To ask the Secretary of State for Health and Social Care, with reference to the all-party Parliamentary group on cerebral palsy’s report, Early identification, intervention and pathways of care of infants and young children with cerebral palsy: The case for reform and investment, published in March 2021, whether his Department...

To ask the Secretary of State for Health and Social Care, with reference to the all-party Parliamentary group on cerebral palsy’s report, Early identification, intervention and pathways of care of infants and young children with cerebral palsy: The case for reform and investment, published in March 2021, whether his Department...

To ask Her Majesty's Government, further to the Liverpool City Council: Best Value inspection report, published on 24 March, what plans they have to strengthen the audit arrangements in place for local authorities.

To ask Her Majesty's Government, further to the Liverpool City Council: Best Value inspection report, published on 24 March, what plans they have to strengthen the audit arrangements in place for local authorities.

To ask the Secretary of State for Health and Social Care, what recent progress the Government has made on the retrospective audit of mesh implants announced in January 2018.

To ask the Secretary of State for Health and Social Care, what recent progress the Government has made on the retrospective audit of mesh implants announced in January 2018.

These proposals are to provide information to expert users and many of the ordinary readers as well. Therefore, both markets are to be fulfilled.

These proposals are to provide information to expert users and many of the ordinary readers as well. Therefore, both markets are to be fulfilled.

My noble friend makes a good point but the proposals will not provide a disincentive to people taking on new appointments. It is important to remember that the proposals for directors’ accountability apply only to the largest companies with revenues into the hundreds of millions of pounds and with hundreds, sometimes thousands, of employees. It is right that directors should take more responsibility.

My noble friend makes a good point but the proposals will not provide a disincentive to people taking on new appointments. It is important to remember that the proposals for directors’ accountability apply only to the largest companies with revenues into the hundreds of millions of pounds and with hundreds, sometimes thousands, of employees. It is right that directors should take more responsibility.

Professor Karthik Ramanna of the Blavatnik School of Government at Oxford said in the FT last week that corporate auditing is in crisis and that the UK Government have announced a bold set of proposals aimed at restoring public trust in audits and markets. The UK’s reputation as a world leader in corporate governance is highly prized and a vital part of what makes the UK an attractive place to invest and do business. What assessment have the Government made of the impact of these reforms on UK businesses, and how will the Government ensure that they will not affect the country’s ability to attract foreign investment nor stifle entrepreneurial spirit?

Professor Karthik Ramanna of the Blavatnik School of Government at Oxford said in the FT last week that corporate auditing is in crisis and that the UK Government have announced a bold set of proposals aimed at restoring public trust in audits and markets. The UK’s reputation as a world leader in corporate governance is highly prized and a vital part of what makes the UK an attractive place to invest and do business. What assessment have the Government made of the impact of these reforms on UK businesses, and how will the Government ensure that they will not affect the country’s ability to attract foreign investment nor stifle entrepreneurial spirit?

I do not agree that the audit market is in crisis. Some worthwhile improvements can be made, which is what we are proposing. The noble Lord will see that a full impact assessment is attached to the proposals.

I do not agree that the audit market is in crisis. Some worthwhile improvements can be made, which is what we are proposing. The noble Lord will see that a full impact assessment is attached to the proposals.

My Lords, further to the question of my noble friend Lord McKenzie, can the Minister confirm that any annual report on the state of the City, as proposed in the report of the noble Lord, Lord Hill, will clearly outline how the dominance of the big four accountancy firms has been reduced?

My Lords, further to the question of my noble friend Lord McKenzie, can the Minister confirm that any annual report on the state of the City, as proposed in the report of the noble Lord, Lord Hill, will clearly outline how the dominance of the big four accountancy firms has been reduced?

The big four accountancy firms are important to the regime but we want to introduce more possible competition into it, which is why we are introducing the proposals for shared managed audit to try to bring up the capacity of medium-sized companies.

The big four accountancy firms are important to the regime but we want to introduce more possible competition into it, which is why we are introducing the proposals for shared managed audit to try to bring up the capacity of medium-sized companies.

My Lords, given the clear struggle in the report, Restoring Trust in Audit and Corporate Governance, to find a workable model for auditing large UK companies, and given Deloitte UK managing partner Stephen Griggs’s comment to Accountancy Age, stating that,

“It is important that changes in audit are complemented by reforms to the governance of the UK’s largest and most complex businesses”,

does the Minister agree that the terms given to the UK listing review were fundamentally flawed? We do not need a more complex so-called competitive sector, but rather simpler, more secure, stable and auditable company structures.

My Lords, given the clear struggle in the report, Restoring Trust in Audit and Corporate Governance, to find a workable model for auditing large UK companies, and given Deloitte UK managing partner Stephen Griggs’s comment to Accountancy Age, stating that,

“It is important that changes in audit are complemented by reforms to the governance of the UK’s largest and most complex businesses”,

does the Minister agree that the terms given to the UK listing review were fundamentally flawed? We do not need a more complex so-called competitive sector, but rather simpler, more secure, stable and auditable company structures.

We are discussing audit reforms and reforms to the audit market. I think that the noble Baroness may want to have a separate debate about reforms to company structures.

We are discussing audit reforms and reforms to the audit market. I think that the noble Baroness may want to have a separate debate about reforms to company structures.

My Lords, I refer to my interests in the register. I hope my noble friend realises that this audit and governance package is onerous. It will place significant costs on businesses of all shapes and most sizes and is, I fear, unlikely to achieve a lot in practice. Does he not agree that the best and more immediate way forward would be for the existing, comprehensive rules to be enforced properly by everyone—including firms, auditors and, if appropriate, prosecutors—while minimising the burden of any new regulations?

My Lords, I refer to my interests in the register. I hope my noble friend realises that this audit and governance package is onerous. It will place significant costs on businesses of all shapes and most sizes and is, I fear, unlikely to achieve a lot in practice. Does he not agree that the best and more immediate way forward would be for the existing, comprehensive rules to be enforced properly by everyone—including firms, auditors and, if appropriate, prosecutors—while minimising the burden of any new regulations?

I know that my noble friend is passionate about not imposing new burdens on companies. I share her desire, but we think that the current regime could be improved. There will be a 16-week consultation period, so we will take the time to get these proposals right, but I think that some worthwhile improvements could be made without damaging competitiveness.

I know that my noble friend is passionate about not imposing new burdens on companies. I share her desire, but we think that the current regime could be improved. There will be a 16-week consultation period, so we will take the time to get these proposals right, but I think that some worthwhile improvements could be made without damaging competitiveness.

My Lords, I have two points. First, in the absence of a central enforcer of company law, improvement in corporate governance is unlikely. Secondly, in the absence of tougher auditor liability and accountability, there are not sufficient pressure points to secure improvements in audit quality. When will the Government realise that their appeasement of big corporations and accounting firms is actually a recipe for more scandals?

My Lords, I have two points. First, in the absence of a central enforcer of company law, improvement in corporate governance is unlikely. Secondly, in the absence of tougher auditor liability and accountability, there are not sufficient pressure points to secure improvements in audit quality. When will the Government realise that their appeasement of big corporations and accounting firms is actually a recipe for more scandals?

We are not appeasing the big accountancy firms; many of them do not like some of our proposals. These are worthwhile reforms that will improve the market and help to bring about the state of affairs that the noble Lord refers to.

We are not appeasing the big accountancy firms; many of them do not like some of our proposals. These are worthwhile reforms that will improve the market and help to bring about the state of affairs that the noble Lord refers to.

My Lords, the White Paper proposals place onerous obligations on directors of larger businesses. Does my noble friend the Minister share my concerns that the reforms will discourage candidates, due to the increased and unnecessary liability? Further, does he agree that companies will face greater regulation, higher directors’ fees and indemnity costs at a time when the noble Lord, Lord Hill, is, sensibly, attempting to improve access to capital markets?

My Lords, the White Paper proposals place onerous obligations on directors of larger businesses. Does my noble friend the Minister share my concerns that the reforms will discourage candidates, due to the increased and unnecessary liability? Further, does he agree that companies will face greater regulation, higher directors’ fees and indemnity costs at a time when the noble Lord, Lord Hill, is, sensibly, attempting to improve access to capital markets?

I do not agree with my noble friend. As I said earlier, accountability for directors applies only to those in the largest businesses—that is, those with revenues in the hundreds of millions of pounds and potentially thousands of employees. The new sanctions will apply only in cases where directors have clearly failed in their duties as set out in law, so I do not believe that there is a conflict with the proposals made by the noble Lord, Lord Hill.

I do not agree with my noble friend. As I said earlier, accountability for directors applies only to those in the largest businesses—that is, those with revenues in the hundreds of millions of pounds and potentially thousands of employees. The new sanctions will apply only in cases where directors have clearly failed in their duties as set out in law, so I do not believe that there is a conflict with the proposals made by the noble Lord, Lord Hill.