Clause 22

Consumers, Estate Agents and Redress Bill – in a Public Bill Committee at 10:00 am on 19th April 2007.

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Voluntary Activities

Photo of Mark Prisk Mark Prisk Shadow Minister (Business, Enterprise and Regulatory Reform)

I beg to move amendment No. 12, in clause 22, page 12, line 36, at end add—

‘(6) The Secretary of State must publish the reasons for any approval given under paragraph 22(4)(b).’.

This is a probing amendment and our aim is to get the Secretary of State, or perhaps in this case the Minister, to explain to us the basis for making his decisions, or not. In what circumstances does the Minister foresee that this would be unacceptable? For example, if an overseas corporate body were involved, would that be something that would be acceptable to the Government, or not? That is one example; there are others. I would be interested to hear what the Minister has to say.

Photo of Jim Fitzpatrick Jim Fitzpatrick Parliamentary Under-Secretary (Employment Relations & Postal Services)

This amendment relates, as the hon. Gentleman said, to clause 22, the council’s voluntary activities and functions in this part of the Bill. Clause 22 (4) (b) provides for the new national consumer council to acquire an interest in a company with a view to exercising its function under this clause. Following debates in the other place, a Government amendment was moved to make the council’s power to acquire an interest in a body corporate subject to the approval of the Secretary of State. As a body which is part-funded by the taxpayer, there will be a duty on the council to satisfy certain requirements regarding its financial dealings. Having to obtain the Secretary of State’s approval for expenditure in this area ensures that there is a consistent approach to proposed expenditure across all aspects of the council’s functions.

I am pleased to say—and this might surprise the hon. Gentleman—that the Government accept, in principle, his probing amendment laid to clause 22 of the Bill, that the Secretary of State must publish the reason for any approval given to a request by the new NCC to acquire an interest in a body corporate. This will ensure that any decisions taken are transparent and open to public scrutiny. Having considered this matter, I can advise him and the Committee that we intend to bring forward a Government amendment to like effect on Report on the basis that we believe that the drafting could be technically improved. I hope that, with this assurance, the hon. Gentleman will be minded to withdraw his amendment.

Photo of Mark Prisk Mark Prisk Shadow Minister (Business, Enterprise and Regulatory Reform)

I am grateful to the Minister for that. I think that it would probably be wise to shut up and sit down at this point, when one is moving slightly ahead. I am delighted that the Minister has been able to look at this in a positive way and I am happy to withdraw it on the basis that has just been explained.

Amendment, by leave, withdrawn.

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

Photo of Mark Prisk Mark Prisk Shadow Minister (Business, Enterprise and Regulatory Reform)

I have a couple of points that I wish to raise on the clause as a whole without wishing to detract in any way from the genial state of our discussion. This is a broadly worded clause which enables the council to undertake a wide range of paid and unpaid research and related activities. Subsection 3, as members of the Committee will see, says that the council may:

“Spend such sums as it considers reasonable”.

I entirely accept, and we have always argued, that the council must be independent. However, it would be helpful if the Minister confirmed that he is confident that there are satisfactory management and audit oversight provisions to ensure that, as public money is involved, it is to a standard that our constituents would expect.

Turning to subsection 4, the council is allowed to set up a limited company to exercise a particular function. This is, again, quite a wide power. If that company were to fail or to face significant liabilities, how would the Secretary of State be able to intervene; or is it the intention that the Secretary of State should not intervene?

Photo of Lorely Burt Lorely Burt Shadow Minister (Business, Innovation and Skills), Shadow Spokesperson (Business, Enterprise and Regulatory Reform) 10:15 am, 19th April 2007

I would appreciate a bit of clarity from the Minister about what he envisages. The measure will give the NCC the power to set up a subsidiary organisation or buy an organisation. The Liberal Democrats are wondering what sort of activities he envisages. The NCC could, if it wished, change its nature and function as we understand it. It could do stuff for money—[Interruption.] Sorry; it could conduct activities, I should say, for money. It is the nature of the beast that we are interested in understanding where he believes the limits of the NCC’s activities should be.

Photo of Jim Fitzpatrick Jim Fitzpatrick Parliamentary Under-Secretary (Employment Relations & Postal Services)

The clause provides the council with the power to carry out commissioned work in any area where it has skill, experience or expertise. Under the clause, the council will be able to give advice or assistance to others and be paid for providing that service. The provision is intended to give the council the power to participate in voluntary activities of its own choosing such as research projects and to receive remuneration for the services provided.

Clause 22(3) allows the council to spend reasonable sums in pursuing commercial opportunities that arise in the fulfilment of its functions, a point raised by the hon. Member for Hertford and Stortford.

Photo of Steve Pound Steve Pound Labour, Ealing North

I am not trying to be awkward; I am not an awkward person. But if the NCC expanded its remit and spread its wings to involve itself in some semi-commercial organisation, and a consumer of the services provided by that organisation—the Minister probably knows where I am going with this—was unhappy about the organisation, to whom would that consumer complain?

Photo of Jim Fitzpatrick Jim Fitzpatrick Parliamentary Under-Secretary (Employment Relations & Postal Services)

My hon. Friend raises an interesting conundrum. Although he protests that he is not a member of the awkward squad, I must remind him that I was his Whip for four years, and I know exactly his talent. I will research his question and get him an answer but I am sure that, as in any organisation, there will be Chinese walls and accountability lines. The new national council will have the sectoral expertise to handle a complaint from one section about dealing with another.

I was talking about accountability. In response to the point raised by the hon. Member for Hertford and Stortford about financial decisions, like any organisation the council will have an accounting officer, usually the  chief executive, who will be ultimately responsible for providing the necessary assurances that the Government’s strict accounting guidelines will be adhered to. On responsibility and liability, any companies set up would be limited companies and would therefore have limited liabilities, so there would be protection. The arrangements laid down for the council contain protections both for the public in how finance is expended and for the council in any exposure to liability that it might have.

Question put and agreed to.

Clause 22 ordered to stand part of the Bill.

Clauses 23 to 25 ordered to stand part of the Bill.

Schedule 2 agreed to.

Clauses 26 and 27 ordered to stand part of the Bill.

Further consideration adjourned.—[Steve McCabe.]

Adjourned accordingly at twenty minutes pastTen o’clock till this day at One o’clock.