I welcome you to the Chair, Mr Benton. We were discussing clause 109, and I had begun to deal with whether it would comply with the requirements under the European convention on human rights. I want the Minister to consider a situation in which a business had previously been granted a permission for a licence, but that permission had been taken away, with the result that the business lost its ability to trade and its existing good will, even though that was in the absence of any problem or evidence to justify the conditions being attached to the licence. Would the convention have an effect on the clause?
Many of the submissions that Committee members have received state that it is crucial to retain the “necessary” test for conditions, rather than move to the “appropriate” test in the clause. Licensing authorities can already impose without difficulty the conditions that they need to promote the licensing objectives. The vast majority do not find the evidential burden too restrictive. Again, I ask the Minister to give the Committee the evidence to explain why the clause is necessary.
For those who have experienced difficulties with a lack of representations being made by responsible authorities about problem premises, the Bill, as we debated earlier, makes licensing authorities responsible authorities, which means that they will be able to tackle problem premises in their own right, rather that just relying on evidence supplied by other responsible authorities.
Furthermore, the changes proposed to the definition of vicinity, which we discussed earlier, will ensure that local residents who are directly affected by issues arising from licensed premises will be able to make representations where they felt restricted, or were restricted, in doing so before. It must be recognised that licence conditions impose additional costs and restrictions on businesses, so they must be clearly necessary. They must be essential to justify the additional burden on the premises. The Government often talk about the need to support businesses and to ensure that support is available for them locally, regionally and nationally, and they want to restrict the burden on businesses, so I would ask the Minister to consider carefully the burden that lowering the evidential burden in the clause could impose on local businesses. We must remember that a lot of premises and businesses that hold licences are small and medium-sized and they are often family-run, so it could be difficult for them to deal with any additional burden.
Let me give an example of where necessary conditions and appropriate conditions might help us. If there were a large number of glass-related incidents at a premises, that premises could be forced through a licence condition to use polycarb glasses instead of glass. That would be necessary to promote the licensing objectives of public safety and the prevention of crime and disorder. However, it is questionable whether it would be appropriate to impose that condition if there were no incidents for the licensing authority to look at and use as evidence for deciding to enforce it.
Many different conditions could be considered appropriate for most, if not all, licensed premises, but they certainly would not be necessary for the vast majority, which are well-managed and responsible businesses. Some of the conditions would relate to plastic glasses, CCTV, door people and the duplication of existing legislative requirements. The Minister must answer this question: would it be appropriate to specify that certain types of establishments, for instance country pubs, must have someone on the door? I would argue that that is not necessary, but a licensing authority could take the view that it would be appropriate.
I would also like to refer to the impact assessment that has been produced. I looked carefully at the increasing costs that businesses would have to meet if additional conditions were attached to their licences. The only specific estimate that the assessment makes about cost is the cost of employing additional staff on the door of licensed premises. The assessment states that the cost of door staff would be between £300,000 and £600,000 a year. It also states that an additional 10% to 20% of premises could be required to have security staff if the evidential burden is lowered to the criterion of “appropriate”.
I urge the Minister to look at the conditions that could be attached to a licence that could be expensive for businesses, for example CCTV. For small country pubs, that might be a cost that they have not considered before, and one that would be disproportionate. The clause potentially creates a lot of bureaucracy and uncertainty in the industry about what conditions are appropriate, and there could be a further raft of appeals to test what “necessary” and “appropriate” mean. I understand that making an appeal to a licensing authority costs on average £1,235, which again would be an additional cost to businesses.
Is it not the case that words such as “necessary” and “appropriate” are similar in many respects to words such as “self-defence”, which are not susceptible to easy definitions? This is an issue of fact, degree and individual or instant taste. Is it not the case that the Labour Administration, having produced a quantity of legislation that surpasses in volume all previous understanding, was not too reticent about troubling the courts with legislation in that regard?
I know what the hon. Gentleman is saying. Earlier today, I quoted legal advice received by the Association of Licensed Multiple Retailers, which looked at the definition of “appropriate”. I accept that it is a subjective view, which is why there is uncertainty about what it will mean. One issue that has been raised in many of the submissions that we have received is that the Licensing Act 2003, which has been enforced for five years, and is bedding in—people are beginning to understand and appreciate exactly what the law means and what they have to do. However, it is a stage at which we are seeing more upheaval. I am not sure that evidence has been produced to make the case for including the clause, so I am interested to hear what the Minister has to say. Is there a lot of evidence that we are not privy to at the moment that means that the clause is necessary?
I have discussed the additional costs to businesses and an average cost of more than £1,200 to make an appeal which, in difficult economic times, is something of which we all have to be mindful. Will the Minister to explain clearly why the clause is necessary? Where is the evidence that the word “necessary” is a problem, and that we have to adopt “appropriate” if licensing authorities are to require different conditions for licences?
I welcome you to the Chair this afternoon, Mr Benton. The distinction between “necessary” and “appropriate” is the main thrust behind the arguments of the hon. Member for Kingston upon Hull North. Currently, licensing authorities are expected to grant premises licence applications unless they receive relevant representations about the impact of an application on the promotion of the licensing objectives, which they can consider appropriately and examine whether they are necessary. The hon. Lady has examined the distinction that has been brought to bear on the proposal to reduce the evidential threshold.
The hon. Lady has raised several interesting issues, including in connection with the evidence base and the steps taken. She is right that a lot of representations have been made over the years in respect of whether someone is prepared to take a particular step. Some local authorities feared that a particular condition or step the sought to take would not be regarded as necessary. Worried that they would be subject to a legal challenge, they adopted quite a defensive approach.
We decided to consult to gain the views of local authorities and all interested parties, and we included such matters as a key part of the exercise. Significant elements of the consultation highlighted whether the concerns that we had been picking up during an extended period were borne out. The majority of those consulted were supportive of the proposed lowering of the threshold from “necessary” to “appropriate”. We have also received anecdotal evidence about that. The consultation itself was an important part of the evidence base, as was asking people the direct question, “Is this is an issue? Is this a defensive approach”. Our sense is that local authorities have been defensive in the assessment of the necessary requirement, which was partly why we introduced the measure.
Does the Minister have worries about the consultation itself? A number of criticisms are made in the submissions about how short the consultation period was, and about the fact that it took place over the summer when it was perhaps difficult for some people to engage in a consultation.
We engaged properly, and we received well over 1,000 responses. It was a well-subscribed consultation. Indeed, we staged several important road shows and stakeholder events throughout the country to garner evidence and information. It was a proper process. We wanted to listen to views carefully and, we actively went out to ensure that we received responses and that the matter was considered properly.
The distinction that we are seeking to draw goes to the heart of what the hon. Lady flagged up earlier. On the definition of “appropriate”, she suggests that it will create a new legal minefield and that matters will be highly problematic. Before lunch, she read out a definition of “necessary” and, in part, the word “necessary” is defined in guidance issued by the Home Office and the Department for Culture, Media and Sport, which had the policy lead on those issues at that time. Guidance was issued because the term “necessary” is not defined in statute. By its nature, it is likely to be interpreted on a case-by-case basis. What may be necessary in one circumstance may not be necessary in another.—[Interruption.] I can see that my hon. Friend the Member for Northampton North is interested. I do not know whether the clock is running in relation to the advice that he may be able to proffer on this matter.
Even the term “necessary” has a subjective element, and the same would apply to the word “appropriate”. The hon. Member for Kingston upon Hull North read out a definition, but it is not binding on a court, as definitions have to relate to a particular statute. If the hon. Lady’s Government were concerned about that, they would have sought to define the term “necessary” in the Licensing Act 2003, and they did not do so. One could argue that there was a risk of lots of cases and litigation arising because the word “necessary” was not defined in the Act, but from the advice that I have received that has not been the case. That is partly because of the statutory guidance to the Act, and that it is the approach that we are seeking to take with the term “appropriate”, which we are introducing in the Bill in this particular clause.
Is it not the case that, if we have not seen a large number of appeals and cases being challenged in the period in which the term “necessary” has been used for conditions to be attached to licences, it is working relatively well? If so, why the need to move to the word “appropriate”?
My argument relates to the defensive approach that local authorities are taking. That is what we are hearing, and that is why we consulted; because of that reluctance, a very cautious approach is being taken. That is what we are saying about rebalancing. The hon. Lady will know that the consultation was called “Rebalancing the Licensing Act”. In many ways, the Government sought to say that the Licensing Act was all about communities and giving greater local discretion to local authorities, yet the term “necessary” has militated against that, because it has led to a defensive approach by local authorities and local councils when deciding what they should do about particular provisions.
Focusing on the distinctions that we are seeking to draw between the definitions of “necessary” and “appropriate”, there is a qualitative difference between the two terms. For a decision to be “necessary” to promote the objectives, the decision maker must be satisfied that no lesser steps would suffice. That is what the guidance indicates and that has become custom and practice. The guidance states that licensing authorities should ensure that any conditions that they impose are only those which are necessary for the promotion of the licensing objectives, which means that they must not go further than what is needed for that purpose. In other words, it is more about holding back rather than giving that slightly wider discretion that we now seek to give.
A decision that is “appropriate” for the promotion of the licensing objectives provides some flexibility to consider the effects of the decision on the promotion of the objectives. It may therefore be decided to take steps that are suitable for, rather than necessary to, the promotion of the objectives. It provides an element to deal with that reluctance or resistance, to enable local communities to assert themselves properly in relation to this particular approach. However, a decision that is appropriate for the promotion of the objectives remains a decision that can take into account as a factor only the promotion of the objectives, and no factor outside the statutory defined parameters. In other words, as we debated at length this morning, the requirements of the four licensing conditions would apply. It was for that reason that alternative criteria—we could have sought to use different words, such as “beneficial”, and did sought proper legal advice for the terminology used in the Bill—were not used. We felt that that would take that a step further and might cloud the issue.
The statutory guidance will be amended to provide licensing authorities with advice on how to determine whether an action is appropriate. Again, that builds on the advice and guidance, and may deal with the hon. Lady’s concerns that the measure may become some sort of lawyers’ charter, although we do not anticipate that that will be the case. We therefore set out the regulatory impact assessment after considering those points carefully.
Is it possible for the Committee to look at the draft guidance to see how the Department intends to define “appropriate”? That might be helpful not only to Committee members but to wider interest groups, which are raising such concerns.
The hon. Lady will know that it is custom and practice for the guidance and statutory measures that are required in relation to legislation to be published only after the Act is enforced, because there may be changes as legislation proceeds. However, we will provide statutory guidance, because it is helpful, as has been the case with statutory guidance on the existing law. We want to assist licensing authorities and the way in which they consider and deal with the issues. It is worth mentioning that we have to consult publicly on changes to guidance, so in introducing new guidance, there will be an opportunity for questions to be raised and points to be addressed.
The hon. Lady also highlighted the issues of ECHR compliance, and that is a fair point. We have sought advice, as she would expect, in terms of the normal ECHR statement, which appears in the Bill. We have considered the matter carefully and believe that the measure is compliant with ECHR requirements. There are legal rights of appeal and this will not seek to prejudice matters. I hope that the hon. Lady has listened carefully to my response. Concerns have been expressed by various parties and we have examined the issues carefully. We believe that the provisions strike an appropriate balance in relation to the evidential threshold.
On the intention of the Licensing Act, the hon. Lady will remember the debates that took place and the fact that the Act was intended to give local communities a say—a right—and the ability to determine what should happen as the powers were transferred at that stage from the magistrates court to local authorities. We are seeking to rebalance, not to throw everything out. There should be parameters, which is why the licensing objectives are there. It is important to give provide flexibility, so that councils and communities do not feel the nervousness that we sensed from the feedback to the consultation. On that basis, I hope that the hon. Lady will recognise the arguments and agree that the clause should stand part of the Bill.