House of Lords
Mutuals’ Redeemable and Deferred Shares Bill [HL]
(10 years ago)
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Lord Deighton
“(1) The Treasury may by regulations make provision to permit or facilitate the issue of deferred shares by a friendly society or mutual insurer.
(2) “Deferred shares” are instruments that—
(a) are issued by a friendly society or mutual insurer (“the issuer”) with the consent of the appropriate authority,(b) can be transferred but not withdrawn,(c) prohibit repayment of principal other than—(i) on the winding up or dissolution of the issuer where all other sums due from the issuer to creditors claiming in the winding up or dissolution are paid in full, or(ii) where the appropriate authority has consented to the repayment, and(d) have such characteristics as are specified in regulations made by the Treasury under this paragraph.(2AA) Regulations under subsection (1) may modify any of the following—
(a) the Friendly Societies Act 1992 (as amended from time to time);(b) the Companies Act 2006 (as amended from time to time);(c) any other primary legislation relating to friendly societies or mutual insurers (whenever passed);(d) any instrument made under the legislation mentioned in any of paragraphs (a) to (c) (whenever made).(2AB) Regulations under subsection (1)—
(a) may not make provision that would permit or facilitate the issue of deferred shares by a friendly society or mutual insurer where it is not authorised to do so by its memorandum, rules or constitution;(b) may make consequential, supplementary, incidental, transitional or saving provision;(c) may make different provision for different purposes.(2CC) A deferred share issued by virtue of regulations made under subsection (1) is not a share within the meaning of the Companies Acts.”
The Commercial Secretary to the Treasury (Lord Deighton) (Con)
My Lords, I congratulate my noble friend Lord Naseby on securing a prompt date for the Committee stage of this important Bill. The Government are supportive of the key objective of the Bill, which is to provide mutual organisations with a means to raise external capital in a way that preserves the mutual status of those firms. The mutual sector has made the case that current capital constraints are preventing friendly societies and mutual insurers acquiring other businesses that would strengthen the overall offer to members and policyholders, and may also be restricting these organisations from developing new or innovative products, especially if these products require material amounts of regulatory capital to be held. Growth in these areas would potentially be to the benefit of both with-profits policyholders and other members of the mutual.
The Bill therefore addresses access to capital for two mutual sectors: friendly societies and mutual insurers and industrial and provident societies, now known as co-operative and community benefit societies. The Bill provides that the Treasury may make regulations, subject to the affirmative procedure, to the friendly societies and mutual insurers to issue deferred shares and to commit co-operative and community benefit societies to issue redeemable shares. At Second Reading my noble friend Lord Newby noted that the deferred share capital instrument for mutual insurers and friendly societies provides a good way forward, and he committed the Government’s support to this instrument. My noble friend also outlined at Second Reading that the Government would not extend their support to the proposed redeemable share instrument for co-operative and community benefit societies, as these societies already have a means of issuing redeemable shares. I am pleased that my noble friend Lord Naseby has accepted the Government’s support for this more limited Bill.
Government Amendments 1 to 16 achieve three objectives. First, they give effect to the Government’s commitment to support only the deferred share capital instrument for mutual insurers and friendly societies, and therefore remove the parts of the Bill that concern co-operative and community benefit societies issuing redeemable shares. Secondly, to preserve the principle of mutuality, the Bill clarifies that no friendly society or mutual insurer will grant more than one vote per person for every deferred shareholder—and, further, that no deferred shareholder will receive more votes than an ordinary member by virtue of being a deferred shareholder. Thirdly, there are several minor and technical changes to tidy up the Bill and use more appropriate legislative terminology.
Amendment 1 to Clause 1 restricts the scope of the Bill to allow HM Treasury to make regulations providing for deferred shares for friendly societies and mutual insurers. The Bill will no longer provide a means for co-operative and community benefit societies, which were formerly known as industrial and provident societies, to issue redeemable shares. In order to provide for these deferred shares, the regulations may modify the Friendly Societies Act 1992, the Companies Act 2006 and other primary legislation relating to friendly societies or mutual insurers. The Government believe that granting the regulations the power to modify primary legislation still to be enacted is both necessary and proportionate. It is necessary because there will be a period of time before these regulations are made, and in the intervening period there may be changes to existing legislation that affects friendly societies and mutual insurers which may need to be amended. It is also proportionate because it is limited to the Friendly Societies Act 1992, the Companies Act 2006 and other primary legislation relating to friendly societies and mutual insurers.
Amendments 5, 6, 7, 9, 13, 14, 15 and 16 are related consequential amendments. Government Amendments 2 and 3 make minor technical changes. Amendment 2 uses more accurate legislative terminology to clarify that the power to make regulations under the clause is exercisable by statutory instrument. Amendment 3 specifies that the statutory instrument containing regulations under this clause may not be made unless a draft has been laid before and approved by each House of Parliament. The Delegated Powers and Regulatory Reform Committee reported that it regards this delegation or procedure as appropriate.
Amendment 4 introduces a new clause that provides that holders of deferred shares will not receive more than one vote by virtue of owning a deferred share, and will not receive more votes than they would have had if they had been a member. Friendly societies and mutual insurers already have considerable freedom regarding their rules and internal governance. This maintains that freedom, but also provides that holders of deferred shares do not gain any advantage over other members by virtue of being deferred shareholders. This amendment therefore serves to protect the principle of mutuality.
Amendment 8 introduces a provision that where HMT makes a regulation to specify a particular organisation as a mutual insurer, such regulations are subject to the negative procedure. The Delegated Powers and Regulatory Reform Committee confirmed that the negative procedure is sufficient in this regard.
Amendments 10 and 11 are minor and technical changes to provide that the Treasury has the power to commence the Bill by statutory instrument and that the Treasury may make regulations by statutory instrument to commence the Bill rather than by making an order. Amendment 12 is a minor and technical change to amend the title of the Bill more accurately to reflect that the Bill applies to friendly societies and mutual insurers, permits the issue of deferred shares and restricts the voting rights of members to hold those shares. I beg to move.
Lord Naseby (Con)
My Lords, these amendments arise out of the removal of the redeemable element in the original Bill. It was removed by mutual consent, but I hope in due course, on another day, to come back to that dimension of the original Bill. These amendments meet the Delegated Powers and Regulatory Reform Committee’s ninth report of the Session. The comments from the committee were important and helpful.
The key element of the amendments is that they enable the Bill to go forward and allow friendly societies and mutual insurers to move forward in relation to the challenges they meet today. Looking back over two centuries, friendly societies and mutual insurers have provided insurance for life events for millions of ordinary people. They manage funds in excess of £90 billion on behalf of their members and customers and focus on good value and service quality. In addition, many are regional businesses, which is an important element. I had a debate the other week on cottage hospitals—or community hospitals, as some would call them. They are a wonderful vehicle for involving communities, and the vehicle of a friendly society or mutual insurer is a means of establishing that.
I applaud what the Government have done in terms of helping the whole mutual movement, building on the work done by the Major Government in 1992. We have seen progress in a great many areas of social welfare and other areas of mutuality, but there was this hole and these amendments help to fill it. I shall pick out the key elements these amendments will facilitate. They will facilitate an increase in membership of the firms involved. That is extremely helpful. The key point is that they will fuel organic growth and enable the development of new product lines. They will provide funds for firms to go through acquisitions that they may see as giving them an opportunity. I do not think I need to go into any greater detail. I went into considerable detail at Second Reading and the House may return to that on Report or at Third Reading.
Lord Kennedy of Southwark (Lab)
My Lords, I am delighted to be able to speak on behalf of the Opposition, particularly as a Labour and Co-operative Member of your Lordships’ House, to these amendments moved by the noble Lord, Lord Deighton. This Bill was last considered by your Lordships’ House on 24 October when we had the Second Reading debate. Both the noble Lord, Lord Newby, who spoke for the Government, and I supported the aims of the Bill and what the noble Lord, Lord Naseby, was seeking to do and congratulated him on making substantial progress in persuading others of the importance of the measures and of the need for action to be taken to support and protect the mutual insurance sector which only 20 years ago accounted for 50% of the insurance market in the UK but today accounts for just 7.5% of the same market.
As the noble Lord, Lord Deighton, explained, the Government were not persuaded that the proposed redeemable shares instrument for co-operative and community benefit societies was necessary as societies already had a means of issuing redeemable shares. Discussions took place and with the agreement of the noble Lord, Lord Naseby, the Government proposed to bring amendments in Committee, and they are what we are discussing today. I am happy to support the amendments, as is the noble Lord, Lord Naseby, which remove the proposed redeemable shares element from the Bill and restructure it in a slightly different way which is more acceptable to the Government or parliamentary draftspersons or both. I hope that the noble Lord, Lord Deighton, can assure the House that the Government will keep this issue under review and if it is felt or shown that the proposed redeemable shares instrument may be beneficial to the mutual sector he will look at it again. Perhaps we can again call on the noble Lord, Lord Naseby, to bring such a measure in the next Session because it is important that the mutual sector as whole, not just the mutual insurance sector that the Bill seeks to protect, is protected and is allowed to flourish and grow in today’s modern world of business. It is a matter of great regret that the mutual insurance sector has shrunk so much in a relatively short period of time and that we have lost so many building societies that were once household names, which has been to the detriment of consumers.
I will not detain the House any longer than necessary. I am a supporter of the aims of the Bill and am content with the amendments moved by the noble Lord, Lord Deighton. I wish the Bill a smooth and speedy passage on to the statute book. It is an excellent example of what a good Private Member’s Bill can do, identifying a problem or issue that there is no great dispute about, and seeking to make improvements to the situation which will be beneficial to everyone. This House is very grateful to the noble Lord, Lord Naseby, who is my noble friend. I hope that there will be no amendments on Report and that the Bill can leave your Lordships’ House and be on its way to the other place before Christmas.
Lord Deighton
“( ) A statutory instrument containing regulations under this section may”
Lord Deighton
“Restriction on voting rights
(1) Regulations under section 1(1) must make provision to ensure that no friendly society or mutual insurer will confer—
(a) more than one vote per person as a member on holders of deferred shares who are members of the society or insurer by virtue only of being such a holder;(b) additional voting rights on a member of the society or insurer by virtue of being a holder of a deferred share where the member is a member other than by virtue of being such a holder.(2) Regulations under section 1(1) must make provision prohibiting the holder of a deferred share who is a member of a friendly society or mutual insurer by virtue only of being such a holder from proposing or voting in respect of any of the following—
(a) a resolution under section 85, 86 or 91 of the Friendly Societies Act 1992 (amalgamation, transfer of engagements or conversions);(b) a resolution to similar effect in the case of a mutual insurer, including a compromise or arrangement proposed at a meeting called under section 896 of the Companies Act 2006 (court order for holding meeting);(c) an arrangement made in pursuance of section 110 of the Insolvency Act 1986 (acceptance of shares etc as consideration for sale of company property) or Article 96 of the Insolvency (Northern Ireland) Order 1989 (S.I. 1989 / 2405 (N.I. 19));(d) such other matters as the regulations may specify.
(3) References in this section to the holder of a deferred share are to the holder of a deferred share issued by virtue of regulations made under section 1(1).”
Lord Deighton
““the Companies Acts” has the same meaning as in the Companies Act 2006;
“friendly society” means a friendly society registered and incorporated under the Friendly Societies Act 1992;
“modify” includes amend, repeal or revoke;
“mutual insurer” means a body corporate that—
(a) is a mutual undertaking that—(a) is neither a friendly society nor a registered society within the meaning of the Co-operative and Community Benefit Societies Act 2014, and (b) is of such description as the Treasury may specify by regulations,(b) has no share capital, and(c) has permission to effect or carry out contracts of insurance under Part 4A of the Financial Services and Markets Act 2000; “primary legislation” means—
(a) an Act of Parliament,
(b) an Act of the Scottish Parliament,
(c) an Act or Measure of the National Assembly for Wales, or
(d) Northern Ireland legislation.”
“(2) The power to make regulations conferred by paragraph (a)(ii) of the definition of “mutual insurer” is exercisable by statutory instrument.
(3) A statutory instrument containing them is subject to annulment in pursuance of a resolution of either House of Parliament.”
Lord Deighton
Lord Deighton
Divorce (Financial Provision) Bill [HL]
(10 years ago)
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Baroness Deech
Baroness Deech (CB)
My Lords, I will speak also to the question of whether Clause 6 stand part of the Bill. All these amendments, starting with this one, have at their heart the protection of children and assistance to middling and lower income families, who are facing terrible problems now that legal aid has been removed from assistance in divorce law, and with the exceedingly high number of divorces that we have every year.
The law needed reform anyway, but the urgency that now arises comes from the removal of legal aid. Only this week, the Bar Council reported an 88% increase in the number of people having to represent themselves in the courts. Throughout the Bill, I am trying to provide a framework that is just but which also promotes autonomy, clarity and entitlement. Given that legal aid has been removed—and I do not envisage an improvement in that situation for years to come—we have to help the poor families who are struggling at one of the worst moments in their lives with something expensive and complicated. Noble Lords will all have seen the accounts of cases in which couples have assets of, let us say, £1 million—not so difficult if you have a house—half or three-quarters of which goes on lawyers’ costs because they cannot reach an agreement; they have no firm framework within which to do so.
This first amendment emphasises what was implicit—it would now make it clearer—that the Bill is not meant to affect the existing provision for children, let alone make it worse. This amendment has the effect of retaining untouched Section 25(1) of the Matrimonial Causes Act 1973—note that this House has not revisited that law since 1973—and retains a provision that in dealing with finance after divorce the interests of children under 18 are the first consideration for the court. They are not “paramount”, which is an even stronger word that is used as regards decisions about their residence.
There is of course scope in the Bill, as there has been previously, for the matrimonial home to be preserved for the use of, let us say, the mother and young children until they reach majority, even if a half share has already been allocated to the father but its realisation or liquidation postponed. From that follows the deletion of Clause 6, which spelt that out in a different way. This amendment also serves to preserve Section 25A of the Matrimonial Causes Act—the desirability of the clean break.
We are not talking about child maintenance as such, because there is a new Child Maintenance Service, successor to the Child Support Agency, and that law will continue as ever. I might also add at the beginning for clarification that the noble and learned Baroness, Lady Butler-Sloss, who cannot be in her place today, supports this, and the noble and learned Lord, Lord Mackay, has specifically authorised me to give his view to the House. He says:
“I support your Bill and support the amendments. I think it vital that the law should contain a provision setting out a generally suitable formula for the division of the assets of a divorcing couple that would guide them without recourse to the courts. It would not harm this concept that a discretion should be available to the court to depart from it on cause shown”.
In fact, a general consensus is building up through the courts that something must be done about this law. It is for the run-of-the-mill divorcing couple who can no longer afford legal representation. I beg to move.
Lord Kennedy of Southwark (Lab)
My Lords, I am sure that the House is very grateful to the noble Baroness for bringing forward this Bill for consideration, and I hope that we can make progress today through the Committee stage. I am supportive of what the Bill seeks to do. It is a fact that relationships break down, and proposals to make financial settlements between parties as simple as possible, enabling both parties to retain a greater proportion of their assets, are to be welcomed. As the noble Baroness has explained, this group of amendments seeks to leave untouched Section 25(1) of the Matrimonial Causes Act, which makes it clear that the interests of the children are the first consideration when dealing with finances after divorce. It is also proposed in this group, as a consequence of that amendment, that Clause 6, which dealt with children, should no longer stand part of the Bill, as it would be confusing and could conflict with provisions already in place. These are very sensible amendments, which I hope will find favour with the Government.
The Minister of State, Ministry of Justice (Lord Faulks) (Con)
My Lords, I begin by congratulating the noble Baroness, Lady Deech, on skilfully steering this Bill to Committee stage. I thank her very much, too, for communicating with the Government about the amendments and the thinking behind them; we are extremely grateful for that clarification.
The Government’s position was made clear at Second Reading and it would not be helpful to repeat that position at this stage. Since then, the noble Baroness has met my ministerial colleague, Simon Hughes, who has responsibility for this policy and is aware of the Government’s thinking. I will restrict my comments in Committee to one or two brief points about the amendments and leave it very much at that.
The first amendment relates to Clause 1 and the protection of children on divorce, and it is of course convenient to take Clause 6 stand part together with the amendment. Amendment 1 limits what was the repeal of all of Section 25 of the Matrimonial Causes Act 1973 to subsection (2) of that section, which contains the list of matters to which the court must have regard in deciding how to exercise its ancillary relief powers. This amendment leaves the other provisions of Section 25 in place and, accordingly, restores the court’s duty to give first consideration to children of the family in deciding how to exercise ancillary relief powers, retaining the list of matters to which the court must have regard in making specific financial relief awards in relation to children of the family. The amendment adds considerably to protection for children given in the Bill. As a result of this, the noble Baroness has indicated that she does not wish Clause 6, which contained the previous provision for children in the Bill, to stand part of the Bill. The Government welcome this improvement in protection for children.
Baroness Deech
Baroness Deech
My Lords, in moving Amendment 2, I speak also to Amendments 3, 4, 20A, 21, 22 and 26. What the amendments in this group have in common is that they are minor and technical. I had great assistance with the drafting of this Bill over the summer, as your Lordships will have noticed, and these amendments arise from the refinement of the drafting as it took place in reaching the final state of the amendments.
Amendment 2 is simply a correction, while Amendment 3 is a clarification. Amendment 4 ensures that this law, as I hope it will turn out to be, applies equally to civil partnerships and same-sex couple marriages. Clearly, a new law must apply to all different sorts of couples, whoever they are, who may go through the courts. Amendment 20A has come about simply because there has been a redraft. Amendments 21, 22 and 26 arose from the fact that there has been a preservation of flexibility of lump sums in distribution of property. This entire group is technical. I beg to move.
Lord Kennedy of Southwark
My Lords, this is an important technical group of amendments, which follow on from the previous group in clarifying that the provisions of Section 25(1) of the Matrimonial Causes Act remains in force and that we are referring only to subsection (2), for all the reasons that noble Lords gave in the previous debate, along with Amendment 3, which again makes it clear that we are referring to the Act in the amended form. The addition and clarification of the 2004 and 2013 Acts, as the noble Baroness advised the House, will clarify that the new law will apply to civil partnerships and same-sex couples, but not to cohabiting couples, who are the subject of a different Bill, to be introduced by the noble Lord, Lord Marks, which will have a Second Reading shortly.
The second part of the group removes subsections 5(1) and (2), which deal with the issue of periodical payments, discussed during the Second Reading debate in your Lordships’ House. They seek to address an issue that everyone recognises needs to be looked at; on these Benches we were concerned that there appeared to be a one-size-fits-all approach. In a later group, we will look at amendments that seek to take on board concerns expressed in the Second Reading debate and elsewhere.
Amendments 21, 22 and 26 make clear the divide between lump sum payments and ongoing periodical payments.
Lord Faulks
My Lords, I shall speak briefly to this group of amendments. As the noble Baroness said, a number of these are technical or drafting improvements on which I need not detain the House; I have only these brief comments of substance to make.
I acknowledge the noble Baroness’s intention to limit the potential for litigation under this Bill through her amendments. Amendment 20 is consequential to the removal of paragraphs (b) and (d) of Clause 4(7). It removes the provisions on the making of periodical payments and the duration of such periodical payments and the requirement for the court to consider whether a lump sum payment would be sufficient to meet the needs of the person concerned; it also removes the restrictions and duration limits on the court when making orders for periodical payments, for which the existing subsection (1) of Clause 4 provides.
Amendments 21 and 22 remove from Clause 5 references to lump sum payments as an alternative to periodical payments in Clause 5, and Amendment 26 removes a reference to a lump sum order as an alternative to an order for periodical payments. The Government welcome the greater flexibility for payment of periodical sums provided by these amendments.
Baroness Deech
““2004 Act” means the Civil Partnerships Act 2004;
“2013 Act” means the Marriage (Same Sex Couples) Act 2013;”
Baroness Deech
““relevant financial order” means—
(a) an order for lump sum provision in favour of a party to a marriage under section 23(1)(c) of the 1973 Act,(b) a property adjustment order in favour of a party to a marriage under section 24(1) of that Act,(c) a pension sharing order under section 24B of that Act,(d) a pension compensation sharing order under section 24E of that Act,and also includes any order under the corresponding provisions of the 2004 Act and the 2013 Act.”
Baroness Deech
My Lords, I rise to move Amendment 5. Consequent on it is whether Clause 2 stands part of the Bill. This provision, as amended, is rather more technical, but also flexible. It brings together the definitions of the relevant financial order—the sort of things that the court may deal with—and defines and spells out what was implicit in the original draft, the various types of order that the court may make. After some discussion, lump sum orders are included, as they may assist flexibility in dividing up the total assets. This will assist the court in achieving maximum flexibility. My aim throughout is to promote sufficient clarity to enable people to arbitrate and mediate and yet preserve a little bit of discretion, which is a good hallmark of our law. I beg to move.
Lord Walker of Gestingthorpe
My Lords, this amendment, as the noble Baroness said, introduces a definition of a new expression, “relevant financial order”. The most significant feature of the new definition is that it does not include an order for periodical payments, but to leave it there would perhaps be a rather meagre explanation. In the long run, it might be helpful to considering some later amendments if I speak very briefly about the terminology and structure of the Matrimonial Causes Act 1973.
Many of your Lordships will recall that the concept of no-fault divorce was introduced in England and Wales by the Divorce Reform Act 1969. Scotland followed suit in 1976. The 1969 Act did not contain any provisions altering what was then, in the old-fashioned phrase, called ancillary relief. New provisions were brought in by the Matrimonial Proceedings and Property Act 1970, which for the first time gave the court power to direct the transfer of specific assets, rather than dealing simply with sums of money. The 1969 and 1970 Acts were consolidated in the Matrimonial Causes Act 1973. My noble friend Lady Deech, with great respect, is not quite right in saying that the Matrimonial Causes Act 1973 has not since been revisited by Parliament. On the contrary, it has been amended at least 12 times. I may have got that number wrong, but it is a very much amended Act. However, the noble Baroness is quite right in saying that what Parliament has not revisited is the essential provision in Section 25(2), the guidance as to how judges are to exercise their very wide discretion. As the supporters of the Bill say, that is the provision that cries out for a simpler and more workable test.
The 1973 Act, unusually for a consolidating Act, introduced two entirely new definitions: first, a financial provision order, which was either an order for periodical payments or an order for a lump sum; and secondly, a property adjustment order, which reflected the introduction by the 1970 Act of a power to direct the transfer of particular identifiable assets. The difference between those two forms of order is essentially that between orders for a sum of money and orders relating to identifiable assets. The powers of the court were extended further in 1999 by the introduction of pension sharing orders, and in 2008 by pension compensation sharing orders following the introduction of the pensions compensation Act. That is the range of powers open to the court at present. The new definition of “relevant financial order” includes all the types of order—that is, property adjustment orders, pension orders and lump sum orders, but not orders for periodical payments. The shape of the Bill as we seek to remould it reflects that. Clauses 2 and 4 are concerned primarily with the scope of “relevant financial orders”, as they now would be defined. Clause 5 would be concerned with periodical payments orders, which are treated and stand on their own and to which the Bill adopts the attitude of discouraging them as a long-term measure except when they are essential.
The Bill seeks to amend what is by now a very complex situation. I hope that this definition adds a little clarity to that. Perhaps I may add that if the Bill does go through, it certainly would be high time for there to be a further consolidating Act to replace the much amended 1973 Act.
Lord Kennedy of Southwark
My Lords, this next group of amendments, or one amendment and one clause stand part, seeks to improve the Bill from its original form, taking into account matters brought out on Second Reading. I think that all noble Lords who spoke in that debate thought that the Bill was seeking to address issues that had not been addressed for far too long, so what we are seeking to do here today is very welcome. Amendment 5 in the names of the noble Baroness, Lady Deech, my noble friend Lord Grantchester and the noble and learned Lord, Lord Walker of Gestingthorpe, sets out clearly what a relevant financial order is so that there can be no ambiguity about it. As the noble Baroness, Lady Deech, said, lump sum orders are also included as they may assist in providing flexibility in dividing up total assets. The noble Baroness, Lady Deech, is opposing that Clause 2 stand part of the Bill, as there are amendments down that better define what is sought to be achieved here. If agreed, those amendments will be an improvement to the Bill as it is presently drafted. I can see the logic here and the clarification that that brings.
Baroness Deech
My Lords, I wish to say simply that of course the noble and learned Lord, Lord Walker, is right—that is why he is learned and I am just a noble Baroness and not learned. However, my point is that this House has not revisited the principles of financial provision on divorce in more than 40 years, despite all the changes in society and all the things that have happened—the changes in the position of women, women going out to work and the rise in divorce. It is really crucial to do so now because of the removal of legal aid and the need to help those who mediate and arbitrate and give them a starting point. The Government favour mediation yet there has been a decrease in the use of mediation. How can people mediate if they do not know what the starting point is? To mediate means to find a middle way, and therefore we need a parameter. That is why we are trying to clarify this law.
Lord Faulks
I am sure that all noble Lords realise that what the noble Baroness meant by saying that the 1973 Act had not been revisited was that the approach that was set out in that Act has not been changed since that date. Although there have in fact been a considerable number of amendments to the Act, as the noble and learned Lord, Lord Walker, pointed out, the overall thrust of the noble Baroness’s point remains the same. Amendment 5 moves, in amended form, the list of financial orders in Clause 2 so that they now form the definition of “relevant financial orders” in Clause 1, which deals with interpretation. This amendment goes with the proposal that Clause 2 does not stand part of the Bill, as the provisions for financial orders would as a result be dealt with elsewhere in the Bill.
The Bill as amended will limit the court to making relevant financial orders only to the extent that a binding prenuptial or post-nuptial agreement did not “deal with the matter”, and only in relation to matrimonial property, as defined by the Bill.
Baroness Deech
“Orders limited to matrimonial property
(1) In this Act “matrimonial property” means all property and interests in property, including any pension rights, which could be the subject of a pension sharing order or a pension compensation sharing order, belonging to the parties or either of them at the date of the relevant financial order which—
(a) was acquired—(i) during the marriage; and(ii) otherwise than by gift, inheritance or succession from a third party; and(b) does not directly or indirectly represent property acquired by them or either of them before the marriage.(2) For the purposes of subsection (1)(b)—
(a) any premises and household goods acquired before the marriage for use by them as or in their home shall be treated as acquired during the marriage;(b) if any property that would otherwise fall within subsection (1)(b) is used and applied so as to increase the value of any matrimonial property the property so used or applied shall be treated as matrimonial property;(c) if any matrimonial property belonging to one party is used or applied so as to increase the value of an asset which belongs to the other party, and is not matrimonial property, a proportionate share (by value) of that asset shall be treated as matrimonial property; and(d) paragraph (c) shall also apply if by exceptional personal skill or effort a party to the marriage increases the value of an asset which belongs to the other party, and is not matrimonial property.(3) Subsections (2)(b) to (d) do not apply in relation to any asset if it appears that the costs of investigation and valuation required for the application of the relevant paragraph in subsection (2) would be likely to exceed one-fifth of the amount of the proportionate part or adjustment.
(4) Except as provided in section 3 (pre-nuptial and post-nuptial agreements), no relevant financial order shall be made otherwise than in relation to matrimonial property.”
Baroness Deech
My Lords, I rise to move Amendment 6 and in so doing I propose to speak to Amendments 14, 15, 15A, 16, 18 and 19. They all stand together, forming one of the great pillars of the Bill, which is to seek to bring the law into line with what the Supreme Court in its judgments has more or less inched its way towards—to bring our law into line with Scottish law and the law applying in most of North America and the continent of Europe. In brief, it is that when the court is dividing up the matrimonial property, it should divide only the property acquired after the marriage by the couple. That would aid greatly simplicity and negotiation. Of course, it is not absolutely rigid. The family home will always be treated as matrimonial. I assure your Lordships that there are many provisions and precedents in the law for manoeuvring that situation to ensure that children, and usually their mother, stay in the home until they leave for university or careers. Incidentally, it is an interesting question whether one should treat children as ending their childhood at 18 or whether, as it is now so common for school-leavers to go to university or college, one should say that they need the protection of the law in that respect until they are 21.
There is, however, room for manoeuvre in this amendment. It is modelled on New Zealand and Scottish law and makes provision for how to treat property that was separate but has been increased in value by the assets or efforts of the other party. It is not the case that selfishness will be promoted. If one spouse works on the premarital property of the other, a proportion would be regarded as reverting to the ownership of the one who has put in the effort.
Again, this is a law, and this is an amendment, for the average couple. Very wealthy couples will always be able to afford lawyers and may make prenups and sort out the property between them. This is for the hundreds of thousands of couples who get divorced every year and are clogging up the courts and having to face each other in court without representation and with no clear guidance on what would be a fair and equitable settlement. If this Bill is passed, this provision in particular would give them a steer.
Noble Lords may have seen the report last week that a couple spent £1 million on lawyers and experts while fighting over the division of assets worth £2.9 million. There was a call to cut excess litigation costs and for cost caps. However, you cannot cut unless you make the law simpler and clearer and give couples a starting point for mediation. A cartoon in the Times yesterday showed two lawyers expressing shock and horror over the case I mentioned and at the fact that one-third of the assets was used up in costs. A final box in the cartoon says, “Absolutely shocking! When I did a divorce case, we used up half the assets”. This situation cannot be allowed to continue. It would be better to have broad-brush justice to help those struggling without legal aid and lawyers. I mean no criticism of the Supreme Court. Its judgments have been sophisticated and compassionate. But only the richest people reach the Supreme Court and the level of detail and sophistication that its judgments have provided does not help the man or woman in the high street battling over how to divide up their sparse assets, and where every penny spent on costs takes money away from the children.
Amendment 14 would simply change the date on which the valuation of the assets is calculated. I was advised by judges that I should make this change, which would change the date on which the financial order is made. Amendment 15 is consequential drafting. Amendment 15A would provide maximum flexibility by allowing people to carve up their assets by using lump sums, not necessarily chopping the house in half or having to sell it but using such assets as they have to reach a 50:50 settlement in their negotiations. Amendments 16, 18 and 19 spell out the ways I mentioned earlier of departing from a 50:50 split in certain circumstances, mostly where one party has put in extra effort or, indeed, for the protection of the children. Flexibility would be maintained but couples who know nothing about the law would be able to start with the presumption that whatever they acquire after they get married should be divided in half. I used to run an all-party parliamentary group on family law in this House and members of the public attended its proceedings. They did not always understand the niceties but one message came through from the hundreds of people who attended the proceedings. They said, “Please, can’t we have a booklet when we get married to tell us what our rights and duties are and what’s going to happen to us—what we will owe—when we get divorced? We ask people and nobody can tell us”. This is what I am trying to provide. Here is a guide to what will happen in the unfortunate event of people getting divorced. I beg to move.
Lord Grantchester (Lab)
My Lords, I thank the noble Baroness, Lady Deech, for her great efforts to allow the courts to bring certainty to this situation. As regards her last comment, I hasten to add that I do not think people enter marriage with the idea that they are going to get a divorce. Similarly, I do not believe that anybody turns up to work with the intention of fouling up, but these things happen. I support the amendment as it would bring certainty and enable couples facing divorce to be given clear advice on what their future situation will be and how the matrimonial assets will be divided. The starting point for this process should be that of defining what the matrimonial assets are.
Lord Walker of Gestingthorpe
My Lords, I will speak to Amendments 6 and 15A. As the noble Baroness, Lady Deech, said, Amendment 6 is one of the main pillars of the Bill. The revised proposed new clause embodied in Amendment 6 lays down the general principle that matrimonial property is to be divided equally in normal circumstances. That is the easy bit. The more difficult bit is defining with reasonable precision what matrimonial property is. The revised proposed new clause largely reproduces—we hope in a clearer form—what was in the Bill as introduced, although there are one or two significant alterations to which I shall draw attention. I recognise, of course, that in this context clarity is a pretty relative concept and that the proposed new clause is not particularly easy going.
One way of viewing the proposed new clause is as laying down three general principles in proposed new subsection (1), followed by four qualifications or refinements in the four paragraphs of proposed new subsection (2). The first general principle is that property acquired before marriage should not be regarded as matrimonial property but as—to use a clumsy but unavoidable term—non-matrimonial property. The second general principle is that gifts received from third parties or inheritances or intestate succession to the estates of third parties are also to be treated as non-matrimonial property, even if the gift is made, or the death occurs, during the marriage. I should treat the third general principle at some length because it differs from both the Bill as introduced and from the Scottish legislation embodied in the Family Law (Scotland) Act 1985, from which these provisions are fairly obviously derived.
I mention in passing that I very much regret that my noble and learned friend Lord Hope of Craighead cannot be here today because he, as former Lord President in Scotland, has unparalleled experience of the practical working of Scottish legislation. I have had the advantage of some discussion with him but I take responsibility for what I say about the law of Scotland, which will be far less learned than if it came from him.
Baroness Shackleton of Belgravia (Con)
My Lords, I rise to thank the noble Baroness, Lady Deech, for bringing in the Bill and to declare my interest as a practitioner in matrimonial law for 30-plus years. I am grateful to the noble Baroness because the Bill is overdue and much needed. It provides some clarity and simplicity for those of us who operate in the field, at the moment without proper statutory guidance. It is vital that the matters that she is addressing are put forward for debate, and reform is long overdue.
The simplicity behind the Bill is wonderful. It applies not only to what happens when things go wrong and people get divorced but to the drafting of prenuptial agreements, which is practically impossible if one does not know what is going to happen at the other end if a marriage, civil partnership or same-sex marriage is dissolved. Such agreements are become increasingly fashionable, despite the fact that there is nothing in Section 25 of the 1973 Act about the enforceability of prenuptial agreements. The courts are therefore enforcing them in circumstances that they think may or may not be fair. There is no official guideline from Parliament as to how they should be enforced.
There should be a purer definition of what people can expect upon the breakdown of a marriage. This is not for rich people who can afford to spend a small percentage of their money litigating matters. They can have the luxury to do what they want, like they can in everything else. This is for the average person who goes into a marriage trying to protect the assets that they previously acquired and knowing what they are going to end up with, should it break down. I welcome these amendments and the Bill. I thank the noble Baroness very much indeed for introducing it.
Lord Kennedy of Southwark
My Lords, this amendment in the names of the noble Baronesses, Lady Deech and Lady Wilcox, my noble friend Lord Grantchester, and the noble and learned Lord, Lord Walker of Gestingthorpe, and the other amendments in the group—namely, Amendments 14, 15, 15A, 16, 18 and 19—deal with matrimonial property, an issue central to the Bill.
The new clause proposed by Amendment 6 is detailed and, as we have heard from the noble Baroness, Lady Deech, and the noble and learned Lord, makes it clear that the split of assets on divorce should be limited to property acquired after marriage by the couple. The family home will be treated as matrimonial but property, gifts and inheritances acquired before the marriage will not be matrimonial or available for sharing.
I very much see the point that without the certainty that the proposed new clause aims to give, couples run the risk of spending vast sums of money fighting over the division of assets and thereby reducing the assets that they are left with. As the noble Baroness, Lady Deech, said, to reduce costs we need to make things simpler and clearer for divorcing couples. These are welcome amendments that seek to do just that. I also associate myself with the comments of the noble Baroness, Lady Shackleton of Belgravia, in thanking the noble Baroness, Lady Deech, for bringing forward the Bill.
Lord Faulks
My Lords, the amendments in this group would provide greater clarity about how the court is to approach the making of orders dividing matrimonial property on divorce. Clarity and a degree of certainty are clearly desirable. Against that, one has to weigh the need for flexibility, with the possibility that flexibility can sometimes bring fairness that certainty precludes. I am very grateful for the way in which the group was introduced by the noble Baroness, and indeed for the elaboration by the noble and learned Lord, Lord Walker of Gestingthorpe. He explained with great lucidity the attempt to improve upon the Scottish definition to deal with the problems of portfolios and the like, which may change and therefore change their character in legislative terms.
The proposed new clause seeks to define matrimonial property as property acquired “during the marriage”, rather than property owned before the marriage by either party, or property received as a gift during the marriage. Its intention is to clarify the definition of matrimonial property, which, under the terms of the Bill, will be the only property in respect of which financial orders can be made on divorce, except where there is a significant additional contribution by one party, or if the property has increased in value. The noble and learned Lord described what is meant by a significant additional contribution.
Matrimonial property would normally be divided equally between the parties. The Government have concerns over the definition of “matrimonial property” and the rigid equal division of matrimonial property, as the definition may be unfair in many cases: an equal division of property is rarely found in most ancillary relief cases, due to the lack of assets of the family, and the needs of the children and of the family. If the provisions of the Bill were to be taken forward we would need to define matrimonial property extremely carefully to ensure that any division was fair.
Existing provisions for division of property on divorce give the court a wider discretion to divide property and determine who should have which assets, in the context of the needs of the family. That enables the court to seek to achieve fairness in all the circumstances. The Government are not convinced that the certainty that the Bill and these amendments intend to provide would not come at too great a cost in rigidity. Therefore, the Government believe that the definition of matrimonial property in the Bill is problematic and, I fear, continue to have significant reservations about it.
Amendment 14 is in a different category. It would clarify the date on which the net value of the matrimonial property is to be valued. Instead of the “relevant date” described in Clause 4(4), the valuation is to be made on the date of the relevant financial order made by the court. This provides a clear and unequivocal date for the valuation: the date on which the property is divided. Consequentially, Amendment 15 removes the definition of the date at which the matrimonial property is valued in Clause 4(4). That is clearly desirable.
Amendment 17 would insert a new subsection into Clause 4, describing how a lump sum order is to be taken into account on the division of property on divorce. A lump sum payment is to be taken into account as part of the equal sharing of the matrimonial property, irrespective of the assets used to pay the lump sum. The amendment clarifies the position as to how lump sum payments are to be taken into account.
The Government welcome the greater clarity that would be introduced into the Bill, but as I have indicated remain concerned about the lack of flexibility for the court to determine how to divide property on divorce, and about the fact that the provisions in the Bill apply only to matrimonial property, allowing no flexibility for the court to consider what might be fair to the parties of a marriage in particular circumstances. I acknowledge the noble Baroness’s intention, through her amendments, to limit the potential for litigation under the Bill. The Government and all noble Lords are particularly aware of the unsatisfactory nature of the law, in the sense that it can so often lead to protracted disputes.
Amendments 18 and 19 concern Clause 4. They would remove paragraphs (b) and (d) from Clause 4(7), so that, under the Bill, the court would no longer have to take into account the source of funds not derived from the efforts of the parties during the marriage when making an unequal sharing of the matrimonial property—nor would the court have to take into account the nature and use of the matrimonial property in such circumstances.
Baroness Deech
I completely appreciate the Government’s concerns on this. We are united in wanting to ensure that the costs of litigation are removed or reduced and that people get fair shares. It is a very difficult issue. I do not want to withdraw the amendment at this stage, but given that the Bill will have many more stages to go through—including, I hope, in the House of Commons—I and others would be happy to enter into discussion with the Government on this very tricky issue of how to define what should be shared, bearing in mind that the Supreme Court has already indicated, in a number of judgments, that sharing matrimonial property is the way forward. That has to be our starting point, even if we try to refine it in the many stages that lie ahead of us before the Bill becomes law.
Baroness Deech
Baroness Deech
My Lords, in moving Amendment 7, I will speak to Amendments 8 to 13 as well. What binds them together is that they concern prenuptial and post-nuptial agreements.
First, let me counter criticisms I have heard. Unfortunately, it is no good saying that nobody ever contemplates the end of their marriage. Only too sadly, it is unavoidable to think of it. There cannot be anyone in this House who has not had a member of their family go through divorce—or, indeed, has not been divorced themselves. It is a very current feature of life. I know the arguments that the Bishops might have put forward, had they been here: that having a prenuptial agreement somehow undermines marriage. That is not so. Such agreements are common in every country in Europe and in North America. In all those places the divorce rate is lower than it is here, except possibly in the United States. I do not think it can be argued that they in any way undermine marriage. Moreover, the Supreme Court swept away the public policy issue that there is somehow something wrong with making an agreement about the end of a marriage in the famous case of Granatino v Radmacher, which was unusual in that it was the wife who was very wealthy and the husband, although comfortable, was not quite so wealthy.
First in this group, I took account of what was a glaring omission in the first draft. The prenuptial or post-nuptial agreement must of course be in writing. That is covered by Amendment 7. This was a mere oversight. It follows the recommendation of the Law Commission in its report on matrimonial property agreements and it follows practice abroad. There can be hardly any dissent from that. Amendment 8 is an improved draft: a way of saying that prenuptial and post-nuptial agreements are binding.
Amendment 9 is about disclosure. Obviously, if people are making a prenuptial or post-nuptial agreement they ought to tell each other what their assets are before they sign it. This amendment seeks to deter legal challenges to an agreement if a small or unimportant asset was overlooked and not declared. For example, if a wife omitted to mention in her list of assets her second-hand car kept somewhere else in the country, one would not want the agreement voided for that unimportant failure to disclose. How many of us could at any time make a completely comprehensive and accurate list of everything we own? Therefore, the amendment provides that a failure to disclose will not ruin the prenup or post-nuptial agreement provided that the asset is not of great significance. I have been advised by judges that there is no need to make any fresh statutory rules about disclosure—hence Amendment 12.
Amendment 11 is meant to prevent someone who would not be damaged taking advantage of non-disclosure. Others will give more substantial examples of that. For instance, if a wife failed to disclose her second-hand car, she could not rely on that to destroy the prenuptial agreement so as to give her an advantage. The idea is that, set against a background of clarity in dividing up assets, the court will accept the prenuptial or post-nuptial agreement as binding.
The Supreme Court has already almost worked into that position, but it attached so many conditions in the well known case of Granatino v Radmacher that about a dozen other cases followed where couples argued simply over whether the prenuptial agreement was binding. If they start going to court to argue about that, the very point of the agreement is undermined and costs accumulate.
The provisions in this group of amendments cumulatively will give very strong, although not complete, force to the binding nature of a prenuptial or post-nuptial agreement. Because the normal laws of contract will apply, if there is a mistake, duress or fraud, it will be possible to undermine a prenup. Section 35 of the Matrimonial Causes Act provides, in limited circumstances, a way to attack a post-nuptial agreement, so that is already quite common.
The great advantage of this provision is the encouragement that it will give people to get married. The noble Baroness, Lady Wilcox, who apologises for not being in her place today as she has been called abroad on urgent business, told me enthusiastically about her feelings and those of other Members of this House of riper years who might contemplate a second marriage. People who do so, having once been widowed or divorced, may well say to themselves, “But if I get married again, all the property that I inherited from my first husband or everything I have worked for might, in the event of a second breakdown, go to the second spouse and his family”. I think that most people of a riper age who are thinking of getting remarried would prefer to keep their property for their original family, and the existence of a prenuptial agreement would encourage and help them.
The prenuptial agreement is very common in other countries. Of course, as your Lordships know, there is many a transnational marriage these days. People who were married abroad get divorced here and vice versa. An English person marries someone from abroad who takes it as a matter of course that there should be a prenuptial agreement. Years ago, I had a student at my college in Oxford who got engaged. She came bouncing in to see me and said, “I’m engaged, Mrs Deech. I’m engaged. Who do I go to? Which lawyer do I see about my prenup?”. That was about 20 or 30 years ago, and one can well imagine how my jaw dropped. However, she was Canadian, from Quebec, and that is what they do in Quebec, in France, and in other places. Having decided to get married, the young couple go off and see a lawyer to discuss what they call the “matrimonial regime”, where they talk about what sort of property ownership will apply. It does not undermine their marriages in those countries. As I have said, their divorce rate is lower than ours.
I find it very curious that when the average couple in this country spend £20,000 on arranging a wedding, and spend years doing it—we all know just how complicated these things are—they do not spend just a few pounds on going to see a lawyer to decide who is going to own the property and how things are going to be sorted out. It runs contrary to our nature—or at least it used to. However, I think, and hope, that the noble Baroness, Lady Shackleton, will explain to us that these prenups and post-nups are catching on, because, sadly, none of us can be unaware of how these things can go wrong and what it will cost us. As I said, the Supreme Court has already pretty much worked itself into this position.
Therefore, I very much hope that your Lordships will accept this group of amendments, which will make prenups and post-nups binding against a background of dividing up assets fairly on divorce and will give couples a clue as to what is fair when drawing up a prenup. Alternatively, they might say, “No, I’m not going to draw up a prenup. Don’t you love me? We don’t need a prenup”. I am sorry to say that that would be a bit naive these days but this group of amendments would greatly improve the situation for couples with a foreign element, older couples embarking on a second marriage and couples where there is a great disparity of wealth: the model who marries the footballer, the singer who marries the Russian oligarch and so on. It is perfectly understandable that they might want to discuss how those assets should be owned and divided up. It is too late for me, I am afraid, but not necessary anyway. However, I very much hope that this House and the Government will recognise that that is modern society and that the amendments would greatly help a number of couples. I beg to move.
Baroness Shackleton of Belgravia
My Lords, I support the concept behind this pillar of the Bill. It is vital that there is more clarity as to when, why and where prenuptial agreements should be binding. If they are made de rigueur in this country, as they are in other countries, there will not be any romance in it; it will just be like trotting along to get your marriage licence. There will be WH Smith forms and, if the couples do not take legal advice, they will be protected.
There are problems because the current law does not provide for binding prenuptial agreements but there is a lot of travel within the European Community. People come to this country having signed a prenuptial agreement which is not a prenuptial agreement: it is a property regime which, with no legal advice, is translated into a prenuptial agreement in this country, and it causes a lot of problems. If people know in clear terms that those are not going to work, then they will know where they stand. They will know what will work and they can be given appropriate advice before they arrive here if they are intending to come to this country.
My noble friend Lady Wilcox believes that this proposal will positively encourage marriage, and I support that wholeheartedly. Unfortunately, I see a cottage industry in my profession of stepchildren encouraging divorce. It is forced upon a parent so that the parent can, putting it crudely, collect the money before they die because there is no prenuptial agreement. Therefore, divorce is being promoted by stepchildren so that assets on one side of the balance sheet can be collected and they can profit by inheritance. That is ugly. A prenuptial agreement would avoid such circumstances.
Also, second marriages are often broken by stepchildren. If those stepchildren know that their financial security is intact and protected by law, there is every chance that the marriages will survive. Speaking in my other capacity as a patron of the Marriage Foundation, I believe that everything should be done to enhance the prospect of people remaining married. Prenuptial agreements protect people because they know what will happen to them should the ghastly event of divorce happen. It is very important that people get independent legal advice because at the time they get married they are, in my experience, concentrating on the dress, bridesmaids, venue and canapés and not what may go wrong. To have people in love not being properly shown the horrors of divorce is a mistake.
I wholly agree with this measure becoming part of the statute. I was the lawyer for Mr Granatino and it was an ugly shock when the Supreme Court decided to apply contractual measures to something that had hitherto, as part of the Matrimonial Causes Act, not been legally enforceable.
Lord St John of Bletso (CB)
My Lords, I add my support for prenuptial agreements. I say that in the context that I trained as a Roman-Dutch lawyer, under which law a prenup is recognised. In an era when we have one of the highest divorce rates ever, certainly this is the time to simplify this important part of divorce law.
I say a prenup rather than a post-nup because obviously a prenup is more certain and there is far less scope for negotiation than with a post-nuptial agreement. But a prenup makes the likelihood of successful mediation far more likely than is the case now.
A common theme of the Bill has been to provide more certainty. Ideally, we want a clean break for those going through the unfortunate process of getting divorced. Apart from the huge cost of lengthy divorces, not much has been mentioned today about the huge stress that this has on children from this prolonged and tortuous process. The noble Baroness, Lady Wilcox, mentioned the important fact that, without this protection, those who have gone through traumatic divorces are far less likely to want to get remarried. I am sure that she will also have mentioned that 16 million people in Britain are over the age of 65. That is another reason why this clause should be promoted.
Lord Cormack (Con)
My Lords, I was not intending to speak but I have one or two points to make. When my noble friend talked about a cottage industry I thought that was probably scaling things down a little; it is a mansion industry rather than a cottage industry. I accept the total impeccable logic of the case advanced by the noble Baroness, Lady Deech. She is talking about an unfortunate necessity. Only this week I met a young girl in her 20s. I have known her since she was born. She married with great hope less than 18 months ago and the marriage is foundering now. Of course, I accept all that, but am I alone in your Lordships’ House in expressing infinite regret that we are where we are?
Baroness Deech
My Lords, it might surprise the noble Lord, Lord Cormack, to know that I am absolutely with him on the importance of marriage. I have spent much of my academic career writing about it in an atmosphere where I was almost a lone voice. I am with him all the way. I wish there was more we could do about it without being accused of claiming the moral high ground and so forth.
Nevertheless, I have studied the situation and realised, as the noble Baroness, Lady Shackleton, pointed out, that this is going on. The Supreme Court has recognised it. It is for this House to grab a hold of it. We should grab hold of all this law, which has been interpreted and elasticised and twisted around by the judges for 40 years without this House getting a grip on the principles. Now is an opportunity to recognise that we are where we are with 100,000 couples divorcing every year, leaving aside the many more breakdowns of cohabitation—and possibly in the future, civil partnerships and the relationships of same-sex couples who have not turned up in the statistics yet. My heart is absolutely with the noble Lord.
Lord Kennedy of Southwark
My Lords, this group of amendments starting with Amendment 7 in the names of the noble Baronesses, Lady Deech and Lady Wilcox, and my noble friend Lord Grantchester are all to Clause 3, which concerns prenuptial and post-nuptial agreements.
I see the arguments made that these agreements, which were not very common a few years ago, are on the increase and can provide certainty to both parties as to the division of assets in the result of a breakdown of the relationship. I recall the comments of the noble Lord, Lord St John of Bletso, when he told us at Second Reading that these agreements had in no way encouraged the breakdown of marriage. Also, the noble Baroness, Lady Wilcox, spoke about people who had been widowed or divorced and were afraid to marry again where there were assets they wished to protect and who were reluctant to commit again, fearing a potentially financially disadvantaged position at a time of life when starting again would be almost impossible. The noble Lord and other noble Lords spoke about this again today.
The amendments themselves seek to provide further clarity as to what this Bill seeks to do in respect of pre and post-nuptial agreements and build on the comments and points raised both inside and outside your Lordships’ House.
Lord Faulks
My Lords, this has been a useful and instructive debate on this interesting and significant area. There are those who retain great faith in the institution of marriage. The noble Baroness herself said that, and I for one see no tension between thinking that and nevertheless being of the view that it is important there should be some sensible provision about prenuptial agreements. Her student may have been anticipating a trend by suggesting going to a lawyer almost immediately, in the heady days of announcing her engagement. A number of popular songs that suggest going to see the preacher at that juncture may have to be amended to reflect this different approach.
These amendments all relate to this clause. Amendment 9 changes the threshold of the duty of disclosure placed on both parties for the prenuptial or post-nuptial agreement to be binding on both parties. The Bill currently requires that the parties fully disclose their assets before the agreement will be binding on them and this amendment would require only “proper disclosure”.
Amendment 7 corrects the omission of the requirement in the Bill for a prenuptial or post-nuptial agreement to be made in writing. I recall that that point was specifically drawn to the House’s attention by the noble and learned Lord, Lord Scott of Foscote, at Second Reading. As the noble Baroness said, this is an essential prerequisite and a key feature of the recommendations made by the Law Commission.
The intention is clearly to protect people entering into prenuptial agreements by imposing the formality of a written and signed agreement. However, the Government have already indicated that we have reservations about the lack of flexibility in the Bill for the court to override an agreement that is unfair or does not adequately provide for “needs”. This is especially so given that people often enter into a prenuptial agreement at a point when they are not as realistic about events, sadly, as they should be.
The Government has yet to consider the detailed proposals for binding matrimonial property agreements put forward by Law Commission in its report on Matrimonial Property, Needs and Agreements. We have informed the commission that a final decision on the proposals should be made by the new Government after the election. However, the Government would not seek to oppose this amendment to the Bill.
The requirement under the existing divorce process is for both parties to make,
“full, frank, clear and accurate”,
disclosure of their assets using form E. We have concerns that undefined “proper” disclosure would be open to interpretation and offer scope for possible hiding of assets in a way that the current requirement is designed to avoid.
Amendment 8 amends the formulation of subsection (1) of Clause 3 and, if I have understood it correctly, is intended only to tidy up the drafting and not to change its substantive effect. The amendment seeks to replace the words,
“binding on the parties and is to be given effect unless”,
with “binding on them unless”. However, I believe that normal legislative drafting convention means that the effect would be to omit the crucial word “unless”, which is necessary to apply the conditions set out in paragraphs (a) to (e) of subsection (1).
Amendment 11 inserts a new substantive provision into the clause which sets out the requirements for a prenuptial or post-nuptial agreement to be binding. It does not set a new condition for the agreement to be binding; rather, it provides that only the person who has been disadvantaged can rely upon failure to obtain legal advice or failure to disclose assets as a means to make the agreement non-binding. The Government remain generally concerned about the lack of protection for people entering into binding prenuptial or post-nuptial agreements under the terms proposed in the Bill. These amendments do not appear to improve significantly on the protection offered and are substantially different from the approach recommended by the Law Commission, which would preserve the ability of the court in appropriate cases to override an agreement made between the parties where in the view of the court its terms are manifestly unfair or where they fail to provide adequately for needs. The Government have yet to consider the Law Commission’s detailed proposals. In relation to the Bill we are concerned that leaving prenuptial agreements to be subject to the rules of contractual law around validity and enforceability, and post-nuptial agreements subject to review by the court under the provisions set out in Section 35 of the Matrimonial Causes Act 1973, does not amount to a coherent set of protections.
Amendment 12 would remove the possibility of the Lord Chancellor making rules to specify what constitutes the full disclosure of assets, which is one of the requirements in the Bill for the prenuptial or post-nuptial agreement to be binding. The noble Baroness said that she has been advised that the law in relation to disclosure is sufficiently clear not to need further elaboration. As already noted, the second amendment would alter “full disclosure”, which as she rightly says is well understood, to “proper disclosure”. The Government agree that there are already established principles around disclosure. I understand that the noble Baroness is really concerned with what might be regarded as de minimis omissions from the list, but I do not think that that would in fact cause a difficulty on the existing rules. We are concerned that the use of the term “proper disclosure” could open up some areas of concern.
Baroness Shackleton of Belgravia
Would the Minister clarify that he is talking about form E? Form E is an incredibly detailed analysis of someone’s wealth; it could not be fuller than full disclosure. Is the Minister talking about disclosure of that nature, because I think that the amendment is meant to catch disproportionate non-disclosure? Form E is the most comprehensive document known to man. It goes down to the last £500 or number of pairs of cufflinks that a man may own.
Lord Faulks
I am not seeking to suggest that form E is not an extremely thorough document and I am sure that my noble friend is absolutely right on the point. But the amendment seeks to alter the rules from “full disclosure” to “proper disclosure”. If form E is going to be what proper disclosure is, my noble friend may well be right. My point is simply that proper disclosure appears to be a different description. If I have understood her correctly, the noble Baroness, Lady Deech, said that this was in order to ensure that the whole thing could not be set aside on the basis of a failure to include in the list something that someone had forgotten about or which was so trivial that it did not enter the heads of those entering into it. I understand that that is the aim, but the Government remain concerned that “proper disclosure” could open the door to someone saying, “Well, it was not proper for me to disclose that”. That is my answer to my noble friend.
Finally, Amendment 13 alters the court’s powers when dealing with the division of property on divorce when a prenuptial or post-nuptial agreement is to be treated as binding on the parties so that instead the court can make a financial order as described in amended Clause 1(3). The orders the court can make under the revised clause are an order for a lump sum payment, a property adjustment order, a pension sharing order, a pension compensation sharing order and corresponding provisions of the Civil Partnership Act 2014 and the Marriage (Same Sex Couples) Act 2013 in so far as the provisions of the 2013 Act are not already covered by the provisions of the Matrimonial Causes Act 1973 as amended by the Bill. This increases the range of orders which can be made. However it still falls some way short of the flexibility that the courts currently have under the 1973 Act and, for the reasons I have already given, the Government still have some concerns about the approach.
Lord Davies of Stamford (Lab)
The noble Lord said that one of the reasons why the Government would introduce the full setting aside of a prenuptial agreement would be “need”. If that is the case, would that not, first, have the potential to open up an area of great ambiguity and uncertainty because “need” would have to be defined very closely? Secondly, would there not be a real risk that “need” could be interpreted by a court as being the right to retain the same standard of living as had been the case when the party had been married, and that might be possible only by drawing on prenuptial, non-matrimonial property? That would undermine the whole purpose and force of the Bill. Will the noble Lord say a few more words about how the Government envisage defining the word “need” in this context?
Lord Faulks
The noble Lord makes an important point. What I did say was that the Government had not yet concluded how they proposed to respond to the Law Commission’s recommendations. The Law Commission has said that it considers it appropriate to override an agreement in some cases. I take entirely his point that if, as it were, the court is going to have a free rein to override an agreement simply because it thinks it fairer in the circumstances to come to a different conclusion, that would significantly undermine the degree of certainty which can be obtained by a prenuptial agreement. However, at the heart of what the Government will have to decide on this is to respect all the advantages that one can obtain from having a prenuptial agreement for the reasons that have already been outlined in the debate, yet not making it iniquitous in some circumstances—limited circumstances, I would imagine—where it is manifestly unfair for a party to be restricted by the scope of that agreement.
Baroness Deech
My Lords, I am sure that the Minister will agree that the best should not be the enemy of what is workable and good going forward. I am also sure that the Minister and I are united in the deep concern I have about the unfortunate couples who are wasting their money as they go through the process at the moment. I am willing to try almost anything because this has been a concern of mine for the past 40 years. We need a framework for couples that is more in line with what is tried and tested in New Zealand, Australia, Scotland, North America and Europe. While appreciating that this is an issue in flux and the fact that the legislation I am proposing would still have to go through the Commons, I hope very much that the noble Lord will be open to discussion with me and other concerned parties about how to get exactly the right wording in relation to proper disclosure—I absolutely understand his concerns—and the flexibility that is necessary. I am convinced that we must do this and I believe that the Minister shares that concern.
Baroness Deech
“( ) Any non-compliance with subsection (1)(b) or (d) may be relied on only by the party disadvantaged by such non-compliance.”
Baroness Deech
“( ) The amount of any order for lump sum provision in favour of a party to a marriage shall be taken into account as part of the equal sharing of the matrimonial property (irrespective of what assets are actually resorted to by the other party in compliance with the order).”
Baroness Deech
Baroness Deech
Baroness Deech
Baroness Deech
My Lords, Amendments 23 to 25 are all about what we specialists call periodical payments, which, I ought to explain to the House, are ongoing maintenance payments that many people are familiar with, whereby usually a husband, although not always, is ordered to pay his ex-wife a monthly or annual sum, year in, year out. A Member of this House has told me that he is still paying maintenance to his ex-wife after 30 years and many intervening marriages.
In fact, only about 12,000 such orders are made every year, although, as I have said more than once, there are more than 100,000 divorces every year. Not many of these orders are made, which must mean that people are reaching their own agreement: they are settling the matter once and for all by a lump sum, or, very likely, there simply is not any money to go around. As I have said before, the law that I am trying to reform affects largely lower and middle-income people. Of course, as we know, in the lower income bracket, people may well be living on benefits with a great deal of state subsidy; there simply is no money to go around and no order is made.
Noble Lords will recall the great difficulty there has been over the decades in trying to extract from fathers, who have no reason to object, ongoing maintenance for their children after a divorce. It has been like trying to get blood out of a stone, and so it remains. I suspect that in many of these divorces no order is made because one or both of the couple are living on benefits.
In many ways, the current law is regressive. Reverting to an analogy I have used before, were I or any other noble Baroness in this House so fortunate as to marry a footballer for a brief period, we could expect at the end of the marriage, which undoubtedly would come about, to be kept in that particular style for ever and ever—it really is not that amusing; that is the law at the moment—whereas if a noble Baroness in her youth was so altruistic as to marry a vicar she would get absolutely nothing, or next to nothing, on divorce. I have said for many years—and I have been involved in educating women all my career—that the message that goes out is, “Find that footballer and sit back”.
The Law Commission has said that periodical payments—maintenance—should be a transition. In an era when women, mothers included, are expected by the Government not to claim benefits once their child is six, it is very hard to argue that once a woman has children she should always be kept after the end of the marriage, let alone if she has no children or those children have grown up. I am sure that noble Lords know from their acquaintances the inequity and rather arbitrary nature of what goes on.
The Law Commission has said that maintenance should be a period of transition to full independence. We know that this may be hard on the older woman but it may very well be that there are lump sums and a division of assets. Moreover, I have shown in these amendments that I am listening to the concerns of the Government. At Second Reading they said that this may be hard. These amendments therefore say that maintenance should last in the first instance for five years—which represents the average period between the end of one marriage and the beginning of another—and that they may continue where there is evidence of “serious financial hardship”.
To change the law in this way would be only to bring us into line with what goes on, as I have said before, in North America, the rest of Europe, Scandinavia, Australia and New Zealand. It is very hard to argue, when our divorce law, rightly or wrongly, is no longer based on fault but on irretrievable breakdown—“This marriage has come to an end; it is nobody’s fault”—that a man should continue to keep his ex-wife in the style to which she became accustomed for ever and ever until the end of their joint lives. It does not actually happen—as I said, there are only 12,000 cases.
I will quote briefly from some of the blogs. Whenever I mention this in public, the public come back and say things such as,
“desperately needed reform of financial proceedings on divorce … The financial interests vested in the current lawlessness are colossal … all that comes out of court is injustice, direct/indirect discrimination … It is fundamentally unfair and an affront to the rule of law that the outcome of cases should vary randomly to such a degree”.
Even the Law Commission reported that its consultees said that operating financial provision in divorce for a judge is like a bus driver being given a bus and told to drive it but not being told where that bus is to end up.
What is the objective of maintenance at the end of divorce? The House has not really got to grips with this ever since the change in the divorce law in 1969. Actually, periodical payments are withering on the vine. It is time for us to give a steer. I absolutely understand that the Government have concerns and think that people will end up on benefits, but the people who are likely to do so are living on benefits already.
I have provided in Amendment 24 that the period may be extended. Again, I quote from some of the consultees:
“Many people going through divorce have grown sick and tired of hearing that the legal profession has spent the decades since the Matrimonial Causes Act was enacted failing to develop a coherent set of straightforward principles to govern division of income and assets on divorce”.
Another says:
“ The Scottish system”—
which I am copying here—
“is by no means perfect, but it does at least provide a framework for dealing with financial provision. Legislation will always be open to interpretation by lawyers … The public should however be able to rely on and understand a basic set of provisions regulating the division of matrimonial property on separation and divorce”.
Another said:
“Nobody knows where they stand. The judge you get on the day can do virtually anything based on a whim”.
That is how it seems—a point made strongly by the noble Baroness, Lady Shackleton, at Second Reading.
Moreover, one must remember that many women now, especially younger women, are earning more than their husbands. Men somehow seem to take it on the chin when they have to pay maintenance to their ex-wives, but there is nothing like the fury of an ex-wife who already feels that she has been betrayed by the man she married who is earning less than her when she realises that she is going to have to keep him for the rest of his life. I beg to move.
Lord Cashman (Lab)
My Lords, I welcome all the noble Baroness’s amendments. They seem sensible and the principle of equality is at the heart of them. I just wanted to point out that, given the equal marriage Act and the Civil Partnership Act, feasible as it is for a noble Baroness to find her footballer, it is equally feasible for a noble Lord, too.
Lord Kennedy of Southwark
My Lords, on the footballer point, I suggest that noble Lords should look at carefully at the teams, because certainly the teams that I and my noble friend Lord Hunt support probably would not give the sort of assets that people would be looking for.
The three amendments in this group in the name of the noble Baroness, Lady Deech, beginning with Amendment 23 in her name and that of the noble Lord, Lord Grantchester, again respond to concerns raised at Second Reading. I and others then raised the concern that the one-size-fits-all approach would not work in all cases, as there was no provision to take account of individual circumstances that could leave an individual in a much weaker position than would be reasonable. The amendments seek to address those concerns. In particular, Amendment 24 sets out a specific duty for the court to satisfy itself. This is a step in the right direction, but I am still left wondering whether we should go a little further to protect the weaker partner. However, the case for indefinite maintenance orders needs addressing and these amendments make progress in that respect.
Lord Faulks
My Lords, the amendments deal with Clause 5 and periodical payments. Amendment 23 concerns the power of the court to make orders for periodical payments and extends the duration of those permitted under the Bill from three years to five.
Amendment 24 inserts a new substantive provision into Clause 5(3)(c) and provides a mechanism for the court to extend the duration of a periodical order beyond the five-year maximum under the Bill in circumstances where there is no other means to make provision for a party to the marriage and that party would otherwise be likely to suffer serious financial hardship as a result.
Amendment 25 removes the provision in the Bill which would have provided that any party to the marriage at risk of suffering financial hardship should be awarded only such periodical payments or lump sum as is,
“reasonable to relieve that party of such hardship over a period of three years or such shorter period as the court considers reasonable”.
The noble Baroness has written to me to say that she has listened to the Government’s concerns—as indeed she has said today—that divorcees need sufficient time to adjust to their new circumstances and should not find themselves on benefits because of a lack of maintenance, as it was sometimes referred to.
The proposed amendments would go some way to address concerns held by the Government about the real possibility of hardship, with an economically weaker party to the marriage being forced to live on benefits. That risk needs to be balanced against the understandable desire on the part of many parties to a marriage for a clean break in the event of divorce. We continue to have reservations about the protections under the Bill for ensuring that an economically weaker party to a marriage can successfully complete the transition to financial independence, but we entirely accept the concern that has been well expressed about continuous and over-lengthy reliance on periodical payments, whether it is from footballers or Members of your Lordships’ House.
Baroness Deech
House of Lords (Expulsion and Suspension) Bill [HL]
(10 years ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Baroness Hayman
“( ) Standing Orders under subsection (1) may only make provision in respect of conduct by a member which takes place after the coming into force of this Act.”
Baroness Hayman
My Lords, I hope that I will not have to detain the Committee at great length on this amendment or on the subsequent amendment, because, at Second Reading, I was enormously encouraged by the widespread support for the aims of this Bill that came from all sections of the House. I was encouraged, too, by the words of the Minister in his offer to discuss issues arising from the Bill. In Pollyanna mode, I decided that not having a settled view was a good thing and that we could perhaps move forward to a point where the Government had a settled view that this was a small but important measure that they would be able to support.
As I have said, this is a simple Bill; it is an enabling Bill; and no major concerns were raised at Second Reading. I think that Members of the House recognised that this was not a Bill about composition or reform of your Lordships’ House, although many people would have wished that it were so, but that it was dealing with a limited but very important issue, which was to ensure that the House had available to it, if the circumstances arose in which they were needed, sanctions and disciplinary measures that the public would expect us to have in those circumstances and which I think there is general agreement that we do not have at the moment.
My conversations have been mainly about the technical issues that arose from the Bill—that is Amendment 2, which we will come to in a moment—but also about whether there was a way in which we could do two things. The first was to clarify in the Bill that this is a Bill about conduct, not about composition. The other was to address the point raised in the debate: to ensure that no injustice should be done in respect of any Member of your Lordships’ House.
As I have said before, this is an enabling Bill, and it will be for the House to draw up Standing Orders to ensure that the powers that it has been given by the statute are appropriately, fairly and properly implemented and that the processes and procedures available in such circumstances should be of the highest standard. In proposing the amendment, I am happy to include one thing in the Bill: the issue of retrospectivity. The amendment makes it crystal clear that sanctions that came to pass because of Standing Orders made under the Bill may be made only in respect of,
“conduct by a member which takes place after the coming into force of this Act”.
Given what I have said about the amendment clarifying in the Bill that it is not intended in any way to be a retrospective measure but is about putting our House in order in future, it is profoundly to be hoped, as many noble Lords said at Second Reading, that these serious disciplinary measures will not be needed because conduct will not occur that calls them into action. However, forewarned is forearmed and, as I said at Second Reading, I believe that we have a dangerous lacuna in our disciplinary proceedings and the Bill sets out to fill it and protect the House in those circumstances. I beg to move.
Lord Brabazon of Tara (Con)
I very much support the amendment, and apologise that I was unable to be in the House for Second Reading, but I also support the Bill. As some of your Lordships may recall, I was chairman of the Privileges Committee during the saga of the first suspensions to take place in the modern era. They were not as simple as all that, because a number of people thought that we should not have been able to suspend noble Lords from the service of the House. We found that we were, but we also found that we were unable to suspend noble Lords beyond the length of a Parliament. In other words, if someone was suspended today, they could be suspended for only five or six months or so, whereas if someone was suspended on 1 June, they could be suspended for five years. The press and the public were rightly unable to understand why we did not have the power to suspend for longer or, indeed, to expel. The Bill appears to deal with that matter extremely well, and I very much support it and the amendment.
Lord Cormack (Con)
I want briefly to add my support. The noble Baroness, Lady Hayman, is a leading member of the Campaign for an Effective Second Chamber, which includes Members from all parts of the House and of another place. We see the Bill as the logical extension of the Bill taken through the House of Commons last year by Mr Dan Byles and through this place by my noble friend Lord Steel of Aikwood, who has done so much in this field. During Second Reading, the word housekeeping was slightly disparaged. The Bill is extremely important, dealing with a vital subject, but it is quite literally about keeping the House in the best possible sense.
We are all grateful to the noble Baroness for, at this late stage in the Parliament, seeking to introduce a very short, precise and particular measure, which can certainly pass in the little time left available in this Parliament, given the good will and support of the Government. I was heartened, as was the noble Baroness, by what the Minister said at the end of Second Reading and by what I have heard since, and I very much hope that the Minister will be able not only to accept the spirit of the amendment but indicate that the Bill can have a fair wind. It is in the best interests of your Lordships’ House that this House should be kept in the best possible way, and the Bill enables us to move in that direction.
Baroness Flather (CB)
My Lords, I am totally in favour of this power being given to us. When we had the latest expulsions, the amount of flak this House received from the public was amazing. Everywhere I went, people were saying to me, “You are no different to the Commons. You are a cheat. Everybody cheats in the House of Lords”. It is very important that we can show that we will not allow people who cheat on their expenses to remain in this House. Anybody who has been found to be cheating should have to leave the House, because unless we do that, we will never recoup our reputation and position in the public’s mind. In any other place where anyone else works, they would never get away with the behaviour of some noble Lords. They would never be able to keep their jobs and stay on, so why should we not do the same?
I utterly support the Bill. We need these powers to protect all of us who do not cheat or behave badly, because one or two people can make all of us look bad. I hope that we can get on with this and that the Bill passes.
Lord Finkelstein (Con)
My Lords, the last thing I would want to do is delay the Bill in any way. I was shocked recently to discover that this proposal has been debated since the 19th century without being passed. Of course the principle is absolutely right, but I just question whether Amendment 1 is really a very good idea. We talked just now about expenses. Obviously, if we pass the amendment, that conduct, which would have taken place before the Bill came into force, may only be exposed after it came into force. The amendment would make it impossible to deal with that conduct. In other words, the amendment makes it difficult to deal with some of the worst conduct. To use an entirely hypothetical example, if someone committed perjury in a libel case and it took four years for that perjury to be revealed, in the course of which the Bill was passed, the conduct would no longer fall under the Bill. I wonder whether the amendment is quite what we want.
Lord Hunt of Kings Heath (Lab)
My Lords, the Opposition fully support the noble Baroness in her endeavours. The noble Lord, Lord Finkelstein, raised an interesting point to which the noble Baroness will no doubt respond. There is time between now and Report if clarification is required. I take his point.
The Bill can be fairly assured of passage through your Lordships’ House. The question is, when it gets to the Commons, what help will the Government give it? Without government help, I suspect that it will be very difficult for the Bill to pass, so it is right for me to press the Minister on what the Government’s attitude will be. At Second Reading, the noble Lord, Lord Wallace, helpfully said, as the noble Baroness reminded the House, that the Government have no settled view on the Bill at present. He kindly said that he would take back the speeches and consider with colleagues what response the Government could make. I hope that today he will be able to tell us that the Government are prepared to give this a fair wind in the other place. The other place does not have much work to do; the Government have sent MPs home. They now do Mondays to Wednesdays, so there is plenty of time for the Commons to consider this if the Government so wish.
There is an appetite in this House for sensible change. Discussions are taking place about the noble Baroness’s Bill and other noble Lords are discussing the issue of retirements, which we are going to have to face up to. Yet more noble Lords are discussing improving the governance of the House. I hope that the Government will allow for these discussions to take place and that we can have some more general debates about the issue of retirement. I think that we could reach a consensus on retirements in your Lordships’ House. The Minister is looking at me but there is an overwhelming appetite among noble Lords all around the House to sort this out. We have had the remarkable example of the Lord Speaker making a statement some months ago, giving notice of her intent to leave the House at a certain time. That was a marvellous example. Why are the Government not allowing the House to come to a sensible view on these matters?
The Minister may say that it is because substantive reform is just around the corner, and he may quote me as having said that in the past. It is difficult to assume who is going to win the next election, but let us assume that we have a Government after the next election, after some time and of some sort. Let us assume that they set up some kind of review—a convention or whatever—to come forward with proposals on substantive reform. I would say that the first opportunity of that coming into practice would not be before 2020, if we are realistic.
Lord Cormack
I am grateful to the noble Lord, whom I am tempted to call my noble friend on this occasion, as on others, for giving way. Does he not agree that it would be entirely feasible for the Government to set up a Select Committee of this House, with a strict timetable to report back by the end of January or in early February on the issues to which he was referring? I am quite confident, from my experience in the Campaign for an Effective Second Chamber, that consensus could be reached, and reached amicably.
Lord Hunt of Kings Heath
I very much agree with that. That is a very sensible approach and I am sure that consensus could be reached. The point I was making is on the argument that we should not do this because substantive reform is just around the corner. As I said, even if we agreed and a Bill went through and was approved by both Houses, it would be very unlikely to be implemented before 2020. So for at least five years ahead, we will be working under the current arrangements. The argument for sensible change—
Lord Hughes of Woodside (Lab)
I am slightly confused. I thought that this Bill was about dealing with people who transgressed the behaviour expected in this House. I appreciate that my noble friend is anxious to pursue his agenda but he knows perfectly well that consensus on reform of this House can proceed only on the basis of its powers compared to the House of Commons. Until that is satisfied, all the discussion in the world will get nowhere and he should not waste his time on it.
Lord Hunt of Kings Heath
With the greatest of respect—and I have great respect for my noble friend—I think that he has missed the point. I agree that substantive reform of the Lords will not take place until the relationship between this House and the other place is fully resolved. I believe that conventions will need to be codified in an Act of Parliament to have any chance whatever of there being a relationship between two elected Houses, if we are to have two elected Houses. Other noble Lords will disagree but I say to my noble friend that the argument that the Government have deployed on a number of occasions is that we cannot agree to sensible, incremental measures because we are committed to a fully elected second Chamber. That seems to be the argument that essentially comes out, certainly from the Minister and his party. My point is that even if we were to reach consensus and a reform Bill went through both Houses, it would be some years before it could actually be put into practice.
In the mean time, we still want a second Chamber to be as effective as possible. The way we are going, the issue about numbers is becoming so serious that we are running into a real problem of credibility. That is why I hope that the Minister will be very positive on this Bill but that he will also reflect on what his noble friend has said about allowing the House to discuss these other matters and come to a view very quickly, which I believe could be done.
Lord Wallace of Saltaire (LD)
My Lords, I hesitate to open up a wider debate about long-term Lords reform. We all know that we are already into substantial discussions about constitutional reform of this multinational state. I suspect that after the next election and, as the noble Lord, Lord Hunt, just said, with whatever shape of government should emerge from it, the future of this House will be caught up in those discussions. Two of the three parties are already committed to a constitutional convention, so there are a range of things—
Lord Hunt of Kings Heath
I am grateful to the noble Lord for giving way. I am sure he is right but does he also accept that it will be some years before any change can take place? Therefore, the argument that the House should be given a fair wind by the Government to make some incremental, sensible change is overwhelming.
Lord Wallace of Saltaire
The noble Lord and I will discuss, off the Floor, the question of how easy it will be to get consensus on the principle of retirement. I will tell him about some of the conversations I have had with Members of his own Benches about this over the past two years, some of which have been extremely vigorous.
Meanwhile, we are dealing with the Committee stage of today’s Bill, which, as the noble Baroness, Lady Hayman, rightly pointed out, is concerned with the conduct of the House. It has a limited and specific purpose and is concerned with the reputation of Parliament as a whole. We welcome that. The Bill is also concerned with rebuilding public trust in our political institutions and, as she made clear, is intended to give the House precautionary powers—powers which are intended to be available but to be rarely, and, one hopes, never, used. We recognise that and the Government also recognise the sentiment around the House on the Bill. We are very happy to work with the noble Baroness to ensure that the amendments are tweaked into a form that would suit.
We understand the spirit of the amendments but there are some issues about the exact definition, which we need to clarify. The noble Lord, Lord Finkelstein, raised one example: what do we do if we become aware of past conduct which was egregious but was not previously known? What do we do about past conduct, the effects of which are continuing? The issues of retrospectivity are complicated in this regard and the House will also need to be concerned that we currently have an inherent power of suspension, which may or may not be used with retrospective regard to past conduct. If we were to pass this, we would be limiting the power of suspension that the House currently has. What I can do on behalf of the Government is to say that we would be very happy for Cabinet Office officials and lawyers to discuss between this stage of the Bill and the next, with the noble Baroness and others, how we might reshape these amendments to put them into a reasonable form.
The Government are giving the Bill a fair wind in this House. How far we will be able to assist it in the other place is a matter which the Government do not yet need to address and have not yet fully addressed. All Members of this Chamber will know of the complicated internal procedures that the Government need to go through. It will be tight to get the Bill through the other House, given the queue of Private Members’ Bills before the next election—although I take the comment from the noble Lord, Lord Hunt, that some of them are not entirely overworked at the moment—but we need not address that issue definitively at present.
For the moment, I am very happy to say that the Government will work with the noble Baroness to revise the amendment into a form that would suit the purposes that are intended, and that we have thought through some of the complications about the principle of retrospection, which is a very delicate and important one in the issue of conduct.
Baroness Hayman
My Lords, I am very grateful to everyone who has spoken for their support for the general principle of the Bill and for their recognition that, although we quickly get on to wider issues when any of us in your Lordships’ House talks about the House itself, this is not a House of Lords reform Bill but a House of Lords disciplinary Bill.
I was particularly heartened by the Minister’s words because, as the noble Lord, Lord Finkelstein, will not be surprised to hear, some of the issues that he raised have also occurred to me. The issue of retrospectivity is one on which the House has very strong views. We have lost most of the lawyers who were taking part in the preceding business, but if they were here they would remind us of some recent examples of the fact that you cannot bring in sanctions that would be current today for offences that occurred in the past. We are talking basically about a sanctions regime. Equally, I do not think that anyone in the House would think it appropriate for there to be double jeopardy and, where someone had had disciplinary proceedings against them, been suspended and then had come back, for that to be reviewed. However, I take the point of the noble Lord, Lord Finkelstein, and the Minister that there are some issues where conduct takes place before disciplinary proceedings, and that the interaction of that with the Bill is an important area.
I hope that the conversations we have will be fruitful and that the fair wind that the Government have given to the Bill in this House will enable us not only to pass these amendments today but to return to them on Report so that they can be improved appropriately. I should record now that I have been immensely grateful to the Leader of the House, the Minister and officials within the House for their support and help thus far in the Bill. They will understand when I pocket that help and support and ask for more, because I believe that we can get the Bill into perfect shape quite quickly in this House and that a fair wind transferred down the corridor could enable us to get it on to the statute book. That would be good not just for this House but for Parliament as a whole. I beg to move.
Baroness Hayman
Baroness Hayman
I suspect that we will not have the same level of debate on this technical amendment. It was pointed out to me that it would be helpful, in spelling out the consequences of expulsion under the Bill that are to mirror those under the “Byles Bill”—the House of Lords Reform Act 2014—if I referred not simply to Section 4 of that Act but also to subsections of that Act. I beg to move.
Lord Wallace of Saltaire
My Lords, here again the Government are sympathetic to the principle, but there are some technical issues about how the Bill refers to the 2014 Act and how one relates to the other. Again, the Government would be very glad to talk to the noble Baroness between Committee and Report to sort them out and perhaps come back with a different amendment on Report.
I read the latest Code of Conduct again this morning, thinking that we need to be sure what we are on about. One of the issues that perhaps we need to discuss informally off the Floor is how far this measure is intended to refer only to conduct that is mentioned in the Code of Conduct or to egregious conduct of other sorts conducted by Members of this House. However, that is a question that we need not have in the Bill itself, but it is certainly a question that the Committee for Privileges and Conduct and others will need to consider at a later stage. With the reassurance that we will be very happy to discuss how we remodel this amendment between now and Report, I hope that the noble Baroness is happy with the Government’s response.
Baroness Hayman
My Lords, one thing I would never claim as one of my core skills is parliamentary draftsmanship. Therefore, I am not just happy but very grateful to have the discussions that the Minister suggests.
I agree with the Minister that the heavy lifting about getting this right has to be done within the House, with the Committee for Privileges and Conduct looking at the code of conduct and Standing Orders and making sure that we have the appropriate procedures. This is an enabling Bill to allow us to get on and do that meticulous and careful work under its auspices.
Equality Act 2010 (Amendment) Bill [HL]
Lord Blencathra (Con)
My Lords, this Bill is officially called the Equality Act (Amendment) Bill, but that is rather a boring title. I prefer to call it the “Six-Inch Rule Bill” since it simply imposes a duty on all occupiers of public buildings to install a ramp if the entrance to the premises has a step of six inches or less.
Noble Lords may ask why this is necessary since we have the all-singing, all-dancing Equality Act 2010, which runs to 218 sections and 28 schedules and covers all forms of discrimination, including facilitating access to public buildings for disabled people. Indeed, Section 20 of the Equality Act imposes a duty on occupiers of public buildings,
“to take such steps as … is reasonable”,
to remove any physical features of the building that disadvantage disabled people. That wording seemed sensible and should cover all possible situations. It is clever wording and no doubt Harriet Harman MP and the officials thought that by setting down that general principle, the Act would stand the test of time and not require the regular amendments it would need if they had phrased it in more specific language.
However well intentioned Section 20 and the related Schedules 4, 5 and 21 were, the duty to make reasonable adjustments is simply not being implemented on the ground. There are tens of thousands of entrances to public buildings with a step of less than six inches and nothing is being done to grant wheelchair access to them. Clause 1(2) of my Bill states that if the entrance step is of six inches or less, it is cheap and easy to remove the step or make a ramp. If occupiers do not remove or adapt the step of six inches or less, they would fail in their duty under the Act,
“to take such steps as … is reasonable”.
Subsection (3) introduces a duty to introduce ramps for steps of up to 12 inches to be introduced at a later date, but more on that later.
What is the justification for my assertion that no reasonable steps are being taken to enforce the provision,
“to take such steps as … is reasonable”,
to remove any physical feature of the building that disadvantages disabled people? The evidence for my assertion is available for all to see in some stunning examples just a few hundred yards from your Lordships’ House. If noble Lords were to take a short walk down Victoria Street as far as the Army and Navy Stores—now House of Fraser—turn left into Horseferry Road and left again through that wonderful little market street Strutton Ground, they would see more than 40 examples. The vast majority of big chain stores and shops on Victoria Street have level access from the pavement or a lip of about an inch at most. Of course, new-build shops nearly all have level access. However, there are nine shops on Victoria Street with a step of six inches or less. In Horseferry Road, there are about a dozen shops or pubs with a step of six inches or less, and Strutton Ground has 21 such premises. I hasten to add that this is no criticism of Westminster Council, which is particularly good at providing dropped kerbs for wheelchair users; nor is it any special criticism of the shops in Strutton Ground. I mention the shops in this location because they are right on our doorstep 300 yards away, but I could easily take any street in any town or city in this country and find tens of thousands of examples of the same thing.
What is particularly irritating—to me, at any rate—is that many shops have a step of about 2 inches, the thickness of the Companion, and it would take less than £10-worth of concrete to put a ramp in front of them. There are even some shops sharing a double doorway, where one has put in a little concrete ramp and the other right next to it has done nothing and left the step.
What is the point of this? Wheelchairs have little front wheels and if you hit a step of 2 inches, it is the equivalent of a motorist hitting head-on a pavement of eight inches. It is not something you do twice, not deliberately at any rate. I have found that many shopkeepers in those streets and in Pimlico are very kind and offer to serve me out on the pavement. However, I have a principle that if they cannot be bothered to make a slight, low-cost adjustment to let me into their shop, I am blowed if I am going to give them my business, and I will go and buy my sandwich somewhere else. One restaurant, which is very close to the Home Office, suggested that if I came round the back, they could let me in through the kitchen. I thought that being asked to go round the back door last happened in Alabama in the 1960s. Would any other group covered by the Equality Act tolerate the suggestion of going round the back to be served?
I have therefore concluded that an amendment is necessary to deal with the easiest and cheapest problem to solve—steps of less than six inches—and give people in wheelchairs access to tens of thousands of buildings that we cannot get into at present. I am not asking owners of buildings with lots of steps to make changes at a cost of £20,000, nor am I asking listed buildings to wreck their appearance by building ramps instead of steps. I think that all of us in wheelchairs accept that when some of our greatest buildings were erected, wheelchair ramps were not in the architects’ design manuals. For many ancient buildings, it is enormously expensive now to install wheelchair ramps or lifts. If we cannot do it in this House, it seems a bit hypocritical to demand it of others. That is why I am focusing on the easiest and cheapest solutions.
I have checked all this out and have bought some ramps for my personal use; one can get sophisticated aluminium or fibreglass ramps which are suitable for steps of six inches or less and cost less than £100. I ask those of your Lordships who only do metric to look at the steps in the gangways in your Lordships’ House. I have measured them, and the bottom steps are four and a half inches high; the next ones are five and a half inches; then they alternate to four and a half again. I am not suggesting that we install ramps here; I am merely using them to illustrate what a height of six inches is. It is neither rocket science nor expensive to provide ramps that would grant access to buildings outside this place with steps of six inches or less. However, I think that half the places we looked at in those streets I mentioned could solve the access problem with about £10-worth of concrete. I calculate that, if my six-inch rule Bill became law, we could get access to more than 90% of those 42 shops in Horseferry Road, Victoria Street and Strutton Ground. If replicated nationally, this small step for man would be a giant leap for mankind, or at least for wheelchair users—to paraphrase Neil Armstrong.
While there are many buildings with steps higher than six inches, and where it would still be reasonable to make the adjustments I suggest, I do not want cost to be used as an excuse for not doing it. I do not think that anyone with a shop or a pub can complain that a cost of £100 is an unreasonable burden, and I hope that the Department for Business, Innovation and Skills will agree with that in any impact assessment it carries out.
I realise that my Bill will probably not become law in this Session, and that if it were to make progress in Committee, I would want to amend it. Clause 1(3) on tackling steps of 12 inches is probably a step too far. I would like to replace that with a regulation-making power for the Minister to be able to legislate for steps higher than six inches in a manner and timescale that would not put a further burden on small businesses. Clause 1(4) makes it clear that my Bill would not apply to buildings with more than one step if the total combined height of the steps was greater than six inches. Thus, if they had two steps of three inches, it would apply, but if they had two steps of, say, three and four inches, making seven inches in total, it would not apply. I think it would be reasonable to do that, but I put it in the Bill to reassure businesses that they would not suffer excessive cost and so they could not complain about the burden placed on them and use it as an excuse to block this legislation.
I am very grateful to the Minister and her officials for accompanying me yesterday on a cold, chilly afternoon to look at the premises in Strutton Ground and get a first-hand look at the problems that my Bill seeks to address. I do not wish to put words in her mouth, but I think we all concluded that in many cases the solutions were cheap and easy to bring about. Indeed, some of the shopkeepers had done it themselves, putting down a little concrete to enable wheelchairs to get in easily.
As I said at the beginning, theoretically, the wording in the Equality Act on disabled access is excellent, but I submit that it has failed and is failing in reality. I also get the impression that disability is very low down the agenda of the Equalities Office. Of the hundreds of announcements made by the office over the whole of 2013-14, I could find only two related to disability—I apologise if I got that wrong. One was that three interns had been appointed to work with parliamentarians, and another that up to 60 people had applied for grants to get involved in politics. Those are no doubt very good things, if they can actually get into the polling stations, but there are supposed to be 1.2 million wheelchair users who cannot get into public buildings at the moment—although I think that that estimate, which I got from the web, is high; there are probably about 800,000. However, that is still a pretty large number of people. I suggest to the Minister and the department that they would have a big win on their hands if they adopted the proposals in my Bill.
I am afraid to say that the equality commission seems to be doing nothing to enforce Section 20, and district councils seem to be worried about the cost of judicial review if some organisations were to challenge them if they enforced Section 20 on the basis that their interpretation of it is not reasonable. Therefore, I have concluded that a specific and objective measurement is the only way in which to make progress. It removes the need to determine whether the adjustment that I suggest in my Bill is reasonable.
I have gone through the Act carefully and looked at all the regulatory powers, but I cannot see any that would permit the Minister to make regulations addressing the specific and practical points in my Bill. There may be, but I could not find them. I am willing to accept that a possibly better solution than my Bill may be a new regulatory power that would permit the Minister to specify, in addition to the general duty to take reasonable steps, that certain practical things would be regarded as a breach of the duty and should be remedied. That power could be used for wheelchair access, as in my Bill, or specific other measures that would help blind, partially sighted, deaf or other people with disabilities who also need a practical remedy.
I hope that I can get the support of your Lordships’ House, at least for the concept of what I aim to achieve. I acknowledge that my Bill requires amending and input from noble Lords and noble Baronesses who have longer experience of wheelchair use than I have. However, I am convinced that the concept of my Bill is right. No real progress on getting access to public buildings will be made unless we have the Bill or a regulation that brings about the same effect. I beg to move.
Baroness Thomas of Winchester (LD)
My Lords, I am very pleased to support my noble friend’s Bill, which is a timely reminder that disabled access to all kinds of premises, particularly shops, is not done and dusted. This is what Martin Affleck, an architect specialising in access, told me recently:
“After the initial flurry of implementing the Disability Discrimination Act between 1996 and 2004, many service providers, including shop keepers of small premises, have stopped bothering and there is very little pressure to make improvements other than when Building Regulation approval is sought for some other reason”.
I urge the Government to put their weight behind this modest Bill—modest, but one that will be very significant for those of us with mobility problems. Many of us want to support smaller, independent shops for all kinds of things, including specialist food shops, greengrocers, clothes shops and many others, but all too often there is the barrier of a step or two, making it impossible for wheelchair users or even walker users, like me, to access these places. Nor, often, is there a rail, meaning that even those with sticks feel unsafe.
The excuses are legion, the chief one being, “The landlord won’t let us”, or, “This is a listed building”. And the more that one shop does nothing, the more that the others do not feel that they should either—so nothing happens, and disabled people have to find much of what they want in supermarkets with disabled parking spaces in their car parks and disabled lavatories inside, or in accessible high street chain stores. But why should disabled people be excluded from niche shopping or supporting their local shops? I used to buy fruit and vegetables from a local shop which had one steep step up. I had to stand on the pavement and trust the greengrocer to get everything for me, but it was not satisfactory. There is a row of shops quite near where I live, running alongside Wandsworth Common, where little ramps have, in places, been installed. This immediately gives the disabled shopper a warm feeling that their custom is welcomed.
My noble friend Lord Blencathra is very kind to those in charge of listed buildings. I do not feel quite so kind. Are buildings really more important than people? Yes, of course there are ways of making premises in listed buildings accessible—as I believe my noble friend Lady Brinton will say. Of course I understand that some buildings will have to remain for ever out of reach for those of us with impaired mobility, but for far too long owners have just had to utter the words “listed building” for that to be the end of the matter.
At this point I must mention an organisation that I have only recently come across called the Access Association. It is a national network of individuals, including many access officers, who say that they are,
“passionate about access and inclusive design”.
Perhaps my noble friend will agree to meet the association to see whether it can help to take things forward. After all, the design of a ramp, even a small one, can be quite a tricky business, and many of the people in this admirable organisation are professionals and know their business. Enforcement is also an important question that it can help with.
While I am on my feet, and on the subject of the accessibility of shops, I must say something about dropped kerbs—that is, the lowering of kerbs on either side of a road junction to allow a wheelchair, pushchair or someone with a walker to cross safely. Even where there are dropped kerbs, many local authorities do precious little to maintain them, with the result that some of them are quite dangerous. Sometimes the design was not right in the first place, as many are simply too steep. Some have been damaged by use and not repaired. I urge local authorities to check on all their dropped kerbs to make sure that they are fit for use. The population, as we all know, is getting older and more disabled, so this problem will grow if not addressed regularly.
The House will be glad to know that I will not raise at this point another of my favourite topics when talking about the high street and accessibility—that is, the design of disabled lavatories—but will leave that to another day. I wish my noble friend’s Bill well.
Baroness Flather (CB)
My Lords, I am not in a wheelchair, but my husband of very long standing is in a wheelchair. He got MS in 1983 and by the mid-1990s he had to start using a wheelchair. He now cannot stand and is in a wheelchair all the time. We have hoists at home to get him into bed or on to the loo. That is all right; we are all right at home and do anything that needs to be done. There is a two-inch lip to get out on to the patio, which we dealt with by putting a little wooden ramp down; it did not cost anything and he can go over it without wibbling and wobbling.
However, there is a big problem with many places. It can be even worse than just the shops; sometimes you do not need to shop but you like to eat out. Many of the restaurants do not provide access. As the noble Lord, Lord Blencathra, has said, you go in from the back. How many times he has gone in from the back —not just into restaurants but into government buildings and all sorts of places. Maybe it is exciting to see what goes on behind the front, but it is not what people expect. They expect nowadays to be treated like normal people because they are normal people. My husband has been a practising lawyer and sat as a judge. He is very old now but he is still doing a lot of work for the Ministry of Justice. People’s brains are working absolutely perfectly and they want to enjoy some of the facilities that everybody else takes for granted. Anything that can be done to help make that happen has to be right and proper. However, I am sorry to say that these things have not been done. As the noble Lord, Lord Blencathra, said, disabled people are just dumped.
I went with my husband to a fusion-food restaurant which is part of the EAT franchise. We could not get in and the staff were quite rude to my husband, so we wrote to both the restaurant manager and to EAT but have received no reply. I do not know what we are supposed to do when people take no notice of what disabled people say to them about the treatment that they have received. Not to gain access to premises and to then be subjected to rudeness is too much for most people. Some of the restaurants that we visit regularly now have ramps that are put down for disabled people. If there is a small step, you do not have to construct a permanent ramp; you just bring out a ramp and put it on the step. That happens in many places now. You just let them know that you are coming and they have the ramp ready. Some premises are not prepared to do even that but ramps are not expensive and it is something that we should all be able to expect. Therefore, I totally support the Bill.
I support other measures, such as disabled loos. However, disabled people are never asked what should be in these loos. All disabled people are considered to need one kind of loo, but disabled people have differing needs and different people with at least two or three different disabilities should be asked whether disabled loos work for them. That is not done.
Another problem is that a hotel room for disabled people may contain a double bed. I can tell noble Lords from personal experience that it is almost impossible to sleep with a disabled man. I do not know how the noble Lord’s wife manages but I certainly cannot manage with my husband. It is very awkward for both of you, because my husband needs to be moved around or he moves around. It is so silly that people do not take into account disabled people’s actual needs. They say, “This room is suitable for disabled people”, but there is no room to get round the double bed in a wheelchair, for example. I do not know when we will start to think properly about the needs of the disabled, but any such start on that would be welcome.
Baroness Brinton (LD)
My Lords, I welcome my noble friend Lord Blencathra’s Bill to amend the Equality Act and his eloquent explanation of why it is necessary. Access for those with disabilities, principally but not only those in wheelchairs, is not just nice to have, it is essential if the Equality Act is to mean anything today. People offering services of any kind or running a public building should make adaptations wherever possible, as their responsibilities under the Act are clear. However, the policing of adaptations is often poor.
My noble friend is too kind. I do not want just six inches; I think that 12 inches is an absolute minimum because technology has changed. It is possible to buy properly constructed sturdy ramps in a range of sizes for permanent installation or, where that is impossible, portable ramps for staff to bring out. I cannot access a large number of shops. Therefore, there are a large number of shops where I will not spend my money. Others have spoken of restaurants. I despair of some restaurants, especially those where staff think that they are accessible until you turn up and the penny drops.
However, I do not want to be entirely negative. There are some very good examples of small shops in listed areas. One example is Bravissimo in Covent Garden. No permanent ramp is possible because the shop is right on the corner of Covent Garden, with a tiny pavement in front of it. What is really noticeable about Bravissimo is that all its staff are well trained in helping women with disabilities, and it shows. That extends beyond having the obvious accessible bell and responding to it, putting the ramp down and not serving one behind a high till, which too many shops just forget about, to include help with selecting items to try on, taking them down from higher hangers and to fitting too. You know that this is an organisation that really cares, and that is why they get my business. Sadly, that contrasts with the poor examples—organisations that do not provide or highlight their arrangements. How often have people in wheelchairs turned up to discover that there is no bell and no sign to the disabled access around the back.
Earlier this month, I booked into a small hotel in Ebury Street. After checking that it was accessible when the room was booked, I rang again on the day to let the hotel know that I would be arriving very late and to check that the night porter would have access to the ramp. I was assured that he would and that the hotel was fully accessible and had a proper disabled bedroom and wet room. It sounded good. I arrived in the taxi, which sped off. As the night porter came out, it was immediately apparent that the step, which was probably just under 12 inches high, was completely unsuitable. The ramp that arrived was for a sack barrow—far too steep. The staff kept insisting to me that the ramp was fine but two of them could not push the chair up the ramp, which I had said they would not be able to, and after 15 minutes they abandoned this. I was kept on the pavement in the cold at 1.30 am for 45 minutes while they tried to find a better ramp from another hotel, could not do so, and then tried to find me another hotel. To say I was unimpressed was an understatement.
The noble Baroness, Lady Flather, referred to disabled rooms in hotels. Premier Inns has a special line in disabled rooms. I have been offered accessible rooms previously and the bedrooms are fine. The rails around the toilet are fine. The shower over the bath is less impressive. When I mentioned this to one receptionist on the morning I was checking out, she said, “We provided a little platform at the end of the bath to help you slip in”. When I asked, “How do I get out?”, she looked rather perplexed.
For grade 1 listed buildings, not small just businesses, the poor examples are legion. A particular bugbear of mine is the glamorous London Marriott County Hall Hotel. I am afraid that I have no compunction in naming and shaming the wrong ones. The main entrance is a sweep of wonderful steps. The hotel always uses the excuse of being listed not to vary the front. I shall come on later to those hotels that do. I have been invited to dinner there on a couple of occasions, and the contortions to get in are Byzantine. You have to travel down the street on your own, wait outside the security entrance of the next organisation in County Hall and wait for the security guard to come from his tour of the building. Last December, it took well over half an hour on a very cold evening, making me late for the dinner I had been invited to. When he arrived, the stair lift up the steps was excellent. What was less good was the unlocking of a series of sets of doors between the hotel and other organisations in County Hall, one of which was encircled by the most enormous chains I have seen in a while. It began to feel like something out of Dracula, with chains and dark, poorly lit service corridors. By the time I finally arrived at the dinner, I felt extremely unwelcome. The organisation I was with will not use that hotel again. I wonder whether the hotel knows how damaging this is, not just to its reputation but to its bottom line.
There are ways of making adaptations even in these listed buildings. I excuse small enterprises from this but anyone who has seen the arrangements at the front door of the Institution of Civil Engineers in Great George Street, opposite the Treasury, knows that it can be done elegantly and practically. It can be viewed on YouTube, but for those that do not know, the white stone steps are divided by a balustrade. Half the steps elegantly retract underneath the building and a stair lift emerges from the cavity underneath. You are made to feel really welcome, whether you are in a wheelchair or find the steps too difficult if using a walking stick. Contrast that with two other buildings in its vicinity. The Institution of Mechanical Engineers on Birdcage Walk is, frankly, an insult to use. A scissor lift behind a steel door on the pavement takes you down to a door into a meeting room that is let out. I have been escorted through other people’s meetings. They have to get up and move themselves and their chairs away so that I can get through to use the accessible lift. Then there is 8-10 Great George Street, where the Liberal Democrats have their headquarters. The landlords provide access through a car lift into the basement behind the building, with two sets of industrial gates to get through on the ground floor and the basement. There is then a very narrow doorway access to the lift and security to get through before I even get to my party’s headquarters.
Technically, both those buildings comply with adaptations under the Equality Act, but they are not disabled friendly and they say a very large amount about the landlords’ attitudes towards people with disabilities. I have even been told, at the Institution of Mechanical Engineers, to wait, as the maintenance man was not free to take me down—just like a parcel.
The issue of inappropriate ramps is not just for fixed buildings. There is a real problem with taxi drivers who claim to drive accessible taxis, with the blue wheelchair sign in their windows. I need to make it clear that London, Glasgow and some other large cities that insist all Hackneys have a single ramp are not the problem; it is the many smaller cities and towns where taxi driers in accessible vehicles—including, I am afraid, older black cabs—have only to produce evidence of ramps: note the plural. It is possible to purchase cheap parallel track ramps that are not suitable for people in electric wheelchairs because the ridges are incompatible with the base and shape of electric wheelchairs. They are also often too flimsy and probably would not sustain the heavy weight of an electric wheelchair, some of which weigh 85 kilograms before the owner is in it.
I travel extensively, and I now dread waiting for an accessible taxi. Too often, even when I have asked for a single ramp for a wheelchair, the one that arrives has two. Both the driver and the customer are irritated, but the dispatcher at the firm does not care. At Watford Junction station, my local, where the drivers are as regular as I am, I am afraid to say that there are a handful who do not even lower their window to tell me that they have two ramps. They know my face and they hold two fingers up to me, from which I am meant to deduce that they are a two-ramp cab, not a one-ramp cab. I appreciate the Bill’s constraints and I understand that we must be realistic about achieving change, but I would love to see a condition for the licensing of accessible taxis that the driver should have a single ramp, and that it is tested at the same time as everything else to ensure that it works.
To return to the substance of my noble friend Lord Blencathra’s Bill, I support it and understand its limited scope, but I am reluctant to accept his new idea that we can do further things with regulation. I hope we might consider some minor amendments to it to provide a level playing field for those in wheelchairs trying to live an independent life. Frankly, hotels, restaurants, shops and offices can make life an absolute misery. A few small, compulsory, not expensive adaptations will not only help those with disabilities, but increase business for the public buildings supplying them. Something that benefits the bottom line should always be encouraged. Making people independent is beyond price.
Baroness Thornton (Lab)
My Lords, I congratulate the noble Lord on bringing the Bill forward. It is an exact model of a Private Member’s Bill: it addresses one issue and does so in very few clauses. I also congratulate the speakers in the debate. I was listening very careful to the noble Baroness, Lady Brinton, and her story about County Hall. I wondered whether she was going to end up in the aquarium or something when she spoke about all the doors that she went through.
It is important that we congratulate the institutions, buildings and businesses that get this right and that we name those who get it wrong. When I visited its headquarters recently I noted that the RIBA has remodelled its front and its steps for disabled access. If the RIBA can do it, anybody should be able to do it.
I was interested when the noble Lord talked about the 2010 Act because I was one of the Equalities Ministers responsible for helping to take that legislation through your Lordships’ House. I very well remember the discussions that took place around Clause 20 and the negotiation that took place across the House about how tight or otherwise it should be. At the time, the noble Lord, Lord Low, tried to make amendments to the Bill which were not dissimilar to this amendment. However, because negotiations were going on and it was at the end of a Parliament, I am afraid that not all the parties in the House could agree to them. However, at that time everybody knew and accepted that the Act would need to be addressed from time to time to see how it worked or did not work and what adjustments might need to be made. It is entirely sensible that we are reaching that point.
I apologise to the noble Lord for not going on his trip to Strutton Ground yesterday. As I said in my note to him, it was one of those days when I could not manage to get out of the House to do something as interesting as that.
I grew up with somebody in a wheelchair. My grandfather had been blown up in the Second World War and was a paraplegic. He died when I was about 20. My parents got married in 1952 and, as the noble Lord will know, wheelchairs then were very large and extremely heavy. My parents told me that he had to be carried in his wheelchair up two flights of stairs to attend their wedding. There was absolutely no way that the register office in Dewsbury would have any access whatever for someone in a wheelchair.
My mother was in a wheelchair for a lot of the last year or so of her life. Although she was slightly mobile, she needed a wheelchair when we went out. As the noble Lord will know, in Yorkshire we have a lot of hills. Her favourite garden centre had disabled access, and it was very good and very accessible, except that the car park was on a steep slope. Getting her out of the car, into the wheelchair and into the garden centre without her rolling down the hill to Haworth was quite a challenge. Therefore, I am absolutely familiar and completely in sympathy with the noble Lord’s wishes and with the Bill. I am very pleased to hear that he seems to have anticipated some of the issues that might arise from the issue of six inches and 12 inches.
I think that this is a good time to ask questions of the Government about the enforcement of Section 20. As the noble Lord clearly did, I looked at what was being said by the EHRC about disabled access and adjustments for disabled people. Because my research was done yesterday, on the Equality and Human Rights Commission’s website I found briefing dated 11 November about the adjustments for disabled people. It basically reiterates what is in the Bill, which is that Section 20 is anticipatory. In other words, it anticipates that adjustments should be made whether they are asked for or not. That is rather important, and I remember the debates about that. The briefing says that an organisation should not wait,
“until a disabled person wants to use its services, but must think in advance (and on an ongoing basis) about what disabled people with a range of impairments might reasonably need, such as people who have a visual impairment, a hearing impairment, a mobility impairment or a learning disability”.
The question of what is reasonable has now changed. The noble Lord is suggesting that it is reasonable that businesses should take steps to make these adjustments, and I think that that is entirely right.
I shall not prolong the debate, because other speakers have made the case much better than I can, having spoken from their personal experience. I wish the Bill well and look forward to the Minister’s response.
Baroness Jolly (LD)
My Lords, I, too, take the opportunity to congratulate my noble friend Lord Blencathra on succeeding in getting his Bill read a second time in this House. It has given the House an opportunity to consider a very important legislative protection provided to disabled people in the Equality Act 2010.
My noble friend’s Bill seeks to amend the wording of the duty set out in Section 20 of the Act, which imposes a requirement on specified people to make reasonable adjustments for those with a disability. This ensures that those who meet the Act’s definition of a disabled person are not put at a disadvantage compared with those who are not disabled.
The Bill would require service providers and others to provide ramps for wheelchair users where there is a single step at the entrance of their building. Initially, this would apply to steps of less than six inches in height, with a longer period to allow compliance where the step is between six and 12 inches. Under the Bill, this would be a legal requirement irrespective of the physical location of the building.
I have a good deal of sympathy for my noble friend and the frustration that he feels in being unable to enter some shops and other premises. Like the noble Baroness opposite, I myself experience the same feelings when caring for my mother. She is a wheelchair user. I have to push her around on Cornish granite cobbles. The two of us—her in the wheelchair and me pushing—frequently encounter the same sort of obstacles and difficulties that my noble friend has vividly described, and of the sort that he pointed out to me when we made our tour of Strutton Ground in Westminster yesterday.
The reasonable duty is a cornerstone of the protection offered to disabled people under the Equality Act 2010. It has a wide application—in the fields of employment, service provision and the exercise of public functions—and it applies to both the public and private sectors. The adjustment duty as it applies to the provision of goods, facilities and services is anticipatory, as we have already said. The rationale for that is that while a service provider’s relationship with a customer is often transitory, it is reasonable for the service provider to “anticipate” particular adjustments, which will prevent a disabled person from being put at a substantial disadvantage in comparison to a non-disabled person. The question of whether there has been a failure to comply with the duty therefore hinges on what is reasonable.
My noble friend and I did indeed see a number of premises yesterday where reasonable adjustments had been made simply and cheaply, as well as others where they could have been made but had not been; and yet others where they would not have been feasible, at least within any proportionate cost.
I entirely accept that the use of the adjective “reasonable” in the legislation recognises the need to strike a fair balance between the needs of disabled people and the interests of service providers. The Act therefore requires a service provider only to make adjustments that are reasonable in all the circumstances of particular situations. For example, if the cost of making the adjustment would put the service provider out of business, that clearly would not be reasonable.
I should also explain that building regulations control certain types of building work, principally the erection, extension and demolition of buildings and the provision or extension of certain services or fittings, so as to ensure that buildings meet certain standards of health, safety, welfare, convenience and sustainability. For buildings in England and Wales, Part M of the Building Regulations 2010 includes a requirement to ensure that reasonable provision is made for wheelchair users to gain access to buildings, including premises used as shops.
This is where we begin to encounter difficulties with the proposal for the automatic installation of ramps in my noble friend’s Bill. Clearly, for some existing premises giving out directly on to the street, there would be significant difficulties in finding even a fairly small area to construct a ramp. For some, it might create a potential hazard for pedestrians. Yesterday, we looked at the issue of dropped kerbs where there are bobbles in the pavement. The dropped kerbs are for disabled users and the bobbles are for blind people to know when they are approaching a road. Sometimes one part of the disabled community can be served and not the other, so there is a balance. Also, some buildings open directly on to a highway that belongs to a third party, and in such circumstances it would be impossible to provide a wheelchair access ramp without cutting back into the building’s entrance floor. In some cases that could be quite an expensive operation.
The existing provisions in the Act are deliberately worded so as not to specify what an individual with obligations under the Act should do. This wording allows for greater scope in considering how best to solve the particular problem being experienced by the disabled person. We have had examples of where workarounds could not possibly fit under the “best fit” description. Specifying the remedy to a particular problem in the Act will inevitably result in proposals to have other specific remedies spelt out in it or in future technical guidance. In practice, this could risk the Act becoming a series of technical specifications which might actually be easier for employers and service providers to circumvent than the “reasonable adjustment” duty. Under the Bill, many service providers are likely to assume that building a ramp of the sort proposed will now constitute fulfilment of the duty—end of; nothing further would be required. This would result in provisions that might well suit some disabled people but not others, so I hope that noble Lords will agree that rather than changing the law, it might be helpful if we consider ways of trying to make effective use of the existing law with the duty—it is quite a powerful one—that we currently have.
Ultimately, there is the option of bringing a case against a service provider if all else fails, although I fully acknowledge that this always has to be the last resort and that many disabled people may be deterred by the effort and cost. Yet Allen v RBS, Paulley v First Group plc and some cases involving other types of disability show that it can be done. It is against this background that the Government have doubts about the need for and, indeed, the feasibility of the noble Lord’s Bill. Even if some noble Lords may not accept that the current arrangements are ideal, I hope that they recognise that the physical location of some buildings would make it impossible for businesses to build ramp access, and indeed we did see a few like that yesterday. As such, this Bill would impose a duty that is impossible to comply with.
Let me assure noble Lords that the Government have a continued commitment to disabled people, and more specifically to our belief that every disabled person has the right to have an adjustment made for them if it is reasonable. What is in contention here is the best way of achieving that aim. The Government believe that the current system is both fair and balanced, and works in the main satisfactorily for disabled people, businesses and employers.
Baroness Flather
Forgive me, but I cannot agree that the law works in a fair way. It really does not. There are so many places where things could be done quite easily, but they are not done, and if you complain, they still do not do it. Can the Minister tell us how to get these things done?
Baroness Jolly
The noble Baroness makes a fair and very good point. My noble friend mentioned the Access Association. It may be that noble Lords need to work with such organisations. However, I take the point that taking someone to court is a bit excessive, although a certain amount of naming and shaming would do no harm. I would not mind betting that the PR organisations that deal with some of the organisations which have been named today will pick stuff up in Hansard tomorrow. Actually, that will be no bad thing.
Legislation does not stay the same for ever, and indeed changes were made from the Disability Discrimination Act 1995 to the Equality Act 2010. Like other recent statutes, the Equality Act will in turn be subject to post-legislative review. In this case it will cover the period 2010 to 2015; that is, the first five working years of the Act. Under the normal rules, we can expect the next Administration to publish, as the outcome of the review, a memorandum for the relevant Select Committee, which itself may choose to take forward aspects of the review or indeed its own conclusions on whether and how the legislation has worked relative to the stated aims of the Act. I realise that this does not offer any immediate solution to my noble friend’s concerns, but hope it will reassure him that the Government, and indeed Parliament, remain mindful of the sort of problem he has raised.
The Box has just given me an answer to the point made by the noble Baroness, Lady Flather, about what action a disabled person can take if appropriate adjustments are not made. They should first approach the service provider to discuss why they feel they cannot access the service or function in question, and discuss what adjustments they require. If, following discussion, the service provider fails or refuses to make a reasonable adjustment, the disabled person could take their custom elsewhere; alternatively, they might decide to bring a case of alleged disability discrimination before the civil courts. I can see from the noble Baroness’s face that that does not satisfy her.
For the present, however, the Government are unable to support my noble friend’s Bill for the reasons that I have set out to the House.
Lord Blencathra
My Lords, this has been a short but interesting debate. I will come to the Minister’s response at the end of my remarks but I am slightly disappointed. I am grateful to noble friends and noble Baronesses on all sides of the House for their support.
My noble friend Lady Thomas of Winchester confirmed that progress has ground to a halt after the initial flurry after the 2010 Act. I agree with her that listed buildings should not be an excuse to do nothing, because there are many listed buildings that it is possible to sympathetically alter to grant disabled access. I will happily meet the Access Association. I will let my noble friend set that meeting up and we will see how we can take this forward.
I am also grateful to the noble Baroness, Lady Flather, for her kind intervention. She made the point that in order to help her husband to get out on to the patio, a little wooden ramp was made—just a piece of wood, two inches high at one end and planed to nothing at the other; that is all that takes for electric or non-electric wheelchairs to do it without a terrible jolt.
I will also add EAT to my boycott list of places I will not go into if they cannot be bothered to provide access. I must say to the noble Baroness—I call her my noble friend—that I am used to going through the basement in some places, particularly in the Foreign Office, which I used to attend regularly until recently. I would be taken through the basement, until they installed a little lift. Actually, going through the basement is still faster than trying to use the disabled lift. On one occasion when the rest of the lifts were not working, I had to use the garbage lift at the Foreign Office to get to a ministerial meeting.
I do not want to get too far into issues that do not relate to the Bill, but I suggest that whoever designed the new disabled loo round by the Speaker’s quarters should actually have talked to a few people in wheelchairs before designing it. Some parts of it may be convenient but the washbasin is in one corner, the soap dispenser is three feet away and the towels are another six feet away—someone needed to have given that a bit of extra thought.
I cannot comment in detail on sleeping arrangements. I almost thought that was an offer from the noble Baroness. But she is absolutely right. One of the problems that some of us with MS and many other disabilities face is restless legs and, if they kick and thrash around all night, certain ladies do complain, so I sympathise with that point.
I agree entirely with my noble friend Lady Brinton. I was trying to make a modest measure that I hoped the Government would not oppose because I was trying to impose a burden only on buildings with steps of less than six inches, but it should be 12 inches. It is not too difficult to do that. My noble friend the Minister made the point that, when shops have a doorstep right on the pavement, it is difficult and dangerous to put a permanent ramp there because others would trip over it; there is not the space to do it. But there are temporary ramps they can use or ramps that they can instantly rush out with and assist, if they have given it some thought. I agree with her entirely about the Marriott County Hall Hotel. The last time I was there, I went by the same circuitous route but I ended up going through the aquarium.
I also pay tribute to 1 Great George Street, which is the Institution of Civil Engineers. I go in there occasionally just to use the ramp and the lift, because I attended a meeting a couple of years ago—I think it was of the Royal Society in Carlton House Terrace—where there were no proper ramps. To get in there, there was a ramp of about 45 degrees, and I said, “That just cannot be done”. I know that these things are supposed to have a maximum incline of 7 degrees, which is a bit over the top; I can do about 30 degrees, but 45 degrees there was impossible. I came next day to a meeting in Great George Street. There was a button to push and a chap came out, and I said, “How do I get in here?”. I was really annoyed. “Oh”, he said, “no problem. Just you watch this, sir”. He pushed the button and all the steps receded into the wall. A lift materialised from the ground and up we went to the first level. At that level, all the marble steps disappeared into the wall, and up we went again—I must admit that I played with it on a few occasions, up and down.
No doubt that cost a lot, but that was in a listed building and they have shown how it can be done. I agree about some of the other buildings in Great George Street, apparently used by engineers. It is a disgrace when they open a rusty old door and you are taken through the basement. I have been through that route, too.
I totally agree with my noble friend that innovative technology is out there. I was asked to lunch at the Garrick Club last year—it was the first time that I had ever been asked to lunch there; I will probably be asked again to go back and apologise. It has a staircase of about 20 steps up. They came with a most amazing contraption—a rubber, crawler tractor thing. One parked one’s chair on it, tilted backwards and then this crawler thing went up the steps. It was absolutely scary to use the first time. But that was a solution. It was an expensive, £12,000 solution—I checked out the cost—but we are talking in this modest little Bill of measures of £10 or more, up to about £100 to replace the steps.
Without going into detail on taxis, which are not covered by the Bill, I say to my noble friend Lady Brinton that she is absolutely right. I have now learnt the hard way when I have wanted to flag down a cab. The older London cabs have a proper, fold-out ramp. The super-duper new Mercedes Vito cabs, which have wonderful space inside, one cannot get into, because they have two skids with side lips about two inches high and our clearance on these things is about 1.5 inches; we just cannot get into them. Other cities are not as good as London.
I pay tribute to the vast majority of London taxi drivers who pick us up. Only a tiny minority suddenly go blind when they see a wheelchair. My worst ever morning was when there were three cabs in a row. One decided to look out the other window; one switched off his light and zoomed off; and the third one gave me a finger—one finger on this occasion. They were followed by another cabbie who did an illegal U-turn, came screaming up beside me and said that he would not charge me for the journey; he was appalled by what his colleagues had done.
Finally on taxis, I carry a screwdriver in my chariot here—I am sure that I am able to use a visual aid—because so many cabbies cannot open the screw to get the disabled ramp out. Those who can often find that it is rusted solid, so I must carry some WD-40 as well.
I am grateful to the spokesperson for the Opposition, the noble Baroness, Lady Thornton, for her support for the Bill. From her background with her grandfather, she knows what it is like. I am grateful also to my noble friend the Minister for coming with me yesterday to look at the problem on the ground. She highlighted today that the key word is “reasonable”. Of course, one is not asking people to make “unreasonable” adjustments, but I simply say to my noble friend that I am not going to go around the 40 shops in Horseferry Road and so on, speak to individual shopkeepers and ask them to please put in a ramp for me and, if they refuse, then write to them and take court action against them. I expect someone else to be enforcing that rule. If the Government cannot accept the concept of my Bill, or even a future regulation, which may be far better, they—or someone—must do more on enforcement.
Finally, I accept that an automatic requirement to stick a ramp on every little shop, which could protrude into the pavement, could be dangerous. That may not be the best solution. Therefore, I hope that the Government will consider a regulation, which could have dozens of exemptions and opt-outs, to deal with the simple problem of shops that could easily install a ramp and the more difficult problem of shops which are right on the pavement, where a permanent ramp may be improper but some other facility could be installed. My Bill may be too blunt or too basic, but we need a solution either in better legislation than mine or in a regulation that would permit all the flexible solutions that we need. At the moment, we cannot get into shops. I am sorry about that. I therefore move that my Bill be given a Second Reading.