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Lord Renton: I am very surprised at the comments made by the noble Lord, Lord Clinton-Davis, with whom I sometimes have the honour of agreeing, but not on this occasion. We should bear in mind that the Government who call themselves "new Labour" are far more broad-minded than old Labour used to be. On a number of occasions—I shall not cite them all—the new Labour Government have enlisted the help of private enterprise in order to perform public duties. That is all that the amendment suggests. I would have hoped that it would receive a favourable reception from the Government Front Bench.

5.30 p.m.

Lord Goodhart: I wish to speak to Amendment No. 11 which stands in the name of myself, my noble friend Lord Thomas of Gresford and others. Under Section 27(3) of the Courts Act 1971, as amended by the Deregulation and Contacting Out Act 1994, the Lord Chancellor may contract out the provision of officers and staff for non-judicial functions, but under Section 27(6) the Lord Chancellor must consult with the four senior judges before contracting out any services.

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We believe that that obligation should be repeated in this Bill. If the Lord Chancellor is minded to contract out the provision of courtroom security to a private security firm—an example of what has already been contracted out—surely it is appropriate that he should consult with the senior judges. Picking up a point made by my noble friend Lord Thomas of Gresford, it is increasingly clear that the Lord Chancellor can no longer be regarded as a judge and that he should take the opinion of the judges—the four designated senior judges—before he contracts out any services that otherwise would be provided by the agency.

Baroness Gibson of Market Rasen: I notified the Public Bill Office that I wanted to withdraw Amendment No. 10, so I shall not speak to it. However, I wish to speak to Amendments Nos. 11 and 12. Overall the Bill has been welcomed by the relevant trade unions because it streamlines the system relating to the courts and brings in accountability where there was none before. Those points are seen as great steps forward. The single executive agency and the proposed courts' administration councils are welcomed. However, the unions have some worries about parts of the Bill relating to the management of the new systems and about contracting out.

Contracting out is not an easy subject to understand fully and requires some cross-referencing between Acts. In this context, Clause 2 raises some queries in my mind and in the minds of the trade unions representing the employees involved. Clause 2(4) appears to allow for the expansion of contracting out and removes the requirements and safeguards that currently apply: that is, consultations that take place with the senior judiciary, as the noble Lord said.

The Courts Act 1971, as amended in 1994, specifically provides that any proposals to contract out must be examined by four senior judges and both Houses of Parliament before any contracting out of court work can be undertaken. We cannot understand why those safeguards are being removed. The wording of the Bill appears to weaken considerably the safeguards currently surrounding contracting out and the unions involved have raised their anxieties with me and with other noble Lords. My noble friend Lord Lea of Crondall also indicated worries on this issue at Second Reading.

The system of scrutiny that has worked well until now is an important checking mechanism. Not only does it ensure the fair administration of justice; it also maintains the independence of that justice. These amendments have been tabled to reinstate the previous provisions from the 1971 Courts Act as amended in 1994; they redress what we see as a weakening of procedures that have worked well in the past.

Lord Hylton: I hope that whichever Minister replies to this amendment will answer fully the important points raised by the noble Lord, Lord Thomas of Gresford, on the previous amendment; namely, what is the real level of costs in transferring such staffs from

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their present employers to the Civil Service scheme and why should it be so costly to transfer their pensions? Those questions were not answered at all by the previous reply from the Government. I hope they will be answered now.

Lord Thomas of Gresford: I am grateful to the noble Lord for his support. It seems to me that the Government may have in mind reducing the cost by making more and more employees of the Court Service part of a contracted out service where pensions would not apply to them. That was the reason for my previous question. Putting two points together, is it intended, for example, that all court ushers should be part of a contracted out service? Or the office staff, or the listing officer? So many important functions in the courts are carried out at the moment by people who are fully part of the administration.

To cut costs it would be tempting for the Government to say that they will transfer to the Civil Service pension as full-time employees those who have some judicial function to perform or who have to exercise a judicial discretion, according to the terms of subsection (5) of the clause. That would refer to a limited class of people—perhaps court clerks, but not many below that level. It is possible, it seems to me, that employees will lose considerable rights as a result of this clause.

Lord Bassam of Brighton: Before I refer to the substance of the amendments I owe the noble Lord, Lord Thomas of Gresford, an apology for not addressing his point on costs. I did not have the figures to hand and still do not. I can refer him to the Explanatory Notes at paragraph 290 which gives a broad outline of costs. It says:

"The current cost of running the magistrates' courts is £435m per annum".

Our intention is to ensure that there is a more than adequate resource for the new service. It is perhaps worth putting on the record what was expressed in correspondence on this point by Yvette Cooper, the Minister responsible for the Bill in another place. The letter was to one of the trade union representatives. She said:

"Funding the new agency. With regard to the point you raised about funding the new agency generally, this will be accommodated from within Departmental spending limits, using appropriate phasing and piloting as necessary. I agree that it is important that the new agency should be properly funded, which is why it will not be established until it is known how the costs can be met. As part of the development of the new agency's blueprint, more work is needed to determine the cost profiles associated with the management of the transfer of pay and pension responsibilities, buildings and associated contractual obligations to the new agency. Until a clear costs profile has been established together with how those costs can be met, clauses bringing the new agency into effect will not be invoked".

I am conscious that the noble Lord, Lord Thomas of Gresford, sometimes pokes fun at what he may describe as "management speak", but I believe that this is a clear commitment to ensure that the agency is properly funded, and that until more precision can be brought to bear on the costs and the costs of

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transferring pay and pension responsibilities, those matters will not be established and put in place. That is a reasonable guarantee to give.

Perhaps I can go a stage further. We shall try to put more meat on the bones and see what more information can be provided in terms of facts and figures. It is only reasonable to make the point that such matters are part of an iterative process, that there is much to work out in the detail and so on, but our clear commitment is to undertake to do that.

We also want to offer reassurance, principally to the noble Lord, Lord Thomas, and to other noble Lords who have been responsible for properly tabling the amendments. There is no plan to expand contracting out as described. Contracting out will be used, as at present, simply to provide some flexibility. It is not part of the transitional plan. We cannot make it clearer or plainer than that. There is no hidden or secret agenda; it is simply to provide the necessary flexibility.

I turn to the amendment moved by the noble Baroness, Lady Anelay of St Johns. Clause 2(4) states:

"The Lord Chancellor may enter into such arrangements . . . as appear to him appropriate for the purpose of discharging his general duty in relation to the courts".

The clause does not set out all the bodies or persons with whom the Lord Chancellor can enter into arrangements, as that would restrict his flexibility and choice. It is the Government's intention that the Lord Chancellor will be able to enter into arrangements with a range of people or bodies, including, as I said, private companies, self-employed people or independent contractors, as and when appropriate. For that reason, we doubt whether the noble Baroness's amendment is necessary or adds anything, although it is kind of her to have thought of the point. We are grateful to her for giving some further thought to the point, but we see no reason to go further than we have.

I am grateful to the noble Baroness, Lady Gibson of Market Rasen, for withdrawing Amendment No. 10. As the noble Baroness said, Amendment No. 11 would oblige the Lord Chancellor to consult heads of division before contracting out under Clause 2. I doubt whether a specific provision requiring him to consult heads of division is necessary or appropriate. The current statutory instrument, made under Section 27 of the Courts Act 1971—the Contracting Out (Administrative and Other Court Staff) Order 2001—provides for a general power to contract out the provision of services listed in Section 27(1) of that Act.

Given the broad terms of the 2001 order, there is a question over what consultation with heads of division would otherwise achieve. The order is only about the power to enter into contracts; it does not cover or govern any actual or proposed contracts. It is simply concerned with the power to enter into those contracts. I want it in the public domain and on the record that the Lord Chancellor would obviously wish to continue to consult in much the same way that he currently does. Regular consultation is carried out, in particular, with senior judges about contractual matters. We will continue to consult, and the normal processes will continue. The fears that have been expressed about the

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provisions are not justified. I hope that, in trying to describe the arrangements, I have provided the necessary assurance.

5.45 p.m.

Lord Ackner: Can I intervene without embarrassing the noble Lord? No one is levelling their guns at this Lord Chancellor, but, if we leave the power in without any obligation to consult, his successors would be immune from any obligation. The fact that the noble and learned Lord the Lord Chancellor has wisely consulted on major matters would be history. We need something that will bind his successors, who may not be as generously disposed to the judiciary.

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