Examination of Witnesses (Questions 560
- 579)
MONDAY 21 NOVEMBER 2005
FIONA MACTAGGART
MP, MR ADAM
SMITH AND
MR NICK
FUSSELL
Q560 Gwyn Prosser: Minister, in your
opening remarks you said on this issue of individual liability
the starting point was that this was a Bill designed to prosecute
corporations, and large corporations, and you made some reference
to Labour Party discussions. Would you not agree with me that
during the discussions and the speeches made at the 1997 Labour
Party Conference, and subsequent manifesto promises, individual
liability of directors was also at the heart of those discussions?
Is it not true that our Government's first proposals for a Corporate
Manslaughter Bill included individual liability?
Fiona Mactaggart: It did. Part
of the difficulty that that fell into was that the original proposals
created some objections from other interests. You have raised
the issue of the Labour Party's own internal discussions. The
Labour Party had quite profound internal discussions about this
and the Warwick Agreement agreed that the approach set out in
this Bill should be an approach which could command support, partly
because it managed to balance the different aspirations for dealing
with the issue of corporate manslaughter in a way which could
command consent from different parties. I think that is the reason
why that happened at that meeting at Warwick.
Q561 Gwyn Prosser: Do you think that
it would be unfair to say that the Government's initial thinking,
supported by the Party itself, has been thrown off course by pressure
from big business and from the CBI in particular?
Fiona Mactaggart: No, I do not.
First of all, the issue of individual liability for manslaughter
within a corporate failure is inevitably going to be difficult
to prove in a big company. What one effectively needs is first
of all to make sure that in big companies we can hold the company
to account. Secondly, to make sure that where individuals have
individual responsibility for failing, that they can be held to
account under health and safety legislation. The question then
is, is there a sufficient penalty for an individual in those circumstances.
One of the things that happens is that under health and safety
legislation there are unlimited fines. These are not very often
applied in a very substantial way and one of the things that we
need to look at is whether some of those offences can be more
effectively applied. This is quite a simple Bill in a way, it
has got intellectual coherence and I think in that regard we can
command support for it. So far someone has always thought of something
more important and more urgent to do. I am very keen that we do
not find something more important and more urgent to do and we
have a Bill that will not be pushed off course.
Q562 Harry Cohen: Can I follow up
very briefly on the Warwick Agreement. You said the Warwick Agreement
agreed corporate manslaughter legislation but surely it did not
go into any detail about what that legislation should be.
Fiona Mactaggart: The draft Bill
was published at the time of the Warwick Agreement.
Q563 Gwyn Prosser: Surely it did
not in any explicit way exclude any individual liability?
Fiona Mactaggart: No, I do not
think it did but, as I say, the draft Bill was published at the
time. I was not a party to the discussions but I am quite sure
that all the parties were aware of what was the probable proposal.
Q564 Chairman: Just very briefly,
hopefully: we were told in an earlier evidence session that if
this Bill is enacted as it stands we anticipate five prosecutions
a year, that is all.
Fiona Mactaggart: Five additional
prosecutions. I imagine that many of the existing prosecutions
will be more likely to be successful.
Q565 Mr Rooney: I specifically asked
if there was any instance of a major prosecution in the last 15
years that failed that would succeed under this Bill, and I was
told no. I would suggest to you that the Bill as currently in
place will not achieve the objectives that the Home Office seem
to have set for it. If we go back to the Herald of Free Enterprise,
the Marchioness, all of these, none of those would have
succeeded under this Bill. That is what we were told.
Fiona Mactaggart: You asked about
past cases which might have had a different outcome under the
new offence, and of course it is very difficult to say if a past
case would have a different outcome. That is because the jury
has to decide whether the behaviour amounts to gross negligence.
The problem with past cases is that in many of the difficulties
of prosecution there had to be the question of a directing mind,
a responsible—
Q566 Mr Rooney: I understand that.
I asked this specific question of the people who were in this
room: had this Bill been in force would any of the major prosecutions
in the last 15 years that failed have succeeded and I was told
no. That suggests to me that the Bill is in some way deficient.
Fiona Mactaggart: I was not the
person who told you no. I have been advised, and I do not know
if Adam would like to add to this, that in past cases the identification
principle—if you look at the Herald of Free Enterprise
there was criticism of sloppy management and so on—has been
the principle which has prevented prosecution, so there might
have been cases which were not prosecuted, or led to a failed
prosecution. I do not know if you would like to add to that on
past cases because you are more aware of the history of litigation
in this field than I am.
Mr Smith: I think the point is
that there is a very high threshold in the offence of gross negligence
which applies now which makes it very difficult to go back over
cases and say, "We can now say without any doubt that X company
in X position was guilty of gross negligence" when there
have been findings that those companies are not guilty. Two things
are clear. The first is that when the Law Commission was considering
the approach on which this Bill is based, their view was that
the prosecution—on the facts of the Herald of Free Enterprise—could
be capable of being left to a jury in a way under their Bill that
could not have been done before. That is certainly the case under
the proposals as we have got them. Whether a jury would then agree
that that was gross negligence I think is a second matter. I think
that is the difficulty with saying these are convictions. The
second point is that there have been other cases, and I think
this underlines how the identification principle is such a problem,
where the judges have contrasted the fact that individuals themselves
were not to blame with the fact that there have been very serious
cases of corporate negligence. That was most recently the case
at the end of the Hatfield prosecution. The court on the one hand
said that individuals were guilty of no more than errors of judgment.
On the other hand the judge thought that the facts as presented
to him represented one of the worst cases of industrial negligence
he had ever seen. What that indicates is that there is a very
urgent need to be able to put these sorts of cases to the jury
on a different basis to what individuals were doing.
Q567 Chairman: What the Minister
is saying to us, if we take the Hatfield case, is: suppose this
law had been in place and it had been possible to have a prosecution
for corporate manslaughter; the companies may have been convicted
but the position so far as the individuals were concerned would
be absolutely unchanged because there will be no increased liability
for individuals. What we need to be perfectly clear about is that
that is the Government's position, that that is the best obtainable
outcome under this legislation. Is that right?
Fiona Mactaggart: Yes. Can I add
one particular way in which things would change? With the lifting
of crown immunity there is a whole class of cases which currently
could not be prosecuted which would be.
Q568 Natascha Engel: This is about
the senior management test which again has been an issue during
most of the inquiry. Many witnesses have argued that the restriction
of the offence to failures by an organisation's senior managers
is problematic. We have also heard evidence that the Law Commission's
proposals were too broad as they would include management even
at supervisory level, so a sort of delegation. Given that there
has been a massive debate about definitions and the senior management
test, has the Home Office done any more thinking on this particular
issue and do you have any suggestions as to how any of the problems
that have come out during this inquiry about the senior management
test might be resolved?
Fiona Mactaggart: I suppose one
of the things that I was hoping was that your scrutiny might help
us to deal with this problem, let us be quite honest about it,
because you are quite right that the Law Commission's initial
arrangement could potentially capture some supervisory level,
a shop manager or someone, who is merely not following the standard
company procedure, and that is not what we intend to be the outcome
of this. Is the way that we have framed the test a way which genuinely
can capture the major management of an enterprise, those who are
profoundly fundamentally responsible? We hope so, but if it does
not then we would certainly wish it to. We did not think that
management failure at a low level should be able to be caught
but our aim is to make sure that wider corporate management failings,
those who are actually responsible for the corporate business
of the company, should be the right test. I would certainly welcome
the advice of this committee about whether we have got the focus
right or whether there is a different way of casting that particular
test. If we share a view that it should be at a senior level I
would very much welcome advice on how to frame that as the kind
of thing which pre-legislative scrutiny can help to drill down
into and, I hope, end up with a better Bill as a result of it.
Q569 Natascha Engel: From what you
were saying before though, about trying to target the very large
corporations which are not captured at the moment, that again
goes right into the issue, which is that it is a distinction between
the larger corporations and the small companies. The smaller companies
and the directors of smaller companies are the ones that are successfully
prosecuted. Is that what you are saying, that the emphasis will
be on those larger corporations?
Fiona Mactaggart: No, I am not
saying that. What I am saying is that the problem with the present
offence is that you need to find the directing mind. That is very
difficult to do in a large complex corporation so we have tried
to provide something which is a simpler test which requires a
senior level of management but does not drill down to the directing
mind point. It is going to be different between different companies
of different sizes and different complexity. What we do not want
to do is catch the relatively junior manager who is operating
in the context of a company policy which somebody is responsible
for, if you see what I mean. As to whether you need to say that
that seniority requires you to have some engagement on the broader
company policy, I do not know how exactly we frame that. We hoped
that the senior manager test did that. If it does not do that
we want a test which does that rather than deals with the person
who is just dealing with a part of the operation or something
which is, say, a branch of Gap as opposed to the whole of Gap,
if you see what I mean. I am sorry to pick on one particular company.
It seems to me that to get a corporate manslaughter charge for
someone who is at a relatively senior level it does not need to
be a person. It needs to be a process at a relatively senior level
that is responsible for this.
Q570 Harry Cohen: Minister, you said
right at the beginning that you wanted this to apply to corporate
bodies, but what about unincorporated ones—partnerships,
sole traders and others, such as clubs and associations, which
are excluded from the scope of this offence under the current
Bill? Organisations like the Transport and General Workers' Union
have told us that that would lead to "well over half a million
workers, as well as the millions of ordinary citizens who come
into contact with these various organisations, beyond the protection
of the law", and they argue for the employing organisations
to be in the Bill. Should not unincorporated bodies be included
as a matter of principle?
Fiona Mactaggart: Employing organisations
have responsibilities in health and safety law. Sole traders are
individuals who could be individually prosecuted. There are quite
a lot of organisations which are generally thought of as unincorporated
associations who have used some of the new incorporated forms
of associations, so that, for example, a large number of partnerships
which are traditionally unincorporated have now become corporate
bodies. What we are seeking to do is to try and get an offence
which is directed at organisations that exist, not at the individuals
who are responsible but at an organisation that exists. You need
an organisation and that is why it is a corporate manslaughter
offence, that is why we have focused on corporations. There is
a risk, and I do not think there is a big scale issue here and
we are not trying to duck it, for some small unincorporated bodies,
voluntary organisations and so on, who do not have a corporate
existence to become very fearful as a result of this legislation
and extremely risk averse. I was advised of a voluntary body which
was providing transport services on a community basis which felt
that it would require them to individually check at every booking
the licence and insurance of the individual driver at every point.
That was due to a misunderstanding of the kinds of health and
safety obligations that were upon them but that is the sort of
anxiety which is most likely to arise in the kinds of unincorporated
bodies which do not have the infrastructure that corporate entities
do on the whole—there are, of course, some unincorporated
associations which do have quite substantial infrastructure—but
that class of body might be quite destroyed by their fearfulness
of the risk of doing this. And it might be, for example, that
some of these bodies do not have the same people at the time you
get around to a prosecution from the time when the offence actually
occurred and there is no corporate body. That is really why we
focused on using bodies that exist for this corporate manslaughter
offence. If there is somebody who is a partner or a responsible
individual as part of a partnership or some unincorporated association,
they can be proceeded against individually, but you need a body
to proceed against corporately.
Q571 Harry Cohen: I understand that
point and I think it is right to focus on the corporate side.
Nevertheless, on this point of being fearful and risk averse,
they might have caused a death by their actions, it may have been
an employee or a member of the public, and they would have this
safeguard presumably if they met the appropriate standards of
health and safety (or whatever the duties were) as a defence anyway.
Surely what we are creating here is a bit of a loophole for some
of these organisations. Health and safety legislation, for example,
applies to some unincorporated bodies, so why could that not apply
to them?
Fiona Mactaggart: Let us be completely
clear: all employers are responsible for the health and safety
of their employees. They have a health and safety duty as an employer
and they have a responsibility to ensure that the appropriate
standards are adhered to in terms of their health and safety duties.
What this offence is about is punishing bodies when as a body
they have committed this very serious offence of manslaughter.
You need a body to commit it, if you see what I mean. I do not
think that you can say that you can punish a body which is not
a body. That is our difficulty. If there is no such body to do
that, it makes little sense. You could prosecute them in terms
of their health and safety liabilities as an employer, which is
the most likely occasion on which it might arise, but actually
I do not think you could give them a corporate responsibility
if they are not a corporation.
Q572 Harry Cohen: I hear that but
I think you are right about the health and safety powers there,
and in fact individual manslaughter could come in.
Fiona Mactaggart: It would under
these circumstances.
Q573 Harry Cohen: Let me just give
you an example of an unincorporated firm. A lot of law firms are
unincorporated but we would really recognise them as bodies or
as an organisation that could have a legal entity if they took
some policy judgment that caused the death of someone.
Fiona Mactaggart: I did discuss
this with my advisers earlier today. Mr Fussell pointed out the
status of a number of law firms. Can I hand over to him on that
particular point and then I will come back?
Mr Fussell: As the Minister said
earlier, many law firms now are limited liability partnerships
but with the law firms that are not limited liability partnerships
there is the issue that the Minister has highlighted, namely,
that they have a number of partners who are the body on the day
of the death and then a few years down the line who are you prosecuting
if all the partners have changed if there is no corporate entity
prosecuted?
Fiona Mactaggart: One of our difficulties
is that we have to draw a line somewhere and the easiest way to
draw a line is where there actually is a corporate entity rather
than trying to turn something which is not an entity into an entity.
Q574 Gwyn Prosser: Minister, the
Bill in its present form excludes police forces from its contents
but we understand that the Government want to bring them back
into the scope of the Bill. Can you tell us what difficulties
there are in doing that and whether you have resolved them yet?
Fiona Mactaggart: We do intend
to make it apply to police forces. There are two options about
how to do that. One is to build on the way in which the Health
and Safety Executive has held police forces accountable by prosecuting
the office of the Chief Constable or by adding police forces to
the list in the schedule of bodies. The mechanism about how to
proceed is one that we have not come to a conclusion on and if
the committee has views about that we would very much welcome
them. There is also an issue of operational contact. How do we
hold the police to account? Our mechanisms for the accountability
of the police have developed over years. They are a tripartite
arrangement with the Home Secretary, the Police Authority and
the Chief Constable. We think those arrangements have operated
pretty well. We do not want to disturb those basic arrangements
for accountability. There are also, of course, issues about the
nature of police activities because they will frequently be involved
in seeking to minimise the risk to others by their actions.
Q575 Chairman: Minister, if I can
take you up on that, basically you have got two options, they
will be in the Bill and you have not resolved which way to do
it?
Fiona Mactaggart: That is correct.
Q576 Mr Rooney: It has been suggested
that it is not certain that case law on the chain of causation
has developed in the way the introduction to the draft Bill suggests,
and we have had witnesses saying that. If we accept that the argument
that case law has developed in this area are there any other reasons
why the Government believe the Law Commission's original provision
on causation should not be included?
Fiona Mactaggart: The Law Commission's
evidence to this committee seems to suggest that we are proceeding
in the appropriate way, and I think that to include a provision
along the lines that the Law Commission originally recommended
could risk this. Although their proposal makes clear that the
most immediate cause will not stop the management failure also
being the cause of death, it does not say when that chain of causation
will be broken. That is important because it might lead to courts
saying that the chain of causation is broken under different circumstances
than under the general rules, and that could risk the law approaching
differently the case of a senior manager causing death, for example,
under the gross negligence manslaughter offence that exists at
present, from the company causing death even if the failure was
one and the same in this case. It seems to me therefore that it
is necessary to have the way in which causation is understood
for an individual prosecution, which could run side by side with
a corporate prosecution, to operate in the same way and that is
what we are seeking to do in this Bill.
Q577 Mr Rooney: We all accept that
we have seen all too often individual prosecutions fail, do we
not? Never mind. We need to move on. Some respondents have argued
whether senior managers sought to "profit from failure"
is not something juries should be required to adjudicate on. Have
you had any further thoughts on this?
Fiona Mactaggart: Our intention
in putting this provision was not to use profit merely in the
sense of financial gain, but if it was to gain advantage. Our
aim was, for example, to get at the kind of behaviour that companies
might adopt in order to save money and get jobs done faster, for
example, so it was not trying to tie a specific profit to a particular
action. If the committee had a view that there was a way that
one could get at this point differently from how we framed it,
in my view this could be a matter which could perhaps more appropriately
be dealt with in terms of its impact on sentencing rather than
its impact on the criminal behaviour itself, and that is something
that we should perhaps consider in the light of your report.
Q578 Mr Rooney: A number of witnesses
from all sides of this argument have suggested that "benefit"
would be a better word than "profit".
Fiona Mactaggart: Absolutely.
I welcome such a suggestion.
Q579 Mr Rooney: The Law Commission
proposals contained no requirement that a duty of care be owed.
Why has the Government decided to link the offence to a duty of
care owed under the law of negligence?
Fiona Mactaggart: I think that
they assumed that the duty of care was implicit in their original
framing of the Bill. It seems to me that requiring a duty of care
defines clearly the circumstances in which the new offence might
apply and it is important to have this for an offence of a failure
to act. This is key because an offence of not doing something
could lead one to have a successful prosecution. That is not usual
in most offences that I can imagine. Because failure to act could
be as significant in a prosecution like this as action it is necessary
to make clear when companies are liable. The best way to do that
is to depend on the duty of care which is the kind of framework
of our basic legislative approach in these things. I am being
passed something so perhaps, Mr Smith, you could tell the committee
what it was you were trying to show me because I cannot read things
in that small print.
Mr Smith: The question whether
it was included in the Law Commission's original proposals or
not I think is interesting in the light of their written evidence
to the committee, which says, "We believe that this was implicit
in the Commission's Bill but we see value in making it explicit".
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