Parliamentary Standards Bill

I say at the outset that I hope what I say in response to noble Lords opposite will answer their questions and assuage their concerns. I do not propose to come back to this issue on Report. I would like to clarify the situation regarding sunset clauses today. We have an awful lot of things to come back to on Report, and this issue is relatively clear. The government amendments provide for a review mechanism for the clauses that deal with the independent commissioner and the sanctions regime, including offences, and for the provisions on the code of conduct on financial interests. The amendment from the noble Lords, Lord Shutt of Greetland, Lord Tyler and Lord Strathclyde, would apply a sunset clause to the provisions of the Bill that deal with the powers and functions of IPSA in relation to the code on financial interests and of the commissioner in relation to investigations, as well as offences. It would leave the regime with no means of dealing with any breaches of the rules on allowances, and would leave the commissioner with no powers and functions at all, although it would continue his existence. We recognise that there has been considerable pressure in the House to introduce a sunset clause for the Bill, not least on the grounds that it has been passed under emergency or expedited procedures. I, too, have carefully read the excellent report from the Constitution Committee. Emergency legislation takes many forms. Sometimes it is to deal with a situation that will resolve itself very quickly. Sometimes there is a suitable legislative vehicle into which a revised proposal can be inserted with the normal timescale for parliamentary debate. This Bill, however, falls into neither of those categories. There is an urgent need to act—that is why, with the co-operation of the leaders of the other parties, we have sought to get the legislation passed before we rise for the summer. The mischief that the Bill is intended to address is a continuing one. We need to restore the people’s trust in Parliament, particularly in the way in which MPs’ financial interests and allowances claims are dealt with. The Government simply do not accept that the people will be satisfied with a provision that implies that in two years’ time we could abandon the whole process and revert to the old ways. Nor do I believe that the parties opposite really think that either, but is it realistic to suppose that, near the beginning of a new Parliament, any Government would want to have to find time to re-enact this Bill or the bits of it that deal with the code on financial interests and the investigations regime? I think not. We have heard a lot in debates on the Bill about the "chilling effect" of certain propositions. I suggest that the noble Lords’ sunset clause would itself have a chilling effect on the new IPSA. It is important that the members of the new body should be distinguished and authoritative people. The Bill says that they should be appointed for five years. The opposition amendment would leave IPSA and the commissioner in existence but shorn of many of their functions. Where would be the incentive for good people to put themselves forward for these positions in these circumstances? I recognise that the Conservative Opposition have moved considerably from their position in the other place, where they were proposing that the whole Bill should be sunsetted within one year of it being passed. They have now moved to supporting the proposition that the parts of the Bill that do not deal with the allowances scheme should be sunsetted after two years. I am grateful for their flexibility on that, but what they are proposing would still have an impact on the quality of IPSA. It might not throw the staff of IPSA into the sort of uncertainty that their previous proposal would have done, but it still raises questions about the position of IPSA and, even more, of the commissioner. The institution of the commissioner would continue to exist under the proposed amendment, but he would have no powers or functions at all unless the Act were to be renewed. Who good would wish to apply for the position in those circumstances? Nevertheless, the Government understand the concern that to some extent we are moving into uncharted waters with this Bill. We have therefore tabled these amendments to provide an opportunity for Parliament to reconsider whether the legislation is working as intended, but without requiring its complete re-enactment to continue its existence. We are clear that IPSA must continue to exist, and that we must be able to offer certainty to those whom we want to work in it. It is essential that we have an independent body outside the House setting a transparent allowances regime. That much is common ground. Noble Lords will know that we had great doubts about the wisdom of applying the sunset provision to Clause 5, but we have decided to do so, given the strength of feeling in this House that we should. However, in contrast to the noble Lords’ amendment, we do not see any point in continuing the existence of the commissioner if he or she is to be shorn of all functions. That is why our amendment also refers to Clause 1(3) and Schedule 2. There are two differences between our amendment and that of the noble Lords. The first, and perhaps the minor one, is that our timescale runs from commencement and not from Royal Assent. The purpose of a sunset clause is to evaluate the effectiveness of the provisions in practice. It will inevitably take some time to appoint members of the authority and the commissioner, and further time to allow the authority to consult fully and create the allowances scheme and code of financial conduct. If the two-year period ran from Royal Assent, which we hope will be next week, that would involve a period of many months when the timescale was running out but none of the functions to be reviewed were in existence. We therefore think that it is more logical for the egg-timer to be started when IPSA is actually brought into existence. Our major difference with the noble Lords is over the way that they approach sunsetting. In a way, it is a question of the definition of "sunsetting". Instead of providing for the relevant portions of the Act to expire after two years, whatever happens, the amendment would provide for the relevant portions of the Act to expire unless they were continued by resolution of both Houses. The relevant portions of the Act could be extended for two years at a time by order approved by a resolution of both Houses of Parliament. Such a sunset clause, as the noble Lord, Lord Tyler, pointed out, would be similar to provisions in the Prevention of Terrorism Act 2005 whereby the powers in that Act relating to control orders may be continued by the affirmative procedure for set periods. That is the critical difference between the two approaches. Both give Parliament the opportunity to consider whether or not it wishes to continue with the investigations regime set up under the Act, but, in the case of the government amendment, if Parliament decides that it wants to continue the regime, it may simply vote to do so. Neither the Government nor Parliament would need to find the time for primary legislation needed to re-enact the Bill. Also, if all the provisions of the Act were working very well, why would Parliament want to take an inordinate amount of time in re-enacting the Bill? That may not be the best way forward. I suggest that the proposal put forward by the Government provides a much more satisfactory outcome, both for Parliament and for the public, who can be assured that the new regime can be continued. It is the best outcome for members of IPSA and the commissioner himself, all of whom deserve some security.