My Lords, as always I am grateful to my noble friend Lord Hodgson for this probing amendment, which led to a very good debate. I will try to answer the questions raised, starting with the million-dollar question of what sort of person should be commissioner. I am not writing a job description this evening but I think we will look for someone with practical experience, perhaps in law or business, and with important skills including judgment, personal authority, the ability to influence effectively and to understand the intricacies of business relations and disputes, energy, and probably the charm—going back to the opening remarks—to get things done.
I will say a few things to my noble friend on Amendment 6 and the issue of an advisory panel to assist the commissioner. I agree that the commissioner will need to understand how supply chains work in different sectors and whether or not there are particular payment issues in certain regions—I will come on to that again later. In order to carry out the role we would also expect the commissioner to have regular contact with senior figures across industrial and business sectors and elsewhere. I have heard from the Australian Small Business Commissioner how important that has been to the success of his role.
However, having said that, the Government do not consider that providing for the establishment of an advisory panel in primary legislation is necessary or advisable. We would rather permit the commissioner to determine what advice he or she may need and what that means for his or her engagement with industry and the regions. As we have said several times this afternoon, the commissioner must be, and be seen to be, independent and should be mindful of this in engaging with industry. This would inevitably bring with it considerations and criticisms regarding the balance of membership of the body.
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We would expect the setting up of such a panel to be no small task. There would be questions of what sectors are to be included or excluded, what regional balance is necessary, how many small businesses versus how many medium and large businesses, and so on; that would cost money and divert attention from the prime task, which is focusing on improving late payment.
There are many existing bodies and arrangements that the commissioner may wish to work with, which could include the trade bodies, local strategic partnerships, growth hubs, the CMA or indeed any national or regional body that can advise on sectoral and industrial issues. It would seem more efficient to begin here rather than start with a new arrangement. The intention behind the amendment is understood, and of course nothing in the legislation would inhibit the commissioner from setting up a panel should he consider that appropriate.
Amendment 7 would amend Clause 3, which enables the commissioner to publish or give to small businesses general advice and information that would be helpful for small businesses’ dealings with larger businesses as supplier or customer, and in encouraging them to resolve or avoid disputes. The types of general advice and information regarding small businesses’ dealings with larger businesses that we envisage the commissioner will provide, principally via a web portal, are very important. They include the principles of agreeing contracts, general rights and obligations relevant to supply chain dealings as well as options available for resolving the dispute such as mediation. There are of course a wide range of options, as we will come on to discuss, from arbitration to ombudsmen, which we envisage the Small Business Commissioner signposting.
Clause 3 also provides for the commissioner to give information about and signpost to bodies including regulators, which can assist small businesses in their dealings with, for example, public authorities, which we have already discussed. I will give noble Lords an example. To illustrate, information and signposting to bodies that provide dispute resolution services could include the Groceries Code Adjudicator, which clearly provides overlapping advice, but not, for example, the Environment Agency, which is on the list, except in the narrow area where that would be relevant to his focus.
The Bill already provides that the commissioner’s advice and information function will cover information about a number of the regulators that are in scope where they could help a small business with its supply relationships; for example, in a dispute. I can say this
evening that this is obviously a very important part of the Small Business Commissioner’s work. I envisage a process of consultation on some of the signposting that is needed and so on, to make sure that that is useful. It is a two-stage process, involving setting up a signposting operation with a web portal so that people can find things that they need in relation to disputes in one place, and, one hopes, with links to other areas which are not so directly applicable. Then there is the complaints process, which we have focused on so far and which is the second stage.
My noble friend wishes to ensure that the commissioner works across all of the regions of the UK and understands the different issues at play across our great nation; I took that point. The annual reporting requirement, of course, provides transparency by ensuring that the commissioner gives a clear account of his or her work to the public and to Parliament. I agree that this should cover the work of the commissioner across all regions of the UK. However, within the parameters of the existing requirement to describe what has been done, the commissioner should be allowed the discretion to decide on the content and scope of the report, based on his or her activity during the period. This is the best approach: insisting that the commissioner visits or reports on their visits across the UK, rather than building on the Australian model and allowing the commissioner to consider what is appropriate and proportionate, could end up limiting, rather than optimising, their impact.