Merchant Shipping (Light Dues) (Amendment) Regulations 2009 (SI 2009/1371), etc - Merits of Statutory Instruments Committee Contents

Instruments of interest


4.  The Banking Act 2009 ("the 2009 Act") confers powers on the Bank of England and, in certain circumstances, the Treasury to transfer securities in, and property of, a bank or certain other financial institutions where certain conditions are satisfied. In certain circumstances, the Treasury or the Bank of England may make a transfer of some, but not all, of the property of a failing bank or financial institution ("a partial property transfer"). This draft Order amends the Banking Act 2009 (Restriction of Partial Property Transfers) Order 2009 ("the safeguards order"), the purpose of which is to protect contracts relevant for regulatory capital purposes from disruption under a partial transfer. Following concerns raised by the industry, the Government has been engaging with the industry through the Banking Liaison Panel (BLP), a statutory advisory panel under the 2009 Act. The BLP has provided advice to the Treasury on partial transfers, and although four of its recommendations have been accepted and will be brought into effect by this draft Order, the fifth has not. The Treasury has said that the fifth recommendation, that small companies that are part of larger groups that have a group set-off or netting agreement with the banking institution should receive set-off and netting protection under the safeguards order, is not workable at the current time, but they will ask the BLP to continue to consider this point. The House may wish to satisfy itself that there is now sufficient legal certainty concerning partial transfers despite the Government's decision not to implement the BLP's fifth recommendation at present.


5.  This instrument allows the Legal Services Commission to grant a provisional representation order for publicly funded representation (legal aid) at the investigative stage of a potential serious or complex fraud case. This will allow those under investigation to enter into plea discussions with the prosecutor and facilitate the better management of the case. It will however remain at the Crown Courts' discretion whether the guilty pleas are appropriate and acceptable in each individual case. The Attorney General has issued Guidelines on the cases that may be included in this scheme and how plea discussions are to be conducted[3]. It is a pilot scheme to see whether anticipated benefits and cost efficiencies are produced and will be reviewed before 31 December 2011 when the current Regulations will lapse.


6.  These three affirmative instruments respond to changes made to the original 1990 Act to by the Human Fertilisation and Embryology Act 2008 to reflect recent developments in technology (e.g. cloning) not foreseen in the original legislation. The changes they make are largely consequential but the Committee has been concerned by the way the Department of Health has handled the drafting of the Special Exemption Regulations. The Department has laid three drafts of the instrument in a fortnight. The wording of the earlier versions would not have met the policy intention of requiring the licensing of any process that creates embryos. This defect was also drawn to the Committee's attention by two external correspondents (Dr E Allen, and Ms A Williams of Christian Concern for our Nation). The revised draft appears to broadly meet the concerns expressed. However, the definition is complex and we suggest it should be kept under review to ensure it maintains the policy intention in the light of technological developments. While acknowledging that DH have responded promptly to the points raised, the Committee notes that this sort of drafting error might have been picked up at an earlier stage if the Department had put the proposal out for public consultation. The Committee is also concerned that the Department's quality control system allowed two seriously flawed drafts to leave the Department.


7.  This instrument amends the National Minimum Wage Regulations. Amongst other things, they provide that service charges, tips, gratuities and cover charges paid to a worker though the employer's payroll do not count towards payment of the national minimum wage. The Government conducted a public consultation on this issue. The EM (paragraph 8.3) says that roughly three quarters of the respondents welcomed a change in legislation to prevent service charges, cover charges, tips and gratuities from being used in payment of the national minimum wage. However, what the EM does not say is that approximately half of business representative organisations and trade bodies who responded to the consultation suggested a delay until the economic climate improves (see Government Response to the consultation on the Department for Business, Innovation and Skills website). This represents around one quarter of all the respondents to the consultation. As the Impact Assessment (page 24) says that the increase in labour costs could total £92.5 million per annum, and as the impact will principally be on hotels and restaurants, taxi operations, gambling and betting activities, and hairdressing and other beauty treatments, this change may be of interest to the House.


8.  This Order revokes the Landsbanki Freezing Order 2008 ("the 2008 Order") and the Landsbanki Freezing (Amendment) Order 2008, and therefore lifts the asset freeze which has applied in the UK in relation to the assets of the Icelandic bank, Landsbanki. The Treasury made the 2008 Order after the bank had been placed in receivership in Iceland, and the Icelandic authorities gave no indication of how overseas creditors would be dealt with. The 2008 Order froze the funds and financial assets held by the bank in the UK. The Government has now obtained commitments from the Icelandic authorities that they will honour obligations to depositors under the EC Deposit Guarantee Scheme Directive, which requires EEA Member States to implement arrangements to compensate depositors in the event of a bank failure. In these circumstances, the Government believe it is appropriate to lift the asset freeze. The Order does not comply with the 21 day rule as the Government believe it is desirable to lift the asset freeze sooner given the commitments from the Icelandic authorities.

1 3   See Back

4   Draft Human Fertilisation and Embryology (Appeals) Regulations 2009 and the Draft Human Fertilisation and Embryology (Consequential Amendments and Transitional and Saving Provisions) Order 2009 Back

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