Small Business, Enterprise and Employment Bill

Baroness Thornton Excerpts

Monday 12th January 2015 Grand Committee

Moved by

[Baroness Thornton]

33H: Clause 17, page 19, line 14, at end insert—
“( ) The following regulators are excluded from the provisions outlined in this section—
(a) the Equality and Human Rights Commission;(b) relevant regulators in—(i) the Department of Health;(ii) the Department for Transport;(iii) the Department for Work and Pensions;(iv) the Department for Business, Innovation and Skills;(v) the Department for Culture, Media and Sport;(vi) the Department for Communities and Local Government.”

[Baroness Thornton (Lab)]

My Lords, it is a great pleasure to be in the Grand Committee today to support my noble friends and to speak to the three amendments in this group.

Amendment 33H would exclude the EHRC and relevant regulators in departments. In the discussions on the Deregulation Bill, we expressed concern about the regulatory provisions in this Bill. Clause 18 sets out the process for specifying regulatory functions and bringing them within the reviewer’s remit. It provides that the Secretary of State may, by making regulations, specify regulatory functions to which the duty set out in Clause 17, “Review of regulators’ complaints and appeals procedures”, applies. Amendment 33J would limit it to regulators that the Deregulation Act requires to have regard to growth. In Clause 21, the Secretary of State has a duty to publish the business impact target. Amendment 33M would ensure that, at the same time, the Secretary of State must publish a list of regulatory bodies that the Deregulation Act requires to have regard to growth.

We are asking the Government to assure us that there has been a legislative read-across. The Minister will be aware that the status of the Equality and Human Rights Commission was discussed in the course of the Deregulation Bill, and we expect to return to that on Report. As noble Lords will know, the EHRC enjoys an “A” status as a national human rights institution. I am dealing with these amendments because I am the shadow equalities spokesperson—I dealt with this issue all the way through the consideration of the Deregulation Bill and hope to continue to do so. We need to be clear that it is not appropriate to apply these regulations to the EHRC. We need to be assured that the Government recognise this and have taken steps to ensure that it does not happen. We sought to put it in the Deregulation Bill. I am sure that the Minister will be completely up to speed with this and that she and her colleagues will have discussed how best to deal with it as regards this Bill.

This is important because “A” status is awarded by the United Nations International Coordinating Committee of National Human Rights Institutions, which reviews the EHRC’s compliance with the United Nations’ Paris principles, which require the EHRC to be an independent body. We think that the Government have decided to exclude the commission from the list of non-economic regulators subject to the growth duty provisions in the Deregulation Bill, but, as I say, I seek further clarity on that. That is important because we have to avoid the reality, or the perception, of interfering with the commission’s ability to perform its regulatory functions independently. If that was jeopardised, it would, in turn, jeopardise its “A” status. As it is our human rights body, having an “A” status is of great importance to the UK’s international standing and reputation. It enables the UK to influence the protection of fundamental rights globally and it gives us a voice at the Human Rights Council. Any downgrading of the commission’s status would have a significant negative impact on the UK’s global influence.

Have the Government decided to exclude the EHRC from the list of regulators covered by Clauses 17 to 19? That question is at the heart of these amendments and that is the clarification we seek. I beg to move.

--- Later in debate ---

[Baroness Thornton]

Rereading this, I wonder whether I could ask the Minister a question about Clause 21(4), which says that:

“The Secretary of State must lay each thing published”.

I was responsible for taking a Bill through the House which used “thing” in it. We spent a great deal of time defining what “thing” meant. That was in the medical world and we came to the conclusion that, in that context, “thing” was the word that had to be used. However, I am not sure whether “thing” needs to be used here when we are talking about publications. The Minister may not need to answer what I ask now, but perhaps she would like to think about it.

[Baroness Neville-Rolfe]

My Lords, I thank the noble Baroness for bringing her experience of other areas, with a certain levity, while raising a good point. I will certainly take it away and look into why the drafting was done as it was by parliamentary counsel.

Amendment 33J relates to the duty on regulators to have regard to growth. That duty will of course be created by the Deregulation Bill, which we have also been considering in this House, and which includes similar provisions to this Bill giving the Secretary of State power to make regulations establishing which regulators should be covered by it. Like the small business champions, the growth duty is part of the Government’s better enforcement programme to improve regulatory enforcement. The champion will seek to improve scrutiny and governance on the appeals and complaints processes of a regulator and has no vires over individual regulatory decisions. The growth duty seeks to ensure that regulators have regard to growth when they take regulatory action.

The two policies will apply to many of the same regulators, but there will be a few differences at the margins. I agree that there may be regulators for which the growth duty is not appropriate, but I do not believe that this would automatically mean that a champion would not be of benefit, for all the reasons we have been discussing. For instance, the Pensions Regulator will not be subject to the growth duty because it already has an equivalent duty under its own statute. But we see no reason why it should not have an appeals champion, and have proposed as much in our recent consultation paper.

--- Later in debate ---

Amendment 33M relates to reporting on the list of regulatory bodies subject to the growth duty.

[Baroness Thornton]

My Lords, I apologise for intervening, but the noble Baroness will be aware that, if this is done under statutory instruments, there is no power to amend them, which is why it is very important to get things right in Bills.

[Baroness Neville-Rolfe]

We are serious about the terms of our consultation. I have explained why I think that we are right to do it the way that we are. The list is available, and I will ensure that the noble Baroness has a copy of it, but I think that the material point for her is the undertaking I have already made standing here in Parliament about the EHRC, where I think that we are in agreement.

On Amendment 33M, the business impact target and the growth target are two very different policies. The growth duty applies to regulators and the target to the Government. The target relates to regulatory legislation, whereas the growth duty is about influencing the behaviour of regulators on the ground. Having a report on the coverage of one policy included in a publication about the details of another risks confusion rather than adding to transparency. The growth duty is covered in the Deregulation Bill, and we should not confuse matters by adding it to this Bill as well. We already have full transparency about the list of regulatory bodies to which the growth duty will apply. The Deregulation Bill provides for that list to be prescribed in regulations, which are subject to affirmative resolution. Anyone wanting to understand the coverage can and will look at that list. Duplicating it as part of an unrelated publication does not seem to be the right thing to do.

I have received important advice on the subject of the meaning of “thing” in the Bill. It refers to several different things—thus the use of the phrase—including the business impact target, the interim target, the methodology and the scope of the target. I suppose that that was the best wording that they could come up with for that purpose.

I hope that I have answered the noble Lord’s questions and the wider questions raised by my noble friend Lord Eccles. If I have not, I am sure that we could discuss those points further. We do not believe that the amendments are necessary. I hope that some reassurance will have been taken from my response and that, in the circumstances, the noble Baroness will agree to withdraw the amendment.

[Baroness Thornton]

I thank the Minister for that comprehensive answer. I thank the noble Lord, Lord Deben, for referring to me as high minded and for his support. I do not take that as any reflection on my noble friends and their efforts in this regard. I am very grateful to the Minister for that reassurance. I know that the noble Baroness, Lady O’Neill, has received her letter and is very grateful for it. It is not that we will stop keeping a weather eye on these issues, but this one looks like it will be okay.

My noble friends will probably be returning to Amendment 33M, because there are issues about having the Deregulation Bill and this Bill, with business impact targets and the growth targets. I think that further clarification will be sought, but that is not my job right now, so I beg leave to withdraw the amendment.

Amendment 33H withdrawn.