Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Bill

Viscount Younger of Leckie Excerpts
Tuesday 21st January 2014

(10 years, 11 months ago)

Lords Chamber
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Viscount Younger of Leckie Portrait The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Viscount Younger of Leckie) (Con)
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My Lords, first, I take this opportunity to thank all noble Lords who have provided thoughtful and constructive contributions to debate throughout the passage of Part 3 of the Bill. I personally understand how sensitive many of these issues—some of which the noble Lord, Lord Monks, has iterated just now—are to some noble Lords. In particular, but by no means exclusively, I thank the noble Lord, Lord Stevenson of Balmacara, for his kind words earlier; the noble Lords, Lord Monks, Lord Whitty, Lord Beecham and Lord Lea of Crondall; and the noble Baronesses, Lady Donaghy, Lady Turner and Lady Drake. I also thank my noble friends Lord Tyler and Lord Balfe and, in particular, my noble friend Lord Cormack, whose brief contribution I failed to acknowledge on Report. Finally, I give my sincere thanks to the Bill team for all their hard work.

I know that the intention behind the amendment of the noble Lord, Lord Stevenson, is to probe the Government’s plans for commencement of Part 3 and to ensure that trade unions are given sufficient time to be able to comply with changes requiring them to report annually on their membership registers. On Report, I offered to meet the noble Lords, Lord Stevenson and Lord Monks, to discuss this matter in more detail. Indeed, as they alluded to, that meeting took place two days following Report, on 15 January. Noble Lords may like to be reminded that, on Report, I suggested that the earliest the provisions would be commenced was October 2014. I am pleased that I was able to say at the meeting last week, and can confirm to the House today, that commencement will not occur before April 2015. This follows careful consideration of what has been said during the parliamentary stages and concerns raised during the BIS consultation, as well as discussions between the Secretary of State for Business, Innovation and Skills and Frances O’Grady, the general secretary of the TUC.

Commencement in April 2015 would mean that the very earliest any trade union would be required to submit a membership audit certificate to the certification officer would be August 2016. In practice, it is likely to be later than that for many unions, as many have a calendar reporting year and would not be required to submit their first certificate until June 2017. Noble Lords will recall that this is because unions will submit a membership audit certificate for the first full reporting year after the changes become law. The 17-month period that I referred to on Report is a combination of the union’s 12-month reporting period and the five months that is allowed after that period to submit the annual return.

I hope that this thoroughly reassures noble Lords as, in the meeting that I had with the noble Lords, Lord Stevenson and Lord Monks, I was led to believe that the reassurances that I personally gave were accepted. However, we will continue to work closely with trade unions as we head towards commencement, in particular by discussing with them the guidance that will be needed as well as consulting on the draft order that identifies eligibility to be an assurer. I believe that an April 2015 commencement date will give trade unions the time that they need to prepare and to amend their rules, and understand that the general secretary of the TUC agreed that this was achievable. I have written to the noble Lords, Lord Stevenson and Lord Monks, and placed copies in the Libraries of both Houses confirming this. The Secretary of State has written in similar terms to Frances O’Grady. I hope therefore that the noble Lord is reassured and that he will withdraw his amendment.

Lord Stevenson of Balmacara Portrait Lord Stevenson of Balmacara
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My Lords, I thank the Minister for his very full response to our amendment. I am obviously sad that he will not accept the amendment as laid, as it seems to exactly mirror what he has announced, but maybe these are days when the Government do not want to see too many concessions being scored, so I understand the problems. Assuming that what he has said is exactly what we think it is, and given that we have letters and documentation to support that and that letters are also being written separately to the TUC confirming it, I beg leave to withdraw the amendment.

Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Bill

Viscount Younger of Leckie Excerpts
Monday 13th January 2014

(10 years, 11 months ago)

Lords Chamber
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Lord Stevenson of Balmacara Portrait Lord Stevenson of Balmacara (Lab)
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I declare an interest as a retired member of a large union. As the noble Baroness has just said, it is common ground that the unions in Britain play a significant part in the modern economy. They should be cherished, not castigated. As has been mentioned, if the Government had brought forward such a burdensome set of duties on any other section of civil society, there would have been an outcry. Well, there is an outcry and the Government should listen.

For many employees, their membership or lack of membership of a trade union is a private choice, and one which they desire to keep confidential for what may be very legitimate reasons. The knowledge that under these new powers, trade unions could be required to provide their membership register to a government-approved official for “good reason” may act as a disincentive for workers to join unions, particularly in light of the current concern over union blacklisting. As my noble friend Lord Monks said, the Government are introducing this series of measures at the same time as the full extent of the scandal of blacklisting in the construction industry is gradually coming to light. This is by no means the only industry in which members of a union may wish to keep their membership confidential for fear of being subject to discrimination.

These measures clearly go beyond what is necessary and they are certainly not proportionate if they are to achieve any legitimate aim behind the proposals, if indeed there is one.

Viscount Younger of Leckie Portrait Viscount Younger of Leckie (Con)
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Before I address the amendments I would like to say a few words about blacklisting, which was raised by the noble Lords, Lord Monks and Lord Morris, and my noble friend Lady Williams, because at each stage of this Bill we have sought to emphasise how seriously this Government take any allegations of blacklisting. The Trade Union and Labour Relations (Consolidation) Act 1992 makes it unlawful to refuse to employ a person because they are a member or not a member of a trade union or because they refuse to join or leave a trade union. This position was strengthened in 2010, when in response to the Consulting Association blacklist uncovered in 2009, the Government introduced anti-blacklisting regulations and increased the penalties for unlawful processing of data. Data controllers can now be fined up to £500,000 for serious offences. There have been several allegations of new evidence of blacklisting to date, but no evidence of this practice recurring. The Scottish Affairs Select Committee and Information Commissioner are both currently investigating the potential for ongoing offences, and the Government continue to take a close interest in this issue. Therefore, the provisions that we are considering today do not increase the risk of blacklisting, because of the protections in place around the treatment of membership data.

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Lord Stevenson of Balmacara Portrait Lord Stevenson of Balmacara
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My Lords, it is interesting that the questions we are left with keep coming back and keep being unanswered. What is the serious public policy issue behind this proposal? What exactly is the problem? What will this Bill achieve that current legislation does not achieve? Will the measures being proposed do more than simply increase the regulatory burdens on trade unions? We have all those questions and very few answers.

We know that union membership is already regulated by the Trade Union and Labour Relations (Consolidation) Act. Section 24(1) puts a duty on unions to maintain an up-to-date register of members’ names and addresses so far as reasonably practicable. This legislation has stood the test of time since the days of Mrs Thatcher. As has been said already, we are not aware of any calls having been made to the Government to extend this provision. BIS, the certification officer and ACAS have confirmed under freedom of information requests that they have received no representations for such a measure.

As my noble friend Lord Whitty said, it may be that a better self-certification system could be an advantage. I say “it may be” because we do not know what the problem is but cloaking the issue in some spurious idea that there is some public concern out there that would be remedied by having an additional checking arrangement is simply not sufficient.

Viscount Younger of Leckie Portrait Viscount Younger of Leckie
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My Lords, I turn to two amendments which seek to drastically reduce the effect and extent of the provisions as drafted. This would in practice undermine the Government’s key policy objective, which is to introduce a proportionate and effective reporting and enforcement mechanism alongside the existing duty of unions to maintain an up-to-date membership register so far as is reasonably practicable.

Amendment 29 would remove Clause 37 and the role of the independent assurer from the Bill altogether. Clause 37 gives credibility to the assurance process by requiring independent scrutiny, which is in line with the Government’s overarching aim to provide greater assurance of the maintenance of trade union membership registers for the benefit of members, employers and, importantly, the wider public. As some unions become large organisations representing members across a variety of employers and workplaces, their administrative requirements become more complex. As a consequence of the prevalence of very large unions in recent years, there is also now an increased public perception of a union’s scope of influence.

This may be an appropriate moment for me to restate what I said in Committee: I am not minded to comment on the media coverage of particular industrial disputes, such as the Grangemouth refinery or, more recently, the issue affecting Howdens. Instead, as I should, I will focus on the separate issue at hand relating to the obligation of unions to maintain up-to-date membership registers. Perhaps this can also be described as playing a straight bat. I hope so.

The nature of union membership data means that they decay easily—for example, addresses can quickly become out of date. About 2 million people move in and out of union membership every year, which equates to around one in four union members. The register for a union which has a 25% turnover in membership could theoretically be entirely out of date in four years. Unions are already required by statute to maintain a register of the names and addresses of their members. What we are introducing is annual reporting on the compliance of unions with this duty where currently there is none. I believe—

Lord Lea of Crondall Portrait Lord Lea of Crondall
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I am most grateful to the Minister for giving way. This must be about the fourth time that he has said that, on the one hand, of course there is “churn”, as the word is now fashionably used, in trade union membership—20% or something like that. That is where I suggest the figure of 80% comes from; there is always churn going on. There is then a huge leap of logic, and the word “proportionate” in this context strikes me as astonishing. It is straight out of Alice in Wonderland—words mean what I say they mean, no more and no less. It cannot be proportionate to say that, because of churn, there is only 80% accuracy at any moment in time, therefore we will make it accurate by saying we will make it more accurate because we will have inspectors running around the country making it accurate. They will not make it accurate. In terms of what we have described as the problem with churn, how can they make it accurate? So the punishment will not fit the crime, even if there were a crime in the first place. Can the Minister give a more reasonable justification for an extraordinary lack of logic in his pronouncements?

Viscount Younger of Leckie Portrait Viscount Younger of Leckie
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My Lords, the reasoning behind this is simply to look at the bigger picture in relation to unions. The noble Lord, Lord Lea, needs to be reminded that unions with 10,000 members or fewer will be self-certificating. We are looking at those unions which have large membership lists. Many colleagues of the noble Lord—certainly in Committee—acknowledged that it is a challenge to keep membership lists up to date. This is why—in a very light-touch way—we are bringing in an assurer so that we can be sure that the lists are up to date, so far as is reasonably practicable.

I believe that the membership audit certificate will be credible for larger unions only if it is independent, and this is because larger unions often represent workers across a range of different job types and employers. They have complicated branch structures—I am sure that the noble Lord, Lord Lea, would agree with that. They often have different IT systems and there may be greater time delays for updating information. A union official or rep would not, therefore, have the same credibility as an independent expert in ensuring that the systems used across the entire union are fit for purpose. This is the essence of what we are aiming to do. That may also be helpful in response to the comments made by the noble Lord, Lord Whitty.

Clause 37 requires trade unions with more than 10,000 members to appoint a qualified, independent person, called an assurer, who has a duty to provide an annual membership audit certificate to the union. The membership audit certificate must state whether, in the opinion of the assurer, the union’s system—and please note this word “system”—for compiling and maintaining the register is satisfactory to comply with the duties in Section 24. This is analogous with the regime in place for financial reporting, where all unions are required to appoint an independent auditor to approve their accounts. An assurer has the right to access the membership register and other relevant documents at all reasonable times, and to require information and explanations from the union. This is necessary for the assurers to be able to meet their duties and carry out their functions. However, as I mentioned in a previous debate, they will be subject to the obligations of the Data Protection Act when handling union membership data.

The assurer may request access only to documents which may be relevant to the union’s duties in Section 24. At the outset, when the assurer is appointed, the union and the assurer could agree terms as to the relevant documents to which the assurer should have access. If, after making inquiries, the assurer’s opinion is that the union’s system for maintaining the register is not satisfactory, or the assurer is unable to obtain the information necessary to provide the certificate, they must state this on the certificate and give reasons for doing so. If the certificate is not satisfactory, the assurer is required to send it to the certification officer as soon as is reasonably practicable but after submitting it to the union. Again, as part of the contractual arrangements, it would be possible for the union and the assurer to agree that the assurer must alert the union of any possible issues before the certificate is finalised.

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Lord Monks Portrait Lord Monks
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I am grateful to the Minister for giving way. I just wonder how the assurer can help a union in a situation where there is very rapid labour turnover, lots of short-term contracts and great difficulty in keeping membership rolls up to date. What possible value can the assurer add to that situation, except to confuse it?

Viscount Younger of Leckie Portrait Viscount Younger of Leckie
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It is certainly not to confuse, my Lords. As I explained, the role of the assurer is to provide that element of credibility which is not there at present. The assurer will also be working closely with the union and a contract will be drawn up with the union, notwithstanding the core powers that the assurer must have. That is why we believe this is necessary, in particular for the larger unions with 10,000 members and above.

The current statute does not provide an assurance of the union’s compliance as there is no sufficient enforcement mechanism. The Bill addresses this shortcoming by allowing the certification officer to investigate instances of possible non-compliance where there is good reason to do so. The certification officer will require access to the register and other relevant documents in order to determine whether a union is diligent in maintaining a register that is up to date so far as is reasonably practicable. The current system relies on individual members making formal complaints to the certification officer before he can investigate. As members can have no way of knowing the state of the register as a whole, the route for the certification officer to determine whether a union is compliant with its statutory obligations is not that effective to ensure that the existing duties are complied with. There may be a good reason for the certification officer to investigate a union’s compliance with the overarching duties even in the absence of a complaint including, for example, where a membership audit certificate has not been provided by the union or it is unsatisfactory.

We want to give members and the wider public an assurance that all unions are complying with their existing statutory duties. If the measure is applied only when the certification officer receives a complaint, we will not achieve this objective. Just because there are few formal complaints that we are aware of, it does not mean that there is no problem and this is an important point to make bearing in mind the comments that were made earlier by the noble Lords, Lord Whitty and Lord Monks. The access to and handling of union data is a concern that has occupied a great deal of time and debate. The Government understand the sensitivity of union membership data and agree with the importance of protecting them. However, for the reasons discussed at length previously, I reassure noble Lords that this amendment is unnecessary. Membership data will be well protected by both the existing and new legal safeguards. The assurer will owe a contractual duty of confidentiality to the union as set out in the Bill. The assurer, the certification officer and the inspector will be subject to the obligations of the Data Protection Act whenever they handle union membership data. Furthermore, the certification officer is obliged to act in accordance with the European Convention on Human Rights, which includes the individual’s right to privacy.

These two amendments between them would undermine the Government’s policy objective in Part 3 of the Bill. Amendment 29 would remove the independent scrutiny that is fundamental to the credibility of large unions’ annual reporting on duties. Amendment 30 would remove the provision for the certification officer to proactively investigate and assess a union’s compliance with Section 24 of TULRCA where there is good reason to believe that there may be an issue. For these reasons I cannot accept the amendments.

Just before I ask the noble Lord, Lord Whitty, to withdraw his amendment, I want to respond to a question he put to me. He raised the important issue of who would be appointed to be an assurer. We have already said that we will consult on who will be eligible to be an assurer, and further to this consultation the Secretary of State will make an order setting out who is eligible. They are likely to be qualified professionals such as solicitors and lawyers, which was alluded to by the noble Lord, Lord Whitty, auditors or independent scrutineers. This is similar to the system in place for independent scrutineers, and furthermore the unions will have discretion over whom to appoint from the list of eligible assurers and to remove them from the role on agreement with their members. Unions will be able to define the detailed terms of contract and their relationship with the assurer. I ask the noble Lord to withdraw his amendment.

Lord Whitty Portrait Lord Whitty
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My Lords, I thank the Minister for that lengthy reply, in which he repeatedly referred to the Government’s key policy objective. However, it is not clear to me what the policy objective of the whole of Part 3 is, and in particular the invention of this new category of assurer. I am glad that there is to be a consultation on it, but I do not see that anything is likely to emerge at the end of that consultation which could not be written into the terms of the annual audited return from the trade unions, whereby the external auditor would be required to certify that their membership system complied with the requirements. Why we have to invent a whole new structure is creating grave suspicion among the unions. The whole of Part 3 is very difficult to understand, but its effect will be a significant cost on union administration. The creation of an intermediate level between them and the certification officer is bound to increase distrust, and there is a suspicion that the Government’s motive in this is, at the very least, suspect.

Some of the motives that we have to tried to impugn have been denied by the Minister. It is not about tightening up on strike ballots. It is not about assurances on internal elections. It is not about the political fund. It is about imposing a cost and a bureaucracy on trade unions that will increase the likelihood of conflict between them and their regulator. I do not think that that is in the interests of trade union members and I cannot see that it is in the interests of wider society. The suspicion therefore has to be that other, sinister motives are involved here—that the Government wish to impose someone right in the heart of the administration of the trade unions, someone employed or contracted theoretically by the trade unions but who is actually a different type of person. I do not want to go too far down the paranoid road but I am quite a long way down it.

It seems to me that all the objectives that the Minister has mentioned can be achieved by a tightening up of the audit and by the certification officer and his or her powers. This intrusion of an assurer has not been justified. Had we not been voting so much today and we are all getting very tired, I would have asked the opinion of the House. I think that this is a bad part of the Bill and this is the worst part of that bad part. Before they put it into operation, the Minister and the Government need to think about this very carefully again. In the mean time, I beg leave to withdraw the amendment.

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Lord Stevenson of Balmacara Portrait Lord Stevenson of Balmacara
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My Lords, I have never in my long life met a Conservative member of a trade union. It is very nice to be introduced to one and to hear him speak. It has been very evident from the speeches we have heard, both in this small debate and previously, that if the Bill is to progress and be brought into law it must operate with the best chance of success otherwise it will not have been worth a candle doing it. As my noble friend Lord Monks said in an earlier intervention, the right way to do this is to give the unions—particularly the larger unions—adequate time to comply with the Act in a way that is cost effective, economical and practical, but also from their point of view. Unions are, after all, independent self-governing bodies. As the noble Lord, Lord Balfe, said, they rightly have procedures for making complex changes in their constitutions and it will be necessary, as the Bill recognises, that the unions will make some changes through rules conferences and the like. This is not to say in any sense that there is not anything wrong with what is currently in the Bill, but I detect in some of the comments made that we are still not absolutely clear about how the procedures will operate and the timescales that will be on and that will interfere a little bit with transparency.

When he responded to this point in Committee, the Minister said that he shared the sentiment that,

“trade unions should be given sufficient time to prepare”,

and he hoped he could,

“offer a positive and emollient answer”,—[Official Report, 11/11/13; col. 596.]

to allow time for the bedding down of the new legislation. I take it from that that he is still interested in trying to make sure that this works well. Picking up on what has just been said, I get to 17 months from the comments that were made during Committee if I follow two tracks. The first is that a union whose reporting year ends on a fiscal basis—that is, 31 March—would not need to submit a report for the year ending 31 March until the end of August 2015, which I think is 17 months if I do my maths correctly. However, a union that reports on a calendar-year basis would have a little more time. It would not have to submit its report for the year ending 31 December 2015 until the end of May 2016.

That is the sort of level of complexity which we are operating on. If we are going to fit a 17-month period, which I think was mentioned earlier as being appropriate, combining it with a Royal Assent, possibly by March 2014, and a period of consultation on the question of how assurers are going to be both defined and appointed, that suggests that it would be sensible to have one further round of discussions before it is finalised. Will the Minister consider having a short meeting with me and a few colleagues to try to run over this so that we can get some absolute clarity on it? Thereafter, we can all work together, not in any sense to shake the principles which are part of this part of the Bill, but to make sure that they work effectively.

Viscount Younger of Leckie Portrait Viscount Younger of Leckie
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My Lords, Amendment 33A could delay commencement of the provisions in Part 3, as they would not come into effect until the certification officer knows that all trade unions with more than 10,000 members have changed their rules to provide for the appointment and removal of an assurer. I know that noble Lords have been concerned that unions should have sufficient time to prepare for these new arrangements. In particular, we have been told that many unions do not routinely have an opportunity to make rule changes—I think the noble Lord, Lord Monks, alluded to that earlier. I am happy to offer reassurance to the noble Lord, Lord Stevenson, and other noble Lords that unions will have the time that they need. They will have at least 17 months to comply from the point at which the legislation takes effect, because the provisions will not apply retrospectively.

Unions will be required to submit a membership audit certificate alongside their annual return for the first full reporting year after the changes become law. The 17 months is the combination of the 12-month reporting period plus the five months that is allowed after that period to submit the annual return. The earliest that the provisions will take effect is October this year, which would depend on Parliament granting Royal Assent next month. That being the case, unions would have a minimum of 25 months from Royal Assent. In practice, many unions will have much longer.

Unions have different reporting years: many work on either a calendar or a financial year, which the noble Lord, Lord Stevenson, mentioned. Were the legislation to take effect in October 2014, a union with a calendar reporting year would first provide the membership audit certificate by the end of May 2016; for a union with a financial reporting year, it would be the end of August 2016. The noble Lord, Lord Monks, raised the issue of allowing unions sufficient time to meet the new requirement. I entirely sympathise with that and have said something about it just now. I have to confess that this is not the most straightforward of timetables to set out and I would be very happy to meet the noble Lords, Lord Stevenson and Lord Monks, and any other noble Lords to clarify the timings and state why we think this would be sufficient for trade unions to make the transition. That reflects the discussions that we have had with the TUC and others.

I take this opportunity to warmly welcome the noble Lord, Lord Balfe, and the experience that he brings on union matters, something I mentioned earlier in respect of the noble Lord, Lord Monks; it is only fair to acknowledge the experience that the noble Lord, Lord Balfe, has as well. I have had some discussions with him, at his request, on the question of whether the £10,000 threshold is set at the right level. Our primary objective is to supply assurance to union members, and to the wider public, about the existing statutory requirement to maintain an up-to-date register of members. The requirement to maintain a register applies to all unions, no matter what size. However, at the same time, the Government do not want to unnecessarily prohibit the creation of trade unions or undermine their ability to operate. We believe that it is possible for a union to be confident in the accuracy of all its records where its membership is small. We also believe that the wider public will think it reasonable that special provision is made for the smaller union and accept that where numbers are smaller it is reasonable to rely on the union’s own assessment.

Self-certification means a union officer assuring that every individual record is up to date, so far as is reasonably practicable. We think that this is achievable for unions with 10,000 members or fewer, but it becomes much more challenging where there are more members than that, which was part of the debate that we had earlier. The union official would have to be confident of the position and union members and the wider public would have to have trust that this was reasonable—a point, again, that I made earlier. By contrast, independent assurance focuses on whether the system in place for monitoring records is satisfactory, as opposed to making a statement about the accuracy of individual records. I therefore believe that this amendment is unnecessary and I ask the noble Lord to withdraw it.

Lord Monks Portrait Lord Monks
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My Lords, it was a pleasure to hear the noble Lord, Lord Balfe. I welcome him to this House. It was a pleasure to hear him praising TASS, which, as its chosen acronym suggests, was not exactly aligned with the Conservative Party—nor, from time to time, with the Labour Party either. However, we all change and I am interested in what his views were when he was an active member of that union.

We appreciate the way in which the Minister responded on the timetable point. It will be useful to just see if we can tie this matter down in the next couple of weeks and see where the different positions that we hold meet, so that unions comply in a way which is sympathetic to the necessary costs and timetables. On that basis, I beg leave to withdraw the amendment.

Justice and Security Bill [HL]

Viscount Younger of Leckie Excerpts
Wednesday 21st November 2012

(12 years, 1 month ago)

Lords Chamber
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Baroness Kennedy of Shaws Portrait Baroness Kennedy of The Shaws
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Does the noble Baroness agree that—

Viscount Younger of Leckie Portrait Viscount Younger of Leckie
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My Lords, perhaps I may remind the House that the Companion sets out that, at Report stage, a speaker other than the mover of an amendment, a Minister or the noble Lord in charge of the Bill can speak twice only if granted the leave of the House, and then to explain a material point of his own speech that may have been misunderstood or misquoted.

Lord Reid of Cardowan Portrait Lord Reid of Cardowan
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I will give way but I was not quite finished. I have heard of being overtaken by events but I think that I was overtaken by Baronesses in the middle of my speech. I did give way to the noble Baroness, Lady Manningham-Buller.

I have said what I wanted to say, which was mainly to try to give to the debate a balance which I think is, perhaps wrongly, missing. We are discussing a justice and security Bill generally, and the actual analysis of the security elements of that seemed to be somewhat missing from our deliberations, both in this group of amendments and previously.