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Mrs. Liddell: There we have it--soft on price fixers and soft on the causes of price fixing. [Interruption.] At this time of night, I always find it best to be catchy.

27 Jul 2000 : Column 1355

I resist these Opposition amendments to the Bill's financial penalty provisions. As the hon. Member for Bognor Regis and Littlehampton (Mr. Gibb) said, amendment (a) to Lords amendment 74 and amendment (a) to Lords amendment No. 127 seek to replace the cap of 10 per cent. of turnover with a cap of 5 per cent. of turnover. The Government have been consistent on this point. We have always maintained that the primary constraint on the level of any financial penalty is the requirement for the penalty to be reasonable in all the circumstances of the case.

We initially resisted the imposition of the cap on penalties on the ground that it was not strictly necessary, but we have also listened to the views of groups inside and outside the House and responded to the growing view that a limit would provide some comfort to companies without unduly constraining the authority's ability to protect consumers' interests.

Now that we have done that, the Opposition want to move the goalposts again. No one gains from that. The Government have already done everything that is necessary to respond to the concerns that have been put to us about these provisions. We have introduced a cap on penalties, as requested, analogous to that in the Competition Act 1998, which seemed to be the example that the Opposition referred to most often in Committee and elsewhere when pressing for a cap.

The only possible reason for wanting to introduce a lower cap is to protect companies from facing a penalty that would be reasonable in all the circumstances of the case when they have committed a serious contravention. A cap of 5 per cent. of turnover would run that risk, and on that basis the Government cannot accept it.

Amendments (b) and (c) to Lords amendment No. 74 and amendments (b) and (c) to Lords amendment No. 127 would insert provisions in the Bill to the effect that the definition of turnover used in relation to the cap on financial penalties shall be the UK turnover of the licence holder in the year preceding the imposition of the penalty.

The Lords amendment inserting a limit on financial penalties also states that detailed provisions in relation to the definition of turnover and other matters shall be set out in an order made by the Secretary of State by affirmative resolution. There will therefore be ample opportunity for Parliament to discuss the relevant provisions when the order is made. The definition that the Opposition amendments would insert would pre-empt the debate that will take place when the order is made. The amendments are therefore unnecessary.

Amendment (b) to Lords amendment No. 75 and amendment (b) to Lords amendment No. 128 have been linked--very tenuously--to a part of the financial penalties provisions that prevents penalties from being applied retrospectively. The amendment tabled in another place was purely technical.

The amendments to the Lords amendments are an attempt to reintroduce a provision that penalties shall be limited to cases of recklessness and intent, similar to the Competition Act 1998 restriction to cases of negligence and intent. The Government have resisted amendments to that effect throughout the passage of the Bill, on the ground that the onus should be on companies to comply with their licence conditions and that such an amendment would work against the interests of consumers.

27 Jul 2000 : Column 1356

As my noble Friend Lord McIntosh explained in another place, there are valid precedents for our approach, such as the National Lottery Act 1998 and the Broadcasting Acts 1990 and 1996, which were introduced under the previous Administration. Those Acts provide for the relevant regulatory authority to impose financial penalties for contraventions of licence conditions. They do not provide get-out clauses for companies that breach their licences without negligence or intent. There are good reasons for the approach that the Government have adopted.

We hold to the view that the onus should be on the licence holder to maintain compliance, especially when the consumers concerned cannot move to another service provider, as is the case with the electricity transmission and distribution companies and the gas transporters.

The amendments to the Lords amendments ignore entirely the nature of the powers that we are providing. The authority will have a power, not a duty, to impose financial penalties. Any penalty that it imposes must be reasonable in all the circumstances of the case. It seems most unlikely that any penalty that did not take account of best endeavours by a licence holder to remedy a contravention would be considered reasonable in all the circumstances of the case, and any such penalty would without doubt be liable to challenge in the courts. Consumers none the less deserve proper protection, and the amendments do not help in that respect.

For all the reasons that I have set out, I cannot accept the Opposition's proposals. I hope that the hon. Gentleman will not press the amendments to a vote but, if he does, I am afraid that we must oppose them.

Lords amendment agreed to.

Lords amendment: No. 74, in page 56, line 39, at end insert--

("(6A) No penalty imposed by the Authority under this section may exceed 10 per cent. of the turnover of the licence holder (determined in accordance with provisions specified in an order made by the Secretary of State).
(6B) An order under subsection (6A) shall not be made unless a draft of the instrument containing it has been laid before and approved by a resolution of each House of Parliament.")

Amendment proposed to the Lords amendment: (c), leave out from "holder" to end and insert--

'the turnover being determined on the applicable turnover for the business year preceding the date when the infringement ended and shall in any case not exceed a period of 12 months'.--[Mr. Gibb.]

Question put, That the amendment to the Lords amendment be made:--

The House divided: Ayes 120, Noes 257.

Division No. 297
[7.10 pm


Ainsworth, Peter (E Surrey)
Amess, David
Arbuthnot, Rt Hon James
Atkinson, Peter (Hexham)
Baldry, Tony
Bercow, John
Beresford, Sir Paul
Blunt, Crispin
Body, Sir Richard
Boswell, Tim
Bottomley, Peter (Worthing W)
Bottomley, Rt Hon Mrs Virginia
Brady, Graham
Brazier, Julian
Brooke, Rt Hon Peter
Browning, Mrs Angela
Bruce, Ian (S Dorset)
Butterfill, John
Cash, William
Chapman, Sir Sydney
(Chipping Barnet)
Clappison, James
Clarke, Rt Hon Kenneth
Collins, Tim
Cormack, Sir Patrick
Cran, James
Davies, Quentin (Grantham)
Davis, Rt Hon David (Haltemprice)
Day, Stephen
Duncan Smith, Iain
Evans, Nigel
Fabricant, Michael
Fallon, Michael
Flight, Howard
Forth, Rt Hon Eric
Fox, Dr Liam
Fraser, Christopher
Gale, Roger
Garnier, Edward
Gibb, Nick
Gill, Christopher
Gillan, Mrs Cheryl
Gorman, Mrs Teresa
Gray, James
Green, Damian
Greenway, John
Grieve, Dominic
Gummer, Rt Hon John
Hague, Rt Hon William
Hamilton, Rt Hon Sir Archie
Hammond, Philip
Hawkins, Nick
Hayes, John
Heald, Oliver
Heathcoat-Amory, Rt Hon David
Horam, John
Howard, Rt Hon Michael
Jack, Rt Hon Michael
Jenkin, Bernard
Johnson Smith,
Rt Hon Sir Geoffrey
Key, Robert
King, Rt Hon Tom (Bridgwater)
Kirkbride, Miss Julie
Laing, Mrs Eleanor
Lait, Mrs Jacqui
Lansley, Andrew
Leigh, Edward
Letwin, Oliver
Lidington, David
Lloyd, Rt Hon Sir Peter (Fareham)
Loughton, Tim
Luff, Peter
Lyell, Rt Hon Sir Nicholas
MacGregor, Rt Hon John
McIntosh, Miss Anne
MacKay, Rt Hon Andrew
Maclean, Rt Hon David
McLoughlin, Patrick
Madel, Sir David
Malins, Humfrey
Maples, John
Maude, Rt Hon Francis
May, Mrs Theresa
Moss, Malcolm
Nicholls, Patrick
Norman, Archie
O'Brien, Stephen (Eddisbury)
Ottaway, Richard
Paice, James
Paterson, Owen
Pickles, Eric
Prior, David
Robathan, Andrew
Rowe, Andrew (Faversham)
Ruffley, David
St Aubyn, Nick
Shepherd, Richard
Simpson, Keith (Mid-Norfolk)
Spelman, Mrs Caroline
Spicer, Sir Michael
Spring, Richard
Stanley, Rt Hon Sir John
Streeter, Gary
Swayne, Desmond
Syms, Robert
Tapsell, Sir Peter
Taylor, Ian (Esher & Walton)
Tredinnick, David
Trend, Michael
Tyrie, Andrew
Viggers, Peter
Waterson, Nigel
Wells, Bowen
Whitney, Sir Raymond
Whittingdale, John
Widdecombe, Rt Hon Miss Ann
Wilkinson, John
Willetts, David
Wilshire, David
Yeo, Tim
Young, Rt Hon Sir George

Tellers for the Ayes:

Mr. Geoffrey Clifton-Brown and
Mr. John Randall.


Abbott, Ms Diane
Ainsworth, Robert (Cov'try NE)
Alexander, Douglas
Allen, Graham
Anderson, Donald (Swansea E)
Anderson, Janet (Rossendale)
Armstrong, Rt Hon Ms Hilary
Ashton, Joe
Atkins, Charlotte
Austin, John
Banks, Tony
Barnes, Harry
Barron, Kevin
Beard, Nigel
Beith, Rt Hon A J
Bell, Stuart (Middlesbrough)
Benn, Hilary (Leeds C)
Benn, Rt Hon Tony (Chesterfield)
Bennett, Andrew F
Benton, Joe
Best, Harold
Betts, Clive
Blears, Ms Hazel
Blizzard, Bob
Boateng, Rt Hon Paul
Bradley, Keith (Withington)
Bradley, Peter (The Wrekin)
Bradshaw, Ben
Brinton, Mrs Helen
Brown, Rt Hon Nick (Newcastle E)
Buck, Ms Karen
Burden, Richard
Burnett, John
Byers, Rt Hon Stephen
Cable, Dr Vincent
Caborn, Rt Hon Richard
Campbell-Savours, Dale
Cann, Jamie
Caplin, Ivor
Casale, Roger
Caton, Martin
Cawsey, Ian
Chapman, Ben (Wirral S)
Clark, Rt Hon Dr David (S Shields)
Clark, Paul (Gillingham)
Clarke, Tony (Northampton S)
Clelland, David
Clwyd, Ann
Coaker, Vernon
Coffey, Ms Ann
Cohen, Harry
Coleman, Iain
Colman, Tony
Cook, Frank (Stockton N)
Cooper, Yvette
Corbett, Robin
Corbyn, Jeremy
Corston, Jean
Cousins, Jim
Cox, Tom
Cryer, John (Hornchurch)
Cummings, John
Cunningham, Jim (Cov'try S)
Darvill, Keith
Davey, Edward (Kingston)
Davey, Valerie (Bristol W)
Davies, Rt Hon Denzil (Llanelli)
Davies, Geraint (Croydon C)
Dawson, Hilton
Denham, John
Dismore, Andrew
Doran, Frank
Dunwoody, Mrs Gwyneth
Eagle, Angela (Wallasey)
Eagle, Maria (L'pool Garston)
Edwards, Huw
Ellman, Mrs Louise
Ennis, Jeff
Field, Rt Hon Frank
Fisher, Mark
Fitzpatrick, Jim
Fitzsimons, Mrs Lorna
Flint, Caroline
Flynn, Paul
Follett, Barbara
Foster, Rt Hon Derek
Foster, Don (Bath)
Foster, Michael Jabez (Hastings)
Foster, Michael J (Worcester)
Fyfe, Maria
George, Bruce (Walsall S)
Gerrard, Neil
Gibson, Dr Ian
Godman, Dr Norman A
Godsiff, Roger
Gordon, Mrs Eileen
Griffiths, Jane (Reading E)
Griffiths, Win (Bridgend)
Grocott, Bruce
Grogan, John
Gunnell, John
Hall, Mike (Weaver Vale)
Hall, Patrick (Bedford)
Hamilton, Fabian (Leeds NE)
Harvey, Nick
Heal, Mrs Sylvia
Healey, John
Hepburn, Stephen
Heppell, John
Hesford, Stephen
Hewitt, Ms Patricia
Hill, Keith
Hinchliffe, David
Hodge, Ms Margaret
Hoon, Rt Hon Geoffrey
Hopkins, Kelvin
Howarth, Alan (Newport E)
Howells, Dr Kim
Hughes, Ms Beverley (Stretford)
Hughes, Kevin (Doncaster N)
Hurst, Alan
Hutton, John
Iddon, Dr Brian
Illsley, Eric
Jackson, Ms Glenda (Hampstead)
Jackson, Helen (Hillsborough)
Jamieson, David
Jenkins, Brian
Johnson, Alan (Hull W & Hessle)
Johnson, Miss Melanie
(Welwyn Hatfield)
Jones, Dr Lynne (Selly Oak)
Jones, Martyn (Clwyd S)
Jowell, Rt Hon Ms Tessa
Keeble, Ms Sally
Keen, Alan (Feltham & Heston)
Keen, Ann (Brentford & Isleworth)
Kennedy, Jane (Wavertree)
Khabra, Piara S
Kidney, David
King, Andy (Rugby & Kenilworth)
Ladyman, Dr Stephen
Laxton, Bob
Leslie, Christopher
Lewis, Ivan (Bury S)
Lewis, Terry (Worsley)
Liddell, Rt Hon Mrs Helen
Linton, Martin
Lloyd, Tony (Manchester C)
McAvoy, Thomas
McCabe, Steve
McCafferty, Ms Chris
McDonagh, Siobhain
McDonnell, John
McGuire, Mrs Anne
McIsaac, Shona
McKenna, Mrs Rosemary
Mackinlay, Andrew
McNamara, Kevin
McNulty, Tony
McWalter, Tony
Mahon, Mrs Alice
Mallaber, Judy
Marshall, David (Shettleston)
Marshall, Jim (Leicester S)
Meacher, Rt Hon Michael
Merron, Gillian
Michael, Rt Hon Alun
Michie, Bill (Shef'ld Heeley)
Miller, Andrew
Moffatt, Laura
Moran, Ms Margaret
Morgan, Ms Julie (Cardiff N)
Morley, Elliot
Morris, Rt Hon Ms Estelle
(B'ham Yardley)
Mountford, Kali
Mullin, Chris
Naysmith, Dr Doug
O'Brien, Bill (Normanton)
O'Brien, Mike (N Warks)
Olner, Bill
Öpik, Lembit
Palmer, Dr Nick
Pearson, Ian
Perham, Ms Linda
Pickthall, Colin
Pike, Peter L
Plaskitt, James
Pollard, Kerry
Pond, Chris
Pope, Greg
Pound, Stephen
Powell, Sir Raymond
Prentice, Ms Bridget (Lewisham E)
Prentice, Gordon (Pendle)
Prosser, Gwyn
Quin, Rt Hon Ms Joyce
Quinn, Lawrie
Radice, Rt Hon Giles
Rammell, Bill
Rapson, Syd
Reed, Andrew (Loughborough)
Rendel, David
Robinson, Geoffrey (Cov'try NW)
Rogers, Allan
Rooker, Rt Hon Jeff
Rooney, Terry
Ross, Ernie (Dundee W)
Ruddock, Joan
Salter, Martin
Sarwar, Mohammad
Savidge, Malcolm
Sawford, Phil
Sedgemore, Brian
Shaw, Jonathan
Sheerman, Barry
Shipley, Ms Debra
Skinner, Dennis
Smith, Jacqui (Redditch)
Snape, Peter
Soley, Clive
Southworth, Ms Helen
Spellar, John
Starkey, Dr Phyllis
Stewart, Ian (Eccles)
Stinchcombe, Paul
Stoate, Dr Howard
Strang, Rt Hon Dr Gavin
Stuart, Ms Gisela
Stunell, Andrew
Sutcliffe, Gerry
Taylor, Rt Hon Mrs Ann
Taylor, Ms Dari (Stockton S)
Temple-Morris, Peter
Thomas, Gareth R (Harrow W)
Timms, Stephen
Trickett, Jon
Turner, Dr George (NW Norfolk)
Turner, Neil (Wigan)
Twigg, Derek (Halton)
Twigg, Stephen (Enfield)
Tyler, Paul
Vis, Dr Rudi
Walley, Ms Joan
Ward, Ms Claire
Wareing, Robert N
Watts, David
Whitehead, Dr Alan
Wicks, Malcolm
Williams, Rt Hon Alan
(Swansea W)
Williams, Mrs Betty (Conwy)
Wills, Michael
Winnick, David
Wood, Mike
Woodward, Shaun
Woolas, Phil
Wright, Anthony D (Gt Yarmouth)
Wyatt, Derek

Tellers for the Noes:

Mr. Jim Dowd and
Mr. Don Touhig.

Question accordingly negatived.

27 Jul 2000 : Column 1359

Lords amendment No. 74 agreed to.

Lords amendments Nos. 75 to 94 agreed to.

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