House of Commons (23) - Commons Chamber (9) / Westminster Hall (6) / Written Statements (4) / Petitions (2) / Ministerial Corrections (2)
House of Lords (14) - Lords Chamber (8) / Grand Committee (6)
My Lords, welcome to the Grand Committee this afternoon. If there is a Division in the Chamber, the Committee will adjourn for 10 minutes.
(10 years, 3 months ago)
Grand Committee
That the Grand Committee do consider the draft Scotland Act 1998 (Modification of Schedule 5) Order 2014.
Relevant document: 24th Report from the Joint Committee on Statutory Instruments.
My Lords, I shall provide a brief summary of what this draft order, which was laid before the House on 17 March 2014, seeks to achieve. The order is made under Section 30(2) of the Scotland Act 1998, which provides a mechanism whereby Schedule 4 or Schedule 5 to that Act can be modified by an Order in Council, subject to the agreement of both the UK Parliament and the Scottish Parliament. This order will amend Schedule 5 to the Scotland Act 1998, which I shall refer to as the 1998 Act, to update the definition of “food” in that Act. It will also amend Section J4 of Schedule 5 to the 1998 Act to reflect the agreement reached regarding the regulation of animal feeding stuffs.
Upon devolution, the regulation of food safety and standards was devolved under the 1998 Act. As at 1 July 1999, the 1998 Act understood “food” to be as was defined by the Food Safety Act 1990. Post devolution, that definition was changed on a GB-wide basis by the Food Safety Act 1990 (Amendment) Regulations 2004 to align it with the new European Union definition of “food”. The definition at devolution and the definition post devolution are largely similar, but they are not identical. I would like to be clear that this is a technical, legal difference and there is not necessarily a specific food which would have fallen under one definition and not the other. Importantly, this 2004 change resulted in a mismatch between the legal definition of “food” in the 1998 Act and “food” as it was defined in EU law. The legislative competence of the Scottish Parliament and the executive competence of the Scottish Ministers was, therefore, limited by an out-of-date definition of “food”. This was never the intention of the 1998 Act.
Similarly, in relation to non-medicinal animal feed and additives, the regulation of animal feed safety and standards was also devolved under the 1998 Act, except for the regulation of veterinary medicines, which was reserved. Section J4 in the 1998 Act reserves the subject matter of the Medicines Act 1968, which I shall refer to as the 1968 Act. Section 130(1) of the 1968 Act, as it stood as at 1 July 1999, defined “medicinal product” as including substances fed to animals and, therefore, veterinary medicinal products. However, it was subsequently agreed between the Veterinary Medicines Directorate—an executive agency of the Department for Environment, Food and Rural Affairs—and the Food Standards Agency that certain zootechnical additives, which do not have a medicinal effect on the animals that consume them, should be regulated within the framework of animal feed law rather than veterinary medicines legislation. It was agreed that the Veterinary Medicines Directorate would regulate for the UK all matters falling within the scope agreed and set out in the Veterinary Medicines Regulations 2005. Although those regulations have since been revoked, being replaced or amended by new veterinary medicines regulations almost every year, the definitions of “veterinary medicinal product” and “specified feed additives” have been unchanged since 2005. In effect, certain animal feed-stuffs and additives ceased to be veterinary medicinal products yet continued to fall within the scope of the reservation stated at Section J4 in the 1998 Act. Thus, the legislative competence of the Scottish Parliament and the executive competence of the Scottish Ministers was limited.
To address these problems, in 2005 and 2006 orders were made under Section 63 of the 1998 Act to update the executive competence of the Scottish Ministers by transferring certain necessary functions to them. These orders allowed Scottish Ministers to continue to regulate for food safety and standards by giving full effect to EU law, and also allowed them to legislate for, and control, all non-medicinal animal feed in Scotland. However, those orders did not, and could not, address the issue of the Scottish Parliament’s legislative competence in these areas. This Section 30 order will bring the Scottish Parliament’s legislative competence better into line with the executive competence of Scottish Ministers, both by updating the definition of “food” in the 1998 Act—thus bringing it into line with European Union legislation—and by amending Section J4 of Schedule 5, with respect to animal feeding stuffs. We believe that this order is a sensible way of addressing the anomalies I have described.
This order demonstrates the Government’s continued commitment to working with the Scottish Government to make the devolution settlement work in a very practical way. I hope the Committee will agree that this order is a reasonable use of the powers in the Scotland Act 1998. The order was debated in the House of Commons on 29 April this year and received the approval of that House on 30 April. I commend the order to the Committee. I beg to move.
My Lords, I thank the Minister for explaining the content of the order. I welcome any move that is devolutionary in character. I certainly believe that Scottish-branded food and the animal feed-stuff that goes toward producing it are a central part of the Scottish economy and the tourist economy. I believe that Scottish farmers and growers are some of the most efficient in the world and that the Scottish Parliament therefore should certainly be in direct control of this type of regulation.
My Lords, I thank the noble and learned Lord the Minister for so fully explaining the ins and outs of these various additions to Schedule 5. On the question of bringing these regulations into line one with the other, I was interested to hear about the devolving of zootechnical feeds and items like that, but the notes to the order talk about some elements that are quite difficult to get one’s head round, such as medicinal products for use in animals that are not veterinary medicinal products or feed additives. First, will the regulations now work in the same way both in England and in Scotland? Secondly, I understood that all of these subjects were controlled under the Veterinary Medicines Directorate in practical terms. Does this mean that the Scottish Parliament will now need to set up its own Veterinary Medicines Directorate because the regulations devolve the matter to the Scottish Parliament?
My Lords, I join in the thanks and appreciation to the Minister for the excellent way in which he introduced this order today. He always does this; we are not surprised in any way when he does it so expertly and we are really grateful to him. I wanted to raise two points. I am afraid that I do not have the detailed knowledge of food and agriculture possessed by my noble friend the Duke of Montrose, so my points are more technical.
First, I have a general point. I am increasingly concerned that this Parliament is seen by some people as merely a rubber stamp for the Government and that all the Government need to do is to bring something before both Houses in this Parliament and it will be agreed on the nod. Too many things are going through on the nod. I sit in the Chamber and think, “Why are we agreeing to this? Why are we not discussing it? Why are we not debating it?”. Do we not have the time? Yes, we do. We have been in recess for four weeks. We could have been discussing and debating issue after issue, point after point. Of course the Government like to get things through on the nod, but that is not part of democracy. We can see democracy being challenged elsewhere in the world, so we should be upholding it and making sure that Parliament’s role is appreciated. Every issue, however detailed it is, deserves proper consideration by both Houses of this Parliament.
Like other noble Lords, I go around the country as part of the Lord Speaker’s excellent Peers in Schools initiative to spread the word in schools about the House of Lords and its role, and I find it very useful. I talk about the three roles of the House of Lords: legislation, challenging the Executive, and holding debates. But I must say that more and more I feel like a fraud when arguing that case if the House has not sat for four weeks. It now looks as if we will not be sitting for another three weeks in the run-up to the Queen’s Speech. It is quite wrong that Parliament should meet so infrequently in order to challenge the Executive. That was the first point I wanted to make. I am sure that it is not something the Minister and his officials will have anticipated, or if they have, they have been very clever and deserve degrees in clairvoyance, if nothing else.
My second point relates to the devolution settlement. The Minister said that this order shows that the devolution settlement is working in a practical way. Perhaps I can say that I agree with him absolutely, and it is what we should be shouting from the rooftops: devolution is working. It has provided an opportunity for Scotland to make decisions about its own affairs on all the matters that affect Scotland in particular, and it is working really well. The traditions of Scotland and its legal system, on which the Minister is one of the experts, have managed to continue for over 300 years in spite of the existence of the United Kingdom and the Treaty of Union. If anyone is worried that I am straying from the subject before the Committee—my noble friend Lord Rosser has just a slight inclination that I might be doing so—this will bring me back. The Minister mentioned European Union food safety laws. Let us imagine the problems that would arise on a whole range of things if Scotland was to become a separate country from the rest of the United Kingdom. It would raise all sorts of questions about the transfer of foodstuffs across the border. It is just one of not hundreds, but thousands, of issues where greater problems would be created if Scotland was to be a separate country.
While not wanting to put words in his mouth, I hope the Minister will agree that the devolution settlement is flexible and working well. Almost every time the Grand Committee meets, there seems to be some kind of order relating to Scotland to be considered, tweaked and improved so as to get devolution working even better. This shows that the devolution settlement is flexible, workable and practical, and that it can and will be improved as long as Scotland remains part of the United Kingdom.
My Lords, as usual it is a pleasure to try to follow my noble friend Lord Foulkes and we shall see how I get on with that. I should like to place on the record my sincere appreciation for the Minister and his team on the usual high-quality briefing and willingness to discuss matters. As it happens, the briefing was so good that it did not require any further meetings.
It is interesting that the noble Earl, Lord Mar and Kellie, mentioned how this is working but was not as fulsome as my noble friend Lord Foulkes in paying tribute to the devolution settlement as actually being good enough to work in the current atmosphere. It is interesting as well that objections are coming from the Scottish National Party about the fact that Westminster deals with issues such as this and brings forward statutory instruments to put into effect sensible and common-sense measures, but the main reason that this order has been brought forward is a ruling from the European Union. It is funny how the SNP objects to Westminster but does not object to the European Union, although some of us have always had reservations about the amount of regulations coming from Europe.
My Lords, I thank noble Lords who have participated and thank them for the welcome they have given the order. My noble friend Lord Mar and Kellie was absolutely right to remind us of the importance of the food industry in Scotland and the importance of maintaining its quality.
My noble friend the Duke of Montrose raised some technical issues. He asked whether, following devolution of zootechnical feed regulation, matters would work in the same way in England and Wales as in Scotland and whether it would be necessary for Scotland to set up its own veterinary medicines directorate. Veterinary medicines will continue to be regulated by Defra. It is because certain items in the EU definition were removed from the definition of veterinary medicines that we are having to make this adjustment. Veterinary medicines will continue to be regulated by Defra—in practice by the Veterinary Medicines Directorate—and so the system will be the same in England and Wales as it is in Scotland. Non-medicinal zootechnical issues will be devolved, but that will be about implementing European Union law, and there will therefore still be consistency north and south of the border.
The Minister made a point in relation to the question from the noble Duke, the Duke of Montrose. Can he confirm that the work undertaken by Defra, in Scotland as well as in England and Wales, is one of the many things that would have to be torn apart if Scotland separated from the rest of the United Kingdom?
The noble Lord makes a very alert and important point. The Veterinary Medicines Directorate is a directorate of the United Kingdom Government and would not automatically be transferred or shared in the event of a yes vote—which I hope will not happen. It is yet another example of one of the many institutions and agencies which operate on a Great Britain basis. I believe they operate successfully on that basis.
In response to the noble Lord, Lord Foulkes, Parliament should certainly not just be a rubber stamp for the Government. It is important to put on record that the process we are following here is set out in a law passed by Parliament. As I have indicated, this order has been debated in the House of Commons and approved by it. The fact that we are having a debate on it is very healthy and right and proper. The issue is, indeed, technical but nevertheless the debate has offered noble Lords an opportunity to express their views and to ask some very pertinent questions.
I certainly agree with the point made by the noble Lord, Lord Foulkes, which I think was echoed by the noble Lord, Lord McAvoy, and my noble friend Lord Mar and Kellie, that this is an example of the devolution settlement working. I think that it is a very good example of that. It is a technical issue but it shows a willingness to address practical issues in a practical way as and when they arise. Under the previous Administration, a certain amount of executive devolution was achieved on these issues through a Section 63 order. However, we now have a position whereby the Scottish Government have decided to establish a new food body for Scotland which will take on the roles and responsibilities of the UK-wide Food Standards Agency. Therefore, there is legislation going through the Scottish Parliament and a Bill has been drafted to sit within the limited sphere of legislative competence in relation to food and animal feed as set out in the 1998 Act. If this House passes the order—it will also need to be passed by the Scottish Parliament and then submitted to Her Majesty in Council—the Scottish Government intend to seek an amendment to widen the scope of the Bill to bring it in line with the scope of the existing food and animal feed law, as amended by this order. Therefore, the issue is of practical relevance given that the Bill is currently before the Scottish Parliament.
We have shown good will in negotiations and discussions with officials in the Scottish Government, my own department and other departments of the UK Government, not least Defra. That is a good practical example of the flexibility of the system. People refer to the status quo but I do not believe that there is any such thing as the status quo in relation to something which has evolved since 1 July 1999. The system has shown its ability to respond to different circumstances and I sincerely hope will continue to do so as we move forward. I again commend the order to the Committee.
Before the noble and learned Lord sits down, would he care to comment on the limited ability to hold a Government to account due to the lack of sittings?
My Lords, I will have to check but I do not think that there are many, if, indeed, any, fewer sitting days this Session than in the previous Session. The number of sitting days is not far off that for the previous Session. No doubt my noble friend the Leader of the House would be able to give the exact figures. I do not think that it is unique for one House to sit when the other is not. That probably happened under the previous Government as well. I am sure that the noble Lord will welcome the fact that the House will not sit in order to accommodate the Liberal Democrat conference in Glasgow in October. I do not welcome it as I have lost my excuse for not attending the conference. However, that does mean that the two Houses will be in step as regards when they are sitting, or not sitting in that case.
(10 years, 3 months ago)
Grand Committee
That the Grand Committee do consider the draft Merchant Shipping (Convention Relating to the Carriage of Passengers and their Luggage by Sea) Order 2014.
Relevant document: 25th Report from the Joint Committee on Statutory Instruments.
My Lords, before I turn to the detail of the draft Privy Council order, I would just like to say that it is not often that I get the opportunity to debate a maritime matter, and I thank those noble Lords who are taking part.
The United Kingdom, which is surrounded by some of the world’s busiest shipping lanes, is particularly vulnerable to the consequences of maritime casualties. Thankfully, such instances are rare, particularly those involving passenger ships. However, we need only look at the terrible tragedies elsewhere in the world involving the cruise ship “Costa Concordia”, and more recently the South Korean ferry “Sewol”, to remind us that we can never be complacent.
Through this order, we are seeking to amend the Merchant Shipping Act 1995 to reflect the UK’s ratification of the International Maritime Organisation’s protocol of 2002 to the 1974 Athens convention relating to the carriage of passengers and their luggage by sea. This modernises and significantly strengthens the international framework for providing compensation in the event of death or personal injury to a passenger, or the loss of or damage to luggage, when travelling by sea.
The 2002 Athens protocol, which entered into force internationally on 23 April 2014, increases the limits of liability that currently exist for carriers of passengers under the 1974 Athens convention up to 400,000 special drawing rights, which is the virtual currency used by the International Monetary Fund. As of 24 April 2014, one special drawing right is equal to approximately 92p. The 2002 Athens protocol also requires carriers to maintain compulsory insurance of not less than 250,000 SDRs per passenger on a strict liability basis, and this insurance is to be evidenced by a certificate from a state party. It also provides claimants with the right of taking direct action against the insurer.
UK ratification will actually have very little practical effect on UK ship owners. This is because the key provisions of the 2002 Athens protocol have already been introduced into EU law. EU Regulation 392/2009, which entered into force on 31 December 2012, was implemented in the UK by means of the Merchant Shipping (Carriage of Passengers by Sea) Regulations 2012. Nevertheless, further government intervention is now necessary to ensure that UK-flagged passenger vessels can be issued with the correct state certification attesting that they have the necessary insurance in place at international level to meet their obligations under the 2002 Athens protocol when travelling on international, as opposed to EU, journeys.
In addition, the order will also enable the 2002 Athens protocol to be extended to the overseas territories and Crown dependencies, should they so wish it, which, if they chose to do so, would enhance the protection that is available to passengers travelling on board vessels that are flagged to those territories when travelling on international journeys.
In keeping with the responses received during public consultation, the order also preserves the existing arrangements for domestic journeys. This means that the original 1974 Athens convention, along with a limit of liability which has been progressively raised to 300,000 SDRs for those ship owners whose principal place of business is in the UK, will continue to apply to the carriage of passengers within the UK, the Channel Islands and the Isle of Man.
This order also presents us with an opportunity to revoke some related domestic legislation—Carriage of Passengers and their Luggage by Sea (Interim Provisions) Order 1980. This is an enabling power and applies only to contracts for domestic carriage made before 30 April 1987, so it no longer has any practical effect. It was identified as being completely redundant under the maritime theme of the Red Tape Challenge—an initiative that I sure many noble Lords will be familiar with.
Finally, some noble Lords may have already spotted that there is no review provision in this order. This is not an oversight; there is simply no power to incorporate such a provision here. Nevertheless, I can assure noble Lords that the Secretary of State for Transport will carry out a review, and will publish the conclusions of that review, every five years. The first such report will be published before 23 April 2019. I commend the order to the Committee and beg to move.
My Lords, I think the Minister was perhaps a bit premature in thanking noble Lords who are taking part in a rather rare maritime exercise in the House. I do not want to disabuse her, but I was not going to say anything at all. This order is a natural follow-on from what has happened before. I have no problems with it at all. The UK Chamber of Shipping also had no problems with it, so it is generally to be welcomed.
We have been fortunate in this country in that we have not had a major accident with a passenger ship since the “Herald of Free Enterprise” some 27 years ago. That was responsible for beefing up the amounts of compensation that can be paid to passengers for loss of life and luggage in those circumstances. Let us hope that that record continues although, as the Minister said, we are still suffering from these problems. We saw one in South Korea the other day, and the unfortunate incident with the “Costa Concordia” was another example. I welcome this order and wish it well.
My Lords, I am in the same position as the Minister. Debates on maritime matters are all too rare. I do not think the Minister was expressing the view that she is a particular expert in this field, and I would certainly not claim to be. That may become horribly evident in the contribution I have to make.
As the Minister said, this order amends the Merchant Shipping Act 1995 in the light of our ratification of the International Maritime Organisation’s 2002 protocol to the Athens Convention 1974 relating to the carriage of passengers and their luggage by sea. Ratifying the 2002 protocol ensures that UK-flagged passenger vessels can be issued with correct international certification and enables the protocol to be extended to the overseas territories and Crown dependencies, should they so wish. When the order was discussed in the other place a question was asked about what the Government’s accountability and jurisdiction would be if ships that are not UK-based, but are part of the Red Ensign group, chose to opt into these rules. It would be helpful if the Minister could clarify that point.
As the Minister said, the key provisions of the protocol have already been introduced into EU law—I think from the end of 2012—and implemented by the UK, but this order is needed to ratify the protocol, which came into force internationally on 23 April and incorporates the international elements. The 2002 protocol applies to international carriage only, but the order ensures the application of the Athens convention to domestic journeys within the UK, the Channel Islands and the Isle of Man. The 2002 protocol increases the liability limits for carriers that have been applicable in the event of accidents involving loss of life or personal injury and also requires carriers to maintain compulsory insurance on a strict liability basis, as well as providing claimants with the right to take direct action against the insurer. Under the order, the new limit of liability is, I think, the 400,000 special drawing rights. The Minister said that a special drawing right is currently equal to approximately 92 pence. It certainly fluctuates marginally since earlier in the year when it was being debated in the House of Commons the figure was given as approximately 93 pence.
The Government have also said that the further policy objective of the order is to revoke some redundant legislation. It would be helpful if the Minister could spell out which legislation is being revoked, bearing in mind that the Government’s objective appears to be that, for every new order introduced, two should be revoked. I am not clear what the two orders are that are being revoked.
The Explanatory Memorandum states in paragraph 10 that, although,
“external stakeholders were invited to contribute to the IA, the available evidence base continues to have a number of limitations”.
It then goes on to say:
“Given the significant uncertainties surrounding the impacts of this measure”,
relating to,
“the number of Overseas Territories and Crown Dependencies that … choose to ratify the … Protocol … and the limitations of the available evidence base, it has not been possible to monetise any of the costs and benefits in this IA”.
At least, that is my understanding of what it says. Yet when the order was discussed in the other place, the Minister described it as “short and highly technical”. I have always construed the reference to “highly technical” to mean “incomprehensible”. He said that not least because the,
“key provisions of the 2002 protocol have already been introduced into European Union law … and … implemented in the UK”.
The Minister in the other place said that the order therefore had,
“little practical effect on UK shipowners”.—[Official Report, Commons, Second Delegated Legislation Committee, 30/4/14; col. 3.]
I simply ask which is the correct version—that the order is short and highly technical with little practical effect on UK ship owners, as per the Minister in the House of Commons, or that, due to the significant uncertainties surrounding the impacts of the measure and the limitations of the available evidence base, as per the Explanatory Memorandum, monetising any of the costs and benefits of the order in the impact assessment is not possible and, by inference, would represent something of a voyage of discovery. Perhaps the Minister could indicate which horse of those alternatives she is backing, or, alternatively, say why what would appear to be two somewhat different views on the clarity and scope of this order are in fact saying precisely the same thing.
A further issue raised in the House of Commons was about the ships to which this order applies. In his response, the Government Minister said that,
“the classification of ships is determined by the area in which they operate and not necessarily the gross tonnage”.—[Official Report, Commons, Second Delegated Legislation Committee, 30/4/14; col. 8.]
However, because he was unable at that particular moment to give a definition of classification A and B vessels as referred to in the impact assessment, he undertook to write to the Committee. Can the Minister here provide that information and say whether the provisions of this order might be extended to other classes of ships?
A further question raised in the other place was about what steps the department was taking to ensure that information about the impact of the order was made available to ship owners and their passengers and customers. It would be helpful if the Minister could say what is happening on that issue. Of course, the answer to that may depend on whether she agrees with the Minister in the House of Commons that it is short and technical with little practical impact or with the Explanatory Memorandum, which appears to suggest otherwise. Finally, the Minister in the other place said that he was concerned to reduce the costs of the legislation around sulphur for UK shipping and, in particular, for the UK ferry industry. He went on to say that he had,
“asked the IMO to undertake an early review of the 2020 regulations”.—[Official Report, Commons, Second Delegated Legislation Committee, 30/4/14; col. 8.]
What exactly are the Government pressing for in that review?
We welcome the objectives of this order but would appreciate responses to the points to which I have referred.
My Lords, I thank the noble Lord, Lord Greenway, for his reminder that we must not be complacent on this issue. As he says, the British shipping industry has an excellent safety record that is to be valued, but we must ensure that we continue to keep that record, as complacency would be dangerous. It is important to us to maintain that position in the global marketplace and our reputation for maritime excellence, as well as recognise our obligations to people who travel by sea.
I shall try to address the questions raised by the noble Lord, Lord Rosser, although I am not sure that I will satisfy him, given that the Minister in the other place did not. If there continue to be gaps, we will definitely follow up in writing but I will do my best to attempt to answer in an area which, as he is well aware, is certainly not one in which I would claim expertise. First, the noble Lord referred to the overseas territories and Crown dependencies and asked for a somewhat fuller answer, if I understood him correctly, on how we would enforce that protocol within that context if they opted to become signatories. He will know that the UK—as a signatory to international conventions on shipping-related matters—is bound to make sure that it gives effect to any changes under the conventions. It would therefore have a responsibility to ensure that any signatories among the overseas territories and Crown dependencies were followed through; failure to do so would constitute a breach of our international obligations under these conventions. I hope that adds significantly to the comments made by my honourable friend in the other place. We have obviously been encouraging these territories and Crown dependencies to sign up, so it is clearly good for travellers if they do so.
On revoking legislation, I believe I covered that in my opening speech. The Carriage of Passengers and their Luggage by Sea (Interim Provisions) Order 1980 seems to be almost unusual in that nobody thinks it has any practical effect any more. Therefore, removing it from the books strikes me as extremely appropriate. If I understood the question of the noble Lord, Lord Rosser, he was saying that there was a sort of “one in, two out” relationship. I have no idea what the “one” is or what the pairing “two out” was, but I think that he would support the idea that anything that was completely redundant was best off the books, rather than providing a complication.
I certainly share that view—there is no point keeping something on the books that is completely redundant—but I was looking at what the Minister said in the Commons:
“I am pleased to say that the Department for Transport, as its contribution to the red tape challenge, met its commitments on one in, one out. It is now meeting its commitments on one in, two out as well”.—[Official Report, Commons, Second Delegated Legislation Committee, 30/4/14; col. 8.]
It was in light of the Minister’s comment in the House of Commons that I was asking what the two were that were being removed now that this one was coming in.
I am sure that the department would be delighted to write to him, as I will, with our successes in removing unnecessary and problematic regulation. We would be delighted to follow up on that issue but, standing at the Dispatch Box today, I cannot tell him that I know the answer.
The noble Lord then asked a question—he will help me if I am not fully understanding this—as to whether this was a piece of legislation that had no practical impact, or a piece of legislation that had important impact and looked at two areas of discussion. This is a piece of legislation that would have been significantly important had not the EU already enacted its provisions. Looking at the SI today, it is fair to say that it does not have a big practical impact because that was achieved back in 2012, when the EU protocol, which incorporates a directive including these provisions, came into force. It is important that the levels of compensation have been raised for passengers who may be in the appalling situation of being injured—potentially even killed—or having damage to their luggage. That is entirely appropriate. The protocol is necessary because there must be some containment of liability or else insurers will not be willing to step up to the plate. In that case, we would see a dramatic diminution in passenger sea transport. Raising that limit has been important, and the fact that it is an international protocol also matters, certainly to British passengers who do not necessarily travel only on UK-flagged vessels. It has been an important piece of legislation.
We did say at the end that we welcomed the objectives of the order, so we are not in any argument about what the order is seeking to achieve. Our point was just about what appeared to be the rather different view of the Minister in the Commons—who considered the order to be short, technical and with no impact on UK shipping—and paragraph 10 of the Explanatory Memorandum, which says that the,
“available evidence base continues to have a number of limitations…significant uncertainties surrounding the impacts of this measure…it has not been possible to monetise any of the costs and benefits in this IA”.
Clearly, as far as the author of this document is concerned, it is an issue of some significance. If it were not, why are those words in there?
Frankly, in a sense, I am with the Minister, but if one is writing a technical document one does it against very technical standards. If you went out and described to a member of the public the increase from only 40,000 SDRs—I think that was the original figure—to the current 400,000, they would see that as a significant and important change. The technical language used by those who follow a very technical process of assessment may be somewhat different. As a very effective politician with a good history, the noble Lord will appreciate that issue. I do not have a problem with the difference. If his question was on whether we have consulted people to ensure that they consider the impact is appropriate, I should say that there was extensive consultation in 2012. Given that the practical effect of this SI is to extend the international scope rather than the EU scope, the noble Lord will understand that we did not need to repeat that consultation. He will know that this is a very widely supported measure.
The noble Lord asked about class A and class B domestic vessels. As he will know, domestic vessels are defined by the areas of the sea in which they operate. Class B ships are passenger ships engaged on domestic voyages where they are at no point more than 20 miles from the line of the coast. Ships falling within the description of class A are those on domestic voyages operating at greater distances from the coast. Under the EU protocol, I believe that class A will come under these same provisions in 2016 and class B in 2018, but through the mechanism of the EU.
Is there any intention to extend this to any other groups of vessel?
The UK had already raised its limits to 300,000 SDRs for domestic sea travel. I think that the noble Lord, Lord Greenway, referred to this. When the relevant statutory instruments are brought in to deal with those changes for 2016 and 2018, it may well be appropriate to look more broadly at the entire domestic environment. However, at this moment in time, awards are not pushing up anywhere near to the limits provided under the current arrangements and it seemed tidier to deal with the domestic situation within a similar timeframe.
I am trying to ensure that I do not go over time but an issue was raised about communication. As the noble Lord will remember, extensive consultation took place in 2012. Those conversations continue on a regular basis with the Chamber of Shipping and all the various interested parties, so there is no concern that appropriate bodies will not be aware of the relevant provisions.
I was trying to look that up because I remember that a fairly substantial answer was given on it in the other place. However, I will come back to the noble Lord on precisely how we are informing consumers of their rights because I have to confess that it has slipped my mind at the moment.
Questions were asked about the ferry industry and the early review of the 2020 regulations. I will obtain more detail on that issue for the noble Lord, if it is available. However, a review tends to be reasonably broad ranging—that is why it is a review. Presumably, it will cover the appropriateness of the regulations and their practicality in a modern environment. I hope that I have covered those issues adequately. If there are any outstanding issues, I will be glad to follow them up in writing. I commend the order to the Committee.
(10 years, 3 months ago)
Grand CommitteeMy Lords, I am most grateful to have been granted time for us to debate what I believe is a crucial inflection point both in the UK’s relationship with China and in China’s own outward investment story. I declare an interest as the chair of the All-Party Parliamentary Group for East Asian Business and as a director for the Manchester-China Forum. I also declare a number of other relevant personal and public roles and interests which are outlined in the Lords register.
In particular, I would like to highlight through this debate the recent publication of a report commissioned by the All-Party Parliamentary Group for East Asian Business and conducted independently by Roland Berger entitled the Independent Review of Chinese Foreign Direct Investment. I hope that this report will help inform and stimulate this debate, and the debate that we as a society and country need to have as Chinese firms over the coming years dramatically increase their investments internationally, and in the process become a more important feature of economies such as ours.
In many ways there has always been investment and trade from and with China and the Chinese into the UK, whether in financial or non-financial ways, with waves of Chinese immigrants over the years putting in their time, energy and capital to help build and rebuild this country in the run-up to and after the two world wars. Think of the catering industry and the supply chains that feed it, and then think about the recent manufacturing story as UK firms worked with Chinese partners to lower their costs and globalise their supply chains. And then think about more recently as newly affluent and increasingly aspirational Chinese people have come to the UK to invest in a variety of financial assets, from property to stocks and bonds, arts and antiques, and luxury items.
During this period and in particular with the liberalisation of trade within China and encouragement of state and private enterprises to invest abroad, outbound FDI has accelerated, creating a huge opportunity for countries such as ours. The APPG report highlighted a number of scenarios, from today’s relatively low investment base to seeing the UK capturing between 3% and 5% percent of China’s future annual global outbound foreign direct investment, which alone would create between 48,000 and 75,000 direct jobs by 2020 in a median and optimistic scenario. The drivers of such investment include a competitive tax regime, the City of London as a future hub for offshore renminbi trading, high educational quality at different stages, our world-class industry sectors, and our openness as a country to FDI in areas as diverse as manufacturing, infrastructure and finance.
The Government in particular have done a significant amount to enhance Britain’s attractiveness to such investment. The most visible expression of this includes the various ministerial visits last year, as well as changes to the visa process to make it easier for tourists and business leaders to come, shop and do business here. Behind the scenes I know that much good work is carried out by UKTI, the China-Britain Business Council, and regionally to encourage Chinese people to visit and invest on both the large and the small scale. This has produced fruit with recent announcements such as the Royal Docks development by ABP, the investment into Manchester’s Airport City being spearheaded by Beijing Construction Engineering Group, and the significant investment in R&D and higher education by telecoms firms such as Huawei, a supporter of the APPG. In addition, we have in recent years witnessed major welcome investments into nuclear power, water utilities, engineering firms and even breakfast cereals. More such investments are in the pipeline, evidenced by recent positive visits to the UK by organisations such as the China Entrepreneur Club, whose member businesses represent a significant proportion of private enterprise turnover in China. Indeed, the chair of McKinsey & Company Asia recently wrote that 2014 could be the biggest year for Chinese foreign direct investment into the UK, and the APPG report highlights the continuing strong upward trend we are likely to see in the wake of these first major investments.
Now is a crucial time when major global Chinese firms are deciding where to locate their headquarters as they start to look beyond the borders of Greater China, and the UK can undoubtedly benefit from this influx so long as we remain an attractive place to invest and do business in. However, we must remember that the benchmark should not be how much such investment is growing in absolute terms, but how we are doing in capturing a share of this investment globally as compared to our competitor nations in Europe and around the world.
While we have a lot to be thankful for and to congratulate ourselves on as a country, the APPG report highlights a number of areas where we could do even better, not just to continue to boost our share of Chinese global FDI, but to ensure that there is balance and diversity in the investment from China geographically, by sector and, indeed, by size. The report highlights that as Chinese firms decide where to locate their headquarters, more could be done to address the issue of hiring talent. It is all very well to enable the chairperson to locate to the UK, but headquarters need to have top teams, and if you are relocating part of your top management from China to help establish operations here in Europe, you will want to do so in countries that make that possible. Currently, there are difficulties for firms looking to bring in experienced Mandarin speakers versed in their own corporate culture. Other countries in Europe and elsewhere often even help to negotiate visas for top management at the point when the decision about which country to locate to is being made.
We need to operate on a level playing field globally with other nations, particularly Germany and others in Europe who have the added advantage of being in the Schengen zone. The need for business management visas, which could be addressed if we redesigned our system more around the skills we need as a country, ought to be addressed alongside the issue of the removal of post-study work visas. In my view, the system ought to be relaxed for countries in the emerging world that we want to trade with more, such as China, in order to provide our local firms with Mandarin-speaking, China-savvy talent that will help them grow, as well as supporting firms which are interested in locating their headquarters here.
Another area highlighted in the report is the need for more FDI to be attracted into areas within and beyond London and for resources to help diversify agency support so that it is not carried out only centrally, but also regionally. With the recent focus of UKTI effort around strategic sectors, which fits with the report’s recommendation for greater sector expertise in our national approach to attracting foreign Chinese investment, there is a real opportunity for cities and localities to utilise their local knowledge and networks and help small and medium-sized enterprises to connect with China by receiving Chinese investment. It would be interesting to see what the Government can do to diversify and attract more funding into this area so that the north and west of the country and areas outside London, as well as poorer areas of London, can benefit from the influx of Chinese funds.
The report also contains a number of recommendations and observations that highlight the importance of the cultural and even linguistic sensitivity needed for us to continue and grow our trade links with China and to attract further Chinese investment, from bringing in Chinese language-translated tax information, just as we have brought in Chinese language visa application forms, to encouraging commissioners of public tenders to be aware of the sometimes lengthy decision processes in China for outbound investors, which can take a year or more for investments of more than $1 billion, to simply understanding China’s regular five-year plans and how they affect priorities for investment at the level of firms and sovereign wealth funds. Here there is a role for both public and private intermediaries to be supported in their efforts to help bridge the cultural and linguistic divide. Intermediaries struggle at times, particularly in making medium-sized deals happen, because the timelines for facilitating an investment and ultimately getting paid for their work can be lengthy. This is important because while billion-dollar deals benefit the economy and help us hit our quotas, small and medium-sized firms, as we know, employ more people and have the potential to create more jobs.
What is the Government’s response to the recommendations in the APPG report, and how do they intend to address the visa, regional and intermediary- support challenges that it highlights, so that we can continue to compete with countries such as Germany and others and bring the benefits that come with increased Chinese investment to more industries and to firms of different sizes and geographies?
The final point I wish to make is to emphasise the importance of relationships. For 50 or more years, we as a country have benefited greatly from our alliances with Europe and America, with whom we have shared cultural and linguistic histories. Businesses here in the UK have traded with, invested in and received investment from partners across the English-speaking world and the continent for many decades. Relationships have been key to this, as well as proximity and opportunity. With the re-emergence of China economically on the world stage, it is relationships that are going to be key, not least because, perhaps more than most places in the world, they form the bedrock of business culture. To receive productive, successful investment from China and to ensure it creates local jobs and growth for Britain and British firms requires an understanding of the Chinese mindset, its culture, its priorities and its people, and of how Chinese firms are having to learn to adapt to deal with our market, our legal system and even our media.
To this end, I want to ask my noble friend the Minister how as a country we plan to do more to engage the local Chinese British diaspora and visiting Chinese students in the UK—as well as more British students and graduates as they learn Mandarin and gain relevant experience in China—so that they can assist our efforts in both countries to facilitate, attract and make the most of increased Chinese foreign investment in the years to come. Beyond that, how can we work together to encourage our towns and cities to look east to create the right climate for Chinese FDI? Finally, I want to ask how we can get our small businesses in particular to feel more comfortable with trading and receiving investment from Chinese investors, which can then be a potential spring-board for them to expand their exports to other parts of the world, not just back to China itself.
The Chinese economy is going to remain a driver of the global economy, and over time of our economy, for many years to come. At this pivotal moment, let us do all we can to encourage relationships to be built up and capital to be invested so that British businesses, industries, and sectors can benefit from this growing and welcome trend. Let us ensure that at every level, not just here in London and in central government, everyone can play a part in helping to make this much needed investment work for the benefit of all.
My Lords, I thank the noble Lord, Lord Wei, for that wonderfully powerful lobbying from a certain perspective—but that is what an APPG chairman is supposed to do—and I think that we were all extremely interested in everything that he had to say. I certainly will not disagree with anything he said, but I want to highlight a couple of different issues. Before I start, let me also say that this is my first interaction with the Minister, and I am delighted to be on the same side as him—but perhaps slightly opposed—in this very significant debate. I look forward to hearing what he has to say.
I want to pose a couple of general questions. One of the most important issues that should affect Britain’s economic and political considerations is where to draw the line between strategic interests and commercial interests. Not everything can be up for sale, and not everything can be sold to everyone. In the Dubai Ports World controversy in the US some years ago, a state-owned enterprise attempted to buy what was deemed a strategic US asset. At issue was the significant question of who controls US ports. By the way, this was not a right-wing Republican argument—one of the champions of the opposition to Dubai Ports World taking over US ports was one Hillary Clinton—as there were people on all sides who saw ports as a strategic asset and therefore vetoed the attempt by Dubai Ports World to take control. Ownership was not a significant issue, as P&O had ownership of the ports at that time, but ownership by a strategic ally is very different, in terms of public perceptions of security, from ownership by a non-transparent state-owned enterprise. The issue was ownership by a foreign power about which there were perhaps reservations, either about the state itself or about the record of the entity that was attempting to do the transaction.
Likewise, on the issue of Pfizer and AstraZeneca, we in the UK need to think long and hard about strategic assets and whether research and development, including scientific research, comes into the category of meeting the public interest test. I would argue that it does, not just because of the jobs and R&D spin-offs but because, where a primary purchaser is in a dominant position in relation to the state sector—that is, in the NHS—we need to ask whether we give disproportionate pricing power to a player in foreign ownership that would be in charge of that kind of strategic asset. I would say no.
Going back to the China debate, but keeping on that theme, one need only look at the ire or public sentiment that was aroused when another strategic industry—I shall use the example of UK water utilities—was privatised. The water companies were taken over by a state-owned enterprise, which in this case meant France’s EDF, and the profits reverted to the French taxpayer. There was considerable speculation about why, in an era of austerity, British schools could not be built but the French Government had sufficient in its coffers to do quite well with its public sector.
I have not mentioned any Chinese company as an example. However, the APPG report highlights that analysis of the growth in Chinese investment, which has increased by a factor of 13 since 2008, shows that much of the growth is due to a small number of M&A deals, which are dominated, it points out, by state-owned enterprises and sovereign wealth funds. So it is only a matter of time before we are caught in a controversy where a Chinese firm or a state-owned enterprise is involved, and hence the need for the Government to think through the broader principles in this area, particularly the security dimension. Needless to say, the manner in which an industry is run is critical to public acceptance. Where it is well run and the UK benefits from investment, there is usually little disquiet. However, when it comes to an issue where “rent seeking” is too blatant—which I think was the case in the water utilities—at a cost to the consumer, in my view there is cause for legitimate complaint.
A further strategic concern has to be around technology transfer. Only yesterday, noble Lords who take the Financial Times will have seen a report on security service chiefs expressing their concern about cybersecurity in the context of junior staff at IT companies being lured into positions through remuneration where they might be able to divulge vulnerabilities in IT systems to competitors. I should say that the description of a “competitor” in terms of cyberespionage is not usually the bread-and-butter business of the level playing field where there is healthy, market-led competition, but rather the ability of foreign powers to bring down assets in other countries. Estonia experienced that from Russia, the US from the Chinese, among others—that is well documented and recorded—and of course Iran from Israel and, vice versa, Israel from the Arab countries; that is just to name a few of the well known cases. The more overt commercial attacks, which can cause the economy much more harm, are often unreported for reasons of commercial confidentiality, although they have higher costs for the economy and the companies themselves. I wonder if, in answering this debate, the Minister will reflect on the question of how and to what extent we define strategic industries, particularly when the investor has low levels of transparency, there is no public accountability and our own leverage is potentially extremely limited due to the size of our economy in relation to that of the investor.
Another factor I want to touch on is not mentioned in the APPG’s report, but it touches on global trade and competition. I refer to the EU-China trade talks that have been embraced by the UK Government and for which they have become the cheerleader in the EU. I would not wish for a moment to appear to be opposed to the talks, and I am not, but I hope that we learn the lesson from the current crisis in the EU over Russian energy supplies to several EU states. It is serving to downgrade EU states’ resilience in security terms and some countries are virtually being held hostage by certain Russian companies in terms of pricing and the delivery of energy.
The lesson here is twofold. An overreliance by strategic sectors on one supplier gives the foreign owner too much power which it may exploit. Trade dependency is similar, and one must not get hooked on any one market. So, while we welcome investment from China and our investment in China, it is terribly important that we keep our eye on diversified markets and diversified investments. It may be exciting—in the case of China we are talking about a low base at this point; I accept that completely—and there is much to play for, but we need to keep an eye on the end game, which is that overreliance on either side may not be very healthy.
The second point is my final one, and it is about multilateralism. Over the entire post-war period, Britain has championed a multilateral, global, rules-based order, whether that was the establishment of the United Nations or the Bretton Woods system, the UNCTAD or the WTO. I am therefore sorry to see us taking a narrow focus on EU-China talks rather than EU-East Asian trade talks that would include the other powerful emerging economies in south Asia. That is what the APPG is about. My fear is that when large powers are allowed to break off from multilateralism into bilateralism, geopolitics comes into the frame and power is disproportionately distributed, thus disadvantaging weaker economies. I am really sorry that the APPG on East Asian business has not sought to battle for those other countries as well in this regard, but I am sure that it will do so in other reports. Indeed, I can see that the noble Lord, Lord Wei, is nodding his head, so I look forward to those debates.
In conclusion, I agree with all the conclusions that the report laid out, and I hope that the Minister will be able to take its recommendations on board, despite the omissions. On the emphasis of the noble Lord, Lord Wei, on having ambassadors within the UK, I should declare a very small interest. I happen to be chancellor of the University of Northampton and am delighted to report that, as of last year, the president of the Northampton students union has been the first Chinese national ever to be president of a students union in the United Kingdom. So we are an outward-looking university, just as we are a country.
I am very pleased to follow my noble friend Lady Falkner, and I am pleased that she made some points about AstraZeneca, a very current issue and something that we should be majorly concerned about, separately from this debate today. However, it is welcome that the UK is the most popular destination for Chinese investment in the EU. This is good, and it represents an improvement over the past few years.
The recent All-Party Parliamentary Group on East Asian Business review of foreign direct investment into the UK is very welcome, informative and helpful in pointing to areas where we are being proactive in the UK, and where we could do more. I congratulate the noble Lord, Lord Wei, very much indeed on his leadership on this, which is really why I am here today. I am not here to say too many more words, because the report is so comprehensive, but just to give my support to the report and say, “job well done”. I hope that the Government pick up on the points that have been made.
The report is comprehensive and has drawn attention to all concerned about the issues involved. One issue that was alluded to by the noble Lord, Lord Wei, on which I have campaigned for quite a long time, is that this country needs to enable those from China who want to come here to do so. In the past, there have been great stumbling blocks on the issue of visas. There have been enormous and unnecessary problems when people from China have come here for investment purposes but also as tourists. At the end of the day, we want tourists to come here to produce a good return for our economy, but also to introduce people from China to the fact that this country is what it is and is an area in which they can invest if they learn more about us. On an issue that I and a number of my colleagues have raised on a number of occasions, we have had assurances recently from the Government that these concerns are being taken on board. I hope that that is the case; I know that many from the Chinese community continue to monitor it.
We have an issue that came up about visas, with people applying from China finding that the documents that they need to fill out have not been in Mandarin. That is something that we have to address, when it comes to people who want to invest in this country, to ensure that the pieces of paper that they need to consider have been translated into Mandarin.
The point was also made that the regions of the UK should be proactive in helping inward investment, as well as the UK Government. The specific recommendation was made that each UK region should have at least one bilingual adviser in place. We as a country are not particularly as good at languages as some other countries are. I own up to this myself. Some of my colleagues have four or five languages but I struggle with one or two when I am a tourist—but beyond that, I have none at all. It is therefore important to encourage investment from China throughout the regions and ensure that regional advisers are bilingual.
There are many recommendations in this report and I hope that the Minister can confirm that it is being examined in detail, given that there is much to be gained by increasing investment to help growth in this country. I could go on endlessly but look forward to the Minister’s response because there is so much that we can gain. Perhaps I may quote from the report, which states:
“Compared to the country’s overall track record in attracting foreign investment, the UK’s performance lags with respect to China. Much of this potential gap is attributable to failures to recognise and adjust to the unique circumstances of Chinese investors. Faced with a lengthy and cumbersome approval process at home, and a relative lack of deal making experience abroad, Chinese investors take longer to agree to deals, are highly sensitive to price and perceived risks, and require additional levels of professional support throughout the process”.
I again thank the noble Lord, Lord Wei, for instituting this debate, and the Minister for being here. There is an awful lot to be gained by considering this report and the many recommendations within it.
From this side, we certainly welcome this debate. As the noble Lord, Lord Wei, observed, this issue is important for the future of the UK economy. The APPG is to be commended for producing this useful report, but the question is what Her Majesty’s Government will do about its recommendations—a matter that the noble Lord put pointedly to the Minister. The answer is not unimportant.
The report commends a strategic approach but any strategy requires sound content, otherwise it becomes mere public relations. There is much good work in the report but in this intervention I will focus on where more effort is required. That should not be taken in any way as a criticism of this report.
Let me begin with some general observations on the UK’s approach to date. Having, for example, the Prime Minister take an assortment of business people to China is no doubt well intentioned but it is hardly a strategy. If it is ill thought out, with no clear plan of what is to be achieved, it can easily create a wrong impression—an impression that perhaps our Prime Minister is being somewhat transactional. That is not a good outcome.
Furthermore, warm words of welcome to Chinese investors that are matched by an obstructive visa regime can be very unhelpful. The noble Lord, Lord Cotter, has given an example of that. Let me give another one. Last autumn, a Chinese ministerial party—I repeat, a ministerial party—seeking to visit the UK was held up in Beijing. Their flight slipped by while they were waiting for their visas to be produced by the UK Border Agency. If ministerial parties are treated in that way, it is hardly the right message to be sending to investors from China. I immediately accept that there have been some improvements on the past, but compared with France we lag way behind. If anything, there seems to be an unwillingness to match welcoming words with action. This does not go unnoticed by Chinese investors.
Having the UK welcome Chinese infrastructure investment is all very commendable, but unless there is effective follow up, initiatives may run into the sand. If due diligence on prospective investors is not carried out, one runs the risk of embarrassing failures, and there is no point rolling out a red carpet to Chinese investors if we ignore our domestic requirements, such as planning, consultation with potentially affected communities and due process, that can subsequently produce obstacles and upset the project. That can risk creating an impression of insincerity on the UK side. A focus on outcomes is essential to build good relationships. An intelligent focus is even better.
Turning to the report’s recommendations, I offer one caveat. It suggests we should,
“encourage the creation of more NGO trade promotion bodies”.
I respectfully suggest that this should be treated with caution. One criticism that has been voiced on a number of occasions by Chinese interlocutors is that there are already too many UK bodies speaking with too many different agendas in seeking a relationship with China. Focus on clear messages may be a better way forward. That may not require more trade promotion bodies for China, just greater clarity.
The report importantly refers to financial services. It identifies progress by London as an offshore renminbi centre. Renminbi settlement and clearing house developments are clearly positive, although they have not gone the full way as yet. More effort is plainly required. Singapore recently surpassed London in renminbi business. Paris, Frankfurt and Luxembourg all have ambitions to be renminbi centres. Her Majesty’s Government should take the initiative now. They should consider a currency swap—a real one, this time, not simply an emergency backstop—that creates liquidity on the market now. Another initiative might be purchasing renminbi for UK reserves. Her Majesty’s Treasury could do that, and it would be a step forward. The Bank of England says that it is not for it to decide this issue and that it is for the Treasury to decide. If the Treasury wants to make imaginative steps forward in our relationship with China, adding renminbi to the UK reserves would be a very substantial step. I commend that to the Minister, at least for consideration, although possibly it does not fall within his responsibilities. Many good speeches have been made on the theme of London as an offshore renminbi centre and some real progress has been made, but London has to regain its momentum to improve renminbi liquidity in the London market to make London in reality the—not a—major offshore renminbi centre.
The report refers to sector strategies, which is very welcome as it appears to be recognising a need for industrial policy, but there needs to be a certain coherence in it. Chinese equity purchase and M&A in the UK have been referred to. They have been welcomed in the UK. The noble Baroness, Lady Falkner, referred to this as an area where problems might arise, but plainly there is a tremendous opportunity for UK and Chinese business to go into partnership in these areas. However, as the noble Baroness pointed out, we must be astute to the possibility of Pfizer-type issues arising. Ed Miliband and, indeed, the noble Lord, Lord Heseltine, have made useful contributions to this issue and it appears that the Government have been listening to some extent, after something of a false start on this issue. As the noble Baroness pointed out, not every sale of a UK company to an overseas acquirer will be in the UK’s best interests.
The report correctly recognises the importance of sectors in manufacturing and services, and HMG can have a role in dealing with this. The needless damage of putting the UK’s EU membership into play may not be wise. Placing a question mark over the UK’s success in the automotive sector, based, as it is, in the UK as a platform for the EU market, is not constructive. The Minister will no doubt appreciate that the current Government continually making noises about splitting away from the EU is not an attractive invitation for Chinese direct investment in the UK to Chinese automotive manufacturers and others.
China is serious about outgoing investment, and we need to match its seriousness of intent. There are limits to government action, of course, but relations with China are an area par excellence where Her Majesty’s Government should be able to make a real contribution. This is vouched by the success of government efforts by Germany, Sweden, France and others in engaging with China, both politically and economically.
Everyone by now says relationships are key in China. The noble Lord, Lord Wei, directly recognises this. A rapid turnover of Ministers with the China portfolio is not a help—unless, of course, the Minister is not up to the job. However, there is also an issue in relation to civil servants. The approach to rotation of officials can be counterproductive: the despatch of personnel without sophisticated language skills to China can be less than ideal and the removal of real experts for personnel policy reasons is actively damaging.
There is a need for Ministers and officials, as well as businesses, to understand the very different Chinese culture. There is a need to build expertise on what may now be the world’s largest economy. Only knowledge and understanding of China will build a fruitful relationship. If the UK does not get serious, we will be an also-ran in what the Prime Minister calls the “global race”. However, if we work at building the relationship, the UK can indeed be, as the report aims for it to be, the favourite place for China to invest.
My Lords, I am pleased that we still have some of the Scottish contingent in for the debate. I start by thanking my noble friend Lord Wei for initiating this important debate and for the report from the All-Party Parliamentary Group for East Asian Business. China’s rise is indeed an opportunity, not just for the UK but for China, and I very much believe that this will be the decade of the Asian multinational. Our two Premiers described our two countries as “partners for growth” and we have seen notable progress in Chinese investment into the UK.
The noble and learned Lord, Lord Davidson of Glen Cova, raised a number of questions about the UK’s performance in relation to trade with China. I regret that some of the statements are perhaps a little out of date: our performance has certainly been weak historically but we are now making significant progress. Initial results for 2013-14 show a substantial increase in the level of inward investment from China. As my noble friend Lord Wei said, this is across a number of sectors, from property investment to infrastructure, manufacturing and nuclear, to name but a few. Announcements in press releases indicate commitments of upwards of £8 billion—a very substantial increase on past experience.
This growth reflects the efforts not only of the Government but of many groups and individuals including the APPG. It also reflects the success of government policy in making the UK an attractive place for businesses to establish themselves, to invest and to grow. However, I fully accept that there is clearly still much to do. The report highlights a number of areas, and I would like to address some of the particular points made in it.
The report recommended that we should provide additional regional support for inward Chinese investment. I should stress that the policy we operate, which I think has operated for some time, is based on the UK-first principle, where we try to attract inward investment to the UK and then spend time with the potential investor showing them regions that may be suitable for that type of investment. That said, we are doubling the number of partnership managers to work alongside local enterprise partnerships and enterprise zones to assist them in attracting inward investment. UKTI will continue to work with bodies to improve the local proposition, based around a region’s particular capabilities. We welcome, for instance, initiatives such as the Manchester-China Forum, championed by my noble friend Lord Wei, to promote regional co-operation and relationships.
UKTI does not typically recruit advisers with specific language skills but those with sector skills. However, we have in place sector specialists who are bilingual. In addition, we use the resources of UKTI in individual countries and have a large number of advisers in China as well as, of course, the FCO network. They assist with inward investment opportunities and marketing.
The report also recommends that the Government work together with NGOs to encourage inward investment and market the UK. I take the point that there are a number of these NGOs but the Government certainly work with a wide range of organisations, such as the China-Britain Business Council, the CEC—which was mentioned earlier—the 48 Group Club, UK-China CEO Dialogue and, of course, the APPG. I also recognise and welcome the point made about the diaspora community. As a Government, and as part of our trade effort, we should be seeking to use diaspora communities far more widely, in relation to trade not just with China but with a number of other countries.
Noble Lords, including my noble friend Lord Cotter, also raised issues of immigration policy. I have heard many of the same concerns directly. Although there are definitely issues, some of it is also perception. I will set out a few facts. First, the UK has more visa application centres in China than in any other country and 96% of Chinese visa applications are approved. The UK issued a third more visas to Chinese citizens in 2013 than we did in 2012, so we are making progress. There was a 9% increase in the number of study-related visas.
I wonder whether the Minister could focus not so much on the numbers of visas, but on the problems that the visa process creates: delay and complexity. That is what sends the message that you, the Chinese investor, are not welcome.
My very next words were going to be that the average time to process a visa is seven working days. Of course, there will be more difficult cases, but we also have a three-day to five-day priority service available. The Prime Minister, during his well thought through trip to China, announced that we would be trialling a 24-hour service this year. That received a standing ovation in the room he was in.
The Minister did say that I was out of date, but possibly he did not necessarily mean that in relation to visas. Only last week I had a party of Chinese investors saying that they were having considerable problems with delays in getting visas. These are people who wish to invest in the United Kingdom but are experiencing delays. Perhaps the information that the Minister is obtaining is out of date.
I am sure that if the noble Lord would provide me with some details of that particular party, we can look into what their challenges were. We are trying hard to make the process of applying for a UK visa easier. We have a pilot scheme allowing selected travel agents to make offline applications for tour groups using the same forms that are used for Schengen—with a small additional form—so that people do not have to enter the same information twice. We also have a select business scheme to provide key businesses wanting to invest in the UK with special services. There are currently around 140 members. The Home Secretary has announced the launch of the GREAT Club, an invitation-only account management service for the very highest-level investors.
I recognise that there are issues in relation to graduates. All graduates have a four-month period in which to apply for a graduate-level job, which allows skilled, well paid graduates to stay in the UK. I accept that the situation is not perfect. Significantly, we talk with the Home Office about how we can improve perception and what we can do around both policy and process. However, the situation has improved significantly. From talking to Chinese businessmen, which I do regularly, I know that they recognise some of that improvement. However, there is still more work to do.
I now turn to taxation. A competitive and clear tax regime has a role to play in attracting inward investment and is seen as a UK strength. I know the policy recommendation was that HMRC should translate its guidance into Mandarin, but it is not HMRC’s policy to translate tax returns into foreign languages, partly due to costs but also for reasons of equality of treatment. Having been a tax accountant in the long-distant past, I can confirm that nuances of languages can be very difficult at times, although there is of course an opportunity for professional services to advise on these issues. I will pass the comments regarding foreign languages on to HMRC, but it is not an issue that I have had raised directly by inward investors.
I welcome the comments from noble Lords on the importance of setting up as an offshore RMB centre. Over the past few years, we have made a lot of progress in changing some of the regulations and policy and in giving encouragement. We can debate whether London is a leading offshore RMB centre, but many would say it is the leading centre. We have certainly seen progress, but we know that there is more to do and we will be looking for further—
The Minister indicated I was out of date. He was perhaps not referring to the surpassing of London by Singapore as an RMB trading centre, which was noted at the end of February. Perhaps he would care to comment on that.
In currency trading, there are different time zones. I was a spot trader once upon a time in my life and used to take over from Singapore. We shall see how the figures on RMB trading come out for the full year. The UK has established a very strong presence in RMB, which is as a result of the Government’s policies and the changes they have made.
UKTI has created a number of sector organisations focusing on increased investment in areas such as automotive, life sciences, financial services, offshore wind, regeneration and innovation. They will help individual sectors and investment, not just from China but from other countries. They are not aimed just at China, but we think these sectors are important to show expertise in individual areas. In addition, we have a specialised group aimed at regeneration opportunities: RIO. This has been particularly attractive to Chinese investors and provides a pan-UK list of opportunities for regeneration in every region around the UK. RIO not only presents a playbook of opportunities but will guide potential investors through some of the barriers rightly raised by the noble and learned Lord, Lord Davidson.
This Government has a strong focus on building relationships with China. There have been numerous trade and ministerial visits, which are well thought out and well appreciated by the Chinese hosts. The highlight was the Prime Minister’s visit with the biggest business delegation ever assembled. More than half the companies that went on that were small companies. One of the important agreements signed during that visit was with the National Development and Reform Commission, to enhance trade and investment between the UK and China. As a result, and with the support of the British embassy in Beijing, the NDRC has launched the Chinese Enterprises Investment Guide to the UK, which is the first guide that it has published written for Chinese companies looking to invest in another country.
I shall pick up some points raised by the noble Baroness, Lady Falkner. The UK is proud of its position as an open economy, which we think has benefited the UK. It has created millions of jobs. When we talk about overseas investment, we have to look at JLR as an example of an acquisition that has helped the UK immensely and created value added and jobs. It is far less about the nationality of the company involved than its quality. We have public interest tests, particularly related to security, a key area which the noble Baroness raised, and areas such as media plurality. It is important that we look at the context of how much we have benefited. The UK will continue to position itself as open and to consider some of the challenges. I remind noble Lords that when we talk about AstraZeneca, Astra was a Swedish company; when we talk about GlaxoSmithKline, Smith, Kline & Co. was from Philadelphia. When we talk about openness, we have to remember that it is a two-way street.
The noble Baroness referred to diversifying into China too much. The challenge we have today is that we are not diversified enough. The EU has 45% of our trade and the US is our largest single market. It is this Government’s aim that the fast-growing markets should represent a larger proportion of our trade. The EU-China trade talks are just one of many trade talks. There are trade agreements being made and discussions going on with Japan, India, Singapore and the USA. We have recently concluded talks at the political level with Canada and we are discussing EPAs with many countries around the world. There is of course the Bali WTO agreement. This country is championing free trade around the world and will continue to do that on a plurilateral and multilateral basis, as well as on a WTO basis.
In conclusion, the UK has been very successful at attracting inward investment—we must remember that we are the number one in Europe for inward investment. It is the aim of this Government to improve our position in gaining inward investment from high-growth economies where historically we have not been successful, and of course China is number one in that list. We made significant progress in 2013 with multibillion pound investment across a range of sectors. We agree with the report that there is more to do, and we will do more. I thank all noble Lords who have spoken today for attending and for their interest in this subject. We have considered the report in detail and will continue to look at its recommendations. We will continue to engage strongly with government and non-government organisations in the UK and in China to make further progress and to make the UK the most attractive and successful investment destination for China in Europe.
(10 years, 3 months ago)
Grand Committee
To ask Her Majesty’s Government whether, in the course of their renewal of the BBC’s Charter and Guidelines in 2016, they will take into account the BBC’s coverage of European Union matters, in the light of its recognition of the need for greater breadth in such coverage following publication of the report of the Independent Panel led by Lord Wilson of Dinton in 2005.
My Lords, noble Lords will be aware that the BBC’s charter obliges it to be impartial, wide-ranging and fair in its political output, and that,
“no significant strand of British public thought is knowingly unreflected or under-represented”.
I should declare an interest in that, since 1999, I and others have been sponsoring an analysis of the BBC’s EU output to see if it is meeting those obligations in that area. This research can be found on the news-watch.co.uk website, and is the longest-running and most detailed analysis ever undertaken of the BBC’s output. As I said in my last debate on this, on 11 March 2002,
“bias, like beauty, is often in the eye of the beholder”.—[Official Report, 11/3/02; col. 653.]
The News-watch research now includes over 6,000 hours of the BBC’s EU coverage across numerous news and current affairs programmes. More than 8,200 individual EU reports have been fully transcribed, and transcripts from some 5,000 guest contributions have been collected and analysed. The director of the programme, Mr David Keighley, has had a long and successful career at the BBC and in commercial broadcasting, and his CV can be found on the News-watch website. He sits as a justice of the peace.
By 2004, Mr Keighley and his team had produced such damning evidence of the BBC’s Europhile bias, including a complete failure to air the case for the UK to leave the EU, which was already a significant strand of British public opinion, that the BBC set up its first and only truly independent inquiry chaired by the former Cabinet Secretary, the noble Lord, Lord Wilson of Dinton. That inquiry broadly supported Mr Keighley’s conclusions, and so in reply the BBC made the commitments to which this Question for Short Debate refers. However, I have time to deal with only two of them. The BBC said:
“With specific reference to Europe our aims are … to offer our audiences across all platforms clear, accurate and accessible information about the way EU institutions work and their impact on UK laws and life”,
and, secondly,
“to ensure impartiality by reflecting the widest possible range of voices and viewpoints about EU issues; to test those viewpoints using evidence-based argument or informed opinion”.
I am sorry to say that the BBC has not yet fulfilled those promises. Let us look at the first aim, which is that the BBC would make sure that the British people could understand how the EU works and how it makes so much of our law. With our elections to the European Parliament only 15 days away, I would have thought it helpful if our people knew what they were actually voting for and how it fits into the EU’s law-making process. I would have thought it helpful if they knew that the power to propose EU legislation lies with the unelected Commission, and that the power is exercised in secret; that its proposals are then negotiated, still in secret, in COREPER—the Committee of Permanent Representatives, or bureaucrats, who are appointed by the member states—and that they then go to the Council of Ministers for further clandestine discussion and decision, with the European Parliament enjoying powers of co-decision at this late stage in the proceedings; and that the Commission and the Luxembourg court then become the Executive and sole arbiter of all EU law. I would have thought that it would also be helpful if the British people understood how wholly irrelevant their Parliament here in Westminster has become in that process and how even our Government have only some 8% of the votes in the Council of Ministers, where it has been outvoted on every one of the 55 objections that it has made against new EU legislation since 1996.
I would have thought that it was the BBC’s duty under its charter at least to try to explain the above process to its licence fee payers, but it has not done so and is clearly determined not to do so. When I have raised this failure with all the chairmen and director-generals over the past 14 years, the answer has been always the same: “Oh, but the EU is so boring”. Well, it need not be. What about a new series of “Yes, Commissioner”? You would not even have to make the jokes up—the script would write itself from pure fact. Indeed, in UK Gold’s second series of “Yes, Prime Minister” last year, we saw Sir Humphrey explaining to a bewildered PM how the EU works, and very funny it was, too. I have sent the Minister a three-minute clip of that and would be happy to send it on to other noble Lords who want it. There is only one catch: Sir Humphrey says that the President of the Commission is elected—perish the thought. So even Antony Jay and Jonathan Lynn made a rare error on that one.
The other area where the BBC is in breach of its charter is in not allowing those who want to leave the EU the airtime to make their case. For instance, since 2005 the “Today” programme has allowed only some 0.04% of its airtime for withdrawalists to say why they want to leave, yet this is a view shared by upwards of 50% of the British people. The BBC almost entirely excludes Labour Eurosceptics from any debate on EU matters. Since 2005, only 0.09% of the “Today” programme’s guests on EU affairs have come from the Labour Party or the British left. The BBC prefers to view Euroscepticism through the prism of splits in the Conservative Party, with UKIP as the BNP in blazers— much more fun. It is not good enough for the BBC to reply that Nigel Farage has been on air a lot, if he and others are not given the space to explain how the EU works and, thus, the case for British withdrawal. There is one recent exception to that, as the BBC held a debate between Mr Farage and Nick Clegg recently. I suppose that it felt obliged to do so because LBC Radio and Sky had already done the same and it had proved rather popular. I bet that the BBC will not do anything like that again, if it can help it.
Finally, when the BBC deigns to commission what it pretends is an independent report into its output, the result is incestuous and incompetent to the point of dishonesty. I refer to the supposedly independent report last July by Mr Stuart Prebble, which has been taken to pieces by News-watch and exposed last month in a publication from the respected think tank Civitas, on whose website the whole depressing saga can be viewed. In a nutshell, Mr Prebble was not independent at all. He had been a colleague for many years at Granada TV of the BBC trustee—David Liddiment—who commissioned him and he had part-owned and run a company that made programmes for the BBC. He and the trustees commissioned the research directly from the former head of BBC news, Richard Sambrook, who is now at Cardiff University, where Richard Tait, a former editor of “Newsnight” and former BBC governor and trustee, also works in the same department.
Just for good measure, the Cardiff academic who led the research, Professor Karin Wahl-Jorgensen, had recently been employed by Brussels to analyse European media coverage about further EU integration and to discover why the UK is so sceptical about that prospect.
Unsurprisingly, Cardiff’s methodology was seriously flawed and unprofessional. It looked at only two one-month periods of the BBC’s output, in 2007 and 2012, which compares ill with the massive work done by News-watch over 15 years. Cardiff staff and friends in the leftwing media even managed to claim that their research showed that the BBC was biased in favour of Euroscepticism. They did this by simply ignoring 20 of the 21 pro-EU speakers on the “Today” programme in their 2012 survey period. Thus the Prebble report gave the BBC’s EU coverage a clean bill of health, which was, of course, gratefully accepted by the chairman, the noble Lord, Lord Patten, and the other BBC trustees. So far, the BBC has not replied to the Civitas-News-watch report, and Mr Prebble has merely accused them of running a smear campaign. I trust that the Government will join me in looking forward to a detailed response very soon.
So I ask the Government not to renew the BBC’s charter until they are satisfied that it is capable of fulfilling it. This afternoon, I have dealt only with the BBC’s coverage of the EU. Similar criticisms could be made of its coverage of immigration and manmade climate change, at least. In conclusion, I trust that the Government will ensure that the BBC’s editorial freedom is preserved, but with that freedom must come the fulfilment of the great ideals of its charter. I beg to move.
My Lords, I thank the noble Lord, Lord Pearson, for this debate and for a very good start-off to it, as well as for drawing my attention to this report, which I must admit that I had not read before—and that is clearly something I should have done. But, my goodness, how things have changed since 2005 when the report was written. Since then, being anti-EU has become fashionable; it has strong street cred—it is the urban of today. If anything, the way in which the BBC reports European issues has actually gone in the opposite direction. As the noble Lord, Lord Pearson, said himself, UKIP coverage has been quite extraordinary. I congratulate UKIP and the noble Lord, as a former leader of the party, on what it has achieved with no Members of Parliament but a strong MEP contingent. It is an important political movement in the country which gets huge coverage. Most of it, until two or three months ago, was almost completely uncritical, unlike the coverage of us rather more boring traditional parties, which suffer all the things that are thrown at us for all the things that we try to do in government or, indeed, in opposition.
The report of the noble Lord, Lord Wilson, brings a number of things to our attention. It states that there is no intentional bias, but goes on to say that informal bias has been shown in the past. The important message from that is still true: the BBC and the media more generally tend to report in terms of extremes, in that it is either all in or all out, or that we need somehow to partially opt out rather than stay as we are or go completely. It also talks about over-simplification, giving some examples. One that I remember well is where it looks at the,
“development of a European defence capability being treated simply as a scheme for a ‘European Army’”.
We heard about that mainly in the tabloid and popular press, but the BBC covered it as well, and of course it was far from the truth. There are some other points that the report brings up, such as treating,
“France and Germany as shorthand for the rest of the EU and failing to recognise the increased diversity of opinion following enlargement”.
That is an important one; it may not be so bad, but it is an area where we are still at risk.
One of the biggest areas since 2005, where the bias has been completely anti-European, is with regard to the euro crisis. Not only the Financial Times but the tabloid press and the BBC predicted constantly for about 12 months the break-up of the euro, although for me it was one of the most unlikely things that was going to happen. What has happened? Has the euro broken up? How many member states have left the euro? Two actually joined during that period. Did we hear a lot about that from the BBC? I do not remember hearing much about it. During the euro crisis, did the euro stop being the world’s second reserve currency? I do not believe so. Is it still? It absolutely is. Did the exchange rate actually plummet so that it was worthless? No, in fact, I think—my noble friend Lord Dykes will know better than I—it actually went up in value by comparison, certainly with pound sterling at the time, although that has probably slightly adjusted to our benefit over the past few months. Did we hear much about Hungary, a non-euro member that had equal economic and financial difficulties and needed a European and IMF bailout? I do not remember a great deal of reporting about that either. Clearly, there was a euro crisis and there were a lot of problems in terms of the way that Europe made its decisions at the time. However, in terms of its reporting, the BBC was absolutely and totally biased in a negative way and caused much of the feeling about the rest of Europe that reflected on that.
There is another area of concern. I remember writing to the BBC programme “Feedback” some years ago, before I became a Member of this House, to complain that although I liked listening to the “Today in Parliament” programme, there was no European Parliament coverage. Of course, I realise that I could be criticised here because the European Parliament accounts for only 9% of our legislation—or 7%, I think my party leader would say—but there is very little reporting at all of the European Parliament, which is an important institution in terms of the laws that are made in this country, as I am sure the noble Lord, Lord Pearson, would agree.
I would also ask whether we expect to have a sceptical or “anti” view of the international institutions of which we are a member. Is that something we should demand from the BBC? Have I heard a lot of criticism of NATO or a lot of bias against NATO? Have I heard anything on the BBC about removing ourselves from NATO? Should we actually come out of the UN? Should we have suitable “balance” from the BBC in terms of withdrawal from the IMF? The most important issue, of course, which we confront not in England but in Scotland, is whether we should have had, over the past five to 10 years, equal balance from the BBC about Scotland’s withdrawal from the United Kingdom. I absolutely think we should not have done, but that, although it is not the same, is a parallel and similar issue to the UK’s membership of the European Union.
I will conclude there. However, I was interested to see that John Humphrys of the “Today” programme added more fuel to the fire on this. He was slightly critical of the BBC but I was delighted that he was reported as saying that BBC staff were more likely to be liberal rather than conservative because they were the “best and the brightest”. I do not mean anything about my coalition colleagues by that—that was a small “l” and a small “c”—but I would like to think that as liberals, which I am sure that many noble Lords in this Committee are in terms of international politics, we are the best and the brightest. The BBC should remain balanced, but I believe that, if anything, the balance over the past five years has been in the opposite direction.
My Lords, it strikes me that everyone thinks the BBC is biased against their own personal viewpoint. Those on the left think it outrageous that business representatives are on the news more frequently than trade union leaders. They have also said that, although there is a general bias to political incumbents, Conservative politicians get far more airtime than anyone from Brown’s Government ever did. Conservatives think that the more obvious partiality of the 1970s and 1980s—admitted by Mark Thompson to be a “massive bias”—is still in existence today. We think that the BBC has pushed issues such as the bedroom tax without any grounding in fact. Indeed, Conservatives would argue that the BBC using the phrase “bedroom tax” is itself indicative of bias, given that it is not a tax at all. Perhaps this highlights part of the BBC’s problem: it has become too big, while still trying to maintain some semblance of balance.
How do we get an insight into the BBC’s world view? It may be reflected in the stories that its planners consider running on radio and television. Where do they get those stories? Last year it was shown that the BBC continues to purchase more copies of the Guardian—68,307 copies—than any other paper. It bought 58,000 Telegraphs and 60,000 copies of the Times. The Guardian has far lower circulation figures than either of those papers, not to mention the tabloids.
Having said that, I actually think that producers and presenters work quite hard to achieve balance in the BBC’s political output. It is very far from perfect, of course, but you cannot say that staff at the BBC do not try. However, the BBC plays an important role in deciding what is part of a reasonable debate on a given issue. If staff decide that a certain expert or group is not suitable to come on its vast number of political programmes to discuss something, that person or group is instantly seen to be outside the terms of reasonable debate—a pariah, an extremist, hard right or hard left. However, I am afraid that Europe is one issue on which the BBC tends to lose any sense of reason. Peter Oborne, in his publication, Guilty Men, for the Centre for Policy Studies, offers more examples than I can offer in this short contribution.
Many of these problems would be addressed if the BBC were to be reformed. The licence fee model is outdated, with the biggest change coming in the past five years or so. It is that watching television is not the only way to watch television programmes. Programmes are watched on phones, tablets, laptops, and they will be watched on devices that have not yet been invented. The BBC has its own iPlayer service, which, like its commercial equivalents, allows viewers to watch programmes wherever and whenever they like. Perhaps the best way to overhaul the BBC is to make it a subscription-based service.
A paper from the Adam Smith Institute outlined some sensible proposals. The BBC could, over a limited period, allow licence payers either to lapse or switch to voluntary subscription. The BBC would maintain a core public service function, funded by a much smaller government grant. “Public service” would be redefined to essentials. The core content would be free and include news, but entertainment and most documentary and factual output would not be free. That would make the BBC a 21st-century organisation, fully adapted to the digital revolution. Subscription models in the US show that people value choice. People will watch BBC material once they have chosen to pay for it themselves. These kinds of reforms would fix a far bigger problem than perceived bias: the monopoly features of the BBC, or at least its dominant market share. It currently has around 70% of the news audience, according to Ofcom.
I once had the privilege of running a monopoly, or at least a company with no competition, in the London taxi industry. I can tell you the truth of the saying, “Monopolies are like babies; nobody likes them till they have one of their own”. The BBC loves its monopoly and thinks that it deserves it. However, I can tell it that in fact competition, though scary to a monopoly, is good for it. You can never quite demonstrate the merits of a dominant business because the customers have no choice. Give them a choice, and wonderful things happen. The BBC can then be proud of its output and of its happy customers, rather than be proud of its monopoly while trying to ignore the thousands of customers criminalised in the magistrates’ court for not paying their licence fee.
There was a programme on BBC2 in March called “The Restaurant Man”, in which people gave up their day jobs to start restaurants. It was nothing at all to do with politics. In that programme, the presenter said, “Opening a restaurant just to make money is wrong”. That, to me, is where the BBC is at its most biased. I am not even sure presenters and producers know it, nor do they think they are doing anything wrong, but the cultural, metropolitan elitism is far more rife than any hard, political bias.
When it comes to the EU, it is clear that the balance of the coverage does not reflect the balance of the paying public’s opinion. Restricting a core grant for public service material will ensure a narrower focus and a much greater ability to ensure balanced output. It will save taxpayers money too.
My Lords, I congratulate the noble Lord, Lord Pearson of Rannoch, on initiating the debate, which in my assessment is important if only to signal the necessity for having a much longer, fuller discussion on this issue in your Lordships’ House at a later date.
It is very possible that there will be an “in or out” referendum on Britain’s membership of the EU over the next few years. An incoming Conservative Government are committed to hold such a referendum before the end of 2017. Labour has said that, if elected, its Administration will hold a referendum if there is treaty change in the European Union. In my assessment, at some point over the next few years there will have to be treaty change in the EU to consolidate the structural reform of the Union following the euro crisis.
A decision to leave the EU would be massively consequential for the country. I am at the opposite pole from the noble Lord, Lord Pearson—in other words, I am a passionate and committed pro-European. However, I hope that the noble Lord will agree with me that a referendum must be preceded by a fully open and informed public debate over an extended period. That is crucial if a referendum takes place. As by far and away the most respected and trusted national broadcaster committed to impartiality, the BBC should and must play a central role in such a public debate. I hope that the corporation will start to think about, and prepare for, the eventuality of a referendum now rather than wait until such a decision actually approaches. The past history of the BBC’s reporting on the EU shows how problematic and difficult its role will be.
The 2005 Wilson report was important and hard-hitting, as has been said. Eurosceptics have concentrated on the now famous liberal “institutional mindset” that the report diagnosed at the BBC. Just as important in my view was the documenting of uninformed reporting and the pronounced tendency to see the EU through what was called the “domestic or Westminster prism”. The BBC took the report seriously, as has been said, and made a large number of notable changes, including the appointment of a full-time Europe editor. Since then, a whole string of further reports have appeared, including the BBC Trust review of impartiality which came out in July 2013. However, I am a social scientist and I like hard data. More important in my view is the content analysis of the BBC news reporting carried out at Cardiff University from 2007 to 2012. That research emphatically refutes the view that conservative and Eurosceptic voices do not get a hearing. They in fact feature almost twice as frequently as opposing views: the supposed “liberal bias” has more than been corrected.
However, perhaps more importantly the research shows that the EU is presented largely in terms of infighting between domestic political parties rather than the issues at stake. Political figures also dominate. These findings run completely counter to what audiences covered in the research actually say they want—that is, for the ideological opinions of politicians, activists and special interest groups to be minimised in favour of factual commentary and impersonal assessment. As I have stressed, this is an absolutely core requirement, with crucial relevance if and when there is a referendum. It would be good to hear the Minister’s views on how such an outcome could be achieved, and on the proper role of the BBC in securing it.
My Lords, it is a great pleasure to follow the noble Lord, Lord Giddens, in this debate and to deliberately embarrass him by praising his recent book on Europe—Turbulent and Mighty Continent—which I read with great pleasure, but also with apprehension that things might not be so easy in the future. It is a book, however, that underlines his traditional support for Europe, which I share as well. It was more impressive than the book I wrote two years ago called On the Edge: Britain and Europe, about the danger of Britain coming out of Europe almost by accident and carelessness, rather than any—
I assure the assemblage here that that was not a pre-arranged conversation: it was entirely spontaneous. As usual, the noble Lord, Lord Giddens, was exaggerating in his latest remarks. Be that as it may, it is very sad once again to see that old apprehension and fear of the European Union coming out in the speech of the noble Lord, Lord Pearson, although we expect that kind of thing from him because he is against what he calls “the project”. Of course, however, most other people in most of the other member states—virtually all of them, without exception—are in favour of the project, and so am I. It will develop according to the wishes of the sovereign member Governments in that Union as they decide to work together through the integrated collective institutions. The European Parliament now has a 50:50 role, which I believe is a very good thing. I commend the noble Lord, Lord Teverson, as a previous Member of that Parliament, who was probably one of the pioneers of that eventual plan. We will now see much better legislation coming out of those institutions as a result of the EP’s greater involvement.
I do not agree at all that the BBC is biased far too much in favour of Europe: far from it. Its coverage has improved as a result of the recent suggestions referred to in this debate today and I commend it as a high-quality public broadcaster based on a financing system that has the confidence of the public. It is coming up for review again in due course. Once again, the dark gothic forces on the right wing of the Conservative Party will be agitating for the abolition of the licence fee, as they do every seven-and-a-half years on a regular basis, led previously by the noble Lord, Lord Tebbit. That will always persist, and I disagree strongly. I go to the United States a lot, and anybody who is not in favour of something like the BBC should have the misfortune of being forced to watch Fox TV, for example, or listen to Fox radio, which is even worse. The BBC has therefore led high standards of broadcasting, impartiality and objectivity on a massive scale in respect of most issues.
Of course, there has been a dumbing down from the competition—based on the television equivalent of the tabloids and comics that masquerade as newspapers in this country—and therefore the BBC itself had to do some dumbing down as well. That would include dramatising stories on Europe. I thank my noble friend and colleague, Lord Teverson, for the absolutely prime example of the euro and the way in which the BBC behaved. It startled many of its adherents and supporters in the way it presented the “fate of the euro”—so-called—as a result of the international banking, financial institutions and hedge fund crisis. It was not caused by anybody in Europe or in Britain, but mostly by people in the United States. I refer to the way in which the BBC said that the euro was on the verge of extinction: Jeremy Paxman used the word “meltdown”, implying that the euro was going to finish in a few weeks’ time. Paul Mason, one of their more polychromatic and overexaggerated correspondents—he now has a different portfolio—dealt with those matters as well, and he said that the euro probably had just a few days to live before it ended. That is a total travesty of the truth on any objective measurement, as my noble friend indicated in his remarks.
Take the euro as an example. It is essential to reflect on its reality as an international currency. It has three or four weak member-adherent countries of course, but look at what is happening now. People who were writing off Greece said that Greece in a few weeks’ time would have to leave the euro and have a new drachma, heavily devalued and so on, and it would not be able to manage. Portugal, just recently doing its first bond issue, is no longer asking for international assistance after three years. Greece is coming out of these tremendous travails. All of them voted solidly—the Greek Parliament, too, with big majorities; there was total public support from all the political parties, apart from the right-wing neo-fascist party—for the reality of supporting the euro as the greatest unifier of the developing economy of the European Union. It has been a massive success. Let us look at the most recent payments figures for the world. The euro is now an international reserve currency of immense dimensions. I should mention here that the United States is a much more heavily indebted country than any in Europe: the federal debt alone is $17 trillion. Fifty American cities are bankrupt and at least 50 states are on the verge of bankruptcy or, like California, they are already bankrupt, yet there are no complaints about the United States because it is the leader of the western world and it can do that: send the dollar out and the more people who buy it, the better. Will it go on forever? I doubt it.
The figure for the US reserve currency is now 39.5% for total payments transactions across the world, but the euro percentage is now 32.5%. It is getting closer and closer. Confidence in the euro—led by Germany as the strongest economy but also by France, which is bravely supporting the strong currency system—is high. Britain is afraid to do so after we were driven out of the exchange rate mechanism, and we have been afraid of the euro ever since. Devaluing is an easier option here, and that is what we do. We have devalued seven times since the war, three times by government action and four times in the marketplace. The pound is now not a very strong currency, as my noble friend Lord Teverson indicated. That will persist as the way out because it is the easy way out. The Italians did that but then they changed their minds and joined the euro, which is now benefiting Italy. That is a classic example of where the BBC went over the top because of the pressures in this country as a result of the atmosphere created by the Europe haters developing their political activities and political parties like UKIP, which will not last forever and I am sure is just a temporary phenomenon. Britain must regain its self-confidence as a proud international member of this community, as we are of NATO, the UN and other institutions. We must be an active participant in the European Union because if we are not, we will go down the path of loneliness, desolation and isolation.
My Lords, I hope I will be forgiven for intervening at this stage. I did not know that I would be able to speak, so I did not put my name down. The first thing I want to do is thank the noble Lord, Lord Pearson, for this debate and for his efforts over a long period of time at huge financial cost to himself, and perhaps others, at investigating the BBC’s coverage of Euroscepticism, if I can put it like that.
So far as I am concerned, I am a great admirer of the BBC, so I am not in any sense against the corporation, and indeed I do not believe that it can be financed in any way other than how it is financed at present, but we shall have to see about that. However, the fact is that I believe that the BBC has failed in its duty in respect of giving the Eurosceptic side of the European argument. I have myself made several representations both to the chairman and the organisation that deals with complaints, but with little success. I hope that the BBC will take note of this debate.
It is true that Euroscepticism is popular at the present time, but what is more important than ever is that when we come to have the debate on “in or out”, I am in agreement with the noble Lord, Lord Giddens. It must be an important and properly financed debate. We have to ensure that both sides are properly financed, not as they were in 1975, and that they should have equal time, especially on the BBC but also on other radio and television outlets. That is of the utmost importance.
My time is nearly up. I have to say that I speak as someone who was not in favour of joining the Common Market and believe sincerely that we would be far better off if we were out of the European Union. This country can thrive very well outside the European Union, and it is about time we had a big debate about what our future should be. Perhaps this debate will help us towards that.
My Lords, I am grateful to the noble Lord, Lord Pearson, for tabling this debate today. Like the noble Lord, Lord Teverson, I am grateful to him for drawing our attention to the report by the noble Lord, Lord Wilson, which was published before I joined your Lordships’ House. I was not aware of it before this debate, but I have now read it and found it very persuasive and perceptive. It raised a number of challenging issues about not just the BBC’s but the media’s coverage of European issues. Many of the issues are commonplace but, as the report quite rightly acknowledges, as the public service broadcaster, the BBC bears a particularly heavy responsibility for raising public awareness and maintaining a scrupulous standard of impartiality on this issue.
However, it is also clear that it was a report very much of its time—it is, after all, nearly 10 years old—and having read the BBC’s response and the commitments contained within it, it seems that a genuine and robust attempt was made to address the structural and presentational weaknesses covered by the report’s recommendations. For example, the BBC now has a specialist Europe editor and the BBC News website has its own dedicated European section. The “Daily Politics” and “Sunday Politics” shows have featured MEPs on 172 occasions, with 51 of 73 UK MEPs being interviewed over the past 18 months. On Fridays, “Today in Parliament” on Radio 4 includes reports from Strasbourg, and BBC News broadcasts a half-hour programme, “Politics Europe”, at the end of each Strasbourg session. More recently, the debate between Nick Clegg and Nigel Farage was broadcast on BBC2 and BBC News with an audience of more than 3 million viewers, so there is some evidence that the mechanisms for better coverage are in place.
Similarly, the BBC has visited and revisited the concerns regularly raised about impartiality, most recently in an independent report by Stuart Prebble which was commissioned in 2012 and to which the noble Lord referred. He drew on research from Cardiff University. The noble Lord said that he found its research untrustworthy, but that scepticism has been challenged and challenged again, and all the authoritative people who have looked at the research think that it stands up and confirms that a wide range of viewpoints and opinions on Europe can be found on the BBC.
While I do not think it is helpful to dwell overmuch on the Wilson report of 2005, I agree with some of the concerns raised by the noble Lord, Lord Pearson, and others about the lack of breadth and depth of coverage, which is a real challenge for us. This is a more fundamental challenge than simply requiring a review of the BBC’s output or, indeed, its charter because it stretches across from the media to our other democratic institutions. For example, there is a fundamental knowledge gap that needs to be addressed. We cannot lay that purely in the lap of the BBC. It starts at a much earlier level, in schools, where, as we know, political education is sparse and centred on UK institutions. Survey after survey of young people have shown that they have a real thirst for more information about what goes on in Europe. A European Parliament report shows that young people across the EU have the most positive feelings about Europe but also that two-thirds of them want to know more about its institutions and opportunities. This mood is reflected in a recent Anglia Ruskin University report which shows that 81% of British young people feel disengaged because they do not know enough about the EU, how it works and, above all, how it affects their daily lives. This is the point made by my noble friend Lord Giddens. There is a thirst for facts and information, not just for rhetoric.
This lack of information was reflected in the canvassing I was doing at the weekend. There was widespread apathy about the forthcoming European elections, a lack of understanding of the role of the European Parliament and a failure to grasp the range of social, environmental and economic benefits of the EU which impact on our lives. The challenge of filling this knowledge gap requires a greater commitment from all those involved in democratic and civic groups—we cannot lay responsibility for this solely at the door of the BBC.
Secondly, we need to recognise that one of the great strengths of the European legislative process is its focus on collaboration and negotiation. However, that very strength is also a weakness when it comes to media coverage as there are no gunfights at the OK Corral or headline-grabbing issues. A lot is done through deliberation, which is hard for the media to report effectively.
Ironically, although I very much share my party’s commitment to reform of the EU, including greater democracy in its institutions, I also accept that an EU style of politics provides a great alternative model to an electorate who are sick of British adversarial Punch and Judy encounters, which are driving so many people away from our own political institutions and politicians in the UK. If the British media were only better able to capture the essence of European political systems, we could have a more meaningful debate about the nature of political reform both here and in the EU.
Finally, I will pick up on the noble Lord’s question—the fundamental one we are debating today—about whether these issues should be raised in the context of the renewal of the BBC’s charter. I hope the Minister will agree with me that it would be completely inappropriate to start raising issues of content when the charter discussions take place. This is a highly sensitive issue but it is important that we reaffirm the BBC’s editorial independence, free from political interference, when the charter is renewed. The BBC has its own processes in place for monitoring and evaluating quality and impartiality, which need to be respected.
I hope we are able to persuade the noble Lord, Lord Pearson, that we all bear some responsibility for extending knowledge and news about the EU. The debate should continue, but the BBC charter is not the right vehicle for dong this. I also say to the noble Lord, Lord Borwick, that it is not in our interests to attempt to weaken what continues to be a respected and admired institution through this type of criticism at this point in time. Quite frankly, I do not think we would be thanked by the electorate or by BBC viewers for doing that—it remains a much loved institution, something which I think all the polling would confirm. We have had a good debate but the charter is not the way to take this issue forward. I look forward to hearing the Minister’s response.
My Lords, I will respond initially to the last, important points made by the noble Baroness, Lady Jones, by reaffirming the Government’s commitment to the operational and editorial independence of the BBC. That should be reflected in everything that we do, including when responding to debates of this nature. Although it is tempting to get into the detail—about which we all have an opinion—that independence, objectivity and, indeed, the BBC’s charter obligation to deliver impartiality is the subject which is under debate here: whether it is actually fulfilling that commitment to impartiality under its charter obligation. I rather liked the introduction from the noble Lord, Lord Pearson, when he referred to bias being, like beauty, in the eye of the beholder. With the sweet coincidence of the ordering of the speeches, we then went from the noble Lord, Lord Pearson, to the noble Lord, Lord Teverson, and then to my noble friend Lord Borwick. I felt we got a wide range of the different perspectives that we have on this.
The noble Baroness, Lady Jones, raised another point about the thirst, particularly among young people, to learn more about the institutions and more about Europe. I think that point is particularly pertinent at the time when we are marking the 100th anniversary of World War 1. I certainly commend the work which the BBC is doing to highlight what was, in a sense, the genesis of the institution which we are now discussing.
The impartiality of the British media, particularly with regard to its coverage of controversial topics, has been a subject of great debate in recent years. We have talked about the report by the noble Lord, Lord Wilson of Dinton, which was published in 2005 and predicated on the basis that there was then going to be a referendum. The BBC wanted to engage with the issue of what its position should be if a referendum actually took place.
We know that a referendum did not take place. That deals with one of the points raised by the noble Lord, Lord Giddens, and others about the position of the BBC and whether it should have a role to play in a forthcoming referendum. The answer is that it most certainly should, and the form of that will need to be decided.
We should not diminish that record of impartiality. Opinion polls carried out by MORI show that 76% of adults regard BBC News output as accurate. That is not to be complacent, but it is a trusted source, and the reason that the BBC must take its duties incredibly seriously. It is also the reason why, I guess, the BBC Trust decided to ask the noble Lord, Lord Wilson, to undertake the review in the first place. It was followed up in June 2007 by the safeguarding impartiality review. In July 2011, there was a review of the BBC’s governance operations in relation to impartiality, and in July 2013 there was a review of breadth of opinion, which was raised by a number of noble Lords. As the centrepiece of the UK’s public service broadcasting landscape, the BBC bears a central responsibility for providing balanced accounts of such matters as part of its mission to “educate, inform and entertain”. This is an important element.
My noble friend Lord Borwick made an important point about competition. I am sure that it will not have been lost on the BBC that while in certain age groups it is gaining market share for its news services, among the young it has been losing market share. Part of that could well be the wide range of additional outlets and news sources, primarily social media, which are now available, and there needs to be a response to that.
The BBC’s fifth public purpose, as set out in the current charter, is,
“bringing the UK to the world and the world to the UK”,
by building global understanding of international issues and broadening UK audiences’ experience of different cultures. There is clearly a read-across here to balanced, impartial coverage of EU matters and the duty of impartiality. The noble Lord, Lord Borwick, raised an interesting fact about the newspaper preferences of the BBC, but it has an absolute duty. The charter review will provide the appropriate context to consider all aspects of the BBC’s scope, its purposes and its activities. The current charter expires on 31 December 2016, and the Government have yet to announce the process, timing and scope of the review.
In 2005, the noble Lord, Lord Wilson, led an independent panel to assess the impartiality of BBC coverage of the European Union and make recommendations for improvement where necessary. I accept the point made by my noble friend Lord Teverson that things have changed quite a lot since 2005. Indeed, there is no cross-party consensus about the future. That is not just a UKIP point but a Conservative point, a Liberal Democrat point and, I am sure, a Labour point too. Markedly different views are now being presented to the electorate, not least at the present time, about how Europe should progress.
My noble friend Lord Borwick asked about the licence fee and the BBC Trust’s role in securing value for money. The BBC Trust is directly accountable to licence fee payers. Among its duties is to exercise rigorous stewardship of public money. That is clearly a very important role which we expect it to take seriously in future discussions. That will certainly be part of the ongoing review.
The noble Lord, Lord Pearson, focused on three points raised by the noble Lord, Lord Wilson, who raised 12 points in his report. Overall, there was a view that the BBC had demonstrated some cultural and unintentional bias and that its coverage of EU news needed to be improved and to be more clearly impartial. To address this, the panel recommended that the BBC needed,
“a strategy, action and changes, led from the top”.
As part of those efforts to address the breadth of opinion cited in its EU coverage, the BBC appointed its first Europe Editor, Mark Mardell. That was a point that was raised and welcomed by the noble Baroness, Lady Jones, and the noble Lord, Lord Giddens. Mark Mardell was appointed in May 2005 to focus on the evolving role and nature of the EU and its impact on the UK. In an interview with the European Scrutiny Committee in November last year, witnesses from the BBC described the appointment of the Europe Editor as:
“The biggest single thing, which made a real impact on air”.
In addition to this, the BBC has introduced new training resources and a mandatory course for journalists on reporting Europe. It has also commissioned regular reviews of specialist subject areas. A number of noble Lords referred to the interest in the debates that took place between Mr Farage and my right honourable friend the Deputy Prime Minister, which were watched by more than 3 million people on the BBC. That was something that, again, sparked discussion and debate in the country, which must be welcomed.
I turn now to other reports on impartiality and European coverage. Since 2005, a multitude of other reports have been published by the BBC Trust and the European Scrutiny Committee to assess the progress on the BBC’s impartiality in EU coverage. Most recently, the review of the breadth of opinion reflected in the BBC’s output, commissioned by the BBC Trust and led by Stuart Prebble, was published in July 2013. I accept that the noble Lord, Lord Pearson, made some strong remarks about the direction of that report. I think that it is creditable to the BBC that it takes its responsibilities so seriously that it sets up these reviews from time to time. It was encouraging to see that an increase between 2007 and 2012 in the breadth of opinion provided on the UK’s relationship to the EU had been identified. I am sure it was not nearly enough for the noble Lord, Lord Pearson, but some progress had been made. Overall, the report noted that, although continuous improvements could be made,
“the BBC goes to great lengths to provide a breadth of opinion”.
This point about breadth was the point made by my noble friends Lord Dykes and Lord Teverson and the noble Baroness, Lady Jones; we should talk not just about breadth but also about the depth of coverage. That is a criticism which the BBC has accepted and is seeking to respond to.
The more literature we have in that area and the more views that we have, the better it will be. This includes contributions such as the book by my noble friend Lord Dykes. I have not yet read it, but given that it has now had a citation and endorsement from Professor Giddens—the noble Lord, Lord Giddens—we will all, of course, rush to the library to obtain a copy, although perhaps my noble friend will be wishing that we rushed to Amazon to do so instead.
Qualitative polling undertaken by Ipsos MORI on behalf of the BBC in May 2013 found that, when asked which source of news people would trust for being the most impartial, 49% would choose the BBC, compared with 14% for ITV and 3% for Channel 4. It is important to highlight as part of this debate the fact that, under the terms of the charter and agreement, the BBC must do all it can to ensure that controversial subjects are treated with due accuracy and due impartiality in news dealing with public policy or matters of political or industrial controversy. This is also in line with section five of the Ofcom broadcasting code. The BBC has an invaluable role in providing information to licence fee payers to enable them to form their own views about a particular issue. To “educate” and “inform” are two-thirds of the Reithian values that form the heart of the BBC’s mission.
In conclusion, I thank again the noble Lord, Lord Pearson, for raising this important issue, and all noble Lords who spoke in this debate. We have much to be proud of in the way that public service broadcasters in Great Britain cover news impartially and accurately. To date, this has allowed the UK to build arguably the best broadcasting industry in the world, bringing benefits to the UK public and across the globe. Given that the BBC is central to this broadcasting landscape, and the unique way in which it is funded, it is essential that the BBC retains the public’s trust as an impartial purveyor of news and programming and of balanced coverage of all matters. It is critical that it continues to do this.
(10 years, 3 months ago)
Lords Chamber
To ask Her Majesty’s Government what response they intend to make to the findings of the Age UK report Care in Crisis on the impact of cuts to care for older people.
My Lords, social care is a priority for this Government, which is why we have allocated an extra £1.1 billion to councils this year to protect services. We are building on this by creating a £3.8 billion fund next year to join up NHS and social care services. Both health and social care need to work differently to respond to the needs of our ageing population, focusing on keeping people well and living independently for as long as possible.
I thank the Minister for his response. Age UK’s report found that social care cuts between 2010 and 2013 have resulted in 168,000 older people no longer receiving help with essential tasks such as eating, washing and getting dressed. The Nuffield Trust recently put the figure over four years at 250,000 people who have lost state funding support. In the light of today’s developments, can the Minister please comment on what is now happening to the Better Care Fund and when does he expect to update the House fully on why the launch of the fund has been delayed? The Minister knows that the fund basically uses resources already committed to shoring up the existing reduced level of services and that there is no new money in it. We now learn that the Cabinet Office says that the fund lacks financial credibility, in particular as to how on earth local hospitals are to save money to move care into the community in the current climate of substantial cuts. How does the Minister think progress can be made on the transfer to community care amidst the chaos and confusion into which this policy has now fallen?
My Lords, I can assure the noble Baroness that there is no chaos and confusion. As regards reduced numbers, which was where the noble Baroness started, the transformation in the service model that we are promoting focuses above all on prevention and is designed to enable people to live independently for longer, as I said earlier, so as to reduce the number of people who are dependent on formal care. Councils have told us that lower social care user numbers are partly due to the success of their core prevention work, but also due to increased use of re-ablement services for people who leave hospital to help them get back on their feet. As regards the Better Care Fund, there has been no delay there. We wanted to set aside enough time to make sure that all areas of the country have developed comprehensive plans for joined-up care. The better care plans start from April next year, as the noble Baroness is aware, and we have asked for early versions to be completed a year in advance so that we can review them, check their level of ambition and test how they will be delivered. That is what is happening now and we are broadly on track with the programme.
My Lords, people with autism spectrum disorder often spend much of their lives dependent on their parents, who are likely to die before them. In the light of the evident local authority distinction between critical and substantial eligibility thresholds, how will the Government ensure that people with autism are supported into old age by a social care system that helps those with moderate needs to live independently for as long as possible?
My Lords, the national eligibility threshold has been set at a level to reflect the most common current practice of local authorities. That will allow current practice in 98% of local authorities to continue as it does at present. The national minimum threshold will mean that people with autism, others who need care and carers will know what level of need is eligible for local authority care, no matter where they live in the country. I think most people welcome the element of the Care Bill that gave that certainty.
My Lords, one of the objectives of the Better Care Fund is to reduce demand on the NHS by improving preventive social care. Local authorities have sought to put more money into the Better Care Fund than the Government originally asked them to. Can the Minister say what the NHS’s response to the Better Care Fund proposals has been?
The short answer to my noble friend is that it is too soon to say as the plans are currently in formation. However, the whole idea of the Better Care Fund is to enable joint working. It is an opportunity to make the best use of available resources and improve value for money through the collaborative redesign of existing services. The pay for performance element of the fund should incentivise local areas to make efficiencies and will provide initial evidence of the impact of the Better Care Fund on savings and outcomes.
My Lords, the Minister will be aware that the Royal College of Psychiatrists carried out a recent survey which found that 11% of NHS trusts had cut specialist psychiatric teams that specialise in working with older people. A similar number of trusts are planning to disband their specialist psychiatric teams across the country. That is having a huge impact on older people who have to go all around the country for a specialist service. What assessment have the Government made in respect of those cuts?
My Lords, as the noble Lord is aware, specialised services are the responsibility of NHS England. We have charged it in the mandate and through regulations to make sure that there is comprehensive specialised cover for mental health services and other services throughout the country. For less specialised services, we expect the parity of esteem principle to apply, and CCGs are being held to account by NHS England to achieve that.
My Lords, what is the Minister’s response to the recent Nuffield Trust report, which warns that the Government are now “flying blind” in planning services for vulnerable older people because there is no way of assessing the true impact that social care cuts are having on their lives? Does he agree that the recent abolition of the Independent Living Fund, with no ring-fencing of the transferred resources, will only exacerbate the social care crisis?
My Lords, the Government are not flying blind on this issue. Social care has remained a priority for us, which is why in every year since 2011 we have invested significantly from the NHS into social care, and with a health benefit, as I mentioned earlier. That has enabled councils to give relative protection to social care in implementing their savings. The noble Baroness shakes her head, but the figures are very clear. Spending on adult social care services has been protected to a much greater degree than other service areas. One cannot expect them to be wholly protected. Local authorities have reduced spending on other services by a good deal more than they have on adult social care services.
My Lords, does the noble Earl accept that the real crisis in care for older people is the closure of many beds within local communities, which forces hospitals such as my own, Barnet and Chase Farm, to hold on to those people when they should not be in a hospital? They do not need medical treatment and are very vulnerable to hospital diseases. That is where the real crisis is. Barnet and Enfield is closing beds inside care homes, which affects not only the length of stay but the impact we have on older people, which bothers us greatly.
My Lords, that kind of issue should be absolutely central to the planning that the health and well-being boards undertake, with both the NHS and social services working together to ensure that there are enough beds from year to year. It is difficult to make generalisations about this. The noble Baroness mentioned her own area, which she knows very well. I am concerned to hear that Barnet and Enfield is straining in that sense, but, if she would like to speak to me about this, I am of course ready to see her.
(10 years, 3 months ago)
Lords Chamber
To ask Her Majesty’s Government whether they intend to honour the commitment made to review the Commonhold and Leasehold Reform Act 2002 10 years after its implementation.
My Lords, I beg leave to ask the Question standing in my name and declare that my interest is on the register.
My Lords, the Commonhold and Leasehold Reform Act 2002 introduced commonhold ownership and made numerous reforms to long leasehold law. Although the Government monitor the take-up of commonhold and continue to respond to concerns about the working of leasehold legislation, they have no current plans to carry out a formal review of the Act.
I thank the noble Lord, but it is 12 years since this law was passed and 11 sections are still listed as not in force, which seems rather a lot. Tenants and leaseholders, on the whole, are most interested in Sections 152 and 154, which provide for transparency and the protection of their deposits. However, we have had answers to Oral Questions in both Houses saying that the DCLG has a “watching brief” on this matter. Will he tell me how you move from a watching brief to a review, and which department would do that?
My noble friend is right that Sections 152 and, I think, 156 of the Commonhold and Leasehold Reform Act have not been brought into force. These deal with service charge information and the right to hold service charges in designated accounts. The Government consider actively whatever form of words is used, regardless of whether it is necessary to intervene by legislation. However, they are concerned with not overburdening either freeholders or leaseholders with unnecessarily elaborate provisions. They are also satisfied that, for the most part, the rights of leaseholders are protected by a number of provisions, some of which were brought in by the 2002 Act, particularly in relation to service charges, enfranchisement and protecting leaseholders from landlords in certain circumstances.
My Lords, does the Minister agree that—despite the attractiveness of the provisions that have been brought into force in the 2002 Act for many joint users of amenity premises, and indeed the popularity of such a system in many other common-law jurisdictions—it seems to have been almost totally ignored, both by practitioners and the general public? Is it possible that the rather ponderous procedures of registration at the Land Registry may be responsible? Have the Government held consultations with the Law Society and other appropriate bodies with a view to simplifying these systems and possibly making them cheaper?
I hope I understand the noble Lord to be referring to commonhold as one of the options that was made available by the 2002 Act. It is true that it was thought by all those involved with the legislation that there would be much greater take-up than there has in fact been in commonhold, which is popular in other parts of the world. However, the Government do not feel that it is appropriate to force people to go into commonhold arrangements. We welcome any attempt to bring it to people’s attention as an option. It is interesting that it is not taken up by any of those who write about the subject or by practitioners who should be advising their clients on whether it is appropriate. The Government stand ready to encourage it, in so far as it is appropriate for the Government to intervene in private arrangements.
The noble Lord the Minister must surely know that there are delays occurring between an application for a hearing relating to a right to manage and the First-tier Tribunal hearing the case. There is then another delay in getting an outcome. However, when I asked a Written Question on that, the noble Lord, Lord Newby, replied that such information on timings was not available. Surely the Government need to know things like that, to know how this Act is working. Will the Minister put the research in hand so that we can have such information?
As the noble Baroness will know, the question goes across departments—that for housing and the Ministry of Justice. I do not have the details available but I will certainly ask for inquiries to be made along the lines of the question.
My Lords, do the Government have any plans to control residential rents?
My Lords, the Government have no plans whatever to control rents. It appears that the party opposite is unsure as to whether this is a good idea. In fact, rental increases are below the rate of inflation. Last time, a rent freeze, which is partially proposed by the party opposite, caused the sector to shrink from over half to just 8%. Our intention is to improve the rental housing market, not to destroy it.
My Lords, I return to commonhold and leasehold and pay tribute to the noble Baroness, Lady Gardner of Parkes, for her tenacity in raising this issue on many occasions. Would the Minister be willing to meet some of the Members of your Lordships’ House who recently got together to look at these issues? We discovered that there are quite a number of relatively modest reforms which would make a difference to leaseholders’ lives but which at the moment are not receiving attention. Would he and perhaps some of his officials be willing to meet a group of us to discuss that?
I join the noble Lord in paying tribute to my noble friend for her tenacity, and indeed I pay tribute to the noble Lord himself for his consistent interest in this subject. I would be happy to arrange a meeting, probably involving the housing department as well as the Ministry of Justice. I will try to organise that in the nearish future.
My Lords, I think that we ought to hear from the Liberal Democrats. I always try to be very fair. On the first Question, there were five Labour questions, so I think that we should hear from the Liberal Democrats.
My Lords, as a member of the group that has met to consider these issues, I thank the Minister for saying that he will meet us. I will return to commonhold. It is quite incredible that many of us spent hours scrutinising the Bill well over 10 years ago. Since that 2002 Bill, there have been only 15 commonhold new developments and 152 units within blocks. That is not necessarily due to a lack of interest: there are significant obstacles for both old and new properties. Given the time that has been spent on this matter, I really think it is time that we as a Government looked at post-legislative scrutiny much more seriously, particularly in cases such as this.
My noble friend knows about post-legislative scrutiny. This Government and, I am sure, the Opposition are anxious to have such scrutiny in appropriate circumstances. The Act will take its place along with other legislation where scrutiny is appropriate.
(10 years, 3 months ago)
Lords Chamber
To ask Her Majesty’s Government whether they plan to amend the Health and Social Care Act 2012 to permit the Secretary of State to give day-to-day directions to NHS England.
My Lords, I beg leave to ask the Question standing in my name on the Order Paper and draw Members’ attention to my interests.
My Lords, the Government have no such plans to amend the Health and Social Care Act 2012. We believe that the power and responsibility for commissioning services should be exercised by the healthcare professionals closest to patients. That is why we legislated through the Act to establish autonomous local clinical commissioning groups supported by NHS England, an independent and accountable national body.
My Lords, that is a pity because the 2012 Act must be the most flawed piece of health legislation there has ever been. On the question of autonomy, first, can the noble Earl tell me why CCGs are not allowed to be autonomous and why they are subject to very overbearing, day-to-day control by NHS England? Secondly, because NHS England is discriminating against the funding of mental health services and against the precept of parity of esteem, why are the Government not intervening and telling NHS England to reverse its policy?
My Lords, I do not accept that CCGs are subject to unreasonable controls from NHS England. It is the task of NHS England to support CCGs and hold them to account, and that is what I believe it is properly doing, not least through the outcomes framework. Ministers are not intervening on the question of mental health funding because funding is just one part of the story when it comes to parity of esteem. We have set NHS England a strategic objective to make measurable progress towards achieving true parity of esteem for mental health. NHS England is responsible for allocating funds to clinical commissioning groups, which are best placed to invest in services that meet the needs of their local communities. However, we will of course hold NHS England to account for that. What we must not do is to single out certain elements of the equation at this stage.
Can the Minister say whether the Ministers in the Department of Health are happy that NHS England has recommended a 20% deflater to tariffs for mental health that destroys any possibility of achieving any kind of parity of esteem?
My Lords, we are not happy with that and, as I have said in the House before, Ministers have made it very clear to NHS England that this decision is both surprising and unwelcome in view of the need to maintain parity of esteem. NHS England, the NHS Trust Development Authority and Monitor are addressing this issue vigorously and we have regular discussions with those bodies to ensure that mental health services do not suffer.
My Lords, I wonder whether the Secretary of State now regrets supporting those aspects of the Bill—now an Act— that put him at a distance from interfering in the National Health Service and its agencies. Will the Minister nudge his colleague the Secretary of State to show that the level of micromanaging he is indulging in disempowers and disables the very people and organisations that his legislation put in charge?
My Lords, it is important for me to point out that the Secretary of State is acting entirely and properly within his powers. He is under a legal obligation to keep the performance of NHS England under review. That is in the Act. He would not be doing his job if he was not keeping in touch with NHS colleagues and talking and listening regularly to feedback about how things are going. He is accountable to patients and to Parliament and I do not think the public would expect anything less.
My Lords, given that many Ministers have spoken very clearly about the priority for parity of esteem for mental health and the answers that my noble friend the Minister has given to the noble Lord, Lord Hunt, and others, what more can the Government do if NHS England continues to refuse to allocate funding fairly for mental health?
My Lords, as I have indicated already, we view funding as just one part of the story in achieving parity of esteem. However, we will hold NHS England rigorously to account for this and we have regular meetings to talk about that. We have set NHS England that strategic objective and we have singled out in particular action on crisis intervention, extending access to IAPT therapies and developing options around access and waiting time standards. Therefore there are a number of detailed issues that we expect NHS England to address.
My Lords, can I ask the Minister to draw attention to one other area? I was alarmed to read in a recent POSTnote —the very last paragraph of a document that is often very factually based and helpful to the House—that HIV/AIDS is likely to suffer from being commissioned by one group, delivered by another and overseen by yet another. I am quite sure that that is an area where we would want good co-ordination, and I hope that the Minister will ensure that it is properly monitored.
The noble Baroness is right to draw attention to sexual health services as an area that needs to be joined up. We are very aware of that. The commissioning arrangements are as she has stated but we are as confident as we can be that in most areas of the country the services are joined up, even if commissioned separately. It is an area that we keep under review very closely.
(10 years, 3 months ago)
Lords Chamber
To ask Her Majesty’s Government what action they plan to take to conclude the European Commission’s infraction proceedings in respect of Eurotunnel’s structure and charges.
My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so, I declare an interest as chairman of the Rail Freight Group.
My Lords, I should like to take this opportunity to mark the recent 20th anniversary of services through the Channel Tunnel. The British and French Governments will move economic regulation of the tunnel from the Channel Tunnel Intergovernmental Commission to the Office of Rail Regulation and its French equivalent, and put in place a charging framework by March 2015. We are working with the French Government and anticipate that those commitments will be resolved by March next year.
I thank the Minister for that Answer. First, I thank so many noble Lords who have campaigned for many years to get the charges for the Channel Tunnel down. It looks as though the figure for freight will come down by between 25% and 40% which is a great achievement. I congratulate the Commission, the two Governments and, of course, Eurotunnel for reaching this agreement. Will the Minister now turn her attention to France, where there is a big problem? We can get through the Channel Tunnel more quickly and cheaply, but reliability and the general obstruction from the French railways are putting a serious stop on further traffic. Will the Minister encourage the Commission to go for the liberalisation package that is currently before Parliament and the Council to try to ensure that France is not the blockage to more traffic that Eurotunnel used to be?
My Lords, the Government are very committed to the single market. We have been strong supporters of the freight corridor strategies that will now extend from the Channel Tunnel through to London, as well as extending the reach across the continent. I take very much to heart the words expressed by the noble Lord, Lord Berkeley, and I will follow up on his proposal.
I am pleased to hear what the noble Lord opposite said about freight charges. Charges for passengers using the Channel Tunnel are so high that I ask my noble friend to consider whether Eurotunnel is abusing its monopoly position so that the market might be open to more providers and better services.
As my noble friend Lord Bradshaw knows, part of the agreement that predated the infraction, which is the subject of this Question, is that the Channel Tunnel Intergovernmental Commission will be replaced by the Office of Rail Regulation for the UK side of the tunnel and by its equivalent, ARAF on the French side. Their powers will be enhanced and they will put in place a charging strategy. My noble friend will be aware, however, that when the tunnel was built, to achieve that financing, certain concessions and rights were given, which obviously predate the relevant European directives. We recognise that we must honour those contractual commitments, although they have changed somewhat over time, as has the EU. I do not want to give too strong a commitment to my noble friend Lord Bradshaw, but I can say that the issues he raises are being looked at seriously.
My Lords, the Minister can bask in the congratulations to the Government and all those involved on the progress that has been made recently on the operation of the tunnel. Will she concede that progress has been due partially to the threat from the European Commission to take infraction proceedings against the British and French Governments unless there was improvement? In the areas of improvement that are scheduled, is she able to include the possibility in the near future of train services to Frankfurt operated by Deutsche Bahn?
My Lords, I am aware that a number of train companies are now looking at potential services through the Channel Tunnel. We would obviously welcome that as it expands the range of choice for people in the UK who wish to use the train. It would obviously create another avenue for tourism into the UK. As we build HS2, which will extend high-speed lines in the UK, it will enhance the use of high-speed and rail travel to the continent as well. I understand that there are no significant barriers; it is a matter of finding appropriate commercial arrangements, which I would leave to the commercial parties involved.
Is my noble friend aware that some 300,000 French citizens live in this country? Some estimates put it even higher, and the number is growing. Indeed, the Mayor of London, Boris Johnson, reckons that he is in charge of the sixth largest French city on the planet. Does my noble friend put the great and growing attractions of this country in French eyes down to cheap fares, or might it have more to do with the cautious but creative economic strategy being pursued so successfully by her right honourable friend the Chancellor of the Exchequer?
I can see that this is a wide-ranging question. Perhaps I may just say that, as a Londoner and as a true Brit, I find living in this country to be exceedingly attractive. I am not at all surprised that it is highly attractive to the French, especially those with an entrepreneurial turn of mind.
Is the Minister aware that the real moral of this story is that strong EU rules are needed to make the single market work in the interests of the customer?
I very much agree that a single market can exist only when there is effective regulation. The UK would have said that the prior arrangements had the necessary stamina, but we are very welcoming of the new shape of economic regulation that will have an impact on the Channel Tunnel as we go forward.
That this House resolves that the promoters of the Buckinghamshire County Council (Filming on Highways) Bill [HL] which was originally introduced in this House on 22 January 2014 should have leave to suspend any further proceedings on the bill in order to proceed with it, if they think fit, in the next Session of Parliament according to the provisions of Private Business Standing Order 150A (Suspension of bills).
(10 years, 3 months ago)
Lords ChamberMy Lords, I would like to place on record my thanks to all noble Lords for the spirit of collaboration and constructive criticism that has characterised our formal and informal discussions leading up to this moment. Your Lordships examined the Bill thoroughly when it started in this House, and made many excellent proposals as to how it could be improved. Many of these were taken up in the other place, and I believe that we now have a better Bill before us. Noble Lords’ suggestions have influenced not only the Government’s amendments but also the surrounding policy and our proposals for forthcoming secondary legislation and guidance.
In moving the Motion on the first amendments made in the other place, I hope noble Lords will think it convenient to consider a number of others, to which no amendments have been proposed. Many are small technical changes to clarify the provisions further and correct previous oversights. Amendments 1, 12 to 31 and 34 to 36 are minor and technical, and do three things. First, they ensure that cross-references to the Children and Families Act 2014 and consequential changes to it are accurately reflected in the Care Bill. Secondly, they include further definitions in the glossary at Clause 79(1) to ensure maximum clarity. Thirdly, they make further changes to fully reflect amendments in this House to remove the requirement for a transition assessment to be requested.
Amendments 2 and 3 relate to the issue of charging by local authorities and simply clarify the scope of the regulation-making powers, as I set out when we considered this on Report. They ensure that regulations can specify where local authorities do have the power to be more generous and contribute to the costs of an adult above the financial limit, as well as where they do not.
Amendment 4 clarifies that the regulation-making power at Clause 25(13) allows the regulations to specify cases where aspects of the care and support plan, including the personal budget, are not required. We have always been clear that there may be cases where aspects of care planning are not appropriate. An example is the inclusion in a personal budget of costs relating to the provision of reablement. This also reflects current practice and we intend to continue this arrangement through regulations.
Amendment 5 allows regulations to specify where certain costs do not have to form part of the personal budget, and thus do not count towards the cap on care costs. Again, it has always been the intention that some care and support provision, such as reablement, should be provided as a universal, free service and therefore should not be incorporated in the personal budget. This regulation-making power is limited to services that the local authority cannot make a charge for, or chooses not to. There is no way that this can apply to general care and support that the local authority can charge for.
Amendments 6 to 8 allow regulations to make provision for cases where a person with a direct payment has a period of fluctuating capacity, so that the local authority could or should, depending on the circumstances, continue with the original direct payment arrangements. This will provide continuity and prevent the direct payment having to be terminated.
Amendments 9 and 10 are technical amendments that address an uncertainty caused by a drafting omission. They make it clear that deferred payments, whether they are deferred charges or a deferred repayment of a loan, can either be paid back in whole or part.
I turn now to Amendment 32, which provides for a broad regulation-making power specific to appeals of decisions made under Part 1 of the Care Bill. This power gives us the flexibility to provide for a range of options depending on further work to ensure that we achieve the outcomes that people have told us are important to them. We will specify the details of the policy in regulations.
Given the changes introduced by the Care Bill, it is vital that individuals have confidence in the care and support system, and that they are able to challenge decisions without having to resort to judicial review. We held a consultation during the second half of last year on how best we could ensure this. Following this consultation, we have recognised the need for change. Amendment 32 will give us the scope to develop with stakeholders detailed proposals for an appeals system, keeping to the spirit of co-production that has characterised our work on other areas of the Bill.
This is an important and complicated issue and we need to make sure that we take time to get the detail right, drawing on experience from other sectors and ensuring that the changes are aligned with the broader changes to NHS and social care redress following the Francis report and the Clwyd review. We are working actively with our various partners and stakeholders to develop our policy on this, and we will consult further as part of wider consultations on regulations and guidance later this year.
As noble Lords may know, the Delegated Powers and Regulatory Reform Committee today reported on the amendments made in the other place to the Care Bill. It made two recommendations in relation to Amendments 32 and 46, which I am pleased to say the Government accept. Accordingly, I have today tabled Amendments 32A to D and Amendments 46A to E to give effect to those recommendations.
Addressing the first recommendation, Amendment 46B ensures that regulations made on the first exercise of the power in Amendment 32 establishing the care and support appeals process would be subject to the affirmative procedure. The remaining amendments respond to the concern of the committee as to the meaning of the reference to “modifying” an enactment. Our amendments spell out that the power is to provide that a provision of an enactment may apply with modifications. Similar amendments are made to similarly worded provisions elsewhere in the Bill to ensure consistency.
The amendments also ensure that where any regulations relating to the appeals process make provision that provides for a provision of an Act of Parliament—that is, primary legislation to apply with modifications—then such regulations must be made using the affirmative procedure. Again, in the interests of consistency, similar amendments provide that certain other regulations under the Bill—which might also provide for the modification of the application of an Act of Parliament —should be made using the affirmative process.
I turn to Amendment 33. Feedback from local authorities is that it would make sense for them to have the flexibility to be able to delegate functions relating to direct payments if they so wish. We agree, and have accordingly tabled an amendment to remove the prohibition around this.
My Lords, I thank the Minister for his full and thorough explanation of the Government’s changes to the Bill since it left this House. We will deal with each issue as it comes up. I will deal with Amendments 1 to 10, 44 and 46 to 51 on the Better Care Fund, and Amendments 12 to 39 on the care and support appeals process.
In light of today’s revelations about the Government’s problems with the aims and operations of the Better Care Fund, perhaps I might ask a couple more questions that follow on from the earlier exchange with the Minister on this matter. The Government’s technical amendments—Amendments 1 to 10, 44 and 46 to 51 —on the fund and achieving integration of care and support between the NHS and local authorities are straightforward. Of course, whether the fund can ever achieve what it set out to achieve looks like a very different matter.
The Cabinet Office review has found that the £3.8 billion fund lacks financial credibility. The Nuffield Trust says that it is based on “flawed logic”. The King’s Fund says that the aim stressed by the Minister earlier to get spending plans in place for the fund in time for the 2015-16 Budget is “completely unrealistic”. Its chief executive, Chris Ham, points out in today’s Guardian what many of us have been stressing all along, despite supporting the principle of and need for the fund; namely, that hospital budgets can be reduced only if much more care is already being provided in the community by GPs, community nurses and staff who are supporting patients in their homes. He says that just cutting NHS hospital budgets now would place,
“additional stress on an NHS already struggling to balance the books and maintain acceptable standards of patient care”.
Surely that is the point. Taken with the huge underfunding of local authority social care highlighted by the Age UK report Care in Crisis that was referred to earlier, this is the underlying problem that has still to be addressed. The fund does nothing to address the huge social care funding gap that has led to the cuts in social care support that Age UK’s report has highlighted, particularly the ending of help with essential tasks for older people, such as eating, washing and getting dressed. Those are the very services that help them remain independent and living in their own homes with a good quality of life.
The Minister says the fund has not been suspended, but there are clearly problems. Can the Minister give us any further details about the Cabinet Office review findings, and in particular the concern about the lack of detail about how the savings will be achieved? What is the timescale for the further review referred to by several newspapers and the specialist press today? Can the Minister explain how progress is to be made in enabling older people to remain active and independent at home or in the community when there is just not the funding or support available to help them?
Finally, on the technical amendments to the care and support appeals process, we welcome the Government’s announcement accepting the two recommendations from the Delegated Powers Committee and fully support these government amendments.
My Lords, I have just one issue to raise, on Amendment 32 and the Government’s amendments in light of the Delegated Powers Committee report. I speak on behalf of a number of people who are grateful that the Government have been able to respond very quickly to this. It is much more sensible for this to be an affirmative instrument rather than a negative one.
My Lords, in view of the press coverage today, perhaps I could ask the Minister to confirm a point. When the Better Care Fund was announced, the intention was that projects would start in April 2015. Is that still the Government’s intention or has the timescale been put back? What seems to me constructive is the move to have more engagement from the NHS in setting up the projects under the Better Care Fund. One key aspect of the Better Care Fund on which it rests is ensuring that there are enough strong and appropriate providers of community services to ensure that older people get the care in the community that they need.
The noble Baroness, Lady Wall, put a question during our earlier exchanges that went straight to this matter. You cannot simply close spaces in the NHS and expect that somehow people will be provided—magically, at a stroke—with services in the community. I quite see why people have leapt on this as a story, but I struggle to see the substantive issue. I go back to a point that was made earlier: how many times have we stood in your Lordships’ House and talked about integration of health and social care as being a desirable end that will deliver better services? It seems to me that the NHS may be questioning some matters to do with budgets. That is not a case for undermining the Government’s whole policy.
My Lords, I am grateful for the contributions of noble Lords. I will begin by clarifying that the Better Care Fund has not been suspended or delayed. My noble friend was absolutely right to say how important and long-awaited this initiative is. Successive Governments and leading health professionals have talked about joining up health and social care for a very long time. The Better Care Fund is a major step to making this a reality. It will be in operation from April 2015, which was always the intention. For the press to suggest that the scheme has been suspended is completely wrong.
The Cabinet Office implementation unit conducted a deep-dive review of the Better Care Fund in six local areas following the submission of draft plans. This was a small sample of the 151 plans across England and was based on initial drafts that have since been redrafted. The review found that the Better Care Fund is generating pace around service integration, but there are areas where improvement is needed. These include insufficient engagement with primary care and acute providers in the development of Better Care Fund plans and a lack of practical detail and clarity about how cashable savings will be released.
Since receipt of the Cabinet Office report, officials have worked with NHS England and the Local Government Association to improve the offer of support for local areas to address the issues that have been raised. To give councils the resources to start making progress immediately, the NHS will transfer an additional £200 million to councils in 2014-15 on top of the £900 million already committed. This funding will be used for social care with a health benefit and to prepare for the introduction of the Better Care Fund.
We are only half way through the planning and preparation process for the Better Care Fund and it is very premature to imply or state that the fund is in trouble—far from it. One would expect different areas of the country to progress at different rates; that has always been the case. Many areas of the country have been integrating services very successfully for a number of years, so it should not be surprising to anybody that some areas need to catch up. We are on the case, and so are NHS England and the Local Government Association. I am confident that, as I said earlier, we are broadly on track in this area.
Authority | Provisions imposing duty or conferring power to meet needs |
---|---|
Local authority in England | Sections 2, 18, 19, 20, 38 and 49 of this Act. |
Local authority in Wales | Part 4 and section 189 of the Social Services and Well-being (Wales) Act 2014. |
Section 51 of this Act. | |
Local authority in Scotland | Sections 12, 13A, 13B and 14 of the Social Work (Scotland) Act 1968. |
Section 3 of the Social Care (Self-directed Support) (Scotland) Act 2013. | |
Health and Social Care trust | Article 15 of the Health and Personal Social Services (Northern Ireland) Order 1972. |
Section 52 of this Act. | |
Authority (within the meaning of section 10 of the Carers and Direct Payments Act (Northern Ireland) 2002) | Section 2 of the Carers and Direct Payments Act (Northern Ireland) 2002. |
My Lords, I shall speak also to the other amendments in my name in this group. They respond to the excellent report from the Joint Committee on Human Rights and follow discussions that I have had with the noble Lord, Lord Low, and others. I am grateful to the Joint Committee and particularly to the noble Lord, Lord Low, who unfortunately is not able to be here today. I extend my thanks to my noble and learned friend Lord Mackay, my noble friend Lord Lester, the noble and learned Lord, Lord Hope of Craighead, and the noble Lords, Lord Pannick and Lord Warner, with whom I have had constructive meetings.
As has been said here and in the other place throughout the passage of the Bill, this Government need to send out a strong message to the sector not to allow abuse, neglect or harm. Our priority must be preventing harm, abuse and neglect happening in the first place.
However, Clause 48 as inserted by this House went too far. It applied the Human Rights Act to all provision of CQC-regulated social care. As the Joint Committee on Human Rights acknowledged, the Human Rights Act is not intended to cover entirely private arrangements. If Clause 48 became law, it would have been the first time that the Act applied directly to purely private arrangements where there is no state involvement. It could have led to other interest groups arguing that they should also be able to challenge private providers on human rights grounds in other spheres.
We still believe that much stronger deterrents are available. Many of the Care Quality Commission’s fundamental standards will include human rights dimensions. These standards will apply to all registered providers of health and social care, and failure to comply with them could be a criminal offence.
However, as I have just said, I am aware of the strength of feeling on this matter and that is why I am today prepared to offer a government amendment which I hope this House can support. The amendment would make it explicit that care providers who are regulated by the Care Quality Commission in England or by equivalent bodies in the rest of the United Kingdom, when providing care and support arranged or funded in whole or in part by local authorities, are exercising a public function for the purposes of the Human Rights Act. I hope that noble Lords will agree that this amendment meets the objectives of the Joint Committee on Human Rights. It makes it clear that providers of publicly arranged or funded care and support, both residential and non-residential, provided on behalf of a local authority to an individual, are bound by the Human Rights Act.
The Government were unable to accept the JCHR amendment as it was drafted for technical reasons. The Human Rights Act is an entrenched enactment which the devolved legislatures cannot modify, but its application should be the same across the UK. Government Amendment 11B therefore applies the legislative clarification to Wales, Scotland and Northern Ireland.
It is important to bear in mind that the scope of application of the Human Rights Act matters to lots of other people beyond the care sector. The Government believe that it is not appropriate to pick and choose which people or bodies are expressly made subject to the Human Rights Act. That is why I want to make it clear that this amendment would not set a precedent for any future occasions where there are perceived to be gaps in the coverage of the Human Rights Act. I hope that this amendment will be welcomed. I beg to move.
My Lords, I apologise to my noble friend for having missed the first few sentences of his speech. However, I heard the substantive part of it.
First, may I say on behalf of the Joint Committee on Human Rights, which met this morning, that the committee is absolutely delighted by how the Government have reacted to the problem that was raised in this House by the noble Lord, Lord Low, and many others, and which led to an amendment that—on reflection—was too strong? The amendment now tabled meets the problem admirably. The problem was created by an unfortunate decision of the Law Lords—by three to two—in the case of YL. As the Minister will know, the previous Government, like the present one, had been looking for an opportunity for that unfortunate judgment to be reconsidered in a suitable test case. However, no such case has arisen. The pity of it is that the whole point of the Human Rights Act was not to have a list of bodies that would be subject to the Act but to have a good, flexible test that would be fact-sensitive and would apply without the need for amendments of this kind. Unfortunately, no such test case has arisen where the matter could be properly decided, and therefore one has in a sense to use Elastoplast—sticking plaster—to deal with particular problems.
We quite understand the Government’s reservations about this being regarded as a precedent. As the Minister knows, ideologically there are some for whom the words Human Rights Act are almost anathema; that is why it required a certain amount of discussion to get to the present situation.
The Joint Committee sought clarification on just one matter. I do not think there is a problem; it is rather a matter of seeking confirmation that the Government intend the amendment to cover social care provided by a regulated provider and paid for by direct payments. It is not absolutely clear from the amendment that that is so. We think that it is so but is that correct? Do the Government intend the amendment to cover social care paid for by direct payments, provided that the care is purchased from a regulated provider? I am speaking extremely slowly, in order that others may be able to answer. No doubt others will want to say something about this amendment as well, but if that point could be confirmed in the Minister’s reply it would be very helpful. Nothing that I have said, however, should mask the delight we feel that this problem has been solved in this manner.
My Lords, I would like to say a few words about this group of amendments.
First, I thank the Minister for his helpful explanation. I particularly want to say some things on behalf of the noble Lord, Lord Low, who very much regrets that he is not able to be here this afternoon. His amendment sought to make it clear that the provision of regulated care was a public function for the purposes of the Human Rights Act, within the umbrella of Section 6(2)(b) of that Act. As noble Lords know, it was not accepted in the other place and we now have a government amendment which deals with that issue in rather different terms. It is a happy state of affairs to have that amendment in place.
The noble Lord, Lord Low, has authorised me to say two things. First, he very much welcomes the amendment and, secondly, he has asked me to express his appreciation for the way the Minister and his colleague in another place—Norman Lamb—have listened to the views in both Houses and have worked very hard to secure an agreement on the current amendment across government. The noble Lord, Lord Low, appreciates all the work necessary to achieve that, and he wishes me to stress his grateful thanks. I associate myself with these remarks.
Perhaps I may say one or two things in the light of what the noble Lord, Lord Lester, said about the case of YL. That was a decision by the United Kingdom Supreme Court, not by the Law Lords in this House. It was a decision by the justices by majority, and there it is. That decision stands as good authority for the point that it made, which was that while the regulation of privately provided care by a local authority was a public function, the private provision of care itself was not. The interesting point about the case arises at the very end where the noble and learned Lord, Lord Neuberger, said that if the legislature was unhappy with the decision and thought it appropriate, it would be right to spell out in terms that Section 6(2)(b) of the Act applied to private bodies whose provision of care and accommodation was funded by a local authority. That was what he was thinking at the time. The point he was making was that there would be a mechanism for dealing with particular problems in a particular way. That solution has now been worked out by the Government in the way that we see before us.
I respectfully suggest that by doing this, the Government are not setting a precedent. So far as the judges are concerned, they would not regard it as such at all; the precedent is in the Act itself and is doing precisely what the noble and learned Lord, Lord Neuberger, had in mind. I do not regard it as any disadvantage to do it in this way; it is very satisfactory that it has been achieved as it has. It is a precisely targeted measure which, as I have been trying to explain, is exactly what the noble and learned Lord had in mind.
I hope that I might be permitted to ask three short questions. I apologise to the Minister for not having given notice of them, due to the short time available since the amendment was circulated. The first relates to the list we see in the table at the end of subsection (3) of the new clause, which seeks to set out the list of the authorities to which the measure applies and a list of the functions intended to be covered by the measure. The question is, simply: can we take it that the intention is that this list should catch all the circumstances where care or support is arranged or paid for by the authorities listed there? We have not been able to check this for ourselves but I assume that that is the intention. It would be helpful if the Minister could simply confirm that that was what was being intended.
The second question relates to situations where a personal contribution, of whatever kind, is made to the cost of the care or support arranged by the authority. The arrangement is the authority’s but the individual makes some contribution of his or her own. Again, it is a short question: can we take it that the requirements to which that subsection refers will be met in that situation, the critical point being that it is the public authority that has made the arrangement? I would have regarded that as the touchstone as to whether or not this provision applies.
The third question is rather related to that, and to the content of the care package that is being provided. There may be cases, for example, where people with learning disabilities or mental health problems may need some assistance to enable them to participate in the activities that are being provided or get access to them. This question is similar to the second one. Can we take it that here, too, although these people are somewhat outside the scope of the other statute, the position nevertheless is that because it is the authority making and regulating the provision, the provision will apply to it?
These points aside, on behalf of the others on these Benches who have participated in these debates, I express my great thanks to the Minister and all those who have been working very hard to achieve the happy result that we have this afternoon.
My Lords, if it helps the Minister as he waits for some assistance in his response, I speak as one who has taken part in many of the discussions over the years. The Minister was right to acknowledge the work of a large number of people. One person who should be added to his list is the noble Baroness, Lady Greengross, who has worked tirelessly on this matter for some time. It is a measure of how long this debate has been running that when we first began to discuss it in this House, there were no direct payments for social care to anybody. Therefore, the matter did not arise. It is therefore extremely helpful that the Joint Committee on Human Rights has posed the question that it has. When we started, the scope to argue over what was a private arrangement and what was a public function was considerably less than it is now. Now, someone who has been assessed as needing and being entitled to social care may make an arrangement with a family member using a direct payment, but the question of whether it is a public function that is being discharged is still the one that goes to the heart of whether the Human Rights Act applies. It is extremely helpful that the Joint Committee has raised that question. Having got this far to overcome what has long been acknowledged as a tremendously unfair anomaly—whereby one older person in a residential home has rights and the person in the next room does not, simply because of who arranged, rather than funded, their care—let us get it right, at last.
My Lords, as I took part in the debate in this House that secured the original amendment to the Bill, I should very much like to associate myself with the remarks of thanks to my noble friend Lord Howe and to Norman Lamb and others in the other place. I think the root of this difficulty was the decision of this House from which Lord Bingham dissented. That was an indication that the decision might require revision in due course.
My Lords, on behalf of learning disabled people and other vulnerable people I should like to thank the Government for making this amendment, which certainly ensures that their care will be greatly attended to in the future.
My Lords, briefly, I also support the Government’s amendment on this long-running but vital issue. As the House knows, we strongly supported the need for the amendment. We, too, warmly congratulate the noble Lord, Lord Low, on his dogged determination and efforts to achieve this outcome. We also thank noble Lords from across the House who have helped to bring this about. On these Benches, we recognise that this was very much unfinished business from the Labour Government. We congratulate the Minister on the hard work he has put into finding a way forward and to getting cross-government departmental agreement, which has been important. We recognise that the amendment is a very significant step. I was going to ask for clarification on a couple of issues, but they have been raised in the debate so I shall leave it there.
My Lords, I am naturally very pleased by the welcome that these amendments have received from around the House. I should like to thank those noble Lords who have spoken for their extremely helpful remarks, not least the noble and learned Lord, Lord Hope of Craighead, and my noble friends Lord Lester and Lady Barker.
My noble friend Lord Lester asked me whether the amendment covers social care provided by regulated providers paid for by direct payments. The answer is yes, it does. The words used are: if the local authority pays “directly or indirectly”. “Indirectly” is to cover direct payments when the local authority provides the money to the individual who then goes to the regulated provider him or herself. I hope that clarifies the point.
The noble and learned Lord, Lord Hope of Craighead, asked me three questions. First, he asked whether the intention is that the list in subsection (3) of the new clause should cover all care paid for by all local authorities around the country. Yes, that is the intention: all relevant regulated care and support across England and the devolved Administrations is included in the list. It is our intention that the effect of this clause should be the same across the UK. We have worked very closely with the devolved Administrations to ensure that this is the case as far as possible. There is a potential source of confusion in the wording because in Scottish legislation social care is referred to in different terminology, but the net effect of what we are doing should mean that this applies in an even-handed way across the country.
The noble and learned Lord’s second question was: where a personal contribution is made towards the cost of care, will those situations be covered—that is, a situation where the public authority has arranged the care? Yes, the wording in new subsection (3)(a) in the new clause includes the words,
“paid for (directly or indirectly, and in whole or in part) by such an authority”.
In other words, even if the local authority funds only part of the care, it will be covered.
The noble and learned Lord also asked about the content of the care package and whether the fact that the local authority is providing the care means that those with learning disabilities and mental health issues are covered. All those who are receiving regulated care and support arranged by the local authority will be covered. That includes situations where the local authority itself is providing the care or support. That is the existing situation, the amendment does not change it and these people remain fully covered.
My noble friend Lady Barker asked whether the effect of what we are doing means that the provider is performing a public function. Yes, any provider covered by this amendment would be carrying out a function of a public nature in that instance. I hope that I have covered the questions as fully and clearly as noble Lords would wish, and I beg to move.
“Child’s carer’s assessment | Section 61(2) |
Child’s needs assessment | Section 59(2)” |
“Parent | Section 59(6)” |
“Young carer | Section 64(6) |
Young carer’s assessment | Section 64(2)” |
My Lords, I shall also speak to the other amendments in my name in this group. The trust special administrator regime is of course not revolutionary or new, but was set up by the previous Government in 2009 as a way of dealing with exceptional and intractable failure at NHS provider trusts. Your Lordships will also know that, since the addition of provisions for a single failure regime, which we have discussed previously, a foundation trust could be placed into special administration both for quality as well as financial failures, in the same way that an NHS trust could be. We are strengthening the regime through changes made in the Bill but this does not change the fact that it is only to be used in cases of significant failure.
There are various actions that could happen before the regime is even considered. For minor concerns at an NHS trust or foundation trust, the CQC will use its inspection reports and ratings to highlight concerns and to call for improvement. Breaches of fundamental standards could lead to a trust being prosecuted, or a penalty notice in lieu of prosecution. Where there are serious failings, the CQC will issue a new warning notice, requiring the trust to make significant improvement within a specified time. Monitor and the TDA also have a range of intervention powers; for example, Monitor is able to remove, suspend or replace foundation trust governors or directors. Monitor and the TDA can also place trusts into special measures, which includes partnering with a high-performing hospital, regular publication of improvement plans and a full leadership review.
Also, providers and their commissioners are expected to review the way that local clinical services are configured in the best interests of patients and in the context of quality and financial challenges. While a locally led service reconfiguration is not a panacea for all the challenges facing a provider, we would none the less expect options for reconfiguration to have been rigorously assessed. Ultimately, however, if it is impossible for a trust to turn itself around, it will be necessary to place it into the special administration regime, in order to safeguard taxpayer funding and the interests of patients. Trust special administrators would be appointed—and I make this point emphatically—only when all other suitable processes to develop sustainable, good healthcare have been exhausted.
That is the background to these amendments. I turn now to the amendments made in the other place. Amendment 41 would require any trust special administrator to consult formally other trusts, their staff and commissioners, who may be affected by his or her draft recommendations. This would match the extended remit of the administrator under Clause 118 with an express wider consultation requirement, ensuring that the final recommendations are informed by a proper understanding of the issues facing the entire local health system. Amendment 41 would also strengthen public and patient representation in the regime by requiring the administrator to consult local authorities in whose areas affected trusts provide services and local Healthwatch organisations in those areas. Amendment 43 is a minor and technical amendment. I hope that noble Lords will agree that the changes made in the other place further strengthen the regime and will offer the amendments their support.
I turn now to Amendment 41A tabled by the noble Lord, Lord Hunt, and Amendment 43A tabled by the noble Baroness, Lady Finlay. I hope that they will forgive me for addressing these amendments before they have been spoken to. The key underlying aim of these amendments is one with which I have complete sympathy, and I am grateful for the opportunity to make that clear in your Lordships’ House. It is absolutely the Government’s intention that essential services at other affected trusts should be respected during the process of trust administration just as much as the essential services at the failing trust. However, both amendments seek to achieve that aim by adding additional statutory objectives for the trust special administrator. I hope it will be helpful if I explain briefly why that is unnecessary and unworkable in practice.
My Lords, my amendment is Amendment 41A. As this is a new stage of the Bill, I declare my interests as a consultant and trainer with Cumberlege Connections, president of GS1 and chair of a foundation trust.
I am grateful to the noble Earl, Lord Howe, because we have clearly come quite some way since he introduced at Third Reading in your Lordships’ House the amendment relating to the rules on hospital closures. I hope, however, that he might see his way to moving a little further this afternoon. Closing hospitals is never an easy thing to do and I see a number of former Ministers in your Lordships’ House who bear the scars of hospital closure decisions. In my view, there is no doubt an urgent need to reorder and reconfigure services to allow for the centralisation of many specialist services to improve patient outcomes. Where the clinical evidence is persuasive, I would always support those service changes. We need to be more wary where service changes take place purely on the grounds of financial problems in a particular trust, especially if those changes have a negative impact on well run neighbouring services, where consultation is truncated and if there is an uneven playing field between the different commissioners—which is the subject of the amendment of the noble Baroness, Lady Finlay.
This all arose because of the problems in the use of the special administrator mechanism in the case of Lewisham. The South London Healthcare Trust was in huge financial difficulty; a special administrator was appointed and recommended that Lewisham hospital should have its A&E department downgraded and lose some other services as well. This caused outrage locally because Lewisham was not part of the South London Healthcare Trust, but was a well run and popular hospital, pitchforked into helping to solve a problem that was not of its own making. This ended up in the courts, which found against the special administrator and the Secretary of State. The judge concluded that the Lewisham GP commissioners had not given support to the proposal, which consequently constituted an additional reason why the decision of the Secretary of State could not stand.
The noble Earl, Lord Howe, always reminds the House that the legislative power that was used in the case of Lewisham was enacted under a previous Government. Indeed it was, but I stress that the original power was designed for something entirely different. It put in place measures to dissolve and rescue a trust through administrative reconfiguration. We never saw it as a vehicle for back-door reconfiguration across the health economy. The concern about Clause 118 is that it could allow hospitals to be downgraded or closed simply because they happen to be near a failing one.
I have listened carefully to what the noble Earl has said about the uses of this power. In both Lewisham and Staffordshire, where the power has been used in relation to the previous legislation that the noble Earl has amended, it has run into considerable trouble. In Staffordshire, where the process has also been used, an announcement was made in the last week or so that it has been put on hold. Essentially, the proposals of the special administrator have been roundly rejected by the local community, which shows the issues and problems when this mechanism is used to reconfigure services rather than simply deal with an immediate financial problem of a trust in great difficulty.
In the debate in the House of Commons, there was obviously much concern about this. The Government agreed that a committee should be established, under the chairmanship of Mr Paul Burstow MP, to produce guidelines on the trust special administration process. My amendment is simply designed to give those guidelines some statutory force. The decision of the Government to agree to this was very important and I am sure that, when the guidelines are produced, they will be sensible and set the context in which this mechanism can be used in the future.
However, my argument to your Lordships this afternoon is that it would give even more assurance if those guidelines had to come before your Lordships’ House and the other place for scrutiny and presumably for a decision to allow them to go through if they were found to be acceptable. I follow the precedent set by the Mental Health Act 1983, which gives Parliament a veto over the code of practice that provides guidance to those who undertake duties under that Act. The noble Earl has clearly moved a great deal on this issue over the past few days but it would be nice if he moved a little further.
As he responded to my amendment and that of the noble Baroness, Lady Finlay, perhaps I may save time for the House by asking him a question about the amendment that he has tabled in response to the noble Baroness. In his letter to us of yesterday’s date, he said:
“Our amendment would ensure that agreement is obtained from each commissioner on the basis that the administrator’s recommendations meet the objectives of the trust special administration and that they do so without harming essential NHS services they commission from any other affected trusts”.
He went on to say:
“Essential services at other affected trusts would be defined according to the same legal criterion that applies to commissioners of the trust in administration, thereby ensuring parity between all relevant commissioners”.
The wording that I want to ask the noble Earl about is:
“Our amendment would ensure that agreement is obtained from each commissioner”.
Does that mean that any one commissioner therefore has a veto over an eventual decision? That is how I read his letter. If so, does he agree that if that were used in the case of Lewisham, because the Lewisham CCG objected to the proposals, the proposals would not have gone ahead? If he does agree with my interpretation of his letter, how does he square that with what Dr Dan Poulter said in the Commons on 11 March, reported at col. 267? He said that while all local commissioners have an equal say, NHS England will arbitrate in the event of a disagreement. If, in the end, NHS England will arbitrate, that does not fill me with great confidence. NHS England will simply agree in the main with the original recommendations, because I am afraid that that is the track record of NHS England. In order to get absolute clarity here, I wonder whether the noble Earl could clear up any confusion around that.
My Lords, I wish to speak to my Amendments 43A and 43B. I start by thanking the Minister and the Secretary of State for the amount of time they have afforded to me in discussing the concerns that lie behind my amendments. It is indeed correct that I was concerned that one clinical commissioning group commissioning from a failing trust could have a disproportionate say over the future. The government amendment, as tabled, addresses those concerns and I am most grateful to the Government for it. It establishes parity of commissioners by ensuring that there is no harm to essential services. I am also relieved that the Government are stating that the same legal criterion will be applied. Therefore, standard-setting across the services will establish that parity.
One of my concerns relates to the guidance. I would be grateful if the Minister could confirm that the committee of which Paul Burstow is the proposed chair will continue to exist. I think that there has been a lack of confidence among the public as a result of the publicity surrounding what happened at Lewisham. It will be very important that the guidance is seen to be drawn up and reported on separately. I must admit that I am uncertain about the mechanism for that. However, I certainly would be concerned if the detail of how the process is laid out is not openly and independently reviewed. The current guidance has to be rewritten anyway and that process could restore public confidence.
My Lords, I welcome Amendment 40A and I am grateful to the Minister for listening to representations and responding to them. I always thought it was wrong that a special administrator investigating trust A could try to find a solution by plundering the resources of trust B, which was not in trouble, without giving it or its commissioning group the opportunity to make full representations. I also thought it was wrong that the Secretary of State could slip through what was in effect a restructuring of services in an area under the cloak of sorting out the problems in a particular trust.
However, there is a caveat and an unresolved issue that was hinted at by the noble Lord, Lord Hunt. The provision to put the troubled trust and its neighbours on an equal footing in terms of making representations should not be interpreted as giving other trusts a veto on all restructuring proposals. The present set-up of the NHS already provides more than enough pockets of resistance to change that may be necessary to achieve greater efficiency and higher clinical standards.
Such proposals for reconfiguration should be looked at on their own merits, regardless of whether the hospital concerned is a foundation hospital or has been developed using PFI. There should be no presumption that an error by one trust in the amount of debt it takes on should be visited on those who are unlucky enough to be adjacent to it. There could then be a stalemate at the conclusion of this process whereby the commissioners of the adjacent trust do not agree to surrender resources and services. The question then is how these issues are to be resolved, not simply in the context of the failing trust but in the context of the local health geography.
My Lords, we owe a debt of gratitude to the noble Baroness, Lady Finlay, for tabling an amendment to this Motion. I was present at the meeting yesterday, along with the noble Lord, Lord Hunt of Kings Heath, when we had a fruitful discussion on these issues. When I was the Member of Parliament for Orpington these matters were the bane of my life. The South London Hospitals Trust was a huge problem, as many noble Lords will be aware, with debts of around £150 million at one stage. Although at another period of my life I was a Minister for Health, I was specifically excluded from dealing with the problems of London hospitals because I was a London MP. It is ironic to get to a position of power where you might actually be able to do something for your constituency but then to be disempowered from dealing with it at all. None the less, that is the proper way to proceed.
It is worth bearing in mind that we have now got to a sensible position whereby there is parity in consultation, understanding and agreement between a commissioning group affected by the hospital trust’s special administrator and one which may be outside the trust and, therefore, nominally unaffected by it. Parity of esteem is the effect of the amendment tabled by the noble Baroness, Lady Finlay. I am grateful to the Minister for responding so positively on these matters: we have now reached a very sensible position. However, we should not believe that that is enough. It is a necessary condition for resolving some of these problems but it is not sufficient. Ironically, in the case of Lewisham and the South London Hospitals Trust, there was a very good consultation, called A Picture of Health, which lasted for two years and encompassed all the hospital trusts in south-east London. It was very extensive—and expensive, if I may say so—but it came to the wrong conclusion. The conclusion was that Lewisham should continue as a hospital trust on its own and that the other three principal hospitals—Queen Elizabeth, Woolwich, Princess Royal University Hospital, Bromley and St Mary’s, Sidcup—should all be put into one huge trust. That never worked and that particular trust has had to have special measures to deal with its financial problems.
That excellent consultation ultimately reached the wrong conclusions. Ironically, the rather more short-circuited consultations conducted by the special administrator led to rather better conclusions. We now have a solution on the Bromley side of things, as it is now a part of King’s College Hospital NHS Trust. It has effectively been taken over by it, which is a very sensible arrangement. St Mary’s, Sidcup is now doing other things—quite rightly because it is an old hospital and did not really have the facilities to run an accident and emergency department in the way that a modern hospital needs to do. Woolwich has been put in with Lewisham. We therefore have the makings of a better solution despite inadequate consultation. It shows that we do not merely need good consultation with everyone understanding what is happening; we need somebody to reach the right conclusions at the end of the day. I am referring here to the remarks made by the noble Lord, Lord Turnbull. He is absolutely right that there needs to be a way that the public interest—as well as the understandable more local interests—can be reflected, otherwise we will never make real progress.
The noble Lord, Lord Hunt, made the important point that there are really big problems. We all have scars resulting from the closure of hospitals that sometimes have to be closed. He will be aware of the report last year by the NHS Confederation, the royal colleges and the organisation representing the patients’ voice, which said that up to 20 general district hospitals in this country need to be closed if we are to have a sustainable hospital service and a sustainable NHS. If we do not close those hospitals over a period, after consultation and so on, we will be taking money away from other parts of the NHS, such as mental health and GP services, which are badly needed. We cannot afford to keep hospitals going when they are in need of change.
The way in which change needs to happen is becoming apparent—there is a general consensus. First, there should be more specialist hospitals. I note that the King’s Fund says that A&E departments, maternity care, neonatal services, heart services and stroke care are all areas where specialist hospitals can give better care than general district hospitals do at the moment. That is already happening in London, certainly in the case of stroke care. The number of hospitals has been reduced and stroke care has immeasurably improved, I think to the tune of 50% over the previous two or three years. Equally, of course, the other aspect of this improvement is bringing care back to the community and taking it away from hospitals. People do not want to go to hospital; they think they will get an infection or a disease, apart from anything else. People die as a consequence of being in hospital. We therefore need to bring care back to the community. However, all of that takes time.
I therefore agree with the noble Lord, Lord Turnbull, that we cannot allow ourselves to get into a situation where everybody defends every brick of every local hospital. We all know what happens. As soon as there is a threat to a local hospital the local MPs and the local newspapers get on their high horse, the campaigners come out and there are parades down the street, and no one can move an inch. I hope that noble Lords can see this legislation in the round. It provides for the proper, equal consultation of all interested parties, but we should not put road blocks in the way of necessary change in the NHS. If we do, we will have done the NHS a very bad service.
My Lords, I add the thanks of the Liberal Democrats to those that have already been offered for the help from the Minister and his officials since this matter was last discussed in your Lordships’ House. There have been a number of meetings and an enormous amount of correspondence during that time. A key part of that has been the definition of “consultation”, and how to ensure that services in another trust area rather than only an adjacent area are considered. I am particularly grateful because the amendment tabled by my honourable friend Paul Burstow in the House of Commons is broadly the same as today’s government amendment. I thank him too for his tireless work in expanding this. I very much appreciate the comments made by the noble Lord, Lord Hunt, in his amendment, which try to strengthen that.
However, I am not convinced that there is a need for further strengthening. The committee is there, and I hope that the Minister will be able to confirm that, following the request made by the noble Baroness, Lady Finlay. The committee is there to help set things up and ensure that the progress made as the special administrators start their work takes place in an appropriate fashion, and that every aspect of the consultation—which clearly has worried your Lordships—is addressed.
I want particularly to come back to the point about not considering only adjacent services. Much of the discussion this afternoon has been very focused on London, for fairly obvious reasons. However, there are issues around reconfigurations in rural areas, which do not mimic the pattern of a large number of hospitals in a fairly narrow space. Services may be much more scattered. That is why the word “adjacent”, to which others have referred, is not particularly appropriate. Quite often people will find themselves going not only to one area but beyond that area for a very particular service. It is important that the amendment laid down by the Government today makes it absolutely clear about the extension of consultation with those affected trusts.
My Lords, the disease with the greatest economic impact on the NHS is the disease of inertia. As the Secretary of State, Jeremy Hunt, pointed out in the other place during the debates on this issue, we are now four years on from the very public exposure of the problems of Mid Staffs and we have not yet made a decision. The trust administration procedures are indeed invoked only as a very last resort, but they are a very necessary one. I am very worried because, although the noble Lord, Lord Hunt, thinks that this government amendment does not go far enough, I am afraid that I think that the government amendment as it is goes quite a long way. I was much happier with it before we all started meddling with it.
The real issue is that we must start to make decisions, and we are not making decisions. We are allowing services to carry on producing bad care. We are allowing them to get into debt, which means transferring money from good services. It is almost never possible to reconfigure a bad service out of one hospital, or indeed to shut one hospital or service, without a substantial reconfiguration of services in another hospital. Unfortunately, it will always impose on the wishes of commissioning groups in another adjacent location or a little further down the line in a rural area.
I will, with reluctance, accept the Government’s amendments, although they add a little more consultation to the process. Please, however, let us go no further than that, and please let us not support the amendment of the noble Lord, Lord Hunt, which in my view would take us even further away from where we want to be.
I support the view that we ought not to have too many impediments to effective action. When this matter was first raised in this House, when the Bill was being considered, the amendment dealing with a special administrator came in very late and there was a certain degree of feeling that it should have been dismissed. But I am glad to say that the House decided to continue with it, and of course the matter has been carefully and fully considered in the other place.
The procedure for special administration may be needed quite urgently in some places in the not-too-distant future. I hope not, but there is a risk of that. Therefore, it is extremely important that we have an acceptable, effective service and provision in position to deal with the special administrator and his powers as soon as possible. I thank my noble friend and his colleagues for advancing to this extent.
My Lords, this has been an extremely helpful debate. I first pick up a point emphasised by the noble Baroness, Lady Murphy. Trust special administration is indeed a last resort, which was why I took care to spell out the other steps that we might expect to have taken place before administration is even considered. But the previous Government realised, rightly, that we have to have a mechanism in statute designed to deal with long-standing and apparently intractable situations in provider trusts—and not just to have a mechanism of that sort, but one that provides a reasonably swift resolution to the problem of significant failure.
The previous Government provided for a defined statutory timetable for the TSA process and they were absolutely right to do that. Indeed, as the noble Baroness, Lady Finlay, generously acknowledged, her own amendment, had it been accepted, would allow other affected commissioners to consult the public further about the administrator’s final recommendations. Consultation would be through the usual NHS process, taking about 12 weeks. It would fall completely outside the timetable of the trust special administrator and the net effect of such a change would be to reverse the effect of Clause 118. The administration regime would not be creating a complete and timely solution to the problem. It would render the strict legal timetable for the regime ineffective and delay what would be an uncertain resolution very significantly. I hope that noble Lords will not wish to follow that part of the noble Baroness’s amendment. I was glad to hear her say that she would not be moving it.
The noble Baroness asked me whether the committee to be chaired by Paul Burstow on the guidance will continue. Yes, it will. The Government’s commitment in relation to a committee chaired by my honourable friend to review the guidance still stands. The guidance is still important for setting out in detail how the statute should operate. The Government believe that there is significant value in advice from the committee about the guidance. She was right to say that that process should give the public and patients confidence that this is not a set of guidelines dreamt up by Ministers and civil servants on their own.
The amendment of the noble Lord, Lord Hunt of Kings Heath, suggests that the guidance should be laid before Parliament. I need hardly say that that idea falls considerably outside what is usual practice. It is not usual practice to lay statutory guidance before Parliament in the way that the amendment envisages. However, in recognition of the keen interest of parliamentarians in both Houses, we invited my honourable friend Mr Burstow MP to chair a committee of MPs and Peers to consider the guidance. I hope that that mechanism will be sufficient for the kind of buy-in from patients and the public that I have referred to, and will command confidence.
The noble Lords, Lord Turnbull and Lord Hunt of Kings Heath, referred to the situation where commissioners or providers declined to accept the administrator’s recommendation. The noble Lord, Lord Hunt of Kings Heath, asked whether a clinical commissioning group has a veto. Each commissioner of services provided by the trust under administration and affected trusts has to give agreement for the draft and final TSA reports to go forward, but NHS England has a role—which is already in statute—in deciding whether to agree the TSA reports if not all the CCGs agree. I believe that that is right. We cannot expect or oblige every CCG to agree to the TSA proposals in every single case. There has to be a way of resolving any lack of unanimity and this is the mechanism that we believe is right.
My Lords, perhaps the noble Earl will clarify that. If we take the case of south-east London referred to earlier, the trust special administrator would have produced its report, which the Lewisham CCG would not have agreed to, and so the TSA would not have had an agreed report. I suppose the risk is that NHS England or its regional office or a combination of local area teams would none the less have said that they would process the report, even without that agreement. As the noble Lord, Lord Horam, said, the eventual outcome was actually much better than the original recommendation by the trust special administrator.
My Lords, that last statement is a matter of opinion. We will have to see how the situation pans out. I do not want to make any judgments here and now, but I think there is a difference of view about that.
However, if one or more commissioners does not support the administrator’s recommendations, under existing legislation NHS England can still agree them, if, in its view, the recommendations achieve the objective of the trust special administration. Under our amendments, NHS England has that same role, but its decision would also be in respect of whether the recommendations harm essential NHS services at other affected trusts, and would look at both the definition of essential service and the existence of any harm. NHS England can therefore take into account the views of the commissioner which did not provide support on the basis that it felt the recommendations damaged the essential services that it commissions, and it would then decide whether the argument is convincing.
The noble Lord, Lord Turnbull, took that situation to the extreme and asked what happens if complete stalemate ensues between CCGs. In what we believe would be the unlikely event that a CCG made a decision which amounted to a failure to discharge its duties to act consistently with wider NHS imperatives, there are powers of direction by NHS England to ensure that those duties are discharged properly—but I emphasise that that would be a drastic and unexpected situation.
This regime is about ensuring that the TSA works closely with and consults formally all affected commissioners and providers so that they can input into, agree, plan for and adapt to any recommended pattern of services. CCGs must act consistently with the duty of the Secretary of State and NHS England to promote a comprehensive health service. Given that duty, we would expect CCGs to work closely and constructively with a TSA to avoid what one might call parochial decision-making and to take into account broader considerations for the delivery of publicly funded services in the interests of patients and the taxpayer.
In the end, the NHS must do the greatest good for the greatest number of people. On occasion and in exceptional circumstances, where a TSA is appointed, commissioners and providers may need to see local service change as a means of improving NHS services in the local health economy. I hope that those remarks are helpful by way of explanation and background to these amendments.
My Lords, this group covers issues relating to health and care data. I will speak to Amendments 45, 49 and 50. The Government are fully committed to the principles of the care.data programme and to the core principles that underpin its use, namely: to promote transparency in the quality of health and care services while at the same time protecting privacy and confidentiality; to promote health and care research; and to better integrate health and care services.
The data collected across health and care in England are the envy of the world. The care.data programme offers the ability to link existing data securely and safely in order to produce information that can save lives, quickly find new treatments and cures, and support research to benefit all of us.
I say at the outset that, in my view, the care.data programme is very good news and offers a great deal to help improve our country’s health and care system. However, in order to realise its huge potential, patients and professionals must have absolute trust in the way that data will be protected and used together with an understanding of why collecting data on such a big scale is important.
My Lords, I am grateful to the Minister for that full and helpful description of the background to this whole area of the use of confidential information. There is little doubt that public confidence in the uses to which their confidential information may be put has been badly shaken. For example, a number of recent revelations that access has been gained by one means or another by commercial organisations, insurance companies and so on has made the public—and many general practitioners—very wary and anxious.
That is why I want to put my own amendment, Amendment 45C, into the context of Amendment 45F, proposed by the noble Lord, Lord Owen, which emphasises a much stronger oversight by a statutory body: similar to, but stronger than, the Confidentiality Advisory Group chaired by Dame Fiona Caldicott, who commands such public respect and confidence. That is why I intend to support it if he moves it.
It is only against that background—of strong oversight and carefully controlled and limited access to such sensitive data—that we can even consider the very specific circumstances in which we can allow their use: not only legitimate use, but those uses which are vital for the benefit of the public and their health.
My Lords, I will speak to my Amendment 45D, although I may speak to the other two amendments, in the names of the noble Lords, Lord Owen and Lord Turnberg, as well, because they are relevant to the whole debate.
There is no question that the NHS has a rich reservoir of patient information. If we can exploit it to the full, its use could enhance care, aid early diagnosis and be a rich source of data for the development of new medicines and treatments. There is no argument at all here between the Opposition and the Government on this. The noble Earl reminded me that I took through legislation in 2002 that set the foundations for what we are now debating. He will recall that I was then arguing for us to use the potential of NHS information to the full. The noble Earl then, supported memorably by the noble Baroness, Lady Cumberlege, was a mite worried, I recall, about patient confidentiality. I think, however, that we reached a broad consensus that this is information to be brought together and used, but alongside safeguards that have public confidence. This is simply the issue that is before us at the moment.
Under the extension of the scheme, the Health and Social Care Information Centre can require GPs to upload patient data in an identifiable form from every GP practice in England. This will be linked to the Hospital Episode Statistics and other data sets. The information centre is a body corporate that can require a health and social care body to provide information—including confidential information. That is all well and good. The problem is that the centre and NHS England have botched its implementation, so much so that the scheme had to be withdrawn, originally for six months until the autumn, but my understanding is that the chief executive of the NHS, in evidence to the Health Select Committee, said that that date no longer applied. Perhaps the noble Earl could, when he winds up, comment on that.
My own view is that this is a dead duck. The Government will not be in a position to enable the scheme to go ahead any time before the election because so much public confidence has been lost. This is not surprising. Clearly, the information centre and NHS England took an inadequate approach in their public communications effort and there was a lack of effectiveness and accountability. It is clear that there are concerns about whether such information can be kept confidential in practice, and there is a worry that pseudonymised data could, in certain circumstances, be manipulated to identify a particular patient. There have also been concerns, referred to by my noble friend, about inappropriate use for commercial reasons, such as by insurance companies. I make a big distinction here: I would want the pharmaceutical industry to be able to use that information in research and development. That is absolutely legitimate.
There is also concern about general practitioners and their approach. Before the decision was made to suspend the scheme, there were worrying signs that a number of GP practices would not co-operate or would advise their patients to opt out of the system. It is important to recognise that we will automatically be part of the system as patients unless we opt out. Again, I agree with that principle. It is the only way to operate it. However, I am not convinced about having to go to my GP, if I can get an appointment, which is quite arguable at the moment, and having to talk to my GP—or, even worse, the receptionist—to say that I want to opt out of the scheme. There are real concerns about this system. Unless the GP body as a whole is confident that it is going to run with this, it will be destroyed because so many people will be encouraged to opt out that it will not achieve what it is meant to achieve.
I agree with the Royal Statistical Society which argues that we need a robust response to restore public confidence. Of course, I welcome the changes that the Government have made as a result of debates in the other place and in your Lordships’ House. The question, however, is: do they go far enough to restore public confidence? In my view, they do not. The Government have to make the bold statement that the system cannot be allowed to run under the people who are running it at the moment. They have lost people’s confidence. I cannot put this across strongly enough to the Minister: if you talk to organisations that know about the subject, you find that they are clear that they now do not have confidence in the people who are running the system.
That is why the Motion of the noble Lord, Lord Owen, is so important. He is basically saying that we need an external body that is independent and can give total oversight to the scheme. I support my noble friend’s amendment as well. I agree that it would be better in primary legislation than secondary, but there is no harm in having some secondary legislation to back up what we may agree in your Lordships’ House today.
In the Commons, the Government introduced amendments regarding the use of the term “promotion of health” for the purposes of the dissemination of information. Of course, “the promotion of health” could be a very open-ended definition. There was some fear in the other place that commercial companies—say, food and drink companies—could argue that they needed information for a public health campaign. My Amendment 45D seeks to provide reassurance by asking for regulations to be laid that are explicit about the circumstances in which information concerning the promotion of health can be used.
In supporting my own amendment, I say again to the Minister that there is no disagreement whatever about the importance of care.data, about the need for it to be successful or about the huge benefit to our country if it becomes successful. Success, though, is not guaranteed, and at the moment I believe it is unlikely unless the Government make changes. I hope that the House and the Minister will be sympathetic to these amendments.
My Lords, I will speak very briefly. I will not repeat everything that has been said but I support what was said by the noble Lord, Lord Turnberg, particularly about the use of data for biomedical and other medical research. I have been involved on several occasions with perinatal epidemiological research, and such data are vital for that. There is no doubt that we need to be certain that core data will be available for research purposes.
I had not thought that “the promotion of health” might be construed as applying to the food industry; I had interpreted the phrase to mean epidemiological and public health research. However, if the interpretation includes the promotion of health by the food industry, then of course I support it absolutely.
I would be content to have this in secondary legislation at this stage, as the noble Lord, Lord Hunt, mentioned. However, there is no doubt that the way in which the issue has been handled by Public Health England has lost confidence. It could have been handled better, and I hope that Public Health England has learnt lessons from it.
NHS England, not Public Health England. My apologies; sometimes I do not focus well, for reasons that are not obvious to your Lordships. I have some problems that occur. I mean NHS England. I wondered why the Minister was looking at me so curiously. I was about to check whether I was dressed correctly.
I understand that NHS England got this information to the public by doing a mail shot to every household. Some people received it but most people I have asked, among friends and family, do not seem to have done so. On top of that, the mail shot was not clear about what it was asking patients and the public to do. It was actually asking them to decide whether or not they wanted to opt out of their information being collected. That is the kind of process that has brought about a lack of confidence in how this has been progressed.
My Lords, I speak to my Amendment 45E. A recent comment article in the Lancet starts off with the words:
“Trust in the protection of confidential patient data in England seems to be at an all-time low given recent breaches in releases of patient data and the finding that hospital data have been sold to companies with insufficient oversight”.
There is no question or doubt that the research base in this country—particularly the base in pharmaceuticals and medical bioscience—is now at a very high level. Of course, it is because of this that there is a very strong debate over whether AstraZeneca should be taken over by the very large American pharmaceutical company Pfizer.
However, we also have to recognise in this debate that without confidence and the free exchange of information in this world of science data, research will be very badly damaged. Already we know that very serious members of the medical profession want to institute not the present opt-out system but an opt-in system. Most of us know that that will make great inroads into the effectiveness of our data. There are also some GPs who, because of their concerns, now actively encourage patients to use their right to opt out. This is therefore very urgent, and I welcome that the Government, in recognition of the crisis of confidence, have instituted a six-month pause. I understand that the pause has now been extended and that there is no artificial deadline.
In that context, there is another root cause for concern. We have been making data available to the pharmaceutical industry and other areas of commercial science for some time. Perhaps I should declare an interest. For 16 years—I am now off the board—I was on the board of Abbott Laboratories in Chicago, one of the very big American healthcare companies. However, well before that I was a neuroscientist at St Thomas’s Hospital and worked in the early 1960s with ICI, using its remarkable pharmaceutical research product, beta-blocker drugs—one of the great discoveries which led to James Black winning a Nobel Prize. I therefore have no need to assure noble Lords of my belief that a thriving commercial sector in pharmaceutical and other research is an important addition to the research that goes on in universities and hospitals up and down the country.
However, it is a fact that when you embark on a new extension of data being available to commercial operations outside the public sector, people demand and expect much higher safeguards. Before moving my own amendment and shoring it up, I looked very carefully at whether it was possible to get agreement on a mechanism to keep data in the public sector unless commercial organisations have expressed consent. That was seen by many people as blocking commercial activity, and it was not possible to reach agreement on it. That makes it even more important that we should have a statutory form of oversight.
The amendment I placed on the Order Paper proposes a new clause that would place on a statutory footing the current non-statutory Independent Information Governance Oversight Panel, which was set up by the Secretary of State. The present chairman, Fiona Caldicott, has the support of many people in this area, both in this House and outside. However, its present non-statutory terms of reference need to be given the authority of a statutory imposition. The new clause would also require persons and bodies across the health and social care system to have regard to its advice. It defines the relevant information; I strongly agree with the two previous amendments tabled by the noble Lords, Lord Turnberg and Lord Hunt. It is absolutely necessary to make it crystal clear what “promotion” means. It has different meanings in many different contexts—some perfectly acceptable and some borderline objectionable. There are other detailed aspects of the amendment, but it is pretty clear in its intent.
The medical profession is not the only body that ought to be considered in this. The Royal Statistical Society has made it clear that oversight and public trust in enforcement could improve the situation. It says that a new statutory body is likely to be needed to fulfil this role. Statisticians are as worried about the loss of confidence that is developing over medical data as anyone in the medical profession—they are the actual people who handle this.
I am pleased, indeed proud, that the amendment is supported by the Wellcome Trust. There is no better trust in the world than the Wellcome Trust. It is also supported by the charities that are associated with medical research, which also know the importance of the Wellcome Trust’s money and expertise. I have talked to the Minister about this and I will leave my comments for when I formally press the amendment, as I do not want to traduce what he is going to say to the House. He explained his position with his usual courtesy, but I remain of the view that, if we are to hold, restore and, in the future, enlarge public confidence—because I believe a greater exchange of information has huge potential—we have to listen to these concerns.
Whether we like it or not, people expect answerability, not just from NHS England, which is a quango, but also from the Secretary of State. Parliament has a role in this, and the issue is every bit as sensitive as some of the others that we brought under statutory oversight, such as embryology, the whole question of DNA and research into all these areas. We thought that they were so sensitive that Parliament should have a say, at least, and should know whether Ministers are taking actions that have qualifications, or even objections, from a statutory body so that we can make a determination. It is in that spirit that I will later seek to press the amendment.
My Lords, when many members of the public, and patients in particular, feel that their data may be mis-sold to insurance companies or other bodies that may use them either to increase premiums or for their own personal benefit, then we have a problem. Earlier this afternoon we had assurances from the Minister that that would not be the case. This must be information that is used for non-commercial purposes, which has been made very clear. It is important, too, to remember that patients can opt out. I have heard these expressions about the difficulties that they may have with GPs who might prevent their doing so, but they have a choice. They may well opt out. I believe that if we go ahead with care.data and provide the information as needed, many patients, in time, will see the benefits of this and will choose to opt back in.
We have also talked about the need, again, to have anonymised data and to prevent it going anywhere other than the non-commercial areas. Patients also have a right to decide what to do with their data; it is enshrined in the NHS constitution that they have rights on the disclosure of their personal data. I personally feel that all patients should have their own information—they should have their own notes. They should have a memory stick with their records and have ownership of their records. They can then determine, in the circumstances, where that information goes.
Many people are horrified by the idea of patients having their own records. I had experience of this in 1973, when I was a surgeon working in Ghana. Patients would come with their own notes, moth-eaten and dog-eared. The reason was very simple: if their notes were in the hospital, a certain bribe had to be paid before those notes could be released. Patients have always been suspicious about what happens to their notes. Give them to them—that is what I would say.
The proposal from the noble Lord, Lord Owen, for yet another layer of scrutiny above what is being proposed, is something that we should consider very carefully. He referred to the fact that it would be for the Secretary of State and NHS England to make those decisions. However, noble Lords will recall that when we debated this matter not that long ago, the noble Lord, Lord Willis, and others put forward a proposal for the Health Research Authority. If this Bill goes through, the Health Research Authority will have the authority to decide how information is disclosed. Therefore, I speak very strongly in support of the care.data programme. It is important for patients to be reassured and that point has been well made from all sides of the House. They clearly have to have that reassurance. However, I see no need for an extra layer or an oversight panel. That would provide just one more barrier for researchers to climb.
My Lords, the question that we are debating at the moment as we approach the enactment of the Bill is whether any extra words in any of these amendments are needed to provide more safeguards and greater public trust and confidence. The bit of law which is paramount but which has not been mentioned so far is the Human Rights Act. This Act, in Section 3, requires that all legislation, including this Bill, must be read and given effect to, if it is possible to do so, compatibly with the convention rights. One convention right, in Article 8, is the right to personal privacy. The Human Rights Act also provides that if any public authority, which includes the Secretary of State and any body performing functions of a public nature, were to breach the right to privacy, it would be liable to obligations, damages and other remedies under the Act. We do not have a written constitution which guarantees privacy; instead, we have the data protection legislation, which is broad-ranging, and the Human Rights Act.
The right to privacy requires three things. One is reasonable legal certainty where there is to be any invasion of privacy—one must know what it is for. The second is a legitimate aim—it must be done for a proper purpose. The third thing is that any invasion must satisfy the principle of proportionality—it must not be excessive. There is a lot of case law on this. Indeed, I was involved in one of the cases years ago in the Court of Appeal—called, I think, Source Informatics —which dealt with the lawfulness of supplying anonymised patient data.
I do not think it is sensible to add further language or further mechanisms over and above those that the Minister has described this afternoon. The more specific we become and the more we go on adding, the more ambiguities we create over what the additional words mean and how they might be interpreted. My view is that it is much better to use the Human Rights Act, the data protection legislation and the specific safeguards that the Minister has adumbrated very clearly today. In my view, they completely satisfy the right to patients’ personal privacy and I cannot think that adding these other words will add to public confidence. It seems to me that public confidence depends more on leadership and public information based upon the framework that we have.
Therefore, I hope that we do not divide the House on this. I hope that we are all able to agree that confidentiality and privacy are vital, as is public confidence, but that we should not overlegislate and overprescribe. In particular, we should not do so when we are considering Commons amendments at the 11th and a half hour before midnight, and we may later come to regret anything that we now add which creates further problems and further ambiguities.
I agree with the last comments of the noble Lords, Lord Lester and Lord Ribeiro. One of the problems that your Lordships’ House has faced with this is the issue of data used for research versus data used for commercial purposes. That becomes a very grey area when some commercial firms are doing pure research. It may be worth your Lordships’ House remembering that even commercial research, whether it is carried out by research departments or within universities and other research bodies, is bound by the strongest ethical codes in which we should all have trust and assurance because they are respected around the world. I would be grateful if the Minister could confirm again—I know he has already done so—that commercial data will not be released so that, for example, an insurance company could raise premiums for a particular group of patients. That is the fear that the public have, rather than the issue of using research data, for which we already have many structures and for which the Health Research Authority is properly the correct authority to make sure that the codes are followed absolutely. There is a difficulty in that pseudonymised and anonymised data can sometimes be undone, but that issue already exists in other research areas and there are plenty of mechanisms to hold researchers to account should they use any of that information themselves. I support the point of the noble Lord, Lord Lester, that we should be content with the Government and that if we start to overprescribe, we will end up unravelling some of the complex but effective arrangements that already exist in the research world.
Secondly and very briefly, I have previously raised with the Minister one very specific point on this issue, and I have asked him this question in writing in advance. Has there been any progress on the timetable for inclusion of primary care musculoskeletal data into the care.data programme? I understand that it was an unintentional omission earlier in the process but, given the number of people in this country suffering from musculoskeletal problems, it would be quite extraordinary if they were not included at an early stage.
My Lords, I would just like to say a few words about this because I am very involved in the whole world of IT, personal data and identification and the issues around examining the data. One of the things that has become apparent to me is that if care.data is to be effective, public trust must be maintained in it—that is the core problem. It needs to be there so that we can do epidemiological studies, and to do those some information will have to be in the database—such as postcodes, so that you can look for clusters and so on—which will potentially allow people to be identified. Once you compare it and link it across to other databases, if you are looking for someone who is of a certain age, a certain health profile and in a certain area down to 100 yards, it is fairly easy to start working out who they are by cross-linking. However, it may be important to take that risk from time to time, as long as it is done properly. What we do not want if this is to work is for people to feel a need to opt out. You cannot do epidemiological studies if half the population decide they are going to opt out. It is essential that the public trust the database, trust that they will be protected as far as possible and trust that the information will not be misused against them. That is the core to getting this whole thing to work, and if you fail on that you have had it.
The noble Lord, Lord Lester, made a very good point about the human rights stuff being in there and that we have the Data Protection Act and all these things. The Minister also mentioned the Data Protection Act. However, there are some challenges with this. One of them is how you bring a case under the Human Rights Act when a department or the health service is acting incorrectly. It is quite tricky; it does not happen overnight and you would be lucky to stop it. There are wonderful protections in the Data Protection Act but there is a certain amount of vagueness about exactly where the limits are and, worse still, it will all be changed this autumn or winter when the new European Parliament assembles. The proposals nearly got through before the coming elections. Under the digital single market agenda, a new Data Protection Act regulation will almost certainly come out of Europe somewhere towards the end of the year. That will have direct action in this country. We have no control over it as it is a European law that is directly effective in this country, and the Information Commissioner over here will be the person who will enforce it. We will have no say in whether it relaxes things too far or becomes too prescriptive in what it does. We cannot rely on it for certainty in the future
The noble Earl may not be aware that nothing that comes from Brussels will be able to offend the European Convention on Human Rights or the charter of rights with regard to EU action.
I fully agree with the noble Lord. My challenge with it is how easy it will be to raise a human rights case if we find that the regulation does not comply with something on which we have legislated here and there is a conflict. I accept that it is theoretically possible. I would argue that maybe the way proposed by the noble Lord, Lord Owen, is another way of trying to make sure that we do not have to go to that step.
Briefly, there are some commercial issues with this. One of the changes is that the National Health Service may end up giving away data that are all good for research purposes but which would be very useful for pharmaceutical development and stuff like that. Companies will make a lot of money from information that they get from the data, but I would like to see the NHS benefit. I do not have a problem with it selling the correct data if it is properly controlled for the right research purposes. There will also be some businesses and companies that will make a business out of analysing such data and selling the analysis back to the NHS. It would be useful because the NHS does not have the time or the skill to do that work, but the NHS should benefit from the work and effectively charge for the data that it sells.
There are two reasons why I like the amendment of the noble Lord, Lord Owen. On the Minister’s interpretation of statistics, if we take the more general wording, “the promotion of health”, and it is possible for the food industry to use it to bolster some of their stuff, we have to look at some of the underlying assumptions of the statistics, which can be dangerous things. We need to see how that is done. Even if we go for the newer wording in Amendment 40C, there could be problems in this area. I do not think that anybody is capable of regulating themselves. We always have our own internal biases towards our own objectives and can be regulated only by someone who is looking at it from another point of view, from outside.
We have had the Caldicott guardians for a while. The system works as they are looking after the public interest. They give the public confidence that things are not being misused in their names. Therefore, why are we throwing away a few years of experience of something that works? It is not tampering with the wording of the Bill or playing around with a mish-mash of words; it is merely re-establishing something that already exists. It is a sensible balance. If you cannot check yourself, checks outside the organisation have to exist. Therefore, I suggest that we support the amendment.
My Lords, I hope that the Minister will comment on a fact mentioned by the noble Earl, Lord Erroll: namely, that on its imminent coming into force the European data protection regulation will indeed supersede our Data Protection Act, which implements the current European directive. I am sure that the debate in Brussels has been conducted with the highest aims for the protection of privacy but I also believe that it is based on considerable illusions. It aims to introduce reliance on specific and explicit consent for each and every reuse of lawfully held data. This is an illusory standard. In the commercial world it works as we can tick and click as giving consent to terms and conditions, but it does not provide an adequate model for the world of medical research. I fear that when this draft regulation comes through, which it is very likely to do, we will not have secured better standards for the protection of patient privacy in research, and nor will we have secured the future of medical research.
This seems to me to be a very poor moment at which to have to make decisions on protecting the privacy of patient data, because the ground rules are about to change. They will of course be compatible with an interpretation of the European Convention, but they will change a great deal. I declare an interest as chair of the ethics, regulation and public involvement committee of the Medical Research Council, and as chair of the Equality and Human Rights Commission.
My Lords, this has been a very fruitful and excellent debate. I thank all noble Lords for their contributions. Before I address the amendments in the names of the noble Lords, Lord Hunt, Lord Turnberg and Lord Owen, I hope it will be thought to be in order for me to cover some of the questions that have been raised by noble Lords.
I start with the issues raised by the noble Lord, Lord Patel, who asked me a series of questions. First, he asked about the “one strike and you’re out” intention to which I referred. We believe that this will be a criterion that the Confidentiality Advisory Group, the CAG, will take into account in its advice to the HSCIC on the dissemination of data that might be used to identify an individual, so there is already scope for flexibility and common sense within this provision. We anticipate that the transparency of the information centre’s decisions to release data, which is provided for in the 2012 Act, would provide further safeguards and reassurances that a “one strike and you’re out” rule was being used appropriately—so there is flexibility. This is one matter on which NHS England in particular will want assurance as the engagement exercise proceeds, as will Ministers.
The noble Lord asked about accredited safe havens. I can commit that the Government will consult on proposals to introduce regulations before bringing forward any new regulations that would enable greater access to data for commissioning purposes, for example through accredited safe havens. As affirmative regulations, any such changes would be subject to debate in both Houses. Will personal identifiers be excluded from the collection? The information centre will of course need identifiers in order to be able to link health and care data from different settings. That is vital if it is to become the source of linked data that all sides seem to desire. Of course, this would be with the protections set out in the 2012 Act, to ensure that the information centre could release information that could be used to identify individual patients and service users only where there is a legal basis for it to do so.
The noble Lord, Lord Patel, also asked about effective links to the patient records standards board, to define the content of patient records. Following the department’s recent review of informatics governance arrangements, it has proposed a committee that will focus specifically on information standards: the so-called SCCI. That committee has oversight of the operational framework and supporting infrastructure to enable the appraisal and approval of information standards and collection across health and care systems in England. The committee will be the mechanism by which the patient records standards board will be able to engage with the delivery community and the wider system, in order to define and gain approval for the content of patient records.
The noble Lord, Lord Patel, suggested that there should be straightforward mechanisms for the personal opt-out. NHS England’s extension period and engagement processes do allow space and time for fuller listening, engagement and debate on that vital programme. As part of the process, I understand that a wide range of stakeholders—including the BMA, medConfidential, Macmillan and indeed the noble Lord, Lord Turnberg—are invited to regular advisory group meetings with the NHS England team. Those processes will be key to helping work through how best to provide reassurance and trust in the care.data programme, not least on how best to ensure that the opt-out process will work in practice and can be clearly communicated and understood by both GPs and patients.
The noble Lord asked whether I would assure the House that no changes to the law would be made to provide for access by commissioners to this kind of data without consultation. I can give that assurance. I can commit that we will consult on proposals to introduce regulations, as I have already mentioned.
The noble Lord asked whether I could say anything about secure data labs or fume boxes for handling data. Yes, I can say a little. I understand that the information centre is working to see how best it can implement this kind of technology. It is tremendously encouraging and could offer real potential benefit from the wealth of information held by the information centre without putting people’s confidentiality at risk. That is the potential benefit.
My noble friend Lady Brinton asked about the extraction of musculoskeletal data from GP records. I understand that NHS England and the information centre are working to ensure that musculoskeletal data will be included in the GP extraction.
The noble Lord, Lord Hunt, suggested that patients should not have to go to their GP to opt out—a point that he has made to me on more than one occasion in the past. This is mostly a matter for NHS England, but GPs, as data controllers, have legal responsibilities under the Data Protection Act for ensuring that all patients are aware of how their information is being used and shared. That does not relate just to care.data but to any use of data for wider purposes. They also have professional and moral objectives to ensure that their patients are informed about the use of their data.
I do not want to delay the House and I am grateful to the noble Earl, but he will know that there is a widespread concern about the quality of GP practices in some parts of the country. The first report of the chief inspector of primary care within CQC contained some hair-raising concerns. The idea that one of those GPs will be responsible for protecting data in those circumstances fills me with gloom and despair. Clearly, something will go wrong. If this ever gets off the ground, which I doubt in current circumstances, something will go wrong and the whole thing will collapse again.
At the same time, if anyone is going to come up with a better solution, now is the time. I have not heard one. In all seriousness, however, all GPs are well aware of the duty of patient confidentiality. I have never met a GP who has not been aware of that and conscientious about it.
The noble Earl, Lord Erroll, took us to the subject of the proposed European general data protection regulation, which is of considerable concern to the Government. We believe that clinical research is already highly regulated in the UK, so that the interests of privacy are effectively balanced against the value to the public that the research will deliver. The data protection proposals will, as I am sure he is aware, be subject to the co-decision of the European Parliament, the Council of the European Union and the 28 member states. Officials from the Department of Health are working closely with the Ministry of Justice, which leads on the negotiations with the EU on the UK's behalf, ensuring that stakeholders are engaged on key issues such as consent, the use of pseudonymised data, and when the legitimate interests of data controllers can be applied in order to process personal data.
We have also flagged up our concerns with MEPs on specific issues, including the narrowing of the exemption from consent generally and in relation to a rigid reliance on consent or pseudonymous data in order to process data. We strongly agree that we need to take a very firm position on research within the Council and are resisting all changes that would make the use of health data for research more problematic.
I turn now to the amendments themselves. In doing so, I not only thank the noble Lords who spoke to them, but particularly thank my noble friends Lord Lester, Lord Ribeiro and Lady Brinton for their supportive comments about the Government’s amendments and the Government’s position generally.
Amendments 45E and 45F would place Dame Fiona Caldicott’s independent advisory panel on information governance on a statutory footing to provide advice on information governance across the health and care system. It would require the Secretary of State and NHS England to have regard to its advice when making directions to the Health and Social Care Information Centre under Section 254(1) of the 2012 Act. The Secretary of State would also be required to have regard to its advice when making regulations to establish an accreditation scheme for private sector information providers. The amendment would also revoke directions made to the information centre by NHS England in 2013 to implement the care.data programme and to establish data services for commissioners.
Let me say immediately that we are sympathetic to the desire to see the oversight panel placed on a statutory footing. In an area as complex and important as information governance, it is essential that we have a source of clear, authoritative advice, available to all parts of the health and care system, which creates the right conditions for informed judgments to be made on the use of information, and on decisions to share or not to share. When the Secretary of State asked Dame Fiona Caldicott to chair the Independent Information Governance Oversight Panel, it was in recognition of her extensive knowledge and experience in this area. I agree with the noble Lord, Lord Turnberg, that Dame Fiona is uniquely well placed to lead the panel in providing strong, visible leadership to the health and care sector. It is our clear intention that the panel be best supported to do this. My department continues to work closely with Dame Fiona to ensure that the panel is equipped to deliver the role it has been charged with performing.
There may well be merit in establishing the panel in law and giving legal force to its advice on data sharing. I strongly feel, however, that on this important matter, so crucial to people’s privacy and confidentiality, to the safe and efficient operation of the health and care system, and to the research agenda, it is vital that we ensure the system of oversight, scrutiny and advice is robust and coherent. I undertake that we will explore with Dame Fiona Caldicott and all interested parties how best to achieve this, which may include using existing legal powers to establish an independent committee able to advise on data-sharing matters. Dame Fiona Caldicott has confirmed that she would explore options on existing legal powers to establish an independent committee and has noted the importance of considering further and clarifying the functions of the panel before doing so. I hope that those statements, as far as they go—and they are intended to be helpful—will reassure the noble Lord, Lord Owen, and other noble Lords.
I turn now to the directions made to the HSCIC by NHS England in 2013, covering the establishment of data services for commissioners and the implementation of the care.data programme, which would be revoked by this amendment. These directions, inter alia, describe the intended operation of the patient opt-out processes in the event that a patient objects to his or her information being shared. A key focus of NHS England’s engagement activity is to ensure that the opt-out process is implemented in a way that reflects the outcome of the listening exercise, and this will need to be reflected in the new directions to the HSCIC. As there will be new directions, it is not necessary and would be inappropriate to use primary legislation to revoke the current directions.
With those assurances and with a commitment to ensure that the oversight panel is supported to deliver its objectives—including a commitment to explore using existing legal powers to establish an independent committee to advise on data sharing—I hope that the noble Lord will see fit to withdraw his amendment.
It may be helpful to address Amendments 45C and 45D together as they cover very similar ground and, I believe, have similar intent. Amendment 45C would narrow the purposes for which the information centre may disseminate anonymised and certain other information under its general dissemination power. Government Amendment 45 provides that the information centre may disseminate information under its general dissemination power only for the purposes of the provision of health care or adult social care, or for the promotion of health. This amendment would replace the latter of these purposes with “biomedical and health research”, with the effect of curtailing dissemination for any other health promotion purpose. Amendment 45D seeks to define the health promotion purposes for which the HSCIC may share anonymised and certain other information under its general dissemination power in regulations.
I understand the concerns raised by some noble Lords that government Amendment 45 would allow commercial companies—including fast food and tobacco companies, for example—to access information under this provision for commercial gain. I hope I can offer reassurance that the scope of this provision will enable us to tap the potential of the wealth of data available for research, while explicitly preventing the use of such data for purposes that will not promote health.
My Lords, I was rather encouraged by the noble Earl’s initial remarks about strengthening Dame Fiona Caldicott’s committee and making clearer what role it might be able to play.
The problem I wanted to address in Amendment 45C is the uncertainty in the ways in which the words “promotion of health” may be interpreted. I know that the noble Earl has said that they cover research, for example. What about research that does not immediately seem to promote health? It is this rather vague term that I wanted to clarify. It is not about trying to unravel the legislation, as someone has suggested. It is about making it absolutely clear. I am afraid I was not very convinced by the noble Earl, and I beg leave to ask for the opinion of the House.
My Lords, for those who have not been in the debate I will try to deal with the specific responses from the different speakers. First, perhaps I may deal with the response from the noble Lord, Lord Lester. I agree very much with what he said. I believe that the European Court of Human Rights and the human rights legislation, coupled with the privacy Act, do enough to safeguard confidentiality and privacy. With respect, however, that is not what this amendment is essentially about. This amendment is essentially about how you release those documents, what the procedures and mechanisms are, and what the criteria are for release. That is what is so very sensitive at the moment. That is why we need the reassurance of outside scrutiny not only over NHS England, which is effectively a quango, but also over a matter as sensitive as the regulations that might come from the Secretary of State.
In his speech, the noble Earl, Lord Erroll, reminded us of the complexity of this issue. In fact, the issue is geared into a lot of the technology and science of how one collects this information. As for the noble Baroness, Lady Campbell, she warned us seriously about what is likely to come out of Europe, which could have profound aspects. I believe that legislation is coming. However, the key issue is what the noble Earl, Lord Howe, said in his speech. With his characteristic courtesy, he had already given me an indication of how he was likely to reply. Those who were present earlier will remember that I did not try to summarise his views; I thought it was more important that the House should listen to them. I listened as carefully as I could, and I do not want to be churlish about this—what he said was important and will give some comfort to people outside. He said that he was sympathetic to the desire to put an oversight panel on a statutory basis and I very much welcome that. He also referred to how Dame Fiona Caldicott was uniquely well placed to be the chairman of this body and, by implication, a new statutory body. I think that all the contributions from both sides have agreed on that issue.
The noble Earl said that there may well be merit in establishing the existing panel and went on to say that in his conversations with Dame Fiona, she said that she would look first at the question of statutory underpinning and then at it in terms of the relationship. The problem, as I explained to the noble Earl this morning, is that I should like to have a letter from the Secretary of State committing himself to that. Those of us who have been in government know that the time of the legislative committee is very much fought over: everybody wants to legislate but time is short. An unequivocal commitment to legislate would be necessary for me to withdraw this amendment, but, with respect, we did not get one. We got a lot of sympathy, and I hope and believe that legislation will come. I even hoped that the noble Earl would say, “The Government will be neutral. We are not taking a position. Let it go to the Commons and let’s see what the Commons view is”. I think that that would be helpful and would give him more time to build a consensus around the pattern and form of legislation.
If the House does not mind, I would like to ask for its agreement to this amendment—in the spirit that I believe that it would do a lot to ease the current suspicion and distrust over the whole issue of medical data, patient data and hospital data. I say to those who did not hear the speeches that no one in this entire debate has questioned the absolute importance of these data: they could be crucial for this country’s future in the biological sciences and in pharmaceutical research. If the issue is handled properly and with confidence, I believe that we can ensure that the number of those opting out—which is a natural right—will be very small. As long as the number of those opting out remains small then the data will be statistically significant and extremely important. The danger is that the number of those opting out could become quite substantial. I hope and pray that that does not happen. In our vote tonight, we will at least be showing those who are concerned that we believe that there should be a statutory underpinning. I beg to move.
(10 years, 3 months ago)
Lords Chamber
That this House regrets that the Civil Legal Aid (Remuneration) (Amendment) (No. 3) Regulations 2014 make the duty of the Lord Chancellor to provide legal aid in judicial review cases dependent on the court granting permission to proceed (SI 2014/ 607).
Relevant document: 37th Report from the Secondary Legislation Scrutiny Committee
My Lords, over the past 40 years politicians of all Governments have complained when they lost judicial reviews. However, when they calmed down they recognised that the principles created by the courts in this area of the law are,
“fundamental features of a constitutional democracy”.
I quote from De Smith’s Judicial Review, edited by the noble and learned Lord, Lord Woolf, Professor Jowell, and others. Lord Chancellors of the stature of the noble and learned Lords, Lord Mackay of Clashfern and Lord Irvine of Lairg, saw it as part of their responsibility to remind their ministerial colleagues of the importance and the political neutrality of judicial review. They understood that Ministers may be irritated by these cases while in government, but they welcome such controls when they lose power and move into opposition. The Lord Chancellor in this Administration, Chris Grayling, is by contrast a politician with a short-term mission. He wrote in the Telegraph last month that he is determined to prevent,
“judicial reviews, instigated by pressure groups, designed to force the Government to change its mind over properly taken decisions by democratically elected politicians”.
The legal aid regulations we are debating tonight are one example of many where the changes which this Lord Chancellor is imposing are far more damaging than any disease which they purport to treat. Legal aid is paid to a claimant’s lawyers only if the claimant satisfies a means test and shows that the claim has legal merit. Judicial review, unlike almost all other forms of legal proceedings, can be commenced only with the permission of a judge. These new regulations, which came into force on 22 April, make the following change. The Lord Chancellor must not pay legal aid fees unless the court gives permission to bring judicial review proceedings or, if the court neither refuses nor grants permission, the Lord Chancellor thinks it reasonable to pay legal aid remuneration.
The problem is that often the court does not grant permission to bring a judicial review for reasons other than the weakness of the claim. The filing of a judicial review claim concentrates the mind of the public authority, which often responds to the bringing of the claim by reviewing the impugned decision and by giving the litigant what he or she seeks: namely, recognition that an error was made or fresh consideration of the matter. Therefore, by the time the judge looks at the application, it is unnecessary, and may be inappropriate, for the case to continue.
These regulations wrongly assume that cases in which permission to bring judicial review is not granted are unmeritorious. Often the opposite is true. It is precisely because a claim has substantial merit that the public authority speedily addresses the grievance. The problem is that, if lawyers know that they have no right to be paid in such cases, even at the low—scandalously low—rates currently thought acceptable by the Lord Chancellor, the inevitable result will be that clients with a strong claim will find it much more difficult to find competent representation. Nor is it any solace that the Lord Chancellor has discretion to make a payment; that applies only if the judicial review application is not dismissed and some of these applications will be dismissed because the case is now moot. In any event, nobody can proceed on the basis of a hope that the Lord Chancellor, in his discretion, may choose to make a payment. We have all seen recently that the discretionary “exceptional circumstances” category of funding for legal aid applies in theory but rarely, if ever, in practice.
My Lords, I am a member of the Joint Committee on Human Rights and we are very grateful to the noble Lord, Lord Pannick, for initiating this debate. Our report, to which he has referred, and his speech say everything that I think could be said to explain the firm hostility to these proposals not only across the legal profession but across the committees of both Houses and the wider public. This will not inhibit people from saying the same thing again but I do not intend to be one of those; instead, I want to say something slightly different.
One thing that the Joint Committee on Human Rights referred to as a result of what is happening is the,
“conflict inherent in the combined roles of the Lord Chancellor and Secretary of State for Justice”.
We expressed the view that,
“the time is approaching for there to be a thoroughgoing review of the effect of combining in one person the roles of Lord Chancellor and Secretary of State for Justice”,
and so on.
During the passage of the Constitutional Reform Bill in 2005, I was one of those who supported the abolition of the old Lord Chancellor system and the creation of a new one in which a politician who was not a lawyer could become Lord Chancellor and Secretary of State for Justice. In my reforming enthusiasm, it seemed that that was a sensible thing to do. I deplored the conservatism of those who thought that this was ridiculous and that there was no reason why a non-lawyer—a lay person—could not be the Secretary of State for Justice.
I thought about my old boss Roy Jenkins, who was not a lawyer, and it seemed to me that he would have made an admirable Lord Chancellor because, although he was not a lawyer, he understood the rule of law. It was in his DNA—in his bloodstream. I could not imagine Lord Jenkins of Hillhead at any stage in his career becoming a populist Secretary of State for Justice who would forget about the importance of the independence of the judiciary, its role and the role of the independent legal profession, and the importance of judicial review. That was why, at that time, I supported the changes.
I am sorry to say that the previous Lord Chancellor, the right honourable Jack Straw, and the present Lord Chancellor have made me reconsider whether my enthusiasm was sensible. The previous Lord Chancellor, although a barrister, had managed in his period of office to behave in a way that I thought no Lord Chancellor would in flouting the judgment of the European Court of Human Rights and in going to Strasbourg to remonstrate with the president of that court about overreach and intrusion into the sovereignty of Parliament and so on. I do not believe that Lord Havers, Lord Hailsham, the noble and learned Lords, Lord Mackay of Clashfern and Lord Irvine of Lairg, or any of the traditional Lord Chancellors would have behaved in that way. That shows that you can be a lawyer and still not understand the rule of law. I know that what I have just said may be controversial on the Labour Benches but that is my view, having served him as an unpaid adviser for some 18 fruitless months.
However, the present Lord Chancellor is in a class of his own, because he is entirely miscast as Lord Chancellor. He would be perfectly cast in “House of Cards”. He would be an ideal person in that sort of role because he is a very intelligent, extremely charming, very effective politician. However, I am sorry to say that having seen him give evidence to the Joint Committee and generally, and seeing what he says in newspapers, I do not think he understands the rule of law. I do not think that you have to be a lawyer to do that but it might help if you have been part of that tradition. His legacy, I am sorry to say, is going to be bleak. People will look back on this period and the coalition Government and they will say with all the high statements made by both parties to the coalition about the rule of law—and for that matter the Opposition as well—extreme damage has been done to it.
The best judges of judicial review and costs are the judges. The judges invented judicial review. It was the judges who from 1976 developed the rules about judicial review. No Government would have done that. The judges did it because they realised that they should no longer be more executive than the Executive and that they needed to call Ministers and public bodies to account. It is one of the great glories of my life’s experience to have seen the flowering of judicial review. The present Minister of Justice thinks that judicial review is being abused by a lot of left-wing mischievous troublemakers who are running free and should somehow be curtailed. There is no basis for that allegation in my experience. If there were, you could be jolly sure that the judges themselves would criticise applicants who abused the process in that way. The Minister then goes on to suggest that this kind of change in legal aid will diminish mischievous and vexatious applications for judicial review.
All I can say about that is the best safeguards of the process are the judges and in this country, unlike some places, you have to get permission from the court before you can apply for judicial review. That is not an easy step. It often takes a great deal of skill to draft an application for judicial review. Lawyers have to be persuaded to do so, especially if they are not going to be reasonably paid for their services. Again and again judges will criticise applicants, as they will respondents, if they feel that they are misusing the process. I do not think that it is the business of a Minister to interfere with the discretion of judges in controlling the judicial review that they have developed.
I do not know any case, and certainly the present Lord Chancellor has not pointed to a single case, in which judges have failed to do their job properly by curbing the misuse of judicial review. I do not know a single example. He cannot give any; the Joint Committee on Human Rights asked him about it, and he was not able to provide any. Therefore it is an assault on the rule of law in a fundamental sense. It is not only about access to justice or equality of arms—that is to say, ensuring that the citizen and the state are on equal terms when it comes to judicial review. It is also about a complete lack of confidence in the ability of the judiciary to do its job properly. As a loyal supporter of the coalition, I feel very depressed at having to say what I have just said, but I am afraid that I have to say it, and I hope that whoever wins the next election chooses a Lord Chancellor and Minister of Justice who understands, as our Attorney-General now understands, what the rule of law implies. For all of those reasons I thoroughly support everything that the noble Lord, Lord Pannick, has said.
I support the Motion. I am deeply impressed by the noble Lord, Lord Pannick, and the whole House will be indebted to him and the noble Lord, Lord Lester. Together they have adduced a withering criticism of the notions, buttressed by the noble Lord, Lord Lester. The Government are entirely mistaken in what they intend to do. They are determined to whittle away the availability of legal aid. What they intend in this regard provides another example of what they have in mind. It may not be as significant as other measures but none the less it is important in its own right. The intention is condemned, as has been said, by the Bar Council, the Law Society and by lawyers who practise in the field, without exception. Even the noble Lord who will reply to the debate must be concerned about what the Government intend.
Lawyers do not earn in this field—they earn insignificant sums. They do it because the law intends that they should, and they abide by that intention. Moreover, legal aid may be denied after the lawyer has taken on the case. In other words, the court can decide after the event. I wonder whether that is fair. Is it just? Should it be done? Judicial review, as has been said, is an important remedy. It enables the court to determine whether the Executive have exceeded their powers in law. That should not be disregarded. Of course, this measure should not be viewed in isolation. The Government have already vent their opposition to judicial review as we know it, having decided that time limits that were previously prescribed should be curtailed, thereby enabling the Executive to restrict access to the courts. Is that right? Should it be tolerated for one moment?
In none of the recent situations have the Government given consideration to the impact of the changes that they seek to implement. Indeed, one would have thought that, having proper regard to the significance of access to justice, they would at least pause before embarking on further destructive changes. According to the Secondary Legislation Scrutiny Committee, to which reference has already been made, the Government’s intent is to procure savings that they estimate as some £1.3 million from the legal aid budget. The committee believes that, in fact, these costs will simply transfer costs to another area. Indeed, that is already happening. Clearly, what should be considered is the entirety of the Government’s expenditure. There should be a proper, measurable analysis of either the savings to be incurred or the benefits intended as far as the public is concerned. Neither has happened, and the lacuna is absolutely woeful.
The Government argue that their changes will result in 69% of legal aid being removed. Is that not extremely worrying? Are the Government not concerned about this? Is the Minister, who is himself a lawyer, also unconcerned? Why should the availability of legal aid be decided on a discretion which is exercised after the event? If in fact only a few cases each year—the estimate is some 751 cases—would result in legal aid being removed, why bother? Why should lawyers representing extremely vulnerable people be victimised? Why should they have to wait, as the Government propose, until later? Where else in law is anything like this proposed? In my view this represents a backward step, and the Government should be thoroughly ashamed of introducing it.
My Lords, I very much support the excellent speech made by the noble Lord, Lord Pannick. I hasten to say that I do not have any expertise in judicial review or in the work of the administrative court, save that I sat on the Court of Appeal, but the legal aid amendments raise constitutional issues of some importance.
I wish to say something about the position of the Lord Chancellor, following on from what was said by the noble Lord, Lord Lester. The Lord Chancellor is head of the Ministry of Justice and, more importantly, has for centuries been the conscience of the monarch and continues to be so. I wonder whether this Lord Chancellor has ever heard of that. Successive Lord Chancellors have had to juggle two positions, as a member of the Cabinet of the Prime Minister of the day and as head of the administration of justice. These two positions inevitably create a conflict of interest, which successive Lord Chancellors have generally managed well.
We now have for the first time a Lord Chancellor who is not a lawyer, who appears not to understand the importance of the judicial and legal systems, and who is either unaware or chooses to be unaware that the administration of justice is one of the pillars of the constitution. He appears not to recognise his special responsibility as Lord Chancellor. He has not listened to the judiciary, particularly the senior judiciary, or to the legal profession, and he has not given sufficient consideration to the implications of these regulations. I have had a great admiration for successive Lord Chancellors—and I suppose I must declare an interest as the sister of Lord Havers—and it saddens me to have to say this. Rather like the noble Lord, Lord Lester, I now regret the clause in the Constitutional Reform Act 2005 that permitted a non-lawyer to become Lord Chancellor.
The administrative court has an increasingly important role in society. It is a crucial part of the checks and balances between the Government of the day and members of the public who have not had a fair deal from a government department or local government. The court holds the Government or local government to account for misuse of powers, and ensures access to justice, accountability and good administration. The effect of these regulations is to reduce dramatically the opportunity of a member of the public to challenge a decision of government, even when that decision is patently unfair. I am talking not about pressure groups, but about individuals. If no legal aid is paid until permission is given then most of the work will have already been done, and in many cases the problem will have been sorted by the lawyers acting for the applicant.
In some of the lobbying information that I have received I was told of two cases where a lawyer sorted it long before it had to go to the judge, by giving the particular government department relevant information that the government officials had failed to look at or had not received from people who are unable properly to put their own cases forward. The absence of legal aid until the moment of the grant of permission will exclude all the cases settled and the management of many problems before the case comes to the judge. It will be a lottery, where many lawyers will not accept to do the work with the hope but not the expectation of payment, especially when the outcome may not require taking the case to the permission stage. The making of the application may itself be sufficient. This is manifestly unfair to the ordinary member of the public. In the year before we celebrate Magna Carta, we might just remember Clause 40:
“To none will we sell, to none will we deny, to none will we delay right or justice”.
That is a hollow phrase today, as many will be denied the right to have an injustice corrected by the courts.
It is very convenient for the Government to reduce the opportunity to challenge decisions made by their departments, which in itself will create a greater and greater inequality for members of the public. It makes many government decisions immune to scrutiny. That cannot be right. I recognise, of course, the efforts of this Government to cut expenditure and I applaud them for the many ways in which they have done so. But this attack on access to the administrative court is a step far too far. There must be some other way to deal with inappropriate applications. The suggestion of the noble Lord, Lord Pannick, that it should be left to the judiciary seems to be a sensible compromise. I hope that the Government will think again.
I support the Motion of Regret brought by the noble Lord, Lord Pannick. In my view, the Government have brought a large blunt instrument down on a subtle and fragile part of legal tissue.
I received a briefing this afternoon from a government source in this part of the coalition who told me that it was estimated there would be a saving of between £1 million and £3 million through the provisions that we are debating. That is just about the least robust financial assessment we have ever heard in this House. If the Opposition had put it forward, I can imagine the Government’s excoriation of it.
In saying what I say, I hope that I will be forgiven for not dwelling on the interesting subject of the epidemiology of the role of Lord Chancellor. I intend to concentrate on more practical things concerning legal aid. I do so from the position of someone who still sits for a few days a year as a part-time judge in the Administrative Court dealing with exactly these cases. I thought it might inform the debate if I told your Lordships something about that role.
On a typical non-court sitting day—that is, a sitting day but in chambers—the Administrative Court judge receives a trolley containing about 12 judicial review cases. Some but by no means all—now, at least—are asylum and immigration cases. Others are on a much broader range of issues across the field of judicial review of administrative action by central and local government, the Parole Board and other public bodies. If we take those dozen cases, some—on a bad day, a majority—are wholly without merit. That phrase was adverted to by the noble Lord, Lord Pannick. I agree with the Government that legal aid should not be available or recoverable for cases that are wholly without merit. The Bar Council has taken that realistic view, too.
Some claims are most certainly brought with very little thought, no understanding of the law and just as a delaying tactic. However, some of those dozen cases, on every single sitting day, have merit. The trick for the judge is spotting them. The question here is whether the filter should be the Government, either by statutory interdiction or via the Legal Aid Agency, or the judge. I support the view of the noble Lord, Lord Pannick, that the “wholly without merit” test, applied by the judge, is by far the fairest way of dealing with these cases. It is also transparently fair. It is fair in the minds of the public. It is free of the accusation that government or politicians have taken hold of judicial review for illegitimate, political purposes.
My Lords, I support the Motion of Regret tabled by the noble Lord, Lord Pannick. I congratulate him on securing this debate on a subject of such fundamental importance. I will leave the legal arguments to the noble Lords who understand them. I want to focus on the impact of these regulations on the more vulnerable in our society.
The Lord Chancellor acknowledges that judicial review is an important tool, yet he has railed against its use by campaigners, declaring, in an article in the Daily Mail last September:
“While charities inundate Westminster with campaign material, they also target the legal system as a way of trying to get their policies accepted. One essential part of the campaigner’s armoury is the judicial review, through which it is possible for them to challenge decisions of government and public bodies in the courts”.
Only three months ago the slight was repeated in the Government’s response to their proposals for further reform of judicial review, which said that,
“too often cases are pursued as a campaigning tool”.
Let me declare an interest: I have been a campaigner all my life and I am fiercely proud of it. I believe that my efforts have enabled disabled people to gain their rights to dignity and equality, which for so long had been denied them. I think all of your Lordships would celebrate this. Where would we be without campaigns to right injustices? To take only one example, where would we be without the crusading spirit of the noble Baroness, Lady Lawrence?
What lies behind many of the highest-profile campaigns? It is injustice. No matter how many times the Lord Chancellor repeats himself, judicial review is not about campaigning; it is about people standing up to public bodies when they get it just plain wrong. That is exactly why we need judicial review and why legal aid is so vital to its effectiveness. It is about every citizen’s right, not just those with deep pockets, to challenge the state if it behaves unlawfully.
Those who may be most affected—the disadvantaged in our society—cannot do that alone. They rely on lawyers to represent them. These regulations will make it all but impossible for lawyers to take on their cases. That is a denial of justice. It undermines the rule of law. These regulations have been severely criticised by the Secondary Legislation Scrutiny Committee and the Joint Committee on Human Rights, not only for what the regulations do but for the way they have been introduced. To deny Parliament the opportunity for full debate on an issue of such importance is surely an abuse of our democratic principles.
If there is evidence of judicial review abuses—which the JCHR did not accept—the Government should address those specifically. It is simply wrong to punish all those who use it legitimately in an attempt to prevent the few who might not. As noble Lords will know, my lifelong passion has been championing the cause of independent living. In just the past few months, we have had two landmark judgments. Both came about through judicial review.
In December 2013, the Court of Appeal decided that the Minister for Disabled People had not properly considered the impact that closure of the Independent Living Fund would have on severely disabled people. In March, the Supreme Court ruled that three vulnerable individuals had been unlawfully deprived of their liberty under the Mental Capacity Act.
We cannot be confident that such cases will continue to come before the courts if these regulations are in place. For this reason alone, I wholeheartedly support the Motion.
My Lords, it is always a privilege to follow the noble Baroness, Lady Campbell. She is an outstanding example to us all and it is a very humbling experience to follow her.
I speak, as she did, as a non-lawyer. I think it is good that non-lawyers should take part in a debate such as this. I was very glad that the noble and learned Baroness, Lady Butler-Sloss, referred to Magna Carta. I spent much of this afternoon discussing with people involved in it the preparation for our celebration of Magna Carta next year. I hope that next year we will underline in every home and every school in the land the fundamental importance of the rule of law. I would like to give every secondary school pupil in this country a copy of Lord Bingham’s splendid book on the rule of law.
It is all very well to say these things and to pay lip service to them. What we have to do is to pay more than lip service because what is being proposed by the Government is inimical to the rule of law as I understand it. Unlike the noble Lord, Lord Lester of Herne Hill, and the noble and learned Baroness, Lady Butler-Sloss, I was not happy about the change in the role of the Lord Chancellor, and I said so at the time. I feel mildly vindicated. I do not, in any sense, want to indulge in any sort of personal attack on any individual, but rather to talk briefly about the principle of the thing. I understand how government Ministers and those who run public bodies and local authorities can get very exasperated and impatient because of inconvenient challenges to their decisions. We are all human, and we all feel exasperated on occasion. But exasperation is not a reason for doing something that is not necessarily contrary to the rule of law but makes it more difficult for people to enjoy the benefits of the rule of law.
My Lords, even more than usual, thanks are owed to the noble Lord, Lord Pannick, for tabling this regret Motion, because these regulations are laid, as we have heard, under Section 2 of LASPO, which requires only a negative statutory instrument. This allows for the implementation of the regulation before Parliament has any opportunity to debate it. Indeed, Parliament would have had no such opportunity if not for the noble Lord himself. All those with an interest in the rule of law and access to justice—and that should be all of us—once again owe a debt of gratitude to the noble Lord.
Other experts argue with some force that the appropriate way for Her Majesty’s Government legitimately to bring forward such a major reform—with the likely consequence that in practice many poor citizens will not be able to exercise every citizen’s right to question executive power—is by primary legislation. If this, however, is asking too much, these experts argue that the regulations should have been laid under Section 9 of LASPO, which obliges the Government to get parliamentary approval before the regulation comes into place. Thankfully we are having a debate, and I make a few points in support of the Motion of the noble Lord, Lord Pannick.
I perhaps ought to declare an interest. I am probably the only speaker to take part in this debate who has been on the wrong side of a judicial review. The court found against the decision I had taken. However, that encourages me even more to make the points I intend to make.
In his initial attack on judicial review, the Lord Chancellor implied in rather a general, throwaway manner that judicial review was somehow becoming the tool of left-wing pressure groups egged on by left-wing lawyers. This sort of talk may of course satisfy the Daily Telegraph on a bad day, or the Daily Mail on any day, but it does not accord with reality. Judicial review is supposed to be open to all citizens who want to challenge the decisions of the executive: it should be for all of us. Examples of citizens, rich and poor alike, taking this course are legion. For me, a current example is close to home, and I mention it briefly. The self-described descendants of King Richard III, who obtained a judicial review of the Lord Chancellor’s decision, cannot, I suggest, be described as left-wing activists whose purpose is to destroy civilisation as we know it.
Criticism can and must be made of the Lord Chancellor himself. He often gives the impression, I am afraid, that he does not always appreciate important principles that lie at the heart of our legal system, or that he does not have much understanding of how it works in practice. Both are important: the principles, and how they work in practice. It is unfair—on balance—to say that it is because he is not a lawyer. There are many non-lawyers who have a deep understanding of how precious and important our legal system is. However, I make the point that all four of the Lord Chancellor’s current crop of junior Ministers are distinguished lawyers. One in particular is distinguished—I will not embarrass him by naming him tonight but I think he knows who he is. I ask this question of that Minister: is it not time that he and his lawyer colleagues, who, just as much as the Lord Chancellor, must have the interests of justice as their prime obligation, girded up their loins, if I may use that expression, and together pointed out to their boss that many of the changes being made in his name seem to have scant concern for the concept of the rule of law, or access to justice, or how these important principles are put into practice in a system that I hope is still—but only just—the envy of the world?
The regulations we are debating are, I argue, a good example. Everyone who has looked at the regulations comes to the irresistible conclusion that for the LAA not to be allowed to pay any legal aid in a case where permission is refused and for the Lord Chancellor to have an unclear and uncertain discretion if a case never reaches the permission stage will have a chilling effect. It will mean that lawyers will not be able to take judicial review cases where the claimant cannot afford to pay. The result is that a system of law which is open to all will inevitably have become closed to many, and in particular to those who most need the protection of judicial review against the power of the Executive.
As the Bar Council put it in paragraph 9 of its very well argued briefing note:
“A fundamental concern is that a particular group only (namely, legally aided claimants) would be subject to these provisions. Public authorities would face no particular adverse consequences when they resisted applications for permission for no good reason. The position of privately funded claimants would remain unchanged. Treating legally aided claimants differently would be unfair. It does not happen in relation to other areas of law. It would create an unprecedented imbalance between the parties to litigation and will lead to inequality of arms”.
That is a powerful statement. When the Minister comes to reply, will he say whether he agrees with it?
Of course, the point has been made that there are already filters in place: a merits test before legal aid can be granted and, in every case, there is a permission stage. As the same note from the Bar Council says in paragraph 11,
“the existence of the filter amply serves its intended purpose. It is wrong in principle to impose additional, specific disincentives to accessing the permission stage itself. That does not ‘rebalance’ judicial review; rather, it risks fatally undermining it”.
If one looks back to the passage of the LASPO Act through Parliament, the Government promised two safeguards. One was that exceptional cases would be a safety net for the area of social welfare law that was being taken out of scope. In its first year of operation, the exceptional cases point has turned out to be a miserable failure. The second safeguard—the noble Lord, Lord Pannick, spoke of this—was of course to be the continuation of legal aid for judicial review. As the Government argued in their own original Proposals for the Reform of Legal Aid in England and Wales in November 2010, judicial review represents,
“a crucial way of ensuring that state power is exercised responsibly”.
Throughout the lengthy debates in this House and in the other place, Ministers would use the existence of legal aid judicial review as a reason why it was safe to remove legal aid from social welfare law. Yet barely one year after Part 1 of that Act has come into force, the Government are introducing a regulation that is bound to have the effect of making it very unlikely that a poor or disabled person, or a citizen who needs legal aid, will be able to get justice by way of judicial review. The risk of not getting permission, and thus not getting any costs, is so great that providers simply cannot or will not be able to do it.
To my mind, this represents a particularly low point for the Government. They have got controversial legislation through Parliament on a false basis and further demeaned our legal system. Where will it end?
My Lords, I cannot compete with the expertise of other speakers before me, but I declare a couple of interests. First, I am a regulator of the profession—but not its representative. Secondly, despite what the noble Lord, Lord Bach, said, I have been involved in several judicial reviews and have won three and lost one, albeit ably represented by the noble Lord, Lord Pannick, with the noble Lord, Lord Lester, on the other side. I am in the middle of yet another. Bitter experience though it was, this does not deter me from supporting the noble Lord, Lord Pannick, in asking the Government to think again.
Why do we spend so much time in this House attempting to perfect the laws that come to us from the other place and our own? The ultimate way of enforcing them and making sure that they are good law is by judicial review—or at least the threat of judicial review. Many public bodies which make important decisions do so acting in the shadow of judicial review, expecting it to come. Knowing this makes them take much more care over how they apply our law. This House and the other House will be the losers if judicial review is restricted.
I tweeted this morning that we spent £9 billion on the Iraq war, spent £11 billion on the Olympics and may well spend £50 billion or more on HS2. Our legal system stands at risk for the sake of £200 million, which, in the global way of looking at things, is very little. I know that the Law Society and the Bar Council have put forward to the Ministry other ways of saving that money.
How will this particular reign of the current Lord Chancellor be remembered in the history books? It will be remembered as one of impending chaos. We now have a situation where, because of the attempts to save money, important fraud cases collapse because no barrister will work for the sum offered and the family courts are clogged up with emotional litigants in person thereby causing judges to have to run cases in a way that they really should not have to. Speaking as a regulator, I can say that altruistic young people, very often from black and ethnic minority backgrounds, are being deterred from taking up law as a profession because criminal law and family law will no longer offer them even the most modest of incomes with which to start out, bearing in mind that they have debts from university. I could not in all honesty encourage them to take up the profession right now. That means that 10 or 20 years down the line, there will be yet more complaints about the lack of social mobility and diversity in the profession. There will continue to be calls for more ethnic minority and female judges, and they will have been cut off right now because of these attempts—well meaning, I suppose—to save £200 million.
Why is this coming about? If one goes back a bit, the blame has to lie with the former Prime Minister Tony Blair, who made a constitutional change for which we are now paying. When I was a law student, I learned that the British constitution was never roughly pushed around; it simply inched along, changing a bit here and there, in response to circumstances. The position, however, of the Lord Chancellor was rather brutally changed a few years ago. True, the old-style Lord Chancellor offended against the separation of powers. He was a Speaker, he was a member of the Cabinet and he was a judge. But look where we are now. Our system of justice lacks a champion. The rule of law needs someone to look after it who is not looking for political preferment, looking to the next job or looking to save money and thereby garner acclaim. The system of justice needs an old-style champion complete with curly wig, stockings and all the rest of it, because that symbolised someone who was above it all, who had reached the top of the tree and whose only concern was access to justice and the smooth running of the system.
I am afraid that the current Ministry of Justice, so-called, might one day be called by the history books the “Ministry of Injustice”. What is going on is not right and I think that everyone in this Chamber, no matter what side they are sitting on, knows that very well. I support the noble Lord, Lord Pannick, and I congratulate him. I call upon the Ministry to think again.
My Lords, we in this House owe a great deal to the noble Lord, Lord Pannick, for his untiring attempts to preserve access to justice for vulnerable and powerless people—the legally aided claimants. I rise in support. I wanted to ensure that we had on record the concerns of some of the excellent people who work hard to get access to justice for powerless people, and I felt very privileged to hear the contribution from the noble Baroness, Lady Campbell of Surbiton, who is one of the stars in that firmament. Liberty does a great deal of this sort of work—I declare an interest as a trustee of the Civil Liberties Trust—but Liberty says that from its experience,
“the prospect of irrecoverable costs will place an unsustainable burden on claimant lawyers, making it simply too risky to pursue legal aid claims”.
I also want to mention young legal aid lawyers. Personally, and I am sure that other noble Lords will agree with me, I think we should be grateful that there is an organisation called Young Legal Aid Lawyers, and one wonders what they live on. The organisation has written to me about its work on legal aid immigration cases and the fear that the firms that these lawyers work for, in spite of their commitment to social justice, just cannot afford the risk of taking on some of these cases, even when they feel deeply that an injustice has taken place.
The Howard League for Penal Reform is extremely concerned about the effect of this measure on vulnerable people, including serving prisoners and those leaving prison. The Howard League referred me to the 2009 case of G, regarding a young person in trouble who was sleeping rough in a car. Through the Howard League he got a solicitor who brought judicial review proceedings about the responsibility to house him. Eventually the case reached the House of Lords where the noble and learned Baroness, Lady Hale, supported by the noble and learned Lord, Lord Hope, came out with a judgment that has resulted in a profound change in the way in which homeless young people are dealt with by local authorities. That one case has had a substantial effect on the lives of many children and saved a great deal of money.
Other judicial review cases have profoundly affected and improved the treatment of vulnerable prisoners—for example, a successful judicial review challenge with regard to the failure to transfer a prisoner with mental health problems from prison to a secure hospital for treatment; a successful judicial review challenge on behalf of a severely disabled prisoner in relation to the prison authorities’ failure to provide him with a motorised wheelchair and allocate him to an adapted disabled cell; a successful judicial review claim on behalf of a female prisoner with regard to the lack of disabled facilities in women’s open prisons; a successful judicial review on behalf of a prisoner with learning disabilities relating to the prison authorities’ failure to adapt offending behaviour programmes; and a successful judicial review challenge on behalf of a prisoner to stop prison authorities from reading his legal mail.
Those are all important matters that relate to the just treatment of vulnerable individuals and those who face discrimination. They are decisions that change the way in which things are done so that prisoners with learning disabilities can do offending behaviour programmes and maybe get parole, prisoners with serious mental health problems go to hospital and get treated and disabled prisoners are treated with respect for their human dignity. Does the Minister not regret just slightly that these sorts of developments will become more rare? Will he explain what he actually has against people such as those who have been described during this debate getting the wrongs that are done to them righted?
My Lords, we should be grateful to the members of the Secondary Legislation Scrutiny Committee and the Joint Committee on Human Rights for their two excellent reports; and, of course, to the noble Lord, Lord Pannick, for securing this debate. Parliament ought to be vigilant for the liberties of the people. The committees and the noble Lord have indeed been so.
There are constitutional principles at stake in these regulations of bedrock importance: the principle that effective remedy should be available against arbitrary government and the principle that there should be equality under the law. Indeed, it is the rule of law itself which is in question. The law should be for the convenience of the people and not their governors. It is essential, therefore, that remedy should be available that is practical for an aggrieved citizen to seek, and that is available regardless of his personal means, against a public body that conducts itself in a manner that is unlawful, procedurally incorrect, incompetent, oppressive or unreasonable. If judicial review is not available to enable a challenge to wrongful decisions by the state or its agencies, we move away from a liberal constitution and towards executive absolutism.
Noble and learned Lords have explained in exactly what detailed respects these regulations are so offensive and how they would do their damage in practice. I pay tribute to them as I do to the range of admirable organisations and individuals who have made representations to us. It is extraordinary that we should be asked to rely on the funding of remedy against bad government at the discretion of the same Government who are themselves being impugned.
If it is unsure that legal aid will be available for the preparation of meritorious cases, then the freedom to seek judicial review is no more than the proverbial freedom of the poor man to dine at the Ritz. If a significant number of applications will not, under these regulations, be able to proceed, we lose important opportunities for the clarification of the law and for the improvement of public administration that the pressure of judicial review brings about.
Are these regulations really designed to save money? The Explanatory Memorandum asks us to accept that they are, and says that the primary objective of the Government in bringing in these regulations is to bear down on the overall cost of legal aid. I do not believe it. The Ministry of Justice’s estimate of how much might be saved is in the range, as the noble Lord, Lord Carlile of Berriew, mentioned, of between £1 million and £3 million. That is an extraordinarily vague assessment. We are also told by the department that somewhere between 20% and 69% of applications, if one goes by recent experience, would no longer receive legal aid. Again, the vagueness of that range—between 20% and 69% of cases—is horrifying. It would seem that the department has not done its homework and, certainly, that it has no clue as to how much it might be going to save. That is before we consider what would happen to net costs. There can be little doubt that the costs of the changes brought in by these regulations would be shunted elsewhere and would certainly not, in the end, be avoided.
Nor has the department been able to make clear how the payments system will work. Reasonably enough, if solicitors and advocates cannot foresee with any confidence that they will be paid, they will not be willing to take on cases. This is a shoddy and improper way in which to legislate. I also believe that the generality of citizens of this country, if apprised of the significance of the issues at stake, will be more than happy to pay whatever taxes it takes to pay for a proper system of judicial review.
My Lords, once again we are debating matters concerning legal aid and, once again, almost universally around your Lordships’ House, there is criticism of the Government—tellingly, from experienced, distinguished lawyers and, perhaps even more tellingly, from non-lawyers. Those of us who have heard from the noble Baroness, Lady Campbell, with her particularly powerful and moving speech, and the noble Lord, Lord Cormack, who has consistently addressed the sort of concerns that he voiced tonight, will understand the depth of feeling that the Government’s proposals have aroused. It is striking also that, once again, not a single voice has been heard in support of the Government. The noble Lord the Minister has been given his brief and he will undoubtedly, in his usual charming and skilful way, discharge it capably, but he will do entirely without legal or political aid. That is some commentary on how these matters are viewed.
This set of regulations is but one of a series intended to restrict access to judicial review, especially for those with limited financial resources. The ostensible justification, as we have heard, is to save public money. However, as we have also heard, the actual savings are likely to be minimal—£1 million to £3 million—just as they were from the changes to prison law and in respect of compensation for miscarriages of justice. Last week it emerged that unpaid fines have reached £250 million—more than enough to fund legal aid in these contentious areas and others for several years. It is not being cynical to suggest that we are seeing the gradual demolition of judicial review on the instalment plan. In the next Session we will have the dubious pleasure of debating yet another of the Lord Chancellor’s lethal legal cocktails: the Criminal Justice and Courts Bill, which, among other things, seeks radically to transform the approach to judicial review in the highly controversial area of planning. A Government who purport to want to reduce the role of the state seem uncommonly keen to make it more difficult to challenge the state’s decisions, or those of other public agencies.
The late and much lamented Lord Bingham summarised the role of the judiciary and of judicial review in chapter 6 of his seminal work The Rule of Law, to which the noble Lord, Lord Cormack, referred. In it, he said:
“But in properly exercising judicial power to hold ministers, officials and public bodies to account, the judges usurp no authority. They exercise a constitutional power which the rule of law requires that they should exercise”.
He added tellingly:
“This does not of course endear them to those whose decisions are successfully challenged. Least of all does it endear them when the decision is a high-profile decision of … the government of the day”.
It is in that context that it falls to us to consider these regulations. They have, as we have heard, attracted severe criticism from the Secondary Legislation Scrutiny Committee in its 37th report published on 27 March. I note in parenthesis that the regulations were laid on 14 March and came into effect on 22 April, so that Parliament had virtually no time to consider them or the committee’s report before they became law. This is a matter which the Government and the House should perhaps look into, and the committee itself drew attention to that point in paragraph 15 of its report.
However, the position in relation to the Joint Committee on Human Rights is, if anything, even worse. Its report was published only a week ago and is equally critical in terms of both substance and process, going so far as to recommend that the regulations be withdrawn and be made the subject of primary legislation by tabling amendments to the Criminal Justice and Courts Bill, as advocated tonight by the noble Lords, Lord Pannick and Lord Cormack. Will the Government accept this proposal, and if not, why not? There is no shortage of available parliamentary time, as our extended recesses demonstrate.
The Secondary Legislation Scrutiny Committee’s report raises a series of concerns, many of them identified as long ago as September 2013 in a special edition of the journal Judicial Review, of which the noble and learned Lord, Lord Woolf, who is not in his place tonight, is a consulting editor, drawing on responses to the Government’s consultation on—in a wonderfully Orwellian phrase—“Transforming Legal Aid”.
What answers do the Government have to the questions posed by the committee on the impact of the changes on the payment system, the number of cases which would engender discretionary payments, and the issue of cost-shifting from the legal aid budget to other areas? Has the Ministry of Justice met the demand of the committee to clarify,
“exactly what work will, and will not, be paid for and how the Legal Aid Agency will exercise its discretion over payment”?
Your Lordships will bear in mind the vestigial number of cases in which the Legal Aid Agency’s discretion has been exercised in favour of claimants under the exceptional funding process. In that context, the committee referred to the circularity of the process by which the agency would review a decision on receiving payment, with the consequential result, in this Grayling in Wonderland world, of its own decision being subject potentially to judicial review.
The Government’s intention not to exclude legal aid for the preparatory work for an application may be welcome but, as the committee points out, that intention appears to conflict with the Civil Procedure Rules, which make payment for such work discretionary. How does the Minister respond to that point raised by the committee?
This is, of course, one aspect of the so-called “chilling effect”, to which many consultees and Members of your Lordships House tonight have referred; that is, the reluctance of practitioners to undertake work within the tightly limited timescale of only three months—soon to be further reduced, by the way, for planning matters—to lodge an application for which they may not be paid. Again, the committee draws attention to this issue at paragraph 20. What assurances, and examples, can the Minister give about this key issue, and will he confirm, in the words of paragraph 21 of the report, that “unambiguous guidance” on how the Legal Aid Agency intends to exercise its discretion will be published after consultation, or, better yet, will he set out a clear definition in these or further regulations?
This, after all, is the nub of the issue. As the Bingham Centre for the Rule of Law pointed out, it is privately funded cases that are more readily pursued and less likely to succeed, with permission granted to 48% of legally aided applicants against 9% of others. Nor is there anything to suggest that legally aided judicial review cases,
“are pursued in a reckless way that results in a relatively high number of ‘weak’ cases”.
That statement comes from the Bingham centre. More legally aided cases do not proceed to the stage of seeking permission, such that it is clear that legal aid lawyers are acting responsibly.
The centre points out that no reference is made to the behaviour of defendants in relation to applications for permission. Will the Minister undertake to review this aspect, which might encourage a more reasonable response and/or generate some benefits in terms of cost? Similarly, will the Minister consider the suggestion of Michael Fordham QC, supported tonight by the noble Lords, Lord Pannick and Lord Carlile, to revisit the ministry’s own proposal for a mechanism under which the judge initially considering an application for permission could issue a “totally without merit” certificate?
My Lords, I am grateful for the opportunity to accept the invitation to gird my loins and to respond to the noble Lord, Lord Pannick, and others—lawyers and non-lawyers alike—who have spoken in this debate this evening. As the noble Lord, Lord Pannick, said, many of us are veterans of the LASPO Bill, and I count myself as one. I declare an interest as until recently I was a barrister who practised in, among other areas, the field of judicial review, acting for both applicants and respondents, so I have some experience of this procedure. I should explain to the House the Government’s position on the regulations concerning the remuneration for legally aided judicial review permission applications that were laid before the House on 14 March and came into force on 22 April.
The debate has ranged far and wide this evening. We have had references to the separation of powers, a reminder of Montesquieu, a magisterial analysis of the developing role of the Secretary of State and the Lord Chancellor and a call to the reversion of the status quo ante, whereby the Lord Chancellor had a rather different and separate role. We have had a critique by the noble Lord, Lord Howarth, of the whipping system and of the machinery of government as a whole; an implied undertaking to repeal the Fixed-term Parliaments Act; a criticism of reforms of the national health system; and an attack on the Government as a whole. We have also had criticisms of the exceptional funding arrangements in the LASPO Bill and of the social welfare law provisions. To respond to all these issues would take several hours. I hope that noble Lords will understand if I do not do so but concentrate on the rather prosaic matter of these particular regulations.
During the course of the speeches of great quality which we have had this evening, a dispassionate observer would have thought that the Government were abolishing judicial review. Such a course would of course be of fundamental importance and would indeed fall foul of the many criticisms that have been ranged against it this evening. I entirely accept that judicial review is a critical check on unlawful action by public bodies and that it is wholly right that individuals should be able to access this mechanism. The many cases cited by the noble Baroness, Lady Stern, are examples of successful judicial reviews. The noble Baroness, Lady Campbell, quite rightly drew attention to the many actions that have been assisted by judicial review to right wrongs. Nothing about these modest regulations will do anything to erode that.
Civil legal aid for most judicial review cases will remain within the scope of the legal aid system. These regulations relate solely to the remuneration of legal aid providers and will ensure that limited legal aid funds are not used to remunerate weaker cases. The detail—prosaic though it is—does matter. It is a long-standing feature of our legal aid system that there should be limits on access to funding based on the strength of the case. To qualify for civil legal aid, cases must satisfy a merits—or prospects of success—test. Broadly speaking, a judicial review case must have a 50% or greater prospect of success at the final substantive hearing. However—there has not been a great deal of reference to this in the debate—noble Lords will be well aware that before any substantive judicial review hearing, the court must first give permission to proceed. Permission will be given if the court considers that a case is arguable and therefore merits full investigation. The permission stage therefore acts to filter out weaker cases at an early stage in the process.
Providers are well placed to assess whether or not the court is likely to grant permission before they issue an application. They will not be required to make a random guess before taking the risk to issue proceedings. That is because their assessment is undertaken following the pre-action stage of the process during which time providers gather the relevant information about the strength of the case. Noble Lords may be familiar with the protocol that applies in these cases. It is that information that enables them to make an assessment as to whether to issue proceedings. Under the policy, work to investigate the strength of the case and engage in pre-action correspondence would not be at risk. A case that has received legal aid and so has been assessed as having a 50% or greater prospect of success at the final hearing should be more than capable of satisfying the lower arguability threshold.
However, Legal Aid Agency data indicate that a significant number of legally aided cases—751 in 2012-13—apply for permission and fail, with potentially substantial sums of public money being expended. The commentary on civil procedure contained in the White Book, with which all lawyers will be wholly familiar, states as follows in rule 54.4.2, which deals with the permission application:
“The purpose of the requirement for permission is to eliminate, at an early stage, claims which are hopeless, frivolous or vexatious and to ensure that a claim only proceeds to a substantive hearing if the Court is satisfied that there is a case fit for further consideration”.
That is a synthesis of the case law. It was quoted in the consultation, to which there has been some reference. The Government do not consider it fair or justified that limited taxpayers’ money should be used to fund such cases. The legal aid merits criteria provide an important control, but it is clear that they are insufficient by themselves to address the specific issue that we have identified in judicial review cases. These regulations will therefore introduce a further control by placing remuneration for the work on a judicial review at risk from the point at which proceedings are issued—that is, when an application for permission for judicial review is made to the courts. Providers will be paid for this work if the court gives permission.
Permission may be applied for but a case may of course also conclude prior to the court’s decision, a point made by a number of speakers. In those circumstances providers should seek to recover costs, either through agreement with the other party or by a costs order made by the court which orders the public body to pay the legal costs. Where this cannot be achieved, the regulations enable the provider to apply to the Legal Aid Agency for a discretionary payment. These regulations do not—as I think the Motion of the noble Lord, Lord Pannick, seems to suggest—make legal aid in judicial review cases solely dependent on the court granting permission to proceed.
This policy was the subject of extensive public consultation. The Government have listened carefully, and gone to lengths to modify the proposal to ensure that payment will continue to be made in meritorious cases. In response to concerns raised in the first consultation that strong cases will often conclude pre-permission, without costs being recoverable—a perfectly fair point made by a number of noble Lords—we moved to introduce a discretionary payment mechanism. In response to concerns that this discretion would be too inflexible—for example, that it could penalise providers who acted reasonably throughout but where new information subsequently came to light which altered the strength of the case—we modified the factors that the LAA would have regard to, and ensured that these would be non-exhaustive.
Remuneration will continue to be paid for the earlier stages of a case, where investigations are carried out into the prospects and strengths of a claim and pre-action correspondence is exchanged with the defendant. The regulations would not affect subsequent work in respect of the substantive hearing, once permission has been given. Nor would they place at risk any reasonable disbursements which arise in preparing the permission application, such as expert’s fees and court fees. Work relating to applications for interim relief will also not be at risk. Of course, providers can always discontinue the process, either following the pre-action stage where providers can decide not to issue proceedings on the basis of their assessment of the evidence, or after proceedings have been issued, where providers may seek to discontinue the case if they consider that the prospects of success have been materially altered.
The regulations only and specifically put at risk work on the permission application, in accordance with Part 54 of the Civil Procedure Rules 1998 or Part 4 of the Tribunal Procedure (Upper Tribunal) Rules 2008, where an application has been issued. By way of example, this would include work on drafting the grounds of claim, and preparing the claim form or application for permission and the bundle of documents. I have been somewhat surprised by arguments that providers would be unclear what work would and would not be at risk. These are matters with which any legal aid provider who carries out litigation will be very familiar, for example for the purpose of preparing a statement of costs.
I am sorry to interrupt, given the lateness of the hour, but what my noble friend is saying perplexes me. Would he please look at Regulation 5A(b)? This deals with the situation where neither a refusal nor a granting of permission takes place, and the Lord Chancellor is then given discretion where he considers it is reasonable in the circumstances to pay remuneration, taking into account (i), (ii) and (iii). I will not embarrass the Minister by reading those out, because everyone would laugh if I did. But looking at (i), (ii) and (iii), and putting himself back in the days when he was a barrister appearing for applicants, how on earth could he reasonably predict the outcome, so far as costs are concerned, with those criteria?
I will endeavour to answer my noble friend’s question when I come to deal with the discretion.
We do not expect that these regulations will result in providers leaving the market—one point that was made—or that there will be an insufficient number of providers remaining. We do of course expect some providers to take on fewer judicial review cases. Indeed, it is the purpose of the policy to provide a disincentive to providers taking on unmeritorious cases and thus to ensure that limited public funding is targeted at the cases that justify it. While I wholly agree with my noble friend Lord Cormack about the importance of the rule of law and the appropriate endorsement of Lord Bingham’s book, he seemed anxious to encourage any sort of case on the basis that some case might emerge from the morass of unmeritorious cases. We are keen to reduce the size of the trolley of the noble Lord, Lord Carlile, so that those who are contemplating bringing judicial review proceedings think long and hard before going on to make these applications.
The Government firmly reject the accusation that these regulations will undermine access to justice. There is nothing novel about the principle of expecting providers to work at risk and receive remuneration only where it is established that their case is meritorious. A similar system has existed for some time in immigration and asylum Upper Tribunal appeals, where remuneration for a permission application is not paid where the application for permission is refused. There has been little about interim relief, but I have made it clear to the House that these will not be caught by the restriction on legal aid that these regulations involve.
I now respond to the argument that further guidance should be issued on the Legal Aid Agency’s discretion. During the consultation process, the proposal was criticised for prescribing too rigid a list of criteria that the agency would consider. The Government responded by modifying the criteria and making it clear that these would be non-exhaustive factors that the Legal Aid Agency would take into account, in particular when considering all the circumstances of the case.
That is important, as it will enable the agency to take into account the full range of circumstances in which a judicial review case may conclude prior to a permission decision. No two cases will be identical and the agency will necessarily need to look at the facts of each individual case in addition to the factors set out in the regulation. This provides the agency with greater flexibility to ensure that work on meritorious cases continues to be paid, which I hope all noble Lords will support. However, the corollary of this approach is that it would simply be impractical for guidance to be issued that attempts to cover all possible circumstances. The consultation response sets out in further detail how the LAA will apply the factors that we have set out and we do not consider that additional guidance could add anything further to this.
As noble Lords will be aware, the House of Lords Secondary Legislation Scrutiny Committee issued a report criticising the regulations, which has been much referenced. We have responded to the report and a copy of the letter has been placed in the House Library. I hope that noble Lords have had an opportunity to see it. The Government will also respond to the report of the Joint Committee on Human Rights in due course. Many of the questions posed in that report were repeated by the noble Lord, Lord Beecham. We will respond in detail to that report and most of the questions that he posed will be answered. We will, of course, keep the operation of these regulations under review as part of the planned post-implementation review of the totality of changes brought in by the LASPO Act, due to take place in the next two to four years.
I acknowledge that the Government have made a number of significant changes to the civil legal aid system since we came to power. The underlying rationale for all these, including the regulations that we are debating tonight, has been to bear down on the cost of legal aid. That is necessary in the current financial climate, which was acknowledged, despite severe misgivings about these regulations, by the noble and learned Baroness, Lady Butler-Sloss. We need to ensure public confidence in the legal system by targeting limited legal aid resources at the people and cases where funding is most needed. These are the aims that I believe the public firmly support.
There has been a great deal of criticism of my right honourable friend the Lord Chancellor and his role. I do not think it is appropriate for me to go into the detail of the attacks that have been made on him. I am sure that noble Lords are sufficiently generously spirited to perhaps construe his referring to left-wing causes as a bit of hyperbole on his part. It matters not, of course, whether the applicant is left wing, right wing or has no political view at all. The question is whether the case is meritorious and whether it should be supported by what are sparse legal aid funds. It is important that the limited availability of legal aid should be targeted appropriately. What this regulation does is not to abolish judicial review, but to limit—in very specific circumstances—the recoverability of legal aid, once the information is available, and subject to the discretion which I have attempted to describe. We may have further arguments, I suspect, when the Bill referred to by the noble Lord, Lord Pannick—the Criminal Justice and Courts Bill—comes before your Lordships’ House. That Bill has various other provisions which do, to some extent, restrict the scope of judicial review, but certainly do not abolish it.
I will, of course, take back the comments made by noble Lords from all round the House to my right honourable friend the Secretary of State and Lord Chancellor, and will convey the anxiety expressed about this erosion, as it characterised, of a constitutional principle. I ask noble Lords to look at the reality of what these regulations propose and not to be too exercised by what has been, I think, somewhat exaggerated in terms of their effect in restricting judicial review. I respect the rule of law, as I hope noble Lords will accept. I accept the value of judicial review and I would not wish to be part of any Government who abolished judicial review. It remains an important constitutional provision begun, as my noble friend Lord Lester described, in the 1970s and developed since, but it is not an illegitimate aim to look at where resources can be properly targeted and to make appropriate adjustments to make sure that only cases which are really worth the public’s expenditure are reaching the court.
My noble friend has expressed his regrets, with his characteristic economy of words. I hope his regrets have been somewhat mollified by this response.
My Lords, before the Minister sits down, would he give some consideration to the unanimity of the view which has been expressed in this House—which I have audited—that this measure is a constitutional monstrosity? Would he consider, and represent to his departmental colleagues, the possibility that Parliament may come to grips with these issues and take the decision? This is one which, because of its constitutional extent, should be decided not by a Minister but by a Minister in Parliament.
I hope I have made it clear that I would take back the observations that were made during the course of the debate. I will, of course, add to that the comments made by my noble friend just now.
My Lords, the poor quality of these regulations has provoked a debate of the highest quality. I thank all noble Lords who have participated in identifying defects in these regulations. I also thank very sincerely the Minister, who has put the Government’s case without any support whatever from the Benches behind him. It is no reflection on the noble Lord’s very considerable powers of advocacy to say that the arguments he has advanced tonight in support of the Government’s position are, to use a phrase commended during the debate, wholly without merit.
The Minister emphasised that the Government are not abolishing judicial review. We must be thankful for small mercies. It is no defence to a charge of criminal damage for the defendant to say, “I have not committed a murder”. The Minister says—and who could disagree?—that hopeless cases should not be funded by judicial review. Of course they should not, but the Minister will appreciate that the thrust of this debate is that the test imposed by these regulations does not distinguish between hopeless and other cases, as would be the case if the judge were to have a power to determine for the purposes of legal aid whether the case is hopeless. I am pleased that the noble Lord has given a commitment to ask the Lord Chancellor to reflect on what has been said tonight. I hope that the Minister will be able privately to add his concerns to those expressed in the House.
I have one other point: your Lordships will have a proper opportunity in the next Session for detailed scrutiny of the Lord Chancellor’s attempts to neuter judicial review in the most regrettable proposals in the Criminal Justice and Courts Bill. I am confident that, as the noble Lord, Lord Cormack, said of these regulations in his powerful speech tonight, there will be in the next Session a coalition of Peers from all sides of the House who will express their concern about the Lord Chancellor’s proposals and, I hope and expect, in relation to that Bill will demonstrate their commitment to the rule of law in the Division Lobbies. Like so many of your Lordships and so many outside this House, I regret these regulations. I beg leave to withdraw the Motion.