Nicholas Winterton (Macclesfield, Conservative)

With this it will be convenient to discuss new clause 12—Separation of funds proportionality

‘(1) In exercising its functions under sections 29 and 30, the Board shall pay particular regard to what is proportionate.

(2) Without prejudice to subsection (1), nothing in sections 29 or 30 shall exclude—

(a) the exercise of or involvement in regulatory and representative functions by the same persons or bodies within an approved regulator;

(b) the exercise of regulatory and representative functions from common premises.’.

Henry Bellingham (Shadow Minister, Constitutional Affairs; North West Norfolk, Conservative)

New clause 12 should be judged in the light of the previous debate, as it, too, is about the separation of functions and proportionality. Some might argue that I am backtracking slightly on what was said in our debate on the previous amendment, which was moved by the hon. Member for Bassetlaw.

The new clause was inspired by the Chartered Institute of Patent Attorneys and the Institute of Trade Mark Attorneys. It provides that when exercising its functions under clauses 29 and 30, the board should pay regard to what is proportionate. It makes it clear that the small organisations—a number of approved regulators are small, highly specialist and technical bodies—simply cannot be expected to separate completely their representative and regulatory roles. That point was made by the Minister only a moment ago.

The professions represented by the institutes are not closed; one does not have to be a member of either institute to practice as an attorney. If they started charging their members excessive sums—if their cost base increased too much—they would lose members and thus lose critical mass. That is why they should be treated with proportionality. I urge the Minister to consider accepting new clause 12. She was sympathetic to the previous group of amendments, tabled by myself and the hon. Member for Bassetlaw, and she could combine that with the acceptance of new clause 12. It should protect the small specialist regulators who form an important part of the legal services system.

John Hemming (Birmingham, Yardley, Liberal Democrat)

In a sense, we return to the trade union question by discussing the extent to which patent agents and the like provide regulated rather than non-regulated services.

I am nervous about the new clause. In some circumstances, one would want those who makes regulatory decisions to be unbiased, which is to say that they should not also have a representative role. However, that would not necessarily mean that the two sides should not have any involvement at any point; they might have the same receptionist or something like that. Even in smaller organisations, I would be nervous about a situation in which the body’s elected president  took regulatory decisions. I am therefore not in favour of a statutory prevention—of rules that insist on some separation of personnel.

I accept that in a smaller organisation, if people need to be regulated, there are constraints, because people might have to work out of the same premises. The approach has to be proportionate, but there will be circumstances in which one would want to distinguish between the personnel, so that those who make the regulatory decisions are not democratically accountable to the people about whom they make those decisions.

Bridget Prentice (Parliamentary Under-Secretary, Ministry of Justice; Lewisham East, Labour)

Given the remarks that I made in relation to clause 29, it is only logical that I go away and reconsider the matter. My immediate reaction to new clause 12 is that it is a duplication of what we already have. I accept the points made by the hon. Member for Birmingham, Yardley about the clarity that is needed. I assure the Committee that the Bill will not prevent people from exercising regulatory functions and carrying out representative functions if necessary. However, given that the new clause and the existing provisions sit together, it will be appropriate for me to consider the new clause.