Enterprise and Regulatory Reform Bill

Public Bill Committee, 12 July 2012.

Clause 49 - Sunset and Review Provisions

Iain Wright (Labour, Hartlepool)

I beg to move amendment 93, in clause 49, page 41, line 35, at end insert—

‘(2A) Prior to the subordinate legislation coming into force, the review of the effectiveness of the legislation as set out in 14A(2)(a) will receive the views of businesses, business organisations, civic organisations and trade unions, and any such organisations which the person considers appropriate.’.

Good morning, Mr Bayley. It is a pleasure to see you back in the Chair for our deliberations on this sunny morning. I am pleased to be back in the driving seat after a number of sittings in which I was not. I want to thank my hon. Friends the Members for Edinburgh South and for Newcastle upon Tyne Central, who probed and scrutinised the Bill’s provisions on employment legislation and competition and mergers with good humour, forensic skill and professionalism. I wish the Minister had taken on board the important points that they raised. In fact, they did far too good a job for my liking, so I will stop praising them now.

It is a particular delight to welcome the hon. Member for Newton Abbot after her feisty, if terrifying, performance at Prime Minister’s questions yesterday. She has served in Committee with great dedication. I can now see how she got that arm in a sling. She was no doubt involved in a violent and bloody brawl in a bar, presumably looking for anecdotal evidence for the Committee from a man down the pub. I dread to think what the other bloke looks like, but presumably we should convey our sympathies to his family. Given the hon. Lady’s performance yesterday, I was tempted to withdraw all amendments to avoid any broken bones and for a quiet life. However, as it is a sunny day and I feel rather feisty myself this morning, I think I will chance my arm.

On the subject of amendments, the British Retail Consortium stated in its written submission to the Committee:

“We welcome the intention of the introduction of sunset clauses and other deregulatory measures in the Bill, such as those on tv licence administration. However, we are not optimistic that these will all deliver their potential, given our experience with the Red Tape Challenge and One in, One out. We need to see genuine sunset reviews when the term is up, with a formal role for stakeholders.”

I think we agree with the need for a formal role for stakeholders. Businesses and other relevant stakeholders should be able to shape the Government’s thinking on business policy in general and sunset provisions in particular. It is of little help to businesses and the wider economy if somebody in Whitehall decides, unilaterally and without consultation, to apply sunset provisions when businesses or other groups might consider them to be successful or not in need of termination. The purpose of the amendment is to add an additional subsection to clause 49 to ensure that, prior to any sunset provisions being implemented, the review of the original legislation would include the views of businesses affected by that legislation and its possible repeal.

Business organisations such as the CBI and the Federation of Small Businesses, as well as trade unions and any other stakeholders considered appropriate, will also have a view. I do not think the amendment is contentious. It is a means of ensuring that business policy is not dictated to businesses and enterprises, but is produced in full consideration of them and in consultation with them. I hope the Minister will take advantage of this beautiful sunny morning and start as he means to go on. I hope he will feel able to accept the amendment.

Anne Marie Morris (Newton Abbot) (Con) rose—

Jeremy Wright (Conservative, Kenilworth and Southam)

I am really frightened of the hon. Lady, so before I formally sit down, I will just say please don’t hurt me.

Anne Marie Morris (Conservative, Newton Abbot)

I thank the shadow Minister for giving way. May I ask him what thought he has given to the practicality of implementing his amendment, and indeed the cost of such representation? I understand the thought behind the amendment, but in terms of the additional cost and burden, has he looked at what it will amount to and how practical it is, even though the idea is a good one?

Hugh Bayley (Labour, York Central)

Well, answer that, Mr Wright!

Jeremy Wright (Conservative, Kenilworth and Southam)

I will do my very best, Mr Bayley. I should not have taken that intervention. It was far too good a question.

The hon. Lady makes an important point. On sunset clauses generally, we will discuss the fact that everything around the clause and the review of legislation and around regulation in general needs to be proportionate. I am not suggesting a full, wide and potentially expensive consultation exercise, but channels are already in place for Ministers and officials to speak with the affected organisations and businesses. There is a small window of opportunity in which businesses and stakeholders can say that they agree with what the Government are trying to do, or that they disagree and want the Government to consider something else. As I have said, we need to ensure that business policy is not dictated to businesses, but is produced in full consultation with them.

Chi Onwurah (Newcastle upon Tyne Central) (Lab) rose—

Jeremy Wright (Conservative, Kenilworth and Southam)

I shall give way. I am getting used to it now.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

In intervening, I am following my hon. Friend’s example. Although it is important to minimise the costs of engaging with stakeholders and business, does he agree that if the Government do not invest in such engagement and ensure that they hear as many views as possible, they will be more subject to undue influence from lobbyists and those who can afford to put their views across?

Jeremy Wright (Conservative, Kenilworth and Southam)

I certainly agree with my hon. Friend. In many respects, large organisations have the ear of Government because they can employ public relations or lobby organisations. I am thinking of small and medium-sized enterprises being able to have their say as well.

In response to my hon. Friend, a lack of consultation, or even of just saying, “Do you think that this is a good idea?”, means bad legislation and bad policy. We have seen that time and again from successive Governments. If things happen unilaterally, ill-thought through legislation is the result. I mention that because it is a good case study for how not to make business policy. As for the feed-in tariff decision, there may have been a need to change the tariff, but to have done it with sufficient time for businesses to plan, adapt and consult would have meant better outcomes for everybody and for industry all around. I hope the Minister is in a generous mood this morning. He certainly looks happy and content with his lot. On that basis, I hope that this very reasonable amendment will be accepted with very little delay.

Mark Prisk (Conservative, Hertford and Stortford)

Welcome back to the Chair, Mr Bayley. We look forward to your firm but fair stewardship. It is a sunny morning, and I hope that we can maintain our deliberations in a positive fashion. As the hon. Gentleman has said, strengthening the review of new regulation is fundamental, which is why we have set out a comprehensive approach to both sunsetting and reviewing. We should all accept the fact that the record of successive Governments, of all colours and hues, in ensuring the systematic review of regulations has been rather poor. That has led to a large volume of obsolete, burdensome and, very often, out-of-date regulation, which is why we have been trying to tackle it through the red tape challenge and other measures. Our policy on sunsetting will help to avoid the same problems occurring in the future.

I understand that the intention of the amendment is to strengthen the process of conducting reviews by introducing a formal statutory requirement on the Minister responsible so that the review receives the views of businesses, civic leaders and so on. Let me say clearly to the Committee that the Government are already committed to the principle of engagement, with stakeholders forming a vital part of the review. Indeed, paragraph 39 of our sunsetting guidance already states that

“in carrying out reviews, Departments will need to consider how best to gather information and views from businesses, civil society organisations, and others affected by the regulation.”

It goes on to note that

“a formal consultation may form a valuable part of this process.”

Additionally, to promote transparency and encourage stakeholder input, Departments are encouraged to publish a forward schedule of planned reviews so that businesses can see exactly what is coming up. However, it is important for practical reasons that Departments retain some degree of discretion as to how to carry out the review, what evidence to use, and how to engage with those affected by the review. For example, a sectoral review that might affect a handful of businesses, or where the effectiveness is easily measured, is likely to require a less extensive process than something that might involve hundreds of thousands of business premises. Indeed many businesses say to us, “Please ensure that you do these consultations on”—and the hon. Member for Hartlepool used this phrase himself—“a proportionate basis”. Where something is clear, specific and narrow, we should not go in for the same rigid approach that might be more important in a more substantial measure.

Geraint Davies (Labour, Swansea West)

In reference to that, UK carbon pricing, which was introduced by the Chancellor without consultation with Tata Steel in my area, is outside the normal pricing for the European zone. It will disadvantage Tata in Britain, giving it an incentive to go elsewhere in Europe. That is an example of where consultation could have been used effectively, given that after the event, there was a certain amount of back-pedalling.

Mark Prisk (Conservative, Hertford and Stortford)

If the hon. Gentleman knows the steel industry, he will know that the Government were actively engaged in that matter when the primary legislation and secondary legislation were being proposed. However, he is right. That is one of the areas in which we want to ensure that consultation is appropriate and is with the right number of stakeholders.

Ministers also need to consider the views of Departments and agencies responsible for enforcing the regulations, particularly when that highlights issues regarding the practical implementation of the regulations and opportunities to streamline compliance and burdens. On a technical point, the Minister responsible for the review is, under existing administrative law, already obliged to consider any submissions made to him or her in relation to the review. In that sense, the amendment would duplicate an existing legal requirement.

The Government are committed to engage stakeholders as part of the process of gathering evidence to feed into a review. The hon. Member for Hartlepool is right that that is an important principle, and we entirely agree. That includes Ministers considering any views or representations received in connection with a review. The evidence shows that that can be delivered without an additional statutory prescription and in a way that allows for an approach to be tailored to the circumstances of each review. I understand the intention, and it is entirely appropriate. However, on those re-assurances, particularly regarding proportionality, which he highlighted, I hope that the hon. Gentleman will consider withdrawing the amendment, having got those important points on to the record.

Iain Wright (Labour, Hartlepool)

I thank the Minister for his thoughtful response. I have read closely the sunset guidelines produced by his Department. It is a good document that should set the benchmark for what happens to ensure that we can repeal unnecessary and burdensome regulation and legislation. That is a good focal point for that. He is right: a lot of the points that I have tried to raise in the amendment are mentioned in the guidelines.

The Minister’s response to me centred, quite rightly, on proportionality. I absolutely agree with that. In my response to the hon. Member for Newton Abbot, I said that I do not think it appropriate to have a full-scale consultation on what is almost universally considered to be an acceptable repeal of a piece of legislation. However, I think it was important that we got on the record that businesses, business organisations, trade unions and other stakeholders should be consulted on the matter. Business policy-making together between the Government and relevant stakeholders will always make for better legislation, regulation and policy.

Geraint Davies (Labour, Swansea West)

That said, does my hon. Friend accept that the Government need to do better? People planning a caravan holiday eating pasties this summer were a bit thrown about whether their budget would stretch to pay the tax.

Iain Wright (Labour, Hartlepool)

My hon. Friend makes a fair point. We are now coming to the end of our deliberations in Committee. We will finish next week, as will Parliament, for the summer recess. I would imagine that many hon. Members are thinking about caravan holidays stacked full of pasties; I certainly am.

My hon. Friend makes an important point. Legislation that has not been well thought through and that lacks consultation with stakeholders means bad legislation and a sense of incompetence from the Government. We have seen that from the Chancellor regarding the Budget on a number of matters. I mentioned feed-in tariffs, which is a particularly good example. We have seen it time and time again.

Julian Smith (Conservative, Skipton and Ripon)

Will the hon. Gentleman give way?

Iain Wright (Labour, Hartlepool)

It is great to have the hon. Gentleman back.

Julian Smith (Conservative, Skipton and Ripon)

Does the shadow Minister accept that the proposals on sunset clauses were made by various regulatory organisations and leaders under the previous Government, but they were totally ignored? I am sure that he will welcome the fact that this Government are introducing them and taking action.

Iain Wright (Labour, Hartlepool)

That is slightly harsh. The hon. Gentleman must have got out of the wrong side of the bed this morning. I have put on the record two or three times that we do not have a problem with the basic premise behind clause 49. We want to tighten the language and help as much as possible. We want to make business policy as pro-business as possible, in consultation with business.

Julian Smith (Conservative, Skipton and Ripon)

Why did Labour not do it in government then?

Iain Wright (Labour, Hartlepool)

The hon. Gentleman asks from a sedentary position why we did not do that in government. I will come on to that in connection with another amendment.

The Minister has made some reasonable points, such as the one about proportionality. I am pleased to have put our concerns on the record and with the manner of his response. On that basis, I beg to ask leave to withdraw the amendment.

Iain Wright (Labour, Hartlepool)

I beg to move amendment 94, in clause 49, page 42, line 10, at end insert—

‘(7) Subordinate legislation identified as having ceased to have effect in 14A(2)(b) will cease to exist only on one of two prescribed dates.

(8) The dates as set out in 14A(7) will be 6 April and 1 October (known as the Common Commencement Date).

(9) The Secretary of State must publish a Statement of new Regulations at least three months before new regulations come into force.

(10) The Statement of New Regulations must include—

(a) new regulations which will come into force at the next Common Commencement Date;

(b) regulations that cease to have effect in subsection 14A(2)(b).’.

Like the previous amendments, amendment 94 is pro-business. Despite my warm words, I was disappointed that the Minister could not show his support for business with the previous amendment. Perhaps he can this time round.

In my role as shadow Minister for competitiveness and enterprise, I speak with businesses every day. The one common thing they say they require from Government more than anything else—whether it is the ability to fire people at will, or any other piece of legislation—is certainty. Provide businesses with a stable and certain policy environment, in which Government decisions are made—in consultation with businesses and other stakeholders—adhered to and announced with sufficient time for businesses to plan and adapt, and businesses will have the ingenuity, entrepreneurial skill and flair to do their bit to boost the economy, create growth and provide employment opportunities.

Conversely, if there is an uncertain environment, in which businesses are unsure of the general business policy direction of the Government, the Government lack a “compelling vision” for the economy—as the Secretary of State for Business, Innovation and Skills stated, far more eloquently than I could—and there are ad hoc, knee-jerk and ill thought-through policies announced without due consultation with businesses or sufficient time for them to adapt, investment and confidence will undoubtedly plummet.

Ian Murray (Labour, Edinburgh South)

I am grateful to my hon. Friend for giving way, because a prime example of the situation he outlines in his compelling speech is what happened with feed-in tariffs, and what that did, not just to the industry, but the 40,000 or so workers in the industry in Scotland.

Iain Wright (Labour, Hartlepool)

My hon. Friend is absolutely correct. I have frequently mentioned that the feed-in tariff decision is a good example of how not to conduct and implement business policy. I have a lot of affection for my hon. Friend, who is obviously a future Minister, as opposed to my role as a former Minister. Had he been here on time, he would have heard me talking about feed-in tariffs. I hope he has to stay late tonight to make up for that.

Furthermore, if the Government tinker or micro-manage, rather than set a broad road map for businesses to follow, uncertainty and instability increase again. Frequent changes to regulation are bad for business, as companies and entrepreneurs will not be aware of the regulations and at what time they should comply with them. The Institute of Chartered Accountants in England and Wales, of which I am a member, has stated that reviews on sunset clauses and other regulation could lead to minor changes that would lead to a net increase in the regulatory burden for businesses.

Julian Smith (Conservative, Skipton and Ripon)

Will the hon. Gentleman give way?

Iain Wright (Labour, Hartlepool)

I knew the hon. Gentleman could not resist.

Julian Smith (Conservative, Skipton and Ripon)

Will the shadow Minister say what action he took in government to reduce the six regulations per working day that the Labour Government—the anti-business party—imposed on British business?

Iain Wright (Labour, Hartlepool)

The hon. Gentleman needs to calm down. If he is patient, I will come to that in the clause stand part debate. I am trying to be helpful to the Government in setting out the great record of what we provided. Let him be more patient for a couple of minutes—or a couple of hours, depending on how I feel.

Ian Murray (Labour, Edinburgh South)

I am grateful to my hon. Friend the former Minister for giving way so generously. Does he agree that we have missed the hon. Member for Skipton and Ripon?

Iain Wright (Labour, Hartlepool)

It was not the same without the hon. Gentleman. I do not know whether he was ordered off the estate by the Prime Minister and the Whips for certain things that happened this week, but I am sure he is a loyal and obedient member of one of the governing parties.

To go back to the amendment—I am sure that will please you, Mr Bayley—businesses tell me time and again, “Government should just tell us what they want to do, in enough time to help us do it, and then do it, and we can cope with everything else.” In a nutshell, that is the purpose of the amendment. It attempts to ensure that changes to regulations, particularly the sunset provisions in the clause, come into force or end their period in force on only one of two dates in a year. We have chosen 6 April and 1 October, because those dates are already familiar to businesses from the regulatory environment.

Common commencement dates were established by the Chancellor of the Exchequer in his pre-Budget report in December 2004 to ensure that administrative burdens on business were reduced as much as possible. I say to the hon. Member for Skipton and Ripon, “There you go”—in 2004, if not earlier, we recognised the need as much as possible to make things simple and to remove the unnecessary burden of regulation for businesses. The amendment proposes that the sunset clauses will cease to have effect on only one of two dates, and that the Secretary of State must publish a statement of new regulation at least three months before new regulations come into force or sunset regulations cease to have effect. That is to give businesses clear notice of what will be required and on what specific dates.

I expect the Minister will say that the Government are already committed to such a thing, as they publish a statement of new regulation three months prior to regulations coming into force, so there is no need for the amendment, but we disagree. We support the principle behind sunset clauses, as I have now said for the fourth or fifth time. Indeed, we support the notion of having a statement of new regulation, which is important in allowing businesses to plan thoroughly and comprehensively and in trying to reduce the administrative burden as much as possible.

The amendment is needed because the Government are not complying with their own principles. The April 2011 statement of new regulation did not give three months’ notice for any changes to regulations and even included changes that had occurred three months previously. As I understand it, the September 2011 statement of new regulation was backward-looking, hardly giving businesses time to prepare and providing no prior warning of regulation changes. There was hardly any progress with the April 2012 statement of new regulation, which again included no changes to regulations three months prior to their coming into effect, but included some changes that had occurred four months earlier. That means that business does not have adequate time to plan, adapt and make use of what is coming along.

Although we can give the Government the benefit of the doubt and presume that they have good intentions—and I believe that this Government and this Minister have good intentions—statutory muscle is needed to back up their intentions. That is the purpose behind the amendment and, given my explanation, I hope that the Minister will accept it.

Mark Prisk (Conservative, Hertford and Stortford)

I am grateful to the hon. Gentleman. I do not know if the rest of the Committee noticed, but I noticed just a hint of possible bitterness in that he alluded to himself as “a former Minister” and talked about his hon. Friend as “a future Minister”, but then slipped in the phrase:

“Had he been here on time”.

I think their coalition is beginning to fracture, which is a very concerning issue. I will not tempt your patience further, Mr Bayley, but I will not refer to the hon. Gentleman as “the former Minister”, which is a very unkind suggestion. As I said earlier, it is not the autumn of his career—it is possibly late winter—but we will get on to that later. If I may say so, I am very pleased by his supportive comments. Indeed, he was correct to say that the last Government introduced common commencement dates, and it was good to hear his support for, for example, the statements of new regulation.

Turning first to the part of the amendment relating to common commencement dates, I stress that the Government are absolutely committed to the principle of CCDs for new domestic regulation affecting business. CCDs are essential in supporting businesses in managing their own compliance activities as efficiently as possible. With respect to sunset dates, the Government’s policy is that the date on which a regulation ceases to have effect should be seven years after the date on which it comes into force—clear and simple. Where the regulation comes into effect on a CCD—although not all measures do—the sunset date will also fall on a CCD. In that sense, there is no additional benefit from prescribing this requirement, which is suggested in the amendment.

The proposed amendment as currently drafted may have an unintended important flaw. As it would apply to all subordinate legislation, it would also apply to temporary legislation that was outside the scope of the common commencement date policy. That would apply, for example, to temporary social security legislation or temporary traffic regulation, such as that related to the Olympics. In those cases, the Committee will understand that there may be legitimate reasons for the legislation ceasing to have effect other than on 6 April or 1 October, but that would not be allowed by the amendment as drafted. Although clearly not its intention, if the amendment were passed, we must consider that that would be the unfortunate effect.

Turning to the provisions related to the statement of new regulation, I first welcome the Opposition’s support. The statement plays an important role in providing both transparency for business and accountability for Departments, particularly in relation to the one in, one out rule. The Government are also committed to continuing to improve the statement. The hon. Member for Hartlepool is right to say that the first statement did not give sufficient notice, which is why we will publish statements a full three months ahead of common commencement dates. The statement can also be improved by ensuring that those measures that we are scrapping as part of the red tape challenge are incorporated. I have also asked the Better Regulation Executive to examine how we can provide an overview of forthcoming measures that transpose European legislation, because that is something that businesses want to see in advance.

In future, I certainly expect that regulations that are no longer applicable as a result of sunsetting will also be included in the statement. It is essential that we maintain the forward momentum and continue to improve and develop the statement. Indeed, several business organisations have put suggestions to us, and we have been able to incorporate them. The Government have been able to do that without the need to formally enshrine the statement in legislation. In fact, I would have concerns that recasting the statement as a formal statutory requirement would act as an unwelcome constraint and make the statement less responsive as events change and develop.

Julian Smith (Conservative, Skipton and Ripon)

Can I ask the Minister to go down a side road and briefly talk about regulatory budgets and how they would impact on this sort of amendment? Regulatory budgets are suggested by a number of business organisations. I welcome what the Government have done on statements, but are such budgets a possibility?

Mark Prisk (Conservative, Hertford and Stortford)

The one in, one out arrangements—without stretching too far beyond the amendment—are based not necessarily on the number of measures, but on the net cost to business, so it is entirely about Departments looking at their regulatory budget and asking, “Are we bringing forward a measure that will incur an additional cost? If so, we need to work to our budget to ensure that we actually reduce the commensurate amount.” It is about capping that number. The principle of getting the costs is right. Whether we move on to a more sophisticated Department by Department budget, measure by measure, is more complex. We want to cap the cost and get Departments to understand the cumulative burden, which is more likely to have an immediate effect. However, my hon. Friend’s suggestion is an interesting thought for the future.

I am grateful to the hon. Member for Hartlepool. I hope that my explanation of the Government’s policy, with particular regard to common commencement dates and improving the statement of new regulation, is helpful. I hope that the hon. Gentleman is reassured that the intended benefits of the amendment will be achieved, but without the need to include the measure in primary legislation. Equally, I hope that he will realise that, as it is currently drafted, there is a serious, albeit unintended, flaw.

Chris Ruane (Labour, Vale of Clwyd)

Atishoo!

Mark Prisk (Conservative, Hertford and Stortford)

There is a serious something else going on here.

Given those two points, I invite the hon. Gentleman to withdraw the amendment.

Iain Wright (Labour, Hartlepool)

In response to the Minister’s opening remarks, I confirm that there is no split in the Opposition. I am merely bitter that we have incredible Front-Bench talent, such as my hon. Friends the Members for Edinburgh South—he seems to agree with that remark—and for Newcastle upon Tyne Central, while I am in the autumn of my days, thinking about the career that I could have had. Perhaps the Minister should think about sunset clauses with regard to my own career; I think the Leader of the Opposition is certainly considering that.

The Minister has made an important point, and I accept that the drafting of the amendment would create a flaw in respect of temporary regulation. That is a fair point. As with the previous amendment, I hope that we have been able to put on the record the importance of ensuring that the regulatory environment is as clear-cut as possible for businesses, so that they can plan and adapt. They must be confident that they will need to comply with the regulation until a certain date, after which it will no longer apply. That was the reasoning behind the amendment, but I accept what the Minister has said. Given the points that we have put on the record, and given the Minister’s response, I beg to ask leave to withdraw the amendment.

Hugh Bayley (Labour, York Central)

Does the hon. Member for Skipton and Ripon want to speak?

Julian Smith (Conservative, Skipton and Ripon)

I do not wish to speak.

Iain Wright (Labour, Hartlepool)

I was watching the hon. Member for Skipton and Ripon and I wondered whether he was trying to catch your eye, Mr Bayley. He was using the most ingenious method of doing so, which was to avert his gaze completely, so I was a bit concerned.

As I have said about five or six times, we broadly agree with the concept of sunset clauses when it comes to regulation, because they are often sensible and appropriate. As with a lot of things, however—to pull an old cliché out of the bag—the devil is in the detail. It would be useful if the Minister could outline which regulations should be only temporary in nature. He has mentioned, for example, traffic for the Olympics, and recent measures were introduced concerning Sunday trading during the Olympics. It would be helpful, however, if he were to outline what sort of regulations should come to an end after seven years.

I am sure that the Committee agrees with the notion expressed on the website of the Department for Business, Innovation and Skills that in the field of regulation:

“It is essential that the Government’s evaluation procedures fit together, in order to: allocate resources effectively and efficiently; avoid duplication of time and effort; exploit any synergies; ensure that evaluation of policy is effective; and, assess properly the existing policy landscape and learn from previous experience in the design of new policy.”

I am pleased to see some Government Members nodding—at least, those hon. Members who are still awake—because those comments were published by the previous Labour Government. According to the evidence, businesses are either unimpressed by or unaware of the Government’s regulatory reform efforts. The majority of business is simply unaware of the much-vaunted—at least by Ministers—one in, one out scheme. In the latest enterprise survey by the Institute of Chartered Accountants in England and Wales, which was published in January, 68% of businesses said that they were unfamiliar with the one in, one out initiative. We must do more than merely raise awareness, however. Among the companies in the survey that were familiar with the initiative, almost 80%—a quarter of all the businesses that were interviewed—felt that it would not help their businesses. Only 6% of all respondents were both familiar with the initiative and of the opinion that it would help to tackle the regulatory challenges that they faced.

Businesses currently feel that the Government are presiding over a deteriorating climate for business. In 2010 the ratio of business-friendly to non business-friendly, in terms of attitude to the UK regulatory and tax environment, was 50:48. That is, businesses felt in the last year of the Labour Government that on balance the regulatory and tax environment was supportive of business. In the last survey that ratio had deteriorated alarmingly to 44:53.

Ian Murray (Labour, Edinburgh South)

What were those figures again?

Iain Wright (Labour, Hartlepool)

Forty-four to fifty-three.

Significantly, small and medium-sized enterprises, which we all agree are the lifeblood of the economy and the area that the Government need to nurture and tend for economic growth and employment creation, tend to be less positive about the regulatory and tax environment than larger firms. That may be because they do not, as we have already discussed in Committee, have the human resources departments to deal with many of the things in question.

For medium-sized firms we need a UK equivalent of the German Mittelstand, promoting great engineering and other businesses such as the German economy has. In 2010, the last year of the Labour Government, 55% of medium-sized firms said that the environment was generally business-friendly. In 2011 the proportion of businesses that said the tax and regulatory reform environment was generally business-friendly was 38%.

In different markets and territories, according to the ICAEW survey, the UK was seen as less positive. That was true in comparison with businesses in the Americas, Asia-Pacific, the Gulf and Africa. Even Europe was seen as more business-friendly with respect to the national regulatory and tax environment.

I raise all that to show that while clause 49 is something to consider and in many respects—I think this is the seventh time now—the Opposition agree with it, the notion that it will be a magic panacea for the economy is ludicrous. It is judged, if it is judged at all by businesses, as populist. The red tape challenge and one in, one out sound good; but if we drill down there is nothing meaningful there to help the economy, or to help businesses with their day-to-day running, and promote growth.

Julian Smith (Conservative, Skipton and Ripon)

The hon. Gentleman is talking complete rubbish. Regulation is one of the major challenges for a business. The clause is part of a suite of measures that the Government are taking: the red tape challenge, the moratorium on new regulation on businesses, the statement, and the removal of individual regulations. It is not the sexiest area of Government policy, but that does not mean it is not important. The Minister is doing more about regulation than any Minister in recent history.

Iain Wright (Labour, Hartlepool)

The hon. Gentleman can say all that, but it is not I who say that the environment is deteriorating: it is businesses at the coal face who day to day must deal with Government Departments, and are not even aware of such things as the red tape challenge or one in, one out. When they are aware, they think, “It is nothing that helps me, or that is relevant to my business or my chances of business success.” We need to listen to businesses about this.

As I said, the idea of being able to reduce the regulatory burden on businesses as much as possible, to allow them to flourish and thrive, while protecting such things as health and safety and employment rights, is vital. The Opposition certainly support that. We do not want regulation for its own sake. [Interruption.] I cannot believe that people on the coalition Benches sound astonished when an Opposition Member says that. It is true. We want an environment where businesses thrive. My concern is that people who run businesses are not even aware of the regulatory reform that is taking place, and when they are they do not feel that it is relevant to their business.

Geraint Davies (Labour, Swansea West)

Does my hon. Friend agree that, to be fair to the Government, one reason businesses are more irritated about regulation than they were under Labour is that growth has collapsed? The phone is not ringing because of the double-dip recession and they have nothing to do. They fill in a few forms, which they would have to do anyway, which would normally be a small part of their working time, and now there is not enough work to do. It is just a symptom of the Government’s grotesque economic failure.

Norman Lamb (Liberal Democrat, North Norfolk)

Thanks for being fair.

Iain Wright (Labour, Hartlepool)

I was worried when my hon. Friend talked about being fair to the Government, but I think he pulled it round spectacularly in the end.

I agree with my hon. Friend, and think that what he said was balanced, and it is important. Businesses are concerned about regulation. They want to get rid of unnecessary burdens, but they also want a more favourable economic policy from the Government.

Members may have seen the front cover of the Financial Times this morning, the first paragraph of which reports:

“The head of Britain’s biggest employers’ group has strongly criticised the government for the ‘really disappointing’ implementation of its growth plan, asking: ‘Where are the diggers on the ground?’

John Cridland, the director-general of the CBI, said members of the government appeared to be ‘dazzled in the headlights’, resulting in a lack of progress on growth seven months after George Osborne set out his plan to stimulate Britain’s sluggish economy.”

So the growth plan is not working; it is simply not working. Businesses want regulation removed. Regulatory reform is important, but more than tinkering with employment legislation to make firing people easier, as the Committee has already discussed, businesses want a credible plan for growth with the Government ensuring stimulus to create employment opportunities and a competitive vision for the future economy. We simply do not have that.

Lorely Burt (Solihull) (LD) rose—

Iain Wright (Labour, Hartlepool)

I hope the hon. Lady, who regularly defends the Government, appreciates that we have no growth and the Government do not seem to be doing anything about it.

Lorely Burt (Liberal Democrat, Solihull)

I am grateful to the hon. Gentleman for giving way.

I am sure the hon. Member for Swansea West is right when he says that so much business confidence and perception of how well things are going is predicated on growth. The Government are doing all they can to encourage growth. The clause, however, is not about growth; it is about improving the business environment and enabling the introduction of sunset provisions that were not introduced by the previous Government.

I am confused. Why is the hon. Member for Hartlepool saying that business is not aware of the regulations that Governments introduce, or, in this case, ensure the disposal of at an appropriate point so that the regulations do not outlive their time, when his Government introduced five regulations every day?

Mark Prisk (Conservative, Hertford and Stortford)

Six.

Lorely Burt (Liberal Democrat, Solihull)

I beg my hon. Friend’s pardon. Is the hon. Member for Hartlepool therefore saying that, because nobody noticed that the previous Government introduced six regulations each day, we should not worry and business will be happy to continue?

Iain Wright (Labour, Hartlepool)

I think that was an intervention, but it is the longest speech of the morning.

The hon. Lady, with the greatest respect, says that I am addressing the need for growth, which is not covered by the clause or the Bill. She is right. We are discussing, line by line, an Enterprise Bill that is meant to foster a competitive environment for UK firms, ensuring that they can both compete within the British economy and export their goods and services to the rest of the world. We want wealth creation and employment opportunities, and the Bill provides neither. The Bill tinkers around the edges. There are bits with which we agree, such as sunset provisions. My point is that it is not me criticising the lack of response on regulatory reform—more important people than me are saying that—but businesses. Again, on regulatory reform, which is what we are considering in the Bill, businesses have not heard of the red tape challenge or the one in, one out initiative, and when they have heard of them, they do not feel they are relevant to their business; businesses feel that they are populist claptrap that has no impact.

Let me return to my remarks.

Hugh Bayley (Labour, York Central)

A good example of self-regulation.

Iain Wright (Labour, Hartlepool)

I am tempted to have a sunset provision at about 10.20.

Businesses are distinctly underwhelmed by the Government’s proposals and lack confidence that anything meaningful or positive will come from them. On that basis, and given what businesses are saying on the red tape challenge and the one-in, one-out policy, which do not seem to be hugely successful, as well as the wider point about regulatory reform, will the Minister outline precisely, without recourse to guff, the steps that he plans to take? Is it only a question of communicating more effectively, as businesses somehow do not understand, or is there the need to come up with meaningful proposals that are relevant to businesses in this country?

I am also interested in the Minister’s views on transparency in the field of regulatory reform, when it comes to decision making. I suggest that a lack of transparency or empirical evidence—where have we heard that before?—in the way that regulatory burdens and associated savings are measured undermines the Government’s stance. Let me give an example: the Government have claimed, and announced with relative fanfare, that reduction in regulation saved businesses a total of £7 billion in 2011. We would all support that, but the figure was subsequently revised down, rather like the downwards revision to the economic growth forecasts, to £3.3 billion by the Regulatory Policy Committee.

Mark Prisk (Conservative, Hertford and Stortford)

Could the hon. Gentleman clarify where he has drawn the figure of £7 billion from? The statement of new regulation, which we referred to, is very clear, identifying that it is £3.3 billion net at this stage. Is the £7 billion entirely within one in, one out, or is he looking at other measures, too?

Iain Wright (Labour, Hartlepool)

I am not familiar with that specific detail, if the Minister wants me to clarify those comments. My point was that the original announcement was that £7 billion had been saved, which was revised to £3.3 billion.

Mark Prisk (Conservative, Hertford and Stortford)

I am happy to confirm that as far as I am concerned it has always been clear throughout the statement of new regulation that £3.3 billion was the position, certainly until April. We expect to update that shortly, but the figure of £7 billion is not something that I have included in the statement of new regulation. I hope that that corrects the record, and I am sure the hon. Gentleman will accept that point.

Iain Wright (Labour, Hartlepool)

I am very grateful for the Minister’s clarification, but the wider point about transparency and ensuring that we can see the advice given on regulatory reform still stands. My basic question is: in order to provide clarity to businesses and improve transparency, will the Government publish the Regulatory Policy Committee reports?

In his written ministerial statement of 22 March 2011, the Minister said, on sunset clauses and guidance:

“The Government’s intention is that all measures that are in scope will be subject to a statutory review obligation, with those domestic measures implemented through secondary legislation also subject to a sunset provision. For secondary legislation, implementation in each case will be subject to the vires under which the relevant regulations are made.”—[Official Report, 22 March 2011; Vol. 525, c. 49WS.]

I would like a point clarified, for my own personal ignorance more than anything else. There is generally a presumption against retrospective effects of legislation. Is it therefore the case that there is no retrospection or retrospective element to the clause? I do not think that there is a means of providing an opportunity to, as an extreme example, abolish the minimum wage through a sunset clause, but will the Minister confirm that? The phrase I would like clarity on from the written ministerial statement is

“all measures that are in scope”.

On the basis of the clause’s content and my questions, will the Minister confirm that this will be new regulation, once the Bill is enacted? Although I am pretty sure that that is the case, clarification would be helpful.

Ian Murray (Labour, Edinburgh South)

My hon. Friend is making a key point. The red tape challenge was hugely criticised in its early days for asking, as the first question at the top of its website, whether we should be dismantling the Equality Act 2010 and whether we should repeal the Disability Discrimination Act 2005. The Minister must clarify that important point, because the Home Secretary had to come to the House and confirm that that was not the red tape challenge’s intention.

Iain Wright (Labour, Hartlepool)

My hon. Friend makes an important point. I will give the Government the benefit of the doubt and try to be fair. There has always been a presumption against retrospection in legislation, and I am confident that the clause does not affect existing regulations on the statute book, but clarity would be helpful. Given the general support that we have, the specific questions that have been asked on the relevance of regulatory reform, and the issues that I have raised, it would be helpful to hear what the Minister has to say.

Mark Prisk (Conservative, Hertford and Stortford)

I must say, I do enjoy the hon. Gentleman’s sense of irony. He says that the Labour party does not regulate for regulation’s sake. Well, you could have fooled me. The fact that in 13 years there have been six new regulations every working day tells us all we need to know about the Labour party’s record.

Ian Murray (Labour, Edinburgh South)

The Minister and the Government keep citing six regulations a day without giving us an example of what those may have been. When businesses or the Government are challenged on what regulations they would like to see removed, they do not tell us. I should like to give the Minister some examples: the Gangmasters Licensing Authority, the national minimum wage, maternity pay, the Equality Act, the Disability Discrimination Act, the health and safety legislation that stops people being killed at work—171 construction workers were killed last year alone—those are six regulations, and what a hell of a day that would be.

Mark Prisk (Conservative, Hertford and Stortford)

I will give one simple example. The previous Government put in regulations designed to ensure that workplaces where employers and employees work are made safer. A perfectly nice idea and perfectly sensible, except they forgot to put the right measures in, so it applies to businesses where there is only one person. Under a set of regulations designed for multinationals and introduced by the previous Government, a self-employed sole trader now has to write to himself to tell himself what it is that he is making sure is safer. Clearly everyone can see that that kind of workplace regulation is nonsense and needs to change. We are going to change it.

Iain Wright (Labour, Hartlepool)

The Minister cited one example. Can he give the other five for that particular day?

Mark Prisk (Conservative, Hertford and Stortford)

Well, I do not know which particular day that measure was on. I suspect that I would stretch your patience, Mr Bayley, but I am happy to give one more example. I suspect that we could be here all day.

David Mowat (Conservative, Warrington South)

I also note that the regulation referred to in that intervention was a very good regulation. But would the Minister agree with me that if the Opposition are regulating at the rate of 2,000 a year, they will not all be nonsense?

Mark Prisk (Conservative, Hertford and Stortford)

One would hope they might achieve that. That is a very good point. Let me return to the clause, or you will rule me out of order, Mr Bayley.

The Government’s policy on sunsetting regulations was set out in guidance in March 2011. Where regulation is no longer needed, or where it imposes a disproportionate burden, sunsetting can help remove that burden. In other cases, it will keep regulation up to date and support improvements where necessary. We are just over a year into the implementation of the new policy. In the period to April 2012, some 88 pieces of new legislation contained a sunset or review clause. A good example would be the change of the alcohol licensing provisions under the Police Reform and Social Responsibility Act 2011.

At present, the ability to include a sunset or review clause for secondary legislation is dependent upon the legal powers or vires under which that legislation is made. In many cases, resolving questions around the legal powers absorbs significant legal resource and slows down the process. In a minority of cases, where the vires are found not to be sufficient, it can frustrate the implementation of the policy altogether. The clause will support the implementation of the Government’s policy on sunsetting regulations by allowing sunset and review provisions to be included in any future secondary legislation where appropriate. Its effect will be to remove the issue of legal powers as a barrier to implementing that policy.

The clause inserts a new section in the Interpretation Act 1978, which sets the legal framework for issues of statutory construction. The new section has the effect that, where there is a power or a duty in primary legislation to make subordinate legislation, a review or sunset provision may be included in that subordinate legislation. That includes cases where other subordinate legislation is being amended. It does not include subordinate legislation made by Scottish Ministers, using powers in UK primary legislation that have been devolved. The changes introduced by the Bill are purely enabling. They do not require the inclusion of a review or sunset provision, or prescribe the form that any review should take. We feel decisions on those issues should be a matter of policy, taking into account the circumstances in each case.

Julian Smith (Conservative, Skipton and Ripon)

The Institute of Directors and other business organisations have encouraged us to make this clause more forceful and to go towards mandating the review or sunset provision. Will my hon. Friend comment on those views? I encourage him, if he feels so inclined, to be even more radical than he has been already since becoming a Minister.

Mark Prisk (Conservative, Hertford and Stortford)

I am always tempted by the strong free-market principles of my hon. Friend. The problem with mandating the review or sunset is that there are examples where it would not be appropriate. A good one would be the insolvency rules. If people knew that those rules were about to be reviewed or removed altogether every five or seven years, there would be a cloud of uncertainty in the 18-month period before that about whether the current insolvency rules would operate in the future. There are some instances where making the review or sunset clause mandatory in secondary legislation is inappropriate. The expectation is that it will be an exceptional case where a sunset provision or a review is not included, but making it mandatory will take it one step further, which could have an unintended consequence.

On the question of retrospectivity, the hon. Member for Hartlepool is absolutely right. There is no retrospective element in this, which is entirely appropriate.

Let me turn to the benefits of the clause. First, it will mean that legal powers are no longer a barrier to routinely implementing the sunsetting of regulations where there are new burdens on business. That means that regulations will no longer assume the permanence we sometimes see, regardless of whether they are having an entirely detrimental effect.

Secondly, it means that the review of regulations will be more transparent—the hon. Gentleman made that point—and timely. I particularly highlight the fact that we are looking to strengthen the role of the Regulatory Policy Committee and that, unlike before the election, it independently audits all the costs. We have also ensured that the Department that sponsors a regulation is no longer able to set the cost. The cost has to be independently audited. That point on transparency is important.

Thirdly, the benefit for business is that identifying and implementing improvements to existing regulation will be much more straightforward. It will be a given that we improve regulations and ensure that they are up to date. In that sense, the clause will also help improve the scrutiny of regulations by Departments and by Parliament, because these measures will be coming back to us to consider.

The hon. Gentleman mentioned the CBI. John Cridland said in reference to the Bill that the big prize for business will be to major on a new power for sunset clauses on regulation. That is what the clause does. The proposals set out in clause 49 will support a robust and enduring system for review and will improve our legislation. That is good for business and the parliamentary process, and on that basis I hope that the Committee approves the clause.

Schedule 16 - Heritage planning regulation

Iain Wright (Labour, Hartlepool)

As I think the Minister will have gathered from the fact that we did not have a clause stand part debate on clause 50, we are not opposed to the specific measures in the schedule. Indeed, when we were in government, we prepared something similar in the Heritage Protection Bill. I had a small role to play in that when I was not a former Minister, as I am now, but an actual real-life Minister—happy, happy days—as the Parliamentary Under-Secretary of State in the Department for Communities and Local Government with responsibility for planning. We think that the merging of conservation area consent and planning permission is sensible and should not have an adverse effect on heritage protection. We certainly agree with the notion that heritage protection can enhance and be a lever for economic growth, so we support what the Government are trying to do with these provisions.

I have, however, a number of questions that I want the Minister to answer. Will English Heritage have the financial capability to fulfil the increase in responsibility that the clause imposes on it? We had a similar debate about ACAS earlier in the Committee’s deliberations. I understand that English Heritage’s budget was cut by 32% in the comprehensive spending review, which is more than the 24% cut that was imposed on the Department for Culture, Media and Sport.

At the time of the spending review Loyd Grossman, who is chair of the Heritage Alliance, stated that the announcement about English Heritage’s budget showed that

“government as a whole still doesn’t quite ‘get’ heritage…We fear that the immediate and longer term impact of a 32% cut for English Heritage and reduced funding from Local Authorities combined with the wider economic climate will lead to irreversible deterioration and loss of our heritage”.

Simon Thurley, chief executive of English Heritage, tweeted on 22 May:

“Our new listing regime will make space for us to do more strategic listing in the future.”

He tweeted again on the same day:

“Meanwhile we will be much more selective in spot listing, only going for things at risk, outstanding or identified as priority.”

Reading between the lines, it sounds as though the organisation will be unable to cope, given the reduced funding, and will have almost to firefight when it comes to heritage protection. Will the Minister comment on that, and will he reassure the Committee that English Heritage will be able to deal with the additional work set out in clause 50?

In a similar way, local authorities are seeing a cut their budgets. The amount varies by area, but in the north-east, council budgets are being cut by about 25% to 30%; in the south-east it might be substantially less. Local authorities of all political persuasions will need to make difficult decisions in the next couple of years as a direct result of the spending allocations provided by the Government. We are coming perilously close to a situation in which councils will have not simply to close a library here or shut a community centre there, but to question whether they can continue to provide entire services. In that context, given the demographic time bomb of an ageing population and the consequent difficulties in funding social care, which the House discussed yesterday, does the Minister accept that local authorities might have to consider quite large cuts to planning departments? How will they be able to cope, on a much-reduced budget, with the additional work that is required? What help will the Department for Business, Innovation and Skills give local authorities to assist them with the additional responsibilities imposed by clause 50?

Paragraph 5 of schedule 16 introduces a new offence of failing to obtain planning permission for demolition of an unlisted building in a conservation area. I fully support the provision, and I thank the Government for taking action on the matter. I have three related concerns and questions to which I would like the Minister to respond, however. First, I hope he agrees that for heritage protection reasons the penalty needs to be as harsh as possible, to deter potentially unscrupulous developers from knocking down a building before permission is given and claiming ignorance. Subsection (5) of the proposed new section that is set out in paragraph 5 details the punishment:

“A person guilty of an offence under this section is liable—

(a) on summary conviction, to imprisonment for a term not exceeding 12 months or a fine”

of up to £20,000

“or both;

(b) on conviction on indictment, to imprisonment for a term not exceeding 2 years or a fine or both.”

I want to probe the Minister on that. Has he considered whether those punishments are as harsh as they should be? I am quite hard-line when it comes to the protection of our heritage. A fine of £20,000 might seem appropriate, as might possible imprisonment, but is £20,000 enough when unscrupulous developers who knocked down a building might stand to make many millions of pounds? Secondly, I have just mentioned unscrupulous developers, but what about those who have demolished something in genuine ignorance? How does the Minister plan to communicate the changes to ensure that people acting in genuine good faith are not caught out by them?

Thirdly, how will the Minister ensure consistency of approach in compliance both within a conservation area and in different areas? I speak as a Member of Parliament for a constituency that contains several conservation areas, where inconsistent application of rules and procedures causes real bitterness and tension in the community. There is an area in my constituency known as the Headland. It is a beautiful area with mediaeval and Victorian elements, including beautiful houses. All that is around the fantastic church of St Hilda, which loses out only to Durham cathedral and York minster in its significance to Christianity in the north.

Chris Ruane (Labour, Vale of Clwyd)

What about Rhyl?

Iain Wright (Labour, Hartlepool)

I think that Rhyl is slightly further away from the north-east.

Over the past 10 years or so, there has been real bitterness from constituents following such things as the removal of historic sash windows and wooden doors, which have been replaced by modern-day uPVC counterparts. That has caused much ill feeling and has occurred largely because of inconsistent advice from local authorities. I worry that the issue is the same as my earlier point, which is that of adequate resources for local authorities and their planning departments. Do local planning authorities have sufficient resources to be able to provide a consistent approach and consistent advice?

Chi Onwurah (Labour, Newcastle upon Tyne Central)

While Newcastle may not have York minster or Durham cathedral—

Iain Wright (Labour, Hartlepool)

Or St Hilda’s.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

—Or St Hilda’s—within its boundaries, it does have many incredibly valuable and impressive heritage sites, including some from Roman times and two cathedrals. It also, as my hon. Friend has mentioned—

Julian Smith (Conservative, Skipton and Ripon)

On a point of order, Mr Bayley. If we go through all the heritage sites in the north of England, we would be at risk of never finishing the Committee. Is it in order for us to continue to list such sites?

Hugh Bayley (Labour, York Central)

Since the schedule particularly refers to the regulation of heritage, it is appropriate for hon. Members to bring forward examples, and I know that there is a cathedral in the hon. Gentleman’s constituency that we may have to hear about later.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

Thank you, Mr Bayley. I want to reassure the hon. Member for Skipton and Ripon that I had not even begun to enumerate all the heritage sites in Newcastle, not to mention those in the constituencies of my colleagues, such as my hon. Friend the Member for Rochdale.

To get to the point, Newcastle city council faces funding cuts of over 40% over the spending review period. Does my hon. Friend the Member for Hartlepool worry that the Government’s interpretation of localism means that councils such as Newcastle will be left to try to preserve these historic areas without the support that they need?

Iain Wright (Labour, Hartlepool)

I do fear that. I thought that the hon. Member for Skipton and Ripon would welcome the opportunity to mention the beautiful cathedral in his constituency, but he may not want to. That is up to him. [ Interruption. ] I expect a press release from him this afternoon in support of Ripon cathedral.

My hon. Friend the Member for Newcastle upon Tyne Central makes a valuable point. Given the enormous budgetary pressures that local authorities are facing over the next couple of years and given factors such as the demographic time bomb that I explained earlier and the importance of social care, it is difficult to think—particularly in my constituency, which is relatively deprived and has an ageing population—that local authorities such as Hartlepool borough council could spend on anything other than social care. In that context, given the importance of heritage protection, but with much reduced resources, is the Minister confident that local planning authorities’ budgets will be sufficiently protected to allow schedule 16 to be complied with?

I welcome the provisions in paragraphs 6 and 7, which will allow future new list entries to declare that structures and/or buildings attached to or within the curtilage of the principal listed building are not protected. That seems to be common sense, as a 1960s extension to a country house, for example, is often not something that should be protected for listed purposes. The provisions will therefore provide greater clarity and I welcome what the Government have done.

However, I share the two concerns raised by the Heritage Alliance in its submission to the Committee. First, the Heritage Alliance gave the example of a listed building with a garden wall that could be demolished without permission. It could be replaced, also without permission, with a wall that could be out of keeping with the setting of the listed building. Secondly, how will the provisions take into account the need for foresight? We cannot legislate with foresight, although perhaps we should.

The 1960s extension that I mentioned earlier could be considered worthy of protection in future with that benefit of foresight. We have seen 1960s buildings that even just a couple of years ago were considered to be blots on the landscape and are now considered to have architectural and significant historical merit and are being protected. How can we ensure that potentially important historic features are not lost? How will the Minister address that risk?

As I said, we welcome the direction of travel, but we have specific concerns about the implementation of this measure. I hope the Minister will respond positively to the points that I have raised.

Mark Prisk (Conservative, Hertford and Stortford)

I welcome the opportunity to speak to such an important part of the Bill. I should point out that I am a chartered surveyor, so I have had some engagement in this area. [ Interruption. ] Sadly, when I become a former Minister and move into the Budleigh Salterton home for retired Ministers with the hon. Gentleman—that is a sitcom we might not tune in to—no doubt we will reach the stage of looking at this and saying it is an important change.

The provisions seek to respond to what we saw in the Penfold review and the different forms of non-planning consents that exist alongside the perhaps better-known planning development regime. Our aim is to support growth and competitiveness by ensuring that the regimes operate in the most flexible and streamlined way, but without damaging our built heritage. There are four parts to the changes. The hon. Gentleman touched on some, but for the benefit of the Committee I will explain the distinctions. The first part removes the requirement for conservation area consent, separate from planning permission. The second improves the way in which list entries for listed buildings operate. The third enables certificates of immunity from listing to be applied for at any time. The fourth is about introducing a system of voluntary heritage partnership agreements to better proactively manage listed buildings.

I will turn to each part and respond to the points that the hon. Gentleman has raised. Paragraph 10 of schedule 16 amends section 74 of the Planning (Listed Buildings and Conservation Areas) Act 1990 to remove the system of conservation area consent as it applies to buildings in conservation areas in England. Such consent is currently required to demolish an unlisted building in a conservation area. The provisions remove that requirement. Planning permission will instead be required, which will be effected by secondary legislation to amend the General Permitted Development Order 1995.

There are some 9,800 conservation areas in England and around 3,000 consent applications each year. There is no need for a separate, bespoke consent regime for the applications. They can be dealt with perfectly effectively through the planning system. After all, most conservation area consent applications will already be submitted to the local planning authority alongside a redevelopment proposal, or will be followed by a planning application. By scrapping conservation area consent, and requiring planning permission instead, we can reduce the number of different non-planning consent regimes that developers and owners have to navigate, while maintaining the essential protection of our historic environment.

Paragraphs 3 to 5 of schedule 16 amend the Town and Country Planning Act 1990 so that the planning regime offers the same level of protection as the current system of conservation area consent. In particular. paragraph 5 inserts new section 196D into the Act to create an offence of

“failing to obtain planning permission for demolition of unlisted etc buildings in conservation areas in England.”

Where planning permission is granted for such demolition, it will also be an offence to fail to comply with any condition or limitation subject to which the permission was granted.

Buildings currently not subject to conservation area consent, because they are protected under other procedures, will not be subject to the new requirement to obtain planning permission. Classically, that will include scheduled monuments and ecclesiastical and fine buildings such as York minster, which have their own regime.

Our aim is to maintain current levels of protection while removing the unnecessary administrative duplication. In a sense, it is good to recognise the issue of resource. It is perfectly understandable to wish to raise that, but this measure, and the other three that I will touch on, are all about streamlining the system and helping local authorities use their resources in a more focused fashion. Reducing the burden of having to deal with parallel processes will be beneficial in that sense.

Paragraph 1 provides English Heritage with equivalent powers to those it currently has under the conservation area consent, including the power to bring a prosecution for an offence and to apply to the court for an injunction.

The hon. Gentleman asked about the fines, which, we believe, are appropriate as they stand, but we will always want to review them if we find that they are proving to be insufficient. At this stage, though, the current fine regime is one towards which we are sympathetic.

Paragraph 7 amends section 1 of the Planning (Listed Buildings and Conservation Areas) Act 1990, which deals with the listing of buildings of special architectural or historic interest. Currently, section 1 provides that a listed building includes

“any object or structure fixed to the building…or within the curtilage of the building which, although not fixed to the building, forms part of the land and has done so since before lst July 1948”.

That makes it difficult to exclude parts of a building that are not of special interest, which is the point that the hon. Gentleman raised. Owners or developers and local planning authorities are left to interpret the extent of a listed building’s special interest at the point where works are planned to be carried out. That can, and does, lead to unnecessary applications for listed building consent, or to applications not being made when they should have been. That is a good point about the question of uncertainty. This is an inefficient way to operate, and has led to confusion and occasionally disputes. English Heritage’s legal team reports that the extent of listing is the most common query that it deals with.

The provisions in paragraph 7 allow the list, for buildings in England, to provide that fixed and curtilage objects or structures are not to be treated as part of the listed building. That would allow the list to state definitively that a particular part or feature of a building is not of special architectural or historic interest. That will make it possible to say definitively that a poorly built 1960s extension on the back of a Georgian facade is not of special interest. Therefore, the works to the extension would not require listed building consent. That will specifically clarify matters. Clearly, if the works were to affect the Georgian façade, that would be a different matter. Putting in that specific definition makes matters clearer to people.

The provisions will initially apply only in relation to new listings, although English Heritage is also undertaking a prioritised programme to update the list entries of those categories of listed building that are subject to regular consent applications. We think that the changes will result in a 10% reduction in the number of listed building consent applications every year, with the resulting savings starting to grow as more and more existing list entries are enhanced. We are taking that carefully because we recognise that with some 500,000 entries on the list, it would lead to a significant number of errors and be hugely prohibitive in financial terms to say to English Heritage, “You must now put everything on”. There is a prioritised programme and that will help.

Let me touch on the issue of certificates of immunity, because that will help with the resource question. Paragraph 8 amends section 6 of the 1990 Act, which currently provides a system of certificates of immunity from listing. The way in which this works is that a certificate of immunity is a legal guarantee, in England, issued by the Secretary of State, which guarantees that a building will not be listed for five years from the date of issue. They are a useful tool where development is intended that would impact on a building that may be eligible for listing. They give certainty to owners and developers by removing the risk of a building being listed at a late stage during the preparation of planning proposals, thereby causing delay or even abandonment of projects. I am sure hon. Members can think of urban regeneration schemes under the current regime that suddenly find mid-stream they have to stop, which can be immensely damaging.

Currently, a person can apply for a certificate of immunity only where an application has been made for planning permission, or planning permission has been granted. Paragraph 8 of the schedule amends section 6 to remove that restriction so that a certificate of immunity can be applied for at any time. The same standards and decision-making process will apply. It is trying to ensure that there is a degree of flexibility, so that schemes that communities often seek are not caught out at the last minute.

Lastly, I turn to heritage partnership agreements, which will help the resource of both local government and English Heritage. Paragraph 9 of schedule 16 inserts new section 9A into the 1990 Act, which makes provision for heritage partnership agreements. They are voluntary agreements between owners and local planning authorities designed to help them manage listed buildings more effectively and reduce the need for individual consents for minor or repetitive works: routine maintenance would be a good example.

Under the new section, a heritage partnership agreement can be made by a relevant local planning authority with an owner of a listed building, or part of a listed building, in England. Any of the persons mentioned in new section 9A(2) may be an additional party to the agreement, including the relevant local planning authority, the Secretary of State, English Heritage and so on.

A heritage partnership agreement may contain provisions granting listed building consent for specified works, and setting out the terms on which that consent is given. It cannot be used to grant consent for demolition. Non-statutory heritage partnership agreements have been piloted by English Heritage for several years. They have demonstrated the benefits to the parties of clarity, mutual understanding and consistency of approach, as well as important savings from wasted effort and activity. But without statutory backing the full benefits of the agreements cannot be realised. The pilots have shown that enabling listed building consent to be granted through such agreements is crucial in delivering savings and encouraging take-up.

At the moment, even if the parties agree to an HPA, it is not necessarily the case that certain works are eligible to be applied for in terms of listed building consent. We need to clarify that and put it into law. Under our provisions, works agreed as part of a heritage partnership agreement will not need separate listed building consent, removing the requirement for repeated consent applications. We believe that will help people better manage the use of that building.

I should stress that this is about having agreements. They are optional; there will be no compulsion to require owners or local planning authorities to sign up. That is partly because heritage partnership agreements will not be appropriate in every circumstance. However, they will present owners and local planning authorities with an additional management option. Following on from the point that the hon. Member for Hartlepool made, we believe that that can deliver significant efficiency savings in the medium and long term.

To conclude, the provisions in schedule 16 will reduce the regulatory burdens but will not seek to diminish the protection of important heritage sites and buildings. They will make the heritage protection system work more efficiently, provide greater certainty to owners and developers, and reduce the number of unnecessary planning applications. I therefore commend the clause and schedule to the Committee.

Iain Wright (Labour, Hartlepool)

I am grateful to the Minister for his thorough response. He obviously understands this policy area, as he is a chartered surveyor. He kept that quiet from the Committee; he has not mentioned that a lot. I did not mention heritage partnership agreements in my opening remarks, but we agree with what the Government are doing. I mentioned the Heritage Protection Bill of 2009 and its similar provisions. I fully agree with what the Minister said about HPAs providing clarity, mutual understanding and consistency of approach.

I mentioned a specific concern about funding allocation and support from the Department to English Heritage and, with respect to the Minister, he skirted round the issue.

Iain Wright (Labour, Hartlepool)

It is a pleasure to serve under your chairmanship, Mr Brady. I welcome you and the rest of the Committee back to our deliberations.

Before we ended this morning’s sitting I was speaking about heritage partnership agreements, and about how I agreed with the Minister that HPAs can provide clarity, mutual understanding between the various parties, and a consistent approach, which is important across a whole range of regulation and business policy, but particularly with regard to heritage protection. I was focusing on the budget cuts of about 32% for English Heritage and, as I feel that the Minister skirted over the issue, saying that there would be priorities and economies of scale, I would like him to expand on that. Given the onerous task before English Heritage—and local planning authorities—will sufficient support and resource be available to the organisation? What, if any, financial assistance or support could his Department provide to enable English Heritage to fulfil its duties under the provisions?

Mark Prisk (Conservative, Hertford and Stortford)

I welcome you to the Chair, Mr Brady. We are confident that English Heritage will be able to deliver the reforms in the Bill. Importantly, in our discussions before lunch, we learnt that things such as the heritage partnership agreements will really help organisations such as English Heritage to focus and better use their resource. The national heritage protection plan sets out exactly how English Heritage, with help from partners in the sector, will prioritise, and will deliver heritage protection over the next four years, including refocusing designation activities to respond to the changes set out in the Bill.

I suspect that the hon. Gentleman is all too well aware that this is not a matter on which English Heritage reports to the Department for Business, Innovation and Skills. It reports to the Department for Culture, Media and Sport, and although it might be tempting to decide on its behalf potential spending commitments, I would be wiser to reserve my remarks. We are aware of the challenges, but are confident that English Heritage will be able to implement the reforms. On that basis, and without wanting to sprint too fast to the finish, I conclude my remarks.

Clause 51 - Commission for Equality and Human Rights

Graham Brady (Conservative, Altrincham and Sale West)

With this it will be convenient to discuss the following:

New Clause 14—Commission for Equality and Human Rights—Independence from Government—

‘Schedule [Commission for Equality and Human Rights—Independence from Government] has effect in order to improve the effectiveness of the Commission in exercising its functions under Part 1 of the Equality Act 2006.’.

New Schedule 2—Commission for Equality and Human Rights—Independence from Government—

‘1 Schedule 1 to the Equality Act 2006 is amended as follows.

2 Replace all reference to “Secretary of State” with “both Houses of Parliament”.’

Iain Wright (Labour, Hartlepool)

On the basis of what clause 51 plans to do with the Equality and Human Rights Commission, the Opposition think that the new clause and the new schedule are needed. Suffice it to say at this stage that the Government are, with a combination of legislative changes in the Bill and budgetary and staffing reductions elsewhere, emasculating the EHRC.

Julian Smith (Conservative, Skipton and Ripon)

Will the shadow Minister give us his perspective on the current finances and budgets of the organisation, and comment on any recent reports he has read about the mismanagement of the commission’s finances?

Iain Wright (Labour, Hartlepool)

I am on my first paragraph, so let me come on to that later. I have plenty of time and opportunity to do so.

I think that everyone was shocked when they saw this clause. An Enterprise and Regulatory Reform Bill, which is apparently charged with boosting this country’s competitiveness and supposedly enables businesses to be freed from burdensome and unnecessary regulation, should not contain such a clause. What a clause the purpose of which is to water down and weaken the body tasked with protecting and promoting equalities and human rights is doing in the Bill, is quite beyond me. I want to stress to the Minister—I think he agrees with me—that the promotion and protection of equality and human rights is not, and should not be seen as, regulation. The Opposition therefore no longer have confidence that the Government will be a strong supporter of the commission charged with tackling inequality and human rights, and on that basis we tabled the new clause. The issue would be better served by having the commission independent of Government and accountable to us in Parliament.

John Wadham, legal director of the EHRC, stated to us in evidence that the Bill was a missed opportunity to make the commission accountable to the House rather than to Government. He said that

“this is a missed opportunity by the Government to bring in some provisions that we would like to see. These are the harmonisation between our equality and our human rights remit; and perhaps most importantly, a process whereby we are accountable to you, Parliament, rather than to the Government. We are a non-departmental public body, which means that we have a sponsor Department, currently the Government Equalities Office, which is part of the Home Office. Although that is a traditional approach that Government take to such bodies where they have to have some kind of arm’s length independence, we believe that a better and proper independence, preferred by the United Nations when it set out the Paris principles for bodies like ourselves, is the case of the Parliamentary Ombudsman and Electoral Commission. It is easier to demonstrate our independence.––[Official Report, Enterprise and Regulatory Reform Public Bill Committee, 19 June 2012; c. 76, Q168.]

Mr Wadham referred to the Paris principles—

Lorely Burt (Liberal Democrat, Solihull)

Did the Labour party consider such a change when it was in government for 13 years?

Iain Wright (Labour, Hartlepool)

That is an important consideration, which we thought long and hard about. I will come on to that at length as I expand my argument, but we concluded that there was such cross-party support for the concept of a commission for equality and human rights that it could stay within government and not be tampered with—for want of a better term. Given what is going on in clause 51 and the budgetary concerns and cuts of up to about 60%, however, we now think that it needs to stand alone, which brings me back to the Paris principles.

Those principles are a set of core minimum recommendations adopted by the United Nations General Assembly relating to the status and functioning of national institutions for the protection and promotion of human rights. Paragraph 2 of article 33 of the convention on the rights of persons with disabilities requires countries to take the principles into account when designating or establishing

“mechanisms…to promote, protect and monitor implementation of the…Convention.”

According to the Paris principles, such mechanisms must: be independent of the Government, with such independence guaranteed by statutory law or constitutional provision; be pluralistic in role and membership; have as broad a mandate as possible, capable in the context of the convention of collectively promoting, protecting and monitoring the implementation of all aspects of the convention through various means, including the ability to make recommendations and proposals concerning existing and proposed laws and policies; have adequate powers of investigation, with the capacity to hear complaints and to transmit them to the competent authorities; be characterised by regular and effective functioning; be adequately funded and not subject to financial control, which might affect their independence; and be accessible to the general public and, in the context of the convention, in particular to persons with disabilities, including women and children with disabilities and their representative organisations.

Those principles are, frankly, under threat given what the Government are planning for the EHRC, in particular in terms of that broad mandate to promote, protect and monitor, the need for adequate powers of investigation and the adequacy of funding. Thus, at this stage, the commission would be best served if the first Paris principle was more explicit on independence from government. That is our argument for the new clause.

I spent the weekend looking at Hansard, on Second Reading in the House in November 2005.

Ian Murray (Labour, Edinburgh South)

I thought you were listening to the Stone Roses.

Iain Wright (Labour, Hartlepool)

I was probably listening to the Stone Roses while reading Hansard.

I am leading up to the point made by the hon. Member for Solihull. I was a Member at that time, and I was particularly struck by the contribution from the hon. Member for Basingstoke (Maria Miller), who is a leading figure in the Conservative party and is now the Under-Secretary of State for Work and Pensions. She said:

“In the debate in the House of Lords, the Lord Chancellor pointed out that one of the basic foundations of the Bill is ensuring that everyone can participate in this country's economy. We have to do all that we can to enhance the competitiveness of our country”—

I agree with her. She continued:

“Streamlining the Equal Opportunities Commission, the Commission for Racial Equality and the Disability Rights Commission into one commission for equality and human rights will, I hope, provide a framework for a simpler, more easily accessible and consistent approach. Indeed, many businesses have welcomed the Bill”.—[Official Report, 21 November 2005; Vol. 439, c. 1318.]

So why in a little over five years has there been such a change in the Conservative party’s position? Why are the Government doing what they are doing with the drastic reduction in funding and, via the clause, severely restricting the commission’s remit? Why have we had such a change when the official Conservative party position was not to divide the House on Second Reading in November 2005? I know I am asking the wrong Minister here, but are we seeing the return of the nasty party? I hope not and that hon. Members on both sides of the Committee will agree and vote against this clause. I could not possibly say that the hon. Member for Skipton and Ripon is an example of the nasty party, but I am happy to give way to him.

Julian Smith (Conservative, Skipton and Ripon)

What does the shadow Minister think about the fact that the National Audit Office under his Government refused to pass the accounts of the commission for three years running? Does he think that is an example of a well run organisation?

Iain Wright (Labour, Hartlepool)

I do not know whether I have pointed this out, Mr Brady, but I am an accountant by profession. It is almost as bad as being a chartered surveyor or even, heaven forbid, an employment lawyer. I can be called a lot of things. A politician is one of the worst insults in modern-day society and an accountant not much better, but at least I am not an employment lawyer.

Norman Lamb (Liberal Democrat, North Norfolk)

Have you talked to your boss about that?

Iain Wright (Labour, Hartlepool)

I will not be in my current position for very long if I keep talking like that. But I digress. The hon. Gentleman makes an important point. I am the first to state that having rigorous budgetary provisions and rigorous internal financial control mechanisms is vital for a well run organisation. But that does not mean that the remit of the organisation should be slashed so that it cannot promote equality and human rights. The two things are quite separate in this regard. I would join with the hon. Gentleman in asking the auditors to make sure that this is a well run organisation with a good and comprehensive system of internal financial control, allowing it to carry out its objectives but not to use that as an excuse to do what is happening under the clause.

Julian Smith (Conservative, Skipton and Ripon)

The hon. Gentleman said that he was reading Hansard at the weekend. He must have been reading and drinking at the same time because John Wadham’s evidence to this Committee was that this change was not an issue that he was very concerned about. Why is the hon. Gentleman creating this big hullabaloo about nothing?

Iain Wright (Labour, Hartlepool)

Is the hon. Gentleman in order to say that I was drinking while reading Hansard, Mr Brady? I have to seek your guidance before I answer him.

Graham Brady (Conservative, Altrincham and Sale West)

I am happy to give my guidance. I have not taken any advice myself but my interpretation would be that to accuse you of being drunk during a sitting of the Committee would be entirely out of order but what your weekend pursuits may be is another matter.

Iain Wright (Labour, Hartlepool)

Thank you for that clarification, Mr Brady. To be fair, as the Committee has seen, being drunk while in the Committee is something that I seem to have been doing on a regular basis, given my contributions. The hon. Gentleman makes a serious and important point. He is right that Mr Wadham said that the commission could live with this. What I will say in the next few moments relates to the consultation that took place. Stakeholders have been vehemently opposed to some of the Bill, and I will come on to that.

Let us summarise what is happening in clause 51. It makes significant amendments to part 1 of the Equality Act 2006, which, as hon. Members know, was the legislative vehicle that set up the Equality and Human Rights Commission. The clause repeals section 3, which sets out the general duty of the commission. It repeals section 10, which imposes a duty on the commission to promote good relations between members of different groups. It amends section 12, which requires the commission to monitor and report every three years in society to the general duty as set out in section 3. As I have already said, section 3 is also set to be repealed. In addition to the specific changes in the Bill, the budget of the EHRC will be reduced by approximately 60%, and its staff complement reduced from 371 to about 150 in the next 12 months.

Let me come on to some of the provisions contained in clause 51 one by one. On the repeal of section 3, the commission’s general duty, the Government have argued, in their consultation, “Building a fairer Britain: Reform of the Equality and Human Rights Commission”, that section 3

“has no specific legal purpose and does not help to clarify the precise functions EHRC is required to carry out”.

As far as I can see, the main purpose of that general duty was to provide clarity on how the courts or tribunals interpret the legislation or provide guidance to other bodies. The repeal of this section will have the opposite effect to that which the Government claim. It will fail to clarify and will, in all likelihood, have the opposite effect. It will probably result in more uncertainty and more litigation. The commission will become a body largely limited to enforcing anti-discrimination legislation. Coupled with the plans to review the public sector equality duty, the Government must recognise the risk for the commission. It will be reverting to a failed and discredited model of compensation for individual victims of past discrimination, rather than being more positive and addressing the structural causes of inequality.

Norman Lamb (Liberal Democrat, North Norfolk)

The hon. Gentleman suggests that that will cause great legal uncertainty. However, it was John Wadham, the general counsel for the Equality and Human Rights Commission, who said:

“This Bill reduces our powers and our remit, but not in a way that we are overly concerned about.”—––[Official Report, Enterprise and Regulatory Reform Public Bill Committee, 19 June 2012; c. 79, Q176.]

Surely that completely contradicts the case that the hon. Gentleman is making.

Iain Wright (Labour, Hartlepool)

But let me retort by saying that the Government’s own summary of consultation responses states:

“A minority of those who responded to this proposal, supported its repeal”.

Indeed, for those who responded yes or no on this specific issue, only 14% of respondents agreed to the repeal of section 3. In contrast, the Government summary also states:

“The majority of respondents were opposed to repeal and were concerned about losing the guiding principles and values set out in the general duty, which had been debated in Parliament during the passage of the Equality Act 2006.”

Norman Lamb rose—

Iain Wright (Labour, Hartlepool)

I am happy for the Minister to intervene; in doing so, will he respond to that point? If that is the case, and if there is such a marked wish among stakeholders and respondents to the Government consultation, why are the Government continuing to insist on a repeal of this nature?

Norman Lamb (Liberal Democrat, North Norfolk)

It is clear that the responses to individual questions were rather limited. There were large numbers of responses to the consultation and they included more than half of individual respondents calling for the body to be abolished. Does the hon. Gentleman suggest that we should follow the view of more than half of the individual responses? Following his logic, that is what we should be doing.

Iain Wright (Labour, Hartlepool)

Touché. That is a good point. May I move on? [ Laughter. ] That is not a bad victory for the Minister this afternoon, I have to say.

On a similar point, clause 51 also repeals section 10 of the 2006 Act, which deals with repealing the duty to promote good relations. Again, the Government state that they believe that that duty is no longer necessary:

“The EHRC’s most valuable work in this area, for example, its inquiry into disability harassment, or its ‘Map of Gaps’ which mapped services for women who have experienced violence, could be done as part of its core equality or human rights work, complemented in Scotland by the work of the Scottish Human Rights Commission…We believe that scrapping these unnecessary duties will help the EHRC to develop a more integrated, and coherent work programme overall—enhancing its capacity to discharge its equality and human rights duties effectively.”

In the commission’s response to the consultation, however, it argued strongly for the retention of the duty:

“We agree that the current formulation of the good relations duty, which owes much to an outdated conception of how to improve race relations, is no longer as useful as it was to our predecessors. However we consider that removing the Commission’s ability to use methods other than legal enforcement is a serious error, particularly in view of the government’s own desire to tackle identity based inequality with ‘soft law’ measures.”

Fiona O'Donnell (Labour, East Lothian)

I thank my hon. Friend, the former accountant, for giving way. Does he agree that, at a time of tension in many communities around issues of culture, race and faith, the Government are sending out the wrong message?

Iain Wright (Labour, Hartlepool)

I do. The proposal sends out the wrong message and it weakens what the commission can do and its status within society.

Ian Murray (Labour, Edinburgh South)

I am delighted that my hon. Friend has given way, because I, too, read Hansard—how exciting it is. [ Interruption. ] I have even read it sober, indeed, but I wish I had not. However, the part of Hansard that I think is important is the Second Reading debate, when the Secretary of State was challenged by my hon. Friend the Member for Stretford and Urmston (Kate Green) on whether any jobs will be created and on what the proposal was doing in an enterprise Bill for jobs and growth. The Secretary of State replied that it will probably not do anything for jobs and growth, but that “the detailed implications” can be pursued later. What would my hon. Friend the Member for Hartlepool say in response to that?

Iain Wright (Labour, Hartlepool)

I will say two things to my hon. Friend, and I am glad that he has been reading Hansard. First, my strong view is that this clause should not be included in an Enterprise and Regulatory Reform Bill, as it is beyond this ragbag Bill’s scope. Secondly, my hon. Friend was on the Front Bench on Second Reading, and he will remember that in response to interventions from the Opposition the Secretary of State called the clause a “tidying up” exercise. I do not agree with that at all, and I hope that the Minister will clarify the Government’s intention. The clause is not a tidying up exercise; it is a deliberate attempt to try to reduce the scope of what the Equality and Human Rights Commission actually does. I would be happy to hear whether the Minister should apologise on the behalf of the Secretary of State for that “tidying up” remark.

Ian Murray (Labour, Edinburgh South)

I would like to pursue this point a little, because my hon. Friend mentioned the questioning of the Secretary of State on Second Reading and the actual quote from my hon. Friend the Member for Stretford and Urmston (Kate Green) in Hansard reads:

“How will the provisions of clause 51 on repealing some of the provisions of the Equality Act 2010 in relation to the general duty and the good relations duty have any impact on business whatsoever?”

The Secretary of State replied:

“I was going to mention that measure at the end of my speech. We see it essentially as a bit of legislative tidying up; we are not going to argue that it has significant impacts on business. However, we can pursue the detailed implications.”—[Official Report, 11 June 2012; Vol. 546, c. 75.]

Does my hon. Friend the Member for Hartlepool think that a 60% cut in anyone’s budget is just a “legislative tidying up”?

Iain Wright (Labour, Hartlepool)

My hon. Friend makes an important point. Some of the provisions in the Bill are somewhat paradoxical and contradictory. My hon. Friend has, with a great deal of skill and precision, spent a huge amount of time challenging the Minister, a former employment lawyer, on employment legislation. There was cross-party support for the belief that it is wrong to reach the stage of a formal legal tribunal case and that some degree of consultation and conciliation before that event is wise. The clause, however, pushes the commission towards a court-led approach when fulfilling its duties as opposed to pre-court conciliation, and that seems at odds with what is being proposed elsewhere in the Bill.

Section 27 of the Equality Act 2010 enables the EHRC to provide conciliation services. The Government propose to repeal that, including closing the complaints service for disabled air travellers and asking the Civil Aviation Authority to provide the service instead. The Government argue that the service provided by the EHRC to date has not been cost-effective and duplicates services available elsewhere. The commission’s contract with its present conciliation provider came to an end on 31 March 2012 and has not been replaced.

The Government state that

“the new Equality Advisory and Support Service”,

which I understand will be commissioned by the Government Equalities Office from the private sector or civil society,

“will provide an opportunity to encourage greater take up of mediation and conciliation by victims of discrimination and by those against whom allegations of such discrimination have been made.”

They argue that

“leaving the”

Civil Aviation Authority

“to provide a complete service could help to further incentivize the industry to improve compliance, minimizing the costs to industry and delivering a better outcome for disabled air travellers.”

Again, citing the Government’s own consultation, only 28% of respondents agreed with the notion that the CAA should deal with disabled air passengers’ complaints. Does the Minister think that the transfer of disabled air passengers’ complaints to a body managed by the airlines injects a necessary level of independence and impartiality into the complaints procedure? The commission strongly opposed that proposal during the consultation, saying:

“The Commission considers that this proposal, which will involve legislative reform, would undermine the direction of ministerial policy. In any event, it is wholly unnecessary, given that should ministers wish to discourage this approach, they are able to reduce funding to the Commission for this purpose, as is proposed in relation to advice and guidance. The proposed removal of the Commission's mediation and conciliation powers could lead to an increase in lengthy and expensive litigation by forcing private and public sector organisations down the more costly compliance rather than conciliation route.”

I reiterate the point that I made in response to my hon. Friend the Member for Edinburgh South. The proposal is inconsistent with the Government’s trying, in part 2 of the Bill, to emphasise conciliation over expensive compliance and litigation. Does not that demonstrate that this is a ragbag Bill? Frankly, one arm of Government, or even one arm of the Department, does not know what the other arm is doing.

Ian Murray (Labour, Edinburgh South)

We Opposition Committee members have used the words “ragtag Bill” on occasions, but does my hon. Friend agree that “omnishambles” might be closer to the point?

Iain Wright (Labour, Hartlepool)

It is an omnishambolic ragbag. I could go on at length—[Interruption.] And I know that Committee members are keen for me to do so. However, it comes down to a single point. Clause 51 has no part to play in this or any other Bill. Given the previous cross-party support and what the Minister secretly thinks about this matter, I am surprised that it was included. It is a nasty clause and should not be in the Bill. I urge Committee members to vote against the clause standing part of the Bill, but if they do not, I hope that they will agree to the new clause that we tabled.

Norman Lamb (Liberal Democrat, North Norfolk)

I join the shadow Minister in saying that it is a pleasure to serve under your chairmanship, Mr Brady.

Before I get on to the proposed new clause, I pay tribute to the unsung heroes of Hansard. We talk a lot about the work of Hansard and it has been mentioned many times in contributions by Opposition Committee members this afternoon. Its reputation for accuracy is impressive. On Tuesday, it accurately recorded an important exchange between myself and the hon. Member for Vale of Clwyd. I was addressing an important competition issue and the hon. Gentleman is reported as intervening with “Atishoo!” I do not think that I have ever seen that in writing before. My response was,

“Bless you. That was quite a shock.”––[Official Report, Enterprise and Regulatory Reform Public Bill Committee, 10 July 2012; c. 501.]

That is recorded for posterity.

Iain Wright (Labour, Hartlepool)

On that point, given that it is now recorded twice in Hansard, and given that we are trying to promote efficiencies as much as possible, does the Minister think that there is duplication of effort here?

Norman Lamb (Liberal Democrat, North Norfolk)

I think that we would need a Monopolies and Mergers Commission to consider that.

Let me consider the clause. I have a high regard for the shadow Minister, but he indulged in mock outrage, which I guess I had anticipated. The contrast between his assertions this afternoon and what the general counsel for the commission told the Committee are telling.

Lorely Burt (Liberal Democrat, Solihull)

I listened very carefully to the evidence and to the debate on the clause, and it seems that we have a streamlined EHRC that is playing a much more strategic role. As a Liberal Democrat member of the coalition Government, I recognise the great importance of the EHRC, but will the Minister confirm for the record how important this coalition Government believe the role of the EHRC is?

Norman Lamb (Liberal Democrat, North Norfolk)

I am extremely grateful for my hon. Friend’s intervention. Having an effective and highly regarded commission is incredibly important. The case for promoting equality of opportunity, regardless of gender, race and disability, is very important for a successful, competitive economy. That is why it is absolutely appropriate for the clause to be in the Bill.

Let me quote from the evidence given to the Committee by the general counsel for the Equality and Human Rights Commission, and let us compare what he said with the shadow Minister’s claims—assertions—about the horror of what is proposed in this clause. The general counsel said:

“The proposals that change the remit of the Equality and Human Rights Commission in clause 51 will not make a significant difference to the work of the commission.”–[Official Report, Enterprise and Regulatory Reform Public Bill Committee, 19 June 2012; c. 76, Q168.]

Compare that with the shadow Minister’s claims that the provision is a dreadful attack, initiated by a nasty party seeking to undermine the commission’s work. On the basis of what the general counsel for the Commission said to this Committee, that is rubbish.

Julian Smith (Conservative, Skipton and Ripon)

Does the Minister agree that if the commission is better run, its accounts are firmly operated, and it has a tighter remit, there is more chance that it will help with the issues that its mandate covers?

Norman Lamb (Liberal Democrat, North Norfolk)

I completely agree. Vague motherhood and apple-pie duties do nothing for anyone. They flatter to deceive, and give people a view that the commission can achieve great things, which it cannot. Let us focus on the practical things that it is there to do. It might then be able to do them well and effectively, promoting equality of opportunity.

Ian Murray (Labour, Edinburgh South)

Surely the Minister is not telling the Committee, and agreeing with the Secretary of State, that a 60% cut in a budget is merely legislative tidying up that will have no effect whatever on the operation of the body.

Norman Lamb (Liberal Democrat, North Norfolk)

If one looks at the way in which the money is being spent, one recognises that there is enormous scope for achieving real efficiencies in the organisation. The Opposition are congenitally incapable of considering the concept of cutting public expenditure. I remember well the former Prime Minister who could not allow himself to use the word “cut”. We went through weeks of anguish waiting to see whether he was capable of saying the word. The Opposition are still in a parallel universe where it is not necessary to bring a £150 billion a year deficit under control. I disagree with the hon. Gentleman’s intervention.

Ian Murray (Labour, Edinburgh South)

There is a distinct contradiction in the Minister’s view. On one hand, the Government are saying that the Opposition are allergic to cuts, and on the other the Chancellor says in the House that our cuts were as bad as those he is proposing. There is a distinct contradiction on whether we have cuts.

Graham Brady (Conservative, Altrincham and Sale West)

Before the Minister responds, I remind him that we are discussing not the Budget, but the structural implications of the Bill.

Norman Lamb (Liberal Democrat, North Norfolk)

I am grateful to you, Mr Brady. I was addressing the Budget in response to the intervention, but let me get back to the important views of John Wadham, general counsel to the commission:

“We would want to keep some of the provisions that are being taken away, but they are not as significant as they might perhaps seem looking at the legislation.”––[Official Report, Enterprise and Regulatory Reform Public Bill Committee, 19 June 2012; c. 76, Q168.]

He also said:

“This Bill reduces our powers and our remit, but not in a way that we are overly concerned about.”

Will the Opposition get real on this? Will they recognise that we are talking about streamlining, which, as my hon. Friend the Member for Skipton and Ripon rightly said, will make the commission more effective in its important job:

“it is not a significant attack on our remit”—

contrary to the shadow Minister’s claim—

“…but we will carry on doing our job and doing it well, I hope.”––[Official Report, Enterprise and Regulatory Reform Public Bill Committee, 19 June 2012; c. 79, Q176-177.]

On the cuts,

“Certainly, we are using this opportunity to become leaner and more effective.”––[Official Report, Enterprise and Regulatory Reform Public Bill Committee, 19 June 2012; c. 74, Q162.]

That is a welcome recognition from the commission. If only that recognition were shared by the Labour party, we might start to get somewhere.

I am grateful, none the less, to Opposition Members for their suggested amendments—[Laughter.]—or so says the script. I will first address the clause, and then I will address the points raised by the amendments.

Equality is fundamental for a strong economic recovery. We have to deploy the abilities and capabilities of every member of our society. I had a discussion with a Conservative Minister who put that remarkably well: as well as the interests of individuals and ensuring that every individual is treated fairly in our society, by discriminating against some in our society, we massively underachieve economically in a competitive global economy. Ensuring that all of our citizens can contribute to economic growth is of fundamental importance. We have to make the best use of all the talent that we have. That is why a strong and effective equality and human rights body is a priority, which is what our reforms are intended to achieve.

We want the EHRC to become a valued and respect national institution. To do so, we believe the commission must focus on the areas where it can add value as an independent equality body and A-rated national human rights institution. Incidentally, the EHRC’s international A-rating is confirmation that it accords completely with the Paris principles that the shadow Minister referred to. The EHRC must be able to show that it uses taxpayers’ money wisely, which is a rather important responsibility, and I suspect, on reflection, the shadow Minister would recognise that. To be fair to him, he conceded, as a former accountant, that that is important, but it is important that his party acts in accordance with that principle.

Since the EHRC’s establishment in 2007, it has struggled to deliver across its remit and demonstrate value for taxpayers’ money. As my hon. Friend the Member for Skipton and Ripon referred to in his intervention on the shadow Minister, the EHRC’s first three sets of accounts failed to receive a clear audit opinion from the National Audit Office, attracting criticism from the Public Accounts Committee. In my view, this is depressing: the EHRC employed 140 interim members of staff at a cost of nearly £9 million in 2009-10, at a moment when one would have thought that our economy needed a bit of help from efficiencies in the public sector. That is almost half as much again as it cost to employ the remaining 440 permanent staff for that year and write off losses of £866,000 on a website that was never launched. The Labour party has talked a lot about the legacy of the previous Labour Government. Is the Labour party proud of that legacy?

David Mowat (Conservative, Warrington South)

The Minister quotes some compelling cost numbers. Will he concede, however, that as the accounts were not signed off for the past three years, those numbers must only be estimates?

Norman Lamb (Liberal Democrat, North Norfolk)

I take that point. Interestingly, in the last year the accounts were approved, a period under this coalition Government, the EHRC struggled to deliver against its policy remit. For instance, the commission attracted criticism from the Joint Committee on Human Rights. Not only has the EHRC struggled with its finances, but it has also been criticised by that Committee on its failure to integrate human rights into its work.

Iain Wright (Labour, Hartlepool)

If that is the case, how has the EHRC still got the international A-rating that the Minister lauded earlier?

Norman Lamb (Liberal Democrat, North Norfolk)

The EHRC was designed and structured by the Labour party in government to be a strong independent body. I am trying to say that the coalition Government want it to be very successful. That is not in any way to say that its work has not been worth while—it does very important work. We want it to be more effective, and to ensure that the legislative framework allows it to focus its mind on the really important challenges that it has to face.

We recognise that the failures in how the EHRC was set up, led and managed have contributed to its underperformance—there is no doubt about that—but we believe that some of its difficulties stem from a lack of precision in its legislative mandate, which is why the clause seeks to clarify its legislative remit. We consider that focusing the EHRC on its core duties will enhance its capacity to develop and deliver a coherent programme of work.

The repeals will not impact on the EHRC’s equality and human rights powers and duties under the Equality Act 2006. The EHRC will therefore retain its duty to promote understanding of the importance of human rights and the awareness of human rights, and to encourage good practice in relation to human rights. It will also retain its duties to promote understanding of the importance of equality of opportunity and diversity and awareness of individuals’ rights under equality legislation, and to enforce the Equality Act 2010 and work towards eliminating unlawful discrimination and harassment. The clause will, however, remove vague duties that are not enforceable by an individual pursuing a claim in a court or tribunal, and that, according to John Wadham’s evidence, are of little value in terms of how the commission is charged with undertaking its core responsibilities.

On new clause 14 and new schedule 2, I should say how much we value the independence of the Equality and Human Rights Commission, which is assured by the 2006 Act that created it, and by it having been made clear that the EHRC is already accountable to Parliament through the Home Secretary—a framework that was designed by the Labour party in government. That is the standard approach in the UK: independence in law, coupled with financial supervision by a Department. It is consistent with the reforms that, following John Dunford’s independent review, have been proposed for the Office of the Children’s Commissioner, another structure established by the previous Government, and the shadow Minister should accept that such a model is appropriate.

It is not therefore clear why a different approach is considered necessary for the Equality and Human Rights Commission. In particular, we do not agree that the new clause and new schedule would in any way improve the commission’s effectiveness in carrying out its equality and human rights functions. Very few public bodies are set up or funded directly by Parliament, and those that are, such as the parliamentary ombudsman, have a parliamentary or regulatory function that is not comparable to the role of the EHRC. Parliament grants funds to the Executive, and it is for the Executive to account to Parliament through Ministers for the use of those funds and for value for money, which is why the vast majority of public bodies are set up in a similar way to the EHRC.

The Equality and Human Rights Commission is held to account by Parliament in several ways. Its accounts are audited by the National Audit Office, which of course reports to the Public Accounts Committee. The EHRC’s annual report and accounts are laid before Parliament. Its activities are subject to scrutiny by the Home Affairs Committee and the Joint Committee on Human Rights. In the past, both Committees have sought evidence from the EHRC, and whether they choose to do so in future is a matter for them. The EHRC’s reports on progress in society are laid before Parliament by the Secretary of State in accordance with section 12 of the 2006 Act. The Home Office, as the sponsor Department, is committed to supporting the EHRC in managing a challenging programme of reform.

We have also taken steps to underline the independence of the Equality and Human Rights Commission. As the Committee may be aware, we are in the process of appointing a new chair of the commission, and under this Government, for the first time, that appointment will be subject to pre-appointment scrutiny by a parliamentary Select Committee. Additionally, the board of the EHRC and the Home Office have agreed a framework document that explicitly recognises that the commission must be free to exercise its statutory functions without interference from Ministers. We believe that the safeguards of the 2006 Act and the framework document are sufficient to ensure that the commission is able to fulfil its functions independently of Government. However, if the commission believes that the Government have acted unreasonably, or encroached on its independence, it has the ultimate safeguard of the courts, and may seek a judicial review of any such action.

We want the Equality and Human Rights Commission to become a valued and respected national institution. We have therefore worked hard to develop a reform package that we believe will, across the board, increase its transparency and accountability to Government, Parliament, and the public whom it serves. That is key to raising standards while ensuring its independence and safeguarding its A-rated status as a national human rights institution. I therefore ask the Committee to accept that the EHRC remains accountable to Parliament through the Home Secretary. John Wadham gave this Committee clear evidence about the very limited impact of the reforms on the way in which the commission can go about its important work under its core duties. I ask the shadow Minister to reflect on that, and to withdraw the new clause and new schedule. I commend the clause to the Committee.

Iain Wright (Labour, Hartlepool)

I am grateful to the Minister, but I am afraid that he has not convinced me. From his body language, I do not think he has convinced himself. However, I do agree with him that every public sector organisation—indeed, any organisation—and not just the commission should ensure that it is lean, effective and provides value for money, especially when its resources come from the taxpayer. I thoroughly agree with that; that is not the issue. The concern is whether a 60% cut in its budget will be too much to allow it to fulfil its duties. We fear that repealing certain sections and removing some of the EHRC’s powers under the 2006 Act is counter-productive, and will make it difficult for it to fulfil its role.

Norman Lamb (Liberal Democrat, North Norfolk)

May I ask the shadow Minister whether he accepts John Wadham’s evidence?

Iain Wright (Labour, Hartlepool)

Mr Wadham is an important person—

Norman Lamb (Liberal Democrat, North Norfolk)

Does the hon. Gentleman accept what he says?

Iain Wright (Labour, Hartlepool)

Let me answer the question. Mr Wadham has raised important points. He is an experienced and knowledgeable member of the commission, so we obviously have to take some of his concerns into account. Given what is going on under clause 51, and given the budgetary cuts elsewhere, we fear that the commission will not be able to fulfil its duties. In normal circumstances, the current situation, as set up by the previous Government, would provide sufficient accountability to Parliament and sufficient independence. Given what is going on, we are concerned about the future stability of the organisation. It needs greater independence from Government, and greater accountability to the House. That is why we have tabled the new clause.

Norman Lamb (Liberal Democrat, North Norfolk)

The shadow Minister acknowledged that the Opposition had to take seriously the concerns expressed by John Wadham, who specifically said that the reforms were

“not a significant attack on our remit.”––[Official Report, Enterprise and Regulatory Reform Public Bill Committee, 19 June 2012; c. 79, Q177.]

Does the shadow Minister agree?

Iain Wright (Labour, Hartlepool)

I looked closely at what Mr Wadham said to us in Committee, and at several other aspects of the consultation, and, on balance, we think that there is a threat to the commission, such that we tabled the new clause and new schedule. We still think that clause 51 has no part to play in the Bill, and that is why, with your indulgence, Mr Brady, I would like to test the Committee’s opinion. I appeal to the Minister, who, I think, shares some of our concerns, to accept that we need to strike the clause from the Bill.

Norman Lamb (Liberal Democrat, North Norfolk)

I reassure the hon. Gentleman that he should not read anything into my body language. As an ex-lawyer, I hate vague legal duties that achieve nothing. I call them motherhood-and-apple-pie duties—the sort that do nothing for anyone, and potentially flatter to deceive. I think that both he and I would sign up to the absolute importance of doing all we can to secure equality of opportunity; there should be no discrimination on grounds of gender, race, orientation, disability, age or anything else. People should be treated on the basis of their abilities. We agree with that. We want an effective organisation that spends its money properly and focuses on its core objectives.

Iain Wright (Labour, Hartlepool)

I cannot remember whether I am intervening on the Minister, or have taken an intervention from him. He is a formidable employment lawyer; when he becomes a former Minister, going back to the legal field will be a lucrative business for him. As an author, he will have to revise the book. He spoke about motherhood and apple-pie, but if that is what he thinks, did he raise his concerns during the passage of the 2006 Act? Why did he not table amendments to the effect that the clauses in question were irrelevant, would not help the commission with its duties, and needed to be tightened up?

Norman Lamb (Liberal Democrat, North Norfolk)

I absolutely supported the Act, which was important and which consolidated and brought together different strands that had grown organically over many years. It was right to pass it. I am simply saying that the duties that we want to remove achieve nothing. It is right to focus on core responsibilities and take the advice of the commission’s general counsel, who said in evidence to the Committee that there is no impact on its important work.

Iain Wright (Labour, Hartlepool)

I thank the Minister for that response, but I reiterate what I said before. I would like to test the opinion of the Committee, as we think it important that the clause be struck from the Bill.

Graham Brady (Conservative, Altrincham and Sale West)

It may be helpful to the Committee if I explain that, although we have debated new clause 14 and new schedule 2, any Division on those would come later in the Committee’s deliberations.

Clause 52 - Primary authorities

Iain Wright (Labour, Hartlepool)

I beg to move amendment 95, in clause 52, page 44, line 2, at end insert—

‘(5) The Secretary of State, in publishing guidance as set out in subsection (3) must take steps to obtain and to take into account the views of small, medium and large sized businesses, local authorities and business organisations prior to the issuing of such guidance.’.

I want to express my disappointment in the collapse of support for me. It is collapsing faster than the country’s support for the Lib Dems.

I very much agree with the concept of primary authority schemes. Indeed, they were established by the last Labour Government. It is fair to say that they have been considered a success; even Government Members might agree with that. I have mentioned today that there is a need for business to have certainty and consistency, and we strongly believe that primary authority allows businesses to receive consistent advice that can be applied with regard to local authorities. We therefore think that the extension of the schemes is to be welcomed and encouraged.

However, when I was reading clause 52 at the weekend, alongside Hansard, I was struck by a number of things. Specifically, proposed new subsection (3) of section 22 of the Regulatory Enforcement and Sanctions Act 2008, set out in subsection (5) of clause 52, states:

“The Secretary of State may from time to time publish guidance about matters likely to be taken into account for the purposes of subsection (1B)(b).”

Proposed new subsection (4) of section 22 states:

“The guidance may be published in such manner as the Secretary of State considers appropriate.”

The Minister was saying in the last set of amendments how he disliked woolly, legalistic language. He said it needs to be taut and tight, but would he agree—I know he will not respond—that that language is far too vague?

Norman Lamb (Liberal Democrat, North Norfolk)

No.

Iain Wright (Labour, Hartlepool)

I mentioned in debates on earlier amendments that businesses and other relevant stakeholders should be included in policy making to make Government actions relevant and positive wherever possible for their businesses, their workers and the areas in which they operate. Amendment 95 would tighten the language and ensure that businesses and relevant stakeholders were consulted prior to the issuing of the guidance mentioned in the Bill.

Anne Marie Morris (Conservative, Newton Abbot)

Will the hon. Gentleman give way?

Iain Wright (Labour, Hartlepool)

I certainly will. Please don’t hit me again.

Anne Marie Morris (Conservative, Newton Abbot)

Would I? I will raise again the issue that I raised in discussion on a previous amendment. Has the hon. Gentleman taken into account the cost of the proposal, and the challenge of doing that consultation properly? One of the challenges that I find—as the Committee knows, I support micro-businesses—is finding a wide enough range of business organisations that are able to put forward the view of the micros. If we start limiting and prescribing, without allowing the Minister the flexibility to do what is right, we will end up with something that does not work and is excessively burdensome.

Iain Wright (Labour, Hartlepool)

I really like the hon. Lady—I have to say that, because I am frightened of her as well. She can move her arm around better than I can move mine. I have to question whether her sling is genuine. She again misses the important point, however, which I reiterate: certainly for micro-businesses and small businesses, and to some extent medium-sized businesses, this is a question of proportionality. There is no point in having a rigid one-size-fits-all system that does not take into account the nature of the businesses that are affected.

Anne Marie Morris (Conservative, Newton Abbot)

That is exactly what the legislation proposes: something that is not rigid. The shadow Minister is proposing something that is rigid.

Iain Wright (Labour, Hartlepool)

No, I disagree. As I said in opening the debate on this amendment, the current language is far too vague and does not provide any certainty to business. The clause says that the Secretary of State may issue guidance from time to time, but businesses will say, “What on earth does that mean?” How does it help us try to provide some clarity in the policy-making framework that we have to deal with?

The Minister should be amenable and agree to the amendment, because it helps us to take a pro-business approach, it is proportionate in its scope, and it helps to tighten up the language in the Bill.

Mark Prisk (Conservative, Hertford and Stortford)

First, I welcome the Opposition’s support for the primary authority schemes. It is fair to say that the idea originated with them. I was once in the position of the hon. Gentleman, and was Opposition spokesman in Committee when we debated the Regulatory Enforcement and Sanctions Bill. They were not happy times; it is better now.

Let me turn to the specifics of the amendment. There is a certain sense of déjà vu about it; there was a similar amendment this morning. We had an amenable conversation, in which there was an intervention from my hon. Friend the Member for Newton Abbot. It ended in the shadow Minister accepting my assurance and withdrawing his amendment. We will see whether that sense of déjà vu will be fulfilled. Let me do my best.

Clause 52 will broaden the criteria for businesses that are eligible for the primary authority scheme. It means that the smallest businesses that operate in any one local authority area can now join others that share an approach to compliance. We will get into broader details when we come to clause stand part. A shared approach to compliance simply means that businesses consistently follow the same centrally issued guidance in order to fulfil their regulatory obligations. For example, franchises of a brand, or members of the same trade associations, may qualify. They will be able to enjoy the valuable assurance that primary authority partnerships now bring to larger businesses. It will ensure that small and large enjoy the same benefits.

We know that the new eligibility criteria as drafted are broad, but that is intentional. We are keen to ensure that as many small businesses as possible benefit from reduced regulatory burdens. That means that guidance for businesses and local authorities will be extremely important. We know that the devil will be in the detail, and that the views of interested parties will be vital in making the scheme work properly. That is why subsection (5) will allow the Secretary of State to publish guidance specifically on what a shared approach to compliance will mean in practice.

This is where the sun starts to peek out from the clouds for the hon. Member for Hartlepool. I can confirm that, as he requests—he should not get too excited—any guidance published as a result of the clause will be developed in consultation with stakeholders, including businesses, local authorities, trade associations and business groups.

My hon. Friend the Member for Newton Abbot was right that if we put all the additional details, which are too prescriptive, into primary legislation, the danger is that we constrain the ability to ensure that we apply the appropriate measures to the appropriate situation. The debate has been a useful opportunity to allow the Committee to hear the Government’s intentions and to put them on the record. However, I do not believe that there is a need to prescribe the detail in the Bill. Having given that commitment and assurance, I hope that the hon. Gentleman will withdraw the amendment.

Iain Wright (Labour, Hartlepool)

I am delighted and somewhat surprised by the approach taken by the Minister. Given what he put on the record, and as I agree with a lot of what he said, I happily beg to ask leave to withdraw the amendment.

Iain Wright (Labour, Hartlepool)

I beg to move amendment 96, in clause 52, page 44, line 10, at end insert—

‘(8) The Secretary of State, within 12 months of this part of the Act coming into operation, will prepare and publish in both Houses of Parliament a report detailing how the implementation of Section 52 of the Act has been affected by resources provided to local authorities’ Trading Standards and Citizens Advice Bureaux.’.

It is me again, I am afraid, Mr Brady.

The British Retail Consortium, in its written submission to us, stated:

“We welcome moves to strengthen the regional and national perspectives of Trading Standards, given that many scams are perpetuated by organised criminals for whom jurisdictions and boundaries are meaningless. We sincerely hope that both the National Trading Standards Board and Citizens Advice are adequately resourced and appropriately skilled to achieve these aims.”

Trading standards are often considered a Cinderella service, not thought about until something goes wrong, and then identified, quite rightly, as being vital to the social fabric of our country.

The Committee may remember that Graham Hebblethwaite, of West Yorkshire trading standards, told us in evidence:

“We understand that, so through the primary authority scheme, you can have much more effective regulation on a much wider basis, where with adequate trust, common sense and support from colleagues in other local authorities, an individual primary authority working well with its primary authority business can facilitate greatly reduced activity in other areas of the country. It might be a burden for the individual authority that has to manage that when setting up the relationship, but in effect, if you set up a good system with a good set of controls, and other authorities gradually recognise that and accept that the controls are in place, they can concentrate their resources on rogue traders”.––[Official Report, Enterprise and Regulatory Reform Public Bill Committee, 21 June 2012; c. 126-27, Q277.]

I mentioned in earlier deliberations the impact on heritage planning provisions that funding cuts and pressures for local authorities will have, and I think the same principle applies here. The amendment would ensure that trading standards have the resources and skills to be able to deal with the clause’s provisions.

One of the objectives of primary authority schemes is to strengthen consumer protection. Consumers should seek reassurance from a consistent approach to regulation. However, given the cuts to the funding of citizens advice bureaux throughout the country, and given the additional pressures that they face as a result of a deteriorating economic situation—there are more people going through their doors—as well as cuts to legal aid and other services, we are concerned that the clause will have an adverse impact on consumer protection and links to Citizens Advice. That is the basis for amendment 96.

As I have said, we support fully what the Government are trying to do via clause 52, but the amendment would ensure that relevant organisations, such as Citizens Advice and trading standards—which is, perhaps, more directly relevant—have sufficient resources to fulfil their obligations under the clause. That is why the amendment suggests that the Secretary of State should prepare and publish a report within 12 months to show how the implementation of this part of the Bill has been affected by cuts to resources in organisations such as trading standards and Citizens Advice. That would allow Parliament to gain an assessment of whether the jam is being spread too thinly. I hope that the Minister will be amenable to such an approach and I look forward to his comments.

Mark Prisk (Conservative, Hertford and Stortford)

Clause 52 extends the scheme, so that many more businesses can participate. The scheme has been in operation since 2009, when it was introduced by the previous Government. During that time, it has focused on enforcement and helped local authorities save money. We estimate that for every pound that the primary authority scheme costs, there is an approximate £3.60 benefit to the regulatory system, so it is an important way of streamlining and focusing activity on the things that matter. That is partly because it takes less time for a local authority inspector to complete their work with a business under a primary authority partnership arrangement. They can be better prepared and can target their efforts and attention on where the greatest risks lie. There are, therefore, opportunities for trading standards and so on to be able to do their job more effectively and efficiently.

Indeed, we heard from a number of witnesses who gave evidence to the Committee during our first week of sittings that primary authorities help local authorities and local trading standards to focus the scarce resources that they do have on where they are most needed. The hon. Gentleman rightly quoted Graham Hebblethwaite from West Yorkshire Joint Services, which operates a substantial number of primary authorities. He said that

“an individual primary authority working well with its primary authority business can facilitate greatly reduced activity in other areas of the country.”––[Official Report, Enterprise and Regulatory Reform Public Bill Committee, 21 June 2012; c. 126-27, Q277.]

In a sense, therefore, rather than being compromised by budgetary pressures, local authorities are actually assisted in meeting their budgetary obligations.

I do not underestimate that pressures exist for funding trading standards and other consumer services. We have discussed extensively the Bill’s consumer reforms, and I do not intend to test your patience by revisiting them at great length, Mr Brady. It is important, however, that the Committee understands why a report, as proposed by the amendment, would not provide meaningful analysis for the House. The most significant resource commitment associated with the scheme for local authorities is for the primary authority in establishing and maintaining a partnership. Primary authorities are permitted to recover their costs for that work, so new partnerships formed as a result of the extension can be self-funded and are unlikely to be affected by changes to trading standards budgets.

Local authority-funded Citizens Advice services are entirely separate from the primary authority scheme. I suspect that, were I to get into the whys and wherefores of the relationship between individual local authorities and their consumer affairs, you would rightly call me to order, Mr Brady, so all I will say is that the funding of consumer services will have no effect on the implementation of the clause.

I share Members interests in making sure that local authorities are not overwhelmed by demand for partnerships, which is why I reiterate that we have made it clear that we will involve the Local Government Association and individual authorities in designing the detail of the extended scheme and monitoring its implementation.

It is important to bear it in mind that the existing protection—namely that the Secretary of State has regard to the resources available to local authorities when assessing new partnerships—will continue to apply.

As we discussed this morning on statutory review clauses, the Government are committed to strengthening the review of all new regulatory arrangements. In practice, however, 12 months after the start would not provide a sufficient period to get a full view of the way in which the eligibility extension has worked for businesses and local authorities.

I say to the hon. Gentleman and the Committee that we recognise the importance of continuous monitoring and evaluation, and we are committed to ensuring that it happens. In line with Government policies, the current reforms will be formally reviewed in three to five years following implementation. That will be the right point at which we can get a serious, meaningful conclusion on how they are developing, see where wrinkles that we had not anticipated may have occurred, and discuss what we can do to improve matters. However, if serious issues were encountered that affected implementation, the review would be brought forward so that any adjustments could be made. We do not anticipate that that will happen, but I put those comments on the record today, so that members of the Committee can see that that is the Government’s intention.

To summarise, we do not believe that the report suggested in the amendment is necessary, because the successful implementation of the clause is distinct from funding to local authorities for trading standards, let alone Citizens Advice. Necessary safeguards are in place to ensure, as I mentioned earlier, that local authorities are able to manage the impact of the extension effectively. It has been a useful debate on an important related issue, but given my assurances, I hope that the hon. Gentleman will reconsider and be prepared, as he has in the past after securing important assurances, to withdraw the amendment.

Iain Wright (Labour, Hartlepool)

I am grateful for the Minister’s positive, constructive comments. I welcome the involvement of the LGA on the design of any extensions, and I was particularly pleased to hear that the Minister intends the Government to have a review within three to five years. If he could tighten that time scale up, perhaps moving closer to three years, we would be in a place to do business together, and I would be more than happy to withdraw the amendment. If that broad, ambiguous three-to-five-year period, which would be uncertain for businesses, could be tightened up to within three years, it would be very productive.

Mark Prisk (Conservative, Hertford and Stortford)

I said two things: we expect to do the review within three to five years, which is a sensible period, but my additional point was that if it is clear that something is wrong and is affecting implementation, the review would be brought forward. I hope that helps.

Iain Wright (Labour, Hartlepool)

What would be the point at which the review would be brought forward? If it had not been working, what criteria would the Government and Ministers use to decide to do that?

Mark Prisk (Conservative, Hertford and Stortford)

Clearly, we must focus seriously on the impact of implementation. Perhaps to ensure that it is clear and to confirm it for the record, I will send a note to the hon. Gentleman, and through you, Mr Brady, to the Committee, setting out and confirming how that would work.

Iain Wright (Labour, Hartlepool)

The Minister has been constructive and I welcome his comments. On that basis, and in order to make progress, I beg to ask leave to withdraw the amendment.

Iain Wright (Labour, Hartlepool)

I shall be brief. I have stated on several occasions—this is the fourth or fifth time—that we agree with the concept of the primary authority scheme, which we introduced during the previous Labour Government.

I have a number of brief questions for the Minister. What additional areas of policy does he have in mind to introduce when it comes to the primary authority scheme over the next few years? On a similar theme and with a constituency hat on, although this issue affects many hon. Members, metal theft is a major problem in my area and elsewhere in the country. It has been discussed several times in the House, and I understand that a private Member’s Bill will have a Second Reading tomorrow. On that basis, how does the Minister feel about including metal theft as part of the primary authority scheme? In my area, I have seen that the theft of metal can occur in Hartlepool, for example, but it may then be sold in another part of the country, so consistency of approach would be helpful. I raise that point on the back of evidence to the Committee from the Chartered Institute of Environmental Health, which said that such an approach would be very sensible and demonstrate joined-up government thinking at all levels. Will the Minister consider implementing that approach, as well as what timetable would be available for it? I look forward to hearing what he has to say.

Mark Prisk (Conservative, Hertford and Stortford)

Perhaps I can start with that. It is an important point that I asked officials about, and they kindly produced an additional note. In reality, the existing licensing arrangements under the Scrap Metal Dealers Act 1964 fall within the scope of the legislation. In addition to whatever may or may not be discussed tomorrow on the Floor of the House, the opportunity for scrap metal merchants who wish to work together to share compliance and form a primary authority is within the scope of current legislation. That is a good and important point to bear in mind.

I also wish to flag up a couple of other important issues concerning the operation of the clause. As we have heard, the measure will provide an opportunity that will allow the smallest businesses to participate, and I would like to provide some examples to the Committee so that people understand the range and opportunities involved. Currently, primary authority partnerships can be formed to cover matters that include, among others, health and safety, fair trading, food standards and product safety. In the first three years of the scheme, some 512 businesses have formed partnerships, covering about 50,000 business premises. One third of those businesses—37%—are small and medium-sized businesses, albeit, I suspect, more medium than small.

That shows that the scheme is accessible and popular, but there is a problem. When I was in opposition and sat in the hon. Gentleman’s seat, we considered the Regulatory Enforcement and Sanctions Act 2008. I felt that the previous Government failed to address the fact that the primary authority scheme focused principally on larger businesses, and the question in my mind concerns how to help the smallest, single-site businesses enjoy the same assured form of regulation.

We are trying to introduce new eligibility criteria that open the scheme up. Those are designed to be broad—we touched earlier on what a shared approach to compliance means—and perhaps I may provide the Committee with some examples. A small business that operates from a single site would be able to comply if it followed regulatory guidance from its trade association on how to manage a key risk. Let us take the specific example of an individual small business involved in making cheese. By following specific guidance on the appropriate way to manage temperatures in cheese production—a very important issue—and by working with others and through its trade association, it would be able to form a primary authority under the clause. That is an important shift. At the moment, small businesses in one location are not able to do that given the way that partnerships operate.

Another important example is that of franchise companies. Compliance policies are often included in the terms of a franchise agreement. At the moment, we have the strange situation in which a single-site franchisee needs to follow the same procedures as all other sites in that brand, although there will be instances of local authorities demanding that they fulfil their regulations on a different matter, thereby putting that franchisee at a disadvantage.

Removing that problem and allowing franchisees under a brand to form a primary authority partnership would open up the whole scheme. To give Members an idea, there are 36,000 franchise outlets in the UK. In addition, 30 trade associations regularly work with the Better Regulation Delivery Office, which represents something like 750,000 businesses.

Anne Marie Morris (Conservative, Newton Abbot)

I commend the Minister on a first-class proposal and an excellent development and step forward. As I understand it, there has been a lot of support for the measure among the trade bodies that he has consulted. What steps will he take to ensure that some of the smaller bodies, which might fall below his line of sight, find out about this measure? We want as many businesses to take advantage of it as possible.

Mark Prisk (Conservative, Hertford and Stortford)

I entirely agree, not only with my hon. Friend’s compliment but—perhaps more importantly—about needing to get the message out. As the Bill progresses, I wish to ensure that the message goes out to the smallest groups, and to individual businesses who may wish to form a trade association in order to participate. I am sure that the all-party group for micro businesses, among others, will wish to participate in that. It is a wonderful opportunity for many of us who have been asked by small businesses in our constituencies why Tesco is allowed assured compliance but they are not. This will answer that question.

Julian Smith (Conservative, Skipton and Ripon)

For the scheme to be effective, the overall architecture of where it is administered needs to work effectively. I understand that responsibility for the primary authority scheme was moved from the Local Better Regulation Office in April this year. Will the Minister clarify who within BIS is now running it, and how that fits in with the Government’s many other deregulatory structures, such as the Better Regulation Executive and other units?

Mark Prisk (Conservative, Hertford and Stortford)

We had a problem. The review of regulations was dealt with in the Department for Business, Innovation and Skills but an entirely separate organisation dealt with implementation. The two needed to be brought closer together. That is why we have brought the expertise from the old LBRO into the Department. Therefore, the issue of regulation, the way it is dealt with and its implementation are brought together. That is where the oversight for that will occur.

The point about primary authority partnerships is that the local authority in each case—for example, West Yorkshire Trading Standards Services—leads at a local level. That is where the relationship exists for the businesses. It was also interesting in the Committee evidence sessions to hear that witnesses on both sides of the equation were supportive. Councillor Canver of the Local Government Association said that

“enabling more businesses to be part of that scheme will raise standards for businesses more widely.”

Jane Bevis from the British Retail Consortium said that

“some of our small and specialist retailers are looking forward to the opportunity of trade associations also being able to play a role in this”––[Official Report, Enterprise and Regulatory Reform Public Bill Committee, 21 June 2012; c. 124, Q275, Q274.]

The chief executive of the Trading Standards Institute told us that this was “a natural thing to do”.

This is a good opportunity to try to ensure that the smallest businesses in the sectors we have discussed are able to benefit from a scheme that started under the previous Government and that can now be widened, so that whatever the size of business, it can enjoy the benefit of assured compliance.

Touching on the broader issue of the subjects, the way in which that works at the moment includes quite a wide variety of eligible activities that fall under the primary authority scheme. It includes, for example, fair trading, product safety, food standards, health and safety, petroleum licensing and explosives licensing. It includes metrology, and I have to confess that I am not entirely sure what that is. It also includes age-related sales among other things. There is some difference between the nations—England, Scotland, Wales and Northern Ireland—but nevertheless this is a broad opportunity. I hope hon. Members from all parties will recognise that this a good chance to ease the burden of compliance and ensure that small businesses can do what they want: that is, follow the rules as set out, but have the confidence of knowing that they will not find those rules are changed when implemented. That is a vital part and I strongly recommend the clause to the Committee.

Schedule 17 - Unnecessary regulation: miscellaneous

Iain Wright (Labour, Hartlepool)

I do not intend to ask my hon. Friends to vote against schedule 17. I am confident that, in the face of the slowest recovery out of a global financial crisis and a double-dip recession made in Downing street, an Enterprise and Regulatory Reform Bill that repeals the Wireless Telegraphy Act 1967 to ensure that retailers are no longer obliged to notify TV Licensing of sales and rental of TV sets, and that also repeals the Water Industry Act 1991, which required the inclusion of an in-area trading ban of a licensed water company, will mean that we will now see economic growth flourish. I really do not know why the country is concerned about this Government’s economic competence and compelling vision.

Julian Smith (Conservative, Skipton and Ripon)

It is a lot better than the work that the hon. Gentleman’s Government did on repealing legislation. Before he criticises us, will he clarify what he did to deregulate during his 13 years in office?

Graham Brady (Conservative, Altrincham and Sale West)

But only while talking about the Bill before us.

Iain Wright (Labour, Hartlepool)

I will always adhere thoroughly to your guidance, Mr Brady. I do not want you to rule me out of order.

There is a serious matter when it comes to schedule 17 —or rather, there is not. Part 3 of schedule 17 concerns insolvency, which the Minister mentioned this morning. The Bill changes provisions for early discharge from bankruptcy set out in the Enterprise Act 2002. R3, the body representing some 97% of insolvency practitioners, stated in its written submission that

“we view the Bill as a missed opportunity to bolster the UK business rescue culture and help to protect the UK economy from the actions of unfit company directors. Addressing these two issues would play a crucial part in delivering a key aim of the Bill—encouraging long term growth.”

We have tabled no amendments to this part of the Bill, although we reserve the right to consider doing so on Report. I am keen to work collectively and constructively with the Government and the Minister to ensure that our bankruptcy and insolvency regime is as conducive as possible to our economy’s long-term growth and competitiveness, and to encourage and incentivise the survival of businesses as much as possible. On that basis—with your permission, Mr Brady—it would be worth debating whether we should revise insolvency legislation to safeguard existing companies as well as making policies to create new ones.

I accept fully that the protection of creditors is vital. In years gone by, creditors in this country had the right to chop off the ears of a bankrupt. I am not suggesting that we table an amendment to that effect, although if the Government wish us to do so, I am more than happy to do so. I accept that in an economy in which access to finance is a major obstacle to growth, anything that could limit credit requires careful consideration. With your permission, Mr Brady, I suggest that, in the same way we considered Cadbury, Kraft and Manchester United as case studies for the takeover regime, we consider the Coryton oil refinery as a case study for what we need to do to ensure that important assets for our economy are kept in this country.

Coryton was owned by Petroplus, which went bankrupt early this year. The company owned five plants in western Europe. Coryton is the most efficient refinery plant in western Europe. I understand that it has a Nelson complexity rating of 12, whatever that means.

Ian Murray (Labour, Edinburgh South)

How much?

Iain Wright (Labour, Hartlepool)

Twelve, meaning that it could produce a high proportion of lighter fuels that fetch a higher margin in the markets. It was a highly profitable plant, although the manner in which the parent company structured its debt meant that it had £2 billion in bonds against it. Nevertheless, from an objective point of view, the plant seems to be a strong candidate for remaining a going concern. One would think that other plants in western Europe and elsewhere would be further down the line towards closure. However, the UK plant will be the only Petroplus plant to close, with the loss of 900 jobs in Essex.

Shell has bought the facility and is turning the site from a refinery into a simple—if it can be simple—storage depot for oil and diesel. Its advanced refining capability is now being stripped from the site and transferred to Shell’s plant in Rotterdam. Thurrock council has empirical evidence—I know that that phrase might shock and concern the Minister—in its impact assessment suggesting that the refinery is worth £100 million to the local economy.

I have described what is going on with Coryton oil refinery. With your permission, Mr Brady, I suggest that some of that could be due to insolvency legislation. Is there anything we can consider doing? In France, for example, when a company goes bust, French legislation dictates that the process should minimise the impact on employment. In the UK, as schedule 17 states, the top priority is the interests of creditors. I fully understand and accept that.

Norman Lamb rose—

Iain Wright (Labour, Hartlepool)

I will give way.

Graham Brady (Conservative, Altrincham and Sale West)

Before the Minister responds, my permission is growing a little tenuous. The only provisions relating to insolvency in schedule 17 are to do with the early discharge of bankruptcy. I fail to see the relevance of the hon. Gentleman’s remarks.

Norman Lamb (Liberal Democrat, North Norfolk)

I simply wanted to rise to support you as our esteemed Chairman, Mr Brady. I was going to ask what on earth this has to do with early discharge for individual bankruptcy.

Iain Wright (Labour, Hartlepool)

My point—I will finish in a sentence—is that the purpose behind part 3 of the schedule is to ensure that we can have an enterprise culture as much as possible in this country; I welcome what the Government are trying to do—

Norman Lamb (Liberal Democrat, North Norfolk)

That is a second sentence.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

Comma.

Iain Wright (Labour, Hartlepool)

Semi-colon. I am trying to probe the Minister in a very complimentary manner. We are discussing an enterprise Bill and we are concerned that the long-term competitive position of this country should be enhanced through the legislative framework with regard to early discharge from bankruptcy wherever possible. Therefore, is there anything else that we should be considering with regard to schedule 17 and elsewhere in insolvency legislation to ensure that our long-term competitiveness is enhanced and that assets that are important to this country are maintained?

David Mowat (Conservative, Warrington South)

I agree with you, Mr Brady, that the Coryton issue is not really relevant to the Bill, but as it has been raised—

Graham Brady (Conservative, Altrincham and Sale West)

No, Mr Mowat. Even though it has been raised, I would rather you did not.

David Mowat (Conservative, Warrington South)

You really would? I should just like to concentrate on a few things, Mr Brady. If it is out of order—

Graham Brady (Conservative, Altrincham and Sale West)

I think not on this occasion.

Iain Wright (Labour, Hartlepool)

Thank you, Mr Brady. I have concluded my remarks. This is an enterprise Bill and the objective of all hon. Members is to ensure that we can support the long-term competitiveness of our country and the assets that can help us grow the economy. Is the effect of bankruptcy on the Coryton oil refinery something that we should look at and amend the Bill in future?

Norman Lamb (Liberal Democrat, North Norfolk)

I suspected that the shadow Minister was trying your patience, Mr Brady, by returning yet again to Coryton. Suffice to say that I would be happy to have a discussion with him after the Committee has concluded its deliberations this afternoon. I would like to concentrate on what the schedule is about. He mocks individual repeals, but it is a completely different culture in this Government from what has gone before. For the first time, the Government are seeking to look at the stock of existing regulation and get rid of those that impose unnecessary or inappropriate burdens on business or which are simply no longer relevant. It was a mindset that never existed under the previous Government.

The hon. Gentleman talked earlier about one in, one out, which imposes a real discipline on Ministers. Every time any new regulation is considered we have to consider what we might get rid of to facilitate the introduction of the new measure. If that discipline had been present in the previous Government we might not have had six new regulations every day. The hon. Gentleman would be wise to take note of the approach we are taking and recognise that action has to be taken on all fronts.

Julian Smith (Conservative, Skipton and Ripon)

I congratulate the Minister on the schedule. Could he clarify how the red tape challenge and any deregulation coming off that will be implemented? We hope that there will be lots of regulations coming off the statute book as a result of that challenge.

Norman Lamb (Liberal Democrat, North Norfolk)

I am happy to accept my hon. Friend’s congratulations on the schedule. It is appreciated. This is just one small part of the whole agenda of repealing unnecessary, inappropriate or oppressive regulation. Where it is possible in future to remove regulation by secondary legislation, we will do that, and only where it is necessary to do it by primary legislation will we use that mechanism to do so. We will remain focused on removing regulation that is no longer appropriate or necessary, or that imposes an excessive burden on business. Incidentally, that approach also needs to be taken to consider the stock of regulation that has built up over the years at EU level, much of which now needs to be reconsidered.

The repeal in part 1 of schedule 17 will remove the outdated requirement on retailers to notify TV Licensing whenever they sell a TV, which imposes an unnecessary burden on business. Businesses will benefit because their staff will no longer have to spend time dealing with TV licensing inspectors and being trained to record details of TV sales, or spending time requesting information from customers, which may include managing any customer resistance to the request for personal data. Removing the burden will lead to a welcome reduction in costs for businesses. The British Retail Consortium has described the repeal as an enormous help. Its view is clearly not shared by the Labour party.

Ian Murray (Labour, Edinburgh South)

I appreciate that the Minister is trying to get rid of unnecessary regulations, but he has not said why the regulation is disappearing. Has he discussed with the licensing bodies, including the BBC, the impact that the measure may have on licence uptake in future?

Norman Lamb (Liberal Democrat, North Norfolk)

I have just explained why we are repealing this unnecessary regulation. It will have a small impact on the BBC, but it will benefit business and will therefore help with jobs by removing an unnecessary regulatory burden that business has to deal with.

Although I acknowledge that there may be some loss of licensing revenue to the BBC as a result of the repeal, the potential loss represents only a tiny proportion of its annual revenue from the licence fee. We do not envisage that the loss of that level of revenue will cause the BBC any great difficulty. Nevertheless, the Department for Culture, Media and Sport will monitor the impact of the repeal on the BBC’s revenue. Moreover, TV Licensing has a number of other tools for reducing evasion and non-payment that it will use to try to make up for any losses. The Government are talking to the BBC about what other non-regulatory options for reducing TV licence fee evasion may be available to it. In answer to the hon. Member for Edinburgh South, discussions with the BBC are under way to seek to minimise the potential impact on revenue.

Part 2 of schedule 17 removes section 2(3)(d)(iii) of the Water Industry Act 1991, a provision known as the in-area trading ban, with which the shadow Minister will be familiar. That provision will remove a barrier to competition in the water sector by enabling associate companies of water undertakers to compete for contracts in the area of their parent water company, enabling them to compete on an equal footing with other water companies that have no restrictions on where they can supply water. In particular, it will enable them to compete for national multi-site water supply contracts.

The Government are committed to promoting greater competition in the water sector to encourage innovation, increase consumer protection and build resilience to climate change. Removing barriers to competition, including the in-area trading ban, is a key element of the reforms to the water sector outlined in the water White Paper.

Ian Murray (Labour, Edinburgh South)

I am interested in the Minister’s speech about the schedule. Does he agree that the three clauses that he is promoting will remove regulations brought in under a Conservative Government?

Norman Lamb (Liberal Democrat, North Norfolk)

I have no idea. It is largely irrelevant. [Interruption.] This Government want to consider regulation wherever it came from and whenever it was introduced and see whether it is appropriate now, in this modern age, to remove it. The hon. Gentleman’s party would have done well to have adopted that discipline during its time in government, rather than adding six new regulations every day during its period in office.

The Government published the draft Water Bill on 10 July 2012. Pre-legislative scrutiny will give Members the opportunity to analyse our proposals in detail, and we look forward to hearing views on our liberalising proposals. The provision will be implemented through an amendment of water company licence conditions by Ofwat, the water sector regulator.

Part 3 of schedule 17 repeals section 279(2) of the Insolvency Act 1986. I will confine my remarks to individual bankruptcy, in marked contrast to the shadow Minister’s. Section 279(2) allows bankruptcy to end in less than 12 months when certain conditions are met, which is commonly known as early discharge. Currently, most bankrupts gain their discharge from bankruptcy after 12 months, and their unpaid debts are written off at that point. Early discharge was introduced to allow an even earlier end to bankruptcy for those whose affairs do not require any further investigation. Early discharge was intended to promote rehabilitation and reduce the stigma attached to bankruptcy.

When we reviewed the effectiveness of the provision, however, we found that it had not had the positive impact that we expected. Our review found that only 15% of bankrupts thought that the discharge period of less than a year was appropriate. The provision had, however, introduced considerable financial and administrative burdens into the bankruptcy case administration process, which is why we seek to repeal that measure. The average time at which early discharge is effective is eight months, so all that is achieved from quite a costly and bureaucratic process is four months, which is not a particularly significant gain.

Early discharge notices cost businesses time and money. We have found that, by repealing early discharge, we will save businesses £0.6 million a year. I know that is irrelevant to the Labour party, but it is worth achieving for businesses. Having a single automatic discharge period will also provide transparency and clarity in the bankruptcy regime. The measure is supported by stakeholders, including bankrupts and creditors. The Institute of Credit Management states:

“There are no benefits of early release…and the cost is ridiculous.”

Christians Against Poverty says that

“we can see no tangible benefit…that can justify the cost…to the Insolvency Service and creditors.”

I commend the measure to the Committee.

Clause 55 - Exploitation of design derived from artistic work

Iain Wright (Labour, Hartlepool)

Clause 55 repeals section 52 of the Copyright, Designs and Patents Act 1988 to remove the 25-year limitation for artistic works created by an industrial process. The repeal will make such designs consistent with the approach across most UK copyright law whereby artistic works have copyright protection for the lifetime of the creator plus 70 years. The approach seems sensible and provides a degree of consistency and therefore simplicity. The measure, which we support, will help industries such as the British furniture and jewellery sectors.

Julian Smith (Conservative, Skipton and Ripon)

Will the hon. Gentleman congratulate Sir Terence Conran, who has articulated the problems experienced by the UK furniture manufacturing and design industry, and accept that the clause will make a massive difference to that industry, which is worth £2 billion to £3 billion to the UK economy?

Iain Wright (Labour, Hartlepool)

I am happy to do that, I think. There has been a display outside the Committee Room all week by the UK furniture manufacturing industry, which is an important part of what the country can do. Anything that can boost manufacturing, particularly furniture manufacturing, should be welcomed.

The Minister will have seen the submission from the Alliance Against IP Theft, which raises reasonable points about future legislative commitments. The alliance stated that it would be helpful to seek clarification of the application of section 51 of the 1988 Act as it applies to designs. It also made a reasonable point:

“Section 51 was intended to address functional articles such as exhaust pipes, not works which derive their value from their creative nature.”

Does the Minister have any plans to tackle that point? We want clause 55 to work, but the Alliance Against IP Theft stated in its submission:

“Without such a provision, the repeal of Section 52 will have limited benefits for classic designs.”

Has the Minister considered that submission? What is his response to its concerns?

Norman Lamb (Liberal Democrat, North Norfolk)

I welcome the shadow Minister’s support for the provision. From a legal perspective, clause 55 repeals the exceptions contained in section 52 of the Copyright, Designs and Patents Act 1988 and the Copyright (Industrial Process and Excluded Articles) (No. 2) Order 1989, with which hon. Members will be familiar, and removes references to section 52 elsewhere in the 1998 Act. In plainer language, if it is necessary for hon. Members, the existing law—section 52—removes copyright protection from mass-produced artistic works 25 years after the works were first marketed. If I market a chair that I designed and that I now manufacture, I can have copyright protection for 25 years, but thereafter any of my competitors may market their copies of my chair design and I can do nothing to stop them from doing so. Repealing section 52 would mean that all categories of artistic work will enjoy the full term of copyright duration—the life of the creator plus 70 years, rather than the 25 years to which copyright enforcement is currently limited. That will help designers and manufacturers of classic designs, who have been campaigning for the law to be changed and who want to encourage investment in the UK designers of the future. As we have already heard, the changed has been welcomed by designers such as Sir Terence Conran and Tom Dixon.

Spending on UK design output amounts to some £33.5 billion a year, and there are already around 350,000 people in core design occupations in the UK. We want to promote innovation among designers and to encourage investments in new designs while deterring the copying of original creative works. Furthermore, the UK is one of only three EU member states—the others being Estonia and Romania—that limit the term of protection for mass-produced copyright works. Designers argue that that undermines the integrity of our design industry and that it may make British companies less willing to support long-term investment in design than their European competitors. We therefore want to align our position with the rest of Europe.

We recognise that the repeal of section 52 may have implications for those who manufacture, distribute or sell replicas, such as, for example, replicas of classic home ware, and it is important that we take their concerns into account. However, it is important to bear in mind that not all replicas or furniture inspired by classic designs infringe copyright. There would be an infringement only if the copy is of a substantial part of an original copyright work. As in other areas of copyright law, it will obviously be for the courts to determine the exact scope of the law. In the light of emerging case law from the European Court of Justice, the time is right to make the change. We know that those in affected sectors have been aware that the law may need to be updated and that they have been following developments closely.

We want to minimise adverse impacts on sellers of replicas. Although we recognise the absolute importance of promoting the design industry, we must take account of others who may be affected and minimise such impacts. We will make transitional provisions to allow sellers affected by the change sufficient time to clear their existing stock and to assess which, if any, of their replicas might infringe copyright. My officials have already had constructive meetings with replica furniture makers. They will therefore be allowed enough time to seek from any relevant copyright owners the necessary permission to continue importing and selling replicas, or to modify their supply contracts and products.

David Mowat (Conservative, Warrington South)

Will the Minister clarify whether the extension of the copyright applies to imitations outside the UK, for example in China, or only to people making imitations in the UK?

Norman Lamb (Liberal Democrat, North Norfolk)

I await inspiration from my left. I will continue, but I will ensure that I either respond to my hon. Friend about his concern or write to him and other Committee members.

Finally, I make it clear that the clause is not about giving some form of blanket copyright to furniture designs. That has been suggested by some commentators, who have perhaps misunderstood what we are trying to achieve. In fact, only those items of furniture that are works of artistic craftsmanship will be eligible for copyright protection, as is currently the case. In any event, various categories of work, such as sculptures, greetings cards, book jackets and stamps are already excluded from the scope of section 52 of the 1988 Act, and therefore already enjoy the full term of protection. I therefore urge the Committee to support the clause.

Clause 56 - Power to change exceptions: copyright and rights in performances

Iain Wright (Labour, Hartlepool)

I beg to move amendment 97, in clause 56, page 46, leave out lines 5 and 6 and insert

‘provide that any act which may be done under this Chapter notwithstanding the subsistence of copyright is pursuant to such regulations no longer permitted without regard to the subsistence of copyright.’.

Graham Brady (Conservative, Altrincham and Sale West)

With this it will be convenient to discuss the following:

Amendment 98, in clause 56, page 46, line 6, at end insert—

‘(1A) The power to make regulations under this section is exercisable only in making provision for the purposes mentioned in section 2(2)(a) and (b) of the European Communities Act 1972.’.

New clause 15—Sharing and viewing on the internet—

‘(1) The Copyright, Designs and Patents Act 1988 is amended as follows.

(2) In Part 1 (copyright) after section 30 (in the general provisions) insert the following new section—

“30A Sharing and viewing on the internet

Where work is made available to the public at a particular web address with the permission of the owner of the copyright in that work, copyright shall not be infringed by—

(a) any circulation of that web address, or of its title, or of another web address that redirects to that web address;

(b) the downloading of any data required to display that work at that address, and any subsequent processing of that data, including processing for display, provided that it does not result in any publication elsewhere of the work or an adaptation of the work.”.’.

New clause 16—Material available to the public under freedom of information—

‘(1) The Copyright, Designs and Patents Act 1988 is amended as follows.

(2) In Part 1 (copyright) after section 47 (in the provisions relating to public administration) insert the following new section—

“47A Material available to the public under freedom of information

(1) Where material has been communicated to the public, pursuant to a freedom of information provision, any copyright in the material as a literary work is not infringed by the copying of so much of the material as contains factual information of any description for a purpose which does not involve the issuing of copies to the public.

(2) Where material has been communicated to the public, pursuant to a freedom of information provision, copyright is not infringed by the copying or communicating to the public of the material, for the purpose of enabling the material to be inspected at a more convenient time or place or otherwise facilitating the exercise of the right conferred by section 1 of that Act.

(3) Where material which has been communicated to the public, pursuant to a freedom of information provision, contains information about matters of general scientific, technical, commercial or economic interest, copyright is not infringed by the copying or issuing to the public of copies of the material, for the purpose of disseminating that information.

(4) The Secretary of State may by order provide that subsection (1), (2) or (3) shall, in such cases as may be specified in the order, apply only to copies marked in such manner as may be so specified.

(5) In this section, “freedom of information provision” means—

(a) section 1 of the Freedom of Information Act 2000;

(b) section 1 of the Freedom of Information (Scotland) Act 2000; and

(c) regulation 5 of the Environmental Information Regulations 2004.

(6) The Secretary of State may by order add further provisions to subsection (5) above.

(7) An Order under this section shall be made by Statutory Instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.”.’.

Iain Wright (Labour, Hartlepool)

The clause is important. I seek your guidance, Mr Brady, about whether we will have a clause stand part debate. My remarks will range widely around the issues involved, just as a means of explaining the rationale of the amendments, and I hope that, with your permission, I will be able to do that.

Graham Brady (Conservative, Altrincham and Sale West)

My guidance is that whether we have a stand part debate depends on how widely the debate on the amendments has ranged.

Iain Wright (Labour, Hartlepool)

Thank you, Mr Brady. That is very helpful.

As I and my hon. Friends have often said, the Bill’s purpose is to try to improve the competitiveness of this country’s economy and, in so doing, to nurture the growth sectors of the global economy in which Britain has a competitive advantage now and might have in future. The sectors of the global economy in which we are strong are automotives and pharmaceuticals, and we are particularly strong—I know that the Minister of State has been to the Farnborough air show this week, as have I—in aerospace, defence and security.

I also think that we are strong in the creative sector, in which we play a leading role. Thinking about it, the creative sector makes an immense contribution to the British economy. We are the world leader in the music industry. It is fitting that we are talking about this on 12 July, because it is 50 years to the day since the Rolling Stones played their first gig at the Marquee on 12 July 1962—I think the Minister of State was there. But to return to the present day, our small island has had a remarkable impact on popular music throughout the world. We had almost 13% of global music sales in 2011. One in eight albums sold around the world is British. The UK has had the best-selling album artist anywhere in the world in four of the past five years.

Norman Lamb (Liberal Democrat, North Norfolk)

Not the Stone Roses, please.

Iain Wright (Labour, Hartlepool)

That’s next year.

The UK’s best-selling album artists were Amy Winehouse in 2007; Coldplay in 2008; Adele in 2011; and—I have left the Minister’s favourite till last—Susan Boyle in 2009. Those are tremendous achievements for the British economy and for the creative sectors.

I have not mentioned this before, but I am fond—too fond—of the Stone Roses. I do not think I have mentioned that I went to see them play at Heaton Park. Their three concerts in Manchester, attended by 225,000 people, boosted the Greater Manchester economy by some £23 million. Again, that is a tremendous achievement. It shows the links between great British iconic bands and the positive impact that they can have on the economy.

The publishing sector is a particular success story.

The rest of the debate is in Hansard.