Nigel Waterson (Shadow Minister, Work & Pensions; Eastbourne, Conservative)

I beg to move amendment No. 79, in clause 20, page 21, line 36, leave out ‘the Authority thinks appropriate’ and insert ‘shall be specified in regulations’.

Roger Gale (North Thanet, Conservative)

With this it will be convenient to discuss amendment No. 80, in clause 20, page 21, line 38, leave out subsection (2).

Nigel Waterson (Shadow Minister, Work & Pensions; Eastbourne, Conservative)

This is a short, pithy clause, but it does not give much away. It is about how the authority is going to manage itself during its short life. Amendment No. 79 would take out the words ‘the Authority thinks appropriate’ and insert

“shall be specified in regulations”.

There is a general point to be made here. In his rather chirpy letter at the beginning of the Committee stage, the Minister talked about producing draft regulations during the Committee stage. Unless I have missed them, I have not seen any, and it would be interesting to know whether we shall see any such regulations for any clause of the Bill before we finish on Thursday this week.

We think that the wording should be made a bit clearer and more obvious. We have said that regulation would be one way of dealing with what the general guidance might be. It seems that the authority would be able to pick and choose, as it thinks appropriate according to the way that the clause is worded, what general guidance it will be subject to and what not.

The second part of that subsection talks about generally accepted principles of good corporate governance, and who can argue with that? However, we then have subsection (2), which we would remove in its entirety by means of amendment No. 80, and which qualifies even that expression. So there is that obligation to follow “good corporate governance” principles, but that obligation is

“subject to guidance falling within subsection (1)(a), and”—

this is the really interesting bit, Mr. Gale—

“applies only to the extent that the principles in question may reasonably be regarded as applicable in relation to a statutory corporation.”

Even if I were not a lawyer, I think that I would recognise a wholly circular argument when I saw one, and I shall be grateful if the Minister will try to explain to us precisely what that gobbledegook means, or whether he agrees with me that we could do a certain amount of judicious pruning of clause 20.

James Purnell (Minister of State (Pensions Reform), Department for Work and Pensions; Stalybridge & Hyde, Labour)

I shall try to reassure the hon. Gentleman. We are trying to replicate the arrangements that have been made for other bodies such as the Office of the Commissioner for Public Appointments, a precedent that he helpfully cited earlier. It is normal in legislation to ask an organisation to have regard both to general principles of good governance—the Higgs report and so on—and to specific guidance set out by Government. The piece of gobbledegook, as the hon. Gentleman called it, is intended to state that where governmental guidance conflicts with corporate governance guidance or sets a higher standard of behaviour, the authority should follow the rules appropriate to non-departmental public bodies rather than the softer test of good corporate practice. I hope that that gives the hon. Gentleman the reassurance that he wants.

The general guidance in question is the extensive guidance issued by the Cabinet Office, the Treasury and the OCPA, which is intended to cover all eventualities for every type of public body. Principles of good corporate governance, on the other hand, include those outlined in the Financial Reporting Council’s combined code, which is based on the Higgs report. It is aimed more widely to include private sector organisations. Both sets of guidance outline extensive standards and practices, many of which will be appropriate to the delivery authority.

As I have said, in some instances the principles of good corporate governance are less strict than the guidance specifically for public bodies. An example that comes to mind is the recruitment process for members of the board. I understand that the combined code states that in certain circumstances there need be no external publication of vacancies, whereas the OCPA’s code of practice requires all vacancies to be advertised externally. The clause sets out the fact that the board will have to obey the stricter test rather than the more general one of good corporate governance.

Putting the general guidelines into regulations would achieve nothing more than the clause as it stands. Additionally, whenever the guidance was changed we would have to haul the hon. Member for Eastbourne up to a Committee Room and pass more regulations, which he would be able to debate. That might give him a different incentive from that which it gives the hon. Member for Yeovil, but I argue that it is not necessary. I hope that I have reassured him that there is a proper control framework, and that he will not press the amendments.

Nigel Waterson (Shadow Minister, Work & Pensions; Eastbourne, Conservative)

I am most grateful. I am completely reassured—I am reassured out, in fact. I do not know why I had the temerity to table the amendments in the first place. I beg to ask leave to withdraw the amendment.