APPENDIX 6: LOCAL TRANSPORT BILL [HL]
— GOVERNMENT AMENDMENTS
Supplementary memorandum by the Department for
Transport
Introduction
1. This memorandum supplements the Memoranda
to the Delegated Powers and Regulatory Reform Committee dated
8th and 29th November 2007 which described provisions for delegated
legislation in the Local Transport Bill (introduced in the House
of Lords on 7th November 2007, published on 8th November 2007
and reprinted as amended in Grand Committee on 18 December 2007).
This memorandum describes some new provisions in amendments to
the Local Transport Bill [HL] which the Government intends to
move on Report. Other amendments also to be moved on Report do
not affect delegated powers.
2. References to clause numbers in this memorandum
are to those clauses in the Bill as amended in Grand Committee.
Provision for Delegated Legislation
Clause 38: Quality contracts: application of
TUPE
3. The effect of clause 38 of the Bill as currently
drafted would be to insert a new section 134B into the Transport
Act 2000 ("TA 2000") to provide that the transfer of
an employee of an existing bus operator to a new employer who
is providing services under a quality contract would be regarded
as a "relevant transfer" for the purposes of the Transfer
of Undertakings (Protection of Employment) Regulations 2006 ("TUPE").
The new section 134B would, however, leave discretion for the
new operator to determine which, if any, of the existing operator's
staff he wanted to employ and who would therefore transfer.
4. The Government agreed to review this provision
in the light of points raised in Grand Committee: in particular,
the view that the provisions could usefully go further in providing
greater certainty for all the employees of a bus operator
who may be affected by the award of a quality contract.
5. Following further consideration the Government
has concluded that the scope of this provision should be extended,
and is tabling an appropriate amendment to be moved at Report
stage. The effect of that amendment would be to provide that where,
as a result of the making of a quality contracts scheme, one operator
must cease to provide local bus services and services are instead
provided by another person under a quality contract, that is to
be treated as a relevant transfer for the purposes of TUPE.
6. The application of the TUPE provisions following
the making of a quality contracts scheme could be complex. The
new network of services may look very different from the old one,
and it may not always be obvious to which new employer employees
should transfer.
7. Because of these potential complexities, the
amendment would provide a power for the Secretary of State to
make secondary legislation prescribing the process for the determination
of staff transfers and in particular, at a local level, which
staff should be associated with which new contract. This would
not be a power for the local authority to determine whether or
not TUPE should apply in the case of a particular scheme - that
would be determined by the primary legislation. The regulations
would instead prescribe the logistics of deciding which staff
should go where.
8. The Department has considered whether such
details could be included on the face of the Bill, but has concluded
that that would not be appropriate for two reasons. First, these
are essentially procedural matters and the regulations would prescribe
the process which a local transport authority, in discussions
with employers, trades union representatives, and affected staff
would need to follow as part of the making and implementation
of a quality contracts scheme. Secondly, the process is likely
to be complex and the Department considers that further discussions
with interested parties - in particular those local authorities
who are considering whether quality contracts schemes might be
appropriate in their areas - would enable better-quality legislation
to be prepared. It may also be the case that the process would
need to be amended in the future, if experience dictates that
minor adjustments might be necessary. This would be more easily
achieved if the provisions are in secondary, rather than primary,
legislation.
9. The provisions in Part 2 of the TA 2000 about
quality contracts schemes include a number of powers to prescribe
procedural matters in secondary legislation (see section 133 of
that Act as would be amended by the clause 35 of the Bill). By
virtue of section 160 of the TA 2000, such regulations are subject
to the negative resolution procedure. Consistent with this, the
Department proposes that these new regulation-making powers should
also be subject to that negative procedure.
Clauses 65 and 66: Passenger Representation
New clause to be inserted after clause 66:
Power to require the display of certain information
10. The Government considers that the interests
of bus passengers should be more strongly represented, and a consultation
paper entitled Options for strengthening bus passenger representation
was issued shortly after publication of the Bill. This consultation
set out a number of options for providing a stronger "voice"
for passengers, and will run until March 2008. The provisions
contained in clauses 65 and 66 of the Bill allow a degree of flexibility
in order to accommodate a range of different possible outcomes
from the consultation process.
Additional powers in clauses 65 and 66
11. During Grand Committee the Department agreed
to consider amendments aimed at ensuring that any statutory Public
Transport Users' Committee established under clause 65 of the
Bill would have the power to make representations about bus services
to appropriate persons, such as traffic commissioners, local authorities
and bus operators, and that such persons would be under an obligation
to have regard to such representations.
12. Having considered the issues further, the
Government is tabling amendments to clauses 65 and 66 which would
enable the Secretary of State, by order, to place obligations
on certain persons to take specified actions where representations
are made to them by the Passenger Transport Users' Committee (or
by the Rail Passengers' Council, as the case may be). The Government
envisages that the power could be used to require parties such
as those mentioned in paragraph 11 above to consider and perhaps
formally respond to representations made by the passenger representative
body.
13. Consistent with the order-making powers already
inserted into the Transport Act 1985 ("TA 1985") by
clauses 65 and 66, the new provisions would also be subject to
the affirmative resolution procedure. The power under the proposed
new section 125C, which would be inserted into the TA 1985 by
the amended clause 65, includes a power to amend, repeal or revoke
any provision of an enactment (whenever made or passed) conferring
functions on the relevant person or body. This is necessary to
cater for the possibility that the order-making power might be
exercised some time into the future, by which time other relevant
enactments might have been made or passed. The reasoning here
is the same as for other powers in clauses 65 and 66, which also
extend to the amendment etc. of future enactments (see the Government's
response to the Committee's First Report of Session 2007-08, dated
30th November).
Delegated power in new clause proposed to be
inserted after clause 66
14. Another issue which the Government agreed
to consider during Grand Committee related to the display of information
about passenger representative bodies on public transport vehicles
and at locations such as bus stations. The Government agrees that
it might be appropriate to require such information to be visible
so that passengers know whom they can contact if they have a complaint
about the service that they have received. The Government believes
that the power to require providers of services to display such
information might be relevant in respect of existing non-statutory
bodies, as well as in respect of any statutory body which might
be established in future under powers in this Bill. The power
would also be wide enough to require more general passenger information
details to be displayed such as an operator's own customer service
contacts or public transport information services (like Traveline
or Transport Direct).
15. The proposed new clause would empower the
appropriate national authority (the Secretary of State in England
and the Welsh Ministers in Wales) to place obligations on prescribed
persons to display appropriate information. The provision would
enable the appropriate national authority to prescribe, in regulations,
financial penalties that may be imposed by the traffic commissioners
where operators of public service vehicles failed to meet the
prescribed obligations.
16. Traffic commissioners can already take enforcement
action against the operators of public service vehicles in prescribed
circumstances (see section 155 of the TA 2000), and this proposal
is similar in approach. As under section 155, the maximum level
of the fine could be prescribed in regulations and the traffic
commissioner would have discretion, on a case by case basis, to
determine the level of fine to be imposed. A right of appeal against
the imposition of a fine would lie to the Transport Tribunal.
This is consistent with other appeal rights against decisions
of traffic commissioners.
17. As explained in paragraph 10 above, decisions
about the form and structure of any future passenger representative
body have not yet been made. Taking a power to prescribe requirements
about the display of information would provide the Department
with sufficient flexibility to ensure that the provisions accurately
reflect the future structure of passenger representative bodies.
It would also provide more opportunity for consultation with interested
parties, including in particular any new statutory passenger representative
body, about the details to be included in the regulations.
18. There is a precedent for using secondary
legislation to prescribe details about information to be displayed
on public service vehicles which is to be found in section 60(1)(f)
of the Public Passenger Vehicles Act 1981. The Department considered
whether this power was wide enough to make the provisions described
in this memorandum, but concluded that it was not (not least because
that power is available only for the bringing into effect of the
PPVA 1981, with which these new provisions are not connected).
19. Regulations made under this provision would
be mainly of a procedural nature. For this reason, and consistent
with the power described in paragraph 18 above, such regulations
would be subject to the negative resolution procedure.
Clause 75: delegation of local authority functions
20. Clause 75 of the Local Transport Bill enables
the Secretary of State to make an Order delegating any function
of a local authority to an ITA or eligible local transport authority,
subject to the conditions set out in clause 75(1), and to the
affirmative resolution procedure in both Houses of Parliament
as set out in clause 82.
21. "Local authority" for these purposes
is defined in clause 75(3). It includes a county council, a metropolitan
district council, and a non-metropolitan district council for
an area for which there is no county council. The government is
tabling an amendment which would provide that the power of delegation
in clause 75 will apply to the functions of all district councils,
and will therefore apply additionally to the functions of a non-metropolitan
district council for an area for which there is a county council.
22. The purpose of this change is to ensure that
a local authority function (such as taxi licensing under the Transport
Act 1985) can be delegated to an ITA in relation to any local
authority area within the area of the ITA, whether from a district
in a metropolitan county, from an area with a unitary authority,
or from an area in a non-metropolitan county which does not have
a unitary local authority.
Department for Transport
January 2008
Second supplementary memorandum by the Department
for Transport
Introduction
1. This memorandum supplements the Memoranda
to the Delegated Powers and Regulatory Reform Committee dated
8th and 29th November 2007, and 9th January 2008, which described
provisions for delegated legislation in the Local Transport Bill
[HL] (introduced on 7th November 2007, published on 8th November
2007 and subsequently reprinted on 18 December 2007 and 17th January
2008). This memorandum describes one further provision in an amendment
to the Local Transport Bill [HL] which the Government intends
to move on Third Reading in the House of Lords.
2. References to clause numbers in this memorandum
are to those clauses in the Bill as amended on Report.
Provision for Delegated Legislation
Clause 115: Provision concerning the notification
to an appropriate traffic commissioner of the use of a vehicle
subject to operator licensing rules
3. On Report in the House of Lords a Government
amendment inserted a new clause 115, which would amend existing
provisions relating to goods vehicles operator licensing. The
effect of Clause 115 would be to provide flexibility as to whether
or not a fee should be charged when a goods vehicle operator notifies
the appropriate traffic commissioner that a vehicle has been added
to an operator licence. This remedies inflexibility in the current
legislation, which could have impeded the Government's fee simplification
proposals for operator licensing. There are already delegated
powers to prescribe operator licence fees and Clause 115 as inserted
in Report did not propose any new delegated power.
4. The Government proposes to amend Clause 115
at Third Reading by replacing subsection (2) of Clause 115. Subsection
(2) amends section 263 of the Transport Act 2000 ("TA 2000"),
which itself amends section 5(6) of the Goods Vehicles (Licensing
of Operators) Act 1995 ("the 1995 Act").
5. The effect of the further amendment to be
moved at Third Reading would be to amend section 5(6) of the 1995
Act so as to enable the Secretary of State to prescribe, in regulations,
the timescale within which a goods vehicle operator is required
to notify the appropriate traffic commissioner of a new vehicle
to be used under that operator's licence.
6. Section 5(6) of the 1995 Act requires the
registration numbers of every vehicle used by a goods vehicle
operator to be specified on that operator's licence. This is primarily
to aid roadside vehicle enforcement by the Vehicle and Operator
Services Agency ("VOSA") and the police. However, when
a goods operator adds a new vehicle to their fleet, the existing
legislation provides a one-month grace period before that information
must be specified on the operator's licence - to aid operational
flexibility. This is called the 'margin concession'.
7. The Government decided that it wanted to abolish
the 'margin' - primarily to improve roadside enforcement as it
can be difficult for VOSA and the police to determine who the
operator of a vehicle is when it is being used under the 'margin'.
In order to make legislative provision for this policy, section
263 of the TA 2000 introduced an amendment to section 5(6) of
the 1995 Act to abolish the margin. This provision has yet to
be commenced. DfT issued a public consultation (Modernising Operator
Licensing) in December 2005 that, amongst other things, proposed
to commence s.263 and abolish the current 'margin concession',
as it was felt that modern database and enforcement methods together
with the prospect of online vehicle notification and fee payment
were maturing such that it would no longer be needed by industry.
Instant notification was seen as a real prospect.
8. However, responses to consultation showed
that abolition of the margin concession could impose a much higher
burden on the industry than originally thought. This is primarily
due to the level of short-term vehicle hiring that goes on in
the haulage industry. If the margin concession were abolished,
operators would need to specify every vehicle on their licence
as soon as they started using it - even if it was on hire for
only part of one day. VOSA has also expressed concern that their administrative
systems would struggle to cope with the workload associated
with immediate notification without substantial expenditure,
which would have cost implications for the industry. Therefore,
as part of the Ministerial announcement on the outcome of the
consultation in December 2006, DfT proposed to carry out further
work to evaluate the costs and benefits of this proposal before
making a decision. This would include looking at options for minimising
the burden of an immediate notification requirement.
9. Subsequent discussions with the industry and
VOSA suggest that reducing the 'margin' from one month to, say,
2-3 days may offer a suitable compromise between the need to improve
enforcement whilst at the same time minimising the additional
burden of notification on the industry.
10. The Department has considered whether a specific
timescale for notification could be specified in primary legislation
but has concluded that that would not be appropriate for two reasons.
Firstly, these are essentially procedural matters. There are already
wide regulation-making powers within the 1995 Act. These include
a power to prescribe by regulations the notification to a traffic
commissioner of a vehicle which has ceased to be used.
The absence of a power to prescribe by regulations the notification
of a vehicle which is about to be used is anomalous and
creates an unnecessary inflexibility.
11. Secondly, the process of deciding the best
timescale and whether different rules should apply to different
circumstances, is not yet concluded and the Department considers
that further discussions with interested parties - in particular
industry and those concerned with enforcement, would enable better-quality
legislation to be prepared. It may also be the case that the process
would need to be amended in the future, if experience or developments
in on-line services mean that minor adjustments might be necessary
or desirable. Indeed, the long term aim of ensuring notification
is as prompt as reasonably possible, would be more easily achieved
if the provisions are in secondary, rather than primary, legislation.
The Government could, for example, replace the one month margin
with a shorter period of, say, three days, in primary legislation
based on what is currently workable. However, this may become
an excessive timescale in the future, when electronic notification,
involving operators and even hire companies, might be more sophisticated
and universal. Indeed, DfT has not entirely ruled out the possibility
of maintaining instant notification, as provided for in the TA
2000, if the current obstacles can be overcome.
12. The amendment to clause 115 has therefore
been drafted in such a way that:
- the power to prescribe a notification
period is restricted to a maximum period of one month;
- the new subsection (6A) of the 1995 Act would
work to either require instant notification, or a period of grace
up to one month;
- since section 57(7)(a) of the 1995 Act allows
regulations made under that Act to make different provision for
different cases or classes of cases or different circumstances,
any relevant day, as prescribed, could make different provisions
for different circumstances.
13. Section 57 of the 1995 Act makes provision
in respect of regulations and orders made under that Act. Subsection
(11) provides that any regulations made under that Act, other
than regulations made under section 30(3) (periods of review for
operating centres), are subject to the negative resolution procedure.
Regulations made under the new section 5(6) of that Act, as would
be inserted by the amendment section 263 of the TA 2000 would,
therefore, also be subject to the negative resolution procedure.
The primary legislation, as would be amended by clause 115, already
sets a maximum period of time for the margin. If a margin is to
be prescribed within that maximum period, the Department believes
it to be appropriate that such regulations should be subject to
the negative resolution procedure.
Department for Transport
January 2008
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