Lord McNally: Half my remarks were made on notes that were there. The noble and learned Lord has now pressed for two full debates on whether “flexible” and “part-time” are interchangeable or whether one over-rides the other. I and the noble Lord, Lord Beecham, in an act of unity, having tried to explain—there is nothing in the brief on it—I continue to puzzle about why the noble and learned Lord cannot see the interchangeability of the two. I have also got his note, the billet-doux he left me last night, which further

4 Dec 2012 : Column 579

pressed the case, but a large number of people, whose opinions I express, do not find the confusion that he does about the two terms.

Lord Lloyd of Berwick: All I can say by way of reply is that nobody except the Minister and the noble Lord, Lord Beecham, regards flexible and part-time work as being interchangeable. They clearly are not. One is one thing and one is another. If the Bill were to take effect, one would have to calculate at some point how many part-time members, as it were, occupy the time of the Supreme Court, and how many full-time members. The thing is simply impractical on the basis of salaried part-time members who would be paid less than full-time members. Those are simply the financial impracticabilities, but there are also all the other impracticabilities that have been pointed out by other Members who have spoken. It would simply be, as has been said more than once, a nightmare to work out in practice. It would raise expectations which I suspect that we all know would never be fulfilled.

It would be so easy for the Minister, consequent on all the things that were said in Committee as well as by other speakers today, to substitute “flexibility” for “part-time” working. Then we would all agree. The suggestion made that these are two ways of looking at the same thing, in my respectful submission, simply makes no sense. But obviously I am not going to persuade the Minister, and I suspect that the Opposition will take the view that they have indicated that they will take. I regret it very much. However, for the reasons that I have tried to give, I seek the opinion of the House.

Amendment 82A negatived.

Amendment 82B

Moved by Lord Ahmad of Wimbledon

82B: Clause 18, page 17, line 15, after “offices,” insert—

“Part 4A makes provision for the exercise of certain functions where the Master of the Rolls, the President of the Queen’s Bench Division, the President of the Family Division or the Chancellor of the High Court is incapable of exercising the functions or one of those offices is vacant,”

Lord Ahmad of Wimbledon: My Lords, this group of amendments makes a number of technical amendments to the judicial appointment and diversity provisions. I will touch only on those amendments which make a substantial change.

In Committee, the noble and learned Lord, Lord Falconer, highlighted that the drafting of the Bill would allow for the number of judicial appointments commissioners who are appointed by virtue of holding a judicial office to be equal to the number of other commissioners. Our intention was to retain the current position whereby the judicial members are in the minority on the commission, and Amendment 87 ensures that is the case. This will guard against any perception of judicial office holders appointing in their own image; it will not affect the current position, whereby commissioners appointed other than as a judicial member—for example,

4 Dec 2012 : Column 580

legal professional members—may also hold judicial office without counting towards the number of judicial members.

Amendment 89 transfers the power to appoint persons as magistrates from the Lord Chancellor to the Lord Chief Justice, although as with the current position the appointment will be made in the name of Her Majesty The Queen. This is entirely in line with other provisions in the Bill which transfer responsibility for approving Judicial Appointments Commission selections, and in some cases making appointments from the Lord Chancellor to the Lord Chief Justice for certain judicial offices below the level of the High Court. This proposal was not included in the Bill on introduction, as consultation with magistrates’ representatives was still taking place at that time.

Amendments 86 and 94 allow the regulations setting out the appointment process for Supreme Court and other judicial offices to set aside, for limited purposes, the usual arrangements for when the office of Lord Chief Justice is vacant or the post holder is incapacitated. Section 16 of the Constitutional Reform Act provides for the senior head of division to carry out the functions of the Lord Chief Justice in these circumstances. However, in relation to the functions of the Lord Chief Justice as a member of a selection commission and selection panel, or his functions in nominating other members of such commissions or panels, it may not always be appropriate for the senior head of division to assume such functions. For example if the appointment in question is to fill a vacancy in one of the offices of head of division, it may not be appropriate for a head of division to be given a role on the selection panel. The Constitutional Reform Act currently recognises this by allowing for a Supreme Court judge to deputise for the Lord Chief Justice in these circumstances. These amendments ensure that the regulations will be able to make similar provisions in future.

Amendment 95 requires the Lord Chancellor to secure the concurrence of the Lord Chief Justice before issuing any guidance to the Judicial Appointments Commission under Section 65 of the Constitutional Reform Act 2005. This reflects the increased partnership role that the Lord Chief Justice and Lord Chancellor have in the appointment process. It is also consistent with the approach that we have taken in relation to requiring the Lord Chief Justice’s agreement to our new regulations on the appointment process.

Amendments 82B and 103A provide a new power enabling the Lord Chief Justice, with the concurrence of the Lord Chancellor, to temporarily appoint a judge of the senior courts to carry out the statutory functions of a head of division when that head of division is either incapacitated or the office is vacant. The heads of division—namely, the Master of the Rolls, the president of the Queen’s Bench Division, the president of the Family Division and the Chancellor of the High Court—have a range of statutory powers and functions, but there is no corresponding power enabling the exercise of such functions when the relevant head of division is incapacitated or the office is vacant. This has proved problematic operationally, as it has meant that important decisions cannot be taken if the incumbent is unwell or the office is vacant and a new head of division has yet to be appointed.

4 Dec 2012 : Column 581

These amendments will ensure that we can maintain business continuity and that courts can operate effectively in such circumstances. In addition to these amendments, a number of drafting and technical amendments have also been made. Noble Lords will also be aware that the Bill provides for various detailed elements of the appointment process to be removed from primary legislation and provides for new regulation-making powers in these areas. I should use this opportunity to draw noble Lords’ attention to the three sets of draft regulations that I have recently shared with Parliament. These have been produced in order to inform our debates. However, I would like to stress that these drafts are indicative and will be subject to change, but I hope that they are helpful in providing greater information to the House about our intentions in this area. I beg to move.

5.45 pm

Lord Beecham: My Lords, I very much welcome the Government’s changes to their original plans, in particular in relation to the role of the Lord Chancellor, dealing with points that have been raised in Committee and by the Constitution Committee. I am glad that the Government have seen sense on those matters, if I may say so, and adopted the recommendations, and equally that they have responded to the points made by my noble and learned friend Lord Falconer in relation to the composition of the Judicial Appointments Commission. In all fairness to the Government, I think that it was a slip rather than a deliberate drafting decision that gave rise to that issue.

In relation to the judicial appointments magistrates, I am very happy that the Government have delegated this responsibility to the Lord Chief Justice, thereby removing any shadow of political or executive responsibility for that appointment. At a later point this evening, we will discuss further the issue of magistrates’ courts, although not in that context of the question of appointments. But to foreshadow some elements of that debate, there is a concern about the composition of the magistracy to which the later amendment refers, and I hope that the Lord Chief Justice will be in a position to respond to those concerns. The Opposition certainly welcome the delegation of that responsibility to him.

Equally, we support the minor amendments to which the Minister referred. On this occasion, having complained earlier about the lack of sight of draft regulations, I ought to thank and congratulate the Government on producing such documents, although it has to be noted that they are pretty anodyne, and perhaps the more difficult things are not as likely to appear in as timely a fashion. Nevertheless, it is a precedent that we welcome and very much hope to see followed, as we come on to perhaps rather more difficult matters. Having said that, we support these amendments and thank the Government for proposing them.

Amendment 82B agreed.

Schedule 12 : Judicial appointments

Amendment 82C not moved.

4 Dec 2012 : Column 582

Amendments 83 to 86

Moved by Lord Taylor of Holbeach

83: Schedule 12, page 194, leave out line 12 and insert “and”

84: Schedule 12, page 194, leave out lines 14 and 15

85: Schedule 12, page 195, line 7, leave out from “entitled” to “to” in line 9

86: Schedule 12, page 195, line 14, at end insert—

“( ) provide for section 16(2)(a) or (b) not to apply in relation to functions of the Lord Chief Justice—

(i) as a member of a selection commission (including functions of chairing a selection commission), or

(ii) in relation to the nomination or appointment of members of a selection commission;”

Amendments 83 to 86 agreed.

Amendment 86A

Moved by Lord Marks of Henley-on-Thames

86A: Schedule 12, page 198, line 3, at end insert—

“Encouragement of diversity in appointments to the Supreme Court

(1) Part 3 of the Constitutional Reform Act 2005 is amended as follows.

(2) After section 31, insert—

“31A Diversity

The Lord Chancellor and any selection commission convened under section 26 must, in performing their functions under sections 27 to 31, have regard to the need to encourage diversity in the range of persons available for selection for appointments.””

Lord Marks of Henley-on-Thames: My Lords, as everyone in this House recognises, our judges are widely respected nationally and internationally, for their fairness and impartiality, their integrity, honesty and incorruptibility, their intellectual rigour and their willingness to innovate in the development of our law. But we should not let our pride in the strengths of our judiciary beguile us into complacency about its weaknesses, because the reality is that for all its strengths, the judiciary is overwhelmingly too white, too male and too middle class to be representative of the society it serves. That leads to our judges being perceived as out of sympathy with contemporary Britain and overwhelmingly old-fashioned and out of touch, however far that may be from the truth in respect of individual judges.

It is nearly three years since the Advisory Panel on Judicial Diversity, chaired by the noble Baroness, Lady Neuberger—whom I am delighted to see in her place today—reported in February 2010. We have just had the second report of the Judicial Diversity Taskforce, which records the practical steps taken since the publication of her report. There is no lack of expressed commitment to achieving more diversity, but there is still little sense of real progress being made. Both my noble friend the Minister and my right honourable and learned friend Ken Clarke, when Lord Chancellor, have publicly accepted as much in the recent past. As we heard in a previous debate, your Lordships’

4 Dec 2012 : Column 583

Constitution Committee produced a report on this subject in March this year. The Committee pointed out then that:

“Only one in 20 judges is non-white and fewer than one in four is female”,

and expressed the strong view that,

“this disparity is undermining the public's confidence in the courts”.

We have made some progress. In 1998, only 10.3% of judges across the board were women and 1.6 % were black, Asian or from ethnic minorities. By 2011, those figures had risen to 22.3% and 5.1% respectively. But they are still a mile away from being representative of the nation as a whole. We still have only one woman Supreme Court judge out of 12; four women out of 37 judges in the Court of Appeal; and 17 out of 108 in the High Court. The figures for ethnic minority judges are proportionately worse: none in the Supreme Court, none in the Court of Appeal and only five on the High Court Bench. Even on the circuit Bench, the figures are just 16% and 2.5% respectively.

It is not just the appearance of being unrepresentative that distorts our judiciary. I firmly believe that the fact that there are so few women on the Bench has a substantial effect that distorts our substantive law. In Radmacher v Granatino, the case in which the Supreme Court held that ante-nuptial agreements should in general be respected, the noble and learned Baroness, Lady Hale—the only woman Supreme Court judge—largely dissented from her male colleagues when she said,

“In short, there is a gender dimension to the issue which some may think ill-suited to decision by a court consisting of eight men and one woman”.

There are often gender and racial issues to cases. If the development of the law continues to be left to stereotype white male judges, that will diminish the respect held not just for our judges, but also our law.

In international terms, our record on judicial diversity is appalling. Of all the countries considered in a report by the Council of Europe this year, only Azerbaijan and Armenia were less representative than England and Wales. There is effectively gender equality among the judiciary across the rest of Europe. In the earlier debate, the noble and learned Lord, Lord Lloyd of Berwick, mentioned the success in achieving gender equality in Canada and the United States.

All this is why I welcome the provision of paragraph 9 of Schedule 12 to the Bill, but also why the noble Baroness, Lady Hamwee, and I have put down amendments to enlarge its provisions and to enlarge the existing provision in the Constitutional Reform Act 2005 that encourages diversity. Under Section 64 of the 2005 Act as it stands, there is an obligation already on the Judicial Appointments Commission to promote diversity. However, that only applies to appointments under Part 4 of the Act, which does not apply to the selection of judges of the Supreme Court. Our Amendment 86A would introduce an exactly parallel provision into Part 3 of the Act, which governs the selection of judges, the president and deputy president of the Supreme Court. The Supreme Court is at the pinnacle of our system of justice. If we omit a requirement to encourage diversity there, we cast doubt on our

4 Dec 2012 : Column 584

commitment to achieve it throughout the system. The Government and the Bill recognise the need to encourage diversity. That must be reflected at the top.

The reform proposed in paragraph 9 of Schedule 12 to the Bill introduces the so-called “tipping point provision”—also called the tie-breaker provision—by which, where there are two candidates of equal merit, one may be preferred for the purpose of increasing diversity. Without that provision, the requirement that selection has to be made solely on merit prevents the commission from exercising its judgment in that way. However, paragraph 9 applies only to appointments under Part 4 of the 2005 Act; it does not apply to appointments to the Supreme Court. Our Amendment 86B would apply a similar tie-breaker provision to Supreme Court appointments as well.

It has been argued that such a provision is not necessary in relation to appointments to the Supreme Court, on the technical basis that under Section 27 of the 2005 Act such appointments are merely required to be “on merit”, rather than “solely on merit”, which is the requirement in Section 63 under Part 4. It is then said to follow that Section 159 of the Equality Act 2010 would permit recruitment to the Supreme Court on diversity grounds by using a tie-breaker principle. I am not sure that this distinction is a real one. But even if it is, there is nothing in Section 159 of the Equality Act that encourages, still less requires, tie-breaking. The combined effect of our Amendments 86A and 86B would do so. Tie-breaking does help. It should be explicitly encouraged on the face of the Bill throughout the system, and not merely, as the Government recognise, lower down than the Supreme Court.

Our final Amendment, 86C, would make it clear that the duty to encourage diversity is imposed on the Lord Chancellor in exercising his functions under Part 4 as well as on the Judicial Appointments Commission. Amendment 86D in this group, proposed by the noble Lords, Lord Pannick and Lord Powell, and the noble Baronesses, Lady Jay and Lady Prashar, would add the Lord Chief Justice to the list, because the Lord Chief Justice may be a consultee of the commission even if he is not a member of the selection panel, which is a committee of the commission. So Amendment 86D is more comprehensive, on reflection, and therefore to be preferred to our Amendment 86C. Either way, however, the important point is that we now urgently need to give impetus wherever we can to encouraging diversity, so that we can move from merely paying lip-service to the concept towards actually achieving it.

I do not know whether and to what extent my noble friend the Minister will make concessions to these amendments, but I emphasise that they are entirely consonant with the provisions already in the 2005 Act and in the Bill before the House tonight. I simply say this: you cannot expect the public or anyone else to think we are serious about encouraging diversity if we have a system that encourages it from the Court of Appeal down but does not encourage it in the Supreme Court, which is the highest court in the land.

6 pm

Lord Pannick: My Lords, I support the amendments in the name of the noble Lord, Lord Marks of Henley-on-Thames, and the noble Baroness, Lady Hamwee,

4 Dec 2012 : Column 585

but I want to speak to Amendment 86D, which arises out of the report of your Lordships’ Constitution Committee. The amendment is in my name and those of the noble Baroness, Lady Jay of Paddington, chairman of the Constitution Committee, the noble Baroness, Lady Prashar, former chairman of the Judicial Appointments Commission, and the noble Lord, Lord Powell of Bayswater, who is also a member of the Constitution Committee. I am very pleased to see the noble Baronesses, Lady Jay and Lady Prashar, in their places. The noble Lord, Lord Powell, apologises to the House that he is unable to be present as he has to be abroad today.

As your Lordships have heard, Section 64 of the Constitutional Reform Act imposes a duty on the Judicial Appointments Commission to have regard to the need to encourage diversity in the range of persons available for selection for appointments. The purpose of Amendment 86D is to ensure that this statutory duty to promote diversity is also placed on others who have leadership roles in relation to the judiciary: that is, the Lord Chancellor and the Lord Chief Justice. As the noble Lord, Lord Marks, has said, the promotion of diversity is one of the greatest challenges facing our legal system. Figures produced by Professor Alan Paterson, a very distinguished expert in the field of judicial studies, show that of the OECD countries, the representation of women in our Supreme Court—one member out of 12—puts us shamefully in the last place in that measure of diversity.

The aim of achieving a more diverse judiciary does not mean reducing the standards for appointment. On the contrary, merit remains the criterion. The task, as Section 64 recognises, is to identify ways of bringing to the fore those highly skilled women and members of ethnic minorities who are in the legal profession—there are very many of them—so that they can be considered for appointment on merit. The amendment would impose a statutory duty on the Lord Chief Justice and the Lord Chancellor in this regard.

The Government have previously argued that a specific statutory duty is not needed because everybody understands the need to move forward on this. There are three answers to that approach. First, Section 64 does contain a specific statutory duty on the Judicial Appointments Commission. It is right and proper to make clear that responsibility does not lie solely with the JAC but also with others in a leadership role. The noble Lord, Lord Deben, who I am pleased to see in his place today, made a very powerful speech on that point in Committee.

Secondly, a statutory provision such as this importantly emphasises to the public the recognition by all those in a leadership role that this is a subject to which priority must be given. Thirdly, and finally, the amendment, and the enactment of a statutory duty along these lines, is no criticism whatever of the efforts made by the current Lord Chief Justice—I know personally that he takes the need to promote diversity very seriously indeed—or of the new Lord Chancellor, or, indeed, his predecessors. They all take these matters very seriously, as I know does the Minister, who is personally committed to promoting diversity in the judiciary.

4 Dec 2012 : Column 586

However, they will not always be in post and it is important to take this opportunity to address the matter in legislation.

Amendments 86A to 86C, to which the noble Lord, Lord Marks, has spoken, also have my support, although he acknowledged that Amendment 86C may be less preferable to Amendment 86D. Amendment 86DA in the name of the noble Lord, Lord Beecham, which is also in this group, is to similar effect. Again, it has my support, although, if I may say so, it is optimistic indeed for proposed new subsection (4) of the amendment of the noble Lord, Lord Beecham, to suggest that the problem of a lack of diversity may be cured in five years. I remind the noble Lord that in a recent lecture, Lord Sumption of the Supreme Court suggested that 50 years was more realistic on current progress.

Baroness Jay of Paddington: My Lords, I rise briefly, but powerfully, I hope, to support the noble Lord, Lord Pannick, in his amendment and to say that I agree with much of what the noble Lord, Lord Marks, said. As has been said, this point was very much the burden of the Constitution Committee’s report on judicial appointments, which I had the privilege of chairing. Above all, our message was that there needed to be decisive and persistent leadership on this question among those making appointments at every level.

I agree with the noble Lord, Lord Pannick, and regretfully disagree with my noble friend Lord Beecham about the prospects for a timescale of five years to make this happen because one of the things which was absolutely clear in the evidence that we took from a number of people who had held office over a long period was that many of them had a personal commitment to improving diversity, as the noble Lord, Lord Pannick, has reinforced, but that none had actually succeeded in doing that. It seemed unlikely that that was to do with their capabilities but was much more a case of there being resistance within the system. Therefore, the obligation on the Judicial Appointments Commission to have a statutory duty to enforce and support diversity seemed to be one that should properly be extended to the wider group of people in leadership positions, as the noble Lords, Lord Pannick and Lord Marks, said.

The response from the Government to our report was surprising in the sense that it referred almost exclusively to the fact that the one thing the Government did not want to do was to overburden the statute book with this provision. Indeed, the Constitution Committee has returned to this subject in the past few weeks. We heard evidence on 21 November from the new Lord Chancellor, Mr Grayling, who again said that he was absolutely committed to making this objective happen. However, when asked why it did not happen, he said that it would be unfortunate to try to impose more legislation on the statute book when the objective could be achieved through the leadership which he and his predecessors said they were capable of. However, I point out to the House and the Minister that the amendment of the noble Lord, Lord Pannick, which I have signed, requires only 13 words to be added to the statute book. Therefore, it seems to me that the overburdening of legislation is not necessarily a powerful

4 Dec 2012 : Column 587

argument for rejecting it. The simple fact is that this is a very straightforward recommendation which could be absorbed into the Bill very easily.

The noble Lord, Lord Powell of Bayswater, who is, indeed, another signatory to this amendment and is not here this afternoon as he is in the United States, when speaking with the new Lord Chancellor, Mr Grayling, in our committee, referred again to the recommendation we had made about putting a statutory duty on him and the Lord Chief Justice. The noble Lord, Lord Powell, said—I think this was echoed by other members of the committee and is the point we all abide by—that it was not that we did not recognise that there had been progress but that,

“it has been at the pace of a pregnant snail”.

We now need to overtake the pregnant snail to which the noble Lord, Lord Powell, referred, and put this on the statute book in these very simple 13 words.

Baroness Prashar: My Lords, I rise to speak as the former chairman of the Judicial Appointments Commission. I have put my name to this amendment because I feel very strongly about this issue. I absolutely agree with what the noble Lord, Lord Pannick, the noble Baroness, Lady Jay, and the noble Lord, Lord Marks, have said. I think everyone now recognises that promoting diversity is a common endeavour—a joint effort to be made by the judiciary, the Ministry of Justice, the Lord Chancellor and the JAC. It is therefore important that all three have statutory responsibility, because that will focus their minds. As someone who was responsible for giving effect to the statutory responsibility of the JAC, I was always mindful of the fact that the focus really was on the JAC. Others sat around the table and said, “What is the JAC going to do?”

At Second Reading, the Minister said that this would be gesture politics. This is not gesture politics; it is about getting people to take responsibility, because there are a range of things that are outwith the responsibility of the JAC, where efforts need to be made. If your Lordships heard the debate earlier on the amendment of the noble and learned Lord, Lord Lloyd, concerning part-time working, you can see how formidable the opposition can be. We need to change that culture, impose that duty on others and provide an opportunity so that real progress can be made.

Baroness Neuberger: My Lords, as noble Lords will know, I chaired the Advisory Panel on Judicial Diversity, and I support all those who have already spoken. I love the analogy of the pregnant snail. It is now two and a half years since we reported, and with all the amazing good will that there has been—and there has been considerable good will, not least from the Minister, who has met with me regularly to see how we can take this further—the progress has been lamentably slow. It is therefore hugely important that the message is sent out widely that this is a statutory duty that applies not only to the Judicial Appointments Commission but much more widely. I particularly believe that we should also extend this to the Supreme Court.

4 Dec 2012 : Column 588

Baroness Kennedy of The Shaws: My Lords, I also support this amendment. I sigh, because I feel as though I have been working on this issue of diversity in the legal profession and on the Bench all my professional life, which I now have to confess has covered 40 years. It is really important that we recognise how slow progress has been.

I had a conversation with one of those senior men of the law not very long ago about the fact that we only had one woman on the Supreme Court. I was reminded that when the Sex Discrimination Act came in it brought a great flurry of change into the legal profession. Up until that time, chambers used to say, “We don’t take women”. When I started at the Bar, people said that. Then they started saying, “Women? We’ve got one”. My concern is that that sort of attitude, that somehow we are doing fine if we have a woman here and there, is not good enough. During this conversation, I expressed my sadness that we had only one woman on our Supreme Court and mentioned the name of a very eminent and good woman—at which he said, “I know, but she’s so ambitious”, as though this was a truly terrible thing to be, and an attribute that could not be attached to any of the senior men of law who have gone into the Supreme Court.

There is a culture in the law that is resistant to change; it is just the nature of things. We have to create this kind of encouragement if we want to see things move at a better pace.

6.15 pm

Lord Deben: My Lords, it would be a great mistake to do this if we did not have to. The problem is that we have to, because the present situation is not acceptable. No business could be run on this basis. You would have shareholders, even of the most reactionary kind, asking how on earth it was possible to run a major business in which there was one woman, on the basis that you had to have one. I very much appreciate the words that have just been said.

As I said on a previous occasion, if we did not need it, we would not have to do it but because we need it, we have to do it. I know that that sounds odd, but it seems the only answer to the Government’s argument so far, which I do not understand. I do not understand why it is sensible to do this at some points but not at others. That does not seem very sensible either. Surely it has always been best to do it at the top first, then all the way down. You do not do it at the bottom, and then hope it goes up. It is like having girls come into a boys’ school. It is a very odd system but when you want to open up a school you start at the bottom and the number of girls gradually goes up, until you have a mixed school at the top. I say that as the father of four children, two boys and two girls, none of whom went to mixed schools, but I know how they work and that is how you do it.

However, that does not mean that when you are dealing with the law you set a very good example by suggesting that it is not the same at every level. I am interested only in why that should be the case. I have listened to the Government’s arguments and no doubt if I have to listen again, I may be persuaded. Up to

4 Dec 2012 : Column 589

now, however, I am missing the logic. I would like to see a logical reason why this proposal should not be there, or why the other bits that are there should not be removed. That is the alternative: if we do not need this, why do we have the bits that we have?

I will say one last word about the addition to the Bill. The noble Baroness made a very good point about how long this is. There are many things in the law that could be removed to make room for this, and I can give a long list of them. For example, there is a part that makes it illegal for Roman Catholic churches to ring a bell. That is much longer than this bit; we could take that out and put this in quite happily. If, therefore, there is a question of overburdening, I can think of a series of overburdens that can be removed—so that argument does not work. I ask the Government to understand that by not doing this, a signal is being made. By doing it, a signal would also be made. I do not understand why they want to make the wrong signal.

Lord Mackay of Clashfern: My Lords, I had some experience of trying to push this agenda forward rather a long time ago but I wonder about, for example, creating a duty on the present Lord Chancellor to do this. What does this amount to? I have a feeling that the argument that has been presented suggests that you should make the duty incumbent on all the judiciary at all levels, so that they welcome diversity. That is my answer to the noble Baroness, Lady Kennedy of The Shaws. There is a limit to what the Lord Chancellor can do to change the culture now, with his present powers. There is also some question as to what the Lord Chief Justice can do, though he can be welcoming and so on. The logic of it is for the whole judiciary to be required to welcome diversity and all the benefits that it brings.

Lord Beecham: My Lords, I am fascinated, not to say a little distracted, by the zoological references to pregnant snails. I am not quite sure how one could tell, unless one was another snail. Perhaps I ought to address myself to the amendments rather than to this curious analogy.

I certainly support the thrust of the amendment of the noble Lord, Lord Pannick. Amendment 86DA, which is in my name, sets out a process; I should indicate to the noble Lord that perhaps the drafting is not quite as it should be. However, subsection (4) in my proposed new section 64A, which states:

“These duties shall continue for five years, but may be extended for five year terms by order”,

relates to its subsection (3) on the question of annual reports, rather than the principal objectives of that amendment, which are set out in subsections (1) and (2).

Several of your Lordships have pointed out the importance of making progress in this critical area. The noble and learned Lord, Lord Mackay of Clashfern, suggests that the duty should be spread wider, but it is difficult to envisage a duty on the holder of a judicial office to promote diversity in that capacity. It is surely a matter for those with greater responsibility at the top of the pyramid, both politically and judicially—the Lord Chancellor and the Lord Chief Justice, in addition

4 Dec 2012 : Column 590

to the commission—to have that duty. It is presumably easier to hold them to account in a less informal way than it would be to hold the whole judiciary to account.

I hope that the Government will accede to the arguments made by noble Lords and noble Baronesses. This is not a dramatic amendment, but it underpins the process that your Lordships have clearly adopted and wish to see implemented. It is a matter on which I should have thought the Government could concede without any kind of embarrassment because it carries out effectively the thrust of the policy on which the majority of the House are clearly agreed. I therefore hope that the Minister can agree to that or, at the very least, give it some further thought and come back at Third Reading. It would be better not to have to vote on this matter, given that there is a great deal of common ground. I am looking to the noble Lord to be as co- operative on this occasion as I was on a previous occasion.

Lord McNally: The noble Lord, Lord Beecham, can be very seductive at times, but let me try to respond to an extremely thought-provoking debate. I was interested in the mention by the noble Lord, Lord Deben, of girls going into boys’ schools and vice versa, because I have just had experience of this. My daughter has just moved from an all-girls’ school into the sixth form of an all-boys’ school. After a few weeks, I asked her, “How is it going?”. She said, “It’s wonderful, daddy, all the boys open the door for me”. That is an illustration of how a little change can bring behavioural changes, and that is probably what the noble Lord, Lord Deben, was suggesting, whereby perhaps a few girls in the all-boys’ school of the upper judiciary might produce similar changes in attitude.

I was very grateful for the intervention of the noble and learned Lord, Lord Mackay, because this debate turns on an issue that I explained in Committee. There is no doubt that both the Lord Chancellor and the Lord Chief Justice have a duty under the Equality Act to promote diversity. On the point made by the noble Lord, Lord Marks, that this does not apply to the Supreme Court and therefore implies some sort of ceiling in this, that is not true. We think that the tipping point in the Equality Act already applies to Supreme Court appointments and, therefore, that his amendment is not necessary.

I can put before noble Lords the standard brief that the Lord Chief Justice and the Lord Chancellor already have these duties enshrined, and that the Equality Act takes care of the problems that the noble Lord, Lord Marks, mentioned. However, that would not be the right response to a debate that has contained most of the people whom I count as allies in what I still think is a battle to get greater diversity into our judiciary. I was told earlier that I was being pejorative when I talked about this being a trickle-up. However, the figures quoted by a number of speakers illustrate that there is still a need for leadership, as the noble Baroness, Lady Jay, said. I applaud the leadership that her committee has given in this area, just as I applaud the leadership given by the noble Baronesses, Lady Prashar, Lady Neuberger and Lady Kennedy. However, we need that leadership elsewhere in the judiciary. I am almost tempted, as the noble and learned Lord, Lord Mackay, said, to make it applicable to all the judiciary.

4 Dec 2012 : Column 591

I am willing to be seduced here by the noble Lord, Lord Beecham, as it would be an insult to the House and the opinions of people whom I respect immensely on this matter if I were simply to call a Division and bring in people who have not heard this debate to vote these amendments down. If noble Lords who have amendments in this group would withdraw or not move them, I will take this matter back to the Lord Chancellor. That will also give time for discussions with the Lord Chief Justice to see whether we can, in some way, meet the points that have been made.

I shall tell noble Lords where I am coming from. Recently, a very senior member of the judiciary pinned me in the corner and said, “If you do what you are trying to do to the judiciary, can you guarantee me that in 20 years we will still have a judiciary that is the envy of the world?”. I said, “Yes, but half of them will be women”. That may be overambitious but it is a lot better than a 50-year timescale or a “sometime, never” timescale. I therefore believe, as the noble Lord, Lord Deben, said, that sometimes gesture politics is important.

Tonight, I want to take this debate back to the Lord Chancellor and let him ponder on it. It may be that I will have to resist when we return to the issue on Third Reading, but I do not want to resist tonight because the quality of the debate and the persuasiveness of the argument deserve another look at this matter. In that spirit, I ask noble Lords to withdraw or not move their amendments.

Lord Marks of Henley-on-Thames: My Lords, everyone in this House knows that the commitment of the Minister to judicial diversity is very high, and I am grateful for his indication that he will consider this. I should say that I do not accept that the Equality Act deals with the position in the Supreme Court as satisfactorily as it has been suggested it might. The Bill should reflect uniformity all the way up the system. With the indication that my noble friend has given, however, I will of course withdraw the amendment and consider the matter with him between now and Third Reading.

Amendment 86A withdrawn.

Amendments 86B to 86E not moved.

Amendments 87 to 89

Moved by Lord McNally

87: Schedule 12, page 199, line 22, leave out “not be greater” and insert “be less”

88: Schedule 12, page 204, line 19, leave out second “appointed”

89: Schedule 12, page 209, line 31, at end insert—

“Lay justices to be appointed by Lord Chief Justice

36A (1) Section 10 of the Courts Act 2003 (justices of the peace who are not District Judges (Magistrates’ Courts)) is amended as follows.

(2) In subsection (1) (Lord Chancellor’s power of appointment) for “Lord Chancellor” substitute “Lord Chief Justice”.

(3) After that subsection insert—

“(1A) Subject to the following provisions of this section and to sections 11 to 15, a person appointed under subsection (1) is to

4 Dec 2012 : Column 592

hold and vacate office as a justice of the peace in accordance with the terms of the person’s appointment, which are to be such as the Lord Chancellor may determine.”

(4) After subsection (2) insert—

“(2ZA) The Lord Chief Justice must ensure that arrangements for the exercise, so far as affecting any local justice area, of the function under subsection (1) include arrangements for consulting persons appearing to the Lord Chief Justice to have special knowledge of matters relevant to the exercise of that function in relation to that area.”

(5) In subsection (2A) (Lord Chancellor to ensure local consultation takes place in relation to the exercise of functions under subsections (1) and (2)) for “subsections (1) and” substitute “subsection”.

(6) After subsection (6) insert—

“(6A) The Lord Chief Justice may nominate a senior judge (as defined in section 109(5) of the Constitutional Reform Act 2005) to exercise functions of the Lord Chief Justice under subsection (1).”

(7) In subsection (7) (delegation of Lord Chief Justice’s functions) after “subsection (2)” insert “, (2ZA)”.”

Amendments 87 to 89 agreed.

6.30 pm

Amendment 89A

Moved by Lord Beecham

89A: Schedule 12, page 209, line 31, at end insert—

“36A The Lord Chancellor shall lay before Parliament within twelve months, and thereafter periodically, a report on the composition of the magistracy, including the numbers of lay magistrates and the numbers of full time district judges sitting in magistrates’ courts.”

Lord Beecham: My Lords, we have talked a great deal about judicial diversity in the upper courts, and there is a concern about both the composition of the Bench and its current functioning at the level of the magistracy. The concern is perhaps twofold.

First, I know that there is growing anxiety among lay magistrates about the increasing numbers of full-time district judges who are being appointed, thereby diminishing the role of lay magistrates. This matter has certainly been reported to me from places as far apart as Newcastle, Birmingham and Brighton, and it has also surfaced in a number of other areas. Notably, as I understand it, there is concern among lords-lieutenant —who obviously have close working relationships with the magistracy in their areas—at the apparent drift away from the hitherto prominent role of the lay magistracy in the operation of the courts. That is the reason, in particular, for the part of the amendment which seeks a report on the composition of the magistracy, including the number of lay magistrates and the number of full-time district judges. I asked a Written Question about this issue and the reply, slightly surprisingly, was that the Government simply did not know what the numbers were. This has obviously gone on for a very long time. However, if we are serious about looking at the function of the magistracy and its composition, it is surely incumbent on the Government to produce the data.

The problem of the composition of the Bench is perhaps also exacerbated not merely by the question of professional and lay magistrates or judges but by

4 Dec 2012 : Column 593

other issues, including diversity issues of gender, ethnicity and, I have to say, class in the local magistrates’ courts. The problem may be made more difficult by the closure of magistrates’ courts, to which I have referred. In addition to the difficulties that some people may have in getting sufficient time off work to serve as magistrates, it will now often be the case that they have to travel to a court which is no longer in the town where they might previously have sat or might seek to sit, and this will clearly compound the problems. It is already difficult enough for working people, whether they are well paid or not, to get time off to attend to these responsibilities, and I suspect that all these matters will continue the push towards having full-time appointments.

There is of course a place for full-time appointments and they have served for many years—formerly in the guise of stipendiary magistrates and now district judges—dealing particularly, but not exclusively, with criminal matters, yet the feeling now within the magistracy is that the role of the lay magistrate is being diminished. Magistrates’ clerks are effectively no longer answerable to their local court committee but answerable upwards, as it were, to the ministry. In many places, what was local justice is apparently coming to be seen as simply another arm of a national department—that is, the ministry—and, as with local policing, that is something that one would regret. One can apply Sir Robert Peel’s definition of policing by the people to local justice—by people from the community, knowing the locality and, to a degree, representing that locality. This is not just a recent matter—it has been going on for some time—and it is not by any means a matter to be laid entirely at the door of this Government. However, it seems to me a process which is to be regretted.

Therefore, this amendment seeks to establish a system in which there can at least be consideration of the facts. I hope that that will lead to the kind of debate and the kind of decisions that we are moving towards in respect of judicial diversity at the other level, but in this case I hope that it will also lead to a reconsideration of the role of lay magistrates. There is a danger—as I said, as reported by magistrates and lords-lieutenant—that the system may be dying on its feet because of this change to the professional local judiciary.

I am not anticipating that the Government will necessarily accept or support this. Again, it might be a matter that the noble Lord will be willing to take back and reconsider. It might be thought over-prescriptive but it will potentially open the door to the kind of developments to which I have referred.

I see that the noble Baroness, Lady Seccombe, is in the Chamber tonight. I think that in Committee she voiced similar concerns from her own very practical experience as a magistrate. My noble friend Lord Ponsonby is not here tonight but I know that he also shares these concerns. I think that it would fit very well with the laudable efforts that the Government are making in the upper echelons of the judiciary if this matter were given some consideration and the topics to which I have alluded could be addressed over time, basically with the same intention but with the added dimension of locality, as well as diversity, in relation to the amateur or part-time lay justice as well as the professional justice. I beg to move.

4 Dec 2012 : Column 594

Baroness Seccombe: My Lords, as a former magistrate, I support all the sentiments of the noble Lord, Lord Beecham. He has expressed the great fears of the magistracy that it is gradually becoming more and more centralised and that the point of local justice is disappearing. The thing that I have a little trouble with is how that fits into this Bill at this time, and I should be very interested to hear what the Minister has to say on this.

Lord McNally: My Lords, I am grateful for the contributions from the noble Lord, Lord Beecham, and the noble Baroness, Lady Seccombe. Both have made important points about the concept of local justice and the massive boon that comes from a magistracy rooted in its locality and with a knowledge of the problems of an area and, indeed, of the people of an area. In previous debates I have given a run-out to the names Tommy Croft and Billy Quinn. They both worked in the local ICI works near to where I was born and they were both local magistrates. Everybody knew them and everyone, particularly the youth of the locality, dreaded appearing before them. That is the kind of benefit that we get from a magistracy which is rooted in its locality. But, alas, that was 50 years ago. Both my noble friend Lady Seccombe and the noble Lord, Lord Beecham, are right to say that, in our drive for various efficiencies and for uniform high quality, we must ensure that we do not squeeze out the benefit that we get from a lay magistracy. The magistracy performs a vital role in our justice system and the Government are highly supportive of both lay magistrates and full-time district judges sitting in magistrates’ courts.

In our White Paper, Swift and Sure Justice, we restated our view that the lay magistracy is one of our most important assets. The White Paper also sets out proposals to give magistrates new roles and responsibilities. We are currently working through the responses that we received and we will confirm our plans in due course.

I fully understand the request by the noble Lord, Lord Beecham, for information on the composition of this crucial element of our judicial system. I am delighted to confirm that official data from the Judicial Office are already publicly available on the judiciary website. That includes not only information on the number of lay magistrates in each of the 47 advisory committee areas and the name and number of district judges sitting in magistrates’ courts but also detailed information on gender, age, ethnicity and disability. Those data are published annually on 1 April. The number of lay magistrates in post as of 1 April 2012 was 25,155; the number of district judges sitting in magistrates’ courts was 141, with 134 deputy district judges. Perhaps I can illustrate the level of detail to which this information goes: 51.3% of lay magistrates and 29.1% of district judges were female; 53.9% of lay magistrates and 35.4% of district judges were 60 or over; 4.5% of lay magistrates identified themselves as having a disability; and 8.1% of lay magistrates and 2.8% of district judges were from black and minority ethnic groups. There is even more detail on the website, should noble Lords wish to visit the relevant links.

4 Dec 2012 : Column 595

Given the extensive amount of official information on the composition of the magistracy already in the public domain, I suggest that a requirement for the Lord Chancellor to lay a periodic report before Parliament is unnecessary. On that basis, I ask the noble Lord to withdraw his amendment.

Lord Beecham: I am very much obliged to the Minister for that information. I am a little surprised that it did not find its way into the Answer to my parliamentary Question some time ago. It is reassuring that that information is available. I shall withdraw the amendment, but I would like to ask whether there is any indication of, for example, employment categories or, frankly, class, although that may be asking too much; it may be difficult to get. I take it that the Minister would wish to promote diversity and look into the concerns that the noble Baroness and I both raised about the role of the lay magistrate in general. I gather that he is sympathetic to that. Therefore, without seeking to incorporate this into the Bill, perhaps he could undertake to have a look at that departmentally and perhaps in conjunction with, say, the Magistrates’ Association and the Magistrates’ Clerks Association, if that still exists, as a matter of government policy rather than legislation. In the circumstances, I beg leave to withdraw the amendment.

Amendment 89A withdrawn.

Amendments 90 to 92

Moved by Lord McNally

90: Schedule 12, page 210, line 11, at end insert—

“Justice of the Peace appointed under section 10(1) of the Courts Act 2003 (justices of the peace other than District Judges (Magistrates’ Courts))”

91: Schedule 12, page 210, line 24, at beginning insert—

“(1) In section 8 (power of Senior President of Tribunals to delegate) after subsection (1) insert—

“(1A) A function under paragraph 1(1) or 2(1) of Schedule 2 may be delegated under subsection (1) only to a Chamber President of a chamber of the Upper Tribunal.”

(2) ”

92: Schedule 12, page 210, leave out lines 28 and 29

Amendments 90 to 92 agreed.

6.45 pm

Amendment 93

Moved by Lord McNally

93: Schedule 12, page 218, line 13, leave out from “power” to “to” in line 14

Lord McNally: My Lords, I shall come clean with the House. Earlier, overtaken by the excitement of getting government amendments through, my noble friend Lord Taylor nodded through government Amendment 83, to which I was supposed to speak. It is grouped with Amendment 93, which gives me the opportunity to catch up with it. This allows me to

4 Dec 2012 : Column 596

make a concession which was argued with some passion by the noble and learned Lord, Lord Falconer, in Committee, about the provisions enabling the Lord Chancellor to sit on the selection panel for the Lord Chief Justice and the President of the Supreme Court’; sadly, the noble and learned Lord was here for only a fleeting moment.

In Committee, these provisions were a matter of considerable concern to many of your Lordships. Although I thought that I defended the position with considerable persuasiveness, the Lord Chancellor decided, the brief says here, that we have carefully considered the arguments that were put forward at that stage as well as those set out in the reports of the Constitution Committee and the Joint Committee on Human Rights. The amendments respond to those concerns by removing from the Bill those provisions relating to the Lord Chancellor’s ability to sit on the selection panel for the Lord Chief Justice and the President of the Supreme Court. Thanks to the noble Lord, Lord Taylor, we have already agreed Amendments 83, 84 and 85 in this group and I am now using this opportunity to move Amendment 93 and to speak to Amendments 97 and 98. I hope that the House will find this acceptable.

In view of the importance of the roles of the Lord Chief Justice and the President of the UK Supreme Court to the administration of justice, we remain of the view that the Lord Chancellor should have a role in these senior appointments. Accordingly, while we will revert to the existing arrangements in that the Lord Chancellor will not sit on the selection panel but will decide whether to accept the selection, reject it or ask the panel to reconsider its selection, we intend to augment these to ensure that the Lord Chancellor is engaged earlier in the selection process. Taking on board the comments raised in Committee, we now propose that the selection panel consults the Lord Chancellor during the selection process. This already occurs in relation to Supreme Court appointments but will be new in relation to the appointment of a Lord Chief Justice.

We have shared the draft indicative regulations with noble Lords relating to the appointment process and these provide for this consultation by the panel in relation to all appointments to the Supreme Court and to certain senior judges in England and Wales, such as the Lord Chief Justice and Lords Justice of Appeal. In addition to this, we will, as I have said, restore the current position whereby the Lord Chancellor will receive the selection panel’s report and, in the light of that, decide whether to accept or reject the panel’s recommendations, or alternatively ask the panel to reconsider its recommendation. I hope that noble Lords will agree that this approach now establishes an appropriate mechanism for the Lord Chancellor’s views to be heard, while safeguarding the impartiality of the selection process. I beg to move.

Lord Pannick: I thank the Minister for reverting to the important Amendments 83, 84 and 85. As the noble Lord mentioned, your Lordships’ Constitution Committee was critical of the proposal in the Bill for the Lord Chancellor to sit as a member of the appointments committee appointing the Lord Chief Justice and the President of the Supreme Court. The

4 Dec 2012 : Column 597

Minister's advocacy in Committee was outstanding but, as he will know, sometimes the best advocacy is in support of a completely hopeless cause. I genuinely thank the Minister and the Lord Chancellor for listening on this important subject. It is a matter of constitutional concern. I thank them for bringing forward amendments to the Bill in accordance with the recommendations of your Lordships’ Constitution Committee.

Lord Mackay of Clashfern: I wonder whether it is worth mentioning that, of course, the Supreme Court is of interest in jurisdictions other than those in which the Lord Chancellor has authority now, and there may be a question about the balance of that. Admittedly, other jurisdictions have representation on the selection committee, but it may be worth while keeping in place that balance.

Lord Beecham: My Lords, I endorse everything that the noble Lord, Lord Pannick, said, as a surrogate for my noble and learned friend Lord Falconer. Had he been here I am sure that he would have enthusiastically congratulated the Government on their change of heart. Again, I rather tiresomely congratulate the Minister on accepting the wisdom of the House as previously expressed. We welcome this change and reversion to what is essentially the current situation. We look forward to more of the same as we go through the Bill.

Amendment 93 agreed.

Amendments 94 to 103A

Moved by Lord McNally

94: Schedule 12, page 218, line 51, at end insert—

“( ) provide for section 16(2)(a) or (b) not to apply in relation to functions of the Lord Chief Justice—

(i) as a member of such a panel (including functions of chairing such a panel), or

(ii) in relation to the nomination or appointment of members of such a panel;”

95: Schedule 12, page 219, line 42, at end insert—

“51A In section 66(1)(a) (Lord Chancellor to consult Lord Chief Justice before issuing guidance about selection procedures) for “consult” substitute “obtain the agreement of”.”

96: Schedule 12, page 220, line 15, at end insert—

“(1BA) The members of the panel may not include the current holder of the office for which a selection is to be made.”

97: Schedule 12, page 220, leave out line 18

98: Schedule 12, page 220, leave out lines 20 and 21

99: Schedule 12, page 220, line 25, at end insert—

“(5) Omit subsection (5) (if practicable, panel to consult current holder of office).”

100: Schedule 12, page 220, line 41, at end insert—

“(1C) The members of the panel may not include the Senior President of Tribunals.””

101: Schedule 12, page 222, line 34, leave out “Regulations” and insert “An order”

102: Schedule 12, page 225, line 1, leave out “In section 97(1)” and insert—

“(1) Section 97”

103: Schedule 12, page 225, line 3, leave out “omit paragraphs (c) and (e)” and insert “is amended as follows.

4 Dec 2012 : Column 598

(2) In subsection (1) (list of provisions requiring consultation)—

(a) omit paragraphs (b), (c) and (e), and

(b) in paragraph (d) for “95(2)(a), (b)” substitute “95(2)(b)”.

(3) In subsection (4) (modification where requirement is to obtain concurrence rather than to consult) after “section 94A(1)” insert “or 95(2)(a)”.”

103A: Schedule 12, page 226, line 44, at end insert—

“Part 4AAppointment of judge to exercise functions of a head of division in case of incapacity or a vacancy etc

76A Where a Head of Division is incapable of exercising relevant functions, or the office of a Head of Division is vacant, the Lord Chief Justice may, with the concurrence of the Lord Chancellor, appoint a judge of the Senior Courts to exercise relevant functions of the Head of Division.

76B An appointment under paragraph 76A—

(a) must be in writing,

(b) must specify the functions that may be exercised by the appointed judge, and

(c) must set out the duration of the appointment.

76C In paragraph 76A—

“Head of Division” means—

(a) the Master of the Rolls,

(b) the President of the Queen’s Bench Division,

(c) the President of the Family Division, or

(d) the Chancellor of the High Court;

“the Lord Chief Justice” means the Lord Chief Justice of England and Wales;

“the Senior Courts” means the Senior Courts of England and Wales.

76D In this Part “relevant functions” means functions under any of the following—

section 5 of the Public Notaries Act 1843 (functions of Chancellor of the High Court in relation to refusal of master of the faculties to grant a faculty to practise as a public notary);

section 8(5) of the Public Records Act 1958 (President of the Family Division to be consulted in relation to transfer of certain records);

section 5(2) or (3) of the Senior Courts Act 1981 (concurrence of Heads of Division with transfer of judges between Divisions of High Court etc);

section 7(1) of the Senior Courts Act 1981 (power of Lord Chancellor, Lord Chief Justice and Heads of Division, acting collectively, to recommend alteration of Divisions of High Court etc);

section 11(9) of the Senior Courts Act 1981 (concurrence of particular Heads of Division etc with Lord Chancellor’s declaration of a vacancy in the office of a judge of the Senior Courts who is permanently incapacitated and unable to resign);

section 54 of the Senior Courts Act 1981 (functions of Master of the Rolls in relation to composition of courts of civil division of Court of Appeal);

section 57 of the Senior Courts Act 1981 (determination by Master of the Rolls with concurrence of Lord Chancellor of sittings of civil division of Court of Appeal during vacation);

section 61(5) of the Senior Courts Act 1981 (concurrence of Heads of Division concerned with assignment of business of one Division of High Court to another Division of High Court);

section 63(3) of the Senior Courts Act 1981 (concurrence of Head of Division concerned with direction that business is to cease to be assigned to specially nominated judge of High Court);

4 Dec 2012 : Column 599

section 71(4)(a) of the Senior Courts Act 1981 (determination by Heads of Division with concurrence of Lord Chancellor of sittings of Divisions of High Court during vacation);

section 109(2) or 110 of the Senior Courts Act 1981 (President of the Family Division may make certain arrangements in relation to documents relating to probate etc);

section 111 of the Senior Courts Act 1981 (President of the Family Division may give directions as to form and content of records of grants made in the Principal Registry or a district probate registry);

section 126 of the Senior Courts Act 1981 (President of the Family Division may, with concurrence of Lord Chancellor, make regulations imposing conditions on deposit of wills);

section 133 of the Senior Courts Act 1981 (functions of Master of the Rolls in relation to enrolment and engrossment of instruments);

section 25(3)(a) of the Administration of Justice Act 1982 (President of the Family Division may, with concurrence of Lord Chancellor, make regulations as to deposit and registration of wills);

section 257(3) of the Inheritance Tax Act 1984 (President of the Family Division may make certain arrangements in relation to delivery of accounts for the purposes of that Act);

section 37 of the Matrimonial and Family Proceedings Act 1984 (President of the Family Division may, with concurrence of Lord Chancellor, give directions with respect to distribution and transfer between High Court and family court of family business and family proceedings);

section 1(9) of the Courts and Legal Services Act 1990 (Heads of Division etc to be consulted in relation to changes to allocation of business of High Court and county court);

section 58A(5)(a), 58AA(6)(a) or 58B(7)(a) of the Courts and Legal Services Act 1990 (Heads of Division etc to be consulted in relation to certain matters relating to agreements for funding of legal services);

section 56(4) of the Access to Justice Act 1999 (Heads of Division etc to be consulted in relation to changes to destination of appeals);

section 57 of the Access to Justice Act 1999 (Master of the Rolls or President of the Family Division etc may assign appeals to the Court of Appeal);

section 2(7) of the Courts Act 2003 (Heads of Division etc to be consulted in relation to authorisation of contracting-out of administrative work of courts);

section 64(4) of the Courts Act 2003 (Heads of Division to be consulted in relation to change of judicial title);

section 66(4)(b) of the Courts Act 2003 (President of the Family Division may nominate Circuit judges etc to sit as members of family proceedings courts);

section 77(3) of the Courts Act 2003 (President of the Family Division etc to be consulted in relation to certain appointments to Family Procedure Rule Committee);

section 78(2) of the Courts Act 2003 (President of the Family Division to be consulted in relation to certain changes to Family Procedure Rule Committee);

section 92(5) of the Courts Act 2003 (Heads of Division etc to be consulted in relation to fees of Senior Courts, family court, county court and magistrates’ courts);

paragraph 12(4) of Schedule 7 to the Courts Act 2003 (Heads of Division etc to be consulted in relation to regulations about enforcement officers);

4 Dec 2012 : Column 600

section 52(4) of the Constitutional Reform Act 2005 (Heads of Division etc to be consulted in relation to Supreme Court fees);

section 183(7)(b) of the Legal Services Act 2007 (consent of Master of the Rolls etc in relation to fees for administration of an oath or taking of an affidavit);

paragraph 1(10) of Schedule 3 to the Legal Services Act 2007 (concurrence of President of the Family Division etc with meaning of “reserved family proceedings” prescribed for the purposes of that paragraph).

76E The Lord Chancellor may by order amend the list in paragraph 76D so as to—

(a) add an entry,

(b) remove an entry, or

(c) vary an entry.

76F After section 10(6) of the Senior Courts Act 1981 (where there is a vacancy in one or more of the offices of the Heads of Division, a newly-appointed Lord Chief Justice is to take the required oaths in the presence of the holders of such of the offices as are not vacant) insert—

“(6A) Where the holder of an office mentioned in subsection (5) is incapable of exercising the functions of the office, the office is to be treated as vacant for the purposes of subsection (6).””

Amendments 94 to 103A agreed.

Schedule 13 : Deployment of the judiciary

Amendments 104 and 105

Moved by Lord McNally

104: Schedule 13, page 229, line 23, after “(4))” insert “—

(a) for “judicial office holder (as defined in section 109(4)” substitute “senior judge (as defined in section 109(5)”, and

(b) ”

105: Schedule 13, page 234, line 3, at end insert—

“10A (1) In paragraph 6(3)(a) of each of Schedules 2 and 3 (requests to certain judges to act as judges of First-tier Tribunal or Upper Tribunal may be made only with the concurrence of the Lord Chief Justice) omit the “or” at the end of sub-paragraph (iv) and, after sub-paragraph (v), insert “,

(vi) the Master of the Rolls,

(vii) the President of the Queen’s Bench Division of the High Court of England and Wales,

(viii) the President of the Family Division of that court,

(ix) the Chancellor of that court,

(x) a deputy judge of that court, or

(xi) the Judge Advocate General;”.

(2) In paragraph 6 of Schedule 2 (judges by request of First-tier Tribunal) after sub-paragraph (3) insert—

“(3A) A request made under sub-paragraph (2) to a person who is a judge of the First-tier Tribunal by virtue of section 4(1)(ca) may be made only with the concurrence of the Lord Chief Justice of England and Wales.””

Amendments 104 and 105 agreed.

Clause 20 : Payment of fines and other sums

Amendment 106

Moved by Lord Ahmad of Wimbledon

106: Clause 20, page 17, line 44, at end insert—

“(1A) In section 20 of the Tribunals, Courts and Enforcement Act 2007 (transfer from the Court of Session to the Upper Tribunal)—

(a) in subsection (1)—

4 Dec 2012 : Column 601

(i) in paragraph (a), for “, 2 and 4 are met” substitute “and 2 are met, and”,

(ii) omit paragraph (aa) (including the “and” following it), and

(iii) in paragraph (b), for “, 3 and 4” substitute “and 3”, and

(b) omit subsections (5) and (5A).

(1B) In section 25A of the Judicature (Northern Ireland) Act 1978 (transfer from the High Court to the Upper Tribunal)—

(a) in subsection (2), for “, 3 and 4” substitute “and 3”,

(b) omit subsection (2A),

(c) in subsection (3), for “, 2 and 4” substitute “and 2”, and

(d) omit subsections (7) and (8).”

Lord Ahmad of Wimbledon: My Lords, Amendments 106 and 107 will remove current restrictions to enable applications for judicial reviews in immigration, asylum and nationality cases, made either to the Court of Session in Scotland or the High Court of Northern Ireland, to be transferred to the Upper Tribunal.

As noble Lords may recall, the House has already considered this issue in relation to England and Wales in Committee when what is now Clause 20 was added to the Bill. I believe that it is fair to say that the Committee welcomed those provisions. Having discussed the matter further with the judiciary and the devolved Administrations in Northern Ireland and Scotland, we are now moving to replicate this provision across the United Kingdom.

The effect of these amendments would be to allow more judicial reviews on immigration, asylum and nationality matters to be heard by Upper Tribunal judges with specialist immigration knowledge and would free up judges in the Court of Session and the High Court in Northern Ireland to deal with other complex civil and criminal work.

Amendment 108 also aims to ensure consistency in the justice systems across the United Kingdom by reintroducing the second-tier appeals test for applications to the Court of Session to appeal against a decision of the Upper Tribunal. The rule of court which introduced this test in Scotland was found to be ultra vires in a decision of the Inner House and, as a result, the rule was revoked by the Lord President. The test requires that, in order for the Court of Session to grant permission to appeal, it should be satisfied that the proposed appeal raises an important point of principle or practice, or that there is some other compelling reason to hear the appeal.

My noble friend Lord Avebury has tabled two amendments seeking to limit or remove the second-tier appeal test in nationality and immigration cases. I do not wish to prejudge what my noble friend has to say and I will, of course, respond in due course, when we come to the next group. However, as Amendment 108 suggests, the Government fully support a second-tier appeals test throughout the United Kingdom.

In summary, the Government believe that where an appeal has been heard and determined by both the First-tier Tribunal and the Upper Tribunal, it seems entirely appropriate that the test to take the matter to a third judicial body should be high. Furthermore, the test is designed to manage effectively the flow

4 Dec 2012 : Column 602

of cases to the Court of Appeal and ensure that the court’s attention is focused on the most important cases.

As I have indicated, Amendments 106, 107 and 108 will ensure that there is a consistent framework across the United Kingdom and will remove the spectre of forum shopping between jurisdictions. I therefore beg to move.

Lord Avebury: My Lords, can my noble friend confirm that these provisions concerning Scotland will be the subject of a debate on a Sewel motion in the Scottish Parliament? Your Lordships may recall that when we debated the Bill that became the Borders, Citizen and Immigration Act 2009 in your Lordships' House, the Court of Session stated very clearly in its response to the government consultation, Immigration Appeals:Fair decisions,Faster justice, that it regarded the proposed transfer as premature. The Scottish Government had expressed similar concerns and had asked the UK Government not to proceed with the change at that time. I would be most grateful if my noble friend could respond to that point.

Lord Ahmad of Wimbledon: My Lords, Amendments 106 and 107 would not in themselves lead to any cases being transferred from the Court of Session or the High Court of Northern Ireland to the Upper Tribunal. It is simply an enabling power. In Scotland, an act of sederunt would need to be made by the Lord President, with the agreement of the Lord Chancellor, before any class of judicial reviews could be transferred from the Court of Session to the Upper Tribunal. The Court of Session will continue to have the discretion to transfer other applications for judicial reviews relating to reserved matters not specified in the act of sederunt by order.

I say to my noble friend that the same is true for Northern Ireland. Before the transfer of a class of judicial review cases from the Northern Ireland High Court to the Upper Tribunal, a direction would be made. As such, a legislative consent motion would not be required.

Amendment 106 agreed.

Amendments 107 and 108

Moved by Lord McNally

107: Clause 20, page 18, line 1, leave out “subsection (1), section 53(1)” and insert “subsections (1) to (1B), section 53”

108: After Clause 20, insert the following new Clause—

“Permission to appeal from Upper Tribunal to Court of Session

In section 13 of the Tribunals, Courts and Enforcement Act 2007 (right to appeal from Upper Tribunal) after subsection (6) insert—

“(6A) Rules of court may make provision for permission not to be granted on an application under subsection (4) to the Court of Session that falls within subsection (7) unless the court considers—

(a) that the proposed appeal would raise some important point of principle, or

(b) that there is some other compelling reason for the court to hear the appeal.””

Amendments 107 and 108 agreed.

4 Dec 2012 : Column 603

Amendment 108ZA

Moved by Lord Avebury

108ZA: After Clause 20, insert the following new Clause—

“Immigration and nationality appeals from the Upper Tribunal

Section 13(6) of the Tribunals, Courts and Enforcement Act 2007 (right of appeal to court of appeal etc.) does not apply in relation to immigration and nationality appeals from the Upper Tribunal.”

Lord Avebury: My Lords, noble Lords will be relieved to hear that I am not going to repeat the arguments that were advanced when these proposed new clauses were debated in Committee. But I should remind noble Lords that the first new clause would remove altogether the additional and highly restrictive requirement to show an important point of principle, practice or some other compelling reason in immigration and nationality appeals generally from the Upper Tribunal to the Court of Appeal. The second new clause removes that requirement only where the grounds of appeal include refugee or human rights grounds.

My noble friend Lady Northover, who replied to the amendment in July, agreed that the class of cases that we are dealing with can be both complex and of the utmost importance. They deal with grave problems that deserve the anxious scrutiny of the court system. But she claimed that the second-tier appeals test provided just that.

However, I also observed that because of the increased rotation of judges under the Bill, inevitably there would be judges in the Upper Tribunal who would be less familiar with the complexities of immigration and asylum law. In the case of PR (Sri Lanka), which I mentioned on the last occasion, Lord Justice Carnwath said at paragraph 39:

“Parliament has thus provided a statutory framework within which the Senior President and Chamber President should be able to ensure that the gateway to appeals to that level is controlled by judges of appropriate status and experience”.

I fear that that may not always be the case.

In the same case, the Court of Appeal found against the argument that there was a compelling reason for allowing PR's application to appeal from the Upper Tribunal’s adverse decision. It was acknowledged that he had been tortured and that the Second-tier Tribunal had corrected an error of law on the part of the First-tier Tribunal. But the Court of Appeal concluded that:

“The claimed risks are, unhappily, in no way exceptional in this jurisdiction, and not in themselves such as require the attention of the Court of Appeal”.

That reference was not picked up in our previous debate, nor did the Minister say anything about the Court of Appeal's remark that it would be wrong in principle for it to be constrained by ministerial assurances on asylum cases given in 2010.

There was also the point that because of the LASPO Act there would be more unrepresented appellants in the Upper Tribunal, which has already been mentioned on a previous debate. One cannot help feeling that the real reason the Government have got to this point is concern that the rights of immigrants and asylum-seekers,

4 Dec 2012 : Column 604

never a popular minority, are being subordinated to the need to ration scarce judicial resources. As the noble and learned Lord, Lord Brown of Eaton-under-Heywood, put it, and quoted with approval in PR (Sri Lanka):

“The rule of law is weakened not strengthened if a disproportionate part of the court’s resources is devoted to finding a very occasional grain of wheat on a threshing floor full of chaff”.

Personally, I cannot think of any more compelling circumstances than the risk that a person may be tortured. I am sorry if the Government do not agree with me. I beg to move.

7 pm

Lord Ahmad of Wimbledon: My Lords, as my noble friend Lord Avebury has explained, his Amendments 108ZA and 108A also relate to the second-tier appeals test. These amendments seek to remove immigration and nationality appeals, or alternatively those relating to the Refugee Convention or the European Convention on Human Rights, from the scope of the second-tier appeals test. We debated similar proposals in Committee on 4 July.

As my noble friend Lady Northover said at that time, the Government fully appreciate the serious nature of these kinds of appeals, as do the courts. In fact, the immigration and asylum chambers in the First-tier Tribunal and Upper Tribunal were created expressly to deal with these matters and are composed of judges who are experts in this particular area. The Government remain satisfied that they provide the expert rigorous scrutiny that is required in appeals of this kind.

It is therefore the Government’s view that it is neither necessary nor desirable to make it easier for appeals to continue on to a third judicial hearing, unless there is a very good reason for doing so. The test which is applied at present is either that the proposed appeal would raise some important point of principle or practice, or that there is some other compelling reason for the relevant appellate court to hear the appeal.

Removing the test in these cases could see the Court of Appeal in receipt of a high volume of cases which would not have been granted permission under the second-tier appeals test and which may further slow down decisions on some of the most important cases heard there. The test allows judges to determine which cases have a compelling reason to reach the Court of Appeal, a situation which the Government are keen to see continue.

My noble friend also raised the issue that the Court of Appeal in PR (Sri Lanka) ruled that the second-tier appeals test did not allow permission to appeal for individuals facing torture or death on their return to their country of origin. The judgment in this particular case upheld the current system and the suitability of the Upper Tribunal to make decisions on matters of this nature. The judgment specifically states that:

“The two tiers of the Tribunal system are, and are plainly to be regarded as, competent to determine matters of this kind”.

It then goes on to say:

“In short, there is no case for contending that the nature of an asylum-seeker’s case which has failed twice in the Tribunal system is a compelling reason for giving permission for a further appeal”.

4 Dec 2012 : Column 605

These cases have already been heard in the most appropriate part of the system and the second-tier appeals test allows sufficient discretion for judges to grant permission to appeal where they see that there is a compelling reason to do so.

My noble friend Lord Avebury is someone who I personally regard as a great champion of human rights and he is someone who has stood firm in ensuring that, where there is torture across the world, people who come to this country are fully protected. I totally align myself with the sentiments that he has expressed. However, the position of the Government is clear. Finally, I would add that the courts have been clear that there is no reason to believe that the United Kingdom would be in breach of any international obligation if appeals from the Upper Tribunal are available only under the second-tier appeals test.

I would therefore urge my noble friend to withdraw his amendment.

Lord Avebury: My Lords, I am most reluctant to withdraw the amendment, but I can see that at this point in the Bill it would be purposeless to press the matter to a Division. I can say only that I am really disappointed in the reply that I have had from my noble friend. I am sure that I am not going to be the only one to feel that emotion. I know that the Immigration Law Practitioners’ Association has submitted a detailed argument on this matter to the Government as well to your Lordships who are likely to take part in this debate. I do not feel that adequate justice has been done to the force of its arguments. But, as I say, I do not see any reason why I should press this to a Division this evening. I therefore beg leave to withdraw the amendment.

Amendment 108ZA withdrawn.

Amendment 108A not moved.

Amendment 108AA

Moved by Baroness Deech

108AA: Before Clause 21, insert the following new Clause—

“Appeals relating to regulation of the Bar

(1) Section 44 of the Senior Courts Act 1981 (extraordinary functions of High Court judges) ceases to have the effect of conferring jurisdiction on judges of the High Court sitting as Visitors to the Inns of Court.

(2) The General Council of the Bar, an Inn of Court, or two or more Inns of Court acting collectively in any manner, may confer a right of appeal to the High Court in respect of a matter relating to—

(a) regulation of barristers,

(b) regulation of other persons regulated by the person conferring the right,

(c) qualifications or training of barristers or persons wishing to become barristers, or

(d) admission to an Inn of Court or call to the Bar.

(3) An Inn of Court may confer a right of appeal to the High Court in respect of—

(a) a dispute between the Inn and a member of the Inn, or

(b) a dispute between members of the Inn;

and in this subsection any reference to a member of an Inn includes a reference to a person wishing to become a member of that Inn.

4 Dec 2012 : Column 606

(4) A decision of the High Court on an appeal under this section is final.

(5) Subsection (4) does not apply to a decision disbarring a person.

(6) The High Court may make such order as it thinks fit on an appeal under this section.

(7) A right conferred under subsection (2) or (3) may be removed by the person who conferred it; and a right conferred under subsection (2) by two or more Inns of Court acting collectively may, so far as relating to any one of the Inns concerned, be removed by that Inn.

Baroness Deech: My Lords, I rise to speak to Amendments 108AA and 122AA.

In brief, these amendments seeks to transfer the jurisdiction for appeals by barristers—or in some cases the Bar Standards Board—against certain disciplinary matters from the visitors to the Inns of Court to the High Court. The transfer of the visitors’ jurisdiction is something that the senior judiciary and the Bar Standards Board have been working towards for a number of years. We welcome an opportunity to get this into the law. I trust that the Government will accept these amendments.

The background is that judges have long exercised an appellate jurisdiction in relation to the regulation of barristers. Since 1873, judges of the High Court have been exercising this function as part of their so-called extraordinary functions in their capacity as visitors to the Inns of Court. In exercising this jurisdiction, the law being applied is derived from the constitution of the General Council of the Bar and the Inns of Court to which all barristers subscribe.

For some time, the Bar Standards Board has been in discussions with the judiciary about transferring the jurisdiction formally to the High Court. The current system is anachronistic and there is general agreement that it should be updated. As these appeals are already heard by High Court judges, the main impact of the change would be to enable these cases to be dealt with in the usual manner via the normal list in the Administrative Court. This is consistent with the disciplinary arrangements for solicitors and would save time and administrative burden for the courts service.

The clause was previously included in the draft Civil Law Reform Bill in the previous Parliament, but it was unable to be proceeded with for lack of time. This is why I hope the Government will now accept it. I beg to move.

Lord Ahmad of Wimbledon: My Lords, as the noble Baroness, Lady Deech, has explained this new clause abolishes the jurisdiction for High Court judges to sit as visitors to the Inns of Court and confers on the Bar Council and the Inns of Court the power to confer rights of appeal to the High Court in relation to the matters that were covered by the visitors’ jurisdiction.

The Government agree with the noble Baroness that the practice of High Court judges sitting as visitors to the Inns of Court is inappropriate. The new clause does not itself abolish appeals to visitors or automatically create a right of appeal to the High Court; it is for the Bar Council, the Inns of Court and

4 Dec 2012 : Column 607

their regulatory bodies to determine any new arrangements in this respect. However, once the clause is commenced, the practice of High Court judges sitting as visitors in exercise of their extraordinary functions as judges would cease. This is achieved by repealing Section 44 of the Senior Courts Act 1981 in so far as it confers jurisdiction on High Court judges to sit as visitors to the Inns of Court and enabling instead a right of appeal to be conferred to the High Court for barristers and those wishing to become barristers.

The role of judges as visitors is long-standing but somewhat opaque. Repealing the current jurisdiction and conferring express powers to create rights of appeal in respect of the relevant decisions is preferable because it promotes clarity and certainty, which are rightly the aims of modern law.

As the noble Baroness, Lady Deech, has proposed, the power to confer rights of appeal to the High Court would be available in relation to all matters in respect of which the visitors currently have jurisdiction. Under the current regulatory arrangements of the Bar Council, the visitors’ jurisdiction includes disciplinary decisions of the Council of the Inns of Court and decisions taken by the Bar Council’s Qualifications Committee. It would also include disputes between Inns and their members, or those wishing to become members, in recognition that historically the visitors’ jurisdiction extended to appeals from all decisions relating to the conduct of an Inn’s affairs. Abolishing the role of judges sitting as visitors is supported by the Lord Chief Justice, the Bar Standards Board, the General Council of the Bar and the Inns of Court. Enabling appeal to the High Court instead will improve administrative efficiency and transparency, and at the same time make the appeal arrangements for barristers more consistent with those for solicitors. I am therefore grateful to the noble Baroness for bringing this matter before the House and the Government are happy to support the amendment.

Amendment 108AA agreed.

Clause 21 : Payment of fines and other sums

Amendment 109

Moved by Lord Touhig

109: Clause 21, page 18, line 8, at end insert—

“( ) In fixing such an amount, and subsequent additions, account must be taken of the person’s relevant weekly income, excluding housing benefit and child related benefits, and allowance must be made for the protection of a reasonable financial subsistence level, in the manner used to determine the initial fine.”

Lord Touhig: My Lords, the intention behind this amendment is to ensure that the new financial penalties imposed on people who make late or incomplete fine repayments do not in any circumstances force individuals or families below a reasonable level of subsistence. In particular, it seeks to safeguard the level of income necessary to sustain housing security and to meet the basic needs of dependent children. It is based upon the means-testing system already used to set fines which is accepted by the Government as a suitable mechanism for ensuring that, while offenders feel financial

4 Dec 2012 : Column 608

hardship, their welfare and that of their family is not jeopardised as a result. The noble Lord, Lord McNally, in a Written Answer to a Question I posed, stated:

“There is a very fine balance between protecting vulnerable debtors as well as ensuring that justice is served and the order of the court is met”.—[Official Report, 24/9/12; col. WA345.]

I believe that this amendment falls on the correct side of that line; it will prevent neither the penalisation of those who do not keep to their payment plans nor the unprecedented step of recovering operational costs in such cases. It will simply mean that in some situations where this process could hinder a person’s ability to pay for necessities such as rent or family meals, the precise amount recoverable will be adjusted.

The level of concern about the absence of any such safeguard in the Bill as it stands is reflected in the support for this amendment from a number of charities. These include Housing Justice, the largest Christian housing charity in the UK; the Zacchaeus 2000 Trust, a London-based charity for vulnerable debtors; Depaul UK, which works nationwide with disadvantaged young people; and the Catholic Children’s Society in Westminster, which works with some of the poorest families in this area.

I am grateful to the noble Lord, Lord McNally, for agreeing to meet me last week to discuss my concerns about this matter, but he knows that I left the meeting feeling somewhat concerned because I learnt that one of the most worrying aspects of Clause 21 is that the charging structures for the new penalties will not be laid before Parliament, but will be set following commercial negotiations with the firms contracted to collect fine payments—and this will not happen until after Parliament has passed the legislation. In effect, we are being asked to write a blank cheque for unknown contractors with no inbuilt safeguards to ensure that the most vulnerable individuals and families will be protected from threats to their basic subsistence income. With this clause, our system of justice will depend on the negotiating skills of civil servants pitted against private contractors out to make a profit.

The Courts and Tribunals Service, responding to a freedom of information request on October 3, said that the penalties will be set in proportion to the actual costs of chasing up a late or incomplete repayment. But I have discovered that the service does not hold information relating to the average cost of such processes. This means that any reasonable estimation of the likely amounts that people will be charged is impossible to make. In Committee on 2 July at col. 539 the noble Baroness, Lady Northover, admitted that in practice the actual amount may sometimes even exceed that of the initial fine. Moreover, we have seen no substantive analysis of the likely impact on children or on housing security, neither of which is explicitly addressed in the impact assessment.

The Courts and Tribunals Service, in a letter to the Caritas Social Action Network on 5 November, stated that, “we do not believe there will be significant impact on a child’s welfare”. But in another freedom of information request dated 3 September, I find that the service does not hold information on the family profiles of those sentenced to pay fines. It is therefore unable to project how many dependent children are likely to

4 Dec 2012 : Column 609

be affected. Similarly, the absence of information on the housing situations of those currently failing to meet fine payment plans prohibits any projection of how the new penalties will affect people’s ability to meet rent payments. In a letter to the Caritas Social Action Network, the service sought to provide reassurance by predicting that the penalties will be “small and proportionate”. But as those with experience of working to support people in financial hardship will know only too well, any amount regarded as small in some circumstances will in fact be very significant in others. This is particularly significant at a time when an increasing number of families are struggling to meet the costs of essentials including heating, food and rent. Even a small change in their income will often have serious consequences.

7.15 pm

I hope that the Government recognise the danger of legislating for unspecified financial penalties without providing any safeguards that allow for downward adjustment in cases where people risk being so severely affected. Such safeguards are all the more important considering that the penalties will be processed using a new and untested computer system which the Government have not yet even purchased.

As it stands, Clause 21 also raises the prospect of consequences relating to payday loans, an issue I know to have been of concern to many noble Lords in recent days. Increasingly, those facing financial difficulty turn to these loans as a short-term solution, yet as we know, all too often they serve only to exacerbate hardship in the long run. It is against this backdrop that I have found, again through a freedom of information request, that neither the Ministry of Justice nor the Department for Work and Pensions have made any assessment of the relationship between payday loans and fines, either in the context of this Bill or more broadly. Payday loans and the frequently unsustainable levels of interest that accompany them may be both a cause and a consequence of somebody failing to meet their fine payment plan. It would be unwise to risk exacerbating this situation by the imposition of further non-means-tested sums without any thorough analysis.

The Government have rightly said that offenders who run into difficulty can contact the court to explain their situation, and that is most welcome. However, in many cases people in hardship fail to utilise these options, and while they may be penalised for that, it is important that their fundamental well-being is not put at risk as a result. It is also worth noting that despite government assertions that Clause 21 is aimed at deliberate evaders or fine dodgers, there is a range of other reasons why somebody may miss a payment without getting in touch. It could be the result of other unexpected costs, the pressures of a family breakdown, a misunderstanding of the system, or in some cases even a lack of phone credit to get in touch. People with addictions, mental health problems or poor literacy skills may be even less likely proactively to contact the court when it becomes apparent that they will struggle to make a payment. Indeed, in another Written Answer the noble Lord, Lord McNally, told me that the Government,

4 Dec 2012 : Column 610

“does not collect detailed offender profile information which shows the reasons why offenders fail to comply with their payment plans for fines”.—[

Official Report

, 17/7/12; col.



The presumption of deliberate evasion is not only unfounded, but may also risk unduly burdening already vulnerable people.

Finally, I turn to the comments of the noble Baroness, Lady Northover, in Committee. She said that,

“if on experiencing financial hardship a person wishes to appeal or to be referred back to the court, the court will have the discretion to remit part or all of the administration costs following consideration of all the issues”.—[

Official Report

, 2/7/12; col. 538.]

While that option is reassuring, given that the average cost of an appeal is in excess of £360, it would surely be more effective from a cost-saving point of view to have an inbuilt safeguard that will prevent the imposition of these costs pushing people below a reasonable subsistence level. Similarly it is important to take account of the public costs that will be incurred should a person and his or her family need emergency accommodation or the intervention of social services in the period between a penalty being imposed and a court appeal. Even more significantly, we know that many people—again for a range of reasons—will have neither the capacity nor the confidence ever to make the appeals themselves.

As I said in Committee and repeat now, I do not oppose the principle behind this clause. I firmly believe that people must face up to their financial responsibilities by meeting the fines in full and on time. However, in cases where they fail to do so, for whatever reason, there must be protections against additional costs recovery cutting into the minimum income required for their most basic needs—a roof over their heads and a means to feed themselves and their children. Before giving contractors the power to impose new penalties we should, as a minimum, ensure that some options of downward adjustment are available for the most severe cases. By simply extending the current means-testing system that is already successfully applied to fines, we can avoid pushing people into poverty, increase the likelihood of full payment and prevent expensive appeals. I beg to move.

The Earl of Listowel: My Lords, I support the amendment and—

Lord McNally: My Lords, because I have three amendments in this group it may be helpful if I intervene now. I will, of course, respond at the end of the debate to the points that are made.

I pay tribute to the noble Lord, Lord Touhig, who has a personal commitment to and involvement in this area. I found our recent meeting extremely useful. On fee levels, I am advised that it is normal practice at this stage of the legislative process not to set fee levels. It is certainly not unprecedented. Perhaps I may also take up the point the noble Lord made in closing. We are talking about fines imposed by the court. There is a responsibility on the offender to pay those fines and a responsibility on the Government to put in place a means of collecting them. It is also important that we

4 Dec 2012 : Column 611

look at making affordable financial penalties so that they do not produce the devastating impact that the noble Lord referred to.

The Government take the view that the recovery of collection costs provided for in Clause 21 differs greatly from means-tested fines. A fine is a financial penalty imposed by the court as punishment for a criminal offence. The level of fine is based on the seriousness of the offence and the offender’s ability to pay. On the other hand, collection costs are administrative charges which would apply only as a means of recovering the costs of collecting a fine following a default. They are not intended as a further punishment. The collection costs will be proportionate and have a direct correlation to the actual costs of collecting the unpaid fine. To introduce a means-tested charge, as the noble Lord suggests, would create a complex and resource-intensive administrative system which would increase the operational costs, thus leading to increased collection costs overall.

The Government are doing everything they can to ensure that individuals avoid defaulting in the first place and that fines are not set at a level that is inappropriate and unaffordable. We all agree that fines set at the wrong level are to no one’s benefit. The House should be aware that fines officers have the powers to determine payment plans to help individuals manage their fine payments. Furthermore, we introduced amendments to the Bill in Committee which enable the sharing of data between government departments—primarily Her Majesty’s Courts and Tribunals Service, the Department for Work and Pensions and Her Majesty’s Revenue and Customs—for the specific purpose of ensuring that fines and other financial penalties are set at the right level in the first place.

The additional charge to meet collection costs is avoidable. If a person maintains contact with the court and is complying with the payment plan or pays on time as ordered, they will face no extra costs. I re-emphasise the importance of offenders engaging with the justice system from the onset, particularly if they may have difficulty in paying the fine immediately. It must be remembered that should an individual suffer hardship, they can have their case referred back to the court, which can remit all or part of the collection charges. This provides a strong safeguard. However, it must not be forgotten that ultimately it is the offender’s obligation and responsibility to comply with a court order.

The noble Lord, Lord Touhig, questioned whether it was right to bring forward legislation without setting out the proposed collection costs structure. It is perfectly correct for Parliament to agree the principle of collection costs before the exact costs are finalised. As I said earlier, the collection costs will relate to the direct costs of enforcing an unpaid fine. Therefore, until we commence the procurement tender for fine collection services and see the proposals and costs of the bids, we are unable to give an indication of what the exact collection costs will be. However, I can assure noble Lords that companies will not be able to charge disproportionate fees in order to make a profit and we will publish a revised impact assessment before commencing these provisions.

4 Dec 2012 : Column 612

Government Amendments 110 and 123 create new powers for Her Majesty’s Courts and Tribunals Service to access data held by Her Majesty’s Revenue and Customs for the purpose of enforcing outstanding financial penalties. These new powers will complement those that I have already described in relation to data sharing prior to sentencing. These measures will help Her Majesty’s Courts and Tribunals Service enforce unpaid fines and compensation orders by allowing the courts to obtain additional information on defaulters for more effective and targeted use of attachment of earnings orders.

Under the Courts Act 2003, courts are already able to access an offender’s social security information from the Department for Work and Pensions if the offender has defaulted on the payment of their fine or compensation order and the court is trying to enforce payment. The government amendment will extend these data-sharing arrangements to cover information held by Her Majesty’s Revenue and Customs—for example, earnings from employment.

Amendment 115 makes a technical amendment to Schedule 16 to ensure Her Majesty’s Courts and Tribunals Service can access the full range of information held by the Department for Work and Pensions for the purposes of sentencing an individual.

We treat data protection extremely seriously and, like all our other data-sharing provisions, these provisions are subject to rigorous safeguards. Accordingly, data will be shared only with authorised individuals in Her Majesty’s Courts and Tribunals Service, which may use the information only for the purpose of enforcing an unpaid financial penalty. If the information is supplied or disclosed for any other purpose, with certain specific exceptions, the person supplying the data will be guilty of a criminal offence punishable by up to six months’ imprisonment. The Information Commissioner’s Office has been consulted and has welcomed the proposals on the basis that access to shared data will be limited and will be used for specific purposes. I hope that enables a more rounded debate.

7.30 pm

The Earl of Listowel: My Lords, I am grateful to the Minister for intervening in that helpful way and for giving that information. I have put my name to the amendment because I share the concerns expressed so eloquently by the noble Lord, Lord Touhig.

It is a naughty time, particularly for the most vulnerable and impoverished families. It is a very hard time and children need enduring and reliable relationships above all. We would want that for all children. The difficulty is that when families are pushed to the very edge it becomes more and more difficult for them to be in reliable and enduring relationships with their children. Pressures are put on the parental relationship and on the attention that parents can give to their children. We heard from the noble Lord, Lord Touhig, about concerns that parents are so short of money that they cannot afford to heat the home and put food on the table. What sort of pressure does that put on the family when parents cannot look after their family in that way? I am aware of this from meeting parents,

4 Dec 2012 : Column 613

mostly mothers, of families in temporary accommodation provided by Barnardo’s and also from going out on visits with health visitors and speaking to mothers. It certainly helped me to understand how, in the past, parents have really struggled on the edge of society. Today, in these circumstances and in the financial conditions we are in, it is hard to conceive how difficult it must be for some families to care for their children as they need to.

I am worried about this and am very grateful for the care that the Minister has taken in taking this forward. I was pleased that he could meet the noble Lord and I was sorry I was not able to join that meeting. What he said is certainly helpful, although I am looking at my notes of what he said to see whether there is anything I can come back on now. I do not think there is. I will finish at this point and look forward perhaps to hearing a little more reassurance in his final comments.

I share the concern of noble Lords that we must do everything possible to protect the most vulnerable families at this very difficult financial time. Many of these families are quite chaotic. They may not open their letters and may be in all sorts of messes. There are also people who prey upon them. Just last week I was speaking to a care leaver in her second year at university. She came from an estate in Stockport where she said there were no expectations—she was expected to have children in her teenage years and that would be her life. However, she has gone on from care to university, where she is now in her second year reading law. She says that when she goes back home, there are three predatory loan sharks on her estate. They will lend money—£250 for Christmas but if you do not pay it back by June next year you have to pay £500. There are all sorts of people who prey on these vulnerable families so, as far as possible, we need to protect them as we legislate here today.

Lord Beecham: My Lords, I also strongly sympathise with my noble friend’s amendment, in particular in connection with his reference to the cost of collection. I suspect we will return to that issue when the noble Baroness, Lady Meacher, moves her amendment in relation to bailiffs, because, as was mentioned in Committee and no doubt will be mentioned again today, the cost of collection is often wholly disproportionate to the amount of the fines, particularly when it is in the hands of private firms contracted to either local authorities or the courts. It is quite a different matter when the courts have their own collection services run by their own staff.

There will be considerable concern about the potential direct costs, and the indirect costs, if families are driven further into poverty and we have the problems of homelessness, children being taken into care and the like. It seems that the Government’s intention to outsource this work is likely to aggravate what might be a difficult problem in any event. Clearly, the Government are not going to make any further move on this. That is a matter for regret and certainly something that we will have to keep a collective eye on in future, particularly the likely impact on local authorities if things go wrong and families are unable to maintain the costs.

4 Dec 2012 : Column 614

It is perfectly true that those who receive a financial penalty are obliged to pay it, but the likelihood is that it will not just be them who suffer but their dependants. That has financial as well as social implications. I had hoped that the Government would react rather more positively to my noble friend’s amendment but it does not look as if that is likely to happen. That is a matter of regret and it will be for my noble friend to decide whether he tests the opinion of the House at this very late stage. I suspect he may well not do so, but the issue will not go away. We will undoubtedly want to probe whatever arrangements are ultimately made with those who will be responsible for making these collections.

Lord McNally: My Lords, I am grateful for those interventions. The points made by the noble Lord, Lord Touhig, the noble Earl, Lord Listowel, and the noble Lord, Lord Beecham, are undeniable. There are people whose lives are so dysfunctional and chaotic that they can get into a complete downward spiral in how they manage their lives. It is extremely important that we try to make sure that what happens to them does not make that downward spiral worse.

I am pleased that the noble Lords, Lord Beecham and Lord Touhig, acknowledge that we are dealing with people who have offended, who have been before a court and who have been given a fine. As I said in my opening remarks, if they follow the instructions of the court, they should be able to avoid the worst of the kind of downward spirals that both the noble Earl, Lord Listowel, and the noble Lord, Lord Touhig, referred to. As a former Member of Parliament for Stockport, I could take a rough guess at the estate from which the young lady who was mentioned came. Her story is the other side of the penny to what can sometimes be the bleakest of stories. I have a great-niece who works for Blackpool social services and the stories that she tells me of the sheer dysfunctionality of the some of the families that she has to deal with are out of the range of most of our normal lives.

I do not underestimate this and although I will ask the noble Lord, Lord Touhig, to withdraw his amendment, I emphasise again that, in cases where the most vulnerable are sentenced to pay a fine, it may be deemed appropriate for the court to issue a deduction from benefits order, where a maximum level, which is currently set at £5 a week, can be automatically deducted from the person’s benefits to pay their financial penalty. This is capped at a level so that it does not significantly impact on the person or cause further hardship. This maximum weekly deduction from benefits will not be increased by the introduction of the collection costs, so there is some safety net there.

As I said in opening, the costs will be set at a level that is proportionate to the actual costs of collecting the fine. We are trying and we will be returning to this when we debate the amendment of the noble Baroness, Lady Meacher. On the one hand, we have to be aware of these dysfunctional individuals and families who come into the justice system. However, we have to operate that system and try to get the balance right between the instilling of proper responsibility when it comes to fines imposed by the court and the collection of those fines, so that they do not become a kind of option but are real and we have the means of making

4 Dec 2012 : Column 615

sure that they are enforced. At the same time, we must try to ensure that a just punishment of the court does not spiral into unjust impacts on other individuals associated with the person who has to pay the fine.

These are difficult and complex decisions. We hope that we have got them right. I certainly do not object to the noble Lord, Lord Touhig, bringing this matter before the House and his continuing interest in this area. I assure the House that the Government will continue to examine this carefully to see what reforms we can bring forward. The noble Earl, Lord Listowel, referred to the operation of loan sharks. That is something that we need to look at with some urgency as well. In the mean time, I ask the noble Lord, Lord Touhig, to withdraw his amendment.

Lord Touhig: My Lords, when the Minister came to the Dispatch Box straight after I spoke, I did feel a sense of excitement—I thought he was going to accept my amendment. I thought, “My goodness, there is another Christmas card I will have to send this year”. I am disappointed that the Government do not feel able to support this perfectly reasonable amendment. I fully understand the point the noble Lord makes and I share the view that people who commit offences and are fined should pay those fines. However, I am sure that nobody in this Chamber knows the level and degree of poverty that the people we are talking about tonight experience. The fines might not be a large amount to us but £15 is two weeks’ electricity for a poor family. I fully accept that those who commit the crime should pay the penalty but it is their children and other dependants who ultimately pay the price and suffer far more, perhaps, than the people who are brought before the courts.

I welcome the noble Lord saying that there will be a further impact assessment. Perhaps I may tease him with this idea. Is he prepared to have some discussions about what could be included in that impact assessment? Those of us who have concerns, such as the noble Earl, Lord Listowel, and others, might be able to suggest what should be looked at. In that way, we might arrive at better legislation that will not make victims of the children and dependants of people who commit these crimes, who are innocent in all these matters and will have a more difficult life as a result.

Lord McNally: As I said in my opening remarks, I know how deeply concerned the noble Lord and the noble Earl, Lord Listowel, are about these matters. I would be glad to have further talks with them on what is to be covered by an impact assessment.

Lord Touhig: What can I say? I am most grateful to the Minister and he will certainly be on my Christmas card list. In view of the lateness of the hour, I do not intend to test the opinion of the House at this stage. I am most grateful for the comments made in the debate and I beg leave to withdraw the amendment.

Amendment 109 withdrawn.

Consideration on Report adjourned until not before 8.43 pm.

4 Dec 2012 : Column 616

Future Homes Commission Report

Question for Short Debate

7.43 pm

Asked by Baroness Whitaker

To ask Her Majesty’s Government what is their response to the report by the Future Homes Commission Building the Homes and Communities Britain Needs.

Baroness Whitaker: My Lords, when I first became interested in housing decades ago, the late and much lamented Victor Rothschild, then head of the Government’s first think tank, the Central Policy Review Staff, said, “Is it impossible to have a sensible housing policy?”. That problem has never seemed solved to me, and this is confirmed by the very good Library note rounding up government initiatives—of which there have been several—ideas from many experts and some very sad statistics.

However, this new report, by an independent commission set up by the Royal Institute of British Architects, makes a very good stab at a large part of the solution. Its members are neither developers nor architects nor planners, but an eminent businessman and public servant as chair, Sir John Banham; a retired civil servant of great distinction, Dame Mavis McDonald, whom I remember as a rising star in the then Ministry of Housing and Local Government; and two more very distinguished members, the criminologist and film-maker, Roger Graef, and the property analyst, Kate Faulkner.

This commission took a sharp and clear look at what is generally recognised to be a dire housing situation: nearly 2 million households currently on the housing list, well over 50,000 homeless, and more than that in temporary accommodation. As Professor Steve Nickell put it, the queue for social housing has doubled since the turn of the century. The private sector is not delivering either, and planning laws are not the problem: there are 400,000 outstanding planning permissions for residential housing. We have been underinvesting in domestic housing for a long time.

The commission found another problem, less often commented on: the quality of new-build homes is now so poor that only one in four people would consider buying one. Most people would choose to buy a century-old home, with all its high running and maintenance costs, rather than one of the poky and poorly designed homes, with too little storage space, too little natural light, poor privacy and noise protection, difficulties in adapting to different needs and general dinginess, which are all too common now in this country, which was once the envy of Europe for its domestic housing but is now falling far short of the space standards in the rest of Europe.

The commission’s remedies are equally clear. To summarise very crudely, it points out, first, that we must have a threefold increase in the number of new homes built every year, from 100,000 to 300,000—and incidentally, the idea that there is insufficient space for building is proven to be a myth, with only 11% of our land built on and plenty of brownfield land;

4 Dec 2012 : Column 617

secondly, that funding for this could be kick-started by a pooling of 15% of local authority pension funds assets into an independently managed local housing development fund, investing in both rental and shared ownership housing; thirdly, that we can no longer try to provide proper homes without strengthened design standards; and, finally, that home buyers and communities must have the kind of information that enables them to make an informed choice, and that local government is the paramount institution for taking all this forward.

This very quick summary hardly does justice to the well argued and well evidenced proposals of the commission. The investment proposals are particularly well worked out. I urge noble Lords to read the report for themselves. It is not long and it is written with exemplary clarity.

I would like to move on to what can be done now. The funding process is all-important in these hard times. The Pensions Institute’s latest report draws attention to the deficit suffered by many funds, so a 6% return, likely under the commission’s proposals, would be very welcome. Can the Minister tell me whether the Government have looked at what barriers there might be to local government pension funds pooling their assets and how these could be overcome? Can she set in hand a review of local government pension fund investment regulations to make wide investment in local infrastructure and housing a practical possibility? My noble friend Lord Rogers, who very much regrets that he cannot be here tonight, told me that in Canada pension funds invest in development. Perhaps the department could have a look at the Canadian system.

As for quality, do the Government acknowledge the extraordinary importance of good design, of the total place as well as the home itself, for the well-being, security and prosperity of our citizens? If the Minister accepts this—as I am sure she does—will she look again at the need for space and storage standards? If the Mayor of London can achieve them in London, why should the rest of the UK be deprived of their benefit? Will this form part of the current review of housing standards? Let us also acknowledge that if a new housing development is attractive and of high quality, sensitively attuned to place, residents are very much less likely to object.

There are other powerful recommendations relating to transparency and better information, and which address the current fragmentation of the development process, which noble colleagues will deal with. I welcome the great expertise of the speakers in this debate.

I simply want to draw the attention of this House and the Government to the supremely well informed and clear pathway out of the quagmire of our senseless housing situation presented by this report, and urge action. It was the planning Minister himself, Nick Boles MP, who said last week that having a house with a garden was a basic moral right, like healthcare and education. While I am not too sure about the garden, the idea that a decent home for everyone is fundamentally important does not seem to be comprehensively lodged in government policy. Someone tweeting a response to the report said:

4 Dec 2012 : Column 618

“I think the important thing would be to ensure that appropriate accommodation and shelter is recognised as the human right that it is supposed to be”.

Now can we have a sensible housing policy?

7.50 pm

Baroness Maddock: My Lords, I thank the noble Baroness, Lady Whitaker, for initiating this important debate. I do not know if she is aware of it but today the leader in the Times led on the need for more housebuilding and highlighted some of the issues which she has already highlighted tonight and we will discuss further this evening.

We on the Lib Dem Benches find that there is much to support in the report to the Future Homes Commission. As Lib Dems our party policy is developed by our party members and is vigorously discussed before being voted on at our party conferences. Last September we passed a policy paper called Decent Homes for All. In it we set out plans to get to building 300,000 homes a year. The Future Homes Commission report also calls for this.

Perhaps I may highlight a couple of things that we have done in coalition Government. The Government have allocated £500 million to the Growing Places Fund, which is aimed at kick-starting stalled housing projects. The Infrastructure (Financial Assistance) Act earmarks £10 billion of Treasury investment to go towards helping what we call “shovel-ready” housing projects to get started. I am pleased to say that in the recent issue of InsideHousing, which I get every week, figures showed that,

“the decline in new house building has stabilised after more than a year of steady falls”.

That is some good news on this front.

The commission report suggests that more land be made available, and makes a convincing case for suggesting that this is achievable without damaging communities, as is often feared. I think that the noble Baroness referred to that. In our Liberal Democrat policy paper we also identified the need to increase the supply of land and we suggested a pilot of community land auctions where local authorities could designate an area for auction. In addition we proposed a stronger consideration of “use it or lose it” in planning policy. At the moment people can just start on a site and it is assumed that development is going to go ahead and that they have continuous permission. I understand that the Government have looked at this and that trying to draw up a workable policy is proving rather difficult.

There are other areas where the commission report, our party policy and government policy coincide, including one of the areas to which the noble Baroness referred—the use of pension funds. The policies do not all look specifically at local authority pension funds, but in the 2012 Budget the coalition Government, of whom we are part, announced plans to establish a new pension infrastructure platform owned and run by the UK pension funds. This was to help invest an initial £2 billion in UK infrastructure, which may include housing, by early 2013. I understand that seven funds are already signed up and expect to deliver this initial £2 billion in January. The Government are also working with other private-sector pension funds to encourage them to

4 Dec 2012 : Column 619

invest in UK infrastructure projects. We heard from the noble Baroness that this has been very successful in other countries.

Given that the Liberal Democrat Party is the only party that has always been in favour of localism—the devolution of decision-making to local authorities—we strongly agree with the call for local authorities to take a leading role in housebuilding, using their powers to work with local people, organisations and developers in their area to create attractive developments that people want to live in. This is also in line with what local authorities are calling for themselves. I declare an interest as a vice-president of the Local Government Association. I understand that it is having a conference on 19 December which is entitled, “Housing the Nation, Financing New Homes”. I know that my noble friend Lord Greaves will touch on this, but I am aware that the ability of local authorities to deliver affordable housing in all parts of the country is not the same. As he will point out, in some areas it proves rather difficult.

One of the areas with which I strongly agree in the commission report is the need to improve design standards and for sustainable, aesthetically pleasing developments. Again, the noble Baroness referred to this. In my experience British builders have traditionally been conservative in their approach and often kicked against new building regulations and ideas. In addition, as a nation we have never developed a system where you are required to have qualifications to operate as a builder. Any one of us in this Chamber could set up as a builder tomorrow. No specific qualifications are needed.

This is an important debate and we have only a short time to deal with it. I look forward to the noble Baroness’s answers, particularly on the issue of how we can deal with improving standards, not only aesthetically but also making our houses sustainable and making the sort of houses that people want to live in.

7.56 pm

Lord Best: My Lords, I am very grateful to the noble Baroness, Lady Whitaker, for securing this debate and for her excellent opening speech. We have been blessed over the past few weeks with a string of important new reports on housing, of which the readable and sensible one from the Future Homes Commission, as described by the noble Baroness, is particularly valuable. For my sins, I have also read most of the others. In my five minutes, perhaps I could reflect on their messages and on overarching conclusions that can be drawn from all of them.

We have had four reports concentrating on the private rented sector, in particular on the role of lettings agents, from the Property Ombudsman, Shelter, the RICS and Which?. They all argue for more consumer protection in the private rented sector, which has grown so dramatically in recent years. We have also had the annual monitoring report on the state of the nation’s housing from the Chartered Institute of Housing, Shelter and the National Housing Federation. I fear that its traffic lights are nearly all red, or at best amber, confirming that housing remains a highly problematic issue, particularly for those who rely on housing benefit.

4 Dec 2012 : Column 620

Another report during the last few weeks has come from the Smith Institute, looking at how local authority pension funds could finance local investment. This proposition has been taken forward in the Future Homes Commission report, which notes that just £10 billion of the £180 billion invested in these pension funds could finance a serious housebuilding programme. Reporting for the Government, Sir Adrian Montague has looked at channelling institutional investment into market renting; that is, “Build to Let” schemes, which would create new homes for rent with professional management. The Building and Social Housing Foundation also launched a report on building more homes for market renting. It notes that the most likely partners for institutional investors are not the private developers, since they have little experience of the rented sector, but those large housing associations which are willing to diversify into market renting in addition to—but not in substitution for—their role in providing affordable housing.

Meanwhile, a report from the Chartered Institute of Housing, the National Federation of ALMOs and the Association of Retained Council Housing, Let’s Get Building, points out that councils could themselves address the need for new affordable homes for rent if they were given more headroom to borrow to build. Despite the recent localising reforms to the housing revenue account, local authorities still cannot act like a housing association and borrow prudently against their considerable housing assets.

The last report I have time to mention—and what a flurry of new reports there has been in these past few weeks—is the All-Party Group on Housing and Care for Older People’s new offering Housing our Ageing Population: Plan for Implementation. This adds an extra dimension to the others by pointing out the huge advantages of concentrating on building high-quality apartments for our older population. Retirement housing has highly significant benefits in terms of health, well-being and the relief of loneliness, while making big savings for NHS and social care budgets. Perhaps best of all, building to meet these needs brings thousands of family homes, some in need of the input of energetic young households, on to the market, multiplying the total number accommodated.

Putting the Future Homes Commission’s excellent document alongside these other contributions, what overarching conclusions might one reach? First, all are agreed, as are the Government, not least the very committed Minister for Planning, Nick Boles, that we need a huge increase in housebuilding to meet the nation’s needs. Secondly, in relation to the wider economy, these reports all highlight the direct contribution to GDP made by constructing new homes. If there was a return to the level of building of just a few years back, even though that was not keeping pace with the demand from new households, it would add 1% to GDP, taking us out of recession at a stroke.

Thirdly, all agree that local councils are the central players for housing provision, not only in their role as local planning authorities but as primary partners with housing associations and developers and as direct providers themselves. It may well be local authority

4 Dec 2012 : Column 621

pension funds that will provide the extra capital for housebuilding needed during this continuing credit crunch.

Finally, we need an emphasis on good design as the key to ensuring all this investment lasts and that new development gains public acceptance. Perhaps this is of the greatest importance in relation to housing for older people. Unless the design of new accommodation means plenty of light, space and air, with big windows and balconies, storage space and good ventilation, older people will never be attracted to right-size and leave their family-sized accommodation, even though it may well be increasingly difficult to manage, expensive to heat and with problematic stairs and steps. The message from the HAPPI report, as well as from the excellent report of the Future Homes Commission, is that unless we recognise the significance of good design, all our other efforts in seeking to address the nation’s acute housing problems will be a waste of time and money.

8.02 pm

Lord Sawyer: My Lords, I thank my noble friend Lady Whitaker for engaging with this excellent report. We went together to the launch. It is clear, to the point and exactly the kind of thing we need.

In the short time I have available, I shall follow the previous two speakers and say more about a bit of a hole in the Government’s policy, which is design. Their policy covers many important aspects of housing but it does not say very much about design, and this report does. There is poverty of expectation about design and space. No one in the supply chain, whether bankers, building societies, developers or even the Government, talk about it enough or promote it. It is absent. Consequently, people get limited choice from developers who stick with the standard design. It is easy and cheap to produce boxes with two bedrooms of 12 feet by 11 feet and a living room of 15 feet by 11 feet. That is pretty dreadful really, but many thousands of such houses have been built over the past years. Yet when asked about design, witnesses report that people have aspirations. They like large windows, natural light and large rooms with high ceilings—all the things that people who can afford to move away from the bottom and middle of the market buy for themselves.

Some of the homes that we build today are a disgrace, with no space for storage or for other things for the family: places to work, places to eat and separate spaces for other members of the family. International comparisons reveal that the scale of space problems is serious. We have the smallest spaces of any western European country for people to live in. Along with space, people need light. This report shows that natural light is the single most important attribute in a house, yet we now see that many homes with small standard-design windows have been built over previous years. While addressing this report, I would like to see the Government take on some of these issues.

Space, light and storage are very important and should be included in the building regulations, a point made by the noble Baroness. There should be a much more comprehensive way of getting to know what customers want and getting those things followed by

4 Dec 2012 : Column 622

builders and developers. Often today, properties are simply described as one-bed, two-bed or three-bed, which tells you nothing about design or space or what the house or flat is really about. That is totally inadequate.

There may be those who think that in a time of austerity with deep-seated problems in the housing market and many big political issues in housing, a focus on design should not be a priority. I think they are wrong. Previous speakers have said that, and the report says it. When you see how blighted and limited the lives of people can be without proper space, light or design, you see how important it is. You see couples with no storage space. If you read the report, you will see that it mentions a couple in Liverpool who bought a new-build house and have to store things in the boot of the car outside. It is amazing that these things can happen. When you see so many people with those small 15 feet by 11 feet rooms for all the family to live in and no common areas in the house for people to work in, you realise how much benefit good design could bring to the lives of those people.

Homes are important to people. After families and loved ones, homes are perhaps the most important thing. When I was a trade union official, how many times I heard people say, “Oh my God, if I lose my job, I lose my home”. I knew that the job was important, but, my God, the thing that was most important to them was their home. That is very important and we must never underestimate it. The successful Scandinavian countries spend a lot of time and energy on design and space; there must be some lessons for us there. Good design is a major contribution to the mental and physical well-being of the population, and it must be important to productivity and business success. I would like the Government to look at the chapters in the report about design and think about incorporating some of them in government policy. I am sure there will be some good ideas there and that the Government will not be too proud to take on good ideas when they are able to find them.

In particular, will the Minister comment on what current policies the Government have to improve design in new-build homes and what their thoughts are on the space, light and storage issues, the three big things that are lacking? Will the Government let us know at some time what plans they have to provide more information for consumers and, in particular, to raise the level of debate? I know it is not their job solely, but we need them to be involved in raising the level of debate in the country about design so that people can be more informed and we can get the whole thing moving in the right direction.

8.07 pm

Lord Greaves: My Lords, I, too, thank the noble Baroness, Lady Whitaker, for introducing this short debate on this very interesting and useful report. I associate myself with pretty well everything that has been said by all four previous speakers, particularly my noble friend Lady Maddock. I am particularly pleased with the emphasis in the report on design, which is so important. I think it is a little optimistic about how useful the Localism Act will be in these areas, but we will see.

4 Dec 2012 : Column 623

I shall talk about a case study of the problems and frustrations in my own area—Pendle in Lancashire—associated with trying to make a very modest contribution to affordable housebuilding in this country. I should declare an interest as a member of Pendle Borough Council. I have read what seem to be innumerable announcements and press releases while lots of schemes with interesting names have been coming out of the Government about housebuilding, but none of them seem to reach our valley up in the Pennines in east Lancashire.

We have a shortage of affordable family housing, like many areas, partly due to the fact that most three-bedroom houses on council estates have now been sold off. We have wanted to build a number of affordable family houses on council-owned land on small sites, many of which are a result of the housing market renewal programme, when the powers that be at that time would not allow us the money we needed for renovation of areas unless we knocked down a few blocks of houses. We resisted as much as we could, but some of the worst have gone and we are left with small brownfield sites. The idea was to replace what had been there with a mix of affordable houses to sell, to rent and possibly for shared ownership.

It has proved very difficult indeed to do this. In the small town of Brierfield there is a cleared site that was formerly three streets where various schemes were drawn up for 30 or 40 houses. In my own town of Colne a small, cleared site of two blocks is proving impossible to redevelop and in my own ward there are two derelict blocks of housing which are all boarded up. Many but not all of those now belong to the council; it requires a compulsory purchase order and demolition before any rebuilding can take place. That will cost, believe it or not, around £1 million and that money simply does not happen. Yet when there are sites, the money simply does not add up.

The idea is that the council provides the land for free and that the development is done by the council’s own joint venture company on behalf of the local housing association, which now operates all the former council housing in the area. One scheme of just eight houses in my own ward is now going ahead. We had hoped that it was going to be a mix of tenures; it now all has to be for rent and that only just adds up. Most of the schemes on these sites do not add up at all. The grant per unit from the Homes and Communities Agency is £21,000 to £22,000 per unit; the affordable housing unit, including the free land, might cost £95,000 to build. The ability of the registered social landlord, Housing Pendle, to pay for it does not come to more than about £70,000 to £75,000 when one takes into account the level of local rents that can be charged and the future administration and maintenance costs. There is a gap there of something around £20,000. The council has been able to plug that gap with right-to-buy receipts in one scheme, but there is a limit to those.

We want to build and it is a very modest scheme. It is necessary locally but we cannot do it, in most cases, because the money which is available and the subsidies that are available from central government via the HCA are simply not big enough to plug that gap. Like

4 Dec 2012 : Column 624

many other authorities in the north of England and similar areas, we are stuck. We want to make our own, very small contribution and it is not possible. I hope that the Minister will look at that.

8.13 pm

Lord Whitty: My Lords, I thank the noble Baroness, Lady Whitaker, the RIBA and the Future Homes Commission for producing such a good report. I declare an interest as chair of Housing Voice, which was designed 15 months ago to raise housing up the political agenda. There is no doubt that we have succeeded in that with help from a lot of others—the whole list of reports that the noble Lord, Lord Best, outlined indicates that. Indeed, we have produced our own report which comes to roughly the same conclusions as everybody else’s if we are to tackle what is a chronic dysfunction in all sectors of the housing market, we need 250,000 or 300,000 homes brought to the market in one way or another, probably for the next 20 years.

That is a colossal problem and it requires some change in long-term strategy. The Government, as the noble Baroness, Lady Maddock, said, have taken some useful initiatives, as did the previous Government, but, frankly, in terms of the size of the problem, they are tinkering. They may be successful, but the long-term problem requires a more long-term solution. Others have emphasised the lead role of local authorities in this aspect. Although I share some of the scepticism of the noble Lord, Lord Greaves, about the effect of the Localism Act 2011, at least it is a start at putting local authorities in the driving seat on housing needs in their area, assessing and helping to meet them, using neighbourhood plans and other planning to ensure that adequate homes are built for the kind of population that lives or works in their areas. However, in order for local authorities to succeed, they and/or their partners in delivering those homes need long-term access to resources.

That is the central dilemma for any long-term strategy. Local authorities have restrictions on their borrowing powers if they are to invest either in their own stock or in partnership with private developers or housing associations. There are grave restrictions in the Treasury rules on local authority borrowing. Just today, the London councils have pointed out that the cap on borrowing against their stock is actually inhibiting the ability of London to build enough homes for the population.

Another source of resources which the report identifies is institutional funds, in particular, local government pension funds. The report suggests that 15% of these assets should be invested in providing funds for housing. I have just retired as chair of a local government pension scheme member fund and I think that 15% may be a bit ambitious in terms of the attitudes of the advisers, trustees and members of the funds. Nevertheless, significant funds could be raised not only from local authority funds, but, as the noble Baroness, Lady Maddock, said, from a wider range of pension funds.

We are in an austerity period and there are grave restrictions on public expenditure, but at the end of the day some of these problems, particularly in relation to social housing, will not be resolved unless there is

4 Dec 2012 : Column 625

an increase in public expenditure over the longer term in housing. It need not be of traditional form—it could be in partnership with all sorts of partners—but some form of expenditure is needed. There is a fundamental dilemma in government spending in housing. On present plans, although the Chancellor may change them shortly, roughly £100 billion will be spent on housing over the next five or six years. The problem with that is that £90 billion of that £100 billion is to be spent on housing benefit, not on building houses. It is almost the reverse situation from that of the Macmillan Government and other Governments in the 1950s and 1960s. It is a very painful process to switch subsidy away from individuals and welfare and back into providing housing, and affordable housing. But if we do not start on that process now, it will be not only the present generation of house seekers and new family formations that find themselves in dire distress, but future generations as well.

As my noble friend Lord Sawyer has just said, for many people their house, or home, is at the centre of their quality of life. If we are to resolve this issue over the longer term we have to find a way where government support, institutional investment and private investment is directed at providing more homes, and better quality homes, for our people. It is one of the biggest issues facing this Government; at present, they have not yet matched up to it. I hope that despite his occasional infelicities, Nick Boles is taking on this task; I assume that he is not being considered for transfer to the Foreign Office, since his diplomacy needs a little bit of attention—but at least he has the drive. I hope, therefore, that the Government will begin to shape up to that task and that all who are interested in housing help them so to do.