Compensation Bill [HL]

I am grateful to the noble Lord, Lord Hunt, for setting out so clearly his vision for the regulator, and I will study it with care. The noble Lord is right to observe that I am reticent to go into too much detail about the report because, as he has said, I want the Claims Standards Council to have an opportunity to reflect on it and, in fairness, to be able to make a full response. Suffice it to say that I think it is an impressive report and I shall put into the public domain as much as I can. My caveat is only that it has been written as a private report, so I must be careful to ensure that Mr Boleat in particular is comfortable with all that I make available. However, I am sure that noble Lords will find that it is as helpful and comprehensive as possible. In my response to the noble Lord, I want to say a few words about my approach. I agree that we must be clear that the model we choose works, not only for the present circumstances, but also for the future. We think that around 500 companies will be covered. While we do not know, we can speculate about what will happen once the regulatory body comes into effect and whether some companies will simply disappear. We have other experiences to draw on that will indicate what might happen in that regard. We know that the initial stages of the work of the regulator will be that of identification and authorisation, and thus will be different from its future work, which might be described as a watching brief. It may then undertake further work to identify areas across the sector that might need regulation. It will alert the Government to any specific problems it identifies. The body will need to be flexible and able to develop its skills appropriately. It will need to recognise changes and to be able to take both a short-term and a long-term view. I am therefore keen to look at the kind of model which will best deliver that, bearing in mind what we have already said about future legislation in legal services, which will have a direct bearing on this. I am also grateful to the noble Lord, Lord Hunt, for his comments about my noble and learned friend. One of the options available is for the Lord Chancellor himself to regulate, whether directly or through some other mechanism. He would take on the role but would then designate a suitable body to do the work. Those options, such as the equivalent of the FSA model—the noble Lord knows that the FSA does not wish to take on this work—or another body, perhaps the Claims Standards Council dependent upon its response to the report, and the Lord Chancellor are all options that are very much being borne in mind. I will consider these options fully, but my aspiration is that once the report is available and I have had further conversations with a number of organisations, and not least with my noble and learned friend, we will be able to have a fuller debate on how this issue is taken forward. By the Report stage, we should be in a position to indicate our proposals in this regard. Noble Lords will then know how we plan to approach this. That is as much as I feel able to say at this stage, but I hope that noble Lords are reassured that we are mindful of both the present and the future, and that we will ensure that we have a model which will deliver effectively. We have not closed off any options at this stage, but we are clear that by the Report stage we want to have moved on to a point at which the future direction of travel is clear. I could not consider accepting this amendment in any event because Amendment No. 51 will enable the Secretary of State to do what Amendment No. 36 asks for in terms of designating an individual. The preference of the noble Lord, Lord Hunt, is in any case for me to consider Amendment No. 51, which we discussed with an earlier group. However, that is a formality and I do not think the noble Lord is seeking to press this amendment, but to use it in order to discuss the issues.