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Legal Services Bill [HL]

The purpose of this part of the Bill is to ensure equality between the parties. It is important that an ombudsman’s power to require information can be backed up by enforcement. Without such, the complainant or respondent could simply ignore the ombudsman’s requests. The noble Lord has indicated that he is concerned about disproportionality in this context. The ombudsman is duty bound to determine cases in the public interest—Clause 113—and by reference to what is fair and reasonable—Clause 134. It is possible that the ombudsman receives a genuine complaint—not a frivolous or vexatious complaint—but the complainant withholds information needed to assist the ombudsman to make a determination. For example, the complainant may have a valid complaint and be seeking £10,000 redress. That complainant might be withholding documents that show he is really only entitled to £5,000. The ombudsman cannot make a determination without that information. In the example I have just given, if an ombudsman made an award of £10,000 without having the necessary documentation, he would probably fall foul of Clauses 113 and 134 in any event. When we looked at the matter, we mirrored the powers available under Sections 231 and 232 of the Financial Services and Markets Act. As the Committee would expect, they are used extremely rarely, but they provide a useful deterrent in situations such as I have described, so we consider that they are powers worth keeping. Of course, the power could not be used aggressively by an ombudsman by virtue of Clause 134(3). That states that the ombudsman can only require information if it is, "““necessary for the determination of the complaint””." Of course, the complainant can at any time and in any circumstances withdraw the complaint. The information or documents would then be no longer necessary for determination and the ombudsman would no longer have the power to require the information or pursue legal proceedings. I argue that on the grounds of fairness and in the interests of justice, it is appropriate that the ombudsman can require information from both parties and have the necessary powers to ensure that that happens in order to make determinations, bearing in mind what I have said about the complainant always having the right to withdraw if he so wishes. I hope that the noble Lord will feel reassured and able to withdraw his amendment.