Mr Philip Hammond (Runnymede & Weybridge, Conservative)

The Minister was suffering from premature something there. [Interruption.] I did not say dementia—I thought that the Under-Secretary was suggesting dementia. I have a simple question for the Minister about definition. Clause 12 states that a local authority may invest

''(a) for any purpose relevant to its functions under any enactment, or

(b) for the purposes of the prudent management of its financial affairs''.

I just want to probe the word ''invest''. I used to think that I knew what it meant, but the Chancellor of the Exchequer has corrupted the word ''invest'', as has the Prime Minister.

Over the last five or six years, I have heard about the Government ''investing'' in nurses' pay, for example. Nurses' pay is a very worthy thing to spend money on, but by anyone's historic definition that was not an investment. An investment was the sinking of money into an asset that would yield a long-term return. In the good old days, that word would never have been used to refer to revenue spending, but the Chancellor and the Prime Minister have used the word differently over the last few years.

I therefore thought it important to ask the Under-Secretary to clarify what the relevant definition of ''invest'' is in clause 12. If it is the definition used by the Chancellor and the Prime Minister, the clause could be seen to be giving local authorities the power to ''invest'' in higher wages for their staff, for example, but I assume that that is not intended.

Mr Christopher Leslie (Parliamentary Secretary, Cabinet Office; Shipley, Labour)

I shall not detain the Committee long: clause 12 is fairly self-explanatory. In the process of a cash flow and other normal business undertaken by a local authority, investing sums of money may be required, but oddly there is no explicit permissive power for that

currently. The clause changes that. Its purpose is to avoid doubt about the power of local authorities to invest. Guidance notes are likely to be issued to supplement that freedom, which we touch on later in the Bill. The Bill does not explicitly define the term ''invest'', because it should be interpreted in the normal sense. In other words, it means to place funds with a bank or others for safekeeping.

Mr Philip Hammond (Runnymede & Weybridge, Conservative)

Has the Under-Secretary heard the Chancellor and the Prime Minister use the word ''invest'' repeatedly in a different context and with a different meaning? Does he understand why I and other members of the Committee are confused as a consequence?

Mr Christopher Leslie (Parliamentary Secretary, Cabinet Office; Shipley, Labour)

I could never understand the confusion that enters into the hon. Gentleman's mind. I know what ''invest'' means and I believe that most people of a rational disposition do. I cannot necessarily vouch for the hon. Gentleman, but I hope that the clause is self-explanatory. It should stand part of the Bill.

Mr Philip Hammond (Runnymede & Weybridge, Conservative)

I am grateful to the Under-Secretary for his attempt at an explanation. Clearly, he thinks that no person of a rational disposition could ever be tempted to use the word ''invest'' in any other way than the way in which he understands it. I shall send the relevant extract from Hansard to the Chancellor of the Exchequer and ask him whether he has any comment to make. What the Under-Secretary has said is very helpful.

Question put and agreed to.

Clause 12 ordered to stand part of the Bill.