Clause 1 - The Office of Fair Trading
Enterprise Bill
11:00 am
Dr Vincent Cable (Twickenham, Liberal Democrat)
As the hon. Member for Eastbourne suggested, this is an appropriate time to raise some broad themes about the Bill and I will pick up a couple of phrases that the Under-Secretary used in emphasising what she saw as important: the depersonalisation of decisions and the independence
of the OFT. That independence in day-to-day decisions is probably the most important change that the Bill will bring about. I will comment on that, particularly on how independence can and should be entrenched through political accountability. We could have that debate now or on schedule 1 stand part, but this time seems as appropriate as any.
As I said on Second Reading, the Government are right to move in the direction of independence. Otherwise, there would always be a conflict between a Minister's party role and role as a member of the Government, in which he or she must consider the broader interest. There have been several cases in which such a conflict has occurred. None the less, we should not be too modest or humble when debating whether politically sensitive decisions should always be handed over to quangos that are politically independent. There are dangers in that route too. We must strike exactly the right balance.
The system that has operated until now has a lot to commend it. No one would ever suggest that there is anything remotely corrupt in the British system under this Government, or their predecessor. It is a very honest system. Ministers have no personal interests in the decisions that they make. Equally, Government intervention in merger decisions in recent years has been minimal. Ministers have used their powers sparingly, such as the Under-Secretary's predecessor but two in the case of the takeover of regional electricity companies. Important political issues needed to be addressed and Ministers were right to use their political role in that capacity.
We need something in the Bill that retains political accountability, even though it makes the OFT independent of political direction on a day-to-day basis. We must be careful not to throw out the baby of accountability with the bathwater of unnecessary interference. Achieving that balance will be difficult. We could produce a situation that is worse than the present one if the OFT simply becomes a politically unaccountable quango in which people are appointed by Ministers and feel that they have little accountability to Parliament.
Those of us who have been in Whitehall know how the system operates. The permanent secretary has a draw, which may not be specifically labelled, containing a list of the great and good. When a big public appointment needs to be made, it is got out and dusted. The familiar suspects appear and the usual compliments, such as ''safe pair of hands'', ''doesn't ruffle feathers'', ''is well liked in the City'' are available. Assuming those qualifications are met, the suitable appointment is made. There was a wonderful example yesterday, with the appointment to look at corporate governance, which was a typical quango appointment.