Bribery Act 2010: Post-legislative Scrutiny (Select Committee Report)

Lord Hodgson of Astley Abbotts Excerpts

Wednesday 3rd February 2021 Grand Committee

[Lord Hodgson of Astley Abbotts (Con) [V]]

My Lords, I too was a member of this committee and I enjoyed serving under the chairmanship of the noble and learned Lord, Lord Saville of Newdigate. Like my noble friend Lord Empey, I also pay tribute to our excellent staff, marshalled expertly by Michael Collon. I chaired a different committee which Michael was clerk to, and so I spoke to him just before Christmas and found that he was retiring from the House on 31 December last. I am sure that I speak for the committee and indeed the whole House when I wish him on behalf of all of us a very happy retirement. I expect that he may well have tuned in to watch this debate this afternoon.

In my remarks I will focus on just three points: the position of SMEs in relation to the Bribery Act; the role of the Government’s anti-corruption champion; and finally, like several other noble Lords, including my noble friend Lord Gold, I shall urge the Government to reach a decision on the widening of the “failure to prevent” offence. These three points need to be considered in the context of the overall conclusion of our report, which is, as our chairman said in his opening remarks, that the Act is an excellent piece of legislation.

First, on the SMEs, it is important that the Government always remember how narrow the management bandwidth inevitably is. Unlike big companies, they cannot double-bank roles. Management time is a precious and scarce commodity. It is therefore critical that decisions on whether to prosecute are taken promptly. To have a sword of Damocles hanging over an SME will, if not paralyse it, certainly render it much less effective. Therefore we were not impressed by the slow pace of progress by investigations of these cases. Most disturbing was the stop-start nature of many of them. Interviews would take place followed by long periods of silence: 12, 15 or 18 months, we were told in the evidence we received.

The Government’s reply to this at paragraph 17 in their response document was that progress was being made, and they prayed in aid that now all preceding cases over two years old will be given special treatment to speed the decision. Two years of uncertainty is a quite unacceptable burden on any company, but particularly on a smaller one, where ownership and management may well be combined. SMEs whose business is focused particularly on exports have, of course, to face the grey area of corporate hospitality, and it would be good to know what progress has been made in fulfilling the pledges made in paragraphs 73 to 75 of that document. Overall, one was left, as other noble Lords have said remarked, with an underlying suspicion that SMEs could be seen as a happier hunting ground for prosecutors. The directing mind principle, referred to by the noble Baroness, Lady Bowles, the inevitably less well-resourced defence and the pressure on small management claims to clear up and move on will all be factors that may lead prosecutors to see an opportunity to make an example. In the Skansen Interiors case, which we examined in some detail, it was interesting that it was not even offered the opportunity of a deferred prosecution agreement.

The next point I want to make concerns an update from my noble and learned friend on the Front Bench on the role of the Government’s anti-corruption champion. I make it clear at the outset that I am not in any way attacking John Penrose MP, who currently holds that position. He is in an unenviable and probably impossible position. In that old country phrase, he is set to get most of the kicks and none of the ha’p’orth. His role seems to be a token nod towards the importance that the Government place on anti-corruption activities, and he appears to have neither the clout nor the resources to be able to carry out the detailed investigations or effect real change. Indeed, until July last year, Mr Penrose was combining the role with that of a Minister of State in the Northern Ireland office.

When my noble and learned friend comes to wind up, can he lift the curtain on the Government’s policy objectives for this post? What is its budget, what staff does it have and to whom does the anti-corruption champion report? What practical results can the Government point to? It is interesting that, if you do a Google search, one of the only entries on the website is Mr Penrose’s appearance before our committee on 10 July 2018.

I return to the issue of Section 7 on failure to prevent, which is seen, as many noble Lords have said, as one of the key parts that drives against corruption and which has proved pretty successful. The Government have taken an inordinately long time to reach a decision as to whether the scope of this offence should be widened to cover economic crime generally. The original consultation paper was issued by the MoJ in January 2017 and the consultation closed at the end of March that year. Now, four years later, we are still awaiting a decision. Can my noble and learned friend please give us a heads-up on the latest position on this when he replies?