 House of Commons |
Session 2006 - 07 Publications on the internet General Committee Debates Legal Services |
Legal Services Bill [Lords] |
The Committee consisted of the following Members:Hannah
Weston, John Benger, Committee
Clerks
†
attended the Committee
Public Bill CommitteeThursday 14 June 2007(Morning)[Frank Cook in the Chair]Legal Services Bill [Lords]9.7
am
The
Chairman:
May I first offer abject but sincere
apologies? For some reason, I was under the
impression that we were to commence our business of the day at 9.25 am,
which is the more usual time of commencement of our
sittings.
Clause 4Standards
of regulation, education and
training
Mr.
Jonathan Djanogly (Huntingdon) (Con): I beg to move
amendment No. 267, in clause 4, page 2, line 36, at beginning insert
‘(1)’.
The
Chairman:
With this it will be convenient to discuss the
following amendments: No. 216, in clause 4, page 2, line 36, leave out
‘assist in the maintenance and development’ and insert
‘ensure the development and
maintenance’.
No.
215, in
clause 4, page 3, line 1, at
end insert—
‘( ) In relation
to subsection (1)(b), the Board must satisfy itself that appropriate
standards of education and training, including training in client care,
are being maintained by approved regulators and, should it not be so
satisfied in respect of any particular education and training scheme or
schemes, the Board must consider withdrawal of its approval of that
scheme or those
schemes.’.
Mr.
Djanogly:
Good morning, Mr. Cook. Amendment No.
267 is not the most hard-hitting of amendments. It is consequential, so
I shall overlook it and move on to amendment No.
215.
Clause 4 imposes
a duty on the Legal Services Board to assist in the
maintenance and development of standards of regulation by approved
regulators of regulated persons, and in the education and training of
those persons. For example, it may issue guidance on or disseminate
examples of good education and training practices or principles of
professional conduct that have been developed for reserved legal
activity by one approved regulator to all approved
regulators.
Amendment
No. 215 has been tabled on a probing basis. It stresses the importance
of the board’s role in education and training. As the
overarching regulatory body that oversees the work of all other
regulatory bodies, the board must understand the importance of its role
as a supervisor and ensure that all regulators meet the necessary
standards. Accordingly, it is
important that it is instructed to withdraw its approval of any
education or training schemes that do not satisfy the relevant
criteria.
The approval
of the LSB as given to regulatory bodies should be regarded as an
endorsement oftheir suitability and mean that consumers will
have confidence in them. Therefore, it could be seen as necessary that
such approval is given only when it is deserved, not in the case of
regulatory bodies that fall short of the necessary
standards.
John
Mann (Bassetlaw) (Lab): I welcome the thrust of amendment
No. 216. It is such a good amendment that I was almost tempted to add
my name to it. The
words
“assist in the
maintenance and development of
standards”
seem
to be rather weak. The Minister should contemplate using the word
“ensure” because it gives a more appropriate and clearer
direction to the board and also sends out a message about the role of
the board to the professions. The amendment is worthy of the
Minister’s thoughtful consideration over the next day or
two.
The
Parliamentary Under-Secretary of State for Justice (Bridget
Prentice):
Obviously, I agree that it is part of the
board’s remit to work with approved regulators to achieve high
standards across the legal sector. That was the view of the Joint
Committee on the Draft Legal Services Bill and we accepted its
recommendation. The Bill explicitly states that intention in clause 4.
However, I have a different view on the nature of that duty. Clause 4
states:
“The
Board must assist in the maintenance and development of
standards”
in relation
to the regulation and the education and training of people authorised
by the regulators. I think that that gives the approved regulator the
necessary freedom to tailor its standards and training
regimesin a way that is appropriate to its own area of legal
expertise.
Although I
heard what my hon. Friend had to say, I think that it is appropriate to
use the word “assist” because it is about proportionate
regulation. We have discussed proportionality during the proceedings of
the Bill. The same must apply in this area. If we said that the board
had a duty to “ensure” the development and maintenance of
those standards, it would become a more interventionist approach. I am
not surethat that sits comfortably with effective oversight
regulation. Therefore, I hope that the hon. Member for Huntingdon will
withdraw the amendment in the knowledge that we are attempting to agree
that education and training standards are important, but that
assistance is the right way forward for the board’s role in
relation to the approved
regulator.
Mr.
Djanogly:
I take the Minister’s point about the
need for proportionate intervention. However, there is a subtle
difference here. If the legal services are not performed in accordance
with the provisions of the Bill, the Legal Services Board need not act
because the regulatory bodies will deal with the matter. If there
isa problem in respect of development and training schemes
with the regulatory bodies themselves, the Legal Services Board should
act in their place because
there is no supervisory body above it. Therefore, it could be said that
it is the responsibility and obligation of the Legal Services Board.
The board should not just assist in the maintenance and development of
the education and training schemes, but at some point be able to take
control. There may be a case for turning the amendment on its head, so
that if the board is not satisfied it should consider withdrawing its
approval for
schemes.
Bridget
Prentice:
The hon. Gentleman makes an
important point. If the board felt that the
arrangements had an adverse impact on the regulatory objectives, it
could intervene and have them changed. The Bill as it presently stands
responds to the very important point that he is
making.
Mr.
Djanogly:
I hear the Minister on that point of
clarification. I will go away and look at it. I thank her for saying
that. On that basis, I beg to ask leave to withdraw the
amendment.
Amendment, by leave,
withdrawn.
Clause
4
ordered to stand part of the Bill.
Clauses 5 to 7 ordered to
stand part of the
Bill.
Clause 8The
Consumer
Panel
9.15
am
‘( ) The
approval of the Lord Chancellor is required for the appointment of a
person to be the chairman or to be another member of the
Panel.’.
We
now move on to the consumer panel, whichwas debated at some
length in the other place. On reflection, we think that several items
need to be considered again or in a slightly different way. The
amendment was proposed to us by the Law Society, and we tabled it as a
probing amendment. It would make the Lord Chancellor responsible for
approving appointments to the consumer panel, to safeguardthe
panel’s independence. We need to ensure that appointments to the
consumer panel are made andare seen to be made objectively.
That is why we need someone—the amendment
suggests the Lord Chancellor —to oversee the appointments
process.
John
Hemming (Birmingham, Yardley) (LD): The amendment has been
tabled under our names, too. The process is similar to the way in which
Ofcom operates, and we are going back to that usual word
“independence” and the idea of what is independent of
what. The amendment would give the consumer panel some independence of
the body that it challenged, in theory. Unusually, we see additional
powers in the amendment for the Government.
Bridget
Prentice:
I was a little concerned when the hon. Member
for Huntingdon said that this was a probing amendment, because I want
to be very positive about it. I accept his arguments and those of the
consumer groups. Although I cannot say that I will
accept the amendment, I shall take it away and consider it, and I hope
to be able to say something more positive about it in the future. I can
see the logic of what both hon. Gentlemen have
said.
Simon
Hughes (North Southwark and Bermondsey) (LD): I just love
the gradualist way that Ministers give in—they never do so at
stage one, for fear that something is wrong, but only after a little
careful consideration. It is welcome, none the
less.
Bridget
Prentice:
Just to clarify for some membersof the
Committee, there is collective responsibility in Government and we have
to ensure that we bring everyone with us in the course of such
matters.
Mr.
Djanogly:
I shall do my best, Mr. Cook. We are
happy with the Minister’s response, accept that shewill
come back with a suitable amendment and look forward to seeing it. I
beg to ask leave to withdraw the amendment.
Amendment, by leave,
withdrawn.
‘(c) corporate
users of such
services.’.
The
Chairman:
With this it will be convenient to
discuss the following amendments: No. 219, in clause
8, page 4, line 3, at end insert ‘,
and
(c) qualified but non-practising
solicitors who, in their professional capacity, use or purchase
services provided by persons who are authorised persons in relation to
activities which are reserved legal
activities.’.
No.
209, in
clause 8, page 4, line 11, after
‘(d)’ insert
‘save in respect of a
person appointed to represent corporate users of reserved legal
activities.’.
No.
220, in
clause 8, page 4, line 12, at
end insert
‘, except for
those authorised persons referred to under subsection
4(c).’.
Mr.
Djanogly:
Amendments Nos. 209 and 220 are complementary to
amendments Nos. 208 and 219. Clause 8 will require the Legal Services
Board to set up and maintain a consumer panel—a panel of persons
whose task will be to represent consumers’ interests, as defined
by clause 208. Appointments to the panel will be made by the Legal
Services Board and one of the members of the panel will be appointed
its chairman by the board.
Clause 8 sets out the
categories of person who may not sit on the panel. Subsection (4) will
require the board to ensure that the membership of the consumer panel
gives a fair degree of representation
to:
“those who are using
(or are or may be contemplating using), in connection with businesses
carried on by them, services provided by persons who are authorised
persons in relation to activities which are reserved legal activities,
and...those who are using (or are or may be contemplating using)
such services otherwise than in connection with businesses carried on
by them.”
However, we
believe that it is also necessary that the consumer panel should
include representatives of the corporate users of legal services and
qualified but non-practising solicitors who use or purchase services in
their professional capacity, as well as individual and small business
representatives. To enable that, it is necessary to remove the
prohibition on authorised persons serving as members of the consumer
panel, as far as any representative of corporate users of legal
services is concerned.
One of the great purposes of
the Bill is to increase consumer protection, so the Minister needs to
explain why certain consumers are to be disadvantaged and not given the
same protection as others. We thought that the idea of the consumer
panel was that it should represent all, not just some, consumers of
legal services. The Government agreed on the need to ensure that a
range of voices should be heard on the consumer panel.
Only by ensuring that the Legal
Services Boardgives membership to a fair and proportionate
number of corporate users and qualified but non-practising solicitors
can the consumer panel truly call itself representative of consumers.
The thousands of in-house lawyers are a growing and important part of
the consumer body of legal services; they are possibly the largest such
consumers outside the Government. It seems unfair that they should be
excluded from representation on the so-called consumer
panel.
On 12 June, the
General Counsel 100 group wrote to the City of London Law Society
expressing its concerns. I have been passed a copy of the
letter:
“As you
know, GCl00 is the representative body for in-house counsel and company
secretaries of the top...FTSE companies. Legal services from
external law firms are necessary to the efficient running of the
organisations for which our members work and it is our members who are
responsible for arranging the purchase of these
services.
We would
welcome an amendment to the Bill in the terms you have suggested
allowing for representation of in-house counsel on the Consumer Panel.
Without this, we are concerned that the new regulatory regime for legal
services will not be suited to our needs and those of the law firms we
use. If this is the case regulation may well impact on the global
competitiveness of UK City law firms and our companies will look to
other jurisdictions for their legal
advisers.”
Our concern is
that, if those consumers continued to be excluded, the consumer panel
could lose its legitimacy and therefore much of its ability to be
productive.
John
Hemming:
We are also inclined to support this group of
amendments, because the concept of the consumer panel should be to
include those consumers who are not regulated by the process. As it
stands, if they are not practising solicitors or whatever, they are not
regulated but they are
consumers.
Mr.
Djanogly:
I should put the hon. Gentleman right on that
point: such people will not necessarily be practising solicitors, but
they may well
be.
John
Hemming:
We remember the phrase “qualified but
non-practising solicitors” from Conservative amendment No. 219;
that is all. The principle that consumers of services should be
represented on the consumer panel is
important.
John
Mann:
Conservative Members cannot help themselves. The
profession requires regulation, but they want to water it down to
protect vested interests, despite the fact that, under Standing Order
150(2)(c), advice will be required from the Parliamentary Commissioner
for Standards on whether the amendments can be moved. I await his
correspondence on that. I am sure that hon. Members have read the 2002
speech of the Chairman of the Committee on Standards and Privileges on
what it is and is not entitled to
do.
Leaving aside the
inherent and extraordinary vested interest, to suggest stuffing the
consumer panel with lawyers and finding a guise in which to do so shows
a lack of understanding of what the real world feels about the problems
of the legal profession. I hope that the Minister will outline the sort
of people who should serve on the panel. First, there should be someone
who has suffered industrial deafness, so that the absurd practices in
the legal profession that have taken place for decades can be properly
addressed by a decent, sensible consumer voice that
says, “Run your profession properly and fairly, and then have
the respect that you are
due.”
Bridget
Prentice:
Sadly, I cannot view this amendment with the
same positive attitude with which I viewed the previous one. I have
listened carefully to the arguments about corporate consumers of legal
services and whether lawyers and non-practising
solicitors generally should be represented on the
consumer panel. Clearly, there is a role for the corporate consumer on
the panel, but I cannot agree that the prohibition on authorised
persons sitting on it should be waived.
First, the establishment of the
consumer panel has a distinct purpose: to ensure that the voice of
consumers is clearly heard in the regulation of legal services. We have
striven to shift the balance, as my hon. Friend constantly encourages
me to do, from the interestsof the profession to the interests
of consumers. Thatis the principle behind the Bill. To allow
the panel’s independence from the legal profession to be
compromised—the amendments would do that by allowing authorised
persons to be members—would undermine that
aim.
Secondly, I am
not persuaded by the suggestion that authorised persons need to be on
the panel, so that the representations of large corporations as
consumers can be heard. If large corporations cannot find someone other
than an authorised person to represent themon the panel, they
are in a very bad way. I want to encourage large and small corporations
to be represented, but I want them to be represented by people who are
not authorised persons. In fact, under clause 8(4)(a), the board will
be required to ensure that membership of the panel includes fair
representationof business consumers, but they cannot be
represented by a practising lawyer. That will not
prevent representatives from the Federation of Small Businesses, which
has representatives on our own consumer panel, or large industry that
uses legal services regularly from being
represented.
Mr.
Kevan Jones (North Durham) (Lab): Does the Minister agree
that it is important to have trade union representation on the consumer
panel? Trade unions are large users of legal
services.
Bridget
Prentice:
Trade unions will have an equal
opportunity to present people to be members of the consumer panel, but
they cannot put authorised persons on the panel. Providers of reserved
legal services cannot be part of the body that is specifically set up
to consider the needs of legal services consumers. Creating a body that
voices consumer interests is important for those on the high street who
have not had their concerns or opinions adequately heard in the past. I
find this group of amendments wholly
unpalatable.
9.30
am
On amendment
No. 219, there is nothing to prevent “non-practising
solicitors” sitting on the panel, as long as they are not
authorised persons. “Non-practising solicitors” fall
outside the definition of an authorised person, and therefore outside
the prohibition inclause 8.
Talk of the principle of the
independence of the legal profession has been heard loud and clear, not
only in the Committee, but during six months of debate in the other
place. We have heard the concerns about the principle very clearly
indeed, but it must apply equally to the role of the consumer panel. If
we in this House are the first to make that argument, so be it. The
consumer panel must be independent of the influence of the legal
profession. On that basis, I shall not accept the
amendments.
Mr.
Djanogly:
In response to the hon. Member for Bassetlaw, I
am not and never have been an in-house lawyer. However, I recognise
their rights as consumers, whereas the Bill does not. I shall put the
hon. Gentleman right by saying that I did not suggest stuffing—I
believe that that was the word he used—the panel with in-house
lawyers; I simply said that they should be represented.
It might be that, generally
speaking, corporate and qualified non-practising solicitors who are
users of legal services are more business-savvy and so do not fall into
some of the pitfalls that individuals and small businesses do, but the
fact that the former group generally have more resources at their
disposal does not mean that they do not have similar problems and
issues that need to be resolved. Simply put, there are different types
of consumer problems. Granted, corporate and non-practising solicitors
might not face the same issues as those faced by individual users and
small businesses, but that is exactly why they need fair representation
on the consumer panel.
The whole idea of the panel is
to give a voice to the users of legal services, whoever they might be.
The panel must thus be adequately representative of all users. I fail
to see how the Minister can justify the exclusion of corporate and
qualified but non-practising solicitors, because they, too, are users
of legal services. She is in danger of damaging the credibility and
legitimacy of the consumer panel by taking such a negative position on
the amendments. That would be a shame. She should think again, which is
why we shall not be pressing the amendments to a Division. We will
reserve our position for a later stage, and I beg to ask leave to
withdraw the
amendment.
Amendment,
by leave, withdrawn.
Mr.
David Burrowes (Enfield, Southgate) (Con): On a point of
order, Mr. Cook. Reference has been made in the debate to
proper standards and there are concerns about vested interests. Given
the contribution on union representation, would it not be appropriate
for hon. Members properly to declare their interests as regards union
membership?
The
Chairman:
I hear what is being said, but it is a matter
not for the Chairman but for each individual Member. I suggest that the
hon. Gentleman look at the Register of Members’
Interests.
Mr.
Djanogly:
I beg to move amendment No. 218, in
clause 8, page 4, line 21, after
‘appointed’
insert—
‘(a) by the Board
following public advertisement and selection by the prevailing
standards for selection of members of public bodies
and’.
The
amendment would mean that the chairman and other members of the
consumer panel would not be appointed only on terms and conditions
determined by the board, but would be appointed by the board
“following
public advertisement and selection public advertisement and selection
by the prevailing standards for selection of members of public
bodies”.
The additional
wording is intended to ensure that appointments to the consumer panel
are made and seen to be made objectively. It is important that all
positions on the consumer panel be advertised publicly, so as to inform
a wide and varied group of people about their existence. That will give
all applicants a fair opportunity to apply for the panel. As a consumer
body, the panel needs to represent the consumer. A public advertisement
will therefore be the best means of ensuring that that is the
case.
Additionally,
it is important that the current criteria for selecting members of a
public body be applied, so that all applicants are given, and are seen
to be given, an equal opportunity to be selected. That is vital, as the
consumer panel is the voice of the public and it ensures that consumers
are given adequate representation. Any suggestion of favouritism in
selecting members could only damage the panel’s integrity and
cause people to lose faith in the efficacy of the
Bill.
Finally, it
should be noted that the amendment would enable the whole process of
selection for the consumer panel to become more transparent. That is
important if we wish to improve confidence in lawyers among consumers.
The Government support the Nolan principles, so will the Minister
confirm that they will apply to appointments to the consumer
panel?
John
Hemming:
As the question of declaring membership of a
trade union as an interest has been raised, I declare that I am a
member of a trade union and that I have a vote in the Labour
party’s deputy leadership elections. However, that is obviously
not the question under discussion. The amendment raises an interesting
point, which, as somebody with a track record in computer programming,
I view as a problem within statute.
John
Hemming:
I am not going to comment—[Hon.
Members: “Ooh!”] To be fair, I have
considered the question at great length, but I do not think that any of
the candidates warrant my vote. However, that is not really in order.
What is in order is to point out that many things in statute are
similar, in terms of how matters are processed. We have a spaghetti
systemof statute that has developed piecemeal. There
isa substantial argument for simplifying it, so that reference
is made to a standard form in the appointing of boards, for instance.
We support the principles argued for in the amendment, but over time it
would be better for the Government to consider developing statute in a
more structured
manner.
Bridget
Prentice:
The hon. Gentleman will have to tick the box, in
that he upholds the principles of the Labour party if he decides to use
that ballot paper. So I should be careful if I were him.
I have considered the amendment
in some detail. In fact, an identical amendment was tabled in another
place, so there is little between us on the issue of independence. I
like to think that the Committee and consumer groups know that the
Bill’s raison d’être is to put consumers at the
heart of the legal system. The prevailing standards of appointments to
public bodies are well known to members of the Committeeand,
to answer the question that the hon. Memberfor Huntingdon
asked, will be applicable to the appointment of the
panel.
For that
reason, there would be little to gain by including a more specific
provision in the Bill to the effect that those standards must be
followed. However, given that the appointments are to be made by the
board and not by Ministers, there would, strictly
speaking, be no compulsion to follow the Commissioner
for Public Appointments’ code of practice. I can see why setting
out those requirements in the Bill would give an assurance that the
appropriate appointment practice would be followed, however, and for
that reason I should like to take the amendment away for further
consideration, because I agree with what the hon. Gentleman has said on
the matter.
Mr.
Djanogly:
The Minister said that Nolan would not apply in
this case. We thank her for her constructive approach and look forward
to hearing from the Government later. On that basis, I beg to ask leave
to withdraw the amendment.
Amendment, by leave,
withdrawn.
Question
proposed, That the clause stand part of the
Bill.
John
Hemming:
I am a bit confused by the complications of
statute. Will the consumer panel be a bit like the House of
Lords—will people be appointed to it but never removed? What
will be the process for removing people from the consumer
panel?
Bridget
Prentice:
When people are appointed to the consumer panel,
they can be removed, and of course they can stand down. Clause 10
contains a procedure to deal with, for example, situations where
representations of the consumer panel are being considered by the
board, but it does not give any
specific indication whether members of the panel can be removed. If that
is a gap in the legislation, I shall have to consider it again to see
whether we need to make the situation absolutely clear. I am grateful
to the hon. Gentleman for raising the
question.
John
Hemming:
I thank the Minister for sharing my confusion and
I hope that we will achieve some
clarity.
Question
put and agreed
to.
Clause 8
ordered to stand part of the
Bill.
Clause 9
ordered to stand part of the
Bill.
Clause 10Representations
by the Consumer
Panel
Question
proposed, That the clause stand part of the
Bill.
‘Section
10 shall apply mutatis mutandis to representations by approved
regulators whether in their regulatory or representive
capacity.’.
Mr.
Djanogly:
Clause 10 deals with the proposal that the board
should be able to make representations to the consumer panel. My
decision not to move new clauses 1, 4, 5 and 6 was tied to our proposal
in new clause 3, which will hopefully be clearer now than if we had
gone through all the other new clauses as
well.
The new clause
would cause section 10 to apply mutatis mutandis, or with required
changes, to
“representations by approved
regulators whether in their regulatory or representive
capacity.”
I note that we
have received a strong representation relating to the clause from the
patent and trade mark institutes. Apparently, they met the Minister on
21 May at her request to discuss the changes made in the Lords and to
bring any concerns before Committee. They discussed with her their
disappointment at Baroness Ashton’s refusal, as they see it, to
honour a commitment to accept this amendment in the other
place.
On Report in
the Lords, Baroness Ashton stated that she accepted the principle but
not the wording of the amendment in Committee, and that on discussion
with ministerial colleagues, she had been advised that the Bill
provided a variety of means for consultation, and that no amendment was
therefore necessary. The institutes felt that the Minister had simply
reneged on her commitment. Apparently, they ran through the arguments
again with her, explaining why they felt that professional
representation was so vital. They argued that if the Government
accepted the amendment in principle, they should table a Government
amendment to make that explicit in the Bill.
My understanding is that the
Minister refused their request, saying that the Bill already contained
a number of obligations on the board to consult approved regulators. As
something of a compromise, she committed to writing to the patent and
trade mark institutes with a list of all the instances in the Bill
requiring the Legal Services Board to consult approved regulators, in
order to demonstrate that significant
consultation was already explicit. My understanding, although I have to
say that it is a few days old, is that the patent and trade mark
institutes have as yet received no correspondence. Does the Minister
intend to provide that information, and will she agree to present it to
the Committee if she
does?
The institutes
welcome new clause 3, on professional representations. Lord Kingsland
pursued the issue on their behalf at length in the Lords. The
institutes have concerns about the lack of a requirement on the board
to receive representations from approved regulators. The Minister has
argued that all the regulators are free to make representations to the
board, and that it would be expected to work in close partnership with
them, consulting them and listening to their views.
The institutes believe that
their position as regulators of a niche part of the legal services
market, and their limited resources and membership, differentiates them
from the likes of the Law Society or the Bar Council, which have larger
resources. They also have grave concerns that their voice will be lost
and their considerations overlooked by the board unless the Bill
contains a direction or other positive statement that the board should
have regard to representations made by legal services
providers.
9.45
am
We have
listened to the Government’s previous arguments against the
establishment of a practitioner panel and understand their concerns
that such a panel might jeopardise the role of the consumer panel, that
it would be bound to be appointed by the board and that it is difficult
to understand what provision could be made to ensure that any panel
that the board appointed was representative of the regulated sector,
rather than comprising people whom the board was happy to
consult.
That
position is supported by the Law Society and other regulators, so,
accordingly, we did not move new clauses 1, 4, 5 and 6. Instead, we
proposed a simple addition to the Bill to ensure that the Legal
Services Board has a duty to consider any representationsmade
by the regulatory or representative bodies of the professions. That
approach mirrors the provisions in clause 10.
We were disappointed by
Baroness Ashton’s response when the issue was raised on Report
and on Third Reading in the other place and by the subsequent feedback
that the institutes received in their later discussions with the
Minister and her team in the Ministry of Justice. The institutes feel
that Baroness Ashton backed out of a commitment that she made in
Committee in the other place when she acceptedthe amendment in
principle. On the back of that acceptance, she persuaded other peers to
drop their later amendments, because the Government had accepted
amendment No. 38.
We
agree on that point and therefore propose that the Bill should
explicitly state that representations to the board by the professions
must be considered. The Government appear to have made a U-turn. We
urge them to accept the amendment or, at least, to agree to return with
another amendment to meet this important
point.
John
Hemming:
We are inclined to support new clause 3, the
argument being that we are asking that the board consider any point
made to it and to respond with reasons why it disagrees. That is
entirely reasonable. There is an interesting legal question about
whether it would have to do that anyway, but it is far better
explicitly to include such a provision in the Bill. It is only
reasonable that the board should respond in writing to representations
made to it, giving reasons for disagreeing with
them.
Mr.
Bellingham:
I should like to add a couple points to the
excellent argument put forward by my hon. Friend the Member for
Huntingdon. First, the Committee will be aware that the patent and
trade mark institutes are small professional bodies and thus will be
small niche regulators. I stress that their future could be put at
risk, because they are not closed professional bodies in the sense that
one could still practise as a patent or trade mark attorney if one were
not a member of the relevant institute.
Such people join their
institute to give themselves added credibility, clout and professional
recognition. However, if they feel that the institutes are being cast
to one side, not listened to and perhaps undermined over time, they
will have every incentive not to pay their levy or fee to their
professional association and to go it alone. Those two important
institutes have been to see the Minister and the Department and have
lobbied members of the Committee. The institutes feel strongly that if
they lose their critical mass—we are only talking about 2,000
members in total—they could wither on the vine. That is why it
is important that they are given extra standing and credibility under
the new clause. My hon. Friend’s arguments are spot
on.
I also agree with
what the hon. Member for Birmingham, Yardley has just said. Looking at
things in the round, I do not understand how anyone could disagree with
the proposed new clause being added. If anything, it would add weight
and muscle to the consumer panel. It would not, in any way,
dissipatethe consumer panel’s impact; it would
complement the work being done by it. I urge the Minister to consider
the new clause
sympathetically.
Robert
Neill (Bromley and Chislehurst) (Con): I should like
briefly to support the observations that have already been made by my
hon. Friend the Member for North-West Norfolk. First, it is important
to bear in mind that, if we are going to make the consumer panels
system work, there must be a maximum buy-in from the organisations that
responsibly seek to represent various elements of the profession. The
trade mark and patent attorneys, with whom I have had no professional
connection, dealwith a small but important area of work. Even
large representative organisations, such as the Bar Council, find it
difficult to ensure that people think there is value in joining and
belonging to them. In fact, they can, within the structure of the Bill,
do a valuable job, at a certain level, in
self-policing.
It is
much better that people in the trade mark field have an incentive to be
members of an associationthat provides a pretty
cost-effective, useful means of bringing together
representative views. All the professional organisations in the legal
sphere carry out a degree of
valuable self-policing as well, which is sometimes not recognised. It is
much better to give people an incentive to belong to such organisations
than their being tempted to freelance. We should remember—others
will—that, on the liberalisation of the conveyancing rules some
years ago, there was concern that some people were attempting to
operate outside any of the professional frameworks, which was for the
worst. That has been dealt with. It is right that we should build in
the incentive now, for the same
reason.
Secondly, it
is important and desirable to place an explicit obligation on the panel
to state why it disagrees with representations from the professional
bodies, as it may, for good reason. That point was fairly made by the
hon. Member for Birmingham, Yardley. It struck me that the same
principle was involved, albeit in a different context, in dealing with
the Greater London Authority Bill. The Government have sought to
strengthen the transparency of the relationship between the Mayor and
the assembly, by placing a duty on the Mayor and the functional bodies
in greater London to state why, having consulted and disagreed with the
assembly, they disagree with it. That makes the whole process more
robust from the point of view of the consumer, the professional bodies
making the representations and the public at
large.
The Minister
and her colleagues have talked a lot about the importance of
transparency, and the new clause would underscore that. I hope that the
Government feel that the new clause is not trying to wreck or undermine
the thrust of what they are trying to do, but that it is trying to make
things
better.
Bridget
Prentice:
The new clause would place approved regulators
on an equal footing with consumers in relation to any representations
to the board. I do not consider it to be necessary, because, as I have
already said, there are many provisions in the Bill under which the
board and the Office for Legal Complaints might consult and consider
representations made by approved regulators. However, before I come to
that, I endorse the comments made about the patent and trade mark
institutes—those small but important bodies—and the niche
market that they represent. I have met them and discussed their
concerns. In relation my writing to them, they wrote to me on 4 June
setting our their concerns, and I understand that I shall reply to them
this evening.
Let me
list some of the provisions in accordancewith which the board
or the OLC must consider representations: clauses 31, 35, 46, 47, 50,
58 and 66, schedules 7, 8 and 9, clauses 78 and 81, a raft of
provisions in schedule 10, clauses 143 and 145, clauses 127, 132, 133,
136, 141, 139 and 206, clause 179, schedule 4, clause 180, schedule 7,
and so on. It is therefore a myth that the OLC and the Legal Services
Board will not listen to representations from the legal profession, and
I hope that by reading out that list of provisions that are already in
the Bill I have squashed the myth.
John
Hemming:
Is the Minister therefore confirming that, if
there were a disagreement, the OLC and the Legal Services Board would
have to respond with reasons?
Bridget
Prentice:
Certainly, if the OLC was making directions, it
would have to give reasons. In the general course of things, it would
be good practice for the board also to give reasons for rejecting
certain representations if representations had been made. I am
confident that the position is already
covered.
Bridget
Prentice:
It is not currently my intention to issue
guidance. The Bill is not designed to fetter the way in which the Legal
Services Board will conduct its operations, and I do not want to impose
any fetters, but I might consider whether it is appropriate to issue
guidance.
Robert
Neill:
On that point, the Minister has said that she hopes
that reasons will be given as a matter of course if there is a
disagreement—I think that thatis the right
view—but can she really envisage a circumstance in which it
would be appropriate for the board or the panel not to give reasons?
Given that it is almost inconceivable that they would not, will
she—in the same constructive way that she indicated she would
think again on a previous issue—reconsider whether an explicit
requirement could be made, in guidance or in a short amendment to the
Bill, to give comfort to all the political parties that good practice
will be entrenched? Surely no harm would be done to the Bill’s
purpose by making it explicit that reasons for disagreement should be
given.
Bridget
Prentice:
In considering whether guidance should be given,
I shall certainly look at the issue in the round and consider whether
the hon. Gentleman’s suggestion would be an appropriate way to
proceed.
John
Mann:
Before the Minister goes too far, willshe
consider also that there might be extenuating circumstances? Let us
take the examples of an inquiry by the Serious Fraud Office into
certain practices or investigations that have not yet reached that
stage but in which malpractice—perhaps routine
malpractice—is suspected. There might well be a wish for
pre-emptive action in such cases, but there might be reluctance to give
precise reasons for a decision on the basis that providing too much
detail of other activities could prejudice other regulatory
action—for example, bythe
SFO.
Bridget
Prentice:
My hon. Friend makes a good point, and that is
exactly why I cannot commit todayto imposing a requirement on
the board that it give reasons or to issuing guidance. As he has
rightly pointed out, there are instances in which it might be
appropriate for other action to be
taken.
Before I move
on, I have one other comment on the issue concerning patent and trade
mark institutions that was mentioned by the hon. Member for Bromley and
Chislehurst. If people opted out of those institutes, they could not
exercise reserved services and they would not have rights of audience
to conduct litigation associated with patent and trade mark work.
They would be diminishing their own ability to do that work if they
chose to opt out of the institute. That is an important point to
make.
There is a
general statutory right for the approved regulators, of which I have
listed some already, to have their representations heard, and there
will be an obligation on the board to provide a notice setting out its
reasons when it disagrees with the regulators. To go further would be
to create a system that is too heavily tilted towards the
profession.
10
am
I
have said in previous sittings that it is well established and clear
that authorised persons have well organised and well funded bodies to
represent their interest. They have extensive experience of making
representations to other regulatory bodies, and we need only to
consider the way in which their representations were taken up
successfully in the other place to know just how influential they are.
Consumers need a general right of representation to balance that
situation out, and the Bill creates that balance.
If the LSB fails to account of
the authorised persons’ views in reaching a decision, they will
be able to go to judicial review. They know how to. I do not have any
fear that the authorised persons will not use all the powers that are
available to them to ensure that their voices are
heard.
Mr.
Burrowes:
On the substance of the issue, however, is it
not important that the Government continue to reflect on the clear-cut
undertaking given in the other place to accept the amendment that has
now been moved in this Committee? Not to do so would be ironic, given
that we are dealing with regulatory objectives that include upholding
the rule of law and the constitutional principle and convention in the
other place, whereby such an undertaking should be properly followed
through. It has not been followed through, and Lord Kingsland’s
words still apply: the Government should be ashamed of
themselves.
Bridget
Prentice:
When I conceded some of the arguments that were
made earlier, I said that I could not accept them directly, because I
had to take on board the views of others in the form of collective
responsibility. The amendments would undermine the consumer’s
voice, which is at the heart of the Bill. The legal professions are
more experienced than anyone else in making their views heard, as they
have done so clearly and successfully in the other place. It is time to
redress the balance.
I draw hon. Members’
attention to clause 3, inwhich the board is required to be
accountable and transparent. It must publish an annual report under
clause 6, and use that opportunity to demonstrate that it has given
proper consideration to the representations made by consumers and
practitioners. Practitioners already have a strong voice in the system,
and if Iwere to accept the amendment, I would undermine
consumers’ weak voice and the Bill’s attempt to
strengthen it. I therefore reject the
amendment.
Mr.
Djanogly:
I thank the Minister for confirming that she
will write to the patent and trademark agents later today. It would
have been helpful to have had that
information for the debate today, but there we are. The hon. Member for
Birmingham, Yardley and my hon. Friends the Members for North-West
Norfolk and for Bromley and Chislehurst all made excellent cases,
saying that the amendment is reasonable and straightforward. My hon.
Friend the Member for Bromley and Chislehurst made the important point
that it would improve transparency, and I agree with everything that
they said. My hon. Friend the Member for Enfield, Southgate was right
to make the point about the promise that was made by the Minister in
the Lords, which has been broken.
The arguments have been put,
and I do not want to go around the houses again. We do not consider
that the Minister is right in her arguments, and I simply cannot see
how the balance could be tipped in favourof regulators, as she
put it, by what we see as a straightforward amendment. I thank her for
agreeing to consider whether guidance will be published, but at this
stage of the proceedings, I shall seek to press the new clause to a
vote.
Question
put and agreed
to.
Clause 10
ordered to stand part of the
Bill.
|
| |
| ©Parliamentary copyright 2007 | Prepared 18 June 2007 |