Clause 15 - Penalties

Tobacco Advertising and Promotion Bill – in a Public Bill Committee at 11:00 am on 8 February 2001.

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Photo of Mrs Irene Adams Mrs Irene Adams Labour, Paisley North 11:00, 8 February 2001

The question is that clause 15 stand part of the Bill.

Hon. Members:


Photo of Caroline Spelman Caroline Spelman Shadow Spokesperson (Health)

Labour Members are trying to jump the gun by voting through the clause before we have had a chance to debate it, but they will not get away with it. Unfortunately for them, it is my job to ensure that that does not happen without some discussion.

The clause relates to the level of penalties that can be imposed for the offences. I am not entirely satisfied that the defences in clause 14 are as safe and sound as we would like. The provisions in clause 13 are not a mirror image of the Food Standards Act 1999, despite the fact that the explanatory notes say that there are similar provisions in the Consumer Protection Act 1987, and the Food Standards Act—they are similar, but with important differences. The fact that there are these lacunae cause the Opposition the anxiety. We are giving strong powers of entry here—[Interruption.]

Photo of Caroline Spelman Caroline Spelman Shadow Spokesperson (Health)

Thank you Mrs. Adams. I suspect that it is because speeches are off limits to Labour Members that we get a sedentary growl instead.

The lack of mirroring of other legislation—which has been more substantially debated than it has been possible to debate the powers of entry in this Bill—is the reason for the Opposition's disquiet about the position of a person whose premises have been broken into. The penalty for obstructing an officer—if it proved impossible to convince a court that it was unintentional—would be £1,000, which is a significant sum of money. It will difficult to prove the intentions, as my hon. Friend the Member for South Dorset said—it comes close to policing people's thoughts, which is an impossible thing to do. The penalty for any other offence on the Bill would be up to three months' imprisonment, or a fine not exceeding level 5 on the standard scale, and that is £5,000.

These are substantial penalties, affecting often small commercial premises, such as corner shops, newsagents. We are trying to legislate for both the corporate giants of the tobacco industry, and the small businesses that may be displaying a tobacco advertisement, and no distinction is being made between the two.

In the case of a small newsagents, or a specialist tobacconist, who displays a tobacco advertisement, since they are very often a one-man-band, a prison sentence of three months will possibly cause their entire business to fold. In part because it may be impossible to prove intention, one way or the other, and because reasonable cause for failure to comply has not been defined. I would seek in the guidance from the regulations, to have some illustration—which I asked for in the stand part debate on clause 14—of what might be a reasonable cause.

My hon. Friend the Member for Mid-Worcestershire (Mr. Luff) made the point that someone could produce a defence that they had reasonably grounds to doubt the identity of the individual trying to enforce the entry. This is particularly the case as there is some confusion over trading standards definitions, and weights and measures authority definitions, which have remained unclear.

The Minister thinks that there will not be many cases of enforcement, but the beginning is when there are likely to be the most cases and attempted prosecutions for failure to comply. It will take some time for this change in the law to be part of common practice. For many of those individuals, it would take a while to find out what the Bill meant. It is right to ask the Minister about the scale of the penalties and whether it is fair to legislate in this way for both big and small businesses.

Photo of Nick Harvey Nick Harvey Shadow Spokesperson (Health)

My concern is the opposite of that of the hon. Member for Meriden. I took her point that this seemed to cover the span from the corner shop to the big tobacco company. I listened with interest her point about the penalties being excessive for the corner shop, but my concern is quite the opposite, that they are not much of a disincentive to the big players, when one considers the volume of business and the profits that can be made, despite the fact that advertising, although legal, costs a great deal of money.

Clause 16 defines offences by bodies corporate. I appreciate that the existence of a three-months' term of imprisonment for someone within the body corporate is a fair disincentive, but a fine of £5,000 would come out of the petty cash box and would not be much of a deterrent if it felt inclined to give it a go. A single advert might produce revenue that would dwarf that fine. The Minister said earlier that the tobacco industry had said that it intended to comply with the Bill—I believe that to be so, and I hope that it will prove to be so—but, when enacted, the legislation will continue for some time and one does not know whether in future a business might be inclined to try its luck.

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

I join hon. Members in their opposition to these offences. More needs to be said, however, about the special offence that is being created, with a fine of £1,000—and, no doubt, a criminal record to go with it. I shall not go down the route of what constitutes a criminal record, but I think that the individual would have one and might not be able to hold a licence to sell alcohol, which could be serious for their business.

Under clause 14, a duly authorised officer could go into a shop and, if he saw what he thought was a criminal offence in terms of advertising at a point of sale that had broken the regulations, could interview an individual and say ``Who provided the information? Who said you should use this type of display on your premises?'' There is no requirement in law for the shopkeeper to have a lawyer with him and he could not say, ``Whoa, hang on a minute. I won't answer your questions until I've got my lawyer here to advise me.'' He could turn to the officer and say, ``Oh I've no idea who provided this.'' When it was shown by the officer later that the shopkeeper knew exactly which sales rep had put it in, he could be fined £1,000 under clause 15 for having knowingly given a false answer, yet on further investigation it may have been found that the display was legal, so that someone who was not breaking the law on advertising was being fined for not being helpful to the officer who asked where the advertising material had come from, and for trying to deny it.

There is no requirement that, before anyone answers questions, they should be cautioned that anything they might say could be taken down and, if untrue, could lead to prosecution. An authorised officer is not required to say to a person, ``I'm going to ask you some questions and I think you should get your lawyer here, because you could end up with a criminal conviction and a fine of £1,000.'' To have that on the record could be serious for that person's future, if they wanted to stand as a parliamentary candidate, become a magistrate, take out a licence to sell alcohol or run a night club.

I hate ever having to agree with the Liberal Democrats, but the hon. Member for North Devon (Mr. Harvey) made a sensible point. The tobacco industry and the people who sign up as members of the Tobacco Merchants Association are responsible corporate beings in terms of the law. I do not expect them to say, ``Let us break the law,'' but individual tobacco companies and individual retailers and wholesalers of tobacco will test this law. The company secretary might be liable for three months in prison but, as we all know, the magistrates courts do not imprison people for things like this, especially on a first offence. That the maximum fine is £5,000 is nonsensical.

What are we all doing here spending our time debating this Bill, if the Minister is saying, ``We have this Bill, it is full of loopholes but it provides something that was put in the Labour Party manifesto.''? With a £5,000 fine it is almost unenforceable. We know that a case involving 30p worth of bananas is costing the prosecuting authority over £200,000. We are saying to individual local councils that if they found the most blatant situation of a national organisation running an event such as a rave, with lots of free tobacco—

Photo of David Taylor David Taylor Labour/Co-operative, North West Leicestershire 11:15, 8 February 2001

The hon. Gentleman is making an important and interesting point in a characteristic way. Is it not the case that, where large corporations are prosecuted in local courts for particular offences, the main problem that they have, and that which they fear, is not the fine—as the hon. Member for North Devon said, that could be found in their petty cash box—but the publicity, which is far more of a sanction, in general terms?

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

The hon. Gentleman makes a point. I was not suggesting that Imperial Tobacco would not be put off by that, although we have had lots of speeches from the hon. Member for Rother Valley saying that these tobacco companies do not give a damn about public opinion and killing people. I do not necessarily go down that route, but—

Photo of Kevin Barron Kevin Barron Labour, Rother Valley

I have never used the expressions that the hon. Member mentions, and I never would do. Only 50 per cent. of people die prematurely by smoking tobacco.

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

I am not sure what that point is, but I follow the hon. Gentleman. One cannot say that too often, but I am not sure how that relates to clause 15. Worse than having these penalties is the death penalty for people who ignore the dangers of tobacco. Perhaps we ought to include this as a sub-clause (3) and Ministers ought to remind people that there is a death penalty for not realising how dangerous tobacco is.

If the Government and Parliament have decided on a particular Bill, it should be enforceable and the penalties should be commensurate. The Opposition do not believe in the thought police. We want a situation where people can reasonably say, ``This is an offence. Stop it.'' Hopefully, that will be the effect of the clause. We also have to take into account situations where an organisation has deliberately and blatantly decided to find a loophole. First, it will try to make it difficult to identify the appropriate officer who should be sent to prison. There will be all sorts of cut outs, such as who actually agreed the advertisement. If it were a company secretary of an organisation—that is normally what the position is—one would have to make sure that the company secretary was not resident in the Cayman Islands, as there would be no jurisdiction there to say ``I must have this individual removed from the jurisdiction and prosecuted.''

The very element of three months brings in a number of different points. I think thatI am right to say that we cannot extradite somebody on the basis of a three-months' prison sentence. I think I am also correct to say that, for instance, a police officer cannot burst into a premises in hot pursuit without a warrant if the offence for which the person is being arrested carries a penalty of less than six months' imprisonment. The low penalties cause some problems for enforcement authorities.

The Minister needs to tell us, on behalf of the Government, why she has decided first, that somebody should be prosecuted and fined simply for saying to an officer, ``I do not know about that,'' when they did, even if no other offence is being committed and secondly, why somebody who has blatantly gone against the wishes of Parliament should have their penalty limited to £5,000 with only a three-month fine in terms of the enforcement powers that police and other authorities normally have.

Photo of Peter Luff Peter Luff Opposition Whip (Commons)

The whole Bill rests on this clause, because if the penalties for breaking the terms of the eventual Act are not adequate, then the Act is just a toothless tiger. It is really important that this is looked at. The Minister is looking as though she is in less than her normally benign mood, but this is a genuinely important issue.

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

The Minister's smile has come back and we are glad but I think she was simply sitting there and thinking, ``Crumbs I have spent all this time and effort and I have got a toothless tiger.'' She is very disappointed to hear that.

Photo of Peter Luff Peter Luff Opposition Whip (Commons)

I hope she may think that because the Opposition find itself in a difficult position. We have reservations about the Bill, and whether it will have the effects that the Government claim that it will, but we do not want a Bill that will not work to pass into law. Bad legislation is in no one's interest. I agree with the hon. Member for North Devon very strongly, for reasons that I will explain, that this may be the case as a result of this clause.

The hon. Member for North-West Leicestershire (Mr. Taylor) talked about the effect of reputation on a company. That is the case for the major tobacco companies. They will be fearful and they will respect the terms of this legislation. In that sense, the larger game is won. It is the smaller players who worry me.

In my constituency there is a company that has consistently and persistently broken the terms of environmental law. It has taken years and years of fines. The company is called Ivory Plant Hire and it has been caught endlessly and the magistrates have consistently imposed inadequate fines on them. It has not been embarrassed by the adverse publicity in local papers; it has continued to livery its lorries and run them around my constituency proudly, breaking the law consistently and persistently.

I understand that, yesterday, at last the fines reached such a level that the company went into voluntary liquidation—I do not know the terms of that. It has taken years to get there and during that time my constituents' lives have been made a complete and utterly misery because the courts, as my hon. Friend the Member for South Dorset rightly said, were reluctant to imprison anyone. The firm had to be encouraged to realise the seriousness of the situation by the various enforcement authorities—the police, the Environment Agency, the district council, the county council and the traffic commissioners. All these people were up in arms against the activities of the company but it carried on breaking the law because the level of the fine imposed upon it was inadequate to deter it from its criminal activity. It is a real problem.

My hon. Friend the Member for Meriden rightly expressed concerns about the small companies—the small retail tobacconist who makes a genuine error—for whom the fine might be excessive, but the fine is not adequate for companies that are determined to break the law. There is a real precedent here. I understood that, for many years, tobacco advertising was illegal in Italy yet every publication in that wonderful country regularly carried tobacco advertisements, for the simple reason that the fine was so small that the advertising agencies just factored it into their costs and carried on. Although Italy could claim with all conscience that it had banned advertising, tobacco advertising was widespread throughout the country.

There is a real issue here for the Government to address. Are they satisfied that these fines are adequate to deal with both medium-size wholesalers and retailers, operating at regional or local level, or possibly, and perhaps more worryingly, by larger operators who decide to move into the vacuum—

It being twenty-five minutes past Eleven o'clock, THE CHAIRMAN adjourned the Committee without Question put, pursuant to the Standing Order.

Adjourned till this day at half-past Two o'clock.