Local Government Finance Bill

Lord Beecham Excerpts

Monday 22nd October 2012 Lords Chamber

[Lord Lloyd of Berwick]

My Lords, I strongly support the thinking which lies behind the amendment, for all the reasons so eloquently given by the noble Baroness, Lady Meacher, and for all the reasons which she gave late at night last week at the very end of the Report stage. I regret that I was unable to be present on that occasion.

My only concern now is that the single word that she has chosen to bring about her purpose may not be the very best one. There may, after all, be all sorts of reasons for a person failing to comply with a requirement, good as well as bad, and there may be good reasons even when a person knows that he is failing to comply with the requirement. What is needed is a word which distinguishes between the good and the bad reasons. The ordinary words which are always used to do that, which I think is the objective that the noble Baroness has in mind, would not be “knowingly” failing but failing “without reasonable excuse”. It so happens that those are the very words which are used in paragraph 1(2)(b) of Schedule 3 to the 1992 Act, which is the Act that we are amending and which there imposes a civil penalty of £50. Those words, “without reasonable excuse”, which we already find in the Act, are all the more relevant and important now that we are turning the civil remedies into criminal offences.

I am of course aware that this is Third Reading and that a manuscript amendment is not permitted, but if the Minister is attracted by the thinking behind the amendment, as I certainly hope that she and other Members of the House are, perhaps she will bear these words in mind when she gives the matter further thought.

[Lord Beecham]

My Lords, I join the noble and learned Lord, Lord Lloyd, in endorsing the thrust of the amendment moved by the noble Baroness, Lady Meacher, and I respectfully adopt his formulation, which I think meets the drafting point. In any event, I have an inherent aversion to the creation of absolute offences, which is what new Section 14B does. It is not appropriate to criminalise behaviour which could be dealt with in the way of a civil liability, particularly when there is not a necessary element of dishonesty. I hope that, when the legislation goes back to the House of Commons, the Minister will look sympathetically with her colleagues in government at whether the provision could be improved.

However, in addition to the matters which the noble Baroness’s amendments address, I am concerned about some further provisions in the proposed new section. New Section 14B(4) states that regulations under subsections which refer to false statements and the like—that is, subsection (1)(d), (e) and (f),

“that create an offence that may only be committed by a person acting dishonestly … must provide for the offence to be triable summarily or on indictment”.

I have no objection to that, but new subsection (6) states that regulations under those provisions which,

“create an offence that may be committed by a person acting otherwise than dishonestly”,

would incur a lesser sentence. So there is still a provision within the new provision to allow for somebody not acting dishonestly to be brought before the criminal courts under the provisions of new subsection (1)(d), (e) and(f). That is another example of stretching the creation of an absolute offence.

It is clear that people who deliberately fail should be dealt with but, in my view, not necessarily by the criminal courts. It is equally clear that those who may fail inadvertently or for the reasons advanced by the noble Baroness should not be treated as criminals, although there may be and perhaps should still be a procedure for them to suffer some penalty as an inducement to provide information. That point may be more debatable. I join with the noble Baroness and the noble Lord in thinking that those provisions go too far to criminalise behaviour—particularly, as the noble Baroness said, as that may well affect vulnerable people, for whom a criminal sanction is simply inappropriate.

Without the Minister committing herself today, I hope that she will at least agree to discuss this further with colleagues to see whether a less draconian process could be used.

[Lord Mackay of Clashfern]

My Lords, I assume that the prosecuting authority would have some regard to the circumstances of any suggested offence under the regulations, but it is very important that the regulations should not include people as potentially liable for criminal sanctions who have not been dishonest in some way or other. The noble Baroness has given examples of people who might find it very difficult to comply with regulations within 21 days in some circumstances. I hope that my noble friend, with her colleagues, may find it possible to modify the statutory language to eliminate the risk of people being faced with criminal charges who are not deliberately doing wrong but who find themselves in difficulties of one kind or another.

I have sympathy with the view that the regulations which deal with council tax are extremely complicated and that it would be easy for someone to fall into a mistake without any deliberation. The last thing that we would want is to criminalise people who make honest mistakes; otherwise, most of us would have some difficulty avoiding the criminal law at some stage, and possibly at more than one stage, of our careers.

--- Later in debate ---

Moved by

[Lord Beecham]

15: Schedule 4, page 65, line 29, at end insert—
“( ) Such regulations must have regard to the possibility of authorities having to hold a further consultation as a result of the necessary alterations that must be made to their schemes in order to make a successful application to the transition grant.”

[Lord Beecham]

My Lords, we have reached—at long last, some of your Lordships might think—the final chapter in debating what this side, at any rate, regards as a fundamentally flawed Bill, particularly with regard to the system of council tax support. The Bill will create significant difficulties for councils in terms of administration, collection and indeed decision-making about who is and is not to be entitled, and it will involve significant hardship for too many of their residents.

The amendment, though, does not address the substance of the Bill; it is more about process, albeit about an important part of it. Under the Bill’s provisions, authorities are required under paragraph 3 of Schedule 4 to consult before making a scheme, publish a scheme in such a manner as they think fit and generally consult anyone with an interest, including major precepting authorities, and then they may publish it. However, sub-paragraph (4) states that the Secretary of State may make regulations about the procedure for preparing a scheme, and it is to that paragraph, effectively, that the amendment seeks to add a rider: that the regulations must have regard to the possibility of authorities having to hold a further consultation as a result of the necessary alterations that must be made to their schemes in order to make a successful application—the amendment says “to the transition grant” but I suppose that it should be “for the transition grant”—which we debated at some length last week.

As we debate the Bill before it leaves us on its return to the House of Commons, councils up and down the country are in the throes of consulting on complex changes to the benefits system affecting millions of people. We have heard in previous debates about schemes that run to well over 100 pages, and no doubt authorities are doing their best to consult their citizens, organisations and indeed the precepting authorities about how the system should be developed. If I may again refer to the experience of my own authority in Newcastle, the city council is faced with a loss of some £3.4 million as a result of the changes to benefits. That in itself, had it been a council tax increase, would have substantially breached the 2% limit that the Secretary of State has fixed from next year because it would in itself constitute a 3% increase in council tax. However, technically speaking, that is not what is happening, although I am bound to say that the rather airy way in which the Secretary of State and indeed the Minister appear to assume that after the transitional year it would be possible to meet that bill, simply by magicking some more savings out of the system, strikes me as a little overoptimistic, particularly when in any event many authorities will be not only generating savings already in the pipeline, as it were, but seeking to meet a substantial reduction in government support over the next few years—in my own authority’s case, some £90 million a year within three years.

Be that as it may, however, the council is seeking to consult on its current scheme, a consultation that has produced a two-page densely printed document setting out the proposals that the council makes. We have already touched on some areas: there is protection for a number of groups, and there is the 20% contribution in general from those who may not even be currently paying council tax. Whether, and to what extent, people will be able to grasp what is happening, particularly if they do not have a well informed knowledge of the current system, is perhaps another matter. Still, the council is providing material online for people to reply to and download, as well as a telephone line and indeed 14 public meetings, between now and the closure of the consultation period on 14 November, bearing in mind that the council has to take through its processes decisions about the scheme and about the budget overall, and there is not a great deal of time to do that.

--- Later in debate ---

[Lord Beecham]

I beg leave to withdraw the amendment.

Amendment 15 withdrawn.