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Public Bodies Bill [HL]

My Lords, I declare an interest as the current chair of the Security Industry Authority and president of the Association of Police Authorities. In the speech I made at Second Reading I told the House about the enormous concern with which the Government’s proposal to abolish the organisation and return to self-regulation of the industry was greeted, particularly by people in the industry and also by Scotland and Northern Ireland. Last week the chairman of Security Alliance said how the inclusion of the SIA on the list for abolition came as a great surprise to the industry. He said that since regulation was introduced, there had been a general acceptance in the industry that licensing had been a force for good. So that is clearly understood and agreed across the industry. We know there has been a lot of criticism recently in the other place by the Public Administration Committee about the handling of the bonfire of the quangos. The committee said it was a rushed, botched job with no clear evidence of savings or concern for value for money or efficiency. More important for the SIA was the lack of consistency in applying the three questions and the issue of whether they were even the right questions to ask. I asked at Second Reading why the SIA was being abolished when the Gangmasters Licensing Authority was being spared—a question which has not yet been satisfactorily answered. The Public Administration Committee’s report asked exactly the same question. The silence in response is deafening. I asked another question to which there has been no response: why is it that the Government believe the industry is mature enough at this moment in time to regulate itself when the Scottish Government, the Northern Ireland Administration and even large parts of the industry disagree very strongly. Yet the Minister told us at Second Reading that there had been no major disagreements on the legislation between the Government and the Scottish Government. I do not think that is entirely an accurate description but obviously I defer to others on that. The most serious issue I had with the Government on this matter was their lack of consultation with the industry. After all it was the BSIA and other bodies and individuals within the private security industry which consistently pressed for regulation of the industry in the 1980s and 1990s and they have supported it and for the most part paid for it. Surely, therefore, the views of the industry should have been sought before the policies were drawn up, not to mention the uncertainty caused to 350,000 individuals working in the industry, many of whom funded their own licence fee and invested in their training. Surely there should have been consultation with all these people. Certainly the view of the Public Administration Committee was that there should be consultation with all the bodies listed in this Bill, even at this late hour, and who can say that it is wrong? In the case of the security industry, its leaders sensibly were not prepared to wait that long. Indeed, they made their opposition to the ending of regulation and the abolition of the SIA very clear. They wrote to the Home Secretary, the Prime Minister and the Deputy Prime Minister. They organised and they highlighted the tremendous risks inherent in the Government’s proposals, forcing the Government to change their mind. Instead of abolition the Government agreed that there should be a phased transition to a new regulatory regime and that the SIA should no longer be an NDPB. So there has been a change and therefore this Bill is already out of date in terms of regulation of the private security industry. In the exchange of views that took place between the Government and the industry, industry leaders made it clear that they were already discussing with the Security Industry Authority a blueprint for the evolution of regulation whereby the regulator and the industry would work together to produce smarter, more cost-effective regulation and would press the Government to introduce business registration alongside individual licensing so that we could move to a more efficient, effective and lighter-touch regulatory regime—““better for less””, to use the Government’s own phrase. That was certainly what the industry was working towards with the SIA. As the Public Administration Committee so rightly observed, the major issue at stake in relation to quangos should not be about their status or structure but about effectiveness and delivering value for money. Since last summer the SIA has been in discussion with the industry about precisely these matters. The issue before us in this discussion on the Security Industry Authority is not a simple should it or should it not be abolished, but how best to facilitate a phased transition from the current regulatory regime to lighter touch, smarter regulation in which industry bodies and leaders play an increasingly active and important role alongside the SIA. There is no disagreement about that. The issue is that it is a process which will take time. It cannot be rushed. It has to include all sections of the industry that are currently regulated. While the recent emergence of the Security Alliance as a unified voice for the industry is to be welcomed as a very positive development, it is by no means fully established across the industry. So there is a lot of work to be done, and along the way the decisions made by the Home Office and the Government in relation to the extent of regulation—for example, that it should not include in-house security, or for the time being private investigators or security consultants—will undoubtedly be queried and challenged by many in the industry. If we are discussing the industry’s future, people working in it want to raise many things. Then there are the views of Scotland and Northern Ireland. I cannot speak with enormous knowledge about these areas but the licensing of private security has been a huge success both in Scotland and Northern Ireland. It has been in Scotland since 2007 but licensing in Northern Ireland is just a year old. The Northern Ireland Administration are in no rush to change it and we can understand why. They think that it has made a big difference. Both those areas have elections in the spring and we will have to wait to find out the views of the new Administrations and Governments that result. A lot is standing in the way of progress at the moment. As part of the phased transition process, the industry is strongly of the view that the Government should play their part by showing a willingness to bring in business registration in the industry, alongside the licensing of individuals. I hope that the Minister will be able to commit the Government to action in relation to business registration when she replies, as the industry is keen to see that. We are working to move forward. We in the SIA are consulting a whole range of bodies, including the strategic consultation group, a Security Alliance industry panel, and so on, because it is important to have agreement with the industry and major stakeholders on key principles and milestones for the future, while being conscious, as was said, of the need to proceed cautiously before the Olympics in 2012. There are also the Commonwealth Games in Scotland in 2014 and we must not forget that. It is important to put on the record that many senior figures in the industry are urging caution. They do not believe that the industry is yet ready for self-regulation. I strongly support giving the industry more responsibility in terms of licensing and training, but I share its view that there is no evidence at present that it is sufficiently mature at this point for self-regulation. We have to move very gradually towards that goal. Substantial progress will have been made towards establishing a new regulatory regime by 2014 but there is the big issue of effective intelligence and enforcement operations. It is important that they continue and that the state continues to maintain a strong regulatory regime in respect of criminality; in respect of criminals and their associates; and in respect of those who continue to seek to undermine and weaken the regime. Everyone who works in the industry wants the regime to be effective in driving out and keeping out criminality and in upholding robust standards. That is extremely important because the credibility of the industry requires strong intelligence and enforcement activity, which has to continue in any new regime. There is a considerable way to travel. Listing the SIA in Schedule 1 to the Bill was a misguided and inappropriate step for the Government to take. We are talking about Schedule 3 and changing the nature of the organisation and moving it to something different. The important thing is that we all want to build on and improve the regulation that has been introduced. It has been a great success and we want to continue it both with the industry and the devolved Administrations. We have to work with them at their pace, which I hope the Government will be supporting so that we can move forward together.