Compensation Bill [HL]

moved Amendment No. 63:"Page 4, line 31, leave out subsections (3) to (5)." The noble Lord said: In moving Amendment No. 63, I shall speak also to Amendments Nos. 65, 98, 100 and 105A. This group of amendments is concerned with enforcement and prosecution. Amendments Nos. 98 and 100 were previously grouped separately. I have grouped them together because they have a good deal in common and I would be in considerable difficulty if they were not dealt with today. The next, and presumably final, day in Grand Committee is on Wednesday, when I will be heavily involved in dealing with the Terrorism Bill in the Chamber and we will have someone here with basically a watching brief. I am very concerned about the powers of the regulator to institute criminal proceedings and to conduct the entry and search of premises without outside authority. It is unusual for a regulator in any circumstances to be involved directly in criminal proceedings; that is especially so in the case of a small regulatory body—and this is plainly going to be small body. I forget exactly the number of firms currently involved, but the Minister told us the other day that it was something in the order of 30 or 40. So it is not going to be cost-effective for the regulator to set up his own criminal investigation and prosecution department. The powers that are involved here are intrusive. The right of entry and search is intrusive; it is something that the police themselves are not allowed to do without a warrant, in normal circumstances, and it should be left to the police or it should require some kind of warrant to be obtained from a holder of a judicial post, whether a judge or a magistrate, before the right of entry and search can be carried out. While it would be inappropriate for the regulator to exercise these powers without judicial backing, it would be many times more inappropriate if there were any possibility that the regulator would be a private sector body whose members were involved in claims management services and might therefore have an interest in removing competition, so could be regarded as a party with a personal interest in the matter. Amendment No. 63 would remove the power to investigate and institute criminal proceedings under Clause 6(3) to (5). It is virtually inconceivable—and it would certainly be a great waste of money—for the regulator to be equipped to do so by having the necessary legal support through its own legal department. Amendment No. 65 is more limited in its nature; it provides that if the criminal powers remained, the entry and search requirement should require leave to be given equivalent to that given before the police can execute a warrant. Amendment No. 105A provides that the regulator cannot exercise the powers under paragraph 15(1) to,"““require the provision of information or documents””," or to,"““enter and search premises””," without judicial authority. These are intrusive powers, and the power to obtain documents and search premises is plainly intrusive; but the power to obtain information to require people actually to make statements and give evidence themselves, even if it is restricted in cases in which they might incriminate themselves, is very seriously intrusive. Before exercising any of those powers, the regulator should obtain judicial authority. Amendments Nos. 98 and 100 cover what I believe to be defects in the procedure laid down in the Bill. Amendment No. 98 prevents the regulator from himself conducting a hearing, which would plainly be inappropriate. It is a basic rule nowadays—largely supported by the Human Rights Act 1998—that a person who carries out the investigation should not also hear the case. That is now a widely recognised principle. For example, in employment law, those members of staff of an employer who investigates an allegation of misconduct by an employee must not also be the people who decide whether the employee has been guilty of misconduct and whether that employee should be dismissed or subjected to some other penalty. Another problem is that the regulator will have his own view of what the regulations mean and what amounts to misconduct. It cannot be appropriate for someone in the position of the regulator to conduct a hearing and it would be at least a possible breach of Article 6 of the Human Rights Act. Frankly, it is an example of the curious way in which this Bill has been drafted. No doubt the people who drafted it were under great time pressure to come up with something, but some of the implications have not been looked into with as much care should have been the case. This is a small and not particularly controversial Bill. It is a busy department and I can quite understand why it was felt that not too much time should be spent on it, but it has been left with defects that need correction. Amendment No. 100 requires that there should be a right of appeal from a finding of any misconduct. It is essential that there should be an appeal from any tribunal that has the power to find someone guilty of what is described as professional misconduct. If it were a criminal prosecution there would inevitably be a right of appeal, but we are talking about a case where a regulator handles a hearing himself with a view to a finding of professional misconduct. Paragraph 8 of the schedule provides for an appeal from a refusal of application for authorisation, but there is no reference to an appeal from a finding of professional misconduct. That is a lacuna. There is plainly an obligation to provide for some kind of appeal in those circumstances as well. The enforcement and prosecution process suffers from a number of defects that need to be corrected—the powers of the regulator to institute proceedings, to conduct an entry and search of the premises, to require the giving of information in respect of a possible hearing by the regulator himself as opposed to somebody who is independent and impartial, and the absence of a right of appeal from a finding of professional misconduct in a hearing under the Bill. I hope that the Minister will say that some of these problems will be dealt with, not necessarily by my amendments, but the Government should look at them again before we return and come up with something to improve the Bill where it is defective. I beg to move.