Eleventh Report Contents

Instruments of interest

Draft Armed Forces (Covenant) Regulations 2022

21.The purpose of these draft Regulations is to bring into effect statutory guidance16 about carrying out a new duty which requires public bodies to have due regard to the principles of the armed forces covenant (“the duty”). According to the Ministry of Defence, the covenant is a promise by the nation that those who have served in the armed forces and their families should be treated fairly and face no disadvantage when accessing public and other services. The Armed Forces Act 2021 strengthens the covenant by placing a new duty to have due regard to the covenant principles on specified public bodies17 when they are carrying out public functions relating to education, healthcare and housing. These draft Regulations propose to implement key provisions of the new duty by defining service members and relevant family members to help public bodies identify more easily those to whom they must have due regard, and by bringing into force the statutory guidance to help public bodies in scope to discharge the new duty.

Draft Exclusivity Terms for Zero Hours Workers (Unenforceability and Redress) Regulations 2022

22.This instrument proposes to make so-called exclusivity terms unenforceable in contracts which entitle workers to net average weekly wages up to the Lower Earnings Limit (LEL, currently £123 a week). This includes apprenticeships where apprentices do not earn more than the LEL. The Department for Business, Energy and Industrial Strategy (BEIS) explains that exclusivity terms in workers’ contracts restrict their ability to take on additional work with other employers. They are already unenforceable in zero hours contracts. These Regulations would extend this protection to workers working under contracts where they are guaranteed a net average weekly wage up to the LEL, to ensure that they are also not restricted by exclusivity terms. The instrument would give these workers the right to take on additional employment without being subjected to unfair dismissal, or detriment by their employer, or having to gain their permission to seek additional employment.

23.Under the new rules, eligible workers would also be able to bring proceedings in employment tribunals and may be awarded compensation if their contracts include exclusivity terms. BEIS says that it intends to lay a separate negative instrument once these draft Regulations have been approved by Parliament and made. The further instrument will require prospective claimants wishing to take a case to the employment tribunal to contact the Advisory, Conciliation and Arbitration Service (Acas) first about their dispute and consider conciliation before presenting a claim to an employment tribunal.

Draft Public Sector Bodies (Websites and Mobile Applications) Accessibility (Amendment) (EU Exit) Regulations 2022

24.To reflect the UK’s departure from the EU, this instrument would replace the EU standard on website accessibility with the international standard recommended by W3C, the World Wide Web Consortium (as amended from time to time).

25.“Accessibility” refers to principles and techniques to follow when designing, building, maintaining and updating websites and applications, in order to make them easy for people to use, especially people with disabilities.

26.Although the standards’ requirements are broadly similar, this legislation changes the process from regulation to administration:

27.The Minister is still required to produce monitoring reports every three years, but the content of the report is at the Minister’s discretion and need only to be laid before Parliament whereas previously requirements were set out in law and the report was subject to scrutiny by European Commission experts.

28.Although this instrument would give the Cabinet Office increased flexibility to update the standard and its enforcement as new developments occur, the House may wish to give detailed consideration to the proposal before the power to set relevant standards is transferred permanently from legislation to an administrative function of the Government. We welcome this instrument being laid as an affirmative, so that in debate the House has an opportunity to reflect on it as an example of further powers moving to the Government.

Draft Sanctions (Damages Cap) Regulations 2022

29.The UK has imposed a robust sanctions regime in support of the UK’s foreign policy and national security objectives, including in response to Russia’s invasion of Ukraine. While the possibility of large damages remains, some persons designated under the sanctions may seek to challenge the Government through the courts. This instrument seeks to disincentivise such claims by capping the damages, where a court is satisfied that the sanctions decision was made in bad faith, to £10,000. An individual’s right under the Sanctions and Anti-Money Laundering Act 2018 to challenge their designation in court, and have it revoked, remains.

Money Laundering and Terrorist Financing (High-Risk Countries) (Amendment) (No.2) Regulations 2022 (SI 2022/782)

30.This made affirmative instrument updates the list of third countries (“the List”) which are considered to be high-risk in relation to money laundering and terrorist financing. Businesses have to carry out enhanced due diligence on any new and existing customers from such a high-risk country or for any relevant transaction where either of the parties is from a high-risk country. HM Treasury (HMT) explains that the update aligns the List with the lists of the Financial Action Task Force (FATF).18 The FATF makes periodic updates to its lists to reflect changes in global money laundering, terrorism financing and proliferation financing (AML/CTF/CPF). A country is added to the lists if it has been identified as having “significant strategic deficiencies” in its AML/CTF/CPF regimes.

31.The update made by this instrument removes Malta and adds Gibraltar to the List. We asked HMT which strategic deficiencies had been identified in relation to Gibraltar, and, given that Gibraltar is a British Overseas Territory, whether the Government would assist Gibraltar in addressing these deficiencies. HMT responded:

“In July 2019 Gibraltar was assessed against the FATF standards by its FATF Style Regional Body, Moneyval. Gibraltar was found not to have the required levels of effectiveness against ten out of eleven criteria.19

Following an observation period the FATF has agreed to put Gibraltar under enhanced monitoring. The reasons Gibraltar are subject to increased monitoring by the FATF can be found in its June 2022 notice.20 The FATF notes that Gibraltar has made significant progress against the recommended actions from its 2019 evaluation and must now complete the remaining actions, which are:

1) ensuring that supervisory authorities for non-bank financial institutions and DNFBPs use a range of effective, proportionate, and dissuasive sanctions for AML/CFT breaches; and

2) demonstrating that it is more actively and successfully pursuing final confiscation judgements, through criminal or civil proceedings based on financial investigations.

HM Treasury has ongoing engagement with the Gibraltarian authorities on completing the recommended actions from its mutual evaluation and the action items noted above from its action plan. The Economic Secretary to the Treasury wrote to Gibraltar’s finance minister in June 2022 on this issue. Gibraltar has made the necessary high level political commitment to completing the two actions noted above and does not require bilateral assistance to do so. We will continue working with Gibraltar as it engages with the FATF process.”

Russia (Sanctions) (EU Exit) (Amendment) (No. 12) Regulations 2022 (SI 2022/801)

Russia (Sanctions) (EU Exit) (Amendment) (No. 13) Regulations 2022 (SI 2022/814)

Russia (Sanctions) (EU Exit) (Amendment) (No. 14) Regulations 2022 (SI 2022/850)

32.These three instruments were laid just before the House rose for recess and came into immediate effect. They will be subject to debate in September as they follow the made affirmative procedure.

Judicial Offices (Sitting in Retirement–Prescribed Offices and Descriptions) Regulations 2022 (SI 2022/798)

33.The Public Service Pensions and Judicial Offices Act 2022 changed the retirement age for judges to 75 and created provision for certain judges, who had retired at 70, to return to an equivalent position within two years, if required. The tables in Schedule 1 to these Regulations list the prescribed judicial offices that a person must hold or have held prior to their retirement in order to be appointed to the corresponding sitting in retirement office. Judges appointed to these posts will be paid fees and accrue new judicial pension whilst also drawing judicial pension from their pre-retirement office.

34.While this particular instrument is narrow in scope, in that it simply lists the prescribed judicial offices, Members of the House may be interested in the impact of the wider package of reforms introduced by the parent Act. In particular, the House may wish to consider the implications of these new pensions arrangements for the pensions of other public sector workers, such as those in the health service; and how they fit with the other restrictions imposed by the pension lifetime allowance.

Care Standards Act 2000 (Extension of the Application of Part 2 to Supported Accommodation) (England) Regulations 2022 (SI 2022/808)

35.This instrument marks the first step in the introduction of mandatory national standards and Ofsted registration and inspection arrangements for providers of supported accommodation for looked after children (LAC) and care leavers aged 16 and 17. The instrument extends powers of the Secretary of State to make regulations or prescribe matters in regulations in this policy area. The second step will involve more substantive regulations to introduce the new standards and Ofsted registration and inspection regime, which the Department for Education (DfE) expects to lay before Parliament in late 2022/early 2023, following consultation.

36.According to the Department, demand on the care system is increasing, and the number of LACs and care leavers placed in supported accommodation is growing rapidly. DfE says that in the absence of any regulatory framework, the quality of provision is highly variable and too often children are placed in settings that do not meet their needs or keep them safe. Against this background, the new national standards and Ofsted regulatory regime seek to increase consistency and security for all children up to the age of 18, and to improve the quality of supported accommodation and ensure that Ofsted can take action when needed.

Abortion (Amendment) Regulations 2022 (SI 2022/811)

37.These Regulations make administrative amendments in response to the changes made by the Health and Care Act 2022, which made permanent the arrangement used during the pandemic that allows Early Medical Abortion (EMA) without attending a clinic.

38.EMA involves the taking of two pills: prior to the pandemic the first (mifepristone) would be taken in the clinic and the second (misoprostol) could then be taken either in the clinic or at home. The 2022 Act makes permanent the arrangement which allows both pills to be taken at home following a remote consultation, if the registered medical professional can certify “in good faith” that the pregnancy to be terminated by EMA is under ten weeks gestation. The Regulations also modify the HAS4 form, used to provide information to the Chief Medical Officer, to enable the collection of better evaluation data. We received a submission from Christian Action, Research, and Education (CARE) raising technical questions about how this data would be collected and, in particular, when action will be taken to improve data on the recording of medical complications for EMAs completed at home: CARE’s letter and the Department’s response are published on our website.21

Occupational Pension Schemes (Investment) (Employer-Related Investments by Master Trusts) (Amendment) Regulations 2022 (SI 2022/827)

39.These Regulations relax the restrictions on employer-related investments for defined contribution Master Trust pension schemes which are authorised by the Pensions Regulator and have 500 or more participating employers (“large Master Trusts”). The Department for Work and Pensions (DWP) states that this change still delivers the original policy intent of preventing malpractice at the top of the scheme’s governance structure whilst removing outdated restrictions which limit the ability of large Master Trusts to invest freely in the best interests of their members. Additional benefits to pension members as a result of the changes, however, are not guaranteed. While this legislation removes a burden and an overhead cost for large Master Trusts by removing the need for each investment to be researched for prohibited links, we were concerned whether it might also remove a protection for scheme members by allowing the Master Trust managers to use the huge sums available to them to boost (artificially) the share prices of participating companies. DWP has provided further information on the policy which is published in Appendix 2.

Street Works (Inspection Fees) (England) Regulations 2022 (SI 2022/830)

Street and Road Works (Miscellaneous Amendments) (England) Regulations 2022 (SI 2022/831)

40.Since 2020 the Department for Transport has been implementing “Street Manager” (a digital service for planning, managing and communicating street and road works). SI 2022/831 now makes its use mandatory for planning all works and amends the list of criteria used to designate a road as “traffic sensitive” and the definition of “major works”. It also requires highway authorities to notify a utility company when their works are overrunning and an overrun charge is being applied.

41.Using inspection data from Street Manager, SI 2022/830 will change the inspection frequency of street works depending on how each firm performs. The Explanatory Memorandum states that the average inspection failure rate is currently 9%, with the best firm at 2%, and the worst failing 63% of its inspections. From April 2023 the minimum level of works inspected will be 20% (with at least 5% of inspections in each of category A (whilst works are taking place), category B (within six months) and category C (within two or three years) to test sustainability of repairs, allowing the highway authorities to focus the other inspections on any identified areas of weakness). Those companies who fail more than 15% of inspections will have their number of chargeable inspections increased by 5% for the following quarter, those whose failure rate is less than 10% will have the number decreased as an incentive.

Aquatic Animal Health (Amendment) Regulations 2022 (SI 2022/835)

42.This instrument amends retained EU law to turn a legislative process for changing lists in relation to aquatic animal22 health into an administrative process. The Department for Environment, Food and Rural Affairs (Defra) explains that the changes will allow the Secretary of State (in relation to England, or for Great Britain, with the consent of the relevant devolved administrations), Scottish Ministers (in relation to Scotland) and Welsh Ministers (in relation to Wales), to amend the lists administratively, rather than by statutory instrument, as currently required. According to Defra, the lists include aquatic animal species that act as vectors for listed diseases; aquatic animal species that are susceptible to listed diseases; and species that can be imported into Great Britain from certain countries. The lists relate to imports of both live aquatic animals and aquatic animal products.

43.The Department says that the changes will help to protect Great Britain’s aquatic animal health status and support trade with third countries: under the new rules it will be possible to specify any changes made to the lists in a document published for that purpose rather than in legislation, so that the lists can be updated more quickly and officials can react to disease outbreaks which are restricted only to certain areas of trading partner countries. Where a species is included in the lists of susceptible and vector species for example, additional import requirements may apply. Defra says parliamentary oversight will be retained over the disease and third country lists: legislation will continue to be required to approve or delist a country, or to add or remove diseases from the list of diseases.

Criminal Legal Aid (Remuneration) (Amendment) Regulations 2022 (SI 2022/848)

44.In December 2020 the Government commissioned Sir Christopher Bellamy QC (now Lord Bellamy QC) to conduct the Criminal Legal Aid Independent Review (CLAIR) of criminal legal aid provision in England and Wales.23 Following consultation on the outcome, these Regulations are an interim response,24 providing for a 15% increase in fees for cases that begin on or after 30 September 2022. The Ministry of Justice states that this is an initial step that will increase the Legal Aid fund by £97 million to £115 million a year, but that this figure represents the limit of the Department’s current financial allocation. A further response to CLAIR will be published in the autumn. However, the Criminal Bar Association is currently taking industrial action seeking a 25% increase in advocacy fees, rather than 15%, and demanding that those rates should be applied to work in progress, rather than only to new cases from the end of September.

16 Ministry of Defence, Draft Statutory Guidance on the Armed Forces Covenant Duty (2022): https://www.legislation.gov.uk/ukdsi/2022/9780348237801/pdfs/ukdsiod_9780348237801_en.pdf [accessed 5 September 2022].

17 Armed Forces Act 2006, Part 16A.

18 The UK is a founding member of the Financial Action Task Force (FATF), an inter-governmental watchdog that sets international standards to prevent global money laundering and terrorist financing.

19 FATF, ‘Gibraltar’s measures to combat money laundering and terrorist financing’: https://www.fatf-gafi.org/publications/mutualevaluations/documents/mer-gibraltar-2019.html [accessed 5 September 2022].

20 FATF, ‘Jurisdictions under Increased Monitoring—June 2022’: https://www.fatf-gafi.org/publications/high-risk-and-other-monitored-jurisdictions/documents/increased-monitoring-june-2022.html [accessed 6 September 2022].

22 The term “aquatic animal” in the context of this instrument refers to fish, crustaceans and molluscs.

23 Independent Review, Independent Review of Criminal Legal Aid Sir Christopher Bellamy (29 November 2021): https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1041117/clar-independent-review-report-2021.pdf [accessed 5 September 2022].

24 Ministry of Justice, ‘Response to Independent Review of Criminal Legal Aid’: https://consult.justice.gov.uk/digital-communications/criminal-legal-aid-independent-review-response/ [accessed 5 September 2022].

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