Fortieth Report
Instruments Drawn to the Special Attention
of the House
The Committee has considered the following instrument
and has determined that the special attention of the House should
be drawn to it on the grounds specified.
A. Draft
Legal Aid, Sentencing and Punishment of Offenders Act 2012 (Amendment
of Schedule 1) Order 2014
Date laid: 31 March
Parliamentary Procedure: affirmative
Summary: This Order is laid by the Ministry of
Justice (MOJ) under powers in the Legal Aid, Sentencing and Punishment
of Offenders Act 2012 (LASPO) to amend Schedule 1 to that Act
to introduce a residence test which individuals will need to satisfy
in order to access civil legal aid, subject to certain exceptions.
The Committee notes that this exclusion is being pursued primarily
as a matter of principle since the savings to be made cannot be
quantified. It is a very sensitive matter and the House will
wish to be absolutely clear on how the residence test will operate
in practice. There are a number of operational aspects that
are still being worked out, in particular the emergency provisions
and the appeals mechanism, about which the Committee considers
the MOJ should make a clearer statement before asking the House
to approve the main Order. There are also a number of key pieces
of information still in the pipeline such as the outcome of judicial
review proceedings and reports from the Joint Committee on Statutory
Instruments and Joint Committee on Human Rights on the Order as
laid before the House. We therefore recommend that the Order should
not be debated until all the these items have been published.
This Order is drawn to the special attention of
the House on the grounds that it is legally important and gives
rise to policy matters of interest to the House.
BACKGROUND
1. This Order is laid by the Ministry of Justice
(MOJ) under powers in the Legal Aid, Sentencing and Punishment
of Offenders Act 2012 (LASPO) to amend Schedule 1 to that Act
to introduce a residence test which individuals will need to satisfy
in order to access civil legal aid services (as described in Part
1 of Schedule 1 to LASPO), subject to certain exceptions. The
Order is accompanied by an Explanatory Memorandum (EM) and a policy
statement ("the Statement").
2. This is one of a number of statutory instruments
which implement the legal aid reform proposals set out in the
document Transforming Legal Aid: Next Steps. Subject to
Parliamentary approval of this Order, the MOJ intends to lay a
further set of regulations to amend the Civil Legal Aid (Procedure)
Regulations 2012 (SI 2012/3098) to make provision for some of
the evidence requirements for the residence test for civil legal
aid summarised in the Statement attached to the EM.
JCHR REPORT
3. The Joint Committee on Human Rights (JCHR)
published a report, The implications for access to justice
of the Government's proposals to reform legal aid, on 11 December
2013.[1] In that report,
the JCHR:
- "Recommended any residence
test be introduced through primary legislation, rather than secondary
legislation, to allow for full Parliamentary scrutiny of the details
of a measure which interferes with the right of effective access
to court;
- Recommended all children should
be exempt from any residence test;
- Concluded that the test could
severely impact the right of access to court of individuals who
lack specific mental capacity, and are prevented from litigating
in person; and
- Asked the Government to consider
expanding the limited exemptions from the residence test for victims
of domestic violence."
The JCHR is yet to comment on the Government response
to the report or on the Order as laid.
PRIMARY OR SECONDARY LEGISLATION?
4. The Government responded to the JCHR's report
on 27 February.[2] In it,
the Government reasserted their view that section 9(2) of LASPO
confers a power on the Lord Chancellor to add to, vary or omit
services in Part 1 of Schedule 1 by secondary legislation. MOJ
argues that section 41(2)(b) of LASPO makes clear that secondary
legislation made under section 9 may make different provision
for different cases and may make provision by reference to services
provided for a particular class of individual. That position is
repeated in paragraph 3.1 of the EM. The Joint Committee on
Statutory Instruments (JCSI), which considers the accuracy of
the legal drafting of instruments laid before the House, has not
yet given its view on the MOJ's interpretation of these powers.
5. Although not mentioned in the EM, we are aware
that judicial review proceedings have been brought by the Public
Law Project (PLP) against the proposed residence test which challenges,
amongst other things, whether LASPO provides the Government with
the vires to introduce the test through secondary legislation.
The substantive hearing was held on 3-4 April 2014, a written
judgement will follow in the usual way, but no indication has
been given on timing. The Committee regards this as pertinent
information and suggests that it would be premature to debate
the Order before the judgment is delivered.
THE JCHR'S OTHER RECOMMENDATIONS
6. All children should be exempt from the
residence test: The Government disagree with the JCHR's
recommendation to make an exception to the residence test for
all children as a class of person. However, they have decided
to exempt applicants for civil legal aid from the test on certain
matters of law (as set out in Schedule 1 to LASPO) that relate
to an individual's liberty, where the individual is particularly
vulnerable or where the case relates to the protection of children.
These exceptions are described at paragraphs 7.4 and 7.5 of the
EM and are enacted by Article 3 of the Order. They broadly relate
to instances of abuse, forced marriage and trafficking. In response
to the consultation exercise, MOJ has also added an exemption
for cases under sections 17 and 20 of the Children Act 1989: section
17 places a general duty on local authorities to safeguard and
promote the welfare of children in need in their areas; and section
20 places a duty on local authorities to provide accommodation
for children in their area who are in need because there is nobody
with parental responsibility for the child. LASPO defines a child
as a person who is under the age of 18.
7. Those with mental capacity problems unable
to litigate in person: The Order makes specific exceptions
for detention cases. With regard to mental health and mental capacity,
the Order provides that an applicant for civil legal aid would
not be required to satisfy the test in relation to:
· the
discharge of a person liable to be detained or recalled under
the Mental Health Act 1983 or paragraph 5(2) of the Schedule to
the Repatriation of Prisoners Act 1984; or
· deprivation
of liberty authorised by: section 4B of the Mental Capacity Act
2005, an order under section 16(2)(a) of the 2005 Act, or Schedule
A1 to the 2005 Act.
8. Expand the exemptions for domestic violence:
The Government have concluded that victims of domestic violence
who apply for civil legal aid under paragraphs 11, 12, 13, 16,
28 and 29 of Part 1 of Schedule 1 to LASPO will not be required
to satisfy the residence test. This covers matters such as a person
seeking protection from domestic violence or to protect a child
from abuse, for private family law matters arising out of the
abusive family relationship, forced marriage and specific immigration
applications for victims of domestic violence. MOJ states that
this exemption from the requirement to prove a strong connection
with the UK recognises that there are certain specific circumstances
where individuals are particularly vulnerable and in need of legal
aid. The Government however do not accept that this provision
needs to extend more widely.
IMPACT
9. MOJ cannot quantify how many cases will be
affected by the changes brought about by this Order or how much
money will be saved because the Legal Aid Agency does not record
the residency status of a client. The costs will fall on providers
of legal aid and on applicants who will need to provide adequate
evidence before they can gain assistance. In supplementary evidence,
the MOJ stated:
"The residence test would be carried out
by the legal aid provider who was dealing with the application
for civil legal aid and may subsequently be validated by the Legal
Aid Agency. It will be necessary for the individual applying for
legal aid to provide documentation which establishes that they
satisfy the residence test or fall into one of the excepted categories
of person. As set out in the Impact Assessment, individuals who
do not already have evidence of lawful residence may have to pay
a fee for a copy of documentary evidence to satisfy the test if
they do not have easy access to it. Claimants may also experience
a delay in their cases whilst documentation is sought."
10. MOJ added "We recognise that there will
be some cases where the need for legal assistance is so urgent
that it is not appropriate to require the person to provide the
evidence required by the regulations or guidance when he makes
the application for legal assistance. We are considering how to
address this point in the Procedure Regulations and guidance,
for example by requiring the person to provide the necessary evidence
within a short time after the application is made."
The Committee notes this intention but recommends
that the MOJ should make a clear statement of how it will handle
emergency situations before this Order is considered by the House.
GUIDANCE ON FLEXIBILITY AND APPEALS
11. MOJ also indicates at paragraph 7.17 of the
EM that there will be "some flexibility" in the
evidential requirements for individuals whose personal circumstances,
for example, age, mental capacity or homelessness make it impractical
to supply it. The Committee therefore asked how this flexibility
is to be expressed and what the appeal mechanism would be if someone
felt they have not been treated with sufficient flexibility. MOJ
responded:
"The evidential requirements for the residence
test will be set out in legislation and guidance, as described
above and in the policy statement. Where the personal circumstances
of the client may make it impracticable for this evidence to be
supplied (either in whole or in part), that will also be set out
in regulations and/or guidance as appropriate.
The legal aid residence test will be carried
out by the legal aid provider. Where evidence of the kind set
out in the regulations and guidance cannot, because of their personal
circumstances, be provided by the individual, it will be for the
provider to determine whether they are nonetheless satisfied on
a reasonable basis that the residence test is met or that the
individual falls within an exception. The provider will need to
record on the attendance note why they considered the personal
circumstances made it impracticable for full evidence to be supplied
and the basis on which the provider nonetheless reached the view
that the test/grounds for an exception were met. This may be subsequently
validated by the Legal Aid Agency.
As part of the amendments to the Procedure Regulations
we will consider whether an individual who was refused civil legal
aid as a result of not providing evidence that they satisfied
the residence test (including in circumstances where they consider
the provider should have taken a flexible approach) should have
a right of review of that decision and a right of appeal. It is
important to note that a similar flexible approach already exists
in respect of evidence of financial means and we are not aware
of any concerns that this is failing to operate effectively. However,
as set out in the EM, the operation of and expenditure on the
legal aid scheme is continually monitored by the Ministry of Justice
and the Legal Aid Agency and a post-implementation review of LASPO
will be conducted within two to four years. That review will also
consider the operation of secondary legislation."
12. The Committee notes the MOJ's intention to
address the point but no clear statement about how the flexibility
will be applied is currently available. Legal aid providers will
make judgements that will be "validated" by the Legal
Aid Agency - we assume this means that if providers make an
incorrect assessment then they will not be paid for the advice
already given: the policy on flexibility therefore needs to be
very clear.
13. The statement from MOJ above also indicates
that it is still working some aspects of the policy out and has
not yet decided whether there will be a right of appeal for an
individual refused civil legal aid on these grounds (including
in circumstances where they consider the provider should have
taken a flexible approach to the evidence provided). The Committee
recommends that the MOJ should make a clear statement of how it
will handle appeals against the residence test before this Order
is considered by the House.
Conclusion
14. The Committee notes that this exclusion is
being pursued primarily as a matter of principle, since
the savings to be made cannot be quantified. It is a very
sensitive matter and the House will wish to be absolutely clear
on how the residence test will operate in practice. There are
a number of operational aspects that are still being developed,
in particular the emergency provisions and the appeals mechanism,
about which the Committee considers the MOJ should make a clearer
statement before asking the House to approve the Order. There
are also a number of key pieces of information still in the pipeline
such as the outcome of the Judicial Review and the reports by
the JCSI and JCHR. We therefore recommend that the Order should
not be debated until all these items have been published.
B. Draft
Licensing Act 2003 (Mandatory Conditions) Order 2014
Date laid: 9 April
Parliamentary Procedure: affirmative
Summary: This instrument replicates the Draft
Licensing Act 2003 (Mandatory Licensing Conditions) Order 2014
("the original Order"), laid on 9 February and debated
in this House on 25 March. Because the original Order was not
cleared by the House of Commons before 6 April, the coming into
force date set out in that instrument, it was rendered void. As
a result, this new Order has now been laid.
The Order adds a new licensing condition that
requires that no alcohol is supplied from licensed premises below
the "permitted price" (defined as the aggregate of the
duty chargeable and the amount of that duty multiplied by a percentage
which represents the applicable rate of VAT (currently "permitted
price" = 120% of duty due)). We do not question the evidence
that increased alcohol prices can reduce consumption, but the
anticipated effect of the "permitted price" on sales
is not clear. Supplementary material quoted in our 32nd Report
indicated that the Home Office anticipates that the policy will
reduce the average individual's consumption by one large glass
of wine a year and figures set out in the Impact Assessment indicate
that those most at risk from harm will increase their expenditure
and/or change to a cheaper product. Since our consideration
of the original Order, the Budget has reduced or frozen the level
of alcohol excise duty. The House may wish to ask the Minister
to explain how the Budget changes will affect the apparently negligible
benefits of the policy. The House may also wish to invite the
Minister to clarify the specific effects of the "permitted
pricing" policy and what direct effect it will have on reducing
alcohol-related crime and health harms over and above the established
trends illustrated by the Cardiff study. Given that the explanatory
material accompanying the revised Order does not provide any additional
explanation, we remain of the view that the effectiveness of the
policy is likely to be negligible and may, therefore, imperfectly
achieve its policy objective.
This Order is drawn to the special attention of
the House on the ground that it may imperfectly achieve its policy
objective.
15. This instrument replicates the Draft Licensing
Act 2003 (Mandatory Licensing Conditions) Order 2014 ("the
original Order"), laid on 9 February and debated in this
House on 25 March.[3] Because
the original Order was not cleared by the House of Commons before
6 April, the coming into force date set out in the instrument,
it was rendered void. The only difference between this Order and
the original Order is a small change in the title and the commencement
provision (will bring the legislation into effect 14 days after
making). The Explanatory Memorandum (EM) and Impact Assessment
(IA) laid with the Order are unchanged.
16. The Order proposes to add a new condition
to a premises licence that requires that no alcohol is supplied
from licensed premises below the "permitted price".
The Schedule to the Order sets the permitted price as the aggregate
of the duty chargeable in relation to the alcohol and the amount
of that duty multiplied by a percentage which represents the rate
of VAT chargeable in relation to the alcohol (currently permitted
price = 120% of duty due). The duty applies to the content (proof
and volume) of the container and would be the same regardless
of intended sale price. For example, the permitted price for a
litre of cider at 4% proof would be the same whether it was in
the supermarket basics range or an organic product in a designer
bottle. The EM states that the ban on selling alcohol below the
permitted price will "prevent anyone who supplies alcohol
from selling alcohol at heavily discounted prices and aims to
reduce excessive alcohol consumption and its associated impact
on alcohol-related crime and health harms."
OUR VIEWS ON THE ORIGINAL ORDER
17. When we reported on the original Order,[4]
we expressed concern about the poor quality of explanation and
the lack of evidence to support the Government's view that the
policy would be effective in reducing crime and health harms.
We concluded that, while there was evidence that increased alcohol
price could reduce consumption, the specific effect of the "permitted
price" on sales was not clear. It would not appear to fetter
competitive promotions beyond establishing an absolute minimum
price which, being set at the current rate of duty plus VAT, appeared
likely to have minimal effect. Reductions in health and crime
costs claimed in the supporting documentation seemed highly speculative
and would not offset the costs of implementing the policy.[5]
18. In response to questions raised by the Committee,
the Home Office stated that it was anticipated that the policy
would reduce the average alcohol consumption by one large glass
of wine per person per year. While there may be some impact on
moderate drinkers, figures in the IA indicated that those most
at risk from harm would increase their expenditure and/or change
to a cheaper product. The Committee concluded that the effect
of the policy appeared to be negligible and that it may, therefore,
imperfectly achieve its policy objective.
19. In a later report,[6]
we published follow-up correspondence from the Minister, commenting
that, in our view, it added nothing to the information already
obtained. The EM and IA laid with this new Order have not been
revised to address any of the points raised in our previous reports.
20. The original Order was debated in this House
on 25 March[7] and Baroness
Smith of Basildon moved a motion of regret specifically referring
to the criticisms made in our reports. At the end of the debate
the Minister, Lord Taylor of Holbeach, undertook to write to those
who had taken part setting out answers to questions raised. Neither
letter answers the criticisms made in our report or in the debate.
FURTHER DEVELOPMENTS: THE BUDGET
21. Since the original Order was laid, the Budget
included announcements of changes to the rate of duty on alcohol
from 24 March 2014:
· the
duty rate on general beer (beer between 2.8% and 7.5% ABV and
not produced by small breweries) has been reduced by 2%, as a
result an average pint of beer will be one pence cheaper;
· the
duty rates on spirits and most ciders has been frozen this year.
The freeze on spirits means a bottle of spirits will be 42 pence
lower than under previous government plans;
· the
duty rates on wine and high strength sparkling cider have increased
by Retail Price Index (RPI) only and the duty escalator on wine
would come to end. (This was the policy introduced in Budget 2008
to increase duty by 2% above inflation.) The effect of the change
is that wine duty will rise by RPI inflation (2.5%), instead of
the expected 4.5%, resulting in the addition of approximately
six pence to the price of a litre of strong cider and six pence
to the price of a bottle of wine.
The Wine and Spirit Trade Association claimed that
the Budget would save the industry £175 million in additional
duty payments.
22. These Budget measures have the effect of
reducing or freezing the duty on some types of alcohol thus reducing
the "permitted price" and counteracting the policy proposed
in the Order to the effect that this minimum price should act
as a disincentive to buy alcohol. The cost/benefit analysis
in the IA supporting the revised Order, which was laid after the
Budget, has not been amended to reflect these changes which, it
seems to us, are likely to undermine the already negligible benefits
of the policy.
FURTHER DEVELOPMENTS: ESTABLISHED TRENDS
23. Whilst we do not question the evidence provided
by Sheffield University and the Canadian experience that there
is a link between excess alcohol, crime and negative health effects,
we remain unconvinced of how the marginal effects of "permitted
pricing", as described by the Order, will produce the reductions
claimed in the EM and IA.
24. Our doubts are increased by a Cardiff University
study,[8] reported on the
BBC News on 23 April, which indicated that there is already an
established long-term fall in violent crime in England and Wales.
According to annual figures from almost a third of emergency departments
in NHS hospitals, examined by Cardiff University, there was a
12% fall in injuries from violent incidents in 2013. The study
found 235,000 people were treated following a violent attack in
2013, 32,800 fewer than in the previous year. The authors said
the rising cost of alcohol might have played a role but also that
the growth of multi-agency violence prevention involving police,
the NHS and local authorities may well be a factor; violence has
fallen more in regions where this is best organised. The report
also said that the figures mirrored other research, adding to
the evidence that the long-term trend in violent crime was down.
As a result of the 12% fall, this is the fifth consecutive year
that NHS units have recorded a decrease in violent injuries.
25. Given the large implementation costs to
the industry, the House may wish to invite the Minister to explain
what added value this policy change will produce to the NHS and
the police over and above economic and societal factors and the
policing initiatives that produced a 12% reduction in violent
injury last year.
CONCLUSION
26. In its responses to our previous questions
and those raised in the debate, the Home Office has simply reiterated
the research without showing any direct connection between the
"permitted pricing" proposal and the benefits claimed.
We do not question the research: page 8 of the IA suggests that
doubling the level of alcohol excise duty would reduce alcohol-related
mortality by an average of 35%, traffic crash deaths by 11%, sexually
transmitted disease by 6%, violence by 2% and crime by 1.4% [period
not specified]. Such results would be impressive but the "permitted
price" described in this instrument does not double the level
of alcohol excise duty, it only seeks to reinforce the current
level of excise duty. Furthermore, that excise duty has recently
been reduced in the Budget.
27. When the new Order is debated, and the House
will have another opportunity to press the Minister to explain
the specific benefits of the "permitted pricing" policy
and what direct effect it will have on reducing alcohol-related
crime and health harms over and above the established trends illustrated
by the Cardiff study. Since the revised Order does not provide
any additional explanation, we can only conclude, as before, that
the effect of the policy appears to be negligible and may imperfectly
achieve its policy objective.
1 The implications for access to justice of the Government's
proposals to reform legal aid JCHR 7th Report of Session 2013-14
(HL Paper 100). Back
2
See https://www.gov.uk/government/publications/the-implications-for-access-to-justice-of-the-governments-proposals-to-reform-legal-aid. Back
3
HL Deb, 25 March 2014, cols 508-18. Back
4
32nd Report of this session (HL Paper 137). Back
5
The outcome of the figures set out in the EM is a net annual cost
of £0.95 million. Back
6
35th Report of this session (HL Paper 149). Back
7
HL Deb, 25 March 2014, cols 508-18. Back
8
http://www.cardiff.ac.uk/news/articles/serious-violence-in-england-and-wales-drops-12-in-2013-12836.html?utm_source=cu-home&utm_medium=slide&utm_campaign=news Back
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