Orders of the Day — Legislative and Regulatory Reform Bill

Part of the debate – in the House of Commons at 3:26 pm on 9th February 2006.

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Photo of Tony Wright Tony Wright Labour, Cannock Chase 3:26 pm, 9th February 2006

I am interested in that observation. I have not served on that Committee, but I am told by some who have that it has offered a way of scrutinising some of these orders that is quite different from the process that I caricatured, moving far more towards the sort of procedure that can be captured by a Special Standing Committee. We must move in all those kinds of directions, away from just treating pieces of legislation in terms of the normal party dogfight, and towards getting some intelligent scrutiny. We do that much better through Special Standing Committees. We do it better when we consider Bills in draft. We can also do it better, as I understand it, through the regulatory order scrutiny procedure. We should be cautious about setting our face against these developments, which have a lot to be said for them.

Having said all that, what is proposed in the Bill—as various Members have said—is unquestionably a major constitutional issue. As has been said, that is the case for considering it in the way in which we normally consider such measures. I know that the Government will think about that.

The whole area of deregulation and better regulation has a history. I enjoyed being reminded of the background to the deregulation measures of the Major Government. I was reminded of John Major's speech to the Conservative party conference in October 1992—[Interruption.] Indeed, some hon. Members were there. John Major anointed Michael Heseltine no less, then the President—as he liked to be called—of the Board of Trade, to take responsibility for attacking regulation and leading the deregulation agenda. He said to the conference:

"Who better for hacking back the jungle? Come on, Michael. Out with your club. On with your loin cloth. Swing into action!"

That was very good.

Within a short space of time of being given the job, however, Michael Heseltine discovered that it was not so straightforward. By that time, he had moved on to become the Government's general troubleshooter, and, my goodness, there was a lot of trouble at that time to shoot. He came before the Public Service Committee on 10 December 1996, to talk about how he was getting on with his deregulatory mission. He said:

"This is the dilemma of deregulation, that it is never simple, very rarely are you able just to say, 'Get rid of this', because you are dealing with health, safety, environment, vital aspects of a civilised society. Sometimes you can modify, but once you get into modification you get into complexity".

That was why I inserted into our exchanges with Mr. Heald earlier the point that, in a sense, every burden carries a protection with it. That was Michael Heseltine's conclusion, which is why the process is trickier than we sometimes think.

The Government have been right to move from that narrow focus on deregulation to a better focus on better regulation—as the Organisation for Economic Co-operation and Development says, from red tape to smart tape—which gets the notion of the balance right. We should remind ourselves that sometimes we do get things right. The OECD country report on regulation in Britain stated in 2002:

"With twenty years of continuous effort behind it, the United Kingdom is one of the most experienced OECD countries in regulatory reform . . . A constant up-grading of instruments has occurred simultaneously with the establishment of an array of regulatory policies, institutions, and tools, many of them innovative and unprecedented. This has formed a set of broadly efficient, transparent and accountable regulatory systems of high quality."

Across parties over the past 15 years or so, we have developed a robust and sophisticated approach to the whole issue of regulation. The Bill, however, represents a radical departure. The Government have decided on the most radical of the options that they discussed: they are taking power to reform any legislation. That is an extraordinary development, which requires the most careful discussion and scrutiny.

We must retain the value of some of the scrutiny mechanisms that we have developed in existing regulatory reform orders, and build in safeguards. My approach is fairly straightforward: yes, there is a case for new powers, but they must be matched by new safeguards. That is the only way in which to make the proposals acceptable.

The three main safeguards are these. First, there must be some limit on the use of the powers. It cannot be right to allow Ministers to reform any legislation in any way that they choose. The Regulatory Reform Committee has suggested that there should be a list of off-limits subjects. Another approach would be to allow change that was compatible with and proportionate to the original legislation. Ministers would then be able to use their powers to simplify legislation and bring it up to date, but they would not be able to transform the law in a way that was entirely different from Parliament's original intention. That would preserve a clear distinction between proposals requiring primary legislation and proposals that could be dealt with through secondary legislation.

Secondly, an effective veto is needed. If the Government are to be given more flexibility, it is no longer satisfactory for the veto to rest on an undertaking alone. The Government's own consultation document claims:

"Parliament will always and should always remain the guardian of what is appropriate to be delivered by RRO."

It also makes it clear that there can be no straightforward principles such as size or even complexity. If that is the case, Parliament must be able to exercise its guardianship order by order, not simply by approving the procedure in the Bill.

Thirdly, any proposals to change primary legislation must be properly scrutinised. The Regulatory Reform Committee has called for a minimum scrutiny of 60 days. It is interesting to note that parliamentary scrutiny currently accounts for only a small part of the time taken to process regulatory reform orders. An interesting table in the Regulatory Reform Committee's report shows that on average, the parliamentary scrutiny stage takes only 16 per cent. of the total time taken from initial consultation to approval, so that is not where the delay is occurring. That does not mean, however, that scrutiny should not be proportionate. The Committee itself has suggested that if it is felt that certain proposals need no amendment, it could be possible to do without the second stage of the scrutiny process.

For me—and, I suspect, a good number of others—if the principle is to be followed that the advancement of ministerial powers must all the time be matched by advancement in safeguards on the use of those powers, the House should expect the three safeguards that I have outlined to be included in the Bill, in order to provide that security. While I welcome the thrust of the Government's aims, the danger is that ministerial powers could be extended in ways that Parliament did not want or intend, and perhaps was not even aware of.