Better Regulation

Lord Haskel Excerpts

Thursday 7th December 2017 Lords Chamber

[Lord Haskel (Lab)]

When President Jack Kennedy said that you do politics with the people not to the people, I always thought that what he had in mind was regulation. I agree with the noble Baroness, Lady Neville-Rolfe, when she said that regulation has to be well thought through, well explained and balanced and has to do the job. I add that neither should regulations be an excuse for skeleton Bills or for getting primary legislation through by stealth and hoping that nobody will notice.

After David Cameron’s Government promised an outright ban on fracking in national parks, many considered that they reversed that promise by smuggling a statutory instrument through Parliament. It is regulation that maintains the public good, sets standards, deals with market failure and encourages good business behaviour, and it is often executed through secondary legislation because it is quick. It is the bureaucracy, the cost and working with regulations that are the source of constant dispute and debate between business and the Government, as many noble Lords have explained.

The noble Lord, Lord Stoneham, gave examples from his experience. I suppose that I ought to own up that I benefited from regulation. My company made technical textiles; we developed fabrics that satisfied the very stringent safety standards required in civil aircraft, hotels and public places. Satisfying these regulations helped us to become a supplier to major aircraft manufacturers and hotel chains. Building such a niche is an important element in growing a business—and, yes, I benefited.

Frequently, in an effort to reduce regulation, there is a policy of one in and two or even three out—three out is probably a step too far, as the noble Lord, Lord Curry, said. Many of us feel that this numbers game and the constant pressure to reduce regulation has led to a reduction in standards. As the excellent Library brief said, the Grenfell Tower tragedy is probably an example of this. As a result, regulation is coming under much more scrutiny. Over the years, there have been efforts to minimise regulation, reduce the cost and quantify its effect but, on virtually every occasion, exclusions and the ill-defined scope and poor research have thrown doubt on the numbers. Noble Lords will remember the Red Tape Challenge and the Better Regulation Task Force. All these efforts eventually became discredited—the national minimum wage, for example, was excluded from a business impact target. We certainly need to improve the system, as my noble friend Lady Andrews said.

This is why the success or failure of regulation very much depends on parliamentary scrutiny. Central to this work is your Lordships’ Secondary Legislation Scrutiny Committee and Delegated Powers Committee. I declare an interest as a member of the Secondary Legislation Scrutiny Committee. We expect a government department to offer well-considered and easily understandable explanations to justify any statutory instrument and its likely impact, whether economic, social or environmental. The public should have an opportunity to respond. This is why your Lordships’ committee has maintained pressure on the Government to do exactly that.

The noble Baroness, Lady Neville-Rolfe, called for a champion. It was partly as a result of the pressure of this House that each department now has a Minister with special responsibility for secondary legislation, with a senior responsible owner—a senior civil servant—accountable for both process and quality. The Parliamentary Business and Legislation Committee in the Cabinet Office now overviews all secondary legislation across government. Only last month, we were told that Stephen Barclay MP is now acting as the secondary legislation champion at the Treasury, and we were given assurances that there is now a focus on better management within all departments.

I agree with the noble Baroness, Lady Altmann, that the Government’s administrative convenience must not take priority over the interests of the potential respondents to regulation, because poorly prepared regulation can hold back growth and productivity. Perhaps the record occurred in February 2013, when the Department of Health laid regulations to govern the use of tendering in the procurement of NHS services. Your Lordships’ committee received 2,000 submissions, most of which indicated a belief that the regulations did not match up to ministerial undertakings. Quite rightly, the committee reported the SI on the grounds that it might imperfectly achieve its policy objective and, of course, it was eventually changed.

Other noble Lords have spoken about the European Union (Withdrawal) Bill, and the problems which arise from incorporating EU regulations into UK law. Clause 7 of that Bill allows Ministers to use secondary legislation to help achieve this. The number of secondary instruments to be scrutinised will easily double or possibly treble. Last year, your Lordships’ Secondary Legislation Scrutiny Committee scrutinised 1,200 SIs. In addition, there will be new regulations for trading with the rest of the world when we are outside the EU. Indeed, ending the flood of regulations from Europe was central to the Brexit campaign. However, it looks as if we are going to have a lot more work as a result of that. Much of the domestication of the acquis will be done through statutory instruments. I repeat that the procedure of explanatory memorandum impact assessments and costs will have to be carefully worked out on each one so that Parliament and the public can judge whether the resulting SI is equivalent to the effect of the EU derived legislation or has to be changed. I add that your Lordships’ committee would not be able to carry out this work effectively without the support of its experienced and hard-working staff.

Several noble Lords have referred to the current concern of the Secondary Legislation Scrutiny Committee—namely, that two weeks ago, the Minister wrote to the Public Accounts Committee in another place, saying that where the impact is less than £5 million his department’s analysis will be more proportionate. Presumably he is trying to reduce the government workload. I will not repeat the questions put by the noble Baroness, Lady Andrews and others, but quite rightly the committee has written to the Minister, saying that, irrespective of this threshold, standards have to be maintained. They have to be maintained because this is our major check on the Government. I hope that the Government will give us an assurance that these standards will be maintained; otherwise, the Government—any Government—can look forward to more pressure from your Lordships, because regulation has to be done with the people, not to the people.

--- Later in debate ---

[Lord Henley]

I do not know how the noble Baroness received it, but she will be aware that it was an internal letter from me to colleagues within government. As far as I am concerned, that amounts to a leaked document.

[Lord Haskel]

I can shed a little light on the subject. The letter was from the Minister to the Public Accounts Committee in another place.

[Lord Henley]

I think the noble Lord is referring to another letter. The postal service has been quite busy. I will come to the comments of the Public Accounts Committee in due course. I am referring to what amounts to a leaked document.