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Clause 14 - Investigatory powers etc

Trade Union Bill – in a Public Bill Committee at 10:00 am on 27th October 2015.

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Photo of Stephen Doughty Stephen Doughty Shadow Minister (Business, Innovation and Skills) 10:00 am, 27th October 2015

I beg to move amendment 53, in clause 14, page 11, line 7, leave out subsection (2).

Photo of Alan Meale Alan Meale Labour, Mansfield

With this it will be convenient to discuss the following:

Amendment 69, in schedule 1, page 18, line 4, at end insert—

‘(b) to take representations from the trade union or unions who are the subject of such an investigation”

The amendment would require a person investigating a breach of an obligation by a union to take representations from the union concerned.

Amendment 70, in schedule 1, page 19, line 4, after “Certification Officer”, insert

“and the trade union or unions who are the subject of such an investigation”

The amendment would require the interim report of the person investigating a breach of an obligation by a union to be sent to the union concerned.

Amendment 71, in schedule 1, page 19, line 7, after “Officer”, insert

“and the trade union or unions who are the subject of such an investigation”

The amendment would require the final report of the person investigating a breach of an obligation by a union to be sent to the union concerned.

Photo of Stephen Doughty Stephen Doughty Shadow Minister (Business, Innovation and Skills)

After a lively start to the Committee, we now come to the provisions of the Bill that deal with the certification officer. Although the position of certification officer is familiar to many members of the Committee, it does not normally get a lot of attention, although it will in this debate because of the huge extension and change to its remit proposed by the Government.

When we debated clause 6, we discussed how the certification officer will be given powers to gather information on industrial action taken by trade union members, and how trade unions will be required to publish details of all industrial action and ballots in their annual return to the certification officer. When read in isolation, clause 6 poses a risk to the neutrality  of the certification officer in the regulation of trade unions. When read alongside other clauses in the Bill, however, and particularly clause 14, it amounts to a vast extension to the role, remit and powers of that position. The clause will insert into the 1992 Act new schedule A3, which is schedule 1 to this Bill, and give effect to schedule 2, which also amends the 1992 Act. As a result of those changes, trade unions will face significant new obligations and further blue tape, as we have discussed, because they will have to report to the certification officer annually on when industrial action takes place and on political fund expenditure.

The provisions will give the certification officer new, wide-ranging investigatory powers on matters such as the register of members, elections, the political fund and union mergers. For example, if the certification officer thinks that there is good reason to do so, they will have the power to demand the production of any documents relevant to their investigation. Furthermore, if they believe that a union has failed to comply with its duty, they may appoint inspectors who can require the production of documents, as well as the attendance and assistance of any persons believed to have information relevant to the investigation. Failure to comply may lead to the certification officer imposing an enforcement order, which carries punitive sanctions.

The TUC believes that those new powers represent a major new intrusion by the state into union affairs and union members’ rights to privacy. The certification officer will—I find this quite extraordinary—be able to initiate an investigation against a trade union even though they have not received a complaint from a member of that union. That power applies to rules governing elections, political funds and union mergers. The TUC is concerned that the certification officer will be expected to act on complaints and intelligence provided by third parties, including employers. We need to discuss that in detail because it provides wide grounds for fishing expeditions, sabotage actions and engagement by people who are not involved in a dispute, but simply want to cause problems, and to provoke legal proceedings and investigation or action by the certification officer.

We have heard from many people who are concerned about the provisions, and such concerns were reaffirmed in oral evidence by legal experts including Thompsons Solicitors. The United Kingdom’s judicial system is lauded by many around the world, and the Minister should note how its founding principles stand in complete contrast to how the certification officer will be able to act. It is important for the Committee to understand that the certification officer will have the power to bring a complaint against a trade union, to investigate the issue, to decide which witnesses will be called, to cross-examine them, to make a decision on the matter, and then to impose a fine on the union that they have investigated and on which they have adjudicated. I cannot overemphasise the point, which was also made by many of our witnesses, that this is simply not consistent with the principles of natural justice or the founding principles of our legal system, which include many checks and balances, not least the separation of powers.

It is quite extraordinary that this is taking place in an era when we have finally done away with some of the anachronisms of our constitutional arrangements. As the  Minister mentioned, we have been having many discussions about this—I am sure that we could have a lengthy one about the other House if we wished to—and the fact is that in recent years we have moved forward. We have separated out the roles, and we no longer have the head of the judiciary sitting as the Chair of proceedings in the other place, as a member of the Executive and of the Cabinet, while that Chamber also acted as the highest court of appeal in this land. That was separated out, and we now have the Supreme Court, the independent Judicial Appointments Commission, a Lord Chancellor who is a member of the Cabinet but not of the other place, and so on and so forth. We have taken that step, and rightfully so, to separate the Executive from the judiciary and to remove the blurring of powers, yet the Government are now effectively merging all those powers together in the role of someone who, I am pretty sure, would not want those powers in the first place, and has had a very limited role until this point.

This seems to be an attempt to politicise a position so that it can be used in a very wide-ranging way, and to interfere fundamentally with the rights of trade union members up and down this country. When the provisions are considered alongside other clauses in the Bill, they do look very sinister. I am sure that the Minister will say, “Oh don’t worry, it will be fine. The certification officer will only engage once in a while if something really terrible happens,” and so on and so forth, yet he is proposing to grant huge, wide-ranging powers which, given the previous clauses we have debated, are deeply sinister. We believe that this clause and the relevant schedules are excessive, so we shall oppose them.

I turn briefly to our amendments. Amendment 53 would prevent the insertion into the 1992 Act of schedule 1, which provides for the certification officer’s new investigatory powers. Amendment 69 would provide that any person investigating a breach of an obligation by a union must allow that union to make representations before any decision is taken, which would be absolutely consistent with the principles of natural justice. I find it extraordinary that it is the certification officer who will decide which witnesses to call and to whom they will speak before making a decision. If we are talking about powers that affect the rights of trade unions, it is crucial that, at the very least, those involved should be allowed to make representations that are relevant to the matter at hand.

Amendment 70 would require any person carrying out an investigation to send the union a copy of the interim report at the same time that it is sent to the certification officer. Again, that is only fair. If such decisions are being made, at the very least the parties to the dispute should receive a copy of the report. Amendment 71 would require that the final report relating to an investigation would also be sent to a relevant union.

I hope that the Minister can explain both the intent behind these wide-ranging changes—we will come on to other parts of the role shortly—and how the process sits with the principles of natural justice in this country. I hope that he will also set out whether there will be any safeguards to prevent the officer from interfering unwillingly, or from being forced to interfere in the affairs of unions without just cause.

Photo of Jo Stevens Jo Stevens Labour, Cardiff Central

It is a pleasure to serve under your chairmanship, Sir Alan.

The Bill would, if enacted, fundamentally change the role of the certification officer from a neutral arbiter of disputes to a state snooper and enforcer. We have heard the concerns of legal experts, Liberty and others about the implications of these changes for civil liberties, and about the likelihood that they infringe article 6 of the European convention on human rights, on the right to a free trial, and well-established principles in common law on natural justice. No one should sit as a judge in their own cause.

I repeat those concerns today, for the record, in the light of the Government’s changes to the ministerial code, which were quietly sneaked out last Thursday via a ministerial statement in the other place. Until the code was changed last week, it used to refer in its opening paragraphs to an

“overarching duty on ministers to comply with the law including international law and treaty obligations and to uphold the administration of justice and to protect the integrity of public life”.

That duty to comply with international law and treaty obligations, and to uphold the administration of justice, has just been deleted from the ministerial code. It may be a complete coincidence that, at the very point when this Bill is coming under a barrage of expert criticism for its breaches of international law and treaty obligations, the Government have decided to do away with the requirement for Ministers to uphold those laws. Will the Minister explain what possible justification there is for such a change to the standards against which Ministers are held accountable? Why was not Parliament consulted on the change?

In returning to the clause and our amendments, let me be clear that I make no criticism whatsoever of the current incumbent of the post of certification officer. He has served with distinction since 2001; prior to his appointment, he was a partner in a firm of solicitors. He is respected for his impartiality and knowledge. I see from the certification officer’s website that he was last reappointed in 2012, but I do not know for what period. There is no suggestion that he asked for these wider powers, so I have a number of questions for the Minister about what consultation has been carried out with the certification officer about the transformation of his powers. Does he support the changes? What assurances can the Minister give us about the continued independence of certification officers? When will the current certification officer’s term of office expire? What safeguards will cover the appointment of his successor?

Section 254 of the Trade Union and Labour Relations (Consolidation) Act 1992 provides:

“The Certification Officer shall be appointed by the Secretary of State after consultation with ACAS.”

The Secretary of State has made his views on trade unions clear, as have Ministers. What confidence can trade unions possibly have in the independence of a certification officer who is appointed by a Government with a clear ideological agenda against trade unions, as is demonstrated by their Bill?

In reply to my question about who asked for the provision, the Minister said that the Government were acting on

“a clear proposal in their manifesto. That clear proposal was to reform the role of the certification officer.”––[Official Report, Trade Union Public Bill Committee, 20 October 2015; c. 259.]

That shows the ideological origin of these proposals. No one knew what that manifesto statement meant, and what we now see goes far beyond any reform by completely recasting the role of the certification officer and transforming it into something entirely different.

Photo of Ian Mearns Ian Mearns Chair, Backbench Business Committee, Chair, Backbench Business Committee 10:15 am, 27th October 2015

I was interested to see a TV interview this morning in which the former editor of Conservative Home suggested that the provisions with which the Government are having problems in the House of Lords were in their manifesto, but that as they did not expect to win the election, they did not expect to have to enact many things that were in that manifesto. That theory is very interesting, as it is possible that the Government did not expect to have to enact the Bill.

Photo of Jo Stevens Jo Stevens Labour, Cardiff Central

My hon. Friend makes a valid point. I think that we will see more of that during this Parliament.

What was the inspiration for the changes? The Government propose to give the certification officer a whole armoury of weapons. They will be able to investigate, demand documents, demand explanations and start proceedings, which they themselves will hear, acting as prosecutor and judge, before giving a verdict and delivering a sentence. They will be able to impose a fine and, as we heard in evidence, a quasi-criminal sanction. This is an extraordinary attack on the rule of law.

Certification officers’ powers will be extended into areas that have historically been way outside the remit of the role. The CO's role is to regulate the internal workings of unions and their relationship with their members. That is clear from the existing jurisdictions and procedures involving complaints by union members. The certification officer’s website states that his role is to

“maintain a list of trade unions…ensure compliance with statutory requirements for annual returns…determine complaints concerning trade union elections…rules” and trade union mergers,

“oversee the political funds” and

“certify the independence of trade unions”.

That work involves seven staff, and the net cost of the certification officer’s office, according to his most recent annual report of July this year, was £560,232. That represents a 3.7% decrease. Hon. Members might think that that is good value for money, yet the Government want to increase massively bureaucracy, cost and intrusion.

I also note from the annual report that in March 2015, the certification officer’s premises were found to be structurally unsafe. I fear that the proposals in the Bill are equally structurally unsafe. No longer will the CO's role be confined to legitimate complaints that are not ruled out as scandalous, vexatious, hopeless or misconceived. The real purpose of the proposals was revealed in the questions from the hon. Member for Banbury to Professor Ewing in Committee on the afternoon of 15 October. The hon. Lady envisaged the certification officer being required to take action at the behest of

“someone with a legitimate cause for complaint—someone who is affected by strike action…The certification officer himself might be able to take a view that it was appropriate to investigate non-compliance.”––[Official Report, Trade Union Public Bill Committee, 15 October 2015; c. 131, Q352-354.]

Professor Ewing was understandably perplexed by that question, as even the certification officer’s expanded role would not encompass non-compliance with industrial action requirements, yet it is clear that Government Members believe that it should, and that the certification officer should act as a state enforcer who steps in at the behest of any individual to interfere in the workings of trade unions. One can imagine that the Conservative party’s friends in the TaxPayers Alliance will be keen to waste more public money and resources by pestering the certification officer on all manner of issues and seeking enforcement orders on unions, especially in the light of the oppressive reporting requirements on industrial action and political funds.

The situation shows that the Government and Conservative Members are proceeding on the basis of a fundamental misunderstanding of the law and of the role of a certification officer. They are creating a bloated and distorted role that undermines the independence of the office and offends universally accepted legal principles. As a final insult, they will require trade unions to pay for the privilege. Under the Conservatives, we are used to attacks on trade unions, but now we will have an open-ended tax on trade unions—a blank cheque—on which unions will have no say and no control. It is taxation without representation at its most extreme, enabling ideologically motivated complaints to target union resources. It is another direct, politically driven attack on the finances of unions and their capacity to represent their members.

Photo of Chris Stephens Chris Stephens Scottish National Party, Glasgow South West

The hon. Lady is making an excellent speech. Is it not ironic that trade unions are being asked to contribute to the costs of a certification officer, but will be prohibited from contributing to employers administering check-off?

Photo of Jo Stevens Jo Stevens Labour, Cardiff Central

The hon. Gentleman makes a valid point that shows the inconsistencies throughout the Bill.

I hope that the Government will rethink their proposals on the certification officer. I believe that they should be withdrawn, as they are pernicious, and that the current role of the certification officer, which is widely respected, should be retained. To do otherwise betrays a disdain for independence, impartiality, fairness and, most importantly, the rule of law.

Photo of Ian Mearns Ian Mearns Chair, Backbench Business Committee, Chair, Backbench Business Committee

I rise to support the amendments. The clause will increase substantially the investigation powers of the certification officer, giving him or her powers to investigate the activities of a union even when a complaint has not been received from a member of that union, or from any trade union member at all. Surely the provision completely misses the point of a trade union certification officer’s role. Trade unions are independent organisations whose function is to represent the interests of their members. Whether or not this Government approve of trade unions, the fact remains that they perform a legitimate—some would say essential—role within a free society.

The certification officer performs a vital role, but that role does not and should not involve attacking the rights of trade unions and their members who, after all—apologies to my colleagues from north of the border—are citizens of the United Kingdom. The role of the  certification officer is to protect the rights of trade union members by ensuring that unions operate openly, democratically and at all times in the interests of their members. The guidance on the Bill describes the provision as giving the certification officer new enforcement powers so that action can be taken without the need for an application or complaint from a member to be received first. The certification officer will therefore be able to investigate and take enforcement action in a number of areas where that is currently not possible or appropriate. In particular, the guidance states:

“For example the Certification Officer could act upon information or concerns he had received from a third party or on his own initiative.”

That provision is totally unacceptable in a free society.

There are more than 6 million trade union members in the UK. They are all intelligent and fully capable of raising a complaint or concern with the certification officer if they have a problem with their trade union. Why does the certification officer need powers to act when not one single trade union member raises a concern? On whose complaint or on whose authority will the certification officer act? We all know on exactly whose authority that will be. Every scare story and sensationalist headline in the “Daily Wail” or the “Daily Hexpress” will be followed up. Six million members may be completely content and satisfied, but the editor of the “Daily Wail” screaming about Len McCluskey, Sir Paul Kenny or Dave Prentis having the bare-faced audacity to stand up for their members will in future be the subject of a full investigation. That is a total waste of time, and the costs of such investigations will be passed on to the trade unions, which will have no alternative but to pay.

Photo of Chris Stephens Chris Stephens Scottish National Party, Glasgow South West

Does the hon. Gentleman agree that the provision could lead to more malicious complaints being sent to the certification officer? It could lead to fascist organisations making complaints about the funding of anti-racist groups.

Photo of Ian Mearns Ian Mearns Chair, Backbench Business Committee, Chair, Backbench Business Committee

The hon. Gentleman makes a valid point. Once enacted, the provision will give the certification officer the right, or possibly even the duty, to act on any complaint, no matter its source. That is a matter of grave concern. The provision is concerning and an expensive waste of time for trade unions.

As a means of restricting the rights of trade unions and their members, the provision is nothing short of disgraceful, and that has been borne out by the evidence from a whole range of international organisations and lawyers representing many interests. The provision will turn the certification officer’s role from one of protecting trade union members into one that is highly political. They may be forced to react to politicians and newspaper editors, instead of members. Where the certification officer becomes the investigating power, they will become judge and jury over trade unions, their members and officials. Trade union members—the ones we are all concerned about with the Bill—will have to foot the bill while having no easy mechanism to hold the certification officer to account for their actions.

Photo of Nicholas Boles Nicholas Boles The Minister for Universities and Science, Minister of State (Department for Business, Innovation and Skills) (Jointly with the Department for Education)

The Government believe that it is entirely appropriate for a modern regulator to be able to investigate properly when non-compliance with statutory requirements  is suspected. The idea is nothing new, as the Electoral Commission and the Charity Commission have investigation powers that can be used proactively when they suspect a breach.

The powers are important because we want the certification officer to be able to determine as quickly and efficiently as possible whether there is a problem so that that can be swiftly remedied. If no problem is found, the quicker the doubts, representations and complaints can be dismissed, which is better for everyone concerned, including unions, employers and the public. The Bill therefore extends the certification officer’s investigatory powers into a number of areas: political funds; union mergers; union leadership elections; and the appointment of a person to, or the failure to remove a person from, a union office when they have been convicted of certain financial offences. To ensure that all the certification officer’s investigatory powers are set out in one place in statute, the Bill also replicates not-yet-commenced investigatory powers in relation to statutory requirements to maintain an accurate register of members’ names and addresses.

We want the certification officer to have investigatory powers in those areas because they relate to statutory requirements that are not only of concern to union members, but of wider relevance to the general public. Members of the public need the assurance that unions are complying with statutory requirements, and they will be given that assurance if the certification officer is able to investigate of his own volition. The investigatory powers will also allow the officer to bring in additional resources or specialist knowledge, should an investigation prove complex and technical. That will give them flexibility when choosing an appropriate inspector, including a third party, to deal with such investigations and then resolve them swiftly and effectively. It will also assist their ability to manage the certification office’s workload, should there be a sudden spike in cases.

The enhanced investigatory powers that we are giving to the certification officer are not entirely new; they are based on those that he already has in relation to a union’s financial affairs. The powers have been exercised fairly and proportionately in the past, and there is no reason to believe that that would not continue to be the case for the certification officer’s enhanced investigatory powers. We believe that the investigatory powers are necessary to ensure that there is robust and effective regulation of trade unions. Effective regulation promotes public confidence.

Photo of Ian Mearns Ian Mearns Chair, Backbench Business Committee, Chair, Backbench Business Committee 10:30 am, 27th October 2015

The Minister seems to be implying that there is zero chance of the certification officer being a political appointment in future.

Photo of Nicholas Boles Nicholas Boles The Minister for Universities and Science, Minister of State (Department for Business, Innovation and Skills) (Jointly with the Department for Education)

There is no proposal to change the appointment procedure for the certification officer. As the hon. Member for Cardiff Central reminded us, the appointment is made in consultation with ACAS. I remind the Committee that ACAS is currently run by Brendan Barber, the former general secretary of the Trades Union Congress. The idea that we are going to be able to stuff in some political stooge is somewhat far-fetched, like almost everything that Opposition Members have said during the Committee.

On amendments 69, 70 and 71, I am happy to reassure Members that a union will continue to have the opportunity to present its case in written representations to the certification officer before a declaration is made. The officer may also allow the union to make oral representations. That right will also apply before the certification officer issues a financial penalty or conditional financial penalty. In practice, a union may have several chances to reply to any allegations and put forward a defence. Any inspector appointed is likely to make a series of enquiries, which will include dealing with the union directly, before providing their report to the certification officer.

Finally, the union will be able to appeal a certification officer’s decision to the Employment Appeal Tribunal. That will ensure that a union has the opportunity to make further representations to an independent tribunal should it believe a decision made by the certification officer was unlawful. I therefore urge the hon. Gentleman to withdraw the amendments.

Photo of Stephen Doughty Stephen Doughty Shadow Minister (Business, Innovation and Skills)

I welcome the Minister’s clarification on those last points. Given that, I am content to withdraw the amendments, but I hope that when we discuss the subsequent groups of amendments the Minister will explain what other position in Government has the same range of investigatory, adjudication and enforcement powers in the hands of one individual. It would be useful to understand the sort of comparisons we are looking at. The powers are very wide-ranging and the situation is very blurred.

The Minister has given assurances that the position will remain independent and so on, but he mentioned a spike in cases: perhaps he suspects that there might be such a spike. Opposition Members have expressed concerns about the malfeasance that might be attempted by, for example, a fascist group or someone else who wanted to tie up the certification officer’s time or, indeed, a union’s finances in dealing with a bunch of illegitimate cases in order to disrupt and cause problems. That would be of great concern. I hope that the Minister can explain that in subsequent debates, but for now I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Photo of Stephen Doughty Stephen Doughty Shadow Minister (Business, Innovation and Skills)

I beg to move amendment 54, in clause 14, page 11, line 9, leave out subsection (3).

Photo of Alan Meale Alan Meale Labour, Mansfield

With this it will be convenient to discuss the following:

Amendment 55, in clause 14, page 11, line 11, at end insert—

‘(4) For the purposes of this section and the Schedules to which it gives effect complainant and applicant must be—

(a) a member of the union which is the subject of the complaint or application.”

Amendment 66, in schedule 1, page 17, line 7, leave out “or any other person”.

The amendment would restrict the power to require the production of documents to the Certification Officer and his or her staff.

Amendment 67, in schedule 1, page 17, line 47, after “obligation,”, insert

“where a complaint has been received from a member of the relevant trade union, and where there the Certification Officer reasonably believes there is evidence that indicates a breach of a relevant obligation”.

The amendment would require a complaint to be made by a union member and for the Certification Officer to reasonably believe there was evidence of a breach of an obligation before the Certification Officer initiated an investigation.

Amendment 68, in schedule 1, page 18, line 1, leave out “or other persons”.

The amendment would require a person investigating a breach of an obligation by a union to be a member of staff of the Certification Officer.

Amendment 56, in clause 15, page 11, line 16, after “32ZB”, insert

“and where a valid complaint has been made by a member of the trade union or unions relevant”.

The amendment would provide that only after a valid complaint from a union member can the Certification Officer make a declaration that he is satisfied that a union has failed to comply with the requirements for the annual return in respect of industrial action or political expenditure.

Amendment 57, in clause 15, page 12, leave out lines 16 to 19.

The amendment would prevent a union member who was not party to a complaint giving rise to an enforcement order implementing the order.

Amendment 58, in clause 16, page 13, line 3, leave out

“the applicant or a person mentioned in subsection (5B)”.

The amendment would limit enforcement powers to the Certification Officer.

Amendment 59, in clause 16, page 13, line 6, leave out “or the applicant”.

The amendment would limit enforcement powers to the Certification Officer.

Amendment 60, in clause 16, page 13, line 9, leave out

“the applicant or a person mentioned in subsection (6)”.

The amendment would limit enforcement powers to the Certification Officer.

Amendment 61, in clause 16, page 13, line 12, leave out

“the applicant or a person mentioned in subsection (5C)”.

The amendment would limit enforcement powers to the Certification Officer.

Amendment 62, in clause 16, page 13, line 15, leave out

“the applicant or a person mentioned in subsection (8)”.

The amendment would limit enforcement powers to the Certification Officer.

Amendment 63, in clause 16, page 13, line 18, leave out

“the applicant or a person mentioned in subsection (5C)”.

The amendment would limit enforcement powers to the Certification Officer.

Amendment 64, in clause 16, page 13, line 21, leave out

“the complainant or a person mentioned in subsection (4A)”.

The amendment would limit enforcement powers to the Certification Officer.

Amendment 65, in clause 16, page 13, line 25, leave out

“the applicant or a person mentioned in subsection (7)”.

The amendment would limit enforcement powers to the Certification Officer.

Photo of Stephen Doughty Stephen Doughty Shadow Minister (Business, Innovation and Skills)

The Bill needs so many amendments because of its complex nature. A lot of information and important detail is contained in the relevant schedules, and it is necessary to apply the changes that we want to make to all the relevant parts of the Bill. I will go  through the amendments briefly without repeating our arguments and overall concerns about this part of the Bill.

Amendment 54 would remove schedule 2, which includes provisions permitting the certification officer to carry out investigations, even though no complaint has been made by a union member. Amendment 55 seeks to ensure that the certification officer only carries out an investigation against a union where a complaint or application has been received either from a union member or an employer who employs union members. The amendment aims to tease out our concern about who might bring investigations or complaints.

Amendment 66 would mean that only the certification officer or his or her staff—and not inspectors—would have the power to require the production of documents from unions during an investigation. This is an important point because the Minister made a case in his comments on the preceding group about a potential spike in cases and the need for additional inspectors to help the certification officers conduct their work. That is a very worrying suggestion. While the Minister might give us assurances about the independence and conduct of the certification officer under the new role, appointing a legion of inspectors under them who have some sort of quasi-judicial role separate from existing legal authorities or police does not reassure me about the way in which they would conduct themselves. Will the Minister explain how he sees their role and what constraints they would operate under?

Amendment 67 would mean that the certification officer could only initiate an investigation if they have received a complaint from a member of the relevant union and if they believe there is evidence that the union has breached one of its statutory duties. The aim is to ensure that the certification officer—or one of the inspectors—does not initiate investigations on their own volition or go on fishing expeditions through union records when they have not received a complaint from union members. Does the Minister believe that the certification officer would be allowed to undertake such investigations without complaints being made by a relevant party, particularly where a complaint from the union member involved has not been received? In my view, certification officers should not have the ability to wander around initiating investigations here, there and everywhere without any just cause.

Amendment 68 would mean that only the certification officer or members of his or her staff could investigate a union. Amendment 56 would mean that the certification officer could only make a declaration that a union has failed to comply with the new reporting requirements if they had received a valid complaint from a member of the relevant union. Again, this is to ensure that the certification officer does not initiate investigations on their own volition if no one has complained. Amendment 57 would prevent a union member who was not a party to the relevant complaint seeking to enforce an order made by the certification officer.

It is a very odd set-up where, on our reading of the legislation, somebody who is not involved at all could look at a decision that has been made and then seek to enforce the order. If that is not the case, can the Minister confirm that on the record? The role of organisations such as the TaxPayers Alliance has already been commented on. Many individuals and organisations would attempt to undertake vexatious expeditions, perhaps on the  back of fishing, to attempt to enforce orders against trade unions, which would already have spent quite a lot of their own funds in dealing with the complaints. They would potentially then have to fight attempts by another individual who was not even involved to try to enforce the orders made under this clause and the schedules.

Amendments 58 to 65 would further limit the enforcement powers of the certification officer and define their role rather than that of others who might be involved in potential enforcement. The amendments are designed to tease out various concerns we have about the way in which the legislation is drafted and would be applied in practice. I will be interested to hear what the Minister has to say and whether we seek to press any of the amendments to a vote.

Photo of Nicholas Boles Nicholas Boles The Minister for Universities and Science, Minister of State (Department for Business, Innovation and Skills) (Jointly with the Department for Education)

On amendments 54, 55, 56 and 67, the current enforcement regime is limited. With the exception of statutory duties in relation to financial records and as of next year the membership register, the certification officer may only make inquiries and take action following a complaint from a union member. That is not satisfactory. A modern regulator should be able to take action as appropriate where they suspect that there has been a potential breach of statutory duties or obligations. That is not new: the Electoral Commission and the Charity Commission both have such powers. The powers will enable a certification officer to take enforcement action once he has made inquiries and only if satisfied that there has been a breach of statutory duties or obligations in relation to the new reporting requirements. It would be wrong to restrict the exercise of the certification officer’s powers simply to responding to a complaint as the amendments seek to do, so the Government cannot support them.

Amendment 67 additionally seeks to change the test for the use of the officer’s powers of investigation. Currently, the officer may request documents when it is believed there is good reason to do so and appoint an inspector in circumstances that suggest a trade union has breached a duty. The amendment would require the certification officer reasonably to believe that evidence indicates a breach of duty.

It is important to note that the amendment relates to the test of the use of investigatory powers, not the basis on which the certification offer can make a determination that there has been a breach. Of course, there must be evidence and investigatory powers are about gathering that evidence. The tests we propose for the use of the investigatory powers are essentially the same as those that apply to the officer’s long-standing powers to investigate potential breaches of financial affairs under the 1992 Act. Those tests have been in place for a long time.

The investigatory powers are intended to assist with determining whether there has been a breach. The officer will still have to give the union the chance to make representations and then be satisfied that a breach has actually occurred before taking any enforcement action. If a trade union believes that the certification officer has acted beyond his powers or that the officer has made a mistake in applying the law when reaching a decision, it can still appeal to the Employment Appeal Tribunal. I therefore believe that adequate safeguards are already in place.

I turn to the enforcement of the certification officer’s orders. Amendments 57 to 65 aim to restrict the enforcement of orders to the officer exclusively. In tabling the  amendments, the hon. Gentleman seems to be under the impression that we are trying to subcontract enforcement of the officer’s orders to individual union members. I assure him that that is not the intention. We simply seek to reflect the current situation in which complainants and other members of the relevant trade union are entitled to apply to a court to enforce obedience with the officer’s orders. That is nothing new; indeed the 1992 Act is clear on that point.

Photo of Stephen Doughty Stephen Doughty Shadow Minister (Business, Innovation and Skills)

Will the Minister clarify whether he believes it would be reasonable for someone who was not a party to a dispute—the TaxPayers Alliance, for example—to attempt to enforce an order or be involved in such an enforcement?

Photo of Nicholas Boles Nicholas Boles The Minister for Universities and Science, Minister of State (Department for Business, Innovation and Skills) (Jointly with the Department for Education)

As I think I just explained, it is currently the case under the 1992 Act that complainants as well as other members of the relevant trade union are entitled to apply to a court to enforce obedience with the certification officer’s orders. If such a body had been a complainant, there had been a process and the certification officer had made an order, under the provisions of the 1992 Act it is entitled to apply for enforcement of that order. There is nothing new in that; that has been in place since 1992 and, needless to say, throughout the period of the previous Labour Government.

Amendments 66 and 68 seek to restrict investigation activities, including the power to demand documents from a trade union, to the certification officer’s own staff. I understand concerns in relation to data protection and confidentiality, but the ability to appoint a third party gives the officer discretion to identify an inspector with specific expertise or simply to bring in additional resource should that be necessary.

Some investigations might be complex, technical and lengthy, so the officer’s permanent team may not have the time to carry them out. The amendment would reduce the officer’s flexibility in choosing an appropriate inspector to appoint, should such a case arise. It is important to note that the ability to authorise or appoint people to assist with investigations in that way is not new. It is exactly the same as the options currently available as part of the certification officer’s long-standing powers to investigate financial affairs. All the Bill does is to provide similar powers of investigation in relation to other potential breaches.

Photo of Stephen Doughty Stephen Doughty Shadow Minister (Business, Innovation and Skills)

I want to test the Minister a little more on inspectors. He says that there is nothing new, but he spoke previously about a potential spike in cases leading to an increased need for inspectors to help the certification officer carry out their duties. Will he tell the Committee—if he cannot do so now, perhaps he could write to us—how many inspectors would be required, whether there would be a cap on the number of inspectors that the certification officer could appoint, where those costs would be met from, whether there would be any cap on the cost and what sort of qualities would be required in the recruitment and employment of those inspectors by the certification officer?

Photo of Nicholas Boles Nicholas Boles The Minister for Universities and Science, Minister of State (Department for Business, Innovation and Skills) (Jointly with the Department for Education) 10:45 am, 27th October 2015

I am happy to write to the Committee with that information. I would like to correct something that I said previously, in case I created a false impression.  I had not understood that a complainant has to be a member of the trade union. Under the 1992 Act, any member, whether a complainant or another member, can enforce the certification officer’s orders. That is what we propose to replicate for these other powers. Except in the unlikely event that the TaxPayers Alliance decided to join all the trade unions that it wanted to complain about, it is unlikely that it would be in a position to enforce those orders.

Photo of Stephen Doughty Stephen Doughty Shadow Minister (Business, Innovation and Skills)

So just to clarify, it would not be appropriate for vexatious individuals outside the dispute, who were not members, to attempt to involve themselves in the enforcement of orders or the investigations.

Photo of Chris Stephens Chris Stephens Scottish National Party, Glasgow South West

Just so I am clear, is the Minister indicating that he is amenable to amendment 55, which would provide that the complainant must be a trade union member? He said earlier that he was going away to consider some aspects of picketing, in relation to what could be defined as outside interference.

Photo of Nicholas Boles Nicholas Boles The Minister for Universities and Science, Minister of State (Department for Business, Innovation and Skills) (Jointly with the Department for Education)

No, I am not indicating that, but we believe that the Bill already makes it clear who has the power to complain and who has the power to enforce. Moving on, I have explained that the appointment of investigators is not new; it happens under existing powers regarding the investigation of financial matters, and the Bill simply extends it to other potential breaches. The new investigatory powers contain specific provisions to impose a duty of confidentiality on any inspector that the certification officer appoints to prevent the unauthorised disclosure of personal information about union members. I therefore ask Opposition Members to withdraw the amendment.

Photo of Stephen Doughty Stephen Doughty Shadow Minister (Business, Innovation and Skills)

The Minister has provided helpful clarification on a number of points, but I am still not convinced that there are enough safeguards built into the Bill concerning the role and extent of investigations, and the basis on which they are made. He has said that the Bill does not change what was there before, but it will massively extend the powers of the certification officer, so I think it is only right that we look at defining limitations to those investigations, adjudications and enforcements. We may table other amendments at later stages and I would like, at the appropriate point, to press to a vote amendment 67, which would establish limits to ensure that the certification officer does not go on fishing expeditions where they have not received complaints.

Amendment, by leave, withdrawn.

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

Photo of Alan Meale Alan Meale Labour, Mansfield

With this it will be convenient to discuss the following:

New clause 7—Certification Officer

“For subsections (2) to (4) of section 254 of the 1992 Act substitute—

“(2) The Certification Officer shall be appointed by the Judicial Appointments Commission, and the person appointed shall have expertise in trade union law.

(3) There shall be a Certification Officer for Scotland, equal in status to the Certification Officer in subsections (1) and (2) above.

(4) The Certification Officer for Scotland shall be appointed by the Judicial Appointments Board for Scotland, and the person appointed shall have expertise in trade union law.””

New clause 10—The Certification Officer—

“In section 254 of the 1992 Act (The Certification Officer) for subsections (2), (3) and (4) substitute—

“(2) The Certification Officer shall be appointed by the Judicial Appointments Commission, and the person appointed shall have expertise in trade union law.””

Photo of Nicholas Boles Nicholas Boles The Minister for Universities and Science, Minister of State (Department for Business, Innovation and Skills) (Jointly with the Department for Education)

The previous two groups of amendments afforded us the opportunity for extensive debate on clause 14, so I do not propose to speak at length about it. It extends the certification officer’s investigatory powers and enables the officer to exercise a number of those powers without a complaint from a trade union member. It is entirely appropriate for a modern regulator to be able to investigate properly where non-compliance is suspected.

I turn to new clauses 7 and 10, and I remind the Committee that the provisions in the Bill, including those that relate to the certification officer, concern employment law and industrial relations matters. They are about how trade unions act and how they should be regulated. Those remain reserved matters for Westminster and are not devolved to Scotland or Wales. In my view, the provisions should apply across the whole of Great Britain, and I do not propose to rehearse devolution arguments here. I note, however, that section 254 of the 1992 Act requires the certification officer to appoint an assistant certification officer for Scotland and allows for the delegation of functions relating to trade unions based in Scotland to that assistant certification officer for Scotland. I believe, therefore, that the 1992 Act sufficiently caters for Scotland’s needs and that appointing a separate certification officer for Scotland is not necessary, especially since the 1992 Act provides a regulatory framework for the whole of Great Britain.

Turning to the proposal that the Judicial Appointments Commission should be responsible for the selection and appointment of the certification officer, I do not agree that the certification officer is a judicial office. Currently, the certification officer has a range of functions—administrative, investigatory, regulatory and adjudicatory —all of which are important aspects of the office. Hon. Members will note that the Bill further increases those investigatory and regulatory functions. It would not be correct, therefore, to describe the certification officer as a judge or other holder of judicial office.

It has been long-standing practice that the certification officer should be a ministerial appointment; a practice not, I believe, challenged or questioned by the previous Labour Government. Such appointments are typically made following Department for Business, Innovation and Skills public appointments practice: a panel, which includes an independent panel member, as well as representatives from the CBI and the TUC, considers applications and makes recommendations to BIS Ministers. In making its recommendations, the panel must only put forward names of candidates that are appointable—that  is, who have demonstrated competence to perform the role. It is then for the Secretary of State to make the final decision on whom to appoint. This is nothing new and certainly nothing unusual.

I am keen to stress that the certification officer is, and always has been, independent of Governments of whichever party. Ministers have never directed what the certification officer does. Indeed, no one has suggested otherwise since 1975, when the office was set up. The certification officer is appointed by the Secretary of State after consultation with ACAS, but as his annual report, deposited in the Libraries of both Houses of Parliament, points out, he is independent from both ACAS and the Secretary of State for Business, Innovation and Skills. As the Committee knows, we want to enhance the role of the certification officer to ensure robust and effective regulation of trade unions. We want to modernise this regulatory role to bring it up to date with a new, modern system for industrial relations. Our changes increase the regulatory aspects of the role. The Government do not therefore think that appointment of the certification officer by the Judicial Appointments Commission is appropriate.

Turning to the proposal that the certification officer should have expertise in trade union law, I agree, of course, that the certification officer should have knowledge of trade union law, but I do not believe that it is necessary to prescribe this in legislation, primarily because to do so risks limiting the range of candidates that could perform the role in future. In any case, the recruitment panel will only recommend to Ministers appointable candidates for the role of certification officer and those candidates will need to demonstrate to the panel that they have full competency for the role. For these reasons, I ask hon. Members to withdraw the new clauses.

Photo of Stephen Doughty Stephen Doughty Shadow Minister (Business, Innovation and Skills)

I am somewhat bemused by the Minister’s comment that the certification officer is not a judicial officer. He has explained the wide powers that the certification officer has, so I am very interested to know what positions the Government consider to be comparable. Most people would consider the certification officer to have a quasi-judicial role, at the very least, and therefore we need some very strict controls about how it is regulated. The crucial point is that we are moving well beyond the original role set out for the certification officer. As my hon. Friend the Member for Cardiff Central said, this is not to comment on the suitability or the work that has been done by the current certification officer, who, from all my experience and that of the stakeholders I have engaged with, has done a very good job, but this is a complete change in the role and its powers. That change requires a fresh look at how the certification officer is appointed.

Our new clause would provide that the certification officer in Great Britain would be appointed by the Judicial Appointments Commission. Currently, as we have heard, the role is appointed by the Secretary of State for Business, Innovation and Skills in consultation with ACAS. The Minister went through the process of shortlisting and so on, and obviously, it is great that a number of stakeholders are involved. However, of course the final decision rests with the Secretary of State and that, again, gives wide latitude to a Secretary of State to veto or to appoint someone partisan or political. Given the nature of the rest of the Bill, many of us might strongly suspect that that would happen.

The Secretary of State for Business, Innovation and Skills of course regularly consults many different stakeholders, but as we saw in debates about the steel industry he seems willing to ignore all the advice and carry on regardless. I have no faith as to whether things would continue in that vein, when I consider the intent and purpose of the Bill.

We all agree that the certification officer should be independent of Government and required to have expertise in trade union law rather than just knowledge of it. Demonstrable knowledge could be an ability to list by rote the clauses of the Bill. Someone who takes such a wide range of powers needs a detailed understanding of the provisions. The 1992 Act does not specify the qualifications required, but the Bill gives the certification officer extensive new powers and remits, and it is only reasonable to expect the person appointed to have expertise in that regard, particularly given the various aspects of the role.

If the Minister intends to reject the new clause, will he explain what consultation, as a minimum, he would expect for the new role? Will things just carry on as they do under the old system, with the limited involvement of the TUC, CBI and so on at the shortlisting stage, or does he envisage a wider range of people being involved? Will he give wider assurances about the type of qualifications and other requirements? Given the nature of the proposed role, we believe that the certification officer should be appointed by the Judicial Appointments Commission—that is only right—and that there should be a clear requirement for expertise in trade union law.

New clause 7 is essentially similar to our new clause in its purpose; I understand why the hon. Member for Glasgow South West and his hon. Friends have tabled it, in relation to Scotland. As I have said before in similar debates, we want the fairest settlement in the Bill for workers and trade union members across the UK, and I hope the hon. Gentleman understands that that is what we intend with our new clause. It would deal with the whole of Great Britain, not just Scotland.

Photo of Chris Stephens Chris Stephens Scottish National Party, Glasgow South West

As the shadow Minister said, the new clauses really deal with who should be the certification officer. If the powers are being enhanced, the new role needs to be reconsidered, because—the shadow Minister is correct—it is at the very least quasi-judicial. The aim of new clause 7 is to ensure that the holder of the post has adequate qualifications and expertise.

The Minister has said he expects the person appointed to have expertise in trade union law, but his successors may not. An adequate provision would make it clear, as the new clause does, that the certification officer should have expertise in trade union law. It cannot be someone we met down the pub, who may be able to recite all the clauses of the Bill. It needs to be someone of a very high standard, with expertise in trade union law, who knows the intricacies of that law. More importantly, the person should be independent of Government, and that is why it is appropriate in the circumstances to involve the Judicial Appointments Commission.

The new clause has another purpose. As the Minister pointed out, there is currently an assistant for Scotland. The enhanced role will have an impact on elections where they are now devolved to the Scottish Parliament, in terms of Scottish parliamentary and local government  elections. If there are questions about election funding, that will be a Scottish issue and we believe it would require a certification officer in Scotland to consider it.

Also, there are differences between the legal jurisdictions. There is different civil and criminal law in Scotland, and we believe the new provisions about the certification officer can only impinge on the consideration of civil and criminal law in relation to complaints and so on. The effect of the certification officer provisions will be that Scotland will need not an assistant but a certification officer of equal status to the certification officer for Great Britain.

We have no issue with new clause 10 and we will support it in a vote, but we are seeking a Scottish provision of equal status due to the impacts that the new role of a certification officer will have.

Photo of Nicholas Boles Nicholas Boles The Minister for Universities and Science, Minister of State (Department for Business, Innovation and Skills) (Jointly with the Department for Education) 11:00 am, 27th October 2015

We do not accept that the Bill would dramatically expand the certification officer’s role. We are simply replicating the investigatory powers that he already has in relation to financial matters with regard to the new matters that he will have the power to investigate, so we certainly do not see any basis for changing how he is appointed. Previous Governments who were happy for him to have those investigatory and regulatory powers in relation to financial matters thought the arrangements for appointment were adequate. I commend clause 14 to the Committee and ask Members to resist new clauses 7 and 10.

Photo of Stephen Doughty Stephen Doughty Shadow Minister (Business, Innovation and Skills)

To clarify, we will press new clause 10 to a vote at the appropriate point.

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

The Committee divided: Ayes 10, Noes 8.

Division number 31 Decision Time — Clause 14 - Investigatory powers etc

Aye: 10 MPs

No: 8 MPs

Ayes: A-Z by last name

Nos: A-Z by last name

Question accordingly agreed to.

Clause 14 ordered to stand part of the Bill.