§ 12.42 p.m.
§ Lord CarterMy Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Carter.)
On Question, Motion agreed to.
House in Committee accordingly.
§ [THE PRINCIPAL DEPUTY CHAIRMAN OF COMMITTEES in the Chair.]
§ Clause 1 [Community benefit societies: power to restrict use of assets]:
§ Lord Cartermoved Amendment No. 1:
Page 2, line 20. leave out 'him to perform" and insert "or assist him to perform any ofThe noble Lord said: In moving the amendment, I shall also speak to Amendments Nos. 2 and 3. This group of amendments and the amendment that follows are designed to meet some concerns expressed by the Delegated Powers and Regulatory Reform Committee. I express my thanks to Peter Hunt and the team of the Co-operative Party, Lucy Ryan and her team at the Treasury and particularly to Christine Salmon, the Clerk, and Alan Roberts, the special adviser to the Select Committee. They have all been extremely helpful in drafting the amendments.
The amendments deal with the first of three observations from the Select Committee on the drafting of the Bill. Members of the Committee may remember that paragraph 29 of the committee's 18th report stated:
The Committee considers that the delegation in clause 1 (5)(d) would be appropriate only if expressly limited in the bill to a specific purpose such as that described in the Treasury's memorandum".The object of the group of amendments is to meet that requirement. Amendment No. 1 is the paving for Amendment No. 2, which is the main amendment in the group, and Amendment No. 3 is consequential on Amendments Nos. 1 and 2. The new subsection (5)(d), as set out on the Marshalled List, meets the point made by the committee. The Treasury memorandum on the subject, addressed to the committee, states that the amendment narrows the scope of Clause 1(5)(d),
so that the regulations can only authorise a prescribed person to make binding rules for the purpose of enabling or assisting him to perform his functions under the regulations … Prior to full consultation it is not certain exactly what functions may be conferred on a prescribed person".The important point now is that any regulations conferring functions,can only make provision for the specific and limited purpose expressly set out in subsection (1): i.e. they can only set up an asset lock-in' regime for community benefit societies".It goes on to say that,
since the regulations are subject to the draft affirmative resolution procedure, they will require approval by a resolution in each House before they can be made. That will give both Houses the opportunity to prevent any regulations that confer functions on a prescribed person, or which authorise a prescribed person to make binding rules for the purpose of enabling or assisting him to perform those functions, which are considered inappropriate".I beg to move.
§ Baroness WilcoxMy noble friend Lord Skelmersdale, who regrets that he is unable to be here at this time, requested the noble Lord, Lord Carter, and the Government to take the report of the committee regarding the Bill on the chin. We are 502 delighted with the amendments proposed today by the noble Lord, Lord Carter, which, I understand, give effect to the committee's findings.
§ Lord NewbyWe on these Benches are pleased that an unexpected glitch at an earlier stage has now been resolved. We fully support the Bill and are pleased that the amendments deal with the earlier problem.
§ Lord McIntosh of HaringeyThe Government support the amendments.
§ Lord CarterThere is nothing else to say except that I do not exactly remember the phrase "on the chin".
On Question, amendment agreed to.
§ Lord Cartermoved Amendments Nos. 2 and 3:
Page 2, line 29, leave out paragraph (d) and insert—
- "( ) authorise a prescribed person to make rules, binding on persons of a prescribed description, for the purpose of enabling or assisting him to perform any of his functions under the regulations;
- ( ) make provision as to the making, publication and enforcement of such rules;"
Page 2, line 33, leave out "carrying out" and insert "performing
§ On Question, amendments agreed to.
§ Lord Cartermoved Amendment No. 4:
Page 2, line 38, at end insert—( ) Regulations under this section may not create any new criminal offence punishable with imprisonment for more than seven years.The noble Lord said: The amendment deals with the second matter raised by the Delegated Powers Committee. On the fact that no maximum penalty for criminal liability was expressed in the Bill, the report said:
In view of the range of provision which may be made under clause 1, the Committee considers that the delegation in clause 1(5)(a ) would be appropriate only if such a limit were included in the bill".That is exactly what the amendment does, although it is important to point out that it is not strictly necessary because there are precedents for a power to create criminal offences in secondary legislation that do not specify a limit. One precedent is the Industrial and Provident Societies Act 2002, passed only last year. However, in order to make clear beyond any doubt what should happen, I have tabled this amendment, which limits the maximum criminal penalty that can be prescribed in the regulations to seven years imprisonment. That might sound on the high side, but it is one of the most serious offences that can be created if an officer of a society were fraudulently to use the assets of a society,
for purposes not permitted by its asset lock (whether for personal gain or otherwise). Such an offence could potentially be as serious as theft of a charity's assets, or of money which has been collected for a charity and is to be regarded as belonging to the beneficiaries of the charity … The maximum sentence upon conviction for theft on indictment is seven years imprisonment",under the Theft Act 1968.503 The offences are comparable in seriousness to the potential offence that may be created in regulations made under Clause 1 if an officer of a society were fraudulently to use the assets of a society for purposes not permitted by the asset lock. If the offence were less serious, that would obviously be reflected in a lower penalty. The amendment represents an appropriate restraint on the delegated power to make regulations. I beg to move.
On Question, amendment agreed to.
Clause 1, as amended, agreed to.
Remaining clauses and schedule agreed to.
House resumed: Bill reported with amendments.