The new Solicitors Accounts Rules: what has changed?
A new committee has been set up by the government to scrutinise the large number of Statutory Instruments needed as part of Brexit.
Statutory Instruments (‘SIs’) are pieces of delegated legislation made by Ministers using powers conferred upon them by Acts of Parliament. They tend to be orders, rules or regulations which fill in the details not already contained in primary legislation. For instance, the Immigration (European Economic Area) Regulations 2016, provide a detailed code created by Ministers using the powers conferred on them by s. 2(2) of the European Communities Act 1972(2) and s.109 of the Nationality, Immigration and Asylum Act 2002(3).
Over the years, there has been a sharp increase in the use of SIs by successive governments. A House of Lords response to the Strathclyde Review showed that before 1992 there were never more than 2,500 SIs a year, whereas after 1992 there have tended to be around 3,000-3,500 a year. This may be partially due to a general increase in the size of the administrative state and also growing volumes of EU law being incorporated through SIs using s.2(2) of the European Communities Act 1972. As a result of Brexit, 800 more SIs are expected to be made to resolve gaps to the statute book caused by the UK’s withdrawal from the EU, at a rate of approximately 35 to 45 a week.
A major concern about the European Union (Withdrawal) Act 2018 (the ‘EUWA’) during its passage through the Houses of Parliament, was its reliance on ‘Henry VIII’ powers. These are a controversial form of SI that gives ministers the power to amend even primary legislation (rather than this being left to Parliament). They are often regarded with suspicion due to the extent of the power given to the minister.
As with all SIs, the use of Henry VIII powers has been on the increase and, even before Brexit, this prompted concerns. In 2016, Lord Judge criticised the Childcare Act 2016, which in s.4 (2) (d) gave a power to ‘amend, repeal or revoke any provision made by or under an Act (whenever passed or made)’, in a lecture at King’s College London, describing it as “saying very little, but…creat[ing] huge ministerial powers”. The Banking (Special Provisions) Act 2008 was criticised because it purported to allow Treasury ministers to "dis-apply any specified statutory provision or rule of law" and the Constitutional Reform and Governance Act 2010 was criticised for apparently allowing ministers to amend or repeal any prior statute dealing with the civil service, treaties or MPs' expenses.
Many SIs are not subject to formal parliamentary scrutiny and control other than limited preliminary review by certain committees. With the use of SIs increasing, the work of those committees has become increasingly important and Brexit is likely to reinforce this trend.
The main committees involved are as follows:
Some SIs are also subject to formal parliamentary scrutiny and control, the nature of which is often specified in the Act of Parliament under which they are made. The two most common forms are the ‘negative’ and ‘affirmative’ procedures.
The negative procedure is the most common. It is where an SI is laid before the Houses of Parliament, and Members have a period (generally 40 days) in which they can bring a motion to annul, which would reject the SI. If there is no motion to annul, the SI automatically becomes law after the period ends. Motions to annul, however, are very uncommon in practice.
Under the less common affirmative procedure, an SI must be actively approved by the House of Commons and the House of Lords, meaning that the SI may be subject to more engaged scrutiny than under the negative procedure. However, as with SIs going through the negative procedure, those subject to the affirmative procedure are very rarely blocked.
After approval, SIs can still be challenged in the Courts through judicial review, such as on the basis that they are ultra vires.
SIs are so central to the Brexit process because the EUWA will incorporate the huge body of EU law into UK law in order to avoid gaps in the law after Brexit. On Exit Day, the body of EU law will automatically be converted into UK law. The intention is then that pieces of legislation that are ‘deficient’ or require change in light of the circumstances after Brexit can then be amended or repealed piece by piece by Ministers using wide-ranging powers to make SIs (including Henry VIII powers to amend primary legislation). The alternative of passing the changes through Parliament as primary legislation would require huge amounts of parliamentary time (quite possibly far more time than exists). The main powers Ministers will use to do this job are contained in the EUWA.
In the government’s Brexit White Paper, it states that the “UK Government will work with the UK Parliament to ensure that both Houses have the mechanisms they need to properly scrutinise proposed changes to UK law, whether to primary or secondary legislation…adapting scrutiny arrangements as appropriate, and recognising the quality and expertise in the existing scrutiny structures in the Commons and the Lords”.
A recent report by the House of Commons Procedure Committee identified the scale of the task. It estimated that the government will be laying at least 800 SIs before parliament, at a rate of approximately 35 to 45 a week due to Brexit. The amount of SIs will therefore sharply increase, putting more pressure on the Parliamentary resources available to scrutinise them. A change of approach to parliamentary scrutiny is therefore needed.
The House of Commons Procedure Committee has suggested three main methods for ensuring proper scrutiny of these Brexit related SIs.
First, the Government should “provide a detailed ‘anti-transposition’ note for each instrument, setting out the drafting approach the Government is taking to disengage UK law from EU obligation in each case”. This will be in addition to the plain English explanatory note which it is already necessary to accompany any SI.
Second, the role of the SLSC should be expanded, so that, as well as considering the merits of SIs, it will also be involved in the sifting process of deciding whether an SI will be subject to negative or affirmative procedure or not.
Third, a new committee should be set up, the role of which will be specifically to assess SIs (including those made under Henry VIII powers) related to the EU withdrawal process which fall into three categories, and consider whether they should be laid before the Houses of Parliament through the negative procedure. These three categories are:
This new committee has already been instigated by government, and will be called the European Statutory Instruments Committee (‘ESIC’), with ex-Conservative Party chairman, the Rt. Hon. Sir Patrick McLoughlin MP, as Chair. Other issues which ESIC will consider include the legal and political importance of the SIs in question. It will be encouraged to work with the other SI committees in order to properly understand and analyse all aspects of each SI, and a recent announcement from ESIC asked for input from the general public about how it should form its decision making process.
On the one hand, the forthcoming formation of the ESIC and the other suggested reforms seem positive. Constitutional issues and practical problems with (particularly Brexit related) SIs are more likely to be identified and debated due to the additional focus they will receive. This of course assumes that the proposed reforms will be enough to increase the focus on individual SIs despite the overall increase in their number.
However, very few SIs, even those which are subject to the affirmative procedure, are outright rejected by Parliament. At the time Richard Kelly wrote his guide to Statutory Instruments in December 2016, the last time the House of Commons had annulled an SI subject to the negative procedure was in 1979 and the last time an SI subject to the affirmative procedure had been annulled was 1978. There is therefore some risk that an increase in the scrutiny of SIs and even in the use of the negative and affirmative procedures may simply consume more Parliamentary time, without more substantive action actually taking place.
In addition, under the proposals the government would not be obliged to follow the recommendations of ESIC although it has committed that if it were to reject any recommendation it would aim to make a statement at the Despatch Box explaining why. Ultimately this may mean that the proposed new committee lacks bite.
It is of course always open to members of both Houses to play a greater role in scrutinising SIs when they are laid before Parliament. The wariness expressed by Members of both Houses about the Henry VIII powers in the Act is potentially an indication that this will happen, but parliamentarians have many demands on their time and other priorities may prevail. Whatever mechanisms are put in place to respond to the challenges posed by Brexit related SIs, the objective must be that the lawfulness of ministerial action is secured, and the delicate balance of powers under the UK constitution is maintained.
Should you require advice about the issues covered in this blog, please contact a member of our Public Law team.
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