Small Business, Enterprise and Employment Bill

Lord Phillips of Sudbury Excerpts

Wednesday 11th March 2015 Lords Chamber

[Lord Low of Dalston]

My Lords, I have put my name to all these amendments, which have been spoken to so ably by the noble Lord, Lord Wills. I will speak very briefly to them in the order in which they were grouped.

I very much welcome the Government’s speedy response to the recommendations of the report by Sir Robert Francis on speaking up, or whistleblowing, in the NHS. However, like the noble Lord, Lord Wills, I am concerned that too narrow an approach has been taken to the issue of protecting whistleblowers in the job application process. Surely it is not right to adopt such a piecemeal approach to the development of legal protection for whistleblowers. This is why I support Amendment 58ZA, tabled by the noble Lord, Lord Wills, which calls for the protection of anyone who, in applying for a new job, is discriminated against for making protected disclosures or for blowing the whistle in a previous job. I emphasise anyone, not just workers in the NHS. The Government’s movement on this issue and their recognition of the principle is very welcome but, like the noble Lord, Lord Wills, I cannot for the life of me see why they should confine their approach to the NHS. Surely what is good for workers in the NHS must be just as good for workers in any other sector. This is an issue that many whistleblowers have said results in real hardship, as is evidenced in the Francis report. I believe that anyone who is not employed because the potential employer knows about their whistleblowing activity in a previous job should be able to remedy such discrimination in law.

I also support Amendment 59, as I believe that it will assist the Government in taking a cross-sector, strategic view of the UK whistleblowing framework. As the noble Lord has indicated, now is the time to put in place a structure that will collect and analyse not just the reforms in this Bill but recommendations from other inquiries that will impact on the whistleblowing framework, whether these come from the banking sector, the NHS, social services or the police. There is real value for employers, regulators, the Government and society as a whole in reviewing these issues on a regular basis. I hope very much that the Minister will see this amendment, which provides for a regular review of the whistleblowing framework, as a useful mechanism not just for identifying what is missing from the framework but also for helping to spread and encourage good practice among employers.

Turning finally to Amendments 59A to 59F, which give power to the Secretary of State to establish a number of national whistleblowing review officers, I agree with the noble Lord, Lord Wills, that a role such as this will help to plug the regulatory gap that exists in the whistleblowing framework. This would make it possible for such a national whistleblowing review officer role to be created, by order of the Secretary of State for Business, Innovation and Skills, in any industry, not just in the NHS, as the noble Lord, Lord Wills, said. This role complements the regulatory reporting provisions contained in the Bill that the Government intend should drive change in relation to whistleblowing across all industries. It will enable a review officer to be created in any sector or industry, whether that is financial services, the health and care sectors, or services in relation to vulnerable adults and children.

Given the very many scandals brought to light by whistleblowers in recent years—in our care homes, our schools and our local authorities—I consider that such a role could only do good in driving forward the development of good practice in whistleblowing across all sectors. What is more, a role that has the features described in this amendment will provide a quick and simple warning system for regulators and organisations where there is a failure to deal properly with a whistleblowing issue. I therefore look forward to hearing the Minister’s response on these amendments, which I am pleased to support.

[Lord Phillips of Sudbury (LD)]

My Lords, my name is also to this group of amendments. I thank the noble Lords, Lord Wills and Lord Low of Dalston, for making most of the points that need making, and making them forcefully.

It seems extraordinary that the Government should have introduced Amendment 58A in the wake of the 200-page report by Robert Francis QC, entitled Freedom to Speak Up and published only last month. It is bizarre that they confine the provisions in the amendment to the National Health Service, for reasons which have been touched on by the two Peers who have already spoken. The need for the protection of Amendment 58A is universal.

I should perhaps say that in my long legal career I have dealt with a number of whistleblowing cases, and was charged back in the 1980s with trying to register a charity which had as its principal purpose the support of whistleblowers. That was successful—not, I may say, without vast and prolonged effort, because at first the Charity Commission viewed the very idea as bizarre. In 1993, the charity Public Concern at Work was formed and is still operating with huge effect. All of us here tonight are grateful for the work that it has done and the information which it has provided to us under the leadership of Cathy James. Its work leads it even now—or perhaps more than ever now—to advise about 800 people a year who have personal, direct, often plangent problems in relation to their employment and their attempt to try to get those who employ them to take seriously malfeasance—sometimes corruption, sometimes wilful and terrible illegality.

Public Concern at Work is, as I said, better informed than any other agency in this country as to just what whistleblowers have to go through. Our point is that whistleblowers are not some little sideshow. If we are serious about attacking the widespread and growing corruption and criminality that, I fear, infects so much of what we value in this country, we have to support whistleblowers. Frankly, they are the only people who can uncover criminality at source, often at a time when, if it can be dealt with, doing so will save vast loss and suffering. One has to look only at the collapse of the financial markets of the world, led by the City of London in 2008, to realise just what terrible losses we have all suffered—trillions rather than billions—by reason of the fact that there were virtually no whistleblowers from within the City of London, or indeed the other financial centres, who were able to get the facts relating to what was going on in their entities to the authorities in time for them to take action.

Again, I have a certain amount of personal experience of this. One thinks, for example, of Paul Moore of HBOS. He blew the whistle, except that he blew the whistle to his own board, saying openly and clearly that the measures taken in that bank to balance risk and opportunity were unsustainable and were leading the bank, and had led the bank, into the most dangerous of situations. He not only got no succour when he took this matter up the scale in the bank but has not had a job in the City of London since then—we are talking about 2007 or 2008—despite his huge experience as a former partner at KPMG and senior financial officer at HBOS.

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[Baroness Neville-Rolfe]

My Lords, I am not sure that we are going to agree this evening on extending to other areas the provisions that we are very happy to include for the NHS. I have made clear that we need an evidence base and that we are doing things in other areas. The things that we are doing in other areas, to which I hope to move on, will also help to show what is happening on the ground. The debates that we have had in the House, which the noble Lord, Lord Wills, has encouraged us to have, will also change the culture in relation to whistleblowers. The very fact of the disastrous circumstances in the NHS has shown how important whistleblowers are, which is why we are making the changes that we are in relation to recruitment in the NHS.

If I may make progress, I will turn to the noble Lord’s Amendment 59, which seeks to introduce a rolling statutory review of the whistleblowing legislation. I can reassure the noble Lord, Lord Wills, that it was only last June that the Government reported the findings from their call for evidence that reviewed that legislation. The Government have also carried out an extensive employment law review during this Parliament. Looking to future review processes, we see that post-legislative scrutiny is applied to all changes to legislation five years after the measures have come into force. We have an impressive rolling programme. The changes that we introduced to the whistleblowing framework in the Enterprise and Regulatory Reform Act 2013, and the changes in this Bill, will be included in the rolling process. Considering the steps that we have taken to review employment legislation, and specifically whistleblowing legislation, I do not believe that it is necessary to introduce another review next year.

I turn now to Amendments 59A to 59F, which seek to create a national whistleblowing review officer. The Government fully understand the intention behind the proposed new clauses, which is to ensure that concerns raised by whistleblowers are acted upon. We know from research carried out by the University of Greenwich and Public Concern at Work that 75% of whistleblowers believe not enough is done about the concerns that they report. We want employers or the relevant authority to take action. That is why we are introducing the important measures in this Bill to require prescribed persons to report on how they handle whistleblowing concerns. That will increase transparency and reveal any circumstances where whistleblowing concerns are not addressed. The Government will want to allow time for this measure to take effect before they consider yet further measures. Introducing a body that has oversight of all investigatory action in response to whistleblowing concerns would be one way of going further, depending on what the need for further action was. But of course there could be other options for the Government to consider, based, as I have said, on evidence. Before introducing legislation, the Government will want to carry out a proper assessment of all available options to ensure that they are not introducing a body that was duplicating the existing functions of the regulators. This is a complex area.

Evaluation work will begin by the Department of Health publishing a consultation, which will explore the case for creating an independent whistleblowing guardian for the NHS. The Government will be able to use the evidence gathered from that consultation to look at the situation in other sectors. I cannot emphasise enough the importance of having a proper evidence base and the fact that we have been able to fast-track the Francis recommendations because of the very powerful work that he has done.

The Government are committed to addressing the barriers that whistleblowers face. In addition to the measures in this Bill, we have made significant progress. Perhaps I could mention some other measures that we have taken forward. We are updating a set of comprehensive guidance for whistleblowers and employers as well as introducing a non-statutory code of practice for employers. The Government intend to publish this shortly. We have carried out work to update the list of prescribed persons. This is a list of more than 60 individuals and bodies, which includes all MPs, that a whistleblower can approach to raise their concerns. The Government have recently introduced separate legislation, which comes into force in April this year, to extend the scope of the whistleblowing framework to student nurses and student midwives.

The whistleblowing framework is improving and robust processes are in place for future work and the continuous review of the legislation that we have introduced. I hope that the noble Lord will agree that much further exploratory work would be required before proper consideration could be given to his proposal for a national whistleblowing review officer and for extending legislation to cover all job applicants, whether in the public or the private sector.

We have made a major change in relation to the NHS. Perhaps that has eclipsed the other important changes in this Bill and other progress that we have made on whistleblowing. I commend the Government’s amendment and invite the noble Lord to withdraw his amendment.

[Lord Phillips of Sudbury]

My noble friend the Minister said a number of times that there is insufficient evidence for extending what the Government are doing in this Bill vis-à-vis health to other sectors. Let us think again of the financial centre of this country. The collapse that we had in 2008 was perhaps the greatest financial collapse in our entire island history. It involved extensive and universally accepted huge breaches in the criminal law: the LIBOR fixing, the forex fixing, PFI—the list goes on and on. How can my noble friend say that there is insufficient evidence to warrant extending to this sector, if none other, some of the requirements that we are now extending to the health service?

[Baroness Neville-Rolfe]

My Lords, we are bringing in the new process provided for in the Bill which will allow greater review and engagement in those other sectors.