| Previous Section | Back to Table of Contents | Lords Hansard Home Page |
Legislative and Regulatory Reform Bill
6.36 pm
The Deputy Chairman of Committees (Lord Tordoff): I call Amendment No. 31.
Lord Goodhart: Before we get to AmendmentNo. 31, I would like to make a brief correction to a statement made by the noble Lord, Lord Waddington, in the debate on Amendment No. 30 when he suggested that I was taking a different line from that taken by my honourable friends in the House of Commons. I have since then checked on the debates and votes on Report in the House of Commons and I refer the noble Lord, Lord Waddington, to the House of Commons Hansard reports for 15 and 16 May. On 15 May, at col. 737, my honourable friend David Heath made what could be regarded as an ambiguous statement indicating possible support. However, I would refer the noble Lord to the speeches of Mr David Howarth at col. 751 andMr Heath again at col. 755, which confirm our opposition to an identical amendment. When we voted on it the following day, as is shown in cols. 945-48, we voted with the Government against the amendment in exactly the same way as we have done in your Lordships’ House today.
Lord Waddington: The last thing that I would wish is—
The Deputy Chairman of Committees: I wonder whether it would be helpful if we had a Motion before the Committee before any further debate takes place. It is clearly a matter for the Committee and not for me, but this exchange could continue in the course of a later amendment when we have a Motion being debated before the Committee. Therefore I would like to call the noble Baroness, Lady Wilcox, to move Amendment No. 31.
Lord Goodhart: I thought it would be convenient to dispose of this matter now. It may present slight technical difficulties. I am not for a moment suggesting that the noble Lord has done anything to his discredit at all, but it seems it would be helpful to get this out of the way, particularly as there are no other amendments which are at all similar to Amendment No. 30.
Lord Waddington: I wonder if I can take it that the noble Lord is speaking to this amendment. I am most grateful to him for having made his statement. The last thing that I would wish is to mislead the Committee in any way. Of course I accept that the line he has taken today corresponds with the line taken by his colleagues in the other place. I want to make it absolutely plain that I accept entirely what he has said. I would add only that I am most grateful for the support of two Liberal Democrat Peers in the Division Lobby a short time ago.
10 July 2006 : Column 529
The Deputy Chairman of Committees: Shall we then proceed to Amendment No. 31?
Lord Howard of Rising moved Amendment No. 31:
- (1) A Secretary of
State must publish annually a list of all regulations for which his
department is responsible which lay a burden on any activity, service,
body, voluntary group or business, and at the same time publish an
estimate of the total compliance cost of each such regulation and of
the average time taken by each person affected by the burden to comply
with each regulation.
- (2) The
Secretary of State shall have a duty to reduce by10 per cent
the number of regulations established under legislation for which his
department is responsible within two years of the coming into force of
this Act.
- (3) At the end of
the period of two years after the coming into force of this Act, the
Secretary of State shall lay a report before each House of Parliament
detailing his proposals to reduce by a further 10 per cent the number
of regulations established under legislation for which his department
is responsible and the timetable by which he expects to achieve that
target.”
The noble Lord said: I hope that your Lordships will forgive me if, by way of preface to this amendment, I refer to the remarks made by the Minister when this Bill was discussed in Committee a week ago. I return to this matter only as it is of such fundamental importance and because it bears on this amendment.
- “The
power to amend or revoke secondary legislation is less important, as
departments will always have a power to do this in any
event”.—[Official Report, 3/7/06; col.
119.]
The main argument against the Bill is the reluctance to give Ministers the power to bypass Parliament. But, how much deregulation is dependent on amending or repealing primary legislation? I should be grateful if the Minister could give some examples of the primary legislation that would be removed under these powers. There must surely be a long list of Acts or the Government would not have given so much time to this Bill. Can the Minister say what proportion of envisaged deregulation will be achieved through the repeal of primary legislation and what proportion of deregulation will be achieved through the repeal of secondary legislation, for which, as the Minister has told us, the Government already have powers?
If one of
the purposes of the Bill is to enable primary legislation to be amended
or removed without going through the normal legislative process, then,
clearly, there must be adequate protections to avoid the abuse of
power. I am still unable to see how adequate safeguards can be
introduced without losing that flexibility to repeal and amend
legislation, which
10 July 2006 : Column 530
The Minister has confirmed that power already exists to deregulate secondary legislation. Since that power is not being used, it is important that pressure is applied to Ministers to make effective use of both existing powers and the powers to deregulate that the Bill proposes to give them. There will always be other projects and initiatives that will be more attractive than the tedious job of getting rid of regulations. I refer your Lordships to the comment in the 20th report of the Delegated Powers and Regulatory Reform Committee, which stated that,
- “it is our
opinion that the block to regulatory reform is departmental priorities
rather than the “burden” test in the 2001
Act”.
The idea of creating a target for deregulation was strongly endorsed by the Better Regulation Task Force, which stated that target setting was,
- “a robust method
for the government to improve its control over the flow of new
regulation and a driver to reduce the burdens imposed by the stock of
existing
regulation”.
I refer again to the Better Regulation Task Force. It recommended the Dutch model of deregulation, which involved introducing a target for reducing administrative costs. The Netherlands chose a target of 25 per cent over four years, with some limited flexibility across different government targets. If the Dutch approach were used, as well as the benefit of increasing productivity and growth of business and a mechanism for increasing the efficiency of government, the task force estimated that an investment of £35 million would potentially increase gross domestic product by £16 billion. The report recommended that the Government set a target by May 2006 for reducing the administrative burden. The Government’s response was that targets would be set by the time of the Pre-Budget Report 2006. Can the Minister confirm that such targets will be forthcoming and that progress on the implementation of the recommendation is on course?
I understand that the Government accepted in full all the recommendations of the Less is More report so I am sure that the Minister will welcome the amendment. I beg to move.
6.45 pm
Viscount Bledisloe: I was somewhat confused when I read the amendment. Having heard the noble Lord move it, I am a great deal more confused. The amendment states:
10 July 2006 : Column 531
During last week’s debates, which, unfortunately, I could not attend, the Minister very much limited that to burdens imposed by regulators and so on. But that is not what the clause states and that is why it is so dangerous. A burden imposed by any legislation could be a burden imposed, for example, by a landlord and tenant Act which states that a landlord or tenant must repair this, that or the other, or by the Sale of Goods Act, which states that the seller must be responsible for the quality of the goods. Such burdens can be altered under Clause 1(2). You could make a regulation under Clause 1 that stated that, henceforward, landlords need not do any repairs and tenants must do them all; or that, henceforward, vendors need take no responsibility for goods and it would just be bad luck if you buy something that does not work.
Such burdens are imposed by virtually all legislation; so, if the Secretary of State were annually to have to publish a list of all the burdens imposed on individuals by any legislation in the country, he would merely be made to recite the entire statute book. On the other hand, if the noble Lord does mean regulations in the normal sense, I do not see why he is concerned only with burdens imposed by statutory instruments and the like, and not by burdens imposed by primary legislation. Some of those may need to be reduced, while some certainly do not need to be reduced at all. If the noble Lord is really including in the totality of the 10 per cent that is to be reduced all the obligations imposed on individuals under, say, landlord and tenant, sale of goods, employer, and safety at work legislation, trying to cut the statute book by 10 per cent every two years seems a somewhat ambitious target, even for those who are keenest on deregulation.
Lord Borrie: The quality and value of the speech that we have just heard makes me regret that the noble Viscount was not here on the first day of Committee. I suppose that the amendment is meant to be taken seriously but it is rather frivolous in its consequences. I suppose that it could be a probing amendment but I am not sure what it is probing. I do not think that having in a Bill a target of a 10 per cent reduction in the number of regulations established under legislation and so on is what Hampton or the Better Regulation Task Force, or whatever it is now called, had in mind at all. As the noble Viscount indicated, the duty would have astonishing consequences in a short period of time if a department had to comply with subsection (2).
10 July 2006 : Column 532
As for publishing a list of all regulations, the noble Viscount has already pointed out the ambiguity surrounding those regulations. Is the amendment referring to legislation in general, as is dealt with in Clause 1, including subordinate legislation? As for “burdens”, almost every conceivable piece of legislation can be described as a burden.
To be serious for a moment, surely we must accept that, whatever its faults, the Bill is concerned with continuing what was begun in 1994 when Her Majesty's Opposition were in government to reduce the burden of regulation on business and so on. One wants the Bill to be more effective than the previous one, from which arose a considerable spate of deregulatory orders, in order to reduce the burden that I have just described. Asking departments to publish lists of regulations seems to me to serve no useful purpose, and it is rather surprising that Her Majesty's Opposition should think that this is an amendment of value.
Viscount Eccles: I, too, am puzzled and confused, as the noble Lord, Lord Desai, was the other day. I was very interested in the contribution of the noble Viscount, Lord Bledisloe. I think that the confusion arises from the Government because, on the one hand, they say that they want to pursue better regulation. At one time that might have been “deregulation”, but that is a dangerous description and so they have shifted towards “better regulation”. On the other hand, they say that they have not been able to do that with the 2001 Act and nor could other governments do it with the 1994 Act. Then the Government say that they have opened a portal. We have heard about that several times. I think that it is run by the Better Regulation Executive, although I am not sure. It has made 330 proposals for deregulation, simplification, amendment and removal. These have included administrative recommendations as well as recommendations which I believe will almost exclusively concern secondary and not primary legislation.
This is where the confusion comes in. We find ourselves talking as though it will be impossible to follow the Government's programme if either the 2001 Act is not amended or this Bill is not enacted. I sincerely believe, and I am sure the Minister will put me right if I am wrong, that it will be possible to put in place by existing legislation a large percentage of any deregulatory, simplification or amendment programme—the departmental plans to which the noble Lord referred. The 1994 and 2001 Acts did not do much to achieve a reduction in the regulatory burden and nor will this Bill.
It is
probably a pity that we have chosen the word “burden”
because, as has been pointed out, a burden works both ways. To give one
example, there used to be a simplified employer’s deduction card
and a year-end return, which involved putting in one form. You now have
two submit three forms, which contain a great deal of information,
including whether your employee worked for a foreign company for 30
days in the year. That is completely irrelevant to complying with the
Revenue’s intentions. There are many other examples which come
from administration and secondary legislation. Unless and until the
Minister can clarify
10 July 2006 : Column 533
Lord Bassam of Brighton: I am drawn very much to the analysis to which the amendment has been subjected by my noble friend Lord Borrie and the noble Viscount, Lord Bledisloe. Of the three parts of the amendment, subsection (1) gives me most concern. We have been discussing burdens and the quantity of regulation that can impact on a business, a voluntary organisation and the public or private sectors and so on. When I read this part of the amendment, my heart sank because I had thought that noble Lords opposite were beginning to get to grips with what the Government are trying to achieve. Subsection (1) asks us to consider producing a list of all regulations—I am not sure whether it is secondary or primary legislation or both, or whether it is all legislation in the past or all future legislation—and,
- “at the same time publish an
estimate of the total compliance cost of each such regulation and of
the average time taken by each person affected by the
burden”,
Is that the sort of thing that we want to ask of civil servants who are tasked with the business of improving the quality of regulation—or deregulating, depending on which term you prefer? I say not. I cannot see the value in that exercise. I cannot see what it would do to hone and perfect the improvement of regulation or to reduce the burden of regulation within our legislative and statutory framework. I cannot see it working.
The noble Lord, Lord Howard of Rising, then goes on in the amendment to talk about target setting and about having robust methodology. We argue that we already have in place a robust examination of regulations. That is why we have a regulatory impact assessment and why departments are asked annually to go through their stock of regulations. I do not think that we need the prescriptive and bureaucratic approach which the noble Lord, Lord Howard, wishes on us in order to achieve that objective.
Regulations exist for good reason. They ensure that we protect citizens and provide a sensible framework within which our businesses, public services and voluntary organisations can operate. We want our public servants to use their finite resource to root out the unnecessary bureaucracy and to deal with it rather than investing more of their time in producing lists and writing more reports for Parliament, whether on an annual or a biennial basis, whichever approach is adopted.
7 pm
I
understand that the Opposition might have thought that this amendment
would achieve an improvement to regulation, but I cannot see how they
can demonstrate that it will. We are the first Government in the UK to
face up to the challenge of identifying and measuring
10 July 2006 : Column 534
At present, departments are reviewing their regulations and preparing simplification plans, taking into account suggestions for change that have been made by those who have made representations to us from the business, voluntary and charity sectors. Those plans will be published annually because they focus on burdens that are experienced and real to organisations rather than burdens that are imagined as the fruit of the whole stock of legislation and governance. These measures will include a commitment to reduce regulatory burdens on business and the voluntary sector as well as the public sector. The plans will be published at about the same time as the Pre-Budget Report. Departments are also obliged to report on their better regulation work as part of their annual reports. I made that point during an earlier debate.
We do not need prescriptive and inflexible targets on the statute book for a reduction in bureaucracy. Progress to date and our commitment to this agenda should be visible to all. For example, Her Majesty’s Revenue and Customs is already undertaking a measurement exercise. It has already announced a commitment to reduce by at least 10 per cent the administrative burden on business of dealing with HMRC forms and returns, over a five-year period. It also aims to reduce the administrative cost on business of dealing with audits and inspections by10 per cent over three years and by at least 15 per cent over five years.
This amendment is not necessary; it is over-prescriptive; we are already on the right track; we are already working in the direction of reducing the burdens about which the noble Lord, Lord Howard of Rising, is concerned. It would provide us with a straitjacket from which we could not escape and which would, as far as I can make out, provide us with a work stream that could last more than several lifetimes.
The
noble Lord, Lord Howard of Rising, asked: what proportion of
deregulatory work needed amendment to primary legislation? I should
respond to that, although it is an almost impossible question to
answer. We intend to try to use all the tools we can to deregulate;
that is what this legislation is about. We can also use guidance. We
may want to use primary legislation for different measures; and we may
want to use the secondary legislation for different measures, including
orders under the Bill. The Bill enables us to have a more streamlined
procedure, a more exact procedure and one that does not become too
bogged down in the process, but which gets to the heart of what is
required to take action that is effective against things that perhaps
have been on the statute book for some time, that are no longer
necessary, and that are imposing burdens on business and other
organisations. That
10 July 2006 : Column 535
The noble Lord, Lord Howard of Rising, will not have heard a direct answer to his question because I do not think there is one. However, we are attempting to achieve, and we are beginning to achieve, a practical and hard-nosed approach to tackling real problems with regulatory burdens that exist for people out there in the real world, rather than theoretical burdens that the noble Lord seems to think can be solved by a massive expansion in bureaucracy and a rather heavy-handed approach to quantification.
Lord Howard of Rising: Perhaps I can start by trying to take away some confusion for the noble Viscount, Lord Bledisloe. I accept that Clause 1 goes wider than pure regulation. I am hoping that that will be changed at a later stage.
Viscount Bledisloe: Could the noble Lord expand on that extremely cryptic answer? Is he saying that he intends to replace the word “regulation” with “legislation” when he returns with an amendment?
Lord Howard of Rising: The intention is to introduce an amendment to insert the word “regulatory” between the words “reduce” and “burdens” at the beginning of Clause 1.
Lord Bassam of Brighton: What does the noble Lord mean by “regulatory” in that context?
Lord Howard of Rising: The same as in Clause 2. The point is that Ministers already have very substantial power, as the Minister pointed out, to reduce the regulatory burden and they are simply not using it. To try to get them to use that power they must have some form of compulsion. If they do not have it, they will not use it. It is very simple and I cannot believe that the Minister cannot understand that and, ultimately, agree with me. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Howard of Rising moved Amendment No. 32:
- If
a Minister of the Crown is unable to estimate the average burden in
time or cost imposed on persons or businesses affected by a regulation
he has introduced, he shall make an order to remove or reduce that
regulation.”
The
noble Lord said: This amendment looks at the process of assessing the
impact of regulations. The regulatory impact assessments that accompany
pieces of legislation laid before either House are a useful tool for
forecasting where the costs and impacts of policy changes will fall in
future. I see from the Cabinet Office website that as at June 2005,
there was 100 per cent compliance by government departments
10 July 2006 : Column 536
The effects of regulation are what matter. Using the device to measure subsequent performance against the original intention will show whether the legislation is having the intended effect. The purpose of the amendment is to put a duty on Ministers to examine the impact of regulations after their introduction. If the assessment is unable to estimate the effect of the regulation, clearly there is no point in the regulation and it has to be removed automatically.
I understand that since 2003, the National Audit Office has carried out independent evaluations of regulatory impact assessments. On page 32 of its last report, the Evaluation of Regulatory Impact Assessment Compendium Report 2004-05, it stated that nine out of 10 regulatory impact assessments in its sample,
It went on to state that,- “complex monitoring procedures
were sometimes in place but these were not reflected in the regulatory
impact assessments”.
Lord McKenzie of Luton: We understand the thrust of where the noble Lord is coming from with this amendment. I hope, as my first task in this Bill, I can persuade him that his approach is flawed and that what is already in process effectively meets what he seeks to achieve.
He is effectively saying that regulations which the Government are unable to measure in terms of time and cost should either be removed or reduced. That position seems to have no regard to possible evidence of the benefits of introducing the regulation. If we accepted that, the noble Lord could find that important protections for consumers and other groups could be removed. That is why the Government require regulatory impact assessment for new regulations, including consideration of non-regulatory options. All regulatory proposals must be accompanied by a regulatory impact assessment, and major proposals are scrutinised and require approval by the Panel for Regulatory Accountability. The purpose of RIAs and PRA scrutiny is to ensure that the costs and consequences of regulatory proposals are reasonable and proportionate to the benefits. Exemptions for any group or sector, including small businesses, are considered on a case-by-case basis, with Ministers making their decision transparent through the RIA/PRA process.
One of the key
principles of better regulation is light-touch implementation of policy
proposals. The amendment runs counter to that principle, adding an
10 July 2006 : Column 537
On the cost of business, charities and voluntary organisation complying with existing regulations, no UK Government have understood what the estimates of the administrative costs are until now, as my noble friend has just outlined. As part of one of the most ambitious regulatory reform agendas in the world, the Government have faced up to the challenge of identifying and measuring the total administrative costs placed on businesses, charities and voluntary organisations by existing government regulation.
| Next Section | Back to Table of Contents | Lords Hansard Home Page |