Grand Committee
Arrangement of Business
The Deputy Chairman of Committees (Lord Geddes) (Con)
My Lords, it is now 3.30 pm and, as usual on these occasions, I must advise the Grand Committee that if there is a Division in the Chamber while we are sitting, the Committee will adjourn as soon as the Division Bells are rung and resume after 10 minutes.
National Insurance Contributions Bill
(10 years ago)
Grand CommitteeRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Davies of Oldham (Lab)
My Lords, I rise to oppose Clause 1 standing part of the Bill, which ought to give the opportunity to explore in a little more detail the issues that we discussed previously. The Minister will appreciate that it was a fairly limited Second Reading, and I imagine he is anticipating that this Committee stage will also not be too prolonged. I certainly want to assure him that it is unlikely that I will ruin his Christmas Day and Boxing Day by giving him things to worry about on Report in the new year. We will move with some dispatch with regard to the Bill, because we are of course broadly in favour of it and have indicated that broad support at all stages. However, we have one or two anxieties, on which I would just like the Minister to give us the necessary reassurances that we have not detected thus far.
There are concerns about those who are going to be affected by the legislation. As the Minister will appreciate in particular, many who will be affected will be on low incomes, and therefore the issue of how and when payments are made is not a trivial matter but one that is bound to cause concern. We are worried about women claiming maternity allowance in the future. The Bill clearly recognises that pregnant women come into a particular category when it comes to claiming and we want to be certain about that, as well as about the rather broader category of those who claim universal credit. It would be very remiss if people on low incomes found themselves, as a result of this legislation, at a disadvantage when it came to claims for universal credit.
The self-employed will of course welcome the fact that the Bill introduces a simplification process and moves liability for NICs to the end of the tax year. However, that also means that there will be accumulated obligations that need to be paid, which for some low-paid workers could easily present very real problems indeed. We say this against the background of the Government making considerable play of the increase in the number of workers in the self-employed category. However, we detect that a very large number indeed are getting very little in terms of reward from this employment. We will come later on to those who were dangled a carrot—not, I hasten to say, by the Government but by unscrupulous intermediaries—about how to take a position with regard to the payment of NICs. We want reassurance from the Minister that he has fully taken on board the problems that may accrue for people who necessarily—we all know the evidence that establishes this—operate on the margin.
The Minister explained that the self-employed will continue to have the option of spreading the cost of paying NICs, but what is the method of payment? Is the Minister in a position to confirm that these payments may be made by monthly direct debit? That was the recommendation from the Chartered Institute of Taxation, and I would welcome his comment on that. Is the payment system due to be reviewed after implementation? We see it dealing with a group of people, some of whom—while many will find this very straightforward and will have welcomed the main proposals in the Bill, as indeed do the official Opposition—will find issues difficult. We wonder whether the Government have set in train a commitment to review the implementation of this part of the Bill.
The Government say that the simplification measure will help the self-employed, but of course it is the self-employed who have been the hardest hit in the cost-of-living crisis. A great number of the self-employed operate on very tight margins indeed, while those who have been self-employed for a considerable period of time, and are now subject to what may be an improvement in the way that NICs are collected, are likely to fall into the category of those who have lost significantly in recent years because average incomes have plummeted.
What other steps have the Government taken to address the impact that the cost-of-living crisis is having on self-employed people? It is clear that there has been a significant drop since this Government came into office, and therefore it would be a mistake on all our parts if, in thinking about the Bill as a progressive and helpful measure—a view that in broad terms we take—we failed to identify why those who are the hardest hit in our society might well find some difficulties in complying with the new arrangements.
Lord Newby (LD)
My Lords, I am extremely grateful to the noble Lord for his comments on Clause 1. He concentrated on the self-employed and the provisions for people to have a budget payment option available to them so that they can spread the cost. I assure him that budget payment plans will be operable and people can opt for them, paying by direct debit or standing order. They will allow an individual to decide the amount that they want to pay each week or month, change the regular payment amount, stop making payments for up to six months and cancel payments at any time. Indeed, even after they pay into the budget payment plan, an individual can choose to have the money repaid to them if they believe that there will be no eventual liability, or if they need it for another purpose. Indeed, we believe that this system is more flexible than what is currently available under the class 2 direct debit system, because someone is free to vary or cancel the arrangement at any time and there is no liability until a return is filed. They may request the money that they have paid through a budget repayment plan to be returned back to them, right up to the point when a future amount becomes a liability.
The noble Lord asked whether we would review the provision after implementation. The provision will indeed be kept under continuous review, because we are as keen as he is that everybody who operates it should be able to do so easily.
The noble Lord talked about the cost-of-living crisis as regards self-employed people and about the fact that, when many self-employed people become self-employed, they do so on a lower level of income than they were on when they were employed. That is undoubtedly true, but many people who start off on a lower level of income as self-employed build up a business and end up as well off as, if not better than, they were when they were employed. In addition, there is evidence that, for some people at least, being self-employed gives much more flexibility, which they welcome, and gives them a better work-life balance than they were able to achieve when they were in full-time employment.
The noble Lord talked about the cost-of-living crisis, but, as he is aware, the rate of inflation is low and falling and is likely to stay low; many prices—such as the price of petrol and food—are now falling and, as a result of the lower level of inflation, we are now seeing real wages rising across the board. All forecasters suggest that not just this year but for the next year and the next few years—indeed, for the entire forecast period—real wages are expected to rise. Therefore, while we do not in any way underestimate the impact of the recession on living standards, we believe that a very significant corner has been turned, and that the combination of low inflation, falling prices and rising real wages will mean that people will see greater prosperity than they have done as we have recovered from the great shock of 2008.
I hope that I have been able to give the noble Lord some reassurance on the specific questions that he raised.
Lord Davies of Oldham
My Lords, I am sure the Minister is pleased that we are making encouraging progress.
In moving that Clause 3 should not stand part of the Bill, I will reflect the fact that we are, of course, as committed as the Government to tackling tax avoidance and that we strongly believe that everyone must pay their fair share. As the Minister will recognise, tax avoidance is now a major issue as regards the operation of our economy, and there is not the slightest doubt that the public want things done. This is not the Bill in which to tackle the bigger of the issues—as regards multinationals and the problem of where they locate their profits as opposed to where they locate their sales and receipts—but the Bill is nevertheless a significant means of tackling tax avoidance, and we support that.
We are grateful in particular for the extension of measures to tackle high-risk promoters of NICs avoidance schemes, but we want some reassurance from the Minister that HMRC will be sufficiently resourced in order to implement both the measures and their safeguard. As the Bill has been considered, there has been constant reference on the government side to the amount of work that needs to be done—there is a great deal for Her Majesty’s Revenue & Customs to take on board. In a period when the major government priority seems to be to reduce the number of people who serve our society as national or local civil servants, he will forgive me if my party is anxious about how the Bill will be implemented as regards the manpower necessary to deal with these issues of tax avoidance.
We ask the Government to keep the measures on accelerated payments and follower notices under review, in addition to the new targeted anti-avoidance rule, as part of the review of all tax avoidance measures. It is quite clear that there are aspects of the collection of NICs—or the failure to collect NICs—which relate to quite a substantial business advising on how to avoid tax. We are pleased that the Government have recognised this as a significant problem, and the Bill represents their determination to act.
Lord Newby
My Lords, the noble Lord raises the key question about whether these provisions will actually have any impact. The statute book is littered with provisions that have not been fully implemented or properly policed. One has to think only of the minimum wage, which, when it was established, simply had no proper provisions attached to it to ensure that people were paying it. I am very pleased that this Government have been able to make considerable progress in implementing a measure that everybody agrees is a good one but which was not being effectively implemented in the past.
As far as these measures are concerned, the Government have provided significant reinvestment of around £1 billion specifically to combat revenue lost and at risk through non-compliance. This means that, while most of HMRC’s lines of business are reducing in size, the number of roles in compliance is increasing very considerably. HMRC has brought together all its work to tackle avoidance into a new counter-avoidance directorate. Around 100 staff have been recruited into the directorate to deal with the issue of accelerated payment notices, and a further 100 will be added in 2015. That is a very considerable additional resource. HMRC is also deploying additional staff to handle collection work and additional legal staff. HMRC is taking a flexible approach which will depend on the number and nature of legal challenges. The Tribunals Service is currently recruiting additional tribunal judges, both to handle the cases involving accelerated payments and follower notices and, more generally, to accelerate the number of cases going through the tribunal.
The noble Lord asked about the procedures which HMRC has in place in respect of follower notices. HMRC already has strong governance procedures in place to handle a range of complex issues such as these where significant amounts of tax are involved. Therefore, as with any of its responsibilities, it has put in place appropriate governance for follower notices and accelerated payments. The case team, advised by litigation specialists and solicitors, is responsible for analysing the decision to be used as the basis for the follower notice, identifying the relevant principles and reasoning and setting out how those apply to the potential follower notice cases. The recommendation is signed off by all relevant parties in the department before being submitted for approval. It is then presented to a senior governance body, chaired at senior Civil Service level, to consider whether or not to give that approval. The taxpayer can make representations that the judicial ruling is not relevant to their arrangements and must do so within 90 days of receiving the notice. The representations will be considered by an independent HMRC officer who is unconnected with the team which issued the follower notice and the governance panel which decided that the judicial decision relied upon was relevant.
In terms of how the department will monitor the effectiveness of the scheme, the purpose of the legislation is to change behaviour, so its success is not measured just by how many promoters are subject to the new information powers and penalties but by the number that improve their behaviour to acceptable levels and demonstrate this to HMRC without any need for action under the legislation. The frequency of use of the legislation will of course be monitored by HMRC, which is putting in place the governance arrangements that I have just described. But its wider success will have to be viewed more holistically—with regard, for example, to the need for additional legislation or for legislation to stop specific schemes in the future.
The noble Lord asked about a specific Statement to both Houses on the effectiveness of the scheme. The most logical way in which an annual report can be given on the effectiveness of the scheme will probably be in HMRC’s own annual report, which it is of course open for this House to debate and which is considered, I believe, by the other place. The Government are as keen as the noble Lord is to see how effective the scheme is, because we think it is an important way of improving the collection of tax. The Government will make sure that they constantly monitor its effectiveness and report on that. As I say, I think HMRC’s annual report would probably be the first way of doing that, but it would be open both for the Government to report separately, should they think it necessary, and for Parliament to keep HMRC and the Treasury up to the mark in terms of the information they provide to Parliament.
Lord Davies of Oldham
My Lords, let me say that this is an important provision in the Bill, which the Opposition support. We are glad to see that this important piece of legislation gives effect to certain promises that have been given on the overall issue of targeting tax avoidance.
In his previous answer, the noble Lord made it quite clear that there will be additional tribunal judges and so on, and I very much welcome that commitment because we all know the blockages that can occur in the work of tribunals. However, on the question of the staff in the new directorate, I was not too sure whether he was indicating that staff were being transferred from other parts of the department, because the department is so overladen with people with the expertise to get the work done that it is easy to effect such a transition, or whether further recruitment had been necessary. That point also applies to Clause 5, which deals with the important dimension of tax avoidance.
It is quite clear that the Government need to take further action to tackle the issue of false self-employment. In the past, many of the stories about that have issued from the construction industry, but it is quite clear that the vast growth in the number of self-employed applies far beyond the bounds of just the construction industry. It is clear that there have been occasions when self-employment levels have been very high in certain industries, but the construction industry stands out: the average is 14%, but in the construction industry it is 40%. What is the incentive among so many of the people who contribute to that industry being identified and set up as self-employed? Partially, it is to do with the nature of the work, but the construction industry is not that unique in the work that it does. For the construction industry to have such a substantial number of self-employed raises the obvious anxiety that it is of advantage to intermediaries, when considering taking on labour, to act in a way in which they take on “self-employed” workers, who are not really self-employed because they are effectively under the direction of those who see that their work gets done. This is a very real problem.
We want to confirm that the Government have committed themselves to monitoring closely the impact of changes introduced by this Bill on the issue of false self-employment. Ministers are aware, as we are, of the degree of self-employment that exists, which has probably been increasing in significant numbers in recent years. Are the Government committed to bringing forward new measures to tackle any continued abuse in this area? We would like a timeframe for some kind of review on this issue. It is commendable that the Government express the correct sentiments, but the Government are to be truly applauded only when they have properly served the nation by having delivered. We are interested in the question of delivery.
Let me say that we have reasons for anxiety. In the 2012 Autumn Statement, the Chancellor forecast that the Swiss deal would raise £3.12 billion. The latest figures from the ONS put the revenue to date as £868 million, which is a shortfall of £2.25 billion. As all Members of the Committee will recognise, that is a shortfall of almost two-thirds. In July, HMRC’s director-general of business tax told the House of Commons Treasury Committee that the actual amount recovered is now expected to be “reduced substantially” to around £1.7 billion, which is a shortfall of £1.42 billion. Despite the fact that the Government set out with the best of intentions, that is the result of ineffectiveness.
Lord Newby
My Lords, the noble Lord asked me a number of specific questions about this clause. The first question, on staffing, asked whether HMRC had the appropriate level of staffing and whether staff had been transferred across from other parts of HMRC or recruited specifically. HMRC carried out a review of the resource required and is committed to ensuring that the appropriate resource is in place to introduce the new changes. As regards where the staff came from, some were transferred and some were recruited. There is a maximum pace as regards how quickly you can beef up this kind of compliance department, because it is highly technical work, and in particular people coming in from outside need to have a considerable amount of training to get up to speed.
The noble Lord made the point that self-employment was high in a number of sectors and he mentioned in particular the construction industry, which is absolutely right. Of course the construction industry is very cyclical, and people literally move about if they are skilled workers in that sector. It is therefore not surprising that self-employment is somewhat higher there than in many other sectors—and the same applies to offshore workers. However, I completely agree with him that we need to keep a very close eye on that and see how it develops and how the measure is working.
HMRC is introducing a quarterly reporting requirement from 6 April 2015 in this area, with the first return due by 5 August next year. This will provide HMRC with almost real-time monitoring to ensure that the measure in the legislation is being used effectively. Obviously, the whole purpose of doing that is to keep the issue under review and, if necessary, to take action to rectify any further problems that apply.
The noble Lord pointed out that the Swiss tax deal had had a shortfall, which shows how difficult it is to estimate the amount of cash that such deals might generate. The reason for that is of course not too surprising: people deliberately secrete their money out of the gaze of the taxman, so when the taxman attempts to guess how much money there is, it is extremely tricky to get that right. The Swiss deal did indeed bring in a smaller amount of revenue than was expected—or it has to date—but I think it is fair to say that the Liechtenstein disclosure facility has brought in more than was originally thought and has proved exceptionally effective. All that one can expect HMRC and the Treasury to do in these circumstances, when specific areas are targeted to repatriate funds to the UK, is, first of all, to do it—which previous Governments have failed to do—and, secondly, to make their best estimate of how much money might be involved. There is a considerable degree of uncertainty at the point when that estimate is made. The important thing is to close the loophole.
The noble Lord also referred to the tax gap. All I would say to him is that in monetary terms the gap has risen by £1 billion over a period, but in real terms, and in relation to the size of the economy, I think it is fair to say that that is a fall. Although over a long period we might see the monetary value of the gap rising modestly, the key question is: is it falling as a proportion of the total amount of tax payable? The figures he quoted suggested that, if anything, on that basis the tax gap was falling rather than rising.
Perhaps I could have the indulgence of the Committee briefly, before we finish our Committee stage today, to say a little bit about the amendments to the Bill that the Government intend to introduce on Report. As noble Lords will be aware, in the Autumn Statement on 3 December the Chancellor announced that the Government will abolish employer class 1 NICs for apprentices under the age of 25 from April next year. As the Chancellor made clear, apprentices are at the heart of the Government’s drive to equip people of all ages with the skills valued by employers. This measure is intended to support employers who provide apprenticeships to young people by removing the requirement that they pay secondary class 1 NICs on earnings up to the upper earnings limit for those employees. The measure is also intended to support youth employment. It will provide a zero rate of employer class 1 NICs on earnings between the secondary threshold and the upper earnings limit in respect of apprentices under the age of 25 from 6 April 2016. It will provide the power to define “apprentice” in regulations, allowing the time discuss the definition with stakeholders. It will also contain powers to alter the age range to which the zero rate applies and introduce a threshold for apprentices. As with the other changes to which I am about to refer, the Government intend to table amendments to give effect to these measures in advance of Report.
Noble Lords will also be aware that the Delegated Powers and Regulatory Reform Committee published its report on the delegated powers contained in the Bill on 27 November. It drew attention to the power in Clause 2 to amend primary and secondary legislation as a consequence of the reform of class 2 NICs. The power is currently subject to the negative procedure. The Delegated Powers and Regulatory Reform Committee has said that the justification given in HMRC’s delegated powers memorandum is not sufficient for the negative procedure to apply where the power allows for the amendment or repeal of primary legislation, and it has recommended that in this instance the power should be subject to the affirmative procedure. The Government have considered the report of the Delegated Powers and Regulatory Reform Committee and intend to table an amendment on Report so that, where regulations made under this power amend or repeal primary legislation, they will be subject to the affirmative procedure.
Finally, we intend to amend Schedule 1 to the Bill to ensure that the relevant self-assessment penalties apply to class 2 contributions collected through self-assessment by adding a missing reference to the self-assessment underdeclaration penalty contained in Schedule 24 to the Finance Act 2007. It was always the Government’s intention to align penalties for class 2 contributions more closely with those for SA as part of the reform of class 2 so that the self-employed are not subjected to two different regimes, but this particular penalty was unintentionally omitted. This minor technical amendment will correct that omission.
I hope that noble Lords will have found that helpful. We will be tabling those amendments as soon as we possibly can.
Lord Davies of Oldham
My Lords, I am sure that the Committee is grateful to the Minister for indicating his response to the Delegated Powers Committee—that obviates the necessity of the Opposition chasing the Government on Report. We are very much in favour of the suggestion about the affirmative procedure, so we will be ensuring that the Report stage moves with maximum effect on that.
The only thing that I would add is that there is a certain justification for adding second thoughts and developments to a Bill as it proceeds. The Minister will recognise that it took the Delegated Powers Committee to bring this to the attention of the Government. We are only a couple of weeks from Christmas so I suppose we are bound to get a certain Christmas tree effect, but one of the consequences of this fixed-term Parliament is that, basically, since we came back in October we have had dangling bits of additional legislation added to Bills, whether they fit or not. In this respect I have no particular criticism, but I think for instance of the Infrastructure Bill, of which the first four parts were concluded before the Recess but then the minor issue of fracking was added to the Bill after it. The Government are not to take the fact that the Opposition very much approve of this initiative, which we will be supporting on Report, as in any way a feeling on our part that the Government are full of good conduct when it comes to adding bits to Bills whenever it suits them.
Banking Act 2009 (Restriction of Special Bail-in Provision, etc.) Order 2014
(10 years ago)
Grand CommitteeRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Newby
That the Grand Committee do consider the Banking Act 2009 (Restriction of Special Bail-in Provision, etc.) Order 2014.
Relevant document: 15th Report from the Joint Committee on Statutory Instruments
Lord Newby (LD)
My Lords, these four draft statutory instruments are intended to transpose the requirements of the European bank recovery and resolution directive, which I will refer to as the BRRD. As a package, they will significantly strengthen and enhance the UK’s special resolution regime, which puts in place arrangements to deal with the failure of banking institutions.
I will first set out the background to these provisions. In general, when a company fails, it will enter insolvency, and the company’s creditors will be paid out in accordance with the priority of their claim. However, the financial crisis demonstrated that it is sometimes not possible to allow banks which fail simply to enter insolvency. This is due to the need to protect the banks’ customers by ensuring they can continue to access essential services. It is also because of how interconnected the banking system is, with the failure of one bank having the potential to spread problems throughout the financial system.
Responding to the financial crisis, the Government of the day introduced the special resolution regime in the Banking Act 2009. This gave the Bank of England and the Treasury a set of tools that could be used to manage the failure of a bank and limit the negative consequences for the economy and the rest of the financial system. Many other Governments found themselves in similar situations and introduced their own resolution regimes.
As a result of that common experience, there has, since the crisis, been a concerted international effort to address the problems that led to the crisis, building on the first steps taken during the crisis and making sure that we have the tools available to address bank failures in the future. The UK has been at the forefront of these efforts. We have been an active participant in the Financial Stability Board, which, under the chairmanship of Mark Carney, has established a common resolution framework endorsed by G20 leaders. This framework is designed to ensure that banks are no longer considered “too big to fail”. It includes enhanced supervision, planning for the recovery and resolution of firms and co-operation between different jurisdictions.
The BRRD is part of this global push to make banks resolvable. It is designed to ensure that European member states have a harmonised set of resolution tools that can be used to manage the failure of a bank.
The Deputy Chairman of Committees (Lord Geddes) (Con)
My Lords, a Division has been called in the Chamber. The Grand Committee stands adjourned, to resume if possible after 10 minutes. However, I understand that both participants are tellers and therefore it might take slightly longer than 10 minutes—as soon as possible.
The Deputy Chairman of Committees
My Lords, the participants having returned, the Grand Committee is resumed. The noble Lord, Lord Newby, was cut off in his prime, for which I apologise.
Lord Newby
My Lords, as I was saying, the BRRD is part of this global push to make banks resolvable. It is designed to ensure that European member states have a harmonised set of resolution tools that can be used to manage the failure of a bank. It also puts in place mechanisms to facilitate co-operation between member states in planning for and managing failure. It covers banks, building societies, investment firms and banking group companies. The BRRD builds on the existing UK resolution regime in the Banking Act 2009, ensuring that many of the powers introduced in the UK will be replicated across the EU.
I now turn to each of the instruments in turn. First, the Bank Recovery and Resolution Order makes substantial amendments to the Banking Act 2009 to ensure that the UK special resolution regime is fully consistent with the BRRD. It inserts a new section into the Banking Act 2009 which gives the Bank of England a set of pre-resolution powers. They are designed to be used where, in the course of resolution planning, barriers to the effective resolution of the firm are identified.
These powers enable the Bank to require a firm to take action to ensure that the Bank could use its resolution powers effectively in the event that an institution fails. Where barriers have been identified, the Bank may, for example, direct a firm to dispose of certain assets or cease lines of business or change its legal or operational structure. To support these new powers for the Bank of England and its exercise of the stabilisation powers, the order gives the Bank new powers to gather information from firms. This includes a power to appoint an investigator to investigate a possible failure to comply with a direction. It also includes a power to apply for a warrant to enter premises in order to obtain documents that are required for the exercise of its functions.
Failure to comply with a requirement of the Bank of is an offence. This section replicates existing offences in the Financial Services and Markets Act 2000, which relate to requirements imposed by the PRA or the FCA in their role as regulator. Here, however, it relates to requirements imposed by the Bank of England. The Bank of England may delegate its enforcement of these powers to the PRA or FCA.
The order makes some amendments to the special resolution objectives, set out in Section 7 of the Banking Act. These amendments are designed to ensure full compliance with the BRRD, providing clarity and certainty for firms. There is nothing which fundamentally changes the objectives, which include ensuring the continuity of banking services, protecting financial stability and public funds and protecting depositors covered by the Financial Services Compensation Scheme.
The order adds a new section to the Banking Act 2009, which requires that relevant capital instruments of the firm—that is common equity, additional tier 1 capital and tier 2 capital—are either cancelled, reduced or converted into common equity at the point where a firm fails. This ensures that capital instruments do the job they are intended to do, which is to fully absorb losses at the point of failure. This write-down must occur before or at the same time as a stabilisation power is used. It may also happen in the absence of any resolution, either because the write-down is enough to restore the viability of the firm or because the firm is entering insolvency instead of being resolved.
The BRRD also introduces a new stabilisation option, the asset management vehicle. The Bank of England may transfer certain assets of the failing firm into an asset management vehicle, where they are then sold or wound down over time. This prevents destabilisation of the market through the immediate sale of the assets. It also prevents the assets being sold at an artificially low price.
The directive introduces a harmonised bail-in power across the EU. Bail-in is a tool which enables the Bank of England to cancel or modify contracts which create a liability for a failing bank. This allows the Bank of England to recapitalise the firm, stabilising it while the fundamental issues that have lead to its failure are addressed. The Government have had a policy to introduce bail-in powers for some time. Following significant progress on bail-in at an international level, and as part of the negotiations on the BRRD, the Government introduced bail-in powers via the Financial Services (Banking Reform) Act 2013. This order amends those provisions to ensure full consistency with the BRRD. In order to ensure that the bail-in is effective, it is necessary to prevent counterparties of the firm in resolution from closing out their contracts in order to avoid being subject to bail-in. The order therefore specifies that a range of contractual termination rights do not arise solely by virtue of the fact that a stabilisation power has been exercised.
The Bank of England is also given a power to impose a temporary stay on contractual obligations and security interests to which the firm in resolution is a party. This allows a short period while the firm is being stabilised, during which those obligations need not be met. This stay is very strictly limited in time to avoid having a disproportionate effect on affected parties.
This order also gives the Bank of England powers enabling it to support a resolution carried out in a foreign country. Where the Bank is notified by a foreign jurisdiction’s resolution authority that it has taken action to resolve a firm, the Bank must make an instrument that either recognises that action or refuses to recognise it. Recognition of a foreign resolution action will confirm that it has effect in the UK. This provides legal certainty about the effectiveness of resolution actions in other jurisdictions, reducing the risk of challenge and making cross-border resolution more effective. The Bank of England may refuse to recognise a third country’s resolution action, or any part of it, where certain conditions are met. These include a determination that the recognition would have an adverse effect on financial stability in the UK or the rest of the EEA, or that UK or other EEA creditors would be treated less favourably than non-EEA creditors with similar legal rights. The Treasury must approve any refusal by the Bank of England to recognise a third-country resolution action.
I move on to the second order, which puts in place safeguards for certain liabilities that may be subject to the bail-in tool in the event of failure. It protects certain types of set-off and netting arrangements that are respected in the event of insolvency. The provisions here ensure that they are also respected in bail-in. The order requires that liabilities relating to derivatives or financial contracts or covered by certain master agreements must be converted into a net debt, claim or liability prior to bail-in. Other types of liability covered by the safeguard must be treated as if they had been converted into a net liability. The order also puts in place arrangements for dealing with any breach of the safeguard. Where there has been a breach, the affected party is entitled to have that breach remedied. The remedy aims to ensure that the affected party is returned to the position that they would have been in had the safeguard not been breached.
The third order requires compensation arrangements to be put in place following the use of the bail-in powers. They are designed to ensure that the shareholders and creditors of the firm do not receive less favourable treatment than they would have done had the institution simply failed, without the exercise of the stabilisation powers. This is commonly known as the “no shareholder or creditor worse off” safeguard.
The fourth order implements the requirements of the BRRD on depositor preference. The majority of deposits in the UK, including all deposits of individuals, are protected by the Financial Services Compensation Scheme up to a value of £85,000 per depositor per institution. The Financial Services (Banking Reform) Act 2013 enhanced this protection by amending the Insolvency Act 1986 to add deposits covered by the Financial Services Compensation Scheme to the list of preferential debts. These debts are paid out first in insolvency, and are entitled to be paid out in full before other creditors receive any payments. This means that the majority of depositors in UK banks already have their deposits preferred.
The depositor preference order creates a new category of preferential debts, called secondary preferential debts. These are paid out after ordinary preferential debts but before other debts. All existing preferential debts, including covered deposits, will be ordinary preferential debts. The order designates amounts in deposits eligible for protection from the FSCS but above the £85,000 compensation limit as secondary preferential debts. Only deposits of individuals, micro-businesses and SMEs are given this preference. This change further reduces any chance that these depositors will be exposed to loss if the firm fails and either enters insolvency or is resolved using the powers in the Banking Act. This furthers the objective of protecting depositors.
I apologise for speaking at such length, but as the orders make extensive revisions to existing legislation I felt that they merited a thorough run-through. Taken together, they significantly enhance the UK’s resolution regime. Along with the other reforms that have been implemented to date, they will equip us well to deal with future bank failures in a way that protects taxpayers and the financial stability of the UK.
Lord Flight (Con)
My Lords, I would just like to put on record some concerns about the bail-in arrangements and what they are broadcast as achieving.
My first point is that, as the CEO of the Association of Corporate Treasurers recently said to the Lords EU Economic and Financial Affairs Sub-Committee, once there is any whiff of concern about a bank, any company will withdraw its deposits immediately. It is not going to hang around and wait for the bank to be subject to a bail-in. One thing that the bail-in arrangements do is actually accelerate the possibility of runs on banks. It will not be just corporate deposits; any form of lending to a bank will be subject to bail-in. If there is any whiff of trouble about that bank, that money will be withdrawn as soon as possible.
The second point, which perhaps has not been learnt from the recent banking crisis, is that the key thing that hugely accelerated the downturn in the economy in 2009 was allowing the money stock and the money supply to contract substantially, just as happened in America in the 1930s. If you are going to do a bail-in on a bank and its capital is going to get exhausted, it will have to contract its balance sheet dramatically, all other things being equal. While I note the comment that the Bank of England will come in and help, effectively it would have to be the state that came in and recapitalised banks or, again, the result would be a massive contraction of the money supply if any of the major banks were in trouble and thus required bail-in. Unless that happened, again, it would have the knock-on effect of a major economic contraction.
The bail-in arrangements make sense—we know what they want to achieve, which is to eliminate or at least reduce the extent to which the taxpayer has to bail out banks in a crisis—but people are kidding themselves if they believe that it is as simple as that. Fundamentally, even as a result of how the bail-in arrangements operate, unless the Government are there to replenish capital—whether they do so as the Bank of England or directly—you would have a huge monetary contraction, which would be damaging to the economy.
Lord Tunnicliffe (Lab)
My Lords, it is a privilege to be in Grand Committee again—and its packed rows—to address some affirmative orders. I thank the Minister for setting out the orders and indicate, as a generality, that the Official Opposition welcome the ideas behind the various Acts and the orders that make them operational. I will not make a contribution on the individual orders, but just a few comments about the concepts that are swept up in the orders, taken together.
I put on record my thanks to Catherine McCloskey, who was unfortunate enough to have her telephone number beside her name in the Explanatory Memorandum. Although I have sat through most of these banking debates and participated modestly in some of the amendments, I have to say that if you are not continuously involved with this, the whole shape of this legislation is impossible to retain in one’s mind. As a result of her tutelage, I think I have a reasonable view of the shape of the legislation and the orders and that I can claim that the Opposition have done their duty in probing the overall direction of the legislation and the effectiveness of the orders in bringing that legislation into effect.
However, I have some comments. As I understand them, the orders give effect to the BRRD and refine it for the UK environment—a sort of merging of our thinking and the thinking behind the directive. Everything becomes effective from 1 January next year, which strikes me as a good piece of clarity. As I recall, it was originally envisaged that there would be a period of British-only rules and then European rules, and so on. I commend the Government on meeting those timetables.
Lord Newby
My Lords, I thank noble Lords who have spoken on the debate on these orders. Their concerns fall into two parts. The first relates to whether this is a sensible way to do it, and what the negative consequences will be, and the second is a series of practical issues raised by the noble Lord, Lord Tunnicliffe.
The noble Lord, Lord Flight, said that these provisions could accelerate the possibility of runs on banks when it looks as though they are getting into difficulties but before we have got to resolution, and that if you get to resolution there will be a contraction of the money supply. If you have a banking crisis, whatever you do in advance, or even during the crisis, it will be extraordinarily difficult to deal with the crisis without there being costs somewhere. We are trying, with this regime, to ensure that the costs are minimised, for several reasons, and that the concept of “too big to fail”—that is, that the Government should be required to bail out banks if they get into difficulty—should no longer obtain.
First, we want the very fact that these provisions exist to have some impact on behaviour before we get to a crisis. We hope that well before you get to a crisis, shareholders and creditors will hold banks to account to a greater extent as regards their decisions. I hope that these provisions will give them an incentive to do that.
As regards the money supply, the Monetary Policy Committee monitors the money supply as part of its objectives and has a number of tools at its disposal to deal with that. Of course, resolution itself is intended to protect financial stability rather than the money supply, but the Bank has other tools in its locker to address the position as regards the money supply.
Lord Flight
If a bank loses its capital—and there are rules about how many multiples of its capital its expansion can be—it has to contract its expansion dramatically. That is the key problem: if you have a bail-out situation, it will most certainly remove all the bank’s capital, and that bank will have to contract dramatically. The question is: how will that be handled as regards the money supply?
Lord Newby
I accept that, my Lords, but if a bank gets into difficulties there are only two broad ways of dealing with it. One is for the Government to bail it out, and the other is for it to contract its capital in the way that the noble Lord describes. I think that there is a consensus internationally that we must get to the position that these orders will bring us to, where the primary responsibility will fall on the banks. As I say, it inevitably has an impact on the money supply—I do not deny that for a minute—but the simple point I was making is that the Bank of England has other tools in its locker to look at money supply.
Lord Tunnicliffe
Forgive my enthusiasm for money but it is a fascinating subject. The Minister says that the Bank of England has a series of tools in its locker. It would be unfair to ask him about them now but I wonder if he could do a small illustrative note to myself and the noble Lord, Lord Flight, about what particular tools he has in mind for that situation. Creating money supply would be a real challenge in those circumstances, and for us—and indeed the market—to know that the Bank of England had considered this and felt that it had the adequate armoury to tackle such a situation would be very good for my happiness and perhaps the wider happiness of the money environment.
Lord Newby
My Lords, I am very happy to write to the noble Lord in those terms. His happiness is always at the forefront of my mind.
The noble Lord, Lord Tunnicliffe, mentioned the effect of the exercise of these powers on funding for SMEs. In the immediate term, SMEs’ deposits would be protected, but in the aftermath of 2008 we certainly saw a big squeeze on funding for SMEs, which is now at best being only partially reversed. Part of the answer is that we are keen to see a much more broadly based and competitive environment so that SMEs are not forced, as they have been, to go to one of the handful of banks if they want funding. That is why we are so keen to see the establishment of new challenger banks for SME lending and the growth of peer-to-peer lending, which means that over a period we envisage that the proportion of SMEs that will be at risk from the small number of large banks will be greatly reduced.
The noble Lord, Lord Tunnicliffe, raised two broad questions about the way in which the orders will be implemented. The first related to the fact that it is virtually impossible to understand the orders because they amend other bits of legislation—how on earth is anyone to make any sense of them? We are in the worst possible position to make sense of them for the simple reason that, because the regulations are not yet in place, there is not readily available the kind of consolidated version of the Act, particularly the 2009 Act, that will rapidly be available via commercial databases—I was going to say “within seconds”, but more probably within a very small number of hours—after the orders have been approved. More generally, the National Archives is working on the production of amended versions of the primary legislation, which will be available to all, although I am not quite sure of the timing of that. If you are a depositor with a bank and you are worried about how this works, I would not actually direct you to the primary legislation in any event; even when it is consolidated, it is very difficult for the lay person to make any sense out of primary legislation all. People will need to look at the more general advice that will no doubt be available by googling “resolution”, “depositor protection” and the features of this scheme, because I am sure that many firms—banks and others—will have some commentary available on their websites as well. Of course, although I have not had a chance to look at it, I am sure that the Treasury will also have much relevant information available.
The noble Lord asked about contingency planning and resources. These are areas that he has, quite rightly, asked about in the past. In anticipation of him asking about them again, I have asked the Treasury the following questions. What is the name of the team in the Treasury and the Bank dealing with contingency planning? How many people are in it? Have they actually done any and, if so, what form did it take? The answer is that the financial stability group in the Treasury is responsible for identifying and analysing emerging risks to the financial stability of the UK and preparing and responding to them. In particular, it is responsible for the effective stewardship of government-supported banks; delivering structural reform in the UK banking system; developing the necessary legislation; and contingency planning for the possible failure of UK banks and putting those plans into action in the event of failure.
The group co-operates closely with the resolution directorate of the Bank of England. The resolution directorate co-ordinates the Bank of England’s resolution of failing UK banks. It also has responsibility for identifying the broad resolution strategy that outlines how a firm will be resolved, and for preparing the resolution plans that set out in detail how a firm will be resolved. The legislation introduced since the crisis requires banks to provide the authorities with information that will enable them to exercise their resolution powers and this includes detailed information about the firm and the identification of any substantial barriers to resolution that must then be addressed. This is an ongoing process, with the banks submitting information on an annual basis and the Bank of England updating its plans accordingly. The introduction of the recovery and resolution plans was a recommendation of the Turner review of the regulatory response to the financial crisis.
Lord Newby
My Lords, I had just answered the first of four questions that I had asked myself and my officials in respect of contingency planning under these orders. The second question was how many people were involved in the teams that I described before the Division. Around 40 people work in the financial stability group in the Treasury. In addition, contingency plans are in place enabling the group to draw on additional resources in the event that that becomes necessary. The list of reservists was one of the recommendations of Sharon White’s review of the Treasury’s response to the financial crisis, published in March 2012. The Treasury’s capability in this area has been significantly enhanced as a response to the crisis. Around 50 people work in the Bank’s resolution directorate. The Bank also has in place contingency plans that would allow it to rapidly increase the size of the directorate when necessary. Of course, in addition to the staff in the directorate, there are many more staff in the Bank and the PRA who work on financial stability more broadly.
I asked whether the teams had actually done any contingency planning. The authorities regularly carry out contingency planning in relation to economic trends and events that could have an impact on financial stability; for example, contingency planning in relation to instability in the eurozone. Finally, I asked: if so, what form did this work take? Among many other things, earlier in the year the Chancellor and the governor and deputy governors of the Bank travelled to Washington to participate in an exercise designed to further understanding, communication and co-operation between the US and UK authorities in the event of the failure of a cross-border globally systemically important bank. The exercise furthered our understanding of the key aspects of resolution planning that would require co-operation and communication between the UK and US authorities and how this would be achieved.
That is one example of the work undertaken in this area and the Government remain committed to the agenda of financial sector reform, including ensuring that robust contingency plans are in place to deal with the possible failure of UK banks. I hope I have been able to satisfy the noble Lord, Lord Tunnicliffe, at least in part.
Banks and Building Societies (Depositor Preference and Priorities) Order 2014
(10 years ago)
Grand CommitteeRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Newby
That the Grand Committee do consider the Banks and Building Societies (Depositor Preference and Priorities) Order 2014.
Relevant document: 15th Report from the Joint Committee on Statutory Instruments
Banking Act 2009 (Mandatory Compensation Arrangements Following Bail-in) Regulations 2014
(10 years ago)
Grand CommitteeRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Newby
That the Grand Committee do consider the Banking Act 2009 (Mandatory Compensation Arrangements Following Bail-in) Regulations 2014.
Relevant document: 15th Report from the Joint Committee on Statutory Instruments
Bank Recovery and Resolution Order 2014
(10 years ago)
Grand CommitteeRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Newby
That the Grand Committee do consider the Bank Recovery and Resolution Order 2014.
Relevant document: 15th Report from the Joint Committee on Statutory Instruments
Financial Services and Markets Act 2000 (Carrying on Regulated Activities by Way of Business) (Amendment) Order 2014
(10 years ago)
Grand CommitteeRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Newby
That the Grand Committee do consider the Financial Services and Markets Act 2000 (Carrying on Regulated Activities by Way of Business) (Amendment) Order 2014.
Relevant document: 14th Report from the Joint Committee on Statutory Instruments
Lord Newby (LD)
My Lords, noble Lords may find it helpful if I start by outlining the background to this regulation. The term “sale and rent back” refers to a type of transaction whereby homeowners agree to sell their property, usually at a discounted price, in exchange for tenancy rights. This product reached the peak of its popularity in 2008, when the Office of Fair Trading estimated that 50,000 of these transactions had taken place until that point. Its attraction was mainly to homeowners struggling to meet mortgage repayments but who wished to stay in their family home. However, a number of questions were raised over whether customers taking out these agreements were receiving fair treatment.
In 2008 the OFT investigated business practices in this market and published a report that confirmed the presence of significant consumer disadvantage, in two respects. The first was through the financial loss to the customer when the property was sold. The OFT found evidence to suggest that most sale and rent-back providers bought the properties at a significant discount, paying between 70% and 90% of the market value of the property. The second was a lack of security of tenure. Sale and rent-back agreements make a virtue of the homeowner’s ability to continue to live in their home. However, the OFT report showed that in many cases people were being relatively quickly evicted from their home, while they had been led to believe they would be able to stay there over the medium to long term.
The OFT identified a number of market failures that led to these poor outcomes. These included the asymmetry of information between vulnerable individuals with low levels of financial capability and professional salespeople offering these agreements. That was a particular problem in this market because transactions tended to be undertaken by people in difficult and stressful circumstances, who may not have been in a position to weigh up all their options carefully and objectively. However, another factor was that relatively few homeowners took out such agreements. That meant that these firms were not subject to reputational risks in the same way as many other types of firm, limiting the ability of an effective feedback mechanism to operate where customers were consistently receiving poor outcomes. In addition, the OFT found that these market failures were often compounded by the deliberately misleading high-pressure sales tactics used by many providers.
As a result of the OFT report, the then Government issued a consultation paper recommending the statutory regulation of the sale and rent-back market by the then Financial Services Authority. An interim system was introduced to regulate the market in 2009, but it was then replaced in June 2010 by full regulation, as the Government legislated to add sale and rent-back agreements to the list of financial services activities regulated by the FSA. This meant that the FSA was given the powers to make and apply appropriate regulatory rules. The regime developed by the FSA included a requirement for providers to offer a minimum tenancy length of five years, a requirement for independent property valuation and a ban on high-pressure sales tactics. However, even following the introduction of regulation, consumer groups and other housing market stakeholders continued to report the widespread occurrence of detriment caused by purchases failing to meet the standards set by the new regulatory regime.
In response to this, the FSA conducted a thematic review of the market in 2011. The review confirmed that new regulatory standards were not being met in a number of key areas. These areas included, but were by no means limited to, the requirements for tenancy agreements, the form of financial promotions and the disclosure that customers received. In the light of these findings, the FSA temporarily closed down the market to protect customers.
In addition, the report highlighted that many firms were using complex financial arrangements with private financial investors, which providers argued meant that they did not fall within the scope of the regulation as set out in the legislation. It was the private investors who actually entered into the agreements, often on a one-off basis, which allowed them to argue that they were not doing so in the course of business, and therefore they fell outside the scope of regulation and did not need to comply with the requirements intended to protect consumers.
In response to this latter point, the Treasury worked with the FSA to develop the Financial Services and Markets Act 2000 (Carrying on Regulated Activities by Way of Business) (Amendment) Order 2011. That made it clear that all sale and rent-back agreements should be within the scope of regulation unless it was a transaction between two family members. It ensured that the FSA was able to regulate this market effectively, as was originally intended by both this Government and the previous one.
Lord Tunnicliffe (Lab)
My Lords, this is a perfectly sensible order, which we support. It opens up the opportunity for a philosophical debate on sunset clauses—but because it is Christmas, I will not press the matter further.
House of Lords
Introduction: The Lord Bishop of Southwark
Death of a Member: Lord Knights
The Lord Speaker (Baroness D'Souza)
My Lords, I regret to inform the House of the death of the noble Lord, Lord Knights, on 11 December. On behalf of the House, I extend our condolences to the noble Lord’s family and friends.
NHS: Medical Staff
(10 years ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Fowler
To ask Her Majesty’s Government how many medical staff working in the National Health Service today, including doctors and nurses, were trained in Africa.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe) (Con)
My Lords, in 2013, the latest year for which figures are available, there were 6,472 doctors working in the NHS—that is 4.4%—who gained their primary medical qualification in Africa and 13,969 nurses on the Nursing and Midwifery Council’s register who trained in Africa. In that same year, 12,203 professional clinically qualified staff working in the NHS—that is 1.8%—held nationality with an African country.
Lord Fowler (Con)
My Lords, I pay tribute to the job that these people do for the National Health Service, but is not the lesson of the Ebola crisis that many of the health services in Africa are seriously underresourced? Can it be justified that not only Britain but other countries in Europe and the Middle East are taking much needed doctors and nurses away from Africa? Could we look at our own training policies to see how that position can be improved?
Earl Howe
My noble friend makes a very important point. As he will know, the UK signed the World Health Organization code of practice on the international recruitment of health personnel. My department worked together with the Department for International Development to produce a definitive list of developing countries—based on economic status and the availability of healthcare professionals—that should not be targeted for recruitment. He may like to know that the WHO is planning an assessment of the implementation of that code of practice and is due to report in 2016. However, we are mindful of the point made by my noble friend. Particularly with the Ebola crisis, it is important that we are sensitive to the serious issues that pertain in Sierra Leone in particular.
Lord Hunt of Kings Heath (Lab)
My Lords, given that, and given the Health Select Committee’s recommendation that although the contribution of overseas staff to the NHS should be celebrated, we should not be dependent on significant flows of trained staff from overseas, does the noble Earl still agree with the decision in 2012 to reduce the number of medical school training places by 2%? Does that not need reviewing?
Earl Howe
My Lords, as the noble Lord is aware, we rely on Health Education England to determine the number of training places that the NHS needs going forward, looking at not just the short term but also the medium to long term, informed by the work of the local education and training boards. That is as good a system as we believe we can get. Health Education England is properly funded to do that and we must rely on its expertise.
Lord Crisp (CB)
My Lords, I understand that the NHS in recent years has made it harder to employ people coming from poorer countries in Africa and elsewhere to work here. However the NHS, as the Minister has already stated, has a large number of people working within it from those backgrounds. I have two questions. First, what are the Government doing to aid countries to train more people in their own countries? Secondly, what are the latest figures for the international medical graduate scheme for people coming from Africa training in this country?
Lord Crisp
I hope I can remember it. It was very simply: what are we doing from the UK to support the training of people in their own countries, where they will often stay longer than if they come and train here?
Earl Howe
I beg your pardon, my Lords. DfID has a number of programmes designed to support the health economies of developing countries. They have been in place for many years. They can take the form of training, not just of doctors but of all healthcare professionals. I am aware that DfID is extremely supportive of those programmes.
Baroness Brinton (LD)
My Lords, 10 years ago there were more Malawian doctors working in England than there were in Malawi and the Royal College of Surgeons, working with CBM UK, a disability charity, set up the College of Surgeons of East, Central and Southern Africa. In that time the number of African-trained surgeons has substantially increased through this joint practice. Are other royal colleges following their example in setting up similar projects?
Earl Howe
I am not aware of the answer to that question but I can tell my noble friend that the UK has been moving towards self-sufficiency for a number of years. For example, there was a 27% decrease in the number of registrations of non-European Economic Area nurses from April 2010 to March 2014, continuing a longer-term trend. The number of doctors in the NHS with a primary medical qualification from outside the EEA has remained relatively static over the last four years despite the full-time equivalent number of doctors increasing by more than 5% over the same period. I think we can take heart from those figures, mindful, of course, of the need to adhere to the World Health Organization code of practice.
Baroness Wall of New Barnet (Lab)
My Lords, I am sure the whole House will join in the sentiments expressed by the noble Lord, Lord Fowler, about the tremendous work that these nurses and doctors do in our NHS. I declare an interest as chairman of Milton Keynes Hospital NHS Foundation Trust. As I am sure the noble Earl is aware, many of the hospitals now are encouraging some of the African nurses to go back and have an opportunity to train the skilled and unskilled nurses who are already in their own countries. Despite the fact that things are obviously very challenging for us here, it is very important that they are able to do that.
Earl Howe
I agree with the noble Baroness. It is important to underline that the medical training initiative, which is the means by which we can present an offer to foreign doctors—that is, postgraduate medical specialists—to come to train here, is a fixed-term arrangement for up to two years. It seeks to promote circular migration so that participants in a scheme can return to their home country and apply the skills and knowledge developed during their time in the UK. That is very valuable for those individuals and those countries.
Baroness Chisholm of Owlpen (Con)
My Lords, during my career as a nurse, I had the privilege of working with nurses from all over the world, including the African continent. They showed enormous compassion and dedication to their work. Does my noble friend feel that it is important that, when these nurses come to England, they are given all the support and training possible so that they reach the high standards that our nurses reach in their training here?
Earl Howe
My Lords, I do. My noble friend will be aware that the Nursing and Midwifery Council has established standards which ensure that the quality of the nurses whom we get from overseas is absolutely up to that of home-trained nurses. Support for those nurses while they are in this country is of course an essential ingredient if we are to keep them here for a reasonable length of time.
Higher Education: Financial Sustainability
Lord Sharkey
To ask Her Majesty’s Government what is their assessment of the Higher Education Commission’s report Too Good to Fail: The Financial Sustainability of Higher Education in England.
Baroness Williams of Trafford (Con)
My Lords, the Government welcome this contribution from the Higher Education Commission and are looking closely at its findings. In fact, the Chancellor, in his Autumn Statement, has already addressed the recommendation on postgraduate education. The UK enjoys a world-renowned reputation for the quality of its universities, and we have protected and enhanced that through our reforms. According to the OECD, we are one of the few nations to have introduced a sustainable system of higher education finance.
Lord Sharkey (LD)
The report notes that the overall number of students in higher education in England is actually declining due to very large falls in the numbers of part-time undergraduates, postgraduates and mature students. Does the Minister agree that this reduction in the diversity of our higher education system is a cause for concern, and can she tell the House what plans the Government have to address the situation, particularly when it comes to part-time undergraduates?
Baroness Williams of Trafford
My Lords, the figure for accepted entrants as of August 2014 was up by 4% and that for mature students was up by 6%. In terms of postgraduate funding, your Lordships will know that loans of up to £10,000 will be available from 2016-17. Indeed, in 2012 the Government introduced non-means-testing for loans for part-time students of 25% or more of the full-time equivalent.
Lord Hannay of Chiswick (CB)
My Lords, does the Minister not recognise that her original Answer sounded rather like someone sitting in the back of a canoe facing upstream just before going over a very large waterfall? Can she perhaps say something about financial sustainability, which she has not covered very fully? In particular, 45 modern languages schools in British universities closed in recent years on the grounds that they were not financially sustainable. Does that leave the Government calm or worried?
Baroness Williams of Trafford
My Lords, I do not recognise the words “canoe”, “upstream” or “waterfall” mentioned in that question. According to the OECD, we are one of the few nations to have introduced a system of sustainable higher education finance. Indeed, our numbers of students are up to record levels at nearly half a million.
Lord Stevenson of Balmacara (Lab)
My Lords, is there not a triple whammy? The Government are no longer funding higher education; they are funding the debts of students who are attending universities. Students are acquiring debts—the latest figures from the IFS show an average debt of £44,000 per student leaving university. In addition, as we have just heard, universities have lost funding for important courses such as languages. The Government say that there is no imminent pressure on the system. Which way is the Minister facing?
Baroness Williams of Trafford
My Lords, I am facing firmly in the direction of the widely accepted view that both the student and the state should share the burden of higher education. In fact, graduates have higher earning potential than non-graduates.
Baroness Benjamin (LD)
My Lords, we need to bridge the social mobility gap. As the report states, universities will have to face huge cuts in the future. How will the Government ensure that spending on widening access to higher education is not the first place where savings will be found? I declare an interest as the chancellor of the University of Exeter.
Baroness Williams of Trafford
My Lords, the cap will be lifted in 2016, widening access as far as possible. In fact, disadvantaged students now make up 17% of the total, which is a record level.
Lord Giddens (Lab)
My Lords, as someone who has worked in higher education all my life, I was very surprised by the Minister’s response to this report, which is a devastating critique of government policy on higher education. The report shows that it is unsustainable and that commercialism is undermining academic values and it indicates quite clearly that a change of course is absolutely necessary. Can the Minister say what change of course this would be and not just go into defensive mode about it?
Baroness Williams of Trafford
My Lords, I do not think I am going into defensive mode. I reiterate the view of the OECD, which is a widely respected body, on the sustainability of higher education finance. Like the noble Earl, Lord Howe, I have forgotten the second part of the question. I remember—since the report was published, as the Chancellor set out in the Autumn Statement, we have in fact announced that postgraduate loan-based funding would be available from 2016. We have addressed some of the concerns within the report.
Lord Brooke of Sutton Mandeville (Con)
My Lords, will my noble friend take comfort from the fact that when Mr Blair advanced the policy of “education, education, education”, he did so after the Conservatives had raised participation in higher education to a percentage in the middle 30s after inheriting a figure of 12% from the Labour Party in 1979?
Baroness Williams of Trafford
My Lords, I always take comfort in everything that my noble friend says.
The Archbishop of York
My Lords, will the noble Baroness tell us how, in the light of this report, she hopes to mitigate the risks to financial sustainability? Those are very big risks. Can she tell us how she will mitigate them? Forget the canoes.
Baroness Williams of Trafford
My Lords, the Government have asked HEFCE to monitor this situation, particularly in the light of the cap being lifted in 2016. That is a very important point.
Devolution: Arts and Culture
The Earl of Clancarty
To ask Her Majesty’s Government what assessment they have made of the effect of devolution on arts and culture within the United Kingdom.
Lord Gardiner of Kimble (Con)
My Lords, responsibility for arts and culture is devolved within the United Kingdom. Arts Council England works closely with its counterparts in Scotland, Wales and Northern Ireland, and together they share a collective aim of ensuring that arts and culture across the United Kingdom are available to all.
The Earl of Clancarty (CB)
My Lords, does not the Minister believe that, for regions to fund the arts properly, a provision for arts and cultural production—as a major contributor to a region’s cultural identity—should form a significant aspect of devolutionary arrangements? A prime example of much that is now under threat is the Ulster Orchestra, whose future is of concern not only to Northern Ireland but to the UK as a whole.
Lord Gardiner of Kimble
My Lords, decisions regarding the Ulster Orchestra are, of course, matters for the Northern Ireland Executive. I know that meetings have been held with the Northern Ireland Department of Culture, Arts and Leisure and, indeed, with Belfast City Council. I very much hope that those parties can work together to find solutions, but of course the UK Government have a role to play. That is absolutely why all the creative tax reliefs—there are now five and I hope there will be six, with orchestras under consultation—are going to play a very big part in helping creative industries.
Lord Wigley (PC)
My Lords, is the Minister aware that the coming year, 2015, is one in which we in Wales are celebrating the cultural links arising from the establishment of the Welsh community in Patagonia?
Lord Wigley
I gather from that response that there may not be total awareness of that fact.
Will the UK Government give positive support to the celebrations, as indeed are the Government of Wales and the Government of Argentina? Does the Minister consider that the Government might look on these cultural links as an opportunity and a context in which to seek to improve the relationship between the United Kingdom and Argentina?
Lord Gardiner of Kimble
My Lords, culture plays a big part in our relationship with many countries around the world. I am not briefed on whether the UK Government themselves are helping with the Patagonian exchange, but if one goes to Patagonia, there are Welsh-speaking villages and communities there, so it is important that Patagonia is part of our cultural links. I very much support what the noble Lord said.
Lord Howarth of Newport (Lab)
My Lords, does the Minister recognise that, in the days when local government was treated with respect and enjoyed large freedoms, accountable not to the Treasury but to its own ratepayers, cities thrived and many of them engaged in remarkable patronage of the arts? Unless the Government are willing to allow greater freedoms to cities across the United Kingdom and not just the ones that the Chancellor particularly favours, will not the prospects for funding for the arts outside London be pretty bleak?
Lord Gardiner of Kimble
My Lords, in fairness I do not think that the prospect for arts funding outside London is bleak. The increase in funding outside London is welcome. The noble Lord mentioned the Chancellor, but the Autumn Statement mentioned government support for £79 million of capital funding towards the construction of a new theatre and exhibition space, Factory, in Manchester, and the Great Exhibition, which is of course across all northern towns. The Government are also supporting the Glasgow School of Art, for example, following the devastating fire there. There are many examples of what is happening around the country.
Baroness McIntosh of Hudnall (Lab)
Following on from the question by my noble friend Lord Howarth, has the Minister read the article in today’s Guardian by Charlotte Higgins about what has happened in Newcastle over recent years as a result of the local authority there seeking to withdraw all its funding from its local arts organisations? Does he agree that with the inexorable move towards greater regional autonomy, it is absolutely essential that the arts and culture are built into the core provision that any local authority should be expected to make available to its citizens?
Lord Gardiner of Kimble
My Lords, there are many good examples of cities and towns that realise that arts and culture are at the very heart of their opportunity for economic growth. I very much hope that Newcastle will take a different turn, because cities such as Derry/Londonderry, or Hull, which will soon be City of Culture, have recognised that there is an opportunity. I very much encourage Newcastle to think the same.
Lord Elystan-Morgan (CB)
My Lords, in relation to broadcasting in Wales, will the Minister undertake that the Welsh broadcasting authority, S4C, will be given a special status and strength either by statute or in the new charter for the BBC, which comes into force on 31 December 2016? That would honour the solemn pledge given by the Prime Minister in the heady days following the Scottish independence referendum that Wales would be at the very heart of the devolution settlement.
Lord Gardiner of Kimble
My Lords, I will reflect on what the noble Lord said. I would want to think about it, but the devolution arrangements that we want to have in place are so that there is local identity and national identity. Welsh language and culture are very important.
Lord Cormack (Con)
Does my noble friend accept that the arts are a unifying force throughout the United Kingdom? Does he also accept that there is considerable unease at the withdrawing of funds from musical education? Nothing is more calculated to bring young people together than a common love of music. This is a cause of real concern.
Lord Gardiner of Kimble
My Lords, I do not have the figures in front of me but I know that there are robust figures about what the DfE is undertaking in music education, the importance of music education and the opportunities it brings. When I have the figures in front of me I shall speak to my noble friend.
Baroness Thornton (Lab)
My Lords, the Minister failed to answer the question put by my noble friend Lady Nye on 20 November, which concerned National Lottery funding for the arts and the current unequal impact this has on the arts in the regions. Does the Minister agree with those who argue that National Lottery funding for the arts should be allocated on an equal per capita basis?
Lord Gardiner of Kimble
My Lords, the funding for the lottery is on a capita basis but deprivation is part of its consideration.
Lord Lee of Trafford (LD)
Does my noble friend accept that an individual new development in the regions, such as the Lowry in Salford, can have a much wider regenerative effect when it is coupled with, say, the Imperial War Museum of the North and the BBC? The wider regenerative effect of a cluster can be much greater in the regions than in, say, our capital city.
Lord Gardiner of Kimble
My Lords, again, there are very good examples of where regeneration and the arts run hand in hand. In Northern Ireland, for instance, the creative industries are worth half a billion pounds a year, and there are areas around Belfast cathedral where creative industries are centred, which is very much part of the regeneration of that great city.
Child Sex Abuse Inquiry
(10 years ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Marks of Henley-on-Thames
To ask Her Majesty’s Government what progress has been made towards the appointment of a chairman for the independent panel inquiry into child sexual abuse.
The Parliamentary Under-Secretary of State, Home Office (Lord Bates) (Con)
My Lords, the Home Secretary takes the appointment of the next chairman extremely seriously. Following the resignation of Fiona Woolf, the Home Secretary has sought the views of survivors’ groups to inform her on the appointment and she will update Parliament in due course.
Lord Marks of Henley-on-Thames (LD)
My Lords, can my noble friend say whether the Government have approached the Lord Chief Justice to see whether a serving judge might be available to chair the inquiry—and, if so, with what result? Can he say what the Government’s position would be if a potential chair made acceptance of appointment conditional on having statutory powers to compel witnesses and disclosure of documents?
Lord Bates
I am grateful to my noble friend for that question. With regard to the Home Secretary’s Statement on this matter on 3 November, we have since had 130 applications, some of which have been from serving judges. Therefore, it would be entirely appropriate for the Lord Chief Justice to be consulted on their availability to perform such a task if they were asked. With regard to the statutory footing, my right honourable friend the Home Secretary has said that if the chairman requested that the inquiry should be put on a statutory footing, she would take that into consideration. However, it does not have to be a judge for it to be statutory, because the statutory powers come from the Inquiries Act 2005.
Lord Morris of Aberavon (Lab)
My Lords, given the catalogue of mishaps in the appointing of a chairman, does the Home Secretary personally see a person she is minded to appoint as chairman?
Lord Bates
Part of the issue here is that because of a series of announcements and revelations which brought about huge concern, there was a desire to move very quickly to establish the inquiry. The important thing, we recognise now, is to put survivors’ groups, and the confidence of those groups, at the heart of this, which is the reason the Home Secretary has met survivors’ groups three times—on 3, 20 and 25 November—and indeed is meeting them today.
Baroness Newlove (Con)
My Lords, while we are discussing who is to be the chairperson for this inquiry—it is important that we get the right person—my concern is to support the victims in the mean time. What assurances can the Minister give about the support that will be provided, because it is not right through the bureaucratic processes to ask these victims what has gone on in their lives while they are being hit by barriers and not being given the right support and recognition of what they have gone through?
Lord Bates
My noble friend is absolutely right. I also pay tribute to her work as the Victims’ Commissioner, which she carries out assiduously. Of course more needs to be done to help the victims. We are consulting with the Department of Health to find out what additional help we can provide, and in the interim we will be announcing a further package of £2 million of support for victims’ groups in the ongoing discussions.
Lord Rosser (Lab)
We seem to be getting nowhere fast on this one, which is in marked contrast to the successful work done by my noble friend Lord Harris of Haringey on campaigning to close the loopholes on soliciting sexual material from a child—an issue which the Government have at last decided to take on board. Frankly, that they have still failed to find a chairman suggests that suitably qualified candidates are perhaps now being put off by the inevitable trawling through their personal lives, backgrounds and families by the media which the Government’s ineptitude has ensured will now occur. Can the Minister tell us why the Home Office failed to carry out basic background checks on Fiona Woolf, having had the first appointee stand down? Further, while I think the Minister has said that the survivors and victims of abuse are being consulted on the issue of the new chairman, can he say whether the terms of reference and the format of the inquiry are also being discussed with them?
Lord Bates
The noble Lord’s latter point is of course central to the discussion with the survivors. They want to have confidence that individuals can be compelled to give evidence and that that evidence will actually be available to them. Perhaps I may say that it is a bit unfortunate for the noble Lord to take that tone in relation to the appointments. Both the people who were appointed to the role of chair are eminently qualified to do the work, but the question mark was over whether they would command the confidence of the survivors’ groups. It became apparent that that was not the case, and that is the reason the Home Secretary is going to the lengths that she is to listen to them now.
Baroness Walmsley (LD)
My Lords, when consulting with potential candidates for the chair, will the Home Secretary consider the length of time that that person will be available for the inquiry? We must bear in mind the fact that the very nature of the inquiry means that various new issues probably will arise during the course of the panel’s investigations, and they will need to be given proper consideration. She is going to need someone who can be available for really quite a long time.
Lord Bates
That was one of the reasons why the panel was set up in its current form for the initial period. It wanted to draw on the excellent work that had been done by Ann Coffey, Alexis Jay and the NSPCC, among others, who had produced literature and evidence. We did not want the panel to reinvent the wheel but rather to get on and make sure that our institutions are sound, that victims’ voices are heard, and that we take action to ensure that these things could not happen again. The emphasis is now on speed. We want to get this done, but obviously the work must be carried out with the confidence of the survivors’ groups.
Keeping and Introduction of Fish (England and River Esk Catchment Area) Regulations 2015
(10 years ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord De Mauley
That the draft regulations laid before the House on 7 and 11 November be approved.
Relevant documents: 13th and 14th Reports from the Joint Committee on Statutory Instruments. Considered in Grand Committee on 8 December.
Single Source Contract Regulations 2014
Baroness Jolly
That the draft regulations laid before the House on 29 October be approved.
Relevant document: 15th Report from the Joint Committee on Statutory Instruments (special attention drawn to the instrument). Considered in Grand Committee on 8 December.
Electricity Capacity (Supplier Payment etc.) Regulations 2014
Lord Gardiner of Kimble
That the draft regulations laid before the House on 10 November be approved.
Relevant document: 13th Report from the Joint Committee on Statutory Instruments. Considered in Grand Committee on 8 December.
Conduct of Employment Agencies and Employment Businesses (Amendment) Regulations 2014
Lord Popat
That the draft regulations laid before the House on 11 November be approved.
Relevant documents: 14th Report from the Joint Committee on Statutory Instruments, 15th Report from the Secondary Legislation Scrutiny Committee. Considered in Grand Committee on 8 December.
Small Business, Enterprise and Employment Bill
Baroness Neville-Rolfe
That the Bill be committed to a Grand Committee, and that it be an instruction to the Committee that they consider the Bill in the following order:
Clauses 1 to 39, Clauses 71 to 74, Schedule 2, Clauses 75 to 78, Schedule 3, Clauses 79 to 81, Schedule 4, Clauses 82 to 91, Schedule 5, Clauses 92 to 94, Schedule 6, Clauses 95 to 108, Schedule 7, Clause 109, Schedule 8, Clauses 110 to 123, Schedule 9, Clauses 124 to 130, Schedule 10, Clauses 131 to 141, Schedule 11, Clauses 142 to 151, Clause 40, Schedule 1, Clauses 41 to 70, Clauses 152 to 158.
The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Neville-Rolfe) (Con)
My Lords, further to our Second Reading debate on 2 December, I now beg to move the commitment Motion for the Small Business, Enterprise and Employment Bill. This has been agreed through the usual channels. The Motion sets out that the Bill will be taken in Grand Committee. Furthermore, given that Clause 42 was added to the Bill only at Commons Report stage by way of a government defeat, the Order of Consideration Motion sets out that Part 4 on pubs will be taken after Part 11 on employment.
As I set out at Second Reading, the Government have accepted the principle that there should be a market rent-only option for tied pub tenants. However, the clause will require some amendments to ensure that it works correctly, is consistent and mitigates some potential unintended consequences. A later consideration in Committee will allow everyone more time to consider these important points. I welcome the commitment from the noble Lord, Lord Stevenson, at Second Reading to work with the Government to ensure that the clause works effectively. I look forward to support for the commitment Motion.
Lord Stevenson of Balmacara (Lab)
My Lords, I thank the Minister for repeating the assurance she made at Second Reading that the Government accept the principle of the introduction of a market rent-only option for tenanted pubs. We understand the reasons for wishing to reorder consideration of the Bill and I confirm that we are very happy to work with the Government to ensure that this option is made workable.
Social Action, Responsibility and Heroism Bill
(10 years ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
16:16 - Division on Amendment 1 - Ayes: 77 / Noes: 222 - Amendment 1 disagreed.
17:06 - Division on Amendment 2 - Ayes: 190 / Noes: 238 - Amendment 2 disagreed.
Lord Lloyd of Berwick
Lord Lloyd of Berwick (CB)
My Lords, there are many reasons why Clause 2 should not stand part of the Bill, but to my mind the main objection is also the simplest: it serves no useful purpose. The mischief at which the clause is aimed is already covered by existing law. The mischief in question, as defined by the Lord Chancellor in the other place, is that volunteers are being deterred from volunteering by fear of being sued for negligence. That is the very same point specifically covered by Section 1 of the Compensation Act 2006, passed less than eight years ago.
The whole purpose of that section was to encourage people to undertake what the section calls, “desirable activities”. The whole purpose of Clause 2 of the Bill is to encourage people to act,
“for the benefit of society”.
Those are two ways of saying exactly the same thing. Nobody has yet been able to detect any difference between them. Indeed, the Lord Chancellor said that Clause 2 is not intended to change the existing law, so why do we need another piece of legislation covering exactly the same ground now?
The noble Lord, Lord Faulks, accepted that:
“Clause 2 relates to broadly similar territory to that in Section 1 of the Compensation Act”,
but he added that,
“the approach that it takes is different”.—[Official Report, 4/11/2014; col. 1573.]
He did not explain exactly what he meant by the approach being different. When pressed, he said that the 2006 Act had been “ineffective”. However, the only evidence relied on for that assertion—literally the only evidence—was a survey carried out about eight years ago. All it showed was that 47% of a very modest sample, some 300 people at most, said that there was a risk of being sued and that that risk was an issue to be considered. That survey was carried out in 2006-07, before Section 1 of the Compensation Act could possibly have had any effect, so how can it be relied on as showing that Section 1 of the 2006 Act has been ineffective? At the time of that survey, it had not had time to take effect.
A recent report produced by the Joint Committee on Human Rights considered the evidence in support of the Government’s case for fresh legislation in this field. It concluded that the only evidence was almost entirely anecdotal. It said that such evidence was not a sound basis for legislation, and that must surely be right. We now have before us a clause for which there is no evidence of any need covering exactly the same ground as Section 1 of the Compensation Act, which was passed less than eight years ago, and covering the ground already covered by the common law. In negligence cases, judges have always had regard to the matters referred to in Clause 2.
If that was not enough to condemn the clause—although I suggest that it is—the National Council for Voluntary Organisations has recently said that this clause, even if it is to form part of the Bill, will have very little, if any, effect. Indeed, that was the Government’s own case. Paragraph 23 of their impact assessment states that any reduction in claims for negligence will not be substantial.
If, as I suggest, these reasons are nothing like enough to justify the inclusion of this clause, one is driven to ask: what is the real reason the Lord Chancellor is bringing forward this unnecessary clause for our approval? There can be no doubt about the answer to that question, because the Lord Chancellor himself said it over and over again in the other place. The real reason is that the Lord Chancellor wants to send out, as he put it, a strong signal that if people are trying to do the right thing—he used that sort of phraseology over and over again—the law will be on their side. In other words, the justification for including this clause in the Bill is nothing other than a publicity exercise on the part of the Government. If that is the case, and I suggest that it is, it is a flagrant misuse of the legislative process. The purpose of legislation is to make new law or to change existing law so that it can be enforced in the courts. This clause does not purport to do either of those things. It could not be enforced by the court, which is why it will be treated with derision when it comes before the courts—a word that was used by a recent Solicitor-General, Sir Edward Garnier, speaking from the government Benches in the other place. The clause should be rejected on that ground, if none other.
Finally, I should mention points made during the debate in Committee. The noble Lord, Lord Hodgson of Astley Abbotts, who I am glad to see in his place, is in favour of Clause 2. He was chair of the task force which published in 2011 the report Unshackling Good Neighbours. His view is obviously, therefore, entitled to great weight on that ground. I hope, however, that he will forgive me for saying that he did not really answer the point that Clause 2 covers exactly the same ground as Section 1 of the Compensation Act 2006, which should be given much more time to take effect.
On the other hand, the noble Lord, Lord Blair, said that, while he was broadly in sympathy with the Government’s objective, this was, as he put it,
“frankly, a lousy way to do it”.—[Official Report, 18/11/14; col. 404.]
It was smoothing over all the difficulties with words that have very little meaning. The noble and learned Lord, Lord Hope, went further. He was extremely critical of the drafting because of the use of the same word, “person”, in Clauses 2 and 4 to cover two entirely different persons. He said it was a great pity that the Government had not faced up to the real problems in this area. As a result, he said, he was deeply troubled by the clause as it stands.
For all these reasons, I hope the Government will think again before pressing ahead with this unnecessary clause. I beg to move.
Lord Hodgson of Astley Abbotts (Con)
My Lords, the noble and learned Lord was kind enough to say some nice things about my report, and I reciprocate by saying that I have had the pleasure of serving under his chairmanship of various committees, and he has always been a punctilious and perceptive chairman. He is particularly kind in being ready to listen to and appreciate the views of those of us who are not learned in the law.
I hope that he will forgive me, but, once again, I cannot support his proposal this afternoon, and I urge my noble friend on the Front Bench not to do so either. We had a pretty thorough discussion of this issue in Committee on 18 November, and I do not intend to repeat the remarks I made then. As I understand it, and as I understood then, the noble and learned Lord is concerned about interplay between this piece of legislation and the Compensation Act 2006. I understand his desire for legal clarity and legal purity, but I have another objective, and that is of legal connectivity.
The report that I produced for the Government, Unshackling Good Neighbours, to which he kindly referred, looked in some depth at what was inhibiting people from getting involved in society and acting as a trustee, and whether they feared potential legal consequences. We received examples in sufficient numbers, which cannot simply be dismissed as anecdotal—a term that I sometimes feel is somewhat patronising. The noble and learned Lord sought to reassure the House that, if a case came to court, the court would throw it out, would, in his phrase, “have regard for the circumstances”. With respect, he may have overlooked the effect on an individual of the agonising, expensive, lengthy and psychologically depressing process of preparing the case—this against the background that, in the event, the court may not throw the case out.
I continue, therefore, to believe that this legislation sends an important signal—there I agree with the noble and learned Lord. This signal may seem unnecessary in the cool, calm, reflective atmosphere of the Inns of Court, but it has a greater resonance at the coalface of our civil society.
At another level, I am particularly looking forward to hearing the final determination of the Opposition’s position on this issue. The noble Lord, Lord Beecham, is a witty speaker and a very practised politician. He has made some disobliging remarks about the contents of the Bill, but he has so far not moved beyond that point. I suspect that, as a practical politician, in his heart of hearts, he knows that this is an issue that, in the minds of the public, needs addressing, and which this Bill does so address.
Before I conclude, I reiterate one other point that I made in Committee. I do not argue for a single minute that the Bill is a silver bullet as regards encouraging volunteering or greater participation in our society. There is much else to be done besides. Better insurance arrangements are crucial, as is the need to debunk myths about the legal consequences of day-to-day actions, too often assiduously and repeatedly promulgated in the press. However, even if the Bill is not a silver bullet, it is a bullet, and one well worth firing. I hope that my noble friend on the Front Bench will resist the noble and learned Lord this afternoon.
Lord Pannick (CB)
My Lords, we have had our fun on this Bill at Second Reading and in Committee. I, for my part, cannot remember a legislative proposal that has been the subject of more sustained ridicule and derision. We now come to the serious business. I have been studying and practising law for 40 years—not as long as many noble Lords, but a long time—and I cannot remember a more pointless, indeed fatuous, piece of legislation than Clause 2 of this Bill, with the possible exception of Clauses 3 and 4 of this Bill. As the noble and learned Lord, Lord Lloyd of Berwick, has explained and as we have previously discussed—and as is not in dispute—Clause 2 will not change the law. Courts already have regard to whether the alleged negligence or breach of statutory duty occurred when the person was acting for the benefit of society or any of its members. I referred to the leading cases at Second Reading. The Minister has at no stage suggested that there are any cases in which courts have ignored such obviously relevant factors.
What then is the point of Clause 2? As the noble and learned Lord, Lord Lloyd, has already explained, the Lord Chancellor, Mr Grayling, has been very clear. He wants Parliament to send a message. But if the object of the legislation is to encourage people to volunteer and to encourage heroism without people being concerned about possible litigation—the objective referred to a few moments ago by the noble Lord, Lord Hodgson of Astley Abbotts—Mr Grayling should buy a half-page advertisement in the Sun or the Daily Mail or, if he wants to reach younger citizens, open a Facebook page or set up a Twitter account, and simply tell people the obvious truth, that the law is already on their side. That would be a much cheaper and more effective way in which to communicate a message than to take this sad Bill through all its stages in Parliament.
It is simply ridiculous for the Government to suggest that people who are currently inhibited from volunteering by a fear of litigation are somehow going to step forward when they hear—if they do—that we have approved Clause 2 of the Bill. Mr Grayling cannot seriously think that around the dinner table tonight, or in the Dog and Duck public house, or anywhere, people will say to themselves, “I see that Clause 2 has passed its latest stages in the House of Lords. I look forward to its speedy enactment next year because then I will be much more willing to volunteer and act like a hero, my concerns about litigation having been removed”.
Lord Hodgson of Astley Abbotts
I am very grateful to the noble Lord for giving way. It is not just people in the saloon bar of the Dog and Duck who are influenced by this; it is also the professional advisers. In the example that we discussed in Committee, the problem was that many solicitors offering advice to people actually provide advice that might be changed by this legislation.
Lord Pannick
With great respect, there is even less justification if we are going to ask the question about professional advice from solicitors, because we are surely entitled to assume that solicitors are capable of understanding basic law. This is not complicated law: it is trite, obvious law that already protects those who volunteer and act as heroes.
It has been said at previous stages of the Bill that we often legislate in the hope of changing people’s behaviour. Reference has been made, for example, to the Race Relations Act. But what is different and what is exceptional about Clause 2 is that it does not purport to change the law one jot or iota. All that it will do is enable Mr Grayling to say that he is in favour of social action; and when we come to Clause 4, he will be able to say that he is in favour of heroism, as if the rest of us were not. I object to legislation being used by the Government to send what is no more than a political message.
In paragraph 125 of its excellent report, published last week, on the office of Lord Chancellor, your Lordships’ Constitution Committee stated that the Lord Chancellor should have,
“a clear understanding of his or her duties in relation to the rule of law and a willingness to speak up for that principle in dealings with ministerial colleagues, including the Prime Minister”.
The Lord Chancellor ought to understand that it is part—an important part—of the rule of law that the statute book has a role and a purpose: it is a purpose distinct from a party conference speech or a party election broadcast. Clause 2 simply debases the parliamentary currency and it therefore undermines the rule of law. If the noble and learned Lord, Lord Lloyd of Berwick, decides to test the opinion of the House on Clause 2, he will certainly have my support.
Lord Blair of Boughton (CB)
My Lords, I spoke in Committee in support of the noble and learned Lord, Lord Lloyd, and I am not going to repeat what I said then. I might take issue with the noble Lord, Lord Hodgson, about this matter being discussed in the silent halls of the Middle Temple. If you give ordinary police officers, firemen and ambulance crews two sets of words about the same thing, you are going to cause a lot of confusion a long way before it gets to the Middle Temple.
In the gap since we spoke about this in Committee, this law has achieved something that I have not seen in this House before. I know I have not been here that long, but I have never heard of a particular statute being used as an example in another discussion altogether when it has not even been passed. In the debate put forward on 4 December by the noble Lord, Lord Foulkes of Cumnock, about the procedures and practices of the House, this Bill got not just one but two mentions. It was mentioned by the noble Lord, Lord Butler, who is in his place next to me, and by the noble Lord, Lord Dykes. The noble Lord, Lord Butler, said that,
“we might be saved from legislation such as the absurd Social Action, Responsibility and Heroism Bill”.—[Official Report, 4/12/14; col. 1495.]
Later, the Bill was described as,
“a badly drafted, silly Bill that is all to do with ‘manifesto-itis’ rather than any deep legislative urge on behalf of the Executive”.—[Official Report, 4/12/14; col. 1499.]
I do not think we should proceed with this matter.
Lord Hope of Craighead (CB)
My Lords, perhaps I may return briefly to the point that I made in Committee, which is directed to the point made by the noble Lord, Lord Hodgson, about the solicitor advising—no doubt—an employer. The problem to which I drew attention was where somebody such as a fireman, police officer or some other person in the emergency services wanted to take the kind of action for the benefit of society that is talked about in Clause 2, but his superior officers said, “No, you can’t, because if you do that, my organisation is liable to be sued”.
My point is that Section 1 of the previous statute deals with outcomes and separates the outcome from the person who is being sued. The problem with this Bill is that it links irrevocably and inextricably the person who is being sued with the person who is acting. With great respect to the noble and learned Lord, Lord Lloyd of Berwick, I do not think that this clause and the section deal with precisely the same thing. I think that this is a much narrower clause, dealing with a particular part of the subject. Therefore, it just adds to confusion when we have an existing piece of legislation which covers all the aspects and is perfectly serviceable to then come along with something which covers only part of it.
When the Minister replies, I hope that he will say why the Government have not taken the opportunity to broaden this clause so that it covers precisely the same ground as the existing legislation, because to have two pieces of legislation, one half-baked and one dealing with the whole thing, just adds to confusion. It is a great shame to be invited to pass a measure of that kind.
Lord Elystan-Morgan (CB)
My Lords, the noble Lord, Lord Hodgson, with great force and fervour, invites the House to consider that a silver bullet from this place and the other place is perhaps not a bad thing at all. That may well be so, and both Houses are entitled to fire silver bullets by way of resolutions, debates and in a number of other ways, but not in their legislative capacity. That is really all that this issue is about.
There are only three areas of law—or at least there used to be when I was a law student a very long time ago—statute, common law and custom. If a statute is to have any purpose or meaning at all, it has to change to some extent one at least of those three areas. Custom can be left out of it; it is agreed universally that it does not change the content of a statute by one hair’s breadth. There was, I think, some dubiety in Committee about common law, but I honestly think that that is answered by a long-standing principle in our law—namely, that a statute to change the common law has to say so expressly on the face of it and to make it clear beyond peradventure or doubt that that is happening: otherwise, there is a presumption that the common law is not changed. I should have brought Maxwell’s Interpretation of Statutes along with me but I am sure that the Minister will accept that that is still a fundamental principle of our law. The right to legislate is a sovereign right and privilege to be used sparingly. It is not to be used for propaganda purposes.
Lord Walker of Gestingthorpe (CB)
My Lords, in speaking in support of this amendment, I draw attention to a matter which I believe to be of general importance and relevance to all the contentious amendments before the House this afternoon, but which has not, I believe, been referred to at all in previous debates on this Bill either in this House or the other place—namely, that the Law Commission has had no input at all into the Bill. The subject matter of the Bill is not on the published programme of current work of the Law Commission: nor—I checked this point a couple of days ago with the press officer of the Law Commission—have there been any informal consultations or amendments concerned with the Bill. Neither the substance of the Bill nor its drafting has had any input at all from the Law Commission. Yet this is a Bill which is said to make significant changes in the common law.
Whether it does, indeed, make significant changes in the common law is highly contentious. Along with many of my noble and learned friends, I believe that it makes no significant change at all. However, on the hypothesis that it does make significant changes in the common law, it is eminently a matter of law reform which should be the subject of systematic and intense study by the Law Commission and a consultation with judges, the legal profession and the wider public, conducted by the commission. None of that has happened.
Lord Brown of Eaton-under-Heywood (CB)
My Lords, I do not wish to appear conspicuous by my silence on this Bench but will speak very briefly indeed. I just want to give the House two brief citations from authorities past. The first states that the,
“principle …enshrined in section 1 of the Compensation Act 2006 … has always been part of the common law”.
That was Lord Justice Jackson in 2010. The following year, Lady Justice Smith—now Dame Janet Smith—in another case in the Court of Appeal quoth:
“Section 1 of the Compensation Act 2006”,
does
“not add anything to the common law position”.
Do we really want our judges, next year or the year after, to have to add to those citations? Nor will Sections 2 and 4 of whatever Act this will become in 2014 or 2015 add anything. That is the position in regard to those clauses by concession. Unlike my noble and learned friend Lord Walker of Gestingthorpe, I do not understand for a moment the Government suggest to that those clauses make the faintest change whatever to the existing law. Clause 3 conceivably raises other, but no less objectionable, considerations. However, Clauses 2 and 4 change nothing.
Lord Beecham (Lab)
My Lords, less than a week ago we debated the Government’s amendments to the Criminal Justice and Courts Bill, and inflicted defeats in relation to proposals affecting young offenders and, even more significantly in terms of their constitutional importance, two changes to the procedures for judicial review.
Today we return to this Bill, a piece of vanity legislation if ever there was one, which, except for Clause 3—as we have heard—adds nothing to the provisions of the Compensation Act 2006, which, by implication, it purports to amend. I concur entirely with the critique of the noble and learned Lord, Lord Lloyd, the noble Lord, Lord Pannick, and others of this muddled attempt to deal with a problem for whose very existence there is a complete lack of evidence—a Bill that is very badly drafted, in any case.
At Second Reading, I acknowledged that the House is properly cautious about declining to give a Second Reading to Bills emanating from the Commons, and there is a similar reluctance totally to destroy Bills in the way in which the amendments of the noble and learned Lord, Lord Lloyd, would achieve if passed, which would leave the Bill consisting of only its title. However, if we were to go so far on a Bill as feeble as this, it would actually strengthen the hand of the Lord Chancellor in relation to the vastly more important and damaging provisions of the Criminal Justice and Courts Bill, which we have sent back to the Commons with our amendments. I fear that he would not hesitate to cast this House as a recalcitrant and obstructive group, placing us alongside the left-wing pressure groups and campaigners which he conjured up as the phantom proponents of judicial review and opponents of his attempts to undermine it. It would, I suggest, make it more unlikely for the Lord Chancellor to exercise political responsibility in relation to the amendments on secure colleges and JR by accepting them, or, should he fail to do so, for MPs on the Government Benches to demonstrate political heroism in a just cause by voting for them.
For those reasons, I regret that I cannot advise opposition Members to support the noble and learned Lord’s amendment to Clause 2, nor his amendment to Clause 4—in any case, the Government have tabled an amendment to it that reflects one moved by the noble Lord, Lord Pannick, in Committee, to which I added my name. I do that with regret because I share entirely the noble and learned Lord’s criticisms of the vacuous nature of the Bill; but it seems to me, for the reasons that I have given, unwise for the House to join him in the Lobbies. I say that with the more trepidation as I understand that he is the chairman of the East Sussex Rifle Association; I fear that I may end up as a target—if not for the noble and learned Lord, then for some of the members of that association.
There is nevertheless a serious issue as to the role of the House in these strange circumstances. However, in relation to Clause 3, I will be asking the House to agree that it should not stand part of the Bill, essentially because that clause seeks to effect a change in the law that is unacceptable for reasons which I will adduce when we come to debate that amendment. However, I fear that I shall not be joining the noble and learned Lord in the Lobby—
Lord Pannick
Is the noble Lord saying that the Opposition are not going to support the noble and learned Lord, Lord Berwick, because, although they think that Clause 2 is absolutely terrible, it is not the worst legislative proposal that Mr Grayling has brought forward in this Session?
Lord Beecham
There is a lot of competition in that respect. I merely say that on this Bill it is not worth the House taking a position that is a departure from its normal practice. I genuinely fear that the Lord Chancellor will use such a vote to muster support against the much more serious amendments that we have sent back for the Commons to consider. That will not help us in sticking to those amendments, should they come back to us. That is why I will not be in either Lobby this evening if the noble and learned Lord decides to test the opinion of the House.
The Minister of State, Ministry of Justice (Lord Faulks) (Con)
My Lords, in speaking against Clause 2 in Committee and in the debate today, the noble and learned Lord, Lord Lloyd of Berwick, has maintained that the clause adds nothing useful to Section 1 of the Compensation Act 2006 or to the existing common law and is therefore unnecessary. I take this opportunity to explain why the Government believe that the clause has an important purpose, which merits the support of the House.
The clause stems from our wish to ensure that people can feel confident about participating in activities that benefit others without worrying about what might happen if something goes wrong and they find themselves defending a negligence claim. Clause 2 sets out to provide valuable reassurance that if that happens, the court will take careful and thorough account of the context of the defendant’s actions when reaching a decision on liability. Rather as the noble Baroness, Lady Ashton, said when introducing the provisions of the Compensation Act, as I have quoted before:
“They will reassure people who are concerned about being sued that, if they adopt reasonable standards and procedures, they will not be found liable”.—[Official Report, 28/11/05; col. 81.]
So two separate Governments have identified a fear.
It is said that there is no solid evidence and that such evidence as there is is anecdotal. I agree with my noble friend Lord Hodgson: it is rather hard to identify and amass solid evidence about this. However, I am not sure that many people would disagree with the proposition that we have a culture where litigation hovers over many activities like a shadow and can genuinely inhibit the sort of things that most people would consider to be desirable.
Lord Forsyth of Drumlean (Con)
Can the Minister help a non-lawyer? Is it the Government’s policy that they are prepared to use legislation to send signals or make declarations of policy? That seems to me what is at the heart of this matter, not whether the courts have found it important to interpret that law as it stands.
Lord Faulks
I think there is something of both, in the sense that very often in the law of negligence, although the principles are clear, when identifying the answer to a particular factual case—one very much on the margins—a great deal of judicial time is spent identifying what is a duty of care, whether there is a breach of the duty of care and whether there is foreseeability. Extracting the principles from the morass of common-law cases is not easy. This Bill sets out in statutory form principles to which a judge may have regard. That is a legal process. It is also not, I suggest, inappropriate for some form of message—I do not like the word “message” but I think everybody in your Lordships’ House knows what is meant by that—or for some sort of guidance and reassurance to be given to the general population, so that they can act in a way they would like to act without the fear of uncertainty that accompanies litigation.
I was addressing the point made the noble and learned Lord, Lord Walker, about the Law Commission. He is right about the immensely valuable role it plays in making the law and how desirable it often is to have a proper review. He would accept, I am sure, that it is not a prerequisite for the making of law that the Law Commission has examined a particular area. In fact, the Compensation Act 2006 followed an inquiry by the Department for Constitutional Affairs. The committee had produced a report—I was a special adviser so I declare an interest—so it was not via the Law Commission. Valuable though that can be, there is a limit to the amount it can do in a particular timeframe because of the immense calls on its services. While not disagreeing with anything the noble and learned Lord has said, it does not, I suggest, prevent there being a change in the law, notwithstanding the fact that the Law Commission has not considered this matter specifically.
I suggest that this is an important, although not radical, declaration of the existing law. It sends an important note of reassurance. I accept that it may not be the most transformative Bill that has reached this House but that does not mean that it does not serve an important function. The noble Lord, Lord Beecham, continued his attack, which I have sustained now for approximately 12 months, on every proposition that the Government have put forward. I normally follow his arguments, which are lucid and clear. On this occasion, I am unable to follow his argument. However, I do not wish to stretch my already stretched synapses even further in an attempt to do so; I will simply accept what he says.
The Archbishop of York
My Lords, I am puzzled. Will the noble Lord tell us whether it is ever worthy to use a statute as a means of giving assurance? I thought that a statute was to state the law, not to assure somebody somewhere. That would be okay. It would be an amazing way of—you know what I mean.
Lord Faulks
I think I know what the most reverend Primate means. With respect, as I said on a previous occasion, describing a statute as sending a message is too simplistic a way of explaining what we do in Parliament. We do not legislate in a vacuum. For example, we identify particular issues, whether they are modern slavery or revenge porn, which became part of an amendment to the Criminal Justice and Courts Bill. We pass laws which serve the purpose of clarifying the law but they also reflect what people in society think we ought to be doing in Parliament. I rely on what my noble friend Lord Hodgson said about the desire for neighbours to be unshackled. We need more volunteers; we need people to be unshackled. This law may make a modest contribution and I ask the noble and learned Lord to withdraw his amendment.
Lord Pannick
Before the noble Lord sits down, perhaps I may ask him whether there is any precedent that he can cite for our legislating not to change the law but to provide reassurance.
Lord Faulks
I am not sure that off the top of my head I can think of a particular legislative provision that provides reassurance, but part of the function of much legislation is to provide reassurance and protection to the vulnerable. There is nothing novel about producing a piece of legislation which, in a difficult area, provides some clarity and a modest degree of reassurance in an area of considerable uncertainty.
Lord Lloyd of Berwick
My Lords, I thank noble Lords who have supported this amendment. I want to say a word about the contribution of the noble and learned Lord, Lord Walker of Gestingthorpe. He said that, as the Bill changes the common law, it ought to have been referred in the first instance to the Law Commission. I entirely agree that from time to time it has not been at all easy to discover what the government case has been, but their final position is that it does not change the common law in any way; it merely confirms what was already the common law and what was included as Section 1 of the Compensation Act 2006. I hope that that answers the noble and learned Lord’s difficulty.
So far as the rest is concerned, I shall say nothing more about the arguments put forward by the noble Lord in answer to the debate. They have already been dealt with very fully. However, I want to say a word about the attitude of the Opposition to the amendment. As I understood it until 2.15 pm this afternoon, the Opposition would be supporting the amendment. That was my clear understanding.
Lord Beecham
If the noble and learned Lord understood that, he misunderstood it, and if I have contributed to a misunderstanding, I apologise. It was never the Opposition’s position that we would support the noble and learned Lord. We were considering the position and I tried to contact him unsuccessfully over the weekend. Therefore, we have not resiled from the position that we previously adopted.
Lord Lloyd of Berwick
I am quite happy to accept that there must have been a misunderstanding. However, that was certainly my understanding of the position, just as my understanding of the position at Second Reading was that they would be supporting my amendment. I was wrong about that and I am wrong again. However, that still leaves the question of why on earth the Opposition are not supporting the amendment. After all, on the whole, it is the duty of the Opposition to oppose. If they found that they were against something—and I understood them to be against Clauses 2 and 4, just as they are against Clause 3—in the ordinary way they would oppose it.
However, I am wrong about that. The reason given for this seems to me to be entirely incomprehensible. The reason why the Opposition now do not want to oppose Clauses 2 and 4 is that if they did so while opposing Clause 3, that would then have some effect—which I really did not understand—on the attitude of the Lord Chancellor in relation to some other Bill; namely, the Criminal Justice and Courts Bill. That is a wholly irrational ground for an Opposition to act on. I would have thought it their duty, if they are against Clauses 2 and 4, to oppose them. They say, however, that, for reasons which I do not understand, they do not intend to take that view officially. I hope that at least some members of the party which is represented by those on the Opposition Front Bench who take that view will think differently.
Lord Cormack (Con)
My Lords, surely my noble and learned friend, as I will call him on this occasion, has heard of the mugwumps, who sat on the fence with their mugs on one side and their wumps on the other.
Lord Lloyd of Berwick
I am not sure that I fully understood. Perhaps I did not wholly hear what the noble Lord said. However, the arguments are now over, and there is really nothing left for it but to take the opinion of the House. I do not fancy for one moment that, in the absence of support from the Opposition on this clause, the amendment will be carried. However, in the interests of doing the right thing—those words which the Lord Chancellor kept on using—I ought to take the opinion of the House, which I now seek to do.
Lord Hodgson of Astley Abbotts
My Lords, Amendment 1A may be less controversial than the matter that we have just finished discussing, although in matters of the law you never quite know. The amendment was originally tabled in the name of my noble friend Lord Hunt of Wirral, and I added my name to it. My noble friend has had to travel to northern England today on business, so is unable to be here in time to move this amendment. I am moving it on his behalf.
The amendment is very simple: a one-word change to Clause 3, the clause entitled “Responsibility”, to which the noble Lord, Lord Beecham, referred earlier. It replaces “generally” with “predominantly”, so that the clause will read:
“The court must have regard to whether the person”,
demonstrated a “predominantly”,
“responsible approach towards protecting the safety or other interests of others”.
The question was whether the use of “generally” was sufficiently focused to achieve the appropriate balance in individual cases. The adverb “generally” has three definitions in the Collins English Dictionary. The first is “usually; as a rule”. The second is “commonly or widely”. The final one is,
“without reference to specific details or facts; broadly”.
I suspect that what your Lordships’ House will wish the courts to consider, if this Bill passes into law, is whether the defendant will first claim that he was demonstrating an approach which on that occasion was in the main responsible in protecting the safety of others as opposed to the approach which usually, but not necessarily on that occasion, was responsible. Replacing “generally” with “predominantly”—we return to the Collins English Dictionary definition, which is,
“for the most part mostly and mainly”—
should provide the courts with the power to examine the approach of the defendant at the material time and avoid them having to consider the approach demonstrated at other times or taking the matter even wider, enabling them to take into account the approach followed other than that at the material time.
This Bill has an important role to play in reassuring potential volunteers, but equally it should not encourage behaviour which is thoughtless or irresponsible and thus puts others at risk. This change of word may better balance the two aspects, and I hope that the amendment will find favour with my noble friend. I beg to move.
Lord Beecham
My Lords, Clause 3 is the one clause in the Bill which the Government acknowledge embodies a substantive change in the law. In Committee, I moved an amendment to remove “generally” from the requirement on the court to consider whether,
“the alleged negligence or breach of statutory duty … demonstrated a generally responsible approach towards protecting the safety or other interests of others”.
Neither at Second Reading nor in Committee did the Minister define the meaning of “a generally responsible approach”, and in replying to the debate in Committee he acknowledged that the term was “unusual” in statutory terms. Indeed, he indicated that he would,
“consider carefully whether and to what extent it adds anything to what is in the clause at the moment and whether, on balance, it takes the matter any further”.—[Official Report, 18/11/14; col. 414.]
We await with bated breath the outcome of the Minister’s deliberations along with his response to the amendment tabled by his noble friend, who is seeking to ratchet up “generally” to “predominantly” in the proposed clause.
I have to say that neither term is satisfactory in terms of either definition, which is entirely lacking, or effect. Why should someone suffering damage through an act of negligence or breach of statutory duty be denied compensation on the grounds that the act or omission was in effect a first offence, or at any rate a rare offence? What, for that matter, constitutes a “responsible” approach? How does the Minister define those terms? Moreover, and crucially, the clause is not limited to social action, responsibility or heroism, terms which are in themselves undefined and undefinable, or to personal injury cases. We are dealing not just with safety but, in terms of the clause, with other interests. As I reported in Committee, the Minister in the House of Commons, Mr Vara, affirmed that the clause,
“could in principle be applicable in relation to other instances of negligence such as damage to property or economic loss where issues of safety may not necessarily be relevant”.—[Official Report, Commons, 20/10/14; col. 693.]
Why should a negligent builder, medical practitioner, accountant, surveyor or even solicitor—I declare my interest—escape liability for what might even be catastrophic damage because he has been hitherto “predominantly” responsible? Negligence can lead to large losses outside the realm of personal injury. Is not the reality that this badly drafted clause is yet another concession to the insurance lobby, which ordinarily would of course stand behind the defendant in such claims?
Many Members of your Lordships’ House will have received an e-mail today from one of those pressure groups which so exercise the Lord Chancellor in relation to judicial review. In this case, the pressure group is one which we can be confident he entirely approves of: it is the CBI. Its curiously worded communication supports Clause 3 on the grounds that it,
“provides better protection against accidents for those firms—particularly the small and medium sized companies that already have good health and safety processes in place”.
Of course, it does nothing of the sort. It provides “better protection” against claims for negligence arising from accidents and it extends, of course, to large employers as well as medium-sized and small employers.
The e-mail goes on to suggest that,
“this clause will encourage the courts to recognise that safety is a shared responsibility”,
as if the courts do not already do so, and do not make findings of contributory negligence when a claimant fails to take proper precautions, or dismiss a claim when he is wholly responsible. Of course, again, the CBI ignores the fact that the clause extends to all types of negligence, including by small and medium-sized businesses which might well find themselves a victim of negligence other than of the kind leading to personal injury.
As the CBI’s response eloquently exemplifies, this whole Bill has all the hallmarks of being drafted by the Lord Chancellor on the back of a small envelope. This clause, in particular, is deeply objectionable. Unless the Minister is prepared to abandon the clause, I shall invite the House to divide and consign the envelope to the parliamentary waste bin.
Lord Pannick
My Lords, I add my support to what has been said by the noble Lord, Lord Beecham. Clause 3 is very troubling for two reasons. First, the defendant may have shown a partially irresponsible approach towards protecting the safety or other interests of others, that partially irresponsible approach may be the cause of the accident and it may be entirely inexcusable. Why, then, is the generally responsible approach of the defendant in other respects of any relevance whatever? The amendment in the name of the noble Lord, Lord Hodgson of Astley Abbotts, would not cure this defect.
The second troubling aspect of Clause 3 is that it does not appear to be confined to the subject matter of the Bill, social action and heroism. I would be very grateful if the Minister would explain whether Clause 3 was intended to be confined to the subject matter of the Bill, or whether, as its wording suggests, it is to have a broader aspect. For these reasons, if the noble Lord, Lord Beecham, divides the House, he will have my support.
Lord Goldsmith (Lab)
My Lords, I support what has been said by my noble friend Lord Beecham and by the noble Lord, Lord Pannick. As a practising lawyer, the idea of having to bring this into effect and applying it in the context of an actual case fills me with horror. I do not know how one would start to go about it. I do not see the benefit the clause brings and I see grave dangers in its application. I was particularly taken by the comment of my noble friend Lord Beecham that this does not even necessarily apply to cases of personal injury or injury of that sort—it can apply to economic loss and to many other sorts of cases. I do not see how this sort of drafting can conceivably be appropriate for such cases.
Lord Woolf (CB)
Will the Minister, when he comes to reply, assist me? I do not see how this clause will apply if there are two defendants, one of whom has shown a generally responsible approach towards protecting the safety or other interests of others and the other who has not exercised that approach. It seems to me to be very worrying from that point of view. I always understood that it is not your general behaviour that the court has to look at in order to find whether you are negligent but your behaviour on the particular occasion when you are said to have committed a tort. If one is going to look at the person’s general behaviour in deciding actions for tort, these are going to take a lot longer to resolve than they have hitherto.
Lord Brown of Eaton-under-Heywood (CB)
My Lords, I, too, support this amendment. The Bill as a whole is manifestly directed—all the earlier debates have indicated this—to encouraging people to volunteer and take part in generally beneficial activities. As the noble Lord, Lord Beecham, made plain, this clause would apply if you have a claim against your accountant. Perhaps he is a wonderful accountant and has looked after everybody else enormously skilfully over the years, but on this particular occasion when he is looking after your affairs, Homer nods, falls fast asleep and costs you an enormous amount of money, for whatever reason—perhaps he was going through a messy divorce at the time. He is insured. Is it really to be suggested that what he has done for everybody else is relevant and can deprive you of your claim? It is absurd.
Lord Hope of Craighead
My Lords, another feature of this clause occurs to me: how one is supposed to apply it when the issue of contributory negligence comes up. This is one of the problems that the court must have regard to, but we are not told in this very brief provision to what purpose one is examining. I assume that it is whether the individual or body concerned is liable at all, but assuming it is liable, how does one apply it in the context of contributory negligence? I do not believe that that aspect has been thought through at all.
Lord Faulks
My Lords, we have had the pleasure of a short but informative debate this afternoon. The criticism of Clause 2 was that it did not change the law and therefore was not desirable, but the criticism of Clause 3 is that it does change the law—so I will approach the Bill in a rather different way.
The amendment in the name of the noble Lord, Lord Beecham, would remove Clause 3 from the Bill entirely. I would like to explain to the House why I believe that it is important for the clause to remain part of the Bill. It provides that a court, when considering a claim for negligence or breach of a relevant statutory duty, such as, for example, under the Occupiers’ Liability Act, must have regard to whether the defendant, in carrying out the activity in which the alleged negligence or breach occurred, demonstrated a “generally”—I put that word for the moment in inverted commas—responsible approach towards protecting the safety or other interests of others.
The core aim underlying this clause, and the Bill as a whole, is to provide reassurance to ordinary, hard-working people who have adopted such an approach towards the safety or other interests of others during the course of an activity, that the courts will always take this into account in the event that something goes wrong and they are sued. As well as providing that reassurance, we hope that this will also give them greater confidence in standing up to those who try to bring opportunistic and speculative claims by showing them that the law is on their side.
As I explained at Second Reading and in Committee, we believe that concerns that the clause might in some way undermine the rights of employees and others to bring a negligence claim are unfounded. There is nothing in Clause 3, or in the Bill more generally, which will prevent somebody who has been injured bringing a claim or which will prevent the court finding an employer or any other defendant negligent if the circumstances of the case warrant it.
In addition, the focus of the clause is on whether a generally responsible approach was adopted in the course of the activity—so that we are not looking, as the noble and learned Lord, Lord Woolf, suggested, at the whole of the behaviour in other circumstances or in relation to some other activity—in which it is alleged that the negligence occurred. It will not therefore enable a body with a slipshod approach to safety to escape liability by pointing to its health and safety record over a longer period of time. If its actions during the course of the activity in question were so risky or careless as to be negligent, it can still be found liable.
The need for this measure is amply illustrated by the evidence that was provided in support of the Bill during its passage through the House of Commons. I have referred to evidence from voluntary organisations that concerns over liability continue to represent a real disincentive, preventing many people getting involved in socially worthwhile activities. Evidence provided by the emergency services also illustrated the propensity of some people involved in accidents to bring opportunistic and, frankly, spurious claims, such as the example we have previously discussed provided by the Cheshire Fire & Rescue Service.
Lord Woolf
I am grateful to the Minister for giving way. I still, I am afraid, cannot understand whether, where there are two defendants, one who can rely on this Clause 3, and one who cannot rely on it, he is saying there could be a situation where it would be proper for a judge to say that one defendant walks out of court scot-free, even though he caused the accident, and the other is found guilty.
Lord Faulks
The answer is yes. There are lots of different circumstances in which two defendants may find themselves sued. They may be sued on the basis that one is much more likely to be liable than the other. The other defendant may be sued because his insurance arrangements may be considered more satisfactory. There will be circumstances in which one defendant is much more likely to be culpable than the other—in which case very often there will be, pursuant to the 1970 civil liability Act, a division of responsibility between those two defendants. A judge will have to perform that process.
By the same token, a particular defendant in a factual scenario, where an accident is caused, might have, on a particular day, been wholly reckless about the cause of the accident insofar as that particular defendant is concerned. Another defendant might have been predominantly or generally extremely careful for the welfare of that individual. I am not saying that that is necessarily a likely scenario, but it is certainly one within the realms of the many possibilities of claims that the noble and learned Lord and I have been involved in, where a judge has to pick his way through a number of different defendants and try to find a fair answer on the facts. My answer to him is that that particular process, difficult though it is, performed by skilful judges, will not be made significantly more difficult by these provisions.
As I explained earlier, the approach that we have taken does not rewrite the law in detail, but it represents a change to the law in that it does not currently oblige a court to consider whether a person took a generally responsible approach to safety during the activity in question. We wish to ensure that the courts take a slightly broader view of the defendants’ conduct in these circumstances, by looking at whether his approach to safety, taking into account all that he did or did not do, was generally a responsible one. I suggest that that would very much tally with what a number of members of the public might think was fair. If a defendant was really predominantly doing all that he or she could reasonably be expected to do to look after the safety of an individual, why should there not be some reflection of that fact in the determination of liability? Why should it be ignored altogether? The court would be obliged to weigh it in the balance—that is all—when considering the ultimate question of whether the defendant met the required standard of care.
Lord Pannick
Is there some time period over which the court is expected to assess the generally responsible approach of the defendant? How far does this go back? Has the department made any assessment of how much longer court cases are going to take and how much more expensive they will be if the judge has to assess all those matters?
Lord Faulks
With great respect to the noble Lord, considering the activity in question focuses the judge on the activity that is said to have caused the particular injury, or tort, which has eventuated.
Lord Faulks
Perhaps I could finish answering this question before I answer the next one. That would necessitate a judge looking at the activity in question and deciding whether, in relation to the activity in question that is being examined by the court, a generally responsible approach was exhibited by the defendant. What that would not involve would be going through his or her safety record for the previous 10 years, if that is what is being suggested. In fact, as the noble Lord may or may not know from personal injuries claims, very often disclosure of the history of accidents in a factory or documents on previous injuries is done in conventional personal injury claims, as the law is now—there is nothing different about that. So with great respect I do not accept the noble Lord’s suggestion that there would be a lengthening of trial or a greater complication in those terms.
Lord Beecham
The Minister must forgive my impatience again. He has concentrated on personal injury claims, but he would concede that the clause does not restrict itself to such claims. Could he identify some of the other sorts of cases, as his ministerial colleague did in the House of Commons, the non-personal injury cases—contract cases and matters of that kind? Would he say that, if a defendant had demonstrated an approach towards protecting the safety of his staff, that suffices to let him escape from damage to other interests of others? What sort of other interests do the Government intend to be covered by the provisions of the clause?
Lord Faulks
The Bill is described in its preamble as being to make,
“provision as to matters to which a court must have regard in determining a claim in negligence or breach of statutory duty”.
I do not see any reference to breach of contract there. But the noble Lord is right in the sense that Clause 3 refers to,
“a generally responsible approach towards protecting the safety or other interests of others”.
That would open the door to the possibility of other interests being considered. Having regard to the general structure of the Bill, I would not wish to add anything to what was said in the House of Commons. I imagine that it is going to be focused primarily on conventional personal injury cases.
Lord Goldsmith
I am sorry, but I wonder how the noble Lord can make that observation. If a claim comes before the courts, where there is an allegation of breach of statutory duty or negligence, which as he would readily concede could be negligence arising from a contract, how is that clause to be avoided? For example, the accountant says, looking at the wording of Clause 3, “The activity that I carry out is doing people’s tax returns and advising them on that; I have done it for the last 10 years and I am now going to tell the court about my record”. How do the words in the clause prevent that from being done?
Lord Faulks
Let me deal with the hypothetically negligent accountant. As I said in answer to previous questions, the Bill is concerned with the activity in question, so it would be the particular tax return or the particular piece of advice, because that is what the Bill says.
Lord Goldsmith
It would not be this tax return, surely, but the activity of advising on tax returns generally.
Lord Faulks
I respectfully disagree with that interpretation because it is concerned with the activity in question,
“in the course of which the alleged negligence or breach of statutory duty occurred”.
It would not, therefore, deal with the 99 years of accurate tax returns but would focus on the particular tax return that is the subject of the claim in negligence. That is the correct interpretation of the particular clause.
I will answer the question that I hear from a sedentary position: how do we deal with the question of “generally”? My answer to that is that the “generally responsible” approach is directed at the activity in question. It is difficult to see, frankly, that it would have much of an application on the hypothetically negligent accountant—
Lord Faulks
Perhaps I may finish answering this question before I answer the next one. The hypothetically negligent accountant—if he or she has made a negligent error—is going to be liable. This is not going to add anything to that position. It would be no good for them to say, “In the 99 other years in which I did this particular act, I did a good job”, because that just would not bite on this. It does not seem to me that it is very likely that, on the particular hypothesis that the noble and learned Lord put forward, it would have any application.
Lord Hope of Craighead
I am grateful to the Minister for giving way. I wonder whether the Minister could be more precise. He talked about the activity in question, but surely Clause 3 has to be read in the light of Clause 1. The whole of this brief Bill is introduced by Clause 1, which tells us:
“This Act applies when a court … is determining the steps that the person was required to take to meet a standard of care”.
Surely one needs to be very precise if one is to understand Clause 3; it is talking about the steps that the person was required to take. It may be that the court is saying, “Well, I am not going to find that the defendant was bound to take that step because I am applying Clause 3”. It is either yes or no, I would have thought. Using the phrase, “activity in question” is far too general. If it is to mean anything, it has to be precisely focused on what Clause 1 is talking about, and the rest will then follow—rightly or wrongly.
Lord Faulks
Clause 1, in answer to the noble and learned Lord, is describing the scope of the Act, saying that it applies when a court,
“in considering a claim that a person was negligent or in breach of a statutory duty, is determining the steps that the person was required to take to meet a standard of care”.
It then gives, in the three clauses that we are considering this afternoon, three different factors that should be taken into account—or rather, it says that the court must “have regard” to them. Clause 1 is very much scene setting. However, to turn the argument on its head: if, for example, Clause 3 did not have the expression,
“in carrying out the activity in the course of which the alleged negligence or breach of statutory duty occurred”,
the argument might be stronger, because it could be said that the court must have regard to a generally responsible approach towards protecting the safety of others. Then it could be argued that this is invoking somebody saying “I am normally a conscientious surgeon”, or “I normally look after people in the factory”. However, the very fact that those words are inserted is focusing the court’s attention on the particular activity in question. With respect, therefore, that is my answer to that question.
I submit, of course, that this makes a modest and sensible change, but it is important to bear in mind that the court is only invited to “have regard” to it. If the court thinks that, frankly, notwithstanding a generally or predominantly responsible approach, this particular failure—if such there be—is not acceptable, it will decide on normal principles that there has been a breach.
Lord Beecham
I have another question. The Minister’s colleague, Mr Vara, said:
“Narrowing the clause … would mean that … bodies such as voluntary organisations, religious groups or social clubs which demonstrate a generally responsible approach towards protecting the safety or other interests of their clients or members would not be able to benefit from its provisions. That cannot be right”.—[Official Report, Commons, 20/10/14; col. 693.]
That is the argument that he made in opposing an amendment which had been tabled. That seems to suggest that the Government were contemplating situations in which such organisations would be protected in the course of their general functions in the event of a claim arising—rather than, as the noble Lord implied, only in relation to a particular case in which they failed, as it were, to have sufficient regard to the safety or other interests of a client. Surely the noble Lord is in error in advancing the argument that we are looking only at the particular individual who might be involved in such a claim. That seems to me much too narrow an approach to the terms set out in the Bill.
Lord Faulks
I do not have the full context of what my ministerial colleague said in the House of Commons, but I do not believe that I am in error when I give the reasons for my answers to the various questions that have been posed. As I say, these words are not mere surplusage; they are put in to clarify and limit the extent to which “generally responsible” has an application.
I suggest that this provision is an important but modest reflection of what many people would say was a sensible encouragement of employers to adopt a predominantly or generally responsible attitude to the safety or other interests of others—but which, in appropriate circumstances and subject to the court’s overall discretion, allows these matters to be taken into consideration. That is as far as it goes. It is a modest but, I suggest, sensible addition to the law—and it is an addition to the law, as I think is accepted. Given the clarification I have attempted to give the noble Lord on the limit of the measure’s scope, I invite him to withdraw his amendment.
Lord Hodgson of Astley Abbotts
My Lords, I am grateful to my noble friend for returning to Amendment 1A. I thought for a moment that it had been forgotten in the heavy-duty exchange of legal artillery that was flying across the Chamber. I am also grateful for his reassuring remarks about the possibility of something further being introduced along the lines of “predominantly” if the Bill survives the challenge from the noble Lord, Lord Beecham. In those circumstances, I am happy to withdraw the amendment.
Lord Beecham
Lord Beecham
My Lords, on this occasion I will not follow the precedent of the noble Lord, Lord Hodgson. The Minister has not satisfactorily explained the real purpose or the workings of this clause, although the two things may not coincide in the minds of those who drafted it. It represents a substantive change and, in his noble efforts to minimise the extent of that change, I fear that he has failed to address the new concerns raised by several Members of this House who are much more learned in the law than I would ever profess to be. In these circumstances, I wish to test the opinion of the House.
Lord Faulks
Lord Faulks
My Lords, I turn now to Clause 4 and the amendment we have tabled relating to it. We noted the concerns raised in Committee by the noble Lords, Lord Aberdare and Lord Pannick, and my noble friend Lord Attlee that the current definition of “heroism” could be taken to exclude the actions of trained first aid volunteers. That is because the current clause says that a person acts heroically if he intervenes to help somebody in danger without regard to his own safety or other interests. Organisations such as St John Ambulance and the British Red Cross would always train their volunteers to have regard to the potential risks to themselves and others before intervening.
I had a very constructive meeting with representatives from those organisations after Committee to discuss these matters further, which culminated in the amendment that we are bringing forward today. We agreed that the simplest thing to do would be to remove the final 11 words of the clause. This will put beyond doubt that the clause applies to anybody who intervenes in an emergency to help somebody in danger, regardless of whether they acted entirely spontaneously or weighed up the risks before intervening. What is more, St John Ambulance and the British Red Cross, as leading first aid organisations reaching hundreds of thousands of people a year, have said that if the amendment is agreed they will use the opportunity to encourage more people to come forward to act in emergencies. I am very grateful to them for their offer of assistance, which will help to reassure many new first aid volunteers that they can intervene in emergencies secure in the knowledge that the law will be on their side. I beg to move.
Lord Lloyd of Berwick
My Lords, I also have an amendment in this group. It may be convenient if I say what I have to say now. In many ways, Clause 4, which we are now dealing with, is the oddest of these three clauses. As drafted, it was strongly criticised by the Fire Brigades Union, St John Ambulance and the Red Cross, among others. To take the instance of the Fire Brigades Union, the clause goes directly contrary to advice that it has given for many years to people involved in a fire: to get out of the way of the fire as quickly as they can and to stay out. If they intervene to try to rescue somebody, then they are only likely to put in greater danger the firemen, who will have to come to their rescue as well.
This was pointed out as a difficulty—indeed, as a serious objection—in the other place, but no notice was taken of that criticism until at a very late stage in this House, when the noble Lord, Lord Faulks, gave notice of his amendment to leave out the last 11 words of the clause. Leaving out the last 11 words of this clause is undoubtedly a great improvement, but leaving out half a clause to save the rest of a clause is an unusual thing to do. It only demonstrates that the clause, like the rest of the Bill, was never properly thought out in the first place. In Committee I suggested that it looked like a clause drafted on the back of an envelope. I now think that that may be going too far in its favour. It must surely have occurred to someone at some stage that a clause that protects someone who takes no thought for his own safety, but does not protect someone who takes some thought for his own safety—that, as it was put elegantly, as always, by the noble Lord, Lord Pannick,
“protects the instinctive hero but not the thoughtful hero”—[Official Report, 18/11/14; col. 416.]
—is surely inherently ridiculous. Be that as it may, the objection to Clause 4 is essentially the same as that to Clause 2. The substance of Clause 4, as it will stand if the noble Lord’s amendment is accepted, is already covered by Section 1 of the Compensation Act 2006.
It is difficult to imagine a,
“person … acting heroically … to assist an individual in danger”,
who is not by that very act engaged in a “desirable activity” as envisaged by Section 1 of the Compensation Act. If so, this clause adds literally nothing to the existing law. If the noble Lord in his reply can think of a single example where the point I have made is not valid because something would be covered by this clause and not by Section 1 of the Compensation Act, I hope he will tell us. In the mean time, I submit that it adds nothing and should be rejected on that ground. In due course I will move my amendment too.
Lord Pannick
My Lords, there is a further reason why Clause 4 is pointless and that is, of course, because it adds nothing to Clause 2. It is very difficult to understand in what circumstances a person is acting heroically in an emergency when they are not also,
“acting for the benefit of society or any of its members”.
Perhaps the Minister can tell the House of a theoretical case that would not fall within Clause 2 that falls within Clause 4. There is no doubt that the removal of the final words of Clause 4 is a distinct improvement. We must be grateful for small mercies.
I have a further concern that when courts have to apply Clause 4 there is ample room for no doubt lengthy debate as to what is meant by “heroically” and “emergency”, neither of which is defined in the Bill.
Lord Brown of Eaton-under-Heywood
My Lords, I, too, support the amendment tabled by the noble and learned Lord, Lord Lloyd, for the same reasons as I indicated in respect of Clause 2. It adds nothing. If you ask a simple question whether there is a court in the land which would not, under the common law,
“have regard to whether the alleged negligence or breach of statutory duty occurred when the person was acting heroically by intervening in an emergency to assist an individual in danger”,
the question answers itself—of course there is not. I ask the Minister to say what is added by the words “acting heroically by”. Why could it not just be, “when the person was intervening in an emergency to assist an individual in danger”?
Apart from ramping up the rhetoric—that is essentially what this whole business is—what actually is added by “acting heroically by”, except for another hour of the court’s time if eventually it has to apply this clause?
Lord Walker of Gestingthorpe
My Lords, I support the amendment which my noble and learned friend Lord Lloyd of Berwick has indicated that he is likely to withdraw. I wish to address briefly the amendment proposed by the Minister and draw attention to the use of language in both Clause 4 and throughout the Bill. I am genuinely shocked by the low standard of draftsmanship in the Bill—presumably it was prepared by government lawyers. It is an elementary principle of statutory drafting that one unit of meaning should be described by one word—that words should not be used interchangeably as the draftsman’s fancy takes him.
Lord Hodgson of Astley Abbotts
My Lords, I, too, congratulate the Government on leaving out the 11 words at the end of this clause. Particularly following our debate in Committee, it appeared to me that a “person’s own safety” is not necessarily a part of heroism, so it is a useful removal.
The noble and learned Lord, Lord Lloyd, in speaking to his amendment to leave out the clause, said that his reasons for wishing to do that were broadly the same as his reasons for tabling Amendment 1, which concerned Clause 2. I understand that, and therefore draw the conclusion that I drew a couple of hours ago. I hope that my noble friend will resist that amendment.
Lord Beecham
My Lords, the noble and learned Lord, Lord Brown, asked what was added by the reference to heroism in the Bill. The answer is that it allows the Government to bestow an acronym on the Bill; otherwise, it would simply be the “Social Action Responsibility Bill”. Now, we have the words “and Heroism”, which make a convenient acronym. That is an interesting way of proceeding with the drafting of legislation and I concur with the noble and learned Lord’s criticisms of that process.
Having said that, the Minister has at least made a concession by, in effect, accepting the amendment moved by the noble Lord, Lord Pannick, to which I subscribed, as I said before. It was of some comfort that St John Ambulance, which was certainly in touch with me and, I suspect, other noble Lords, welcomed that change. The clause does not substantially affect anything, as we have already heard. However, in so far as this modest change makes it marginally more palatable, I welcome the Minister’s concession. He has not been able to offer too many concessions, but I am glad that he has prevailed on the Lord Chancellor on this occasion to make a gesture of an unfamiliarly generous kind to this House. I support the amendment.
Lord Faulks
My Lords, for the most part the Government’s amendment has been supported. The noble and learned Lord, Lord Lloyd, says that the fact that we had to remove nearly half the clause, because half of it was not worth while, indicates that the clause really was not worth while. That may not do entire justice to his argument, but we say that we responded to the burden of the argument. We listened to the debate and we consulted St John Ambulance. We certainly do not want to do anything that does not realise the main objective of the Bill, which is to encourage people to volunteer, to assist and to provide, if necessary, emergency assistance.
The Government will no doubt take very much to heart the criticism of the use of language made by the noble and learned Lord, Lord Walker. I explicitly do not promise to make any changes before Third Reading but I undertake to revisit the issue in case any further clarity can be attained by the use of “person” or “individual”.
However, I would say to anyone who is not a lawyer that Clause 4 is pretty clear. It states:
“The court must have regard to whether the alleged negligence or breach of statutory duty occurred when the person was acting heroically by intervening in an emergency to assist an individual in danger”.
I am really not sure that that is a terribly difficult concept to understand. I think that men and women would understand what was meant to be conveyed by that, and it is perfectly reasonable to ask the court to pay regard to it. The noble and learned Lord, Lord Brown, may well be right that judges would take that into account. Certainly most judges would.
However, the outcome of any negligence case, as those of us who have laboured in that particular vineyard will tell the House, is never clear, particularly when there is a very badly injured claimant. Judges sometimes do not sufficiently bear these matters in mind. The court must now “have regard”—that is all we ask—to whether there is heroism as described. We do not believe that heroism needs further definition or examples. We think that judges should be able to recognise it when they see it.
I submit that, while taking on board the criticism of some aspects of the drafting, this very much maligned Bill and this clause serve a sensible, common-sense purpose, and I ask the noble and learned Lord not to press his amendment.
Lord Lloyd of Berwick
Before the noble Lord sits down, I wonder whether he would just deal with the principal point made both by myself and by the noble Lord. In what respect does this clause add anything to Clause 2, as it will now stand part of the Bill, or to Section 1 of the Compensation Act 2006? Will he please give us one single example?
Lord Faulks
I will give the same answer that I gave in relation to the distinction between the Compensation Act and this Bill, which is that the Bill says that the court “must have regard”. That is a distinction. I said in Committee that there may well be an overlap between Clauses 2 and 4. I do not say that they are wholly distinct; they convey an accumulation of concepts which are readily understood, and a judge may find it possible to bear in mind both Clause 2 and Clause 4. That fact does not mean that Clause 4 cannot, in appropriate circumstances, serve a useful purpose.
Baroness Warnock (CB)
Before the noble Lord sits down, will he answer the question raised by my noble and learned friend regarding what exactly the word “heroic” adds to Clause 4? Could it not be left out? Intervening for the sake of saving somebody is surely enough. Is there any reason for having “heroism” or “heroically” either in the Title of the Bill or in Clause 4?
Lord Brown of Eaton-under-Heywood
Before the Minister answers that, the words that are completely surplus here are “acting heroically by”. Why can it not read, “was intervening in an emergency”? Can the Minister whet our appetite as to whether there is any scenario when you can intervene in an emergency and so on, within the meaning of this clause, without acting heroically? If not, for heaven’s sake get rid of it.
Lord Faulks
The answer is that the word is used in the clause to describe a particular circumstance which I think would convey to most people exactly what is intended by that clause. Yes, there may be some circumstances in which it is surplusage, and others when it is useful to describe what is said. I am afraid that the criticisms have now been made, and I have given answers to the questions. It is a matter for the House to decide whether they are satisfactory.
Lord Lloyd of Berwick
Lord Lloyd of Berwick
I am not sure whether I am entitled to say anything more. I do not intend to do so, except to draw attention to the fact that we have not been given any explanation of how Clause 4 adds anything of any utility. However, for reasons best known to themselves, the Official Opposition have decided not to support this amendment. In those circumstances, there is little chance of a result different from that which we had earlier this afternoon. I therefore do not intend to take the opinion of the House.
UK Armed Forces in Iraq
(10 years ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Astor of Hever) (Con)
“My Lords, the UK is currently providing substantial support to the Government of Iraq through airstrikes, surveillance, gifting and transporting equipment and the training of Iraqi forces in specialist skills. There are currently around 50 UK personnel working with the Danes in Sulaymaniyah, in northern Iraq, carrying out combat infantry and sharpshooter training. We are coming to the end of the second of four three-week courses. We also have around 10 military personnel in Erbil looking at how we can assist the Government of Iraq in training and equipping other Kurdish forces.
The international coalition is developing its plan for building the capacity of Iraqi security forces. The US envisages a coalition effort across at least four sites in Iraq. Any future UK training contribution would be absorbed into this coalition plan. In early November, I announced our intention to provide further training to the Iraqi military. No decisions on troop numbers, units or locations have been made, although we expect to focus on providing expertise in countering explosive devices.
At Defence Orals on 24 November, I also announced our intention to advise and assist the Iraqi armed forces through the secondment of advisory personnel to command headquarters, and we are considering what contribution we can make. The details of any decision will be announced to Parliament in the usual way”.
Lord Rosser (Lab)
I thank the Minister for repeating the Answer given to the Urgent Question asked in the other place earlier today. The thrust of the Answer appears to be that the headlines in yesterday’s papers—in the Sunday Times, the Sunday Telegraph, the Mail on Sunday and the Sun, for example—which said that hundreds of British troops are going back to Iraq are wrong. Are the Government saying to us that these headlines, which appeared in a number of newspapers close to the Government, have just been made up, and have not come as a result of comments made by an inside source, whether injudiciously or otherwise?
The Secretary of State for Defence was quoted as confirming that our Armed Forces would be deployed to four separate sites in Iraq next month to train Iraqi and Kurdish soldiers, and that the training we are going to be offering in January will be in infantry skills and some of the basics, particularly on how to deal with IEDs. The Ministry of Defence has been quoted as saying that decisions on numbers, units or locations have not been made. How long will it be before decisions are made on this issue of providing further training? This will also show just how accurate or otherwise the apparently speculative leaks in yesterday’s newspaper reports were. Bearing in mind what the Government have said about not involving combat troops, what will be the size and composition of the force protection element of the training mission? What is the nature of the requests for further help that have come from the Iraqi Government?
We have supported steps taken by the Government, regional partners and the international coalition in combating ISIL. Do the Government not accept that rather greater clarity is now needed about the role of our Armed Forces in Iraq, the scale of their involvement, and the timeframe of training operations? Would they agree that the public, our Armed Forces and Parliament are entitled to be told about this directly by the Government, rather than via what appears to be a leak—from whatever source—to the media?
Lord Astor of Hever
My Lords, I assure the noble Lord that we have no plans to send hundreds of soldiers to Iraq, and never did have such plans. The UK is already making the second largest contribution to air strikes and surveillance after the United States. Our training effort in Iraq will be small scale and niche, building on the UK’s strength in areas where we are best able to support the coalition. This will be a very limited mission. Our Prime Minister has made it very clear that we are not going to recommit ground combat forces to Iraq. As the Iraqi Prime Minister himself said on 17 September, the Iraqi Government do not want to see foreign troops fighting on the ground.
The noble Lord asked how many people we are sending. At the moment, I cannot tell the House very much. We have not set a number, but it will be very low. It will be mainly specialists with niche skills, such as counter-IED. That is something in which the British Army has excellent specialists. We will also be advising the Iraqi army on how to manage its headquarters. We have no plans to send in ground combat forces.
The noble Lord also asked what further help the Iraqi Government have asked for. We are in discussions with the Iraqi Government. It is the Iraqi Government who have requested help from us. The Secretary of State was in Iraq last month, and discussions are continuing to take place.
Lord Jay of Ewelme (CB)
My Lords, I am grateful to the Minister for repeating the Statement made in the other place. Could he say something about the effect of the assistance given so far to the Iraqi Government in deterring or curbing the activities of ISIS?
Lord Astor of Hever
My Lords, we are confident that it is working. We have a very active training programme, which I can tell the noble Lord about. We are carrying out training on heavy machine-guns and combat infantry training. We feel that any training of this sort will help the Iraqi security forces to train up to combat ISIL.
Lord King of Bridgwater (Con)
Is my noble friend aware that the House will be grateful that he clarified the point that there is no intention to put in combat troops, because clearly misunderstandings arose over that? It is helpful to have that cleared up. In respect of the question asked by the noble Lord, Lord Jay, what sort of numbers are going through this training programme, and what sort of length is it? Obviously, in some respects, getting greater expertise and skill within the Iraqi armed forces at this time is a matter of some urgency.
Lord Astor of Hever
My noble friend makes a very good point. These training courses are very important. Following on from the noble Lord’s earlier question, we feel that it is very important that we build them up. We are still scoping these training courses. As I said, we have just completed several courses in the Erbil area in heavy machine-guns. We are currently doing combat infantry training and sharpshooter training with the Danes in the Sulaymaniyah area. Two more courses are being carried out.
Our soldiers have helped commercial contractors to train the Iraqis in counter-IED. As I said earlier, this is something in which we have a real niche speciality. I can assure my noble friend that the “advise and assist” recce team returned to this country on 7 December, and options are being considered to set up a logistics headquarters and a ninth armoured mechanical division. PJHQ is developing a business case for counter-IED training at two build-partner capacity sites.
Lord Palmer of Childs Hill (LD)
Will my noble friend tell the House whether, across government departments, there has been an assessment of any further terrorism risks in the UK because of our further forays into Iraq? Could my noble friend also say whether the perceptions of what the UK forces are doing in Iraq has been consulted on with our ambassadors in Egypt, Jordan and the Gulf states?
Lord Astor of Hever
I can assure my noble friend that we are in discussions with the Foreign and Commonwealth Office and DfID. As my noble friend knows, General Sir Simon Mayall has been out to the Gulf. He has just returned from Egypt and has been discussing with the Egyptian Government the very point that my noble friend raised.
Lord Stoddart of Swindon (Ind Lab)
What is the position of our troops if they come under attack or are put in danger as a result of being in Iraq and helping the Iraqi forces?
Lord Astor of Hever
The noble Lord raises an important point about rules of engagement. As we are still scoping the numbers to go out and they are very small numbers, it is too early to say anything about the rules of engagement. But we are confident that members of the Armed Forces who are being sent out will be there in a training role and they will be far from the combat zone. Once we have finished our scoping, this important issue will be looked at very carefully.
Lord Spicer (Con)
Given the increasing instability in central Europe, are the Government not absolutely right to avoid mission creep in the Middle East?
Lord Astor of Hever
I am sorry but I missed the last part of my noble friend’s question.
Lord Spicer
Are the Government not right to avoid mission creep in the Middle East because of the growing instability in central Europe?
Lord Astor of Hever
I agree with my noble friend. We have absolutely no plans for mission creep. We have previously announced our intention to support the Iraqis with training their forces and, as I said earlier, the Iraqi Prime Minister has been very clear that they do not want to see western ground combat forces.
The Marquess of Lothian (Con)
Can my noble friend tell the House whether the number of air strikes being carried out by Her Majesty’s forces in Iraq are at the moment increasing or decreasing?
Lord Astor of Hever
My Lords, I probably can tell my noble friend that, but I fear that I may get into trouble if I say too much. I do have some figures. They are official-sensitive and I am probably unable to tell my noble friend that.
Earl Attlee (Con)
My Lords, are we providing training on our own or are we co-operating with other states? Perhaps my noble friend could say which other states are providing training missions. Are we training Iraqi regular forces or irregular forces?
Lord Astor of Hever
My Lords, I pay tribute to my noble friend who of course knows Iraq very well, having himself served on Telic 1. As for help from other coalition members, there have been significant offers of support in principle from coalition partners. For example, I understand that the Australians have offered up to 400, New Zealand up to 100, the Danes 120, the Germans around 100 and Italy 280. The US has authorised up to 3,100 personnel to be in Iraq.
Baroness Hodgson of Abinger (Con)
Will my noble friend kindly tell us whether there will be a component of the preventing sexual violence initiative in the training in Iraq?
Lord Astor of Hever
My Lords, I cannot tell my noble friend that from the Dispatch Box. I have written to her on this issue and I will give her my assurance that I will follow it up and write to her as soon as I possibly can.
Northern Ireland: Talks Process
(10 years ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Parliamentary Under-Secretary of State, Wales Office (Baroness Randerson) (LD)
My Lords, with the leave of the House, I should like to repeat as a Statement the Answer given to an Urgent Question in the other place by my right honourable friend the Secretary of State for Northern Ireland. The Statement is as follows.
“I am grateful for the opportunity to update the House on the cross-party talks which have been taking place in Stormont over the past nine weeks. In September, the Government concluded that the time was right for a fresh round of political discussions to be convened with the parties in the Northern Ireland Executive. The Irish Government reached the same conclusion.
The aim was to address some key issues which are hindering the effectiveness and credibility of devolution and the Stormont Executive. These included: welfare reform and the Executive’s budget; the so-called legacy issues of flags, parading and the past; and reform of the political institutions. The talks began at Stormont House on 16 October.
As a signatory to the Belfast agreement, the Irish Government have been fully involved in all those matters where they too have responsibilities, consistent with the three-stranded approach, which means that the internal arrangements for Northern Ireland are a matter for the UK Government and the parties.
I would like to take this opportunity to put on record my thanks for the positive and constructive role played throughout by the Irish Minister for Foreign Affairs, Charlie Flanagan TD, and his team of officials. In addition, I am very grateful for the support and wise counsel of my honourable friend the Member for South West Wiltshire, the Parliamentary Under-Secretary of State at the Northern Ireland Office. The US Government have also been supportive and closely engaged with this process, in particular through Secretary of State Kerry’s representative, Senator Gary Hart. So far around 90 hours of formal talks have taken place.
My right honourable friend the Prime Minister and the Taoiseach, Enda Kenny TD, have been closely following the whole nine-week process, and on Thursday they joined the discussions directly. They conducted an intensive round of talks with the Executive parties and I would like to thank both of them for their support, perseverance and ongoing commitment to the process.
Despite their efforts, by early Friday they made a realistic assessment that there was still insufficient consensus across the parties for a broadly based agreement to be reached. Shortly afterwards, all five Executive parties declared their firm intention to continue to strive for a deal. They asked me and Minister Flanagan to take part in a resumption of discussions on Friday afternoon, which we duly did.
Let me briefly set out to the House the outline of a deal put on the table on Thursday. A draft heads of agreement was tabled including a fresh approach to the past which puts the needs of victims and survivors at its heart, devolved arrangements for adjudicating on parades that would see the Parades Commission replaced by a new authority and reforms to the institutions such as support for those parties that might want to form an opposition within the Assembly.
The draft also sought a commitment from the Executive to press ahead with welfare reform though with a number of flexibilities to reflect Northern Ireland’s circumstances and to implement a serious efficiency programme to make long-term savings in the costs of government. This draft was the result of the work of both the UK and Irish Governments respecting the three-stranded approach and we believe that it represents a balanced package and a sound basis for cross-party agreement.
During the evening, the Prime Minister also set out proposals to provide further financial assistance from the UK Government. This included flexibilities which would have given the Executive nearly £1 billion of extra spending power to help them through their current difficulties and support their most important priorities. It would also allow the devolution of corporation tax to go ahead—a change which just a few years ago seemed inconceivable and undeliverable is now within the grasp of Northern Ireland’s leaders, if they choose to take it.
The talks resume this week and the stakes are high. All parties agree that if there is no agreement before Christmas, we will not get this close again for months or even years. In particular, failure to agree a balanced final budget would leave the Executive increasingly unable to conduct even ordinary day-to-day business effectively, so this week is crucial.
All of us have a responsibility to do whatever we can in the few days left to us. The UK Government have shown that they can compromise, even over hugely sensitive and difficult issues regarding Northern Ireland’s past and even when resources are constrained by the need to deal with the deficit. We will continue to do all that we can to deliver agreement within the financial constraints in which we are operating.
However, the UK and Irish Governments can only do so much. Ultimately, whether an overall agreement is reached is down to Northern Ireland’s political leaders. They have a chance to show that, once again, they can move Northern Ireland forwards towards a better future, where politics works, the economy grows and society is stronger and more united. This is the prize on offer, and I know that all participants in the talks will have the support and good will of the House in our continuing efforts to seize it”.
Lord McAvoy (Lab)
My Lords, I am grateful—as I am sure the whole House is—to the noble Baroness for repeating this Statement made first in the House of Commons.
There has always been a broad consensus among the parties, although we have expressed in minor and quite mild terms our concerns about the lack of proper engagement by the Government since 2010. Does the Minister understand the disappointment and surprise of the five Executive parties at the swift exit of the Prime Minister from the talks? That compounds what is perceived by the people of Northern Ireland as a lack of total engagement by the current Government on the issue of Northern Ireland. Non-agreement on the difficult issues of flags, parades and the past means that many communities in Northern Ireland remain divided. What progress does the Minister think has been made in helping to build a shared future for Northern Ireland? As we all know, failure to agree on contentious issues such as flags and parading has in the past led to violent protest. Is the Minister, therefore, concerned by the chief constable’s warning that cuts to the service’s budget will mean that it will have fewer resources to allocate to policing public events?
Baroness Randerson
My Lords, I think it is absolutely unacceptable to suggest that the Secretary of State has been anything less than totally dedicated to these talks. The Secretary of State has personally worked on this very strongly every week since October and has made every effort to ensure that the talks are successful. The Prime Minister has remained very closely in touch.
I remind the House that there is a very strong imperative here to reach agreement. The prize, as was pointed out in the Statement, is the devolution of corporation tax. It is a fact of life that this Government are drawing to a close with the coming election. To get legislation through Parliament in time for the end of our business, with the election coming, it is essential that the agreement on corporation tax is made virtually immediately. Therefore, the Prime Minister’s efforts are concentrated in time to enable this agreement to take place in a way that enables devolution of corporation tax to be effective.
The noble Lord is very accurate in his comments on the impact on day-to-day services in Northern Ireland. He mentions the PSNI, but if there is no agreement on the budget it goes across the board. I urge the parties in Northern Ireland to redouble their efforts, because it is essential that they reach agreement so that day-to-day services can continue to be delivered.
Lord Alderdice (LD)
I thank my noble friend for repeating the Statement, to which I listened carefully. However, given that the Statement says that the Prime Minister and the Taoiseach judged that there was insufficient consensus for a broadly based agreement and that there is only one week in which to find any agreement, one is led to the conclusion that the best to be hoped for is for something to be cobbled together that could take us to the other side of the Westminster election, when the numbers of people elected, the balance of parties and coalitions and so on may be different.
However, I am struck by the fact that the Statement says:
“If there is no agreement before Christmas”—
a week away—
“we will not get this close”,
not for a few weeks but,
“for months or even years”.
One might take from that that there was an expectation on the part of the Government that we might be moving towards direct rule. Can the Minister confirm that before there could be any movement towards direct rule, there would have to be an election for a new Assembly in Northern Ireland, to give newly elected Members the opportunity to get into negotiations and to try to form a Government?
Secondly, can she confirm that if that were not achieved and there was direct rule, that there would be implementation—“press ahead” was the phrase used—of welfare reform, and, in the words of the Statement, the implementation of,
“a serious efficiency programme to make long-term savings”?
Can she confirm, too, that the Irish Government would have to be involved in all the cross-border bodies that are already in existence and—without doubt, given that the security situation would be likely to suffer—cross-border co-operation on security and justice issues as well?
It is important not just to pose these questions but to get an answer, because I have the sense that on both sides in Northern Ireland there is a failure to recognise the process that would ensue from lack of agreement, and the consequences for people from both sides in terms of welfare reform, efficiency savings and cross-border co-operation between the British and Irish Governments.
Baroness Randerson
My noble friend makes some important points about the process to be followed. I start by saying that the agreement needs to be genuine, and not something cobbled together, because that would fall apart. My noble friend is right to point out that the Statement clearly says that the window of opportunity will close in the new year. The realities of the time in the electoral cycle make it difficult. If the Executive were to collapse, the first and immediate result of that would be an election, and only if we were unable to re-establish an Executive would it be possible to think of direct rule. There is no legislation in place for the re-imposition of direct rule. If direct rule were, very regrettably, the eventual outcome, it would have to be in accordance with the terms of the Belfast agreement. My noble friend is right to point out that there is a role for the Irish Government in those terms.
Lord Maginnis of Drumglass (Ind UU)
My Lords, I thank the noble Baroness for bringing the Statement to the House. She hit the nail on the head when she talked about returning to the Belfast agreement. That was in 1998, and since then we have had little more than tokenism as far as Westminster is concerned. Let me reiterate what the noble Lord said earlier. We have no hands-on direct involvement between Northern Ireland and the Palace of Westminster despite the fact that we are part of the United Kingdom. The Prime Minister arriving without any consultation that I am aware of with anyone who went through the entire talks process from 1994 to 1998—in fact, it was even longer than that—and a Secretary of State who has been negligent in her liaison with those who have experience not only of the political problems but of the terrorist problems that we suffered in Northern Ireland for 28 years, is quite ridiculous. We cannot assume that a 24-hour or 48-hour visit will have the slightest impact on the problems we face or on building confidence between two sections of the community which are still sadly—
Baroness Jolly (LD)
My Lords, we have only 10 minutes. The Minister will not have time to respond.
Lord Maginnis of Drumglass
I thought that the noble Baroness might say that. Thank you.
Baroness Randerson
The noble Lord refers to a lack of hands-on involvement by the UK Government. I would point out to noble Lords that that is what happens when you abide by the terms of the devolution agreement. If Northern Ireland is to recover from its past, it is essential that the politicians and the structures of Northern Ireland be allowed to bed in, to develop and grow, and to work. It is important to bear in mind that we have now had the longest period of devolution in Northern Ireland since the 1960s, and the success of that period should be acknowledged.
National Parliaments (EUC Report)
(10 years ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Boswell of Aynho
That this House takes note of the Report of the European Union Committee on The Role of National Parliaments in the European Union (9th Report, Session 2013–14, HL Paper 151).
Lord Boswell of Aynho (Non-Afl)
My Lords, this is not just a debate about a Select Committee report, or about internal parliamentary processes. It is also by extension a debate about the future of the European Union and the United Kingdom’s relationship with it, so I am delighted that so many noble Lords are here to debate this vital issue.
Today, Europe faces huge, almost existential problems, and the economic crisis has thrown the deficiencies of the Treaty of Lisbon into stark relief. Growing disenchantment and disillusionment with the EU is evident in the continuing fall in participation in elections to the European Parliament, the rise in extremist parties across Europe, and the lack of trust between elected officials and their electorate. The question of democratic legitimacy now needs serious public debate so that the people of Europe can contribute to finding an answer. This is not just a crisis of public confidence in the Union, it is also a crisis of public confidence in politics more generally. Not every vote for UKIP is in my view necessarily a vote to leave the European Union—often it may simply be a protest vote, a vote for “none of the above”. However, we will never succeed in overcoming the Europe-wide democratic deficit unless we also look at and address our own shortcomings. It is not “their” problem over in Brussels, it is also our problem here in Westminster.
Giving national parliaments a more positive and active role in European affairs is not a panacea, but it is a key component in addressing the European democratic deficit. That view is widely shared across Europe, and I pay particular tribute here to the work of our colleagues in the Dutch Tweede Kamer and the Danish Folketinget, which is highly consonant with our report. The European Commission and the United Kingdom Government have also given their support. The Commission has expressed enthusiasm for better engagement with national parliaments as a natural extension of the existing political dialogue. The new Commission First Vice-President, Frans Timmermans, is particularly supportive, and his enhanced role within the new Commission overseeing relations with national parliaments and the issues of subsidiarity and proportionality, is very much to be welcomed.
The problem is in moving beyond easy generalities and warm words. Underlying the general agreement that national parliaments should have a greater role, there are many different political perspectives. Some in the European Commission may see strengthening national parliaments as a way to increase democratic control of the actions of national Governments in the Council of Ministers. In statements by Her Majesty’s Government, their emphasis on national parliaments sometimes acquires a tinge of slightly Eurosceptic flavour, while at the other end of the spectrum, some in the European Parliament fear that proposals to increase the role of national parliaments may simply undermine their own authority. There are also significant practical organisational problems in mobilising national parliaments to action. Against that backdrop, perhaps it is not surprising that whenever it comes to taking specific and concrete action, everything suddenly seems too difficult.
We on the European Union Committee of your Lordships’ House are acutely aware of these problems as we battle to make progress on several fronts at once. On the domestic front, we confront growing deficiencies in Her Majesty’s Government’s handling of parliamentary scrutiny. There is no point in the Government professing to support an enhanced role for national parliaments if they have neither the will nor the capacity to submit their own actions in Europe to proper parliamentary scrutiny.
Last week, the committee took evidence from the Minister for Europe, David Lidington, and I listed a series of failures by various departments over recent months. I will not repeat myself now, but instead and I hope for the last time, I will touch briefly on parliamentary scrutiny of the United Kingdom’s justice and home affairs opt-out. I described this sorry saga at length during our last debate on 17 November. All that I will add tonight is that the Home Office, having consistently failed to abide by its obligations under the scrutiny process, capped it off last week by refusing our request for an oral Statement explaining the scrutiny overrides that took place on 1 December, and then failing even to publish a proper Written Statement. Instead, the department tried to sneak its explanation in under the radar as an annexe to a Statement on the unrelated Justice and Home Affairs Council on 4 December.
I trust that the Minister, as a former chairman of our Home Affairs Sub-Committee, will understand my concern over those events. Will he confirm in his reply that the first essential step towards strengthening the United Kingdom Parliament’s role in the EU is for the Government to do everything in their power to support effective domestic parliamentary scrutiny of European Union matters? I hope also that he will set out for the House some practical steps that the Cabinet Office, which he represents in this House, is taking to address its own shortcomings, and which have been the subject of further correspondence. Put simply, the Government must get their own house in order first of all.
However, this is not just a government problem. The onus is also on us as a national legislature to make a more effective contribution to developments in Europe. We need to elevate the debate on the European Union, speaking with equal honesty about its benefits and its shortcomings. If we fail to do that, the risks are clear. I suspect that the leaders of the two main parties in this country may now be regretting their refusal to engage in a proper debate about United Kingdom membership of the European Union in the run-up to the European parliamentary elections earlier this year, as by so doing they effectively gifted control of the political agenda to UKIP. I might mention at this point that Her Majesty’s Government still refuse to acknowledge in print the democratic mandate of the European Parliament, even though meetings with individual Ministers suggest that the views of the Government are more nuanced than they are willing to admit publicly.
So much for the political background to tonight’s debate. For the remainder of my time, I shall touch on the efforts we are making in the European Union Committee to make progress in a few specific, targeted areas. The first of these is the reasoned opinion procedure. This is the only formal role in scrutinising European legislation given to national parliaments by the treaties, and as such it has an important symbolic value, but it can work only if there is good will on all sides, particularly within the European Commission. Hitherto, frankly, that good will has been lacking, and the Commission’s recent hasty, legalistic dismissal of the yellow card issued in respect of the proposed European Public Prosecutor’s Office was frankly and simply unacceptable.
We suggest in our report various ways in which the reasoned opinion procedure could be improved, without, we believe, the need for treaty change. These could include, for example, extending the deadline or reducing the threshold necessary for a yellow card to be issued. The essential point is that a yellow card should have a real impact, and be seen to have that impact. If a quarter of national parliaments feel strongly enough about a proposal to lodge reasoned opinions, then the Commission must sit up and take notice. It must undertake, if not formally to withdraw the proposal, then at least to amend it substantially. More generally, the Commission needs to be more open to dialogue with national parliaments. It must be prepared to argue its case and, on occasion, change its mind. The new Commission has publicly undertaken to be more receptive to reasoned opinions, which is good news, but the real test, in practice, has yet to come.
A bigger challenge for national parliaments is to engage upstream, in the early stages of policy development, when there is the greatest potential to exercise influence. That is especially difficult in our system of parliamentary scrutiny as it is predicated on reviewing legislative proposals only after they have been formally adopted by the Commission. In effect, we are stuck in reverse, when what we really want is a forward gear.
The so-called green card, described in paragraphs 55 to 59 of our report, could offer us that forward gear. The idea is straightforward: a group of national parliaments should be able to come together to propose legislation to the Commission, and the Commission should undertake to consider and respond to such proposals.
I emphasise that a green card procedure would not necessarily mean more legislation, or yet more Euro-initiatives. It could mean the amendment or repeal of existing legislation. Indeed, my sense is that the current Commission would be much more likely to respond positively to proposals from national parliaments which supported, for example, its own REFIT programme to simplify European law and reduce regulatory burdens. That is also very much our Committee’s approach. The response to the green card idea has so far been positive. At the COSAC conference—that is, the conference of chairs of committees such as the one I represent in your Lordships’ House—in Rome earlier this month, there was widespread support for the concept.
Lord Spicer (Con)
If there was repeal of legislation, could that include the repeal of something in the treaty?
Lord Boswell of Aynho
A treaty—I would be subject to advice—is, of course, concluded between member states and, although it is part of the constitution, it is not, by itself, part of the legislation. I think that if there were a widespread demand for a change in the treaty for good reason, that could certainly be taken forward as part of the political dialogue.
To return to COSAC, we met in Rome earlier this month and there was widespread support for a green card and a very positive attitude. More meetings are planned in the new year, at which we will explore in detail how a green card procedure might work in practice. We are also looking at other ways to encourage upstream dialogue between national parliaments and European policymakers. In particular, we need to focus more on scrutinising the Commission’s work programme. We know that President Juncker has promised a more politically responsive work programme, focusing on growth and jobs. We need to be engaged in developing and realising this. That means we need to be more agile, talking to the Commission, responding to consultations, building up alliances with colleagues in other national parliaments and the European Parliament, keeping in touch with our own Government, of course, and undertaking forward-looking inquiries.
Reconnecting the European Union with its citizens is not going to be easy. Nor is it going to be easy, over coming months, to defend the United Kingdom’s continuing role in the European Union. I believe passionately that finding practical ways to enhance the role of national parliaments—which are, by definition, close to their citizens—is an important component in our response to both these challenges. We need a new approach and a new way of working jointly with our partners. I and my colleagues on the European Union Committee will do our part, but I also look to Her Majesty’s Government to lead by example. They must show, by diligently respecting the scrutiny process as it affects the two Houses of this Parliament, that they genuinely embrace the involvement of Parliament in European Union law-making. This is now less a time for words and more a time for effective action. I beg to move.
Baroness Quin (Lab)
My Lords, I am very pleased to have the opportunity of speaking in this debate, both as a member of your Lordships’ Select Committee on the EU and as the chair of the EU sub-committee dealing with justice, institutions and consumer affairs. Having only recently become chair of the sub-committee, I begin by paying warm tribute to my predecessor, my noble friend Lady Corston. I know from my own experience and also from other members of the committee how much her wise, calm and friendly chairing of the committee was appreciated. Under her guidance the scrutiny work of the sub-committee was thorough and detailed. This was particularly true in the case of the role of the European Public Prosecutor’s Office, referred to a minute ago by the noble Lord, Lord Boswell, where the committee’s report leading to a reasoned opinion being approved by your Lordships’ House raised issues which are relevant to this report and to our debate this evening.
I very much welcome the report that we are discussing today and the way it has been presented to us by the noble Lord, Lord Boswell. The conclusions of the report contain many worthwhile recommendations which I hope will be acted upon. Indeed, noble Lords will know that our reasoned opinion on the European Public Prosecutor’s Office was one of a number approved in national parliaments across the EU, leading to the yellow card threshold being reached. Yet, as the noble Lord said, when a yellow card is issued, in theory the European Commission should engage seriously in a discussion with national parliaments about it, but in this case it failed to do so.
We very much hope that the new Commission, the words of which have so far been very encouraging in terms of relations with national parliaments, will take much more seriously any yellow cards issued in future. Certainly, the appointment of Frans Timmermans as a senior vice-president with specific responsibility for relations with national parliaments is something we should build on in order to try to get a much more effective system than we have had up to now. I also endorse what the noble Lord, Lord Boswell, said about the desirability of national parliaments being able to influence the process around a green card at a much earlier stage than is normally the case at present.
Some of our recommendations are, of course, directed to the Government. I hope that the Minister will be able to assure us that they will deal with the European Union Select Committee and the sub-committees in a timely and responsible way. On the whole, the Government engage with the work of the committees, but none the less, as the noble Lord, Lord Boswell, said, there have been a number of examples of where the Government have not replied to committees in good time. There certainly needs to be consistency across government and government departments. It would be good to hear in which ways the necessary co-ordination is going to be achieved in future.
In considering these issues, on a personal note, I am influenced not only by being a Member of your Lordships’ House but by having been a member of the scrutiny committee in the House of Commons in the early days of that committee, by having been Europe Minister and by the fact that I began my elected political life as a Member of the European Parliament in the first directly elected Parliament way back in 1979. Perhaps because of that, I am particularly keen to endorse the words of the noble Lord, Lord Boswell, who is on the record as saying that the relationship between national parliaments and the European Parliament should not be a zero-sum game.
Indeed, I somewhat bridled at part of the Government’s response to our report. While it said, quite rightly, that national parliaments seek to be, and in many cases are, close to their citizens, the subtext seemed to denigrate the European Parliament and its representative role, which would be unfortunate. While I yield to no one in my admiration for the thorough work this House does in scrutinising European legislation, it has to be said that we are not elected and we do not have constituencies or geographical areas to relate to or to represent in that formal way. Furthermore, given that Members of the European Parliament represent political parties, they do not campaign just in European elections but take part in general and local elections and presumably have plenty of contact with voters in doing so. I was an MEP in the days of Euro constituencies, which I have to say I rather approve of in comparison with the large regions that are represented today. In that role, I had regular contact with people affected by European rules, whether in the fishing industry, which was a very controversial issue at the time in terms of European legislation, or in the shipbuilding industry, which was big in my European constituency at the time, or in companies, local authorities, charities and others seeking to access European funds or simply requesting information about European single market rules which might affect them.
I am concerned not to promote competition between national parliaments and the European Parliament but to look at ways in which the joint working of the two can be improved. It seems to me sad and somewhat ironic that in these days when the European Parliament has much more power than it had when I was an MEP, contact in many ways seems less frequent and less productive than it was then. I therefore think it is an urgent matter for us and others to consider.
There are practical problems in that the timetables of MEPs, MPs and Members of your Lordships’ House mean that physical contact and joint meetings are challenging, at the very least. None the less, with modern technology that could be overcome, and at least some of the recommendations in the report in front of us today about how committees in both Houses of Parliament could link with rapporteurs and spokespeople in the European Parliament committees need to be acted on and would be a practical way forward to encourage the kind of joint working we would like.
I believe that a more effective role for national parliaments, as well as better co-operation between national parliaments and the European Parliament, can mean better scrutiny and much more accountability and transparency in the European decision-making process. This must improve democracy and help address the democratic deficit. That has to be in the interests of all the citizens whom we seek to serve.
Lord Teverson (LD)
My Lords, as the noble Lord, Lord Boswell, said in his introduction, this report and debate are particularly important because they are about democratic accountability within the European Union—something that all of us, whether we are anti-Europe, pro-Europe or trying to reform Europe, are aware of, and something that needs to change.
The noble Baroness, Lady Quin, mentioned the 1979 election. I, too, was an MEP, but I did not enter the European Parliament until 1994. Before 1979, we had a European Assembly made up of national parliaments—and, basically, it did not work. That is why it needed to change at that time. I am glad to see that the report does not look back to that sort of model. It is good news that we are not trying to work back in that way.
It is useful to say how the system is supposed to work. National parliaments have a very specific role within the European architecture. They always have done. It is clearly to call national Governments to account. That is the fundamental element of European liberal democracies. Parliaments are there to control their Executives and their Ministers. It is Ministers who go to the Council of Ministers and make decisions. Whether before or after those decisions, national parliaments have a fundamental role in the way that Europe works through the Council of Ministers.
The European Parliament has its direct democratic role in terms of representing citizens, however well that does or does not work, and what you have, although few people outside this architecture understand it, is effectively a bicameral European Parliament. You have a house that represents citizens, which is the European Parliament at the moment, and you have a house that represents nation states and Governments, which is the Council of Ministers. Between them, they make decisions.
They do not initiate legislation under normal circumstances, but of course in the UK the Houses of Parliament do not on the whole initiate legislation, either; it is done by the Executive. Successful Private Members’ Bills are few and far between. That is how the system should work: national parliaments tie down their Ministers and their Governments in terms of accountability, and you have a European Parliament that should be fully respected by its citizens and represents direct democratic accountability.
Of course, that does not work perfectly. In fact, it does not necessarily work very well at all, because for that system to work there needs to be full confidence in the European Parliament and parliaments have to call Ministers to account effectively. It needs national Members of Parliament to understand how European institutions actually work, and that is a huge challenge. Certainly, when I was an MEP, I was quite astounded by how national parliamentarians had no clue about how the European Union worked. That is key, and I find it quite strange.
It also needs subsidiarity to work. Subsidiarity means that the European Parliament and the Council of Ministers do only things that are appropriate to the legislation they are undertaking, but that requires a common understanding of what levels of subsidiarity might be, and there is quite a north/south divide on that.
The first route in terms of getting institutions to work to more democratically is to get that system to work. Certainly, in terms of European Union reform and the European Parliament, that requires getting rid of the double seat of Strasbourg and Brussels, the European Parliament stopping its penchant for turf wars with the other institutions, and better representation. I entirely agree that regional representation is much better because of proportional representation, but it is more difficult in terms of single-Member accountability. Ironically, I was the Liberal Democrat who suffered from proportional representation in 1999. In certain nations, such as France, there is the national responsibility of deputies. I do not think that is a very good system, but clearly national Governments should be able to decide. The size of the European Parliament should perhaps be controlled, but who are we, as the House of Lords, to preach on that matter?
When it comes to national Parliaments, I think that the most important thing, in terms of national architecture, is that we do not start setting up further institutions that do not have the power to do anything. The Economic and Social Committee—and I would even say the Committee of Regions—are bodies that were set up at particular times. They are there for consultation, they can give their opinion, but, other than that, they have no ability to influence what goes on. I think that that is a major lesson. In my view, they should be abolished because of that.
I think the yellow card system is a good one, but we have seen, perhaps because it is in its infancy, the difficulty of getting it to work. The green card system that the committee has described is very positive and could be set up, I am sure, without a treaty change in terms of having an institutional agreement, which happens a lot within European institutions. Certainly my experience when I had the honour to chair the EU External Affairs Sub-Committee, when I went to one of the newly established Defence and Security Conferences that happen every six months in the capital of the presidency at that time, was very mixed. It was to a degree a talking shop. Some of the nations felt that it should be able to give recommendations and vote, which it could do on certain issues. Others felt that we should keep well away from that area. It was very limited in what it was able to do.
As far as the commission is concerned—we have, of course, 28 commissioners from 28 member states—I wonder whether each commissioner should be allocated not their own nationality but a country, an EU member state with which they particularly liaise. That may be a way in which accountability to national Parliaments could work. It is particularly important in the second-pillar areas, justice and home affairs and foreign affairs, where there is not exclusive European Union competency.
For instance, the High Representative issued an annual report on the External Affairs Committee’s success or otherwise during the year. That would have been something that we wanted to talk to the external affairs service about, and I am sure that other national Parliaments would have wanted to as well. Clearly the external affairs High Representative is not someone who can go around to 28 member states, but there are other ways of doing that. I think also—and I do not think the report gets fully into this—that with regard to the President of the Council, Donald Tusk, there is a need for direct parliamentary accountability to a degree.
Here in Westminster I agree entirely that there should be pre-Council scrutiny. I think our own sub-committees should scrutinise legislation openly. We have closed sessions at the moment; I do not understand that. They should be open. We should show the transparency in this House that we are asking for elsewhere. There should be greater liaison between House of Commons committees and the House of Lords. The EU Committee has tried to bring together MEPs, MPs and Members of this House in a triumvirate of discussions. That has been of limited success, but I think it should work hard on that.
I think that the biggest gap, though—and the report emphasises this—is in the area of economic and monetary affairs. That does not affect the United Kingdom quite as much as others, but there is definitely a deficit there. In other reports that I have read, there has been almost an opt-out by national parliamentarians to get involved with those issues at a European level—except for the Republic of Ireland. That is quite strange, because it is an area that clearly needs to be filled in terms of democratic accountability. I was interested in Graham Bishop’s evidence in the report that it was only the ECON committee that had any chance of calling the ECB to account. I think that that is absolutely correct.
I very much welcome this report. I am very pleased that the Minister replying, my noble friend Lord Wallace of Saltaire, has a long history in European issues. I look forward to his reply to the many questions that there will be. Certainly, democratic accountability is wanting. The European Parliament is an excellent institution that needs to improve itself. This is an area that we need to make work as it is supposed to by making the improvements suggested by this report.
Lord Wilson of Tillyorn (CB)
My Lords, I count myself very much a new boy on the European Union Committee of your Lordships’ House, although I have served on sub-committees, which do such valuable work in monitoring what goes on. It was particularly instructive for me to serve under the chairmanship of the noble Lord, Lord Boswell, on this particular report on the relationship with the European Parliament.
We are all very familiar—much too familiar, as the noble Lord, Lord Boswell, said—with the general disenchantment in this country with political institutions. It is true that the disenchantment with European Union institutions goes even deeper than that. It is striking to compare that with the atmosphere in Scotland during the referendum earlier this year. There was enormous enthusiasm, voter turnout of 85% and deep, long discussions for weeks before the referendum took place. This was completely different from the attitude towards the overall national institutions and, indeed, towards Europe.
It may be that absence makes the heart grows fonder, but in political terms we see no evidence that political distance from the institution to which you belong makes the heart grow any fonder at all—rather, the contrary. That is why, surely, the role of national parliaments in the European Union is so important and why the recommendations of this report can be so useful in dealing with the problem.
National parliaments, after all, if seen to be taking an active role in European Union affairs and not just holding our own Ministers to account—which I think we do very well—can make people feel that their own views and their own interests are being properly brought to bear on European institutions. It does not solve the whole problem of mistrust of European institutions, but it can and it should help. I am sure that other noble Lords are much more capable and experienced than I am to deal with the detailed recommendations of the report. I should like to touch in general terms on two aspects. One of them is the relationship with the Commission; the other is the relationship with the European Parliament.
When the committee visited Brussels to hold talks, I was struck by how responsive and how willing to discuss matters some commissioners and some of the very well informed officials there were. That was not true of all commissioners, or of all officials, but it was quite marked how much it helped to go and talk to the people there. The use of the reasoned opinion—the so-called yellow card procedure—has already been dealt with in detail by the noble Baroness, Lady Quin, but one cannot help but be struck by this institution’s being a very good way of involving national parliaments. Very seldom is it possible for the national parliaments to get together and produce enough votes to convince the Commission that it needs to think again. On that one recent occasion to which the noble Baroness, Lady Quin, referred, what did that particular bit of the Commission do but simply, brusquely brush it aside and pay no attention whatever to what was said? That cannot be right and one hopes that it will never be repeated.
Fortunately, it seems that the new Commission is more conscious of the need to be responsive to the views of national parliaments. Let us hope that the new Commission will also be more flexible in the ways that could broaden the grounds for objection by national parliaments; for instance, the idea of a test of proportionality—the sledgehammer-to-nut type problem. Although that is not covered by the treaties, it should surely be possible, with the right will, to find informal ways in which that, too, could be taken into account by the Commission. Of course, attempting reforms on small matters such as this would not possibly justify treaty change, but if there is the will, then on a number of these things one gets the impression that it should be possible to find informal ways in which they could be carried forward.
It is right that we should press for a greater role for national parliaments, but it is right, too, that we should not just talk about the greater legitimacy that it would give to European institutions if our national Parliaments were involved, but also recognise the legitimacy of the European Parliament and take account of that, particularly since the Lisbon treaty.
I shall just make one point on the question of having greater contact with our own MEPs. This falls by the wayside all too often, as the noble Baroness, Lady Quin, said, often because of timetabling issues, with MEPs rushing back to their enormous constituencies when there is no time for them to stop here in Westminster. It would be helpful if we could have greater contact with our own MEPs, here in Westminster if possible, but otherwise with us going to Brussels, or to Strasbourg if the Strasbourg institution is still operating. That would be a great advantage.
In all these things, we need to somehow get through the problem that the European institutions look like some huge and impenetrable bureaucratic machine, and the further away we are from it the more impenetrable it seems. If we can enhance the amount of personal contact that we have with our MEPs, commissioners and people who work in the Commission, I am sure that this would help. In many ways, it could be much more effective than reams of official papers.
It is encouraging that the Government took a generally positive attitude towards the recommendations of the committee, and encouraging that the new Commission seems responsive to the idea of greater involvement by national parliaments. However, much needs to be done to increase the role played by national parliaments, and we will need all these favourable winds to see the necessary and practical recommendations in the committee’s report put into practice.
Lord Tugendhat (Con)
My Lords, I am delighted to have been a member of the committee that produced this report. I join others in congratulating the noble Lord, Lord Boswell, on the way in which he chaired the committee and brought it to a successful conclusion. The report deals with two subjects crucial to the future of the European Union. One is its insufficient democratic roots and the other is the lack of an EU-wide demos. Just as we on our committee have drawn from ideas and practices of other parliaments—the noble Lord, Lord Boswell, rightly paid tribute to the Dutch and the Danes—so I hope that other parliaments will look at the ideas that we have put forward and draw on them.
My reference to insufficient democratic roots and the lack of an EU-wide demos does not mean that I fail to recognise the enormous progress made by the European Parliament in recent years. I will not pretend that I am happy with all that it does or has done, but that its power and influence in European Union affairs and over both the Council and the Commission has increased very considerably cannot be denied. The recent initiative of Spitzenkandidaten is an example of that. None the less, the European Parliament’s debates, decisions and personalities still fail to resonate within the member states. We see that in terms of electoral turnout and media coverage. For the vast majority of people throughout the European Union, the fulcrum of political debate and decision remains their national parliaments. Therefore, if we are to strengthen the European Union’s democratic accountability and framework and create an EU-wide demos, national parliaments must be more closely involved in European Union affairs.
The European Parliament and national parliaments must not be seen as opposing or even as rival forces; rather, they should be seen as complementary forms of democratic legitimacy, each with its own role in the European Union framework. In large, decentralised and democratic countries such as the United States and Germany, one of the two Houses in their bicameral legislatures represents the component states. This is the principle, suitably adapted for a vast Union of 28 sovereign states, with more than 500 million inhabitants, that I wish to see carried forward in the European Union. The specific proposals in this report go some way towards doing that and I fully support them. However, in addition, I should like to make three additional points of my own.
My first point is directed to the Commission. I recognise the practical problems of responding to the demands of 28 parliaments, many of which have two Chambers. I welcome the responsibility for inter-institutional relations accorded to Mr Frans Timmermans in his role as first vice-president, but he is a very busy man and he has a great many responsibilities. This particular responsibility does not feature very high on the list. I noticed that when I looked at the website. Therefore, more is needed.
Many years ago, in the late 1970s, when I was a member of the Jenkins Commission, Mr Jenkins signalled a change in the relationship between the Commission and the European Parliament and the enhanced role of the latter by appointing a commissioner for European affairs, the senior commissioner at that time, Lorenzo Natali, an Italian vice-president. These days, there are not enough proper jobs to go around for 28 commissioners. In those days, some of us had three or four directorates-general, while some people now have less than one directorate-general. So I do not hesitate to suggest setting up a new body in the Commission to provide work for a commissioner. I think that the Commission should consider setting up a department for parliamentary affairs with a commissioner responsible for dealing with both national parliaments and the European Parliament as his main responsibility. By dealing with both the national parliaments and the European Parliament, it would emphasise the fact that these are two complementary forms of democratic legitimacy and not rival forms. Were there to be such a body within the European Commission, it would facilitate the Commission’s dealings with the national parliaments and make it less difficult for national parliaments to make their voice and opinion heard in Brussels. That is my first suggestion.
My second suggestion is to Her Majesty's Government, or at least to the Conservative element in it—the element that I support. I am delighted that the Government have explicitly welcomed the committee’s suggestion for greater co-operation between national parliaments and the European Union Parliament and also welcomed a greater engagement between the national parliaments. However, I wonder whether the Government—or the Conservative element in it—have fully thought through the likely consequences of such a development. As we all know, parliaments work through political parties, so this closer co-operation and engagement will be conducted by and through political parties, which in turn is likely to enhance the existing links between parties in the European Parliament and parties in the national parliaments and to foster new combinations of parties. That in turn will strengthen the influence of the big political families, left, right and centre. This will, I am afraid, leave those parties, such as the Conservative Party, which are not part of a big political family, at a very considerable disadvantage. I strongly recommend to the Conservative element in the Government that it should seek to end this self-imposed isolation. In doing so, it would be able significantly to increase its influence and, perhaps, avoid débâcles of the sort that occurred not so long ago over the appointment of the Commission President.
In this respect, I would draw a parallel with what happened over enlargement. As noble Lords will recall, the United Kingdom, under Conservative as well as Labour Governments, was one of the strongest advocates of bringing into the European Union the countries of central and eastern Europe. Somehow, it did not seem to foresee what this would mean in terms of free movement of labour, and it is now faced with the consequences. I would not like a similar lack of foresight to lead to a disadvantage for my party in terms of the European Parliament and the greater engagement of national parliaments.
My third point is addressed to the House of Commons. At present, EU matters are largely seen as the preserve of the admirable European Scrutiny Committee, under its very energetic chairman. However, just as national parliaments can reinforce the European Parliament in promoting democratic accountability and strengthening the democratic framework of the European Union, so other Commons committees could reinforce the role of the European Scrutiny Committee. I should like to see the subject-specific committees in the House of Commons become more engaged in considering the impact of existing EU legislation, and possible changes to it, whether by addition, amendment, or the return of powers to the member states. I should also like to see the subject-specific committees in the House of Commons do much more to hold British Ministers to account for what they do and say and advocate in the various Councils of Ministers. I should like to see this done both before Ministers go to Brussels and when they return. In that way, a very considerable strengthening in democratic accountability would occur.
I strongly support the proposals in the report, but I should also like consideration to be given to the three that I have added.
Lord Davies of Stamford (Lab)
My Lords, the noble Lord, Lord Teverson, has already made the important point that bringing national parliaments closer to the institutions of the EU, and particularly to the Commission, so as to improve familiarity of national parliaments with the issues and to enhance the influence of national parliaments on decisions being taken in Brussels is a cause that unites all three major parties in our democracy. It unites Eurosceptics and Europhiles. All those categories are well represented here this evening. Not surprisingly, UKIP is not represented here. Their representatives do not turn up much when they get elected to the European Parliament: they have the worst record for attendance there, a quite disgraceful one. They have not turned up tonight and they have demonstrated once again that they belong to a party that is very interested in demagogy, but not in doing an honest day’s work or even an honest evening’s work on European policy.
I congratulate the noble Lord, Lord Boswell, on this report, which he has produced with his colleagues. I also commend him on the great energy and engagement that he has brought to his considerable responsibilities and the robustness with which he is prepared to talk—we had an example of that earlier this evening—both to our own Government here and to the European Commission, or to anybody else who might be relevant when that is required, in order to make clear the strong, serious position of this House and its committees on European-related subjects.
I agree with an enormous amount of what has been said this evening. I agree very much with the noble Lord, Lord Tugendhat, on the latter part of his remarks, about the desirability of involving the departmental Select Committees in the scrutiny work much more systematically than happens now. I take this opportunity to add to the proposals made in this very interesting document with tuppenny-ha’penny-worth of my own suggestions, and I will make three proposals.
We are really confronting three broad issues this evening. One is how to bring national parliaments closer to the Commission and to have more influence with the Commission. There I disagree with the noble Lord, Lord Tugendhat, to whom I always listen not just with great respect but with great interest. He suggested that it would be a good idea to appoint a Commissioner responsible for relations with national parliaments and with the European Parliament. That would have unfortunate and counterproductive consequences: such a Commissioner would act as an insulating barrier between the two. It would be rather like dealing with the director of public affairs of a company instead of the chief executive. If you want to influence anything that a company does, that is not a sensible way forward. It is important to have much greater direct contact. I also disagree with the committee’s report in one respect—desirable as it would be—which is the proposal in paragraph 54:
“The Commission which will be appointed in 2014 should make a commitment that its Commissioners and senior officials will be willing to meet committees of national parliaments as a core part of their duties”.
That is very desirable, but idealistic and unrealistic as well. If a Commissioner spent half a day of his time with each of 28 different national parliaments or their representatives or their scrutiny committees, then he would be spending 14 working days—something like two and half weeks of his time—on that subject. That is not likely to happen. We have situations when we are able, in Select Committees of the House of Commons and in European sub-committees here, to meet Commissioners or senior officials of the Commission; I have been a beneficiary of that myself in various roles over time. However, sadly, I do not think it is realistic to expect that there should be some kind of statutory—or if not statutory, at least formal—commitment of the kind suggested in this document.
A much more promising proposal is that it should be a general rule that—and this can be agreed with the courts without any kind of constitutional change; it could be a rule decided by the Commission itself—once or possibly twice a year, every Commissioner would invite to a seminar in Brussels the departmental or specialised committees covering his particular responsibilities. They are called Select Committees in the House of Commons, but a lot of continental parliaments call them commissions. That would be an opportunity for the Commissioner to make a direct presentation to them of his agenda, and have perhaps some working groups getting into the detail of these proposals or other proposals that the national parliaments might want to advance, and to have some serious discussions from both sides, bringing the two bodies directly together without any kind of intermediary organisation or individual. I would be grateful if that proposal could be considered by our own committee. I myself sit on the Economic and Financial Affairs Sub-Committee of the European Union Committee.
The second thing that needs to be done is to bring national parliaments more closely together in the context of European scrutiny. Quite clearly, no national parliament is going to have much effect if it is isolated. If we want a yellow card—or not necessarily a yellow card, but some influence—it is necessary to combine with others, as is a normal rule in any sensible and functioning democracy. There is not much opportunity for that. The COSAC works well, but it brings together just the chairmen of scrutiny committees: that is a very narrow group of people. There should be an occasion once a year for, let us say, a two-day conference, bringing together those responsible for scrutiny in the national parliaments from all 28 member states. At the conference, it should be possible to have some detailed working sessions on particularly important or controversial issues, or on matters where there is a question of a yellow-card procedure being initiated—or having been initiated—by one or more parliaments. That would be an opportunity for anybody wanting a yellow card to make a case for that, and attempt to get other national parliaments to second that initiative. Human contact is absolutely indispensible; I have never believed in any context—in ordinary commercial marketing, advocacy or anything else—that electronics or digital communications can replace human contact. It is very important to be able to look at people in the face, hear the emphasis they put in their communications with you and make an assessment as to how reliable or serious they are and how much they have gone into the question that they are talking about. It is therefore central that there should be more human contact between the parliamentarians involved. That is the spirit in which I make these two proposals.
My third proposal relates to an area that has already been mentioned several times in this debate, and we are very conscious of it. We are not very good at scrutiny. As the noble Lord, Lord Teverson, said, the fundamental role of national parliaments as far as the EU is concerned is to make sure that we properly control our Ministers when they go to the Council of Ministers, because they go there as our delegates. In actual fact, with the exception of Denmark, no member state has really succeeded in making a reality of this theory, that democratic legitimacy stems directly from the national parliaments, because the Council of Ministers—one of the two legislative bodies in the European Union—is directly responsible to national parliaments. If we are going to make a reality of that, we need to change immediately the way we do business here. In my view, we need to make sure that we talk to Ministers before they go to the Council of Ministers. We should not take a decision to lift the scrutiny reserve merely on the basis of an Explanatory Memorandum and then, perhaps a month or two later, have an opportunity to talk to the Minister in retrospect about why he or she did or did not do whatever it was that is of concern to us. It is essential that Ministers appear before the relevant scrutiny committee or better still—here I agree totally with the noble Lord, Lord Tugendhat—the relevant departmental Select Committee before they go to the Council of Ministers meeting, so that they are forced to disclose their brief and agenda, hear the comments of parliamentarians, take them into account, and, if they wish to disagree with them, to do so openly and to try to persuade them or not, as the case may be. It is up to Parliament to decide whether or not to lift the scrutiny reserve when it has heard what the Minister has to say.
Those are three suggestions. They are not modest suggestions because they are quite far reaching, but I hope that they will make a modest contribution to the debate.
Baroness Smith of Newnham (LD)
My Lords, I welcome this very constructive and instructive report from your Lordships’ EU Select Committee, and particularly the comments of my noble friend Lord Tugendhat and of the noble Lord, Lord Davies, opposite. We will probably have cross-party agreement on many of the recommendations and the additional comments that have been made.
I do not propose to make any additional recommendations but have one or two interests to declare: a formal one that ought to be noted and a slightly less formal one. My formal interest is that for three years I was the principal investigator for an ESRC-funded project on national parliaments and the European Union. My department in Cambridge received money to study very similar topics to those that your Lordships’ Select Committee looked at. The slightly more trivial interest is that, on the basis of that, I was asked to give oral evidence to the Select Committee and sent in written evidence, so I appear as a small footnote in the report. However, I am one of the very few people speaking this evening who is not a member of the Select Committee or one of its sub-committees. Not being part of the committee process here in many ways puts me very much on the back foot but also raises the issue of who becomes involved in decision-making and scrutiny. One of the recommendations is very much about mainstreaming European policy. I and my colleagues from the OPAL project told the Select Committee and the scrutiny committee in the other place that mainstreaming is important. The Dutch Parliament has done it and it has worked very effectively. The report suggests that that is important here—to get more people involved.
We see that the usual suspects are here to talk about Europe, but it is worse in the other place. The Members who are willing to talk about, or engage with, Europe are usually sceptic. They have a particular interest in Europe, but not one that is necessarily informed or engaged. They think that if they stand up and opine about Europe in a way that grabs the headlines, that will be effective with my electorate. That rather misses the point. If you simply make grandiose statements which do not relate to the detail of Europe, you do your constituents a disservice. There is a real problem with the way that some chambers of national parliaments engage with the European Union. It is a particular problem in the other place in the United Kingdom, but it reflects a wider problem among national parliamentarians.
Noble Lords have the luxury of being very unusual. By dint of not having constituents and not having to go home every weekend to talk to constituents and focus on detailed constituency casework, there is the opportunity to take more time to scrutinise legislation. There is also the opportunity to do many of the things that have been mentioned this evening and which were recommended in the Select Committee report—to engage with colleagues in other parliaments. If you are expected to be here during the week and back in your constituency at the weekend, when do you go to Brussels, Berlin or Paris to talk to your opposite numbers? That is extremely difficult. We at this end of the building have the opportunity to talk to our colleagues, but we definitely need to find ways to engage more with other parliaments. Interparliamentary co-operation is vital.
One thing that is worth bearing in mind, but which very few national parliamentarians have been willing to bear in mind, is that for decades national parliaments have lost power under the European integration process. There has been a degree of deparliamentarisation. In most elected chambers, nobody wanted to talk about it. Who is willing to say, “Actually, we are less important than we used to be. The European Parliament has gained powers and has oversight but is also a democratic body representing the citizens of Europe”? That is not a terribly popular thing to say. If you are out trying to get votes in a domestic election, reminding people of the role of the European Parliament and of your own denuded role might not be the best way. Therefore, for many reasons, national parliaments have not been willing to talk about shifts in powers or the increased role of the European Parliament. In any case, the role of the European Parliament and giving it more powers does not in itself deal with some of the questions of deparliamentarisation. It does not bring Europe closer to citizens. The Lisbon treaty was supposed to do that by re-empowering national parliaments.
Here again, we have a slight difficulty of language. Many members of national parliaments would ask, “What do you mean by saying that the Lisbon treaty has given us new powers or given us powers back”? They are very reluctant to accept that powers have shifted and, in some cases, suggest that the Lisbon treaty and the yellow card was little more than a sop. There are questions about whether national parliaments feel that they have powers and are willing and able to use them. That issue is hugely important. We do not necessarily need treaty change; we need national parliaments to use the powers that they have. That was made very clear in the appendix to the report, where other members of COSAC said that they needed not more powers but for national parliaments to step up to the plate and say, “There are things we can do. We can, and should, hold Ministers to account, but we are not very good at doing it”.
It is not just about Westminster. Indeed, your Lordships’ House is one of the Chambers that is deemed to be a paragon in many ways and which scrutinises European legislation very well, but holding Ministers to account is something which nobody but the Danish Folketing does particularly well. However, this is not about giving more powers but using the powers that we have in more imaginative ways and using them collaboratively and collectively.
As the noble Baroness, Lady Quin, suggested, the roles of the European Parliament and of national parliaments are not part of a zero-sum game, they are about working together and ensuring that legislation at the European level is dealt with effectively. Each has different roles but we work through those roles most effectively if we co-operate, co-ordinate, exchange information, share ideas and stop the sort of turf wars that we saw at the start of the interparliamentary co-operation on common, foreign and security policy and prior to the deliberations of the Article 13 committee. It is important that parliaments co-operate vertically—national parliaments with the European Parliament—and horizontally with other national parliaments. As noble Lords have suggested, we need to do that on the basis of personal co-operation, interparty co-operation and within our parties in the other place and your Lordships’ House and our party families in the European Parliament, but also through working across parties at transnational level.
I can only say that I warmly endorse the recommendation of my noble friend Lord Tugendhat. I am not sure it is appropriate that I do so, but if the Conservative Party was part of the European People’s Party it would be able to engage more effectively in the work of the European Parliament and that would only be of benefit to the United Kingdom. Co-operation, co-ordination and exchange of information among personnel, parties and parliaments is one way in which national parliaments can become much more effective. Many of the recommendations in the Select Committee’s report would ensure that those things come about.
Lord Hannay of Chiswick (CB)
My Lords, it is customary in these debates to applaud their timeliness. I am afraid, unfortunately, that this debate is not timely. It is behind time by quite a long way. It should not have taken the Government three months, as opposed to the regulation two months, to reply to the report, although clearly the imminence of a parliamentary recess has acted as a magnetic pull. It should not have taken this House nine months to organise a debate on a report that can legitimately be described as one of the most significant and potentially consequential to be issued in recent years. It owed much to the skill and persuasiveness of the noble Lord, Lord Boswell, whose admirable introduction to the debate we have just heard and whose leadership I particularly appreciated when I served on the committee as this report was being prepared.
The noble Lord, Lord Boswell, set out some of the main recommendations of our report, which represent a wide-ranging menu of reforms to the role of national parliaments in holding their Governments to account and in shaping EU legislation. Those are the two broad thrusts of the role of national parliaments and there is no need to repeat what he said. The noble Lord, Lord Davies, suggested that asking the new Commission to take it as part of its duty to deal with national parliaments was nugatory and impossible to fulfil. In fact, with video conferencing and other such techniques, it is possible to do that with reasonable economy of time.
In the previous Commission, there were still commissioners who would openly say, in a quite aggressive way, that they had no responsibility at all to national parliaments: their sole responsibility was towards the European Parliament. That is not a correct interpretation of the Lisbon treaty, which gives them a distinct role. People who held those views would say: “National parliaments, you look after your own Governments; you do not have any control or influence over the Commission”. We have to break down those barriers. The recommendation, which was contained in the report and which I suspect the new Commission, with Vice-President Timmermans, is going to honour very considerably, was worth making.
Lord Davies of Stamford
I am grateful to the noble Lord for giving way. I am sure that he will recall that I said that if you can get this particular proposal, which was made in the report, so much the better. I personally thought that it was slightly unrealistic. However, my proposal of a rule that each commissioner should meet on a regular basis, at least once a year, with the members of the departmental select committees or commissions in the national parliaments on his subject of responsibility, would directly address the point just made by the noble Lord. It is important that commissioners should formally recognise a role for national parliaments and make sure that they take them seriously.
Lord Hannay of Chiswick
If I may say so, that is an addition to but not a substitute for the recommendation we made. It is important, when one of the sub-committees of your Lordships’ House is preparing a report on a particular issue, that it takes evidence from the commissioner responsible at that time, not just once a year. It is normally possible to do this and co-operation is pretty good, on the whole. However, there have been occasions when it has not been and we suggested that it should never be that way again.
Suffice it to say that we did not need to go back to first principles when we started to write this report, because the Lisbon treaty settled once and for all that national parliaments have a role to play in shaping European legislation. They have a collective role to play through such procedures as the yellow card. We did not really have to argue that case: we just took it from there.
However, the evidence we took established that that role—which has existed since the Lisbon treaty came into force in 2009—was not being exercised very effectively, so far, and that reforms were needed if it was to be so exercised. That is not some British Eurosceptic fad; it is the view of many other national parliaments which we consulted when we were compiling our report. In the years to come, strengthening the role of national Parliaments needs to be one part of any positive reform agenda worthy of the name. I notice that both the Government, in their response to our report, and the European Council itself, in the strategic agenda for the next five years, refer to the need for that role to be developed.
I do not intend to dwell long on the Government's response to our report, which was broadly very satisfactory and supportive. However, one point requires comment. The noble Baroness, Lady Quin, referred to it and I shall do likewise, but in slightly less polite terms. In their response to paragraph 15 of our report, the Government stated flatly that national parliaments were,
“the main source of democratic legitimacy and accountability in the EU”.
That is a pretty odd remark to make, 35 years after the European Parliament became directly elected and when it has wide-ranging powers of co-decision with the Council on EU legislation. Tactically, it was aberrant to say this, since nothing is more likely to frustrate any effort to reform the role of national parliaments than it becoming a food fight between them and the European Parliament. Yes, “a main source”—national parliaments are that—but not “the main source”, which is surely getting it a bit wrong. There is no good argument that cannot be spoiled by exaggeration.
The Commission’s response to our report is a good deal less satisfactory than that of the Government and falls far short of what is needed. Fortunately, that response was made by the outgoing Barroso Commission and not the Commission that is now in office. We can therefore hope that the first Vice-President of the new Commission—Frans Timmermans, whose name has been mentioned several times in the debate and who is responsible for relationships with national parliaments—will take a more enlightened and flexible view as matters move forward.
It simply is not good enough to say, flatly, as the Commission did, that it would require treaty change to allow national parliaments more than eight weeks to submit reasoned opinions under the yellow card procedure. It is not good enough to say that to allow those reasoned opinions to contain consideration of the proportionality of the Commission's proposals is not possible without treaty change. The Commission could perfectly well take political decisions to accommodate both those reforms. Let us hope that it can be persuaded to do so.
Nor is it good enough for the Commission to duck—as it did in its response—our recommendation that it should commit itself to withdrawing or substantially amending any proposal that actually triggered a yellow card. The outgoing Commission’s response to the yellow card triggered by its proposal for a European public prosecutor’s office has been referred to already in this debate. It was, frankly, scandalously inept, amounting simply to saying that 14 national parliaments had got it wrong and the Commission, as usual, had got it right. That sort of approach simply will not do.
When the Minister replies to this debate, I hope that he will concentrate not so much on the Government’s response to our report—after all, if we have taken the trouble to read Command 8913, we know what that is—but rather on what the Government are going to do about the many ideas in the report with which they say they are in agreement. What contacts have the Government had so far with other member states about the need for these reforms? What progress have they made towards building coalitions to carry them forward? What dealings have they had with the incoming Commission to persuade it to take a more flexible approach than that of its predecessors?
Anyone reading the recent speeches by the Prime Minister and the Foreign Secretary could be forgiven for thinking that this part of the reform—the issue of powers for national parliaments—was as evanescent as the smile on the Cheshire Cat. If so, that would be a major error. If we are to make progress, we surely need a broad-based, positive reform agenda that takes account of the views of all member states—not one that is tailor-made to the pressures from the UK Independence Party, which, in any case, is not the slightest bit interested in anything that leaves the UK as a member of a reformed European Union—and a reformed EU is, after all, the Government’s proclaimed objective. I hope that the Minister can give us a feel for the answers to those questions.
Lord Judd (Lab)
My Lords, I join those who have paid a real tribute to the noble Lord, Lord Boswell, for the leadership that he provides to the work of the committee and its sub-committees—and to the House as a whole for considering these matters. This report is profound and interesting; it raises major issues and deserves the close attention it is receiving in this debate.
There is a paradox, and I am glad that the noble Lord, Lord Boswell, made reference to it. We are all concerned about the accountability of the Commission but it should not become a ritual for us in this House to have an exchange with the Government about our frustrations about the too-many occasions when papers do not arrive in time for proper consideration and analysis. This is a major fault in the way in which we operate. I am getting rather tired of Ministers appearing opposite and saying how sorry they are, and how determined they are to work with officials in ensuring that the delays can be overcome. It never happens. It goes on and, in many ways, gets worse. There is a sort of arrogance in the machinery of government here that must be overcome, because the committee work can be only as good as the information on which it is operating—and this means excellent communication between departments and the committees.
In relation to that, if there is to be a future for the European Union—and I suspect that everyone in this Chamber on this occasion believes that the EU is indispensable and must have a future—it will be a healthy future only if there is a real sense that the member countries and their Governments belong to, are part of, and engage in that community. If too many countries and Governments—and I am afraid that the United Kingdom is a prime culprit in this context—are sort of on sufferance in the community and all the time wanting to tell their electorates and public how they are battling for the interests of their own people against this menacing and octopus-like operation in Brussels, we are not going to have a strong future. We have to belong. In the context of belonging, we must have the accountability about which we are speaking in this debate. Accountability’s muscle depends in the end on being aware of a widely based public opinion in member countries that this whole business is relevant to them—that they have an interest in it and want to ensure that those who claim to represent them are therefore playing the dynamic part that they should be playing.
Very often, the scrutiny that takes place goes on in spite of any feeling of public engagement. The public have come to see the European affair—the institutions of Europe; if they see them at all—as an elitist, closed community of those who are playing the European game. I am not sure that the public are totally wrong about that. Those institutions have become elitist, and those of us who have been involved in Europe in one way or another have become part of that reality. We have to re-engage with the public as a whole.
In that respect, I have a suggestion to make about our work in our sub-committees. We do not give the priority that we should give to ensuring that we get a social cross-section of witnesses coming to us when we are taking evidence. I have looked through the reports of one committee after another, and too often we are talking to members of our own political and social elite in Britain, with their views. It is important to talk to people who are in the front line of the reality of how society is or is not functioning, and about what the frustrations are. That means that a great deal more hard thinking has to go into considering: is this bunch of witnesses that we have assembled really representative of Britain and the people who are dealing with the consequences of the policies agreed in Europe? There is a real need for us to tackle that; and I cannot emphasise that too strongly.
I was particularly interested by the speech of the noble Baroness, Lady Smith of Newnham, which was refreshing and challenging. It raised certain issues, of course. Would it not be nice if we were not starting from where we are? Historians may well find it interesting to consider why we went for a directly elected European Parliament. When I was Minister of State at the Foreign Office, we were in the period of transition. I was uneasy about what was happening then because it seemed to me that among our own parliamentary body in Britain we were going to lose a degree of direct engagement in the affairs of the European Union. As happened then, people went from our Parliament to the European assembly and reported back to our Parliament. It was a broader basis of engagement. Parliament, through that process, was enabled and encouraged to see the relevance of what was going on in Europe to Parliament’s immediate affairs. Similarly, there are parliamentarians in the directly-elected European Parliament who are not as close to the reality of politics and frustrations of public policy, its implementation and contradictions as the people within the political system, whether British, French, German or whatever. That is an unfortunate divide. I do not see the clock being put back but we have to face up to it.
That takes us into another, much more profound, issue. As I listened to the noble Baroness, Lady Smith, she provoked me into thinking about it again, and it is not the first time that I reflected upon it. Perhaps we would have had a stronger Europe if we had gone for a more confederal Europe, as distinct from a federal Europe. The reality that we are coming up to is one in which we want a Europe of nation states that co-operate; that is the implication of everything that we are discussing; we want agreement between nation states. That is a sensible reality. Unfortunately, institutions that were established were much more in the context of a federal Europe. We have to face that and debate that. Furthermore, we have to ensure that our Governments, of whatever persuasion, are taking that ongoing reality seriously, because we need perhaps to get back to the confederal approach. I say that as a passionate pro-European.
It has been a very interesting debate so far. What I am more convinced about than ever is that we have to work at accountability. It is not just a matter of finding arrangements for better communication; it is a matter of politicians in different countries being able to work together, seeing much more of each other and developing a common demand of Ministers and the rest. It is also a matter of making sure that British society—a cross-section of British society at all levels—is drawn into our own work and feels that our work is relevant and that they can have a say in what we are doing.
Lord Maclennan of Rogart (LD)
My Lords, I also begin by felicitating the noble Lord, Lord Boswell, on his powerful speech. He has presided over the work of the Europe Union Committee with great distinction and great force. What he had to say at the beginning is, in principle, what the Minister has to reply to.
The public are largely unaware of the detail of what the European Union is doing. It seems to me that the Government have some responsibility for this and that we, as Members in Parliament, should engage more directly in giving indications of what is happening. If it were clear what was happening, I believe that the public would be much more supportive of the European Union than they are at present.
I was very proud to be a member of the committee that drafted the report. We have received a government response to it which is broadly sympathetic to the recommendations of the committee. However, I regret that the Government said, in their answer to the question about the scrutiny of what would happen at Council meetings:
“In practice a pre-European Council session would be of limited value given that the Minister would be unable to disclose the details of UK negotiating aims publicly and that the agendas, and certainly the details, of such meetings are often finalised at the last minute”.
If the Government respect the role of the national parliament in the European Union, it should—and it does now—disclose broadly what is to be discussed at the European Council meetings. It would provide an opportunity for Parliament to express its views, which the Government could take into account in their negotiations. I wholly accept that diplomacy may lead to bargaining or to changes of agenda at the last minute, but broadly it is known what European Councils are about to discuss, and it would be helpful if the advisers included the parliament itself.
However, the involvement of national parliaments in the business of the European Union is quite strongly supported by the Government. I particularly want to refer to the green card process. That seems to be an innovative suggestion, which could lead to a greater recognition of the national interests, particularly if it is backed by the requisite number of other national parliaments and Governments. It is preferable having to table reasoned opinions, which may lead to yellow cards, a process that has not so far been effective, as was mentioned earlier in the debate. It is vital that the national parliaments, reflecting the needs and opinions of the public, are engaged at a very early stage in the legislative process; I think that is really beyond dispute, certainly in this House. It is encouraging that the new Commission has indicated that it would be responsive to national parliamentary opinion.
What is most lacking at present is the procedure for bringing forward the recommendations of this committee. The Government have indicated that they approve, broadly, of what we have said. So far, however, they have not given us any indication of how they might render those innovations effective. That is something that cannot be left entirely to the national parliaments themselves, although we have the power to open up discussions with other national parliaments, and no doubt we will do that. But the Government have influence, through Council meetings, on this sort of development, and I would very much like to hear how the Government propose to exercise that influence. It is a complex business for a parliament to negotiate with 27 other parliaments and with the Commission. We do not have an institutional arrangement that can facilitate these matters, but, as has been said already, modern technology enables us to get our views across and to engage with individuals. I totally agree with the proposal that we should get much closer to individual serving Members of the European Parliament, the Commission and even other Governments.
It might be possible to invite COSAC to consider these proposals in a special session. The agenda would need proper predetermination, and I think that it would be responded to positively. The present agendas of COSAC, referred to in the report, are unsatisfactory in that too often Governments talk de haut en bas, and the Commission talks de haut en bas to the members, and they do not allow time for adequate consideration to be given to the reactions of national parliaments.
The issue of this Parliament’s resources has been raised in the report and there has been some uncertainty about the Government’s response. I do not think we have made a sufficiently strong declaration about how we can be informed about what is happening in the European Union, or on how to convey our opinions on what is happening to the other members. We have a very effective Member speaking for our national Parliament in Brussels; she is an extraordinarily capable person and helps very considerably. However, because there are so many functions in that job, it might be reasonable to have more than one person: to have someone who engages with other member countries and other Members of the European Parliament on what the Commission is doing, and who keeps in very close touch with those whom our representative seeks to assist.
One of the basic problems of our membership of the European Union is the lack of interest of our electors. I do not mean this Chamber’s electors, but the electors in this country. That is, in part, the fault of a defective press and an inadequate media response to what is going on. Too often the reports are negative; too often the positives are not even ventilated. I hope that the BBC might engage to a greater extent with Members of the European Parliament, with members of the committee and generally with the issues, so that voting does not generally decline.
I conclude by reporting that the Government have stated, in their response, that they are,
“keen to work with Parliament to strengthen the system further”.
I hope that when my noble friend the Minister comes to respond to the debate, he will indicate in what ways that can be done.
The Earl of Sandwich (CB)
My Lords, the idea of strengthening the role of national parliaments in the EU looks, on the surface, fairly obvious. The EU has gradually acquired additional competency and the Lisbon treaty, while giving more power to the European Parliament, has not led, as was intended—as we were reminded by the noble Baroness, Lady Smith—to a parallel development between the Commission and the parliaments of member states. However, the more I read about subsidiarity and reasoned opinions—I have to acknowledge early training in the old Sub-Committee E under the noble Lord, Lord Bowness, and our very patient legal adviser Mike Thomas—the more technical and legalistic are the arguments behind these Lisbon concepts and the related solutions. Today, for my own self-preservation among other things, I propose to step back to try to understand the view of the ordinary citizen.
To the UK public, Europe is still the continent: it is a vast bureaucratic union opposite our southern shores, which sends us regulations and with which we have to do business. People do not feel that they truly belong to it. It is a power bloc with which we need to trade and only an older minority—like most of us here—feel the emotion of solidarity since 1945, which bound the original founding fathers. The undoubted advantages of the single market and of political co-operation escape the ordinary citizen. I hope the noble Lord, Lord Judd, is right that we can correct that in time, although I have my doubts.
The more visible agenda is the athletic political stance of our Prime Minister, for whom there has to be a degree of sympathy. He has quite rightly aligned himself with reform and a gradual repatriation of national sovereignty. However, being British, he is also a bit of a loner: he stands out at EU summits—not unlike Mrs Thatcher before him—as an independent but somewhat isolated figure defending the nation of shopkeepers, while for some he can even be a source of fun or irritation. With his left hand he has to hold on to his coalition partner; with the other, as we approach the election, he is making increasing overtures to the right wing of his party and to potential defectors.
We all know the Prime Minister to be a pro-European at heart, but does he have what has been called a “Lust für Europa”? Is the UK still enjoying the luxury of not having been invaded in the last war? Can we overcome our island mentality, which makes us permanently different, difficult and ready to criticise, or do we have to make a virtue of it? Some of us were in Berlin a fortnight ago. We heard German Members of Parliament from the two Bundestag committees imploring us to stay in the EU to support a strong EU line against Russia, which is desperately needed at the moment. But why should they think we would leave the EU? Are we so aloof that we must continue to keep them guessing?
Political manoeuvring with the referendum and treaty change explains some, but not all, of this. I recognise that reform has been too sluggish. There were tactical arguments, for example, behind the recent opt-outs and opt-back-ins. I acknowledge that the UK is, in practice, an equal partner in the legislative sense. We take a lead in EU scrutiny through a range of committees, as I can see at first hand. Since the recession, there has also been a lot of alarm about the eurozone and whether there will be a two-tier Europe, but because of our strong financial position we have remained in that discussion. That is all good. Nevertheless, despite all that, I look forward to the day that we can pass on the role of prima ballerina to someone else.
Turning to subsidiarity, I have studied the two very helpful reports by the University of Copenhagen and the Tweede Kamer. The Danish analysis is fascinating, showing how national parliaments have suffered from disempowerment since Lisbon. We should all be encouraged by the acceleration of decision-making and the rapid rise of genuine early agreements in the European Parliament, which accounted for two-thirds of adopted proposals in 2012. However, this means that, as national parliaments, we need to do much more pre-legislative scrutiny. As has been said, we need to question Ministers before Council meetings as well as after. The Commission’s response shares this view and says that,
“very few national parliaments make their views known”,
at an early stage. That is very surprising. The voice of concerted national parliaments surely must be heard on the most important issues—yellow and green cards have been mentioned. As a member of the Select Committee, I was equally amazed and frustrated that the legally required number of reasoned opinions on the EPPO was still not enough to jog the Commission into action.
This attitude will surely change under President Jean-Claude Juncker. After all, he has promised to raise the profile of national parliaments and we must keep him to his word—whatever the Prime Minister’s view of his method of election, he will certainly find allies in this House on that subject. Perhaps he will pick up the suggestion made by the noble Lord, Lord Tugendhat, for a new Commissioner for Parliaments. I hope that he will.
Apart from that, the Tweede Kamer report sensibly recommends a more active stance in interparliamentary co-operation. The noble Lord, Lord Davies, went into that, but I do not think we made enough of it in our report. It is not easy, as has been said, and it can only work on single issues that draw like-minded parliaments and connected Members of the European Parliament together. Our Select Committee has discussed how that might be done in relation to reasoned opinions. One obvious practical suggestion is that the two UK Houses should increase their present liaison staff in Brussels. Strengthening the Commons Select Committees has also been mentioned, as has mainstreaming. Another solution is, of course, improving COSAC, which is a very long-term project. That could become a less formal and more flexible institution, although that also has its limitations.
It is often said that this House operates a better system of scrutiny and reporting than, shall we say, most other EU chambers. Should we therefore reach out a little further into Europe and hold seminars on topical issues of subsidiarity that might attract MPs and MEPs from other nations? The imperative in the EU always seems to be aiming for uniformity, but we already have disunity. We have natural coalitions with the Dutch and Germans. We could, for example, work more closely with Poland and the more recent EU members in eastern Europe.
I have said enough, but I stand by the recommendations in our report and I hope that they attract a much wider readership throughout the EU. The Government already mainly agree with us and the Minister is bound to say that this is a matter for Parliament. All the same, I am sure that he will be more generous than that and I look forward to what he is going to tell us.
Lord Inglewood (Con)
My Lords, no one who has heard the debate this evening can be under any illusion that the topic we are discussing is not very important. I add my congratulations to the noble Lord, Lord Boswell, and his committee on the work they have done.
It was about 30 years ago when I began my involvement in political life when I stood as a candidate in the European elections in County Durham. It was not an especially glorious chapter as I got beaten by 55,000 votes, but it was a start. Nevertheless, even though I was inexperienced then I appreciated that the European Community, as it then was, was a sui generis type of institution that shared systems of government from both parliamentary and diplomatic traditions. It seemed to me that there were only two reasons for this. First, and we sometimes forget this when we are debating these things, different parliaments in different countries operate in really quite different ways. Secondly, the scale of what was involved was much smaller and seemed to be more aligned with what diplomacy traditionally did.
Of course, it is 30 years on now and the world has changed and the European Union with it. Economic integration, improved transport and communications and movement of people have changed the way people live and work not only in the Union but right round the globe. The role of the European Union has become functionally much more akin, it seems to me, to what states traditionally used to do than was the case then. At the same time, the diplomatic attributes of the EU’s modus operandi are much less prominent than they used to be. I am very glad that the member states are still the principal building blocks of this institution but we need to be clear that as the world changes the way in which nation states—and in the case of the European Union member states—work is going to have to evolve. One of the difficulties is that the role of national parliaments has not evolved in the same way as the European Economic Community became the European Community and then the European Union.
I should like to turn briefly to the report itself and break it down and focus on some of its themes. Scrutiny is perhaps the most prominent theme and is still probably the most important attribute of the engagement of national parliaments. I agree here very much with my noble friend Lord Tugendhat, who said a number of wise and sensible things. One of the most wise and sensible was that scrutiny of Ministers in the Council of Ministers should be enhanced. Certainly I had a brief spell when I was a departmental Minister of going to the Council of Ministers and nobody wanted an account from me about anything I was doing. From a purely personal point of view it was one of the most exhilarating parts of my political career. I think one brief discussion with my Secretary of State over a cup of coffee was the whole measure of it. I have wondered against this background whether Parliament as a whole might not be wise to revisit its general approach to European matters, which was put in place by Sir John Foster several decades ago.
I was also interested in the point made in the report about wider, less specific formal scrutiny, because in recent years most of the work I have done in this House has been with the Communications Committee and the Extradition Law Committee. That work has suggested to me that there may frequently be important European aspects that take a bit of digging out. I am particularly thinking of the significance of competition policy and regulatory policy in the context of media markets and communications—because I spent 10 years in the European Parliament I probably was more conscious of these aspects than many other Members.
I turn now to what might be described as the personal institutional engagement that could be enhanced between the Commission, Parliament, COSAC and so on. The idea is absolutely excellent but the noble Baroness, Lady Quin, is right that the problem is finding the time to do it because the laws of physics are still such that you cannot be in two places at once. I listened with very great interest to my Cumbrian neighbour, the noble Lord, Lord Judd, but when I was in the European Parliament—and you could do it then—I had the dual mandate. Given the workloads that apply in each of the two places I simply do not think it is possible to revert to doing that in the old way. Therefore, it is dangerous and misleading to try to overplay and over-rely on the ability of individuals, whether MPs or Peers, to engage fully in very extensive ongoing dialogue, because of their other commitments—although I add the proviso that it would depend on whether the way Parliament works changes or not, and I will touch on that briefly in a moment.
Like a number of noble Lords, I think that the reasoned opinion provision is an interesting and radical development, because on a very small scale it gives national parliaments a place in the legislative process. That is very important and something that should be worked on. The report said that there was no interest in treaty change; we have touched on it this evening. However, despite protestations to the contrary, the kind of changes that are being called for across Europe are such that certainly in the old days I doubt they could have been put into effect without treaty change—although, speaking for myself, if clever lawyers can find ways round, good luck to them.
In recent years, much of the background to the discussion and focus on the role of national parliaments in the European political system has been based, as has been said, on concerns about the European Union’s democratic deficit and its lack of popular legitimacy. This was a point the noble Lord, Lord Wilson, raised. However, we in Parliament need to be very conscious of some of the criticisms that have been levelled against Westminster recently. An awful lot of the traditional criticism of the European Union we now hear levelled against us here. It may follow from that that, as time goes by, our own terms of reference change. It seems to me inevitable that the role of national parliaments, and indeed the part that member states can play in a globalising interdependent world, are inevitably going to change and we no longer here have a Parliament set in a world that would be familiar to a Bagehot or a Dicey. Therefore, when we look forward we must tailor our thinking to what we recognise as the likely shape of the world as it will become.
Finally, I cannot recall any House of Lords report so enthusiastically endorsed by the Government. I have to admit that that makes me a bit concerned. However, it suggests that they too are finding the wider world a very perplexing place at present. I suggest that they might endorse their general stance in these matters by prioritising the importance of scrutiny and Ministers making themselves available for scrutiny as their number one priority.
Lord Bowness (Con)
My Lords, as a member of the European Union Select Committee at the time of the preparation of this report, I, too, thank the noble Lord, Lord Boswell of Aynho, both for his comprehensive introduction of the report and for his guidance and chairmanship during the inquiry. It goes without saying that I support the conclusions and recommendations in the report. I want to emphasise one particular aspect of the report, express a concern and put two matters on the record, not so much to Ministers as to the usual channels and parliamentary authorities.
The aspect that I wish to emphasise is the need for enhanced contact and working with the European Parliament and its members. If our scrutiny is to be effective and we wish to try to ensure that our views are reflected in the final version of European Union legislation, it is vital that we build relationships with the chairmen of committees, the rapporteurs and, indeed, the spokesmen and spokeswomen of the important political groups in the Parliament. It is important, too, to remember that the European Union Select Committee and its sub-committees are there not just to scrutinise the draft EU legislation but, as many Members have said today, to hold Her Majesty’s Government to account in the way that they approach these matters.
Co-decision presents us with significant challenges in knowing what may happen at various stages—particularly the first reading deals, referred to in the report. We need robust systems which will enable us further to scrutinise measures when substantial changes have been made to the proposal originally scrutinised. Agreements as to working practices between the European Parliament, the Council, the Commission and other national parliaments are what are required, not treaty changes, and these will, I believe, be easier to achieve when personal relationships are established.
The concern that I have is this: a national parliament’s view of a greater role for national parliaments may be rather different from that of a national Government, which may espouse the cause of greater power for national parliaments. I believe that we have to be careful to ensure that national Governments, including our own, do not seek a greater role for parliament if the motivation for that greater role is to use a whipped majority to support a government view as a way of circumventing the decision-making processes of the treaties. To do that in the extreme will lead to a slower and less efficient decision-making process in the European Union and undermine the position of the European Parliament.
The so-called democratic deficit will not be solved just by national parliaments and national Governments proclaiming themselves to be the only keepers of the democratic flame in the European Union. There is a real role for the European Parliament, and I am pleased to say that the report recognises this. We in the United Kingdom do not always help to dispel that deficit. There has in recent months been much questioning of the candidacy of Mr Juncker as Commission President, with it being said that we in the UK knew nothing about the campaign during the European elections and that therefore the positions adopted by the parties in the European Parliament were somehow irrelevant and not justified. But, quite simply, we did not engage in the way of the other member states. There was election literature in all the languages of the European Union and there were televised debates. Of course, I have to say to my noble friend on the Front Bench that the United Kingdom Government could have had an input into the choice of right-of-centre candidate had the Conservative Party still been associated with the European People’s Party.
My last points I address to the parliamentary authorities and the usual channels, and perhaps, in their absence, to Treasury Ministers, as there are not many pies in which they do not have a finger. Relationships with the European Parliament, the Commission and national parliaments are important, and many of the proposals in this report require resources in terms of staff and Members’ time. I do not believe that those relationships can be built initially just with video links. As the noble Lord, Lord Davies of Stamford, said, people need to meet people—at least initially. So, although I am not advocating a merry dance around the capitals and parliaments of the European Union, I believe in those personal contacts.
Likewise, the European Union Select Committee and its sub-committees cannot carry out the work of scrutiny and holding the Government to account without the necessary support. We have very great support through the committee and its sub-committees but it would be a brave individual who suggested that in some way there was any element of slack in that support.
My last point will, I fear, not be heeded because it would involve a change of a decision already made by the House and is likely to be dismissed as special pleading, but I put it nevertheless. The proposal which has been agreed regarding length of service on a committee, and particularly the decision to treat the European Union Select Committee and its sub-committees as one—and the retrospective nature of that decision—will, I understand, mean that some two-thirds of the existing members will no longer be able to serve for at least two Sessions of the next Parliament. Of course, I accept what my noble friend Lady Smith of Newnham, said—that there is a need to involve as many Members in EU matters as possible, and that it be seen to be a part of mainstream politics and not a specialist interest. It is regrettable perhaps that today, as the noble Baroness described it, only the usual suspects are present.
Nevertheless, having said all that, I believe that the Select Committee, under both its current chairman and his distinguished predecessors, has built an enviable reputation across the European Union. That is at least in part due to the fact that a body of knowledge of issues and people has been built up over the years and members have acquired experience in a wide variety of different areas of EU activity. There is a corporate memory which may well be lost with the rapid turnover which is now to become the norm. I hope that someone may think again on that issue.
Lord Jay of Ewelme (CB)
My Lords, my first point, which others have made before me this evening, is that the role of national parliaments and the role of the European Parliament do not constitute a zero-sum game. An increase in the powers of one does not imply a decrease in the powers of the other. The EU is a highly complex set of institutions, with shifting relations between them. The European Parliament has a key role, as is evidenced by the amount of time and money that lobbyists—including lobbyists in this country—spend seeking to influence it. On some issues, such as the environment, NGOs see it as a powerful force for good. Perhaps I may say in parentheses that I was delighted to hear on the “Today” programme this morning a representative of the RSPB—of which I am delighted to be a member, along with more than 1 million of my countrymen—paying tribute to the wild birds directive for helping the great bittern to boom and flourish in the wetlands of our country.
Yet, despite the booming bittern, there is no doubt that for many—indeed, I suspect, for most—citizens of the EU, national parliaments are seen, and in my view will continue to be seen, as the fundamental guarantor of the democratic process, despite the shifting views of our national parliaments, as described by the noble Lord, Lord Inglewood. I think I am right in saying that in every single European Union country, national elections count for more than European elections. Given the recent quite dramatic growth through much of the EU in disenchantment with the EU and its institutions, as shown in the last European Parliament elections, it is of very great importance for the continued democratic legitimacy of the EU as a whole that the role of national parliaments should be clear, should be well understood and should be increased.
It follows that the British Government are surely absolutely right to emphasise the need to increase the role of national parliaments as part of the reforms they would like to see to the EU and its institutions. As others before me tonight have said, there is much that can be done in that regard without treaty change.
Equally, the Government’s hand will be greatly strengthened in their negotiations with other member states if they are seen by their EU colleagues to be taking their own EU scrutiny responsibilities seriously. Of course, very often they do—but, to take just one example and to follow the noble Lord, Lord Boswell, the Home Office’s rather cavalier approach to its scrutiny obligations in respect of police and judicial co-operation seems not only to be wrong in itself but to prejudice the Government’s broader objective of winning their partners’ support for a stronger role for national parliaments within the EU structures. I look forward to the Minister’s assurance that this was only an aberration.
That does not mean that there is no scope for streamlining the scrutiny process, for example over the depositing of documents. This should be reviewed jointly by both Houses and by the Government—but, in the mean time, it is hugely important that the Government take their own scrutiny obligation seriously.
I agree with one point that was stressed by the Government: the need for a more systematic approach to scrutiny during the recess. EU business, particularly the foreign affairs issues considered by Sub-Committee C, does not stop between August and October, and should still be subject to parliamentary scrutiny. Some way needs to be found to ensure that this happens, perhaps by means of an ad-hoc committee drawn from the Select Committee itself and the different EU sub-committees, which could meet from time to time during the recess.
I will make only two other points, one of which is procedural and the other substantive. The procedural point is to endorse the idea that the National Parliament Office in Brussels should be strengthened. I very much agree with the noble Lord, Lord Maclennan, on that, and I echo his point that it is in no way at all a reflection on the quality of the present incumbent. The point is simply that if the role of national parliaments among the Brussels institutions is to be strengthened, we do need to find some way to have a stronger link between national parliaments and the institutions in Brussels and Strasbourg. I very much hope that that can be pursued.
Finally, I strongly support the strengthening of the reasoned opinion procedure, in particular the extension of the scope of the procedure to include proportionality. There is a need to ensure that the Commission takes seriously its duty to review a proposal when a yellow card is issued—again, as was said by the noble Lord, Lord Boswell. This should not be seen as giving way in an institutional battle between the Commission and national parliaments, to the detriment in some way of the European Parliament. It should surely be seen as a way of assuring national parliaments—and, through them, those who vote for them—that the concerns of citizens really are being taken into account and listened to, thereby strengthening the democratic legitimacy of the EU as a whole. That is surely what we all agree is needed.
Baroness Morgan of Ely (Lab)
My Lords, I thank the committee and the noble Lord, Lord Boswell in particular, for the excellent work that they have done in this report. It has been an urgent and necessary task to look at, and to try to do something about bridging, the gap between the legislatures and the public. That is certainly true in terms of EU legislation and the citizens of the European Union. The distance between elected representatives and the public is certainly a problem. It is a problem for the European Parliament. It is probably fair to say that, in general, people relate more readily to national parliaments, so how national parliaments relate to EU law is absolutely critical. It is worth taking note of the wise words of my noble friend Lord Judd in terms of how we engage people beyond the usual suspects and try to go beyond the elite when we are taking evidence. That may go some way to bridging that gap.
I served 15 years as a Member of the European Parliament. I can tell noble Lords that during that time, the Lords European Union Committee was the best example that we had of how national parliaments interacted with the process of EU legislation. Yes, there were some good examples in Holland and Denmark as well, but the fact that this House took that responsibility seriously was noted. It therefore makes sense that your Lordships’ committee is the group that comes up with practical reasons for why national parliaments perhaps find difficulty in influencing EU debates and provides some constructive suggestions about how some of those problems can be overcome.
The report recognises that national parliaments have a dual responsibility in relation to EU law, not just in scrutinising their own Government’s positions on EU policy, but in influencing more directly EU institutions and proposed laws. The authors have correctly identified that a national parliament holding its own Government to account for its EU policy positions can be done now. It is a matter of the will of parliamentarians and of their Governments to effect that will. As the noble Lord, Lord Boswell, said, the UK has to put its own house in order when it comes to this.
It is worth noting that the House of Commons Library reported that the number of laws influenced or based on EU law varies between 15% and 50%, depending on the definition. Knowing that, does Parliament have the balance correct in terms of the time and resources set aside to scrutinise these laws, given the number and quantity of laws emanating or being influenced by Brussels? Let us be clear. These laws are not decided by Brussels: they are proposed by Brussels. No EU law is passed without the UK Government having been involved in detailed discussions in terms of the outcomes. But the Government need to be held to account by Parliament on their position in relation to EU law.
A point not picked up in the report is the fact that it would be extremely difficult for some Parliaments, including the UK Parliament, to keep up with legislative scrutiny of EU laws, as we sit for only 30 weeks a year, compared with the 45 weeks a year that the European Parliament sits. That point was made by my noble friend Lord Judd. We need therefore to take seriously this point of prioritising the laws on which to focus.
Some of the major decisions that are made in the EU, which set the political direction and tone for various debates and forthcoming EU laws, are made, as has been pointed out, in the European Council meetings. The suggestion by the committee of holding pre-Council scrutiny meetings to feed into government preparations, rather than holding them afterwards, makes eminent sense. However, due to the fact that the Government are by definition entering into a negotiation, we understand the need to be sensitive to the view that requiring the Government to disclose their negotiating plan in public would not necessarily be in the interests of the UK. But that does not mean that they cannot listen, as the noble Lord, Lord Maclennan, suggested.
Lord Davies of Stamford
Is not the simple solution to this problem that these pre-decision scrutiny sessions should, where necessary or when the Government so desire, be held in private? I understand that that works in Denmark. There is no problem with leaks and the system works perfectly well as a result.
Baroness Morgan of Ely
That makes a lot of sense. As long as there is an understanding that sessions are held in camera, I see no problem. But accountability pre-scrutiny and pre-Council makes sense. It is something that we should perhaps take up.
In terms of influencing EU institutions more directly during the process of elaborating legislation, the process becomes more complicated. For me, one of the problems when reading the House of Lords European Committee reports as an MEP was that, despite their brilliance, they would almost invariably be published after the law had been passed. Although there were some gems in there, in terms of critiques of EU directives, they were too late to influence the debate—which is why that pre-legislative scrutiny by national parliaments would be invaluable.
Analysing the Commission’s work programme would be an obvious way of ensuring a degree of pre-scrutiny, and it should become a core task—as has been suggested—of the whole Parliament and all the relevant Select Committees, rather than the preserve of EU committees. Furthermore, will the Minister comment on how we get a degree of consistency, as referred to by my noble friend Lady Quin? How do we ensure that there is a systematic approach to thorough, ongoing analysis by subject committees?
It is also essential that policymakers have a thorough understanding of the legislative processes of the EU institutions. In my experience, that was not obvious, even—dare I say it?—when dealing with some of the UK Ministers involved. So, mainstreaming, as the noble Baroness, Lady Smith, mentioned, is critical.
The committee’s suggestions for tightening up the reasoned opinion procedure make sense, and the fact that only two yellow cards have been given since the introduction of that system suggests that the hurdles may be too high. I note, however, that the expectation that the Commission should respond within a set timeframe is possible only if resources are provided. Imagine the resources involved in giving a comprehensive response to the 2,000 written contributions made since the Barroso initiative was introduced. There were 33,000 members of staff in the Commission last year. Let us compare that with the number of staff employed in the Department for Work and Pensions: 90,000. Just imagine the extra burden on the administration in answering 28 member state parliaments within a tight timeframe. Something would have to give; something would have to be prioritised. We need to be sensitive to that when we are asking for these things.
National parliaments, however, need to learn how, and when best, to influence the EU legislative process. It is worth considering the suggestion by the noble Lord, Lord Davies, of an annual get-together, but more relevant is a real understanding of how influential individual MEPs can be, particularly those who lead and formally shadow debates and who navigate the directives through the legislative process—that is, the rapporteurs. They are extremely influential, so identifying who they are and communicating with them at the appropriate time would be as impactful as trying to convince 28 different EU member states to take up an alternative position. There is no inconsistency in saying that national parliaments, as well as the European Parliament, should be involved in developing EU laws. Like the noble Lord, Lord Hannay, I must say that I am disappointed to read that the real source of democratic legitimacy in the EU lies with national parliaments, according to the Government’s response to the report.
As the noble Lord, Lord Tugendhat, suggested, it is worth thinking about some of the ideas put forward. I fully endorse the point that the Conservatives have cut off their own influence in the EU by ceasing to be a member of the largest political group. It is worth considering the idea of a commissioner for national parliaments and European parliaments, but I warn that there is a danger that the job might be seen to have been done, and therefore the departmental commissioners might not take their responsibilities seriously in relating to national parliaments.
With such turmoil in the eurozone, the reality is that the public across the whole of Europe have learnt that financial and economic policy emanating from the EU is impacting on us all both directly and indirectly, whether through the massive austerity measures that have caused such savage cuts in our public services, or through reduced demand for our export goods. Therefore, national parliaments should take a more systematic approach to the surveillance of this policy area in particular.
On behalf of the Opposition, I thank the European Union Committee for its work on this report. It is essential that it is disseminated not just in our Parliament, but in parliaments throughout the European Union.
Lord Wallace of Saltaire (LD)
My Lords, this has been a rich debate which has ranged widely from the lack of a European demos to the future of Britain’s role in the European Union, to the popular disenchantment with the European institutions across much of the EU to the role of COSAC. Having read the report and having listened to the first two or three speeches, I must say that I was beginning to think that COSAC had improved enormously since I was last a member. Then I heard the noble Earl, Lord Sandwich, almost say that it might take another generation before COSAC becomes an effective body. I remember eating very well when I went to COSAC and some of the discussions were useful. However, all that was a long time ago, and I am sure that it has improved a great deal.
The British Government do accept that the European Parliament, the British Parliament and other national parliaments have complementary roles. We absolutely insist as part of our proposal for European reform that national parliaments need to be more actively engaged and that relying on the European institutions alone to provide legitimacy is no longer acceptable, possible or publicly achievable. We all know about the negative image of the European Union—the image that UKIP puts out that the EU is attempting to accumulate more and more powers in Brussels and has to be resisted so that power is pulled back. I am old enough to remember the old idea when I first went to meetings in Brussels and elsewhere when we were discussing joining the EU that it was there to replace national Governments. National Governments represented the old way and national parliaments were part of that. Jean Monnet, who hated the French National Assembly and was never himself a parliamentarian, believed that technocracy was much better and more efficient than democracy. There were those like Altiero Spinelli who had a passionate belief that the European demos was there, somehow, to be discovered, if only one worked hard enough for it.
We have discovered in the generations since then that it was not really there, that all politics remains local, and that the problems we are now facing are that while politics remains local, economics, finance and markets have become international and often global, security has become international and often global, and the gap is one that we are all struggling to fill. We also had a number of discussions about rivalry between the European Parliament and national parliaments, with the European Parliament sometimes claiming greater legitimacy because it represented the European demos. I recall one Member of the British Parliament attending the convention when the European Convention met and feeling from the start that she was being patronised by Members of the European Parliament. She became and she remains a rather sceptical Labour MP.
There is something of a Brussels bubble. We understand that Brussels does need a culture change, and I listened with interest to the optimism expressed about the new Commission, perhaps about the new European Parliament, and abort some of the new Commission officials. Again, I mark that we do not send enough British officials to the Commission for a whole range of reasons. I am glad that my own Government have reinstituted the European fast stream and are working to try to get more British officials to go through the concours and to come in as seconded national experts at all levels because that is part of the way we can change the culture of Brussels.
Lord Spicer
The Minister is making an extremely interesting point about the gap between the demos and the economics, as he put it. Is not the reason for that gap, which will always exist, that the Parliament will permanently be constrained by two things? The first is the European Court and the second is the treaty, which was the subject of a little discussion between me and the noble Lord, Lord Boswell.
Lord Wallace of Saltaire
With respect to the noble Lord, Lord Spicer, I was making a slightly different point, which is about the global market and global manufacturing. The fact that, for example, when the French sell an Airbus a third of the value added to that Airbus comes from British manufacturers, and that every time the Germans sell a Mercedes, it contains a large number of British components, means that markets have gone beyond the nation state but legitimacy has not. That is a fundamental, structural problem of the world in which we now live. I will not touch on the migration dimensions of that, but the security dimensions are also extremely difficult. That leaves us with a set of dilemmas which are not solvable and which we have to cope with.
A number of noble Lords made the point about the resources and time required. Resources are needed for scrutiny, as the report suggests. If we are setting up for national parliaments to be more closely in touch with each other, that requires a good deal of travel and time. One noble Lord remarked—it may have been the noble Lord, Lord Inglewood—that, in some ways, a European Parliament that was drawn directly from national parliaments was more appropriate. However, it did not work before 1979, partly because national parliamentarians are elected to serve constituents in their national parliament and the more time we expect them to spend elsewhere, the less time they will have to do their primary job. So there is a set of real problems there.
I noticed, as a member of the Government talking to newly elected MPs—there was a very large turnover in the British Parliament last time—that a great many newly elected MPs coming from outside politics had very little idea of the complexities of international negotiations in which we are engaged with other European parliaments, or of the contacts one needs to have with members of other national parliaments or, indeed, members of the same political family as yours in other Governments. They have learnt, but it takes time. After all, more and more of our parliamentary candidates, I saw in one newspaper at the weekend, are now being drawn from people who have established roots within their local constituency. They are not elected to Parliament because of their international experience and they are unlikely to get re-elected if they spend too much time travelling around Europe and beyond. That is one of the obstacles with which we have to deal.
The new Commission has signalled that it is open to a much more positive dialogue with national Governments. New President Juncker has stated this on a number of occasions; Vice-President Timmermans, as has been remarked, has made it very clear that this is one of his priorities. As a Minister in the Dutch Government beforehand, he was already heavily committed. Closer co-operation among national parliaments was mentioned by many noble Lords. The offices which we now have in Brussels are to be strengthened. It is a very good way of using Brussels as a means of communication that enables you to find out earlier what is going on, examine proposals at an earlier stage and talk among national parliaments about how one might use yellow cards—lowering the threshold. The green card question is a very interesting one which the Government will wish to consider. We are not yet committed. We note the proposal that the coverage of these mechanisms should be extended to cover proportionality as well.
The noble Lord, Lord Bowness, talked about first reading deals. One of the problems that the Government have in responding to that is the sheer complexity of a multilateral negotiating process, with co-decision with the European Parliament, the Commission and the Council of Ministers coming in. The points at which national parliaments insert themselves into that process and how national parliaments keep up with that process is, again, part of the problem with which we all have to deal. Over the past year, as I have struggled with the EU balance of competencies exercise—a fascinating exercise—I have changed my mind on whether it would be useful for this Chamber also to examine other international organisations through which the British Government work. Time and time again in the EU balance of competencies exercise we have had evidence which has said, “We work through the EU on this, and we also work with OECD or the World Health Organization”. Indeed, the EU operates in some respects as a regional member of the World Health Organization in specific areas. Explaining that to the national public, as far as we can, and examining how effective those other international organisations are—most of them are a great deal less effective than the European Union—is perhaps also something which this Government might be able to achieve.
The noble Lord, Lord Judd, remarked that perhaps it would be easier if we explicitly had a confederal Europe rather than a federal Europe. I thought the chapter in this report on economic governance was particularly interesting and difficult because the contradictions of where we have got to with international markets come in because you need some power to decide as soon as you have an integrated single market, let alone a common currency, and when you face a global economic crisis, the legitimacy to decide above the level of the nation state is not there. So we are again stuck with the problem that it is not possible to reconcile the principles of democratic accountability and legitimacy and the need to take these decisions among a range of different actors.
Lord Judd
Is it not highly relevant here to recognise that in what the Minister is saying about what has happened to international finance, the real discussions that influence policy are going on in the G7 and places such as that? In this sense, it gives us room to reconsider the structures that built up before this was of such manifest significance.
Lord Wallace of Saltaire
My Lords, I suspect that any incoming British Prime Minister does not begin to understand just how much of his time he will now have to spend out of the country dealing with other Governments and so on. One of my very small roles within government has been trying to say, “No, the Deputy Prime Minister cannot go to that international conference, in spite of the fact that he speaks the language”, or whatever it may be. The pressure on Ministers to travel, particularly those in the British Government who have much more pressure to spend time being accountable in Parliament and to parliamentary committees than many of our counterparts, is among the real strains that I see our senior Ministers facing.
On consulting the public, I shall briefly remark on the balance of competences exercise. The final report will be published this Thursday. The two-year exercise has consulted British stakeholders on the single market and a range of other areas. We have had more than 2,000 pieces of evidence from a very wide range of organisations—economic think tanks and others—and have attracted contributions and evidence from more than two-thirds of the other member states.
One of the most pleasing aspects of it has been to hear people in other Governments saying, “This is a very useful exercise. We should do something like it ourselves”. People within the French Government, the Dutch Government, the Finnish Government and others have said the same. One of the small achievements of this coalition Government has been to consult widely on how far the current arrangements under the Lisbon treaty suit British business, British interests, British trade unions and others. I cherish the evidence from easyJet, which began, “If it were not for the European single market, easyJet would not exist”.
The noble Baroness, Lady Smith, touched on the exchange of information between national parliaments and Brussels. I welcome her as someone who has made the transition from being a witness before committees of the House of Lords to being a Member of the House of Lords—a route that I remember transiting myself rather too long ago.
The question of how far we co-operate with other national parliaments raises some difficulties. There are other national parliaments with which we are in very close touch. There are others which do not have quite the same style or tradition. Two years ago I had lunch with the chair of the European affairs committee of a particular national parliament, who did not seem to have the sense that he should ever criticise his own Government or should disagree with their approach to Brussels. It was a rather surreal experience.
Some, however, are very active. I note, incidentally, from the table in Appendix 6 of the report that second chambers in several countries are much more active than first chambers. We are not the only ones who are able, because of our second-chamber status, to do what we can.
The European Union is, of course, a political system. How it works depends on how actively different institutions engage with it. We wish, as far as possible, to encourage other European parliaments to engage with us. The noble Lord, Lord Hannay, asked about the government response and how this fits in with the Government’s reform agenda. I remind him that the Foreign Secretary, my right honourable friend Philip Hammond, is engaged in active conversations with other national Governments. He has so far visited 11 national capitals. The feedback he has been getting demonstrates very clearly that there is an achievable, broad-based reform agenda shared by many other Governments which does not require treaty change.
Indeed, other Governments are vigorously saying, “We can do this without treaty change”. It is achievable within the headroom provided by the Lisbon treaty, and it covers a stronger role for national parliaments, effective regulation, the budget, completion of the single market in areas such as services in which the obstacles come from Germany rather than from Britain and others, the digital single market and so on. We have an active reform agenda that we are pursuing.
Time is short, and I am sure that noble Lords would like their dinner before everything closes. I think that one has to stress the obstacles, such as travel requirements, yet again. The noble Lord, Lord Davies of Stamford, suggested that one could spend more time visiting others. I am sure that the Daily Mail would take very careful note of the sort of hotels in which Members stayed. Again, all of these things require time and effort. If you do one thing, you cannot do another. The noble Lord, Lord Judd, suggested that we need to get ordinary people involved, not always members of the elite. Unfortunately, politicians by definition are part of the elite. We are not ordinary people, otherwise we would now be at home watching television or doing something else. Part of the underlying problem of democracy that we now have is that it is easy to decry those engaged in national, let alone international, politics as part of an elite.
Lord Judd
I am very grateful to the noble Lord for giving way. I find what he says, as ever, very powerful, but I will give a practical illustration. When under the chairmanship of the noble Lord, Lord Hannay, we were doing a report on drugs in the European context, the noble Lord was at pains to make sure that we were hearing from people working with drug addicts on the front line. That is what I am talking about. It seemed to me that the remarks I was making were being addressed to us in the committees as distinct from the Government.
Lord Wallace of Saltaire
My Lord, I understand that, and I take that as read. Time is very short. I will therefore turn to government engagement with our Parliament and our committees which the noble Lord, Lord Boswell, mentioned in his opening. He made a number of strong remarks about the Home Office in particular and also about the Cabinet Office, which I will take back and to which we will respond in time.
I disagree with the noble Lord, Lord Davies, that Ministers are delegates, as I think he said at one point. We all understand that we ask our Ministers to engage in a series of complicated negotiations. The importance there is to have a constant dialogue with Parliament and with parliamentary committees as to how far we can go.
This has been an extremely valuable debate. We all understand how vital is the question of restoring a sense of the electorate’s own membership of the European Union, and how difficult that is—as well as how much we hope that what we do in this Chamber and what is done in the other place and other national parliaments can help to rebuild a sense of legitimacy and accountability for the very necessary tasks that we ask the European Union to fulfil.
Lord Boswell of Aynho
My Lords, this has indeed been a full and excellent debate, and I am grateful to noble Lords’ for both their personal generosity to me and for their contributions which, without exception, would repay further reflection and study. I am also grateful to the Minister for his response, which was characteristically thoughtful. I was encouraged by two points. The first was at the end of his remarks, when he in a sense acknowledged that all was not quite well with the Cabinet Office or the Home Office. I might say in parenthesis that that is not always confined to those two departments, and I would be grateful if he would take an active interest in making sure that that practice improves. The second point was that a number of us, either explicitly or implicitly, had expressed concern about the status of national parliaments vis-à-vis the European Parliament. It is very good to get from a Minister on the record in this place that they both have a democratic legitimacy and a role to play. That is a very good start.
I do not want to speak at length but just to pick out brief points from the discussion. In how I cast my remarks, I was anxious that we should open our eyes to the situation in Europe. By “we” I mean not only ourselves as a national parliament chamber here but the European institutions as well. It is incumbent on us all to avoid being baffled or bamboozled by technical complexity. That is inevitable in an institution of 28 member states dealing with some complex and often outward-looking technical issues. However, we need to look at the real situation that is going on. In terms of the references that have been made to relevance to the real world, I would report to the House that the most interesting conversation that I have had in the past year was with a young lawyer in Athens representing the Green Syriza opposition, who was entirely balanced in comment but whose eloquence and sense of anger and resentment was powerful—and you take that kind of thing home.
That leads me to my second point, which is the business of co-operation between national parliaments. Almost all of us who are elected—although we are not in this Chamber—or who in any case have a sense of democratic or legislative responsibility, should naturally want to work together. That could be in a whole variety of flexible configurations, sometimes between the usual suspects—the larger countries—and sometimes in geographic, regional groupings, interest rate groupings, maritime states and states large and small. There are plenty of configurations in which that can be done. It does not require treaty change to bring it about; it is a matter of just learning the habit of co-operation, as we say in our report.
My final point is that we need to change gear in relation to the European debate. Whether people come to this from a Eurosceptic viewpoint or from a more positive viewpoint, as I think that most of us do in this House, it must be in everybody’s interests to have a serious debate. Some of the concerns, and some of the reasons why I have been critical of the Government, have been that I fear some of the motivation in these debates has been driven by an element of fear or even cynicism, hoping that some of the problems would go away, rather than a readiness to move, as we will have to in the forthcoming and unfolding political context, into constructive and positive engagement with the issues. That must surely be in the interests of all of us and the citizens who we claim and have a duty to represent.
The hour is late and I will not test your Lordships’ patience longer by prolonging my remarks. This is a very serious issue, on which we need to move from words to action. In that spirit, I beg to move.