PAYMENTS BY LICENCE HOLDERS RELATING TO NEW ARRANGEMENTS

HC Deb 27 July 2000 vol 354 cc1323-6

Lords amendment: No. 8, in page 5, line 21, leave out ("or") and insert ("and")

The Minister for Energy and Competitiveness in Europe (Mrs. Helen Liddell)

I beg to move, That this House agrees with the Lords in the said amendment.

Mr. Deputy Speaker

With this it will be convenient to discuss Lords amendments Nos. 9 to 11.

Mrs. Liddell

Amendments Nos. 8 to 11 relate to clause 8. This gives the authority powers to modify payment conditions in licences to reflect the establishment of the authority and the council. Amendments Nos. 8 and 9 make it clear that the authority can modify payment conditions to recover expenses incurred by the Secretary of State in establishing both the authority and the council, and that any preparatory costs incurred by the Secretary of State can be recovered.

Amendment No. 10 will facilitate the transition from the old to the new payment conditions by permitting the directors general, the Secretary of State, or both, to carry out the required consultation on the new conditions prior to the establishment of the authority. The new conditions can then be in place from the date that the new bodies are established.

Mr. Edward Leigh (Gainsborough)

While waiting for us to reach this group, I have been trying to understand what amendment No. 8 means. We are told that it relates to line 21 of page 5. Clause 8(3)(2) refers to the expenses of the Secretary of State in relation to the establishment of the Authority or the Council. The amendment replaces the word "or" with "and". I am not sure why the other place felt that that was necessary. Will the Minister explain that to me, please?

Mrs. Liddell

I think that the other place believed that it was a tidying up and a clarification. There has been lengthy debate in both Houses and this is an opportunity for us to ensure the clarity of the legislation wherever the two new authorities come into play. It is a common-sense provision. I do not feel particularly strongly about it, but it tidies up the legislation and makes it much more coherent. The hon. Gentleman will know that I am always willing to accept good suggestions.

Mr. Nick Gibb (Bognor Regis and Littlehampton)

I should like to help the Minister in answering my hon. Friend's question. This is one of many tidying-up and redrafting amendments. The Bill was incompetently drafted. The clause is an example of bad drafting. It is clear when one takes the word "and" out and puts "or" back in that the clause will not be satisfactory. There have been more than 600 Government amendments to the Bill. It is a classic example—it is just one of many—of a poorly drafted Bill being brought to the House in a rush. I am grateful to my hon. Friend the Member for Gainsborough (Mr. Leigh) for raising this issue.

Mrs. Liddell

I shall not get involved in questions of grammar with the hon. Gentleman. However, I merely point out that, when we started to consider the Bill, he said that he supported its broad thrust, but claimed that there would be 1,000 amendments. With the benefit of hindsight, we can say that it is not often that he is right—and he is wrong again.

Labour Members are anxious for the Bill to reach the statute book. It will ensure that consumers of energy get the full benefits to which they are entitled. It should lead to a reduction of 10 per cent, in wholesale electricity prices. I am not surprised that some Conservative Members wish to delay it.

Amendment No. 10 will facilitate the transition from the old to the new payment conditions by permitting the directors general and the Secretary of State—or both—to carry out consultation on the new conditions prior to the establishment of the authority. The new conditions can then be in place from the date that the new bodies are established

Amendment No. 11 deals with concerns expressed in Committee that the Secretary of State's powers in clause 8(8) to direct the inclusion of payment conditions were too widely drawn. The amendment ensures that the powers of direction can be used only in relation to the expenses of the council, and the expenses of the Secretary of State in relation to the establishment of the authority and the council.

Mr. Forth

As the House knows, this matter relates to payments by licence holders relating to new arrangements generally. It also refers to the arrangements that are to be made under the Bill whereby the authority can modify the condition of licences. More specifically, before modifying the conditions of a licence, the authority is required to consult the licence holders. These are important provisions, so it is important that we understand them properly.

I want to pause for a moment to consider amendment No. 10, which would insert the words: Any consultation undertaken by the Director General of Gas Supply, the Director General of Electricity Supply or the Secretary of State before the commencement of subsection (6)— the subsection that refers to the modification of the conditions of a licence and the requirement for consultation— shall be as effective for the purposes of that subsection as if undertaken by the Authority after that time. In effect, it says that if something happens before something, it will be as effective as if something had happened after something. I am slightly confused by that provision. I have no doubt that there is an elegant explanation for it and that the Minister will provide it shortly. However, for the time being, the meaning of it defeats me. I am not sure what the purpose of those words is and whether they will achieve it.

Like other hon. Members, I understand the point behind the original words in subsection (6), which states that, before the conditions of the licence are modified, the Authority shall consult the licence holder. It may be my fault for not spotting this point earlier, but it might not have been a bad idea for the obligation to consult to be somewhat wider. I can imagine circumstances in which the modifications of the conditions of one licence could—and almost certainly would—affect people other than the licence holder, especially if the conditions were eased or payments were reduced.

As my hon. Friend the Member for Bognor Regis and Littlehampton (Mr. Gibb) pointed out, more than 600 amendments have already been made to this rather imperfect Bill. I am not at all surprised by that, but I shall not dwell on the point—you would not want me to, Mr. Deputy Speaker—about whether the consultation should go wider. However, I want to dwell for a moment longer on amendment No. 10. We need much more clarity about the amendment's purpose in referring to consultation being as effective if it is undertaken before the commencement of subsection (6) as it would be if it were undertaken afterwards. We need to know why those words should be included and what they add to the Bill.

More pertinently, we should ask whether such wording risks confusing licence holders. Indeed, it may even confuse the authority and the director general more than it will help them. Before we agree to the amendment, we must be satisfied that it adds value and clarity. My fear—subject to the Minister explaining the amendment fully, as I am sure that she will—is that the amendment may serve to confuse, and not to clarify. The last thing that we want at this stage, and that the Government would want, is for words to be added to the Bill that would confuse people and undermine its purpose.

Mrs. Liddell

It is a pity that the right hon. Member for Bromley and Chislehurst (Mr. Forth) was unable to join us in Committee, where we had considerable discussion on these matters. If he had had the time to refer to the Official Report, he might not be questioning these issues. The measures concern the arrangements for the transition from having two authorities to having a single authority. They also aim to guarantee that there will be maximum consultation to ensure that everyone is content, and comfortable with the legislation.

A similar provision appears in the Deregulation and Contracting Out Act 1994. The right hon. Gentleman is probably more familiar with that than I am because it was introduced by the Administration of which he was a member. It is important that we have the correct transitional arrangements and, without this provision, we would find ourselves unable to consult until after the establishment of the authority and the council, which would mean that consultation would be curtailed and would cause delay.

Given that the right hon. Gentleman's colleagues in this House and the other place have welcomed the measures, I do not expect him to be too discommoded by the amendments.

Lords amendment agreed to [Special Entry].

Lords amendments Nos. 9 to 11 agreed to [Some with Special Entry].