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The Parliamentary Under-Secretary of State, Department for Communities and Local Government & Department for Work and Pensions (Lord McKenzie of Luton): My Lords, yesterday I informed the House that the Boundary Committee has provided its advice on unitary proposals for Devon, Norfolk and Suffolk. Representations can now be made to us about the committee's proposals or the original proposals until 19 January 2010. We will carefully consider the committee's advice, all representations received and all other relevant information, before taking our statutory decisions on whether to implement any unitary proposal.

Baroness Scott of Needham Market: Is the noble Lord aware that the Government's proposals for restructuring these three counties are now in their third year and that the uncertainty has had a severe impact on these councils, particularly their ability to recruit new staff? Given that the Boundary Committee is operating under rules that have been set for it by the Government, under what circumstances would the Government not follow the committee's advice?

Lord McKenzie of Luton: My Lords, throughout the process we have recognised the importance of minimising the continuing period of uncertainty for the councils and the communities involved. As for the second point of the noble Baroness's question, until we have gone through the process of receiving representations on both the original proposals and the Boundary Committee's proposals it is impossible to answer that; indeed I think it would be improper to answer it. We need to have a fair period when those representations can be made, heard and considered.

Earl Cathcart: My Lords, there is no public demand for another bout of expensive, time-consuming and divisive unitary restructuring. It has cost Norfolk councils £2 million so far, and I believe that Cornwall has overspent by about £10 million. So it is the Conservative policy to revoke any such legislation, to ensure that the scarce resources are properly directed to front-line services. Is this not another example of government-botched business?

Lord McKenzie of Luton: That is very much not the case, my Lords. If you want proof of that, look at the unitary authorities that were established in just April of this year and what is happening already. These councils are redesigning services to improve outcomes for local people; they are on track to achieve efficiency savings of over £150 million this year; and they are stripping out duplication and inefficiency, including removing some senior management posts, saving £22 million a year. So the proof is there that unitary authorities can work and do work. If you want the classic case of the challenges of two-tier authorities, you have waste collection at one tier of an authority and waste disposal at the other. What on earth is the sense in that?

Baroness Hollis of Heigham: I declare an interest both as former leader of Norwich City Council and currently as a DL of the county of Norfolk. Does my noble friend accept that the greater Norwich area is currently run by four different local authorities? It is a mess. No one knows who does what, to what standard

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or at what cost, whether they be council tax payer or the business community. Does he agree that focused unitary structures make best sense for cities-not necessarily for rural areas but for cities-on which so much of the counties' and the country's prosperity depends?

Lord McKenzie of Luton:My Lords, I hope my noble friend will forgive me if I do not comment in detail on the specific proposal in the question, but I agree that these issues of leadership, accountability, transparency and duplication of services are what drove the White Paper in 2006. In all of this our priority is to ensure that the people of Devon, Norfolk and Suffolk will have the councils that are best able to play their part at the heart of providing innovative and better value public services across the counties, providing strong strategic leadership, engaging effectively with their most local communities, and delivering efficiencies and service improvement.

Baroness Butler-Sloss: My Lords, speaking as a resident in Devon, is there the slightest possibility of any decision before the next election?

Lord McKenzie of Luton: My Lords, it is important that we try now to make decisions as quickly as possible. In particular, we are very keen to see decisions made before the next election. If they are not and decisions are taken subsequently, it will mean another delay in implementing unitary authorities-if that is the decision after representations have been considered. If we can make decisions before the next election then we have the prospect of any unitary authorities that emerge being in place by April 2011.

Lord Tope: My Lords, have the Government carried out any reviews of the first tranches of local government reorganisation, and if so what lessons have they learnt and what cost-benefit analysis has been done? If such reviews have been carried out, will they publish the results or did they conclude that they wished that they had never started the process?

Lord McKenzie of Luton: My Lords, there are a lot of questions in that supplementary. In terms of reviews, I mentioned a moment ago what has happened to those councils that became unitary in April 2009 and the improvements that are already ensuing. Again as I said previously, what drove the process in the first place were concerns over transparency and particularly over duplication of services in two-tier authorities. It is important that we review the recommendations that come forward and the representations that are made around those proposals. We are dealing here with specific proposals for specific areas.

Lord Stoddart of Swindon: My Lords, does the noble Lord agree that it is essential if you are going to have first-class, independent local authorities, of whatever sort, that they should be properly financed from their own resources? In that regard, would the Government consider returning the business rate to local authorities?

Lord McKenzie of Luton: My Lords, the noble Lord tempts me beyond the scope of this question.

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Lord MacGregor of Pulham Market: My Lords, speaking also as a resident of the county of Norfolk, is it not wholly inappropriate, given the intervention of the Christmas and New Year breaks, to give such a very short time for local authorities to respond on this important issue? It is something like two to three weeks. Will he consider extending the timescale? More importantly, given the late stage of this Parliament and the very considerable widespread opposition in Norfolk to these proposals, is it not absurd to proceed with something with substantial upfront costs in the early years to be implemented in the next Parliament when it may well be reversed in that Parliament?

Lord McKenzie of Luton: My Lords, the question of reversing this in the next Parliament presumes that there might be a change of Administration. Noble Lords would not expect me to accept that. Assuming that the process is completed in this Parliament, it would take primary legislation to reverse the process. In terms of the timescale, there is a requirement to have a six-week period between the Boundary Committee's recommendations and decisions. We are extending that because there is going to be a six-week period for representations. We believe that is fair. There will be some period over Christmas where there will not necessarily be full engagement, but the six-week period is beyond that required by statute.

Baroness Shephard of Northwold: My Lords, the Minister has said that the next period is to be devoted to receiving representations. Can he tell the House from whom he expects to receive representations, since so far the public in these counties has been specifically excluded by the Government?

Lord McKenzie of Luton: My Lords, we have written to chief executives of all the councils involved explaining the process for representations. We expect most representations to come in written form but there are arrangements whereby elected representatives, individually or collectively, can make representations directly to Ministers. I believe there is a fair process for people to be engaged.

Earl Ferrers: My Lords, why have the Government excluded the public?

Lord McKenzie of Luton: My Lords, I would not accept that we have excluded the public from these processes.

Lord Marlesford: My Lords, I declare an interest as chairman of Marlesford parish council in Suffolk. Since no agreement has been reached in Suffolk on the changes that should be made, is this not the moment to apply a principle of good government-if there is no agreement on the changes needed, then rather like in the House of Lords, it is better not to make the changes?

Lord McKenzie of Luton: My Lords, I will not be drawn on the noble Lord's last point. The prospect before the Secretary of State is to accept the original

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proposals with possible modifications, to accept the recommendations of the Boundary Committee with modifications if that is felt to be appropriate, or to do nothing. Those are the three choices that the Secretary of State faces.

Lord Brooke of Sutton Mandeville: My Lords, the Minister believes that the public have not been excluded. In what way were they consulted in Wiltshire?

Lord McKenzie of Luton: My Lords, my brief and the figures set out in it do not cover Wiltshire, but I am happy to write to the noble Lord.

Community Radio (Amendment) Order 2010

Legislative Reform (Insolvency) (Miscellaneous Provisions) Order 2009

Non-Domestic Rating (Chargeable Amounts) (England) Regulations 2009

European Communities (Definition of Treaties) (1996 Hague Convention on Protection of Children etc.) Order 2009

Legislative Reform (Revocation of Prescribed Form of Penalty Notice for Disorderly Behaviour) Order 2009

Motion to Refer to Grand Committee

3.35 pm

Moved By Baroness Royall of Blaisdon

Motion agreed.

Digital Economy Bill [HL]

Order of Consideration Motion

3.35 pm

Moved By Lord Davies of Oldham

Motion agreed.

9 Dec 2009 : Column 1085

Third Parties (Rights against Insurers) Bill [HL]

Main Bill Page
Copy of the Bill
Explanatory Notes

Second Reading

3.36 pm

Moved By Lord Bach

The Parliamentary Under-Secretary of State, Ministry of Justice (Lord Bach): My Lords, the Second Reading Committee considered the Bill in the Moses Room on Monday 7 December and I therefore beg to move this Motion formally.

Bill read a second time and committed to a Special Public Bill Committee.

Bribery Bill [HL]

Main Bill Page
Copy of the Bill
Explanatory Notes

Second Reading

3.37 pm

Moved By Lord Bach

That the Bill be read a second time.

The Parliamentary Under-Secretary of State, Ministry of Justice (Lord Bach): My Lords, it is fitting that we should have the Second Reading of the Bribery Bill on the United Nation's International Anti-Corruption Day. The Government are committed to action to tackle bribery. It is an insidious offence that undermines good governance, distorts competition, saps economic and social development and eats away at the very fabric of democratic society. The impact of bribery in developing countries can be particularly acute. It can add 10 per cent to the cost of doing business in some countries and siphons off billions of pounds of development aid into the pockets of corrupt officials.

We should be proud of the fact that the UK remains largely untainted by the pernicious presence of bribery and of our strong record as a champion of the global fight against corruption. Last month, Transparency International published its corruption perception index for 2009, which ranks 180 countries according to perceived levels of corruption among public officials and politicians. Inevitably, the expenses scandal has not helped our standing in the world, but we need to put that in perspective. The United Kingdom is ranked as the 17th least corrupt country in the world. We are equal third among the G8 countries and equal fourth among the G20. But we can and should do more. Our standing has been higher in recent years, and we need to reassert our position as a leading global champion against corruption. Taking firm action to address the expenses scandal, as we have done through the creation of the new Independent Parliamentary Standards Authority, was one necessary step. The Bill before the House, which will put in place a modern and codified framework of criminal law to tackle bribery in all its manifestations, is another vital step forward.

Before I turn to the detail of the Bill, I want to make one thing absolutely clear to the House. It was evident from some of the remarks made during the debate on the Queen's Speech that there may be some

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misunderstanding on whether the current criminal law on bribery meets the United Kingdom's international obligations. Your Lordships should be in no doubt that, while the existing criminal law is clearly ripe for reform, this country was and is fully compliant with our international obligations.

The issue is not therefore one of compliance or the scope of the existing criminal law, but whether it is wholly fit for purpose. The current law consists of the common law offence of bribery dating back to at least Magna Carta, and various statutory offences, brigaded under the banner of the Prevention of Corruption Acts, enacted in the latter part of the 19th and early 20th century. Given this ancestry, it is not surprising that the Law Commission has described the current law as,

While it has long been recognised that the current law is in need of reform, there has been considerable argument and debate about the form that the new body of criminal offences should take. It is for this reason that it has taken us longer than we would have wished to get to the point when we could introduce a Bribery Bill commanding the necessary widespread support, not just from Members of your Lordships' House and of the other place, but from the business community and non-governmental organisations. That we have been able to reach this position is in no small way thanks to the careful analysis and consideration, first by the Law Commission and, secondly, by the Joint Committee on the draft Bribery Bill, chaired by the noble Viscount, Lord Colville of Culross. I am delighted that he will speak in this debate. Therefore, on behalf of the Government, I record our gratitude to the Law Commission-to its chairman, in particular-and to all the members of the Joint Committee, especially the noble Viscount.

It is a testament to the Joint Committee's cogent analysis that the Government could accept, either wholly or in part, all but one of the committee's 39 conclusions and recommendations. The fact that this Bill has had the benefit of pre-legislative scrutiny does not, of course, mean that your Lordships will not want to scrutinise it in their usual thorough and forensic manner. I trust, however, that we have reached the stage where that examination can be about the finer details of the Bill rather than its core purpose and basic structure.

I now turn to the detail of the Bill. It creates two general offences of bribery, a third specific offence of bribing a foreign public official and finally a new corporate offence of failing to prevent bribery. Let me say a little more about each of these four offences. The general offences, in Clauses 1 and 2, cover on one side of the coin the offer, promise and giving of a financial or other advantage, and on the flip side the request, agreeing to receive or acceptance of such an advantage. These offences focus on the conduct of the payer or the recipient of a bribe and describe six scenarios, each involving the improper performance of a function, where one or other offence would be committed. These new offences will apply to functions of a public nature as well as in a business, professional or employment context.

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Clause 6 introduces a bespoke offence of bribing foreign public officials. As I have already made clear, the absence of such an offence in our current law does not put the United Kingdom in breach of our international obligations. The existing general offences and, for that matter, their replacements in Clauses 1 and 2, cover the territory of the OECD convention, which does not require a separate offence. Indeed, in September last year the City of London Police secured the conviction, under the Prevention of Corruption Act 1906, of a managing director of a Wiltshire-based company in connection with the bribery of a Ugandan Government official. Having said that, we recognise that a bespoke offence would further underline this country's commitment to international efforts to stamp out the particularly insidious practice of bribing foreign public officials, not least because of the devastating impact that such practices can have in developing countries.

This quartet of new offences is completed by the offence of failure by a commercial organisation to prevent bribery. Again, corporate liability for bribery, as with other offences, is an existing feature of our criminal law. But this is another area where there is a compelling case for a bespoke, targeted offence.

One of the core conclusions of the committee chaired by the noble and learned Lord, Lord Woolf-I am delighted that he is speaking in this debate-into the ethical policies and procedures of BAE was the need for a proactive role for a company board in securing and maintaining high standards of ethical business conduct. We agree. But these are matters that are too important to be left to the commercial sector alone. The Law Commission came to the same conclusion.

Clause 7 creates an offence of failing to prevent bribery which can only be committed by a relevant commercial organisation. The clause also provides for a defence for a commercial organisation to show that it had adequate procedures in place to prevent bribery. We recognise that there has been considerable debate about what constitutes "adequate procedures" for these purposes. As we indicated in our response to the Joint Committee, the Government agree that guidance should be made available to commercial organisations. We propose that such guidance should be available well in advance of the new offences coming into force.

Over the coming months we will develop appropriate guidance, drawing on the expertise of business representatives, Transparency International and others. Among other things, we envisage that the guidance will provide illustrative good practice examples of adequate procedures.

While guidance will be in place to assist business, the message from the Bill is clear. The payment of bribes, including facilitation payments, is unlawful. If companies pay them in order to gain a business advantage they run the risk of prosecution. Bribery on any scale cannot and should not be tolerated or condoned.

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