Public Authorities (Fraud, Error and Recovery) Bill

Debate between Baroness Bennett of Manor Castle and Lord Verdirame

Committee stage
Monday 16th June 2025 Grand Committee

[Lord Verdirame (Non-Afl)]

My Lords, I agree with many of the concerns that have been expressed in connection with this group, but I will say a few words specifically in support of Amendment 79B in the names of the noble Lord, Lord Vaux, and the noble Baroness, Lady Kramer. As it stands, paragraph 1(1) in new Schedule 3B affords a very broad discretion to the Secretary of State. It says that the Secretary of State may, for the named purposes,

“give a person of a type mentioned in paragraph 2 a notice … requiring the person to take the following steps”.

On its face, this is an unfettered discretion—or, rather, it is a discretion limited only by the purpose. Other than those purposes, the discretion does not, on its face, have a limit. The power that the Secretary of State has under this clause is very broad because, on receiving those notices, the banks or financial institutions will have to take those two steps. Perhaps later we will explore the step in connection with the eligibility indicators, which is potentially quite intrusive.

It seems to me that the language proposed in the amendment would identify a standard—reasonable satisfaction—that would have to govern the exercise of this discretion. In that respect, together with a number of other amendments also proposed by the noble Lord, Lord Vaux—but particularly in the context of this power—the amendment seems extremely sensible. I urge the Government to consider it and, in due course, accept it.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I attached my name to the Clause 74 stand part notice tabled by the noble Baroness, Lady Kramer, and Amendment 80 tabled by the noble Lord, Lord Davies. The stand part notice is a simple solution, but the amendment of the noble Lord, Lord Davies, effectively, has the same impact, which is ensuring that you can investigate only when there is cause to investigate. I do not care which way it is done, but it is very clear—I associate myself with every word said by the noble Lord, Lord Davies of Brixton, here—that we are now at the sharp end of the Bill. As the noble Lord said and as I understand it, this is unprecedented in British law. This is going trawling; it is a fishing expedition and a mass intrusion. As the noble Lord said, quoting the DWP itself, it is about “‘persons unknown’ at scale”—that is an extremely telling phrase.

To put this in context, today the High Pay Centre put out its annual report on fat cat pay, which exposed what a hugely unequal society we have. It found that, on average, the top payees in organisations were getting 52 times as much as the median paid worker. The most extreme case of this that it found was the security and waste group Mitie, whose CEO was being paid 575 times the median salary of the workers. That is a comparison to the median but of course we know that many of those Mitie workers will be on the minimum wage or very near the minimum wage, and they will be in receipt of the benefits explicitly identified in the Bill. They will face their bank accounts being trawled through without their knowledge, while the CEO, with that lovely and enormously high pay level, does not face the same intrusion. This is a fundamental inequality in our society that is actively dangerous in terms of building the divisions within society.

The noble Lord, Lord Palmer, powerfully introduced the clause stand part notice, but I note his Amendment 89, which would ensure that the Bill may be used only in relation to the benefits listed in the Bill. I will not do the full Henry VIII story but, as is very obvious—it was made clear in the briefing I think we all received from the Justice organisation—with the Henry VIII powers, the Government can extend this to any other benefit. The one that immediately comes to mind, given how much it is in the headlines at the moment, is the personal independence payment—PIP—and the issues and the level of fear that already exist around that. I cannot remember the specific occasion, but I suspect that the Minister will have joined me, under the previous Government, in questioning Henry VIII clauses. This would shut the door on a Henry VIII clause, and it urgently needs to be done. I commend the noble Lord, Lord Palmer, for identifying that and putting the amendment down.