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Baroness Noakes: Belt and braces is always a convenient argument, but could the noble and learned Lord explain how the belt-and-braces point applies to the confidentiality declaration? I understood that that was meant to catch everyone on the payroll. He is now suggesting that some other people might not be caught within that, and that there remains a category of person who is not an officer.
Lord Goldsmith: I am making it clear that there does not remain such a category of person. What is important is that the declaration in Clause 3 does apply to officers. It does not apply to people who are not staff in any sense at all. What became apparent in our debate on Tuesday is that non-executive directors, contractors, consultants and so on will not make such a declaration. Those who sign a contract of employment will do so. I should repeat what I said on Tuesday: those persons will none the less still be bound by the statutory duty of confidentiality and the criminal offence that is created by the Bill; they just will not be required to go through the solemn declaration stage. That is covered by Clause 3.
Fundamentally, on Clause 14, the clarity of the provision, which is ultimately what matters, is none the worse for adopting this belt-and-braces approach. The noble Baroness probed whether there was a distinction in our mind between one category and another. Essentially, I have said that there is not, but, to make the clause work as it is intended, this broader formulation has been used.
Amendment No. 30 would remove the ability of the commissioners to delegate their functions "to any other person", that is, a person who is neither a commissioner nor an officer of Revenue and Customs. The noble Baroness said that this is a probing amendment. If I am correct, she identified one example where she recognises that this works in relation to an audit committee. She asked what other sort of examples there might be. For example, Customs commissioners currently delegate to authorised contractors their power to dispose of forfeited goods from Queen's Warehouses. That is an example of a delegation to someone who is neither an officer nor a commissioner.
The provision does not give any wider power to make such arrangements than already exists. I again refer to subsection (4), which provides that "any other person" must act under the directions of the commissioners and the commissioners have a duty to monitor the exercise of the delegation as if the other person were an officer. So we have chosen to go about proper control in a perhaps different way from that suggested by the noble Lord, Lord Campbell of Alloway—to ensure that delegations will be effectively
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controlled and will be included in HMRC's management of risks as required by good corporate governance.
Lord Campbell of Alloway: I accept that.
Lord Goldsmith: I am obliged to the noble Lord. I have sought to give explanations in response to the probing questions put. I hope that they are satisfactory and that the noble Baroness will feel able to withdraw her amendment.
Baroness Noakes: I thank the Minister for his explanations. However, I am still unclear about the different kinds of committees. We know about the delegation to committees under subsection (1)(b), but I do not think we were told about what other kind of delegation might be used.
Lord Goldsmith: The noble Baroness is right and I apologise for that. I cite, for example, a committee set up to look at human resource matters. Non-executives with relevant experience would be included in the membership of such a committee. In the letter that I shall write about corporate governance matters, I shall seek to give other examples of the sort of committees that would be set up, but I hope that the noble Baroness has at least an idea of the committees we have in mind.
Baroness Noakes: I thank the noble and learned Lord. Moving away from issues of corporate governance, let us look at the delegations that may be made under subsection (1)(c). I raised the question of delegation to a body corporate, which could in turn involve a lot of other individuals. I am probing here to find out whether any delegations are made to Cap Gemini, Fujitsu or other major contractors involved in the Inland Revenue. I am trying to find out how this delegation will be used and then to test what kinds of practicable constraints will be put on them—given that those delegations could be very significant. Will the commissioners be able to operate effective controls similar to those provided by the Act regarding employed officers, which will be absolutely crucial? I am still trying to assess the scale of the problem.
Lord Goldsmith: The question posed by the noble Baroness is really whether the expression "any other person" in Clause 14(1)(c) could include a body corporate as well as an individual person. Plainly there will be cases involving individuals, but unless and until I am told otherwise, it seems to me that the phrase "any other person" could as a matter of ordinary statutory construction include a corporate person.
The important point is that Clause 14(4) imposes on commissioners obligations to,
"monitor the exercise of the function by that person, and in the exercise of the function the delegate shall comply with any directions of the Commissioners or of those Commissioners".
Obviously, the commissioners will have to do that in an effective manner, but I see no reason why they should not be perfectly satisfied that a body corporate carrying out outsourced functions such as the provision of support services, hotel accommodation,
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travel bookings, advice on occupational health and so forth—all the functions that the commissioners would otherwise have to provide themselves—can do so properly. Indeed, that may be by far the best way to carry out such functions. To ensure that that is the case, the commissioners will have to monitor the exercise of the functions of the person, and I do not see any difficulty today over such monitoring being carried out on a body corporate. We have moved on a great deal since the days when we could focus only on what people could do rather than what bodies corporate could do.
Baroness Noakes: I am extremely grateful to the noble and learned Lord for that confirmation. It crystallises the nature of the concern I sought to raise in these amendments, which is that the functions which can be delegated are very broad. They go beyond hotel accommodation and IT support; they go to practically everything that the commissioners have the power to do with the exception of those few areas listed in subsection (2). I am concerned that because there are so few constraints, this Bill in effect allows the commissioners to sub-contract to persons, individuals or bodies corporate functions that are close to individual taxpayers, matters which may involve confidential taxpayer information and related issues that we shall debate in greater detail.
Given the very light restriction on delegations, we shall need to look again at whether this is an appropriate scheme of delegation. Given that the restrictions on delegation are so light, while I accept that the commissioners are obliged to oversee the functions, it is another thing entirely to say that they are overseeing someone else if they have delegated 50 per cent of their functions. Nothing in the Bill would stop them doing so.
Lord Goldsmith: I do not wish to prolong the debate. I invite the noble Baroness, when she considers the matter further, to take into account some additional matters. I refer first to the very important extent of the non-delegable functions. Secondly—and the noble Baroness may be pleased to hear me say this—Ministers will be in a position to give general directions on the sort of functions that it would not be appropriate to delegate. Thirdly, there is the nature of the supervision and the external scrutiny required. Fourthly, the commissioners' functions are being delegated. That is different from seeking to delegate, for example, some function of an officer which arises under the relevant Acts which allow for the collection and management of tax. That may be an important point for the noble Baroness to consider. Because she mentioned confidentiality, I have already made the final point about how the confidentiality provisions remain in any event. Perhaps the noble Baroness would like to explore that point more in the technical seminar if she decides to take up the invitation.
Baroness Noakes: I shall not prolong the debate further. We have had a useful debate and identified the
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areas that repay further consideration, which I shall do between now and the later stages of the Bill. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 29 and 30 not moved.]
Lord Kingsland moved Amendment No. 31:
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