Clause
62Offences
under subordinate
legislation Question
proposed, That the clause stand part of the
Bill.
Mr.
McFadden: The clause extends the existing powers of the
Minister to create criminal offences in secondary legislation under the
powers to create alternative civil sanctions in this part of the Bill.
It is important that clause 62 is read alongside the list of enactments
in schedule 7. Subsection (4) limits the scope of the clause to the
secondary legislation that can be made under the list of enactments in
schedule 7. That means, for example, that a Minister creating, amending
or consolidating criminal offences in secondary legislation made under
one of those listed enactments may also provide for the offence to be
sanctioned using the fixed monetary
penalty. 10
am Taken
with clauses 36 to 38, and schedules 5 and 6, the clause will ensure
that all relevant offences, whether created in primary or secondary
legislation, can be dealt with through a civil sanction. That is
important because it helps to ensure consistency across a particular
regulatory regime.
The clause
allows Ministers to confer only those powers in part 3. All the
substantive restrictions will apply when the extended powers are
used—for example, in relation to devolution.
Before making
an order, the Minister must be satisfied that a regulator will exercise
the powers in a manner that is in line with the principles of good
regulation—the Committee will probably not want me to list them
again. That is provided for in clause 66, to which we will come
shortly.
Clause 62(3)
provides that any order made under an enactment in schedule 7 giving
the regulator access to the new civil sanctions will be subject to the
affirmative procedure. That matches the parliamentary procedure for
orders made under clause 36.
The clause is
intended to ensure that the option that we are creating to use civil
sanctions is available across primary and secondary legislation and
across the regulatory
regime. Question
put and agreed to.
Clause 62
ordered to stand part of the
Bill. Schedule
7 agreed to.
Clause
63Guidance
as to use of civil
sanctions Question
proposed, That the clause stand part of the
Bill.
Mr.
McFadden: The clause is about guidance, and again the
provisions are important. We are significantly changing the range of
options available to regulators and the use of civil sanctions, and it
is important that there is proper guidance on that.
The clause
says that where the power to impose a civil sanction is conferred on a
regulator
“the provision
conferring the power must secure the results in subsection
(2).” That
means that the regulator must publish guidance about its use of the
sanction, that the guidance must contain the relevant information and
that the regulator must revise it where appropriate, consult such
persons as the provision may specify and have regard to the guidance or
revised guidance in exercising its function.
On what we
might call the penalty guidance, subsections (3) to (5) set out the
specific requirements that the guidance must meet in relation to fixed
penalties, discretionary requirements and stop notices. For example,
regulators will be required to include details of how the penalties
will be imposed and of those matters likely to be taken into
consideration in determining the level of a variable monetary
penalty.
We have
talked about the powers and the need for consultation in putting
together an order to confer them, but guidance on how those powers are
to operate in practice is an equally important part of the regime, and
that is covered in clause 63.
Mr.
Prisk: As the Minister said, clauses 63 and 64—I am
looking principally at clause 63—refer to what should be in the
guidance. I have two brief questions for the Minister. First, when
would the guidance be published? It is always important for businesses
to understand that. Secondly, how is it to be made accessible to
affected persons? The provisions will affect a wide section of the
business community, so it is important to understand how the Government
intend to ensure that business is properly informed in a timely
way.
Mr.
McFadden: The answer to the hon. Gentleman’s
question about when the guidance will be published is that we have
codes on such things. Our intention would be to publish guidance 12
weeks before the proposals came into effect. That should give people
adequate warning of what is
involved. More
generally, the hon. Gentleman is right to say that guidance is
important. Sometimes businesses pay outside consultants to help them to
comply with regulation or a change introduced by the Government.
Obviously, we recognise that that happens, but we do not want
businesses to do it unless they have to, so we put significant effort
into improving
guidance. Let
me give an example. The Government have put significant effort into
improving the “Employing people” pages of the Business
Link website. They are a very good guide for businesses so that they do
not have to spend what are sometimes significant sums asking people how
they should comply with the law when that information could be made
available for free and, we hope, in an accessible and user-friendly way
by the Government. The hon. Gentleman is therefore right to stress the
importance of guidance, and we do put effort into improving it. We
envisage such guidance being available on a regulator’s website,
so that a business in that field
could check what was expected of it. That is right and fair, and that is
what we hope that regulators would do under this
provision. Question
put and agreed
to. Clause
63 ordered to stand part of the
Bill. Clause
64 ordered to stand part of the
Bill.
Clause
65Publication
of enforcement
action Question
proposed, That the clause stand part of the
Bill. Mr.
David Kidney (Stafford) (Lab): It is a pleasure to serve
under your firm but fair direction of our proceedings, Mr.
Chope. I have some questions for my hon. Friend the Minister. The
clause relates to the publication of information on enforcement action
in respect of the new civil sanctions. What is the purpose behind the
clause? It strikes me that it is one of two things. One possible
explanation is that it constitutes a name-and-shame policy for people
on whom civil sanctions are imposed. The second explanation is that it
is about accountability: people who impose the new civil sanctions have
to account for how many they have imposed and whether they are
collecting moneys efficiently, so that there is information on which
the public can judge them. To me, the second explanation is far more
satisfactory. The
reason why I thought that the first explanation might apply is that
this morning I woke up to the news that from today the Border and
Immigration Agency will, under a naming-and-shaming policy, publish the
names of employers who employ illegal immigrants. It therefore occurred
to me that the Minister might say that that is his purpose in this
case. The
important point about the second purpose—collecting the
information and knowing whether the system is effective—is that
under subsection (2) some information has to be published, but it is
partial. The information that a civil sanction has been imposed should
be collected, but not necessarily the information that the matter has
come to a successful conclusion. Under subsection (2)(b), for some of
the fixed monetary penalty cases, it will be reported that the
penalties have been paid, but that will not necessarily happen for all
of them. That is my reading of the provision. It is therefore possible
that we would never know the true extent of the power and whether it
was successful. I conclude that we might never know its effectiveness
if we were thinking back to the time when magistrates courts were
imposing many fines but apparently not collecting them successfully.
The collection rate was appalling. That fact would be very important
for public interest in whether the sanctions were any use. However,
because of the way in which the clause is drawn, I do not think that we
would have that
information. The
provision also seems incomplete because of subsection (3), which states
that if there is a successful appeal against a civil sanction, that
information does not have to be collected and reported. If one is
asking about the effectiveness of the overall system, one has to ask
why that is, because it is a relevant fact that in many
cases there would be a successful appeal against the civil sanction. We
would want to know that fact, and it should be published, because it
would lead to questions being asked about the alacrity with which civil
sanctions were being imposed but overturned on appeal. It would be
important to have that information; it should not be
excluded. Subsection
(4) is the most worrying of all. It says that the information need not
be collected and
published “where
the relevant authority considers that it would be inappropriate to do
so.”
That sounds as though a
local authority, as a regulator, could decide not to collect
information because it was inappropriate to do so or to collect some
information about some cases but not others, which would lead to an
undermining of the use of the statistical evidence. That seems to hole
the entire clause below the waterline. I looked at the explanatory
notes for guidance, but found that they muddied the waters even further
instead of solving the problem.
Paragraph 170
reminds us that the reports may not need to list certain cases.
“Certain cases” suggest that it is one or two and not the
whole lot, but the clause is so broadly drawn that the regulator could
decide that all the cases were inappropriate to be publicised. The
clause says that cases need not be
listed “where
the Minister thinks it inappropriate for such cases to be publicised,
for example, for data protection
reasons.” If
I am right and the purpose is to compile statistical information, data
protection would not apply because we would not be disclosing
information about individual cases.
Why do the
explanatory notes mention the Minister? The Bill says that the
“relevant authority” makes the decision. Either the Bill
or the explanatory notes is wrong. The Minister needs to tell us the
purpose of the clause—he was about to rise to do so before I
interrupted him, so I apologise for that—and whether he is
satisfied that the Bill has been drawn sufficiently carefully on this
occasion.
Mr.
McFadden: I am extremely grateful to my hon. Friend for
asking me that series of questions, which will allow me to elucidate on
the rationale behind the clause. Hopefully, I can give him some
answers. He asked several questions, including whether the purpose of
the clause was accountability or letting the public know who had
contravened. It is a bit of both. It is right that regulators, who are
being given a significant new sweep of powers under this part of the
Bill, publish information about how they are exercising those powers.
That is a good in itself. As to naming and shaming, there can also be a
public interest in knowing whether an organisation has contravened and
has reached the end of the process. We can go back to the example of a
business releasing toxic waste into the environment. I do not know why
the public should not know about a business that has been found guilty
of such an offence, has received a civil sanction—it may have
appealed but has not been successful—and has reached the end of
the process.
My hon.
Friend then asked, why exempt those on appeal? That issue has arisen in
other Bills as well. Is it in the public interest to know when charges
have been levied but the person has not been found guilty in the end?
There is a reputational issue at stake for business.
We have talked about appeal processes in the context of the Bill. The
regulator may impose a civil penalty, but the penalty gets overturned
on appeal because the regulator was wrong. In those circumstances, is
it fair for the business to be named in the report? In the end, when
the process has been completed, the business has not been found guilty
of anything. Therefore, subsection (3) is
fair. Mr.
Kidney: I guessed that my hon. Friend might say that it
was a bit of both, but does he not think that that is confusing? If
there were lots of civil sanctions being imposed and they were all
being overturned on appeal, there would be a cause for public concern.
If the Bill exempts publication of information about cases because they
were successfully appealed, we would not know about that
concern.
Mr.
McFadden: My concern is with reputational fairness for the
business. I do not think that saying that it is a bit of both is a bad
thing. There is a perfectly fair dual purpose to publishing
information. It will show those looking at the regulator how the
regulator is using the new suite of powers, and it will serve the
public interest to know about those who have contravened the
regulations. That can be fair, provided it has reached the end of the
process. 10.15
am The
point that my hon. Friend is making is, in a sense, a generic one. It
has been raised in other situations. My Department has sometimes been
asked, “Shouldn’t those accused of something be named on
some list, even if it isn’t proven?” I am not sure that
that is fair. Subsection (3) is intended to deal with that
situation.
My hon.
Friend’s final question concerns subsection (4) and
the
phrase, “where
the relevant authority considers that it would be inappropriate to do
so”. I
should make it clear that the relevant authority and the Minister are
the same thing under that provision. The relevant authority will not be
the regulator. Subsection (4) will allow the Minister to exempt certain
cases from the publicity requirement, and is intended to capture cases
that may have data protection implications or other grounds for
exemption.
I must be
careful how I put that. What other grounds might there be for exemption
from the requirement to publish information about enforcement action?
The regulated person or business may be in a particularly sensitive
area. It may be that if information about the address of the premises
came into the public domain, it could be a danger to those working
there. I know that we can think of examples where that might be the
case. There are some among the population who object fiercely to some
business activities, research activities and so on, so it is prudent to
give the Minister the power to say in those circumstances, “We
don’t want that information released, because we could be
putting someone at risk by publishing
it.”
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