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Grand Committee

Monday, 23 November 2015.

Representation of the People (England and Wales) (Amendment) (No. 2) Regulations 2015

Motion to Consider

3.30 pm

Moved by Lord Bridges of Headley

That the Grand Committee do consider the Representation of the People (England and Wales) (Amendment) (No. 2) Regulations 2015

Relevant document: 6th Report from the Joint Committee on Statutory Instruments

The Deputy Chairman of Committees (Lord Brougham and Vaux) (Con): If there is a Division in the Chamber, the Committee will adjourn for 10 minutes.

The Parliamentary Secretary, Cabinet Office (Lord Bridges of Headley) (Con): My Lords, the instruments before us today will enhance the operation of individual electoral registration, which was successfully introduced last year. In Great Britain, more than 12 million people applied to register under IER, with three quarters of those applying online.

The Minister for Constitutional Reform has spoken about the future vision for electoral registration: maximising opportunities for a complete and accurate register, and making sure that as many of our citizens as possible can participate in our democracy. We know that people rightly expect digital services to be built around them. The Government want to do this while making the system as efficient as possible and driving down costs. These instruments make a modest contribution towards that.

The instruments remove the requirement for IER applicants to provide their previous name if it has changed in the previous 12 months. Instead, they allow an applicant to provide their most recent previous name if they wish, but provision of this information is not mandatory. The application form will explain that, where previous name details are not provided, additional personal information may be required to verify the application.

Secondly, the instruments make changes to the correspondence required to be sent by electoral registration officers to electors and applicants for electoral registration. Thirdly, the regulations update the electoral registration application form and the annual canvass form to bring them in line with changes made by the Criminal Justice and Courts Act 2015 to the jury-summoning age in England and Wales. This will ensure that the correct information for jury summoning is collected on the electoral register. They will also authorise EROs in England and Wales to inspect marriage records in order to improve the accuracy and completeness of the electoral register. Finally, they make a minor consequential amendment relating to the provision of personal identifiers for postal voting.

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The Scottish instrument does not make provisions consequent on the change to the jury age because the changes do not apply in Scotland; nor on the change to access to marriage records, as EROs in Scotland are already authorised to inspect these records.

The previous Government originally intended to make the giving of the most recent previous name mandatory in draft regulations last year. Following concerns raised by users, including from the transgender community, that provision was removed so that further consultation could take place. It emerged that a more acceptable solution would be for IER applications to require the applicant’s most recent name on a voluntary basis. The regulations before your Lordships effect such a change.

The changes to correspondence are designed to help reduce the administrative burden on EROs and the potential for confusion among members of the public by avoiding multiple pieces of correspondence. The regulations will amend the way in which EROs send confirmation of registration to successful applicants and the information that that confirmation must contain. When EROs have conducted a review of an individual’s entitlement to registration, they will require the ERO to notify that individual in writing of the outcome, and provide information about the appeal process. They also require the ERO to send the individual notice in writing of the outcome of a hearing of a review, and provide information about any appeal process. They will amend the categories of cases in which the ERO does not need to send a letter to any person affected by an alteration in the electoral register.

On the provisions related to the upper age limit for jury service, the register is used as the basis on which people are called for jury service in England and Wales, and EROs have a statutory duty to supply this information. The age limit will change from 70 to 75 in early 2016, and the regulations will require an applicant who is unable to provide their date of birth to specify if they are 76 or over. EROs also issue canvass forms pre-populated with details of electors, including whether they have indicated that they are over 70. These regulations will require the form to specify whether an elector is 76 or over.

Finally, giving authorisation for EROs in England and Wales to inspect marriage records could alert EROs to electors who may wish to change their name on the electoral register, and could also be used to verify the identity of an applicant whose identity cannot be verified using DWP data-matching. That is because proof of name, surname and date of birth is now required in order to marry in the UK. This would reduce the number of applicants who have to provide documentary evidence to establish their identity.

There has been considerable consultation on these provisions. On the previous name and correspondence provisions, the Electoral Commission, while content overall, said that there was some uncertainty about the likely impact on electors and the electoral administration process and that the Cabinet Office should therefore consider how best to assess the impact of the change. The Cabinet Office has responded that it will, together with the commission, continue to monitor completeness and accuracy of the register. It has also given assurances to the commission that the online registration website

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will be amended to ensure consistency with amendments to the paper application form, and that there is no change to the requirement that, when individuals apply to register by telephone or in person, the ERO must record the required information in writing and submit the completed form for verification. The Cabinet Office also confirmed that it intended to make the regulations in December 2015, subject to parliamentary approval, and would continue to consult with the commission over form design.

The Information Commissioner’s Office—the ICO—while welcoming the intended explanation to applicants that provision of previous name information was not mandatory, suggested including further clarification that, when previous name information was not supplied, additional personal information might be required to verify an application. This suggestion has been adopted in the draft regulations. The Association of Electoral Administrators and other electoral administrator organisations consulted responded that making provision of the most recent previous name voluntary would probably have a negative impact, since people may not provide the information, and applicants should be asked to give all previous names. The Society of Local Authority Chief Executives considered that it would lead to more time spent resolving queries. The Government have carefully considered these issues but have decided not to change their policy on previous names. The extra words of clarification suggested by the ICO will give a stronger message about the consequences of not providing previous name information.

On the jury age provisions, the Electoral Commission was content with the proposed timetable for the instrument. The commission pointed out that, if the referendum on the United Kingdom’s membership of the European Union were held in autumn 2016, it could have an impact on the timing of the publication of the register after the 2016 canvass and the consequent availability of information about jurors. The Government responded that, in the event of the timing of such a referendum impacting on the 2016 canvass, this would be considered alongside any other pertinent issues relevant to the conduct of the 2016 canvass. The commission will also make reference to inspection of marriage records in its guidance for EROs.

The ICO was also consulted on the jury age and marriage records regulations, and did not consider that they raised any new or significant data protection or privacy issues. On jury age, SOLACE raised the point that information about over 75 year-olds would not be available until after the 2016 canvass. The Government responded that this is why the measure will not come into force until after 1 December 2015. The Government Equalities Office raised some concerns regarding EROs inspecting marriage registers and how this might potentially affect transgender people. The Government informed the GEO that guidance on the use of this information would be a matter for the commission, and ensured that there was a discussion between the GEO and the commission on the production of guidance.

In conclusion, the Government believe that the instruments before the Committee today will enhance IER, and I commend them to the Committee.

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Lord Kennedy of Southwark (Lab): My Lords, these regulations make a number of changes to the information that needs to be supplied to EROs when applying to register to vote under IER, along with changes to jury summoning in England and Wales, and to correspondence and postal voting. On this issue the Government have on far too many occasions got the balance wrong between completeness and accuracy. They have continued, as they did in the last Parliament, to fail to secure cross-party agreement on these matters, which is a matter of great regret. When my noble friend Lord Wills was in the other place, he had responsibility for these matters. He always sought to get cross-party agreement, which he took seriously. We are not doing that now and it is very regrettable.

I accept that these are relatively small matters, but I fail to see how they help to improve the completeness of the register. The noble Lord said that the Electoral Commission referred to the uncertainty of the impact on electors and on the electoral administration process. Furthermore, as the noble Lord mentioned, the Association of Electoral Administrators thought that this would have a negative impact, as we are moving from mandatory to voluntary previous name provision. SOLACE thought the same.

I find the comments in paragraph 7.2 of the Explanatory Memorandum extraordinary. You are saying that the provision of a previous name increases verification rates, whether it has changed after more or less than 12 months, so you then remove the 12-month mandatory rule and totally ignore the professionals who think that this could lead to fewer people giving the information, thereby increasing the cost and bureaucracy and making the register less complete. This is an example of the Government interfering where they are not wanted. They should have left well alone.

I did not see any reference to political parties in the consultation, which the noble Lord talked about in his remarks. It is not good enough for the Government to say that they will leave it to the Electoral Commission to talk to the political parties. To be clear, it does not do so on these matters. The Government need to consult with the political parties about elections as part of the process. Many experts in all the parties’ headquarters give advice on these things.

Will the noble Lord also provide me with a copy of the ministerial guidance referred to in paragraph 9.1 of the Explanatory Memorandum and explain further how the Cabinet Office will review the completeness and accuracy of the register as referred to in paragraph 12?

Lord Bridges of Headley: I thank the noble Lord for his short but sweet intervention. I am sorry to say that we might disagree on some points. I do not believe that these provisions quite do what he says. I believe that they will enable us to create a more complete and more accurate register.

The noble Lord asked some detailed questions about how we made these decisions. I will review his questions and, if I may, write to him in due course. In particular, I am more than happy to pick up his point on consultation with political parties as we look ahead in the months to come. Even if we disagree on certain matters, we all

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certainly agree that we want to see more people engaged in our political system and registered to vote. That is an aim we all share, and I am more than happy to consider ways to work with him on that.

Lord Kennedy of Southwark: I am very pleased to hear that. Before the noble Lord was in the House and had his present responsibilities, I was never convinced by that at all. We could do far, far more. As we all know, millions are not registered to vote in this country. That is an absolute disgrace for a democracy such as ours. We could do much more on this, but we are just not getting there at all at the moment.

Lord Bridges of Headley: I am happy to talk to the noble Lord outside of the Room on that precise point. I do not want to rehearse all the arguments we had on the IER debate a few weeks back, but I believe that there has been some confusion over those who are not on the register and those who are entitled to vote. We need to get more people on the register and encourage greater engagement. I am more than happy to discuss that with the noble Lord. As I said, I will endeavour to write to him to address any of the other points.

Motion agreed.

Representation of the People (Scotland) (Amendment) (No. 2) Regulations 2015

Motion to Consider

3.42 pm

Moved by Lord Bridges of Headley

That the Grand Committee do consider the Representation of the People (Scotland) (Amendment) (No. 2) Regulations 2015

Relevant document: 6th Report from the Joint Committee on Statutory Instruments

Motion agreed.

European Parliamentary Elections (Miscellaneous Provisions) (United Kingdom and Gibraltar) Order 2015

Motion to Consider

3.43 pm

Moved by Lord Bridges of Headley

That the Grand Committee do consider the European Parliamentary Elections (Miscellaneous Provisions) (United Kingdom and Gibraltar) Order 2015.

Relevant document: 8th Report from the Joint Committee on Statutory Instruments

The Parliamentary Secretary, Cabinet Office (Lord Bridges of Headley) (Con): My Lords, the draft order relates to the functioning of the Political Parties, Elections and Referendums Act 2000 as it applies to Gibraltar.

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The Act provides the regulatory framework for political parties and campaigners at elections and referendums. In 2004 the Act was updated to take account of the extension to Gibraltar of the franchise for European Parliament elections. This included establishing which Gibraltar individuals and bodies were eligible to campaign at European parliamentary elections in the south-west region, or to donate to political parties contesting those elections. As far as possible, the eligibility criteria follow the principles that determine which UK individuals and bodies are eligible to donate to political parties and campaign at national elections.

Noble Lords will be aware that the proposed referendum on our membership of the European Union will also take place in Gibraltar. As a result, the European Union Referendum Bill, currently being debated in the Chamber on Report, applies various provisions of the Act that deal with Gibraltar matters.

In drafting the EU Referendum Bill, and from discussions with the Government of Gibraltar, it has been clear that certain references to Gibraltar legislation in the Act are now out of date or otherwise inaccurate. To ensure the effective functioning of the EU referendum, as well as future European parliamentary elections, it is necessary to update and correct these references, and the order will deliver that.

The order also substitutes references to the “House of Assembly of Gibraltar” with references to the “Gibraltar Parliament”. The Gibraltar Parliament replaced the House of Assembly of Gibraltar as a result of the Gibraltar Constitution Order 2006.

Finally, the order also removes certain redundant transitional provisions which accounted for circumstances before the publication of the first version of the Gibraltar electoral register for the purpose of European Parliament elections.

I reassure noble Lords that, in accordance with the Government’s statutory duty, the Electoral Commission has been consulted on this order and has confirmed that it is content with it. Officials have also worked closely with the Government of Gibraltar in preparing the order. I therefore commend it to the Committee.

Lord Kennedy of Southwark (Lab): My Lords, I have no comment to make about the order. It is all very straightforward, so I am very happy to support it.

Motion agreed.

3.46 pm

Sitting suspended.

Small and Medium Sized Business (Credit Information) Regulations 2015

Motion to Consider

3.48 pm

Moved by Lord Ashton of Hyde

That the Grand Committee do consider the Small and Medium Sized Business (Credit Information) Regulations 2015

Relevant document: 4th Report from the Joint Committee on Statutory Instruments

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Lord Ashton of Hyde (Con): My Lords, I shall speak also to the draft Small and Medium Sized Business (Finance Platforms) Regulations 2015. With permission, I will refer to these as the draft regulations henceforth.

The Government are committed to ensuring that small and medium-sized enterprises—SMEs—can access the finance that they need to grow and to create jobs. Currently, the four major banks account for 80% of SMEs’ main banking relationships. The Government believe that such high concentration levels are bad for business and they are determined to see a significant change in competition in the UK SME banking market.

These draft regulations represent the final legislative piece of two flagship measures to improve competition in the SME lending market. They will remove major structural barriers to entry in the SME lending markets—namely, a lack of availability of credit information, a lack of understanding of alternative finance providers and a tendency on the part of most SMEs to give up when they are declined for finance.

It may be helpful at this point if I provide some detail on the need for these regulations. Although these draft regulations are linked and complement each other, I will start by focusing on the aspects relating to credit information.

A lender needs to know the creditworthiness of an SME in order to lend to it. The major banks have access to those data, particularly current account data, which gives them a comparative advantage in assessing the risk of a borrower. The control of information on the creditworthiness of SMEs by existing providers is a barrier to entry in the lending market. Lack of access to those data limits the ability of challenger banks and alternative finance providers to accurately assess credit risk, both in absolute terms and relative to those lenders that hold the relevant information. This barrier can be removed through the sharing of credit data by lenders. In the UK, data are shared through private credit reference agencies—CRAs. However, certain data, particularly current account data, are shared through “closed user groups” and not on an equal basis. This puts newer lenders that do not have access to the full range of data at a disadvantage in taking well-informed credit decisions.

The Office of Fair Trading, the Competition Commission, the Bank of England, the Boosting Finance Options for Business review, headed by Tim Breedon, and numerous think tanks and informed commentators have all highlighted the lack of SME credit information as a barrier to competition in the SME banking market and SME lending in particular.

These draft regulations will open up the closed groups that have access to certain types of information. This will level the playing field between providers, allowing alternative finance providers and challenger banks to accurately conduct SME credit risk assessments and make it easier for SMEs to seek a loan from a lender other than their bank. More available data should also enable a better understanding of the SME sector, which should further stimulate competition and innovation in SME lending, improving the cost and quality of services offered.

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I will now turn to the finance platforms draft regulations, which will also have a major impact on the ability of SMEs to access more and better finance and on the ability of challenger banks and alternative finance providers to compete effectively.

Survey data show that many small businesses approach only the large banks when seeking finance. A large number of these applications are rejected. In the case of first-time small and medium-sized business borrowers, the rejection rate is around 42%. We know that when applications are declined, a large number of smaller businesses cancel their plans rather than exploring alternative options. As other finance providers with different business models may be willing to lend to these businesses, this represents a market information failure, with borrowers looking to borrow and lenders willing and able to lend, but an inability on the part of both to identify each other.

Under this legislation, designated banks will be required to offer any SME they decline for finance the chance to have its details shared with an online platform that can help match it with other finance providers. This will help put together the alternative finance providers and challenger banks that may not be aware of the SMEs seeking finance and the SMEs seeking finance that may not know about alternative providers and challenger banks. This will help facilitate more lending to SMEs that are looking to grow and expand.

Challenger banks and alternative finance providers have been very supportive of both proposals, as are the UK’s major business groups, including the Federation of Small Businesses and the Confederation of British Industry. The major banks and the British Bankers’ Association have also been supportive.

Together, these policies have the potential to create a significant change in the market for SME finance. However, for this to happen it is essential that SMEs have confidence in how their data are being used, and that the necessary protections are in place to safeguard the quality of those data. The Government have ensured that SME protections are key elements of the policy design.

The Government have provided SME protections in a number of ways. I will start by outlining the protections afforded to SMEs under the credit information draft regulations. First, data will be shared only where the terms of the products themselves allow data to be shared with credit reference agencies. This reflects the existing framework for the sharing of personal data in the UK and is in line with Data Protection Act legislation. Secondly, the finance provider requesting access to the information from the CRA must gain the express permission of the SME to do so and can access the information only for the purpose of undertaking a credit assessment.

Thirdly, the vast majority of SMEs—sole traders, small partnerships and unincorporated bodies—have the right to action in respect of any incorrect data held about them by a CRA. This allows a complaint to be made to the CRA seeking correction, a complaint to be made to the FCA or the Information Commissioner and, ultimately, a court to order the CRA to rectify, block, erase or destroy any incorrect data. These rights are enshrined in the Data Protection Act and Consumer Credit Act legislation. However, there is currently a

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difference in protections if the CRA in question is FCA regulated or non-FCA regulated. CRAs that handle mainly business data do not need to be regulated by the FCA as the provision of commercial credit data is an unregulated activity. The credit information regulations will modify both the Data Protection Act and the Consumer Credit Act to ensure that the protections apply for data held by all designated CRAs.

Fourthly, these draft regulations will extend the right of action in respect of any incorrect data provided under the draft regulations to all SMEs, including companies. This allows a court to order the CRA to rectify, block, erase or destroy any incorrect data held on any SME. Finally, the draft regulations will extend the remit of the Financial Ombudsman Service so that any micro-business with a dispute with any designated CRA can seek a Financial Ombudsman Service decision which replicates the situation in other areas of the regulated financial sector.

I turn now to the protections provided to SMEs under the finance platforms draft regulations. First, data are provided to finance platforms only with the SME’s agreement, and finance platforms can provide those data to finance providers on their lending panel only in an anonymised form. Finance providers will then make expressions of interest through the platforms, and SMEs will have the choice to allow specific finance providers to see their details and begin a bilateral conversation. This process will ensure that the business seeking finance remains protected and in control throughout the process.

Secondly, and mirroring the credit information draft regulations, the finance platforms draft regulations will extend the remit of the Financial Ombudsman Service so that any micro-business with a dispute with any designated finance platform can seek a Financial Ombudsman Service decision. Taken together, these are a welcome strengthening of protections for SMEs and have been welcomed by SMEs themselves and business groups.

I turn now to the issue of designation and I will identify the banks, CRAs and finance platforms upon which the obligations contained within these draft regulations will fall. The Government have already announced that they intend to designate RBS, Lloyds, Barclays, Santander, HSBC, Allied Irish Bank, Bank of Ireland and Danske Bank. This decision was made on the advice of the Bank of England based on market share and the importance of these banks in the SME lending market in both Britain and Northern Ireland. Capturing these banks achieves the policy objective of opening up competition in SME lending without imposing the burden of sharing data on smaller credit providers. The Government have not yet announced which CRAs or finance platforms will be designated under these draft regulations. The British Business Bank is currently undertaking a due diligence process on CRAs and finance platforms that have expressed an interest in becoming designated and will advise HM Treasury on designation later in the autumn. This due diligence process will ensure that any CRA or finance platform which is designated has the required systems and processes to ensure that the obligations and policies within the draft regulations can be carried

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out while providing the necessary protections for SMEs. This will help ensure that these policies are successful and can make a significant positive impact in the SME lending market.

I hope that my words this afternoon have assured noble Lords that the draft regulations are needed and welcomed, and that they will make a positive impact on the SME lending market and therefore provide for improved outcomes for the UK’s SMEs when accessing finance. They will help to create a level playing field between finance providers and make small businesses aware of alternative finance options, while maintaining and strengthening protections for our smallest businesses. This will mean that the small businesses that are so vital to the UK economy can have confidence when accessing finance and can continue to get the finance they need to grow and expand.

4 pm

Lord Tunnicliffe (Lab): My Lords, I thank the Minister for his clear and thorough presentation of these two sets of regulations. As he outlined, these two statutory instruments will help small and medium-sized businesses access finance. The first instrument concerns the information available to finance providers of SMEs where the SME in question has given permission. SME lenders above a certain market share threshold will be required to share credit data on their SME customers with credit reference agencies for the purpose of credit scoring. CRAs will also be required to ensure that there is equal access to this data for alternative credit providers.

The second instrument addresses SMEs’ ability to access the finance they need in order to start and sustain their business models. The orders would require designated banks to refer details of SME applicants who are turned down for finance, with the SME’s permission, to private sector platforms that will facilitate contact with alternative finance providers that are looking to offer finance. The intent of both these measures is to ensure that the process behind SME lending is easier and that the present barriers experienced by many SMEs are removed. These are principles which the Labour Party wholeheartedly supports. The Federation of Small Businesses states that small firms account for 99.3% of all private sector business in the UK. They employ 15.6 million people and have a combined turnover of £1.75 trillion. The country’s economic success depends on small businesses thriving.

Given this, as my honourable friend Rob Marris said in the other place, we will not oppose these orders. That said, there are still a number of points that I would like to raise which I hope the Minister can clarify in his response. In 2012, the Breedon task force stated that the Government have a role to play in encouraging lending,

“through the disclosure of data that sits within public bodies.”

Can the Minister outline what the Government have done in the intervening three years to play their role? For example, did they encourage RBS and Lloyds Bank to lend particularly to SMEs? As has already been outlined, the first statutory instrument relates to the need to make credit information on SMEs more accessible. Can the Minister indicate what greater data sharing banks have done with non-bank providers?

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Are there examples of best practice that can be followed and will these be included in the implementation guide? The Explanatory Memorandum states that an implementation document will be produced; can the Minister set out a timeline for its introduction?

Turning explicitly to the finance platforms instrument, in section 10 of the Explanatory Memorandum the Government state:

“It has not been possible to monetise many of the benefits of this measure”.

Yet the impact assessment dedicates two pages to setting out the benefits for small businesses, saying that, “Applying these averages across the 25,500 successful businesses seeking loans from alternative providers via platforms suggest that this policy could increase the supply of credit to SMEs by approximately £1.4 billion”. I ask the Minister very simply: which one is it? The Government can either provide monetised estimates or not; they cannot do both. I would be grateful for some clarification.

I would like to make a final point specially relating to these measures concerning credit reference agencies—CRAs. During the debate in the other place, the Financial Secretary to the Treasury said:

“The Government have not yet announced which CRAs or finance platforms will be designated under the draft regulations. The British Business Bank is currently undertaking a due diligence process on CRAs and finance platforms that have expressed an interest in becoming designated, and it will advise the Treasury on designation later in the autumn. The due diligence process will ensure that any designated CRA or finance platform has the required systems and processes to ensure that the obligations and policies within the draft regulations can be carried out, while providing the necessary protections for SMEs. That help will ensure that these policies are successful and have a significant positive impact on the SME lending market”.—[Official Report, Commons, Third Delegated Legislation Committee, 5/11/15; col. 6.]

While I accept that the necessary due diligence has to be carried out, it is regrettable that these regulations were introduced before a decision on the CRAs had been made. There may be a perfectly reasonable explanation, and I would be grateful if the Minister could say something more on this. Does he not think that a more informed and constructive debate could have taken place if we had had ready access to information about who the credit agencies are going to be? Finally, can the Minister say when he expects a full list of the CRAs and finance platforms to be available and whether further regulations will be required?

It is also up to CRAs, as I understand it, to apply to be designated under the credit information regulations. Will the Minister explain to the Committee the Government’s thinking on why that will not be compulsory? As I have already said, we support any attempts by the Government to make the life of small businesses easier, and that is why we are not opposing these instruments. They do, however, deal very much with the start of a small business’s life and, in ending, I would like to ask the Minister about the other end of the spectrum, which is of course inextricably connected.

Does the Minister not agree that, while it is all well and good enabling the start-up of more SMEs, this means very little in the long term if they are not sustainable because so many are held back by late payments? The Government are not doing nearly enough to compel larger businesses to pay their smaller counterparts.

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Does the Minister not agree that we need to promote a culture of prompt payment and that the Prompt Payment Code just does not go far enough? The Government need to start legislating to create these obligations, rather than expecting things to change by sticking to the status quo.

The SME access to finance study found that two-fifths, or 43%, of businesses say that they are concerned or very concerned about cash flow over the next 12 months, but their biggest problem, experienced by a quarter of SMEs, is late and failed payments from customers. Seventy per cent of small businesses do not grow—they remain small businesses—so, for the sake of their sustainability, it is vital that we get this right.

These are issues which we will be addressing in the Enterprise Bill. However, I would appreciate it if the Minister would respond to the points that I have made —if not now then in writing after the Committee.

Lord Ashton of Hyde: My Lords, I thank the noble Lord for his support for these regulations and I shall try to answer the questions that he asked. If I find that I cannot answer any of them in great detail, I shall be very happy to write to him.

I think that these draft regulations will generate a step change in the market for SME finance in terms of competition that could improve not only the amount of finance available to SMEs but also the cost and quality of services that small firms are offered. As I said in my opening remarks, a large body of evidence shows that there are currently market failures in the SME lending market, and these draft regulations will help to remove some of the barriers to entry identified by this evidence.

The noble Lord suggested that we should explore greater credit data sharing, and asked what the Government have done about greater data-sharing for banks and non-bank providers. In fact, the regulations do just that: they apply to the UK’s major banks, which will be required to share data through the CRAs. The BBA and the major banks have been collaborative and supportive in ensuring that these regulations are effective in increasing the amount of data on SMEs that is shared on with finance providers. A footnote in the credit information Explanatory Memorandum or the finance platform Explanatory Memorandum gives the example of the sharing of data on VAT returns. That is another example of the Treasury—HMRC, in fact—consulting on credit and publicly held data.

The noble Lord asked what the Government have been doing to help SME lending with RBS and Lloyds, in which the taxpayer has a large share, albeit diminishing. Although RBS and Lloyds are mainly publicly owned, it was always a feature of that arrangement that operational decisions are not made by Ministers—that was never the Government’s approach. The best way of ensuring that the banking sector, including RBS and Lloyds, is in a position to lend to SMEs is to ensure that the overall economic situation is suitable for that, and that there are good lending conditions. Policies such as funding for lending were also designed to help banks in that regard. We established the British Business Bank to support the development of diverse finance markets for smaller businesses, bringing together

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the management of new and existing schemes into a single commercially minded institution. That bank will manage up to £2.65 billion of existing schemes and deploy a further £1.25 billion on new programmes.

The noble Lord asked why these regulations are being made before the CRA implementation guide is published. The banks and the CRAs, with input from the Government, have put together a technical specification guidance document that is aiding the IT development programmes being undertaken, and which will ensure that banks and CRAs can comply with their obligations. The document is therefore being used effectively and will be published in due course. However, a publication date has yet to be confirmed.

We said in the impact assessment that the benefits cannot be monetised. In it, we tried to put the costs to business and banks and took a conservative position, saying that although we expect the regulations to result in an increase in lending, we would not monetise and take notice of them. So, there may well be a benefit, but we do not take credit for that in the impact assessment. We are trying to give a worst case scenario but we obviously expect there to be a benefit; otherwise, we would not do this. It was simply a question of being sensible and not monetising something that is not definite.

The noble Lord asked why the CRA designation is not compulsory, as it is for the banks. In many ways, the situation with CRAs is the other way round. It is for the benefit of a CRA to be designated and to have available all this data. The issue for the Treasury in designating a CRA is to make sure that it is capable of dealing with and protecting the data. It is therefore important that CRAs be able to show that they can deal with data in line with the data regulations. We want to set the framework by these regulations so that, when the designation due diligence process takes place, we can get the system up and running as soon as possible. This is a framework which will allow the position to take off as soon as the designations are made.

4.15 pm

Lastly, the noble Lord touched on a slightly separate subject, that of late payments. I agree completely with him that this is an important issue which has to be dealt with because it makes the lives of SMEs more difficult. The Government are taking forward a package of measures in both the public and the private sectors to tackle it. As they should, the Government are leading the way by paying 80% of undisputed invoices within five days or within 30 days. Through the Enterprise Bill, the Government are introducing measures currently before Parliament to create a Small Business Commissioner to encourage a change in how businesses deal with each other. We have strengthened the Prompt Payment Code, to which the noble Lord referred, to include a maximum 60-day payment term for all signatories from 2016, along with 95% of invoices to be paid within 60 days unless there are exceptional circumstances, with 30 days promoted as the norm or best practice. The Government are working to increase the number of signatories to the Prompt Payment Code. It was a manifesto commitment to ensure that all major government suppliers sign up to it.

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Representative bodies already have the power to challenge contractual terms which seek to oust or vary a supplier’s statutory right to claim interest on late payments. We will extend the powers that representative bodies have to challenge grossly unfair contractual terms related to late payment in line with the EU late payment directive. We are working on that and we agree with the sentiment behind the noble Lord’s question.

This shake-up of the lending market for SMEs will improve the ability of our small and medium-sized businesses—which are so vital to the UK economy in terms of growth, jobs and opportunities—to access the finance they need to grow, expand and continue making a significant positive impact on the UK economy. I therefore ask the Committee to join me in supporting these regulations.

Motion agreed.

Small and Medium Sized Business (Finance Platforms) Regulations 2015

Motion to Consider

Moved by Lord Ashton of Hyde

4.16 pm

That the Grand Committee do consider the Small and Medium Sized Business (Finance Platforms) Regulations 2015

Relevant document: 4th Report from the Joint Committee on Statutory Instruments

Motion agreed.

Civil Legal Aid (Merits Criteria) (Amendment) (No. 2) Regulations 2015

Motion to Consider

Moved by Lord Faulks

4.17 pm

That the Grand Committee do consider the Civil Legal Aid (Merits Criteria) (Amendment) (No. 2) Regulations 2015.

Relevant document: 5th Report from the Joint Committee on Statutory Instruments (Special attention drawn to the instrument)

The Minister of State, Ministry of Justice (Lord Faulks) (Con): My Lords, the statutory instrument before the Committee today amends the Civil Legal Aid (Merits Criteria) Regulations 2013, known as the “merits criteria regulations”, so that legal aid funding can be provided in some cases where the prospects of succeeding are below 50% but where legal aid funding is required under the European Convention on Human Rights or EU law. These changes have been made to reflect the findings on the legal aid merits test made by the High Court in the recent case of IS.

While this judgment is under appeal—I have had an indication that an appeal will be heard on 25 or 26 April next year—the Government consider it important

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that these amendments are brought into force without delay to provide a means by which the Legal Aid Agency is able to comply with the judgment in the interim. Failure to make such a change promptly would have resulted in an extended period in which the Legal Aid Agency might in some cases either have taken an unlawful decision or indeed have been unable to take any decision. For these reasons, and owing to limited parliamentary time, the statutory instrument before us was made and brought into force using the urgency procedure provided for under the Legal Aid, Sentencing and Punishment of Offenders Act 2012.

The merits criteria regulations set out the merits criteria that must be applied by the Director of Legal Aid Casework at the Legal Aid Agency when determining whether an applicant qualifies for civil legal services under Part 1 of Schedule 1 to LASPO. Broadly speaking, these criteria provide the basis for deciding whether it is justified to provide, or to continue to provide, public funds in an individual case. The factors to be considered are similar to those that would influence a privately paying client of moderate means when considering whether to become involved in proceedings.

Why are the Government taking this action? The merits criteria regulations include a number of different requirements, including a prospects of success test for an application for full representation. When the prospects of success test applies, the regulations generally prevent the Legal Aid Agency funding any case where the prospects of success are below 50%. Had the merits criteria regulations remained unamended, the director would therefore have been placed in something of a bind. Refusing legal aid in some cases would have been an unlawful decision as, on the High Court’s findings, it might have resulted in a convention breach. While the Legal Aid Agency could have sought to delay non-urgent decisions, we did not think it would be reasonable to await the outcome of the Government’s appeal in this matter, which may not be known for some time. Even though the hearings are in April, there may well of course be some delay in producing a judgment.

The amendments made by this instrument mean that, in cases where an application for full representation is subject to an assessment of its prospects of success, legal aid may now be provided for some cases assessed as having “borderline” or “poor” prospects of success. The director will need to be satisfied that it is necessary to determine or, in the case of a risk of a breach, appropriate to determine that the prospects of success test is met in order to prevent a breach, or the risk of a breach, of the legal aid applicant’s rights under the convention or enforceable EU rights.

A discrete point arises. The Joint Committee on Statutory Instruments, or JCSI, has expressed its views on the clarity—or, more accurately, the lack of clarity—in respect of the transitional provisions in the SI. I apologise to the Committee for any confusion that may have been engendered; the department intends to develop a revised drafting approach—resulting, I hope, in greater clarity—to be used in future that is more closely targeted at solely those cases that begin

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before commencement. However, we consider that the transitional provisions in this instrument still operate to achieve the policy intention.

This instrument makes important and necessary amendments to the merits criteria regulations to ensure that legal aid will continue to be provided in any case where refusal to grant would be unlawful. It does so while maintaining the underlying purpose of the civil legal aid eligibility criteria and the legal aid scheme—that is, to make sure that the limited legal aid budget is directed at the cases which most justify public funding. I therefore commend this statutory instrument to the Committee, and I beg to move.

Lord Bach (Lab): My Lords, I shall be extremely brief. I thank the Minister for his very clear outlining of these regulations. I can tell him and the Committee at once that the Opposition do not oppose it—indeed, we support it. I thank him for his generous apology regarding the points made by the JCSI. The regulations are clearly a sensible step for Her Majesty’s Government to have taken following the High Court judgment. The Government are appealing that decision, and we are grateful to the Minister for telling us the date. I gather that it was a fixed date for the hearing. The Minister and I know that those dates can change, however fixed they may or may not be. If the appeal is unsuccessful, will it be the Government’s intention to change the criteria by legislation? Our advice, for what it is worth—and if the Government are interested in any way—is not to do so. We welcome the regulations.

Lord Faulks: I am grateful to the noble Lord for his observations and for the advice that he so generously offered on behalf of Her Majesty’s Opposition. Of course, depending on the outcome of the case, one side or another might consider it necessary to pursue the matter further to the Supreme Court, were permission to be obtained, but in due course a decision will follow that judgment and we will decide whether or not to proceed with the matter.

I have been given an amended date, I am afraid to say. I wrongly informed the Committee that it was April, but the better news is that it has been brought forward: the date is now 21 or 22 March 2016, but of course that will be subject to the provisos so accurately identified by the noble Lord, Lord Bach.

Lord Bach: If we allow this to carry on for a bit longer, do you think that the date may get closer and closer?

Lord Faulks: I am grateful for that interruption. Who knows? But we are at least moving in the right direction, I am glad to say.

I am grateful for the general acknowledgement of the sense of these regulations, and I thank the noble Lord for that. I believe this to be an appropriate instrument that makes the necessary amendments to the merits criteria regulations in order to comply with the judgment pending the appeal.

Motion agreed.

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Civil Legal Aid (Merits Criteria and Information about Financial Resources) (Amendment) Regulations 2015

Motion to Consider

4.26 pm

Moved by Lord Faulks

That the Grand Committee do consider the Civil Legal Aid (Merits Criteria and Information about Financial Resources) (Amendment) Regulations 2015

Relevant documents: 8th Report from the Joint Committee on Statutory Instruments

The Minister of State, Ministry of Justice (Lord Faulks): I beg to move that the Committee has considered the draft Civil Legal Aid (Merits Criteria and Information about Financial Resources) (Amendment) Regulations 2015.

The statutory instrument before us today amends the Civil Legal Aid (Merits Criteria) Regulations 2013 to specify the merits criteria that must be met in order to qualify for civil legal aid for applications for post-adoption contact. This statutory instrument also makes amendments to the Legal Aid (Information about Financial Resources) Regulations 2013—the information regulations. The amendments provide that the director of legal aid casework at the Legal Aid Agency may make an information request to the relevant Secretary of State to find out whether a legal aid applicant is in receipt of direct payments for special educational needs or direct payments under Section 17A of the Children Act 1989. That information is relevant for the purposes of the means assessment that the director must carry out.

Orders for post-adoption contact were introduced by the Children and Families Act 2014, which inserted Sections 51A and 51B into the Adoption and Children Act 2002. Applications can now be made for a post-adoption contact order when the court is making an adoption order or when an adoption order has been made. These provisions came into effect on 22 April 2014. The Children and Families Act 2014 also amended Part 1 of Schedule 1 to LASPO. This means that legal aid may be available for any application for post-adoption contact where the person applying for legal aid provides evidence of domestic violence or child abuse or where they are a child who is a party to the proceedings.

Why is this necessary? As I have already mentioned in this Committee today, the merits criteria regulations set out the merits criteria that must be applied by the director of legal aid casework at the Legal Aid Agency when determining whether an applicant qualifies for civil legal services under Part 1 of Schedule 1 to LASPO. Regulation 2 of the merits criteria regulations sets out the interpretation and definition of terms used within those regulations. This instrument adds certain civil proceedings in relation to post-adoption contact orders to the definition of “private law children case”. As a result, the merits criteria which apply to such proceedings when determining an individual’s eligibility for legal representation will be those set out in Regulations 64 and 68. This means that some

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elements of the standard merits test will not apply, such as the requirement for the case to be unsuitable for a conditional fee arrangement.

Separately, Regulation 69 of the merits criteria regulations sets out the criteria for determinations for legal representation in relation to family cases to which specific merits criteria apply, other than those specifically provided for elsewhere in the merits criteria regulations. The amendments made by this instrument will also exclude from the scope of Regulation 69 determinations in relation to certain post-adoption contact order proceedings. This exclusion is necessary because, as I mentioned, the applicable criteria for such matters will be those in Regulations 64 and 68.

4.30 pm

Turning to the amendments to the information regulations, where a child has a special educational need they may be eligible for an education healthcare plan, which brings a child’s education, health and social care needs into a single, legally binding document. Cash payments may be made directly to the child’s parent or guardian, the young person or their nominee, allowing them to arrange provision of necessary services such as transport, as identified in the individual’s plan. These direct payments are currently made under the Special Educational Needs (Personal Budgets) Regulations 2014, made under Section 49(3) of the Children and Families Act 2014. Direct payments may also be made under Section 17A of the Children Act 1989 to parents of disabled children, a disabled person with parental responsibility for a child or disabled children aged 16 or 17 to meet their assessed needs.

These direct payments are disregarded for the purposes of a legal aid financial eligibility assessment following amendments previously made by the Legal Aid, Community Legal Service and Criminal Defence Service (Amendment) Regulations 2015, which came into force on 13 April. Therefore, these direct payments are not included when calculating a person’s disposable income.

Why is this necessary? The information regulations give the director of legal aid casework the power to request information from the relevant Secretary of State about a prescribed benefit an individual is receiving, in order to make a financial assessment of legal aid eligibility. The Government intend that the director should be able to make an information request to the Secretary of State to find out whether a legal aid applicant is in receipt of direct payments that are disregarded for the purposes of the legal aid financial eligibility assessment. The amendment to the information regulations will enable the director to make such a request.

The statutory instrument makes relatively minor but important changes to the civil legal aid scheme to provide for the application of specific merits criteria when determining a person’s eligibility for legal aid for applications for post-adoption contact—a relatively new concept—and to provide for efficiency in the assessment of legal aid eligibility through the power to make information requests. In those circumstances, I commend the statutory instrument to the Committee and beg to move.

Lord Bach (Lab): My Lords, I again thank the Minister for his clear outlining of both parts of this regulation. I must tell the Committee that we, on

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behalf of the Opposition, welcome this regulation in both its parts. It is slightly worrying for the Opposition to agree to two regulations, one after the other, concerning Part 1 of LASPO. The Minister knows very well that we think LASPO has been an absolute disaster, certainly as far as Part 1 is concerned and as forecast by many Members of this House.

However, this is not the occasion to debate Part 1 of LASPO in general terms. I know the Minister will be looking forward as much as I am to the debate on Thursday 10 December on the future of legal aid—it is something he may not be aware of, but it will be a thrill for him to come to it. These regulations seems perfectly sensible. We have taken some advice on the effects of the two parts and they seem extremely sound. We are happy to support them.

Lord Faulks: I am very grateful to the noble Lord for his comments on the two parts of this statutory instrument. I look forward to the debate on 10 December —it comes as news to me, but no doubt I would have been informed in due course—if I am lucky enough to respond to that report on the Government’s behalf. I know that the noble Lord has been assiduous in his opposition to Part 1 of the LASPO Act. I noticed that he did not mention Part 2, to which there was also opposition, but that seems to have rather faded away. However, that is a debate for another day and we look forward to engaging in it.

In the mean time, I respectfully say to the Committee that the instrument makes important and necessary amendments to the merits criteria regulations to ensure that legal aid will continue to be provided in any case where refusal would be unlawful. It does so while maintaining the underlying purpose of civil legal aid eligibility criteria and the legal aid scheme, which is to ensure that the limited legal aid budget is directed at the cases that most justify public funding. I therefore commend the statutory instrument to the Committee.

Motion agreed.

Police: Report of the Committee on Standards in Public Life

Question for Short Debate

4.35 pm

Asked by The Earl of Lytton

To ask Her Majesty’s Government what proposals they have to improve police leadership, accountability and ethics in the light of the report of the Committee on Standards in Public Life Tone from the top.

The Earl of Lytton: My Lords, I am delighted to introduce this short debate on the report of the Committee on Standards in Public Life, entitled Tone from the Top. My interest in police accountability is not original. It started with Lord Corbett of Castle Vale and his researcher, and the fact that I was able to source a PhD paper from one Dr Roger Patrick, which delved into all sorts of matters on the reporting of crime. I then

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raised the issue before the House in a short debate in March 2013. Subsequently, the Public Administration Select Committee looked into the matter. Following that, the Committee on Standards in Public Life made its investigation and report. I am delighted that the author of that report, the noble Lord, Lord Bew, as chairman of the Committee on Standards in Public Life, is with us. I congratulate him on his committee’s report.

I continue by declaring what I believe is an important matter: the fundamental importance of policing in this country. It is a vital first service. It must command the confidence of the public at large, of business and of government. I pay tribute to the many officers who willingly face danger in the interests of protecting the public. There remains a high level of public confidence and support, even though it has taken a bit of a hit over recent years because of a number of high-level failings and revelations referred to in the noble Lord’s committee’s report. Stories continue to come out weekly, if not daily.

Responsibility for checking crime recording is claimed by Her Majesty’s Inspectorate of Constabulary, so it is unsurprising that following the Public Administration Select Committee’s report, the Committee on Standards in Public Life turned its attention to the means of accountability set up under the coalition Government—namely, the police and crime commissioners and the panels that work with them. The Home Affairs Committee described this as the creation of,

“a system that relies on local scrutiny and the main check is at the ballot box”.

It also remarked that this comes round only every few years.

Since their creation, several factors have come to light. First, it is fair to say that there has been a bit of a democratic deficit in terms of poor voter response. That feature has not been improved on in subsequent intermediate elections for replacement PCCs. Secondly, many of the police and crime commissioner candidates came from party-political backgrounds. From my own standpoint—from where I sit in the House—I think that a greater degree of political neutrality would have been more appropriate.

Thirdly, some PCCs came to their posts with a history of police or allied area involvement. In some cases it appeared that this might—and in some cases did—impede their role of holding a chief constable to account. Fourthly, while PCCs have a sanction against the chief constable, this may not drill down to the culture of policing in the middle ranks. Example may be from the top, but leadership deficits pointed to by others may mean that this does not permeate through the force, leaving some cultural practices effectively unchanged and unchallenged. Fifthly, PCCs, and indeed their panels, seem to have had a reluctance to challenge anything remotely associated with what the police might choose to claim to be operational matters. I note that the CSPL report comments on the reluctance of one PCP to cross that line.

In respect of police and crime commissioner performance, the report makes some significant recommendations, which I shall paraphrase because I know that the noble Lord, Lord Bew, will want to

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flesh some of them out. They fall into the areas of standards, evaluation, sanctions, disclosure and transparency, objectivity in dealing with complaints and safeguards in appointment procedures.

Although the intention was that PCCs would better hold the police to account, that was never the only mechanism. Her Majesty’s Inspectorate of Constabulary, the Independent Police Complaints Commission, the College of Policing, the Home Office, parliamentary committees and so on all have a role to play, but it seems to me that none of the issues of “gaming” of crime figures, which I referred to back in 2013, has gone away. Dr Rodger Patrick—yes, the same one—tells me that it is continuing. He believes that it is institutional and, having seen some of his evidence, I have to agree with his interpretation.

Even HMIC seems to admit that police under-recording of crime may be significant, but then it gave the West Midlands force an improbably high approval rating of 99% for its recording procedures. However, at the very time that it was carrying that out audit, circumstances were unfolding which led to the eventual murder of Jacqueline Oakes in January 2014. Apparently the force knew about Ms Oakes’s killer and the history of violence and abuse. It seems that the IPCC has now served notices on 26 serving officers, seven police staff and two officers who have left the force in connection with this case. This suggests an institutional issue and a failure to record information—the precise factor that HMIC was supposed to audit. I am told that, subsequently, the West Midlands PCC examined 13 domestic homicide reviews from that force and found that in more than half of them there was a failure by the police to take robust action. So, even had incident reporting been as good as HMIC suggested, the resultant action was defective.

Middlesex University reported on West Midlands’s domestic homicide reviews in July 2014. This found that the process remained less than joined up, with many stakeholders, different and poorly integrated areas of focus and an absence of holistic management. Dr Patrick, whom I regard as a great expert on crime recording and statistics, has pointed out that the HMIC methodology of auditing forces’ performance is weak. Of course, we will probably never know whether these factors contributed to the death of Ms Oakes.

There is a line in the sand on the question of oversight of police operations. The definition of “operations” as a term of art matters and is based on understandings that go back to the 1920s or earlier. The details of response to an emergency, the sources of information used to disrupt criminal activity and the methodologies for apprehending wrongdoers would of course qualify as being operations. However, there has to be transparency and accountability by the police. If, as I apprehend, freedom from interference in operations can in certain circumstances translate in modern terms into a denial of any oversight rights at all, I think it is time to redefine what is or is not “operational” in this context.

In a conversation today with one of the police force deputy commissioners, other issues came to light, particularly in connection with youths in custody, where there are few, if any, common protocols linking the police activity with that of local authority education or social services departments. Furthermore, it seems

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that there are no protocols setting out the respective areas of activity of HMIC and IPCC and how these interleave. If either had a clear road map of their scope and activities, such a protocol would be unavoidable. So on one level agencies defend their turf vigorously; on others, there is unnecessary overlap; and, on a third, there are some significant gaps which erode confidence and ruin, degrade and may even cost lives.

My point is this: all the regulators of the police—police and crime commissioners, HMIC, the IPCC, the College of Policing, the Home Office and so on—are themselves to a degree embedded with policing, and I wonder whether this does not in some circumstances interfere with true independence and objectivity in holding to account those who need to be held to account. For their part, police and crime commissioners walk a tightrope: they need to work with their chief constable in a collaborative manner but yet be able to take the ultimate sanction if need be. But they can only be as good as the performance of other regulators permits.

I finish, with his consent, with a quote from the speech by the noble Lord, Lord Bew, at the annual Newsam Memorial Lecture 2015 hosted by the College of Policing. He said:

“It is no good preaching principles and codes in an organisation if, for example, promotions, pay and other incentives actually encourage something quite different. A number of investment banks had exemplary statements of values. But what was actually rewarded in them, right up to their chief executives, was excessive risk-taking and the pursuit of profit at the expense of customer service”.

So ongoing indifference, acquiescence, rewarding poor performance, an administrative Nelson’s eye, if you like, and poor leadership remain. Indeed, Tone from the Top is a prophetic title. This matters. Confidence in the forces of law and order and the cohesion of society are at stake—as, ultimately, is the rule of law. That is why this report is important for what it says and what it infers, and why it requires government attention.

4.45 pm

Lord Blair of Boughton (CB): My Lords, I am very grateful to the noble Earl for bringing forward this debate. I declare my interests in policing and as the drafter of the first police code of ethics in 1991.

The report is extremely good and I read it with great interest. I agree with many of its conclusions. The three that I would particularly note are the call for a mechanism for removing police and crime commissioners, of which there is not one; the weaknesses of the police and crime panels, especially to acquire information; and the call regarding chief constable selection processes. There is also something in the confusion of roles between the PCC and the chief officer. One of the most interesting places that that occurs—it is obvious that it is occurring—is around who talks to the press after a major incident. In some places it is the PCC; in some places it is the chief constable. One of these days, the PCC is going to find themselves caught up in an inquiry because of what he or she said at a press conference. That is just a general point.

What I looked for in the report and did not find is the issue of the power of the PCC to dismiss a chief officer. I want to elaborate on that in my short speech.

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Mechanisms are clearly laid out in statute for the dismissal of a chief officer found guilty of gross misconduct. That is a pretty obvious requirement in any disciplinary process. But what is missing is the understanding of how it is possible to remove a chief officer merely by making a public statement. That is the crucial point. In other words, a public statement by a PCC to say, “I have lost confidence in this officer”. That is what has happened on more than one occasion.

It is exactly the same as—and I will put this in the most objective manner I possibly can—my slight disagreement with the current Mayor of London. If you look at what was then the Greater London Authority Act, you will see that there were pages and pages on how to remove a commissioner or deputy commissioner, but that was not the route that Boris chose. He chose to threaten that he would have a vote and declare a vote of no confidence, as he put it, “because I have the numbers”.

I merely say that it seems to me that the Government—in concert perhaps with the National Police Chiefs Council and the Chief Police Officers Staff Association, if it still exists—should produce some guidance that actually says that a chief constable can only be publicly called upon to step down after a disciplinary sanction and only with the prior consent of a police and crime panel. That is prior consent, not subsequent. The reason for saying “public” is because in any organisation the person in charge has the right to wander into the room, sit down with somebody and say, for instance, “Gordon, it is time to go”. That is a private conversation which continues, “I think that this is getting worse and it is time for you to go”. I have no qualms about that—but if someone stands in front of the town hall saying, “I have no confidence in the chief constable”, that leaves the chief constable with absolutely nowhere to go. The problem with that are the implications.

The implications are that, for the very first time in England and Wales, a chief constable answers to one person, and one person alone. That would make you pretty cautious. Are you going to be cautious about things where you make a professional judgment but PCC wants something very different? How many times are you going to argue with the PCC, and then insist on your operational independence, before you start getting a cold feeling between your shoulders? This is a terribly important issue. A chief officer, like any other chief executive, is appointed to do things that he or she believes in, and they should be able to pursue them after rational debate, even against the views of the PCC. At the moment, there is a danger that they might not. They also might decide not to investigate the friend or relative of a PCC. When I was commissioner, we investigated the Prime Minister. There is a freedom which it is necessary for the police to have, and one-to-one relationships require even more care than when answering to a committee or a police authority.

The second point I want to add is this. What is the long-term effect of this on the young men and women who are currently passing through the strategic command course at the Police Staff College? I think that some of them might be on it right now. They face an average

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period of seven or eight years before they become chief constables, and they will pass through the ranks of assistant and deputy chief before doing so. They are now going into that knowing that, for the next seven or eight years, they will watch how their chief operates with the PCC. My fear is that over those years they will watch chief officers make less good decisions because they are afraid of losing their jobs. They are afraid of losing their jobs not over a matter of discipline but because of how a decision is taken by the PCC to remove the chief without just cause. That is potentially a very worrying thought. What will be the mindset of aspirant chief constables in eight years’ time if they are brought up in a place where they are vulnerable?

The reason that this is particularly difficult is that to some degree the model for it comes from the United States. The most famous example is Bill Bratton being sacked by the mayor of New York for appearing on the front cover of Time magazine as the man who saved New York, whereas the mayor thought that that was his job. The difference is that in America people move from police force to police force after having been removed in that way. There is no detriment and Bill Bratton is back. That is not possible over here. If you lose your job, you lose your reputation and your pension.

4.53 pm

Lord Wasserman (Con): My Lords, I, too, wish to thank the noble Earl, Lord Lytton, for initiating this debate. The noble Earl has had a long interest in policing generally and in the integrity and accountability of police leaders in particular. It is no surprise, therefore, that he has pressed for a debate on this important report on his specialist subject. I also congratulate the noble Lord, Lord Bew, and his committee on having decided to turn their attention to policing and on producing a report on this subject which is substantial, not only in size but also in content.

Police leadership, ethics and accountability have been very much in the news in recent years. Hillsborough and the Stephen Lawrence case continue to attract attention, although the events to which they refer occurred decades ago. Moreover, those issues show no sign of going away. As recently as last Saturday morning, the media were full of stories about the leadership of the Metropolitan Police having to apologise publicly for the behaviour of undercover officers who had “violated the human rights” of women with whom they had had relationships in circumstances which the Met had to admit were a blatant “abuse of police power”.

So it is not surprising that the Committee on Standards in Public Life, whose mission is to advise the Prime Minister on ethical standards across the whole of public life and to monitor and report on issues relating to the standards of conduct of all public officeholders, should have decided that the time had come to turn its attention to policing. The only surprise about that decision is that it took it so long to get around to it. The committee was established more than 20 years ago and this is its 15th report. I should have thought, given the critical importance of honesty, integrity, openness and impartiality in policing, and the public’s

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concern about how far the police actually incorporate these values in their day-to-day activity, that the committee would have put the police several places higher on its priority list for review. Be that as it may, I am delighted that the committee finally focused on this important public service and I join other noble Lords in congratulating the noble Lord, Lord Bew, and his committee.

At the end of what appears to have been a very thorough and comprehensive review of the leadership, ethics and accountability arrangements in our 43 local police forces, the committee came up with 20 main recommendations, several divided into sub-recommendations. There is not nearly enough time in this very short debate to deal with all or even most of these recommendations. All I intend to say is that while I support most of them, there are a few which I feel are a bit too prescriptive and others where I feel that the committee has not been prescriptive enough and has taken the easy way out by passing the buck to the Home Office to put things right.

For example, chapter 5, where the committee discusses the accessibility to the public of information about the performance of their police force, says:

“The public needs to access information to scrutinise the performance of their local police force and to hold the PCC to account”.

Who could possible object to this statement of the obvious? However, when it comes to recommending how this openness should be encouraged and monitored, the committee makes no proposals of its own but simply endorses the recommendation of the National Audit Office that the Home Office should report on how it plans to increase data availability and accessibility to help the public hold PCCs to account. I found this rather disappointing, to say the least.

Sadly, it is not the only case in which the committee deals with a difficult issue by handing it off to the Home Secretary for action. I would not have bothered to highlight this aspect of the committee’s recommendations if I did not think that it reflected what I regard as an important misunderstanding about the way local policing is presently organised. In short, I feel that the committee, by putting forward recommendations of this kind, has either not understood, or perhaps not quite accepted, the world of local policing as it is following the coming into force of the Police Reform and Social Responsibility Act 2011—that is, the world of local policing post the introduction of PCCs. In this world, whether we like it or not—I know that many noble Lords do not like it at all—it is the responsibility of PCCs, among other things, to provide adequate information about the performance of their forces and it is up to the public, either through the ballot box or through community groups or specialist organisations such as CoPaCC, mentioned in the report, to ensure that they do.

Even the National Audit Office recognises this. In the third paragraph of this report’s admirable executive summary, the committee quotes with approval the NAO’s statement that the present model of local policing is one of “democratic accountability” in which,

“the public will have elected Police and Crime Commissioners and will be holding them to account for how policing is delivered through their force”.

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It could not be clearer, so I do not for a moment believe that the Home Office has no role to play in local policing—far from it. I believe strongly that the Home Office has a vital role to play in local policing, for example, by ensuring that the laws on our statute books reflect the evolution of criminal behaviour; by establishing and maintaining strong national policing agencies to tackle crimes such as human trafficking, cybercrime and economic crime, which cannot be tackled effectively locally; and, of course, by arguing the case for local policing when public expenditure totals come to be distributed between competing public services. But when it comes to most of the issues discussed in this report, the buck must stop with the people directly elected to deliver policing services to their communities. They have the power; they must be held accountable for using it.

Devolution of power to local level does not always work as we would like it to. It is always easier to blame central government for everything that goes wrong locally. But giving local communities responsibility for the professional men and women employed to meet their policing needs must be right. We must give it time to work.

5 pm

Lord Bew (CB): My Lords, I am very grateful to the noble Earl, Lord Lytton, for initiating this debate and, even more than that, for the work he carried out which first drew my attention to the key issues of leadership in modern policing. Some three years ago the noble Earl initiated a major debate on police statistics. That was before it became pretty fashionable or commonplace to read newspaper headlines saying that police statistics are maybe not cast in gold and that there might be some problems with them. Long before that, the noble Earl led the way in this Room, basing himself in part of course on the work of Dr Patrick—as he would say himself. That gained my interest.

I agree completely with the noble Lord, Lord Wasserman, that the Committee on Standards in Public Life had been in existence for too long without looking at policing, given our remit. My first intention was to look at the statistics. I discussed this with the chairman of PASC and he became very interested, too. In the end, PASC reported in the autumn of 2013 on policing statistics, and the first document from the committee under my chairmanship was a submission to that report. The PASc report ends by saying to us, “Again, would you look at questions of leadership and policing?”. That is what we have tried to do.

It almost pains me to say something so simple about the debate around PCCs but I have one strong idea in mind: even in our best quality newspapers, there has not been a serious discussion about how this major experiment, whether you like it or not, is working out. Either X was wonderful and transformed the sensitivity of the police to crimes against women in their area, or X was a total idiot. That is all you get in one headline after another, with no systematic attempt to look at what this means. PCCs were a major attempt to place the local principle at the heart of our policing and a major transformation, so our idea above all else was to try to produce a balanced and sober report.

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I accept the point of the noble Lord, Lord Blair, from a position that I well understand, that there is an essential lacuna—from his point of view, a lack of sharpness—in the report. I also accept the point of view from the noble Lord, Lord Wasserman. However, our approach was to try and raise the quality of the debate. One reason I am so happy about the debate today is that the Committee on Standards in Public Life has a new practice in that we do not just produce a report. We come back at the end of a public debate, as we did on our most recent report last summer, and produce a follow-up. Many things have been said today from all parts of the Room that are of great seriousness and will be reflected in the follow-up report.

While we found a great deal that was positive—greater innovation, visibility, and focus on community engagement and victim support—we also found clear evidence of standards risks in the new experiment: confusion over roles; insufficient challenge and scrutiny; and insufficient redress where PCCs fell below the behaviour expected of them by the public. I am anxious to hear the Minister’s views on the particular recommendations our committee made.

We recommended a national minimum code of conduct for PCCs. That is an essential component in ensuring clarity as to the standards of conduct and behaviour expected from PCCs, and to give the public—to whom they are accountable—a common yardstick to judge acceptable conduct. We also suggested a review of the current powers, and that the Home Secretary should urgently review whether there are sufficient powers available to take action against a PCC where conduct falls below the standards expected of public officer-holders. In our view, those standards are always defined by the known principles of public life.

The committee considers the introduction of a power of recall a matter for Parliament, but believes that should this power be introduced for PCCs, commonality relating to the thresholds and triggers to initiate recall is required. In other words, we accept that this is a complicated message. As far as I understand some of the public remarks from the Home Secretary, she acknowledges that if you have recall for MPs, there is an analogy that there should be recall for PCCs. We understand that argument, but we want to ensure that it is done with precision and fairness.

I concede that it is now the very short term with the elections coming up in 2016, but an idea the committee is keen on is the circulation of an ethical checklist to all declared candidates for a PCC post, with a request from the committee for each candidate to publish their responses. We will encourage relevant local media outlets, whether print, broadcast or social, to seek out and publicise their candidates’ responses. For us, accountability should not simply be an issue at four- yearly election intervals. We need greater scrutiny and transparency of PCC’s decisions between elections. The public must be able to make fair and balanced assessments of this very important new experiment.

There is one other thing that we did not see, apart from the points so cogently made this afternoon. We did not expect the number of resignations by PCCs. As a practical matter, I am not now saying that there is a solution to this. I simply acknowledge that it is

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something that we did not expect at all from our visits—and we talked to lots of PCCs around the country. It is not something that can be solved by the application of the Nolan principles, but it is a matter of significance.

5.06 pm

Lord Paddick (LD): My Lords, I also thank the noble Earl, Lord Lytton, for the debate. I note his comments about crime figures being underrecorded by the police—was there ever a greater case of shooting yourself in the foot, bearing in mind the justification that the Government have given for reducing police numbers by so great an amount is the drop in crime?

I have a great deal of sympathy for what the noble Lord, Lord Blair of Boughton, said about the way his career came to an end, which I think was entirely inappropriate. As far as the noble Lord, Lord Wasserman, is concerned, the report majors on holding PCCs to account. I am very grateful to the noble Lord, Lord Bew, not only for the report but for raising that as an issue, because I want to concentrate on concerns with the police and crime commissioners, rather than concerns with police leadership.

In 2010, the Liberal Democrats raised concerns about PCCs. We had concerns about concentrating so much power in one individual. As an alternative we suggested that, where police authorities were co-terminus with local authority areas, the police authority should be made of the local elected councillors. Where they were not, there should be directly-elected police authorities, but not just one individual. In particular, concerns are highlighted in the report about the hiring and firing of police constables, the transparency of the selection processes and the ability to hold the police and crime commissioner to account when their conduct falls below the standards expected of them but short of criminal conduct.

I will illustrate the report’s abstract concerns by reference to a real-life example. A police and crime commissioner selected and appointed a chief constable to head their force. Some time after appointment, serious allegations of misconduct against the chief constable were reported to the PCC by a whistleblower. The allegations were of a sexual nature, involving the alleged abuse of authority, with the chief constable using his position, as both the chief constable and a man, to behave in inappropriate ways towards female staff. Because the chief constable had only recently been appointed by the PCC, there was clearly potential for the allegations to cast serious doubt over the judgement of the PCC in appointing the chief constable in the first place.

It has been brought to my attention by some of those involved that this confidential report of serious misconduct, including the name of the whistleblower, was passed to the chief constable by the police and crime commissioner. Those who brought the matter to my attention felt that, as the PCC was elected, and because of the sensitive nature of the allegations and the impact on the victims if their identities were made public, there was nothing they could do about what they considered to be the entirely inappropriate behaviour of the police and crime commissioner.

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Eventually the allegations against the chief constable were formally recorded and investigated, and findings against him were made, short of requiring him to resign. Only after relentless pressure, mainly from his own officers, whose representative organisations, rather than the PCC, said they no longer had confidence in him, did the PCC finally agree to start the proceedings that would result in requiring the chief constable to resign. Eventually he did resign of his own volition.

Apart from the question of lack of judgment by the PCC in the first place, there are serious questions about her conduct—such as the leaking of confidential information about the identity of the complainants to the perpetrator—that have still not been addressed. This report by the Committee on Standards in Public Life queries the robustness of the selection of chief constables by PCCs, the effectiveness of police and crime panels in holding the police and crime commissioner to account, the confused complaints system in relation to PCCs, the lack of a code of conduct for PCCs, and insufficient powers to take action against PCCs whose conduct falls below the required standards.

Those are not abstract or theoretical concerns. As I have outlined in this one case, of which I have some detailed knowledge, the whole system by which PCCs work together with chief constables, how they are appointed and how they are then held to account and disciplined is, in my opinion, flawed. As the report highlights, because there is only one person holding the chief constable to account—in an increasing number of cases, the same person who appointed that chief constable—the relationship between the chief constable and the PCC in terms of their combined skills, their experience and their personalities becomes critical.

Do the Government not accept that, with the best will in the world, even if we have the codes of conduct and an independent element in the chief constable appointments process—as the report recommends—and a clear understanding of operational independence and effective measures to hold an elected police and crime commissioner to account, is having only one person responsible for selecting the chief constable and co-operating with the chief constable to deliver politically critical goals, for holding the chief constable to account and for sacking the chief constable really a workable system? I raise that not as a theoretical question but in relation to the case that I have outlined to the Committee this afternoon.

5.13 pm

Lord Rosser (Lab): My Lords, I, too, extend my thanks to the noble Earl, Lord Lytton, for securing this short debate, which enables us to consider the valuable and timely report of the Committee on Standards in Public Life on leadership, ethics and accountability in policing. It has been particularly helpful to have heard in this debate from the chair of the committee, the noble Lord, Lord Bew.

The creation of police and crime commissioners and the associated governance arrangements has clearly been the driving force behind the committee’s decision to undertake this report, which is the first one in the committee’s history that has looked specifically at policing. As the report says:

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“Trust in the police is vital—from the Chief Constable to the most junior police officer. Police ethics—their honesty, their integrity, their impartiality, their openness—should be beyond reproach … High standards—of both conduct and accountability—also need to be demonstrated by those charged with holding the police to account”.

I believe that, for the overwhelming majority of time, the police achieve the standards required of them —a view supported by the survey undertaken for the committee. However, any straying from those standards must be a cause for concern.

The report does not deal with issues relating to the impact on police officers of cutbacks in staffing, but it would be unrealistic to imagine that poor morale among officers, chief constables and the Metropolitan Police Commissioner in expressing concerns about the impact on effective policing and police numbers of further projected financial cuts, at this of all times, and a Government who have created uncertainty over intended changes in the police funding formula, does anything at all to promote or enhance the kind of culture or standards in policing referred to in the report. I hope that, in considering this report, the Government have taken and will continue to take a look at the impact of their decisions and decision-making on leadership, ethics and accountability in policing.

In his foreword to the report, the noble Lord, Lord Bew, states in respect of police and crime commissioners that there has been evidence of a,

“new impetus in many areas—greater innovation, increased visibility and a greater focus on community engagement and victim support”.

However, he then goes on to say that,

“there is also clear evidence of significant standards risks, including continuing confusion over roles and responsibilities, insufficient challenge and scrutiny of PCCs’ decisions and insufficient redress where a PCC falls below the standards of behaviour that the public expects of a holder of public office”.

A great many, if not all, of the issues referred to by the noble Lord, Lord Bew, were raised and, I would have to say, largely dismissed, by the then coalition Government during discussions on the Police Reform and Social Responsibility Act 2011. At that time, the Government’s attitude was to get the Bill through as quickly as possible and then hold elections for police and crime commissioners with their very considerable, relatively unchallenged powers, as has already been said, irrespective of how few people might vote in the elections. Detailed considerations on what would be appropriate structures, roles and responsibilities, checks and balances and effective and necessary governance arrangements did not appear to have the same priority.

This report by the Committee on Standards in Public Life forms a basis for a proper discussion of some of these issues, at least where they relate to the role and functions of the committee. I hope that it is an opportunity that the Government either are taking or will take. However, the omens are not all positive. In a parliamentary Written Answer a month ago, in response to a question about the effectiveness of police and crime commissioners, there was no mention of any of the specific issues that had by then been raised in the report by the Committee on Standards in Public Life or, indeed, of any government consideration being given to those issues. Presumably, the Minister will give a government view on the committee’s

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20 recommendations —not least, those that seek to address the “significant standards risks” identified by the committee, including a,

“confusion amongst the public and the participants about roles and responsibilities, especially in relation to where operational independence and governance oversight begin and end … a significant absence of a clear process to take action against a PCC whose conduct falls below the standards expected of public office holders, resulting in that behaviour going unchallenged and uncensured … concerns about the robustness of current selection processes for chief officers … PCCs not encountering sufficient constructive challenge or active support in exercising decision making powers … barriers to the effective operation of Police and Crime Panels as scrutinisers including support, resources and the consistency and credibility of representative membership … a lack of timely and accessible information being provided to Police and Crime Panels by PCCs affecting Police and Crime Panels’ ability to scrutinise and support the PCC”,

and,

“potential for high risk conflict of interests in roles jointly appointed by PCCs and Chief Constables … and risks inherent in the combined role of Chief Executive and Monitoring Officer to the PCC”.

Those issues were all raised in the report from the Committee on Standards in Public Life.

It also referred to confusion between and inherent tensions in the current police complaints system and the complaints system attaching to PCCs, and a gap in the expectations of the public in how complaints against PCCs would be resolved, especially when this involves unethical but not criminal behaviour. The Committee concluded that, combined, the factors to which I have just referred also impacted on the ability of police and crime panels to ensure—it is part of their role—

“that decisions of PCCs are tested on behalf of the public on a regular basis.”

Like other noble Lords who have spoken, I look forward to the Government’s response, which I hope will promote rather than shut down further debate, bearing in mind that the current police model is the one the present Home Secretary introduced and presumably felt would work effectively.

5.20 pm

The Minister of State, Home Office (Lord Bates) (Con): My Lords, it is a pleasure to respond to this debate on behalf of the Government. I thank the noble Earl, Lord Lytton, for raising this important issue, and congratulate him on securing the debate. Over many years the noble Earl has raised the issue of improving the accountability and transparency of our police forces, particularly in relation to the recording of crime statistics. Although it sometimes makes the Home Office uncomfortable, the whole policing service and the whole Government appreciate his scrutiny, his interest in the minutiae and the rigour he brings to the very important area of maintaining public confidence in the data we have. I also thank all noble Lords who have spoken in the debate.

The noble Earl framed the debate around the Committee on Standards in Public Life’s report on the leadership, accountability and ethics of local policing. I take this opportunity to thank the Chair of that Committee, the noble Lord, Lord Bew, for the work he

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and the Committee undertook to draft that report. I was particularly pleased to note the Committee’s observation that police and crime commissioners have brought

“new impetus in many areas - greater innovation, increased visibility and a greater focus on community engagement and victim support”.

On page 24 there is a very interesting statistic about the level of awareness. A survey carried out for the Committee found that 68% of people surveyed in 2014 had heard of their PCC. That is quite an impressive number, certainly when compared with the very low numbers that knew about the predecessor chairman of the police committee. The fact that there is greater interest in and scrutiny of the role must show that growing awareness. I am aware that several noble Lords questioned the awareness of PCCs and their democratic legitimacy. Of course, they were elected by 5.8 million people who expressed a view and turned out to vote. We believe that that number will be significantly higher when elections are held next year, not least because the role is becoming more established. For all those reasons, it is critical that the issue of ethics and integrity is at the heart of the deliberations.

The Committee’s report contains many thought-provoking observations—20 in total. The noble Lord, Lord Bew, wrote to my right honourable friend the Home Secretary on 27 June, following the publication of the report, and requested that the Home Office respond by the end of November. I can confirm that the response will come by the end of November—by which we do not mean Sunday night, but this week. It has not been able to clear all the internal hurdles that the noble Lord, Lord Rosser, being an experienced member of your Lordship’s House, will understand it needs to clear, so I will need to tread a bit carefully over some of the recommendations he wanted to hear about. He will not have to wait much longer, but I will not be able to satisfy him in every particular today.

I am sure noble Lords will understand that because of the formal response needed here, I am not in a position to address all those issues today. The Government take these issues, and police integrity more broadly, very seriously. It is at the heart of public confidence in policing and underpins the model of policing by consent.

Although I am unable to comment on the specifics of the report, I feel it is important for me to set out what this Government have done to put in place reforms to improve the accountability, transparency and integrity of policing in England and Wales and throughout the rest of the United Kingdom.

The most significant of these reforms came three years ago this month, with the election of PCCs. Since coming into post, PCCs have brought real local accountability to the performance of chief constables and their forces and are working hard to ensure that their local communities have a stronger voice in policing.

I appreciated reading through the report in some detail, especially some of the more anecdotal evidence given to the committee by representatives from local police forces—Greater Manchester being one; Merseyside another—on how the police and crime commissioners are working with the chief constable to implement these measures. That is a good example of what my

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noble friend Lord Wasserman said about local police and crime commissioners taking the initiative without necessarily needing to be instructed at every juncture. They realise that public confidence and ethical standards are at the heart of being able to carry out their duty, and that is happening.

The public profile of PCCs means that they are scrutinised in a way that anonymous police authorities were not, which helps to improve accountability in policing. Further, police and crime panels—PCPs—have been introduced in every police force area to scrutinise the actions and decisions of each PCC and make sure that information is available for the public, enabling them to hold the PCC to account.

PCPs have a range of powers to help them carry out their functions and specific responsibilities. A panel can, at reasonable notice, require the PCC to come before it. This power also extends to the staff of the PCC, including the deputy commissioner. The PCP is responsible for recording complaints made against a PCC and, where they are not of a criminal nature, resolving any such complaints.

The noble Lord, Lord Blair, made some very particular points about the operational integrity of chief constables and their ability to carry out investigations without fear or favour. That is a very important element. In fact, just last week, during a couple of Questions that came up in the House, we talked about the importance of integrity. The unique role of the Office of Constable and the oath that is given also came up. The oath is not to the Home Secretary but to Her Majesty, and is to pursue matters without fear or favour.

I am interested in the personal experience of the noble Lord, Lord Blair, in this regard, but there are particular procedures in place. I will not get into commenting on whether the Mayor of London followed them in that case, but the general point is that Schedule 8 to the police responsibility Act and Regulation 11A contain specific regulations and guidance as to how that ought to be done. It should involve the HMIC and conversations with the police and crime panel. That is set out. In that context, I am sure that this report will be read widely by police and crime commissioners. They should make themselves aware of their commitments, which they are obliged to do under law, when undertaking these matters.

The College of Policing was introduced as the first professional body for all policing in England and Wales. The college develops standards for policing based on strong evidence, so that future police practice is always based on evidence and not habit. The creation of the College of Policing is an important pillar in the programme of police reform, setting high professional standards, sharing what works best across policing, acting as the national voice of policing and ensuring that police training and ethics are of the highest possible quality.

In that context, the police Code of Ethics, produced by the College of Policing, has been published for the first time. Certainly, we would encourage all police and crime commissioners to have a discussion with their chief constables as to how that guidance is reflected

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in their forces. The Code of Ethics plays an important role in addressing some of the concerns about the ethics and behaviour of police officers and staff, particularly in relation to the media—a point raised by the noble Lord, Lord Blair. A consultation and review is taking place on relations with the media, including guidance on how contact with the media should take place and what procedures should be followed. That is an important part of the work of the College of Policing.

I refer also to the important role played by Her Majesty’s Inspectorate of Constabulary. It is important to look at the structural changes being made in the way that policing is maintained. Three years ago HMIC introduced the PEEL programme, which is all about the efficiency, effectiveness and legitimacy of the police. Its reports have been helpful in raising standards in forces across the country.

As the result of the changes made, the Office for National Statistics has highlighted the fact that recent increases in recorded crime are largely a consequence of improving recording practices within forces through the inclusion of previously under-reported crimes such as sexual offences. Victims are now more confident about coming forward, which is something to be welcomed.

The Government have made great strides in improving the accountability, leadership and ethics of local policing, but the job is not finished. We are making changes to legislation to make sure that police complaints and disciplinary systems are fairer and more transparent. The package includes making the police complaints system more independent of the police by expanding the role of the PCCs, and introducing systems for supercomplaints to ensure that the key trends and patterns in policing can be raised and addressed appropriately. We will overhaul the police disciplinary system following a review by Major-General Chapman. We will strengthen protections for police whistleblowers and enable the IPCC to continue to operate effectively by strengthening its powers. The Government intend to introduce these reforms in the Policing and Criminal Justice Bill that was announced in the Queen’s Speech.

I said that the progress the Government have made on police reform is not finished. In truth, we must never rest when it comes to ensuring that our police have the best leaders who are properly held to account and who lead forces according to the highest ethical standards. Another table in the report shows that the level of confidence and trust that people have in senior police officers is just a fraction short of that for judges, and significantly above that for elected and appointed members of what one might call the political class. We can have great confidence in the quality and integrity of our police forces. Reports such as that produced by the noble Lord, Lord Bew, and his committee will only serve to strengthen that.

Again, I thank the noble Earl for introducing this debate and I can assure him that by the end of the week, there will be further news in the shape of the Home Secretary’s response.

Committee adjourned at 5.34 pm.