Enterprise and Regulatory Reform Bill

Lord Whitty Excerpts

Thursday 31st January 2013 Grand Committee

[Viscount Younger of Leckie]

My Lords, I welcome the general support given to Midata by the noble Baroness, Lady Hayter, in her initial remarks. I listened carefully to the large number of points that she raised. She has clearly put a lot of thought into the issue and I would like to address as many of the concerns that she raised as possible. It may well be that I do not cover them all, in which case, I will write to her.

The first issue I want to address is the point that the noble Baroness, Lady Hayter, raised concerning the British Retail Consortium and the objections that they have expressed on Midata. To re-emphasise the point—the focus of the power of this Bill are the four core sectors of energy, mobile phones, current accounts and credit cards. We cannot say that there will never be circumstances where Ministers believe including supermarkets within the regulations is worthwhile. But, before they do so, they will have to take account of the factors set out in proposed subsection (7) in Amendment 58C. The relevant legislation to effect such a change would be subject to enhanced parliamentary scrutiny through the affirmative procedure.

The noble Baroness, Lady Hayter, asked whether it was true that consumer bodies had been warning about the risk of this programme for some time. It is true that the Government continue to work with consumer representative groups and business to tackle any potential risks to consumers—the point that she raised. A range of consumer bodies endorsed the principles of Midata published by the Government in 2011, such as Citizens Advice, Consumer Focus and the Office of Fair Trading. Members of these consumer organisations also sit on the Midata strategy board, which is responsible for driving the direction of the overall programme. However, the Government are taking these concerns seriously and the Department for Business, Innovation and Skills will continue to work closely with consumer groups to ensure that consumer privacy is protected.

The noble Baroness, Lady Hayter, asked whether the Information Commissioner actually wanted the role of enforcement. I can reassure her that Ministers have discussed this with him directly and he was, indeed, willing to take on the role. The noble Baroness also asked if this was an appropriate role for the Information Commissioner and whether he had enough resources to undertake this particular role. We have had detailed discussions with the ICO on how the enforcement regime could work for Midata. If regulations are brought forward in the future, we are confident that the ICO’s existing expertise in data protection will help it to effectively enforce the Midata right for consumers. In addition, we did not want to place any additional cost burden on business, but we have included provisions enabling other bodies to be designated as enforcers, if that is later decided to be more appropriate than the ICO. For example, if we were to regulate for one sector only, it might be appropriate to designate a particular sector regulator.

The noble Baroness raised the issue of data protection. Existing consumer protections would still apply under Midata. All organisations that process personal data in the UK, including for the purposes of the Midata initiative, must comply with the Data Protection Act’s eight data protection principles. The DPA is enforced by the independent Information Commissioner’s Office, which has powers of prosecution and can issue monetary penalty notices requiring organisations to pay up to £500,000 for serious breaches of the DPA.

The noble Baroness also raised the issue of exclusions for smaller companies. I mentioned earlier that she will remember the issue of micro-businesses. The power allows flexibility for smaller companies to be excluded at the regulation stage. I hope that reassures the noble Baroness on that particular point.

The noble Baroness, Lady Hayter, also raised the issue as to whether consumers would be charged. The regulations could allow for consumers to be charged if that is considered appropriate at that particular stage. The new clause already limits such charges to the cost of complying with the request for data.

There are two more questions raised by the noble Baroness. First, she asked why there has been no government lead on providing public sector data. These measures will not apply to the public sector. However, in parallel, the Government are looking at issues of public sector data. The Open Data White Paper sets out the Government’s position and plans on public sector data release.

The noble Baroness also asked what form the regulations would take. The Government want first and foremost to encourage voluntary progress on this particular Midata programme. If regulations are subsequently brought forward, they will be shaped by consultations with stakeholders first.

The Government will continue to engage with business, consumer groups, regulators and trade bodies involved in the voluntary programme to accelerate progress as well as to broaden our engagement with other sectors. In bringing forward these amendments, we are conscious that a balance needs to be struck between the rights of individuals, the costs to businesses and wider benefits to the economy. This balance also needs to reflect the digital age and the increasing amount of data that is now unavoidably available.

We believe that giving consumers the right to obtain their own transaction and consumption data in portable electronic format, thus enabling them to use tools to manage this information in a smart way, is an effective way to empower consumers in the 21st century, which is good for business and good for the economy.

[Lord Whitty]

It seems to me that the Minister was talking about charging by the current owner of the information, or provider—the person with whom you are dealing through your mobile phone company. But I understand that the Government envisage there being new intermediaries in this area that will obviously be looking for a profit out of it for themselves and to use that data in different ways. Would that restriction on charging apply to them? In a sense, you have doubled the administrative time with a provider and an organisation that is being subcontracted by that provider to deal with the consumer. It also complicates data protection and potential liability and redress.

[Viscount Younger of Leckie]

The noble Lord, Lord Whitty, makes an interesting point. I will need to double check and revert to him to clarify his point.

--- Later in debate ---

[Viscount Younger of Leckie]

My Lords, given that this is the last group of amendments in our Committee discussions, I would like to place on record my thanks to our Deputy Chairmen and the clerks who have masterfully steered our way through all the amendments; to the Bill teams involved; to the Hansard writers who have admirably recorded our discussions and, indeed, were obliged to stay somewhat later than the extended time allotted last week; and to the Doorkeepers for their unstinting assistance.

We have given the Bill careful and detailed scrutiny and I pay tribute to noble Lords opposite as well as my noble friends who have participated in our debates. Although there have been areas on which we have not wholly agreed, which we will discuss further on Report, as one would expect from this House, they have brought a depth of knowledge and analysis to the wide range of issues covered by the Bill. I would also like to thank my noble friend Lady Stowell for the part she has played and my noble friend Lord Popat and many other noble friends who have assisted and supported me and my officials.

The Government’s amendments to Clause 79 have two effects. The first is to commence all powers to make subordinate legislation by statutory instrument on Royal Assent. This is to assist with the orderly commencement of the Bill’s provisions. I should make it clear that these amendments should not be seen as suggesting that all the powers in the Bill will be exercised straight after Royal Assent, or indeed at all. Some are reserve powers which will be needed only if certain circumstances apply—for example, Clause 45 on the powers of sector regulators. Amendment 60AD adds further provisions to the list in Clause 79(2) which are to come into force automatically two months after Royal Assent without the need for a commencement order. I beg to move Amendment 60AA.

[Lord Whitty]

My Lords, it is probably totally inappropriate for me—as I am probably the person who has been here least in recent days—but I would like to join the Minister in thanking the clerks, the support staff and everybody who has participated on all sides during these debates. I also thank the various Chairs, including our current Chair. I extend that to the Minister and his colleagues and to the noble Lord, Lord Marland, who, many moons ago, started us out on this course.

Lest the Minister think he is going to get away after that, I have a couple of questions on this virtually final clause. As he says, the powers do not necessarily come in at the first date that is stipulated here in terms of implementation, but the Secretary of State will be able to implement them. In Amendment 60AB, he has already referred to proposed new paragraph (b), which relates to concurrent powers in Clause 45. The Minister may recall that during the debate on this there was considerable concern expressed about how the balance between the sector regulator and the new CMA would work. My understanding is that there will be different times in practice when each of the concurrent powers cease or are otherwise redefined; does that mean that, as it stands, Clause 45 would come in all at once on whatever date the Secretary of State determined after the first date? In fact, there may be a different date for Ofcom and the CMA or Ofgem and the CMA or the other sector regulators. It would be heavy work for the Government if they were all to come in at the same time, because there are different considerations in each of the sectors and there will be some inquiries which are still ongoing and some which need to be completed. In any case, we will probably have to return to the substantive issue on Report to get further clarification—if not to move further amendments—but it would seem that if all of Clause 45 were brought in applying to all sectors at the same time, it would be a problem.

My second point is about proposed new paragraph (f) in Amendment 60AB. This effectively says that anything that does not happen to be listed here can nevertheless come into play on the first day after Royal Assent. It seems, since Her Majesty will be signing them off, that this is getting fairly close to his late Majesty, King Henry VIII, in that if you do not specify the date in which various sections come into operation, then bringing any Section forward to an immediate date—even though it is not specified in this commencement clause—could seriously disturb the arrangements of the particular bodies that apply. For example, if there is a commencement of a particular power to either commence or cease, people need to know that in advance. Therefore, it is important that the Bill specifies that rather than have a catch-all ability for the Secretary of State, or some future Secretary of State, to bring any clause into play on the first day. If the noble Viscount tells me that this is normal, of course I shall withdraw it, but it is not something that I see in many pieces of legislation. Perhaps he could clarify the position.