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The noble Baroness said: The amendment addresses the danger that a conflict of interest may arise in the provision of services by a system of tendering for contracts under the contestability system. Concerns have been expressed throughout the debates on the Bill, within Parliament and outside it, about the conflicts of interest that could arise in certain circumstances, and my amendment seeks to find a way around that.

The prime example of where a conflict might arise is where the same party is responsible for writing reports for the court as well as providing the services that might be recommended in those reports. The fear is that the party might be tempted to support its own services and generate business in that way.

At the moment, the preparation of court reports appears to be protected from contestability, at least for the time being, by Clause 4. But of course that protection may be removed at some stage by secondary legislation under Clause 12. Once that has happened, there is a distinct possibility that a conflict of interest could arise.

It is obvious that if a recommendation is made in a report to a court for a particular disposal, there must be no hidden interest in it. At present, it is not possible for that to happen since the reports are prepared by members of Napo, but in the future, if reports are prepared by private companies or voluntary organisations whose business is also the running of programmes of rehabilitation, it is just possible that a conflict of interest could arise. I am grateful to the National Association of Probation Officers for its helpful briefing and its support for the amendment.

The amendment would add a new subsection to Clause 3. It imposes good practice on the providers of probation services with regard to the avoidance of a conflict of interest. I beg to move.

Lord Waddington: It is hardly necessary to add to what has been said by my noble friend, who has set out the position very clearly. There will be the opportunity for conflicts of interest to arise under the new system and precautions must be taken against that happening; otherwise there may well be challenges in the court.

My noble friend is entirely right: a company running prisons or an electronic tagging scheme might also be commissioned to write court reports. A recommendation that somebody should be tagged could, if implemented, result in money going into the pocket of the provider which could, in turn, lead to challenges in court as to the fairness of the trial. I invite the Minister to recognise that there is a problem here; if we are to avoid court challenges, something should be added to the Bill to make it plain that these conflicts of interest should not be allowed to arise.

Baroness Linklater of Butterstone: I support this important amendment which seeks to address the conflicts of interest which may arise from introducing contestability into the process of providing probation services. Specifically, if the providers come from the private sector, their services will be related to the profitability of the organisation and their need to justify their effectiveness and financial management to their shareholders. As professional providers of a service, it is fundamental that the advice they give should be absolutely impartial and disinterested. There should not be the faintest suggestion or implication that such advice is driven primarily or in part by any financial interest to them.

Profitability is clearly a key driver in the management and administration of any private company. The integrity of the organisation must be beyond question and at all times their services must have the best interest of the client groups as the central focus. Their profitability should not be seen to be at the expense of professional standards and best practice. We have just heard about the risk of a potential conflict of interest that exists if advice is given to a court by a private provider whose business will benefit if it is taken, or if a probation trust signs a contract with a private company for its services and has a judge or a magistrate as a member. Will the Minister clarify this issue?

Where contestability is part of a bidding process for the provision of services, the providers will seek to demonstrate that they can provide better services at a better rate and represent better value for money than other bidders. To many people, this bidding process does not lie easily with putting the needs of beneficiaries of a service first, be they victims, offenders or the community. Clearly, there has to be some guarantee of high standards where best practice can be demonstrated first. There is a delicate and often difficult balance to be struck here, and it is uncharted territory where criminal justice issues are concerned. In their document Reducing Crime, Changing Lives, the Government stated that their interest in the process of contestability lay in getting,

This process has been in operation in the private prison sector, where four different companies run nine prisons. The process has been perceived to have had the effect of forcing the public sector prisons to raise their game, reduce their costs and win contracts from their private sector competitors. While this was seen to be true in the early days, some private prisons have in the recent past received seriously critical inspection reports. Indeed, one of them was the subject of a truly shocking television programme. It has been stated that contestability has reduced costs in prisons by worsening terms and conditions for staff and increasing workloads and hours worked. Those which were performing badly were found by Her Majesty’s inspectors to have dangerously low staffing levels. It is axiomatic that best practice requires that staff work on a one-to-one basis to achieve the best outcomes. To cut down staff will inevitably lead to poorer outcomes. As we now know, salaries are generally lower, the level of training poorer and the changeover of staff higher than in the public sector. I would therefore suggest that they are no longer necessarily the best comparators.

The Government’s contestability prospectus cited six different types of contestability programmes which could be used: contests held to commission alternative provision if existing providers fail to provide or deliver a satisfactory improvement plan; market testing; extension of partnership working and sub-contracting; competitions to run new businesses; pathfinder projects to find new solutions; and new competitions for previously competed services.

Historically, the Probation Service has always worked in partnership with the voluntary sector and the private sector. The target set by the Home Secretary for contracted-out services to increase to 10 per cent will only take us back to the situation that prevailed before 2001. It is not seen as a problem; nor do we on these Benches have a problem with the idea that we should tap into as wide a range of probation providers as possible, including the voluntary and private sectors, to enhance and develop standards and the ways in which we can reduce reoffending and make our society safer. More effective case management and better-targeted interventions should be a constant goal for providers. However, as we have argued elsewhere, this is not a conventional market as it is understood by the private sector. Evidence—we have been talking a lot about evidence today—that contestability achieves the desired results is thin on the ground to say the least.

We therefore have strong reservations about the idea that contestability and the sometimes crude battles of the market place are an entirely appropriate means of meeting the needs of often very vulnerable people.

We entirely accept that it is essential that all players in the field are encouraged to raise their game and the standards of practice as well as principle, which is why we have consistently argued for the development of partnerships in the provision of probation services. I have cited how the Scottish model has worked and argued for the duty to co-operate between agencies in England and Wales. We have heard how such an ethos exists in children’s services and issues of racial equality. It applies in youth offending teams and MAPPA. It is an approach that sits more comfortably with the nature of the work in which all these agencies are engaged. A client needs best practice in achieving the highest standards, which are not necessarily achieved by pitting organisations against each other—especially when a multiplicity of bodies is engaged in the process. We cannot risk losing all that we think is best or, as the noble Lord, Lord Judd, said, throwing the baby out with the bathwater.

The Lord Bishop of Chester: I entirely support all that has been said in this debate so far. However, rather than simply trying to legislate against conflicts of interest, which does not entirely remove the conflict of interest, there are some aspects of the Probation Service that it is simply not appropriate to put into private hands. The writing of pre-sentence reports may well be one of those aspects. I would go a little further even than the amendment and ask whether allowing all the different functions to be discharged privately is not perhaps throwing the baby out with the bathwater. Should certain things not be done by the justice system in the public sphere?

Baroness Turner of Camden: I, too, support the amendment. The Bill envisages far greater involvement of the private sector in providing a probationary service. In these circumstances, it is essential that the Government should ensure that there is no conflict of interest. The amendment, as a number of speakers have indicated, would eliminate the risk of a conflict of interest should any area of probation work be contracted out to a company with a financial interest in the outcome. It would be wise to have an amendment with wording of this kind in the Bill to make it absolutely clear that the Government have taken all the steps that they possibly can to avoid any conflict of interest in this new arrangement.

Lord Ramsbotham: I support the amendment, but before speaking to it I must apologise to the Committee for some wrong information that I gave on Monday, which the Minister with her habitual acuity—to use one of her favourite words—picked up. I said that the London Probation Service had issued warnings to 60 per cent of its staff. In fact, I should have said 60 personnel. I misread my notes, and I apologise for that. The worry, though, is that those 60 personnel include some very senior members of staff, which is the onus of my concern.

Previously, one strength of the Probation Service was that it was responsible for both offender management and interventions. The introduction of NOMS has separated the two. Whereas the tasks connected with offender management appear to be left more to the public sector, the intervention tasks seem more often to go out to contracting. I wonder if that is not a difficulty that might not be revisited. As the right reverend Prelate said, a clearer statement of which probation services should remain—not just for three years but for ever—might remove this problem.

Baroness Scotland of Asthal: I thank the noble Lord, Lord Ramsbotham, for his apology in relation to what he said on two or three occasions last time the Committee met. It is clear that 60 per cent differs very greatly from what is less than 2 per cent of the London probation staff, and no reference is made to front-line staff. Indeed, front-line staff will not be affected by any redundancies. The posts are being considered for redundancy from within senior management but will not necessarily amount to 61. I am very grateful to the noble Lord for apologising for misleading the Committee.

6 pm

Court work has been an area of particular interest and concern as the Bill has progressed through the other place and here. I remind the right reverend Prelate that Clause 4—an amendment which was made in the other place—now gives real relief. It goes directly to the point that he makes. Clause 4(2) states:

That provision will stay in place unless and until it is changed by an affirmative resolution made by both Houses. Therefore, the assurance that the right reverend Prelate seeks in relation to pre-sentence reports is catered for.

Several Members of the Committee mentioned an anxiety. It was mentioned by the noble Lord, Lord Waddington, echoed by the noble Baroness, Lady Linklater, and supported by the noble Lord, Lord Ramsbotham. There is no difference between us on the necessity to eradicate any form of conflict of interest. However, the right reverend Prelate is right that one cannot legislate for that in the way that is proposed. I say to the Committee as lightly as I can that some in the voluntary sector assert that the Probation Service already has the opportunity both to write reports and to carry out the work. Some in the voluntary sector believe that they could do that work more effectively and appropriately and achieve better outcomes. Because there is no lever to oblige the Probation Service to act in partnership, it does not have the opportunity to do so. Those not in the public sector, particularly those in the voluntary sector, have asserted that there is a monopoly through which the Probation Service is able to write the reports and then to guarantee that it—a public sector body—also does all the work. I am not saying that one side or the other is right. However, it depends on where you stand as to whether you think there is a conflict of interest here. We want no one to have that conflict of interest.

I understand that there is genuine anxiety about the risks of a conflict of interest arising if one organisation—no matter which it happens to be—both proposes and provides outcomes for offenders. There is concern that its advice might be skewed towards those outcomes which it provides. But bearing in mind what I have just said, we may be making too much of this. After all, we have that situation under the current arrangements.

A number of safeguards are therefore in place to ensure that pre-sentence reports are developed appropriately. First, when the court requests a pre-sentence report it also provides an indication of the expected sentencing outcomes, so that the report can be focused accordingly. Secondly, the report must then adhere to national standards, which we will discuss in more detail under a later set of amendments. Thirdly, there is clear guidance on the type and structure of report to be provided, based on the seriousness of the offence and the appropriate response.

More generally, the development of a more holistic performance management framework, coupled with the introduction of commissioning and contractual relationships, will bring greater transparency to the process and make it easier to spot any potential difficulties.

However, I understand that there is still anxiety that these risks might increase if non-public sector providers were involved. As I have indicated, I am not sure that that is the case, but I understand that anxiety. Certainly, all the standards and guidance I have just mentioned would apply to all providers, from whichever sector they came. It is absolutely critical that we have parity of treatment.

But in any case, as I indicated, non-public sector providers will not advise courts in the foreseeable future. As I made plain, that is the effect of Clause 4, which prevents the Secretary of State contracting with a non-public body for the giving of assistance to courts. This restriction can be lifted only by means of an order subject to affirmative resolution. I assure the Committee that, before that could be done, one would have to produce cogent information to persuade both Houses that it was appropriate.

The statutory restriction does not cover the Parole Board. However, this area of work is covered by the commitment we have previously given; namely, that for the next three years we will let contracts for offender management only with the public sector. Advising the Parole Board is an important area of probation work, but the service produces far fewer parole reports than it does court reports, and we think that the risks of genuine conflicts of interest are fewer.

However, if the Government ever seek to lift the restriction in Clause 4, I accept that the conflict of interest point will need to be addressed. But it will require more than a clause in this Bill. It will require practical measures which take account of the state of the market, the nature of the providers, the contractual provisions, incentives, performance management arrangements and so on. The Government would need to provide details on these issues in order to secure the support of the House. If I have learnt anything, I have learnt that much.

However, we are not yet at that point. It is helpful to have the opportunity to discuss these issues, but the clause is neither necessary now, nor does it provide sufficient safeguards for the future. On that basis I invite the noble Baroness, Lady Anelay, to withdraw the amendment, confident, as she must be, that these important issues would need to be addressed.

Baroness Anelay of St Johns: They are indeed important issues which need to be addressed. The right reverend Prelate properly pointed out that there are concerns about the core issues and their protection. The Minister directed him to Clause 4, but his point is still relevant to my amendment. I say to the right reverend Prelate that my amendment seeks to address the Bill as it is now. That is why I have pressed ahead with the amendment. That is relevant to the Minister’s argument. She says that I do not need to trouble myself about this matter now because the non-public sector is not yet giving advice to the courts, although it may happen in the future. She recognises that a conflict of interest may need to be addressed later. However, I am looking at the Bill as it stands. This is the only opportunity I may have to address good practice in the Bill.

The Government have given an assurance that they will not seek to bring a statutory instrument before the House for three years, but after that it becomes open season, irrespective of the rigour with which the House may scrutinise an affirmative instrument. We would be entering uncharted waters with regard to contestability. I am very grateful to Members of the Committee for their support and for the caution that they exercised in what they said about contestability. The Minister says that in the future the process will be more transparent. However, the Government themselves argue that, given the necessity for commercial confidentiality with some of the contracts, they will not open up that process to parliamentary scrutiny and so there will be difficulties.

I accept that one cannot, by any legislation, legislate away conflicts of interest. I also argue that one cannot by legislation move out of public life everything that is wrong in the world; but we all have a go at it. Otherwise, we would not be sitting here debating what is the more than 60th piece of Home Office legislation since 1997. We keep trying. In my fairly brief amendment, I am seeking to put some clarity in the Bill about a duty to avoid a conflict of interest. It is important and, on this occasion, I wish to test the opinion of the Committee.

6.10 pm

On Question, Whether the said amendment (No. 48) shall be agreed to?

Their Lordships divided: Contents, 114; Not-Contents, 94.

Division No. 1


Addington, L.
Alderdice, L.
Anelay of St Johns, B.
Astor of Hever, L.
Barker, B.
Beaumont of Whitley, L.
Bilimoria, L.
Blaker, L.
Bowness, L.
Bridgeman, V.
Burnett, L.
Byford, B.
Chester, Bp.
Clement-Jones, L.
Colwyn, L.
Cope of Berkeley, L. [Teller]
Cotter, L.
Courtown, E.
Craigavon, V.
Crickhowell, L.
Croham, L.
Darcy de Knayth, B.
De Mauley, L.
Dean of Harptree, L.
Dear, L.
Denham, L.
Dholakia, L.
Dixon-Smith, L.
D'Souza, B.
Dykes, L.
Eccles, V.
Eccles of Moulton, B.
Falkland, V.
Ferrers, E.
Fookes, B.
Fowler, L.
Geddes, L.
Gibson of Market Rasen, B.
Glasgow, E.
Glenarthur, L.
Glentoran, L.
Greenway, L.
Griffiths of Fforestfach, L.
Hamilton of Epsom, L.
Hamwee, B.
Hanham, B.
Harris of Richmond, B. [Teller]
Henley, L.
Higgins, L.
Hooper, B.
Hooson, L.
Howe, E.
Howe of Aberavon, L.
Howe of Idlicote, B.
Hunt of Wirral, L.
Hylton, L.
Inglewood, L.
Jenkin of Roding, L.
Jones of Cheltenham, L.
Kimball, L.
King of Bridgwater, L.
Kingsland, L.
Kirkwood of Kirkhope, L.
Lawson of Blaby, L.
Lee of Trafford, L.
Lindsay, E.
Linklater of Butterstone, B.
Low of Dalston, L.
Lucas, L.
Luke, L.
Mackie of Benshie, L.
Maclennan of Rogart, L.
Maddock, B.
Mancroft, L.
Mayhew of Twysden, L.
Miller of Chilthorne Domer, B.
Montrose, D.
Morris of Bolton, B.
Noakes, B.
Northesk, E.
Northover, B.
Norton of Louth, L.
O'Cathain, B.
Onslow, E.
Park of Monmouth, B.
Pearson of Rannoch, L.
Ramsbotham, L.
Rawlings, B.
Redesdale, L.
Rodgers of Quarry Bank, L.
Rogan, L.
Roper, L.
Saltoun of Abernethy, Ly.
Sandwich, E.
Seccombe, B.
Selsdon, L.
Shephard of Northwold, B.
Smith of Clifton, L.
Stern, B.
Taylor of Holbeach, L.
Teverson, L.
Thomas of Gresford, L.
Thomas of Walliswood, B.
Thomas of Winchester, B.
Tonge, B.
Trimble, L.
Turner of Camden, B.
Tyler, L.
Waddington, L.
Wakeham, L.
Wallace of Saltaire, L.
Walmsley, B.
Wilcox, B.
Windlesham, L.


Ahmed, L.
Alli, L.
Amos, B. [Lord President.]
Anderson of Swansea, L.
Andrews, B.
Archer of Sandwell, L.
Ashton of Upholland, B.
Bassam of Brighton, L.
Berkeley, L.
Bernstein of Craigweil, L.
Borrie, L.
Boyd of Duncansby, L.
Bradley, L.
Brett, L.
Brookman, L.
Brooks of Tremorfa, L.
Burlison, L.
Campbell-Savours, L.
Clinton-Davis, L.
Corbett of Castle Vale, L.
Crawley, B.
David, B.
Davidson of Glen Clova, L.
Davies of Coity, L.
Davies of Oldham, L. [Teller]
Desai, L.
Elder, L.
Evans of Parkside, L.
Evans of Temple Guiting, L.
Falkender, B.
Farrington of Ribbleton, B.
Faulkner of Worcester, L.
Ford, B.
Foster of Bishop Auckland, L.
Fyfe of Fairfield, L.
Gale, B.
Gilbert, L.
Golding, B.
Goldsmith, L.
Gordon of Strathblane, L.
Goudie, B.
Gould of Potternewton, B.
Grocott, L. [Teller]
Harris of Haringey, L.
Harrison, L.
Hart of Chilton, L.
Haskel, L.
Haworth, L.
Henig, B.
Howarth of Newport, L.
Hoyle, L.
Hughes of Woodside, L.
Hunt of Kings Heath, L.
Jones, L.
Jones of Whitchurch, B.
Kennedy of The Shaws, B.
King of West Bromwich, L.
Kirkhill, L.
Lea of Crondall, L.
Lipsey, L.
Lockwood, B.
McDonagh, B.
MacKenzie of Culkein, L.
Maxton, L.
Morgan, L.
Morgan of Drefelin, B.
Morris of Aberavon, L.
Morris of Handsworth, L.
Morris of Yardley, B.
Moser, L.
Patel of Blackburn, L.
Pendry, L.
Puttnam, L.
Quin, B.
Ramsay of Cartvale, B.
Rea, L.
Richard, L.
Rooker, L.
Rosser, L.
Royall of Blaisdon, B.
Scotland of Asthal, B.
Simon, V.
Soley, L.
Stevens of Kirkwhelpington, L.
Symons of Vernham Dean, B.
Temple-Morris, L.
Thornton, B.
Tunnicliffe, L.
Wall of New Barnet, B.
Warwick of Undercliffe, B.
Watson of Invergowrie, L.
Whitty, L.
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