Michael Howard, the Home Secretary, is expected to recommend dropping his proposal for government-appointed chairmen, as a means of avoiding defeat when the Police and Magistrates Courts Bill has its crucial Third Reading in the House of Lords in the next few weeks.
Mr Howard, who met the principal Tory opponent, Lord Whitelaw, a former Home Secretary, last Thursday, is thought to be determined to ensure that the Government is not forced to postpone the entire Bill because of opposition to one element.
Although no firm decisions have been taken, the Cabinet Committee, EDH, is expected to consider the modification at an early meeting.
Lord Wakeham, the Leader of the Lords, had reported the deep level of Lords opposition over the Bill to the Cabinet last week.
Lord Whitelaw, backed by Lord Carr, another former Home Secretary, was in the vanguard of opposition to the proposal for the Home Secretary to appoint the chairmen of police authorities.
He told his fellow peers that the proposal - strongly opposed by many Chief Constables - risked making the police authority chairmen the 'Home Secretary's men', so compromising the political neutrality of police operations.
Mr Howard does not want to compromise on the Bill's provision for five members of each police authority to be appointed from outside the ranks of local councillors and magistrates. But one view canvassed in Whitehall is that in time the new composition of police authorities could lead naturally to the election of at least some independent chairmen.
Such a concession would be easier for Mr Howard to defend to Tory backbenchers than for his predecessor Kenneth Clarke, since as the Secretary of State for the Environment he argued strongly within Whitehall that councillors should continue to play an important part in the police authorities. As a result the Bill provides for authorities to be composed of 11 councillors, three magistrates and five independent members appointed by the Home Office.
Significantly, Sir Ivan Lawrence, chairman of the influential Commons Home Affairs Select Committee, said in an ITV interview over the weekend that he did not think the issue was so important that it should hold up other reforms in the Bill.
These include greater powers for chief constables to exercise autonomy over finances and to arrange policing priorities according to local needs.
Ministers are less convinced by the complaints of the Lord Chief Justice, Lord Taylor, and other senior figures in the judiciary about the plans to put magistrates' clerks on fixed contracts and make them accountable to a chief clerk appointed by the Lord Chancellor, Lord Mackay.
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