Sky and 21st Century Fox: Proposed Merger

Lord Keen of Elie Excerpts

Thursday 29th June 2017 Lords Chamber

[The Advocate-General for Scotland (Lord Keen of Elie) (Con)]

My Lords, with the leave of the House I shall repeat a Statement delivered by my right honourable friend the Secretary of State for the Department of Culture, Media and Sport. The Statement is as follows:

“I came to this House on 16 March to confirm that I had issued a European intervention notice in relation to the proposed merger between 21st Century Fox and Sky Plc on the grounds of media plurality and commitment to broadcasting standards. The EIN triggered a requirement for Ofcom to report, initially by 16 May but extended to 20 June, on the media public interest considerations and the Competition and Markets Authority on jurisdiction. I issued a statement last week to confirm that I had received those reports and undertook both to publish them, today, and to come to the House to set out my minded-to decision on the next step in this process: whether to refer the merger to a fuller phase 2 investigation. In line with my commitments, I am today publishing both documents, copies of which will also be deposited in the Libraries of both Houses. I will also be publishing later today the letter to both parties with my decision, which I sent them this morning. Separately, Ofcom is today publishing its fit and proper assessment of the merged company. This reflects its ongoing responsibility as the independent regulator under the Broadcasting Acts to monitor who is fit and proper to hold a broadcast licence.

Decisions made by the Secretary of State on media mergers under the Enterprise Act 2002 are made on a quasi-judicial basis. I want to be very clear about what that means. When taking a quasi-judicial decision, I am tightly bound. I must take my decision only on the basis of the evidence that is relevant to the specified public interests. My decision cannot be based on opinion, speculation or conjecture. Any decision I take must be objectively justified by the facts before me. I must set aside wider political considerations going beyond the scope of the legislation. I must act independently and follow a process that is scrupulously fair and impartial. This is what I am doing.

On the question of whether the merger gives rise to public interest concerns in relation to media plurality, Ofcom’s report is unambiguous. It concludes:

‘The transaction raises public interest concerns as a result of the risk of increased influence by members of the Murdoch Family Trust over the UK news agenda and the political process, with its unique presence on radio, television, in print and online. We consider that these concerns may justify a reference by the Secretary of State to the Competition and Markets Authority’.


On the basis of Ofcom’s assessment, I confirm that I am minded to refer to a phase 2 investigation on the grounds of media plurality. The reasoning and evidence on which Ofcom’s recommendation is based are persuasive. The proposed entity would have the third-largest total reach of any news provider—lower only than the BBC and ITN—and would, uniquely, span news coverage on television, radio, in newspapers and online. Ofcom’s report states that the proposed transaction would give the Murdoch Family Trust material influence over news providers with a significant presence across all key platforms. This potentially raises public interest concerns because, in Ofcom’s view, the transaction may increase members of the Murdoch Family Trust’s ability to influence the overall news agenda and their ability to influence the political process and it may also result in the perception of increased influence. These are clear grounds whereby a referral to a phase 2 investigation is warranted, so that is what I am minded to do. There, is, however, a statutory process that I must follow. I am required by legislation to allow the parties the opportunity to make representations to me on this position before I reach a final decision. I will now do that and have given them until Friday 14 July to respond.

The second question concerns whether, after the merger, the relevant media enterprises would have a genuine commitment to broadcasting standards. Ofcom is unequivocal. It concludes:

‘In light of Fox’s and Sky’s broadcast compliance records and taking account of our separate assessment of whether Sky remains fit and proper to hold broadcast licences following the transaction, we do not consider that the merged entity would lack a genuine commitment to the attainment of broadcasting standards. Therefore, we consider that there are no broadcasting standards concerns that may justify a reference by the Secretary of State to the Competition and Markets Authority’.


Ofcom’s approach sought to measure commitment to broadcasting standards by reference to breaches of regulatory codes. It found that Fox’s compliance with the UK’s Broadcasting Code is in line with comparable broadcasters. Nor did Fox’s compliance record in relation to overseas broadcast jurisdictions—where Ofcom’s analysis focused largely on the European Union—give cause for concern.

I also asked Ofcom to consider the effect of any failure of corporate governance on this public interest consideration. Ofcom did this in the context of its separate assessment of whether Fox and Sky would remain fit and proper to hold broadcast licences following the transaction. It concluded that,

‘the behaviours alleged at Fox News’—

in the United States—

‘amount to significant corporate failure’.

However, these did not, in its view, demonstrate that the merged company would lack a genuine commitment to broadcasting standards.

In reaching a view, I have to be guided only by the evidence before me. As such, based on the Ofcom report, I am currently minded not to refer to a phase 2 investigation in relation to a genuine commitment to broadcasting standards. As required by legislation, I am giving the parties an opportunity to make representations in relation to media plurality grounds, where I am minded to refer for a phase 2 investigation by the CMA. In the interests of transparency and ensuring all the evidence has been considered, I will also invite wider representations on the question of commitment to broadcasting standards, where I am currently minded not to refer for a phase 2 investigation.

Parties responding to the consultation should not simply duplicate any representations previously made to Ofcom. Instead, responses should be limited to setting out any new and substantial evidence and any comment on the appropriateness of Ofcom’s overall approach.

While there are strong feelings among both supporters and opponents of this merger, in this quasi-judicial process my decisions can be influenced only by facts, not opinions, and by the quality of evidence, not who shouts the loudest. The invitation to make representations will open today and close on Friday 14 July and can be found on the DCMS website.

Under the process set out in the Enterprise Act, it is open to the parties to propose undertakings in lieu of a reference to the CMA for a more detailed investigation. In other words, the parties may seek to avoid a phase 2 reference by proposing remedies to address the public interest concerns that have provisionally been identified.

The decision as to whether or not to accept undertakings in lieu is for the Secretary of State alone. However, and somewhat unusually, the parties proposed a set of undertakings to Ofcom, and Ofcom commented on them in its report. The proposed undertakings centred around Fox maintaining the editorial independence of Sky News by establishing a separate editorial board, with a majority of independent members, to oversee the appointment of the head of Sky News and any changes to Sky News editorial guidelines. They also include a commitment to maintain Sky branded news for five years with spending at least at similar levels to now. Ofcom’s view was that these remedies would mitigate the serious media plurality public interest concerns. It also suggested that the remedies could be further strengthened.

The parties last week, without prejudice to my decision today, of which they only learned this morning, formally submitted undertakings in largely the same terms to me. In accordance with the legislation, if I still intend to refer the merger after having considered representations from the parties, I am required to consider whether or not these remedies are appropriate. Given the parties have offered these undertakings and Ofcom has commented on them, I have taken an initial view. I can confirm that I have today written to the parties indicating that I am minded not to accept the undertakings that have been offered. While Ofcom suggests that they mitigate its concerns, it is for the Secretary of State to decide whether they sufficiently mitigate, or ideally fully remedy, what are serious public interest considerations.

I note that Ofcom’s report says,

‘we recognise that behavioural undertakings can be difficult to monitor and enforce and that there are areas in which the proposed undertakings could be strengthened’.

It cites questions regarding,

‘the ongoing arrangements for the appointment of the independent members of the Sky News Editorial Board and the period of Fox’s commitment to maintaining its investment in Sky News’.

I also note the guidance of the Competition and Markets Authority which, in the context of competition cases, says that UILs are appropriate where the remedies are,

‘clear cut … effective and capable of ready implementation’,

and that, in ordinary cases, it is,

‘highly unlikely to accept behavioural remedies at phase 1’.

I have given the parties 10 working days, until Friday 14 July, to make representations on the minded-to decisions I have reached. If I receive further offers of undertakings as part of those representations, I will keep the House informed on how I intend to structure the statutory process I must follow when considering them.

As I have set out, I will now be taking representations on my minded-to positions. The call will remain open for 10 working days and I will then consider the evidence received before coming to a final decision on both grounds. To be clear, the minded-to decisions I have outlined today are not my final decisions.

A word before I close on Ofcom’s fit and proper assessment. As the independent regulator, this is a matter for Ofcom, and my understanding is it will publish its report today. I have seen the report and know many Members in this House will want to comment on it. Given my current quasi-judicial role in the merger, I will not be commenting on the findings.

It is rightly not for the Government to determine who should, and should not, hold TV broadcasting licences. Ofcom has an ongoing duty to ensure all UK broadcasters are fit and proper to hold TV broadcasting licences. I am clear that if any evidence comes to light, it is for Ofcom to take account of that evidence.

I trust, as before, that this update is helpful to honourable and right honourable Members and that this Statement gives an opportunity to debate this important issue while at the same time respecting the limits of what I can say given my ongoing quasi-judicial role in relation to this merger”.

I commend this Statement to the House.

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[Noble Lords]

Order!

[Lord Keen of Elie]

I am obliged to my noble friend for his patience. I start with the points raised by the noble Lord, Lord Collins. So far as the undertakings in lieu are concerned, at present the Secretary of State’s intention is not to accept those undertakings that have been submitted and to give full consideration to whether ultimately such undertakings in lieu will be sufficient. However, at present, as I indicated, she is not minded to accept the undertakings that have already been submitted. Of course, it is always open to a party to put forward further undertakings in lieu, and such undertakings will be considered on their merits in accordance with the Secretary of State’s duty in this context.

The fit and proper party test for the purposes of broadcasting is a matter for Ofcom and not for the Secretary of State. Clearly, it is not appropriate for the question of fitness or propriety to be decided by a Minister in this context, and therefore I would not seek to comment further on that. At the end of the day, it must be a matter for Ofcom. That is why we have an independent regulator in this context.

As the noble Lord is aware, we have indicated that, given the changed landscape over the past six years, we do not consider that we should proceed with Leveson 2, but a final decision on that, pursuant to the Inquiries Act 2005, will be taken following consultation with the chair of the inquiry.

On the misuse of data, I respectfully suggest that the answer lies in the question. We have data protection legislation and, in the event that there is any breach of that, there are remedies within that legislation. Therefore, we consider that the present legislation is sufficient to protect the relevant data of the persons referred to.

The noble Lord, Lord McNally, also touched on Leveson but he referred more particularly to the deadline of 14 July for representations. I make it clear that the Secretary of State has been thoroughly transparent throughout this process and—I hope noble Lords will accept this—has kept both Houses fully informed of how she is carrying out this process in a quasi-judicial capacity. She will take any decision that she can promptly, and she will of course continue to keep the House advised of that decision-making process at the earliest opportunity. However, in response to the noble Lord’s question, I can say that any decisions will be taken only when Parliament is in session.

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[Lord Keen of Elie]

My Lords, I am obliged to my noble friend Lord Grade. I heartily endorse his observation that it is so important to keep the politicians out of these issues—that they should not become politicised. I endorse his observations about the independence of Ofcom in the context of this process. At the end of the day, fitness is for an independent regulator to determine. It would be a poor turn of events if we found that that was simply a political or ministerial decision.

[Lord Clement-Jones (LD)]

My Lords, I fully accept the Minister’s point about the independence of Ofcom and, indeed, the point made by the noble Lord, Lord Grade, about not politicising this process. But returning to the point made by my noble friend and the noble Lord, Lord Collins, about Leveson 2, how can a credible “fit and proper” report be drawn up by Ofcom when Leveson 2 has not taken place and two of the absolutely key terms of reference relate to improper conduct within News International and the corporate governance and management failures at News International?

[Lord Keen of Elie]

With respect to my learned friend—the noble Lord; I apologise—

[Lord Clement-Jones]

I am flattered.

[Lord Keen of Elie]

I have sometimes inadvertently made that observation with regard to a solicitor. At the end of the day Ofcom is satisfied that it has been able to reach a decision on that point and it has done so in a number of different contexts and for a number of years without the requirement for Leveson 2. But ultimately that is a matter for Ofcom. If it felt it was not able to arrive at a conclusion without Leveson 2, I have no doubt it would have said so.

[Lord Dykes (CB)]

My Lords, I endorse and repeat the request that Leveson 2 be regarded correctly, as the noble Lord, Lord McNally, said, despite the Minister’s answer just then. I understand the difficulties and respect the problem that he faces.

There is another extraneous point which is not germane and material to this but is none the less a realistic factor in the outside world. The noble Lord, Lord Collins, referred at the end of his remarks to the non-UK taxpaying element of these owners of British media. I declare an interest because I also live in France, mostly, and my friends in Paris politics often say it is extraordinary that the owners of the right-wing media in this country almost without exception do not pay UK personal taxes. Of course, one of the biggest examples is Rupert Murdoch and his family members because of the spread and size of their media empire. I know this is not central to what the Minister has been saying today—I do not wish to be unfair—but I would be grateful if he felt able to make an extramural comment on something that is very disturbing to many members of the British public.

[Lord Keen of Elie]

With respect to the noble Lord, I do not consider that in the present context and for present purposes it is appropriate to go into the corporate structure or the trust structure of the various bodies that ultimately own the organs of media and broadcasting in the United Kingdom. Certainly, I do not feel that at this stage it would be appropriate to address the question of their tax liabilities, whether they arise within the UK or elsewhere.

[Baroness McIntosh of Pickering (Con)]

My Lords, I took an initial interest in Ofcom when, as shadow Minister, I scrutinised the original Bill setting up Ofcom, and I commend its decision and its role in this regard. In its report, Ofcom states that it has identified,

“the risk of increased influence by members of the Murdoch family trust over the UK news agenda and the political process, with its unique presence on radio, television, in print and online”.

I commend the Statement that my noble and learned friend the Minister has repeated to the House. I understand that this is a preliminary decision and does not reflect the Secretary of State’s final decision, but could he elaborate a little on Sky’s increased concentration of power in its online presence were this sale to go ahead? In this digital age, the BBC has a very strong online presence, Sky News has a very strong online presence and newspapers accept that their online presence is going to increase rather than decrease in relation to the printed media. We have already seen one newspaper go online completely. Would my noble and learned friend care to comment on what the Secretary of State’s thinking will be with regard to a potential diminution of competition and an increased concentration of power in the hands of one family, were this sale to go ahead, and the impact that that would have on the online media?

[Lord Keen of Elie]

I am obliged to my noble friend. Clearly, at this stage, the Secretary of State has made only a “minded to” decision and it would not be appropriate for me to anticipate how she will then proceed in light of further representations between now and 14 July. Ofcom recognised the materiality of Sky and Fox’s presence online. Indeed, that is an increasing issue in the context of news media. Of course, an online presence can take a number of forms. It can be aggregation or it can be the establishment of an independent online body of news. Very often, when one is talking about online, one is talking about Facebook or other forms of media that are simply passing on news that is available offline as well. At this stage I cannot elaborate much further, except to notice that Ofcom took account of Sky’s presence online as well as its presence in terrestrial television broadcasting and newsprint.

[Lord Whitty (Lab)]

My Lords, to an extent I think we have to welcome the fact that Ofcom has behaved independently and that the Secretary of State has taken guidance on plurality. But it underlines the fact that if you want a genuinely free press, you have to have a variety of opinion, and to have that, you must have a wide variety of ownership. If this merger goes ahead, it will restrict that variety of ownership. I hope that when the Minister and his colleagues reflect on this decision as the various stages go forward, they will look again at whether the plurality process and the plurality provisions of the various pieces of broadcasting and competition legislation are adequate to provide a range of opinion, not only in broadcasting in its traditional sense but, as the noble Baroness, Lady McIntosh, has just said, particularly in the online presence, where the corporate behaviour of Fox in America has been deeply suspect. I hope the Minister’s department will look at these longer-term issues in the light of the issues that have been thrown up today.

[Lord Keen of Elie]

I am obliged to the noble Lord. As regards the process, let us see how it works its way through in the context of the present proposed merger. As regards plurality in general, clearly that may properly be judged once we see the outcome of the present process.

Queen’s Speech

Lord Keen of Elie Excerpts

Wednesday 28th June 2017 Lords Chamber

[The Advocate-General for Scotland (Lord Keen of Elie) (Con)]

My Lords, it is an honour, even at this hour, to be asked to speak in support of Her Majesty’s gracious Speech. I thank noble Lords for the many valuable contributions made in the debate this evening. Her Majesty the Queen underlined the core principles of the Government’s programme of legislation on, and their approach to, exiting the European Union in the gracious Speech:

“my Government’s priority is to secure the best possible deal as the country leaves the European Union. My Ministers are committed to working with Parliament, the devolved Administrations, business and others to build the widest possible consensus on the country’s future outside the European Union”.

My noble friend Lady Anelay spoke in the opening of this debate on the context and substance of this legislation as the centrepiece of the Government’s extensive legislative programme to support our exit from the EU. These issues have been discussed with clarity, eloquence and in detail not only today but on previous occasions. I will not seek to repeat all the points that have been raised, but I will summarise certain issues. First, the Government have made clear that we must respect the will of the British people expressed in the referendum last year: we will be leaving the European Union.

I have great admiration for the noble Lord, Lord Campbell of Pittenweem, particularly for his candour. He said in terms that a terrible mistake had been made and that we should simply not leave.

[Lord Campbell of Pittenweem]

I think that when the Minister consults Hansard, he will find that that is not what I said. I said that I remain convinced of the idea that the best interests of the United Kingdom are served by membership of the European Union. I did not characterise my position in the terms that he has suggested.

[Lord Keen of Elie]

I am content to consult Hansard on the point and I am not, at this hour, going to enter into a debate on what was noted and what was not noted in the noble Lord’s comments, but he made it perfectly clear that, notwithstanding the results of the referendum, he felt that the interests of the British people lay in remaining in the European Union.

As I say, the Government’s position is perfectly clear: we intend to respect the outcome of the referendum and, indeed, exit negotiations began in Brussels last week. We are of course working to secure a smooth exit from the EU, and one that protects the rights of EU citizens in the United Kingdom and British citizens in other EU countries, recognising our unique relationship with the other countries in the EU. We want to build a new, deep and special partnership between the United Kingdom and the European Union that takes in both economic and security co-operation. It should be underpinned by ambitious agreements on free trade and customs covering goods and services and seeking the greatest possible tariff-free and barrier-free trade. Of course, those negotiations will be complex and at times challenging, but the Government are confident that with hard work and good will on all sides we can reach an outcome that works for the European Union and all parts of this union—the United Kingdom.

We have listened to the EU and its leaders and we understand and respect the position that the four freedoms of the single market are indivisible and that there can be no cherry picking. Those four freedoms include the free movement of people. The noble Lord, Lord Adonis, referred to these four fundamental and indivisible freedoms as a false doctrine, but they are nothing of the sort. It is a statement of fact that the EU wishes to maintain, and will maintain, the indivisibility of those four freedoms in respect of capital, services, goods and people, and we have to respect that going forward.

The question before us now is how the Government’s plans, including the legislative programme outlined in Her Majesty’s gracious Speech, support the negotiations, ensure a smooth exit from the EU and prepare for the UK’s future outside the EU. The legislative agenda to prepare the UK for its new place in the world outside the European Union is extensive, but it is also necessary. The centrepiece of this legislative programme is the repeal Bill, which has three main effects. First, it ends the authority of EU law in the United Kingdom, transferring power back from Brussels to the United Kingdom. Secondly, it converts the body of EU law into domestic law to maximise certainty for individuals, businesses and consumers by converting EU law into domestic law. It will give Ministers, both here and in the devolved Administrations, the power to amend EU law as appropriate so that we have a functioning statute book on day one after exit. Thirdly, as well as maximising certainty and ensuring a smooth exit from the EU, the Bill will also support a future trade deal with the EU by ensuring that we start from a regulatory level playing field. The purpose of the legislation is clear and significant for the whole country: it is to ensure we have can have a smooth and orderly exit from the European Union.

I will not attempt to address each of the 64 contributions that have been made this evening. That would strain not only my recollection but noble Lords’ patience. However, with the leave of the House, I shall address a number of the contributions and bring together some of the common points that were raised. I begin with the observations of the noble Baroness, Lady Hayter, who spoke of the United Kingdom’s place in the world after Brexit, as if there was going to be a fundamental loss of both hard and soft power. With respect, we do not accept that proposition at all. I remind the noble Baroness that, among other things, the United Kingdom remains one of the few countries in NATO that meets its commitment to spend 2% of GDP on defence, it meets the United Nations standards with regard to overseas aid at 0.7% of GDP, and our standing in the world is measured by these rather than simply by membership of the Union itself.

The noble Baroness spoke of mutuality. That arises in a number of contexts. It is important to appreciate that what we are addressing here is a matter of mutual interest. Just as we have an interest in the enforcement for example of family law decisions within the European Union, so it has a mutual interest in the enforcement of its orders within the United Kingdom. Just as we have an interest in trading with the European Union, so it has a £300 billion interest in trading with the United Kingdom, whether within or without the single market, so mutuality lies at the heart of the negotiation that will be undertaken.

The noble Baroness spoke of the issue of mutual recognition in the context of things such as the European Medicines Agency. But, of course, we address the matter of mutual recognition with regard to such things as medicines and chemicals at an international level. So, for example, we have no difficulty with regard to our dealings with the US federal agencies; there is always an element of good will and recognition arising there.

The noble Baroness also touched on the matter of immigration. We will not be closed to immigration—we will be able to control it. That lies at the heart of the decision that the British people made in the referendum.

The noble Baroness also raised, as did other noble Lords, the question of the devolved Administrations and the matter of devolved competence. Of course, the Government will respect, as they always have, the Sewel convention. In addition, we will engage with all the devolved Administrations in the matter of the negotiation and the outcome of the negotiations with the European Union. Furthermore, so far as Ireland is concerned, we are of course alive to the issue of the hard border, which was alluded to by the noble Baroness, Lady O’Loan, and we are of course determined and have raised already in the negotiation the question of how we can deal with the need for a soft and essentially open border between the north and the south of that island.

On a related issue, my noble friend Lady Hooper raised the question of the overseas territories and of Gibraltar. Again, we have made it perfectly clear that we will represent the interests of the overseas territories and of Gibraltar in the forthcoming negotiations. Indeed, we will never enter into arrangements under which the people of Gibraltar would pass under the sovereignty of another state against their wishes, nor enter into any process of sovereignty negotiations with which Gibraltar itself is not content. We have been absolutely clear: our exit negotiations cover Gibraltar as we leave the EU, and our focus is to get the best possible deal for the United Kingdom, for the overseas territories and for Gibraltar.

I turn to some observations of the noble Lord, Lord Wallace of Saltaire, and of some of his colleagues on the Liberal Democrat Benches. He suggested that the United Kingdom Government are somehow asserting that they hold all the cards in this negotiation. That is not the position that we adopt. Indeed, if we held all the cards, there would not be a negotiation; it would be a matter of dictating terms. There has to be an open and mutually beneficial negotiation to achieve the outcome we all seek. He also suggested that we were somehow simply turning our face away from the European Union and towards countries such as New Zealand, India, China and others. Of course, we seek to embrace the opportunities that will arise with regard to trade in these other parts of the world, but we are not closing off trade with the European Union in any sense whatever. We are not turning our back on our partners in Europe; we will continue to engage with them to our mutual interest and mutual benefit.

The noble Lord went on, in a number of ways, to criticise the approach that the Government are taking, as if somehow we were moving towards an absolute Brexit that took no account of the views of the people of this country. I remind him of the point made by his noble friend, the noble Baroness, Lady Smith of Newnham, who suggested that when the Government respond to the matter of the EU negotiations, they should respond with humility to the people. I respectfully suggest that the Liberal Democrats might also respond with some humility to the view of the people, both as reflected in the referendum and in the recent election, where they went to the people with a particular view of Brexit that clearly was not palatable. So a degree of humility all round might be beneficial to the entire process.

[Noble Lords]

Oh!

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[Lord Keen of Elie]

I turn, with a degree of humility, to the EEA and the observations of the noble and learned Lord, Lord Brown of Eaton-under-Heywood. I agree with his observations regarding the position of the Labour Opposition Bench and about their amendment being somewhat opportunistic in its form. I also concur with his observation that there must be circumstances in which no deal is simply not the worst outcome. Indeed, that was echoed by other noble Lords.

However, I come on more particularly to the question of EEA membership, which the noble and learned Lord addressed. He began by saying that there were a number of points that he would like to make in support of EEA membership. He observed, among other things, that free movement would be less absolute as it does not involve EU citizens. I shall not take issue with what he meant or did not mean by the term “less absolute”, but I observe that, although Norwegians are not EU citizens, those immigrants going from the EU into Norway are EU citizens, and their rights and obligations have to be determined accordingly.

The noble and learned Lord also suggested that, if we were to enter the EEA, our contribution to the EU budget would be smaller. With respect, that is a moot point given the loss of the rebate that would occur in those circumstances. He went on to suggest—this mirrors an approach taken by the noble Lord, Lord Adonis—that within the EEA there would be a retention of sovereignty because EU legislation has no direct effect in an EEA country that is a member of EFTA. However, with great respect, these EEA countries are effectively bound to implement EU legislation if they wish to retain their rights in the single market pursuant to membership of the EEA; it is simply an indirect route to the same outcome.

The noble and learned Lord also suggested—others have mentioned this—that we would not be subject to the jurisdiction of the European Court of Justice, as though this was some major red line in the present context. Of course, although there is an EFTA Court, it has as a matter of fact invariably rubber-stamped all decisions of the ECJ in so far as they are relevant to the EEA and EFTA, and therefore it is really a distinction without a difference. The EFTA Court is little more than a fig leaf. Indeed, for us to leave the EU and join the EEA by way of EFTA would do little more than someone leaving the bridge of a ship and going down to the engine room to shovel coal into the boilers, and we would be paying for the coal as well. We would lose any sense of direction or control but we would continue to contribute to the matter overall.

Just pausing for a moment on the amendment proposed by the noble Lord, Lord Adonis, I reiterate that, although he refers to the four freedoms within the requirements of the single market as a false doctrine, they are nothing of the sort. One has to understand the position of the EU. As far as it is concerned, the four freedoms are not a doctrine, false or otherwise; they are a fact of life, and so far as the EU is concerned they will remain a fact of life. Therefore, to enter the single market and the customs union as proposed is simply to remain by other means within the EU itself, with all that goes with it. That was not the decision of the British people as a consequence of the referendum.

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[Noble Lords]

Order!

[Lord Keen of Elie]

I am sorry, my Lords, but given the hour I am not going to give way.

The noble Lord, Lord Mandelson, also touched upon the question of maintaining membership of the single market and the customs union. He suggested that, even if we were to seek some agreement with the EU with regard to access to the single market, we would, as a matter of fact, have to be subject to the jurisdiction of the European Court of Justice. I take issue with that.

The European Union has entered into more than 40 trade agreements with non-EU countries. Those countries are not thereby made subject to the jurisdiction of the European Court of Justice. However, what you have in these trade agreements is a dispute resolution mechanism, just as you have in the agreement with Canada, so the two do not go hand in hand. They do not go together.

I come to the observations of the noble Baroness, Lady Massey, who raised the important issue of children, children’s rights and how family law rights will be maintained after exit. Of course, there is provision at present in the Brussels 1a regulation for mutual recognition of family law decisions in the European Union, but that is a matter of mutual interest. There is no reason why that mutual agreement should not pertain after exit from the European Union, albeit not as a provision from within the European Union itself. I add that these regulations tend to have their origins, their foundation, in the Hague convention, which predates the European Union itself. We are confident that there will be a mutual interest in maintaining that sort of recognition.

Also, on the welfare of children, all the rights and obligations with regard to children will transfer into United Kingdom law. They are recognised as such. We will continue to engage with child and youth advocacy groups in the coming months as part of our strategy to ensure that a wide range of stakeholder perspectives are factored into our negotiations for exit. I add that my noble friend Lady Anelay has asked me to extend an offer from her to meet the noble Baroness, Lady Massey, to discuss these issues further, as she suggested might be the case.

Even as I come to the end of my time, if I can nevertheless strain your Lordships’ patience a little further—

[Noble Lords]

Oh!

[Lord Keen of Elie]

Or perhaps a lot further, I have one further point on mutuality raised by the noble Baroness, Lady Kennedy of the Shaws. She spoke about the importance of mutual recognition in the context of commercial judgments and so on. Again, one has to emphasise the word “mutual”. There is a mutual interest between the United Kingdom and the European Union in maintaining the ability to recognise choice of law and jurisdiction, and the ability to recognise the enforcement of judgments. The same applies in the context of wider security issues such as Europol, Eurojust and the European arrest warrant. It will be perfectly possible to negotiate a suitable outcome to these issues.

Finally, I will mention the question of Euratom, which was raised. I quite understand the concerns that arise with regard to it. However, I would make this point. It is not the case that Euratom is not part of the EU. The Euratom treaty is defined as one of the EU treaties. The first step that we will take on nuclear matters is domestic legislation that puts in place a clear structure for dealing with nuclear issues, including nuclear fission. Thereafter, we will of course take the appropriate step to have bilateral agreements with other countries, such as the United States, in order that we can maintain our position in the nuclear industry and the safety of our nuclear operations.

I have but touched upon many of the 64 contributions made today, and I can do little more at this stage of the evening. However, let me reiterate: it is not a case of Brexit meaning Brexit; it is the case that the people have spoken. They spoke in the referendum and it was determined that we should leave the EU. We are going to leave the European Union.

Amendment to the Motion

Tabled by

Guardianship (Missing Persons) Bill

Lord Keen of Elie Excerpts

2nd reading (Hansard): House of Lords
Thursday 6th April 2017 Lords Chamber

[The Advocate-General for Scotland (Lord Keen of Elie) (Con)]

My Lords, I add my congratulations to the noble Baroness, Lady Hamwee, on introducing this Bill. The Bill is similar in content and purpose to the Missing Persons Guardianship Bill, which she introduced in June 2016. I am grateful to her for withdrawing her Bill and taking on the present Bill, which is supported by the Government. It will create a new legal status of guardian of the property and financial affairs of a missing person.

The proposals now in the Bill have taken some time to evolve and have been developed in the light of views expressed from several sources over time. First, the All-Party Parliamentary Group for Runaway and Missing Children and Adults called for legislation in 2011, and the Justice Select Committee recommended guardianship legislation in its Presumption of Death report in 2012. These calls were supported during the passage of the Bill that became the Presumption of Death Act 2013. This parliamentary activity was supplemented by a public consultation on proposals for a scheme of guardianship by the Ministry of Justice in 2014. The response to that consultation, as already indicated by the noble Baroness, was overwhelmingly supportive.

Before commenting on the content of the Bill that has emerged from this extended period of development, I too acknowledge the work of the campaigners within and outside Parliament for the introduction of this guardianship Bill. I will not detain your Lordships with a lengthy list but in addition to the noble Baroness, Lady Hamwee, I would mention the noble Baroness, Lady Kramer, who introduced a Bill in similar terms to that of her noble friend Lady Hamwee, and my noble friend Lord Boswell, who promoted a Presumption of Death Bill in 2009 that started the train of legislation that we carry forward today. I also acknowledge the work of the Justice Committee in the other place and, outside Parliament, the campaigning of the charity Missing People, along with the help that it and we have received from Clifford Chance LLP in acting as pro bono lawyers to that charity.

Missing People and the charities Hostage UK and Prisoners Abroad, which have also supported the preparation of the Bill, bring together and give voice to the experiences of the individuals and families caught up in disappearances, as referred to by the noble Baroness, Lady Hamwee. I am grateful to all those who have contributed to their work and in particular to Claudia Lawrence’s father, Peter Lawrence, who I understand is here. He has campaigned to create a practical legal remedy for the benefit of all people caught up in the property and financial effects of disappearances.

I now turn briefly to the substance of the Bill. The Bill is necessary because, although the law assumes that a missing person is alive until the contrary is proved, the missing person’s property is effectively left ownerless while he or she is missing. No one has legal authority to protect it or to use it on their behalf. This can lead to practical and financial problems for the missing person, his or her family and others.

At present, people simply have to find ways to get by. Unlike situations where it is thought the missing person has died, there is no legal framework to assist the individuals caught up in the difficult consequences of a disappearance. The experiences of those left behind demonstrate that there is a gap in the law and that suitable advice is difficult to find. Families may be hit hardest, but banks and other institutions have to deal with cases of disappearance on an ad hoc basis, increasing uncertainty and risk.

Other approaches to reform would have been possible, but the creation of a new status of guardian of the property and affairs of a missing person is intended to fill the gap in the law in a way that will provide an accessible and readily understandable legal solution, while still protecting the interests of the missing person.

The first and foremost protection is that guardians will be appointed only by the court. The court must be satisfied that the person to be appointed is suitable to act as guardian and will act in the best interests of the missing person. The court will be either the High Court or the Court of Protection, and the Lord Chancellor will make this choice after consulting the Lord Chief Justice. The court will be able to impose conditions and restrictions in the terms of the appointment, including restricting the length of the appointment to less than the maximum four years permitted by the Bill. The court also has power to vary and revoke appointments.

The Bill also provides that interested parties will be able to hold guardians to account by court action and that guardians will be supervised by the Office of the Public Guardian, which will maintain a register of appointments and deal with complaints about the way a guardian is exercising his or her authority.

In this last respect and in a number of other places, the proposals in the Bill broadly follow the model of the provisions governing the appointment of deputies in the Mental Capacity Act 2005. The guardian will, for example, be the agent of the missing person, in much the same way as the deputy is the agent of the patient under the Mental Capacity Act 2005. Third parties, such as banks and other financial institutions, will be protected in their dealings with guardians in much the same way as they are when they deal with people acting under powers of attorney. Most importantly, they will be able to see the extent of the guardian’s authority to act on the face of the guardianship order made by the court and will be able to rely on it.

Some of the detail of the scheme of guardianship will be set out in rules of court, regulations and statutory guidance. To allow these to be drawn up and for potential users to familiarise themselves with them, the Bill is unlikely to come into force earlier than one year after Royal Assent, but the Government will endeavour to keep any delay to an absolute minimum.

The Government are committed to helping those left behind by the traumatic and disruptive event that is the disappearance of a family member. The number of cases in which the remedy will be used may not be huge, but the effect of each of those disappearances on those caught up in them can be severe and traumatic. The creation of the new legal status of guardian of the property and financial affairs of a missing person will not solve every problem created by a disappearance, but it should provide an effective, practical and relatively straightforward remedy to some at least of the practical problems that are created in these circumstances. There is, of course, concern about the risk of abuse of authority that can never be completely eliminated, but the Government believe that the provisions in the Bill strike an appropriate balance between giving the guardian the freedom to act to do good on the one hand and protecting the interests of the missing person on the other.

I commend the Bill to the House.

Collection of Fines etc. (Northern Ireland Consequential Amendments) Order 2017

Lord Keen of Elie Excerpts

Thursday 23rd March 2017 Lords Chamber

Moved by

[Lord Keen of Elie]

That the draft Orders and Regulations laid before the House on 6, 9 and 27 February be approved. Considered in Grand Committee on 21 March.

Motions agreed.

Collection of Fines etc. (Northern Ireland Consequential Amendments) Order 2017

Lord Keen of Elie Excerpts

Tuesday 21st March 2017 Grand Committee

Moved by

[Lord Keen of Elie]

That the Grand Committee do consider the Collection of Fines etc. (Northern Ireland Consequential Amendments) Order 2017.

[The Advocate-General for Scotland (Lord Keen of Elie) (Con)]

My Lords, the draft order, which was laid before the House on 6 February and which was approved in the other place on 14 March, is made under Section 84(2) of the Northern Ireland Act 1998. The Northern Ireland Act allows changes to be made to legislation that are necessary because of an Act of the Northern Ireland Assembly. This order is made in consequence of the Justice Act (Northern Ireland) 2016, which was passed by the Northern Ireland Assembly on 14 March 2016 and received Her Majesty’s Assent on 12 May 2016.

Part 1 of the 2016 Act fundamentally reforms arrangements for the collection and enforcement of fines in Northern Ireland by creating a new regime that provides additional ways for offenders to pay their fines. It includes powers for collection officers to secure payment through an attachment of earnings order, which is a court order made in Northern Ireland that requires a debtor’s employer to deduct specified amounts from wages and pay them to the court to discharge the outstanding amount.

The order will amend Schedule 5 to the Courts Act 2003 to enable fine collection officers and courts in Northern Ireland to obtain or verify certain information from HM Revenue & Customs, including the name and address of any employer the individual may have and details of any earnings or other income that the individual receives. This information will allow fine collection officers in Northern Ireland to determine whether an attachment of earnings order is an appropriate enforcement option to be pursued in respect of the debtor.

Schedule 5 to the 2003 Act already enables Her Majesty’s Revenue & Customs to make such disclosures in England and Wales, and the amendments made under the order will allow it to do so in Northern Ireland as well. Such amendments could not be made by the Department of Justice in Northern Ireland through the 2016 Act because Section 18 of the Commissioners for Revenue and Customs Act 2005 stipulates that conferring such powers on HMRC cannot be carried in Northern Ireland legislation and can be done only through Westminster. However, Section 84(2) of the 1998 Act allows for such amendments to be made by an Order in Council, such as this order, if “necessary or expedient” and I consider that the proposed amendments are necessary to facilitate the effective operation of the attachment of earnings provisions of the 2016 Act.

I am happy to confirm to noble Lords that Ministers and officials of the United Kingdom Government and the Northern Ireland Department of Justice have worked closely together on this draft order, which I commend to the Committee.

[Lord Browne of Belmont (DUP)]

My Lords, I thank the noble and learned Lord for his very comprehensive explanation of the order, and I very much welcome the order, which will provide the courts in Northern Ireland with additional sentencing, collecting and enforcement options. It will go a long way in helping to reduce the number of people—I believe 2,000—who are jailed each year for non-payment of fines by increasing the availability of community-based options in place of custody, by deducting money from their benefits each week. I believe that the vehicles of habitual offenders can be seized.

Can the Minister say how much money in unpaid fines is owed to the Stormont Government, going back over the last number of years, and how much money in police time is spent in enforcing fines? Is the Minister confident that there are enough safeguards with regard to the policy of possible seizure of vehicles? However, these amendments will go a long way and will prove effective in saving money.

[Lord Beecham (Lab)]

My Lords, this order—one of five we are discussing today—is the only one so far to have been taken in the Commons. In that place a very brief explanation was given by the Minister—the noble and learned Lord has given a rather fuller explanation than was given then—and my honourable friend David Anderson replied with a sentence only. I do not propose to add to that except to say that the noble Lord who has just spoken has raised some salient points and I was interested to hear what he said. We certainly have no objection to the order.

[Lord Keen of Elie]

I am obliged to noble Lords. I will address the points raised by the noble Lord, Lord Browne of Belmont. I do not have precise figures for outstanding fines, but if those figures can be collated I undertake to write to the noble Lord, although I am not sure that they can be collated in the manner he indicated. However, perhaps at a higher level of generality, I can say that at present we are dealing with about 20,000 cases a year where there is a financial imposition. Of those, more than 16,000 currently result in a default hearing, and the default hearing itself is an extremely time-consuming exercise, taking up manpower and, in particular, police time. It is anticipated that with these measures we will be able to reduce the number of default hearings to something of the order of 4,000 cases. That in itself will bring about a significant saving in time and money. I hope that goes some way to satisfy the points raised by the noble Lord. With that, I invite agreement to the order.

Motion agreed.

Public Guardian (Fees, etc.) (Amendment) Regulations 2017

Lord Keen of Elie Excerpts

Tuesday 21st March 2017 Grand Committee

Moved by

[Lord Keen of Elie]

That the Grand Committee do consider the Public Guardian (Fees, etc.) (Amendment) Regulations 2017.

[The Advocate-General for Scotland (Lord Keen of Elie) (Con)]

My Lords, these regulations apply to England and Wales and reduce the fee for registering enduring and lasting powers of attorney. The current fee of £110 will be reduced to £82. The resubmission fee, paid when an application has to be resubmitted because of an error with the original application, will be reduced to £41 from £55. If Parliament agrees, we intend these changes to take effect on 1 April this year.

The new fee will be an enhanced fee, allowing us to cover the full cost of registering a power of attorney as well as to ensure the efficient and effective discharge of the public guardian’s functions. The power to charge an enhanced fee is contained in Section 180 of the Anti-social Behaviour, Crime and Policing Act 2014.

There are currently more than 2 million powers of attorney registered. These comprise lasting powers of attorney and their predecessor enduring powers of attorney, which remain valid and may still be registered. In October 2017, we will celebrate 10 years since lasting powers of attorney were introduced. In that time, the Office of the Public Guardian, the body responsible for maintaining a register of powers of attorney, has registered nearly 2.5 million powers.

The high uptake of lasting powers of attorney is an indication of the success of the Mental Capacity Act. They allow individuals to plan ahead for a time when they may lack capacity to make decisions for themselves and to appoint someone they trust to make those decisions for them. It is, of course, positive that so many more people are now making powers of attorney, but it has led to a position where the income we receive from fees charged is exceeding the cost of delivering the service. A detailed review of power of attorney fees, together with an improved forecasting model for volumes of applications, taking into account the ageing demographic and the rise in dementia, has enabled us to take decisive action to reduce fees and bring them closer to the cost of providing the service.

As many more people have been registering LPAs in recent years, increased volumes coupled with greater efficiencies in processing applications have resulted in fees being charged above the operational cost of delivering the service without our having exercised the power provided by legislation to allow us to do this. Clearly this situation must be remedied, which is what these draft regulations seek to do. Furthermore, alongside the reduction in fee, we will also introduce a scheme for refunding a portion of the fee to customers who may have paid more than they should. Full details of the scheme will be announced in due course. We will take such steps as are necessary to make sure that people are made aware of, and receive, the refunds to which they are entitled.

The Government’s aim is to ensure that the public guardian’s functions are properly resourced. We consider that an enhanced fee will go towards funding vital wider functions carried out by the Office of the Public Guardian. The enhanced fee will allow the public guardian to ensure that those who cannot afford to pay still have access to the key services offered by the Office of the Public Guardian; there is a remission scheme in that regard. The fee will also contribute to costs of the public guardian’s safeguarding activities, including the annual costs of supervising deputies appointed by the court to manage the affairs of people who have lost capacity to do so for themselves. I therefore commend these draft regulations to the Committee, and I beg to move.

[Lord Beecham (Lab)]

My Lords, I am not sure whether I need to declare an interest in this matter as having registered an enduring power of attorney myself, which might entitle me, I suppose, to a rebate. It is pretty unlikely, I suspect, but it is a possibility and I shall have my old firm explore it.

Obviously, therefore, I welcome the main thrust of the order, which is to reduce the fees from their current level. The Government have acted perfectly properly in that respect. However, it is interesting that the Explanatory Memorandum confirms what the Minister has described as the Government’s policy—namely, that they have decided,

“in view of the financial circumstances and given the reductions in public spending, that a fee above full cost is necessary in order to ensure that the Public Guardian is adequately funded and that safeguarding the vulnerable is protected in the long term”.

That does not seem to be a logical explanation for retaining, albeit now reduced, a fee that is above the full cost. It is a philosophy which I hope will not be applied elsewhere in public services—namely, that you contribute not just to the cost but to an excess of the cost. Have the Government made any estimate of how much they will benefit by this device over time? How do they justify charging more than it actually costs to provide the service? They have been doing so, as it were, unconsciously for some time; now they will do so consciously. That strikes me as a very odd way of proceeding.

[Lord Keen of Elie]

The fees charged in respect of a power of attorney in 2007, when the scheme came in, were £150. They have reduced steadily since then, although they increased between 2009 and 2011, while transitional measures were being taken to upgrade IT for the Office of the Public Guardian. When they were reviewed in 2013, they were brought down. Subsequently, audit has indicated that they are still above a necessary and appropriate level.

However, with regard to the question about the enhanced fee, that allows for the fact that over and above the actual cost of dealing with a power of attorney, the Office of the Public Guardian also has to deal with other costs and demands—namely, those involving the application of parties who get a fee exemption and therefore the cost of their application has to be covered, as well as the cost of appointing deputy supervisors by the court. I did not use the correct term. It is not deputy supervisors but supervising deputies.

[Lord Beecham]

Not that it matters.

[Lord Keen of Elie]

I am sure it does—to somebody. Therefore, the limits in Section 180 of the 2014 Act are there to ensure that although we can recover more than the actual costs of the operation itself, it is for the purposes of funding the wider demands on the Ministry of Justice.

[Lord Beecham]

Is there any report of how that actually works in practice? I do not expect the Minister to have the answer today but what is the amount that has been raised in that way and where has it been spent?

[Lord Keen of Elie]

So far as the additional funding is concerned, I should have made it clear that it is funding for the Office of the Public Guardian and not wider than that. As to the precise sum, no, I do not have the figure to hand.

[Lord Beecham]

I am sure the Minister will write to me in due course.

[Lord Keen of Elie]

I will do that.

[Lord Beecham]

I am obliged.

Judicial Pensions (Additional Voluntary Contributions) Regulations 2017

Lord Keen of Elie Excerpts

Tuesday 21st March 2017 Grand Committee

Moved by

[Lord Keen of Elie]

That the Grand Committee do consider the Judicial Pensions (Additional Voluntary Contributions) Regulations 2017.

[The Advocate-General for Scotland (Lord Keen of Elie) (Con)]

My Lords, I will set out the purpose of the draft regulations in turn.

First, the fee-paid regulations are required to establish a pension scheme for eligible fee-paid judges, to mirror the existing pension scheme for salaried judges established by the Judicial Pensions and Retirement Act 1993. This is required following the court’s decision in the case of O’Brien v Ministry of Justice. These regulations make provision for a pension scheme for the benefit of those people who have held eligible fee-paid judicial office between 7 April 2000 and 31 March 2015. They also establish the Fee-Paid Judicial Added Voluntary Contributions Scheme, the Fee-Paid Added Years Scheme and the Fee-Paid Judicial Added Surviving Adult Pension Scheme to enable members of the principal scheme to pay voluntary contributions towards the costs of additional benefits under one of more of these additional schemes.

Following the case of O’Brien v Ministry of Justice and subsequent decisions it is now established law that a lack of a pension and other specified benefits amounted to less favourable treatment than some fee-paid judicial office holders in comparison to salaried judges doing the same or broadly similar work, contrary to the part-time work directive. The Ministry of Justice made a commitment to implement a pension scheme for these fee-paid judges. This commitment was honoured for future service, subject to transitional protection, by the Judicial Pensions Regulations 2015. However, a new scheme is required as the remedy in respect of reckonable fee-paid service from 7 April 2000—the date when the part-time work directive ought to have been transposed into UK law. The power to create such a scheme was created by Section 78 of the Pensions Schemes Act 2015, which inserted a new Section 18A into the Judicial Pensions and Retirement Act 1993.

The draft fee-paid regulations have been the subject of a detailed public consultation and were modified as part of that consultation process, taking account of responses and as part of our own review of the draft. A response to the consultation was published on 27 February alongside the final draft regulations.

The amendment regulations amend the Judicial Pensions Regulations 2015 to take account of the creation of the fee-paid judicial pension scheme and ensure parity of treatment between individuals with entitlement in the existing Judicial Pensions and Retirement Act 1993 scheme and those with entitlements under the fee-paid scheme in respect of their pension entitlements under the 2015 regulations. In addition, we are taking the opportunity to amend the 2015 regulations to make a number of other changes: to amend a drafting error in Regulation 1 of the 2015 regulations; to enable the Lord Chancellor to determine the eligibility of particular Scottish fee-paid judicial officeholders to join the pension scheme created by the 2015 regulations; to remove negligence as a basis for forfeiture or set-off; to make a correction to the definition of index adjustment for revaluation purposes; and to apply full and tapering protection for those judges who were in fee-paid office on 31 March 2012 but who have subsequently been appointed to salaried office.

The 2015 regulations were made under the Public Service Pensions Act 2013 to create a career average pension scheme for judicial officeholders as part of the Government’s wider reform of public service pensions. This is the first time the 2015 regulations have been amended.

Thirdly, I turn to the additional voluntary contributions regulations, the purpose of which is to make provision to establish a judicial additional voluntary contributions scheme. This is a money purchase scheme that enables scheme members to make contributions within a range of investment options. This is in addition to their contributions to the 2015 scheme. The AVC scheme is to be managed by the Lord Chancellor and the Judicial Pensions Board will oversee the governance. The 2015 judicial pension scheme was established on 1 April 2015 in response to the Public Service Pensions Act 2013. The 2015 scheme applies to fee-paid and salaried judicial officeholders.

The existing judicial pension schemes provided a facility to contribute to a money purchase pension scheme and the same facility is provided for members of the 2015 scheme through these AVC regulations. This includes the pension flexibilities contained in the Taxation of Pensions Act 2014 and the Pension Schemes Act 2015. Amendments to the additional voluntary contribution scheme established under the older judicial pension scheme, made by the Judicial Pensions and Retirement Act 1993, are being made in separate instruments containing similar regulations, which also give effect to the pension flexibilities.

To summarise, the fee-paid regulations are necessary as the remedy to provide eligible fee-paid judges with pension benefits that are equivalent to their salaried comparators. The amendment regulations are necessary as they introduce a range of amendments required to the 2015 judicial pension scheme. The additional voluntary contributions regulations are necessary to honour the department’s commitment to provide such a facility to members of the 2015 judicial pensions scheme. I hope that noble Lords will welcome these three sets of regulations as necessary to make important provision for judicial pensions. This is in terms of the Government’s legal obligations and to meet outstanding commitments, and to ensure that all the necessary arrangements are in place for a consistent approach relating to the relevant provisions across the judicial pension schemes. I therefore commend these draft regulations to the Committee.

[Lord Beecham (Lab)]

My Lords, I must declare a paternal interest since my daughter is a part-time, fee-paid district judge. The noble and learned Lord will, no doubt, be particularly pleased with the Judicial Pensions (Amendment) Regulations 2017 inasmuch as they contain a rather rare provision for the Scottish Government to request permission to join a national UK scheme, which is a remarkable volte face from the present Administration in Edinburgh. No doubt the noble and learned Lord will make that point on his next return to that city, and I wish him well in such an approach.

The three regulations dealing with judicial pensions are, of course, welcome so far as they go, but they come at a time when we face a shortage of judges and apparent difficulty in finding sufficient numbers of suitable applicants to fill a rising number of retirements. The Lord Chief Justice’s report of 2016 referred to,

“serious concerns about recruitment to the judiciary, in particular the ability to attract well-qualified candidates for positions in the higher levels”.

He pointed out that this created an impact both on the administration of justice and the position of the UK as a forum for international business litigation, where we are already facing growing competition from other jurisdictions.

The degree of unhappiness with the situation is reflected by results of a recent survey which shows that nearly half of High Court judges plan to retire early. Respondents to that survey alluded to resentment over loss of earnings, deteriorating working conditions and even fear for their personal safety in court. The latter will not have been helped by the scurrilous campaign against the judges by sections of the media and the further reaches of the Conservative Party and of UKIP, which were roundly denounced by the Minister, much to his credit.

A survey of judicial attitudes last year showed that 42% of all judges would leave if they had a viable option, nearly double the number of the previous survey in 2014. A more recent survey suggests that 47% of High Court judges and 36% of all judges indicated they would consider early retirement from the Bench over the next five years. Their attitude is partly coloured by the large number—78%—who suffered a loss of net earnings over the past two years and the 62% who were affected by pension changes. The Lord Chief Justice warned in 2016 that a new High Court judge would have a pension less than that of a District Judge, which is hardly conducive, one might think, to retention or recruitment to the High Court. He also felt that the situation was likely to have a considerable inhibiting effect on promoting gender and ethnic diversity, which the survey disclosed. Significantly 43% of judges felt unappreciated by the public but, tellingly, only 3% felt they were esteemed by the media, and, shockingly, only 2% felt they were esteemed by the public.

If this were not bad enough, one-third complained of the quality of court buildings and two-thirds referred to the low morale of court staff. Just over half the judges expressed concerns for their safety in court, partly due to the number of unrepresented litigants, especially in somewhat fraught cases in the family side of the courts’ work. The same proportion said that out-of-hours work was affecting them—a rise from 29% in 2014.

Currently there is a shortage of 25 High Court judges and between 120 and 140 circuit judges. Lord Justice Burnett, who is vice-chairman of the Judicial Appointment Commission, has complained that suitable applicants for the High Court have been insufficient in the past two years, while the demands on the judiciary continue to grow across the whole system. It would appear that only 55 applications were made last year for 25 vacancies and only eight were filled.

--- Later in debate ---

What steps will the Government take, and when, to fulfil the Lord Chancellor’s pledge? Today’s regulations are unlikely to make a significant contribution to the growing crisis in our courts. The noble and learned Lord is unlikely to be able to give us a clear indication of what the Government have in mind, but he could at least give us a timescale as to when conclusions will be reached. What is happening so far is not making any significant impression on a serious backlog and a serious prospect for the future.

[Lord Keen of Elie]

I thank the noble Lord for his observations. I appreciate that these regulations may be only a small step in trying to ensure that we are in a position to maintain what is still a world-class judiciary that is respected around the globe, not just in this country.

Recruitment to the Bench has often been an issue in circumstances where we seek to appoint only the best. There are competing issues when it comes to appointment to the High Court Bench. It is not simply a matter of salary, nor of pension, although I readily acknowledge that these matters have to be addressed. That is not what drives people towards the higher ranks of the judiciary at a later point in their career. Rather, I would suggest it is the desire to put something back into a system of which they have been a part for many years. We are succeeding there.

The noble Lord referred to the chair of the Judicial Appointments Commission, the noble Lord, Lord Kakkar, who is taking steps to broaden the pool of talent that can be attracted to the upper reaches of the judiciary, including to the solicitor branch of the profession, which has often been, if not ignored, perhaps overlooked to a greater or lesser extent when it comes to judicial appointment. They also address direct appointment to try to ensure that people do not feel that they have to go into a judicial career part time for many years before they can find themselves eligible for appointment to the High Court Bench. Steps are therefore being taken.

I infer from the noble Lord’s comments that he will welcome the Prison and Courts Bill that we recently introduced in the other place and the developments that that will bring about in court reform, in particular digitisation of the court process. That will ensure that a greater degree of judicial time can be made over to matters that should truly engage the requirements for our higher judiciary. I look forward to his assisting with that Bill as it progresses through our House. I am obliged to the noble Lord.

Motion agreed.

Judicial Pensions (Fee-Paid Judges) Regulations 2017

Lord Keen of Elie Excerpts

Tuesday 21st March 2017 Grand Committee

Moved by

[Lord Keen of Elie]

That the Grand Committee do consider the Judicial Pensions (Fee-Paid Judges) Regulations 2017.

Motion agreed.

Judicial Pensions (Amendment) Regulations 2017

Lord Keen of Elie Excerpts

Tuesday 21st March 2017 Grand Committee

Moved by

[Lord Keen of Elie]

That the Grand Committee do consider the Judicial Pensions (Amendment) Regulations 2017.

Motion agreed.

Digital Economy Bill

Lord Keen of Elie Excerpts

Report: 2nd sitting (Hansard - continued): House of Lords
Monday 20th March 2017 Lords Chamber

[The Advocate-General for Scotland (Lord Keen of Elie) (Con)]

My Lords, I am obliged to the noble Baroness, Lady Hamwee. Amendment 25YX and the related Amendments 28CB, 28CG, 28DV and 28FD seek to impose an express requirement that the public service delivery power may be used to share information only to the extent that it is necessary and proportionate to do so. That covers the changes to debt fraud research and similar civil registration provisions in the Bill. With respect, the amendments are unnecessary as the powers will need to be exercised in line with the Data Protection Act and the codes of practice, which already require that only the minimum data necessary to fulfil the particular objective may be shared. It is therefore unnecessary to amend in accordance with this proposal.

The effect of Amendment 25YYD would be that the list of specified persons permitted to use the public service delivery power could be amended only to add or remove bodies. The removal of the word “modify” would affect the way that minor amendments could be made. I do not believe that the noble Baroness, Lady Hamwee, expressly referred to this amendment, but as it is listed in this group as her amendment I just mention the point because clearly it is necessary that there should be a degree of flexibility in how that provision operates.

[Baroness Hamwee]

I apologise; I thought that was in another group, though I received a note later. I would like to understand how extensive a modification might be.

[Lord Keen of Elie]

I am obliged to the noble Baroness. I am happy to explain within this group, where I understand the amendment remains. The removal of the word “modify” would affect the way in which minor amendments could be made. For example, where a body changes its name or the description of the category of a body needs to be adjusted, you would then want to modify rather than delete and start again.

Amendment 26A seeks to remove reference to,

“the contribution made by individuals or households to society”,

from the public service delivery chapter. Again, I venture that the amendment is unnecessary because subsection (10) gives examples of “well-being” but does not provide an exhaustive list. Therefore we have three categories by way of example—but only by way of example. In response to the specific observation made by the noble Baroness, Lady Hamwee, I respectfully suggest that there is nothing paternalistic or judgmental about any of the examples given in the Bill. Indeed, where a party makes a contribution to society, that benefits the contributor as well as society, which is why it is appropriate that it should be given as an example in this context.

Amendment 28AU would provide a new definition of “personal information” for the purposes of the public service delivery power. This point was raised in Committee as well. The amendment expressly incorporates the definition of “personal data” under the Data Protection Act 1998 into the definition of personal information for the purposes of these powers, as well as making clear that the Bill’s extended definition also includes deceased individuals and companies. We consider that the existing provisions set out the same position, albeit in slightly different words. I note that reference was made to the issue in Committee, and to the provision of codes of practice in that context.

The intention of Amendment 28AY seems to be to provide greater transparency by ensuring that individuals would know when information about them has been shared. Existing provisions in the Bill already require those using the powers to comply with Data Protection Act requirements as to the information that people are given about the usage of their personal data. This, supplemented by the requirements imposed by applicable codes of practice, ensures that the use of these powers will be as transparent as it can be.

Amendments 28AR and related amendments seek to narrow the exceptions to the general rule in Clause 36(1) that personal information received under the public service delivery powers may be used only for the purpose for which it was shared, to the effect that such information may not be shared for the purpose of preventing anti-social behaviour, and to restrict the exception permitting disclosure for the purpose of preventing or detecting crime to “serious” crime, as indicated by the noble Baroness. These amendments would also bring in an offence of disclosing personal information for the purposes of anti-social behaviour. The prevention of anti-social behaviour and the prevention or detection of crime are matters of significant public interest. If information sharing indicates potential criminal activity, public authorities should be able to take action. Similarly, if information received under the powers indicates that anti-social behaviour is occurring or is likely, we consider that this information should be disclosable to maintain public order. Anti-social behaviour may itself be seriously harmful to those who become its victims.

Amendment 28BM seeks to remove the power given by Clause 40(4), which allows regulations to make disclosures by newly specified persons subject to the same conditions that apply to disclosures of information provided by HMRC. That power would be used to require the consent of the original provider to any subsequent disclosures of particularly sensitive information, as is the case for information provided by HMRC under Clause 38. The amendment is undesirable, as it would remove flexibility to give enhanced protection to information from certain sources. I do not believe the noble Baroness read the provision in that form, but it is there so that enhanced protection may be given in a particular circumstance.

Amendment 28CF would impose a duty on the Secretary of State to review the civil registration power after three years, akin to the powers already provided in the debt and fraud powers. This duty was included in the debt and fraud powers to assess whether the powers deliver demonstrable benefit via an initial piloting process. The information gathered in the course of the pilot process will provide evidence for the review. It is our view that a similar duty to review the civil registration power would not be appropriate. First, civil registration information is already a matter of public record. Secondly, the powers are simply looking to update outmoded legislation to simplify and provide the flexibility to share civil registration data within the public sector to avoid the need to enact specific powers whenever a new need arises. The power has been developed to support a range of public authorities at national and local government level to transform the services that they can provide to citizens.

Finally, Amendment 39 is intended to ensure that Part 5 could not be brought into force until after the GDPR comes into effect, which would be in May 2018. This would prevent the use of the powers until that date, which would be unhelpful given that a number of bodies are keen to use the powers to achieve particular objectives, such as extending the warm home discount scheme. As we have said before, we consider that the present provisions are compatible with the GDPR—compliant, therefore, in that context—and we are committed to revisiting the codes of practice before May 2018 to ensure that they reflect the latest best practice of compliance with the GDPR.

In those circumstances, I invite the noble Baroness to withdraw her amendment.

[Baroness Hamwee]

My Lords, I thank the Minister, but all that will bear some reading. We felt it important to extend some of the comments that we made in Committee to get a more extended response. Noble Lords will be pleased to know that I shall not respond to all those points. On the Minister’s first point about “necessary or proportionate”, I do not know whether he means that I misread the ICO’s comments, that the Government disagree with the ICO, or whether some of the changes to the Bill since its initial form have dealt with them. Perhaps I should just leave that hanging.

The fact that the “contribution to society” is an example does not answer our concerns. I remain anxious about it, as I do about “anti-social behaviour”, which the Minister described as being a matter of significant public interest. I do not dispute that, but data sharing is a matter of significant public interest—I suggest, possibly greater. We are told that anti-social behaviour may be seriously harmful, but it is not criminal in this context, because we have other provisions to deal with crime.

I was indeed confused about the application of the HMRC powers to other bodies, and I remain confused about whether that extension is appropriate.

Finally, of course civil registration information is a matter of public record, but the updating takes us into a very different regime. The ability to share information in bulk is very different from that to look up individual pieces of information. Can the Minister tell the House today whether the consultation to which he referred extended beyond the sharing organisations to the sort of bodies concerned with privacy? He may not know, and I may be quite out of order in asking this on Report. I do not think he is going to leap to his feet—pause—no, he is not. I do not hold that against him. It is probably not in his brief. If there was not such consultation, that answers my point.

However, clearly, I should beg leave to withdraw the amendment.

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Moved by

[Lord Keen of Elie]

25YY: Clause 31, page 30, line 23, leave out “a specified objective” and insert “an objective which is a specified objective in relation to each of those persons”

[Lord Keen of Elie]

My Lords, the Delegated Powers and Regulatory Reform Committee made a number of recommendations on Part 5 of the Bill. The Government developed the information-sharing powers through consultation and partnership over a process that started over three years ago. These measures are about improving the way the Government operate for the public benefit. Of course, data sharing must be done with transparency, safeguards and oversight. It is in that spirit that we have accepted the bulk of the committee’s recommendations. The way in which Part 5 is structured in seven chapters to deal with different data-sharing powers has meant that it has taken nearly 100 amendments to implement the recommendations, so I will spare the House from referring to every one in turn. I believe that my noble friend Lord Ashton has written previously setting out all that detail.

Our amendments place the lists of specified persons able to disclose and use information under the public service delivery, debt and fraud powers on the face of the Bill rather than in regulations. We then also narrow the powers to amend the lists. For public service delivery, specified persons will be permitted to share information only for the purposes of an objective which has been expressly specified as applicable to that person, rather than any specified objective. We have also narrowed the ability to set and amend data-sharing objectives for public service delivery, so that any specified objective must support the delivery of a specified public authority’s functions.

For water and fuel poverty, we have restricted the powers to amend the list of support measures and to add to the list of permitted recipients of information under the clause, as the DPRRC recommended. Finally, we have adopted the committee’s recommendations to remove Henry VIII powers to make consequential amendments to primary legislation, as well as to narrow the powers to review and amend the fraud and debt powers. We have ensured that any amendments can be only to improve the operation of the fraud and debt powers and there will be no way to use these powers to undo the safeguards that the Bill provides.

In addition to the DPRRC’s recommendations, the Government have tabled amendments on the following matters. Amendments 28FE and 28FF remove repetition in Clause 60(5) relating to the criminal offences which protect personal information originating from HMRC, Revenue Scotland and the Welsh Revenue Authority. By removing this repetition, the amendments avoid any confusion which might otherwise be caused.

Amendments 28FG to 28FN correct an unintended consequence of measures that were agreed during Lords Committee stage to prevent disclosures by journalists in the public interest being caught by the anti-disclosure offences in Chapter 5. The unintended effect is that the criminal offence which protects personal information disclosed under Clause 60(1), and which originates from one of the tax authorities, now applies only to disclosures made by the person who first receives the information but not those within the accreditation system who subsequently receive the information—for example, to undertake peer review or via intermediaries. These amendments therefore restore a key safeguard to the research power, which ensures that information is protected in all parts of the process.

Amendments 28FW, 28FX, 37 and 38 provide new data-sharing powers for Scottish Revenue and the Welsh Revenue Authority. Clause 70 provides the power for HMRC to share de-identified data, allowing HMRC to share aggregate and general information more widely, for purposes in the public interest. Following discussions with the Welsh Government and the Scottish Government, as requested by them, we are providing equivalent powers for devolved tax-raising bodies.

Amendment 28FY, tabled by my noble friend Lord Hunt, is supported by the Government. There is a recognised sound public policy argument for supporting the more effective operation of the Employers’ Liability Tracing Office, referred to as ELTO. The discussions at Lords Committee sparked further conversations between HMRC and ELTO officials, resulting in an agreement to take this amendment forward. This Bill has offered a timely opportunity therefore to legislate. The current clause meets the objective of helping ELTO improve its records of employers’ liability insurance policies, making it easier to identify insurers and so enable claimants to pursue compensation. Both parties recognise that there remains some work to do and it is currently unclear as to how effective HMRC data may be in helping to populate missing data. However, an enabling provision would allow more robust testing of the possibilities, with the opportunity to take these forward.

Amendments 40 and 41 enable commencement of measures by area so that the Government can ensure that measures are not commenced for Northern Ireland in the event that the Northern Ireland Assembly has not given legislative consent. Consent from the Northern Ireland Assembly is required on a number of measures, including the extension of public lending right to e-book loans, Part 5 of the Bill on digital government, the Northern Ireland provision in relation to Ofcom and, should the government amendment be agreed, the offence of breaching limits on ticket sales.

In consequence of the potential need to commence the Bill by area, these amendments also provide the power to make necessary transitional provision. The transitional powers will also be used to define small businesses in the statistics chapter of Part 5 until definitions in the Small Business, Enterprise and Employment Act 2015 come into force. I beg to move.

[Lord Hunt of Wirral (Con)]

I declare my interest as a partner in the global law firm DAC Beachcroft, and other interests set out in the register, including chairing the British Insurance Brokers’ Association and being president of the All-Party Parliamentary Group on Occupational Safety and Health. Taken at face value, Amendment 28FY would appear somewhat technical, but the Employers’ Liability Tracing Office is working well, but it could work better, and this amendment would help to facilitate that.

I am so grateful to the Minister and his colleagues for the support that they have given to this amendment, which could make a substantial difference to the capacity of the office to help to secure compensation, expeditiously and effectively, for those afflicted by industrial illnesses. When someone faces a reduced quality of life and possibly an avoidably and unnecessarily early death because of an industrial illness innocently contracted, the least that we can do is to deliver compensation as quickly as possible in the hope that the individual with the illness can enjoy at least some benefit from it. I believe that in some small way the amendment will serve to make this a more civilised and compassionate country.

[Baroness Hamwee]

My Lords, we have two amendments in this group. The Minister was just a little previous in answering Amendment 25YYD on modification, so we do not need to go back to that. Amendment 33ZYD would remove several organisations from the list of specified persons for the purposes of fraud provisions, and the amendment is here to enable us to ask whether all these require the data-sharing gateway or, conversely, whether there are many other government-related organisations; I am not quite sure what the correct term might be for organisations such as the National Lottery or the British Council, but I shall use the term government-related organisations tonight. Are there not others that might use the power? What were the criteria used to select the ones that are in the schedule?

[Lord Keen of Elie]

I am obliged to my noble friend Lord Hunt and note what he said with regard to the amendment. On the amendment proposed by the noble Baroness, Lady Hamwee, Amendment 33ZYD, which seeks to remove a number of non-departmental public bodies listed in the schedule for the fraud power, I accept that the list in the schedule is long but the fact is that many public authorities are at serious risk of fraud. Each of the bodies was considered individually before being added to the schedule, and the NDPBs have been included because they each administer many millions of pounds in grant expenditure each year, which exposes them to a significant risk of fraud.

[Baroness Hamwee]

Were any organisations considered and discarded for that purpose?

[Lord Keen of Elie]

I am not in a position to say what number of bodies were considered and discarded, but I will undertake to write to the noble Baroness on that point. All the public bodies included in the schedule must, of course, comply with the data-sharing safeguards in the Bill. Clearly, public authorities may not enter into data sharing lightly. They will have to follow the codes of practice, comply with the Information Commissioner’s requirements on data sharing and privacy and have in place all necessary protections to prevent unlawful disclosure.

The list of public bodies in the government amendments is shorter than the lists we have previously published in draft regulations although, as I indicated to the noble Baroness a moment ago, I do not know how many bodies were considered and removed before the process of listing them in the draft regulations took place. Care has been given to ensuring that we share only where there is a clear benefit, as required by the legislation. I hope that, with that explanation, the noble Baroness will withdraw her amendment.

[Lord Collins of Highbury (Lab)]

My Lords, I will take this opportunity to briefly comment on this group of amendments. These Benches did submit a series of amendments in Committee. The Minister responded that the Government were giving due consideration to the Delegated Powers Committee report, so there was no opportunity to go through some of those issues in detail. We welcome the Government’s amendments and the fact that they have responded to the Delegated Powers Committee. I have read the Information Commissioner’s briefing for Report, and I welcome the fact that she strongly supports the Government’s adoption of these amendments, which she believes will strengthen parliamentary scrutiny and government accountability.

The next group of amendments deals with the code of practice, on which we had lengthy debates in Committee, but I believe that the Government are now striking the right proportional balance between improving public and government services and the need to protect data.

[Lord Keen of Elie]

I am obliged to the noble Lord.

Amendment 25YY agreed.

--- Later in debate ---

[Lord Collins of Highbury]

My Lords, in Committee I had my name to an amendment regarding the status of the codes of practice. At that time, the noble and learned Lord referred to the appropriate level of legal obligation. He certainly persuaded me that the wording “having regard to” or “complying with” did not relate to whether a public authority could ignore a code, but whether there were reasons for doing so. I was persuaded about that level of flexibility.

Of course, we were really concerned about what the codes of practice would ultimately look like, what the engagement of the Information Commissioner would be and what the Information Commissioner’s view was. On these Benches we were pleased to see not only the Government’s amendments but the Information Commissioner saying that she was extremely pleased that the Government had accepted her recommendations on there being references in the Bill to codes of practice and the privacy impact assessments.

In the light of the Information Commissioner’s overall comments and the fact that the Government have responded, we certainly welcome these amendments. However, I give notice that—the noble Baroness, Lady Hamwee, referred to this—what is in the codes and how public authorities operate them will be very important, and parliamentary scrutiny of and engagement in them will be critical in the future. I hope that we will see further drafts of the codes before they are ultimately laid before Parliament. It is really important not only that there is the highest level of consultation on them but that Members of Parliament are properly engaged in them.

[Lord Keen of Elie]

I thank noble Lords for their observations on these matters. There are of course government amendments in this group as well and perhaps I may begin with those.

This group of amendments concerns the codes of practice issued under Part 5 and those issued by the Information Commissioner’s Office. It includes the government amendments that implement the recommendations of the Delegated Powers and Regulatory Reform Committee and, as the noble Lord, Lord Collins, observed, the recommendations of the Information Commissioner’s Office. In addition, there are some opposition amendments on similar points.

We have already published draft codes of practice on data sharing. The Delegated Powers and Regulatory Reform Committee recommended that the first codes of practice and the UK Statistics Authority’s statement of principles should be laid before Parliament in draft and should not be brought into force until they had been approved under the affirmative procedure. Revisions were to follow the draft negative procedure. We agree and have tabled amendments to achieve this, and it is intended that Parliament should have a suitable opportunity to consider these drafts and any amendments thereto in due course.

A further series of government amendments will require persons disclosing personal information under relevant chapters of Part 5 to have regard to the Information Commissioner’s codes of practice on privacy impact assessments and privacy notices, transparency and control in so far as they apply to information which is being shared. As the noble Lord, Lord Collins, observed, the Information Commissioner called for explicit reference to these two codes to be made on the face of the Bill. We have worked with her office to develop these amendments, which supplement the existing requirement that the codes of practice prepared under the Bill must be consistent with the commissioner’s own code on data sharing, and I understand that she is satisfied with the steps we have taken in that regard. I hope that this will provide further assurance to noble Lords that we are committed to ensuring that best practice concerning compliance with data protection and transparency will be applied to the exercise of powers under Part 5 of the Bill.

I now turn to the opposition amendments in the names of the noble Baroness, Lady Hamwee, and the noble Lord, Lord Clement-Jones. I hope I can persuade them that their amendments are no longer necessary, as the government amendments fully address the concerns of both the Information Commissioner’s Office and the DPRRC.

As the noble Baroness has explained, the amendments in their names seek to ensure further consistency with the ICO’s codes and to strengthen the role of those codes in the regime set up by Part 5, as well as providing for greater parliamentary oversight of the Government’s codes, and I believe that we are now there. The Bill already requires that codes of practice issued under Part 5 of the Bill must be consistent with the ICO’s data-sharing code of practice. The government amendments further require persons to have regard to the ICO’s codes on privacy impact assessments and privacy notices, transparency and control when exercising relevant powers under Part 5. So we are now referencing all the codes which the ICO felt were critical for the operation of Part 5.

Of course, this is not the first time we have discussed amendments that seek to strengthen enforcement of the codes of practice by requiring authorities that use the powers of determined specified bodies to “comply with” rather than “have regard to” these codes. The Government’s position remains that “have regard to” is the right weight to give to codes of this type. That is itself a legal obligation, as the noble Lord, Lord Collins, noted. Moreover, the public law will expect those who are subject to the codes to follow their stipulations unless there are cogent reasons why they should not. We note that the Information Commissioner’s own codes are themselves advisory. A requirement to “comply with” the codes could lead to their being applied in a tick-box fashion, without due regard to whether the recommendations are actually applicable to and desirable in the context of the specific data share.

On the issue of adding additional persons to the consultation obligations for the codes, since Ministers have committed before Parliament to consult publicly on the Part 5 codes of practice, we suggest that such a requirement is unnecessary. The present provisions reflect what the noble Baroness noted to be the normal position.

Finally, on parliamentary oversight, the Government’s amendments fully implement the DPRRC’s recommendations, including, exceptionally, the use of the affirmative procedure for the first codes and the draft negative procedure thereafter. They go further than the noble Baroness’s amendment, and I hope that that will be welcomed by all noble Lords. I therefore invite the noble Baroness not to press her amendments.

[Baroness Hamwee]

My Lords, I thank the Minister for that response. I had forgotten to say that I was glad to see the government amendments about the affirmative procedure—it was because of looking at those that we got those two stray amendments that were tabled in error.

The noble Lord, Lord Collins, is absolutely right about the codes of practice. I simply say, before begging leave to withdraw, that it will not be possible for amendments to be made once the codes are put formally to Parliament. That is why wide consultation and—I do not like the term—an iterative process is very important on what will be significant documents. I beg leave to withdraw my amendment.

--- Later in debate ---

Moved by

[Lord Keen of Elie]

25YYH: Clause 31, page 31, line 1, after first “objective”” insert “, in relation to a specified person,”

--- Later in debate ---

[Lord Collins of Highbury]

My Lords, I hesitate before intervening in this group of amendments because, the last time I intervened, my noble friend said that I must be slightly confused, as I was talking about electoral rolls, bread rolls and toilet rolls. We are, of course, conflating a number of issues in this group, but I think that there is a really good point. My noble friend has raised an important area where the public good can be served not by sharing confidential information but by ensuring the availability of information that will serve a specific purpose in relation to fuel poverty. We on these Benches are very sympathetic on that point. In Committee we tabled amendments on the common-law duty of confidentiality, and the noble and learned Lord responded to those amendments. The only point I would make now is that it is vital that medical records remain confidential. They contain information that can affect not only people’s health but their access to jobs and to insurance. Access to a whole range of things is at risk if it is felt that this information will not remain confidential. Of course, the consequence of that is another public health issue, because if people do not have confidence that their records will remain confidential, they will not go to their doctor, they will not tell their doctor and they will not seek the treatment that they perhaps should. So there is a very strong case here.

One other point—it is not related to this group of amendments so I ask for forgiveness—is that there is a balance between maintaining confidentiality and security. Many of the problems in the health service, and why people lack confidence in it, are not about policies and procedures but about the health service’s ability to maintain a secure IT system. I hope the noble and learned Lord will be able to address those issues. The assurances that my noble friend has sought about future ability are really important. The ability to communicate—not the details of people’s confidential records but one government department to another and one public agency to another, to serve a very clear public need—is vital.

[Lord Keen of Elie]

I am obliged to noble Lords, and in particular I thank the noble Lord, Lord Whitty, for his continued interest in this area and for taking the time to meet and discuss this matter at some length with me and the Bill team. Clearly, as the noble Lord, Lord Collins, observed, this is an important part of the fuel poverty agenda. That is why it takes on such considerable importance even when faced with issues such as medical confidentiality.

On the point about common-law confidentiality, and medical confidentiality in particular, it is not an absolute; there are already statutory gateways through which information can and must flow on occasions, and therefore one must not take it that medical confidentiality is somehow completely ring-fenced and separate from the world that we actually live in. There are circumstances where there should be, has to be and is disclosure. It may be possible—I put it no higher in terms of this Bill—to address a further gateway. However, one should not confuse any mechanism within the Bill with the consequences of human or IT failure, however regrettable they may be. I agree with the noble Lord, Lord Collins, that one has to have regard not only to the structure within which information is shared but to the need to ensure that the sharing process is itself secure. But they are separate issues.

The noble Lord, Lord Whitty, acknowledges that some parts of his amendment may not be necessary. Amendments 27 and 28 would provide that information can be shared with licensed electricity and gas distributors for the provision of fuel poverty assistance. They can already be added to the data-sharing arrangements in Clause 32 by regulations. The Government will consider whether to exercise this power in the context of considering the future role of electricity and gas distributors in delivering fuel poverty schemes. I reassure the noble Lord that the provision made by Amendment 26 is already covered by Clause 31, which provides powers to share information for,

“the improvement of the well-being of individuals or households”.

Of course, this includes,

“their physical and mental health and emotional well-being”.

While we do not consider the noble Lord’s amendment necessary in this instance, the objectives that he highlights are an example of how in appropriate circumstances information held by healthcare providers could, in future, be valuable to support the more effective delivery of public services to those in need. It underlines why the Government are unable to accept Amendments 28AV, 28AW and 28AX, tabled by the noble Baronesses, Lady Finlay and Lady Hamwee.

The Government do recognise the particular sensitivities with identifiable health information, as highlighted in the National Data Guardian for Health and Social Care’s recent review of data security, consent and opt-outs. Health bodies in England are therefore not included in the list of bodies now in the Bill that will be permitted to use these powers. However, as the noble Lord, Lord Whitty, noted, health issues are a key factor in the complex social problems faced by people, whom we are aiming to support with these powers. Excluding the use of identifiable health information altogether would remove the possibility of including such information in the future without amending legislation. It would be premature to take this step in advance of the implementation of the National Data Guardian’s review and the public consultation that that will engage.

An amendment to maintain the common-law duty of medical confidentiality is not considered necessary. Those powers enable information to be shared only where it is already held by specified persons, acquired in a different context from the patient-doctor relationship. Any information that would have been subject to medical confidentiality would have found its way into a specified person’s hands only through an existing gateway. As I indicated earlier, there are already statutory gateways through which such information can move. Of course, we are dealing with permissive powers.

At this late hour, I will attempt the impossible: to satisfy the interests of all parties in the context of these provisions. Beginning with the inquiry from the noble Lord, Lord Whitty, health bodies are not presently included in the schedules. As drafted, it would be possible for health bodies to be added to the schedules at a future date but—and I emphasise this—no decision will be taken until, first, the Government publish their response to the Caldicott review and any recommendations have been embedded and assessed; secondly, there has been a public consultation on the issue and the views of the National Data Guardian and appropriate representative health bodies such as the GMC and BMA have been sought; and, thirdly, there has been a debate in both Houses pursuant to the affirmative procedure required to add bodies to the schedule. I hope that that reassures the noble Lord, Lord Whitty, that it can be done, although it has yet to be done, and that there are steps that we will take to reassure the noble Baronesses, Lady Finlay and Lady Hamwee, before any such step is implemented.

If health bodies or information were to be expressly excluded in the Bill, it would require primary legislation to enable those bodies to share information under the powers. If and when we decide that it would be helpful to have those powers—in implementing the fuel poverty initiative, for example—it would be most unfortunate if we were delayed by literally years before we could actually achieve the objective, when in fact there is provision here to do it by way of the affirmative procedure so that both Houses have ample opportunity for debate.

If we take those steps, there will be safeguards. When considering whether to add any health bodies to the schedules in the public service delivery, debt and fraud chapters, clear safeguards will apply. First, before a new body may be added to the schedule, it must show that it fulfils the relevant criteria relating to that specific power designed to ensure that only bodies with relevant functions for holding or requiring information relevant to that particular power may be added. The Minister must consider the procedures in place for secure handling of information before any new body can be added to the schedule—a point raised by the noble Lord, Lord Collins. A decision will be taken on whether it is in the public interest and proportionate to share identifying health information in order to achieve a specified objective. There would be no question of simply sharing this information more widely. The powers must be exercised in accordance with the Data Protection Act, which requires that only the minimum information necessary to achieve the objective may be shared. Under the Bill—and under the Data Protection Act—personal information may be used only for the purpose for which it was shared and data must be stored securely to ensure compliance with that Act. Again, this point was raised a moment ago.

Identifying health information will constitute sensitive personal data and so to ensure fair and lawful processing, it must fulfil one of the more onerous Schedule 3 conditions as well as the Schedule 2 condition under the Bill. In addition, new criminal sanctions have been included for wrongful disclosure with a maximum penalty of up two years’ imprisonment, a heavy fine or both. Further steps can of course also be taken to remove a body from the schedule if it does not comply with the requirements of the Act.

I do not suppose that I have satisfied anyone with that explanation at the end of the day. But, if nothing else, I hope that it has assisted in informing your Lordships as to why we consider that these amendments are not appropriate and that it would be appropriate to retain the ability to introduce health bodies by way of appropriate regulation. We feel that there will be appropriate safeguards and extensive consultation before any such step is taken, so I invite the noble Lord to withdraw his amendment.

[Baroness Finlay of Llandaff]

May I ask for clarification over one issue? Would a statutory instrument, when brought forward, envisage adding health bodies to the Bill in a blanket way, or would it be envisaged that there would be statutory instruments for specific purposes, such as health bodies for the purposes of identifying fuel poverty, and that when something else emerged it would require a separate statutory instrument so as to keep that gateway as narrow as possible?

[Lord Keen of Elie]

With respect, we clearly intend to maintain any gateway in as narrow a manner as is reasonable. The point that the noble Baroness raises is really a question for another day. We are not there yet; health bodies are not included in the schedule. If and when it is contemplated that they will be, there will be extensive consultations on the very issues that she raises.

[Lord Whitty]

My Lords, I thank the Minister for his ability to deliver a compromise position between what appeared to be diametrically opposed attacks in this group of amendments. He has done very well and almost satisfied me—I thank him for that and for his previous discussions.

Clearly, my amendments envisage a fairly narrow gateway, and in her latest remarks the noble Baroness, Lady Finlay, was responding to that. I am very grateful to the Minister for his assurance that the procedure could add health authorities and health bodies to the list in specific circumstances. When we come to the statutory instrument phase, I am arguing for only a relatively narrow inclusion, which may well be carried by the form of the statutory instrument which we eventually have to consider. I also recognise that the Minister has to await the outcome of these other considerations.

On the other hand, I would impress on the Minister that fuel poverty is a really big issue and that the lack of communication between the health and social security sides, and the other interventions, has proved a major inhibition in tackling fuel poverty. The information to be shared is in two directions. It would also allow a medical GP, for example, to access DWP information as to whether people in a household qualified for help. It is not simply a matter of disclosing medical information; it is one of ensuring that the medics actually understand the broader context of the household with which they are concerned.

I thank the Minister for his help in this direction. We will no doubt return to this at some subsequent stage but in the meantime, I beg leave to withdraw.

--- Later in debate ---

[Lord Stevenson of Balmacara (Lab)]

Briefly, the ground has been well covered by the noble Lords, Lord Foster and Lord Aberdare, and I have little to add. Three things strike me. I recalled in Committee that this was one of the areas where we had received the most external notifications and correspondence. It is still something that we need to take carefully. As has just been said, it is surprising that almost the entirety of the industry affected by the judgments of Ofcom have joined up to make the case.

Following on from both speeches, what is required is a statement from the noble and learned Lord. I am sure he is straining at the leash to give us all another compromise solution that will do the trick. He is shaking his head; maybe there are other things he has to cover as well. However, the situation seems to hinge on whether Article 4 of the EU directive applies sufficiently well after this Bill goes through, as before. Yet, as has been mentioned, there will be an opportunity, presumably in the great repeal Bill, to cover exactly this point. So what is the hurry?

[Lord Keen of Elie]

My Lords, I am obliged to noble Lords. As the noble Lord, Lord Stevenson, observed, there have been quite a lot of external communications on this. Indeed, I notice that the quotation that the noble Lord, Lord Foster, gave on my observations in Committee was identical to that quoted in a letter from Towerhouse LLP to the Department for Culture, Media and Sport on 17 March. Everybody seems to be singing from the same hymn book.

At present, Section 195 of the Communications Act 2003 requires that appeals against Ofcom’s regulatory decisions are decided by the Competition Appeal Tribunal on the merits. I shall come back to “on the merits” in more detail in a moment.

Appellants argue that appeals “on the merits” should allow for a bottom-up review of the decision, inviting the tribunal to substitute its own view for that of the regulator—in effect, two tiers doing the same thing. Appeals are therefore seen as an opportunity to rerun arguments that were considered and rejected by Ofcom in reaching its decision, or to put forward swathes of new evidence to persuade the tribunal to reach a different decision. Such appeals can lead to extremely lengthy and costly litigation, with extensive cross-examination of experts and witnesses. This depletes the regulator’s resources and means that other regulatory action by Ofcom is inevitably delayed, allowing for the potential for providers to frustrate the regulator with speculative or even spurious appeals, causing considerable uncertainty in the market and delay to other regulatory decisions.

The Government consider that appeals in the communications sector need to be rebalanced to ensure that Ofcom is held properly to account for its decisions, but also enabled to regulate in an effective and timely manner in the interests of citizens and consumers, as it is required to do. Clause 80 does just that; it requires that instead of merits appeals, the tribunal must decide appeals against Ofcom’s decisions by applying the same principles as would be applied by a court on a judicial review. Judicial review is generally a well-understood standard of review against which very significant decisions made by most public bodies are tested. Importantly, this will ensure that appeals are focused on identifying errors in Ofcom’s decisions, rather than simply seeking to persuade the tribunal to reach a different conclusion.

Those affected by Ofcom’s decisions will remain able to challenge them effectively. In Committee, the noble Lord, Lord Clement-Jones, said that judicial review was,

“solely concerned with whether the decision is unlawful in a technical sense—that is, was the correct process followed?”.—[Official Report, 8/2/17; col. 1734.]

I hope I can reassure him that this is simply not the case. First, appellants are able to argue that Ofcom’s decisions are based on material errors of fact or law. Material errors will therefore be identified and corrected in a judicial review process. Secondly, judicial review is a flexible standard of review, which allows the court to decide on the appropriate intensity of review according to the individual circumstances of the case. For example, there may be more intensive review processes in the context of matters pertaining to human rights. In particular, Ofcom has various statutory duties to ensure that its decisions are proportionate—in other words, that they go no further than is appropriate and necessary to attain a legitimate aim. In reviewing whether a decision is proportionate, the courts can carry out a closer and more rigorous review of the decision.

Of course, appeals in the communications sector are required to ensure that,

“the merits of the case are duly taken into account”,

as a matter of EU law under Article 4 of the EU framework directive. That will remain the case under a judicial review standard. I understand that there is uncertainty about the extent to which requirements in EU law may become a part of UK law after the United Kingdom leaves the EU, but that will be a matter for Parliament to determine when the great repeal Bill is introduced, as the noble Lord, Lord Stevenson, observed, and will be looked at in the context of the overall future regulatory framework for electronic communications, including the appeals regime, once the UK has left the EU.

A number of Ofcom’s regulatory decisions are already appealable only by way of judicial review, and the Court of Appeal confirmed as long ago as 2008 that judicial review is capable of taking account of the merits of the case, as required by EU law and, in particular, by Article 4 of the EU directive. Lord Justice Jacob in the Court of Appeal in the T-Mobile case in 2008 said that it,

“is inconceivable that Art. 4 in requiring an appeal which can duly take into account the merits, requires Member States to have in effect a fully equipped duplicate regulatory body waiting in the wings just for appeals. What is called for is an appeal body and no more, a body which can look into whether the regulator had got something material wrong”.

He also held that,

“there can be no doubt that just as JR was adapted because the Human Rights Act so required, so it can and must be adapted to comply with EU law and in particular Article 4 of the Directive”.

Indeed, in a more recent case involving judicial review and Article 4 in 2016, Mr Justice Cranston observed that, as the Competition Appeal Tribunal had said:

“Ofcom enjoys a margin of appreciation on issues which entail the exercise of its judgment”,


and that,

“the Tribunal should apply appropriate restraint”.

It is not a second-tier regulator, and the fact that it might have preferred to give different weight to various factors in the exercise of a regulatory judgment would not in itself provide a sufficient basis to set aside Ofcom’s determination. It should not interfere with Ofcom’s exercise of a judgment unless satisfied that it was wrong.

These are the relevant judicial review standards that will be applied in these circumstances. We do not want a complete retrial—if I can call it that—or a situation in which, at two levels, we begin at the beginning and end at the end with an entirely different opinion and approach to the evidence, and, perhaps, entirely new arguments being advanced evidentially in support of the merits of a case. That is a never-ending process and is not common to any other area of regulation by a public authority.

The judgments I have referred to have been considered in a number of subsequent cases and it is clear that a judicial review standard is consistent with the requirements of Article 4 of the framework directive. In these circumstances, it is not considered that there is any real need for this amendment. It is appropriate that we proceed with Clause 80 and I therefore invite the noble Lord to withdraw the amendment.