Regulatory Enforcement and Sanctions Bill [Lords]

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The Committee consisted of the following Members:

Chairmen: † Mr. Christopher Chope, Mr. Eric Martlew

† Baron, Mr. John (Billericay) (Con)

† Burt, Lorely (Solihull) (LD)

† Dorries, Mrs. Nadine (Mid-Bedfordshire) (Con)

† Drew, Mr. David (Stroud) (Lab/Co-op)

† Kidney, Mr. David (Stafford) (Lab)

† Lilley, Mr. Peter (Hitchin and Harpenden) (Con)

† McCarthy-Fry, Sarah (Portsmouth, North) (Lab/Co-op)

† McFadden, Mr. Pat (Minister for Employment Relations and Postal Affairs)

† McGovern, Mr. Jim (Dundee, West) (Lab)

† McKechin, Ann (Glasgow, North) (Lab)

† Main, Anne (St. Albans) (Con)

† Mallaber, Judy (Amber Valley) (Lab)

† Prisk, Mr. Mark (Hertford and Stortford) (Con)

† Prosser, Gwyn (Dover) (Lab)

† Seabeck, Alison (Plymouth, Devonport) (Lab)

Teather, Sarah (Brent, East) (LD)

Celia Blacklock, Chris Shaw, Committee Clerks

† attended the Committee

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Public Bill Committee

Tuesday 17 June 2008

(Morning)

[Mr. Christopher Chope in the Chair]

Regulatory Enforcement and Sanctions Bill [Lords]

10.30 am

The Chairman: Before we begin, I have a few announcements to make. The hon. Member for Stafford has asked me informally whether people may remove their jackets, should they so wish. That is certainly all right by me. Will hon. Members ensure that their mobile phones and pagers are turned off or switched to silent during our proceedings?

Copies of the money resolution connected with the Bill are available in the room. I remind hon. Members that adequate notice should be given of amendments. As a general rule, I and my fellow Chairman do not intend to call starred amendments, nor do we intend to call amendments that are not signed by members of the Committee because we presume that they would not be moved.

I remind hon. Members about the procedure at the start of today’s sitting. The Committee will be asked first to consider the programme motion on the amendment paper for which debate is limited to half an hour. We shall then proceed to a motion to report written evidence before starting clause-by-clause scrutiny.

The Minister for Employment Relations and Postal Affairs (Mr. Pat McFadden): I beg to move,

That—

(1) the Committee shall (in addition to its first meeting at 10.30 a.m. on Tuesday 17th June) meet—

(a) at 4.00 p.m. on Tuesday 17th June;

(b) at 9.00 a.m. and 1.00 p.m. on Thursday 19th June;

(c) at 11.00 a.m. and 4.00 p.m. on Tuesday 24th June;

(d) at 9.00 a.m. and 2.00 p.m. on Thursday 26th June;

(e) at 10.30 a.m. and 4.00 p.m. on Tuesday 1st July;

(2) the proceedings shall be taken in the following order: Clause 1; Schedule 1; Clause 2; Schedule 2; Clauses 3 and 4; Schedule 3; Clauses 5 to 28; Schedule 4; Clauses 29 to 37; Schedules 5 and 6; Clauses 38 to 62; Schedule 7; Clauses 63 to 77; new Clauses; new Schedules; remaining proceedings on the Bill;

(3) the proceedings shall (so far as not previously concluded) be brought to a conclusion at 7.00 p.m. on Tuesday 1st July.

I welcome you to the Chair, Mr. Chope. I am sure that I say on behalf of the whole Committee how very much we are looking forward to your guidance in our deliberations. When I first glanced at the membership of the Committee and saw your name beside a little passport-sized photograph, I thought we would be in for a long, hot summer—we might still be. I then realised that you were in the Chair, which I thought was a bit like Barcelona having Ronaldinho as the referee rather than leading the attack.

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I thank all those who have been involved in the Bill’s deliberations so far. We have had extensive consultation with businesses, regulators and those in many local authorities—all of whom have contributed extensively, for which we are grateful. The Bill was also subject to extensive and constructive debate in the other place and it comes to us improved by the work of colleagues there. It will change how we enforce regulations throughout the country, and it will create an expert body for the improvement of regulations at local level. It will create a framework for a more targeted and proportionate sanctioning of non-compliance with regulation, and it will assist in the reduction of the imposition of unnecessary burdens by our regulator. I am sure that we shall debate all such matters in significant detail over the coming weeks, and I look forward to those deliberations.

Mr. Mark Prisk (Hertford and Stortford) (Con): I add my welcome to you, Mr. Chope. I know that you will provide us with firm and fair guidance from the Chair as we consider the matters before us. I also welcome the Minister. I am sure that we shall have a positive dialogue, and I hope that we can provide him with some relief from the endless debates on post office closures that have, I suspect, been a darker period for him. I hope we can provide him with a little relief from that in our social responsibility role on the Conservative Benches. I welcome the fact that no knives or guillotines are contained in the programme motion and I know that as a staunch parliamentarian, Mr. Chope, you will welcome the fact that there are no such limits on our ability to consider the matters in their full. That is important because sometimes Labour Members take a heavy-handed approach, which can limit our ability to explore the unintended consequences of such issues.

As the Minister said, the Bill began in the other place and, to use his words, it has been improved. The Government have been forced to accept more than 12 major concessions, and I put on the record my sincere congratulations to all the Members of the other place who participated in that process, particularly my Conservative colleagues who engaged actively in that scrutiny and did their job extremely well. However, there remain some worries and the Minister referred to one or two of them, which is why the programme motion is important.

There are concerns about the powers and scope of the Bill, about accountability, about the potential for injustice in what might be seen as a parking fine approach to regulation in part 3 and about whether the Bill can achieve what Ministers are promising. However, given the concessions already made in another place, my aim in the debate is to be precise in my scrutiny and concise in my remarks, so I have no intention or wish to oppose the motion.

Lorely Burt (Solihull) (LD): Last but not least, I welcome you to the Chair this morning, Mr. Chope. I add my thanks to the bodies that so kindly advised our team, including the CBI, the Local Authorities Co-ordinators of Regulatory Services and the British Retail Consortium; they have helped us tremendously in understanding some of the practical implications of the Bill. As my Conservative colleague said, the Bill has been much improved in the Lords. The contribution of my colleagues in the Lords has been a valuable help in

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making the Bill stronger, so that it will balance the needs of business with the local requirements of enforcers on the ground—at the coal face—and the practical requirements with the needs of local democracy.

I am looking forward to a concise debate on the outstanding issues that we have to discuss. The Liberal Democrats have tabled only a small number of amendments and we look forward to taking the debate forward in a spirit of constructive criticism.

Question put and agreed to.

Ordered,

That, subject to the discretion of the Chairman, any written evidence received by the Committee shall be reported to the House for publication.—[Mr. McFadden.]

The Chairman: Copies of any memorandums that the Committee receives will be made available in the Committee Room. We now proceed to clause-by-clause scrutiny.

Clause 1

LBRO

Question proposed, That the clause stand part of the Bill.

Mr. McFadden: The clause is a simple one, establishing the Local Better Regulation Office as a corporate body. There are a number of amendments tabled to the accompanying schedule 1, which sets out in detail how LBRO is intended to be established in statute. I shall reserve my main comments for those amendments, which attempt to alter in various ways the establishment of LBRO. The central part of the Bill is to establish the body, to carry out a number of functions to do with better regulation—advice to local authorities and central Government and adjudicating in certain ways between primary and enforcing authorities around the country. The clause is one of the central building blocks of the Bill, establishing LBRO to further the better regulation agenda at local level.

Mr. Prisk: I am grateful to the Minister for those brief but helpful opening remarks. He said that the clause is short, but equally—in his words—it is essential. It establishes the Local Better Regulation Office, which we will perhaps shorten to LBRO with your permission, Mr Chope. The provision follows from the Hampton review, which looked at the whole way in which risk-based regulation should proceed. It is, in essence, the Government response to the need for raising quality and improving the narrowing wide variance in how local authority regulatory services operate.

We are looking at not just trading standards, but environmental health and matters such as licensing. There are several concerns, not least the fact that we are being asked to believe that a single organisation—a reasonably small organisation—will be able to deliver a significant change in regulatory practice for nearly 500 different local authorities. Effecting the kind of improvements that Ministers seek, especially for the worst regulators, would need, in my view and the view of many of those involved, a considerable change in the internal management, training and culture of those organisations. We are being asked to agree to a small

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organisation taking on what is a very significant task. My question to the Minister, therefore, is how will the LBRO deliver that change to so many different organisations?

The Chairman: Does the Minister wish to respond?

Mr. McFadden indicated dissent.

The Chairman: It is not compulsory. If the Minister does not rise I presume that he will not be responding and we shall move on.

Mr. Prisk: I was rather anticipating that as a question was asked from the Opposition Benches, the Minister might provide an answer. I hope that he will be able to do so.

Mr. McFadden: I am happy to elucidate further upon LBRO and how it will do its job. The hon. Gentleman is absolutely right to root the discussion in the Hampton report, which was carried out three years ago. Hampton identified two basic problems in local better regulation. The first was inconsistency. Different advice was being given to businesses operating around the country; a business might get a green light in one local authority area, but a red light in another. Hampton found that to be costly and cumbersome to business. The second major flaw he identified was inflexibility in how regulation was enforced, particularly in the penalty regime. That applies more to part 3 than to clause 1, but those were the two issues that Hampton identified.

Our response is to establish the Local Better Regulation Office. The hon. Gentleman is right: local authority regulators sit at the centre of a complex system. His question is: how will a small organisation deal with the two quite major issues that Hampton identified? The first thing that I point him to is the board of LBRO. The LBRO has already been established as a company and a board has been appointed, and I hope he agrees that the board represents significant expertise from local authority, trading standards and business backgrounds. That expertise will be of significant help in enabling the LBRO to deliver its aims.

The LBRO will work closely with national regulators, local authorities and businesses, seeking their assistance and co-operation in delivering better regulation. It has a relatively small budget of about £4.5 million a year, but part of that will enable it to provide a level of financial support and assistance to local authorities in carrying out those functions. The hon. Gentleman is right to say that it is a relatively small organisation, but it will occupy a pivotal role at the centre of a complex system of regulation. The expertise of the board and the work it will do with all the different players—regulators, local authorities and businesses—will enable LBRO to carry out the job that we hope it will do.

Mr. Prisk: I am grateful to the Minister for going into the background. What I am trying to tease out is a practical issue that I have a degree of scepticism about—the practical reality of a single, small organisation being able to effect cultural change in nearly 500 organisations. The Minister is a former special adviser to the former Prime Minister, Mr. Blair. I think the phrase used by

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Mr. Blair in those days was that he had the scars on his back from trying to effect change in Whitehall. The Minister will therefore be acutely aware of the difficulty in achieving the kind of change that I suspect he, most of business and I want to see. Does he recognise that it will be a significant challenge, and is he confident that the resources and powers in the Bill are sufficient?

10.45 am

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Prepared 18 June 2008