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Clause 5 - Preliminary consultation

Regulatory Reform Bill [Lords] – in a Public Bill Committee at 5:30 pm on 27th March 2001.

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Photo of Mr Richard Page Mr Richard Page Conservative, South West Hertfordshire 5:30 pm, 27th March 2001

I beg to move amendment No. 16, in page 4, line 40, leave out

`appear to him to be'

and insert `are'.

Photo of Frank Cook Frank Cook Labour, Stockton North

With this it will be convenient to discuss the following amendments: No. 17, in page 4, line 43, leave out

`appear to him to be' and insert `are'.

No. 20, in page 5, line 3, at end insert

`and—

(h) publish an invitation to other bodies to make submissions.'.

Photo of Mr Richard Page Mr Richard Page Conservative, South West Hertfordshire

The amendments are all of a piece. Clause 5 allows Ministers wide discretion in the preliminary stages of the consultation process. The amendments make the consultation procedures more specific. Amendment No. 16 requires a consultation of organisations that have interests substantially affected by proposals. Amendment No. 17 refers to statutory bodies that might be affected, and amendment No. 20 refers to the consultation of other persons, as appropriate.

As currently drafted, clause 5 gives the Minister control in each case, as it appears to him. I find that a shade arrogant. The amendments are part of a pattern: the determination of Opposition Members to loosen the tight grip of the Executive's fingers from around the throat of regulation. Controls should not be placed back into the hands of the Executive. The purpose of the Bill is to ensure that there is regulatory reform, not to tell the people who created the regulation in the first place that they can still control the process.

There must be a letting-go and an opening-up. I therefore ask the Committee to look at the reality. What is actually going to happen when this part of the process takes place? Who will put forward the names of the various individuals and bodies that are to be asked for their views? It will be Department officials. Who created the regulations that will be scrutinised in the first place? It will be those same officials. I appeal for a more democratic approach to the consultation process.

If the Minister is minded to accept amendment No. 20, I suggest that he considers whether he and the Government will be protected against challenges from bodies that he may have decided not to consult. They may have been missed from the list; civil servants and officials may not have wanted the Minister to draw them forward for their views. If he were to accept the amendment, will he and the Government be free of any challenges from those bodies that had not been drawn forward?

I find it slightly disappointing that the Government are using their massive majority every time to sweep aside any amendments that are tabled. We are trying to improve the Bill. Our amendments were tabled not for party political gain or to promote dogma, but to try to reduce the burdens on the poor, struggling people—

Photo of Ms Helen Clark Ms Helen Clark Labour, Peterborough 5:45 pm, 27th March 2001

I feel that the hon. Gentleman has made a facetious and erroneous point about the conduct of Government Members. This is the seventh Standing Committee on which I have served since the beginning of this Parliament. Ministers have often been prepared to consider sensible points made by Opposition Members, and have sometimes even accepted amendments. For all I know, my hon. Friend the Minister may be prepared to do likewise.

Photo of Mr Richard Page Mr Richard Page Conservative, South West Hertfordshire

The hon. Lady brings a touching innocence to the Committee, which I find refreshing. As my hon. Friend the Member for South Cambridgeshire said, sotto voce, ``Don't hold your breath for the acceptance of any amendments.''

The amendments aim to create a better balance and to give people the freedom to bring forward views and make representations. At the moment, those people will be restricted to lists that appear to the Minister to be representative of the various bodies that are affected by the proposals. Those lists were produced by the officials who were responsible for the problems of regulatory burdens in the first place and are the reason why the whole matter is being considered.

Can the Minister give me two assurances? First, especially in respect of individual representatives, are the Government leaving themselves open to challenges under human rights legislation by anyone who feels that they are being denied an opportunity because the Minister is not minded to include them on the list? Secondly, is an organisation or body that has not managed to catch the ministerial eye so as to get on the list able to mount a legal challenge in order to do so, or will it be frozen out for ever?

The hon. Member for Peterborough (Mrs. Brinton) has given the Minister a lead-in to show that he can be flexible in terms of accepting amendments, and I look forward to his reply.

Photo of Graham Stringer Graham Stringer Parliamentary Secretary (Cabinet Office)

Again, we are dealing with a well-established process—the super-affirmative process. The wording is taken directly from the Deregulation and Contracting Out Act, which was supported by the previous Conservative Government. All parties in both places have found that the Act works when it comes to consultation. The hon. Member for South-West Hertfordshire is mistaken when he says that the Government are using their majority to force legislation through; we are doing exactly the opposite.

The super-affirmative process works by consensus because the Committees give unanimous reports. Is there a problem concerning consultation? No there is not, because a Minister will say, ``I shall consult those bodies that I believe to be affected or representative in this case.'' Can a Minister be 100 per cent. certain that he or she is right? No he cannot, because no Minister will have absolute knowledge. However, there are two safeguards against that. First, a Minister leaves the Room and a Committee questions whether he or she has been reasonable in his or her consultation. It considers whether other people have relevant views or would be affected by the proposals, in which case such extra people can be consulted. Secondly, the Cabinet Office publishes the regulatory reform orders on its website, as does the Department sponsoring the regulatory reform order. There is openness in the process. Even someone who is not thought to be representative or to have a relevant view can participate.

Photo of Mr Brian White Mr Brian White Labour, North East Milton Keynes

Is my hon. Friend aware that this morning's Select Committee on Deregulation, which was considering an existing order, took the view that there was insufficient consultation on the restaurants licensing order and has decided that other people need to be consulted? That gives the lie to the Opposition's argument that there is insufficient consultation. The system has built-in safeguards.

Photo of Graham Stringer Graham Stringer Parliamentary Secretary (Cabinet Office)

I thank my hon. Friend. I did not know that, but his example beautifully makes the point that safeguards are built-in by openness on the website and two Committees considering whether a Minister has consulted well enough. That is a better process than pretending that a Minister could know everything about whether a body was representative or not; it is impossible to have that knowledge. That returns us to the question of whether we pass power from Parliament and to the courts if we replace subjective tests with objective tests.

Photo of Ian Stewart Ian Stewart Labour, Eccles

My hon. Friend rightly rejects the argument of the hon. Member for South-West Hertfordshire. The Select Committee on Deregulation has the most rigorous consultative programme of any statutory body of which I am aware. The consultative programme is excellent and has been seen as the model for good practice in other areas of government. If Opposition Members of the Deregulation Committee had turned up, they would have been able to explain that to the hon. Gentleman.

Photo of Andrew Lansley Andrew Lansley Shadow Minister for the Cabinet Office and Policy Renewal

Before the Minister finishes, does he agree that discussing consultation processes that occur in Parliament does not answer the question with regard to preliminary consultation under clause 5? If he is content with what is proposed, which is the same as the provision in the Deregulation and Contracting Out Act, that will be one argument. However, will the Minister go further, consider amendment No. 20 and suggest whether the publication of orders on the Cabinet Office and departmental websites meets the need to publish an invitation for submissions in the preliminary consultation, as opposed to giving an opportunity to those affected to influence parliamentary consideration?

Photo of Graham Stringer Graham Stringer Parliamentary Secretary (Cabinet Office)

I understand the hon. Gentleman's argument. The Government are always trying to improve the flow of information and the consultation process. Putting regulatory reform orders on websites is a new innovation and allows people to participate in the initial consultation. The consultation information explains the super-affirmative process. Later, if people want to write to the Committee and to be consulted by it, they can influence the parliamentary process and have their views taken into account. The process is well tested and getting better, so I hope that the hon. Gentleman will withdraw his amendment.

Photo of Ian Stewart Ian Stewart Labour, Eccles

If it appears that some Labour Members are becoming exasperated, it is because we understand the rigorous nature of the processes of the Deregulation Committee, which will continue. The Committee has even called outside organisations to give evidence during the consultative process. The powers already exist and will continue.

Photo of Graham Stringer Graham Stringer Parliamentary Secretary (Cabinet Office)

I thank my hon. Friend for that information and hope that the hon. Gentleman will withdraw his amendment.

Photo of Mr Ian Bruce Mr Ian Bruce Conservative, South Dorset

One of my worries, which the amendment tabled by my hon. Friend the Member for South-West Hertfordshire would help to alleviate, is that under clause 5 the Minister will talk to people who are merely representative of interests. Companies or individuals who represent only themselves might not be invited by the Minister to send in representations. One often hears representations from a group on certain interests and then one person sends in a letter which wipes out the other representations. Does the Minister agree that asking individuals to send in representations would be better?

Photo of Graham Stringer Graham Stringer Parliamentary Secretary (Cabinet Office)

That is covered by subsection (1)(e), which states that the Minister will

``consult such other persons as he considers appropriate.''

That meets the hon. Gentleman's point.

Photo of Mr Richard Page Mr Richard Page Conservative, South West Hertfordshire

Before I comment specifically on the Minister's response, I want to draw the Committee's attention to the fact that, although the comments of the hon. Member for Eccles (Mr. Stewart) were pleasing and helpful, he referred to the process when it has travelled on a little and not when the Minister is constructing the order to bring before the Committee. That is what we want to deal with.

Phraseology such as ``the Minister considers'' does not show a broad spread of democracy, nor does asking someone to respond to a website. The Minister has given us no idea of the process for considering comments, which is one reason why we want to open up the process. However, he is adamant and is maintaining a position contrary to the hopes and expectations of the hon. Member for Peterborough. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Photo of Mr Brian Cotter Mr Brian Cotter Shadow Spokesperson (Business, Innovation and Skills), Shadow Spokesperson

I beg to move amendment No. 31, in line 41, at end insert

`allowing such organisations a minimum of 12 weeks to respond.'

Photo of Frank Cook Frank Cook Labour, Stockton North

With this it will be convenient to take the following amendments: No. 19, in page 5, line 3, at end insert

`and—

(g) allow a minimum of eight weeks for the consultation described in sub-paragraphs (a), (b), (c), (d) and (e) above.'.

No. 32, in clause 6, page 6, line 3, at end insert—

`(ja) the manner and timetable of any such consultation.'.

Photo of Mr Brian Cotter Mr Brian Cotter Shadow Spokesperson (Business, Innovation and Skills), Shadow Spokesperson

The amendment would ensure that the consultation period lasts a minimum of 12 weeks. It would be wise to put that on a statutory footing, because it is widely felt that businesses do not receive sufficient consultation on regulation. For example, I refer the Minister to a survey for 2000 by NatWest bank of more than 5,000 employers and personnel officers. More than 68 per cent. of respondents believed that the Government had not given adequate time for businesses to respond during public consultation. Many small firms cited the haste with which legislation had been pushed through the consultation period as the main reason for their inability to implement parts of it.

Photo of Mr Brian White Mr Brian White Labour, North East Milton Keynes

Is the hon. Gentleman aware of the point that was made to the Deregulation Committee when it took evidence on the Bill that, even if the consultation period were substantially extended, there would be some businesses for which that period would not be long enough?

Photo of Mr Brian Cotter Mr Brian Cotter Shadow Spokesperson (Business, Innovation and Skills), Shadow Spokesperson

I accept that point, which is well made. However, we must agree to some reasonable period of time, and I think that 12 weeks would be reasonable. According to the Better Regulation Task Force, the views of small business are insufficiently taken into account by policy makers. The Minister would be the first to acknowledge that that task force is a powerful organisation that we should listen to, and it also said:

``there is concern about inadequate consultation with small firms about the detailed arrangements for implementation and enforcement.''

Those examples show that there is great concern that many measures are pushed through without adequate consultation. I have encountered that concern frequently at different times during my time in Parliament, and it is necessary to highlight that point strongly because the amendment would be particularly beneficial to small businesses that do not have in-house experts to consider legislation on their behalf. It would also ensure an adequate period to formalise any response that they might want to make. It is self-evident that a longer consultation period would also mean that responses would come from a wider cross-section of organisations, thus representing a variety of different views. That would surely result in better legislation.

A minimum period of consultation would mean that legislation and regulations would be properly examined by the many external organisations on which they would impact. Once again, there would be less opportunity for a Minister to try to slip through legislation that went against the spirit of an Act—although I am sure that this Minister would not do that. In view of the comments of the Better Regulation Task Force, he will agree that consultation is extremely important. Although we cannot conduct consultation indefinitely, setting the figure at 12 weeks would provide a reasonable balance between carrying on ad nauseam and giving small businesses enough time to know what is coming down the line and to influence and respond to the policy, which is what consultation is all about. I hope that the Minister will consider the point seriously and I look forward to hearing his response.

Photo of Andrew Lansley Andrew Lansley Shadow Minister for the Cabinet Office and Policy Renewal

I am grateful for the opportunity briefly to say a word about amendment No. 31. Amendment No. 19, which is grouped with it, takes a slightly different view. I would not dissent from what the hon. Member for Weston-super-Mare said about the desirability of consultation and the necessity of providing sufficient scope for it. I would certainly hope that Ministers and Departments would allow sufficient time for consultation. My recollection is that it is standard practice to allow 12 weeks for substantive responses to consultation. However, we are dealing with a slightly different process and with preliminary consultation rather than a formal process.

The purpose of the amendments is to specify not the standard time for consultation, which is often done in relation to regulations made under other enactments, but a minimum period for consultation. We sought to set a lower minimum period in amendment No. 19, simply because we are dealing with a period of preliminary consultation which will normally be consultation with, as the clause provides, bodies representative of interests or statutory bodies affected which are often much better geared to consultation. The substantive consultation that would follow and would involve the Deregulation Committee, might draw in interests or persons who rarely have contact with Government Departments and who could not reasonably be expected to be aware of the prospect of such legislation coming forward.

At the preliminary consultation stage I assume that we are dealing with substantive bodies that represent interests and have the capacity to deal with consultation and amendments that are designed to set just a cautionary minimum upon Departments and Ministers so that they are never tempted to go for a preliminary consultation that is unduly abbreviated. I wonder whether the Minister might at least respond positively to that thought.

Photo of Graham Stringer Graham Stringer Parliamentary Secretary (Cabinet Office)

The Prime Minister launched a Cabinet Office document improving the process of consultation at the end of November last year—

Mr. Lansley rose—

Photo of Graham Stringer Graham Stringer Parliamentary Secretary (Cabinet Office)

I suspect I know what is coming. The basis of that consultation document was a standard three-month period. That could apply to consultations on regulatory reform orders with all the protections that exist later in the process. As everyone would acknowledge, there are times when initial consultation must be short for urgent or special reasons. Those reasons must be stated. The nature of the consultation process in that consultation document is three months, apart from in exceptional circumstances and, as under the Bill, reasons must be given for why the Government are responding in a particular way to the consultation document. My basic point is that the amendments are not necessary.

Photo of Andrew Lansley Andrew Lansley Shadow Minister for the Cabinet Office and Policy Renewal

The Minister might think me tedious as I raised this point on Second Reading, but if the Prime Minister was so keen on consultation, why at the Labour party's Glasgow conference did he leap into announcing parental leave changes on the day on which the consultation was due to end and before he could have received all the responses? I was reminded of that when I heard Mr. Digby Jones of the Confederation of British Industry on the radio last night. He complained about precisely that fact, which heightens the need for consultation provisions to be squarely represented to Ministers in the legislation, so that they cannot be unduly abbreviated.

Photo of Graham Stringer Graham Stringer Parliamentary Secretary (Cabinet Office)

The Prime Minister was right. His announcement was in line with the vast majority of the consultations that had been received on the matter. We may be in the run-up to a general election, and the big consultation on many of the fundamental issues that affect people's rights at work will take place then. Conservative Members will be able to set their views, beliefs and intentions against those of the Labour party. I suspect that we know what the outcome will be.

On the basis of the consultation document and the fact that this is a three-stage process, the amendments to clause 5 are unnecessary. I therefore ask the hon. Gentleman to withdraw the amendment.

Amendment No. 32 would add to clause 6 a requirement for details of

``the manner and timetable of any such consultation'' to be incorporated in the document. If the hon. Gentleman thinks about the existing obligation under clause 6(2)(j), which relates to clause 5(1) or (3), that information will already be present as part of the information that the Minister would reasonably be expected to provide. Even if it were not available, the Committees would have it and it would therefore be publicly available. The amendment is unnecessary, and I ask the hon. Gentleman not to press it.

Photo of Mr Brian Cotter Mr Brian Cotter Shadow Spokesperson (Business, Innovation and Skills), Shadow Spokesperson

The consultation for the general election seems to be a rather moveable feast. We do not know how long the run-up period will be, but we shall no doubt learn that shortly. It may be three weeks. It is not usually 12 weeks, but we shall have to see.

I thank the Minister for his response. It was important to raise this very significant issue on behalf of small businesses and the fact that it has been discussed is now in black and white. I take it that the fact that it has been raised and that the Minister and the Better Regulation Task Force accept the importance of consulting small businesses will mean that that is taken on board in future. On that understanding, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Photo of Andrew Lansley Andrew Lansley Shadow Minister for the Cabinet Office and Policy Renewal

I beg to move amendment No. 18, in page 5, line 3, at end insert

`and—

(f) in relation to the consultation described in sub-paragraphs (a), (b), (c), (d) and (e) above send to each person consulted a draft copy of the document the Minister intends to lay before Parliament as described in section 6 below.'.

The amendment would require the Minister to provide those persons whom he consults in the preliminary consultation—my hon. Friend the Member for South-West Hertfordshire would say those whom the Minister in his wisdom and at his discretion chooses to consult—with a draft copy of the document that he is required to lay before Parliament under clause 6. We shall go on to discuss what should be in such a document, so you will not expect me to dwell on that at any length, Mr. Cook. Suffice it to say that it will be a substantive document. Subject to what we go on to decide, it will set out many of the issues on which the consultees in the preliminary consultation want to know the Government's views, because we are dealing with a relatively complex set of orders compared with what occurred previously under deregulation and contracting out provisions.

We are dealing with a series of tests. As we have learned, we are talking not just about whether there is the necessary protection, but about whether there are reasonable expectations that need to be retained, whether a public interest will have to be balanced against the interests of persons affected and what the Government think that public interest might be. We will need to know whether the Government propose to impose burdens and whether it is desirable to proceed with an order that balances those additional burdens with the benefits that might flow from them.

On the basis of the Bill as drafted, we shall have estimates of the savings or increases in costs that will result from proposals. Obviously, those who are consulted will focus on that quantitatively. If we have our way, we might also end up with a process that is more akin to a genuine, comprehensive regulatory impact assessment.

All those questions would be of interest to preliminary consultees, but which comes first, the chicken or the egg? Will we have the document that is to be laid before Parliament, with all the details that must be presented in it, before the preliminary consultation, or will we have all the details only after the preliminary consultation? We should not expect Government to have answers to all the questions before the end of the preliminary consultation. Many facts and views—particularly concerning impacts, effects on persons and increases in savings and costs—will be derived from responses to the consultation.

The purpose of the amendment is not to pretend that the Government would know, before the preliminary consultation, all the facts necessary to complete the document referred to in clause 6. It is to suggest that it would be helpful to the preliminary consultation if the Government were to structure the consultation not simply around a presentation of the proposals but around the document that is subsequently to be laid before Parliament. That would help to focus the minds of consultees, especially in the early stages when regulatory reform orders are to be presented, on the considerations that must be decided by Ministers and on the issues that must be judged by the Deregulation Committees and the House. It is especially important in the early stages that the preliminary consultation should be structured around a draft copy of the document that will subsequently be laid before Parliament.

Ministers should not allow the consultation under clause 6 to carry too great a burden for the interests outside Parliament. In my experience, by the time Ministers lay a document before Parliament, they have become progressively more attached to it. Therefore, the earlier that we can expose the document to the outside world, the better. Consultation is free and open if Ministers have not committed themselves. The draft document might include various formulations or caveats and leave empty brackets, as it were, in which to fill in the precise detail. The consultation would be real in the sense that those bodies that are making representations would feel that they are feeding their material directly into the document that is to be presented to the Deregulation Committees and to Parliament. It is important that Ministers do not become too fixed on the document that is to be laid before Parliament, as if it were the final word. If Ministers and officials are relatively open to consultation at an early stage, it will be more effective.

If we were to adopt the amendment, we would forestall the risk that Ministers, in presenting their proposals, might tend to present the benefits of the regulatory reform rather than focusing on the costs. I hope that one specific purpose of the document to be laid before Parliament under clause 6 is to force Ministers to disclose their cost estimates. Therefore, by extension, those who are consulted under clause 5 would be clear about the costs that Ministers anticipate will be associated with the proposals. I hope that the Minister will not only continue to be constructive in his response, but be positive about the amendment.

Photo of Graham Stringer Graham Stringer Parliamentary Secretary (Cabinet Office) 6:15 pm, 27th March 2001

I thank the hon. Gentleman for tabling the amendment; I understand what he is trying to do. However, some of the information that will be required for the document and under clause 6(2) will come from the consultation, and some of the costs will be elicited from the people affected by the measure. The hon. Gentleman is suggesting that, as the process develops, the Minister will become increasingly firm in his views and that it will be easier for him to place the structure of the document in the context of clause 6(2).

The process is open. The consultees can state their costs, an issue to which the hon. Gentleman referred repeatedly. To pretend to know at the start things that are not known would be to put the cart before the horse. It would be more sensible to have open consultation, find the information and present it to the Committee. That process would show how one complied with the conditions in the Bill. Attempting that before consultation would lay one open to the accusation that one had decided what to do before consulting people thoroughly.

Photo of Andrew Lansley Andrew Lansley Shadow Minister for the Cabinet Office and Policy Renewal

I regret that the Minister had precisely the answer to my points that I feared he would.

The Minister is unwilling to contemplate the creation of structures under clause 6. If we want the parliamentary process to be constructed around such issues—I can see that much care has gone into the structure of the Bill—it is unhelpful to those who are the subject of preliminary consultation to receive something that is less specific than the document. It will be helpful to have that document structure even if, as the Minister said, there are omissions and gaps in knowledge when trying to complete the document later.

If consultation is to be open, Ministers should acknowledge that it will be open from the beginning, even when all the information is not available. That may highlight something that Ministers find embarrassing, but they should take it on the chin. They propose to go down the path of regulatory change, but they are unaware of the burdens—their impacts and costs, and where they fall. It would be more honest to present that information and make it clear that the balances have not yet been struck, and show consultees the initial proposals and how they can be justified in the document.

The proposals should not be presented as if a hidden agenda of knowledge existed; otherwise, there is a risk that the document put out for consultation would rehearse the criteria for a regulatory reform order and the tests that had to be applied in the legislation, which would suggest that Ministers had undertaken those tests before they had done so. In truth, the preliminary consultation should often state, ``These tests must be passed, but in some respects we do not yet know whether we have passed them.''

We therefore need the various forms of information. As someone who has been both the originator and, in a former life, the recipient of such documents, I know that it is helpful to have a clear steer on information held by the Government about which they feel confident, as opposed to information that they do not hold and on which they need advice. The Minister should at least contemplate allowing the form of consultation to follow some of the precise tests laid out in clause 6(2), even if such a provision is not to be included in the Bill.

Photo of Graham Stringer Graham Stringer Parliamentary Secretary (Cabinet Office)

I have tried to be helpful. The precise wording of the amendment puts the cart before the horse, but good consultation and the essence of the Cabinet Office's consultation policy document are precisely as the hon. Gentleman described. Consultees should know what information the Government want, and what it is possible and impossible to do under the proposals. That is the nature of good consultation, so I can give the hon. Gentleman some comfort in that regard without pretending that we can draw up a document under clause 6(2) before the appropriate point. That would be a confusing process, but I am happy to accept the principle behind what he is saying—in fact, it is Government policy.

It is worth emphasising that consultation does not stop when the statement under clause 6(2) reaches the Committee. The Committee itself may take extra information, deem the consultation inadequate and ask the Government to reconsider. That is very different from the normal Government consultation process that precedes primary legislation. In fact, the Committee's relationship with the Government differs greatly from that which normally applies in a straightforward consultation exercise preceding primary legislation. On that basis, I ask the hon. Gentleman to withdraw his amendment.

Photo of Andrew Lansley Andrew Lansley Shadow Minister for the Cabinet Office and Policy Renewal

I have pressed the Minister on this subject as far as is decent. Even if it is Government policy to consult in the manner described, I hope that the Minister will ensure—in fact, the task might fall to us—that subsequent implementation is indeed undertaken in the manner suggested, so that those who are the subject of consultation can be sure of what is required of them. On that basis, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Photo of Mr Brian Cotter Mr Brian Cotter Shadow Spokesperson (Business, Innovation and Skills), Shadow Spokesperson

I beg to move amendment No. 33, in page 5, line 3, at end insert—

`(1A)The consultation required by subsection (1) above will include details of whether any savings or increases in cost are estimated to result from the proposals and, if so,—

(a) the reasons why savings or increases in cost should be expected, and

(b) if it is practicable to make an estimate of the amount, that amount and how it is calculated.'.

As is clear from the amendment, it is somewhat disturbing that under the Bill the consultation need not include details on

``the reasons why savings or increases in cost should be expected'',

``an estimate of the amount . . . and how it is calculated''.

If the amendment were accepted, the Minister would have to disclose, where appropriate, any costs or savings likely to be incurred in the consultation process as a result of an order. Under the Bill as drafted, the Minister is obliged to do that only under clause 6—when the document is presented to Parliament.

I thought that, in keeping with the general direction of legislation and the European small business charter, the Government were saying that they wanted to do all that they could to ensure proper assessment of new regulations and Bills. That should apply equally to consultation on orders. It seems bizarre that the proposal for an order should be put out to consultation without the inclusion of such information. How can a business or organisation come to a reasoned conclusion about the impact that an order might have on them, when it is not aware of its possible financial impact?

The point is especially relevant to small businesses, which have been much discussed here, as in many other Committees. Small businesses have a high profile now, because people realise their importance to the country's economy. The cost of regulation often has a disproportionate impact on small businesses, especially micro-businesses. The devil might be in the cost details of an order that seems reasonable in principle, and therefore acceptable to the relevant organisations. If it were found to place significant financial burdens on organisations, an entirely different conclusion might be reached.

To be really effective, a cost analysis must be provided during the consultation process. Great emphasis is now placed on impact assessments when Bills come before Parliament. I hope that the same emphasis will be given to the consultation process for orders. The point is a key one for small businesses and organisations, and I shall be interested to hear the Minister's comments.

Photo of Andrew Lansley Andrew Lansley Shadow Minister for the Cabinet Office and Policy Renewal 6:30 pm, 27th March 2001

I am grateful for the opportunity to speak on amendment No. 33. It would achieve a small part of what amendment No. 18 set out to do—bring part of the reasoning behind a proposed order into the preliminary consultation process. I hope that the hon. Member for Weston-super-Mare will forgive me, but I find it slightly curious to think that one could be clear about the costs and savings if other information were not made available. Some of that information would be more qualitative; the better advanced it was, the better the quantitative information, and savings in cost, might be.

Nevertheless, the hon. Gentleman makes a good point, and I do not want to be uncharitable to him. Later, we are likely to debate regulatory impact assessments, which I know were debated in another place. They are not just about the narrow issue of the cost of adapting to regulations. We have moved to them from compliance cost assessments, and the distinction between the two is important. The purpose of a regulatory impact assessment is to understand all the effects of a regulatory change.

Photo of Mr Brian White Mr Brian White Labour, North East Milton Keynes

If what the hon. Gentleman says is true, why does his party oppose the use of regulatory impact assessments in the public sector? Conservative Members have said that they should be used only in business.

Photo of Andrew Lansley Andrew Lansley Shadow Minister for the Cabinet Office and Policy Renewal

Perhaps the hon. Gentleman will quote where that was said chapter and verse. If there is a difference, however, it is because of the point that I was about to make. Compliance cost assessments measure the direct cost of changes in regulations. In the public sector, such costs are often direct and can be quantified. That is often precisely the method that the public sector uses to quantify costs when they are expressed to the private sector. The larger changes in costs and impacts are the commercial consequences of changes in regulations that might create different comparative advantages between businesses in terms of prices, sales, overheads or whatever. Perhaps I can gather the information together for our debate on Thursday, but from memory, I believe that the regulatory impact assessment on the Regulation Investigatory Powers Act 2000 was specific as to some of the costs that would flow directly from those changes. The regulatory impacts properly should have reflected some of the commercial consequences, which were measured in tens of billions, rather than tens of millions, of pounds. That was the consequence of examining direct costs on businesses.

I shall not digress further so as not to prolong the debate, but the purpose of the amendment of the hon. Member for Weston-super-Mare might be to focus the minds of those who are the subject of consultation on some of the direct savings and increases in costs, which will then have precisely the kind of commercial consequences on a broader range of prices, sales, overheads, competitiveness and so on that will give rise to regulatory impacts. That ought to be borne in mind in the preparation of documents and be well understood by businesses before they consult on the parliamentary stages of the process. I shall not say that there is no value in amendment No. 33, because there is. I wish that it were amendment No. 18, but amendment No. 33 is good as far as it goes.

Photo of Graham Stringer Graham Stringer Parliamentary Secretary (Cabinet Office)

I do not believe that the amendment adds anything to what is already in the Bill. The hon. Gentleman knows, because we have discussed it many times, that every regulatory reform order has to have with it a regulatory impact assessment. As the hon. Member for South Cambridgeshire said, the RIA is about rather more than costs and benefits. It is an analysis of the best way forward, as we improve the process. We have to assess the impact of any new regulations on different parts of the economy, as opposed to just on businesses.

That RIA will accompany RROs and will present more information than is asked for in the amendment. Therefore, the amendment would add nothing to the Bill. I agree with the comments made by the hon. Member for Weston-super-Mare about small businesses. We introduced the Bill to balance regulatory regimes, which may benefit small businesses. I ask the hon. Gentleman to withdraw the amendment.

Photo of Mr Brian Cotter Mr Brian Cotter Shadow Spokesperson (Business, Innovation and Skills), Shadow Spokesperson

This has been a useful debate. It has highlighted the concerns of all businesses. There should be serious assessments in these matters. We have long rehearsed the importance of regulating impact assessments generally—I am sure that the hon. Member for South Cambridgeshire agrees. Even in the short time that I have been in Parliament, I have noted that some Bills do not adequately address that aspect. I know that the Prime Minister has privately expressed great concern about the effectiveness of RIAs.

Our debate has been part and parcel of the concern expressed about the impact of Bills and regulations. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Photo of Mr Richard Page Mr Richard Page Conservative, South West Hertfordshire

I beg to move amendment No. 21, in page 5, line 8, leave out

`it appears to the Minister,'.

Photo of Frank Cook Frank Cook Labour, Stockton North

With this it will be convenient to take the following amendments: No. 22, in page 5, line 9, leave out `that'.

No. 23, in page 5, line 10, leave out `he' and insert `the Minister'.

Photo of Mr Richard Page Mr Richard Page Conservative, South West Hertfordshire

I freely admit that it would have been much easier to speak to these amendments if the Minister had been generous and kind enough to accept amendments Nos. 16 and 17. Perhaps to satisfy the hon. Member for Peterborough, the Minister may be willing to accept amendment No. 21 and to show the generosity of spirit which was referred to and for which we are desperately, if vainly, looking.

These amendments are consistent with what we have been arguing for throughout the debate. There must be a reduction in the power of the Executive. We should not forget that the Bill has been introduced because the Executive are responsible for extra regulations and the difficulties that have made businesses groan and shudder under the weight of such regulations.

The principles lying behind amendments Nos. 21, 22 and 23 are the same as those lying behind amendments Nos. 16, 17 and 20. Under our amendments, it will be easier, if not automatic, for people who were originally consulted to be approached again and asked for further views on any variant of the proposals and their effect.

I am sure that I will touch a chord with every member of the Committee when I say that we have all passed legislation in good faith. We may think that we have done the right thing, but be appalled when we go out into the real world and realise the raft of rules, regulations and burdens that have resulted from such legislation. I have certainly said to myself, ``I did not intend to lumber business with that amount of legislation.''

May I take the Minister back to the consultation process and ask him what will be the custom and practice of that process? The amendment would remove from the Bill the slightly arrogant phrase

``it appears to the Minister''.

When the consultation takes place, will people be consulted about the new ideas, rules and methods? Will they be consulted about cost estimates that will flow from the changes and proposals? Unless we give them some idea of the costs and burdens, not everyone will be in a position to carry out the regulatory impact assessments that we have been discussing. I recommend that the Minister should move towards setting up an independent unit for regulatory impact assessments. Too often, having created the baby, a Department can find no flaw in it, as there appears to be little cost involved in its implementation and operation.

I bring the Minister all the way back to the start of the consultation process. I should like to think that those who have given their views on the proposals will be automatically consulted if there are variants to those proposals. At what point will they be informed about costings, so that they can make logical and sensible decisions?

Photo of Graham Stringer Graham Stringer Parliamentary Secretary (Cabinet Office)

I hope to deal with the amendment quickly. The costings issue was dealt with in the debate on the previous amendment. All RROs and RIAs with the costings will be part of the process of consultation. Without repeating all that has been said about transferring responsibility from Parliament and the Government to the courts, this is one of the more unusual amendments that have been tabled. If the Minister has instigated consultation but realises that he must change his proposals and initiate further consultation, he will be a model consulter. He recognises that his original proposals were not quite apposite, so he consults again to obtain more information. The hon. Member for South-West Hertfordshire is suggesting that he should then be taken out of the equation.

The Opposition tabled a series of amendments to test us on removing ministerial judgment from the Bill, but they have reached the point of absurdity and I ask the hon. Gentleman to withdraw his amendment.

Photo of Mr Richard Page Mr Richard Page Conservative, South West Hertfordshire

I thank the Minister for his positive and constructive response. We are starting to prod a nerve when he responds in that way. His officials must be bleeding quietly to provide him with those abrasive words to utter to young and inexperienced hon. Members such as me.

The point is not to take the Minister out of the equation, but to remove the Minister's choice to do this, that or the other.

Photo of Mr Richard Page Mr Richard Page Conservative, South West Hertfordshire

When it comes to regulation, I sometimes wonder what they are for. They seem to be the mouthpiece of their officials and rubber stamp what their officials do. Ministers do not do their job and hold the line. I am looking the Minister straight in the eye when I say that I have been equally guilty. He is falling into the same trap. As the papers come through, they receive the ministerial rubber-stamp and go on down the conveyor belt. That is the reason for the amendments.

Photo of Mr Richard Page Mr Richard Page Conservative, South West Hertfordshire

I shall certainly give way to the hon. Lady, but I must tell her that the Minister is not going to accept my amendment.

Photo of Ms Helen Clark Ms Helen Clark Labour, Peterborough

Instead of taking the Minister out of the equation, perhaps we should bow to his superior judgment.

Does the hon. Gentleman really believe it apposite in Committee to criticise civil servants who cannot defend themselves?

Photo of Mr Richard Page Mr Richard Page Conservative, South West Hertfordshire

I accept the hon. Lady's strictures, but something must be done to stop the sausage machine churning out regulations day after day. She was not in Committee this morning--I am delighted that she has joined us this afternoon--and I am more than willing to furnish her with a list of the regulations that has been put on to the statute book during the past four years. They have increased by more than 10 per cent. That is what I am objecting to. Somehow, we must remove those burdens from business.

The purpose of the amendment is to try to tease from the Minister the process whereby consultation will take place and the extent to which the matter will be fully and fairly examined. I asked about costs and the Minister responded to previous amendments, but he has not given as full a picture of costs as I want. However, he has a closed mind and will not accept that there should be a broader and more democratic basis. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Photo of Frank Cook Frank Cook Labour, Stockton North

We now come to the question that clause 5 stand part of the Bill.

Mr. Lansley rose—

Photo of Frank Cook Frank Cook Labour, Stockton North

I must say that, following the lengthy discussion on a range of amendments on the matter, I shall need to be persuaded, but not by brown envelopes. Very briefly, Mr. Lansley.

Question proposed, That the clause stand part of the Bill.

Photo of Andrew Lansley Andrew Lansley Shadow Minister for the Cabinet Office and Policy Renewal

Would I be anything else? I shall not repeat our discussions on previous amendments, but the Minister is in the business of telling us what it is all about. Clause 5(1)(d) provides for consultation with the National Assembly for Wales where the provision will extend to Wales, and I am sure that that is fine. However, I note—this is a genuine question about something that I do not understand—that the Bill extends to Northern Ireland. I cannot find a consequent provision for consultation with the Northern Ireland Assembly. The explanatory notes have not enlightened me, and I wonder whether the Minister might do so.

Photo of Frank Cook Frank Cook Labour, Stockton North

That sounds reasonable.

Photo of Graham Stringer Graham Stringer Parliamentary Secretary (Cabinet Office)

The Bill represents the constitutional settlements with Wales, Scotland and Northern Ireland. In Scotland, the Deregulation and Contracting Out Act will continue. In Wales, where powers have been devolved, the Welsh Assembly must consult. In Northern Ireland, where many regulations have been taken by Orders in Council, the Bill will not apply, but it will apply where legislation has been passed for the whole of the United Kingdom.

Question put and agreed to.

Clause 5 ordered to stand part of the Bill.

Further consideration adjourned.—[Mr. Rooney.]

Adjourned accordingly at nine minutes to Seven o'clock till Thursday 29 March at five minutes to Ten o'clock.