Deregulation Bill

Lord Mackay of Drumadoon Excerpts

Monday 7th July 2014 Lords Chamber

[Lord Mackay of Drumadoon (CB)]

My Lords, the two clauses in the Bill that I want to touch on briefly, Clauses 18 and 61, have caused the Law Society of Scotland some concern over their possible implication and consequences. It wishes these concerns to be raised at this stage of the Bill, but it may be necessary or appropriate to return to them in Committee.

Clause 18 seeks to alter the regime for insolvency practitioners by introducing a new regime of partial authorisation for an insolvency practitioner. Such a partial authorisation would entitle an individual to act in insolvency related only to companies or another individual to act in insolvency related to individuals. Full authorisation would be reserved for someone who was authorised to act in relation to companies, individuals and insolvent partnerships.

The Law Society of Scotland understands that, in England, the law relating to the insolvency of corporate bodies is separate from that relating to the insolvency of individuals. It is therefore easier to understand why one might want to split up the authority to act into a partial authorisation. On the other hand, in Scotland there is no such separation between the law applicable to corporate work and the law applicable to individuals. The Law Society’s concern is that many of the statutory instruments that are currently required to be followed by insolvency practitioners in Scotland could not be confined within a partial authorisation, as proposed in Clause 18.

It might be asked why the Law Society should be concerned about this, because the obvious solution might be that everyone in Scotland wishing to be an insolvency practitioner should just apply for full authorisation. However, it seems perfectly commendable that the Law Society’s concern should be drawn to the Government’s attention, to see whether this clause requires examination in a little more detail at later stages.

The other clause that has given rise to concern is Clause 61. This provides that Section 15A of the Social Security Act 1998, which deals with the functions of the Senior President of Tribunals, should be amended to omit the provisions that require preparing and publishing an annual report on standards of decision-making in certain decisions made by the Secretary of State, against which an appeal lies to the First-tier Tribunal. In other words, the Senior President of Tribunals has publicly to make an annual report on the view taken about the standards of decision-making, in certain decisions made by the Secretary of State and his or her staff.

The Explanatory Notes to the Bill state that arrangements have been put in place to compensate for consequences of removing this statutory duty on the Senior President of Tribunals. They go on to state:

“Alternative and more direct methods for providing feedback from the judiciary to the Secretary of State have in practice been developed”,

and been effective. Speaking as a judge for a number of years, I was unaware of any alternative and more direct method for providing feedback to the Secretary of State, other than issuing a judgment or opinion once a case was decided. Again, I suggest, the Law Society commendably considers that these alternative methods should be specified at this stage, before the Bill goes much further.

I do not expect the Minister to be in a position to comment in detail on these matters. The first is quite complicated and I have advised the Law Society that we should write to the Minister’s department for this to be considered fully. If there then has to be a debate on it at a later stage, all those taking part can be properly informed about the issues and arguments, one way or another.