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Sale of Student Loans Bill

On at least three occasions in the Public Bill Committee, the Minister was clear about ““shall”” and ““may”” and the Government's position on that. I shall quote from column 62 of our deliberations in Committee on 4 December, where my hon. Friend said:"““My clear understanding is that were we to insert the word 'shall' in clause 3(6)(a), that would make us unable to classify the debt as a transfer from the public to the private sector. However, there are other protections available to us in clause 3(6)(b) and (c) to enable us, through the contract, to protect the interests of the graduate.””" I shall break that down into two parts. To me, the easier and less intricate part, if I may put it that way, is in the second half of the quote that I just read out, where the Minister, as he had earlier in that debate in Committee, referred to ““other protections””. The other protections in clause 3(6)(b) and (c) in the Bill as drafted—in contradistinction to the Bill as it would be, were the amendments to pass—or, as the Minister also described them, the"““other tools at our disposal””—[Official Report, Sale of Student Loans Public Bill Committee , 4 December 2007; c. 61-62.]" come under the permissive rather than mandatory rubric of the first line of clause 6, which contains the phrase"““transfer arrangements may””." The permissive word ““may””, rather than the mandatory word ““shall””, covers (a), (b) and (c), so I should like a little clarification from my hon. Friend the Minister as to how those other protections would not be potentially weakened, just as the protection in clause 3(6)(a) is arguably weakened, because they are all under the umbrella of ““may”” rather than ““shall””. To me, the more intricate point, which unfortunately leads us to another ““shall”” and ““may””, is the clarification that my hon. Friend issued to members of the Committee, sending them a copy of the letter that he wrote on 12 December to the Chair of the Committee, my hon. Friend the Member for Aberdeen, South (Miss Begg), for the benefit of all members of the Committee. He stated on page 2 of his letter:"““The most important factors in deciding the classification are whether there has been a real transfer of risk and control to the private sector. Under the current classification rules, using Clause 3(6)(a) would provide evidence that the Secretary of State had retained an element of control over the loans in the event of onward sale, and would affect ONS's decision to classify the loans as having been sold.””" I want to probe that a little further with my hon. Friend, which I shall do in a moment by way of an example. It is not clear to me whether the word ““would”” in the phrase"““would affect ONS's decision to classify the loans as having been sold””" is a permissive or a mandatory word—that is, whether the ONS definitely would say, ““'Shall' means that the Government have control, therefore the loans do not go off the public books”” or whether the ONS might so classify it if the House decided to use the word ““shall”” rather than ““may”” in clause 3(6). The wording in the Minister's letter relates to retaining an element of control. My partner and I have lived in the same house for 23 years—bear with me on this for a moment, if you would, Madam Deputy Speaker. The house was built in about 1888. We bought it from another married couple, who had bought it from the Roman Catholic archdiocese of Birmingham. It had inherited the house from somebody who had owned it for a number of years; I know nothing about the chain leading back to 1888. In the deeds, there is a restriction on brewing beer for commercial purposes. That is quite a common restriction for terraced houses built in the midlands in the 19th century; I saw it several times during the little bit of conveyancing that I did in my former career. Whoever has the benefit of that restrictive covenant will be the heirs and assigns of whoever imposed that covenant—possibly the builder—in about 1888. That family retains an element of control over how my wife and I can or cannot use our property. However, it would be clear to most lay people—and, I think, to most lawyers, although I am not much of a conveyancer—that the clear ownership of the property had been outwith that family for 120 years. So when I consider the student loan book that might be transferred, it seems to me that, were the word ““shall”” to be used in clause 3(6), the Office for National Statistics—I do not know all the rules—might not classify this as a prohibition on saying that the debt was off the books.