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Lords Chamber

Volume 685: debated on Thursday 26 October 2006

House of Lords

Thursday, 26 October 2006.

The House met at eleven of the clock: the LORD SPEAKER on the Woolsack.

Prayers—Read by the Lord Bishop of Peterborough.

Parliament and the Constitution: Public Information

Lord Higgins asked Her Majesty’s Government:

Whether they have any plans to improve the information which they provide about Parliament and the constitution.

My Lords, we have funded the production of a Citizenship Foundation publication, Inside Britain: A Guide to the UK Constitution, which was launched on 10 July of this year. Copies have been sent to all secondary schools in England and Wales and to further education colleges.

We are also funding a number of other projects that are intended to support the education community in its commitment to explain how our parliamentary democracy works. These include six booklets which are being published by the Hansard Society and the production of a CD by the Hansard Society with the Association of Citizenship Teachers called “Big Ben and All That”.

My Lords, I thank the noble and learned Lord the Lord Chancellor for that extensive reply. Does he agree that it is very important that information on Parliament and the constitution should be unbiased and accurate, especially information provided to schools and those applying for citizenship? The documents provided to schools are not at all bad, but the document produced apparently by the Home Office, Life in the United Kingdom, A Journey to Citizenship, is full of the most appalling errors and is grossly misleading. For example, it states that after 1945 “unemployment vanished”. And, under a heading, “The Thatcher Era”, it states:

“The Conservatives won the general election of 1979 and stayed out of office until 1997”.

Does the noble and learned Lord agree that not only would someone applying for citizenship and paying £9.99 for this document have wasted their money but they might well have jeopardised their chance of being accepted for citizenship?

My Lords, on the issue of unemployment, the document should have said, “after 1997 unemployment vanished”. As to what happened between 1979 and 1997, obviously the author was writing about his hopes, rather than what actually happened.

Of course, accuracy is incredibly important in relation to what is said. I am grateful for the noble Lord’s comments about the material provided to schools. It is extremely important that schools are told about how our constitution and our Parliament work, because that is how our values are embedded—and that is important at the moment. I will take up all of the noble Lord’s points about the inaccuracies in the Home Office document.

My Lords, I am not sure to which figures the noble Lord is referring. The Home Office is not a figures department; it is much more a generality department, so there probably are no figures in the document.

My Lords, can the noble and learned Lord the Lord Chancellor say whether a copy of all this material has been sent to Mr Jack Straw, who seems somewhat ignorant on matters of the constitution, judging from recent leaks about his intentions?

My Lords, talking about Lords reform in the House of Lords is always a bit of a hospital pass, I feel. We should continue our search for consensus. As for the comments of the noble Lord, Lord Tebbit, on historical material, in my experience, there is no one more experienced in history than the Leader of the House of Commons.

Baroness Walmsley: My Lords, is the noble and learned Lord aware that the Life in the United Kingdom booklet to which the noble Lord, Lord Higgins, referred and the Life in the UK website offer aspiring UK citizens no further educational resources? Yet, here in Parliament, we have the excellent Parliamentary Education Unit, which produces books and videos that are mainly directed at young people and would be perfectly suitable for immigrants to look at. It has also an excellent website called “explore Parliament”. Would it not be sensible for the Life in the UK website at the very least to have a link through to the Parliamentary Education Unit website, so that it would be easy for aspiring new citizens to access those excellent educational materials?

My Lords, I agree entirely that the work done by the Parliamentary Education Unit is absolutely first-class. I also agree that, if there were links between that website and the Life in the UK website, that would be beneficial. I shall see whether that can be done.

My Lords, should not some information be provided clarifying the law on privilege following the extensive argument that took place last week among lawyers about whether a proceeding in Parliament on a Question on rape should be transmitted or published? I understand that some television companies bleeped on an unprecedented scale that proceeding in Parliament and lawyers blocked copy in national newspapers. Is there not now a need for clarification in some form of publication, and will my noble and learned friend consider writing to Members of the House on this matter?

My Lords, that is a bit far from the Question, but it is a very important issue. I shall not refer to the specifics of the matter raised by my noble friend Lord Campbell-Savours, but Parliament has privilege so that there can be free debate in Parliament. There is no point in free debate in Parliament if the free debate is then kept secret by the media.

The purpose of the privilege rule is that, so long as there is an accurate account of what is said in Parliament, it can then be broadcast or put in national newspapers. If the account is biased or unfair, that is not right. If you name someone, as in the example given, then, so long as the context is set out fairly, there is no legal restriction on it being published. We need to look at that. My noble friend Lord Campbell-Savours is absolutely right to say that it would appear from some elements in the media that the conclusion reached by the lawyers was that, because it would not have been privileged if it had been said by someone outside Parliament, a fair account of it could not be given in Parliament. The best example of that is that those proceedings were not even broadcast on the BBC Parliament channel, and that could not have been a fairer account of what happened. So I think that we need to look at the matter and that a definitive account of parliamentary privilege needs to be given in both Houses of Parliament.

My Lords, I will return to the Question. The document referred to by my noble friend does not just contain inaccuracies; it has fundamental mistakes. I shall give one example—certainly it gets worse for the Members opposite:

“Labour under Harold Wilson returned to power from 1964 to 1970 and again from 1974 to 1979”.

Thus, Jim Callaghan is completely written out of history. That is a classic example of why history—not citizenship—should remain compulsory for all pupils to the age of 16. If the Home Office cannot get it right, who can? Unless we have a solid grounding in history, how can we begin to understand and build citizenship?

My Lords, I agree entirely about the importance of history. If the Home Office is not adequately referring to Mr Callaghan, that is of deep and profound regret. I see the noble Lord, Lord McNally, nodding enthusiastically, because he was a part of that. Sadly, my noble friend Lady Jay of Paddington is not in her place, but the omission of Lord Callaghan is terrible.

Russia: Anna Politkovskaya

asked Her Majesty’s Government:

Whether they will make representations to the Government of Russia concerning the case for a full investigation into the murder of the journalist Anna Politkovskaya.

My Lords, the Prime Minister, Foreign Secretary and Minister for Europe have all called for a thorough investigation into the murder of Anna Politkovskaya. EU leaders repeated this call during their meeting with President Putin at the Lahti summit on 20 October. The Russian prosecutor-general has taken charge of the criminal investigation, which I hope will bring those responsible for this terrible and troubling crime to justice.

My Lords, I thank the Minister for that Answer, but I am not wholly persuaded by it. Over the past six years, no fewer than 12 journalists have been murdered in Russia. In not a single case has anyone been brought to justice. What representations have the Government made in those previous cases, and why does the Minister have so much confidence that this one will be resolved?

My Lords, let me start by saying that I am not confident that it will be resolved, but I expect to see a serious attempt to resolve it. We have had regular, open and frank discussions with Russia on human rights and the murders of other journalists; we routinely have such discussions through structured EU and bilateral dialogues and through ongoing contact at all levels with the Russian Administration. FCO Ministers have met a number of Russian NGOs as well this year and discussed their and our concerns with Russian Ministers. We fund, through the FCO, projects to provide financial support to the NGOs that are involved in the training and work of journalists.

My Lords, Anna Politkovskaya most annoyed the formal and informal powers that be in Russia in her reporting of events in the north Caucasus—in Chechnya, in particular, but also in North Ossetia, South Ossetia and elsewhere. Are the Government doing their best to ensure that the deep corruption of the Russian army, which she exposed, and the appalling behaviour of the local authorities throughout those troubled republics are not lost sight of, that the OSCE continues to pay attention to them, that the Council of Europe, of which Russia is a member, continues to cover them, and that we do not allow the Russian authorities to continue to behave in such an appalling way in that region?

My Lords, we try to exert as much influence as we can in routine meetings and special bilateral meetings on all these issues. We also do our best to ensure that the Council of Europe’s decisions are binding on Russia, as they are on all others. I may stand corrected on the figures, but I think that there are nine outstanding issues still to be resolved. We will not stop in this argument. Human rights are a fundamental issue and are raised at every opportunity.

My Lords, many will notice that the Russian authorities do not welcome independent voices on the Chechnya issue, on which Anna Politkovskaya was working at the time of her death. We have given a lot of support in the past to freedom of the press in Russia through the British Council and through the Know How Fund, and the Reuters Institute for the Study of Journalism is about to open in Oxford. Can my noble friend tell us that we will continue to encourage—indeed, that we will expand the encouragement and support that we give directly to—Russian journalists who are working for freedom of the press in that country?

My Lords, I give that assurance straightforwardly. It is part of our forward programme and has to remain part of it. The burden of the issues raised by the noble Lord, Lord Giddens, in his Question shows why that is the right thing to do.

My Lords, does the Minister agree also that the worrying reduction of the freedom of the press in Russia continues apace, not only in these tragic murders, which have to be investigated, but in incidents behind the scenes, including much harassment of journalists all the time? The legislation in the Duma is inadequate for the real protection of a free press, which is essential to expose criminality and wrongdoing, as well as terrorism. What will the Government do to make the extra points to convince the Russian Government of the need for new legislation in the Duma?

My Lords, in the discussions that I have described, which go on consistently, Ministers and officials have tried to emphasise that across the whole canvas of human rights there needs to be real development and a cessation of the push-back against many of the NGOs—certainly, in the areas of journalism and freedom of the press, that could not be clearer. We will continue to argue that human rights dialogue is absolutely vital. There has been progress in some areas, and it is critical that that does not slip back.

My Lords, the noble Lord, Lord Giddens, is right to imply that the record on the murder of outspoken journalists in Moscow and Russia is miserable. Will the Minister keep us up to date with the progress that he and his colleagues make in ensuring that human rights values are upheld in the Russian Federation? We all recognise that Russia is a difficult place to govern. I am sure that he is aware that a $1 million reward is out for any information about the murder of this lady. One of the Moscow newspapers said that she,

“looked evil straight in the eye”.

Unfortunately, of course, she looked evil in the eye and ultimately lost the battle for her life. Does the Minister accept that that is a fine epitaph to an obviously wonderful crusading journalist?

My Lords, I do. I am horrified by the murder, as I suspect all Members of the House will be. It was described by Vladimir Putin as a crime of loathsome brutality, although I must say that he went on to say that he did not believe that she had had a huge impact. We have said that it is a terrible crime. My right honourable friend the Prime Minister has said that we condemn the murder and call for a thorough investigation into it. We will continue our work. As I said, we are supporting NGOs working to promote media freedom. This year, we have supported a project with the International Federation of Journalists and the Russian Union of Journalists to promote media independence and capacity. I make that point because it is incumbent on us, apart from deploring a loathsome crime, to support those who carry on the fight for which she gave her life.

Organophosphates

asked Her Majesty’s Government:

When a decision will be taken on the future of the ongoing investigation into the neuropsychological sequelae of organophosphate poisoning caused by sheep dip, commissioned by the Department for Environment, Food and Rural Affairs in 2002.

My Lords, officials from my department recently met contractors from University College, London, and the Veterinary Products Committee’s medical and scientific panel to discuss concerns about the scientific viability of the project. We have recently received, on 20 October, the panel’s written appraisal of the contractor’s proposed approach. A decision will be taken once the advice has been considered.

My Lords, I am grateful to the Minister for that reply, but I am sure that he is aware that the hundreds of victims of organophosphate poisoning will be disappointed at the lack of progress.

As I hope the Minister is also aware, successive Ministers in successive Governments have constantly said to these unfortunate people that more research is needed. Can he explain why this has been drawn out for so long? In particular, why have the concerns been raised at this late stage in this important study by UCL? Why were they not raised much earlier? Finally and most importantly, can the Minister really accept that the misery of the many organophosphate victims is less important than the millions that have been made by multinational chemical companies? Which side are the Government on?

My Lords, reading the briefing for this took me back a few years, when I was dealing with this matter and the noble Lord came to see me—as, I suspect, did the next questioner. The delay has been unforgivable.

I shall be happy to see the noble Lord and arrange for him to see officials. I know he came into the department 18 months or two years ago. One of the key issues causing problems with the contractor’s proposed approach to this part of the study has been the inability to put together a control group. I have not seen the advice that came in last Friday; it is being looked at for advice to the Minister, Ben Bradshaw. There has been a complete inability to find a control group of, for example, sheep farmers who have retired away from farming, because farmers tend not to retire in that sense. That has been a central cause of the delay.

Given the chronology of this—the years it has gone on for—it is unforgivable. It is bound to lead to suspicions on the part of those who think that there is a connection between organophosphates and ill health that there is lethargy in the department. The issue must be cracked once and for all, but we need better scientific evidence than we have at present.

My Lords, the Minister was right to assume that I would be the next to ask him a question. Can he explain why MAFF, as it then was, spent four years negotiating with the main contractor? The design was agreed with in-house scientists and independent external reviewers. They have been offered 12 different groups for controls, which have been turned down.

Why, on every occasion that sheep dip research has shown that there are problems with organophosphates and sheep farmers, has the medical and scientific panel criticised the control groups? There was the Institute of Occupational Health in Birmingham, the Institute of Occupational Medicine in Edinburgh and now this. Is it not time they got it right?

My Lords, I have every sympathy with the noble Countess’s approach. The only good thing that I discovered when I returned to the issue after some years was that the work done in the late 1990s and early 2000s on the containers used for OPs was successful in that you cannot buy them now unless you have a certificate. The containers separate the product from the person. Following their introduction, there has been only one report of an acute adverse reaction in a human to OP sheep dips. To that extent, progress has been made, but it does not help those who believe that they are suffering an illness as a result of OPs.

The situation is complicated further because the alternative to OPs—Cypermethrin, a synthetic pyrethroid—kills fish because sheep shake themselves after being dipped. It has been withdrawn, so, at present, there is no alternative to OPs. However, the matter must be looked at further, and I will be happy to see the noble Lord, Lord Tyler, and the noble Countess, Lady Mar.

My Lords, does the present study take into account the transfer of residues of OP compounds or their metabolites through the food chain to humans and wildlife?

My Lords, I cannot say. The study is not up and running because of the inability to get a control group. I have seen no evidence that there is any risk to the food chain. There is a lot of surveillance of our food, so it would have been picked up.

My Lords, I congratulate the noble Countess, Lady Mar, and my noble friend Lord Tyler on their wonderful efforts on this over a very long time. Is it not the case that the chemical companies, and perhaps Defra itself, are afraid of legal suits in relation to the poisoning that is occurring? For noble Lords who do not know, organophosphorus was used in nerve gas in the First World War. I believe that thousands of upland farmers and shepherds have been affected by depression and physical decline. Will the Minister make a commitment that the report that is commissioned will be published within a finite time so that we all know the results? What research and development have been done on alternatives to OPs and the products to which he has just referred, which seriously injure people’s health on the one hand and destroy the aquatic environment on the other?

My Lords, I said that it is alleged that OPs affect people’s health. However, their use is widespread: I understand that there has recently been concern because they are used as lubricants in the oil used in aircraft engines. There have been allegations that aircraft cabin crews have been affected. I understand that work is happening on that, but it is not part of this exercise. As to the report, the difficulty is getting the work commissioned because I do not think it will be undertaken without an adequate control group. That will be the substance, I think, of the advice given to Defra. I do not know what advice the medical and scientific panel gave.

This has to be followed through. I told my officials this morning and will tell my ministerial colleague that this issue will not go away. On the other hand, we cannot necessarily blame the manufacturers. Their product was looked at and okayed for the market. A lot of controls about who can purchase it, who can use it, how it is used and how it can safely be disposed of were put on it to keep it away from human contact. However, that does not alter the fact that there is a problem. The good thing is that since the containers were changed there has been only one report of an adverse human reaction.

G6: Ministerial Meeting

asked Her Majesty’s Government:

What subjects were on the agenda at the G6 Interior Ministers’ meeting in Stratford-upon-Avon on 25 and 26 October; and whether they will place in the Library of the House copies of any papers which were discussed.

My Lords, my right honourable friend the Home Secretary is currently chairing the meeting of G6 Interior Ministers, which he opened yesterday. He plans to discuss a range of issues relating to counterterrorism, organised crime and migration. The meeting will close at lunchtime today with a press conference. The conclusions of the meeting will be published on the Home Office website and placed in the Library of the House.

My Lords, I am grateful to the Minister for that reply. She will be familiar with the document in my hand, which is described as,

“Behind Closed Doors … at Heiligendamm”.

It sounds like a thriller. In fact it is our European Union Committee report on the so-called G6 meeting there. First, is the Home Office fully alive to the strictures in the report about a lack of accountability and transparency? Secondly, will she say something about the linked and very sharp criticism made of the impact of G6 decisions on smaller European Union countries that is encapsulated in the phrase:

“The G6 should recognise that they are not the Europe des Six”,

which I suppose is Franglais?

My Lords, first, I reassure the noble Lord that we are very alive to the strictures in the report. Secondly, there is no suggestion whatever that the G6 group is the major driver of the European movement. It is an informal group that meets to discuss matters of real interest that are openly shared with all members of the Union. The conclusions are shared also. I should make it clear that it is not a decision-making body; it is an opportunity for those six member states to discuss from time to time openly and transparently matters of mutual interest and concern.

My Lords, does the Minister agree that the conclusions reached at these meetings influence the work of the Commission? Is it right, therefore, that small groups should have such an influence on the whole of the EU, now of 25 members? Perhaps I should say that I sat on that committee and obviously contributed to the report.

My Lords, the issues that the G6 group is debating concern the whole of Europe. There is no direct correlation with the subjects discussed in those meetings and consequent changes made by the Commission. We genuinely think that it is an initiative that has been welcomed by all. It helps to raise issues. Those issues are taken to the whole of the Council, and all member states have an equal part in any final determination or shape that emerges from those discussions.

My Lords, I also declare an interest as a member of the committee to which the noble Viscount referred. At the meeting in Stratford, will any proposals be made on the important subjects of counterterrorism, organised crime and migration? The account in the Guardian this morning says that carousel fraud is also being discussed. Will proposals be put to the G6 meeting at Stratford that could result in decisions by European Union bodies? If so, does the noble Baroness agree that there has to be proper consultation with the other 19 states, otherwise such meetings could turn into a harmful device for the Union of Europe as a whole because the other 19 will feel excluded from that process?

My Lords, I need to make it absolutely clear, if I have not already done so, that the discussions do not involve formal proposals. They are a vehicle through which discussion can take place. Issues of concern for the whole of Europe may be identified. If they are, they will be brought before all member states so that they can be considered and decisions can be taken. No power is vested in this informal group meeting, so no additional importance is to be given to it over and above that given to the diverse informal meetings between different groups of member states from time to time. The noble Lord will know, as will the House, that there are several informal groupings of member states, and healthy bilateral relations continue.

Business

My Lords, with the leave of the House, a Statement on a local government White Paper will be repeated later today by my noble friend Lady Andrews at a convenient time after 12.45 pm.

Legislative and Regulatory Reform Bill

Report received.

Clause 1 [Power to remove or reduce burdens]:

Page 1, line 6, leave out “he considers”

The noble Lord said: My Lords, Amendment No. 1 is grouped with Amendments Nos. 11 and 13, in my name and that of my noble friend Lord Maclennan of Rogart. Clause 1(1) provides that:

“A Minister of the Crown may by order under this section make any provision which he considers would serve the purpose in subsection (2)”.

Subsection (2) says:

“That purpose is removing or reducing any burden, or the overall burdens, resulting directly or indirectly for any person from any legislation”.

The amendment would remove from Clause 1(1) the words “he considers”, so that Clause 1(1) would read:

“A Minister of the Crown may by order under this section make any provision which would serve the purpose in subsection (2)”.

In other words, this turns the test for the validity of the order from a subjective test to an objective one.

Under the subjective test in the Bill, the order, which is of course secondary legislation and therefore subject to review by the courts, can be quashed by a court on judicial review if, but only if, the Minister is acting irrationally, so that no reasonable Minister, who would properly consider the relevant information, could have concluded that the order would serve the purpose in subsection (2). Under an objective test, the order could be quashed if the court was satisfied that, on the balance of probabilities, the order would not serve that purpose, even though the contrary view may be arguable.

The Bill gives Ministers a wide power to legislate by order, with a restricted parliamentary process and no opportunity to amend the draft order apart from forcing the Government to withdraw a draft order and produce a revised order. The Bill, in its initial stages, was extremely controversial, and I accept that the Government have introduced new checks into the Bill to help to prevent abuses of powers. Owing, however, to the unusual nature of the powers conferred by the Bill, the further check that Amendment No. 1 would provide is needed. The test should not be whether the Minister’s view is daft, but whether, when looked at dispassionately, it is predictable that the order will more likely than not satisfy the purposes in Clause 1(2). That seems to be the proper test.

Amendment No. 11 applies the same principle to the order made under Clause 2, which is in a very similar form, and the same reasoning applies. Amendment No. 13 applies similar provisions in relation to Clause 3, which contains five provisions at present that have to be satisfied before the procedure under the Bill can be used. Those conditions are plainly essential to prevent an abuse of powers under this Bill. For that reason, I believe that having an objective test is even more important in relation to Clause 3 than it is to Clauses 1 and 2. I note that Section 3 of the Regulatory Reform Act 2001, which provides similar conditions to the conditions under Clause 3(2)(c), (d) and (e), contained a subjective test, but the powers under the 2001 Act were considerably more limited than the powers under this Bill.

Further, the Government intend to introduce Amendment No. 14, which will add a further condition that,

“the provision is not of constitutional significance”.

I will strongly support Amendment No. 14, but I believe that what is of constitutional significance is plainly a matter for the decision of judges rather than for the opinion of Ministers. It will not be an easy question to decide with a constitution as flexible and as uncertain as ours. Decisions on what constitutes matters of constitutional significance will need to be consistent, based on full argument by experts and with written judgments to which access can be had. It is inappropriate to leave this matter to the decisions of Ministers who may have different views. I believe that the case for all three of these amendments is strong. I beg to move.

My Lords, I support the amendment. I spoke to it in Committee and there is nothing I wish to add. I look forward to the Minister developing a fuller response than he did in Committee, which was focused on the parliamentary process rather than on the points that were raised by the noble Lord, Lord Goodhart, the noble and learned Lord, Lord Lloyd of Berwick, and my noble friend Lord Onslow. The noble Lord, Lord Goodhart, has touched on points to which I shall return in a later amendment, which I do not want to rehearse here. I endorse everything that the noble Lord, Lord Goodhart, has said and agree with the propositions that he has advanced.

My Lords, in Hansard of Monday 3 July, I supported the amendments proposed by the noble Lord, Lord Goodhart. I do so again for the reasons set out in col. 24 of that date.

My Lords, we return to familiar territory and a debate which the noble Lords, Lord Goodhart and Lord Norton of Louth, sponsored at an earlier stage of the Bill. Obviously, we have had time to reflect and give the matter further consideration. For an order to be laid under Clauses 1 or 2, the Minister must consider that it serves the purpose outlined in Clause 1(2) of,

“removing or reducing any burden, or the overall burdens, resulting … from … legislation”,

or Clause 2(2) to secure that,

“regulatory functions are exercised so as to comply with the [five] principles”,

of better regulation. The Minister must consider that any provision under Clause 1(1) or 2(1) that does not merely restate an enactment satisfies the preconditions in Clause 3(2) whenever they are relevant.

The effect of this is not to reduce in any way the onus on the Minister to base his decisions on reasonable opinion. We contend that these tests are real ones because the Minister is under a public law duty to be reasonable when forming a view of whether or not the provisions of an order are within the terms of the order-making powers in Clauses 1 and 2 and meet the preconditions in Clause 3(2). The effect is, however, to retain what is in the Government’s view the right balance between the judgment of the Minister and Parliament, and the power of the courts. The Government are firmly of the opinion that this balance is for Parliament to decide on the basis of detailed information submitted by the Minister regarding whether any proposed order will deliver appropriate regulatory reform and meets the preconditions in Clause 3, and for the courts to step in only in the unusual instance that a Minister has breached his public law duty to be reasonable in his opinion.

In Committee the noble Lord, Lord Goodhart, acknowledged that it is well established law that the Minister’s opinion can be quashed by the courts if it is found to be irrational, and that argument has been repeated this morning. If this amendment were to stand part of the Bill, however, the courts could override both the Minister and Parliament about whether an order is for the purposes set out in Clauses 1 or 2 and meets the preconditions in Clause 3. The noble Lord, Lord Borrie, is not with us today, but in Committee he argued that this cannot be right, and in his words would,

“elevate judicial accountability over political accountability. That would be quite inappropriate”.—[Official Report, 3/7/06; col. 21.]

I put it another way: it would subcontract out constitutional matters to the courts, and I ask simply whether that is the right policy approach.

As the Delegated Powers and Regulatory Reform Committee appears to agree in its notable report on the Bill, the Government believe that the effect of the reference to ministerial opinions does not in any way weaken the requirement for the Minister’s opinion to be reasonable and subject to rigorous challenge. It simply ensures that the detailed challenges and decisions over, for example, what constitutes a necessary protection in a particular case or how to balance the removal of an obstacle to productivity against an increase in financial costs for some are judgments which should be made only by a Minister, subject of course to Parliament’s agreement. They should not themselves be matters on which the court can substitute the opinion of the Minister and Parliament with its own judgment. It seems to me as a Minister that this is right. It is appropriate that relevant parliamentary committees make judgments about whether a particular order meets these tests and, as the Commons Regulatory Reform Committee puts it, about matters some of which are essentially political, while the court should be empowered to do so only on extreme—to be reasonable and fair—and very rare occasions when the Minister may have disregarded the public law duty to be reasonable in his opinion. The courts should not be able to substitute the Minister’s opinion with their own.

Noble Lords asked in Committee whether there is any reason why this subjectivity is more significant now than in the Regulatory Reform Act 2001. The Government believe that there is a reason. The Minister, exercising the power under Clause 1, must now assess financial and economic issues, along with the rebalancing of costs based on risk analysis, for example. In this Bill we are now talking about economic, financial and other practical analyses of what constitutes a burden and what is proportionate inspection and enforcement rather than legal burdens which can be more readily identified by lawyers from the face of enactments as the 2001 Act required.

It is not for lawyers or the courts to decide whether orders are intra vires. So retaining the subjective opinion is even more important to ensure that the right balance is maintained between on the one hand the judgment of the Minister and Parliament, and on the other, the power of the courts. The important preconditions in the Bill relating to necessary protections, rights and freedoms have of course been taken over from the 2001 Act. In each case the 2001 Act provides that an order could be made if the Minister making it is of the opinion that it did not remove necessary protections, rights or freedoms from people which they can rightly and reasonably expect to keep. The existing limitation on the order-making power in Section 3 of the 2001 Act concerning fair balance is also a matter on which the Minister is required to have the necessary opinion.

Indeed, it is right that the preconditions in Clause 3(2) follow that precedent and are subjective. Whether or not the provision made by order, taken as a whole, strikes a fair balance between the public interest and the interests of anyone adversely affected by it is essentially, we argue, a matter of judgment; it is certainly not a matter of objective fact. It may also be worth noting that the 2001 Act permits the making of such consequential or transitional provision as the Minister thinks appropriate—a subjective test rightly mirrored by the subjective tests in Clause 1(8) and (7) of the Bill.

Parliamentary committees can require an order to be subject to the super-affirmative procedure, if it is not already, and can recommend that a Minister should make specific amendments. Ultimately, if Parliament’s disagreement with the Minister’s view is insurmountable, it has a statutory right to veto an order if it does not agree with the Minister’s opinion. That is a powerful veto. The Government have also given an undertaking that they will not force through orders in the face of opposition from Parliament.

These procedural safeguards further ensure that orders will not deliver inappropriate reform. We argue that it is for Parliament to hold us to account, not the courts. We think it is right that essentially political decisions on policy matters should be located there and not within the courts—but, of course, with the public law test of reasonableness firmly in place.

For those reasons, and to protect the interests of Parliament, we argue that the noble Lord should withdraw the amendment.

My Lords, I have always accepted that the subjective test is a real test but, equally, it is plainly not as strong a test as an objective test. The Minister has based a good deal of his argument on the proposition that the amendment would enable the courts to override a Minister and Parliament, but they can do that anyway. It has always been recognised that secondary legislation can be quashed even if it is an affirmative instrument which has received parliamentary attention. This goes way back in history because only primary legislation is exempt from review by the courts. So, therefore, whether or not these amendments are accepted, the judges will have potentially the ultimate decision.

We are concerned here with a much more limited question—that is, whether the test should be a subjective or objective one. For the reasons I gave in opening the debate on these amendments, I believe that it should be an objective test. I wish to take the opinion of the House.

Page 1, line 8, at end insert “in the exercise of a regulatory function”

The noble Lord said: My Lords, as the noble Lord, Lord Goodhart, mentioned, the Bill had a very inauspicious start in another place. It aroused widespread suspicion and was christened by some as the “Abolition of Parliament Bill”. The Government have now wisely and quickly recognised that, despite earlier attempts to legislate in this way by order, this Bill was not going to get through Parliament. Nevertheless, because that was its origin, one has to look at what is left of the Bill—the Government have introduced it in the Lords in a substantially modified form—with extreme care and some suspicion. Even with the amendments that the Government have made or will make, this is still effectively a ministerial law-making Bill and Parliament must look extremely carefully at the powers conferred and their purpose.

Ministers are relying altogether too heavily on the limited safeguards built into the Bill, such as the vetoes of Committees of either House and the Government’s undertakings, which they have given fairly freely, about what they intend to do with the Bill. But undertakings do not bind successive Governments. The Bill will be on the statute book for all successive Governments, and we need to make certain that its wording and purpose are clearly defined so that it is clear what orders are to be permitted under the Bill. Therefore, I suggest that we include a provision that the purpose is to deal with regulatory functions, as defined later in the Bill.

The amendment would restrict the Bill to the exercise of regulatory functions. It is important that this should be recognised in the Bill as its purpose. I regard the amendment as very important, and I hope that the Government may be persuaded to accept it. If not, perhaps we may have to return to the matter. Why not put in the Bill what the Government have said in their oral undertakings to this House—that the purpose is to deal with regulation? I beg to move.

My Lords, I support my noble friend’s amendment. Like my noble friend, I am extraordinarily puzzled as to why the Government have not chosen to constrain Clause 1(2), as he suggests. I can see from Clause 1(4) that there is such a constraint in relation to,

“any burden which affects only a Minister of the Crown or government department, unless it affects the Minister or department in the exercise of a regulatory function”.

I am bewildered as to why the Government have chosen to constrain the situation in respect of a Minister but not in respect of other non-ministerial bodies. That distinction in the Bill is irrational and dangerous, because it will give non-ministerial bodies the power to interfere in areas beyond regulatory matters.

My noble friend Lord Jenkin has produced an extremely elegant solution to this problem by adding a few words in Clause 1(2) which constrain all other bodies in the same way as the power in Clause 1(4) is constrained.

My Lords, the noble Lord, Lord Jenkins, explained to your Lordships' House as he saw it what the effect of the amendment would be. We understand it slightly differently from the noble Lord; we think that the amendment would make it possible to remove or reduce burdens only from those exercising regulatory functions. Burdens could be removed only from regulators. This would exclude cutting red tape for the regulated, businesses, small and medium-sized enterprises and others that make up the essential backbone of the UK economy, and the voluntary and the charitable organisations that contribute so much to society. The noble Lord, Lord Kingsland, says it is an elegant solution, but its effect would be quite widespread. The Government are committed to removing and reducing burdens from the regulated, not just from regulators. For those reasons, we have to resist the amendment.

Perhaps the noble Lord has another effect in mind for the amendment. The intended effect may be to restrict the order-making power in Clause 1 so that burdens can be removed or reduced only if they result from the exercise of regulatory functions. If that is the intended effect, I would again want to resist the amendment for the following reasons. It would be a substantial and, in our view, arbitrary restriction on the order-making power in Clause 1, as it would be used to preclude the removal or reduction of burdens in legislation that did not result from the exercise of a regulatory function. For the purposes of the Bill Clause 32 defines regulatory functions, and I assure the House that there are areas of the law that impose burdens for those businesses—I mentioned voluntary and charitable organisations before—that do not result from the exercise of a regulatory function. That is illustrated by the fact that many of the legislative reforms made by the regulatory reform order under the 2001 Act, which have delivered substantial savings to the United Kingdom economy, would not have been possible if this amendment had applied.

I give an example. The regulatory reform order, which removed a law dating from the 19th century that arbitrarily restricted professional and other groups from forming partnerships of more than 20 people, would not have been possible. That order was sought by stakeholders, passed by Parliament, led to savings of £10,000 per relevant partnership and contributed, in our view, to the competitiveness of the United Kingdom economy. This amendment would have precluded the delivery of the reform, because the burden on business did not result from the exercise of a regulatory function, but from 19th-century legislation.

Another regulatory reform order, which modernised and streamlined procedures for renewing or terminating business tenancies, and led to estimated savings to business of about £19 million a year, would also not be possible if Clause 1 were amended in the way the noble Lord, Lord Jenkins, suggests. Again, the reason for that is that the burden reduced resulted not from the exercise of a regulatory function but from legislation that imposed requirements no longer considered necessary.

Looking to the future and the further reform identified as necessary to boost UK competitiveness, the Department for Trade and Industry hopes to repeal the Limited Partnerships Act 1907 and amend the Partnerships Act 1890, in order to provide much-needed clarity regarding the law on limited partnerships, which are the dominant investment vehicle used in the UK for venture capital and private equity investment funds. It is estimated that private equity investment accounts for 1.1 per cent of UK GDP, with businesses backed by private equity employing some 3 million people. Clarifying the law on limited partnerships is therefore expected to have a substantial and positive impact on investment capacity in the UK, and on the competitiveness of the economy as a whole.

Business has sought this reform to ensure that limited partnerships remain attractive vehicles for venture capital investment in the UK in an increasingly competitive market. Businesses have told us that they believe these reforms will maintain the UK’s pre-eminent position within Europe. The reform is likely to have a substantial and positive effect on our competitiveness, precisely the kind of reform orders we should be able to deliver. Yet the noble Lord’s amendment would preclude any such reform, because again in this instance the burden is neither on a regulator nor from the exercise of a regulatory function, but the result of outdated legislation. If I have properly understood the intended effect of the amendment, such reforms, despite their clear benefit to our economy, would not be possible because they remove burdens arising from legislation and not from the exercise of a regulatory function or from a regulator.

In summary, either of these restrictions would be arbitrary and would preclude a Minister from reducing or removing burdens that were sensible, desired and sought by business and by those in the voluntary and charitable sector. So, for those very practical, hard-nosed reasons, which could have a serious consequence if we were to go down this route, and notwithstanding the elegance of the amendment, I invite the noble Lord, Lord Jenkins, to withdraw it.

My Lords, if the noble Lord had been kind enough to pronounce my name correctly, I would have much more sympathy with what he is saying. It has no “s” on the end.

I have listened to the Minister with care and I think he is construing regulatory functions altogether too narrowly. I would have thought all the examples that he has quoted are of statutory regulation. He quoted the Partnerships Act; it was intended to regulate the function of lawyers. I will certainly look at the wording again but, as I said in moving the amendment, the Bill lacks a clear statement of its purpose. The Government have said that its purpose is to lift the burdens of regulation. We support that, but our fear is that, without that being clearly stated at the beginning of the Bill, there will be a temptation for Governments faced with a congested parliamentary programme—as all Governments have been, certainly those I have been a member of—to say, “Why can’t we do this by order under the Legislative and Regulatory Reform Act?”. That is what we want to avoid.

I want to come back to this at a later stage, having considered what the noble Lord has said, but my noble friends on the Front Bench and I attach a good deal of importance to what we are trying to achieve here. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Page 1, line 13, leave out from “otherwise,” to end of line 14 and insert “which affects the carrying on of any lawful activity”

The noble Lord said: My Lords, I apologise to the noble Lord, Lord Jenkin, for mispronouncing his name. It was a slip of the tongue.

This is a minor and technical amendment, but one which provides a specific response to points made by noble Lords in Committee. The amendment makes explicit that which is implicit in the present draft of the Bill; namely, that the ability to remove sanctions for doing or not doing something in the course of an activity does not permit the removal of sanctions from activities such as drug-dealing, people-trafficking or other unlawful activities.

This is an important and essential safeguard against any inappropriate use of the order-making power and should ensure that any change to sanctions for unlawful activity must be delivered by primary legislation, subject to detailed parliamentary debate.

It is possible, by order, to repeal offences, or reduce or remove sanctions for offences which relate to the carrying-on of any lawful activity. This is not new and was possible under the Regulatory Reform Act 2001. It has been shown to be a necessary power to deliver better regulation so that offences can be repealed and sanctions reduced or removed where they are no longer considered to be targeted or appropriate.

The Bill also carries over the ability under the present legislation by order to replace sanctions with new sanctions, or to create a new offence that is punishable on indictment up to a limit of two years’ imprisonment. I beg to move.

On Question, amendment agreed to.

[Amendment No. 4 not moved.]

Page 2, line 2, leave out from “department” to end of line 3.

The noble Lord said: My Lords, my amendment to Clause 1(4) would remove the words,

“unless it affects the Minister or department in the exercise of a regulatory function”.

The 2001 Act specifically excluded any burden that affects only a Minister of the Crown or government department. The Explanatory Notes to that Act explained that it allowed for the relieving of burdens from anyone, including Ministers and government departments,

“but not where only they would benefit”.

Those are the crucial words. That provision is not repeated in the Bill that is before us. It is not right that Ministers or central government departments should be, as it were, self-lawmaking in the exercise of their own regulatory functions in removing burdens from themselves. That is not what the measure is supposed to be about; it is about removing burdens from the economy, business and those who are affected by regulation. When the Hampton committee reviewed this matter, it indicated that in practice it may be possible in most cases to find a third party who was affected, so that the reforms were not for the sole benefit of the Minister or department. I understand that there have been some examples of that under the provisions of the 2001 Act. However, it may not always be the case.

I should have thought that in these circumstances we ought to repeat the restriction on the order-making power—that this power should not be used simply to allow Ministers to remove burdens from themselves. If Parliament has by legislation imposed a duty on a government department or Minister, no doubt for very good reason, it is not right that a Minister should come along later with an order and say, “We do not want it to apply to us”, which is the effect of the measure. That is not right. We should retain the distinction that was made in the 2001 Act that the power cannot be used where only Ministers and their departments would benefit. I hope that on reflection the Minister will accept that. I beg to move.

My Lords, I am grateful to the noble Lord, Lord Jenkin, for moving the amendment. I am slightly intrigued, as I thought that the noble Lord, Lord Kingsland—who is not present at the moment—was rather keen on this provision, but I let that rest.

The amendment would rule out altogether orders being able to remove or reduce burdens that affect only a Minister or government department. Clause 1(4) makes it clear that burdens that fall only on a Minister or government department may be removed only in the narrow situation where the burden affects the Minister or department in the exercise of one of its regulatory functions. The provision is therefore a safeguard that ensures that, for instance, it will not be possible to make an order that reforms the provision of public services such as healthcare or education because it is considered a financial cost and therefore a burden on the Government. It is right that orders should not be able to make such reform of the provision of public services. However, I cannot see that it is sensible to prevent orders from making sensible reforms in relation to those regulatory functions that government departments exercise.

As the noble Lord, Lord Jenkin, knows, departments carry out a number of regulatory functions, such as the company law regulatory functions within DTI, or the regulatory functions exercised by the Pesticides Safety Directorate as part of Defra. It is the Government’s view that their regulatory functions should be conducted in as cost-effective and efficient way as regulatory functions exercised by other independent regulators are.

The Government believe that orders should be able to remove or reduce burdens from departments where they are carrying out regulatory functions, in the same way as orders can for other regulators. So, for instance, it should be possible for orders to make changes that reduce the cost or administrative inconvenience for a department exercising its regulatory functions. Where there is a need to make regulatory functions more efficient or to reduce administrative burden and costs for them arising from legislation, it should be possible to do that by order. Whether or not the particular regulatory function is part of a department should be irrelevant. For example, it should be possible to remove an obstacle to the efficiency of Companies House by order, just as it would be possible in relation to the efficiency of the Environment Agency.

In summary, making an arbitrary distinction between regulatory functions exercised by government departments, where the Government are the regulators, and those exercised by independent regulators, as the noble Lord, Lord Jenkin, proposes, cannot logically be right. For those reasons, I suggest that the noble Lord might consider withdrawing his amendment.

My Lords, I have listened carefully to what the Minister has said. I would have thought that in all the examples that he gave there would clearly be burdens on other people and, therefore, there could be no difficulty with making orders under the Bill to reduce those burdens. I am concerned about cases where Parliament has imposed a clear burden on a government department for a particular purpose, but where the Government are now trying to relieve themselves of that obligation. However, I will consider what the noble Lord has said. Perhaps I may need to come back to this at a later stage but, in the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 6 not moved.]

Page 2, line 15, at end insert “and does not include any legislation (whether or not in force) which was passed at least one year before the day on which the order is made”

The noble Lord said: My Lords, the amendment seeks to bring back a provision from the 2001 Act—that an order cannot be made too soon after the Act or regulation has been passed. The argument is that time should be given to see whether the order is effective or burdensome. The 2001 Act stated that an order could not be made for two years and I can understand that that may well have been considered too restrictive. Therefore, in the amendment I suggest that a period of one year would be sufficient.

It takes time after Parliament has passed a Bill, created an Act and approved regulations to assess what the effects actually are. Is the order over-burdensome, in which case it should be amended, or does it achieve its purpose without imposing unreasonable or disproportionate burdens? My amendment would give the Government an opportunity to take stock for a short time. It seems absurd to be able to pass a regulation and then, within a few weeks or months, say, “Oh well, we got it all wrong and we now want to make an order to amend it or remove it”. That would not smack of good government and a year seems to be a reasonable period to allow the Act or order to have an effect. If it then appears to impose an unreasonable or disproportionate burden, as set out in the Bill, an order can be brought forward. I beg to move.

My Lords, I shall deal with both amendments in the group together. The noble Lord has described them well. They would move the order-making power in Part 1 of the Bill back in the direction of the 2001 Act by providing for a similar provision to the two-year rule. While the 2001 Act has enabled some 30 worthwhile reforms, it has proved ineffective for a number of reasons. This is why we are discussing this new Bill, which moves away from the prescriptive nature of the 2001 Act, and it is why the Government cannot support this amendment. We want to avoid imposing unnecessary and arbitrary restrictions on the order-making process, which is what the amendment would do.

One example of the negative effect of the two-year rule in the 2001 Act was in relation to the Regulatory Reform (Gaming Machines) Order 2003. This order was originally expected to save that industry £9.5 million annually. Unfortunately, part of the proposals had to be dropped because it was prevented by the two-year rule, as the relevant provisions had been amended by a prize uprating order, which is occasionally necessary to increase the maximum amount that certain gaming machines can pay out. Dropping this part of the proposals reduced the estimated savings to the gaming machines industry by £1.85 million annually.

I recognise that the amendment would be less restrictive than the two-year rule in the 2001 Act, but we do not wish the Bill to prevent businesses, the public and voluntary sectors from benefiting fully from the Government’s regulatory reform proposals. As I am sure the noble Lord is aware, every order under Part 1 is subject to statutory consultation, and the results of that consultation will influence both the Minister and Parliament in coming to a decision on the content of the draft order that is laid and on the appropriate level of parliamentary scrutiny for that order. The results will also influence whether Parliament wishes to approve the order or whether it exercises its right to veto it. Surely that is a satisfactory degree of scrutiny for any potential proposal that might seek substantively to amend legislation that is less than a year old.

I recognise that the noble Lord is seeking to ensure that the amendments encourage the Government to produce well thought-out legislation that should not need to be amended within a year of it being enacted. However, although he is as eager as we are to improve the way that we make policy, I do not believe that this amendment is the appropriate mechanism for doing so. I remind the House that the Government continue to review the way that policy is made and that the Better Regulation Executive is currently developing proposals to improve the effectiveness of the regulatory impact assessment process. We continue to review legislation, and we have given an undertaking to review this Bill no more than five years after it is enacted.

I am sympathetic to the noble Lord and understand that he does not wish to encourage sloppiness in the drafting of measures or in the way in which they are brought forward or introduced. However, we all have to accept that from time to time a law of unintended consequences is at work in legislation. Although the noble Lord does not seek to impose as rigorous an approach as was contained within the 2001 Act, nevertheless, I continue to hold that the amendment would be an unnecessary restraint on improving the process and ensuring that we have a genuinely deregulatory approach. For those reasons, I hope that the noble Lord will withdraw his amendment.

My Lords, no opposition Back-Bencher can hope to dredge up examples of the detailed effect of the earlier legislation in the way that the collective memory of a government department can. I heard what the noble Lord said. We will obviously need to think about this but, in the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 8 not moved.]

Page 2, line 21, leave out paragraph (c).

The noble Lord said: My Lords, I shall speak also to the other amendments in this group. Amendment No. 9 is a minor and technical drafting amendment, which merely deletes an unnecessary paragraph in Clause 1(7). Noble Lords will see that paragraph (c) repeats a provision already made by paragraph (b).

Amendment No. 35 is also a minor and technical drafting amendment. It would align the definition of “EEA agreement” to be inserted into the Scotland Act 1998 (Transitory and Transitional Provisions) (Publication and Interpretation etc. of Acts of the Scottish Parliament) Order 1999—the Scotland Act order—by Clause 26(3) of the Bill with the definition of “EEA agreement” to be inserted into the Interpretation Act 1978 by Clause 26(1) of the Bill. That would simplify the definition to be inserted into the Scotland Act order and make it less cumbersome to use in practice. The amendment has of course been agreed with the Scottish Executive.

The purpose of subsections (1) and (3) of Clause 26 is, among other things, to amend the Interpretation Act and the Scotland Act order respectively by inserting a new standard definition of “EEA agreement”, which means that references in domestic legislation to the EEA agreement will automatically be to the most up-to-date version of that agreement. The definition of “EEA agreement” to be inserted into subsection (1)(a) will allow Acts of Parliament, and subordinate legislation made under them, to refer automatically to the most up-to-date version of the EEA agreement. The definition of “EEA agreement” to be inserted into the Scotland Act order will allow Acts of the Scottish Parliament and Scottish subordinate legislation to refer automatically to the most up-to-date version of the EEA agreement.

As currently drafted, the definition of “EEA agreement” to be inserted into the Interpretation Act by Clause 26(1) refers to that agreement as,

“modified or supplemented from time to time”.

However, the definition of “EEA agreement” to be inserted into the Scotland Act order by Clause 26(3) refers to the EEA agreement as,

“from time to time modified or supplemented by or under the Community Treaties”.

Amending the definition of “EEA agreement” to be inserted into the Scotland Act so that it also refers to that agreement as,

“modified or supplemented from time to time”,

will prevent any confusion that may have resulted from the existence in domestic legislation of two differently worded definitions of “EEA agreement”. The amendment would remove the phrase,

“from time to time modified or supplemented by or under the Community Treaties”,

from the definition to be inserted into the Scotland Act order and would replace it with,

“modified or supplemented from time to time”.

That would simplify the definition of “EEA agreement” to be inserted into the Scotland Act order and align it with the definition to be inserted into the Interpretation Act 1978.

The current definition to be inserted into the Scotland Act order refers to the agreement on the EEA signed at Oporto, together with the protocol signed at Brussels, as from time to time modified or supplemented by or under the Community treaties. That definition works because any modification of the agreement that is not a Community treaty can be designated as one under Section 1(3) of the European Communities Act 1972. However, this is cumbersome, as it requires the making of an Order in Council. The amendment would make the definition simpler and would remove the need for an Order in Council by removing the reference to “Community Treaties” and allowing the definition of “EEA agreement” to capture all amendments and modifications to the agreement without the need for an Order in Council.

I now turn to two final minor and technical amendments—Amendments Nos. 38 and 41—which have been agreed with the Department for Social Development in Northern Ireland. They are intended simply to update a reference in the Deregulation and Contracting Out (Northern Ireland) Order 1996 so that it refers to Sections 1 or 2 of the Legislative and Regulatory Reform Act 2006, rather than Section 1 of the Regulatory Reform Act 2001. Article 17(1) of the order refers to Section 1 of the Regulatory Reform Act 2001. As the LRRB is repealing and replacing that Act, the reference in Article 17 will need to be updated to refer to Sections 1 or 2 of the 2006 Act.

Article 17 enables the Department for Social Development in Northern Ireland to maintain parity with the DWP in the field of child support, social security and pensions. These amendments would simply enable that to continue to be the case. The principle of parity in the field of social security, child support and pensions is enshrined in Section 87 of the Northern Ireland Act 1998. In effect, that means that benefits should be available throughout the UK at the same rate and be subject to the same conditions of entitlement. An example of where the power in Article 17 was used to maintain parity in this way was the Deregulation (Carer’s Allowance) Order (Northern Ireland) 2002. This order renamed the invalid care allowance and made a number of other changes to the renamed carer’s allowance in line with the changes made by the Secretary of State for Work and Pensions in the Regulatory Reform (Carer’s Allowance) Order 2002. I ask noble Lords to accept these technical amendments. I beg to move.

My Lords, I am in a quandary in relation to Amendment No. 9. I apologise for my late involvement in the Bill, which was caused by ill health. Generally, I applaud the intention of the Bill, but it is poorly served by the sweeping nature of some of its contents. I declare an interest as chief executive of a regulatory body—the Environment Agency—although the Bill goes much wider than simply environmental legislation and regulation.

I had hoped that when the Minister rose to explain the dropping of subsection (7)(c) he would say that it indicated the Government’s commitment to not using this legislation to substantially alter the powers of statutory regulators—or, indeed, to abolish statutory regulators—through secondary legislation when they had been set up by primary legislation, often after considerable debate. I know that the Government have given assurances both in another place and in this House at earlier stages of the Bill about not using this legislation to abolish regulatory organisations set up by statute. I was pleased to see a letter from the Parliamentary Secretary at the Cabinet Office to the chairman of the Food Standards Agency, which states:

“You will be aware that the Government has stated during the passage of the Bill that it is not our intention to erode the independence from Government of those regulators set up by statute”.

I know that the Government have also given assurances about full consultation if proposals significantly alter—

My Lords, I wish the Minister will give me some indulgence, as I have not had the opportunity to speak before.

My Lords, I apologise for intervening, but I wonder whether the noble Baroness is speaking to the amendment that I moved. There is a later amendment, which I think covers the issue that she seeks to address.

My Lords, the point that I want to make is that, in spite of assurances about full consultation, the Government have not been willing to specify that secondary legislation that would significantly alter the powers of the statutory regulator would be subject to the super-affirmative procedure. This is the only opportunity on Report to ask the Minister to humour me and to give further assurances that the legislation is not intended to be a means by which a regulatory body set up by primary legislation can be significantly altered in its role and powers, or indeed be swept away by secondary legislation.

My Lords, we shall come to that issue, which I imagine will be debated extensively after the break. I hope to deal fully with the issues raised by the noble Baroness. I note, in particular, that she raised the issue of the super-affirmative procedure, which we shall return to shortly.

Amendment agreed to.

[Amendment No. 10 not moved.]

Clause 2 [Power to promote regulatory principles]:

[Amendments Nos. 11 and 12 not moved.]

Clause 3 [Preconditions]:

[Amendment No. 13 not moved.]

Page 3, line 33, at end insert-

(f) the provision is not of constitutional significance.”

The noble Lord said: My Lords, I shall also address Amendments Nos. 15, 16, 25, 26 and 27 in this group.

Amendment No. 14 creates a new precondition, which prevents a Minister from making provision in an order which he considers constitutionally significant. The only exception to this is that orders may restate constitutionally significant provisions, but only where this would make the law more accessible or easily understood. I am sure that noble Lords would agree that that is a highly desirable objective.

The order-making powers in Part 1 are clearly focused on delivering better regulation, as we have explained to the House many times before. There are already important safeguards in the Bill, as we have made clear, such as the existing preconditions and restrictions in Clauses 3 to 11, the public consultation required by Clause 13, and the parliamentary procedures provided for in Clauses 12 and 14 to 18, including Parliament’s statutory veto. The Government have also undertaken not to use the order-making powers to make highly controversial changes.

Given all these protections, can the order-making powers in Clauses 1 and 2 be used to deliver significant constitutional change? The Government’s view is that they cannot. We are supported in our view by the reports of the Select Committee on Delegated Powers and Regulatory Reform and the Constitution Committee of your Lordships’ House. The committees said that the powers in Clauses 1 and 2 were not inappropriate.

However, after our debates in Committee it was apparent that concerns remained that the order-making powers could be used to bring about fundamental constitutional change. The Government are clear that those concerns are misplaced and that the Bill could not be used to make such constitutional changes. We have, however, listened to those concerns and tabled this amendment to put the issue beyond any possible or reasonable doubt.

If this amendment is agreed to, it will be added to the other preconditions which the Minister must consider to be satisfied for an order to be intra vires. We consider that a precondition is the most effective mechanism to meet noble Lords’ concerns. It avoids the problems associated with the approach taken by the noble Lords, Lord Goodhart, Lord Norton and Lord Jenkin, in Amendments Nos. 15, 16, 25, 26 and 27. It will also work well in practice.

There is widespread agreement on the benefits that cutting red tape can bring to the public, private and third sectors. This Bill aims to improve the process for delivering better regulation by removing the arbitrary technical restrictions which prevented the earlier Act from being an effective tool for delivering better regulation. It is important that we should not create new arbitrary restrictions. Amendment No. 14 is targeted on making clear that the Bill cannot be used for the delivery of significant constitutional reform by order, but will not prevent the use of orders to deliver better regulation.

For instance, the precondition in Amendment No. 14 permits the amendment of statutes that might be thought of as “constitutional” merely to reform, say, requirements to serve a notice which were administratively inconvenient, where that minor but worthwhile reform was not constitutionally significant and met the other preconditions, including those protecting necessary protections, rights and freedoms.

Similarly, the new precondition in Amendment No. 14 will permit trivial or consequential amendments to be made to statutes that are constitutional in nature, for example by allowing the correction of cross references to other Acts or names which have been changed. A further benefit of the precondition is that, as with the other preconditions in Clause 3, it is right for the Minister to have to make this judgment—although the judgment is also rightly subject to various safeguards and checks. It is the Minister who promotes the order, and therefore he who must be satisfied before he does so that what he is proposing is within his powers. But, to comply with the public law duties placed on him, the Minister’s opinion must be reasonable and this may be challenged through the courts.

Once the Minister has taken a view on the proposals, they will then go out for statutory public consultation, as required by Clause 13. Consultees will have an opportunity to comment on all aspects of the proposals, which could include whether they believe the proposal is constitutionally significant. The Government have made a commitment not to deliver highly controversial proposals by order, and consultees’ views will form part of the Minister’s assessment on matters of controversy. If, after the consultation, the Minster decides to proceed with the making of the order, he will lay a draft order before Parliament. The Minister must explain why he considers that the constitutional precondition and the other preconditions are satisfied in the explanatory document that must also be laid before Parliament, under Clause 14(2). Parliament will then consider the appropriateness of the order, taking into account whether the preconditions are met and whatever other factors it considers relevant. Parliament has the veto over orders, so ultimately it can reject proposals that it finds inappropriate for delivery by order.

I want to go over the amendments in this group that we cannot support. In Committee, noble Lords acknowledged the difficulties with a list of excluded enactments or subject areas. We rejected this approach, which is set out in the various amendments. At Second Reading, the noble Lord, Lord Goodhart, acknowledged that it would be nigh impossible to define a set of constitutional enactments—if such a class of legislation could be said to exist—or constitutional areas. Defining such a list is difficult. One must judge where it might begin and end. Amendments Nos. 25 and 26, which are consequential on Amendment No. 27, show the difficulties of this approach.

The list of excluded Acts in Amendment No. 27 is much shorter than those we considered in Committee and differs from the list of statutes and areas in Amendment No. 25. The difference between the lists shows the lack of consensus on the issue. Amendment No. 27 creates a list of excluded Acts regarding devolution. The Government are content that the new precondition would prevent any constitutionally significant amendments to the Scotland Act and the Government of Wales Acts, just as it would prevent constitutionally significant amendments to any other enactment.

We are therefore content that orders could not be used to effect significant constitutional changes to the UK’s devolution settlements and that Amendment No. 14 puts that beyond doubt. However, as I mentioned, the new constitutional precondition would allow minor amendments which are not of constitutional significance. The Government believe that we should not prevent orders from delivering useful better regulatory reforms which are not constitutionally significant to statutes, which could include the Scotland Act and Wales Acts. Our Amendment No. 14 is therefore better targeted than Amendments Nos. 25 and 27.

I do not understand why the noble Lords, Lord Goodhart and Lord Maclennan, have singled out the right to trial by jury in Amendment No. 16. Clause 3 already prevents Ministers from making orders containing provisions which they consider would remove necessary protections, or prevent a person from continuing to exercise any right or freedom which they might reasonably expect to retain. Therefore, the Government are already of the opinion that the right to trial by jury is a necessary protection, and a right which someone might reasonably expect to keep. I cannot see how an order could be used to effect such change. I give the assurance that the right to a jury trial is already protected in that sense.

As I have said before, defining the parameters of an appropriate list of statutes or areas would be cumbersome. It would amount to trying to write or codify the constitution, which is what Amendment No. 15 of the noble, Lord Norton, and Amendment No. 25 of the noble Lord, Lord Jenkin, attempt to do. This is a significant project, as I am sure noble Lords would agree. If we are to debate the parameters of the constitution, this Bill is not the context in which we should do so.

The House of Lords Constitution Committee recognised the difficulties with devising a schedule of exempted areas, and states that a schedule would be something of a blunderbuss approach. It notes that not all provisions in Acts with constitutional implications affect our constitutional arrangements, and concludes that,

“it might be thought wrong to exclude such provisions from the general operation of the bill”.

This is precisely the problem with Amendments Nos. 15, 25 and 27.

The amendment tabled by the noble Lord, Lord Norton of Louth, sets out areas which he thinks should fall within the scope of the “constitutional significance” amendment. Not every proposal for change in these areas will necessarily be of constitutional significance; they might be exceedingly trivial. If they are significant, they will fall within the scope of the precondition without further definition. Unless they deal with issues which fall within the general purposes of the Bill, they will be doubly ultra vires.

The amendment adds nothing to the protection of rights and freedoms in the Bill, which, of course, include the precondition concerning rights and freedoms. It is already unlawful for a Minister to make an order that is incompatible with convention rights under Section 6 of the Human Rights Act. Clause 9 also prevents amendments to the Human Rights Act itself. Adequate safeguards concerning the Human Rights Act already exist, and so the provision is, in this respect, otiose. Furthermore, the Government consider that it would be foolish to put some Acts off limits when it may be necessary to make minor or consequential changes to them for the purposes of better regulation.

I note that the list in Amendment No. 15, tabled by the noble Lord, Lord Norton, would rule out any reform of the Executive, preventing useful better regulation reforms to government departments which act as regulators. Clause 1(4) prevents orders from inappropriately removing burdens which fall only on Ministers or government departments. It provides that burdens falling only on Ministers or departments can only be removed in so far as they are burdens which affect the Minister or department in their exercise of a regulatory function, as we discussed earlier.

Fears were expressed that the Bill would somehow allow departments to cease providing public services. Clause 1(4) ensures that, for instance, it would not be possible to make an order stopping the provision of a public service because it was considered a cost and a burden. As Cabinet Ministers have argued on many previous occasions, any substantial policy change to core public services would be utterly unsuitable for delivery by order. However, some amendments to enactments relating to the Executive could be usefully delivered by order. The Government have a number of regulatory functions such as the company law regulatory functions within the DTI and the pesticides directorate, to which we have referred before. The Government believe that orders should be able to remove or reduce burdens from departments where they are carrying out regulatory functions, in the same way as they can for regulators.

Amendment No. 15 would seem to permit major reforms to the Civil Service or local authorities. Abolition of local authorities would fall foul of my Amendment No. 14, but Amendment No. 15 seems to define constitutional significance in a way which would no longer rule this out. This shows the strength of the government amendment. The new constitutional precondition rules out the elephant of constitutional significance—which we all recognise when it arrives—while avoiding the difficulties of attempting a definition.

Although the Bill could not be used to make significant constitutional change, Amendment No. 14 will put beyond any doubt that the order-making powers could not be used to enact significant constitutional change. It also avoids the difficulties with a list of constitutional enactments or subject areas, which were highlighted by the Constitution Committee.

I have explained why the Government believe that their approach is the most appropriate and wholly adequate without further bolstering. I therefore commend Amendment No. 14 to the House, and suggest that, on reflection, noble Lords do not move Amendments Nos. 15, 16, 25, 26 and 27. I beg to move.

Line 2, at end insert-

“( ) For the purposes of subsection (2)(f), a measure of constitutional significance is one that affects the structures, powers and compositions of organs of the state (the Crown, the executive, Parliament and the judiciary), the relationship of those organs to one another, or the rights and freedoms held by the individual at common law or under the provisions of the Human Rights Act 1998 (c. 42).”

The noble Lord said: My Lords, the government amendment is welcome but runs up against the obvious problem that the Minister has touched upon but not really dealt with: what constitutes a measure of constitutional significance? He says that we will all recognise it when it arrives. I do not think that is the basis for legislating.

We have come up against this problem before, not least when debating the then Political Parties, Elections and Referendums Bill, as the Minister will remember, when there was an attempt to provide for referendums on issues of constitutional significance. The problem was recognised in Committee, prompting the Minister’s amendment. If we are to have the government amendment, however, we need to know precisely what it encompasses.

The Government have a problem defining what their amendment encompasses. When the then Lord Chancellor, the noble and learned Lord, Lord Irvine of Lairg, appeared before the Constitution Committee of your Lordships’ House, he conceded that the Government did not have a definition of a constitution, but also that the one offered by the committee was as good as any. When his successor, the noble and learned Lord, Lord Falconer—Secretary of State for Constitutional Affairs as well as Lord Chancellor—appeared before the committee, he, too, reiterated that the Government did not have a definition of a constitution. Under Amendment No. 14, Ministers are thus precluded from using orders to amend measures of constitutional significance, without any clear definition of what falls within the scope of that term. One cannot rely on each Minister to determine what it means, as the noble Lord, Lord Bassam, seems to imply. Hardly any Minister has any grounding in the subject, and relying on consultations, as the noble Lord suggests, will not advance us any further. What one Minister deems to be of constitutional significance may not be so construed by another.

The purpose of my amendment to Amendment No. 14 is to provide a clear stipulation of what the term “constitutional significance” encompasses. As the Minister noted, I have adopted what I referred to in Committee as “the generic approach”. As I argued then, it is not incompatible with the approach of listing measures to be excluded because they are deemed to be of constitutional importance. However, given the Minister’s amendment, I think the generic approach is the appropriate one.

I concede that what I propose is not a watertight definition, which is the point the Minister developed. It is impossible to generate such a definition, but I think that it is sufficient to demonstrate what should be out of bounds for the order-making powers in the Bill, and that it is necessary in the light of the government amendment. I am not sure that one can have Amendment No. 14 without Amendment No. 15; it is a case of both or neither.

The definition I have employed is not watertight, but it is not too dissimilar to the one that the noble and learned Lord, Lord Irvine of Lairg, said was as good as any he had seen. In Committee, the noble Lord, Lord Bassam, appeared to misunderstand what was embodied in the definition; he then thought it was confined to the relationship of the different organs of the state to one another, which clearly it is not. It is a more encompassing definition.

I hope that, on reflection, the Minister will realise that this amendment is helpful to Ministers. It helps to prevent them straying into territory that they should avoid and thus reduces the chances of a challenge to the decision. The noble Lord may argue—as he did in Committee and has already done today—that Ministers will not stray into that territory. However, the amendment he moved is designed to provide in the Bill that that territory is out of bounds, and my amendment helps to define the territory.

I can see that the Minister has gone a considerable way to meet the concerns expressed in Committee, and I am grateful to him for his letter on the subject. His amendment is a necessary but insufficient condition if provisions of constitutional significance are to be excluded from the order-making powers of the Bill. I beg to move.

My Lords, Amendments Nos. 16 and 27 in this group are tabled in my name and that of my noble friend Lord Maclennan of Rogart. I strongly welcome Amendment No. 14, which provides a useful additional block against abuse of the process provided for by the Bill. However, I do not welcome it quite as strongly as I would have welcomed my Amendment No. 13 being accepted. This is the simplest and best solution to the problem debated in Committee. It is certainly preferable to having a list of constitutional statutes and, probably, to having a list of topics of constitutional importance. In any event, I could not support Amendment No. 26 because a list of constitutional statutes would need constant updating, and many statutes contain provisions that are constitutionally important alongside those that are not.

Amendment No. 15, tabled by the noble Lord, Lord Norton of Louth, is considerably more valuable. I have some difficulties with it and, if it is to go into the Bill, it would need to be looked at more carefully. For example, the statutory powers of the Executive would not be touchable, but some minor steps to extend or, perhaps more importantly in this context, restrict powers would plainly not be of constitutional significance. Indeed, one of the main purposes of the Bill could be said to be to remove unnecessary powers of the Executive. To that extent, the amendment arguably defeats part of the purpose of the Bill. On the other hand, the definition does not include the Scottish Parliament or the Welsh Assembly in the definition of the organs of the state, but any move in Westminster to impose restrictions on the powers of the devolved legislatures would, in the present circumstances, plainly be a matter of constitutional importance.

I tabled Amendment No. 16 to fill a possible gap because I was not entirely satisfied that the rights to a trial by jury were covered by the Bill. However, I heard the Minister say that the Government’s understanding is that the existing conditions in Clause 3 would have that effect and would prevent any step to remove an existing right to trial by jury. I am happy to accept that statement and shall not press this amendment.

Amendment No. 27 adds the devolution statutes relating to Scotland and Wales to a list of statutes in Clause 8 that cannot be altered by order under the Bill. I tabled this amendment to meet the concerns of some Members of the Scottish Parliament. I understand that the Scottish Parliament was assured that changes to the devolution settlement—in particular, any changes to the Scotland Act—would be interpreted as being provisions of constitutional significance. The Minister said that the Bill would permit changes to the Scotland Act that are not of constitutional significance. Having looked at the Scotland Act, I can see that there are some changes that, on the face of it, could be regarded as not being of constitutional significance. But there is concern in Scotland that the Westminster Parliament should not be free to use this special procedure to make any changes to the Scotland Act. The Scotland Act is, in a sense, the possession of the Scottish Parliament in the same way as it is clearly the possession of the United Kingdom Parliament in which we sit. In those circumstances, unless the Minister is prepared to give an assurance that the Scotland Act will be untouchable under the Bill and that any changes to it will be regarded as being of constitutional importance, I would need to take further instructions from my colleagues in the Scottish Parliament to see whether they are satisfied with that position. At present, I am not satisfied with what the Minister has said on that subject.

My Lords, the noble Lord, Lord Goodhart, has made an important point. Amendment No. 25, which was tabled by my noble friend Lord Jenkin, who probably feels he need not speak to it at this point, lists a number of Acts as a means of defining that which is of constitutional importance. That would solve the problem that the Members of the Scots Parliament see. They are thinking rightly when they say that they do not want the Scotland Act fiddled about with by regulatory reform orders at Westminster, although the Scotland Act is, of course, Westminster legislation. It is excellent that the Minister, having argued strongly in Committee against doing anything about the issue, has now moved an amendment to exclude matters of constitutional importance from Part 1. The definition by list, which the Law Society of Scotland suggested previously and is again suggesting, has weaknesses. It is difficult to have an exclusive list. But, at the same time, it solves the problem raised by the noble Lord, Lord Goodhart, so we have a difficulty.

My noble friend Lord Norton made a very powerful argument for clarifying what Amendment No. 14 would do. I too wondered whether legislation passed by the Scots Parliament and the Welsh Assembly would be included in the amendment. Of course there is ancient legislation in Scotland, which may have to be changed, and the question is how to do that when it concerns devolved matters.

The Government should look very carefully at what my noble friend Lord Norton said. His wording may not be absolutely correct, but I suspect that he has thought deeply about this subject, on which he knows a great deal. The Minister should not brush it off lightly but see whether he can return at Third Reading with something similar.

My Lords, we are grateful that the Minister, despite the strong manner in which he expressed himself in Committee, has listened to the arguments put to him and come forward with Amendment No. 14. With my noble friend Lord Norton and the noble Lord, Lord Goodhart, we are grateful also for the further reassurances given by the Minister. I support my noble friend Lord Norton because I think that his approach is a better one. Since the Minister seems prepared to move, perhaps between now and Report—

My Lords, I am grateful for the correction from my noble friend. The Minister could give further thought to the amendment of my noble friend Lord Norton and see whether he could further improve the Government's response.

My Lords, this is a very interesting situation. We all agree that this Bill should not be allowed to alter the constitution, but we really do not know what the constitution is. We can neither find a one-line definition of what we can prevent nor decide whether the admirable effort of the noble Lord, Lord Norton, meets the requirement. This proves that we need a written constitution.

My Lords, I am grateful for those words of support from the Front Benches opposite for the Government’s amendment. The noble Lord, Lord Goodhart, said that he strongly welcomed it, and the noble Lord, Lord Norton, from the Back Benches and the noble Lord, Lord Henley, said that they welcomed it.

We all recognise that the debate has moved on. We listened very carefully to what was said at an earlier stage in the Bill and have come up with this new precondition. I am not attracted to the attempt by the noble Lord, Lord Norton, to link Amendments Nos. 14 and 15. It is a seductive offer, but one I shall have to decline. I cannot agree that the constitutional precondition fails to offer real protection unless the Bill defines constitutional significance. The other preconditions offer real protections—for example, they offer necessary protections without defining what those necessary protections might be. That was the approach adopted in the 2001 Act, and we think that it provides a genuine protection.

The approach of the noble Lord, Lord Norton, would cause some uncertainty to enter into our intentions, because it is unclear to what extent the piece of legislation would have to affect these areas to be prohibited from reform by order. That could lead to the Part 1 power being interpreted rather narrowly, and might limit its usefulness. In the time we have been debating and considering the legislation, I have sensed that that is not what Parliament wants. It is not the best way to proceed if we are to use those powers in terms of creating the right atmosphere for deregulation.

We do not think that it would be appropriate for the Government to try to pre-empt the views of not only Parliament but consultees in suggesting a list of areas—or statutes for that matter—which Ministers, consultees, Parliament and so on would find constitutionally significant. We do not think that that approach recommends itself.

The noble Lord, Lord Goodhart, raised an issue about Scotland, which was echoed by the noble Baroness, Lady Carnegy of Lour. We do not accept that all changes to the Scotland Act would be of constitutional significance. As she said, the Scotland Act is a Westminster Act. We are content that the new precondition would prevent amendments to the Scotland Act and the Government of Wales Act which were constitutionally significant, just as it would prevent amendments which were constitutionally significant to any other enactment. We are content that orders could not be used to effect significant constitutional changes to our devolutionary settlement. Our Amendment No. 14 puts that beyond doubt.

My Lords, I quite see that some changes could be made to the Scotland Act itself which would not be of constitutional significance. Does the noble Lord not accept that the constitutional significance really attaches itself to any change because of the fact that there are two Governments involved in the Scotland Act—the Government of the United Kingdom and the Government of Scotland? That could—I suggest would—make any change a matter of constitutional significance, even if the change looked at on its own is not particularly significant.

My Lords, I understand the argument the noble Lord puts forward but, because of the narrowness of the issues we are considering and the approach we have adopted, I think that he will accept that most of the things we propose to do by order are, of their nature, minor and technical legislation. It does not fundamentally breach the important principle. For that reason, I think we are on safe territory, but I will reflect on the point noble Lords make. Clearly, we do not wish to unsettle in any way the beauty of the constitutional arrangement that currently exists, and I certainly would not want to upset the noble Baroness, Lady Carnegy of Lour, on this because she is very fierce on these subjects. We know that we have to take very carefully into account any issues of constitutional importance which are raised in Scotland.

My Lords, I said that I would give further thought to the point between now and Third Reading. In general, we are satisfied that the value of the precondition and the particular position of the devolution settlement provide sufficient protections, but the noble Lord, Lord Goodhart, has made a very subtle point that I will consider further.

My Lords, as my amendment to the government amendment is before the House, I shall respond briefly to the Minister. I shall also respond to points made by other noble Lords.

By putting a particular provision into the Bill, the Government are putting it into law. We should be extremely wary about allowing a measure to be introduced that has an implicit elephant definition—in other words, we know it when we see it—which is to be determined by consulting people who are approached when order-making powers are being prepared. That is not the way in which to proceed. It causes too many problems. The Minister says that he thinks he is on safe territory. My point is that the territory is not defined. This needs to be pursued. Having said that, I listened with great care to what the noble Lord, Lord Goodhart, and my noble friend Lady Carnegy of Lour said, and I see that certain points in my amendment need to be addressed. Therefore, I shall not pursue it now, but there is a case for returning to it to ensure that what the Government are putting into the Bill, which I welcome, is taken further so we know what it actually means. For the moment, I beg leave to withdraw the amendment.

Amendment No. 15, as an amendment to Amendment No. 14, by leave, withdrawn.

On Question, Amendment No. 14 agreed to.

[Amendment No. 16 not moved.]

Local Government White Paper

My Lords, with the leave of the House, I shall now repeat a Statement made in another place by the Secretary of State for Communities and Local Government on the future of local government. The Statement is as follows:

“Local authorities and the services they provide in partnership with others are hugely important to the health and strength of our communities and country. They help to determine the quality of our everyday lives—the schools our children attend, the cleanliness and safety of our neighbourhoods, the health of families, the ease with which we can travel, and the leisure activities we enjoy. Many of the biggest social advances in recent generations were led by local government and its leaders. They have served their communities well. But, in 1997, this Government inherited public services and institutions that were rundown, demoralised and starved of cash and resources. We responded with significant investment to expand capacity, and by setting a strong direction nationally.

“Combined with the hard work and commitment of local councillors, the local government workforce and other partners, this has led to real improvements in local public service delivery. For the next phase of reform, we need to respond to new challenges. The increasing complexity and diversity of these—from climate change to tackling deep-rooted social exclusion—demand more flexibility at the local level. Expectations of citizens are rising fast. They rightly want more choice over the services they receive, more influence over those who provide them and higher service standards.

“The White Paper that I am publishing today proposes that local authorities and other public service providers have the freedom and powers they need to meet the needs of their communities and to be more clearly accountable for doing so. Communities must also have a bigger say in the issues that matter to them most. We therefore propose a new settlement with local government, communities and citizens. We will give local authorities a stronger role in leading their communities and bringing services together to address local needs and problems. Central government will play their part in guaranteeing minimum standards and setting overall national goals, but we will step back and allow more freedom and flexibility at the local level. In exchange, we expect to see more accountability to local citizens, stronger local leadership, better and more efficient services and a readiness to support tougher intervention when things go wrong.

“The White Paper sets out how we intend to achieve this rebalancing between central government, local government and local people. At present, there are as many as 1,200 national targets and indicators for a local area. In future, we will cut this to 200 indicators, with around 35 targets, plus statutory education and childcare targets. The targets will be tailored to local needs, agreed between government and local partners and set out in the local area agreement. In this way, we will focus on the things that really matter to people everywhere, guaranteeing national minimum standards but encouraging local innovation and local priorities. We will introduce a more proportionate, risk-based inspection regime to cut bureaucracy, and more targeted support or intervention when things go wrong.

“Our best local authority leaders have made a huge difference to the citizens and communities they serve. The White Paper sets out measures to ensure that all communities benefit from strong, accountable and visible leadership. In future, there will be three choices for councils: a directly elected mayor, a directly elected executive of councillors, or a leader elected by their fellow councillors with a clear four-year mandate. All the executive powers of local authorities will be vested in the leader of the council, with a strong role for the council to scrutinise the leader’s actions and approve the budget and major plans.

“The way in which councils choose to govern themselves will be different in different parts of the country. We will make it easier for local authorities to move to a directly elected mayor or executive by resolution of the council, in consultation with local people. Where they want to, they will also be able to introduce whole-council elections and single-member wards, improving accountability to voters.

“We recognise the potential gains that unitary status can offer in terms of accountable, strategic leadership and improved efficiency. There will be a short window of opportunity for councils in ‘shire’ areas to seek unitary status. We expect a small number of proposals to meet the value for money criterion and the other criteria set out in the invitation we have issued today. In remaining two-tier areas, we will work with local authorities to deliver better value for money and greater efficiency.

“Strong leadership works best if balanced by citizens and communities having a bigger say in the quality of the services they receive and the places where they live. To ensure services are more accountable, more responsive and more efficient, local authorities will involve and consult service users more fully and provide better information about standards in their local area. In addition, we will review barriers and incentives to increased community ownership and management of local facilities and other assets. We will increase and strengthen the powers of local people to demand answers and action through a new community call for action.

“Councillors should be champions for their local community, able to speak out on all issues affecting their local area, including planning and licensing. They should be able to sort out issues on the ground or demand a formal response through scrutiny procedures. Effective scrutiny by councillors is an essential part of robust local democracy. We will strengthen it. Communities need strategic leadership to help to bring local partners, the business sector and the voluntary and community sectors together. Issues such as community safety, public health or community cohesion require all local partners to share the same agenda. Our best local authorities already recognise this, and their citizens and communities benefit as a result. Our proposals will ensure that this happens across the country.

“Sir Michael Lyons described the ‘place-shaping’ role of local authorities in his report this May. I pay tribute to his work so far. The proposals before the House today provide a clear basis for Sir Michael’s future conclusions on local government funding. Cities play an increasingly important role as engines of economic growth. In recent years, there has been a renaissance in our towns and cities, thanks to the vision and leadership of local authorities and their partners. But we need to go further. We must look beyond city and town boundaries to consider the success and prosperity of the surrounding area. In recent months, we have consulted our towns and cities on the tools and powers they need for economic development. There is no ‘one size fits all’.

“The White Paper provides a response to issues raised by towns and cities on transport, skills, economic development and co-operation between neighbouring local authorities. We will continue to work with them over the coming months. Our clear, overriding principle is that the greater the powers devolved, the greater the premium on clear, visible leadership. None of our reforms can be carried out without a strong and committed workforce. Local government contains many high-quality councillors and public servants. It has transformed our towns and cities, and in many areas it is leading public services in partnership working, innovation and efficiency. Our reforms will give citizens and communities a clearer voice, create stronger and more visible leadership, and establish a new settlement with local government and its partners, communities and citizens.

“The White Paper is about creating better services and better places. It sets out the tools that will help all local areas to tackle the challenges of the 21st century, to capture the strength and talents of their citizens and communities and to achieve their full potential. I commend this White Paper to the House”.

My Lords, that concludes the Statement.

My Lords, I thank the Minister for repeating the Statement made by the Secretary of State in the other place a short time ago. I declare that I am an elected member of a local council. In doing that, I join the Minister in acknowledging the enormous amount of work—I probably take myself out of this comment—that local councillors do and their commitment to their communities. As with all Statements, there is only a limited amount that one can say in response, partly because the White Paper on which it is based is not released until after the Statement has been made. We are left with just the précis in the Statement, which arrived rather late on our desks, of what is involved.

The first aspect that I would like to test with the Minister is the relationship that the White Paper will have with legislation in the next Session. Will that be with or without the influence of the Lyons report? That is where the meat of change will lie. Fiddling around with the organisation of a local government’s internal arrangements is a minor part of the changes that the Government will presumably have to make. Is it intended that any legislation emanating from this White Paper will encompass the Lyons recommendations? How can anything relevant to local government be decided in the absence of consideration of its financing? Has Lyons effectively been kicked into touch at this time? As we have always expected, the solutions to the questions raised are likely to be far more radical than perhaps the Government wish to contemplate. Will the legislation include any provisions that are required to implement the changes to the Mayor for London’s powers?

It is hard to give a very warm welcome to what has come forward today. All parties subscribe to the theory of localism, but each seems to have a slightly different view of what that means. There may be aspects in this White Paper—when I have a chance to read it—on which we will agree with the Government and which we think are worth having. But devolving powers to the lowest level of democratic government from central government and returning the powers that have been given to the undemocratic regions does not seem to be part of what is on offer here. What devolvement of powers does the Minister believe will come from these proposals, particularly in relation to transport, planning and economic development? At the moment, it seems—this is very cursory—as if devolvement is restricted to enabling a few parish councils to make a few more by-laws.

What has happened to the good intentions from the statements made in the past by the Prime Minister, by the Chancellor, Gordon Brown, and by the Secretary of State, Ruth Kelly, on devolution? Have they got lost in and during the interregnum of the transfer of power at the highest levels in government? What is happening with the Barker report? Will any of her recommendations that need to come forward in legislation be included in the next Session?

As I have said, I have not seen the full proposals so it is hard to know quite what the fine words mean or what relevance they have to the electorate in general. The main thrust seems to be that the Government are trying to devise a new settlement with local government, communities and citizens, which is how it is put. The only welcome proposals to aid that are a promise by the Government to reduce 1,200 targets down to 200 indicators and 35 targets. What of scrutiny by external inspectors? Where will they play a role in this, or are they to be abolished? What penalties will there be for not achieving these targets? Perhaps the Minister will be able to give us information on that.

We would all welcome more support for the democratic leadership of councils. But does the White Paper give any more detail on what would be involved in, for example, a directly elected executive of councillors? Would a leader have to be previously selected or elected by colleagues and then go to the electorate with a full slate of executive members? How would they be selected? How would they be put forward for election? Would they have to be elected as councillors first? If not, how would they be chosen? I hope that there is more clarity than is currently available.

Can the Minister give us some idea of how it is envisaged that the role of back-bench councillors—those who actually represent their communities—will be strengthened? How will they be engaged in the business of the council, or will they remain as they are—largely outside the administration of and decision-making on policy and practice? I am delighted to know that the White Paper gives councillors their voice back on planning and licensing issues. That disgraceful lapse was brought about by this Government. We had long arguments during the debates on the Licensing Bill when we put forward the view that the councillors’ democratic voice would be taken out, but we were completely pooh-poohed. The same thing has happened with planning. I am delighted that at last the Government have realised that this is a role for councillors. It is a disgrace that councillors have not been allowed to speak and that, when they have spoken, they have been threatened with the Standards Board. I very much hope that the White Paper makes it clear that their role is at the centre of these issues and that they are not to be precluded from them. Also, how will the proposals for the community call for action work?

The White Paper looks as if it might be a missed opportunity to truly strengthen local government—that will become more apparent as time goes on—to devolve power properly to the local level and to rid us of the regional level, which was dreamt up by the Deputy Prime Minister and resoundingly defeated by the electorate. It is good that councillors should be able to decide when their elections should be and whether they should be annual or by thirds. It is time for that to be amended and I suspect that many councillors will want to go for the full four-year term.

What are the electorate to make of all this? They are reeling from extraordinary hikes in council tax, which, in the past five or six years, has risen astronomically—all under this Government. The electorate are scared stiff of the revaluation of their properties for local tax purposes. They are now threatened with the Northern Ireland regime, which I hope will not come here, and the arrival of council tax inspectors marching all over their houses to check the amount of double glazing and the views from the windows. They are unable to find their way through the unfathomable processes that will keep elderly people in care without bankrupting them. It does not look as though this White Paper will help with that at all.

I hope that the process that will follow this Statement—that of legislation—will enable us to delve into some of these matters and to end up with proposals and powers that are really relevant to local communities and on which we can ultimately agree. That is what local government is about; it is about representation of its people. The more agreement that we can come to politically, the better that role can be fulfilled. I do not promise that it will be like that. I expect that there is more than meets the eye in this legislation. But, in the mean time, the curate’s egg is well and truly laid.

My Lords, we live in one of the most centralised states in western Europe and, after the effects of this White Paper have been felt, that will remain the case. This is a wasted opportunity. The White Paper has not been worth the wait of the many months that it has taken to get this far. It does nothing to address the increasingly unsustainable burden of council tax or to deal with the dominance of central government funding for local government services. That lack of local financial flexibility is at the core of the weakness of modern local government. The White Paper does nothing to return the powers of central government or quangos back to town halls.

The document is full of motherhood and apple pie, or as I have been taught to say in this new era of equalities, “non gender-specific parenthood”. The Government now claim that they have discovered localism and decentralisation. Of course we welcome their conversion to the idea, but we remain deeply sceptical about whether they have any real understanding of it. The implementation is via a zoo of acronyms and action plans, all of which have the capacity to blur genuine accountability.

The Government remain besotted with the notion of mayors. So far there have been 34 local referendums resulting in 22 rejections and 12 wins. That has been the choice of local communities. But Mr Blair wants mayors and so Mr Blair shall get mayors. We are going to get them through consultation now, not through referendums. If you do not want a mayor, you can have an enhanced leader. This is the imposition of the mayoral system by the back door, and I ask the noble Baroness why the Government are so determined to emasculate back-bench councillors in the same way as they have emasculated Back-Bench MPs. Vesting all executive power in an authority in one person is a highly dangerous move and should be resisted at all costs.

There is a proposal to allow some areas that have already expressed an interest to become unitary councils if they choose to do so, and we believe that this is a sensible way forward. But we would like to know what the triggers are for this and how consent will be determined. Who will have a vote in such a proposal and who will make the final decision?

The exact proposals for parishes are unclear, but giving very local communities more say in service delivery and local well-being is of course to be welcomed, provided that democratic accountability is not lost. A right to initiate a call to action must not turn into mob rule, and principal councils must retain the capacity to take strategic decisions and deliver big services for the benefit of the whole community. If it is left to the weight of numbers, the fix-the-pothole lobby will always be larger than the special-educational-needs lobby, but that does not make it right.

In passing, I should like to comment on the flow chart on page 37, which describes what will happen in a call to action. It has come straight from the Janet and John book of local government. For anyone who has spent time in local government, it is risible.

City regions are a case of the dog that has not barked in the night. We heard a lot about the idea in the Miliband era, but sadly it now seems to be rather silent. Several metropolitan areas are now ready for co-operative working, which they see as a way of unlocking devolved powers from Whitehall. So the crucial issues are the governance proposals that will be linked to the scheme: are they to have mayors; are councils to merge; and are we to have federated structures? More important, what powers would be on offer to those who choose to go down this route? If the scheme is linked to travel-to-work areas, existing council boundaries will be crossed and therefore local consent mechanisms are very important. Strengthening passenger transport authorities is to be welcomed in principle.

Members on these Benches regret that this White Paper has been published ahead of the Lyons review so that the issues of powers, finance and structures will not be considered together despite the fact that they are inextricably linked. We believe that the failure to link these important issues will probably ensure that, even by its own meagre objectives, this White Paper is doomed to fail.

My Lords, I am grateful for the welcome given to the White Paper. I have sympathy with the pressures on Opposition Front Bench spokesmen who have to respond to a very detailed White Paper at short notice. I fully intend to make myself and officials widely available over the coming days and months so that we can sit down and discuss the detail as fully as possible because there is a great deal to consider and on which to take collective advice from the wisdom available around this Chamber. I am particularly pleased to see the noble Lord, Lord Bruce-Lockhart, in his place because I would like to say how much we have appreciated working with the Local Government Association. In response to the cynical voices on the Opposition Benches, I should point out that we have received a great deal of support from the LGA for what we have brought forward because it is very much in tune with what the association has been telling us would be right and proper for local authorities. The noble Lord, Lord Bruce-Lockhart, himself said this morning that these are significant changes.

In the time I have available, I shall address the major issues. There is no way that we would agree that this is a missed opportunity. This is a consensual paper and I look forward very much to it growing more consensual over the coming months as we bring forward legislation because nothing is more important than that we work together in local government to make the best possible offer to citizens. The White Paper has preceded the Lyons report because we were right to say that deliberation on form and function comes first. In his interim report, Sir Michael Lyons influenced our thinking in the emphasis he placed on the shaping of powers and what that would involve, as well as on new ways of working. In turn, we will read and consider extremely carefully what he brings forward. He now has a full explanation of what we think local government can and should do in the future. This is a seamless process. When the local government Bill is brought forward it will give consideration to the things which need legislation as set out in the White Paper, and I will share those with the House as soon as possible. Obviously we have to give a lot of consideration to what Sir Michael Lyons says and therefore the form of the Bill is not yet resolved on issues of that sort. But in no way has it been kicked into touch; far from it. With regard to the impact that this Bill may have on a GLA Bill and the powers of the Mayor of London, there will be no impact.

The noble Baroness asked a number of questions about the sequence in which these things will be dealt with. I have spoken about Lyons, but Barker is of course another example. We will listen hard to what Kate Barker has to say about the ways in which we can improve the planning system, building on what we have done already and addressing the culture of change in planning so as to bring land allocation, land use, housing, employment and productivity closer together—closer to the ground—and make it more effective.

On the devolutionary powers in the Bill, when noble Lords read the White Paper they will see the scope of the devolution. Let me take, for example, the way the powers of the Secretary of State have been reduced. The Secretary of State will no longer be able to determine whether parishes are created; that will go to the district councils. Equally, government will no longer account for whole elections; that will now rest with a resolution of the council. The Secretary of State will not have any power to confirm by-laws. Devolution goes along with the emphasis we give in the first chapter of the White Paper to the voice of the local community and how to amplify it. We emphasise putting best value on the ability of the council to inform, involve and consult so that local people can test councils against best value and ensure that they have achieved it—as indeed many councils do to the best of their ability.

I turn to city powers. This is a work in progress and I hope noble Lords will agree that it is a sensible approach when we are talking about something as radical as looking at ways of giving more powers to cities to enable them to become more efficient—powers which they have told us they want in the enormous consultations we have held not only with cities but with towns around the country as well. Over the next few months we will be looking at the joint review of economic development when considering how to develop city plans. The Department for Transport, for example, is looking to devolve more transport powers, and we will come forward with more worked-out plans when we have had an opportunity to consider the Leach review, the Barker review and the Treasury report on sub-regional economies.

On the performance regime, I am glad that the noble Baroness opposite recognises what a radical step it is to strip out the 1,200 targets and reduce them to 200. They were set alongside the agreement on national outcomes, which will itself determine what all local authorities will work towards: the very top, high-level national priorities which will be determined in the 2007 Comprehensive Spending Review. These are to be 200 indicators which will be agreed between local authorities and central government. But more important again, 35 local targets—different ones for each local region to address particular problems such as economic development or the delivery of public health systems—will be set to reflect local needs. That in turn will be reflected in the local area agreement—the delivery plan—which, for the first time, will be on a statutory footing. This will be underpinned by duties which will attach to the local strategic partnership, with partners not only in local authorities but in the whole range of public services. There is a list of those named partners. There will be more power to front-line councils, which is extremely important.

As to the processes for the direct election of leaders—one of the three options—I should say to the noble Baroness that we are not going to impose mayors. This is not mayors by the back door but an open and very transparent process which will depend a great deal on what the local authority itself wants to do. As to the powers of local councils, the review will look not only at the local call for action but also at training and a stronger role for them. I am glad that there is a welcome for the reformed code of conduct. I shall explain in writing how the community call for action will work. I disagree with the noble Baroness—I think it is a very clear diagram. Would that all my papers had such clear diagrams.

Let me address the issue of unitary status and how it will be managed. We have made it clear that this is an invitation to shire counties which they can trigger and determine themselves. The criteria are set out. We have said quite clearly that we will look at the broad consensus—at what determines it and who supports it. No district council or even groups of councils will have a veto on it. I am very glad that the noble Baroness welcomes the additional powers for parishes and the right that districts will have to create parishes.

I am grateful for the welcome. I look forward to working with the Opposition when we introduce the Bill to make it a good Bill and a good settlement for local government.

My Lords, local government is about the community of place; therefore local government is about local difference and diversity. If it is not, it is not local; and if it is not about local decision making, it is not local government. Otherwise it becomes a post box for central government decisions.

As previous speakers have said, much awaits the Lyons report because local government needs adequate and independent financial resources. It also needs structures that are effective, transparent, accountable and inspire confidence—and it is on structures that I wish to comment.

First, I shall make a couple of points on internal structures. I very much welcome the more permissive and pluralist tone of the White Paper. Like previous speakers, I, too, raise an eyebrow at elected mayors. There is nothing one could not do as a majority leader than one could in addition have done as mayor, except require the majority leader to persuade—and rightly so.

I also favour annual elections rather than all out because I believe in incremental change rather than swings-of-the-pendulum change. But, again, I welcome the fact that this is a matter for local authority decision- making and I welcome very much the tone of my noble friend’s White Paper today. I still slightly regret the imposition of Westminster style cabinet government on local government committee structures rather than the introduction into Westminster of more effective committee styles because I wanted all of our community to own change and not just the cabinet of the majority party.

Although much less apparent in this White Paper—again I am sure this is to do with the influence of my noble friend—there is still, none the less, the belief that politics has to be conducted in a very macho, male, adversarial style, that it is about conflict, leadership and cabinets, whereas many of us would prefer to talk about consensus, incremental change and committees. I do not think the change of language is necessarily wise. I also suspect that single-member wards—although, again, this is rightly a matter for local authorities—will probably see a reduction in the number of women councillors, currently standing at 30 per cent. I would regret that. But, as I say, the White Paper is about a more pluralistic and consensual tone and it is to be welcomed.

I also welcome the greater permissiveness and pluralism in terms of external structures. I do not think it is any secret that my own local authority, Norwich City Council, hopes very much to become a unitary authority. It was, for 600 years, a county borough until 1974 and would very much like to have the capacity to become, yet again, a unitary and competent authority. Why? Because of the three problems that most face authorities such as my own—the problems of economic regeneration, anti-social behaviour and so-called problem families, and increased longevity and its effect on social care. These problems cut across the current district and shire council—and very often the health service authority—divides. I want to see local authorities with the competence, in a holistic way, to deal with those issues.

At the moment in my city, four different local authorities end up providing different bits of local authority services. How on earth does the local citizen, voter and taxpayer know who does what, to what standard, at what cost and with what accountability? If they do not know and they cannot hold someone accountable, why should they bother to vote? If they do not bother to vote, we see the end of local government.

My Lords, I am very grateful to my noble friend. She has enormous experience in local government and we shall listen carefully to what she has to say over the next few months.

We have addressed in the White Paper some of my noble friend’s anxieties about the cabinet system, not least through the strengthening of the overview and scrutiny committees which, for the first time, will have the powers—rather like a Select Committee—to call for papers and for people to appear before it. These could include the local PCT or a whole range of named partners. It will be a much wider range across local government. The other change will be that they will have a right to expect—and will have to expect—a response to their recommendations. It will not be sufficient for them simply to appear and then nothing happens. So that and the review we will conduct into the capacity of councillors to respond, as part of the democratic renewal, to the call for action—a combination of these plus other things which are in the White Paper—will address some of my noble friend’s anxieties that there is not a progressive structure for local councils to move through in order to, as it were, “train up” for local government.

My noble friend’s point about local government structures is a graphic example of why unitary authorities will bring together disparate functions and end wastefulness. We have said that the invitation to take part in restructuring is a short window, but there is no option for no change in areas where there are still two-tier authorities; they will all be required to improve their working practices. They will be invited also to take part in pathfinder projects where they will be able to test-out new ways of working. I look forward to seeing some of the positive innovation that is already going on made more universal in that way.

My Lords, the key words in the Statement which the Minister has kindly repeated are “strong direction nationally”. There are many words suggesting this is about devolution and decentralisation but I think that most of the proposals—although there are some useful relatively minor things—are about greater central direction; they are authoritarian, centralist and will lead to greater uniformity.

I am a member of a borough council in Lancashire. What got me laughing about the chart on page 37 is that it sets out what any good councillor has been doing almost every day of their life for the entire time they have been on a council—in my case for much of the past 35 years—and I am not quite clear why it needs legislation to tell councillors how to take up issues on behalf of their residents.

I shall focus on the emphasis in the White Paper on local area agreements which, from the perspective of a district councillor in the very large county of Lancashire, are neither local nor agreements; they are, very substantially, imposed from the centre. The negotiations to which the Secretary of State referred earlier in the House of Commons are very one sided. They are conducted on the basis of, “Do this; do it this way and you will get the money. Don’t do this; don’t do it this way and you won’t get the money”. A very large county such as Lancashire runs the risk that if you start including matters such as housing, leisure and so on in local area agreements, you end up with a uniform policy—a one size fits all—for a hugely diverse county, from the Fylde coast, to north Lancashire, to central Lancashire and Preston, to the east Lancashire towns and all the rural areas. There are many such counties where local area agreements are a means by which central government impose their policies, their targets and their wishes on local people.

I do not see much in the White Paper about the right to be different—not the right to be different because needs are different but because different places have similar problems, different solutions are surely relevant. If local people democratically want different solutions, surely that is what local democracy is about. Does the Minister agree that what is in the White Paper militates against that kind of local democratic diversity?

No, my Lords, I do not agree at all. If the noble Lord reads the introduction to the White Paper and the prefaces of the Prime Minister and the Secretary of State, he will find the right to be different written through it in the most powerful and compelling way. I hope this is not a case of the Liberals believing that we have taken over part of their agenda and feeling sore about it. This is a serious attempt to make local area agreements work better. The noble Lord is right that they have not been working as well as they might, partly because they were imposed on top of a lot of other forms and functions. We have responded again to the Local Government Association; it has told us that this is one way to liberate the potential for every local area to live up to what its community wants.

The local area agreement will be a statutory document, but it will be agreed locally. It will be underpinned by the local strategic partnership, which, for the first time, will have duties attached to work with its partners across local government. It is significant that every Whitehall department has signed up to this White Paper, and that is reflected on the ground. This is a radical departure from how things have been done. There will be more pots of money in the local area agreements and more policies to be agreed.

The delivery of social care involves so many different agencies, not least the voluntary and community sector, but we will have a platform and a power to bring these people together. It will be done under the agreed outcomes at national level. We have to have those—they are our national priorities, whether it is higher achievement for young people or better public health. Every local area will have 35 targets which it negotiates itself. That is what will make the difference in the character of the policy and delivery, which will make the difference for local people. The voice of local people will be heard in a way it has not been heard before.

My Lords, I declare an interest as a vice-president of the Local Government Association, although I offer only some personal thoughts. I very much welcome the Government’s commitment to devolve more decision-taking powers to local government and to offer more flexibility, freedom and local choice. It has hitherto been a curiosity, and a rather unsatisfactory one, that the Government’s enthusiasm for devolution to the regions has not apparently been matched by much enthusiasm for devolution to local government. I very much welcome the radical approach that my noble friend has described.

However, that still leaves the looming question: how are the RDAs and other regional satrapies to be made more democratically accountable? Can my noble friend cast any light on that? Can she say how the Government’s policies in that regard would relate to their encouragement to authorities to put themselves forward for unitary status, which is extremely welcome? It must be right that our important historic cities and boroughs should be able to be self-governing and take responsibility for the delivery of the full range of local services.

If we are to strengthen our democracy as a whole, which we surely need to do, must we not nurture democracy at local level? If enough people of real ability and ambition for their communities are to be attracted into local government and—who knows—thence into national politics, is it not necessary to provide scope for them to exercise responsibility commensurate with ability and ambition? Does that not apply to all elected members, not just the leaders of local authorities? Is not this fundamental issue more important than those about particular forms of local government, whether elected mayors, executive cabinets or local authority leaders on long leases?

Can my noble friend tell us whether the very welcome reduction in targets that she has announced means that the Treasury really means to let go, to allow elected local authorities to raise and spend money, free from the stultifying oversight of central government, instead being accountable to local people as citizens and electors and, indeed, possibly to local calls to action? Has the Treasury finally rid itself of the paranoia which possibly had some justification in the 1970s but has been absurd in an age of global financial markets—its fear that an increase in local government borrowing over and beyond what the Treasury decreed as appropriate would cause a rise in interest rates and crowd out private investments? Are we now to allow grown-ups in local authorities, as in private life, to judge what they can afford to borrow?

The phrase “earned autonomy”, which I was glad not to hear from the lips of my noble friend—I think I did not—has expressed too much a post-war view, of which we have learnt to be thoroughly sceptical, that the gentleman in Whitehall really does know best. Can my noble friend assure us that we have now moved beyond that patronising view towards a real respect for local people and local democracy?

Yes, my Lords, I can. The tone of the White Paper is proof of the fact that we bow to the expert and experienced response that local authorities give when they know what their communities need. I think that we would all agree with that.

On my noble friend’s last but one point, we will have to leave the question of funding until we have the Lyons paper in front of us. I am sure that we will have many a serious debate on the implications of whatever Sir Michael comes forward with.

I very much welcome what my noble friend said about the power and scope of local councils and how we intend to build those up. We have to revitalise our democracy. The starting point is to make local councillors feel that there is nothing more honourable or effective than representing their wards and councils. The White Paper will have to do that in a big way.

On the RDAs, we will come forward with worked-out plans for the cities and the city regions. When the previous Secretary of State went around the country, as the present one has, talking to cities and councils, it was about the city and its region and the way in which economic development spills over well beyond the city’s boundaries. The strength of cities and rural areas shows that in addition to the cities’ capacity to grow and be creative and competitive, like our European competitors, the rural areas can benefit in their own special way.

High-level authorities such as oversight and scrutiny committees will be able to call on the RDAs to explain themselves if they so choose, making them more accountable. They are one of the named partners. There is a clear relationship here; we do not intend to diminish the power or capacity of the RDAs. We expect them to work closely and in harmony with cities and city regions when we come forward with those proposals.

My Lords, the Liberal Democrats are very happy for the Government to take up our ideas, but we want to see them implemented well. That is shown by the number of Liberal Democrat Members on our Benches today, compared with those of other parties.

I have two questions. Can the Minister tell us what evidence—I stress “evidence”, as distinct from a propensity for presidential style—the Government have that imposing strong leadership models will commend itself to communities, given the very lukewarm response to the proposition put before us, as my noble friend said? Secondly, when will we get legislation dealing with the standards board and codes of conduct? This issue, quite apart from all the others raised, deserves to have a Bill taken through quickly. If Back-Benchers are to be champions of their communities—it is a sine qua non for every councillor to be a champion of his or her community—they must be able to be involved in planning and licensing matters in a way which is impossible now. In the days when I chaired a London borough planning committee, I do not know how I could have done the job subject to the restrictions which colleagues now face. Will the cost and grief to taxpayers which the standards board is causing come to an end quickly?

My Lords, we are not imposing strong leadership; we are suggesting that there are three models which local authorities can adopt, each of which will give leaders more visibility, accountability and power. However, there is a choice, and there will be a lot to be decided by the local authority.

The noble Baroness asked about evidence. The prime evidence is the confusion which people feel about who is responsible for what. It is extremely difficult to find out what the council does, let alone what the divisions of responsibilities within the councils really mean. I have before me a customer survey on perceptions of local government in England, which shows, for example, that 70 per cent people do not believe that they can influence local decision-making, and that there is a great deal of genuine confusion about everything that local government does and who does it. I would be very happy to send that to the noble Baroness. Paragraph 3.16 of the White Paper refers to another survey which states that the role of the leader was perceived to have become stronger where there was an elected mayor. It showed too that, under the new arrangements, people felt that there had been a better articulation of policy and, therefore, greater satisfaction. I shall send her that information.

My Lords, I am required by procedure to adjourn the House for the lunch-break business. I beg to move that consideration on Report of the Legislative and Regulatory Reform Bill be now adjourned and shall not resume before 3.12 pm. The lunch-break business is not time-limited—I am always nervous when I say that. I know that there are quite a few speakers, but it is assumed that we will try to keep within an hour, out of fairness to the business which resumes thereafter. In moving that Report be adjourned, I give that gentle word of persuasion to the House.

Moved accordingly, and, on Question, Motion agreed to.

Medicines for Human Use (National Rules for Homeopathic Products) Regulations 2006

rose to move, That an humble Address be presented to Her Majesty praying that the regulations, laid before the House on 21 July, be annulled (S.I. 2006/1952). [44th Report from the Merits Committee].

The noble Lord said: My Lords, I declare an interest as the chairman of a charity, Sense About Science, which is concerned with the promotion of good science and an evidence-based approach to the public understanding of scientific issues. The statutory instrument which I seek to annul regulates the marketing of homeopathic products. It was laid before Parliament in July this year, a few days before the House rose for the summer Recess, and there has been no opportunity to debate it. It took effect on 1 September.

Under European law, there was no obligation for the Government to introduce the regulation. EC Directive 2001/83 left it explicitly to nation states to decide how to regulate homeopathy, provided they meet the basic safety requirements of manufactured products. This regulation was made by the Medicines and Healthcare products Regulatory Agency—the MHRA—explicitly for the benefit of the manufacturers of homeopathic products. As the Explanatory Memorandum explains, the law as it stood formerly did not allow new homeopathic products to make claims for therapeutic benefits on their labels and failure to change the law would, in the words of the MHRA,

“inhibit the expansion of the homeopathic industry”.

There was nothing to stop products being sold under what is known as the “simplified scheme” introduced in 1992, but a claim for efficacy could not then be made which was not scientifically tested.

The new regulation, by the way, is concerned solely with homeopathy, not with alternative medicines in general. It has nothing to do with other so-called complementary medicines such as herbal medicines and acupuncture. I mention that because there has been some confusion about it.

There is one very important, absolutely fundamental objection to this regulation. For the first time in the history of the regulation of medical products, it allows claims of efficacy to be made without scientific evidence. It is an abandonment of science and the evidence-based approach. Under this new regulation, the sole basis on which claims of efficacy can be made for homeopathic products quite legally is “homeopathic provings”. There is no need for clinical or scientific tests.

Homeopathy is not based on science and is not a science in any sense whatever. It is a system originally based on two laws proclaimed by the German physician Hahnemann in 1796. The first was that “like cures like”. For this there is no evidence, any more than there is for the medical practice common at the time of suppressing symptoms by the treatment of opposites. However, as treating “like with like” could mean administering a poison, which is not exactly beneficial, he added a second law: the “law of infinitesimals”, which states that the more a substance is diluted, the greater the benefit. Most homeopathic medicines are just about infinitely diluted in water, commonly by 10 to the power of 30—that is, one followed by 30 noughts. What remains is one part in 1 million million million million million. Nothing of the original substance remains.

Not surprisingly, when homeopathic substances have been tested scientifically by double-blind experiments, no evidence has been found that they work any more than as a placebo. This was recently confirmed by a review in the Lancet of more than 100 different studies, which found that there was insufficient evidence that homeopathy is efficacious for any single clinical condition. The mechanism just cannot work. If it does work, it can only be by magic or miracle.

Of course, a placebo can be helpful, because when people believe that something works, it often does—or they get better anyway—but it is the equivalent of witchcraft. Placebos work in odd ways, however. Injections have been found to work better than pills, and blue pills work better than red ones, except in the case of Italian men. However, dependence on the equivalent of coloured water can be harmful if people who are seriously ill believe in it strongly enough to avoid taking orthodox medicine. Some sellers of homeopathic products also make claims that, if acted on, could lead to serious consequences. Recently, Sense About Science exposed the fact that homeopathic remedies were being recommended against malaria—a very dangerous recommendation indeed.

Evidence-based medicine has brought huge benefits to mankind. It is disgraceful that this regulation rejects the evidence-based approach. It undermines the value of a licensing regime. There is still much public concern about tragedies such as thalidomide, and we have gradually improved the regulation of medicines based on scientific evidence. The Medicines Act 1968 was part of this progress. There have been further improvements since. That is what we have come to expect. Now we get this regulation. It is not surprising that it has come as a shock to the medical and scientific world.

Those who support evidence-based medicine in the strongest possible terms know that what is at issue here is the relationship of trust between the public and drug regulation. At Sense About Science, we have been inundated with expressions of concern. These include comments from the Royal Society, the Academy of Medical Sciences, the Medical Research Council, the Royal College of Pathologists and very many other scientific bodies. Let me read just three of the comments, the first from the British Pharmacological Society. I quote it first because two members of the MHRA, including the chairman, have pharmacological qualifications. The society says:

“The British Pharmacological Society believes that any claim for a medicine must be based on evidence, and that it is the duty of the regulatory authorities, in particular the MHRA, to ensure that no claims can be made for the efficacy of any form of medicine unless there is good evidence that the claim is true. Despite many years of investigation, we have no convincing scientific evidence that homeopathic remedies work any better than placebo”.

Please note that that comes from the chairman of the MHRA, himself a professor of pharmacology.

The Royal College of Pathologists made the following statement:

“For the first time in its history the regulation of medicines has moved away from science and away from clear information for the public. The College is deeply alarmed”.

Thirdly, I quote the Biosciences Federation, which represents just about every relevant professional society in this field and has also expressed its extreme concern. It declared:

“The new regulations do not comply with the MHRA’s duty to ensure safety and efficacy of medicines, and to provide clear, honest advice to the public”.

How can the Government ignore these concerns? How could the MHRA possibly justify this regulation? As the Biosciences Federation points out, the MHRA is in breach of its statutory duties, yet no one from that official body has come forward to defend its regulation since it became clear that there is a deep concern in all scientific quarters at what it has done. Both on 1 September and this last week all interviews were refused. That in itself is indefensible, since the MHRA is supposed to be accountable and transparent. Anyway, it is not the business of the MHRA to promote homeopathy or, indeed, any other trade or industry. Its declared aims include helping people to understand the benefits and risks of medical products and to communicate reliable information and advice. Are the Government going to rewrite the objectives of the MHRA to include the promotion of industry? I hope that the Minister will answer that point explicitly.

Can we envisage as a next step that the MHRA will weaken the requirements of scientific testing of drugs, because failure to do so would inhibit the expansion of the pharmaceutical industry? As I said, that is the reason explicitly given for this regulation in the case of the homeopathic industry. What it has done is to promote what is in effect the selling of snake oil. This statutory instrument should be withdrawn—it is a disgrace. I beg to move.

Moved, That an humble Address be presented to Her Majesty praying that the regulations, laid before the House on 21 July, be annulled (S.I. 2006/1952). [44th Report from the Merits Committee].—(Lord Taverne.)

My Lords, it was very easy to predict that the noble Lord, Lord Taverne, would pray against these regulations, for his views on homeopathy are well known. I declare my interest in that I use homeopathy for minor ailments and as preventive measures. I see a qualified homeopath if I have something a bit more complex and I see my GP if I feel that I need his intervention. I firmly believe that those of us who do not wish to clog up our doctors’ surgeries with trivial complaints should be allowed to treat them in whatever way we wish so long as we are armed with accurate information.

These regulations are the result of protracted and wide consultation. They iron out existing anomalies whereby homeopathic medicines that existed before 1971 can carry therapeutic indications on their labels while those registered subsequently cannot. The regulations bring homeopathic medicines into line with the 2005 legislation on “traditional-use” herbal medicines. The information provided is required to be accurate.

Homeopathy is widely used by the general public, who will benefit by being able to choose remedies for minor, self-limiting ailments such as nausea, headache, and the common cold. While there have been no clinical trials for over-the-counter remedies such as cough expectorants, and their efficacy is refuted in the March 2006 51st edition of the British National Formulary, homeopathic medicines have been used for more than 200 years and there is wide bibliographic evidence to support their use and effectiveness. They are safe and, unlike many newly developed drugs for which strict testing is required, have never killed anyone. As the noble Lord, Lord Taverne, should know, the first principle of any therapy is, first of all, do no harm.

The noble Lord complains that homeopathy is not evidence-based. His charity, Sense About Science, claims:

“Evidence-based medicine has been a major public gain of the 20th century”.

I agree that it is essential to protect the public from powerful new drugs, as has been clearly demonstrated by the recent Northwick Park drug trial that nearly killed six healthy young men. But what about the case of the withdrawal of Vioxx, in which the drug, used to treat arthritis, has been estimated to be responsible for between 88,000 and 140,000 extra cases of serious coronary heart disease in the USA?

The evidence base for many conventional medical treatments is still extremely weak. According to the recent British Medical Journal clinical evidence review of 2,404 conventional treatments, only 15 per cent were rated as beneficial, 22 per cent as likely to be beneficial, 7 per cent as a trade-off between benefits and harms, 5 per cent as unlikely to be beneficial, 4 per cent as likely to be ineffective or harmful, and 47 per cent of unknown effectiveness.

Sense About Science claims that homeopathy is not “evidence-based medicine”. This is utterly untrue. Despite a chronic underfunding of research, the effectiveness of homeopathy in many conditions is supported by randomised clinical trials including for childhood diarrhoea, hay-fever, post-operative ileus and osteoarthritis, all of which were the subject of meta-analyses with positive conclusions. It has proved effective with asthma, fibromyalgia, influenza, glue ear, side effects of radiotherapy or chemotherapy, pain, sprains, upper respiratory tract infections and vertigo—each of which has undergone at least two positive randomised control trials—as well as with anxiety, ADHD, CFS, IBS, migraine, PMS, seborrheic dermatitis and tissue trauma, each of which has been the subject of a single randomised control trial with positive results.

In addition, the six-year study at the Bristol Homeopathic Hospital, part of the United Bristol Healthcare Trust and one of five NHS homeopathic hospitals in the UK, published in the Journal of Alternative and Complementary Medicine, involved over 6,500 consecutive patients with chronic diseases. All were referred by their GP or hospital specialist and many had tried conventional medicine first. There is a group of patients for whom conventional chemical treatments either do not work or are contra-indicated. Many find homeopathy helpful. Over 70 per cent of the Bristol patients in this study reported positive health changes after homeopathic treatment.

The noble Lord states that the rules for the regulation of medicines should not allow homeopathic products to make unsubstantiated health claims. Two hundred years of bibliographic evidence, provings and traditional use are not unsubstantiated health claims. A proving is a qualitative research study observing and recording the experience of a group of healthy subjects who experimentally take a particular drug. Contemporary, qualitative, narrative-based research methods, which are becoming increasingly accepted in conventional medicine, are very similar to the techniques used in homeopathic provings.

It seems extraordinary to me that, when faced with a phenomenon like homeopathy which is shown to work, normally credible scientists discard all the findings of numerous scientists such as Preparata, Del Guidice, Kunio Yasue and Louis Rey. Professor Madeleine Ennis of Queen's University, Belfast, with a large pan-European research team led by Professor Roberfroid of the Catholic University, Louvain, set out to show that homeopathy and water memory were utter nonsense. This was an exercise conducted with extreme scientific rigour. The results obtained were statistically significant. This was put down to human error. Professor Ennis then applied an automated counting protocol to the figures. In the end, she had to concede that high dilutions of the active ingredients in homeopathic solutions worked, whether or not the active ingredient was present in the water. She is quoted as saying:

“The results compel me to suspend my disbelief and to start searching for rational explanations for our findings”.

As is the way with the establishment that so readily dismisses evidence it does not like, the Royal Society attempted to debunk these results in a BBC2 “Horizon” programme. The experiment appeared on television but the findings were never published in a proper scientific journal, unlike Professor Ennis’s research. The 1994 publication in the Lancet of the results of the double-blind placebo controlled studies conducted by Dr David Reilly in Glasgow, which showed that homeopathy worked for asthma, were accompanied by an editorial comment:

“What could be more absurd than the notion that a substance is therapeutically active in dilutions so great that the patient is unlikely to receive a single molecule of it? Yes, the dilution principle of homeopathy is absurd; so the reason for any therapeutic effect presumably lies elsewhere”.

Perhaps the noble Lord, Lord Taverne, and his Sense About Science friends could be persuaded to suspend their disbelief for a while and, instead of looking for a biochemical answer, look for a nano-pharmacological or a bio-physical one. Quantum physics provides a tauntingly fascinating window on life and it may just be that, instead of opposing something that he does not understand, his eyes will be opened to a set of totally new concepts. I remind the noble Lord of a speech he made on 24 June 2004, at col. 323 in Hansard. He might recall that he was critical of radiation safety standards. In advocating the benefits of low doses of radiation he described an effect known as hormesis. The toxicological definition of hormesis is:

“A dose response phenomenon characterised by a low dose stimulation, high dose inhibition, resulting in either a J-shaped or an inverted U-shaped dose response. A pollutant or toxin thus has the opposite effect in small doses than in large doses”.

If that is what the noble Lord believes, he should be well on the way to accepting the principles of homeopathy.

I am glad that the Government have agreed to bring in these regulations. The range of products is limited to the treatment of relatively minor, self-limiting conditions. The regulations will bring uniformity to complementary medicinal labelling and provide consumers with informed choice. I ask the Minister to resist the Prayer of the noble Lord, Lord Taverne.

My Lords, my question for my noble friend the Minister concerns referral to NICE of homeopathic remedies. I should declare my interests as an ex-professor of medicine and ex-president of the Royal College of Physicians.

I can well understand the Government’s desire to try with these regulations to remove some of the confusion that can arise in the public’s mind, given that homeopathic water marketed before 1971 as a remedy could include an indication of what it was meant to treat, while water marketed after that date could be said only to be safe. Now we have the possibility that water that has been subjected to a “homoepathic proving”, in the words of the regulations, can have indications attached. It is unclear to me whether homeopathic proof is simply proof that is so dilute that none of the original is left, or something else. One way to find out is to refer this whole question to NICE so that it can examine it properly. Can I persuade my noble friend to refer homeopathic remedies to NICE?

Then there is the question of reporting of adverse events. That can be best illustrated by the case of homeopathic remedies for malaria, where I understand that patients seen at the Hospital for Tropical Diseases have had their definitive treatments delayed because they have been taking homeopathic remedies. That is a dangerous side effect of homeopathy, albeit indirect: it delays curative treatments. The problem here is that such reports go unreported, either through the adverse events system or through the drug side-effects route. Will my noble friend consider how such potentially dangerous effects of homeopathy can be reported in a systematic way?

My Lords, I am glad the noble Countess is able to enjoy the benefits of homeopathic remedies, even if she does not know why. I find these regulations very disturbing, as the noble Lord, Lord Taverne, has already outlined. I referred back to Complementary and Alternative Medicine, the report in November 2000 of the Select Committee of this House chaired by the noble Lord, Lord Walton of Detchant. It is, as so many of these reports are, a mine of information and advice. In the summary of recommendations, the committee reported:

“In our opinion any therapy that makes specific claims for being able to treat specific conditions should have evidence of being able to do this above and beyond the placebo effect. This is especially true for therapies which aim to be available on the NHS and aim to operate as an alternative to conventional medicine, specifically therapies in Group 1”.

The House will no doubt be aware that homeopathy was listed by the committee in group 1.

However, looking through the report for greater clarification, I read that: “Many CAM”—that is, complementary and alternative medicine—

“therapies are based on theories about their modes of action that are not congruent with current scientific knowledge. That is not to say that new scientific knowledge may not emerge in the future. Nevertheless as a Select Committee on Science and Technology we must make it clear from the outset that whilst we accept that some CAM therapies, notably osteopathy, chiropractic and herbal medicine, have scientifically established efficacy in the treatment of a limited number of ailments, we remain sceptical about the modes of action about many of the others”.

It is noteworthy that the Select Committee did not include homeopathy in that list. That report was published six years ago. Has anything changed since then? Would a Select Committee looking at that today have included homeopathy in the list with the other treatments mentioned?

I turn to the question of research. I listened to the noble Countess with great interest. I hope the Minister will be able to confirm or comment upon what she said. The report says in chapter 7, “Research and Development”:

“To conduct research into CAM disciplines will require much work and resources, and will therefore be time-consuming. Hence, we recommend that three important questions should be addressed in the following order:

(i) To provide a starting point for possible improvements in CAM treatment, to show whether further inquiry would be useful, and to highlight any areas where its application could inform conventional medicine—does the treatment offer therapeutic benefits greater than placebo?

(ii) To protect patients from hazardous practices—is the treatment safe?

(iii) To help patients, doctors and healthcare administrators choose whether or not to adopt the treatment—how does it compare, in medical outcome and cost effectiveness, with other forms of treatment?”.

Has this research been done on homeopathy? If so, where, by whom and with what results? Has it been peer-reviewed? I hope the Minister will be able to answer those questions in his reply.

My central objection to the new regulations is that by bending the rules—the reference to “proven” results is quite different from the normal rules about effectiveness and safety—they appear to give an official imprimatur to treatments for which there is no scientific evidence of safety and efficacy. I find that very disturbing, as did the noble Lords, Lord Taverne and Lord Turnberg. I hope the Minister will be able to reassure the House.

My Lords, the Royal Society, of which I have the honour to be president, believes that all complementary and alternative medicines should be subject to careful evaluation of their efficacy and their safety. All treatments so labelled should be properly tested and patients should not receive misleading information.

There are no great concerns about the safety of homeopathic treatments. What is at issue is their effectiveness. Obviously placebo effects can be powerful, nobody denies that. It is, however, quite different to assert that homeopathic treatments offer benefits beyond a placebo. Indeed, if medicines can really work even when so diluted that barely a single molecule is left, this would entail some fundamentally new scientific principle with amazingly broad ramifications. It would mean that materials like water carry imprints of their past and can remember their history, as it were, in some quite novel and mysterious way. If that were the case, it would have fundamental implications for precise experiments over the whole of science.

So it seems to me that the burden of proof on homeopathic remedies should actually be higher, not lower, than for conventional ones. Extraordinary claims demand extraordinary evidence. To put it mildly, so-called “homeopathic provings” seem to fall far short of that. That is why I wholeheartedly support what the noble Lord, Lord Taverne, is saying on this issue.

My Lords, patients tend to use complementary medicine as a supplement to orthodox medicine. There is less emphasis on symptoms and the treatment is usually highly individualised. Whether the treatment is herbal, essential oils, acupuncture or homeopathic, it will be influenced by the patient’s personality and lifestyle as much as by the problem that is presented.

Given the massively high levels of iatrogenic disease and morbidity from orthodox treatments, I am astonished that the noble Lord, Lord Taverne, can dismiss homeopathy in such a frivolous manner. He and my noble friend Lord Jenkin imply that homeopathy can be harmful. I sat on the Select Committee to which the noble Lord referred and although I do not have the papers in front of me, I believe we felt that as homeopathic medicines were basically water, they could not be harmful.

Each year in the UK, about 850,000 adverse effects are caused by orthodox medical treatment. I am sorry to say that 120,000 of these are deaths. How can the use of homeopathy compare with this? Where is the logic of dismissing treatment by a homeopathic product which has never directly caused a death and, when analysed, is shown to contain no active ingredient? Is it not unscientific to abandon treatments that are valued and desired by patients or to dismiss treatments that a particular lobby just does not like?

To say that homeopathy is not evidence-based is completely untrue. Despite chronic underfunding, a substantial body of evidence exists to prove the effectiveness of homeopathy. Now is not the time to list them. The noble Countess, Lady Mar, mentioned some and the evidence is available. I went on a course about 15 years ago on the relationship between quantum physics and homeopathy. I probably did not understand a word I was told at the time, but at least there was evidence that the two were linked.

If homeopathic treatments are harmful, why is there almost total absence of any negligence claims to prove the point? Any case against homeopathy must rest on the argument that the most innocuous of practices may be harmful if they prevent the patient from seeking other more appropriate treatment. Despite the persistence of this line of attack and the anecdotal stories we have heard today, there is no firm evidence to support it. The homeopathic approach helps patients for whom conventional treatment has been unsuccessful or has unacceptable side effects.

It is interesting to consider why homeopathy, which of all complementary therapies is probably at most variance with orthodox medicine, should have received sufficient support from the Government to be able to maintain a number of specialised hospitals.

The new regulations clear up an anomaly and bring the UK into line with other countries and the 2005 legislation on the traditional use of herbal medicines which allows a herbal product with 30 years’ traditional use to include indications based on information obtained from its long-standing use and experience.

Companies will now be encouraged to register new homeopathic medicines, with the option of reregistering certain existing products, and will be allowed to include information about the treatment and relief of minor, self-limiting conditions based on the use of the product within the homeopathic tradition. The legislation will benefit the ever-growing number of users of homeopathic medicine, and its provisions will encourage growth in the range of products in the market and enhance the consumer’s understanding of their benefits.

Homeopathic medicines have been used for more than 200 years and there is wide evidence to support their use and effectiveness, placebo effect or not—and I have no problem with the placebo effect. They are safe and have never killed anyone, unlike many newly developed drugs for which strict testing is justifiably required. I must resist the Prayer.

My Lords, it is always interesting to follow my noble friend Lord Taverne in a debate. I look forward to taking part in debates with him as he is not only an incredibly knowledgeable but a very passionate speaker.

It is important not to lose sight of what we are talking about here. We are talking about remedies for minor self-limiting conditions, such as travel sickness and muscular pain. Most of the orthodox equivalents for those conditions would be over-the-counter medicines, which probably have efficacy rates that are equally contentious.

It therefore seems to me that the principal matter we should address is the extent to which these products are deemed to be safe and the claims that are made about them. I agree with what my noble Lord, Lord Rees, said in his introduction, although perhaps not with his conclusions.

My reading of the order before us is that an extensive process is set out by which product manufacturers are required to demonstrate safety. There is an inherent dilemma in the questions my noble friend Lord Taverne poses to the homeopathic world. While he dismisses their products as being ineffective and not scientifically proven, he then asks for scientific proof. I would imagine that those on the other side of the argument would point out that that is an impossible thing to ask. They cannot, and perhaps do not wish to, prove what they do in scientific terms. I am struck by the extent to which we have to try to keep a sense of equivalence in all of this. The noble Lord, Lord Turnberg, made an interesting point about the extent to which homeopathic remedies might make people present late for conventional treatment. The same accusation might well be levelled against conventional orthodox treatments of a minor nature. That is one of the difficulties we have.

The principal question I want the Minister to answer is: what would have been the effect on public health and the health of individuals had this measure not been tabled and had the MHRA not set out the requirements that it has? Leading on from that, the key question for all of us is what the consequent marketing authorisations will be for these products. What claims will manufacturers be able to make for them? The phrase “for the relief of” has already been mentioned. That phrase is used by those whose products for treating minor conditions such as flu are of a more conventional nature. I am not sure that they are any more effective.

It is important that we know precisely what the marketing authorisation will be. What statement will manufacturers be able to make as a result of their product meeting the regulations? That issue was mentioned in the papers that we have been given. I note that in the consultation on the regulations there seemed to be a body of opinion that a product which had been through this process could be marketed as an anthroposophic medicinal product. I sincerely hope that that is not the case as that would be highly misleading for the general public. If as a result of going through these processes, a statement can be made that a product is based on homeopathic assessment, that is fair and reasonable. It is accurate and does not claim to be done on a scientific basis.

There is agreement—whether negative or positive—that on balance homeopathy does no harm. Certainly its efficacy is unproven. We need to be sure that the measure does not open the way for product manufacturers to take greater licence than they should on making efficacy claims for products and regarding the basis of those claims. If the noble Lord can answer those questions, I shall be content for the measure to proceed.

My Lords, as the noble Lord, Lord Taverne, has said, if a patient has faith in a remedy, it is perfectly possible for their symptoms to be relieved, so long as they are not serious. If, in addition, the patient is made happy by that, his immune system will work better. There is good scientific evidence on that.

One of the problems with this whole subject is that it is bedevilled by various organisations putting forward explanations for how these alternative therapies work. I mention acupuncture en passant. There is no doubt that acupuncture works, probably through releasing endorphins. But this business of there being special tracks and of having to insert the needle in special places is not so. You can stick them in anywhere and the effect is still the same. In reflexology you will see a diagram of the foot and various areas described as the lung area, the heart area and various other areas. What a pity that these strange explanations are given. Why do they not say, “If you’re feeling ill and a beautiful young lady comes along and rubs your foot, you will feel better”? That is perfectly acceptable.

Having said that, alternative therapies have been shown to help with diseases such as multiple sclerosis and cancer, as NICE has reported. Homeopathic remedies have specifically been proved to help women with PMS. Even if homeopathic medicines cannot be proved to be positively effective, at least they do no harm, as has been argued already.

The EU directive, which we were not obliged to enforce, states that, in order to acquire marketing authorisation, a herbal product must have been used in medical practice for at least 30 years, with 15 of those years having been in the EU. This directive covers only products that are taken orally, used externally or inhaled. It has obviously been forgotten that there is another route for medicines, especially in France. Does the Minister have any information on that?

Article 8 requires that the decision to license a medicine is based on the quality, efficacy and safety of the product. The fees for gaining a licence for a product will vary according to the number of active ingredients. As some products contain large numbers of ingredients, this could prove very expensive. How will it be decided which ingredients are active?

Under the directive, the efficacy of traditional herbal medicinal products does not have to be supported using clinical studies. That is a great pity. The pharmacological effects and efficacy must be shown to be plausible on the basis of long-standing use and experience. How will NICE define “plausible”? NICE determines all its decisions on the use of drugs on an analysis of their cost and clinical effectiveness and believes that homeopathic medicines should be treated in exactly the same way as traditional medicines in deciding whether the NHS should provide them to the public. What advice is the Minister now giving to NICE on this aspect?

The Conservatives believe that the NHS should not exclude alternative therapies. If the NHS rules out providing a herbal therapy, it should do so only on the basis of indisputable evidence, as is the case with all other conventional medicines. Equally, if the NHS decides to provide a particular treatment, this should again be done on the back of evidence. We see the most effective route as the cost-clinical effectiveness criteria which NICE employs in the decision-making process on drug regulation and use. We have always said that as long as these remedies have been proven to be safe, they should be available to buy. Consumers are then free to make their own assessment.

My Lords, I declare an interest as a trustee of Sense About Science. I believe that the public damage in these regulations does not lie in the circulation of homeopathic remedies but in the diffusion of the standard for the evaluation of remedies. It seems to me that NICE is the one body that can arbitrate in this area. I hope that the Minister will respond to the question of the noble Lord, Lord Turnberg, on the role of NICE in this matter.

My Lords, one of the great joys of being a Health Minister in this House is that I am treated to a wide range of views. I am often strongly encouraged to support rather conflicting views.

I shall try to confine my remarks to making clear the Government’s role in the regulation of homeopathic products and explaining the aims of the new national rules scheme, about which there may be some misunderstanding, given the remarks made in the debate. I bow to the professional knowledge of the noble Lord, Lord McColl, on which orifice to use for which medication.

The use of homeopathic products in this country has a long tradition, as a result of which a wide range has been available and regulated in the UK for many years. Homeopathic products have, for example, been available in the NHS since its inception in 1948. Successive Governments have accepted that homeopathy has its place within the range of treatment options available to patients. That is a historical fact. This Government strongly believe that consumers in the UK should be free to make informed choices about their care, and that includes the freedom to choose homeopathic products. Whether such products are supplied and paid for by the NHS is, under current funding arrangements, for local NHS service providers and primary care trusts to decide. That is exactly the same system that was in place when the noble Lord, Lord Jenkin of Roding, was a distinguished Secretary of State for Health.

These new regulations flow from new EU medicines legislation, but it is optional to member states whether they bring it in. This Government have chosen to introduce the new scheme because it will improve the regulation of these products in the UK while continuing to support the principle that consumers should have the right to choose to use them if they so wish. Apart from Denmark and France, we are the only EU country so far to have introduced this scheme that will improve the protection of consumers who choose to use such products, and we have acted in patients’ interests, not in the promotion of commercial products.

Because homeopathic products are different from conventional medicines, it is right that they are regulated differently. Their efficacy cannot be demonstrated in the same way as is required for conventional medicinal products to obtain a licence, but that does not mean that homeopathic products should not be available. Having listened to the debate, I am not entirely clear how such products could ever demonstrate efficacy if they were totally banned. That would be a challenging scientific proposition.

The new national rules scheme that this Government have introduced provides an appropriate regulatory scheme that will improve how many current homeopathic products are regulated. The new scheme continues to give consumers assurances of quality of manufacture and of safety and will provide them with better information about the products available. It develops existing arrangements, which involve two types of registration. The first is for homeopathic products that were on the market when the Medicines Act came into force in 1971 which have product licences of right (PLRs). When these products were included in that scheme in 1971, producers were allowed to label their products to say what they could be used for. Many of those products are still on the market today.

The second regime is called the simplified scheme, which was introduced in 1992, when the EU first produced legislation for homeopathic products. New products coming on to the market since then have had to comply with those EU rules or with all the rules for conventional medicines, which of course would require them to demonstrate efficacy through clinical trials. Homeopathic products clearly could not do that. Moreover, the scheme’s products may not be labelled to say what they are for—that might be a disadvantage for users. In answer to the noble Baroness, Lady Barker, those existing regulations would continue if these new regulations were not introduced.

The introduction of the new national rules scheme offers an alternative approach that will bring a number of benefits for patients. First, it will, for the first time since the PLR scheme in 1971, allow homeopathic products to be marketed with information to the consumer about what they can be used for. This will provide better information to the consumer and reduce the risk of confusion. We expect that some products currently authorised under the simplified scheme will be switched because they will, for the first time if they qualify, be allowed to be labelled as suitable for the relief of specified conditions. However, to qualify for authorisation under this scheme, the manufacturer has to show, from literature, that there is a tradition of use of that product for a particular purpose. So an evidence base is being used, although it may not satisfy everyone who has spoken.

Secondly, homeopathic products authorised under the new national rules scheme are required to comply with all aspects of the conventional medicines regime, except the requirement to demonstrate efficacy through clinical trials. That will bring significant benefits: improved assurances of quality in manufacture, safety, the review of information given to consumers, and the requirement to submit regular safety reports to the regulator and to submit to inspections. All those elements should reassure consumers, as the measures will enhance safety for those who choose to use homeopathic products.

Thirdly, and importantly, the new national rules scheme provides a possible regulatory home previously not available when we had only the simplified scheme or a full licence available for the products with product licences of right. The MHRA intends to review all the PLRs in the next seven years to ensure that they are of appropriate quality and safety. The MHRA will allow only products authorised under the new scheme to be labelled as suitable for the relief of minor symptoms or conditions—as the noble Baroness, Lady Barker, made clear—products that you would expect to see available on general sale in, for example, supermarkets.

This measure, while maintaining consumers’ freedom to choose to use homeopathic products, will ensure that such products are better regulated and provide more and better information to the consumer. Furthermore, a mandatory statement will be included in the pack instructing the patient to consult their doctor if symptoms persist. Again, that is a new measure that directs people towards conventional medicine if there is a problem.

The Advisory Board on the Registration of Homeopathic Products, a committee established under the Medicines Act to advise Ministers on matters concerning homeopathic products, will be instrumental in providing advice on the indications for, and safety and quality of, products registered under the new scheme, and on the review and rationalisation of PLRs. In last year’s review of the medicines advisory committee, the advisory board was given a new and enhanced role to advise the Government directly on matters relating to homeopathy. It is an independent committee whose membership includes homeopathic practitioners, and people with a wide range of clinical expertise, including GPs, paediatricians, toxicologists and pharmacists.

The noble Lord, Lord Taverne, suggested that the Government are bowing to commercial pressure from the homeopathic industry in introducing this scheme. This is absolutely not the case. I have had meetings with the homeopathic industry, and I do not think that it sees us in the light that has been described this afternoon.

As I have explained, the Government believe that the new national rules scheme provides a significant opportunity to improve consumer information about the use of homeopathic medicinal products on the UK market while maintaining rigorous control over their quality and safety. That will be welcomed by consumers who choose to use those products for minor conditions or illnesses.

Unfortunately, a number of remarks have been made about the MHRA. It is not in breach of its statutory duties, nor does it promote homeopathic products on behalf of the industry that sells them. Having worked with the MHRA as the Minister responsible for it for two years, I regard it as a distinguished public body that has done a great deal in this country to protect the public through the regulation of medicinal products in a scientific way. The MHRA has a role in not only authorising products on grounds of efficacy, but ensuring that safety and quality standards are maintained. It is not concerned purely with efficacy.

We accept that this scheme does not provide any endorsement of clinical efficacy as happens with conventional medicines. It is not designed to replace the use of more conventional treatments, which is why it is restricted to products for the relief of minor conditions that do not require medical intervention. Central to our policy was the inclusion of a statement in the product literature advising patients to consult their doctor if symptoms persist. I believe that the scheme will enable consumers to make more informed choices about the use of homeopathic products, and the regulatory regime will ensure that standards of quality and safety are maintained in the production and use of homeopathic products.

That stance in no way diminishes the Government’s support for evidence-based medicine or for scientific research into new pharmaceutical products that benefit patients. We have done much as a Government to support science and research, and will continue to do so. Homeopathic products are, however, in a different category. Provided that such products are safe, properly manufactured and clearly labelled without making false claims, which they will be under the new national rules scheme, patients should not be denied access to them for the conditions to which they relate.

A number of noble Lords, including my noble friend Lord Turnberg, raised the issue of NICE. The Government have no plans to refer homeopathic remedies to NICE at present. I gently draw noble Lords’ attention to the fact that NICE has quite a few things on its plate at the moment, including many potentially life-saving drugs. However, there is nothing to stop the use of the yellow card scheme, authorised under the new national rules scheme, to be applied in respect of adverse effects to homeopathic products, as is the case with conventional medicines.

I believe that this is an area where we have to regulate in the way that we have done but, in our view, we must not deny people the right to use these medicines when they are safe, manufactured to an appropriate quality and properly labelled. These are good regulations that should be on the statute book.

My Lords, it would be inappropriate to reply to the various issues raised in this debate, but I must make a few very brief points. The intention of this Prayer is not to ban the sale or diffusion of homeopathic products but to stop regulation that allows claims of efficacy which do not have scientific proof and which encourage people to believe that homeopathy works in a way that cannot be proved. That could have, and has had, serious effects in some cases.

I am extremely disappointed by the Minister's reply because he has not denied—indeed, he could not deny—that these regulations turn their back on the entire history of the regulation of medical products in which such products have been scientifically proved. Nor did he answer the question about the interests of the homeopathic industry—indeed, he denied that the regulations had anything to do with that.

Perhaps I may read the appropriate sentence from the Explanatory Memorandum attached to these regulations:

“Although the development of national rules … under the … Directive is optional, failing to introduce the scheme would inhibit the expansion of the homeopathic industry”.

If that does not mean that the purpose of the regulations is to assist the homeopathic industry, I do not know what it means.

I should also like the Minister to look again at the whole role of the MHRA, which has now abandoned its purpose of guaranteeing the safety and, in particular, the efficacy of its products.

I am afraid that the noble Lord’s reply will not reassure the numerous—in fact, almost comprehensive—list of medical bodies that have expressed extreme concern at the MHRA’s change of tack. His reply was feeble, and I am sorry to say that the reply from my own Front Bench was equally feeble. If they are to be taken seriously, perhaps sometimes they should apply a little intellectual rigour.

I understand that it is not customary to have a vote on a Prayer of this kind. We shall continue, as I am sure will many others, to press for these regulations to be withdrawn. I hope that the Government will give further thought to them, but I beg leave to withdraw the Motion.

Motion, by leave, withdrawn.

Legislative and Regulatory Reform Bill

Consideration of amendments on Report resumed on Clause 3.

[Amendment No. 17 not moved.]

Before Clause 4, insert the following new clause-

“INDEPENDENCE OF THE ECONOMIC REGULATORS

(1) An order under this Part may not restrict the jurisdiction or undermine the independence of any economic regulator.

(2) For the purposes of this section-

(a) restricting the jurisdiction of any economic regulator includes diminishing, removing or transferring to another person any function conferred on or exercisable by an economic regulator; (b) undermining the independence of any economic regulator includes imposing on an economic regulator an obligation to comply with the wishes of- (i) a Minister of the Crown; (ii) a person who owes such an obligation to a Minister of the Crown; or (iii) a person who is controlled by a Minister of the Crown. (3) An order under this section may not render a person who is a director or member of an economic regulator removable from office on grounds other than those which were in force on the date on which this Act was passed.

(4) In this section, “economic regulator” means any of-

(a) the Gas and Electricity Markets Authority; (b) the Office of Communications; (c) the Office of Rail Regulation; (d) the Postal Services Commission; (e) the Water Services Regulation Authority; (f) the Office of Fair Trading; (g) the Civil Aviation Authority.”

The noble Baroness said: My Lords, I thank my noble friend Lord Norton of Louth, as this is a slightly modified version of the amendment that he tabled in Committee to great acclaim. I am also very grateful for the support given by the noble and learned Lord, Lord Lloyd of Berwick, to my previous amendment on this issue.

The economic regulators have been given statutory powers and duties for the benefit of us all. Their effective regulation of the networks and infrastructures that provide us with electricity, water and transport is critical for our safety and the reliability of crucial services. It is essential that industry continues to invest in the services in order to maintain and improve their quality. This investment will be put at risk if there is the slightest danger of political interference. At previous stages of the Bill, I reminded this House of the Government's behaviour towards the Rail Regulator during the winding up of Railtrack. We need no reminder that in the past economic regulators have been, and may well be in the future, the target of pressure from politicians.

In Committee, the Minister attempted to reassure us by promising consultation, yet we have all seen countless orders forced through both this House and another place in the face of enormous opposition from consultations and committees. Equally frequently, the Government have ignored advice and warnings from parliamentary committees. I am afraid that I do not share the Minister’s faith that future Ministers will consistently adhere to his undertaking not to pursue controversial orders and not to undermine the independence of the regulators, welcome as these undertakings are.

I was contacted by a member of the Government’s Better Regulation Commission who was worried that my amendment would allow the economic regulators to impose bad regulation on already overburdened businesses. I have written to the member of the commission to reassure him that the amendment would not let economic regulators off following good regulatory practice. Instead, it would ensure that major changes to the regulators were given the full scrutiny that matters of such financial significance to every man and woman in this country deserve.

We have seen the Government twist and turn to avoid taking the blame for the mountain of red tape burying business in this country today. It is time that they stopped arrogating more and more powers to themselves, while doing nothing with the powers that they already have. They should clean up their departments and break their addiction to government interference. I beg to move.

My Lords, in supporting this amendment, I wish to reiterate two points that I made in Committee. It is important to stress the independence of the economic regulators and the fact that that independence is not achieved at the expense of accountability.

Regulators have to explain and justify their actions. In the Constitution Committee’s report, The Regulatory State: Ensuring its Accountability, the point was made that regulators are subject to what was termed “360 degrees of accountability”. They are answerable to a range of bodies, including Parliament. They are bound by statute and can be challenged if they exceed their powers. Stipulating the independence of regulators does not affect the powers of Ministers to determine policy.

The importance of maintaining the independence of regulators has been variously stressed, including by the Government. In Committee, I quoted from the evidence submitted to the Constitution Committee by the Department of Trade and Industry. The department said that,

“the independence of economic regulators from Government—insulating decisions from short term political factors—is a fundamental contributor to regulatory certainty and prerequisite for continuing to attract private finance to regulated sectors”.

There is thus a compelling case for protecting the independence of regulators—and to be seen to be so doing. That was the case that I advanced in Committee, and my amendment is designed to ring-fence that independence.

I listened with care to the Minister’s response in Committee. His reasons for opposing the amendment were twofold. One was that the provisions of the Bill did not create a new position. Regulatory reform orders under the 2001 Act could be used to change the functions of the economic regulators and the provisions of the Act, he argued, had not led to any uncertainty. The second point was that the provisions allowed for flexibility subject to parliamentary scrutiny.

The first point I do not find compelling. I was a critic of the 2001 Act, and the fact of carrying over existing provisions is no commendation. It has not led to market uncertainty because the powers have not been used in a manner that is contentious. My fears about the provision are more apparent if I rephrase that and say that the powers have not yet been used in a manner that is contentious. If the order-making power were to be employed to try to limit the independence of regulators, it may be blocked by Parliament, but the damage would already have been done. If tried once, the potential is always there, and markets thereafter may be far more wary. The point that has been variously stressed, not least by my noble friend Lord Onslow, and which the Government appear to have difficulty in accepting, is that a Government cannot bind their successors.

The other point developed by the Minister is essentially one of convenience. He cited an example affecting the FSA. I counsel against generalising from an N of one, which seems to have happened an awful lot in discussing this Bill. I am not sure that we should concede the general point of enabling primary legislation to be amended by secondary legislation because there is one example of that proving useful. The potential for creating even one case of misuse should concern us.

The Minister’s argument, which is at the heart of what I find worrying about the Bill, is that because circumstances change, there may be a case for changing the functions of the regulator and this could conveniently be done by secondary legislation. In other words, it is an admission that we did not get the legislation right the first time round. Had we done so, there would have been appropriate provision in the Act for amending regulatory functions. We need to think through what this may entail for the Government’s approach to primary legislation in future.

I revert to the point that I made earlier. I believe that it is important to protect the independence of regulators and to be seen to be doing so. That combined with my somewhat purist view of primary legislation means that I am very happy to support my noble friend’s amendment.

My Lords, I have added my name to the amendment because I believe, as the two previous speakers have said, that the question of independent regulation is fundamental not only to regulating monopolies but to attracting private finance.

I shall speak mainly about the railways, because that is what I know most about, and I declare an interest as chairman of the Rail Freight Group. In that sector, £1.5 billion of private investment has been made since privatisation. This industry likes regulators; it does not feel that they are a constraint. It likes them because regulators give certainty and confidence. Independent regulation is fundamental not only to attracting investment, but to avoiding, as others have said, the interference and shocks which would have a disastrous effect on business confidence. Even while this Bill is going through your Lordships’ House, the Government have introduced a Bill to build a railway called Crossrail—many noble Lords will know about it—which does exactly what the Legislative and Regulatory Reform Bill seeks to do, but for one particular project.

Clauses 22 to 44 of the Crossrail Bill allow the Government to direct the Office of Rail Regulation to do as it wants—to trample over the rights, obligations and business prospects of other operators and users of the railway on the surface. I am sure that your Lordships will consider that Bill in due course if it gets through the other place. Even while Ministers are saying that this is all covered, the Government are already trying to constrain the independence of a regulator. Having more or less failed to do so on one type of timetabling with Crossrail in the summer, they have now come back and said that all the timetabling work—and therefore how much investment there is and how many trains can run—will be decided by the rail regulator in accordance with industry processes. Everybody will say that that is fine, until you go back to Clauses 22 to 44 and find that, if the Government do not like the regulator’s answers, he can be directed to give different ones.

That is unacceptable. The Government should say, “Yes, there was a problem”, possibly when Railtrack when into liquidation. People said, “Ah, the regulator is going to milk the Treasury dry”. I do not believe that. Since then, however, Parliament has passed the Railways Act 2005, which puts a little constraint on the independence of the regulator by saying that the Office of Rail Regulation must have regard to the funds available to the Secretary of State for the railways. That seems perfectly fair, but still emphasises the independence of the Office of Rail Regulation in deciding how those funds should be spent.

I could give a lot of quotations from the passage of that Bill through your Lordships’ House in which Ministers emphasised the importance of independent rail regulation. If any noble Lord wants those, I can see them afterwards. I do not need to quote them now, but Ministers emphasised the importance of independent rail regulation at least three times at various stages.

We do not need this particular section of the Bill for the railways. It would be very worrying if it is passed as it is. I therefore support the amendment, which is designed to stop the Government interfering in the work of independent regulators when the legislation is already there.

My Lords, I would have been happy to add my name to this amendment, but I am afraid that I was too late to do so. It seems a well drafted amendment, achieving what is needed in simple language that we can all understand.

I take it that we are all agreed that the independence of economic regulators must be secured and protected. They cannot do their job properly if they are liable to be leant on, especially by the Government. As I understand it, the Government accept that position. In his reply in Committee, the Minister said that the Government would be willing to give an undertaking that the independence of the regulators would not be undermined. That being so, I am at a loss to understand how they can object to this amendment.

I have reread the reasons given by the Minister with great care, and can find only two in addition to those detected by the noble Lord, Lord Norton of Louth. The first that I hit on—at col. 1343 of Hansard on 19 July—was that the amendment would impose “an unnecessary restriction” on the regulators themselves. I find it difficult to envisage any regulator who wanted to undermine his own independence. The second reason was that the amendment would provide no additional protection, because the regulator could always be sacked for incompetence or misconduct. I find it impossible to follow that reasoning and I hope that the Minister will explain it in due course. In the mean time, I hope that the House will support this excellent and necessary amendment.

My Lords, I simply want to ask a question about this amendment and raise some issues. It seems inappropriate that an amendment such as this should be limited to economic regulators. The same principles apply to other regulators across the board. If this amendment were accepted for economic regulators, some of us in other fields might come forward at Third Reading with further suggestions.

I declare an interest as a regulator, being on the board of the Food Standards Agency and the deputy chair of the Meat Hygiene Service. The Food Standards Agency welcomes the structures introduced by the Government to develop better regulation. Even so, we were extremely concerned about the Bill in its earlier form. We accept assurances, which we hope that the Minister will reiterate, that the powers in the Bill will not be used to substantially amend or abolish the powers of any regulator without proper parliamentary scrutiny and consultation. I have heard the Minister say that on a number of occasions, having sat through the debate this morning.

It is not only the economic regulators that wish to retain their independence. The Food Standards Agency is held in high regard and respect by the public and there is greater confidence in food standards. That position was reached through the FSA’s transparency and focus on consumers. The FSA has a statutory foundation and statutory powers. I do not need to remind the House of the lack of confidence in food following the BSE crisis and the work that has been undertaken to take us to the position that we are in now.

In no way should the Bill favour economic regulators. If it is going to provide for independence, it should look across the board at regulators that have highly successful records, which are monitored in tables of success. We look for a level regulatory playing field. If the Minister can assure us about that in his reply, we may not come forward with further proposals, but if this amendment is accepted, we will be back at Third Reading.

My Lords, I shall speak about the railways. The situation that pertained at the time of the collapse of Railtrack is not the best guide. That was a time when we had very individual regulators who were not subject to regulatory boards. Since regulatory boards have been put in place, there is much less likelihood of a falling out between the Government and the regulators. However, it would be an advantage if, when the Government wish to make changes, they sought the agreement of the regulator or his board; if they do not receive that agreement, they should seek fresh primary legislation so that the matter can come before Parliament not as an order, but in a form in which it can be debated thoroughly.

My Lords, I agree with the points made by the noble Baroness, Lady Harris. I do not support this amendment because the list is too short and it would probably be impossible to write a long enough one to satisfy me. The major statutory regulators, for whom independence is important, also deserve some protection from major interference with their roles and purposes—indeed, with their very existence—by secondary legislation. The Minister judged that my previous intervention on this issue—in Amendment No. 9—was not at the right point. I hope that this is the right point and that he will give me the assurance that I sought then that order-making powers are not intended to erode the independence, the role or the existence of major regulators that were established by primary legislation.

My Lords, I listened to the arguments on this with great care and it is obviously a difficult issue. However, on balance, I am persuaded by those who support this amendment, and if it is pressed to a vote, I intend to support it in order for the Government to have an opportunity to reconsider this issue.

My Lords, this is the second amendment on economic regulators tabled by the noble Baroness, Lady Wilcox, and, as she acknowledged, it bears a close resemblance to the amendment on economic regulators tabled by the noble Lord, Lord Norton of Louth, and my noble friend Lord Berkeley. Despite the refinement of the noble Baroness’s amendment, the Government remain of the opinion that an amendment on the independence of economic regulators is unnecessary. I set out the reasons for that in Committee, but I am happy to reiterate them for the benefit of noble Lords. We have reflected on that debate to see whether we can provide further assurance to noble Lords.

As the noble Baroness, Lady Wilcox, stated in Committee, and as this amendment seeks to install within the Bill,

“independence and jurisdiction … are essential if we are to ensure that private investors will have sufficient confidence in the regulatory system”.—[Official Report, 19/7/06; col. 1332.]

I agree. This Government are ensuring private investment confidence, and the UK is seen by private investors as one of the best places for companies to start, invest, grow and expand. In fact, according to the recent OECD report, Trends and Recent Developments in Foreign Direct Investment, the UK was the world’s largest recipient of inward foreign direct investment in 2005, attracting £91 billion of FDI, the largest inward direct investment ever recorded in the UK. Furthermore, the World Bank’s Doing Business 2007 report ranked the UK sixth, out of 175, in the world and first in the EU for ease of doing business. These statistics alone should provide sufficient confidence to private investors. However, the question this House must ask is: did the Regulatory Reform Act 2001, from which the economic regulators were not excluded, impinge on their independence and jurisdiction? The answer is no.

The House must also ask: did the 2001 Act deter private investment in the UK? Given the World Bank and OECD reports just mentioned, the answer would have to be no. The noble Lord, Lord Norton of Louth, suggested that that was because the powers had not yet produced that impact, but I thought the argument was that their existence created the problem. The existence of those powers in 2001 has clearly not created the problem.

Finally, one might then ask: will this Bill, once enacted, deter private investment, on the basis that investors will see the order-making powers as a potential power to disrupt the market? On the contrary, the order-making power gives confidence not just to the private but also the public and voluntary sectors that this Government are serious about reducing or removing unnecessary burdens on those sectors.

Clause 1(3) makes explicit that one of the Bill’s objectives is to remove obstacles to “efficiency, productivity or profitability”. Given that the Government recognise that investment is one of the main drivers to productivity, they would be extremely unlikely to make, under this Bill, any proposal that would jeopardise productivity through pursuing proposals that would undermine investor confidence. Parliament would also be likely to take a dim view of any such proposal.

This House should be asking itself: will this Bill, once enacted, provide an effective vehicle for cutting red tape? After two previous Acts I hope that this House can be confident in itself to reply in the affirmative.

I was surprised by some of the debate in Committee, which seemed to suggest that, using this Bill, Ministers could amend the regulatory structure on a whim—for example, by removing the chairman of an economic regulator—and as though Parliament had no say whatever in the process. That concern is clearly behind proposed subsection (4) of the amendment.

Noble Lords will of course be aware that this Bill has more stringent safeguards than the 2001 Act and includes an absolute and unrestricted right of veto for Parliament. Ministers cannot act on a whim. They will also be aware that every order is subject to a statutory consultation process, which requires the Minister to consult such organisations and persons that appear to be representative of interests substantially affected by the proposals, including any body, such as a regulator, whose functions would be affected by the proposed order. The consultation will provide the regulator and industry with an opportunity to make their views known. That point was pursued by the noble Lord, Lord Bradshaw. I hope that he is satisfied on that, and that it is absolutely clear.

The results of this consultation will influence both the Minister and Parliament in reaching a decision on the content of the draft order and the appropriate level of parliamentary scrutiny of it. The results will also influence whether Parliament wishes to approve the order, or whether it exercises its right to veto it.

Furthermore, the preconditions in the Bill and the statutory consultation provisions are not requirements for making primary legislation, the availability of which, in itself, does not lead to regulatory uncertainty or act as an obstacle to private investment. The procedural and substantive safeguards for any order should provide the reassurance that economic regulators and their respective markets need that changes to the regulatory structure cannot be made on a whim. In addition to that certainty, the Government have said throughout the parliamentary passage of this Bill that it is not our intention to erode the independence from the Government of those regulators set up by statute. I hope that that reassures the two noble Baronesses who have pursued that point.

This House will, of course, also be aware of the Government’s undertaking not to deliver highly controversial proposals by order. If a Minister decided to pursue an order in the face of vocal and evidence-based opposition from a regulator—or, indeed, from the regulated, whom we must not forget—this undertaking would also influence whether Parliament wished to approve the order or whether it chose to exercise its right to veto it. In addition to the protections provided in the Bill, I reiterate that businesses that are being regulated must have the right to raise concerns if economic regulators are carrying out their functions, for instance, overly bureaucratically. If there are sound reasons for suggesting any modification of their statutory functions for the purposes of removing or reducing burdens, or of modifying how those functions are carried out, it should be possible to address these by order, as it would be possible for any other regulator. I ask noble Lords why we should not seek to make that distinction. There should be a level playing field.

My Lords, the Minister is very good on the processes that he proposes and has talked a lot about whims, but the mere threat of a change to a regulator is enough to stop investment. This is true of Crossrail. I know that Crossrail is in a Bill, not an order, but simply putting it into a Bill—which is the same as putting it into an order, except there is less discussion about it—has already stopped investment. Change does not encourage investment. Does he have an answer to that?

My Lords, Parliament and Government can set policy on these things quite properly. There is always the option of legislation, whatever the consequences of that may be.

My Lords, the Minister went on about Parliament having a veto, but we all know what happens down the Corridor: three-line Whips are banged on and the measure goes through, irrespective of people’s moans or whinges. Up here, as we have just seen with the Motion in the name of the noble Lord, Lord Taverne, we do not divide on Orders in Council. The Minister’s undertaking sounds lovely in Whig political theories, and “come back, William III”, but the reality is different.

My Lords, I have more faith in the parliamentary process than the noble Earl clearly does. The provisions are there to be taken account of and to be put into effect.

It is worth my reinforcing the point that these orders can be of benefit to regulators. I referred in Committee to a consultation on a regulatory reform order to relax the consultation requirements imposed on the Financial Services Authority by the Financial Services and Markets Act 2000. This was referred to. I cite one example—we have not spent a lot of time digging out others—where this was of benefit to the regulator. If these benefits exist, why should we preclude them from being obtained through the use of orders under the legislation and the protections that we have outlined?

As I said in Committee, the economic regulators operate not in a stagnant environment but in an ever-changing and diverse one, and they need to be flexible and responsive to the challenges presented by the markets in which they operate. The House will be more than aware, in this age of climate change, of the growth of energy self-sufficiency and the attendant growth of the microgenerator industry. In a press release issued on 20 January 2006, Ofgem said:

“An increased interest in the connection of domestic-scale microgeneration equipment has raised a number of issues that may require a regulatory response, either now or as the penetration of microgeneration increases”.

Following a consultation on this issue, Ofgem says in its Next Steps document of October 2006 that it is:

“working to ensure that obstacles to development of microgeneration are identified and addressed, and that, where appropriate, we work with government to ensure that any support is well-designed and works with the competitive market framework.”

I am saying not that orders under the Bill are the solution for dealing with those issues, although they might be, but that this example demonstrates the evolving nature of regulation and that this House should not prevent the economic regulators or any other regulator proposing that Ministers use the order-making powers in Part 1 to their own benefit, or indeed to the benefit of those whom they regulate.

I should also like to add that discussions between Better Regulation Executive officials and the economic regulators have revealed that economic regulators are content not to have a total exclusion from the Bill and that they are exploring the opportunities that the Bill might present. Given the potential better regulation benefits for the economic regulators and those they regulate, the stringent safeguards in Part 1 and the fact that the 2001 Act has not led to an environment of uncertainty in the markets in which these regulators operate, I urge the noble Baroness, Lady Wilcox, to withdraw her amendment.

Finally, I shall pick up on one or two points raised during the debate. As regards the fact that the RRC and the DPRRC are not whipped, committees of this House and another place have a statutory right to veto. Whether that could be used to dispense with the services of the chair of any regulator was again raised. It is difficult to see how provisions in this Bill would fall within the vires of the order-making powers in Part 1, although the provision to sack a chairman would fall within the vires of the order-making powers of this Bill. There are currently statutory restrictions on the situation in which the relevant Secretary of State can remove the chair of a regulator. It is difficult to see that existing legislation results in a burden of the sort defined in the Bill. Even if it did, if the burden results only for the Secretary of State, Clause 1(4) rules out an order-making provision to remove or reduce that burden. We are faced with a situation where, in order to protect and ensure that we have independent regulators, we are precluding a benefit taking place because we are failing to recognise the safeguards that this legislation provides, which are substantial and significant.

My Lords, I am grateful to the Minister for giving way. I am still not following the argument. If the Government are prepared to give an undertaking not to undermine the independence of regulators, why are they unwilling to put that in writing in the Bill?

My Lords, it is on the record in these debates. The amendment seeks to do a number of things in addition to that. If the independence of the regulator means that in no circumstances by way of order could we look to address some of the regulatory burdens that may be imposed on the regulated, subject to all the protections in here, it is entirely reasonable that we would want potentially to raise those matters with regulators. Regulators would have the opportunity to be consulted, for their views to be known, for their views to be published, and to influence the process if they disagree. But what if they agree with the Government? Why does it undermine their independence if we allow through the order-making process what they and Government want and what is good for regulation to be denied them under this Bill? That does not seem to be a logical position.

We have reflected on safeguards. For the reasons that I have set out, the Government do not believe that this amendment is appropriate. Certainly, it is not our view. It is right to allow economic regulators to have access to a legislative route to implement worthwhile regulatory reform where appropriate. The Chancellor of the Duchy of Lancaster has been in correspondence with a number of the economic regulators on this issue. Members of this House should be aware that Postcomm, for instance, on 8 August 2006 in a letter to the Chancellor of the Duchy of Lancaster, asked the Minister to consider the application of the super-affirmative procedure in order to give the industry the maximum degree of reassurance in relation to the exercise of the powers in the Bill. Therefore, Members can see that Postcomm has made a suggestion that we believe could deliver a balance between ensuring that the order-making powers can be used for appropriate purposes while at the same time providing, as Postcomm says, the maximum degree of reassurance to industry.

Members of this House will acknowledge that the Government have listened carefully to this House and the other place throughout the passage of this Bill. We continue to listen and should Members indicate that they think an alternative approach to this Opposition amendment is appropriate, the Government will consider this further and return with an appropriate amendment at Third Reading. We would of course consult with Opposition parties on the drawing up of the amendment.

My Lords, most noble Lords who have spoken today have been in on the Bill from the beginning. I am sorry that the noble Baronesses, Lady Howarth of Breckland and Lady Young of Old Scone, have not been able to join us until this late in the day. I know that the noble Baroness, Lady Young, has been very ill following her riding accident. On behalf of these Benches, perhaps I may say that we are delighted to see her back in her place.

I am lucky indeed to have been supported by my noble friend Lord Norton, the noble and learned Lord, Lord Lloyd of Berwick, and the noble Lord, Lord Goodhart, for the Liberal Democrats, which is marvellous—as well as the support of the expert on the railways opposite. It was absolutely marvellous to hear him speak.

Noble Lords have been patient and there is no point in reiterating all the arguments. I do not share the Minister’s faith that future Ministers will consistently adhere to his undertaking not to pursue controversial orders and not to undermine the independence of the economic regulators, welcome as those undertakings are. However, I am afraid that the shadow of Railtrack still looms over the City. I can only echo the words of my noble friend: protecting the independence of the regulator and to be seen to be doing so is the most important thing we can do here today. I therefore wish to test the opinion of the House.

Leave out Clause 4.

The noble Lord said: My Lords, Clause 4 has aroused some controversy. Whereas the rest of the Bill envisages amendments, repeals and so on, this clause allows subordinate legislation to be made by this order. The House of Commons First Special Report 2004-05 entitled Operation of the Regulatory Reform Act 2001 said:

“The RRC has suggested that the introduction of a power to sub-delegate will be a constitutionally significant extension of the RRO process. They consider that any proposal to introduce a power to sub-delegate will require very careful consideration by the House and would require significant safeguards for the exercise of that power”.

People think it is entirely right that we should have a good hard look at this. There were debates in Committee, but I do not feel that we have resolved the problem.

The function of legislating belongs primarily to Parliament. This clause gives the power to sub-delegate so that other bodies can use the provisions of the Bill to legislate. I wonder whether that is correct. Subordinate legislation usually operates under a specific Act of Parliament; Parliament sub-delegates for specific subordinate legislation, and that subordinate legislation is within the framework of a specific Act, for a specific task, within a specific timeframe. If that specific task is not carried out, the subordinate legislation would be ultra vires and therefore void.

However, the danger in this enabling legislation is that such a general power is being given. Let me use the analogy of a key: if, in the ordinary way, you give the Minister a key to a building and then another key to a specific room inside—that is, the subordinate legislation—you are being very specific about what he has access to. We are being asked under Clause 4 to give Ministers a master key which can be used, as it were, for any room in any building.

I understand that the noble Lord, Lord Goodhart, has raised anxieties about this clause with the Minister. I rely for that on the letter which the Minister wrote to all of us on 11 October. Under a passage headed “Sub-delegation”, he mentioned that the noble Lord had brought to his attention an issue relating to a clause,

“which sets out the conditions that must apply where Ministers, or other appropriate persons, are exercising legislative functions”.

I suspect that many noble Lords present have received copies of the letter. The Minister continued:

“I would like to clarify that it is only in the case that a Minister is conferred functions of legislating by order that this condition applies—a provision set out in subsection (3)”.

That was added at the Committee stage. The Minister went on to say:

“The provision reflects recognition that it is not always appropriate for other persons or bodies to exercise functions of legislating by making statutory instruments—for example, where a local authority has a power to make local byelaws. However, the procedural requirements in Clause 5 which apply to Ministers should not be taken to mean that no procedural requirements will be attached to a power to legislate conferred on someone other than a Minister. An order which confers a power to legislate will need to set out the procedural requirements for the exercise of that power, which will depend on what is appropriate in the light of the person who is to exercise the power and the nature of the legislation which will be made”.

That is all very well, but there is absolutely no indication of what the safeguards will be. The House needs to be told what the additional safeguards are to which the Minister referred in his letter, and which will provide the protection that we would want to see. The clause gives the power for subordinate legislation to legislate. That should not be as, by and large, it appears in this clause. I think that the Minister has recognised that by saying that there will be limits, but he has not set out what they will be. Different limits may be appropriate to different conditions and circumstances. I should be grateful if the Minister could in his reply give us a clearer indication of what the Government have in mind for the conditions they will attach to the power to legislate. I beg to move.

My Lords, the amendment would remove Clause 4. It may be intended to have the effect of preventing orders made under Part 1 conferring powers of legislating. However, since Clause 4 places restrictions on that ability, the amendment would leave the ability to confer the function of legislating untouched, since it would merely remove the restrictions on it.

I do not want to repeat arguments which I have set out previously when discussing the provision in Clause 4, but I will reiterate the key points that need to be considered when looking at the merits of retaining an ability to confer powers to legislate by order and of retaining the restriction on the power currently provided for in the Bill.

The ability to confer the function of legislating by order is essential if we are to ensure that it is possible for orders to deliver large-scale reforms to entire regimes. As with Bills, it is not always possible, or appropriate, for all the detail of a statutory regime to be set out in primary legislation. Powers to make secondary legislation are important also because some aspects of an order might need subsequent amending or updating. That is already possible under the 2001 Act, whereby provisions in orders can be designated as subordinate and be easily amended in future.

I am sure that noble Lords will be aware that the Delegated Powers and Regulatory Reform Committee has commented that including such a power in the Bill for orders to be able to confer the function of legislating is not inappropriate. The committee also recommended that the power to confer legislative powers by order, while not inappropriate, should be subject to further restrictions.

The Government have responded to these concerns. We have strengthened the restrictions on the power through the amendments we made to Clause 4 in Committee. The power to confer legislative functions by order is limited in important ways by Clause 4. The Bill restricts the persons or bodies eligible for such powers to three categories. The first is Ministers, the category of persons most likely to be given powers to legislate as part of future orders. The second category is persons or bodies who have statutory functions conferred on them. This will ensure that powers to legislate can be given only to persons or bodies already recognised by Parliament as suitable to have functions conferred on them.

The third category is a body, or the holder of an office, created by the order itself. This will ensure that the Bill can be an effective vehicle for delivering mergers of regulators, such as those recommended through the Hampton review, when, for instance, a new body is being created by order to take on functions of an existing body and the merger is for the purpose of removing or reducing burdens upon the regulated. Without the power, it would be necessary to deliver such valuable reforms in more than one order, using one to set up the appropriate new body and another to confer functions upon it, rather than this all being done by the same order. This is something that I am sure that noble Lords would agree would be unnecessarily cumbersome and bureaucratic.

I should also make it clear that there are of course other important safeguards in the Bill, including the statutory veto, to protect against the inappropriate use of this power. Clause 4 also makes explicit that it will not be possible further to delegate powers conferred by order to others. Ultimately, however, if Parliament is unhappy with the proposals to confer functions, the order can be voted against. All orders must pass through the prescribed parliamentary procedure and, if either House objects, the order cannot be made.

The ability for orders to confer powers to legislate, along with the important restrictions on that ability set out in Clause 4, are a key part of the order-making powers in the Bill. For those reasons, I cannot support the amendment and therefore ask that it be withdrawn.

The noble Lord asked, too, what safeguards the order would contain. I have set out some of them, and am happy to write giving a more in-depth explanation, but it is worth saying that the order conferring the power to legislate would in any event have to specify on whom the power was conferred, the type of legislation they could make and the procedure to which they would be subject—namely, the negative or affirmative procedure. I am happy to continue a dialogue outside this Chamber on these matters if there are details that trouble him and other noble Lords.

My Lords, the Minister reminded us that if either House uses the veto powers, that is the end of the matter and the thing has to be dealt with by primary legislation. He also made it clear that the powers to sub-delegate can be given only to bodies for which Parliament has already approved power to legislate in these circumstances. That goes some way to meet my concerns, but it would be helpful if the Minister could write a letter setting out what he touched on very briefly at the end of his speech. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 5 [Taxation]:

Page 4, line 26, leave out from “impose” to end of line 27 and insert “, abolish or vary any tax”

The noble Lord said: My Lords, I shall also speak to Amendment No. 21. Clause 5 restricts the powers in Clauses 1 and 2, preventing an order imposing or increasing taxation. Concerns were raised in Committee that, unamended, the Bill would leave it open for a Minister by order to reduce or remove taxation. That is not the intention. The first of these amendments will make it clear that an order under Part 1 cannot be used to impose, abolish or vary any tax.

The second amendment concerns potential tax liabilities that could arise from the merger of regulators. When transferring regulatory functions from one regulator to another it may be necessary also to make provision in an order to transfer assets and liabilities from the old to the new regulator. In certain circumstances, without further provision, a transfer could result in inappropriate tax consequences for the transferor or transferee body that would arise solely because of the transfer. This amendment addresses those unwanted consequences. It allows the Treasury to make tax provision by regulations in relation to a transfer of property, rights and liabilities by an order under Part 1. This power will allow the Treasury to make appropriate tax provision at the appropriate time to ensure that a transfer does not give rise to a tax charge or confer a tax advantage on either party. It is unlikely that these powers will be needed to be used often, and then only in the unusual circumstances that a merger is being pursued by order that involves the transfer of property, rights and liability. I beg to move.

On Question, amendment agreed to.

Page 4, line 28, leave out subsection (2) and insert-

“(2) The Treasury may by regulations make provision for varying the way in which a relevant tax has effect in relation to-

(a) any property, rights or liabilities transferred by or under an order under this Part; or (b) anything done for the purposes of, or in relation to, the transfer of any property, rights or liabilities by or under an order under this Part. (3) The provision which may be made under subsection (2)(a) includes in particular provision for-

(a) a tax provision not to apply, or to apply with modifications, in relation to any property, rights or liabilities transferred; (b) any property, rights or liabilities transferred to be treated in a specified way for the purposes of a tax provision; (c) the Minister of the Crown making the order to be required or permitted, with the consent of the Treasury, to determine, or specify the method for determining, anything which needs to be determined for the purposes of any tax provision so far as relating to any property, rights or liabilities transferred. (4) The provision which may be made under subsection (2)(b) includes in particular provision for-

(a) a tax provision not to apply, or to apply with modifications, in relation to anything done for the purposes of or in relation to the transfer; (b) anything done for the purposes of or in relation to the transfer to have or not have a specified consequence or be treated in a specified way; (c) the Minister of the Crown making the order to be required or permitted, with the consent of the Treasury, to determine, or specify the method for determining, anything which needs to be determined for the purposes of any tax provision so far as relating to anything done for the purposes of or in relation to the transfer. (5) Regulations under subsection (2) are to be made by statutory instrument.

(6) A statutory instrument containing regulations under subsection (2) is subject to annulment in pursuance of a resolution of the House of Commons.

(7) In this section-

“relevant tax” means income tax, corporation tax, capital gains tax, stamp duty or stamp duty reserve tax; “tax provision” means a provision of an enactment about a relevant tax.”

On Question, amendment agreed to.

Clause 6 [Criminal penalties]:

Page 4, line 30, leave out “that is punishable, or” and insert “and may not”

The noble Lord said: My Lords, Amendments Nos. 23 and 24 are consequential. We discussed in Committee the extent to which order-making powers could be used to impose or repeal penalties involving fines and imprisonment. I expressed the view that we had to be circumspect in providing that any body other than Parliament itself could prescribe specified offences carrying terms of imprisonment. I tabled amendments designed to limit the scope for imposing or repealing penalties carrying terms of imprisonment.

I listened carefully to what the Minister had to say in response. My amendment takes account of what he said. I have decided not to pursue amendments affecting the repeal or modification of existing offences. I can see that there may be a case for retaining those powers in order to remove burdens, but I do not consider that approach the best one. I would have preferred the proposal advanced by my noble friend Lord Goschen; namely, that of an annual deregulation Bill, a medium through which offences could, with Parliament’s assent, be removed or created. However, if we are to have this Bill, I am prepared to concede the power to modify or remove existing offences.

I think, though, that there remains a case for requiring primary legislation for new offences. My amendment provides that no new offences may be created under Part 1, and that the penalty for existing offences may not be increased so that they are punishable on indictment for a term exceeding two years, or on summary conviction imprisonment for a term exceeding the normal maximum term or a fine exceeding level 5 on the standard scale.

The case for the amendment is straightforward. New offences, especially those carrying terms of imprisonment, should be introduced through primary legislation and subject to the full rigours of legislative scrutiny. There is greater scope for probing and considering amendments than is the case with the order-making power. Parliament needs to be at its most rigorous and operating in the full glare of public attention when it introduces new offences that may result in individuals being sent to prison.

What, then, is the argument for allowing new offences to be created by secondary legislation? In Committee, the Minister argued that a new offence would be subject to the safeguard that Ministers would need to ensure that the preconditions in Clause 3 were met, and that the order could be vetoed by the relevant parliamentary committee. He also pointed out that the provision was carried over from the 2001 Act, and that the provision had not been abused.

Those arguments are not sufficient to overcome the point of principle in question. The fact that a provision is carried over from the 2001 Act is not, to my mind, a commendation, as I variously argued on other points earlier today. I was as critical of that measure as I am of this one. The Minister’s own words could be used against him. To claim that the provision has not been abused is to concede that it could be.

In essence, the choice is between a point of principle and one of convenience. We may be willing to concede that burdens including criminal sanctions may be removed by secondary legislation and that existing sanctions may be modified, but I think we should be extremely wary of permitting, or continuing to permit, the creation of new sanctions by secondary legislation. I beg to move.

My Lords, Amendment No. 22 and its consequential Amendments Nos. 23 and 24 seek, as the noble Lord described, to prevent any order creating any new criminal offence.

Taken in isolation, I could understand that the powers to create new offences might raise some concerns. However, the creation of a new criminal offence by order could not be done arbitrarily. This ability is entirely limited by the vires of the order-making powers so that criminal offences could only be created by order for the purposes of either Clause 1 or Clause 2; that is, they would have to be for the purpose of removing or reducing a burden for any person or securing that regulatory functions are exercised in accordance with the principles of better regulation. In an order made under Clause 1, the creation of a new offence would have to be for the purpose of removing or reducing a burden defined, for example, as a financial cost, an administrative inconvenience, an obstacle to productivity, profitability or efficiency or, most importantly, perhaps, in this context, an existing sanction.

Furthermore, the provisions in Clause 1 provide a power to remove or reduce burdens resulting from existing legislation and could not be used to create entirely new regimes. They could, however, be used to replace one statutory regime with another that is less burdensome for any person. In such cases, there might be an existing criminal offence which is no longer considered to be well targeted. This may be, for example, because it applies to too wide a category of situations or persons. The order might then contain provision to replace the existing criminal offence with a new narrow one which was felt to be better focused, where this was for the purpose of reducing or removing the burden of the existing wider criminal offence.

One of the key problems with the 2001 Act is that it contained a number of arbitrary technical restrictions. This prevented proposals being implemented in perhaps the most logical way. In some cases, the restrictions formed such a barrier that it did not make sense to deliver the proposal by order, delaying or preventing, in our view, the delivery of better regulation. We need to avoid creating new technical restrictions, particularly regarding sanctions, which form a major part of ensuring compliance and hence the success of a regulatory regime.

The powers to create new criminal offences provided for in the Bill are not unprecedented. As noted in Committee, this power has parallels in the European Communities Act and as the noble Lord, Lord Norton of Louth, has observed, was carried over from the 2001 Act. I know he does not accept the point, but that is the case.

Clause 6 also specifies the limits on the level of sanctions that may be imposed. These are less than those already contained in a number of regulatory regimes, so the maximum levels in Clause 6 set meaningful limitations to this power. Furthermore, the Government have already made a commitment not to deliver highly controversial proposals by order. Proposals which create inappropriate new criminal offences will clearly come into that category, so that is the limiting effect of our commitment.

In addition, the pre-conditions in Clause 3 prevent a Minister making an order which he considers, among other things, to remove necessary protections or to prevent anyone continuing to exercise any right or freedom which they might reasonably expect to retain. This opinion would have to take account of any representations received during the statutory public consultation period and would be scrutinised by parliamentary committees which have the power, as we have explained on many occasions, to veto any proposal they consider unsuitable for delivery by order.

I understand where the noble Lord is coming from. I know that he will not find it easy to accept the constraints which we argue we have put in place because he thinks we should do this through primary legislation, but I would invite him to consider that we have provided real constraints and a narrowing. I hope he will recognise that this is a practical measure and will withdraw his amendment.

My Lords, I understand where the Minister is coming from. I was not implying that there was unrestricted power to introduce through an order a term of imprisonment for anything other than what is prescribed in the Bill. He is right about what the measure could be introduced for. It is narrowly limited by the Bill. I do not question that.

As the Minister recognises, there probably will not be a great meeting of minds on this. I still have two problems with the measure. I would not object to a change in wording that made clear that where an offence was introduced it was to replace one in order to reduce a burden. My concern is with its being introduced completely freestanding as a new offence.

I have two sticking points. One is simply the point of principle. I refer to the point I made about principle versus convenience. The argument for the Bill is one of convenience. On the point of principle, even if narrow limitations are applied, as the Minister said, if the measure imposes a term of imprisonment that is a new offence. Parliament should have the opportunity to probe that measure and amend it through primary legislation. I believe that the Minister referred to it as a technical restriction. However, I consider that it is a very important point of principle.

The other point is more general and has been an underlying theme of our debates today. The Minister said that the Government had given an assurance that contentious measures would not be introduced. As we keep pointing out, while we accept his word, he cannot necessarily commit his successors. Given that I have those problems with the measure, I shall want to reflect further on it. I see the point about the possibility of replacing an offence. I shall want to reflect further on that, but it is not a point that I wish to press this afternoon. I hear what the Minister says, but, as he says, we are coming at the matter from slightly different perspectives. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 23 and 24 not moved.]

Clause 8 [Excepted enactments]:

[Amendments Nos. 25 to 27 not moved.]

Clause 12 [Procedure: introductory]:

Page 6, line 18, at end insert-

“( ) An order under this Part which creates, amends or repeals any primary legislation must be made in accordance with the affirmative resolution procedure or the super-affirmative resolution procedure.

( ) In this section “primary legislation” has the same meaning as in the Human Rights Act 1998 (c. 42).”

The noble Lord said: My Lords, many, though not all, of the orders that will be made under the Bill will involve changes to or the repeal of primary legislation. I believe that the basic principle here is that primary legislation should not be altered by the negative resolution procedure, as that gives virtually no opportunity for either House of Parliament to give proper consideration to the matter.

However, I recognise that there are exceptions to what I have called the basic principle. I am aware that the Delegated Powers and Regulatory Reform Committee sometimes accepts clauses in a Bill that provide for transitional or consequential amendments to be made by the negative resolution procedure. There may be cases where a Bill contains a power to modify provisions in that Bill to a limited extent. In such cases, the negative resolution procedure is appropriate, because the modification is of no significance. But the negative resolution procedure is used appropriately only where the powers to be made by the order using that procedure are very limited and where the ability to make those powers is closely circumscribed.

But with those exceptions I believe that it is right that primary legislation should be altered by secondary legislation only through a process that guarantees that the order is considered by both Houses of Parliament. I recognise that the procedure for dealing with affirmative resolution is unsatisfactory, particularly in the other place, but it is at least better than the negative resolution procedure.

Given that the Bill provides wide powers to alter primary legislation and there is no limitation to the alterations for which the negative resolution procedure would be appropriate, apart from the general restrictions on what can be achieved by the Bill as a whole, we should write into the Bill a requirement that any alteration of primary legislation should be by affirmative resolution or by the super-affirmative procedure. I beg to move.

My Lords, I rise to speak to my Amendment No. 30 in this group. Its purpose is to shift the onus for recommending the procedure to be adopted for considering an order from the Government to Parliament. I pursued this issue in Committee, but I have changed the wording of my amendment to take into account a crucial drafting point made by the noble Lord, Lord Goodhart.

The case for my amendment is compelling and twofold. The first argument is a matter of general principle. Parliament should have a far greater say over the conduct of business. As I pointed out in Committee, the House of Commons is remarkable among legislative Chambers in the democratic world for the extent to which the business of the House is determined by the Executive. It is common for other legislative Chambers to have business committees that determine the allocation of time. That practice does not prevent a Government from getting their business; the evidence on that is clear. It is not a blocking procedure, but one that ensures that time is allocated as is deemed to be appropriate by the House, not by the Government. That is wholly appropriate; as far as possible, Parliament should be the master of its own procedure.

My second point is specific to this measure. As I argued in Committee, there is a danger of Parliament missing the significance of an order. Under the Bill as drafted, Parliament assumes a reactive role, in which the onus is on the Minister, and there is a danger that a committee may not pick up on the significance of an order that is recommended for the negative resolution procedure but merits more stringent consideration. A great deal rests on the vigilance of the committees and it is not clear how busy they will be.

My amendment would place the responsibility on both Houses to check an order as soon as it is laid by a Minister and to decide whether it merits being moved from the super-affirmative to the affirmative or negative resolution procedure. The super-affirmative procedure would be the default. That would ensure that no important order slips under the net of parliamentary scrutiny and it would place responsibility for the procedure where it should be—with Parliament, not the Executive.

Because my amendment was grouped with others in Committee, the Minister dealt with it only briefly. He covered it in five sentences, only three of which were substantive. He appeared to consider that losing the reference to a committee in Clause 15(6)(b) removed an important safeguard and that the clause, as drafted, provided the right level of detail to ensure legal certainty. The loss of reference to a committee is not crucial to ensuring parliamentary safeguards. Each House is likely to establish a committee, but that is a matter for each House.

The difference between the wording of the amendment that I tabled in Committee and this amendment is crucial in that it requires the agreement of both Houses to decide that the super-affirmative procedure shall not be employed. It is thus not possible for a Government secure in their majority in the House of Commons to utilise that majority to avoid effective scrutiny of an order laid under the provisions of this Bill. This House, under this amendment, would thus have an important role to play.

The other point raised by the Minister was an expression of view, but not one that undermines the case for my amendment. There will be legal certainty under the procedure prescribed by this amendment, just as there is under the one proposed by the Government. The Minister appeared to mix a claim about legal certainty with one about whether the procedure would be useable. This amendment produces a procedure that will be useable, but in the context of Parliament determining which procedure is appropriate.

I have spent the past quarter-century arguing the case for strengthening Parliament in calling the Government to account and in ensuring proper scrutiny of legislative proposals. I offer this amendment as a small step in the right direction.

My Lords, I have Amendments Nos. 31 and 32 in this group. We have listened to two powerful speeches that argued for different amendments to strengthen the oversight of subordinate legislation by Parliament. My wish in relation to this measure is that we should not use the negative procedure at all. The scrutiny period is only 40 days. The review that was published quoted the RRC report on the operation of the 2001 Act and concluded that,

“we have yet to see any hard evidence that a period of less than 60 days for the initial scrutiny period would be appropriate”.

I shall not argue that we should have only the super-affirmative procedure but, in view of the nature of the orders being made under this Act and the fact that we are, as it were, delegating blind, because one does not know what is going to come, it seems to me that an affirmative procedure throughout would be appropriate. I recognise that the ordinary affirmative procedure gives only 40 days; nevertheless, it requires an affirmative vote in both Houses before the order can be made. On the other hand, the negative procedure—over the years one has recognised, as others have said, that this is a pretty feeble form of parliamentary scrutiny—requires that there should be a Prayer and that time should be found to debate the Prayer and so on. From experience, one knows just how difficult it is to persuade the business managers to find time for a Prayer that they do not like. For that reason, I argue that the procedure should only be affirmative. My amendments would take out the references to the negative procedure and would remove Clause 16, which sets out the conditions for the negative procedure.

We have had three options, to which the Minister will no doubt wish to reply. The noble Lord, Lord Goodhart, said that if you are amending primary legislation, it should certainly always be affirmative. My noble friend Lord Norton of Louth made a very powerful case for strengthening parliamentary procedure and, in particular, for giving power over the decision on business. I would have no negative procedure at all. I suppose it is a case of divide and rule, but we do not like what is in the Bill.

My Lords, I shall speak to Amendment No. 28. I am in the same quandary over this issue: I do not think that the Bill is right but I am not sure what “right” would look like. Amendment No. 28 has merits and demerits. Its merits are that it could ensure—I keep hammering on about this—that changes in the roles, powers and existence of regulators that have been established by primary legislation would receive a higher degree of scrutiny.

Its demerits are that, alas, some primary legislation gets stuffed with small and rather less important detail, which needs to be changed. I am as guilty of that as many other Members of this House, as I am sure your Lordships are painfully aware. I would not want to see a change in the Bill that prevented some of the minor changes established by primary legislation from getting through by the fastest possible means. We must not lose sight of the purpose of the Bill: it is to improve regulation and to ensure that burdens are not disproportionate and that changes to legislation can happen quickly.

With regard to Amendment No. 28, I do not think that the primary nature of the legislation is the issue. Much primary legislation does not concern matters of high importance but deals in the detail to which I referred. It is the degree of controversy or agreement that should be the touchstone or the fundamental nature of the change. Again, I go back to, for example, changes in the role, powers or existence of a regulator established by statute.

During the debate on Amendment No. 18, I was encouraged when the Minister hinted that there might be some movement by the Government to bring forward an amendment at Third Reading to specify in the Bill when the affirmative or super-affirmative procedure might be required. I hope that I did not misunderstand him and that we can press him to give us more information today about his hint before this matter is put to the test—if, indeed, it is.

My Lords, I am not persuaded by the idea put forward by the noble Lord, Lord Norton of Louth, that somehow committees of the House can be very busy and that both Houses should consider such matters on the Floor. My experience is that committees scrutinise such matters more thoroughly over more time. When the whole House discusses such issues, the debates are either at a very obscure time or they tend to be rushed. Eventually the orders made under the Bill will not be major orders. I know that the Opposition pretend that this Bill will change the constitution, but it is just about red tape. If we want to expedite the cutting of red tape, we should have a committee that looks at the matter carefully and quickly, and reaches a decision. Leaving the matter to both Houses will take much more time and could be, dare I say it, much more sloppy.

My Lords, this has been a valuable mini-debate on the appropriate level of scrutiny for a draft order. In his brief contribution, the noble Lord, Lord Desai, put his finger on it. It is about having something that is appropriate to the scale and level of the problem.

The noble Lord, Lord Jenkin, said that there was a commonality of view but that there were different solutions on offer as amendments, which I shall work through. The first amendment—Amendment No. 28—would prevent any order made under Part 1 from being delivered by the negative resolution procedure, if it amends or repeals existing primary legislation. That is an important caveat. As I said in Committee, the amendment would effectively remove the option of negative resolution for all orders, as most, if not all, made under Clause 1, will include provisions to amend or repeal primary legislation. For this reason, in addressing Amendment No. 28, I also need to consider Amendments Nos. 31 and 32, which would remove Clause 16—the negative resolution procedure—from the Bill altogether.

During our previous debate on this issue, I was delighted when the noble Lord, Lord Goodhart, in speaking in support of an amendment that is not dissimilar to Amendment No. 28, agreed—I think that he may have repeated it this afternoon—that there may be draft orders that are suitable for delivery by the negative resolution procedure. That is how I understood the noble Lord to address the issue then. However, the Government believe that for all orders it is appropriate that the level of scrutiny is determined on a case-by-case basis, depending on the content and impact of the proposals in a draft order. Where orders are evidently straightforward, we should—as the noble Lord, Lord Desai, picked up—maintain the option of delivering them by what is, after all, a proportionate procedure.

Furthermore, Clause 15 ensures that the final decision on the appropriate procedure for an order is left to the House. In a sense, we satisfy a point raised by the noble Lord, Lord Norton of Louth. Parliament should be the master of the process. It is right that Parliament will determine whether, and on what basis, an order should be subject to the negative, affirmative or super-affirmative procedure; it may decide, in any case, that there will be a more onerous level of scrutiny. It is for these reasons that I urge noble Lords not to press their amendments.

The second amendment in this group—Amendment No. 30—removes the provisions set out in Clause 15 for determining the level of scrutiny for a draft order. It replaces these with the condition that all orders are to be subject to the super-affirmative resolution procedure unless both Houses of Parliament require a less onerous procedure. From this and earlier debates on a similar amendment tabled by the noble Lord, I understand that the amendment seeks to ensure that Parliament has a proactive role in determining the level of scrutiny and does not miss the significance of a particular order.

As I have just stated, Clause 15 already provides that either House may require that an order proceeds via the more onerous super-affirmative procedure, and the final decision on the level of scrutiny is left to the House to determine. I also should reiterate that I fail to see the value in preventing a Minister from even recommending a level of scrutiny. A Minister’s opinion will not be made in isolation, but will take into account any representations received during the statutory public consultation period. The opinion is there to add some benefit, advice and guidance from the ministerial perspective, but it does not have to be the final determinant.

I also question the value of removing the reference to the parliamentary committees’ ability to recommend that a different scrutiny procedure should apply. These committees evidently have considerable expertise in assessing orders under the 2001 Act, and would be well placed to recognise proposals that should be subject to more onerous procedures. Why take that away? Indeed, the Delegated Powers and Regulatory Reform Committee, responsible for scrutinising orders laid under the 2001 Act, stated that it agreed,

“that 30 days is sufficient for either House or a Committee to consider the proposed procedure and if necessary ‘upgrade’ it”.

Furthermore, it is not clear from this amendment how the process of determining the procedure would work in practice—specifically, how the noble Lord envisages that an agreement would be reached between the two Houses, and how this process would affect the time periods provided for scrutinising the proposals. I am not sure how any conflict would be resolved in that situation.

The noble Lord, Lord Norton, asked whether Parliament might miss the significance of an order. Well, committees have 30 days in which to recommend a more onerous process. During that time, they will be scrutinising the content of the order, so it seems unlikely—very unusual—that they would miss the significance of an order during that timeframe, not least because they have great levels of expertise, as we have discovered over the years.

The noble Baroness, Lady Young of Old Scone, probed the offer that we made earlier in the debate. We will give further consideration to that, and I am grateful to her for reminding us not to put it to one side.

My Lords, this debate has seen three alternatives proposed, each of which has merits and is arguably an improvement on the present situation in the Bill. Having said that, I recognise that Clause 15 allows either House to require that anything introduced under either the negative or the affirmative resolution procedure can be upgraded as a result of the decision of either House of Parliament. That being so, the difference between what has been proposed in this group of amendments and the Bill as it now stands is fairly narrow. Under those circumstances, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 14 [Draft order and explanatory document laid before Parliament]:

Page 7, line 17, at end insert “, and

( ) a statement that in his view the provisions of the order are compatible with the Convention rights (as defined in the Human Rights Act 1998 (c. 42)).”

The noble Lord said: My Lords, this is the first of two amendments in my name involving the Human Rights Act 1998.

Amendment No. 29 requires a statement to be made that the provisions of a draft order put before either House are compatible with convention rights. That requirement is based on Section 19 of the Human Rights Act. It does not, of course, include the second limb of Section 19, which enables a Minister to make a statement that the Bill is incompatible with the convention rights but the Government wish to proceed with it. I think that has happened only once, when an amendment was made to a Bill in your Lordships’ House against the wishes of the Government, who took the view that it was inconsistent with the Human Rights Act, therefore they had to make a statement of incompatibility when the Bill moved to the Commons.

It is plainly inappropriate that the procedure under the Bill should be used if the Minister is unable to give a statement of compatibility. Any order made under those circumstances would be seriously controversial, and it would therefore be wrong to introduce it. A Minister should be able to give an order a declaration of compatibility before it can be introduced.

In practice, a statement of compatibility does not apply to primary legislation only; it has also become a convention that one is made in the case of statutory instruments subject to the affirmative resolution procedure, as a result of a decision pronounced some years ago by the late Lord Williams of Mostyn. It is plainly appropriate to require a statement of compatibility for draft orders made under the Bill. This simple amendment would involve no difficulties in practice but it would at least concentrate the Government’s mind on the human rights implications of a draft order before they introduce it. I beg to move.

My Lords, I support the amendment moved by the noble Lord, Lord Goodhart, to which I have added my name. I moved a similar amendment in Committee, but the noble Lord’s is better drafted. As we are on Report, I did not intervene in response to the noble Lord, Lord Desai, but, in passing, I note that he confused the House and the Chamber.

My Lords, I support this amendment for the reasons given by the noble Lord, Lord Goodhart, and have nothing further to add.

My Lords, I always admire the telegraphic style of the noble Lord, Lord Kingsland. It is most helpful on this occasion.

Before I turn to this specific amendment, it may assist the House if I first address some confusion about the interpretation of the Human Rights Act that arose in Committee. As your Lordships will be aware, the Human Rights Act gives effect in our law to rights drawn from the European Convention on Human Rights; those rights are known as the convention rights. Section 6(1) of the Act makes it unlawful for a public authority to act in a way which is incompatible with the convention rights. A Minister of the Crown is a public authority for those purposes and is therefore bound to act compatibly with the convention rights when discharging his or her duties. Parliament is, however, expressly excluded from being a public authority by virtue of Section 6(3).

When a Minister seeks to make secondary legislation, whether under the Bill or otherwise, he is therefore legally required to do so compatibly with the convention rights because secondary legislation is made by Ministers and scrutinised by Parliament, rather than being made by Parliament itself. If secondary legislation is not compatible with the convention rights, the court may strike it down, as it would if the Minister had acted ultra vires in any other way in making it. Your Lordships will, of course, know that the Human Rights Act does not allow a court to strike down primary legislation; instead, a court may draw incompatible primary legislation to Parliament’s attention by means of a declaration of incompatibility.

The noble Lord, Lord Goodhart, drew attention in Committee to a provision in Section 21 of the Human Rights Act under which secondary legislation that amends primary legislation is treated as primary legislation for the purposes of the Act. However, if one looks to see where the distinction between primary legislation and secondary legislation arises in the Act, one finds that it has a bearing only on the remedies available to the court should it find the secondary legislation incompatible. In particular, the distinction does not arise in Section 6 and therefore does not change the position that a Minister who makes incompatible secondary legislation is acting unlawfully.

I know that we will come later to the noble Lord’s other amendment, which would make it possible for a court to strike down all secondary legislation made under this Bill, whether or not it amends primary legislation. However, even without that amendment, the position remains under the Human Rights Act that it is not lawful for a Minister to make secondary legislation that is incompatible with the convention rights.

This amendment would require that all secondary legislation made under this Bill would have to be accompanied by a statement of compatibility, similar to the Section 19 statement that appears on the front of every Government Bill presented to the House. In nearly every case—including this Bill—this is a statement of compatibility under Section 19(1)(a) of the Human Rights Act. It certifies that, in the opinion of the Minister in charge of the Bill, its provisions are compatible with the convention rights.

It is possible for a Minister to make an alternative statement under Section 19(1)(b) of the Human Rights Act. Such a statement indicates that, although the Minister cannot make a statement of compatibility, the Government nevertheless wish the House to proceed with the Bill.

The Section 19 statement reflects an important distinction under the Human Rights Act: that Parliament is still permitted to act incompatibly with the convention rights. Noble Lords will note that Parliament is expressly excluded from being a public authority in section 6(3) of the Human Rights Act.

It is, however, proper that if the Government are going to ask Parliament to legislate incompatibly, we should be absolutely clear when doing so, which is the point of the Section 19 statement. The option to act incompatibly does not arise for secondary legislation, as I have explained. Therefore, the statement of compatibility with which the Government accompany certain secondary legislation as a matter of convention when it is being scrutinised by Parliament serves only to confirm that the Minister considers the instrument to be compatible. It would, therefore, already be unlawful for the Minister to make secondary legislation that is incompatible.

If a Minister were to indicate that proposed secondary legislation is not compatible with the convention rights, he would effectively be admitting that he was intending to act unlawfully in making it. It is for that reason that I must oppose the noble Lord’s amendment. The Government would not, and could not, lawfully make orders under this Bill or any other Act that are incompatible. However, providing in statute for a statement similar to Section 19 could wrongly give the impression that the genuine alternative of acting incompatibly is open to the Minister.

I hope that I have explained clearly why the Government cannot support the amendment. They will continue as a matter of convention to make such statements, but we would oppose any move to require this in statute for the reasons I have given. I hope that the noble Lord, having followed that, will withdraw his amendment.

My Lords, I am a little puzzled by the explanation given by the Minister. He started by saying that it would be unlawful for any Minister to introduce secondary legislation that is incompatible with the Human Rights Act. As I understood it, he then went on to suggest that, notwithstanding that, it would be possible to make, presumably by using an order, alterations to primary legislation, which by virtue of Section 21(1) of the Human Rights Act would not themselves be unlawful but would have to be dealt with as a matter of incompatibility. Those statements do not seem to fit together very clearly.

Presumably, before the order is submitted to Parliament, when it is in draft, it would be possible to go to the court to say that the Minister had acted improperly because he is introducing legislation which we believe is incompatible with the Human Rights Act, and perhaps to get the court to make an order to stop him proceeding any further with that order. At what stage, if any, does the court become unable to affect the proceedings for the order that introduces something incompatible, except by declaring incompatibility? I am puzzled by this. I will read what the Minister has said in Hansard, but if I am not satisfied, I may feel it necessary to re-table the amendment at Third Reading in the hope of getting more clarification of what the Minister and the Government think the actual position is. For the time being, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 15 [Determination of Parliamentary procedure]:

[Amendments Nos. 30 and 31 not moved.]

Clause 16 [Negative resolution procedure]:

[Amendment No. 32 not moved.]

After Clause 20, insert the following new clause-

“APPLICATION OF HUMAN RIGHTS ACT 1998

Orders made under this Part shall be treated for the purposes of the Human Rights Act 1998 (c. 42) as subordinate legislation and not as primary legislation (whether or not they amend primary legislation).”

The noble Lord said: My Lords, I shall deal with the amendment very briefly because we dealt with a large part of its purpose in the previous debate. I draw the attention of the House to paragraph 1.15 of the 21st report of the Joint Committee on Human Rights of the current Session, which says:

“We therefore remain of the view that a provision should be inserted into the ‘Restrictions’ part of the Bill making clear that no order made under clause 1 of the Bill amending, repealing or replacing any legislation shall be treated as primary legislation for the purposes of the Human Rights Act 1998. We draw this matter to the attention of each House”.

Of course, we all regard the Joint Committee on Human Rights as extremely important and believe that its views must be greatly respected. If its view was adopted, we would avoid the difficulties that seemed to arise in the debate on Amendment No. 29, because it would be perfectly clear that the court would have the power to strike down an order that was incompatible in the same way as it can strike down an order that is made ultra vires, irrationally or without the proper procedure. The amendment, if accepted, would clearly improve the Bill. I beg to move.

My Lords, we share the view of the Joint Committee on Human Rights and support the amendment tabled by the noble Lord, Lord Goodhart, again for the reasons that he has already given.

My Lords, I think that the noble Lord, Lord Goodhart, in proposing this amendment, seeks strangely to replicate a similar provision in the Civil Contingencies Act. There is a considerable difference between orders made under that Act and orders made under the Bill, in that the former have only a short-term effect, usually for a maximum of 30 days, if I correctly recall that legislation, on which I spent some time. The problems of retrospectivity do not arise if they are struck down. In contrast, orders made under the Bill are intended to make permanent amendments to the law.

This amendment would also lead to a situation where provisions of primary legislation would be divided into different categories. Whether or not the courts could strike the provisions down would depend on whether they had been inserted or amended by subordinate legislation. In some cases, it might be very difficult to disentangle what could be struck down and what could not be. This situation does not technically arise under the Civil Contingencies Act because orders under that Act disapply or modify the application of primary legislation, rather than make textual amendments to it. There are of course other powers to make secondary legislation which textually amends primary legislation. For the purposes of the Human Rights Act, none of these is subject to the rule which Amendment No. 33 seeks to impose on orders made under this Bill.

I have already explained why emergency regulations made under the Civil Contingencies Act are very different from those made under this Bill and secondary legislation made under other enabling powers. Given the other safeguards in this legislation, I do not accept that it is necessary to change the way in which Parliament has decided in the Human Rights Act that incompatibility with the convention rights should be dealt with. I should reiterate the Government’s clear interpretation that it is already unlawful to make secondary legislation that is incompatible with the convention rights—the issue that we dealt with in the previous debate.

Moreover, where primary legislation—including as amended by secondary legislation—has been declared to be incompatible by the courts, the Government have always responded positively to that declaration by proposing appropriate remedial action to Parliament. For those reasons, notwithstanding the noble Lord’s point about the Select Committee on Delegated Powers and Regulatory Reform, I cannot support the amendment. I do not think that it matches the purposes of this Bill.

My Lords, I am sorry to have that negative reply to what seems a useful amendment. During this debate, it has become apparent that Amendments Nos. 29 and 33 are quite closely linked and should probably have been grouped. If I bring back Amendment No. 29, as I suggested I might, I would probably bring back Amendment No. 33 with it so that they can be considered together. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

After Clause 20, insert the following new clause-

“PUBLICATION OF DEPARTMENTAL PROGRESS

(1) A Minister of the Crown must make available to the public in an accessible format-

(a) all proposals promoting regulatory principles or removing or reducing burdens received by his government department; (b) his response to those proposals; (c) a summary of the action taken on those proposals, including any increase in regulation that may result; (d) a summary of any other action taken to promote the regulatory principles or remove or reduce burdens, including any increase in regulation that may result; and (e) any order made under section 1 or 2, including any increase in regulation that may result.”

The noble Lord said: My Lords, this new amendment develops some amendments which were tabled in Committee. It would require departments to report to Parliament about their steps to reduce regulation and any orders they have made under this Bill. It also addresses the possibility of changes in regulation leading to an increased burden. The previous amendments were criticised by the Government for wasting Parliament’s time or for being unnecessary.

This amendment would ensure that departments make public their steps to reduce regulation. There is already a better regulation portal on the web under the Cabinet Office. While this is a good way to encourage people to report instances of bad regulation, it is not enough to hold the Government to account. Publishing proposals and their responses will save departmental time wasted on responding to duplicate proposals. It will highlight the possibility of making proposals to the wider public and will allow people to show additional support for a proposal already made. The increased transparency would also show what departments were doing towards deregulation. In addition, highlighting where regulatory burdens will increase will provide greater accountability and invite greater rigour in judging whether the increases are necessary. I beg to move.

My Lords, I rise briefly because I have added my name to the amendment. It strikes me as extremely sensible, not least for the reason just given by my noble friend, which is one of transparency. One would hope that it might also act as an incentive to Ministers actually to get on with deregulation. As we discussed at Second Reading, the real problem is not with Parliament, but with government. Anything that gives a spur to action is to be welcomed.

My Lords, I start by thanking the noble Lord, Lord Howard of Rising, for introducing the amendment, and the noble Lord, Lord Norton of Louth, for his contribution. Although we are unable to accept it, I have an opportunity to explain what the Government are doing in this area. Amendment No. 34 concerns the procedures in place for ensuring progress in delivering the better regulation agenda. I support the notion that we should be looking constantly to see how well reforms are working. Indeed, no one could argue that this Government do not take seriously their commitment to regulatory reform. Government departments already report on their better regulation work as part of their annual reports, and they have done so for the past two years. Departments are being asked to provide rolling programmes of simplification and set targets for reductions in administrative burdens. Simplification plans will be published shortly. Plans will clearly be expected to list all better regulation proposals developed by departments and summarise how measures to reduce regulatory burdens will be taken forward. Where these proposals require amendments to primary legislation, they may well benefit from the powers in this Bill, and to ensure effective delivery without the need to wait for a Bill.

The better regulation portal referred to by the noble Lord, Lord Howard, is also available to provide an opportunity for businesses, public and voluntary sector organisations, and individuals to make suggestions for where regulation could be simplified. Work is being done to make this process more transparent and to make public all proposals received, along with the departmental responses to those proposals.

Our commitment to deliver on the better regulation agenda is evident in our achievements to date and in our ambitious programme to build on these successes. We have listened to businesses, public and voluntary sector organisations in order to take forward one of the most radical regulatory reform agendas in the world. My concern with the specific amendment proposed here is that in practice it would both replicate existing efforts and impose an unnecessary and bureaucratic set of statutory requirements on departments. What we do not need is a prescriptive and inflexible target on the statute book, especially one which requires that departments focus on continual reporting and detracts from real efforts to cut red tape. Moreover, Part 1 of the Bill obliges Ministers to submit an explanatory document to Parliament when laying a draft order including an assessment, so far as appropriate, of the extent to which the order would remove or reduce any burdens. The amendment would further duplicate the requirements on departments to conduct comprehensive impact assessments on all new proposals for regulatory reform.

The independent Better Regulation Commission will scrutinise and comment on simplification plans. We also expect the Regulatory Reform Committee in the other place to play a key role in monitoring departments’ progress. We have been working closely with the committee to develop a new and expanded remit to enable it to report on wider regulatory reform issues. Its wider role will complement the work of relevant committees of this House in ensuring that there are consistent and focused efforts to deliver on the Government’s commitment to ease burdens across sectors in the UK. We welcome engagement and suggestions from committees of both Houses on the agenda. For these reasons, I consider the amendment unnecessary and I urge the noble Lord to withdraw it.

My Lords, as my noble friend Lord Norton commented, it is lack of action that is the problem. I think it is regrettable that the transparency which this amendment would introduce is not to be pursued by the Government as it would enable any lack of action or action to be monitored by a much wider public. It would perhaps bring those Ministers reluctant to deregulate to account. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 26 [EEA agreement and EEA state]:

Page 15, leave out lines 14 and 15 and insert “modified or supplemented from time to time.”

On Question, amendment agreed to.

Clause 28 [Power to make ambulatory references to Community instruments]:

Page 17, line 9, at end insert-

“(1B) Where subordinate legislation creates any new or amended criminal offence the subordinate legislation shall contain, in the text and not solely by reference to a provision of the Community instrument, a description of the conduct which, if proved, would constitute that offence.”

The noble Viscount said: My Lords, with this amendment I am returning to a point that I raised in Committee. I think the noble Lord, Lord McKenzie of Luton, who dealt with it on that occasion, will probably concede that no very careful consideration was given to the points that I raised, but that has now been repaired. Nevertheless, I must set out my stall. I appreciate that all those noble Lords who have not already caught their trains home are dying to do so, but I must try to set out the problem so that the House can understand what I am talking about.

The problem concerns the formulation of criminal offences which arise out of the transposition of European instruments into British law. Let me give an example of this. Under instrument 1228 of this year—which covers the very important subject of transmissible spongiform encephalopathy—where any premises are occupied and licensed, an occupier commits an offence if he maintains and operates the premises other than in accordance with,

“the requirement of the Community TSE Regulation and these Regulations”—

and there are some fairly substantial penalties.

How do you comply with the requirements of the Community TSE regulations? The instrument earlier states:

“Expressions that are not defined in these Regulations and occur in the TSE Community Regulation”,

have the same meaning here as they do there.

So what is the TSE regulation? It is contained in a schedule and consists of a list of 27 different instruments which have emerged from the European Commission over a period of time, some of them quite recent but many of them amending others. Nowhere in the regulation is there a definition of the offence, simply that you can fail to comply with it.

The Bill is about transparency and reducing burdens, and, under the terms of the Bill, “burdens” include criminal sanctions. It is ordinary good sense that people should understand what they are forbidden to do. I think it is also in accordance with Article 7 of the European Convention on Human Rights that they should know this. There has, however, occurred a massive practice of simply transposing European regulations without ever saying what they mean and what are the offences created under them.

I have been very worried about this. I have been sitting on the Merits Committee for some time and British regulations after regulations occur where we have exactly this problem. I was greatly relieved to find that I am not alone in being upset about this. In the Third Report of the Joint Committee on Statutory Instruments in 2001, the committee, which, of course, contains Members of this House and another place, concluded that in its view the regulation it was considering—it was in exactly the same form as the one I have been talking about—was not consistent with the United Kingdom’s traditional legislative practice of precision in the formulation of criminal offences, and it reported that provision for defective drafting. But nothing has been done and the situation continues as before. When we asked in the committee why this was so, one of the answers was that “because EU Regulations”—the TSE one was a regulation,

“are directly applicable in law in all countries, normal drafting practice is to avoid repetition of EU regulations provisions in domestic legislation, as it may result in duplication or in the meaning or effect of the Regulations being obscured”.

I doubt whether it could be much more obscure than it is at the moment.

That is not true. I am talking in particular about Defra regulations but this applies to other departments as well. Some other regulations were recently produced by Defra where exactly the opposite of what I have just read out has been applied. SI 2005/3522 related to the disposal of older cattle and slaughterhouses. I drew it to the noble Lord’s attention in Committee but he did not comment on it. In the schedule is a parallel set of columns. The first refers to the provision of the Commission regulation that the SI is referring to, while the second contains the subject matter of the offence that will be committed if you do not pay attention to it. So it is not true that you do not put into the British regulation some indication of what you must do to avoid getting into trouble.

There was another very good example in SI 2006/1970 relating to sea fisheries. Here is a whole collection of requirements, again relating to a Council regulation about fishing, fines, and so on. There are three columns: the first refers to the provision of the regulation; the second refers to the subject matter of the offence which you would commit if you were not careful; and in the third column is a very large which you are liable to if you offend. That comes from the same department which said it was impossible to put this into British regulations. There they are. As I said, it is not simply Defra which does this; a number of other departments, including the DTI, do the same.

We do not comply with the transparency provisions underlined by the Bill and we do not comply with the reduction of sanctions in the term of what constitutes a criminal offence underlined by the Bill. The noble Lords, Lord McKenzie of Luton and Lord Bassam, have taken a good deal of trouble to have a meeting with me and to discuss these points with officials, and I am very grateful to both of them. I am told that they do not like my amendment. Well, there is nothing new in that, is there? What amendment has ever been liked by Government? Nevertheless, I think they concede that there is a point. I see them nodding, which means that perhaps there is a point.

The noble Lords have suggested that this problem should go to the review being carried out by the noble and learned Lord, Lord Davidson of Glen Clova, which is to report very soon. I was today given the consultation documents that have so far emerged. This is primarily concerned with that very eminent topic, gold plating, and its two close friends, double banking and regulatory creep. I do not think that the terms of reference are entirely apt to deal with what I am talking about, but there is a passage that gives me a little cause for encouragement.

The noble and learned Lord refers to the tradition of precise drafting, aimed at reducing uncertainty in this country, and contrasts it with a more purposive approach adopted by the legal systems of some continental member states as well as by the European Commission, which broadly speaking deals in civil law rather than common-law terms, and the methods with which we are familiar in this country.

If the Minister is going to say that he does not like my amendment, I shall not be surprised, but something here needs to be attended to. It is not just businesses and charitable and voluntary organisations which are affected by these rules; it is also individuals We cannot have a situation where a farmer confronted with this kind of regulation would have to spend a great deal of time looking up, for instance, 27 different European instruments on the internet, if they have it and are able to use it, and then see whether what they were doing complied.

This approach has been criticised also by those whom we in the committee have in our turn criticised as being faulty because what is done in this country might not be the same as what is done in other European states. A recent example in the latest report of the Merits of Statutory Instruments Committee will come before your Lordships, and some noble Lords might like to think about it.

An ancient, 1985 directive relates to uncultivated land, and doing things to it to make it cultivated, as well as to restructuring projects. Nothing in the European legislation defines either “uncultivated land” or “restructuring projects”. Therefore, some time ago—I think it was in 2001—the Government introduced an uncultivated land provision by way of statutory instrument and laid down a threshold of two hectares. If you carry out operations on that land, you are in for trouble. There was an instance of somebody who spread lime on an environmentally sensitive piece of grassland in York and was heavily fined for doing so. There is no threshold equivalent to two hectares that I know of in any other European country.

Then, quite apart from that, the statutory instrument examined in the latest Merits Committee report introduces the restructuring programme. Nobody knows what “restructuring” means. Nobody knows what area it relates to, and Defra has made up the rules—they may be very sensible. They relate to the things that “restructuring” may convey. However, all I can tell your Lordships is that our rules are seriously different in extent from those in Ireland, Belgium and the Netherlands. It is therefore no use saying that, because the offences are not specified, we are liable to get into trouble by not conforming to what is happening in the rest of the European Union—we are already doing so.

What is going to be done about this? If the Minister does not like my amendment, he must first of all assure me that the noble and learned Lord, Lord Davidson, will be able to deal with this point, because I doubt that it is within his terms of reference. If he is not, the Cabinet Office will have to provide instructions to parliamentary clerks in various government departments on how to draft regulations. They are going to have to pay attention to what the Joint Committee said five or six years ago. If they do not, we will not be sticking to the precepts that underline this Bill—transparency, and the removal of sanctions. This is an occasion when we must really emphasise that government departments should pay attention to this problem. It is no use leaving it on the basis that you can look it all up on the internet or find some other method of dealing with it.

The other thing that the Joint Committee said was, “Oh, well, it’s always covered by guidance”. So it is, but guidance does not do any good in a criminal court, nor does a criminal court have access to the guidance. Indeed, I do not think that the criminal court has access to the European legislation either. When I used to sit at Harrow, there was no indication in the library of the official journal in which one could look all those things up, and I very much doubt whether it would have been readily obtainable by me as a judge. Goodness knows what is going to happen to the clerks to magistrates’ courts when they are confronted with this—because that is where the majority of the cases are going to go.

There are provisions which apply the prohibitions with a sanction that includes prison. I very much trust that that is not the course that will be taken. Fines are much more likely to be effective. Nevertheless, somebody has to impose the fine and find out what offence is alleged to have been committed. So ought people to be able to find out what the offence is before they decide whether they are going to commit it. That is one of the basic principles of criminal law in this country. I beg to move.

My Lords, I supported the noble Viscount in Committee when he moved a similar amendment. I said at that time that, having served with him on the Merits of Statutory Instruments Committee, I had always been immensely impressed by the amount of work that he put in to trace the roots of every instrument that came before that committee. It took a formidable amount of work and his kind of legal brain to be able to do that.

I do not know what my noble friend is going to say about the amendment, but there is a general point to be made and somebody somewhere ought to look after this matter. When these regulations or orders are published they should contain a succinct summary of all the previous relevant orders and where people can find them. I hope that the Government will also make available an electronic dictionary so that, at the touch of a button, anyone can trace all the 25 or 27 previous items involved in such legislation. That should not be difficult to do. From what the noble Viscount has said, I am convinced that lots of small businessmen, farmers and ordinary people are harassed by such regulations, so we should do whatever we can. What could apply under Clause 1(3)(b), (c) and (d) supports the amendment. I hope that somewhere in the system there is a positive response to what the noble Viscount has suggested.

My Lords, I was not tasked by my Front Bench to reply to this amendment, and I find myself somewhat shaken to have to do so. Unfortunately, I missed the noble Viscount in Committee; I was probably one of those who took an early train home. However, as I understand his remarks, he is referring to European Community regulations—

Lord Kingsland