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Lord Kingsland moved Amendment No. 22:

("(4) In a case where the investigator--
(a) has reported that a complaint is well-founded, or
(b) has criticised the Authority in his report,

13 Apr 2000 : Column 316

the investigator may include in his report a recommendation to the Authority that it takes steps to remedy the matter complained of including, if appropriate, by making an ex gratia payment.").

The noble Lord said: My Lords, I beg to move.

5.6 p.m.

On Question, Whether the said amendment (No. 22) shall be agreed to?

Their Lordships divided: Contents, 124; Not-Contents, 119.

Division No. 1


Ackner, L.
Addington, L.
Alderdice, L.
Alexander of Weedon, L.
Anelay of St. Johns, B.
Astor of Hever, L.
Attlee, E.
Avebury, L.
Bagri, L.
Barker, B.
Bell, L.
Biffen, L.
Blackwell, L.
Blaker, L.
Blatch, B.
Boardman, L.
Bowness, L.
Brabazon of Tara, L.
Bradshaw, L.
Bridgeman, V.
Brigstocke, B.
Brougham and Vaux, L.
Burnham, L. [Teller]
Byford, B.
Campbell of Alloway, L.
Campbell of Croy, L.
Chalker of Wallasey, B.
Clark of Kempston, L.
Clement-Jones, L.
Colwyn, L.
Cope of Berkeley, L.
Courtown, E.
Cowdrey of Tonbridge, L.
Craigavon, V.
Crickhowell, L.
Dholakia, L.
Dixon-Smith, L.
Donaldson of Lymington, L.
Eden of Winton, L.
Elles, B.
Elliott of Morpeth, L.
Elton, L.
Ezra, L.
Falkland, V.
Feldman, L.
Ferrers, E.
Flather, B.
Fookes, B.
Forsyth of Drumlean, L.
Fraser of Carmyllie, L.
Gardner of Parkes, B.
Geddes, L.
Geraint, L.
Glentoran, L.
Goschen, V.
Griffiths of Fforestfach, L.
Hambro, L.
Hamwee, B.
Hanham, B
Harris of Greenwich, L.
Harris of Peckham, L.
Harris of Richmond, B.
Hayhoe, L.
Henley, L. [Teller]
Higgins, L.
Hogg, B.
Holderness, L.
Home, E.
Hooson, L.
Howe, E.
Hunt of Wirral, L.
Hylton-Foster, B.
Kimball, L.
Kingsland, L.
Kirkham, L.
Lester of Herne Hill, L.
Liverpool, E.
Lucas, L.
Luke, L.
McConnell, L.
Mackay of Ardbrecknish, L.
Marlesford, L.
Mayhew of Twysden, L.
Miller of Hendon, B.
Monro of Langholm, L.
Monson, L.
Murton of Lindisfarne, L.
Newby, L.
Northesk, E.
Norton of Louth, L.
O'Cathain, B.
Onslow, E.
Oxfuird, V.
Park of Monmouth, B.
Patten, L.
Pearson of Rannoch, L.
Phillips of Sudbury, L.
Plumb, L.
Plummer of St. Marylebone, L.
Rawlinson of Ewell, L.
Renton, L.
Roberts of Conwy, L.
Rodgers of Quarry Bank, L.
Russell, E.
Saatchi, L.
Saltoun of Abernethy, Ly.
Seccombe, B.
Sharman, L.
Simon of Glaisdale, L.
Skelmersdale, L.
Smith of Clifton, L.
Soulsby of Swaffham Prior, L.
Stewartby, L.
Swinfen, L.
Thatcher, B.
Thomas of Gwydir, L.
Thomas of Walliswood, B.
Tope, L.
Tordoff, L.
Vivian, L.
Wade of Chorlton, L.
Walker of Worcester, L.
Williams of Crosby, B.
Young, B.


Ahmed, L.
Allenby of Megiddo, V.
Alli, L.
Amos, B.
Ashley of Stoke, L.
Ashton of Upholland, B.
Bach, L.
Barnett, L.
Bassam of Brighton, L.
Blackstone, B.
Borrie, L.
Bragg, L.
Brett, L.
Brooke of Alverthorpe, L.
Brookman, L.
Bruce of Donington, L.
Burlison, L.
Burns, L.
Carter, L. [Teller]
Christopher, L.
Clarke of Hampstead, L.
Clinton-Davis, L.
Cocks of Hartcliffe, L.
Crawley, B.
David, B.
Davies of Coity, L.
Davies of Oldham, L.
Dean of Thornton-le-Fylde, B.
Desai, L.
Diamond, L.
Donoughue, L.
Dormand of Easington, L.
Dubs, L.
Elder, L.
Evans of Parkside, L.
Falconer of Thoroton, L.
Farrington of Ribbleton, B.
Faulkner of Worcester, L.
Filkin, L.
Fitt, L.
Gale, B.
Gladwin of Clee, L.
Goldsmith, L.
Goudie, B.
Gould of Potternewton, B.
Graham of Edmonton, L.
Hardy of Wath, L.
Harris of Haringey, L.
Harrison, L.
Haskel, L.
Hayman, B.
Hilton of Eggardon, B.
Hollick, L.
Hollis of Heigham, B.
Howells of St Davids, B.
Howie of Troon, L.
Hoyle, L.
Hughes of Woodside, L.
Hunt of Kings Heath, L.
Irvine of Lairg, L. (Lord Chancellor)
Janner of Braunstone, L.
Jay of Paddington, B. (Lord Privy Seal)
Jeger, B.
Jenkins of Putney, L.
Joffe, L.
Judd, L.
King of West Bromwich, L.
Kirkhill, L.
Laird, L.
Lipsey, L.
Lockwood, B.
Longford, E.
Lovell-Davis, L.
Macdonald of Tradeston, L.
McIntosh of Haringey, L. [Teller]
Mackenzie of Framwellgate, L.
Mallalieu, B.
Massey of Darwen, B.
Merlyn-Rees, L.
Mishcon, L.
Molloy, L.
Morris of Castle Morris, L.
Morris of Manchester, L.
Murray of Epping Forest, L.
Nicol, B.
Peston, L.
Pitkeathley, B.
Prys-Davies, L.
Ramsay of Cartvale, B.
Randall of St. Budeaux, L.
Rea, L.
Rendell of Babergh, B.
Renwick of Clifton, L.
Richard, L.
Sainsbury of Turville, L.
Scotland of Asthal, B.
Serota, B.
Shore of Stepney, L.
Simon, V.
Smith of Gilmorehill, B.
Stoddart of Swindon, L.
Stone of Blackheath, L.
Strabolgi, L.
Symons of Vernham Dean, B.
Taylor of Blackburn, L.
Taylor of Gryfe, L.
Thornton, B.
Turner of Camden, B.
Uddin, B.
Varley, L.
Walker of Doncaster, L.
Weatherill, L.
Wedderburn of Charlton, L.
Whitaker, B.
Whitty, L.
Williams of Elvel, L.
Williams of Mostyn, L.
Woolmer of Leeds, L.
Young of Old Scone, B.

Resolved in the affirmative, and amendment agreed to accordingly.

13 Apr 2000 : Column 317

5.16 p.m.

Lord Kingsland moved Amendment No. 23:

13 Apr 2000 : Column 318

    Page 231, line 38, at end insert--

("( ) any report prepared by the Practitioner Panel under section 8(4A) and any report prepared by the Consumer Panel under section 9(4A) and the Authority's response to any such report or reports;").

The noble Lord said: My Lords, paragraph 10 requires the authority to make an annual report to the Treasury on the discharge of its functions and certain other matters. The Treasury must lay before Parliament a copy of each report.

The financial services annual report is an important means by which the authority is made accountable to Parliament. However, it is an indirect means. We would like to see far greater accountability.

The amendment would require the annual report to be accompanied by any reports prepared by the practitioner and consumer panels, together with the authority's responses to such reports. The panels have a vital role in acting as sounding boards for the authority. They will have a special insight into the way in which the authority goes about performing its functions. They should be actively encouraged to produce reports which bring their reactions to light.

Under Clause 7,

    "The Authority must make and maintain effective arrangements for consulting practitioners and consumers on the extent to which its general policies and practices are consistent with its general duties under section 2".

Therefore, the consultation is only in relation to general policies and practices. In our view, this is wholly inadequate. There must be an express requirement on the authority to consult the panels on proposed rules, codes, general guidance and statements, and amendments to them. That is the purpose of Amendment No. 36.

Amendments Nos. 37 and 39 would require the authority to give reasons to the panels in circumstances where the authority intends to proceed against the advice of either panel. We believe that that is important because an obligation to have regard to the representations of the panels can easily be side-stepped unless a further obligation exists to give reasons for taking a particular approach.

Amendments Nos. 38 and 40 would enable the two panels, if they so wished, to prepare annual reports on the representations that they have made and on the authority's responses. Such reports would then accompany the authority's annual report when it is submitted to the Treasury under paragraph 10 of Schedule 1.

The Bill provides no certainty as to how the panels are to be funded. Clauses 8(1) and 9(1) refer to the establishment and maintenance of the panels. It is not clear who would meet the cost if the panels wished to prepare and publish annual reports of their work. Amendments Nos. 38 and 40 provide expressly for the costs to be borne by the authority.

The Burns committee recommended that, if the authority does not act on recommendations made by the panel, at the very least it should be obliged to publish its reasons for not doing so. In the Opposition's judgment, that matter is vital. Mr David

13 Apr 2000 : Column 319

Challen, the chairman of the panel (currently called, I believe, the Practitioners' Forum) expressed his fears to the Joint Committee that, in the absence of strong statutory obligations to involve practitioners, they could easily end up being marginalised. He argued that the Bill should include an obligation on the authority to give reasons if submissions by the panel are ignored. Indeed, the first annual report of the Practitioners' Forum reiterated that concern. However, so far the Minister has refused to strengthen the consultation obligation in that way.

We believe that this is a sensible amendment, designed to give the panels the weapons that they need to have a real effect on the authority. I beg to move.

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