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Select Committee on Public Administration First Report


Annex B


A draft civil service bill—commentary on clauses

CLAUSE 1—'THE CIVIL SERVICE OF THE STATE'

1. Clause 1 provides that 'the civil service of the State' shall continue to consist of every person who serves the Crown in a civil capacity, other than a holder of judicial or political office, and whose remuneration is paid wholly and directly out of moneys provided by Parliament. The suggested definition of 'the civil service of the State' is based on that produced by the Fulton Committee which reported on the civil service in 1968.

2. The expression 'civil service of the State' is drawn from a number of existing statutory references where the civil service is deliberately defined in the widest manner, so as to include, for example, the Home Civil Service, the Diplomatic Service, the Northern Ireland Civil Service (and the Northern Ireland Court Service) and the Forestry Commission. The expression 'civil service of the State' is found in the Aliens Restriction (Amendment) Act 1919, paragraph 2(4)(a) of Schedule 2 to the Ordnance Factories and Military Services Act 1984, section 2 of the Property Services and Crown Suppliers Act 1990, Schedule 5 to the Scotland Act 1998.

3. The purpose of referring to the 'civil service of the State' is to provide a framework for the application of the Act. It is not intended to provide for the constitution of the civil service, still less to create it as an institution. The basis for the creation of the civil service remains the power of the Crown to enter into arrangements in the nature of a contract for the employment of its servants. The exclusion of holders of judicial or political office is intended to exclude such servants and officers of the Crown as judges and Ministers. The reference to 'remuneration paid wholly and directly out of moneys provided by Parliament' is thought to be wide enough to include civil servants who work in departments whose operations are funded by a trading fund. In such cases, the moneys are provided by Parliament since the funding and operations of a trading fund require Parliamentary approval under the Government Trading Funds Act 1973.

4. In order to deal with any anomalous cases, clause 1(2) and (3) provides for a power exercisable by the Minister for the Civil Service by statutory instrument to include persons within the definition of the civil service in clause 1(1), or to exclude them. In the latter case, it is proposed that the affirmative procedure should apply, because the effect of such an order would take Crown servants outside the scope of such instruments as the Civil Service Code.

CLAUSE 2—CIVIL SERVICE COMMISSION

5. Clause 2 provides for the appointment of the Civil Service Commission on a statutory basis. (At present, the Commission is appointed under prerogative powers exercised by Order in Council). Appointment would be by Her Majesty consequent upon an address by the House of Commons. The suggested arrangement for obtaining the agreement of the Leader of the Opposition is similar to that which is provided for in relation to the Comptroller and Auditor General under s.1(1) National Audit Act 1983.

6. By virtue of clause 2(4) the resources required by the Commission would no longer fall on the Cabinet Office vote, but would be provided under estimates laid by the Public Accounts Commission. The provision is modelled on s.4 of the National Audit Act 1983.

7. Schedule 1 makes further provision in relation to the status and administration of the Commission as a statutory body.

CLAUSE 3—PRINCIPAL FUNCTIONS OF THE COMMISSION

8. The functions of the Commission are expressed in similar terms to those used in Article 4 of the Civil Service Order in Council 1995. The Commission accordingly has a duty to maintain the principle of selection on merit on the basis of fair and open competition. This duty is subject to the exceptions made in clause 5 (e.g. in relation to special advisers).

9. The function of entertaining appeals (which is presently conferred by Article 4(5) of the Civil Service Order in Council 1995) is expanded to include the hearing and determination of applications under the Civil Service Code. The purpose of this expansion is to permit the Commission to hear a complaint relating to the application of the Code in circumstances where a civil servant reasonably believes he will be subjected to detriment if he were to make an appeal on such a matter within his own department. The provision is linked to the provisions of clause 6(3) which will require the Code to contain a mechanism allowing a civil servant to apply to the Commission without first making an appeal.

10. Clause 3(3) confers a new power on the Commission to conduct such inquiries as it thinks fit into the operation of any code of conduct made under the Act. The power is intended to be wide enough to permit the Commission to undertake an inquiry entirely of its own motion or on receipt of representations by third parties. The power to conduct inquiries into recruitment of the civil service is similar to (but wider than) the existing power under Article 4(3) of the Civil Service Order in Council to audit recruitment policies and practices. Neither power is intended to involve the Commission in the day to day management of the civil service.

11. Clause 3(4) requires the Commission to report annually to Parliament and confers a power to lay such other reports as it thinks fit.

CLAUSE 4—EXERCISE OF FUNCTIONS BY THE COMMISSION

12. Clause 4 permits the Commission to delegate its functions to a single Commissioner or any officer. Clause 4(2) permits the delegation of recruitment functions along the lines of what is now permitted under Article 9 of the Civil Service Order in Council 1995. In particular, it allows the Commission to delegate to any person its functions under clause 3(2)(b) and (c) where it has already approved the arrangements for selection for particular appointments. This would allow the continuation of present practice whereby arrangements for selection for appointment are approved by the Commission.

CLAUSE 5—EXCEPTIONS FROM SELECTION ON MERIT

13. Clause 5 sets out the exceptions from the principle of selection on merit on the basis of fair and open competition. These correspond to the exemptions presently made under Article 3 of the Civil Service Order in Council. These exceptions would not prevent appointments being made on merit, but they would not be subject to oversight by the Commission under section 3. The situations under Clause 5(1)(b) are in practice those held by special advisers. Such persons are (as now) civil servants, but not subject to selection on merit on the basis of fair and open competition.

14. The holders of such situations are subject to the limitations set out in clause 5(2) and (3), except for the holders of up to two situations in the Prime Minister's Office which may be designated by him. The provision corresponds to that presently made by Article 3 of the Civil Service Order in Council. The limitations are not expressed in terms of 'giving advice', but in terms of the express prohibitions in clause 5(3) relating to authorising expenditure, exercising any management function or exercising any statutory power. A special adviser could not, therefore, execute any instrument required by statute (such as a Statutory Instrument or order) on behalf of a Minister.

15. Clause 5(4) limits the number of holders of such situations in the devolved administrations (as is currently provided for in Article 3(4) and (5) of the Civil Service Order in Council 1995). Clause 5(4) also provides a mechanism for the approval by each House of Parliament of a maximum number of appointments by Ministers of the Crown.

CLAUSE 6—CIVIL SERVICE CODE

16. Clause 6 provides for the making by the Minister for the Civil Service of a Civil Service Code. Clauses 6(2) and (3) provide for the minimum content of such a code. The provisions of Clause 6(2) are based on the existing provision made in the Civil Service Code. Clause 6(5) provides for the making of supplementary codes for special advisers. Any code made under this clause is subject to Parliamentary approval in accordance with the procedure in clause 6(6). This would allow amendments to be required by either House as a condition of approval. Clause 6(7) is a definitional provision to cater for the existence of devolved administrations.

CLAUSE 7—POWER TO MAKE ORDERS

17. Clause 7 provides the Minister for the Civil Service with a power to make orders for the management of the civil service, corresponding to the provision which is now made under Article 10 of the Civil Service Order in Council, and under which such instruments as the Civil Service Management Code are now made. Unlike that power (which does not involve any Parliamentary procedure), exercise of the statutory power would be by statutory instrument subject to the annulment procedure.

Part 2—nationality requirements

18. Part 2 of the draft Bill incorporates the provisions of the Bill introduced in 2002 by Mr Andrew Dismore MP, which addresses the problems caused by the Aliens Restriction (Employment) Act 1919.

BACKGROUND

19. The Act of Settlement of 1700 provides, in section 3, that no person born out of the kingdoms of England, Scotland or Ireland or the dominions thereto belonging should be capable of enjoying any office or place of trust, either civil or military, under the Crown. This prohibition does not apply to Commonwealth citizens or citizens of the Irish Republic (see section 52(6) of, and Schedule 7 to, the British Nationality Act 1981) or to British protected persons employed in a civil capacity (see section 1(1) of the Aliens' Employment Act 1955).

20. Section 6 of the Aliens Restriction (Amendment) Act 1919 provides that no alien shall be appointed to any office or place in the civil service of the State. An alien is now defined in section 51(4) of the British Nationality Act 1981 as a person who is neither a Commonwealth citizen nor a British protected person nor a citizen of the Republic of Ireland.

21. Under the Aliens' Employment Act 1955 the prohibitions were relaxed so that aliens could be employed if they were either:

a)  appointed in a country outside the UK, the Channel Islands and the Isle of Man in a capacity appearing to the Minister to be appropriate for aliens; or

b)  employed in accordance with a certificate issued by a Minister with the consent of the Minister for the Civil Service (this was originally with the consent of the Treasury but the function was transferred to the Minister for the Civil Service by the Transfer of Functions (Treasury and Minister for the Civil Service) Order 1995 (SI 1995/269)). In this connection either there must be no suitably qualified UK nationals available to do the work or the alien must possess exceptional qualifications or experience to do the job. Certificates last for 5 years and must then be renewed.

22. A list of the certificates issued under the 1955 Act and a statement of the number of persons employed under the certificates must be laid before Parliament by the Treasury. For the year 2001-2002 the number of certificates and persons employed under those certificates was 45.

23. The European Communities (Employment in the Civil Service) Order 1991 (SI 1991/1221) amended the 1955 Act so as to allow nationals of member states of the European Communities (and their spouses and certain children) to take up civil employment under the Crown apart from "public service" posts within the meaning of the EC Treaty (see Article 48(4) of the EEC Treaty, now Article 39(4) of the EC Treaty, which excludes from the freedom of movement of workers posts in the "public service").

24. The rights of nationals of member states of the European Communities were extended to nationals of member states of the European Economic Area by section 2(1) of the European Economic Area Act 1993.

25. In 1996 an amendment to the Civil Service Management Code was made to restrict Commonwealth and Irish nationals (who are not subject to the prohibitions in the Act of Settlement or the 1919 Act) from being employed in posts which were reserved for UK nationals. This put Commonwealth citizens and Irish nationals in the same position as nationals of other member states of the European Economic Area.

26. The effect of the existing rules, therefore, is that foreign nationals may be employed abroad in any civil post under the Crown (which includes the Diplomatic Service) if the Minister considers it appropriate. As regards civil employment, or the holding of office, under the Crown within the UK, Commonwealth Citizens, British protected persons and nationals of member states of the European Economic Area may be employed in posts other than reserved ones. Nationals of other countries may be employed in UK non-reserved posts only if a certificate is in force.

27. The exceptions made by the 1991 Order were made under secondary legislation (s.2(2) European Communities Act 1972). The limited scope of that power meant that the basic prohibition in the 1919 Act could not be entirely removed, but only amended to the extent necessary to comply with EC obligations. The EC Treaty (Article 39 EC) abolishes discrimination in employment on grounds of nationality, except in relation to 'employment in the public service' (Article 39(4)EC). There is therefore no obligation on Member States to admit other EU nationals to 'employment in the public service'. As far as the EC Treaty is concerned, Member States can employ EU nationals in such posts, but are not obliged to admit them. The 1991 Order could only reflect the UK's obligations under the EC Treaty, and could not amend the 1919 Act to any greater extent that was strictly required for that purpose.

28. This has given rise to a number of difficulties. As a matter of UK law, EU nationals can be admitted to civil service posts, but they cannot be admitted to ones which the European Court regards as 'employment in the public service'. Although the European Court interprets 'employment in the public service' narrowly, it nevertheless has taken the view that officials concerned e.g. in the collection of taxes are employed 'in the public service'. This has the result that, as a matter of the law of the UK, a national of an EU Member State could not generally be employed in the Inland Revenue, because this is a post which constitutes 'employment in the public service' within the meaning of Article 39(4)EC and therefore the exception from the 1919 Act does not apply, and a criminal offence is committed if he is so employed.

COMMENTARY ON PART 2 CLAUSES

Clause 8: Removal of restrictions as to nationality applying to civil employment or offices under the Crown

29. Subsection (1) provides that the general prohibition on the employment of certain aliens in section 3 of the Act of Settlement 1700 does not apply to employment, or the holding of office, in a civil capacity under the Crown.

30. Subsection (2) repeals section 6 of the Aliens Restriction (Amendment) Act 1919 (which, subject to exceptions, prevents the appointment of aliens to posts in the Civil Service).

Clause 9: Power to impose requirements as to nationality in relation to certain Crown appointments

31. Subsection (1) of clause 2 allows rules to be made reserving specified posts for certain specified nationalities. This would allow certain posts to be reserved for UK nationals where it was thought right that they should be carried out by UK nationals. Any rules made under this power would have to comply with the requirements both of the European Communities and of the European Convention on Human Rights.

32. Subsection (2) allows the rules to impose requirements as to nationality of persons who are related to, or living with, the person employed or holding office.

33. Subsection (3) provides that the rules be made by a Minister of the Crown or by such other officer of the Crown to whom the power has been delegated by a Minister.

34. Subsection (4) allows the rules to exempt persons who were first employed or held office before a specified date and allows the granting of exemptions to the rules in appropriate cases.

35. Subsection (5) provides that the granting of, or refusal to grant, exemptions shall not be subject to challenge under the Race Relations Act 1976.

Clause 10: Repeals and revocation

36. This clause brings the Schedule into effect. The Schedule repeals the Aliens' Employment Act 1955 as there is no need for it (or for the provisions amending it) once section 6 of the 1919 Act has been repealed and the scope of the Act of Settlement has been restricted by the Bill. The European Communities (Employment in the Civil Service) Order 1991 is therefore revoked.

37. Reference should be made to the Explanatory Notes accompanying that Bill.


 
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