Scotland Bill

My Lords, I approach the Dispatch Box to probe again the distinctions between what Calman recommended and what the Government have chosen to do. On this occasion, the Government have gone beyond the Calman recommendations. Clause 12 has the backing of respected bodies, such as the Law Society of Scotland and the Institute of Chartered Accountants of Scotland. During the many evidence sessions throughout the Calman process, it became clear that the insolvency profession in Scotland sought the harmonisation of insolvency law on both sides of the border. However, Clause 12 goes beyond the original Calman recommendations. Your Lordships will recall that Calman recommended that the UK Insolvency Service be responsible for laying down the rules to be applied by insolvency practitioners on both sides of the border. Calman went on to recommend that this could be achieved by UK legislation to which the Scottish Parliament would consent by a legislative consent Motion under the Sewel convention—I think those are the exact words of the recommendation. I understand that technically—a word I do not like to use—this is exactly what the Government have done in the sense that this Bill is UK legislation that has to be consented to by a legislative consent Motion by the Scottish Parliament. However, that appears to be a pedantic argument, and I do not expect that the noble and learned Lord will resort to it. The clause does not appear to be in keeping with the spirit of the original Calman recommendations. Does the Minister believe that this is the correct implementation of Calman, or does he agree that it goes beyond Calman? It goes beyond the reservation of the power for the Insolvency Service to lay down the rules to be applied by insolvency practitioners on both sides of the border and reserves the whole body of law on corporate insolvency. If the Minister agrees that this goes beyond the Calman recommendation, will he outline the reasons for so doing? The report of the Scotland Bill Committee of the Scottish Parliament, which was overwhelmingly approved by the earlier legislative consent Motion of the Scottish Parliament—as I have said before, it was supported by Alex Salmond—approved Clause 12, subject to provisions being drafted that will secure capacity for devolved legislation to effect the winding-up of registered social landlords. Does the Minister believe that this condition has been satisfactorily met? If so, can he explain why that is the case; and, if not, can he justify to this House why he has decided to pursue an alternative path to that sought by the Scotland Bill Committee? During the debate on this clause in the other place, the Scottish nationalists asserted that there were concerns about the process of amending existing provisions on winding up registered social landlords. One concern is that future amendments, they say, would be easier to come by if this policy area were devolved rather than reserved. As is often the case with Scottish nationalists, this was asserted as though it were fact, and, as is also often the case with them, the assertion was not backed up by any evidence to suggest that that would be the case. No examples were given to support this theory, for that is all it is. It appears simply to be a continuation of their argument that everything would be better if it were devolved to the Scottish Parliament. The Minister in the other place, the Parliamentary Under-Secretary of State for Scotland, argued that this is not a cause for real concern, and I support that position. However, the Minister went on to say that there was a problem and that there were ongoing discussions between the Insolvency Service and the Scottish Federation of Housing Associations to discuss the latter’s specific concerns about this clause. Perhaps the Minister will update the House on the progress, or better still the outcome, of those discussions to satisfy us that the issue has been resolved. I am certainly not the only Member of this House to have received a briefing note from the Scottish Federation of Housing Associations that articulated continuing concern about the impact of this clause. I would not like to think that this is a sign that discussions were not successful, but if they were not successful, the Minister should explain to the Committee what is going on. There is an identified issue here about circumstances that may arise in the winding-up or potential insolvency of a particular vehicle for delivering important housing in Scotland or a housing association. It is recognised that this needs to be resolved by discussion or perhaps by a change in regulation. Before we agree to this clause standing part of the Bill as drafted, your Lordships' House is entitled to know whether that issue has been addressed and satisfactorily resolved, or at least to have the confidence that a resolution is on its way.