Enterprise Bill
Report Stage, House of Lords
25 November 2015
Briefing supporting Government Amendment numbers 19 to 37 to
Clauses 13 and 14 and Schedule 2
For more information, please contact:
Parliamentary lead: Finola Kelly, Head of Parliamentary and Public
Affairs
finola.kelly@equalityhumanrights.com
DD: 0207 832 7826
Mob: 07932 799 120
Legal lead: Sarfraz Khan, Senior Lawyer
DD: 0161 829 8414
sarfraz.khan@equalityhumanrights.com
Introduction
This briefing supports Government Amendments 19 to 37 to Clauses 13
and 14 of, and Schedule 2 to, the Enterprise Bill.
At Committee stage, the Equality and Human Rights Commission
supported amendments aimed at ensuring that the Bill’s new
requirements on regulators would not place disproportionate burdens on
the Commission, and at protecting our ability to operate independently in
order to safeguard our ‘A’ status as a UN-accredited National Human
Rights Institution. Government Amendments 19 to 37 address our
concerns by:
 removing the requirements on regulators in Clause 13 and
Schedule 2 to report to and provide information to Government
about the Business Impact Target (BIT), replacing them with a
duty to publish the relevant information, and
 exempting the Commission for Equality and Human Rights from
the duty in Clause 14(10) to provide ad-hoc information to
Government about performance under the Regulators’ Code.
The Commission welcomes these amendments, which deliver the
Government’s intention of improving transparency about the effect of
regulatory activities on business while safeguarding our ability to carry
out our statutory functions free from Government direction or control.
We also strongly welcome the Minister’s assurance in Grand Committee
that the Commission will not be subject to the growth duty contained in
the Deregulation Act 2015 when the relevant secondary legislation is
brought forward. Her assurance, together with the amendments to
Clauses 13 and 14 and Schedule 2, address many of our earlier
concerns about actual or perceived constraints on our operational
independence.
Summary
 Removing the obligations in Clauses 13 and 14 and Schedule 2 to
report and provide information to Government helps to protect the
Commission's operational independence while still meeting the
Government's desire for improving transparency about the impact
of regulators’ actions on business.
 It remains important to ensure that Clauses 13 and 14 are
implemented proportionately so that they do not impose excessive
administrative costs on regulators, and that they not have the
unintended consequence of acting as a barrier to work which is
helpful to business.
Clause 13 and Schedule 2
Government Amendments 19 to 36
Explanation
Government Amendments 19 to 36 remove the duties on regulators in
Clause 13 and Schedule 2 to report to and provide information to
Government about the Business Impact Target, replacing them with a
duty to publish the relevant information.
Commission’s recommendation
 Support Government Amendments 19 to 36.
 The Commission would welcome assurances that the BIT process
and methodology will be both proportionate and practical.
Our analysis
The Commission welcomes Government Amendments 19 to 36, which
address our previous concerns about the impact of a duty to report to
Government on our operational independence. Our ‘A’ status as a UNaccredited National Human Rights Institution depends, under the UN
Paris Principles, on our independence to operate free from Government
Direction or control.
In our analysis, replacing the previously proposed duty to report to
Government with a duty to publish the relevant information will achieve
the Government's objective of improving transparency about the impact
of regulatory activity while avoiding the risks to our independence. We
have no difficulty in principle with assessing our impact in line with an
agreed methodology or our assessments being verified by the
independent Regulatory Policy Committee as complying with the agreed
methodology.
However, it is essential that the extension of the BIT to regulators is
implemented proportionately so that it does not impose excessive
administrative costs on regulators, and that it does not have the
unintended consequence of acting as a barrier to work which is helpful
to business. Work is still in progress on devising the BIT process and
methodology, and the Commission is engaged with Government officials
on this. In doing so, we are seeking to ensure that the process does not
add delay to the Commission's work; we consider that the assessment
and validation process should be carried out after the relevant
regulatory activity has taken place. We are also seeking to ensure that
the methodology is simple, practical and light-touch, and recognises the
positive impact on business of well-targeted and high quality, practical
guidance explaining complex legal requirements. We would welcome
the Government’s assurance that its approach to implementation will
seek to achieve proportionality and practicality for regulators.
The Commission raised concerns during Committee stage about the
retrospective effect of the commencement provisions in Clause 29. As
the BIT requirement is for the duration of the present Parliament, Clause
13, which extends that requirement from Government to national
statutory regulators, would have retrospective effect from May 2015,
whenever Clause 13 is commenced and implemented.
In the Commission’s analysis, new statutory requirements should not
generally have retrospective effect because we consider this does not
accord with good legislative practice or with public law principles. We
consider that the BIT requirement on national statutory regulators should
apply to regulatory activity undertaken only after the date the
requirement comes into force after being enacted by Parliament. We
intend to return to this concern as the Bill progresses. However, should
Parliament decide to retain the current retrospective effect of the BIT
requirement on regulators, we would urge the Government to consider
the scope for a less resource-intensive methodology and process for
conducting and validating impact assessments relating to regulatory
activity which takes place before the extension of the BIT to regulators is
implemented.
Clause 14
Government Amendment 37
Explanation
Government Amendment 37 removes the Commission specifically from
the obligation in Clause 14(10) to provide ad-hoc information requested
by the Government.
Commission’s recommendation
 Support Government Amendment 37.
 The Commission seeks assurances that the new business
engagement requirements will be proportionate, allowing for
existing engagement mechanisms (such as our routine contact
with business organisations and our two-yearly stakeholder
survey) to be used to fulfil these requirements wherever possible.
Our analysis
The Commission is committed to acting in line with the Regulators’
Code, and to being transparent about the impact of our work on
business and others. We therefore welcome Government Amendment
37, which addresses our concern about the impact on our operational
independence if we were subject to the duty in this clause to provide
information on an ad-hoc basis to Government. We are keen to increase
our accountability to Parliament, and already provide information on our
activities in our Annual Report and Accounts, which are laid before
Parliament each year and published. We envisage complying with the
Clause 14 duty to report on our performance under the Regulators’ Code
through this existing mechanism.
We do, however, consider that any new business engagement
requirements imposed through ministerial guidance under Clause 14
should be proportionate, allowing for existing engagement mechanisms
(such as our routine contact with business organisations and our twoyearly stakeholder survey) to be used to fulfil these requirements
wherever possible.
About the Equality and Human Rights Commission
The Equality and Human Rights Commission is a statutory body
established under the Equality Act 2006. It operates independently to
encourage equality and diversity, eliminate unlawful discrimination, and
protect and promote human rights. It contributes to making and keeping
Britain a fair society in which everyone, regardless of background, has
an equal opportunity to fulfil their potential. The Commission enforces
equality legislation on age, disability, gender reassignment, marriage
and civil partnership, pregnancy and maternity, race, religion or belief,
sex and sexual orientation. It encourages compliance with the Human
Rights Act 1998 and is accredited by the UN as an ‘A status’ National
Human Rights Institution.
Find out more about the Commission’s work at:
www.equalityhumanrights.com