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Private Security Industry Bill Hl

Volume 621: debated on Tuesday 30 January 2001

The text on this page has been created from Hansard archive content, it may contain typographical errors.

3.5 p.m.

My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.

Moved, That the House do now resolve itself into Committee.—( Lord Bassam of Brighton.)

On Question, Motion agreed to.

House in Committee accordingly.


Clause 1 [ The Security Industry Authority]:

moved Amendment No. 1:

Page 1. line 7, leave out ("Industry") and insert ("Activities").

The noble Lord said: For the reassurance of the noble Lords who are leaving the Chamber, this is a modest amendment that probably will not lead to a clash of intellects across the Floor of the Committee. Unless noble Lords have a serious interest in the Bill, they are wise to leave.

The Bill sets up a new regulatory authority to be called the security industry authority. The amendment suggests that it should be called the security activities authority. The point being made is that this authority will regulate a good many activities that are not generally considered part of the security industry. So far "the security industry" has not been a very carefully defined and understood term and many people would not know what the definition covers.

The British Security Industry Association has a number of large and small firms in its membership. It covers many of the activities that are to be regulated by the Bill. One of the activities is wheelclamping. As the Bill stands, it will cover wheelclamping by private individuals who are not any part of what one might think of as the security industry. It covers private detectives. In some senses they belong to the security industry, but one has to define it very widely to include them. It covers keyholders. Those often are some of the large and well-known firms in the industry. But it also concerns door supervisors—"bouncers", as some people call them—who frequently are not part of the security industry as such. "Bouncers" and wheelclampers are covered whether or not they are under contract to a large firm. In-house door supervisors and in-house wheelclampers are covered. So the Bill is extremely wide in terms of the coverage of the new authority.

It seems to me that it might be sensible to think of a different name which indicates that the authority will not only regulate the security industry itself but also these extraneous activities. I beg to move.

Perhaps I may add a few brief words of encouragement to my noble friend in respect of his incisive amendment. Clearly, this is a way to illustrate the fact that the Bill has a wider application than merely to those who work full-time in the private security business. A number of other people will be affected. The arguments put forward so convincingly by my noble friend also apply to a later amendment relating to the Long Title of the Bill. The Long Title states:

"Make provision for the regulation of the private security industry".
However, the Bill goes wider than that. I shall be interested to hear the Minister's response to my noble friend's suggestion on that issue.

I am grateful to the noble Lord, Lord Cope, for the clarity of his explanation of what he described as a very modest amendment and one which he thought would not be too intellectually taxing. That probably means that I can cope with it.

The noble Lord is right to say that a diverse range of security activities are undertaken by the private sector, some of which are regulated under the provisions of the Bill. But the umbrella term "industry" is well-used and widely accepted and is probably the term that is best understood. For example, it is used by both the main trade associations—the British Security Industry Association and the Joint Security Industry Council. It is also the case that during the consideration of the Bill and in the discussions that have taken place inside and outside the House the notion of it being called the security industry authority has become widely known and probably widely accepted as the most likely and perhaps most useful title for that agency.

I do not believe that we should accept the amendment, although I can see that there might be a desire to try to think up another term. What we have proposed satisfies most people. It is certainly the clearest and most easily understood term. Therefore, at this stage, I do not think there is any useful purpose to be served by accepting the amendment. I certainly did not find anything particularly persuasive in what he said, although I thought that it was an interesting set of observations.

I have another concern about the noble Lord's suggestion. The insertion of the word "activities" may give a false impression that the regulatory body will cover something wider than the private security industry. Some might even see it as covering the Security Services. That would give a very false and misleading impression.

For all those reasons, I cannot accept the amendment. I urge the noble Lord to reconsider his position and withdraw the amendment.

I certainly would not wish to give a false impression, particularly not with regard to the Security Services. At the same time, it seemed to me that the Title of the Bill gives a false impression in another direction. However, I do not think that it is a significant enough matter to pursue. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

moved Amendment No. 2:

Page I, line 12, after ("of') insert ("people employed wholly or predominately as").

The noble Viscount said: In moving this amendment, I wish to speak also to Amendments Nos. 9, 10, 11, 12 and 46. The amendments are concerned with narrowing the definition of who will come under the Bill. Although the Minister was reasonably clear at Second Reading, there is certainly some confusion about whether a person's job is full-time in security or part-time. The Minister said that in-house providers are not subject to regulation in general. However, since then we have had rather confusing messages. My amendments seek to define who will come under the Bill and to get the Government's thinking on this issue.

It is important that the new authority should be responsible for those who are full-time or predominantly employed as security operatives. What is the position with a barman in a pub? Frequently, barmen exclude people from pubs. Some pubs have people who look after security but many pubs do not. In that instance, they should obviously not be covered. At Second Reading the Minister said that to some extent the Bill will catch publicans. We need to know to what extent and how that will work.

Amendment No. 2 seeks to add the words,

"people employed wholly or predominantly as",

security operatives. Amendments No. 9 seeks to include the words,

"as a principal part of his employment".

Amendment No. 10 is very similar. Amendment No. 12 refers to Schedule 2 to the Bill. Amendment No. 46 narrows the definition in Paragraph 2(2) of Schedule 2, which also allows ticket collectors as well as firemen to maintain discipline.

There has been a great deal of correspondence from various sections of the industry. I am sure that the Minister will have received it. There are those who wish to extend the provisions as wide as possible. Some wish to do so for no doubt thoroughly proper motives while others see it as a wonderful business opportunity. There are also those who seek to ensure that industry is not faced with costly over-regulation as a result of this worthwhile Bill. We support the aims of the Bill, but we want something that will work. This has to be handled with a reasonably light touch. Too heavy-handed an approach will not work.

I am sure that the Minister will respond by saying that much will depend on how the new authority conducts its business; namely, that the proof of the pudding will be in the eating. I agree that that is the case and, of course, we shall be addressing the point in later amendments. However, the authority will need to take careful account of what is laid down in the Bill because the provisions of Clauses 1 and 3 will form the basis of the authority's guidelines.

We feel that these are important issues. It is necessary to define exactly who will be included in the definitions so as to ensure that those for whom the provisions of the Bill will be unnecessary and for whom the Bill would become merely a "burden on industry" are not affected. I beg to move.

My noble friend has tabled a bevy of amendments, all of which are designed to achieve much the same aim. A great deal of harmony exists between the parties on this Bill. At Second Reading, the Minister went to some lengths to reassure the House that that he, too, did not wish to see the legislation and, to an extent, the authority brought into disrepute by having to impose considerable burdens on those for whom security duties were merely incidental to their primary activity. We have taken careful note of those assurances.

Given that, the Minister will need to put forward a strong and convincing case to explain why such groups will not be affected by the Bill. The amendments tabled by my noble friend seek to make the position much clearer.

I am grateful to both noble Viscounts for their contributions to these amendments and for the clarity with which the noble Viscount, Lord Astor, moved his amendment. His concluding comments summarised his position; namely, that we need to strike a balance between proper regulation and the need to avoid over-regulation. That probably forms the parameter of this debate and I accept the point. I hope that I cart offer the reassurances sought by the noble Viscount. Perhaps I may address each of the amendments in turn.

As regards Amendment No. 2, we feel that other relevant provisions already contained in the Bill as currently drafted already take into account the level of activity which a security operative would have to undertake before a licence was required. Definitions of the activities which will require a licence are carefully listed in Schedule 2. They provide for the exemption of a number of different employment categories. Exemptions are also provided for those who carry out security activities incidentally to their main employment. There is no question that the authority would wish to impose the licensing regime on individuals who do not have significant security-related duties. We believe that the Bill as drafted will work effectively to cover that point.

I turn now to Amendment No. 9. Here again the Bill already takes account of the aim of this amendment, which seeks to exclude from regulation those individuals whose security-related activities are incidental to their main employment. Again, those are listed in Schedule 2 to the Bill. We have no desire to make the regime inflexible and unworkable and to that end we believe that the current drafting works well.

As regards Amendment No. 10, we believe that the Bill already takes into account the main objective of the amendment and that we are on common ground here. We feel that a significant measure of flexibility has already been built in to respond to this point.

A similar argument could be put forward as regards Amendment No. 11. For regulation to be effective, we think that it is important that those who own or operate companies need to be held accountable. If this amendment were to be pressed, it would exclude directors and partners who do not themselves directly carry out the designated activities. We think that that would shoot a hole through the import of the Bill. Evidence has been gathered of companies which have been established by individuals who have criminal records, some with convictions for violence and drugs offences. Although they themselves may not be directly involved in the provision of security services, I cannot believe that the noble Viscount would wish to exclude such people from the remit of the Bill. It is vital that these individuals should be weeded out of the industry and prevented from establishing themselves in it in the future.

We consider that the licensing of directors and partners will form a fundamental part of the effective regulation of the industry. Licensing will apply to directors and partners not directly engaged in the activities of a security operative but who are directly responsible for the company or those carrying out such activities.

As the Bill stands, the security industry authority will be able to identify and remove criminality at any level within an organisation. This will be a major benefit both for the industry as a whole and for the public. Furthermore, I am sure that noble Lords opposite will be aware that the licensing proposals have been welcomed by the industry. For those reasons, I shall not be able to accept Amendment No. 11.

I turn now to Amendment No. 12. Schedule 2 defines the activities of security operatives which are subject to regulation by the Bill. Paragraph 1(1) of the schedule makes it clear that the activities referred to are those undertaken by "a security operative". The relationship between Clause 3 and Schedule 2 is made explicit by Clause 3(4). That subsection confirms that Schedule 2 defines the activities that are also to be treated as security operations for the purposes of the Bill. Thus the addition of a further reference to Schedule 2 within the text of Clause 3, as proposed in this amendment, is entirely unnecessary. I hope that, with this explanation being put on to the record, noble Lords will feel able to agree to withdraw the amendment.

Finally, I turn to Amendment No. 46. Paragraph 2(5) provides an important clarificatory exemption from the need for a licence as a manned guard. Similarly, important exemptions are made in paragraphs 2(4) and (6). These provisions are designed to ensure that the definition of "manned guarding" used in paragraph 2(1) does not inadvertently take into regulation activities which have nothing to do with the private security industry.

An example of where the exemption in paragraph 2(5) would apply is the teaching profession. Teachers maintain order and discipline but clearly are not part of the private security industry. Without the text which this amendment seeks to delete, it will be less unambiguously clear that teachers—and perhaps people leading holiday expeditions—are not covered by the provisions of Schedule 2. It is important that readers of the Bill should have the minimum possible doubts as regards which activities are included within its scope. I am afraid that this amendment would increase uncertainty and for that reason I am not able to accept it.

I hope that these explanations will persuade the noble Viscount to withdraw his amendment.

I should like to return to Clause 3(2)(f) which Amendment No. 11 seeks to delete. This states that,

"a director of any body corporate … engages in licensable conduct",
if any of his fellow directors do so under the provisions of paragraphs (a) to (e). A large engineering firm, for example, may hire a private security firm to man the gates and to provide manned guarding at night. That activity is covered by the Bill and would require a licence. Given that, the personnel director or manager in charge of security for the engineering firm as a whole would also require a licence. Under paragraph (d), he will be acting as the supervisor to those engaged in a relevant activity. The guard may belong to Securicor, but the manager is responsible for him as regards his work at the engineering company. For that reason, the manager or the personnel director would also require a licence simply because he is responsible for making sure that the security industry firm does its job. That means that, under paragraph (f), every director of the engineering firm must have a licence.

This appears to apply to just about every company quoted on the stock exchange, and many that are not, because there is a kind of escalation. The guards may be employed by Securicor, Group 4, Reliance, any one of the large firms. The engineering firm—though it could be anything: a chemical firm or whatever—supervising those people is definitely caught under paragraph (d). Therefore, under paragraph (f) every other director of virtually every firm will require a licence. I cannot believe that that is what the Government intend, but it seems to me, reading these paragraphs together, that that is how everybody will be caught.

3.30 p.m.

This matter has caused concern in industries across a wide range of activities. For example, the cinema industry has expressed concerns very similar to those expressed by my noble friend, Lord Cope of Berkeley, in connection with paragraph (d). I understand—the noble Lord the Minister will correct me if I am wrong—that the industry is exempt from some other provisions of the Bill in the day-to-day conduct of its business. But if a cinema company brings in security guards for a premiere, or some other special event, there will be a burden on the person within that cinema company who contracts with the security company in that that person will need to be licensed. This would be a very good opportunity for the Minister to clarify his understanding of the implication of paragraph (d). Basically, the question is this: does it mean that any company that hires a security company must itself be licensed?

I am grateful to noble Lords for their further clarification of the amendment. Perhaps to say that we are at cross-purposes would be to use the wrong term, but there may well be a misreading of the clause, because it is certainly not our intention that the personnel director of the engineering company in the example given by the noble Lord, Lord Cope of Berkeley, would have management responsibility for the security staff at the gates of the company's premises, nor that that director would need to be licensed. We are talking about the management of the security company itself, not of the engineering company that is contracting those working for that company.

I hope that that clarifies the point. I shall be more than happy to provide further chapter and verse in correspondence if noble Lords wish, but I hope that I have dealt with the point clearly.

The Minister has dealt with Amendment No. 11 to a degree. What he is saying, as I understand it, is that anybody who uses a firm will not be covered by the provision; it is only in the firm doing the security work that the director is covered. That is fine as far as it goes, but some very large companies contain individual companies—wholly owned, associated or whatever—that have contracts between themselves. Therefore, it is perfectly possible for there to be large organisations that in certain circumstances carry out security work in a plant that they perhaps do not wholly own. Whatever the reason, it seems in principle that if they could be covered it must make sense for liability to attach only to those who are, as it were, licensed people themselves. Paragraph (f) seems to extend the responsibility to those who will not be licensed by the new authority. That seems wrong in principle.

I accept the principle that if one is involved in the security industry and is a licensed person, whether an individual, a partner or a director of a company, one should be responsible, and that that licensed person must be the responsible person. But it seems wrong to extend that responsibility perhaps even to a non-executive director of a security firm and make him or her responsible for the activities of the managing director or someone else in charge. That is in fact what the Bill does, and it is a step too far.

I hope that the Minister will consider the matter, because we shall want to return to it at a later stage. I cannot believe that it is the Government's intention to extend that responsibility further than necessary, bringing in a whole class of people. I am all for making those who come within the orbit of the security industry authority become licensed, making them responsible in a corporate, individual and partnership way, but there must be some ring-fencing or the matter will become very difficult.

I do not find much on which to disagree with the Minister as regards my earlier amendments. As he said, it is very much a matter of how the new authority will work. The more I listened to what he said—and I shall read it carefully in Hansard—the more I realised that we shall have to examine Schedule 2 more carefully, and perhaps look to add detail there. The schedule can be changed by the Secretary of State by order. Therefore, it can be changed in any direction, in effect depending on the Secretary of State of the day. We shall want to make sure that Clause 1 says what it means to say and what the Government mean it to say. There is a tendency in the passage of legislation for the Government to say "This is what we think the Bill says. If we have got it wrong, we shall change it by order later". We should like to try to avoid that and get Clauses 1 and 3 right before the Bill leaves the House.

I am grateful to the Minister for his answers. We shall return to this issue. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

moved Amendment No. 3:

Page 1, line 19, after ("engaged") insert ("or suspected of being engaged").

The noble Lord said: We now come to the question of inspections. We propose adding the words in the amendment because the first point on inspections is that the inspectors employed by the authority will presumably not only inspect those who have licences, or are clearly engaged in activity which requires a licence, but will also, at the margin, look to see whether some people who do not have licences, and are not necessarily clearly engaged in licensable conduct, are engaged in conduct for which they should have a licence. Therefore, the inspectors will be able to check up on them and fine them if necessary, or ensure that they obtain a licence. If the inspectors find themselves rejected, as it were, by a firm that they think may require a licence but does not have one, they may have difficulty.

This question also raises more general points as to who and what the inspectors will inspect. Some in the industry have called for what they describe as mandatory inspections, which I take to mean that there would be a regular inspection once a year, or at some such period, of everybody with a licence. But that would be enormously expensive and not necessarily essential. We are all keen—I know that the Government are, as we are—to keep the regulations in proportion to the difficulties in this field.

The question of who and what will be inspected makes a difference to the number of inspections required. We know that several hundred thousand people will require licences. There are various estimates, but 300,000 is widely suggested. To have any reasonable inspection, even ongoing, of 300,000 people and the companies they work for, spread around the whole country, will take quite a large force of inspectors. That in itself will be reflected in the cost of the whole regime, which will fall on the industry. It would be helpful to know what kind of inspection is envisaged by the clause giving this duty to the authority. Flowing from that, how large a team of inspectors, roughly speaking, do the Government anticipate will be required to carry out this duty? I beg to move.

As I understand it, the amendment seeks to extend the authority's inspection function to those suspected of being engaged in licensable conduct. It seems to me to be a novel device for expanding the remit of the security industry authority.

We take the view that the security industry authority already has more than enough powers and teeth to enable it to carry out its inspection function using the provisions contained in Clause 18. After all, these powers would allow a person authorised by the authority to enter premises and to carry out inspections of the documents of any person appearing to be a regulated person. I suppose that "appearing" in these terms could be construed as being in some way similar to "suspected". This refers, broadly, to someone who has, or the authority believes ought to have, a licence. We consider the powers to be sufficient for the effective enforcement of the licensing system. For those reasons we do not think that the amendment is needed.

The White Paper looked at this question and suggested a low estimate in terms of numbers. We do not want to see a massive inspectorate but one which is proportionate to the size of the problem. In constructing the inspectorate we shall, of course, talk very carefully with the private security industry. If we were to expand the remit of the authority in the way suggested by the noble Lord's amendment, we would push those numbers up. As the authority will be financed through fees collected, that would tend to lead to an excessive burden on the industry. That is not what we want. We need to keep the numbers in proportion.

We expect the number of inspectors to be at the lower end of the range. I cannot be precise on numbers today. However, I undertake to take the matter away and do more research. Obviously, in constructing the size of the inspectorate, we shall consult carefully with the industry. In the light of those reassurances, I hope that the noble Lord will feel able to withdraw his amendment.

I am not sure whether the Minister was hinting that if my amendment was rewritten to say something like "persons appearing to be engaged in licensable conduct" it would be more acceptable. I am not trying to hold out any particular credit for the drafting used in my amendment as opposed to other drafting, but the Minister's words seem to indicate the difference between Clause 18, which allows powers of entry to premises owned or occupied by any person appearing to be a regulated person, and Clause 1 where it is only persons engaged in licensable conduct who are to be inspected. There appears to be a difference between the two clauses, the difference hinted at in my amendment. We may try again with different drafting to see if we can bring this matter into line. At this point, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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

House resumed.