Public Trustee and Administration of Funds Bill [H.L.] (Hansard, 8 May 1986)

§ The Lord Chancellor (Lord Hailsham of Saint Marylebone)
My Lords, I beg to move that this Bill be now read a second time.
Primarily this is an extremely technical measure. It relates to the organisation of the administrative work involved in the management within the Lord Chancellor's Department of privately owned assets such as trusts, funds paid into court, and the assets and affairs of mental patients. Although it is technical the Bill will enable the administration of the assets I have described to be carried out more efficiently and effectively. At present such assets are managed and investment decisions made in different places and in different ways. The Public Trustee, as his name implies, deals with trusts, the Court of Protection manages the funds of mental patients, the accountant general, who is presently the official head of the Lord Chancellor's Department, manages funds in court and the Official Solicitor manages some judicial trusts.
In 1982 a review of the Public Trustee Office concluded that the continuing decline in the popularity of trusts would eventually make it difficult to justify the separate existence of the Public Trustee Office, and that in due course it should be merged with another part of the Lord Chancellor's Department, possibly that of the Official Solicitor. Further examination by the department in 1983 and 1984 led to the conclusion that there was no strong case for a general merger of the offices of Public Trustee and Official Solicitor, whose range of tasks are in general very different—the Public Trustee, in effect, being a trustee, and the Official Solicitor looking after people in contempt of court, young children and so on—but that there would be good grounds for bringing together, as far as possible, all the Lord Chancellor's administrative work on the management of privately owned assets: that is, the Public Trustee Office; the trust section of the Official Solicitor's Department; the administrative (but not the judicial) divisions of the Court of Protection; and the Court Funds Office; that is, the department of the Accountant General of the Supreme Court. The thinking behind that, which I announced to your Lordships' House on 20th May last (nearly one year ago) is that it would allow concentration of expert skills, produce savings of staff and cost and, one hopes, lead to a better service for the owners of the assets in question.
At the same time as the internal departmental examination, a Cabinet Office Efficiency Unit scrutiny was looking at the specific question of investment activity within the Lord Chancellor's Department in 831 relation to privately-owned assets. That scrutiny made a number of recommendations. One was the proposal that while the judiciary should set investment objectives for individual funds in court (that is, for example, to determine whether capital growth of a high level of income was the requisite in any given particular case) it was more properly a specialised task to decide how those objectives should be met; whether through unit trusts, fixed interest investments or by other means.
The Bill before your Lordships will provide the necessary legislative foundation for those reforms. Accordingly, it contains the following main elements. Clause 1 allows the offices of Accountant General of the Supreme Court and Public Trustee to be held by a single person and enables the post of accountant general to be held by an official other than the permanent head of the Lord Chancellor's Department. That will permit funds in court and trust work to be brought together under the same person and pave the way for rationalisation of practice and procedure.
Your Lordships may remember the strange origin of the office of accountant general. It was established in somewhat unusual circumstances. One of my predecessors was Lord Chancellor in the reign of George I and made a fortune by selling the judicial posts of Masters in Chancery to the highest bidder—not a course that is at present open to me. When some of those masters ran off with funds deposited in court, the whole sorry story emerged and the holder of my office was tried in this House by his peers and ended up in the Tower until a fine of £30,000 had been paid. The result was that the office of accountant general was then established to safeguard the interest of depositors. He has been carrying out his duty successfully for the past 250 years.
Clauses 2 and 3 extend the reform proposed in Clause 1. They enable the Public Trustee to take on tasks on behalf of the Court of Protection, both under the Mental Health Act 1983 in relation to managing the affairs of patients and under other legislation conferring powers on that court. Clauses 1 to 3, taken together, will allow adminstrative work on private assets to be centralised in a single office. Clause 4 embodies the recommendation made by the efficiency unit scrutiny that decisions on investments should be the province of specialised administrators and not the courts. Accordingly, this clause removes the power of the courts to specify investment media to the accountant general, though of course it does not remove their power to set the general investment policy.
Clause 5 rectifies a minor accounting anomaly in the existing legislation relating to funds in court. It permits the national debt commissioners to recover their expenses (currently some £30,000 a year) in providing the accountant general with an investment service for funds in court.
I hope that I have sufficiently explained the policy underlying the Bill before the House. If enacted, over the next two years I hope to proceed to rationalise the administrative work on private assets in a single office, to be called the Public Trust Office, which will have at its head a single official with the title of Public Trustee 832 and Accountant General. I hope that that organisation will be able to take on some of the work currently handled by the official solicitor, although of course the official solicitor will retain his other duties and will himself remain outside the structure proposed.
The Court of Protection will also of course remain a separate entity, comprising only a judicial division. Administrative work on behalf of the court will be handled by the Public Trust Office. In the meantime, I have been moving towards a closer association of the various offices dealing with private assets, and the benefits in terms of shared experience and manpower savings are, I am told, already becoming evident.
I have no doubt that the further changes to which the Bill will pave the way will produce additional benefits; and I therefore commend the Bill to your Lordships' House. I beg to move.

§ Lord Elwyn-Jones
My Lords, the House will be grateful to the noble and learned Lord the Lord Chancellor for guiding us through this highly technical Bill and for disclosing at least one skeleton in the cupboard of Lord Chancellors. I know that three of the noble and learned Lord's predecessors were saints; some, apparently, were not.
This is an important Bill affecting those whose affairs need the protection of the courts in various ways. It is clearly sensible to bring together as far as possible within the Lord Chancellor's Department all the administrative work on the management of privately-owned assets. The proposed creation of the new Public Trustee Office with a single official having the impressive twin title of Accountant General of the Surpreme Court and Public Trustee will be an important step in our public administration. I think that the response to the Bill generally has been one of approval.
I note the cautious provision in Clause 1(1) that: The office of Public Trustee and the Office of Accountant General of the Surpreme Court may be held by one person. What is the reason for that coyness? The burden already placed upon the permanent secretary of the noble and learned Lord's department is, I know, a very heavy one, which has increased greatly with the growth of responsibility for the administration of the courts. Would it be right to suggest that he is a kind of watchdog for the noble and learned Lord? Why the coyness? Perhaps we can be told.
I understand that the proposal in Clause 4 with regard to the review of private assets activity in the Lord Chancellor's Department is the product of recommendations of the Cabinet Office Efficiency Unit. I think it is time that we learned a little more about that unit. What is the extent of its terms of reference? Is it now undertaking a general review of the administration of the courts? Is it a new Beeching that looms on the horizon? Has it, for instance, been responsible for the recent review of the administration of legal aid? Where does its remit begin and where, pray, does its remit end? What is its power within the Cabinet Office? Who are these experts who are to roam 833 far and wide over the field of public administration? It may be that I have missed proper publicity of that development. It is an interesting point. I wonder whether the noble and learned Lord will lift the veil so that we may be happier that men of total reliability, competence and skill have this great task of improving the efficiency of various aspects of government.
I have little doubt that when we come to the examination of this Bill in Committee light will be thrown on what is at present a remarkably uncommunicative Bill. It is all a series of administration, of legislation by reference. Had the noble and learned Lord, Lord Renton, been here, I am sure we would have had a learned discourse from him upon the obscurity of gobbledygook which is involved in reference—purely by reference—to other statutory provisions unexplained and undescribed. However, that may sound a somewhat ungenerous reaction to what is commonly thought to be a useful improvement. But I hope we may have some answers to one or two of the questions which I have put.

§ The Lord Chancellor
My Lords, I note the chorus of approval which has greeted my Second Reading speech, and I am grateful to the noble and learned Lord for his kind words. He asked me two questions, one which I can answer and one which I do not think I can very well. In reply to the first (which I can answer) I would say that "may" often means "will" in statutes. At the moment the Accountant General cannot be anybody other than the permanent head of the Lord Chancellor's Department. There is a section in some Act which says so. The object of this Bill as regards that is that he shall be joined with the Public Trustee, which would not otherwise be possible unless the permanent head of my department became the Public Trustee, which the noble and learned Lord would consider almost unthinkable. I may be going to receive enlightenment on this.
The second question which I was asked is about the Efficiency Unit scrutiny. This is one of the things which some of us find useful. It is not in my department and so I cannot very greatly enlighten the noble and learned Lord, though if he puts down a detailed Question—I am sure there is no secrecy attached to this—he will find that it is composed entirely of the great and the good. It was established by the Government to be available to Ministers in charge of departments, to apply the rigours of Rayner-type scrutinies in a drive to improve efficiency, with a scrutiny of the administration of legal aid in the Lord Chancellor's Department.
However, so far as this Bill is concerned, I am not sure whether I called them in or whether they asked me to submit to a scrutiny. I have myself long harboured the idea that if we were going to look after other people's money, we had better look after it under one hat and not under four hats. I am sure that this will turn out to be a good thing, and this is what the Bill is really about. It could not have been done without primary legislation, like a good many other desirable objectives. I was very grateful to the Efficiency Unit for the help they gave me in thinking out this wonderful idea which I myself had had for a long time, so that we worked in perfect harmony with one another.
834 An efficiency scrutiny is being carried out by the same body in relation to legal aid, but who am I, who pride myself on the great efficiency of the Lord Chancellor's office, to refuse to have it looked at by someone else to see how marvellous it is? It has excited a certain amount of suspicious interest from other quarters, but I do not know whether the Second Reading of this Bill is really the arena in which I should develop the theme at any great length. I have had 40 or 50 letters from various Members of another place and I have written answers of great length and always more or less in the same terms.
If the noble and learned Lord wants more information, I shall be happy to give it to him. No conclusions have yet been arrived at and so I cannot really tell him what will happen. I expect that it will be found that we are running the scheme fairly well, and that will give me nothing but pleasure, as I am sure it will give the noble and learned Lord, since I am running the department in much the same way as he did.

§ Lord Willis
My Lords, before the noble and learned Lord sits down, may I ask him to enlighten me? I have been puzzled twice this week in connection with the two little words "may" and "will". To a simple wordsmith like myself the word "may" means that you have the right to do something, but that you have a choice in the matter. The word "will" means that you will actually do something, that you have no choice.
The noble and learned Lord has said today that sometimes the word "may" is interpreted in law as "will". I heard this earlier this week, on Tuesday, too I am puzzled by it; it may be irrelevant to this particular debate, but I should be interested to hear the noble and learned Lord's comment.

§ The Lord Chancellor
My Lords, this is in a sense a Committee point, and I must have heard it debated about 20 or 30 times since 1938 when I first entered one or other of these Chambers. The fact is that the word "may" confers a power on somebody. Circumstances may exist, and the noble Lord will note the use of the auxiliary verb in this case in which the person who has the power to do something has a duty to exercise the power, but not in every case.
I agree that in the case of the Accountant General and the Public Trustee the choices are limited. Either the offices are held by one person or they are not. My intention is that the offices should be held by one person, when it is lawful for them to be so held, which is not until the Bill becomes law. But I suppose that some later Lord Chancellor who may be either a saint or, like me, a sinner, may take another view. However, my intention is that they should be held by one person, and the object of the Bill is to give me the power to see that that is done.