Environmental Civil Sanctions (England) Order 2010

I thank noble Lords who have spoken for their general welcome of these regulations. I shall try to answer the questions asked by the noble Lord, Lord Taylor, and will then deal with power of entry. The impact assessment covered England and Wales. The vision of the Government and the Welsh Assembly is for an enforcement system that is more proportionate, fairer and more effective across England and Wales. The Welsh Assembly Government are bringing forward similar legislation to allow the Environment Agency to use civil sanctions in Wales. The separate legislation is to allow more flexibility in the handling of the legislative process in Wales and any detailed amendments needed because Welsh regulation is slightly different. However, the impact assessment was for both. The noble Lord wants to understand the details of how fixed monetary penalties will be published and which part of the legislation provides for that. Regulators will follow the government guidance, which explains that they will be required to publish the details of any enforcement action taken using civil sanctions. The Government consider it good practice for a regulator to maintain a public register on a website of civil sanctioning decisions it has taken as well as of criminal convictions. When the register is developed, it will be important that it points out that criminal convictions are of greater seriousness than civil sanctions and that a VMP is of greater seriousness than other sanctions. The Environment Agency’s current consultation on implementing civil sanctions states that it considers, ""that publishing information on our enforcement activities raises awareness of the need to comply, and acts as a specific deterrent to the individual offender and as a general deterrent to others"." Article 14 of the draft order sets out the requirements that the regulator must follow when publishing details of any civil sanctions it has imposed. The noble Lord, Lord Taylor, asked whether, if the regulator decided to serve a VMP rather than to prosecute, an offender could get away with a £250,000 penalty for an offence that should have cost him more. In the most serious cases, regulators will still prosecute rather than apply civil sanctions. The Government hope that the courts will see the fact that they continue to prosecute such offences as a clear signal of the seriousness of the breach. Further, the Government are considering bringing forward further primary legislation to strengthen the hand of the courts in sentencing proportionately in such circumstances, particularly for requiring appropriate restoration. The £250,000 upper limit will not be a limit on the amount of restoration that an offender may need to undertake. The Government will carefully review the existence, level and effect of the £250,000 cap as part of their two-year review. The point raised by the noble Lord is not fully covered, but we intend to review the criminal law to bring the penalty even more into line and to keep going back to restoration and graduated, proportionate penalties. The noble Lord asked whether the Government had in mind a maximum limit for non-compliance penalties above which prosecution would be the preferred option. The Government do not have in mind any financial threshold above which prosecution would become appropriate. The regulator will make a decision on whether prosecution is appropriate on a range of factors of the kind set out in section 3 of the Government’s guidance, including whether prosecution would be the route most likely to change behaviour. I have looked at the regulation; it is a complex matrix of proportionality and use of prosecution to signal the seriousness of behaviour. It is designed to change behaviour so that compliance is the norm. I was asked what would happen to the financial penalties levied by the regulator. The Government require all financial penalties recovered by regulators to be passed to the Consolidated Fund. Therefore, there is no financial incentive for regulators to levy penalties. However, regulators may recover their reasonable investigation costs from offenders in civil sanctions just as they currently can when they prosecute in the criminal courts. To do so, they will need to serve an enforcement cost recovery notice and may be required to provide a detailed breakdown of the cost to the recipient of such notices. Further, where they seek to recover their costs, any financial penalty payable is reduced by that amount. Finally, offenders may also pay money to make amends to third parties adversely affected by the offence and/or pay for restoration of the environment. Once again, such amounts reduce the financial penalty. The noble Lord asked whether there was any government guidance to ensure that farmers are not unduly penalised due to their error already having becoming serious by the time their error is measured. Regulators imposing a variable monetary penalty will ensure that the penalty is proportionate to the circumstances of the case. However, they will also take into account a farmer’s ability to pay or carry out restoration work in determining the penalty to be paid. In cases of potential or real hardship, the regulator may consider delaying collection of a penalty until the farmer’s ability to pay, and the relationship with any reduction under the cross-compliance scheme, is understood. The noble Lord wanted to know what the eight "N/A"s mean. I am not sure that I have all eight answers, but I shall do my best. In each case where "N/A" is used in the analysis of the evidence base, it means "not applicable" Here, we are the prisoners of—I know from years on the Merits Committee—the introduction of a pro forma, which calls for the filling in of a box. Sometimes N/A is the right answer. In each case where it appears in the analysis and evidence-base, N/A means "not applicable". Annual costs per organisation is not applicable for any micro, small, medium or large organisation because these proposals do not introduce annual costs for an organisation in the sense of standing, ongoing costs. Costs depend on an organisation’s non-compliance. As to whether any of these organisations are exempt, the impact assessment template is concerned only with whether there are exemptions for micro and small businesses. Therefore, the words "not applicable" are automatically inserted for medium and large businesses. The question of whether implementing will go beyond minimum EU requirements is relevant to where a piece of legislation transposes EU law. This legislation is entirely domestic, so the question is not therefore applicable. The noble Lord asked whether this legislation was being equally applied to small businesses as to big businesses and, if so, how the two were being differentiated. The enforcement provisions will apply to any business, whether small or large. We are back to our pro forma. I understand that this section of the EM has to be written with those opening words. The regulator’s enforcement decisions will have regard to factors such as the seriousness of the non-compliance and the attitude and approach of the business concerned. As I mentioned earlier, the regulator will take the business’s ability to pay into account. The noble Lord also wanted to know how many first-tier tribunals there will be and what would be the maximum distance. The Tribunals Service will ensure that the first-tier tribunal hearings take place in locations around the country that will be convenient for the parties concerned. This is a new area of activity, but I understand that the Tribunals Service has indicated that it will have that flexibility to move about in order to make it easier for people. I spent some considerable time asking the team questions about power of entry, so now forgive me for the rather long answer that it has produced for me. The power is proportionate and necessary to allow Natural England to observe whether various civil sanctions are being complied with—for example, measures to restore harm, prevent further harm or to comply with the law. It achieves the necessary balance between sufficient powers to enforce and adequate protection to individuals. The power has been approved by the Home Office. The power is qualified: it may be used only at a reasonable time and no force may be exercised to gain entry. Proof of authorisation shall be produced if required. The power may not be used to enter a part of someone’s premises that is used exclusively for domestic purposes, thus preserving the right to respectful privacy and liberty in the home. Nor does it allow seizure of any information or material, for example. Furthermore, the extent of the power is substantially similar to the powers conferred upon the authorised officers of the Environment Agency by virtue of Section 108 of the Environment Act 1995. It would not make sense for the Environment Agency to be able to enter premises for this purpose, but for Natural England not to have a similar power in relation to the offences enforced by it. If entry is refused, it is envisaged that further regulatory advice and guidance will ensue. If this proves to be unsuccessful and the regulator is satisfied that non-compliance persists, in certain circumstances it would be open to the regulator to impose a monetary non-compliance penalty. Alternatively, where no variable monetary penalty has been imposed in respect of the conduct giving rise to the offence, the regulator may bring criminal proceedings. It would normally be in the interests of a business to demonstrate to the regulator that it has complied with the civil sanction. If it chooses not to do so, the regulator may consider alternative action in relation to the offence in question or may review how the business is dealt with in the future. It will come out in the guidance. Previous performance of a business can be taken into account in sanctions in subsequent events. The Government will monitor this issue and it will be subject to review two years after introduction. Finally, I thank noble Lords for their support. What is fascinating about being a government Whip is that you regularly do things that you know absolutely nothing about. I did not know anything about this area a week ago, but I have throughout my professional career been involved with regulation and compliance. This is a really good example of government, by which I mean little "g" government and the people behind me, flogging through areas that need protection—in this case the environment—and looking at how to get compliance. To get that, you have to have regulation and you have to be able to apply it. This is all built around encouraging compliance, putting restoration first and, in a sense, penalties last. This is a great step forward in this sort of regulation. Motion agreed.