Regulatory Reform Bill [Lords]

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Mr. Brian Cotter (Weston-super-Mare): I rise to support the hon. Member for South Cambridgeshire. As hon. Members have said, we are discussing the possibility of a situation being based on a Minister's opinion. However, Ministers will have to substantiate such opinions in the documents placed before Parliament.

The amendments are key to the Bill because we are concerned to have objective, rather than subjective, tests. Reference has been made to my colleague in the other place, Lord Goodhart. He pointed out that a Minister's opinion would not be the definitive factor in the making of the order. A Minister will have to convince the Deregulation Committee that his opinion is correct. The Committee will be able to take issue with the Minister's opinion if it considers it an incorrect assessment of the situation. The Minister must then either amend the draft order accordingly, or risk the concept being rejected in the Committee's report. As Lord Goodhart said, the Minister's opinion is not the ultimate factor in determining whether an order should be accepted, and that should be reflected in the Bill.

What protection does the clause afford in terms of judicial review? A court of law could only intervene if a Minister's opinion were found to be irrational. That would be a hard concept to prove or disprove. A further fear was put forward. If the Government accepted the Wakeham report in its current form, the ability of the other place to block an order would be removed. A future Executive with a working majority in the Commons would not then be subject to any effective control.

The hon. Member for South Cambridgeshire has raised an important point. A Minister's opinion will not carry something through—he will have to convince the Committee that it is valid and correct. The Minister, therefore, is going to have to convince us that there is serious reason not to accept the amendments.

Mr. Stringer: The hon. Member for South Cambridgeshire had me flapping during his speech when he said that the Deregulation and Contracting Out Act, which refers to necessary protection, does not take into account the subjective opinion of the Minister of the Crown. In fact, section 1(1) of the Act begins:

    ``If, with respect to any provision made by an enactment, a Minister of the Crown is of the opinion—''.

I therefore hope that he will accept that, at least in that part of the Bill that is taken from the 1994 Act, we have changed nothing. What has been added to the Bill is the extra protection that the Minister must satisfy himself according to subsections 2(a) and (b). The hon. Gentleman read them out, so I shall not do so.

The hon. Gentleman said that there had not previously been a subjective test, and now there is one. I hope that I have shown that that is not right. He accepted that the new protections were sensible and followed the same principle of the Minister coming to a view, then going through the super-affirmative process. The process as it is applied under the 1994 Act was supported by the Conservative party from the beginning. It was not so supported by the Labour party, but it has since been convinced that the process has not been a problem. We have put in extra safeguards as we have widened the powers that can be used. Essentially, the same arguments apply to the extra safeguards as applied to necessary protection.

If a Minister intended to act in an unreasonable, dictatorial way, the process would be a strange one for him to go through. He has to consult the appropriate representative bodies and people affected by the measure, and that consultation—with certain exceptions that we will come to—has to be placed before the deregulation Committees. If the Minister wanted to remove protection and was being unreasonable in his judgment about necessary protection, or was attempting to remove rights or freedoms that people could reasonably expect to continue, that would be transparently clear to the Committees of both Houses, because the people affected would say, ``We believe our freedoms are being removed; the balance is not right.'' Moreover, the Committees can take evidence from those people. Given the political composition of both Committees, it is most unlikely, in the foreseeable future, that they would say, ``Fine, go ahead with the process.'' They would say, as has happened on several occasions, that the Minister was being unreasonable and that he or she should reconsider the matter.

The final point concerned why the Bill should contain a subjective test as opposed to an objective test. When one takes into account all the nuances and the difficult balances as the regulatory regimes are moved around, it is better for Parliament to decide the issue through a thorough and vigorous consultation involving both Houses. If there were no subjective test, but we relied only on an objective test, we would be passing the decision to the courts. My noble and learned Friend Lord Falconer of Thoroton said:

    ``We do not think that the right course is to allow the courts, after Parliament has scrutinised the legislation with the relevant amount of information and in the necessary degree of detail, to try to unhinge that process.''—[Official Report, House of Lords, 21 December 2000; Vol. 620, c. 854.]

The super-affirmative process is an extremely thorough and rigorous process of scrutiny of the deregulation orders, which will become regulatory reform orders. The Minister has to provide tests and protections. He must provide extra information, but there is nothing essentially different in this Bill from the 1994 Act. All that we have done is add extra protection against a wider power in clause 1. I hope that the hon. Member for South Cambridgeshire will recognise that and withdraw his amendment.

Mr. Lansley: I am grateful to the Minister as I clearly misdirected myself in my construction of the necessary protection provisions of the Deregulation and Contracting Out Act. It is clear that the fair balance and desirability test must be constructed initially by the parliamentary process. If, as the Minister says, that is necessary to defend the parliamentary process from being converted into a court-led interpretation of fair balance and desirability, I am prepared to accept his argument.

I am still somewhat confused about reasonable expectations, however. It may be because of a lack of awareness on my part, but if the test is of a reasonable expectation and a Minister has to be of the opinion that no reasonable expectations will be frustrated by the order, do we not still run the risk of a court overturning that and saying that there are reasonable expectations? The reasonableness is in the test itself.

Does the fact that a Minister has to have an opinion on the matter mean that reasonable expectations would not be sustained by a court? Would a Minister have to have an unreasonable expectation, perhaps saying that reasonable expectations were not being frustrated when they clearly were, in order for that to be challenged in the court? If reasonable expectations are the test, is not the court exactly the place where such a test should be applied, if an order might be reasonably construed to have frustrated those reasonable expectations?

I am still not wholly persuaded by the Minister's arguments on amendment No.8. Perhaps he will take a moment to offer some further comfort. If he signifies that he will think about the matter and perhaps write to members of the Committee, we might reasonably move on.

Mr. Stringer: I am always happy to save time and I thank the hon. Gentleman for saving me going through even more complicated and technical issues. I shall write to him.

Mr. Lansley: I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Mr. Lansley: I beg to move amendment No. 12, in page 3, line 15, at end insert

    `, and—

    (c) there is a net reduction in the total burden on all those affected by the changes'.

We have moved on only to the end of these tests. We have in the course of the discussion understood, rather better on my part anyway, the nature of the tests that are to be applied before an order is made furthering these objectives. On Second Reading, I put a question pretty straightforwardly to the Minister, which those reading our proceedings might feel has not been answered completely. The question is not whether the order has to remove or reduce burdens because clause 3(2)(b) makes that clear. Indeed, the amendment in the other place provided for that. We know that an order will, among other purposes, remove or reduce burdens.

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We know, however, that the order has other potential objectives. It can create burdens and it can re-impose them. It can do so to an extent that, in the view of Ministers, is justified by the benefits that flow from it. Taking all those provisions as a whole, we do not know whether the net effect of such an order would be to reduce the total burdens on persons affected by the changes proposed in the order. Indeed, the Minister might have felt that I was asking a different question on Second Reading, such as whether an order must give rise to a reduction or the removal of burdens? The Minister made it clear that the answer to that is yes.My purpose in asking the question and tabling the amendment is to clarify that the overall effect of an order should not simply be that some burdens are removed or reduced, but that it should reduce the totality of burdens imposed on persons affected by the changes.

The amendment sets out to ensure that there is further limitation on the order-making power. With all the changes and objectives set out in clause 1, the Minister must be of the opinion that there is a net reduction in the total burden on all those affected by the changes. That is the purpose for which the Deregulation and Contracting Out Act was first created. That is why we set out to create an exceptional deregulatory purpose. The Minister described it as a super-affirmative procedure, which has considerable constitutional implications for the way that we conduct business in the House. I will not dwell on that as I raised it on Second Reading. The purpose of the amendment is to press the point.

Notwithstanding that, the Minister has said, quite fairly, that regulation schemes need to be affected by these orders, that they need to be able to apply to enactments more recent than those to which the Deregulation and Contracting Out Act would have applied and that the overall impact should be a deregulatory one. That is why the organisations—principally business organisations—to which the Minister was keen to refer on Second Reading welcomed the provisions of the Bill. They believe that they could be more effective overall as a consequence of delivering a lighter regulatory burden. They are also clear that that should not be overlaid by the consequences of the imposition of new burdens, whether outside the scope of the regulatory reform orders or, heaven forfend, by bringing back into the structure of such orders a framework of new regulatory burdens that would frustrate the deregulatory effect. We can deliver the purposes for which the business community, in particular, has sought only by ensuring, through an amendment such as this, that regulatory reform orders are deregulatory in their effect.

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