Advanced Research and Invention Agency Bill

Lord Patten Excerpts

2nd reading
Tuesday 2nd November 2021 Lords Chamber

[Lord Patten (Con)]

My Lords, the general tone of this debate—one of overall welcome and support for the Bill, in reaction to what my noble friend said in his excellent introduction—was set, if I may say so, by the noble Viscount, Lord Stansgate. I listened most carefully to what he had to say in his entertaining, as well as perceptive, words. I enjoyed it very much, as I enjoyed what his father said a long time back when I was a new Tory MP on the green Benches in the other place, making my maiden speech back in 1979. When I sat down, the then right honourable Tony Benn MP stood up as the next speaker and said all those nice things that you say to a new boy or girl. Very welcome they were, and I thought, “That was very kind”, sat down and thought no more about it until, on the way to the station to go down to the constituency for the weekend, I got a slightly panicky message from my constituency party saying that there was trouble in the party about my maiden speech. I had been a Member of Parliament for only a moment or two and had no idea what I could have said that would have caused any trouble at all until I got off the platform at Oxford station and saw the billboards for the Oxford Times saying, “New Tory Member Makes Maiden Speech Praised by Tony Benn”.

That said, I have four quick points to make. First, I strongly support the Bill, all the more so because it is a manifesto commitment that has been carefully crafted and kept, which does not happen with all government legislation. Long may it become a habit, I say to my noble friend, that we keep our manifesto commitments.

My second remark is that we are setting up for the UK a novel blue-skies body. Everyone else has said this; they are quite right and I will not labour the point. It is right, however, that throughout, our national security, about which we all feel strongly, is protected. Hence the need, contained in the Bill, for ARIA to accept directions from the Secretary of State. I know that my noble friend the Minister said, in his introductory remarks to which I listened carefully and will hold him to, that that is where it would all stop, but the powers must stop sharp there. Ministers must never be allowed to seek to nudge, let alone give direction, to promote other parts of their political agenda. To make up a random example, they must not help the levelling-up agenda by putting something in some part of the country, totally randomly chosen, which might need a leg up.

My general message is “Hands off”, and I look forward to reaffirmation by my noble friend that that will indeed happen. “Hands off” was what got DARPA off to such a cracking start back in 1958. The US is very lucky to have been a leader here, and to have spawned from DARPA a good number of similarly great private sector companies, such as IBM and others.

I have known some of these pretty well, and there has been a bit of copycatting to a very successful degree. Take Boeing, the aerospace company: it has an outfit called Phantom Works, which no one dares, or is allowed, to get near. Or there is Lockheed Martin’s endearingly—indeed trademark—named Skunk Works, which is more difficult to get into than Fort Knox. I must declare my interest as, for some 12 years, I was an adviser and a non-executive director for Lockheed Martin Corporation and my shareholding continues to be declared because it is current in the Register of Members’ Interests. So I know this world a little bit, and I just wish that more UK companies had set up such DARPA-like bodies years ago.

Thirdly, the quality and imagination of the leadership of this new body will be absolutely critical. The noble Lord, Lord Davies of Brixton, was thinking about who might be served up to the Secretary of State and what might be in the Secretary of State’s mind. The noble Lord, Lord Patel, said in his admirable remarks that one of the most important things of all is getting the leadership right. We do not want to have a head hunt as they will be queuing up to earn an honest pound by producing lists of the same old—with respect—FRSs and Nobel Prize winners and the great and the good of the scientific world. We need them to find someone daring, free thinking and original, but of course, responsible, committed and scientifically knowledgeable.

Here I have no interest at all; I have never met, communicated or worked with her, but I think the now—happily—Dame Kate Bingham has just those qualities that some man or woman could well replicate. Some noble Lords will remember her transformation from zero to hero. When she was first given the job by HMG she was excoriated by the worst sort of commentariat and media people, and suddenly, six months later, she was a national hero. So I would like my noble friend the Minister to undertake to pass on my remarks to the Secretary of State in these terms: appoint sensible risk-takers, not referees.

Lastly, I strongly support the determination of the Government to keep the endless FOI regime from getting further and further into it, opening the door of a small, highly staffed and not hugely financially endowed body with the specific mission to risk failure to those tendentious inquiries and time-wasting journalistic fishing expeditions to get a story in which they can say that something has failed. We can all see that coming.

I greatly hope that the Bill is a success and I look forward to it passing. Who is to say, the work of ARIA might even help to solve one of the great mysteries of the day: why the UK continues to have such low levels of productivity.

Deregulation: Public Services and Health and Safety

Lord Patten Excerpts

Thursday 13th July 2017 Lords Chamber

[Lord Patten (Con)]

My Lords, I listened with great care and respect to the very interesting speech by the noble Baroness, Lady Andrews—as did, I am sure, the whole House—but I respectfully disagree with the impression that she gave that by definition all acts of deregulation are ideological. I am sure that is not the case—I do not believe it to be the case—for we cannot obliterate records or pretend that any party in recent decades has not wanted to get better regulation, including, from time to time, by getting rid of imperfect regulations.

The Labour litany is long, over the 13 years of their Government between 1997 and 2010, and all of it had some impact on regulatory enforcement in delivering public services on health and safety, the themes of the noble Baroness’s debate. There was the Better Regulation Taskforce and there were regulatory impact assessments falling over regulatory impact units and trying to avoid the Better Regulation Executive. The Labour Party was up to its neck in regulation and deregulation in those 13 years, and as a Minister the noble Baroness played her part in all of that.

In many ways, coalition and Conservative Governments since 2010 have been simply continuing the work that Labour started. I suspect that there is all-party agreement and consent to what my right honourable friend the Prime Minister said in this context as recently as 22 June in another place: namely, that,

“all regulation is not bad regulation; there is good regulation, which we need to ensure that we get right”.—[Official Report, Commons, 22/6/17; col. 189.]

However good, bad or unnecessary any regulations may be, the other key question, which has not thus far been discussed, is: are they always observed in the public sector and the private sector? We have human beings in positions of power in the public sector and the private sector interpreting and applying rules, or ignoring them if they think they are unnecessary or that they can get away with ignoring them. There are well-documented cases of that in the public sector as well as in the private sector.

There is also, alas, an increasing atmosphere among some in the delivery of public services. People are getting pretty fed up with their lot and what they are landed with and are verging sometimes on the sour in their dealings with the public. I can understand why— because under Governments of all colours since 2007, including the last Labour Administration, pay has barely risen. Despite huge increases in public expenditure on public services, money always seems to be tight for those delivering public services in the face of what is very often inexorable demand. Yet despite the growing burden of regulation felt by many in public service overall, in its figures last week the Office for National Statistics showed that the greatest productivity growth had been coming from the public service. Congratulations are due to public service workers who have delivered this massive increase in productivity. Of course, part of it comes from the reduction in the numbers in employment in the public sector doing the same job at a time when the UK has been creating jobs hand over fist—the envy of the rest of Europe.

All that said, I do believe in trusting front-line professionals as much as possible and allowing them to get on with the job in exactly the same way in public services as in business. An important-to-achieve end is making sure that regulations do not interfere with professionals in the public service improving their outcomes in the services for which they are responsible.

A very good example of the effectiveness of this approach is in education. The last Labour Government realised that teachers needed less regulation—more autonomy to raise standards—so they set up city academies where schools were underperforming. I applaud that, followed, as it has been, by the Conservative/Liberal Democrat coalition not only speeding up that process but jointly—the Liberal and Tory parties together—setting up free schools. A tiny touch of amnesia has come over the Liberal Party about its role in setting up free schools, but I am sure that the memory will come back with adequate help. All this has been duly monitored by rigorous Ofsted inspections to ensure high standards. In this and other areas there has been much more agreement than most politicians on either side of the House will agree—which is a pity, because by and large they do agree.

I think we are also just about to see the beginning of some great debate on the balance between less regulation meeting better conditions for the new growing flexible national workforce after the publication of the excellent and thought-provoking report by Matthew Taylor, once a No. 10 adviser to Tony Blair, whom our Prime Minister, Theresa May, has had the great good sense to appoint to conduct his review with its ground-breaking, standard-setting seven principles for fair and decent work, which I applaud—and not just in the private sector, or “gig economy”, as the press has termed it. Matthew Taylor also calls on public bodies of all sorts delivering public services to design jobs offering genuine flexibility, allowing some public sector workers to choose hours that suit them, and public sector managers to meet peaks and troughs in demand.

New regulations perhaps come into play more quickly than old ones are updated, as much in the public as the private sector. However, for sure in the area of the implementation of the Taylor report, new regulations will have to be continuously refined to test where exactly someone should be placed on the employment spectrum. All this comes at a time—as yesterday’s excellent employment figures showed—when unemployment has fallen to just 1.9 million, the lowest level since 1975, when Harold Wilson was Prime Minister. This is despite the threat of Brexit, as some media outlets insist on having it, because there has also been so much inward investment.

All who are in work in whatever sector will continue to need the shelter of good regulation, which I applaud, regularly reviewed and, if found wanting, revised. To be completely transparent—I have never met Mr Taylor, I would not recognise him if I saw him in the street, and I have never talked to him, but I think he has got the balance exquisitely right. He has been excoriated a bit by the trade unions and a tiny bit by some political parties and, on the other hand, a bit by business—but by and large he has got the balance spot on. However, implementing his recommendations will be more challenging.

That said, I strongly support the application of the “one in, two out”—or, as it now is, “one in, three out”—measure in effecting new regulation. I am also reflecting on something that my noble friend Lord Cavendish of Furness, who is unable to take part in our debate today because of duties he is following elsewhere, said to me on Tuesday. He said that the principle of “one in, two out” or “one in, three out” may well be of great help in dealing with one as yet largely unregulated sector delivering public services: that is, the seemingly unstoppable exponential growth in the spad population of this country.

My noble friend is quite right and I am glad that he reminded me of the spad terror. Indeed, there are even rumours that some senior spads are now seeking to have spads of their own to help them in their work. They are a completely unregulated body—the Civil Service pretends to regulate them but it does not—and I think that we are rapidly coming to the point when we need to have a new organisation called Ofspad to regulate these creatures in the undergrowth.

Several decades ago, there were just a few of them. Proper, grown-up spads are extremely necessary for Secretaries of State: they were demure, attentive and diplomatic, doing a helpful job in advice, speech-writing and sometimes murmuring in the margins interpretations of what the Secretary of State really meant during some Civil Service meeting. I know that one or two of my friends in the Chamber, both civil servants and politicians, have seen all this in action: “No, no, the Secretary of State was just exaggerating”, et cetera.

That is all very valuable, but no wonder today the Civil Service feels undervalued with the emergence of huge numbers of megaspads since the Blair era first promoted them, who see it as their job to promote internecine warfare between departments on too many occasions, which is totally counterproductive and a waste of public money, or to sit giving spurious murmured briefings over warm prosecco to the media about who is up and who is down in a particular department—putting themselves above civil servants. No wonder too many talented young men and women are thinking twice about going into the Civil Service. “Don’t put your son or daughter in the Civil Service, Mr or Mrs Whoever”, is pretty wise advice at the moment. So let a cull begin, on the one spad in, two spads out principle—I am a moderate man, as the House knows—and later on we can move, if that does not work, to the one spad in, three spads out principle to diminish this growing and unregulated industry.

There is a serious point here. Because of the way in which some spads have bossed about Ministers and taken powers on themselves, it is becoming a bit of a constitutional affront. They disturb the balance between civil servants and Ministers, whose constitutional roles are very well known and understood under our unwritten constitution, by interdigitating themselves in a way that is completely uncontrolled. I hope that on this, if nothing else during this debate, there may be some all-party agreement.

--- Later in debate ---

[Lord Tunnicliffe (Lab)]

My Lords, I too thank my noble friend Lady Andrews for introducing this debate and thank the many Peers who subsequently agreed with her opening speech—there was, of course, one notable exception. In a previous debate on these matters, I claimed to be the most regulated person in the House. I am sure that that is not true, but for 51 years I have been under the control of one regulator or another: the CAA when I was an airline pilot; the Railway Inspectorate and the fire brigade when I was running London Underground; the nuclear inspectorate when I was chairman of the UKAEA; and subsequently, the regulator on the railway system. In various cases, I have also been involved with financial regulation over perhaps the last 10 years. If there is a worst example of what happens when light-touch regulation gets out of hand, it has to be the financial crisis, and I am delighted by the way that both the Government and regulators have reacted to improve things. My enthusiasm for regulation, which will come out, was slightly blemished by the threat of prosecution by the Scottish Environment Protection Agency when my radioactive rabbits escaped, but apart from that, I believe that regulation is good for society and good for good business.

It is vital that we have the right level of government regulation to protect citizens, particularly the poorest and most vulnerable in society. Indeed, when it comes to public services and health and safety, as in finance and other sectors, the destructive effects of dogmatic deregulation have been plain to see and have been laid out very well in this debate. Many good examples have been provided, and I will add another, in the realm of transport. Outside of London, where public bus services have been deregulated since the 1980s, the number of trips has collapsed from 2 billion to 1 billion; in London, where TfL closely oversees transport services, we have seen the opposite, as the number of trips has risen from 1 billion to 2 billion since the 1980s.

If we accept that untrammelled markets can have negative impacts on society, then we accept the case for regulation. The next question is often framed in terms of extent: should we have more or less regulation? This is important to get right. We must have the right level of regulation to protect citizens in the face of highly complex and evolving markets. We must ensure that regulation stands in the shoes of consumers, making their world safe and fair in areas they cannot control for themselves. We certainly must not see deregulation as an end in itself. Less does not equal better.

Although we must not place undue or unnecessary pressures on business, we must not, as we too often hear from parts of the other side, dismiss all regulations as “burdensome red tape” and seek a minimalist approach. On that note, I would be grateful if the Government would confirm whether they support the view of the Red Tape Challenge initiative that EU regulation 305/2011, which aims to harmonise construction material quality across the EU, including external cladding, is a “red tape folly” which is “expensive and burdensome” for business.

Indeed there is a bigger question than whether we need more or less regulation, which has been touched on in the debate, about the quality of the regulation. Yes, we want the right level of regulation, but above all we want good regulation. Health and safety rules, at their core, are about saving lives. To be effective, they must be well evidenced. They must be flexible enough to deal with new techniques and new technologies. We are fortunate in this country to have the Health and Safety at Work etc. Act 1974, which has at its centre the requirement to reduce risk to as low as reasonably practicable. As far back as 1974, the importance of proportionality was understood—proportionality is the key to safety and good regulation.

Of course we must achieve a good balance between enabling businesses and the economy to grow on the one hand and protecting consumers on the other. Consumers are vulnerable if regulations do not exist, or are not monitored and enforced. Where we fall into a trap is when we see those aims in opposition. In reality they are complementary, and as far as possible government should work with business to design and enforce regulation. In this way, regulation can be both pro-business and pro-consumer—indeed, it must be. Although many noble Lords have pointed out the costs of deregulation to public services, we must equally point out the benefits of good regulation.

A sound regulatory framework depends on clear communication about the purpose and importance of the rules. This is no easy task, especially when many wish to undermine the case for regulation for their own purposes, but it has never been more important to make the case for good regulation and to rebuild trust in both government and business, which is at a record low. Part of the challenge is to inject more transparency, and clear lines of accountability, into our regulatory framework. One reason why so many feel powerless in their lives is the steady dilution of accountability. No one is ultimately held responsible, and no one knows who to turn to for redress. This is compounded by rules preventing proper scrutiny of private contractors who profit from public funds. A more accountable and transparent regulatory regime can play a crucial role in returning a sense of power and control to people’s lives.

Those who believe in the good that regulation can do must be especially vigilant in the context of Brexit and the powers proposed in the repeal Bill published today. As the Government aim to convert 40 years of EU regulation into UK law, it is vital that those regulations are made properly applicable and enforceable in the UK. I have not been reassured by a series of Written Answers provided by the Government to my noble friend Lady Hayter. There are 1,369 directly applicable EU regulations that apply just to consumer issues, 191 for health protection, 728 for transport, and many thousands more in related areas. Without converting these with proper scrutiny, we will be left with gaping holes in our regulatory system in many crucial areas that protect lives. Will the Minister update the House on how many of these directly applicable regulations have so far been redrafted so that they can be applied outside of EU membership? When may we see those redrafts?

My noble friend Lady Andrews rightly underlined the Red Tape Challenge, which ran until April 2013, and which the Government boldly estimated would make £10 billion in savings. I reiterate her call for the Minister to give an updated figure on how many regulations have been scrapped and what is the final total of savings calculated as a result of this measure. Further, I would value a categorical assurance that consumer, environmental and societal protection has not been diluted by these savings.

Most of the contributions from noble Lords were in support of the general theme that my noble friend Lady Andrews set out. I liked the openness with which my noble friend Lord Whitty agreed to be part of the nanny state. I am afraid that I cannot agree with the noble Lord, Lord Patten, that one in, three out—or whatever it is—makes any sense whatever. Bad regulations should be eliminated where there are risks in society—

[Lord Patten]

When I talked about one in and three out I was referring to my much-encouraged cull of spads in central government. As the noble Lord’s colleague recognises, we were having a little fun at the expense of spads. I was not discussing the general issue.

[Lord Tunnicliffe]

I am sorry if I misheard the noble Lord. I thought he was demanding one in and one or two out for regulations and had not realised that one in, three out was solely for human beings.

Other noble Lords made some important points. The noble Lord, Lord Stunell, touched on a concept that I have come across in my professional career, which is the idea of having clarity on who is responsible and on the duty of care. My noble friend Lady Young touched on the whole idea of principles. If the principles and themes are debated and got right, the regulation becomes sensible in itself. I liked the approach of the noble Lord, Lord Best, which in my professional career I have found true: getting the regulation right, and then firms and businesses applying it sensibly, means that you will get safer, better operations, and, in the long term, quality in safety and in the environment. Quality pays. My noble friend Lord Hunt touched on the fact that good companies like good regulation—they know the rules of the game and that regulations keep out the freeloaders. The noble Lord, Lord Smith, thoughtfully ran through the tremendously positive impacts that regulations have on the environment, which is extremely important. Like my noble friend Lady Crawley, I too regret that our better-regulation efforts have turned from better regulation to less regulation. It should be about better regulation.

My professional career has shown that regulation, in general, is not burdensome. In general, it requires management to be better and more effective; it makes the world safer, cleaner and fairer; and it means that good managers thrive and that those businesses are not only fairer and safer but more efficient—and, at the end of the day, more profitable.