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Baroness Hamwee: My Lords, I shall certainly withdraw the amendment at this stage because I want to read carefully what the Minister has said. In drawing attention to subsection (2) of Clause 5, she alerts me to the fact that an order can make different provision for different authorities and can require specified functions to be reviewed in specified financial years; but the subsection does not--although one might be able to read

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the point across from other provisions, a point that we shall have to examine--state that the order may make different provision for different functions. We shall want to consider the point carefully. I believe that the Minister takes the point that I have been making. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 10 [Inspections]:

Lord Dixon-Smith moved Amendment No. 18:

Page 8, line 25, at end insert ("and inform the authority concerned")

The noble Lord said: My Lords, Clause 10 gives the Secretary of State power to order a best value inspection by the Audit Commission under what might be described as emergency circumstances. In establishing such an emergency inspection, the Secretary of State "shall consult the Commission" before giving a direction. I believe that the Secretary of State should also inform the authority concerned.

In reality, it is probably inconceivable that one would arrive at this situation without the authority knowing that it was in trouble. I do not think it would be surprised. I suspect that such a direction would arise at the end of a year or two, or even as many as five years, of descent in satisfaction with the administration of a service. But as the Secretary of State is obliged to consult the commission before establishing a special review, it would not be unreasonable to require him at the same time to inform the authority concerned formally that that was going on. I beg to move.

Baroness Farrington of Ribbleton: My Lords, as we discussed in Committee, I recognise that generally speaking it is important for authorities to know when they are to be inspected. However, we believe Amendment No. 8 to be unnecessary and undesirable, as it would constrain the Secretary of State's ability to act swiftly to investigate a seriously poor-performing authority.

For routine planned inspections as provided for in Clause (1)(1), it would be sensible working practice for the authority about to be subjected to inspection not only to be informed but also to be consulted about timing. That will help to prevent duplication of effort by inspectors and will avoid authorities being subject to too many inspection visits at a time, and will ensure that key personnel are on hand to assist in the process.

In most instances, in the interests of inspector and inspected alike, authorities will also be notified in good time of inspections directed by the Secretary of State. Sometimes, however, where serious failure has occurred, inspectors may be asked to act swiftly to gather evidence in order to establish facts and identify problems. If vulnerable members of the community may be at risk, we need to ensure that the system can work effectively to uncover the problem so that it can be addressed as a matter of urgency.

Placing a requirement on the face of the Bill that a notification be given before a directed inspection is ordered would therefore place an unnecessary restriction on the flexibility of the Secretary of State to respond quickly where such urgent investigation is needed.

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In addition, the Bill already provides under Clause 11 that inspectors themselves should give authorities three days' working notice of the actual inspection. That should be sufficient to ensure that, even in the most urgent of cases, a proper balance is struck between the need to achieve prompt scrutiny in the interests of people who may be vulnerable and the need properly to protect the interests of the authority and its employees. I hope that that reassurance will encourage the noble Lord to withdraw his amendment.

Lord Dixon-Smith: My Lords, I am grateful to the Minister for that reply. It gives me some solace. I shall need to study it with care. I find it somewhat fascinating that informing the local authority--which, after all, takes no more than a telephone call--might actually constrain the powers of the Secretary of State. If that is all it takes to constrain the powers of the Secretary of State--which were the words of the noble Baroness--I must phone him more often. I believe that that would be an excellent thing to do.

When one considers vulnerable people in particular, certainly nothing that I say is intended to reduce the power to carry out such investigations, properly examine the position and put right whatever is wrong. But where there are really urgent cases--it must be faced that in the past some have arisen--almost invariably they are likely to give rise to criminal investigations, which are probably already under way by the time we get to this procedure. I find that reason for rejecting this particular amendment somewhat strange. However, I undertake to study carefully what has been said. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 11 [Inspectors' powers and duties]:

Baroness Hamwee moved Amendment No. 19:

Page 9, line 1, at beginning insert ("Subject to subsection (4A),")

The noble Baroness said: My Lords, in moving Amendment No. 19 I should like to speak also to Amendments Nos. 20 and 21. Amendment No. 19 is a paving amendment. Amendment No. 20 provides that normally notice of at least 28 days will be given before an inspector goes in. Amendment No. 21 provides for extraordinary inspections where shorter notice of not less than three days, which is the notice provided in the Bill, will be given.

We were assured in Committee that the provision giving three days' notice would be used very rarely. The Minister said it was,

    "anticipated that the period of such notice will normally be greater not only than the three days set out in Clause 11 but also than the 10 days proposed by Amendment No. 61".--[Official Report, 10/5/99; col. CWH 63.] That was the amendment I then moved. She went on to say that the provision in Clause 11 mirrored the conditions for extraordinary audit in Section 25(4) of the Audit Commission Act 1998. That tempted me to look up the section. As the Minister said, the section provides for three days' notice but explicitly where the Secretary of State considers it desirable that, essentially, short notice should be given.

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The provisions that I seek to include in the Bill now mean that normally at least 28 days' notice will be given. That picks up the point that more than my previously suggested 10 days' notice would be given. The new subsection (4A) in Amendment No. 21 mirrors Section 25(2) of the 1998 Act, which provides:

    "If it appears to the Secretary of State that it is desirable in the public interest that there should be an extraordinary audit of the accounts of a body subject to audit he may require the Commission to direct such an audit by an auditor or auditors appointed by it". The section contains particular provisions that apply to an extraordinary audit. I have attempted to reflect that approach in these amendments. I believe that it would be appropriate for the meaning of the Bill to be more detailed rather than allow for very draconian powers to be used which, by common consent, will not be applied in ordinary circumstances. I beg to move.

Baroness Farrington of Ribbleton: My Lords, as I explained in discussing the previous amendment, we consider that the minimum notice period of three days currently set out in Clause 11 will ensure that a proper balance is struck between the need to achieve prompt scrutiny and the need properly to protect the interest of best value authorities and their employees.

It may help to reassure the noble Baroness if I explain that the intention of subsection (4) is not to fix the amount of notice at three days--I believe that that has become clear at Report stage--but merely to specify the minimum period which can be given. We anticipate that significantly more than the 28 days' notice specified in Amendments Nos. 19, 20 and 21 will normally be given to the authority being inspected.

However, we believe that the question of a standard period of notice to inspect authorities is an important one. The Audit Commission is currently looking at the question of notice periods as part of the process of setting up the new best value inspectorate. It will be taking into account the current practice of existing inspectorates and opinions such as those expressed in the recent Work of Ofsted report issued by the Education and Employment Committee in another place. This report also suggested a notice period of 28 days. The noble Baroness will be aware that existing inspectorates have quite different notice periods, from the Benefit Fraud Inspectorate at three months through to Her Majesty's Inspectorate of Constabulary at six months and the Fire Service inspectorate at 12 weeks.

We envisage that very short periods of notice will be needed only in extreme cases, for example, those where there is serious failure or where an authority has not responded to a normal notice of inspection. In such cases, the ability to move quickly will be invaluable. Clause 11 as drafted provides an appropriate mechanism to achieve this. I hope that, reassured by these comments, the noble Baroness will not feel it necessary to press her amendments.

8.45 p.m.

Baroness Hamwee: My Lords, I am not entirely sure that the Minister's response has taken the matter a great deal further. The noble Baroness spoke of the importance of a standard period of notice. It seems to

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me that if the legislation provides for three clear days' notice--I accept that that is a minimum and that generally, in normal circumstances, much longer notice will be given--and it is known that very often it will be far longer than that, that goes against providing a standard.

The Minister spoke of the need to deal with extreme cases. I believe that that is precisely what Amendment No. 21 does. I have followed as closely as I can the language of the Audit Commission Act. I shall not press the point further; it would be tedious to do so now. However, while I am reassured by the thrust of the Minister's response, I am not satisfied that best value authorities have the protection that they are entitled to see on the face of this legislation as to what the normal situation will be. Only the abnormal and extreme appears to be catered for. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 20 and 21 not moved.]

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