Standing Committee A
Tuesday 27 March 2001
(Afternoon)
[Mr. Frank Cook in the Chair]
Clause 2
Meaning of ``burden'' and related expressions
Question proposed [this day], That the clause stand part of the Bill.
4.30 pm
Question again proposed.
Mr. Andrew Lansley (South Cambridgeshire): I am sure, knowing the attention that members of the Committee have paid to our debates, that they do not need me to reiterate what was said immediately prior to our adjournment.
As I was saying, the definition of ``burden'' in the Deregulation and Contracting Out Act 1994 does not include the Bill's new definition. In the Government's view, preventing the Government from incurring expenditure—for the benefit, presumably, of other persons—constitutes a burden. This is a matter of semantics into which I shall not delve too far, but to regard preventing the Government from incurring expenditure as a burden on the population at large is, to put it mildly, stretching a point. Indeed, some might think that so preventing the Government would be of considerable benefit to the public.
I fully understand why the Government want to phrase the provision in that way, and I am afraid that yet again I regard them as somewhat untrustworthy. They are trying to define as burdens matters that are not, on the ground that it will be convenient for them subsequently to make regulatory reform orders to achieve a specific objective.
In another place, Lord Falconer of Thoroton referred to the type of regulatory reform order that he had in mind. He said that the vaccine damage payments scheme might prompt the Government to introduce an order to lift the burden that currently prevents them from paying those whom they wish to pay. We need not detain ourselves discussing the merits of extending the scheme, because both Government and Opposition Members have acknowledged them. Prior to its inclusion in the possible uses to which such orders will be put, my right hon. Friend the Member for Richmond, Yorks (Mr. Hague) made it clear that he regarded the scheme as a suitable subject for legislation, but he also pointed out that this mechanism should not be used.
The mechanism, which is defined as a regulatory measure, will allow the Government to lift restrictions imposed through primary legislation on the circumstances in which they may make payments and incur expenditure. However, in the public's view, allowing the Government to spend more money is not a deregulatory measure, but precisely the sort of activity that should be subject to normal scrutiny by the House. The incurring of expenditure should be consequential only on measures in a regulatory reform order that are designed to achieve a substantive deregulatory purpose. Incurring expenditure and removing constraints on the Government is not a deregulatory measure, but the Government are trying to define it as such by including it in the definitions of ``burden''.
I shall not seek to divide the Committee on clause 2, but I seek reassurance from the Minister that the vaccine damage payments scheme, although wholly beneficial, is an exceptional example. Will the use of regulatory reform orders to allow the Government to incur expenditure, or to extend the terms on which it is incurred, occur in only the most exceptional circumstances?
The Parliamentary Secretary, Cabinet Office (Mr. Graham Stringer): There are two changes to the definition of a burden in the 1994 Act. The hon. Member for South Cambridgeshire (Mr. Lansley) has concentrated on the inclusion of a restriction on incurring expenditure in the definition of a burden. That definition clearly applies to vaccine-damaged children and to their families, who, under the definition in previous Acts, would have been paid nothing if their children were less than 80 per cent. damaged.
I can give the hon. Gentleman three assurances. First—and we are yet to reach this part of the debate—the normal consultation and deep consideration by two Committees will ensure that the process is not abused in the way in which he imagines. Secondly, this is not a blank cheque. The definition is concerned with an ability to spend in a particular area, and Parliament's processes for checking expenditure must be adhered to. One cannot agree to spend money through a regulatory reform order because Parliament and the Government must go through their normal procedures. Thirdly—this is admittedly an incomplete reassurance—we trawled for examples of cases in which the Bill could be used, but we found only a few. I do not envisage that the definitions will be used on many occasions, and I hope that he will be content with my two major reassurances.
Question put and agreed to.
Clause 2 ordered to stand part of the Bill.
Clause 3
Limitations on order-making power
Mr. Lansley: I beg to move amendment No. 8, in page 3, line 2, leave out
`the Minister making the order is of the opinion that'.
The Chairman: With this we may discuss the following amendments: No. 9, in clause 3, page 3, line 8, leave out
`the Minister is of the opinion'.
No. 10, in clause 3, page 3, line 9, leave out `that'.
No. 11, in clause 3, page 3, line 12, leave out `that'.
Mr. Lansley: Amendments Nos. 8 to 11 are designed around the specific objective of removing from the structure of the Bill the provision that, in applying the four tests, which are subsequent to the objectives of the order-making power in clause 1, a Minister must form an opinion. The amendments would make the four tests less subjective and more objective.
It may be helpful if I refer to each amendment and make it clear which does what. Amendments Nos. 8 and 9 are substantive; amendments Nos. 10 and 11 are consequential. Amendments Nos. 8 and 9 both relate to clause 3(1), which concerns two tests. The first test is that the order should not ``remove any necessary protection''. The second test in clause 3(1)(b) is a new test that goes beyond the Deregulation and Contracting Act 1994. It states that the order should not
``prevent any person from continuing to exercise any right or freedom which he might reasonably expect to continue exercise.''
That, for convenience, is called the reasonable expectations test.
Those two tests are currently in the structure of the Bill. A Minister making the order must be of the opinion that the order does not remove either reasonable expectations or necessary protection. The purpose of amendment No. 8 is to remove the subjective view of the Minister on those two matters.
Amendment No. 9 concerns clause 3(2)(a) and (b), which describe the two other tests. Paragraph (a) states that the first test should
``strike a fair balance between the public interest and the interests of the persons affected by the burden being created''.
Paragraph (b), the desirability test, states that the order may create a burden if the Minister is of the opinion
``that the extent to which the order removes or reduces one or more burdens, or has other beneficial effects for persons affected by the burdens imposed by existing law, makes it desirable for the order to be made.''
In subsection (2), we are talking about circumstances where burdens have been created.
In respect of Amendment No. 9, it is difficult to be sure under what circumstances the two tests would be used. Ministers propose to introduce the new tests but they have obviously not been tested in the context of the Deregulation and Contracting Out Act 1994. There is no reason to suppose that ``a fair balance'' as determined by a Minister would be challengeable by the courts. I am equally unsure why it would be a problem to remove the opinion of the Minister in those circumstances, and to term the Bill so that the order would be one that struck a fair balance and was desirable in the agreed views of the Minister, the Select Committees and the House. Any court that wished to challenge the two tests would have to prove that they had not been applied, or had been applied unreasonably.
To insert the reference that the Minister is ``of the opinion'' is to take the tests that the courts would have to apply a step further. The question would be not simply whether the tests had been applied unreasonably, but whether no reasonable Minister could have arrived at such an opinion and that is not what we want. The Committee wants the exceptional power and scrutiny provisions provided by the Bill to be used in circumstances where there is a clear demonstrable instance of benefit, which is not controversial or likely to be challenged. That is the more difficult ambition of amendment No. 9.
Amendment No. 8 is more straightforward and I would like the Minister to explain why he will not accept it. The test of necessary protection already exists in section 3(4)(b) of the 1994 Act and it is not subject to the Minister's opinion. As far as I am aware, in the 48 instances in which the deregulation and contracting out orders have been used, that test has not been challenged by the courts and has worked well. I do not understand why it is necessary to put into the structure of the Bill the test of a Minister's opinion. If necessary protection is proof against legal challenge, and Ministers in the past have exercised the power well, why can the test of reasonable expectation not be the subject of a similar provision, without the intrusion of a Minister's opinion?
I apologise to the Committee if I appear to be labouring the point, but there is a difficulty. Clause 3(1) states that the Minister making the order must be
``of the opinion that the order does not . . . prevent any person from continuing to exercise any right or freedom which he might reasonably expect to continue to exercise.''
It is surely abridging the reasonable expectations test that we set out to protect. If a person has reasonable expectations, a court will uphold them, even if Ministers, the Select Committee and the House should fail to uphold them as we would hope. However, including
``the Minister is of the opinion'',
creates a circumstance, for a person with reasonable expectations, in which it would be necessary to demonstrate in court that the Minister was not of that opinion. In such a case, those reasonable expectations might be frustrated, without any possibility of a successful legal challenge.
4.45 pm
Although we are working somewhat in the dark on amendment No. 9, I cannot see the necessity of including the test of a Minister's opinion. It strikes me as objectionable. I hope that I might stir my colleagues and other hon. Members to support amendment No. 8, which concerns necessary protection and reasonable expectations. It seems clear that, in line with the legislation that the Bill replaces, the intrusion implied by the words is not only unnecessary but undesirable.
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