Regulatory Enforcement and Sanctions Bill [HL]

I was much reassured by what the noble Lord, Lord Jones, said about this clause and the issues behind it. He placed great emphasis on what I might call the protection of businesses against arbitrary inspection by a town hall on spurious grounds. He ended, quite properly, on the subject of spurious grounds. That attitude may help to explain why he is not a member of the Labour Party, although he is a member of the Government—a point referred to earlier. However, I shall not press him on what he obviously regards as a very personal matter, judging by his response this afternoon. I gave notice of my intention to oppose Clause 28 because I think that it could lead to a different set of difficulties. As has been made clear, its purpose is to ensure that inspection of different branches of the same business is conducted on the same basis. That will be very good for the business. That is the purpose of this whole part of the Bill, which concerns inspection. However, in future, when this is all up and running, inspection will vary not between the different branches of the same business but between adjacent shops along the high street. More so nowadays than perhaps used to be the case, on the average high street quite a proportion will be the branches of multiple shops. Interspersed with them will be independent stores and local businesses with perhaps only one or two outlets, and other concerns such as education providers like McDonald’s, a company which now seems to have moved into that field. However, I am referring to franchisees. We had a little difficulty over franchisees the other day because it appears that they will be half involved in this and half not, depending on the detail of their business arrangements. I do not want to get involved in all that again. Outlets belonging to the multiple chains will each be part of an inspection plan agreed with a local authority, and most probably a different one for each. Some local authorities may become primary authorities for large numbers of retail outlets, but others will only be the primary authority for an outlet where the headquarters of a concern happens to be located in its area. Many inspection plans will be agreed with different local authorities for the multiple shops; there will be partial inspection plans for the franchisees and the local authority—the secondary authority—will only be in complete charge of individual shops which do not have the advantage of an inspection plan. So the patchwork will be spread along the high street instead of across the branches of a large company. I am concerned about how to protect smaller businesses within a single authority that are not grand enough to have an inspection plan. Such businesses might cut across several local authorities but would still not be of sufficient size to warrant a plan. How are they to be protected from the arbitrary power against which the noble Lord, Lord Jones, is going to protect those involved in inspection plans? It may be that an awkward local authority inspector will have to concentrate his efforts on small businesses, which worries me. Certain other aspects of drawing up the inspection plans worry me because of my original qualification as a chartered accountant. I still am a chartered accountant, but now a rusty one because it is a long time since I was last actively involved in the profession. However, I started my professional life as an auditor. The idea that one’s audit plan is drawn up in consultation with the person being audited is not one that springs to mind. Of course you must talk to the person you are auditing, but the plan is the auditor’s plan or the inspector’s plan, and it must be followed. You need a measure of co-operation, but authority over how the plan is drawn up must not be given away. Given that, the extent of the consultation provided for in subsection (4) also worries me slightly. Subsection (6) provides that the other local authorities which will make the inspections will only be told about it after it has all been agreed. Only after it has been signed up to by the primary authority, the LBRO and the company being inspected will the people actually doing the inspections be told. Here we go back to the difficulty that if all the secondary authorities have to be consulted, and in some cases that could amount to hundreds of organisations, it will be very difficult to reach any sort of agreement. As I say, it is not necessarily satisfactory that the bodies actually making the inspections are to be told only after everything has been settled. These are my hesitations about Clause 28 and the way it is constructed generally. In some respects I am reassured by what the Minister said in answering the previous group of amendments. I am not arguing that there should be no replacement of Clause 28, but there are still difficulties and I would like to know the Government’s reflections on them.