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House of Lords

Monday, 20 July 2015.

2.30 pm

Prayers—read by the Lord Bishop of Peterborough.

Oaths and Affirmations

2.35 pm

Lord Mountevans took the oath, following the by-election under Standing Order 9, and signed an undertaking to abide by the Code of Conduct.

Asylum: Sexual Orientation


2.36 pm

Asked by Lord Scriven

To ask Her Majesty’s Government whether they plan to implement the recommendations in the report by the Independent Chief Inspector of Borders and Immigration of March–June 2014 regarding the handling of asylum claims made on the grounds of sexual orientation, and if so, when.

The Minister of State, Home Office (Lord Bates) (Con): My Lords, the Home Office has been actively working to implement the recommendations. An updated asylum instruction considering sexual identity issues in the asylum claim has been issued. Approved training for staff is under development. These will ensure the sensitive and effective exploration of asylum claims based on sexuality. The Home Office is conducting “second pair of eyes” checks on all such claims to ensure the consistent recording of cases and more accurate data.

Lord Scriven (LD): I thank the Minister for that Answer. He may be aware that an action plan has been agreed with third sector organisations that has become more “plan” than “action”. Can he say when the action plan will be implemented and, if not, will he write to me giving a date? Also, could the person overseeing the action plan be someone equivalent to the director of asylum, rather than a junior policy officer, as is presently the case?

Lord Bates: I am aware of the action plan; it has been drawn up in consultation with the national asylum stakeholders group, which includes groups that work specifically with lesbian, gay and bisexual organisations. He will be aware of the report of the Independent Chief Inspector of Borders and Immigration: we have accepted all its recommendations and they are in the process of being implemented. I do not have a final date for when that will be concluded, but I shall certainly speak with officials about that and write to him.

Lord Lexden (Con): What action is being taken to combat the harassment and bullying of LGBT people in certain immigration centres, as documented by the All-Party Parliamentary Group on Refugees and other bodies?

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Lord Bates: A review is going on into the very serious accusations that were made. It has been part of the Stephen Shaw review, which will report shortly. We take those accusations very seriously, and new guidelines are being prepared to ensure that such things do not happen again.

Lord Rosser (Lab): Bearing in mind that the chief inspector made a number of critical observations in his report, including on training, inconsistency of approach, the recording of information and the stereotyping of applicants—as well as the very differing appeal rates for detained fast-track sexual orientation decisions compared with detained fast-track asylum claims as a whole—when is a further independent investigation going to be carried out to check whether the required improvements in dealing with claims made on the basis of sexual orientation have actually been made, as opposed to the Home Office saying that they have, and are actually being delivered?

Lord Bates: We have to be very careful that we do not have overlapping investigations. A serious piece of work was done following some very serious accusations by the Independent Chief Inspector of Borders and Immigration last year, and we have undertaken to implement all the recommendations. In addition, as I mentioned to the noble Lord, Lord Scriven, a further action plan is being discussed with non-governmental organisations. We should allow those to go forward and ensure that the independent chief inspector continues to do his job in monitoring how his recommendations are implemented.

Baroness Hamwee (LD): My Lords, it is good to hear that the action plan has been worked up in consultation with the organisations mentioned by my noble friend. Will they be involved in monitoring, and will the Home Office keep them in line not just for consultation on snapshot investigations and checks, but to ensure that the procedures and practices of the Home Office and of immigration officials are as we would all wish to see?

Lord Bates: That was indeed one of the recommendations. Recommendation 4,

“Ensures that all asylum claims recorded on the grounds of sexual orientation are accurately recorded as such”.

I expect that that recording and keeping of records will help us to identify where problems might exist in the system.

Lord Cashman (Lab): My Lords, first, I declare an interest as a founder of Stonewall. Will the Minister encourage the Government to work in conjunction with the UK Lesbian & Gay Immigration Group, the Human Dignity Trust, the Kaleidoscope Trust and Stonewall, so that we deal sensitively with people who apply for asylum at probably their most vulnerable time—when they enter this country—and that their sexual orientation in no way becomes a bar to their gaining entry or consideration for asylum status?

Lord Bates: The noble Lord is absolutely right, and of course, in addition to that not being a bar, the persecution of that particular social group is one of the reasons why they might be granted asylum under

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the Geneva Convention. The UK Lesbian & Gay Immigration Group is a member of the national asylum stakeholders group, to which we referred earlier, so I absolutely endorse what the noble Lord said.

Baroness Northover (LD): My Lords, can the Minister tell me whether DfID is still taking forward the protection and support of LGBT groups—a plan that was of course devised by my former colleague Lynne Featherstone, and if he does not have the answer, could he write to let us know?

Lord Bates: I pay tribute to the noble Baroness’s work in her role as a DfID Minister. We continue to work through the Foreign and Commonwealth Office and public diplomacy to try to ensure that discrimination of that nature is tackled at source. I will look into the projects she referred to, but perhaps we can compare notes to ensure that we are looking at the right ones. However, I will be happy to look into them and ensure that they continue to receive funding.

Lord Harris of Haringey (Lab): My Lords, I understand that the former chief inspector of borders had some issues with the flexibility he was allowed in the investigations he could conduct and the publishing of his reports, rather than waiting for the publication of his annual report. Have those issues been resolved for the new inspector of borders?

Lord Bates: That matter was looked into by the Public Accounts Committee, which made some observations on how those reports are laid. They are laid in accordance with the UK Borders Act 2007, so we feel that that is consistent. The only reason why there was a change in the way they were routed through the department was to ensure that the Home Secretary had an opportunity to look at them, as is consistent with other reports, and in line with national security and public safety.

Lord Ramsbotham (CB): My Lords, this is one of the issues raised by the charity, Medical Justice, in connection with the general handling of complaints about various immigration issues. Can the Minister say whether there is any concerted attempt to improve the handling of complaints on such issues?

Lord Bates: Yes, I can certainly say that. In fact, one of the recommendations in the chief inspector’s report was precisely that there should be a change to the training module that deals with how sensitively questions are asked of people making asylum applications on the grounds of sexuality. I am pleased to say that, as of this August, everyone in the asylum claims assessment directorate will have undergone that additional training.

Lisbon: Lapa Palace


2.44 pm

Asked by Baroness Rawlings

To ask Her Majesty’s Government what information they have on the whereabouts of the historic Portuguese tiles from the British Residence in Lisbon after its former premises were sold in 2003.

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The Earl of Courtown (Con): My Lords, the former British ambassador’s residence known as Lapa Palace, which was sold in 2008, contains fine examples of traditional Portuguese azulejos tiles. These were included in the sale and are still in place in the house.

Baroness Rawlings (Con): My Lords, I am most grateful to my noble friend the Minister for all the trouble he has taken to find these historic tiles and for his satisfactory Answer. These tiles are important. They are part of our heritage, having been installed for Her Majesty the Queen’s state visit in 1957 to commemorate the Anglo-Portuguese Treaty of 1373. This is the oldest active treaty in the world today. Will the Minister see whether the Foreign Office will ask the present owner’s permission for these very special tiles to be officially documented and, in the future, to be viewed on request?

The Earl of Courtown: My Lords, the tiles have been documented at pages 75 to 78 of Appendix B of The Residence of the British Ambassador at Lisbon by TA Bull, published by the British Historical Society of Portugal in 1995, plus there is a selection of photographs by former Ambassador Stephen Wall. I can tell my noble friend that in December 2014 the British ambassador visited the property and was able to view the tiles, which she found to be in good repair and condition.

Lord Howarth of Newport (Lab): My Lords, the Treasury, which has an institutional blind spot about the value of soft power and culture, has for decades been bullying the Foreign Office to get rid of its fine buildings around the world. Can we have an assurance that the Chancellor will not, in his obsessive and indiscriminate cheese-paring, flog off our embassy in Paris, the residence in Vienna and indeed the Government Art Collection?

The Earl of Courtown: My Lords, as the noble Lord is no doubt aware, there are 38 designated residences that require the permission of my right honourable friend the Foreign Secretary before they can possibly be sold. The Lapa Palace was the last one to be sold. Two others are under consideration—Geneva and Cape Town, the latter because it is occupied for only two months of the year and Geneva because it is not best positioned.

Lord Addington (LD): My Lords, will the noble Earl give us an assurance that in future when this type of event occurs, the Government will publish what has happened so that there is no confusion?

The Earl of Courtown: My Lords, our heads of mission must certify annually that all Government Art Collection artwork, as well as antiques and other art, are present, in good order and properly recorded on an internal database. I recommend to the noble Lord the Government Art Collection website, where he will be able to pinpoint exactly where all the works of art are.

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Lord Higgins (Con): My Lords, is my noble friend aware that civil servants appear to have a list of things to place on new Ministers’ desks as soon as they arrive, which reflects their own enthusiasm. Indeed, when I first arrived at the Treasury, I immediately got a proposal to sell off the French, American and Italian embassies, which I turned down.

Noble Lords: Hear, hear!

Lord Higgins: Am I to understand that the same thing is happening again?

The Earl of Courtown: I do not think so. My noble friend, with his great experience, informs the House of what happened a number of years ago. I assure him that, as I said earlier, any decisions or requests to sell any of these designated residences would have to go over the desk of my right honourable friend the Foreign Secretary.

Lord Wright of Richmond (CB): My Lords, is the Minister aware that during my time as head of the Diplomatic Service there was a proposal from the Treasury that we should sell the British ambassador’s residence in Tokyo? We were able to persuade the Treasury that this would not be a sensible idea, since it had been a gift from the former Emperor of Japan in exchange for a peppercorn rent.

The Earl of Courtown: As ever, the noble Lord, Lord Wright of Richmond, informs the House with his great knowledge.

Lord Stevenson of Balmacara (Lab): In the year in which we are celebrating our great victory at Waterloo, my attention has been drawn to the fact that we also have a responsibility to ensure that the extraordinary campaign waged by Lord Wellington in Portugal in the preceding years to that also should be celebrated. Yet when I visited Portugal only a couple of years ago I discovered that all the work that has been done there and all the activities in support of commemorating our great joint venture to defeat the French is actually being funded by the EU and small countries outside the normal range. I wonder whether Her Majesty’s Government might consider putting more money into celebrating these great victories.

The Earl of Courtown: Last week there was an event in the Royal Gallery in your Lordships’ House concerning the Waterloo victory and at which the present Duke of Wellington was present. However, I take note of what the noble Lord said.

Lord Lawson of Blaby (Con): My Lords, when I became Financial Secretary to the Treasury in 1979, this was one of my delegated responsibilities under Chancellor Geoffrey Howe, and I thought that it was absolutely ridiculous to waste all this time on all this nonsense. I am glad to say that I was successful in persuading the present Lord Howe that this system should be changed and we should just cut the Foreign Office budget and leave it to decide how it is going to meet it.

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The Earl of Courtown: A very interesting question, my Lords.

Lord Cormack (Con): Will my noble friend ensure that the Government are a little careful in taking that precedent? Would he not agree with me that a British embassy and its contents should represent the best of what is British?

The Earl of Courtown: The noble Lord is quite right. It is very important that these residences reflect the importance of the British ambassador in these various countries.

Student Loans


2.51 pm

Asked by Baroness Garden of Frognal

To ask Her Majesty’s Government what assessment they have made of the impact on the part-time higher education sector in England of extending loans to students with Equivalent or Lower Qualifications in certain subjects.

Baroness Evans of Bowes Park (Con): The UK is a world leader in science and innovation, having the most productive science base in the G7. To continue to support this investment we announced a relaxation of the student support rules for those taking a second degree in part-time engineering, technology and computer science courses. This comes into force in the 2015-16 academic year, so it is too early to assess the impact of the policy.

Baroness Garden of Frognal (LD): My Lords, while that is some good news, the UK’s current skills shortage can be met only if adults reskill and retrain to meet that shortage. On the advice of the CBI and in the interests of productivity, will the Government consider reviewing the whole policy introduced by Labour in 2008-09 and reinstating loans for ELQ students? If not, what other support are they offering in the other sectors?

Baroness Evans of Bowes Park: I agree with the noble Baroness that providing opportunities for adults to reskill is important. However, university alone is not the only route to do this or to help us meet the productivity challenges ahead. She will be aware, for instance, that apprenticeships are not just for young people. In fact, last year, more than half of higher apprentices were over the age of 25. This Government have ambitious plans to deliver more than 3 million apprenticeships, including at degree level, over this Parliament. Just last week, the Advanced Manufacturing Research Centre announced a pioneering new education route for successful apprentices to study advanced vocational university degrees as part of their training.

Lord Stevenson of Balmacara (Lab): My Lords, part-time students are more likely to come from groups underrepresented in higher education and therefore need to be supported. However, there were almost

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55,000 fewer part-time higher education students in the UK in 2013-14, and that has been a continuous reduction of more than 40% since part-time fees were allowed to rocket. Now, the Chancellor proposes to axe maintenance grants. What is the forecast for HE part-time students in 2015-16 and beyond?

Baroness Evans of Bowes Park: As I said to the noble Baroness, there is a range of ways in which students can engage in higher education, including the 43% increase in the number of higher and degree apprenticeships compared to 2013. In 2013, 12.3 million people held a higher education qualification compared to 2.6 million in 2006. Of course one of the key impacts on people deciding what they want to do is the fact that the economy is improving. Almost 2 million jobs have been created since 2010, so people have security in their job and therefore may be deciding not to study.

Baroness Bakewell (Lab): Will the Minister acknowledge that part-time study for a full degree, done by people who already have jobs, does not allow the flexibility that she suggests is available generally? The fall in the number of students doing part-time higher degree courses is critical because the future of education may well lie in the willingness of people to take further degrees, to further their careers, while they are holding a full-time job.

Baroness Evans of Bowes Park: As I said, we are keen to continue to support part-time students. The higher and degree apprenticeships are widening access to a broad range of professions, including the automotive, aerospace and digital industries, and to occupations as diverse as solicitors, dental technicians and accountants. These apprenticeships are helping people to develop the high-level technical skills that they need, but which are also needed for the UK economy.

Lord Winston (Lab): Can the Minister give us some idea how the Government decide what degree courses are selected for this kind of support? It seems that this is not an equal issue for many of the arts and humanities.

Baroness Evans of Bowes Park: As I have said, the Government have announced a relaxation for a number of professions. I am sure that they will continue to do so to ensure that that as many people, both the young and the more experienced, have access to education and further training if that is what they wish to undertake.

Lord Stoneham of Droxford (LD): My Lords, to be successful the Government’s productivity plan has to deal with skills shortages and the recent decline of part-time higher education. Do the Government have the ambition to link the shortages of skills identified by the Migration Advisory Committee with extending the exemption for loans for part-time higher education attendees?

Baroness Evans of Bowes Park:In some sectors there has been a relaxation of the rules, which has also been driven by some of the needs of the economy. We are very keen to ensure that as many people have

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access to higher education as possible. We will continue to look at this but, as I have said, we have seen a 43% increase in the number of higher and degree apprenticeships compared to 2013—and, crucially, we are now seeing a growing economy. Since 2010, 2.4 million private sector jobs have been created. What people really want is job security; that is what we are providing.

Lord Lucas (Con): My Lords—

Baroness Wall of New Barnet (Lab): My Lords—

The Lord Privy Seal (Baroness Stowell of Beeston) (Con): My Lords, we have not yet heard from the Conservative Benches.

Lord Lucas: My Lords, do the Government plan to take forward the recommendation in the House of Lords Digital Skills Committee report that we should involve the Tech Partnership in reviving and modernising IT qualifications, particularly for the benefit of adults who wish to change career?

Baroness Evans of Bowes Park: I am sure that the Government are considering the conclusions of that report. I am happy to follow up on that with the noble Lord.

Baroness Wall of New Barnet: My Lords, it is music to my ears and, I am sure, to those of the noble Baroness, Lady Garden of Frognal, who has obviously been very involved in apprenticeships, to hear the Minister say how important they are. How does the Minister feel about the progress that is not being made in attracting women to take some of the STEM subjects apprenticeships? Many of us have been working hard to achieve that.

Baroness Evans of Bowes Park: I entirely agree with the noble Baroness that it is critical that women have access to these jobs and, in fact, to whatever career they so desire. Another obviously important thing is making sure that our schools are providing high-quality education for all students of all backgrounds, male and female, so that they have every opportunity they can in life to do what they so desire.

The Earl of Listowel (CB): My Lords, from the Cross Benches, is the Minister aware of the importance of offering basic numeracy and literacy courses to parents who may never have done very well at school? That is for their own opportunities in employment but also because of the huge advantage to children if their parents start learning, as highlighted by the National Institute of Adult Continuing Education’s report, chaired by my noble friend Lady Howarth of Breckland.

Baroness Evans of Bowes Park: The noble Earl makes a very good point. In fact, under the previous Government the number of students from disadvantaged backgrounds starting at university rose to its highest level ever. This Government want to double the rate of disadvantaged young people entering university by 2020 but in order to access university, young people have to have a high-quality schooling education. That is

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why we are delighted that more than 1 million more students are being taught in good and outstanding schools now than in 2010.

Death Penalty: Worldwide Abolition


3 pm

Asked by Lord Faulkner of Worcester

To ask Her Majesty’s Government what progress they have made in securing the worldwide abolition of the death penalty.

The Earl of Courtown (Con): My Lords, during the last Parliament, the Government worked with partners, notably the Swiss Government and experts such as the Death Penalty Project and the all-party parliamentary group, to promote global abolition. This policy was successful. In 2014, only 22 countries executed, while 140 were abolitionists. We will continue to raise death penalty cases abroad. The Diplomatic Service will make the practical and moral cases against the death penalty to retentionist countries.

Lord Faulkner of Worcester (Lab): My Lords, the Government’s continued commitment to the abolition of the death penalty is very welcome, but the Minister will be aware that some countries pose particular problems. Perhaps I may ask particularly about Iran, much in the news lately because of the welcome news about the signing of the deal on its nuclear programme. Is he aware that, according to Amnesty International, around 743 people were executed in Iran last year, most in secret, including juvenile offenders, drug offenders and political activists? That is probably more per head of the population than in any other country in the world. Can he give an assurance that, as UK-Iranian relations develop, Foreign Office officials will take every opportunity to demand improvements in Iran’s human rights record and that the barbarous use of the death penalty on such a grotesque scale comes to an end?

The Earl of Courtown: The noble Lord, Lord Faulkner, mentions quite horrific figures from Iran. He is right about pressure. I hope that the agreement reached only last week will open the door to more work that we can carry out. The recent diplomatic breakthrough may enable more dialogue, and our diplomatic staff will take advantage of any opening possible.

Baroness Stern (CB): My Lords, I declare an interest as co-chair of the All-Party Parliamentary Group for the Abolition of the Death Penalty and express appreciation for the principled stance that the Government have taken on this matter. The Minister will be aware of Lindsay Sandiford, the British grandmother, who is on death row in Indonesia for drug trafficking. What are the Government doing to ensure that vulnerable British nationals under sentence of death like Lindsay Sandiford have effective legal representation?

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The Earl of Courtown: My Lords, the noble Baroness mentions a particular case in Indonesia and legal representation. It has been the policy of all Governments in the past not to fund legal costs for those in this position, but we will work as hard as we can both bilaterally and multilaterally to protect individuals who end up in this situation.

Lord Avebury (LD): My Lords, the coalition Government produced the Strategy for Abolition of the Death Penalty 2010-2015, but that does not appear to have been succeeded by another strategy covering the years 2015 to 2020. Will that happen? Perhaps I may also ask the Minister about the case of Saudi Arabia. The Foreign Office website points out that 100 executions have taken place there so far this year and that we raise the matter on every possible occasion, bilaterally and through the European Union. When we do that, can we concentrate on the safeguards developed by the United Nations that are recommended for use in death penalty cases, in particular those regarding the ingredients of a fair trial?

The Earl of Courtown: My Lords, the noble Lord mentioned Saudi Arabia. We frequently raise the issue of the death penalty with the Saudi authorities both bilaterally at the highest levels and through the European Union. The noble Lord also mentioned the 2010 to 2015 plan. I can tell him that we are still funding projects through the Human Rights and Democracy fund in the US, China and south-east Asia, the Middle East and north Africa. We provide training for defence lawyers in the United States and we have supported a regional organisation in the greater Caribbean area, as well as providing support for defence lawyers in the Caribbean. We also fund important work to support abolitionists. These works are ongoing.

Lord Dubs (Lab): My Lords, is the Minister aware that we in the All-Party Parliamentary Group for the Abolition of the Death Penalty are grateful for the support we get for visits we pay to overseas countries? The United States has always been a particular difficulty. Is the Minister aware that as recently as 29 June, two judges in the Supreme Court said in a dissenting judgment that they were asking for a full briefing on a basic question of whether the death penalty violates the constitution? Although it was not a majority view, it was pretty well a landmark conclusion. Does the Minister agree that the time has come to push the United States a bit further?

The Earl of Courtown: I think that the noble Lord, Lord Dubs, is correct. The situation in America is difficult to believe, but there has been progress. Nebraska has abolished the death penalty, while Oregon and Washington State have entered a moratorium. Since 2010 we have banned drugs being exported to the United States, which was followed by the whole of the EU in 2012.

Baroness Smith of Basildon (Lab): Further to what has been said about the USA, perhaps I may raise with the noble Earl a specific issue which I would ask him to raise with the US authorities and perhaps also with our EU partners. Thomas Knight was executed in

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Florida on 7 January 2014 for a murder he committed at the age of 23. However, he had been on death row for 39 years. There are numerous incidents of young men being held on death row for years and years when presumably they are quite different people by the time they are executed. I ask the noble Earl to raise this very serious issue to ensure that we do not have people on death row for such inordinate lengths of time, waiting for their execution.

The Earl of Courtown: I thank the noble Baroness for bringing that to my attention. Spending that length of time on death row is quite inhuman. I will of course raise it with officials in the department.

Palace of Westminster Committee

Membership Motion

3.07 pm

Moved by The Chairman of Committees

That the Commons message of 16 July be considered and that a Committee of six Lords be appointed to join with the Committee appointed by the Commons to consider the restoration and renewal of the Palace of Westminster;

That the following members be appointed to the Committee:

Lord Carter of Coles, Lord Deighton, Lord Laming, Baroness Smith of Basildon, Baroness Stowell of Beeston, Lord Wallace of Tankerness;

That the Committee have power to agree with the Committee appointed by the Commons in the appointment of a Chairman;

That the Committee have power to send for persons, papers and records;

That the Committee have power to appoint specialist advisers;

That the Committee have leave to report from time to time;

That the Committee have power to adjourn from place to place;

That the reports of the Committee from time to time shall be printed, regardless of any adjournment of the House; and

That the evidence taken by the Committee shall, if the Committee so wishes, be published.

Lord Richard (Lab): My Lords, I am not sure whether it is in order for me to ask the Chairman of Committees this question, but why is he not in the delegation of six? I raised this matter last week on the basis that this House needs the same quality of representation as the House of Commons. As I understand it, the man who has the equivalent duties to those of the Chairman of Committees in relation to the fabric of the House in the House of Commons is going to be on the committee, while the noble Lord the Chairman of Committees is not. That seems to be a little odd, and I would be grateful for some explanation as to why this was decided upon.

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Lord Foulkes of Cumnock (Lab): My Lords, I endorse what my noble friend has just said. A number of people raised this issue in the short debate we had last week, to which the Leader of the House replied. A number of people also raised the matter of equivalence of membership between the Commons and the Lords. My quite clear recollection is that the Leader of the House said that there would be two joint chairmen, but this Motion provides for the appointment of “a chairman”. We cannot have two joint chairmen, one from the Commons and one from the Lords, which is the ideal we wanted, if there is to be the appointment of a chairman. I hope that the Chairman of Committees will clarify that and give us an assurance that there will be a joint chairperson from the Commons and the Lords.

The Chairman of Committees (Lord Sewel): My Lords, I should say first that I think we are fortunate that the two Back-Bench Members of the Joint Committee from this House will bring to its deliberations a very deep level of expertise and experience of the issues. I do not think that we could have selected two stronger candidates.

On the particular issues that the noble Lords raised, the basis of selection for the Joint Committee is party allocation. I understand that the usual channels in both Houses decided a party allocation to represent the relative strength and standing of the parties in the two Houses. Of course, in this House the three officeholders—the Lord Speaker, the Chairman of Committees and the Deputy Chairman of Committees—put aside all party affiliations during their terms of office, so clearly could not be considered in a scheme based on party allocations. I also point out that the individual who does my equivalent job in the House of Commons has not been nominated as a member of the Joint Committee.

Lord Foulkes of Cumnock: The Leader—sorry, he is the Chairman of Committees. He would be better as Leader of the House, but that is another story. Will the Chairman of Committees clarify the position of the joint chairman? It was made absolutely clear by the Leader of the House in our debate last week that there would be equal chairs from both Houses.

The Chairman of Committees: I am sorry that I forgot the question asked by the noble Lord, Lord Foulkes—a sin of omission indeed. My understanding is that the committee will operate on the basis of Mr Grayling in the Commons chairing one session and the Leader of this House chairing the alternate session. I understand that that is how they will proceed.

Lord Richard: Before the noble Lord concludes, for the purpose of clarity can I ensure that, as the representation from this House is six, the representation from the House of Commons is also six, and not more?

The Chairman of Committees: I can give that confirmation: it is six each.

Motion agreed.

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Supply and Appropriation (Main Estimates) Bill

Second Reading (and remaining stages)

3.11 pm

Bill read a second time. Committee negatived. Standing Order 46 having been dispensed with, the Bill was read a third time, and passed.

Psychoactive Substances Bill [HL]

Third Reading

3.12 pm

Clause 58: Interpretation

Amendment 1

Moved by Lord Bates

1: Clause 58, page 35, line 14, at end insert—

““access prohibition” has the meaning given by section 21(b);”

The Minister of State, Home Office (Lord Bates) (Con): My Lords, Amendment 1 simply adds a definition of an “access prohibition” to the interpretation clause.

I take this opportunity to thank all noble Lords who have participated in the debates on the Bill over the last couple of months. I am particularly grateful for the support that I have received from my noble friend Lady Chisholm. I am pleased that we have been able to make common cause with the Opposition Front Bench and I am grateful to the noble Lords, Lords Rosser and Lord Tunnicliffe, for their support. I will not hold against them the little matter of the Government’s defeat last Tuesday, which was a hawkish move to strengthen the Bill as it relates to prisoners. I know that they share the Government’s objective of seeking to make the provisions of the Bill as effective as possible in tackling the trade in psychoactive substances, whether in prisons or elsewhere. We will, of course, reflect over the Summer Recess on the amendments to Clause 6.

3.15 pm

I am also grateful for the valued contributions to our debates from the noble Lords, Lord Paddick and Lord Howarth, and from the noble Baronesses, Lady Hamwee and Lady Meacher. We clearly take a different view on drugs policy, but I am pleased that we have been able to find common ground and I recognise their genuine desire, which they share with the Government, to reduce the harms caused by these unregulated substances.

We are committed to bringing forward further amendments to the Bill in the House of Commons, in particular to the list of exempted substances in Schedule 1, so this House will have a further opportunity to return to these issues later in the year. As I indicated on Report, we will also give very careful consideration, following further discussions over the Recess with the Advisory Council on the Misuse of Drugs, to

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strengthening the definition of a psychoactive substance. However, these are matters for another day. For now, I beg to move Amendment 1.

Amendment 1 agreed.

3.15 pm


Moved by Lord Bates

That the Bill do now pass.

Lord Bates: My Lords, I beg to move.

Lord Rosser (Lab): I take this opportunity to thank the Minister for his courtesy and thoroughness in responding to points raised and amendments tabled by noble Lords during our considerations of the Bill, including when the response has been made subsequently in writing. Although reservations about the likely effectiveness of the Bill have been expressed by some noble Lords during our deliberations, I am sure we all hope that, when the Bill is finally passed, it will make a favourable impact on the very real problem that it is intended to help address.

Lord Paddick (LD): My Lords, I, too, thank the Minister for the way that he has conducted proceedings on the Bill. We have had disagreements over how effective we think that this legislation will be, but, as the Minister said, we share the aim of reducing harm. We hope that, with the assistance of the Advisory Council on the Misuse of Drugs, the Bill will be further improved in the other place so that the harmful effects that could possibly arise from it are at least lessened.

Bill passed and sent to the Commons.

Charities (Protection and Social Investment) Bill [HL]


3.17 pm

Clause 3: Range of conduct to be considered when exercising powers

Amendment 1

Moved by Lord Bridges of Headley

1: Clause 3, page 2, line 42, leave out “or privy to”

The Parliamentary Secretary, Cabinet Office (Lord Bridges of Headley) (Con): My Lords, before I address this amendment, I thank all those who have debated, scrutinised and kicked the tyres, so to speak, of this Bill, not just in Committee but also during its pre-legislative scrutiny. Although I know there may be points on which some of us may differ, the Bill before your Lordships today has greatly benefited from the wisdom, experience and insight that a number of your Lordships, sitting on all Benches, have brought to the debate. The fact that we have managed to agree on so much reflects

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the overwhelming wish of this House to ensure that charities continue to have the trust and confidence of the general public.

This group of amendments is focused on providing greater clarity in the Bill, and more modern language. The noble and Learned Lord, Lord Hope of Craighead, who has been involved in this Bill since its publication in draft last year, raised these points in Committee.

These amendments address the old-fashioned language of “privy to”, replacing it with a much clearer form of words while maintaining the threshold for intervention at the same level. Being “privy to” something can comprise more than mere knowledge, and includes an element of concurrence, or agreement, as well. We believe that the new formulation captures that.

There are two elements to the new wording: first, that the person,

“knew of the misconduct or mismanagement”;

and, secondly, that they,

“failed to take any reasonable step to oppose it”.

We believe that, together, both elements equate as closely as possible to “privy to” but are much clearer for the lay reader of the legislation. The amendments replace “privy to” throughout the Bill and the Charities Act 2011, except in one place in the Charities Act 2011, in Section 71. Here the context is quite different and privity does not appear to refer to anything more than just knowledge.

I apologise for the late tabling of Amendments 13A, 13B and 13C. I confess that there was an oversight on our part but we decided to table them late because without them we would have left “privy to” in one part of the Bill while addressing it in all others.

These amendments, while relatively minor changes, will improve the clarity of the Bill and make the law more understandable for the lay reader. I beg to move.

Lord Hope of Craighead (CB): I am very grateful to the Minister and those who have been advising him for this group of amendments. As the Minister pointed out, it achieves much greater clarity than the rather old-fashioned word “privy”—being used as an adjective—did. It has been replaced by two very important verbs. The value of the clarity is that there are two sides to each of these clauses that one has to consider: the person who is being suspected of having engaged in the prohibited activity; and the commission itself, which has to police the activities of the person. Clarity is needed on both sides and the way in which the clauses have been reworded achieves that.

I congratulate the Minister on finding a better form of words than I think I was able to do—or indeed the Joint Committee was able to do when it was looking at the matter. The formula is much improved. I think I must bear some responsibility for not having searched through the whole Bill and traced all the various places in which “privy” was being used. I think we have now reached finality on that issue and for that, too, I am extremely grateful.

Amendment 1 agreed.

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Amendment 2

Moved by Lord Bridges of Headley

2: Clause 3, page 2, line 43, after “mismanagement,” insert—

“( ) that a particular person knew of the misconduct or mismanagement and failed to take any reasonable step to oppose it,”

Amendment 2 agreed.

Clause 4: Power to remove trustees etc following an inquiry

Amendments 3 and 4

Moved by Lord Bridges of Headley

3: Clause 4, page 3, line 31, leave out “or privy to”

4: Clause 4, page 3, line 32, after “mismanagement,” insert—

“( ) who knew of the misconduct or mismanagement and failed to take any reasonable step to oppose it,”

Amendments 3 and 4 agreed.

Clause 8: Power to direct property to be applied to another charity

Amendment 5

Moved by Lord Bridges of Headley

5: Clause 8, page 6, line 41, leave out “In”

Lord Bridges of Headley: My Lords, this second group of amendments also responds to a point raised by the noble and learned Lord, Lord Hope of Craighead, and I am grateful to him for bringing this to our attention as well.

Amendments 5 and 6 relate to Clause 8, which amends the Charity Commission’s power in Section 85 of the Charities Act 2011 to direct the application of charity property where the person holding it is unwilling to apply the property. The purpose of Clause 8 is to enable the commission to make an effective direction in cases where the person holding the charity property may be willing but is unable to apply it. The most common example of this problem was considered to be where financial institutions hold a charity’s property but are unable to comply with a commission direction to transfer that property because to do so would result in a breach of their contract with the charity.

I am conscious that we have gone back and forth on this issue. Our initial drafting sought to remove any obstacles by allowing the commission’s direction to overcome a contractual obligation owed to the charity. Importantly, Clause 8 continues to provide the specific statutory protection for a financial institution in cases where compliance with a Charity Commission direction in these circumstances might constitute a breach of its contract with a charity.

However, we have been made aware that there are other barriers that may make a person unable to comply with a commission direction of this type; for example, a person may be willing in principle to apply a property properly but lack the power to do so. Therefore, our new formulation in Amendment 6 clearly

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amends Clause 8 to reintroduce “unable” so that it is clear that the commission’s power to direct the application of charity property can be exercised where the person holding the property is either unwilling or unable to transfer it.

Again, this is a relatively modest amendment but it will, I believe, improve the effectiveness and practicality of this provision. I beg to move.

Lord Hope of Craighead: My Lords, here again I express my gratitude to the Minister for bringing this amendment forward. He has explained very precisely the value which can be seen in the introduction of the additional word. I know from communications with the Charity Commission that it is delighted that this amendment is being made. As I endeavoured to explain in Committee, the wording in the Bill when it was introduced left it with a problem, which has now been solved. On behalf of the commission, I am extremely grateful.

Baroness Hayter of Kentish Town (Lab): I offer the same thanks to the Minister for having listened to the arguments and for moving this amendment, which we are happy to agree to.

Amendment 5 agreed.

Amendment 6

Moved by Lord Bridges of Headley

6: Clause 8, page 6, line 42, after “unwilling)” insert “is amended as follows.

(00)”) In subsection (1)(a), after “unwilling” insert “or unable”.

(00)”) ”

Amendment 6 agreed.

Amendment 7

Moved by Baroness Hayter of Kentish Town

7: After Clause 8, insert the following new Clause—

“Conduct of charities: disposal of assets

The Charity Commission shall ensure that independent charities are not compelled to use or dispose of their assets in a way which is inconsistent with their charitable purposes.”

Baroness Hayter of Kentish Town: My Lords, Amendment 7 stands in my name and those of the right reverend the Prelate Bishop of Rochester and the noble Lords, Lord Kerslake and Lord Palmer of Childs Hill. The amendment is about the rights and the duties of independent charities which hold in trust various assets for their beneficiaries, both today and in perpetuity. Charitable law, which dates from Elizabethan times, developed to preserve and protect such assets, which are normally bequeathed or gifted for very specific charitable purposes. There are therefore rules covering the disposal of assets and the role and responsibilities of trustees, all with the same aim—to ensure that a charity’s resources are spent only on the purposes laid down in its trust deed and in compliance with fiduciary and charitable law. Amendment 7 essentially restates the existing legal position and aims to give comfort to charity trustees that they cannot, without a change in

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the law, be compelled to sell assets where it is contrary to their charitable purpose.

We are not against the right to buy. Indeed, it was only because of the then GLC, which gave 100% mortgages to single women, and on converted premises, that I was able to move from renting to buying. I have had a letter from the CLG Minister, the noble Baroness, Lady Williams, saying that her party supported home ownership, implying that my party does not, but I take no lessons from any other party on this. Right to buy has helped many, but so did MIRAS, better regulation of mortgages, the end of the pernicious mis-selling of endowment mortgages and the setting up of the estate agent ombudsmen—all of which took place, of course, under a Labour Government. Many other interventions help people get into the housing market, but we do not want the right to buy to be at the expense of the charitable aims of those charities which, for example, have been donated land, money or property for a specific purpose, whether it is to help house the elderly or rural workers or to rent to low-income families or other particular categories of beneficiary.

The National Housing Federation worries that forcing trustees to sell property, even if they are fully compensated financially, sets a dangerous precedent for government intervention in independent charities. It does not support giving government a role which should be the preserve of housing associations’ own charitable trustees. Similarly, the NCVO says:

“It would also contradict the rule according to which charities cannot dispose of assets … other than in pursuit of charitable objectives”—

that is, the use of such assets,

“for charitable, rather than political or private benefit”.

There are other charitable concerns about the policy, such as whether any bequests could be invalidated in the circumstance of a forced sale. There are particular worries where a charity holds designated land that is required by the terms of a gift to be used to carry out the charity’s purposes and where such land cannot be replaced by other appropriate property or land. That could be the case where a charity holds a house once owned by a particular local figure or associated with a former convent or an almshouse sponsor.

3.30 pm

Charities must also consider who else would be affected by the disposal, such as if the home forms part of a supported community for the elderly, the infirm or those with learning difficulties, where the whole is much more than a collection of residences. The sale of one or more of those units, where those not from that background move in, would have a considerable impact on the viability of the community and its shared values and resources. All that affects charities law, which is why this debate must take place on this Bill and not simply when the housing Bill finally comes to Parliament.

In terms of this Bill, the concern is that the Government want to interfere with the duties of charitable trustees to put their beneficiaries first and comply with their own trust deed. Many housing associations might sometimes welcome right to buy for their tenants where that accords with their charitable objectives. We support that. The problem, of course, is where it

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conflicts. The amendment seeks to prevent a charity being compelled to do something that is not in its best interest. In the letter of 16 July written to me by the noble Baroness, Lady Williams of Trafford, she admitted that what the Government propose would be a “substantial change”. She acknowledged that housing association charities have some apprehension about being compelled to dispose of their assets and how that fits with charities law. Quite so—that is why this Bill is the place to debate this issue.

Our amendment is about charities, many of whose tenants live in homes built with private charitable money. They are different from local authority tenants or tenants whose homes were built with some public money after 1974. Amendment 7 confirms the existing position that assets belonging to a charity must be used for that charity’s purpose. Sometimes, indeed, that will be by sale to raise money or replace stock. The amendment simply says that it is for the trustees of these independent organisations to decide that—not some outside body. I beg to move.

Lord Kerslake (CB): My Lords, I declare my interests as chair of Peabody and president of the Local Government Association. I speak in favour of this amendment in light of the Government’s stated intention to extend the right-to-buy policy to housing associations. I entirely support the Government’s aim to extend home ownership but have serious concerns about this proposed way of doing so.

Currently, tenants in housing association properties—unless their property was transferred from a local authority and therefore covered by a preserved right to buy—are able to purchase their properties only through right to acquire. That is limited to properties built or bought after 31 March 1997 and—this is crucial—funded through social housing grant. Under the Government’s current proposals to extend right to buy, all properties would be open to purchase and the available discount of up to £104,000 on a flat after three years’ occupation would be much greater. That would include significant numbers of properties built with absolutely no contribution from government.

Peabody was established 153 years ago by an enlightened, London-based but American-born banker, George Peabody. The aim of the Peabody Donation Fund that he launched in 1862 was to,

“ameliorate the condition of the poor and needy of this great metropolis, and to promote their comfort and happiness”.

His contribution was £500,000, equivalent to nearly £1 billion at today’s prices. By 1882, 3,500 properties had been constructed, including the Whitechapel estate in east London and the Wild Street estate in Covent Garden. By 1939, there were 8,000 properties. Today, Peabody is established by statute and has 28,000 properties, but its mission has remained essentially the same. In all of its 153 years, it has received public funding for only 40.

Given that the average value of a Peabody property is over £350,000, it is likely that, even with the discount, sales will be to the better-off residents. Experience from local authority sales though right to buy is that, over time, substantial numbers of the properties are sold off, so that one-third of the homes become buy-to-let

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properties at market rents. These can be as much as double social rents, and so not accessible to low-income families, as was originally intended. The Government’s intention is, rightly, to see one-for-one replacement but, again, local authority experience is that this is unlikely to be achieved, and certainly not at the pace of the sales or in the locations where the sales have occurred.

I have spoken extensively of Peabody, but since I first raised this issue I have been inundated by many people and organisations of all shapes and sizes with very similar concerns. For example, the Holt and Neighbourhood Housing Society was brought to my attention by Norfolk county councillor, Dr Marie Strong. This is what the chairman of that society has to say:

“The Society was funded in 1960 with land and finance by a local family because of concern for affordable local housing. Now, with the generosity of local people, the Society has 35 properties in Holt, Glandford and Letheringsett, managed by a committee of local volunteers. The aim is to provide affordable housing for local people in housing need. Not bound by local authority rules the properties are always allocated to local people which helps ensure a continuity of the community. The rents are around one-half to two-thirds market rent. The government proposal would be a gross violation of what was intended—that the properties would be let in perpetuity to local people”.

If the policy is pursued in its current form, it will be contrary to the charitable intent of Peabody and housing associations like it. It would also—this is the critical point—be a major disincentive to charitable benefactors such as George Peabody and the local family in Norfolk that I referred to, to donate their money or their land for good causes, if the Government can intervene and direct the sale of those assets for very different purposes.

One wonders what George Peabody would have made of this. In 1866, he said that his donation would,

“act more powerfully in future generations than in the present; it is intended to endure forever”.

Far from enduring for ever, the sequestration of property built with private philanthropic money would seriously undermine the charitable foundations and ongoing objectives of Peabody and other charitable housing associations like it. The amendment would protect charities from this, both now and in future.

Lord Palmer of Childs Hill (LD): My Lords, being on Report and bearing in mind all the comments made by the noble Baroness, Lady Hayter, and the noble Lord, Lord Kerslake, I can keep my remarks to the minimum, although I agree with all that they have said—and I certainly support the amendment. My brief point is that we should put ourselves in the place of the charity itself, which in this case may be a housing association that is told by the Government that it has to sell off its properties at a discount, as the noble Lord, Lord Kerslake, said, of up to £104,000 per property. That housing association has an ongoing business and ongoing logic of providing housing—not just the houses that it has already, such as in Peabody, but the houses that it might build for the future.

Let us put ourselves in the place of chief executives of housing associations asking their banks for finance to build more properties as registered social landlords. Any bank manager would look at them and say, “I would lend you the money, but how can you deal with

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the fact that the Government are going to take a proportion of those properties away by forcing you to sell them at a massive discount?”. No bank manager would lend. Therefore, if the Bill is not amended, it will take away not only housing associations’ assets but their ability to borrow and build more housing for people in need. Therefore, I heartily support this amendment and hope that when we get the housing Bill we will be able to go into this in great detail.

When I asked the noble Baroness, Lady Williams, how housing associations are going to build like for like when there are discounts of up to £104,000 she replied in this Chamber and in a letter that it is government policy. It is a government policy without any arithmetic. If that is the way the Government are going, they are headed for disaster.

Lord Cormack (Con): I hesitate to rise on this occasion because I have a great deal of sympathy with what has been said so far. I was concerned when the pledge to sequester the assets of charities was made during the election, and I believe that it is very difficult to justify. However, this is not really the time or the place to debate that. Whether we like it or not—and as I made plain, I do not particularly like it—it was a government pledge. The Government have every right to introduce a Bill, just as we have every right to seek to amend that Bill, and if it is defeated in another place, I am not going to be heartbroken.

However, for us in this Bill to anticipate a crucial part of another Bill which has not yet come before us is not the right parliamentary approach. Colleagues in all parts of the House should signify their concerns and misgivings, just as the noble Lord, Lord Kerslake, did in a notable maiden speech on the Queen’s Speech, and that is fine. It is good that colleagues should voice their concerns. We in this House have a reputation of which we are all proud and which I trust we will always deserve. It is for looking in minute detail at Bills that come before us to seek to amend them, for asking another place to think again and even for asking another place to think yet again.

This Bill, which in broad general terms has the support of colleagues in all parts of this House, is not the way to approach the crucial social issue which colleagues have touched upon this afternoon. I hope that, the subject having been aired, this amendment will be withdrawn. When we come to the housing Bill, that is the opportunity for all of us who have misgivings, if those misgivings are still justified, because we have not seen the final form of that Bill. It may be, and I very much hope it will be, that the Government will have taken on board many of the points that have been made in your Lordships’ House this afternoon and on other occasions. Now is not the time, now is not the place, this is not the Bill to tackle this extremely important social issue, and I hope that we do not proceed to a Division this afternoon.

3.45 pm

Lord Campbell-Savours (Lab): My Lords, the noble Lord, Lord Cormack, would have a case but for the fact that the Government are relying on charitable organisations to deal with the housing crisis. We are dealing here with the nub of the issue: the charitable

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status of organisations that are responsible—or, in many cases, have been given that responsibility—for building homes to house people in areas of stress.

I have spoken twice on this matter in the past month. On the first occasion I read to the House a letter from a Mr Bill Bewley in Keswick, the chairman of Keswick Community Housing Trust, expressing anger and concern on behalf of the trust in Keswick, which comprises an ecumenical gathering of people, including Catholics, Protestants, Quakers, Kings Church, Methodists and others, who all voluntarily, without remuneration, give their time to build houses in Keswick through a local charitable organisation, all motivated by the single objective of helping those in need in the Keswick area. What troubles them is that, having worked in this climate of charity for so long and made that effort, they are now being engaged to build even more in the town, with another project to come on stream in the next year or two, but they will find that they are obliged by law effectively to sell their properties at a subsidised rate.

That brings me to an accompanying issue, which is what happened in the Budget. We were told in the Budget that housing associations are going to be required over the next five years to reduce rents by 1% per annum. If you take into account that requirement, which I understand might apply to the charitable organisations that I am referring to, in conjunction with the provisions that we are talking about today, you can see why we are driving these organisations, comprising people whose only wish is to serve the public, into a position where they have to relinquish their property. That is why I hope that the Minister, who has been given much notice of this issue during the course of previous debates in Committee, will come to the Dispatch Box today and put all our minds at rest.

Lord Hope of Craighead: My Lords, I absolutely understand the force of the points that have been made by the noble Lord opposite, and particularly the impressive speech from the noble Lord, Lord Kerslake, but I wonder whether the mechanism that this amendment seeks to use to solve the social problems that have been talked about is the right one. It would put a duty on the Charity Commission and expresses that duty in the widest possible terms without qualifying the charities being talked about, the nature of the compulsion that they face or what the assets are that are sought to be disposed of. It is not a targeted amendment in the sense of dealing specifically with the point about the right to buy and interference with the assets of charities in the social housing field; it is entirely general.

I have no remit for the Charity Commission, and I am not advocating anything on its behalf on instructions, but one advantage of the procedure that was used before the Bill was introduced into this House was the pre-legislative scrutiny through the Joint Committee. This issue was not raised in the course of the Joint Committee’s proceedings. That is a pity because among those who gave evidence were representatives of the Charity Commission itself, who had an opportunity to comment on the various amendments to the Bill that are being proposed and to suggest improvements, as indeed we are discussing first thing at this stage.

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I do not know what the commission’s position is on this clause but I suspect that it would be extremely concerned about being faced with a duty in these very broad terms and its ability, given the resources that it has to deploy right across the charitable sector, to do what the amendment requires. So, without commenting on the underlying substance, I respectfully suggest that this is not the right mechanism, and that the wording of this amendment is certainly far too wide to address the particular problem that has been discussed so far.

Lord Mackay of Clashfern (Con): My Lords, I will raise a question in relation to this amendment which has nothing to do, primarily, with the issue that has been raised, and which will come forward in another Bill. One of the problems for charities is that from time to time they are subject to compulsory acquisition. For example, if a charity owns property which is required for a road or something of that sort, the authority that has compulsory powers in relation to that will be able to acquire it. I am not clear that this amendment is consistent with that possibility, because the Charity Commissioners would find it impossible to block a compulsory acquisition if it was made within the terms of the particular statute which authorises the acquisition.

As your Lordships will know, there are many statutes which authorise compulsory acquisition. However, an important aspect of compulsory acquisition is that the acquiring authority has to pay the full value of what is required. I do not know what the Government’s proposals will be in relation to this other matter, but all I can say at the moment is that the amendment does not seem properly to recognise the possibility of charitable property being acquired by compulsory acquisition under one of the compulsory acquisition statutes. I would be glad if the noble Baroness would deal with that.

Lord Best (CB): My Lords, I will raise a somewhat technocratic reason why the amendment could be very important. If government compels charitable housing associations to sell their assets—even if they are reimbursed by the Government—and then tells them how to spend the money they receive from selling their assets, these charities may become classified by the Office for National Statistics as “public bodies”. If government takes away the autonomy of charities and assumes the role of their boards or trustees in crucial decision-making, a line may be crossed. Already, government heavily regulates the activities of charitable housing associations and determines their income by instructing them on the rents that they must charge. In the event that government also tells them when to dispose of their assets and at what price, and subsequently instructs them on how to use the money, intentionally or not, the charitable housing associations could be deemed by the independent Office for National Statistics as public bodies.

Does that matter? I am afraid that it matters a lot. At present, only the grants these bodies receive from government count as public expenditure, so their borrowing from banks, building societies, et cetera, adds nothing to government debt. All that changes if housing associations are classified as public bodies.

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The £60 billion they have already borrowed would be added to the national debt and all their new borrowing—around £4 billion this year—would be added to the Government’s annual deficit. So if compelling housing associations to sell their homes—and compelling them to use the proceeds, perhaps to replace the ones they have sold—leads to these bodies being classified as public bodies, government finances will take a huge hit. Government would then feel obliged to curtail drastically further borrowing by housing associations, which would stop them delivering the affordable homes that the nation so clearly needs. There are other reasons for not pursuing the latest right to buy sales policy, but this may be the one that causes the Treasury the greatest concern. This amendment would prevent government making a mistake that it could later regret deeply.

Baroness Barker (LD): My Lords, at the moment I am training for a charity event and I spend quite a lot of time, mostly at weekends, cycling rounds the parks of south London and north Surrey. The existence of alms houses and charitable housing associations is a timely reminder of the importance that the charitable sector has always had in this field and of the extent to which the charitable housing sector has always been an irritant to government, both locally and nationally. There is something marvellous about preserving its values in concrete.

We should remind ourselves that this is the protection of charities Bill. It is principally concerned with the extent to which the Charity Commission has the power to act against charities and individual trustees to ensure that the general public continue to have faith and confidence in charities. The amendment moved by the noble Baroness, Lady Hayter, may not be perfect for her intent, but the way that I read it is that she is seeking to get from the amendment and the discussion of it an undertaking that, should the Charity Commission be called upon to judge the performance of a charity or its trustees under the policy that is being brought in—as the noble Lord, Lord Cormack, explained, it still being formulated—the test which the commission will apply is: did the trustees act in alignment with the charity’s objectives? Of course, those objectives may not change in ways that are consistent with government policy. That is simply what the noble Baroness is trying to get on the record. For that reason, although the wording may not be perfect, the intent behind the amendment is worthy of our support.

Lord Graham of Edmonton (Lab): My Lords, the Government’s housing policy is in a mess, and I speak of the problems being faced by a number of good people who have so far done well from legislation. The right to buy was approved by everyone who was interested in wanting to give people an opportunity to get their foot on the property ladder. However, I remind the House of what has happened. The right to buy carries with it the right to sell. Over the last 30 years those who have bought their houses at a discount, having justified and verified their entitlement to it, have been glad to have the opportunity not only to buy but to sell. As a consequence, the whole policy has been warped and needs to be looked at in general. I shall give your Lordships an illustration.

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There is a couple who operate in the Ashford area. The Guardian newspaper last year reported that they have amassed not just one or two properties but, by purchasing in the main ex-council houses, a portfolio of 1,000 properties. That situation, with people looking for an opportunity to make money, existed when I was the Member of Parliament for Edmonton. The bought their house and then rented it out. I hope to speak in tomorrow’s debate on the Budget and extend this argument. People should not kid themselves that the main beneficiaries of the purchase of council houses have been the people who occupied them at the time. The people quoted in the newspaper said that they were thinking of selling their portfolio. They already had an estimate of its value: through their empire having grown and grown, it was estimated to be worth £100 million.

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The sad fact is that people paying exorbitant rents means that they may find themselves in a situation where they have difficulties. These people in Ashford say that, if the law allows them to seek an eviction, they will. The problem is that the money that this couple have been making out of their skill in managing property has caused a build-up of properties in that way. This may or may not be the right Bill in which to do it, but I hope that, when the dust dies down, a serious look will be taken at whether it is possible to curtail the building up of an empire built, in the main, on ex-council houses.

It is all very well for the person who sells the house at the time and the person who buys the house at the time, but nonsense situations, such as the one that I have outlined, mean that there is a good opportunity for the Minister and his colleagues to think again about what is happening. If they do not think again, they will allow empires to be built based, in the main, on the input of council and national money. These properties, originally as council houses, were wholly financed by the public sector. Now, that situation has changed.

I very much hope, without making a point, that the Minister has sufficient sense to realise that this is something that he ought to say kind words about in order to put a stop to this. If he does not, I think that he is in for trouble.

Baroness Gardner of Parkes (Con): I find this very disturbing, in that I strongly oppose the sale of housing association homes. So many valid points have been put forward, but I am concerned about the points made that various other aspects in this amendment might not be quite right. I intend to support the amendment today, which is very unlike me because I am normally a very loyal Member of this side of the House. However, I accept the point that individuals have given their money. For us to take it over from them in order to hand it out, as we would virtually be doing, would be wrong.

I agree with so much that the noble Lord, Lord Graham of Edmonton, just said about people buying houses, passing them on and their being turned into buy-to-let homes as commercial opportunities. That is worrying.

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The point that perhaps concerns me most is what my noble friend Lord Mackay said about this law not being quite right and having other legal implications. Can the Minister assure me that, if this amendment is carried, he will make a commitment that by the time we get to Third Reading he will come back with further amendments to make this amendment work in the way we want it to? That is why I am supporting the amendment today. However, I understand that, technically, unless the Minister indicates that he will look at it again, he might not have the right to do that at Third Reading. We have to be aware of that technicality as well.

Baroness Hollis of Heigham (Lab): The noble Baroness, Lady Gardner, made a very powerful point about the Minister considering the opinion of the House. Whether my noble friend will vote or not will be her judgment call.

The noble Lord, Lord Cormack, was absolutely right—this is the right amendment to the wrong Bill. The reason it is the wrong Bill is that we are actually back to front on this. I speak as chair of a housing association; I will be time-expired in the autumn. I remind the House that the bedroom tax is forcing up arrears; tenants’ incomes have been not only frozen but cut, given some of the Budget changes; rents will be reduced; the HCA grant no longer makes new build possible; and we are increasingly dependent, therefore, on arrangements with local authorities, private bodies or charitable bodies to get the land on which we can continue to build affordable homes. Given the proposal to add the right to buy, I am going to be spending a lot of the rest of this month trying to see whether a housing association such as mine will actually be around in a few years’ time. In fact, I think it will be gutted.

As I say, I hope I am wrong. I very much hope, as the noble Lord, Lord Cormack, said, that the other place will make adjustments to the Bill. We all want to promote home ownership and the shared ownership that housing associations can build; that would be the best way forward. None the less, we should protect and ring-fence housing associations, which can make an unequalled contribution, particularly in rural areas, to the viability of communities and enable young people who have nowhere else to rent and can never afford to buy to stay in villages and small towns. My local authority has lost nearly 40% of its best stock—semi-detached houses, 12 to the acre, overlooking the park where the sun always shines. They have gone and we are left with maisonettes and walk-up flats. The properties that we sold have been recycled and are now occupied by three or four students—often creating some nuisance, I am afraid, for the next-door neighbours, but with great profits to the owners. That was never the intention.

We have a dilemma. If my noble friend is satisfied with the Minister’s reply and does not think it right to test the opinion of the House on whether such protection for charities should be foremost in our minds when considering the housing association Bill, we will have missed an opportunity. Our colleagues in the other place should take into account the worries and views of this House, expressed so powerfully by the noble

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Lords, Lord Kerslake and Lord Best, and my noble friend Lord Campbell-Savours. I do not usually use phrases like “sending a message” or “sending a signal” but we have an opportunity to say that, while we accept that this is not the right Bill to carry an amendment like this, the House is extremely concerned about the future viability of housing associations. Housing associations such as mine, which do not deal with stock transferred from local authorities, were charitable from the beginning. We may lose that stock and find that we do not exist as a charity in a few years’ time; and here, we have a Bill that is about charities.

I understand the well founded misgivings of the noble Lord, Lord Cormack—he may be right intellectually—and the concerns of the noble and learned Lord, Lord Mackay of Clashfern, with whom this issue can be discussed further. He is absolutely right to say that CPO powers have always been used, but they none the less have to be verified all the way up to ensure that they are being used appropriately. As a local authority leader I have, in the past, gone for CPO powers. However, with those reservations, we need today to say that we are worried about charities. We could say to the National Trust that we will take its assets to refurbish the Palace of Westminster. Why not? Dealing with a grade 1 listed building would be a perfectly legitimate use of the trust’s assets, but no one would go down that route. However, we are doing something similar to housing associations whose distinctive characteristic is that they are charities, and whose purpose, rationale, finances and viability may be deformed by proposals that are going to come our way.

In the light of everything that has been said—including the powerful remarks of the noble Lord, Lord Cormack—if this House decides to accept my noble friend’s amendment and to say to the other place, “Think again before you go ahead with that Bill”, on this occasion, that is the right thing to do.

Viscount Eccles (Con): My Lords, if signals are to be sent, Hansard is the place in which they can be read. Ministers on our Front Bench are also very good at passing on the feeling of this House. If we were to pass this amendment, we would be placing a duty on the Charity Commission that it would never be able to perform. It only needs Parliament to make some decision or another for this amendment to become inoperable by the commission. As the noble and learned Lord, Lord Hope of Craighead, said, the commission must be hoping that the amendment is not passed, because it would in no way be in its interests if it were.

Lord Beecham (Lab): My Lords, I declare my local authority interests, one of which is to represent the ward in which the mother of the noble Lord, Lord Graham, used to live, in a rather—at that point—grim housing association block. It was part of the Sutton’s estate, which has been transformed over recent years. It now provides extremely good and very popular housing, and there are other housing associations in the same small ward in my local authority, Newcastle. Anchor in particular has two or three developments. It is worrying that the Government’s arrant intention to

20 July 2015 : Column 918

nationalise with a view to privatising, which is effectively what their policies on social housing amount to, will impact on that provision.

The amendment does not address the issue of housing only. Other charities might well be caught by other developments of the kind the Government propose to bring forward in relation to housing. For example, one could envisage charities running medical services—hospitals, perhaps—being required to put those on the market and dispose of them to other organisations. There will be other examples. The National Trust is one; it is an interesting thought that your Lordships’ House and others might be saved by acting towards them as is apparently intended towards housing associations—I suspect that that is unlikely to happen. But there is a principle here which is wider than the important and topical principle of social housing, and could apply across a range of functions carried out by charities. For that reason, it is important for this House to consider the amendment seriously.

Some of the questions raised by the noble and learned Lords, Lord Hope and Lord Mackay, and the noble Lord, Lord Cormack, are valid: the wording of the amendment is perhaps not ideal. But it is not enough simply to say that Hansard will be read by Ministers at the other end and that is all there is to it. An amendment passed by this House would require fuller consideration than simply a reading of Hansard would be likely to engender. In any event, in the House of Commons it is possible to refine and improve the amendment to meet the points that the noble and learned Lords raised about the precise wording.

While we may well have an opportunity, unfortunately, of returning to this subject in the event of a specific measure coming from the Commons in relation to housing, it would be a sensible course to take to pass the amendment, particularly in view of the great concern expressed by the social housing movement. I bear in mind particularly the reference of the noble Lord, Lord Palmer, to the financing of future development, given that housing associations borrow against the value of their stock. If that is to be diminished, as it would be over time, it would obviously weaken them. But, as I have said, it is not the only case which gives rise to concern. On that basis, I hope that, if my noble friend decides to test the opinion of the House, your Lordships will support her, and encourage and facilitate a review of the position by the Government and the Commons.

Lord Hodgson of Astley Abbotts (Con): My Lords, the House should not lose sight of the central purpose of this Bill, which is to make more effective—to improve—the regulatory powers of the Charity Commission and to enable the development of the social investment movement. This is the first in a series of amendments—including Amendment 17, on the right to right to make representations, and Amendment 19, on public benefit—that are outwith that purpose. I have heard all parts of the House rail and criticise Governments for bringing forth what they call Christmas tree Bills. If we are not careful, we are in danger of creating such a Bill here, because we are making amendments to the purposes of the Bill and the responsibilities of the Charities Commission that are

20 July 2015 : Column 919

quite outwith the original idea. Indeed, they are outside the remit that the Joint Committee, led by the noble and learned Lord, Lord Hope of Craighead, undertook.

We need to focus on the central issue: we need to give the Charity Commission the additional powers that the sector believes it should have and that the Charity Law Association and others generally believe are needed. If we go down the slippery slope of trying to add more bells and whistles to the Bill at this stage, we will be making a big mistake. I hope that the movers of the amendment will not wish to test the opinion of the House, because that could land us in position we do not want to be in.

4.15 pm

Lord Bridges of Headley: My Lords, at the start of the debate, I said that I was delighted at the level of cross-party agreement on so much of this Bill. However, this is clearly one of the very few clauses and amendments on which we differ. I have obviously listened to the speeches that have been made this afternoon and read the debates with other points that have been raised by a number of noble Lords in recent weeks. Clearly, a number of noble Lords feel extremely strongly on this issue. We have heard passionate speeches from the noble Lords, Lord Kerslake, Lord Palmer and Lord Campbell-Savours, to name just three.

While I may disagree with some—and in some cases a little more than some—of what has been said, I obviously respect the arguments that have been made. As has been said by a number of noble Lords, I know that my right honourable friend the Secretary of State for Communities and Local Government will read this debate with not just interest but great care.

Noble Lords will be pleased to hear that I will not bombard them with statistics or facts to try to underpin the rationale behind the Government’s policy for right to buy—for which, as noble Lords all know, the Government secured a mandate at the general election. Neither, at the risk of aggravating and frustrating noble Lords still further, will I get into the detail of how that policy will work. I regret that I cannot do so and I will not insult noble Lords’ intelligence by trying to pretend that the right-to-buy policy has nothing to do with the charities sector—of course it does. But I ask noble Lords to consider the point has been made by a number of previous speakers—surely the time and place to debate the right-to-buy policy will be when the Housing Bill is before Parliament and the details of that policy are before this House.

Furthermore, many of us agree that although the Bill touches on the issue of other areas of law such as the financing of terrorist organisations, we should not in that case attempt to review counterterrorism legislation in the Bill. So, too, here and now is not the time to debate and decide on housing policy and how it interacts with the charities sector. Furthermore, I know that my noble friend Lady Williams of Trafford has an open door to any noble Lord who may wish to discuss this with her in the weeks and months ahead.

On the actual amendment, I beg to differ with the noble Baroness, Lady Hayter. It does not simply state the existing legal position. I will explain why. The law governing charitable assets is rooted in case law. As I

20 July 2015 : Column 920

am sure many noble Lords will agree, a real difficulty with creating a simple statutory provision for a large area of case law is that it will invariably fail to cover the many complexities that often arise, and it will be exceptionally difficult to find a satisfactory expression that would properly cover the explanation and nuanced analysis that is often afforded in judgments in case law. Moreover, there is a real danger of agreeing to a statutory provision that could give rise to unintended consequences.

The wording in the amendment that charities may not,

“use or dispose of their assets”,

will cover property assets other than land, such as investments. This raises a whole separate issue with the duties that apply to a charity’s assets that are not land.

Furthermore, Charity Commission guidance on the disposal of land makes clear that such disposal must be in the best interests of the charity and in furtherance of the charitable purposes, or for the best price available, rather than be consistent with charitable purposes. These concepts have very different meanings, the latter being much wider in its potential application. Giving the Charity Commission a new and enhanced role in policing the disposal of charity assets is inconsistent with the current aim of helping the commission to focus on its core regulatory responsibilities. Requiring it to ensure that charities are not required to dispose of assets would be more than just an unwelcome distraction for the regulator.

As I mentioned in Committee, there is also the preserved right to buy in relation to housing associations, and the right to acquire. These existing rights could be undermined by this amendment.

I hope that noble Lords will see that the amendment proposed is problematic for a number of reasons. That being said, I repeat: I recognise that there are significant concerns about how the proposed policy to extend right to buy will be applied to charitable housing associations, but I would respectfully reiterate to your Lordships that the time and the place for that debate is the housing Bill. Finally, although we clearly disagree on this issue, I should like to repeat my thanks to the noble Baroness, Lady Hayter, for her co-operation on and contribution to many aspects of the Bill. I hope that, on reflection on this point, she will decide not to press the amendment.

Baroness Hayter of Kentish Town: My Lords, I thank the Minister for that and I thank all speakers who, on the substance, it seems to me, agreed with what we are trying to achieve. The difficulties are over whether this is the right Bill or the right wording, which basically says that the Charity Commission must make sure that,

“independent charities are not compelled to use or dispose of their assets in a way which is inconsistent with their charitable purposes”.

If the wording can be better than that—if it should be something such as the “best interests” of charities, as the Minister says—I will be very content, if the amendment is passed, to work with him at Third Reading to make the wording correct and acceptable

20 July 2015 : Column 921

to the Charity Commission and to the charity lawyers, who know far more about wording than I do.

On the issue, there are two things that I want to say. The first comes from what the noble Baroness, Lady Barker, said. This is a Bill about the protection of charities, and we are trying to protect charitable assets so that the money can be used for what the donors wanted when they bequeathed it. The idea of putting it on to the Charity Commission is that, basically, somebody has to protect charities from being compelled by someone else—not by their charitable trustees—to do something with the money that those who gave it did not intend.

The noble and learned Lord, Lord Mackay, asked about compulsory purchase for a road. In a sense it is always the public sector that does that; it is nationalisation. The land is taken over so that a road can be built. I said in a meeting with the Minister that it was not normally his party that wanted to nationalise things, so I am interested that over charitable housing that is what the Government want. We are talking about a swathe of housing—not one or two in the way of a new train line—that over time will undoubtedly be held by the private sector.

My second issue is that we are not talking just about housing—albeit that we have heard about the Peabody, Keswick and Sutton housing associations. We are also talking about that wider big society. I used to work in alcohol misuse issues; we ran a lot of social care. It could be our assets, under another Bill, where the Government felt that they wanted to use them in a certain way that we as an independent charity, which had raised the money, did not want to do. We have heard about the National Trust—or indeed, it could be hospitals or hospices.

The issue is not just about housing, which is why it is not appropriate to leave it to a housing Bill. We want to state something very simply: where money has been donated to an independent charity for a particular purpose, the trustees must abide by their trustee duty to make sure that the assets are used there. That is something on which this House would like to take a view.

4.25 pm

Division on Amendment 7

Contents 257; Not-Contents 174.

Amendment 7 agreed.

Division No.  1


Adams of Craigielea, B.

Addington, L.

Ahmed, L.

Anderson of Swansea, L.

Andrews, B.

Armstrong of Hill Top, B.

Ashdown of Norton-sub-Hamdon, L.

Avebury, L.

Bach, L.

Bakewell, B.

Bakewell of Hardington Mandeville, B.

Barker, B.

Bassam of Brighton, L. [Teller]

Beecham, L.

Best, L.

Bhattacharyya, L.

Blackstone, B.

20 July 2015 : Column 922

Blood, B.

Boateng, L.

Boothroyd, B.

Bradley, L.

Brinton, B.

Brooke of Alverthorpe, L.

Brookman, L.

Browne of Belmont, L.

Cameron of Dillington, L.

Campbell of Surbiton, B.

Campbell-Savours, L.

Cashman, L.

Chandos, V.

Chidgey, L.

Christopher, L.

Clancarty, E.

Clark of Windermere, L.

Clarke of Hampstead, L.

Clement-Jones, L.

Clinton-Davis, L.

Collins of Highbury, L.

Colville of Culross, V.

Corston, B.

Cotter, L.

Cox, B.

Craigavon, V.

Crawley, B.

Crisp, L.

Cromwell, L.

Cunningham of Felling, L.

Davies of Oldham, L.

Dean of Thornton-le-Fylde, B.

Deech, B.

Desai, L.

Dholakia, L.

Donaghy, B.

Donoughue, L.

Doocey, B.

Drake, B.

Dubs, L.

Elder, L.

Elystan-Morgan, L.

Erroll, E.

Evans of Temple Guiting, L.

Falkner of Margravine, B.

Farrington of Ribbleton, B.

Faulkner of Worcester, L.

Fearn, L.

Finlay of Llandaff, B.

Foster of Bishop Auckland, L.

Gale, B.

Garden of Frognal, B.

Gardner of Parkes, B.

German, L.

Giddens, L.

Glasgow, E.

Glasman, L.

Goddard of Stockport, L.

Golding, B.

Gordon of Strathblane, L.

Gould of Potternewton, B.

Graham of Edmonton, L.

Greenfield, B.

Greengross, B.

Greenway, L.

Grender, B.

Grey-Thompson, B.

Grocott, L.

Hameed, L.

Hamwee, B.

Hanworth, V.

Harris of Haringey, L.

Harris of Richmond, B.

Harrison, L.

Hart of Chilton, L.

Haskel, L.

Haworth, L.

Hayman, B.

Hayter of Kentish Town, B.

Healy of Primrose Hill, B.

Henig, B.

Hollick, L.

Hollins, B.

Hollis of Heigham, B.

Howarth of Newport, L.

Howe of Idlicote, B.

Howells of St Davids, B.

Howie of Troon, L.

Hughes of Woodside, L.

Humphreys, B.

Hunt of Kings Heath, L.

Hussain, L.

Hussein-Ece, B.

Hylton, L.

Irvine of Lairg, L.

Janke, B.

Jolly, B.

Jones, L.

Jones of Cheltenham, L.

Jones of Moulsecoomb, B.

Jones of Whitchurch, B.

Judd, L.

Kennedy of Cradley, B.

Kennedy of Southwark, L.

Kerslake, L.

King of Bow, B.

Kinnock, L.

Kinnock of Holyhead, B.

Kirkhill, L.

Kirkwood of Kirkhope, L.

Knight of Weymouth, L.

Kramer, B.

Laming, L.

Lawrence of Clarendon, B.

Lea of Crondall, L.

Lee of Trafford, L.

Lennie, L.

Lester of Herne Hill, L.

Liddell of Coatdyke, B.

Liddle, L.

Lipsey, L.

Loomba, L.

Low of Dalston, L.

Ludford, B.

McAvoy, L.

Macdonald of Tradeston, L.

McFall of Alcluith, L.

McIntosh of Hudnall, B.

MacKenzie of Culkein, L.

McKenzie of Luton, L.

McNally, L.

Maddock, B.

Mallalieu, B.

Manzoor, B.

Masham of Ilton, B.

Massey of Darwen, B.

Maxton, L.

Meacher, B.

Mendelsohn, L.

Monks, L.

Morgan, L.

Morgan of Huyton, B.

Morris of Handsworth, L.

Morris of Yardley, B.

Newby, L.

Northover, B.

Nye, B.

O'Loan, B.

O'Neill of Clackmannan, L.

Paddick, L.

Palmer of Childs Hill, L.

Parminter, B.

Patel of Bradford, L.

Pendry, L.

Pitkeathley, B.

20 July 2015 : Column 923

Plant of Highfield, L.

Prashar, B.

Prescott, L.

Prosser, B.

Purvis of Tweed, L.

Quin, B.

Ramsay of Cartvale, B.

Randerson, B.

Rea, L.

Rees of Ludlow, L.

Reid of Cardowan, L.

Rennard, L.

Richard, L.

Robertson of Port Ellen, L.

Rodgers of Quarry Bank, L.

Rogan, L.

Rooker, L.

Rosser, L.

Rowe-Beddoe, L.

Rowlands, L.

Royall of Blaisdon, B.

St John of Bletso, L.

Scotland of Asthal, B.

Scriven, L.

Sharkey, L.

Sharp of Guildford, B.

Sherlock, B.

Shipley, L.

Shutt of Greetland, L.

Simon, V.

Singh of Wimbledon, L.

Slim, V.

Smith of Basildon, B.

Smith of Newnham, B.

Snape, L.

Soley, L.

Somerset, D.

Stern, B.

Stevenson of Balmacara, L.

Stoddart of Swindon, L.

Stone of Blackheath, L.

Stoneham of Droxford, L.

Storey, L.

Strasburger, L.

Suttie, B.

Symons of Vernham Dean, B.

Taylor of Blackburn, L.

Taylor of Bolton, B.

Taylor of Goss Moor, L.

Thomas of Gresford, L.

Thomas of Winchester, B.

Thornton, B.

Tomlinson, L.

Tope, L.

Touhig, L.

Tunnicliffe, L. [Teller]

Turnberg, L.

Turner of Camden, B.

Tyler, L.

Tyler of Enfield, B.

Uddin, B.

Verjee, L.

Walker of Gestingthorpe, L.

Wallace of Saltaire, L.

Wallace of Tankerness, L.

Walmsley, B.

Walpole, L.

Warner, L.

Warwick of Undercliffe, B.

Watson of Invergowrie, L.

West of Spithead, L.

Wheeler, B.

Whitaker, B.

Whitty, L.

Wilkins, B.

Williams of Baglan, L.

Williams of Crosby, B.

Williams of Elvel, L.

Willis of Knaresborough, L.

Winston, L.

Wood of Anfield, L.

Woolmer of Leeds, L.

Worthington, B.

Wrigglesworth, L.

Young of Hornsey, B.


Aberdare, L.

Ahmad of Wimbledon, L.

Altmann, B.

Ashton of Hyde, L.

Astor of Hever, L.

Attlee, E.

Baker of Dorking, L.

Balfe, L.

Bates, L.

Bell, L.

Berridge, B.

Bew, L.

Black of Brentwood, L.

Blackwell, L.

Blencathra, L.

Bowness, L.

Brabazon of Tara, L.

Brady, B.

Bridgeman, V.

Bridges of Headley, L.

Brougham and Vaux, L.

Brown of Eaton-under-Heywood, L.

Browning, B.

Buscombe, B.

Byford, B.

Caithness, E.

Callanan, L.

Carrington of Fulham, L.

Cathcart, E.

Chisholm of Owlpen, B.

Colwyn, L.

Cope of Berkeley, L.

Cormack, L.

Courtown, E.

Craig of Radley, L.

Crickhowell, L.

Cumberlege, B.

Dannatt, L.

De Mauley, L.

Dear, L.

Deben, L.

Denham, L.

Dixon-Smith, L.

Dundee, E.

Dunlop, L.

Dykes, L.

Eaton, B.

Eccles, V.

Eccles of Moulton, B.

Elton, L.

Empey, L.

Evans of Bowes Park, B.

Farmer, L.

Faulks, L.

Fellowes, L.

Fellowes of West Stafford, L.

Finkelstein, L.

Flight, L.

Fookes, B.

Forsyth of Drumlean, L.

Fowler, L.

Framlingham, L.

Freeman, L.

20 July 2015 : Column 924

Freud, L.

Gardiner of Kimble, L. [Teller]

Geddes, L.

Glenarthur, L.

Gold, L.

Goldie, B.

Goodlad, L.

Goschen, V.

Griffiths of Fforestfach, L.

Hamilton of Epsom, L.

Hannay of Chiswick, L.

Helic, B.

Henley, L.

Heyhoe Flint, B.

Higgins, L.

Hodgson of Abinger, B.

Hodgson of Astley Abbotts, L.

Holmes of Richmond, L.

Hooper, B.

Hope of Craighead, L.

Horam, L.

Howard of Rising, L.

Howe, E.

Howell of Guildford, L.

Hunt of Wirral, L.

James of Blackheath, L.

Jay of Ewelme, L.

Jenkin of Kennington, B.

Jopling, L.

Kakkar, L.

Keen of Elie, L.

King of Bridgwater, L.

Knight of Collingtree, B.

Lamont of Lerwick, L.

Lang of Monkton, L.

Lawson of Blaby, L.

Leach of Fairford, L.

Lexden, L.

Lindsay, E.

Lingfield, L.

Listowel, E.

Liverpool, E.

Livingston of Parkhead, L.

Lothian, M.

Lucas, L.

Luce, L.

Lyell, L.

McColl of Dulwich, L.

Mackay of Clashfern, L.

Magan of Castletown, L.

Mancroft, L.

Marlesford, L.

Maude of Horsham, L.

Mawhinney, L.

Mawson, L.

Mobarik, B.

Moore of Lower Marsh, L.

Morris of Bolton, B.

Moynihan, L.

Naseby, L.

Nash, L.

Neville-Jones, B.

Neville-Rolfe, B.

Newlove, B.

Noakes, B.

Norton of Louth, L.

O'Cathain, B.

O'Neill of Gatley, L.

Oppenheim-Barnes, B.

Patten, L.

Patten of Barnes, L.

Perry of Southwark, B.

Prior of Brampton, L.

Rana, L.

Rawlings, B.

Ribeiro, L.

Ridley, V.

Risby, L.

Rose of Monewden, L.

Ryder of Wensum, L.

Sassoon, L.

Scott of Foscote, L.

Seccombe, B.

Selborne, E.

Selkirk of Douglas, L.

Selsdon, L.

Shackleton of Belgravia, B.

Sharples, B.

Sheikh, L.

Shephard of Northwold, B.

Sherbourne of Didsbury, L.

Shields, B.

Shrewsbury, E.

Spicer, L.

Stedman-Scott, B.

Stowell of Beeston, B.

Suri, L.

Swinfen, L.

Taylor of Holbeach, L. [Teller]

Trefgarne, L.

Trimble, L.

True, L.

Tugendhat, L.

Ullswater, V.

Wakeham, L.

Warsi, B.

Wheatcroft, B.

Williams of Trafford, B.

Wilson of Tillyorn, L.

Wright of Richmond, L.

Younger of Leckie, V.

4.39 pm

Clause 9: Automatic disqualification from being a trustee

Amendments 8 and 9

Moved by Lord Bridges of Headley

8: Clause 9, page 7, line 10, after “D” insert—

“(a) ”

9: Clause 9, page 7, line 11, at end insert “;

(b) for “to which P was privy,” substitute “which P knew of and failed to take any reasonable step to oppose”.”

Amendments 8 and 9 agreed.

20 July 2015 : Column 925

Amendment 10

Moved by Lord Bridges of Headley

10: Clause 9, page 7, line 26, at end insert—

“Case K

P is subject to the notification requirements of Part 2 of the Sexual Offences Act 2003.”

Lord Bridges of Headley: My Lords, I rise to move this amendment, which is also in the names of the noble Baroness, Lady Hayter, and the noble Lord, Lord Watson of Invergowrie.

Despite what has just happened, I must start by paying tribute to the noble Baroness, Lady Hayter, for her pursuit of this cause. The very first time I met the noble Baroness, just minutes after my introduction, she highlighted this flaw in the Bill, with great charm but with her characteristic force of conviction. As I have said before, I am in complete agreement with her and other noble Lords in wanting to protect children and vulnerable adults from the risk of abuse in charities.

In Committee, the noble Baroness presented a compelling case for automatic disqualification to extend to sex offenders. I am pleased, therefore, to respond with Amendment 10, which will do just that. I was delighted that the noble Baroness, Lady Hayter, and the noble Lord, Lord Watson of Invergowrie, put their names to this amendment. I think it goes to show the breadth of support for this measure. I just hope that the noble Baroness will not reprimand me for stealing her thunder.

Amendment 10 adds a new case, case K, to the criteria that give rise to automatic disqualification from charity trusteeship and senior management positions. Case K is a person who is subject to the notification requirements in Part 2 of the Sexual Offences Act 2003, often referred to as being on the sex offenders register. Such a person is considered to require monitoring in order to manage the risk of sexual harm they may pose to the public. Our policy rationale is that they are unfit to be in a position of trust, controlling funds held and activities carried out for the public benefit, and should be disqualified from being a charity trustee or being in a senior management role within a charity unless and until they are no longer subject to notification requirements or are granted a waiver from the disqualification by the Charity Commission; for instance, the commission might consider it appropriate to grant a waiver to enable someone to take up a position in a charity that works with ex-offenders.

The unfitness results not just from the fact that it would damage public trust and confidence in charities if someone in that position were able to serve as a trustee or in a senior management role but because people in such roles may well have privileged access to children or vulnerable people, even if the charity is not routinely working with such groups; in other words, its trustees and employees would not necessarily be subject to Disclosure and Barring Service checks. The noble Baroness, Lady Hayter, gave a good example in Committee of a charity which provides a community hall that is used by Girl Guides or for children’s parties.

As I said in Committee, automatic disqualification of sex offenders does not in any way mean that charities can lower their guard. Charities must still have in

20 July 2015 : Column 926

place robust policies and procedures to safeguard their beneficiaries, and where charities are undertaking regulated activity they will still need to obtain Disclosure and Barring Service checks. But the amendment will, I am sure, result in greater protection of children and vulnerable adults from risk of abuse in charities. Given the number of historic cases that have come to light across all sectors of society, anything that reduces that risk is to be welcomed. I thank the noble Baroness and the noble Lord for their support, and I commend the amendment to the House.

Baroness Hayter of Kentish Town: My Lords, I have only two things to say: thank you and sorry. The Minister had only just taken off his red gown after being introduced when I got at him about this, and that does need an apology. I also want to thank him for engaging with us on this, for having got exactly the right amendment and for describing it far better than I could. I also think it shows the value of your Lordships’ House that, on an issue such as this that does not divide us politically, we have the same aims of protecting young people and we are able to work together to move this forward. My noble friend and I are very happy to support this amendment.

Amendment 10 agreed.

4.45 pm

Clause 10: Power to disqualify from being a trustee

Amendments 11 to 13C

Moved by Lord Bridges of Headley

11: Clause 10, page 11, line 4, leave out “either”

12: Clause 10, page 11, line 5, leave out “or privy to”

13: Clause 10, page 11, line 6, after “mismanagement,” insert—

“( ) the person knew of the misconduct or mismanagement and failed to take any reasonable step to oppose it,”

13A: Clause 10, page 11, line 12, leave out “either”

13B: Clause 10, page 11, line 13, leave out “or privy to”

13C: Clause 10, page 11, line 14, after “mismanagement,” insert—

“( ) the person knew of the misconduct or mismanagement and failed to take any reasonable step to oppose it,”

Amendments 11 to 13C agreed.

Amendment 14

Moved by Lord Bridges of Headley

14: After Clause 12, insert the following new Clause—


(1) Section 59 of the Charities Act 1992 (prohibition on certain fund-raising without agreement in prescribed form) is amended as follows.

(2) In subsection (6) for “such requirements” substitute “the requirement in subsection (7) and such other requirements (including any requirements supplementing subsections (7) and (8))”.

(3) After that subsection insert—

“(7) The requirement in this subsection is that the agreement must specify all of the following—

(a) any voluntary scheme for regulating fund-raising, or any voluntary standard of fund-raising, that the professional fund-raiser or commercial participator undertakes to be bound by for the purposes of the agreement;

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(b) how the professional fund-raiser or commercial participator is to protect vulnerable people and other members of the public from behaviour within subsection (8) in the course of, or in connection with, the activities to which the agreement relates;

(c) arrangements enabling the charitable institution to monitor compliance with subsection (1) or (2) by reference to the agreement.

(8) The behaviour mentioned in subsection (7)(b) is—

(a) unreasonable intrusion on a person’s privacy;

(b) unreasonably persistent approaches for the purpose of soliciting or otherwise procuring money or other property;

(c) placing undue pressure on a person to give money or other property.”

(4) In the Charities Act 2011, after section 162 insert—

“162A Annual reports: fund-raising standards information

(1) If section 144(2) applies to a financial year of a charity, the annual report in respect of that year must include a statement of each of the following for that year—

(a) the approach taken by the charity to activities by the charity or by any person on behalf of the charity for the purpose of fund-raising, and in particular whether a professional fund-raiser or commercial participator carried on any of those activities;

(b) whether the charity or any person acting on behalf of the charity was subject to an undertaking to be bound by any voluntary scheme for regulating fund-raising, or any voluntary standard of fund-raising, in respect of activities on behalf of the charity, and, if so, what scheme or standard;

(c) any failure to comply with a scheme or standard mentioned under paragraph (b);

(d) whether the charity monitored activities carried on by any person on behalf of the charity for the purpose of fund-raising, and, if so, how it did so;

(e) the number of complaints received by the charity or a person acting on its behalf about activities by the charity or by a person on behalf of the charity for the purpose of fund-raising;

(f) what the charity has done to protect vulnerable people and other members of the public from behaviour within subsection (2) in the course of, or in connection with, such activities.

(2) The behaviour within this subsection is—

(a) unreasonable intrusion on a person’s privacy;

(b) unreasonably persistent approaches for the purpose of soliciting or otherwise procuring money or other property on behalf of the charity;

(c) placing undue pressure on a person to give money or other property.

(3) In this section—

(a) “commercial participator” and “professional fund-raiser” have the meaning given by section 58 of the Charities Act 1992 (control of fund-raising: interpretation);

(b) “fund-raising” means soliciting or otherwise procuring money or other property for charitable purposes.

(4) Section 58(6) and (7) of the Charities Act 1992 (references to soliciting money etc) apply for the purposes of this section as they apply for the purposes of Part 2 of that Act.””

Lord Bridges of Headley: My Lords, I am again grateful to the noble Baroness for tabling her amendments and for bringing this issue to the attention of the House. I will first speak to Amendment 14 tabled in my name.

When this issue was debated only a few weeks ago, I said that three questions needed to be answered: first, whether the standards fundraisers have set themselves

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are set high enough; secondly, whether the structures for self-regulation are the right ones; and thirdly, whether fundraisers and the charity trustees who oversee them accept the need for change to ensure that donors are treated with honesty, respect and decency. We now know rather more about all three issues, and on all three, more needs to be done to maintain and strengthen the public trust in charities—which is a key underlying aim of the entire Bill.

On the first, the news since that debate has been profoundly depressing. The revelations in the Daily Mail did what investigative journalism is supposed to do: shine a light on people who are treating others badly because they think no one is looking. I thank the newspaper for doing that. Of course, the stories in the Mail do not typify the majority of fundraisers, who are in the main thoroughly decent people doing a vital job, be it holding jumble sales, doing fun runs or hosting large charity events. However, allegations of inappropriate pressure being placed on those with dementia and of ludicrously self-serving interpretations of the law on data sharing have rightly angered broad swathes of the community, and many in the charity and fundraising sectors too.

I know that the fundraising sector has tried to respond and that the self-regulatory bodies are working on a number of proposals on issues such as cold calling, data sharing and regularity of contact. In part this has been in response to the challenge laid down by my honourable friend in the other place, the Minister for Civil Society, Rob Wilson, who has been working hard on this matter and has put in place some swift measures to bolster public confidence. He and I—and I think the noble Baroness, Lady Hayter—agree that this work needs to continue apace. But the answers the fundraising bodies have so far provided are piecemeal and do not comprise a convincing answer to the second question, which is whether the system as a whole is the right one. Indeed, I think few observers would argue that the system’s response under the stress of the last few weeks has made a compelling case that it is.

I therefore very much welcome the fact that Sir Stuart Etherington has accepted the Minister for Civil Society’s request to chair a cross-party panel to address just this question. I am delighted, too, that my noble friend Lord Leigh of Hurley, the noble Baroness, Lady Pitkeathley, and the noble Lord, Lord Wallace of Saltaire, have agreed to join that panel. The review will take a root and branch look at what is needed to ensure that we have a system that is fit for purpose and that supports public trust and confidence in charities. Sir Stuart has the licence to be bold and imaginative. His panel has set a brisk pace. It has met once and will report in late September. Its members have our full support.

The response of sector leaders to Sir Stuart’s findings will in part form the answer to the third question, of whether fundraisers and the charity trustees who oversee them accept and fully embrace the need for change. It is now quite clear that the leaders of some of our charities need to take much greater responsibility for the fundraising carried out in their name. We cannot have a “don’t ask, don’t tell” approach in the sector, where a charity’s CEO and trustees choose not to

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attend in any great depth to how their organisation engages the public when fundraising. The CEO’s responsibility for fundraising cannot end with simply demanding that the fundraising director brings the money in while he or she focuses exclusively on the charity’s mission in the field.

Our amendment seeks to address just this point in two ways. First, it would require third-party fundraising organisations, of the sort that featured so heavily in the recent Mail articles, to write their fundraising standards into their contracts with the charities that employ them. That would include how the fundraiser will protect vulnerable people and how the charity will monitor how standards are met. That way, all parties will be clear and upfront about what will be done in the charity’s name, and about their respective responsibilities.

Secondly, the amendment would require charities with incomes over £1 million to set out in their annual reports their approach to fundraising, whether they use paid third-party fundraisers and how they protect the wider public and vulnerable people in particular from undue pressure in their fundraising. Again, the point is to require the leadership of a charity to take responsibility for their fundraising practice and set it out for all to see. We know that this is only part of the picture and it is intended to complement a strengthened self-regulatory system, not to replace it. Furthermore, as in keeping with our entire approach, these measures seek to be proportionate and targeted to address the issues as we see them today.

I know, too, that the noble Baroness’s amendments are intended to ensure a well-regulated system, bringing in the valuable funds that serve beneficiaries while protecting the interests of the public who give that money. Clearly, the adequacy of the existing self-regulatory system—the elements of it and how they combine together—must be looked at afresh but state regulation is far from a panacea. We firmly believe that Sir Stuart’s panel should be given the chance to succeed and self-regulation to succeed with it. My concern is that the amendment pre-empts the review and in effect moves straight to statutory regulation, even as it cements one part of the existing self-regulatory landscape in place. I suggest we await Sir Stuart’s findings before we invest so heavily in the FRSB. As the noble Baroness said in Committee, the FRSB’s self-regulation system has so far “failed to work”.

As for the reserve power, that remains at Ministers’ disposal should self-regulation be found to be unworkable. However, I do not believe that we are yet at that point—I repeat, yet. Furthermore, statutory agencies such as the Information Commissioner and the Charity Commission are already permitted to intervene where there are serious abuses. I know that the former is investigating the GoGen allegations and has very significant sanctions at his disposal should serious wrongdoing be proved. I therefore continue to hope that the jolt the fundraising and charity sectors received in the last few weeks and the action we are taking will usher in an era of greater awareness and responsibility for fundraising within the sector.

I hope that on reflection the noble Baroness will not press her amendments. I thank the noble Lords,

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Lord Watson and Lord Wallace, the noble Baroness, Lady Pitkeathley, and my noble friends Lord Hodgson and Lord Leigh for their contributions on this issue. I beg to move.

Baroness Barker: My Lords, I thank the Minister for introducing this new amendment in such detail and making time available to explain its purpose to members of the Committee in meetings. I preface my remarks by returning to an observation I made at Second Reading about the alacrity with which some matters have been attended to. This is one of those occasions on which there is a great deal of haste which is perhaps not warranted and may not be helpful in trying to get to the root of the problem.

While the Minister wishes to commend the Daily Mail for its attention to this issue, I simply wish that the Daily Mail would turn its attention to the activities of many of the financial institutions of this country, not least the banks, in their treatment of people with Alzheimer’s, and other vulnerable adults. If it were to do that, it would rise in my estimation—not a difficult thing, I have to say. But if it genuinely cares about people who are vulnerable, rather than just wishing to have a go at charities, it will continue its campaign and look at the issue in a much wider way.

That said, everybody in the charity sector understands that that there is a problem—and the charitable sector has sought for some considerable time to deal with this issue. It has been a long-standing problem. I remember when I started working with charities 25 years ago, we were not dealing with the internet and there was not so much direct marketing, but there was direct marketing, and still the same complaints happened, although perhaps not to such a degree. I do not know whether noble Lords heard the Information Commissioner, Christopher Graham, on the “Today” programme a couple of weeks ago, addressing this exact issue. He was quite clear; he said that we did not need further legislation—that we have the legislation that we need.

The key issue is about the multiple use of donor lists by charities. We need to make sure that all charities are fully observant of existing data protection laws. We do not need the legislation. That said, the Government are to be commended on what they propose in this amendment. At the very least, it will cause the charitable sector to think long and hard about the regulation and guidance, which is what will really matter to charities’ daily activities. We should be in no doubt that charities have the right to continue to try to raise money, and they need to do so. It is not a question of whether they should—it is just how.

The Minister would expect on his first outing that an amendment of this nature would be subject to a number of queries and criticisms in your Lordships’ House. I would focus noble Lords’ attention on new subsection (8) in Section 59 of the Charities Act 1992, as proposed in the amendment. It talks about,

“unreasonable intrusion on a person’s privacy … unreasonably persistent approaches for the purpose of soliciting or otherwise procuring money or other property”,


“placing undue pressure on a person to give money or other property”.

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That is fine—but who decides what the definitions are, and who decides whether the activities of a charity have been unreasonable or have placed “undue pressure” on someone? When it has been decided that a charity has acted inappropriately, who is responsible for administering what sanctions to a charity that is found to be deficient?

A further point that I would like the Minister to address is how having this legislation would help a member of the public to understand what they should do were they to be on the receiving end of “undue pressure”, or if they knew of somebody else on the receiving end of such pressure. How would they know what to do?

I draw noble Lords’ attention to subsection (1)(e) of new Section 162A of the Charities Act 2011, as proposed in the amendment. It deals with the annual reports on fundraising standards that charities are supposed to bring forward under this legislation. They have to talk about,

“the number of complaints received by the charity or a person acting on its behalf about activities by the charity or by a person on behalf of the charity for the purpose of fundraising”.

5 pm

That is somewhat crude. The number of complaints means nothing unless it can be compared to some standard. Is it going to be compared to the number of complaints about other charities or what? It could be that a charity’s purpose is unpopular. It might be a drugs and alcohol charity. People may take exception to being contacted about that sort of issue. I would like to see a bit more fleshing out of exactly what we are expected to look at rather than crude numbers.

The Minister spoke about the commission which has been set up under the auspices of the NCVO, directed by Sir Stuart Etherington, and includes a number of Members of your Lordships’ House. Those of us who recently heard Sir Stuart speak on the sector at a large dinner will know that he is on a mission with this. The charitable sector knows that it has a problem. The problem has been gone over several times in the past few months by the Daily Mail for purposes which we can all imagine. The charitable sector wants to have a system which is as watertight as it can be to make sure that charities which are genuinely carrying out legitimate fundraising in an ethical manner can show that they are doing so and that we can weed out the very few organisations which are not.

Baroness Hayter of Kentish Town: My Lords, before I turn to the wording of this amendment, I say that in Committee the noble Baroness, Lady Barker, had to hear about the horrendous experience that Barclays Bank had just put my uncle though; he has Alzheimer’s. In response to her comments, I have today tabled a Question for Short Debate about how banks deal with vulnerable clients, so perhaps we can move together on that.

Unfortunately, other than on that, I take a different view on the amendments the Government have tabled. I thank the Minister for bringing forward these amendments. They are significant, and we warmly welcome them and the work set in hand with the

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committee he mentioned, whose recommendations we anticipate the second week in September. Looking round at the members, they will keep to that deadline, I am sure.

I, too, pay tribute to the Cooke family, who had to go through the inquest just last week, but who have been willing to share Olive Cooke’s experience of being bombarded with requests for charitable donations. I also join the Minister in congratulating the Daily Mail—coming from me, it may not like that—on its investigation and campaigning which revealed unacceptable practices, shortfalls in monitoring by the charities themselves and, as the Minister said, the weakness of the current self-regulation model.

It is perhaps odd that we have a regulator which does not regulate one vital bit of charitable activity, which is fundraising. This lies in the hands of a voluntary organisation, the Fundraising Standards Board, which works to a code adopted by the Institute of Fundraising. Three years ago, the noble Lord, Lord Hodgson, gave it five years to get more into line, and it has not yet done so. The Fundraising Standards Board and the Institute of Fundraising have not done their work particularly well. Interestingly, the code does not outlaw nor even limit cold calling, or even require caller line identification. The Fundraising Standards Board, in addition to signing up only two-thirds of those who ought to belong, does not publicise itself, so no one knows to take complaints there, and it does not monitor compliance, or it would not have to have been Mrs Cooke’s family or the Daily Mail that did that job. Even when it threw out a professional fundraising company, it seems to have taken it back in under another name.

That all lets down the charity sector and the enormous generosity of Britain’s charitable donors. I also believe, as noble Lords will understand from our amendment, that it questions whether self-regulation can work in this sector. Hence our Amendment 16, which would require charities and professional fundraisers to belong to the standards board. We recognise that that would have enormous consequences should they be removed from membership for misbehaviour. The NSPCC, one of the charities let down by the professional fundraisers, itself favours compulsory membership of the Fundraising Standards Board as, in its words, the current self-regulation system is too weak. We also think that it is time that the Charity Commission’s reserve powers were brought into play. I am reassured by the Minister’s words that that can be done fairly quickly if the Minister feels it is necessary. So for the moment we want to put our amendment on hold, as we warmly welcome the Government’s own amendments and we await Sir Stuart Etherington’s report.

Government Amendment 14 achieves a number of things. First, and I hope the family can take the benefit from this, it can indeed be seen as Olive’s law; it will mean that something will be on the statute book as a consequence of her experience. Secondly, it puts into the Bill the essence of a code, describing as unacceptable:

“unreasonable intrusion on a person’s privacy … unreasonably persistent approaches for the purpose of soliciting or otherwise procuring money … placing undue pressure on a person to give money”.

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As the noble Baroness, Lady Barker, intimates, the Charity Commission may well have to flesh that out a bit, but having that in the Bill is excellent. It makes it clear that such behaviour is unacceptable with regard to vulnerable people but also, in the Government’s words, to the wider public. We particularly welcome that; it is important. Oxfam’s submission to us, for example, concentrates very much on the vulnerable, especially those with Alzheimer’s. However, we believe that all unethical methods need to be stamped out, regardless of the target, so we welcome the Government’s wording on that.

Thirdly, the Government’s amendment will force large charities to state whether they are members of the FRSB. We hope, along with the Government, that that will shame non-members and their trustees because the trustees have to sign off in their annual reports their approach to fundraising and any complaints received. Boards of trustees will no longer be able to be grateful for the income without asking too many questions, as the Minister said. Importantly, the Government have set up what we think is a pretty powerful group—I am looking around at its members in the Chamber today—and we look forward to it reporting back before Third Reading about whether Amendment 14 will indeed do the trick. We welcome the group, as do the NSPCC and Oxfam, which has also suspended its contract with commercial fundraisers, and we look forward to its recommendations.

Should the group suggest that further amendments are needed, we will be happy to work with the Government to facilitate this. We might therefore want to pursue our amendment or some other at Third Reading, depending on what the Government’s review group advises and the Government’s own response to that. We have yet to be persuaded that membership of the FRSB should not be mandatory, or that the Charity Commission’s reserve powers should not be brought into force. However, we are reassured by the Minister’s words on this.

For the moment, I thank the Minister, and indeed his colleague in the Commons, who found time to meet us to discuss this, and for coming forward with such a good amendment. We will be very happy to support it when it is put to the vote shortly.

Lord Bridges of Headley: My Lords, I thank the noble Baronesses, Lady Barker and Lady Hayter, for their words. As with many other issues that we have discussed and will discuss, this is clearly one where we have clear agreement on both the changes that are necessary and the change that we want to bring about. I stress that the amendments we are looking at today represent a start of measures that are targeted at where we know the real problems have arisen: in fundraising agencies and where charity trustees have failed to ensure proper oversight of their charity’s fundraising practices. As the noble Baroness, Lady Hayter, just said, the review that Sir Stuart is conducting is now under way. If further legislation is needed, we will be able to consider that when the Bill goes to the other place. My honourable friend the Minister for Civil Society, Rob Wilson, has said that he will be

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happy to discuss the findings and recommendations on a cross-party basis; we will be happy to take that further.

As usual the noble Baroness, Lady Barker, made some forensic points on these clauses. I will attempt to answer them now, but if I fail to address them, I will be happy to pick them up with her after we have finished proceedings today. She asked who decides on the definition of “unreasonable”. In the first instance, the charity itself decides in setting the terms of its fundraising agreement, but ultimately the Charity Commission can intervene, using its existing powers, if the charity is not doing enough. That said—and this is an important point—the Charity Commission has already committed to updating its fundraising guidance later this year and will take these new requirements into account when it does so.

The second good question the noble Baroness asked was: what are the sanctions where charities are deficient? Here, it would be for the charity commission to decide where the charity fails to meet its obligations. The third question was: how will a member of the public know what to do if they feel that the charity is not meeting these new requirements? That is an extremely good point, and I can see that Sir Stuart’s review is absolutely key. We need to ensure that we focus on this issue from the point of view not just of the charity but of the public as well. Finally, as regards the number of complaints, that is another good point that we need to return to with Sir Stuart and in guidance, and I will make sure that is reflected by the Charity Commission.

To conclude, these amendments, coupled with the review being undertaken by Sir Stuart Etherington, give us a real opportunity to restore public trust and confidence in charity fundraising where, in the last few weeks, it has been found wanting.

Amendment 14 agreed.

Amendment 15

Moved by Lord Lea of Crondall

15: After Clause 12, insert the following new Clause—

“Charity Commission annual report to refer to principles of best regulatory practice

(1) Schedule 1 to the Charities Act 2011 is amended as follows.

(2) In paragraph 11(1)(c), after “16)” insert “including the extent to which, in its opinion, it acted in a proportionate, accountable, consistent, transparent and targeted manner (see section 16(4))”.”

Lord Lea of Crondall (Lab): My Lords, I will take just five minutes to move this amendment because I set out the reasoning at considerable length in Committee on 1 July, and the case that I made then still stands. I will restrict my remarks to developments since that time, notably at the United Nations. There are two main issues, and I contest the two main premises of the letter dated 13 July from the Minister, the noble Lord, Lord Bridges of Headley, in response to the questions that I posed on those issues then.

However, before I turn to those issues, perhaps the Minister will respond to a separate point that I made in Committee. The commission’s normal registration procedures can take a couple of years in what it

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considers to be a complicated case. They clearly do not match the requirements of a charity with a limited lifespan—in our case, of a little over one year. If ground-breaking fixed-term charities can in practice be arbitrarily ruled out for such reasons then it crosses the border between being simply an operational matter and a matter of public policy and the Government should address it. I would be grateful if the Minister will consider it before Third Reading.

I will now address the issue of the accountability of the Charity Commission, hence the reason for my proposed amendment to the present Act. My first bone of contention is the disingenuous way in which the commission went about blocking the application of the Hammarskjöld Inquiry Trust. This was purported to be—not exclusively, it said, but indispensably—on the grounds of the claimed lack of interest in the trust’s work on the part of the United Nations. This has indeed been the main bone of contention of the trustees as a body since we first made contact with the Charity Commission exactly three years ago. The Minister’s letter sidesteps the undisputed fact that the commission’s claim to that effect is now clearly seen to be plain wrong. As the Minister’s reply does not address that fact, I ask him once again whether he will take this opportunity to accept that that is so. If he wishes to deny it in the face of the pellucidly clear evidence now before us, on what grounds does he do so?

5.15 pm

On the related matter of whether the commission was influenced by the Government or the intelligence services, the Minister’s letter simply reports that the,

“Commission records do not indicate”,

that it had been “nobbled” in such a way. As Mandy Rice-Davies would undoubtedly have said, “Well, they wouldn’t, would they?”.

The second issue—one of global significance—is whether the British Government and our intelligence services, among those of other nations, perhaps I may add, including the United States National Security Agency, are or, even now, are not fully co-operating with the further investigations of the United Nations. In a letter to me dated 8 July, the United Nations Deputy Secretary-General encloses a memorandum introducing a report of the panel appointed by the UN General Assembly last autumn to review the evidence brought forward by the Hammarskjöld Commission. The Clerk’s office has kindly arranged for a copy of this material to be placed in the Library and noble Lords will therefore be able to judge for themselves.

The UN panel concludes, inter alia, that there is strong evidence that a second plane was involved in some way in causing the crash of the Secretary-General’s plane in Ndola in September 1961. If true, that would have been known about by the people in the control tower at Ndola airport, who probably included members of the British and Rhodesian security services. They were certainly at the airport.

The UN Secretary-General is now recommending that this autumn the General Assembly should agree to him pursuing requests for specific information made

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available by the panel to certain member states and urging all member states to declassify any relevant documents, having regard to the fact that it is now more than 50 years since the event. This is not referred to in the Minister’s letter dated 13 July. However, will he comment on it and will Her Majesty’s Government now co-operate fully with the United Nations in its further investigations?

Lord Bridges of Headley: My Lords, I understand that the noble Lord, Lord Lea, was obviously frustrated by the approach of the Charity Commission when he tried to register the Dag Hammarskjöld trust, and that his impression of the commission has been informed by and reflects that particular case. I must say that waiting several months for a response to a letter does not seem to be good customer service and I, too, would have been extremely frustrated.

For most charities with standard charitable purposes, the process for registration with the Charity Commission is quick and straightforward. In 2014-15, the commission registered over 4,600 charities. For organisations with purposes that are innovative or do not fall within previously recognised charitable purposes, the process of registration can indeed take longer. The law does not recognise wholly novel charitable purposes, but purposes can still be charitable if they are analogous to or within the spirit of charitable purposes specifically identified in the 2011 Act or if they were charitable purposes recognised by the common law before 1 April 2008. Where people want to register as a charity an organisation which has purposes that may not fall clearly within established categories of charitable purposes, the commission must proceed with caution in assessing whether the organisation really has been established for purposes that are charitable in law.

I turn to the specific issue of the Dag Hammarskjöld trust. I do not know all and every detail of the case and it is right that I should not, as the commission is operationally independent. However, as the noble Lord, Lord Lea, said, I have written to him responding to some of the specific questions he raised in Committee about what the Government knew about the case. I apologise to the noble Lord, but I cannot at this Dispatch Box add to the detail that was in the letter sent to him. I regret that, but I absolutely cannot—it is a very detailed case.

On his amendment—which is really what we are debating—the Charity Commission already reports its performance against principles of best regulatory practice, usually framed in terms of proportionality. It does this in its annual report, in its annual Tackling Abuse and Mismanagement report and in stand-alone case reports. I hope your Lordships will forgive me for not repeating the detailed ways in which it does all this as I set it out in Committee at length. This amendment, by highlighting one particular aspect of Section 16, casts doubt on the extent to which the commission should report on other aspects of its general duties. It is, in that respect, undesirable.

Finally, I hope the noble Lord, Lord Lea, will reconsider the offer from the Charity Commission’s chairman to meet him and discuss this case. I fear that I have not been able to reassure the noble Lord that his amendment is not necessary—although I hope that I

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have done so. I assure him that his difficulty in trying to register the Dag Hammarskjöld trust was not representative of the norm.

Lord Lea of Crondall: My Lords, I thank the Minister for that reply. On the first point, he clearly does not feel that there is anything amiss with the accountability of the Charity Commission. I think he is hiding behind the phrase “operational matter”. When a matter of this importance is put before the House, and with the detail that I have presented, is it not incumbent on the Cabinet Office or the Minister and his officials to look further into it? In other circumstances or areas, one could call it a miscarriage of justice.