Public Bodies Bill [HL]

Lord Hunt of Kings Heath Excerpts

Monday 4th April 2011 Lords Chamber

Moved by

[Lord Hunt of Kings Heath]

65: Clause 10, page 5, line 22, after “consult” insert “the public, including”

[Lord Hunt of Kings Heath]

My Lords, earlier in our debate noble Lords paid tribute to the noble Lord, Lord Taylor, for his conduct of the Bill, which I would certainly echo. He has brought forward some welcome amendments, which have strengthened the effective scrutiny of the Bill. I urge him to go one step further and respond positively to my amendments in this group. There is no doubt that, with Clauses 8 and 16 and the strengthening of Clause 10 on “Consultation”, there have been welcome additions. Will the noble Lord, Lord Taylor, agree to strengthen the Bill a little more as regards Clause 10? Essentially, what I would like to see is that, when a Minister proposes to make an order under Clauses 1 to 6, under Amendment 65, the public must always be consulted. Under Amendment 66, in relation to Clause 10(1)(a), I am suggesting that the body or the holder of the office to which the proposal relates ought to include staff and trade unions. In this Bill—despite the modifications that the noble Lord has brought, including one or two that we have voted upon—considerable powers still rest with Ministers to deal with the bodies contained in Schedules 1 to 6. In view of that, it is right that there should always be formal public consultation when an order is used under this Bill.

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[Lord Taylor of Holbeach]

My Lords, this has been an interesting debate that has built on the progress that we have made since the Government started tabling amendments in Committee, way back in November when consultation was first discussed. I thank the noble Lord, Lord Hunt of Kings Heath, for moving Amendment 65 to set up the debate and the noble Lord, Lord Kennedy of Southwark, for his amendment on local government.

In speaking to Amendment 65, I will also try to deal with the other amendments in this group, Amendments 66 to 68. Amendment 65 would insert a requirement that the public are consulted on all proposals before an order is brought forward under the powers in the Bill. The Government support the principle behind this amendment, which is to ensure that the public are given an opportunity to make their views heard on the reform of public bodies. In many instances it will be entirely appropriate and desirable for the public to be consulted on the reforms that we are delivering using the powers in the Bill. As the noble Lord, Lord Hunt, will know from first-hand experience, the Government publish guidance for departments on best practice in consultation, the current code having been issued under the previous Administration, of which he was a part.

The one-size-fits-all approach in Amendment 65 would not result in a better deal for the public. Where a full public consultation is appropriate, the Government will undertake one. Clause 10 does not preclude public consultation, which will be undertaken where the Government consider it appropriate, followed of course by the extensive parliamentary scrutiny required under new Clause 11. The evidence on whether the Government will act in a responsible and proportionate way is already there for your Lordships’ House to see. Take, for example, the consultation document on reforming the Equality and Human Rights Commission. This has been published in full on the Government Equalities Office website, has been laid in Parliament and will stay open for responses for three months. This is very clearly a reform that affects the public at large, which is why the Minister for Equalities and the Home Secretary decided to run a full public consultation.

However, the noble Lord cannot in all seriousness claim that it would be appropriate or proportionate for a full public consultation to be undertaken on the announcement and detailed implementation of the proposal to abolish Food From Britain, with all the associated costs of ensuring that such a consultation was accessible, widely distributed and adequately publicised, in line with best practice. That is why the Government believe that there should be adequate discretion in Clause 10 for the Minister to be able to carry out a consultation that is proportionate for a particular reform. I am not advocating complete discretion, and the Government have made it clear repeatedly in Committee and on Report that the powers of the Bill should be offset by clear and meaningful standards. Clause 10 plainly sets out these safeguards by defining a statutory minimum that the body or office-holder, and where appropriate the devolved Administrations, and the Lord Chief Justice must all be consulted.

My noble friend Lord Maclennan of Rogart rightly emphasised the importance of this consultative process. The Minister must comply with the Clause 10 requirements, and the details of the consultation must be included in the explanatory document that accompanies the draft order and proposal for Parliament to scrutinise. This is the point that my noble friend Lord Eccles made when he acknowledged his debt to the late Viscount Colville in the scrutiny of statutory instruments in the Merits Committee. It is not absolute discretion but, importantly, it builds in sufficient flexibility to ensure that on defunct bodies the Government are not compelled to run meaningless public consultations that incur unnecessary costs when we can least afford it.

Amendment 66, in the name of the noble Baroness, Lady Royall, runs into two similar issues in that it would put into statute something that in many cases is unnecessary. First, there are cases in which consulting staff would not be appropriate, such as where the proposal is a change to constitutional arrangements that would alter the name or method of appointment of the chair. In this case, Amendment 66 would add an additional burden without producing a meaningful improvement in the consultation process.

Secondly, the noble Baroness’s amendment cuts across existing requirements to consult and inform in specific circumstances. This includes TUPE and redundancy—the noble Lord, Lord Whitty, referred to the discussions that we have had on these—where there is already a requirement to consult trade unions, which was designed to build in a statutory guarantee for the situations in which such a requirement is appropriate. The problem with the amendment is that it would go beyond already well established requirements and codes of practice without considering whether such an additional burden was appropriate. I seek to reassure the noble Lord, Lord Whitty, that the Government are mindful of our obligation to consult trade unions where it fits the requirements of the Bill and to account for that in the explanatory document that we produce with the statutory instrument.

It is a similar story with Amendment 67 in the name of the noble Lord, Lord Kennedy. There would be clear cases in which the groups and organisations captured by his amendment should and would be consulted. However, that does not mean that putting such a provision into the Bill would change the instances in which such groups or organisations are consulted in practice.

Amendment 68 in the name of the noble Lords, Lord Hunt of Kings Heath and Lord Judd, and my noble friend Lord Greaves—neither the noble Lord, Lord Judd, nor my noble friend are here, and I continue to wish my noble friend a speedy recovery—would require a Minister to publish the proposed reform on their department’s website, in the event that a full public consultation was not required.

I do not believe that such a requirement is necessary in the Bill. There are a number of ways of seeking input from interested parties that may or not include publication on a departmental website. It would obviously be a very effective way in a major consultation, but it would be likely to vary over time. It is therefore not possible or appropriate to place these as a statutory duty in the Bill. The code of practice—the noble Lord, Lord Hunt of Kings Heath, is very familiar with it—encourages departments instead to,

“be clear about the reasons why the methods being used have been chosen”,

and further guidance supporting the code provides useful information on alternative forms of engagement that extend beyond simple publication on a website and that may be seen as a soft option when active engagement with stakeholders is preferable.

Consultation is an important issue and one about which the Government feel strongly. We believe that the amendments tabled and adopted in Committee, and which now make up Clause 10, represent a sensible and proportionate way to manage the diverse array of reforms that are being facilitated by the Bill. The amendments in this group, each in their own way, reduce the flexibility of the way in which consultations can be run, in many cases without substantively improving the quality or breadth of consultations.

Amendment 65 specifically requires that all consultations are full public consultations, regardless of whether such a consultation is necessary. It would therefore guarantee that all consultations incurred substantial costs without providing any meaningful improvement to the legislative scrutiny process. Clause 10, as drafted, provides a proportionate obligation to consult on the proposals to reform public bodies. I hope I can reassure the noble Lord, Lord Pannick, that it also provides that Ministers are accountable for that consultation process in the Explanatory Memorandum that they lay with any statutory instrument. Unless the noble Lord feels that the public need to be consulted, for example on the abolition of the already defunct Food From Britain, I urge him to withdraw his amendment.

[Lord Hunt of Kings Heath]

My Lords, I am very grateful to the noble Lord, Lord Taylor, and all noble Lords who have spoken in this debate. My noble friend Lord Whitty made some very important points about staff and trade unions, as did my noble friend Lord Kennedy about local government.

The noble Viscount, Lord Eccles, referred to the Merits Committee. As the first chairman of the Merits Committee I echo his remarks and the tribute he paid to the late Viscount. I recall that looking at the consultative process undertaken by departments was a very important part of that scrutiny. I certainly take his point that any order that a Minister wished to make under this Bill, when it becomes law, would go through scrutiny by committees of your Lordships’ House. His argument would have more power were the noble Lord, Lord Taylor, to intimate that he is prepared to accept my later amendment on the use of the super-affirmative procedure, but, alas, I do not see the noble Lord quite ready to intervene on that point.

The noble Viscount is certainly right about Clause 10(1)(g). It allows a Minister to consult “such other persons”, but should that be left to ministerial discretion? As the noble Lord, Lord Pannick, said, the powers contained in the Bill are considerable. As a result, there need to be safeguards. I believe that automatic public consultation is one of those safeguards.

The Minister said that he supported the principle behind my amendment and that in many instances it is entirely appropriate and consistent with best practice, but he also said that there may be circumstances in which public consultation is not appropriate, and he instanced an organisation that may have been in abeyance. Surely the response to that comes from the Minister’s friend, the noble Lord, Lord Maclennan, and the noble Lord, Lord Pannick, who say that consultation in those circumstances can be proportionate. Therefore, there could be a very modest public consultation in those circumstances.

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Moved by

[Lord Hunt of Kings Heath]

68: Clause 10, page 5, line 40, at end insert—
“( ) Where the responsible Minister considers that the changes proposed do not warrant a full public consultation under subsection (1), the Minister must publish a copy of the proposal on the website of the relevant government department or make it otherwise publicly accessible.”

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[Lord Hunt of Kings Heath]

My Lords, in the light of the debate, given that this is a very modest amendment, would the Minister consider accepting Amendment 68? I beg to move.

[Lord Pannick]

I support the noble Lord’s observation. The Minister, in his response to the previous amendment, agreed that a full public consultation would be highly desirable in many, if not most, circumstances, but in some cases it would not be appropriate to have a full public consultation, and it seems to me that Amendment 68 deals precisely with that point.

[Lord Taylor of Holbeach]

My Lords, I am under instructions to resist—I think that is usually the phrase that is used. However, I understand the arguments that have been put forward by noble Lords to have a requirement, where public consultation does not take place, that at least the proposal is put on the website. I think that the Government are in a position to consider this and, if necessary, will bring forward an amendment at a later stage.

[Lord Hunt of Kings Heath]

My Lords, that is very handsome of the Minister and we look forward to coming back to this on Third Reading. I beg leave to withdraw the amendment.

Amendment 68 withdrawn.

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Moved by

[Lord Hunt of Kings Heath]

69: Clause 11, page 6, line 3, leave out “may” and insert “must”

[Lord Hunt of Kings Heath]

My Lords, we come to a very important group of amendments that is concerned with the procedure-making processes in Parliament when it comes to an order. As we have already debated, it is very important, when a Minister seeks to make an order, that it enjoys stringent parliamentary scrutiny. We welcomed the Minister’s amendments to introduce greater scrutiny than was envisaged when the Bill was first drafted. There is no doubt that what he describes as extensive parliamentary scrutiny is an advance. However, I want to encourage him to go a little further.

The Minister will, of course, be aware of the advice that your Lordships’ House has received from the Delegated Powers and Regulatory Reform Committee, which reported to the House on four occasions. I refer noble Lords to the committee’s report of 7 March that reminded the House of the key differences between the noble Lord’s amendment that has been made to the Bill and my amendment. The report said that there are two key differences between the Government’s enhanced procedure and the provision in the Legislative and Regulatory Reform Act 2006 that introduced the super-affirmative procedure on which my amendment is based.

The committee said that under the 2006 Act,

“if a committee of either House recommends that no further proceedings be taken on a draft order, then any further proceedings are automatically stopped unless and until the recommendation is rejected by that House itself”.

The committee also reminded us in March that under the 2006 Act,

“a Minister wishing to proceed with an order unaltered after having been required to have regard to representations must lay a statement before Parliament giving details of any representations received”.

The committee pointed out that this matter would also enjoy enhanced scrutiny.

When we discussed this matter in Committee, at col. 1723, the noble Lord, Lord Taylor, essentially said that because Schedule 7 had been removed, the scope of the Bill had been significantly narrowed and a more restrictive scrutiny procedure was therefore required than that in the regulatory reform Act. I understand where the Minister is coming from, but I do not agree with his conclusions. Even with the safeguards that the Minister has introduced and the removal of Schedule 7, the Bill still gives considerable powers to Ministers. When one looks through the Bill, the powers to abolish, to make changes to the financial arrangements, and to change the governance arrangements are considerable. The use of the super-affirmative procedure is, therefore, entirely appropriate.

I know that the noble Lord’s department has said that it believes that the super-affirmative procedure that I propose would risk derailing the Government’s reform programme, but I want to make it absolutely clear that I support the regular review of these public bodies. I have never had any difficulty whatever with the principle of the Bill. No public body should believe that it is entitled to exist for all time. It is right that public bodies should be reviewed. I have no problem at all with that principle in the Bill. However, we come back to the point of ministerial powers. I remember being reminded, when I was sitting or standing where the noble Lord is sitting at the moment, that ministerial powers need to be fettered. Under the Bill, many organisations doing public work can be affected by the use of ministerial power. Parliament needs and deserves the most stringent scrutiny powers possible. The super-affirmative procedure is not new. It is used within the confines of the Legislative and Regulatory Reform Act.

The noble Lord says that if we were to pass such an amendment, it would have an impact on the other place and its procedures. My argument is: let us see. Let this House pass the amendment, agree to the super-affirmative order and see how the other place responds. We are not at the last point of this Bill’s journey through Parliament and it would not be unreasonable for noble Lords to express the view that orders under the Bill should be considered under the super-affirmative procedure. I beg to move.

[Baroness Thomas of Winchester]

My Lords, I hope that the noble Lord, Lord Hunt, will forgive me if I do not go down the path of discussing his amendment in detail, as I am the chair of the Delegated Powers and Regulatory Reform Committee. However, I will say that this group of amendments gives us the chance to discuss the wider issue of parliamentary scrutiny arrangements of orders made under the Bill.

The House should not try to pin down the Minister today on exactly how scrutiny under the Bill should be conducted, particularly as the other place has yet to consider the Bill. However, it is important to set out a few questions that should be asked at this stage. Under the Bill, every draft order has a 40-day period during which a committee of either House looks at it. This committee must report on the order within 30 days. Under the revised Bill, the committee can require an order to undergo a full, enhanced scrutiny procedure. At present, the Lords committee charged with looking at all orders coming before the House is the Merits of Statutory Instruments Committee, which has been spoken about a lot this afternoon. It may draw orders to the attention of the House either because they may be of interest or because they may imperfectly achieve the policy objective. The committee is already busy and meets nearly every week. The first question might be whether this is the right committee to look at orders made under the Bill, whether under the enhanced scrutiny procedure or not.

In the Delegated Powers Committee’s fifth, sixth and 11th reports, the enhanced scrutiny procedure on orders under the Bill was compared, as the noble Lord, Lord Hunt, said, to the super-affirmative procedure in the Legislative and Regulatory Reform Act 2006. As this is the nearest procedure to the one we are discussing, it may be worth restating that legislative reform orders come before the Delegated Powers Committee, but are significantly different in character from orders under the Bill. The two main differences are that the LRO procedure is not used for highly controversial matters, and that if a committee of either House recommends that no further proceedings are taken on a draft order, then proceedings are automatically stopped unless the House decides otherwise. The committee has looked at only 12 LROs since the 2006 Act.

However, the Bill is likely to generate a lot of work—and, at some point, an entirely new procedure. Therefore, it must be decided quite soon which committee should undertake the enhanced affirmative procedure if it is required. Although this will, of course, be a matter for the Procedure Committee and ultimately for the House, I believe it is worth thinking about now.

There are some fundamental questions to be asked about how a committee should carry out its work before either House decides on a suitable committee structure. Should it simply review the evidence taken during the consultation? Should it take evidence itself? That could be an expensive process. The only purpose in the Bill is, as we heard this afternoon, to improve the exercise of public functions, although it must have regard to the objectives of achieving increased efficiency, effectiveness and economy—the Minister’s triplet—and securing appropriate accountability to Ministers. Suppose the committee decides that the broad purpose of improving the exercise of public functions is not met, will the Minister think again? After all, he only has to have regard to a committee’s recommendations. Obviously the order will have to be passed by both Houses and there is always the possibility of it being voted down. That this House is reluctant to do this should not be taken for granted.

Turning very briefly to the procedure in the other place, the two Houses have different ways of looking at statutory instruments and different committee structures from each other. The only joint committee in this area is the Joint Committee on Statutory Instruments, which just looks at the vires of an instrument with the parent Act. Although a superficially attractive idea, a joint committee is very difficult to establish. I understand that this is too early for any hard-and-fast decisions on how orders made under this Bill are to be scrutinised by Parliament, but it is not too early for Parliament to be thinking hard about the implications of the proper scrutiny of the delegated powers in this Bill.

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[Lord Taylor of Holbeach]

My Lords, I can confirm that every statutory instrument will have to be accompanied by an Explanatory Memorandum. That is very important if a statutory instrument is proceeding under this Bill.

[Lord Hunt of Kings Heath]

My Lords, I am sorry, too, but would like this to be clarified. At the moment, the clause says:

“If after consultation under section 10 the Minister considers it appropriate to proceed with the making of an order under sections 1 to 6”.

The Minister has already decided, in the light of consultation, that he is going to proceed with the order. That is not now in doubt because he,

“considers it appropriate to proceed”.

Surely it should then say that the Minister “must” lay that before Parliament. I do not understand why it is not “must”.

[Lord Taylor of Holbeach]

I make my point quite simply: if he does not lay an order, he will not get it approved. It is as simple as that; that is the nub of the issue. In order to get the change he requires, he has to lay an order and “may” is the correct word to use, in parliamentary terms, as the noble Lord will know.

[Lord Hunt of Kings Heath]

The next subsection uses “must”. I know that this is a very familiar argument, but it is quite clear that “must” is often used in legislation and I do not see why it is not used in this case.

[Lord Lester of Herne Hill]

I am in more of a muddle now than I thought I was. Clause 11(1) proceeds on the basis that,

“the Minister considers it appropriate to proceed with the making of an order under sections 1 to 6”.

That is the premise. If that is the premise, surely the Minister will have to lay a draft order and an explanatory document. If that is the position and there is no scope for discretion at that stage—because he or she has already made the determination that it is appropriate to proceed—I do not understand why it does not say “shall” or “must”. It says “must” elsewhere and it seems to me that it is a situation where it is a “must” and not a “may”. Maybe I have got it wrong.

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I hope the noble Lord, Lord Adonis, will see that this is what makes this Bill somewhat different from the Regulatory and Legislative Reform Bill. We are dealing with specific proposals laid before Parliament in primary legislation. I am not opposed to proper parliamentary scrutiny of government policy; my approach to this Bill and the Government’s proposed enhanced procedures demonstrate that. However, I am opposed to a procedure that would not increase the quality of such scrutiny, but would endanger our ability to deliver the more efficient and effective system of public bodies that the public rightly expect. That was promised in the coalition agreement and has the support of noble Lords from all sides of the House and, indeed, from the Benches opposite. I therefore ask the noble Lord to reflect on the consequence of his position in the light of my remarks and to withdraw his amendment.

[Lord Hunt of Kings Heath]

My Lords, I am sure that we are all very grateful to the noble Lord, Lord Taylor, for his extensive response to this debate. I will make three short points. The noble Baroness, Lady Thomas, is right to raise the wider question of how secondary legislation is dealt with in your Lordships’ House. The Royal Commission on Lords Reform looked at this extensively. One of the outcomes was the development of the Merits Committee but I am sure we need to go further. I hope that when draft legislation on House of Lords reform finally reaches us, we will see that there has been some discussion of that matter. I do not believe you could elect a second Chamber, or make proposals to do so, without looking at the implications for secondary legislation.

On the question of “may” and “must”, I have looked again at the wording of Clause 11. This order falls to be made only after the Minister considers it appropriate to proceed with the making of an order. On that basis, the word should be “must”. On the question of Amendment 71 and the super-affirmative procedure, I accept that the noble Lord, Lord Taylor, has tabled several welcome amendments to improve the Bill and allay many concerns. I just say to him that, none the less, this Bill gives Ministers considerable powers to amend primary legislation through what can be dramatic changes to a number of the public bodies listed in the Bill. On that basis, it is right that Parliament should assert to itself the ability for strong and robust scrutiny. My super-affirmative proposition allows that to happen. I very much hope the House will support me in that regard. I wish to test the opinion of the House.