Licensing Bill [Lords] – in a Public Bill Committee at 2:45 pm on 29th April 2003.
I thought that I would break with tradition and move this amendment myself. These are both probing amendments intended to allow us to consider what is meant by whether a club is
''established and conducted in good faith''.
Clearly, the clause is important for determining whether an organisation is declared to be a bona fide club.
Amendment No. 318 relates to subsection (2)(a), which refers to any arrangements that have to do with
''the club's freedom of purchase of alcohol''.
What impact will that provision have on a licensing authority that is considering a club's arrangements for the purchase of alcohol from a brewery? I am well aware that some clubs have an agreement that requires them to take a certain amount of beer from a particular brewer. Quite often, that agreement is tied to the provision of a loan from the brewery to the club, perhaps to refurbish premises or provide working capital.
When I was a student, the bar in our hall of residence was funded by one of the brewers—I think that it was Samuel Smith's—which provided a generous loan to refurbish it. I am not quite sure what the outcome of that refurbishment was, as the
bar still looked pretty basic to me. However, the money had been supplied, and I am sure that we were all very grateful to the company for supplying it. Student unions are not the only such clubs. The Fareham Conservative club had a similar arrangement with a local brewer.
It is important for those of us seeking to interpret subsection (2)(a) that the Government help us to understand how important the arrangements are, and to what extent the closeness of the tie between the club and the brewery means that the club is no longer
''established and conducted in good faith''.
Amendment No. 303 refers to subsection (2)(e), and raises questions about the nature of the premises of the club. When my hon. Friend the Member for North-East Cambridgeshire spoke in the stand part debate on clause 61, he referred to the Caravan Club, which clearly felt that the fields where it held its caravan rallies would be appropriate premises for the purposes of clause 63. I am not sure that that is the case. However, what is it about the nature of the premises of a club that will determine whether the club is
''established and conducted in good faith''?
I have been to sports clubs—at least, they would probably fall into the category of clubs—where the premises were very basic, and there was not much to them. Equally, I have been to clubs that are much more lavish and well appointed, and there are a range of clubs in between.
It is important that the local authorities taking on responsibilities as licensing authorities under the Bill, and the club operators and their lawyers, understand what is meant by paragraphs (a) and (e).
I thank the hon. Gentleman for his explanation of the amendments. As has already been said, we believe that there is much that is worthy of preservation and encouragement in this country's club movement. Different considerations arise in relation to clubs, which, as I have said, are private premises to which public access is restricted. That is why they are treated separately from pubs, bars and other licensed premises, and why the supply of alcohol for consumption by members and members' guests, on premises for which a club premises certificate is in force, are subject to a different regime, with lighter controls.
Unfortunately, the very fact that the controls are lighter makes the special arrangements for clubs—both those operating under the current system and those that will operate under the Bill—a potentially attractive option for unscrupulous people who wish to circumvent licensing controls. That is why clause 63 sets out the matters that may be taken into account by the licensing authority when determining whether a club is established and conducted in good faith for the purposes of the Bill. Two of those matters are any arrangements restricting the club's freedom of purchase of alcohol, and the nature of the premises occupied by the club.
Amendment No. 318 would remove the licensing authority's ability to take into account any arrangements restricting the freedom of the club to
purchase alcohol when determining whether it is conducted in good faith. Amendment No. 303 would remove the licensing authority's ability to take into account the nature of the premises occupied by the club when determining whether it was conducted in good faith. The amendments concern measures that reflect provisions in the Licensing Act 1964 that prevent unscrupulous individuals from circumventing the licensing laws altogether, or seeking to pervert them for their own monetary gains. We have decided, entirely justifiably, to maintain those provisions in the new regime, notwithstanding the special arrangements that we have made for clubs.
It is right that licensing authorities should be able to take into account any arrangements, usually arising from the rules of the club, that restrict its freedom to purchase alcohol. An example of such an arrangement would be where alcohol can be purchased only through a specified individual. He or she may have used inappropriate influence to gain that position, perhaps over a number of years, and might, furthermore, use that position for financial advantage. The scrutiny of any such arrangements by the licensing authority offers a workable safeguard against such malpractice. I hope that after that reassurance, amendment No. 318 will be withdrawn.
It is right that the licensing authority should be able to take into account the nature of a premises when determining whether a club is conducted in good faith. Again, that arises from problems that were identified and addressed by the Licensing Act 1964, whereby accommodation that would normally be associated with the provision of a justice's on-licence was being claimed as constituting club premises. The measure is designed to prevent an individual or a group from forming a committee and claiming that the premises were used for qualifying club activities, when in reality it was used for sales to the public. We think it right that that safeguard should be continued, and I hope that the hon. Member for Fareham (Mr. Hoban) will have the confidence not to press amendment No. 303.
I am grateful to the Minister for his reply on those amendments. On his response to amendment No. 318, I can understand his argument about one person who may have used unscrupulous methods to acquire the right to supply alcohol to a club. However, if that is one extreme of the scale, compared with having completely free arrangements for the supply of alcohol, I am not sure where on that scale some of the existing arrangements with brewers sit. How concerned should a licensing authority be about the nature of tied, or close, arrangements between a brewer and a club?
Perhaps licensing authorities need to be provided with some more guidance on how to analyse such relationships to see whether an agreement to buy a certain amount of beer per year, for example, is a legitimate commercial arrangement that serves the interests of the club and its members, or whether it precludes them from benefiting and creates an unpleasant or difficult relationship between the brewery and the club. Perhaps some guidance needs to be issued to licensing authorities to help them to decide. On that basis, and subject to the reservation
mentioned, I shall be happy to withdraw amendment No. 318.
On amendment No. 303, the Minister raised a concern about the use of premises for what amounted to the sale of alcohol to the public. However, the condition in clause 62 would prevent easy sale of alcohol to the public, because there is a two-day period between people applying to join a club and being able to buy alcohol there. That will slow down the process and make it more difficult for premises to be used simply for the sale of alcohol to members of the public who come in from the streets to take advantage of some of the benefits that clubs may offer. Having said that, I understand the point that the Minister made about control of premises, but at a time when we are encouraging more public involvement in the licensing process, I wonder whether some of those arguments may be used to prevent the granting of a licence to new clubs.
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
With this it will be convenient to discuss the following:
Amendment No. 320, in
schedule 5, page 122, line 25, at end insert—
'Determination that a club is established and conducted in good faith
9A Where under section 63(3) it is determined that a club is not established and conducted in good faith, an appeal may be made to local magistrates.'.
To follow on from the Minister's comments about the importance of the matters in subsection (2) that a licensing authority may consider when ensuring that a club has been established and conducted in good faith, the licensing authority is required to issue a notice to a club if it does not meet the conditions set out in clause 63, but I cannot see in the Bill a right of appeal from the club to magistrates to enable it to dispute the licensing authority's findings as to the way in which the club has been established and conducted. I hope that there is provision in the Bill to enable licensing authorities to be challenged in a magistrates court so that any issues raised by a licensing authority about the way in which a club has been established and conducted can be properly aired.
I wonder whether I can reassure the hon. Gentleman by saying that at this stage I am not persuaded that an appeal to magistrates is necessary, and that the Joint Committee on Human Rights did not see fit to comment on that aspect. However, the hon. Gentleman raised an interesting point and I am prepared to look again at the matter and, if necessary, return with an appropriate amendment on Report.
I am grateful for the Minister's comments, and take note of what he said. It is important that clubs be given a right of appeal when appropriate. However, given the Minister's assurance, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Question proposed, That the clause stand part of the Bill.
When I was looking at the White Paper and the guidance on clause 63, I came across the following words in paragraph 101 on page 42 of the White Paper:
''The law relating to registered clubs once again exhibits unnecessary complexity, using many terms that are imprecise. For example, 'good faith' is an unclear way of setting standards of behaviour and propriety that should be required of clubs and their members. Another example is that members' guests may be supplied with alcohol on the premises in a variety of circumstances, but there is no clear statutory definition of the term 'guest'.''
Clause 63 deals with the establishment and conduct of a club in good faith, and I wonder whether the Minister seriously believes that the clause meets the laudable requirements set out in the White Paper, which states that such matters are difficult to define. One is left with the thought that the question may not have been addressed appropriately.
Chapter 10.8 of the guidance sets out the qualifying conditions of clauses 61 and 62 and goes on to say:
''Section 63 sets out additional qualifying conditions which apply solely to clubs intending to supply alcohol to members and guests. The full details in respect of these sections of the Act are reproduced in Annex [ ]''
The annex is still to be decided, so here we are, yet again, reaching a stage in the Bill where the accurate guidance that we ought to have in Committee to make sure that we are scrutinising this legislation at the most appropriate level is still not available. Perhaps the Minister could tell us why the guidance has taken so long and why, unless it has been supplied and we have not been sent a copy, the annexe to the guidance still states that the statutory qualifying conditions for clubs are to be agreed.
I should have thought that there had been sufficient time for those matters to have been sorted out between the various parties, and it would be helpful if the Minister were to tell us the stage that he has reached with the clubs in discussing the matters that relate specifically to clause 63.
As we have just debated, whether a club is established and conducted in good faith is one of the general conditions that it must satisfy if it is to be a qualifying club in relation to any of the qualifying club activities. Clause 63 sets out the matters to be considered in determining that. Those matters include restrictions on a club's freedom to purchase alcohol, how money and property belonging to the club is used, giving members information about the club's finances, the accounts of the club and the nature of its premises. If a licensing authority determines that a club does not satisfy those conditions, it must notify the club accordingly to give the reasons for its decision.
Clause 63 replicates current licensing law in laying down rules and conditions for qualifying clubs. It is designed to prevent abuse of the special system that the Bill provides in recognition of the special status and contribution of the club movement, which we have been debating.
The annexes will set out the qualifying conditions in the Bill, but they cannot be completed until it completes its parliamentary procedures, which is why we have to use shorthand in the interim.
Question put and agreed to.
Clause 63 ordered to stand part of the Bill.