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This appears to apply to just about every company quoted on the stock exchange, and many that are not, because there is a kind of escalation. The guards may be employed by Securicor, Group 4, Reliance, any one of the large firms. The engineering firm--though it could be anything: a chemical firm or whatever--supervising those people is definitely caught under paragraph (d). Therefore, under paragraph (f) every other director of virtually every firm will require a licence. I cannot believe that that is what the Government intend, but it seems to me, reading these paragraphs together, that that is how everybody will be caught.
Viscount Goschen: This matter has caused concern in industries across a wide range of activities. For example, the cinema industry has expressed concerns very similar to those expressed by my noble friend, Lord Cope of Berkeley, in connection with paragraph (d). I understand--the noble Lord the Minister will correct me if I am wrong--that the industry is exempt from some other provisions of the Bill in the day-to-day conduct of its business. But if a cinema company brings in security guards for a premiere, or some other special event, there will be a burden on the person within that cinema company who contracts with the security company in that that person will need to be licensed. This would be a very good opportunity for the Minister to clarify his understanding of the implication of paragraph (d). Basically, the question is this: does it mean that any company that hires a security company must itself be licensed?
Lord Bassam of Brighton: I am grateful to noble Lords for their further clarification of the amendment. Perhaps to say that we are at cross-purposes would be to use the wrong term, but there may well be a misreading of the clause, because it is certainly not our intention that the personnel director of the engineering company in the example given by the noble Lord, Lord Cope of Berkeley, would have management responsibility for the security staff at the gates of the company's premises, nor that that director would need to be licensed. We are talking about the management of the security company itself, not of the engineering company that is contracting those working for that company.
Viscount Astor: The Minister has dealt with Amendment No. 11 to a degree. What he is saying, as I understand it, is that anybody who uses a firm will not be covered by the provision; it is only in the firm doing the security work that the director is covered. That is fine as far as it goes, but some very large companies contain individual companies--wholly owned, associated or whatever--that have contracts between themselves. Therefore, it is perfectly possible for there to be large organisations that in certain circumstances carry out security work in a plant that they perhaps do not wholly own. Whatever the reason, it seems in principle that if they could be covered it must make sense for liability to attach only to those who are, as it were, licensed people themselves. Paragraph (f) seems to extend the responsibility to those who will not be licensed by the new authority. That seems wrong in principle.
I accept the principle that if one is involved in the security industry and is a licensed person, whether an individual, a partner or a director of a company, one should be responsible, and that that licensed person must be the responsible person. But it seems wrong to extend that responsibility perhaps even to a non-executive director of a security firm and make him or her responsible for the activities of the managing director or someone else in charge. That is in fact what the Bill does, and it is a step too far.
I hope that the Minister will consider the matter, because we shall want to return to it at a later stage. I cannot believe that it is the Government's intention to extend that responsibility further than necessary, bringing in a whole class of people. I am all for making those who come within the orbit of the security industry authority become licensed, making them responsible in a corporate, individual and partnership way, but there must be some ring-fencing or the matter will become very difficult.
I do not find much on which to disagree with the Minister as regards my earlier amendments. As he said, it is very much a matter of how the new authority will work. The more I listened to what he said--and I shall read it carefully in Hansard--the more I realised that we shall have to examine Schedule 2 more carefully, and perhaps look to add detail there. The schedule can be changed by the Secretary of State by order. Therefore, it can be changed in any direction, in effect depending on the Secretary of State of the day. We shall want to make sure that Clause 1 says what it means to say and what the Government mean it to say. There is a tendency in the passage of legislation for the Government to say "This is what we think the Bill says. If we have got it wrong, we shall change it by order later". We should like to try to avoid that and get Clauses 1 and 3 right before the Bill leaves the House.
The noble Lord said: We now come to the question of inspections. We propose adding the words in the amendment because the first point on inspections is that the inspectors employed by the authority will presumably not only inspect those who have licences, or are clearly engaged in activity which requires a licence, but will also, at the margin, look to see whether some people who do not have licences, and are not necessarily clearly engaged in licensable conduct, are engaged in conduct for which they should have a licence. Therefore, the inspectors will be able to check up on them and fine them if necessary, or ensure that they obtain a licence. If the inspectors find themselves rejected, as it were, by a firm that they think may require a licence but does not have one, they may have difficulty.
This question also raises more general points as to who and what the inspectors will inspect. Some in the industry have called for what they describe as mandatory inspections, which I take to mean that there would be a regular inspection once a year, or at some such period, of everybody with a licence. But that would be enormously expensive and not necessarily essential. We are all keen--I know that the Government are, as we are--to keep the regulations in proportion to the difficulties in this field.
The question of who and what will be inspected makes a difference to the number of inspections required. We know that several hundred thousand people will require licences. There are various estimates, but 300,000 is widely suggested. To have any reasonable inspection, even ongoing, of 300,000 people and the companies they work for, spread around the whole country, will take quite a large force of inspectors. That in itself will be reflected in the cost of the whole regime, which will fall on the industry. It would be helpful to know what kind of inspection is envisaged by the clause giving this duty to the authority. Flowing from that, how large a team of inspectors, roughly speaking, do the Government anticipate will be required to carry out this duty? I beg to move.
Lord Bassam of Brighton: As I understand it, the amendment seeks to extend the authority's inspection function to those suspected of being engaged in licensable conduct. It seems to me to be a novel device for expanding the remit of the security industry authority.
We take the view that the security industry authority already has more than enough powers and teeth to enable it to carry out its inspection function using the provisions contained in Clause 18. After all, these powers would allow a person authorised by the authority to enter premises and to carry out inspections of the documents of any person appearing to be a regulated person. I suppose that "appearing" in these terms could be construed as being in some way similar to "suspected". This refers, broadly, to someone who has, or the authority believes ought to have, a licence. We
The White Paper looked at this question and suggested a low estimate in terms of numbers. We do not want to see a massive inspectorate but one which is proportionate to the size of the problem. In constructing the inspectorate we shall, of course, talk very carefully with the private security industry. If we were to expand the remit of the authority in the way suggested by the noble Lord's amendment, we would push those numbers up. As the authority will be financed through fees collected, that would tend to lead to an excessive burden on the industry. That is not what we want. We need to keep the numbers in proportion.
We expect the number of inspectors to be at the lower end of the range. I cannot be precise on numbers today. However, I undertake to take the matter away and do more research. Obviously, in constructing the size of the inspectorate, we shall consult carefully with the industry. In the light of those reassurances, I hope that the noble Lord will feel able to withdraw his amendment.
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