House of Lords
Monday, 2 July 2012.
Prayers—read by the Lord Bishop of Lichfield.
Civil Service: Training and Development
To ask Her Majesty’s Government, in the light of reductions in Civil Service numbers and training budgets, and the closure of the National School of Government, what steps they are taking to ensure that civil servants receive the necessary training and development to provide high-quality policy advice to Ministers.
My Lords, as the House will be aware, we published the Civil Service reform plan on 19 June, which set out recommendations on training and development, among other proposals. Civil Service Learning is now in place to provide greater choice, flexibility, quality and value for money. It ensures that the current and future skills requirements of civil servants are met. Civil servants can access more than 130 e-learning resources, 75 classroom-based courses and 4,000 learning resources through the Civil Service Learning website. The new policy curriculum is also available through Civil Service Learning. It provides a comprehensive range of policy training and was developed in consultation with people currently working on policy and with subject matter experts in specific policy areas.
I thank the Minister for his helpful reply. Given that these reforms are coming at a time when the Civil Service is reducing in size by some 23%, thereby putting a premium on sharper and more agile policy advice, which as the reform plan itself says should be clearly based on “robust evidence”, will the Minister explain what evidence exists to show that opening up the policy development process to external competition, including from the private sector, will lead to higher quality, more cost-effective and, above all, impartial policy advice?
My Lords, it is not entirely the case that all Civil Service training was provided by the public sector before this. The evidence is to be found in particular in the rather critical NAO report of last year. Among other things, it quotes the Civil Service people survey of 2010, which said that,
“only 48 per cent of civil servants said that the learning and development they had received in the last 12 months had helped them to be better at their job”.
A lot in the NAO report was critical of the inefficient and divided provision of training, particularly between different departments. It discovered among other things that the cost of comparable courses in different departments varied by a factor of four.
My Lords, do we not have to be extremely careful in going down this kind of path? We have a first-class Civil Service that is actually the envy of the rest of the world. Certainly, when I was a special adviser, although I had my disagreements, they were disagreements at a level that enabled me to appreciate both the integrity of civil servants and how excellent they are. Are we not in danger of undermining the Civil Service with this kind of approach, rather than appreciating the excellent people who work for us?
My Lords, I would have loved to have met the noble Lord when he was a special adviser to observe his skills. We are working with Ashridge, Roffey Park, Westminster Explained and a number of other providers. As we have been working with them, we do not see that this in any sense endangers the impartiality or quality of the Civil Service. Roffey Park, as noble Lords know, is a non-profit making organisation that provides top-class skills. We think that there are advantages in having central control of the Civil Service buy-in, which is Civil Service Learning, but with a variety of provision by a variety of providers.
My Lords, the National School of Government provided extensive residential accommodation for extensive residential courses. The Civil Service and other providers are moving away from extensive residential courses to shorter ones, very often for one day each. It is intended that the different mix will be better met and more efficiently provided by a range of different providers.
It is not the key driver, but it is one factor. The National Audit Office report’s discovery led from the next generation human resources proposals of 2009, so we are talking about some continuity from one Government to another. The discovery that the provision across different departments was so remarkably unco-ordinated and could be provided much more cheaply should naturally be taken into account by any Government—the previous one or this.
My Lords, I warmly welcome these reforms. I declare an interest as a former Civil Service Minister and underpin the remarks that have been made. Does the Minister appreciate the importance of recognising the integrity, independence and impartiality of our Civil Service, while embracing the need for further education and training?
My Lords, I am very happy to put on the record yet again our deep commitment to a high-quality and impartial Civil Service. I remind everyone that the challenges to the Civil Service at the moment—the data revolution and a whole set of new ways of working—are such that we need to look on a regular basis at the balance of training provided and the way in which one may necessarily have to change to adjust to different circumstances.
My Lords, I am tempted to ask whether the Government are now training civil servants to deal with ministerial U-turns, but I will not. I have a serious question. Last week, the Prime Minister set out a new programme of welfare reform: not for this Government, but for after the next general election. Will civil servants now be working on that policy agenda and preparing policy advice for the ideas set out by the Prime Minister?
My Lords, what is being done to ensure that civil servants communicate in plain, concise English? Will he arrange for all civil servants to be given a copy of Sir Ernest Gower’s classic work, The Complete Plain Words, so that they write and speak English and we get rid of the appalling jargon that disfigures so many public documents?
I thought that the noble Lord was going to pay attention to Civil Service spelling mistakes. Perhaps I should inform the House that I discovered some rather bad spelling mistakes in Hansard last week, which I have reported to the Hansard writers.
My Lords, perhaps the Minister could answer the question put by my noble friend on the Front Bench. Is the Civil Service now being asked to work on the welfare reforms spelt out by the Prime Minister the other day? It is a simple question.
National Offender Management Service: Indeterminate Sentences
My Lords, the role of the indeterminate sentence prisoners co-ordination group is not to prepare individual release plans. It is for the prisoner’s offender supervisor and offender manager to draw up a sentence plan to assess the prisoner’s risk factors and then to propose a risk management plan to the Parole Board once the prisoner has completed his tariff.
My Lords, I thank the Minister for that reply. The problem is that 6,500 prisoners are serving indeterminate sentences, with 3,500 over their tariff and 311 more than four years over it. The problem was put into sharp relief last week at an inquest in south Wales into the death of an indeterminate sentence prisoner who was a year over his tariff. Two weeks before he took his own life he was told at the prison to which he had just been moved that not only was the course that the Parole Board required him to complete before release not available in that prison, he was told that no such course would be available for two to three years. This problem needs to be tackled with urgency. Whether I have the name of the board right or not, I hope that the Minister will be able to assure the House that someone in NOMS is tackling individual problems with urgency.
As I explained in my original reply, there is an individual case manager for each prisoner. However, I understand the noble Lord’s point. One of the original criticisms of this method of sentencing was that it created a Catch-22 whereby although you have to carry out a range of courses in order to make yourself available for parole and to convince the Parole Board that you are ready for release, those courses are not always available. Part of the reform programme that we have put in place, in parallel to the changes in the LASPO Act, is to try to make sure that prisoners are able to undertake reform training, and also to give the Parole Board greater flexibility in making its judgments on whether other aspects, rather than specific training programmes, can be taken into account in order to justify freedom. It is a difficult and delicate business. We are dealing with people who are in prison for serious offences and there must be a proper process to assess whether they should be allowed to go back into the community.
My Lords, the Government were right to abolish IPP sentences—they were bad for the criminal justice system and bad for the prisons. As has been said, more than 6,000 inmates are currently in our prisons under IPP. If there is such a considerable delay in providing offender reform courses for inmates, could not the Prison Service use volunteers to help deal with it? Many prisoners also often find that despite assurances from the Parole Board about open conditions and release, the Prison Service is not meeting those assurances.
That is why, in answering the noble Lord, Lord Ramsbotham, I referred to the fact that the Parole Board can now take into account other aspects of prisoner activity that might contribute to the assessment of whether prisoners can be safely released. We are also making sure that there is much more co-ordination of the policy so that there is an understanding in the various prisons of what is available and so that much greater use is made of compulsory intervention plans. However, it is a difficult problem. As the noble Lord, Lord Ramsbotham, said, there is a build-up of more than 6,500 prisoners on IPP sentences, and it will take time to unwind the system. We are unwinding it, and more prisoners are being released after proper assessment. However, we cannot simply release prisoners who have received such a sentence because of the severity of their crime or the assessment that they are a long-term danger to the public.
My Lords, the noble Lord has clearly taken on board that this is a very serious question for those who are beyond their tariff. Can he give any indication of when the Parole Board is likely to see them? Can he suggest whether there is not some way that those who have committed less serious crimes could be released by some form of executive action?
The LASPO Act provides for the possibility of executive action on this matter and for a change in the balance of judgment to be made by the Parole Board. For the moment the Government are waiting to see the impact on overall numbers of the new systems that we have put in place. About twice as many IPP prisoners are being released now than were released two years ago, but we are also facing the problem that judges are still imposing IPPs. I believe that we will have the first net reduction this year, with more people being released than are coming in under the new system. We hope to be able to announce later this year when the new sentencing system included in the LASPO Act will be introduced.
Transport: Road Traffic
My Lords, the Government provide funding and guidance to local authorities to support them in managing congestion on the local road network, including reducing the impact of roadworks. We have made better regulations to allow pioneer lane-rental schemes, are consulting on plans for roadworks permit schemes, and are increasing roadworks overrun charges. On the strategic road network, measures are being introduced to shorten the length of time that motorways are closed following incidents.
I thank the noble Earl for that very useful Answer. However, the improvement of road traffic is much limited by more than 90% of all passenger transport. When there are rounds of crossroads, they reduce crashes by more than 50%, and stop signs at intersections have also reduced crashes dramatically by more than 50%. The other means that the noble Earl has put forward are very useful, but can he suggest how we are going to handle all these problems?
My Lords, I did not quite catch the proposal that the noble Lord was making. I think that he was talking about roundabouts as a means of reducing accidents. Roundabouts indeed reduce accidents because the collisions are less brutal and therefore any injuries are less serious, but they increase congestion a bit because the throughput is not as high as with a grade separated junction, which is even safer. In my initial Answer I talked about a range of measures to reduce congestion, which I know can be infuriating for all motorists.
My Lords, can my noble friend persuade more boroughs to use lane rental than are currently doing so? Some are good at using lane rental; others are very limited in using it. In the past it has been a good way of speeding up repairs, thus reducing road congestion. Some activity needs to be taken with individual boroughs.
My Lords, my noble friend makes a good point. Through the Traffic Management Act 2004, all local authorities have a “network management duty” to secure,
“the expeditious movement of traffic”,
including pedestrians, on their highway network, and to facilitate the same on the networks of other authorities. Local authorities are required to appoint a traffic manager to oversee this obligation and must monitor their own performance, but my noble friend will understand that we also have the spirit of localism.
Does the Minister agree that the Technology Strategy Board has made a wise decision in assigning one of the new catapults to transport? One of the main aims of that catapult will be to develop a comprehensive, UK-wide model for transport that will operate in real time and be able to react to emergency situations. I declare my interest as chair of the Transport Knowledge Transfer Network that led to this proposal.
My Lords, the noble Lord makes an important point about what we can achieve with technology. It is particularly important for the Highways Agency to be able to measure where congestion is and then to use its variable message signs to advise motorists to seek another route. In addition, although satnav navigation systems are in their infancy, we are starting to get the full benefit from them.
My Lords, is the Minister aware that during this past year the Mayor of London has pursued a smoothing traffic flow priority, which prioritises motorists over safety? Is he further aware that pedestrian deaths are up by 33% during this period and cyclist deaths by more than 21%? I express the hope that, in answering this question, the Minister’s brief will be more secure than it was last week when he answered a question of mine on fares to and from the Scilly Isles.
My Lords, I am confident about the accuracy of this brief, but regret that during our discussions last Monday I stated that the return fare on the “Scillonian III” for Scilly Isles residents was £20.50. However, this is in fact the single fare and there may be other qualifications. I am very sorry about this, since it made my position appear stronger than it really was, to the detriment of the noble Lord’s.
The noble Lord asked me detailed questions about the management of traffic in London. He will appreciate that that is a matter for the mayor. It is disappointing that overall fatalities have increased slightly, the reasons for which we have not yet examined fully.
Part 6 of the Traffic Management Act 2004, to which the Minister has referred, gives local authorities powers to manage traffic—for example, yellow box junctions and right turns—which they can enforce through their own staff. However, is the Minister aware that the regulations have never been extended outside London? He should take it from me that bus services would be immeasurably improved if local authorities could discipline people who block the highway.
My Lords, during this Question Time, we have heard reference to catapults and lane rentals. I am aware of the injunction that we heard from the noble Lord, Lord Cormack, for us to use plain, simple English. Can somebody please advise us what a catapult and a lane rental are?
My Lords, is my noble friend aware that, while the British public have been content to face disruption due to the jubilee and are perhaps slightly less content about disruption due to the Olympic Games, they would find it intolerable to have the whole of central London brought to a standstill, perhaps for several weeks in preparation and afterwards, for a grand prix to be held?
My Lords, I anticipated an Olympics question. My first advice to all users of transport is to visit http://www.getaheadofthegames.com, which provides extremely good advice on how to avoid congestion. It is inevitable that there will be some congestion if we are to have a successful Games.
NHS: Definition of Exceptional Case
My Lords, the department has not issued definitive guidance on this difficult issue. Indeed, there is a paradox in the whole concept of defining an exception. However, good practice in the NHS suggests that a patient can be considered for treatment which is not normally provided locally if the patient has exceptional clinical need or is likely to derive exceptional clinical benefit. The decision is made by the local commissioner.
My Lords, I thank the noble Earl for that reply. However, is he aware that there is a young doctor in Northallerton, North Yorkshire, whose PCT has denied her a vital operation for a genetic pancreatic condition? If she does not have this operation, she will remain in excruciating pain all the time, she will not be able to work, and there will be a risk of cancer.
My Lords, I hasten to reassure the noble Baroness that I have every sympathy with the individual in question, and I was aware of this particular case. The chief executive of the NHS will shortly be writing to her clinical tutor to suggest a possible way forward. However, I should put on record my view that the commissioner is acting reasonably in insisting that its decision on exceptionality should depend solely on the clinical need of the patient, and not on any broader social factors. If there is now good clinical evidence to support the use of this particular treatment, commissioners should be considering whether to make it available to all patients with similar clinical needs, and not just to a few individuals.
Is my noble friend aware that the pancreatic unit at Leicester is not able to do any islet cell transplantation operations because the PCT refuses to fund them? The excuses used to justify not funding these operations are that these may be “procedures of limited value” and “experimental surgery”. There are, in fact, four clinical units throughout the UK doing islet cell transplantation, with good records and good outcomes. I want to know whether the PCTs are not funding these operations in order to present a clean sheet to the incoming CCGs in April 2013, or whether there is another reason.
My Lords, no, that is not the reason. My noble friend is quite right that this treatment has been around for a little while. However, it is not yet in mainstream practice. It is expensive, it is not routinely available in the NHS, and indeed NICE has published interventional procedure guidance which concludes that it,
“shows some short term efficacy, although most patients require insulin therapy in the long term”.
That does not seem to me to be a resounding endorsement of this treatment.
There is no clear-cut answer to that question. A patient might be suffering unusually severe symptoms from a given condition, or they might suffer from some comorbidity, with the result that in the absence of treatment his or her quality of life would be unusually severely affected. The underlying principle should be that the patient has some exceptional characteristic which would justify more favourable treatment being given to them than to the average patient with that condition.
Given the vulnerability of the patients, the exceptional nature of the illness in such cases, and the consequential problems in terms of access and capacity to appeal, will the Minister tell the House what arrangements exist to scrutinise the fairness and consistency of decisions by PCTs and by their exceptional cases review processes?
My Lords, under the NHS Constitution, all patients have the right to an individual review of a decision not to fund a particular treatment if they and their doctor believe that it would be appropriate. They also have the right to an explanation of the basis of the decision. The commissioner must in turn have a process to enable such individual funding requests to be considered, so the watchwords here are transparency and publishing an explanation.
Does the Minister agree that there are other decision-making bodies? I refer in particular to the UK National Screening Committee. Is he aware that, probably correctly, it makes its decisions only on research results? Why does it claim that it does not have the money to spend on research into Streptococcus B infections, when international research shows a clear choice for screening as opposed to risk assessment? That change that has been made in other countries has resulted in reductions of strep B infections in children of 80% in the USA, 60% in Spain, 82% in Australia and 71% in France. The screening of pregnant mothers could prevent that very serious condition, which can be fatal, being passed to a small number of babies.
My Lords, the UK National Screening Committee advises Ministers and the National Health Service in all four UK countries on all aspects of screening policy, including for group B Streptococcus carriage in pregnancy. The committee is currently reviewing the evidence for screening for that condition in pregnancy against its criteria. It will take into account the international evidence and a public consultation on the screening review will be opening shortly.
My Lords, the Minister said that this treatment is not routinely carried out. The doctor concerned, who works in the NHS, is aware that pancreatectomy is carried out in other PCTs. Can the noble Earl explain where it is being carried out so that we can understand what is routine and what is not?
My Lords, I hope that my earlier answers gave a clear indication of the definition of exceptionality, which should demonstrate to the House that something that is exceptional is not routine. Our advice is that that treatment is not routinely available in the NHS. There is a handful of centres in England with doctors who are trained to carry out the operation, but although the technique has been in use since 1977, it is available only in a few centres worldwide, which does not suggest to me that other countries are ahead of us in this area.
Delegated Powers and Regulatory Reform Committee
Can the Chairman of Committees give us a clear assurance that the removal of the noble Lord, Lord Carlile, from this important committee is not connected in any way with his excellent article in the Telegraph describing Mr Clegg’s House of Lords reform proposals as third rate?
Northern Ireland Act 1998 (Devolution of Policing and Justice Functions) Order 2012
Motion to Refer to Grand Committee
I would like to point out to those who are concerned with the future of this place that we have on the Order Paper today a number of things, each one of which could be debated at length. However, because we are such a restrained, responsible House, we shall not be debating them at length, but an elected Chamber at odds with the other place might well choose to do so.
Rehabilitation of Offenders Act 1974 (Exceptions) (Amendment) (England and Wales) Order 2012
Data Protection (Processing of Sensitive Personal Data) Order 2012
Public Bodies (Abolition of Her Majesty’s Inspectorate of Courts Administration and the Public Guardian Board) Order 2012
Public Bodies (Abolition of Crown Court Rule Committee and Magistrates’ Courts Rule Committee) Order 2012
Motions to Refer to Grand Committee
Local Authorities (Mayoral Elections) (England and Wales) (Amendment) Regulations 2012
Motion to Refer to Grand Committee
Electoral Registration Data Schemes Order 2012
Motion to Approve
Statutory Auditors (Amendment of Companies Act 2006 and Delegation of Functions etc.) Order 2012
Motion to Approve
Crime and Courts Bill [HL]
Committee (5th Day)
Relevant documents: 2nd Report from the Delegated Powers Committee, 2nd Report from the Constitution Committee.
135: After Clause 19, insert the following new Clause—
“Transfer of immigration or nationality judicial review applications
(1) In section 31A of the Senior Courts Act 1981 (transfer from the High Court to the Upper Tribunal)—
(a) in subsection (2), for “, 3 and 4” substitute “and 3”,(b) omit subsection (2A),(c) in subsection (3), for “, 2 and 4” substitute “and 2”, and(d) omit subsections (7) and (8).(2) In consequence of the amendments made by subsection (1), section 53(1) of the Borders, Citizenship and Immigration Act 2009 is repealed.”
My Lords, this amendment will remove restrictions contained in Section 31A of the Senior Courts Act 1981. It will enable applications for or permission to seek judicial review in immigration, asylum and nationality cases to be transferred from the High Court in England and Wales to the Upper Tribunal.
As noble Lords will be aware, this House has considered this issue before. In 2009, the House thought it appropriate to allow the High Court to transfer fresh claim judicial reviews to the Upper Tribunal. These are judicial reviews that relate to a refusal by the Home Secretary to treat further submissions as fresh asylum or human rights claims on the basis that they are not significantly different from the material previously considered. These cases have been heard in the Upper Tribunal since October 2011 and the process is working well. This amendment would potentially enable any class of immigration, asylum or nationality judicial review to be heard in the Upper Tribunal.
The further categories of cases that would be transferred to the Upper Tribunal would have to be set out in a direction, or directions, made by the Lord Chief Justice with the agreement of the Lord Chancellor under the provisions in the Constitutional Reform Act 2005. We envisage that the transfers will take place in a staged fashion to increase slowly the types of judicial review dealt with by the Upper Tribunal. The ability to transfer such cases would play an important role in improving access to justice. Immigration and asylum judicial review cases currently form a high proportion—around 70%—of the caseload in the administrative court. The total number of these cases has doubled in the past five years, with around 8,800 being received in 2011. Many of these cases are relatively straightforward. This volume of cases is unsustainable for the administrative court. It keeps High Court judges from other complex civil and criminal cases that they should be hearing. It has created a backlog and has added to waiting times for all public law cases heard by the administrative court.
I recently met the president of the Queen’s Bench Division and the president of the Upper Tribunal immigration and asylum chamber to discuss the progress that has been made in the Upper Tribunal since it was created in 2010. I am persuaded that it now represents the most appropriate venue for the majority of judicial reviews of this type. As the avenue for appeals against a decision of the First-tier Tribunal, the Upper Tribunal deals with thousands of appeals each year. Since acquiring this jurisdiction it has received nearly 200 fresh claim judicial reviews, which have been dealt with more quickly. Fresh claim cases are on average dealt with in seven weeks, compared to an average of 11 weeks for the administrative court. This has not been at the expense of quality. The judges who sit in the Upper Tribunal have a high level of expertise, particularly in relation to in-country conditions and human rights implications, and are regularly joined by judges of the administrative court.
The Upper Tribunal’s expertise in the field of asylum and country guidance cases has been recognised by the higher courts in the UK and the European Court of Human Rights. It is able to make well informed decisions that will deliver justice in these types of judicial review cases, in the same way as the High Court has done in the past. I beg to move.
My Lords, this amendment would allow judicial reviews of immigration and asylum cases and nationality matters to be transferred from the High Court, where judicial review is currently heard, to the Upper Tribunal, as my noble friend has explained. To many of your Lordships, this must feel like Groundhog Day. Parliament made clear its views on whether JRs should be transferred from the High Court into the tribunals once in 2007, during debate on what is now the Tribunals, Courts and Enforcement Act 2007, and again in 2009, during debates on what is now Section 53 of the Borders, Citizenship and Immigration Act 2009. It has said no and has said so powerfully. The arguments against the Upper Tribunal being entrusted with this responsibility still hold good.
The 2007 Act established a new regime, bringing together several tribunal jurisdictions into one structure comprising the First-tier Tribunal and the Upper Tribunal, or UT for short. The Act allowed for the transfer of certain JR applications from the High Court to the UT but, as a result of amendments made during its passage, excluded immigration and nationality JRs from the cases that could be transferred. Parliament returned to this matter, as my noble friend has reminded us, in 2009 during debates on the then Borders, Citizenship and Immigration Bill and again rejected a proposal that would permit the wholesale transfer of immigration and nationality JRs.
The compromise reached was that a JR concerned with a decision on a fresh claim for asylum—that is, one made after an earlier claim and any appeals against its refusal had finally been rejected—was made transferable. Since 2009, the once separate Asylum and Immigration Tribunal has been transferred into the two-tier structure, with an immigration and asylum chamber in the First-tier Tribunal and in the UT. Meanwhile, on a case-by-case basis, the High Court has transferred a few JRs against local authorities concerning the age of separated children seeking asylum to the UT where they have ended up in the immigration and asylum chamber. However, age-dispute JRs can be transferred because they are not decisions about immigration or nationality and are therefore not affected by the 2007 Act. These cases start in the administrative court, but can be transferred to the UT on a case-by-case basis. There have been only four reported cases to date.
Fresh-claim JRs are transferred as a class. There are no reported cases yet and only one case that the tribunal was to hear. The UT has no experience of hearing JR cases so there is no way of assessing whether it is likely to cope well or badly with them. Meanwhile, although there is power to transfer fresh-claim judicial reviews from the Outer House of the Court of Session in Scotland to the UT, that power has never been exercised. I can do no better than cite the comments of the late Lord Kingsland on Report on the Tribunals, Courts and Enforcement Bill. He said,
“first, the Government have broken their promise to your Lordships’ House not to introduce primary legislation permitting the transfer of judicial review matters in asylum and immigration cases until we have sufficient evidence that the system for judicial transfers in other classes of case are working well. Secondly, the Opposition and the noble Lord, Lord Thomas of Gresford, would be extremely unhappy to permit such transfers unless we were satisfied that the transferred AIT single-tier regime to the Upper and Lower Tribunals did indeed have the effect of leading to much fairer and more timely decisions, thus reducing substantially the overall number of judicial review cases … Thirdly, as I have indicated, judicial review is a crucial component in the struggle to protect the individual. Many of these cases raise issues, at best, of the freedom of the individual and, at worst, of torture and death. It is vital that it remains open to someone in such cases to have the application heard by a High Court judge”.—[Official Report, 1/4/09; cols. 1126-27.]
There is no such evidence yet. Powers to transfer JRs into the UT are being sought when it has done only a handful of age assessment cases and has not built up any track record whatever in dealing with fresh-claim JRs. High Court judges have sat in the UT, but there are also judges in that chamber who were adjudicators and special adjudicators of the former Immigration Appellate Authority and its successors. They have never heard cases outside the immigration and asylum tribunal jurisdiction, but the amendment would allow them to deal with JRs on which they have zero experience.
Speaking for the then Government in 2007, the noble Baroness, Lady Ashton of Upholland, accepted that JRs in immigration cases were particularly sensitive. The point was underlined by a forceful observation from the noble and learned Baroness, Lady Butler-Sloss, in Grand Committee in 2006. She said:
“I support my noble and learned friend Lord Lloyd of Berwick in relation to the requirement to have someone of the level of a High Court judge to hear a judicial review in the tribunal. It would be invidious for there not to be a judge of that rank dealing with it. I support my noble and learned friend very strongly”.—[Official Report, 13/12/06; col. GC 68.]
Then there was the noble and learned Lord, Lord Lloyd of Berwick, who said at Second Reading of the Borders, Citizenship and Immigration Bill:
“If the effect ... is that the administrative court would be bound to transfer judicial review applications in all immigration cases, I would be strongly opposed to it”.—[Official Report, 11/2/09; col. 1142.]
The then Minister, the noble Lord, Lord West, winding up that debate, said that,
“the senior judiciary are very supportive of the clause”—[Official Report, 11/2/09; col. 1211.]
that is, the clause providing for the transfer—which he said was shown by the responses of the President of the Queen’s Bench Division, the Master of the Rolls and the Senior President of Tribunals to the consultation on immigration appeals. However, the Master of the Rolls had merely indicated that he supported the views of the President of the Queen’s Bench, who in turn stated that proposals for transfer of JRs in general were welcome, but emphasised that:
“Some of them are plainly suited to the Administrative Court and should remain there”.
The Senior President of the Tribunals agreed with him. The Court of Session judges did not welcome the proposal. They said that,
“any decision as to a more general transfer of judicial review jurisdiction in this area—
“should be made only once the Upper Tribunal has gained extensive experience of implementing its proposed remit”.
No such extensive experience has been gained. Others, including the Immigration Law Practitioners Association, the Constitutional and Administrative Law Bar Association, the Glasgow Immigration Practitioners’ Group, the Law Society, the Refugee Legal Centre, the Refugee Council and individual lawyers, have expressed views similar to those of the judges of the Court of Session.
As the noble Lord has made clear, there is a considerable history here. When he is referring to the bodies that have indicated their objections, could he help the House by indicating whether the objections are indeed to the present amendment or to an earlier one?
As I understand it, my Lords, these representations and views have been expressed by the bodies that I have mentioned in response to this particular legislation. I am relying particularly on the excellent briefing that we have received from ILPA, which quotes all those authorities.
The amendment would allow for the transfer of any immigration or nationality JR by decision of the High Court, the Northern Ireland High Court or the Court of Session in the individual case, and empower the Lord Chief Justice, with the agreement of the Lord Chancellor, to direct that all immigration and nationality JRs or any specific class of these JRs must be transferred. The temptation would be to exercise the powers in an effort to reduce the load on the higher courts, but the right solution is to improve the quality of decision-making so that there are fewer litigants seeking JRs. The number is likely to fall in any case because of the LASPO Act provision that legal aid is no longer available for ordinary immigration cases.
ILPA has set out constructive suggestions for reducing the number of JR applications and indeed the burden on the appeals system as a whole. In 2009, for instance, it requested that UKBA disclose information on the number of immigration and asylum JRs that are conceded by the agency or in which the agency has agreed to make a fresh decision without the need for the process to be seen all the way through. The agency told ILPA that it was too expensive to retrieve this information, but it gave some data on the very large number of immigration JRs that are withdrawn: 1,185 cases in 2006 and 1,532 in 2007. We do not have more recent figures but I hope that my noble friend will tell us what the latest figure is for 2011, to compare with a total of some 9,000 given by my noble friend Lord McNally in his letter to the chair of the JCHR on 12 June.
As was recognised in 2006-07, immigration and asylum JRs are particularly sensitive. It remains the case that the tribunal has not demonstrated the same ability to deal with UKBA’s conduct as a litigant as has the High Court. The agency’s failures to respond in a timely manner to directions from the tribunal to disclose relevant matters or adequately to plead its case are problems that continue to beset all too many cases.
I will not try the House’s patience by going through all ILPA’s suggestions, but there is one that I think will particularly appeal to your Lordships. The Home Office could address the many hundreds of Zimbabwean cases that have contributed substantially to the workload since 2005 by reviewing and, where appropriate, conceding. Many of these cases will include findings of fact justifying a grant of refugee status in the light of the country guidance determination in RN (Zimbabwe), which has just been held not to have been overturned in JG and CM (Zimbabwe), the text of which is awaited.
In conclusion, the reasons given in your Lordships’ debates in 2007 and 2009 for not transferring more JR cases to the UT—that immigration and asylum JRs were the most sensitive cases, and the new chambers’ handling of JRs required testing first—still hold good. The number of cases going to the High Court and Court of Appeal could be reduced by other means, and restricting access to the higher courts would merely encourage or allow for poor decision-making. Decisions of the Court of Appeal on appeals from the UT show that it continues to be the higher courts, rather than the UT, that call for the UK Border Agency to account for its conduct as a litigant.
My Lords, I will say a few words in support of this amendment. In order to understand its importance, one has to take into account the matters that were so clearly outlined by the noble Lord, Lord Avebury, just before I rose to my feet. The history that he has described indicates that this is not an amendment that should be lightly accepted. Time has moved on since some of the matters to which he referred arose, and the experience so far of the quality of the tribunals, particularly the Upper Tribunal, has been particularly good.
The other important matter is the resource of High Court judges. The demands for the services of High Court judges are extensive. At present, there is the grave danger that judicial review will not be able to achieve one of its most necessary characteristics, which is to deal expeditiously with the urgent applications that come before it. This is critical because sometimes the very fact of the application for judicial review can and does delay matters of great importance—I hope am not overstepping the mark in saying matters, often, of national importance. The information that is available as to the pressure on High Court judges makes clear that they are overstrained. That is one side of the picture.
The other side of the picture is that the Upper Tribunal has huge expertise, which except in a very small number of cases is not available to High Court judges. Therefore, it is not apparent that they have the ability to deal with these cases as expeditiously and effectively as the tribunal. The danger in not accepting this amendment is that the desire for excellence could be the enemy of the good, and I urge the Committee to be sympathetic to it. It is my belief that justice can and should be ensured, as it always is in this country when these matters are dealt with by the tribunal as proposed here. I know that those who are responsible for arranging the proper dispatch of business in the different parts of the High Court attach the greatest importance to this amendment. They see it as a lifeline.
My Lords, I was not a Member of your Lordships’ House at the times when, as the noble Lord, Lord Avebury, reminded the Committee, similar matters were debated at some length. Therefore, I come to this amendment with an open mind, which creates something of a precedent in my case. I listened very carefully to the Minister’s explanation and justification of the amendment and, of course, to the critique of it from the noble Lord, Lord Avebury. Although many of us have received extensive briefings about various aspects of this Bill and other legislation, I have not received any particular briefing from any of the organisations referred to by the noble Lord, Lord Avebury, on this point.
I initially leant towards his line of argument, but am comforted in the first instance by the fact that the Lord Chief Justice’s role will be critical in initiating any further transfers, as well as by the wisdom and experience of the noble and learned Lord, Lord Woolf, of course, who commends the amendment to the Committee. Perhaps when he replies the Minister will indicate whether it is the Government’s intention to review progress at some stage, perhaps in conjunction with the Lord Chief Justice, to see whether the fears that the noble Lord, Lord Avebury, enunciated are grounded in relativity, and if they are to create an opportunity for a change in policy, either slowing down the additional transfers or possibly rethinking the policy.
As we have been reminded on previous occasions, it is the Government’s policy to conduct a post-legislative review within three to five years. Perhaps an indication that that will also be the case in relation to this matter might satisfy—for the time being, at any rate—some of the doubts that have been raised. If it is necessary to step back in the light of experience, that could then happen. For the moment, I am disposed to accept the Government’s amendment and rely very heavily on the support given to it by the noble and learned Lord, Lord Woolf.
My Lords, I am very grateful to the noble Lord, Lord Beecham, for that indication of the Opposition’s support for this amendment. I gladly give him, and the noble Lord, Lord Avebury, an assurance that what we are doing will be kept under review in close consultation with the judiciary.
It is true that this matter was discussed in 2009, as the noble Lord, Lord Avebury, said, but we have now had three years’ experience of the workings of the Upper Tribunal in these areas and we have also had representations from the senior judiciary about how the present system is clogging up the High Court and bringing some of the pressures to which the noble and learned Lord, Lord Woolf, referred.
I have not taken lightly the decision to bring this back to the House. In a meeting, the president of the Queen’s Bench Division and the president of the Upper Tribunal convinced me of two things: first, that we would be taking some pressure off the High Court and High Court judges by doing this; and, secondly, that by moving these cases to the Upper Tribunal we would in no way diminish the quality of justice available. On the contrary, as the noble and learned Lord, Lord Woolf, indicated, a great deal of the expertise for judging these cases is in the Upper Tribunal.
I take the point that the noble Lord, Lord Avebury, made about the UK Border Agency’s withdrawals. There are varied reasons for cases being withdrawn but, coupled with other government reforms, we are getting a better system for dealing with these cases from the UKBA. The senior judiciary is broadly in favour of the amendment as a sensible solution to the backlogs in the High Court and an opportunity to transfer cases to the most appropriate part of the justice system. There has been strong judicial involvement in the discussions preparing for this amendment, and the judiciary is keen to ensure that it is successfully introduced. As the noble Lord, Lord Beecham, said, the Lord Chief Justice will be closely involved with the Lord Chancellor in gauging the pace of movement on this so that we get the twin benefits of faster, efficient, high-quality justice in immigration cases and some elbow room in the High Court to deal with the important cases that the noble and learned Lord, Lord Woolf, mentioned.
I hope the noble Lord, Lord Avebury, will be content to take those assurances and to accept that this decision has been taken on the basis of the experience of the past three years, which we believe is entirely favourable to the move that we are making. That is coupled with the assurance that we will keep the matter under review and will be in close contact and consultation with the senior judiciary to ensure that the move is completely in keeping with the access to good justice that is the aim of this amendment.
My Lords, can my noble friend answer the question I put to him about how many cases were withdrawn by the UKBA—to correspond with the figures I gave for 2006 and 2007? If a very large number are being withdrawn, and thus the UKBA is conceding that the original decision was wrong, surely that proves that there are other methods of reducing the pressure on the High Court rather than transferring all these cases to the tribunal.
My Lords, I am not sure that the Minister answered the point made by the noble Lord, Lord Avebury, about the relative inexperience of the Upper Tribunal in immigration. He quotes the wise and the good, and we have heard from the noble and learned Lord, Lord Woolf, but surely we are not making a decision on the basis of advice only but on the actuality of the court over the period.
The point was made that the Upper Tribunal over the past three years has demonstrated very clearly that it has both the experience and the expertise to deal with these matters. The Upper Tribunal’s expertise in reducing backlogs in the Administrative Court has been demonstrated. I do not have the most up-to-date figures on UKBA withdrawals, but in my closing remarks I accepted that one issue was the UKBA’s tendency in the past to withdraw objections. Reforms that are being taken forward by my right honourable friend the Home Secretary aim to deal with some of those criticisms of the UKBA.
However, that does not take away the central thrust of this proposal that since 2009 the Upper Tribunal has shown itself to be working well, and we are not rushing our fences in this case. Both the Lord Chancellor and the Lord Chief Justice will be closely involved in gauging the movement of cases to the Upper Tribunal, but no one has seriously doubted its competence or expertise to deal with these matters. On the contrary, it has shown itself to be remarkably efficient at cutting time for dealing with cases, which must be in the interests of justice.
Amendment 135 agreed.
Schedule 13 : Deployment of the judiciary
136: Schedule 13, page 202, line 33, after “Wales)” insert “or the President of Employment Tribunals (Scotland)”
Amendment 136 agreed.
137: Schedule 13, page 203, line 39, leave out “1” and insert “2”
My Lords, these amendments all relate to the provisions on the deployment of the judiciary. Of particular note is Amendment 140, which introduces an emergency procedure regarding the appointment of deputy judges of the High Court when there is an urgent need to do so. The Bill introduces a Judicial Appointments Commission process for appointing deputy High Court judges and authorising circuit judges and recorders to sit in the High Court. This is an important reform to increase transparency regarding these appointments.
Amendment 140 would deal with situations where there is an urgent and unforeseen demand for a deputy High Court judge and it is not practicable to draw on any judges of the High Court or any of those who have been selected previously by the Judicial Appointments Commission, or to deploy any other judge who is authorised to sit in the High Court or Crown Court in the time available.
The amendment inserts new Section 94AA into the Constitutional Reform Act 2005. The purpose of this new section is to specify clearly circumstances in which the normal Judicial Appointments Commission selection exercise may not be applied in the appointment of a deputy judge of the High Court for a definite period. This may be needed in exceptional circumstances, such as a number of judges being unwell or suffering some other unexpected misfortune, meaning that a particular area of expertise is required at short notice. The amendment specifies what criteria must be applied if the Judicial Appointments Commission is not to select deputy judges of the High Court. It also clearly limits the duration of the appointment to the disposal of the particular business that gave rise to the use of the power.
Amendment 145 inserts a new Part 3A into Schedule 13 of the Bill. The new part deals with the deployment of judges to the Court of Protection. Our new deployment policy has been applied in this jurisdiction and all judicial officeholders are now able to be nominated to sit in the Court of Protection, including deputies and temporary appointees. Of course, in this and all jurisdictions, judges may be deployed only if the Lord Chief Justice determines that the judge possesses the necessary expertise and experience and deems in all other circumstances that it is appropriate for that particular judge to be deployed to that specific jurisdiction. In this jurisdiction, there has been a particular difficulty in ensuring that the court is fully resourced with judges that have the necessary skills and ability to hear these complex and often difficult matters. The amendment enables the Lord Chief Justice to provide appropriate judicial resources from a broader pool of candidates; it also widens the group of judges who can be appointed to act as the senior judge of the Court of Protection, handling certain administrative functions to that court.
The other amendments in this group on judicial deployment are either consequential or drafting amendments to ensure that we have made all the necessary changes and adjustments to Schedule 13 of the Bill. I will not detain the Committee further with this group of amendments, but I can provide further details of these amendments if needed. I beg to move.
Perhaps I could ask the Minister what may be a rather stupid question. Unfortunately, I do not have the Mental Capacity Act in front of me, but I assume that the President of the Family Division and the judges of the Family Division and the Chancery Division are still on the list of those who will be trying these cases, as they are usually the judges who do it.
I want to ask my noble friend a question about Amendment 140. He described the circumstances and need for flexibility in the ability to appoint temporary High Court deputy judges. I would like to ask about the business for which they would be needed, in proposed new Section 94AA(2)(a), which refers to both an “urgent need” and the “disposal of particular business”. He mentioned the need for special expertise, but has he any further examples of what the “particular business” might be? I take it that we are not being asked to agree to temporary appointments to deal with urgent business per se. It is the term “particular business” that interests me. I could have pictured this clause better if it did not refer to “particular business” but to “business” in general. I am sorry that I did not give the Minister notice of the question. He may wish to come back to it at a later point.
I, too, am rather sad that my noble friend did not give me notice of the question. I am pleased that we are bringing in a role for the Judicial Appointments Commission in the appointment of deputy High Court judges. To put it bluntly, there was a suspicion in some areas that the appointment of deputy High Court judges was the last surviving remnant of the “tap on the shoulder” system of appointments. Therefore the proposals to bring the appointments commission into the process are important.
However—I say this in the presence of the noble and learned Lord, Lord Woolf, with all his vast experience—we were determined not to put the Lord Chief Justice of the day into a straitjacket. He has to be responsible on a day-to-day basis for deploying the judiciary and, if there is a need to appoint a deputy in an emergency, we should have the ability to do so. Hence, in introducing the provision, there are many references to exceptional circumstances and a definite period so that this emergency procedure would not lead, again, to a way of appointing deputy High Court judges by a tap on the shoulder. It leaves the Lord Chief Justice of the day with the wriggle room to deploy efficiently but makes sure that the main appointment of deputies now comes within the ambit of the Judicial Appointments Commission.
As for specific examples, the best I can do is to write to my noble friend giving her some examples, which I hope will reassure her. I shall, of course, put a copy of the letter in the Library of the House for the benefit of the Committee.
Fairly recently I asked questions in the House about employment tribunals and I was told by the Government that an investigation into them was currently proceeding and that we would be told the results in due course. Does the change of title listed in Amendment 146 from “chairmen of employment tribunals” to “Employment Judges” form part of that general investigation?
Perhaps I may help my noble friend by illustrating the kind of particular business there could be. In the old days it was not so much a tap on the shoulder as a ring-round by the Lord Chancellor’s Department to find someone who could go and do particular cases on very short notice. I recall being asked to go to Leeds with the inducement that I could stay in the judges’ lodgings—not much of an inducement, I may say—to try three large medical negligence cases. They said, “Don’t worry, they’ll all settle”. In fact, they all stood up. That is the sort of instance when counsel on both sides are all ready to go ahead on a fixed date but there is no High Court judge to take it. Everybody assumes that the cases will settle but they do not.
I am glad that the noble Lord is not emulating Rasputin in terms of his trips across the ice.
The Opposition do not take issue with the amendments but it is interesting that in a move to simplify the system we have a complex series of amendments. They add several pages to Schedule 13. By sheer chance today, a Mr Patrick O’Brien, a research associate of the Constitution Unit, has written a blog—I suppose that is what it is—about the issue of judicial appointments under the Bill. He makes the point:
“The new system in its entirety will, if anything, be even more complex than the present arrangements. It will be a hydra with three heads—the Lord Chancellor, Lord Chief Justice and the Senior President of Tribunals (and indeed five heads if you include the formal roles of the Prime Minister and the Queen), all of whom will have roles in approving appointments of various types—and at least five variants of appointment commissions/panels in addition to the JAC. There is the potential for further variations on these commissions/panels though the use of regulations. As things stand, the use of regulations in the Bill adds complexity and uncertainty to the CRA rather than removing it”.
Can the noble Lord give an indication of when, if at all, regulations will be introduced and what they might cover? Mr O’Brien goes on to say: “The CRA”—Constitutional Reform Act—
“is not just addressed to civil servants”—
or Members of your Lordships’ House or indeed the other place. He continues:
“It has constitutional significance and”,
“comprehensible to the general public”.
The noble Earl, Lord Attlee, referred to improvements in satnav technology when he was answering a Question on transport earlier. The implication of Mr O’Brien’s article is that we need the equivalent of satnav to navigate through this complex field of appointments. Having said that, we do not object in principle but it would be helpful if a guide were available to the public as well as to the practitioners so that they can see how the new system is supposed to work. Again, as with the previous amendment, I assume that the Government will be monitoring developments and will ensure that problems are dealt with in due course.
My Lords, I am extremely grateful to the noble Lord, Lord Beecham, for his indication of support and for some sensible suggestions that I hope will assist the Committee. We will be publishing draft regulations before Report. The idea of a simplified guide on how these will impact is very sensible and I will take that back to my right honourable friend the Lord Chancellor. Amending existing legislation can be extremely complex when fitting in new proposals to existing legislation.
The noble and learned Lord, Lord Falconer—I was going to say my noble friend—along with the noble and learned Lord, Lord Woolf, showed a certain pride of authorship in the new disposition of our legal system after the reforms of the earlier part of this century. What we are trying to do, in our different ways, is build on reforms that have given us an effective system. These include promoting greater diversity in our judiciary. As we were discussing the other day, we are also conscious of the important nexus of the system, with the President of the Supreme Court, the Lord Chief Justice and the Lord Chancellor.
We want the benefits of the Legal Appointments Commission and transparency in appointing our judiciary but we do not want to impinge on, or to put into a straitjacket, the ability of the Lord Chief Justice of the day to deploy judiciary as and when needed. That is why I was grateful to my noble friend Lord Thomas of Gresford for giving such a good example. What we are trying to do, particularly in Amendment 140, is to give the flexibility that allows the phone call to get the judge to the right place so that a whole range of people—engaged barristers, witnesses, et cetera—are not all put to discomfort because a judge is not available.
I will take back and look at some of the points made in this debate; not least, once we have these reforms in place, how we can make them more cohesively understood by the public so that they have confidence in the transparency of appointment, the method of deploying the senior judiciary and the interrelation between the two. I will also look at point the noble Lord, Lord Beecham, made—that the regulations that are such a key part of our proposals should be made available to this House before Report. With that, I hope that the Committee has the confidence to accept these amendments.
Amendment 137 agreed.
Amendments 138 to 146
138: Schedule 13, page 203, line 41, leave out “Chancellor” and insert “Chief Justice”
139: Schedule 13, page 204, line 4, leave out “1 of”” and insert “2 of”, and
(b) paragraph 38 of Schedule 12 has effect—(i) as if a reference to the office of deputy judge of the High Court were inserted at the beginning of the list in sub-paragraph (4) of that paragraph, and(ii) as if “second” were substituted for “first” in sub-paragraph (5) of that paragraph”
140: Schedule 13, page 204, line 4, at end insert—
“(3) After section 94A of the 2005 Act (appointments not subject to section 85: courts) insert—
“94AA Appointments not subject to section 85: High Court deputy judge
(1) Where this section applies to an appointment, section 85 does not apply.
(2) This section applies to the appointment of a person as a deputy judge of the High Court if it appears to the Lord Chief Justice, after consulting the Lord Chancellor, that—
(a) there is an urgent need to take steps in order to facilitate the disposal of particular business in the High Court or Crown Court,(b) it is expedient as a temporary measure to make the appointment in order to facilitate the disposal of the business, and(c) there are no other reasonable steps that it is practicable to take within the time available in order to facilitate the disposal of the business.(3) An appointment to which this section applies is to be made—
(a) so as not to extend beyond the day on which the particular business concerned is concluded, or(b) so as not to extend beyond the later of—(i) the day on which the business is concluded, or(ii) the day expected when the appointment is made to be the day on which the business is concluded.”(4) In section 85(2A)(d) and (4) of the 2005 Act after “94A” insert “, 94AA”.”
141: Schedule 13, page 204, line 41, leave out “chairmen of employment tribunals” and insert “Employment Judges”
142: Schedule 13, page 204, line 42, after “Wales” insert “or for Scotland”
143: Schedule 13, page 205, line 36, leave out “chairmen of employment tribunals” and insert “Employment Judges”
144: Schedule 13, page 205, line 37, after “Wales” insert “or for Scotland”
145: Schedule 13, page 205, line 41, at end insert—
“Part 3ADeployment of judges to the Court of Protection5A (1) Section 46 of the Mental Capacity Act 2005 (judges of the Court of Protection) is amended as follows.
(2) In subsection (2) (persons who may be nominated as court’s judges) omit the “or” at the end of paragraph (d) and, after paragraph (e), insert “,
(f) a District Judge (Magistrates’ Courts),(g) a judge of the First-tier Tribunal, or of the Upper Tribunal, by virtue of appointment under paragraph 1(1) of Schedule 2 or 3 to the Tribunals, Courts and Enforcement Act 2007,(h) a transferred-in judge of the First-tier Tribunal or of the Upper Tribunal (see section 31(2) of that Act),(i) a deputy judge of the Upper Tribunal (whether under paragraph 7 of Schedule 3 to, or section 31(2) of, that Act),(j) the Chamber President, or Deputy Chamber President, of a chamber of the First-tier Tribunal or of a chamber of the Upper Tribunal,(k) the Judge Advocate General,(l) a Recorder,(m) the holder of an office listed in the first column of the table in section 89(3C) of the Senior Courts Act 1981 (senior High Court Masters etc),(n) a holder of an office listed in column 1 of Part 2 of Schedule 2 to that Act (High Court Masters etc),(o) a deputy district judge appointed under section 102 of that Act or under section 8 of the County Courts Act 1984,(p) a member of a panel of Employment Judges established for England and Wales or for Scotland, (q) a person appointed under section 30(1)(a) or (b) of the Courts-Martial (Appeals) Act 1951 (assistants to the Judge Advocate General), (r) a deputy judge of the High Court,(s) the Senior President of Tribunals,(t) an ordinary judge of the Court of Appeal (including the vice-president, if any, of either division of that court),(u) the President of the Queen’s Bench Division,(v) the Master of the Rolls, or(w) the Lord Chief Justice.”(3) In subsection (2)(b) for “Vice-Chancellor” substitute “Chancellor of the High Court”.
(4) In subsection (4) (a judge nominated under subsection (2)(d) or (e) must be appointed senior judge of the court) for “or (e)” substitute “to (q)”.
(5) In section 4(5)(f) of the Human Rights Act 1998 (things done by certain judges in Court of Protection) for “Vice-Chancellor” substitute “Chancellor of the High Court”.”
146: Schedule 13, page 208, line 17, at end insert—
“Part 7Amendments following renaming of chairmen of employment tribunals12 (1) In the following provisions for “chairmen”, or for “chairmen of employment tribunals”, substitute “Employment Judges”—
Constitutional Reform Act 2005: section 3(7B)(d) and (e),
Courts Act 1971: Part 1A of Schedule 2,
Courts and Legal Services Act 1990: Schedule 11,
Employment Tribunals Act 1996: sections 3A, 5A, 5B(4), 5D(2)(e) and 7B(6),
Judicial Pensions Act 1981: section 12(1)(c),
Judicial Pensions and Retirement Act 1993: section 26(12A)(i), and
Tribunals, Courts and Enforcement Act 2007: sections 4(1)(e) and (3)(d) and 47(5)(c)(iii), paragraph 12(1)(c) of Schedule 1 and paragraph 7(1)(a) of Schedule 2.
(2) In the following provisions for “chairman of employment tribunals” substitute “Employment Judge”—
Constitutional Reform Act 2005: Part 3 of Schedule 14, in both places,
Tribunals, Courts and Enforcement Act 2007: paragraph 6(1)(e) and (4)(b) of Schedule 7, and
Judicial Pensions and Retirement Act 1993: Schedules 1 and 5.
(3) In sections 10(4) and 30(2B)(b) of the Employment Tribunals Act 1996 for “Chairman” substitute “Employment Judge”.
(4) In Part 3 of Schedule 1 to the House of Commons Disqualification Act 1975 for “or member of a panel of persons appointed to act as chairmen or other members of employment tribunals” substitute “Employment Judge, or member of a panel of members of employment tribunals that is not a panel of Employment Judges”.
(5) In paragraph 5(2)(g) and (5)(vii) of Schedule 7 to the Judicial Pensions and Retirement Act 1993 before “chairman” insert “Employment Judge, before 3 November 2008 called”.”
Amendments 138 to 146 agreed.
My Lords, this may be a convenient moment to repeat a Statement made by the Prime Minister about the European Council. The Statement is as follows.
“I am sure that the whole House will be deeply saddened by the death of three British servicemen in Afghanistan yesterday. These brave soldiers were demonstrating great courage to prevent Afghanistan once again becoming a haven for international terrorists and helping to keep us safe here in the United Kingdom. The suspected perpetrator is in custody and we will do everything in our power, with the Afghan national security forces, to ensure that justice is done. This tragic incident again demonstrates the very real risks that our soldiers face every day and we will learn all the lessons that arise from it. I know that everyone in this House will want to send their support to our brave troops and their families at this difficult time.
Turning to the European Council, Britain had three objectives at last week's European Council. The first was for eurozone members to take the urgent action needed to deal with the immediate crisis. The second was to secure a comprehensive growth package firmly focused on Britain's priorities and the third was to send a clear message to the rest of Europe about what Britain expects from the budget negotiations to come.
Under the previous Government, we could have been liable for financial support for these measures, as members of the EU bailout fund. But this Government have repatriated that power, so the British taxpayer is not involved.
On longer-term issues, eurozone members agreed important steps towards closer integration following a discussion of a report by the president of the European Council and others. It is vital for Britain—and for the strength and prosperity of the whole European Union—that they do this in the right way. I secured agreement that as this work goes ahead the “unity and integrity of the single market” will be fully respected. On the specific proposal of a banking union, I ensured that Britain will not be part of any common deposit guarantees or under the jurisdiction of any single European financial supervisor. I am very clear that British taxpayers will not be guaranteeing any eurozone banks and I am equally clear that, while we need proper supervision of our banks, British banks will be supervised by the Bank of England, not the ECB.
The original draft of the growth compact included a whole section on economic and monetary union which implied that a banking union might apply to all 27 countries. A number of countries worked to ensure that that whole section was removed.
We want a budget that is focused on growth not a focus on growth in the budget. EU members as a whole are €3.5 trillion more in debt now than when the last budget was negotiated and we have to face up to that tough reality. I made it clear that without the British rebate we would have the largest net contribution in the EU as a share of our national income. Without the rebate, it would be double that of France and almost one and a half times bigger than that of Germany. So the British rebate is not up for renegotiation. It is fully justified.
On foreign policy, the Council welcomed the EU oil embargo against Iran which came into force yesterday. On Syria, we called for united action by the UN Security Council to add more robust and effective pressure on Assad’s regime, including the adoption of comprehensive sanctions.
Europe is changing rapidly and fundamentally, and this presents real challenges for all countries. Those inside the eurozone have to face fundamental choices about whether to limit their national democracy and provide financial support to the weaker members, and like others outside the eurozone, in Britain we also face big choices too.
As Europe changes to meet the challenges of the eurozone, so our relationship with Europe will change too. There are those who argue for an in-out referendum now. I do not agree with that because I do not believe that leaving the EU would be best for Britain. But nor do I believe that voting to preserve the exact status quo would be right either. As I wrote yesterday, I do not believe that the status quo is acceptable. But just as I believe it would be wrong to have an immediate in-out referendum, so it would also be wrong to rule out any type of referendum for the future.
The right path for Britain is this. First, we must recognise that in the short term the priority for Europe is to deal with the instability and chaos. Secondly, over time we must take the opportunities for Britain to shape its relationship with Europe in ways that advance our national interest in free trade, open markets and co-operation. That should mean, as I argued yesterday, less Europe not more Europe: less cost, less bureaucracy, less meddling in issues that belong to nation states.
Thirdly, all party leaders will have to address this question. But it follows from my argument that far from ruling out a referendum for the future, as a fresh deal in Europe becomes clear, we should consider how best to get the fresh consent of the British people.
Finally, as I have said, as the eurozone moves to a banking union, we must ensure that Britain can take responsibility for sorting out its own banking sector. On the unfolding banking scandal here in the UK, we need to take action right across the board, introducing the toughest and most transparent rules on pay and bonuses of any major financial centre in the world, increasing the taxes banks must pay, ensuring tough civil and criminal penalties for those who break the law, and above all, clearing up the regulatory failure left by the previous Labour Government.
The British people want to see two things. They want to see that bankers who act improperly are punished and they want to know that we will learn the broader lessons of what happened in this particular scandal. On the first, the Serious Fraud Office is looking at whether there are any criminal prosecutions that can be brought, and it is using the full force of the law in dealing with this. On the second, I want to establish a full parliamentary committee of inquiry involving both Houses and chaired by the chairman of the Commons Treasury Select Committee. This inquiry will take evidence under oath, have full access to papers, officials and Ministers, including Ministers and special advisers from the previous Government, and it will be given, by the Government, all the resources it needs to do its job properly. The Chancellor will be making a full Statement, but this is the right approach because it will be able to start immediately, it will be accountable to this House, and it will get to the truth quickly, so we can make sure this never happens again.
I commend this Statement to the House”.
My Lords, I thank the Leader of the House for repeating the Statement by the Prime Minister on the outcome of the European Council meeting.
On the tragic news from Afghanistan, all our thoughts are with the families and friends of the soldiers concerned. This news reminds us once again of the risks our troops face daily and of our duty to do everything we can to protect them.
The Prime Minister in the other place included in his Statement on Europe a statement on banking. Leaving aside the admirable vote of confidence in his Chancellor, who is following the Prime Minister's Statement with his own Statement on banking, we on these Benches believe that it is right that the Prime Minister has reconsidered the position that he set out last week on the need for a full inquiry. However, we are not convinced that the way forward on this issue is the Joint Committee that he is proposing. It does not suggest that the Government have grasped the scale of the problem. We know that politicians investigating bankers will not convince the people of this country; nor is it the way we can build the consensus that is needed for real change. After all, there have already been a number of Select Committee reports into the banking crisis.
The crisis surrounding the banks now demands an inquiry similar to the inquiry into press behaviour currently being carried out by Lord Justice Leveson. We appreciate that the Leveson inquiry has been uncomfortable for politicians on all sides, but that is exactly how it should be. We will continue to argue for a full and open inquiry, independent of bankers and politicians, and we will table an amendment to the Financial Services Bill to this effect in order to get a proper inquiry that will be trusted by the people. We do not believe that we will rebuild public trust by having politicians investigating bankers. Like the Leveson inquiry, an inquiry needs to be searching, to expose what has been happening and to get to the truth. Furthermore, as we on these Benches hope will be the case with the Leveson inquiry, it needs to bring forward remedies to stop the practices, whether in journalism or in banks, that the public and all Members of this House oppose. That is how eventually trust will be rebuilt.
I turn now to Europe and the European Council meeting. On Syria, let me associate these Benches with what the Statement said. There was an agreement reached at Geneva on Saturday, but in truth there was little progress. The divisions within the international community on this issue mean that too little is being done to bring the escalating violence to an end. In that context, can the noble Lord, the Leader of the House, update your Lordships’ House on the position of Russia regarding a future for Syria without President Assad?
The European summit took place against a backdrop of the continuing crisis in the eurozone, a global recovery faltering, and a double-dip recession here in the UK. The central challenge is how we can have a Europe not of austerity and unemployment but of jobs and growth. On that central issue, the Government cannot be part of the solution because the Government are part of the problem. They have no answers and nothing to offer. On growth, the Prime Minister used an instructive phrase in his post-summit press conference. He said that,
“just as we had to tackle the euro crisis, so we have to tackle the growth crisis”.
He then added:
“Britain has been driving this debate”.
That really does suggest someone getting increasingly out of touch with reality because as the Prime Minister was speaking figures were coming in showing that the double-dip recession, created in Downing Street, was worse than we thought. The UK is one of only two countries in the G20 to be in a double-dip recession, with long-term youth unemployment having doubled during the past year. The summit agreed extra resources for the European Investment Bank for youth unemployment. Why do the Government appear to support action on this crucial issue in Europe while failing to act here at home? There can be no solution to the growth crisis unless we tackle the crisis of demand in the European economies and globally. Did the Prime Minister advocate any measures at the summit to bring this about?
On the banking regulator, what specific legal safeguards will the Government seek to secure between now and December’s final proposals to protect Britain’s interest in the single market? On the eurozone and bank recapitalisations, it is welcome that direct help can be provided to eurozone banks, but do the Government really believe that the funds that eurozone countries are making available are adequate? On the Patent Office, the Prime Minister says that the outcome is a sign of his success, but, as he argued for the office to be headquartered in London, how could the decision to base it in Paris be a diplomatic triumph?
I turn finally to the Prime Minister's position—or should I say positions?—on Europe. On Friday, the Prime Minister ruled out a referendum on Europe, saying:
“I completely understand why some people want an in/out referendum … I don’t think it’s the right thing to do”.
However, hours later, 100 Conservative Back-Benchers in the Commons and the former Defence Secretary called for an in/out referendum. Then, mysteriously, on Sunday, the Prime Minister hinted that he was ruling in a referendum. The Foreign Secretary then went on television and said:
“The Prime Minister is not changing our position”.
Three days, three positions. First, it was no; then it was yes; now it is maybe. Can this House have some clarity about the Government’s stance? First, has there been a change in the Government's position? Secondly, the Prime Minister spoke about a referendum being connected to the renegotiation of powers. Are the Government now saying that they might be in favour of withdrawal from the European Union if they do not get these powers? That would be a new position. Is it the Government’s position? Thirdly, can the Leader of the House explain the following? The Prime Minister said last October that,
“there is a danger that by raising the prospect of a referendum … we will miss the real opportunity to further our national interest”.—[Official Report, Commons, 24/10/11; col. 27.]
Why is the Prime Minister doing precisely that now?
Will the Leader of the House confirm that the Prime Minister’s raising this issue has nothing to do with the national interest? He is doing so not to sort out the crisis of growth here at home or across the EU, or to tackle the disgrace of youth unemployment, but in an effort to manage the divisions in the Conservative Party.
Five years ago, then in opposition, the Prime Minister said that his party should stop banging on about Europe, but now he is the man getting out the drum. The country is confused about this Government and Europe—a veto that never was, a referendum which may happen, but not now. This is a party, the party opposite, talking to itself and not to the country. Britain deserves better. It is time that the Government started doing better for the people of this country.
My Lords, perhaps I may clarify to my noble friend that there will be two Statements this afternoon, the second of which will be repeated by my noble friend Lord Sassoon, as is laid out on the screens, and will come immediately after Back-Bench time on this Statement.
As ever, I thank the Leader of the Opposition for her remarks. She asked plenty of questions and I shall try to deal with them fully. She expressed dissatisfaction at the Prime Minister having said that there should be an inquiry into banking and the LIBOR problem, because it was the wrong sort of inquiry. She said that her party would put down an amendment to a Bill before this House. She expressed disappointment with what the Government were doing, which is a pity, because I would have thought that one place where there is a good deal of expertise was in Parliament. To have a Joint Committee of both Houses looking at this matter, with Members of our Economics Affairs Committee sitting with their colleagues in the House of Commons, should surely be enormously welcome. It should also be able to respond quickly. We hope that it will get to work straightaway, call witnesses over the next few months and report by Christmas so that recommendations can be included in the Vickers Bill in the New Year. That seems to be an appropriate way forward.
The noble Baroness asked for our thoughts on Syria. She correctly recognised what a difficult situation it is. The situation remains grave, with hundreds of people dying every week. However, the Foreign Secretary was engaged this weekend in intensive talks in Geneva on a transition plan which included the Foreign Ministers of Russia, China, and other countries. The result is one step forward, which is worth having. We agreed with Russia and China that there should be a transitional unity Government in Syria, which should be made up of people from the present Government, the opposition, and other groups on the basis of mutual consent. It would of course exclude President Assad. We must now try very hard to bring this about. We are putting a great deal of energy into doing so, but nobody is under any illusions of just how complex all of this going to be, given the situation that exists in Syria.
The noble Baroness, the Leader of the House—
Sorry, the noble Baroness the Leader of the Opposition, the former Leader of the House, also talked about the Europe of jobs and growth. She said that the Prime Minister could not deliver this in the United Kingdom, and asked why he therefore thought he could deliver it in Europe. That is to completely misunderstand what this Government have been doing, and, of course, to misunderstand quite deliberately. We want to rebalance the economy, with private sector growth taking the place of government deficits. We want prosperity shared across all parts of the UK. We want to become a world leader in advanced manufacturing and knowledge-based industries and services, and to remain the world’s leading centre for financial services. We have done this by cutting corporation tax, ensuring access to finance, dealing with the red-tape challenge, and many other brave and sensible pieces of action which will take the Government forward, from where we were under Labour’s misrule towards long-term growth and prosperity based on real jobs.
The noble Baroness asked about the European Patent Office. She said that it was not going to be based in London. This has been discussed and debated for over 23 years. It is an area in which Britain excels. The Council has decided that the patent office should be based in three parts of the European Union: in London, Paris and Munich. The most significant part of it as far as we are concerned—pharmaceutical and life science industries—will be based here in London. It will bring a turnover of over £100 million-worth in legal services into the United Kingdom.
Much of what the noble Baroness asked about concerned the referendum. I have believed for a long time that the real muddle on European policy lies in the party opposite, and not in our party at all. We said that an in/out referendum is not the answer right now, and we stick to that. A referendum on a choice between the status quo and coming out completely when Europe is changing would be the wrong choice. It would be a bad time to make a decision. Europe is changing a great deal, probably more so currently than it has done for very many years. Indeed, it is entirely right for my right honourable friend the Prime Minister to look at how we want to change our relationship with Europe, and as the end point becomes clear, to consult the British people either in a general election or a referendum. I regard that as a very strong position. If the Labour Party disagrees with consulting the British people, they should say so.
My Lords, first, I welcome the sentiment expressed by the Leader of the House and the Leader of the Opposition about the death of the three British soldiers in Afghanistan. Our prayers and thoughts will remain with their families and friends.
I have two questions for the Minister. On the compact for growth and jobs, which will release €125 million for immediate investment, the noble Lord was broad enough to explain the area that may benefit Britain. Could he be more specific about what the real benefit to Britain will be from that money? Secondly, it is proposed that a group of eurozone members might pursue various measures, such as a financial transaction tax, through enhanced co-operation among themselves. If they do, will the Government ensure that Britain’s rights under the single market are maintained?
My Lords, my noble friend’s last point is crucial. There was real concern at the European Council and suggestions from other countries that a European banking supervisory system would be precisely that—for all the banks in Europe, including those in the United Kingdom. My right honourable friend the Prime Minister and others said that that should not and could not be the case, and we ensured that the final terms of the agreement ensured that British banks would not be a part of that but would continue to be regulated by the Bank of England. Within the eurozone area, it is of course entirely appropriate that they look at ways to improve banking supervision, ensuring deposits and working more closely together. That, too, should be welcomed.
As for growth, we are all pointing in the same direction. We want deregulation. We want a clearer completion of the single market, particularly in digital and energy. That will have an important impact on the European economy and, in particular, on the United Kingdom economy.
My Lords, does the Leader of the House accept my welcome that the lessons of last December seem to have been learnt on this occasion and that the Prime Minister has recognised that the right way to protect British interests is to stay at the negotiating table, not to reject any participation in negotiations? In my view, that is highly welcome.
As the Prime Minister begins to dance with wolves on referendum issues, does the noble Lord agree that it does not make much sense to parody the situation and the choice before us by talking about more Europe or less Europe? If we read the European Council conclusions, which I am glad the Prime Minister subscribed to, we see a great deal of more Europe in them in relation to the single market. There are references to patents, to the digital single market and to the single market in services, all of which require more Europe. It makes no sense at all to say that the British position is in favour of less Europe.
On Syria, does the Minister recognise that the Russian situation may not be one that we can work our way around? I am not criticising for one minute the attempt made in Geneva to achieve common ground, but it is doubtful whether that achievement is real or just apparent. If it is not real, it will surely be necessary to go to the Security Council to table a resolution imposing measures on the Syrian regime if it does not observe and honour the provisions of the Annan plan and put it to a vote, come what may. The only way you can find things out in the Security Council is by eventually putting it to a vote. If the Russians wish to veto it, they will do so, and that will be their responsibility.
I shall take those points in order. The noble Lord welcomed the fact that the Prime Minister wants to work together with his European partners. Of course, that has always been the case, including last December, when my right honourable friend was ready to support treaty change for the 27 in return for specific and practical proposals, which we put forward to safeguard the integrity of the single market. These proposals were not an opt-out for the UK, as some have suggested; they would have applied to the EU as a whole. However, other countries blocked them, and without those protections it was entirely correct that my right honourable friend used his veto.
Of course, there are some vital parts of the EU that have a positive impact upon the United Kingdom, and we should seek to preserve these. Equally, it is right for the Government to conduct a national audit of what the EU does and what the implications are for this country. Extensive preparatory work is progressing, and when that is complete we shall make a further announcement to Parliament.
As for Syria, I see entirely the force of what the noble Lord has said about putting down a UN Security Council resolution. It is, of course, a delicate matter. I do not think that the issue has advanced as far as that, but the option must be open to the Security Council to put forward a resolution.
My Lords, is it not clear that the present situation in the eurozone is unsustainable, that it remains unsustainable despite the changes agreed with the European Council, and that sooner or later—sooner better than later—countries that are part of the monetary union will have to decide whether they are going to enter into a full-blooded political union or whether they should dissolve the single currency altogether? If the former, which I do not think it will be, there is no way this country can remain part of the European Union. If the latter, as I hope, and the single currency is dissolved, we can remain in the Union and I hope they will have learnt their lesson.
On the LIBOR scandal, I welcome a proposal to set up a Joint Committee of both Houses under the chairmanship of my excellent former special adviser. I am particularly glad that it will be a Joint Committee that includes Members from this House.
My Lords, on the first question, I do not know whether the eurozone is unsustainable. I do know that there is a crisis that needs to be resolved, and the sooner it is resolved the better. Our view is that at the end of last week a bold step was taken in the direction of trying to solve the crisis. Certainly, the financial markets liked it. Whether it is going to be enough, quickly enough, it is too early to tell. As the Government have said, there is a remorseless logic to how the eurozone operates, which is why we decided not to join it.
I am glad that my noble friend welcomes the Joint Committee on LIBOR and the banks. I think he is a member of the Economic Affairs Committee of this House, so he may well find himself a member of that Joint Committee, which would see a reversal of the roles between its chairman and him.
My Lords, could I clarify the Prime Minister’s position on an in/out referendum? My noble friend the Leader of the Opposition asked the question and the Minister did not seem to be clear in his answer. Is the Prime Minister’s position that he is opposed to an in/out referendum, full stop?
Could I also, I think, congratulate the Government? The Minister seemed to confirm what was reported in the Times last week, but which I did not see anywhere else, that the Government and the Prime Minister have agreed to give €1.3 billion to the European Investment Bank to help growth in Europe. It seems an odd thing to do, given that I would have thought that the Prime Minister’s primary consideration was to promote growth here. However, I would welcome such a proposition. Could the Minister confirm this?
First, my Lords, I thought I had made it pretty clear that the Prime Minister and the Government are not in favour of having an in/out referendum now. It is not the answer right now, but who knows? I would not support one, and I do not think that the Government would, because it is not the right choice to make. The right choice to make is that since Europe is in flux we should see where it ends up and where the relationship changes, if it does. We already have provision, agreed by Parliament, that when power moves from the United Kingdom to Europe there should be a referendum, so referendums should not concern us very much. However, if that relationship changes, perhaps the right thing should be to consult the British people, either in a general election or in a referendum.
As for growth, we were very much part of the group that called for a credible EU growth agenda. The European Council endorsed our growth priorities on Friday. For instance, we secured agreement for the immediate implementation of actions to eliminate unjustified barriers on services. This alone could add 1.6% to EU GDP over the next few years.
My Lords, is not the use of “growth” incredibly mistaken in the context not only of my noble friend’s Statement but of the European Council’s conclusions, which I have before me? Indeed, the first paragraph of the Council’s conclusions states:
“The European Union will continue to do everything necessary to put Europe back on the path of smart … and inclusive growth”.
Perhaps my noble friend can explain the difference between growth and “smart … and inclusive growth”. Furthermore, I would be very grateful to know precisely what the Prime Minister’s definition of growth is, because I have been confused in recent weeks by his understanding of it. Growth in the long term in the European Union can be sustainable only by continuing to liberalise every country within it and by introducing supply-side measures. If my noble friend agrees that the Prime Minister accepts this principle, can he please let us know what supply-side measures the Prime Minister has been trying to persuade his European colleagues to implement in recent weeks?
My Lords, I, too, read those words from the conclusions of the Council’s meeting, which say:
“on the path of smart, sustainable and inclusive growth”.
I suspect that in different countries within the EU, it means rather different things. The conclusions go on to say that it should provide,
“a coherent framework for action at national, EU and euro area levels, using all possible levers, instruments and policies”.
It then directs the reader to the annexe.
That leads me to my noble friend’s second question. I entirely agree with him that growth in Europe will come from sustaining, liberalising measures within the European economy. Again, we have been at the forefront of that by arguing for sound money, for spending European money better and more wisely, and wasting less of it, for decentralisation and for reducing bureaucracy. All these measures are the kind of things that have worked in the past and will work again.
My Lords, the Statement refers to the British rebate. If there are proposals for changes to Britain’s rebate, can the Leader of the House say whether they would they have to be agreed by veto or QMV? My second question concerns the growth arrangements that four countries agreed on before the summit. Will Britain be making a contribution to that and will it add to the £150 billion to which we are committed through the ECB and the European Investment Bank? Finally, does he agree with Dr Liam Fox that Britain should negotiate a new relationship with the European Union and, indeed, that,
“life outside the EU holds no terror”?
My Lords, on that last point, there is no proposal for the United Kingdom to leave the EU, so the whole question simply does not arise. No analysis has been made, nor is likely to be made, of what life would be outside, and my right honourable friend has no intention of proposing a referendum on whether we should be in or out of the EU. There are substantial benefits to our remaining a member.
Yes, we are committed to funding aspects of the European Investment Bank. Many of these have been debated and discussed in the past.
Finally, the British rebate is absolutely fundamental to our monetary relationship with the EU. We will not agree to giving it up. The noble Lord asked me whether, if it were to be changed, it would be under unanimity or under QMV. I think that I am right in saying that it would be under unanimity; if that is not the case, I shall write to him.
Does my noble friend accept that we will be more likely to get the rest of Europe to help us, and do the things that we want in terms of growth, if occasionally we emphasise the advantages of our membership instead of constantly suggesting that all sorts of things have to be changed? Will he please ask for a bit more positivity in our discussions about Europe?
There are many of us on all sides of the House who no doubt would like to be positive about the EU, but there a number of aspects to change over the course of the past 15 years that we do not believe should be dealt with at a European level; we would like to repatriate some of these things back to the United Kingdom. I know that my noble friend Lord Deben may not be entirely in agreement with all of that, but dare I say that when we have seen this audit of competences, there may be more agreement around the House as to what should be done at a national rather than a European level than seems to be the case at the moment?
My Lords, I have listened very carefully to the Leader’s explanation of the Prime Minister’s position on a referendum. I think that I am an average member of the public and I still have not got the faintest idea what his position on a referendum is. Does he seek a fundamental renegotiation of the terms and conditions of our membership of the European Union, which he would then like to put to the people in a referendum? In which case, I ask the Leader what shred of evidence his leader has from his prime ministership of two years’ standing that any other member of the European Union is prepared to agree to a fundamental renegotiation of Britain’s position within the European Union. Should he fail to get a fundamental renegotiation, will he then put that failure to the British public in a referendum? Presumably, his recommendation then would be that we should say no, and come out.
My Lords, I do not think that the noble Lord was trying to be helpful there at all. He was making his own case and asking questions on his own terms. The plain fact of the matter is that there is currently a fundamental reorganisation within Europe, a reappraisal of different relationships, particularly within the eurozone, which is inevitable, given the crisis that has engulfed the eurozone countries. It may, therefore, lead to a renegotiation; whether or not that is fundamental, it is too early to say. All that my right honourable friend the Prime Minister was saying is something that I think is glaringly obvious: if, under those circumstances, we wanted to change our relationship with Europe, and if that end point became clear, why on earth would we not wish to consult the British people, either in a referendum or at a general election?
Arrangement of Business
My Lords, in the 20 minutes that we have had for this European Council Statement, not a single female Member of this House apart from the noble Baroness, Lady Royall, was able to subject the Government to scrutiny. I therefore wonder whether the House will consent to hear me put a question to the noble Lord the Leader on the European Council. My question is to do with the banking union.
My Lords, the point is that the debate that we are now on is about whether or not the House should adjourn during pleasure for 10 minutes. I suspect that it is probably my fault that we are in this position. I said that the first Statement should not start before 4 pm; it started pretty much on the dot of 4 pm, and perhaps if we had delayed it for another 10 minutes we would have been able to continue without a gap at all. I am in a bit of a quandary because I would have hoped that the Statement in the Commons from the Chancellor of the Exchequer would have already begun.
Perhaps I could offer a potential solution to this. If, on the debate on whether the House should now adjourn during pleasure, the noble Baroness were allowed to make the point that she had not been able to put certain questions to the Leader of the House on the previous Statement and to explain to the House what those questions would have been, and perhaps the feminist dimension to them, and then the noble Lord the Leader were to answer that, we might even find ourselves in a happier position regarding the second Statement.
My Lords, I am extremely grateful to the House and to the noble Baroness, Lady Hayman, for coming up with that ingenious solution. My question would have been to do with the banking union and the lack of clarity about the relationship between the enhanced powers of the ECB, as it will be the banking regulator and supervisor, and the Bank of England, because significant issues of UK banking priorities would be affected by banking union. I wonder if the noble Lord might have been able to tell the House, had he had the opportunity, whether Section II of the report on EMU, which says that,
“Member States will be closely associated … and regularly consulted”,
would also apply not to the 17 countries that are not in the eurozone or the eight that are applying to be in the eurozone, but to those that are neither applicants nor in the eurozone in terms of the relationship between the banking authorities.
My Lords, if that is the question that my noble friend would have asked, perhaps I can crave the indulgence of the House in giving her the answer that I would have given if she had been within the 20 minutes for Back-Bench time. I am not entirely sure whether it makes a difference that we have not had a female Member of the House asking a question; I think that it is a wonderful thing that my noble friend has asked a question, but I would hate to be in a position where we reserved a certain amount of questions for either male or female Members. For my part, I think that the female Members of this House play a most valuable role, and in some debates rather a bigger role than some of the male Members.
My noble friend’s question was to do with the common regulatory regime for EU banks; in other words, what the relationship will be between the ECB in its new role in relation to regulators, supervisors and banks in non-eurozone countries. The euro countries have agreed to establish a single supervisory regime involving the ECB. Throughout this whole process, we have been entirely clear that the UK will not participate in that. The details need to be worked out over the coming months but we are very clear that any supervisor must not undermine the single market or UK financial services. The European Council has agreed that any proposals must include,
“concrete proposals on preserving the unity and integrity of the Single Market in financial services”.
I see that the Chief Whip has arrived on the Front Bench. We have an unusual convention that we repeat Statements and do not pre-empt them. I was rather hoping that the Prime Minister would have finished his Statement by now and that the Chancellor of the Exchequer would be on his feet. I wonder if it would be appropriate, even though we are still discussing this Motion as to whether or not we should adjourn for pleasure for 10 minutes—
I will try, as usual, to be helpful by saying a few words on this Motion about adjourning for pleasure. I do not think that we should. At least the Leader of the House was candid enough to confess that this timetabling was his mistake, but it is not the first mistake he has made in relation to the business of the House. In fact, in this instance, he is a serial offender. He ought to be very grateful to the noble Lords, Lord Hamilton and Lord Myners, to myself and others for insisting—and putting it to a Division, which was won, with the support of the Opposition—that the Committee stage of the Financial Services Bill be held on the Floor of the House. Given the events of the last few days, it would have been outrageous if it had been taking place in the Moses Room, hidden from public attention. Now, we can be sure that all of it, including the amendments, will be taken here on the Floor of the House.
When we have that debate, I hope that we will have, for once, the presence of the Minister of State at the Department of Trade and Industry, the noble Lord, Lord Green, who is never here, never answers Questions, never participates in debates and leaves it all to the poor noble Lord, Lord Sassoon, who does a wonderful job under the circumstances. It would be particularly helpful to have the noble Lord, Lord Green, here, because on 28 November 2005, it was announced that he was to become group executive chairman of HSBC. He has more knowledge from the time when all of this took place. He was chairman of one of the biggest banks and so can give us some inside information, if he is allowed to. I hope the Leader of the House will confirm—
I wish to be helpful to the House. It is also worth pointing out that the Minister, the noble Lord, Lord Green of Hurstpierpoint, was chairman of the British Bankers’ Association when these manipulations of the BBA’s LIBOR rate were taking place. It is reported that the executive of the BBA was aware that manipulation was taking place but took no action. How can this allow the noble Lord, Lord Green of Hurstpierpoint, to continue to be a credible adviser to the Chancellor of the Exchequer on banking, a role that he seems to have taken over from the poor noble Lord, Lord Sassoon, for whom we all have a great affection?
My Lords, I wish to apologise. I am grateful to my noble friend Lord Foulkes for bringing these issues to the attention of the House. We have had a very worthwhile discussion but I wish to place on record my thanks to the government Chief Whip. As I understand it, it was at the Opposition’s request that the Statement was promptly at 4 pm, for the convenience of some Members of my Benches and of the whole House. I do not wish to cast aspersions on the Leader of the House when, in fact, I should be the one taking the blame.
I am very grateful for that. I have very broad shoulders on these things, but it demonstrates that I made yet another mistake in giving way to the noble Lord, Lord Foulkes.
As for the noble Lord, Lord Myners, let everybody just remember what his role was in all this as a very senior Minister in the Treasury in the previous Government.
FSA Investigation into LIBOR
My Lords, I shall now repeat a Statement made by my right honourable friend the Chancellor of the Exchequer in another place. The Statement is as follows.
“Mr Speaker, on Thursday I updated the House on the Financial Services Authority’s investigation into Barclays and the attempted manipulation of the LIBOR market in the years running up to and during the crisis. The House has just heard from the Prime Minister, and I would like to give more details of the steps we are taking.
This morning, I spoke to Marcus Agius, who confirmed that he was resigning as chairman of Barclays because of the unacceptable standards of behaviour within the bank. The Treasury Select Committee is calling the chief executive of Barclays to account for himself and for his bank on Wednesday. I look forward to hearing his answers.
As I also said last week, every avenue of possible criminal investigations for individuals involved in attempted manipulation of LIBOR is being explored. However, in the view of its chairman, the noble Lord, Lord Turner of Ecchinswell, the powers that were given to the authority do not allow it to pursue criminal sanctions. People in the country ask why it did not have the necessary powers. Those who set up the tripartite system must answer for that. People ask whether these gaping holes in the existing law mean that no action at all is possible. After all, fraud is a crime in ordinary business; why should it not be so in banking? I agree with that sentiment, and I welcome the Serious Fraud Office’s confirmation that it is actively and urgently considering the evidence to see whether criminal charges can be brought, particularly in relation to the current Fraud Act and in relation to false accounting. It expects to come to a conclusion by the end of this month. We would encourage it to use every legal option available to it.
I would like to address three further issues today. First, what happens to the money we get from the fines; secondly, urgent changes to the regulation of LIBOR and other markets to prevent such abuse occurring again and to ensure the UK authorities have the powers they need to hold those responsible to account; and thirdly, the wider issue of what went so badly wrong in the culture of our banking system and the way it was regulated which allowed such fundamental failures of basic standards of conduct to go unchecked and unchallenged.
Last week, I said that we wanted to ensure that fines paid by the financial services industry in future go to the Exchequer. Today, I can confirm we will propose amendments to the Financial Services Bill in the autumn to make this happen. This will remove a long-standing anomaly and bring the regulator into line with regulators in other sectors of the economy. The new arrangement will apply to fines received from 1 April 2012 so that it includes the Barclays penalty. From now on, the multimillion pound fines paid by banks and others who break the rules will go to the benefit of the public, not to other banks.
That brings me to the second question of the urgent changes we need to make to the regulation of LIBOR to prevent this ever happening again and to ensure that in future authorities have the appropriate powers to prosecute those who engage in market abuse and manipulation. I have today asked Martin Wheatley, the chief executive designate of the Financial Conduct Authority, to review what reforms are required to the current framework for setting and governing LIBOR. This will include looking at whether participation in the setting of LIBOR should become a regulated activity, the feasibility of using of actual trade data to set the benchmark, and the transparency of the processes surrounding the setting and governance of LIBOR.
The review will also look at the adequacy of the UK’s current civil and criminal sanctioning powers with respect to financial misconduct and market abuse with regard to LIBOR. It will assess whether these considerations apply to other price-setting mechanisms in financial markets to ensure that these kinds of abuses cannot occur elsewhere in our financial system.
We need to get on with this and not spend years on navel-gazing when we know what has gone wrong. I am pleased to tell the House that Mr Wheatley has agreed to report this summer so that the Financial Services Bill currently before Parliament or the future legislation on banking reform can be amended to give our regulators the powers they clearly need.
The review is essential to ensuring that we mend the broken regulatory system introduced by the previous Government, which allowed these abuses to happen. But the manipulation of the most-used benchmark interest rate reveals that there is a broader issue of the professional standards and culture in some parts of the financial services industry that was allowed to grow up in the years before the crisis and which may still need change.
I do not think a long, costly public inquiry is the right answer. It would take months to set up and years to report. We know what went wrong. We cannot wait until 2015 or 2016 to fix it. In just six months’ time we will be bringing forward the banking reform Bill that will implement the recommendations of Sir John Vickers’s Independent Commission on Banking. This will bring far-reaching, lasting change to the structure of British banks, ring-fencing retail banks from their investment banking arms. Let us see whether we can use this banking Bill to make any further changes needed to the standards of the banking industry, and the criminal and civil powers needed to regulate it and hold people to account for their behaviour.
As the Prime Minister said, we propose that Parliament establishes an inquiry into professional standards in the banking industry. The Government will, in the coming days, lay before both Houses a Motion to establish a Joint Committee drawn from the Commons and the Lords. It should be chaired by the chair of the Treasury Select Committee, the honourable Member for Chichester. He and his committee have already been quick off the mark in investigating the issue, and we certainly await their hearings this week to proceed.
I propose that the terms of reference should be these: building on the Treasury Select Committee’s work and drawing on the conclusions of UK and international regulatory and competition investigations into the LIBOR rate-setting process, consider what lessons are to be learnt from them in relation to transparency, conflicts of interest, culture and the professional standards of the banking industry. I propose that it should be able to call witnesses under oath, including current Members of Parliament and Lords. I can confirm that we will provide the committee with the resources it needs to do the job. I would suggest to the House that we ask the Joint Committee to report by the end of this year, 2012. That is enough time to do the job—and to do it well—but not so long that this issue drags on for years, and it means, in very practical terms, that we can amend our banking Bill to take on board its recommendations.
I hope that all parties will support the Motion we put forward. The failure to regulate the banks in the boom years cost this country billions. The behaviour of some in the financial services has damaged the reputation of an industry that employs hundreds of thousands of people and is vital to the economic prosperity of the country.
We are changing the failure of regulation; reforming the banks. Now it is time to deal with the culture that flourished in the age of irresponsibility and hold those who allowed it to do so to account.
I commend this Statement to the House”.
My Lords, that concludes the Statement.
My Lords, I am most grateful to the noble Lord, Lord Sassoon, for repeating the Statement made by the Chancellor of the Exchequer in the other place. I welcome the content of the Statement as far as it goes, but it does not go far enough.
It is difficult to exaggerate the seriousness of the LIBOR scandal for three reasons. First, because of the manipulation of this key benchmark rate, a London standard recognised throughout the world has accordingly affected financial transactions worldwide, directly impacting on the financial well-being of millions of families and firms.
The Serious Fraud Office has powers to investigate and to bring prosecutions in cases of fraud defined as,
“an act of deception intended for personal gain”.
This includes publishing false information to mislead investors as well as fraudulent trading. I am no lawyer, but common-sense interpretation of those words would suggest that the people with whom we are dealing have indeed been practising deception for personal gain. But they are not simply persons with some sort of criminal bent; they have been moulded by the environment in which they work and by what is regarded as acceptable practice on a day-to-day basis—fine for the firms for which they work, just so long as they make money for them.
Secondly, their actions have done enormous damage to our financial services industry in general and to the City of London in particular. They have not merely undermined but blown up the City’s hard-earned reputation for integrity and fair dealing and, most of all, destroyed the trust without which no honest financial system can operate. Every honest firm should welcome effective regulation. I am sick of hearing that regulation limits the operations of free markets and that if legislation results in more effective regulation banks will leave the country. Now we know just how free those markets actually are. We should not be held to ransom.
Thirdly, the financial services industry is, I am afraid, an industry with form. In the same week as we learnt of the manipulation of LIBOR, we learnt of the mis-selling of interest rate swaps, following on from the PPI mis-selling scandal. As the Chancellor commented, all of this is on top of the irresponsible lending practices at home and abroad that brought about the international financial crisis—practices in which British banks played a leading role, inflicting huge economic costs on the British people.
In the light of those three factors, an inquiry should meet the following criteria. First, it must address the culture of banking and the financial services industry as a whole in relation to the internal organisation of industries and the regulatory framework in which they operate. Secondly, it must address the key question of the boundaries of civil and criminal culpability. Thirdly, it must fundamentally reassess the scope of regulated activities. The inquiries that have been announced today meet only one of those criteria—the second, on the boundaries of civil and criminal culpability. I am delighted to hear that Martin Wheatley will conduct a speedy investigation into the narrow issue of the setting of LIBOR and the related issues of criminal sanctions.
The proposal for the parliamentary inquiry fails on the following grounds. First, the scope of the terms of reference, although it sound quite broad, is in fact limited to the lessons learnt from,
“regulatory and competition investigations into the LIBOR”.
So it is just about the lessons learnt from that particular problem, not the broader issues of professional standards in the industry as a whole and the structure of the industry. Secondly, it fails to address the overall question of the scope of regulated activities. Thirdly, a parliamentary inquiry will fail to restore public trust by creating a national consensus about what has got to be done. I have great respect for the chairman of the Commons Treasury Select Committee, not least because of the excellent critique of the Financial Services Bill by his Select Committee. Let us note that the most important elements of that critique have been pointedly ignored by the Government. A parliamentary inquiry is bound to appear to the public to be too introverted—a closed, establishment shop to which they have limited access, working within terms of reference that are far too restrictive. That is why there must be a full public inquiry that addresses all the issues at stake. As the Chancellor said, we know what has gone wrong. Yes, indeed, we do—but, at the most fundamental level, we do not know why or how.
I quite understand the argument that a proper inquiry might take too much time, but that can be easily dealt with by instructing the public inquiry to deal with issues sequentially. After Mr Wheatley’s report there could be an interim report on the immediate LIBOR issue, described in the terms of reference for the parliamentary committee. Following on from that, a much more considered report on corporate failings in compliance, culture, governance and organisation throughout financial services is the only full answer to the question: why did this happen? We owe the honest, committed people in the financial services industry that inquiry to lift the cloud that will otherwise hang over them.
The development of the financial services industry in this country has been guided by great public inquiries: the Macmillan Committee in the 1930s and the Radcliffe Committee in 1958 produced landmark reports. Now is the time for another. The reforms of the 1980s, while bringing many benefits, have had potentially disastrous, unintended consequences. There is a need for fundamental reform to the structure, style and content of the financial services industry to provide a framework for successful development in the future.
The Government have been bold in establishing the Vickers inquiry and bringing forward the current proposals and they deserve credit for that. However, the current proposal for a parliamentary inquiry, I regretfully say, by its very limitations—and especially the limitations of the terms of reference—can only do harm.
I should like to ask the Minister a couple of brief questions. First, why have the Government limited the scope to lessons drawn from international regulatory and competition investigations into the LIBOR rate-setting process? Why does it not go wider? Secondly, when did the Treasury first know of the substance of the FSA inquiry into LIBOR-fixing at Barclays?
My Lords, I am grateful for the welcome that the noble Lord, Lord Eatwell, gave to the Statement. However, I am sorry that he thinks that the immediate action that the Government have taken is not appropriate and that he would like it to go further.
I cannot think of a better way of getting a national consensus and getting rapidly to the heart of these issues than through a Joint Committee of the two Houses—not least because, as we saw two weeks ago in the Second Reading of the Financial Services Bill, there is extraordinary and relevant expertise that can be brought to bear from this House alone. There was a remarkable debate on that Bill in which two former Chancellors, three former Treasury Permanent Secretaries, former members of the Court of the Bank of England, other former Treasury Ministers and leading financial journalists all spoke. We should not undersell the great expertise that can be brought to bear through the Joint Committee, which will have public hearings and be able to call, under oath, whomever it chooses to call. I do not agree with the noble Lord that we should go through some other route.
I remind your Lordships that recent public inquiries and those that are still live have taken an extraordinary amount of time and cost a huge amount of public money. Leveson, established in July 2011, has so far cost £2.8 million; Baha Mousa, started in May 2008, ran for more than three years at a cost of £13 million; the Mid-Staffs inquiry started in June 2010 and is still running—it is nearly finished—and so far has cost £11.8 million. These are expensive and long inquiries. For the safety and good order of our financial services markets, we need to get on with the inquiry and a Joint Committee is the appropriate way to do so.
The proposed terms of reference will come back to your Lordships’ House via a Motion that will go through both Houses. I do not read them as being limited in the way that the noble Lord, Lord Eatwell, seeks to limit them. The proposed terms of reference refer to drawing on and building on both the Treasury Select Committee’s work and the conclusions of the UK and international regulatory and competition investigations into the LIBOR rate-setting process. Then I read what follows, which states,
“consider what lessons are to be learnt from them in relation to transparency”—
that is LIBOR and the work of the Treasury Select Committee—
“conflicts of interest, culture and the professional standards of the banking industry”.
I read that as the committee being able to go extremely wide in its investigation and I am sure that it will do so. I certainly do not believe that there is a problem of the sort identified by the noble Lord.
As to when the Treasury first knew about the substance of the LIBOR-fixing allegations and investigation at Barclays, naturally Treasury officials have been in contact with the FSA during its investigations to consider LIBOR policy as it is in contact with FSA officials about many other things that they do. As was the case under the previous Government, it would be inappropriate to disclose the details of meetings while this is an area of developing policy.
My Lords, I said last week that there was public outrage, and that outrage has only been growing. Mr Diamond remains in post; he just does not get it. That now raises questions about the fitness of Barclays’ board, which also just does not get it. Does the Minister agree that this matters? I very much welcome the review that Martin Wheatley will lead. Whatever changes are made to the rate-setting of LIBOR will always depend on engagement with the major banks. Therefore, there must be confidence that the banks fully understand their role in providing that information.
The other area of outrage, as I recognise it, is the perceived impotence of the FSA in being able to pursue sanctions for activities that are so widespread that, according to the Telegraph, they have their own technical term—the,
“dislocation of Libor from itself”.
Will the Minister explain why there is no scope under Clauses 397 and 400 of FiSMA, which I can quote if he wishes, to pursue individuals and the officers who supervise them? Surely an amendment could be put into the Financial Services Bill. It would be welcome if there was any way for it to be retrospective. Can he also explain why it was the CFTC in the United States that jumped on the issue in May 2008, based on information from whistleblowers, whereas with the same information the FSA did not become engaged until 2010? Obviously, I am dependent on media reports. Can we please look at the powers, resources and capacity of the FSA to ensure that it is never again in such a position?
My Lords, first, I will not comment further on the senior executives of Barclays. Clearly the chief executive is coming before the Treasury Committee later this week and will be asked a lot of questions that will further elucidate those aspects.
On the question of prosecution, the basic flaw is that the setting of LIBOR was not and is not a regulated activity, so the FSA does not have a direct way in. My noble friend is right to be quizzical and shake her head but that is the position as it was under FiSMA and the construct put in place by the previous Government. If the FSA wanted to bring criminal prosecutions, as it has done with the civil settlement, the attempted fixing of LIBOR is an activity that is ancillary to a regulated activity. The construct is difficult and the chairman of the FSA has pointed out the difficulties.
As I said in repeating my right honourable friend’s Statement, most normal people would assume that there was a prima facie case to look at the Fraud Act and false accounting and that is precisely what the SFO was doing. Through the inquiries that are going on, we will look at what needs to be done to plug gaps in the financial services legislation. For the avoidance of doubt, I should tell my noble friend that there will certainly be no retrospective legislation in respect of criminal action because—before anybody else jumps up—it would be against the European Convention on Human Rights. I am sure that my noble friend would not want us to go there—and she acknowledges that.
As to which regulator started work when, I would not rely too much on what the newspapers say. As with all these things, I am sure that in due course the regulators will look into their conduct and the lessons to be learnt. I certainly would not take as gospel the newspaper reports of who started when.
My Lords, the Minister is obviously aware that this has not just started. It has been going on for years and it could not have involved only Barclays but virtually every major bank, not only in the UK but elsewhere. Barclays could not have been handling this on its own. Listening yesterday to the chairman of the FSA, the noble Lord, Lord Turner—who unfortunately is not in his place—the FSA knew nothing whatever about it, nobody in the Bank of England seems to have known anything about it, and now the noble Lord, Lord Sassoon, tells us that the Treasury has known about it apparently for only a short while. We obviously recognise that to be the truth, but should there not be criticism of some of the people involved here? The sheer incompetence of not knowing anything about it deserves some kind of criticism.
I appreciate that the Minister cannot say that he will listen and change anything, because it is a matter for the Chancellor. However, my noble friend Lord Eatwell put a lot of serious points to him and I hope that he will take them back to the Chancellor to ensure that there are some changes. There should be some changes now.
My Lords, first, as we discussed last week, there are a significant number of other banks under investigation. Secondly, we could debate the history of this for a very long time, but this Government are moving extremely fast on a number of fronts to plug the gaps through one or both of the pieces of legislation that are or will shortly be before Parliament. We need to get this right, which is what we are doing.
My Lords, could I ask about the statement that the FSO will begin to consider criminal charges in the next month? I follow the noble Baroness, Lady Kramer, in referring to the level of outrage in the country about these events. The SFO could announce today that it is launching a criminal investigation. It is about not criminal charges but a criminal investigation into conspiracy to defraud, because if this is not a conspiracy to defraud, then I have never seen one—and I have seen a few.
My Lords, unlike the noble Lord, Lord Eatwell, I see much merit in a parliamentary inquiry, especially if, as has been suggested, it includes people of the talent and experience of my noble friend Lord Lawson. There are many from all sides in this House who can do this. It is an inquiry that needs, above all, practitioners and people from the financial world rather than lawyers, and it does not prevent further inquiries in due course.
However, four points of action were put forward by the Prime Minister under the heading of banking in his Statement. Three of them are quite clearly covered by the Chancellor’s Statement but one is not. That is a confusing matter and I would like enlightenment. In the four actions proposed by the Prime Minister, one was,
“increasing the taxes banks must pay”.
What was the Prime Minister referring to?
I am grateful to my noble friend for confirming that a Joint Committee is the way to take this forward. We have already increased the tax on the banks by putting a special levy on them so that the big banks effectively do not take any advantage of the lowering of corporation tax, which other parts of industry have already benefited from. This tax on the banks is enduring and will raise far more than the one-off tax that the previous Government brought in. So we have already done that.
My Lords, I broadly welcome the Chancellor of the Exchequer’s Statement, and in particular the appointment of a Joint Committee, the report to be produced by Mr Martin Wheatley and the timetable to which both those reports are working.
I would like to return to the point I made to your Lordships’ House earlier about the BBA. It is increasingly clear that the British Bankers’ Association was very aware of what was going on—the collusion that was leading to fraud. The chairman of the BBA at that time is now a Minister in Her Majesty’s Government. Will the Minister assure us that the work being done by Mr Wheatley will look at the BBA’s role? It appears that there is a prima facie case that the BBA colluded in and supported a corrupt act. I am grateful that the Minister and the Chancellor have confirmed that there is no lacuna in legislation that prohibits criminal prosecution of the quite monstrous things that appear to have occurred here.
I have two further short questions. There was no suggestion by the Minister that any action would take place to lead to an inquiry and the payment of compensation to those who lost out as a result of this systemic collusion and manipulation of an important rate. That includes taxpayers, because there were a number of arrangements between the central bank, the Treasury and banks that were based on the LIBOR rate. Will the Minister confirm that there will be an appropriate investigation about whether the taxpayer was disadvantaged? Finally, will the Minister explain why the FSA’s fine was so small compared with the fines imposed by the American regulators?
My Lords, on the first point, presumably if there is evidence that the BBA colluded in criminal activity, that will be well within the scope of the work that the SFO might do. As for the wider question about the role of the BBA, the review of LIBOR will look comprehensively at governance, which comes very much back to the BBA role and what, if any, that should be in the future framework.
On the question of whether there should be compensation, our difficulty at the moment is that we do not know whether LIBOR was successfully manipulated as opposed to there being an attempt to manipulate it. From the evidence that has already been made public, we know—
My Lords, if the noble Lord will hear me out, we know that there was attempted manipulation from the evidence that has already been made public. I do not know on what basis the American authorities have come to that conclusion, and it may just be semantics, but the authorities are currently investigating whether LIBOR was actually manipulated.
It is also worth bearing in mind that, in the case of Barclays, it was the dollar LIBOR rate and not the sterling LIBOR rate that was the subject of the attempted manipulation that has come out. I completely agree with the noble Lord, Lord Myners, that these investigations need to carry on, but we cannot come to any conclusion about the answer.
Lastly, I answered a question about the fine last week, but I will repeat it in summary. This is the largest fine that the FSA has ever handed down, which indicates the seriousness of this matter within a UK context—the US has a completely different approach to the way it imposes penalties. The most important and relevant point is that this is the largest ever fine in the UK handed down by the FSA.
My Lords, if I may, I will make a point in support of the very pertinent submission made by the noble Baroness, Lady Kramer. This is not a question of who should prosecute or who can prosecute. A simple, straightforward criminal offence was created in Section 397 of the Financial Services and Markets Act 2000; I checked it. That provision deals with a false statement or declaration that is made deliberately or misleadingly and that distorts a market. It is an offence that is punishable on indictment with a maximum of two years’ imprisonment. There would seem to be ample prima facie evidence that such an offence has been committed. In the circumstances, bearing in mind the damage done and the ruthlessness with which such practices were conducted, is there any reason why persons responsible should not stand trial?
My Lords, I am sure that the FSA will listen to the analysis given by the noble Lord, Lord Elystan-Morgan; and if it has not already got to the bottom of it, it will take his points on board. The authority is acutely aware that it needs to press on, but the noble Lord, Lord Turner of Ecchinswell, has made it clear that it is very difficult, which is why the FSA seems to be taking the lead on this.
My Lords, it would seem that Barclays’ defence is, “We had to cheat in order to preserve our reputation”. That suggests that the bank is seriously misguided in the way it looks at these matters. Certainly there is a case for a parliamentary investigation, which I support. It is equally true that we should be absolutely clear that the terms of reference are the right ones for such an investigation.
If I may, I will make a very narrow point. As I understand it, the proposal is that the Joint Committee should be chaired by the Member for Chichester, Mr Tyrie, for whom I have the very greatest respect. However, as I was myself chairman of the Treasury Committee for some 14 years, I question whether it is appropriate that his energies should be diverted from the Treasury Committee, where he is doing an excellent job, by being chairman of this authority. This is too heavy a burden for one person, however talented, to take on, and we ought to consider that point.
My Lords, on my noble friend Lord Higgins’ first point, there were two distinct periods during which Barclays was found to have attempted its manipulation. The first period was before the financial crisis, when its traders appear to have been driven by pure greed and tried to drive rate up. The second period was during the financial crisis when the preservation of Barclays’ reputation seemed to be the main driver and it was attempting, it seems, to move the interest rate down. I think there were those two distinct motivations.
Regarding the committee chair, notwithstanding the suggestion that the chair of the Treasury Committee chairs the Select Committee, I would guess that the formal position is that the committee itself will decide who the chair will be. I imagine that this will be taken up either in the Motion itself, in which case your Lordships will have a chance to take a view on it, or the committee will decide who the chair will be in due course.
My Lords, I want to pursue for a moment the sheer seriousness of the situation that the noble Lords, Lord Eatwell and Lord Blair, and my noble friend all pointed to. I can think of nothing more likely to undo the prospect of this country’s return to prosperity from the crisis than the present, huge doubts about the trustworthiness of the financial system. When I extensively read newspapers from the United States, what comes out very loud and clear is the view that as a result the major beneficiaries will be countries that are in direct rivalry and competition with the City and that hope to gain from what they regard as an extremely dangerous problem that we have brought upon ourselves.
I am satisfied with the prospect of a parliamentary inquiry and I accept what the noble Lord said about the necessity for speed and getting on with it. The noble Lord, Lord Eatwell, and my noble friend Lord Higgins asked about the terms of reference. The missing term of reference that troubles me is the inquiry’s relationship to the role of the regulators. The Daily Telegraph may not be a very good source, but it is becoming completely clear that there were seminars, discussions, meetings and debates throughout 2007 and 2008 about LIBOR, and if anything is likely to be true about those rumours and suggestions it is vital that we explore whether our present regulatory structure is adequate to deal with an issue as serious and as far-reaching as this one. I therefore, with great respect, suggest to the Minister, probably with the support of the Opposition, that the terms of reference should at least extend to the roles of regulators, to the reasons why they failed to probe into this matter at an earlier stage and to what steps could now be taken to give them the confidence and the resources to enable them to do better in future.
My Lords, I certainly agree with my noble friend that these are all relevant and important questions. It is equally important that the proposed Joint Committee’s terms of reference should be clear and should focus on transparency, culture and professional standards. The role of the regulators is rather different, but I am sure that the Treasury Select Committee, in the normal course of its business, will want to ask questions about those matters in due course. However, I take on board what my noble friend has to say.
Crime and Courts Bill [HL]
Committee (5th Day (Continued))
Schedule 13, as amended, agreed.
Clause 20 : Payment of fines and other sums
Amendment 147 (formerly numbered 77)
147: Clause 20, page 17, line 23, at end insert—
“( ) In fixing such an amount, and subsequent additions, account must be taken of the person’s relevant weekly income, excluding housing benefit and child benefit, and allowance must be made for the protection of a reasonable financial subsistence level, in the manner used to determine the initial fine.”
My Lords, this amendment will extend the means-testing system currently used in the calculation of court fines so that it also applies to the calculation of additional costs which, under Clause 20, will be imposed on people as a result of late or incomplete fine repayments.
The rationale behind means-testing in the justice system is laid out clearly in the magistrates’ court sentencing guidelines, which make clear that while financial punishments should cause a degree of hardship, they should not force people below an income level required to meet their most basic needs. Furthermore, they should impact equally upon offenders regardless of their financial situation. On this basis, fines are set as a percentage of the offender’s relevant weekly income, minus child benefit and housing benefit.
However, as the Bill now stands, those who miss payments for whatever reason will be liable for extra costs that take no account of their means at all. Consequently they may be left owing significant sums that they simply cannot afford, even being forced to cover repayments using benefits that were protected in the calculation of the initial fine.
This has raised serious and urgent concerns among charities and others working with vulnerable individuals and families. The Catholic Children’s Society in Westminster has said that imposing costs on parents without taking account of their financial means presents a serious risk to their children. It states:
“Child benefit exists to support children’s basic needs and is quite rightly excluded from the calculation of fines … It would be iniquitous to undermine this by adding further non means-tested costs that could jeopardise children’s wellbeing … Ultimately, under the government proposals children will suffer because of their parent’s inability or failure to meet payment deadlines. This is neither a just nor acceptable situation”.
If the current system of means-testing is applied to the new financial penalties outlined in the Bill, such a situation can easily be averted. Offenders with dependent children will still be penalised for not meeting fine payments in full or on time, but the sanction will protect the amount required for meeting those children’s essential needs. Similarly, all those required to make extra payments, regardless of their family situation, will maintain the basic amount needed to cover fundamental costs such as food and housing.
It should be emphasised that, with basic subsistence levels being accounted for in this manner, the Government’s aims of incentivising timely payment and reducing the cost of recovering fines will not be undermined. In fact, with means-tested amounts as opposed to arbitrary or standard sums being imposed, repayment may be more likely, as people will be subject to payments that they can realistically meet rather than face mounting debts that they may have no real chance of ever paying off. Equally, by maintaining safeguards against forcing people into unsustainable financial situations, the public purse will be protected from potentially significant expenses in the long term.
In response to the points that I made at Second Reading, the Minister, the noble Lord, Lord McNally, said that,
“if the offender provides accurate means information at the outset of their engagement with the justice system and keeps to the payment plan set out by the court, enforcement action will not take place”.—[Official Report, 28/5/12; col. 1067.]
However, as those working on the front line know only too well, in reality a whole array of circumstances prevent people keeping to their payment plans.
I welcome recent government pilot schemes to aid compliance such as text-messaging reminders when payments are due, but these will not provide a universal fail-safe against offenders defaulting on amounts owed, nor are they intended to do so. As I have previously stressed, people should face up to their financial responsibilities and should not be exempt from covering any extra costs that the Courts and Tribunals Service incurs as a result of their deviation from their agreed payment plan. However, the principles of equality and basic subsistence that underpin other financial penalties must apply here. I hope, therefore, that the Minister will take that on board and consider extending the current means-testing system to apply to the new financial penalties as outlined in the Bill. I beg to move.
My Lords, I support the amendment proposed by the noble Lord, Lord Touhig. Clause 20 as I understand it writes new Section 75A into the Magistrates’ Courts Act 1980. Under that new section, the costs incurred in the collection of a fine should be added to it. No discretion is given to a magistrates’ court, once the machinery has commenced, to decide whether to make an order. The Bill states quite baldly that those costs shall be added. There is no question, therefore, of a court saying, “Well, in the circumstances, we do not think that it would be appropriate to make an order here”. Once those basic facts have been proven, the machinery runs in a way that is less than fair.
The principles relating to a fine are well known, not only to magistrates’ courts but to the Crown Court as well. For a fine to be appropriate in the circumstances, it should be a reasonable disposal in the light of the offence committed and should, by its size, be a reasonable order in the light of the all the relevant circumstances. All the relevant circumstances, to my mind, would include the three main provisions that are incorporated in the noble Lord’s amendment. It may be, and is so in many cases, that a person will not pay a fine because he is contumelious. He challenges the court and says, “They’ll have to drag it out of me”, and it is like taking blood out of a stone. It may on the other hand be that there has been such a change in circumstances since the fine order was made that it is impossible for that person to contribute. Between those two extremes, all manner of possibilities are true.
I have no doubt that any reasonable magistrates’ court looking at the situation would inevitably take into account those three elements spelt out in the amendment, if it was doing its duty, as I am sure it would do. What is wrong therefore in spelling them out at this stage, especially since Clause 20 is drawn in such wide terms? It would mean that, once that sum of money had been added to the fine, all the sanctions which would have been appropriate in relation to the fine would be relevant in relation to the added amount.
My Lords, I support my noble friend Lord Touhig in the detail of what he is proposing. I agree that when costs are added they should be means-tested as were the original fines when they were put in place.
I want to raise a separate issue which I raised also at Second Reading, and this is probably the best amendment with which to do so. When magistrates impose new fines, they very often do not know the level of the outstanding fines. It is not unusual for a magistrates’ court to go through hundreds of cases in a day when they are dealing with small matters and to put on hundreds of fines. They will never know, in my experience, what the level of outstanding fines is. This is clearly unsatisfactory because it can, and in many cases does, force people into an unstable financial situation. If the courts had known the level of the outstanding fines, they might have looked at other sentencing alternatives which were more appropriate for the person who is unable to pay their fines.
I have raised this issue with colleagues who are magistrates. It is feared that, if this provision were made mandatory, the administrative procedures would be brought to their knees because, as I said, literally hundreds of fines can go through in a single sitting. The administrative system should be set up so that magistrates and judges can get information on the level of outstanding fines in reasonable time before they go ahead and sentence. As I said, this is a slightly different matter from the burden of the amendment, but it goes to the heart of practicality of imposing fines.
My Lords, in speaking to my noble friend’s amendment, I shall deal also with my opposition to the question that the clause stand part. Before I do so, I am sure that your Lordships would wish to join me in extending to the noble and learned Lord, Lord Mackay of Clashfern, who is not in his place today, congratulations on his 85th birthday. It would be good to see that in the record of the House.
I support the amendment moved by my noble friend Lord Touhig and have little to add to it, save that the Minister will have received a letter from Mr Paul Nicolson of the Zacchaeus Trust which was sent to my noble friend and copied to a number of your Lordships. It illustrates the nature of the problem that my noble friend has addressed, but with particular reference to the outsourcing of the collections enforcements system under Clause 20(2). This proposes an amendment to the Magistrates’ Courts Act which prescribes that:
“All functions of fines officers may be contracted-out”;
my opposition to stand part refers to this.
Mr Nicolson’s letter sets out a case for doing that. The amendment went down before I had heard from him, so we were of a like mind without knowing it at the time. One of the concerns that he expresses—which has been touched on by my noble friend—is that the cost of enforcement is likely to rise significantly to the extent that it is contracted out: courts officers do not, of course, charge the same amounts as bailiffs. The Minister will have seen from Mr Nicolson’s calculations that whereas court costs and a fine officer might add £135 to a fine of around £200, where bailiffs are involved, that figure could rise very substantially indeed because they charge a great deal more. I will be moving an amendment in relation to bailiffs a little later.
The letter suggests that the privatisation, if you will, of enforcement is likely to aggravate the problem. It says that contrary to the Government’s view—and I do not know if the Minister will be able to comment on this—
“fines officers do make judicial decisions”.
If they were privatised, that would be effectively privatising an element of judicial discretion. The letter goes on to say that, at present:
“The magistrates will set the level of the fine and then issue a collection order. It is then the fines officers’ duty to collect the fine. They decide: a) the weekly/monthly level of payment; b) whether it should be changed if there has been a change of circumstances; c) to send out bailiffs to defaulters”,
“d) whether to send the case to the magistrates for reconsideration”,
if it is found that the defaulter is vulnerable or the fine is disproportionate and should be reconsidered.
Mr Nicolson supposes that the Government will argue that these are purely administrative tasks; I do not know whether the Minister will be advancing that argument. However, from his point of view, and I guess that of the Zacchaeus Trust, these are effectively part of the judicial functions of the court and should not be privatised, with all the additional costs to defaulters that that would involve.
I therefore support the amendment. My opposition to clause stand part is designed to invite the Government to explain the rationale for further contracting-out of this function, how it might operate, and to what extent it is expected that this service will be privatised and at what cost to the public purse and to debtors. I hope that the Government will perhaps reconsider this. We may otherwise have to revert to it at Report. It seems a step too far in terms both of the burdens it will impose, and of the principle of contracting out a significant role like this beyond the court system.
My Lords, I thank the noble Lord, Lord Beecham, on behalf of my noble and learned friend Lord Mackay. The age of 85 is indeed the new 65, as he clearly manifests. I also thank the noble Lord, Lord Touhig, for his amendment.
Clause 20 enables the costs of collecting or pursuing unpaid fines to be recovered directly from the defaulting offender and ensures that there are strong incentives for offenders to pay fines promptly. Ultimately, collection costs, as the noble Lord has outlined, will be added directly to an offender’s fine if the offender fails to pay the fine to the agreed timetable and costs are occurred in pursuing payment.
Once a person has failed to pay their fine, much of the work that goes into pursuing that fine clearly involves labour intensive processes; for example, sending reminder letters, tracing offenders, validating offender information or arranging deductions from benefits or earnings. It cannot be right that a proportion of offenders do not pay their criminal fines in full or in a timely manner. This undermines the effectiveness of fines as a criminal punishment and costs millions of pounds per year to pursue. It cannot be right that the taxpayer should have to pick up the costs of pursuing unpaid fines from some.
We recognise that we must, of course, make allowances for the fact that some offenders lead chaotic lives and are vulnerable. Therefore, these costs will not apply to those who pay as ordered or who remain in contact with the court and comply with their payments plans which fines officers are more than willing to set up for those offenders struggling to pay their fine. This clause is aimed at those who deliberately evade payment.
We understand the concerns of the noble Lord, Lord Touhig, in this matter. Clearly we must make allowances for the fact that some people find themselves in hardship and find it difficult to pay their debts. That does not mean that the courts ought to permit those convicted simply to ignore the sentence imposed on them. Fines are a criminal sentence and taxpayers should not be subsidising those who avoid payment for whatever reason. If a person is vulnerable or is having difficulty paying their financial penalty, this needs to be discussed with the fines officer.
Under the fines collection scheme, much of the work of managing the payment of fines is the responsibility of the fines officer. Fines officers can arrange more manageable payment terms with offenders who have not defaulted and provide a key link between the offender and the court to ensure that the fine is paid as ordered by the court. Fines officers can also provide advice to offenders to help them understand what has been ordered by the court and can explain the implications of default. This includes advice on where offenders can get help with managing their finances where that is needed.
Indeed, as my noble friend Lord McNally said at Second Reading,
“if the offender provides accurate means information at the outset of their engagement with the justice system and keeps to the payment plan set out by the court, enforcement action will not take place”.—[Official Report, 28/5/12; col. 1067.]
Hence, no additional cost will be incurred. We really cannot emphasise strongly enough the need for offenders, especially those considered to be vulnerable, to keep in continuous engagement with the fines officers. In addition, if on experiencing financial hardship a person wishes to appeal or to be referred back to the court, the court will have the discretion to remit part or all of the administration costs following consideration of all the issues.
In setting the level of fine, it is the judicial responsibility of the court itself to evaluate the circumstances and seriousness of the offence against the financial means of the offenders. Under Clause 20, it is proposed that the administrative costs will be fixed and proportionate to the actual costs of collection, and will be applied where there is default in payment after sentencing. It would not be appropriate to give the fines officer the ability to exercise a judicial discretion when setting the level of costs in the same way as is done for fines.
Following sentencing, where a person’s financial information has not been supplied or verified, fines officers and administrative staff set about trying to engage with the offender, gathering further information, such as whether the person is in receipt of benefits, and verifying the person’s income and other details. Fines officers can then assess the best approach to assist the offender and enable payment. Our aim in the future is significantly to improve the level of information that a court has in order to fix the fine at an appropriate level in the first instance. That is an important step in ensuring that fines are more manageable for those in hardship while remaining an effective punishment for committing a criminal offence.
The noble Lords, Lord Elystan-Morgan and Lord Touhig, asked about a person’s right to appeal the decision. The court will be able to remit part or all of the collection costs under Section 85 of the Magistrates’ Courts Act 1980. If a person wishes to appeal the fines officer’s decision, perhaps on the grounds of vulnerability or incorrect financial information which has led to a substantially higher penalty which the person cannot pay, the fines officer can at any stage refer the case back to the magistrates’ court. At that point, the court can review the original sentence and/or collection costs which have subsequently been imposed by the fines officer. I hope that that reassures noble Lords.
The noble Lord, Lord Beecham, flagged up the point about the judicial or other role of the fines officer in response to briefing that he had received. Choosing the sanctions or collection method is not a judicial function. It has been performed by administrative staff since the Courts Act 2003 fines collection scheme was introduced in 2006. It is governed by regulations subject to authorisation by the Lord Chancellor. As long as the Lord Chancellor has authorised the collector to make such decisions, it is an administrative task to ensure that the penalty imposed by the court is complied with as far as possible. The fines officer tries to assist in carrying out what the court has decided. The court makes the decision on what the fine should be.
The noble Lord, Lord Beecham, also asked about privatisation. Our aim in all this is to increase the number of people who comply with their court-ordered fine and reduce the need for courts to use compliance actions, such as bailiffs. Our future strategy looks to increase the number of people who fall into that category. Fines officers are obviously extremely important in trying to ensure that whatever the court has decided is complied with. They can vary payment plans or arrange for money to be automatically deducted from benefits or earnings, but that can be done only if the offender gets in touch with the fines officer so that those issues are addressed early on.
We are satisfied that the combination of the powers available to the court to remit part or all of the costs and those at the disposal of the fines officer in Schedule 5 to the Courts Act 2003—for example, the power to vary payments or set up deductions in the way that I have suggested—are adequate for the purposes of assisting those offenders who find themselves in financial hardship and provide enough recourse for those who want to challenge the decision. We do not believe that those powers need to be extended to provide judicial discretion for fines officers to means-test the administrative costs.
I hope that, in the light of those explanations, the noble Lord will be prepared to withdraw his amendment.
In theory, I suppose that that could be the case. The important issue here is that the offender stays closely in touch with the fines officer. If an offender has a very small fine decided because of their circumstances, ways to pay that should be sorted out and the offender assisted in that regard. Only a very small fine would be overtaken by the cost of pursuing it, one would imagine. As I said, it is extremely important for the offender and the fines officer to work through the implications of the decision taken by the court.
My Lords, I must say that I am somewhat disappointed by the Minister’s response. I entirely agree—I said it at Second Reading and I have said it today—that people should be responsible for paying the debts that are due. If they are fined for an offence, they should be responsible for paying those debts. However, as the Minister said, people often live chaotic lifestyles. We think that it is right that the guidelines of a magistrates’ court make it clear that, although the fine should provide a degree of hardship, it should not leave people with an income on which they cannot survive. Surely we should protect children and the person’s ability to pay for food and housing. Those are three basic things: children, food and housing.
I remind the noble Lord that I said that, if offenders find themselves in the circumstances that he describes, they can go back to the court and the administration cost, too, can be varied or set aside. It is not as cast-iron or concrete as the noble Lord suggests.
I apologise. I accept the point that the noble Baroness made in her earlier response. The point I seek to make is that if we think that the guidelines to the magistrates should take account of those elements, surely it is right that any additional fine should take account of those elements. At the end of the day, because of the lifestyles of some people, some fines will never be paid. That is wrong, but they will not. The taxpayer will end up paying more if children are not properly cared for. Social services will be involved. Someone will lose a house and have to go into emergency accommodation. The Government are storing up a problem here which could be avoided by simply saying, yes, if a form of means testing is used to determine the initial fine, any additional fine should have the same application.
I regret that the Government do not see it that way. There is clearly much work that we must do as missionaries to persuade the Government, before the Bill passes, of the error of their ways. With those few remarks, I beg leave to withdraw the amendment, but give notice that I shall come back to it at a later stage.
Amendment 147 withdrawn.
147ZA: Clause 20, page 17, line 41, at end insert—
“75B Minimum size of charging order
The Secretary of State shall by regulation prescribe the minimum amount above which a charging order may be granted in respect of a judgment debt, which shall be laid before, and approved by a resolution of, each House of Parliament.”
This is a probing amendment dealing with the question of charging orders. Creditors may seek to obtain a charging order against the assets of a judgment debtor, including his or her home, and that can lead to an order for sale. In 2009-10, 566 such orders were obtained.
The Government have been consulting on a proposal to impose a financial threshold below which such action could not be taken in respect of unsecured debts, particularly in relation to consumer credit cases, where the debtor is in fact already paying a premium for the loan through higher interest rates affecting the risk to the creditor.
The whole process began with a report from Citizens Advice in 2009 called Out Of Order, which recommended just such a threshold and which led to the previous Government publishing a consultation paper in February 2010. That was followed in March 2010 by an OFT publication entitled Irresponsible Lending Guidance—in itself an admission of the seriousness of the problem. The key guidance called on creditors to make it clear that charging orders might be obtained which could lead to the sale of the property charged and therefore to the loss of the home at the time of the entry into the consumer credit agreement. It also, significantly, warned creditors not to harass or threaten debtors with the loss of the home if they did not in fact intend to enforce such an order. This, of course, underlines the fact that the problem is not just a financial one, but also encompasses the anxiety and stress caused to debtors and their families. As the evidence base for the recent consultation points out:
“In considering whether to make an order for sale, the court will balance, against the rights of the creditor to recover the debt, the rights of the debtor and his/her family in respect of the family home under Article 8 of the European Convention on Human Right … in all cases judicial discretion will be exercised”.
While the latter point is true, it is unlikely to assuage debtors’ fears of losing the family home pending a hearing and a judicial determination.
At present, the information about the number of relevant cases is limited. It would be reasonable to infer that in the past two years numbers will have risen in light of the recession—the “Breadline Britain” so poignantly portrayed in the recent Guardian series. However, the figures rely on monthly returns from individual county courts, so again in the words of the evidence base, there is “scope for collection error” in the statistics, both as to the total numbers and whether they are ultimately enforced. There is still less information about the cost to the public purse of the consequences of people losing their homes—for example, through re-housing, temporary accommodation and children being taken into care.
Given the move to a single county court, will the Government consider establishing a more robust system for tracking the data and costing the outcomes, so that policymakers, and indeed the public, are given a clearer view of the dimension of the problems? The coalition agreement pledged action to deal with this problem and at page 12 of the Government’s programme for government promised, among other things, that they would,
“ban orders for sale on unsecured debts of less than £25,000”.
Unsurprisingly, the credit industry opposed the principle of a threshold, both when the idea was first floated in 2009-10 and during the recent consultation. In the event, it appears that the Government have substantially backtracked and have announced an intention to apply a threshold of only £1,000, so that charging orders and the threat of losing one’s home will remain for debts of that very modest amount or above. This is surely a major breach of the pledge in the coalition agreement. By definition, it threatens homeowners, not people in social housing or in receipt of housing benefit whom the Prime Minister and other Ministers, regretfully, are too often at pains to vilify. It is another example of a policy that will hit the working poor hard, just as some of the other changes will hit this group as hard or harder than the very small minority who abuse the system.
The Government have pointed out that creditors who are thwarted under a threshold scheme might resort to bankruptcy proceedings. I suppose that risk exists. If they did, however, at least they would not rank above other creditors who had not priced for the risk in the first place by charging a premium for the credit.
I hope that the Government will reconsider the level of the threshold. This amendment does not seek to prescribe a particular level, but rather to establish the principle and a requirement for parliamentary approval of any regulation establishing such a level. That is what the Delegated Powers Committee recommended in its second report; an affirmative resolution procedure for the establishment or alteration of a threshold level. It is clearly necessary for the threshold to be realistic and proportionate, and £1,000 patently does not meet those criteria. It would be interesting to learn from the Minister—perhaps not today because this is not, after all, her departmental concern—the rationale behind the Government’s abandonment of its pledge in the coalition agreement and its reduction of the threshold from £25,000 to the nugatory figure of £1,000. I beg to move.
My Lords, I thank the noble Lord, Lord Beecham, for bringing to the Committee’s attention the issue of charging orders. The power to prescribe the minimum amount above which a charging order may be imposed already exists, although it has not yet been implemented. That power is enshrined in Section 94 of the Tribunals, Courts and Enforcement Act 2007, which gives the Lord Chancellor the power to make regulations to provide that a charging order may not be made to secure a sum of money below a certain amount. While differently expressed from the noble Lord’s amendment, it will achieve the same end.
It should also be borne in mind that a charging order is only a means of securing a sum of money ordered to be paid under judgment and that it requires an order for sale of the charged property for ultimate enforcement. Section 94 of the 2007 Act includes a second power for the Lord Chancellor to provide that an order for sale may not be made to enforce payment of a sum below a certain amount.
Following a consultation paper in March 2011, the Government will introduce a minimum threshold of £1,000 in applications for orders for sale in Consumer Credit Act cases. It is also worth noting that as well as this statutory limitation, the court must take into account all the circumstances of the case before deciding whether to make an order, and this judicial discretion provides protection against disproportionate applications.
In terms of the conversion of charging orders into orders of sale, only a very small percentage are converted—less than 0.5%. In terms of the coalition’s commitment to a threshold for orders for sale at £25,000, evidence in the consultation did not support a £25,000 limit. People had reservations about this threshold, fearing that it would exceed the level for bankruptcy, which would risk creditors making debtors bankrupt instead. It would not affect the availability of credit or it might do, according to my note—I am afraid that I am not sure.
We have no current plans to exercise the power to prescribe the minimum threshold for a charging order, as opposed to that for an order for sale. As I have said, this is because of the concerns expressed in response to the consultation that such a minimum threshold could have an impact on the cost and availability of unsecured lending and the ability and rights of creditors and small businesses to recover smaller business debts.
I welcome the opportunity to expand on this area and hope my reply has provided the noble Lord with some information in response to his questions. I hope also that, in light of my explanations, the noble Lord will be prepared to withdraw his amendment.
My Lords, I am grateful to the Minister for her reply. She has certainly supplied some information, but I am afraid she has far from convinced me that the Government’s stance is correct. The effect of this failure to set a minimum threshold is to put homeowners in a particularly invidious position. By definition, it is only they whose homes are threatened if they are in debt. As I say, it stems from a consumer credit arrangement that already insures the creditor because they charge more for credit. Effectively, they are getting two bites of the cherry; they receive more for the credit facility and will have the opportunity to take these proceedings. Of course, judicial discretion exists, but as I have already indicated, it will leave people in considerable fear of losing their homes, pending an outcome. That is deeply unsatisfactory.
The noble Baroness has referred to evidence that was received. Obviously the consumer credit industry would be opposed to the imposition of a threshold which should apply both to the charging order and to sale, but it would be interesting to know what other groups were against it.
For the moment, I am prepared to withdraw the amendment, but it is something to which I think we shall be returning on Report.
Amendment 147ZA withdrawn.
147ZB: Clause 20, page 18, line 6, at end insert—
“36B Regulatory system for bailiffs
The Secretary of State shall establish a new regulatory system for bailiffs.”
My Lords, I am engaged in a series of probing exercises today. Not being a dentist, it is not a familiar role. This amendment deals with the thorny question of bailiffs. Again, this is an area of law on which the Government have been engaged in consultation with a view to strengthening the system of debt collection and debt enforcement. They have come up with some proposals, but rather than deferring action until the next Session of Parliament, I would urge them to take the opportunity to bring forward those proposals for inclusion in this Bill. We will, after all, still be in Committee when the House returns after the summer Recess. If it were delayed beyond then, there may well not be time in this Session of Parliament to deal with this issue. Admittedly, the consultation has only just ended—I think it ended last month—but I suggest that it is not beyond the Government’s capacity to seek to deal with it by an addition to this Bill after the summer.
There has long been concern about the law covering debt enforcement by bailiffs, whether under county court judgments, under a warrant for execution or under the magistrates’ court, to collect fines, council tax arrears, compensation or maintenance in family cases, when acting on a distress warrant or liability order. In the High Court, High Court enforcement officers are employed to enforce writs of execution. The whole area is, in the Government’s view, “complex, unclear and confusing”, with a history stretching back centuries and sometimes with language to match. It is understandable that, as the Ministry of Justice stated in its consultation paper of February 2012:
“This confusion can result in bailiffs and enforcement officers misrepresenting their … authority”.
I must stress that the concern is not, essentially, over the actions of employees of the courts but over private bailiffs. There are unfortunately many cases in which bailiffs have acted in unacceptable ways and beyond their powers, and there is widespread concern about their charges, which the debtor must meet. I cite one example, which was quoted by the Zacchaeus 2000 Trust—again, chaired by the Reverend Paul Nicolson—in its briefing on what was the LASPO Bill. It cited the case of a firm of bailiffs that, without going through the necessary procedure, seized goods from a single mother with an 11 month-old baby and another young child. She was on benefits and suffered mental health problems. She owed £2,365—a substantial amount. The goods seized included a kettle and a toaster. The firm said that it was permissible to seize the kettle and toaster because the mother had a pot and a cooker.
There are worse cases than that. Last September, a bailiff called on a pregnant woman, saying that she owed £58 in council tax. She had received no communication about this. When she asked the bailiff to hold on while she got dressed and moved to close the door, the bailiff kicked the door in, injuring her leg and hip. When the police were notified and sought information from the bailiff’s firm, they were denied on the rather spurious grounds of data protection. There was another case in Wales in which a bailiff obtained a walking possession illegally, harassed a woman in the street in front of her friends and contacted her through a social networking website. As a final example, in south-east England a 19 year-old woman failed to pay a £118 fine for improper use of a child’s train ticket and, although she requested a payment plan, was visited by a bailiff who threatened to seize her mother’s goods—not her’s but her mother’s—if the bailiffs were not paid £418. He abused the young woman’s mother, threatened to remove her car and said that he could take anything in the house and break the door down to do it.
These are matters of great concern and, in fairness to the Government, they have acknowledged that there needs to be considerable improvement in the whole system. The previous Government sought to address some of these issues in the Tribunals, Courts and Enforcement Act 2007, which was designed, inter alia, to improve the regulation and practices of bailiffs and change the way that debt collection and enforcement is carried out. Part 3 of that Act, which has yet to be implemented, would introduce a complete code setting out the bailiffs’ power of entry onto premises, what goods can be seized and sold, what fees can be charged and the whole process from the serving of notice to the distribution of sale proceeds.
One aspect of Part 3 of the 2007 Act would create a proper system for the independent regulation of bailiffs, which is at present sadly lacking. There is no nationally recognised qualification or standard of competence for bailiffs, who can merely be certificated by the county court in relation to certain types of debt enforcement, including road traffic debts, council tax and non-domestic rates. In addition, they need to be certificated to distrain for rent—although Part 3 of the 2007 Act, if and when it is implemented, would also limit that to cases of commercial properties and rents, rather than domestic rents.
The previous Government made some initial moves to improve matters by setting up an online register of certificated bailiffs—so that debtors could check whether the bailiffs were in fact recognised to that extent—a Criminal Records Bureau check for would-be bailiffs when applying for certification and some minimum training requirements. The present Government took matters forward in January, and I welcome that, by setting out the National Standards for Enforcement Agents to be adopted by councils and other authorities for use by those working for them. This is a voluntary code and requires, for example, that bailiffs refrain from using threatening behaviour or unlawful force to gain access to premises, or from discussing a debt with anyone except the debtor. They have to withdraw if only a child is present on gaining entry and have a duty of care to elderly, disabled or vulnerable people. So far as they go, those are useful measures and, to their credit, the Government seek to enshrine these principles and other measures in law, and to reply to the consultation that concluded in October.
However, it is critically important that the new regime includes rigorous criteria for the independent accreditation of bailiffs, backed by an effective regulatory regime with regular monitoring and an accessible complaints system. The courts and other statutory bodies must have a special responsibility both for staff they directly employ on enforcement and those with whom they contract. In my view, the Government are moving in the right direction but need to act to carry out the intentions of the 2007 Act and take them further, so that we can avoid the disgraceful behaviour of what are no doubt a minority of bailiffs, who were exemplified in the cases to which I have referred. I again urge the Government to clarify today what they have in mind, if they can, but certainly, if at all possible, to go beyond simply replying to the consultation in October by bringing forward amendments to this Bill so that the matter can be dealt with as part of this legislation and concluded in this Session. I beg to move.
My Lords, I am grateful to the noble Lord, Lord Beecham, for explaining his thinking behind this amendment. He described what are, indeed, horrendous accounts. There have been debates over many years about this problem. Let me start by saying that we understand the concerns about bailiffs. The Government have given a commitment to providing more protection against aggressive bailiffs and are working to this end. I thank the noble Lord for his welcome for the progress that we have been making.
In January, the Government announced the updating of the National Standards for Enforcement Agents, with a view to defining acceptable behaviour for bailiffs. This was the first step in the Government’s plans to change the way that bailiffs are regulated and to make sure that they operate fairly to all concerned. Then, in February, we launched a public consultation which set out how we plan to provide more protection against aggressive bailiffs while still enabling effective enforcement. The package of proposals seeks to restore balance to the system; to improve clarity so that both debtors and creditors know where they stand; to strengthen protections for the vulnerable; and to ensure that individuals, business and government are able to collect the debts that they are owed.
Our aim is to respect the competing rights of both the creditor and the debtor. Unless there is prompt and effective enforcement, the authority of the courts and public confidence in the justice system are undermined. Creditors are entitled to collect what they are owed, while debtors should be protected from the kind of oppressive pursuit of their debt that the noble Lord has just described. This consultation set out a number of specific proposals, which, among other things, seek to: set out to whom and under what circumstances reasonable force to enter premises will be available; set out when and how a bailiff can enter a property; create minimum entry standards and certification processes to ensure bailiffs are fit to operate; prohibit the use of force against a person, with additional safeguards to protect children; make clear which items an enforcement agent may not take from someone’s home; make clear what fees bailiffs can charge for the range of debts that they collect for local government, courts and businesses; and remodel and clarify the complaints process available to the debtor. I hope that all of those proposals would address the noble Lord’s points.
The consultation, as the noble Lord, Lord Beecham, acknowledges, closed only recently on 14 May and we are now carefully considering the responses, with a view to publishing our response in the autumn. This has therefore been a timely debate and we will certainly take account of the noble Lord’s views. I will make sure that what he has just said is fed into the MoJ.
Like the noble Lord, the Government are clear that aggressive bailiff activity is unacceptable. We are committed to bringing forward effective proposals in due course to protect the public and ensure that bailiff activity is proportionate. I hope that, with those assurances, and having had the opportunity to raise this important issue, which we fully recognise, the noble Lord will be prepared to withdraw his amendment and await the Government’s proposals later in the year.
I thank the Minister for her very full reply. I am certainly prepared to withdraw the amendment. Can she give me an indication as to whether the Government will at least consider using the Bill as a vehicle for the welcome changes that she suggests will follow? I would have thought it feasible to do that, given that we will not have completed Committee by the time we return. When we return, we will have further work to do on the Bill as it stands and since there is likely to be very broad support across the House for the changes that she proposes, it would not be too difficult to add these matters to the Bill. I do not ask for a firm commitment but for an indication that the Government will at least consider doing that.
As an extremely junior member of the Government, that would be going way beyond what I am allowed to do, but the important thing is not to pre-empt consideration of the consultation. The noble Lord may assume as to what may emerge from people’s responses to that consultation, but it is appropriate for Government to give due consideration to what comes in, and we will make proposals in due course.
Amendment 147ZB withdrawn.
Clause 20 agreed.
Clause 21 agreed.
Clause 22 : Enabling the making, and use, of films and other recordings of proceedings
147ZC: Clause 22, page 21, line 28, at end insert—
“(1A) Before issuing any order under subsection (1), the Lord Chancellor shall first report to Parliament that the following principles have been adhered to in any decisions made under subsection (1)—
(a) the protection of witnesses, victims, defendants, parties and jurors, who shall under no circumstances be recorded;(b) the promotion and proper administration of justice;and filming shall not be permitted if it would cause undue prejudice to any person involved in the proceedings.”
We now come to debate the broadcasting of court proceedings. This has already taken place in respect of certain proceedings of the Supreme Court. There is a suggestion in the Bill that this should be significantly widened. My amendments support the principle, but set out guidelines as to the way in which change might be made and also take into account—implicitly, I have to say, rather than explicitly—the recommendation of the Delegated Powers Committee that any changes should be made by regulation; again to be approved by parliamentary vote.
Amendment 147ZC proposes that in making an order as to which categories of case might be broadcast and when that might happen, the Lord Chancellor should apply principles that should be first reported to Parliament. The basic principle is surely that broadcasting of court proceedings is for the purposes not of entertainment but of promoting understanding of the judicial system and thereby reinforcing public confidence in it. It is not by any means to be a YouTube of incidents, as opposed to proper, sensible coverage of an important area of public life, the justice system.
Amendment 147ZC requires the Lord Chancellor, in making any order extending categories of broadcasting, to confirm that principles have been adhered to, including, most essentially, the protection of witnesses, victims, defendants, parties and jurors, who shall under no circumstances be recorded; the promotion and proper administration of justice; and that filming should not be permitted if it would cause undue prejudice to any person involved in the proceedings. That is a fairly straightforward provision designed to protect the integrity of the system.
The decision in an individual case should, of course, be a matter for the judge. There may well be cases in which the judge decides that it is not appropriate, in all the circumstances, to take advantage of the permission to allow broadcasting that the Bill, if enacted, would confer. Amendment 147B simply says that, in making a direction that broadcasting should be permitted, the court or tribunal should have regard to the principles that I have adumbrated, which would, if the amendment is accepted, apply to the Lord Chancellor in widening the range of potential broadcasts in the first place.
Clearly there are legitimate concerns about the extent to which broadcasting might impinge on people’s positions, particularly parties to the case. I do not think that the Government envisage extending coverage to the whole process of trials, rather to particular aspects. Some of these are mentioned in other amendments, in particular sentencing, remarks on sentencing, and perhaps arguments by a counsel. Such matters should be dealt with properly by regulation, taking into account the factors mentioned in Amendment 147A.
I hope that the Government will respond positively to these suggestions and I look forward very much to hearing the views of other noble Lords who have tabled amendments. This is an area of considerable public interest and concern. There is a way forward, the Government are on the right lines, and with some safeguards we would be prepared to support the principle of extension. The question, of course, is where one draws the line and that is a matter which we will no doubt be debating this evening and further on Report. I beg to move.
Amendment 147A is in my name and that of my noble friend Lord Thomas of Gresford. I do not take issue with the principles set out in Amendment 147ZC, moved by the noble Lord, Lord Beecham, except that I question the term, “undue prejudice”. I wonder whether filming should be permitted if it might cause any prejudice, but that is a minor point.
I am pleased to see the government amendment providing for the affirmative procedure; it will give us the opportunity to debate the extension of the subjects that can be broadcast. I have no doubt with my amendments that the Government intend to see how it goes, limiting the items as they have described. The two paragraphs listed in our amendment may look less than the Government had proposed for the initial—experiment is perhaps too loaded a term—experience of filming, recording and broadcast, but my noble friend Lord Thomas corrected my drafting and said that the term “judgments” covered everything that was needed in the first paragraph. However, this development seems to me to be so significant that I am not convinced that it should not be stated in the Bill and that any extension of it should not be the subject of primary legislation.
I agree with those who predict pressure from the broadcasters for an extension so that there is livelier material for the 6.30 news and so on. Even “Today in Parliament”, admirable though it is, chooses the livelier and racier exchanges, and that is entirely understandable—it seeks to balance those with the important items that get discussed in both Houses, and it has half an hour to do so. When one is looking for a clip of only a few seconds, one is bound to want something that will grab the audience’s attention. Of course, a wider understanding of the justice system must be a good thing. I do not want to sound too paternalistic, but there must be a danger that an extension that popularises and simplifies would lead to a loss of subtlety and complexity. The noble Baroness, Lady Kennedy of The Shaws—who has far more experience of the courts than I do—spoke powerfully about this at Second Reading.
At Second Reading I mentioned the issue of counsel playing to the gallery. It occurs to me that others may do so as well. The experience of the riots last summer, and what came out regarding the behaviour of some of those who were charged and what was prompting them, has made me wonder whether people in that situation might themselves seek to use proceedings that were broadcast in order to continue the political statements that they were making. The Government always say that we must beware of the lack of legislative opportunities but, as we generally get a criminal justice Bill each year, that does not necessarily seem to be the best argument.
When we have secondary legislation—I acknowledge that there have been improvements in the reporting by departments of consultation that has taken place before secondary legislation comes before your Lordships—it is likely that there will be a variety of views on the details of the extension and the parts of court proceedings that would be covered. These will be difficult to deal with because of the inability to amend secondary legislation. My general point is that this is so important a step that it should require the closest consideration.
As ever, when one looks at one’s own drafting immediately before standing up to speak to an amendment, one sees the faults in it. I should perhaps have included the word “only” after the phrase,
“an order may be made”,
but this is Committee so I hope that your Lordships will not hold that against me. I do not regard approval of the very limited recording that is currently proposed as amounting to approval in principle for recording and filming in court to such an extent as to avoid the need for the consideration, on the basis of primary legislation, of an extension to this.
My Lords, I support my noble friend in the amendment that is also in my name. She referred to people using television for their own purposes. There has been an example of that recently in Norway, where your Lordships will recall that a defendant has made every use that he possibly could to carry his message to the public. Your Lordships may think that that is an example of the sort of thing that we wish to avoid.
The noble Baroness, Lady Kennedy of The Shaws, was somewhat caught today by the two back-to-back Statements and was due to preside over the important recognition of the anniversary of the 7/7 massacres. Consequently, she is not able to be here to promote her Amendment 147AA. She has no problem in relation to the higher courts and neither do I—there is no reason why the Court of Appeal or the Supreme Court should fear exposure to the cameras—but she is concerned, and I share her concern to a considerable degree, that the sentencing remarks can possibly lead to problems, as my noble friend Lady Hamwee has just pointed out.
I have no doubt that sentencing remarks would be used only in high-profile cases with salacious details or where celebrities were involved. It would not be long before there was pressure, when sentencing remarks were made, for the camera to show the face of the defendant as he received his sentence or, even worse, the faces of the victim or their families at that critical moment about which I spoke at Second Reading. I am very concerned about that. We must avoid the business of the court being made entertainment for people. Criminal court is a very serious matter and the parameters must be considerably restrained. I support the amendment in my name and that of the noble Baroness, Lady Kennedy.
My Lords, I welcome Clause 22. Broadcasting will enhance the public understanding of our justice system, which in general works efficiently and fairly. It is important that members of the public are able to see that this is so through modern means of communication. As is often said, justice should be seen to be done.
There is also, of course, the possibility that allowing the cameras in may illuminate areas of court proceedings that are in need of reform. I entirely agree with what has already been said about the fundamental undesirability of cameras showing the evidence or, as the noble Lord, Lord Thomas of Gresford, said, the reactions of witnesses or victims at any stage of the court proceedings. I am sure that the Minister’s intention is to have regulations that would prohibit any of that, and I look forward to hearing what he says about why that matter should not be addressed in primary legislation.
I am a bit concerned by the final words of Amendment 147ZC, moved by the noble Lord, Lord Beecham, which say that filming would not be permitted if it would cause “undue prejudice” to any person involved in the proceedings. I can well understand that a defendant in a notorious case, in which there was a very strong argument for broadcasting the sentencing remarks, may say that to single him out for broadcasting would indeed involve prejudice. It would be most undesirable if people were able to present such an argument.
I am very concerned about Amendment 147A in the names of the noble Lord, Lord Thomas of Gresford, and the noble Baroness, Lady Hamwee. As I understand their amendment, it would prohibit the broadcasting of any part of the argument in, for example, the divisional court or the Court of Appeal, despite the fact that the issues raised may be of considerable public importance. If that is the noble Lords’ intention, that seems highly undesirable.
I am grateful to the noble Baroness. I would hope that the Government would allow, at the discretion of the judge, the broadcasting of the arguments in the divisional court and in the Court of Appeal—cases, of course, where there are no witnesses. There is no evidence; these are matters of law. Some of them—one could easily give examples—are matters of fundamental public importance. If, as is the case, the whole of the proceedings in our Supreme Court can be broadcast, including the arguments that are being addressed, it would seem highly desirable that the broadcasters should be allowed, at the discretion of the judge, to broadcast the arguments in the lower courts.
The noble Baroness, Lady Hamwee, expressed a number of concerns about broadcasting. I am sure the noble Baroness is right that the danger is that broadcasters may be looking at the most sensational cases, and will broadcast snippets of the proceedings and may sensationalise matters. However, that is already the case in relation to print journalism and I see no reason at all why Parliament should be more concerned to regulate the content of what is communicated to the public through broadcasting than through print journalism.
I also have to say, as someone who has appeared in a number of cases in the European Court of Human Rights and the Supreme Court that have been broadcast, that her fears that counsel will play to the gallery are unfounded. I am not aware of any evidence that, once the case gets started and the submissions are being made, those who are presenting the arguments do other than focus on persuading the court. Indeed, were they to do otherwise and present themselves as actors with a view to impressing a wider audience, they would undoubtedly soon suffer the unemployment that is endemic in the acting profession. They are also regulated by the Bar Council.
The noble Lord, Lord Thomas of Gresford, expressed understandable concern that there should be no risk in this country of any broadcast of the equivalent of the recent conduct of the Norwegian defendant. I suggest to noble Lords that a discretion for the trial judge would prevent that. In any event, witnesses, victims and defendants could not be broadcast.
We should welcome Clause 22. Many of the concerns that have been expressed, I submit, are unfounded, and I hope the Government will allow broadcasting at the discretion of the trial judge—certainly of sentencing remarks and judgments in the Court of Appeal but also, I would hope, of judgments in the lower courts such as the Divisional Court and the High Court generally, and arguments in the courts below the Supreme Court.
My Lords, after hearing my noble friend Lord Beecham on my own Front Bench and the spokesman from the Liberal Democrat Benches, I was a little anxious that we were going to be extremely restrictive on this opening-up of the courts to television, radio, et cetera. The noble Lord, Lord Pannick, has redressed the balance by putting an emphasis on what I might call “open justice”. The phrase, “Justice must be seen to be done” is not just one we trot out when dealing with matters of significance, in terms of enabling the public to know the arguments for this or that, it is a meaningful phrase that has its origins in the reality that people used to attend courts, especially the local magistrates’ courts, in great numbers. I remind your Lordships that in the 19th century, and to some extent the 20th century, newspapers, especially local newspapers, used to have journalists on tap who would report at great length—pages and pages—on the evidence, arguments and judgments given in the magistrates’ courts. That was the way in which the public could assess what was going on in their name in the courts of justice in this country.
As a matter of fact, sadly or otherwise, nowadays journalists on local newspapers very rarely go to magistrates’ courts and do that job that used to be done by their predecessors. It follows that people today know less about what goes on in their local courts than was the case, and the Government’s proposal in Clause 22 redresses the matter. I agree entirely with the noble Lord, Lord Thomas of Gresford, and found myself nodding as he said that we do not want such television performances as that of the Norwegian defendant in the case to which the noble Lord referred. The defendant was skilfully using the fact of being in court to retail political and other propaganda, for the benefit not of the justice system being better understood but of the kind of extreme views that he held.
As the noble Lord, Lord Pannick, indicated, it should be possible to broadcast lawyers and judges arguing legal matters or otherwise, or judges sentencing when a trial comes to an end. As the Government are making a relatively new and welcome advance in these matters, we should not be too restrictive. That does not mean I necessarily disagree with my noble friend Lord Beecham on the matter of detail to which he referred, but I had the feeling he might be a little too restrictive—or cautious, it might be sufficient to say—and preferred the open approach of the noble Lord, Lord Pannick.
My Lords, as we have heard, the amendments tabled by the noble Lord, Lord Beecham, the noble Baroness, Lady Kennedy, and my noble friends Lady Hamwee and Lord Thomas of Gresford seek to clarify, in their different ways, the circumstances in which court broadcasting is to be permitted. There are also a number of government amendments in this group, which I will explain.
The noble Lord, Lord Beecham, is right that this is about promoting understanding of our judicial system, as happens in various other countries, and I welcome what he and the noble Lords, Lord Pannick and Lord Borrie, said about the Government being on the right lines. We recognise the risks outlined by my noble friends Lady Hamwee and Lord Thomas of Gresford. We have considered this very carefully and I am sure the implementation of these changes will be carefully monitored by all. We have heard from both sides in this argument—from what the noble Lord, Lord Borrie, described as “open justice” to concerns that coverage should not have negative consequences.
Clause 22 will allow the Lord Chancellor, with the agreement of the Lord Chief Justice, to lift the ban on filming in courts in certain circumstances and set out the limitations surrounding those. The provisions build on the successful broadcasting of the proceedings of the Supreme Court. The Government initially plan to use the order-making power in this clause to allow the broadcasting of judgments and advocates’ arguments in cases before the Criminal and Civil Divisions of the Court of Appeal. Cases in the Court of Appeal normally deal with complex issues of law or evidence, and victims and witnesses rarely appear in order to provide new evidence. Given the complexity of legal issues in Court of Appeal cases, we believe that allowing advocates’ arguments to be filmed in addition to judgments would be more likely to improve public understanding than filming judgments alone. Over a longer period, we expect to allow broadcasting from the Crown Court, but to limit it to the judge’s sentencing remarks after the conclusion of the trial. We believe that this will help to increase the public’s understanding of sentencing, with low risk to the proper administration of justice.
While we have no plans to extend court broadcasting beyond these two sets of circumstances, we believe that once Parliament has approved the principle of broadcasting selected court proceedings, the details should be set out in secondary legislation. Any secondary legislation permitting broadcasting in particular circumstances will require the agreement of the Lord Chief Justice and the Lord Chancellor and will be subject to parliamentary scrutiny. We believe that this triple lock provides sufficient safeguards to ensure that court broadcasting is introduced in a safe and proportionate manner.
Following the report on the Bill by the Delegated Powers and Regulatory Reform Committee, we intend further to strengthen this triple lock by providing, through Amendment 155C, for orders made under Clause 22 to be subject to the affirmative procedure, as that committee recommended. As a result, each and every extension of court broadcasting will not only have to be agreed by the Lord Chief Justice but to be debated and approved by both Houses.
The amendments tabled by the noble Lord, Lord Beecham, seek to amend the Bill to protect the interests of victims, witnesses, jurors, defendants and other parties as well as to safeguard the proper administration of justice more widely. The amendments in the names of the noble Baroness, Lady Kennedy, and my noble friend Lord Thomas are, we believe, motivated by the same concerns.
I shall comment on the concerns expressed by my noble friends Lady Hamwee and Lord Thomas of Gresford about trial by media. The Communications Act requires broadcasters to present the news with accuracy and impartiality. It also prohibits giving undue prominence to views on matters of political or industrial controversy and matters relating to current public policy. The broadcast media are regulated by Ofcom, which has the ability to impose substantial fines and even to revoke licences. We are aware of the concern that televising our courts may open the judicial process to sensationalism and trivialise serious processes to a level of media entertainment. That is why we are not proposing to allow full trials to be