At its meeting on 14 March 2018 the Committee scrutinised a number of Instruments in accordance with Standing Orders. It was agreed that the special attention of both Houses should be drawn to one of those considered. The Instrument and the ground for reporting it is given below. The relevant Departmental memorandum is published as an appendix to this report.
1.1The Committee draws the special attention of both Houses to these Regulations on the ground that they have been made using the inappropriate parliamentary procedure.
1.2These Regulations were made by the Treasury under section 2(2) of the European Communities Act 1972, and are subject to annulment by resolution of either House. An instrument under that power may be made using either that procedure or by means of a draft requiring approval by a resolution of each House. The Regulations contain a provision which could have been made under section 22(1A) of the Financial Services and Markets Act 2000, if amended in the same way as has been achieved by another provision of these Regulations; if the provision had been made using that power, it would have been subject to the affirmative resolution procedure.
1.3In the Committee’s opinion, where section 2(2) is used to do something which could have been done under another power, and that other power would have required affirmative resolution, as a general rule the section 2(2) instrument should also be made by affirmative resolution. It appears from the Explanatory Memorandum to these Regulations that the Treasury agrees with the Committee’s view, but considered that the need to bring the Regulations into force without further delay outweighed the desirability of applying the affirmative resolution procedure. The Committee therefore asked the Treasury why the instrument had not been prepared sooner so as to allow sufficient time for the affirmative resolution procedure. In a memorandum printed as an Appendix, the Treasury states that, although drafting began in March 2017, it proved more complex and time-consuming than had been anticipated; and the issue of parliamentary procedure was not appreciated until January 2018.
1.4The Committee understands how this situation has arisen on this occasion, but thinks it right to record that the result is a departure from an important principle of respecting the thresholds for affirmative resolution set by Parliament, and not appearing to use section 2(2) to avoid the need for affirmative scrutiny. The Committee accordingly reports these Regulations for having been made using the inappropriate parliamentary procedure.
Published: 16 March 2018