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Mr. Richard Benyon (Newbury) (Con): It is a great pleasure to follow my hon. Friend the Member for Old Bexley and Sidcup (Derek Conway), who added a timely note of caution, with which I concur, to the debate. I also concur with his support for Citizens Advice and its work in our constituencies. My experience of serving more than a dozen years on the management board of my local citizens advice bureau, and closely following the organisations social policy recommendations locally and nationally since I have been a Member of Parliament, has informed me when considering the Bill. I agree with hon. Members of all parties that the Bill is important and will affect the lives of millions of people, especially the most vulnerable members of society.
The second experience that I bring to the debate is that of being an employer who has been the subject of a vexatious claim that ended in a tribunal. It happened some years ago but one holds such experiences in ones head and hopes that they can add a little to debates on important subjects. The experience gave me an insight into the tribunal system and showed me the way in which a vexatious claimant can use it on a nothing-to-lose basis. I am glad to say that the tribunal found in my favour.
As we have heard, a plethora of different tribunals has emerged in recent yearsmore than 70 at the last count. They hear 1 million cases a year at a cost of more than £250 million a year to the taxpayer in administrative costs. Growth in that part of the legal system has been unstructured and it is therefore right for hon. Members of all parties to welcome moves to create a single administrative system. The Governments record in unifying organisations across Government has not been universally happy, and we must therefore wait and see how the matter develops, but I broadly support the thrust of the Governments intentions.
Like my hon. Friend the Member for South Staffordshire (Sir Patrick Cormack), I pay special tribute to the work done at the other end of the Corridor. The Bill has been well debated, thought through and amended in a way that has improved it.
I am concerned that there should be a better means of weeding out vexatious claims before they reach a tribunal. Opportunities exist for individuals to pursue a vexatious claim, with nothing to lose. Even if the employer wins, as in the case that I mentioned, he has suffered enormous cost, not only financially but in time, and has often left the courtas I did after three days of a hearingasking why anybody employs anyone in this country. At times, that sense of despairamong small business men in particularwill be felt across the country.
Given that a rampant compensation culture has entered our society and the extent to which many legal rights have been extended in recent years, we must look seriouslythere may be such an opportunity in Committeeat following recommendations from organisations such as the CBI on weeding out vexatious claims before they get to tribunal. The CBI has suggested that some form of bond or deposit arrangement could be used. Therefore, if it was felt
during pre-hearing scrutiny that a claim could be vexatious, the decision could be left to the tribunal, adjudicator or whoever and they could demand that a bond or a deposit be left with the tribunal, which would fall if the tribunal decided that the claim was indeed vexatious.
It is worth noting that many of Sir Andrew Leggatts proposals would not require legislation. As a member of the Home Affairs Committee, last year I spent a lot of time looking into asylum and immigration tribunals, but since then responsibility for those tribunals has fallen to the Department for Constitutional Affairs. I thought that there was, at the very least, a conflict of interestperhaps a perverse anomalywhereby the Department whose decisions were being questioned was responsible for the tribunals themselves.
I came to the debate concerned about how much of the detail of the new tribunal system has been left out of the Bill, and I wanted to echo the concerns of the citizens advice bureaux on that, but I have been encouraged by the Ministers response to my hon. Friend the Member for Bournemouth, East (Mr. Ellwood), which seemed to suggest Government willingness to look at the matter in Committee and report back to the House.
I pay particular tribute to an important amendment, achieved in the other place by Lord Goodlad, on introducing much more mediation to the tribunals process. I am glad that it was accepted in all parts of the House.
I want briefly to discuss the enforcement of judgments and orderspart of the Bill that has attracted the attention of a lot of Members this afternoon. It is a shame that the intentions of the White Paper have not found their way into the Bill. I was very affected by details of the Citizens Advice survey of bureaux around the country, which received almost 500 submissions from 131 bureaux. I shall not list them all, but it is worth pointing it out that 40 per cent. report that bailiffs are misrepresenting their powers of entry; 64 per cent. report that bailiffs are harassing or intimidating the client; a staggering 79 per cent. report problems negotiating with bailiffs; and 56 per cent. report that the client was vulnerable when those negotiations occurred. That shows that there is a serious problem with the process.
My hon. Friend the Member for Old Bexley and Sidcup (Derek Conway) used the time honoured phrase, An Englishmans home is his castle, but it is worth noting that an awful lot of other bodies and organisations can enter a persons home. That is true not only of the emergency services, of course, but of utilities and several local authority departments such as planning and council tax, and even of pest and vermin control officers. It is becoming increasingly difficult to address the direct importance of the concept of who is allowed into a persons house and in what circumstances such an entry can be made.
Unfortunately, the government has dropped from the draft Bill any plans to regulate the activities of bailiffs even though the legislation, if enacted, will give them added powers. We think this is unacceptable, given the outrageous practices by some bailiff firms reported in the evidence sent in by bureaux.
I accept that there may be movement on that, and I am delighted by it, but I hope that the assurance given to my hon. Friends that there could be some time link to allow the consultation process and the new regulations to form part of the Bill will achieve an excellent outcome. I commend the Government for moving on that.
I am not one who tends to call for greater regulation, but I believe that it is necessary in this area of enforcement. If the Credit Services Association, citizens advice bureaux and the civil enforcement agencies all agree on this, it is time to take note.
In west Berkshire, our experience with bailiffs is interesting and the magistrates courts bailiffs seem to be a law unto themselves. The citizens advice bureaux can find no means of negotiating or of trying to make them take a wider view than the precise circumstances of the order that they are seeking to enforce, whereas the bailiffs contracted to the council are a completely different animal altogether. They seem to be able to work with organisations such as the money advice service to ensure that a wider view is taken of the debts of a vulnerable individual. I am delighted that the Bill will incorporate a degree of control over all the different types of bailiff in that respect.
There is one other important item. We need in the Bill a list of exempt goods. In another place, it was said that it is too complicated to list those exempt items because this is a constantly changing world and making such a list is too difficult. I am not asking for great detail, but it should be accepted that bailiffs should not seize the means for an individual to continue his employment. For example, the tools of a carpenter or a plumber should not be taken. Also, there should be a wider application so that control of goods may be takenfor example, if a taxi driver has fallen into debt, his taxi clearly should not be seized in respect of those debts, but we might be able to prevent him from selling the taxi until the debts have been settled and an agreement made with an organisation such as the citizens advice bureau.
Those moves must be made hand in glove with a serious attempt to educate people about debt. I am staggered by the financial illiteracy in the world, and I am staggered by the economic illiteracy that sometimes exists in this place, but the Government should have a cross-Government objective in this area. My party attempted on its website, through the introduction of a certain character whose name is probably unparliamentary, to address and educate people. That was a faintly risible but honest and straightforward attempt to inform people of the problems of getting into debt.
The Daily Mail needs congratulating on the debt service that it runs through its website and the many articles that it writes on the subject of debt. The ease of getting a loan is everywhere to be seen and the Sunday papers offer endless opportunities to take out reverse mortgages to resolve debtget rid of debt in one fell swoop and all peoples problems will go away.
Mr. Newmark: Does my hon. Friend agree that the real problem lies not just in advertisements for loans in respectable newspapers such as the Daily Mail, but in the fly sheets that go through letter boxes on the estates, offering loans but at interest rates in excess of 100 or 200 per cent?
In yesterdays edition of the News of the World, one advertisement had the headline, Repossessions stopped. Be free of debt. Pay off your mortgage. It is as if all ones debts can suddenly go away overnight; of course, they cannot. A real attempt should be made to educate people, not only at school but through adult debt advice services. By the time that people come into our surgeries or use the money advice service provided by citizens advice bureaux, it is too late; it is vital to get to them much earlier.
The savings index has never been so low, and consumer credit has never been so high. For some, credit is simply too readily available. Anyone can go into a store and get a £500 store card on demand, whatever debt they face. Many mobile phone contract arrangements are equally damaging to vulnerable people who are already in debt. The cost of the bailiff and enforcement service to which the Bill refers would be dramatically reduced if we addressed the cultural problem at the heart of our society at its source.
James Brokenshire (Hornchurch) (Con): It is a pleasure to follow my hon. Friend the Member for Newbury (Mr. Benyon). I echo his comments in relation to current levels of personal debt of about £1.3 trillionsome estimate the figure to be higherand the impact on individuals. His comments about the need for restrictions on the way in which loans are offered to individuals echo some of the debates on the Consumer Credit Bill 12 months ago in relation to promoting responsible lending. As shown by the reports that constituency advice surgeries continue to receive about ordinary people getting into serious problems as a consequence of debt, we need to maintain our focus on this area. Before I address part 4 of the Bill, on enforcement, I should declare my entry in the Register of Members Interests as a non-practising solicitor.
If we are to have a system of law that is seen to be just and to address disputes effectively, that must be reflected at all stages: in access to justice; in the manner in which individual claims are dealt with in court; and, thereafter, in obtaining redress once a court or tribunal has reached its determination. In the previous Session, I was a member of the Select Committee on Constitutional Affairs, which conducted an evidence session and, subsequently, issued a formal report on all aspects of the small claims court. In his evidence to the Committee, Professor John Baldwin, head of the school of law at the university of Birmingham, focused on the issue of enforcement, and the fact that it is possible to go all the way through the process and end up with virtually nothing to show for it. He said:
In my view, ineffective enforcement procedures undermine the credibility and integrity of the civil courtsand the credibility and integrity of small claimsmore than any other factor. When enforcement mechanisms fail, claimants feel let down, if not cheated. Access to justice requires more than the provision of fair, expeditious and inexpensive procedures to resolve legal disputes; for judicial procedures to have meaning, the courts must in addition provide effective mechanisms by which litigants can enforce the judgment.
The Association recognises that enforcement of judgments has been highly unsatisfactory for many years. We understand that, statistically, only one third of judgments are paid in full. Some payment is made in half the remaining cases, but in one third of cases no payment is made at all. We suspect that, since insurance companies or other commercial litigants will meet their obligations in full, the great majority of litigants whose judgments are unsatisfied are private individuals. This is a deplorable state of affairs.
Given the measures introduced in the Bill, I recognise that the Government have taken that on board. It is hardly surprising that the Select Committee, in advocating certain key recommendations, said that reform needed to be undertaken expeditiously and that the process needed to be monitored and kept closely under review.
In part, the Bill makes important changes to the enforcement of judgments, and perhaps brings greater certainty to the process for individuals who seek to resolve disputes and enforce claims through the courts system. The attachment of earnings in the provision of information on employers is a welcome measure to assist in tracking people down and ensuring that court judgments are enforced. The provision of fixed rates of deduction might also provide greater certainty. Clauses 90 and 96 also introduce information orders and departmental information requests. I was interested to read in clause 96(3) that the
relevant court may use the debtor information for the purpose of providing the creditor with information about what kind of action (if any) it would be appropriate to take in court (whether the relevant court or another court) to recover the judgment debt.
The issue of information is important. I have been contacted in my constituency advice surgery by people who have been frustrated at not being able to identify the address, or other related information, of the creditor against whom they are seeking to enforce. The clause makes an interesting suggestion as to the involvement of the court and what might be an appropriate remedy for the person who has obtained a judgment in their favour. It will be interesting to hear in the wind-up or in Committee whether the process is intended to be more dynamic in assisting people in recovering their judgment debt. Certainly, information, support and guidance for individual claimants would be beneficial, especially in the context of the small claims track of the county court.
During my involvement in the Select Committee investigation, I had the opportunity to spend some time in the small claims court. That was informative and instrumental in showing that people require quite a lot of assistance in making their case, providing the correct documentation to establish a claim, and presenting their case in a manner that demonstrates that they have good grounds for seeking recompense. It is understandable that people seeking justice may feel that, having gone through a lengthy process, they are being denied the opportunity to see judgments being enforced and justice being done. We must be clear
about what is achievable. I hope the Minister will assure us that enforcement assistance will not be represented merely by words in statute, and that a much more constructive process will be introduced to give individual claimants advice, information and support.
The Department has focused on helping such claimants through the small claims procedure. People would be let down if access to information and support were shut off following a judgment, and would feel frustrated at the fact that justice had not been done. Members, including the Minister, have said that lawyers should not be involved when that is not necessary. People would certainly be let down if they had to have recourse to legal advice to enforce a judgment that they had obtained through their own merits, and to secure payment. While I welcome the Governments proposals to add to existing enforcement mechanisms, I hope that they will be examined closely in Committee, and that the Government will be pressed on the subject of the information and support that will accompany the strict legal measures in the Bill.
In their provisions on distraint for recovery of rent the Government have followed recommendations, and have acted on the basis that the existing law is to be abolished and a distinction is to be drawn between the recovery of rent in commercial circumstances and its recovery in residential circumstances. They have addressed concerns that the existing law is unfair and disproportionate, and might unnecessarily penalise non-commercial tenants with rent arrears. However, as many Members have pointed out, they have chosen to extend bailiffs rights to force entry to property and seize assets without providing, at this stage, the full protection of a regulatory system.
I took on board what the Minister said about the certification process providing some reassurance, but that is obviously not the end result. It has been accepted that in many respects the current arrangement is a halfway house. It is rather unfortunate that the Select Committee had to consider half the issue the codification of the law on bailiffs rights, and the extension of certain aspects of that lawwithout also being able to consider, fully and properly, the question of regulation. The Government are consulting on it now; the consultation is due to conclude at the end of April, and the Minister assured us today of the intention to present regulations and orders to Parliament before the summer recess. I hope that the Minister and the Government will take account of our wish for a mechanism to prevent a mismatch, and for an opportunity to consider the issue in its entirety.
Arguments that we have heard today have persuaded me that we should delay the implementation of provisions to extend bailiffs powers until there is clarity and certainty about the regulatory aspects of their work. If what we have been told today is truethat once orders have been laid before Parliament, they will be followed by regulations and then by trainingit is to be hoped that the two sides of the issue can be married within a manageable time framework.
Members have mentioned representations made by citizens advice bureaux. My hon. Friend the Member for Newbury told us that about 39.5 per cent. of them
had reported problems with bailiffs misrepresenting their powers of entry. As I told the Minister, I fear that any new laws may cause further confusion by suggesting that bailiffs have new powers when they have no such powers, thus increasing the risk of misrepresentation. The problem of misrepresentation is important, and underlines the need for regulation to provide more protection for individuals against the small proportion of bailiffs who are abusing their powers and bringing their whole area of practice into disrepute.
I pay tribute to the work of Havering citizens advice bureau, which wrote to me about a case in which car wheels were chained by a firm of bailiffs that then tried to charge £554 for the release of the vehicle, although an offer had been made to pay the relevant parking fine and £200 for the release. Eventually the police were called, and warned the bailiffs about obstructing the highway and causing a breach of the peace. That is typical of the problems that our constituents face every day when bailiffs wish to extend their powers further than they should, and to abuse their position.
I appreciate that the Bill is an interim measure. The Government have made it clear that they want to introduce a system of regulation that will, in all likelihood, involve the Security Industry Authority. While it is to be hoped that appropriate regulations and orders will be presented before the summer recess, I for one feel somewhat uncomfortable about a potential extension of bailiffs rights and powers without the establishment of such protective measures.
It is unfortunate that we cannot deal with the whole issue in a seamless way. Given the concern about certain rogue operators, I hope that the Government will consider introducing further protections. If that is not practicable, I hope that they will assure us that there will be no extension of powers until a proper regulatory regime has been put into effect.
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