Enterprise Bill [HL]

Debate between Lord O'Neill of Clackmannan and Lord Stoneham of Droxford

Tuesday 15th December 2015 Lords Chamber

[Lord Stoneham of Droxford (LD)]

My Lords, I do not wish to detain the House, but I must join in the thanks to those on the Bill team for their patience, particularly on the Green Investment Bank, and all colleagues who have taken part on the Bill. I also join in thanking the Minister for her understanding, diligence, very good communications and patience throughout our proceedings.

[Lord O'Neill of Clackmannan (Lab)]

I thank the noble Baroness for not putting something in the Bill. At one stage, the noble Lord, Lord Aberdare, and I supported an amendment concerning the issue of retention and the means of dealing with it. She told us that, if it were withdrawn, she would undertake to establish a review. The manner in which the review has been set up gives us great confidence that it will be conducted in a rigorous and fair way, and we look forward to it proceeding in due course. I thank the noble Baroness not for putting something in the Bill, but for giving us what I hope will be an adequate substitute as a means to address one of the most vexed issues of payment. It was not covered by the Bill, but will now be within sight of being properly and speedily remedied—many years too late, sadly, but now ready to be dealt with in an effective manner.

Enterprise Bill [HL]

Debate between Lord O'Neill of Clackmannan and Lord Stoneham of Droxford

Wednesday 28th October 2015 Grand Committee

[Lord Stoneham of Droxford]

I shall also speak to Amendment 26. Amendment 25 is another amendment on the same theme that we have already been discussing: whether the commissioner needs some extra power. The two amendments would principally ensure that a report is published if an inquiry is entered into and that the respondents should be identified.

The reason for putting this proposal forward is that we are again seeking more effective powers and oomph for the Small Business Commissioner. We are assuming that if the complaints scheme is entered into, there will be a period before the initial approach is made for some sort of opportunity for conciliation. Indeed, I would have thought that most issues should be encouraged towards resolution before going into any kind of formal complaints scheme or procedure. As I say, there should be an opportunity for conciliation. To encourage that process and to provide an incentive to settle matters quickly and informally, some pressure should be applied. Once we have entered into the formal complaints scheme or procedure, a report would then be published and the respondent would be named.

The respondent may fear that they would attract unwanted publicity if matters were published in this way, but if the respondent has no concerns that they have done anything wrong and there is nothing they need to put right, they should have no anxiety about this, and that could be another way of applying pressure to get something resolved.

There is one further element to these amendments. There may be examples where the commissioner finds that a particular respondent is using undue pressure arising from its position in the marketplace and, indeed, is benefiting from undue dominance. We think the Bill should state that the commissioner should have the power to notify the Competition and Markets Authority where he or she considers that there is an abuse of market power, so that is an additional power which we are seeking through these amendments. I beg to move.

[Lord O’Neill of Clackmannan]

This group of amendments is significant, in so far as it is another indication of the change of mindset in the Liberal Democrat ranks. We have seen them voting with enthusiasm against the Government in the past few days, and here we have what must be regarded as a classic example of Opposition Committee stage amendments. Where you see a “must” you make it a “may” and where you see a “shall” you make it a “will”. I remember some 35 or more years ago as a young Back Bencher being told that that is what I had to do when I was debating the Committee stage of a Bill in order to scrutinise it properly, but in effect the idea was really to hold up proceedings for as long as possible. That was because in those days, time was the only weapon in the Commons that Oppositions had. I am sure that the noble Lord, Lord Cope, bears the scars of many such confrontations.

This is a basic type of amendment but it is none the less worthy because of that. It offers to put teeth into the legislation, and I think it is useful for us to get a greater degree of accountability—a bit of an edge. As I said earlier, the softly-softly approach is okay, but it should be, “Walk quietly, but carry a big stick”. The stick does not have to be used, but the threat is there. The Minister recognises that here is an opportunity to have a bit of cross-Committee co-operation, and may accept what is a modest but none the less worthwhile group of amendments.

I hope that I do not sound patronising, but this has brought back to me memories of the delights of the Augean stables of Scottish secondary legislation, on which I spent many years. I will not sustain the metaphor, but noble Lords will get my point. As I say, the amendments deserve the support of the Committee, because they are well-intentioned and should enhance and give more force to the Bill.

Enterprise Bill [HL]

Debate between Lord O'Neill of Clackmannan and Lord Stoneham of Droxford

Monday 26th October 2015 Grand Committee

[Lord O'Neill of Clackmannan (Lab)]

My Lords, the Minister has had a distinguished record in public service and in the private sector. I imagine that in both of those areas she has had responsibility for the appointment of people to significant positions. As my noble friend Lord Mendelsohn was going through the amendments, I thought about what kind of person we will have as the Small Business Commissioner. The commissioner will be someone whose terms of reference are quite clear. He will be the creature—the satrap—of the Secretary of State. He will be appointed by that Secretary of State with little security of employment. He will be capable of being thrown out at the whim of the Minister. He will have little or no say over the appointment of the staff who will be working under him or her. I am sorry if I slipped into sexist language and assumed that the individual would be a man. I should have thought that a woman would be too sensible to do the job.

The truth of the matter is that this is a bit of a non-job. For it to masquerade as the defender of business, without an iota of independence of the Minister, means that the commission is, in effect, a state-run citizens advice bureau for businesspeople. Unless the salary is fabulous and the hours and conditions are not very onerous, there is not much incentive to take this job. Frankly, one would immediately ask questions of anybody who took the job in the first place.

It is for all of those reasons that the amendments tabled by my noble friend would make this appointment worth while. It would afford the business community a sense of confidence. A small business that has problems with payment and other concerns about administration will find that this place-person is in a job that affords the small business little or no protection and little or no opportunities for redress of an independent character. At the end of the day the operation of this office will be subject to the most minimal scrutiny and the reports will be given not to Parliament but to the Secretary of State alone, which leaves one with grave concerns.

I return to my original point. If the Minister were working for Tesco and it was going to appoint a customer ombudsperson on the basis that he would be hired or fired at the whim of the Tesco management and that reports would not be subject to public scrutiny—not necessarily by all the account holders of that company, but perhaps by the people who work in trading standards offices in local government, for example, who make it their job to protect the customers’ interests—would the public have any confidence in a person of that kind? I doubt it. I doubt whether any business establishing a position of this kind would have the nerve to present it in this way. Frankly, it is not worth a light. One can have no confidence in the appointment of this nature under the terms of reference that the Government envisage. They are missing out a tremendous opportunity and bringing the appointment into disrepute by the manner in which it is being presented and the terms of reference under which the individual to be appointed would have to operate.

At this early stage in the Bill, and given the significance of this appointment, we are missing an opportunity which would be filled by the amendments which my noble friend has just introduced, with which I am happy to be associated.

[Lord Stoneham of Droxford (LD)]

I support what the speakers so far have said, particularly the noble Lord, Lord O’Neill. This is an issue of confidence. Either the Government have confidence in this appointment and are prepared to give it powers and independence or we must ask whether it is really worth having it.

We will be raising this later, but if the powers of intervention are to be limited simply to other businesses rather than to look also at the role of public authorities, it is understandable why the Government are trying to circumscribe the position. Under other amendments, we will look at whether the commissioner should have a wider role. Nobody will say that other public authorities are not just as bad at times in dealing with their suppliers as some parts of the private sector. We must ask why they should not be included. If that is the case, the position clearly needs greater independence, rather than being responsible simply to the Secretary of State. For all those reasons, I very much support the amendments.

--- Later in debate ---

[Lord Stoneham of Droxford]

I will speak to Amendment 41. Our concern throughout has been that the powers of the commissioner are somewhat ineffective. There is a danger that, as a result—this is our fear—he or she may well be side-lined because there are ineffective follow-up powers to deliver on his work. If we are to deal with some of the abuse of late payments, there must be some clout coming down the line.

I accept that the noble Baroness may tell us that it is best to wait and see before we come forward with legislation in future, but here, we provide that, subject to the commissioner’s advice, the Secretary of State may consider regulations which would give power, as necessary, to fine late payers who are not complying with the advice they receive from the Small Business Commissioner to resolve complaints. This amendment, which again includes the public sector, could set definitions of good practice and follow them up with some penalty if they are not complied with. The Minister should consider that in the Bill, so that people see that the commissioner will not be ineffective and side-lined in future.

[Lord O’Neill of Clackmannan]

My Lords, I am very pleased to come in on this point. The problems of small businesses can very often be summed up as that they spend a lot of time financing bigger businesses. They do so because they are not getting paid and the bigger businesses have the money which they should have been paying further down the supply chain. We all recognise that this is an issue and, in some respects, the establishment of the Small Business Commissioner is evidence of that. However, it is equally significant that we have got to give the commissioner a chance from the very start. He has powers and teeth and he has support. Big businesses will not be allowed to set aside their responsibilities in respect of payment. This group of amendments covers both public and private sectors. In many instances, we have supply chains where the initial payment for work done comes from the public sector but there are many casualties going down the chain. The 30-day rule may be applied by some, but not by all. We do not need to wait on the commissioner asking for powers. We need to be able to say that this is the arena in which you will be operating and these are the powers and weapons you will have with which to take on the recalcitrants.

The amendments are a bit imperfect at the moment, but the principle is there. It is up to the Minister to come to us and say that the Government think, like noble Lords on this side of the Room, that something needs to be done. If this is not adequate, then by all means let us look at it again at subsequent stages, and in the other House, if necessary. Without this kind of clear backdrop, the Small Business Commissioner will be disadvantaged and will not be able to make the significant take-off, in respect of payments, that everyone would like to see right from the word go.