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The strength of new clause 2 is that it would enable us to hold more than one review. That reflects the fact that we may not get the scheme right straight away. We may need to consider how the scheme operates in its first three years, and we may then say that we need to come back for a second review. However, that second review might be the last review that is needed, if people are happy that the review has been properly carried out. That capacity to hold a review beyond the initial period is one of the key distinctions between new clauses 2 and 3. New clause 3 does not go far enough. It does not provide the comfort that I am looking for on the issue of the scheme being kept under regular and frequent review.
I am being optimistic, of course, but I would much rather that the Government withdrew new clause 3. New clause 2 provides a far more effective sanction and check, and offers far more effective scrutiny of the operation of the reclaim fund, than new clause 3 does. I hope that I have persuaded hon. Members that that is the case and that they will join us in the Division Lobby. However, the Government have moved some distance on this. When the matter was first raised in the other place, the Government were reluctant to accept a triennial review.
Mr. Jim Cunningham (Coventry, South) (Lab): Surely common sense would dictate that if further reviews were necessary in the light of new information, the Government would carry them out, so there is no need for new clause 2.
Mr. Hoban: I would rather have the comfort of knowing that the Government were obliged to have another review, rather than leave it to the whim of Treasury Ministers. That is a much more secure basis on which to have the review than to allow one review and for the matter then to be put back on the shelf and forgotten about. The requirement to have ongoing reviews, with the Government able to determine when those reviews should stop through the statutory instrument process in my new clause, would be a far better safeguard for consumers and voluntary groups and would show that the scheme was working effectively.
Mr. Cunningham: Surely common sense would dictate that if further reviews are needed they will be held. How many reviews does the hon. Gentleman think we should have?
Mr. Hoban:
The answer is that I do not know. We may have to have a review every three years until the end of time, although I suspect that that is not the answer. Equally, I am not certain that just once is the answer either. That is why new clause 2 seeks to place on the statute book the requirement for there to be further reviews until a statutory instrument removes that obligation. My new clause would give people greater certainty about the scrutiny of the process than the Government’s new clause. We are talking about money that belongs to consumers, to our constituents. I want to ensure that the reclaim process works properly and effectively, and when we are talking about potentially £400 million or £500 million, I am not sure that one review is sufficient. If the scheme is deemed to be working well at the end of one review, the Government could bring forward a statutory instrument to remove the obligation to have
any future reviews. My suspicion is that one review will not be enough, and there will be a need for a second review. Therefore, rather than let it be at the discretion of the Treasury, it is important that Parliament should determine that there should be the capacity to have regular reviews of this issue.
That is the main area where there is a difference between new clauses 2 and 3. I do not think that new clause 3 provides the comfort and assurance that the voluntary sector and consumers are looking for, and that is why it is deficient. New clause 2 offers much greater protection to the voluntary sector and consumers that the scheme will work in both their interests.
Keith Vaz (Leicester, East) (Lab): I did not have the pleasure of serving on the Committee, but judging from the speeches of my hon. Friend the Minister and the hon. Member for Fareham (Mr. Hoban), it sounded like a particularly civilised Committee stage. I do not know whether I am right or wrong. The hon. Gentleman feels that new clause 2 is slightly better than the Government’s, but I am not sure whether he will seek to divide the House. There is consensus on the need to review how the legislation operates, and I welcome the common-sense approach taken by my hon. Friend in tabling the new clause. He seems to have accepted the views put forward in Committee by both the Conservative party and the Liberal Democrats—whom we have yet to hear from, so I hope I am not misquoting them in advance.
My only concern is the need for a degree of independence in the process, given the current climate. I understand why this has to be led by the Treasury—this is an idea that comes from the Treasury and Treasury Ministers—but it is important that the Government allow some degree of independence in the review process. We have not had this process before, but I envisage people being able to make written representations to the Treasury within a time scale enabling the review to take place. I am not sure whether that is what the Minister has in mind, or whether he proposes to elucidate further on how the process works, but it is important that we get as much detail as possible on the record, so that once the review process begins, people feel that it is open and transparent and they can put forward their views about how they can best express their concerns over what is happening.
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As the hon. Member for Fareham said, we are dealing with other people’s money, so we need to be very careful about how the state claims and uses it, even though it may be for appropriate reasons and for good works. It is going through the lottery agencies and so on, so it must be for good things; it cannot be for bad things. Despite that fact, people need to have the confidence of knowing that there is a proper and transparent approach, but that degree of independence is missing from new clause 3. I do not know whether this was the case but, as the new clause was probably drafted over the weekend, as such things are when Report approaches, perhaps there was no chance to think about the issue more carefully. However, when the Minister replies, perhaps he will give us that degree of assurance—that that independent element will appear somewhere in the process.
I recognise that other Members have followed the Bill through its various stages and are therefore experts on these matters, bit I should like to ask the Minister
whether the proposal will also cover dormant accounts from banks that are in liquidation. He will know that the Bank of Credit and Commerce International has been in liquidation for 17 years. It is an ongoing process, and there is clearly enough money to cover all the money that is left in that bank. Might we apply the legislation to the people whose bank accounts were, in effect, frozen on 5 July 1991 and, if we add the Government’s proposed 15-year period to the 17 years of liquidation, have had dormant accounts for 32 years? Has he considered the issue of a bank that has been insolvent or in liquidation for the huge length of time that BCCI has? There are still bank accounts that were dormant on 5 July 1991 and, presumably, still sit in BCCI in liquidation. The money is still there, and nobody has done anything with it. Has the Minister looked at that? When he replies, will he please reassure people who still wish to claim those accounts that something is being done as the Bill reaches its final stages?
Mr. Jeremy Browne (Taunton) (LD): It feels as though we are dancing on the head of a pin when there are rather more pressing matters facing the banking sector. Nevertheless, that is perhaps inevitable at this stage of the legislative process. I welcome the fact that at all times, in the other place and in Committee in this House, the Bill has broadly commanded cross-party support. That is reflected in the Government’s new clause 3, which I welcome. I am grateful to the Government for listening to the representations that were made in Committee and for seeking, to some extent, to accommodate the concerns that Members from all parties expressed.
With this legislation, there is, after all, a sense that we are entering slightly different territory, and, even though the headline concept is fairly straightforward, we are not certain about how some aspects of it will pan out in practice: whether 15 years, for example, will be an appropriate period for a bank account to be deemed to be dormant; the nature of the reclaim for people who want access to their funds after that 15-year period has elapsed; the mechanisms for distributing the money and the causes that it goes to; and many other features of the legislation besides. So my colleagues and I have always taken the view that some sort of review mechanism would be healthy and in the interests of the Government. The amendments, both in the other place and in this House, were not about Opposition point-scoring to try to put that process into the legislation; they were well-intentioned, and I am pleased that the Minister and his colleagues have sought to accommodate them and seen the wisdom in trying to take that approach.
My party’s view in both Houses has always been that the review should be regular, although in Committee I was, like the hon. Member for Fareham (Mr. Hoban), happy to concede that having a review every three years for—as he put it—“the rest of time” might be somewhat excessive. No doubt, over a period the legislation would settle down and people would feel confident with how it worked in practice.
Our concern now—as I said, we are dancing on the head of a pin somewhat—is whether one review is sufficient or whether subsequent reviews may be required. If they are, should that be expressed in the Bill or should the Government freely come to a conclusion
about the issue after they have conducted one review? The margins of difference between us are pretty small, but in so far as the issue matters, I would prefer the legislation to express a mechanism for further reviews.
Having said that, I should say that new clause 2 is rather loosely worded. I can see why Opposition parties would wish to support the new clause because of the broad principle of having more than one review. The Government, however, may be anxious, with their majority, about putting into legislation provision for carrying out reviews “From time to time”, as new clause 2 states. That seems extremely loose; it could mean anything—every 50 years, I suppose. On that basis, the Government could easily either bring forward reviews or completely ignore new clause 2, even if it were passed by the House today, on the basis that having a review a century from now would not be sufficiently frequent or urgent.
In Committee, I made a concession when I had tabled a similar amendment that would have required the Government to consult “those affected” by the legislation. I was criticised by other Committee members, and I conceded that their criticism had some legitimacy and that my wording was too loose for a consultative process. However, new clause 2 would require the Government to consult
“those persons who it considers to have relevant knowledge”.
That strikes me as entirely open to interpretation by those undertaking the review. I take the point made by the right hon. Member for Leicester, East (Keith Vaz), who said that if the Government are reviewing their own legislation and are required to consult only those it regards as having “relevant” knowledge, they will pretty much have a free hand to consult whomever they see fit to consult—they may choose to consult only those who are likely to give the answer that they wish to hear.
Rob Marris (Wolverhampton, South-West) (Lab): Does the hon. Gentleman agree that the scope of new clause 3 is rather tighter than that of new clause 2 in respect of the topics that must be included in the review? I shall not read out new clause 3(2), but it seems more onerous on the Treasury in respect of the review than the provisions under new clause 2. New clause 3 seems more desirable in that respect.
Mr. Browne: I agree. New clause 3 is better worded; it might have been drawn up over a weekend, but new clause 2 must have been rushed through the drafting process much more speedily than that this morning. New clause 3 is more tightly defined, but new clause 2 has provision for subsequent reviews, whereas new clause 3 does not. Those who would prefer more than one review, or at least the option of that, may be tempted to support new clause 2. As I am of the view that the option of more than one review may be desirable, I am more sympathetic to the objectives of new clause 2, although I see that the drafting of new clause 3 has greater merit.
Rob Marris:
I am grateful to the hon. Gentleman for his generosity in giving way. As he pointed out, this is a case of angels dancing on the head of a pin, given that both new clauses rely on the discretion of the Treasury. New clause 2 says that reports should be prepared
“From time to time”; as the hon. Gentleman pointed out, that is an incredibly elastic phrase. Under new clause 3, there is nothing to prevent there being more than one report, although there is no provision that there should be more than one. New clause 2 adverts slightly to there being more than one report, but “From time to time” is so elastic that both clauses would leave the issue to the discretion of the Treasury.
Mr. Browne: That sums up our debate rather well. I hope that Members present do not feel that their time is not being spent sufficiently productively.
Mr. Hoban: I had not realised how much discussion could be had about a single new clause until the hon. Member for Wolverhampton, South-West (Rob Marris) walked into the Chamber.
The advantage of new clause 2 is that even if the Treasury agreed to have only one review, at least there would be a mechanism for ensuring that we could have a debate, whereas under new clause 3 if the Treasury decides on a whim not to have more than one review, there is no formal mechanism for this House to challenge the Government on that decision.
Mr. Browne: This conversation is getting more and more arcane. I conceded in my opening remarks that although on the face of it the Bill is quite straightforward, it has a few unusual features. We are navigating waters that have not previously been explored in this country, although similar schemes exist in other countries. There is therefore merit in having a review. Having said that, I think there is merit in periodically reviewing every piece of legislation that the Government introduce to see whether it has had the intended effect.
In new clause 3, the Government make the useful concession of allowing a formal review. I do not want to be mean-spirited, because they have moved on this: they have listened to the concerns that have been expressed and, in a healthily non-partisan manner, sought within the bounds of what they regard as practicable to bring forward proposals that can command broad support. The Opposition parties may wish the Government to commit to further reviews, which would be desirable, but I can see why they would be reluctant to support the rather loosely drafted new clause 2.
Rob Marris: What are you going to do?
Mr. Browne: I do not anticipate the Conservatives pressing new clause 2 to a Division. On the basis that it contains the broad principle of having more than a single review, I would be willing to support the Conservatives, but I suspect that the Government would use their majority to vote down that proposal on the basis that they share my concerns about its loose wording.
Tom Levitt: It is a pleasure to follow the hon. Member for Taunton (Mr. Browne), from whom I learned—I had not realised this before—that the Liberal Democrat party is in a position to make concessions. However, I will put that aside for the moment.
As chair of the all-party group on the community and voluntary sector, and one to whom the sector has been talking loudly on this issue, I very much appreciate the spirit in which my hon. Friend the Minister has
tabled this amendment, as he promised that he would following our debate in Committee. He has been as good as his word. I will, if necessary, follow him into the Lobby to support new clause 3.
My hon. Friend the Member for Clwyd, South (Mr. Jones) and I were part of the awkward squad on the Back Benches in Committee— [ Interruption. ] I hear gasps of astonishment from my colleagues. As such, let me make one or two other statements about the new clause. I hope that my hon. Friend the Minister is right about the intention to pursue a voluntary scheme. I am much consoled and helped by his saying in response to my intervention that legislation to address a failing scheme could well be considered at a later date. I hope that that is not necessary. Although he did not say so, I suspect that he is of the opinion that inserting too many get-out clauses may undermine the voluntary scheme, and we certainly do not want to do that. We will have a voluntary scheme as a result of the legislation, and we all want it to work in the interests of the beneficiaries, and of the good standing of the banks.
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It is important to have a review. My hon. Friend the Minister was right to vote against the amendment passed in another place when it came to Committee, and I believe that new clause 3 is an important clarification of the position. It is a review process far superior to the one in the Bill when it first came to Committee. It does not rule out a subsequent review; it cannot do so. All Ministers must, at any time, be able to revisit previous legislation to check that it is working. Those of us who wanted an assurance about voluntary, as opposed to compulsory, status may be superficially attracted to new clause 2(5)(b), which suggests legislation might be introduced. In fact, that provision is meaningless. If legislation is necessary to put right something that is wrong with the scheme following the review, new clause 2 would not provide a quicker or more efficient way of achieving it; it simply says that it might be necessary. The Minister has conceded that it might, at some point, be necessary. New clause 2 is superficial and has been tabled for the sake of it, to allow a debate to take place.
Taking all those points into account, and in the spirit of what my right hon. Friend the Member for Leicester, East (Keith Vaz) described as the civilised way we dealt with matters in Committee, and in the spirit of the brevity of those proceedings, I support new clause 3.
Mr. Charles Walker (Broxbourne) (Con): I too served on the Committee, and it was an extremely enjoyable experience. The sittings were very good natured, and if all Committees were like that, this place would be far happier and more productive.
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