I am grateful to the noble Earl, Lord Attlee. The House has hushed immediately, such is his power of control. The point is about the governance arrangements of the National Crime Agency and the move in the direction of control from the director-general to a board. It would have an independent chair, which would have responsibility for “strategic direction and control”, and would be modelled on the existing governance structure of the Serious Organised Crime Agency. Obviously, the director-general has to be responsible for the exercise of the National Crime Agency’s operational and administrative functions. However, the line of accountability would be to the NCA board, which would retain the Secretary of State’s powers to appoint and dismiss the director-general, although that would be subject to a pre-appointment hearing by Parliament. The amendments also provide for police and crime commissioners and chief constables to be represented on the board. That would formalise and facilitate that partnership, which we believe is important, between the NCA and police forces.
Having reread the Minister’s comments in Committee —from a different Minister—after the debate, I found them somewhat unsatisfactory, which is why we have brought forward this amendment today. The Government are scrapping the corporate governance structure that existed for SOCA and are instigating top-down direction from the Secretary of State, despite the fact that the new agency will be designated a non-ministerial department, unlike SOCA, which was a non-departmental government body. As the Minister will be aware, non-ministerial departments—NMDs—are, as a rule, more independent of the Government than non-departmental government bodies. According to the Standard Note in the Library of the other place on the Public Bodies Bill, a body such as an NMD would normally,
“answer directly to Parliament on issues where it has been deemed appropriate to remove executive political interference”.
The note gives the examples of Ofgem and the UK Statistics Authority. The corporate governance structures of SOCA and the NPIA provide for a board headed by an independent chair, as does that of the new Financial Conduct Authority. HMRC, which the Government cite as a model for the NCA’s new
designation, has a board whose remit is to develop and approve strategy and final business plans and to advise the chief executive on key appointments. Arguably, many of the problems of the embattled UK Border Agency, which we have just been discussing, could have been avoided had there been a board sitting between the chief executive and the Secretary of State, overseeing the functioning of the organisation.
There seems to be a contrast in that the Government’s vision of the National Crime Agency does not include a similar accountability structure. I understand—and I have to say this carefully—that the director-general will chair a non-statutory board, consisting of, we think, the senior officers, who are most likely to be the heads of the five different pillars of the NCA. I am being careful about saying that we understand that to be the case because we do not have the detail, which is not yet available. I know we will come to this debate later about the framework document and its detail, but it does hamper us somewhat in our discussions about the governance arrangements of the NCA.
The noble Lord, Lord Henley, said in Committee how important good governance is and then said, “We will set that out in the framework document”. That is for another debate, but we were promised a draft of the document and then an outline of the document to flesh out the detail. However, all we have got is a table of contents. If we look at what it says on the NCA management board, the heading is, “The NCA Management Board”, which is followed by bullet points and then sub-bullet points as follows:
“The Director General will establish and chair a Management Board … Description of the role of the Board ... Composition of the Board which will include … Ex officio members … Non-executive members”.
There is not much detail there at all.
A corporate board structure would preserve the agencies’ operational independence but would retain the ultimate strategic oversight by, and accountability to, the Government. The NCA will be responsible for a huge range of operations: it has a far wider suite of functions than SOCA has. The role of the DG will be incredibly powerful and important. It seems quite crazy that there should not be an additional layer of scrutiny over the day-to-day operations, which is something that a management board, chaired by the director-general, cannot deliver or provide. The corporate board provides the other role of keeping the Home Secretary clear from direct operational control and oversight, and protects the Home Secretary from any accusation of political interference or control. Under the government model, the NCA will be governed by one all-powerful individual, the director-general, who reports directly to the Home Secretary. The Home Secretary in turn will authorise the director-general’s annual plan, which sets out the operational priorities. The Home Secretary will hire and fire the DG without reference to any other body and determine what operational powers the director-general would have.
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This is where the problem lies in not having a corporate governance structure. The absence of any intermediary between the Secretary of State and the director-general means that the line between operational strategic roles is blurred. Without any reference to a
board, a director-general must seek sign-off for his operational plan from the Secretary of State. That direct line risks politicisation of the role. Given that the Government have set such store by the way the role of police and crime commissioners will in effect hand power back to the people, it seems odd to have a top-down structure with this particular role of the director-general and the governance of the whole National Crime Agency.
We support a clear line of accountability, therefore, between the director-general and the Secretary of State. We do not believe that the Secretary of State should have the sole power to hire, fire and influence the director-general without reference to any other body. Our amendments would provide for the director-general’s employment by the board, but the terms and conditions of employment would rightly remain determined by the Secretary of State. That would preserve the ultimate accountability to the Home Secretary while avoiding the direct oversight by the Home Secretary that is envisaged in this legislation. However, we would require, very reasonably, the Home Secretary to consult the NCA board on the appointment and also before calling for the director-general’s resignation. The Home Secretary would need to take into account, as well, any representations the board wants to make on the director-general’s behalf.
The Minister is frowning at me, but I was hoping that he might at least see his way to considering these amendments further. It seems a sensible way forward to have a more appropriate governance structure for such an important role. I beg to move.