Police Reform and Social Responsibility Bill

Debate between Lord Blair of Boughton and Lord Wasserman

Wednesday 29th June 2011 Lords Chamber

[Lord Wasserman]

I, too, am a great believer in non-executive directors. Having served as a non-executive director on a public company and on several private companies, I think that non-executive directors have an extremely important role to play, but their role is defined as relating to “fiduciary duty”. They are there to look after the interest of the shareholders, or owners, of the company. They understand their role, management understands their role and, where it all works extremely well, as several noble Lords have already said, we know that they appreciate that role.

However, the amendment is not about fiduciary duty but about expertise, advice and management, which are quite different. This is not about the role of a non-executive director, who is an independent director on the board who ensures that the interests of the shareholders are looked after; this is about having a team that will bring expertise, knowledge and advice to the police and crime commissioner. I think that the amendment confuses a non-executive with, as it were, a consultant or a special adviser; they are not quite the same. We ought not to think of this proposal in terms of a board of non-executives who provide independence but in terms of people who provide expertise. The amendment says that these people will advise on financial matters, staff matters and equality matters. It is important that such expertise should be available to PCCs—there is no question about that—but to suggest that these are non-executives who form a non-executive board is, it seems to me, the wrong way to go about it.

Also, we know that it will be open to any PCC to hire advisers and consultants—no doubt some will, and no doubt there will be some who will not who should—so the amendment seems to be rather a sledge-hammer taken to a nut. The amendment would require all 43 or all 41 forces, no matter how small, to have at least four non-executives. I think that the whole thing is far too prescriptive.

And yet the amendment also leaves lots of questions unanswered. For example, how often should the non-executive board meet? If we put this in the Bill, it will be quite open to a PCC never to bring the non-executives together or to bring them together once a year for a meeting lasting half an hour. The PCC would thereby fulfil the terms of the amendment, yet he would not get the advantages of having non-executives. The next thing, we know, is that we will want to set out regulations to make it clear that the PCC has to meet with them and how often he has to meet with them. What papers could the non-executives see? Could they see all papers or only those that relate to their particular subject? Could they see operational papers and all the papers that the PCC sees? Could they be briefed by the chief constable? Could they deal directly with the chief constable and with the management team, or could they only advise the PCC? Finally, how is their effectiveness to be judged? Can the PCC fire them whenever he wants to, or does he have to go back to the panel to fire them? According to this amendment, he does not. It would be a ridiculous situation if he fired them and then hired a new group, the panel approved a new group and then he disagreed with them.

There are several problems, but the main problem is that it is far too prescriptive while leaving these gaps. It smacks too much of central direction. I was thinking of the day when there will be an association of non-executive members of police authorities. They will meet regularly with ACPO at the annual conference and discuss the problems of non-executives. It will be all far too organised. There will certainly be directives out of the Home Office describing in minute detail when they should meet, how often they should meet, what records should be kept and so on.

Even worse than that, I see this as a sort of consultants’ windfall. What will happen, unless we specify that these non-executives have to be resident in the area of the particular force, is that we will have a group of high-powered, well paid, very able and experienced consultants who act as non-executive directors for five, 10 or 20 forces. They will be specialists in equality, finance or staffing. There would be nothing wrong with that; it would achieve what this amendment wants it to achieve—namely, it would bring expertise to the commissioner. It would hold his feet to the fire if he refused to make decisions or, on the other hand, tell him that he has not got all the power in the world. The noble Lord, Lord Harris, suggested that that was one of the functions. I see this very much as a windfall for consultants, and I doubt that we really want that.

While the Bill gives chief constables more freedom to manage, at the same time this amendment gives the PCC less freedom. We are saying on one hand that the chief constable can appoint his top management team and at the same time that the PCC has to have approval for his non-executive team. That seems wrong.

Finally, I think or hope that people see this Bill as strengthening the link between forces and their local communities. This amendment will in effect weaken it by bringing in experts who are not related to the community but are simply there for their expertise, their knowledge and their experience.

[Lord Blair of Boughton]

My Lords, I apologise to the noble Lord, Lord Newton, for adding to his collection of commissioners and chairmen of police authorities. However, I want to say, having served as a chief officer of police for 15 years, that I served with the police committees that the noble Lord, Lord Howard of Lympne, reformed in order to bring in an independent group of people. The committees were transformed by that process. I know from what I have heard of the speeches of my erstwhile colleagues that all of us feel that the independence of some people around this police and crime commissioner is fundamental. I have not seen a better amendment than the one put forward by the noble Lords, Lord Harris and Lord Stevens, and I support it.