Public Bodies Bill [HL]

Baroness Meacher Excerpts

Monday 28th February 2011 Lords Chamber

[Baroness Henig]

My Lords, I declare an interest as the current chair of the Security Industry Authority and president of the Association of Police Authorities. In the speech I made at Second Reading I told the House about the enormous concern with which the Government’s proposal to abolish the organisation and return to self-regulation of the industry was greeted, particularly by people in the industry and also by Scotland and Northern Ireland. Last week the chairman of Security Alliance said how the inclusion of the SIA on the list for abolition came as a great surprise to the industry. He said that since regulation was introduced, there had been a general acceptance in the industry that licensing had been a force for good. So that is clearly understood and agreed across the industry.

We know there has been a lot of criticism recently in the other place by the Public Administration Committee about the handling of the bonfire of the quangos. The committee said it was a rushed, botched job with no clear evidence of savings or concern for value for money or efficiency. More important for the SIA was the lack of consistency in applying the three questions and the issue of whether they were even the right questions to ask. I asked at Second Reading why the SIA was being abolished when the Gangmasters Licensing Authority was being spared—a question which has not yet been satisfactorily answered. The Public Administration Committee’s report asked exactly the same question. The silence in response is deafening.

I asked another question to which there has been no response: why is it that the Government believe the industry is mature enough at this moment in time to regulate itself when the Scottish Government, the Northern Ireland Administration and even large parts of the industry disagree very strongly. Yet the Minister told us at Second Reading that there had been no major disagreements on the legislation between the Government and the Scottish Government. I do not think that is entirely an accurate description but obviously I defer to others on that.

The most serious issue I had with the Government on this matter was their lack of consultation with the industry. After all it was the BSIA and other bodies and individuals within the private security industry which consistently pressed for regulation of the industry in the 1980s and 1990s and they have supported it and for the most part paid for it. Surely, therefore, the views of the industry should have been sought before the policies were drawn up, not to mention the uncertainty caused to 350,000 individuals working in the industry_, many of whom funded their own licence fee and invested in their training. Surely there should have been consultation with all these people. Certainly the view of the Public Administration Committee was that there should be consultation with all the bodies listed in this Bill, even at this late hour, and who can say that it is wrong?

In the case of the security industry, its leaders sensibly were not prepared to wait that long. Indeed, they made their opposition to the ending of regulation and the abolition of the SIA very clear. They wrote to the Home Secretary, the Prime Minister and the Deputy Prime Minister. They organised and they highlighted the tremendous risks inherent in the Government’s proposals, forcing the Government to change their mind. Instead of abolition the Government agreed that there should be a phased transition to a new regulatory regime and that the SIA should no longer be an NDPB.

So there has been a change and therefore this Bill is already out of date in terms of regulation of the private security industry. In the exchange of views that took place between the Government and the industry, industry leaders made it clear that they were already discussing with the Security Industry Authority a blueprint for the evolution of regulation whereby the regulator and the industry would work together to produce smarter, more cost-effective regulation and would press the Government to introduce business registration alongside individual licensing so that we could move to a more efficient, effective and lighter-touch regulatory regime—“better for less”, to use the Government’s own phrase. That was certainly what the industry was working towards with the SIA. As the Public Administration Committee so rightly observed, the major issue at stake in relation to quangos should not be about their status or structure but about effectiveness and delivering value for money. Since last summer the SIA has been in discussion with the industry about precisely these matters.

The issue before us in this discussion on the Security Industry Authority is not a simple should it or should it not be abolished, but how best to facilitate a phased transition from the current regulatory regime to lighter touch, smarter regulation in which industry bodies and leaders play an increasingly active and important role alongside the SIA. There is no disagreement about that. The issue is that it is a process which will take time. It cannot be rushed. It has to include all sections of the industry that are currently regulated. While the recent emergence of the Security Alliance as a unified voice for the industry is to be welcomed as a very positive development, it is by no means fully established across the industry. So there is a lot of work to be done, and along the way the decisions made by the Home Office and the Government in relation to the extent of regulation—for example, that it should not include in-house security, or for the time being private investigators or security consultants—will undoubtedly be queried and challenged by many in the industry. If we are discussing the industry’s future, people working in it want to raise many things.

Then there are the views of Scotland and Northern Ireland. I cannot speak with enormous knowledge about these areas but the licensing of private security has been a huge success both in Scotland and Northern Ireland. It has been in Scotland since 2007 but licensing in Northern Ireland is just a year old. The Northern Ireland Administration are in no rush to change it and we can understand why. They think that it has made a big difference. Both those areas have elections in the spring and we will have to wait to find out the views of the new Administrations and Governments that result. A lot is standing in the way of progress at the moment. As part of the phased transition process, the industry is strongly of the view that the Government should play their part by showing a willingness to bring in business registration in the industry, alongside the licensing of individuals. I hope that the Minister will be able to commit the Government to action in relation to business registration when she replies, as the industry is keen to see that.

We are working to move forward. We in the SIA are consulting a whole range of bodies, including the strategic consultation group, a Security Alliance industry panel, and so on, because it is important to have agreement with the industry and major stakeholders on key principles and milestones for the future, while being conscious, as was said, of the need to proceed cautiously before the Olympics in 2012. There are also the Commonwealth Games in Scotland in 2014 and we must not forget that. It is important to put on the record that many senior figures in the industry are urging caution. They do not believe that the industry is yet ready for self-regulation. I strongly support giving the industry more responsibility in terms of licensing and training, but I share its view that there is no evidence at present that it is sufficiently mature at this point for self-regulation. We have to move very gradually towards that goal. Substantial progress will have been made towards establishing a new regulatory regime by 2014 but there is the big issue of effective intelligence and enforcement operations. It is important that they continue and that the state continues to maintain a strong regulatory regime in respect of criminality; in respect of criminals and their associates; and in respect of those who continue to seek to undermine and weaken the regime. Everyone who works in the industry wants the regime to be effective in driving out and keeping out criminality and in upholding robust standards. That is extremely important because the credibility of the industry requires strong intelligence and enforcement activity, which has to continue in any new regime.

There is a considerable way to travel. Listing the SIA in Schedule 1 to the Bill was a misguided and inappropriate step for the Government to take. We are talking about Schedule 3 and changing the nature of the organisation and moving it to something different. The important thing is that we all want to build on and improve the regulation that has been introduced. It has been a great success and we want to continue it both with the industry and the devolved Administrations. We have to work with them at their pace, which I hope the Government will be supporting so that we can move forward together.

[Baroness Meacher]

My Lords, I will speak very briefly in support of the comments of the noble Baroness, Lady Henig, the current chairman of the SIA. I should mention that I was the first chairman of the Security Industry Authority some years ago and in that capacity I came to respect very highly the considerable number of companies that control the vast majority of companies within the security industry. However, I was introduced to the industry prior to regulation and can certainly endorse the comments already made that the industry does attract a large number of highly unscrupulous individuals who, without very tight controls, are more than willing to take advantage of the unsuspecting, either employers or members of the public.

The two big achievements of the SIA, and a credit to its current chairman, have been the raising of the educational level of the 350,000 or so security officers and also, as others have mentioned, the protection of the public and employers from these unscrupulous security guards. I am sure the Minister would like to recognise the value of its work.

There is of course merit in the proposal to focus in future on the system of business registration, leaving the individual licensing largely in the hands of the industry. However, I too do not accept the Government’s argument that none of the SIA functions needs to be carried out by a public body. In view of the extent of criminality within the industry, and the potential for far greater amounts of criminality, this just does not seem realistic. It is difficult to imagine that all aspects of the SIA can effectively be carried out by the industry itself.

The Government refer to employers in other industries taking responsibility for making appropriate recruitment decisions and suggest that this approach would be appropriate for the private security industry. My understanding is that the industry just is not ready. I do not think the Government have at all taken into account the degree of criminality in the industry. It must be quite alone—in fact I cannot think of any other industry that has comparable problems.

It is certainly most encouraging that Ministers have now agreed to the SIA’s plan for evolution towards a new system based upon business registration. However, Ministers do not seem to be taking account at all of the degree of opposition to these changes both in Scotland and Northern Ireland. It seems the Government will need to move much more slowly if they are to have any hope at all of bringing the devolved Administrations with them. I hope the Minister will take very seriously the points already made by the noble Baroness, Lady Henig.

I want to mention one small but particularly threatening sector of the security industry—the security officers who control parking on private land. The Government are committed to ending the right to clamp vehicles on private land. I applaud this move wholeheartedly. However, there is no move to prevent, as I understand it, these operators charging unsuspecting members of the public extortionate fees for parking on private land. It is in this area that threats are made and extortionate quantities of money are demanded, increasing over time if people do not pay up quickly, that lead to people submitting to the fees charged. I hope the Government will be able to deal with that relatively small but really alarming sector of the security industry in the course of their deliberations about reform.

I was very pleased to note in the Government’s briefing that any proposed changes will be subject to parliamentary approval. Perhaps I may take this opportunity to applaud the Minister, who told us in a meeting recently that he will be eliminating Clause 11 and Schedule 7 from the Bill. This does seem to me an enormous step forward and I imagine I am speaking on behalf of others too in saying that this is extremely welcome. That is at least an excellent piece of good news.

Finally, as others have said, the SIA regulatory system is self funding. There are no public spending implications in this reform. Perhaps the noble Baroness will explain to the House the motivation for a reform which seems to be opposed not only by the devolved Administrations but also by the industry which currently pays the bill for the Security Industry Authority. I look forward to the Minister’s response.

--- Later in debate ---

[Baroness Meacher]

The Minister has repeatedly referred to the industry as though it was some uniform set of organisations. Does she accept that there is a tremendous divide between the reputable end of the industry and these highly dubious individuals and pairs of people who go about taking work in the security industry? You cannot refer to them in the same breath—and certainly not in the same phrase. Does she accept that?

[Baroness Neville-Jones]

I accept that this industry—I do not know what other term I can use: perhaps “this occupation”—has a wide spectrum of activities and individuals in it. I will come to that in a moment. I want to encourage your Lordships to have more confidence that those in this industry can be relied on and are willing to take further responsibility and be more accountable for their own actions in future. I understand that there is some concern that if the SIA is abolished there will be no effective regulation of the private security industry. I want to offer reassurance on that point. We are not going to do anything immediate. We have been convinced by those who have argued that that would be unwise and that it would not be sensible to do that. The regulation of the private security industry will continue in its present form. The SIA will not be abolished until the new regulatory regime has been fully established and is properly functioning.

Since the outcome of the public bodies review was announced by the Cabinet Office on 14 October, Home Office Ministers and officials have been in close contact with the SIA to discuss how to take this forward. The Parliamentary Under-Secretary of State for Equalities and Criminal Information, who is the lead Home Office Minister for the SIA, has met the SIA representatives. The Home Secretary herself has been in correspondence with the noble Baroness, Lady Henig, about the future.

Ministers have asked the SIA to work with the private security industry and key stakeholders to put together a detailed plan to achieve a phased transition to a new regulatory regime. We do not intend to do this in anything but careful detail. To inform the plan, the SIA started targeted consultations with stakeholders, including industry and law enforcement partners. The police were mentioned, and they are involved in the consultation process. A detail of the phased introduction of the new regulatory regime that will replace regulation by the SIA will be the product. The SIA started this work by hosting an initial meeting with a number of industry stakeholders on 28 October. I understand that this work is progressing well.

In the Second Reading debate on this Bill on 9 November, the noble Baroness, Lady Henig, stated that the SIA had already agreed with the industry,

“a blueprint for the next few years to move to greater industry involvement in the regulatory regime”.—[Official Report, 9/11/10; col. 133]

She also quoted from a letter that she had had from the Home Secretary in which she very kindly said that she was happy to accede to the Home Secretary’s wish to ensure that,

“any transition to a new regulatory regime is phased in smoothly and takes into account the needs of the industry as well as the priorities of the Government including the devolved Administrations”.

To confirm the point made by the noble Baroness, Lady Royall, the Home Secretary has agreed that there should be no significant change prior to the Olympic Games in 2012. That is in line with a number of measures in other areas in which we are staying any kind of change until after the Olympic Games.

My point in all this is that the SIA itself is involved in the work to move towards something that is described as self-regulation by the private security industry but which is a pretty tough form of self-regulation. I will come back to some of the details in a moment. The SIA plan was presented to Home Office Ministers earlier this month for consideration, and on 16 February there was another meeting with Lynne Featherstone to discuss the plan further. We have now considered and agreed that this will form the basis for moving forward on phased transition. I hope I am reassuring the Committee that this process is being done in careful consultation with the SIA and the industry on the basis of trying to ensure, therefore, that we come out with a regime that offers the same degree of assurance of high standards that has already been established.

As a result of the consultation, we are now in a position to give a few more details of the shape of the new regulatory regime, although the Committee will understand that as we are still in discussion—the whole point of the discussions is to get an agreed format between the parties—not all the details have been decided. So far, the agreed proposals will ensure that responsibility for the private security industry is transferred to a new body for self-regulation as soon as that is sensible after 2012—not before it is sensible and not before the Olympics in 2012. No significant change will happen before that.

Primary legislation will then be needed to set up the new regulatory body that will succeed the SIA. We will ensure that provision is included in a future Home Office Bill. Full transition to the new regime should, we hope, be completed by the end of 2013. Again, this is not a rushed process.