United Kingdom Internal Market Bill

Baroness Jones of Moulsecoomb Excerpts

Committee stage & Committee: 4th sitting (Hansard) & Committee: 4th sitting (Hansard): House of Lords
Wednesday 4th November 2020 Lords Chamber

[Baroness Bowles of Berkhamsted (LD) [V]]

My Lords, I have two amendments in this group. I also support the amendment just explained by the noble Baroness, Lady McIntosh.

This group concerns the information-gathering powers in Clause 38; it applies to Clause 31, under which requests for a report from the CMA may be made by anyone, and to Clauses 32, 33 and 34, under which administrations may request, respectively, advice on proposed regulatory provisions, reporting on the impact of a regulatory provision and reporting on a regulatory provision that is or may be detrimental to the market.

To prepare reports, information needs to be gathered. The powers enable the CMA to ask any person for any document in their possession or to require any person who carries on a business to provide estimates, forecasts, returns or other information as may be specified. As the noble Baroness, Lady McIntosh, has already highlighted, it can further specify the time and place at which, and the form and manner in which, the information is to be provided. It may also require conversion of a non-legible record into a legible and intelligible copy of information. There is no acknowledgment of how onerous this may be other than in subsection (8)(b), which says that travel expenses must be offered if a person has to go more than 10 miles from their place of residence. This could impose significant burdens on individuals or small businesses, to whom time is money.

It does not indicate that the information sought is only that which is readily available; it seems there is nothing to stop it requiring the preparation of estimates rather than, say, just the forwarding of those that might have been given to customers in the course of business. Many businesses may well be happy to assist in what is tantamount to a survey about the effects of regulation, just as many respond to consultations, but for small businesses it could be a burden. For sole traders it may mean a significant loss if income is dependent on work, whether that is as a plumber, lawyer, childminder, shopkeeper or anything else.

I am aware that the template of CMA market study investigations and Section 174 of the Enterprise Act have been followed, but are we truly looking at comparable circumstances? Market studies have more statutory requirements and guidance around them, such as the requirement of a market study notice and all the defined stages and practices. That does not seem to have been transposed into this. Nor are the circumstances those of known market deterioration caused by market participants—for example, it may just be about proposed or enacted regulation, with any flaws caused by administrations, which is completely different from when businesses, collectively or individually, have themselves created oligopolies, monopolies or concentrations.

In Amendment 150, I put forward that there should be provision for loss of earnings—why not, if the circumstance is that the expertise of the business is being sought? An alternative way to collect this kind of information is through consultations or by commissioning research. The CMA is empowered already under Section 5 of the Enterprise Act to commission such reports without resorting to enforced business responses. The members of the panel that will prepare the reports are being paid for their expertise, so why not those others who are being harvested for information?

My Amendment 156, would insert a new clause:

“The CMA must take account of the effects of additional duties imposed on small business in its approach to the exercise of its functions under sections 31 to 34, and its powers under sections 38, 39 and 40.”


This is not a strong amendment, but at least it makes the point, as otherwise there is no guidance. I am sure that MPs would interest themselves in the sorry stories they will be sent if there are burdensome requirements but, absent something like this, they have nothing to point to when overstepping has taken place. I will return to this matter in the context of penalties in the next group, but when there has been no wrongdoing that brings about the request for information—possibly burdensome requests, enforceable through fines rather than encouragement—it seems a wholly disproportionate measure. As I have said, I do not believe the cause is comparable with current CMA market studies.

Whither now the comply or explain principle—I have always been more of a “make them comply” person, as my track record will show, but these measures offend me in principle and seem to come from the department against business. I can see the matter is different if the business is under investigation for their own doings, but there is no distinction made in the clause. Clause 39 has a “without reasonable excuse” provision and I intend to probe that in the next group but, for now, can the Minister clarify the limits to the burden that can be put upon small businesses and the circumstances envisaged? Something of record has to be made.

As a final related point, there are also circumstances, of course, where much more has been opened up for challenges by businesses through Clause 31, giving the CMA reach into both administrative decisions and to other companies. My noble friend Lord Fox will say more on that.

[Baroness Jones of Moulsecoomb (GP) [V]]

My Lords, I will be very brief, as the noble Baronesses, Lady McIntosh and Lady Bowles, have explained this group extremely clearly. As the noble Baroness, Lady Bowles, said, these measures just offend me in principle. The Government seem, time and again, to understand big business, and are happy to give very large amounts of money and all sorts of leeway to such businesses and organisations but, at the same time, quite often miss the point on small businesses, which often struggle to survive—particularly during lockdown.

Small businesses can be the creative heart of our society at times—creating jobs for a lot of local people and, indeed, more widely. Will the Minister listen and understand that such intrusive and burdensome measures really do impact on small businesses that are already struggling to survive? I know it is very difficult for the Minister to commit to anything, but surely he is prepared to discuss this sort of issue with noble Lords and perhaps come to some sort of agreement.

[Baroness Neville-Rolfe (Con)]

My Lords, I was glad to see Amendment 149. It is always good to be clear about legal privilege to avoid needless or inappropriate fishing expeditions by regulatory staff, and it matters for in-house counsel as well as for external lawyers. It would be good to be clear on the Government’s intentions.

I also support the sentiment behind Amendments 150 and 156. We need to look after small business, the economic dynamism of which reflects a UK sector that was the envy of everyone when I was the Competitiveness Minister in Brussels. There is much in this Bill that they might fear: rules of which they are unaware; costs, as the noble Baroness, Lady Bowles, suggested, from burdensome requests; big fines; and quasi borders created between the different nations of the UK. I worked with the Federation of Small Businesses on regulation and getting them paid on time, and I try to promote a positive climate for the scale-up of small businesses, rather than a sale to a Silicon Valley, or other, giant after a short run of success. How will the Bill help small businesses, and are there dangers lurking here?