Legal Services Bill [HL]

moved Amendment No. 47: 47: Clause 30, page 15, line 3, leave out ““one or more of”” The noble Lord said: In moving AmendmentNo. 47, I shall speak to Amendments Nos. 48, 50, 51, 54, 55, 59, 60, 67, 68, 76 and 77. The amendments would ensure that the various powers of intervention of the Legal Services Board in the regulatory work of approved regulators are triggered only by an adverse impact on the regulatory objectives as a whole. Under the Bill, the board’s disciplinary measures could be enforced on the basis of an adverse impact on only one of the regulatory objectives. The Joint Committee agreed that it was important for the Legal Services Board to have these formal powers and that it should have several effective measures at its disposal to exercise them. However, it also regarded it as essential that these powers are used only when necessary, when the approved regulators are clearly failing, and that in normal circumstances there would be no threat of an over-intrusive board micromanaging the approved regulators. The amendments are consistent both with the Government’s response to the Joint Committee that the Legal Services Board should act only where there is clear evidence of failure on the part of an approved regulator, and with the policy that the lead responsibility should rest with the approved regulator—themes which have already been rehearsed in debates on several amendments this afternoon and earlier this evening. The committee advised that differences should be resolved by agreement in as many cases as possible by making the threshold for intervention by the Legal Services Board higher than it is in the Bill. It is hoped that the amendments would lead to agreement in more instances than otherwise, and would discourage the board from acting in an excessively heavy-handed manner. The reference point for the failure of an approved regulator will obviously now be the regulatory objectives established in the Bill. The inevitable difficulty is that the objectives themselves will often conflict. Training prior to qualification may have an adverse impact, for example, on competition in legal services, while its absence might have an adverse impact on consumer interests. The regulatory objectives should be taken as a whole. Almost any exercise of its functions by an approved regulator will lead to some adverse impact on at least one of the regulatory objectives. If the threshold for intervention were too low, the Legal Services Board would become a front-line regulator flying in the face of its supervisory role. The potential for constant interference by the board would go completely against the Clementi vision of the LSB as a small oversight body. If the LSB is allowed to depart from its supervisory role—and it is to the Act that it will refer, not any Joint Committee recommendation or government response—it will also drive up costs. The board must be allowed to take a balancing approach before intervening against the approved regulators by assessing whether the act or omission has had a detrimental effect on the regulatory objectives as a whole. The amendment does not impose an artificial threshold by specifying the number of objectives that must be affected before the board can act. It would still be open to the Legal Services Board to punish an approved regulator for breaching only one of the regulatory objectives, as long as that was sufficiently serious to have an adverse impact on the objectives taken together. These amendments would ensure that the board does not look at each objective in isolation but considers the wider and effective application of the objectives laid out in Clause 1, which we are sure the Government would like to see. I beg to move.