My Lords, I am grateful to the noble Lord and will now respond to Amendments 11, 12 and 34, which, between them, would amend and extend the commissioner’s functions. As I have already set out, the Government consider their proposals for the commissioner’s functions proportionate in addressing the payment issues facing small businesses, especially when combined with the new reporting requirements. They balance the disincentives to encourage larger businesses to behave reasonably towards smaller suppliers with support for smaller businesses so that they become more savvy contractors—taking the heat out of difficult issues, as the noble Lord, Lord Mendelsohn, said.
The proposals have been arrived at following consultation over the summer which—partly to my surprise—showed a need for better navigation of dispute resolution services rather than direct provision. Responses to the consultation and subsequent stakeholder engagement showed broad support for the Government’s approach to meeting these needs.
Amendment 11 would amend Clause 3, which relates to the provision of general advice and information. The Government intend the Small Business Commissioner to help build the confidence and capabilities of small businesses in managing their commercial dealings—for example, enabling them to assert themselves in contractual disputes and negotiate more effectively.
Under Clause 3, the commissioner may publish, or give to small businesses, general advice or information that would be helpful for them in dealings as a supplier or customer, and in encouraging them to resolve or avoid disputes—for example, information about agreeing contracts, supply chain dealings and options for resolving disputes. It also allows that general advice and information to be provided in different ways. It might be provided by the commissioner or his or her staff, or via others—for example, via a government department or a representative or professional body—but in all instances, the commissioner has a key role in determining what advice or information is delivered, including approving content, which we intend will be delivered primarily via a web portal.
Clause 3(8) enables the commissioner to make recommendations to the Secretary of State about the provision of general advice and information to small businesses by the Secretary of State, and subsection (9) requires the Secretary of State to inform the commissioner of what, if anything, is to be done in response to the recommendation. I am not sure that we have discussed that before.
I do not believe that Amendment 11 is needed. The power in subsection (8) to which the noble Lord’s amendment applies is additional to the commissioner’s own powers to make that information available to small businesses, which are set out separately in Clause 3(1).
Turning to Amendment 12, I know that the noble Lord is concerned about the inability of the commissioner to directly provide dispute resolution services, such as
mediation, and is calling on us to extend his role. This was one of the questions on which we consulted. Indeed, as noble Lords will be aware, initially we were thinking of creating a small business conciliation service. But our consultation and our engagement with stakeholders over the summer showed that there was little appetite for government to step into the dispute resolution market. There was broad and clear agreement among business stakeholders that the problem is not a lack of dispute resolution services. There are plenty of avenues for business to mediate or resolve a dispute outside of court action. There are various regulators and ombudsmen, including for example, those that cover utilities. There are numerous adjudicator schemes, including public sector schemes that I talked about earlier, and there is a large private sector, complete with relevant professional bodies, such as the Civil Mediation Council and the Chartered Institute of Arbitrators doing good work.
Instead stakeholders, including the Federation of Small Businesses, the CBI and IPSE, which importantly represent freelancers and the self-employed, have told us that there are gaps in the information available and that small businesses need support to navigate it more easily. The Small Business Commissioner will fill this gap.
Amendment 34 would provide the commissioner with the power to facilitate group litigation or representative action by small businesses with similar complaints. The commissioner will work to raise awareness among small businesses of alternative dispute procedures and where they can seek support when they have issues or disputes with other businesses—spreading the word. The aim is to encourage a change in how businesses deal with each other—a long-lasting culture change to promote fair treatment for all, especially in relation to payment practices. The commissioner will advise small businesses about their rights and options which in some circumstances could include litigation. However, it is essential that the commissioner is impartial. The impartiality of the commissioner is where we came in today, and it has to apply when he or she is dealing with complaints. He or she must be perceived by business to act impartially in any dispute that he or she deals with. It would therefore be inappropriate for him or her to take a more direct role in facilitating group litigation or representative action.