Proposals to Investigate Price Increases

Part of Clause 4 – in the House of Commons at 12:00 am on 21 June 1977.

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Photo of Mr Tim Smith Mr Tim Smith , Ashfield 12:00, 21 June 1977

I should like to make some brief observations about important matters that are encapsulated in these amendments. I wish to refer to an obser- vation that was made by the Secretary of State about the extent to which the previous Price Commission and the reports that it made were relevant to the proposed Price Commission and the reports that it will be making. The right hon. Gentleman said that the reports of the previous Price Commission were made by order of the Secretary of State but that in this case, in order to strengthen the independence of the new Commission, the Commission itself would initiate investigations.

However, there will be a parallel with the sort of unwritten code that arose under the previous practice. In practice there were five different stages with codes and revised codes. Firms of accountants and professional advisers built up their own sort of case law. However detailed the code, some questions must always be left to the discretion of the Commission. It is helpful for those involved in trying to determine matters fairly if a case law can be built up.

I want to raise some other important points of principle. It must be recognised that administration law must apply to such a case because the Commission is a quasi-judicial body. It should therefore, for example, be possible for the principle of audi alteram partem to apply, and for us to ensure that nobody should judge his own case.

Another important part of administration law is that when a decision has been taken by a quasi-judicial body the reasons should be stated, because if they are not, it makes it more difficult to challenge the decision.

I notice from the report of the Committee that the Minister said: if the Commission mounts an investigation on a wholly unreasonable basis, its action will be open to challenge in the courts."—[Official Report, Standing Committee B; 12th May 1977, c. 214.] We should not welcome it and one does not run a country fairly on court cases. However, that is a longstop.

It is important that we should be given details to widen the basis upon which one can challenge a decision. Reasons, built up over a period of time, would give guidance and set precedents so that a series of customs will accrue. We said during the debate on Clause 2 in Committee that the matters that can be taken into account on Clause 2 vary greatly. It would help in the elimination of uncertainty if people were told not only the reasons for arriving at a decision but the criteria under Clause 2 that had been referred to. It would then be possible for case law to be built up. That would be helpful to everyone involved in trying to pilot the new Price Commission in the most efficient manner.