Legal Aid, Sentencing and Punishment of Offenders Bill
(Limited Text - Ministerial Extracts only)
Read Full debate16:44 - Division on Amendment 3 - Ayes: 232 / Noes: 220 - Amendment 3 agreed.
17:00 - Division on Amendment 4 - Ayes: 228 / Noes: 215 - Amendment 4 agreed.
17:15 - Division on Amendment 5 - Ayes: 206 / Noes: 229 - Amendment 5 disagreed.
18:04 - Division on Amendment 16 - Ayes: 199 / Noes: 224 - Amendment 16 disagreed.
18:36 - Division on Amendment 19 - Ayes: 201 / Noes: 201 - Amendment 19 disagreed.
19:17 - Division on Amendment 21 - Ayes: 176 / Noes: 206 - Amendment 21 disagreed.
19:40 - Division on Amendment 24 - Ayes: 162 / Noes: 195 - Amendment 24 disagreed.
20:28 - Division on Amendment 25 - Ayes: 120 / Noes: 194 - Amendment 25 disagreed.
21:18 - Division on Amendment 31 - Ayes: 69 / Noes: 123 - Amendment 31 disagreed.
23:40 - Division on Amendment 41 - Ayes: 26 / Noes: 107 - Amendment 41 disagreed.
Lord McNally
(a) add services to Part 1 of Schedule 1, or(b) vary or omit services described in that Part,”
The Minister of State, Ministry of Justice (Lord McNally)
My Lords, the Government have tabled government Amendments 1, 6, 7, 8, 13, 14 and 18 following the commitment I gave on Report. The Government have listened to the reasoned arguments presented by my noble friend Lord Thomas of Gresford and other noble Lords, and we have brought forward these amendments accordingly.
Amendment 1 to Clause 9(2) would give the Lord Chancellor the power to omit, but in addition the power to add or vary the services in Part 1 of Schedule 1. He would be able to do so by modifying Parts 1, 2, 3 and 4 of Schedule 1. The power to vary a service allows us to amend the existing services within the schedule where they need to be altered, but without the need to omit a service and then add a new service. For example, if the Immigration (European Economic Area) Regulations 2006 were amended in the future, any such amendment might not mean that services need to be added to the schedule, but it might be necessary to vary the provisions in paragraph 31 of Part 1 in order to reflect any such changes to those regulations.
The provisions of Amendment 1 mean that the power in Clause 9(2) would be similar to that which exists in Section 6(7) of the Access to Justice Act 1999. We consider that this is the correct and sensible approach to take. The powers in Clause 9(2) would be exercisable by the Lord Chancellor when making an order. Clauses 41(6) and 41(7)(a) mean that such an order would be subject to the affirmative procedure and so subject to debate in and approval by each House of Parliament.
Amendment 2, tabled by the noble Lord, Lord Bach, would allow services to be added but not to be omitted. As I have said, the government amendment provides for balance to the existing Clause 9. Amendment 2 seeks to go further and actually removes the ability to omit. I firmly believe that that power to omit is necessary and gives the Bill a welcome flexibility. An example of where this may be necessary is where the governing legislation behind an area of law is repealed or otherwise altered and we need to alter civil legal aid provision accordingly. Another example would be where particular court proceedings are moved to a tribunal. It may cease to be appropriate to provide funding for advocacy for those proceedings, so an amendment to Part 3 of Schedule 1 would be needed.
As a result of Amendment 1, we no longer consider that we need certain powers in Schedule 1 to make secondary legislation. The purpose of this is not to reduce the categories in which legal aid will be available but are more technical in nature. To ensure that this is clear, let me explain in detail the powers which will be removed. First, Amendments 6 and 7 relate to paragraph 4(1)(k) of Part 1 of Schedule 1, which concerns the care, supervision and protection of children and provides for further orders or procedures to be prescribed for the purposes of this paragraph. In the light of the power to add services proposed by Amendment 1, we consider that the power at paragraph 4(1)(k) of Part 1 of Schedule 1 is no longer necessary.
Secondly, Amendment 8 would omit paragraph 9(3)(n) of Part 1 of Schedule 1, which relates to community care. Paragraph 9(3) defines community care services as services,
“which a relevant person may provide”,
under a number of listed enactments. Heading (n) of that definition allows other enactments to be prescribed for the purposes of that definition. With the power to add services under Clause 9, this is no longer necessary.
Baroness Butler-Sloss
My Lords, as a Cross-Bencher, I add to what the noble Lord, Lord Bach, has just said about the death of a man who was a great friend to many of us. Lord Newton was an adornment to this House, who stood, as the noble Lord, Lord Bach, has already said, for his conscience rather than for what his party, or any party, might wish. It is easy for me as a Cross-Bencher to examine my conscience, and I am well aware it is not so easy for members of political parties. He will be enormously missed. His name is on a number of today’s amendments, and I hope that noble Lords will forgive me for saying something about this before I move to Amendment 1.
I congratulate the Government. I do not do it terribly often but am going to do it three times today. This amendment, as the noble Lords, Lord Thomas of Gresford and Lord Bach, have said, is overdue. It is splendid that the Government have recognised the importance of having the ability to increase legal aid. I also very much support the fact that they are putting in “vary or omit”. All of us who have had anything to do with legislation know that from time to time it becomes redundant and has to be got rid of or needs a tweak here and there, and therefore needs a variation. I support this amendment as it is.
However, if the Minister will forgive me, I will make one or two points about what has happened as a result of this Bill so far as family cases are concerned. The noble Lord, Lord Thomas of Gresford, has already mentioned this but I will add to it. I strongly urge the Government to review the impact of the legal aid changes no later than a year from now, to see what happens to the family courts in the light of the removal of nearly all private law cases from legal aid. I am not sure the Government really quite accept what a number of us have been saying, to the Ministers in this House and the other place, about the impact on the courts. There will be longer lists. I know the Ministry of Justice is already aware that the lists in the courts are too long, and they will be increased substantially.
There will be longer hearings. As the noble Lord, Lord Thomas of Gresford, said—entirely accurately—without lawyers to keep a case under control, two litigants in person will spend an absolute age. The sort of case that takes a day, or possibly a day and a half to two, will take not less than a week. I have a vivid recollection of one litigant in person who took a week to give evidence and cross-examine. Every time I asked him to hurry up, it added another hour or two to the case. I am afraid I sat scribbling nonsense, because nothing he said was of any value to the conduct of the case.
It is going to be very difficult for district judges and magistrates to manage people totally caught up in the emotions of a failed relationship and fighting over money, a house or particularly children. They will have to do it but it will clog up the courts to an even more significant degree.
It will have an impact in children’s cases. One example in child protection issues is the fact that drink or drug abuse is sometimes detected only during the hearing of a private law case. It is crucial that the person who is drinking or taking drugs to excess is tested to see what should be done as to whether that parent is fit to have care of the child, or even to see the child. The Minister will be aware that in the Norgrove report that point was made about the very thin line between the private law cases and those that tip over into child protection issues. On Report, we discussed whether the mediator would identify cases where there might be abuse. There is a hard core of 5 per cent of cases that cannot be settled between the parties—and, of course, that 5 per cent of cases will carry on regardless and may not ever come to the attention of the mediator.
I ask the Minister, in congratulating him on proposing the amendment, to have a real look at the impact on the family courts within no later than a year to see what is actually happening.
Lord McNally
My Lords, of course I associate myself with the expressions of sympathy on the untimely death of Lord Newton.
On the matter raised by the noble and learned Baroness, we are committed to undertaking a post-implementation review of the specific policies set out in the Bill. As she acknowledged, we have just replaced a ratchet by a regulator, which should also help in seeing whether some of her predictions come true, and how we react to that.
Lord Bach
From the opposition Front Bench I can be extremely brief, as I should be because this is Third Reading. These are very important amendments which the House will have to decide on shortly. JustRights has done some number-crunching on the issue of children. It points out that, while 95 per cent of funding may be protected, only 74 per cent of children are protected likewise. Therefore, the 6,000 mentioned by the noble Baroness who moved Amendment 3 will be left to navigate the legal system alone. These children will have no adult to help them—no litigation friend, in parlance.
It is absurd to think that in social welfare law cases, a conditional fee agreement is any substitute whatever for basic legal aid for getting legal advice for the kind of problems that affect these children. In effect, we are being asked to abandon some of these children— 16 year-olds perhaps—to a legal system that is far from understandable. They will be mainly children in care who have fractured relationships with their parents. The House knows so well that these are exactly the kind of children who, if they do not get early legal help, may end up in young offender institutions or secure children’s homes at enormous cost to the state, which would be much more than the small amount that the Government claim will be saved by not giving them legal aid. How much wiser would it be to spend that money early? Surely, for children, legal aid is greatly preferable to a CFA right across the board. We support the amendments.
Lord McNally
My Lords, in debates like this, I am always a little worried that noble Lords not in the Chamber when the Division Bells ring will come along and say, “What is this about?”. They may be told, “Oh, we are voting on legal aid for children”. Let us be clear, these amendments and this debate are not about whether we provide legal aid for children and vulnerable people; nor is it about not being willing to help those least able to help themselves; and nor is it about denying help to the most vulnerable in our society.
As my noble friend Lord Thomas of Gresford pointed out, the core principle of our reforms is to ensure that civil legal services will continue to be available in the highest priority cases; for example, where a person’s life or liberty is at stake or where children may be taken into care. The application of this principle has led us to protect the vast majority of funding and cases involving children. They include child protection cases, civil cases concerning the abuse of a child, special educational needs cases and cases involving children who are made parties to private family proceedings. Noble Lords will also recall that we have moved to make funding available for clinical negligence cases concerning brain-damaged infants. It is simply not true therefore to suggest that there will be no funding or very substantially reduced funding for the cases involving children and young people.
In addition, as indicated earlier, we have moved the amendment ratchet to “regulator” which will enable us to test whether some of the more dramatic warnings that have been issued about our reforms can be looked at. We are committed to undertake a post-implementation review of the specific policies set out in Bill. We believe that these safeguards are sufficient to ensure that children do not fall through the net. Our approach will mean that 97 per cent of current spend on cases involving child claimants will continue, and that is the overwhelming majority of current support. Spending reductions are never welcome, but I hope these figures put it beyond doubt that we have made a genuine endeavour to ensure that children are protected, even as we push on with the wider objective of our reforms, which is to focus scarce resources on the most serious cases, to contribute to savings and to reform the system.
Lord Beecham
That is on top of the £80 million of cuts to citizens advice bureaux.
Lord McNally
Citizens advice bureaux operate in a country that is 10 per cent poorer than the last Government gave the country to understand. It is absurd to pretend that citizens advice bureaux or any other sector—local government and national government —should not face this reality.
In civil cases, it is already a requirement of the rules of civil litigation that a child or other protected party who lacks capacity must have a litigation friend to conduct a case on their behalf. In the case of a child, this is usually a parent unless the court specifically orders otherwise. It will only be in exceptional circumstances that the court will make an order permitting the child or protected party to conduct proceedings on their own behalf. Any step taken before a child or protected party has a litigation friend is of no effect unless the court makes such an order. There is no requirement that a litigation friend must act through a solicitor. It is therefore open to a child’s parent or other person caring for the child, for example, to act as the child’s litigation friend in proceedings where the child is a party. We believe that this provides a clear safeguard for children and vulnerable young people who lack capacity to conduct proceedings on their own behalf.
We recognise that Amendment 5 also covers the 18 to 24 year-old category. As I said earlier, we have provided for those who are most vulnerable. However, we have also been clear that, in what is a complex area, there must be flexibility. The exceptional funding scheme therefore provides a mechanism whereby the director of legal aid casework can grant legal aid in areas of scope which would normally be out of scope, where necessary, to ensure the protection of the individual’s right to legal aid under ECHR and EU law. In cases engaging Article 6 of the ECHR, the director of legal aid casework must take into account a person’s ability to represent themselves, the complexity of the proceedings, the importance of the issues at stake and all other relevant circumstances. An individual’s age as well as their capacity will be a key consideration in determining a person’s ability to represent themselves. The exceptional funding scheme will clearly be an important safeguard for children and vulnerable young people who would otherwise be unable to present their case.
Amendment 3, in particular, seeks to bring all cases back into the scope of legal aid where a child is a party, but the Bill already provides for child parties to be within scope of legal aid in family proceedings. The amendment is therefore in part unnecessary and seeks to replicate what is already in scope. The rest of the amendment seeks to keep funding across the board for children in all civil disputes without regard to the relative priority or alternative methods of resolving them. The majority of children will already fall within the scope of legal aid as provided for by the Bill. However, there are additional safeguards to provide further protection through exceptional funding powers and, should it prove necessary, the power to add to civil legal services.
The Archbishop of York
The Minister has not yet answered the question which I think the noble Lord, Lord Thomas, raised—and had I had the chance, I would have raised the same question—on Amendment 3, in relation to proposed new paragraph 1(1)(k), which specifies:
“civil legal services relating to an appeal to the Supreme Court”.
I have not seen that provision in the Bill as drafted, but it is quite important. What will happen to it? I agree with the Minister about the other provisions, but I do not think that he has answered the question on that one.
Lord McNally
It is always a pleasure to see the most reverend Primate the Archbishop of York in his place. I shall give him a definitive answer as I sum up and come to my peroration, as there are a number of other matters that I wish to cover.
Amendment 4 seeks to bring into scope children for all clinical negligence cases. I have already set out my arguments on how we have protected children in the Bill. On clinical negligence, in particular, we recognised the concerns that serious and complex cases involving brain-damaged babies may not be able to secure a conditional fee agreement, and we therefore brought forward an amendment on Report that will provide certainty for families and make the application process straightforward.
The amendments we have made will allow funding for cases where the negligence occurs in a period of time beginning with the point of the mother’s pregnancy until eight weeks after birth. This does not mean that the symptoms have to become apparent during this period. They could become apparent beyond this period and still be in scope providing that the relevant negligent act or omission took place during that period. We also moved to include an additional safeguard in respect of babies who are born prematurely. We recognised that these children are particularly vulnerable in the post-natal period and have therefore provided that where a baby is born before the 37th week of pregnancy, the period of eight weeks will not run from birth but will be taken to start from the first day of what would have been the 37th week of pregnancy. I hope noble Lords will recognise that the Government have listened and acted to introduce back into scope the most serious clinical negligence cases involving children.
Amendment 5 seeks to bring into scope civil legal services in relation to advice and proceedings for any person who is 24 years old or under and has a disability, is a former care leaver or is a vulnerable person as specified by regulations. We have provided for those who are most vulnerable, as I have said, under Amendment 3, which covers those under the age of 18. However, we have also been clear that there must be flexibility in this complex area. The exceptional funding scheme therefore provides a mechanism whereby the director of legal aid casework can grant legal aid in areas that would normally be out of scope, where necessary, to ensure the protection of an individual’s rights to legal aid under the ECHR and EU law. In cases engaging Article 6 of the ECHR, the director of legal aid casework must take into account a person’s ability to represent themselves, the complexity of proceedings, the importance of the issues at stake and all other relevant circumstances. An individual’s age as well as their capacity will be key considerations in determining a person’s ability to represent themselves. The exceptional funding scheme will clearly be an important safeguard for children or vulnerable young people who would otherwise be unable to present their case.
I am told that we have lost the vote about retaining legal aid for appeals to the Supreme Court.
Lord McNally
The most reverend Primate the Archbishop of York may be disappointed to know that he may have been absent to defeat us on that point at an earlier stage. As the noble Lord, Lord Bach, has indicated, the Government will look at these matters between now and consideration in the other place.
The only outstanding point that I wanted to cover was that made by the noble Lords, Lord Thomas and Lord Avebury, about the balance between CFAs and legal aid in injury cases. Although I am not a lawyer, I would say that, on balance, CFAs are the most effective way of taking these cases. It is worth remembering that 82 per cent of cases are already covered by CFAs. People are not left abandoned on a lonely sea—the process works.
It is always difficult to draw lines and easy to say that the lines have been drawn in the wrong place. As I said in opening, the amount of coverage for young people in this area is completely different from what was suggested in some speeches today. We believe that between the coverage of scope that we put into this Bill, the workings of exceptional funding and the availability of wider advice, there will not be the kind of consequences that have been suggested. I also make it clear that we do not think that Amendments 3, 4 and 5 are consequential, so if noble Lords do press them, we would want to test the opinion of the House on each. However, I hope that the noble Baroness will agree to withdraw her amendment.
Baroness Grey-Thompson
My Lords, I thank the Minister for his comments and consideration. The House appreciates that he has perhaps been given little or no room for manoeuvre. I would also like to thank all Members who have tried to ensure that children’s interests are safeguarded in this Bill. Most of all, I thank Members on the government Benches who have understood the problems with this legislation right from the start and have been prepared to raise them. We all understand that this is a very difficult thing to do. However, because of the very nature of the legislation and its impact on those unable in law to represent themselves, we need to ask the other place to take another look. Therefore, I wish to test the opinion of the House.
The Advocate-General for Scotland (Lord Wallace of Tankerness)
My Lords, this is an important government amendment on an issue that has been the subject of considerable debate in your Lordships’ House and, indeed, in the other place, on legal aid for cases of domestic child abduction. We have always been clear that legal aid should be available to both prevent and remedy international child abduction and, as indicated on Report, we have been listening sympathetically to the powerful arguments about legal aid for domestic child abduction. We agree that the unusual nature of these cases, including the terrible impact on those involved, means that legal aid is justified to find a child who has been unlawfully removed within the United Kingdom.
We think that our amendment, which has been worked up in the light of discussion with the noble and learned Baroness, Lady Butler-Sloss, achieves this. One point that the noble and learned Baroness has asked the Government to put on the record, which I am happy to do, concerns what we mean by unlawful removal. Unlawful in this sense has a civil rather than a criminal meaning, so if a parent with contact tried to take a child permanently from the parent with residence, that would be unlawful.
Lord Beecham
My Lords, it is only a few weeks since the noble Lord, Lord McNally, described Lord Newton as a national treasure except when he voted against the Government. I intervened somewhat mischievously to say that that was what made him a national treasure. In fact, of course, he was a national treasure for a long time before that. I have good memories of working with him when he was a very approachable Minister and I was the leader of my local authority. I also had the pleasure of serving under him as a member of the Local Services Honours Committee, which he chaired with great care, always exhibiting great thoughtfulness and fairness. He was a man of great conviction and great courage, as he demonstrated fully in your Lordships' House for so many months. We will all miss him, as other noble Lords rightly said.
I turn to the amendments in this group and join the noble and learned Baroness, Lady Butler-Sloss, in acknowledging that the Government have made significant improvements to the Bill and in congratulating the noble and learned Lord on doing that. I also congratulate the noble and learned Baroness on initiating these very welcome changes. I endorse what she said about further developments. Now, of course, the Government have the capacity to bring them about without primary legislation. The Opposition look forward to that in due course and certainly support the amendments in this group.
Lord Wallace of Tankerness
My Lords, I start by associating myself with the comments made by the noble Lord, Lord Beecham, about Lord Newton. I first encountered him in 1983 when I was a newly elected Member of Parliament and he was the Social Security Minister. I had a particular constituency issue and he could not have been more helpful or understanding. That was my experience of him as a Minister throughout my time in the other place.
The noble and learned Baroness, Lady Butler-Sloss, outlined her wish list. I think that she understands why the Government are unable to accept at the moment that legal aid should be available for these prevention matters. We find it difficult to see how the orders covered would be used in practice for prevention of removals in situations of urgency for which a case for funding is made, rather than for securing return after removal. If a child was in the process of being abducted and the situation was an emergency, legal aid would be available for the purpose of securing their return. It is more difficult to see why legal aid should be available to fund applications that are more contingent in nature, where there is no imminent danger of abduction or associated emergency but the measure is being sought on a precautionary basis. Very often those cases will be the stuff of general private family law proceedings, and we see the risk of such orders being sought for the benefit of funding in what are general disputes over where a child is to live and with whom—which, as we made clear in other areas, we will not fund.
Having said that, I welcome the co-operation that there has been, and very much appreciate the comments made by the noble and learned Baroness about the officials who worked on this and productively engaged with her and with those who advised her. I hope that what we brought forward meets the concerns raised. I have no doubt that we will be reminded of the wish list when we have had a bit more experience of the Act in operation. Again, I thank all those, both inside and outside the House, who worked toward a constructive solution on this matter.
“( ) an order under section 34 of that Act for the child’s return;”
“Victims of trafficking in human beings33A (1) Civil legal services provided to an individual in relation to an application by the individual for leave to enter, or to remain in, the United Kingdom where—
(a) there has been a conclusive determination that the individual is a victim of trafficking in human beings, or(b) there are reasonable grounds to believe that the individual is such a victim and there has not been a conclusive determination that the individual is not such a victim.(2) Civil legal services provided in relation to a claim under employment law arising in connection with the exploitation of an individual who is a victim of trafficking in human beings, but only where—
(a) the services are provided to the individual, or(b) the individual has died and the services are provided to the individual’s personal representative.(3) Civil legal services provided in relation to a claim for damages arising in connection with the trafficking or exploitation of an individual who is a victim of trafficking in human beings, but only where—
(a) the services are provided to the individual, or(b) the individual has died and the services are provided to the individual’s personal representative.Exclusions(4) Sub-paragraph (1) is subject to the exclusions in Parts 2 and 3 of this Schedule.
(5) Sub-paragraphs (2) and (3) are subject to—
(a) the exclusions in Part 2 of this Schedule, with the exception of paragraphs 1, 2, 3, 4, 5, 6 and 8 of that Part, and(b) the exclusion in Part 3 of this Schedule.Definitions(6) For the purposes of sub-paragraph (1)(b) there are reasonable grounds to believe that an individual is a victim of trafficking in human beings if a competent authority has determined for the purposes of Article 10 of the Trafficking Convention (identification of victims) that there are such grounds.
(7) For the purposes of sub-paragraph (1) there is a conclusive determination that an individual is or is not a victim of trafficking in human beings when, on completion of the identification process required by Article 10 of the Trafficking Convention, a competent authority concludes that the individual is or is not such a victim.
(8) In this paragraph—
“competent authority” means a person who is a competent authority of the United Kingdom for the purposes of the Trafficking Convention;
“employment” means employment under a contract of employment or a contract personally to do work and references to “employers” and “employees” are to be interpreted accordingly;
“employment law” means an enactment or rule of law relating to employment, including in particular an enactment or rule of law conferring powers or imposing duties on employers, conferring rights on employees or otherwise regulating the relations between employers and employees;
“exploitation” means a form of exploitation described in section 4(4) of the Asylum and Immigration (Treatment of Claimants, etc) Act 2004 (trafficking people for exploitation);
“personal representative”, in relation to an individual who has died, means—
(a) a person responsible for administering the individual’s estate under the law of England and Wales, Scotland or Northern Ireland, or(b) a person who, under the law of another country or territory, has functions equivalent to those of administering the individual’s estate;“the Trafficking Convention” means the Council of Europe Convention on Action against Trafficking in Human Beings (done at Warsaw on 16 May 2005);
“trafficking in human beings” has the same meaning as in the Trafficking Convention.”
Lord Wallace of Tankerness
My Lords, Amendments 15 and 17 bring into the scope of legal aid cases in which the victims of human trafficking seek damages in either the civil courts or an employment tribunal. They would also provide legal aid to this group for immigration advice. The Government have always anticipated that legal aid would be available under the exceptional funding scheme for these damages claims, where such cases met the test for exceptional funding under what is now Clause 10 but which we came to know as Clause 9 during the earlier passage of the Bill. However, we listened to the concerns raised by noble Lords about whether in practice this would always be appropriate. I am pleased to say that we have responded positively to the concerns, and not least to the case made at Second Reading, in Committee and on Report by the noble and learned Baroness, Lady Butler-Sloss.
The House should be aware that paragraph 40 of Part 1 of Schedule 1 already provides for legal aid to be granted to victims of sexual offences to bring damages claims in relation to the offences. People who have been trafficked for the purposes of sexual exploitation and who wish to claim damages through the civil courts will already be able to get legal aid.
As I indicated on Report, we also considered whether legal aid should be available for the immigration aspects of trafficking. We listened to and accepted the arguments on this, given the particular vulnerabilities of this group of people. We plan to set out in regulations further provision on when it is appropriate for a victim of human trafficking to qualify for civil legal aid for immigration matters. Our intention is not to restrict numbers, and we will ensure that all victims for whom it is appropriate to provide advice will receive it. However, we cannot have a completely open-ended commitment for all immigration matters; otherwise, it is conceivable that victims of trafficking who, for example, apply for a student visa 15 years down the line will continue to qualify for legal aid for no good reason. The regulations will limit eligibility to a period relevant to the experience of being trafficked. We are discussing the most appropriate period of time, but we intend that it will be no less than an individual’s discretionary leave to remain, which can be up to three years.
I am pleased that we have been able to have a constructive engagement and hope that these amendments address the concerns that have been raised. This amendment includes legal aid for immigration advice for victims of trafficking. I beg to move.
Baroness Butler-Sloss
As the co-chairman of the All-Party Group on the Trafficking of Women and Children, I again congratulate the Government and express my gratitude not only to Ministers in this House and in another place but to the government lawyers and officials. The people who were so helpful on the previous set of amendments have been equally helpful on this, and I and those behind me are enormously obliged to them for the care with which they have gone through this and their ability to recognise, listen to, take on board and accept the points that have been made which are now reflected in this excellent amendment.
I wonder whether I might again produce a wish list for consideration at some later stage. There are four points that I would like to make. First, there are those who have been trafficked who do not know that they have been trafficked and will need advice about whether they have been trafficked. Secondly, there are implications for referral to the national referral mechanism. That point was discussed with the government lawyers. I understand why Ministers do not want to help those who do not refer themselves, but there will be a group or groups of people who will fall through the net. Thirdly, there are those who do not know whether they may have an entitlement to leave to remain other than by an asylum claim, such as discretionary leave to remain. That group will also not be covered. The fourth group is rather different. It is those who would wish to challenge a decision by the Home Office that they do not come within the NRM. Those are perhaps matters for another day. At the moment, those behind me and I are enormously grateful for what we have already got.
Lord Wallace of Tankerness
I am grateful for the general welcome that has been given to the amendments, and indeed for the work that has gone in behind the scenes to get us to where we are today. The noble and learned Baroness, Lady Butler-Sloss, has indicated that she will continue, and that she has a further wish list. The fourth point in her wish list was to find out how to challenge a decision of the national referral mechanism. I am advised that that would be done by way of judicial review, which is within the scope of legal aid.
My noble friend Lady Hamwee raised more detailed questions about the operation of the provision. I will look at those matters and try to write to her with an answer. She also asked whether there are any plans to limit immigration legal aid in this context, apart from the time limits under regulations. The answer is that there are currently no plans to do so. In referring to the progress of these amendments and this issue through your Lordships' House, my noble friend also remarked that the noble and learned Baroness, Lady Butler-Sloss, has kept at it. I have no doubt that, even after this legislation becomes law, those who take a keen interest in the serious—appalling—issue of the abuse of individuals will keep a watchful eye on the issue and keep at it, and I am sure that the Government will certainly be made aware of any concerns that arise. On that basis, I hope that the House will agree to the amendment.
Lord Beecham
My Lords, I support my noble friend Lady Hollis and, of course, the noble Lord, Lord Best, in moving this amendment. They have made a very powerful case, which was rehearsed on Report. At that time, I quoted Shelter and the Nottingham Law Centre, two separate organisations from the not-for-profit sector, which strongly urged the Government to change their position on this. They are the organisations that provide legal help and advice, not necessarily extending to court proceedings, on the benefits side as well as the remainder of the housing issue—some of which, in fairness, the Government are including within scope.
This is a classic case, as my noble friend has implied, where there is a potential modest saving to the Ministry of Justice budget but a potential extra cost to other departments. If homelessness ensues, particularly where children are involved, very substantial costs are imposed on the budgets of the local authority, and maybe also on the Department for Work and Pensions, which in certain circumstances may be devolved; for example, special needs payments or crisis loans, which a family on the streets may clearly require.
In this context, cost is a consideration which, if anything, tells against the Government’s proposals rather than the other way round. I hope that the Government will recognise the strength of arguments from those dealing with this directly—not from the legal profession in this case, but from the advice sector—and provide for the possibility of timely advice being given to avoid worse consequences for the individuals and their families and, for that matter, the public purse. I hope that the Minister will reconsider the position the Government have hitherto adopted.
Lord McNally
My Lords, the noble Lords, Lord Beecham and Lord Best, acknowledge that this is one more time on which we have discussed these matters. We had detailed discussions in Committee and on Report. Amendment 16 is intended to bring into the scope of legal aid advice and assistance in relation to an individual’s financial situation, such as debt and housing-related welfare benefits issues, where they are linked to the loss or threatened loss of the individual’s home under paragraph 34 of Part 1 of Schedule 1. The House will be well aware that our proposals ensure that legal aid continues to be available to an individual in relation to the immediate risk of losing their home, through possession or eviction. This includes cases where the underlying cause is a debt or welfare benefits issue.
It may reassure noble Lords if I reiterate a few brief examples of where legal aid will be available under the loss-of-home provisions in paragraph 34 of Part 1 of Schedule 1. First, legal aid will continue to be available before a case is brought to court. It will be available where possession or eviction action is contemplated. Where an individual receives a letter which threatens possession action, legal aid will be available at that point. For example, legal aid will remain available to a person threatened with possession action for mortgage arrears to negotiate with their mortgage lender.
In the context of welfare benefits, it is important to recognise that, where a landlord threatens their tenant with possession proceedings, legal aid would be available to the tenant to reach agreement with a landlord to delay the possession action pending the resolution of the welfare benefits issue. If possession proceedings are issued, legal aid will be available to an individual to argue for an adjournment—for example, if they are likely to be able to make the necessary payments if an underlying benefits dispute is resolved in their favour. Where an individual loses a welfare benefits appeal and subsequently faces possession action for rent or mortgage arrears, legal aid will be available in relation to that action. We will also retain legal aid provision for judicial reviews about welfare benefits decisions and for welfare benefits matters which relate to a contravention of the Equality Act 2010.
This amendment would go much wider and would generally provide for legally aided advice and assistance on the financial circumstances of an individual—such as for underlying debt or welfare benefits issues—where these are linked to loss of home. This would run contrary to our approach. At a time when the country is recovering from a genuine fiscal crisis we need to focus limited resources on the highest-priority matters. As I have said before, we cannot agree that legally aided advice and assistance should be generally available in relation to a person’s financial circumstances—such as for debt or welfare benefits issues—in the situations covered by the amendment.
There is no doubt that people, including those in potential loss-of-home situations, find advice useful in areas such as debt and welfare benefits. But we are firmly of the view that what those affected often need is practical advice rather than legal advice funded by legal aid. Individuals who have debt problems often need advice on managing their finances better and on practical measures to resolve their situation, and can access that advice through a range of specialist organisations. It will come as no surprise to the House to hear me repeat that the Government greatly value the not-for-profit sector and the good-quality free advice which it provides to people in their communities on these sorts of matters.
My department is working closely with the DWP to improve the quality and effectiveness of initial decision-making in applications for social security, reconsideration within the DWP and the system of subsequent tribunal appeals. This work should make it easier for claimants to receive the right benefit provision. Moreover, welfare benefits appeals matters are resolved through a tribunal which is designed to be accessible without legal assistance, and general advice on welfare benefits is available from a number of sources.
I know that this issue has been raised at every stage. After these debates, we do not just close the book and not take any notice. We go back to the department and the Ministers and advisers have a discussion. There is also a discussion about the issues raised with other departments. This is not a decision taken lightly but we believe that the loss-of-home proposals in the Bill get the balance right in terms of focusing limited public funds for legal advice and assistance in the most appropriate circumstances. We have listened to the appeals made by the noble Lord and considered them. At this point, we cannot agree with them. I ask him to withdraw his amendment.
Lord Best
I am grateful to noble Lords who have spoken. I am also grateful to my noble and right reverend friend Lord Harries of Pentregarth, who put his name to this amendment but has had to leave us. I thank the noble Baroness, Lady Hollis, for talking of the perfect storm at a time of housing benefit change when advice will be incredibly important to people. Things will change dramatically on the benefit front and mistakes will be made by the officials concerned. Experts will be needed for support and assistance. I am grateful to the noble Lord, Lord Beecham, who reminded us that Shelter, Citizens Advice and such bodies are behind this amendment rather than the lawyers. He also mentioned the extra costs that homelessness always brings.
This is a cost-saving amendment. The noble Lord is right that much remains within scope. Some 75 per cent to 80 per cent of the work currently being done remains within scope, which is great, but a lot of that is wasted if the remaining 20 per cent to 25 per cent is cut out. Where possession is threatened is the bit where the argument can be taken up with the administrators, the housing benefits officers. With their negotiating skills and expertise, they can fix it and sort it. Cutting that out renders a lot of the rest of the expenditure much less worth while.
Before the hour gets any later and without further ado, I wish to test the opinion of the House.
Lord McNally
Lord Wallace of Tankerness
My Lords, the House had the opportunity to debate issues similar to those raised in the amendment during detailed discussions in Committee and on Report. As the noble Lord, Lord Pannick, indicated, my noble and learned friend Lord Mackay of Clashfern came up with the phrase “in the interests of justice to prevent injustice”, which I said at the time had a certain seductive charm and that I would think about it. The noble Lord, Lord Pannick, moved the amendment and argued his case with seductive charm, as did the noble Lord, Lord Hart. The noble and learned Lord, Lord Woolf, was very much to the point, as was, very briefly, the noble Lord, Lord Bach.
I can assure the House that we have thought about these points. The Government believe it is right that there should be an exceptional funding scheme to provide an essential safety net for the protection of an individual’s fundamental rights of access to justice, and Clause 10 achieves this important end. It will be necessary to provide services to an individual under Clause 10(3)(a), where a failure to provide some measure of legal aid would, for example, clearly amount to a breach of Article 6 of the European Convention on Human Rights, which guarantees an individual’s right to a fair trial and access to the courts.
As has been said on a number of occasions when we have debated exceptional funding determinations under what was Clause 9 but is now Clause 10(3), they will be made in accordance with the factors that the domestic courts and the European Court of Human Rights have held to be relevant in determining whether publicly funded legal assistance must be provided in an individual case.
In considering whether legal aid should be provided in an individual case engaging Article 6, the director will need to take into account, for example, the importance of the issues to the individual concerned and the nature of the rights at stake; the complexity of the case; the capacity of the individuals to represent themselves effectively; and the alternative means of securing access to justice.
It is not lost on me that the noble and noble and learned Lords who tabled the amendment have carefully mirrored the existing formulation of the clause in their proposed addition. I thank, particularly, the noble and learned Lord, Lord Mackay of Clashfern, for triggering this discussion and this line of thought in Committee. I again assure the House that I have considered the alternative formulation carefully. However, as I said on Report, we are satisfied that the provision that the Bill currently makes in respect of excluded cases is both appropriate and sufficient.
Lord McNally
Lord McNally
My Lords, the House will recall that my noble friend Lord Macdonald was most persuasive in Committee so that during Report a government amendment was agreed that removed the power to introduce means testing and make regulations setting criteria for determinations in relation to advice and assistance for individuals in custody. Amendment 20 is a government amendment that removes references to determinations under Clause 13, on police station advice and assistance, from Clause 21, which concerns financial resources. This is a consequential amendment in light of the Government’s amendment accepted on Report to remove the power to means test police station advice and assistance. This technical amendment is required to remove from Clause 21 the reference to regulations under Clause 13. I beg to move.
Lord Stevenson of Balmacara
My Lords, the noble Baroness, Lady Coussins, has introduced this group of amendments with her customary fluency and passion, and she has been joined by other speakers who have made the case well. As has been pointed out, this measure risks damage to the UK’s reputation for justice to those people who have suffered damage to their human rights caused by companies based in the United Kingdom. I am sure that none of us wishes to see that happen.
We have support from all around the House, and we are grateful to those who have joined in on these amendments. The settled view of your Lordships’ House is clearly that there is a real danger that, if this Bill goes through in its present form, the changes that it makes to the way in which international human rights cases are to operate, combined with the restricted damages that the Rome II regulations impose on the level of damages that can be awarded to claimants, will make it impossible for such cases to be mounted in the UK in future.
As the House has heard, several very important independent charities have been lobbying hard on this issue. Several meetings have been held with the Minister and correspondence has been exchanged. We hoped that an accommodation could be reached, and we went to see him yesterday in the hope that that might be possible. He e-mailed us today to say that he could not accept our amendments.
It is clear to me that while on the one hand the Government do not want to be responsible for preventing these cases continuing in future, they have not so far been convinced that it is highly probable that they will occur in future. Why is that? The arithmetic, as has been said, is very clear. We seem to be in a situation where the department’s overriding concern that the architecture of the Bill should be retained is working here against good legislation. What other arguments can there possibly be? We have heard from those directly involved in these cases and we know what the figures are. It is clear that the facts outlined by the noble Baroness, Lady Coussins, and my noble friend Lord Brennan that the Government are wrong. I hope that when the time comes the noble Baroness will test the opinion of the House, and we will be supporting her in the Lobby.
Lord McNally
My Lords, I confirm that we have been in regular discussions about these amendments, and I regret that I am not able to accept them today.
There have been a number of comments about costs and indeed about the Trafigura case. What strikes me most about that case is that the £30 million that was won in damages worked out at about £1,000 per victim—against, as has already been accepted, legal costs that at one time, until they were beaten down, were running at £100 million. To me, that is an obscene system.
With regard to the reforms that we brought forward, we have said that we believe CFAs will continue. We are also introducing damages-based agreements. Far from welcoming them, though, the CBI and others worry that those may well provide funding in this area. So, it is not that the Government are opposed to bringing companies to account for their behaviour. I just do not believe in the rather broad claims by the noble Lords, Lord Brennan and Lord Judd, that this issue will dramatically affect the lives of people in developing countries. There are other areas of policy that are going to do much more than that.
I make clear that the Government strongly support claims arising from allegations of corporate harm in developing countries being brought, and we support the protection of damages for personal injury. Where we disagree with the supporters of the amendment is that we do not believe that our plans would prevent such cases being brought or ultimately damage the ability of NGOs and others to hold big business to account.
An exception along the lines proposed is in our view neither necessary nor justified. It is not necessary because reformed “no win no fee” arrangements will still allow cases to be brought. It is not justified because it would undermine the wider rationale for the Jackson reforms in Part 2 of the Bill, which should apply across civil litigation without any exceptions. In doing so, it would introduce unfairness between different types of claimant.
We recognise, however, that, following the Rome II regulations, damages in these cases can be relatively low, and they will not be subject to the 10 per cent increase available for other claims. The costs awarded can nevertheless be extremely high, as was demonstrated by the Trafigura case. The question is whether any exception should be made for these cases either on a wider basis, as proposed in Amendments 21, 22, 23 and 26, or on a narrower basis, as proposed in Amendment 27. I concede that in putting forward Amendment 27, the movers tried to put forward a narrow-based solution.
The Government have listened to this debate and those that went before, and we have reflected carefully on the points raised. We have held many meetings with interested stakeholders and NGOs over the past months, and the Government are fully aware of the strength of feeling on this issue. I have looked again at the evidence that has been presented, including reports by Professor Rachael Mulheron of the University of London and Mr Smith of First Assist. Both reports make the general case for recoverable success fees and insurance premiums to continue in these cases, but they do not present any figures showing why these cases could not be brought in future. During our discussions with the NGOs we have asked for such evidence but it has not been forthcoming, even though we have asked them for more detailed figures.
The truth is that the available evidence shows that these cases, though few in number—about 10 in a decade—have historically been highly profitable for the legal firms involved. Although under our plans the margins available would be reduced, they are still likely to remain attractive. I remind noble Lords of the sums involved. Since the previous Government introduced the recoverability of success fees and insurance premiums in 2000, we know that there have been only around 10 of these cases, mainly undertaken by a single firm of solicitors. Most of these cases have succeeded or settled, but some claims have been pursued in which costs have not ultimately been recovered. The figures suggest that in those cases that were not pursued to trial, there were disbursements of some £131,000 and legal costs in the region of £1.4 million. I appreciate that those figures will not cover all costs in all cases but they should be a fair ball-park indication. £1.4 million sounds like a lot of money for a firm to bear in what are effectively losses on a case not pursued and won until the substantial sums that have been received in success fees are considered. We know that in the case of Trafigura alone, success fees—intended to cover the costs in lost cases—of around £29 million were allowed by the Court of Appeal. Those figures amount to a net gain for claimant lawyers from these cases over the past decade of more than £27 million from the success fees for Trafigura alone. That does not include all the success fees in the other successful cases.
These figures speak for themselves. They cast all emotion aside and demonstrate the substantial gains in legal costs from these cases and the proportionately much lower costs expended. When the ratio of earnings to losses is more than 10:1, the current system can, to put it mildly, bear some reform. Therefore, while I recognise that claims against multinationals can be complex, the changes that we are making to the CFA regime will not prevent these cases being brought in the future. They can still be brought but the costs will be more proportionate. As Lord Justice Jackson recognised, a greater incentive for claimants’ lawyers to work more smartly is needed so that they incur only costs that are justified when bringing a claim, rather than allowing costs to escalate.
It is worth pointing out, as I have previously in the House, the criticism by the Court of Appeal of the costs claimed by the claimants in the Trafigura case. In that case, the court itself questioned whether some of the work undertaken by the claimants’ lawyers was necessary. It criticised them for seeking costs of £100 million in a case that resulted in payment of £30 million in damages. It is not for me to question the conduct of those involved, but it needs to be borne in mind when looking at the extraordinary costs claimed in that case alone. I should add—again, as I have pointed out to the House previously—that in that case the defendant’s costs were approximately £14 million, which is around one-seventh of the costs claimed by the claimants.
I turn now to Amendment 27, which seeks to allow for the recoverability of “after the event” insurance premiums to pay adverse legal costs, including expert fees and other disbursements. In doing so, the amendment goes much wider than just the cost of funding the expert reports for which we have provided in the special situation of clinical negligence cases. The amendment would potentially cover paying the other side’s costs, too, but this is not necessary because we are introducing a system of qualified one-way cost shifting in personal injury cases, which will protect losing claimants from having to pay the other side’s costs. We have discussed making exceptions in relation to expert reports in other contexts, but we do not believe that an exception is more needed here than in other cases. As I have said, the costs recovered in successful multinational cases have been substantial and could provide funds towards paying up front for reports where needed.
As I indicated on Report, on several occasions my officials and I have met representatives of the NGOs that support these cases. However, we have not been persuaded that such cases cannot continue to be brought when our changes are implemented. Nor are we persuaded that they justify an exception in the Bill that would be unfair to other, no less deserving claimants.
The House will be aware of all the arguments that I have rehearsed today, in Committee and on Report. We have treated subsequent discussions with the seriousness they deserve, and we have listened carefully. However, the Government continue to believe that reform is unavoidable, necessary and overdue. In this case in particular, we should not mix up a challenge to overgenerous costs with a denial of access to justice. Access to justice is precisely what the reformed CFA regime will protect, but as part of a more proportionate and balanced system. Therefore, I urge the noble Baroness to withdraw her amendment.
Lord Beecham
My Lords, the Opposition certainly support the amendment moved by the noble Lord, Lord Pannick, in his customary and eminently reasonable way. He clearly draws the analogy between the changes that the Government, to their credit, accepted in relation to legal aid and what is being advocated here. It adopts the precautionary principle whereby if things went wrong—they may not of course—there would be a fairly simple way of correcting them if the amendment were to be accepted. If it is not accepted, we would presumably be in for a long delay while primary legislation was enacted, as both noble Lords have made clear.
In this case, discretion is the better part of legislative valour, and I hope that the Government will accept the amendment. It does not bind them to anything but provides an opportunity for corrective measures to be taken, if that should prove necessary, in precisely the same way that they have accepted in relation to legal aid.
Lord McNally
My Lords, the noble Lord, Lord Pannick, has tabled his amendment along the lines he suggested on Report. He suggested then that it might be sensible to have a power to disapply the effects of Part 2 in relation to the abolition of recoverability of success fees and insurance premiums in respect of particular categories of case. The amendment now seeks to achieve that.
I have referred on several occasions during the passage of the Bill to its central architecture. The Government’s view, quite simply, is that the current recoverability regime is wrong in principle. It is wrong in principle to impose substantial additional costs on losing parties, whether in relation to success fees or insurance premiums. Those costs add to the already significant costs of civil litigation and allow for risk-free litigation by claimants and what I earlier described as inflation in our legal system.
I have explained the rationale for our proposals and why we consider that they should apply across the board without exception, and I do not propose to repeat those arguments now. The amendment seeks to allow different recoverability in different classes of case. We are implementing a package of reforms, not all of which are contained in the Bill. This package has been carefully put together to be fair between claimants and defendants.
I understand the noble Lord’s intentions. I understand that he thinks it sensible to allow for exceptions to be made at a later date. However, we are legislating now on what we consider to be a fair and overdue basis. Funding arrangements need a degree of certainty. Claimants and defendants need to be able to plan and adapt to the new regime. The amendment would only create uncertainty. Will an exception be created? For what and when? Rather than settling the issue of CFAs, as this Bill seeks to do, the amendment would open the door to constant campaigning and calls for individual exceptions. The amendment may be well intentioned but it is fraught with difficulty. It would provide uncertainty and confusion where we are seeking to introduce clarity. It would provide increased costs where we are seeking to reduce costs. It is wrong in principle and unnecessary. I urge the noble Lord to withdraw it.
Lord Pannick
My Lords, I am grateful to noble Lords who have spoken in the debate. I simply do not understand how the amendment undermines certainty any more than does the equivalent provision in Part 1. I repeat that it would simply confer a discretionary power on the Lord Chancellor. I understand that the Government believe that the architecture in Part 2 is correct, but the Minister should accept that experience may show that in some contexts, the architecture does not work. The amendment would, importantly, ensure that if those concerns prove to be justified, the Lord Chancellor will have a power to do something about it.
This is an important matter. I wish to test the opinion of the House.
Lord McNally
My Lords, my noble friend is catching something that perhaps I should not call Pannick disease. The noble Lord, Lord Pannick, has a habit of asking questions and then giving the answers. We will have to see whether I will be able to satisfy my noble friend on the questions that he raised.
As I explained, the basic rationale for the proposed reforms to no-win no-fee conditional fee agreements is to squeeze the inflation out of our legal system. It is to rebalance the system to make it fairer as between claimants and defendants. They do this by correcting the anomaly whereby those who bring cases have no incentive to keep an eye on the legal costs. Right now, the recoverability of success fees and insurance premiums from the losing side can have the perverse effect of preventing defendants fighting cases, even when they know they are in the right, for fear of the disproportionate legal costs involved if they were to lose.
High and disproportionate costs have a negative impact not just because they can deny access to justice but more broadly because they can lead people to change their behaviour in damaging ways because of the fear of claims. Nowhere is that more true than in relation to responsible journalism, as well as to academic and scientific debate. The judgment of the European Court of Human Rights, to which my noble friend Lord Lester referred, in January 2011 in Mirror Group Newspapers v the UK—the so-called Naomi Campbell case—found the existing CFA arrangements with recoverability in that instance to be contrary to freedom of expression under Article 10 of the convention. Editors and journalists have long warned of the chilling effect of the current libel regime and argued that part of the problem is the huge costs that no-win no-fee cases impose. However, defendants are not always rich and powerful newspapers; they are also scientists, NGOs, campaigners and academics.
I have already made the general argument that any exception to reforms intended by Lord Justice Jackson to apply across the board is invidious and likely to lead to unfair anomalies with special treatment for some areas of law but not others. In the case of defamation, I additionally argue that these amendments are premature because, as the noble Lord, Lord Lester, explained, these issues need to be considered in the context of the defamation Bill, which we aim to introduce as soon as a legislative opportunity arises.
Lord McNally
The noble Lord will have to wait and see. One thing is certainly true: I have made every effort to make sure that defamation is not engulfed in a tsunami from Leveson. If we really want to reform defamation and not get caught up in a much wider privacy law, what I am trying to do is the way forward. Stunts like dividing the House tonight will show that, on this Bill, the noble Lord is still more interested in short-term political gain than in making progress.
Lord Thomas of Gresford
As a member of the committee that has just reported, I should remind the noble Lord that it advised against a privacy law.
Baroness O'Neill of Bengarve
Before the Minister finishes winding, will he explain to the House why he does not think that these exemptions—the noble Lord, Lord Lester, may be entirely right—are the right way to go? Does he not think that two successive changes in the regime are the very worst thing for litigants in this area? In so far as we are leaving the Bill as it is, one change will happen now and another will happen down the road if there is legislation on defamation.
Lord McNally
We are talking about a Bill that does not come into effect until 2013. Given that defamation legislation is in process, I do not think the fact that there is a slight lacuna is a major problem in terms of the issues that the Bill will deal with. If it takes a little longer, that is a problem, and I will return to that.
That Bill and associated measures seek to reduce the costs of litigation and discourage unnecessary litigation in the area of defamation. We seek to do so, very broadly, by introducing a range of substantive and procedural changes and also by focusing on alternative dispute resolution, which is quicker, at lower cost, and offers more meaningful redress.
Any exceptions for defamation or privacy cases from the changes in Part 2 are unnecessary because our CFA reforms should not prevent strong cases being brought. I share the concern that individuals who are not wealthy or powerful sometimes need to bring defamation or privacy cases. Nothing in our proposals should prevent that where a case is a good one.
The noble Lord, Lord Bach, sometimes makes me gasp when he starts lecturing our Benches on consistency. The noble Lord, Lord Prescott, asked why this was happening now. Perhaps I may quote an expert on these matters:
“CFAs will remain available for defamation cases; thereby, lawyers will still be able to use them in deserving cases”.—[Official Report, 25/3/10; col. 1157.]
Those were the words of the noble Lord, Lord Bach, as Justice Minister, when he rushed attempts to reduce success fees before this House just before the election. We have already heard what happened in the grand coalition that was the Labour Government when the proposal went down the other end. Nevertheless, the noble Lord, Lord Bach, told this House:
“There is a substantial body of opinion that 100 per cent recoverable success fees should not continue in defamation cases”.—[Official Report, 25/3/10; col. 1156.]
He was backed up by a consultation which said,
“immediate steps are needed in respect of defamation proceedings”.
Lord Bach
My Lords, I stand by those remarks. If the Minister thinks that there is something wrong—for example, the difficulty in relation to damages where, under his Government’s scheme, claimants will have to pay up to 25 per cent of the damages they get—what is he going to do to change that? He is in government now.
Lord McNally
We are doing what they did not do. We are bringing forward a Defamation Bill that will address many of these problems. The noble Lord says that he does not know what is in the Defamation Bill. A Defamation Bill was brought into this House by my noble friend Lord Lester two years ago, when this Government first came in. In reply to that, I said from this Dispatch Box that we would take up this Bill. We went into a consultation, which has been published. We produced a draft Bill, which the noble Lord may have noticed. We also had pre-legislative scrutiny under the chairmanship of the noble Lord, Lord Mawhinney, and we have responded to that.
We have played this by the book. We have not tried to rush through legislation, as the noble Lord did in the dying days of his Government. We have carried out a sensible look at defamation. The noble Lord knows the conventions. I am very hopeful that we will find parliamentary time in the very near future.
As I have already said, the legislation in this Bill does not come into effect until 2013. The Defamation Bill and the procedural reforms that we intend to take forward with it are of course about reducing the complexity and therefore the expense involved. In order for those aims to be achieved, we will look at the rules on costs protection for defamation and privacy proceedings for when the defamation reforms come into effect. I can give the House the assurance that we will do so. Bearing that in mind, I hope that the noble Lord will withdraw these amendments. We are on course for a reform of our defamation laws.
Lord Lester of Herne Hill
My noble friend the Minister accused me of asking questions to which I knew the answer, but this question I do not know the answer to. Is the Minister saying that there will be adequate powers, either under existing law or the future legislation, to create any cost changes that are needed to secure a level playing field and equality of arms? If that is what he is saying, I am completely satisfied.
Lord McNally
That is precisely what I am saying. I have not brought this Bill this far to score such an enormous own goal. Noble Lords, particularly those who have been in government, know full well how these processes are carried forward. Nothing will happen that will not be fully and thoroughly debated in both Houses of Parliament. I know that various groups have been briefing and arguing for action now. I do not think that these amendments carry us forward in any way.
I give noble Lords as full an assurance as I can. Bills have to go through Cabinets and Cabinet committees, et cetera, but they also have to go through two Houses of Parliament, where this issue is extremely live. I cannot imagine that the kind of issues that the noble Lord, Lord Prescott, has raised tonight will not be dealt with fully in that Defamation Bill. With that, I urge the noble Lord to withdraw his amendment.
Lord Prescott
I certainly do not withdraw the amendment and I hope that the House will vote on it.
Lord McNally
“( ) the legal services relate to any other claim or potential claim for damages arising out of circumstances involving personal injury or death,”
Lord McNally
My Lords, I committed on Report to bring back at Third Reading amendments to address issues raised by my noble friend Lord Hunt of Wirral in respect of Clause 57. Amendment 29 addresses situations where the referral fee for an ancillary claim, such as for damage to a motor vehicle involved in a road traffic accident, in addition to a personal injury claim, may be inflated to include a payment for a referral fee for the personal injury claim. Amendment 30 makes it clear in the Bill that the payment of referral fees to a third party, whether or not they are regulated, will not avoid the prohibition on the payment of referral fees. This gives both practitioners and regulators a clear marker and removes doubt as to the effect of the clause. We do not wish to place additional burdens on regulators and these amendments will remove the potential for confusion on what is and what is not covered by the ban.
I wish to put on record my thanks to my noble friend for tabling his amendments, which have enabled the Government to strengthen and clarify the ban on referral fees in personal injury cases. I beg to move.
Lord Hunt of Wirral
My Lords, I thank the Minister and declare my interest as a partner in the international commercial law firm, DAC Beachcroft LLP, and my other interests in the register.
I warmly applaud the coalition Government’s intention to ban referral fees in personal injury cases. The amendments establish greater clarity around the operation of the ban on referral fees to ensure that there must be no side-stepping of the intention to ban them. I thank him warmly for bringing forward these amendments at Third Reading.
Lord McNally
Lord Beecham
My Lords, from the opposition Front Bench I strongly support the amendment moved by the noble and learned Lord. I do so not just because he was a distinguished judge and a most eminent Lord Chief Justice, whose words should be weighed very carefully by all sides of this House; not even because he is a fellow Novocastrian and a fellow honorary freeman of Newcastle-upon-Tyne; but because what he proposes makes such eminent sense, as several of your Lordships have pointed out. The record of restorative justice is one of success. It is not universally successful but, as we have heard, it has made a significant impact on reoffending rates, is cost-effective and, as the noble Lord, Lord Ramsbotham, pointed out, is an alternative to other forms of punishment that are generally more expensive and often less efficacious.
I cannot think of any reason why the Government should resist an amendment phrased in the way that this is. There is an analogous process called “justice reinvestment”, which is a rather more collective way of making reparation, whereby offenders put something back into the community through a community payback scheme or something of that kind. Justice reinvestment is not part of this amendment, although it is a valuable process. If the Government reject the amendment, we will not see justice reinvestment but, in effect, justice disinvestment. That would be a mistake, from which only the victims of crime—and the taxpayer, for that matter—would suffer.
I hope that the Minister, when she replies, will see the enormous persuasive logic of the case made by the noble and learned Lord, supported as it has been on all sides of the House. I hope that the Government will recognise that to incorporate an amendment of the kind that the noble and learned Lord has moved will strengthen, not weaken, the Bill. I hope that they are prepared on this occasion, as they have been on other occasions, to listen to the sense of the House and accept the amendment.
Baroness Northover
My Lords, Amendment 31, tabled by the noble and learned Lord, Lord Woolf, returns to restorative justice. I thank him for bringing this important issue before the House and for his tenacious support for its principle.
The amendment is very timely as this morning we published our consultation on community sentences, Punishment and Reform: Effective Community Sentences, which includes a chapter on reparation and restoration. I am very pleased that the noble and learned Lord has welcomed this publication. The consultation offers us an important opportunity to seek the views of practitioners, sentencers, magistrates, probation officials, victims and victims’ groups about the use of restorative justice as part of our response to tackling more serious offending through the use of community sentences. It asks questions about the use of pre-sentence and post-sentence restorative justice, what more we can do to strengthen and support the role of victims in RJ and, crucially, what might be the right approaches to building capacity and capability and boosting a cultural change for RJ. We want to gather all views on how to do this, and through what means, so that we can develop the most effective approach. Noble Lords have emphasised their experiences of how restorative justice works and have cited research to back up those experiences.
We are anxious to ensure that innovative and effective restorative practices continue to be developed and are driven by local areas and tailored to local need. We certainly want to support initiatives by building capacity in the criminal justice system so that we can deliver the restorative process that this amendment champions. I believe, therefore, that we need to undertake the important consultation exercise that we have initiated today before we can give consideration to whether further specific legislation is necessary for restorative justice, taking into account all the options for how we intend to widen its application.
Noble Lords have made a very powerful case for the use of RJ. My honourable friend in the other place Crispin Blunt, my noble friend Lord McNally and I very much welcomed the meeting that took place earlier today, to which the noble and learned Lord has referred. I hope that it reassured him that we are making progress in this area to increase the use of restorative justice across the criminal justice system. We hope that he will contribute his enormous wisdom and experience to the consultation that we launched today. I assure noble Lords that everything that they have said will be fed into that consultation process and what emerges from it.
Baroness Butler-Sloss
I apologise for interrupting the noble Baroness but she has got to a point where I need to ask a question. Here is a vehicle of primary legislation into which something about restorative justice can be placed. If she and the Government wait for the results of the consultation, where on earth will they find the vehicle of primary legislation into which to slot restorative justice?
Baroness Northover
I think that I am being invited to comment on what might be in the Queen’s Speech, as was my noble friend. That is way above my pay grade.
Baroness Butler-Sloss
I merely wanted to say that here is a piece of legislation into which this measure can be placed. However, if it is not included in this legislation, there is a danger that it will not go in anywhere. In the absence of primary legislation, there is a danger that the Government will have difficulty in implementing the measure. That is the point I am making; I was not trying to get an idea of what is in the Queen’s Speech.
Baroness Northover
I understand what the noble and learned Baroness is saying. As we discussed in Committee and on Report, the use of restorative justice can already be taken forward under current legislation. The question is whether further legislation is required. The noble and learned Lord and other noble Lords have made the case that restorative justice is useful, as has the noble and learned Baroness. However, as I say, RJ can already be taken forward and is being developed. We hope—
Lord Woolf
Perhaps the noble Baroness will forgive me for also interrupting her, but I should like her assistance. Am I right in assuming that she intends restorative justice still to be supported by the courts? Does she agree that there is no express reference to restorative justice in legislation setting out the power of the courts to make use of it? Although there are references to similar matters, they do not clearly permit restorative justice.
Baroness Northover
I hear what the noble and learned Lord says, and he makes his case very cogently, as he and others have done at other stages. However, he, too, will recognise that the courts can use restorative justice and are doing so. That is happening. However, the Government take seriously the need to develop this area further, and noble Lords have made that case very clearly. The consultation has been brought forward. We expect that what has been said here will be fed into that consultation, and I hope that the noble and learned Lord will feed his own experience and expertise into that process. The important thing here is to make sure that the practice is taken forward and provision is expanded. That commitment I can certainly give him. Given the consultation and the process that is being carried forward, I hope that he will withdraw his amendment but continue with his commitment, which we very much support.
Lord Woolf
I thank the Minister for the way in which she presented her case. She has said everything possible to support deferring the inclusion of the reference to restorative justice, which I think is important because it makes it clear to judges up and down the land that restorative justice is part of the purposes of sentencing. That message can then be incorporated into the process.
I thank the noble Lord, Lord Hodgson, for his helpful remarks. He was obviously concerned about resources. In the present situation, everyone is concerned about resources. The amendment does not require the Government to put one penny into restorative justice. It does not deal with that subject, so he need not have that concern.
I know that there is every probability that, if we do not do it now, one day this will be done, but this is an excellent opportunity to do it. There is no reason why we should not. With respect to the comments of the noble Baroness, I did not identify any reason why we should not, other than the fact that consultation is to take place, but consultation can go on irrespective of whether or not we do this. We all support the consultation process. In those circumstances, albeit that the hour is late and that we have had a long day on the Bill, I propose to divide the House.
Lord Beecham
My Lords, the noble Baroness makes a persuasive case to encourage the Government to invest not money but a modest degree of guidance to assist the process of magistrates effectively learning more about sentencing options, about what happens when they institute different forms of punishment and about what happens, in particular, in relation to community sentencing. This is not a huge burden. When one thinks of some of the legislation that has passed through your Lordships’ House in recent months —a Localism Act that with its impact analysis weighed in at something over 8 pounds, as I recall, and contained 225 clauses, a health Bill that had 1,000 amendments en route to your Lordships’ House and all the rest of it—one cannot imagine that it would take very much effort on the part of those responsible to produce fairly simple guidelines on a very narrow topic, which is the subject of this amendment, that could facilitate greater awareness of what is available to magistrates in terms of sentencing options. It seems to me an overwhelmingly simple matter and one that the Government could graciously concede without any damage to the Bill. On the contrary, it would enhance the intentions of the Bill and the intentions of government policy, to which we have referred and which, no doubt, we will shortly hear again from the Minister. Along with the noble Baroness and the noble Lord, Lord Ramsbotham, I would be at a loss to understand what could possibly persuade the Government that this is not a simple and desirable course to follow. I hope that the Minister will not feel that she is constrained to remain rigid on the position that has hitherto been adopted, which produces nothing to assist magistrates or, indeed, anybody else.
Baroness Northover
My Lords, this amendment returns to the issue raised by my noble friend Lady Linklater throughout the passage of the Bill. As I said on Report, my noble friend Lady Linklater has considerable experience of bringing together magistrates and those working in probation and of building trust in alternatives to custodial sentences. That is the key area here. That is exceedingly important. We agree with my noble friend about the merits of what she is trying to achieve. However, we do not feel that there is need for legislation to reach that goal. It is interesting that the noble Lord, Lord Beecham, talks about guidance.
As I said on Report, we will look to promote best practice on liaison and information sharing and to make clear that there are already arrangements available for magistrates to claim expenses from probation trusts to encourage such close liaison. We have already begun that process. The national sentencer probation forum has agreed to look at this issue. That forum brings sentencers, including magistrates, together with probation trusts and Ministry of Justice officials to discuss national issues of common interests, including liaison arrangements. We want to gather from sentencers and probation trusts any issues of which they are aware in relation to local liaison arrangements, along with examples of good practice in information sharing. I am pleased to say that the forum has agreed to consider these issues at a forthcoming meeting. I hope that my noble friend is reassured by that. It may be that as a result of that examination of the issues, it emerges that there is indeed a need for guidance in the way that the noble Lord, Lord Beecham, indicated, or some other clarification of existing procedures. However, I stress again that there is no need for new primary legislation to enable that to happen.
Lord McNally
“(9) In Schedule 9 to that Act (transfer of community orders to Scotland or Northern Ireland)—
(a) in paragraph 1(5), after “require” insert “an alcohol abstinence and monitoring requirement or”, and(b) in paragraph 3, after sub-paragraph (4) insert—“(4A) The court may not by virtue of sub-paragraph (1) or (3) require an alcohol abstinence and monitoring requirement to be complied with in Northern Ireland.” (10) In Schedule 13 to that Act (transfer of suspended sentence orders to Scotland or Northern Ireland—
(a) in paragraph 1(5), after “require” insert “an alcohol abstinence and monitoring requirement or”, and(b) in paragraph 6, after sub-paragraph (4) insert—“(4A) The court may not by virtue of sub-paragraph (1) or (3) require an alcohol abstinence and monitoring requirement to be complied with in Northern Ireland.”(11) In the Armed Forces Act 2006—
(a) in section 180 (transfer of service community order to Scotland or Northern Ireland), in subsection (2), after “3(1)” insert “and (4A)”, and(b) in section 204 (transfer of suspended sentence order to Scotland or Northern Ireland), in subsection (2), for “6(5)” substitute “6(4A) and (5)”.”
Lord McNally
My Lords, Amendments 33, 34, 35, 42 and 43 are minor and technical consequential amendments, which provide clarification of the provision of the alcohol, abstinence and monitoring requirement introduced by an amendment on Report. Our intention is that new requirements should be available to the courts in England and Wales but not to the courts in Scotland or Northern Ireland. The amendment therefore ensures that the new requirement will not be capable of being imposed by a court in England and Wales on a person who is resident in Scotland or Northern Ireland. I beg to move.
Baroness Finlay of Llandaff
My Lords, I welcome these amendments. I am grateful to the Government for addressing an area that I overlooked in the amendments that I had drafted. I also should like to place on record my gratitude to the noble Baroness, Lady Northover, who, with me, met the domestic violence groups, as we had promised in the previous proceedings. We had a very useful and fruitful meeting with open discussion. At the end, everyone agreed that it was very clear that there was never any intention that the pilots should involve domestic violence, particularly not at the beginning, because the issues around domestic violence are so complex. The organisations involved in domestic violence very much want to be consulted at every stage of further development and the programmes in place to help people cope in situations of domestic violence are very important in trying to provide a safer and more stable society.
Lord McNally
(a) ”
Lord Bach
My Lords, the House will be delighted to hear that I intend to be brief. It owes a huge debt of thanks to the noble Baroness, Lady Miller, for having persistently come back with her amendments on this absurd clause, which, as the noble Lord who has just spoken said, does not fit in. “Cuckoo in the nest” is a polite way of putting it. The clause does not fit into the Bill at all and makes one wonder why on earth the Government ever included it.
If the noble Baroness were to test the opinion of the House, we, the official Opposition, would support her because she is clearly right. Everyone who has spoken on the substance of these amendments has said that the current clause is unsatisfactory, wrong and completely unnecessary. Why is it there? There is no need for it to be there in terms of criminal offence. We have heard from the noble Lord, Lord Elystan-Morgan, and others that legislation already exists that covers the point completely. The clause is there to placate the right-wing press and right-wing prejudice. That is something that the House should bear very much in mind when considering this issue.
The Law Society, the Bar Council, ACPO and the Metropolitan Police—all those groups who have had the courage to speak out, as has the noble Baroness against the clause—are not exactly groups associated with squatters. They are independent, able groups that have come to a view about a brand-new criminal offence that is planned. Unless we do something about it this evening, it will almost certainly become law comparatively shortly.
The irony of our proceedings is that if the noble Baroness were to test the opinion of the House this evening, it would very likely be her own side who made sure that she did not win.
Baroness Northover
My Lords, at Report, I explained the role of the new squatting offence in giving greater protection to owners and occupiers of residential property who encounter squatters living in their properties. Various noble Lords have asked whether that is needed. Interestingly, only yesterday I received a letter from the deputy leader of the London Borough of Redbridge. He states:
“In one recent case in Ilford, a house owned by someone who had died became a squat during the eighteen months it was taking for lawyers to resolve her estate. In a second case a homeowner was no longer able to manage their own affairs and had been taken into care. In neither case was there an ‘owner’ able … to address the problem”.
The noble Lord is quite right to say that there is protection for a level of squatting, but, as I explained at Report and put in a letter, so I will not go into it again, the provision covers a number of additional areas where it is difficult to deal with squatters.
I know that many noble Lords, especially my noble friend Lady Miller, are concerned about the impact that a new offence might have on vulnerable people who squat. I thank my noble friend for meeting me last week, and my noble friend and my noble friend Lady Hamwee for meeting my honourable friend Crispin Blunt, my noble friend Lord McNally and me earlier today. Then and at the earlier meeting, my noble friend Lady Miller expressed concern about the possibility of a rise in demand for local authority homelessness services when the new offence comes into force.
We have already given assurances on the Floor of the House that we will work closely with the Department for Communities and Local Government to liaise with local authorities and the enforcement agencies prior to commencement to ensure that they are aware of the new offence. That is extremely important. We take very seriously mitigating any problems and we share my noble friend’s concern about the welfare of vulnerable people. However, allowing squatting to continue, sometimes in dangerous and unhealthy premises, cannot be the answer. Instead, we intend to continue to work with other departments, local authorities and homelessness services to ensure that vulnerable people are given the help and support they need to find alternative forms of accommodation.
Of course, as the noble Baroness, Lady Lister, emphasised, a number of those in that situation are suffering from mental or other problems. We have an obligation to them, as vulnerable members of society, to be properly housed. In squats, they have no protection. That cannot be right. The Government have already demonstrated our commitment to preventing homelessness by maintaining investment, with £400 million available over the next four years. We recognise the issues that single homeless people, in particular, face, and we are prioritising improvements in the help that they receive. The ministerial working group on homelessness has for the first time pledged that no one should spend more than one night out on our streets, supported by the new £20 million homelessness transition fund. The working group will publish its second report on preventing homelessness more broadly later in the spring.
Baroness Lister of Burtersett
Will the Minister answer my question? Will the transition fund be ring-fenced?
Baroness Northover
Most of the money that goes to local authorities is not ring-fenced. The emphasis is on devolving to local authorities the responsibility for the people in the area. Given the lateness of the hour, I am very happy to write to the noble Baroness more specifically on that point if I have not got it right. I do not think that the money would be ring-fenced but, if I am wrong about that, I shall correct it in a minute or write to her. Nevertheless, that money has been identified to provide funding to address homelessness.
Baroness Northover
There is an ongoing debate about what you ring-fence and what you leave as the responsibility of local authorities. If you give them a responsibility to house their vulnerable local residents—or non-residents—they have to fulfil that obligation. It seems that a bit of clarity of thought is needed here. It is not appropriate to place the responsibility for a squatter on the shoulders of an individual who happens to have an empty property. If that person is well off, he should be paying his taxes, those taxes should go to society and society should look after its vulnerable people. Squatting is not the answer; nor is placing such a responsibility on the shoulders of an individual in that way. That is why it is important that we address squatting but, when a problem such as this is picked up, it is also important that we address the transition issues that my noble friend rightly identified. It is important to see what the implications are and that is why we have placed the emphasis on tackling homelessness. As I said, we have announced the first ever £20 million—
Lord Strasburger
I thank the Minister for giving way. Did I hear her argue earlier that one motivation for this clause is to improve the health and safety of squatters?
Baroness Northover
Yes, I would say so. I do not think it is right that people should live unprotected. For example, the noble Baroness, Lady Finlay, flags up monitors for heating systems and the dangers involved there. How can anybody be protected or have tenants’ rights if they are squatting? I think we owe it to our citizens to make sure that they are housed properly and that they do not live without that kind of protection, as is the case with squatting. Perhaps I may continue.
On preparing local authorities for commencement, we plan to do a range of things, including working with the National Homelessness Advice Service to provide training for local authorities, raising awareness through regional seminars and websites, and working with Citizens Advice to ensure that home owners and squatters are informed of the changes.
One or two noble Lords asked about the consultation. The vast majority of responses—1,990 out of 2,216—were received via the website of the campaign group Squatters’ Action for Secure Homes. That is fair enough. However, the remainder came from landlords’ associations, local government associations, law firms and so on. We also received responses from individual property owners who had first-hand experience of squatters in their buildings. I have just mentioned the letter that I received yesterday from the deputy leader of Redbridge Council which referred to a couple of cases and the impact on the areas involved.
I was asked by my noble Friend, Lady Hamwee, whether squatters who vacate their squats will be considered intentionally homeless. That is obviously a very important point. Section 191 of the Housing Act 1996 provides that a person becomes homeless intentionally if it is a consequence of something that he or she has deliberately done or failed to do. The accommodation that he or she has left must have been available for their occupation and reasonable for them to continue to occupy. Therefore, it is unlikely that a squat being occupied illegally could be considered as accommodation that is available to be occupied. I hope that my noble Friend is reassured on that point.
I was also asked about whether we could commit to working with Crisis, and we certainly will. We will involve Crisis when we are liaising with the local government department and local authorities on the implementation of the offence. It is very important that that is taken forward. I was asked about the empty dwelling management orders. In January 2011 the Government announced that we would be making changes to those orders. These proposals will limit the authorisation of interim EDMOs to those properties that have been wholly empty for at least two years. They will require local housing authorities to give property owners a minimum notice period of three months before applying to a residential property tribunal for an interim EDMO. They also require the local housing authority to provide all the information that it has on the empty property that is causing a nuisance to the community, and that the community supports the proposal for the local housing authority to take control.
I was asked by my noble friend Lady Hamwee about guidance for the police and the CPS. We will liaise with ACPO prior to commencement on the provision of appropriate guidance, including how the new offence will interact with existing offences in Section 7 of the Criminal Law Act 1977. There were various other points but I shall move on to Amendment 36 and the point about occupying buildings that have been left empty for a year or so.
As I explained, this amendment is problematic for a number of reasons. I explained this on Report and in my letter. There are many reasons why a residential building might be left empty for a year or more, and I have just referred to the letter from Redbridge. Clearly, if a property is inherited following a death or probate is taking a while to sort out, those kinds of issues may mean that a property is empty. Reference was made by my noble friends Lady Miller and Lady Hamwee to the definition of a building. I note that my noble friend has proposed a definition that would sit alongside the current definition in the Bill. We are concerned that that would introduce unnecessary confusion and complexity. We talked about this at our meeting this morning. I am happy to expand on that if required but it is five minutes to 11, so unless noble Lords want to come back to that, I urge them to accept the simplicity of what is there at the moment, which is the right way to go.
I commend my noble friend for her concern for a very vulnerable group of people. As I have just said, it is important to look at this with some clarity in terms of the social responsibility to individuals and how society should ensure that the vulnerable are cared for and housed properly, and that squatting is not the answer. I understand why my noble friend has tabled the amendments and her concerns about unintended consequences of legislation. I hope that she is reassured that we have looked very carefully at the issues that she has raised and that we have sought to address them, in terms of assisting vulnerable people. I therefore hope that she will be willing to withdraw her amendment.
Baroness Miller of Chilthorne Domer
My Lords, I am tremendously grateful to all Members of the House who spoke in this debate—which finally had the airing that it deserved, even though it was late—and to all Members of the House who stayed to hear it. It was an incredibly important debate about whether we should choose to criminalise a section of society. Many extremely good points were made and I will not rehearse them all at this hour. One theme that ran through all the speeches was that of unintended consequences.
I entirely agree with my noble friend that it is society’s responsibility to look after the vulnerable—and, I would add, the homeless. That responsibility does not include criminalising them; that is where we part company. However, I see that Amendment 36 is problematic, and I accept the criticisms around the definition of “residential”. We were trying to offer something that was slightly better than what was in the Bill.
Noble Lords concentrated on the issue of what people will do. As my noble friend Lady Hamwee said, the housing is not there and cannot be created in an instant. Therefore, there will be a group of people who will face very difficult decisions about whether to stay in a squat and be criminalised, to sleep rough or to present themselves to their local authority. We keep coming back to the issue of local authorities and consultation. I think that the Minister accepted that consultation with local authorities was the key. The House would feel very reassured if that were put in the Bill.
While accepting that my other amendments are faulty, I will seek in due course to test the opinion of the House on Amendment 41. In the mean time, I beg leave to withdraw Amendment 36.
The Minister of State, Home Office (Lord Henley)
My Lords, it might be useful if I intervene now because there are a number of misconceptions about what is going on. Perhaps I may say that I rather regret the words of the noble Lord, Lord Campbell-Savours, for whom I have the utmost respect, because he implies that whatever I say, I am out of touch and do not know what is going on. He seems to suggest that what I say will be untrue. That is not the case. What I would ask of your Lordships is that—dare I say it?—they should listen to me very carefully because I think I can allay the fears and answer the questions that have quite rightly been put by the noble Lord, Lord Faulkner, and my noble friend Lord Jenkin about the problems we are facing and where we are on this issue.
I start by paying tribute to the noble Lord, Lord Faulkner, who was the first person to suggest that we should go down the cashless route. That is what we are doing, and he was the first to spot that there was a chance to do so in this legislation. It is why we are doing that and a few more things in this Bill, but the other things will have to wait until suitable legislation comes through. There is no five-year review, as the noble Lord, Lord Campbell-Savours, puts it. We have said that we will come to the other bits as and when we can, at which point we will resolve those matters. Again, at this stage I would ask noble Lords to listen to me very carefully as I explain what we are going to do.
Your Lordships will be aware that we tabled amendments on Report proposing three legislative measures to tackle metal theft: greater fines for offences under the Scrap Metal Dealers Act 1964; creating an offence of buying scrap metal for cash, and a revision of police entry powers to help enforce the new offence because it is important to make sure that we get the enforcement right. A similar amendment to the one we are dealing with tonight was tabled by the noble Lord, Lord Faulkner, but his revised amendment seeks to remove the existing exemption that allows certain itinerant collectors to be exempted from the cashless offence. I am going to deal with that in due course.
I should make it clear that anyone who trades in metal, whether they are a large multinational, the local scrap metal dealer or a door-to-door collector, which includes the itinerants, must register with their local authority under Section 1 of the Scrap Metal Dealers Act 1964. It might be that they do not register, in which case there are sanctions, but it is also why we are increasing the sanctions under an Act which I have said before is past its sell-by date. Failure to register is a criminal offence that under Clause 146 of this Bill will now be punishable by an unlimited fine. Anyone, be they an itinerant or a large multinational, who does not register can be punished with an unlimited fine. As part of its focus, the national metal theft task force, which we announced late last year, will ensure compliance with the registration requirement. I shall say a little more about enforcement later.
The police are currently able to enter and inspect any commercial premises that belong to a registered scrap metal dealer, including those used by itinerant collectors. Our amendment will ensure that they can also enter and search unregistered premises with a warrant if they have reasonable grounds to suspect that metal is being traded for cash, and being unregistered may well be relevant evidence in that regard, although obviously that is for magistrates to decide when they issue a warrant.
I do not suppose any of your Lordships who are in the Chamber did so, but when we debated the 1964 Act almost 50 years ago, Parliament chose not to overburden small businesses by including an exemption for door-to-door collectors from some bookkeeping. That is why the exemption was brought forward in that Act. As a result, in addition to the mandatory registration I have already mentioned, businesses can apply to their local authority for an order under Section 3(1) of the 1964 Act, to which my noble friend Lord Jenkin referred. That order would be granted by the local authority, but only in consultation with the chief officer of police for the police force area. Let me be clear: there is no blanket exemption for anyone who simply claims to be an itinerant collector. They have to be registered under Section 1 of the 1964 Act and they then have to get the exemption under Section 3(1) of the same Act, which has to be agreed by the local authority in agreement with the police.
The amendment that we have put forward follows the structure of the existing Act and the exemption is for a defined and locally known group of collectors to operate. So, if an itinerant was operating in a large number of different areas, he would need a Section 3(1) exemption from each local authority area in which he was operating. It is not a question of having one exemption and then being able to use that throughout the country. If he does not have that, he will be in breach of the law and could suffer the consequences.
It should also be noted that itinerant collectors who have obtained a Section 3(1) order are reliant, obviously, on selling their collected metal into the scrap metal industry. I appreciate that there are allegations that a lot of this metal goes into containers and is shipped abroad. We have no evidence of that—it does not appear to be happening—but if in the future we do see signs of metal going straight into containers and being shipped abroad, it will be easier to deal with because there are a limited number of container ports in the country compared to the vast number of scrap metal yards into which the metal is going at the moment.
On enforcement as we are seeing it on a day-to-day basis, the British Transport Police, as part of Operation Tornado—which is an operation into scrap metal theft in the north-east of England at the moment but which will be expanded in due course—encounter these collectors on a daily basis. On many occasions, the police find that they are unregistered and that they do not have a waste carrier’s licence, which they need if they wish to transport waste. As a result, they have had their scrap and, if it is not insured to carry waste or has not been registered to carry waste with the environment agencies, their vehicle confiscated. So there are enforcement procedures in place.
Registered collectors who have a reduced record-keeping requirement under Section 3(1) will, as I have said, still have to trade into the scrap metal industry. When they do so, they will not receive cash—they cannot receive cash—and that is what our amendment does.
So, to make it clear, Section 3(1) reduces the record-keeping requirements for those who only collect metal, but this is in addition to them also being registered under Section 1. It is not about signing up for one or the other, as some people imply, nor is it a matter of choice for the individual itinerant collector just to announce that he is now an itinerant collector. If he wants to be an itinerant collector he must be registered under Section 1 and under Section 3(1).
If the noble Lord’s amendment was to be successful and itinerant collectors with a Section 3(1) order are included, the offence of trading in cash would be more difficult to enforce for those individuals because of the nature of the work they do in travelling from street to street in the manner described by my noble friend.
To evidence compliance with the new cashless offence, we have strengthened the record-keeping requirements under Section 2 of the Scrap Metal Dealers Act which apply to the vast majority of the industry registered under the Act. We require that records are kept of who the payments are made to and the method of payment, and that receipts are copied and retained. The few collectors with a Section 3(1) order will not be required to keep those records. I cannot give a precise figure on the number of Section 3(1) itinerant dealers—that would mean going to every local authority in the country—but, of necessity, that figure will be relatively few. As I have made clear, they will have to be agreed to by the local authority with the agreement of the local chief of police.
To reassure the House further—
Lord Henley
No, I am not giving way to the noble Lord. It is entirely a matter for me to decide whether I give way to him.
To reassure the House further on this point, the Home Office is willing to work with the Local Government Association, with local authorities and with the police through ACPO, to help them provide advice to their members about the levels of assurance required in terms of identity, residence and any relevant criminal convictions before Section 3(1) orders are issued. That will ensure that they are operated in as tight a manner as possible.
I want to make clear—as I hope I did at Report—that banning cash from the scrap-metal industry is a vital first step to tackle metal theft and remove the drivers behind it. I think that the noble Lord, Lord Faulkner, is with me on that. However, it is part of a wider package of work to tackle metal theft, including better enforcement and seeking design solutions to make metal harder to steal and increase the possibility of it being traced.
I will say a little again about enforcement. As I have said, we have strengthened that with the dedicated metal theft task force. We have already seen very significant progress, not least in the north-east, where there is quite a large amount of metal theft. Since the launch of Operation Tornado at the start of the year in the three northern police forces—Northumbria, Cleveland and Durham—we have seen a 50 per cent decline in the amount of metal theft in that area. That is driven by the voluntary adoption by the scrap-metal industry—or at least a considerable part of it—of greater identification checks when purchasing metal. We did not get the agreement of all of them but we are getting a considerable amount; and with this legislation we will get considerably more. I am also pleased to let the House know that the Association of Chief Police Officers is rolling out Operation Tornado nationwide over the coming months. As I have said, that operation has seen a 50 per cent decline in theft.
This is not the loophole that some noble Lords believe it is. We are not proposing a blanket exemption, but are allowing a very small number of specifically registered itinerant collectors to continue to operate as they currently do. I close by letting—
Lord Campbell-Savours
The noble Lord talks about the “very small number” of itinerant collectors, which was at the heart of the speech by the noble Lord, Lord Jenkin of Roding. If there are so few in each local authority, why could a departmental official not have contacted each local authority and asked them whether it is two, three or half a dozen? That would not have taken huge resources at the department, particularly when it was at the very heart of the defence of the legislation being used by the Minister at the Dispatch Box, both last week and this week.
Lord Henley
The noble Lord will have seen many questions over the years coming back to him with the reply that they cannot be answered without disproportionate cost. I will look very carefully at what he has had to say but, looking at the regulations involved in those itinerants first registering under Section 1 and then getting the exemption under Section 3(1), it was not thought necessary to write to all 400 and whatever local authorities. I will have a look at whether it is possible but I do not think it is necessary. I want to—
Lord Henley
Perhaps the noble Lord could just calm down a bit. It is late at night and we are trying to answer this problem in an appropriate manner.
I want to end by reiterating that we are committed to reviewing the Scrap Metal Dealers Act as soon as parliamentary time allows. That is why I dismissed the idea that it could not be done in less than five years. When we do so, we will be looking very hard at the role and regulation of scrap-metal dealers and itinerant collectors. I want to repeat the point that all noble Lords ought to grasp. It is not true that itinerant collectors can come by their own whim—they must go through a local authority inspection process and one that requires the approval of the local police. That is the important matter.
I hope that the noble Lord, Lord Faulkner, will accept that the clarification I have given has dealt with the various questions he put to me and that he will be content to withdraw his amendment.
Lord Jenkin of Roding
One of the questions that I asked my noble friend was why it was felt necessary to make this exemption. There is nothing new in what my noble friend said tonight that went beyond what he said last week and what my own researches have shown. Why is there still this exemption for the kind of chap whom I described in my speech of 40 years ago? The 1964 Act was passed a few months before I became a Member of the other place, which is rather a long time ago. Why is it necessary to have this exemption now? My noble friend has not fully satisfied me on that.
Lord Henley
I did deal with that—I said that the exemption goes back to that Act and there is proper regulation of those itinerant traders. It is one that we can look at in future, but we do not think that it is right to increase the burden on them, particularly as there is not the opportunity that my noble friend implied for a mad rush of traders to become itinerant traders, because there is a process by which they are regulated by local authorities and the police. I do not believe that there is the problem that he sees, but it is one that we can look at in future.
I felt that I had answered the question and made it clear that, if the amendment went through and those people were removed, it would create problems in dealing with them—as I said to the noble Lord, Lord Faulkner.
Lord Faulkner of Worcester
I am not going to apologise for bringing the subject back at Third Reading, because we have learnt a great deal this evening from the Minister in his very interesting speech.
I thank the noble Lord, Lord Jenkin of Roding, and my noble friend Lord Campbell-Savours for their quite excellent contributions. The noble Lord, Lord Jenkin, has taken the trouble to look at the issue in some detail and has come forward with a series of questions, some of which he has had answers to —although, with one or two of them, he may feel that the answer was a little bit opaque. My noble friend was a bit feistier than the noble Lord, Lord Jenkin, but he too made some powerful points. Again, I was interested to hear what the noble Lord, Lord Henley, said in reply.
One benefit of having this debate this evening is that the officials in the Home Office will be aware that there is great interest in this House about the legislation as a whole and particularly about whether the exemption is going to work. If the noble Lord, Lord Jenkin, is right and there is a large increase in the number of applicants for exemptions, it will be evident that the loophole has become unacceptable and will do great damage to the much wider and laudable aim that the Government have of eliminating cash from the sale of scrap metal. I hope that we at least see that the Home Office reviews this carefully, and I assure the Minister that we will come back to this on future occasions to ask questions on how it has gone.
I am a little unclear about the five-year review to which my noble friend Lord Campbell-Savours referred, which is in Clause 148. It might be more satisfactory if the review took place more quickly than that. However, I express my appreciation to the Minister for the thoughtful way in which he responded to the debate. I am not satisfied on all the points that he has made, but it is not my intention at this time of night to have a vote—although I must apologise to my noble friend Lord Campbell-Savours, who would like to have a vote. The message from the debate to the Minister is that we want to watch how this legislation develops and, if it goes wrong, I hope that remedies will be offered to us very quickly. I beg leave to withdraw the amendment.
Lord Bach
My Lords, I will be as brief as I can with this amendment. This is the third time that the issue has come before the House. The names put to the amendment on the first occasion were those of the noble and learned Lord, Lord Mackay of Clashfern—who made a very powerful speech—the noble Lord, Lord Thomas of Gresford, and mine. On Report it was just my name and that of the noble Lord, Lord Thomas of Gresford, and he made a very powerful speech. Now it is down to one, and I intend simply to ask the Minister some questions.
The Minister will recall that, on Report, he stated that the Government accepted that “insolvency proceedings are untypical” and—stand apart as they are—that they are,
“one of the few areas where CFAs sometimes work to the advantage of government departments”,
and creditors generally. Despite that, and despite what I would argue are clear arguments in favour of it, the Government have decided against “a carve-out” for insolvency. The Minister announced that there has been,
“agreement across government, in respect of insolvency proceedings”,
and,
“that new ways will be implemented to deal with these cases without recoverable success fees and insurance premiums”.—[Official Report, 14/3/12; col. 358.]
The insolvency profession has apparently not been involved in any discussions with the Government about this new way of approaching insolvency proceedings and is concerned that the Ministry of Justice and HMRC may have decided that a contingency legal aid fund could be set up for insolvency cases.
My questions to the Minister are as follows. First, what are the Government planning with regard to insolvency proceedings and—to ask the same question as the noble Lord, Lord Thomas, asked on Report—when will this be implemented? Is it indeed a contingency legal aid fund, or is it not? Secondly, if the Government are not going to exempt insolvency proceedings, will they agree to carry out a proper impact assessment to determine the impact that this will have on the taxpayer and business community? Thirdly, have the Government consulted the insolvency profession on how this might work in practice? Fourthly, will this measure help safeguard returns not just for HMRC but for private businesses as well? Fifthly, will this measure act as a fraud deterrent, as the current system does? Sixthly, if this new way does not work, what protections will the Government put in place to safeguard returns to HMRC and businesses? Could there be an exemption, for example, further down the line? Lastly, can the Minister assure the House that the Government will consult the insolvency profession on the details of these proposals? Those are the questions that I would like answered. I beg to move.
Lord McNally
My Lords, as I indicated on Report, we have reached agreement across government in respect of insolvency proceedings. In future these cases will need to proceed without recoverable success fees and insurance premiums. Alternative ways will be developed in time to deal with these important cases. We are working on a programme for implementing Part 2 of the Bill, and the details relating to insolvency proceedings will be set out in due course, before implementation. Insolvency cases will need to proceed without recoverable success fees and insurance premiums in the future. The impact of the Government’s CFA changes on those affected will depend on a number of unknown factors, including the volume of cases pursued in future, the number of cases which win, the levels of success fees and ATE insurance premiums negotiated, and the recoveries made in those cases. The Government will work with HMRC and others to further assess the impact of our changes. Policy discussions within government continue all the time, and remain confidential until the policy is agreed and announced. I urge the noble Lord to withdraw his amendment.
Lord Bach
Of course I am going to withdraw my amendment this evening, and I understand that the Minister could not answer all the detailed questions that I put to him just a few minutes ago. I would be grateful if he would be good enough to get his officials to write to me, through him, with the replies that he was not able to give tonight.
Lord McNally
To clarify, my Lords, we will engage as well with insolvency practitioners.
Lord McNally
“(3A) Section 78 extends to England and Wales, Scotland and Northern Ireland, subject to subsection (10).”