GROUNDS ON WHICH POWERS ARE EXERCISABLE (Hansard, 17 July 1973)

§ Mr. Kenneth Baker
I beg to move Amendment No. 12, in page 13, line 9, leave out from 'information' to end of line 10, and insert: 'to the Secretary of State under or for the purposes of any provision of the Act of 1958, Part II of the Act of 1967 or this Act;' The amendment is another which results from a suggestion contained in an Opposition amendment in Committee. We then accepted the amendment in principle, subject to redrafting.
The effect is to widen the unnecessarily restricted ground for intervention in Clause 12(1)(c)—Hon. Members will remember that the clause is one of the central clauses in the Bill—so that the 386 furnishing of misleading or inaccurate information to the Secretary of State under or for the purpose of, any provision contained in the 1958 Act, the 1967 Act or the Bill constitutes a ground for invoking any of the powers in Clauses 13 to 21. The existing wording of Clause 12(1)(c) would permit the invocation of these powers only when the misleading or inaccurate information is furnished in connection with an application for authorisation.

§ Mr. Kenneth Baker
I beg to move Amendment No. 13, in page 14, line 2, leave out '14' and insert '13'.

§ Mr. Speaker
With this we are taking Amendment No. 18, in page 19, line 27, at end insert: '(6) This section shall not apply in relation to the exercise of the power conferred by section 13 above where, by virtue of subsection (4) of section 12 above, it is exercised by the Secretary of State when issuing an authorisation; and in relation to any other exercise of that power by virtue of that subsection this section shall have effect as if subsection (1)(a) required the notice to state that the Secretary of State is considering exercising the power by virtue of the said subsection (4) and as if subsections (2) and (3) were omitted'.

§ Mr. Baker
Amendment No. 13 is identical with one tabled by the Opposition in Committee, which we undertook to consider further. Having done so, we are satisfied that there is substance in the argument underlying the amendment.
Clause 13 was not included in the original text of Clause 12(4) as a power which could be exercised solely on the ground that the company had recently been authorised or brought under new control. The hon. Member for Glasgow, Craigton (Mr. Millan) will remember the interesting debate we had on this in Committee. This was because the power to restrict, that is to say ban, acceptance of new contracts, which is one of the most Draconian powers in the Bill, can at present be applied only to the whole of the company's insurance business and such a restriction would be prima facie irreconcilable with the issue of an authorisation or approval of a change of control.
The situation will, however, be altered by the Bill in that the power to restrict business will be applicable selectively to 387 a particular description within a class of insurance, for example, motor fleet policies or "Road Traffic Act only" policies. There may, therefore, be cases in which it makes sense to issue an authorisation for a class of business or approve a change of control subject to a restriction upon the undertaking of a particularly hazardous description or a type of business that is particularly risky.

§ Mr. Kenneth Baker
I beg to move Amendment No. 14, in page 14, line 22, at end insert: '(6) The Secretary of State shall, when exercising any power conferred by sections 13 to 21 below, i state the ground on which he is exercising it or, if he is exercising it by virtue of subsection (4) above, that he is so exercising it; but this subsection shall not apply where the Secretary of State has given notice under section 22 or 23 below of the proposed exercise of the power.'. The amendment follows the acceptance in principle in Committee of an amendment that originated from the hon. Member for Glasgow, Craigton (Mr. Millan). This shows how we are prepared to listen to argument if the argument is good.
The effect of the amendment is to require the Secretary of State to state the grounds on which he is exercising the powers in Clauses 13 to 21 which are the powers he can take if he is satisfied that the causes under Clause 12 can be established.
The reference to Clause 12(4) is based on the view that the circumstances to which that subsection refers—authorisation or change of control—are matters of fact rather than grounds in the sense of the term elsewhere in the clause. It is, therefore, necessary only to identify that subsection as the basis for action.
The reference to Clauses 22 and 25 make it clear that the requirements of the amendment do not duplicate themselves in other clauses.