Previous Section Back to Table of Contents Lords Hansard Home Page

Lord Judd moved Amendment No. 2:

Page 2, line 6, at end insert:
("( ) No order shall be made under this section unless such an order has been laid before and approved by a resolution of both Houses of Parliament.").

The noble Lord said: My Lords, the Scrutiny Committee of this House, for which we all have tremendous respect, recommended that orders issued under the Bill should be subject to a greater degree of parliamentary scrutiny than the Government have proposed. In Committee it was rightly pointed out by the noble Lord, Lord Elton, and the Minister that those recommendations applied to matters other than the transfer of ownership to a proposed foundation. That is why in our earlier amendment we on this side of the House sought to extend the principle of parliamentary scrutiny to the actual transfer.

We return now to the question of parliamentary scrutiny of the initial transfer from the existing Crown Agents Corporation to the successor company to be nominated by the Secretary of State. The noble and learned Lord, Lord Simon of Glaisdale, has been kind enough to keep me informed of his correspondence with the Minister about the scrutiny of delegated legislation, and the Minister has been equally considerate. The outcome, as noble Lords will no doubt gather, is that the Government have been prepared to concede not a whit more scrutiny and accountability than they proposed initially. I therefore feel that it is right to offer the House the option of a level of scrutiny greater than that recommended by the Scrutiny Committee, since the very moderate proposals of the Scrutiny Committee and the noble and learned Lord, Lord Simon of Glaisdale, have clearly fallen on deaf ears.

The appointment of a day for winding up of the Crown Agents and the nomination of a successor company remain the most substantial measures included in the Bill. In the absence of any other substantial proposals, it is entirely appropriate that those steps should not be taken without further examination in Parliament. We have taken the precaution of establishing the practical implications of subjecting those steps to the two forms of scrutiny available to us. The Scrutiny Committee felt that the negative resolution procedure would be sufficient for the terms of transfer

24 Apr 1995 : Column 768

of ownership to the successor company. In view of the Government's refusal to make any concessions to the calls for more transparency, that no longer seems to us sufficient.

In the parliamentary Session 1993-94, 1,221 statutory instruments, excluding draft statutory instruments subject to annulment, were tabled; 143 were prayed against; but only one was debated on the Floor of the other place. The last time such an order was annulled after debate was on 24th October, 1979. Therefore the negative resolution procedure results in debate on only a tiny fraction of the orders in question which are tabled, and even of the orders which are prayed against. The reality is that the chances of a measure subject to annulment being considered properly are infinitesimally small, whereas, of course, any measure requiring affirmative resolution is guaranteed consideration. I am sure noble Lords will agree that the importance of this matter is great enough even to require ministerial attendance in Parliament on a Friday afternoon.

Noble Lords will therefore understand that we on this side would be happy to support changes to the Bill along the lines recommended by the Scrutiny Committee, but we believe that Parliament should go a step further and insist on real accountability in the transfer of ownership of Crown Agents at each important stage. We therefore recommend the amendment to the House.

Perhaps I may speak briefly to Amendments Nos. 6 and 7 at the same time. I draw the attention of noble Lords to the fact that in Committee the Minister said that if it were felt necessary to have a golden share, that would be in the foundation, and that the foundation is not covered by the Bill. We have therefore brought forward these amendments in order to help the Minister find a formula for a golden share, which can apply to both the successor company and the ultimate new owner in the proposed foundation. Since the only golden share that appears to work is a majority share, that is what we have suggested in the first instance, with provision for a reduced shareholding with the consent of Parliament.

The Minister told the Committee that she would look again at the question of the intended powers to be reserved to the Secretary of State. I hope that she will now be able to tell us more. She has talked of keeping the foundation in line with its declared objectives for a period of perhaps five years. We need to know how that is to be done. We need also to know what would happen if the successor company found itself in commercial difficulty within that time. Would Ministers be prepared to see it go to the wall, or would they intervene? A golden share would allow a fairly straightforward answer to such questions. If the Minister regards such a provision as a deplorable example of the nanny state, I would in all sincerity ask her what she proposes instead.

Lord Redesdale: My Lords, I support the amendments. We covered them exhaustively in Committee. It is sad that the noble and learned Lord, Lord Simon of Glaisdale, is not here to debate them once again. It is always an interesting exchange. I realise that the affirmative and negative resolution proposals in the Bill go no further than the transfer. However, as the Minister said on Second Reading, the Secretary of State has reserved powers to enable him to ensure that no

24 Apr 1995 : Column 769

change can be made to the fundamental purpose. Would it not be appropriate that Parliament too should be given that power, as we have not yet had a clear indication of the detailed form of the foundation, so that we could object to the foundation once it is set up?

Baroness Elles: My Lords, I wish to comment on the contributions of the noble Lords, Lord Judd and Lord Redesdale, in trying to improve this difficult Bill. The third report of the Delegated Powers Scrutiny Committee stated that it could be possible to subject to negative rather than affirmative procedure matters that have not been spelt out in the Bill.

The Minister made it clear that there will be a foundation and named a considerable number of the considerations that will be attached to it. However, she also made it clear that not all the considerations that will attach to the foundation and to a successor company have been crystallised. I understand that she is not in a position to make the matter crystal clear on all counts, including charitable status.

I support the Minister and express my gratitude for what she has said about the foundation. I suggest that if when the Bill goes to another place certain issues have still not been covered it might be appropriate to table an amendment proposing a negative procedure because some powers may be allotted to the Secretary of State that will not have been referred to during the course of the Bill. I hope that the noble Lord, Lord Judd, will withdraw the amendment and leave the matter to a later stage of the Bill when perhaps more information will be produced by the Government.

7.15 p.m.

Baroness Chalker of Wallasey: My Lords, it is important to understand that the purpose and effect of Amendment No. 2 is to subject to the affirmative resolution procedure the orders appointing a day for the vesting of Crown Agents in the successor company under Clause 1(1) and nominating the successor company under Clause 1(2). I make that point because the matter discussed by the noble and learned Lord, Lord Simon of Glaisdale, and I and the point made in the correspondence which we both copied to the noble Lords, Lord Judd and Lord Redesdale, dealt with the order-making power in Clause 13(3). They are slightly different. I do not wish to muddle your Lordships, or to get into a muddle myself, by dealing with the matter at this moment because Amendment No. 2 does not apply in the same way. I shall concentrate on the general remarks made by the noble Lords, Lord Judd and Lord Redesdale, and by my noble friend Lady Elles. There is a difference, however legally subtle it may be.

I understand the desire to allow Parliament to look at the details of the proposals for transfer. That is what the noble Lord's amendment is all about. In Committee, I explained why an affirmative resolution procedure would be inappropriate. I know that the noble Lord, Lord Judd, does not agree with me on this matter but we considered the issue in some detail during that debate. I said—and I repeat it as a matter of consistency—that it would be unprecedented to act in this way. Enabling

24 Apr 1995 : Column 770

legislation is the normal way of proceeding, accepted by your Lordships' House and another place on every previous occasion, of which there have now been many, when there is a transfer from the public sector to the private sector.

In this short debate I have heard no convincing explanation of why an exception should be made in the case of Crown Agents. I am more concerned that the practical effect of introducing the affirmative resolution procedure could be damaging to the commercial interests of Crown Agents. During previous stages of the Bill I have made it abundantly clear—and I do so again now—that I will have nothing to do with anything that will damage the commercial interest or the future of Crown Agents.

We are dealing with the privatisation of a public corporation. Such things always involve complex and commercially confidential negotiations. That is why I repeat that details could not be disclosed in the way that the noble Lord has suggested. I also believe that the inevitable delay caused by the need to obtain parliamentary approval could sow seeds of doubt and uncertainty about the Government's plans or the timing of the transfer, which would adversely affect Crown Agents.

When talking about the negative procedure, which is now before us in Amendment No. 2, the noble Lord, Lord Judd, spoke of the few occasions when in another place an order is debated on the Floor of the House. He gave that as his reasoning for opting for an affirmative order. I too am well aware of the delays that take place in another place, even to debate affirmative orders. That underlines the anxiety I would have were the House to agree to the noble Lord's Amendment No. 2; that is, the delays that would be built in.

The Government's intentions should not be in doubt. On many occasions we have announced that we intend to transfer Crown Agents to an independent foundation and that that is the way forward. We have also said that we will provide as much information as possible, as soon as possible and before the transfer is completed. That is why I am determined to get on with the work that has already started on the memorandum and articles of the foundation and will make them available to Parliament. An information memorandum will be prepared for prospective foundation members and that will be made available to your Lordships and to Members of another place.

The noble Lord, Lord Judd, also asked me what would happen if the Crown Agents' business should fail. Perish the thought—it is not going to fail! He asked me whether the Government would bail it out. Perhaps I may say, first, that the Crown Agents has some 150 international clients, including my department, and provides a wide range of services. I see no reason why we should not have every confidence that the Crown Agents' foundation will have a bright future. But, as we all know, there is no guarantee of success in life in anything. That is why the management of the foundation will be the responsibility of its members and the board, who will be chosen for their experience and expertise.

24 Apr 1995 : Column 771

I believe that the noble Lord is wrong to talk about bailing out a privatised Crown Agents. The members of the board of the Crown Agents' foundation have to be fully responsible for ensuring the viability of the business after transfer. It would be quite wrong to expect taxpayers to bail out something which was mismanaged. I do not see that there is any risk but it is worth saying that I do not believe that it should be a responsibility for the Government and thereby for the taxpayers.

When the noble Lord proposed the amendment he talked about obtaining a clearer picture of the details of the proposed transfer. I give him an undertaking that I will prepare a paper for your Lordships and for presentation to the House of Commons Select Committee on Foreign Affairs so that there will be an opportunity to have a clear view of the proposals before the proposed transfer takes place. But beyond that I cannot go. The arguments that were used in Committee still stand and I can see no reason for proceeding with this amendment. I hope that the noble Lord will withdraw it.

Next Section Back to Table of Contents Lords Hansard Home Page