Amendments made: No. 63, in page 19, line 2 [Clause 34], leave out from 'under' to the end of the line and insert

'Part 1 which amends or repeals any enactment'.

No. 64, in page 19, line 4 [Clause 34], leave out 'legislation' and insert 'enactment'. —[Mr. McFadden.]

Title

Amendment made: No. 65, in title, line 1, leave out 'reforming legislation' and insert

'removing or reducing burdens resulting from legislation, promoting regulatory principles'.— [Mr. McFadden.]

Order for Third Reading read.

I beg to move, That the Bill be now read the Third time.

Let me begin by thanking a number of colleagues and others in the House. First, I must thank my ministerial colleagues the Parliamentary Secretaries to the Cabinet Office. I am sorry that one of them did not have a chance to demonstrate his skilful mastery of his brief, but my hon. Friend Mr. McFadden demonstrated effectively his ability to master a complicated brief in a very short time. I thank the Under-Secretary of State for Constitutional Affairs, my hon. Friend Bridget Prentice, for her expertise in dealing with the Law Commission aspect of the Bill. I also thankmy hon. Friend Mr. Murphy, who is now Minister for Employment and Welfare Reform, but who did so much of the work that produced the Bill in the form in which it has been debated over the past two days.

I am grateful for the constructive advice given by a number of key Committees and their Chairs during the last few months on how best to frame the order-making powers in part 1, and on the parliamentary procedures for scrutiny of draft orders. I am particularly grateful to my hon. Friend Andrew Miller, to Mr. Knight, and to my hon. Friends the Members for Cannock Chase (Dr. Wright) and for Hendon (Mr. Dismore).

We have engaged in a lively and interesting debate over the past two days. Despite all the votes, I believe that there has been an advance that most Members throughout the House have recognised. We have sought to achieve a sensible balance between producing a Bill with the power to deliver better regulation—in which respect I confess we were ambitious—and ensuring that Parliament would play a full and constructive role in scrutinising proposals so that we could secure a better regulation agenda overall.

Well over a year ago, before the election, the Prime Minister made a fine speech about the importance of deregulation to his Government's plans. What will the Minister deregulate once the Bill has been passed?

I am sure the right hon. Gentleman knows that the Bill is only part of the Government's wide-ranging deregulation agenda. I look forward to working with him on a raft of measures in the public and private sectors to bring about much more effective operation. Perhaps he would like to share some of his ideas with me.

rose—

Not tonight. We have plenty of time, and I want to allow others to contribute to this debate.

I am sorry that the right hon. Gentleman was not present earlier, but as was said a number of times today, the Bill does not stand in isolation, nor can we allow ourselves to consider it in a narrow way. It is part of a much wider Government agenda for cutting red tape in the public sector, businesses, charities and the voluntary sector. As part of that wide agenda, the Government are measuring the cost of all administrative burdens. The outcome of that work, and the concerted push across Departments for better regulation, will be reflected in concrete simplification plans from each Department which will be published this year. Attentive Members will be aware that that was announced in the Budget.

The challenge for the United Kingdom and all western countries is to drive up productivity and maintain competitiveness in the face of rising global competition. Essential to meeting that challenge is a regulatory regime that satisfies the needs of the public while imposing the smallest possible extra burden on businesses.

This rhetoric is music to my ears, but may we hear just one example from the right hon. Lady—whom I greatly admire—of what the country will be rid of as a result of the Bill?

One idea that I have spent some time on, and which I will look at again in much more detail when I do not have to spend so much time on complex legislation such as this, is bringing inspectorates together. That will ease the burden on a range of public sector organisations and enhance the impact of these measures on the citizen.

Essential to meeting the challenge to which I referred earlier is a regulatory regime that meets the needs of the public, while adding the lowest possible burden to businesses. Let us think for a moment about that challenge. Today, Asia's manufacturing output is greater than Europe's. Its share of world consumption has risen from some 10 per cent. to nearly 30 per cent. in the past 20 years. In the next five years, China's economy will overtake Germany's, which is now the EU's largest economy. China's exports to the EU have grown by 100 per cent. in just the past three years. China and India are now turning out more engineers, computer scientists and university graduates—4 million a year—than the EU and the USA combined. As we all know, the gap in productivity and competitiveness between the USA and the EU is widening, not narrowing in the way that it should.

Will the right hon. Lady give way?

The hon. Gentleman will understand that there are many potential gains that we can deliver if we maintain this agenda. Regulatory costs are estimated to be between 10 and 12 per cent. of gross domestic product, and the administrative and paperwork costs make up perhaps a third of that figure. As for measuring the administrative costs of regulation, as we are now doing on an even more ambitious scale, the Dutch Government discovered that they were 3.6 per cent. of GDP.

rose—

Reducing those costs by a quarter over five years, as the Dutch are doing, could save us up to 1 per cent. of GDP. That is exactly the sort of approach that we should seek to adopt.

I call Mr. Heald.

This Bill—

I am very grateful to the right hon. Lady for giving way to me, Mr. Speaker. You were obviously surprised by her generosity, but I am not. How is what she just said consistent with the concession that the Parliamentary Secretary, Cabinet Office, Mr. McFadden made earlier today? He said that new Clause 19 would enable overall burdens to be increased.

As the hon. Gentleman knows, we believe that, used properly, these provisions will reduce burdens. But as my hon. Friend the Member for Wolverhampton, South-East said, different sorts of burdens might arise.

Bigger ones.

If the hon. Gentleman is patient, I will explain. Regulation itself is not a bad thing; it is the manner in which it is imposed that is the problem. [Interruption.] If the hon. Gentleman will have a little patience, I will deal with that point now.

The Government's better regulation agenda is designed to reduce burdens without reducing the effectiveness of regulation or its outcomes, so we are not going to stop introducing new regulations when they are needed. The Government make no apologies for continuing to regulate to improve standards in public services, to promote competition, to ensure fairness at work, to help industry and to provide protection for consumers and the environment. Indeed, one of my right hon. Friends said to me earlier, "I hope that we're not so against regulation that we're going to send children back to work up chimneys again." Of course we are not.

The order-making powers in part 1 are intended to take their place among the number of mechanisms designed to turn the aims of better regulation into reality for the end user on the ground—for those in business who create wealth and jobs in our economy, and those in our public services, voluntary and charitable organisations who improve the lives of our citizens.

The World Bank survey published in September 2005 rated the UK second in the EU and ninth in the world for best business conditions. That and other independent reports show that the UK is doing well, but as I have said, the challenge from global economic development is huge. We must ensure that the UK remains competitive.

The order-making powers in part 1 will not be the appropriate or even the necessary mechanism for every better regulation initiative. In many instances, however, they will provide real tools, where appropriate, for Departments to pursue their ambitious plans for removing unnecessary regulatory burdens without having to fight for precious time on the Floor of this House.

The order-making powers as defined by the amended Bill are more fit for purpose than the powers in the Regulatory Reform Act 2001 have proved to be.

Will the Minister give way?

If the hon. and learned Gentleman will forgive me, I must make progress, as we are nearly out of time.

In broad terms, that is because the rationale for using the better regulation powers will be outcome-focused on reducing costs or on removing obstacles to productivity, profitability or efficiency. They will not be limited by a very tight definition of legal "burdens"—a matter that I know that the House has explored in some depth.

The better regulation initiatives that this order-making power will allow us to deliver include the consolidation of legislation to make it easier to understand and work with, and the reduction or removal of administrative burdens such as form filling or requirements to give information. I am anxious to make progress, so I shall not list the initiatives' effect on many other matters covered in the debate over the past two days.

Will the Minister give way?

No. Other hon. Members who have been here all day want me to get on with my remarks so that they can make a contribution.

We also need to enshrine it in statute that regulators, as defined and specified by order, must have regard to the statutory code of practice issued under this Bill. The concordat will be based on the Better Regulation Commission's five principles of good regulation. In the round, such initiatives should allow us to remove what business and others tell us time and again are unnecessary obstacles to their efficiency.

I had intended to say quite a lot about parliamentary procedure, but again, I shall cut that down. We have had a good and full debate on that, and the Government have made it clear that although we want to find an approach that does not place too much emphasis on our perception of how Parliament should act, we do not want to avoid the responsibility that Ministers must face in terms of how they behave. We have sought to get the balance right. We have listened carefully to what the House has said, and I have no doubt that we shall return to the matter.

Will the Minister give way?

I am sorry, but I must get on.

I want hon. Members to bear in mind the fact that the Government have a responsibility to ensure that the UK stands its ground in an increasingly dynamic and competitive global economy, and that regulation does not prevent our public servants and voluntary workers from serving our citizens. This Bill will allow Government to do that by providing mechanisms to deliver real and meaningful cuts in red tape on business, charities and voluntary organisations.

I want to leave hon. Members in no doubt that this Bill is needed. Business needs it, and is telling us so very loudly. Our dedicated public servants need it too, as do our hard-working voluntary and charity workers. It is an essential tool to maintain our competitiveness, safeguard our economic prosperity, reduce burdens on public services and improve the lives of all our citizens.

I commend the Bill to the House.

I welcome the Minister to her new responsibilities. It is good to see her escape at last from the confines of the Whips Office, and we look forward to hearing her speak regularly. I join her in her thanks to the Select Committee Chairmen and all who have taken part in the discussions.

The Bill was a mess at the beginning. It was not even the Bill on which the Government consulted. The proposals on which they consulted were very different. There has been a constant battle to try to get a Bill that really tackles deregulation, because we certainly need one—my goodness, we do. With a Government who are passing 15 regulations a day and increasing the burdens on business, whose extra costs are £50 billion since 1997, we need a Bill—but not a bad one.

We struggled in Committee. I tabled all the amendments suggested by the Regulatory Reform Committee and many suggested by other Committees of the House. All were rejected; the then Minister used to described them as debating points. Recently, however, common sense has been brought to bear on the problems and there has been a climbdown. I welcome new clauses 19 and 20, but they came so late in the day that we have not been able to tackle all the problems with the provisions. We still have issues about how to tackle the problems of small business and how to filter Law Commission Bills so that the most controversial are properly debated. We still have issues about the procedures to be adopted to give the House a veto.

There are great time pressures tonight, so I cannot explain all the reasons why the Bill is not yet ready to become law, but I cannot stomach the idea that it should go to the other place with the approval of the Opposition.

In the short time that my hon. Friend has been given, will he kindly tell the House what part of the Minister's speech had any relevance or reference to the Bill? Most of us were unable to link the speech to the Bill.

Like many Members on the Opposition Benches, my right hon. Friend has a proud record on deregulation. The Minister was talking about deregulation, but just as there can be no good regulation without the right culture, there can be no deregulation without the right sort of legislation, and the Bill has a long way to go.

Did my hon. Friend find it as surprising as I did that after all those long debates, the Minister could not name one item that she would deregulate under the Bill? She said something about sorting out licensing that was not deregulatory, but she did not even seem to know about the Parliamentary Secretary's pledge to get rid of game licences. Does that mean that since yesterday, they have decided that they will no longer even get rid of game licences?

I will make one final point to show that the Bill is not good enough. The Department of Trade and Industry website shows new legislation proposed for the coming year. There are 40 pages of proposals. Nowhere in Government is there a similar website showing which measures will be deregulated. Until that happens, the Government will not solve the problems of their culture of regulation and burdens on business.

I should like to spend just one minute thanking hon. Members, including the members of Select Committees, for taking the work that we have done on the Regulatory Reform Committee so seriously. In particular, I thank the Minister for Employment and Welfare Reform, my hon. Friend Mr. Murphy, for the work that he did when he was the Minister with responsibility for the Bill, and I thank the new Minister, my hon. Friend Mr. McFadden for the sympathetic way in which he has dealt with his new responsibility. We have made progress, but more steps are still necessary, and I urge Ministers to think carefully about the commitments that they have given during our proceedings over the past two days. I am certain that we will have a Bill that enables us to proceed productively, by deregulating in the way that all parties in the House want.

This started off as a Bill with a benign intent, but it was nonsense, preposterous and deeply dangerous. It been marginally improved over the past two days, but there are still deep concerns about the way in which it will operate, deep concerns about its scope and deep concerns about the Government's inability to provide a proper veto. There is scarcely more than a caveat—

It being Ten o'clock Mr. Speaker put forthwith the Question already proposed from the Chair, pursuant to Order [15 May].

The House divided: Ayes 259, Noes 213.

Question accordingly agreed to.

Bill read the Third time, and passed, with amendments.