Public Bodies Bill [Lords]

Nick Hurd Excerpts

Tuesday 25th October 2011 Commons Chamber

[The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)]

I beg to move, That the clause be read a Second time.

[Mr Speaker]

With this it will be convenient to discuss the following:

Government new clause 2—Delegation of Welsh Environmental Functions.

Government new clause 3—Shared services.

Government new clause 4—Shared services: Forestry Commissioners.

Government amendments 5, 6, 12 to 20, 7, 21 to 25, 8, 9, 26, 27, 10, 28, 11 and 29.

[Mr Hurd]

This is a long list of amendments, but I hope we can deal with it quickly, as I sense that the mood of the House is in favour of moving on swiftly to what might well be more contentious issues. First however, it would be wrong of me not to join the Deputy Leader of the House in thanking the members of what was a very good Committee for their work and the spirit in which they undertook it.

This group of Government amendments relates to four aspects of the Bill, and to matters which I hope the House will agree are sensible and uncontentious. New clauses 3 and 4 and amendments 25 to 29 will provide powers to enable certain bodies carrying out public functions—specifically the Environment Agency, Natural England and Royal Botanic Gardens, Kew, as well as the Joint Nature Conservation Committee, the Marine Management Organisation and internal drainage boards—to share back-office functions with other bodies. The powers also apply to other bodies carrying out Welsh environmental functions.

New clauses 1 and 2 and amendments 12 and 16 to 20 will provide powers to enable the Environment Agency to delegate non-devolved functions to Welsh environmental bodies. They also incorporate provisions currently in clause 16 relating to delegation of Welsh environmental functions. Amendments 5 and 8 to 11 will extend the definition of “eligible persons” in clause 1(3) to include co-operative and community benefit societies and charitable incorporated organisations. Finally, amendments 6, 7, 13 to 15 and 21 to 24 are minor and technical drafting amendments.

Turning first—and briefly—to the issue of shared services, there is a move across government to reduce the cost of back-office functions such as human resources, IT and payment processing. Freeing up bodies to share back-office services is an important way of rationalising and delivering economies of scale. The Department for Environment, Food and Rural Affairs has some large non-departmental public bodies, such as the Environment Agency, which could serve as centres for delivering back-office services to other bodies in its network. However, these bodies do not currently have clear legal powers to be able to provide such services. That is because providing these back-office services to others is not always incidental or related to their main or primary purpose. The aim of these amendments is to provide a clear power so that, for example, the Environment Agency could provide back-office services such as accounting services to a body such as Royal Botanic Gardens, Kew, or operate contracts for vehicles for the DEFRA network. That would be beneficial in efficiency and economic terms, and there are likely to be many more such examples as sharing of services becomes more common.

[Mr Kevan Jones (North Durham) (Lab)]

I understand why these amendments have been tabled, but it is not a God-given right that the organisations in question will win these contracts. Surely some of the contracts will be sufficiently large to have to be put out under the Official Journal of the European Union—or OJEU—notices.

[Mr Hurd]

That is a separate issue. We are trying to make the powers clearer so that more circumstances arise whereby such bodies can share services and seek efficiencies. These amendments will therefore enable the Environment Agency—

[Mr Jones]

The hon. Gentleman did not answer my question. The fact of the matter is that these measures will give the powers he describes, but they do not necessarily mean that the organisations in question will be able to circumvent European competition law in respect of contracts they put out to tender.

[Mr Hurd]

The hon. Gentleman is right to say that everything will be subject to appropriate procurement regulations, but the purpose of these amendments is to make it easier for such bodies to share services.

These amendments will therefore enable the Environment Agency, Natural England, the Joint Nature Conservation Committee, the Marine Management Organisation and internal drainage boards, which are bodies performing public functions, to provide back-office functions to other bodies carrying out public functions. The Bill already provides a similar power for Welsh environmental bodies, so this step will provide parity for these English bodies.

The amendments also carry forward arrangements in clause 16 whereby forestry commissioners may share services with Welsh environmental bodies carrying out functions in Wales. This power does not extend to the Forestry Commission making arrangements with non-Welsh bodies. As this is an enabling power, it will be used only where a body listed wished to use it, and where it would be financially beneficial to share back-office services. Also, it could not be exercised without the consent of the relevant Ministers. This power is in many respects similar to the provision in the Flood and Water Management Act 2010 enabling internal drainage boards to agree that one should provide back-office services to another. In debate, this was warmly welcomed by all parties. As in the case of these amendments, the express purpose was to make the delivery of administrative functions more effective and cheaper. I hope that right hon. and hon. Members will agree that, with public funding under severe constraints, it is sensible to ensure that bodies are able to share services, thus leading to increased efficiency and potential savings in the delivery of back-office functions.

--- Later in debate ---

[Roger Williams (Brecon and Radnorshire) (LD)]

We have only recently had sight of these new clauses. The water framework directive, which needs to be in place by 2015, deals with river catchment areas and so rivers such as the Wye and the Severn would have both a Welsh and an English context. Do these new clauses enable these bodies to work better together to achieve the desired outcome?

[Mr Hurd]

In large part these measures are designed to make existing flexible arrangements clearer, precisely to make more effective the sort of cross-border work needed in exactly the type of situations to which the hon. Gentleman refers.

As I was saying, the amendments are similar to the current provisions relating to the delegation of Welsh environmental functions in clause 16. The amendments delete those provisions and incorporate them in a slightly revised clause so that the delegation of functions is covered in concurrent clauses.

Amendments 5 and 8 to 11 will extend the definition in clause 1(3) of “eligible persons” to whom the functions of a body or office holder can be transferred under the general order-making powers of the Bill and to whom property can be transferred under clause 24 to include co-operatives, community benefit societies and charitable incorporated organisations. This issue was raised in Committee, not least by my hon. Friend the Member for Dover (Charlie Elphicke), at which point I made a commitment to consider how alternative models such as co-operatives and community benefit societies could be supported to deliver public services, where appropriate. It has always been the intent behind this section of the Bill to ensure that the reform of public bodies is effective by enabling the transfer of functions to a range of persons, so I am therefore pleased to be able to introduce these amendments.

In addition to the provision on co-operatives and community benefit societies, there is now an amendment to include charitable incorporated organisations. Although such charities are yet to come into being since being introduced by the Charities Act 2006, work is well under way and we have taken the opportunity to allow future orders made under the Bill to transfer functions to them. I would like to assure the House that, no matter to whom functions are transferred, it is the Minister’s responsibility to ensure that proper accountability mechanisms are in place, especially where the body is in receipt of public funds.

[Jon Trickett (Hemsworth) (Lab)]

We very much welcome these new clauses, which were amendments that we proposed at the time and the Minister very fairly said that he would take them away and look at them. I wish to raise one issue about charities. Is he able to explain why he is envisaging a particular form of charitable association which is not yet in existence? He has made some brief comments, but they left us puzzled in Committee.

[Mr Hurd]

Charities do fall within the scope of the Bill as far as we are concerned. The hon. Gentleman will be aware that the 2006 Act allowed for the introduction of a new type of organisation—a charitable incorporated organisation. We just felt it sensible at this stage, for the avoidance of any doubt, to include such organisations in the Bill.

I know that the House wants to move on, but let me first address amendments 6, 7, 13 to 15 and 21 to 24. These minor and technical drafting amendments clarify and improve certain aspects of the Bill, and I shall briefly explain the changes they make. The amendments to clauses 11 and 20 are simply drafting changes that move measures that are relevant to the procedure for making orders, which are currently in clause 32, to clauses 11 and 20 as that is where the other measures on procedure are found.

Amendments to clauses 14 and 15 clarify that where Welsh Ministers have powers to modify the constitutional arrangements of bodies, in so far as changes may be made to the extent to which a body is accountable to Ministers, this refers to accountability to Welsh Ministers. The changes to clauses 21 and 23 remove any potential confusion regarding the restrictions in those measures. If a Minister cannot create a power to make subordinate legislation, it follows that he cannot “authorise the creation of” a criminal offence or any of the other powers under clause 21(1). Therefore the removal of the words

“or authorise the creation of”

does not change the effect of the restrictions on ministerial powers.

[Nia Griffith (Llanelli) (Lab)]

Will the Minister explain exactly what consultation he has had with Welsh Government Ministers on the proposals he has outlined this afternoon that will affect Wales?

[Mr Hurd]

I understand that those consultations have been extensive and I do not think there has been any real criticism regarding a lack of consultation with Welsh Ministers. However, I know that there continues to be a spirited debate about S4C and I sincerely hope and believe that we will have adequate time to return to that issue.

The amendment to clause 22 removes what was a restriction on the power to authorise the delegation of functions to an eligible person, as the power to so authorise was removed in the other place. The reference in clause 22(2)(b) is therefore no longer necessary. Finally, the change to clause 27 is simply a drafting change to make reference to each House of Parliament approving a draft statutory instrument rather than a statutory instrument.

[Nia Griffith]

First, it must be said that the Opposition have been dismayed at the way in which the Government have introduced a Bill to abolish so many valuable bodies with so many diverse functions. They have all been lumped together in this one Bill, which has been designed to abolish them, and this has afforded very little time for debate. Although we may accept some Government new clauses and amendments to make the outcome of the Bill fit within the devolution settlement and to iron out some anomalies—we understand that those changes are necessary and logical—that does not mean that we are giving unreserved support to the Bill. Far from it. In other words, we would far rather not be starting from here.

We have been confronted with a large number of new clauses and amendments at this very late stage of the Bill. A more appropriate way of dealing with these measures would have been in Committee, having allowed proper time for consultation and debate. Instead, these Government amendments were published only yesterday morning. As the Welsh Assembly is in recess this week, there has been no opportunity for the Opposition to consult Welsh Ministers. Indeed, even if it were not in recess, there would have been an absurdly short period of time for us to consult those Ministers or anyone else who has an interest in these amendments. Let us contrast that approach with the extensive discussions we had in the Committees on the Bills that became the Marine and Coastal Access Act 2009 and the Flood and Water Management Act 2010 about exactly how functions would apply to Wales.

Let me address the four issues to which the Minister has referred. First, on shared services, we need to remember that this is the Minister who only last October tried to explain to charities that they need not worry about TUPE because it would not apply. We can all appreciate the need for savings and the benefits that sharing staff can bring but I am concerned that the Minister is trying to bamboozle us with this measure. I am worried about his understanding of TUPE and the importance of protecting staff if they have to transfer from one place to another, if their functions are transferred, if their job description is changed or if they find themselves doing something that they were not originally appointed to do. I feel that the Government need to take on board the protection that such people should be afforded.

On the Environment Agency and issues such as flooding, of course we appreciate the need for the most appropriate and efficient way to operate. There is already close co-operation on the ground. If we can remove legal barriers to solving any problem in that respect, that is clearly the correct way forward.

Co-operatives have been mentioned, and of course the Opposition have always championed them.

Finally, the technical amendments are clearly consequential, and we therefore accept them in the context of our opposition to the general thrust of the Bill.

Question put and agreed to.

New clause 1 accordingly read a Second time, and added to the Bill.

New Clause 2

Delegation of Welsh environmental functions

‘(1) A person to whom this section applies may make arrangements with another such person for—

(a) a Welsh environmental function exercised by one to be exercised by the other;

(b) co-operation in relation to the exercise of Welsh environmental functions.

(2) This section applies to—

(a) the Environment Agency,

(b) the Forestry Commissioners, and

(c) a person not falling within paragraph (a) or (b) who exercises a Welsh environmental function.

(3) The Welsh Ministers’ consent is required for arrangements under subsection (1).

(4) The Welsh Ministers may by order make provision about how the function of making arrangements under subsection (1) is to be discharged (including provision about the extent to which a fee may be charged in respect of anything done under the arrangements).

(5) An order under subsection (4) is subject to annulment in pursuance of a resolution of the National Assembly for Wales.

(6) The Secretary of State’s consent is required for arrangements under subsection (1) involving, or an order under subsection (4) affecting—

(a) the Environment Agency,

(b) the Forestry Commissioners, or

(c) a person not falling within paragraph (a) or (b) who is a cross-border operator.’.—(Mr Hurd.)

Brought up, read the First and Second time, and added to the Bill.

New Clause 3

Shared services

‘(1) A person to whom this section applies may make arrangements with any other person to provide administrative, professional or technical services to that person for purposes relating to the exercise of public functions in or as regards England or Wales.

(2) This section applies to—

(a) the Board of Trustees of the Royal Botanic Gardens, Kew;

(b) the Environment Agency;

(c) the Joint Nature Conservation Committee;

(d) an internal drainage board;

(e) the Marine Management Organisation;

(f) Natural England;

(g) a person not falling within paragraphs (a) to (f) who exercises a Welsh environmental function.

(3) The Secretary of State’s consent is required for arrangements under subsection (1) involving a person who exercises a non-devolved function (whether or not the person also exercises a Welsh devolved function).

(4) The Secretary of State may by order make provision about how the function of making arrangements in subsection (1) is to be discharged in the case of arrangements made by a person to whom this section applies who exercises a non-devolved function.

(5) An order under subsection (4) requires the consent of the Welsh Ministers if the person referred to in subsection (4) also exercises a Welsh devolved function.

(6) An order under subsection (4) is subject to annulment in pursuance of a resolution of either House of Parliament.

(7) The Welsh Ministers’ consent is required for arrangements under subsection (1) involving a person who exercises a Welsh devolved function (whether or not the person also exercises a non-devolved function).

(8) The Welsh Ministers may by order make provision about how the function of making arrangements in subsection (1) is to be discharged in the case of arrangements made by a person to whom this section applies who exercises a Welsh devolved function.

(9) An order under subsection (8) requires the consent of the Secretary of State if the person referred to in subsection (8) also exercises a non-devolved function.

(10) An order under subsection (8) is subject to annulment in pursuance of a resolution of the National Assembly for Wales.

(11) The provision referred to in subsections (4) and (8) includes provision about the extent to which a fee may be charged in respect of anything done under the arrangements.

(12) The power to make arrangements under subsection (1) is without prejudice to any other power of a body to which this section applies to provide services to other persons.’.—(Mr Hurd.)

Brought up, read the First and Second time, and added to the Bill.

New Clause 4

Shared services: Forestry Commissioners

‘(1) The Forestry Commissioners may make arrangements with a person who exercises a Welsh environmental function (with or without other functions) to provide administrative, professional or technical services to that person for purposes relating to the exercise of public functions in or as regards Wales.

(2) The Welsh Ministers may by order make provision about how the function of making arrangements under this section is to be discharged (including provision about the extent to which a fee may be charged in respect of anything done under the arrangements).

(3) An order under subsection (2) is subject to annulment in pursuance of a resolution of the National Assembly for Wales.

(4) The Secretary of State’s consent is required for—

(a) arrangements under this section, or

(b) an order under subsection (2).

(5) The power to make arrangements under this section is without prejudice to any other power of the Forestry Commissioners to provide services to other persons.’.—(Mr Hurd.)

Brought up, read the First and Second time, and added to the Bill.

New Clause 7

Agricultural wages

‘(1) In section 3 of the Agricultural Wages Act 1948 (power of Agricultural Wages Board to fix wages, holidays and other terms and conditions) the powers and duties of the Agricultural Wages Board are transferred to the Low Pay Commission.

(2) The Low Pay Commission shall establish an advisory board of employer and employee representatives from agricultural and related industries to make recommendations to the commission in fulfilment of its duties under the Agricultural Wages Act 1948.’.—(Andrew George.)

Brought up, and read the First time.

--- Later in debate ---

[Mr Hurd]

On a point of order, Mr Deputy Speaker. It would be helpful to inform that House that, having considered the matter further, the Government will not move amendments 47 and 48.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I thank the Minister for that notification.