout the land, from our colonies, asbestos, such as the Cape blue asbestos, is virtually everywhere. The danger is, once you try to move it and destroy it,

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you create dust and some of the research has not yet managed to identify how you screen it. Perhaps your Lordships have been in a block where someone is redeveloping a flat and before you know it, in comes an enormous team of people with large fans that suck and circulate. You wonder whether that is taking out some of the micro ingredients that come with asbestos.

Obviously, you will find that in the building trade, people do not necessarily follow what are called “building regs”. Therefore, many accidents have happened with saws and so on that could have been solved. Therefore, to the noble Lord, Lord Alton, and to others, I say: let us just get on with this Bill and get it through. It can do a lot of good as it stands. Do not hold it up and I will see what we might be able to do to encourage some support anywhere else. I am grateful to your Lordships for listening to me and I feel that perhaps I will not fade away quite as early as I thought.

Lord Pannick: My Lords, I have not wiggled my toes but I have added my name to the amendment of the noble Lord, Lord Alton. In his compelling speech, the noble Lord referred to the letter that the Minister sent on Monday. In it the Minister expressed his support for increased research, but he added that,

“unfortunately, the mechanism proposed is just not viable”.

The letter does not provide what we lawyers call further and better particulars as to why the Minister believes that the proposal is not viable; nor did the Minister throw any light whatever on this matter in Grand Committee. Indeed, in his opening remarks this afternoon the Minister very helpfully referred to a number of other matters, but he did not give any explanation in relation to this issue.

In Grand Committee, the Minister focused on a concern that research funding was the responsibility of the Department of Health, while this was a DWP-sponsored Bill. I hope that we will not hear that argument again today. As a matter of law, of course the Government are indivisible, and, as a matter of efficiency, government departments talk to each other. I am encouraged to see the noble Earl, Lord Howe, in his place today.

What other reasons, therefore, could there possibly be for the Minister to suggest that the proposal of the noble Lord, Lord Alton, is not viable? The Government must be satisfied that Clause 13 of their own Bill is viable in providing a levy. These amendments simply provide for a research supplement on this levy, which would be clear as to those who are obliged to pay, the amount and the purpose. Nor can it be that the Minister thinks that these amendments do not reach their target. As the noble Lord, Lord Alton, mentioned, the amendments have been drafted by Daniel Greenberg, a former parliamentary counsel of distinction, who is editor of the authoritative work Craies on Legislation.

Nor could it sensibly be suggested by the Minister that the amendments are not legally viable because they might be the subject of some legal challenge under the Human Rights Act or the European Convention on Human Rights. The Bill contains a levy and there are many other examples of statutory levies introduced by Parliament to advance good causes. The noble Lord, Lord Alton, has given a number of examples;

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I mentioned in Grand Committee the levy on bookmakers under the Betting, Gaming and Lotteries Act 1963 for the purpose of improving horse racing in this country. If, as Ministers must believe, the levy in Clause 13 is legally viable and those other levies are legally viable, I cannot understand why the amended levy of the noble Lord, Lord Alton, is not equally viable. Any legal action to challenge an amended clause—amended in the terms of the noble Lord, Lord Alton—would be a legal action, to coin a phrase, that is not legally viable.

There is a vital need for research and research funding to combat this awful disease. To include these amendments in the legislation would encourage research. I do not accept for a moment the concern expressed by the noble Lord, Lord Selsdon, that for us to do our job and improve the Bill would somehow hold it up. There is ample time for debate on such matters if—I hope it will not be the case—the other place disagrees with us. When it comes to a choice between liability on the insurers and the Minister’s concerns about viability, I am with the noble Lord, Lord Alton.

Lord Howarth of Newport: My Lords, I, like all noble Lords, want to see more research into mesothelioma, above all into ways to prevent people developing this terrible and lethal disease. Noble Lords may be aware that quite recently Russia, leading a group of another six countries —Kazakhstan, Ukraine, Kyrgyzstan, Zimbabwe, India and Vietnam—blocked a move to have white asbestos listed under the UN convention that requires member countries to decide whether or not they should risk importing that substance. I fear that asbestos-related diseases, including mesothelioma, will long remain with us; we will need research for the long term.

I am entirely sympathetic to the purposes of the noble Lord, Lord Alton, his co-signatories to the amendment and the larger number of co-signatories to the letter that they were kind enough to send to us. I congratulate the noble Lord on his dedication in this matter. However, I have some difficulties in accepting the precise proposition of the noble Lord. I have no problem about hypothecating part of the levy for the purpose of research; I accept that precedents are there in the Gambling Act, the Betting, Gaming and Lotteries Act and other measures. I would not presume to take issue with the noble Lord, Lord Pannick, on the question of viability as he has just expounded it. In Committee, I heard noble Lords who are eminent in the fields of medicine and academic research support the case made by the noble Lord, Lord Alton, and I applaud them for that.

However, there is a problem. The insurance industry has told us that it is a willing funder on the basis that the Government will fund the major part of the costs of research. The employer’s liability insurers see themselves as very much the junior partner in that partnership with the state. It was probably not the case with the gambling legislation and the other measures that have been referred to that the Government were expected to more than match the funding that the relevant industry should supply.

These amendments omit to state the implication for government funding of what they would impose on the insurance industry. I wonder why that is so. I can

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imagine that there are good reasons why the amendments do not require the state to commit itself to fund mesothelioma research specifically.

At one time I was Minister for Higher Education and Science; that experience confirmed me in my very strong belief in the arm’s-length system. If we were to abandon that, it would be only a few steps to the relationship between Stalin and Lysenko. The arm’s-length principle is essential for the maintenance of academic freedom and for research quality. Of course, it is legitimate for the Government to take a strategic view and, indeed, for the Department of Health and the National Institute of Health Research to set priorities and make broad allocations. As the noble Lord, Lord Walton of Detchant, told us, when he was a member of the Medical Research Council, the council identified broad priority areas, although it did not think it appropriate to identify individual diseases for which it was determined to fund research. That was because the criterion for making specific awards must be, above all, that of quality. Peer review, not Parliament or the Government, should determine who receives publicly provided funding for research. It follows from that that funding from the state cannot be guaranteed in perpetuity in any particular field of research.

Ample funding has already been provided by the state for which mesothelioma researchers are eligible to bid. The employer’s liability insurers have already provided funds for research and have indicated that they are willing to continue to do so. Therefore, the problem of finding money for research into mesothelioma is not a lack of money on the part of the state or a lack of money forthcoming from the insurers. The problem must be that there has been a lack of high-quality proposals for research in this field. There may have been some quite good proposals; I think that some 80% of bids to the National Institute of Health Research are unsuccessful. Such is the competition for funding from that source that only the very best receive it, so it is not only people who care very strongly about mesothelioma who are disappointed about the lack of funding in any particular field.

Are we to legislate simply to compel the employer’s liability insurers to do what they are already doing and have stated that they are willing to do? If, for good reason, we are not specifying an obligation on the Government, is the Minister none the less proposing to legislate thorough these amendments to place a moral, if not a legal, obligation on the state to fund mesothelioma uniquely, notwithstanding how weak academically particular proposals might be, and notwithstanding the needs that there are for research funding in other fields?

I am left feeling that these amendments, although I completely sympathise with their intention, do not yet articulate a satisfactory position. I think that in a moment the Minister will report to us on his conversations with the noble Earl, Lord Howe, who it is very good to see here listening to this debate, but I suspect that the noble Lord, Lord Alton, ought primarily to be addressing himself to the scientists rather than to the Government.

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4.45 pm

Lord Wigley: My Lords, I support the amendment. I shall address in a moment the points made by the noble Lord, Lord Howarth, but I want to signal my support for Amendment 2 and the associated amendments, which will allow a very small percentage, some 1%, of the levy on active insurers to go towards a supplement for further research into mesothelioma. As we heard from the noble Lord, Lord Alton, a few moments ago, any way of encouraging new people to come into this area of research must be worth while, and that is something that the noble Lord, Lord Howarth, did not address in his remarks. At present the mechanisms are not generating enough research and the research that is currently being undertaken is in danger of being eroded, if not ended. I am also glad that Amendment 24 specifies that the Secretary of State must consult insurers, medical charities and research foundations before making regulations in this respect. I congratulate the noble Lord, Lord Alton, on his perseverance on the matter.

As has been mentioned, in 2011 the British Lung Foundation invested £850,000 in research into mesothelioma, and £400,000 was invested by other charities. In Committee the indications were that it did not appear that much money was coming from the Government. Now, if I understand it correctly, the Medical Research Council has found some rabbits to come out of the hat, and that is all to the good. However, more work clearly needs to be done. If we give due credence to the figures that have been quoted and requoted about the 56,000 people who are in danger of dying from this, if any progress can be made by way of research to reduce the likelihood of those people dying, that is something that we as a House have a duty to undertake. Whether or not this is the appropriate vehicle to do so, it is the vehicle that we have to hand at the moment and we should not lose this opportunity.

The agreement brokered by the British Lung Foundation has meant that over the past three years four large insurance firms have collectively invested £1 million a year into research in this area. I warmly welcome that initiative. It has seen concrete results, as has been mentioned, such as the creation of Europe’s first mesothelioma tissue bank. However, that funding will soon be coming to an end and we need to ensure that the research goes on. The firms that were involved in the initial agreement have indicated that the industry as a whole should be involved in funding future research—that idea comes from them—and that a voluntary agreement would be unworkable. If we are to secure the breakthrough that we need in this area, funding must be made available for research. If that needs legislative underpinning, so be it. Perhaps the Minister can indicate that if the amendment passes, or if he finds another way to reach the same objective when the debate goes on to another place, he will consider including the possibility of a short annual statement on the amount of funding going into mesothelioma research from all sources and the progress that is being made.

Lord Lester of Herne Hill: My Lords, I greatly look forward to the Minister’s reply. I just want to say one sentence. The very first thing I had to do when I came

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to the Bar in 1964 was to act in relation to the Industrial Training Act 1964, which, as I recall, imposed a levy on the building industry in order to subsidise training within the industry, and it worked perfectly well.

The Lord Bishop of Norwich: My Lords, I support this group of amendments and I thank the Minister for his work, which was well illustrated at the beginning of this debate. I knew very little about mesothelioma until I saw its debilitating effects on friends, including the former Bishop of Peterborough, Ian Cundy, who some Members may recall died in 2009. The knowledge that the cause of this cancer has been lurking in one’s body for 20 years or more of active life may suggest in itself that more research into detection and treatment may prove valuable. There is nothing that can be done to rewrite someone’s life history, which may include often unwitting exposure to asbestos while young, but much can be done to promote research into a disease that will kill 2,400 people in the UK this year—the equivalent of wiping out one of Norfolk’s smaller market towns within 12 months. If that sort of tragedy happened it would be front page news but this passes us by too easily.

I am not sure that even now I fully understand why mesothelioma is such a Cinderella of cancer research but this amendment provides a practical way of providing a corrective. The levy proposed is practical and proportionate and it might even stimulate more high-quality researchers to think that this is a worthwhile and reliable area in which to have a sustained work programme over many years. I recognise too that it may even stimulate more voluntary contributions to such research, quite apart from what the Government may give. I also understand that it has some support within the insurance industry. Although I have no expertise in this area, from all that I have read—I am very grateful for the way in which the proposers of this amendment have circulated material to the House—I hope the Minister will look on this proposal or something like it sympathetically.

Baroness Masham of Ilton: My Lords, I congratulate the Minister on his hard work on this Bill and I am pleased he understands what an awful condition mesothelioma is. It seems this condition has almost been written off as far as research is concerned. However, there are so many developments and advances in modern research that there should be research into all types of tragic conditions. There should always be hope. Research into one condition can often find a cure for another by chance. My noble friend Lord Alton of Liverpool explained the need for research so well. I hope your Lordships will support these amendments. It is good to see Ministers from two departments coming together. This is very hopeful. I support these amendments.

Lord Stoneham of Droxford: My Lords, I start by giving apologies from my noble friend Lord German who should be standing in my place today but is at a family funeral. I join in the praise for the two Front-Bench spokesmen for the dedication and commitment they have given to this legislation.

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The amendment is worthy and I have admiration for the persistence of the noble Lord, Lord Alton. However, this is quite an easy target to win support for medical research and we have to question whether it is an effective amendment. All the evidence we have heard today suggests that it is not necessarily the lack of funding that is the problem but the lack of effective research proposals. That is what we should be addressing. If the insurance companies thought there was effective research to be supported, they would be the first to support it because it would reduce their liability. That is what we need to address. The Minister in his response should help us.

The other important thing is that this levy has been arrived at by negotiation and agreement. It is not a statutory levy that we are putting in place because we think that it is appropriate. It has been arrived at through agreement and negotiation. Are we saying that we have to start these negotiations again as we will be putting a supplementary payment on the people who have agreed to this levy? We need to know whether this will mean a serious delay to the legislation and its implementation. The Minister should give us answers to the complications that these amendments could cause. We are interested in getting the benefits into the hands of the families who have suffered from this disease.

We also have to ask what we are arguing over. What are the sums of money that we are arguing over? They do not seem to me to be very large. The Minister should therefore tell us—I am sure that he will in his closing remarks—what efforts the Government are going to make to meet some of the requirements for funding if we can find effective research.

This issue seems worthy and worth support and it is very easy to argue for it. But what is the reality and effect of the amendment and what sort of delay will it cause to this legislation? Those are the key issues that the House should be looking at this afternoon.

Lord Deben: My Lords, the noble Lord, Lord Howarth, made an important contribution to this discussion. As a former Minister, I understand precisely the difficulties in which Ministers find themselves, particularly in the medical area, because there are many diseases that are extremely distressing and which, when specifically singled out, can cause all of us to feel that we ought to do something about it. There are few as distressing as this, but there are others in parallel.

It may be that what the Minister has said so far is the right answer, distressing and difficult though it is, particularly in terms of the danger that arises if we start deciding politically which diseases are properly sought after and which are not; this is a dangerous area to be in. My problem is slightly different. I hope that, in his response, my noble friend the Minister will not rely on the Treasury argument of hypothecation. One of the disastrous themes in this country’s legislation is the refusal of the Treasury to accept that hypothecation is an essential part of sensible financial arrangements. Many things would be much better done if there was a clear connection between what people pay through tax and what happens.

I speak with an interest in mind, as a passionate believer in the environment. We will not get people to understand why they should pay congestion charges,

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for example, if the money is not clearly spent on reducing congestion. In other words, there needs to be hypothecation. I remember when I fought hard for and got the first hypothecated tax, the landfill tax, which few would now deny was very important. My noble friend the Health Minister remembers that as well as I do. It was a battle against a theology. I hope that, when the Minister comes to speak, he will do so in the terms of the noble Lord, Lord Howarth, and not in the terms of those who deny this kind of response—not on the basis of ensuring objective decisions by independent judgment, but on the basis that there is something inherently unacceptable about hypothecation.

If this country moved to greater hypothecation, it would be signally more democratic—although it might mean that the Treasury would have less opportunity to get its fingers on the money on its way to that for which it was needed. That is a wholly admirable aim: the effort to ensure that there is a link in the public’s mind between what they pay and what they get is an essential part of our democracy. I hope that, of all the arguments my noble friend uses, he will eschew that one. I would not like to be pushed over the edge to not support him because of the importance of upholding the fine principle of hypothecation.

5 pm

Lord Empey: My Lords, the debate has been very interesting and, at many times, very moving. There is a general consensus that this is a terrible disease on which no proper research has been carried out. We all want to see that fixed. These amendments represent one attempt to achieve that; perhaps the Minister can direct us towards another mechanism.

The right reverend Prelate said that it was a Cinderella of a disease, and I think the arithmetic explains why. Some 56,000 people in this country are expected to die with it over the next number of years, but it is deemed by many drug companies—I suspect, and perhaps some academics—as a disease of the past. Therefore, what is the point of researching it and spending money when it is dying out, literally? Wrong—this is a disease of the future, not of the past. If somebody takes a moment to search the internet for ship-breaking in Bangladesh, Chittagong and all those places, there are whole generations who have yet to develop this disease because the exposure of those people began only in the mid-1980s. They probably would not even have got to the stage of actually developing the disease.

However, we have a dilemma. As the noble Lord, Lord Howarth, rightly said—I have had some responsibility for this area myself—research is a unique area. It is built up around individual institutions, where academics, particularly postgraduate students, are attracted to pursue research, and there are just not enough of them around. We are delighted to see the noble Earl, Lord Howe, on the Front Bench—I have to say that the concept of a brick wall, the term that the Minister used in Committee, and the noble Earl do not go together. Can the Minister and his colleague advise us whether there is any administrative mechanism that either department could use to encourage people to come forward, such as offering specific sums of money for a particular type of research—in other words, offer a carrot—so that there would be something

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for academics to aim for? Is that one solution? I do not care whether it is through legislation or an administrative mechanism—I do not think any of us do—but there is a general feeling that this has to be fixed.

I come from a city that must be close to being the UK capital—maybe after Liverpool—of this disease because of its industrial past. I do not want to delay the Bill because we have made great progress, the Minister has done a good job and we have had a very welcome announcement today. We want to keep the momentum going but the issue remains unresolved. Something must be done, be it through legislation, administrative mechanisms or all government departments working together to encourage the research councils. Has the Minister had a negative response from the insurance companies or any other source to this proposal? Are they threatening that if this were to happen, it may cast a shadow on the whole scheme? I think the House would very much welcome his response. Perhaps, in his winding-up remarks, the Minister could tell us. None of us wants to delay things. I do not think that there is an appetite for any particular scheme, but we want a solution. If the Government can bring it about by another mechanism, I think we would all be pleased.

Lord Kerr of Kinlochard: I had not intended to speak but I am moved to do so by the austere and Robespierre-like logic of the noble Lord, Lord Howarth. He was supported by the noble Lord, Lord Deben, who I strongly agree with in his advice to the Minister to eschew the hypothecation arguments. My advice would be to also eschew the Robespierre argument advanced by the noble Lord, Lord Howarth. The Minister is actually in such a good mood today that I rather hope he is going to accept this amendment.

I do not think that the noble Lord, Lord Howarth, is right. From my passing experience of being involved with and watching the noble Lord, Lord Tugendhat, who I see is in his place, playing a principal part in a university medical research programme, medical research does not seem to have any difficulty in accommodating well placed money from foundations, trusts, charities or private philanthropy. I do not see why a levy should be any different and I reject the reference to Stalin. It seems that this levy could go direct, but if the research councils need to be involved in this at all, it does not follow that the awards displaced would necessarily have been of higher quality.

I do not accept that the purity of the system is affected if money comes in from other streams. Universities seem to have managed to cope with that very well over the years, so we do not need to follow such an austere argument as that of the noble Lord, Lord Howarth. Although I accept that there is a worrying logic to it, in practice it does not work like that.

Lord McKenzie of Luton: My Lords, this has been a wide-ranging debate. I do not think I will be drawn into issues of hypothecation, although it is a tempting subject for debate. Throughout our deliberations on the Bill and before, the noble Lord, Lord Alton, has been passionate and convincing about the case for funding mesothelioma research. He has been supported in this by many noble Lords, including those who have added their names to his amendments, particularly the noble Lords, Lord Walton and Lord Pannick.

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The case that the noble Lord makes is thorough and incontestable. Despite knowledge of this terrible disease and its long latency over many decades, research spending by Governments has been derisory. The noble Lord contrasted the levels of research on diffuse mesothelioma with other cancers to reinforce his point but he acknowledges, as does the noble Lord, Lord Walton—and as indeed do we—that the insurance industry has funded such research in the past. The ABI has made it clear to us in discussion that it stands ready to do so again in the future, if the Government are prepared to play their part. They had said that they would match-fund. I hope that we will hear from the Minister in a moment that the Government will play their part, and how they will do so.

We all recognise that the noble Lord, Lord Alton, has made his case about the need for a national research effort, so the issue is not whether but how this outcome is to be achieved. His approach is focused on the insurance industry’s contribution, which, as he explained, is set down by Amendment 24 as a “Research supplement” raised under regulations under the levy provisions. That supplement could not exceed 1% of that required for payments under the scheme. The proposed regulations must cover how such amounts are to be applied and the role of the scheme administrator. Of itself, the amendment makes no reference to the Government’s obligations. I think that we will hear a different approach from the Minister about the plans that he would wish to develop to attract quality research funding for mesothelioma. If this is right, we need to understand the parameters of this: how much is involved and what is expected of the insurance industry. We also need to understand whether the approach is inconsistent with that of the noble Lord, Lord Alton, which is to raise a levy on insurers.

We have thought long and hard about this and which is the best way forward. Our shared objective is, I believe, to get properly funded research under way as quickly as possible and on a sustainable basis. We all acknowledge the commitment and integrity of the Minister and his desire to fulfil this objective. After hearing the Minister again, the noble Lord, Lord Alton, may consider that he has sufficient reassurance that his objectives will be met, albeit by the administrative route rather than the legislative one. Perhaps he has already concluded that from the extensive discussions he has had to date. If the noble Lord, Lord Alton, is not reassured, and presses his amendment, we are minded to support him in the Lobby.

The Parliamentary Under-Secretary of State, Department of Health (Earl Howe): My Lords, it may be a slight surprise to see a Minister from another Department of State responding to this amendment. However, my noble friend Lord Freud has asked me to speak to it as a reflection of the importance that he and I place on promoting research into mesothelioma. We are both sympathetic to the view that more money should be put into research on this disease. Indeed, before this amendment was tabled, my noble friend and I spent some time exploring possible routes for funding. It is the fruits of those discussions that I shall now cover. However, the mechanism proposed in this amendment is not the best way to achieve the objective that the noble Lord, Lord Alton, is aiming at.

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There are a number of reasons for this. In Committee, my noble friend set out some technical but none the less important arguments as to why the Government are resistant to the idea of a supplementary levy for mesothelioma research. I will not rehearse those arguments again and my noble friend Lord Deben need not worry as I am not going to rely on them at all. I need to stress that any additional research charge of the kind proposed by the noble Lord, Lord Alton, would, like all taxation, have to be paid into the Consolidated Fund and, if hypothecated, would then have to be paid out by the Treasury for a specific purpose. The Treasury does not normally handle tax income in this way, and there would need to be more convincing arguments before it could consider doing so for mesothelioma research.

The more substantive problem with the amendment is to do with research policy. As noble Lords will be aware—and the noble Lord, Lord Howarth, pointed to this—there is a fundamental, widely accepted principle that the use of medical research funds should be determined not just by the importance of the topic but by the quality of the research and its value for money. There is a good reason for this. There will always be more proposals for high-quality medical research overall than there are resources available for funding, and it is arguably unethical to support second-rate work in a particular area at the expense of higher-quality work in another equally important one. Noble Lords will understand that this is why, as a rule, public sector funders of research do not ring-fence funds for particular diseases. It was the same principle that prompted Dame Sally Davies to restructure the research funding that the Department of Health was putting into the NHS over many years, so that funds would flow, as they now do, to the most important, highest-quality research.

In the case of mesothelioma, the real issue is not just the money; it is the quality of the research being proposed. How can we try to ensure that the research proposals in this field reach the quality threshold required to secure funding? If that threshold is reached, funding is much less of a difficulty; indeed there is no need to think about the forcible gathering of funds from insurers. If noble Lords agree, the goal is how we stimulate high-quality research proposals without undermining the country’s strategic research mechanisms.

Lord Kerr of Kinlochard: We have heard from Robespierre. I hope we are not now hearing from Danton. Will the Minister accept that most foundation, trust, charity or philanthropic money for medical research is earmarked for particular diseases or research topics? What is the difference between that and a levy from the industry for this disease?

5.15 pm

Earl Howe: My Lords, I accept that fully and I will come to that point in a second.

Certainly there was a blockage in the research process, but it was not total. There is good news. As the noble Lord, Lord Alton, informed us, spending on mesothelioma research is not as low as noble Lords might believe from the discussions in Committee. The latest figures

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from the Medical Research Council show that its annual spend on mesothelioma research rose from £0.8 million in 2009-10 to £2.4 million in 2011-12. We should not belittle those figures. That is in addition to the research supported by the £1 million a year donated by insurance companies to the British Lung Foundation, and research supported by the National Institute for Health Research. Therefore, on the ability of the system to support publicly funded mesothelioma research, we are not knocking at a closed door.

My noble friend Lord Stoneham is right that the issue that is holding back progress on research into mesothelioma is not lack of funding but the lack of sufficient high-quality research applications. This is an issue that we in the Department of Health, working with the National Institute for Health Research, have been seeking to address. I will now set out what we propose. There are four elements to it.

First, the National Institute for Health Research will ask the James Lind Alliance to establish one of its priority-setting partnerships. This will bring together patients, carers and clinicians to identify and prioritise unanswered questions about treatment for mesothelioma and related diseases. It will help target future research, and, incidentally, will be another good example of where patients, the public and professionals are brought into the decision-making process on health.

Secondly, the National Institute for Health Research will issue what is called a highlight notice to the research community, indicating its interest in encouraging applications for research funding into mesothelioma and related diseases. This would do exactly what the noble Lord, Lord Alton, wants, and what the noble Lord, Lord Empey, suggested. It would make mesothelioma a priority area.

Thirdly, the highlight notice would be accompanied by an offer to potential applicants to make use of the NIHR’s research design service, which helps prospective applicants to develop competitive research proposals. Good applications will succeed.

Finally, the NIHR is currently in discussion with the MRC and Cancer Research UK about convening a meeting to bring together researchers to develop new research proposals in this area. The aim is for the event to act as a catalyst for new ideas that will further boost research into mesothelioma. I was very interested in what the noble Lord, Lord McKenzie, told us about the offer of matched funding from the ABI. I look forward to hearing more about that.

As my noble friend Lord Freud mentioned, on 25 July in the Palace of Westminster precincts, he and I will co-host an event run by the British Lung Foundation that will focus on mesothelioma. I will take this opportunity to invite noble Lords to join us to hear about current research and to get a family perspective on the disease.

The four steps that I have set out offer a better and much more realistic way of achieving what we all want to see happen. The problem with the remedy that the noble Lord proposed is that it will not of itself deliver that objective. I could sum up the issue by saying that the availability of funds does not guarantee the spending of funds. Nor does it guarantee the quality of research on which such funds would be spent. It is also worth

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making the point that it would create a precedent that might encourage other and perhaps less deserving interest groups to seek special treatment for a disease about which they care passionately.

I hope the noble Lord will recognise that his amendment has galvanised the Government into action. He can credit himself with having achieved a valuable outcome by tabling it. I hope that he will consider not pressing it. I have given undertakings today that I will be keen to take forward with him and with all relevant stakeholders.

Lord Wigley: May I ask the noble Earl to respond to my earlier question on whether, in the context of the four proposals that he has brought forward, there might be a mechanism for some form of annual report on the progress of mesothelioma research so that we do not lose focus on this important issue?

Earl Howe: I think that there is scope for that, whether it is a stand-alone report or is built automatically into the report that is produced by the department or the MRC. I would be happy to take that idea forward.

Lord Walton of Detchant: Before the Minister sits down and before my noble friend responds, perhaps I may ask the Minister this question. Let us suppose that, in the light of the developments and proposals that he has outlined, the insurance industry—the ABI—decides, in the goodness of its heart and bearing in mind the importance of this problem, that it wishes to make an ongoing and regular contribution to research in this field. Would the National Institute for Health Research be precluded from accepting non-government funds or would such funding have to be channelled, for example, through the cancer research campaign?

Earl Howe: A very great deal of the research conducted in this country is funded by different sources. It is funded by the Government, charities, universities, and industry. Nothing in the arrangements that I have outlined precludes a joint arrangement for funding mesothelioma research, which is why I welcomed the indication that the noble Lord, Lord McKenzie, gave about the ABI and the possibility of augmenting whatever funds are forthcoming from the MRC or the NIHR. That is an important point to make. I think I have said enough. The ball is in the noble Lord’s court.

Lord Alton of Liverpool: My Lords, I am always grateful to the noble Earl and I know that the House will appreciate what he has said about the four steps that he intends to take. I think he would agree, though, that there is nothing incompatible in taking those very welcome steps and supporting the spirit of this amendment. I made it clear when I spoke at Second Reading, in Committee and again today that if the Government—during the many discussions that the noble Lord, Lord Freud, and I have had about this—had been willing to accept the principle and come forward with their own amendment, I would have been happy to withdraw my own. The principle that I have been trying to underline is the need for a statutory requirement to step up to the plate to deal with this killer disease, which we all agree will take any number of lives—an estimated 56,000 before the disease completes its first

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wave. We heard in the quotations I presented to the House earlier today that there is a possibility that, in the BRIC countries and with new forms of asbestos being used worldwide, it will not be 56,000 who die, but many more.

The noble Earl has suggested that if such a levy were imposed, it would be swallowed up into Treasury funds and there would be no guarantee that it would then be used for its intended purpose. I do not think that any of us really believe that that would be possible. If Parliament has legislated that a levy of up to 1% should be imposed—that is all; it is a levy inside a levy and what this entire Bill is about—there is no reason why that money should not then be used for this specific purpose. The noble Lord has already said that this should be a priority area.

The noble Earl has said that there should be competitive research proposals; very good research proposals have been put forward but, unfortunately, have not gained traction because the funding has not been available for them. It has been a Catch-22 situation. It was also said that it would be unethical to support second-rate work. Nobody in your Lordships’ House would suggest otherwise—of course we accept that there should be no second-rate work and, through the Medical Research Council and specified outside bodies, an evaluation would be made of the quality of that work and of the proposals that have been put forward.

The noble Earl said that around £2 million will now be made available, and that is welcome. However, the House should just bear in mind, for example, the £22 million being made available this year for bowel cancer, the £41 million for breast cancer, the £11.5 million for lung cancer and the £32 million for leukaemia. Those comparisons show the position in which mesothelioma still appears in this terrible league table.

The noble Earl also said, quite rightly—and the noble Lord, Lord Howarth, touched on this, too—that we should protect the purity of the system, but my noble friend Lord Kerr of Kinlochard dealt admirably with that argument and I can add nothing more to what he said. No one wishes to pollute the process but the Bill before the House is about one specific disease, and that is why this amendment is before your Lordships. It is not that we are being asked to set a precedent for any number of other things. Mesothelioma has a unique characteristic. The reason that the noble Lord has been able to negotiate with the ABI and the industry is that, for instance, smoking cigarettes cannot lead to mesothelioma. This disease is specific and that is why the industry has accepted its responsibilities in this regard. Therefore, it is different from other diseases, and that is why we were able not only to have this Bill but to exclude from it even other asbestos-related diseases, which cannot be said to be specific, as mesothelioma is. I think that that is a perfectly good reason for attaching to the Bill an amendment that deals specifically with this disease.

I am extremely grateful to everyone who has participated in this debate. I am sure that we listened with great care to my noble friend Lord Walton of Detchant, who said that this could make a massive contribution and that it could pave the way for a cure. The noble Lord, Lord Selsdon, was right when he

17 July 2013 : Column 789

asked why it was not done a long time ago. As long ago as 1965, the

Sunday Times

reported on work that had been done by the London School of Hygiene and Tropical Medicine. In cities such as Belfast, Liverpool, Glasgow and other epicentres of the disease, it had identified the nature of mesothelioma, as well as its very long hibernation period, alluded to by the right reverend Prelate the Bishop of Norwich, before it had its terrible impact.

I doubt that there are many of your Lordships who have not come across people who have contracted this disease and died within the two years—that is all it takes—from the time that it is diagnosed until death. The right reverend Prelate referred to the late Bishop of Peterborough. When we dealt with the LASPO legislation last year, the noble Lord, Lord McNally, told a deeply moving story at the Dispatch Box about his sister, who had died as a result of washing the dungarees and overalls of her husband, who had worked in the industry. This is something that can affect us all and we need to do something about it urgently.

The noble Lord, Lord Pannick, said that it might be claimed that the amendment is not viable. That has not been said in the debate today, yet it was said in the letter that was distributed on Monday. The amendment deliberately mimics Clause 13 of the Bill so that it does nothing that the Bill itself is not doing. It cannot possibly be challenged under the Human Rights Act, but perhaps we could be challenged under that Act by victims of mesothelioma if we fail to do enough or take the opportunity to provide for proper research to deal with this disease.

The noble Lord, Lord Wigley, said that the mechanisms that we have at the moment are not generating the research but he said that this vehicle is at hand. There is no reason at all why this should delay the legislation. As I told your Lordships in my opening remarks, I met with the ABI. The industry had expressed no opposition; indeed, it has been generous in providing what funds there have been in the past towards dealing with this disease. Therefore, there is already a precedent here. I am certain that if the Government were to say that they would make available matching money, even more funds would be made available by the industry. The noble Lord, Lord Howarth, touched on that point, and rightly so. Yes, there is a moral obligation. Because of the privileges issue, it would not be appropriate to include that here, but there is no reason why it could not be attended to in another place and there is no reason at all why this should become a matter for ping-pong.

The mortality rate for most cancers is falling while it continues to rise for mesothelioma. There are humane and altruistic reasons for supporting funding for mesothelioma research, but for the Government and the insurance industry there are straightforward financial considerations, too. It would be impossible to eradicate all asbestos from our homes, schools, hospitals, factories and offices.

The Bill represents a genuine desire to act justly to those who have been afflicted with mesothelioma, which is why I have supported the noble Lord, Lord Freud, throughout in placing the Bill before the House. However,

17 July 2013 : Column 790

the one certain way to prevent deaths from mesothelioma will be to find a cure. That will not happen without adequate resources and that in turn requires political will. That is why I thank all those who have spoken today in the debate and who have supported the amendment. I would like to test the will of the House.

5.30 pm

Earl Howe: Before the noble Lord finally decides what to do with his amendment, may I just explain why the Government have not brought forward their own amendment, which was one of his criticisms? We do not believe that a legislative route is necessary. We believe—as the noble Lord, Lord Empey, indicated—that we can do this in other ways. We can give the process exactly the kind of kick-start that was referred to in the debate much more effectively than can this amendment. Funders for research build areas for research by bringing researchers and clinicians together, not by throwing money at a problem, which is, I am afraid, what this amendment would do.

Lord Alton of Liverpool: My Lords, this is not about throwing money at problems. That is certainly something that I have always eschewed throughout the whole of my time in politics. You have to demonstrate the case and there is a case here. If 56,000 of our countrymen are going to die of this disease over the next 30 years or so, we have to find adequate resources to tackle mesothelioma. That is not being done by this Bill. We have a rare opportunity to do something about it.

Lord Walton of Detchant: Before my noble friend sits down and eventually decides what action he proposes to take, I wish to ask him whether he feels that the important developments referred to by the noble Earl, Lord Howe, relating to forthcoming meetings between the Medical Research Council, the NIHR and other organisations, might not—at the moment—be a useful way forward?

Lord Alton of Liverpool: I am grateful to my noble friend and yes, of course I am delighted that those meetings are going to happen. The noble Earl was kind enough to say that perhaps the debates that have been precipitated on this issue in Committee, at Second Reading and again today have helped to bring that about. However, the moment will pass and all of us who sit in this House know that once the legislative vehicle has moved on, the opportunity to make something happen disappears into the ether. That is why I intend to press this to a vote and to test the will of your Lordships’ House.

5.32 pm

Division on Amendment 2

Contents 192; Not-Contents 199.

Amendment 2 disagreed.

Division No.  1


Aberdare, L.

Adams of Craigielea, B.

Adonis, L.

Alli, L.

Alton of Liverpool, L.

Anderson of Swansea, L.

Andrews, B.

Armstrong of Hill Top, B.

17 July 2013 : Column 791

Avebury, L.

Bach, L.

Barnett, L.

Bassam of Brighton, L. [Teller]

Beecham, L.

Bichard, L.

Bilston, L.

Boateng, L.

Boothroyd, B.

Brennan, L.

Brooke of Alverthorpe, L.

Brookman, L.

Browne of Belmont, L.

Browne of Ladyton, L.

Campbell-Savours, L.

Carlile of Berriew, L.

Chandos, V.

Christopher, L.

Clark of Windermere, L.

Clarke of Hampstead, L.

Clinton-Davis, L.

Cohen of Pimlico, B.

Collins of Highbury, L.

Craig of Radley, L.

Crawley, B.

Cunningham of Felling, L.

Curry of Kirkharle, L.

Davies of Coity, L.

Davies of Oldham, L.

Davies of Stamford, L.

Desai, L.

Donaghy, B.

Donoughue, L.

Doocey, B.

Drake, B.

Dubs, L.

Eames, L.

Elder, L.

Elystan-Morgan, L.

Evans of Parkside, L.

Evans of Temple Guiting, L.

Farrington of Ribbleton, B.

Faulkner of Worcester, L.

Fellowes, L.

Finlay of Llandaff, B.

Foulkes of Cumnock, L.

Gale, B.

Gibson of Market Rasen, B.

Giddens, L.

Glasman, L.

Gordon of Strathblane, L.

Gould of Potternewton, B.

Grantchester, L.

Grenfell, L.

Grocott, L.

Hameed, L.

Hanworth, V.

Harries of Pentregarth, L.

Harris of Haringey, L.

Harrison, L.

Haskel, L.

Hastings of Scarisbrick, L.

Haworth, L.

Hayman, B.

Hayter of Kentish Town, B.

Healy of Primrose Hill, B.

Henig, B.

Hilton of Eggardon, B.

Hollick, L.

Hollis of Heigham, B.

Howells of St Davids, B.

Hoyle, L.

Hughes of Stretford, B.

Hughes of Woodside, L.

Hunt of Chesterton, L.

Hylton, L.

Jones of Whitchurch, B.

Jones, L.

Judd, L.

Kennedy of Southwark, L.

Kennedy of The Shaws, B.

Kerr of Kinlochard, L.

Kilclooney, L.

King of Bow, B.

Kinnock of Holyhead, B.

Kinnock, L.

Kirkhill, L.

Knight of Weymouth, L.

Lea of Crondall, L.

Leitch, L.

Liddell of Coatdyke, B.

Liddle, L.

Linklater of Butterstone, B.

Lipsey, L.

Lister of Burtersett, B.

Low of Dalston, L.

Luce, L.

Lytton, E.

McAvoy, L.

McConnell of Glenscorrodale, L.

McDonagh, B.

McFall of Alcluith, L.

McIntosh of Hudnall, B.

MacKenzie of Culkein, L.

McKenzie of Luton, L.

Mandelson, L.

Masham of Ilton, B.

Massey of Darwen, B.

Maxton, L.

Miller of Chilthorne Domer, B.

Monks, L.

Moonie, L.

Morgan of Huyton, B.

Morris of Yardley, B.

Morrow, L.

Neuberger, B.

Noon, L.

Norwich, Bp.

Nye, B.

O'Neill of Bengarve, B.

Ouseley, L.

Palmer, L.

Pannick, L.

Patel of Blackburn, L.

Patel of Bradford, L.

Pitkeathley, B.

Ponsonby of Shulbrede, L.

Prescott, L.

Prosser, B.

Puttnam, L.

Quin, B.

Radice, L.

Ramsay of Cartvale, B.

Rea, L.

Rendell of Babergh, B.

Richard, L.

Rooker, L.

Rosser, L.

Rowe-Beddoe, L.

Rowlands, L.

Royall of Blaisdon, B.

Sandwich, E.

Sawyer, L.

Scotland of Asthal, B.

Scott of Foscote, L.

Sherlock, B.

Simon, V.

Slim, V.

Smith of Basildon, B.

Smith of Finsbury, L.

Snape, L.

Soley, L.

Steel of Aikwood, L.

17 July 2013 : Column 792

Stevenson of Balmacara, L.

Stoddart of Swindon, L.

Stone of Blackheath, L.

Taylor of Blackburn, L.

Taylor of Bolton, B.

Temple-Morris, L.

Thornton, B.

Touhig, L.

Trees, L.

Tugendhat, L.

Tunnicliffe, L. [Teller]

Turner of Camden, B.

Uddin, B.

Wall of New Barnet, B.

Walpole, L.

Warner, L.

Warwick of Undercliffe, B.

Watson of Invergowrie, L.

West of Spithead, L.

Wheeler, B.

Whitaker, B.

Whitty, L.

Wigley, L.

Wilkins, B.

Williamson of Horton, L.

Wills, L.

Wood of Anfield, L.

Woolmer of Leeds, L.

Worthington, B.

Young of Norwood Green, L.

Young of Old Scone, B.


Addington, L.

Ahmad of Wimbledon, L.

Alderdice, L.

Allan of Hallam, L.

Anelay of St Johns, B. [Teller]

Ashdown of Norton-sub-Hamdon, L.

Ashton of Hyde, L.

Astor of Hever, L.

Attlee, E.

Bates, L.

Berkeley of Knighton, L.

Berridge, B.

Bew, L.

Bilimoria, L.

Black of Brentwood, L.

Blencathra, L.

Bowness, L.

Brabazon of Tara, L.

Bradshaw, L.

Bridgeman, V.

Brinton, B.

Brooke of Sutton Mandeville, L.

Brougham and Vaux, L.

Browning, B.

Burnett, L.

Byford, B.

Caithness, E.

Cathcart, E.

Chadlington, L.

Chalker of Wallasey, B.

Chidgey, L.

Clancarty, E.

Colwyn, L.

Cope of Berkeley, L.

Cotter, L.

Courtown, E.

Coussins, B.

Craigavon, V.

Crathorne, L.

Crickhowell, L.

De Mauley, L.

Deben, L.

Deighton, L.

Dholakia, L.

Dixon-Smith, L.

Dobbs, L.

Dykes, L.

Eaton, B.

Edmiston, L.

Elton, L.

Erroll, E.

Faulks, L.

Fellowes of West Stafford, L.

Forsyth of Drumlean, L.

Fowler, L.

Framlingham, L.

Freeman, L.

Freud, L.

Garden of Frognal, B.

Gardiner of Kimble, L.

Gardner of Parkes, B.

Garel-Jones, L.

Geddes, L.

Glasgow, E.

Glendonbrook, L.

Glentoran, L.

Goodhart, L.

Goodlad, L.

Goschen, V.

Grade of Yarmouth, L.

Greaves, L.

Greenway, L.

Hamwee, B.

Hanham, B.

Harris of Richmond, B.

Henley, L.

Heyhoe Flint, B.

Higgins, L.

Hill of Oareford, L.

Hodgson of Astley Abbotts, L.

Hooper, B.

Howarth of Breckland, B.

Howe of Aberavon, L.

Howe of Idlicote, B.

Howe, E.

Hunt of Wirral, L.

Hussain, L.

Inglewood, L.

James of Blackheath, L.

Jay of Ewelme, L.

Jenkin of Kennington, B.

Jenkin of Roding, L.

Jolly, B.

Jones of Cheltenham, L.

Jopling, L.

Kakkar, L.

King of Bridgwater, L.

Kirkwood of Kirkhope, L.

Kramer, B.

Laming, L.

Lamont of Lerwick, L.

Lawson of Blaby, L.

Lee of Trafford, L.

Lester of Herne Hill, L.

Lexden, L.

Lindsay, E.

Lingfield, L.

Loomba, L.

Lyell, L.

MacGregor of Pulham Market, L.

MacLaurin of Knebworth, L.

McNally, L.

Maddock, B.

Mar, C.

17 July 2013 : Column 793

Marland, L.

Marlesford, L.

Mayhew of Twysden, L.

Meacher, B.

Montgomery of Alamein, V.

Montrose, D.

Moore of Lower Marsh, L.

Morris of Bolton, B.

Naseby, L.

Nash, L.

Neville-Jones, B.

Newby, L. [Teller]

Newlove, B.

Northover, B.

Norton of Louth, L.

O'Cathain, B.

Oppenheim-Barnes, B.

Palmer of Childs Hill, L.

Parkinson, L.

Parminter, B.

Patel, L.

Patten, L.

Perry of Southwark, B.

Popat, L.

Randerson, B.

Rawlings, B.

Razzall, L.

Rennard, L.

Ridley, V.

Risby, L.

Roberts of Llandudno, L.

Rodgers of Quarry Bank, L.

Rogan, L.

Roper, L.

Sassoon, L.

Seccombe, B.

Selborne, E.

Selkirk of Douglas, L.

Selsdon, L.

Shackleton of Belgravia, B.

Sharkey, L.

Sharp of Guildford, B.

Sharples, B.

Shaw of Northstead, L.

Sheikh, L.

Shephard of Northwold, B.

Shipley, L.

Shutt of Greetland, L.

Skelmersdale, L.

Smith of Clifton, L.

Spicer, L.

Stedman-Scott, B.

Stephen, L.

Stern, B.

Stewartby, L.

Stoneham of Droxford, L.

Storey, L.

Stowell of Beeston, B.

Strasburger, L.

Strathclyde, L.

Sutherland of Houndwood, L.

Taverne, L.

Taylor of Goss Moor, L.

Taylor of Holbeach, L.

Taylor of Warwick, L.

Tebbit, L.

Thomas of Gresford, L.

Thomas of Swynnerton, L.

Thomas of Winchester, B.

Tope, L.

Trimble, L.

True, L.

Tyler of Enfield, B.

Tyler, L.

Ullswater, V.

Verma, B.

Wallace of Saltaire, L.

Wallace of Tankerness, L.

Walmsley, B.

Warnock, B.

Warsi, B.

Wasserman, L.

Wheatcroft, B.

Wilcox, B.

Younger of Leckie, V.

5.44 pm

Amendment 3

Moved by Lord Freud

3: Clause 1, page 1, line 7, leave out subsections (2) and (3)

Amendment 3 agreed.

Clause 2 : Eligible people with diffuse mesothelioma

Amendment 4

Moved by Lord McKenzie of Luton

4: Clause 2, page 1, line 17, leave out “25 July 2012” and insert “10 February 2010”

Lord McKenzie of Luton: My Lords, the amendment stands in my name and that of my noble friend Lady Sherlock. I shall also speak to Amendment 8. The two amendments are linked, and we see Amendment 8 as being consequential.

The amendment addresses one of the major bones of contention with the legislation: its start date. The payment scheme, which we all applaud, is applicable only to those first diagnosed with diffuse mesothelioma on or after 25 July 2012. This is, as we know, the date when the Government responded to the consultation

17 July 2013 : Column 794

published by the previous Government. It was more than two years after the consultation closed. Over that period, some 600 individuals will have died from diffuse mesothelioma without them or their dependants receiving proper compensation.

We were told in Committee that it took so long to move from consultation to response because of the complexity of the issues and the intense work with stakeholders, including the insurance industry. We accept this, but it can hardly then be argued that the insurance industry did not know what was coming. It would surely have been on notice as to the likely parameters of the scheme, because it was a key participant in the negotiation, which in effect required some degree of agreement. It is not as though the scheme was somehow sprung on the industry from out of the blue.

We had some debate in Committee about the date on which insurers could reserve against liabilities. As my noble friend Lady Sherlock exposed in her usual forensic analysis, it is not a matter of reserving against liabilities. The levy is apparently a tax and should be provided for in the usual way when it arises.

It has been suggested that the February 2010 date, the date on which the consultation document was issued, was insufficient notice to create the expectation of the introduction of a scheme that would have to be funded by the insurance industry. We disagree. It is an entirely appropriate start date. Paragraph 60 of the document states clearly:

“Having considered this carefully, the Government are persuaded that an ELIB”—

an employer liability insurance bureau—

“should form part of the package of measures to improve the lives of those who, for whatever reason and through no fault of their own, have been injured or made ill”,

by work.

That was clearly putting people on notice that the then Government were intent on introducing an ELIB broadly on the terms of the Motor Insurers’ Bureau. Moreover, this intent was not limited to a scheme to cover diffuse mesothelioma; it was a broader intent to cover those more generally who were missing out on justifiable compensation. Although a very valuable scheme, what is now provided for in the capital is a smaller, less costly scheme than was signalled in the February 2010 consultation. It should have been no surprise for insurers. The arguments in favour of a July 2012 commencement are flimsy to say the least. In its briefing for today, the Law Society states: “There is little justification for disqualifying cases diagnosed between the announcement of the consultation in February 2010 and July 2012”.

Of course, the Minister will tell us that there is greater cost, that it could tip all this finely balanced negotiation over the edge, and that co-operation from insurers would recede, but the cost originally presented to us for a February 2010 start date was an extra £190 million. It is now transpired that that assumes payment at 100% and presumably took no account of any additional compensation recovery that might ensue and assist with smoothing. It would be dependants rather than sufferers who would mostly benefit from this, because many of the latter would, sadly, not have survived, but that is no reason to deny justice. I beg to move.

17 July 2013 : Column 795

Lord Howarth of Newport: My Lords, the common theme of the amendments in this group is that they increase eligibility with a view to increasing justice. I add my personal thanks to the noble Lord, Lord Freud, for all his personal commitment to achieving just outcomes through the legislation, and I hope that he will be willing to contemplate the amendments that I have added to this group.

First, I entirely support my noble friends Lord McKenzie of Luton and Lady Sherlock in their amendments which would bring forward the start date for eligibility to 10 February 2010. Amendment 5 in my name would extend eligibility to a person diagnosed with diffuse mesothelioma who was self-employed at the time of exposure to asbestos. Amendment 6 would extend eligibility to a person who is a member of the same household as a person exposed to asbestos in the course of their work.

The employers’ liability insurers have bluntly and, I feel, rather brutally, expressed their view that the self- employed should not be eligible. As they have explained to us:

“As employers’ liability insurers will be funding the untraced scheme, payments from the scheme will only be made to those who would have been covered by employers’ liability insurance”.

The ABI has, however, made one small, decent concession, saying that under the untraced scheme, if someone has been negligently exposed during employment and self-employment but is unable to find an employer or insurer to claim against, they will be able to receive a payment from the untraced scheme without a deduction for the period they were self-employed.

In Committee, my noble friends Lord Browne, Lord Wigley and Lord McKenzie explained that on the kind of industrial and construction sites where people were negligently exposed to mesothelioma, there was frequently no real distinction between employed and self-employed status. In many cases, it may have suited employers to classify people as self-employed who were, to all intents and purposes, employed. Indeed, in Committee the noble Lord, Lord Freud, himself accepted that,

“some people will appear to be self-employed where the reality is that that was an artificial, tax-driven construct. In that case, if they can demonstrate that in practice they were acting like an employee, they would be eligible for a payment under the scheme.”.—[

Official Report

, 5/6/13; col. GC 220-221.]

I am very grateful for what the noble Lord said then, but we need to go a bit further. We need to ensure that everyone, whether they were nominally, technically or otherwise self-employed, is covered and is eligible to receive payments from the scheme.

What is the position of those who were genuinely self-employed, did insure, but whose documentation has gone missing? Should they not be included? The ABI itself admits:

“There will only be a very small category of people who have been solely self-employed and therefore not eligible for a payment from the untraced scheme”.

The Minister undertook to ask the ABI for its figures, but unfortunately, he then had to write to us to say that it did not have any reliable figures. What is clear, by the ABI’s own admittance, is that the numbers are very small.

17 July 2013 : Column 796

The suffering of self-employed people who contracted diffuse mesothelioma, and the suffering of their dependants, is no less than the suffering of people who were employed in the technical sense. I believe that it would be wrong for us to abandon them, and I believe that it would cost very little by way of an addition to the levy, to embrace them in the scheme.

In Committee there was extensive concern expressed by noble Lords on all sides about the predicament of members of the household of someone who had been exposed to asbestos in the workplace, who were diagnosed with mesothelioma, when the person who was actually employed had not been diagnosed. Indeed, a household member might have predeceased an employee who has not, or not yet, been diagnosed. The noble Lord, Lord Alton, reminded us of one particular instance, movingly described to us in our proceedings on other legislation, of the sister of the noble Lord, Lord McNally. Other noble Lords in Committee were aware of individual cases where this had happened. In particular, the most frequent instances were when a wife, or perhaps a daughter, was regularly doing the laundry and washing the contaminated overalls.

In writing to us, the noble Lord, Lord Freud, gave us an estimate that an average of 214 cases of mesothelioma would be caused by environmental exposure in the years 2014-24. I take it that that is a wider category that would include household members; indeed, the friend of the noble Lord, Lord Walton of Detchant, the consultant neurologist who died, might have been included. We are talking of a significant, though not a huge, group of people. Is it right to abandon them on the technicality that they were not themselves employees?

The term “secondary exposure” was used in Committee, but I think we are really talking about the direct effect of employers’ negligence. It is the same lethal fibres in the same workplace that will have caused the disease to hit a person, whether self-employed or a household member in the circumstances I have described. Surely it was through employers’ negligence that employees were allowed to come home wearing their contaminated workwear; they should not have done so. On this, the ABI has been silent. Perhaps even it cannot contrive presentable reasons as to why it should not pay out of a scheme which, after all, is not based on precise legal liability.

This scheme deals with the situation of claimants who, by definition, cannot avail themselves of their legal rights. I do not think that the employers’ liability insurers ought to hide behind legal technicalities. If, however, the employers’ liability insurers are adamant, and if the Minister remains reluctant to compel them, then I hope that he will consider levying the public liability insurers. He was as good as his word; he discussed the question of public liability insurance in this context with the Association of Personal Injury Lawyers and with the ABI. He wrote to us following that discussion to say that, in the main, it would be the public liability policy that would apply when the affected person was not directly employed by the liable employer. In many cases, I think it is the same insurer.

I have not tabled an amendment relating to public liability insurance because, as I take it, this is already covered by Clause 13(1), which states:

17 July 2013 : Column 797

“The Secretary of State must make regulations requiring active insurers to pay a levy”.

It does not specify active employers’ liability insurers, and in Clause 13(7) I do not see that the definition of the term “active insurer” excludes the public liability insurers. I would be grateful if the Minister would confirm that the legislation as drafted does give him the power to levy the public liability insurers. If that is not the case, I am sure that there will be no difficulty in tabling an amendment for Third Reading.