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facilitate the exercise of the function.
Consequently, the regime in part 9 did not deal effectively with protecting confidential information in such cases. Subsections (5) and (6) were therefore inserted in clause 29 to provide protection. They require the council to consult the individual or business to which the information relates and to have regard to the principles in section 244 of the 2002 Act, which apply to disclosure under part 9. Those are: the public interest, the necessity for disclosure, and the need to exclude from disclosure information which might significantly harm the individual or business to which it relates.
Those provisions draw on the existing models in the gas, electricity and postal services sectors. For example, section 19 of the Utilities Act 2000 applies to publication of information by Energywatch In each case, the general disclosure regime in the legislation is disapplied and special provision is made for the function of publication.
So, to give protection to business and personal information, we have included subsections (5) and (6) in clause 29, and made it clear in clause 29(4) that the prohibition on disclosure in part 9 of the Enterprise Act 2002 does not apply. The result is proper safeguards, including consultation with individuals or businesses to which the information relates, before disclosure can be made in exercising the councils functions under which information may be published.
I hope that that information will assist the hon. Member for Cotswold. I recognise that it was rather a technical explanation, and I apologise for that, but I can give him an assurance that the end result will be a set of provisions that broadly follow the existing arrangements while ensuring that there is a single disclosure regime for the new council instead of multiple regimes. I hope that, given that reassurance, he will feel able to withdraw his amendment, although I recognise the validity of the concerns that he has raised.
Mr. Clifton-Brown: I thank the Minister for giving way. This is a technical matter, as he says, and the official Opposition do not dispute the need for one disclosure regime for the various bodies brought together in the Bill. That is entirely understandable. What is not understandable, however, is why the careful balance established in section 244 of the Enterprise Act 2002, relating to disclosure by public bodies, has been moved in this way. There is an important balance to be struck in regard to what information is disclosed by public bodies that obtain sensitive information. We want to question carefully why that balancewhich has been altered by the Bill to make it easier for the public bodies covered by the Bill to disclose that informationhas been disturbed.
Mr. Timms: It is for technical reasons. Part 9 of the Enterprise Act cannot merely be applied here. Part 9 works when information is provided by a body in pursuit of its functions, but legally that does not work when the body in questionin this case, the new councilhas a specific function to provide information. That is the rather technical distinction. That is why there are separate provisions in clause 29(5) and (6), which provide safeguards in the specific circumstances, and in the context, of the new councils functions. I believe that those safeguards will be effective, and that they will deal with the hon. Gentlemans concerns.
Mr. Clifton-Brown: I am not entirely satisfied with the Ministers explanation, but this is a highly technical matter. Perhaps we need to leave it for now, rather than pressing the matter to a Division, but with the reservation that we might well want to revisit it on another occasion, perhaps in the course of a wider debate relating to the disclosure of information by public bodies.
The amendment has been tabled in my name and that of my hon. Friend the Member for Richmond Park (Susan Kramer). We have bundled two issues into this amendment: the application of the regulations to small enterprises, and the principle of best practice in the handling of complaints. Paragraph (a) is relevant to small businesses. Although it is clear that the general definition of consumer in clause 3 includes businessesor non-domestic consumers, which could include small voluntary groups, and so onthere is still a gap in clause 43. Subsections (2) and (3) say that complaint-handling standards can be restricted so that they do not cover all relevant customers. In other words, Ofgem, or whoever, could say that these regulations apply only to natural persons. The amendment seeks to require their interests to be considered without reopening the wider business/consumer debate.
The Minister might say that this argument is irrelevant because clause 44 includes requirements to consult, but that is not quite right. The requirement to consult applies only to those likely to be affected by the new regulations. If the complaint-handling standards apply only to private individuals, one would have to consult people representing those consumersthe energy supply companies and so onbut one would not necessarily have to consult small businesses, because they would arguably not be affected by the regulations.
The standard defence at this point is that businesses do not necessarily need protection as consumers. Indeed, consumers often need protecting from businesses. However, that argument is flawed. Why should a village shop or a charity have to be an expert in all the services that they consume? Ed Wilson of Energywatch makes the point that redress is available for small businesses and other non-domestic consumers in telecoms but not in energy. The Bill provides an opportunity to improve the situation for those consumers.
On a related point that goes a little beyond the amendments scope, it seems from clause 49(3)(b) that business or other non-domestic consumers will have access to redress schemes. Lord Truscott confirmed that in the Grand Committee in the Lords on 9 January. He also said that business suppliers will not have to join redress schemes. I would be grateful if the Minister clarified that and the suggestion that the new Department for Business, Enterprise and Regulatory Reform is minded to include businesses with 10 employees or fewer within the redress provisions. Approximately 96 per cent. of small businesses would be covered by that and it would be a welcome step. It does not appear to require any change to the text. Is it the Governments intention to include other non-domestic consumers such as those that I outlined?
On complaint-handling standards, the other part of the amendment would ensure that the regulations were governed by principles of best practice, the language used in clause 49 for redress schemes. That matters because clause 49(1) was toughened up to say that the regulator must have regard to those, in the face of objections from Ofgem. It therefore matters that the regulations are as good and effective as they can possibly be; otherwise we might end up with weak standards. We would argue that it is even more
important to get best practice standards for complaint handling than it is for redress schemes as we are relying on the energy companies to fill the gap left by the abolition of Energywatch and so on.
Part of the reason for the difference is the series of concessions from the Government during the course of proceedings on the Bill. Those were very welcome. The language on redress schemes in clause 49 was upgraded from good to best practice in the Grand Committee in the Lords, and in Committee in the Commons the Government upgraded the requirements for the regulator to prescribe standards for complaint handling from a may to a must. In a speech that the then Minister for Trade, the right hon. Member for Makerfield (Mr. McCartney), made to the National Consumer Council on 21 May, he said that he would
not settle until we have a consumer regime which is the bestnot just amongst the best.
Mr. Timms: I listened to the hon. Ladys case with interest, but the procedures that a regulator needs to follow in making regulations prescribing the standards to be met for complaint handling by regulated service providers, as set out in clause 44, are sufficiently robust. There is a requirement on a regulator to consult widely by conducting research to obtain and then take into consideration the views of a representative sample of persons likely to be affected by the regulations, and publicising the proposals in full detail to bring them to the attention of those likely to be affected, which is to a rather wider audience. In addition, the Bill provides that the regulations to be made are to be subject to the consent of the Secretary of State. Those requirements will mean that full and proper consideration will be given to proposed standards before a final decision is made by a regulator. The consultation requirement in the clause will enable all interested parties to contribute their ideas and advice on the complaint-handling standards which should be adopted, including any views on where best practice lies. It will be an open process, rather than the more restricted one about which the hon. Lady, understandably, expressed concern.
The prescribed standards will relate to the handling of complaints that are made to the regulated service providers by consumers of their services. The Bill sets out in clause 42(1) the regulated gas, electricity and postal services providers that will be subject to the new complaint-handling standards.
As for which users and customers will be covered by the standards, that is at the discretion of the regulator and can include small businesses if the regulator determines that it is appropriate that they should come within the scope. On the question of the criteria for approval of redress schemes as opposed to complaint-handling schemes, the processes are quite different. For redress schemes, it is the regulated service providers that can establish schemes and seek the approval of the regulator. Key criteria for approval are set out in clause 49, where the regulator is obliged to have regard to generally accepted principles of best practice.
The regulator is not obliged to consult on the approval criteria for the redress schemes, but is so obliged for the schemes on complaint handling. For complaint handling, it is the regulator who takes the initiative. Clause 44 obliges the regulator to consult, so there are different processes. That is the reason for the different approach that we have taken.
Lorely Burt: I am grateful to the Minister for his comments. I am somewhat reassured, particularly following his comments on the process of consultation and on the coverage in respect of small businesses. In the light of that, I beg to ask leave to withdraw the amendment.
Mr. Timms: These amendments relate to clauses 44 and 47, and the new redress and complaint-handling provisions to be introduced in the energy and postal services sectors, and potentially in the water sector after consultation in 2008. Those elements of the new framework for consumer representation and redress are important to the new arrangements in the Bill. A direct consequence of those new provisions is that regulated providers in the energy and postal services sectors, and potentially water, will be required to take full and proper responsibility for handling complaints from consumers of their services.
As an incentive for industry to take complaint-handling seriouslywe have just had a short debate about the importance of those processesthe Bill places a requirement on the regulators to make regulations prescribing standards for complaint handling which will be binding on regulated providers in those sectors. Where a regulated service provider has not been able to resolve a complaint to the satisfaction of the consumer, the availability of redress schemes will ensure that consumers will benefit from the certainty of resolution of a complaint, and the award of compensation where appropriate.
We are working closely with representatives of the key organisations concerned to ensure that we achieve a smooth transition to the new framework which maximises benefits to consumers, and minimises the uncertainty for staff in the existing organisations. We
expect that the new sectoral redress schemes will be established by industry and approved by the relevant regulators. In parallel, regulators will also be considering how to introduce the new standards for complaint handling.
We are discussing with industry and industry representatives how to make the transition to the new arrangements. The timetable for delivering the different aspects of the new framework will be challenging, and work on the detailed aspects of that must start immediately.
The intention behind the amendments is straightforward: to clarify the status of actions such as consultations and other procedural steps and to provide that where they are carried out before Royal Assent and commencement they nevertheless satisfy the requirements of the Bill as set out in clauses 44(1) and 47(4). There are time constraints, and the amendments will help us to make progress before Royal Assent and commencement, and provide an assurance that such actions will satisfy the obligations contained in the Bill. They will save time later in the process, and enable us to introduce measures swiftly.
Mr. Clifton-Brown: As the Minister said, this is a new amendment that addresses clause 44, which was also amended in Committee. The clause requires that all energy and postal suppliers operate an approved complaint-handling scheme. Subsection (1) places a number of requirements on regulators, such as those to undertake appropriate research and to consult
a representative sample of persons likely to be affected.
We support the requirement to ensure that effective complaint-handling procedures are in place and recognise that there is a need to consult. However, it is surprising that the Government have only now realised that such an amendment is necessary. The Governments intention of introducing the new arrangements within a year of the Bill receiving Royal Assent might be too ambitiousthe Minister said in moving the amendment that the time scale is challenging. Can he reassure us further that the Government will be able to address matters in time for Royal Assent, which I assume will be in a years time?
Government amendment No. 3 is also a new amendment. It relates to clause 47 provisions on the membership of the redress scheme. The clause ensures that all suppliers are members of an approved redress scheme. The redress scheme provisions in subsection (4) place an obligation on the Secretary of State to consult before making an order to require that regulated providers in the energy and postal service sectors belong to a redress scheme.
We support the requirement to ensure that all providers are members of an approved redress scheme and recognise that there is a need to consult. However, we are again surprised that the Government have only now realised that it is necessary to introduce such an amendment. I appreciate that the Minister, like me, was not present during earlier proceedings, but there is a
lack of joined-up government and forward thinking. I press the Minister to say whether the timetable to achieve the provisions contained in the two amendments is achievable.
Mr. Timms: The amendments are an example of forward thinking, rather than of the absence of forward thinking. Where it is our intention to introduce the new arrangements within a year of the Bill receiving Royal Assent, we want to maximise the benefits to consumers and minimise uncertainty for staff in the existing organisations. Both of those considerations suggest that it is right to meet the challenging timetable that we have set, and I think that we can do that.
Because of the time constraints on the implementation timetable, it would be helpful for us and the regulators to be able to consult before Royal Assent. That is why we have tabled these amendments. To do so is a prudent step. We do not want to jeopardise the achievement of this challenging timetable. The hon. Gentleman will agree that, from the point of view of consumers but also of staff, it is helpful not to waste time on this issue. The amendments will help us to resolve it quickly, and I hope that he feels able to support them on that basis.
Having come to the Bill rather late in its lifelike the hon. Member for Cotswold (Mr. Clifton-Brown), but unlike the hon. Member for Richmond Park (Susan Kramer)I am particularly grateful to my right hon. Friend the Member for Makerfield (Mr. McCartney), and my parliamentary neighbour, my hon. Friend the Member for Poplar and Canning Town (Jim Fitzpatrick), for their skilful and assiduous handling of the Bill on Second Reading and in Committee. Let me also thank all those other Membersincluding my right hon. Friend the Member for Coatbridge, Chryston and Bellshill (Mr. Clarke), who is in his placewho served on the Public Bill Committee.
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