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Oral Answers to Questions
(8 years, 5 months ago)
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Stuart Blair Donaldson (West Aberdeenshire and Kincardine) (SNP)
1. What plans his Department has to ensure future defence co-operation with allies and partners.
Callum McCaig (Aberdeen South) (SNP)
11. What plans his Department has to ensure future defence co-operation with allies and partners.
The Secretary of State for Defence (Michael Fallon)
I hope you will allow me, Mr Speaker, to add my tribute to Jo Cox and her work on behalf of the Syrian people, which she pressed very hard on and which must never be forgotten.
Our strategic defence review set out ambitious plans to strengthen our work with allies and partners to promote our security and prosperity. We will continue to lead in NATO, the G7 and the United Nations, and maintain strong and enduring relationships with the United States and our other friends and allies around the world.
Stuart Blair Donaldson
My constituency, my country and people of my generation voted against Brexit, yet we are going to be dragged out of the European Union against our will. This is the same European Union that plays an important security role in Afghanistan, in Ukraine and across swathes of Africa, as well as the vital role played by Frontex in the Mediterranean. What reassurance does the Secretary of State have for Scotland and for young people that this vital work will not be undermined by last Thursday’s vote?
Michael Fallon
The bedrock of our defence in the United Kingdom rests on NATO, and the United Kingdom of England, Scotland, Wales and Northern Ireland is committed to strengthening co-operation within NATO and collective defence across the alliance. We will be adding further reassurance to that at the NATO summit that is coming up in Warsaw the week after next.
Callum McCaig
What an utter shambles this is. I am afraid that that is not good enough from the Defence Secretary. We do not have a plan A for Brexit, let alone a plan B. The position of the Government and the Brexiters is confused. There is no plan on the table. Are we going to do a Norway? May I suggest to the Defence Secretary that we look at doing a Norway when it comes to defence, and we perhaps go for the opt-in that Norway has to EU defence schemes?
Michael Fallon
Norway remains and is a very valued member of the NATO alliance. We will be intensifying our co-operation with such countries. It is true that membership of the European Union complements our membership of NATO, and we are engaged in an EU operation in the central Mediterranean, continuing to save lives there and to disrupt the business model of the migrant smugglers from Libya to Europe. The Royal Navy will continue that task.
Mr James Gray (North Wiltshire) (Con)
Does the Secretary of State agree that our relationship with members of the EU will remain as strong as it is today even when we are not a member? Given that nearly all members of the European Union are members of NATO, and that most members of NATO, leaving aside Turkey and the United States, are members of the EU, surely the fact that we are that cornerstone of NATO stands for our strong defence, and being a member of both involves some degree of duplication.
Michael Fallon
We have continued to argue against duplication between the European Union and NATO, but my hon. Friend is right. We have the very important bilateral relationships with other European countries—the Lancaster House treaty with France, and our growing co-operation with Germany—and I reassured both the French and German Defence Ministers last Friday that we will continue to work at those relationships and to strengthen them.
Kevin Foster (Torbay) (Con)
In the light of the result last week, will the Secretary of State reassure me that the United Kingdom as a united kingdom remains as committed in both the conventional and nuclear sense to article 5 of the North Atlantic treaty, for our allies in the eastern parts of Europe?
Michael Fallon
Absolutely. That article is one of the central commitments of NATO. We have, as my hon. Friend knows, committed to the 2% NATO defence spending target and we will be offering further reassurance, particularly to members on the eastern flank of NATO, at the Warsaw summit on Friday week.
Mr Ben Bradshaw (Exeter) (Lab)
Given the intensified bombing of Aleppo by President Putin over the weekend, and the important role that Britain played in stiffening European resolve on sanctions against the Putin regime, how concerned is the Secretary of State about the impact of the referendum result on European solidarity in standing up to Putin?
Michael Fallon
It is very important, not least because of the way in which Russia has intervened in the Syrian civil war, that Russia is held to account for its actions. We took the lead in not only proposing the sanctions imposed on Russia for its actions in the Crimea—in the Ukraine—but ensuring that they were continued. They are being continued for the moment, but, obviously, once we are outside the European Union, our influence over that will be slightly diminished.
Marcus Fysh (Yeovil) (Con)
Does my right hon. Friend agree that the upcoming negotiation on leaving the EU presents a huge opportunity to redouble our efforts at co-operation with our EU friends and allies? What plans does he have to support UK defence industries and cross-border investments, such as those in helicopter manufacturing in Yeovil?
Michael Fallon
We will continue the co-operation that I have already set out—our co-operation with France under the Lancaster House treaty, and the growing co-operation we have with Germany and, indeed, with other European countries. Our recent strategic defence review is international by design and prioritises working more closely with our allies. European companies that are invested here see a rising defence budget, and we hope they will continue to invest here and to compete for the various tenders we are making available.
Liz Kendall (Leicester West) (Lab)
Our military alliances rely on strong diplomatic ties, especially with our European neighbours. What steps is the Secretary of State taking to ensure our Brexit negotiations do not sour these relationships and weaken our alliances?
Michael Fallon
As I say, I have spoken to all my fellow Defence Ministers in these key relationships, and we will have to work hard to ensure that these bilateral relationships are kept in good repair. We have strong defence relationships and defence sections in these embassies across Europe, and we will have to look at them independently and make sure in the Brexit negotiations that none of that co-operation—the joint training, the exercising and the co-operation on capabilities—is put at risk.
Mike Wood (Dudley South) (Con)
What representations has my right hon. Friend received from our allies and defence partners about renewing Trident, which the new shadow Defence Secretary described as
“a monumental mistake our country and planet can ill afford”?
Michael Fallon
As my hon. Friend knows, we are committed in our manifesto to replacing the four Trident submarines, and I hope Parliament will be able to endorse the principle of that replacement shortly. Our allies can rest assured that our commitment to NATO and our commitment as a nuclear power to NATO are not altered by the result of the referendum.
Brendan O'Hara (Argyll and Bute) (SNP)
The Secretary of State will be aware that, as the pound plummets against the dollar, the cost of procuring the maritime patrol aircraft and the F-35s we were promised will undoubtedly soar. There will be inevitable consequences for forward procurement, including on the already delayed Type 26 programme. The Government warned that, in the case of a Brexit, there would be swift and savage cuts to the defence budget. Where will that axe fall, and when is it likely to fall? What will the Secretary of State tell our allies at the Warsaw summit, every one of whom was convinced unambiguously that we should remain in the European Union?
Michael Fallon
It is a fact that all the other Defence Ministers around the world were anxious to see us remain in the European Union, but the British people have made their decision. So far as the equipment programme is concerned, we are now negotiating for the maritime patrol aircraft and for the first F-35s to fly off the carriers, and I hope the negotiations will be concluded reasonably soon.
Brendan O'Hara
Scotland faces the very real prospect of being taken out of the European Union against its will. May I remind the Secretary of State of the first page of the 2015 SDSR, which says:
“Economic security goes hand-in-hand with national security”?
The UK’s membership of the European Union was an integral part of our defence policy. It was strategically valuable in promoting the UK’s policies and implementing our defence and security obligations. Given that the Brexiteers have won their referendum and the economy is now in freefall, what plans does the Secretary of State have to review the 2015 SDSR?
Michael Fallon
I am disappointed that the hon. Gentleman should be talking down the British economy, on which so many jobs in Scotland depend. I would caution his party against talking down an economy on which all our constituents depend. Our national security is of course the security of the United Kingdom, including that of Scotland.
Emily Thornberry (Islington South and Finsbury) (Lab)
At what will be my last Defence questions before I take up my new post, may I start by thanking the Secretary of State, and his office, for all the co-operation that he has given in the six months that I have been in this role? Whether it has been, for example, in arranging trips to Army bases or providing briefings on the fight against Daesh, he has been a generous opponent and I regret that I will no longer be his shadow.
At this time, the only thoughts of anyone in this House should be on how we can reassure the British people that we can keep our country safe and secure in the wake of the Brexit vote. We all need to pull together and work together on that, not just within our own parties but across the House as a whole. Will the Secretary of State please reassure us that leaving the EU will not put an end to participation in joint security missions with our European partners? He has mentioned the mission in the Mediterranean, but may I also ask him particularly about the highly successful counter-piracy mission off the Horn of Africa?
Michael Fallon
I am grateful to the hon. Lady for her generous remarks, and I congratulate her on her move. I think the new shadow Defence Secretary is AWOL on his first parade, but we will welcome him and pay tribute to his service in uniform. He will, I note, be the fourth shadow Defence Secretary I have seen in under two years, but I hope he lasts.
Yes, it is very important that we reassure our allies in Europe and around the world that Britain is not turning its back on them. On the contrary, we are still playing a leading role in the world, and that includes work in some of the vital operations in the Mediterranean and off the Horn of Africa, some of which are led by NATO and others of which are led by the European Union.
Emily Thornberry
I thank the Secretary of State for his answer and his generous words. I shall pass on his comments to the new shadow Secretary of State for Defence when he takes up his post this afternoon; they are typical of the way in which he and his office have worked.
One particular concern that many people have is the implications of Brexit for our border controls. What will happen to our border control at Calais, what will happen to the common travel area with Ireland, and will the co-operation we currently receive from our European counterparts in respect of tackling illegal immigration be maintained? How will we go about resolving these issues? Will the armed forces play a role in that, and in what way can we keep our borders safe and secure?
Mr Speaker
My arithmetic may be faulty, but I counted six questions, to which I know the right hon. Gentleman will give a single pithy response, because we must make progress to other hon. Members who also have questions on the Order Paper—something it would have been good to remember earlier.
Michael Fallon
I will do my best, Mr Speaker, noting that the hon. Lady has postponed her defence review because she said it was
“important that the Labour party sticks together and is united”.
I leave it at that.
The Royal Navy will continue to play its part in assisting Border Force and other organisations—the European Union and NATO—in dealing with people smuggling and illegal migration, as the hon. Lady asks.
Margaret Ferrier (Rutherglen and Hamilton West) (SNP)
2. What steps he is taking to mitigate the effect of the extended timetable for construction of Type 26 frigates on maintaining skills in the defence industry.
The Minister for Defence Procurement (Mr Philip Dunne)
This Government are committed to sustaining shipbuilding skills on the Clyde. As we confirmed in the strategic defence and security review last November, we will build two additional offshore patrol vessels before build work starts on the Type 26. This will help sustain shipbuilding skills between the completion of major blocks of the Queen Elizabeth class carriers and commencement of the Type 26 build. That remains the case; the plan has not changed. Over the next decade we will spend about £8 billion on Royal Navy warships.
Margaret Ferrier
As my hon. Friend the Member for Argyll and Bute (Brendan O'Hara) pointed out, the pound is in freefall and every cent it falls against the dollar makes purchasing either the maritime patrol aircraft or the F-35 more expensive. The workers at the Clyde yards have already seen apprenticeship numbers cut by 80%, and the current crisis makes the situation worse. Can the Minister assure me and those on the shop floor in Govan and Scotstoun that the Type 26 programme will begin as soon as possible and not in 2019, as some have suggested?
Mr Dunne
We have already invested £1.6 billion in Type 26, including £472 million this March. I say to the hon. Lady as gently as I can that that commitment could not have been made if her friends had had their way and become independent, because shipbuilding would have ceased two months ago.
Dr Julian Lewis (New Forest East) (Con)
The Minister will remember that previous shipbuilding projects, in particular the carriers and the Type 45 destroyers, ended up being much more expensive because of delays. Does he accept that BAE Systems is ready to start cutting steel on the Type 26 programme relatively soon and that delays will cause our total number of warships to dip and the ones we eventually get to be more expensive?
Mr Dunne
I say to my right hon. Friend, who is knowledgeable about these matters, that this will be one of the largest defence programmes that this Government will enter. I am sure that he will agree that it is absolutely right to enter into a contract once we are confident of the delivery schedule and the ability of the contractors to meet that schedule on a cost-effective basis. Once we are in that position, we will be ready to contract.
Kate Hollern (Blackburn) (Lab)
The Clyde was promised a world-class frigate factory to build 13 new frigates for the UK. However, today we hear that work has been delayed by a year. Thousands of members of staff are on secondment around the country because there is not enough work in the shipyards, and the word “betrayal” rings around those shipyards because no factory has appeared and no work has started.
We have asked in the past for plans for the frigate-building programme, and for promises that all work will be carried out on the Clyde, but those questions have gone unanswered—[Interruption.]
Kate Hollern
When precisely will the Secretary of State present a committed plan to build the new frigates we need, with cast-iron timescales to bring some security to the workforce in Glasgow and around the country, and will leaving the EU affect the building—
Mr Speaker
Thank you very much. A brief response from the Minister and we will move on.
Craig Whittaker (Calder Valley) (Con)
3. What recent discussions he has had with his international counterparts on progress in the campaign against Daesh.
Louise Haigh (Sheffield, Heeley) (Lab)
14. What recent assessment he has made of the progress of the international campaign to defeat ISIS/Daesh.
The Secretary of State for Defence (Michael Fallon)
The next meeting of coalition Defence Ministers will take place on 20 July. The campaign against Daesh is making progress. With coalition support, Iraqi forces now hold Ramadi and Hit, are engaged in clearing Daesh from Fallujah and have begun preparatory operations for retaking Mosul. The Syrian democratic forces are currently conducting operations around Manbij.
Craig Whittaker
Will my right hon. Friend confirm that Britain is playing the second biggest part in the coalition after the United States of America, and that our involvement is making a real difference to the fight against Daesh?
Michael Fallon
I am pleased to confirm that the United Kingdom is playing a significant role in the coalition. The RAF has undertaken more strikes in Iraq and, since December, in Syria than any coalition nation apart from the United States. We now have more than 1,100 service personnel supporting operations in the region, and that is making a real difference to the momentum of the campaign.
Louise Haigh
What assistance are the Government providing to the Jordanian authorities in the light of the recent deterioration in security there, and especially in the light of the recent suicide attack that killed six soldiers outside a refugee camp?
Michael Fallon
We have a very strong defence relationship with Jordan that includes work on training forces together. We will obviously continue to keep that under review, not least because of the pressure on the Jordanian-Syrian border.
Mr Philip Hollobone (Kettering) (Con)
Last week it was reported that US fighter jets were scrambled to intercept Russian bombers attacking American-backed rebels in Syria. What steps is the Secretary of State taking to de-conflict competing allied air forces in the campaign against Daesh?
Michael Fallon
There is a memorandum of understanding between the United States and Russia about the conduct of air operations. We do not co-operate with Russia, but there is a mechanism by which we can avoid that kind of conflict. The easiest way to avoid it would be for Russia to stop assisting the regime and to stop bombing innocent civilians.
Joan Ryan (Enfield North) (Lab)
Opposition activists and Kurdish officials have said that hundreds of Kurds are fleeing Manbij, and that the Syrian defence forces are engaged in clashes there with Daesh. If Manbij is captured, it will be the biggest strategic defeat for Daesh in Syria. Can the Secretary of State comment on the situation, and particularly that of the Kurdish civilians, who are being abducted in their hundreds?
Michael Fallon
They are, and that is why we need to bring this terrible conflict in Syria to an end. Progress is being made by the Syrian Democratic Forces in closing off what is called the Manbij pocket and breaking the supply line between Raqqa and the Turkish border, which restricts the ability of Daesh to trade oil illegally across the border or to recruit foreign fighters the other way. Progress is being made around Manbij, and I hope that one day, when Manbij is recaptured, those same forces can move on towards Raqqa itself.
Andrew Bridgen (North West Leicestershire) (Con)
To carry out its activities, Daesh requires funding. What discussions is my right hon. Friend having with our allies to cut off the funding for Daesh?
Michael Fallon
International efforts are under way to restrict the ability of Daesh to raise money from selling oil, artefacts or anything else, or to access other funding on the international markets. That is work that requires co-operation right across the coalition, and it is work in which the United Kingdom is playing a leading part.
Mr George Howarth (Knowsley) (Lab)
While we have been otherwise preoccupied, the atrocities that have been carried out by Daesh over the last few weeks remain deeply worrying. Will the Secretary of State give an undertaking that he will co-operate through NATO bilaterally with other European allies and take strategic action unilaterally to make sure that everything possible is done to try to stop these appalling atrocities?
Michael Fallon
Yes, we are facing a most barbarous enemy, which is not simply torturing and killing innocent civilians in Syria and Iraq, but still poses a very direct threat to us here in western Europe—on the first anniversary of the slaughter of 30 of our subjects in Sousse by an equivalent extremist. Whether it is through the international coalition, through the use of NATO assets or through other bilateral frameworks, let me reassure the right hon. Gentleman that we are absolutely committed to this fight and to the eventual defeat and degradation of Daesh.
Caroline Ansell (Eastbourne) (Con)
4. What assessment he has made of the viability of alternatives to a continuous at-sea nuclear deterrent for protecting national security.
The Secretary of State for Defence (Michael Fallon)
The 2013 Trident alternatives review considered alternative systems and postures for the United Kingdom’s nuclear deterrent and concluded that no alternative is as capable, or offers the same degree of resilience, as continuous at-sea deterrence.
Caroline Ansell
Some have expressed concern that with advancing technology, our submarines can now be detected and discovered by underwater drones. Can my right hon. Friend assure me that that is not the case?
Michael Fallon
Yes, we are confident that our submarine fleet remains safe and secure. We devote considerable resources to assessing capabilities and new technologies that could threaten the operation of our deterrent, including potential threats from the development of cyber and unmanned underwater vehicles. I am happy to reassure my hon. Friend on precisely that point.
John Woodcock (Barrow and Furness) (Lab/Co-op)
Whoever stands at the Opposition Dispatch Box or at the Government’s, there is a cast iron majority in the House to do the right thing by Trident’s successor and to reach outwards to defend our nation, rather than to turn inwards. Will the vote still happen before the summer recess?
Michael Fallon
I am grateful to the hon. Gentleman for what he has said. There is clearly a majority—[Interruption.] There are those who are opposed in principle, but there is clearly such a majority in this House. I believe that it is right that this House should vote on the principle of the renewal of the deterrent, and I very much hope that he will not have too much longer to wait.
Douglas Chapman (Dunfermline and West Fife) (SNP)
With the Type 26 frigates well behind schedule, it has been said that the Navy has “run out of money” to progress these contracts. Given the perilous state of the economy since Friday morning, will the Secretary of State give us an assurance that we will—please, please—run out of money for Trident as well?
Michael Fallon
The schedule for the Type 26s has not yet been set. These ships are likely to cost between £500 million and £1 billion each, and I will not sign a contract for these ships until I am satisfied that they represent good value for the Royal Navy and good value for the taxpayer.
Kirsten Oswald (East Renfrewshire) (SNP)
5. What steps he is taking to promote the welfare of armed forces personnel.
The Parliamentary Under-Secretary of State for Defence (Mr Julian Brazier)
In January, the Department published the first ever armed forces families strategy, embracing seven key themes—partner employment, accommodation, children’s education and childcare, community support, specialist support, health and wellbeing, and transition. We have reviewed our casualty and compassionate processes, and this autumn we are introducing a pilot for a new welfare scheme for reservists. We continue to work to ensure that our armed forces and their families are treated fairly through the covenant.
Kirsten Oswald
Economic and military security assurances, as laid out in the strategic defence and security review, have been significantly weakened by the events of the last week, and this could not have come at a worse time for armed forces personnel. To give just two examples—
Mr Speaker
Order. I am awfully sorry, but we have not got time for two examples. I need a single, short supplementary question, with a question mark at the end.
Kirsten Oswald
The armed forces satisfaction survey has caused considerable concern in this regard. Does the Minister agree that the continuing welfare of our personnel should be the priority at this tumultuous time?
Mr Brazier
The short answer is yes. The huge number of local authorities, companies and other parts of the nation that have signed up to the armed forces covenant shows that the country as a whole is responding with a resounding yes.
Christina Rees (Neath) (Lab)
17. I have been working with Neath veterans support group to ensure that those leaving the armed forces receive the support they need. Will the Minister explain what his Government are doing to extend the support offered, through projects such as Change Step, so that the welfare of serving personnel is viewed through a model of prevention, rather than of cure?
Mr Brazier
I am grateful to a whole range of charities in Neath and other areas for the work they are doing with the armed forces. We are giving considerable priority to this and to ensuring that people’s transition, which is one of the seven aspects of the strategy I have mentioned, is successful. From the stories one hears of companies that have signed covenants successfully taking on people for new careers after they leave the armed forces and of the work we are doing with local authorities on housing, I can say that all this work is bearing fruit.
Lucy Frazer (South East Cambridgeshire) (Con)
6. What estimate he has made of the projected increase in defence spending during this Parliament.
Daniel Kawczynski (Shrewsbury and Atcham) (Con)
7. What estimate he has made of the projected increase in defence spending during this Parliament.
The Minister for Defence Procurement (Mr Philip Dunne)
I will answer pithily. This Government are delivering stronger defence. The defence budget will rise by 0.5% above inflation every year to 2020-21, and we will access up to £1.5 billion a year from the joint security fund by the end of this Parliament. This is the first time in six years that the defence budget will increase in real terms.
Lucy Frazer
Given the vote last week, does the Minister agree that Britain should remain a key player on the international stage? Will Britain continue to use its influence to encourage our NATO allies to spend 2% of their GDP on defence?
Mr Dunne
As my right hon. Friend the Secretary of State said earlier, NATO is the cornerstone of our defence, and we are leading players in influencing fellow NATO members to meet the spending commitment. Allies have made welcome progress since 2014; five now spend 2% of GDP on defence, eight spend 20% of their defence budgets on major equipment and research, 16 have increased defence spending in real terms and 24 are now spending more of their defence budgets on equipment.
Daniel Kawczynski
With the increasing budget comes increasing responsibility for ensuring value for money for taxpayers. Has my hon. Friend learned the lessons of failed procurement under Labour of maritime patrol aircraft, which had to be cancelled because the programme was 10 years behind and £800 million over budget?
Mr Dunne
My hon. Friend and constituency neighbour is right that the Nimrod programme suffered repeated and unacceptable delays and cost overruns. The decision in 2010 to cancel it was difficult but the planned purchase of nine P-8 Poseidon aircraft for maritime patrol will give us the capability we need in the timeframe we want, and at best value for the taxpayer.
Caroline Flint (Don Valley) (Lab)
Part of making sure defence spending is adequate is making sure that we get value for money. The Public Accounts Committee was very disturbed when we looked recently at housing management for service families, which seems to be woeful. The contractor, Carillion, has not stepped up to the job. Will the Minister tell me how he will ensure that we get value for money and, more importantly, a better service for our service families?
Mr Dunne
I am pleased to confirm to the right hon. Lady that in the area of defence equipment procurement, for which I am responsible, the Public Accounts Committee has found that we have consistently brought programmes in within budget and with minimal time overruns. I accept we have more to do on housing.
Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)
Where the defence budget is spent is absolutely crucial. Given the gross uncertainty for the British steel industry as a result of the EU referendum vote, what assurances on defence spending can the Minister give to steel manufacturers in this country to boost them at this crucial time?
Mr Dunne
We have adopted the Government’s policy to ensure that defence contractors make all steel procurement opportunities available to UK producers. The amount of steel expected to be available for tender for future work is much reduced, because the most substantial amounts have been in the aircraft carrier programme and we will not be building vessels as big as that for the foreseeable future.
Sir Gerald Howarth (Aldershot) (Con)
I warmly welcome the Government’s commitment to spend at least 2% of GDP on defence, but will my hon. Friend confirm that this year and next there will be no increase in cash terms, and assure me that we will not find ourselves in the same situation as we did this year, where in order to meet our 2% commitment money was transferred to the Ministry of Defence from other Departments?
Emily Thornberry (Islington South and Finsbury) (Lab)
There has been much loose talk about the increase in the defence budget, but to be able to hit the target of 2% of GDP we now have to be very careful, as there may well be a recession given the Brexit vote. Will the Minister reassure the House, the public and the armed forces that the Government’s commitment on defence spending will be maintained not just in terms of GDP but in cash terms?
Chris Stephens (Glasgow South West) (SNP)
8. What progress has been made on his Department’s naval procurement plans.
The Minister for Defence Procurement (Mr Philip Dunne)
The Department continues to develop our naval force structure, as we set out in the defence review. That will include completion of two new Queen Elizabeth class aircraft carriers, eight Type 26 global combat ships, new solid support ships and two new offshore patrol vessels.
Chris Stephens
Can the Minister confirm press reports today that leaked correspondence shows that the Ministry of Defence is looking for savings of £500 million in the Type 26 programme, and has refused an offer from BAE Systems that would bring savings of £270 million while starting the programme on time?
Mr Kevan Jones (North Durham) (Lab)
After last week’s vote, these are uncertain times for UK manufacturing. One thing that the Government could do now to boost manufacturing and protect British jobs and skills would be to make a decision on Successor and bring it forward. Will the Minister say when that vote will be?
Martin Docherty-Hughes (West Dunbartonshire) (SNP)
9. What discussions he has had with his Cabinet colleagues on preparations for the NATO Warsaw summit.
The Secretary of State for Defence (Michael Fallon)
The National Security Council has considered the UK’s preparations for the Warsaw summit next week, which is an opportunity to build on the success of the summit that we hosted in Wales in 2014. Our intention at Warsaw is to demonstrate a united alliance that is adaptable, transparent, and capable of planning for and responding to the full range of threats that we face today.
Martin Docherty-Hughes
Today the United Kingdom is seen as an ineffective, unreliable partner in global affairs, as highlighted not by Opposition Members, but by a former general and supreme commander of NATO, Admiral Stavridis. Reflecting on the admiral’s words, what does the Secretary of State think that his Government can achieve in Warsaw?
Michael Fallon
I hope that we can further reassure NATO members on the eastern flank that we stand by our commitment in the face of Russian aggression. I hope that we continue to make the alliance more flexible to deal with the new threats we face, particularly from cyber and hybrid warfare, and that through British leadership we will encourage other allies to meet the 2% commitment that we are already meeting this year.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
I hope the Secretary of State is aware that we cannot hide behind the fig leaf of a percentage of GDP, and that we need NATO membership and partnership more than ever before, given last Thursday’s dreadful result in the referendum. We have only 100,000 people in our defence forces—we could get them all in Wembley. Let us have a stronger NATO and a greater partnership against Russia with Europe.
Michael Fallon
We have more than 100,000 members in our armed forces, but I agree with the hon. Gentleman about the importance of NATO. Because we are withdrawing from the European Union, it will be all the more important to reinforce our commitment to NATO and the obligations of NATO membership. That is why we lead in complying with the 2% commitment, and he will hear from the Warsaw summit about additional deployments that we are now likely to make to the eastern flank.
Stephen Gethins (North East Fife) (SNP)
10. What recent assessment his Department has made of the security situation in Libya.
The Secretary of State for Defence (Michael Fallon)
Forces aligned to the Libyan Government of National Accord are making progress against Daesh, but while Daesh may have suffered setbacks in its stronghold in Sirte and in the east, it has not yet been defeated and may look to re-establish itself elsewhere in Libya. In Tripoli, the security situation is relatively calm but fragile, with increasing support for the Presidency Council from militias.
Stephen Gethins
Before last Friday morning, Libya was seen as this Government’s worst foreign policy disaster. In light of that, will the Secretary of State say what discussions he has had with EU counterparts about continued involvement in Operation Sophia off the coast of Libya?
Michael Fallon
I continue to discuss Operation Sophia with my European counterparts, and we have agreed to deploy an additional vessel, a Royal Navy ship, as part of that. We are working with the new Libyan Government —I recently spoke to the Defence Minister there—to support them in their fight against Daesh. It is vital that we continue to work with other allies along the coastline, and we are extending the counter-IED training that we provide to Tunisian forces for a further year.
Chris Heaton-Harris (Daventry) (Con)
13. What steps he is taking to increase the proportion of defence spending that goes to small firms.
The Minister for Defence Procurement (Mr Philip Dunne)
Small businesses are a crucial engine for growth and innovation in this country, and we are determined that they should play an increasing part in supplying defence. We are committed to achieving 25% of our procurement spend with small and medium-sized enterprises by 2020, and that target is 10% higher than the one set during the last Parliament. We recently refreshed our SME policy to show how we will work to achieve that.
Chris Heaton-Harris
What steps is my hon. Friend taking to make it as simple as possible for small firms to benefit from this increased spend?
Ian Murray (Edinburgh South) (Lab)
I should maybe come to questions more often.
A former First Sea Lord told the Defence Committee that the delay in the Type 26 frigate programme was due to money problems in the Ministry of Defence budget. Will the Minister tell the House, and more importantly tell the workers on the Clyde, how many jobs will be lost and what the impact will be on its world-class apprenticeship programme?
Andy Slaughter (Hammersmith) (Lab)
15. Whether the Government plan to publish a policy on the use of drones for targeted killing.
The Minister for the Armed Forces (Penny Mordaunt)
With regard to targeting or other rules of engagement, the use of remotely piloted air systems is no different to that of any other aircraft. Therefore, there is no separate policy for their use in this respect.
Andy Slaughter
With respect, it is evident that the Government intend to use lethal force outside armed conflict for counter-terrorism purposes, despite the legal basis for that being unclear. Will the Government clarify the legal basis on the use of drones for targeted killing outside of armed conflict?
Penny Mordaunt
We have been very clear that this is guided by international law. Where there is an identified, direct and immediate threat to the United Kingdom, and where we have no other means of dealing with it, we reserve the right to use force.
Mr Speaker
The hon. Member for Sittingbourne and Sheppey (Gordon Henderson) has a question on the Order Paper on this very same subject. Does he wish to intervene and give the House the benefit of his thoughts?
Ronnie Cowan (Inverclyde) (SNP)
T1. If he will make a statement on his departmental responsibilities.
The Secretary of State for Defence (Michael Fallon)
My immediate priorities remain success in our operations against Daesh, and implementing our strategic defence and security review commitments. On Friday week, I will join the Prime Minister for the NATO summit in Warsaw, where we will review progress since the Wales summit, agree further reassurance to our eastern allies, and take further steps to demonstrate the alliance’s strength and unity.
Ronnie Cowan
Given the unfortunate success of the Brexit campaign and the subsequent downward spiral of the value of the pound, which now sits at a 31-year low, will the Minister tell me the additional cost of the Trident renewal programme on top of the current estimate of £205 billion?
Michael Fallon
In the strategic defence and security review, we published our most up-to-date assessment of the cost of the Trident replacement programme at £31 billion, plus a contingency of a further £10 billion.
Craig Whittaker (Calder Valley) (Con)
T3. In the light of the momentous decision taken by the nation last Thursday, will the Minister explain to the House what implications that decision will have on working with military intelligence from not only European countries but other countries around the world?
The Minister for the Armed Forces (Penny Mordaunt)
Defence in the UK is grounded on the strength of our relationships with our closest allies and partners. We work extensively with them, principally through NATO but also bilaterally. The UK’s decision to leave the European Union does not change that approach.
Rachael Maskell (York Central) (Lab/Co-op)
In the first year of this Government, over 1,800 properties within the married quarters estate were left empty for the majority of the year. Since then, the number has more than quadrupled. Can the Minister explain why that has been allowed to happen and why the properties are not being used?
The Parliamentary Under-Secretary of State for Defence (Mark Lancaster)
My understanding is that there are just over 10,000 void properties at the moment under the service family accommodation estate. We need to have void properties to ensure that when people trickle post they have a property to go to. Equally, the hon. Lady will be aware that we are moving the Army back from Germany at the moment so we need spare properties, but up to half of those properties are currently up for disposal.
Rachael Maskell
The fact is that departmental policy is for about 10% of such properties to remain vacant. In fact, there are more than 20%. The reality is that there is such a high proportion of empty properties because they are not in a fit state for people to live in. They cannot be released for sale by the leaseholder, Annington Homes, because it would cost too much for the Government to repair. The taxpayer is having to spend more than £30 million every year for the MOD to rent these properties. Will the Minister explain why his Department is wasting £30 million?
Mark Lancaster
I am not sure whether the hon. Lady heard my answer. It is not every year that we seek to bring back the Army from Germany, which is why we need extra properties. However, more than half the properties are currently up for disposal and we have also invested more than £200 million in building 1,200 new service family accommodation units to ensure that we get the best quality accommodation for our troops.
Karl MᶜCartney (Lincoln) (Con)
T4. While I welcome the recent announcement that Lincolnshire will still have an air show—now at RAF Scampton—what steps is my hon. Friend taking to increase home ownership among members of the armed forces?
Mark Lancaster
I am delighted to say that since the forces’ Help to Buy scheme was introduced, more than 7,260 service families have taken up the opportunity to buy their own home.
Mr David Hanson (Delyn) (Lab)
T2. Will the Minister undertake an urgent review of the awards of the Légion d’Honneur? I have many constituents who were awarded the Légion d’Honneur by the French authorities and who notified the Ministry of Defence more than a year ago, but have still not received their medals. Will the Minister look at that urgently?
Mark Lancaster
I am more than happy to do so. The right hon. Gentleman will be aware that there was a review. It is fair to say that the French authorities have simply been overwhelmed by the number of applications, but we have a system in place now whereby 200 are sent each week to the French. Of the original applications that were made, I understand that all have now been awarded.[Official Report, 28 June 2016, Vol. 612, c. 1MC.]
Stephen Phillips (Sleaford and North Hykeham) (Con)
T6. My hon. Friend will be aware of the valuable and essential work done by African Union troops to prevent and ameliorate conflicts all over Africa—work that is also essential for this country. Will she update the House on the support being provided to the AU by the UK to assist with its peacekeeping role?
Penny Mordaunt
My hon. and learned Friend affords me the opportunity to pay tribute to our armed forces who are training the Rwandan defence force as well as the African Union’s Eastern Africa Standby Force. The training that we are providing is there to help security sector reform and enhance their capabilities for peace operations and disaster relief.
Deidre Brock (Edinburgh North and Leith) (SNP)
T5. Following the questioning of Ministry of Defence officials at the Public Accounts Committee on infantry management, will the Minister tell us about the current state of the logistics commodities and services’ transformation programme? Is the super shed built, and how confident are the Government that the privatisation of logistics to support our armed services will not result in equipment shortages on the ground?
The Minister for Defence Procurement (Mr Philip Dunne)
I can confirm that the new MOD Donnington facility will be completed on schedule before the end of the year.
Mark Spencer (Sherwood) (Con)
T7. Will the Department update the House on the progress being made in increasing the number of cadet units in state schools so that more young people can benefit from the skills and experiences of those cadet units?
The Parliamentary Under-Secretary of State for Defence (Mr Julian Brazier)
We are receiving a healthy number of applications to set up new units. These are processed through a six-monthly run. Twenty five new state school units have been approved since last November, and 350 school cadet units are currently parading. The programme is on track to achieve its target of 500 in schools by 2020.
Ian Austin (Dudley North) (Lab)
T9. Thousands of Kurdish peshmerga killed or seriously injured fighting Daesh could have been helped by good front-line facilities. Can we now rush in a field hospital to reduce avoidable deaths and allow at least 100 of the most seriously injured to benefit from specialist beds here in the UK? It is the least we can do.
Penny Mordaunt
We have done a huge amount to support Kurdish fighters. To date, we have trained 3,900 and that includes not just dealing with improvised explosive devices, but providing first aid and that first-line medical support.
Christopher Pincher (Tamworth) (Con)
T10. On Saturday, I met my constituent Benjamin Greaves who was injured by a thunder flash in 1979, but whose injury was not diagnosed until 2011. Will Ministers look at his case to ensure that he is receiving all the compensation and pension that he deserves?
Mark Lancaster
I shall of course be delighted to look at the case and may I suggest that we meet?
Mrs Madeleine Moon (Bridgend) (Lab)
What percentage of the P-8 contracts will be offset to British companies and what maintenance work will take place in the UK? Will the Minister confirm that the sonobuoys and missiles will be procured from British companies?
Jack Lopresti (Filton and Bradley Stoke) (Con)
Will my hon. Friend assure us that, despite Airbus trying to bully its employees to vote remain in the referendum last week, the wings of the magnificent A400 aircraft will still be made in Filton?
Alison McGovern (Wirral South) (Lab)
Depressingly, UNICEF reported that 25 children were killed by airstrikes in Syria yesterday. Will the Secretary of State tell us what conversations he is having with our international partners to make sure that we take every necessary step to defend civilians?
Penny Mordaunt
The hon. Lady raises an important point. On that operation to date, we know that UK strikes have produced no reports of civilian casualties. That is because of the care we take and the investigations we carry out after every strike. We are working with our allies to develop joint policy in this area.
Mr Speaker
The hon. Lady will be delighted to receive such an exultant welcome!
Dr Mathias
Thank you, Mr Speaker.
The Royal Military School of Music has been in Whitton for 150 years. Will the Minister work with me to ensure that the Ministry of Defence keeps a physical military presence “remaining” in Whitton?
Mark Lancaster
I commend my hon. Friend, whose constituents could not ask for a greater champion on this issue. Since last month’s Adjournment debate, the situation has not changed. However, I am convinced that we will continue to have military concerts there in the future.
Ann Clwyd (Cynon Valley) (Lab)
Exactly what actions are the Government taking to protest about the use of phosphorous bombs and barrel bombs against the people of Aleppo?
James Heappey (Wells) (Con)
I was grateful for the Minister’s earlier answer on the cadet expansion programme. Will he tell us at what point, if at all, expressions of interest from schools in non-priority areas will be accepted if insufficient applications are made from priority areas?
Mr Brazier
My hon. Friend reflects on the problems of success. We have many applications from priority areas, according to the three criteria that were set out a number of times. I cannot make any firm promises, I am afraid, for those who do not meet the priority criteria. We are firmly on track to deliver the schools we need.
Michael Dugher (Barnsley East) (Lab)
Last Friday, I was privileged to be invited to Burma company 4th Battalion The Yorkshire Regiment, based in Barnsley, to thank them for the service ahead of armed forces day. Will the Secretary of State join me in paying tribute to the superb men and women there, who are superbly led by Major Darren Schofield?
Michael Fallon
Let me congratulate all those from the armed forces, including those from reserve units, who participated in the key events in Cleethorpes, Plymouth, Glasgow, Woolwich and many other locations up and down the country. We are proud of them, and we gave the public the opportunity to show their support.
Andrew Bridgen (North West Leicestershire) (Con)
Will the Secretary of State reassure us that, by contrast with the Labour party, morale in our armed forces remains high and the desertion rate is very low?
Penny Mordaunt
I am happy to confirm, on the basis of the attitude surveys that we conduct each year, that morale is high, and the armed forces appreciate that, given a defence budget that is growing every single year, they have much to look forward to.
Greg Mulholland (Leeds North West) (LD)
I thank the veterans Minister for taking account of the plight of war widows who have been penalised for remarrying. Can he give us some idea of how long his review of the matter will take?
Mark Lancaster
I hope to be able to get back to the House and the hon. Gentleman as soon as possible.
NEW MEMBER
Outcome of the EU Referendum
(8 years, 5 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Prime Minister (Mr David Cameron)
With permission, Mr Speaker, I will make a statement on the result of the EU referendum.
Last week saw one of the biggest democratic exercises in our history, with more than 33 million people from England, Scotland, Wales, Northern Ireland and Gibraltar all having their say. We should be proud of our parliamentary democracy, but it is right that, when we consider questions of this magnitude, we do not just leave it to politicians but listen directly to the people. That is why Members on both sides of the House voted for a referendum by a margin of six to one.
As I have mentioned the House, let me welcome the new hon. Member for Tooting (Rosena Allin-Khan). I advise her to keep her mobile phone turned on: she might be in the shadow Cabinet by the end of the day. [Laughter.] And I thought I was having a bad day.
Let me set out for the House what this vote means, the steps we are taking immediately to stabilise the UK economy, the preparatory work for the negotiation to leave the EU, our plans for fully engaging the devolved Administrations, and the next steps at tomorrow's European Council.
The British people have voted to leave the European Union. It was not the result that I wanted, or the outcome that I believe is best for the country I love, but there can be no doubt about the result. Of course, I do not take back what I said about the risks. It is going to be difficult. We have already seen that there are going to be adjustments within our economy, complex constitutional issues, and a challenging new negotiation to undertake with Europe. However, I am clear—and the Cabinet agreed this morning—that the decision must be accepted, and the process of implementing the decision in the best possible way must now begin.
At the same time, we have a fundamental responsibility to bring our country together. In the past few days, we have seen despicable graffiti daubed on a Polish community centre, and verbal abuse hurled against individuals because they are members of ethnic minorities. Let us remember that these people have come here and made a wonderful contribution to our country. We will not stand for hate crime or attacks of this kind. They must be stamped out.
We can reassure European citizens living here, and Brits living in European countries, that there will be no immediate changes in their circumstances; nor will there be any initial change in the way our people can travel, the way our goods can move, or the way our services can be sold. The deal we negotiated at the European Council in February will now be discarded and a new negotiation to leave the EU will begin under a new Prime Minister.
Turning to our economy, it is clear that markets are volatile and that some companies are considering their investments; we know that this is going to be far from plain sailing. However, we should take confidence from the fact that Britain is ready to confront what the future holds for us from a position of strength. As a result of our long-term plan, we have today one of the strongest major advanced economies in the world, and we are well placed to face the challenges ahead. We have low, stable inflation. The employment rate remains the highest it has ever been. The budget deficit is down from 11% of national income and forecast to be below 3% this year. The financial system is also substantially more resilient than it was six years ago, with capital requirements for the largest banks now 10 times higher than before the banking crisis.
The markets may not have been expecting the referendum result but, as the Chancellor set out this morning, the Treasury, the Bank of England and our other financial authorities have spent the last few months putting in place robust contingency plans. As the Governor of the Bank of England said on Friday, the Bank’s stress tests have shown that UK institutions have enough capital and liquidity reserves to withstand a scenario more severe than the one the country currently faces; and the Bank can make available £250 billion of additional funds if it needs to support banks and markets. In the coming days, the Treasury, the Bank of England and the Financial Conduct Authority will continue to be in very close contact. They have contingency plans in place to maintain financial stability and they will not hesitate to take further measures if required.
Turning to preparations for negotiating our exit from the EU, the Cabinet met this morning and agreed the creation of a new EU unit in Whitehall. This will bring together officials and policy expertise from across the Cabinet Office, the Treasury, the Foreign Office and the Business Department. Clearly this will be the most complex and most important task that the British civil service has undertaken in decades, so the new unit will sit at the heart of government and be led and staffed by the best and brightest from across our civil service. It will report to the whole Cabinet on delivering the outcome of the referendum, advising on transitional issues and objectively exploring options for our future relationship with Europe and the rest of the world from outside the EU. It will also be responsible for ensuring that the new Prime Minister has the best possible advice from the moment of their arrival.
I know that colleagues on all sides of the House will want to contribute to how we prepare and execute the new negotiation to leave the EU, and the Chancellor of the Duchy of Lancaster, my right hon. Friend the Member for West Dorset (Mr Letwin), will listen to all views and representations and make sure that they are fully put into this exercise. He will be playing no part in the leadership election.
Turning to the devolved Administrations, we must ensure that the interests of all parts of our United Kingdom are protected and advanced, so as we prepare for a new negotiation with the European Union we will fully involve the Scottish, Welsh and Northern Ireland Governments. We will also consult Gibraltar, the Crown dependencies and overseas territories, and all regional centres of power including the London Assembly. I have spoken to the First Ministers of Scotland and Wales, as well as the First and Deputy First Ministers in Northern Ireland and the Taoiseach, and our officials will be working intensively together over the coming weeks to bring our devolved Administrations into the process for determining the decisions that need to be taken. While all the key decisions will have to wait for the arrival of the new Prime Minister, there is a lot of work that can be started now. For instance, the British and Irish Governments begin meeting this week to work through the challenges relating to the common border area.
Tomorrow I will attend the European Council. In the last few days I have spoken to Chancellor Merkel, President Hollande and a number of other European leaders. We have discussed the need to prepare for the negotiations and in particular the fact that the British Government will not be triggering article 50 at this stage. Before we do that, we need to determine the kind of relationship we want with the EU, and that is rightly something for the next Prime Minister and their Cabinet to decide. I have also made this point to the Presidents of the European Council and the European Commission, and I will make it clear again at the European Council tomorrow. This is our sovereign decision and it will be for Britain, and Britain alone, to take.
Tomorrow will also provide an opportunity to make the point that although Britain is leaving the European Union, we must not turn our back on Europe or on the rest of the world. The nature of the relationship we secure with the EU will be determined by the next Government, but I think everyone is agreed that we will want the strongest possible economic links with our European neighbours, as well as with our close friends in North America and the Commonwealth and with important partners such as India and China. I am also sure that whatever the precise nature of our future relationship, we will want to continue with a great deal of our extensive security co-operation and to do all we can to influence decisions that will affect the prosperity and safety of our people here at home.
This negotiation will require strong, determined, and committed leadership. As I have said, I think the country requires a new Prime Minister and Cabinet to take it in this direction. This is not a decision I have taken lightly, but I am absolutely convinced that it is in the national interest. Although leaving the EU was not the path I recommended, I am the first to praise our incredible strengths as a country. As we proceed with implementing this decision and facing the challenges that it will undoubtedly bring, I believe we should hold fast to a vision of Britain that wants to be respected abroad, tolerant at home, engaged in the world and working with our international partners to advance the prosperity and security of our nation for generations to come. I have fought for these things every day of my political life and I will always do so. I commend this statement to the House.
Jeremy Corbyn (Islington North) (Lab)
First, I thank the British people for turning out to vote in the referendum in such high numbers. The vote was a reflection of the significance of the issue, but it was a close vote on the back of a campaign that was too often divisive and negative. The Opposition Benches put forward a positive case to remain part of the European Union and convinced more than two thirds of our own supporters, but the majority of people voted to leave and we have listened to and accepted what they have said. Many people feel disfranchised and powerless, especially in parts of the country that have been left behind for far too long—communities that have been let down not by the European Union but by Tory Governments. Those communities do not trust politicians to deliver, because for too long they have not. Instead of more extreme cuts to local services, which have hit those areas the hardest, the Government need to invest in those communities. Many such areas are deeply concerned about the security of pledged EU funding. That money is desperately needed, so can the Prime Minister give us any guarantees on those issues?
Secondly, there is the issue of trust. The tenor of the referendum was disheartening. Half-truths and untruths were told, many of which key leave figures spent the weekend distancing themselves from—not least the claim that a vote to leave would hand the NHS an extra £350 million a week. It is quite shameful that politicians made claims they knew to be false and promises they knew could not be delivered.
Thirdly, real concern exists about immigration, but too much of the discussion during the referendum campaign was intemperate and divisive. In the days following the result, it appears that we have seen a rise in racist incidents, such as the attack on the Polish centre in Hammersmith, to which the Prime Minister quite rightly referred, and sadly many other such incidents all over this country. I hope that the Prime Minister and the Home Secretary will take all the action they can to halt the attacks and halt this disgraceful racist behaviour on the streets of this country.
As political leaders, we have a duty to calm our language and our tone, especially after the shocking events of 10 days ago. Our country is divided, and the country will thank neither the Government Benches in front of me nor the Opposition Benches behind for indulging in internal factional manoeuvring at this time. We have serious matters to discuss in this House and in the country—[Interruption.]
Mr Speaker
Order. I want to accommodate as many as possible of those colleagues who wish to question the Prime Minister. Matters are just slowed up if people make a lot of noise. I have plenty of time; I do not know whether other people have.
Jeremy Corbyn
Thank you, Mr Speaker. It does appear that neither wing of the Tory Government has an exit plan, which is why we are insisting that the Labour party be fully engaged in the negotiations that lie ahead. We need the freedom to shape our economy for the future and protect social and employment rights, while building new policies on trade, migration, environmental protection and investment.
I fully understand that the Prime Minister is standing down in three months’ time, but we cannot be in a state of paralysis until then. He is meeting the European Council tomorrow, and I hope he will say that negotiations will begin, so that we know what is going on, rather than being delayed until October. We, as a House, have a duty to act in the national interest and ensure we get the best agreements for our constituents. Will the Prime Minister today confirm that, in the light of the economic turmoil, the Chancellor will announce at least a suspension—preferably, the termination—of his now even more counterproductive fiscal rule? What the economy needs now is a clear plan for investment, particularly in those communities that have been so damaged by this Government and that have sent such a very strong message to all of us last week. Will he specifically rule out tax rises or further cuts to public services, which were threatened pre-referendum?
I welcome the Prime Minister’s reassurances on the uncertainty felt by many EU nationals currently working in our economy, including the 52,000 who work so well to help our national health service provide the service we all need. It is welcome that the Prime Minister is consulting the leaders of the devolved Administrations, and I hope he will also be consulting the Mayor of London, a city for which the implications are huge. We must act in the public interest and support measures to reduce volatility. I welcome market protections, but what about protections for people’s jobs, wages and pensions? Can the Prime Minister make clear what plans are in place? The Chancellor spoke this morning to reassure the stock markets, though they clearly remain very uncertain. We understand that some measures cannot be discussed in the House, so will the Prime Minister give me an assurance that the Chancellor will provide private briefings to his opposite numbers on this matter?
Finally, on a personal note, may I say that although I have many fundamental disagreements with the policies of the Prime Minister and his Governments, as he announces the end of his premiership it is right to reflect that he led a Government that delivered equal marriage, against the majority of his own MPs, and he was right to do so. I want to thank him, too, for his response to the Bloody Sunday inquiry and how he reacted to the tragic murder of Jo Cox. We thank him for his service, although I am sure we will enjoy many more debates and disagreements while he continues as Prime Minister.
The Prime Minister
Let me agree with the Leader of the Opposition that it was positive that turnout was so high. I also agree with him that we need to reach out to those people who have not benefited from economic growth and make sure that they feel that their economic security is important to us as well. But I do not agree with him that it is right to start to try to refight the campaign all over again. All I know for my part is that I put everything I could into the campaign that I believed in—head, heart and soul—and I left nothing out, and I think that was the right thing to do.
Let me answer the right hon. Gentleman’s questions. On money that different areas of the country get, until we leave the EU none of those arrangements change; so what has been set out in the Budget, and payments and the rest of it, all continue. But as the negotiation begins properly for leaving, the next Government will want to set out what arrangements they will put in place for farmers, for local authorities and for regions of our country.
On intolerance and fighting intolerance, I absolutely agree with the right hon. Gentleman that we must take all action we can to stamp this out. He asked about the Chancellor’s fiscal rule and future plans. What I would say is that we have not worked so hard to get the budget deficit from 11% down to below 3% just to see that go to waste, and we must continue to make sure that we have a sound and strong economic plan in our country. For the coming months that is my responsibility and the Chancellor’s responsibility, but in time it will be the responsibility of a new Government, and they will have to decide how to react if there are economic difficulties along the way.
The right hon. Gentleman asked whether there could be private briefings for members of the shadow Front-Bench team with the Chancellor of the Exchequer. As always in these arrangements, if shadow Cabinet members want those sorts of briefings, they can have them.
Finally, I thank the right hon. Gentleman for his kind remarks and the fact that he hopes we will be debating with each other for some weeks and possibly months to come.
Mr Kenneth Clarke (Rushcliffe) (Con)
When we acquire a new Government who have decided what they mean by leaving and draw up some detailed policy instructions for the committee of officials the Prime Minister has set up, a great deal of detailed legislation covering a whole variety of fields will be submitted to this Parliament. Does my right hon. Friend agree that we still have a parliamentary democracy and it would be the duty of each Member of Parliament to judge each measure in the light of what each man and woman regards as the national interest, and not to take broad guidance from a plebiscite which has produced a small majority on a broad question after a bad-tempered and ill-informed debate? [Interruption.] And does he agree that we will face months of uncertainty if we are not careful—[Interruption.]
Mr Speaker
Order. It is not acceptable for people to make that level of noise. The right hon. and learned Gentleman will be heard and every Member of this House will be heard. Let us accord the right hon. and learned Gentleman the respect to which he is entitled.
Mr Clarke
Thank you, Mr Speaker.
Does my right hon. Friend agree that, as there is a risk of uncertainty for a few months, causing very considerable difficulty, he should consider the possible first step of joining the European economic area, which was designed in the first place for countries like Norway and Iceland, where the great bulk of politicians wished to join the European Union but could not get past the ridiculous hurdle of a referendum in order to get there? That could at least be negotiated, with modifications and changes if anybody can decide what they want once we get to that point, and it would give some reassuring order and stability to our economy and might begin to attract a little investment and future prospects for our country.
The Prime Minister
I thank my right hon. and learned Friend for his remarks. My view is simple: this House should not block the will of the British people to leave the European Union, but of course we have now got to look at all the detailed arrangements, and Parliament will clearly have a role in that in making sure that we find the best way forward. That will be principally the job for the next Government, but I do believe in parliamentary sovereignty and the sovereignty of this Parliament. A lot of detail will have to be discussed and debated, but decisions such as whether or not to join the EEA must be for a future Government.
Angus Robertson (Moray) (SNP)
Scotland voted overwhelmingly to remain in the European Union. Sixty-two per cent. of voters cast their votes to remain in the EU, and every single local government area in the country voted to remain in the EU. In Scotland we voted to remain because it really matters that we are in the single European market, because we value the free movement of people, goods and services, and because our EU citizenship rights matter, as do our legal safeguards for workers, for women and for parents. In Scotland we voted to remain because we are a European nation, and it really matters to us that we live in an outward-looking country, not a diminished little Britain.
In Scotland we are now being told from Westminster that despite the majority against leave, we are going to have to do as we are told: we are going to be taken out of Europe against our will. Mr Speaker, let me tell this House and our friends across Europe: we have no intention whatsoever of seeing Scotland taken out of Europe. That would be totally democratically unacceptable. We are a European country and we will stay a European country, and if that means we have to have an independence referendum to protect Scotland’s place, then so be it. Thank goodness that we have a Scottish Government and a First Minister who are prepared to lead and seek to protect Scotland’s place, and it is very welcome that this approach is being supported by Opposition political parties across the Scottish Parliament.
Meanwhile, “Project Fear” has turned to “Project Farce”. Apparently those who propose that we should leave Europe have no plan. A senior leave MP said:
“There is no plan. The leave campaign don’t have a post-Brexit plan.”
The MP went on to say:
“No. 10 should have had a plan.”
Meanwhile, UK share prices are so volatile that some stocks have temporarily been suspended and sterling has hit a 31-year low.
On one thing I hope we are all agreed: that we take serious note of the very disturbing series of racist incidents directed against our fellow citizens who happen to come from other European countries. I hope that we all, on all sides, totally repudiate these despicable acts and encourage the police and prosecuting authorities to do all they can.
Given the economic damage and uncertainty that is currently being caused, may I ask the Prime Minister the following financial questions? We welcome the actions of the Governor of the Bank of England to help provide certainty in difficult times. Can the Prime Minister confirm that the Governor has no plans at present to change his forward guidance on interest rates? The SNP will continue to support any sensible measures to deliver stability and confidence in the UK economy at this time. However, we want to be explicitly clear that this will not be used to deepen further the programme of austerity.
In conclusion, the lack of leadership from Whitehall over the past few days has been unprecedented. We recognise that any further drift or vacuum simply exacerbates uncertainty. We know that the Prime Minister is planning to leave and we wish him well, but may we have an absolute assurance that his Government will finally start to take a firm grip of the situation in which we all, sadly, find ourselves?
The Prime Minister
First, our focus should be to get the very best deal for the United Kingdom outside the European Union, and that should be the very best deal for Scotland as well.
I entirely agree with the right hon. Gentleman about the despicable acts of racism that have taken place. Let me reassure him as well that we will take every step that we can. He asked questions specifically about interest rates; that is a matter for the Governor of the Bank of England and the Monetary Policy Committee, and they set out their views in advance of the referendum. The right hon. Gentleman asked about budgets; that will be a matter for a future Government, but let me say this to him: Scotland benefits from being in two single markets—the United Kingdom and the European single market. In my view, the best outcome is to try to keep Scotland in both.
Sir William Cash (Stone) (Con)
May I pay tribute to the Prime Minister for the dignity with which he addressed the nation from 10 Downing Street on Friday? Will my right hon. Friend take a positive and simple message to the leaders of the other 27 member states of the European Council tomorrow—namely, that the voters of the United Kingdom have demonstrated the value of that great principle, the principle of democracy, for which people fought and died?
The Prime Minister
Let me thank my hon. Friend for his comment. Of course, when I go to the European Council tomorrow, I will report directly on the result and the decision of the British people. No one should be in any doubt about that, but it is important that we set off on this path of exiting from the European Union by trying to build as much good will as possible on both sides.
Tim Farron (Westmorland and Lonsdale) (LD)
May I pay tribute to the Prime Minister, following the announcement of his resignation on Friday? We have not often agreed, but his commitment to the historic bipartisanship during the coalition Government and his energetic commitment to the remain campaign contrast favourably with the tribalism of others. He has my respect and my thanks.
I respect the outcome of the referendum, but I still feel passionately that Britain’s interests are best served at the heart of Europe, in the European Union. I can accept defeat, but I will not give up. I have not changed my beliefs. With the promises of the leave campaign unravelling and no leadership being shown by the Opposition, will the Prime Minister confirm that free movement of people and access to the single market are paramount to the economic stability of Britain, and will he launch an investigation as to the whereabouts of the hon. Member for Uxbridge and South Ruislip (Boris Johnson) and of the Lord Chancellor and Secretary of State for Justice?
The Prime Minister
It is not up to me to ensure attendance in the Chamber—I have many responsibilities, but that is not one of them. Let me thank the hon. Gentleman for what he said about my leadership, and let me say how much I enjoyed appearing on a platform with him at the final rally, outside Birmingham University, which brought together him, me and Gordon Brown in a unique but obviously unpersuasive trilogy, although I have to say that he and Gordon Brown gave fantastic speeches.
The hon. Gentleman is right that the decision that we are going to have to take—and it will be for the next Government—about how we get the best possible access to the single market is going to be one of the single most important decisions that the Government will take on, because we must bear in mind the importance of safeguarding our economy, its trade links and its jobs. I think that will be a very serious consideration.
Crispin Blunt (Reigate) (Con)
Much of the distress expressed by those who voted remain on Thursday has been about the fact that they believe that their country has turned its back on their values. Does the Prime Minister agree that they can be reassured that the tolerance, openness and western liberal internationalism that we supported in the European Union will continue to be the hallmark of the United Kingdom as we seek a new role in the world?
The Prime Minister
I very much hope my hon. Friend is right. Britain is at its strongest when we stand up for our values and work with others. Let me stress that, while we are leaving the European Union, we will still be full members of NATO, the UN Security Council, the Commonwealth, the G7 and the G20. Britain does best when we make our voice heard through these organisations, and we should continue to do so.
Ms Harriet Harman (Camberwell and Peckham) (Lab)
I never thought I would see the day when I wished a Tory Prime Minister would win a vote, but last Thursday I did, and I think the country will pay a bitter price for the fact that he lost this one. Leaving aside the constitutional turmoil, the damage to the economy and the uncertainty that hangs over Britain’s place in the world, the leaders of the Brexit campaign have engendered an atmosphere where some people believe it is open season for racism and xenophobia. Will the Prime Minister say very clearly that, when it comes to the difficulties of getting a job or problems with the NHS, housing or schools, those things are the responsibility of his Government to sort out and not the fault of migrants from the EU or indeed anywhere else?
The Prime Minister
May I first praise the right hon. and learned Lady for her decision to cross party lines and to appear with others on platforms to make the argument? She made it very persuasively, and I think it is right that she did. She is absolutely right that we must be very clear about our commitment to tolerance and diversity, and about our complete intolerance of racism and the hateful hate crimes that we have seen in recent days. I know that that is the view of hon. Members in this House, whatever side of the debate they were on, but that message needs to go out loud and clear.
Dr Julian Lewis (New Forest East) (Con)
Does the Prime Minister recall that, when we held the vote in September last year on the European Union Referendum Bill, not a single Conservative, and only one Labour Member, voted against it, so is it not a bit late now for people to talk about blocking the implementation of the result just because they disagree with it? Finally—it is always good to end on a positive note—would the Prime Minister care to bring in the vote on the Trident successor submarines before he leaves office?
The Prime Minister
It is very clear: when it comes to numbers, my right hon. Friend wants four submarines and one referendum—I have got the message very clearly. He makes a good point, which is that when the House voted on the referendum, it voted by a margin of six to one to hold that referendum. We will obviously be coming forward with our plan for all the other decisions that can be made during the remainder of this parliamentary Session, and I would hope that it would include the one he mentions.
Mr Nick Clegg (Sheffield, Hallam) (LD)
I would like to add my thanks to the Prime Minister for his service to the nation as the Prime Minister of a stable, successful coalition Government for five years. Throughout that time, there were many things that he and I disagreed on, but I always appreciated his civility, his good humour—on display here again today—and his ability, which is rare in politics, to see politics from other people’s points of view. All those qualities ensured the stability that was so necessary as the country was recovering from the economic shocks of 2008, and, for that, he should be warmly thanked.
I have heard a lot about democratic principle. Would the Prime Minister agree that it surely cannot be right, as a matter of democratic principle, that only members of the Conservative party, constituting 0.003% of the total electorate, should have a say in electing a new Prime Minister of a new Government with new priorities utterly different from those he got elected on last year? Does he agree that there should be an early general election?
The Prime Minister
First of all, let me thank the right hon. Gentleman for his kind words. We did work together very successfully. I know that he paid a very large personal and political price for the support he gave to that Government. That helped to deliver economic stability and make real progress in our country, and I thank him for it.
On the leadership election that will now take place and the other points the right hon. Gentleman put, all parties have their rules for electing leaders that are arrived at democratically; we have ours, and they will be followed. In the coalition agreement, we agreed the Fixed-term Parliaments Act 2011, which many of my colleagues have misgivings about. I happen to think it is a good measure, so as a result I think the right thing is for a new Prime Minister to take office, and it will be for them to decide whether to fulfil the terms of the Act or something else.
Sir Eric Pickles (Brentwood and Ongar) (Con)
My right hon. Friend will know that a large number of people in my constituency work in the service industries, particularly financial services industries. This weekend they have seen jobs leave this country. They are worried about their future. They need not access to the single market but to be a participating part of the single market, and so does this country, as we currently have a £20 billion surplus. Will he ensure that that is given the highest priority, in the national interest, in our negotiations?
The Prime Minister
My right hon. Friend makes an important point. Let me stress that nothing changes in the UK’s trading relations with Europe until we actually leave the European Union, so there is a period when service companies—financial services—maintain the passport. One of the most important tasks for the new Government will be to negotiate the best possible arrangements with the single market, and that will be debated endlessly in this House. There is obviously a very strong case for trying to remain in that single market in some form, but that will be a decision for the new Government and for Parliament.
Hilary Benn (Leeds Central) (Lab)
As the process of leaving the European Union unfolds, we will continue to face a large number of international challenges—the crisis in Syria, climate change, and the threat of terrorism among them—and yet we risk seeing our voice in the world diminished. Does the Prime Minister agree that in the negotiations every effort should be made to ensure that we continue to have practical co-operation with our European allies so that we can maintain the kind of influence in the world that is so important to our prosperity and our security?
The Prime Minister
The right hon. Gentleman and I agree on this issue, and we spent some time on the campaign discussing it. It is important to use all these forums to maximise Britain’s influence. We will obviously have to find a way, under the new Government, to work out how to work with the European Union to get the maximum effect for the British stance on climate change, on Syria, on how we try to prevent refugees from leaving Libya, and all the rest of it. Those will all be issues for a future Government. I know from all that happened in the campaign that this is not about Britain withdrawing from the world or playing less of a role in the world, and we will have to work out the way forward.
Nicola Blackwood (Oxford West and Abingdon) (Con)
I would like to add my voice to the tributes to the Prime Minister from across this House. He is a true statesman who has made Oxfordshire proud, and we will miss him. Will he take this opportunity to reassure the science and innovation sector that the Government will fight to protect access not just to Horizon 2020 funding but to valuable research collaborations, and also to effective recruitment and retention of the brightest and best of EU researchers? They are essential to our knowledge economy and deserve to know that they will be a priority in ongoing negotiations.
The Prime Minister
I thank my hon. Friend for her kind remarks. It has been a great pleasure and privilege being her constituency neighbour and working together. How we maintain the advances in British science and competitiveness in our universities will be one of the issues that the EU unit will want to look at. Clearly we have done very well out of this bit of the European Union, and so it will be for the new Government to look at the evidence on that and how we can continue to move forward.
Kate Hoey (Vauxhall) (Lab)
I commend the Prime Minister for the way in which he handled Friday and for the very diplomatic and kind speech he has made today. I ask him to continue to show that leadership over the next month or two, to ensure that some of the hysteria about what is going to happen to our country is kept under control. Will he also condemn very clearly those people who are almost implying that decent people all over this country who voted to leave the European Union are somehow closet racists?
The Prime Minister
I have been on the opposite side to the hon. Lady in this debate, but I know that it takes a lot of courage to stand out in the way that she has done. One of my first jobs in politics was as the Conservative candidate’s researcher in the Vauxhall by-election. If I had known then that the hon. Lady would be part of my nemesis, maybe I would have worked even harder. She is right: there are many people on both sides of this debate who have very strong views about tolerance, diversity and all the rest of it, and we need to make sure that that shines through in the coming days.
Philip Davies (Shipley) (Con)
As the Prime Minister knows, I have not always agreed with him on issues, but, as he equally knows, I have always been very supportive of him personally and did not want him to make the announcement that he made last week. In saying that the country needs to come together—he is right to do so—does he accept that the first part of that is that everybody has to accept the result of the referendum, whether they like it or not, and that talk of a second referendum is for the birds? When he goes to see his European counterparts, will he pass on the message that the British people have said that we are very happy to continue with our £68 billion trade deficit with the European Union by trading with it, but in return for that we are not prepared to accept free movement of people or contributing to the EU budget?
The Prime Minister
My hon. Friend is absolutely right to say that we must accept the result—the Cabinet has and I think that everybody should—but what has to happen now is translating that result into action and choosing the correct pathway to leave the European Union and the correct relationship to have with it. That is going to take a lot of complex decision making by the new Government, and my hon. Friend obviously has a very clear view about what that should involve. It will involve a lot of separate and different decisions, but he is absolutely right to say that the decision must be accepted.
Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
Many of my constituents are European citizens and they are fearful for their future. The Prime Minister has talked about a group of officials set up to determine what Brexit will mean. Can he give any comfort to these people? If not now, will he give a timetable for when they will know how they can apply to remain in the UK?
The Prime Minister
I think that many people will be watching this with exactly the same question that the hon. Lady has asked. The technically correct answer is that while we are members of the European Union there is no change in the rights or the circumstances of people coming to live and work in Britain, or in those of Britons going to live and work in other European Union countries. I would add to that that the leave campaigners were fairly clear that they wanted to protect the rights of people who are already here who have come to live, work and study, but obviously the final clarification of that and of the rights of British people living in other parts of the European Union will have to wait for the complex negotiations.
Mr Owen Paterson (North Shropshire) (Con)
May I thank the Prime Minister for giving the British people the opportunity to vote on this issue for the first time in decades, and may I thank those who voted to leave for giving me a remarkable birthday present on Friday? I also welcome the establishment of the new unit under the Chancellor of the Duchy of Lancaster. Does the Prime Minister intend to publish a White Paper on the next steps?
The Prime Minister
No, I do not think that will be possible. The new unit has to get up and running and go through all of the complex issues that need to be sorted out, whether they be agriculture payments, borders, the situation in Northern Ireland or which British laws need to be rewritten because they mention a lot of EU law and all the rest of it. What I envisage happening is a series of papers being worked through, being discussed by the Cabinet and being prepared for the new Government as they come in.
Yvette Cooper (Normanton, Pontefract and Castleford) (Lab)
Given the enormity of this decision and the repercussions of the negotiation process, the arrangements that the Prime Minister has described sound extremely weak. He is effectively saying that Members of Parliament should just go and have an informal chat with the right hon. Member for West Dorset (Mr Letwin). The Prime Minister is leaving a dangerous political vacuum. I urge him to consider much broader arrangements to build a wider consensus, including setting up a cross-party Joint Committee of both Houses of Parliament to look at wider arrangements to involve voices from all across the country in what the negotiations about our future Britain, alongside the EU, should be. Britain feels very divided now and all of us have a responsibility to build a new consensus for the future.
The Prime Minister
I do not disagree with a lot of what the right hon. Lady is saying. Obviously, Parliament and Select Committees will want to consider how they can best produce evidence and take research and interviews to add to this process. I see the role of the Government as this. It is clear that we are moving from one situation—membership of the EU—to leaving the EU. We need to describe in a dispassionate, neutral and objective way what all the different outcomes look like and what are the advantages and disadvantages of all the different outcomes—the trade deal like Canada, the situation like Norway, and the pros and cons of being in the single market or out of the single market—so that our constituents can see the disadvantages and advantages in each case. That is what the Government should do, but Parliament—the House of Commons—can also play its part.
Sir Gerald Howarth (Aldershot) (Con)
May I also pay tribute to my right hon. Friend for giving the British people the chance to take this historic decision? I share his view that Britain will continue to be engaged with the rest of the world—I hope in a more positive fashion. May I also express the view that I am very disappointed that my right hon. Friend has decided to stand down? I wonder whether, at this difficult time, he might like to reconsider that decision. I say so because he is a star at the Dispatch Box and, furthermore, as he has demonstrated today, he will rather miss it if he is not here to do it.
The Prime Minister
I am sure there are many things that I will miss, and statements that go on for at least three hours are perhaps one of them. What on earth will I do to fill my time?
The reason for my decision to resign is that the country has made a very clear decision to go in a particular direction, and I really do believe it needs someone—fresh leadership, and a fresh pair of eyes—committed to that path and to getting it right for Britain. I think that does require change. That is why I made the decision I did, and I am certainly not changing my mind.
Alex Salmond (Gordon) (SNP)
Talking of which, at 9 o’clock this morning, the hon. Member for Uxbridge and South Ruislip (Boris Johnson) welcomed the stabilisation of the pound. At lunchtime, sterling fell to a 31-year low against the dollar. If you break it, you own it, so who owns this particular adjustment? Is it the Prime Minister, who called the referendum, or the hon. Member for Uxbridge and South Ruislip, who exploited it?
The Prime Minister
I will be very frank. The Government were elected on a manifesto promise to hold a referendum. We have held that referendum, the country has made its decision and this Government are responsible now for setting out the steps that we need to take and for doing all that is necessary to stabilise the economy. We took a choice to ask the people this very big question, because I believe in our parliamentary democracy but when it comes to the very big decisions I think it is right to consult the people. But this Government take responsibility.
Mr John Baron (Basildon and Billericay) (Con)
In respecting with dignity the wishes of the electorate, does the Prime Minister accept that he has an absolutely pivotal role to play in encouraging all sides to come together and talk the country up? Calm optimism is now required. We are a great country, and we have a very bright future ahead of us.
The Prime Minister
I certainly believe that we all have a responsibility to bring the country together and to make this new pathway work as well as it does, but we have to do it from a position of realism. We do not know exactly what some of the economic and other effects will be, so we are going to have to take great caution and care in the coming days and the coming weeks to respond to that, as well as coming together to get the best pathway for our country to leave this organisation.
Chris Leslie (Nottingham East) (Lab/Co-op)
On Friday, the Leader of the Opposition suggested we should rush to invoke article 50 renegotiations now. I disagree. I believe that it would be in good, sound order for our economy, to secure a stable transition, to make sure that article 50 is not triggered until at least the new year.
The Prime Minister
The triggering of article 50 is a matter for the British Government, and it is important we establish that. What matters is that we do as much work as possible to determine the best possible model that we want to try to negotiate for, which must be a matter for the new Prime Minister, and then he or she will make the decision to trigger article 50.
Matt Warman (Boston and Skegness) (Con)
Boston in my constituency voted more than any other place in the country to leave the European Union, and it has seen the highest level of immigration from eastern Europe to this country. I am keenly aware that those migrants are my constituents too, but does the Prime Minister agree that we owe it to the will of the people who live in my constituency to deliver on the promises to reform immigration and increase spending on the NHS if we are to retain their faith in this place?
The Prime Minister
We must continue to enact our manifesto promises, one of which was to set up an immigration impact fund. We need to set up and establish that on, I hope, an all-party basis. We should continue to deliver for the NHS, as we promised in our manifesto and as we have done. Clearly, one of the key issues in this negotiation is how to balance the difficult decisions about access to the single market and better control of immigration, and I think that goes to the heart of what the country needs to do.
Gavin Robinson (Belfast East) (DUP)
The Prime Minister and I were on different sides of this argument, but when he spoke on Friday, he did so with his dignity, his principles and his honour intact. I am very grateful to the Prime Minister for indicating that discussions will commence this week on the common travel area. May I, however, ask him to dismiss the notion that there could be a border poll in Northern Ireland, to dismiss the notion that the devolved institutions can wield a veto in this process and to resolve that only with the collective will to do what is in our national interest will we maintain this United Kingdom?
The Prime Minister
I thank the hon. Gentleman for his kind remarks. He is right to say that it is important to get it right on the common travel area issues, which are complex and difficult, if Northern Ireland is going to be the frontier between the United Kingdom outside the European Union and the European Union. On the border poll issue, the rules are set out very clearly in the Good Friday agreement, and I do not believe they have been triggered. In terms of the decision to leave the EU and how we do it, that is principally a matter for this Westminster—the United Kingdom—Parliament.
Robert Neill (Bromley and Chislehurst) (Con)
The Prime Minister has shown the decency and courage that one of my predecessors, Harold Macmillan, would have respected. I think Harold Macmillan would have wept on the day this has happened and on the day the Prime Minister departs. Will the Prime Minister concede that it is very clear legally that article 50 is the only proper means of exiting the European Union and that any attempt to circumvent it would be wrong and would involve this country in a breach of its international obligations, which no decent leader of this country should ever contemplate?
The Prime Minister
Let me thank my hon. Friend for his remarks. He is right that the only legal way that has been set out to leave the EU is by triggering article 50. That is clearly what our partners want us to do, although not all of them believe that we have to do it immediately, which is why I believe we have some time to examine the right model we want to negotiate for and then to pull that trigger. As I understand it, that is the only legal way to get the job done.
Mr Pat McFadden (Wolverhampton South East) (Lab)
During the campaign, we heard quite a lot of criticism about politicians, elites and experts, so may I ask the Prime Minister about a promise made by the leave side just this morning? The hon. Member for Uxbridge and South Ruislip (Boris Johnson) has said that he wants to maintain full access to the single market. Can the Prime Minister name a country that has full access to the single market that does not also have to accept the free movement of people?
The Prime Minister
The technical answer to the right hon. Gentleman’s question is that there are no countries today that have full access to the single market without contributing to the budget or accepting the free movement of people. Where we should try to seek some cross-party agreement is that I think it is in all our interests, whatever the eventual decision, to make sure we are as close as possible economically to our friends and partners in the European Union. That is obviously going to have to be negotiated, but my view is—the closer, the better.
Daniel Kawczynski (Shrewsbury and Atcham) (Con)
As somebody of Polish origin, I am very proud of the contribution Poles have made to this country not just during the battle of Britain, in which the Polish 303 Squadron was one of the largest, but in recent years. As chairman of the all-party group on Poland, I have invited the chairman of the Polish Social and Cultural Association to the House of Commons to show solidarity with the Poles following that appalling attack, and I very much hope that the Prime Minister might be able to join us for that meeting.
The Prime Minister
I commend my hon. Friend for his work with the Polish community here in the United Kingdom and for furthering relations between Britain and Poland. I spoke to the Polish Prime Minister this afternoon to say how concerned I was about the terrible attacks that have taken place and reassure her that we were doing everything we could to protect Polish citizens in our country. Poland is a country that is very sad to see Britain leave the European Union because we are like-minded on so many issues, including open markets and enterprise, and the Atlanticist nature of the EU. We must make sure that we work for the strongest bilateral relationship between Britain and Poland in the years ahead.
Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)
May I commend the Prime Minister for the way that he has accepted the verdict of a United Kingdom-wide referendum? The rest of the House should accept that verdict in the way he has. As for implementing it, will he tell the House whether he intends to replace our commissioner, and to set up a special unit at UKRep?
The Prime Minister
First, I congratulate the right hon. Lady on the role she played in the campaign as a very key spokesman for that side of the argument. I pay tribute to Lord Hill, who worked incredibly hard in the European Commission; I am very sad to see him go. We should try to seek a replacement, because the fact is that we are a full, contributing and paying member of this organisation until we leave, and we should therefore have a commissioner, although I am sure that will be a challenge. UKRep in Brussels is ably led by Sir Ivan Rogers, who I hope will remain in place and continue to give the excellent advice that he has given to Ministers to date.
Simon Hoare (North Dorset) (Con)
Although the hon. Member for Vauxhall (Kate Hoey) is right, I make no apology for bringing my right hon. Friend back to the topic of the racism we have seen since Thursday. A tweet has been sent to a young black woman in London that says:
“Go home! #wevotedleave. Time to make Britain great again by getting rid of u blacks, Asians and immigrants”.
When such a tweet can be sent, it would appear that a genie has been let out of the bottle—unintended, I am certain, by both sides of the referendum campaign. May I ask my right hon. Friend first that the police and prosecuting authorities have the resources to bring cases against perpetrators of this vile racism and secondly that he use his good offices with the leaderships of both of the referendum campaigns to call out this abuse for what it is and bring a stop to it now?
The Prime Minister
My hon. Friend is absolutely right. This is hideous language that we thought we had banished from our country and it is very important that everyone comes out and condemns it as strongly as possible. On his specific questions, the police have resources because we protected their budgets, and there are the necessary laws to prosecute hate crimes. As for the two campaigns, as far as I am concerned, they no longer exist; there is now one Government with one view, which is that we have to find the right path for the future. The sooner we can do that, the better.
Stella Creasy (Walthamstow) (Lab/Co-op)
I am proud to say publicly that I voted for Britain to remain in the European Union. I am sure the Prime Minister would, too. I also respect and recognise that people across this House voted differently. All of us now need to help those at the sharp end of the decision, so will he tell us specifically what measures his Government are going to put in place for all the small businesses that are now facing a loss of or a pause in contracts as a result of the decision on Thursday?
The Prime Minister
The Business Secretary consulted businesses throughout the campaign, but has obviously stepped that up and is having a very large meeting with businesses tomorrow, and I will be doing more of that later in the week. The true position is that as long as we are in this organisation—until we exit—all the rules about trade, services, financial passports and access to markets do not change. Now, informed by the work of the EU unit, we need to seek the very best possible deal to make sure that businesses can still benefit from access to European markets.
Mrs Cheryl Gillan (Chesham and Amersham) (Con)
The Prime Minister, the Chancellor and the Governor of the Bank of England have commendably acted swiftly to restore calm to the markets and confidence in our country and economy. However, the Prime Minister knows that many people are leading voters to believe that a second referendum is possible and could be run on different rules. What would he say to those people who are encouraging others to believe that that is a possibility?
The Prime Minister
People will not be surprised to hear that I am not planning a second referendum. We have to accept the result, and get on and deliver it. As we do so, we have to seek the best possible deal, and obviously this House should be involved in that process.
Caroline Flint (Don Valley) (Lab)
The scare stories about immigration that were spoken about by the people leading the leave campaign, and outriders, were frankly shameful, but we have a country that is divided between our cities and small town Britain, for which immigration was the No. 1 issue. Beyond an impact fund—which I support, although I was sorry to see it abolished some years ago—will the Prime Minister assure me that in the weeks before the House rises and over the summer, we will look more deeply into the pressures on our small town communities and different employment sectors, and into some of the abuses that are going on and the increased pressures on housing and rents? I also say gently that I am somewhat surprised by his statement that the new EU unit in Whitehall does not include the Home Office.
The Prime Minister
On that last point, the new EU unit will be working with every Department, because every Department is affected by this decision. The Home Office will play a leading role in trying to work out the options for leaving the EU but maintaining good levels of co-operation on crime, borders, information on terrorism, and all the rest of it. That useful work can be done before my successor takes office. I agree with the right hon. Lady that immigration was a key issue in the referendum, and we as a country must look at what more we can do to help people to integrate, and to examine the pressures on various public services. I made a series of suggestions about welfare changes that will not now be coming in, and I am obviously sad about that. We need to find some alternatives to those to reassure people that we can have a good, fair and managed system for immigration, from both outside and inside the EU.
Mr Jacob Rees-Mogg (North East Somerset) (Con)
All I would like to do today is thank my right hon. Friend the Prime Minister for his years of service to the party and the country. Had the result been the other way round, I hope that my side would have behaved with the dignity and nobility that he has shown.
The Prime Minister
I thank my hon. Friend for his kind remarks and for the spirit in which they were given.
Mike Gapes (Ilford South) (Lab/Co-op)
The Prime Minister said that there is now collective Government and Cabinet responsibility. In that context, will he say on behalf of the right hon. Member for Surrey Heath (Michael Gove) and the hon. Member for Uxbridge and South Ruislip (Boris Johnson) that we will have a vote in this House before article 50 is triggered?
The Prime Minister
First, on a technical issue, my hon. Friend the Member for Uxbridge and South Ruislip (Boris Johnson) is not a member of the Government—an important point. To answer the hon. Gentleman’s question directly, I cannot give that guarantee. The decision to trigger article 50 will be for the next Prime Minister and Cabinet, and the arrangements that are put in place must be for them to decide.
Mr Speaker
The Prime Minister is not responsible for the hon. Member for Uxbridge and South Ruislip (Boris Johnson), and he is probably quite pleased that he is not.
Mr Peter Bone (Wellingborough) (Con)
The Prime Minister must take great credit for delivering the referendum, for the way he campaigned—the remain vote was undoubtedly higher because of that—and for the way he reacted afterwards. We have been talking about collective responsibility, so will all Ministers now be behind the Prime Minister in leaving the EU? There is some talk today that the exit of the Prime Minister will now be earlier—sometime around the end of August. Will he comment on that?
The Prime Minister
I meant what I said about collective responsibility. It was suspended for this campaign, but it has now come back into place. Members of the Government and the Cabinet are of one view, which must be that we deliver the country’s will to exit the European Union, although the key decisions for that will be taken by the next Prime Minister. On arrangements for the leadership election in the Conservative party, all sorts of bodies—the 22, the party board, and all the rest of it—will make decisions. I am your servant, as it were. I want to ensure stability and continuity in the Government of this country and that we take the necessary steps to stabilise things. I know that the right thing to do is to hand over to a new team and new leader to take those issues forward.
Liam Byrne (Birmingham, Hodge Hill) (Lab)
I welcome the emphasis that the Prime Minister puts on coming back together as a community. There are people now living in fear in the way the hon. Member for North Dorset (Simon Hoare) described. It is down to us to put the decency back into our democracy. Does the Prime Minister understand the rage that many feel at what appear to be mistruths told about the virtues of coming out of the European Union, such as an extra £350 million a week for the national health service? May I press the Prime Minister on the answer he gave to my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper)? We are about to go into some of the most dangerous waters this country has ever entered. It would be strange if we in this House carried on with arrangements as if business was going on as usual. Transparency is the best guarantee against any more mistruths. Surely our parliamentary arrangements must be strengthened to provide oversight of the right arrangements for leaving the European Union?
The Prime Minister
First, the right hon. Gentleman is right that we need to, as he put it, get the decency into our democracy. He is right that we must stamp out hatred and intolerance, but I do not believe we need to refight the referendum campaign. I will reflect on what he says and on what the right hon. Member for Normanton, Pontefract and Castleford (Yvette Cooper) said. There is a very big task for Government and Parliament to set out and examine, in an objective and fact-based way, the alternative models for leaving the European Union: what are the advantages, what are the disadvantages? This House has a big role in that. Whether it needs a new Joint Committee or whether it suits the existing Select Committees, I am very happy to receive advice and ideas from hon. Members. But certainly this House should play a proper role in informing the public and making sure we get the decision right.
Richard Graham (Gloucester) (Con)
The Prime Minister is absolutely right that all of us who voted remain must accept the referendum result and do our best to implement it as well as possible. The manner and tone of his resignation speech and statement today is absolutely in keeping with the unifying, one nation Toryism he has done so much to advocate.
Among the divisions left in the wake of the referendum, many young people feel let down by their parents and grandparents. Does my right hon. Friend agree that in the weeks ahead the current Government should seize all opportunities to reassure young people that the opportunities and benefits that many of them see in Europe will still be available to them after the process of leaving the European Union?
The Prime Minister
My hon. Friend makes an important point. We must accept the result. During this process of debate and discussion involving Parliament and Government, there will be many arguments that people will want to look at on how we exit the EU and the relationship we will have at the end. What will it mean for young people in terms of travelling, working and studying? Those are all questions. Now that we are not talking about theoretical alternatives to membership, but are talking about the actual alternatives to membership, we need the maximum amount of detail, transparency and debate so people can make their voices heard.
Several hon. Members rose—
Mr Speaker
I am keen to accommodate colleagues, but there is a premium on brevity—to be exemplified, as always, by Mr Douglas Carswell.
Mr Douglas Carswell (Clacton) (UKIP)
I applaud the Prime Minister and I welcome his statement. Now that withdrawal from the European Union is the policy of Her Majesty’s Government, will the Prime Minister confirm that some of the architects of the vote leave campaign, not just the Europhile mandarins, will be involved in the work of the new Cabinet Office unit?
The Prime Minister
First, the Government and the Cabinet include many people who were prominent in both campaigns. As I said, the campaigns are now over: there is one Government and one Government policy. Let me take issue with the hon. Gentleman about our civil servants. They are impartial. They are hardworking. They are the best of British. They do a very fine job and I am sure they will help us to deliver this incredibly important and difficult challenge.
Mr Philip Hollobone (Kettering) (Con)
Whatever the final form our exit negotiations from the European Union take, it is clear to everyone that we will need to strengthen our trading relationship with other economies around the world. The Prime Minister is right to set up the EU exit unit in the Cabinet Office, but what steps is he taking to supercharge the Department for Business, Innovation and Skills, so that we can have a team of crack trade officials to start negotiating such trade agreements?
The Prime Minister
That is exactly the sort of issue that we will be considering. It may be the case that we have to negotiate our exit from the EU first before being able to make many of those arrangements, but we should certainly be doing the research and the work. The Foreign Office and the trade envoys can help with that as can the Department for Business, Innovation and Skills.
Mr David Lammy (Tottenham) (Lab)
May I say to the Prime Minister that I saw very closely the work that he did during the riots and I am very grateful for that? He will recognise that some of my constituents are among the poorest in Britain. In these very tough economic times, it is the poorest who will suffer. Does he recognise that young people, poor people and many middle class people who voted for remain want a plan, and that lies behind the call for a second referendum on the detail?
The Prime Minister
As I have said, we need to set out the options for the model of leaving. The next Government will make those decisions and they will have to confront the issue that the right hon. Gentleman raises of how to involve Parliament in those decisions. That will be something for them and for Parliament, but not for me.
Pauline Latham (Mid Derbyshire) (Con)
May I echo the comments of many of those who say that the Prime Minister has been a tremendous leader not just for this country, but for the party? If it was not for him, there would not be such a diverse field of Members of Parliament behind him. May I also say that, in my constituency and around Derby and Derbyshire, many businesses are concerned that trade missions abroad will be put on hold? Can we make sure that, in this period when we are still in Europe, those missions that were planned before can continue, because we must keep working for this country?
The Prime Minister
I thank my hon. Friend for her kind remarks. I can certainly give her the assurance that trade missions will continue. If anything, they need to be stepped up.
Frank Field (Birkenhead) (Lab)
May I take the Prime Minister back to the resignation of our European commissioner? Given the importance of that role, can we expect him to make a replacement within days rather than months?
The Prime Minister
I am moving on that as fast as I can. Obviously, the process of getting the commissioner appointed includes hearings of the European Parliament and all the rest of it, but as a full-paying, full member, I think that we are entitled to have a commissioner.
Mark Menzies (Fylde) (Con)
May I put on record my sincere thanks to the Prime Minister for the support that he has given to BAE Systems and its 6,500 men and women, many of whom are apprentices and graduates, who work at its facility in my constituency? Such is the level of his dedication that he has visited that plant more often than all of his predecessors combined. May I ask him for his reassurance that the Government will continue to do everything they can to secure the futures of the people who work on the Typhoon Eurofighter and on pan-European projects?
The Prime Minister
I am very grateful to my hon. Friend for his remarks. I will continue to do everything I can to support BAE Systems. I enjoyed watching Typhoons fly over Cleethorpes on Armed Forces Day on Saturday. I will continue to work as hard as I can to ensure that we secure orders abroad.
Joan Ryan (Enfield North) (Lab)
The Mayor of London has rightly expressed his concern about the consequences that Brexit will have on the London economy, jobs and growth. Clearly, that is a concern for the whole country. Given that the financial sector relies on retaining passporting rights to the European market, will the Government guarantee that that will be a top priority for negotiations with the EU? Does the Prime Minister agree with the Mayor of London that London needs a seat at the table for the forthcoming negotiations with the EU?
The Prime Minister
As I said in my statement, the Mayor of London and the London Assembly should be involved. Financial services make up 7% of our economy. Two third of the jobs are outside London, and access to the single market is vital. I hope that they make their voice heard very strongly in making sure that we seek the closest possible relationship economically with Europe.
Paul Scully (Sutton and Cheam) (Con)
Our economic priority must be to settle short-term uncertainty and to position ourselves to make the most of opportunities in the long term. Does my right hon. Friend agree that, while digesting the referendum result and commenting on a way forward, we should concentrate on our economy’s strong fundamentals and not talk our economy and our country down?
The Prime Minister
My hon. Friend is absolutely right that we must talk up our strengths—and they continue to be our strengths—but we do need to be realistic in meeting the challenges and difficulties that we face.
Rachel Reeves (Leeds West) (Lab)
The Treasury Committee’s report on our membership of the European Union looked at the short-run risks of volatility, many of which are now manifesting themselves with sharp falls in sterling, the volatility on the stock exchange and Government bond yields falling to an all-time low. What actions are the Government taking now to protect British jobs, growth and living standards?
The Prime Minister
The hon. Lady is absolutely right: the Treasury Select Committee did look at that and warned about the volatility. We have seen a lot of that volatility and the reaction of the Bank of England and the Treasury to it. As well as the volatility, we have to look out for the dangers of uncertainty. The Government stand ready to help in any way they can. Part of this will be reassuring business that all the trading relationships continue while we are in this negotiation. The hon. Lady is right to say that there will be challenges ahead.
Mr Speaker
The right hon. and learned Member for Beaconsfield (Mr Grieve) has only just started bobbing, but I think we should hear from him.
Mr Grieve
While we have to accept and must accept the referendum decision, is not the problem that, in the course of the campaign, statements were made by those advocating vote leave, which were, first, false and, secondly, in many cases unfulfillable? One thing that came out so clearly from this referendum campaign was the increasing disconnect between the public and those of us in this House who are, as the public would see it, in authority. What can we do and what should we do to restore that trust? My right hon. Friend the Prime Minister has behaved impeccably in this matter and I would like to thank him for his long service to this country, but if we do not restore that trust, the role of this House will, it seems to me, be fatally undermined.
Mr Speaker
Has the right hon. and learned Gentleman spoken for his chum as well?
The Prime Minister
I thank my right hon. and learned Friend for his kind remarks. He is right that one concern that came through in this referendum is that people are disaffected with politics and politicians, but with expert opinion as well. What we need to do now is to recognise that we are moving on from describing the situation that exists today and a number of hypothetical situations towards making real choices. Perhaps this House, the Government and all the rest of it can come into their own by setting out in a cool and neutral way what the alternatives are and the costs and benefits that apply to them. Then we might be able to restore some of the trust.
Liz Kendall (Leicester West) (Lab)
The Chancellor said this morning that action to address the referendum’s
“impact on the economy and the public finances”
will not be taken until the autumn. At a time of such risk and uncertainty and with continuing weaknesses in our economy, I find that staggering. Will the Prime Minister reconsider this decision and bring forward a proper plan, particularly to secure the private and public sector investment that our economy will need to weather the incoming storm?
The Prime Minister
I think the Chancellor was referring to the idea that fiscal measures might be necessary if the economic impacts of leaving prove to be as bad as some of the independent forecasters suggested. He was referring to the idea of having some form of Budget. The Government stand ready, with the Bank of England and others, to take any measures necessary to help to create the market stability that might be necessary.
Mr David Nuttall (Bury North) (Con)
I warmly thank my right hon. Friend for his statement today. I have long hoped for this day, ever since I stood right here on 24 October 2011 and first moved the motion that there should be a referendum on our membership of the European Union. What does my right hon. Friend think it says about the nature of the European Union that several member countries reportedly want to “punish” the UK simply because a majority of people had the temerity to vote to leave it?
The Prime Minister
Let me first congratulate my hon. Friend on his long campaign. I think that when we look at the reaction of the European Union to these events, we should be careful not to view it entirely through the filter of media outlets that want to see only one reaction. What I sense from the conversations I have had with the Germans, the French, the Poles, the Italians and others is that they are genuinely sad to see the United Kingdom go. They genuinely want to have a good and strong relationship with us when we leave. Obviously, however, they, like us, have to think of their own interests, just as we think of our own interests. The fact that the 27 member states will meet without the United Kingdom after the European Council should not be seen as surprising. In fact, many of us said that that would happen if we were to leave. We will fight like mad for our interests, but they will fight for theirs. We have to try to convince them and try to maintain in ourselves good, open and strong relations so that this becomes a dialogue leading to a mutually beneficial result rather than a war of words or something worse that then leads to a painful divorce.
Pete Wishart (Perth and North Perthshire) (SNP)
The Prime Minister’s response to my right hon. Friend the Member for Moray (Angus Robertson) was quite simply woeful. Scotland voted overwhelmingly to remain in the European Union—62% of voters, and every local authority in Scotland. We value our EU membership. We are a unitary nation. What does the Prime Minister now say to the people of Scotland, who believe that we should remain within the European Union? What do we do now?
The Prime Minister
What we do now is make sure that we get the very best outcome from this negotiation, so that it is good for the United Kingdom and good for Scotland. It is all very well the hon. Gentleman waving his finger, but that is actually what matters most to the people of Scotland.
Jeremy Lefroy (Stafford) (Con)
I pay tribute to my right hon. Friend for his leadership over many years, and thank him for it. I also pay tribute to the German Chancellor for her measured and wise words over the weekend, which I believe set a good tone for the negotiations. May I ask my right hon. Friend what measures are being taken to ensure that we strengthen bilateral relations, right now, between us and all the 27 other members of the European Union, given that we will not be dealing with them through the filter of the European Union in future?
The Prime Minister
I thank my hon. Friend for his kind remarks. Obviously, one of the great roles of the Foreign Office will be to concentrate on those bilateral relations, even as we conduct this very complicated and difficult negotiation. We do have embassies in every single European country, and we do have strong bilateral relations. With my negotiation, I was the first British Prime Minister to visit some of the further-flung parts of the European Union, and I will certainly—in whatever capacity—do everything I can to keep those bilateral relations strong, because that will help our negotiation for our future in Europe.
Kevin Brennan (Cardiff West) (Lab)
I voted remain, but belatedly picked up a leaflet this morning in my London flat—the official leaflet of the leave campaign. It said that the NHS could receive an extra £350 million a week as a result of a vote to leave. Can the Prime Minister tell us when the NHS can expect to receive that money?
The Prime Minister
Obviously, until we leave the European Union we will continue our contributions to the European Union, and at that moment my successor will have to explain where the money is going.
Alberto Costa (South Leicestershire) (Con)
The City of London boasts some of the best global lawyers in the world. May I urge the Prime Minister to speak to the Law Society of Scotland, the Law Society of Northern Ireland and the Law Society of England and Wales, to ensure that the very best British lawyers will undertake half the negotiation team’s efforts?
The Prime Minister
My hon. Friend has made an important point. I have talked about the EU unit, which will obviously contain the best and brightest from the civil service, but it is also important for us to secure the best and brightest from the private sector, whether they are lawyers, financial experts or trade experts. We want all that expertise to be involved in what will be a massive national endeavour.
Several hon. Members rose—
Mr Speaker
Order. I understand why there are courteous prefaces to many questions, and that, I think, is appreciated in the House, but it would now be really useful if we could have single, short supplementary questions, because the Prime Minister is giving admirably succinct replies.
Mr Chuka Umunna (Streatham) (Lab)
This is a short, succinct question, Mr Speaker. Does the Prime Minister think that precipitating a collapse in the value of sterling, a fall in the value of our equities and a suspension of trading in our banks amounts to Britain taking back control?
The Prime Minister
As I think I have said, there are financial consequences that we need to manage in the days and weeks ahead.
James Cartlidge (South Suffolk) (Con)
Further to the question asked by my right hon. and learned Friend the Member for Beaconsfield (Mr Grieve), does the Prime Minister accept that a very clear prospectus was sold to the electorate who voted to leave, which included an explicit promise to end unskilled migration from the European Union? That promise was explicit, and it is what those people voted for. Does the Prime Minister believe that it can be delivered?
The Prime Minister
As I have said, I think that one of the greatest challenges will be negotiating the best possible access to the single market, and balancing the issue of the best management and control of migration. That will be a decision for the future Prime Minister, and it will be one of the most important that he or she, and a Cabinet, will have to make.
Ian Murray (Edinburgh South) (Lab)
The fact that 78% of the voters in my constituency voted to remain was in no small part due to the contribution the EU makes to higher education and to the large financial services sector in Edinburgh. What is the Prime Minister doing to reassure my constituents and others all over the country, given the uncertainty that he has created by calling this referendum, in the period up to article 50 being introduced in this House, as well as after article 50 and beyond Brexit? There is uncertainty, and people are worried about their jobs and livelihoods.
The Prime Minister
First of all, we have to respect the outcome of the referendum. I think it is right not to trigger article 50 because that will start a process that will have to result in an exit within two years. That could be an unmanaged exit if the process is started too soon. The people working in financial services, including the 100,000 who work in Edinburgh and Glasgow, form an important part of our economy—[Interruption.] And in Aberdeen. And in Aberdeen Asset Management; I shall give them a plug as well. We have to do everything we can to get the best possible access to the single market.
Several hon. Members rose—
Mr Speaker
A single eloquent sentence from an illustrious QC? I call Sir Edward Garnier.
Sir Edward Garnier (Harborough) (Con)
In addition to the work that the unit of the Chancellor of the Duchy of Lancaster will be doing to look outwards to the European Union and our relations with it, will he also look at the preservation of the United Kingdom?
Paula Sherriff (Dewsbury) (Lab)
Like many others across the House, I have been saddened and deeply distressed to hear of some terrible racist and xenophobic incidents recently. In fact, during the course of this debate, I have been sent a message to say that a young lady in my constituency has been told to go “home”. This is her home, and she is very welcome here. Will the Prime Minister agree to convene an urgent meeting of a cross-party commission to look into race hate crimes and how we can eradicate this cancer from our society?
The Prime Minister
The hon. Lady’s point is absolutely right, and as for the organisation that she mentions, I shall look into it.
Mr Robin Walker (Worcester) (Con)
One of the greatest achievements of this Prime Minister has been to make the job of eliminating youth unemployment no longer an impossible dream but an achievable mission. Like him, I agree that that might become more challenging, but also like him, I agree that we must accept the outcome of this referendum. Does he agree that whoever his successor might be, he or she should ensure that the opportunities and life chances of young people are at the heart of our mission?
The Prime Minister
My hon. Friend is absolutely right. Whatever the challenges might be, and whatever route we take through the difficult pathway of access to the single market and the control of migration, one of the best ways to control migration is to increase the apprenticeships and opportunities available to our own young people in our own country to enable them to fill the jobs that our economy has created.
Dr Eilidh Whiteford (Banff and Buchan) (SNP)
Key industries in my constituency, notably agriculture and fish processing, face challenging times because they rely on European market access and also depend quite heavily on migrant workers to meet labour shortages. The Scottish Government are already meeting stakeholders in an attempt to steer through these turbulent times, but what are this Government doing to shore up confidence in those sectors? Can the Prime Minister tell us when he will be in a position to say what the status of those EU workers will be?
The Prime Minister
In terms of reaching out to businesses in different sectors, my right hon. Friend the Business Secretary will be doing that. He is holding a large meeting tomorrow with businesses, and I will be doing the same later in the week. I am certainly happy to look at some of the interests that the hon. Lady has mentioned. In terms of the answer I gave on the rights of EU workers, they will continue until we leave the organisation, and if I have heard correctly what those who want us to leave have said, the rights of those who are already here—students and workers—will be protected.
Tom Pursglove (Corby) (Con)
I too pay tribute to the Prime Minister. Does he agree that in negotiating the exit, it will be crucial for each of the nations of the United Kingdom to be formally represented?
The Prime Minister
Yes, it is important that the negotiating mandate is drawn up with the involvement of all the constituent parts of the UK.
Heidi Alexander (Lewisham East) (Lab)
Can the Prime Minister tell us what justification the Leader of the House and the Secretary of State for Northern Ireland have given him for claiming that, should we leave the European Union, there would be £350 million a week to spend on the NHS?
The Prime Minister
I do not want to re-fight the campaign. Obviously, there was a disagreement about whether we would have less money with a smaller economy or whether we would have more money by leaving the EU. We are now putting that to the test and the results will be clear for all to see.
Mrs Flick Drummond (Portsmouth South) (Con)
While I am pleased to hear that the new unit is being set up, can the Prime Minister assure us that resources will not be diverted from the life chances agenda, which he has been so instrumental in bringing in and which means so much to the people of Portsmouth, and that the agenda will continue with good pace?
The Prime Minister
I can certainly give that assurance. Obviously, the key European issues will be for the Foreign Office, the Treasury and the Cabinet Office. The agenda that my hon. Friend talks about will be important in the weeks ahead.
Kerry McCarthy (Bristol East) (Lab)
Given the disdain shown by many leading leave campaigners towards EU environmental protections, can the Prime Minister tell me what stance will now be taken as the EU looks at the fitness of the nature directives. Will we still be implementing the EU’s circular economy package?
The Prime Minister
We remain a full member of the EU and must meet our obligations as a member of the EU, including the existing directives. That is important, but such matters will then be for a future Government. In the meantime, we will carry on obeying the rules set out.
Mr Nigel Evans (Ribble Valley) (Con)
There is another group of people who are hurting since the result of Thursday’s referendum: the elderly. They have been told time and time again that they have let down Britain and the youth of this country. Will the Prime Minister confirm that the elderly are greatly valued in this country and that their voices are of equal merit to those of young people?
The Prime Minister
My hon. Friend is of course right. The key thing about a referendum is that every vote in every part of the country is worth the same.
Brendan O'Hara (Argyll and Bute) (SNP)
The overwhelming majority of my constituents and, indeed, of Scotland voted to remain in the European Union. Does the Prime Minister agree that it would be a democratic outrage if we were now to be stripped of our European citizenship?
The Prime Minister
Obviously, what I want is the best possible outcome for the United Kingdom and therefore the best possible outcome for Scotland. That is what matters most.
Jason McCartney (Colne Valley) (Con)
I join colleagues in speaking out against racism and hatred. I actually voted for 16 and 17-year-olds to have a vote in the referendum, but I also have the utmost respect for people of all ages who voted, including pensioners and the elderly. Many of them served our nation in years of peril.
The Prime Minister
I congratulate my hon. Friend on speaking out against racism. We must all continue to do that. He is right that every vote counts the same.
Peter Kyle (Hove) (Lab)
Once the Government agree the terms of the negotiation, is that not when the House should make a judgment on whether the terms of the negotiation match up to the promises made by the leave campaign? This House should make that judgment before the negotiations go forward.
The Prime Minister
This House is sovereign. Under the reforms put through by the coalition Government, this House has all sorts of opportunities to take an issue unto itself and to vote on it. That now happens much more than when I first became a Member of Parliament when it was impossible to do that. My advice would be that the House must accept the will of the country. The next Government will have to bring forward their proposals on article 50 and the rest of it, and there will have to be discussions between the Government and the House about how that goes ahead.
Kevin Foster (Torbay) (Con)
Does the Prime Minister agree that it would make as little sense for us to put trade barriers between us and 44% of our market as it would for Scotland to put barriers between itself and 90% of its export market?
The Prime Minister
My hon. Friend makes an important point. As I said, Scotland benefits from two single markets, and I am keen to keep it in one and as close as possible to the other.
Wes Streeting (Ilford North) (Lab)
If the Prime Minister cannot guarantee today that there is £350 million a week for the NHS and all the other promises made, what does that do to trust in politics and what does it say about the fitness for office of the Leader of the House, the Secretary of State for Northern Ireland, who has left the Chamber, the Secretary of State for Justice, and the former Mayor of London?
The Prime Minister
I do not propose to re-fight the campaign. The point is that the two sides had different arguments. One was that if the economy reduced in size, there would be lower tax receipts and less money available. The other side said that money will be available because we are leaving the EU. As we are now leaving the EU, we will be able to test, in time, which of those answers is the right one.
Mike Wood (Dudley South) (Con)
Succinct thanks to the Prime Minister, but what assessment has he made of the opportunities for preliminary negotiations before triggering article 50?
The Prime Minister
The assessment I have made is that it is a national sovereign decision to trigger article 50, so it is right for this Government to prepare the ground and for the next Government to choose the model they think is the right one to pursue, to hold some discussions and then to trigger the article 50 process. Just so the House fully understands, that has a two-year limit that can be extended only by a unanimous vote of all the other 27 members. At the end of that two-year period, if you do not have an arrangement, you then move to World Trade Organisation rules, so it is right that we go about this deliberately and sensibly, in order to get the best deal for our country.
Several hon. Members rose—
Mr Speaker
Another distinguished QC with a single-sentence question I feel sure—I call Joanna Cherry.
Joanna Cherry (Edinburgh South West) (SNP)
Thousands of my constituents are employed in Edinburgh’s financial sector, which is the second biggest in the UK. Can the Prime Minister give me his assurance that the UK Government will work with the Scottish Government to make sure that my constituents’ jobs do not face a similar threat to that faced by people in the City of London, where it is estimated that up to 70,000 jobs could go abroad in the next 12 months?
The Prime Minister
I can certainly give that assurance. This is an important industry for our country; it is 7% of the economy. The jobs in Scotland, in Bristol and in Bournemouth are just as valuable as the jobs in London, and I want to keep as many of them as possible.
Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)
One of my local councillors in Butetown was told this weekend to
“get out of the country”,
and a former Tory candidate, Shazia Awan, in Caerphilly, was told:
“I cannot wait to send you and the anti-white garbage that you stand for back to the third world dumps that you came from.”
Will the Prime Minister send a clear and unequivocal message from this House to that small number of people—and some leaders of other political parties—that if you indulge and stoke fear, you generate hate?
The Prime Minister
I would add to that: you not only generate hate, but you commit a crime and you can be prosecuted—and the police should not hold back.
Margaret Ferrier (Rutherglen and Hamilton West) (SNP)
With a volatile currency, there are fears that petrol prices could rise sharply as sterling falls faster than the oil price. Those fears are being heightened by the Chancellor’s threat, pre-referendum, of a punishment Budget. Will the Prime Minister assure motorists, and businesses such as Cadzow Heavy Haulage in my constituency, that the Government will not enforce a large hike on fuel duty?
The Prime Minister
Let me say now what I said at the time, which is that nobody wants to have an extra Budget or any difficult measures for taxes or spending, but, obviously, any Government have to react to the economic circumstances they face. Let us hope that the economic circumstances are not as bad as the experts predicted.
Catherine McKinnell (Newcastle upon Tyne North) (Lab)
Over the next five years, the north-east was due to receive £726 million in EU funding. Will the Prime Minister give some much needed reassurance to the regions currently relying on hundreds of millions of pounds of EU funding that they will still receive the same amount from Whitehall?
The Prime Minister
Obviously, I cannot give that assurance today, but we heard during the campaign from those who were arguing we should leave that we ought to try to do everything we can to help disadvantaged areas of the country—those in receipt of grants, farmers and the rest of it—with the best situation we can. I am sure that that is what will happen.
Liz Saville Roberts (Dwyfor Meirionnydd) (PC)
There has been no mention of Wales yet in this debate and we have been speaking for one hour and 38 minutes. Will the Prime Minister agree to speak out for our future prosperity and commit, as best he can, to Wales’s place in the European economic area?
The Prime Minister
Certainly. I mentioned Wales in my statement, and I have spoken to Carwyn Jones, the First Minister. Indeed, I appeared on a platform with him and the hon. Member for Cardiff South and Penarth (Stephen Doughty), but, sadly, that trio, brilliant though it was, was not enough to convince the people of Wales to vote to remain. It is important that we make sure that the Welsh voice is heard loud and clear. Wales has benefited from a lot of inward investment from companies that want to come to invest in Britain because we are in the single market. I would say to all those businesses that it is worth making sure that their voice is heard as we work out the best plan for the future.
Robert Flello (Stoke-on-Trent South) (Lab)
As well as jobs in the ceramics industry, many of my constituents rely on the logistics sector—indeed, all our constituencies need that sector. Given that there has already been a lot of concern about what is happening in Calais to hauliers coming across, what assurance can the Prime Minister give to the haulage industry that the border will remain in Calais, and will not find itself in Folkestone or Dover?
The Prime Minister
We support continuing the treaty that was established that has the border in Calais, and we will do everything we can to persuade the French to keep to their side of the bargain and continue as we are.
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
The Prime Minister will no doubt have seen the First Minister of Scotland move quickly to reassure EU nationals living and working in Scotland that they are welcome and valued. In the highlands we need EU citizens: they are not only essential to our economy; they are our friends and neighbours. The Prime Minister said in his statement today—
Mr Speaker
Order. I am sorry, I am not prepared to have these speeches. [Interruption.] No, I am sorry—it is a speech. What I want is a one-sentence question. [Interruption.] It is no good gesticulating at me; the hon. Gentleman has got to do as he is asked to do—now. Please: one sentence.
Drew Hendry
The Prime Minister said in his statement to EU citizens today that there would be—
Drew Hendry
The Prime Minister said in his statement that there would be no immediate changes in their circumstances. Given that Scotland voted so heavily to stay in the EU, should it not be a decision for the people of Scotland if there is to be a change in their circumstances?
The Prime Minister (Mr David Cameron)
This decision is going to have to be made by the new Government as they negotiate our position outside the EU, but I very much hope that the rights and allowances given to EU citizens here now working and studying and contributing would continue.
Diana Johnson (Kingston upon Hull North) (Lab)
I wonder whether the Prime Minister regrets not giving 16 and 17-year-olds the chance to have a say in the future of this country.
The Prime Minister
No, I have always believed that 18 is the right age to have that vote, and I have always voted accordingly.
Alison Thewliss (Glasgow Central) (SNP)
This is a Government Scotland did not elect, we had a referendum that Scotland did not want, and now Scotland is being taken out of the EU against our will. Does the Prime Minister agree that there has been a fundamental change in circumstances from September 2014?
The Prime Minister
What we need to focus on now is getting the best deal for the UK and getting the best deal for Scotland. It is worth looking at the Daily Record poll today, which indicates that it is not necessarily the case that Scotland is looking for a second referendum. [Interruption.] Just because the right hon. Member for Moray (Angus Robertson) does not like what he reads, does not mean he should not read it.
Alison McGovern (Wirral South) (Lab)
The Prime Minister keeps saying that our economic fundamentals are strong, but our membership of the EU was one of those economic fundamentals, so may I ask him to speak to the Chancellor, who has now fled this House, to set up a plan to counter the Brexit recession, including increasing capital expenditure in the north?
The Prime Minister
The Chancellor sat through a lot of this statement and the responses, so I do not think what the hon. Lady says is entirely fair. He made a very clear statement this morning, but the guarantee I can give her is that he and I will remain in our posts until a new Government arrive, and if there is action we need to take, if there are reassurances we need to give, if there are measures that are necessary, we will do all we can to make sure our economy continues to succeed.
Kirsten Oswald (East Renfrewshire) (SNP)
European citizens living in my constituency are anxious because of the despicable messages of the leave campaign— horrible incidents since the referendum and a lack of clarity now. The Prime Minister has just said there will be no immediate change to their circumstances. Does he recognise how little reassurance this brings?
The Prime Minister
Let me try to reassure Members. The only reason I am saying “No immediate changes” is that I am just trying accurately to reflect the legal situation, which is this: for people who are free at the moment to come and live and work in the UK—let me repeat that if they come here and they cannot support themselves, we can ask them to leave; that is important and has been the case for some time—as long as we are members of the EU, that continues. At the point at which we go, a Government will have to make a decision about what to negotiate with the rest of Europe about the rights of Europeans to come and live and work here—whether there will be visas or work permits, or what have you—and then there will be consequences potentially for British citizens going to live and work in Europe. The House is going to be able to debate all these things, so Members will be able to contribute to all these discussions and conversations, but I must answer accurately from this Dispatch Box, and what I can say is that as long as we stay in the EU those rights are protected, and I have gone further than that and said that everything I have heard from those who were campaigning to leave is that those rights will be continued after we have left.
Stephen Timms (East Ham) (Lab)
Does the Prime Minister accept that maintaining very strong UK participation in Europe-wide scientific research collaboration needs to be an important strand of the work he has described going forward?
The Prime Minister
I very much agree with the right hon. Gentleman. This is an area where we have got more out of Europe than we have put in, and we will clearly want to safeguard that for the future.
Patricia Gibson (North Ayrshire and Arran) (SNP)
Does the Prime Minister agree that if 55% of people in Scotland voting against independence was enough to keep Scotland in the Union, 63% voting to remain a member of the EU should be enough to keep Scotland in the European Union?
The Prime Minister
One could make the converse point, which is that if Scotland had voted to leave the United Kingdom, it would have left the European Union already.
Jim Dowd (Lewisham West and Penge) (Lab)
Some discussion following the statement revolved around the response of Members of this House to the decision of last week. Throughout my experience during 24 years in this House, I have regarded my primary responsibility as being to the people of Lewisham West and Penge, who voted 2:1 for remaining in the European Union. Thus, I will oppose any measures that come before this House that would seek to undermine that.
The Prime Minister
Obviously, Members of this House have to vote as they see fit. My sense is that it would be wrong to disregard the clearly expressed will of the British people, but clearly in future this House will be confronted with all sorts of decisions about the nature of our relationship with Europe and the rules and regulations under which we are going to leave, and the House will be able to have its say.
Tommy Sheppard (Edinburgh East) (SNP)
If mechanisms, as yet unseen, were to emerge that would allow Scotland to remain in the European Union while allowing England and Wales to leave, would the Prime Minister facilitate such an approach or would he prefer to fuel the appetite of the Scottish people for their own self-government?
The Prime Minister
Obviously, I want Scotland to stay inside the United Kingdom, and it is a United Kingdom decision to leave the European Union, so what we should focus on is the best deal for the United Kingdom and the best deal for Scotland. That is the question. It is not “Could there be a referendum?”, but “Should there be a referendum?”
Angela Smith (Penistone and Stocksbridge) (Lab)
Does the Prime Minister agree that one of the more positive things he could do in the time left to him would be to ensure that this House has the opportunity to vote before the summer recess not just on the Trident successor programme but on the building of the third runway at Heathrow?
The Prime Minister
There are a number of decisions that we are going to have to look at in the light of the new circumstances with which we are faced. I will be doing that over the coming days. I want to make sure that this Parliament is still debating, discussing and deciding important issues, and I will set out in the days to come what I think those important issues should be.
Ian Blackford (Ross, Skye and Lochaber) (SNP)
Is this not the biggest foreign policy disaster for a Conservative Prime Minister since Eden and Suez? Specifically on the Scottish question, if the Scottish Parliament, backed by the Scottish people, calls for a referendum on Scotland’s independence in Europe, will the right hon. Gentleman leave a note for the next Prime Minister to say, “You must accede to the wishes of the Scottish people and allow that referendum”?
The Prime Minister
The question is not “Could there be a second referendum?”, but “Should there be a second referendum?” I do not believe there should be. That is the point that I would make. It is not clear from the Daily Record poll today that the Scottish people want a second referendum. They, like me, want to focus on getting the best relationship for the United Kingdom with Europe. Let us try and keep all these single markets together.
Seema Malhotra (Feltham and Heston) (Lab/Co-op)
At the weekend I received an email from a teacher in my constituency saying that children from ethnic minority and EU heritage backgrounds
“were crying and telling me that they were going to have to leave. Other children told us that their parents were proud and said it was great.”
The teacher said that
“we reassured all of the children and talked about the fact that everyone here would be able to stay but our community was afraid.”
What guidance is the Prime Minister giving to teachers and head teachers? I am sure that my school was not the only one affected.
The Prime Minister
We should be very proud of our diversity in this country and of the welcome that we have given to immigrants and refugees coming to our country, and we are proud of the contribution that they make. That message needs to go out loud and clear. Just because we are leaving the European Union, it will not make us a less tolerant, less diverse nation. That needs to go out loud and clear from all of us, whatever side of the debate we were on and whatever we felt about the campaign and some of the posters in it.
Dr Lisa Cameron (East Kilbride, Strathaven and Lesmahagow) (SNP)
During the independence referendum, Scottish people were told to vote no to preserve their place within the European Union, so will the Prime Minister now give Scotland an apology for that false promise?
The Prime Minister
Had Scotland voted to leave the United Kingdom, it would have been out of the European Union. One does not need to have many conversations with the Spanish Prime Minister to know how difficult it would have been to get back in.
Karin Smyth (Bristol South) (Lab)
I am a regular traveller between Cavan in the Republic of Ireland and County Fermanagh in the north of Ireland. I never thought I would see that border go, and I weep at the thought of it returning. It beggars belief that the Secretary of State for Northern Ireland remains in post. What discussions has the Prime Minister had with the Taoiseach since Friday about Northern Ireland and the border?
The Prime Minister
Obviously, I have spoken to the Taoiseach, and I will be seeing him again tomorrow. He is taking an incredibly constructive and helpful approach. He is obviously very sad that Britain has decided to leave the European Union, but the relationship between Britain and the Republic is stronger than it has been for many, many years. What we have to do now is to sit down with officials in Northern Ireland and officials in the Republic to work out the best way of conserving all the parts of the common travel area that have been so beneficial and how we can do that in a world in which we are not in the European Union. It will be difficult, but we have to find a way through.
Alan Brown (Kilmarnock and Loudoun) (SNP)
I fail to see how a Prime Minister who is working his notice can actually guarantee the continued involvement of the devolved Administrations for what is possibly a two-year period. However, can he confirm that the Scottish Government’s initial involvement will mean that they are able to represent the will of Scotland, which is to stay in Europe?
The Prime Minister
The Cabinet agreed this morning that there should be the greatest possible involvement of Scotland, Wales and the Government in Northern Ireland in drawing up and understanding all the challenges that we need to meet in this negotiation.
Paul Flynn (Newport West) (Lab)
Has the level of lies, malice and exaggeration in both campaigns not degraded public discourse to a level where no one will believe politicians in the future? Is this not a threat to the whole status of politics and democracy?
The Prime Minister
I do not actually agree with that, and I think the turnout showed that people took this referendum campaign very seriously.
Geraint Davies (Swansea West) (Lab/Co-op)
The complex negotiations prior to triggering article 50 will shape the future of Britain, so would it not be right for the British public, in the cold light of day, to have a referendum on the facts in front of them so that they can see the future, with a backcloth of being able to remain at home in Europe if they so wish?
The Prime Minister
We had a referendum on a very important, principled question about in or out. Now what needs to happen is that the different models of out need to be properly examined. Parliament should debate them, and the Government should make a decision. That is what needs to be carried out.
Chris Bryant (Rhondda) (Lab)
Why does the Prime Minister not just commit to match the money for Wales, the north-east and all the other places that currently receive EU funding? He has made lots of commitments already today, so he could certainly do that. I will do a deal with him: if he does, I will make a contribution towards building a statue of him somewhere in Wales.
The Prime Minister
I am so glad that my resignation has set off such a chain reaction, including from the hon. Gentleman. It has been like filling a leaky bucket—the more you pour in, the faster you have to go. I have forgotten what the question was now—[Interruption.] Oh, the money. Obviously, it is at the point at which Britain leaves the European Union that a future Government will have to make the decision on how to match the money for Cornwall, the money for Wales and the money for farming. That is not a commitment I can give now. I very much hope that a future Government will be able to do that, but it will depend on the economic circumstances and the decision at the time.
Steven Paterson (Stirling) (SNP)
The constituency I represent voted by over 67% to remain, and in Scotland, of course, the figure was 62%. Can the Prime Minister understand the democratic deficit that exists in Scotland, where we are being dragged out of Europe against our will?
The Prime Minister
My constituency voted by a majority to stay in the European Union, as did most of Oxfordshire, I am pleased to report, but we are one United Kingdom, and we take this decision on a United Kingdom basis.
Liz McInnes (Heywood and Middleton) (Lab)
There are over 1.5 million 16 and 17-year-olds in the UK, and the referendum was won or lost, depending on your point of view, by 1.5 million votes. Does the Prime Minister still have no regrets about not allowing our 16 and 17-year-olds a say in their future?
The Prime Minister
I am sorry, but I do not think it would be right to change my mind about an issue simply because it would have helped my side in the debate.
The Prime Minister
Quiet you at the back.
That is why I stuck to the view I have taken all along that 18 is the right age. I often find, going round secondary schools in the country and in my constituency, that when you ask sixth formers, there is quite strong support—sometimes majority support—for keeping the age at 18.
Patrick Grady (Glasgow North) (SNP)
How does the Prime Minister’s devolution respect agenda apply to the 78% of constituents in Glasgow North who voted to remain? What is his message to one of my constituents whose parents live in Spain and are increasingly concerned about the impact that this vote will have on their healthcare in future years?
The Prime Minister
I would say, very respectfully, that we had a vote on Scotland remaining in the United Kingdom and we had the Edinburgh agreement which said that the result should be respected. That meant that Scotland was part of the United Kingdom, and the United Kingdom has now had a vote on its membership of the European Union. That is how we do things.
Ruth Smeeth (Stoke-on-Trent North) (Lab)
Seven thousand people are employed in the ceramics industry across the city of Stoke-on-Trent. Fifty per cent. of their trade is with the European Union, and their employers are incredibly concerned about the future. What reassurances can the Prime Minister give that the industry is still safe outside the European Union?
The Prime Minister
The ceramics industry is a classic example of one that needs to make its voice heard. I will make sure that happens and that we get a good negotiation, because if, at the end of two years, Britain were to come out of the European Union without an adequate deal, we could be facing quite large tariffs on, for example, ceramic products. That is a very good argument for why we need to think this through carefully, then trigger article 50 and make sure, during that process, that we protect the access of those industries to this vital market.
Neil Gray (Airdrie and Shotts) (SNP)
Earlier in his statement the Prime Minister described the financial and economic reaction to Brexit as an “adjustment”. I presume that was a euphemism. Does he believe that trillions of pounds being wiped off the share value of global companies, the pound at a 31-year low, and the threat of tens of thousands of jobs moving to the continent is just an “adjustment”?
The Prime Minister
The reason I used the word “adjustment” is this: there are clearly short-term financial and volatility effects, as we have seen, but my worry is that there will be longer-term uncertainty effects. People and businesses will be concerned about the UK’s access to crucial markets, and so there might therefore be a more fundamental adjustment. Now that the decision has been taken to leave, we need to make sure that we get the best possible access to the market so that the adjustment is as small as possible.
Gerald Jones (Merthyr Tydfil and Rhymney) (Lab)
What assurances can the Prime Minister give to businesses in my constituency on the future of regeneration projects that were funded through the EU and the jobs that are linked to them?
The Prime Minister
The budget money is set out from 2014 to 2020, and while we are members of the EU all that money will continue to be spent. The crucial decision will be for the next Government at the point of departure, which could be 2017, 2018, 2019 or later, then to give reassurances to the hon. Gentleman and his constituents about how that European money might be replaced with something else.
Several hon. Members rose—
Mr Speaker
If everybody is to get in, the questions now need to be much shorter. Otherwise, I warn people, they will not get in, and then they will be upset.
Michael Dugher (Barnsley East) (Lab)
Does the Prime Minister agree that there are profound lessons to be learned at the Government Dispatch Box, and indeed at the Opposition Dispatch Box, about how we listen to and responsibly address the perfectly legitimate concerns that good, decent working-class people have about things like unskilled immigration, and the consequent self-evident alienation they feel from their current political leadership?
The Prime Minister
Immigration was a key issue in this campaign. I was hoping that the welfare restrictions I had negotiated would help to address that, because people in this country feel a very clear sense that someone should not have something for nothing—that people should pay in before they take out. But clearly that was not enough to reassure people. Also, there has been a lot of immigration from outside the EU over many, many years. People want to see the system brought under control and management, and that is what needs to happen. We need to have a rational debate about it—I think there is a quite a lot of common ground between the two parties—and that is what we should get on with.
Stewart Malcolm McDonald (Glasgow South) (SNP)
The Prime Minister said that a leave vote was like putting a bomb under the economy. Is that part of his long-term economic plan?
The Prime Minister
Obviously, I said that I thought our economy would be better off if we stayed in. The British people have made a different decision. Now we need to make sure that we do our best to safeguard our economy in the new reality.
Andrew Gwynne (Denton and Reddish) (Lab)
In the last debate that we had on the EU, the Foreign Secretary said that the problem for the UK was that we had no experienced trade negotiators left in the civil service. What are the Government now doing urgently to train up people so that they can negotiate on trade deals?
The Prime Minister
Obviously, we are going to be increasing our capacity in that vital area.
Martin Docherty-Hughes (West Dunbartonshire) (SNP)
Earlier this year, Mr Speaker, you gave me and my community the great honour of commemorating the Clydebank blitz in your own home. Since that period in 1941, NATO and what became the European Union have delivered military and economic peace and prosperity for Europe. Do not the British Government, led by this Prime Minister, agree with my community that he has delivered us from peace into unparalleled chaos?
The Prime Minister
What this Government have delivered for Scotland is record rates of employment growth and business growth as part of a successful economy. The people of the United Kingdom have decided to take a different path with respect to Europe, but we must do all we can to continue to safeguard the economies of all the countries of the United Kingdom.
Mr Gavin Shuker (Luton South) (Lab/Co-op)
As anyone who played an active role in the remain campaign will know, immigration was the top concern for a huge number of people who voted leave because they believed that the renegotiation would lead to the ending of free movement. I regret that, but does the Prime Minister believe that if those who inherit this situation try to airbrush that out, it will end in tears?
The Prime Minister
As I have said, I think that one of the most difficult decisions for a future Government will be how to balance access to the single market—the best we can get—with decisions about immigration. I do not know what exact answer can be found. The answer I found was welfare reform, which was bold and brave because it meant reducing welfare payments to newly arrived migrants. Those changes will now not go ahead, so that extra draw will continue for the next couple of years, but we have to find an answer to that problem. In a way, that is the puzzle we have now been set by the British people, which is, “We want access to the single market and we recognise the economic argument, but you’ve got to do better when it comes to immigration.”
Peter Grant (Glenrothes) (SNP)
In response to repeated questions from Members on the SNP Benches, the Prime Minister has attempted to reduce one of the most ancient and proud nations on this planet to the status of an English shire county. May I suggest to him that if he is going to keep doing that, the Leader of the Opposition will have no need to find a shadow Secretary of State for Scotland, because there will be no Scotland Office to run in this place?
The Prime Minister
That is not what I was doing. Scotland is an incredibly proud part of our United Kingdom and I believe profoundly in the importance of the Scottish nation, Scottish nationhood and all that it brings to our United Kingdom. I was simply making the point that when there is a UK-wide decision, not everybody gets what they want. [Interruption.]
Mr Speaker
Order. The Prime Minister is very robust and perfectly capable of looking after himself, but I do think that when he addresses this House, very comprehensively, and attends to all our questions, he is entitled to a courteous hearing and not to be persistently heckled.
Andy Slaughter (Hammersmith) (Lab)
May I thank the Prime Minister and the Leader of the Opposition for their condemnation of yesterday’s racist attack on the Polish Social and Cultural Association in my constituency, which I visited this morning? The centre was built almost 50 years ago by the same generation of Poles who fought for this country in the battle of Britain, Monte Cassino and the battle of the Atlantic. Will the Prime Minister express his solidarity with the Poles and all our migrant communities, which are, in the wake of last Thursday’s vote, feeling under threat?
The Prime Minister
I am very happy to do that. As someone who used to live in the hon. Gentleman’s constituency, I know some of the Polish centres and restaurants quite well. They have made an amazing contribution to our country. He mentions the battle of Britain. We should always remember that—I do every time I go past the Polish war memorial—and we should say to those people, “You make a great contribution to our country. You are welcome and you can stay, and these attacks are hateful.”
Stuart Blair Donaldson (West Aberdeenshire and Kincardine) (SNP)
Young people across the UK voted overwhelmingly to remain in the EU, so what specifically will the Prime Minister do to reassure and support young people now that the opportunities to live, learn and work across the EU have been taken away from them?
The Prime Minister
The point is that they have not yet been taken away from them. I urge young people to make their voice heard so that as we go into this negotiation to leave the EU, we try to get the very best arrangements for people’s ability to study, travel and work, and all the benefits that young people want.
Daniel Zeichner (Cambridge) (Lab)
Our great research institutions rely heavily on funding through the European Union. The Prime Minister suggests that nothing changes immediately, but for researchers the threat feels immediate and real. What support will he give to people to help them through these uncertain times?
The Prime Minister
The point I can add to what I have said before is that, of course, all contracts will be honoured, so if a British university has won a contract under the Horizon 2020 programme or whatever, that will continue during the life of that contract. Obviously, the key decision post-leaving will be about how we put in place arrangements to safeguard our excellent research facilities and universities.
Dr Rupa Huq (Ealing Central and Acton) (Lab)
The Prime Minister has rightly condemned the worrying wave of post-Brexit racism, so will he absolutely commit to the Prevent strategy and, indeed, to reviewing funding for community cohesion generally, to stamp on these emboldened xenophobes?
The Prime Minister
I certainly think we should continue with the Prevent strategy and I am very happy to look at any ideas for things that we can do to strengthen our attack on hate crimes.
Helen Goodman (Bishop Auckland) (Lab)
The farming community will be affected by this vote almost more than any other. It, too, was promised a continuation of subsidies and support. What reassurance can the Prime Minister give it that this will indeed be the case?
The Prime Minister
I can say what I said during the campaign, which is that as far as I am concerned, I want a living, working countryside where we continue to support our farmers. That was guaranteed as part of the EU up to 2020. What is going to happen now is that those farm payments will continue up until we leave and, at the point at which we leave, a new Government will have to make a decision. Certainly, I will be pressing for continued support for agriculture because, as I say, our countryside is as it is because it is farmed, and long may that continue to be the case.
John Woodcock (Barrow and Furness) (Lab/Co-op)
Devastated citizens are unimpressed by party leaders who simply say that they did their best in this campaign. Will the Prime Minister take the opportunity at the end of this long session to say sorry for what he has done?
The Prime Minister
I made a pledge to hold a renegotiation and a referendum. I kept that pledge, and we carried it through in this House. I am sure that we have all got lessons to learn, but all I can say is that I threw absolutely everything into that campaign. I believed head, heart and soul in what I was saying. I was absolutely convinced of the merits of my case, and I did everything I could to get it across. But, in the end, if you hold a vote like that and you lose, you have got to accept the view of the British people. In my view, accepting it means that you have also got to accept that it is time for someone else to take the leadership of this great country forward, and that is why I have done what I have done. We have all got, I am sure, lessons we have learned and all the rest of it, but I am proud of the action that I took and the fact that I fought as hard as I did.
Mrs Madeleine Moon (Bridgend) (Lab)
Forty-eight per cent. of the country wake up sick at heart and angry every day. Now, large numbers of people who actually voted for Brexit are also waking up sick and angry when they find out they were lied to about money for the NHS and about immigration. How does the Prime Minister hope to build unity in this country with a Government who may well include people who misled the British public in this referendum?
The Prime Minister
We now have to come back as one Government who have accepted the will of the British people to leave the European Union, and we have to find the best way for our country as we do that. That should be the focus. There is no point refighting the campaign. We have had the campaign and we have had the decision, and now we have to make it the best we can for our country.
Martin Vickers (Cleethorpes) (Con)
May I take this opportunity to thank the Prime Minister for attending the national armed forces event in Cleethorpes on Saturday? People were very appreciative, particularly after the events of the previous 48 hours, and it was particularly appreciated by the forces, both past and present.
Although the Prime Minister has clearly stated this, some of my constituents have nagging doubts about whether the Government will actually deliver Brexit. Perhaps it would be appropriate at the end for him to reaffirm yet again that that will happen.
The Prime Minister
First of all, I thank my hon. Friend for the warm welcome that he and the people of Cleethorpes gave me on Saturday. I have heard some of this stuff about hiding away after the referendum. I was on the stage on Armed Forces Day with representatives of our brave armed forces. There was an enormous crowd in Cleethorpes, a brilliant display and a very good fly-past, march-past and all the rest of it. A lot of people said, “You’ll never hold a referendum and you’ll never have a renegotiation; it will never actually happen.” All those things did happen, and now what needs to happen is that we obey the will of the British people. We are a democracy, and that is what we will do.
Mr Speaker
I thank all colleagues, but in particular the 110 Back Benchers who questioned the Prime Minister. Perhaps I can thank the Prime Minister for the enormous dignity, grace and good humour that he has displayed this afternoon in attending, in detail and at length, to our inquiries. I say very genuinely—I hope on behalf of the whole House—something that we do not say often enough: thank you.
Points of Order
Tom Brake (Carshalton and Wallington) (LD)
On a point of order, Mr Speaker. In this House, we fight passionately for the rights of British citizens, but leaving the EU impacts directly on EU citizens in the UK and UK citizens in the EU, whose rights, we have heard from the Prime Minister, are secure but only in the short term. Do you believe that the procedures of this House are fit for purpose when it comes to ensuring that the Government represent the interest and ensure the security of EU citizens in the UK and UK citizens in the EU effectively?
Mr Speaker
Forgive me, but I must say to the right hon. Gentleman that I do not think that there is a matter contained within that purported point of order that relates to the procedures of the House for the protection of the interests of European Union citizens. Notwithstanding the expression of unrivalled solemnity on the face of a former Deputy Leader of this House as he put that point of order to me, I am still struggling to come to terms with the notion that it is a point of order rather than a point of perfectly legitimate and understandable concern, frustration and anxiety. In so far as it is the latter, the right hon. Gentleman is a sufficiently experienced and accomplished parliamentarian to find several opportunities further to expand on his concerns in the days and weeks that lie ahead.
Pete Wishart (Perth and North Perthshire) (SNP)
On a point of order, Mr Speaker. Have you been approached by the Leader of the House about the House’s business and even the Government’s legislative programme being reviewed, given the dramatic decision made by this country last week? [Interruption.] You were not listening to a word I said, Mr Speaker, so shall I ask again?
Mr Speaker
As a courtesy, I should hear the hon. Gentleman again. I am not sure the point will improve with repetition, but we can try. I beg his pardon for listening to someone else at the same time. Let him say it again. It was something to do with the Government’s legislative programme, but I am sure it is not tendentious.
Pete Wishart
Let us see whether I can improve on my point of order. Have you been approached by the Leader of the House about an urgent statement so that we can review the House’s business and even the Government’s legislative programme, given the dramatic decision that was taken last week?
Mr Speaker
The short answer to that is no. There will be the opportunity of business questions on Thursday, an occasion with which the hon. Gentleman, in view of his Front-Bench responsibilities, is very familiar, but on the question whether I have had any indication about a business statement before then, or an intended revisiting of the business of the House or of the legislative programme, the answer is no.
Ian Blackford (Ross, Skye and Lochaber) (SNP)
On a point of order, Mr Speaker. It has been brought to my attention that in a Westminster Hall debate about broadband that I attended and spoke in on 24 June 2015, I sadly failed to declare a financial interest, although my notes show that I wished to do so. I want to take this opportunity to correct the record, and to apologise profusely to the House for my error in not doing so on 24 June last year.
Mr Speaker
I am very grateful to the hon. Gentleman for giving me notice that he wished to raise this matter. I also appreciate, as doubtless will the House, that he has now, albeit somewhat belatedly, put the record straight. Let me thank him on the principle of “better late than never”.
Roger Mullin (Kirkcaldy and Cowdenbeath) (SNP)
On a point of order, Mr Speaker. This morning, the Chancellor indicated two contrary views. One was that we face great turbulence in the immediate days and weeks, and the other was that he would postpone the emergency Budget until after the Tory leadership crisis has been resolved. Much of what we face during this crisis will have an impact on the Government’s finances, including issues covered by the Finance Bill. Should we not have greater clarity before we undertake scrutiny of this Finance Bill?
Mr Speaker
If the matters of which the hon. Gentleman wishes to treat are contained in the Bill, he may very well have a perfectly good opportunity to air his concerns and undertake his scrutiny today. I am very grateful to him for giving me notice of this point of order. It is perfectly clear that the Government intend to proceed with the Committee stage of the Finance Bill today, and the proceedings will be taken in accordance, as they must be, with the programme order agreed by the House on 11 April. Although the hon. Gentleman is a new Member, he is a very accomplished and experienced person with much life experience. [Laughter.] I mean that he is a person of the world—a cerebral individual. Although debate must focus on the amendments selected, I have no doubt that he will find ways to weave into his contribution some reference to the general concerns that he has just ventilated. I am sure that he will find his own salvation. I have every confidence in him, and he should have every confidence in himself. We will leave it there for now.
Finance Bill (Ways and Means) (Taxable Benefits (Application of chapters 5, 6 and 7 of part 3 of the Income Tax (Earnings and Pensions) Act 2003))
Resolved,
That—
(1) The provision made by Resolution 4 of the House of 22 March 2016 (taxable benefits (application of Chapters 5, 6 and 7 of the Income Tax (Earnings and Pensions) Act 2003)) be varied and supplemented as follows.
(2) In section 97 of the Income Tax (Earnings and Pensions) Act 2003 (living accommodation to which Chapter 5 applies), for the subsection (1A) inserted by paragraph (2) of that Resolution substitute—
“(1A) Where this Chapter applies to any living accommodation—
(a) the living accommodation is a benefit for the purposes of this Chapter (and accordingly it is immaterial whether the terms on which it is provided to any of those persons constitute a fair bargain), and
(b) sections 102 to 108 provide for the cash equivalent of the benefit of the living accommodation to be treated as earnings.”
(3) In section 114 of that Act (cars, vans and related benefits to which Chapter 6 applies), for the subsection (1A) inserted by paragraph (3) of that Resolution substitute—
“(1A) Where this Chapter applies to a car or van, the car or van is a benefit for the purposes of this Chapter (and accordingly it is immaterial whether the terms on which it is made available to the employee or member constitute a fair bargain).”
(4) In section 120 of that Act (benefit of car treated as earnings)—
(a) in subsection (2) after “case” insert “(including a case where the cash equivalent of the benefit of the car is nil)”, and
(b) after subsection (2) insert—
“(3) Any reference in this Act to a case where the cash equivalent of the benefit of a car is treated as the employee’s earnings for a year by virtue of this section includes a case where the cash equivalent is nil.”
(5) In section 154 of that Act (benefit of van treated as earnings)—
(a) the existing text becomes subsection (1) of that section, and
(b) after that subsection insert—
“(2) In such a case (including a case where the cash equivalent of the benefit of the van is nil) the employee is referred to in this Chapter as being chargeable to tax in respect of the van for that year.
(3) Any reference in this Act to a case where the cash equivalent of the benefit of a van is treated as the employee’s earnings for a year by virtue of this section includes a case where the cash equivalent is nil.”
(6) In section 173 (loans to which Chapter 7 applies) for the subsection (1A) inserted by paragraph (5) of that Resolution substitute—
“(1A) Where this Chapter applies to a loan—
(a) the loan is a benefit for the purposes of this Chapter (and accordingly it is immaterial whether the terms of the loan constitute a fair bargain), and
(b) sections 175 to 183 provide for the cash equivalent of the benefit of the loan (where it is a taxable cheap loan) to be treated as earnings in certain circumstances.”
(7) The amendments made by this Resolution have effect for the tax year 2016-17 and subsequent tax years.
And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.—(Mr Gauke.)
Finance Bill (Ways and Means) (Travel expenses of workers providing services through intermediaries)
Resolved,
That—
(1) The provision made by Resolution 8 of the House of 22 March 2016 (travel expenses of workers providing services through intermediaries) is varied as follows.
(2) In section 339A of the Income Tax (Earnings and Pensions) Act 2003 inserted by paragraph (1) of that Resolution, in subsection (6), for paragraph (a) substitute—
“(a) in section 51(1)—
(i) disregard ‘either’ in the opening words, and
(ii) disregard paragraph (b) (and the preceding ‘or’), and”.
(3) The amendment made by paragraph (2) has effect in relation to the tax year 2016-17 and subsequent tax years.
And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.—(Mr Gauke.)
Finance Bill
(8 years, 5 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
19:22 - The Committee divided: - Ayes: 251 / Noes: 314 - Question accordingly negatived.
19:37 - The Committee divided: - Ayes: 247 / Noes: 316 - Question accordingly negatived.
20:28 - The Committee divided: - Ayes: 237 / Noes: 303 - Question accordingly negatived.
The Financial Secretary to the Treasury (Mr David Gauke)
I beg to move amendment 22, page 14, leave out lines 7 to 10 and insert—
““(1A) Where this Chapter applies to any living accommodation—
(a) the living accommodation is a benefit for the purposes of this Chapter (and accordingly it is immaterial whether the terms on which it is provided to any of those persons constitute a fair bargain), and
(b) sections 102 to 108 provide for the cash equivalent of the benefit of the living accommodation to be treated as earnings.””
The First Deputy Chairman of Ways and Means (Mrs Eleanor Laing)
With this it will be convenient to discuss the following:
Government amendments 23 to 26.
Clause stand part.
Clauses 8 and 9 stand part.
Amendment 2, in clause 10, page 15, line 29, after “omit”, insert
“, except in the case of a low emissions vehicle,”.
Amendment 3, page 15, line 38, at end add—
“(3) For the purposes of this section, a “low emissions vehicle” means any car first registered on or after 1 April 2017 which emits 0.06g or less of nitrous oxides per kilometre.”
Clauses 10 to 12 stand part.
That schedule 2 be the Second schedule to the Bill.
Clause 13 stand part.
Government amendment 27.
Clauses 14 and 15 stand part.
Amendment 180, in clause 16, page 24, line 35, at end add—
“(2) The Chancellor of the Exchequer shall undertake a review of the impact of the abandonment by HMRC of its valuation check service for Small and Medium-sized Enterprises, including its associated impact on employee share ownership schemes, and report to Parliament within six months of the passing of this Act.”
Clause 16 stand part.
Government amendment 28.
That schedule 3 be the Third schedule to the Bill.
Clauses 17 and 18 stand part.
New clause 1—Review of income tax treatment of workers providing services through intermediaries—
“The Chancellor of the Exchequer must conduct a strategic review of the impact on workers defined as providing services through intermediaries of their treatment for income tax purposes, including the differential impact on different types of worker, and must publish the report of the review within six months of the passing of this Act.”
New clause 3—Tax treatment of workers employed through intermediaries—
“The Chancellor of the Exchequer must, within six months of the passing of this Act, publish a report on the impact of the current system of employment through intermediaries on the treatment for tax purposes of the employment income of workers employed through an intermediary or umbrella company, including the role of intermediaries and umbrella companies.”
New clause 10—Employee share schemes: value for money—
“The Chancellor of the Exchequer shall, within six months of the passing of this Act, publish a report giving HM Treasury’s assessment of the value for money provided by each type of employee share scheme.”
Mr Gauke
It is a great pleasure to speak on the Government measures in this group. I will say at the beginning of my remarks that, as I mentioned to Mr Speaker earlier, and as you will have no doubt noted, Mrs Laing, I am somewhat incapacitated by a back strain. I will of course take interventions, but with your permission, I will remain standing during those interventions—bobbing up and down will be a little discomforting. May I have your permission?
The First Deputy Chairman
Please—[Interruption.] No, do not sit down. I was about to say that if the Minister had not made that point I was going to offer my permission. Having once been in the dreadful position of standing at that Dispatch Box on crutches with a broken leg, I know that although it is possible to stand still, going up and down is exceedingly difficult. I am sure the whole House has every sympathy for the Minister and will concur in giving him permission to remain on his feet.
Mr Gauke
Thank you, Mrs Laing. I am grateful for those remarks.
The measures I will outline ensure the simple, clear and fair tax treatment of employment income and benefits, strengthen incentives to choose the cleanest cars and vans, and ensure that those who have used artificial arrangements to avoid paying tax pay their fair share. Given the number of measures selected for debate, I will briefly set out how I will speak on them today. I will first discuss clauses 8 to 11, concerning company car taxation and the van benefit charge. I will then outline clause 7 and clauses 12 to 17, which address tax treatment of income and certain benefits. Finally, I will outline clause 18, which addresses disguised remuneration schemes.
I turn first to clauses 8 to 11. Clause 8 will increase the appropriate percentage for conventionally fuelled cars by three percentage points in 2019-20; it will also widen the tax advantage of ultra-low emission cars over conventionally fuelled cars in 2019-20 compared with previously announced plans. As a result of the changes, in 2019-20 a basic rate taxpayer driving a popular ultra-low emission company car will be £113 better off. Clause 9 makes a minor technical update to ensure the legislation works as is intended in 2017-18 and 2018-19. The update applies to a small number of rare company cars. It is estimated that exposure to nitrogen dioxide is linked with 23,500 deaths annually in the UK, costing approximately £13.3 billion.
As was announced in the autumn statement in 2015, clause 10 retains the three percentage point supplement for diesel company cars until 2021. That will support the UK’s transition from diesel cars to cleaner, zero and ultra-low emission cars. As a result, a basic rate taxpayer with an average ultra-low emission company car will save an additional £150 in 2016-17, compared with an employee who has an average diesel company car.
Clause 11 retains the van benefit charge for zero-emission vans at 20% of the rate paid by conventionally fuelled vans for 2016-17 and 2017-18, rather than increasing it to 40% and 60% as currently planned. That means that a basic rate taxpayer who drives a zero-emission van will save £126 in 2016-17 and £258 in 2017-18. Together, clauses 8 to 11 will incentivise business and employees to take up the cleanest cars and vans. That will help to ensure that the market for those new technologies becomes established in the UK, and to support the UK’s carbon emission and air-quality targets.
In anticipation of what we will hear from the Opposition, let me turn to amendments 2 and 3 to clause 10. The amendments would require the exemption of diesel cars from paying the supplement if they achieve the same level of nitrogen dioxide emissions as petrol cars. I appreciate that hon. Members want to incentivise people to purchase the cleanest cars, but the amendments would only introduce confusion and uncertainty. They are not linked to the wider regulatory programme to achieve the latest air quality standards, even when cars are driven on our roads. Clause 10 retains the supplement until 2021 when those new standards will be mandatory for all new cars. That approach is transparent and easy to understand, and it will give consumers confidence that all new diesel cars are comparable to petrol cars. Our approach incentivises people to purchase the cleanest cars, and in anticipation of what will be said later, I hope that Labour Members will not press the amendments to a vote.
Let me consider those clauses that clarify and simplify the tax treatment of income and certain benefits, and ensure fairness in the tax system. Clause 7 will clarify how the cash equivalents of certain taxable benefits are calculated, and ensure that fair bargain does not apply to those taxable benefits in kind where the level of computing the value of the benefit is set out in statute. The Government have made minor technical changes in amendments 22 to 26, which ensure that the legislation works as intended.
Clause 12 and schedule 2 will provide clarity that all income from sporting testimonials for an employed or previously employed sportsperson will be taxable. However, we are aware that careers in sport can be short, so we have also introduced an exemption for the first £100,000 of income received from a sporting testimonial that is not contractual or customary. The Government believe that that is a fair compromise, and the vast majority of employed sportspersons who have testimonials will not be impacted. Clause 13 introduces a statutory exemption for certain benefits costing up to £50 that employers provide to their employees. That will simplify the tax treatment of those benefits and reduce the administrative burden for employers. To ensure that the exemption is not misused, a £300 annual cap will apply in certain circumstances. That sensible and simplifying measure will reduce burdens on employers and HMRC alike.
Clause 14 will ensure that no individual or business can obtain an unfair tax advantage through claiming tax relief on home-to-work travel and subsistence expenses. It is an established principle in the UK that people are not able to claim tax relief on the cost of ordinary commuting, and the vast majority of workers are not able to do so. Individuals who are engaged through intermediaries—such as umbrella companies and their employers—currently benefit from that relief and the cost of commuting from home to work, simply because of the way they are engaged to work.
Kirsty Blackman (Aberdeen North) (SNP)
Has the Minister considered whether this measure will have a disproportionate impact on rural communities where travel is much more expensive and sometimes an overnight stay is necessary when undertaking those roles?
Mr Gauke
I will say a little more about clause 14, but I believe that this is a matter of fairness. For the vast majority of people, home-to-work costs do not have tax relief, and it is right to apply the same rules across the board. If there is a difference in treatment just because an arrangement is made through an umbrella company or other form of intermediary, clause 14 will put those workers on the same terms as everybody else. That underpins the Government’s commitment to ensure that the tax system is fair and treats all individuals who are doing the same thing in the same way.
Stewart Hosie (Dundee East) (SNP)
I understand the Minister’s argument, but this measure will offer a disincentive to many people who have chosen to go down the contracting or self-employed route. Does he share our concern that that may act as a disincentive to entrepreneurship, given that being a contractor or self-employed could be the first step to forming another business and employing other people?
Mr Gauke
I understand where the hon. Gentleman is coming from but I do not share his concerns. It does not seem justifiable that simply by arranging affairs in a particular way through an intermediary, somebody should benefit from tax relief for travel-to-work costs in a way that someone else does not. All Members recognise how important it is that we have an entrepreneurial economy, and that the importance of the self-employed in our economy is considerable. It does not seem, however, that there is a strong case for saying that a difference in tax relief should apply, which is why we have come forward with these measures. In recent years there has been a substantial increase in the number of workers engaged through an employment intermediary, and while many play a legitimate role in the labour market, increasingly some market themselves—at least in part—on the basis that they allow individuals and businesses to maximise their income through claiming tax relief on home-to-work travel expenses. The increase in the use of intermediaries means that large numbers of individuals are claiming tax relief that the majority of workers cannot claim, even when they hold very similar jobs.
We estimate that this change will save the general taxpayer more than £150 million this year, and more than £600 million by 2019-20. That will ensure fairness for all individuals and businesses, regardless of the structure through which workers are employed. In that context, amendment 27 is a technical amendment to correct a point in the original draft and ensure that the legislation fully reflects the Government’s original announcement.
New clauses 1 and 3—perhaps I may anticipate the arguments that we will hear from the Scottish National party in a moment—would require the Chancellor to publish a report on the impact on workers who provide services through intermediaries, and their treatment for tax purposes, within six months of the Bill being enacted. Those reviews would be completely unnecessary because those who provide services through intermediaries are taxed as either employed or self-employed. Some others operate as owner-directors of their own limited companies, and the tax treatment of the income and expenses of those individuals will depend on their employment status for tax purposes.
The Office of Tax Simplification carried out a review that considered the employment status and taxation of individuals working through intermediaries, and it published its report in March 2015. The Government accepted 17 of the 27 recommendations, and committed to consider a further six more. More recently, the Government have received the OTS’s review of small companies and accepted, or will consider further, nearly all its recommendations, including the recommendation that the OTS continues to develop the design of a look-through system of taxation for small businesses to simplify their tax affairs, and a new simple business model that would protect the assets of the self-employed. Following these recommendations, the Government have now formed a cross-government working group on employment status. The group will examine the advantages and challenges of an agreed set of employment status principles and a statutory employment status test. Given the volume and range of work done in this area recently, I would argue that an additional review is unnecessary. I therefore urge Members to reject new clauses 1 and 3.
Stewart Hosie
We understand the argument the Government are making against a review, but given that the Minister suggests that this will save the taxpayer—or, to put it another way, cost individuals £600 million over the lifetime of this Government—will he be prepared at least to concede that should the tax yield go up dramatically, taking yet more from the self-employed and contracting community, he might want to revisit the decision he is taking today?
Mr Gauke
No, I do not think the Government will be persuaded by that. Were that to be the case, it would suggest that the use of tax relief in these circumstances was even more widespread than we had anticipated. The problem we face is one of fundamental unfairness. I make no criticism of those making use of intermediaries in these circumstances—they are making use of the law as it stands—but it is an unfair outcome. Essentially, where two people are performing identical roles, one is able to gain the benefit of tax relief and the other is not simply because of the way in which they have structured their arrangements. I believe the approach we have taken in this clause is the right one.
Clause 15 makes changes to allow for the extension of voluntary payrolling to include non-cash vouchers and credit tokens. The change will enable businesses to benefit from reduced reporting obligations to HMRC and provide a simplified system for employers. Clauses 16 and 17 and schedule 3 make a number of changes to simplify and clarify the rules for employment-related securities and options. Employment-related securities and securities options are commonly used by companies to reward, retain or provide incentives to their employees. Remuneration in the form of shares would generally be liable to income tax and national insurance contributions. However, if they are rewarded under one of the four types of tax advantage share schemes, the shares acquired are exempt from income tax and national insurance contributions.
Share-based reward programmes are greatly valued by both companies and employees. The Government want to make sure the relevant legislation is as simple and clear as possible. To that end, clause 16 introduces schedule 3, which builds on the Government’s response to the OTS report on employee share schemes by simplifying and clarifying this area of tax legislation. In addition, clause 17 puts beyond doubt the tax treatment of non-tax advantaged securities options, given some uncertainty in the current legislation.
The Government are introducing amendment 28 to schedule 3 to ensure that the trading activities requirements to receive the tax advantages of an enterprise management incentive scheme will continue to apply where a company is controlled by an employee-ownership trust.
If I may anticipate what we are likely to hear, and before I move on to clause 18, I will briefly address amendment 180 and new clause 10, which relate to clause 16. Amendment 180 proposes a review of the impact of the withdrawal by HMRC of its valuation check service for small and medium-sized enterprises, including associated impacts on employee share ownership schemes. This is unnecessary. HMRC continues to operate a service for employee shareholder status and the tax advantage schemes most relevant to SMEs. HMRC has only withdrawn valuation checks for income tax and PAYE that are not part of these recognised employee ownership schemes. HMRC was considering valuations for less than 0.05% of the relevant SME population. As these taxpayers were using professional firms, the vast majority of cases submitted were acceptable. As such, the service added little value and was seen as providing poor value for money for the taxpayer. I therefore hope the House will reject amendment 180.
New clause 10 proposes that within six months of the passing of the Act the Chancellor should publish a report giving an assessment of the value for money provided by each type of employee share scheme. An HMRC-commissioned report conducted by Oxera considered the effect of tax advantage employee share schemes on productivity. This is publicly available. Owing to the difficulty of drawing conclusive outcomes from such studies, in 2012 the Office of Tax Simplification recommended that it would not be a good use of taxpayer money to produce further reports on the links between share ownership and productivity. As with all reliefs, however, the Government will continue to keep these schemes under review and will continue to publish regular statistics on the estimated take-up and costs of each scheme. For these reasons, I urge Members to reject new clause 10.
Let me conclude my opening remarks by addressing clause 18. The Government want to ensure that companies and individuals who have used, or continue to use, artificial arrangements to disguise their income, pay their fair share. These avoidance schemes involve income being funnelled through a third party, with the money often then given to the individual in the form of a loan that is never repaid. In 2011, the coalition Government successfully introduced new legislation to tackle the schemes in use at that time. Many of those who used the schemes before 2011 have still not settled. In addition, the tax avoidance industry has been selling new schemes that are even more artificial and contrived. At Budget 2016, the Government announced changes to address these issues. Clause 18 is the first part of that package.
Clause 18 addresses one type of these schemes by disallowing a relief in the current rules that the schemes exploit where there is a tax avoidance motive. It also withdraws a transitional relief and makes three minor technical clarifications to the current rules to ensure they work as Parliament intended. The reforms make it clear that everyone must pay their fair share. I will not take up any more time for the moment.
Rob Marris (Wolverhampton South West) (Lab)
It is a pleasure to serve under your chairmanship, Sir Roger.
I will follow what the Minister helpfully did by giving a preview of where I am going, as I think that might help the Government, but I will do it seriatim numerically. I want to probe clause 7 a little. We broadly support clauses 8 to 11, which relate to vehicles, although we have tabled two amendments to them. The Minister helpfully—in terms of procedure, if not policy—indicated that the Government were not minded to accept amendments 2 and 3. If the Government, in spite of my silver tongue, maintain that position, I will in due course seek to press amendment 2 to a Division. We broadly support clauses 12 and 13. We also broadly support clause 14, on travel expenses for workers, but I wish to probe the Government on it and ventilate some issues. We broadly support clause 15. I want to run clause 16, on employee share schemes, around the block. There are a number of share option schemes under various guises and the situation is arguably getting a little out of control. The Opposition broadly support clauses 17 and 18.
Clause 7 relates to taxable benefits. It seeks to amend 2003 legislation to clarify the concept of a fair bargain. This is, as I understand it—I am not an accountant—where an employer provides some kind of benefit in kind, which is in some circumstances provided at a cost to the employee and in some circumstances is not. Where benefits of goods or services are provided at a cost, HMRC wishes to know whether the cost of the benefits provided is below market rate. Clause 7 goes to that issue, but it appears to cover vans and cars as well as other things and of course we will be dealing with vans and cars in other clauses. As the Minister has a bad back, I will try to avoid putting him in a situation where he feels that he has to intervene. I have every sympathy with him as I have suffered from a bad back for decades. If he catches your eye, Sir Roger, when we come to closing this part of the Committee proceedings, I hope that he will be able to explain and differentiate for those of us who are not accountants how vans and cars come into the benefit-in-kind provisions under clause 7. Having had a company car for many years with two different employers, I understand how they come in under subsequent clauses—that is not to say that I know the whole regime, but I am broadly familiar with that territory—but not under clause 7. Will the Minister tell us, therefore, to what extent the Treasury has found that there has been a misuse of the original rules, thereby necessitating the clarifications under clause 7—Government amendments 22 to 26? The explanatory notes, which the Minister will know are my lodestar in these matters, refer to “uncertainty”. I hope the Minister can explain from whence that uncertainty comes, so that we can be a little clearer on that.
I will now come on to meatier matters on cars and vehicles. We are all aware that the use of the tax regime to encourage certain behaviours and discourage others is well known to have an effect when it comes to the purchase and use of vehicles, unlike in some other areas where the efficacy or otherwise of tax reliefs is not so clear. As I look around the Chamber, I can see that there are not many Members present who will remember the campaign for lead-free petrol, but I remember it and supported it. In the bad old days, lead was added to petrol as a mechanism for increasing its octane rating and therefore its power output. Initially, when the excise regime was the same for leaded and unleaded petrol, unleaded cost more. The then Conservative Government, under some pressure from the campaign for lead-free petrol and others, wisely changed the excise regime so that unleaded petrol at the pump, with a lower excise duty than leaded petrol, cost less, which meant that many motorists made the switch within a period of about two years. That was achieved by using excise levers to change behaviour in the use of vehicles.
In recent years, we have also seen the explosion in the United Kingdom of the purchase and use of diesel vehicles. That was started under a Labour Government who were trying to cut CO2 emissions, because, mile for mile, diesel engines generally emit lower CO2 per mile driven. That policy succeeded, but it was always contradictory, because there was also a 3% loading—in other words more tax payable—for those who had a diesel-powered company car in contradistinction to a petrol-powered company car.
Clause 8 increases quite markedly the percentage of the purchase price, which is then counted as taxable income for somebody who is provided with a company car. For low-emission vehicles, or those with 76 to 94 grams of CO2 per kilometre—I hope that, when we leave the European Union, we will not revert to imperial—the appropriate percentage goes from 19% to 22%. Under clause 8, the range goes up 3% each time, with a delay, as the Government have announced, for two years. Broadly, that looks to us like a tax-raising measure—there is nothing wrong with that as Her Majesty’s Revenue and Customs is about levying taxes so that the Government have sufficient income to provide the service that our constituents want.
Roger Mullin (Kirkcaldy and Cowdenbeath) (SNP)
I rise to speak to amendment 180 and new clause 1, and to indicate our support for the Opposition on amendment 2. The hon. Member for Wolverhampton South West (Rob Marris) gave his reasoning behind amendment 2 with such typical eloquence that I have nothing of any substance to add to his remarks, other than to say that we will support the amendment when it is pressed to a vote.
Earlier, I raised a point of order with the Speaker, who encouraged me to say a few words at the beginning of my speech in this debate, so I hope you will indulge me, Sir Roger. We have just had an extraordinary and historic statement from the Prime Minister, in terms of the economy and Government finances, that served merely to clarify the fact that there is no clarity. We know that we face great challenges that will be relevant to much of the Bill, yet we do not know the detail of what the Treasury and its Ministers plan to do or how their actions are likely to affect the measures in the Bill.
Sammy Wilson (East Antrim) (DUP)
Given the reduction in the number of people employed by HMRC, and the level of satisfaction with the service it provides, does the hon. Gentleman agree that it is understandable that many businesses turn to professionals whom they employ themselves rather than relying on HMRC?
Roger Mullin
I entirely agree with the hon. Gentleman, but the smallest enterprises—those employing perhaps their first or second employee and engaging in some kind of share ownership—are not in a position to pay a professional company £1,000 or £2,000 for the necessary valuation service, which was provided at no cost by HMRC. Organisations such as ProShare, which I think is based at University College London, have said that they are aware of a number of small businesses being discouraged from engaging in small-scale share ownership schemes precisely because the assistance that they were once afforded has been removed. If the demand for such services was so low, only a few people would have been needed to deliver them. The cost to the Government cannot therefore have been very great, so it seems somewhat perverse to abandon the service at a time when people are seeking to expand the number of share ownership schemes in society.
The hon. Member for Wolverhampton South West, for reasons that defy all understanding, did not think that our new clause 1 was dramatically superior to his new clause 3. No doubt he will attempt to convince the Committee of that argument later. New clause 1 proposes a review of the income tax treatment of workers providing services through intermediaries. We believe that this is particularly relevant in Scotland. The hon. Gentleman suggested earlier that the average return journey to and from work was 16.7 miles. Well, try telling that to people who live on the Isle of Skye and have to commute to places such as Fort William and Inverness. Try telling it to people who have to hop from island to island, such as the health workers who travel on ferries to service the islands and often need to stay overnight. Their situation is not remotely close to the average of 16 miles to travel to work.
A recent article in The Times Educational Supplement pointed out the proposal’s likely negative impact on the many aspects of the education sector that rely on people on particular types of contracts who do not enjoy the benefits of full-time employment. The Minister argued calmly, as he always does, that the change is a simply a matter of ensuring a level playing field. If he wanted a level playing field, he would be ensuring that workers employed through intermediaries benefit from sickness pay, holiday pay and many of the other advantages of full-time employment. They do not get those same benefits and cannot be compared with people in traditional forms of employment.
Indeed, I suspect that part of the problem is that the Government have misunderstood the needs of the modern labour market. People are no longer employed either in traditional ways or entirely self-employed in the way it is traditionally understood. Flexibilities in the labour market have developed in many ways over the past 10 or 20 years. Many such flexibilities play to and enable local economies, such as rural areas in Scotland or Northern Ireland, and specialist sectors, such as oil and gas, which need to import specialist services. These people might be based not in Scotland, but down here near London and may have to fly to provide their services. The proposal might have impacts that have not been thought through by the Government.
Rob Marris
Does the hon. Gentleman agree with UCATT, which says that such workers should be directly employed if possible? For example, UCATT has obtained agreements on behalf of workers to get employment rights in workplaces such as the Olympics or Hinkley Point. While there is a place, as the hon. Gentleman says, for employing specialist workers on oil rigs, for example, not permanently but through an intermediary, the starter for 10 or opening position should be to try to have direct employment so that people get the full panoply of rights.
Roger Mullin
I agree with the hon. Gentleman that it would be better for some in this community to achieve traditional forms of employment, but that is not the situation for the in excess of 1 million people in the UK who fall into this category.
Despite the Minister’s warm words, we intend to press new clause 1. It relates to a matter of some real import for the communities and the economy of Scotland. I have indicated that we are simply speaking to amendment 180, which we will not press, and we will support the Opposition’s amendment 2.
Kelvin Hopkins (Luton North) (Lab)
I rise to speak briefly on these amendments and new clauses. The hon. Member for Kirkcaldy and Cowdenbeath (Roger Mullin) was absolutely right to mention HMRC. Successive Governments have consistently understaffed HMRC, consistently arguing that they would make it more efficient or whatever. When I was first elected to this House 19 years ago, I remember going to my local VAT office and being told that every member of staff collects five times their salary. Being a logical sort of person, I wrote to the then Chancellor of the Exchequer and suggested that it was a good idea to employ more staff to collect more revenue for the Government. I received a letter back not from the Chancellor and not even from a junior Minister but from a civil servant, suggesting that HMRC was to save money by cutting staff. It was so irrational that it was just nonsense. That kind of nonsense has continued ever since—reducing the number of offices, making things more remote and so on. I was also not terribly impressed by the idea of having a benefits-distributing service—tax credits—going through HMRC rather than through the Department for Work and Pensions. I was not the only Opposition Member who was uneasy about that change.
I want to discuss new clause 3 and the tax treatment of workers employed through intermediaries and support my hon. Friend the Member for Wolverhampton South West (Rob Marris) on the Front Bench. It has long occurred to me that intermediaries and private agencies make lots of money out of both the public purse and the people they employ. That could be overcome if we instituted a substantial public ownership programme for agencies, particularly when the public sector is involved. If there was a local authority or NHS agency for nurses, the money would either go into the pockets of the staff employed through the agency or would be saved in public spending by the health service—everyone would benefit. However, the people who would lose would be in the private sector, which could not make profits out of employing people in this way. In that way, staffing and taxation could be properly regulated. There would be no cheating, irregularities or tax fiddles, because it would all be within the publicly accountable public sector.
Rob Marris
I have considerable sympathy with my hon. Friend on organisations such as agencies that deal with supply teachers. As he will remember from his background in education, that function was commonly done by the local education authority before, sadly, a Labour Government started changing things. LEAs were then gutted by the current Government and their predecessor. Will my hon. Friend concede that in certain areas, such as construction or oil rigs, there is a role for specialist agencies and that it would be rather Stalinist to look at nationalising them or having them run by national Government bodies, as he appeared to suggest?
Kelvin Hopkins
In the public sector, not everything that was in the past was bad. Some people say that we cannot go back to the past, but a succession of Governments have gone back to the 19th century in the way they run the economy, and neoliberalism was invented then. Since then, we have had social democracies and managed economies that worked well, but that has all been thrown away and we have gone back to the 19th century. Some things from the past that we can return to might actually improve things. I suggest that public agencies for temporary staff would be a good thing.
I might even debate with my hon. Friend that such a proposal could be employed in the private sector as well, because the staff involved would at least be properly protected, the companies would know that they are not being ripped off, and the Treasury would know that it is getting a fair deal through collecting its proper taxes. We could even have them properly organised with the trade unions, ensuring that they are properly paid and so on. We could go back to a splendid world of active social democracy. My hon. Friend’s new clause does not go quite that far, but I support it.
Rob Marris
I must say to my hon. Friend that I am quite in favour of a world of active social democracy. I am unsure whether my definition is quite the same as his if he seriously suggests that construction agencies should be run by some kind of state body—that is a step too far for me. I also caution my hon. Friend that, having got his way last Thursday, he is pushing his luck somewhat on this somewhat Stalinist approach.
Kelvin Hopkins
My hon. Friend suggests that my proposal is Stalinist, but we are talking about a world in which we had several splendid democratically elected Labour Governments after the second world war that did wonderful things. Nobody would call them Stalinist. They submitted themselves to the electorate every five years and were sometimes defeated—sometimes even in this House—so I do not think “Stalinist” is the right word.
I do think, however, that there should be a bigger role for the public sector in regulating employment, making sure that people are properly paid and securely employed, even if they are temporary staff, that taxes are fully paid and that private sector agencies do not rip off both the public purse and employees. I will leave that suggestion with my hon. Friend. I hope that he will bring forward even more radical proposals along the lines that I have suggested.
Kirsty Blackman
I shall be brief, as I know nobody wants a lengthy debate tonight. I have a couple of specific points to make about reviewing the income tax treatment of workers who provide services through intermediaries. We are asking for a review. I understand the Government’s point that they feel that their approach is sensible for the majority of workers and that it is levelling the playing field for the majority of people, but there will be unintended consequences on specific issues and in specific areas, and they are going to be a major problem.
We have mentioned that this will have a disproportionate impact on rural communities. That is partly because of geography, as those communities are further away and it is more difficult for people to make cheap travel arrangements to go there and for people to find reasonably priced overnight accommodation. That will have a disproportionate financial impact. We do not want specialist contractors to choose not to go to a rural community on the basis that it will disproportionately cost them money, as that will mean our rural communities will lose out; they will not have the ability to get whatever it is that needs to be done in that community because the contractor will choose to go somewhere cheaper. That is a major issue, particularly in the oil industry, as has been said, and in the whisky industry. The whisky industry may have specialist contractors that need to go to rural locations in order to do things, and we do not want those areas to be disproportionately affected.
Rob Marris
Some of those lower-paid workers may be working for umbrella companies, and a difference between the wording in new clause 3 and in new clause 1 is that Labour’s new clause 3 mentions umbrella companies. New clause 1 refers to “different types of worker”. Does the hon. Lady envisage that concept as including those who are engaged through intermediary or umbrella companies?
Kirsty Blackman
Absolutely we do. When we talk about “intermediaries” and “different types of worker”, we mean all those who will be impacted by this change in the taxation measures.
Mr Gauke
I am grateful for the various points made in this debate. I will not repeat everything I said in my opening remarks, but I will try to address the questions raised, and we have had plenty of those. Perhaps I should begin by saying how pleased I was to see the hon. Member for Wolverhampton South West (Rob Marris) join us, as one never knows these days who will be on the Labour Front Bench. Given the considerable work that he clearly put into his speech—not forgetting the considerable work put in by Imogen Watson—it would have been a great pity were he not to have been on the Front Bench to ask those questions, so I am delighted to see him.
Mr Gauke
The lengths people will go to in order to avoid attending a parliamentary Labour party meeting are clearly considerable.
Let me address the lengths the hon. Gentleman went to. I will also try to address the other points raised in the debate, and I will run through this in clause order—at least I will attempt to do so. Let me start by discussing clause 7, as he asked about the extent to which there have been problems and uncertainty with the tax law it addresses. There has been some uncertainty about the application of the current tax law in respect of fair bargain from a number of employers and advisers. This clause has been introduced to put the matter beyond doubt. It will give employers certainty about when fair bargain should not be applied to benefits in kind, and these issues have been recently rehearsed by the Court of Appeal. He raised a particular issue as to why there was special provision for cars and vans. Company cars and vans are a particularly valuable benefit, so the codes specify how to calculate the value to apply so that a fair and equitable tax treatment results. We have these provisions because this benefit is particularly valuable.
Rob Marris
There may be a bit of to-ing and fro-ing on this for clarification, and this may well be due to my ignorance, but is this to do with the sale, possibly at an undervalue, of a van or a car, in contradistinction to one that is supplied as a benefit in kind—the classic sales rep’s company car? Is clause 7 talking about a different scenario, such as a potential sale with it undervalued—or how does it overlap?
Mr Gauke
No, it is not talking about that. I hope that provides some clarity.
On clause 8, we were asked why the Government were imposing tax increases on drivers of low-emission cars. The company car tax system encourages people to choose the most fuel-efficient cars while ensuring that the benefit is fairly taxed. It is fair that all company car users, including those in zero-carbon and low-carbon cars, make a fair contribution to the public finances. The tax differential between ultra-low emission and conventionally fuelled cars will be widened in 2019-20 compared with previous plans announced at Budget 2013. If Members so wish, I could provide examples of that.
The question put is, “Why are the Government increasing rates on conventionally fuelled cars by three percentage points after years of two-percentage-point increases?” People also ask about the impact on the type of cars purchased. These increases ensure that the taxation of company cars continues to reflect changes in emissions technology. The rate increase, together with the extra incentive of ultra-low-emission vehicles, promotes the continued move to the cleanest cars. In 2013, there were 1,900 company ultra-low-emission vehicles, which was about 0.1% of the company car fleet, whereas in 2015 there were more than 8,000. That supports the Government’s approach. Over the course of this Parliament, increases in company car tax rates have broadly maintained revenues in real terms, in the face of continued improvements in new car fuel efficiencies, and this will support the move to cleaner, zero-emission and ultra-low-emission cars.
Rob Marris
I think I have asked this before, and the Minister may not have the figure to hand, but can he give us an estimate of how much he thinks the changes introduced by clause 8 will raise, given that for each of the four bands the percentages are going up by 3%?
Mr Gauke
If I may, I will write to the hon. Gentleman and provide him with those details.
On clause 11, the Government will review the van benefit charge support for zero-emission vans, again in the light of market developments, at Budget 2018. This clause is keeping the level at 20%—it is not increasing it as planned—and the review occurs before any further increase beyond 20%. I hope that reply is helpful to the hon. Gentleman. As for what the impact will be on the sales of zero-emission vans, extending the van benefit charge support for zero-emission vans will continue to reduce barriers to the uptake of new vehicle technologies. The Government’s enhanced capital allowances scheme for zero-emission vans and the plug-in van grant that helps with the up-front cost of buying a new ultra-low-emission van will also help to reduce barriers to the uptake of these new technologies. Together these incentives will help sales of zero-emission vans. This in turn will help the development and manufacture of clean vehicle technologies in the UK, consistent with the Government’s wider plans to promote economic growth. However, it is not possible to estimate precisely the impact on sales at this stage.
The hon. Gentleman made a point about EU air quality requirements and whether we should be doing more. The Government are committed to improving air quality, reducing health impacts and complying with legal obligations. Last December, DEFRA published the Government’s plan to achieve these aims. Under this plan, by 2020 the most polluting diesel vehicles will be discouraged from entering the centres of Birmingham, Leeds, Southampton, Nottingham and Derby. The Mayor of London has responsibility for London and his own plans for reductions. I accept that the hon. Gentleman’s amendment is well intentioned, but no vehicles would currently be caught by it and we are instead pursuing these aims more effectively elsewhere.
Rob Marris
Maybe I missed it, and I apologise in advance if I did, but when the Minister referred to stuff going through DEFRA and so on, I understood the milepost to be 2020, but 2020 seems an awfully long way away given that we should have been complying with this air quality stuff in about 2011 or 2012. It seems to be a case of kicking the can down the road while literally tens of thousands of people are dying prematurely. That is worrying.
Mr Gauke
I understand why the hon. Gentleman raises that point, but no vehicles would currently be caught by the amendment. It is a question of finding the most effective means by which to do this. As I have said, last December DEFRA published the Government’s plans to achieve these aims and I accept that further work needs to be done, but we have set out a realistic and achievable target, and by 2020 the most polluting diesel vehicles will be discouraged from entering a number of cities.
Rob Marris
The Minister says that no vehicles would be caught. My understanding of what he means by that is that no vehicles that are currently manufactured would be able to take advantage of the measure set out in amendments 2 and 3. The Minister is, I think, nodding, which is helpful. That is precisely the point of the amendments; it is to drive the market.
Mr Gauke
I appreciate that that is the intention of the amendments, and of course the hon. Gentleman would be the first to accept that it would require some time for that to take effect, but there are other measures elsewhere that the Government are taking that I believe achieve those objectives more effectively.
Kelvin Hopkins
There is a proposal to build a railway line that would take 5 million lorry journeys off our roads every year, transforming current levels of emissions, particularly in towns. This has widespread support apart from in the Department for Transport and the Government. Will the Government look seriously at the scheme and see it as a positive way forward?
Mr Gauke
This Government are committed to a very substantial investment in our railways—the biggest rail building programme since Victorian times. As a Government, we have great ambitions; we intend to spend £60 billion on transport infrastructure over the course of this Parliament.
Turning to supporting testimonials, a point was raised about the definition of “customary”. To reassure the hon. Member for Wolverhampton South West, I point out that HMRC is committed to working with external bodies in the production of guidance on this, which will cover issues such as the definition of “customary”. He also asked about the numbers of testimonials that fall within the contractual or customary categories, or fall outside that. No figures are available, as employers have not had to report this to HMRC. It is worth pointing out that contractual and customary payments are treated as earnings and it is therefore not possible to disaggregate them from the PAYE system.
A number of points were raised on clause 14. It was asked whether this change would disadvantage rural communities. Workers in rural communities who are contracted directly cannot claim travel and subsistence on their ordinary home to work commute. This change equalises the tax treatment of workers employed through employment intermediaries with that of other workers. It addresses an imbalance in our tax system, ensuring that it is fair. It is a long-standing principle of the tax system that tax relief is not allowable for the expense of ordinary commuting—travelling from home to a permanent workplace. I made that point earlier.
In terms of whether it would reduce contractors’ ability to travel, creating a skills shortage or reducing flexibility and preventing growth, where businesses wish or need to recruit workers living some distance away, the Government expect businesses to pay a wage sufficient to attract workers without any special tax subsidy being necessary. This forms part of the Government’s plan to move to a high-wage economy with businesses meeting the costs of paying their workers a wage which does not require a top-up from the state. I should also make the point in this context that this change puts supply teachers —an example that I think was used in the course of the debate—who are engaged through an intermediary on the same terms as other supply teachers who are contracted directly or through an agency. Like other workers, supply teachers not engaged in this way would not receive tax relief on their travel and subsistence expenses on regular home to work travel.
Prior to the last general election, the Labour party said that it would stop umbrella companies exploiting tax relief. It stated this both in its published plan to tackle tax avoidance and subsequently in Parliament, and that is exactly what this change does, so I hope our measures in this area will have cross-party support.
The hon. Member for Aberdeen North (Kirsty Blackman) made a point about the impact on the Scottish oil industry. Employees with a permanent workplace at an offshore oil or gas installation are already exempt from income tax where they are provided with transfer transport, related accommodation, subsistence or local transport. These changes will not affect that exemption.
Roger Mullin
The only time in my life I had to operate through an umbrella company and would have been caught by these changes was when it was at the requirement of the Government because of the way in which they had constructed a contract. Do they intend going through every Department of the UK Government to ensure they no longer contract in this way?
Mr Gauke
The Government have done considerable work in recent years to ensure that Departments do not engage in arrangements that drive down the tax bill in a way that is not the intention of Parliament.
On clauses 16 and 17 and the issue of the withdrawal of the valuation check service, the Government believe that the impact will be negligible on employee share ownership. The Government do not expect the withdrawal of these services to have an impact on the take-up of employee ownership schemes. The valuation service has not been withdrawn for the most relevant two employee ownership schemes, including enterprise management incentives, company share option plans, savers who earn share option schemes, share incentive plans and the employee shareholder status.
This rather raises the question raised by the hon. Member for Wolverhampton South West as to why we have so many different schemes. Well, each of the tax advantage share schemes has a specific policy objective, reflected in the specific qualifying conditions. Share reward schemes are greatly valued by both companies and employees, and the Government believe that these schemes can have a positive impact on productivity.
Finally, on clause 18 and the concerns that this is retrospective legislation and that it is too complex, let me be clear that the changes introduced here are relatively straightforward. More complex proposals that were announced at the Budget will instead be legislated for in Finance Bill 2017, after the Government have consulted on the technical detail over the summer. One of the main purposes of the consultation will be to ensure that genuinely innocent arrangements are not affected. On the suggestion that the legislation is retrospective, the Government expect those who have avoided tax to pay their fair share. The Government intend to legislate for the new charge in Finance Bill 2017, following the consultation that I have just mentioned. The public and tax practitioners will be able to comment on that consultation.
Normal hard-working people do pay their taxes. They are paid a salary; they are not paid in loans. It is not right that those who use these schemes receive remuneration without paying tax on it. All affected scheme users will have the opportunity to repay their loans or to pay tax on them before the changes come into effect. This is in addition to the previous settled opportunities which closed in 2015.
I hope those points of clarification are helpful to the House. I hope, therefore, that the Government clauses and amendments can be supported, and I urge hon. Members proposing their own new clauses or amendments not to press them. If not, I urge my hon. Friends to oppose them.
Amendment 22 agreed to.
Amendments made: 23, page 14, line 10, at end insert—
“( ) In section 109 (priority of Chapter 5 over Chapter 1), after subsection (3) insert—
“(4) In a case where the cash equivalent of the benefit of the living accommodation is nil—
(a) subsections (2) and (3) do not apply, and
(b) the full amount mentioned in subsection (1)(b) constitutes earnings from the employment for the year under Chapter 1.””
Amendment 24, page 14, leave out lines 13 to 16 and insert —
““(1A) Where this Chapter applies to a car or van, the car or van is a benefit for the purposes of this Chapter (and accordingly it is immaterial whether the terms on which it is made available to the employee or member constitute a fair bargain).””
Amendment 25, page 14, line 35, at end insert—
“( ) In section 120 (benefit of car treated as earnings)—
(a) in subsection (2) after “case” insert “(including a case where the cash equivalent of the benefit of the car is nil)”, and
(b) after subsection (2) insert—
“(3) Any reference in this Act to a case where the cash equivalent of the benefit of a car is treated as the employee’s earnings for a year by virtue of this section includes a case where the cash equivalent is nil.”
( ) In section 154 (benefit of van treated as earnings)—
(a) the existing text becomes subsection (1) of that section, and
(b) after that subsection insert—
“(2) In such a case (including a case where the cash equivalent of the benefit of the van is nil) the employee is referred to in this Chapter as being chargeable to tax in respect of the van for that year.
(3) Any reference in this Act to a case where the cash equivalent of the benefit of a van is treated as the employee’s earnings for a year by virtue of this section includes a case where the cash equivalent is nil.””
Amendment 26, page 14, leave out lines 37 to 39 and insert—
““(1A) Where this Chapter applies to a loan—
(a) the loan is a benefit for the purposes of this Chapter (and accordingly it is immaterial whether the terms of the loan constitute a fair bargain), and
(b) sections 175 to 183 provide for the cash equivalent of the benefit of the loan (where it is a taxable cheap loan) to be treated as earnings in certain circumstances.”” —(Mr Gauke.)
Clause 7, as amended, ordered to stand part of the Bill.
Clauses 8 and 9 ordered to stand part of the Bill.
Clause 10
Diesel cars: appropriate percentage
Amendment proposed: 2, page 15, line 29, after “omit”, insert
“, except in the case of a low emissions vehicle,”.—(Rob Marris.)
Question put, That the amendment be made.
The Temporary Chair (Sir Roger Gale)
With this it will be convenient to discuss clauses 133 and 134 stand part.
Amendment 183.
Clauses 135 and 136 stand part.
The Exchequer Secretary to the Treasury (Damian Hinds)
Clauses 132 to 136 set out changes to the climate change levy, or CCL, which is a tax levied on the supply of energy to businesses and the public sector. It was introduced in 2001 to incentivise industrial and commercial energy efficiency. The Finance Act 2015 removed the climate change levy exemption for renewable electricity generated on or after 1 August 2015. A consultation was then held to seek views from industry on the appropriate length of time for the transitional period.
Clause 132 sets the length of the transitional period during which electricity suppliers can continue to exempt from the climate change levy renewably sourced energy generated before 1 August 2015. The clause provides for an end date for the transitional period of 31 March 2018. Setting a transitional period will minimise the administrative impact on electricity suppliers by giving them time to retain the benefit of renewably sourced electricity acquired before the date of the change.
Following a review of the business energy tax landscape and consultation with industry, it was announced at Budget 2016 that the Government would abolish the complex and unduly burdensome carbon reduction commitment energy efficiency scheme and move to a single tax—the existing climate chance levy—from 2019. Moving to one tax will provide a clearer price signal for business energy use, incentivising energy efficiency while reducing administrative burdens.
Clauses 133 and 134 set the main rates of the CCL from 1 April 2017 and 1 April 2018 to increase by the retail prices index. Legislating for those increases now provides certainty for businesses before the wider business energy market reforms take place.
Clause 135 will increase the climate change levy rates above RPI from 1 April 2019, to recover the revenue that will be lost from abolishing the CRC. Increasing climate change levy rates will strengthen the incentive for businesses with the greatest potential to save energy. At the same time, rebalancing the rates for different taxable commodities from 1 April 2019 will update an outdated ratio and more closely reflect the carbon content of the energy used. That will help to deliver on our commitment to achieve greater carbon savings.
Clause 136 will increase the levy discount for energy intensive sectors with climate change agreements. That will ensure that businesses in those sectors will pay no more in the climate change levy than the expected RPI increase in April 2019, thereby enabling them to maintain their international competitiveness. Those reforms will take place in 2019, providing a three-year lead-in time for businesses to adjust to the new business energy tax landscape.
Several hon. Members have in the past voiced concern over the impact of the clause to remove the climate change levy exemption from renewably sourced electricity, so allow me, if you will, Sir Roger, to repeat the reasoning for the removal of that exemption. There is no doubt that the exemption was increasingly providing poor value for money for British taxpayers. Without action, the exemption would have cost almost £4 billion over the course of this Parliament, providing only indirect support to renewable generators.
Other Government support for UK low-carbon generators demonstrates this Government’s commitment to renewable energy. Since 2010, nearly £52 billion has been invested in renewables, and that has led to a trebling of the UK’s renewable electricity capacity. There was another record year in 2015, with £13 billion invested in renewable electricity. Removing the exemption will provide better value for money for UK taxpayers, contribute to fiscal consolidation and maintain the climate change levy price signal necessary to incentivise business energy efficiency.
The Government’s consultation with industry showed that the current business energy tax landscape was too burdensome and complex. Clauses 132 to 136 demonstrate the Government’s commitment to simplify and improve the effectiveness of business energy taxes in order to meet our environmental targets.
Amendment 183 stands in the name of the hon. Member for Salford and Eccles (Rebecca Long Bailey) on behalf of the Opposition. If I may pause for a moment, I want to take this opportunity to congratulate her on her elevation today. It is an extremely well-deserved promotion and we wish her all the best in her new role. On this occasion, however, I am afraid that her amendment has slightly less merit. It would require the Chancellor to publish a report detailing the impact of the climate change levy in reducing carbon emissions within 12 months from the passing of the Finance Bill, but such a review is unnecessary.
Following a hearing on the 2015 summer Budget, the Chancellor wrote to the Treasury Committee on the impact of the removal of the CCL exemption. He made it clear that the exemption would not directly affect our commitment to reduce carbon emissions. In addition, the Department of Energy and Climate Change already intends to publish a consultation on a simplified energy and carbon reporting framework later this year. That will be accompanied by an impact assessment, which will examine the removal of the carbon reduction commitment and propose adjustments to reporting requirements.
The impact of ending the exemption from the climate change levy for renewable electricity has been discussed at length over the course of debates. It has been confirmed to Parliament in writing by the Chancellor that removal of the exemption will not impact on the UK’s ability to meet its carbon budget targets. I therefore urge the hon. Lady to withdraw the amendment, but should she be minded not to do so, I urge the Committee to reject it.
Rebecca Long Bailey (Salford and Eccles) (Lab)
I thank the Minister for his kind comments and for being a fantastic duelling partner in these debates. He has been nothing less than respectful and I have enjoyed debating with him.
I rise to speak to clauses 132 to 136, which make various changes to the climate change levy, and to amendment 183, which stands in my name and those of my hon. Friends the Members for Hayes and Harlington (John McDonnell), for Feltham and Heston (Seema Malhotra), for Wolverhampton South West (Rob Marris) and for Leeds East (Richard Burgon).
Clause 132 relates to the removal of the exemption for electricity from renewable sources. Since the climate change levy’s inception in 2001, electricity from renewable sources has been exempt when supplied under a renewable source contract agreed between an energy supplier and its customer. In Budget 2015, the Chancellor announced that that exemption for renewable electricity would be removed from 1 August 2015 and that there would be a
“transitional period for suppliers...to claim the CCL exemption on any renewable electricity that was generated before that date.”
Following an informal consultation, which received 18 responses, the Government announced that the transitional period would end on 31 March 2018, legislated for in this Finance Bill.
The House will be aware that we, along with several Government Members, opposed the removal of that exemption in the Finance Act 2015, and we maintain that position. We will therefore abstain on the clause, but I would like the Minister to address one particular point. In answer to written questions, the Government have refused to publish a summary of responses to the informal consultation, as they contained “commercially sensitive information”, and they refuse to publish an average of suggested timescales. Will the Minister give us an assurance that the length of the transitional period was, in fact, in line with the recommendations of the respondents?
Clauses 133 and 134 will increase the main rates of the climate change levy in line with inflation in April 2017 and again in April 2018. It has been standard practice to increase the rates in line with inflation in each year’s Finance Bill since 2007 and, as the explanatory notes set out, wider changes to the CCL from 2019 are being legislated for in this Bill, so it makes sense to make provision for the next two years at the same time.
Those wider changes are the subject of clause 135, which significantly increases the main rates of the climate change levy to recover Exchequer revenue lost from the abolition of the carbon reduction commitment. In doing so, the ratio of electricity to gas is rebalanced somewhat to 2.5:1, and it is the Government’s intention to rebalance the ratio further to 1:1 by 2025, to reflect the fall in gas prices and the expected increase in consumption as a result.
The following clause increases the CCL discount available to energy intensive businesses subject to climate change agreements, to compensate equivalently for the increase to the main rates. The CCL discount for electricity will increase from 90% to 93%, and the discount for gas will increase from 65% to 78% from 1 April 2019. That provision mitigates a knock-on effect from clause 135.
Our amendment to clause 135 would require the Government to conduct a review of the impact of the climate change levy on carbon emissions. The review will have particular reference to the removal of the exemption for electricity generated from renewable sources, the abolition of the carbon reduction commitment and the reporting requirements for companies and public sector bodies.
Kirsty Blackman
I rise to support amendment 183 on the changes to the climate change levy. The UK Government’s idea to have a climate change levy was admirable. It was introduced in 2001, and it has been a positive step. It is completely reasonable that companies should be made to think about their energy usage, and the best way to do that is to tax them on it. The hon. Member for Salford and Eccles (Rebecca Long Bailey) made a wide-ranging speech on a series of matters, some of which I was going to speak about, so I will curtail my speech somewhat.
Although reducing companies’ energy consumption and usage is a great idea, it fails to take into account the fact that some methods of generating electricity are better than others, particularly in terms of climate change. We cannot tax energy usage across the board given that energy generated from, say, onshore wind is much cleaner and better than energy generated from, say, a coal-fired power station. Those two things are very different, and it is completely reasonable to have variable tax rates for those two things.
The hon. Lady spoke about some of the impacts that the Government’s energy policy is having on low-carbon energy. This Government do not have a good record on supporting low-carbon energy. Their support for nuclear has been widely reported, but the situation is very difficult for companies that are innovating in providing other forms of low-carbon energy in this ever-changing climate and in the UK Government’s current policy framework.
It was announced in June that the Scottish Government had managed to meet their target for reducing greenhouse gas emissions by 2014. The target was a reduction of 42%, and it happened six years early. That was an excellent achievement for the Scottish Government and for Scotland as a whole, with everyone working together to reach it. However, it will be very difficult for us to keep up that level of achievement with the UK Government’s current energy policy. For example, there is no clarity about when there will be a new pot 1 for contracts for difference. That pot is for onshore wind, which is very important. It is very clear that onshore wind is an established technology for generating electricity cleanly, and the UK Government need to provide greater clarity about when the next CFD round for it will be.
With Brexit, Scotland will have a major problem in that the funding for low-carbon energy and low-carbon energy projects, particularly the groundbreaking ones, has come from the EU. I know that this is slightly outside the remit of this debate, but I would appreciate it if the UK Government looked at whether this funding will continue to be provided because we should continue to innovate in low-carbon energy in Scotland, which has massive natural resources.
Philip Boswell (Coatbridge, Chryston and Bellshill) (SNP)
I will focus on clauses 132 to 136, in part 9, and amendment 183, which pertain to the climate change levy. Both the hon. Member for Salford and Eccles (Rebecca Long Bailey) and my hon. Friend the Member for Aberdeen North (Kirsty Blackman) have spoken comprehensively on this subject, so I will keep my speech relatively short.
I have particular concerns about the removal of the exemption for electricity generated from renewable sources. I believe that this counterproductive decision will grossly undermine the development of the UK’s energy sector. The long-term future of our energy market is in renewables. The UK, and Scotland in particular, has extraordinary potential in the renewables sector
Scotland has 25% of the wind and tidal potential in all of Europe, and 10% of the wave potential in Europe. For a small country—in both landmass and population, although it none the less represents a third of the UK landmass—these figures represent enormous potential not just for leading the world in renewable energy production, but in creating tens of thousands of jobs and ushering in substantial economic growth.
However, this Conservative UK Government seem determined to tear down any progressive policies that are designed to encourage and incentivise the production of green energy. Just this year, the Government have begun the process of privatising the Green Investment Bank, as the hon. Lady said. In addition, this Government have cut subsidies for small-scale solar panels by 65%, which is a massively damaging blow to the industry that can save households a few pounds.
As the hon. Lady and my hon. Friend the Member for Aberdeen North did, I will mention the scrapping of support for onshore wind, the removal of the biomass renewables obligation subsidy level guarantee, the killing of the flagship green homes scheme and the cancellation of the carbon capture initiative, which I was heavily involved in. What about the future? What hope is there for the Swansea Bay tidal programme, given the track record of this Government?
The climate change levy was a positive step in the right direction. It was a policy designed to provide a disincentive for polluting technologies. It is perverse that the climate change levy has been applied to green, clean energies. That is not what it was intended for. This change will have a disproportionate impact on Scotland, which despite having under 10% of the UK population, as my hon. Friend said, produces a third of the UK’s renewable energy.
Despite the austerity implemented by this UK Government, Scotland has continued to drive forward in reducing its carbon footprint and increasing the use of green electricity. As my hon. Friend also said, earlier this month it was announced that we in Scotland had reached our target of making a 42% reduction in carbon emissions by 2020, which is six years earlier than expected. The SNP Scottish Government have now set a more ambitious target of a 50% reduction in carbon emissions by 2020. However, I fear that despite our progress, unfortunate choices by the Conservative UK Government —both their ill-advised and counterproductive austerity obsession and the mishandling of the EU referendum, leading to a vote for Brexit—will mean regression, rather than progress on climate change and the promotion of renewable energy.
For those reasons, I wholeheartedly support amendment 183, in the name of the hon. Member for Salford and Eccles.
Damian Hinds
The climate change levy makes a significant contribution to the Exchequer’s revenues. It had been on a declining path, but with the changes that have come in, its path has been stabilised. It had been providing increasingly poor value for money, partly because a third of its value was going to generators overseas: that generation does not contribute to UK targets, and quite often benefits from subsidies and other benefits at home.
There was also only indirect support for renewables. This is a really important point that goes to the heart of what the hon. Members for Aberdeen North (Kirsty Blackman) and for Coatbridge, Chryston and Bellshill (Philip Boswell) were saying. The renewables obligation and contracts for difference are much more effective at providing direct support, at a higher level than the £5.54 per hour, to bring on the generation that we need.
The success of the deployment of renewables in this country paradoxically has an adverse impact on the effectiveness of the CCL exemption, such that by the early 2020s it would not be effective in stimulating new capacity to come on stream. Its value to generators would be declining, because the supply of renewables and therefore of the levy exemption certificates would exceed in volume the total potential demand from eligible customers in business and the public sector.
Kirsty Blackman
If the Minister is saying that the exemption will not be effective after 2020, does he concede that it would therefore be effective to keep it in place now?
Damian Hinds
Sir Roger, he does not. As I was trying to say, this is not a cliff-edge thing. Its effectiveness has been declining over time and a lot of the value leaks overseas. Most important of all, there are other ways of directly stimulating new renewables provision. Without getting too far into the weeds and the details of what goes where, those other ways make sure that the benefit goes directly to the generators rather than being split between different parts of the value chain. CfDs stabilise the price relative to some of the fluctuations of the wholesale market, which in turn increases investor confidence and can help drive investment.
The hon. Member for Salford and Eccles (Rebecca Long Bailey) asked about the transitional period, and her various parliamentary questions about the responses received to the informal consultation on that. Suppliers were invited to respond; of those that did, only one requested a transitional period in excess of three years. All others were content with an end date of 31 March 2018. Most said that they would have used their levy exemption certificates within a year. We have not published the results of that consultation because, as she rightly said, it included commercially sensitive information. The size of the sample and the number of responses mean that it does not make sense to speak in terms of the average period that was called for.
I turn to the abolition of the carbon reduction commitment and changes to the climate change levy main rates. Those are major simplifying moves. We had extensive consultations—both written consultations and meetings, a number of which I sat in on—and businesses said loud and clear that they wanted to simplify how it all worked. They valued the discussions that had taken place and the elevation of the role and salience of energy efficiency within their companies. But the CCL as a single tax will be a straightforward price signal. We will also be removing some of the additional administrative burden.
The Government will also consult on a simplified reporting framework this year, to encourage large businesses to identify energy efficiency savings. In addition to the tax changes, that will further enhance the UK’s ability to reduce its carbon emissions. The Department of Energy and Climate Change intends to publish an impact assessment of the changes later this year, alongside its consultation on a simplified reporting framework. That will include analysis of the impact on carbon emissions. Rebalancing CCL rates towards gas will better incentivise emissions reductions from that fossil fuel, as well.
I will finish by restating, lest there be any doubt, the very firm commitment and strong track record of this Government on reducing emissions. Since 2010 we have reduced the UK’s greenhouse gases by 14% and outperformed our closest European counterparts with the largest cuts in greenhouse gas emissions since 1990. As the hon. Member for Aberdeen North mentioned, we secured the first truly global, legally binding agreement, the Paris agreement, COP21, with our Secretary of State playing a key role. Annual support for renewables will more than double, to more than £10 billion in 2020-21. We are the first major developed economy in the world to commit to phasing out unabated coal, the dirtiest fossil fuel, by 2025. We are the world’s leading player in offshore wind, with just over 5 GW installed, a figure that is forecast to double by the end of the Parliament.
There can be no doubt about the Government’s credentials when it comes to our commitment to reduce emissions. With these tax changes, we have reformed a tax that was proving less effective, over time, with regard to its original aim as stated in 2001, when of course the proportion of renewable electricity generation was so much lower—I believe it was 2.5% in those days. With the changes to business taxation we are keeping the price signal very firm—indeed, making it sharper—by reducing administrative burden. I encourage all hon. Members to support the clauses but not amendment 183.
Question put and agreed to.
Clause 132 ordered to stand part of the Bill.
Clauses 133 and 134 ordered to stand part of the Bill.
Clause 135
CCL: main rates from 1 April 2019
Amendment proposed: 183, page 189, line 13, at end add—
‘(3) The Chancellor of the Exchequer shall conduct a review of the impact of the Climate Change Levy in reducing carbon emissions within 12 months of the passing of this Act.
(4) The report shall have particular reference to—
(a) the removal of the exemption for electricity generated from renewable sources;
(b) the abolition of the Carbon Reduction Commitment; and
(c) reporting requirements by companies and public sector bodies for energy usage and carbon emissions.”—(Rebecca Long Bailey.)
The Economic Secretary to the Treasury (Harriett Baldwin)
Clause 129 increases the standard rate of insurance premium tax from 9.5% to 10% to raise revenue to invest in flood defence and flood resilience.
Insurance premium tax is due on general insurance premiums related to risks located in the UK regardless of where the insurer is based. It is charged as a percentage of the gross premium that an insurer charges, including any broker commissions and other directly related costs—so it is a charge on the insurer, not on the individual.
Insurance premium tax is due on general insurance, which accounts for approximately 20% of total insurance premiums. General insurance includes motor insurance, home insurance, employers’ liability insurance and medical insurance. Approximately 80% of insurance premiums are exempt from insurance premium tax. Exempt insurance includes long-term insurance such as life insurance and critical illness cover. Long-term insurance products are exempt from insurance premium tax to avoid creating a distortion between savings products and long-term insurance products, which can serve the same purpose for consumers. Reinsurance is also exempt to avoid double taxation.
Kirsty Blackman
I appreciate the chance to deal with insurance premium tax. Reducing tax was raised by the SNP at some length last year, when the Government increased it by about 3.5%, from 6% to 9.5%. We were a bit concerned that this amounted to an incredible hike with very little warning, possibly setting a precedent.
I want to make it clear that we are not against spending additional money on flood defences. Given the climate change issues that we face and the devastating impact of floods on communities, we think that is a good idea and we completely understand why the UK Government are choosing to spend money on it. My issue is that raising insurance premium tax might be the wrong way of doing so—I do not want people to be discouraged from taking out insurance. The Minister said that the clause might mean only a minor change in people’s bills, but I am concerned less about the 0.5% increase than about the precedent that has been set by what is happening this year and what happened last year. My main fear is that the UK Government will decide on a further increase.
This morning the Chancellor said that the UK economy was affected by the fact that the markets were currently volatile, and that that volatility would continue. In such circumstances, we do not want people to worry about their future finances, and not to take out insurance because the economy is uncertain and they do not know how the financial situation will develop. It is necessary to have home insurance, just as it is necessary to have motor insurance, but premiums have increased significantly, mostly because of problems caused by climate change. Although the average increase will be £1, people who have been hit by flooding are having to pay massive premiums, and the 0.5% increase is likely to have a disproportionate impact on them.
We do not intend to press the clause to a vote, because we do not want Members to have to stay here longer than they have to, but I appreciate the opportunity to speak about it. Let me end by emphasising that our concern relates to the longer term. Although 0.5% is a fairly minor hike, if the amount continues to rise year on year there will be an additional problem for household budgets, and a negative impact every year.
Richard Burgon (Leeds East) (Lab)
I am pleased to be able to add my contribution to those already made by Members on both sides of the Committee.
As my hon. Friend the shadow Financial Secretary has said, the Bill is rooted in unfairness, and we fear that this tax change may engender further unfairness if it is passed on to customers. Clause 129 increases the standard rate of insurance premium tax from 9.5% to 10%, initially from this October, and all premiums, including those in the special accounting scheme, will be subject to it from February 2017. The Chancellor also announced in the Budget that the funds generated by the increase would be allocated to increased spending on flood defences. What concerns us is how this will affect the insurance market, how it will affect the millions of customers who need access to insurance, and how effectively it will deliver the flood defences that we so desperately need.
This is the third increase in insurance premium tax under the current Chancellor, following increases in 2011 and in last year’s Finance Bill. The first increase was from 5% to 6%, a comparative leap of 20%. Last year’s increase was from 6% to 9.5%, and there was then a 58% leap. This year’s 0.5% increase to 10% is therefore comparatively smaller. Some insurance companies have welcomed the fact that it was not larger, but it follows hot on the heels of the previous change. The frequency of increases is picking up, and that frequency is causing concern.
In March, Ben Flockton of PricewaterhouseCoopers said that of
“concern to many insurers is the prospect of gradual but frequent rate rises.”
David Jordorson, of the Association of British Insurers, said recently that the association had urged
“HM Treasury and HMRC to revisit the arrangements for how rises are implemented”
in order to
“put members on a clearer footing when future rises come”.
Perhaps the Minister will put us straight on whether the Government expect to hold the current rate where it is after the Finance Bill, for the next five years or for just one year—or will we see a further change in the autumn statement? I am sure that the industry, consumer groups and policyholders will be hanging on to our words in this debate.
The latest increase brings the standard rate of the tax up to a total of 10%, which is a doubling—a 100% increase —since 2011. Cumulatively, these three rate rises being passed on to customers would have a real impact on disposable incomes and on policy uptake. We understand that this change will have an impact on 26 million drivers and 20 million households. It will also hit 3 million pet policies and 3 million private medical policies. Our concern is that the industry will pass on this cost to its customers. Moneysavingexpert.com put it bluntly when it said:
“Millions of households and motorists will pay more...a further rise in the cost of pet, car, mobile, contents, buildings and private medical insurance”.
James Dalton, director of general insurance policy at the Association of British Insurers, said:
“Another increase in Insurance Premium Tax would be a raid on the responsible that laser-targets those who do the right thing. It will hit those on low incomes and increase the risk that some people reduce their cover or stop insuring altogether.”
Chas Roy-Chowdhury of the Association of Chartered Certified Accountants said that
“the rise will affect anyone who has home or car insurance wherever they live.”
More recently, in the last few weeks, the AA has published its latest British insurance premium index, covering the first few months of 2016. It found that the average quoted “shop-around” premium—that is, the average of the five cheapest quotes for each customer in a variety of scenarios—had jumped by 5.4% to £114.52 a year at the end of March 2016. So the emerging evidence is of an increase in cost of insurance to the customer.
I will come to the issue of flood defences later, but the Chancellor stated in his Budget speech that this measure was also intended to help to fund the cost of flood defences. I want to raise the issue of flood insurance, including that provided through the Flood Re scheme, which is already increasing costs for customers. Of course we on these Benches support the introduction of Flood Re, but insurers are having to pay a total of £180 million to Flood Re, and that is being passed on. In a survey by the Financial Times, seven out of the 10 largest home insurers said they would pass all or some of the levy directly to customers. I understand that 350,000 properties are currently expected to benefit. We believe it is vital that those in flood-prone areas can access the insurance they need, particularly as the instances of flooding as a result of climate change appear to be on the increase.
What will be the impact of the insurance premium tax and the Flood Re levy being passed on to customers? Our concern is the effect on take-up for those on the margins—that is, those hit by other attacks on income in this Finance Bill, in the Chancellor's Budget and, who knows, in his emergency Budget yet to come, as well as those hit by successive cuts to pay, pensions and protection of welfare payments over the past six years. The Government’s policy paper relating to the change in the Bill states:
“The measure is expected to have a small impact on individuals and households purchasing insurance which is not exempt from IPT, if insurers choose to pass on the IPT rate rise to customers”.
I would like to take this opportunity to ask the Minister what the term “small impact” means. Which individuals and households will be impacted upon? What discussions did the Treasury hold on the likelihood of the increase being passed on to customers, both with insurance providers and with consumer groups?
The Government’s policy paper also says that no equalities impacts have been identified. The Association of British Insurers has highlighted the fact that many families face insurance bills around £100 higher as a result of last year’s increase. We are concerned that this is a tax burden that will ultimately be paid by ordinary people taking the responsible approach and insuring their homes and motor vehicles. What will it mean for those on lower incomes? Will younger or older drivers be disproportionately adversely affected? How will the change’s impact be monitored? Our worry is about the impact of rising costs, contributing to our overall concern about the Finance Bill as a whole. That is why, when the last change to insurance premium tax was discussed in the previous Finance Bill just a few months ago, my hon. Friend the Member for Worsley and Eccles South (Barbara Keeley) tabled an amendment.
Harriett Baldwin
I know the Opposition are having a hard time being an Opposition at the moment, but it can only be left to the imagination how hard they might find some of the difficult choices people have to make in government. We all agree that flood defence spending is an incredibly important part of what we need to do to help our communities. The hon. Member for Leeds East (Richard Burgon) is a Leeds MP, so I would have liked more of a welcome from him for the millions of pounds of additional funding this measure will give fund flood defences in his constituency. I, too, represent a very flood-prone area, with it containing the confluence of the Rivers Severn, Avon and Teme, and nobody in government argues for more money for flood defences more than I do. It is very important that we continue to find ways to make our country more resilient to what will occur on unpredictable occasions when we have the kind of weather that we had last winter.
The hon. Member for Aberdeen North (Kirsty Blackman) was right to point out the importance of flood defence spending. She was concerned about the fact that this Budget raises IPT by 0.5% and asked whether it was our policy to make any further changes to IPT. On that, I will have to give her the standard Treasury Minister answer, which she can probably guess: the Government keep all taxes under review. As others have pointed out, this 0.5% increase is considerably less than was feared at the time of the Budget announcements.
In terms of the availability of flood insurance for homeowners, the Flood Re initiative has been very helpful and beneficial in making sure that homeowners who perhaps in the past found it difficult to access affordable flood insurance are able to continue to access that. That has been very widely welcomed by those homeowners across the country, and I can certainly say in terms of my constituency experience that it is important that people shop around. If their existing insurer is causing difficulties in terms of price changes, it is worth getting in touch with the excellent British Insurance Brokers Association, who can be very helpful in terms of alternatives.
The hon. Member for Leeds East asked about hypothecation and about rate increases. We need to keep this in perspective. Although I welcome the Labour party’s sudden welcoming of lower taxes—something I hope all parties can subscribe to—we do need to raise tax revenues. The hon. Gentleman asked what this will actually cost. For average annual combined contents and buildings insurance, this would add just £1 to the annual bills, or 2p a week. For the average motor insurance premium, it will add just £2 a year or 4p a week. Just going from one petrol station to a slightly better value petrol station can save considerably more than that, which puts this measure into perspective.
I cannot imagine that there is anything more exciting to watch on television at the moment than this debate, but if there is, it may explain why the Chamber is not particularly vigorously attended. However, with those points answered, and given that the link we have made—rather than the explicit hypothecation—means that these measures have been pretty widely welcomed by all commentators, without any further ado, given rival attractions on television, I would like to commend this clause to the House.
Question put and agreed to.
Clause 129 accordingly ordered to stand part of the Bill.
To report progress and ask leave to sit again.—(Margot James.)
The Deputy Speaker resumed the Chair.
Progress reported; Committee to sit again tomorrow.
Business without Debate
estimates
Business of the House (29 June)
Student Loan Repayments
Valerie Vaz (Walsall South) (Lab)
This debate comes against the backdrop of the tumultuous events that took place in the UK following the referendum last Thursday. I applied for the debate before that time, so I am grateful I was granted it and I am here today. I also want to thank the Library for providing timely responses to some of the queries I had.
Just before the historic vote on the EU, students were receiving statements of their loans with a total figure that left many of them in shock. On a loan of £27,000, the figure was £45,000. I want to acknowledge the fact that young people between the ages of 18 and 25 voted overwhelmingly—by 75%—to stay in the EU, so we need to make sure we do not forget them and their future.
I want to focus on the regulations, the threshold and concerns about the contract. The regulations that brought in the changes to the threshold and interest rates were enacted in 2012. They were the Education (Student Loans) (Repayment) (Amendment) (No. 2) Regulations, which came into force in June 2012, so the first students to take up the loans affected by these regulations have just graduated. In those regulations tuition fees were trebled, a higher threshold of £21,000 was established, above which the loan had to be repaid, and a new maximum rate of interest for the loans was set, using the retail prices index plus 3%. Not content to treble tuition fees, the Government in the summer Budget of 2015 froze the threshold of £21,000. I shall focus on that threshold.
In November 2010 the then Minister, David Willetts, made a statement in which he said:
“We will increase the repayment threshold to £21,000, and will thereafter increase it periodically to reflect earnings. The repayment will be 9% of income above £21,000 . . .raising the threshold will reduce the monthly repayments for every single graduate.”—[Official Report, 3 November 2010; Vol. 517, c. 924.]
Then in July 2015 the Government consulted on freezing the repayment threshold. In November 2015 the responses showed that 84% were against freezing the repayment threshold for all post-2012 borrowers, but the Government went ahead against the evidence to freeze the repayment threshold until April 2021.
Why did the Government do that in the face of all the evidence? Is that not a prima facie case of misleading Parliament? In his statement Minister Willetts said that he would increase the threshold, yet the Government acted against all the evidence and the consultation responses. The Government’s own figures on the repayments show the inequity of this. The new scheme is far from progressive, as some Ministers claimed. Graduates earning £21,000 to £30,000 will have to pay £6,100 more, those earning over £40,000 will pay only £400 extra, and those on £50,000 will pay only £200.
Mr Deputy Speaker (Mr Lindsay Hoyle)
I have absolutely no problem with the hon. Gentleman intervening, but he should wait a little longer, rather than walking into the Chamber to intervene. Come on, Mr Shannon—the night would not be the same without you.
Jim Shannon
You are most kind, Mr Deputy Speaker. I spoke to the hon. Lady beforehand. I want to put on record the fact that in Northern Ireland loans begin to be paid back when the student enters employment and earns more than £17,335 a year. The interest rate for loans is currently 1.5% and the more a graduate earns, the greater the proportion of their loan they repay, ensuring that those who benefit most from their degree pay the most, and those who do not benefit as much are not unreasonably punished for it. Does the hon. Lady agree that perhaps the Minister should look at the system that we have in Northern Ireland, which seems to be fairer?
Valerie Vaz
I thank the hon. Gentleman for his intervention. I can say in his defence that most of us were taken by surprise that the Adjournment started so early. I agree with him that the Northern Ireland system seems to be much fairer.
I do not call the figures that I have just given progressive, and nor does the Institute for Fiscal Studies, which found that the impact of freezing the threshold was that the largest increase as a proportion of earnings was among lower earners. Can the Government explain why they have chosen to make the student funding system less progressive by removing the central elements of the 2012 reforms?
What of women, black, Asian and minority ethnic and disabled graduates? They are most likely to be on salaries in the region of £21,000 to £30,000. The Government have acknowledged that. Let me give an example. In the 2013-14 cohort, 8,000 more women than men were paid in that range six months after graduation, and 51% of BAME graduates were employed on salaries in that range, compared with 45% of their white graduate counterparts. What measures have the Government implemented to mitigate the disproportionate effect on those on low incomes, women, disabled graduates and BAME graduates? Those groups earn less than other graduates, so they are more likely to be middle earners—those who face the largest absolute increase in repayments.
What of prospective students in the nursing profession, who could be deterred by high levels of debt? The Royal College of Nursing is concerned about the change to a loans-based system, which will leave many nursing students with debts of £60,000 for a three-year degree. We are desperately in need of nurses from this country who are trained and qualified in this country.
The National Union of Students, which represents more than 95% of all higher education and further education unions and more than 7 million students, has expressed concerns. First, the repayment threshold will not increase in line with earnings, so students have to start repaying their loans on a lower income. Secondly, those on lower incomes pay more than they otherwise would. Thirdly, the NUS is concerned about the Government being able to change terms retrospectively and about the impact that that would have on existing borrowers, which the union says sets a terrifying precedent.
Patrick Grady (Glasgow North) (SNP)
I congratulate the hon. Lady on securing the debate. I declare an interest because, despite having graduated in 2001, I am still paying off student loans, although I fall under the old system, where the threshold is the median wage. However, that means that payments can go up or down, depending on someone’s earnings. I have paid off student debts for a while, gone back down below the median and then re-accumulated interest, which has negated the payments I previously made. However, does the hon. Lady share my concern about the Government’s continual selling-off of student loans? It seems to be a never-ending chain, and it is not entirely clear who benefits, other than the private companies that own these loans.
Valerie Vaz
I absolutely agree with the hon. Gentleman. I am coming to an aspect where student loans are treated differently from any other ordinary loans.
Let me turn to the contract. The Government are asking 17 and 18-year-olds to look at contract terms and understand them. These young people are not financial advisers or lawyers—they are going to university so that they can become financial advisers and lawyers. The role of teachers is to encourage students to go to university, not to give financial advice.
Under the new 2012 system, however, interest rates can vary across the lifetime of a loan, with one rate while the student is studying, another rate when they graduate but are under the repayment threshold, and another rate when they are over the threshold. That is a complicated system, unlike the one described by the hon. Member for Strangford (Jim Shannon), which is much clearer. How can a 17 or 18-year-old be expected to understand these terms, particularly when the table of circumstances is not set out in the contract or attached to it, and students receive no financial advice?
We are told that the guidelines and terms are set out in a separate publication, and the students are told to look at the documents online. The information that is provided and the representations that are made that lead them to sign the contract could be a form of mis-selling. The contract terms could be described as unfair or as “void for uncertainty” because it is not clear on the face of the contract what the student is signing up to—there are no clear terms regarding exactly what they have to repay.
Nor is any financial information provided—for example through a financial adviser. When we take out a mortgage, we have someone sitting down in front of us explaining everything. The students are not given that, but they are expected to sign up to paying back a loan—in some instances, of £45,000. We need to be able to protect our young people.
Worse still, student loans are not subject to financial regulations and consumer protections, as is the case with other loan agreements. That must change, and I say to the Minister that there is an opportunity in the Higher Education and Research Bill to add that extra regulatory protection.
What assessment have the Government made of the exemption of student loan agreements, unlike other loans, from consumer credit protection? Why do the Government not want to protect our young people? Can the Minister confirm whether there are any plans to alter other terms and conditions of the student loans given to existing borrowers? It cannot be right that the Bank of England base rate is 0.5%, when students are paying RPI plus 3% on their loans. How can we treat our young people, who are the future, in this way? No wonder they are bewildered, confused and upset.
A Minister comes to the House to say that there will be an increase in the threshold, and the Government ignore it; the consultation gives an 84% response and the Government ignore it and press ahead with the proposal; and a young person has to sign a form with contract terms in another document online, with three rates of interest. Students should not be burdened by debts but should enjoy the benefits of their hard work and achievements.
The Minister for Universities and Science (Joseph Johnson)
I congratulate the hon. Member for Walsall South (Valerie Vaz) on securing this important debate. Student loans are an important means of ensuring that higher education is open to all. I am glad to have the opportunity to respond to her points and others made in the debate.
This Government have done more than any other to put the financing of higher education on to a secure and sustainable footing. England has some of the finest universities in the world, and it is vital for our future economic prospects that they remain well funded. Total funding for the sector has increased from £22 billion in 2009-10 to £28 billion in 2014-15, and it is forecast to reach £31 billion by 2017-18. We must ensure that our universities have the resources they need and that every student receives a high-quality experience during their time in higher education.
When we reformed student finance in 2011, we put in place a progressive system of student loans that means that higher education is accessible to all who have the potential to benefit from it, irrespective of their ability to pay—and the system is working. Students from disadvantaged backgrounds are going to university at a record rate—up from 13.6% of those from the most disadvantaged backgrounds in 2009 to 18.5% of those same groups today in 2015. Someone from a disadvantaged background is now 36% more likely to go to university than they were under the previous Labour Government. The reforms have supported an increase in participation in higher education across the country. In the hon. Lady’s own constituency, participation has increased from 25.1% in 2010 to 31.4% in 2015. Walsall South now sends a higher proportion of 18-year-olds into higher education than the English average—a reversal of the situation that existed under the previous Labour Government.
The student loans system is fair and sustainable. It removes financial barriers for anyone hoping to study and is backed by the taxpayer, with outstanding debt written off after 30 years. Students get a fair deal. Graduates pay back only 9% of earnings above £21,000 and enjoy an average wage premium of £9,500 per year over non-graduates.
Jim Shannon
In my intervention on the hon. Member for Walsall South (Valerie Vaz), I mentioned that the system we have in Northern Ireland is much more manageable than the system here on the mainland. Has the Minister had a chance to look at how the Northern Ireland example works and gives a better response to students when it comes to repayment?
Joseph Johnson
Yes, of course. Higher education has been devolved in Scotland and Wales since 1999 and in Northern Ireland since 2007, and we continue to look at how other nations within the United Kingdom choose to allocate public funds to the higher education system to see what lessons are to be learned from that.
In England, we now have a fair and sustainable system of funding our higher education system. The £21,000 threshold is higher than the one we inherited from Labour, and is fairer on lower earners. The system is also more progressive. Interest rates after graduation increase with income so that higher earners repay more. For someone earning £21,000 or less, the interest rate is set at RPI—the loan balance does not increase in real terms. For graduates who earn more than this, the interest rate increases to a maximum of RPI plus 3%. It is only fair that the graduates who have benefited most from their education should pay the most back into the system.
Student loans are very different from a mortgage or credit card debt. Repayments are determined by income, not the amount borrowed. Graduates are protected; if at any point their income drops, so do their repayments. The loans are income-contingent, so borrowers will repay only if they earn above the threshold, and, as I said, the loans are written off after 30 years, meaning that many graduates will not repay the full amount. This is a crucial part of the taxpayer’s investment in our country’s skills base.
Our approach is based on the fundamental principle that a borrower’s contribution to the cost of their education should be linked to their ability to pay. Graduates generally benefit from higher earnings than those who do not go to university, and we must ensure that we maintain a fair balance between taxpayers and graduates in the costs of higher education.
It is clearly important that students know what they are signing up to when they agree to take out their loans. All students are provided with clear information to help them understand what financial support they may be eligible for, as well as the interest rates and the repayment terms that will apply. They must also confirm that they understand the information before they are granted the loan. All of the information that the Student Loans Company provides to students is reviewed regularly to ensure that it is both accurate and accessible.
Let me turn to the threshold freeze, which the hon. Member for Walsall South has mentioned. To put higher education funding on to a more sustainable footing, we must ask graduates who benefit from university to meet more of the costs of their studies. It is clear that graduates benefit hugely from higher education. On average, graduate earnings are much higher than those of non-graduates. In 2015, graduates’ salaries averaged £31,500, compared with a non-graduate average salary of £22,000. The only alternative to asking higher-earning graduates to support higher education is to ask the taxpayer, who on average will earn much less than those graduates.
We did not take the decision to freeze the repayments threshold lightly. We consulted on the changes before they were announced last November and conducted a full equalities impact assessment. The changes will mean that graduates earning more than £21,000 will repay about £6 per week more than if we had increased the threshold in line with average earnings. The threshold is higher in real terms than the one we inherited from Labour, meaning that graduates under this system keep more of their earnings before they start to repay.
A sustainable student finance system enabled us to abolish student number controls, lifting the cap on aspiration and enabling more people to receive the benefits of a university education. That is essential if we are to maintain our place as a country with a modern, highly skilled economy. We still send proportionately fewer people to university to study at undergraduate level than our main competitors. Between now and 2022, more than half of job vacancies will be in occupations most likely to employ graduates. If we are to continue to grow our economy, we must equip our young people with the skills and qualifications they will need to fill those roles.
Valerie Vaz
I thank the Minister for his response, but he has not answered my questions and he seems to have ignored the breakdown evidence I have given him, including the fact that those who receive £40,000 pay less. I agree with him that it is very important that more people are going to university, but that does not address the issue of the loans. Moreover, would someone be able to apply for a mortgage with a student loan debt against their name?
Joseph Johnson
The critical thing is that we have put our higher education finance system on a sustainable footing. In order to do that, we had to take some difficult decisions. Freezing the repayment threshold was certainly one of them, but it was rooted in an underlying fairness, which is that graduates, who will go on in their lifetimes to earn significantly more than non-graduates, have to make a contribution towards the cost of running a big, expanding and successful higher education system. If they do not make a bigger contribution, the cost of funding that system will fall back on many of the hon. Lady’s constituents who did not go to university and did not get a chance to have a higher-earning career path over their lifetimes as a result. I am sure she will appreciate that fundamental fairness.
Valerie Vaz
This is about a difference in ideology. I was lucky to benefit from a free education. I went to university without having to pay for anything. In fact, because I stayed at home, I actually saved on my grant, which is slightly unusual. The taxpayer does not have to pay, because graduates will pay a higher rate of tax when they graduate, so they will be putting more back into the economy. Burdening students with a debt of £45,000 when they start their lives is not the right way.
Joseph Johnson
The hon. Lady was fortunate, in that she went to university at a time when the country had a much smaller system. As a percentage of the 18 and 19-year-old cohort, when she went to university, I imagine that a very much smaller proportion went to university at all. Now, we are in the mid-40s as a percentage of that cohort. It is a big system to run.
If we make the cost of that system fall solely on the taxpayer, we will put a much bigger burden on those who have not benefited from the higher earnings path to which being a graduate gives access. For women, as the hon. Lady will be aware, the lifetime earnings of a graduate are likely to amount to some £250,000 more than those of a woman who did not go to university. For a man, the difference is something like £170,000 more over their lifetime. Going to university puts people on a significantly higher earnings path, which makes the amount of debt that they might take on, on an income-contingent basis, look relatively small by comparison. When we think about this, it is important to set the huge lifetime gains from higher education against the sums of debt that people take on to generate them.
England is not unique in grappling with these problems. However, according to experts in the financing of higher education systems, such as the OECD, we are one of a very few countries in the world to have found what is deemed to be a sustainable solution to funding a mass higher education system. That has been recognised internationally. The OECD has praised our student loan system in England as that of
“one of the few countries to have figured out a sustainable approach to higher education finance”.
The hon. Lady mentioned bursaries and funding for health students. The present system is simply not working for patients, for students or for the universities that train them. To deliver more nurses and other health professionals for the NHS, a better funding system for health students and a sustainable model for universities, we need to move health students’ grants and bursaries on to the standard student support system, as we have for all other degrees. That will allow us to move away from centrally imposed student number controls and financial limitations. As a result, the Department of Health expects the measure to enable up to 10,000 additional nursing, midwifery and other health professional training places over this Parliament. That is just one example of why we have one of the best and most sustainable higher education systems of anywhere in the world.
Question put and agreed to.
Draft Electricity Capacity (Amendment) Regulations 2016
The Minister of State, Department of Energy and Climate Change (Andrea Leadsom)
I beg to move,
That the Committee has considered the draft Electricity Capacity (Amendment) Regulations 2016.
The draft regulations seek to amend the main secondary legislation package for the capacity market scheme, which was part of the electricity market reform programme in 2013. The powers to make this implementing secondary legislation are found in the Energy Act 2013, which, following scrutiny in the House and the other place, received Royal Assent in December 2013, with cross-party support.
As a reminder to hon. Members, the capacity market will address our electricity needs and ensure that there is sufficient electricity supply towards the end of the decade and beyond. It will achieve that by making a regular capacity payment to providers that are successful in capacity auctions. In return for that payment, providers must meet their obligations to provide supply or to reduce demand when the system is tight, ensuring that enough capacity is in place to maintain security of electricity supply. Ensuring that hard-working families and businesses across the country have secure, affordable energy supplies that they can rely on is our top priority, which is why we already have firm mechanisms in place, working closely with National Grid and Ofgem, to maintain comfortable margins on the system in the coming winter.
Beyond that, it is essential that generators have confidence that they will receive the revenues they need to maintain, upgrade and refurbish their existing plant, and to finance and build new plant to come on stream as and when existing assets retire. Equally, we want to ensure that those who are able to shift demand for electricity away from periods of greatest scarcity without detriment to themselves and to the wider economy are incentivised to do so. That is why we have the capacity market.
The first two capacity market auctions took place in 2014 and 2015, and the first of two separate auctions focusing on demand-side response took place at the beginning of 2016. Those resulted in a good outcome for consumers, as fierce competition between providers meant that we obtained the capacity we need at prices below the levels many had expected. That translates to lower costs on consumer bills.
In order to ensure that the capacity market remains fit for purpose, my Department has reviewed the capacity market mechanism in the light of the experience gained in those first auctions. The clear message from industry and investors is that the mechanism retains their confidence and is the best available approach for ensuring our long-term security of supply. They also stressed that regulatory stability is crucial. At the same time we heard concerns that we must do more to protect against delivery risks, that we need to tighten the incentives to honour agreements for those that have been awarded them, and that we must avoid the risk of under-buying or buying too late.
UK electricity market conditions have changed considerably since 2014, when the capacity market was established. The huge reduction in global commodities prices has lowered consumers’ energy costs but pushed many generators into loss-making territory. As a result, several plant closures have been announced earlier than was anticipated in 2014, and other generating plant may be at risk.
In order to address those points, these regulations will provide for a new supplementary capacity auction for delivery of capacity in 2017-18, together with minor reforms to help the capacity market deliver its objectives. In the context of those amendments, it is important to consider the capacity market as an insurance policy against a material risk of plant closures. As with all insurance policies, there is a premium to be paid. However, this premium is worth paying to ensure a secure and affordable electricity supply.
The risk that we are ensuring against is largely the result of recent declines in wholesale market prices. We should remember that this in itself has led to welcome reductions in energy bills for consumers. The insurance premium they are being asked to pay now is only a small fraction of those benefits. What is more, as with all insurance policies, we must be sure that the insurance will pay out in times of need. That is why we are today debating amendments to the regulations that will increase termination fees for those who renege on their capacity market agreements. The amendments further incentivise capacity market participants to deliver on their commitments and contribute to our security of supply.
I will briefly expand on the amendments. First, the regulations make provision for a supplementary capacity auction to be held this coming winter for delivery in 2017-18. Running that auction mitigates the emerging increased risk to security of supply in 2017-18 by ensuring that enough capacity is available that year. It acts as an insurance policy against a material risk of plant closures because of low wholesale prices. Our analysis shows that that approach is expected to be up to £8.4 billion cheaper than an alternative scenario in which further plant closures would have occurred.
The regulations also provide for a number of amendments in the light of my Department’s review of the capacity market. Our public consultation exercise outlined the need for a robust system of checks, both on new build projects, to ensure that they are on track to deliver, and on existing plant, to ensure that agreements are honoured. At the same time, the consultation recognised the importance of ensuring that the system is not so punitive that legitimate projects will be dissuaded from participating in the first place.
We have evidence that, despite the termination fee regime already in place, there have been instances when capacity providers have viewed their obligations as relatively low-cost options and have contemplated reneging on their commitments. I am therefore proposing measures to help ensure that new build capacity that wins a capacity agreement has the appropriate incentives, and is exposed to a robust assurance regime, to deliver against their agreement.
These measures include increases in credit cover for projects that cannot demonstrate sufficient progress against the required milestones, and limited but material increases to the termination fees that all those with an agreement must pay if they renege on their commitments. Through the supporting capacity market rules, I am also proposing a prohibition on failed projects from participating in future auctions, and also increased monitoring and reporting milestones.
The regulations must also include measures to make sure that a secondary trading market can develop that supports investment in capacity market units. Those changes will improve the current regulatory framework by dealing with the interaction between transfers of agreements and the penalty regime.
Finally, the transitional arrangements auctions are aimed specifically at the demand-side response sector, recognising that it is a relatively small and immature sector at the moment. We are keen to ensure that funding provided through the next transitional arrangements auction is targeted at those types of resource that need it most. The regulations therefore refine the eligibility criteria for the second transitional arrangements auction so that it focuses on genuine demand-shifting, turn-down demand-side response, rather than the small-scale generation, including diesel, that won many of the agreements in the first auction.
My Department consulted on the changes across two consultations in October 2015 and in March this year. In total, more than 200 responses were received across the two consultations. There was significant support for the majority of the Government’s proposals, particularly the supplementary capacity auction for refinements to the eligibility criteria for the second demand-side response transitional arrangements auction and the core proposals relating to delivery incentives. These regulations implement the proposals. I look forward to hearing what hon. Members have to say about the proposed changes.
Dr Alan Whitehead (Southampton, Test) (Lab)
As the Minister has set out, we are discussing a new auction to be put in front of the existing T-4 auctions, which will remain in place, in order to auction capacity four years in advance of the performance of that auction capacity. The purpose of T-4 auctions—I am sorry that the Minister did not mention this—is essentially to procure new capacity that can be on stream at the end of the T-4 period. That new capacity will get its underwriting so that it can be built in the three-year period before the last T-4 auction. That will incentivise building and production, and that is what the underwriting 15-year contracts will consist of. Those 15-year contracts would run alongside shorter term contracts intended to maintain capacity, but that is the central purpose of the original auctions.
An additional auction will now be in place before the T-4 auctions have run their term, but after they have started, in order to secure capacity on one-year contracts only—no 15-year contracts are available in this pre-auction. As the Minister said, that is simply to prevent, among other things, plants from being mothballed or closed down, so that they can continue to supply capacity even when we were hoping that the capacity from new plants would be coming on stream. This arrangement represents, at the very least, substantial mission creep on the original purpose for capacity auctions.
Not only is it mission creep, but it replaces a fairly well placed device, the contingency balancing reserve, which, even in the context of the original T-4 auctions, was in essence a guarantor that reserve capacity would be available outside the market, and largely bid for by, and separately placed with, plants that might otherwise have been mothballed or closed. As a result, in the period running up to the new plants becoming available, there will be sufficient capacity and reserve to ensure that the loss of load is not significant, so that we are within the limits and, indeed, have a fairly robust method of ensuring that the capacity margins are upheld in that period before the emergence of the new plants.
Something else the Minister did not mention when describing the draft regulations is what has actually happened with the original two T-4 auctions. To all intents and purposes, no new capacity has been procured under the auctions, with the exception of one plant, which does not look as if it will be built, because it bid into the system without having a clear way forward to add to the bidding and to invest in the plant. Overall, however, the vast majority of the contracts were the sort of one-year contracts that it is now envisaged will be the substance of the auction in front of the T-4 auctions.
Not only were they one-year contracts, but they were contracts that have gone to all sorts of producers—coal, gas and, surprisingly, nuclear. We have underwritten existing nuclear power plants to provide capacity, when it would be difficult to envisage how they could fail to provide capacity when required to do so. They would have to switch themselves off and close down for long periods in order not to provide capacity. So the first auctions have a rather perverse outcome, and the proposals essentially start to install those perverse outcomes into a continuing process for capacity auctions.
The first two auctions cleared at relatively low prices, as the Minister mentioned. She states that they were good value for customers, and one might view that outcome—clearing at £20.30 per kilowatt and £18 per kilowatt respectively—as good value, if one did not know what the original purpose of capacity auctions was. Arguably, that good value falls away if no new plants arise from the capacity auction and it is consumed entirely in short-term contracts, some of them for completely inappropriate forms of capacity going into the system.
The mission creep that we see in the regulations before us essentially means that their purpose, as the Minister suggested in her remarks, appears to be keeping plant open and preventing contractors from closing plant, rather than opening new plant. Furthermore, they are trying to bolster the idea—I do not disagree with it—that those who contract to provide power, particularly in a T-4 or 15-year auction but even in a one-year auction, ought to carry out that contract. Dangers have been suggested. A number of contractors have been considering the fact that the penalties for non-performance are considerably less than the potential savings from mothballing a plant; one has actually done the dirty deed. The extent to which the arrangements cause people to keep their plants open has begun to fray. I therefore support the proposals in the regulations to make penalties more appropriate to the power being provided, with high penalties for non-performance.
However, the central question is what analysis has been done of that mission creep to ensure a system that gives us energy security over the next period and reasonably good value for the consumer. By the way, I support the other consideration in the regulations: the question of organising demand-side auctions in a way that is more favourable to demand-side entrants who have had difficulty taking part in the general auction, and who have to some extent been superseded by would-be demand-side entrants that deal with things such as diesel plant. I support the sense of putting that into the system.
I would like to ask the Minister a couple of questions about how the benefit of the proposals has been arrived at. To find that out, we must once again look at an impact assessment, and I am pleased to see that on this occasion we actually have one. That is good. However, the impact assessment has been set against a rather strange counterfactual. If more plants close than predicted, prices will be pushed up, but the instrument might cause fewer plants to close and prices will therefore not go up to such an extent.
However, the impact assessment suggests that if fewer plants close the net welfare could, under some circumstances, be negative. In any event, as the document presents, the very fact that a new capacity auction has been announced causes operators to decide not to close or mothball plant. The counterfactual is therefore undermined by the idea itself, and that seems to be a strange way to conduct an analysis of what the cost is and should be. Indeed, all that the counterfactual arrangements do, in the end, is come out with the difference between a very high cost to consumers and a relatively high cost to consumers.
Can the Minister tell me how reliable she thinks the cost suggestions in the impact assessment are? The Committee ought to think carefully about the suggestion that the likely cost, for this auction alone, is between £2 billion and £3 billion. Over the past few weeks we have debated the gross and net costs of contributions to the European Union, but this is of a different order—it translates into a gross cost of between £28 and £38 on a household electricity bill. That would have an enormous impact on consumers and would dwarf many relatively minor impacts, such as the incentives for renewables to deploy.
However, even if we take the net benefit, which assumes that wholesale prices will be lower as a result of the measure than if no measure was taken—an interesting supposition and perhaps not a safe way of calculating an impact—it is still suggested that the impact on consumers’ bills will be between £10 and £21. So at the very least the impact is enormous, even if the changes are considered in the best light.
I have one final question for the Minister. Even in the context of one-year contracts only, the impact assessment sets out an assumed clearing price for the auction, on which all the calculations are modelled, of £62. Would it be a good outcome for consumers to have a clearing price for one-year contracts that would have been high enough if it was a T-4 auction to gain some new long-term contracts, which was the original idea of capacity auctions? It looks like we might now be getting an auction at very high clearing prices, with no long-term contracts let and under circumstances in which the consumer pays a heavy bill. Will the Minister comment on how we have come to that?
We will not oppose the statutory instrument, but there needs to be close examination and an explanation of the central issue of how the modelling took place to reassure hon. Members and the public that there is value for money and that it is better than the alternatives.
Finally, not only are the counterfactuals as I have described them, but, interestingly, the counterfactual of continuing with the contingency balancing reserve, which I mentioned a while ago, is set against one-year prices, as opposed to what was originally set out in the Energy Bill as a full-blown strategic reserve, rather than a capacity auction. That seems to be a much better counterfactual on which to compare and contrast value.
The whole thing therefore reeks of mission creep not just as far as the measure is concerned, but as far as the analysis of the measure is concerned. That is a worrying development in policy. I am sure that the Minister will want to respond to that and consider it carefully in respect of her future arrangements for capacity auctions.
Philip Boswell (Coatbridge, Chryston and Bellshill) (SNP)
It is a pleasure to serve under your chairmanship, Mrs Main. I will keep this brief, but I will ask the Minister a few questions. First, what likelihood does she see for favourable—in the UK’s opinion—European interconnector negotiations for the optimisation of Europe-wide electricity supply and demand, given that the UK is currently marching away from the EU?
On storage, given the Government’s extensive cuts to renewable energy initiatives, what funding will they provide for energy storage in the UK? In particular, is there an intent to put in place appropriate funding mechanisms, if they are not in place, for the two major Scottish pump storage projects at Cruachan and Coire Glas that are ready to go? What adjustment, if any, are the Government planning to make to remove the unfair transmission charges currently applied to Scotland, which played a part in the closure of Longannet? Of course, that is part of the reason we are here discussing how we tackle energy shortage issues in the UK.
Finally, we will not oppose the statutory instrument for the reasons that were so well articulated by the hon. Member for Southampton, Test.
Andrea Leadsom
I am grateful to hon. Members for their comments and questions. It will be a great pleasure to answer them all and hopefully my answers will please hon. Members.
The hon. Member for Southampton, Test asks whether there is mission creep. The capacity market is there as an insurance policy for energy security. It is true that it has the secondary goal of bringing on new investment in new, lower-carbon plant, but its core goal is as an insurance policy that ensures that the lights stay on. As he pointed out, a 15-year deal is not available in the supplementary capacity auction. The reason is that, because it is only for 2017-18, there is not time to build the plant and start dispatching electricity between now and the delivery date. However, the T-4 auctions are indeed designed not only to provide energy security, but to bring on new investment.
The hon. Gentleman says that that has not been successful, but that is not true. We have had a variety of new build plants, including more than 800 MW of small scale gas and the CCGT that he mentioned. It is crucial that we provide opportunities for new investment, which is why we have announced separately that we will buy more capacity and do so earlier. We will announce shortly what that means for the next T-4 auction.
The hon. Gentleman talked about the counterfactual of the supplementary capacity auction versus the £8 billion cost of early closure. To be clear to all Members, he is exactly right that our best estimate of what the supplementary auction will cost is £2 billion to £3 billion. It is very difficult to assess exactly what that means per consumer bill, but it will be in the region of £11 to £20. As he has acknowledged, the reason for having the auction is the drop in wholesale prices, which has meant that the economics for wholesale generators have been difficult. In fact, the average dual fuel bill is roughly £200 a year lower than it would have been. We cannot be clear about what the bill impact will be, because it is subject to a competitive auction, but our estimate is that it will be between £11 and £20, which is less than 10% of the reduction in wholesale costs for consumers. In net terms, it is a very good deal for consumers and provides energy security at a time of low wholesale prices.
Dr Whitehead
I would be grateful if the Minister confirmed that the estimate she has just given is post the estimates about the dampening effect of wholesale prices of this particular measure, and not the gross effect of what the measures might produce. That is to say, this is the figure after that presumed effect is deducted, and if that presumed effect was not deducted, the cost would be substantially higher to consumers.
Andrea Leadsom
I will have to write to the hon. Gentleman on that point. I am not sure I completely understand his concern. The impact assessment is clear that our best guess is that the bill impact will be in the region of £11 to £20. I have just been informed that that is net. I will write to him if he wants a fuller answer, but I hope that clarifies things.
The average dual fuel bill is £200 lower than a year ago as a result of lower wholesale prices, which make it more difficult for wholesale generators to cover their costs. Bringing forward the supplementary capacity auction will therefore ensure that there is security of supply. The best estimate is that that will cost £11 to £20 per bill, which is very good value for consumers.
The hon. Gentleman also questioned the £8 billion counterfactual. That £8 billion counterfactual assumes that we do not bring forward the supplementary capacity auction. There would therefore be nothing available for wholesale generators, and they would have to deal with the consequences of the poor economics of low wholesale prices. He asked about the contingency balancing reserve. Our estimates show that it would be more expensive than the supplementary capacity auction. That is why we are doing this. The SCA is more cost-effective and provides energy security. I hope that that answers his questions.
The hon. Member for Coatbridge, Chryston and Bellshill asked about interconnector links. I can tell him that they will go ahead. I confirm for all Members that my view is that energy policy will not be impacted at all by the public’s decision to leave the European Union, because we will continue to have our energy trilemma and our commitments to decarbonisation at the lowest possible price, to energy security and to interconnectors, which after all are all commercial decisions made between businesses. Our policy for more interconnectors will endure, provided that Ofgem finds on a case-by-case basis that they offer good value to consumers.
Callum McCaig (Aberdeen South) (SNP)
That is interesting. May I ask whether the Minister envisages the emissions trading scheme continuing?
Andrea Leadsom
Obviously, the emissions trading scheme is an EU-wide scheme, and the UK’s participation will be subject to the negotiation of the terms of our leaving the European Union. There has been a lot of discussion in this very room about the ETS, the amendments the UK would ideally like to make and whether it should count towards our decarbonisation goals at all. I say to the hon. Gentleman that those discussions are not for today, but will of course be part of the negotiation.
The hon. Member for Coatbridge, Chryston and Bellshill raised the question of storage and, as I have said to him before, we remain completely committed to that. The Department believes that storage presents a huge opportunity to provide the certainty that intermittent technologies cannot provide for energy security. We are big supporters of it. Work is going on in the Department to look at what we can do to facilitate storage and to remove any barriers, whether regulatory or structural, to allowing storage to deploy. I hope he will appreciate that nothing has changed and that that enthusiasm will continue. I think I have mentioned to him before that I have met all the trade bodies and developers for storage to hear their views, and we are completely supportive.
Callum McCaig
I am interested in that answer. Is there any indication of the timescales for that review and of what any forthcoming changes may be?
Andrea Leadsom
I am so sorry, but I have to say to the hon. Gentleman that we will announce that as soon as possible. He will be aware that there are a number of announcements that we are keen to make as soon as we can. Some of this work is very complicated and we are keen to get the right answers. During the passage of the Energy Bill, we had a good discussion about storage. We are all on the same side; we all want to see progress. The key thing is to make sure that we get solutions that benefit the deployment of storage and that there are no unintended consequences of the solutions that we choose; it is important that they do not have the opposite effect. We have had that discussion before, so I will leave it there.
The final point made by the hon. Member for Coatbridge, Chryston and Bellshill was on transmission charges for Scotland. As he knows, the transmission charging regime is a matter for Ofgem. As he also knows, it is designed to be cost reflective to ensure the economic and efficient use of the network across Great Britain and, importantly, to keep costs down for consumers. It is true that there are higher charges for generators in Scotland as a result, but that reflects the actual cost that those generators impose on the transmission network. He will also be aware that the greater part is paid by the electricity supply companies, also on a cost-reflective basis. That means that the majority of transmission charges are in fact recovered through consumers in areas of highest demand—namely in England and Wales. Although generators pay more in Scotland, consumers pay less. Ofgem has concluded, having done a recent study on transmission charges, that there would be winners and losers from any change away from cost-reflective charging, and it does not feel as if there is a case for that.
I hope that the responses I have given have been helpful. As I said at the start of the debate, I am confident that with the changes we have discussed today, the capacity market will ensure the security of our electricity supplies in a way that provides the best value for money for consumers. I therefore commend the regulations to the Committee.
Question put and agreed to.
Resolved,
That the Committee has considered the draft Electricity Capacity (Amendment) Regulations 2016.
Children’s Centre services in Corby
Development on the former Two Trees High School site, Denton
House of Lords
Death of a Former Member: Lord Mayhew of Twysden
The Lord Speaker (Baroness D’Souza)
My Lords, I regret to inform the House of the death of the noble and learned Lord, Lord Mayhew of Twysden, on 25 June. On behalf of the House, I extend our condolences to the noble and learned Lord’s family and friends.
Universities: Anti-Semitism
Lord Leigh of Hurley
To ask Her Majesty’s Government what steps they are taking to counter anti-Semitism on university campuses in the United Kingdom.
Lord Leigh of Hurley (Con)
My Lords, I beg leave to ask the Question standing in my name on the Order Paper and, in doing so, draw your Lordships’ attention to my interests in the register.
Baroness Evans of Bowes Park (Con)
There is no place in our society for bigotry, hatred or any form of racism, such as anti-Semitism. Higher education institutions are committed to challenging intolerance on campus. They have a clear responsibility under the Equality Act 2010 to provide a safe and inclusive environment. Universities UK has established a task force to consider further measures to address harassment on campus, and it will report in the autumn.
Lord Leigh of Hurley
I thank my noble friend for her helpful Answer. Will her department consider the basis of the definition of anti-Semitism to be that proposed by Sir Eric Pickles and subsequently adopted by the UK College of Policing and the International Holocaust Remembrance Alliance? It specifies that anti-Semitism manifests itself when double standards are applied to the state of Israel, requiring of it behaviour that is not expected or demanded of other democratic nations. Will the Minister assure us that it cannot be right that British Jewish students in universities should be intimidated by overaggressive anti-Israel activity on their campuses?
Baroness Evans of Bowes Park
My noble friend is right: the definition Eric Pickles used was the EUMC working definition, which provides a valuable description of some of the ways contemporary anti-Semitism is manifested. He is also right that it has been included in operational guidance for the police since 2014. Universities may well want to consider it. One of the issues that the Universities UK task force, which I mentioned in my previous Answer, is looking at is how better training can be undertaken for university staff to help them understand the many different forms that anti-Semitism can take.
Lord Anderson of Swansea (Lab)
My Lords, the president of the National Union of Students sets a deplorable example. Is the Minister aware that in the past few days a Jewish law student at the University of York has obtained £1,000 and an apology from the student union? Is it not wrong that an individual student had to take up this case himself? Although I do not know the position in the University of York, does she agree that it is often the weakness of vice-chancellors, who refuse to promote the ideas of toleration and of universities as places of understanding, that is at the root of this problem?
Baroness Evans of Bowes Park
I thank the noble Lord for that question. I am pleased, excepting what Zachary had to go through, that he got an apology and compensation, but I entirely agree that it is unacceptable for students to have to face this. Incidents of anti-Semitism must be taken seriously and investigated swiftly. Many universities do that, but the new Universities UK task force, which I mentioned, is looking at what more can be done. It is considering a number of specific actions in relation to anti-Semitism: an improved need for data collection to ensure that incidents are recorded effectively; the importance of a complaints procedure that protects the identity of students who are fearful of coming forward; and, as mentioned, the need for better training to make sure that university staff understand the different forms that anti-Semitism can take because it is not acceptable on university campuses.
Lord Singh of Wimbledon (CB)
My Lords, while sympathising with members of the Jewish community who have been ill-treated, does the Minister agree that they are not alone in frequently being subjected to abuse and discriminatory behaviour in universities and elsewhere? It is the duty of the Government to ensure that all communities are equally protected against irrational hatred and abuse, particularly in today’s unpredictable and difficult times.
Baroness Evans of Bowes Park
I agree with the noble Lord. Indeed, the Universities UK task force is looking at harassment on campus and, in particular, at what more can be done by the HE sector to prevent and respond to incidents of violence and sexual harassment against women, hate crimes generally and other forms of harassment, including anti-Semitism and Islamophobia. This task force is looking at a broad array of issues to ensure that the HE sector ensures that students can live and learn safely in a spirit of tolerance and understanding.
The Lord Bishop of Chelmsford
My Lords, in my diocese, a pro-Palestinian student body forced the University of Essex in 2013 to cancel a speech from the Israeli deputy ambassador over concerns about his safety. While, of course, fully supporting what the Government are doing in this area, how can freedom of speech and extremism be more clearly distinguished so that we can take appropriate action against racism and anti-Semitism of all forms but also maintain academic free speech?
Baroness Evans of Bowes Park
I completely agree that freedom of speech and academic freedom are the bedrock of our higher education system. We fully support universities that show strong leadership in allowing controversial and sometimes offensive ideas to be aired, but most importantly debated, to make sure that universities are doing what they should be doing, which is robustly challenging theories and making sure that students can argue and talk down hatred that is being perpetuated.
Baroness Garden of Frognal (LD)
My Lords, the life-changing referendum result indicates a nation which is less tolerant and less accepting of diversity. What dialogue is the Minister having with universities to ensure that a proper complaints procedure is in place so that anyone suffering from anti-Semitism knows exactly where they can go?
Baroness Evans of Bowes Park
As I said in a previous answer, the Minister for Universities and Science has specifically asked the Universities UK task force to consider some specific actions. One is improved collection of data about incidents, so we can make sure we understand the scale of the problem, and another concerns the importance of a complaints procedure that protects the identity of students who are fearful of coming forward. The task force is planning to provide a range of recommendations and actions to Ministers in the autumn. Universities UK is planning a national conference post-the publication of those recommendations, in November, so that there can be a full discussion of the issues that it has found in the evidence it is collecting.
Lord Woolf (CB)
My Lords, I disclose an interest as patron of the Woolf Institute, which is devoted to improving interfaith relations, primarily between the Abrahamic faiths. I note the very clear answers that the Minister has given, for which I thank her, and note what is implicit in the questions asked by other noble Lords. But I would like to know whether she agrees that, although Universities UK plays a very important role, it is also very important that the Government should show, in a material way, that they support what others are trying to do?
Baroness Evans of Bowes Park
I hope very much that my answers today show that the Government are taking this seriously. We asked Universities UK to set up this task force and will be listening very carefully to its recommendations. We want to see a tolerant environment where students can learn. We take the seriousness of this issue fully on board, and I hope I have shown today that the Government are indeed making it a priority.
Terrorism: Terminology
(8 years, 5 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Singh of Wimbledon
To ask Her Majesty’s Government what assessment they have made of whether action to combat the threat of terrorism could be helped by a clearer use of language, for example by explaining the actual meaning of words such as “extremism”, “radicalisation” and “fundamentalism”.
The Parliamentary Under-Secretary of State, Department for Transport and Home Office (Lord Ahmad of Wimbledon) (Con)
My Lords, since 2011, we have introduced the Prevent duty and trained more than 450,000 people, including front-line workers, to spot the signs of radicalisation. We also published the counterextremism strategy last year, which explains how we are working with communities to build an understanding of the threat of extremism and the challenges that it poses.
Lord Singh of Wimbledon (CB)
I thank the Minister for the reply explaining the Government’s position. However, for years we have had a Prevent programme, as he mentioned, without clearly defining what we are trying to prevent. Words such as “radical”, “deradicalise”, “fundamentalist” and “extremist” are totally devoid of meaning, while the terms “political Islam” and “Islamist” are considered by many Muslims to be derogatory to Islam. Does the Minister agree that what we are really trying to prevent is the out-of-context use of religious texts that advocate the killing or ill-treatment of people of other faiths? Furthermore, does the Minister agree that to suggest that such behaviour is sanctioned by the one God of us all is the ultimate blasphemy? Finally, will the Government help Muslim leaders to present Islam in the context of today’s society?
Lord Ahmad of Wimbledon
Picking up on a couple of the noble Lord’s points, I am sure that I speak for everyone across the House when I totally agree that no true religion in any sense sanctions the kind of extremist, and indeed terrorist, activity that we see, and Islam is no exception. Indeed, we have seen Muslim leaders of every denomination condemn unequivocally such heinous actions. In his final point, the noble Lord talked about the understanding of Islam. It is very much for the Muslim community and the leaders within it to have a discourse about Islam. Islam is a religion that is practised not just in this country but by almost 1 billion people around the world, and is practised peacefully.
Lord Paddick (LD)
My Lords, the Government maintain that the programme to prevent people being drawn into violent extremism is focused not on the Muslim community but on all types of extremism, wherever it occurs. If that is the case, can the Minister tell the House why the Prevent programme is not implemented in Northern Ireland and why, as part of the programme, the Government are conducting a survey among the Muslim community only?
Lord Ahmad of Wimbledon
Taking the noble Lord’s second point, the Government are not conducting a survey with the Muslim communities only. That has been the media speculation, but it is not the case. On his first point about Northern Ireland, he mentioned Prevent, but other initiatives have been taken in Northern Ireland that deal with the quite unique circumstances on the ground there.
Lord Rosser (Lab)
The Independent Reviewer of Terrorism Legislation, David Anderson QC, has previously said that elements of the Government’s Prevent programme are,
“ineffective or being applied in an insensitive or discriminatory manner”,
and that the programme could benefit from an independent review. The programme’s intention is to address all forms of terrorism and non-violent extremism. However, the climate of the last few weeks has done nothing to ease the situation that Prevent is intended to address, and unfortunately there is all-too-clear evidence that that climate is continuing in the wake of the referendum result. Do the Government now intend to carry out a full review of the Prevent strategy in the light of David Anderson’s comments?
Lord Ahmad of Wimbledon
This Government have focused, as previous Governments have, on the importance of Prevent, which has seen much success. As I said, 450,000 people have been trained. More importantly, what has it delivered? There have been more than 50,000 interventions, and 180,000 pieces of terrorism material have been removed from the internet. Of course, every strategy and policy needs to be reviewed, and the Government continue to do so. I share the noble Lord’s sentiments. In any environment, particularly the one in which we currently operate, no extremist and no person who seeks to use an opportunity should build on the fears of communities and society or target any community in Britain.
Lord Tebbit (Con)
My Lords, nobody in this House is better equipped than the noble Lord to get people to understand that the present version of the Muslim religion arises largely from a dispute within that religion and that it is a gross perversion of the Muslim religion practised in the 13th and 14th centuries, for example. We should all remember that, just as we should all remember that there are very few places where one can feel safer in the face of extremism in this country than in the company of a large number of Sikhs, who have always shown by their great loyalty and understanding of this society that they have their place here.
Lord Ahmad of Wimbledon
There are many advocates across all faiths who stand up for faith, and indeed for no faith, and they do so for other faiths as well. That is the beauty of our country. I am proud of Britain. I believe that this country is the best place to be a Muslim, a Hindu, a Sikh, a Jew or a person of no faith. That is because it is based not just on tolerance but on understanding and building mutual respect, and long may that last.
The Lord Privy Seal (Baroness Stowell of Beeston) (Con)
Did the noble and learned Baroness give way to the noble Lord? The House was calling for the noble and learned Baroness, but if she has given way she has given way.
Baroness Butler-Sloss
I thank the noble Baroness. I had not given way; I just thought it was polite to sit down. I am the chairman of the Commission on Religion and Belief in British Public Life. Across the country we have discovered the importance of talking to people with whom we do not agree. Will the Minister make sure that the Government talk to groups of whom they do not approve and who have very different views? Communication and dialogue are crucial in these matters.
Lord Ahmad of Wimbledon
I assure the noble and learned Baroness that I am often in conversation with people with whom I disagree. Going back to my earlier answer, I think that our society is based on mutual respect. That is born out of the fact that people may have contrary opinions but we sit down with them, listen to those opinions and find a solution. The Government have been instrumental in building and strengthening partnerships with all faith communities, including the Muslim community of all denominations, to meet the challenge that we currently face.
Air Quality
The Earl of Courtown (Con)
My Lords, cleaner air is a priority for this Government, and we are taking action at all levels. We are working with local government to implement a new programme of clean air zones, alongside £2 billion committed since 2011 towards cleaner transport and supporting local authority action. We have led EU action to introduce real-world driving emissions testing from 2017, and are working to agree ambitious and fair limits to reduce emissions further in future.
Lord Dubs (Lab)
My Lords, the Minister will be aware that some 50,000 people a year die because of diseases connected with air pollution. Does he agree that diesel engines bear particular responsibility for these deaths? Is it not time that we stopped subsidising indirectly the use of diesel cars and had some penal taxation to discourage such vehicles? Given that we are still members of the EU, could we not approach Brussels—the Commission and the Council of Ministers—to ask for some tougher measures to deal with air pollution on a Europe-wide basis?
The Earl of Courtown
My Lords, the noble Lord is quite right that the effects of pollution on the health of our children and families is something that we must concentrate on. As I said in my opening Answer, we are working with local government to implement a new programme of clean air zones in Birmingham, Leeds, Southampton, Nottingham and Derby.
The noble Lord, Lord Dubs, mentioned diesel vehicles. As he will no doubt be aware, under the clean air zones we are going to be discouraging older vehicles from entering those areas. He also mentioned bringing to the attention of Brussels the issue of the relationship between diesel and pollution. I am sure that they are aware of this matter but we will take that back.
Baroness McIntosh of Pickering (Con)
My Lords, does my noble friend agree that the UK Government were willing signatories to the EU air pollution directive and that we will remain committed to its aims and objectives? In addressing issues such as acid rain and air quality, European environmental policy has had a great impact in creating a cleaner environment in the UK.
The Earl of Courtown
My noble friend is quite correct, but she will also be aware that the environment that we have in this great country of ours goes back many years before we joined the EU as well. In fact, the Clean Air Act was introduced in 1956.
Baroness Walmsley (LD)
My Lords, will the Minister ensure that the future so-called European deal will contain air quality regulations that are at least as good, if not better than, those that we currently have under the EU regulations? We cannot rely on the World Health Organization standards because they are not enforceable. Is he aware that diesel fumes are carcinogenic and that, under the regime of the last Mayor of London, London schoolchildren have been walking to school along main roads through carcinogenic air? Will he join me in calling upon the new mayor to do a great deal better?
The Earl of Courtown
My Lords, the noble Baroness mentioned the new Mayor of London. No doubt the House is aware that the mayor is responsible for air quality in London. We welcome the commitment of the new mayor to lead the improvement of air quality in the capital, building on plans already in place, but we also look forward to seeing his plans in more detail when publishing his consultation. The noble Baroness is quite right when she refers to, for example, children walking to school. It is right that we improve the environment so that they are not put under undue pressure from pollutants.
Baroness Finlay of Llandaff (CB)
In 2008 I had the privilege of chairing a Select Committee on allergy. We reported that atmospheric pollution, particularly by diesel particulates, was increasing allergy-related diseases but also hindering the lung growth of small children, particularly babies and primary school children. It seems sad that we have begun to take that seriously only at this point. Will the Government undertake to work with primary schools in particular so that those schools know the level of atmospheric pollution that their children are subjected to on a daily basis, particularly when they are outside, and therefore at least can take some evasive action while the Government work to decrease the diesel particulate contamination of our air?
The Earl of Courtown
My Lords, as the noble Baroness will be aware, local authorities are responsible for reviewing air quality in their area, including around schools, and assessing the levels of air pollutant concentrates against the objectives set in the air quality regulations. I will take careful note of what she said and I am sure that the department will be aware of it, but I should tell the House that air quality is improving. Between 2010 and 2014, emissions of nitrogen oxides fell by 17%.
Lord Forsyth of Drumlean (Con)
Will my noble friend confirm that the EU regulations placed an emphasis on CO2 emissions, as opposed to nitrous oxide emissions, following lobbying by the German car industry in favour of the turbodiesel engines which it had invented, and that this is an example of how Brussels is subject to lobbying which is against the public interest of the wider community?
The Earl of Courtown
My Lords, my noble friend touches on an area also relating to Volkswagen and refit and recall of cars. In the United Kingdom, Volkswagen will be recalling cars and doing a refit at no cost. My noble friend mentioned a number of other points, but I shall have to write to him with further information.
Baroness Jones of Whitchurch (Lab)
My Lords, first, will the Minister join me in congratulating the new Mayor of London, because he has brought forward the previous mayor’s proposals on clean air? Secondly, the noble Lord will know that the World Health Organization has said that more than 40 towns and cities in the UK have air quality pollution which is unsafe for health. Can he explain why his Government are introducing clean air zones in only five cities? Is not this a further indication of their failure to take the public health scandal seriously?
The Earl of Courtown
My Lords, the noble Baroness first asked whether I will congratulate the new Mayor of London and of course I will. She also mentioned the five cities already coming under the clean air zone provisions. That does not mean that other cities cannot apply to have clean air zones themselves, and I am sure that we would be able to advise on such, but the point is that we want to start with those five large cities and see what improvement can happen there.
Humanitarian Emergencies: Women’s Rights Organisations
(8 years, 5 months ago)
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Baroness Hodgson of Abinger
To ask Her Majesty’s Government what steps they are taking to fund women’s rights organisations during humanitarian emergencies.
The Parliamentary Under-Secretary of State, Department for International Development (Baroness Verma) (Con)
My Lords, we recognise the critical role that women’s rights organisations play in achieving lasting transformation in the rights of women and girls. This is precisely why I announced a $1 million fund for the UN-led global acceleration instrument. My noble friend will also be aware that, since 2012, we have increased our humanitarian violence against women and girls programme sixfold, and we are proud to be contributing to the UN trust fund and to Amplify Change. I also pay tribute to my noble friend’s work in these matters.
Baroness Hodgson of Abinger (Con)
I thank my noble friend for her Answer. I also congratulate the Government on their commitment at the World Humanitarian Summit in Istanbul to give support to women and girls during emergencies. Can she tell me whether the Government will be establishing a funding mechanism for women’s rights organisations during humanitarian emergencies, especially conflicts, to ensure that funding gets to those organisations at the grass roots—and, specifically, whether UK funding is getting through to women’s rights organisations in Syria, which are desperately trying to look after families and provide support and services to their local communities?
Baroness Verma
My Lords, my noble friend is absolutely right that we need to ensure that women’s rights organisations on the ground are properly funded and supported. Therefore, I am proud of the work that the UK is doing. We are trying to encourage our partners and other donors to step up, too, but we need to make sure that the funding is going to support those local organisations on the ground in their capacity-build to be able to respond. On that, the department is doing a lot of work.
Baroness Northover (LD)
My Lords, protection of women and girls is clearly absolutely vital, and I would like to welcome Malala and her fellow students, who are here today. Given the Minister’s responsibilities within DfID for relations with the EU, what action has she taken to ensure that in future we can work closely with the EU, which has the biggest development budget in the world, to influence it over this and other vital matters?
Baroness Verma
My Lords, the noble Baroness is of course right that we do a lot of our work through the European Union, but we also do it through a number of other large multilateral agencies and organisations. We will continue to work hard, and I am sure that in her Statement my noble friend the Leader of the House will lay out a clearer picture of what the Government will do.
Lord Collins of Highbury (Lab)
My Lords, I, too, congratulate the Government on their efforts in terms of financing, but the UN Committee on the Elimination of Discrimination against Women urged that the Sendai framework, which emphasised gender issues, should be taken up by all countries. Can the Minister say what the department is doing to ensure that in disaster-prone countries women are involved in the decision-making processes to reduce risk?
Baroness Verma
The noble Lord is absolutely right that women and girls have to be part of the decision-making process. That was very much felt at the Syrian conference, where I met a number of women who told me, in their own testimonials, how powerless they felt and that they wanted meaningful engagement. The work that we have done and the announcements we made last October demonstrated our further commitments to ensuring that, wherever we have peace conferences and summits, we will have representation of those women’s voices at the table. But we have much more to do. I agree with the noble Lord that so much more needs to be done across the board, across all agencies and donor countries, to ensure that those voices are heard and that they make a meaningful contribution. I look forward to Members across this House helping us to ensure that that message continues to be loud and clear.
Baroness Afshar (CB)
My Lords, are the House and the Government aware that, unfortunately, men in many Muslim countries work as barriers between Muslim women and their Koranic rights? It is therefore essential that the right help is given to the women to exercise their God-given rights—but it has to be direct, because their male colleagues would not like to accommodate them.
Baroness Verma
My Lords, we advocate very strongly strengthening the voice, choice and control of women’s and girls’ rights in all settings. The noble Baroness is right that we need to work tougher and harder to make sure that we act as strong advocates for women’s voices in countries where they are not being heard.
Baroness Sheehan (LD)
My Lords, I spent Friday and Saturday at the refugee camp in Calais. Can the Minister say what dialogue she has had with her French counterparts about the conditions of women and children in the camp there, given that some of them have family reunification rights to the UK?
Baroness Verma
My Lords, as the noble Baroness will be aware, we are in ongoing dialogues with all our partners. Whether in Calais or elsewhere, we need to ensure that we very much support the protection and rights of women and girls in those settings, as they will be the most prone to abuse and violence. It is therefore incumbent upon us to ensure that we, along with our partners, work hard to ensure that. However, the noble Baroness will also be aware that these issues were raised at the last conference we held in London and that all partners gave a commitment to ensure that we are able to put into place as many safeguards as we possibly can. But we do need the grand bargain, which is about bringing together the development and humanitarian pieces in a better-aligned way so that we can deal with both issues at the same time.
Lord Foulkes of Cumnock (Lab)
My Lords, if there was an emergency in St Helena, how could we get help to them quickly?
Baroness Verma
My Lords, I think that the noble Lord refers to another Question. I have already asked the noble Lord to take up my offer to come and see what the department is doing and talk to officials—and I extend that offer to all noble Lords who are concerned about St Helena.
Bus Services Bill [HL]
(8 years, 5 months ago)
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Lord Ahmad of Wimbledon
That it be an instruction to the Committee of the Whole House to which the Bus Services Bill [HL] has been committed that they consider the Bill in the following order:
Clauses 1 and 2, Schedule 1, Clauses 3 to 6, Schedule 2, Clauses 7 and 8, Schedule 3, Clauses 9 to 15, Schedule 4, Clauses 16 to 26, Title.
Intellectual Property (Unjustified Threats) Bill [HL]
Baroness Neville-Rolfe
That the Bill be now read a second time.
Considered in Second Reading Committee on 15 June
Investigatory Powers Bill
(8 years, 5 months ago)
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The Minister of State, Ministry of Defence (Earl Howe) (Con)
My Lords, in the digital age, the convergence of the internet with social media, combined with the rise of cheap but sophisticated internet-enabled devices, has given criminals, terrorists and hostile foreign states new means to attack us. Those who engage in organised crime, child sexual exploitation, drug crime and terrorism are resorting to ever-more sophisticated means to avoid detection and prosecution. As we remember today those who died in the horrific attack in Tunisia a year ago, it is worth reflecting on the way that Daesh in particular has exploited the internet and social media to distribute large quantities of often sophisticated online propaganda to radicalise and recruit large numbers of people here and in other countries.
Today’s Bill ensures that law enforcement and the security and intelligence agencies retain their crucial powers to intercept communications and obtain communications data. However, it also radically overhauls the framework in which the exercise of those powers is authorised and overseen. It creates a “double lock”, introducing for the first time judicial authorisation of the most intrusive investigative techniques, it consolidates oversight into the new strengthened office of the Investigatory Powers Commissioner and it sets a new standard for transparency and accountability in the exercise of covert powers by the state.
The Bill is the culmination of two years’ work, and it is worth detailing the lengths to which we have gone to ensure that the Bill is rigorously scrutinised. There have been three independent reviews of investigatory powers, conducted by the Intelligence and Security Committee of Parliament, the independent surveillance review panel convened by the Royal United Services Institute, and the Independent Reviewer of Terrorism Legislation, David Anderson QC. Three committees of Parliament have also examined the Bill: the Commons Science and Technology Committee, the Intelligence and Security Committee, and a Joint Committee of both Houses convened specifically to examine the draft Bill. Their reports all endorsed the principle of the Bill, and the Bill and codes of practice now reflect the vast majority of their recommendations. In total, 14 Commons Public Bill Committee sessions pored over it, with more than 800 amendments considered. Alongside this, we have published draft codes of practice, operational cases, fact sheets, memoranda and detailed responses to the reports on pre-legislative scrutiny. I am very grateful to the noble Lord, Lord Murphy, who chaired the Joint Committee, as well as to the noble Lords who served on the committees. Their work, and the debate in the other place, has strengthened the Bill that reaches us today.
This is a Bill that passed on a cross-party basis with an overwhelming majority. It will provide world-leading legislation setting out in detail the powers available to the police and the security and intelligence services. It will also provide unparalleled openness and transparency about our investigatory powers.
I turn to the detailed provisions of the Bill. The Bill deals with a wide range of issues: privacy; targeted interception; retention of communications data; bulk powers; legislative oversight; and other technical considerations. It is important to emphasise that the Bill brings together existing powers in a clear and comprehensible way, in the process improving transparency, bolstering safeguards and strengthening oversight. It introduces just one new power—the retention of internet connection records—which I will come to presently and which I know the House will want to examine thoroughly.
I will take each area in turn. I begin with privacy. Recognition of the right to privacy is woven into the very fabric of the Bill, so Part 1 deals with the privacy protections that apply to the use of these powers, as well as the offences and penalties for their misuse. That is reflected in Clause 2, dubbed the “privacy clause”, which sets out the important principles that underpin the exercise of the Bill’s functions. On Report in the Commons, the Government supported an opposition amendment to ensure that authorisation of interception under the Bill could not be sought for the purpose of interfering with legitimate trade union activity. We will bring back amendments to ensure that this applies to all powers in the Bill.
Part 2 brings us to the use of targeted interception and is worth considering alongside Part 5, which deals with the use of targeted equipment interference. Interception in some form is used in support of the majority of MI5’s top-priority counterterrorism investigations. Between 2013 and 2014, interception capabilities played a critical role in law enforcement investigations which resulted in more than 2,200 arrests and the seizure of over 750 kilograms of heroin, 2,000 kilograms of cocaine, 140 firearms and £20 million. Equipment interference under the Police Act 1997 and the Intelligence Services Act 1994 is a vital capability for law enforcement and the agencies and, in the face of increasingly capable hostile actors, is becoming more important as a means of supplementing and, in some cases, replacing interception capabilities.
Both those powers are used to obtain the contents of communications, and so are among the most intrusive available to the state. That is why they are subject to the double lock: a Secretary of State may issue a warrant only after the decision to do so has been approved by a judicial commissioner. There was much debate in the other place about the basis on which judges will review decisions to issue warrants. The Government amended the Bill as a result of that debate. It is now clear that the judicial commissioner must give careful consideration to the matters before them and that the protection of privacy must be central to that consideration.
Parts 3 and 4 deal with the retention of, and access to, communications data. The term “communications data” does not refer to the content of a communication; it relates to when, how and where a communication was made, and by whom. The law already requires the retention of certain types of information data by communications service providers. This is vital. Some 58% of requests for communications data in child abuse investigations are for data that are more than six months old. In a Europe-wide investigation into online child sexual exploitation, of 371 suspects identified in the UK, 121 arrests or convictions were possible; of 377 suspects in Germany, which does not retain communications data, no arrests were made.
Part 4 contains the only new power in the Bill: the ability to require a telecommunications operator to retain internet connection records—ICRs. An ICR is a record of which internet service was accessed. It is not, as is sometimes supposed, a full web-browsing history. Law enforcement faces a growing capability gap. The Joint Committee that scrutinised the draft Bill agreed that ICRs are necessary to close that gap. To take an example, of 6,025 cases relating to the sharing of child abuse imagery referred to the CEOP command of the National Crime Agency, 862—that is 14%—would require the retention of ICRs to have any prospect of identifying a suspected paedophile. During consideration of Parts 3 and 4 of the Bill in the other place, the Government committed to introduce a threshold for access to internet connection records to ensure that they cannot be used to investigate trivial offences. This will complement the other rigorous safeguards restricting the circumstances under which ICRs can be accessed by public bodies. I will bring amendments to this House in the coming weeks and months to give effect to this commitment.
Parts 6 and 7 deal with the bulk powers in the Bill and the retention and use of bulk personal datasets. The powers available to the security and intelligence agencies to acquire communications and other data in bulk are vital to their work. The Government published an operational case for bulk powers alongside the Bill. As that sets out, bulk powers are used to gather large volumes of data. These data are subject to very stringent controls to filter the material and select for examination a small fraction of the material that provides intelligence on known threats and to identify new ones. None of the bulk powers in the Bill is new. The collection of large volumes of data is essential to enable the data which are not of interest to be filtered out and search criteria applied so that fragments of intelligence can be gathered and pieced together in the course of an investigation. These data may not be available by other means. The threat from terrorism and the development of technology is such that the bulk powers will inevitably become more important than ever in the future.
It is right that the safeguards and protections associated with these powers are now a matter for Parliament. However, there is more that can be done to provide the public and Parliament with reassurance that the case that stands behind these powers is clear. That is why the Government commissioned David Anderson QC, the Independent Reviewer of Terrorism Legislation, to examine the operational case for the bulk powers in the Bill. That review will conclude in time to inform this House’s consideration of the relevant clauses in Committee.
Part 8 of the Bill deals with the oversight of these powers. At its heart is the creation of a powerful new Investigatory Powers Commissioner. During the Report stage, the Government committed to strengthen the process for appointing that commissioner, so that appointments will be on the joint recommendation of the Lord Chief Justice, his or her devolved equivalents and the Lord Chancellor. We will bring back an amendment to this end. We will also ensure that the Intelligence and Security Committee can refer matters to the Investigatory Powers Commissioner for investigation on behalf of Parliament.
Part 9 of the Bill deals with other general provisions, including technical capability notices and national security notices. We have amended the Bill to ensure that these notices are now also subject to the double lock. Part 9 also provides for the Secretary of State to review the operation of the Bill after five years and to report to Parliament with his or her findings. It is my hope and expectation that the Secretary of State will be assisted in that work by a Joint Committee of Parliament and the Intelligence and Security Committee.
These are all important powers, but this Bill provides for them to be exercised only when it is necessary and proportionate to do so. It does not give free rein to public bodies to intrude upon the privacy of citizens without proper justification and authorisation. In fact, it strengthens the checks and balances applied, adds safeguards, bolsters oversight and sets out the privacy considerations which must be applied to any application to use the powers. I welcome the constructive and thoughtful debate that has characterised the passage of this Bill to date. It reflects the importance of this legislation and the need for us to get it right. I very much hope that the progress of the Bill through this House will continue in the same vein. There is a long list of Peers who wish to speak, all of whom are experienced in these matters and from whose knowledge and expertise we will undoubtedly benefit. I look forward to hearing them.
But before I conclude, it is important to say this: in the two years that have passed since this House considered the Data Retention and Investigatory Powers Act, the world has become a more dangerous place. There have been attacks in Orlando, in Paris, in Brussels, in Tunisia, in Jakarta, in Turkey and elsewhere in the world. The NSPCC reports that eight offences a day are committed against children via the internet. This month, we saw the prosecution of organised criminals seeking to smuggle into the UK more than 30 machine guns and more than 1,500 rounds of ammunition. All these events remind us of the ongoing risks faced by law enforcement and the intelligence agencies every day. The challenge of this Bill is to balance the need to give the police, the Armed Forces and the security and intelligence agencies the powers they need to keep us safe in a changing and uncertain world while ensuring that those powers are subject to strong safeguards and robust oversight. I believe this Bill strikes that balance. For that reason, I commend it to the House. I beg to move.
Lord Rosser (Lab)
My Lords, the Investigatory Powers Bill seeks to address an issue that, in theory, is simple and straightforward: namely, the appropriate balance between individual privacy and collective security in the digital age. However, what make it in reality a far from simple and straightforward issue are the very different views on where that appropriate balance lies.
The vote in the referendum last Thursday to leave the European Union has, potentially at least, added to the complexity, since it has raised the question of what the implications of that decision might be for the proposals in the Bill and their effectiveness and relevance, bearing in mind the considerable co-operation with what are still, at this moment in time, our European partners over security and intelligence issues and the European arrest warrant in the fight against terrorism and serious crime. What happens if the present level of co-operation is scaled down? If it were scaled down, would it happen only from the day we left the European Union or would it start to happen earlier?
The resignation of our European commissioner does not suggest that our involvement with and influence in the European Union and European organisations will continue at the present level until the necessary negotiations on our withdrawal have been completed. I ask the Minister to make some meaningful comment on this point when he responds at the end of the debate. This question was not discussed during the passage of this Bill through the House of Commons, but it should be considered, and answers sought, in this House.
As the Minister said, the Bill was the subject of extensive pre-legislative scrutiny, including by a Joint Committee of both Houses chaired by my noble friend Lord Murphy of Torfaen. Prior to the pre-legislative scrutiny, there had been extensive scrutiny of our investigatory powers in three independent reviews, including one by David Anderson QC, the Independent Reviewer of Terrorism Legislation. His review and the other reviews stressed that legislation relating to interception and communications data needed to be consolidated and made subject to clear and robust privacy safeguards. This Bill is also intended to replace the Data Retention and Investigatory Powers Act 2014, which contains a sunset clause requiring new legislation to be passed by the end of this year.
Safety and security matter—a point brought home to us all too painfully just over a week ago when one of our much respected and much admired parliamentary colleagues, Jo Cox MP, was brutally murdered in the street in broad daylight in this country.
The current threat level for terrorism is severe. We have also seen major attacks recently in Paris, Brussels and elsewhere. The Bill, though, covers not only terrorism but other serious crimes such as people trafficking, including the trafficking of children, sexual abuse, stalking and harassment. The security and intelligence services, GCHQ, the National Crime Agency and the police must have the powers to deal with these threats in an age when those involved in terrorism and criminality are operating online with a reach and on a scale that has not existed before through exploiting the technological advances now available for their own ends.
Human rights matter, too, including the right to privacy, the right to be left alone, the right to have private data protected and the right to redress when needed. My noble friend Lady Lawrence of Clarendon, who is in her place, and her family were put under surveillance by the Metropolitan Police with no justification at all. Those whose job it is to protect us, and to whom I do not think we always give sufficient credit and thanks for what they do on our behalf, cannot be expected to carry out their responsibilities with one arm tied behind their back. Equally there have to be effective checks and there has to be public confidence among all sections of our diverse community that the arms of those who protect us are not extending into areas where there is neither the need nor the justification.
Safety and security and human rights are not mutually exclusive. The Bill has completed its passage through the Commons. The Labour Party voted for it at Third Reading in the light of both significant amendments made in the Commons to meet our Labour red lines and in the light of undertakings given by Government Ministers to address further issues of Labour concern during the Bill’s passage through this House. It is now up to the Government to deliver on those verbal undertakings, now on the record in Commons Hansard. They include a commitment to introduce a threshold for access to internet connection records so that the powers cannot be used in investigating minor crimes—which is what the Bill as presently drafted in effect permits.
On Report in the Commons, the Government Minister, in response to our argument for a general serious crime test for communications data and a higher threshold on top of that for the use of internet connection records—but one which would provide that offences such as grooming, harassment and stalking were still covered—said he was committed to doing what we were seeking, and continued:
“I do so because it is really important that we have a threshold that works, particularly on ICRs”.—[Official Report, Commons, 7/6/16; col. 1120.]
A further commitment was made in respect of the protection of journalistic sources. We have already secured amendments to the Bill providing that judicial commissioners, when considering a warrant, must give weight to the overriding public interest in a warrant being granted for the use of investigatory powers against journalists, and that they must ensure that it is in keeping with wider and more general privacy points.
However, there are still matters outstanding on this point, including the extent to which the Bill does or does not provide for the same level of protection for journalists as is currently the case under the Police and Criminal Evidence Act. There is also the question of the definition of who is and who is not a journalist now that we are in the digital world. The Government Minister in the Commons accepted that a solution needed to be found and said:
“I am happy to say that we will look at this issue with him”—
the shadow Home Secretary—
“and others in greater detail as the Bill enjoys its passage through this House and the other place”,—[Official Report, Commons, 7/6/16; col. 1117.]
with the reference to “others” including the National Union of Journalists.
There is also an outstanding issue over legal privilege. The Bill now provides that it is only in exceptional and compelling circumstances that warrants may be issued where one of the purposes is the obtaining of legally privileged communications. Questions about the provisions in the Bill have been raised by the Law Society and the Bar Council, and I understand that the Government are continuing to discuss the concerns raised with the relevant organisations. We will need to know the outcome of the discussions and whether these concerns have been resolved. This is not about preserving the special status of individuals who work in journalism or the legal profession, or indeed as parliamentarians, but about protecting the public and their ability to raise issues through these channels on a secure and confidential basis.
In the Commons, the Government also accepted in principle our amendments relating to appointments to the new Investigatory Powers Commissioner, which would increase the role of the Lord Chief Justice in making recommendations for appointment to the Prime Minister. We will also need to be satisfied that the safeguards around modifications to warrants have been strengthened sufficiently to ensure that major modifications cannot be made by the back door, thus avoiding the provisions laid down in the Bill for obtaining warrants. We are not yet satisfied that this issue has been fully resolved, although we recognise that it is not a straightforward matter and we would be willing to work with the Government on it.
A number of crucial changes to the Bill were secured in the Commons through the approach we, as the Official Opposition, adopted. First, on the powers in the Bill which enable information to be retained in bulk form, the Government accepted our argument that there should be an independent review of the operational case for such powers. These are actually powers which, for the most part, are currently available and being exercised at present, but not on a statutory footing with safeguards. The investigation will be carried out by David Anderson QC, the Independent Reviewer of Terrorism Legislation, and will consider the necessity of the powers and whether the same result could have been achieved through alternative means. He will conclude his work before the relevant clauses in the Bill are reached in this House. This was a fundamental concession as far as we were concerned. While it clearly depends on what conclusions David Anderson reaches, it is quite likely that the findings of his review will prove to be the major issue.
Secondly, we pressed for and achieved an overarching privacy clause in the Bill against which the use of the exceptional powers in the Bill will have to be justified. We believe that it is vital to have this in the Bill so that privacy considerations are at its heart. Thirdly, we secured a provision that makes it clear that legitimate trade union activities are not a sufficient reason for powers under the Bill to be exercised. Fourthly, on judicial oversight of decisions to approve warrants for the exercise of powers under the Bill by the Home Secretary, a judicial commissioner will have to consider necessity and proportionality, and balance that against the overarching privacy clause. The judicial commissioner will not just be scrutinising the process. Fifthly, progress was made on providing protection for whistleblowers when giving information to the Investigatory Powers Commissioner.
The Joint Committee on the draft Bill called for protection for members of the intelligence services who raise concerns about the misuse of investigatory powers with the Investigatory Powers Commissioner. The Bill provides for an individual to be able to give information on a voluntary basis to the commissioner without that individual committing a criminal offence or incurring a civil liability. However, the Solicitor General in the Commons agreed on Report to make it absolutely clear in the Bill that whistleblowers can make disclosures to the IPC without fear of prosecution. The Bill also now provides greater protection over access to medical records, which can be retained and accessed only in “exceptional and compelling circumstances”.
I have not referred to all the changes to the Bill secured in the Commons, or to all the undertakings given by the Government in respect of amendments to the Bill tabled in this House. What has been achieved, though, is an indication that, thanks to the persistence, determination and constructive work of the Official Opposition and others, and the willingness of the Government to listen, there are now much stronger safeguards in the Bill protecting people’s privacy and their human rights than existed in the original Bill or exist under current legislation.
That does not mean that the Bill is perfect—I am sure we will all want to listen to areas of continuing concern that may well be expressed both inside and outside this Chamber as we consider the Bill in detail. Clearly, our position on the Bill has changed since it started its passage through the Commons. We are looking, though, to make further progress during debates on the Bill in this House and, in particular, to hold the Government to the outstanding commitments and undertaking they gave in the Commons and on which the House will expect to be updated as we go through the Bill.
Lord Paddick (LD)
My Lords, this is a very complex Bill dealing with very technical matters in places, but we should not be intimidated by that. Nor should we simply say that we must give the police and the security services all the powers they ask for without scrutiny.
It is the responsibility of the police and the security services to ask government for the powers they believe they need in order to be effective. It is our responsibility—the responsibility of Parliament—to balance those requests against the tests of necessity and proportionality. There will always be a tendency for politicians to accede to the demands of the agencies of the state; should crime rise or terrorist acts be perpetrated, politicians could not be blamed if they had given the police and the security services everything they said they needed. Yet this has not always been the case. When the then Labour Government pressed the case put forward by the police for 90 days’ detention of terrorist suspects without charge, Parliament refused. The security services did not ask for such a power. Arguably, it was reasonable to turn down a power that would assist in the prosecution of offenders, provided that it did not affect the security services’ ability to prevent terrorist activity. Yet in this Bill, we face a similar demand from law enforcement for a draconian power that the security services say they do not need.
The Liberal Democrats recognise the vital role the police and the security services play in keeping us safe. We also recognise the need for trust between state agencies and the public, not least to ensure the flow of community intelligence—even more vital as the terrorist threat changes in nature and criminals become more sophisticated. In order to be effective, the police and the security services need to have powers to carry out surveillance, including the interception of communications, the retention and acquisition of communications data and equipment interference. This will involve intrusion into people’s privacy, but unless there is no other practical means of achieving the objective, intrusion into innocent people’s privacy should not be allowed, other than in exceptional circumstances, and even then it should be subject to the highest levels of oversight. Innocent people’s privacy should not otherwise be put at risk, let alone intruded into. Internet connection records—the only virgin territory in the Bill—are going to intrude into innocent people’s privacy.
I do not believe that anyone in this House believes that we do not have a right to privacy, but perhaps I should declare a personal interest in this area, in the example I am about to give. What about 25 years ago, when I was married to my wife, Mary, but I believed I was gay? Should I have been able to keep that situation private? What if someone today was in that position and wanted to research using the internet to get some help and guidance, for fear of talking to anyone and letting the cat out of the bag, like me in those days? This Bill requires internet service providers to record every website that everyone in the UK visits, to store that data for 12 months and to reveal those details to the police without a warrant if they suspect someone of crime. If someone alleged that I roller-skated into a shop, indecently assaulted someone and roller-skated out again—apparently, one of the allegations made against Sir Cliff Richard—details of every website I had visited in the past 12 months could be handed over to the police without a warrant if we allow this Bill to pass as it stands.
It is not too much of a stretch to think that someone might make an allegation against me, as a reasonably high-profile individual, so it would be not too far a stretch to think that I had better not seek confidential advice on the internet, in case it became public. How could it become public? Homophobia has been encountered in the police service, as has unauthorised disclosure of confidential information. “If you have nothing to hide, you have nothing to fear” is not the same as “If you have done nothing wrong, you have nothing to worry about”. Even if the police were to be trusted completely, massive pools—oceans—of data in the custody of private companies such as TalkTalk, one of the internet service providers that will be asked to store such data, would be sitting ducks for hackers, criminals, blackmailers and hostile foreign powers. For example, information that I frequently visited the Age UK and NatWest websites might make me a target for fraudsters trying to trick me into revealing my account details online by claiming to be from the bank, or they might even turn up at my front door, believing me to be frail and easily conned or overpowered.
The RUSI panel set up by Nick Clegg when he was Deputy Prime Minister set out 10 tests for the intrusion of privacy. It is those 10 tests on which our opposition to parts of the Bill is based. Not only should the Bill be measured against the 10 tests, but Liberal Democrat opposition to the Bill should also be measured against them. One of the tests is that there must be transparency: how the law applies to the citizen must be evident. How many people in the UK know that 12 months of their web history—albeit the website that they are looking at rather than any further pages on that website—will be kept in case the police want to see it, as a result of this Bill’s provisions?
The intrusion must be necessary in that there are no other practical means of achieving the objective. The security services MI5, MI6 and GCHQ say that they do not need internet connection records because they can get the information they need by other means.
The intrusion must be proportionate to the advantages gained, not just in cost and resources but also through a judgment that the degree of intrusion is matched by the seriousness of the harm prevented. Internet service providers reckon that this will cost more than £1 billion in set-up costs alone. The measure may not provide the police with the website someone has visited because it is so easy to conceal it. It will not give the police any information about whether, or with whom, someone was communicating without making further inquiry of other companies such as Facebook, because almost all online communication is encrypted. If a serious crime is involved—the Minister listed a range of serious crimes that the Bill is intended to cover, including child sexual exploitation and terrorism—the security services, which do not need internet connection records, are duty bound to assist the police with their inquiries. We therefore need some convincing that internet connection records are both necessary and proportionate.
There are other issues. We believe that the double lock should be only a single lock in the case of law enforcement warrants which need go nowhere near a Secretary of State if there is no political sensitivity, and that there should be a real double lock where there is political sensitivity, not just the application of judicial review principles to the decision of the Secretary of State. How can there be a judicial review process where only one side of the case is presented to the judicial commissioner? Equipment interference is potentially more intrusive than interception and yet law enforcement equipment interference warrants go nowhere near a Secretary of State under the Bill as drafted, whereas security services equipment interference warrants require a Secretary of State’s signature.
The oversight arrangements have a few wrinkles as well. How are we supposed to have faith in the independence of judicial commissioners appointed by the Prime Minister—not necessarily the current Prime Minister—including the Investigatory Powers Commissioner being appointed by the Prime Minister? How can the same body authorise warrants and then audit their issue?
Not only do we support many aspects of this Bill, but the Liberal Democrats when in government called for such a Bill. However, aspects of the Bill cause us grave concern and the Government and law enforcement agencies have failed to convince us of their necessity and proportionality. The “request filter”, for example, conjures up the spectre of a virtual national database, where government can bring together every piece of available personal data held on an individual into one place. In addition, technical capability notices and national security notices have the potential to inflict serious competitive disadvantage on UK suppliers.
Bulk collection of innocent people’s communications is highly controversial and requires the closest scrutiny. But there will not be a call for a blanket ban on bulk collection from this Bench no matter the cost in lives and loss of security; we will take a reasoned and practical approach to these issues. Nor will noble Lords hear the term “snoopers’ charter” from this Bench, other than to condemn it as an inaccurate cliché. There is much to commend the Bill, but there are serious issues that must be addressed.
Lord Pannick (CB)
My Lords, I welcome the Bill. The authorities need up-to-date powers to obtain information to address the real dangers that we all face from terrorism and serious crime. The existing law has simply not kept pace with technological developments. The Government, with the support of the Labour Opposition, have included provisions to protect personal privacy against unnecessary intrusion and to ensure judicial control of access to personal information. The adequacy of these safeguards will need to be carefully considered by your Lordships.
One matter that will require particularly careful consideration in Committee and on Report is the protection of legal professional privilege—LPP—which is the right of clients to maintain the confidentiality of what they tell their lawyers in private. This subject was mentioned by the noble Lord, Lord Rosser, and I will concentrate on it in today’s debate. In 2002, the noble and learned Lord, Lord Hoffman, explained for your Lordships’ Appellate Committee that LPP is,
“a fundamental human right long established in the common law”.
The reason for that is that, unless a client knows that the solicitor and counsel will not disclose what they have been told in confidence, the client will simply not be prepared to speak honestly and openly when seeking legal advice. LPP is, therefore, fundamental to the rule of law.
It is important to emphasise that these rights belong to and benefit the client; they are not privileges for lawyers. There is a so-called iniquity exception to LPP. As Peter Carter QC for the Bar Council told the Joint Committee of both Houses on the Bill, LPP does not apply if, for example, the client seeks advice from a lawyer,
“on where the best place is to stash his stolen loot”.
Clauses 27, 106, 143 and 179 provide some piecemeal protection for LPP in some contexts. Schedule 7 requires the Secretary of State to issue a code of practice which addresses LPP. These matters were discussed in the other place and, on Report on 6 June, the Solicitor-General, Robert Buckland, said that the Government would be working with the Bar Council and the Law Society to consider introducing, in your Lordships’ House, amendments which would,
“recognise the overwhelming public importance of the preservation of legal professional privilege”.—[Official Report, Commons, 6/6/16; col. 950.]
I suggest that the way forward is as follows. First, as recommended by the Joint Committee, in paragraph 537 of its report,
“provision for the protection of Legal Professional Privilege (LPP) in relation to all categories of acquisition and interference addressed in the Bill should be included on the face of the Bill and not solely in a code of practice”.
The Joint Committee rightly accepted the evidence from Colin Passmore of Simmons & Simmons for the Law Society on this point.
Secondly, the Bill must require prior judicial authorisation for the targeting of discussions with a lawyer or if the authorities have reason to believe that they will be intruding on legal advice. Of course, if there is extreme urgency, judicial authorisation needs to be obtained as soon as possible after the event.
Thirdly, the test that the authorities need to meet to satisfy a judge to give authorisation where there is an intrusion in relation to LPP must be a high one. The test should be exceptional and compelling circumstances: that is the criterion set out in Clauses 27 and 106 and it was discussed by the Joint Committee, and those circumstances should indicate a probable cause for believing that the iniquity exception applies. I say probable cause because the authorities cannot know whether the iniquity exception applies unless and until they listen in and examine the results.
My fourth principle for the way forward is that after the authorities have obtained privileged information by listening in or otherwise intruding on legal discussions, they should be prohibited from retaining the fruits of it unless they obtain judicial authorisation that it is within the scope of the iniquity exception.
Much more difficult is that my understanding is that the Government also want to allow the authorities to listen in to legal advice and to use privileged information where there is no reason to think that the iniquity exception applies—that is, that these are perfectly proper legal discussions, with the lawyer giving advice to the client, but there is reason to believe that the surveillance may provide or has provided information of vital importance to preventing serious crime or tracking dangerous people. This is much more problematic. The difficulty is that to allow the authorities access to genuinely privileged information would inevitably mean that clients could no longer be guaranteed confidentiality by their lawyers. This would inevitably deter clients from speaking frankly to their lawyers and therefore undermine the rule of law. Given the fundamental importance of LPP, the Government will need to present a very strong case indeed in Committee and on Report if they seek to persuade noble Lords that such powers are necessary.
Lord King of Bridgwater (Con)
My Lords, I listened with great interest to the noble Lord, Lord Pannick, on LPP and I was absolutely fascinated by that comment about lawyers being told by their clients where the loot was hidden. What a much more exciting job being a lawyer must be than I had appreciated.
I join other noble Lords in welcoming the Bill. I heard the comments about the Bill having been rushed but if ever there was a Bill that had never been rushed, we have it here today. My noble friend the Minister made the point extremely well in his absolutely excellent introductory speech to this Second Reading. Has any other Bill ever had the scrutiny of three Joint Committees and three independent reviews? Given some of its important provisions, there are those of us in this House who wish to see the Bill moving much faster than the timetable we are presently enjoying. We obviously know that we have to have it finished by the end of the year.
My worry about the Bill and the question I will raise, following previous legislation, concerns the challenge to keep up with new technology. I stand here as an avowed ignoramus on many of these amazing technologies, such as WhatsApp, Snapchat, Twitter and Facebook. I see that the latest route that has been used by terrorists is the chat network on PlayStation. That will give Sony a few thoughts about how it organises its business in future and about the requirements that the Bill may impose on it. Without any question, the challenge is that while it might seem to be an amusing paradise for geeks, we know that there is a very dark side to this and that it offers a huge range of opportunities for some very sinister elements, be they terrorists, organised criminals, paedophiles or child abusers. All forms of evil can thrive and operate within this. We have known for some time the use that ISIS—the so-called Islamic State—has made of WhatsApp and the incredibly efficient communication that it has given it. When one hears surprise news that ISIS has attacked some town which people previously thought was safe, one knows that that has been achieved because it has very good communications through the new systems of technology which we are trying to keep up with.
It is against that background that we realise the incredible challenge that the police and intelligence agencies have. The Minister referred to the scale of the threat, which takes so many different forms. I have often talked in this House about how terrorism has changed since the time I was in Northern Ireland. We did not have suicide bombers in Northern Ireland. The challenge they pose to new systems of security is very real. While we have suicide bombers, we also have the willingness to engage in appalling massacres of innocent civilians. We know that some of the very evil people who exist in the world at present no longer have any interest in war crimes, Geneva conventions or anything else.
My noble friend referred to the anniversary yesterday of perfectly innocent people being mown down on a beach in Tunisia. We know that we have every finger crossed in this country against the risk that we could face at any time. In those situations, static guards, sentries and armed police have a role to play, but the core of so much of this is intelligence. If we are to be successful against this, we need access to intelligence. I was very interested to see that in 95% of prosecutions of organised crime, communications data have been vital; and that bulk powers have been significant in every counterterrorism investigation in the seven plots that there have been in the past 10 years, and vital to detecting 95% of the cyberattacks that we have faced in this country. I was not previously aware that 90% of our military operations have been conducted successfully without casualties by access to information under the systems that we are discussing today.
I warmly welcome the last comment of the noble Lord, Lord Paddick. I was about to attack him for the phrase “snoopers’ charter”, but he managed to get out in time. Part of the problem with the Bill is that people often do not understand the importance of what is happening, because the intelligence agencies in particular and the police are very inhibited in what they can say about why some of this information is so vital to the defence and security of our country, as too often that runs the risk of revealing methods or techniques that it is vital to protect in the interests of the security of our country. It is still cited as a “snoopers’ charter” by some, but that is a cheap, silly and dangerous remark. It is insulting to the police and our intelligence agencies to use such a phrase. As borne out by the comments Dominic Grieve, the current chairman of the ISC, made in another place on this Bill, we know the high sense of responsibility that is generally shown by our intelligence agencies and the police. Of course there can be mistakes, and there are occasions when people do not live up to those high standards, but to suggest that in general the organisations do not seek to observe scrupulously the proper use of these powers is grossly irresponsible.
We will certainly seek proper scrutiny of the legislation as it goes through. The noble Lord leading for the Opposition referred to the substantial changes made in the Commons and the number of important undertakings that have been made which will have to be put into effect here. I welcome that. It is a question of proportionality and of achieving that proper balance between protecting public security and legitimate privacy. It has been claimed that the Bill is a world first in the scale and range of what it seeks to achieve. I could not help being amused today by the comments of Mr Edward Snowden, who finds that the Russians are operating some pretty intrusive activities, and without all the provisions that exist in this legislation, as far as I am aware. I welcome the dual lock that is being introduced, which is important.
I end simply with one comment. As we go through the Bill, I shall look at whether it has the flexibility to cope with the accelerating pace of technical change. We have to make sure that it remains effective as the years go forward. We know that the speed with which new technologies, systems and techniques are coming in poses a major challenge to our agencies. It is our duty as legislators to provide for the introduction of properly scrutinised and properly protective regulations, under which the agencies can protect our country and at the same time properly respect the privacy of its citizens.
Lord Blunkett (Lab)
My Lords, I rise to support the Bill. I was going to wholeheartedly commend the present Home Secretary for being prepared to listen and respond, but I fear it might do her chances of becoming leader of the Conservative Party enormous harm. She has the great merit of having taken responsibility in her life, and acted responsibly and shown a gravitas which others certainly do not.
I reinforce the point made by my noble friend from the Front Bench. We are, at this moment, in a more insecure and uncertain landscape than we have been for some considerable time. It is at moments just like this when your Lordships’ House provides the stability needed, and the accumulated experience and wisdom, to ensure that we get things right. I have not always thought so. Back in 2001, when I was piloting the then Anti-terrorism, Crime and Security Bill through the two Houses of Parliament on the back of the terrible attack on 11 September 2001, I often went home extremely aggrieved at amendments that your Lordships’ House had passed. However, I came in due course to respect the work that was done in this House, the wisdom that was brought to bear—not least by those with substantial judicial experience—and the ability to find solutions to agreed problems that were better than the ones we had set out in the first place in the Bill. So I come here to speak with some humility this afternoon.
While, as has been explained, much has already been done to improve the original draft of the Bill, I hope that we can speed its passage and ensure that the final touches are put to what is a very important piece of legislation. It obviously combines what was agreed in the past, which, not least in the Telecommunications Act 1984, reinforced what was not necessarily understood publicly. It ensures that there is a right of review, proper openness and scrutiny.
I can be brief because I have had the privilege of giving both written and oral evidence to the Intelligence and Security Committee and to the Joint Committee chaired by my noble friend Lord Murphy. I agree with what has already been said: much has been achieved by having a draft Bill and being prepared to listen to people. I shall make just two or three comments.
I reinforce what the noble Lord, Lord King, said: we are living in an era of enormous technical change. What is happening now through the world wide web and through cyber is completely different from anything that we experienced even 25 years ago, and we need to take account of that. The noble Lord, Lord Paddick, spoke movingly of what might have intruded on him had we been dealing with a circumstance such as the one that he outlined in his private life. It is important that we recognise those personal details but we should also take a 60-year step back and understand how far we have come in terms of privacy and individual rights. Do noble Lords remember the trunk calls that had to be routed through the local exchange? When I was a child, we had party lines with our neighbours, and there was a standing joke that they all knew precisely what we were doing and when we were doing it.
It is also true that we have come a long way in understanding the importance of having the right oversight. I was privileged to ask the noble Lord, Lord Carlile, to take on that initial role many years ago. Eyebrows were raised on my side of the House that I had asked a Liberal Democrat to oversee what I was up to in the Home Office. At the time, it was felt that I was quite a draconian Home Secretary, but we were dealing with extraordinarily difficult times. At such times challenging and difficult measures have to be taken but there always has to be the proportionality that has been spoken about—the balance between security and prevention on the one hand and individual liberty and privacy on the other. I know a thing or two about privacy and intrusion into people’s private lives and those of the people around them, not from the state—although who knows?—but from private interests intent on commercial gain. Therefore, I am wholeheartedly in favour of protecting the privacy of the innocent and ensuring that people’s private lives are respected, but the most important responsibility of any Government is protecting their people and ensuring that those who would use democracy to abuse liberty and privacy are counterweighted and acted against.
During the passage of the Bill in the weeks ahead I hope that we can deal with those outstanding items, but I also hope that we can do so with an understanding that our main responsibility to the British people when the threat level is severe is ensuring, in this moment of instability, that we provide the necessary powers to the intelligence and security community and the counterterrorism police, although we expect them to respond in kind. We also need to ensure that we build confidence among the British people that we know what we are doing and are doing it on their behalf.
Lord Strasburger (LD)
My Lords, I, too, welcome the Bill and congratulate the Home Secretary on the good intentions behind it. I have been calling for reform in this area for four years. To start with, I was ridiculed by some Members of this House and patronised by Ministers. But then, in July 2014, the Government finally admitted that RIPA and the other elderly Acts that make up the patchwork of legislation governing this area needed to be replaced by a single new Bill, which is what we have here. But, even with the useful amendments passed by the Commons, as it stands the Bill is very far from fit for purpose, and we in this House have much work to do to knock it into shape.
Two new clauses were added in the other place in response to the ISC’s call for a backbone of privacy to be included in the Bill. But the new clauses do not cut the mustard for the chair of the ISC, who has called for them to be clearer about the right of citizens to privacy. There needs to be much better protection in the Bill, as we have already heard, for privileged communications such as those between lawyers and their clients, journalists and their sources and MPs and their constituents. On warrant authorisation, I have sat through endless evidence and debates on the Joint Scrutiny Committee and I have yet to hear a single convincing reason as to why a Minister needs to be involved in day-to-day police warrantry, as the Bill currently provides.
The next topic is the bulk surveillance powers that indiscriminately collect everyone’s private data. They are currently under review by David Anderson QC. When a similar review was undertaken in the USA, the bulk powers were found to have made no serious contribution to detecting and preventing crime, and were discontinued. We must ask ourselves why the UK should travel in the opposite direction.
The only new power in the Bill, as has already been said, concerns internet connection records, which are highly intrusive, difficult and expensive to implement and of no interest whatever to the security services. They were abandoned in 2014 in Denmark, the only country that has tried to do this before, because they failed to deliver the expected benefits. It is my view that ICRs need to be deleted from the Bill. The request filter appears to be a classic wolf in sheep’s clothing, and it will need careful examination before it can be allowed to remain in the Bill.
Finally, the threat to encryption needs to be removed from the Bill. Strong encryption, as the Government have recognised in this House, is vital to our personal security and the integrity of our finance and commerce sectors. The Government are fond of calling the Bill “world-leading”. That is true in some respects, but not necessarily in ways that we would want to celebrate. If it were enacted unchanged, innocent UK citizens would not be far behind their North Korean and Chinese counterparts in a contest to be the most spied-on population in the world. The powers in the Bill are very broad and very intrusive—more so than any of our democratic allies’ powers
One of the praiseworthy aspects of the Bill is that for the first time it offers Parliament the opportunity to consider five major surveillance powers that have been in use, without Parliament’s knowledge or consent, for many years. It is good that these powers have at last crawled out of their dark cave in the Home Office and into the sunlight of scrutiny, but should we not be asking ourselves how the Home Office could be so contemptuous of Parliament as to believe that it was entitled to create new and highly intrusive surveillance powers without bothering itself with the tiresome niceties of parliamentary democracy? It would be good if the Minister could explain to the House how it came to be that obscure clauses in 30 year-old Acts were used to manufacture these powers and wilfully conceal them from Parliament. Perhaps he could also confirm that there are no other hidden surveillance powers of which Parliament is still unaware.
The lesson we must learn from this disgraceful behaviour over many years is that the Home Office cannot be trusted to comply with the will of Parliament. That means that we must take great care to not leave any further what I call “buffet clauses” or “help-yourself provisions” in the Bill for clever Home Office lawyers to exploit for their own purposes. Your Lordships should know that there are plenty of such loopholes still lurking in the Bill, and we will need to dig them out and deal with them.
It is important to understand the context of the Bill in relation to the various threats to life that we face as a nation. I wonder how many noble Lords know how many people died in the UK in the past decade as a result of terrorism. The answer is that it is far fewer than the 110,000 who died because they were admitted to hospital at the weekend, if you believe the Health Secretary; far fewer than the 95,000 who died in London alone due to air pollution; fewer than the 5,500 who were murdered; fewer than the 1,000 women who were killed by their partners; and even fewer than the 300 people who died accidentally in their bath in the past decade. The number of people who died in the UK in the past decade due to terrorism was in fact three—or perhaps four if you include the murder of Jo Cox MP, which we do not yet know was a terrorist incident.
Of course, we must not forget that each and every one of those deaths was a total tragedy and a continuing nightmare for the friends and families of those victims, but many of us are old enough to remember what it was like in the 1970s, when terrorists took 49 lives in mainland UK, or the 1980s, when it was 307, or even the first decade of this century, when it was 56. My point is that, contrary to what some people assert, the risk of death from terrorism is not as high as it was 30 or 40 years ago and the risk of dying from more mundane causes, even an accident in your bath, is currently—
Lord Rooker (Lab)
Perhaps I may ask the noble Lord, therefore, what his estimate is of the number of people who have not been killed due to terrorist activities because of the action of the security services.
Lord Strasburger
I have no idea, is the answer to that question.
My point is that, contrary to what some people assert, the risk of death from terrorism is not as high as it was 30 or 40 years ago, so we must take care not to surrender the freedoms that our parents and grandparents fought to protect in the Second World War on the basis of alleged unprecedented threats.
Lord Reid of Cardowan (Lab)
Since the noble Lord has no idea, I will give just one example, occurring and culminating on 6 August 2006: the attempt to bring down seven airliners—which, were it not for the powers in the Bill, would have resulted in 2,300 deaths on one day alone.
Lord Strasburger
Thank you.
Sometimes, possibly well-meant attempts to improve our safety by treating every citizen as a suspect and collecting everyone’s private data could have the unintended consequence of making us less safe. I am thinking of bulk surveillance powers, which some experts say risk hiding data about the bad guys under a tsunami of personal and private data about the 99% of us who will never be terrorists or paedophiles. Furthermore, by storing 12 months of our internet activity at our service providers to derive a debatable security benefit, we would be exposing all internet users to the entirely new and self-inflicted risk of the theft of that very revealing data by thieves, blackmailers and foreign spooks. There is plenty of experience of cyberthefts to tell us that our personal data will be stolen, whatever bland assurances we get from the Government that they will not.
So the Bill has the potential to be a good one, but it is not yet there and we have much work to do to get it there. I look forward to working with my colleagues on these Benches to achieve that—and, importantly, I hope also to work with noble Lords on the Labour, Cross-Bench and Government Benches to make the Bill fit for purpose and the best it can be.
Lord Ashton of Hyde (Con)
My Lords, I know that the speaking time is advisory and that the noble Lord has been interrupted, but we have a lot of speakers and a Statement, so if he is willing, it would be good if he could bring his remarks to a conclusion.
Lord Strasburger
I will do exactly that.
The events of the last few days have demonstrated how volatile our politics have become and how quickly ruthless politicians can replace more moderate leaders. That means that we must be even more careful about what powers we give the Government to spy on us. Make no mistake—this is not an exaggeration—as it is currently drafted, and in the hands of an extreme Government, the Investigatory Powers Bill would be a toolkit for tyranny. The powers in it and the data that would be collected on all of us would be a grave threat to our freedom and our democracy if exploited by those who would oppress us.
Lord Blair of Boughton (CB)
My Lords, it is certainly an interesting piece of scheduling for me to follow immediately after the noble Lord, Lord Strasburger. I have much respect for him but I have to say—I do not think I am alone—that I do not agree with almost anything he has just said.
I have been involved in conversations about the kinds of powers with which the Bill is concerned since the turn of the century and even before. I lived with the current legislation—principally the Regulation of Investigatory Powers Act, RIPA—and I have watched its relevance to modern conditions slowly shrivel. This is not surprising, because the world has changed and is changing with ever more speed. The digital age is a singularity: a change on the scale of the invention of printing and the Industrial Revolution.
The powers in the Bill are needed. As I have said before in the House, one of the first instructions from the senior investigating officer in cases of murder and terrorism is to find and check the relevant telephone records. David Anderson, the Independent Reviewer of Terrorism Legislation, has noted that almost all terrorist trials depend for a successful conviction on that kind of evidence. However, what has to be recognised is that new technologies are rendering that kind of evidence simply unavailable. In addition, even if that was not the case, which it is, young people—and I am afraid they will include some future terrorists and murderers—simply do not use as telephones what we at our average age believe to be telephones. They use WhatsApp, Snapchat and all the other things that the noble Lord, Lord King, mentioned, which use the internet as the means of communication over what is known as VoIP—voice over internet protocol. Without the Bill, the abilities of the UK police to protect our people will sharply diminish. As the noble Lord, Lord Rosser, said, that particularly grave position will be made worse if we lose European co-operation on intelligence sharing.
It is said that the defence of the realm is the most important duty of the state. The protection of individual citizens is the next most important duty of the state. Before finishing, I will just turn to the speech of the noble Lord, Lord Paddick. The noble Lord had a distinguished career as a senior police officer. However, while I admire his integrity and his openness about his own personal circumstances, I simply do not believe that any police officer experienced in surveillance, terrorism or organised crime would agree with what he said. We have recently heard a little too much running down of experts. I agree completely with the opening statement of the Minister, in which he made clear what experts in this area have said. To ignore their advice would make this country less safe.
Outcome of the EU Referendum
(8 years, 5 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Taylor of Holbeach (Con)
My Lords, with the leave of the House, it may be helpful if I make a brief business statement regarding our proceedings this afternoon and in the coming days. My noble friend the Leader will now repeat the Prime Minister’s Statement on the outcome of the EU referendum. Following discussions in the usual channels, we have made provision for 40 minutes of Back-Bench questions. I have also agreed to consider further extensions if at the end of 40 minutes there is still a significant number of Members wishing to ask questions.
I reassure noble Lords, however, that this will be the first of several occasions for the House to take stock of recent events. There is a European Council meeting later this week, and we intend to arrange a full debate next week—probably on Tuesday, in lieu of the Second Reading of the Policing and Crime Bill, which will be rescheduled to a later date.
The Lord Privy Seal (Baroness Stowell of Beeston) (Con)
My Lords, with the leave of the House, I will now repeat the Statement given by my right honourable friend the Prime Minister in another place. The Statement is as follows:
“With permission, Mr Speaker, I would like to make a Statement on the result of the EU referendum.
Last week saw one of the biggest democratic exercises in our history, with over 33 million people from England, Scotland, Wales, Northern Ireland and Gibraltar all having their say. We should be proud of our parliamentary democracy. However, it is right that, when we consider questions of this magnitude, we do not just leave it to politicians but rather listen directly to the people. That is why Members from across this House voted for a referendum by a margin of almost 6:1.
Let me set out for the House what this vote means, the steps we are taking immediately to stabilise the UK economy, the preparatory work for the negotiation to leave the EU, our plans for fully engaging the devolved Administrations, and the next steps at tomorrow’s European Council.
The British people have voted to leave the European Union. It is not the result that I wanted nor the outcome that I believe is best for the country I love, but there can be no doubt about the result.
Of course, I do not take back what I said about the risks: it is going to be difficult. We have already seen that there are going to be adjustments within our economy, complex constitutional issues and a challenging new negotiation to undertake with Europe. However, I am clear, and the Cabinet agreed this morning, that the decision must be accepted and the process of implementing the decision in the best possible way must now begin.
At the same time, we have a fundamental responsibility to bring our country together. In the past few days, we have seen despicable graffiti daubed on a Polish community centre and verbal abuse hurled against individuals because they are members of ethnic minorities. Let us remember that these people have come here and made a wonderful contribution to our country. We will not stand for hate crime or these kinds of attacks. They must be stamped out.
We can reassure European citizens living here and Brits living in European countries that there will be no immediate changes in their circumstances. Neither will there be any initial change in the way that our people can travel, in the way that our goods can move, or in the way that our services can be sold.
The deal we negotiated at the European Council in February will now be discarded and a new negotiation to leave the EU will begin under a new Prime Minister.
Turning to our economy, it is clear that markets are volatile and there are some companies considering their investments. We know that this is going to be far from plain sailing. However, we should take confidence from the fact that Britain is ready to confront what the future holds for us from a position of strength.
As a result of our long-term plan, we have today one of the strongest major advanced economies in the world and we are well placed to face the challenges ahead. We have low, stable inflation. The employment rate remains the highest that it has ever been. The budget deficit is down from 11% of national income and forecast to be below 3% this year. The financial system is also substantially more resilient than it was six years ago, with capital requirements for the largest banks now 10 times higher than before the banking crisis.
The markets may not have been expecting the referendum result but, as the Chancellor set out this morning, the Treasury, the Bank of England and our other financial authorities have spent the last few months putting in place robust contingency plans.
As the Governor of the Bank of England said on Friday, the Bank’s stress tests have shown that UK institutions have enough capital and liquidity reserves to withstand a scenario more severe than the country currently faces. The Bank can make available £250 billion of additional funds if it needs to support banks and markets. In the coming days, the Treasury, the Bank of England and the Financial Conduct Authority will continue to be in very close contact. They have contingency plans in place to maintain financial stability and they will not hesitate to take further measures if required.
Turning to preparations for negotiating our exit from the EU, the Cabinet met this morning and agreed the creation of a new EU unit in Whitehall. This will bring together officials and policy expertise from across the Cabinet Office, the Treasury, the Foreign Office and the Department for Business. Clearly, this will be the most complex and most important task that the British Civil Service has undertaken in decades, so the new unit will sit at the heart of government and be led and staffed by the best and brightest from across our Civil Service. It will report to the whole Cabinet on delivering the outcome of the referendum, advise on transitional issues and explore objectively options for our future relationship with Europe and the rest of the world from outside the EU. It will be responsible for ensuring that the new Prime Minister has the best possible advice from the moment of their arrival.
I know that colleagues on all sides of the House will want to contribute to how we prepare and execute the new negotiation to leave the EU, and my right honourable friend the Chancellor of the Duchy of Lancaster will listen to all views and representations and make sure that they are fully put into this exercise. He will be playing no part in the leadership election.
Turning to the devolved Administrations, we must ensure that the interests of all parts of our United Kingdom are protected and advanced. So as we prepare for a new negotiation with the European Union, we will fully involve the Scottish, Welsh and Northern Ireland Governments. We will also consult Gibraltar, the Crown dependencies, the overseas territories and all regional centres of power, including the London Assembly. I have spoken to the First Ministers of Scotland and Wales, as well as the First and Deputy First Ministers in Northern Ireland, and the Taoiseach, and our officials will be working intensively together over the coming weeks to bring our devolved Administrations into the process for determining the decisions that need to be taken. While all the key decisions will have to wait for the arrival of the new Prime Minister, there is a lot of work that can be started now; for instance, the British and Irish Governments will begin meeting this week to work through the challenges relating to the common border area.
Tomorrow I will attend the European Council. In the past few days I have spoken to Chancellor Merkel, President Hollande and a number of other European leaders. We have discussed the need to prepare for the negotiations, in particular the fact that the British Government will not be triggering Article 50 at this stage. Before we do that, we need to determine the kind of relationship we want with the EU. That is rightly something for the next Prime Minister and their Cabinet to decide. I have also made this point to the Presidents of the European Council and the European Commission, and I will make this clear again at the European Council tomorrow.
This is our sovereign decision and it will be for Britain—and Britain alone—to take. Tomorrow is also an opportunity to make this point: Britain is leaving the European Union but we will not turn our back on Europe or on the rest of the world. The nature of the relationship we secure with the EU will be determined by the next Government but I think everyone is agreed that we will want the strongest possible economic links with our European neighbours, as well as with our close friends in North America and the Commonwealth, and important partners such as India and China. I am also sure that, whatever the precise nature of our future relationship, we will want to continue with a great deal of our extensive security co-operation and to do all we can to influence decisions that will affect the prosperity and safety of our people here at home.
This negotiation will require strong, determined and committed leadership and, as I have said, I think the country requires a new Prime Minister and Cabinet to take it in this direction. This is not a decision I have taken lightly but I am absolutely convinced that it is in the national interest. Although leaving the EU was not the path I recommended, I am the first to praise our incredible strengths as a country. As we proceed with implementing this decision and facing the challenges it will undoubtedly bring, I believe we should hold fast to a vision of Britain that wants to be respected abroad, tolerant at home, engaged in the world and working with our international partners to advance the prosperity and security of our nation for generations to come. I have fought for these things every day of my political life and I will continue to do so. I commend this Statement to the House”.
My Lords, that concludes the Statement.
On my own behalf and as Leader of this House, I believe there is a particular role for the House of Lords in this period as we deliver on the clear instruction of the British people. We can provide stability by lending our experience, knowledge and expertise to the challenges we face, and add something different to the House of Commons in helping to make this decision work for Britain. Our EU Committee and its sub-committees are well placed to assist the House. As my noble friend the Chief Whip has already indicated, we will facilitate a debate in government time next week which will provide a further opportunity for the views of noble Lords to be heard.
Baroness Smith of Basildon (Lab)
My Lords, I thank the noble Baroness for repeating the Statement and for her additional comments at the end. They are welcome and concur with our own views.
These past few days have been the most difficult and uncertain that we have faced for more than a generation. Despite the massive turnout, whatever one’s views on the referendum, there can be no pride or joy in a result that has divided this country across regions, the age divide and ethnicity, and in so many other ways. With such a narrow result, we must find a way to work together.
During the campaign we were shocked and devastated that our much-loved and highly regarded Member of Parliament Jo Cox was murdered by a man who later gave his name as “Death to traitors, Britain first”. There can be no pride in a campaign that saw political debate sink to a new low.
The leave campaign told us that £350 million a day was being sent to Europe that would be available for the NHS. Within hours of the result that was being retracted as a “mistake”. However, it was never true and is not the only promise now being denied.
We have to understand why concerns are raised about immigration. However, throughout the campaign, the way in which immigration and asylum seekers were demonised to persuade people to vote leave was utterly shameful. I welcome the fact that Nigel Farage’s poster of fleeing Syrian refugees was condemned across the political spectrum and I welcome the comments in the Statement on hate crime.
However, we have to look to ourselves. Is there anything in our words and actions that could have led us to the position where anyone would consider that such a poster was acceptable and legitimate campaigning? When the Prime Minister referred in Parliament to migrants as a “swarm”, did he consider beforehand the possible consequences? During the London mayoral campaign, when Theresa May and Michael Gove spoke of security and terrorism, and then attacked Sadiq Khan as a risk, did they ever consider that such comments were reasonable and responsible?
I concur with the noble Baroness’s comments and welcome them. As she said, we are all dismayed at the reports over the last few days of targeted attacks on a Polish community and protests outside mosques. There has been an increase in casual and deeply unpleasant racism. We have heard of schoolchildren saying that they are worried about their future and, perhaps the lowest of the low, people wearing t-shirts with slogans such as “We won. Go home”. That is the price we are now paying for the tone of the political debate over the past few months.
We need to heal our country and our politics. We need to encourage and provide hope, not hate, but that will not be easy. Our country is desperate for the political leadership that is so sadly lacking at present. The Prime Minister, who said he would see us through the negotiations, is resigning, the Chancellor was invisible for days, and we face three more months of Tory party internal warfare before there is a leader who will even attempt to deal seriously with this crisis. That is shameful. I am not making a cheap party-political point; there are serious issues here.
Baroness Smith of Basildon
Wait and see, because I do not absolve my party leadership from this either. There is a serious issue about the quality of political leadership in our country as a whole. My party is also dealing with internal political problems, largely due to fallout from this result, and our country is crying out for strong, decent, decisive, caring and competent leadership from both Government and Opposition. Our country is entitled to demand such leadership from us at such a challenging time.
So what can we do? Individually and as a House as a whole, we have a responsibility. I believe—the noble Baroness emphasised this point as well—that we have the expertise, judgment and experience in this House to assist and lead in finding a way through. The role of your Lordships’ House in working through the referendum decision and in examining the detail will be essential. As we have already shown, the tone in which we conduct our debates and our deliberations must stay as it is, and we should show the way in being measured and honest.
Our excellent European Union Committee, chaired by the noble Lord, Lord Boswell, has already considered and reported on the process and difficulties of withdrawal, referred to by Sir David Edward, a leading—or probably the leading—expert in EU law as the,
“long-term ghastliness of the legal complications”,
which he described as “unimaginable”. However, we have to imagine them and to work through them.
There are many questions not yet answered and many may not have even been considered, so I shall ask the noble Baroness just three which I think are the most urgent. Today, we are debating the Investigatory Powers Bill. Obviously, the practical implications of such legislation are linked to our co-operation with other EU countries. Given that we shall at some point disengage and have to create a new, separate framework for those countries, what consideration has been given to this and are a rethink and further consideration required?
Secondly, the legislative programme cannot just be business as usual. Paragraph 67 of the EU Committee report states that the Government would need to enact in law everything that they wanted to keep in law which had come from treaties or a directive. Clearly, this cannot be done overnight, but our relationship with the EU is deteriorating by the hour and there is real urgency here. Have the Government considered a timescale for such legislation and will it mean a new Queen’s Speech, so that the legislative programme can be withdrawn?
Thirdly, the Statement referred to the devolved Administrations, but there was more about the role of the Civil Service than about the role of Parliament. Parliamentary oversight of the negotiations will be essential and, clearly, we will want to play our part in scrutiny and policy formulation. Can the noble Baroness give an assurance not just on debates but on parliamentary oversight of negotiations?
These past weeks have been challenging. That so many people took part and voted shows real interest and engagement, yet with such a binary choice it was harder to make the case for the complexities of what was involved and what could follow. Many who voted still wonder and worry whether they have made the right decision. There is no route map for what comes next. There is no long-term certainty for our economy or our society, and it is at times such as this that we have to rise to the challenge and ensure that what unites us is bigger, better and stronger than what divides us.
Lord Wallace of Tankerness (LD)
My Lords, I, too, thank the Leader of the House for repeating the Prime Minister’s Statement and welcome the words she added in respect of what your Lordships’ House may be able to contribute. I declare my interest as a Britain Stronger In Europe board member.
As a democrat, I respect the outcome of Thursday’s referendum, but—I suspect like many colleagues across the House—I am profoundly saddened by the result. I have a deep anxiety about what the future holds for our country. I am worried about the divisions that have been laid bare across the country during this campaign and echo many of the concerns expressed by the noble Baroness, Lady Smith of Basildon, about the tone of much of the debate and the campaigning. I am fearful for what this means for our outward-looking and tolerant country as well as for the future integrity of the United Kingdom. Many on these Benches are angry that notwithstanding his fine words in the Statement about his vision for Britain, this Prime Minister put party interest before national interest, complacently believing that he could win a referendum primarily designed to settle internal Tory divisions.
The European Union is an institution to which we have belonged and contributed for the past four decades. It has delivered peace, promoted equality, kept us safe and opened the doors of opportunity, but it will no longer be a part of Britain’s future. I think too that the leave campaigners do not appear to have any plausible strategy. We have already seen that they are backtracking on many of the promises they made during the campaign. So the result will change not only the very fabric of our country, it will change Europe and our relationship with the wider international community. Regrettably, the United Kingdom has on many occasions failed to provide leadership in the European Union. As a result, the people of this country have seen Governments play a half-hearted role at best. There has been a failure domestically to make the positive case for the European Union and the benefits it brings. In some ways, therefore, it is not unsurprising that when faced with years of the EU being blamed for everything that is wrong in this country, a majority of people voted to leave.
But I fear that we are only just beginning to realise the adverse impact the vote will have. Since Friday morning we have seen the value of sterling plummet. Some £120 billion was wiped off the markets in the first 10 minutes of trading on Friday, while this morning sterling slipped another 2.6% against the dollar and the pound is at a 31-year low. Surely the leaders of the leave campaign owe it to us to tell us what they think is negotiable with other members of the European Union, what is not negotiable in spite of their many promises, and what the likely consequences will be for the British economy. I welcome the fact that the Chancellor of the Exchequer and the Governor of the Bank of England have tried to steady the markets this morning, but fundamentally it is the uncertainty of the United Kingdom’s position which will continue to cause nervousness in the economy. Businesses and the markets like certainty, but certainty would appear to be the last thing we have in the wake of the referendum.
I have a number of questions for the noble Baroness. Can she indicate what the present Government would wish to achieve in negotiations with the European Union? Do they believe that we should seek complete access for the United Kingdom to the single market? Do the Government even have a view? Given that younger voters overwhelmingly voted to remain in, what hope can the noble Baroness and the Conservative Party offer future generations that they will have the same access to jobs across Europe as previous generations?
Of course it is not just the economy that is uncertain, but the very fabric of our constitution. Article 50 states:
“Any Member State may decide to withdraw from the Union in accordance with its own constitutional requirements”.
I think that the House will be interested to know what the Government’s view is as to what our own constitutional requirements are. Are they an Act of Parliament, a resolution of the House of Commons, a resolution of both Houses or an executive decision by Members? That is an important question for the noble Baroness to answer.
Scotland and Northern Ireland both voted strongly to remain in the European Union and the Secretary of State for Scotland has said that, if the people of Scotland ultimately determine that they want a second Scottish independence referendum, there will be one. Can the noble Baroness confirm that that is the position of the United Kingdom Government? Does it mean that if the Scottish Parliament asks for a further referendum, the Government will bring forward an order under Section 30 of the Scotland Act 1998 to transfer the necessary powers for a referendum to take place?
Northern Ireland as we know shares a land border with another EU country. Thousands of people cross it every day in both directions visiting friends and family, while the economy of Northern Ireland relies heavily on the European Union as a pull factor for internal investment, and directly in the form of research and development grants and peace grants. Can the noble Baroness set out the Government’s understanding of the operation of the common travel area where one country is an EU member and the other country is not? Can she also say something about mandate—the mandate of a future Prime Minister elected not by the country but by members of the Conservative Party, and what that means in terms of taking back control?
The leave campaigners have now admitted that they cannot do much to reduce immigration, so we need a serious and informed public debate about the long-term challenge of immigration. However, the anti-immigration rhetoric we have seen during the campaign has encouraged a surge of right-wing resentment. Perhaps the noble Baroness will wish to elaborate more on what the Government intend to do to tackle that. Finally, although I very much respect the decision of the noble Lord, Lord Hill of Oareford, to resign his position as a European Union Commissioner, we are still members of the European Union. Can she give an indication of the timescale for Britain to nominate another EU Commissioner so that we do not actually have an empty seat at the table?
We on these Benches firmly believe that it is in the United Kingdom’s best interest to stay as closely engaged in European networks of co-operation and joint operation as possible. We will continue to make the case for Britain’s future with Europe and to fight for an open, optimistic, hopeful, diverse and tolerant United Kingdom.
Baroness Stowell of Beeston
My Lords, as always I am grateful to the noble Baroness and the noble and learned Lord for their responses and I will seek to provide answers to some of the questions they have put forward this afternoon. I must start by saying that the British people have decided that we should leave the European Union and our priority now must be making this decision work for everybody in the UK, whatever side of the debate we were on. I am proud that this Government promised a referendum and delivered it and that we trusted the people with this very important decision. I voted and campaigned for remain, but a decision has been made, it is a clear one and it is very important that we get on now with implementing that decision and doing so in a successful way for the benefit of everybody who lives here.
I turn to some of the comments and questions put forward by the noble Baroness and the noble and learned Lord. As the noble Baroness knows, I was very shocked, like everybody else, by the death of Jo Cox. On the points she made about racism and some of the things that have been said and done in recent times, I do not want to debate again the way the campaigns were conducted, but I want to make some important points. The first is that whatever the result of this referendum and our decision to leave the European Union, this country has not given up on its values. We are still the United Kingdom and our values remain exactly as they were. I would condemn anybody who used the result of this referendum as an opportunity to promote racism. If there is any evidence of that, we should all work together to stamp it out. I certainly urge anybody who has experienced any kind of hate crime or racism to alert the police to that straightaway and to know that they do so with the full support of every decent person who lives in this country.
The noble Baroness referred to the role of this House and to political leadership in this country. As I said in my initial remarks as I concluded the Prime Minister’s Statement, this House has an important role to play. It is important for us to demonstrate our value to the democratic process by offering something that is a bit different from the House of Commons. One of the ways I hope we are able to achieve this, through our debates over the next few weeks as we consider the way forward on leaving the European Union, is that we are a little less political than the other House. That is one thing that is important about us, for which we attract a lot of positive response.
On the noble Baroness’s question about our current legislative programme—she referred to the Investigatory Powers Bill—the Government were elected on our manifesto commitments. We have a clear mandate and an important legislative programme that we have to continue to deliver. The Investigatory Powers Bill is one of the very important pieces of legislation that will safeguard the security and safety of people here in the United Kingdom. As for the impact on any of our legislation, we are in the European Union until we are out of the European Union and we have not yet triggered the Article 50 process that will put that process in train. We must very much continue with our programme and we have a mandate for that programme from the election of only one year ago.
The noble Baroness asked about the devolved Administrations and the role of Parliament in overseeing the process over the coming weeks and months. The noble and learned Lord also asked about Parliament’s role and what opportunity it will have to contribute to the decisions before final exit is made. It is too early for me to say what that might be, but as I hope I have indicated, I see it as an important part of the process that Parliament has a serious opportunity in this House to debate and express its views, and there is a role for our European Union Committee and its sub-committees to play in this process.
The noble and learned Lord asked about a couple of things in addition to the topics that the noble Baroness raised, the main one being Scotland and Northern Ireland. The people of Scotland made a very clear decision only two years ago that Scotland should remain in the United Kingdom. The Prime Minister has made it clear today—I very much echo the point—that in the way we proceed from here, we must work closely with the devolved Administrations. We will continue to do that, because we want to ensure that the way we exit from the European Union is to the benefit of all parts of the United Kingdom and all its people, so our constructive discussions will be a very big part of how we move forward from here.
Lord Hague of Richmond (Con)
My Lords, is it not deeply unfortunate that an inevitable side-effect of this referendum result is that we have lost an outstanding Prime Minister who has given long service to this country and had more to give? Although it was his decision to hold an in/out referendum, we should remind the noble and learned Lord, Lord Wallace, that not long ago, in the general election of 2010, that was the policy of the Liberal Democrats as well, so they should not be too condemnatory about that. But will my noble friend broaden the thoughts rightly expressed in the Statement about bringing the country together to include the need for the economic and foreign policies pursued by a country leaving the European Union to be able to command the support of the millions of people who voted to remain in the European Union? Will that not be an essential attribute of a re-formed Cabinet and of a new Prime Minister?
Baroness Stowell of Beeston
My noble friend is absolutely right and I join him in paying great tribute to David Cameron as Prime Minister: it has been an honour for me to serve in his Government and his Cabinet. He is a remarkable man in the way he carries out his responsibilities as Prime Minister.
My noble friend said that we must ensure that the way we proceed from here commands the support of everybody in the United Kingdom, especially those who did not vote for us to exit. That is absolutely essential, and the next Prime Minister and his Government must give absolute priority to it.
Lord Reid of Cardowan (Lab)
My Lords, although I quite understand people complaining about the campaign, we are where we are, and the priority surely should be to try to give some political stability, and through that financial and other stability, at a time when, for all their personal qualities, it is obvious that the present Prime Minister and his opposite number across the Dispatch Box are completely lacking in authority on the subject of Europe.
I therefore want to ask one specific question that concerns the reassurances that nothing much will change in the short term and Article 50 has not been operated. What overtures were made to the British commissioner to persuade him not to resign with immediate effect, particularly given the crucial area of finance and financial services over which he had responsibility? I quite understand his personal position but can the Government assure me that they made every conceivable effort to make sure that the United Kingdom commissioner in charge of finances would be in place for the next few months? If they did not do that, it was another huge omission.
Baroness Stowell of Beeston
I am grateful to the noble Lord for giving me an opportunity to say how much I admire my noble friend Lord Hill, as my predecessor in this role and also for the work that he has done as a commissioner. He set out his reasons for deciding to step down from his role and the Commission decided to move his responsibilities to another commissioner.
Financial stability is clearly being given huge priority within government. We have heard from the Governor of the Bank and from what the Chancellor said this morning all the steps that have been taken so far to provide stability to the financial markets, and their readiness to go further, should that be necessary. But we must not forget that the reason we are in a strong position to deal with this situation is the progress that we have made over the last few years in ensuring that we have a strong economy and can deal with this situation. I absolutely acknowledge that the situation is uncertain, but we can deal with it.
Lord Boswell of Aynho (Non-Afl)
My Lords, I, too, welcome the Leader of the House’s repeating of the Statement and the personal postscript that she added in relation to the role of this House, and specifically of the EU Select Committee which I have the honour to chair. Will she therefore confirm to the House that at all stages, however long it takes, in the complex process of withdrawal and the development of a future relationship with the European Union, it is essential—perhaps more than it ever has been before and, to be frank, more than was evidenced during the process of the Prime Minister’s now aborted renegotiation bid over the last 12 months—that both Houses of Parliament should be informed and enabled so that they may make a full and constructive contribution to the discussion of these crucial issues? Frankly, this is a moment of crisis. In the interests of both this country and, we should not forget, its immediate neighbours and their economies, too, must not an opportunity be provided to enable the collective wisdom and experience of this House to be heard?
Baroness Stowell of Beeston
My Lords, I certainly acknowledge—as the noble Lord noted—that there is a huge amount of expertise and knowledge in this House that will make a strong contribution to the process. I am not in a position to provide the detail for which he asked. However, I will pick up on an important point that he made: while we have a big task in front of us in negotiating our exit and a new relationship with the European Union, we have strong bilateral relations with other member states within the European Union and, indeed, other countries around the world. We must continue with those relations, and continue to strengthen them, during this process.
The Lord Bishop of Chelmsford
My Lords, some commentators have said that the result of the referendum was a resounding victory for Brexit. I am not sure that I see it that way: 52 to 48 is, to my mind, a rather narrow victory. Where there is no overwhelming consensus, there is an overwhelming need to take account of the views of others. Nobody likes a bad winner. There has been too much hyperbole and spite in this debate. Yes, one side did win, the result is clear and we have to act on it. Those who advocated leave obviously need to take the lead in the negotiations that will take place. But we urgently need the sort of wise leadership that can build consensus. We need some sort of national Government—a coalition of good will where we can work together.
I serve the diocese of Chelmsford, which is, “east London in and Essex out”. Yesterday I spoke to a head teacher who said that the children were frightened when they went to school on Friday and that she had seen an increase in race hatred and intolerance. What plans are there to address the lack of unity in our nation and to counter the fear and race hatred that is on the rise? Can we ensure that those who lost this vote, as well as those who won, can be part of the planning going forward?
Baroness Stowell of Beeston
The right reverend Prelate’s remarks covered a large amount of ground. Although I said that we could, perhaps, do with a little less politics in this House than in the other place, I would not go quite as far as his proposal for the future. But he makes an important point about us avoiding becoming a divided nation as a result of the referendum. All of us who are involved in politics, or business, or who have other positions of authority and responsibility, have to properly understand what people feel when they express their views. During the campaign and over the last few months, I was interested in comments about people no longer wanting or respecting experts. I do not agree with that analysis but people want to feel, more than they do now, that experts understand why they feel the way they do. People may not feel they have benefited from the turnaround of the economy, or have felt left out of many of the advances we have made over the last 10, 20 or 30 years. As we proceed, we all have a responsibility to keep trying to reassure them that we understand why they feel the way they do and why they voted the way they did. We must now make sure, in the way that we implement the country’s decision, that we bring everyone along with us and that everybody in this country feels that they have a proper opportunity to fulfil their potential.
Lord Taylor of Holbeach (Con)
My Lords, if we go round the House, it is actually the turn of the Liberal Benches.
Baroness Kramer (LD)
My Lords, I am very much concerned about some of the complacency that I am currently hearing from the Government. Since the noble Baroness the Leader of the House and others on the Conservative Benches have the opportunity for direct conversation with the collection of MPs, one of whom will be our future Prime Minister, would they convey this? The City is already making its decisions, as are major businesses. Most of them started planning for the contingency of leave months ago. Over the weekend, we have heard very clearly, and the CBI have confirmed, that many major firms have put on a hiring freeze. Others are now reassuring their shareholders that they have plans in place to be able to move significant parts of their operations to continental Europe or Ireland. If they do not hear a clear commitment, a cast-iron guarantee, in a matter of days—possibly weeks, but certainly not months—from that group from which the Prime Minister will come, that we will remain wholly in the single market, the decisions will become irreversible. Many already are and the remainder and many more will happen. Complacency is not safe.
Baroness Stowell of Beeston
I reject the noble Baroness’s description of this Government as complacent. What has been evident over the last few days in what was said by the Chancellor this morning, by the Prime Minister today and by the Governor of the Bank of England on Friday is that there are measures in place to provide some stability within the markets. The noble Baroness is of course right that businesses will take decisions now that could affect people. We need, through a range of methods, to make sure that we project to the world outside that Britain is in a strong position to weather this period of uncertainty arising from the referendum decision. We can do that, and do it with confidence, because of the steps that we have taken over the last few years to strengthen our economy and to make sure that we are ready for whatever decision that followed. I also say to the noble Baroness and to the House that we remain a member of the G7 and of the G20, and through those kind of forums we have an opportunity to project that very strong and confident message as well.
Lord Lawson of Blaby
My Lords, as one of the minority in your Lordships’ House who warmly welcomes the decision that the people made in the referendum, I also warmly welcome the statesmanlike Statement of the Prime Minister today, which my noble friend repeated. May I suggest, too, that the campaign is over and that we are now in a new phase, and that it would be no bad thing if the campaigning organisations on both sides should shut up shop? I speak as somebody who took a prominent part in one of them. What has happened was implicit in the Prime Minister’s speech: the people have spoken and it is now for the Government to implement wisely the decision of the people.
In that context, I welcome the Prime Minister’s decision to involve the brightest and the best in the Civil Service in charting the way ahead. I believe that there is a great way ahead. Nobody should be put off by financial market volatility—I knew quite a lot of that when I was Chancellor. Financial markets are by their nature volatile. What matters are the economic fundamentals, which are good now and can get even better if we pursue a sensible policy. I regret the fact that the Treasury for a moment morphed into the office for budget irresponsibility but the Treasury can play a great part. I warmly welcome the approach that was charted in the Statement. Does my noble friend agree that the campaigning organisations should now shut up shop on both sides?
Baroness Stowell of Beeston
I certainly agree with my noble friend that the campaign is over. The public have spoken and we now all have a responsibility to implement that decision—and, as I have said, in a way which means that it is successful and in the best interests of this country. As my noble friend says, it is right that we are using the brightest and most talented civil servants to that end. Indeed, I am sure that we will draw upon a wide range of expertise outside Whitehall as well.
Lord Mandelson
My Lords, for the next two years the United Kingdom is entitled to have a commissioner in Brussels during a time when vital national interests will be considered by the Commission and the other EU institutions. Will the noble Baroness inform the House when that vacancy is going to be filled?
Baroness Stowell of Beeston
I am grateful to the noble Lord for that direct question but, unfortunately, I am not in a position to answer it in a direct way. At some point, I hope very much that I will be able to come back to him and make that information more widely available.
Lord Butler of Brockwell (CB)
My Lords, will the noble Baroness confirm that the UK’s departure from the EU will not become final until our negotiations over the next two years are complete? Since the terms of our departure will only be known then, will it not be the duty of the Government to give the people a chance to take an informed view on those terms before the UK’s departure becomes final?
Baroness Stowell of Beeston
It sounds as if the noble Lord is trying to suggest a second referendum at a later point. This has been a once-in-a-generation decision. The people of this country have been clear. When we trigger Article 50 the clock on the two-year process will start. The Prime Minister has not triggered it now because he believes that it is right that when going into that process the Government are clear on what kind of relationship they want with the European Union in future. That is why he is not doing so himself but is leaving it to his successor.
Baroness Smith of Newnham (LD)
My Lords, like the noble Lord, Lord Lawson, I welcome the creation of an EU unit in Whitehall, although one wonders why it did not exist already—I think that in some incarnations, it did. In particular, the idea of bringing together policy expertise is welcome. What provision is there for cross-party and non-party involvement in setting the mandate for those civil servants? After all, Vote Leave was a cross-party thing—it even had a Liberal Democrat on its board—and the remain campaign was also cross-party. Surely in the national interest the new Prime Minister should be looking across the spectrum to get the best input so that whatever deal we get really is the best for the whole of the United Kingdom and not just something that narrow parties can bring about?
Baroness Stowell of Beeston
Clearly the campaigns for leave and remain were cross-party, but there is one party in government. It was elected last year and this elected Government will have the responsibility, albeit very much, as I have already indicated, wanting to draw on expertise and knowledge from a range of different sources, of deciding what precisely they are going to seek to negotiate with Europe in terms of our future relationship.
Lord Howell of Guildford (Con)
My Lords, although in the next few weeks or even months we are obviously in a period of very painful adjustment—that is perfectly obvious—does my noble friend agree that it ought to be perfectly possible to achieve practical and constructive relations with all our European neighbours in the near future? I say that not just because it is a desirable thing for us to do but because the European Union itself is undergoing enormous changes and challenges at this moment and we are required to have a very constructive voice, whatever our status under the treaties. Does my noble friend agree that that approach will at least reassure our many friends all around the world and enable us to contribute to the continuing development of a strong Commonwealth network which will be a great support for us in future?
Baroness Stowell of Beeston
My noble friend is absolutely right. In addition to our relationships with other countries via those established institutions, whether they are the European Union, the Commonwealth, which we are absolutely still part of, the G7 or the G20, we will continue to build and strengthen our relations with other countries.
Lord Taylor of Holbeach
It is the turn of the Labour Benches. I hope that the Cross Benches will have an opportunity of getting in after that.
Lord Anderson of Swansea
My Lords, the Prime Minister made a very dignified statement on the steps of No. 10 last Friday. He again made a dignified Statement today in the other place. He is a decent and honourable man. Would it therefore not be very sad if future historians were to see his legacy as having made a very powerful statement against referendums a few years ago and then changing his mind because of a will-o’-the-wisp, illusive attempt to find party unity, a legacy which led to Britain leaving the European Union and, potentially, breaking up our own United Kingdom itself?
Baroness Stowell of Beeston
I am grateful to the noble Lord for the positive comments that he has made about the Prime Minister, but I am afraid I disagree with him about everything else that he has said. We were very clear in our manifesto that we wanted to provide the British people with an opportunity to decide on membership of the European Union. As I have already said, I am very proud that we gave people this opportunity and delivered on that clear commitment. We have arrived at a point that, as I was trying to suggest earlier, has been a long time coming. This is not about party unity, this is about giving people the opportunity to decide on something very significant. The people have decided they want change, and we have to respect that. It is not what I campaigned for, but they have decided. We are going to implement that decision, which is the right thing for us to concentrate on now.
Lord Hannay of Chiswick
My Lords, would the Leader of the House agree that the timing of the triggering of Article 50 ought to be a relatively trivial and technical decision? It is entirely reasonable for the Government to say that they do not wish to do it until there is a new Prime Minister and a new Government in place. That is a reasonable point of view. But it would not be reasonable to start using it as a negotiating card and turning it into a bone of contention with those with whom we are going to have to negotiate constructively if we are to get a good outcome. I hope that she can agree that that is indeed the best way forward. The noble and learned Lord and the noble Lord, Lord Mandelson, raised the matter of the appointment of a British commissioner. The noble Baroness says that she will come back on that when she has an answer, but could she not register that it would be completely improper, under the terms of the treaty, for there to be no British commissioner for a period that could exceed two years? That really is not tolerable, either for us or for the Commission itself.
Baroness Stowell of Beeston
On the noble Lord’s first point, as I have said, it was a very clear decision by the Prime Minister that Article 50 should be triggered by his successor at the point at which they are clear on the kind of relationship that we are seeking with Europe. It has been reassuring that many other European leaders and senior figures within the European Union have acknowledged that we are right to consider this properly before we trigger Article 50.
Lord Maclennan of Rogart (LD)
My Lords, does the Minister not agree that Parliament is the constitutional sovereign power of the United Kingdom and that, consequently, referenda should be seen as advisory in nature? The nations of the United Kingdom did not vote in the same way in support of leaving. The United Kingdom Government have the presidency of the EU in the second half of next year and could therefore put forward procedures for reconsidering the structure of the European Union then.
Baroness Stowell of Beeston
I am grateful to the noble Lord for his comments but I am afraid the situation we are in is very clear. The British people have made their decision, and we are not going to seek to do anything other than implement it.
Lord Forsyth of Drumlean (Con)
My Lords, I gently point out that this is an unelected House and that the people have spoken. Instead of identifying threats, we should cheer up and identify the huge opportunities that are now available for Britain outside the European Union. I welcome the Prime Minister’s Statement and, in particular, the express promise to work with the devolved Administrations. In meetings with the First Minister of Scotland, can it be gently pointed out to her that she campaigned across the United Kingdom on a question that was decided by the United Kingdom? There was no Scottish question on the ballot paper; it was a United Kingdom question. As such, she and everyone in the United Kingdom should now do everything they can to advance Britain’s interests and not undermine them by seeking to do side deals in Brussels, which will make it more difficult for us to get the best deal for the whole of the United Kingdom.
Baroness Stowell of Beeston
My noble friend is right that this decision applies to the United Kingdom as a whole. I very much note the points that he makes but, as I have already stressed, in our involvement with the devolved Parliament and Assemblies we will seek to make sure that the outcome benefits everybody in all parts of the United Kingdom. We will engage in a way that is not just constructive but very positive, because that will be in the interests of the Scottish people.
Lord McConnell of Glenscorrodale (Lab)
On that very point about the people of Scotland and the way that they voted last week, it is important for your Lordships’ House to note that there was not just a small difference between the vote in Scotland and the vote in England and Wales; every single local authority area in Scotland voted overwhelmingly to remain in the European Union. That creates a significant difference between Scotland and England and Wales—not Northern Ireland, obviously—which has to be reflected in the discussions over the next two years. I welcome the fact that the First Minister of Scotland showed leadership over the weekend and said clearly that her number one objective in these discussions will be not to seek independence for Scotland or a second independence referendum but to secure Scotland’s relationship with the rest of the European Union. I should like an assurance from the Government that they will contribute positively to that discussion over the coming months and ensure that the First Minister has a role in the discussions in Brussels, not just in Whitehall.
Baroness Stowell of Beeston
I cannot give the noble Lord the assurance that he is looking for because it is just too early to be able to provide that kind of information. I understand the point that he makes about the difference of view in Scotland but the same can be said for the people of London; it was not just Scotland where a majority voted to remain. I come back to what I have already said: we are now seeking to implement a decision that was taken as the United Kingdom, and that is where we must focus our attention. However, that does not in any way diminish the Prime Minister’s commitment to involve all parts of the United Kingdom in the process—and that includes the London mayor and the London Assembly.
Lord Low of Dalston (CB)
My Lords, I am afraid that I do not find myself in sympathy with the views expressed by the noble Lord, Lord Lawson; I find myself rather closer to the point of view expressed by the noble Lord, Lord Butler. Does the noble Baroness the Leader of the House not agree that those in the leave campaign won the referendum on an essentially fraudulent prospectus? They said that we could continue to trade with the EU on very similar terms without having to accept freedom of movement. They said that there would be no adverse economic consequences, but we are already beginning to see them. They made completely unrealistic promises as to what could be done with the resources saved from our EU contribution—and, most glaringly of all, with breath-taking cynicism and within hours of victory they were maintaining that they never said that Brexit would enable them to reduce the level of immigration.
Moreover, it is clear that the leaders of the leave campaign have absolutely no plan as to the way forward. In these circumstances, and notwithstanding claims of democracy, does the noble Baroness not agree that the legitimacy of the referendum result is substantially undermined and that there is a very strong case for a second referendum on a more precisely focused question—something that nearly 4 million people have already signed a petition in support of?
Baroness Stowell of Beeston
I am afraid that I do not agree with the noble Lord. I am not going to comment on the different campaign teams and their campaigns. In my view, the people who voted to leave the European Union last Thursday knew that they wanted to leave the European Union. Their decision may have been motivated by a range of different things, but suggesting that they did not know what they wanted and that we should therefore somehow now seek another referendum to ask them, “Are you sure?”, is not the right way for us to go from here. I think that the right thing for us to do now is to focus on implementing that decision and to do so in a way that brings success and opportunity to the people of this country. We should make sure that it delivers a future that is good for everybody in this country.
Lord Lester of Herne Hill (LD)
My Lords, we are a parliamentary democracy in which Parliament is meant to be supreme. The leave campaign focused on restoring the powers of Parliament as one of its aims. Can the Leader of the House tell the House whether, before triggering Article 50 of the treaty, the Government will seek the approval of both Houses? If not, what do the Government envisage to be the role of Parliament? Will they rely purely on prerogative powers like a medieval king or will they involve our supreme legislature before taking the decision?
Baroness Stowell of Beeston
As I have already said, clearly it is very important that Parliament has a role in this process, but at this time I am not able to specify what that role is.
Lord Cormack (Con)
My Lords, does my noble friend accept that an enormous responsibility lies on the shoulders of the members of the Conservative Party in this country? They will be choosing not only a leader of the party but effectively a Prime Minister. Therefore, is it not crucial that they take into account the qualities of those who may be on offer, bearing in mind that we need a steadying hand on the tiller and someone who has the gift of statesmanship, and that the gifts of demagogy are not necessarily the same as the attributes of statesmanship?
Baroness Stowell of Beeston
My noble friend sets out the terms under which he will judge any contenders in the Conservative Party leadership contest.
Baroness Morgan of Ely (Lab)
My Lords, in July 2017 the UK is due to take up the presidency of the European Council. Can the noble Baroness tell us whether the UK will indeed take up that position and what on earth it will put on the agenda of that presidency?
Baroness Stowell of Beeston
That is one of the issues that will have to be decided in the next months.
Lord Tebbit (Con)
My Lords, is my noble friend aware that on Friday morning I woke not only with a song in my heart but with the words of the “Magnificat”—
“He hath put down the mighty from their seat and hath exalted the humble and the meek”—
in my heart, as we had won the referendum? Can she tell me whether the British Commissioner, whoever may be appointed, is allowed by the terms of his oath of office to pursue the British interest as opposed to the interest of the EU? I thought that the oath was very clear on that matter. Am I wrong about that?
Baroness Stowell of Beeston
I am afraid I am not familiar with the terms of the oath that commissioners take when they are appointed. My noble friend, as always, makes an interesting remark.
Baroness Stowell of Beeston
My Lords, as my noble friend the Chief Whip indicated at the start of this Statement, while we must respect the fact that there are a number of noble Lords who are down to speak at Second Reading of the Investigatory Powers Bill, so I do not want us to go on for too long, I can see that there are still at least four noble Lords seeking to ask a question. I am very happy, even though the clock will go beyond 40 minutes, to finish answering the questions of those noble Lords who have already indicated that they wish to ask one.
Lord Elystan-Morgan
My Lords, will the noble Baroness give a solemn undertaking—
Lord Taylor of Holbeach
Perhaps we can hear from the Cross Benches, then from the Labour, Lib Dem and Conservative Benches.
Lord Elystan-Morgan
My Lords, I am deeply grateful. Will the noble Baroness give an undertaking to the effect that before even contemplating activating the machinery of Article 50, the Government will first of all take into account the solemn voice of the two legislatures, and that failing to do so would be to abrogate and render nugatory the whole concept of parliamentary sovereignty? It is extremely sad and ironic that in the light of the European Union Act 2011 it is necessary for there to be a referendum and a parliamentary resolution before there can be any acquiescence to change. Indeed, it would be very strange that an act so existential as leaving the Union could take place without a parliamentary decision.
Baroness Stowell of Beeston
I am grateful to the noble Lord for his question but I am afraid I have nothing to add to what I have already said. In the interests of time, I will leave my comments at that.
Lord Davies of Stamford
I have given way several times right from the beginning.
Lord Taylor of Holbeach
I think the noble Baroness, Lady King, comes first.
Baroness King of Bow
My Lords, our constitutional role in this House is to scrutinise legislation and say to those in power, “Pause, reflect and vote again”. It is not a popular role, and I know that I will not be popular saying it here today. None the less, the House of Lords should ask those with power—in this case, the British people—to do the same thing that we ask the Government to do all the time: pause, reflect and vote again. They can vote the same way if they want—the Government do that all the time, don’t they?—but let us bear in mind that the British people were asked if they wanted the UK to remain or leave the EU. They were not asked if they wanted to break up the UK. Given that that is just one of the disastrous likely consequences, it is only fair that they should have that opportunity. In light of the petition, will the Government consider setting up a Joint Committee with the Commons simply to weigh the arguments for and against a second referendum, which may be at the end of the two-year process? If the answer is no, what happens if the online petition gets more than 17 million British signatories?
Baroness Stowell of Beeston
The noble Baroness raises an interesting point. I really do not have much to add to what I have already said. On the contribution of this House to our deliberations, I have set out how that should at least start. The people’s decision is clear on this matter.
Lord Campbell of Pittenweem
My Lords, the noble Lord, Lord Reid of Cardowan, said that we are where we are. He is quite right. Where we are is a country divided socially, economically and politically, where the very future of the United Kingdom is now at stake and with at least two years of economic uncertainty ahead. Is it not a bit rich that those who are responsible for creating these circumstances, apart from congratulating themselves, seem to want to take no involvement or interest in implementing the very decision for which they are responsible?
Baroness Stowell of Beeston
I am not sure that is quite how I would consider the situation. Clearly what has happened is that this Government believed that the UK should remain in the European Union, and we campaigned for Britain to do so. A decision has been made by the people to leave. The Prime Minister has accepted that decision and said that it has to be for his successor to implement it. That will be the way that we move from here.
Lord Higgins
My Lords, the decision that was taken last week has been widely described as democratic. However, it is not what we in this country have understood to be democracy—at any rate, since the time of Edmund Burke. We believe in a representative system of parliamentary democracy where Members of Parliament are elected as representatives, not as delegates, and therefore can take into account all the arguments and not be misled by the kind of misleading propaganda and lies that we have had in this referendum, which has shown very clearly what the disadvantages of a referendum are.
The fundamental problem with a referendum is that it is the dictatorship of the majority—in this case, a very small majority. It is therefore crucial now that our parliamentary system, in the light of what has been said but taking into account the divisions that are so apparent in society, does all that it can to ensure that the implementation of the result of the referendum takes into account the whole range of opinion across the electorate, not simply of those who happen, by a really rather small majority, to have won the debate.
Baroness Stowell of Beeston
My noble friend is right that in moving from here it will be essential that we do so in a way that unites all parts of the country, particularly those who voted a different way.
There is a point about parliamentary democracy that I have not already made: as I have said, this was in our manifesto. We passed an Act of Parliament to bring forward the referendum, and that piece of legislation went through both Houses. We debated the terms of the referendum. This Parliament decided those terms and they were the ones that applied. We must remember that. We have all contributed to the way in which the rules were set and the way that the people of this country then exercised their democratic right to vote in the referendum.
Lord Davies of Stamford
My Lords, surely the point well made by the noble Lord, Lord Low, about a dishonest prospectus cannot be honestly contested on the facts. The Daily Telegraph itself wrote this morning:
“The Leave campaign misled the nation about the full risks of Brexit and what can be achieved without collateral damage to the economy and the unity of”,
the UK. In those circumstances, and very much following on from what the noble Lord, Lord Higgins, just said, is it not the responsibility of Parliament to ensure that before we pass a line of legislation on this matter, we assure ourselves that the Government have plans in place that are viable, coherent and genuinely in the national interest and do not have any hidden costs attached to them?
Baroness Stowell of Beeston
I hear very much the points that the noble Lord has made but they are very similar to points that have already been made that I have responded to. I do not have anything more that I can usefully add at this point.
Lord Stoddart of Swindon (Ind Lab)
My Lords, I was never in favour of joining the Common Market, and I have always wished to withdraw from the European Union so that we could govern ourselves. I rejoice at the instruction that the people have given us. If those people who are calling for a second referendum had won the existing one, I wonder if they would still be calling for another referendum. I very much doubt it.
I want to ask the noble Baroness a couple of questions. First, is it not necessary first of all to repeal the European Communities Act 1972, as amended? Secondly, if we remain in the single market, will we not still be obliged to agree to free movement of people and will not all of British industry be subject to the rules and laws of the single market?
Baroness Stowell of Beeston
As for as the legal process for exiting the European Union, triggering Article 50 is the only legal process for us to follow. It will clearly be led by another Prime Minister, but I am sure that we as a nation will want to do it responsibly. The noble Lord asks about the repeal of the 1972 Act. That would not occur at this stage, because it would be contrary to our wanting to exit from the European Union in a responsible manner. As for his question about the single market, yes, my understanding is that if we were to remain in the single market, it would require free movement of people.
Lord Taylor of Holbeach
My Lords, I think I will ask my noble friend Lord Blencathra, who has been trying to get on his feet for the whole period of the Q&A.
Lord Blencathra
My Lords, I have been trying to get on my feet for a few years. As we conclude on the Statement today, as my noble friend the Leader noted, every major elected politician in the other place has said that, while they may not like the result, it must be respected and it must be implemented. Will she therefore caution some of my noble friends and all noble Lords that if we wish to unite the nation after this, this unelected House must not seek to thwart the will of the people by going into endless negotiations on or amendments to the minutiae of any legislation, which would be seen as a direct attempt to sabotage the will of the people?
Baroness Stowell of Beeston
As my noble friend knows, he and I were on different sides of the argument during the campaign, but I absolutely agree that the decision has been made, it must be respected and it should be implemented.
Lord Pearson of Rannoch
My Lords, do the Government agree that it would help to calm the markets and help our informal and later formal negotiations if our negotiators show now and clearly that they understand the difference between the single market and free trade? They should explain that we are in an irresistible position to maintain our free trade, which is what our businesses really need, because there are more than 2 million jobs, principally in Germany and France, making and selling things to us than we have making and selling things to them. That applies particularly to the motor trade, where we have been threatened with a 10% tariff, but for every car we sell them they sell us 2.4 cars and they own 64% of our domestic market. Can we make the distinction between the single market and free trade and decide that it is free trade we want to keep, so that it is the French and German industries that will keep their politicians in Brussels and elsewhere under control in this vital area?
Baroness Stowell of Beeston
The noble Lord is taking us into a stage which we are not currently at in asking about what we might want to negotiate, so that is something on which I cannot offer any detailed comment at this time.
I am very grateful to everybody, and I think we are about to move on to the next business.
Investigatory Powers Bill
(8 years, 5 months ago)
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Baroness Neville-Jones (Con)
My Lords, I return to the subject of the Investigatory Powers Bill. I support the Bill, which I believe to be strongly in the national interest. The threats against which we need this legal base for our collective protection are, sadly, of indefinite duration and, as other noble Lords have said, the situation is getting more complex, difficult and dangerous and we need the protection of the law behind us. Having said that, at the same time it is very welcome that the legislation will include further protections and safeguards that do not exist at present. That gives reassurance and helps produce the balance that we need in legislation for the future. Finally, it is important to remember that we need to get the Bill through as we have a statute on the books only until the end of the year.
The current Bill is the product of pre-legislative consultation and scrutiny in the other place, with plenty of debate and amendment. It has undoubtedly been improved for that. We should take notice of the fact that a great deal of work has been done there. It is, I think, well balanced and been made more proportionate in the course of that debate and a lot of progress has been made on contentious issues. While the House should give it the serious scrutiny that it deserves, which is one of our jobs, I hope that we can refrain from reopening issues where the other place has already done a good job. We do not need a degree of perfectionism that simply rewrites legislation in a slightly different way when the result we have already attained is good.
The Government have accepted an overarching statement of the privacy protections. That is very important and in the Bill. They have also either given or promised protections for sensitive data sources, Members of Parliament, journalistic sources, legally privileged materials and trade union activities. All of those add to the credibility of the Bill and clearly delineate where the powers apply and where exceptions have to be treated with great care.
There is also the increase in the double lock on forms of warrant, and I believe that any Home Secretary would be putting him or herself in considerable jeopardy were he or she to try to ignore the factual review of the judicial commissioner, so one really cannot argue that the power of the judicial commissioner that has already been put in place is inadequate.
My noble friend has indicated that more government amendments will be introduced as a result of debate in the other place, and our debates here will be made a good deal easier by that welcome development. We should pay tribute to the quality of debate in the other House that has led us to be able to advance the Bill in this House at an early stage.
Many noble Lords have rightly said that the Bill mostly brings together existing powers in one place, but there are some new ones, and one of them is access to internet connection records—so-called ICRs—including, as others have said, in relation to VoIP. The Government describe that power as crucial and I very strongly agree. It is necessary for us to have this technical capability. It is also an example of where previous legislation on the statute book was out of date because of technical developments. The point made by other noble Lords about the need to have legislation that enables us to deal with future technical development is important. Future-proofing is difficult; it is not easily done; but we should not pass legislation that prevents us coping with new situations. Taking a sensible stance on future-proofing is important.
I am sure that we will debate the ICR legislation carefully, and it is right that we should do so. There is the question of the authorisation regime and whether it is tight enough, and we need to know exactly what data can legitimately be regarded as forming an ICR. These are all issues that we need to look at. Among other things, service providers need to know precisely what they have to store. An important point is also to have clarity in the Bill itself over what constitutes third-party data.
I have had plenty of lobbying letters, as I am sure other noble Lords have, which raise some important issues that we will want to look at. Some of the points I have had have certainly been overegged, but in the letters I have had the service providers have generally taken a very intelligent and constructive interest in the Bill. Most of them say they welcome it, and very often they propose quite sensible ideas. Quite a lot of it focuses on whether it is right and adequate simply to have some of these safeguards spelt out in a code of practice or whether they should be in the Bill. In general I tend towards wanting to put the safeguards in the Bill.
I will say just a word about bulk powers. There is widespread questioning of why the British Government consider these powers so essential when other Governments do not think them necessary. We need to look at that carefully. My noble friend Lord King gave us some of the reasons why the Government may well be right. One does not have to believe in the erroneous assertion that collection of bulk material constitutes bulk surveillance—it does not. On the other hand, we need to be cautious about collecting a vast amount of data, which covers large numbers of individuals who are not necessarily involved. However, we do not live in a world where prior intelligence is so good that it is obvious that we can totally dispense with bulk collection in favour of targeted collection. The point is obvious. For me, the question is much more about how many categories of bulk collection are justified in the national interest. The Government have provided an operational case, and I look forward to the view and the assessment that Mr David Anderson will put forward in his forthcoming report, which will be very important to the House.
Finally, I will address something that has not been mentioned in the debate so far, which is the question of information that is outside the jurisdiction of the United Kingdom but which the agencies may need. It is quite possible—in fact, I would say that it was quite probable—that quite a lot of cases will involve data located outside the UK jurisdiction. Once the Bill has been agreed, it will give a considerable degree of confidence in UK standards of authorisation, transparency and oversight of data collection, and will lay a good base for international agreements with like-minded Governments, which would permit UK requests to be directly made to companies rather than through Governments in different jurisdictions. That will be an advance on having to rely on mutual legal assistance agreements. On this issue, I hope that we will build in the Bill a base for the international agreements that have been proposed by Sir Nigel Sheinwald as a way forward, as that will be a constructive and rapid way forward to getting the kind of information the agencies need. It is no good the agencies asking for something which turns up three months later after a legal haggle instead of being able to get at it in a timely way.
This is important legislation, and I hope that, notwithstanding the turbulence in our national politics that we have just been discussing, we will be able to apply ourselves and get it on to the statute book in good time.
Lord West of Spithead (Lab)
My Lords, I first congratulate the many people who have worked so hard to ensure that the Bill is nearly fit for purpose. Interception of communications and civil liberty are uncomfortable bedfellows but we are within a hair’s breadth of a sensible compromise. Indeed, I believe—unlike the noble Lord, Lord Strasburger—that this will be a benchmark for security legislation globally. Certainly, on talking with my old counterparts in a number of countries, I found that they also feel the same.
We live in a more dangerous world than at any time in my 50 years on the active list, notwithstanding the Cold War. It is more unstable and more dangerous. We must not forget that all the numerous terrorist plots thwarted in the UK over the last 10 years—the seven referred to by the noble Lord, Lord King, were only last year, and there were 10 while I was a Minister, so the number is a lot greater than that—were initially discovered by intercept. Intercept has kept our people safe. We clearly cannot allow terrorists, such as Daesh, serious organised crime syndicates, murderers, paedophiles and so on to exchange information, plan and operate, safe in the knowledge that law enforcement is unable to monitor or get at their activities.
I also hope—as was mentioned by the noble Lord, Lord Paddick, and the noble Lord, Lord King—that the politically loaded and seriously misleading phrase “snoopers’ charter” has been removed from our lexicon. I pay tribute to those of our security services and agencies who work tirelessly to protect our people. I have worked cheek by jowl with them over many years, and they are basically ordinary British men and women doing an extraordinary job. They are not some Stalinist or Gestapo group intent on oppressing our people. My only complaint is that too many of those at GCHQ are Guardian readers and seem to dress rather casually. Too many people in the civil liberties field see them as fascist bogeymen: they are not.
The lead-up to this Bill has been tortuous but it is needed urgently, and there was an overwhelming requirement to replace the outdated legislation and ensure the correct safeguards for our civil liberties.
What is absolutely clear is that the Bill is certainly not part of a “dangerously rushed parliamentary process”, which is what Amnesty International has said. It is the result of highly detailed scrutiny, over a very prolonged period—I suggest that it has taken longer than two years in its various guises. That was not least as a result, as was mentioned by the Minister, of the report by David Anderson, A Question of Trust; the detailed work of the Joint Committee on the Draft Investigatory Powers Bill; the independent surveillance review from RUSI; the ISC study; the work of the Science and Technology Committee; and so on.
The Bill has been pored over in the other place and the Government are to be congratulated on their willingness to accept so many necessary amendments. There are still a number of areas where the Government have promised changes, and we need to wait and see what they come up with. Those include, as has been mentioned, issues that relate to protecting journalists and source confidentiality, and, as the noble Lord, Lord Pannick, mentioned, lawyer-client confidentiality.
The web is transnational and knows no boundaries. Therefore, I ask the Minister whether we are moving towards a more predictable, transparent, usable and coherent legal framework for providers overseas, as was endorsed by David Anderson QC, the Independent Reviewer of Terrorism Legislation; by Sir Stanley Burnton, the Interception Commissioner; and by Nigel Sheinwald in the study that the Prime Minister asked him to do.
I also have concerns about clarity over compliance costs, where I believe businesses will be unable to make the necessary financial planning for storing internet connection records.
From all my experience in this area, I know that equipment interference is absolutely crucial to law enforcement and our security. We need to be very wary and very careful of constraining our agencies too much in this area.
I have concerns also about authorisation and the double lock in certain circumstances, particularly political issues to do with some sort of monitoring overseas. I will be interested to see how that develops over the next few months as we debate this.
Lastly, I know from personal experience how crucial to our people’s safety bulk collection is, primarily for terrorist purposes. I await David Anderson’s review of all bulk powers with great interest, but hope that he will not try to constrain that too much. It is not about prying on all those data; it is about getting the key little points that enable us to get after the people who wish to do us harm and kill us.
We still have a way to go, but I look forward to hearing the debate in this Chamber over the next few months. We have a lot of people who know a lot about these issues. My initial impression is that this is a timely, valuable and necessary piece of legislation, which gives us the powers we need. It is infinitely better than the flawed legislation that it is replacing.
Lord Lester of Herne Hill (LD)
I, too, like the noble Lord, Lord West of Spithead, and others, welcome this Bill as a significant step towards providing a much-needed clear and transparent basis for the investigatory powers used by the security and intelligence services and law enforcement authorities. I also welcome the safeguards that it contains, some of which need to be strengthened. We must await the expert assistance of David Anderson’s report on the key issue of bulk powers. David Anderson is about the last person left in this country that I really trust on some of these issues.
I am grateful for briefing from the Law Societies of all four corners of the UK, the Bar Council of England and Wales, the Chartered Institute of Legal Executives and the NGOs, Liberty and Justice. I shall talk mainly about legal professional privilege, an issue raised some years ago by my noble friend Lady Hamwee.
It is essential that there is a powerful independent body able to ensure that the vital powers of the state and its agents are not misused. David Anderson QC, the wise and manifestly independent reviewer of terrorism, wrote in his report, A Question of Trust:
“Trust in powerful institutions depends not only on those institutions behaving themselves (though that is an essential prerequisite), but on there being mechanisms to verify that they have done so. Such mechanisms are particularly challenging to achieve in the national security field, where potential conflicts between state power and civil liberties are acute, suspicion rife and yet information tightly rationed”.
The Government’s simplification of the oversight system in the Investigatory Powers Commission is welcome. The commission should have the resources needed to improve transparency, efficiency and public trust in the vital work of the security and intelligence services. The commission needs to be properly funded and have the services of an amicus on difficult warrant applications. It is in the interests of public trust and confidence that the judicial commissioners are appointed by the Prime Minister on the recommendation of an independent appointments committee established by the Commissioner for Public Appointments. I hope that the Minister, who, I am delighted to mention, is a member of my chambers, as is the noble Lord, Lord Pannick—it is a curious, triangular situation—will be able to reply positively to these suggestions.
I turn to legal professional privilege, which has been spoken about powerfully by the noble Lords, Lord Rosser, Lord Pannick and Lord Paddick. It is a constitutional right inherent in the rule of law, which protects the individual’s right to consult a legal adviser in absolute confidence, knowing there is no risk that information will become known to a third party without the client’s clear authority. It is the right to speak safely with a lawyer, and it has been protected by our common law—and I dare say in Scotland, too—since at least the 16th century.
The mere prospect of surveillance creates the risk of a chilling effect on openness of communications with a lawyer. The accuracy of legal advice is an immediate and obvious casualty, but so is the rule of law. Without being able to discuss candidly, defending lawyers might not know about important defences open to a client. Courts may adjudicate cases on a misleading or incomplete basis. When people cannot speak safely with their lawyers, it is not only individual privacy that is affected but the administration of justice as a whole.
There is a danger of miscarriages of justice for individuals in litigation with the state. The Government may respond that there will be no unfair advantage when they monitor individuals’ meetings with lawyers, because they can maintain a Chinese wall between spies and prosecutors. But that was not the finding of the Court of Appeal in 2011, when it struck down the convictions of 20 environmental protestors whose conversations with a lawyer had been monitored by an undercover police officer, Mark Kennedy. Nor was it the finding of the Investigatory Powers Tribunal in April last year, when it ordered GCHQ to destroy illegally intercepted communications between a Libyan rendition victim, Abdel Belhaj, and his lawyer. In mishandling those data, GCHQ rightly admitted that it had broken its own rules and had broken the law.
Prohibiting the targeting of legally privileged communications does not impair the ability to bring dishonest lawyers to justice. Legal privilege attaches only to communications between lawyer and client genuinely aimed at obtaining legal advice. If the consultation is a cover for a conversation whose true aim is to further a criminal purpose, it is not protected. The Bill should forbid deliberately targeting legally privileged communications.
This may be an unnecessary academic, technical point, but I still think it worth mentioning. Reference has been made to an iniquity exception, but it is more accurately described as a constraint on the scope of the privilege. For example, Section 10(2) of the Police and Criminal Evidence Act 1984 states:
“Items held with the intention of furthering a criminal purpose are not items subject to legal privilege”.
That, I think, is the correct approach.
When compelling evidence suggests that the privilege is being abused, a judicial commissioner should be required to authorise covert information-gathering. There should be no grant or modification of a warrant likely to capture privileged communication unless there is prior judicial approval. This protection is written into the Bill in respect of journalists’ sources—see Clause 73. Legal professional privilege needs equal protection. There is also a need for safeguards to ensure that any legally privileged communications intercepted accidentally or incidentally are immediately destroyed.
Like the Joint Committee on Human Rights, I recognise the value of thematic warrants, but the Bill’s provisions concerning the possible subject matter of targeted interception and targeted equipment interference warrants are too broadly drafted. As the JCHR recommends—and I agree with it—the Bill should be amended to circumscribe the possible subject matter of warrants in the way recommended by the Independent Reviewer of Terrorism Legislation. That will ensure that the description in the warrant is sufficiently specific to enable the person unknown, but who is the subject of it, to be identified and to prevent the possibility of large numbers of people being potentially within the scope of a vaguely worded warrant. One is reminded, for those who are interested in history, of the kind of Entick v Carrington problems that were raised in the 18th century.
The JCHR has said that,
“the power to make major modifications to warrants for targeted interception, without judicial approval, is so wide as to give rise to real concern that the requirement of judicial authorisation can be circumvented, thereby undermining that important safeguard against arbitrariness”.
I agree with the JCHR that major modifications to warrants should require approval by a judicial commissioner.
The independent reviewer has said that he knows of no other country in which the Secretary of State holds responsibility for authorising police warrants; judicial authorisation is sufficient. The Home Secretary signs some 1,600 warrants each year, not including national security warrants. If the requirement of her direct approval for police warrants were removed from the Bill, she would have 70% fewer warrants to approve, giving her more time to focus on vital national security interests. That makes good sense.
As I said at the outset, I welcome the Bill and hope that it will be significantly improved, as suggested by my noble friend Lord Paddick and others in the debate. I look forward to the Minister’s response.
Lord Butler of Brockwell (CB)
My Lords, it is a great pleasure to follow the noble Lord, Lord Lester of Herne Hill. It brings back the arguments we used to have about the powers of the intelligence agencies on dog walks around Brockwell Park—which, incidentally, is not my personal estate. He was then counsel in the Spycatcher case; I was about to be Cabinet Secretary. He did not trust me then and since he says now that David Anderson is the only person he does trust, that situation clearly has not changed.
When I last spoke in the House, on the Motion of the Leader of the Opposition about the powers of Parliament and of this House, I was critical of much of the legislation introduced into Parliament. I do not withdraw that but I do not make those criticisms of this Bill. On the contrary, like others who have spoken, I commend the way in which the Government have brought forward the Bill and the way in which it was debated and scrutinised in the other place.
The Government published a draft of this Bill in the autumn. Despite the fact that preparation of it had been informed by authoritative reports from the Independent Reviewer of Terrorism Legislation, the Intelligence and Security Committee of Parliament and RUSI, the Government produced it when it was, frankly, still in the course of preparation. It was just being baked. But that was a thoroughly good thing to do because it could then be considered by a joint pre-legislative committee—on which I had the privilege of serving, under the noble Lord, Lord Murphy—by the Intelligence and Security Committee and by the House of Commons Science and Technology Committee. That enabled a large number of changes to be made and improvements to be introduced before the Bill was brought before Parliament. At the same time, the Government undertook widespread consultation with interested parties outside Parliament, including the communications service providers, which were able to give evidence to the parliamentary committees. So there was a very transparent method of preparing this Bill, which was necessary in view of its complexity.
I have read in full the debates in Committee, on Report and at Third Reading in another place. Without being patronising, I think that they show the House of Commons at its best. There were no less than 16 Committee hearings. The Government responded constructively to the Opposition and, as has been said, introduced many amendments to respond to their points. As a result, it is remarkable that the Official Opposition did not vote against the Government in a single Division.
Of course, many matters were left over for this House, and I will come on to those, but I would also like to say—seeing as I am to be followed by the noble Marquess, Lord Lothian, who is a member of the Intelligence and Security Committee—that the scrutiny has shown the strength of the mechanisms that Parliament has for considering issues of this sort. In addition to the specialist committees that I have referred to, the Intelligence and Security Committee is able to operate within the ring of secrecy around these highly classified issues, and has shown itself capable of reassuring Parliament in some areas but also of proposing additional safeguards in other areas where oversight of the intelligence agencies needs reinforcement. That has been a very valuable contribution.
None the less, as others have said, there is much work for your Lordships’ House to do. There are important issues in the Bill that still need to be determined. Part of the Government’s response to criticisms raised in the other place was to promise further consideration in your Lordships’ House. That covered such important issues as protection of legal privilege, on which the noble Lord, Lord Lester of Herne Hill, and other noble Lords spoke; further protection of journalistic freedom; the definition of crimes for which access to communications data is justified; and the whole issue of the operational case for bulk powers. On top of that, although clearly the Home Office has made much progress in discussions with communications providers about the definition of internet connection records, questions remain about both the effectiveness of those and the cost of collecting them. We must remember that hanging over the whole issue is the case brought in the European court by David Davis MP and Tom Watson MP about the retention of communications data, in which there may well be further developments during the passage of the Bill.
The intention is that this House should start Committee before the Summer Recess but not complete it. That makes sense because by the end of the Recess we can expect to have David Anderson’s report on the operational case for bulk powers, which will be central to considering Parts 6 and 7 of the Bill. This is a very difficult but very important Bill. I hope that this House can maintain the very thorough but also very co-operative and constructive tone of the scrutiny that has taken place on it so far.
Lord Lester of Herne Hill
I apologise to the noble Lord and the whole House for the hurt I have caused him by suggesting that I trust David Anderson more than anybody else. I trust the noble Lord, Lord Butler of Brockwell, almost as much.
The Marquess of Lothian (Con)
My Lords, I am sure the whole House is relieved to hear of this new-found friendship between their two noble Lordships. It is always a pleasure to follow the noble Lord, Lord Butler of Brockwell. He and I served together on the Intelligence and Security Committee in the last Parliament.
I am particularly pleased to take part in this Second Reading debate today, not least because the ISC—on which, along with the noble Lord, Lord Janvrin, I have the honour to represent your Lordships’ House—has over the past three years published two reports on investigatory powers. At the end of the last Parliament, the Intelligence and Security Committee, including the noble Lords, Lord Butler of Brockwell and Lord Campbell of Pittenweem, produced a substantial report entitled Privacy and Security: A Modern and Transparent Legal Framework. It covered in detail the gamut of the intrusive powers available to our security and intelligence agencies, and concluded that existing legislation was “unnecessarily complicated”, outdated and lacked transparency. It needed to be replaced by a modern, transparent legal framework fit for the internet age. Since that report, as well as the ones mentioned by the noble Lord, Lord Butler of Brockwell, from the Independent Reviewer of Terrorism Legislation and RUSI, the Government introduced the draft Investigatory Powers Bill. This was the subject of the ISC’s second report, which made many specific recommendations towards improving the Bill, especially in those areas relating to certain investigatory powers where the legal authorisations were opaque and the safeguards, in our view, insufficient.
This Bill is a significant step forward in clarity, transparency and enhanced safeguards. For the first time, it provides an explicit statutory footing and authorisation procedure for bulk personal datasets, equipment interference and bulk acquisition of communications data. Where authorisations and procedures already existed under RIPA, these have now, thankfully, been set out more clearly in this Bill. They will also now, under the Bill, be subject to the additional protection of judicial commissioner approval.
I readily acknowledge that the Government have engaged constructively with the ISC throughout the passage of this Bill. Several of our recommendations on the draft Bill were incorporated during its passage in the other place. We have also, helpfully and reassuringly, been provided with additional classified evidence regarding other matters raised in our report, most notably on the use of bulk equipment interference and the need for economic well-being as a ground for interception.
On the crucial operational purposes, which regulate the examination of material collected using bulk powers, we suggested that there was insufficient detail in the Bill as to how they would be regulated and managed. The Government have now committed themselves to include further detail on this which I look forward to seeing during the following stages of the Bill.
On bulk personal datasets, the Government have confirmed that they will introduce amendments adding extra safeguards where these contain sensitive data. Already, following changes in the other place, there are now welcome restrictions on the use of powers to investigate legitimate trade union activities and greater restrictions on bulk personal datasets containing medical records. These are welcome.
However, we continue to press for additional restrictions on the use of these powers in relation to sensitive personal data. I hope that we will in due course see government amendments to implement these additional protections.
Turning to thematic interception and equipment interference warrants which concerned the noble Lord, Lord Lester of Herne Hill, they also concern us in that we feel they can be drawn very widely, potentially catching a large number of people in a single warrant. These concerns have still not been completely met by the Government but the Home Secretary has told my committee that she is considering what more can be done to provide further assurance about how these thematic warrants will operate. Again, we look forward to seeing that.
The ISC still has concerns about provisions for criminal offences in relation to the misuse of powers. The Bill refers to already existing offences apparently necessary to avoid a confusing overlap. However, for the misuse of certain powers, the only criminal offence would be misconduct in public office, which, in my view certainly and in the view of others, is an old common law offence which prosecutors are often reluctant to pursue. For other abuses, the only criminal penalties would be fines under the Data Protection Act and the Wireless Telegraphy Act, almost certainly not sufficient for the most egregious cases of misuse.
This Bill has been introduced to this House in clearly better shape than when it was originally published, and for that I congratulate the Government. However, there are further improvements which can and should be made, hopefully by government amendments at the forthcoming stages of the consideration of the Bill.
At stake is the difficult balance between an individual’s right to privacy and society’s need for national security. There will, I fear, never be total consensus on that balance. While the ISC has consistently concluded that the agencies’ operational techniques are justified, we have equally been insistent on the right constraints being placed on their use. I hope that with the further revision to the Bill which will take place in this House, we will get these constraints right, without undermining the agencies’ vital work to keep us safe. That is the balance we seek to achieve. This Bill has the potential to achieve it.
Lord Murphy of Torfaen (Lab)
My Lords, it is a pleasure to follow the noble Marquess. His political path and mine have crossed on a number of occasions over the years, particularly when I had the great privilege of chairing the ISC, of which he was then a member—and still is, of course.
A number of noble Lords have said during the course of the debate—and will continue so to say—that we live in a much more dangerous world, that technologies have developed enormously over the last number of years and, of course, that the security services need new tools to deal with the new world. I pay tribute to the security services in all that they do.
Another theme that has emerged over the last number of hours, and will continue so to do, is the balance that we must have between, on the one hand, the security of the country and, on the other hand, the liberty of the citizen. Certainly I recall, when I was the Northern Ireland Secretary, that every time I had to sign a warrant for intercept—I had to do so many times—I realised that I was depriving someone of their liberty. Sometimes they needed to be deprived of their liberty, but it was in my mind all the time that I was doing a serious thing.
It is certainly the case that since the draft Bill, as it then was, was introduced in November of last year there have been a great number of changes to it. As chairman of the Joint Committee of both Houses on the Bill, I pay tribute to those Members of this House—some of whom have already spoken and some of whom will be speaking in this debate—and the other place who took part in the deliberations of the Joint Committee. I also pay tribute to Mr Duncan Sagar and his parliamentary team, who were absolutely first class in the advice that they gave us, and to the two special advisers, Martin Hoskins and Professor Peter Sommer.
It has been mentioned that some people think the Bill did not receive or is not receiving sufficient scrutiny. I reject that. The Joint Committee worked for over two and a half months, sometimes meeting three times a week. We received 1,500 pages of written evidence and interviewed 59 witnesses. At the end of all that, the committee made 87 specific recommendations to government to improve the draft Bill, the vast number of which were agreed by the Government. The recommendations included the need for codes of practice on internet connection records, on equipment interference and on bulk personal databases; a further role for the ISC; urgent warrants to be reviewed not after five but after two days; the need for the Government to justify bulk powers; and, perhaps most interestingly, that at the end of five years both Houses of Parliament would review how the legislation has worked.
After scrutiny by the Joint Committee the Bill went to the other place, and my noble friend Lord Rosser and others mentioned the changes that were made to it in the House of Commons. When I started my life as a politician a million years ago, changes to Bills were very rare. One would go to a standing committee for up to three months and it was likely one or two amendments would be accepted. I am glad to say that the Government have not taken that attitude with regard to this Bill. I pay tribute to Sir Keir Starmer, who led for the Opposition in the House of Commons, and to Mr John Hayes, the Minister for Security, both of whom worked well together in the House of Commons both in Committee and on Report.
There were substantial changes made to the Bill, as we have already heard, on issues such as legitimate trade union activities, access to medical records, how privacy should be built into the Bill as a substantial issue, and the independent review into bulk powers under David Anderson QC. All those necessary changes were made on the Floor of the House of Commons or in Committee as a consequence of both Front Benches sensibly talking to each other.
Now, further work has to be done. I think that your Lordships’ House is the place where detailed scrutiny can take place because of the expertise, the experience and the background of many of your Lordships who are not only speaking today but undoubtedly will speak in Committee and at other stages of the Bill.
We still need to look at some issues. The professions have been mentioned already by a number of your Lordships, with reference made to lawyers and to journalists. There is still work to be done on that. We look forward to David Anderson’s review, because that will give this House the opportunity to see what he says and to look further into the question of warrants. Thematic warrants, referred to by the noble Marquess, are important, too.
So there is plenty of work to be done on the Bill, but it is a Bill that is necessary for the security of our people. It needs to strike that essential balance between the liberty of the citizen and the security of the country. It is a much better Bill today than when it was introduced in November last year and I look forward to taking part in the deliberations before and after the Recess.
Lord Campbell of Pittenweem (LD)
My Lords, one of the most well-worm clichés in politics is that the devil is in the detail. On this occasion, I venture to suggest that it is more than apposite, because I cannot remember legislation in my time either in the other place or here which contained so many detailed provisions. I have the misfortune to disagree with several of my noble friends on these details, but I happen to believe that the fundamental principles which underlie the Bill—of necessity, proportionality and legality—are ones that the whole House would readily accept.
I was struck by a statement made by the Home Secretary at Third Reading in the other place. She said—and I paraphrase slightly—that the duty of government is to protect its citizens and the duty of Parliament is to hold the Government to account for the way in which they exercise that protection. These cannot be absolute values; they are essentially relative. The extent to which one may be emphasised at the expense of the other will always be a decision of fine judgment. It will always be a decision which has to be taken in prevailing circumstances. The kind of legislation introduced in the United Kingdom Parliament in either the First or the Second World War reflected what was thought to be of particular urgency, but we must be clear that what may be proportionate or necessary at one time may not be proportionate or necessary at another.
It is well accepted that the Bill must provide a proper framework with which the judgments to which I have referred can be made, but I thought that the noble Lord, Lord King, who is no longer in his place, made a very sound point about the pace of change. One difficulty about the pace of change is that it is not constant but is always accelerating. When we consider that the iPhone, or rather—I had better be careful that I do not advertise—the mobile phone that we all carry in our pockets now contains a capacity far beyond that of the computers that used to occupy a whole room in the 1960s, it illustrates just how much capability has improved and been changed, and the extent therefore to which legislation has, so far as possible, to keep pace with it.
I am persuaded that this Bill generally provides a proper framework—but, as we have already heard, more amendments have to be made. In the other place, the willingness of both sides of the House to enter into dialogue and discussion helped to produce a Bill which is perhaps not as divisive as it might have been, but has none the less left for your Lordships a variety of issues of importance which will be aired for the first time only during consideration in Committee.
On the double lock, it is still argued by some that approval should be by judge alone. With that conclusion, I respectfully disagree. Parallels with other jurisdictions are dangerous. Sometimes reference is made to what happens in the United States, but it is important to remember that judges in the United States are elected or appointed not just because of their legal ability but because of their political affiliation. That is true in the Supreme Court—hence the controversy which surrounds the choice that Barack Obama may have about the appointment to a vacancy on the Supreme Court Bench.
I am thoroughly convinced that judicial review, or the application of its principles, is more than appropriate. Judicial review is a well-established process both in the common law and in the law of Scotland. Judges are well used to applying its principles and the law, as the Advocate-General will certainly be aware, has developed considerably since the case which gave rise to the Wednesbury principle was decided many generations ago.
My belief that the initiation of approval should rest with the Home Secretary seems entirely justified because there will be occasions when the mere granting of a warrant will have political implications. That may be so particularly if there is any question of activity authorised by a warrant taking place abroad. In those situations, the decision being of a political nature, I feel that no judge would be enthusiastic about the proposition that they and they alone should have responsibility for these matters—it would be entirely inimical to the approach that judges take in our system.
I understand the motive behind the amendment made in the other place which provides that the judicial commissioner has to take particular care to apply the general provisions on privacy which are now a centrepiece of the Bill. I suspect that that is an unnecessary belt when there were already adequate braces, because I cannot imagine any judicial commissioner worth his or her salt who would not, in interpreting a particular section of the Act, take account of all the rest of the terms of the Act—indeed, it is a fundamental principle of statutory interpretation.
As I have said already, the Government have shown remarkable willingness to accept and adopt proposals for amendments, particularly in relation to the activities of journalists and the relationship between lawyers and their clients.
I will finish by saying a word about bulk powers, which have been and remain controversial. I began by thinking that the jury was out, but it would be more correct to say that the independent reviewer, David Anderson, is out and we will have to wait for his report—but I think that there is confidence on all sides of the House in his ability to bring proper forensic application to these issues and to provide a report which will be of great assistance.
The powers that we are talking about already exist; they are not new powers. David Anderson’s review will provide a safeguard as to whether it is appropriate to continue with them, but, rather as the chairman of the ISC, Dominic Grieve, said in the other place, there is strong and general acceptance that the powers are necessary and proportionate. Without straining the metaphor too much, people say that it is like looking for a needle in a haystack, but you must first have access to the haystack before you have any opportunity of looking for the needle. I commend the Bill.
Lord Janvrin (CB)
My Lords, as the noble Marquess, Lord Lothian, has mentioned, I am a member of the Intelligence and Security Committee. It is slightly daunting to follow four very senior members, either past or present, of that committee as I am a relative newcomer. I join them and other noble Lords, many of whom have direct experience of intelligence, security and law enforcement matters, in welcoming the Bill before us. It covers ground that is of real and utmost importance in terms of national security and the prevention of serious crime while touching on crucial issues of personal privacy in a digital context, which has been referred to many times; it is not only complex, but very fast-moving. We are also up against a deadline set by the sunset clause in the RIPA Act 2004.
I join others who have spoken, including in particular the noble Lord, Lord Butler, in acknowledging the vast amount of work orchestrated by the Government that has gone into the preparation of the Bill before us. It has been the subject of numerous reports, to which a number of speakers have referred, including two from the Intelligence and Security Committee. This work has led to the Bill now progressing through Parliament with intensive scrutiny, as was referred to in the other place. There is one further external review being done by David Anderson QC of the operational case for the intelligence agencies to have access to bulk investigatory powers. In the last Parliament the ISC considered bulk interception in great detail and was satisfied that that capability was justified, subject to robust safeguards and oversight. Furthermore the current ISC, again after considering a great deal of classified evidence on this subject, reached a similar conclusion for bulk equipment interference, the bulk acquisition of communications data and bulk personal datasets. I look forward to David Anderson’s review as an invaluable contribution to further consideration of these bulk powers by this House.
Your Lordships will be aware that a significant number of improvements have been made to the Bill in the other place, including extra safeguards, improved oversight mechanisms and stronger privacy protections. A number of these improvements were made on the recommendation of the ISC and we are extremely grateful for the co-operation shown and helpful approach taken by the Government throughout. That said, as the noble Marquess, Lord Lothian, mentioned, there are still a few aspects of the Bill on which my ISC colleagues have concerns or questions, and I should like to reinforce two of those, both of which have already been mentioned.
The first is the issue of restrictions on the use of class warrants for the retention and examination of the most sensitive personal information within bulk personal datasets. Noble Lords will be aware that the ISC tabled amendments in the Commons that would have restricted this power where a significant amount of the data would be sensitive. We looked to the Data Protection Act 1998 to determine what Parliament had already defined as being the most sensitive personal data. It is the use of generic class warrants in relation to that sensitive data that we have questioned. Our understanding is that the Government have accepted that in principle, but it would be interesting if the Minister could indicate whether he intends to bring forward amendments on this point in Committee.
The second aspect has already been referred to by the noble Marquess, Lord Lothian. It refers to offences for the misuse of investigatory powers contained in the Bill which are scattered throughout various pieces of legislation and common law. While in some cases there are severe penalties for abusing those powers, in other cases, as has been mentioned, the penalty can be described as little more than a reprimand or a moderate fine. Such penalties may be suitable for dealing with honest mistakes or more minor instances of negligence, but there may be a point where the malicious and wilful abuse of intrusive powers could be dealt with more consistently with the use of more severe criminal penalties than are currently available.
Finally, I shall raise a point referred to by the noble Baroness, Lady Neville-Jones, and the noble Lord, Lord West. It is some 18 months after the ISC’s Report on the Intelligence Relating to the Murder of Fusilier Lee Rigby, but it still seems unclear whether the extraterritorial nature of warrants asserted by the Bill will be honoured by communications companies based overseas. The ISC recommended in the Fusilier Lee Rigby report that access to communications held by overseas-based providers, particularly those in the United States, was a very significant security problem, so I would be grateful if the Minister could comment on the progress of negotiations on that matter, in particular with the Government of the United States.
As your Lordships scrutinise the Bill over the coming weeks, whatever views may be expressed regarding its specific provisions, we should not lose sight of what this new Bill as a whole achieves, as many speakers have already mentioned. In particular it makes significant improvements in terms of transparency by avowing certain intrusive powers for the first time, including equipment interference, bulk acquisition and bulk personal datasets. While the use of those powers previously was legal, they were shrouded in secrecy and obscured behind some fairly impenetrable legal language. Having these powers set out on the face of the Bill is a considerable improvement. We should also welcome the role of the judicial commissioners as an extremely significant safeguard, and while we may debate the detail of their role, once again I urge noble Lords to acknowledge this very welcome additional reassurance.
Based on the recommendations of the ISC, David Anderson and RUSI among others, the Government have recognised the need for a new, modern and transparent legal framework for this crucial and complex area. The Bill is a huge improvement on the legislation it will replace. I look forward to further discussions in your Lordships’ House as we scrutinise it in the weeks to come.
Baroness Liddell of Coatdyke (Lab)
My Lords, I draw attention to my entry in the register of interests. Perhaps I may join other noble Lords in welcoming the legislation and take up the point just made by the noble Lord, Lord Janvrin. We now have a much more modern piece of legislation and a more transparent one that will allow law enforcement agencies, security agencies and the judiciary to look more coherently at the necessary activities of safeguarding the well-being of citizens.
I listened with interest to the noble Lord, Lord Strasburger, but I have to say that the greatest human and civil right of all is the right to life. The biggest problem we face at the moment was drawn to our attention by the noble Earl, Lord Howe, at the beginning of the debate when he referred to the fact that we are having to deal with increasingly capable international actors who are prosecuting terrorism against not only us but internationally as well. My noble friend Lord Blunkett also referred to the fact that the cyberthreat is the greatest threat we face at the moment, not least because it is so very difficult to police—it can take place not just in the boondocks of Syria but in the back streets of Glasgow, London and Manchester as well. We need the protection that this kind of legislation can give us. Yes, it has had a very deep scrutiny, and not just in the other place. I do not remember a piece of legislation that has gone through so many iterations, with different committees of this House and elsewhere. That, in itself, is a very significant check and balance on the powers contained in the Bill.
I do not expect the Minister to provide it this evening, but as we go into Committee there are some areas where we need greater clarification. Sir Nigel Sheinwald, for example, looked at the international implication of parts of the legislation and it seems that only one of the powers has come up in terms of his conclusions in relation to international scrutiny. I may have misread this, but I would welcome clarification from the Minister about how we ensure that this legislation is internationally compliant and that, with our allies, we are able to work within a framework of legislation that does not hinder anyone; it will increasingly be in that area that we will need to share information, not least because of the events of last week. It would be very useful to have some detail on what evidence there is of how compliant this legislation would be with EU regulation; we have to be able to convince people who are no longer our partners of the request for information and for action that will be contained within the powers in the Bill.
I said that we are dealing with increasingly capable international actors. We are also dealing, as noble Lords have mentioned, with an extremely rapidly growing technological capability, both legal and illegal. I would welcome some reassurance from the Minister on the flexibility that is contained within the Bill to enable a response to changing international circumstances and changing technology. The one thing many of us have learned from the most recent cyberthreat is that the threat quite often comes not from organised entities but from clever individuals, some of whom are still at school but who can pose a cyberthreat. It is very important that we have the flexibility and capability to deal with that.
Another area that has been referred to, not least by the noble Lord, Lord Campbell of Pittenweem, is the protection of privilege. We heard a very eloquent speech by the noble Lord, Lord Pannick, about legal professional privilege. The area of Members of Parliament is a significant one but there is also the area of journalists. In the old days it used to be quite easy to define who a journalist was, not least because they would have to carry a National Union of Journalists card—I speak as an ex-journalist. However, nowadays many people portray themselves as journalists because they write a blog that maybe 10 people read. We need to deal with the issue of the protection of sources, because serious journalists get serious information from sources. Journalists themselves have to do a degree of policing, because there has been irresponsible behaviour by journalists in the past and the profession must raise standards. But we will cease to have the kind of free press that is important to our society if we are not in a position to give a guarantee of protection of sources to journalists in appropriate circumstances.
I am very much looking forward to the detail of the rest of the Bill. The issue of bulk powers is a fascinating one. I am no expert; I am neither a lawyer nor a member of the Intelligence and Security Committee. I, like everybody else, am concerned about my personal privacy. I am sure that noble Lords are much too exalted to spend their time shopping online, but I do, and Google and Amazon know more about me than my husband does. We sacrifice our privacy every day. Agencies outside the security services are collecting our data and we turn a blind eye to it. This is a means of collecting data that can save people’s lives, not just help them to get a nicer pair of shoes. It is important that we recognise the importance of it and balance it against the need for privacy.
I congratulate the Government on bringing the Bill before the House. It is a modern take on legislation that in the past has lacked transparency and been complex, and I look forward to its early passage on to the statute book.
Lord Hennessy of Nympsfield (CB)
My Lords, I declare my membership of the Royal United Services Institute’s independent surveillance review, whose report A Democratic Licence to Operate was published last year. Open societies possess huge, enduring and, we hope, ultimately prevailing advantages over closed ones, yet open societies throw up special torments of their own—what one might call duelling desirables. This Bill lies classically in that territory, because it attempts to reconcile two duties to protect; the protection of our people from those who wish them and their institutions harm, and the protection of our people against state power, which involves a loss of liberty that trenches on the private conduct of their lives. John Stuart Mill caught this perpetual dilemma in the mid-19th century in his celebrated work On Liberty, when he wrote,
“the sole end for which mankind are warranted, individually or collectively, in interfering with the liberty of action of any of their number, is self-protection”.
More recently, my colleague on the RUSI review, Sir David Omand, said:
“Without security you cannot protect human rights”,
a point made by other noble Lords during the course of this debate.
There is a third element; the technical race between the protectors and the would-be harmers, the collection of pre-emptive intelligence which, in its modern form, has been with us since the early months of the Great War. I have with me a copy of the single-page, handwritten minute penned by the First Lord of the Admiralty, Winston Churchill, and countersigned by Jackie Fisher, the First Sea Lord, on 8 November 1914, instructing that all the decoded signals intercepts of the Imperial German Navy, current and past, should be kept in a locked box, in Churchill’s words,
“in order to penetrate the German mind”.
To this day, GCHQ regards this little slip of paper as its founding document, which led, in both world wars, to a British signals intelligence capacity on an industrial scale which was crucial to the outcomes to both conflicts.
I am, of course, aware that total wars create different conditions from the spectrum of state and the multiplicity of non-state threats we face today in our own age of anxiety. The RUSI panel was acutely aware of this and of the prospect of leaping technologies, to which I referred a moment ago. As a result, we came up with 10 tests, some of which the noble Lord, Lord Paddick, mentioned earlier, which should be applied in open societies whenever the John Stuart Mill dilemma presents itself anew. I deeply hope that the Minister will be able to accept those 10 tests this evening on behalf of the Government. They are, very briefly, as follows. The first is:
“Rule of law: All intrusion into privacy must be in accordance with law through processes that can be meaningfully assessed against clear and open legislation, and only for purposes laid down by law”.
That is our business this evening. Secondly, there is necessity and, thirdly, proportionality. Fourthly:
“Restraint: It should never become routine for the state to intrude into the lives”,
of the Queen’s subjects. The state must always and everywhere be a reluctant intruder. Fifthly, there must be effective oversight, with arrangements for the independent investigation of complaints. Sixthly, there must be a “recognition of necessary secrecy”. The secret state should be treated as a needed protector of the open society:
“It cannot be more than minimally transparent”,
to be effective, but it must be accountable to Parliament. Seventhly, the necessary secrecy, however, must be kept to the absolute minimum. Eighthly, transparency: how the law applies to the citizen must be clear and comprehensible. Ninthly, this presupposes legislative clarity, which, of course, is part of our job. Finally, UK Government policy on intrusion should as far as possible be “harmonised” with that of other “like-minded” open societies.
In my judgment, the Bill genuinely seeks to meet those tests, but I shall be listening very carefully to the arguments, especially on legal professional privilege. I take very seriously what other noble Lords have said, and what the Law Society and other liberty and justice-related bodies have said about the crucial ability of individuals to consult their legal advisers in confidence. As a former journalist, I shall take an interest in the degree to which journalists and the confidentiality of their sources are drawn into the Bill.
When I was operational, in the old days of the very old technology—just telephone tapping and a leak inquiry—I used to quite enjoy it, as long as I knew there was a leak inquiry, which I often did. I would plug the phone in on Whit Mondays to “Dial-A-Recipe” or the Test score, just to throw them off the scent. It was a trivial, adolescent thing to do, but those were the days of simplicity, when such things were possible.
The secret parts of the state and the law enforcement agencies wish for and need a new licence to operate in a world of shifting perils and surging technologies. Let us craft one that reconciles as closely as any Parliament can the two duties to protect with which an open society must always wrestle, because only Parliament can set the dials for the work of our secret services.
Baroness Harding of Winscombe (Con)
My Lords, it is humbling to follow so many noble Lords this evening who, if it is not too back-handed a compliment to say it these days, are such experts in this subject. Let me declare my more prosaic interest as the chief executive of TalkTalk, the communications service provider.
Debating the balance between liberty and security is not new. What has changed is the methods people use to threaten our security and to express their freedom. It will not come as a surprise to hear that I think that the internet is a wonderful tool, but just as it can accentuate what is good about the world, it can also accentuate the bad. There is a growing body of psychological evidence that the internet amplifies human behaviour. People shout online in a way they would never do to someone’s face, and the internet can connect criminals globally in a way that would be inconceivable in the physical world. The internet did not invent child abuse, terrorism or organised crime, but left unchecked it does allow those crimes to be committed on a much grander scale. Any child abuse is clearly horrific, but the internet takes those crimes to a global audience and allows those criminals to monetise it globally.
We know that ungoverned spaces in the physical world become havens for criminality. The same is true online. I am passionate about the opportunity the digital world can bring for this country—even more so after the events of the last week or so. I see the opportunity for Britain to be a brilliant digital nation, but we need a civilised digital world where the rule of law is clearly established by Parliament, where our law enforcement agencies have clearly articulated powers to act in the digital space, and where there is robust and transparent monitoring of those agencies by the judiciary and Parliament. That is why I am pleased to support the Bill and to play a part in what is clearly a very important debate.
As my noble friend the Minister said, the vast majority of the Bill covers powers that already exist under various disparate Bills. As DRIPA expires, the Government are right to take the opportunity to consolidate those powers into a single Bill, creating simplicity and the very transparency that is one of the ways to ensure that we maintain the right balance between freedom and security.
As a number of noble Lords have said, the Bill also needs to keep pace with technological changes, and I would like to focus my remarks on the most significant new power in it: the use of internet connection records. Whereas once, criminals communicated by phone, like everyone else they are increasingly moving online. For criminals—in fact, for all of us—the boundaries between the digital and the physical world are very porous, but our current legal framework still treats them very differently. Knowing what website someone visits is just the modern equivalent of knowing who they called. Knowing what IP address they are using, I would argue, is very similar to knowing which phone line they are calling from. Yet at present, we create a false legal distinction that artificially handicaps law enforcement agencies by denying them digital powers equivalent to those they have in the voice telephony world.
From my experience, it is right that police can access communications data. In just the first six months of 2016, nearly three-quarters—72%—of National Crime Agency comms data applications to TalkTalk related to child sexual exploitation. But child abusers definitely do not just use their phones to make calls. The next biggest category, 16%, concerned threats to life. How many of these cases would be resolved, how many lives saved, by extending access to internet connection records as opposed to voice calls only? That is why I welcome the inclusion of internet connection records, and why I believe that access to them is proportionate in a digital world. That does not mean, however, that we should just wave this legislation through. The digital world amplifies all behaviour, good and bad, so it is undoubtedly important that we scrutinise very carefully how these new powers can be used and their use monitored.
I will not even attempt to opine on the legal checks and balances proposed in this legislation. I am not a lawyer—I run a business—and I bow to the considerable legal expertise in this House and the other place on how best to ensure sufficient oversight, so that the various agencies that could access this data do so only when appropriate, and to ensure that individual freedom to roam the internet legally is well protected. But as the great legal minds in this Chamber begin that debate, I would like to add a little practical context on both the feasibility and the associated costs of storing and using internet connection records.
In principle, it is feasible for communication service providers to store internet connection records. It is, however, a non-trivial task, and the Government will have to work closely with them for some time to ensure it is achieved in a proportionate, practical and cost-effective way. Different businesses’ networks are configured in different ways, so the flexibility the Bill allows for different approaches is a practical and pragmatic way forward. The combination of obligations on the Home Office to consider the practical implications and costs on businesses before issuing a data retention notice, including the new privacy clause that places an obligation to consider the security of data storage systems, sets out clear safeguards that prevent this legislation being implemented in a way that is unreasonable for businesses, or that places unachievable obligations on industry.
A number of domestic communication service providers, including my own, have questioned the Home Office’s cost estimates. While I think it is fair to say that concerns remain about these estimates, I was reassured by the clear commitment from the Home Office that its figures are an estimate based on its expected implementation and do not in any way represent a cap or a budget. The Home Secretary was explicit in the other place that government would cover the costs incurred in the industry, and colleagues of mine across the sector will hope that my noble friend the Minister can reiterate that today.
Let me be clear: there is more work to do. The Government need to work closely with all providers likely to be affected by the legislation in order to understand what these obligations may look like for each provider and how much they will cost. But this is to be expected with new obligations, and the Bill as drafted provides the industry with the right safeguards that businesses need.
This is a hugely important debate. The moral, legal and social scaffolding for the digital world does not yet fully exist. I am a firm believer that the UK is better placed than any nation in the world to take advantage of the digital revolution and, just as we did with the Industrial Revolution, we need to ensure that the digital world is a civilised world where there is the rule of law; where Parliament has set out how we as a society balance individual freedom with security; where we do not tolerate unpoliced no-go areas; and where British liberal democracy flourishes.
I believe that this is an important Bill that helps us in that journey, a Bill that gives the UK the legal framework needed to protect our citizens without infringing on the innovation and creativity that we love about the online world. I am pleased to support it.
Lord Rooker
My Lords, it is clear that technological developments have greatly enhanced the capacity of Governments, companies and citizens to know more about individuals and undertake surveillance, interception and data collection. As such, the internet has become the front line in the contemporary debate about privacy and security. Such developments, though, as many have said, have created new avenues for serious crime by individuals, gangs and nations on an international basis. This Bill is part of our—I stress “our”—attempt to square the circle between the needs of security and privacy. It is a Bill I welcome and support.
I served on the RUSI Independent Surveillance Review. Our report, A Democratic Licence to Operate, showed that we need not abandon the values that are most important to us as citizens in order to protect our society. Current legislation providing the basis for the interception of communications is less than 20 years old, but it predates Google, Facebook and Twitter, so we are right to refresh and update the tools of the state. The threat is clear. First, international organised crime knows no boundaries. Secondly, information and communications technology spans borders, but Governments must be able to protect their sovereign territory. We have to meet a challenge: in an open society the secret part of the state has to remain secret to protect the openness, but it has to be regulated. The state should always be reluctant to invade the privacy of its citizens, and those who do this vital work should do so with a feeling of unease.
The RUSI panel set out the 10 tests, which I shall come to—I will not repeat what the noble Lord, Lord Hennessy, said—which legislation and government should meet. First, I will refer to the private sector. Google, Facebook, Microsoft, Twitter and other internet companies continue to lobby on this Bill. They could never have started up their commercial, profit-making businesses in autocratic societies such as Russia, Iran or China, to name just three. Our open, democratic system, based on the rule of law, which enabled them to start up and operate, is under threat. As such, they should not demand no-go areas for regulated law enforcement officers who seek out serious organised criminals. Law-enforcement agencies should never be in the position of not being able to seek, or ask about, information. This is not the same as having a back door into the servers of companies.
I sincerely hope that as the Bill proceeds—we have a way to go yet—we will explain that we do not conduct mass surveillance in the UK. Indeed, it is not done in the USA. Collection of bulk data, most of which are never even read, does not constitute mass surveillance. In general, I prefer Ministers to be involved in the warrants that are required for interception and surveillance. There is a degree of accountability that I think is an important aspect. But I do appreciate that this is not enough. There has to be a judicial role and oversight has to be strengthened. Indeed, I would want to be convinced that we have oversight of the oversight. We must always ask, “Who watches the watchers?”. The Bill attempts to do this. I note that the Government will bring forward amendments that were promised following the debates in the Commons.
It is amazing what is already being done but is never reported. Among our evidence sessions the RUSI panel held a round table with the Information Commissioner, the Intelligence Services Commissioner, the Interception of Communications Commissioner, the Surveillance Commissioner and the Chief Surveillance Inspector. I do not think that any of their published reports make the bestseller lists but they are there for us—parliamentarians and Select Committees—to read and question. That is absolutely crucial.
Unfortunately, however, in the past some public authorities have used powers which many believe they should not even have had access to. When RIPA 2000 went through, nobody raised the prospect of local authorities using it in respect of rubbish collection or access to school places. That has been stopped but it gave the whole thing a very bad, nasty taste. The powers in the Bill should be limited to the most serious issues affecting our society, with very strict rules about the process to be used.
Let us not beat about the bush or sugar-coat the issue: the Bill is about intrusion into privacy. The public have to be convinced that all the actions are legal and are the right actions to take on behalf of the public. This is not easy when some aspects must remain secret. The RUSI panel declared the 10 tests which Parliament, government and the public should apply when considering the conditions under which the police and intelligence and security agencies can intrude upon the privacy of the citizen. They are set out on pages 104 and 105 of our report. The noble Lord, Lord Hennessy, listed the 10 tests. Between now and Committee, will the Minister provide a very short paper on how the Government think that the Bill meets the 10 tests? That will save a lot of time in Committee, because otherwise we will have debates for hours. They are legitimate tests to which the Government should respond. The panel spent a lot of time working on this issue. Such a response would not be too difficult and would considerably ease the Bill’s passage.
The Bill itself is a democratic licence from Parliament to government. The report’s title is correct: it is a licence to intrude but it is a democratic licence based on regulation and oversight. The Government’s role is to protect the nation, its citizens, our way of life and the values we live by. Our tolerance must not be abused by intolerance that seeks our destruction. We have to be careful that we do not allow our tolerance to lead to our own destruction. But, as the RUSI report shows, and as was backed up by other reports, we can maintain the values that are most important to us as citizens in order to protect our society. This Bill makes a very important contribution to this aim.
Lord Macdonald of River Glaven (LD)
My Lords, I start by acknowledging the value of the work of our security services and its contribution to the security, prosperity and maintenance of freedom in our country.
During the five years that I worked closely with them, I found the security services to be well led by men and women who were clearly sensitive to the need to find an appropriate balance between security and liberty and thought deeply about these issues. In particular, I acknowledge the work of GCHQ, which is likely to be more impacted than most by this Bill. It is an extraordinarily important national asset and extremely well led by its director Robert Hannigan. He and his senior team seem sensitive to public concern and eager to find a legal framework that wins public confidence for their work.
I believe that it was a mistake for the Government to connive at a situation where some security programmes, such as Operation Tempora, the GCHQ programme, stretched the legal authorisation scheme then in force under RIPA to breaking point. So I welcome this present Bill as a serious attempt to create a framework of law in which the security services can do what is necessary to protect us, but within the context of a respect for civil liberties that is appropriately robust.
I want to address three areas. First, noble Lords have already spoken about future-proofing. This was a growing problem with RIPA. The speed of technological advance is quite extraordinary. The provisions that will be debated in detail by your Lordships’ House need to stand the test of time into at least the medium term, and should be judged against their capacity to do that.
Secondly, I encourage noble Lords to be realistic about the capacity of internet connection records to lay bare the most intimate details of a person’s life. This is not like telephone data; wholesale retention for 12 months means allowing access to more than raw data. It allows access to people’s lifestyles, beliefs, sexual practices, health and perfectly legal secrets. So we should consider this part of the Bill with that reality closely in mind. For my part, having seen the importance of communications data to serious criminal prosecutions—almost every serious criminal prosecution that was brought when I was chief prosecutor relied on data of this sort—I am inclined to support the clauses which refer to internet connection data. However, in debating these matters, we should recognise the significant concern outside Parliament in so far as this part of the Bill is concerned.
Thirdly, I will deal with protections against abuse. Foremost among these are the judicial commissioners. As someone who has been calling for a judicial role in the area of security practice for very many years, I strongly welcome the proposals in the Bill for judicial commissioners. There is a question as to whether they should be operating a judicial review test or a merit-based one. Some, including the noble Lord, Lord Campbell, say that it is for a politician to judge the merits and that a Secretary of State should be overturned only if his or her authorisation is irrational or unlawful. Others argue that a judicial confirmation of the merits would be an important protection against political abuse of these highly intrusive powers. I am inclined to agree, subject to debate, that security decisions are for the Minister and the lawfulness of the process is for a judge.
In making my final point about the judicial commissioners, I make clear that I yield to no one in my admiration for our retired judges. But it is very important that the judicial commissioners have, within their number, a majority who are active judges, adjudicating routinely, with full public confidence, in other areas of the law at the highest levels. This would encourage and underline a public view that the commissioners are independent and worthy of public confidence in their work. Let us have as many senior, working judges as possible among the judicial commissioners. In that way, we will avoid any hint or suggestion—however undeserved—that they are a club that can be won over by one side or another. Public confidence in the process of authorisation can only be enhanced if we ensure a majority of working judges within that important body of people.
Lord Birt (CB)
My Lords, like the noble Baroness, Lady Harding, I shall focus on crime rather than security. I support the Bill because it will reduce the number of victims of crime. Evidence of location obtained from use of a mobile device can be vital in a rape case, in domestic violence, or where, say, an older man has absconded with a young girl. These are all real examples. The powers defined in the Bill are limited, targeted and proportionate, and the safeguards convincing. However, while welcoming the Bill, I wish only that it went further.
It is a commonplace now to assert that crime is reducing, but I strongly suspect that it is not. Rather, crime is migrating from the physical to the digital world where it mostly remains unrecorded and undetected. The internet offers enormous advantages to the organised, persistent offender. Would-be criminals can readily hide their identity. They can troll and threaten anonymously. They can cast a million flies on the water with a phishing email soliciting PIN codes and account details from the unsuspecting. Paedophiles can operate with impunity in the secure bastion of the dark web. Thousands of credit card details can be purchased in that evil digital marketplace, too, stolen in skilful raids which take advantage of weaknesses in the cyberdefences of major corporations. Anarchists can and do mount denial-of-service attacks on institutions, powered unknowingly by malware secreted onto the computers of thousands of innocent users.
Most attacks are hidden and unreported, but we all recall the attack on TalkTalk, about which the noble Baroness, Lady Harding, has spoken, and which reportedly cost the company £60 million. Last year, malware was lodged within the systems of the Bangladesh Bank, and its internal processes observed over time. Earlier this year, during a public holiday, instructions were given by fraudsters to transfer just under $1 billion out of the bank. This was thwarted because, as is so often the case—we see it in phishing emails which reach the House of Lords—the fraudsters misspelled a word in the order, and the fraud was spotted by Deutsche Bank, though not before $80 million was lost and remains unrecovered.
Until recently, I was chairman of PayPal Europe, where I witnessed at first hand the gigantic scale of online fraud. Much of it is cross-frontier; barely any is investigated by law enforcement agencies, and little is prosecuted. I read a wonderful book recently, by an American historian, about Tombstone, Arizona, in the 19th century, when the discovery of a silver lode created a town virtually overnight in a part of the frontier that had been lawless. The internet is still a wild, untamed frontier with a plenitude of outlaws; and a latter-day Wyatt Earp is yet to emerge to bring us law and order. We do not know the full cost to the UK economy, and others, of online fraud but, from my own experience, I suspect that it runs into tens of billions. During my 10 years at PayPal, I saw multiple attempts to persuade Governments to tackle fraud, and they came to naught. I note that the estimable Sir Nigel Sheinwald has recommended that the UK should lead the way in developing agreements to foster global co-operation in fighting cybercrime. I concur, but at the same time note the terrible irony of that statement as our country prepares to leave the best possible stage for mounting and winning that argument in exchange for a bit-part role.
Although the Bill is a welcome, if small, step towards taking law enforcement further into the digital universe, I urge the Minister to bring due focus and energy, and proportionate measures within government, to fighting the full and value-destructive extent of crime committed by digital means.
Lord Lucas (Con)
My Lords, I could not agree more with the noble Lord, Lord Birt. The Government are inviting us to walk down the digital street, but it is a street which would have frightened Dickens. The Bill misses opportunities to do something about that. The information which the Government are giving themselves access to in the Bill would enable them to help us, as ordinary citizens, to deal with the tide of three-card-trick salesmen, conmen and pimps that assails us every day on the internet. However, there are no proposals in the Bill to do anything, which is quite astonishing. Of course, it is not astonishing because it is a Home Office Bill. We have had this before: noble Lords on the Benches opposite will remember when they tried to get us to take identity cards. That failed because it was a Home Office Bill; there was nothing in it for the ordinary citizen. All the advantages for the ordinary citizen that might have come from an identity card system were neglected. There was nothing there; it was just, “we want to control you”. Yet, as others have pointed out, we readily accept an enormous exchange of information and control with the likes of Google and Facebook because they offer us something in exchange.
The Home Office will have to get a grip on this. How are we to deal with open borders, post-Brexit? Presumably we will still have visa-free travel with Europe, as is proposed for Canada and other countries. It would be very odd to introduce visas, so we are going to need some kind of identity system so we can catch up on people after they have got in. This is about the only way one could police a border in Ireland, let alone one with Scotland. We really have to change the Home Office to an organisation which thinks of us as citizens as well as thinking of itself as a controller of citizens. It would be excellent if the Bill could start to do that by making sure that the Home Office at least has the power to use all the information it is gathering to start reducing the level of crime described by the noble Lord, Lord Birt. I also agree very much with the noble Lord and others on the need for international collaboration. That has to be the way forward. I do not share with him and the provisional Opposition opposite—I do not think that, after today’s meeting, I can call them the Official Opposition any more—the feeling that disconnecting from Europe will slow this down. This will be an international thing that does not care for other structures: a community that all nations committed to democracy will join, whether or not they are part of any individual organisation.
I have worries, too, that the Bill has not really addressed the question of speed. There are circumstances where the Government need quick access to information. In the course of the London riots, it was really noticeable how slow official processes were in catching up with information as to what was going on but communication service companies have those capabilities. They will perform checks online in real time if someone proposes to do a financial transaction. That is routine but you need access to and collaboration with the computing power that communication service providers have to make good use of it. You cannot seek to have a second-hand flow of information and hope to build government systems that will do the deed in real time, enabling you to get on top of the flow of information taking place among people in the middle of a civil disturbance. In the course of the Bill, we have to look at how to enable the Government to collaborate with the communication service providers when speed becomes of the essence and to make sure that we are not putting any obstacles to doing so in their way.
However, I share some of the concerns about the ICR and what we are creating with the request filter. We are producing a resource there that Francis Urquhart would have loved to have his fingers on: absolute knowledge of everyone’s private life. We would have to be so clear that what we are doing will not be abused and is not open to abuse. To have a system which can be accessed without warrant or proper record of what has been done—without proper supervision of those records—really opens us up to abuses of power and of position, in a way we should not do. I am very encouraged by the quality of the debate. This House is clearly full of people who understand these problems a great deal better than I do, so I am confident that we will do something about it. We should take this seriously and I look forward to Committee to do just that.
Baroness Ramsay of Cartvale (Lab)
My Lords, because of time constraint and the long list of speakers, I intend to be as brief as possible in this Second Reading of a vital and very detailed Bill. I hope there will be plenty of opportunity to deal at greater length with issues at the later stages of the Bill.
I speak from a base of my own professional experience in government service, where I spent some time in this precise field of activity, as well as having served in my parliamentary life twice on the ISC and later on the Joint Committee on the National Security Strategy. Today, I would like to make a few general remarks about what are called bulk powers because, over the last decade or so, they have been absolutely essential to the three security and intelligence agencies—SIS, MI5 and GCHQ—and everyone agrees that they are bound to be increasingly important in the future.
Bulk data are information acquired in large volume, as the Minister explained so very well in his opening speech, and are used to provide vital and unique intelligence that is unable to be obtained by any other means. Bulk data are among the most important tools that the agencies have to help them identify security threats inside the United Kingdom and threats to UK interests and citizens abroad, including in the Armed Forces, to find links between targets of interest, to establish behaviour patterns and communication methods, and to monitor attack planning et cetera. The Minister confirmed in his opening speech that the Government are committed to a review by David Anderson to assess whether the bulk capabilities provided in the Bill are necessary. I understand that the review is expected to conclude in time for our consideration of Parts 6 and 7 in Committee, so I look forward to dealing with it all then.
I conclude with one brief personal comment. Like the noble Lords, Lord West, Lord Campbell and Lord Rooker, I have some serious reservations about the so-called double lock, which involves a judicial commissioner in the authorisation process. I am quite content to have judges in oversight and judicial review but I do not feel at all relaxed about letting judges into the authorisation process. Not for the first time in this House, I say with the greatest of respect to any noble and learned Lords here tonight that I really wonder where this cult of judge worship comes from. It seems to grab legislators, especially when they are dealing with intelligence and security affairs. However, I hope we can come back to and elaborate on this at future stages of the Bill. On the whole, it really is an excellent Bill and I wish it a smooth passage through this House.
Lord Carlile of Berriew (LD)
My Lords, it is always a pleasure to follow the noble Baroness, Lady Ramsay, but it is a privilege to follow her on a subject of which she has the theoretical knowledge, and probably more practical knowledge than almost any other Member of this House—certainly more than most who are prepared to admit it. I know that repetition rarely involves improvement to the decent argument so I propose to make a few points of emphasis rather than repeat what has been said. I can say at the outset that I support the Bill, for the reasons just given by the noble Baroness and by noble Lords including the noble Lords, Lord Murphy and Lord Butler of Brockwell, my noble friends Lord Campbell of Pittenweem and Lord Macdonald, the noble Lord, Lord Rooker, and the noble Marquess, Lord Lothian.
I have some misgivings about the Bill. They are three in number and I can state them briefly. The first is the issue of legal professional privilege. I am not going to repeat a word of what was said so eloquently by the noble Lord, Lord Pannick, and my noble friend Lord Lester. I simply invite the Government to continue to consider that issue and to respond consistent with the advice that has been given in the debate.
My second misgiving relates to the use made of certain types of records. We have to be careful to ensure that, for example, medical records are used only for a legitimate purpose. I can see extreme circumstances in which medical records might be relevant to a terrorism event but the use of such records would have to be extremely carefully controlled, so what I would describe as the principle of legitimacy of use is essential to the Bill.
My third misgiving echoes something that was just said by the noble Baroness, Lady Ramsay, alluded to earlier by my noble friend Lord Campbell and stated pithily by my noble friend Lord Macdonald. It is about judges. I have general reservations, as she does, about the role of judges in what is essentially a ministerial act. It is Ministers who are briefed every day on national security issues and who have been issuing warrants though history. It is senior civil servants, such as some of the retired civil servants who have spoken so well in this House—there may be one or two more to come—who have consistently given advice to Ministers. I do not object to judges being involved in some way, but it must be a legitimate way. If judges are to be involved, it is to be for the verification of what has been done and of whether it has been done in accordance with legal principle. That means by the use of the rules of judicial review. Judges are not trained to authorise warrants. Most judges do not want to be trained to authorise warrants, and they should not be thrust into that role. I agree emphatically with my noble friend Lord Macdonald of River Glaven that it is desirable that serving judges should be included as judicial commissioners. It is not that retired judges do not do the job well—they do their work brilliantly in most cases—but the political optics of this issue are very important. The cohort of judges who act as judicial commissioners should include serving judges who go back from their commissioner role to the courtroom in which they give judgments on issues of fact and law so that they are seen to be not in any way the beneficiaries of political largesse.
Earlier, the noble Lord, Lord Blunkett, referred to a telephone call he made to me on 11 September 2001. It was probably a call I should not have returned because it resulted in my becoming Independent Reviewer of Terrorism Legislation. I did the job from 2001 to 2011. Even in 2011, it was nothing like as complex as it is today, and I pay tribute to my successor David Anderson QC for the brilliant work he has done, the outstanding legal analysis he has brought to his role and his sensitivity to the most difficult political setting in which he has had to carry out his role. It was much easier in the period when there was a Labour Government. Not all the Home Secretaries were entirely consistent in their views, but broadly they were, considering how many there were over those years, including one who is in his place on the privy counsellors’ Bench. David Anderson has had a much more difficult task. The House should be extremely grateful to him for what he has done.
I am frankly outraged, and I suspect David Anderson is, too, by the criticism of civil servants in the Home Office by one speaker in this debate. I observed civil servants in the Home Office over nine and a half years carrying out their role without bias, fear or favour, just doing their sometimes very difficult duty. The suggestion that civil servants in the Home Office, or anywhere else in the public service who I have observed at close quarters, have dealt with terrorism issues in a way that is dishonest in any way whatever just fills me with horror, and I hope that Lordships generally will reject that slur on our civil servants. It should not have been made.
Taking a much more constructive point now, I hope, what we have is a changing situation. As I discovered in my nine and a half years as Independent Reviewer of Terrorism Legislation, dealing with terrorism is not science or even art; it is just something that changes day by day. It does not evolve; it simply changes, sometimes suddenly, by mood and disruption in the political and democratic metabolism of the world. Sometimes the changes are unpredicted, and often they are completely unexpected. We should bear that in mind as we look at the detail of the Bill in the weeks to come, and I look forward to playing my part.
Lord Condon (CB)
My Lords, I support the Bill, yet in doing so, I understand all the fears and concerns about privacy that have followed it from inception and through its passage in the other place and which are now central to our discussions in your Lordships’ House. As we have heard, your Lordships now have the responsibility to set the balance between the need for privacy and the right of our fellow citizens to live in safety and security.
For seven years, from 1993 to 2000, I was Commissioner of Police for the Metropolis and, as such, during those years I was at the centre of the policing operations to combat terrorism and organised and serious crime. I think the main service I can provide to your Lordships’ House today is to emphasise, as other have, but from my personal experience and knowledge, how advances in technology have totally transformed how terrorists, serious and organised criminals and paedophiles prepare for their crimes, conspire together and carry out them out. That is why the provisions in the Bill are essential if we are to protect our citizens. In preparing for the Bill, I spent time discussing it with the current director-general of the National Crime Agency and her predecessor, and I spent time with their operational colleagues at all levels in the National Crime Agency.
In 1996, only 20 years ago, and during my watch as commissioner, only 45 million people worldwide had access to the internet, and only 15 million of them were outside the United States of America. Google did not open its first office until 1998. iPhones were launched only nine years ago. Compare and contrast these facts with your own experience. According to Ofcom, 66% of adults in the United Kingdom now have smartphones, 81% of adults send emails and 62% of smartphone users have social media applications. The way that terrorists and criminals plan and conspire to carry out their crimes has been transformed in the relatively short period since I left the service. They have migrated from using mobile phones and meeting each other physically to a web-based and largely non-verbal environment.
The methods deployed by law enforcement agencies to disrupt and detect criminality in all its forms and to protect society must keep pace with these changes. The tradecraft and methods of preventing and detecting crime from my time in policing seem increasingly obsolete and ineffective when faced with the challenges of the digital age and communications data. Law enforcement agencies need to keep pace with the realities of these changes. Analogue-age powers are no match for digital-age terrorists and criminals. Telephone calls are no longer central to how people communicate, and they are certainly not how terrorists and other criminals communicate. As other noble Lords have said, criminals and terrorists now use social media, WhatsApp, internet chatrooms and every opportunity that a rapidly evolving internet world gives them.
Legislation must respond to these changes and, with vital checks and balances, create a framework which allows law enforcement to combat terrorism and serious crime. In most respects, this Bill seeks to consolidate and recalibrate existing powers, but I acknowledge that the extension of powers into the world of internet connection records is controversial and challenging. I believe the extension of powers into internet connection records is essential and is a proportionate response to the real world in which criminality and terrorism are planned and now take place. Communication data are a vital evidential ingredient of virtually every major case dealt with by law enforcement agencies. For example, the House heard earlier about the recent gun smuggling case which was this country’s biggest known gun smuggling operation. It was analysis of communications data that provided vital evidence and allowed the attribution of telephones, various other devices and SIM cards, and the identification of key locations linked to the gun smuggling. It should be remembered that similar automatic weapons, from similar European sources, were used in the deadly terrorist attacks in Paris and Brussels. Analysis of recent National Crime Agency cases suggests that in at least 14% of its cases relating to child abuse imagery, it would require the retention of internet communication records to have any prospect whatever of identifying a suspected paedophile. The provisions in the Bill relating to ICRs are not really about extending the boundaries of acceptable law enforcement but are more about retaining law enforcement capacity in the dramatically changing digital world.
I hope we will find ways to assuage the very understandable and reasonable fears that some Members of your Lordships’ House have about some or all of the Bill. In particular, I understand the concerns about the proposals for internet connection records, including how they are defined and what they can include. If additional privacy offences are required, let us add them to the Bill; if additional safeguards are required, let us define and incorporate them. But I hope your Lordships will be prepared, after what I know will be robust discussion, to pass the main provisions of the Bill.
Baroness Chalker of Wallasey (Con)
My Lords, it is now some 19 years since I concluded my time of more than 11 years in the Foreign and Commonwealth Office. It was in that time that I became deeply aware of the need for proper legislation to assist the Government to protect our citizens. In the intervening 19 years, technology has changed out of all recognition, as many of your Lordships have already said. The Bill has been most thoroughly prepared, and I support it fully, but it may need some amendment—not major, because most of that work has been done, as has already been described.
Some will be surprised at my intervention in this very erudite debate, and it would be foolish at this hour to repeat the case for the Bill made so well by my noble friend Lord Howe in introducing our debate some hours ago and the detailed remarks that have been made about the different aspects of the service providers. I was very glad to hear from my noble friend Lady Neville-Jones when she spoke of the data outside the UK and the need to establish international agreements as the primary route for UK agencies to obtain data from the communications service providers—I agree with her. What I believe we need to do above all is to make sure that the Bill—the Act that it will become—is a template for other countries.
As noble Lords will know, I am involved in trying to encourage investment into the developing world. There is an urgent need for our legislation to be a template for other countries because no one, apart from the United States, is thinking in the terms that this Bill is thinking about what is needed. British companies, especially those in technology such as BT, are considering major investments overseas. They need to be satisfied that the legislation which will cover their operations in India, South Africa and many other countries is properly drafted. My concern is a little different perhaps from that of other noble Lords. It is that we get the Bill absolutely right, not only for the reasons that have been expressed here but so that we can work with others on security matters on a similar basis. We shall never be able to prevent all the criminal activity or the terrible sexual grooming using only UK measures and UK internet connection networks—we have to have, and set, an international standard. In thinking about the wider effect of the Bill, I suggest to my noble friend Lord Howe that we will need further amendments to it so that it is worthy of emulation around the world and minimises the risk of retaliatory action against UK communications service providers that are investing abroad.
We need to establish some international agreements as the primary route by which UK agencies obtain that data from overseas CSPs. I believe we should disapply the extraterritorial application of UK law in situations where it is done pursuant to an international agreement, in line with David Anderson’s recommendations. We should also ensure that overseas CSPs can bring their concerns to the Investigatory Powers Commissioner without conceding jurisdiction and permit the commissioner to see amicus curiae from effective parties. I hope we can set out the functions and responsibilities of the Investigatory Powers Commission, including a power to hear and respond to petitions from interested parties. I hope, too, that they extend the conflict of laws defence for overseas companies. We should not state in the Bill anything which might be construed as requiring a company to weaken or to defeat its security measures, which are a critical component of efforts to protect users from hackers and from other threats. This is a complicated area on which I have only very limited experience, but I believe we need to set the example for other countries and help to ensure that other Governments have laws with which we can work.
Lord Beecham (Lab)
My Lords, I begin by referring to my interest as an unpaid consultant to the solicitors’ firm of which I was for many years the senior partner, but also with an admission of what Members may consider is for me an unusual degree of diffidence. I have to admit to being far from a master of information technology, or indeed any other sort of technology, and therefore that I find the language of the Bill somewhat difficult. As has been stressed on all sides of the debate, here and elsewhere, there is widespread acceptance of the maxim that the first duty of government is the protection of the safety of the citizen; it is also accepted that the second duty of government is the preservation of the citizen’s freedom and privacy. Of course the issue before us is the degree to which these duties can best be reconciled.
It was encouraging that, as we have heard and as the JCHR report affirms, debates in the Commons saw changes being made to the Bill and commitments given to table further amendments as the Bill progresses through this House. The concern of Members of all parties to strike the right balance between the claims of security, privacy and liberty was welcome. We await sight of those amendments at as early a date as possible, and I hope that, unlike our experience with the Housing and Planning Bill of unblessed memory, we will be given the opportunity to consider in draft any proposed regulations before the Bill leaves this House. I especially welcome, as others have done, the Government’s acceptance that there must be a significant role for the judicial commissioner.
The two main areas which I wish to address are those of legal professional privilege—or as I would prefer to put it, client confidentiality, since it is not the legal professional who benefits as such from the alleged privilege—and freedom of the press, including the protection of journalistic sources, both of which featured in the list of matters identified by the Opposition in the Commons as requiring significant attention.
In relation to client confidentiality, as we heard from the noble Lords, Lord Lester and Lord Pannick, many Members have received the joint briefing from the three UK law societies, the Bars of England, Scotland and Northern Ireland, the Institute of Legal Executives, Justice and Liberty. Seven areas of concern are identified. These range from a bar on the targeted and bulk powers, as defined by the Bill, unless a judicial commissioner is satisfied that communications have been made in furtherance of crime, to protection for material when someone outside the UK communicates with a UK lawyer, the protection of data relating to privileged communications, and the extension of safeguards to the Regulation of Investigatory Powers Act, or RIPA as it is known.
The Joint Committee on Human Rights endorses the calls for change in this area, setting out proposed amendments to Clauses 25 and 100. Can the Minister indicate whether, and when, the Government will bring forward amendments to deal with these issues and indeed what view they generally take of the recent report of the Joint Committee on Human Rights?
In relation to press freedom and the protection of journalistic sources, the NUJ points to the potential impact on both journalists and their sources, in the latter case pointing out the risk to journalists who are in war zones or are engaged in investigating organised crime. While it makes a strong case, which I and others support, it would be enhanced if the conduct of the press itself had been above reproach, as the long-running saga that led to Leveson amply demonstrated. Nevertheless, the NUJ is surely right to aver:
“To have meaningful and effective protections for press freedom, the bill needs to be amended to offer a shield clause for journalists and this should apply across all of the powers that are specified in the bill”.
I recognise that it would be helpful to have a definition of a journalist. Would it, for example, include someone who undertook journalistic work while holding down another, full-time, job—for example, the previous Mayor of London?
The News Media Association joins the National Union of Journalists in calling for enhanced protection, as indeed does the Joint Committee in its proposed amendments to Clause 68, which would extend to journalistic sources the same protection as is currently applied to search and seizure under the Police and Criminal Evidence Act 1984. The committee, at paragraph 7.8, points out that,
“the applicant for authorisation is not required to give notice of the application to the media”—
an extraordinary departure from due process—while, under the Bill as it stands, the judicial commissioner need find only that there are “reasonable”, albeit in the circumstances untested, grounds,
“for considering that the requirements in the Act are satisfied in relation to the authorisation”.
To what extent are the Government prepared to move on these issues?
Different issues are raised in a briefing received at the weekend—I anticipate that other noble Lords will also have received it—from an organisation called techUK, which raises issues that in its view are likely to cause problems in relation to the storage of data and the costs to the industry, the latter not likely to be resolved by the stated intention that the Government will make an appropriate contribution that must “never be nil”—a remarkable turn of phrase which perhaps the noble and learned Lord can explain after he has been briefed on its meaning. I suspect that neither he nor I quite understand how that phrase managed to get its way into the Government’s response. However, more importantly, the organisation raises further questions about conflicting legal obligations, including EU regulations. The latter of course may not last for long for this country, but this is surely an area in which co-operation between jurisdictions needs to be preserved whatever happens following the referendum.
Finally and importantly, techUK asserts that the Bill threatens to undermine trust in the UK’s digital economy, with its 1.5 million jobs and 15% of GDP. To what extent, therefore, will the Government, including the Treasury and BIS, engage with the industry and indeed with the EU on these issues, and will they consider bringing forward amendments in these areas?
Lord Thomas of Gresford (LD)
My Lords, many concerns have been expressed in this debate—by my noble friend Lord Paddick and the noble Lord, Lord Blunkett, in particular—about personal privacy and the right to maintain a private life. However, I want to concentrate on legal professional privilege. It has been analysed brilliantly by the noble Lord, Lord Pannick, and my noble friends Lord Lester and Lord Macdonald, and I want to put some sort of colour to it.
Legal professional privilege is concerned with the public interest, not personal privacy, and it has been recognised as such since the 16th century. In criminal law, the individual is set up against the state. We prosecute from time to time and we are familiar with the power of the state to exercise surveillance and intrusion in the interests of arriving at the truth. On the other hand, defence lawyers are equally concerned with arriving at the truth. Something that some lay people fail to realise is that you do not win cases by putting forward defences based on lies. The immediate role of the defence lawyer is to impress upon his client the value of telling the truth, thereby building trust between him and that client.
What a defendant says at the beginning following his arrest may be completely untrue. Sometimes what he says has been suggested to him by other inmates in the prison where he is held on remand, or sometimes he will not tell the truth because of fear and sometimes because of guilt. When talking to defendants, I frequently say that if I were a doctor it would be no use if they had a pain in the head to tell me that they had a pain in their foot. I need to know the truth so that I can do the best for them. My noble friend Lord Lester was absolutely right when he said that defence lawyers might not know of a possible defence, and therefore the court and, particularly in a criminal case, a jury will not know that defence because the defendant, for reasons of his own, has not told his lawyer.
To illustrate that, I vividly recall a case in which I was involved in which the defendant—my client—was alleged to have shot somebody outside a nightclub in the presence of his friend. When, six days later, his friend was discovered also shot and my client had absconded and left the country, he was in trouble. His defence was that he knew that the friends of the person he had shot in the first instance were coming after him and they had shot the wrong person—they had shot his friend instead of him. The trial went ahead and he denied both the attempted manslaughter and the murder. He was convicted of both. We appealed because I did not think the conviction for murder was right. We failed and then, when I went to see him in the cells after the appeal, he told me, “Well, now I’ll tell you what really happened”. And for the first time I received from him an account that was completely consistent and believable. However, rather like a referendum, you cannot have a trial over again. That was it; that was the end of the case. He served a life sentence—and possibly is still serving it—for murder.
I am more familiar with the problems of client confidentiality in other jurisdictions. I recall one case in particular in a foreign jurisdiction, where the state was the other party, when we felt it was necessary to have our consultations and conferences standing in the middle of the swimming pool at the hotel in which we were staying because it was almost certain that our conversations were being bugged. Even in this country, involving a political issue in a foreign country, I recall that we talked to the wall as though there were people listening when the team met to discuss their tactics—for example, what inquiries were to be made and how we could support our client in the position that he was at that time.
So I am entirely with the noble Lord, Lord Pannick, in saying that when the commissioner is considering exceptional and compelling circumstances, the warrant must require—it must be shown—that there is a probable cause for belief in iniquity. Obviously, if a lawyer is colluding with his client in some shady business, that cannot be subject to legal professional privilege. I recall, in a very far-flung foreign jurisdiction, advising clients in a situation where the previous legal team had been arrested for attempting to bribe the prosecuting officers of that jurisdiction. We felt a little uncomfortable in the first place, but when something equivalent to half a million pounds in cash was put on the table in front of us in a plastic bag, we thought it was time to leave. So iniquity does happen; it is sometimes a temptation that is put in the way of lawyers.
I do not wish to carry on with further legal language such as “I once had a case”, so I will draw my remarks to a conclusion. However, I think the provisions in the Bill for legal professional privilege require considerable examination.
Lord Evans of Weardale (CB)
My Lords, as a former head of MI5 and a member of the RUSI panel that reported to the Government last year, I am pleased to welcome the Bill. We in this country have had statutory powers of interception for about 30 years and actual powers of interception for 400 years at least. Overall the statutory arrangements, which have been updated from time to time, have stood us in good stead. They have been a cornerstone of the work that the intelligence agencies have done since that time. It is largely as a result of that set of powers that the agencies have been able to keep our citizens safe from terrorism and other threats, and I am grateful to the noble Lord, Lord Strasburger, for the data that he provided to that end earlier in the debate.
They have also helped the police to prosecute many crimes, and that has been undertaken on a lawful and accountable basis. It was encouraging, for example, that the various inquiries that followed the revelations made by Edward Snowden, now in Russia, did not uncover any illegal activities by the British agencies. This appeared to be a surprise to some commentators, and in some cases a disappointment, but it should not have been because anyone who has worked in or with the agencies will realise that they set great store by operating on the basis of law.
Technology and public expectations move on, though, and the Bill will therefore propose a number of changes that I believe we should welcome. I suspect we will not need to make significant changes in the light of the referendum result last week. In particular, the Government have recognised the need to lay out more clearly the way in which various powers are actually used; I suspect there was a sharp intake of breath when that was decided, but in fact I think it was the right decision. As David Anderson rightly pointed out, the previous arrangements, though lawful, were, to say the least, opaque.
The powers in the Bill are necessary if the people in this country are to be able to live their lives in security, and I take as an example the use of bulk personal datasets. The use of such datasets has been the most striking development in investigative methodology that we have seen in the past 15 years, and as digital activity and life on the internet has become absolutely normalised, the use of bulk datasets has become a vital capability in enabling the agencies to make sense of the movements, associations and activities of potential terrorists and separate out the truly threatening from the background noise. It is right to make this capability and its existence clear and to ensure that the datasets are accessed on an accountable basis. There is nothing improper or alarming in using data for these ends, but it is better if we all know what is going on.
I also welcome the double lock authorisation model, which was one of the proposals made originally by the RUSI panel. It is important to keep Ministers in the authorisation loop, since the use of these powers is a matter of public concern and often of national security, which is a responsibility of government. But the judicial role can give assurance, if any is required, that Ministers are not abusing their powers. I may say that having been involved in the process of applying for warrants for 30 years at various levels within the security service, I am not aware of any case where Ministers tried to abuse their authority, but at least we will have that assurance.
Finally, it is important that in scrutinising this legislation we bear in mind that it must provide a framework to support fast-moving, complex and sometimes intensive live operations. Those using the powers on our behalf have to be able to move as fast as those who are planning a terrorist attack, importing a drugs shipment or procuring the online abuse of a child. This process cannot be mulled over at great length as operational requirements arise. I can remember in the period after the 21 July attacks in 2005, which was probably the most intensive period of warranted activity that the security service had then experienced, that all authorisations had to go through the deputy director-general for operations, who at that stage was myself. This meant that I was rung at all hours of day and night, 24 hours a day for several days in a row. I am glad to say that that exact procedure has subsequently been amended, but the principle that we are able to respond in real time to events and not to be held up by processes which are intellectually attractive but practically applicable is very important.
Bureaucracy and accountability are not the same thing. There needs to be clear and effective authorisation and oversight of these powers, but it needs to be done in such a way that the powers can still be used quickly and without unduly burdensome process. Thematic warrants may well fall into the category of activities that are needed for this purpose. One of the strengths of the British approach to these issues in the past, which has not always been achieved in other jurisdictions, has been to keep operational realities in mind and to create processes that provide oversight but do not bog the agencies or the police down in unending paperwork.
As we update the legislation governing the use of investigative powers, we should not lose that vital balance between accountability on the one hand and operational realities on the other. I look forward to taking part in the further scrutiny of this legislation in your Lordships’ House.
Baroness Browning (Con)
My Lords, I welcome the Bill. The amount of scrutiny it has received has been such a help in producing the Bill before your Lordships tonight. I was pleased to have the opportunity to serve on the Joint Committee, which was so ably chaired by the noble Lord, Lord Murphy. I was particularly pleased—comment has been made about this tonight—by the way in which another place dealt with the Bill. One of my permanent gripes is that we in this Chamber often receive legislation which is imperfect not because nobody at the other end was interested in it but because the iniquitous guillotine fell and huge chunks of legislation passed totally unscrutinised from another place to this Chamber. I opposed this vigorously when it came in many years ago—as Members will remember—but lost. I feel that if we are about anything in this Chamber, we are about scrutiny, but that applies also to another place. So it was not just that they spent a lot of time on it but that they looked at every line. I hope that perhaps future Bills will emulate that procedure.
On the Joint Committee we had the opportunity for a visit to the Metropolitan Police intelligence bureau. One of the things that struck me was that although a lot of our conversation was about how the Bill would help with serious organised crime and terrorism, we saw things in practice there—the noble Lord, Lord Evans, just touched on this—such as how having quick and timely access to data can help in ways that had not occurred to me. For example, when the police are notified of somebody who has gone missing who is a potential suicide case, or when a child goes missing and there is concern about them, access to telephones—a lot of children walk around with telephones and electronic devices—to be able to find out in a timely way where they are and who they have called saves lives, apart from the bigger issues that the Bill concentrates on.
Of course, among the people who came before us to give evidence, we heard from the judges. I support the double lock; it is a very good move forward to reassure the public and politicians. It is one of those measures that is perhaps tucked in the pocket just in case, at some point, this country could not rely on its politicians. I believe that we can rely on our politicians but—who knows?—maybe one day we will not be able to.
I was worried about the training of judges. Are these judges really going to get to grips with this subject, which is not something that they are dealing with every day? But I was reassured. I notice that my noble friend Lord Carlile of Berriew is not in his place at the moment, but I will draw to his attention that I said this. The judges reassured us that they would look at each warrant, case by case, and apply the rules of judicial review to give some reassurance on the way that they would approach their side of it.
It is also very important, perhaps more for the other end than for this end, that the Home Secretary can appear at the Dispatch Box and be questioned about individual warrants—something that a judge cannot be required to do. That is such an important part of our democratic process in this House.
Already mentioned is the way that technology moves and the way that our security services have to keep one step ahead all the time. However, there is another ingredient in the mix where our intelligence and security services need to feel that they are always one step ahead, and that is to do with political will. The intelligence and security services need to feel that, in these two Chambers, there is the political will to enable them to be able to access the sort of information and methodology that they need. As former Prime Minister Baroness Thatcher said, back in the 1980s, terrorists only have to be lucky once. It is against that backdrop that our security services need the support of this House to keep things well balanced. We must make sure that we give them every opportunity to keep us safe.
There are measures that have already been mentioned that we will need to look at. I know that my noble friend the Minister will be as forthcoming as he can be on the issues that have been raised about lawyers and journalists.
Finally, another area on which we took evidence in the Joint Committee, which has already been touched on, is the situation with the communications service providers. My noble friend Lady Harding spoke on behalf of what I regard as quite a large service provider. But we also took evidence from some of the smaller service providers, which expressed concern about the capital costs involved in this. So I hope that the Minister will be able to reassure us in Committee. It would not be a satisfactory outcome if, when we were finished with the Bill, it was public knowledge that some small companies were not up to speed and up to the mark in terms of people who might use their services. That would leave a gaping hole in our security. Just think what would happen if we ensured that the larger communications service providers could meet the standards required under the legislation but, somehow, those who wish us harm could go elsewhere.
Baroness Kennedy of The Shaws (Lab)
My Lords, I have to say that I have had one of the greatest surprises in the course of this debate that I have ever had in this House. That was hearing my noble friend Lord Blunkett express humility—humility in relation to his efforts to deal with terrorism and with the efforts of this House to call him to book when he seemed to be going over the line. I did not quite recognise whether there was regret, but certainly he seemed to acknowledge that scrutiny of the efforts to deal with serious crime and terrorism is a very important thing to take place within our parliamentary system.
I welcome the Bill because it places the work of the intelligence and security agencies within a robust legal framework. As others know, I have spent a large part of my professional life dealing with high-level security cases, often involving terrorism, such as the transatlantic bomb plot not that long ago, which was mentioned by the noble Lord, Lord Reid. These were serious cases in which new technology was used by those who stood trial and where being able to intercept was clearly vital to the interests, safety and security of British citizens.
The noble Lord, Lord Rooker, suggested that the RUSI panel’s 10 tests might in fact be placed inside a pamphlet or a paper by the Government to show how the Bill complies with them. I strongly support that suggestion and think it would be a very helpful reassurance to many of those who have criticised the steps taken to deal with these sorts of issues.
There is no doubt that we have to be always vigilant when we are dealing with the rights and liberties of British citizens. When private exchanges between individuals are invaded, there are consequences for all of us, not just the individuals involved, because societies that create a dark state, with extensive surveillance powers, have always in the end reaped the consequences: authoritarian abuse, serious miscarriages of justice, the growth of political mistrust which always follows, and ultimately a crushing of the human spirit. I agreed entirely when I heard the noble Lord, Lord Macdonald, describing what this does to the lives of individual people, the way that it invades the creative and intimate lives of people—the stuff of people’s souls. So we have to move ahead but with great care because sometimes invasions of privacy are absolutely necessary but they should be rare and under strict regulation.
The areas in the Bill that cause me most concern have already been spoken to. They relate to the protections that there must be for communications essential to the fairness of the legal system and communications essential to freedom of the media. A citizen has to have the right to confer with a lawyer in confidence; I will not repeat the arguments that have been presented to this House by my colleagues in the law. My life as a practising lawyer doing these sorts of high-level, politically sensitive cases has made me pretty cautious about claims concerning national security because that can be an elastic notion, capable of being harnessed for questionable ends.
I am concerned that the definition of “exceptional and compelling circumstances”, and the draft codes of practice that have been put together, set the bar too low. These can be broadly and loosely interpreted and the risk is that the law will enable and encourage the routine acquisition, examination and retention of legally privileged communications. That should concern us. Currently such a practice is deemed unlawful but we know from the Belhaj case in 2015 that at times that has not stopped inappropriate behaviour. We should always remember that codes of practice are not law. They do not have legal force and they can be changed without parliamentary scrutiny.
What should concern us is that when the Government were pressed in Committee in April about what they really intended, and they gave examples, they seemed to say that the purpose was to obtain strategic intelligence. That is just not a justifiable reason for this legal change. It is, I am afraid, dancing to a tune that is not acceptable in a democratic society. We cannot allow it to be used to interfere in privileged communications between lawyers and their clients simply because there might be a possibility of coming up with something. There has to be something more than that. The Law Society, the Bar Council, Liberty and Justice are all pressing for amendments. The Government have said that they will listen and I hope they will.
I am also concerned about journalists and the protection of sources. I agree with the noble Baroness, Lady Liddell. There are problems because of the expansion of journalism into the internet, the arrival of blogging and the ways in which people claim the title of journalist who would not have fulfilled that definition in the past. However, we have to be cautious about enabling journalists to make the public aware of things that are happening in society which has to involve their giving promises of protection to their sources.
I welcome the fact that David Anderson has been invited to review the use of bulk powers. Like the noble Lord, Lord Lester, I think he is a truly honourable man. He has an independent mind and is an invaluable public servant. I am glad that he is responsible for the review and I look forward to hearing what he has to say.
Clause 1 re-legislates the criminal offence of hacking telephones that saw the conviction of the Prime Minister’s press secretary for conduct when he was the editor of the News of the World. Nine other senior journalists at more than one newspaper—indeed, at more than one newspaper group—were also convicted. There were hundreds, if not thousands, of victims of that criminal conspiracy, many of whom were ordinary members of the public whose privacy was grossly intruded upon in a wholly unacceptable way. It is right that that offence is re-codified in the Bill. It is not only the state that intervenes in people’s privacy.
Many victims of phone hacking have taken out civil claims based on the common-law tort of misuse of private information. The old RIPA included in Section 1 a statutory tort but that has not been re-codified in this Bill. Why will citizens not have that entitlement any longer? I hope the Minister will help us with an answer to that question and perhaps the tort may be reinserted in the interests of fairness to those victims.
As we have heard, striking the balance between liberty and security is hard. The best way to do it is with trusted oversight and transparency. I welcome the openness of the Government in seeking to meet the concerns and I look forward to the debate in Committee.
Lord Oates (LD)
My Lords, it is intimidating to follow so many noble and learned friends on my own side, let alone all around the House, but I am grateful for the opportunity to speak in this debate because, over the five years that I worked in the coalition Government, we wrestled with many of the issues that this Bill attempts to address. We recognised that our society faces real threats and that it is the duty of the Government to address them.
The then Deputy Prime Minister for whom I worked took that responsibility extremely seriously. He never had the slightest patience with those who dismissed these threats or opposed necessary proportionate and workable measures to counter those threats for ideological reasons. He was committed to ensuring that the security services had the powers they needed and he supported legislation where there was an evidence-based case for it, such as the Data Retention and Investigatory Powers Act 2014. He opposed legislation, such as the draft communications data Bill, where there was not. He was as impatient with those who were careless of our liberties as he was with those who were careless of our security.
I share the approach that he took. I do not see liberty and security as items to be weighed against each other on opposing scales but as principles essential to reinforcing each other. There is no liberty without security but, equally, no security without liberty. Anyone who has lived in a country where the authorities are constantly monitoring what you do, and where they think that they have the right to interfere with your liberty, will know just how insecure that makes you feel. I have no doubt about the threats we face or of the suffering brought about by terrorism, child exploitation or any of the other heinous crimes that the police and intelligence services have to tackle. I was lucky enough to work alongside members of the intelligence services in the previous Government and I have nothing but admiration for the work they do on our behalf and the way they go about it.
I welcome the fact that the Bill is a considerable improvement on the existing arrangements. It covers previously unavowed powers and contains significantly greater safeguards and oversight than had previously been present. It is particularly welcome that it has dispensed with the proposals in the draft communications data Bill that UK network providers be forced to collect and store third-party data relating to services operated by companies overseas.
At the time of the communications data Bill, we refused to agree to such a proposal because no one could make a credible case for it. In the absence of evidence or argument, it was simply asserted that if we did not agree to such a proposal, public safety would be put in jeopardy. Without a shred of evidence to support it, people who should have known better—including some Members of this House—went on television to castigate the then Deputy Prime Minister in the most lurid terms, accusing him of putting lives at risk.
Of course, subsequently, the highly respected Independent Reviewer of Terrorism Legislation, David Anderson QC, investigated the issue and could not have been clearer in his report that he found that no operational case had been made for the power and that,
“there should be no question of progressing this element of the old draft Bill until such time as a compelling operational case has been made”.
It is with that experience in mind that I am sceptical of demands for powers which are not backed up with evidence and which Ministers seek to push through simply by making an assertion that they are necessary for public safety.
While I welcome many parts of the Bill, it is in that context that I regard the retention of internet connection records as an issue of grave concern. The Home Office failed to make an operational case for it. The Government have not approached the issue by demonstrating where a lack of data is obstructing criminal investigations and then exploring how to tackle it. They have taken a proposal that the Home Office has been pushing unsuccessfully for nearly 10 years—perhaps more—and stated that the data would be useful for the police and intelligence services. That is not evidence-based policy-making; it is policy-based evidence-making and we should not accept it unless we have some much better answers than the Home Office managed to provide in the other place.
As my noble friend Lord Paddick highlighted, the Bill establishes a power for the Government to demand the retention of the internet connection records of every single person in this country for a 12-month period in case the state might wish to interrogate those data at some future date. It allows access to the huge amounts of data that will be collected by designated persons without a warrant. It is a very significant power for the Government to demand, a power which outside Russia is operated by no even nominally democratic country in the world. As my noble friend pointed out, Denmark, which operated such a system, has abandoned it, as its security forces were drowning in information they could not process. The scale of data retention under this proposal will be massive. The storage of such a vast amount of personal and private data will be a honeypot for hackers and risks compromising the privacy of millions of innocent people.
Many noble Lords have rightly made the point that the measures in the Bill have been subject probably to greater parliamentary and independent scrutiny than any similar measures that have come before Parliament, and the Government have made many welcome changes. I note in passing that this scrutiny and these changes have been possible only because people in the previous Government would not accept the imposition of measures without scrutiny and an evidence base and insisted that it be provided.
But despite all the parliamentary scrutiny, the public are almost wholly unaware that when this Bill is enacted it will mean the retention of everyone’s often highly personal internet connection records for a period of 12 months, under conditions of security which are unclear. When this power is put to members of the public, the evidence is that they are almost universally horrified by the potential threat it poses to their privacy. We should take that extremely seriously and we should be extremely cautious before we grant such a unique power to our Government. Neither should we lull ourselves into a false sense of security about what security this data can actually provide for us. We should not be naive enough to ignore the fact that those who wish us harm, such as Daesh, are unlikely to be troubled by such a power; they have plenty of ways to mask their activities.
So I hope that we will proceed with caution rather than complacency before we grant the power. In particular I hope that the Government can answer a number of questions. What exactly will ICRs cover? How will the ICR requirements operate in respect of communications on mobile devices via apps? What is the scope of the information they will provide? Where will the data be stored and under what conditions of security? Also, how is it sustainable for the Government to claim that these vast amounts of data can be stored and accessed securely at such a comparatively minimal cost? How is the figure calculated and is it not likely, as it is so often in these cases, to be exponentially more expensive than originally estimated? Lastly, why is the Home Office demanding a power that none of our allies appears to believe is proportional or necessary? We need answers to these questions before we proceed with this part of the Bill.
A number of other important issues in addition to ICRs have been mentioned today, in particular legal and professional privilege, bulk data collection and issues of extra-territoriality. All are areas that we will need to consider carefully during the future stages of the Bill. Finally, we should be wary of creating too cosy a consensus on this Bill lest that dulls our skills of scrutiny when there are very serious issues still to consider.
Viscount Colville of Culross (CB)
My Lords, I declare an interest as a producer at the BBC. I congratulate the Government on bringing this Bill before the House. Like most noble Lords I recognise that the security services need up-to-date powers in their technological battle against terrorism and criminality, and I am pleased that these extraordinary powers of surveillance will now have judicial control. I am sure that the interception of digital communications will help prevent much terrorism and that many criminals will be convicted using the evidence collected.
However, there is a whole area of information gathering which must be safeguarded by privilege. Noble Lords have spoken about the importance of privileged information between lawyers and their clients and between MPs and their constituents, so it is not surprising that as a journalist I want to put the case for extending the privilege of safeguarding journalists’ sources of information. I look forward very much to the debate in this House on defining what is serious journalism, and who and what information should come under journalistic privilege.
I appreciate that the Government inserted an amendment into the Bill in the other place requiring the judicial commissioner to have regard to the public interest consideration for requests to investigate communications data for a source of journalistic information, but I fear that this privilege is far too specific. It applies only to requests to search directly for “journalistic sources” and from only one power in this Bill: that of communications data. But there are many other powers in the Bill which could directly or indirectly identify a source. I should like the Bill to extend the public interest consideration for any request to access journalists’ data to cover other methods of surveillance, including the accessing of internet connection records and equipment interference, both of which could identify whistleblowers.
I very much appreciate the powers in the Police and Criminal Evidence Act 1984 which allowed notification to journalists and media organisations of requests to access journalists’ notebooks so that they can respond to those requests. I would like the Bill to mirror those powers in some way and to extend that notification to cover some warrants to access journalists’ data so that they and the media organisations can make representations to protect their sources. I know only too well from my own experience and that of colleagues how important it is to guarantee protection for sources when uncovering cases of wrongdoing. I am certain that in many cases we would not have the information unless the sources were convinced that they were safe from having their identity revealed to their bosses or other authorities when reporting cases of wrongdoing.
I have been speaking to a number of my colleagues who have been involved in extraordinary investigations whose publication has shocked the nation and led to changes in the law and policy, and huge reforms to the institutions that have been investigated. Two stand out for me: the “Panorama” investigations by my colleagues at the BBC into Winterbourne View care home and the Medway Secure Training Centre, both of which have been mentioned many time in your Lordships’ House.
Winterbourne View was a care home, commissioned by the NHS and managed by private providers, to care for adults with learning difficulties. The “Panorama” investigation revealed that a lack of leadership led to a regime of barbarity against the patients. I fear that, unless the programme had been broadcast, nothing would have happened to address this abuse. Margaret Flynn in her report on the home said:
“There is no evidence that the written complaints of patients were addressed … managers did not deal with unprofessional practices at Winterbourne View Hospital. Absconding patients, the concerns of their relatives, requests to be removed and escalating self-injurious behaviour were not perceived as evidence of failing service. The documented concerns of whistleblowers made no difference in an unnoticing environment”.
There were 29 contacts with the police and eight incidents of staff violence on patients were reported, with only one prosecution. The police now admit to over reliance on information from hospital management. For years, nothing was done to deal with the underlying abuse. In desperation, whistleblowers went to my colleagues at the BBC. One was later named, but others have not been to this day. Their determination to remain anonymous is not surprising, as they know that they would never work again in the industry if their names were released—but the information they gave meant that, finally, something was done to change the regime and safeguard the patients. During the “Panorama” investigation, whistleblowers were able to build up a relationship of trust with the journalists. That trust was predicated on the conviction that the authorities would not be able to identify who they were.
Likewise, whistleblowers were essential to uncovering the abuse of young men jailed at the Medway Secure Training Centre, run by a private company for the Ministry of Justice. An independent panel to investigate the centre has revealed that over seven years 35 written warnings about the regime at the centre were not acted on by the National Youth Justice Board. Once again, in desperation whistleblowers contacted my colleagues on “Panorama”. Some had previously gone to the authorities to complain and no action had been taken; others contacted the journalists directly. For most of them, and certainly the main whistleblower, whose name is still not known, the only basis on which they went to the journalist was the promise that nobody would ever be able to identify them. Their testimony and the subsequent secret filming revealed a regime of extreme barbarity against the young men at the centre, which brutalised them—the very opposite of what the centre was supposed to do. The mother of one inmate, Billy, said, “My boy is no angel, he is difficult, but this is going to make it worse”.
As a result of the Winterbourne View investigation and others into care and disability units across the country, the Care Quality Commission was reconfigured and the charge of corporate neglect entered our statutes. Safeguards for people in these units have been established across the country. As a result of the Medway exposures there have been parliamentary debates, at least 10 arrests, guards have been suspended and the unit director has resigned. G4S has announced that it is selling off its children’s services and the centre has been nationalised. These cases are proof of the extraordinary role that whistleblowers can play in revealing wrongdoing and changing our country’s landscape. As my colleague Joe Plomin, the journalist behind these stories, told me:
“We threaten the confidence with which whistleblowers contact me at our peril—how will we as journalists prevent the abuse of children or disabled people or others in future where all authorities including the police have allegedly failed, if whistleblowers feel unable to safely, securely contact us? Our democracy, all of our safety depends on people being able to speak to us where all else has failed”.
I ask your Lordships’ House to do everything possible to ensure that this Bill guarantees their secrecy and allows journalists to explain to the judge the public interest reason for that secrecy to be continued. This need is reinforced by the many occasions when the authorities, and especially the police, secretly obtained journalists’ records. The report of the Interception of Communications Commissioner’s Office in 2015 into the use of Chapter II of Part 1 of the Regulation of Investigatory Powers Act to identify journalistic sources showed that police had secretly obtained the phone records of 82 journalists over a three-year period to find confidential sources. It said:
“Generally speaking the police forces did not give the question of necessity, proportionality and collateral intrusion sufficient consideration. They focused on privacy considerations … and did not give due consideration to freedom of speech … The current Home Office Code of Practice (and the recently revised draft Code said to provide protection for sensitive professions) do not provide adequate safeguards to protect journalistic sources or prevent unnecessary or disproportionate intrusions”.
I, like all noble Lords, have the highest regard for our forces of law and order. I am sure that they will think that they have compelling reasons for investigating a journalist’s records, but I would like a judge to decide whether the reasons are in the public interest. It is important that the judge, deciding on a warrant for journalists’ data, should have to notify them so that they can at least put their case for the need for the absolute confidentiality of sources to be maintained.
Lord Henley (Con)
I support the Bill, and I have to say that, in all my years in this House, I do not think I have ever seen a Bill that has had better and more thorough scrutiny as it has passed through another place and various committees.
I served on the Joint Committee that looked at the draft Bill under the very skilful guidance of our chairman the noble Lord, Lord Murphy, and I thank him for the work he did, particularly given the very difficult time constraints. We only started sitting in November and had to produce a report by February. Others have gone into the amount of time we spent on that Bill, the amount of written evidence we received and the number of witnesses we saw. We can only offer praise to the noble Lord for what he did on that Bill. I hope the Government take note of that.
Others who have spoken in this debate also served on that committee and there is no need for me to add any more; however, I also served on the Joint Committee on Human Rights, along with the noble Baroness, Lady Hamwee. She will no doubt want to say a little more about that in due course, as will I. I should also add that I had the privilege of serving as a junior Minister with my right honourable friend Theresa May, the present Home Secretary—where she will be in a number of weeks or months, we do not know, but I hope she at least sees this Bill through—as did my noble friends Lady Neville-Jones and Lady Browning.
I say in passing—this is not related to the merits of this Bill—that I believe that my noble friend Lord Howe and my noble and learned friend Lord Keen will do the most excellent job in taking the Bill through this House. I would normally like a Bill to be represented by its own Minister as it is taken through, rather than by people who have come in from other departments. This is not simply a question of propriety for propriety’s sake, but one that goes to the heart of how this House performs its duties and functions. My noble friend will remember that we served together on the Front Bench, in government and in opposition, for some 20 years. Indeed, he has been in this House on the Front Bench, government and opposition, for some 26 years. He will remember that, particularly in the 1990s, we often had to speak for other departments. Seeing my noble friend Lady Chalker here, I remember on occasion doing Foreign Office Questions for her when she was away on important business, when I was serving in other departments.
However, when it comes to Bills, it is very important that the Minister in question should be properly embedded in that department, so that everyone knows they are a Home Office Minister, for example. It is they who have day-to-day access to the civil servants; it is they who have seen the Bill develop, and probably played a part in that development. They will know better than a Minister from outside exactly what is in the mind of the Secretary of State and what she is thinking. As I said, he is seeing the civil servants on a daily basis. He is no hired gunslinger brought in from outside to get the legislation through but part of the team that has developed the Bill. I hope that my noble friend will not mind my making that brief point as it is important. I hope that whoever the leader will be in the future will take note of that when ministerial posts are allocated.
As I said, I do not want to say anything about the Joint Committee that looked at the draft Bill under the noble Lord, Lord Murphy. However, I wish to comment briefly on the work of the Joint Committee on Human Rights. As noble Lords will be aware—this has been referred to—the Joint Committee managed to produce a report on the Bill before another place reached Report. I think the report was dated 2 June. It made a number of recommendations which influenced the debates on the Bill on Report in another place. I think that various amendments were made. As noble Lords who have had a look at the report will be aware, it proposes that the Joint Committee table further amendments at later stages of the Bill. Certainly, the Joint Committee will be looking at those. Therefore, I would be very grateful to my noble and learned friend Lord Keen if he could say a little more about the Bill’s timing when he winds up than did my noble friend in his opening speech. We know that we will have four days in Committee before we break up for the summer. We will then have a further two days in Committee in September, which will allow us to look at the report by David Anderson QC into bulk powers. I take it that we will then come to Report at some point in October—presumably the second half of October. However, it would be useful if my noble and learned friend could confirm that so that we on the Joint Committee can consider those matters in time to produce yet a further report among the many other reports with which both Houses have been burdened—however, those reports have been useful—before this House considers those matters.
Lord Reid of Cardowan (Lab)
My Lords, being the 36th speaker in a Second Reading debate has some advantages and disadvantages. The advantage, of course, is to be able to listen to and, I hope, learn from the substance and detail of the points that have been made. I have tried to do that this evening—other than when I have been called away to another fraternal Parliamentary Labour Party meeting. The disadvantage, of course, is that almost everything has been said. Therefore, I will confine my remarks to two or three simple points which I freely admit do not arise from my understanding of jurisprudence, expert legal training or philosophical depth but from my experience as a practitioner in government. I admit that I have authorised and used intercepts—I hope for the benefit of the people of this country—and, therefore, I wish to say a few words about necessity and proportionality and perhaps a little about scrutiny.
Why do I think that the Bill as a whole is necessary? Of course, details of it will have to be discussed and debated but in my view it is necessary because I have seen at first hand thousands of British citizens’ lives saved not only by intercept but largely by intercept and intelligence based on intercept. Leaving aside when I was Northern Ireland Secretary, when I was Home Secretary I dealt with some 40 to 60 cases of counterterrorism of greater or lesser significance. Almost all of them involved more than one country. I recollect one case where there were almost 20 countries. It is not only the interception of communications, but the global nature of the communications which are now an essential field for interception if we are to protect the lives of British citizens. In one case, which I mentioned earlier to the noble Lord, Lord Strasburger, the potential victims numbered 2,300 to 2,400. There were seven aeroplanes involved in the plot which was foiled in August 2006. Without going into detail, we were watching, at various stages, minor actors in that tragic drama. It was only through intercept, and some of the powers enshrined in this Bill, that, fairly late in the day, we discovered that we were looking at a subset and the main players were actually somewhere else. It is practical experience which has convinced me of the necessity for this type of power, not in every detail but in general.
Secondly, I do not think proportionality can be discussed unless we see it in the context of two things. One is the threat, and the changing nature of it. The other is the changing nature of communications. Both of these have been touched upon today. In other words, the objectives of the intelligence agencies, Ministers and the counterterrorist authorities have not changed; what has changed is the world, and particularly the nature of the threat and the nature of communications. As we know, the threat now stands at the second highest level—severe—which means that a terrorist attack is “highly likely”. That is not my view but that of the analysts and the authorities who decide these things. As the noble Lord, Lord King, mentioned at the beginning of this debate, the nature of the threat has changed even from 15 to 20 years ago. The threat from the IRA was big enough but they did not tend to want to blow themselves up or be caught. That change makes it much more difficult and reliant on prevention through previous intelligence. In 2014, some 10,000 Europeans went to Syria as jihadists. It is estimated that about 5,000 of them have returned to Europe. In Britain, the numbers are roughly 800, with 400 returned. Last year, the intelligence services foiled seven major plots here, 13 in France and various others throughout Europe. Where they did not succeed, we saw the tragedies of Tunisia, Brussels and Paris. Proportionality has to be seen against that background.
The world of communications has changed. As several noble Lords have said, we now live in a cyber world. Cyber is not an amalgam of technologies. It is not just a means of communication. Cyber is the first man-and-woman-made environment. It now permeates absolutely everything. It gives unparalleled opportunities for people to reach out for education and information; it has an amazing potential to liberate human beings. However, like all forms of technology, it has an amazing capacity to be used for evil as well. It is the communication method of choice for terrorists who would do evil—I am responding to this only in terms of counterterrorism.
I remember using one of the first digital phones, back in 1985 on a march from Gartcosh to London. I was given it by a press organisation that wanted to cover the march for jobs. It weighed as much as a brick; it looked like a brick; it was as useful as a brick. You had to charge it for 12 hours to get 20 minutes off it. Now, between 3 billion and 4 billion people in the world are using the internet on mobile phones for communication. They are the communication method of choice for the terrorists themselves. Although it brings unparalleled opportunities for good, it also does for bad. We have to empower the intelligence agencies and those trying to counter the use of that internet technology not just for communication purposes but for propaganda, recruitment and radicalisation purposes as well.
While I have no doubt about the proportionality of the generality of the Bill, my final point is about oversight and balance. I am sorry that my noble friend Lady Kennedy is not in her place because she said earlier on that she had been surprised by the humility of my predecessor, my noble friend Lord Blunkett. Well, it is a lucky day as I was going to give her a surprise as well.
Lord Reid of Cardowan
My noble friend Lord Blunkett is here. I do not think that he heard my noble friend Lady Kennedy’s comments but I have a surprise for her. I do not take the view that security overrides everything. I take the view of a need for balance. Various people have mentioned tonight that the protection of our citizens is the first duty of government, but that is a mistranslation. With my O-level Latin, I can tell your Lordships that Cicero’s “Salus populi suprema lex esto” does not mean that that protection is the first duty of government but that the welfare of the people is their first duty. That welfare combines the protection of their rights and well-being with the protection of their lives, which is why we are trying to get a correct balance on this.
I am all for examining the Bill in detail in Committee, including legal professional privilege, issues about journalists and so on. But I would plead with your Lordships: I cannot think of anything that I have seen going through Parliament, in my 30 years or thereabouts, that has had quite so much scrutiny. I therefore hope that it will get a fair wind, because of not only that prior scrutiny but that which is to come from David Anderson as well—and because of our obligation to supply the tools to our intelligence agencies and those trying to protect the people of this country.
Having said that, I have one reservation, which is about the introduction of judges to a greater degree than was previously the case. If the double lock becomes a double decision-making process on the substance of the political decision, I would be very worried. I understand why the Home Secretary did it and the perceptions in certain sections of the public—not what I would call public opinion but certainly published opinion. It therefore became a necessary element of making sure that there was a fair wind behind this Bill. I accept that, but I have some reservations with it. So, with all that, I wish the Bill well and I congratulate the Secretary of State for the Home Office. She has been extremely patient. This has been in embryo not for two years but for almost 10 years, through various people. I wish her well in her present job and in any job that she may be seeking to do in the future.
Baroness O'Neill of Bengarve (CB)
My Lords, as the very last Back-Bench speaker I might not have much to say but I have one thing to say at the start: it seems rather a good day for this Second Reading because the Bill bears on UK national security. I therefore hope that, unlike some current Bills, it will still have adequate government support amid the political disarray. I am not sure whether the UK break-up party, formerly known as UKIP, would agree but there is just a chance that the UK has a future. Your Lordships will understand that I come from Northern Ireland, while several noble Lords here come from Scotland. We are worried that there is no such future. However, even in the event of break-up there will still be an interval after the current legislation expires in December during which the security of the UK remains a proper concern for us in this House and this Parliament—and thereafter, who knows?
The Bill comes to us after extensive preparatory work, which has been much mentioned. I, too, declare an interest as a member of the Royal United Services Institute working party that produced one of the reports before the parliamentary scrutiny began. However, further consideration is still relevant, because these are complex matters.
Like many noble Lords, I think that the fundamental architecture of the Bill is sound. There is good reason why the rights to liberty and security form a single right in the European convention and elsewhere. Liberty and security are inextricably interconnected and are matters that must be specified in ways that are mutually qualifying. It is also good to see the right to privacy—of course another qualified right—taken so seriously.
One of the reasons why it is so hard to draft good legislation in this area—and on this occasion I must congratulate the parliamentary draftsmen on the Bill and the excellent Explanatory Notes, which is something I do not often say—is that so many people start with quite obsolete views of what is at stake. Many people imagine that what has to be controlled and regulated is surveillance or intrusion or spying or, to use a well-known word that has been mentioned already, snooping, hence the populist phrase “snoopers’ charter”. That view is archaic. Of course there are still episodes of snooping and intrusion, but what we are trying to regulate in the era of big data is inference, and that is much harder. We are trying to regulate moves that enable inferences to be drawn.
It can be helpful to keep three rather simple questions apart. The first question is: are other people actually gaining access to private data about me? That is the sort of question that worries people, and the answer is usually not and, in particular, not to information that those other people are going to know is about me. The question perhaps reveals either a bit of paranoia or a bit of vanity, but it is quite common.
The second question is, “Can people gain access to private information or data about me?”, and the answer is that usually they can. They do not, but they can. Mostly, of course, they will not realise the data are about me. They can, and that is true not just of the security services but also of many others, and I will come back to that.
The third question is the one we are dealing with and is: may people gain access to data about me? It is only this third question that the Bill seeks to address, and then only with respect to a limited range of public bodies. It seeks to regulate the investigatory powers of the police and the security services assuming that possibilities of inference, and so of disclosure, have been multiplied by the new technologies. The Bill does not seek to regulate the same activities when undertaken by other parts of the state or by non-state actors, such as internet service providers or the media.
There are therefore parallel questions, and I want to raise one, which other noble Lords have also raised, about the media. Many of us have received briefings from the National Union of Journalists about special protection for journalists so that they do not have to disclose their sources and are protected from investigation. I understand very well the concern that this raises, and my noble friend Lord Colville spoke very eloquently about it just now, but I am worried about whether it can be effectively drafted. The Bill currently provides for two special cases of privileged exemption from investigation: for legislators and for legal professional privilege. Both are quite controlled exceptions. We can tell who is a legislator and who is lawyer and when a lawyer is engaged in the relevant discussions with a client. I expect that a claim for journalistic privilege may be tabled, and I wonder whether Her Majesty’s Government have thought about the issues that should be approached and the questions that should be answered. Is every blogger and tweeter a journalist? Other noble Lords have raised that question too. If not, where is the line to be drawn? Secondly, what protection would Her Majesty’s Government think appropriate to prevent the use of claims of privilege in cases where, unlike the Winterbourne investigation, there is no source but only fabrication? Does not freedom of public debate depend on the possibility of testing media claims? Does soft power too need to be accountable?
This is not the Bill to address these issues, but they need addressing. There is a need to address parallel issues about intrusion into private matters by non-state actors, including businesses and the media, that use these new and powerful forms of data analysis. I believe that the new data protection regulation that has finally completed its passage in Brussels is a rather superior document to the data protection directive on which our Data Protection Act is based. It is a pity of course that it does not come into force until 2018 and that we may not have the benefit from it.
My final word is on whistleblowing. Whistleblowing is not a matter of sending poison pen letters: good whistleblowing works when there are proper structures in which there is a confidential intermediary who receives the whistleblower’s message. The media are not the people to handle good whistleblowing. We need, on the contrary, to require major institutions to have proper whistleblowing structures. Some do and many do not—it could be done.
Baroness Hamwee (LD)
My Lords, my noble friend Lord Paddick remarked to me the other day that investigatory powers should be intelligible to a 70 year-old computer-illiterate grandmother. I did wonder whether he was talking about me—although I have to say none of those characteristics applies—and was also quite concerned that he thought 70 was old, but I realised that his comment was very apt. Transparency does not mean being able to see through something but means that you should be able to see the thing itself, and know it and understand it in the context we are discussing. Every Bill throws up its own lexicon: transparency is one item in it for this Bill, as is balance, which has been mentioned several times tonight.
I am not sure we should be in the business of “balancing” privacy and security. The term “binary” has become quite common, but for these Benches, privacy and security are not binary or mutually exclusive—a point I think the noble Lord, Lord Rosser, made right at the beginning of the debate—and our aim must be to achieve both. However, we are bound to discuss privacy more than security, not least because of the old dilemma, which my noble friend Lord Oates referred to, of what an Opposition, the public and perhaps also Ministers can say in response to, “If you knew what we know”. My noble friend Lord Strasburger made a very big ask of Ministers about unacknowledged knowns and indeed unknowns. I do not want to avoid acknowledging the crucial importance of security, so will say that we are part of what RUSI called the,
“near-consensus in public opinion that there are circumstances in which law-enforcement agencies … and security and intelligence agencies require sensitive capabilities to obtain communications in order to safeguard national security, investigate crimes and protect the public”.
But that is the beginning of the story—my words, not RUSI’s—not the end.
Ministers must be in an unenviable position. It must be hard to have the agencies saying, “Yes, please”, to more and more information—of course they will say that. But does quantity affect quality and workability? I confess I have long had a mental block about these issues. I am not computer-illiterate, but neither am I very computer-literate. My lightbulb moment—or one of them, the other coming when I read the Library Note, which, I should like to put on record, was admirably clear—was when I realised that it was not entirely my fault that the technical language was blocking my thinking about the underlying issues. Language should clarify, not impede, debate and scrutiny. That is not a criticism of the drafting of the Bill, but more of the commentary around it.
There is a consumer rights issue in this as well. It is very odd and disconcerting that after you casually look something up online, you are prompted to pursue it by advertising of the product or service. I say to the noble Baroness, Lady Liddell, that I am not exalted. I appreciate the commercial realities of this, but how many people realise that in the small print, which they did not read, they have consented to information being passed on to third parties? What do you do if you read it and do not like it? Do you cut yourself off from an essential modern tool? Public services, which we are talking about—not commercial services—must be better than that.
It is particularly important to me that the citizen, who is more than a consumer, is made aware of having been subjected to the use of powers. You may be part of a large group targeted—I use the term technically—although not suspected. I say that because the corollary of the right to know is the right to challenge. Those who are entrusted with oversight need the structure and criteria that enable them to make a proper assessment.
I still have a problem with the judicial review principles, and indeed I wonder whether the filter provided by the Bill is just another mechanism to collect information, but we will come back to all that.
In the Commons, the Government made a number of commitments to consider further amendments, including commitments made to the chair of the Intelligence and Security Committee, and the noble Earl referred to several amendments that we may expect. It is important—I hope we can hear this tonight—that the House knows from the Government when they will publish their amendments or, conversely, that they inform us that they will not propose amendments on the issues they have raised and on which they have given assurances that they will consider various matters.
The Joint Committee on Human Rights—like the noble Lord, Lord Henley, I am a member—has also reported. As the noble Lord said, “due course” will bring more comments on that. The committee acknowledged that the Bill represents a significant step forwards in human rights terms, but many human rights are engaged—privacy, freedom of expression, the protection of personal data, and freedom of association, assembly, religion and movement—and any interference must of course be in accordance with the law, not only with a clear legal basis but sufficiently specific to guarantee against arbitrariness. It must also be necessary in the pursuit of a legitimate aim, as well as being proportionate. I agree with my noble friend Lord Campbell and the noble Lord, Lord Reid, that this is not a constant: life changes. That leads me to the adequacy of the safeguards, especially as the regime has not been given the cleanest bill of health by a clutch of UN special rapporteurs or the Council of Europe Commissioner for Human Rights.
However, it is not only the legislation but how the powers are used that is critical. For me, the codes of practice are less important to this debate because, as has been said, they are not amendable by Parliament, and indeed Parliament is dependent on others to check compliance with them. There is a limit to the Executive’s accountability. Accounting for one’s actions is empty if the actions themselves are not explained. As I understand the Bill, the Executive’s own proposals gag the Secretary of State with regard to that accountability.
The safeguard of and public interest in, as my noble friend Lord Thomas of Gresford put it, legal professional privilege is something that I feel particularly strongly about as a lawyer, although I have never had to get my feet wet in the cause of it. As we are all potential clients, it was predictable that it would receive a lot of attention today, and it will receive a lot in the following stages of the Bill. By some distance, we have not yet dealt with the issues of what my noble friend Lord Lester called the potentially chilling effect.
Similarly, as a politician and a citizen, I am concerned about safeguards for journalists and journalistic material. That may be the definition to pursue, but I acknowledge that there are difficulties around definitions. Journalists’ work may not all be in the public interest but much of it is, and there is a clear public interest in protecting journalistic sources. There will be a number of issues to cover, particularly internet connection records, from the point of view of service providers as well as the public. The noble Baroness, Lady Neville-Jones, referred to the intelligent and constructive engagement of the providers, and they still have significant concerns. I was interested in the points they made in briefings about extraterritoriality and the international regime, or lack of it.
And we will have the review of bulk powers, which, as the Minister says, will become more important than ever. The terms of reference for the review make it a matter for the Prime Minister as to whether the review is published. I think it would go against the spirit of the review if it were not. Tributes have been made, and rightly so, to David Anderson. I wonder, who would be David Anderson? What a responsibility we place on his shoulders. It is not for us to comment on Commons procedures, but Members of the House of Commons will not have a chance to propose amendments to the Bill in response to the review of bulk powers unless we amend it and give them that chance.
When the draft Bill was published, I worried that I was not sufficiently worried. Over the years, talking on the phone to a friend whose work has been closer to the security world than mine has ever been, we have joked about some odd interruptions and noises and said things like, “I hope whoever’s listening finds this interesting”. However, when I realised that the regime extends from what I do to who I am—my legal secrets, as my noble friend Lord Macdonald put it—my concerns fell into place. My noble friend Lord Carlile’s phrase “the legitimacy of use” is very helpful here. As I say, we will focus on internet connection records.
I said that our task is about achieving privacy and security. The next few months will be turbulent politically. Where we will end up, who knows? This certainly suggests to me that perhaps we should not wait five years for a review of the Act that this will become. Whatever the turbulence—or “disarray”, which was the rather more polite term used by the noble Baroness, Lady O’Neill—we must not be diverted from the task in “the age of anxiety”, in the phrase of the noble Lord, Lord Hennessy, and, in that of the noble Baroness, Lady Harding, in the “civilised digital world”. It is an important task.
Baroness Hayter of Kentish Town (Lab)
My Lords, we have had a rich stream of expertise today, including from those who have served on the pre-legislative scrutiny committee as well as on the ISC and the Joint Committee on Human Rights. We have heard from colleagues who have operated the powers over security or crime, from colleagues who are expert in the legal world and from others who have reported on these matters, as well as from a couple of spooks. We have been reminded of the challenges we face as a society: to keep us safe and to protect our privacy while maintaining a way of life that we cherish and enjoy.
There have been the cases of Fusilier Lee Rigby; the Jewish grocery and school in France; British tourists just a year ago on Sousse beach; museums in Tunis and Belgium; music cafes and sports arenas in Paris; transport in London; the French police; Charlie Hebdo journalists in Paris; gay clubbers in Orlando; deadly bombers in Brussels airport and the metro; children, sadly even babies, abused; missing children here and abroad; guns and drugs smuggled on to our shores or bought on the internet; people trafficked; and organised crime with international connections.
Women are often harassed and stalked. Lily Allen described the massive and incredibly disturbing impact of that, much of it via social media, while our own much-loved and missed Jo Cox had been harassed by a stream of messages over three months.
So we cover just about everybody. Jews and Christians, Muslims and non-believers, straight and gay, men and women, MPs, journalists, police and clubbers; at work, at play, on holiday, shopping, travelling, at school—all have been targeted by those who mean harm. Unfortunately there are people and organisations who would hurt not only us but even people who are far more vulnerable than us.
So we have an obligation to halt that harm and stop it happening. The problem is not new. As my old supervisor, the noble Lord, Lord Hennessy, reminded us, it goes back to John Stuart Mill’s day—that desire to protect our privacy and ensure that the state does not take on intrusion which breaks the precious contract between people and government.
It is for this reason that, in examining the Bill to see whether the balance of security and privacy has been achieved, we welcome the new and overarching Clause 2, which says that in exercising its powers, the relevant authority must consider the issue of privacy. This requirement is even more necessary given how society now functions. Indeed, I sometimes feel that I am watched all the time—and by private companies, as my noble friend Lord Rooker reminded us. My phone records where I am, to whom I spoke, which websites I visited, and even how many steps I take each day. Between that, my credit card and Oyster card, CCTV and my entry fobs, everything I do and every step I take is known to someone.
It was rather different when I was growing up. We used to chat in pubs, at the school gate, at work, in the kitchen, at church, in college, in clubs, at the hairdresser—or I suppose the barber, for some noble Lords. We sent postcards, even Valentine’s cards, and telegrams, we kept our appointments in diaries or in a Filofax, and we gossiped on the phone. Today we use social media—web chats, texts, apps—for all that, as if it is a private sphere, and we talk about our loves, fears, dreams, frustrations, job applications and misdeeds, our thoughts and opinions about our friends and neighbours, and even about our politics. Even wider than what we do with our friends, we trust our doctors, lawyers, priests and indeed journalists to keep our secrets safe and secure. So while we rightly demand that our security is safeguarded, we also want and expect what we think of as that private world to be safeguarded.
As we have heard today, in the Commons there was, perhaps unusually, thorough debate, as well as the willingness of the Government to listen and respond. We have all been helped by the expert input from my honourable friend Keir Starmer, the then shadow Home Office Minister, which helped make considerable progress in improving the Bill, such that Labour could support it at Third Reading.
The Government’s establishment of the Anderson review of bulk powers, the moves on a higher threshold for medical record access, the double lock for major modification of warrants, the exclusion of normal trade union activity from interference, and the requirement for judicial commissioners to give weight to the overarching privacy clause have all made our task so much easier. We will of course look carefully at what David Anderson, assisted by his expert colleagues, finds regarding bulk powers, and will respond as necessary. There are other issues we will want to finesse and probe before we finally sign the Bill off—in particular the threshold for ICR access and a determination of what is “serious”.
We also need to safeguard further the ability of clients to rely on their lawyers’ discretion when they talk to them, and we need to refine the protection of journalists’ sources. We must give people the ability to speak without fear of identification. It would not be in the public interest for such risk to silence those we want to speak out. We look forward to the outcome of the Government’s discussion with the Bar Council, the Law Society and CILEx on the former issue and to their talks with the NUJ and the Society of Editors on the latter, as well as on the definition of who is a journalist. Maybe it is somebody reporting for outlets covered in any way, shape or form by some sort of regulatory system. Of course, that raises the question of whether the Government will ever fully implement Leveson.
However, much has been achieved. We welcome the consolidation of the existing powers in a transparent form, as well as the creation of the IPC and the double lock, and the involvement of the IPC or judicial commissioners not just in decisions but in monitoring and review.
We welcome the recognition of the role played by parliamentarians, journalists and lawyers in giving voice or protection to others, with the confidence for those citizens that the privacy of those exchanges will, with only very rare exceptions, be safeguarded. We will want to test the current wording on these sensitive professions, as the Bill perhaps has not yet achieved the right balance in protecting the privacy of those who need it most.
We welcome the “no prosecution” undertaking for whistleblowers who have used the channels provided. We welcome that urgent warrants will be speedily reviewed and, if necessary, cancelled by a judicial commissioner.
We welcome the involvement of the PM in access to parliamentary material, and the avowal and updating of the Wilson doctrine. Also welcome is the introduction of civil liability for unlawful interceptions—although we also heard views today about whether there is a sufficiently serious offence for anyone who wilfully misuses the powers in the Bill. We may want to return to that.
We need an answer from the Government to the question that my noble friend Lady Smith put to the Leader of the House today, to which she got no response, and which was repeated by my noble friend Lord Rosser at the start of this debate. Given that we will leave the EU, are changes now needed to the Bill to retain the close working relationship we have with those allies, with whom we will now be in a slightly different relationship?
As we have heard, there is rarely a right or wrong balance in the situation that we face. We want security and we want our privacy, civil liberties, respect for human rights and confidentiality. We have still to assure ourselves that this Bill has quite the right answer, although great progress has been made. That is what we will seek to achieve as we scrutinise the fine print in Committee. We look forward to working across the House on that aim.
The Advocate-General for Scotland (Lord Keen of Elie) (Con)
My Lords, this has been an interesting and thought-provoking debate, which has benefited from the considerable expertise on all sides of this House. I am grateful to all those who have contributed. In particular, I welcome the contributions from those opposite. This reflects the constructive approach that has been taken to the Bill right across Parliament.
Indeed, I recognise the consensus on all sides of this House that new legislation is needed to make the use of these powers clearer and more transparent. We have an opportunity now to ensure that the security and intelligence agencies and law enforcement have the powers they need, and to strengthen the safeguards and oversight that govern their use. The list of speakers this evening is testament to the importance of this issue.
Mention has repeatedly been made of the need to balance privacy and security. There have been references to the privacy of the innocents, but one must also take account of the protection of the innocents. As the noble Baroness, Lady Liddell, observed, one of the primary human rights is the right to life, and without that the others fade into insignificance.
A number of issues have been raised in the course of this fairly lengthy debate. If I am short in responding to them at this stage, it is not because I consider those contributions slight but because I am constrained by time.
The noble Lord, Lord Rosser, raised the question of EU co-operation, which has just been revisited by the noble Baroness, and whether that would impact the present Bill. There is, of course, no immediate change to our relationship with the EU and it is not considered that any changes are or will be required to the Bill by virtue of recent developments. Of course, negotiations will take place over the coming weeks and months with regard to our situation and the EU, and these will clearly need to take account of our security and the need for cross-border co-operation in the area of security and the need for further co-operation beyond that. But let us remember that we already co-operate with many countries beyond the European Union in matters of security. Noble Lords will be familiar with the “Five Eyes”, which includes the United States, Canada, Australia and New Zealand—none of them connected with the European Union. So it is not considered that that will be an issue for the Bill as it proceeds.
The noble Lord, Lord Rosser, also referred to the undertakings and commitments that have been given in the Commons with regard to the Bill. Of course, we will meet those commitments and undertakings. We fully intend to bring forward a number of amendments. We intend to have those amendments available by 4 July.
There are remaining issues, of course, that will be the subject of further debate. The noble Lord, Lord Rosser, made reference to such issues as the privacy clause, which is now expressed in the Bill and the Bill is improved because of that; the express provision on trade unions—again, the Bill is improved because of that; and the question of dealing with whistleblowers’ protection, which the Solicitor-General alluded to in the other place. Again, we will meet our commitments with regard to these matters.
I turn to some of the observations of the noble Lord, Lord Paddick, which were supported to some extent by the noble Lord, Lord Oates. He concentrated in particular on internet connection records and something that he referred to as a draconian power. I noticed that the noble Lord, Lord Condon, alluded to these powers and was at pains to point out that they were not extending any boundaries but maintaining them. I would go further: these powers are actually restoring a boundary that had been lost as people moved away from conventional telecommunications. There was a time when police powers in regard to conventional telecommunications would provide them with the datasets they required, particularly in the context of evidence gathering and prosecution.
I pause on that note. The noble Lord, Lord Paddick, suggested that recourse could be had to the powers of the security services rather than in gathering ICRs. But of course that is neither practical nor effective because many of the powers of the security services produce investigative material that is not admissible as evidence in a court of law. Therefore, one has to be careful about how one confuses the powers of the security services to gather and investigate and the powers that are conferred upon the police in the context of internet connection records.
With regard to the security of that material, the noble Lord, Lord Oates, raised a number of questions, some of which puzzled me a little. What I will say is this: clearly, the data are retained by the service provider and those service providers are bound by various data protection obligations with regard to the security of those data, and that will continue to be the case. As regards the period of retention—12 months—that reflects the requirements of the police in the context of the sorts of investigations that are carried out by reference to these kinds of data; that is, telephonic communications data and the like.
So far as cost is concerned, the noble Lord, Lord Paddick, cited a figure of £1 billion. I know not where that figure came from, but the considered opinion of the Government is that the cost will be in the region of £174 million over 10 years. Of course, that cost is not to the service providers but will be met by the Government where it is reasonably incurred by the service providers when and if they are required to retain the relevant data.
The noble Lord, Lord Paddick, also referred to the request filter as a database and said that it was therefore vulnerable. The request filter is not a database; it is simply a filter. It is a further safeguard because it will operate in such a way that where a mass of data are returned by a service provider they will go through the request filter, and the relevant authority will receive only the data it requested and no additional data, notwithstanding what the service provider may have made available. I hope that answers the points raised by the noble Lord, Lord Paddick.
I will not be able to answer every query that has been raised today. If at the end of this evening there are any points that noble Lords feel I have not responded to and wish me to do so before Committee, they should allow my office to be aware of that and I shall arrange to write to them on the particular topic. I say “my office” in response to an observation from one of my noble friends who said that there was no Home Office Minister here. I had understood that I was here in the capacity of a Home Office spokesperson. If I am not, I want to know why I have been answering all these questions for the past four weeks.
The noble Lord, Lord Paddick, also referred to the RUSI 10 tests, which were alluded to by the noble Lords, Lord Hennessy and Lord Rooker. Professor Michael Clarke, the then director-general of RUSI, gave evidence to the Joint Committee that scrutinised the draft Bill. He said:
“As Chair of the RUSI panel, I can say that the Bill met most of our expectations in terms of the recommendations that we made”.
The noble Lord, Lord Rooker, made the sensible suggestion that we should consider producing a paper in which we set out the Government’s response to each of those 10 points. I hope he will understand what I mean when I say that we will take that and give it due consideration.
The noble Lord, Lord Pannick, raised the question of legal professional privilege. He was joined in these observations by the noble Lords, Lord Lester, Lord Beecham and Lord Thomas. I notice that, in his account of his experiences, the noble Lord, Lord Thomas, did not say what happened to the bag of money but surely we can infer that it remained where it was. I fully accept the analysis of legal professional privilege that has been advanced by each of the noble Lords. The present position is this: I am due to meet representatives of the Bar Councils and the Law Societies this coming week to discuss the scope of the provisions within the Bill with regard to legal professional privilege.
The noble Lord, Lord Pannick, was right to observe that there is one problematic area—the question of when and to what extent there should be access to LPP material in circumstances where there is no iniquity. There may be very exceptional circumstances in which it is critical in the context of an immediate investigation that some data should be recovered. That will be addressed and we will bring forward our finalised position in due course.
There was also the question of journalistic privilege. This has been clouded by a misunderstanding on the part of many journalists as to what, if any, privilege they actually enjoy, in particular the belief that whenever security services sought information from a service provider they would be given notice of that. That is not the case. It is not the present law and it is not realistic that that can be law. However, again, this will be addressed going forward.
In addition, of course, we have to address the question of what is a journalist. I believe one noble Lord on the opposition Benches said that could be defined normally by waving an NUJ ticket. That is no longer the case and virtually every blogger on the planet would claim to be a journalist of one kind or another. It is a very serious issue and we will seek to address it.
The noble Lord, Lord Blunkett, mentioned the necessary balance between liberty and privacy and again underlined the need to balance the privacy of the innocent with their protection.
The noble Lord, Lord Strasburger, raised a number of issues. I shall not repeat what I have already said about internet connection records or the request filter. He also questioned whether the provisions of the Bill would somehow threaten, as he put it, encryption. There is no question of that. The provisions of the Bill do not weaken encryption or threaten it. We do not seek what have sometimes been erroneously termed “back doors” into encrypted material. I would seek to dispel any such suggestion.
The noble Baroness, Lady Neville-Jones, raised questions about extraterritorial jurisdiction, as did the noble Baroness, Lady Liddell, and the noble Lords, Lord West and Lord Janvrin. The US Attorney-General recently indicated that discussions are ongoing to address conflicting legal obligations in circumstances where we seek the release by American companies of material. United Kingdom law is perfectly clear that companies providing communication services to users in the United Kingdom, irrespective of where they are based in the world, must comply with lawful requests and warrants from UK authorities. The ultimate power to deal with that would of course be contempt of court proceedings. We maintain that right to extraterritoriality. In response to a further point made by the noble Baroness, Lady Liddell, I should add that we are satisfied that the provisions of the Bill comply with and meet our international legal obligations. Whether it sets a template for others is a different matter, but we are satisfied in that regard.
The noble Lord, Lord Lester, raised the question of legal professional privilege. He also referred to the position of the IPC and to the “commission”. I should be clear that in terms of the Bill there is no commission; there is a commissioner. However, the commissioner has the express power to seek independent legal advice as and when required. I believe that another of your Lordships referred to the commission. It is not a commission; it is the commissioner.
Lord Lester of Herne Hill
I am grateful for what the Minister has just said, but will the Government consider, as David Anderson has suggested, that there should be a commission endowed with the kind of powers that he has recommended?
Lord Keen of Elie
I note the observation. The position of the Government is that it is appropriate that there should be a commissioner and that it is not necessary that there should be a commission. Clearly, this matter can be revisited in Committee.
Thematic warrants were mentioned by the noble Lord, Lord Lester, and my noble friend Lord Lothian. Thematic warrants are considered vital to investigate complex and fast-moving threats, and they are currently provided for under RIPA. The Bill simply clarifies and strengthens the safeguards around the operation of thematic warrants but, again, if there are issues as to their scope, they can be revisited in Committee.
My noble friend Lord Lothian and the noble Lord, Lord Janvrin, raised the question of bulk personal data. The Government accepted in principle the argument that we should provide further restrictions on the use of class BPD warrants and should take into consideration some of the detail contained in the ISC’s draft clause. The Government intend to bring forward some amendment on this—again, I indicate that it should be available by 4 July.
My noble friend Lord Lothian also mentioned additional offences being incorporated into the Bill. It is considered that the changes made to Part 1 make clear the criminal offences that apply. The Bill also creates a new offence for the acquisition of communications data without lawful authorisation. Beyond that, it is not considered appropriate to introduce further criminal offences into the Bill at this stage.
Questions were raised about the double lock, of course. The position of the Government, and I believe that of the Opposition, is that we have now arrived at a suitable position in this respect, but it is important that the judicial point here should be subject to a test of judicial review. It would not be appropriate for a judge in these circumstances to revisit the merits of a decision, and I hope that that will find wider support in the House in due course. In the end the Secretary of State must be answerable to Parliament for the warrants for these intrusive powers, and that is allowed for.
In the context of warrants, the noble Lord, Lord Evans of Weardale, raised the question of speed of operation. There is provision within the Bill for an emergency warrant to be issued by the Secretary of State and then be the subject of review by the judicial commissioner. It is hoped that speed of operation will not be challenged by the terms of the Bill going forward. The noble Viscount, Lord Colville of Culross, mentioned in the context of journalists the matter of notification of warrants. As I indicated, that is not the present law and it is not considered a realistic way forward, but again I anticipate that that may be considered in Committee.
Modern legislation that consolidates and clarifies the powers available to the state to obtain communications and related information is, I believe it is generally acknowledged, badly needed now. That was the conclusion of three independent reviews and three committees of Parliament. The Bill achieves that aim. The threats we face are evolving and the ways in which we communicate are changing rapidly. The capabilities of law enforcement and the security and intelligence agencies must evolve and change too. It is Parliament’s responsibility to ensure that those charged with keeping us safe have the powers they need, governed by strong safeguards, strict protections and robust oversight. That is what the Bill provides.
The Government are clear that the Bill must command the support of Parliament and the public. It arrives in this House having been subject to extensive debate and examination in the other place and having received cross-party support and a resounding majority there. As we have done to date, we will continue to listen, to engage and to make changes that improve the Bill or strengthen its safeguards. We have the opportunity here to deliver world-leading legislation that provides robust oversight and powerful privacy protections. It is legislation that is clear, comprehensible and legally sound. It will provide the men and women of our law enforcement and security and intelligence agencies with the powers they need to keep us safe. I commend the Bill to the House.