Regulatory Enforcement and Sanctions Bill [HL]

My Lords, I fully understand the enthusiasm of the noble Lord, Lord Jones of Birmingham, for reducing the burden of regulation on business. I do not want to address that; I want to look at it from the point of view of one of the sets of regulators, the local authorities. I speak as a member of the Office of Surveillance Commissioners who goes around inspecting regulators such as the local authorities under the Regulation of Investigatory Powers Act 2000. I suppose that I have talked about regulatory procedures with several hundred local authorities all over the country. I notice from the impact assessment that the Government have not been able to obtain much in the way of solid figures about benefits and disbenefits resulting from the Bill. I will therefore explore this in a little more detail. I take an example not, like the noble Baroness, Lady Wilcox, from Kensington, but from the Minister’s own area in the West Midlands, so I am sure that he will appreciate it all the more. It is, of course, like the example given by the noble Baroness, entirely mythical. A chain of pizza restaurants in the West Midlands has its headquarters in Dudley but an outlet in all the other boroughs. One day, customers at the restaurant in Walsall start falling ill with food poisoning. By this time, the Government have acted and brought in provisions under Part 3 to enable stop notices to be issued and the Local Better Regulation Office has arranged for Dudley to be the primary authority for the chain of restaurants. Before Walsall can do anything, it must look at the guidance about kitchen inspections that has been issued by Dudley and is seriously restricted in how often it can do inspections. This is not unusual; there is usually a local rule that local authorities impose on themselves about inspections because they appreciate that they do not need to be too heavy-handed about these things. Walsall’s hands are tied without the consent of Dudley. It would like to issue a stop notice but has no powers to do so without going to Dudley first. It must inform Dudley, which has five days to respond. Let us suppose that this happens three weeks tomorrow, on 21 December. As a result of the Bill, the five days do not include weekends, Christmas Day, New Year’s Day or any of the bank holidays, so the five days grows to 11 under these provisions. However, Dudley then agrees to the stop notice. Perhaps there will be a statutory instrument dealing with this sort of emergency. Of course, that is not in the Bill but only in some statutory instrument about which we know nothing. Walsall proceeds to serve the stop notice and tells the restaurant chain that it can appeal, which it does. This goes to a first-level tribunal, an organisation set up under an Act passed earlier this year, about which I think people know very little and I know nothing. At any rate, we do not know how long that tribunal will take to decide. In fact, it decides that the restaurant should be closed, as it is in, shall we say, February. At present, it could have been done on Saturday 22 December. At least, I think that that is the case, because when I look up the Food Safety Act I find that two pages of statutory instruments have been made under the section concerned and if one looks some of them up—I have not looked them all up—one sees that a lot of them suffer from the well known defect that they introduce European Union legislation not by stating the offence but merely by giving a cross-reference to paragraph 45 of the directive concerned, so nobody has any idea without looking at the directive what it is that one is not allowed to do. However, I think that the stop notice could have effect the following day. The next thing that happens is that the firm claims compensation under the Bill, as it can. It says that it was far too long after the event. However, we will need another statutory instrument before we know the bases on which compensation can be claimed. The firm’s compensation claim is refused and it appeals against the refusal, again to the first-level tribunal. Let us say that it loses again. What about the costs? Walsall can claim the costs up to the date when it went to the tribunal the first time, but not after that, unless the tribunal says so. I do not know whether the tribunal has powers to award costs; the Bill certainly does not say so. The Bill may reduce burdens on restaurant owners, but it does not look to me as though it reduces many burdens on members of the public who fall ill from eating food—not the meat in Essex used as an example by the noble Lord, Lord Razzall, but pizzas in the West Midlands—and it certainly does not reduce the burdens on the local authorities concerned. I wonder whether, with that sort of example, this legislation is producing the results that the Government wish to achieve. Another point arises out of the legislation that I helped to supervise. As the noble Lord said, civil sanctions are a very good idea. A lot of local authorities already use the enforcement concordat. It has a gradation of penalties and disciplines that they can impose if they find that there is something wrong in a regulatory context, and prosecution is usually the last resort. We now have a situation where the Government can not only introduce civil sanctions as a compulsory method of dealing with these cases, but say to local authorities that they must use one of them instead of a prosecution. This is a very serious situation for a most obscure reason. I am not sure what is going to happen about the list of regulatory duties that local authorities must set out under Clauses 61 and 62 and the sanction that they are going to have to use. To start with, I wonder whether central government are going to help local authorities to make a list of all the regulatory requirements that will have to be set out in this guidance. There are thousands of them and it will not be easy to make up a list, let alone decide the level of sanction that ought to be imposed. The real dilemma is that under this legislation the council’s officers can use any of the civil sanctions only if they are satisfied to the criminal standard of proof that there is a case to go ahead on that basis. To get that sort of satisfaction, it is necessary to carry out investigations, some of which may have to be covert. That is what the Regulation of Investigatory Powers Act is all about. The Home Office has now made it clear that authorisation to carry out covert surveillance can be given only in a case where it is desired to prevent or detect crime. The Government have ordained that this should not be crime; rather, the situation is to be dealt with by way of civil sanction. Can covert surveillance be used? I do not suppose that the noble Lord knows the answer; I certainly do not. This is not the first time; it has happened from the commencement of the 2000 Act in relation to misfeasance, malingering and moonlighting by employees of public authorities. No one has ever known until recently whether that was to be dealt with by disciplinary proceedings, as it usually is, or whether it was technically a crime—fraud, theft or something of that sort—and therefore susceptible to being dealt with by covert surveillance. The other day, the Investigatory Powers Tribunal, also set up under the 2000 Act, finally put that matter to rest. It said that activities of that sort by public employees are not susceptible to being dealt with under RIPA, as the Act is commonly known; they are outside its sphere and must be dealt with in common law. The Government will have to make up their mind about that. Either they must persuade the Home Office to extend the grounds on which covert surveillance can be used, in order to carry out the necessary investigations to implement the civil sanctions, or they will leave a large area of doubt. A substantial bureaucratic burden is being imposed on local authorities and their officers and a uniformity that may not suit the place that the local authority tries to organise and superintend. Insufficient notice has been taken of the views of local authorities or of the difficulties that they will face.