Select Committee on Delegated Powers and Deregulation Seventeenth Report


ANNEX 2

ROAD TRAFFIC (VEHICLE TESTING) BILL

Memorandum from the Department of the Environment, Transport and the Regions

1. This Memorandum, submitted by the Department for the Environment, Transport and the Regions, identifies those provisions of the Road Traffic (Vehicle Testing) Bill (the Bill) which give powers to make delegated legislation. It explains the purpose of the relevant power, the reason why the matter is to be left to delegated legislation, and the nature of, and the reason for, the procedure selected.

Outline and Scope of the Bill

2. The principal purpose of the Bill is to provide a statutory framework for the establishment of a central computer record of the MOT test status of vehicles.

3. The Bill also modifies the existing regulation-making powers associated with MOT testing so as to make them more relevant to a computer-based scheme and to allow information to be released or sold from the record.

4. In addition, the Bill clarifies the legal status of persons authorised to supervise or carry out MOT tests and it makes a number of associated and consequential amendments.

BACKGROUND

5. Under the existing provisions of section 45 of the Road Traffic Act 1988 (the Act) the Secretary of State may, by regulations, make provision for the periodical examination of vehicles to ensure that they comply with prescribed statutory requirements of roadworthiness. In simple terms, the section provides the statutory framework for MOT testing. The Motor Vehicles (Tests) Regulations 1981, as amended, SI 1981/1694, give effect to the provisions in the Act.

6. Section 45 provides for MOT tests to be carried out by 'Authorised Examiners' (MOT testing stations proprietors) or 'Designated Councils' who are authorised or designated, respectively, by the Secretary of State for this purpose; and by examiners appointed by the Secretary of State (a small number of civil servants who work for the Department's Vehicle Inspectorate Executive Agency). In practice most of the 22 million or so MOT tests which are carried out annually are carried out at one of the 19,000 or so private-sector MOT testing stations around the country. Tests are actually carried out by 'Nominated Testers', working under the supervision of Authorised Examiners, who are to be formally recognised on the face of the Act in future, under the provisions of Clause 1 of the Bill. Some MOT tests are carried out by inspectors employed by the 120 or so Designated Council local authorities.

7. The existing provisions of section 46 of the Act enable the Secretary of State to make regulations dealing with the practical aspects of MOT testing. The main aspects of the regulations which may be made under these provisions deal with, for example, the conditions to be complied with by 'MOT testing stations' and the manner in which MOT tests have to be carried out. In practice, these provisions enable the Secretary of State - through the Vehicle Inspectorate - to set test standards administratively and to ensure that MOT testing stations work to these standards. The provisions also enable the Secretary of State to prescribe the maximum level of MOT fee, which includes a small element which is used by the Inspectorate to finance their work in supervising the MOT scheme. At present the maximum fee which can be charged for MOT testing a car is £30.87 and this includes a charge of £0.58 which is retained by the Inspectorate. At present the charge of £0.58 is levied under the provisions of section 46(d) of the Act for the supply by the Inspectorate of blank forms for MOT certificates, and the scope for using this charge additionally for their supervision of the MOT scheme is provided for under the Department of Transport (Fees) Order 1988, as amended (SI 1988/643).

8. The proposal to introduce computerisation into the MOT scheme does not need new legislation in order to proceed and the necessary arrangements to link MOT testing stations to a central computer database of the results of MOT tests is already underway. However new legislation is needed to ensure that the introduction of computerisation into the scheme will bring maximum benefits. In summary, the main benefits of introducing computerisation with the benefit of the provisions in this Bill are:

  • It will help to eliminate the theft and forgery of MOT certificates - because the Bill will make it possible for the Inspectorate to raise the charge for their supervision of the MOT scheme by charging for making entries on the MOT computer database rather than through the supply of blank forms of MOT certificates.
  • It will be possible to improve significantly enforcement of the requirement to hold a valid MOT certificate - by enabling the police to have bulk access to information from the record of MOT tests through the provisions of Clause 2 (new subsection 46(5)); and, also through the provisions of Clause 3.
  • It will be possible to sell information from the database, which is in demand from many interested parties including consumer groups through the provisions of Clause 2 (new subsection 46(6)). The Inspectorate will, in turn, use any surplus income from the sale of information to help offset the cost of introducing computerisation, which is a cost motorists will have to bear through a small increase (£1 or so) in the cost of obtaining an MOT certificate.
  • It will pave the way for dispensing with the requirement for motorists to produce an MOT certificate when relicensing their vehicle and pave the way for introducing telephone relicensing of vehicles (Clause 5).

Proposals for Subordinate legislation

CLAUSE 1 : TESTS OF SATISFACTORY CONDITION OF VEHICLES

9. Paragraph (3) provides for a new subsection 45(6A) in the Road Traffic Act 1988. This will enable the Secretary of State to provide or to make arrangements for the provision of courses of instruction about MOT testing, as he does at present. It will also enable him to prescribe fees to be paid for attendance on such courses. This is a new proposal designed to make those who benefit from the courses responsible for paying for them - a concept supported by trade bodies when the MOT scheme was reviewed in 1994.

10. Those persons who are involved with MOT testing are already required to complete such training courses but, in future, it is envisaged that they will be asked to pay for their attendance on such courses rather than having that cost subsidized by motorists, as it is at present, through the charge made by the Vehicle Inspectorate for supplying blank forms for test certificates to testing stations. Whilst this will result in some small additional burden on trainees, this will be reflected in the business overheads of testing stations which are taken into consideration by the Secretary of State when setting the maximum levels of MOT fees. In short, motorists will still be subsidising training costs, but through that element of the MOT fee which is retained by testing stations rather than through that element of the fee which is retained by the Inspectorate. The benefit in making this change is that it will encourage Authorised Examiners and Nominated Testers to consider more carefully when and whether they wish to be trained to work within the MOT scheme - at present some testing station staff are only put forward for training as a contingency measure which wastes resources and introduces the risk that testing skills will be jeopardised through lack of practice.

CLAUSE 2 : REGULATIONS UNDER SECTION 45 OF ROAD TRAFFIC ACT 1988

11. Clause 2 of the Bill will replace the existing section 46 of the Road Traffic Act 1988, with some modifications, thereby defining the scope of regulations which may be made by the Secretary of State under section 45 in connection with the MOT testing scheme.

12. Clause 2(1) will re-enact most of the existing provisions of section 46 of the Act and adds further provisions. The paragraph was drafted in this way because it was considered better to consolidate the legislation into a single section of sequential provisions rather than to seek to amend a large number of isolated parts of the existing provisions. In simple terms, this was done for ease and clarity of drafting and to make the legislation easier to work with in practice.

This following section of this Memorandum considers only the new provisions under section 46 of the Act to be added by the provisions of this Bill.

13. Subsections (1)(e) and (3) will enable the Secretary of State to make provision for supervision of examinations and MOT testing stations. In particular, subsection (3) will enable the Secretary of State to require an Authorised Examiner to nominate a supervisor to act on his behalf whenever he is absent from an authorised MOT testing station. Additionally the provision will enable the Secretary of State to impose conditions to be complied with by 'nominated supervisors', and the circumstances in which such a person ceases to be a nominated supervisor. At present, difficulties can arise where, for example, an Authorised Examiner runs several MOT testing stations and obviously cannot be present at all of them at the same time to oversee what is going on there.

14. Subsection (1)(i) will enable the Secretary of State to provide in regulations for factual errors in MOT certificates to be corrected - for example where the make or colour of a vehicle has been incorrectly recorded. At present, where errors are made the vehicle presenter will normally be issued with a replacement certificate by the Authorised Examiner containing the correct information. In future, however, the correction of factual errors will have to be undertaken via the computer database of records because all of the information which will be used to print the certificate remotely in testing stations will be held on the central record of the results of MOT tests. This means a new and specific power will be needed to facilitate such transactions.

15. Subsections (1)(j) and (4) deal with the charges payable to the Secretary of State by authorised examiners or designated councils on the notification to the proposed MOT database of the result of an MOT test; on the issue of duplicates or copies of test certificates; and on the correction of errors in test certificates. Subsection 4(a) enables the Secretary of State to require payment on account from authorised examiners and designated councils for entering the results of MOT tests into the proposed MOT database. The provision will also enable the Secretary of State to require payment on account and at prescribed times of such amounts as he may determine in accordance with the regulations. Subsection (4)(b) reproduces part of existing section 46(d) so that the Secretary of State may, where necessary, continue to charge for supplying, in advance of MOT tests, blank forms for test certificates and notifications of refusal of test certificates. This provision needs to be retained both for transitional purposes and as a fall-back. Subsection (4) also provides for money paid on account to be repaid in prescribed circumstances.

16. In essence, the provisions of subsections (1)(j) and (4) simply reflect the principle of what is provided for by existing section 46(d) of the Act. They merely provide the means whereby the Vehicle Inspectorate can earn an income from the MOT testing scheme to enable them, in turn, to supervise the scheme. At present their income comes from the supply of blank forms for test certificates to testing stations but since certificates will, in future, be generated remotely in testing stations, there is a need to provide an alternative funding mechanism which relies instead on the entry of the results of MOT tests onto the central database record. The new provisions do this and also ensure that the Inspectorate's future income from the scheme can be managed on a similar basis as it is at present, with Authorised Examiners effectively pre-funding the notification of the results of MOT tests. In effect they already do so under current arrangements because they purchase up to 200 blank MOT certificates at a time from the Inspectorate - and this allows both the Authorised Examiners and the Inspectorate to plan their work and cash flows and process payments in a manageable way.

17. Subsection (2) will enable the Secretary of State to require that persons connected with MOT testing should successfully complete training courses as distinct from simply attending them. In addition, to pay such fees as may be prescribed in connection with applications for the Secretary of State's authorisation, approval or designation. As with the cost of training, at present these costs are also subsidized by motorists through the charge made by the Vehicle Inspectorate for supplying blank forms for test certificates to testing stations.

18. Subsection (5) will enable the Secretary of State to make information available from the MOT records to prescribed persons on payment, in prescribed cases, of a reasonable fee. This provision would allow the Secretary of State to disclose information from the MOT database in accordance with regulations. It is envisaged that regulations could, for example, provide for:

  • the issue, on payment of a reasonable fee, of information relating to the MOT status of a vehicle, to any person who could demonstrate that they had reasonable cause for wanting such information;
  • the issue, on payment of a reasonable fee, of the recorded 'MOT history' of a vehicle, to any person who could demonstrate that they had reasonable cause for wanting such information; and
  • the issue of information to the police relating to the MOT status of vehicles (free of charge and via the Police National Computer).

This subsection is drafted in similar terms to section 22(1)(c) of the Vehicle Excise and Registration Act 1994.

19. Subsection (6) will enable the Secretary of State to sell particulars contained in, or derived from, the MOT records. The particulars and information could be sold:

  • to such persons as the Secretary of State thought fit;
  • for such price, on such terms and subject to such restrictions as the Secretary of State thought fit; but
  • without identifying the premises at which an examination was carried out or any person concerned with the carrying out of an examination.

By contrast with subsection (5), this provision would enable the Secretary of State to sell data at a price which reflects its commercial value. It is envisaged that such terms of sale might be agreed where, for example, information was being sought by consumer organisations, vehicle manufacturers, vehicle insurers and companies which specialise in the provisions of information about second-hand vehicles offered for sale. Under the provisions of this subsection it would be possible for the Secretary of State to maintain flexibility in relation to the terms and restrictions in any particular case - for example, relating to the use to which such information could be put - which terms and restrictions could not easily be provided for in primary legislation. This subsection is drafted in similar terms to section 22(1A) of the Vehicle Excise and Registration Act 1994.

CLAUSE 5 : SATISFYING CONDITIONS FOR GRANT OF VEHICLE EXCISE LICENCE

20. Section 66 of the Road Traffic Act 1988 currently enables the Secretary of State, by regulations, to prohibit the grant of a vehicle excise licence unless one of several conditions is met. For the purpose of such regulations Clause 5 adds paragraph (aa), as a new condition, to section 66(2) of the Road Traffic Act 1988. Under this provision, a vehicle could be relicensed without producing an MOT certificate, because the Secretary of State could rely instead on information contained in the proposed database of MOT records.

21. Although it will probably still be necessary in the short term for motorists to continue to take their MOT certificates with them when relicensing their vehicle, the provision will enable the Secretary of State to introduce 'paperless' relicensing transactions over the telephone, for example, at some point in the future. This will not be possible in the short term because there is currently no equivalent database of driver insurance information available although the insurance industry is seeking to develop one.

CLAUSE 6 : ORDERS RELATING TO FEES CHARGEABLE BY VIRTUE OF SECTION 46 OF ROAD TRAFFIC ACT 1988

22. Clause 6 refers to section 102 of the Finance (No.2) Act 1987 which enables a Minister of the Crown, by order, to specify what additional matters are to be taken into account when fixing fees and charges. Such an order requires affirmative resolution of the House of Commons in order to be given effect.

23. The Department of Transport (Fees) Order 1988 (SI 1988/643) includes a provision relating to fees chargeable by virtue of section 46 of the Road Traffic Act 1988. It will require amendment as a result of the Bill. In particular, the Order will need to make it clear that the mechanism of charging for the Inspectorate's income to supervise the MOT testing scheme has changed - from supplying blank MOT certificates to charging for notifications of the results of tests to the database of MOT records. The Order may also need to make clear that the scope of what this income is used for may be expanded in future to include, for example, cross-checking of information on the database of MOT records with the database of records maintained by the Secretary of State under the Vehicle Excise and Registration Act 1994 (as provided for under Clause 3); and, for more rigorous checking of MOT certificates in vehicle relicensing transactions. All of these functions are directly related to the purpose of carrying out MOT tests and therefore to the charge for notifying test results to the MOT database.

24. In the ordinary course of events an amendment to the Fees Order would be made by way of affirmative resolution (of the House of Commons only). The DOT Fees Order has been amended several times this way already. However, since the matters which are likely to be the subject of the contemplated amendment would have already been considered by the House of Commons during the consideration of this Bill, it was felt that it would be helpful to include a provision in the Bill for a negative procedure so as to avoid having to discuss the same issues again.

25. As a safeguard against any possible risk of negative procedure being used for a wider purpose, Clause 6 relates only to section 46 of the Act, and only to an Order which is made within twelve months after Royal Assent.

May 1999


 
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