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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(Afternoon)[Frank Cook in the Chair]Legal Services Bill [Lords]Clause 11Advice
and research functions of the Consumer
Panel
Amendment
proposed [this day]: No. 222, in
clause 11, page 5, line 10, after
‘Board’, insert ‘or on its own
initiative’.—[Mr.
Djanogly.]
1
pm
Question
again proposed, That the amendment be
made.
The
Chairman:
I remind the Committee that with this we are
discussing the following amendment:No. 223, in
clause 11, page 5, line 16, at
end add—
‘(4) In acting on
its own initiative under subsection (1), the Consumer Panel shall not
impose any costs on any of the approved
regulators.’.
Mr.
Jonathan Djanogly (Huntingdon) (Con): My hon. Friend the
Member for North-West Norfolk made the valid point that the commitment
set out in the amendment should not become open-ended. I totally agree
with that, and it is a point that we tried to address in the second of
our amendments in the group. The Minister also picked up on that point,
in a rather dismissive way, I thought. She dismissed our efforts to
reduce the exposure, by saying, “Well, even if you put that in
place it still wouldn’t work”. To be frank, it is true
that the amendment might not be enough, but we were trying to make the
point that just because the original amendment would need to be
limited, that does not mean that the thought behind it was wrong. We
simply need to look at the issue in a more constructive
way.
The hon. Member
for North Southwark and Bermondsey said the measure was standard
practice in other bodies, and the Minister disputed that. I think that
she gave the example of Ofcom. Having the advantage of the break, I
thought that I would have a quick look at the provisions for Ofcom,
which are quite interesting. Section 16(6) of the
CommunicationsAct 2003 states:
“The arrangements made
by OFCOM under this section must also secure that the Consumer Panel
are able, in addition to giving advice on the matters mentioned in
subsection (3), to do each of the
following—
(a)
at the request of OFCOM, to carry out research for OFCOM in relation to
any of the matters in relation to which OFCOM have functions under
section 14”.
That
obviously is similar to what is in the Bill. However, section 16(6)(b)
says
“to make
arrangements for the carrying out of research into such other matters
appearing to the Panel to be relevant to the carrying out of the
Panel’s functions as they think
fit”.
The
Parliamentary Under-Secretary of State for Justice (Bridget
Prentice):
I absolutely agree with the hon. Gentleman. I,
too, have had some research done during the break, and he is quite
right. I inadvertently misled the Committee by quoting section 16(3) of
the 2003 Act, when in fact, as he rightly points out, section 16(6)(b)
allows the Ofcom consumer panel to carry out research into matters that
it perceives as relevant to its work. Of course, the consumer panel
also has a memorandum of understanding with Ofcom regarding the scope
of the panel’s research, which it set out at the beginning of
its year. On that basis, I am happy to put the record straight on that
aspect of the debate.
Mr.
Djanogly:
I thank the Minister for that clarification, but
it means that we have established that there is precedence in other
regulatory systems for the amendment that we are suggesting. The hon.
Member for North Southwark and Bermondsey was rightto bring
the matter up. What is suggested by the amendment is not unusual and it
exists elsewhere. The amendment is rational and makes sense, but we
have concerns about cost and the other issues that the Minister
mentioned.
John
Hemming (Birmingham, Yardley) (LD): On cost, the same
briefing from the National Consumer Council makes the point that Ofcom
has a budget for the consumer panel to handle matters, so its costs are
to that extent controlled. That makes amendmentNo. 223
potentially
otiose.
Mr.
Djanogly:
That is not necessarily the case, because the
money would otherwise come from practitioners in such circumstances.
However, I appreciate the hon. Gentleman’s point, in so far as
the issue would need to be looked at again, and there is existing
precedence for the process working in other scenarios. As a way of
going forward, therefore, the measure should be looked at instead of
simply being dismissed, as the Minister did earlier.
On that basis, we would like
the Minister to look at the issue again. She has come back to it once,
and perhaps she will return to it again when she has more time.
Therefore, in order to allow it to be looked at again, I beg to ask
leave to withdraw the
amendment.
Amendment,
by leave, withdrawn.
‘(4) It shall be
the duty of the Board (subject to subsection
(5))—
(a) to provide the
Consumer Panel with all such information as, having regard, in
particular to the need to preserve commercial confidentiality, the
Board considers appropriate to disclose to the Panel for the purpose of
enabling the Panel to carry out their functions;
and
(b) to provide the Panel
with all such further information as the Panel may
require.
(5) The Board is not
required to provide information by virtue of subsection (4)(b) if,
having regard to—
(a)
the need to preserve commercial confidentiality,
and
(b) any other matters that appear to the Board to be
relevant,
it is reasonable for the Board
to refuse to disclose it to the
Panel.’
This
amendment again comes from the National Consumer Council, and we have
tabled it on a probing basis. It would work alongside amendment No. 222
by ensuring that the consumer panel has access to the information that
it needs to carry out its functions—information held by the
board, subject to appropriate restrictions. Just as an individual needs
the appropriate resources in order to do their work, so the consumer
panel requires access to certain information in orderto carry
out its work to the highest possible level. However, the amendment also
recognises that there may be some instances in which it may not be
appropriate for the consumer panel to receive such information.
Therefore, the amendment would give the Legal Services Board the
discretion to decide on such cases.
John
Mann (Bassetlaw) (Lab): “Commercial
confidentiality” is a term that I have heard quoted a lot in the
context of this Bill, and it has been quoted to me in numerous cases.
One of the big issues is that individual members of the public, who,
for example, wonder whether to make complaints against solicitors,
often struggle to get hold of their files from the solicitors. Another
example could be that of a coal miner—someone who knows nothing
about the law, has never had to deal with the law and is not an expert
on compensation schemes, but who nevertheless wants to know whether
their case has been handled properly. He might like his Member of
Parliament to take a look at his file to see whether the services
aspect of the claim has been put in.
The services aspect of the
claim can be three, four or five times the amount of the rest of the
claim, so this is not a small issue. However, only someone with the
relevant knowledge would be able to identify whether or not the case
contained a potential services claim that had not been applied for.
That information can only be found by looking at the file. However,
certain solicitors refuse to hand over those files, and at the moment,
self-regulation appears powerless to do much about that. Where is
access to justice in relation to that?
Some paperwork has been refused
on the basis of client confidentiality. Let us take the example of a
contractual arrangement between a claims handling company and a
solicitor that the individual concerned does not know about it. How can
that individual make a rational decision about whether they have a
justified complaint, if “commercial confidentiality” is
cited as a reason not to give copies of the information?
Let us take a more generic
case, because this is exactly the kind of issue that the panel should
look at. Let us say that an industrial injury claim is given to a legal
executive who has no great experience and no precise knowledge of the
law, and who routinely gives that work to a barrister, who examines it
in the same way that a member of the Committee might and writes a short
report in 10 minutes, spelling out what is a straightforward case. The
barrister sends it back and charges the solicitor’s company,
which passes it on to the individual. The individual can do nothing
about that, but how does he know what transactions took place, to
enable him to make a complaint and say that
he had been hoodwinked because the issue did not require a barrister? A
barrister was used only because, unbeknown to the individual, the
solicitor had passed the papers to an executive, not a solicitor. The
paper trail required can therefore be deemed to be commercially
confidential.
For the
consumer panel or the Legal Services Board to know whether the
transaction had been done routinely, it would need access to what
clearly could be described as commercially confidential documents, such
as those relating to the financial relationship between the solicitor
and the barrister or, say, a solicitor and a medical handling company.
The solicitor might have just happened to set up such a company, passed
the medical case through it and taken a cut of the money. Moreover, as
we have seen inmany cases, such a relationship might be with a
loans company that is giving out large loans for legal expenses and
receiving good commission. The case might be shared around. Many such
issues might be deemed worthy of examination by the consumer panel or
the board.
The
restriction of confidentiality in such matters is absurd. It means that
the very issues that need exploring will not be explored. While it is a
slight point, given some of the amendment’s aims, it masks a
greater sin, which is the ability of the consumer or the individual to
receive redress. More important is the consistent ability to look at
the overall system and advise the board—and perhaps
Ministers—of the law and weaknesses within the system that have
been legally but, in some eyes, immorally exploited by those in the
legal profession. Hiding behind commercial confidentiality has been the
precise tactic used by particularly wealthy solicitors who have
benefited from their interpretation of the rules in such
claims.
Simon
Hughes (North Southwark and Bermondsey) (LD): My hon.
Friend the Member for Birmingham, Yardley and I both support the
amendment because it has merit. I had not intended to say much more
than that, but I have now been prompted to do so because the hon.
Member for Bassetlaw has made a good point. I completely understand the
concern that, if the conventional phrase is put into legislation that
states that it shall be the duty of the
board
“to provide the
Consumer Panel with all such information as, having regard, in
particular to the need to preserve commercial
confidentiality”,
it will
bring about an undefined and potentially broad
exemption.
I spend
much of my time wondering why so much local
government information is secret. The most common reason given is that
something is commercially confidential. We could be talking about the
largest piece of publicly owned land in our constituencies and the
generally held view that members of the public, their councillors and
their Member of Parliament should know what is going on, but then be
told that it was not something for whichwe could see the
paperwork. I agree with the hon. Gentleman in that, if we were to have
such a good proposal and if there were to be limits, there would have
to be a clear definition of the
limits.
The Minister
might be able to answer, either now or later, a question asked in that
regard. I am not sure whether this is dealt with later in the Bill,
because I
have not checked. Does the Bill addresses the question of commercial
confidentiality? The convention exists that when you, Mr.
Cook, the Minister or I employor engage a solicitor’s
firm, the relationship is confidential, unless it comes out into the
open because we take action against another party or because the matter
goes to court. That is right and proper.
The proposal is a good one. I
understand the point about not wanting to make it effectively useless
by making the exemptions so big. Perhaps the Minister could help us by
deliberating on that. The hon. Member for Huntingdon and his
colleagues, and my colleagues and I, could deal with any issues that
need
addressing.
1.15
pm
John
Hemming:
I rise to support what the hon. Member for
Bassetlaw has said. There is an issue about the transparency of
payments, but, in practice, the amendment would start by giving a duty
to provide some information to the consumer panel. Without such a
provision, there would be no duty to provide it with any information.
The transparency of payments is clearly an important point, but it is
not necessarily part of
this.
Mr.
Henry Bellingham (North-West Norfolk) (Con): The amendment
would place a duty on the Legal Services Board to provide information.
Surely that would be a great deal better than the clause, as drafted.
As the hon. Member for Birmingham, Yardley pointed out, there is no
obligation or duty on the board to provide any information. That is why
clause 11 is deficient. It states:
“The Consumer Panel may,
at the request of the
Board”.
It
continues:
“The
Board must consider any advice given... The Consumer Panel may
publish such information as it thinks fit about advice it
gives”.
There is no duty
on the board to provide information.
I take on board the point made
by the hon. Member for Bassetlaw. In our enthusiasm to widen the scope
of the clause and to ensure that provision was made for such a duty, we
decided that we would be cautious, which is why we included the
qualification about preserving commercial confidentiality. Surely he
would agree that amendment No. 224 would improve the clause, despite
his concerns about the commercial confidentiality qualification. I
notice that he did not table an amendment to improve the clause
further, in a way that he would find more powerful and effective than
our proposal.
We are
trying to sing from the same hymn sheet, because we are trying to give
the consumer panel much more power, influence, focus and direction. We
hope that it will therefore attract large numbers of high-calibre
people to serve on it. In the light of the Committee’s debate, I
hope that the Minister will look sympathetically at our
proposal.
Bridget
Prentice:
Being the magnanimous person that I am, I agree
that the consumer panel should have all the information that it needs
to carry out its
functions. The amendment clearly seeks to allow it to make requests in
that regard. It is important to recognise that clause 10 already
enables it to do so, simply by making representations to the board,
which would be obliged to consider them. It is likely thatthe
board and the consumer panel could agree a framework,
not unlike the memorandum of understanding between Ofcom and its panel.
I have made reference to that arrangement.
John
Hemming:
Looking particularly at clause 10, it seems that
the Legal Services Board will be more likely to know what information
may be necessary for the consumer panel. If the consumer panel does not
know that some information is necessary, it cannot ask forit.
That is why the duty to provide information is stronger than a
situation where the panel can ask for information and be told that it
cannot have it.
Bridget
Prentice:
I understand the hon. Gentleman and take that
point, which is why I shall be quite positive in my response to the
amendment. I wish to put on record that it should be clear from the
very fact that we are establishing a consumer panel that we want it to
be furnished with the information that it needs.It is
fundamental that the organisation that makes representations to, and
consults with, the board conducts research, gives advice as requested
and receives the information that it requires. How else could it
achieve the aims that we have set out? However,I have a couple
of niggling concerns about the amendment; I am not entirely convinced
that it will achieve what hon. Members want. I ask the hon. Member for
Huntingdon to withdraw the amendment on the basis that I will
positively consider the matter to find out whether we can come to some
arrangement.
My hon.
Friend the Member for Bassetlaw rightly highlights at every opportunity
some of the scandalous practices that have taken place as regards some
of our constituents. On access to information, a client should be
entitled to the file that relates to their case. Under the Bill, if
they are not satisfied with the service provided by a lawyer, they can
go to the Office for Legal Complaints. The ombudsman will have the
power to require a party to a complaint to provide all the documents
and information necessary to consider it, which is a wide-ranging
power. I shall discuss the amendment further with consumer groups and
other stakeholders to ensure that we achieve exactly the hon.
Members’ aims.
Mr.
Djanogly:
The Minister’s response has been
heartening, and we understand her wish to consult further on the final
product, not least in light of the valid comments made by the hon.
Members for Bassetlaw and for North Southwark and Bermondsey on the
definitions and breadth of the exceptions, the transparency of payments
and the need to define clear limitations. I hope that those points will
be teased out in the days to come. 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.
Mr.
Bellingham:
I remind the Minister that, during the
discussion on amendment No. 222, I suggested that various outside
organisations and consumer bodies, such as Which? and the NCC, might
possibly provide research material to the consumer panel. The panel
will carry out a number of major projects, and we want it to have a
wide range. A consumer group might be involved already in a major
campaign that involves informing its membership, with articles in a
publication or surveys and questionnaires.
Such campaigns might be on all
fours with a consumer panel initiative, and it would be sensible if the
two initiatives could be brought together. Will the Minister tell the
Committee whether she sees any merit in such an approach and whether
she is attracted to my suggestions? The clause stand part debate is the
time to look into the matter in more detail. I should be most grateful
to the Minister if she gave me some indication of her
views.
Bridget
Prentice:
I am very sympathetic with the hon.
Gentleman’s suggestion. The clause will enable the consumer
panel to carry out research and give advice to the board, following a
board request, and any opportunity for the panel to pick up on good
research should be welcomed. I am not in favour of reinventing the
wheel. If certain consumer organisations were doing research,
therefore, it would be foolish for the consumer panel not to be able to
access it. I shall consider whether there are ways in which we can
provide encouragement for the hon. Gentleman’s
suggestion.
Question put and agreed
to.
Clause 11
ordered to stand part of the
Bill.
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