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John Hemming (Birmingham, Yardley) (LD): I experienced the same difficulty during pre-legislative scrutiny and in Committee in understanding how, if the Minister appoints and removes the legal services board chair, the body is independent of Government. The Under-Secretary essentially proposes a system whereby the Government are in control of the legal services board.

Bridget Prentice: If the hon. Gentleman looks back at our debate in Committee, he will read that I said—I repeat the point here—that it is odd that Liberal Democrats object to proper parliamentary scrutiny by, in this case, the Lord Chancellor, and of the appointment of the legal services board. The fact that it must be done under the rules of the Commissioner for Public Appointments makes it clear that the person has to be independent of Government and Ministers. I am determined that that should be the case.

John Hemming: As the Under-Secretary may know, I have had some involvement in the private sector, where shares are owned, directors can be appointed and so on. If one appoints directors to a body, it is deemed to be a subsidiary, not independent. It may have some legal independence as an entity, but it is a subsidiary and controlled in that way. Does the Under-Secretary not accept that there is some merit in separating the estates of the constitution so that the judiciary and its associated links are independent of the Government?

Bridget Prentice: We all accept that the judiciary, solicitors and barristers are independent of Government. If I may put it gently to the hon. Gentleman, he is perhaps living in the past. The Liberal Democrats, if not the hon. Gentleman, supported the Lord Chancellor having some oversight of appointments to the consumer panel, yet he suggests that there should not be oversight of the chair of the legal services board.

Although I have conceded that it is important for the Lord Chancellor to consult the Lord Chief Justice, some may feel that if the Lord Chief Justice’s view of the appointment were very different from that of the Lord Chancellor, it should not be suppressed. Let me make it absolutely clear that if in consultation the Lord Chief Justice took a view contrary to that of the Lord Chancellor, the Lord Chief Justice would be perfectly entitled, and able, to make his view public. I do not think for a moment that Ministers would be able to apply pressure to him—or her, if we ever have a female Lord Chief Justice.

Robert Neill: I welcome the last part of what the Minister said, but, with respect, I fail to understand the argument that because the Lord Chancellor—who is accountable to Parliament—must obtain someone else’s agreement to an appointment that he himself ultimately makes anyway, that somehow undermines his accountability. That does not strike me as logical. If consultation takes place, ultimately it is the Lord Chancellor’s decision; it is just that he has to get someone else to agree with it.

I am glad the Minister has said that if the Lord Chief Justice really thought there was to be an inappropriate appointment, he would have the right to go public. Will she consider entrenching the process by at some point
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giving the Lord Chief Justice the same right to make a statement to Parliament as he has in relation to other matters under the Constitutional Reform Act 2005?

Bridget Prentice: Let me deal with the second point first. Discussions about constitutional reform are not relevant to this Bill. Perhaps what the hon. Gentleman has said should be referred to those who are dealing with such issues; he may have an opportunity to raise them in another forum.

I am pretty sure that if I looked up “concurrence” in a dictionary, I would learn that it meant that if two people were involved, they would have to agree.

Mr. Heath: Both!

Robert Neill: It is still the Lord Chancellor’s decision.

Bridget Prentice: If both must agree, it is not concurrence when only one can make the decision. I am not sure what the right phrase is in this context, but while I am aware that lawyers like to dance on the heads of pins when it comes to definitions, I think that the hon. Gentleman needs to reflect on the meaning of “concurrence” and my reason for rejecting it in this instance. As I said in Committee, the decision should be made in consultation with the Lord Chief Justice, and no doubt with others—that will be in the Bill—and the Lord Chief Justice will be able to make his views known.

Members will recall that I wanted to re-examine the question of the lay chair following our robust debate in Committee about what should happen if for some reason the first chair—who, under the Bill as it stands, must be a lay chair—vacates office prematurely. The possibility was mooted that a lawyer might be able to become chair of the board earlier than had been intended. I therefore tabled amendments Nos. 103 and 104 to ensure that all chairs appointed in the first five years must be lay. Now my hon. Friends the Members for North Durham (Mr. Jones) and for Bassetlaw (John Mann) have tabled an amendment providing for the chair always to be lay, and for that reason I shall not pursue amendment No. 103. I think that the arguments my hon. Friends advanced in Committee—which I hope they will reinforce this evening—are excellent.

5.30 pm

Those arguments will give the consumer confidence that the regulatory system is designed to protect them, which is why we already require a majority of the board to be lay. That does not prevent people who have qualified as lawyers from sitting on the board; after all, they will be able to provide an essential insight into the profession. However, I have been persuaded by the arguments. I note that my hon. Friend the Member for North Durham tabled another amendment that has not been selected, but he will find that amendment No. 104 achieves the same end. For that reason, I hope that the Government amendments that I have set out will be accepted.

Mr. Jonathan Djanogly (Huntingdon) (Con): First, I declare an interest as member of the Law Society and of the corporate finance faculty of the Institute of Chartered Accountants.

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The group covers two distinct areas: first, the consumer panel, which will represent the interests of consumers of legal services—we are now almost in agreement with the Government’s position—and secondly, the legal services board, on which there are important outstanding issues. We appreciate the Government’ acceptance of our position regarding the need for appointments to the consumer panel to be made objectively and to be seen to be made objectively. Such a need is fulfilled by the Lord Chancellor’s approval of such appointments.

The Government’s concession on the issue, through amendment. No. 78, is on the same terms as those suggested by my hon. Friends and me in Committee, and thus removes the need for our amendment No. 6. This is a welcome development.

Government amendments Nos. 78 and 79 provide for members of the consumer panel to be appointed for a fixed period and on other terms and conditions as determined by the board. They also provide for the removal of a member of the consumer panel in accordance with those terms and conditions that would require the approval of the Lord Chancellor. Again we are pleased to see the Government’s movement, but I should like some minor clarification. The terms and conditions of appointment will be fixed and known to the Lord Chancellor before removal. Surely we only need to cater for the situation where a removal is carried out other than in accordance with what has been previously approved. If this is the intention, I suggest that the wording in clause 8 should be that a person may be removed from office otherwise than in accordance with those terms and conditions and only with the approval of the Lord Chancellor. In effect, I believe that these new provisions, while moving in the right direction, may require some further thought; perhaps the Minister might clarify the existing wording.

Our amendment No. 7 would mean that the chairman and other members of the consumer panel would not be appointed simply on terms and conditions determined by the board, but following public advertisement and selection by the pervading standards for selection of members of public bodies. This wording is to be added so that appointments to the consumer panel are made and seen to be made objectively. This will give all applicants a fair opportunity to apply for the panel. As a consumer panel, it needs to represent the public and therefore a public advertisement would be the best means of ensuring that that is the case.

Additionally, it is important that the current criterion for selecting members of a public body is employed so that all applicants are given and are seen to be given an equal opportunity to be selected. We see this as important, as the consumer panel is the voice of the public and ensures that consumers are given adequate representation. Also, it is necessary explicitly to set out in the Bill that the pervading standards for selection of members of public bodies must be followed. Given that the appointments are to be made by the board and not by Ministers, strictly speaking, there will be no compulsion to follow the Commissioner for Public Appointments’ code of practice. The hon. Member for Somerton and Frome (Mr. Heath) made a valid intervention on that issue. Our amendment follows that line of thought and would plug the gap.

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Our amendment No. 8 to clause 11 would ensure that the consumer panel has access to the information held by the board which it needs to carry out its functions, subject to appropriate restrictions. In the same way that a person needs the appropriate resources in order to do their work, the consumer panel will require access to certain information in order to carry out its work to the highest possible level.

However, amendment No. 8 also recognises that there might be some instances when it is inappropriate for the consumer panel to receive such information. Therefore, its proposed new subsection (5) gives the legal services board the discretion to decide whether that is the case. The Minister was previously unwilling to move on this issue, fearing, I believe, that it could lead to empire building by the consumer panel rather than consumer interests being represented, and we share that concern. However, she agreed that she would consider an amendment ensuring that the board provides the consumer panel with the necessary information for it to discharge its functions. This amendment does that; it would improve clause 11 as it would enable the consumer panel better to represent the consumers’ interests. The Minister has considered this issue again, and we are sorry that there has not been a little movement in that direction.

Amendment No. 75 was tabled by the hon. Member for North Durham (Mr. Jones), whose contribution to our deliberations on the Bill deserves recognition—even if it has not always won our agreement. It would result in the chairman of the legal services board always having to be a lay person. We remain unconvinced of the necessity for such an amendment. It is not sensible for lawyers to be unable to take on the chairmanship of the board and for the prohibition period to be extended indefinitely. Would people qualified as lawyers but who work in business and have not practised as a lawyer for a number of years be among those discriminated against? Such prejudice is unjust and nonsensical.

John Hemming: Does the hon. Gentleman not accept that there is an argument for the legal services board, and particularly its chair, to be seen to be independent of the legal profession?

Mr. Djanogly: That argument can certainly be made, but I am saying that it will not apply to all lawyers in all cases. It might apply to certain lawyers; in some circumstances, a lawyer’s practice might negate their suitability for the position. That will not, however, be the case in all instances. The problem with this proposal is that it would create a non-adaptable set of circumstances. That would not be suitable. We have recently had a Prime Minister who was a lawyer, and lawyers can be chairmen of various sorts of organisations, from banks to voluntary agencies. There is no justification for excluding an entire profession from the role of chairman of the legal services board. It is in the public interest that the best person for the job is appointed as chairman, and I see no reason why the best person might not be, for instance, a qualified non-practising lawyer. We shall therefore seek to divide the House on amendment No. 75 at the appropriate time, which will be when we debate a later group of amendments.

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Government amendment No. 103 would ensure that the chairman of the legal services board must be a lay person for the first five years. Again, we see no justification for that requirement and believe that the chairman should simply be the best person for the job. I note that the Government have withdrawn the amendment, so this point has in effect become irrelevant.

Government amendment No. 104 clarifies the fact that the chairman, and not simply “any subsequent” chairman, must not carry out reserved legal activities during the appointment. That simply follows on from other points.

Let me now turn to what in constitutional terms is the core of the proposed legislation: the appointment and removal of members of the legal services board. We appreciate the Minister accepting that her position in Committee—the simple reliance on Nolan principles to ensure that appointments to the board are made independently of Government—was insufficient. Appointments to the board being made by the Lord Chancellor alone could have had serious implications. It would have meant that a senior member of the Executive would have had the ultimate responsibility for governing how the legal profession was regulated. Such a structure could have dramatically undermined the crucial principle of the independence of the legal services board from Government.

I am glad that the Minister has changed the Government’s stance, adopted in Committee, of simply tabling amendments to wreck what we felt was the good work carried out in the other place, and that she has instead come back with the constructive suggestion, contained in Government amendments Nos. 102 and 106, that appointments and removals from the legal services board be made following consultation with the Lord Chief Justice.

I spoke at some length in Committee about the serious concerns of many groups about the potential effect on the legal profession’s independence if the Lord Chancellor could make appointments to the LSB alone. The Government appear finally to have listened to the views of the legal profession, the Law Society, the Bar Council, other regulators—both national and, I have to say, international—Conservatives, Liberal Democrats and Cross-Bench peers, who amended the Bill in the House of Lords to ensure that a check exists on the Lord Chancellor’s power to make appointments to the LSB. However, I still question whether the Government’s amendments go far enough to protect the legal profession’s independence. I still believe that ideally, the Lord Chief Justice’s concurrence would be the most appropriate check on the Lord Chancellor’s powers. It is for that reason that my hon. Friends and I tabled amendments Nos. 24 to 34.

The Law Society has expressed concerns about the position under the Government amendments, which provide only for “consultation” with the Lord Chief Justice. In a letter to Lord Kingsland of 10 September, the Law Society stated:

I very much hope that the Minister can provide such assurances to address the Law Society’s concerns, which we share. However, requiring appointments to be made with the Lord Chief Justice’s concurrence would ensure that his or her opinion was given sufficient sway, and that appointments were wholly independent of Government influence.

Indeed, we say that this requirement for concurrence is the best protection to bolster the independence of the legal profession from the Government. Simple consultation, with no clarification of what it will involve, does not go far enough on such an important issue. An independent legal profession provides the ultimate safeguard of the rights of the individual against abuse of power by the state. Lord Woolf, the former Lord Chief Justice, has wisely pointed out that

Simply requiring consultation with the Lord Chief Justice may, in some circumstances, not be sufficient to ensure that any doubt about the independence of the legal profession is removed.

In discussions with the Minister, which were certainly helpful, the question was raised of using a parliamentary confirmation hearing for appointments to the LSB, along the lines announced by the Prime Minister in relation to senior appointments. The Minister stated that she would look into the possibility of using such hearings, and I should be pleased to hear her views on that in relation to all board appointments, or just chairman appointments. I point out, however, that even if such hearings were put in place, they might not go far enough to protect the legal profession’s independence. The Lord Chancellor would not need to listen to any recommendations, and could be seen to be following unchecked some form of political agenda in relation to the appointment of the board. It does not matter how much consultation with the Lord Chief Justice or a parliamentary Committee takes place if it is simply ignored. For this reason, we still see the concurrence of the Lord Chief Justice as the ideal.

The position under the Government’s amendments is that simple “consultation” would suffice. This issue must be addressed again if consultation is ever to be sufficient. At the very least, written guidelines on what that consultation will involve must be provided. For instance, is it agreed that the Lord Chief Justice’s views on appointments to the legal services board should be publishable? We are not yet there on these vital provisions. The concurrence position was that agreed by all Opposition Members and passed in the other place. That is where it will go again, as would be the case in any event, because it is essentially the amendment from the other place that this House has turned down. The Government will have difficulties unless much more flesh is placed on the bones of their concession. On that basis, I shall ask for a Division at the appropriate time in these proceedings to allow hon. Members to vote for concurrence, on amendment No. 24.

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5.45 pm

Mr. Kevan Jones: I shall speak to amendment No. 75, which stands in my name and that of my hon. Friend the Member for Bassetlaw (John Mann). This simple amendment is of great importance to this Bill, because it reinforces what the Minister has said throughout its passage about putting the consumer at its heart.

The amendment proposes to remove the word “first” from paragraph 2(2) to schedule 1, which states:

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