Select Committee on Delegated Powers and Deregulation First Report



FIRST REPORT


1 DECEMBER 1999


By the Select Committee appointed to report whether the provisions of any bill inappropriately delegate legislative power, or whether they subject the exercise of legislative power to an inappropriate degree of parliamentary scrutiny; to report on documents laid before Parliament under section 3(3) of the Deregulation and Contracting Out Act 1994 and on draft orders laid under section 1(4) of that Act; and to perform, in respect of such documents and orders, the functions performed in respect of other instruments by the Joint Committee on Statutory Instruments.


LIMITED LIABILITY PARTNERSHIPS BILL [HL]

INTRODUCTION

1.  The main purpose of the bill is to create a new form of legal entity - the limited liability partnership (LLP) which combines the organisational flexibility and tax status of a partnership with limited liability for its members. The bill is the final stage of a process which began with a Law Commission investigation in 1996 and led to the publication of a draft bill and regulations in 1998 and a revised text in July of this year.

2.  The draft bill did not undergo pre-legislative scrutiny in the House of Lords but was reported on by the House of Commons Trade and Industry Committee.[1] The Government's response to that report was published in June 1999.[2]

REGULATIONS

3.  Clauses 13 to 16 are concerned with regulations to be made by the Secretary of State.

4.  Clause 13 requires regulations to make provision about the insolvency and winding up of LLPs "by applying or incorporating, with such modifications as appear appropriate, Parts I to IV, VI and VII of the Insolvency Act 1986". That clause also allows regulations to make provision about the insolvency and winding up of "oversea limited liability partnerships" (bodies established outside Great Britain and having such links with Great Britain as may be prescribed).

5.  Clause 14 allows regulations to apply with modifications or disapply legislation about companies and partnerships.

6.  Clause 15 is a Henry VIII provision which allows regulations to amend or repeal primary and secondary legislation in consequence of the bill or regulations made under it.

7.  Clause 16 makes general provision about regulations. Subsection (2) lists particular provisions which may be made by regulations. These include creating criminal offences and imposing fees. Subsections (4) to (6) deal with Parliamentary control. Regulations are subject to negative procedure except where they deal with the matters listed in subsection (5) when they are subject to affirmative procedure. Thus regulations which deal with oversea limited liability partnerships or make amendments or repeals to any enactment are subject to affirmative procedure as are regulations which operate on the law about corporations or partnerships (other than specified sections in the Companies Act 1985).

8.  The Department's memorandum makes out the case for the regulation-making power and there has already been consultation about draft regulations. The power is wide, in particular in relation to insolvency, but as Clause 13 circumscribes the power in the way set out in paragraph 4 above the Committee considers that its apparent width is appropriate. The Committee has one concern about the power. The draft regulations create offences punishable on summary conviction by a fine but the power is wide enough to allow the regulations to provide for imprisonment or for trial on indictment. If, as seems likely, the intention is to provide only for summary trial and a fine, the Committee is of the opinion that it would be better for this limitation to appear in the bill, particularly as affirmative procedure is not applied to regulations creating offences. Apart from this the Committee sees the provision for Parliamentary control as appropriate.

RECOMMENDATION

9.  The Committee draws the attention of the House to the power to create offences by regulations and invites it to consider whether the bill should be amended to provide that such offences should be punishable on summary conviction by a fine.


ARMED FORCES DISCIPLINE BILL [HL]

INTRODUCTION

10.  This bill is the result of a review of the disciplinary system for the three Services which has addressed areas where there is concern that the system may not comply with the European Convention on Human Rights. Because each Service has its own legislation any change to the system requires three amendments although sometimes two amendments can be run together as, for example, in clause 8(1) which inserts the same new section in each of the Army Act 1955 and the Air Force Act 1955. This need to amend three codes makes it appear that there are many more delegated powers in the bill than in fact there are.

11.  The provisions of the bill supplement existing codes which already contain delegated powers and occasionally those powers are reflected in the text of the bill. For example, the new section 75 substituted by clause 1(1) in the Army Act 1955 provides, in subsection (4), that a person is to be treated as charged with an offence when "he is informed in accordance with regulations of the Defence Council that a charge is to be reported to his commanding officer". This report is concerned only with new powers created by the bill. These are identified and discussed in the Department's memorandum.

CLAUSE 1(1)

12.  New section 75D added to the Army Act 1955 applies sections 75 to 75C to persons delivered into military custody but allows the Secretary of State to modify by regulations those sections in relation to such persons. Regulations are subject to negative procedure.

13.  There is corresponding provision for the other Services in clause 1(2) (new section 75D of the Air Force Act 1955) and clause 1(3) (new section 47E of the Naval Discipline Act 1957).

14.  New section 75E added to the Army Act 1955 extends the powers of the Defence Council to make regulations so that supplementary provisions may be made to support sections 75 to 75C. Regulations may authorise the delegation of the commanding officer's functions, require the person in custody to be given information and require the keeping of records.

15.  There is corresponding provision for the other Services in clause 1(2) (new section 75E of the Air Force Act 1955) and clause 1(3) (new section 47F of the Naval Discipline Act 1957).

CLAUSE 8

16.  This clause inserts new sections in each of the three Service Acts to allow the Secretary of State to make "custody rules". The rules will be subject to negative procedure (subsection (3) of each new section). The rules will regulate proceedings under the new provisions inserted by the bill which relate to the extension of custody without charge, the bringing of a person in military custody before a judicial officer "as soon as practicable" and the review by a judicial officer of a decision to extend a period of custody without charge. The new sections list particular matters which can be included in the rules. These include representation of the person in custody, the admissibility of evidence and the circumstances in which the review of a decision to extend custody can be carried out without a hearing.

17.  Clearly the rules have an important part to play in ensuring the fairness of the new system. The memorandum explains that they will regulate, amongst other things, the arrangements preliminary to the proceedings, the representation of the person to whom the proceedings relate, procuring the attendance of witnesses and the appointment of persons to discharge administrative functions under the rules. The rules will also make provision as to the admissibility of evidence at custody hearings and as to the immunities and privileges of witnesses. The memorandum also suggests that given the very detailed nature of the provisions that will be required to be included in the rules, it is considered appropriate that they should be made by subordinate legislation. The Committee agrees with this approach but has considered carefully whether it is appropriate that a power wide enough to regulate the admissibility of evidence and the immunities of witnesses should not be subject to affirmative procedure. The rules will be part of a framework consisting of existing legislation and subordinate legislation made under it. The whole will have to be compatible with Convention rights under the Human Rights Act 1998. Against this background the Committee can accept that it is appropriate that the rules should be subject to negative procedure.

CLAUSE 22

18.  This clause inserts a new section in each of the Service Acts to allow the Secretary of State to make rules regulating the practice and procedure to be followed in the summary appeal court. Again the rules will be important and will be subject to negative procedure. The memorandum states that given the very detailed nature of the Rules and the fact that they will be substantially procedural it is considered appropriate that they should be made by subordinate legislation. The Committee agrees with this approach, and notes that rules governing the practice and procedure of courts martial are also contained in subordinate legislation.[3] Our comments in the previous paragraph about the appropriate level of Parliamentary control apply also to this power.

19.  The summary appeal court is created by clause 14 and there are applications of the rule-making power in subsection (6) of each of the new sections inserted by that clause as there are also in subsection (2) of each of the new sections inserted by clause 16 and in subsection (3) of those inserted by clause 19.

CLAUSE 23

20.  This clause inserts a new section in each of the Service Acts which provides for the Secretary of State to make an order (subject to negative procedure) prescribing the oath to be taken by a member of the summary appeal court before he sits for the first time and prescribing the person to administer the oath.

REGULATIONS NOT MADE BY STATUTORY INSTRUMENT

21.  Paragraphs 14 to 18 of the Department's memorandum discuss the provisions in the bill which confer on the Defence Council power to make regulations. Defence Council regulations are not made as statutory instruments and are not subject to Parliamentary control. The memorandum explains that the regulations need to be "sufficiently flexible to reflect operational requirements and the exigencies of Service life" and that the regulations are to be reproduced in Service manuals which will be available to all who need to have reference to them.

22.  The provisions of the bill are but a small part of a much larger already-existing disciplinary code, and the new comparatively minor provisions are in conformity with those approved by Parliament in the past. In view of the fact that Defence Council regulations will in future have to be compatible with Convention rights under the Human Rights Act 1998, we are content with the provisions of the bill. But we should note that Defence Council regulations deal with a wide range of matters, some important and some minor, and the time may come when Parliament will wish to consider whether the more important provisions should be subject to Parliamentary control.

RECOMMENDATION

23.  The House may wish to note the important rule-making powers in clauses 8 and 22 and our comments on the Defence Council regulations in paragraph 22 above. There is nothing else in the bill which the Committee wishes to draw to the attention of the House.


CHILDREN (LEAVING CARE) BILL [HL]

INTRODUCTION

24.  This bill confers powers to make regulations to provide for the detailed implementation of the policy embodied in the bill. The Department's memorandum explains the need for each new power and how it is likely to be used.

REGULATIONS UNDER THE CHILDREN ACT 1989

25.  Clauses 1 to 5 add provisions to the 1989 Act and in each clause there is an extension (or extensions) of the regulation-making powers contained in that Act. The 1989 Act provides for negative procedure. The memorandum explains that regulations for Wales will be made by the Assembly.

CLAUSE 6

26.  This clause is intended to ensure that those who gain benefits under the bill do not also qualify for benefits under the Jobseekers Act 1995 or the Social Security Contributions and Benefits Act 1992. The policy is that the local authority as "corporate parent" should be responsible for providing support for young people leaving the authority's care. But there are some groups of young people (lone parents and disabled children) who are eligible for welfare benefits even while living at home and it is not intended that such benefits should be denied to those to whom the bill applies. Subsection (6) is concerned with young people who have been in care in Scotland. The memorandum explains that if the Scottish Parliament decides to legislate on similar lines to the bill, there will need to be regulations excluding from benefits under the 1992 and 1995 Acts those young people who are being supported by a local authority in Scotland. Subsection (6) provides for this and subsection (9) applies affirmative procedure (presumably on the ground that the regulations will be removing benefits and that the Westminster Parliament will need to be satisfied that those concerned will be receiving appropriate support from Scottish authorities).

RECOMMENDATION

27.  There is nothing in the bill which the Committee wishes to draw to the attention of the House.


NUCLEAR SAFEGUARDS BILL [HL]

INTRODUCTION

28.  This bill is needed to enable the United Kingdom to fulfil its obligation under the Additional Protocol signed in Vienna on 22 September 1998. There is a simple commencement power and a power, in clause 3, to make regulations requiring persons in specified categories to identify themselves to the Secretary of State.

CLAUSE 3

29.  Regulations under this clause are subject to negative procedure. Failure to comply with the regulations is an offence punishable on summary conviction by a fine not exceeding the statutory maximum or on conviction on indictment by a fine - clause 9(1).

30.  Paragraphs 18 to 20 of the Explanatory Notes explain the need for this power and indicate the classes of persons at whom the regulations would be directed.

RECOMMENDATION

31.  There is nothing in the bill which the Committee wishes to draw to the attention of the House.


AREAS OF OUTSTANDING NATURAL BEAUTY BILL [HL]

32.  This private member's bill introduced by Lord Renton of Mount Harry is not materially different from the bill he introduced last session. On that bill we reported in our 13th Report of last session that there was nothing in the bill which we wished to draw to the attention of the House.

RECOMMENDATION

33.  There is nothing in the bill which the Committee wishes to draw to the attention of the House.


CRIMINAL JUSTICE (MODE OF TRIAL) BILL [HL]
CROWN PROSECUTION SERVICE INSPECTORATE BILL [HL]
PARLIAMENTARY COMMISSIONER (AMENDMENT) BILL [HL]

34.  Apart from simple commencement powers in the first two bills, these bills do not confer delegated legislative powers.


CONSIDERATION OF AMENDMENTS TO BILLS

35.  The Committee is pleased to record that its proposals in paragraphs 36 and 37 of its 29th Report of Session 1998-99, concerned with the time-scale for the tabling of Government amendments to bills, have been accepted by the Government. The attention of all Lords Ministers' Private Secretaries has been drawn to those paragraphs to help to ensure that those recommendations are implemented.[4] The Committee welcomes this prompt and positive response to our recommendation and believes that this will be for the benefit of the House.


COMPATIBILITY OF SECONDARY LEGISLATION WITH THE EUROPEAN CONVENTION ON HUMAN RIGHTS

36.  In the Committee's Report on the Immigration and Asylum Bill (22nd Report, Session 1998-99) we suggested that when a draft instrument under the bill came before the House for approval the minister moving the resolution should inform the House whether he is satisfied that the instrument is compatible with Convention rights. Lord Williams of Mostyn gave an undertaking to this effect during the passage of the bill[5] and the Government has since extended that undertaking to cover all resolutions approving affirmative instruments and any secondary legislation to the extent that it amends primary legislation. In the latter case if the instrument is not subject to affirmative procedure the statement of compatibility would be in writing, perhaps in the form of a letter to the Joint Committee on Statutory Instruments. The full text of the undertaking is set out in Annex 6. [6]


1  Fourth Report from the Trade and Industry Committee, session 1998-99, The Draft Limited Liability Partnership Bill, HC 59. Back
2  Eighth Special Report from the Trade and Industry Committee, session 1998-99, Government Observations on the Fourth Report from the Committee (Session 1998-99) on the Draft Limited Liability Partnership Bill, HC 529. Back
3  Department's memorandum, paragraph 9. Back
4  See Annex 5. Back
5  Official Report, 2 November 1999, columns 737-8. Back
6  This report is also published on the Internet at the House of Lords Select Committee Home Page (http://www.parliament.uk), where further information about the work of the Committee is also available. Back

 
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