On Question, amendment agreed to.
Clause 42 [Discretionary requirements: procedure]:
The Deputy Speaker: My Lords, we now return to Amendment No. 65A, to which the noble Lord, Lord De Mauley, has spoken but which he has not formally moved. I assume that the noble Lord would like to move it formally.
Viscount Bledisloe: My Lords—
The Deputy Speaker: My Lords, I must first call the amendment. It is in order for the House to debate Amendment No. 65A.
Lord De Mauley moved Amendment No. 65A:
The noble Lord said: I beg to move.
Viscount Bledisloe: My Lords, I cannot ask a question, so I suppose I will now have to speak.
I fully understand the purpose of Amendment No. 65A, and I entirely agree that the regulator himself cannot be the proper person to receive and decide on these representations. He has already decided that an offence has been committed, which is why he has instituted the proceedings. But I do not understand why the noble Lord seeks to include this independent person in Clause 42(2)(b). When the representations have been received, under Clause 42(2)(c) the regulator has to decide,
or whatever. There is no amendment to remove the regulator from that. The independent person receives these representations. He presumably then puts them in his file and the regulator goes back to deciding whether the offence is proved and what penalty is to be imposed. Am I missing something? Has the noble Lord failed to carry his amendment to its full conclusion in the remainder of this part of the Bill?
Lord De Mauley: My Lords, I suspect that the noble Lord is right. I apologise; the principle of independence was the point that I was particularly trying to make. I look forward to the Minister’s response on that.
Viscount Bledisloe: My Lords, is the noble Lord saying that if his amendment is passed, he will carry it through into the remainder of the section, because otherwise it is pointless? Is the noble Lord undertaking that if Amendment No. 65A is passed, he will come back at the next stage and remove the regulator and insert the independent person into paragraph (c) and the rest of the section? That is all I am asking.
Lord De Mauley: Yes, my Lords.
Baroness Vadera: My Lords, I believe that I am responding to Amendment No. 65A, which I understand covers the same ground as Amendment No. 143 that we debated in Grand Committee. I am grateful to the noble Lord for clarifying the intentions behind his amendment but I confess that I still lack understanding about who this independent arbiter would be that would hear the representations made by a business, or what powers it would have. For example, would the person be fully independent, such as the judicial person suggested by the noble Lord, Lord Cope?
If the amendment seeks to introduce a truly independent arbiter, external to the regulator, we would strongly disagree with such an aim. This would replicate the existing criminal system, which we are trying to provide an alternative for in certain circumstances by requiring some form of substitute judge to determine whether a sanction may be imposed. The amendment is unnecessary given that the Bill already provides for there to be a right of appeal of the final decision to an independent and impartial tribunal. It would create two rights to have your case heard by two different judicial persons, both before and after a sanction was imposed. If we could figure out how such a body or person could be created, this would add a further level
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The noble Lord suggested that the amendment was designed to ensure that decisions to impose a sanction are rigorously reviewed and challenged within a regulator before a final notice is issued. We would have considerable sympathy with that. Professor Macrory explored such matters in his final report and suggested different ways in which regulators could take decisions on penalties which would ensure quality and consistency. For example, the final decision to impose a penalty could be taken at a more senior level of the regulator’s organisation than that of the person who issued the notice of intent. The noble Lord, Lord De Mauley, provided an example of local authorities in that regard. Professor Macrory also suggested that training and monitoring can play important roles in ensuring quality and consistency.
We believe that such matters should not be in the Bill and are better dealt with through guidance. We are prepared to amend the guide to the Bill to make more explicit how regulators can safeguard the quality and consistency of their sanctioning decisions by, for example, requiring that senior officers, independent of the initial regulatory officer, take final decisions. I hope that what I have said has reassured the noble Lord and that he feels able to withdraw Amendment No. 65A.
I would like to speak also to government Amendments Nos. 67 and 68. Amendment No. 67 proposes making the undertakings provision at Clause 42(5) compulsory. This will mean that a regulator must allow the business the opportunity to offer undertakings in order to mitigate a discretionary requirement. This issue was raised in Committee by the noble Baroness, Lady Wilcox, on behalf of the noble and learned Lord, Lord Lyell. We promised to consider the proposal and, on reflection, are very happy to make undertakings a mandatory part of the discretionary requirements provision. We have tabled a further amendment, Amendment No. 68, to clarify, that while the regulator must allow the business the opportunity to offer undertakings, the regulator does not have to accept the undertakings.
Lord Lyell of Markyate: My Lords, I am most grateful for what the noble Baroness has just said about Amendments Nos. 67 and 68. I am sure that, as far as it goes, the Government—
Lord Bach: My Lords, I am sure that the noble and learned Lord is going to ask a question for elucidation only. The Minister has spoken on this group now, and there can only be questions for elucidation after the Minister has spoken. Noble Lords cannot make further speeches.
Lord Lyell of Markyate: My Lords—
Viscount Bledisloe: My Lords, the noble Lord cannot be saying that. The Minister can move all the amendments in a group. When she has spoken to them, other Members can speak to them. She cannot wait until the end of the debate and then say, “By the way I want to move some other amendments, but you cannot speak to them because we are on Report and you can only ask questions for elucidation”. This is making a farce of these farcical proceedings.
Lord Bach: My Lords, when we reach Amendments Nos. 67 and 68 in the name of my noble friend, she will move them, and then anyone who wishes to speak to them can rise. At this stage, after the Minister has spoken to the opposition amendments, the conventions make it quite clear that all that is allowed are questions for elucidation on the group. When Amendment No. 67 is moved, as many noble Lords as want to can speak to it before it is voted on.
Lord Lyell of Markyate: My Lords, I confess that I am further confused, and I really question whether the noble Lord, Lord Bach, has got this right. Does not the same thing apply to a Minister as applies to any Member of this House? The Minister was not asking elucidating questions about Amendments Nos. 67 and 68—
Lord Bach: My Lords, I remind the noble and learned Lord of the rules of debate on Report:
“On report no Member may speak more than once to an amendment, except the mover of the amendment in reply or a Member or who has obtained leave of the House, which may only be granted to … a Member to explain himself in some material point of his speech, no new matter being introduced … the Lord in charge of the bill; and … a minister of the Crown … Only the mover of an amendment or the Lord in charge of the bill speaks after the minister on report except for short questions of elucidation to the minister or where the minister speaks early to assist the House in debate”.
That could not be much clearer.
Lord Lyell of Markyate: My Lords, I am sorry; I may have been wrong. But suppose the Minister moves an amendment; are Members of the House not allowed to speak to it as well as ask elucidating questions?
Lord Bach: My Lords, of course they are, when that amendment is reached. That amendment has not been reached yet.
Baroness Anelay of St Johns: My Lords, I think that the noble Lord, Lord Bach, is trying to assist my noble and learned friend by explaining that, on this occasion, when the Minister moves the amendments to which my noble and learned friend wishes to allude—that will not be at this minute but in a little while—he will have full opportunity to respond. It is merely the case that we have not reached those amendments yet. It was important that the noble Lord, Lord Bach, put on the record the guidance in the Companion.
My noble and learned friend asked proper questions about whether there is a difference between the rules
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Lord Lyell of Markyate: My Lords, I simply say that, if I have erred, I apologise. I am most grateful to the noble Lord, Lord Bach, and my noble friend Lady Anelay, for the elucidation. I shall wait my turn.
Lord De Mauley: My Lords, in respect of Amendment No. 65A—I think that it is the amendment we are debating—the noble Baroness offered some redrafting in the guide. It does not go as far as I would have liked, but that is as far as I should like to go this evening, so I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 66 not moved.]
Baroness Vadera moved Amendment No. 67:
The noble Baroness said: My Lords, I beg to move.
Lord Lyell of Markyate: My Lords, although the noble Baroness has spoken to the amendment and presumably does not intend to speak further to it, I think that this is the moment for me to speak. Once again I say that I am grateful, in the context of what the Government seek to do, that a potential defendant—an alleged wrongdoer—has an opportunity to come forward and make an undertaking. He must be given such an opportunity. That is wise. It fits in well with the way that I want the Bill to work. Those of us who are worried about the enormous incursions into our legal procedures that the Bill represents will welcome it. In the discussions that take place before Third Reading that the noble Baroness has kindly offered, we will focus on whether all this can be done under exactly the existing system, among other things. I gave the example of how the Statistics Board was successful, occasionally by twisting people’s arms by issuing a summons, in reaching an accommodation with 73 out of 90 people and having to prosecute only 17, and getting 17 convictions. The present system works much better.
The House will remember that Professor Macrory, whose name has much been relied on this evening, says that there are many areas in which the regulatory system works perfectly well. He also says that, when he spoke to regulators, he found it difficult to get any of them to tell him where it was not working well; I gave chapter and verse—the page reference—when I last mentioned that. There is a great notion that it is not working well, but evidence has not been forthcoming from Professor Macrory, who is much
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Lord Bach: My Lords, I was not pointing to the noble and learned Lord; I was wondering whether the clock was on. It was nothing to do with him and I am sorry to have put him off.
Lord Lyell of Markyate: My Lords, as I look at the board I see that it is a zero-sum result, whatever that means.
There are many sensible ways in which the Government can achieve what they wish in a way that will have my support, with more subtle use of the legislative programme and less sweeping changes. I hope that in due course the Government will agree to that or, if not, give the House an opportunity to express an opinion about it.
Lord Borrie: My Lords, the noble and learned Lord is absolutely right to say that the role of Professor Macrory lies behind the various proposals in the Bill. He was an academic brought in to discuss various alternative sanctions to criminal prosecution. The noble and learned Lord is absolutely right to say that Professor Macrory recognised the merits, over the years, of criminal prosecution. And of course, the noble and learned Lord said just now, and at greater length earlier, that it has always been the case—he quoted the former Attorney-General Shawcross, who held the same office as the noble and learned Lord—that there is discretion as to whether a prosecution should be brought.
However, surely what the Government had to do on receiving the Macrory proposals was to put them into legislative form—it was not Macrory’s job to do that—and to lay out alternative ways of dealing with some problems that might not deserve criminal prosecution and all that that means in terms of the stigma and procedure involved. The Government, since they first introduced the Bill, including in the amendments we are discussing, have been prepared to make amendments, some of them as a result of points made in this House and Grand Committee.
Surely, it is perfectly understood by everyone, including the Government that the role of Macrory was different from that of the Government in producing a detailed Bill. Unlike Ministers and their officials, Macrory does not have to go through the procedure of considering amendments and carefully seeing whether some of them can be accepted. They
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I understand that the noble and learned Lord is resolutely against the Bill, but it is not really necessary to produce one amendment after another in order to demonstrate that.
Baroness Vadera: My Lords, finally, I turn to Amendment No. 69. I thank the noble Lord, Lord De Mauley for tabling it and I wish to restate the Government’s case. The new sanctions are an alternative to criminal prosecution and will be imposed by a regulator only when he is satisfied beyond reasonable doubt, which is a criminal standard of proof, that a criminal offence has been committed. The regulator will have undertaken a thorough and rigorous investigation and at the end of that process will have determined that a person is liable for the offence. That person then has a right of appeal to an independent tribunal. In such circumstances it cannot be for a person or a business to decide how it should be punished.
In particular, allowing a person to choose would leave the system open to abuse. They could, for example, attempt to delay the enforcement process by opting for a criminal prosecution and requiring the regulator to undergo another process of setting out its case and presenting all its evidence before a court. Allowing a person to choose to go down the route of criminal prosecution would also go against another of the fundamental tenets of what we are attempting to achieve, which is a proportionate sanctioning regime, whereby criminal prosecution should be reserved for the most serious cases. Indeed, that has to be decided by the regulator, in view of all the cases before it. The choice between civil and criminal sanctions must remain at the discretion of the regulator and not the offender.
On the first day of Report, the noble and learned Lord, Lord Lyell, asked what principles would determine whether a civil or criminal sanction was pursued by the regulator. It may be helpful if I give some examples. They include the seriousness of the conduct and whether malicious intent or gross negligence is involved. The regulator may also take account of the extent of harm that the conduct has caused—for example, whether there have been a large number of victims of the regulatory non-compliance.
The regulator is required by Clause 63 to give public guidance in its enforcement policy as to the circumstances in which it is likely to pursue a criminal or civil sanction. The regulated community will be well aware of the kind of factors that will be taken into account.
As we said in Committee, we understand the concerns that noble Lords have had about the new sanctioning
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