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The Earl of Onslow: My Lords, before the noble Lord sits down, I want to ask him a question that relates to what I asked the noble Lord, Lord Bassam, who obviously did not understand what I was saying. In the noble Lord's deregulatory task force, how many of his recommendations needed regulatory as opposed to legislative cure? Did he need to reform or repeal any Acts of Parliament, or could it all have been done by regulation?

Lord Sainsbury of Preston Candover: My Lords, I do not remember exactly; it is a long time ago. A very high proportion did not require an Act.

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Lord Holme of Cheltenham: My Lords, it is a great pleasure to follow the noble Lord, Lord Sainsbury, and his wise words derived from experience about the need to curb the regulatory state in all its aspects. I am
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afraid that I may not be able to avoid returning to those lofty constitutional heights, as it is my honour to serve as chairman of your Lordships' Constitution Committee, but I hope that I will do so in the practical sense that we have just heard.

I am conscious that the Government want, as they so often do nowadays, to move on and not to examine too closely the origins of the Bill. I have two questions. How and why did this Bill in its original form—which has been called the "Abolition of Parliament Bill"—ever see the light of day? Secondly, given that it mercifully has been substantially amended in the light of widespread disquiet, is it now satisfactorily balanced? Is it, in the words of the Minister, "fit for purpose"?

Perhaps it would be helpful if I prefaced my remarks, which on the whole will be critical of the Government, by saying that their avowed purpose of making it easier and speedier to streamline and rationalise regulation—to deregulate—is in my personal view thoroughly sensible. If that is properly provided for, it will be likely, as has been evident already this afternoon, to command widespread cross-party support. In this context, I recommend the Constitution Committee's report on the regulatory state. I welcome the proposal of the Liaison Committee that your Lordships establish a Select Committee on the accountability of regulators so that we can take a sort of overview of the burgeoning power of this sector and make sure that good practice is properly shared.

I acknowledge that, as was said on Report in another place, once the Government finally realised that they were standing shoulder deep in a hole of their own making, they had the wit to stop digging and to try to clamber out. I am afraid that that is as far as politeness will extend on my part this afternoon. In every way, this could stand as a case history of how not to introduce a Bill with constitutional implications. My committee described the consultation process as "lamentable", but I am afraid that we were guilty of understatement.

Why was there no pre-legislative scrutiny of the Bill as there was of the Regulatory Reform Bill in 2000? Why was the Committee stage not taken on the Floor of another place? Why was there no joined-up interdepartmental thinking with the DTI on the Company Law Reform Bill, which embarrassingly foreshadowed these extraordinary ministerial powers with no cross-reference whatever to this Bill? As we know, that provision was withdrawn at the last minute. Why was there no early warning system in Whitehall to tell the Government that they had produced a constitutional monstrosity? My committee in its own small way did its best in January by writing to the Lord Chancellor, the guardian of constitutional matters within the Government, but on 7 February we received a reply of unwavering blandness, protesting the good intentions of the Government.

This road has been paved with good intentions. Indeed, later in the Bill's passage through the other place, ministerial assurances were given in profusion,
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not least by Jim Murphy, the Minister responsible, that these extraordinary powers would never be abused. But ministerial assurances are walls of sand. I do not for a moment doubt the good faith, integrity and the personal "intentions" of Ministers, but, first, Ministers change, secondly, governments change and, finally, political memories are short and selective. That is why constitutions are about laws, not men, and it is why the bulwarks against the arbitrary misuse of power have to be made of constitutional concrete, not the shifting sand of good intentions.

Some have seen the original Bill as a straightforward power grab by the Executive at the expense of Parliament. I am more charitable. It is more likely to be a question of what so many people in business complain about in regulation—the phenomenon of gold-plating. This Bill was gold-plated; the Government tried to anticipate every eventuality and that process made the legislation too wide-ranging. Whatever the reality, I very much hope that the Government have learnt their lesson. When the Minister responds to the debate, can he assure us that Bills with deep constitutional implications will not be treated in such a reckless and cavalier manner in future?

In case the Government are not sure what is constitutional, which is not always easy with our unwritten constitution, our report on the Bill, House of Lords Paper 194, provides two checklists that the Government might care to refer to in identifying what is likely to have constitutional significance, as my noble friend Lord Goodhart has stated.

So, what now? Our report suggests that the balance of the Bill, even as amended, between rapid reform—which is often needed in the regulatory sphere—and proper parliamentary control is still not right. We have made several suggestions as to how that might be redressed and I welcome the concession made by the Minister in his opening remarks. The nature of amendments that are passed is, of course, a matter for your Lordships' House and, no doubt, amendments will be produced along the lines that we suggest and in other ways. The key issue is how the two watchdog committees can ensure that they bark and bite to good effect.

I sincerely hope that the Government will maintain their tardy discovery of flexibility and continue to pay attention—and I welcome the assurances made this afternoon—to the legitimate concerns of Parliament. The need to reconcile the demands of a benign deregulatory impulse with the careful operation of parliamentary procedures and the principles of democratic government is a topic worthy of the skills and experience of Members of your Lordships' House. I hope that we reach a successful conclusion.

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Lord Lloyd of Berwick: My Lords, the noble Lord, Lord Desai, said that we are all against red tape. If this Bill was confined to the reduction or, still better, elimination of red tape, I would have no problem with it. There is no reference, which I would like to see, in
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Clause 1 to "red tape". Instead, there is a reference to what is called a "burden" and sometimes an "overall burden". I doubt whether the average person who reads Clause 1 for the first time would understand what the Bill is about. However, I put that to one side.

I have no difficulty with Clause 1(3)(a), (b) and (c), which refer to:

and obstacles

which were covered by the noble Lord, Lord Sainsbury of Preston Candover, in his important speech, with all his experience. I do, however, have considerable difficulty with subsection (3)(d). Surely the power to remove a criminal sanction for doing anything in the course of any activity must be far too wide for a deregulation Bill. That point was made very clearly by the noble Lord, Lord Goodhart.

I do not wish to do anything other than to address Clause 3. It appears that that clause has nothing whatever to do with deregulation. As so often happens, it seems to have been tacked on to the Bill almost as an afterthought, although it deals with a subject that seems to be, if anything, of even greater importance than deregulation. The creation of the Law Commission, which was the brainchild of Lord Gardiner when he was Lord Chancellor, was one of the best things that that Labour Government ever did. Lord Scarman, as noble Lords will remember, was the first chairman of the Law Commission, and many other judges have filled that role since then. I like to think that there was an unwritten agreement between the Lord Chancellor and Lord Scarman that if the Law Commission did its job well—I think that everyone accepts that it has done so extremely well since it was set up—successive Governments on their part would provide sufficient parliamentary time to put its recommendations into effect. From the beginning, it is sad to say, successive Governments have fallen down on their part of the bargain so that a backlog has built up of the kind that we see today. In May this year, 26 reports were outstanding, some from as long ago as 1991. Fourteen of those 26 have already been accepted in principle by the Government but still nothing has been done. That is indeed a dismal story—almost as dismal as the story told by the noble Lord, Lord Sainsbury, in relation to his attempt to deregulate all those years ago.

Why has nothing been done? There is always the same excuse: that the Government cannot afford the parliamentary time. Here I refer of course to all Governments—let us call them the Executive—and not to one Government rather than another. Yet, although they say that they have no time for these important matters, they have somehow found time, as we all know, to pass 25 criminal justice Bills in the past 12 years. Something has gone wrong with governmental priorities in this respect.

Now, the Government have at last decided to do something for which we—and, I am sure, the Law Commission—must be grateful. However, I believe that they have set about it in the wrong way. The views
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that I am about to express are my own, as noble Lords would expect, but they are views that I formed—here I plead guilty—without having had the advantage of reading the reports prepared under the chairmanship of the noble Lords, Lord Dahrendorf and Lord Holme of Cheltenham. For once I have come to a conclusion without reading all the evidence. Law reform, as Lord Gardiner used to say, is far too important not to be dealt with on the Floor of this House. We cannot leave it to the Law Commission, good though it undoubtedly is, to legislate on our behalf. It is, I think, a job for us. Again, I find myself in complete agreement with the noble Lord, Lord Goodhart.

It is interesting that the Government have gone a very long way towards accepting that principle. They have undertaken that Clause 3 will not be used for what they call controversial, or sometimes highly controversial, reports. But what use is that? At once, it raises the question: who decides which of the reports are controversial? When that undertaking has been given, how can it be enforced? Nothing in Clause 3 says that the Minister's powers under that clause are limited to implementing non-controversial reports. Why not, if that is its meaning? Let us put those words in and, if the Government then have difficulty in defining what they mean by non-controversial reports, that is only because the line they are seeking to draw between controversial and non-controversial reports is simply not a line that can be drawn.

Then it is said that there is no need to worry about all this, which I do, because the Select Committee will be able to make recommendations, which must then be accepted. That is the so-called veto, but what sort of veto is it? As the Bill stands, the committee can make recommendations only within very narrow limits. One is that the order does not serve the purpose set out in Clause 3(2), but, again, what good is it? However controversial the Law Commission report may be, it will still contain a recommendation, so that particular safeguard carries one nowhere. That is equally true of the conditions set out in Clause 4(2). As the Bill stands, the committee will have no power to say, "This is a highly controversial Bill", and presumably, should it arise, it would be so advised by the Table.

Therefore, it is crucial that the Government look again at the committee's powers to make recommendations. I respectfully suggest that one recommendation it must be able to make is that the Law Commission report is controversial. Even then, that will not do a great deal because the recommendation can always be reversed by a resolution of the House. So, once again, even if it is reversed, who is to say whether it is controversial? The very fact that it is reversed by a resolution of the House must surely mean that it is still a controversial Bill.

What is the answer? It can only be that we must exclude from the Bill the parts that refer to Law Commission reports. I am all in favour of Law Commission reports, which are entirely technical in the sense of tidying up legislation. They should be able to go through via a fast-track procedure, but that procedure is surely to be found not in this Bill but in the existing Standing Orders of the House. Those
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enable such matters to be considered, if necessary, by a body of which I used to have the honour to be chairman—namely, the Joint Committee on Consolidation Bills. That suggestion was made in the other House. It may be that the Standing Orders of the other House are slightly wider than ours but, one way or the other, that is the way to deal with truly non-controversial reports and not the way proposed in the Bill.

4.59 pm

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