Baroness Thornton
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Deregulation Bill
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Baroness Thornton (Lab)
My Lords, I agree with the noble Lord, Lord Deben: it rather looks as if the Government put a call-out to each department to offer up two or three regulations for abolition, without much thought about the priority and importance that they might have. I support the stand part debate on Clause 2. Indeed, I put my name to the intention to oppose it, introduced by the noble Lord, Lord Rooker, and supported by the noble Lord, Lord Sharkey. It seems hard to find anyone who supports the inclusion of this clause in the Bill, with the obvious exception of the noble Lord, Lord Curry, and Oliver Letwin.
As noble Lords have said, Clause 2 would remove the power of employment tribunals to issue wider recommendations to employers found to have unlawfully discriminated. I was party to passing that legislation in the Equality Act 2010. Indeed, on my side of the House, the Government of the time would have liked to have had some sanctions attached to this. However, there was a process of negotiation which the Conservative and Liberal Democrat parties agreed to. I make the point to the Committee that this is why we had that recommendation; it had all-party support from all parts of the House at the time.
The EHRC has said:
“We consider that the power to make wider recommendations is an effective way of preventing unlawful discrimination from occurring and helping employers to comply with their duties to treat their employees fairly. The case for … abolition has not been made. Clause 2 of the Deregulation Bill should therefore be removed”.
The Minister needs to explain to the Committee what is wrong with these recommendations. What is his message to the people who went through all the stress and trouble of going to an employment tribunal to right an injustice, as outlined by the noble Lord, Lord Sharkey, and other noble Lords, won there and then find that the employer is not being encouraged to do anything about those of their work colleagues suffering the same wrong? Does the Minister think that they should all go to the tribunal? What does he think should happen?
Finally, regarding the business perceptions referred to by the noble Lord, Lord Curry—it is the second or third time that he has mentioned them in these debates—I have to cite three cases. In Stone v Ramsay Health Care, the tribunal said that there was a “thorough and abject failure” by the employer,
“to have protected the claimant from pregnancy and maternity discrimination”.
It recommended training for senior managers and HR on pregnancy and maternity rights. In Crisp v Iceland Foods, the HR manager’s awareness of mental disability was “no less than woeful”, according to the tribunal. It recommended that those with HR responsibilities and area level managers be trained on disability discrimination rights. In Austin v Samuel Grant (North East) Ltd, the managing director had a long history of sending racist and sexist e-mails and the human resources manager had failed to deal properly with that issue. The tribunal recommended that the employer updated its policies on discrimination and that the directors and managers received diversity training. I cannot quite see what the overwhelming burden on industry is through those recommendations.
Lord Wallace of Saltaire
My Lords, this has been a useful and serious debate. I listened carefully to what the noble Lord, Lord Rooker, said, as he always does his homework extremely seriously—although the suggestion that you could find even a cigarette paper between the approaches which Oliver Letwin and I take to the Bill is one that I find quite remarkable. As a coalition Government, we are absolutely solid and arm in arm.
The noble Lord raised a number of serious questions. First, on the GEO inquiry, the 26 companies were of course under no obligation to reply; those that had the most interest replied. The GEO had taken the need to collect evidence seriously by contacting every employer at that time but there is also a question about the burden on industry and companies that one provides by pushing harder on those issues. Secondly, he raised the question of equal pay audits and how those are compared. As I think the noble Lord may know, an equal pay audit ordered by an employment tribunal is a precise and mandatory requirement, with sanctions for non-compliance, to advance equal pay in the small number of organisations where a breach of equal pay has been found. It is also directly a transparency measure, as it has to be published. By contrast, as has been stated in this debate, wider recommendations in other discrimination cases are effectively discretionary for employers and cannot be imposed.
On the question of how much evidence we have on all this, these wider recommendations have been handed down in fewer than 2% of all successful tribunal discrimination cases since 2010.
On the Red Tape Challenge, I say to the noble Lord, Lord Sharkey, that the presumption is that if the legislation does not serve a useful purpose then it should be removed. The fact that it is not terribly useful but confuses people as it stands is not a reason for leaving it on the statute book.
The noble Lord, Lord Ouseley, in a very helpful and powerful speech, raised the Howard case, which we are all well aware is one of the most difficult cases in this area. I should point out that the wider recommendation was intended for use in those cases where the complainant has left the relevant employer. In this case, as it happens, Miss Howard was still a Metropolitan Police employee, which would mean that the tribunal would still be able to make recommendations that benefited both her and her colleagues in the continuing workforce. Of course, even if Miss Howard had left the Metropolitan Police when the case was brought, it would remain open to the tribunal to express the same criticisms as observations in a non-statutory context.
What the Government are proposing will not result in any reduction in either the rights of complainants or the effective powers of tribunals, nor does it reduce the rights of other employees in the businesses concerned as the wider recommendation cannot be enforced on their behalf. Nevertheless, under the Red Tape Challenge the Government are committed to removing legislation that does not serve any clearly defined purpose, particularly where it none the less creates a perception of burden and unfairness. It is not just a question of those who, as the noble Lord, Lord Rooker, powerfully put it, have broken the law; we are concerned about the perceptions of unduly onerous legislative demands.
The power to make these wider comments, a somewhat anomalous one in a claimant-based adversarial system, came into effect four years ago. It has proved problematic. It is rarely used—we are aware of around 40 cases, as has been said, where they have been made—and trade organisations have told the Government that the power has led to additional cost, and that it is confusing.
Most of the wider recommendations made by tribunals are generic. Of the 40 or so that we are aware of, over 90% concern training for management or the updating of company diversity policies. However, as I have said, tribunals do not have the power to enforce such recommendations. Post-tribunal action is largely taken voluntarily by employers that have lost a discrimination case. Unless it was a one-off incident, business sense would drive changes in workplace practices to avoid a similar case being brought against them in future.
Perhaps I can give a few numbers in the areas that the noble Lord, Lord Rooker, raised. In 2012-13, the Government Equalities Office partnered the British Chamber of Commerce in events across the country, explaining the Act to small businesses. Around 300 businesses attended the events, and a follow-up booklet, Business is Good for Equality, was more widely distributed by regional chambers to their members, which altogether employ around 5 million people. Some 300 businesses attended the 10 short sessions to learn first hand about their obligations under equality law; that is more than seven times the number of employers that have received a wider recommendation in the four years since 2010. I hope that that provides some more detail of the sort that the noble Lord was asking for.
I know that concerns have been expressed that this repeal will reduce protections against discrimination in the workplace. That is not the Government’s intention and it will not be a result of this reform. Tribunals will continue to have the power to make recommendations and observations on their behalf. The question is: has this power done its job? I would say that for the employer, the wider workforce and the business in general, the answer is that it has not. There is instead a very small and unenforceable benefit balanced against the larger cost and the problem of uncertainty for business. I therefore urge that this clause remain part of the Bill.
Baroness Thornton
Baroness Thornton (Lab)
My Lords, it is important that I say from the outset that these Benches are not opposed to these amendments to remove the anomaly that currently exists in law which provides turban-wearing Sikhs with an exemption from having to wear safety helmets on construction sites but not in other workplaces. This is a probing amendment.
Noble Lords will know that keeping uncut hair and wearing a turban are an integral and mandatory part of the Sikh faith. Both male and female Sikhs wear turbans, and it is an integral part of the body to devout Sikhs, who will not wear anything in place of, under or over it, such as a cap or a hat. The compulsory wearing of turbans for Sikhs is a unique aspect not only of their faith but of their racial and cultural identity. I thank the Sikh Council UK for discussing this matter.
There are some remaining issues that I would like the Minister to address, although he does not have to answer them right now. I would be very happy to have these questions answered in writing and with a meeting, but I think that there are some quite serious issues. What is the reason for excluding the Armed Forces and emergency services from the provisions exempting turban-wearing Sikhs from having to wear their safety helmets? I remind the House of the role that the Sikh community played in both world wars; if you look at the pictures, they are there in their turbans. Indeed, there is a picture of Sikhs in their turbans at Sandhurst dating from 100 years ago. Would the Minister please place copies of the responses to the consultation that was carried out earlier this year in the Library? That would give noble Lords an insight into the issues that I am about to raise.
Are the exclusions limited only to the Armed Forces and emergency services—fire, police and ambulance—or can employers in other fields avail themselves of those exclusions, such as the British Red Cross or other early responders? Are the Government agreeable to placing the exclusions of the Armed Forces and emergency services into secondary legislation? Will they commit to consulting the Sikh Council UK before issuing the guidance on the Bill, and can they ensure that relevant bodies for the Armed Forces and emergency response services encourage those services to engage with the Sikh Council UK to review existing practices and formulate new guidance and policies, as appropriate, in the light of the legislative change? Are the Government agreeable to extending the exemption for turban-wearing Sikhs from having to wear safety helmets in the pursuit of leisure activities, similar to the exemptions that are already in place for motorcycles and horse-riding? Technology advances over time and this is not only technologically possible but things may change in future, so would it be prudent to future-proof this legislation and not permanently set out exclusions in the body of legislation?
Baroness Thornton
My Lords, I understand that the Minister has something new for the Committee, which it may be better to hear before we proceed any further.
The Minister of State, Department for Transport (Baroness Kramer) (LD)
My Lords, as you will know, the Government introduced three measures into the Bill earlier this year relating to the regulation of taxis and private hire vehicles. Although an extensive review of the legislation has been carried out by the Law Commission and its recommendations are being considered, the Government decided that three measures could be taken forward separately to help reduce burdens on businesses more quickly. This clause is one of those.
Its purpose was to allow the use of private hire vehicles for leisure purposes. Noble Lords will be aware that, outside London, a person who is licensed as a private hire vehicle driver cannot use the family car and therefore has to purchase a second car. At £20,000 or £30,000, or the lease equivalent, that is a barrier which denies people employment. It is an issue that we need to address at some point. It also means in particular that in a number of rural areas there is, frankly, a shortage of private hire cars and taxi services. Bringing in more of those vehicles and their services for local people could be helped by removing this barrier.
However, after the Government listened closely to issues raised about the way in which we have presented this clause, we have decided that listening, as we always do, is important, and concluded that although we can still see arguments for tackling this underlying problem—I think that there is general agreement on that—it would be better done as part of the package of measures recommended by the Law Commission in a broader reform of taxi and private hire vehicle licensing than through this clause.
It is therefore my intent—although I am not sure how the procedure works—to withdraw this clause, and I am delighted to have the opportunity to do so.
Baroness Thornton
My Lords, I am very grateful to the Minister for withdrawing Clause 10 and I hope she will feel that Clauses 11 and 12 deserve the same treatment, given that the Law Commission has been asked to look into the current legislation. We are very glad that Clause 10 has been pulled from the Bill, but Clause 11 has problems and Clause 12 is just as dangerous as Clause 10.
Clause 11 will end annual licence renewal and set a three-year standard duration for licences. The annual licence renewal helps licensing authorities to recognise changes in a driver’s convictions or medical status. The reform is likely to make it more difficult for licensing officers to monitor behaviour, ensure that drivers are fit and proper to drive and take action when necessary. Effective implementation of this clause will require local authorities to sign up to the Disclosure and Barring Service’s updates service and receive information about convictions during a licence term. This is a relatively new service and it is not yet known how it will work in practice. It is clearly important, so I hope that the Minister will explain why this matter cannot also wait.
Clause 12 will enable PHV operators to subcontract a booking to another operator who is licensed in a different area. We and many others believe that passenger safety will be undermined because only licensing officers from a licensing authority where a vehicle and driver are registered currently have the power to take enforcement action. The Law Commission has recommended that licensing authorities would have the power to enforce standards in respect of out-of-area vehicles, which will be crucial for their safety. The public, and vulnerable passengers in particular such as women or disabled people, may call specific operators because they feel that that operator is reliable and safe to travel with. This reform means that the public will lose their right to choose which operator they travel with. If someone calls operator A, their preferred choice, operator B may turn up.
The Law Commission’s work was undermined in January 2014 when the Government announced a 10-day consultation on these three measures of PHV deregulation. In March, they were introduced as last-minute amendments in Committee in the Commons. The clauses aim to meet the Red Tape Challenge. The challenge is not about putting people in unsafe situations and Clause 12 does just that.
Richard Burden MP’s office contacted the Department for Transport on 1 October to ask whether an impact assessment had been prepared. The impact assessment was published online on 2 October and was signed off by the noble Baroness. Page 11 revealed many of the issues that have allowed Clause 10 to be withdrawn. Page 16 of the impact assessment states:
“There has been minimal analysis”,
due to what has happened. The analysis, it continued, was,
“based on the data provided by the PHV trade associations. Due to time constraints there has not been a significant amount of analysis”,
to justify these clauses being in the Bill. The Government have tripped over themselves to fulfil, as I said earlier, the Red Tape Challenge of bringing in deregulation. In this case, it means that they are putting people’s safety at risk.
The reason that Clause 12 is so important has been brought to our attention by a number of organisations, including some student bodies, Milton Keynes Council and Alexis Jay in her report into child sex abuse in Rotherham, in which she highlighted significant concerns about taxi licensing. We have spoken to her personally about this and she is very worried about the implications that these changes have. Her report says that, at a number of council meetings,
“One of the main items for discussion … was safe transport”.
When asked about minicabs,
“there was an immediate and consistent response from … young women and men”,
on all occasions. In fact, all of them avoided taxis “if at all possible”. People do not have any choice in remote areas late at night but to use taxis. If someone finds a safe taxi company—there are ones who focus particularly on women—they do not want someone to turn up whom they do not know and who may not be the appropriate person to drive them.
Our experience in Milton Keynes, where serious errors by a sub-committee of councillors on licensing led to an inexcusable decision to allow a convicted sex offender to operate a private hire vehicle, illustrates the importance of getting the balance of this regulation right. The leader of Milton Keynes Council has written to us personally, asking us to oppose the clause.
Warwick Students Union wrote to us, saying that its primary concern on Clause 12 is the effect that it would have on preferred suppliers. It says:
“We are working with local authorities to put together a tendering document for a preferred private hire service—using our strong collective consumer power to stipulate better standards of service, safety and fares. Lots of other Student Unions do this such as Leicester and Birmingham to protect their members”.
We know that two women students were raped in Warwick because they got into a minicab—possibly they should not have done so, but that is what happened. The student union continued:
“We feel that this Clause would largely undo the work done by Students’ Unions across the country to ensure the safety of their members”.
It is quite clear that the Government need to take this away and think again. That is what we are asking them to do. I am sure that the Minister would not want to have students and disabled people finding themselves in unsafe situations, but this is what we think the impact of the clause will be.
Lord Bradshaw (LD)
I support what has been said by the noble Baroness, Lady Thornton. Anybody who knows anything about the taxi trade knows that some parts of the trade are of questionable integrity. The annual licensing inspection by the local authority where the taxi is based is the best safeguard that we can have.
On the Minister’s point that this saves people buying a second car, saving them £20,000 to £30,000, I can assure noble Lords that most private hire cars are nowhere near that standard. In fact, I can reminisce about my time in Manchester, when I was being driven to the airport in a private hire car. We passed a very used car depot. I said to the driver that his car was very old. He said, “Yes, it’s got a few months to run on its MOT. When its MOT is up, I just go into the car auction and buy another one with a few months on its licence”. He was talking about spending £200. I think that is much nearer the truth.
I also dispute the view that many rural areas do not or cannot get taxis. I live in a rural area with big rural surroundings and there are plenty of opportunities to get taxis if one thinks about it and phones them up beforehand and that sort of thing.
Students and all women are very vulnerable when they get into a taxi where the driver has not been properly licensed and had his credentials inspected—indeed, if the vehicle itself has not been properly inspected. When I was on Oxfordshire County Council, Oxford City used to call in its taxis or private hire cars every six months because they have a high mileage and the annual check does not show up the defects. If we are talking about people having a licence to operate a taxi, an awful lot of things can happen in three years. Extending the situation so that a taxi could operate in an area where the driver is not licensed is potentially dangerous.
I do not see this as much in the way of deregulation. Local authorities do not spend a huge amount doing this work and the drivers have to pay a fee for it. However, I think it raises considerable dangers, to which the noble Baroness, Lady Thornton, has referred, and it would be far more sensible if the Minister were to take this away and carry out some more work on it. The Bill has some time to run. The protests I have received from local authorities and organisations that are concerned with the welfare of people—notably, the Suzy Lamplugh Trust but lots of others—are that people are genuinely concerned about safety. That is what I believe should be taken properly into account.
Baroness Kramer
My Lords, Clauses 11 and 12 cover separate, different but sensible measures. Obviously, a thought for safety penetrates all of our thinking as we address this range of issues.
To pick up on the issue raised by my noble friend Lord Bradshaw and explained by others, particularly my noble friend Lord Greaves, the amendments do not in any way change the rules on vehicle licences. Those are tough and carried out by local authorities and there is absolutely no change. If my noble friend Lord Bradshaw knows a firm that thinks it can run a £200 car for successful private hire and meet the standards, I suggest that he call the local authority. It would be extremely difficult for a car that has that kind of market value to achieve the standards that are rightly required by local authorities in licensing those vehicles.
Clause 11 aims to reduce the administrative and financial burdens on some taxi and private hire drivers. The measures we have included in the Bill, which I will address in relation to Clause 12, will also help to improve the experience of booking taxis and private hire vehicles. I join with others in saying that in making his case my noble friend Lord Greaves prayed in aid London. Both the measures in Clause 11 and Clause 12 are already the status in London. Indeed, when we turn to London as the example that we are trying to copy, that is exactly what Clauses 11 and 12 do. It means that we have a good history of the way in which Clauses 11 and 12 function.
Clause 11 will standardise at three years the duration of both taxi and private hire vehicle driver licences; and at five years the licence for a private hire vehicle operator. Shorter periods would be permitted only where there are specific circumstances around a particular application. For example, a local authority might decide that a probationary period was necessary. Typically the duration would be three years for the vehicle driver licence and five years for the operator licence. Frankly, it means that those people will not have to renew their licences as frequently as they do in some areas.
The Department for Transport carries out a biennial survey of licensing authorities. Our 2013 survey showed that nearly half of licensing authorities grant taxi and private hire driver licences for three years, so this is not a sudden revolution. A number of local authorities use a shorter term but we can see by comparing safety records that there is nothing to suggest that those local authorities that grant their licences at three years have an inferior record. That is important to note. When it comes to the operator licences, a number of licensing authorities routinely grant private hire operator licences for five years although the substantial majority do less than five years. Again, there is nothing to suggest that there is a difference in safety between one authority and another on the basis of those differences in licensing terms.
The Government therefore consider that this is an area of taxi regulation that would benefit from deregulation. By setting a standard duration of three years for taxi and private hire vehicle driver licences and five years for private hire vehicle operator licences life will be made a lot simpler and substantially cheaper for licence holders. We estimate that the measure will save drivers around £8 million per year and operators around £1 million per year. People who are in this trade are not wealthy people. They find it tough to make a living and any little help we can offer is valid when it is not putting safety at risk.
I appreciate that some stakeholders have expressed concern about safety implications. There may be a slight misconception. It is now the case that many licensing authorities that grant annual licences actually carry out criminal record checks only every three years. Although the licence is annual, the criminal records checks—the issue that has noble Lords exercised—are typically a three-year process. Of course, we are now saying that the standard for criminal records checks will be three years. That would be a relatively small change for most authorities. They will continue to do those formal checks. As I said, we have examples in London and in the many local authorities that already use that three-year cycle that it is not associated with additional risk.
Clause 12 will allow private hire vehicle operators to subcontract bookings across licensing boundaries. Again, this is a capacity that has been available continuously for London. The noble Viscount, Lord Ridley, made the case extremely well and illustrated the many situations in which this is an extremely important measure and the extent to which car hire companies outside London are put at a disadvantage compared with London operators. One of the main motivators behind this measure is that it is so difficult when people call a taxi firm that cannot provide a taxi and are then turned away. I have a relevant personal experience, which could have turned out to be extremely difficult. I was in Gloucestershire and going to visit an elderly friend in a nursing home. I got to the station and there was no one around. I looked at the board and started calling taxi firms and car hire firms and not one could supply a car. They explained to me that they could not call someone else because they would have to call out of the area and they could not do that. In such cases one would hope to have a mobile phone that is smart-enabled to get on to the web to try to find other firms in the area to call. I was glad that I was not a mother with three children, that it was not getting dark and that it was not raining. It seems unreasonable not to allow the taxi firm to subcontract in order to be able to meet the booking.
We are often concerned about young people out late at night who try to find a taxi to take them home safely. In that situation, we do not want them having to track down one company after another. They should be able to call an operator who they have confidence in who can find them a taxi, even if it is subcontracted from out of area. You can already subcontract in area, and I should make that clear to those people who may have used subcontracted taxis or private hire vehicles and were not aware of it.
The noble Lord, Lord Greaves, said that he was concerned about disabled people. Surely that is the group which has the most to benefit from this change. Most car hire companies have a limited number of wheelchair-accessible vehicles and there may be circumstances where a disabled person needs to travel in a particular kind of vehicle. It is all very well to say that disabled people need to make advance bookings, but I want people with disabilities to be able to live their lives as freely as the rest of us can and not always have to think about things in advance—or, frankly, have to do without. We have a mechanism here which gives an operator the scope to reach out of area and subcontract to someone else who has a wheelchair-accessible vehicle to meet a need. That is exceedingly beneficial.
I want to make it clear that the initial operator who takes a call and makes a booking remains liable to the passenger who made the booking. He is the person with whom the contract has been established. If someone chooses to call a particular operator, that operator retains the liability for the subcontractor, so the terms and conditions, the recording of the booking and the fare, if it has been agreed, all remain with the operator who the customer has contacted.
Baroness Thornton
I should like to ask the noble Baroness two questions. First, has she taken into account the fact that enforcement works differently in London, with TfL working in conjunction with the police on street enforcement, yet there is still a huge problem of sexual assault involving licensed minicab drivers? Secondly, how many disabled groups has she consulted about this deregulation and can she tell us what they had to say about it?
Baroness Kramer
I personally have engaged more with disabled individuals rather than with groups, which were approached by the Law Commission as part of the consultation. But the Committee will understand the reality of what I have just described. Many Members of the Committee will have friends with disabilities or indeed may themselves have them, and they will recognise what I have just described. It is for the Committee to make its decision, but I think that noble Lords will recognise the particular set of problems and will empathise with those who have a disability.
Enforcement against an operator continues to be the responsibility of the local authority which licensed that operator. Where there is an issue of enforcement against a driver, again it is for the local authority which licensed that driver to enforce. However, to make life easier and help things to work more smoothly, in some places around the country local authorities have concordats between each other so that they can delegate enforcement powers and thus make the process more simple and straightforward. Liverpool and South Bucks already do this, and I would think that it is a logical direction for many local authorities to go, not because enforcement is difficult but because it is even easier if ongoing relationships with neighbouring areas where subcontracting may take place are developed. We already have vehicles from out of area coming into area. When you order your private hire vehicle, you may be sending it out of area, so cross-boundary issues arise on a regular basis even as it is. As I say, some areas have decided that the sensible way to deal with this issue is to work together with a concordat between them.
The noble Lord, Lord Greaves, raised one issue which I thought was interesting and is one that I will take away and think about, and that is the issue of disclosure; that is, where an operator looks at the cars he has available, cannot find a vehicle available in his own company, and therefore looks elsewhere. That is something I will take a look at. However, I want to make it clear that there are real anomalies which we have to deal with. At the moment we have a silly situation in some parts of the country where related companies cannot subcontract to each other. Although they may be part of the same company, one branch will be licensed in one area and the other in another area. That, quite frankly, is one of the silly anomalies that we want to get rid of. Also, because the company you call and the individual you call is liable throughout, in order to uphold its reputation the company will make sure that the people it subcontracts to meet its own standards and are reputable. We have just heard today that very many people will turn to a company which they consider to be reputable. The notion that such a company would subcontract to drivers who let the company down, drive customers away and ruin its reputation is, I suggest, reasonably far-fetched. Under all circumstances, the driver to whom the business has been subcontracted has to meet licensing standards, and that is something we should not forget.
These are, frankly, two relatively small measures. The subcontracting issue is particularly helpful for someone with a disability who needs to call for a vehicle when many of a company’s cars within the area are already taken. We have to take that seriously. I go back to the issue on licensing. The three-year period is a reasonable standard that is used by many local authorities. It delivers the same level of safety that we see in other local authorities so why not relieve of an extra burden those who function at the margin in terms of income, if there is no safety price to pay?