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Baroness Hollis of Heigham: I rather suspect the noble Earl, Lord Russell, seeks to tempt me down the road of social security support for students. I accept that there can be a problem of definition as to what counts as a full-time student and a part-time student given the 16 hours rule and so on. I recognise that where much study may be done at home there can be

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difficulties of definition. I am happy to refer those queries to my noble friend Lady Blackstone who is the Minister responsible for education. However, I hope that the noble Earl will allow me tonight not to engage in a debate about social security support for students.

What we seek here is simply the power to apply to the Student Loans Company or UCAS, or other relevant bodies, to find out whether someone who is claiming benefit also has the status of a student, or has been drawing student loan income or other incomes in such a way that impinges on his or her benefit claims. I think the Committee will understand the need for that information. We do not seek anything else that is private or confidential. If the noble Earl, Lord Russell, will permit me, I would prefer not to be tempted down the path of a general debate on student support and social security tonight.

Earl Russell: I thank the Minister warmly. She said everything that I hoped to hear. I assure her that I was not tempting her down the path of that general debate. That debate remains to be had but this is neither the time nor the place for it. I thank the Minister warmly.

Lord Astor of Hever: I am grateful to the Minister for her clarification of the point. I am also grateful to the noble Earl, Lord Russell, for the definition of a student. My two daughters are supposedly students although they are not always sitting in a class full-time or, indeed, working at home. In the light of what the Minister said, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 13 and 14 not moved.]

Lord Higgins moved Amendment No. 15:

    Page 2, leave out lines 22 and 23.

The noble Lord said: Amendment No. 15 appears towards the end of the series of amendments which are concerned with individual organisations. Amendment No. 15 is somewhat different in as much as it relates to the part of the Bill which is concerned with getting information from agents or servants of the aforementioned list of persons or organisations.

Our concern is the level at which the information is likely to be obtained. One presumes that the information is being obtained by the inspector from the organisation itself--the electricity or gas industry, or banks--rather than by the servant. That suggests that the obligation on an employee to provide the information to the person in government is different from that of the organisation by which he is employed: that he has some personal responsibility to produce the information. He may run into trouble with the business employing him if it does not want the information disclosed. The Government could have gone to the business rather than to the employee.

I understand that a problem arose with regard to the Electronic Communications Act. It was seen to place an unfair burden on employees to disclose information which they might not have. I understand that the first version of that Bill went back to the draftsman because one of the major objections was that the onus was

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placed on employees to disclose information to which at junior level they had only partial access. It will be helpful to ensure that we do not run into the same problem. Having recognised that problem, the Government then took a different line.

The problem arises as to whether the agent of a commercial organisation is bound by some contractual or other relationship to the person employing him as an agent not to pass on information when the information can be obtained from the principal. What information is likely to be obtained from the agent which cannot be obtained from the principal? Alternatively, is it in some sense a whistle-blowing operation--the agent knows that the principal is fraudulent and the Government wish to ask whether it is true that his principal is engaged in fraud? It is not entirely clear from the somewhat simple wording of the Bill. In the light of experience of the previous legislation, perhaps the Minister will clarify the position.

6.45 p.m.

Earl Russell: I ask for a clearer definition of what is implied by the words in the Bill. Is there any restriction in the way "agent" is defined which makes it clear who will be covered by the clause? I remember debates on IR35 during the Welfare Reform and Pensions Bill. There seemed a confusion of relationships between people who were or were not agents or employees. Will exactly who is covered by the clause be clear?

My other concern relates to diffusion. In our meeting, the Minister gave me reassurances on diffusion which were extremely welcome. I think that it is agreed that as information spreads among more people, the risk of wider disclosure increases in geometrical progression in line with the number of people who have the information. If more and more agents--related people, people in connected jobs, people who have done a single job on contract for a government--become involved and provide information, a series of "onion layers" may arise. If not, there may be difficulty in getting the requisite information.

It is a difficult problem to get round, but I should like to know exactly what the Bill means.

Baroness Hollis of Heigham: The issue is important for the security of a number of people. Therefore, I shall give a careful answer.

This amendment seeks to prevent authorised officers obtaining information from the servants and agents of the persons and bodies that can be required to provide information about identified individuals under the clause.

Perhaps I may set out who servants and agents are. Servants and agents can be the subcontractors of organisations. If a subcontractor held the information we needed, it would make sense to go to him as the servant or agent of the primary body rather than to the primary body itself. Servants are also the employees of a company. Putting it crudely, servants can be agents but also employees whereas an agent is a person

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authorised to act on behalf of another. According to Black's legal dictionary--I defer to my noble friend Lord Grabiner--a "servant" is a person employed by another to do work under the control and directions of the employer. In the same legal dictionary, an "agent" is defined as one who is authorised to act for or in place of another; a representative. That tends to be the distinction.

We need this provision to ensure that there is someone in the company to whom we can direct inquiries and make responsible for providing the information needed to identify benefit fraud. Generally, as the noble Lord, Lord Higgins, suggested, we would approach a company for information, and many organisations would want to nominate a central point for such inquiries either within the corporate body or within an organisation that works for them. Where this was the case, we would not direct our inquiries to anyone else. We would make this clear in the code of practice that would be published before implementing these provisions.

However, some organisations will not want to nominate a central point. If we were then unable to identify a way to direct our inquiries to the corporate body, we might need to direct our inquiries to an employee of the organisation who would be able to answer the inquiry.

The noble Lord, Lord Higgins, queried whether it could, therefore, be our intention to prosecute individual employees who do not provide information when required. In other words, how exposed are they? In the vast majority of cases, our inquiries will be made to the corporate body and it would be the corporate body which would be held to account for any failure to comply with the legislation.

There are only two situations in which we would prosecute an individual for failing to provide information under these provisions: where they themselves were the corporate body, or, very exceptionally, if an individual failed to provide information and would not seek a corporate backing to do so, perhaps because they had a personal interest in the case. In these circumstances, it would be right to hold the individual to account and not the corporate body.

I must stress that we do not expect to need to exercise the powers in this way. We are interested in obtaining information to fight fraud, and not in prosecuting those who work in the private and education sectors. But we need this provision to ensure that the powers work and to ensure that people take responsibility for failing to meet any legal obligations they impose. This will usually ensure that any decisions about compliance are taken corporately.

If anyone is worried about their employees being prosecuted for not providing information, the answer is that employees will not be prosecuted if they had the employer's corporate backing when they took the decision to refuse to provide information. I hope that that addresses the noble Lord's concerns. If it does not, it might be sensible to follow this with an exchange of

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correspondence. It is technical, but it is important to get the matter right and for the situation, including the point about whistle-blowers, to be clarified.

Given the information and the promise to follow up the matter by correspondence if the noble Lord wishes, I hope that he will feel able to withdraw the amendment.

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