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Lord Higgins: I find that a somewhat worrying answer. I did not fully understand the implications. Perhaps one should look back on the arguments deployed in the earlier debates on the e-commerce Bill. Not being a lawyer, I am not clear whether a subcontractor is an agent.
Lord Grabiner: This point is something of a chestnut. It presents itself frequently to courts and tribunals. The whole of our employment legislation rests upon the answer to the question, "Is X an employee?" If X turns out to be an employee, applying the control tests--the point made by the Minister--that person will come within the legislation. The alternative conclusion is that the person will be an independent contractor or sub-contractor.
The essential distinction is that an employee works for somebody, under their control, whereas an independent contractor or agent sells their services for a fee. On the example given by the noble Lord, Lord Higgins, I suspect that a subcontractor would be an independent contractor or agent.
The distinction requires a factual inquiry. The company secretary is almost bound to be an employee of the company and would count as a servant. A subcontractor would sell his services to the company. For example, a contractor who sold employees--in the sense that he was their employer and he provided their services to the company--would be an independent contractor to the company supplying labour only. He would therefore count as an agent rather than a servant.
Lord Higgins: I am sure that the House is most grateful to the noble Lord for that helpful clarification. I wonder whether there is a lacuna in the Bill, because a subcontractor who may have information relevant to an inquiry may not be covered. Perhaps we ought to consider that point, but let us not pursue it now.
It would be helpful to have some elucidation of the position from the Minister. The noble Lord said that some of those points are legal chestnuts. They are not chestnuts that I had previously cooked or consumed, so I am in a bad position on the issue. If the Government approach an individual in a decentralised part of an organisation, they will still be asking for the information from the organisation. The fact that the individual is not on site does not seem necessary. Using the word "servant" opens up the possibility of a particular individual being clobbered by an over-enthusiastic inspector. In its representations, the Bradford and Bingley Building Society quoted the example of an inspector who had demanded information from an individual who was not entitled to give it.
We look forward to receiving the letter that the Minister is going to send us. Let us take it from there.
Baroness Hollis of Heigham: I am happy to clarify the issue through correspondence. To reassure the noble Lord, our solicitors cannot remember a single case in which they have prosecuted an individual under the current powers for refusing to provide information. We are talking about a very rare occurrence, although that does not mean that it should not be clarified.
Baroness Noakes: Why is it necessary to have a power to ask for information from a servant or an agent? The information required is held by the company or other organisation. The request should always be made to the company. The fact that it may be difficult to find the right name to put on the letter is not relevant. The identity of the company or organisation from which the information is required will be known. By inserting this power in the Bill, the Government are suggesting that they might try to get information that is not held corporately. That means that any employee of one of the organisations listed could be asked for information held by them, not in a corporate sense, but in a personal sense. That is a dangerous extension of the Government's ability to get information, when the ability to approach the organisations does not need them to go beyond establishing the right to get the information.
Baroness Hollis of Heigham: I entirely take that point. We shall try to ensure that those issues are covered in the code of practice. We always expect to address our inquiries to the company. Only when we cannot get the information--because the company is decentralised or there are agent arrangements--would we expect to go down to the servant or the agent. The provision is a fallback for cases when the company to which we make the initial inquiry is, perfectly properly, unable to respond to our request for information. Provided that that person has the backing of their company for their action--whether or not they reveal the information--that employee will be protected.
If there are questions beyond that, I shall be happy to seek to answer them in correspondence.
Lord Higgins: We are clear that we need to be a little careful. The Minister has said that the department does not recall any employee being prosecuted for not providing information. On the other hand, it is possible that, for one reason or another, possibly maliciously, employees have provided information that they ought not to have provided. We look forward to receiving the Minister's letter, which will spell that out. Some care in drafting is needed. We may need to consider whether the position of sub-contractors is fully covered by the Bill and whether the word "servant" ought to be in the Bill. Subject to that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Higgins moved Amendment No. 16:
- Page 2, line 23, at end insert--
The noble Lord said: This is different from the previous amendments, which all had a certain similarity about them. This one would add to the list of organisations that may provide information on fraud to the Department of Social Security.
As a result of tabling the amendment, I have incurred the wrath of Liberty on the ground that it goes much too far, so I propose it with some schizophrenia. It may well go too far in the sense that 20 or 30 years ago there were genuine Chinese walls between one department and another. In particular, the Treasury, the Inland Revenue and Customs and Excise were highly determined that the information that they held on individuals should be treated as confidential and should not be translated to other departments. Alas, those Chinese walls have become less and less effective, particularly since the Treasury has taken over large chunks of the Department of Social Security.
The other side of the amendment--I now put on my other hat, if that is not mixing my metaphors too much--is to ensure that there is, in the ghastly jargon, joined-up government. There needs to be an adequate exchange of information between the DSS and other departments that may have information that is relevant to the detection of fraud. We have to consider that, not least in the context of the exchange of information between computers, given the Department of Social Security's unfortunate record on computers.
Perhaps the Minister could give us an idea of the extent to which the Government intend to exchange information between one department and another in the course of pursuing social security fraud and how much of that is likely to be done electronically. She referred earlier to the question of whether someone had a large car. Will the department ask the DVLA for information about car registrations? If so, will that information be linked in a computerised or electronic form? Similarly, for example, although perhaps unlikely in the context of social security fraud, land registry records may reveal property purchases.
Other than in areas where an exchange of information is not appropriate, it would be helpful to be reasonably clear that the Government believe that information transfers between government departments will enable them to pursue the objectives of the Bill.
Lord Grabiner: By way of information and in response to the points just raised by the noble Lord, Lord Higgins, perhaps I may say that I dealt with this point very fully in my report. I do not believe that any subsequent relevant statutory amendments have been made. The noble Lord may find it helpful to look at paragraph 5.13 of the report, down to and including paragraph 5.18, which covers less than a page and a half.
That section of the report includes a table showing the current state of the transfer of information in relation to the matters with which we are now concerned between the relevant government departments. Those departments are confined to Customs & Excise, the Inland Revenue and the DSS. Perhaps I may say that the noble Lord will find a full summary of the current position in a form which is rather more clear and less complex than the legislation which produces that result.
My only additional point is that I reached the conclusion that the table reveals that there are no obvious gaps in the current legislation. That is why I did not make a specific recommendation and why, I suspect, the Bill does not contain, for example, the provision which is the subject of the amendment which we are now discussing. I hope that those paragraphs and, in particular, the table will clarify matters.
Earl Russell: I must confess that I share Liberty's misgivings that the amendment is perhaps a little wide in its drafting. I wonder whether it covers, for example, the Probation Service. I can think of circumstances in which I would not want that service to have to disclose such information. I look forward to the Minister's reply.
("(o) any government department or agency").
7 p.m.
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