Committee (6th Day)
Relevant documents: 13th Report from the Delegated Powers Committee, 14th Report from the Constitution Committee and 11th Report from the Joint Committee on Human Rights.
240M: After Clause 119, insert the following new Clause—
“Purchase of alcohol on behalf of children
(1) In section 149(7)(b) of the Licensing Act 2003, for “level 5 on the standard scale” substitute “£10,000”.
(2) The amendment made by this section applies in relation to offences that are committed on or after the commencement of this section.”
My Lords, this amendment, supported by my noble friend Lady Finlay of Llandaff, would insert a new clause in the section of the Bill that deals with selling alcohol to children. I first place on record my gratitude to the Minister for meeting me to discuss my concerns and for writing to me in detail about them. Nevertheless, I hope still that I might persuade her that my amendment merits further consideration and that she might agree to come back with something on Report.
I should declare various interests. I am a former chief executive of the Portman Group and a former member of the Alcohol Education and Research Council. I currently work as a paid adviser on corporate responsibility to two drinks companies whose names are listed in the register. I emphasise that I provide them with non-parliamentary advice, and I have had no discussion about the Bill with either company.
The Bill already proposes to double the maximum fine for persistently selling alcohol directly to children from £10,000 to £20,000. My amendment applies the same principle to the offence of purchasing alcohol on behalf of children, an offence that is often overlooked but which is regarded by many local police forces and local authorities as the more serious in terms of its prevalence. The offence of purchasing alcohol on behalf of children is commonly known as “proxy purchase” and occurs when someone over 18 agrees to go into licensed premises to buy alcohol in order to hand it over to a child aged under 18 waiting outside. The current maximum fine is £5,000, or level 5 on the standard scale. I suggest that if the Government believe that a strong message needs to be sent out on underage sales by doubling the fine for that offence by licensees, it follows logically and all the more strongly that a clear message needs also to be conveyed that proxy purchase by unscrupulous members of the public is completely socially unacceptable, immoral and illegal, and should attract rigorous enforcement with harsh penalties.
As I said in the debate at Second Reading, the incidence of prosecution and conviction for this offence of proxy purchase may be low but is nevertheless much higher than for illegal sales direct to children. In 2009, the last year for which figures are available, there were only four prosecutions for persistently selling to children, compared to 29 for proxy purchase. It would be a wasted opportunity not to take advantage of the Bill to ramp up the maximum penalty in the same way as is envisaged for direct underage sales.
I know that the Minister is rightly concerned that this legislation should be proportionate and consistent. I agree. I was a member of the Better Regulation Commission when it developed the five principles of better regulation, of which proportionality and consistency are two, and I believe that my amendment ticks exactly those boxes. If the Government think it is right, and therefore proportionate, on the basis of the prosecution figures I have just given, to double the maximum fine for persistent sales to children, then surely it would be consistent, right and proportionate to do the same for proxy purchase when we know that the level of harm and potential harm are at least as great.
We know quite a bit of detail about which children are gaining access to alcohol through proxy purchase. A survey in 2008 of 11 to 15 year-olds for the National Health Service Information Centre revealed that a total of 34 per cent of these young children, some of them not even yet teenagers, got their alcohol from other people buying it for them—in some cases people who were related to them—but 18 per cent of them got it from strangers.
When you look more closely at the figures, you begin to see just how worrying this behaviour is, how potentially vulnerable these children are and how important it is that we do everything we can to deter adults from agreeing to engage in proxy purchase. For example, although 18 per cent of children overall said that they had asked someone else other than a relative to buy alcohol for them, this figure rises to 41 per cent of 15 year-olds. Among the children who are drinking most heavily, defined as over 15 units a week, the figure rises to a staggering 88 per cent who used proxy purchase. When we compare the behaviour of boys and girls there are also significant differences, with 10 per cent of 13 year-old boys relying on proxy purchase but 14 per cent of girls. At age 15, that rises to 38 per cent of boys but 43 per cent of girls.
I am especially concerned about the potential danger in which these very young girls are placing themselves by approaching strangers in the street and asking them to buy alcohol. If an adult is irresponsible enough to agree to do that, what other dangers or risks might these vulnerable girls be exposing themselves to? I emphasise that this survey shows proxy purchasing to be a much more serious issue than under-18s buying alcohol for themselves. Only 6 per cent bought or attempted to buy alcohol from a shop, and only 4 per cent from a pub. The survey shows that the proportion of teenagers who manage to buy for themselves has declined significantly since 1996. I would not want to sweep that problem under the carpet, because it remains a fact that most of those few who do so are successful in achieving their purchase. The fact that some are not and that many more no longer even attempt to buy for themselves shows that the co-operative efforts of licensees, local authorities, the police and dedicated community groups promoting more rigorous use of proof of age at point of sale has been paying some dividends.
Even so, the Government have seen fit to include in the Bill the doubling of the maximum fine for licensees who still sell to the under-aged. Fair enough, but why ignore the more pressing issue of proxy purchase when it would be simple to include a similar amendment along the lines that I have suggested? Another piece of research was published only last month by the Drinkaware Trust, this time concentrating on where slightly older teenagers, aged 15 to 17, get their alcohol. Here, too, we see that those who are drinking in the most risky and potentially vulnerable situations—outdoors, rather than at home, at a party or a friend’s house—are the ones who most rely on proxy purchase, with 19 per cent—almost one in five—saying that they asked a passer-by to get them their alcohol from a shop.
On the basis of all this evidence—and the Government say that they are committed to evidence-based policy—I urge the Minister to agree that my amendment would be a sensible and justified logical extension to this section of the Bill. As I said at Second Reading, the penalties for these offences are relatively meaningless unless the law is rigorously enforced. I hope that the Government will also be doing something to encourage the police, local authorities, trading standards and the licensed trade to do even more to stamp out illegal sales to children and proxy purchase. It might be a little more complicated than underage sales because it involves indentifying and pursuing members of the public rather than slapping an extra fine on licensees. But if this is the offence which is doing most harm to young drinkers, especially those who are most vulnerable because of their age, sex and consumption patterns, surely we must do whatever we can. I beg to move.
My Lords, I have added my name to this amendment in support of my noble friend Lady Coussins. I am grateful to the Minister for all her interest and concern over alcohol as a problem. I know that she has expressed a view that this is not the direction in which the Government wish to go, but I hope that she may be persuaded to think again. When we pass legislation such as this, we need to send a clear social message to the rest of society.
There is some evidence that if you teach children to drink responsibly and socially at home they will be less likely to abuse alcohol. Sadly, that is now tremendously outweighed by the data of children being initiated into binge-drinking by adults proxy purchasing for them. Some of the statistics have already been alluded to, but there are many more. An interesting study from the Portman Group itself showed that one-third of adults have been asked to buy alcohol on behalf of someone under 18 and one-third of those have admitted to buying it. A quarter did not realise that it was an offence; 30 per cent did so because they felt intimidated by the young person; 30 per cent thought that it would not do any harm; and 70 per cent did not realise that they could be prosecuted for doing so. That demonstrates an enormous ignorance both of the criminality involved and of the harm that they are doing to children. It is also a terrible indictment of young people that their behaviour was so intimidating that they pushed someone into buying alcohol for them. As has already been said, the number of prosecutions is horribly light.
What about the impact on these young people in the long term? About 7,600 school-age children are admitted to hospital annually with alcohol-related conditions. These are not just minor conditions; some are admitted in coma with alcohol toxicity, liver failure and vomiting which may be so severe that they become severely dehydrated and need intravenous rehydration. We know that a car is more likely to be involved in an accident when the passengers have had too much to drink—even if the driver is not drunk—as their irresponsible behaviour may result in the driver not being able to concentrate.
These young people also suffer from chronic problems. They have a higher incidence of depression and mental health problems in later life, weight loss and chronic liver damage. It is clear from a study in the British Medical Journal that men who drink more than seven units a week at the age of 16 are one and a half times more likely than light drinkers to binge drink in their 30s and 40s. By not sending out a clear message to society, we are complicit in encouraging youngsters into a binge-drinking habit. We are saying, “It is okay, we will turn a blind eye to it”, but the size of the problem means that it cannot be looked at with Nelson’s eye. I commend the amendment to the Government and hope that they will take it very seriously.
My Lords, I support the amendment for the reasons set out so eloquently by the two noble Baronesses who have spoken to it. I realise that it is not a natural fit with the Bill and that it moves it into territory for which it may not have been originally designed. However, it provides the Government with an opportunity to reinforce the condemnation of the proxy purchasing of alcohol by adults for children. At one end of the scale this proxy purchasing can be due to chance and the stupidity of an adult responding to a request from a child or young person to buy the alcohol, but often it is more sinister. Some adults hang around young people and proxy purchasing of alcohol can be the beginning of grooming children and young people to draw them into inappropriate sexual behaviour, drugs misuse or even into membership of gangs on estates. Proxy purchasing by adults is a way of enabling them to talk to the youngsters and draw them into inappropriate behaviour. It is largely the result of stupidity and indifference but can be more sinister. As I say, although the amendment is not a natural fit with the Bill it provides the Government and the Minister with an opportunity to reinforce the message that we condemn this behaviour on the part of adults. I hope that they will find a way to support the aim of the amendment.
My Lords, we on this side of the Committee support the amendment in the name of the noble Baronesses, Lady Coussins and Lady Findlay. They have given us a very graphic set of reasons why it would fit well with the intentions of the Bill. We have also heard some very scary statistics. In essence, the amendment would close a loophole. The Government may, on reflection, agree that that is the case. We understand that proxy purchasing is now regarded by the off trade, the on trade and the trading standards groups as the biggest challenge facing alcohol sales. The amendment would also bring the fine into line with the current level imposed for persistently selling alcohol to children, which is why I think that it is a good way of closing the loophole.
However, we are advised that retailers are often frustrated with the lack of action being taken against those who deliberately buy alcohol to be consumed by those who are under age. Therefore, although we support the amendment and hope that the Government will consider it favourably, there needs to be a commitment to place greater emphasis on identifying these people and seeing through the legislative consequences of the amendment, which is that action must be taken. As we have heard from the previous speaker, that is an important aspect of what we are about. However, the amendment justifies itself in its own terms.
My Lords, we are legislating in Clause 119 to double the maximum fine available to punish the persistent sale of alcohol to persons under 18 from £10,000 to £20,000. The amendment seeks to go further in doubling the maximum fines available for two other offences in the Licensing Act 2003, from their current level of £5,000 to £10,000. The offences relate to where a person buys or attempts to buy alcohol on behalf of a person under 18, or where a person buys or attempts to buy alcohol for consumption on licensed premises by a person under the age of 18.
At a first glance, we can see merit in the proposed new clause. My noble friend and I are absolutely with the noble Baroness in her strong feelings about the proxy purchase of alcohol for minors, and we take this very seriously. I hope that the noble Baroness will recall how we have responded to related amendments in earlier discussions in Committee. However, it is important to maintain consistency in the sentencing framework.
In addition to the two offences that I mentioned, a number of other offences currently exist for offences in the sale of alcohol to those under 18 or the consumption by those under 18 on licensed premises. They include knowingly allowing consumption of alcohol on licensed premises by an individual under 18. For all these other offences, the penalty is a maximum sentence of £5,000—level 5 on the standard scale in the sentencing framework.
In our view, however, the offence of persistently selling alcohol to children is distinct and distinguishable from the other offences in the Licensing Act and merits separate treatment in the Bill. It is far the more serious offence, not simply a one-off sale to or involving a person under the age of 18. This is reflected in the higher fine that the courts can impose for it. The offence of persistent sales to a person under 18 was created specifically to target irresponsible businesses rather than individual offenders. Indeed, there is an alternative to criminal prosecution for such premises—a punitive period of closure.
The fine for the offence of persistent sales, which stands at £10,000, was always intended to be set above the level 5 fine in the sentencing framework. The fine was high to reflect the seriousness of the offence and to reflect the intention of targeting irresponsible businesses.
In the Government’s view, increasing the maximum fine for the offence of the proxy purchase of alcohol for children, but not for others where individual adults have been responsible for providing or attempting to provide alcohol to children, could blur the existing distinctions in fines under the sentencing framework between offences targeting individuals rather than premises. In summary, we believe that the existing penalty for the proxy purchase of alcohol—a fine not exceeding £5,000—is sufficiently punitive for an offence by an individual. Yes, it is a serious offence, but not one that should be singled out for the provision of a greater fine than those for similar offences in the Licensing Act 2003 relating to the provision of alcohol to minors.
For these reasons, and having thought about it carefully, we believe that the offence of persistent sales of alcohol to children is sufficiently separate and easy to distinguish from the range of other alcohol-related offences in the Licensing Act. We want to send a clear message to irresponsible businesses that the persistent sale of alcohol to children is totally unacceptable. This is why we want to double the fine. All that I have said, however, should not be taken to mean that we will not look at the other alcohol-related criminal offences and consider whether further changes should be made in cases such as those that noble Lords have raised. Indeed, the Government are committed to a full examination of sentencing policy across the board. I can also say that we will look at the points raised by noble Lords in the context of the alcohol strategy that will be published later this year. For the reasons that I have outlined, we ask that the amendment be withdrawn.
My Lords, I am grateful for the support expressed by other noble Lords for the amendment. I cannot say that I accept the logic that proxy purchase is an offence of such a different order from persistent sales to children as the Government suggest. I stress that I am not seeking to make the maximum fine the same, but just to apply the same principle of doubling that fine as a signal that the harm and potential harm behind that offence is recognised.
I do not accept that my amendment would blur the distinction between the offences. However, I am encouraged by the Government's signal that the dangers of proxy purchase will be looked at again in the context of the revised strategy that we are expecting in the autumn and of a more widespread look at sentencing policy in general. Perhaps we can return to the issue, because it will continue to cause harm, and there is a higher incidence of proxy purchase than of persistent sales to children. The issue will not go away but, for the moment, I am content to withdraw my amendment.
Amendment 240M withdrawn.
Amendment 240N not moved.
Clause 120: Early morning alcohol restriction orders
Amendment 240P not moved.
240PA: Clause 120, page 79, line 15, leave out “and club premises certificates”
I shall speak to all the amendments in this group, other than Amendments 240V and 240X, and also touch briefly on clause stand part. I nevertheless support Amendments 240V and 240X, which seem extremely sensible.
All my amendments in the group are designed to mitigate Clause 120, which radically alters the impact of Sections 172A through to 172E of the Licensing Act introduced by the Crime and Security Act last year, in that they can now be imposed from midnight to 6 am instead of from 3 am to 6 am, and on the say-so of the licensing authority, not the full council as before.
First, I take Amendments 240PA and 240PB, which are designed to remove private members’ clubs from the scope of the clause. The proposed amendments to the Licensing Act 2003 in the Bill—the late-night levy and the early morning alcohol restriction orders—are designed to tackle issues relating to licensed premises, largely on the high street, that sell alcohol for consumption on the premises to members of the public. In contrast, private members’ clubs are not selling to members of the public but are membership-based. They also, by and large, are not positioned on the high street or close to centres of the night-time economy, because their original remit, which has not changed, was to serve and be at the centre of the community in which they were located. They not only provide a valuable service to their members but have responsibility for the conduct of their members in the community. They have a self-regulatory process, which enables censure by the committee of individual members' conduct.
On the basis that there is self-regulation and the recognition that private members’ clubs do not contribute to the issues which have prompted the proposed provisions of the levy and restriction orders, the clubs should be exempt from the measures. Not only are they particularly onerous in the extra revenue that will be required to pay for the levy, which we will deal with later, the loss of facilities after midnight under the early morning restriction order provisions will further curtail the revenue stream which is critical for their survival. The membership of clubs is reducing and revenues are decreasing. DCMS statistics show that, as well as all the pubs that have closed, the net reduction in clubs operating with a club premises certificate has reduced by 300 per year from 2008 to 2010.
Younger members of the community in which the private members’ club thrived now have a much wider choice of venues, which are on the high street, and have other interests which do not include the traditional club environment. Nevertheless, those clubs and their facilities continue to be important, and we should protect them against changes which will have a significantly detrimental effect on their survival.
Moving on to Amendments 240Q to 240W, Amendment 240Q makes a modest proposal of a 1 am start time for EMROs, rather than midnight. Midnight is far too early in the circumstances and out of step with today's customer expectations. Frankly, putting the beginning of the EMRO at midnight could be a business-killer for many businesses. Amendment 240R removes the restriction on temporary event notices which an EMRO would impose.
Amendment 240T provides for personal licence holders to be included in the definition of affected person. A number of pub companies and breweries hold the premises licences for the premises they own and rent or lease out as individual businesses. While all tenants and lessees will be personal licence holders, they will not necessarily be premise licence holders and would therefore be excluded from the local consultation process under the current provisions. This amendment ensures that they will have a voice in any local consultation on the introduction of an EMRO.
Amendment 240W would ensure that the imposition of early morning restriction orders does not apply to New Year’s Eve and thus undermine the opportunity for celebration in those areas where they do exist.
Turning to Amendments 240RA and 240RB, there is no mechanism currently for a review to determine whether EMROs remain necessary or appropriate. If EMROs are to provide an opportunity to redress the problems that have arisen, such an opportunity will be lost if they are applied without limit. Without such a provision there will be no incentive for local authorities to undertake a review of an order or to determine whether it is still required. Businesses that suffer loss of income and value as a result of an EMRO, through, as it is admitted, no fault of their own, will be deprived of the opportunity to revisit the circumstances surrounding the placing of an order and will suffer permanent damage as a result.
Two years is a reasonable timeframe within which councils, police and the hospitality trade and others can work together to address the fundamental problems that have led to the imposition of an EMRO. EMROs will impose significant burdens on those businesses upon which they fall and it must be right for those businesses to be able to see an end to the restriction through the need to reapply after two years for a further EMRO which would have to be re-justified. As it stands, there is no incentive for a council to lift an EMRO once it is in place, given that the council will have to repeat the procedures contained under proposed new Sections 172A and 172B. This amendment ensures that the council cannot simply leave an EMRO in place without reconsideration of the need.
Moving on to proposed new Section 172C, trading hours that have been granted form part of the intrinsic value of a business and the permanent removal of later opening could damage the long-term value of a business. Were licences to be changed to reflect the removal of those hours, they could only be restored by a reapplication at the termination of the EMRO, when there would be no guarantee of the permissions previously granted. At the same time, conditions may have been placed on those businesses which reflect the later opening hours employed by them. A restriction of those hours would very likely change the nature of that business such that the conditions would no longer be necessary or appropriate. Given that those businesses could already have suffered a significant loss of business and shed employment as a result, a further burden of conditions that relate to the later opening could impose further costs on a business that might already be struggling. These amendments give effect to the suspension of such conditions.
I appreciate that such conditions will not always be readily identifiable as they might be more related to the nature of the business rather than specifically attached to the later hours. A nightclub that has had its hours restricted to midnight might need to reconstruct its business since the closing time makes it unattractive as a nightclub. In such cases the condition for door staff might be dispensed with or reduced without any detriment to the licensing objectives, while allowing the business to reduce part of its costs.
The need for the legislation to take account of the cost burdens imposed on the businesses that are affected, through no particular fault of their own necessarily, reflects the potentially unfair and untargeted nature of the proposed measures. I am not going to steal the thunder of the noble Viscount, Lord Astor, on clause stand part, but the number of amendments I have tabled regarding this particular clause demonstrates the very difficult nature of not only the current amendments but also the original legislation contained in proposed new Section 172A onwards.
The ministerial forwarded and the Government’s response to the consultation on the Bill recognise and acknowledge that the majority of premises are well run businesses. The Minister has stated that the measures to be introduced have been designed to be used flexibly by licensing authorities to avoid penalising the majority of premises that sell alcohol responsibly. Unfortunately, the early morning restriction orders do exactly that, in so far as businesses that have applied for and been granted hours beyond midnight, until 1 am or 2 am, for example, will be penalised, through no fault of their own, if such orders are imposed, despite the fact that those businesses have not been the cause of any trouble leading to the consideration of the EMRO. They will be simply swept up in a requirement to cease trading at midnight.
It is not clear that under this current clause, and indeed under the original legislation introduced last year, there will be satisfactory exemptions from EMROs. It is important that exemptions recognise best practice and social responsibility initiatives rather than being based solely on premises type. This would ensure that well run businesses that would not qualify for an exemption according to premises type are not unduly penalised by the provisions. Rather than introducing such a blanket measure, which itself risks large numbers of customers coming out on to the streets at the same time, just like the bad old days, would it not be more practical to tackle the premises that are the source of any problems rather than penalising responsible premises?
In terms of the flaws in the clause and in the original legislation, I very much hope that the Minister will agree to reconsider and come back with something far more satisfactory on Report.
My Lords, I added my name to the amendments moved by my noble friend Lord Clement-Jones and also to the clause stand part. I do not intend to go through the basket of amendments that the noble Lord has moved but will confine my remarks to clause stand part and to one amendment in particular, Amendment 240Q, which relates to proposed new Section 172A(3)(a) in Clause 120(3), where it says “begin no earlier than midnight”.
This amendment and this clause are so important because it seems to me that the Government are attempting to change the policy of late-night bars and how they operate. They are in effect saying, “We are going to make it very easy for anybody to close everything at midnight”. For operators who have a 3 am licence, it is an incredibly important part of their business, for a number of reasons. In fact, that is often the bit of the business that makes the whole operation profitable. In my experience there has been no great push from the police to bring everything forward to midnight. Indeed, as the noble Lord, Lord Clement-Jones, said, in many areas the police would prefer it to be 3 am because people start leaving from midnight onwards and there is a gradual trickle of people going home, as opposed to the ugly rush there would be at midnight, leading to all kinds of problems of disorder. At 3 am most people have gone, with a few stragglers remaining. Equally, there does not seem to be any evidence that local authorities have been pushing to bring everything back to midnight.
I ask my noble friend the Minister to explain whether this really is a change of government policy by the back door, because that is what it looks like to the industry—if so, the Government should be honest and open and say what it is—or an attempt merely to give more powers to close down operators who are seen to be operating either out of their licence hours or breaking their licence conditions. There is no evidence so far in the industry that local authorities have any problems with operators who should be closed down. It is quite easy for local authorities to close down an operator, although there is concern about the legal costs of doing so. But most operators regard their licence as so important to their business that the last thing they want to do is jeopardise it. We need some explanation from my noble friend of what really is meant by Clause 120, as well as a satisfactory reply to deal with the concerns felt by many operators in the industry—and indeed not forgetting the poor customers.
My Lords, if the analysis of the noble Viscount, Lord Astor, regarding a change in government policy is correct, I welcome it. It is what the public want and, although some in the business sector will be unhappy about it, I think that overall this set of amendments would undermine the Government’s attempt to respond to the clamour which has increasingly grown up among the public at large and has been reflected in some of the work done in the consultation. Therefore, I hope that the Government will not backtrack and that they will dig in firmly and hold to their course on this. The public will certainly support them in that.
My Lords, I agree with my noble friend—to the extent of New Year’s Eve, at any rate. I have Amendment 240V in this group, to which the noble Lord, Lord Stevenson, has added his name. It would provide for permitted exemption categories and exempted days, and is part of a continued conversation about how far local variances should be reflected and the extent to which they should be centrally prescribed. Noble Lords will not be surprised that I always find myself at the local end of the spectrum.
This matter was brought to us by the Local Government Association. It seems that licensing authorities should be able to determine the categories of premises to be exempted from EMROs in their local area. This would not be novel, even in the context of the Bill, as it would mirror the late-night levy exemptions that licensing authorities can decide locally. There seems to be no logic for having different systems, particularly as I understand from the LGA that the Home Office has proposed to use the same definitions for categories of possible exempted premises for EMROs as for the late-night levy. The broader point, as I said, is local determination.
My Lords, perhaps I may make a very brief gloss on the speech of my namesake, the noble Lord, Lord Brooke of Alverthorpe. Reflecting back to the debates on the Licensing Bill in 2003, I think it would be fair to say—and I hope that those who were in the Chamber at that time would agree—that the arguments against the then Bill were led very much by those who had a lot of London experience. People who have a lot of London experience endeavour to mobilise opinion through the civic trust across the country, but it took quite a long time for that communication to take place during the passage of the Bill. It would be fair to say that those away from London were disagreeably surprised by some of the consequences of the Bill when they arrived in practice. I cannot sense totally from the speeches of my noble friends Lord Clement-Jones and Lord Astor how far they are centring on London experience in their observations but I think it is necessary to realise that we are dealing with a national issue.
My Lords, I confess at the start that I have a bit of sympathy with my noble friend Lord Brooke of Alverthorpe and his feeling that midnight is a good time to draw a curtain across many outside activities. I certainly always try to be in bed at 10 pm, although perhaps that is a baby-boomer problem. I like to sit in bed with a cup of cocoa looking at “News at Ten”, reflecting on the events of the day and preparing well for the events in this House and other places where one has to play one’s part.
However, on reflection, I think that we are hearing too much of a puritan strand here. The amendments raise a number of questions on which we need to think hard about what we should be saying to the country in terms of how we reflect on the relationship between the nanny state and those who have to live here. If there is a change of policy, I think it is probably wrongly focused, and the amendments expose that. It is clear that one has to deal with bad operators—a point made by those who have spoken before—but there is a danger here that, due to the way in which the Bill is currently phrased, it will catch everyone, and that will be bad.
Surely a blanket EMRO running from midnight is not going to be effective. It will severely damage those businesses unfairly caught by the legislation and the consequences could be severe for the night-time economy. I am particularly concerned about small live music venues that operate with a licence past midnight. Capturing them in an EMRO would do enormous harm and could damage the UK’s rich cultural diversity, of which we are so proud. At this time, many small venues are struggling to remain economically viable, and for venues that might get caught in such a blanket provision, this extension comes at a very bad time.
An EMRO applied indiscriminately to all businesses in a given area, as opposed to being imposed on individual premises known to contribute to alcohol-related disorders, would surely unfairly discriminate against responsible pubs and clubs, which is why we are arguing for exemptions. I particularly welcome the amendment concerning New Year’s Eve, and not just because of my Scottish background.
Perhaps I may give an example that might highlight the problems. It is an imagined live music venue—a small jazz club. A licensing authority has issued an early-morning restriction order to cover the boundaries of the whole city centre. Around the corner from a few known trouble spots is a small jazz café, whose clientele is characterised by, let us say, a more mature music lover. It is a small venue operating on a very tight margin but is well loved by its regulars, and it is a place where jazz musicians enjoy performing and jazz fans enjoy congregating. The club is busiest between midnight and 2 am. However, let us say that also within the city centre is a hotel with a casino. As a result of an EMRO, the jazz club will be forced to stop serving alcohol at midnight. It will therefore be compelled to reduce the number of musicians that it books and could gradually lose its clients to other venues exempted from the EMRO. If its revenue falls, it will be forced to close. Meanwhile, the hotel with a casino sees a rise in its bar takings well past midnight. Is that what we are trying to achieve? I think not.
Like the noble Viscount, Lord Astor, and the noble Lord, Lord Clement-Jones, I think that the provisions in the Bill are too broad in application, too aggressive in what they are trying to achieve and perhaps too puritan.
My Lords, I suspect from what I have heard in this debate that I am going to end up having “nanny” in front of my name. However, I shall be a benign, jazz-loving nanny, so perhaps that will be all right.
An early-morning restriction order is an uncommenced power that already exists under the Licensing Act 2003 and will allow licensing authorities to restrict sales of alcohol in the whole or part of their area for any specified period between 3 am and 6 am. The fact that it is an uncommenced order made us look again at what needed to be improved in the previous legislation.
I was asked whether this was a change in policy on the part of the Government. These orders are a power that local authorities can use to restrict the supply of alcohol from licensed premises and clubs and at temporary events for a period of one or more nights beginning at or after midnight and ending at or before 6 am. We are committed to ensuring that licensing authorities and enforcement agencies are given the right tools to address alcohol-related problems, and we see this as a necessary tool to enable them to have more flexibility to deal with specific problems within their areas. At the same time, we need to balance this measure by promoting a healthy night-time economy to benefit businesses and the communities that they serve. I am confident that this proposal will provide the licensing authorities with an additional tool to deliver these aims. It will be up to them to decide whether they use it at all and how they use it.
I want to prevent any concerns that EMROs applied from midnight will unfairly penalise responsible premises that regularly trade between the hours of midnight and one o’clock. Those are not quite the same as the hours that the noble Lord mentioned in respect of his small jazz club but there are premises that go on beyond midnight. I acknowledge that the majority of retailers trade responsibly. However, I say to my noble friend Lord Astor that residents and residents groups have told us that the night-time economy generates a significant amount of alcohol-related anti-social behaviour and that these problems typically surface from midnight onwards. Indeed, not all serious crime is as a result of alcohol but 15 per cent of serious crime is committed after midnight.
There will be exemptions from EMROs set centrally by the Government in secondary legislation. These will ensure that retailers who operate responsibly are not unfairly penalised by the introduction of an EMRO, and we will of course be consulting on this. For that reason, I ask my noble friend not to press that particular amendment.
May I ask my noble friend a question before she leaves that subject because I know that she has a huge number of amendments to reply to? She spoke about crime committed after midnight, which is certainly true, but does she accept that the statistics show that the majority of crime is committed much later than that—at two, three or four o’clock in the morning? Therefore, to say that midnight is the cut-off which would help that is not correct or particularly fair to those operators. Does she also accept, which is very important, that if there is a tendency by the Government and local authorities to determine that midnight will be the new relevant hour, the effect will be to put half the operators out of business, which will create a much greater problem of social disruption and crime than there is at the moment?
I understand the point that my noble friend is making but I reiterate that this is a flexible option for local authorities. They will know where the hotspots are and whether things happen on a particular night of the week. They will have the flexibility to make sure that if they intend to exercise the option—it will be optional—to introduce an EMRO, they can scale the EMRO according to the problem that presents in their locality. It does not have to start at midnight or finish at 6 am but it is between those hours that an EMRO can apply. Just on that point, because I sense that noble Lords feel that this is a draconian measure, it strengthens the licensing authorities’ powers in the sense that it gives them an additional tool in the box, but to get that balance right it has the flexibility that I hope will not create the concerns that businesses might feel, as represented today. My noble friend Lord Clement-Jones mentioned that the full council would not decide to make an EMRO. It is the case with the existing legislation, and will still be the case that the decision will be made by the full council. That has not changed at all in the updating of the legislation.
Moving on to Amendments 240PA to 240SA and the question of private clubs, I recognise the intention of noble Lords to remove private club premises certificates from the effect of an EMRO. There are, of course, clubs and clubs. I am sure that in any private club, of which noble Lords are members, propriety is observed in their proceedings, whatever the time of the day or night. I see noble Lords trying not to catch my eye on this, so they may know. It is important to note that antisocial behaviour and crime and disorder are not necessarily attributed to one premises but a cluster of premises in a concentrated area. There is no evidence to suggest that clubs do not contribute to these types of problems in the night-time economy. The Government do not want to penalise those businesses that operate responsibly and as such, if the licensing authority decides to impose an EMRO in the local area, businesses, including all clubs, will be able to make a relevant representation and provide evidence that they do not contribute to late-night crime and disorder and anti-social behaviour.
At this point, I should say to my noble friend Lord Astor, that on many occasions as a Member of Parliament I went out on Friday and Saturday nights with the police in small Devon market towns where they have perhaps one or two clubs and some late-night licences. Although I completely admire the work that the police and other agencies do at that time of night, it has not been my experience as a Member of Parliament that all anti-social behaviour, including things that are well in the frame of criminality occur after 2 am or 3 am. I was prompted to go out with the police on one occasion because between the hours of midnight and one in the morning, small shopkeepers regularly complained that their shop fronts were kicked in. I would say to my noble friend that within the scope of EMROs and the procedure to be followed in a licensing authority introducing an EMRO into the area, there will be plenty of scope for businesses to make their case, if they feel that they have one. None the less we feel that it is an important tool that licensing authorities will welcome.
From these Benches, I support the Government and the way in which the legislation has been drafted, provided that it is enacted and applied with the flexibility that the Minister is describing. I do not do so in the spirit of being too puritanical, I hope. Living in the middle of the city of Chester and observing the streets in the early hours of the morning sometimes, and indeed relating to a whole new movement of what are called street pastors when churches seek to pick up some of the consequences of late-night activities in city centres, and contrasting the average experience in this country from what you find in many continental countries and the lack of civilised behaviour comparatively in this country, the Government are on the right lines provided that there is the flexibility to project the small jazz club, or whatever. Notwithstanding the anxieties expressed elsewhere, the Government can know that from these Benches, without a shred of puritanical spirit, we support them.
I am grateful to the right reverend Prelate. I am, of course, familiar with the work of street pastors who give up their time voluntarily, particularly to ensure that people who have consumed too much alcohol are able to get home safely. I commend their work. As a new Minister with a new responsibility for alcohol and drugs policy in my portfolio, it strikes me that I need to dig deeper than looking at the solutions to late-night drinking and look at the causes of why street pastors and others are now required to carry out this valuable work. It seems that we spend a lot of time talking about the consequences. I hope that in my time as a Minister at the Home Office I can try to dig deeper than that to see whether we can do something. It is a long-time ambition, I know. Nothing will happen overnight to change this culture, as I mentioned in a previous debate on the subject. Far too many people—not just teenagers kicking over the traces—believe that they have not had a good time or a good night out unless they get absolutely paralytic. We must try to address the cause as well as deal with the consequences for the rest of the community.
We on this side welcome that statement. Throughout this debate we have been trying to engage with the question that the issues we are addressing in the Bill are but a superficial aspect, important though it may be, relative to the point that she has just made about how the cultural effects are coming forward. Does she intend to take this forward, not in her nanny mode of course—this is much more in her policy advocacy role? Will she take into account the fact that we need to look again and will return later in the Bill to the question of how drugs, alcohol, and tobacco all interact? It is not just an alcohol-only problem.
I agree with that statement. We need to look at the combination of drink and drugs. Very often the consequences are exacerbated as a result of the combination of those two substances. I am almost beginning to sound in my own head like a nanny. I do not want to sound like that; I was young in the 1960s so I do not want to sound too prissy about all of this. However it is a serious problem and I welcome the opportunity to address it.
Moving on to Amendment 240R and particularly TENs, which hopes to prevent a situation whereby a temporary event has been organised in advance and has to be cancelled because an EMRO has been imposed. I understand those concerns, but I point out that the process of making an EMRO will not take place overnight or without proper consultation. It is also important to remember that EMROs will apply only to a specific area for a set time between midnight and 6 am. Anyone planning a temporary event could therefore choose to hold it in a different part of the local authority area, or restrict their TEN to include the sale of alcohol up to but not after midnight. Therefore, there is flexibility.
Amendment 240T concerns affected persons. I acknowledge that the amendment intends to include a personal licence holder as an affected person in respect of the early-morning restriction orders. I realise that this would enable personal licence holders to make relevant representations to the licensing authority on a proposed early-morning restriction order. However, there is already a provision for personal licence holders to make a relevant representation in relation to an early-morning restriction order. Relevant representations can be made by affected persons, responsible authorities and any other person: they would not be excluded. Personal licence holders will be entitled to make a relevant representation, as any other person will, and therefore the amendment is not necessary.
Amendments 240V, 240W and 240X concern exemptions, which several noble Lords mentioned. They are important. Although the exemption categories for EMROs will be set centrally by the Government, licensing authorities will still have discretion in other areas. For example, the licensing authority will be able to decide during which hours the EMRO will apply, whether it will apply on every day or on particular days, whether it will run for a limited or unlimited period and whether it will apply to all or part of the licensing authority area. There is a lot of flexibility there to deal with problems without the regulations being too heavy to apply.
The Government intend to exempt certain notable candidates from EMROs. My noble friends Lord Clement-Jones and Lady Hamwee in particular mentioned New Year’s Eve. We are also very conscious that more royal celebrations are coming up next year that might fall into this category. It is also important to note that the Government recently held a series of EMRO working groups with key partners to discuss possible categories of exemption from EMROs. We are considering the feedback from these working groups and intend to hold a public consultation in the coming months on exemption categories and dates. I am very confident that there will be every opportunity to make sure that the nanny state does not intervene too much at times like New Year's Eve and on special national occasions.
Amendment 240RA applies to licensing authorities. They will be able to use their discretion to determine whether an EMRO will apply for a limited or an unlimited period. This will ensure that licensing authorities will be able to consider the situation in their local area. We are trying to give flexibility, but it is not just a question of flexibility: it is about targeting hotspots. If the EMRO is too broad and brings too many people into the catchment area who are not running businesses that are in any way contributing to the problems of the night-time economy, the local authority will be best placed to identify this. I am concerned that the proposal to put in the Bill a two-year time limit for an EMRO would take away that flexibility. It is important to note that licensing authorities will be able to vary or revoke an EMRO at any time that they feel it is appropriate. For example, if a licensing authority sets a time limit on an EMRO and the problem is then resolved, there is no reason why it cannot revisit it and decide to lift it. This means that, in revoking an EMRO, a licensing authority can respond very particularly when a situation in its area improves.
Amendment 240RB concerns the requirement that licensing authorities must specify a date when the EMRO will cease. Licensing authorities are required to state the commencement date of the EMRO on the order. I recognise the intention of noble Lords to add a requirement for licensing authorities to state the date on which the order will cease. Of course, the licensing authority can specify whether an EMRO will run for a limited or unlimited period and will already be able to specify the end date of an order if it runs for a limited period. However, if the authority decides to impose an EMRO for an unlimited period, clearly there would be no end date. However, it has that choice, as well as the power of revocation. The amendment would deprive licensing authorities of the flexibility and discretion that we seek to achieve in the Bill.
This has been a useful debate. There is quite a lot of common ground in all parts of the House on some of these measures, and I hope that noble Lords will feel able to withdraw the amendment.
My Lords, before that happens—and I dare say that it will—perhaps I may ask about exemptions. The Minister talked about working parties: that is all to the good. However, I am not sure that she addressed Amendment 240V, which would allow local authorities to categorise their own exemptions—but I may have missed that.
My Lords, I thank the Minister for that very thoughtful and useful response, which helpfully went through the different amendments and added quite a lot to our interpretation of what is before us. I am very grateful to my noble friend Lord Astor for his support on the amendments and on the clause stand part debate. I am also grateful to my noble friend Lady Hamwee for her support at least for the New Year's Eve exemption, and to the noble Lord, Lord Stevenson, for his support on the stand part debate.
We have quite a lot of common ground, which revolves around flexibility. What worries me somewhat is that the flexibility is all one way. I will come to the issue of the consultation process, which will be extremely important. I do not think that there are any puritans in the House. Certainly, I would not regard the right reverend Prelate as a puritan in this regard. Perhaps the noble Lord, Lord Brooke, might just qualify on this ground. I do not see where the clamour is coming from—
My Lords, we have had a useful debate about exemptions and I would certainly exempt my noble friend Lord Brooke of Sutton Mandeville from that description.
I regard this as a very important debate because of the potential impact if these provisions are not applied flexibly. I took quite a lot of comfort from the fact that this provides a range of tools, timings and geography that will be very beneficial. I certainly would not accuse the Minister of being a nanny. However, there is something of a difference in philosophy. The powers of the local authority will be pretty wide. She said that she was not favourably disposed to an amendment—
I apologise for interrupting my noble friend and hope that he will forgive me: I wish to put something on the record. I was asked by my noble friend Lady Hamwee about whether EMRO exemptions would be decided locally and I am afraid that I gave her the wrong answer. It is levies that the local licensing authority will have an opportunity to issue locally: EMROs will be a centrally decided package. I apologise for that.
My Lords, I worry that there will be no review mechanism for these EMROs unless the local authority decides that there should be. Of course, local businesses will be able to make representations both at the point that the Minister described when the EMRO is being considered, and no doubt during the course of the EMRO in terms of demonstrating that the original problem has gone away or been dealt with or whatever. However, what worries me is that there will be no mechanism that the business can rely on, at the point where the EMRO falls due for review and when the time is up, to ensure that a full and proper debate can take place.
The most important issue here is how that consultation is going to take place. I was very interested in the way in which the Minister described the process; for instance, the consultation on exemptions. I do not know whether it will be statutory guidance or whether an order will come before this House or, indeed, who would be consulted in that process. It would be extremely valuable to get from the Minister an indication, even at this point, about which cohort of people would be consulted because there are strong views about this. The real, deep worry that people have is about the potentially blanket nature of these EMROs.
My Lords, that is deeply reassuring to us lawyers, but I am afraid it is not very reassuring to the owners of businesses because they will simply have to place themselves in the hands of my colleagues and myself in challenging these orders on the grounds that no reasonable council would have imposed them. That is a very tall order.
Absolutely. That is only going to add to the burdens on business. Although I accept that the Minister has gone as far as her brief will allow her, I seriously ask her to give further consideration to this. I was delighted to hear what the noble Lord, Lord Stevenson, had to say about his enthusiasm for live music, but the reason why he was talking about it was the potential impact on small venues and live music in areas where local councils have decided that they do not like what is happening in other places—not necessarily in the small clubs but in the large boozers, so to speak. That is sweeping up everybody into one single pot with one remedy. Although I have heard quite a lot today from the Minister that was reassuring about the ability to deliver flexibility, I do not think we have heard quite enough yet. The least convincing response was on TENs. If you have a TEN, and an EMRO is opposed, you can have a bit of a consultation on it, but actually the remedy is to move your event in time or space. That seems pretty onerous and jolly unfair if you are a local community group and you have to shift yourself in that way after an EMRO has been imposed.
I look forward to further dialogue with the Minister and very much hope that we will continue that, even before Report, on certain areas of these reforms of the Licensing Act. In the mean time, I beg leave to withdraw the amendment.
Amendment 240PA withdrawn.
Amendments 240PB to 240RC not moved.
Amendment 240S had been withdrawn from the Marshalled List.
Amendments 240SA to 240X not moved.
Clause 120 agreed.
Clause 121 : Suspension of licence or certificate for failing to pay annual fee
Amendment 240Y had been withdrawn from the Marshalled List.
240Z: Clause 121, page 82, line 35, leave out from beginning to end of line 2 on page 83
My Lords, this takes us to the clause on fees and non-payment. I shall speak also to Amendments 240XB, 240XC, 240XD, 240XE and 240XG. These amendments are anti central prescription and pro local discretion. In many places, the Bill seems not only very prescriptive but unnecessarily prescriptive. For instance, it mandates the issuing of a receipt in a specific format in a set timescale. Is that really necessary? The word “nanny” was used, and rightly denied, but at this point, it would be an appropriate accusation. Other fee-paying regimes work out how to deal with these peripheral matters. We have a lot of legislation. This alone is a big Bill, but did it need to contain all this? At the most, it could be a matter for guidance, although I do not think that that should be required either. The Government are seeking to reduce regulatory burdens. This seems to be adding to them.
I shall be very brief on the detail of the amendments. Amendment 240Z would take out the provision for written acknowledgement of receipt of the fee—I cannot believe that that will not be done because people paying money require receipts—and the time periods to which I referred. Amendments 240XC and 240XD increase the grace period. Again, is this prescription absolutely necessary? The grace period is 21 days in the Bill, but I have suggested eight weeks. It is fairly obvious that I oppose my noble friend’s amendment in this group, Amendment 240XH. That follows from what I have just said. I support Amendment 241ZB, to which I think the noble Lord, Lord Stevenson, will speak. I am very glad that the Local Government Association spotted what, coming up to Wimbledon, I can perhaps describe as an unforced error in the legislation. I beg to move.
My Lords, I welcome what the noble Baroness, Lady Hamwee, said and support her amendments. The provisions in the Bill are very detailed and our amendments, taken together, are an attempt to try to tidy up some of that and to reflect on the regulatory burden that is being imposed.
I shall speak to Amendment 241ZB, which has been mentioned. Someone spotted what appears to be a simple error: at present, it does not look as though the costs incurred by some parts of the licensing system can be recovered, particularly in two-tier areas. As is well known, when a licensing application is made, copies of the licence are sent to those parts of the council classified as responsible authorities under the Licensing Act. In unitary authorities, including London boroughs, metropolitan councils and Welsh councils, all those bodies exist within the same council, which is also the licensing authority. Therefore, the costs would be recoverable under Clause 122 as presently drafted. However, in two-tier areas, the licensing authority sits within the district council, whereas social services and trading standards sit at the county level. As a result, in two-tier areas, the costs incurred by social services and trading standards would not be recoverable should the clause remain unchanged. Our amendment is therefore imperative to ensure that all costs are recoverable, regardless of the local government structure in the area, thus fulfilling the commendable approach which has been taken in the Bill to allow full cost recovery through licence fees.
My Lords, I should like to speak to Amendments 240XF, 240XH and 241ZZA, while supporting Amendments 241 and 241Y. These amendments seek to remove the lines of the Bill which give councils the power to charge licensees for more than just cost recovery in the licensing system. Businesses in the sector are concerned about the cost implications of the amendment in the other place on fees. In already difficult economic times, licensees will be facing significantly increased costs, which will be particularly difficult to bear for small businesses.
The wording of the Bill is extremely vague, stating that businesses will not only be liable for costs associated with local authorities discharging the licensing function but also the general costs of the licensing authority and other associated authorities, such as the planning department. These amendments seek to delete the provision that would allow licensing authorities to reclaim not only the cost of carrying out activities relating to licensing but also any other general costs. This wording would effectively give local authorities power to charge licensees for a whole host of alternative activities even if they are not related to the cost of administering the licensing regime.
The legislation does not explain what safeguards will be in place for businesses. There has to be a transparent process where local authorities would need to demonstrate why their chosen fee level is appropriate. Businesses would have to have an opportunity to feed into this process and to appeal the decision if the local authority was looking to set fees at a level that was disproportionate. There should also be a national cap on the level at which fees can be set to avoid local authorities applying disproportionate charges.
While the measure would have a significant impact for all premises, there is the concern that it could disproportionately affect smaller businesses. It could be the case in certain areas of particularly high licensing fees that independent businesses find themselves priced out of the local market and therefore unable to compete with larger chains. That would be to the detriment of the consumer who would find that their choice is limited. With reference to the off-trade, a significant number of licensed premises are grocery retailers, so this decrease in competition locally would impact on far more than just the ability to buy alcohol. Any increase must consider the effect on smaller businesses.
Amendment 240XH is designed to ascertain the Government’s intention on the introduction of a cap of the amount that local authorities can charge. Subsection (3) of the new clause to be inserted in the Licensing Act 2003 under Clause 122(2) provides,
“the fee is to be determined by the licensing authority to whom it is to be payable”.
Subsection (4) of the new clause allows the regulations to provide a constraint on the amount up to which local authorities can charge but this does not necessarily mean that such a limit must be set. Businesses have a real concern that some councils may charge excessive amounts based on their costs, which will be difficult and expensive to challenge. We know already that the level of enforcement activity varies around the country and such variation is not necessarily driven by need. Not all councils are driven by the Hampton principles of good enforcement and over-zealous enforcement can be expensive and unproductive. The wide range of fees collected by councils under the old public entertainment licence regime was one of the drivers of their being subsumed into the Licensing Act 2003. A repeat of the problems, discrepancies and costs to businesses should not be repeated. A national cap, such as that imposed in the Gambling Act 2005, is a not unreasonable request and should be specifically included in the Bill.
Amendment 241ZZA builds on previous amendments to ensure that safeguards are in place in the legislation to prevent businesses facing excessive and unfair licensing fees.
Amendment 241, to which my noble friend Lord Clement-Jones referred, is in my name and concerns fees. Subsection (7) of the new clause to be inserted in the Licensing Act under Clause 122(2) states:
“In determining the amount of the fee, the licensing authority must seek to secure that the income from fees of that kind will equate, as nearly as possible, to the aggregate”.
Paragraph (a) of subsection (7) states that,
“the licensing authority’s costs referable to the discharge of the function to which the fee relates”.
I do not see any problem with that clause, which seems enormously sensible and would collect most of the costs. However, paragraph (b) of subsection (7) refers to,
“a reasonable share of the licensing authority’s general costs”.
That seems to be a recipe for confusion because there will be endless arguments about, first, what is a reasonable share and, secondly, what are the licensing authority’s general costs. I thought that when local government—there are many noble Lords here who are more expert than I am on it—determined fees and collected them, those fees related to the actual things that it was doing. The idea that this can cover general costs, as my noble friend says, would enable a local authority to say that general costs in many other areas—whether for collecting refuse or whatever—could somehow relate to this and then collect the fees. So there is a concern.
I hope that my noble friend can give me some comfort that this will not allow local authorities, which, as we know, are always short of money, to use this to collect fees, which would mean a greater burden on the industry than there should be. [Interruption.]
My rising is not normally greeted with that amount of drama and my observations will not in any way warrant that dramatic attention. As a footnote to what my noble friend Lord Astor said, it seems that a local authority in assessing its costs in terms of this process will have both fixed costs and marginal costs. Although I totally understand that he is arguing for marginal costs, there presumably has to be some way in which the fixed costs are recovered as well.
I do not think that the Minister needs to apologise to the House for the line that she is taking. If I could catch her attention, I would congratulate her on being very bold. Perhaps I will be accused of being a Puritan today. I will come back to the noble Lord, Lord Clement-Jones, in a moment and try to prove to him that I am not. In Committee, I was invited by the noble Lord, Lord De Mauley, to raise questions I had raised previously about the Government’s philosophical approach to licensing and whether we are effecting a change of direction to what we have had during the past 15 years. I will not repeat them all. They are on the record and I do not suppose that at this time we have enough time to go into a philosophical discourse on it.
I hope that the Government are about a subtle change over time that will lead, one hopes, to a cultural change over time. It will not be easy, as the Minister rightly acknowledges. A good change that the Government have effected is that they are now prepared to allow local authorities at least to start recovering some of the costs that they have been incurring and have not been able to recover in recent years because of the failure on the part of government to allow them to update their recovery elements. There are some technical points and I support the amendments in the names of the noble Baroness, Lady Hamwee, and my noble friend Lord Stevenson.
As he might have anticipated, I am opposed to Amendments 240XF, 240XH and 241 in the name of the noble Lord, Lord Clement-Jones, which would move us back to the status quo and not go down the route which the Government are endeavouring to traverse. I can tell the noble Lord that I would be quite happy to support Amendment 241ZZA, which seeks greater openness and transparency in the way in which local authorities are working out and charging their fees. I would hope that, in drawing up a list and in giving guidance to local authorities, we might be prepared to give them the freedom to recover the costs that they might incur in trying to retrain some of their licensing authorities on how they should deal with the thorny issue that the Minister endeavoured to tackle in our previous session on the differences between the words “appropriate” and “necessary”.
I have been in touch with the LGA and, as the noble Lord, Lord Clement-Jones, has said, it is unhappy about this—not for political reasons but primarily for technical reasons. There would be a problem for the panels in dealing with the change in language without being given appropriate training in order to be able to handle it, but it fears it could not meet the costs. So I hope that the Minister will give favourable consideration to adopting Amendment 241ZZA and perhaps add to the list the training costs incurred by local authorities in seeking to implement fully the changes the Government are endeavouring to introduce in the legislation relating to fees.
I try to be balanced in my approach. Overall, the direction is correct but perhaps some changes need to be made here and there. I am therefore happy to support the noble Lord, Lord Clement-Jones, in his Amendment 241ZZA.
My Lords, I start by thanking all noble Lords for their thoughtful and constructive comments in connection with these clauses and amendments.
Clauses 121 and 122 address problems in the system of fees under the Licensing Act 2003. Local government has been calling for action on both these points ever since the Act was introduced. Clause 121 introduces the suspension of licences or club premises certificates for failure to pay the annual fee. Currently, an authority must pursue unpaid annual fees through the courts, and there is no other sanction for non-payment. The sanction of suspension will provide a considerable added incentive to licence holders to pay the fee on time. Clause 122 introduces locally set licensing fees. The purpose is to ensure that licensing fees properly recover the cost to licensing authorities of discharging their functions under the Act. Although this clause was introduced on Report in another place, it was not a decision taken in haste. We needed time to ensure that the clause achieved full cost recovery for licensing authorities in a way that is fair to fee payers, licensing authorities and council tax payers.
There are a number of amendments in this group, and I hope noble Lords will bear with me as I attempt to give each amendment the response it deserves. Amendments 240Z and 240XC would remove the requirement on local licensing authorities to provide a receipt. Amendment 240XA aims to reduce the burden of the requirement by requiring that the receipt must be provided only if it is requested. I recognise that these amendments aim to reduce what may look like excessive bureaucracy. At the outset, it is worth emphasising that the clause requires the provision of a receipt only in a case in which a licence or certificate has been suspended and is then reinstated when the fee is paid. We do not expect this to be a frequent occurrence, as we expect licence payers to be assiduous in avoiding suspension. It is not unreasonable for the licence holder to expect clarity as to whether the licence has been reinstated because carrying out licensable activities without a licence is a serious offence. The maximum penalty on summary conviction is six months’ imprisonment, a fine of up to £20,000, or both. Amendment 240XA is a compromise solution whereby licensing authorities will be required to provide a receipt only on request. Having considered it, I believe that this amendment would actually increase the bureaucratic process in terms of the correspondence relating to whether or not a receipt is required, with, I suggest, only marginal benefit.
Amendments 240XB and 240XD would greatly extend the grace period that applies in cases of dispute or administrative error. The period of 21 days is not set in stone as a matter of principle. However, three weeks seems to us a reasonable length of time in which to resolve a dispute or administrative error. It would allow evidence to be provided that the fee has already been paid or that the supposed due date was not the anniversary of the licence. I cannot yet see a case for extending this period by five more weeks, and I would be concerned that it would considerably weaken the sanction of suspension.
Amendments 240XE and 240XG remove references in Clause 121 to the Secretary of State’s powers to prescribe fees. I understand absolutely that the intention is to emphasise the Bill’s contribution to the localism agenda. However, the references which the amendments seek to remove are cross-references to the existing powers to set fees centrally. They are a necessary part of the mechanism by which Clause 122 introduces a power for the Secretary of State to provide that fees are set locally. So the result of the amendments would actually be that the clause no longer provides for locally set fees.
Amendments 240XF and 241 would remove the reference to the licensing authority’s general costs from the description of what fees must cover. I emphasise that there is no intention that locally set licensing fees will fund the general costs of local government in the everyday sense of the phrase, which means that they could raise money from fee payers for something unrelated, such as to help build a new swimming pool or, as my noble friend Lord Astor suggested, to collect refuse. That would mean that licensing fees had become a form of discretionary local taxation. This is certainly not permitted by Clause 122 through the insertion of Section 197B of the Licensing Act, specifically subsection (3), which defines general costs and limits them to costs referable to the discharge of functions under the 2003 Act.
Amendment 241ZA also seeks to reduce the costs that can be recovered by licensing authorities through locally set fees. In this case, it seeks to remove the costs incurred by the licensing authority under the Act, but in a capacity other than that of a licensing authority. The costs referred to are those of the responsible authorities that are part of the licensing authority. These costs were intended to be taken into account by the current centrally set fees. Not to permit these costs to be covered by locally set fees would be to impose a new burden on local government and would therefore be contrary to established government practice and the intention of the clause. Our intention in introducing locally set licensing fees is that they should cover the cost to licensing authorities of discharging their functions under the 2003 Act. The current fees, set centrally, were also intended to cover the general costs as they are defined in this clause, and the defined costs of a licensing authority acting as a responsible authority. To remove these costs would mean that fees did not achieve what they are supposed to do.
Amendments 240XH and 241ZZA seek to ensure that the power to set fees locally is constrained and subject to guidance. I can assure your Lordships that we do indeed intend to make locally set fees subject to constraints. Specifically, we intend to make each fee subject to a nationally set cap, and we will consult on the level of that cap. However, to impose a requirement for the imposition of unspecified constraints would be both excessive and, I suggest, ineffective. A future Secretary of State may, for example, have a legitimate reason to utilise the power to make different provision in respect of different authorities, or not to impose additional constraints on a particular authority. However, it must be remembered that such an authority would still be subject to the limitation that income from fees equates as nearly as possible to costs.
Amendment 241ZZA introduces a duty on the Secretary of State, when providing for locally set fees, to issue detailed guidance. Again, I can assure your Lordships that it is our intention, after consultation, to issue guidance covering all these points. However, I suggest that it is excessive to require all these specifically in the clause. Section 182 of the 2003 Act already requires the Secretary of State to issue guidance to licensing authorities on the discharge of their functions under the Act. It also enables her to make such revisions to the guidance as she considers appropriate. The addition of a new duty, that of setting fees, would therefore justify such a revision, and it is our intention to do so.
Amendment 241ZB seeks to ensure that the costs of social services and trading standards, in their roles as responsible authorities, can be taken into account within locally set fees even when they are located in an upper tier authority. Currently, the clause has the effect that these costs are recoverable only in a single tier authority, such as a unitary authority. I thank noble Lords for drawing attention to this. I know that many noble Lords will be concerned about the addition of any further costs that will be recovered by fees.
It should be noted that the amendment specifies that the costs that should be recovered are those of these two public bodies, but only in their roles as responsible authorities: for example, in considering applications and, in rare cases, applying for a review. This is expected to be a very marginal cost in the context of overall fee income. It does not incorporate the wider costs of these public bodies in dealing with licensed premises. We intend that locally set fees should cover costs that are not covered by the current centrally set fee levels. For example, the costs of the environmental health authority in respect of its wider statutory duties connected to licensed premises are not covered; only the marginal costs that arise from the 2003 Act are. Having said all that, I see sense in the intention of Amendment 241ZB and, if I may, I shall reflect on it further.
Amendment 241Y seeks to remove the provision in the Bill for regulations to be made providing that club premises certificate holders can make a free minor variation before a late-night levy is introduced in their area. It is consequential on a number of amendments that have the combined effect of removing members’ clubs from the application of the late-night levy. I hope that we will be able to discuss it later, alongside those amendments. For the reasons that I have given, I therefore ask that noble Lords do not press their amendments today.
My Lords, briefly, before my noble friend replies on her amendment, I welcome the Minister’s useful clarification of the definition of general costs. I shall certainly reflect on that before the next stage. The technical references were extremely helpful. The Minister was also very helpful in talking about the guidance on how fees are calculated and will be dealt with by local authorities.
I welcome the support of the noble Lord, Lord Brooke, for my amendment. It was like the first swallow of summer or something of that sort. On my Amendment 241ZZA, the Minister said that guidance will be published, which is helpful. However, as far as one can see there is no appeal mechanism in the proposed new section that is already incorporated in the Bill. Is it possible for guidance to deal with how that sort of thing should be dealt with as well?
My Lords, I am glad to hear that the Government will reflect on Amendment 241ZB. I am grateful to my noble friend for responding to a couple of amendments that I failed to explain. I have been a little distracted by a domestic crisis. One should not use a BlackBerry too much in the Chamber, but it has been jolly useful this morning.
If the receipt is intended as an acknowledgement that the suspension has ended, it seems rather a confusing mechanism. Simply providing that the authority must acknowledge that the suspension has ended would be a great deal clearer.
I shall say just a word about the general costs. There is a reference to a cap. I am puzzled by how a cap can be consistent when the fees must reflect actual costs. Perhaps we can pursue that outside the Chamber.
I shall also put one thought into the Government’s mind. The references to general costs seem very wide. I am not surprised that they have attracted amendments. They are justifiable if they are a proper proportion of overheads. I wonder whether some wording such as “directly or indirectly related to the particular application” might be more reassuring and appropriate. Although some of us are approaching this from different points of view, we might be able to share some thoughts before the next stage. I beg leave to withdraw Amendment 240Z.
Amendment 240Z withdrawn.
Amendments 240XA to 240XD not moved.
Clause 121 agreed.
Clause 122 : Power for licensing authorities to set fees
Amendments 240XE to 241ZB not moved.
Clause 122 agreed.
House resumed. Committee to begin again not before 2.46 pm.