LBRO: supplementary

I beg to move amendment No. 17, in schedule 1, page 38, line 13, leave out sub-paragraph (3).

With this it will be convenient to discuss the following amendments: No. 18, in schedule 1, page 38, line 17, leave out sub-paragraph (5).

No. 19, in schedule 1, page 38, line 20, leave out ‘special’.

These are probing amendments and seek to put certain details on the record, which I hope will enable the implementation of the legislation to be improved. Amendment No. 17 seeks to delete subsection (3) on page 38. Its purpose is to ask the Minister what we mean by Welsh Ministers. Are they members of the Welsh Executive, Ministers of the Crown, or both?

Amendment No. 18 is another probing amendment, which relates to paragraph 3(5) of the schedule. It states:

“LBRO is to pay to or in respect of the ordinary members such sums as the Secretary of State may determine by way of or in respect of remuneration allowances, expenses, pensions or gratuities.”

I am not entirely clear what that text means; perhaps there is an additional or a missing word, or a typographical error. I am not sure, but I shall be happy if the Minister would clarify that. I have three or four different interpretations of it, and I would be interested to hear the Minister’s reply as to whether there is an additional “to” in there.

Thirdly, amendment No. 19, relating to paragraph 3(6), reads:

“If the Secretary of State thinks that there are special circumstances that make it right for a person ceasing to be an ordinary member of LBRO to receive compensation, LBRO must pay to that person such compensation as the Secretary of State may determine.”

Can the Minister explain what he regards as those “special circumstances”?

I am a little confused by these amendments. I am not entirely sure why the hon. Member for Hertford and Stortford maintains that they would make enforcement more effective by taking out any rules regarding how the LBRO should be composed. If amendment No. 18 means that LBRO members would not be civil servants, why does he want to delete that?

These are entirely probing amendments. I have no wish to delete them, and it is not my wish to move them. My purpose is clarification of the Bill.

That is fine. I wait with bated breath what the Minister has to say in response.

We had a debate about the basic purpose of LBRO, and schedule 1 gives significant detail on how the organisation is proposed to be established and run. I shall briefly answer a couple of the questions asked directly by the hon. Member for Hertford and Stortford. The term “Welsh Ministers” means members of the Welsh Executive.

He asked about the wording in paragraph 3(5) of the schedule. As I understand it, this is absolutely standard wording for describing payments to people doing this kind of work, so we see nothing unusual about that wording. The whole schedule is designed to give effect to LBRO and to enable it to carry out its work, in seeking to support local authorities in developing an approach consistent with the principles of better regulation.

The schedule—or rather, the Bill—will, as well as the functions that we have talked about, also help to give LBRO a role in preparing lists of priorities for enforcement for local government, which can be an issue, given the number of different priorities that central Government gives. In terms of the specifics of the amendments, I am glad to see that they were probing, because the effect of approving the amendments would be to neuter the body from the beginning, so I hope that the answers that I have been able to give on the subjects of payment and Welsh Ministers have been helpful.

Let me turn to the third of the amendments, amendment No. 19, which asks about “special circumstances”. We have deliberately set up the body to operate independently of Government, bringing the expertise of its members to bear on issues raised by local authority enforcement. The wording of “special circumstances” follows well established precedents, and I shall mention just a few. For example, similar measures were included in relation to board members of Natural England in the Natural Environment and Rural Communities Act 2006. The Value Added Tax Act 1994 specified that there can be compensation:

“If a person ceases to be a chairman of VAT tribunals and it appears to the Lord Chancellor that there are special circumstances which make it right that he should receive compensation”.

There is similar wording in the Criminal Justice Act 1988. The Bill follows those models and provides for the possibility of cases where the provision of some form of compensation is appropriate. Such circumstances would be rare.

I hope that I can clarify things for the hon. Gentleman. We do not believe that there should be a presumption for compensation to be paid. That is why “special” is used. Board members will come to the end of their contract naturally or could be removed for any of the other reasons set out in the schedule, including committing a criminal offence or failing to comply with the terms of their appointment. In the vast majority of cases, it would not be right for compensation to be paid. However, it seems prudent to us for the Bill to allow for unknown contingencies. The reasons for that inclusion means that we have used “special” to describe circumstances in which compensation might be paid. I hope that that helps to clarify the point.

I am grateful to the Minister for providing those clarifications. As he knows—I know you know, Mr. Chope—one of the purposes of probing amendments is not necessarily to change the legislation, but to make sure that those putting it into practice understand the  Government’s intention. Often the Bill cannot provide that. Therefore, the purpose of the three probing amendments and of a good number of others is to use our deliberation to get that clarification on the record.

I am grateful about amendments Nos. 17 and 18. I am particularly grateful for the recognition and clear statement that there should be no presumption about payments under sub-paragraph 3(6). On that basis—the hon. Member for Solihull can unbate her breath—I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

I beg to move amendment No. 20, in schedule 1, page 39, line 39, leave out subsection (1).

With this it will be convenient to discuss the following amendments: No. 21, in schedule 1, page 39, line 40, leave out subsection (2).

No. 22, in schedule 1, page 40, line 3, leave out subsection (4).

These are, again, probing amendments—bated breath or otherwise. Let us look at page 39, dealing with paragraph 8, on committees surrounding the operation of LBRO. Amendment No. 20 removes the provision for LBRO to establish “one or more committees”. The provision is perfectly reasonable, but it would be helpful to know the Government’s intention or wish concerning the scope of those committees. It would help us to know the limits.

Amendment No. 21 is similar. It seeks to delete sub-paragraph (2):

“A committee established under this paragraph may include persons who are neither members nor employees of LBRO.”

The clause permits anyone to be on such a committee and, as we learn later, that is a paid position. Money comes from the public purse. Who appoints? What will the basis of those appointments be?

Amendment No. 22 is about paragraph 8(4), which is at the top of page 40:

“LBRO may pay sums by way of or in respect of expenses to or in respect of a person who is a member of a committee or of a sub-committee established under this paragraph but who is not a member or employee of LBRO.”

That is a wide statement. Given the heightened public interest in expenses, to what are the rules for those arrangements subject? What independent oversight might there be, should things go awry?

The amendments relate to the capacity of the Local Better Regulation Office to appoint sub-committees. One example of an important sub-committee that one would expect an organisation like this to appoint is an audit committee. We would also hope to allow the appointment of expert advisers to that committee and to pay its members. This is an independent body, operating at arm’s length from the Government, and it needs that independence to create the right governance arrangements for its statutory role. If I may refer to similar organisations and parallels in other legislation, both the Commission for Architecture and the Built Environment, created by the Clean Neighbourhoods and Environment Act 2005, and the Serious Organised  Crime Agency, created by the Serious Organised Crime and Police Act 2005, have similar powers to create committees.

The LBRO will not necessarily stop with an audit committee; it might wish to appoint an advisory committee, to advise it on issues raised by one or more of its functions. It should be a matter for the LBRO to decide whether it wishes to go down that road, but it may set up committees that will help it achieve its objectives. I hope that that gives some clarity on the purpose of the measure.

The hon. Gentleman asked a couple of specific questions. LBRO itself would appoint the individuals. Payments would be governed by the usual public money rules. As will be discussed later, LBRO has to account to both my Department and Parliament for its expenditure in the normal way. It has been granted a budget for the next few years, pending the approval of the legislation in Parliament, but any expenditure on paying people on its committees will have to come out of that budget.

I am grateful to the Minister for responding. I have no wish to try to instruct the LBRO in advance regarding specific committees. Our purpose is to clarify exactly how this will work and what recourse there would be for Government, and thence Parliament, to ensure that it is operating in an effective way. I am not overwhelmed by the Minister’s response. I accept that there is an established principle and I presume that Nolan was the process that he was referring to as regards public deliberation. I do not know whether he wishes to consider that. I have no wish to press the amendment to a vote because I am well aware that it would prove a nonsense, but it would be helpful if the Minister reflected on clarifying which particular rules he refers to and whether he feels able to consider any advice that may be forthcoming. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

I beg to move amendment No. 23, in schedule 1, page 41, line 2, at end insert

‘no later than 30 days after its receipt’.

With this it will be convenient to discuss amendment No. 24, in schedule 1, page 41, line 25, at end insert

‘no later than 30 days after its receipt’.

These two amendments deal with our ability to hold the LBRO to account. Members of the Committee will realise that the annual report of the LBRO is the principal document that the House will have in order to consider the performance of the organisation that the Bill establishes. I am trying to ensure that our scrutiny is timely. I therefore wish to insert a phrase to both paragraph 12(5) and paragraph 13(6). Paragraph 12(5) of the schedule states:

“The Secretary of Sate must lay before Parliament a copy of each report”

—that is, the annual report—

“received under sub-paragraph (2)(a).”

My amendment would insert the phrase,

“no later than 30 days after its receipt.”

I am sure that it is not the intention of Ministers to unduly or deliberately lay such documents significantly later than that—six months or a year or so—but if we are to scrutinise these matters as a House, it is important that we have the documentation within a reasonable time. I think that 30 days is a perfectly reasonable time within which we could expect those documents to be forthcoming. If scrutiny is to be effective, it must be timely. I hope that the Minister will treat the amendments in a positive way, as these are matters that should be pressed.

After listening to the argument made by the hon. Member for Hertford and Stortford, it seems entirely appropriate that the laying of the report before Parliament should be timebound. I will be pleased to support the measure, and perhaps the Minister could see his way to incorporating it within the Bill.

The amendments are, quite fairly, concerned with ensuring that there is no undue delay in laying the accounts before Parliament. As the hon. Member for Hertford and Stortford noted, the relevant section of the schedule says:

“The Secretary of State must lay before Parliament a copy of each certified statement and report received”.

The amendments add a time limit on the Minister’s duty to lay a copy of the LBRO accounts before Parliament and the Welsh Assembly. In principle, we recognise the importance of timing in the interests of proper public accountability. The hon. Gentleman said that scrutiny was improved with speed—perhaps that was not quite the word, but certainly without undue delay—and our intention is for copies to be placed in the House as soon as the accounts have been signed off by the auditor. However, in practice, such time limits laid down in statute are uncommon. Although the hon. Gentleman is right to say that there should be no undue delay, it is accuracy that is ultimately important. The Government hope that the hon. Gentleman will not press the amendment, as a statutory deadline might work against the overriding objective of accuracy.

The wording of the amendment might unintentionally create inflexibility. The requirement to air the accounts in this way might mean that they could only be made available on dates when the House is sitting. That might make a 30-day deadline difficult to meet, for example, if accounts were presented early in the recess. We could even inadvertently cause a delay as we may need to refuse them in order not to fall foul of the statutory requirement. I am sure that that is not the hon. Gentleman’s intention, but the way that it might fall could inadvertently slow the process down.

In previous debates I referred to a couple of precedents, and I hope that the Committee will bear with me if I do so again. For example, the Natural Environment and Rural Communities Act 2006, which set up Natural England, does not set time limits for the agency’s accounts to be laid before Parliament. The Education (Schools) Act 1992, which set up Ofsted, also specified no time period for laying the chief inspector’s report before Parliament. I sympathise with the intent behind the amendment. The hon. Member for Hertford and Stortford  is absolutely right: there should not be undue delay in these matters and the Government do want to see accounts dealt with promptly.

The Minister says that he accepts the principle behind the amendment. If the Government are willing to bring forward a different time period, or an adjustment in the words, I would be happy to withdraw the amendment. It may be that actually, the Minister does not want any time limit at all.

I cannot promise the hon. Gentleman that I will bring forward a different time limit. While he is right to stress that the accounts should be laid before Parliament as soon as possible, the overriding objective must be accuracy and I would resist putting a number of days in the Bill. I hope that he will not press the amendment. If he does, I would ask my colleagues to resist him for that reason. However, I understand exactly his point about the desirability of avoiding undue delay. That is certainly the Government’s objective, but we also have the overriding objective of making sure that the accounts are right.

My hon. Friend will be asking us to vote no to a time limit. He has given a list of other Acts of Parliament that have a similar requirement with no time limit. Has a rule, a convention, a practice or a rule of thumb been developed under which there is a time that Departments aim for when they submit such documents to Parliament?

My hon. Friend asks whether there is an informal rule outside 30 days. We certainly try to deal with matters each year before we go into recess. We do not do so by a number of days, but we try to avoid undue delay. The precedents that I quoted in respect of Ofsted and Natural England do not have such time limits. I completely agree with the sentiment of avoiding undue delay, but to put a number of days in the Bill might lead us, for the reasons that I have explained, to unintended consequences. I hope that accuracy would be accepted as the main objective, and if the accounts are accurate there should certainly be no undue delay in tabling them.

In the event that the reports or accounts were published at the start of the summer recess. and thus would not be before Parliament for a period, would they still be published in some form so that people could see them or would that have to wait until Parliament sits again?

My fear is that the effect of the amendment would be that if the accounts were coming to us shortly before the summer recess, we might say that we do not have the 30 days and that it would be better to receive them after the summer recess. That would cause an inadvertent and unintentional delay. I absolutely respect and agree that there should not be undue delay, but I am not quite sure that setting down a time limit of 30 days is the correct way to ensure that.

I am grateful to the Minister and hon. Members for the debate because it is important that we can ensure that our scrutiny is effective. The presentation  of documents to this place must therefore be timely. To say that something is uncommon is one of the weakest arguments that I have come across. It is uncommon, dare I say it, for England to win the World cup, but that does not necessarily mean that it is a bad thing—[Interruption.] I shall leave that to the Scots to debate among themselves. I have veered into dangerous territory. The fact that something is uncommon does not mean that it is bad. That was a fascinating but rather irrelevant argument.

The Minister said that he recognised the merit of the fact that we need to have documentation in a timely way. I do not buy the argument that somehow inaccuracy will result. We are discussing the annual report that the LBRO is required to present to the Secretary of State. We are not talking about a time limit for the LBRO to get its accounts right, but the time from when the Secretary of State receives the documents and when he or she decides to place them in the Library of the House of Commons. The accuracy argument does not work. It might work if it was about 30 days for the preparation of the accounts. That is a perfectly legitimate argument, but it does not work in the context under discussion.

I recognise fully that 30 days is not a perfect answer, but I accept that quite understandably Ministers wish to have no trammels on their ability to act. However, we should not simply accept that. The hon. Gentleman is an honourable man. I am sure that it would be his wish and intention to present the documents in time, but we might not necessarily be dealing with him. We need to think of future Ministers and other circumstances, and need to ensure that the House can pursue its scrutiny effectively. Unless he can offer me something that would show recognition with a time limit perhaps on Report, it is not my intention to withdraw the amendments.

The debate has raised an interesting point, and I am as surprised as the hon. Gentleman that major bodies, such as Ofsted and Natural England, send reports to the Secretary of State, who then apparently has no time limit at all in which to lay them before Parliament. That is a serious omission in Parliament’s administration. If we think of something such as a Select Committee report, Ministers are required by convention, rather than a rule, to reply within two months. That would perhaps get us over the Minister’s main objection about recesses. Does the hon. Gentleman think that if he presses the amendment to a vote in the Committee, whatever the result, maybe the Procedure Committee ought to be looking more generally at all such reports and a time scale for laying them before Parliament?

The hon. Gentleman is absolutely right to say that the House, beyond this Committee—I will not stray too far away—needs to think about how we can tighten up the procedures so that there is a process. I cannot believe that Whitehall is opposed to a process, although I can understand the wish to reserve a certain flexibility, but the hon. Gentleman is absolutely right, and that is why I wish not to withdraw the amendment, but to press it to a Division to proceed with the matter.

Question put, That the amendment be made:—

The Committee divided: Ayes 6, Noes 8.

Question accordingly negatived.

Schedule 1 agreed to.

Clause 2 ordered to stand part of the Bill.