The key person system is already well established, as required under the EYFS. The safeguarding and welfare requirements for registered early years providers are comprehensive, as is absolutely right. Parents want to be reassured that when they leave their child, or, indeed, grandchild, all aspects of their safety and welfare will be addressed.

I do not believe that we should single out any individual requirements in order to given them prominence in primary legislation. It seems odd to stipulate that regulations setting out what is meant by “high-quality” childcare must require that each child is allocated a key worker, but not mention the other requirements around safeguarding and welfare. In saying this, I am not downplaying the valuable role that the key person plays but I do not see a case for singling out their role in primary legislation. I think we are in agreement that secondary legislation is the right place for us to set out the comprehensive suite of requirements, but I did enjoy the noble Earl’s comments about Mrs Everest, aka “Woomany”.

In conclusion, I would like to reiterate that high-quality childcare, delivered by staff with the right skills and qualifications, which meets the needs of children, including those with special educational needs and disabilities, is a vital principle for this Government. I hope the noble Baronesses and the noble Earl have been reassured by my responses and I urge them to withdraw their amendments.

6 pm

The Earl of Listowel: My Lords, I am most grateful to the Minister for his careful response and to noble Lords who have tabled amendments and taken part in this important debate on quality. I should first point out that I made a couple of omissions in my opening

14 Oct 2015 : Column 273

statement because of my wish for brevity. The man I spoke of was, of course, Winston Churchill. Also, the Minister kindly made some comments to me earlier but I was not in my place. I assure him that I was stretching my legs behind the Bar and heard every word he said, but it was not a good time to choose to do so. I apologise for that.

I am grateful to the Minister for taking the time to answer in detail on these important matters. It is good to be reminded that he is developing a strategy for the early years workforce. It is most important to all of us, I am sure. I listened with interest to the debate about the importance of Ofsted versus the importance of high-quality qualifications for staff. I am very familiar with this issue from discussions about children’s homes, and there seems to be a parallel. Within the culture of residential care for looked-after children in this country, there is a strong conservative bias towards a low-qualified workforce and a high level of regulation. Many people working in this field and many authoritative figures would say, “We do not need higher qualified staff; we need good regulation and we will work with what we’ve got”. I have followed this issue for many years and have always taken the opposite view. We need highly qualified staff when working with such vulnerable children—even more so than the staff on the continent, who are definitely more highly qualified. I am very sympathetic to the argument of the noble Lord, Lord Storey. We should start with high-quality teachers and professionals, and then regulate to make sure everything is done properly. That is the motor to real improvement.

There is a concern about private group provision and the percentage of early years teachers in those settings. We should not be too prescriptive but we know how important having professionals in early years settings is, particularly for the most disadvantaged children. It is a matter of concern that nearly 50% of independent group providers do not have early years teachers in those settings. I am sure that this will be debated further in the other place. I welcome the Minister’s many comments about the improvement in the qualifications of the workforce during the last Government. I beg leave to withdraw the amendment.

Amendment 3 withdrawn.

Amendments 4 to 6 not moved.

14 Oct 2015 : Column 274

Baroness Evans of Bowes Park (Con): My Lords, I shall also speak to Amendments 8, 9, and 10, which concern eligibility for the extended entitlement.

The additional childcare provided for in the Bill builds on the existing entitlement to 15 hours of early education for three to four year-olds and disadvantaged two year-olds. The Government’s intention with this extended entitlement is to support working parents with the cost of childcare and to enable them, should they wish to do so, to return to work or to work more.

I will first address Amendment 10, tabled by the noble Baronesses, Lady Pinnock and Lady Tyler. While I understand that the noble Baronesses would like working parents of children aged between one and two to benefit from additional childcare, I can assure them that there is already a significant amount of support for parents of children in this age group. In the last Parliament we introduced the entitlement to 15 hours free childcare for disadvantaged two year-olds. We have legislated for tax-free childcare, which will save around 1.8 million working families with children under the age of 12 up to £2,000 per child per year. We have committed to increasing childcare support within universal credit by around £350 million, to provide 85% of childcare costs from next year, rather than the current 70%, where a lone parent or both parents in a couple are in work. The Government’s clear commitment is to increase the hours of free childcare available to working parents of three and four year-old children, when many parents feel more able to return to work.

Turning to those children that the Government intend to benefit from the new entitlement, our intention is that the criteria for accessing the entitlement will include conditions relating to paid work undertaken by the child’s parent or the parent’s partner. The criteria will be set out in regulations, rather than in the Bill, but our intentions are clearly signalled by Amendments 7 and 8. As set out in Committee, the amount of work parents will need to undertake will be set relatively low. Children of parents who earn at least the equivalent of eight hours per week at the national minimum wage, including those who are self-employed, will qualify for the extended entitlement. In the case of lone-parent households, the same threshold will apply. That makes this a significant offer of additional support.

We have considered carefully the debate in Committee about parents who may not be in a position to meet the minimum income threshold, for reasons which may be connected with incapacity for work, caring responsibilities or because they are temporarily away from the workplace. That is why the Government’s policy statement, published at the beginning of this month, set out further information on the circumstances in which we think that children of such parents should nevertheless qualify. The amendment we have brought forward would enable the Government to specify the circumstances in which a person should be regarded as in paid work for the purposes of the new entitlement. This would enable the Government to include, within regulations, those parents who are out of work or temporarily away from the workplace.

In summary, the Government intend that the additional entitlement should be available in the following circumstances: where both parents are employed but one or both parents is temporarily away from the

14 Oct 2015 : Column 275

workplace on parental, maternity or paternity leave; where both parents are employed but one or both parents is temporarily away from the workplace on adoption leave; where both parents are employed but one or both parents is temporarily away from the workplace on statutory sick pay; where one parent is employed and one parent has substantial caring responsibilities, based on specific benefits received for caring; or, finally, where one parent is employed and one parent is disabled or incapacitated, based on receipt of specific benefits. The Government believe that including parents who meet these criteria within the entitlement provides an appropriate balance in supporting parents to work where they can do so but also avoiding undue disruption to providers and children due to short periods of parental absence outside the workplace. I hope noble Lords will welcome the Government’s intention to include these circumstances in the eligibility criteria for the extended entitlement, which includes a number of groups specified in Amendment 9 tabled by the noble Baroness, Lady Jones, and the noble Lord, Lord Touhig.

Turning to parents on zero-hours contracts, as mentioned in the Opposition’s Amendment 9, we recognise that the system needs to reflect the variety of working patterns of families across England. I should therefore like to reassure all noble Lords that the contractual position of parents will not determine whether they are eligible for the additional childcare. Parents on zero-hours contracts will be eligible in the same way as anyone else if, on average, they earn at least eight times the minimum wage per week as determined by information held by HMRC on parental earnings.

For parents who are not in work but are undertaking work-related training, in addition to the existing entitlement for three and four year-olds the Government already provide support to help with the costs of childcare to parents in recognised education courses. This includes schemes such as the childcare grant which offers parents support of up to 85% of their childcare costs depending on their household income. We believe that that is already a significant contribution to childcare costs while a parent is studying. Children whose parents are students but who are also in work will qualify for the extended entitlement in the same way as any other parent, as long as they meet the eligibility criteria. I would also like to mention very specifically here that parents on an apprenticeship, who by definition will be working full time, will be able to benefit from the extended entitlement.

As I have already explained, it is our intention that where one parent receives benefits for undertaking caring responsibilities, in the case of couple families they will be regarded as if they were in paid work as long as the other parent is working. This will mean that in such families they will be able to receive the additional entitlement supporting the other parent to remain in work or extend their hours of work. The entitlement is intended to help parents work. In the case of single-parent carers, should they work in addition to their caring responsibilities, they will be entitled to the additional childcare, like other parents.

I should also like to reassure the noble Baroness, Lady Jones, and noble Lord, Lord Touhig, that it is not our intention that children of parents who lose

14 Oct 2015 : Column 276

their job unexpectedly should be disadvantaged. If a parent’s circumstances change their child will remain eligible for the extended free entitlement for a short period. We hope that within this time the parent will be able to regain employment and continue to declare that they expect to meet the criteria that I have just set out. If that is not the case, and after the grace period the parent is clear that they no longer expect to be in paid employment, they would become ineligible. We expect to provide further detail on how this will work in regulations and statutory guidance but a common-sense approach would be for children to keep their place for the remainder of that term.

The Government recognise the importance of volunteering and the role that volunteers play in improving their local community. However, the purpose of the extended entitlement is to help parents go out to work if they want to. As I have explained, entitlement is based on working the equivalent of eight hours, which means that parents who work part time and wish to combine this with some voluntary work will, of course, be able to do so.

Today, and in our policy statement, we have aimed to set out who the Government intend to benefit from the extended entitlement, but I am aware that noble Lords may question why we do not intend to set this level of detail out in primary legislation. As explained, eligibility will broadly align with that for tax-free childcare. The Childcare Payments Act 2014, which established tax-free childcare, sets out general conditions of eligibility, including the need to be in qualifying paid work. However, it is secondary legislation which sets out what is meant by qualifying paid work and when a person is to be regarded as being in such work. Those regulations are obviously highly technical, cross-referring to benefits, allowances and credits established under a number of pieces of primary legislation. Similarly, the approach that the Government have taken in this Bill is to signal in primary legislation that parents will be expected to meet conditions as to paid work in order for their children to qualify.

By taking a power to specify in regulations the circumstances in which a person is to be regarded as in such work, we have also signalled a clear intent to cater for circumstances in which a parent does not meet the paid-work condition, for example because they are temporarily away from the workplace due to sickness or parenting responsibilities, but their child ought nevertheless to qualify. However, we think it is appropriate that the technical detail as to which allowances will mean that a parent can continue to be regarded as being in paid work ought to be left to secondary legislation, and we feel that this strikes the right balance. This will also mirror the approach taken to the entitlement to 15 hours of free childcare for certain eligible two year-olds, where the detail as to which children are eligible is set out in regulations. The secondary legislation for the new entitlement will be laid and approved by each House using the affirmative procedure on their first use, therefore providing the opportunity for debate in both Houses.

I hope noble Lords will recognise that the Government have given careful consideration to the question of eligibility and, through their own amendments, have

14 Oct 2015 : Column 277

addressed the key issues raised in Committee and provided a clear explanation for why some groups mentioned by the noble Baroness and the noble Lord may not be eligible. I therefore urge the noble Lords not to press their amendments and I commend Amendments 7 and 8.

6.15 pm

Baroness Jones of Whitchurch: My Lords, I rise to speak to Amendment 9. Our amendment builds on the Minister’s own previous admission that a more detailed criterion was needed and his pledge to consider the issues again, taking into account what he described as our helpful contributions at Committee stage.

In this spirit, we are again trying to be helpful. Although the Government have made some concessions, we do not believe they have gone far enough, or are clear enough about which parents would qualify for the free hours. Again, we share the concerns of the most recent report of the Delegated Powers and Regulatory Reform Committee, which criticises the Government for relying on the detail of the eligibility criteria being spelled out in regulation rather than on the face of the Bill. It went as far as to say it was “mystified” by this omission.

This is particularly important given that the Government seem to be rushing this Bill through because they want to send an early message to parents that the new entitlement is on its way. However, unless parents are clear on whether or not they will qualify, I rather think that that message will be lost on them. Of course, the current 15 hours of free entitlement applies to all parents, but the additional hours envisaged in this Bill will apply only to parents working a minimum of eight hours a week. I have to say that I do not think that that will go down well among parents with different circumstances sharing the facilities in nurseries. For example, nursery providers and parents will find themselves grappling with definitions and calculations. Some weeks parents will qualify, and other weeks they will not.

As the noble Lord, Lord True, pointed out in Committee:

“At the moment we have a beautifully simple system”.—[Official Report, 1/7/15; col. GC 2099.]

It is easy to administer, and there is a strong case for maintaining the additional free hours as a universal benefit.

However, if we accept the Government’s focus on just helping working parents with the cost of childcare, helping them return to work or to work more hours, then it is important that those new eligibility rules deliver that objective. That is what our amendment seeks to do. The first part of our amendment reflects the Government’s plan that there should be a minimum eight hours worked each week. The second part of our amendment identifies the exceptions to this rule for parents who are in the job market, training for work or unable to work through no fault of their own.

I submit that the categories we have identified are the very people whom the Government are most likely to help back into work by providing additional free childcare. These are the hard-working parents on the bottom rung of the jobs ladder, who will genuinely

14 Oct 2015 : Column 278

struggle with childcare costs. If the Government want to encourage work and extend working hours, these are the very people we need to help. Putting an artificial bar of a minimum of eight hours a week does not really address those concerns.

When the Minister addressed these issues in Committee he argued that there were some discretionary payments that might help parents who study or who were carers. The Minister has repeated those assurances today. However, that is very different from an automatic entitlement to free childcare and, as I have said, there is a strong case for keeping it simple. The Minister also made it clear that parents on flexible contracts, zero-hours contracts or who lose their job unexpectedly should not be disadvantaged. We welcome this commitment and our amendment seeks to enshrine it on the face of the Bill. Our amendment would provide a simple entitlement to categories of parents for whom the Minister has already expressed some sympathy. On that basis, I hope that the Government will feel able to support our amendment.

Baroness Pinnock: Throughout the debate, we have grappled with eligibility criteria. I recognise the fact that the Minister has listened and defined much more clearly the working parents who will qualify under the scheme. However, as the noble Baroness, Lady Jones, has just described, it will be a very complex scheme, as set out in the Bill.

I want to speak to Amendment 10, which we tabled, by first of all thanking the noble Baroness, Lady Evans, for reminding everybody that it was a Liberal Democrat initiative to ensure that 40% of two year-olds from the most deprived and disadvantaged families were for the first time given 20 hours of free childcare a week.

What concerns us here is the huge gap in childcare provision for the majority of parents and their children between the end of paternity or maternity leave and access to free childcare at age three. We want to keep reminding the House and the Government that this gap must be bridged. Despite what the Minister said, it will cost most parents who are in work around £400 a week, which is a significant sum of money, for their one and two year-olds to access full-time childcare. This is somewhat addressed by the tax-free childcare allowance of £1,000-plus a year, but that comes nowhere near addressing the substance of the bills that parents face.

The other issue that I want addressed and have consistently raised is that people who are out of work for more than a year find it increasingly difficult to get back into work. If we can reduce those barriers by providing free childcare, we will be helping them, their families and the state in the long term. That is why I continually raise this point whenever we debate childcare. For those reasons, I want to stress this amendment today. I know that it will not be supported across the House, but I want to keep reminding people about this issue. I shall keep coming back to it, because it is very important for many parents—and for social mobility, which the noble Earl, Lord Listowel, for instance, is concerned about. I hope that in the longer term the Minister will be able to address this gap in childcare provision.

14 Oct 2015 : Column 279

Baroness Evans of Bowes Park: My Lords, I thank the noble Baronesses, Lady Jones and Lady Pinnock, for their very helpful and clear contributions. As I explained earlier, the Government have attempted to set out clearly which children will be eligible for the new entitlement. We are making provision to ensure that parents who are temporarily away from the workplace as a result of other vital duties, such as caring for a new baby or adopted child, will be able to continue to receive their free place, reducing any disruption that short-term absences could cause to providers, and most importantly to the children.

The Government’s commitment is clear. I am afraid that this provision is for working parents of three or four year-olds and that is the entitlement that we intend to keep. The noble Baroness, Lady Jones, asks why we will not define eligibility in primary legislation. As I explained, the details are technical and the nomenclature of the various underlying benefits and allowances may change. By putting this level of detail in regulations, we will be better able to amend eligibility to ensure that we continue to provide places to those whom we want to benefit. We provided substantial details of our intentions in our recent policy statement, which I have put on record in the House today. The House will have the opportunity to debate the detail of the regulations, which will be affirmative.

Amendment 7 agreed.

Amendment 8 agreed.

Amendments 9 to 11 not moved.

The Deputy Speaker (Lord Bichard) (CB): If Amendment 12 is agreed, then Amendments 13 to 16 cannot be called by reason of pre-emption.

Amendment 12 agreed.

Amendments 13 and 14 not moved.

14 Oct 2015 : Column 280

Amendment 15 had been withdrawn from the Marshalled List.

Amendment 16 not moved.

Amendment 17 agreed.

14 Oct 2015 : Column 281

(3) Extended entitlement regulations which impose a duty, or confer a power, on the Commissioners for Her Majesty’s Revenue and Customs, or authorise disclosure of information held by the Commissioners, may only be made with the consent of the Treasury.

(4) In relation to a criminal offence created by virtue of subsection (2)(h), extended entitlement regulations may not provide for a penalty of imprisonment on conviction on indictment greater than imprisonment for a term not exceeding two years (whether or not accompanied by a fine).

(5) If provision is made by virtue of subsection (2)(j)—

(a) the maximum amount of any penalty that may be specified in, or determined in accordance with, the regulations is £3,000;

(b) the regulations must include provision enabling a person on whom a financial penalty is imposed—

(i) to require a review of the imposition of the penalty or its amount by the person who imposed the penalty;

(ii) to appeal against the imposition of the penalty or its amount to the First-tier Tribunal.

(6) The Secretary of State may by regulations substitute a different amount for the amount for the time being specified in subsection (5)(a).

(7) In section 15 of the Childcare Act 2006 (powers of Secretary of State to secure proper performance of English local authorities’ powers and duties under Part 1 of that Act) references to Part 1 of that Act are to be read as including a reference to section 1 and this section.

(8) In this section—

“childcare” has the meaning given by section 18 of the Childcare Act 2006;

“English local authority” means—

(a) a county council in England;

(b) a metropolitan district council;

(c) a non-metropolitan district council for an area for which there is no county council;

(d) a London borough council;

(e) the Common Council of the City of London (in their capacity as a local authority);

(f) the Council of the Isles of Scilly;

“parent” has the same meaning as in section 1;

“qualifying child of working parents” has the meaning given by section 1(2).”

Amendments 19 to 20 (to Amendment 18) not moved.

Baroness Pinnock: I thank the Minister for his very general but principled commitment to greater flexibility and for his willingness to explore the possibilities. However, at this stage I would have hoped for a much clearer definition of expectations in the flexibility that

14 Oct 2015 : Column 282

we are going to allow when providing childcare. For those reasons, I would like to test the opinion of the House.

6.26 pm

Division on Amendment 20A

Contents 195; Not-Contents 169.

Amendment 20A agreed.

Division No.  2

CONTENTS

Adams of Craigielea, B.

Addington, L.

Alton of Liverpool, L.

Anderson of Swansea, L.

Andrews, B.

Armstrong of Hill Top, B.

Bach, L.

Bakewell of Hardington Mandeville, B.

Barker, B.

Bassam of Brighton, L.

Beecham, L.

Berkeley, L.

Bichard, L.

Blackstone, B.

Blunkett, L.

Boateng, L.

Boothroyd, B.

Brooke of Alverthorpe, L.

Brookman, L.

Browne of Belmont, L.

Burnett, L.

Campbell-Savours, L.

Carlile of Berriew, L.

Carter of Coles, L.

Cashman, L.

Chidgey, L.

Clark of Windermere, L.

Clarke of Hampstead, L.

Clement-Jones, L.

Collins of Highbury, L.

Corston, B.

Cotter, L.

Crawley, B.

Davidson of Glen Clova, L.

Davies of Oldham, L.

Dholakia, L.

Donaghy, B.

Doocey, B.

Dubs, L.

Dundee, E.

Dykes, L.

Elder, L.

Evans of Temple Guiting, L.

Falkland, V.

Falkner of Margravine, B.

Farrington of Ribbleton, B.

Foster of Bishop Auckland, L.

Foulkes of Cumnock, L.

Gale, B.

Garden of Frognal, B.

German, L.

Giddens, L.

Glasman, L.

Goddard of Stockport, L.

Golding, B.

Gould of Potternewton, B.

Grantchester, L.

Grender, B.

Grocott, L.

Hameed, L.

Hamwee, B.

Hanworth, V.

Harris of Haringey, L.

Harris of Richmond, B.

Harrison, L.

Hart of Chilton, L.

Haughey, L.

Hay of Ballyore, L.

Healy of Primrose Hill, B.

Henig, B.

Hilton of Eggardon, B.

Hollick, L.

Hollis of Heigham, B.

Howarth of Newport, L.

Howells of St Davids, B.

Hoyle, L.

Hughes of Woodside, L.

Humphreys, B. [Teller]

Hussein-Ece, B.

Irvine of Lairg, L.

Jay of Paddington, B.

Jolly, B.

Jones, L.

Jones of Cheltenham, L.

Jones of Whitchurch, B.

Jordan, L.

Judd, L.

Kennedy of Southwark, L.

Kinnock, L.

Kinnock of Holyhead, B.

Kirkhill, L.

Kirkwood of Kirkhope, L.

Knight of Weymouth, L.

Kramer, B.

Lawrence of Clarendon, B.

Lea of Crondall, L.

Lee of Trafford, L.

Lester of Herne Hill, L.

Liddell of Coatdyke, B.

Lister of Burtersett, B.

Loomba, L.

McAvoy, L.

McDonagh, B.

Macdonald of Tradeston, L.

McFall of Alcluith, L.

McIntosh of Hudnall, B.

MacKenzie of Culkein, L.

McKenzie of Luton, L.

Maclennan of Rogart, L.

McNally, L.

Maddock, B.

Mallalieu, B.

Mandelson, L.

Manzoor, B.

Marks of Henley-on-Thames, L.

Masham of Ilton, B.

Massey of Darwen, B.

Maxton, L.

14 Oct 2015 : Column 283

Mendelsohn, L.

Mitchell, L.

Monks, L.

Morgan, L.

Morgan of Ely, B.

Morris of Handsworth, L.

Nicholson of Winterbourne, B.

Northover, B.

Nye, B.

O'Neill of Clackmannan, L.

Paddick, L.

Parekh, L.

Parminter, B.

Patel of Blackburn, L.

Patel of Bradford, L.

Pendry, L.

Pinnock, B.

Pitkeathley, B.

Ponsonby of Shulbrede, L.

Prescott, L.

Purvis of Tweed, L.

Quin, B.

Radice, L.

Ramsay of Cartvale, B.

Randerson, B.

Rea, L.

Redesdale, L.

Reid of Cardowan, L.

Rennard, L.

Richard, L.

Roberts of Llandudno, L.

Robertson of Port Ellen, L.

Rooker, L.

Rosser, L.

Rowlands, L.

Royall of Blaisdon, B.

Sawyer, L.

Scriven, L.

Sharkey, L.

Sharp of Guildford, B.

Sherlock, B.

Shutt of Greetland, L.

Simon, V.

Smith of Basildon, B.

Smith of Gilmorehill, B.

Smith of Newnham, B.

Soley, L.

Stephen, L.

Stevenson of Balmacara, L.

Stoddart of Swindon, L.

Stone of Blackheath, L.

Storey, L. [Teller]

Strasburger, L.

Symons of Vernham Dean, B.

Taverne, L.

Taylor of Blackburn, L.

Taylor of Bolton, B.

Taylor of Goss Moor, L.

Thomas of Winchester, B.

Thornton, B.

Tomlinson, L.

Tope, L.

Touhig, L.

Tunnicliffe, L.

Tyler, L.

Tyler of Enfield, B.

Uddin, B.

Wall of New Barnet, B.

Wallace of Saltaire, L.

Wallace of Tankerness, L.

Watson of Invergowrie, L.

West of Spithead, L.

Wheeler, B.

Whitaker, B.

Whitty, L.

Wills, L.

Wood of Anfield, L.

NOT CONTENTS

Aberdare, L.

Ahmad of Wimbledon, L.

Altmann, B.

Anelay of St Johns, B.

Arran, E.

Ashton of Hyde, L.

Attlee, E.

Baker of Dorking, L.

Bates, L.

Berridge, B.

Black of Brentwood, L.

Blencathra, L.

Borwick, L.

Bourne of Aberystwyth, L.

Bowness, L.

Brabazon of Tara, L.

Bridgeman, V.

Bridges of Headley, L.

Brougham and Vaux, L.

Browning, B.

Byford, B.

Caithness, E.

Carrington of Fulham, L.

Cathcart, E.

Cavendish of Furness, L.

Chadlington, L.

Chalker of Wallasey, B.

Chisholm of Owlpen, B.

Coe, L.

Colville of Culross, V.

Colwyn, L.

Cooper of Windrush, L.

Cope of Berkeley, L.

Cormack, L.

Courtown, E.

Craigavon, V.

Crickhowell, L.

De Mauley, L.

Deben, L.

Denham, L.

Dixon-Smith, L.

Dunlop, L.

Eaton, B.

Eccles, V.

Eccles of Moulton, B.

Elton, L.

Empey, L.

Evans of Bowes Park, B.

Faulks, L.

Feldman of Elstree, L.

Fellowes, L.

Fink, L.

Finkelstein, L.

Fookes, B.

Forsyth of Drumlean, L.

Framlingham, L.

Freeman, L.

Freud, L.

Gardiner of Kimble, L. [Teller]

Garel-Jones, L.

Geddes, L.

Glenarthur, L.

Gold, L.

Goldie, B.

Goodlad, L.

Goschen, V.

Harding of Winscombe, B.

Harris of Peckham, L.

Hayward, L.

Helic, B.

Higgins, L.

14 Oct 2015 : Column 284

Holmes of Richmond, L.

Hooper, B.

Horam, L.

Howard of Rising, L.

Howarth of Breckland, B.

Howe, E.

Howell of Guildford, L.

Hunt of Wirral, L.

Inglewood, L.

James of Blackheath, L.

Jenkin of Kennington, B.

Jopling, L.

Kakkar, L.

Keen of Elie, L.

Kilclooney, L.

Kinnoull, E.

Kirkham, L.

Lamont of Lerwick, L.

Lang of Monkton, L.

Leigh of Hurley, L.

Lexden, L.

Lindsay, E.

Lingfield, L.

Listowel, E.

Low of Dalston, L.

Lucas, L.

Lyell, L.

McColl of Dulwich, L.

MacGregor of Pulham Market, L.

Mackay of Clashfern, L.

MacLaurin of Knebworth, L.

Maginnis of Drumglass, L.

Mancroft, L.

Marland, L.

Marlesford, L.

Mawhinney, L.

Mawson, L.

Moore of Lower Marsh, L.

Morris of Bolton, B.

Moynihan, L.

Naseby, L.

Nash, L.

Neville-Jones, B.

Neville-Rolfe, B.

Newlove, B.

Northbrook, L.

Norton of Louth, L.

O'Cathain, B.

O'Neill of Bengarve, B.

O'Neill of Gatley, L.

Perry of Southwark, B.

Popat, L.

Prior of Brampton, L.

Ribeiro, L.

Risby, L.

Rotherwick, L.

Rowe-Beddoe, L.

Ryder of Wensum, L.

St John of Bletso, L.

Sanderson of Bowden, L.

Sandwich, E.

Seccombe, B.

Selborne, E.

Selkirk of Douglas, L.

Selsdon, L.

Shackleton of Belgravia, B.

Sharples, B.

Shephard of Northwold, B.

Sherbourne of Didsbury, L.

Shields, B.

Shrewsbury, E.

Smith of Hindhead, L.

Spicer, L.

Stedman-Scott, B.

Stowell of Beeston, B.

Strathclyde, L.

Suri, L.

Sutherland of Houndwood, L.

Taylor of Holbeach, L. [Teller]

Taylor of Warwick, L.

Tebbit, L.

Thomas of Swynnerton, L.

Trees, L.

Trenchard, V.

Trimble, L.

True, L.

Tugendhat, L.

Ullswater, V.

Verma, B.

Wakeham, L.

Walpole, L.

Wasserman, L.

Wheatcroft, B.

Whitby, L.

Williams of Trafford, B.

Wolfson of Aspley Guise, L.

Young of Cookham, L.

Younger of Leckie, V.

6.38 pm

Amendment 21 (to Amendment 18) not moved.

Amendment 18, as amended, agreed.

14 Oct 2015 : Column 285

“(4C) For the purposes of this Part, a duty imposed on a local authority in England under section (Discharging the section 1(1) duty) of the Childcare Act 2015 (duties in connection with Secretary of State’s duty to secure 30 hours free childcare for working parents) is also to be treated as an education function of the authority.”;

(b) in section 47ZA (free of charge early years provision outside a maintained school: budgetary framework: England), in subsection (3), for paragraph (a) (but not the “and” after it) substitute—

“(a) for the purpose of the discharge of—

(i) the authority’s duty under section 7 of the Childcare Act 2006, or

(ii) a duty imposed on the authority under section (Discharging the section 1(1) duty) of the Childcare Act 2015,”.”

Baroness Evans of Bowes Park: My Lords, this new clause makes amendments to existing provisions of primary legislation that are consequential on the new duty on the Secretary of State under Clause 1 of this Bill and the Secretary of State’s powers to make regulations for the purpose of discharging that duty.

The proposed amendment to Section 99 of the Childcare Act 2006 would enable the Secretary of State to require childcare providers who deliver the extended entitlement to supply basic information about children receiving free childcare to local authorities and to the Secretary of State. Since 2008, childcare providers who deliver the current early education entitlement have been required to provide individual child-level data to local authorities and the Secretary of State through the school census and the early years census. The information collected enables the department to monitor take-up of free places and measure the success of the early education entitlement. Take-up rates are then published annually.

Take-up rates are key to ensuring that funding for the early entitlement is properly allocated to local authorities and, in turn, to providers. This also enables us to identify any children who are accessing more childcare than they are entitled to, which is vital in order to guard against abuse of the system. We wish to do the same for the new extended entitlement. Providing basic information about children in their care, such as their name, date of birth and the number of government-funded hours they take up, does not place an undue administrative burden on providers, as it is information they hold as a matter of course.

I should also like reassure noble Lords that robust safeguards are in place that prohibit publication of the data in a form that names or identifies individual children. The collection and use of data by the Secretary of State, local authorities and other specified persons is, in any case, also bound by the provisions of the Data Protection Act. I am sure that noble Lords agree that making provision to enable local authorities and the Government to collect data on children accessing free childcare is key to enabling us to monitor the successful delivery of the entitlement.

Secondly, I turn to the amendment to the School Standards and Framework Act. That Act, together with regulations made under it, sets the legal and budgetary framework for the allocation of financial assistance by local authorities to maintained schools,

14 Oct 2015 : Column 286

and to private, voluntary and independent providers of free early years provision in their area. This amendment extends that legal framework to financial assistance provided to settings delivering the new entitlement to 30 hours of free childcare for working parents.

I hope that noble Lords agree that it is important that we monitor take-up of the extended entitlement and that the existing legal framework for the allocation of funding by local authorities to childcare providers is updated to reflect this new entitlement. I urge noble Lords to accept this amendment, and I beg to move.

The Earl of Listowel: My Lords, will the data give information about the number of homeless families that are taking up the entitlement, for instance, or about the number of families with children in income poverty taking up the entitlement? If it is helpful to her I am happy for the Minister to write to me.

Baroness Evans of Bowes Park: I will happily write to the noble Earl.

Amendment 22 agreed.

Amendment 23 not moved.

Baroness Pinnock: In moving Amendment 24, I will speak also to Amendment 25. I have three things to say, as there are three areas that these amendments cover.

First, we know that capital funding is a big issue for the National Association of Head Teachers in particular. The association is concerned that, with growing numbers in the primary phase and the early years phase per se, there will be inadequate buildings expansion to address the additional 15 hours’ free childcare. Local government associations are also pressing the Government to commit to a capital fund for the expansion of buildings to ensure that the childcare can be accommodated. That is one reason why we tabled the amendment: to ensure that the Minister considers this issue when he makes these decisions.

6.45 pm

Secondly, I want to focus on children in deprived areas. I know that the Government will respond by saying that there is an early years pupil premium. Indeed there is. It is worth £300 a year. That is 25p for

14 Oct 2015 : Column 287

every hour that a child is in full-time childcare. This is not really sufficient to make a significant difference to those children. On top of that, increasingly, the direct schools grant is not focusing on deprivation factors. Together, those two elements have resulted in us tabling the amendment, in order to draw the Government’s attention to the importance of considering this issue as a matter of urgency when funding decisions are made.

My final point, raised earlier in the debate, is about cross-subsidisation. I will repeat the figures I was given—on Facebook, as it happens. Some parents are paying a rate of £5 an hour in the free element of their childcare. That rises to £8.53 when parents are paying for childcare outside the free hours. That shows the difference between the cost applied to free childcare and the figure that the provider needs in order to have a sustainable business. For those reasons, I have tabled these two amendments. I beg to move.

Baroness Jones of Whitchurch: My Lords, I support these amendments. In essence they follow on from our earlier debate about funding. The noble Baroness has made a compelling case for the payment schemes being fully funded. This is important for providers and local authorities, who do not want to discover that once again, they are being expected to cross-subsidise the free places from other budgets or income streams. It is particularly important for children living in deprived areas, for whom additional funding from another pot simply might not be available.

We also support the strong case being made for an element of capital funding being included in the local authority grant. If part of the Government’s strategy is to increase demand and bring new people into the jobs market, rather than simply provide a higher subsidy for those already in work, extra capacity will need to be found. We cannot rely on the market to fill this gap, particularly in the poorer areas, so local authorities will need to step in and help.

The last thing that we want as a result of this Bill is for the gap in provision between the more affluent areas and deprived ones to widen, but if we are not careful that could be the consequence if the places are not fully funded. We support these amendments and the certainty that will arise from the commitment to funding being enshrined in the Bill.

Baroness Evans of Bowes Park: My Lords, I would like to speak to Amendments 24 and 25, tabled by the noble Baronesses, Lady Pinnock and Lady Tyler, to which the noble Baroness, Lady Jones, has just referred, and to which the noble Baronesses, Lady Andrews and Lady Howarth, referred earlier in relation to cross-subsidy.

On Amendment 24, I thank the noble Baronesses for highlighting the need for the rate paid to be sufficient for providers delivering the extended entitlement, and for bringing to my attention the need to secure provision for children in deprived areas. I understand the concerns they are seeking to address through these amendments, and the Minister mentioned earlier that we share the aim of getting the funding for the entitlement right.

14 Oct 2015 : Column 288

We are clear that this funding must be sufficient to ensure that providers are funded adequately to be able to deliver the additional requirements set out in the Bill.

We have listened to providers’ concerns that increasing Government-funded hours will limit their ability to cross-subsidise from parent-funded hours, and that delivering at current rates may not be sustainable. That is why the Prime Minister has committed to increase the average hourly funded rate paid to providers. As was mentioned earlier, we are the only party to have made this commitment. We have already committed £840 million of new funding to deliver the extended entitlement, and that is before we deliver on our pledge to increase the hourly funding rate.

My noble friend Lord Nash has spoken at length about the review on the cost of providing childcare, the purpose of which is to provide a robust analytical underpinning for a funding rate that is fair and sustainable for providers and delivers value for money to the taxpayer. I confirm that the review will include in its consideration the needs of children in deprived areas. I also assure noble Lords that the Government understand the importance of early years education for children from disadvantaged households.

We know that high-quality early education can lead to higher attainment later but there is a persistent gap between children eligible for free school meals and their peers in the proportion achieving a good level of development in the early years foundation stage profile. This is why we introduced the early years pupil premium in April this year, which provides extra funding to early years settings for each three or four year-old child from a disadvantaged household. We have estimated that there will be around 170,000 children eligible for this extra support in 2015-16. We expect to receive the first data on take-up of the early years pupil premium by the end of this year and will consider these very carefully and take them into account when we develop future policy.

Turning to Amendment 25, the Government aim to deliver a quality free childcare entitlement, with capacity created cost-effectively without driving up costs to parents. The majority of working families with three and four year-olds already use more than 15 hours of childcare. This means that many children will already be in a childcare place and will not require a new one. Rather, the new extended entitlement will pay for the additional hours parents are already purchasing from an early years setting themselves, helping working families with the cost of childcare.

There is natural growth in the childcare system but we can, and should, encourage new providers to enter the market or existing providers to expand. Collaborative arrangements across different types of providers and increased flexibility for providers are important elements of this. That is why, for example, under the Small Business, Enterprise and Employment Act, childminders will be able to provide childcare on non-domestic premises.

The Government have already made a £100 million investment of capital in early years to support the expansion of provision for two year-olds. We believe there is existing capacity in the system to help deliver

14 Oct 2015 : Column 289

the new entitlement, and we are continuing to talk to local authorities to increase our understanding and evidence of where this is. The Government are committed to funding the extension of the entitlement at a level that ensures choice and flexibility for parents, is sustainable for providers, and is fair to the taxpayer. Decisions on the level of funding, including any capital, will be made in the forthcoming spending review. I therefore urge the noble Baroness to withdraw her amendment.

Baroness Pinnock: I thank the Minister for her commitment to the capital element and to focusing on areas of deprivation and disadvantaged families in future deliberations. With that in mind, I beg leave to withdraw the amendment.

Amendment 24 withdrawn.

Amendment 25 not moved.

Clause 2: Supplementary provision about regulations under section 1

Lord Nash: My Lords, this group of amendments concerns the regulations made under the Bill, which will be key to setting out the detail of the new entitlement, including who will be eligible and how it will be delivered. Therefore, I understand noble Lords’ concerns about ensuring that they have a proper opportunity to scrutinise this detail.

There was much interest in the regulations in our earlier debates in this House and in the report by the Delegated Powers and Regulatory Reform Committee. The committee concluded that the scope of the delegations and powers under Clause 1 as drafted were too wide. Given the importance of secondary legislation to the Bill, I am in complete agreement with noble Lords and with the committee’s report that it would be appropriate for regulations to be approved by a debate in both Houses. That is why I have brought forward these amendments, which would require regulations made under Clause 1 and extended entitlement regulations to be laid and approved by each House using the affirmative procedure. I hope this will reassure noble Lords that we have listened. I hope the Government’s amendments will be welcomed.

Amendment 27, tabled by the noble Baroness, Lady Jones, would ensure that a statutory instrument containing regulations in exercise of any power in the Bill would not be made unless a draft of the instrument had been laid and approved by each House; in other words, it would subject regulations to the affirmative procedure each time the regulation-making power was exercised. We believe it is right that initially we should deal with the regulations under the affirmative procedure, rather than the negative procedure as originally planned. However, we do not believe it is necessary to make them affirmative each time.

14 Oct 2015 : Column 290

We need to strike the right balance between the mechanics of the affirmative process—for example, the need to find time in the parliamentary timetable for debates in both Houses, no matter how small the change—and the ability of government to respond efficiently and effectively to support delivery of the new entitlement, should this be necessary. That is why the government amendments in this group envisage that regulations made under Clause 1 and regulations made for the purpose of discharging the Secretary of State’s duty will be subject to a debate the first time the powers are exercised but that subsequent regulations made under the Bill would be subject to the negative resolution procedure.

The exception to this would be in any instances where regulations seek to amend or repeal primary legislation, or in the case of regulations seeking to update the maximum level of any financial penalty set out in the Bill, which would be subject to the affirmative procedure. This follows the precedents of parliamentary scrutiny adopted in childcare legislation or comparable education legislation. The regulations that underpin the current Section 7 entitlement have been subject to the negative procedure since they were introduced in 2008. These have been amended only four times, and each time the changes were subject to a public consultation.

We believe that our approach is the right one. As noble Lords have already heard, we have made great progress since Committee to narrow the scope and clarify the detail of what we will include in the regulations. I also reassure noble Lords that feedback from parents, providers and employers will be taken into account in the development of the draft regulations, and we will wish to draw on the expertise of noble Lords. Furthermore, we have committed to providing a full impact assessment on the extent of the free entitlement, which will be published when we undertake a formal public consultation on the draft regulations in 2016. Following the consultation, we will lay the draft regulations before the House for a full debate before they can be approved and added to the statute book.

I hope noble Lords agree that by the time they are laid, these regulations will have undergone a significant amount of close scrutiny. Therefore, I am confident that we will be able to present a set of regulations to the House that are fair and workable and remain true to the spirit of the Government’s commitment to support and reward thousands of hard-working families. I beg to move.

Lord Touhig: My Lords, I regret very much having to put Amendment 27 before the House but, frankly, the Government leave us no choice. We have seen throughout the passage of the Bill the cavalier attitude the Government have taken—not by the Ministers who have represented the Government in this House, I hasten to add, but by the Government as a whole. In support of that assertion, I quote from the 2nd Report of the Delegated Powers and Regulatory Reform Committee, published on 26 June, which says at paragraph 10:

“We note that the Minister said that ‘the introduction of the Bill, with a strong duty on the Secretary of State, sends a clear message to parents and providers about the Government’s commitment’. That is not, in our judgment, a proper use of legislation: the purpose of an Act is to change the law, not to ‘send a message’”.

14 Oct 2015 : Column 291

Earlier, in paragraph 8, the committee says:

“In our view, the Government’s stated approach to delegation is flawed. While the Bill may contain a legislative framework, it contains virtually nothing of substance beyond the vague ‘mission statement’”.

Finally, in paragraph 9 of the report, the committee states that:

“We do not accept the Government’s attempt to dignify their approach to delegation by referring to a need to consult. We of course acknowledge the need for consultation as a precursor to the formation of policy; but this should in our view have followed the well-established sequence of a Green Paper setting out proposals, followed by a White Paper containing the Government’s legislative intentions, and finally the presentation of a Bill”.

There we have it—that spells out quite clearly how the Government should be presenting legislation to Parliament.

7 pm

Since then, we have had some concessions, but not enough to persuade us on this side not to table Amendment 27. We have argued that all the regulations made on the Bill should be subject to affirmative resolution of both Houses of Parliament. The Government’s response is to say that the initial regulations made under Clause 1 would be subject to an affirmative resolution but not the rest. Why is this? I do not think the Minister has given us a thoroughly acceptable answer this evening. In its 8th report, published yesterday, the committee points out that,

“conditions could subsequently be altered—and conceivably removed—by negative procedure regulations”.

It also says:

“The first-time affirmative procedure that the Government now propose for regulations under clause 1 would mean that the initial (affirmative) regulations would include the eligibility conditions; but conditions could subsequently be altered—and conceivably removed—by negative procedure regulations. We do not regard that as satisfactory, and, in the absence of provision about eligibility on the face of the Bill, we recommend that regulations under clause 1(2)(d) and (2B) in particular should require the affirmative procedure whenever made”.

That is a report of distinguished Members from all sides of this House and we should take note of it. I am not alone in believing that this is a damning indictment of the structure of the Bill, handed down by a distinguished committee. I invite the Minister, in his reply, to state quite clearly that the Government will look further at this and come back, at Third Reading, with an amendment to make all the regulations in the Bill subject to an affirmative resolution. That is righting a wrong and I hope the Government will do it.

Baroness Andrews: My Lords, I support my noble friend on this point. If the Delegated Powers Committee had believed that first-time affirmative action was sufficient it would certainly have said so, because its mark as a committee is to be proportionate. There is a very good reason why it has said, so strongly, that any changes must be done through the affirmative procedure each time. Perhaps I may use the Government’s arguments against them. The Minister previously argued that these definitions of eligibility were technical, but they are not. The point about these regulations is that the definitions represent the substance of the Bill: who is going to be eligible for these extended childcare provisions. They are a serious aspect of the Bill and should be on

14 Oct 2015 : Column 292

the face of it. The Minister argued that there may be a need to change the definitions and if they are in secondary legislation they can be changed more easily. If that is the case, the changes to the definitions are very serious indeed. As the committee says, they may be made to remove or add new categories. The Government know that they are dealing with a febrile and dynamic situation with a complex aspect of policy and they may well require to change these regulations. We are dealing with massive uncertainties here. The Government would be well advised—I say this in all sincerity—to follow the advice of the committee in this instance and ensure that each change in the regulations is properly debated in this House by way of an affirmative resolution

Lord Sutherland of Houndwood: My Lords, I do not often listen to myself in debates but I did so earlier on and began to wonder if I was sitting on the right set of Benches, on a Cross Bench. However, I am now reassured that I am, on two grounds. First, I welcome the report of the Delegated Powers Committee very warmly indeed: somewhat more so than the Minister. Secondly, I support the amendment on a belt-and-braces basis. The point has just been made that there are many uncertainties here and we need to be reassured that these will be resolved on the Floor of this House.

Lord Mackay of Clashfern: My Lords, I have one comment on the report of the Delegated Powers Committee. If all Bills had to be preceded by a Green Paper and a White Paper, there would be a long interval after a general election before there would be any legislation at all. Some people would welcome that but, on the other hand, those who are anxious to fulfil their commitments might not wish to wait that long.

Lord Nash: The Government recognise and understand the expressed views and wishes of the House and the Delegated Powers Committee to be able to debate the regulations in more detail. Our amendments will provide a higher degree of parliamentary scrutiny beyond the original intention. Furthermore, the department will continue to consult on any material changes to the regulations once they have been approved and laid under the negative procedure. We recognise the importance of seeking the views of parents, local authorities and providers. Each time the regulations that underpin the current entitlement have been amended, which is only four times, they have been subject to a public consultation. The current entitlement is subject to a negative procedure and we are not persuaded that this situation is sufficiently different to warrant finding parliamentary time for changes which may be minor. The department will continue to follow this good practice and will consult on any material changes to regulations made under Section 1 and regulations made for the purposes of discharging the Secretary of State’s duty under what will become Section 2. Therefore, in the Government’s view, it would not be necessary to include this type of direction on the face of the Bill. I hope noble Lords will be reassured by my explanation that we have listened to their concerns and taken them seriously. I therefore urge the noble Baroness not to press Amendment 27, and for noble Lords to accept government Amendments 26, 28 and 29.

Amendment 26 agreed.

14 Oct 2015 : Column 293

Lord Touhig: My Lords, I beg to move and wish to test the opinion of the House.

The Deputy Speaker (Viscount Ullswater) (Con): My Lords, I must inform the House that if this amendment is agreed to I will not be able to call Amendments 28 and 29.

7.07 pm

Division on Amendment 27

Contents 159; Not-Contents 137.

Amendment 27 agreed.

Division No.  3

CONTENTS

Adams of Craigielea, B.

Addington, L.

Adonis, L.

Andrews, B.

Armstrong of Hill Top, B.

Bach, L.

Bakewell of Hardington Mandeville, B.

Barker, B.

Bassam of Brighton, L. [Teller]

Beecham, L.

Berkeley, L.

Blackstone, B.

Blunkett, L.

Brooke of Alverthorpe, L.

Brookman, L.

Browne of Belmont, L.

Carlile of Berriew, L.

Cashman, L.

Chidgey, L.

Clark of Windermere, L.

Colville of Culross, V.

Cotter, L.

Crawley, B.

Davies of Oldham, L.

Davies of Stamford, L.

Dholakia, L.

Donaghy, B.

Dubs, L.

Evans of Temple Guiting, L.

Falkland, V.

Falkner of Margravine, B.

Farrington of Ribbleton, B.

Foster of Bishop Auckland, L.

Foulkes of Cumnock, L.

Gale, B.

Glasman, L.

Goddard of Stockport, L.

Golding, B.

Gould of Potternewton, B.

Grantchester, L.

Grender, B.

Grocott, L.

Hamwee, B.

Hanworth, V.

Harris of Haringey, L.

Harris of Richmond, B.

Harrison, L.

Hart of Chilton, L.

Hay of Ballyore, L.

Hayman, B.

Healy of Primrose Hill, B.

Henig, B.

Hollis of Heigham, B.

Howarth of Newport, L.

Howells of St Davids, B.

Hoyle, L.

Hussain, L.

Hussein-Ece, B.

Irvine of Lairg, L.

Jay of Paddington, B.

Jolly, B.

Jones, L.

Jones of Whitchurch, B.

Jordan, L.

Judd, L.

Kennedy of Cradley, B.

Kennedy of Southwark, L.

Kestenbaum, L.

Kinnock, L.

Kinnock of Holyhead, B.

Kirkhill, L.

Kirkwood of Kirkhope, L.

Kramer, B.

Lawrence of Clarendon, B.

Lea of Crondall, L.

Lee of Trafford, L.

Lipsey, L.

Lister of Burtersett, B.

Listowel, E.

Loomba, L.

14 Oct 2015 : Column 294

Low of Dalston, L.

McAvoy, L. [Teller]

McDonagh, B.

McFall of Alcluith, L.

McIntosh of Hudnall, B.

MacKenzie of Culkein, L.

McKenzie of Luton, L.

Maclennan of Rogart, L.

McNally, L.

Maddock, B.

Mallalieu, B.

Manzoor, B.

Marks of Henley-on-Thames, L.

Massey of Darwen, B.

Maxton, L.

Mendelsohn, L.

Monks, L.

Morgan, L.

Newby, L.

Northover, B.

Nye, B.

O'Neill of Bengarve, B.

O'Neill of Clackmannan, L.

Paddick, L.

Parekh, L.

Patel of Bradford, L.

Pendry, L.

Pinnock, B.

Pitkeathley, B.

Ponsonby of Shulbrede, L.

Prescott, L.

Purvis of Tweed, L.

Ramsay of Cartvale, B.

Randerson, B.

Reid of Cardowan, L.

Richard, L.

Roberts of Llandudno, L.

Rooker, L.

Rosser, L.

Rowlands, L.

Royall of Blaisdon, B.

Scott of Needham Market, B.

Scriven, L.

Sharkey, L.

Sharp of Guildford, B.

Sherlock, B.

Shutt of Greetland, L.

Simon, V.

Smith of Basildon, B.

Smith of Gilmorehill, B.

Smith of Newnham, B.

Soley, L.

Stephen, L.

Stone of Blackheath, L.

Storey, L.

Sutherland of Houndwood, L.

Symons of Vernham Dean, B.

Taverne, L.

Taylor of Bolton, B.

Taylor of Goss Moor, L.

Thomas of Winchester, B.

Thornton, B.

Tomlinson, L.

Tope, L.

Touhig, L.

Tunnicliffe, L.

Tyler, L.

Tyler of Enfield, B.

Uddin, B.

Wallace of Tankerness, L.

Walpole, L.

Watson of Invergowrie, L.

Wheeler, B.

Whitaker, B.

Whitty, L.

Wigley, L.

Winston, L.

Wood of Anfield, L.

Young of Hornsey, B.

NOT CONTENTS

Aberdare, L.

Ahmad of Wimbledon, L.

Altmann, B.

Anelay of St Johns, B.

Ashton of Hyde, L.

Baker of Dorking, L.

Bates, L.

Berridge, B.

Best, L.

Black of Brentwood, L.

Blencathra, L.

Borwick, L.

Bourne of Aberystwyth, L.

Brabazon of Tara, L.

Bridgeman, V.

Bridges of Headley, L.

Brougham and Vaux, L.

Browning, B.

Byford, B.

Carrington of Fulham, L.

Cathcart, E.

Cavendish of Furness, L.

Chadlington, L.

Chalker of Wallasey, B.

Chisholm of Owlpen, B.

Coe, L.

Cooper of Windrush, L.

Cope of Berkeley, L.

Cormack, L.

Courtown, E.

Crickhowell, L.

De Mauley, L.

Denham, L.

Dixon-Smith, L.

Dunlop, L.

Eaton, B.

Eccles, V.

Eccles of Moulton, B.

Elton, L.

Empey, L.

Evans of Bowes Park, B.

Faulks, L.

Feldman of Elstree, L.

Fink, L.

Finkelstein, L.

Flight, L.

Fookes, B.

Forsyth of Drumlean, L.

Framlingham, L.

Freeman, L.

Freud, L.

Gardiner of Kimble, L. [Teller]

Garel-Jones, L.

Geddes, L.

Glenarthur, L.

Glendonbrook, L.

Gold, L.

Goldie, B.

Goodlad, L.

Goschen, V.

Harding of Winscombe, B.

Harris of Peckham, L.

Hayward, L.

Helic, B.

Higgins, L.

Holmes of Richmond, L.

Horam, L.

Howard of Rising, L.

Howe, E.

14 Oct 2015 : Column 295

Inglewood, L.

James of Blackheath, L.

Jenkin of Kennington, B.

Jopling, L.

Kilclooney, L.

King of Bridgwater, L.

Kinnoull, E.

Kirkham, L.

Lamont of Lerwick, L.

Lang of Monkton, L.

Leigh of Hurley, L.

Lexden, L.

Lindsay, E.

Lingfield, L.

Lyell, L.

McColl of Dulwich, L.

MacGregor of Pulham Market, L.

Mackay of Clashfern, L.

Mancroft, L.

Marlesford, L.

Mawhinney, L.

Mawson, L.

Moore of Lower Marsh, L.

Moynihan, L.

Nash, L.

Neville-Jones, B.

Neville-Rolfe, B.

Newlove, B.

Norton of Louth, L.

O'Cathain, B.

O'Neill of Gatley, L.

Pannick, L.

Perry of Southwark, B.

Prior of Brampton, L.

Ribeiro, L.

Rogan, L.

Ryder of Wensum, L.

Seccombe, B.

Selborne, E.

Selkirk of Douglas, L.

Selsdon, L.

Sharples, B.

Shephard of Northwold, B.

Sherbourne of Didsbury, L.

Shields, B.

Shrewsbury, E.

Smith of Hindhead, L.

Spicer, L.

Stedman-Scott, B.

Stowell of Beeston, B.

Strathclyde, L.

Suri, L.

Taylor of Holbeach, L. [Teller]

Tebbit, L.

Trees, L.

Trimble, L.

True, L.

Ullswater, V.

Verma, B.

Wakeham, L.

Wasserman, L.

Wheatcroft, B.

Whitby, L.

Williams of Trafford, B.

Wolfson of Aspley Guise, L.

Woolf, L.

Young of Cookham, L.

Younger of Leckie, V.

7.18 pm

Amendments 28 and 29 not moved.

Clause 5: Commencement

Amendments 30 and 31 agreed.

Amendment 32 not moved.

Prosecution of Offences Act 1985 (Criminal Courts Charge) Regulations 2015

Motion to Regret

7.19 pm

Moved by Lord Beecham

That this House regrets that the Prosecution of Offences Act 1985 (Criminal Courts Charge) Regulations 2015 undermine the principle of judicial discretion, and add an artificial inducement to plead guilty; and further regrets that the Regulations were laid at a time that severely limited Parliamentary oversight, as well as making claims for savings that cannot be substantiated (SI 2015/796).

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Relevant document: 1st Report from the Secondary Legislation Scrutiny Committee

Lord Beecham (Lab): My Lords, I refer to my interests as an unpaid consultant with the firm with which I was formerly a senior partner.

A few months ago a 32 year-old woman, Louise Sewell, stole a pack of four Mars bars worth 75 pence from a shop in Kidderminster. She was undergoing a benefits sanction and had not eaten for two days. She pleaded guilty and was ordered to pay a criminal courts charge of £150. A man in Newbury who lives in a tent and stole a £2.99 bottle of wine from a supermarket was subjected to the same charge, but was not required to pay the criminal courts charge in the light of his limited means. I am grateful to the Law Society and the Howard League respectively for supplying details of these and other cases—of which there are many—to my old firm and to a magistrate friend who has served for a long time on the Bench and has much experience chairing the Bench in his area.

A client of my old firm who was addicted to legal highs and is on probation received a summons for littering and was convicted in his absence. The court wished to impose a small penalty or conditional discharge. Either of those would have required the imposition of the £150 court charge. The court decided to order an absolute discharge and thereby avoid the financial penalty. Faced with a similar situation, my magistrate friend presided over a case of minor criminal damage where the fine would have been around £75, costs £85, and victim compensation £20, to which would have been added a criminal charge order of £150. The defendant’s income consists of £115 in benefits per fortnight. The court decided to give him a discharge, which meant not only that the courts charge was not payable but that no victim compensation could be ordered.

These cases and many like them proceed from the criminal courts charge regulations, which are the subject of this Motion, which among the many dubious legacies bequeathed to Michael Gove by his predecessor as Lord Chancellor, Chris Grayling, ranks as one of the most misconceived. Those convicted of criminal offences face, rightly, the prospect of fines, contributions to prosecution costs, and payment of compensation to victims. Some contribution to court costs might well be reasonable, but this order, tabled just before the dissolution of Parliament, never having been the subject of consultation, imposes a rigid structure of charges with no judicial discretion as to their amount or any regard as to the defendant’s means. They apply to all cases since 13 April.

A defendant pleading guilty in the magistrates’ court will be charged £150, which will in many cases exceed the fine, prosecution costs and even some compensation orders combined. If defendants are convicted after a not guilty plea, the charge will be £520 or £1,000 in what is called an either-way case—one that could be heard in either the magistrates’ court or the Crown Court. Guilty pleas in the Crown Court will attract a charge of £900, while £1,200 will be levied where there is a conviction following a not guilty plea.

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The uniform imposition of these fixed charges is contrary to the courts’ current approach, which is one of totality—taking into consideration the nature of the offence and the effect, including the financial effect of fines and costs already levied. Judicial discretion under these regulations is being displaced by what one might call Ryanair justice, with significant add-ons, often disproportionate to the basic financial penalty.

Magistrates and others, including the senior judiciary, are concerned not only about the potential impact on those convicted but also about the likelihood that some defendants will plead guilty rather than risk doubling or quadrupling the financial penalty they face. There is of course already something of an inducement to plead guilty in the one-third discount for a guilty plea. But my old firm has experienced a number of cases where charges that could properly have been contested have ended up as guilty pleas, especially—but by no means exclusively—in relation to road traffic matters. Given the number of court closures and the cost of travel and time off work which will increase as a consequence, and is itself a matter of concern, the inducement to plead guilty to less serious offences becomes even greater. The Howard League cites a case in Mansfield, where a defendant changed his plea at the Crown Court upon being advised that if convicted he would face the higher charge described under the order.

There are other potential difficulties. Where there are a number of charges, to some of which the defendant pleads guilty but not to others, the current practice is to deal with those to which the guilty plea is tendered and set the remainder down for trial. That could mean, in the event of conviction, two criminal court charges; the risk arises that for example the imposition of a probation order, possibly subject to medical treatment, would be delayed. As I have exemplified, some courts have resorted in cases where defendants have limited means to order an absolute discharge which avoids the imposition of the criminal law charge but also nullifies the possibility of a victim compensation order. Such is the concern that at least 50 magistrates are known to have retired from the Bench in protest. Nor can it be assumed that the Ministry of Justice’s estimate of the yield from this process—between £65 and £85 million a year—would be easily achieved. After all, earlier this year it was reported that there is £549 million in uncollected fines and that 61% of this amount will be written off. Can the Minister tell us how much of the £700 million contract for court enforcements for which his colleague Mr Vara announced in July that Synnex Concentrix are preferred bidders, related to the collection of this charge?

The financial implications for both defendants and the Government may be somewhat qualified by the curious wording of a four-page guide to the new charge published by HM Courts and Tribunal Service which concludes with the following section under the rubric “What else do I need to know?”. It states:

“If after two years you have made best efforts to keep up with the payment terms of any other financial impositions and the criminal courts charge and you have not been convicted of any other criminal offences during that period you may apply to the magistrates’ court for consideration to write off the criminal courts charge”.

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I am tempted to nominate this remarkable statement, about which nothing is said in the impact assessment, for the Nobel prize for legislative opacity. Perhaps the Minister could enlighten us as to its potential consequences. The House of Lords Secondary Legislation Scrutiny Committee criticised the timing of the implementation of the order, before Parliament had any chance of considering it—because of the pending dissolution—and, tellingly, added that,

“the lack of an updated estimate of the sum likely to be raised”

made it,

“impossible to take a clear view of how the regulations will serve their intended purpose”.

We are, moreover, very much in the early days. Most cases where the charge has been levied will have been where guilty pleas have been tendered. We are now at the point where trials will be proceeding and the larger charges will be imposed in both magistrates’ and crown courts.

It is not surprising that 93% of magistrates surveyed by the Magistrates’ Association thought the charge was set at an unreasonable level, and that 83% thought it should be means-tested.

“The fact that no account is taken of ability to pay and the lack of discretion mean that the charge as currently constituted is not in accordance with the principles of justice.”

Those are not my words, but those of the Magistrates’ Association in its response to the Justice Select Committee. The Lord Chief Justice was reported last week to have voiced his criticism of this ill-thought-out measure, among others, and a Crown Court judge in Leicester observed that the charge did not have any merit.

It is to be hoped that Mr Gove, who has abandoned one ill-conceived project of Mr Grayling’s—the secure college for young offenders—will review and urgently revise these deeply flawed regulations taking into account the concerns of the judiciary at all levels and consulting properly on a revised scheme. The key elements must reflect the concept of totality, have proper regard to the means of the defendant and the nature of the offence and restore judicial discretion. I beg to move.

7.30 pm

Lord Marks of Henley-on-Thames (LD): My Lords, in Committee on the Criminal Justice and Courts Bill, in moving amendments to the Government’s proposals, which are now Part II(a) of the Prosecution of Offences Act 1985, I made it clear that our principal purpose in seeking to amend these provisions was to ensure that the criminal courts charge would be charged on a discretionary, and not a mandatory, basis. Our reasons were that a mandatory charge would be unfair, would frequently have to be imposed when there was clearly no chance that it would ever be paid, and that it would damage offenders’ chances of rehabilitation because offenders with no money would have an unaffordable financial liability hanging over them, which would in turn hinder their chances of obtaining employment, and all for no sensible or realistic purpose.

We never said that such a charge should not be a tool available for the courts to use in appropriate cases, but we wanted the courts to have the power to use it in appropriate cases only, and to decline to do so where it was simply an empty gesture, but one with

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potentially damaging consequences. We also expressed the view that the retrospective power to remit an unpaid charge would prove to be a useless and cumbersome way of dealing with the many cases in which a charge should never have been imposed in the first place.

On Report, in the hope that the then Secretary of State might have softened his view, we moved similar amendments. Unfortunately, it was quite clear that we had failed to move the then Secretary of State, and the legislation was passed in its present form. The criminal courts charge in practice has been even worse than we feared. The charges introduced by these regulations are very high, so that the overall impact of the penalty may be out of all proportion to the offence, particularly where there is a trial. The examples cited by the noble Lord, Lord Beecham, made that very clear.

The Bar Council, which provided a very helpful briefing for this debate, has pointed out how concerned it is about the impact of these very high charges on the rehabilitation of offenders. It stresses that convicted offenders come largely from among the most vulnerable in society, with the greatest difficulties in finding employment. The council and its member barristers see a risk of offenders committing further offences in order to obtain the funds to pay the charge.

The number of magistrates who have resigned over this single issue passed 50 some time ago, and my understanding is that it may now be even twice that. This country and this House deeply value our tradition of lay magistrates being appointed as volunteers to administer criminal justice in our communities in less serious cases. The Conservative Party has long expressed admiration for our magistracy and many prominent Conservatives have in the past been magistrates. However, we cannot expect members of the community to play their part in a justice system that denies them the power to do justice and forces them to take action which they regard as thoroughly unfair, harmful and unjust.

On issues that concern the magistracy, this House has often been greatly assisted by the experience of the noble Lord, Lord Ponsonby of Shulbrede. I see that he is in his place today and I hope that we may hear from him again. But this is what Richard Monkhouse, chairman of the Magistrates’ Association, has said:

“Our members have expressed concerns about the charge from the outset and it shows the strength of feeling when experienced magistrates resign from the bench because of it. … A six-month review is needed with a view to granting judges and magistrates discretion in applying the charge because we know the majority of offenders will never be able to pay, and worse, that it may influence their pleas”.

This last point is particularly important. The regulations stipulate the amounts of the charge, which diverge wildly according to whether a defendant pleads guilty or not guilty. The noble Lord, Lord Beecham, has given the details of the charges. The most serious divergence is in the case of the magistrates’ court, where a plea of guilty is met with a charge of £150 or £180, depending on whether the offence is summary only or triable either way. That becomes a very substantial £520 or £1,000 on a plea of not guilty. In the Crown Court the differential is less marked; the charge is £900 for a plea of guilty and £1,200 for a plea of not

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guilty. However, these differences, particularly in the magistrates’ courts, create a serious risk of injustice. It could not be clearer, I suggest, that defendants who are innocent will be driven to plead guilty because of the impact of this non-discretionary charge for pleading not guilty, imposed whether the trial takes an hour or more than a day.

I had an email from a businessman in Shropshire recently. He had served as a magistrate there for 21 years before resigning over this issue. He wrote that with the charge imposed,

“for simply deciding to go to court to argue your innocence on a trivial offence, the British justice system is in a dire state”.

It is not the proper function of the Secretary of State for Justice to bring our system of justice into disrepute, yet that is precisely what this criminal courts charge has done. Imposing unaffordable penalties on offenders who cannot pay commands no respect, just as it brings no real money into the Treasury. Judges feel that this charge is an abuse of their judicial oath, as their promise to do justice clashes with their obligation to enforce the law. This was well expressed by Judge Christopher Harvey Clark, sitting in Truro, when he told a defendant, as he imposed a £900 charge on a guilty plea in the Crown Court:

“The charge has no bearing on your ability to pay. It is totally inappropriate for people of no means to have to pay this charge. It happens to be current government policy but as an independent judge I regard it as extremely unfair”.

The Howard League has pointed out that the non-discretionary nature of the charge has led to courts feeling compelled to manipulate the outcomes of cases to avoid the effect of the charge which is imposed by statute. So fines have been reduced in order to enable the charge to be imposed. Offenders have been given absolute discharges in cases that could not possibly merit them because magistrates are not prepared to impose the charge on the offender concerned. And perhaps worst of all, victims have been denied compensation, which is discretionary, to enable courts to impose the charge, which is compulsory. In west Yorkshire there was the case of a 21 year-old girl, Chloe Knapton, who was left severely scarred as a result of being injured with broken glass in the street. When sentencing the perpetrator, the Recorder did not order him to pay her compensation simply because he had to impose the compulsory £900 charge. That is no justice for her or for society.

I hope we will secure a review at an early stage, far earlier than the three-year review we were promised, and which is enshrined in statute. The evidence is there now on how much damage this charge is doing, and for how little reward. I invite the Minister to say whether an earlier review may be in prospect and whether he is in a position to give the House clear figures on the extent of the criminal courts charges imposed since they came into force, and how much has been collected. That will enable us to see the extent to which the revenue prediction of £80 million a year looks like being met. I suspect that the real collection figure will turn out to be far lower. But even if it is not, I still oppose these charges. For all the reasons that the noble Lord, Lord Beecham, has given, and those I have canvassed, if the noble Lord seeks the opinion of the House this evening, I will support him.

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Lord Rooker (Lab): My Lords, I had not intended to speak in this debate, but I have just received an email from a friend who is a magistrate. I shall not say where because these days one cannot do that. It is worth putting on the record. He writes:

“Courts are closing in great numbers with another 90 about to be closed and there will be more after this. Defendants and witnesses now have to travel great distances. Some cannot afford it so plead guilty when they may not be. Also, it has removed the fundamental right of citizens to be tried by their peers as the cost of the criminal court charge is so high and beyond most defendants’ means, so they are pleading guilty. It has removed the need of the CPS to prove a case beyond reasonable doubt. Not many well-off people appear in court so it is the poorest who are being hit with a double whammy”.

That is the view of a serving magistrate sitting on the Bench today.

Lord Pannick (CB): My Lords, on this subject, I am on the side of the two Jeremys: the noble Lord, Lord Beecham, and Jeremy Bentham. In 1795, Jeremy Bentham wrote:

“The statesman who contributes to put justice out of reach … is an accessary after the fact to every crime”.

For Bentham, such a law tax was a denial of justice. These regulations are a denial of justice, and they are a denial of justice for the two reasons given by the noble Lords, Lord Beecham and Lord Marks. First, because the sums involved—£150 up to £1,200—may well encourage innocent people to plead guilty, and, secondly, because the magistrate or judge has no discretion to vary the charge by reference to the circumstances of the offence or the offender—in particular, the offender’s means.

I will add a further point. There is a much fairer and more lucrative way forward for a Lord Chancellor who wants to help balance the books by imposing a court charge. Let the Lord Chancellor give the judges and magistrates a discretion to charge much higher court fees to defendants who are convicted of serious crimes and who can afford to pay. The drug dealers, the bank robbers and the fraudsters can be charged the true cost of their occupying the courts for weeks in trials that end in convictions if the judge or magistrate in their discretion thinks that it is appropriate to do so. The regulations could then give the courts a proper discretion not to impose on the small fry charges that may well induce guilty pleas from innocent people and may well result in the imposition of orders for payment from people who cannot afford them. If the noble Lord, Lord Beecham, wishes to test the opinion of the House on these regulations, he will certainly have my support in the Division Lobby.

Lord Brown of Eaton-under-Heywood (CB): My Lords, the points to be made against these regulations are so obvious and so strong that really they do not need to be made yet again in tonight’s debate. The problems—the total lack of judicial discretion, the obvious impossibility of recovery in so many cases and the risk of excessive pressure on defendants to plead guilty to avoid the charge escalating from £150 to £520, or, in an each-way case, from £180 to £1,000—were all foreseen by the noble Lords, Lord Beecham and Lord Marks, in Committee in July of last year. They have all since been the subject of widespread

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criticism by a series of distinguished legal commentators in a succession of legal periodicals such as the

Criminal Law Review

,

Criminal Law and Justice Weekly

and so forth. Professor Nicola Padfield, a most distinguished legal academic and criminologist and now master of Fitzwilliam College, Cambridge, described them as “astonishing” and quoted another commentator as saying that they were the most unworthy provisions on the statute book. The president of the Law Society called them “outrageous”.

7.45 pm

What perhaps were not foreseen in Committee were the consequences that have recently been highlighted in the press, notably in the Times on Monday of this week and in the Independent today: first, the reductions in the awards both of compensation for victims and of prosecution costs in order to be able to accommodate these mandatory costs, both of those being, unlike court charges, within the court’s discretion; secondly, the reduction of fines or other penalties, again as compensation for these charges; and, thirdly, the very powerful objections of the magistracy to the point where already, as we have heard, more than 50 magistrates have resigned in protest. These regulations, the very last of the previous Lord Chancellor’s series of cost- saving or money-making regulations, are the most objectionable of all and must be not merely regretted but withdrawn.

I will add a point on which I touched in earlier debates that concerned the cutting of legal aid or increases in court fees. If the Lord Chancellor truly needs to achieve significant savings, he should revisit the whole question of jury trials. In particular, does a need remain for juries in all cases where presently there is a right to them—even, for example, in serious and complex fraud cases, and even in comparatively trivial cases where the jurors themselves feel that their time is wasted? In January of this year, Sir Brian Leveson—he of the inquiry into the press, now President of the Queen’s Bench Division—produced a comprehensive review of efficiency in criminal proceedings. I commend it to the Lord Chancellor. Pages 87 to 92 discuss these questions. That of course is for the future. For the present, these regulations must indeed be regretted.

Lord Ponsonby of Shulbrede (Lab): My Lords, my contribution concerns both practicalities and the principle of the courts charge. I remind the House that I sit as a lay magistrate in central London. I agree with everything that has been said by the previous speakers. I shall avoid going over examples already given but shall walk through two simple sentencing exercises that illustrate the points with which we are dealing.

If an offender pleads guilty to a summary offence in a magistrates’ court, a band A fine is given. If he is on average income, that fine will be £150. That is at the discretion of magistrates. In addition, there are CPS costs of £85, the imposition of which is, again, discretionary. After that, there is the government surcharge or the victim surcharge of £20, which is mandatory. Then there is the new courts charge of £150, which is mandatory. The total is £405. In this example, 37% is the fine and 37% is the courts charge.

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In the same circumstances, if the offender is on benefits the balance changes. The fine is £40, the CPS cost is £85, the government surcharge is £20 and the courts charge is again £150. The total is £295. In this example the fine for an offender on benefits is 14% of the total figure but the courts charge is half. This is a common type of fine given in the magistrates’ courts. The courts charge is clearly unjust on this consideration alone.

We have heard how unhappy magistrates are and we have heard about the resignations and retirements—and I personally know a couple of magistrates who have retired. However, it is not unusual for magistrates, and I am sure judges as well, to combine competing principles when they make decisions on sentences. We have the principle of totality when we are making a sentence—that is, what is the bottom line? Of course, we have to come up with a total sentence that is fair in all circumstances. But the competing principle is the advice that we get from our justices’ clerks, who are in turn advised by the Justices’ Clerks’ Society, whose advice to us is that we should sentence and then, after the sentence, add in an administrative charge, which is the courts charge. Clearly those two pieces of advice are in contradiction but, in the privacy of the retiring room, magistrates may look at the matters over which they have discretion. I was disturbed to hear about the case in the Independent this morning, where magistrates said that they actually reduced compensation. I believe that that is absolutely wrong, but it is within the power of the magistrates to reduce compensation to reflect the totality of the sentence that they are giving. When the Minister comes to wind up, I am sure that he will remind the House that it is open to magistrates to give an absolute discharge or “one day deemed served”. I and all magistrates in exceptional circumstances use those types of sentences, but it is absolutely wrong to use them as a way in which to circumnavigate the courts charge.

Noble Lords have spoken about the possibility of people changing their plea to guilty to avoid the courts charge. I understand that it is early to get a statistical basis for that, even though a number of anecdotes say that that is what defendants are doing. But it is worth reminding the House of the totality of the situation. We have already heard that the sentence itself can be reduced by up to 30% if somebody pleads guilty at the first opportunity. In addition, the costs asked for by the CPS will be much lower if somebody pleads guilty at the first opportunity, rather than going through trial. Admittedly, this is a discretionary amount, but the amount asked for will be much lower on behalf of the CPS. On top of that, you have the mandatory courts charge, which we have heard so much about, of up to £1,000 for a conviction on an either-way matter in a magistrates’ court. Putting those elements together could encourage people to plead guilty when they believe that they are not guilty.

On the principle of the courts charge it is worth reflecting that, when we debated this matter on the then Criminal Justice and Courts Bill last year, we did not know the level of the courts charge, and the briefings that we received—from the Magistrates’ Association, for example—set the courts charge at the

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same level as that of the victim surcharge, because they did not know any better at the time. So the debate at that time was on the principle of the courts charge, not the proportionality, because the figure is so much higher than we expected when considering the matter last year.

The Government have always justified this matter by saying that criminals should pay their way, and the previous speakers have accepted that principle, but I am not sure that I do accept it. The court system, right up until last year, was an independent administrator of the law, in which judges, magistrates and jurors had no interest in the outcome of a case, their only duty being to administer the law and come to a just outcome. Surely it is wrong that the court system has a financial interest in the outcome of a trial. I am not for a moment saying that any judge or magistrate would be swayed by that consideration, but from the defendant’s point of view and the public perception there is an institutional, built-in benefit to the court system on the result of a trial. On that alone, I oppose the principle of the courts charge.

There is a bit more to it than that—and I refer to some research sent to me about how people perceive how they are treated in court. It is not merely a question of the legal and constitutional rights that they receive but about what they believe to be the fairness of the whole system. There is growing evidence in America and the UK that if people are convicted and believe that they have been fairly treated, they are more likely to comply with the sentence and the sentence itself is likely to have a better outcome. This is a profound observation, which puts an onus on the court system to treat all parties fairly and an onus on treating convicted offenders in such a way that they think they have had a fair crack of the whip, so that they are more likely to comply with the sentence when it is given.

I urge the Government to bring forward a reconsideration of this matter. It is something which, in my 10 years as a magistrate sitting on the Bench, I have found people feel most strongly about.

Lord Woolf (CB): My Lords, what we are discussing concerns what happens in magistrates’ courts up and down the country and, from time to time, in the Crown Court, where for reasons that can be good or bad, cases go to be heard. I fear that these regulations indicate that the Government have paid less attention to what they are doing because it concerns magistrates and the cases that come before them, and other cases that are not the most serious. I see no other reason why the Government could come to the conclusion that it is right and proper to do what these regulations seek to do. I suggest that this House should regard justice in the magistrates’ courts as every bit as important as every other court in the land. It is a total disgrace that we should put on to the statute book provisions that have the consequence that magistrates are so appalled about what they are required to do that they feel it necessary to resign. I regard that as shocking, and the only explanation that I can suggest is the one I have given: that insufficient consideration was given to what has been done.

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Now that the matter has been brought to the attention of a new Minister of Justice and Lord Chancellor, he should look at it very carefully, as quickly as possible and, as he has been shown to have the courage to do, take his own decision and come to the right conclusion. I wish to put it on the record that I have been very pleased by the general approach of our new Minister of Justice and Lord Chancellor. It seems to me that he considers the facts; he may not always come to the decision I would want him to come to, but he comes to a fresh decision, as required by the circumstances as he sees them. I make no objection to the fact that he may take a different view from that which judges and retired judges would have come to. What is wrong here, though—this is the explanation—is that there was no proper consultation. I believe that if there had been proper consultation that had been objectively considered, these regulations would not have seen the light of day.

8 pm

I gratefully adopt what has been said already by previous speakers and I do not wish to repeat what they have said. However, I want to leave a very important message. It is all too easy to chip away at the proud record we have in this country of doing justice regardless of the individual involved. By a little nibble here, and a little nibble there, and sometimes a bite—and this is not a nibble; it is a big bite—real damage is done to the reputation of justice in this country. I urge the Minister to look at this urgently, because it will do real harm, and I hope it will be realised that in haste something was done that should not have been.

Lord Phillips of Worth Matravers (CB): My Lords, in the days when one was allowed to use Latin in court, counsel and judges sometimes delighted in the phrase res ipsa loquitur: the facts speak for themselves, or, the answer is obvious. For the reasons given by every single person who has spoken thus far in this debate, that phrase applies to the motion. I shall not repeat the reasons, but I shall support the motion if I have the opportunity.

The Minister of State, Ministry of Justice (Lord Faulks) (Con): My Lords, I thank all noble, and noble and learned, Lords who have spoken in this debate, in which, although it was short, strong feelings have been expressed and cogent arguments advanced about the criminal courts charge. The Secretary of State for Justice has developed a reputation—referred to by the noble and learned Lord, Lord Woolf—for listening to the arguments and approaching with boldness and imagination the often difficult challenges that justice and paying for the cost of justice present. Although I cannot promise the House an immediate review of this matter, I can promise that all the speeches made today will be carefully heeded by the Secretary of State for Justice. He will be considering them extremely carefully.

Let me deal with some of the points that have been made, succinctly but powerfully. First, on judicial discretion, this was one of the arguments that came before both Houses when the Bill was going through

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Parliament. Indeed, I was the Minister who took the relevant clauses through. The argument—except from the noble Lord, Lord Ponsonby—was not that there are no circumstances in which it is appropriate for a defendant to pay the costs of their appearance in court, but that there should be some discretion. The Government believe that convicted adult offenders should take responsibility and contribute towards the costs they impose. If they do not, of course, the cost is paid by the taxpayer. The criminal courts charge is intended to ensure that offenders take a greater share of the burden, currently borne by taxpayers, of funding the criminal courts.

Imposition of the charge is purely about recovering costs. It is not a punishment and therefore should not be treated as part of the offender’s punishment in any way. Therefore, it would not be appropriate for a discretion to be exercised. The noble Lord, Lord Ponsonby—parting company from a number of other noble Lords—said that he did not accept that any cost should be imposed on a defendant for appearing in court. One of the reasons he gave was that in some way, it would be rather invidious, because a judge or magistrate might be perceived as having some form of financial interest in the outcome of a case. Although I think the noble Lord accepted that that would not be much of a factor in reality, he was in a sense making an important point: that judges and magistrates should not be able to choose whether to charge for the use of a court, as it were, and that it would therefore not be appropriate for there to be a discretion.

I understand entirely that it is most important that the courts charge framework means that offenders are given a fair and realistic opportunity to pay the charge. Although a court does not have discretion in terms of the charge itself, it does have discretion to consider an offender’s means and set payment terms at affordable rates. Offenders will be able to contact a fines officer at any point to request variations in payment rates if their circumstances change. At such points the courts and fines officer will have an opportunity to take existing debts into account, making sure that repayment is reasonable and affordable, given the offender’s individual circumstances.

The criminal courts charge legislation also gives the offender the opportunity to have the charge remitted after two years where the offender takes all reasonable steps to pay it and does not reoffend. It will be for the courts to decide whether all reasonable steps have been taken, having regard to the offender’s personal circumstances. Here matters such as unemployment, interruptions to benefits payments or poor health can be taken into account.

Noble Lords were concerned about the possibility of there being an inducement to plead guilty. Of course, that is a highly relevant consideration. Defendants facing trial are not required to pay the criminal courts charge; they will be subject to the charge only if they are convicted following a hearing, or of course if they plead guilty. It is always a delicate matter whether defendants plead guilty to an offence of whatever seriousness. The noble Lord, Lord Beecham, and others have acknowledged the fact that it is well known that a discount—often of a third—will be given to a defendant

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who pleads guilty, and it will depend on the precise juncture at which that defendant pleads guilty. Pleading guilty at the first possible opportunity will obtain the maximum discount. An experienced legal adviser, such as the noble Lord, Lord Beecham, will approach the question of an appropriate plea with delicacy and will not of course encourage a defendant to plead guilty if there is a defence. Indeed, they will go further than that and tell the defendant that they should not plead guilty to an offence they have not committed. We believe that the delicate matter should not and will not be distorted by the question of a criminal courts charge.

Let me deal with the point that perhaps can be summed up by the principle of totality, which those of us, like me, who have had to sentence defendants have borne very much in mind. It is true that, very often, where there are a number of different sentencing options on the menu and more than one has to be prescribed, a judge will try to make sure that, in the round, the penalty or combination of penalties is meted out that is appropriate to the offence. I understand why certain magistrates have been rather more lenient than they might have been, obviously had there not been the criminal courts charge, but that is not what the legislation provides and is not something that should be done.

The criticism is also advanced that there was a lack of parliamentary oversight in relation to these provisions, and the suggestion is that the statutory instrument severely limited that oversight. There is nothing improper about the time in which the regulations were laid. I can assure noble Lords that the criminal courts charge provisions underwent considerable scrutiny. I can personally testify to the level of scrutiny it underwent in this House. I have looked back at Hansard for the House of Commons, and the principle and the appropriateness of a criminal charge were considered in debates. The question of the actual level of the charge is a different matter—I see the noble Lord, Lord Beecham, grimacing. I wholly understand that there is a distinction.

However, the concerns raised in this Motion regarding discretion and the effects on plea decisions are points that were carefully considered and debated at considerable length at the various stages during the consideration of the Bill in both Houses. As to charge levels, draft charge levels were also published to inform parliamentary and public debate, the charge levels set out in the regulations being a slightly adjusted version reflecting up-to-date costing information. I do not consider that the Government at the time behaved improperly by laying the regulations when they did, especially in light of the significant amount of scrutiny that took place generally on the principle. It may be that magistrates expected there to be a greater amount. This was a difficult attempt to try to cost the use of the courts. The victim surcharge is another mandatory charge—there is no discretion—which was introduced in 2007 by the then Labour Government.

On the question of benefits assessment, regarding the suggestion that claims on savings cannot be substantiated, an impact assessment was published when the Act was introduced early last year that was based on indicative charge levels. Significant work was

14 Oct 2015 : Column 308

then carried out to assess the costs of running the criminal courts, which resulted in the publication of the draft charge levels I have previously mentioned. This was published as an addendum to the original impact assessment and included an updated analysis of the benefits and costs of the policy. An updated impact assessment was produced to accompany the regulations and has now been published. It includes a considered analysis of the benefits and costs of the provisions, estimating total cash inflows arising from the charge at £95 million from 2019 to 2020.

A number of noble Lords remarked on the unfortunate response of a large number of magistrates. I agree with all noble Lords who have emphasised the importance of magistrates and what a vital task they perform for society in general, and we are of course concerned that any magistrates should not feel confident in the provisions of sentencing and indeed other provisions that they have to administer. Of course I have read about and the Government are well aware of those magistrates—reported in the media to number something like 50—who say that the courts charge was certainly one of the reasons for their resignation. Just for context, I should say that I understand that 350 magistrates have resigned in the relevant period, and of course others will have retired. They may have myriad reasons for doing so. However, I do not want to underestimate the significance of the general discontent referred to by the noble Lords, Lord Rooker and Lord Ponsonby, and others. The Secretary of State and the Ministry of Justice take that matter very seriously.

I also bear very much in mind what a number of noble Lords have said about the importance of rehabilitation. We do not believe that this will be an additional barrier to rehabilitation. The Government are extremely concerned that rehabilitation should be at the heart of reforms to our sentencing provisions and indeed in the way in which the prison service will, we hope, be changed in the following years. I should say that failure to pay the court charge will not extend the time it takes for a conviction to become spent for the purposes of the Rehabilitation of Offenders Act 1974. I take the point made by the noble Lord, Lord Ponsonby, that it is important that defendants feel that they have been dealt with fairly, and that itself can be relevant to their rehabilitation. However, we consider that setting the repayment rate fairly and proportionally according to each offender’s individual circumstances, as long as they provide the court with the details, should mitigate any sense they have of unfairness which may follow the criminal courts charge.

8.15 pm

Although the noble Lord, Lord Pannick, may not have extensive experience in the magistrates’ court, he is none the less concerned for justice, and as such we benefited from his contribution to the debate. All noble Lords from all sides are of course concerned, as are the Government, that there should be justice and that the criminal courts charge should not impede that. However, I am sure that all noble Lords will also accept that Governments are reasonable in seeking to try to recover some of the costs of defendants appearing in court—the result when they are convicted of their own offences. I take the point made by the noble Lord,

14 Oct 2015 : Column 309

Lord Pannick, that those who have greater means may well be regarded as being better able to contribute to those costs, which is a factor that should be borne in mind.

I will repeat in conclusion what I said at the outset—that we are listening; we have listened to the concern about these charges. The capacity to review is built in to the legislation. I will not give any undertakings or promises from the Dispatch Box or raise expectations, but I can assure the House that the matter is very much on the agenda of the Ministry of Justice.

The House has been greatly assisted by everything that has been said. I hope that the noble Lord, Lord Beecham, will accept from me the seriousness with which the Government take those concerns. This regret Motion has effectively underlined those concerns. I hope that, in that spirit, the noble Lord will feel able—notwithstanding the presence of a number of noble Lords on that side of the House—not to press this regret Motion.

Lord Beecham: My Lords, the Minister can live in hope. I have a certain sense of déjà vu when listening to the elegant defence the Minister makes of the indefensible. I remember the skill with which he sought to defend the previous Lord Chancellor’s secure college proposal, which was interred not too long ago by the new Secretary of State, and I rather think he is in the same position tonight—I rather hope that he is.

The Secretary of State the Lord Chancellor is reported today in the press to have made a very significant change in the Government’s policy relating to justice by persuading the Government to withdraw from their proposal to offer the service of the splendidly named Just Solutions International to the Government of Saudi Arabia in the light of the dreadful position of a British citizen that, unfortunately, we are all familiar with. The Lord Chancellor may need some support in seeking to change the system and these regulations—which he inherited—in order to promote, let us say, just solutions nationally as opposed to internationally. The opinion of this House may strengthen his hand with regard to discussions with colleagues who in the other context seem to have been somewhat recalcitrant. In those circumstances, therefore, I wish to test the opinion of the House.

8.19 pm

Division on Lord Beecham’s Motion

Contents 132; Not-Contents 100.

Motion agreed.

Division No.  4

CONTENTS

Aberdare, L.

Adams of Craigielea, B.

Andrews, B.

Armstrong of Hill Top, B.

Bach, L.

Bakewell of Hardington Mandeville, B.

Bassam of Brighton, L. [Teller]

Beecham, L.

Berkeley, L.

Brookman, L.

Brown of Eaton-under-Heywood, L.

14 Oct 2015 : Column 310

Campbell-Savours, L.

Carlile of Berriew, L.

Cashman, L.

Clark of Windermere, L.

Collins of Highbury, L.

Colville of Culross, V.

Corston, B.

Cotter, L.

Craigavon, V.

Crawley, B.

Davies of Oldham, L.

Dholakia, L.

Donaghy, B.

Drake, B.

Dubs, L.

Elder, L.

Falconer of Thoroton, L.

Farrington of Ribbleton, B.

Foster of Bishop Auckland, L.

Foulkes of Cumnock, L.

Gale, B.

Giddens, L.

Golding, B.

Gould of Potternewton, B.

Grantchester, L.

Grender, B.

Grocott, L.

Hannay of Chiswick, L.

Hanworth, V.

Harris of Haringey, L.

Harris of Richmond, B.

Hayter of Kentish Town, B.

Healy of Primrose Hill, B.

Henig, B.

Hollis of Heigham, B.

Howarth of Newport, L.

Hoyle, L.

Hughes of Woodside, L.

Humphreys, B.

Hussain, L.

Jay of Paddington, B.

Jones, L.

Jones of Whitchurch, B.

Jordan, L.

Judd, L.

Kennedy of Cradley, B.

Kennedy of Southwark, L.

Kinnock, L.

Kinnock of Holyhead, B.

Kinnoull, E.

Kirkhill, L.

Kirkwood of Kirkhope, L.

Kramer, B.

Lawrence of Clarendon, B.

Lee of Trafford, L.

Lipsey, L.

Loomba, L.

McAvoy, L. [Teller]

McDonagh, B.

McFall of Alcluith, L.

McIntosh of Hudnall, B.

MacKenzie of Culkein, L.

McKenzie of Luton, L.

Maddock, B.

Mallalieu, B.

Marks of Henley-on-Thames, L.

Massey of Darwen, B.

Maxton, L.

Meacher, B.

Mendelsohn, L.

Morgan, L.

Newby, L.

Northover, B.

Nye, B.

Paddick, L.

Pannick, L.

Patel of Bradford, L.

Phillips of Worth Matravers, L.

Pinnock, B.

Pitkeathley, B.

Ponsonby of Shulbrede, L.

Prescott, L.

Quin, B.

Ramsay of Cartvale, B.

Randerson, B.

Reid of Cardowan, L.

Rennard, L.

Richard, L.

Roberts of Llandudno, L.

Rooker, L.

Rosser, L.

Rowlands, L.

Royall of Blaisdon, B.

Scott of Needham Market, B.

Scriven, L.

Sharp of Guildford, B.

Sherlock, B.

Shutt of Greetland, L.

Smith of Basildon, B.

Smith of Newnham, B.

Soley, L.

Stone of Blackheath, L.

Storey, L.

Taylor of Bolton, B.

Thornton, B.

Tomlinson, L.

Touhig, L.

Trees, L.

Tunnicliffe, L.

Tyler, L.

Tyler of Enfield, B.

Uddin, B.

Wallace of Tankerness, L.

Walpole, L.

Watson of Invergowrie, L.

Watson of Richmond, L.

Wheeler, B.

Whitaker, B.

Wigley, L.

Winston, L.

Woolf, L.

NOT CONTENTS

Ahmad of Wimbledon, L.

Altmann, B.

Anelay of St Johns, B.

Ashton of Hyde, L.

Bates, L.

Berridge, B.

Black of Brentwood, L.

Borwick, L.

Bourne of Aberystwyth, L.

Brabazon of Tara, L.

Bridges of Headley, L.

Brougham and Vaux, L.

Browne of Belmont, L.

Browning, B.

Byford, B.

Carrington of Fulham, L.

Cathcart, E.

Cavendish of Furness, L.

Chalker of Wallasey, B.

Chisholm of Owlpen, B.

Coe, L.

Courtown, E.

De Mauley, L.

Denham, L.

Dixon-Smith, L.

Dunlop, L.

14 Oct 2015 : Column 311

Eaton, B.

Elton, L.

Empey, L.

Evans of Bowes Park, B.

Faulks, L.

Feldman of Elstree, L.

Fink, L.

Finkelstein, L.

Fookes, B.

Framlingham, L.

Freeman, L.

Freud, L.

Gardiner of Kimble, L. [Teller]

Geddes, L.

Glenarthur, L.

Glendonbrook, L.

Gold, L.

Goldie, B.

Greenway, L.

Hay of Ballyore, L.

Hayward, L.

Helic, B.

Higgins, L.

Holmes of Richmond, L.

Hooper, B.

Horam, L.

Howard of Rising, L.

Howe, E.

Hunt of Wirral, L.

Inglewood, L.

James of Blackheath, L.

Jenkin of Kennington, B.

Jopling, L.

Kilclooney, L.

Kirkham, L.

Lang of Monkton, L.

Lingfield, L.

Lyell, L.

McColl of Dulwich, L.

MacGregor of Pulham Market, L.

14 Oct 2015 : Column 312

Marlesford, L.

Mawhinney, L.

Morris of Bolton, B.

Moynihan, L.

Neville-Jones, B.

Neville-Rolfe, B.

Newlove, B.

O'Cathain, B.

O'Neill of Gatley, L.

Perry of Southwark, B.

Prior of Brampton, L.

Ribeiro, L.

Risby, L.

Rotherwick, L.

Seccombe, B.

Selkirk of Douglas, L.

Selsdon, L.

Sharples, B.

Sherbourne of Didsbury, L.

Shields, B.

Shrewsbury, E.

Spicer, L.

Stedman-Scott, B.

Stowell of Beeston, B.

Strathclyde, L.

Taylor of Holbeach, L. [Teller]

Trenchard, V.

True, L.

Ullswater, V.

Wasserman, L.

Whitby, L.

Williams of Trafford, B.

Young of Cookham, L.

Younger of Leckie, V.

House adjourned at 8.30 pm.