Baroness Donaghy
That the Report from the Select Committee Registration of members’ foreign interests: follow-up (9th Report, HL Paper 255) be agreed to.
Baroness Donaghy (Lab)
My Lords, I am moving this Motion as a member of the Conduct Committee on behalf of the noble and learned Lord, Lord Mance, because he has interests relating to the contents of the report and therefore recused himself from deliberations on it. I declare my interest as a former member and acting chair of the Committee on Standards in Public Life. The current chair of that committee, the noble Lord, Lord Evans of Weardale, regrets that he is unable to speak today but has confirmed that he is supportive of the committee’s proposals.
This report is the final piece in a jigsaw of changes that we have put to the House to increase transparency around Members’ overseas interests, reflecting considerable public concern about foreign state influence on our politics and the integrity of our political process. In December, the House approved our proposal that Members should be required to register work for, and earnings from,
“governments of foreign states (including departments and agencies), organisations which may be thought by a reasonable member of the public to be foreign state-owned or controlled, and individuals with official status (whether executive, legislative or judicial) in foreign states when acting in that capacity”.
This is now part of our code, so Members must register the existence of such relationships within one month of them starting, and the level of remuneration within the slightly longer timeline set out in the report.
The one remaining question was whether there should be any exemptions to these requirements on the grounds of professional confidentiality. We gathered evidence to help us make a decision by holding a consultation of all Members and inviting submissions from the professional bodies. Some of the responses did point to a professional duty of confidentiality, but all of them accepted that the information could be disclosed if the client agreed.
That is why we have said two things very clearly: first, any professional relationships with foreign Governments and associated organisations which existed on the date the report was agreed—2 December last year—will not be caught by the new requirements at this stage. Members in such a position will have the whole of 2021 to complete the work, reach an agreement with the client about disclosure, end the relationship, or take leave of absence.
Secondly, any new such professional relationship commencing after the report was agreed in December will be embarked upon in the full knowledge that it will need to be disclosed, along with the level of remuneration. This is a prospective rule, so Members should be telling potential clients that they will be obliged to make these disclosures if taken on. If the client accepts this, then no professional duty of confidentiality will be breached.
Some Members say that this will damage their chances of winning business. Even within each profession —in particular, the law—there are different views on whether this is really true. If some Members lose some work, that is regrettable, but these requirements apply to only a very narrow range of organisations and the committee has made it clear in its report that it has no intention of extending them to a broader range of organisations. This is in spite of the fact that Parliament’s Intelligence and Security Committee recommended that Members of this House should be required to disclose all earnings in the same way as Members of the other place, a position which is also espoused by the noble Lord, Lord Balfe, in his amendment to my Motion.
Our reason for restricting the reach of our proposals is that, in our view, foreign Governments and organisations under their control are qualitatively different from other types of organisation. For a legislator in the United Kingdom Parliament to be secretly working for a foreign power, whose interests may be diametrically opposed to the UK’s, is just unacceptable to the public in this day and age. It is not just about Russia, as some have implied; even close allies like France and the United States sometimes have an agenda which is at variance with the UK’s national interest.
Furthermore, it is not just about dodgy lobbyists. I accept that lawyers and arbitrators see no connection between their being paid by a foreign Government and what they might say in the House, and this may be accurate. Many people, however—perhaps most—would say that there is at least a suspicion that a Member being paid tens of thousands or even hundreds of thousands of pounds might be a little more kindly disposed to the organisation paying them than they would otherwise be. It is not just about being beyond reproach in practice; it is vital for our democracy that, wherever possible, Parliament is seen to be beyond reproach. Being a legislator is a privilege, and with that privilege comes an obligation to be transparent. In the view of the committee and many others besides, the public interest must trump Members’ private interests in this instance.
It may be helpful if I address at this stage the proposed amendments to my Motion. The first says that we are going too far, while the second says that we are not going far enough. This suggests that the committee, which has spent many hours deliberating on this issue over the past year, has struck the right balance. Unless, therefore, any new and compelling arguments are made today, I am not minded to accept either amendment. I do, however, wish to assure the House that, if the report is agreed today, the Conduct Committee will carefully monitor its implementation and be open to representations in the light of experience. As always, the Registrar of Lords’ Interests is available to advise Members on how to comply with the rules, and he will also be able to convey feedback to the committee. I look forward to hearing the views of noble Lords today. I beg to move.
Amendment to the Motion
Lord Garnier
As an amendment to the Motion in the name of Baroness Donaghy, to leave out all the words after “that” and insert “this House thanks the Select Committee for its Report Registration of members’ foreign interests: follow-up (9th Report, HL Paper 255), but returns it to the Committee for further consideration.”
Lord Garnier (Con)
My Lords, I begin by thanking the noble Baroness, Lady Donaghy, for introducing this debate. She brings to our proceedings a decade of experience in your Lordships’ House, but also valuable experience gained from her work outside Parliament. The noble Baroness has been an administrator at two universities; has had senior roles in the trade union movement, including as president of the TUC; has chaired ACAS and the Committee on Standards in Public Life; has been on the Low Pay Commission; and has undertaken an inquiry into work-related deaths in the construction industry. In the noble Baroness, we see why this House is what it is and why it works, and why we need to be cautious about disabling Members of this House from participating in its work.
The House can draw on the experience of people from every corner of the country and walk of life. Some are politicians and former Members of the other place, and some are from the professions, religious ministry, academia, public service in government, the Armed Forces and the judiciary, or business or rural affairs, but we bring to this House our own individual and conjoined experiences, which inform the arguments we deploy in what we believe to be the best interests of the country and its governance.
I dare say that today’s task is not one that the noble Baroness had longed for since her arrival in this House. I am not exactly ecstatic about moving my amendment, but I hope to provide a bridge across which the House as a whole can travel in a spirit of mutual respect, thoughtfulness and compromise. I move this amendment not in a spirit of criticism but of collegiality. I want the problem identified by the Intelligence and Security Committee and the Conduct Committee dealt with in a way that satisfies, on the one hand, the interests of your Lordships’ House—one self-governing half of this bicameral Parliament—and, on the other hand, the public interest that parliamentarians do their work unsullied by insidious external influences.
There is another linked but fundamental question: should that which could lead to a change in the constitution of your Lordships’ House come about as the result of a recommendation of a committee comprising of four lay members and four Members of this House? Is not the altering of the constitution of the House, and thus of Parliament and the country, a matter for legislation to be considered by Parliament as a whole? To follow the committee’s recommendations now is to set them in stone—I have heard what the noble Baroness said, but I believe that it will set them in stone—but if we hold off a while, we can still agree with her later.
I refer to my own interests in the register, although I stress that this debate is not about me but about the House of Lords. Although I am a barrister in chambers that do a great deal of commercial arbitration and litigation, some of which involves overseas companies, Governments and government agencies, the international element of my own practice has only occasionally involved advising foreign governments or agencies. Mostly, it involves advising foreign companies or private individuals and, in cases involving the European Court of Human Rights, acting against foreign Governments. In this jurisdiction, I have acted both for and against the Government, and have even had the experience, while representing a former Prime Minister, of referring to the current Prime Minister as “the defendant” and subjecting him to sharp criticism in open court. I am also a consultant to an international firm of solicitors which, among other things, advises not only the United Kingdom Government but foreign Governments. I have worked on those matters but, as I do not know what the firm charges its clients, I have no idea how I could apportion my retainer, which also covers work not caught by the follow-up report.
It would be naive not to realise that this debate has been affected by perceptions and, perhaps, the reality of misconduct in public life. There is obvious public concern, lately aired in the media, about what is called the Greensill Capital affair, but it has nothing whatever to do with this debate, or what concerned the ISC in 2020 or the Conduct Committee this year or last. But that concern is a powerful reason why I suggest we postpone consideration of the committee’s recommendations on the disclosure regime that it seeks to impose upon your Lordships’ House. The chairman of the Commons Public Administration and Constitutional Affairs Committee has announced an inquiry into lobbying. There is the Boardman inquiry, and the noble Lord, Lord Tyler, has a Topical Question this Thursday. Of course, none of this was in the minds of the Conduct Committee, but its reports are being read as though it was. I suggest that a pause will assist, not prevent, proper consideration of the follow-up report.
Our consideration of the questions posed by the report will, unless separated by a margin of some months, be skewed by two elided questions. They describe conflicting matters of public interest, but we are being asked to resolve the conflict in a rush and against a difficult backdrop. Our task is by no means impossible and we can do it if, as a House, we give ourselves time to think it through.
First, should Members of your Lordships’ House who are not doctors but, for example, lawyers, architects, accountants, or practitioners in other entirely legitimate areas of work, have to identify and declare their earnings from foreign Governments or foreign government entity clients, thus having to choose whether to break their obligations of professional confidence, or stop working in order to remain here, or take leave of absence or retire from the House altogether in order to carry on with their lawful professional lives? Secondly, how does this House prevent its Members acting as the covert mouthpiece of a foreign Government, particularly one whose interests conflict with those of our own country?
We do not need to compel the former in order to prevent the latter. As recognised by the ISC, our country is a target for Russian disinformation. There will be other malign state actors too. We cannot be complacent about hostile states deliberately trying to influence our democratic processes, but making me say whether I have advised an EU member state’s justice ministry or a Commonwealth country’s law commission about the English deferred prosecution agreement system, and what I was paid to do so, is not going to stop President Putin suborning our democracy.
This amendment is not an excuse for a lawyers’ whinge, nor was it tabled to criticise any of your Lordships who have chosen, for whatever reason, not to engage in paid work outside Parliament. But nor should my amendment be dismissed out of hand just because lawyers, but others too, will be affected by the report’s proposals. We are an unsalaried House, and I am sure that everyone contributing to this debate has the interests of Parliament and the public in mind.
In June 2020, the Conduct Committee made recommendations about Members’ earnings from foreign Governments, dealing with corrupt or repressive regimes, and restricting parliamentary activities by those who had been on overseas visits paid for by a foreign Government. But that was all about lobbying, and mirrored the ISC’s concerns. With respect, being paid to lobby on behalf of Russia is quite different from being paid to advise or represent a client, albeit a governmental one, in a commercial or other legal dispute.
As Solicitor-General I was precluded by the Ministerial Code and by my professional obligations from saying whether I had advised my client, the Government, on a particular matter, still less what that advice was. If I now appear in open court, subject to an anonymity order, the need to keep confidential the name of my client falls away, but to require me to disclose their name on first payment, or in a matter that never reaches court, would place both me and my client in difficulty. To require the parties to an international commercial arbitration—a confidential way of settling disputes—to surrender their privacy, or to make it impossible for them to employ Members of this House as advocates or arbitrators, will not bother Putin. It goes much further than the rules of the other place, whose membership is salaried, with large office costs allowances, transport costs and a second home allowance. Let us pause and return to this soon, but later.
The Deputy Speaker (Baroness Pitkeathley) (Lab)
I should inform the House that if the amendment in the name of the noble and learned Lord, Lord Garnier, is agreed to, the amendment in the name of the noble Lord, Lord Balfe, will be pre-empted.
Lord Balfe (Con)
I suppose I should begin by saying that for a time I worked for David Cameron. Maybe I was foolish, but I did not get paid. I did it as a volunteer —but clearly I was working for him. I thank my Front Bench for sending round an email to all Members saying that there is a free vote on my amendment. I hope that that will encourage people to vote for it. I would be very interested to hear, in the course of the debate, what the other political groups are advising.
I tabled this amendment because the report came at an opportune time. When the noble Lord, Lord Bethell, was answering questions on the Statement, we heard from the noble Baronesses, Lady Thornton and Lady Brinton, complaints—justified, probably—that contracts had been let but not declared into the public space. And at the heart of my amendment are the words
“if the public are to be supportive of legislation, they have a right to know the full financial interests of legislators”.
The amendment then
“asks the Select Committee to examine the need for the House to adopt disclosure rules”.
It does not tell the committee to do that; it asks it to examine the need—nothing more than that—so it is quite mild. The committee could examine the need, then come back and say, “Look, it just doesn’t work.”
There are many other interests, as well as foreign interests. I have never been paid by any foreign Government, but I have a well-known aversion to certain aspects of Her Majesty’s Government’s foreign policy which I have made quite clear. I have made it clear because that is where my analysis leads me, not because anyone has tried to bribe me. I sometimes feel quite upset that I must be a very lowly species, because nobody wants to bribe me. I cannot even say that I turned a bribe down, because I have never been offered one.
What we have to look at is the perception of the politician by the public. It is not a happy perception at the moment: there is a feeling that we are doing quite nicely, without saying how. We must tackle that. The public have a right to know, in my estimation. I hear what my noble and learned friend Lord Garnier says about barristers, but the Bar Standards Board, in its evidence, says:
“The majority of barristers are self-employed, so it should not be difficult for most barristers who are Members to identify the fees paid to them by a client.”
I do not find it difficult to work out where my money comes from, and I have no difficulty about declaring where it comes from. In the interests of transparency, we should be looking at a system whereby people declare where their principal income comes from.
I am asking the committee to look into this because it is a complex issue. There are de minimis standards, and there are different standards of declaration. They need considering carefully, and they need to be brought before this House; they are not a suitable subject for an amendment. In paragraph 13 the report says that
“the public interest ultimately must override the issue of client confidentiality”,
and that is absolutely right—it must.
It is not unreasonable for us to declare what we are paid. We are legislators, and we are passing laws that affect people on a day-to-day basis. What is wrong with our declaring what we get? I have never found any difficulty with the present rules, so I do not see why any noble Lord should feel great difficulty with a new level of declaration.
Are we going to start telling the Government that we want to know what went on with Greensill? That is well worth a debate, because it reveals, to put it mildly, a lamentable situation in Whitehall which clearly needs addressing. But if we are to ask for that to be addressed, we must address our own situation. Our situation, too, deserves a level of transparency. That is all I want to see.
I will be dividing the House because I should like the public to see how many people do not even want a committee to look at this matter—not doing anything, but just looking at it. Since there will be a free vote on our side, I hope that there will be a free vote elsewhere. I hope that the noble Baroness’s committee will be asked to look at the matter and come back because if we are not prepared even to look at these sorts of matters, we are not fit to be telling the Government to reveal their secrets, which I want brought out into the open. I shall sit down and might move my amendment to the Motion later.
Lord Newby (LD)
My Lords, I start by reminding the House that the Conduct Committee was established as a successor to the former Privileges Committee. That earlier committee included Leaders and Chief Whips, and the view was rightly taken that a body distinct from the leadership of the House and with significant outside representation should take that committee’s place. The assumption was that the new committee would have an authority that the old committee lacked. It would have, by virtue of its external members, more professional experience and expertise, and there would therefore be a strong presumption that the House would accept its proposals unless it could be demonstrated that the committee had been in some respect negligent in the way in which it had decided upon them.
In this case, the committee has been diligent in the way in which it went about its task. It sought and received submissions from all interested parties and reached a considered view on how to proceed. That does not, of course, prevent your Lordships’ House rejecting the proposals or sending them back for further consideration, but if the House chose to do either of those things, it could reasonably do so only on the basis that something was seriously deficient in the way in which the committee had done its work that caused its conclusions to be legitimately brought into question.
The central conclusion and recommendation in the committee’s report is to be found in paragraph 8, which states that,
“we believe that the public interest requires absolute transparency when it comes to members of the national legislature working for a foreign power. If the interest cannot be properly disclosed, then it should not be taken on by an active member.”
If the House agrees with that statement it should agree with the report. So should the House agree with that statement?
What constitutes the public interest is often a matter of debate, rather than a black-and-white issue. In this case, there is absolutely no suggestion that any Member of your Lordships’ House who is a lawyer representing a foreign power has used their membership of your Lordships’ House in any way improperly. But that is not the question. The question is whether absolute transparency at this stage will strengthen the perceptions of your Lordships’ House or, just as importantly, whether a failure to approve this report now would damage those perceptions and, therefore, be against the public interest. That is ultimately a political judgment. My political judgment is that failure to pass this report today would damage our reputation. Here, the political context is crucial.
As we debate this report, the Commons is conducting several different inquiries into the rules around lobbying and the registration of ministerial interests. There are serious allegations about the role of the former Prime Minister, former civil servants and serving Ministers. Furthermore, the Government are planning, in the light of potential foreign interference in our domestic processes, to introduce a measure in the next Session requiring all those who work for foreign Governments, even only as PR advisers—not lobbyists—to register their connection formally. Every single aspect of the workings of your Lordships’ House, from the role of hereditary Peers and how much money they claim in expenses more generally, is under intense media scrutiny.
If, in this context, your Lordships’ House were to decide that, uniquely, lawyers who are Members of your Lordships’ House with clients who are foreign powers or their associated organisations should be exempt from registering their interest, this would damage the reputation of the House and would be against the public interest. I therefore believe that the report before us should be adopted today.
The amendment of the noble Lord, Lord Balfe, is slightly beguiling, because it says, “There are all these other things going on, so perhaps we should have a look at everything.” Unlike the implication of what the noble and learned Lord, Lord Garnier, said, the register and the guidance about how we behave is a living document; we amend it regularly. Deciding something today does not set anything in stone. I am sure the noble Baroness, Lady Donaghy, wishes it were not under such perpetual scrutiny. It will not stop being scrutinised or, I suspect, amended. The noble Lord, Lord Balfe, is slightly mischievous when he says that if we do not vote for his amendment, we are somehow saying that we think that everything is wonderful and nothing should ever be looked at again.
We have a good report before us today, which should be accepted. I agree only to this very limited extent with the noble and learned Lord, Lord Garnier: I think we should leave it at that. I do not think we should be going beyond that today. Let us do this and get the clarity which is currently lacking. If other things arise down the line which need to be investigated, the noble Baroness’s committee is perfectly capable of doing so expeditiously. My recommendation, which is personal—people have a free vote and I expect a robust exchange of views among members of my party, as on other Benches—is to vote for the report and against both the amendments.
Lord Brown of Eaton-under-Heywood (CB)
As many of your Lordships will know, I was a dissenting member of the committee concerning this report, and mine is therefore a somewhat unusual, perhaps somewhat delicate, position in this debate. First, let me make it absolutely plain: I have no interest myself in its outcome. Although I am of course a retired judge, it is more than 40 years since I had a private client, and never in my life have I arbitrated—and I am not starting now.
Secondly, I have a high regard and, indeed, considerable liking for the other members of the Conduct Committee, and I am certainly not about to rubbish them—only to suggest that on this particular issue, they have now come to a wrong decision and should think again. Their first thoughts were right. The original scheme was set out in our earlier report, already referred to, which I had no problem in presenting to the House in December, the chairman of the committee, the noble and learned Lord, Lord Mance, having had to recuse himself, as the House has heard. That report was strikingly different from what is now proposed. Put simply, this proposal, unlike its predecessor, would introduce an absolutist, no exception requirement of registration of any form of governmental or government-influenced earnings.
I will say a word or two about the origins of this proposal. These lie in a single paragraph of the ISC report of 2019, which noted that a number of Members of this House had business interests linked to Russia —that was the only state mentioned—and that those relationships should be carefully scrutinised, given the potential for Russia to exploit them. It suggested that the code and register should provide the necessary transparency, and then pointed out that the Commons requires registration of all payments over £100 from any employment outside the House, home or abroad, and that we should consider introducing such a requirement—essentially what the noble Lord, Lord Balfe, proposes for us today.
Finally, it suggested a foreign agents registration. I will make four quick points on that. First, I understand that a foreign agents registration Bill is now under consideration. Secondly, this House is very different from the Commons; your Lordships are not salaried or expected to work full-time for the House. Rather, we are encouraged to have a broad range of outside interests, financial and otherwise. The guide says that
“the House thrives on their expertise”
and that
“it is not only permissible, but desirable, that such Members, having declared”—
I emphasise this point—
“their employment and other interests, should contribute to debate on issues to which these interests are relevant.”
Thirdly, I suggest that most work undertaken by Members for foreign Governments is beneficial to the UK, not harmful. Members advise, for example, in the fields of good governance, tackling corruption and crime, and human rights compliance. Fourthly, whatever the outcome of this new registration proposal, there is always the clearest obligation for Members to declare any interest that could be thought to affect whatever they contemplate doing or saying in their parliamentary capacity. It is not suggested that this obligation has proved insufficient to this point.
I will briefly mention our earlier report, which I presented, in which the need for exemption was specifically recognised in cases where there is a duty of confidentiality. It was said that the Conduct Committee would consult further on what guidance to give on those exemptions. There was a consultation process, to which 42 Members responded; only three believed there should be no exemptions whatever, yet that is what this report proposes.
Annexed to the report, as noble Lords will have seen, are brief statements from the main professional legal and accountancy bodies about rules, duties and obligations of confidentiality. It is not only these professionals who have such obligations. So too do other Members who offer services to foreign Governments along the lines I have suggested, and in the defence and security field, because of contractual and commercial obligations, which are surely well recognised and which they are subject to. I hope that some of those will be explained during this debate.
Make no mistake: this report would introduce a major new strategic decision, likely bringing in its wake at some point, despite what the noble Lord, Lord Newby, said and the current disavowal of the committee, the requirement on a much wider basis to register all earnings. I cannot think of any other case where the Conduct Committee has sought to introduce a registration requirement which imposes such profound limitations on the legitimate interests and activities of a number of present Members.
Of course, one recognises the virtues of transparency and of course people have in mind at this hour the optics, with the Greensill scandal unfolding in the background, but in truth the cases could hardly be more different. That case exposes a very real and present problem and is rightly being given a lot of attention in terms of how to counter an obvious mischief. Your Lordships are being invited to approve a scheme with far-reaching consequences, with no demonstrating mischief to cure. I suggest that the transparency here, limited by those who are worried about a wider view, is being sought at simply too high a price and at the cost of too much in the way of legitimate interests which are inconsistent with obligations of confidentiality. Those interests should not be sacrificed merely on the altar of a supposed perception; in truth, that would damage the House.
In an article in last Thursday’s Times, the noble Baroness, Lady Kennedy of The Shaws—I hope she will allow me to call her a noble friend—although supporting registration is recorded as being
“prepared to ditch the requirement to register the amounts earned, saying ‘we can probably guess’.”
Registration of the amounts earned lies at the heart of this proposal and presents a real problem. Without that requirement, the proposal would be substantially less objectionable, but to achieve that modification, or indeed to deal with various other anomalies and uncertainties that may well come to light in this debate, your Lordships would need to accept the Garnier amendment. For my part, I cannot in all conscience recommend that your Lordships accept this report.
Lord Goldsmith (Lab)
My Lords, I support the amendment proposed by the noble and learned Lord, Lord Garnier. First, I congratulate my noble friend Lady Donaghy on the clarity with which she has presented this report, and I hope she knows how much I respect her opinions. I am not going to speak in any detail to the amendment of the noble Lord, Lord Balfe, as time will not permit, save to note that the points he raises, whether one agrees with his proposed endpoint or not, may support the need for further consideration, as the noble and learned Lord, Lord Garnier, is hoping for.
Predictably, I want to focus my remarks on the specific position of lawyers. I am not going to develop at any length the arguments in relation to arbitrators, because that, I anticipate, will be adequately done by others, save to say this. The United Kingdom legal system—I suppose one could say industry—is highly respected. One reason for this is the availability of immensely experienced and professional arbitrators. For cases involving states, it is particularly valuable that those arbitrators include retired UK judges, some of whom we have the benefit of having in this House. Foreign states, as well as other foreign parties, are happy to entrust important decisions to such arbitrators, who they have confidence are not only expert but utterly independent and objective.
I fail to see the concern of noble, and noble and learned, Lords of this House about accepting an appointment as an arbitrator. On that ground alone, the amendment of the noble and learned Lord, Lord Garnier, deserves support. But I believe it deserves support more widely when dealing with the position of lawyers who advise or represent foreign Governments. Here, I disclose my interest. Through my firm, I act regularly for and against Governments, which is a feature to which I will return. I do not lobby on behalf of foreign Governments. I act as a lawyer advising or representing them in actual or potential legal disputes. Of course, as I imagine others will underline, other rules prevent misuse of my position here. I do not believe I have ever spoken in a debate in this House where a foreign government client has been involved.
As for what I do, I may represent them in court, as I did a Caribbean Government in their own courts, and in the Privy Council here in a dispute about their Parliament. I may represent them in international courts, such as the International Court of Justice, in a dispute between several states in the Middle East. I also act in arbitrations, particularly in disputes about the way a state has treated the investments of the nationals of another. This is an important modern device, which has taken the place of gunboat diplomacy when states would seek to intervene to protect the interests of their nationals.
Those representations are mostly in the public domain, and I have therefore disclosed those voluntarily following the first report of the committee. But some are not in the public domain, and some are regarded by the states involved as highly confidential. I am well aware, from experience, that a Government may insist that there should be no disclosure of services in such a matter. Many of them are, as I say, highly sensitive.
Generally, the fees paid are not in the public domain. That matter can also be regarded as very confidential. At least while the dispute is active, the state may not want revelation of what it is paying to foreign lawyers. Under our law and the professional rules of conduct that govern barristers such as me, we are not allowed to reveal that information, save where required by law or with the client’s consent, as the report fully recognises.
The report rightly recognises that the professional duty cannot be overridden, but proposes to deal with that by requiring a client’s consent. That would have to be in advance, as recognised at paragraph 13. It is suggested that not many clients would be deterred. It seems that was based solely on the view of one former holder of high judicial office. I do not think any other evidence was presented. But, very respectfully, I beg to differ. In the field in which I practise, there is almost always significant competition for assignments from different law firms, and, because this is international work, from law firms and lawyers from different countries. If the new disclosure rule comes in, I would have to make it clear, in any pitch or offer, that the client would have to agree to disclose not only that we would be representing them, which in many cases might become public knowledge in due course, but the fees. They may well find that unattractive, because they would be concerned that this information could be misused, for example by political opponents in their own countries. From my experience, I believe that many clients would be deterred.
It goes further than that, because, as I practise in an international law firm, I cannot simply take the view that I can forgo such assignments with equanimity or weaken the showing that we make to potential clients by excluding myself from their possible representation. I have anxiously considered what I should do if this proposal becomes a requirement. I have not finally decided, because for one thing I want to consider all that is said in this debate and its outcome, but I am of the provisional view that I would need to take leave of absence to avoid the dilemma of letting down my partners and colleagues. That is the point that concerns me.
I want to be clear to your Lordships that I am not saying this in terrorem. It is for your Lordships’ House to determine what is best for the House, for Parliament and for the country, and I unreservedly accept whatever decision it reaches. But if that is the route that I determine to take, I thought it right that your Lordships’ House should know why, not least because it would require me to cease chairing the International Agreements Committee, as it is currently my honour to do. I hope it does not come to that, and that the amendment of the noble and learned Lord, Lord Garnier, enables more thought in these difficulties areas, but I thought I should tell your Lordships that that is where I am. I do not think I will have another opportunity.
Baroness Deech (CB) [V]
My Lords, I declare an interest as a former chairman of the Bar Standards Board, which regulates barristers through its code of conduct. By accepting the immense honour of becoming a Member of your Lordships’ House, we explicitly take on certain limitations in the rest of our lives. We take on the Nolan principles; we have to understand conflict of interest and, above all, what it means to act on one’s personal honour and to serve Parliament and the national interest. We have seen, in the recent controversies about civil servants and politicians taking on second jobs, what happens when some of these principles are jeopardised.
The Lords’ Conduct Committee is well aware that, in a small number of professions, there is a duty of confidentiality that makes it difficult for Members to disclose the identity of the Government, organisation or individual to whom services are being provided, and it took that into account. The suggestion that noble Lords should not be required to reveal earnings from foreign work on the basis that it would breach client confidentiality or put them at a commercial disadvantage is, with great respect to noble Lords who are lawyers, without merit.
First, members of the Bar are not obliged to accept foreign work under the Bar code of conduct. Their doing so is a choice. The cab-rank rule does not apply to all foreign work, so a noble Lord can choose whether to accept foreign work and can no doubt advise his or her client that, in so doing, he or she may be required, under the rules of this House, to disclose the level of earnings. It is quite unrealistic to suggest that, if disclosure were required, London would lose its attraction as an arbitration centre. That is, with respect, to regard too highly the contribution made by the handful of lawyers in this House who would be affected by the rule.
Nor is the identity of a client necessarily confidential. One need look only at the websites of, say, Blackstone Chambers, 1 Essex Court, Brick Court or Essex Court Chambers to appreciate that their members—some Members of this House—endlessly list the names of their clients and the prestigious matters in which they have acted for such clients. There may be occasions when advising a particular client is so sensitive that the identity of the client itself cannot be revealed, but, again, that is a matter which should be addressed at the outset with the client by a noble Lord lawyer receiving foreign fees. If the client is not prepared for the noble Lord, his adviser, to discharge his or her duties to this House, the barrister can politely decline to advise and one of the other highly skilled members of the Bar can undertake the work, while the barrister Member of this House will soon be busy with other clients. Is the objection from lawyer Members of this House more about not wanting to be hampered in competing for arbitration work than it is about the sanctity of client confidentiality or the status of London as an arbitration centre?
What may lie behind their objection is not so much the risk to client confidentiality—which, with great respect, is all but non-existent—but that revealing the scale of foreign earnings could be a source of embarrassment to Members of this House who are both discharging public duties and, at the same time, earning very large fees in respect of foreign work. But that embarrassment is not a reason for this House to reject the proposed rule. On the contrary, it demonstrates the need for the rule. If a barrister Peer feels embarrassed at the thought of revealing earnings or clients, it is a good indication that the brief should be declined.
Nolan principles would have to be applied if a barrister Peer were acting for, say, Hong Kong or Myanmar. This would be very relevant in debates and amendments on, for example, immigration Bills, Armed Forces Bills, national security Bills and even financial conduct Bills. It is of course the perception of conflict of interest that matters. No one is suggesting that Members of this House would actually try to influence proceedings in favour of a client without disclosing it.
In the current climate, it is more important than ever that Members of this House should be clear about their dealings with foreign clients. Any exemption from the proposed new rules risks bringing the reputation of the whole House into disrepute, which most of us very much do not want. Barrister legislators may choose what foreign work to take or not take, bearing in mind their privileged position as parliamentarians. There is, I surmise, no shortage of work for them which does not involve such clients.
We should ask our lawyer colleagues to respect the position of the House, accept the committee report and reject the amendments. Although I have sympathy for the noble Lord, Lord Balfe, his amendment would delay what needs to be done right now.
Baroness Stowell of Beeston (Non-Afl)
My Lords, I start by thanking the noble Baroness, Lady Donaghy, and all members of the Conduct Committee for their service to the House. Sitting on any committee of your Lordships’ House is a responsibility, but none more so than serving on the Conduct Committee. These are difficult matters, but, as has already been said, we do have choices. Being a Member of your Lordships’ House is not something which is forced upon any of us.
The noble and learned Lord, Lord Garnier, has explained how complex this matter is, certainly from the perspective of the lawyers of this House and possibly other professional Members of this Chamber. But I believe that it is our responsibility to handle complexity with as much simplicity as possible, and to do everything we can to avoid complexity being perceived as an excuse not to do the right thing.
We have to accept that we live in an era where openness and transparency are important aspects of accountability. Because we are an unelected House, these principles are even more important. Putting in place measures to help us demonstrate our willingness to be accountable for the way we conduct ourselves is important, as is ensuring that we equip ourselves, as a House, to act decisively when one of us fails to meet the standards expected of us in our conduct and behaviour. We cannot always wait for the worst to happen before doing the right thing and hope that a defence of “we would if we could, but we can’t” will stand up to any form of scrutiny.
I understand the arguments that are being made by noble Lords who are opposed to the report and recommendations from the Conduct Committee, but to be absolutely clear, the committee’s recommendations have my full support. I have a huge amount of respect for the noble and learned Lord, Lord Garnier, and the other noble Lords who serve in this House while practising law, but I will not be joining him in the Division Lobby if he divides the House this evening.
I have listened carefully to the noble Lord, Lord Balfe, and, like the noble Baroness, Lady Deech, I am sympathetic to his argument, but I am not sympathetic enough for us to delay accepting the recommendations of the committee’s report today. I urge the noble Baroness, Lady Donaghy, and the committee to consider further what the noble Lord, Lord Balfe, has proposed, but I do not think it is something that should get in the way or delay us today.
In the same vein, I would like to raise one final point. I noted the exchange of correspondence between the committee chair and the Lord Speaker which was published on the committee’s website just a day after it published the report that we are debating this evening. That correspondence is about adding a disrepute clause to our code of conduct. The noble and learned Lord, Lord Mance, explains in his letter to the Lord Speaker that it is not possible for the committee to make a recommendation because there remains
“significant disagreement within the House”
about this matter. I am grateful to the committee for the work that it has done, but it is concerning that this important gap in our sanctions regime remains unresolved, and that it is only being debated behind closed doors. The committee chair’s letter says that this matter will be kept under review, and that is very good. But I ask that, before the letter gathers dust waiting for another serious scandal to happen to prompt action, the committee consider how discussion of this topic could be opened up in order to assist us in resolving it, so that, just as we have seen with the matter that we are debating this evening, the topic could be debated more transparently.
Lord Marks of Henley-on-Thames (LD)
My Lords, I start with a declaration of interest. I am a barrister undertaking mostly commercial construction and professional negligence work. I am also a qualified arbitrator, an accredited mediator and an adjudicator, and I do considerable arbitration work as an advocate—although not presently as an arbitrator—much of it international. I have not, to my knowledge, ever been retained by a foreign Government, foreign government agency, or foreign government-controlled entity. But that is happenstance: I have, for example, appeared against a government-controlled entity.
I oppose the proposed changes in principle—not to protect other lawyers but because I believe that they directly conflict with a professional duty of confidentiality which lies at the heart of the lawyer-client relationship. In this debate, I believe that a perceived concern for transparency, even if genuine, threatens to undermine one of the fundamental features of the right to take legal advice in confidence from a lawyer of the client’s choice.
Of course, this issue goes far wider than the law and affects other professions equally, but in the legal context, at any rate, confidentiality is the right of the client and duty of the lawyer. I do not believe it appropriate for lawyers to offer clients the Hobson’s choice between either retaining the lawyer of the client’s choice and losing the right to confidentiality, or retaining another who will abide by the duty of confidentiality. We, as lawyers, have no right to demand that of our clients, actual or prospective. Who is to say that a client seeking advice at the outset of a retainer may permit confidentiality to be released, only deeply to regret it later, when a client never should sensibly have sacrificed confidentiality in the first place?
In the case of arbitration, where the whole process is by agreement confidential—and with respect to the noble Baroness, Lady Deech, it is not publicised—the position is even worse. The confidentiality is also owed to the other party. Imagine a QC Member of this House retained by an entity controlled by the Government of New Zealand in the arbitration of a dispute with a well-known wine maker. Everyone knows that a dispute is under way, but the arbitration is not public knowledge; nor is it known that the New Zealand Government have retained a QC, nor one who is a Member of this House. The New Zealand public would quickly deduce from the register that the dispute had gone to arbitration and the confidentiality of the arbitration would therefore be blown, entirely without the consent and against the will of one of the parties, who had nothing to do with the retainer.
Let us consider a dispute in England, still involving the New Zealand Government but this time concerning a government contract. The New Zealand Government wish to retain a barrister of their choice for the purpose of taking advice well before litigation. As a Peer, that barrister has to demand the release of confidentiality, whether or not that is in the client’s best interests, or to refuse to act. Such a refusal puts a barrister in breach of the cab rank rule, a point not considered by the noble Baroness, Lady Deech, when she mentioned this, because the cab rank rule provides that you have to take a case—in England anyway but, yes, not abroad—if you can, subject to well-defined practical exceptions. Maybe the Bar will change its rules, but the cab rank rule is at the heart of what we do; it underpins the principle that any litigant has the right of access to the barrister of his or her choice.
The situation for solicitors is even worse, a point elaborated on by the noble and learned Lord, Lord Goldsmith. If a foreign-owned client retains a firm of solicitors, that firm is bound to act in the client’s best interests at all times. If the best expertise in a particular area in the firm was that of a Member of this House, the client would either have to forfeit the right to the advice of the best lawyer for the job or forfeit the right to confidentiality. That is the point made by the noble and learned Lord, and he is absolutely right: it is not acceptable.
Those are only a few of the conundrums that these new proposals present. Yet there is an uncomplicated solution available, which should be considered, if the amendment proposed by the noble and learned Lord, Lord Garnier, is passed. In respect of declarations of interest, the code provides at paragraph 97:
“Where a member feels unable to declare a client due to a duty of confidentiality, then the member should not participate in any proceedings or correspond with ministers or officials regarding matters potentially affecting that client.”
If a parallel rule were introduced in respect of registration of foreign interests, the public interest would be protected. The noble and learned Lord, Lord Brown of Eaton-under-Heywood, made similar points. It goes without saying that that requires some trust that Members will comply with the code, but so does every other provision of the code, which we are all bound on our honour to obey.
I urge the House to reconsider and to ask the committee to reconsider, and to support the amendment proposed by the noble and learned Lord, Lord Garnier. I ask the committee to reconsider its recommendations in the light of this debate and of such further research as it can do, in order to avoid the fundamental conflicts inherent in this proposed change in the code.
Lord Pannick (CB)
My Lords, I too declare my interest as a practising barrister. From time to time, I give legal advice to foreign Governments, primarily on constitutional and administrative law. I appear in court to represent foreign Governments on legal issues both in this country and abroad, just as I do for other clients—sometimes, indeed, against those very same Governments.
I was surprised and disappointed by the Conduct Committee’s ninth report, which we are debating today—surprised because the seventh report published last November recognised at paragraph 13 that
“in a small number of professions there is a duty of confidentiality which would make it difficult for members to disclose the identity of the government, organisation or individual to which/whom services are being provided and/or the level of earnings involved. We propose, therefore, that members in such a position would be able to apply for an exemption from the registration requirement.”
Last month’s report abandons this reasoning and these conclusions, and does so based on fundamental misunderstandings of, at least, the role of the barrister and, indeed, the arbitrator.
As the House has heard, the law is one of those professions in which there is a duty of confidentiality to clients. The very fact that a foreign Government are seeking legal advice from a London barrister is often highly confidential to the client. For perfectly proper reasons, the foreign Government may not wish other persons to know that they are seeking legal advice from me or any other foreign barrister. Confidentiality is fundamental to the relationship of lawyer and client, as the Appellate Committee of this House has recognised.
As your Lordships have heard, the consequence of the Conduct Committee report, if agreed, will be that I and other barristers advising and representing foreign Governments will need to tell prospective clients that we cannot any longer offer them the confidentiality to which they are entitled. The inevitable result will be that many of them will decide to seek legal advice and representation elsewhere.
What is the committee’s justification for this intrusion —and it is an intrusion—into a confidential, perfectly proper and indeed regulated professional relationship? The committee says at paragraph 8 that
“the public interest requires absolute transparency when it comes to members of the national legislature working for a foreign power.”
The noble Lord, Lord Newby, rightly referred to this as the central paragraph of the report. Let us consider the phrase,
“working for a foreign power.”
I have to tell the noble Lord and other Members of this House that, when I sit in Blackstone Chambers drafting a legal advice, I am not working for a foreign power. The very description suggests something sinister and improper. I am giving clients legal advice as to their legal rights and obligations, as I do with all other clients. Some noble Lords—and, I am afraid to say, the committee—fundamentally misunderstand the nature of the role of the barrister.
It is fundamental to the role of the barrister that I am not to be associated with my clients. I act for people of whom I approve, people of whom I disapprove and people to whom I am completely indifferent. The committee fails to understand the role of the barrister. This is more fundamental than a duty of confidentiality. Barristers are not to be associated with their clients, not least because if they were, unpopular people would find it much more difficult to obtain competent representation. No one who understands the ethics of the Bar would think for a moment that for me to give advice to a particular client, whether it be a Government or otherwise, means that I support them in any way whatever.
After summarising the responses that the committee received during the consultation—I was one of those who responded—paragraph 17 of the report simply says blandly that
“the public interest demands that there should be no exemptions to the scheme”.
Why is that? As I have said, legal advice is inherently confidential, it is proper, it is regulated and the barrister is not working for a foreign power. I am not on its team, as seems to be suggested.
The argument is simply this, as I understand it, and the noble Baroness, Lady Donaghy, made the point: we need to consider how this is perceived by the public. That is the argument. The noble Lord, Lord Newby, nods. My response to him and others who take that view is that if, as I believe, an exemption and other exemptions are justified, it is the task of the Conduct Committee to explain to the public why this is appropriate. It is not for the Conduct Committee to make what I regard as a bad decision because of a fear that the public may otherwise not understand the issue. That is what this comes to. So, for all these reasons, I ask the noble Baroness, Lady Donaghy, on behalf of the committee, to agree today that these are fundamental issues that need more consideration, and I ask the committee to think again about this subject.
The Earl of Lytton (CB) [V]
My Lords, at the consultation stage I sent a very short response on this matter and, having followed progress, I welcome the chance to debate it. I congratulate the Conduct Committee on its work. I am certain I have no relevant foreign interest to declare, unless the presidency of a literary society in Missolonghi, Greece, and having an Austrian wife makes me somehow suspect.
I am mainly a retired surveyor, but most of my life has been concerned with avoiding conflicts of interest with matters of confidentiality, ethics and the public interest. The nation clearly expects higher standards of public figures; that is clear. Some years ago, as a member of the anti-corruption APPG, I noted that the Government-appointed anti-corruption tsar spent more time pointing a finger at foreign powers than addressing the acute issues at home. Standards should surely apply across Parliament. With the greatest respect to other noble Lords, I am not sure that there can be exceptions simply for the fact that noble Lords are unsalaried or it is acknowledged that they have outside interests. It is the legislative process that matters. So, part of me is with the noble Lord, Lord Balfe, but I stress that it is only part.
Peers, as we have heard, are expected to act on their own honour, but it appears from what I will term the Russia report that some do not. In the wake of the Greensill affair, we can also see how vulnerable we may have become domestically and, therefore, how much more so to slick, targeted attempts to influence parliamentarians and Administrations by foreign powers—perhaps jurisdictions where the rule of law does not even wholly apply. If we do not sort this out, the nation will take matters into its own hands, out of disgust, disappointment and distrust in its leaders and parliamentarians. So, this debate is of very great significance if meaningful and trusted dialogue, at the root of the word “Parliament”, is to endure.
I sense, on balance, the probable need to accept what the committee has proposed, but I have reservations. Of course, it might mean changing terms of business and carrying out constant case reviews, and probably arbitrary fee apportionments to establish the earnings, but that is a price I would have to accept, and I could avoid the occasions of risk and further that I am not indispensable. I acknowledge the difference between acting as a professional for a foreign state on its own local administrative matters, and using influence, paid or otherwise, in a manner that seeks to influence our own government legislation of public administration for the benefit of that power.
I am confident that the general public understand the sense of all this, even if not the finer distinctions. We exclude from this House on occasion those who are found guilty of gross bullying, disreputable acts in private, criminality and so on. That nuclear option remains available to us; if Members are shown to have offended, they can be shown the door. Used judiciously, that would have a significantly chilling effect on some of the potential abuses feared by the committee. The report makes clear that register entry accuracy is ultimately the decision of the Peer. It is thus based on trust, as we have heard. However, it does more to capture the activities of the honest and willing than of a few less-honest Members. None the less, registration and disclosure in debate are important safeguards, and I support the Conduct Committee’s ethic of consistent application of known standards.
A popular absolutism is not helpful either, although how we are seen outside is what counts, even if that viewpoint is not particularly well informed. Disclosures in a public register do more than inform the world of where prejudice might lie. They also tell those with less healthy interests who is operating in certain areas and the companies or states that they deal with, involvements which could be of political or commercial value to outside influences and which could potentially identify targets for attention. I therefore wonder whether, in due course, some limited exceptions will become necessary. I can see the difficulty for the registrar in sifting through varying shades of involvement, while it is not necessarily that difficult for the Peer making the entry. After all, if they are unable to grasp the general principles, then the public might question why they are here in the first place.
We are involved in a world where asymmetric conflict exists. We must be aware of that, and I would be grateful at times for periodic briefing and updates on the issues that we need to be aware of and on how to avoid circumstances of influencing. However, going forward, I suggest the following principles. We do not want to completely discourage willing horses. The register and the rules on declaration must be fair, workable and not unduly oppressive. Involvements that are essentially small-scale, iterative and within clearly defined bounds should not become a burden. Practical thresholds should be kept in mind and reviewed, and the significance of the involvement, rather than just the money received, should be weighed in the balance. The subject matter of that involvement ought to have some relevance. For some, it is not significant, but we must be robust in defending whatever is in place and insisting on compliance.
There is an area for further discussion. I hope that the noble Baroness, Lady Donaghy, can assure us that the rolling process of review will continue. On that basis, I would support the committee where it stands at the moment.
Lord Adonis (Lab)
My Lords, I come to this issue for the first time because of the controversy which it has aroused in the House. I have played no part in the previous discussions, but coming to this for the first time, reading the relevant reports and listening to the debate, the issue seems very simple. There is an overriding public interest at stake, and there are private interests which have been submitted to your Lordships, mostly—let us say this openly—by those who have private interests. They should not outweigh the public interest. It is as simple as that. As stated clearly in paragraph 8,
“the public interest requires absolute transparency when it comes to members of the national legislature working for a foreign power.”
The noble Lord, Lord Pannick, said that when he sits in Blackstone Chambers he is not working for a foreign power, but he is if he is paid by that power. He works professionally for it; he is not much use to the people paying his bills unless he gives them good professional advice. Any reasonable member of the public accepts, however, that the person who pays you is the person you are working for. That does not mean you do not act thoroughly professionally but it does mean you are working for them, and that should therefore be declared. If the act of declaring it causes embarrassment or—following the noble Lord, Lord Marks—means that a client would regard their right to confidentiality as being breached, then that work should not be taken on by a Member of the national legislature. That is the key point at stake here. The noble Lord, Lord Marks, said that the duty of confidentiality is breached because a client cannot choose a lawyer of their choice, but that is not correct. What we are saying here is that a client cannot choose a lawyer of their choice from the legislature of the United Kingdom.
The actual restriction that this measure would impose —let us be frank—is not great in terms of the range of lawyers who can be secured. But in so far as it imposes that restriction it is perfectly justified, for the reason given in paragraph 13 of the report, which quotes a
“former holder of high judicial office”
as saying
“the public interest ultimately must override the issue of client confidentiality”.
I believe that in the cases we are talking about, which involve foreign states and their agencies—let us be clear that in the states we are talking about, the boundaries between the state and its agencies are not always clear—the identity of the client should be revealed, as should the amount that they are paying.
The noble and learned Lord, Lord Garnier, for whom I have great respect, laid down four premises for the reference back that he moved, none of which actually hold. His first premise was that if we go down this road then we might restrict the capacity of people from a wide range of professions and activities to participate in this House. There is no such restriction. All we are saying is that the public, and other Members of this House, should be fully aware of the activities of those Members—not that they should be restricted, but that they should be transparent. That surely must be a principle at the heart of a modern Parliament. His second premise was that conduct should be regulated by legislation, not by order. He has been a Member of both Houses, so he knows that is palpably not the case. The conduct of both Houses of Parliament is regulated all the time by changes made by order; it is not regulated by changes made by statute.
Thirdly, the noble and learned Lord, Lord Garnier, says that we should postpone a decision because other committees are looking at whether we should go further. There is a case for going further and the noble Lord, Lord Balfe, made it, but that is not a reason for not doing this. It may be a reason for going further in due course, but we should definitely take this step at the moment because it has been so long under consideration by the responsible committee of this House, which, with one honourable exception, has recommended in favour of it. The fourth point that the noble and learned Lord made is that this restriction of the choice of barristers might not particularly affect or concern President Putin. I am not concerned about President Putin; I am concerned about your Lordships’ House and the way in which it conducts its affairs and is seen by the British public. What President Putin does is a matter for him.
The issues at stake here are simple and straightforward. There is an overriding public interest. Private interests have been asserted and our job, particularly those of us who do not have such private interests, is to uphold the public interest. Edmund Burke said:
“Liberty does not exist in the absence of morality.”
There is a straightforward moral issue here, which is that those who participate in the making of the law should not have private interests that are not declared, particularly those that may be antithetical to the interests of the state itself. That is a very straightforward interest and it is overriding in the case of the world as it is now, with the assembly of significant powers that are hostile to us. We should make this change, and we should make it today.
Baroness Jones of Moulsecoomb (GP) [V]
My Lords, when I first read the Conduct Committee’s report, I thought it was very sensible and almost boring. When I heard that there had been extensive lobbying against it, I could not see what the problem was at all. Now, having listened to this debate and heard from noble and learned Lords for whom I have huge respect, I understand the problem. However, as someone with no legal training and who considers herself a member of the public for these particular circumstances, I can assure the House that it is not a good look if we do not pass the Motion on the committee’s report today, and with a huge majority.
Of course, confidentiality is important but I see no argument for why foreign Governments should be owed any duty of confidentiality because they have hired a Member of your Lordships’ House. It does not make sense and I do not think that anyone outside the House of Lords, even perhaps other lawyers, would find it a good idea not to vote for this report. Quite honestly, it is a win for transparency at a moment when sleaze and corruption are flooding our political scene. We really cannot do anything but support the committee’s report.
I am very tempted by the amendment from the noble Lord, Lord Balfe, because, of course, nothing ever goes far enough for me and I would like to see much more stringent measures. However, at the same time I was swayed by the comments from the noble Lord, Lord Newby, about just supporting what the Conduct Committee has done because it has done it with a great deal of thought and consideration. Therefore, I will not vote for the amendment from the noble Lord, Lord Balfe. I certainly will not vote for the amendment from the noble and learned Lord, Lord Garnier, because I thought his whole argument that we should wait and consider things more was quite nonsensical. Either we do it or not; obviously, we can do it later.
There is also a special provision for lawyers. Paragraph 18 says:
“In recognition of the sensitivity of some legal proceedings we propose that lawyers should be required to disclose the identity of clients only once the relationship has entered the public domain”—
that is very sensible—
“or they have been paid (wholly or in part) for the work, whichever comes first. As with any interest, they would need to make the disclosure within one month of it becoming registrable, but they would have longer to register their fees, as set out in our last report.”
The lawyers are covered here in the sense that if work is current, they do not need to declare it until these other circumstances exist.
Existing regimes often fail to ensure that people in government and politics work for the public interest and not for private gain. We need a legal, formal separation of public service from private enrichment. We need to hold former Ministers, former politicians and even former lawyers to much higher standards than exist at present. I am very happy to support the Conduct Committee’s report and very pleased to have been part of this debate.
Lord Hope of Craighead (CB)
My Lords, I must begin by declaring an interest, although compared with some others it is a relatively insignificant one. When I left the Supreme Court in the summer of 2013 and ceased, after four years, to be disqualified from speaking and voting in the House, I returned here with the intention of spending much of my time here. After all, I had spent 13 years as a Law Lord and it had become like a second home to me during those years. I was delighted to come back and be given the opportunity to play a part in the House’s affairs.
However, I received some invitations to sit as an arbitrator and I did three of them, mostly in my spare time, before I was asked to become the Convenor of the Cross Benches. That is a full-time job and I made it clear that I was not prepared to do any more arbitrations. For my four years as Convenor I did not do any. My practice, such as it was, disappeared and that was pretty well the end of it. However, one invitation arrived afterwards and I did accept it. It is an arbitration that is still live, which is why I am directly affected by what this report has to say.
That is because, as in all the other arbitrations I was involved in, one of the parties is state-aided, although not the one by whom I was invited to be the arbitrator—in any of them, as it happens. As noble Lords may know, there are three. Each side chooses one, and the two choose a chairman. I happened to be, in each of them, the non-state-aided nominated party.
I am not at liberty to say which countries these came from. All I can say is that it was not Russia, or Iran, or even China. I was not aware of any security concerns, or any reason why I should declare that interest at the time. My experience also suggests that it is not at all unusual, in arbitrations in which people such as I are involved, for there to be at least one party who is state-aided; it is a relatively commonplace experience.
Time is short, so, with great respect to the noble Baroness, I want to raise two points of detail on the report where I think there may have been a mistake. The first is the need for Members providing legal and arbitrational services to register their details twice. I do not understand why that should be so. Paragraph 55A, under the heading “Directorships”, tells them in peremptory terms that they need to register their interest under that heading. Then paragraph 57A, under the heading, “Remunerated employment etc”, tells them to do it again.
I do not understand why it should be necessary to do that twice. The first requirement seems to rest on a misconception, because in no respect could an arbitrator be regarded as acting as a director for the state-aided party. In my case I was not nominated by that party anyway, but there is a well-understood rule that you have to declare any interests before you take on a position as an arbitrator. If I were a director of one of the parties, that would disqualify me from being an arbitrator at all. So arbitrations have nothing whatever to with that category and I respectfully suggest that including the requirement to register the details there is an error. It does not matter for the overall picture, because I will certainly register under paragraph 57A—the correct category. So I suggest that that should be looked at again, as there may be an error that should be corrected.
The other point is more personal to me, and it relates to the period of grace as it applies to arbitrators—rather more so than to lawyers. My current arbitration, in which I am one of three, began in 2018-19. The date is important, in the light of paragraph 8, which the noble Lord, Lord Newby, referred to, because that date was well before this issue arose at all, so I had no opportunity to discuss with my co-arbitrators—or, indeed, the parties, to whom I am bound by a non-disclosure clause—the possibility of this issue arising. It simply was not in the picture, and I had no opportunity to say, “Sorry, this new rule is coming up and I should withdraw.” So there is a retrospective element in the period of grace, which affects me very much.
Furthermore, although the arbitration started in 2018-19, it is very long-running and complicated, and proceeds in widely separated stages. We had a 14-day hearing in December, the parties’ submissions did not come in until the end of last month, and we are now beginning to consider the first part of our award, which will then be followed by a further stage, and so on. We have been badly affected by the Covid epidemic. Our hearing in December had been delayed by six months: we were going to meet in June but could not do so. Things were further delayed by the fact that all three arbitrators come from different countries, and we are having to discuss our affairs through Zoom, which is a very unsatisfactory way of dealing with a complicated matter that requires deep discussion.
So the arbitration is long-running, and, I have to say, may well not finish by the end of this year. I am in a difficult position, because I am told that if it has not finished by 31 December, I have to take the various steps referred to in the paragraph about the period of grace. The first, which is to finish the arbitration, will not arise in my case. The second is to obtain the consent of the parties to the release of their names and details. I simply do not know whether I can achieve that, given the confidentiality clause.
The final step mentioned is to terminate the relationship. Now you cannot do that in an arbitration. An enormous amount of work has been put into it, and nobody can take my place. If I leave, it would hugely disrupt the whole process and would probably result in an enormous claim for damages against me for breach of contract. So in that situation I would be driven to seek leave of absence, which I would very much regret having to do.
I was invited by the Convenor to be a member of the Constitution Committee, and I am in my first year of a three-year appointment. I would have to come off that at the end of December, which would be a severe penalty for me. I wonder why I should be put under that penalty for a situation that was not an issue when I took this job—so I suggest that that should be looked at again.
The fair thing to do for people in my position, with an arbitration that began before December 2020 and that is still ongoing and likely to go on beyond the end of the year, is simply to say that this does not apply to that arbitration.
I will make one other point before I finish—I am sorry to be taking so long. An arbitration is a one-off event: it is not a continuing relationship. When it finishes, that is the end and I never see the parties again—whereas a lawyer representing a party may have a continuing relationship with no ending until the party declares it should end. So there is nothing wrong, I would have thought, in simply exempting people in my position from having to get involved in this and having to seek leave of absence. Those are two particular points that I would invite the noble Baroness to look at very carefully at some future date.
Lord Scriven (LD)
My Lords, I draw the House’s attention to my interests in the register. Those interests include working with several foreign Governments. I have declared these clients; in fact, I have declared all my clients since I came into this House—not because somebody told me to, but because I believe it is the right thing to do. In so doing, I have lost potential work and clients. I advise Ministers, Presidents and senior civil servants on very confidential matters. That is a personal financial issue for me because, first and foremost, I see myself as having the privilege of being a legislator in this Parliament, and that is my primary function and role.
The reason it is the right thing to do is that all noble Lords in this House hold a very privileged and powerful position in being able to influence public and government policy. Our privileged position is further ingrained by the fact that all of us are here for life, without having to be accountable, via an election, to the general public for the decisions we take on their behalf when voting on legislation and influencing public policy. Noble Lords are not ordinary citizens. We have special rights, privileges and duties that mean in a modern parliamentary system our interests should be fully declared. So, as parliamentarians, as we go about our duties trying to influence public policy and legislation, those who are asked to abide by the decisions this Parliament makes can see if any conflicts of interest arise between individual Members and how they vote, the questions they ask or even the debates they take part in. That is one of the central pillars of what a modern, open and transparent parliamentary system should have in place.
Many citizens listening to this debate will be bewildered that some in such a privileged position advocate for a parliamentary system where Members can secretly work and get paid by foreign Governments. Some of them have questionable human rights records, have tried to influence British elections or have tried to undermine the interests of the UK. One reasons they will be bewildered is that they pay taxes, which then go to pay allowances to Members of this House to carry out their parliamentary duties. But some noble Lords who are receiving payments from the public purse want to deny the right of those who are paying our allowances through their taxes to see what conflicts of interest arise from payments by foreign Governments to individual Members of this House.
The report from the Conduct Committee cannot be left to professional bodies and different parts of the legal system debating whether they can get paid in secret for advising foreign Governments, while making laws and influencing public policy in this Parliament. This is a matter first and foremost about the public interest; that must be primary and above any commercial relationships that Members of this House have with foreign Governments.
The seven principles of public life make that very clear. The principles, also referred to as the Nolan principles, apply to anyone who works as a public officeholder. This includes all those who are elected or appointed to public office nationally and locally. The first and primary principle is selflessness:
“Holders of public office should act solely in terms of the public interest.”
Another principle is openness:
“Holders of public office should act and take decisions in an open and transparent manner. Information should not be withheld from the public unless there are clear and lawful reasons for so doing.”
There is nothing stopping the future disclosure of which foreign Government a Member is advising and getting paid by. The foreign Government will have to make a decision on whether they wish to hire their services on the basis that it will be public and that they will be being advised by a Member of this House. Once that is in the open, it would indeed be in line with the long-held principles of holding office in public life.
Let us be clear. The real issue we are debating is one of potential future commercial relationships with foreign Governments that could have financial implications for some Members of this House. That is a commercial issue and not one that should be central to or influence the rules of conduct that this House has to work to. The Conduct Committee’s report brings the principles of working in the public interest in the most open and transparent ways to the fore. Working in the public interest, underpinned by best practice in openness and transparency, needs to be the bedrock of the rules of this House and must not become blurred or diluted by the commercial or financial impact such rules might have on Members of this House. That is why I fully support the Conduct Committee’s recommendations.
I say to the noble Lord, Lord Balfe, that while I am sympathetic to what his amendment states, if it slows down the implementation of the committee’s report, on this occasion, I cannot support it, but if laid in future I will be able wholly and easily to support such an amendment.
Lord Vaux of Harrowden (CB) [V]
My Lords, last week, the Times described this debate as a battle of “prominent lawyer-peers”. Not being a lawyer, I tiptoe on to the battlefield with trepidation and hope not to get my head shot off in the crossfire.
To start with, I make it clear that I agree that it is manifestly right that we should be transparent about interests involving foreign states, just as with any potential conflict of interest. However, these rules as proposed appear aimed more at the direct personal provision of advice and seem less well suited to more normal employment situations. I fear they may have unintended consequences in some circumstances.
Let me give a theoretical example based on my experience. Before joining the House, I was employed by a large American multinational company which provided software and related services to a wide range of customers globally, including financial services, education and emergency services. I should be clear that I have not been employed by the company since I joined the House. Most customers were not state-owned organisations, but among them were state-owned banks, sovereign wealth funds, state debt management offices, many hundreds—possibly thousands—of US high schools and universities, and other state authorities and emergency services in the US.
My role in the company, which was not customer facing, would probably not have been affected by the amended code. However, it is easy to see situations where other roles might have been caught. For example, a software engineer or product designer creating something as innocuous as a login module, which might be used across multiple products, could find their work routinely provided to many of the state-related entities I mentioned. Whether that would be caught by the wording of “personally provides services” is not clear to me, but certainly that person’s personal work would be provided to the customer. If that same person was also part of the helpline—perhaps assisting customers having login problems—that would certainly be a personally provided service. In that example, I think people would agree that it clearly would not make sense to have to list the many hundreds of US high schools and universities using the software, only part of which was created by the employee.
On top of that, there is the issue of customer confidentiality. My employment contract included robust customer confidentiality clauses and, as is normal in the industry, most customer contracts also included confidentiality clauses. To meet the proposed code, in my example all of the relevant customers, which might be many hundreds, would need to consent to the disclosure of their details and the employer would need to consent to the breach of the employment contract. That simply would not happen. It would be much easier for the employer to terminate the employment or to employ someone else. Further, it would be difficult, even impossible to say what level of remuneration related to the foreign state entities, even if the employer allowed it.
I confess that I find the wording of paragraphs 57(b) and 64 somewhat confusing. To take my example further, let us say that the Member is paid a fixed salary of £50,000 a year by the employer, and the total annual revenues to the employer from the relevant state-related customers totals many millions out of perhaps many hundreds of millions of the total revenue of the employer. I am not at all clear what should be registered here. Should it be the salary, the revenues by customer for the potentially many hundreds of US high schools, or something in between?
The challenge we face is that every situation is different and a one-size-fits-all approach may have the unintended consequence of causing a perfectly reasonable employment to be terminated. In the example that I have given, would it not be sufficiently transparent to register the employment, describe the types of customers and which countries, and disclose the total remuneration received by the Member from the employer? Providing individual details, as the code will require, including trying to apportion revenues of a host of arm’s-length customers, may not be practical or possible and, frankly, may not add much to the transparency anyway.
I said at the start that I support the principle of these proposed changes and I suspect that the practical issues that I have raised will not be common. Therefore, I do not support the amendment in the name of the noble and learned Lord, Lord Garnier. However, I urge the Conduct Committee to keep under review whether the new rules are creating an impediment to perfectly normal and reasonable employment situations, and if necessary to introduce some flexibility to look at particular situations and advise appropriate disclosure on a case-by-case basis that does not necessarily involve naming the underlying individual clients.
On the other hand, there is one area where the code may need tightening further in respect of foreign state entities—that of employment in a sales or an introduction role. It is not hard to imagine that being a Member of this House might open doors. If, for example, a Member, as an employee or consultant, made or facilitated a sale of a software solution to a foreign state, the Member would not be providing any service to that foreign state customer. The employment or consultancy relationship would have to be registered, but because no service was being personally provided to it the foreign state connection would not have to be disclosed under the proposed rules, even if the Member received a commission from the employer directly related to the sale or introduction. That feels like something that ought to be disclosed.
While I do not agree with everything in the amendment from the noble Lord, Lord Balfe, mainly because we need to recognise that this House is different from the full-time salaried House of Commons, and I will not therefore support the amendment, I agree that these matters must be kept under review to make sure that we are properly transparent about potential conflicts of interest.
Viscount Goschen (Con) [V]
My Lords, I start by declaring my interest as an employee of a large multinational executive search and consulting company. In that capacity, I work alongside the boards and leadership teams of a range of corporations and organisations, primarily supporting them in the appointment of board members, chief executives and other senior executives.
I fully support the declaration of material interests in the register and in the Chamber when addressing the House. The proper declaration of interests is an important part of the structure that provides transparency, gives the public confidence in their lawmakers and protects the integrity of the House. Furthermore and specifically, I, along with the rest of the House, take extremely seriously the spectre of influence by foreign Governments, be that perceived or actual. I therefore welcome the vigour with which the Conduct Committee has approached the issue. I should state that the great majority of the work that I undertake is for publicly listed or privately owned companies and not for government-owned or controlled organisations. The specific effects of these measures on me personally would therefore be extremely limited indeed.
However, the reason for my contributing to this debate is that I am concerned about the direction of travel that the House is taking regarding the declaration of Members’ interests. It is a central tenet of this place that we are an unpaid House, unlike another place. Members are not salaried, although an attendance allowance is available to those who wish to claim. It is therefore important, if we are to avoid a membership consisting solely of those who do not need to work or who are retired, that Members should be able to conduct their legitimate professional activities, provided—this is important—that those activities do not conflict with their duties to Parliament.
If the measures before the House today were to be seen as a precedent, it would then extend in future to commercial as well as governmental clients, and I can see very major problems indeed. I would draw a very clear distinction between, on the one hand, lobbying activities, which are particularly sensitive, especially those undertaken through some sort of personal service arrangement, and, on the other, entirely commercial activities, which have really very little bearing on public life, if any at all, and the business of Parliament. Although the experience I have is in a relatively specialist consulting field, the implications would be very similar for activities such as investment banking, for example.
In my own field, having a requirement to publish the identity of one’s clients, and, indeed, fees charged, sounds superficially attractive as a governance measure. But the consequence would be the imposition of a serious obstacle to the ability of an individual to undertake his or her legitimate business, and in the commercial example, the transparency benefit would be minimal. I will take these points in turn.
First, the very fact that a firm has been commissioned by a company such as the one for which I work, together with the identity of the consultant managing an assignment, could be very sensitive information in the public arena to that client, both internally and externally, particularly in the context of a listed company, where, quite rightly, there are very strict legal governance requirements regarding the disclosure of sensitive and privileged information. If, faced with a choice between a firm whose involvement would have to be declared and one which would not, it is straightforward to see what the outcome would be.
Then there is the question of the quantum of fees; there are a number of arguments around this field. The first, in my mind, is that there is a world of difference between the fee that a corporate consulting company is paid and the remuneration that an individual employee may receive; it is a complex issue. The second is that the quantum of the fee may give a strong indicator as to the type of assignment being undertaken, which may well in itself be confidential. The third point is that this would be revealing highly commercially confidential information to the great disadvantage of the firm making that disclosure. The fourth is that the client itself may find that sensitive, specific information.
We must tread carefully here, and we should err on the side of caution, and disclosure, where that would help maintain confidence in the integrity of the House, which is its most precious asset. However, we should also be cautious not to set in train a disclosure regime that could prevent legitimate commercial activity with nothing whatever to do with Parliament or national debate. I feel that the emphasis should be on ensuring that Members do not take on work which would compromise them, their reputations or that of this House, in particular with regard to foreign Governments. I do not feel that disclosing a questionable relationship should give any sort of cover whatever, and Members should exercise and demonstrate their own judgment, and act on their personal honour.
There is danger in overdisclosure, and I am concerned that the really important issues may get hidden behind a swarm of irrelevant disclosures. My noble and learned friend Lord Garnier has done the House a great service by having the courage to raise these issues and bring to its attention that there could be significant unintended consequences of overprescriptive regulation.
I think the House should understand clearly that to adopt this measure would essentially mean that people in the type of environment that I am in would not work for foreign Governments. That is fine and I fully accept that but, if that measure were extended to commercial clients, the implication is that people in a consulting and, very possibly, a legal environment would not be able to undertake commercial work. It is very important that the House realises the consequences of what it is adopting.
The ship has sailed in the sense that we have asked the committee to go away and consider these matters and it has reverted to the House, having heard representations, including from me, and given its judgment. I support the thrust of what my noble and learned friend Lord Garnier is trying to do, but I think that that ship has now sailed. However, we need to keep this under close review and should be very cautious about putting forward a situation which means that Members cannot undertake commercial work.
Lord Foulkes of Cumnock (Lab Co-op)
My Lords, I warmly congratulate and commend my noble friend Lady Donaghy on taking on the serious responsibility of moving the Motion on behalf of the committee and doing it so effectively. I totally regret that, from one quarter, there was implied criticism that she and the members of the committee somehow did not understand the relationships between client and barrister —or client and advocate, as this is still the United Kingdom.
By contrast, the noble and learned Lord, Lord Garnier, described in his very elegant introduction her long, varied and impressive experience, which I commend him for. It is a pity that someone else did not accept that. I have great respect for the noble and learned Lord and his work in this House. He and the noble and learned Lord, Lord Hope—with whom he is having a consultation at the moment—and the noble and learned Lord, Lord Thomas, who are all speaking today, serve with me on the Common Frameworks Scrutiny Committee and do some tremendous work. They work hard and contribute a great deal from their legal experience—incidentally, they do it for nothing, which is even better.
However, I disagree fundamentally with his amendment. I hope that, after considering all the aspects of the issue and listening carefully to this debate —particularly the impressive speech of the noble Baroness, Lady Deech, who, if I picked up correctly, was chair of the Bar conduct committee so must know a thing or two—he will withdraw his amendment.
I have some sympathy with the amendment of the noble Lord, Lord Balfe, and was swithering about supporting it if he pushes it to a vote. However, on reflection, I think it would be better—this is the value of this debate, by the way, to listen to what people are saying—to raise it with the committee directly rather than pushing the amendment today, which I fear might not get through anyway. I think I saw my noble friend Lady Donaghy nodding earlier, when the noble Earl, Lord Lytton, was speaking, to indicate that she would accept his suggestion that the committee further examine this.
This report is a follow-up to the report of the committee which was unanimously approved by the House on 2 December, so it is not sudden or unexpected. That report was based on recommendations of the Intelligence and Security Committee, which spent a long time looking at the malign influence of Russia on our democracy. Having served on the ISC for a number of years, I know how very carefully it considers its recommendations. They are based on well-informed evidence, particularly from our very good intelligence agencies, and should not be cast aside lightly.
We should not be looking to ignore the action proposed by the Conduct Committee in any way at any time. But at this current time, as others have said, it would be particularly unwise to reject it for the following two reasons. First, with the Greensill scandal, the reputation of parliamentarians has sunk, sadly, to a new low. The public are rightly appalled at politicians using their positions for preferential treatment to try to amass—not earn— fortunes. The NHS procurement preference had already tarnished reputations, but now, with the involvement of a former Prime Minister, we have reached a nadir. Secondly, the reputation of this House and its very existence is coming under threat from different quarters, some surprising.
I believe that a Second Chamber is vital for our democracy. Those who look at what is happening in Holyrood, where they do not have a revising chamber, will come down on that side as well. I think the noble and learned Lord, Lord Hope, agrees with me on that. While I support reform of this Chamber, I recognise that our current membership provides a wide range of experience. However, there remains a challenge to our existence from these different quarters. The challenge is whether we have real democratic accountability, and we should be careful not to provide critics with extra ammunition.
We are also facing increased threats and challenges from Russia and other countries. In the case of Russia, we have the massing of forces on the border with Ukraine to add to the arrest of Alexei Navalny, the Skripal poisoning and many other outrages. When our Government and this Parliament are considering what actions to take in response, whether Magnitsky sanctions or any other measures, we need to be absolutely sure that all Members are taking their decisions in the interests solely of the people of the UK, influenced in no way by outside factors. Our actions need not only to be beyond reproach but to be seen as beyond reproach.
The recommendations have been carefully considered by the Conduct Committee, which has relevant experience and knowledge that we do not all necessarily have. The recommendations have the support of all four independent Members, who have been brought on to that committee for their experience, and they have the support of the three major party representatives on it. They have gone out of their way to consider carefully the representations from the bodies representing lawyers and the substantial advocacy of the Members of this House with vested interests, which we have found again today. Rightly, they conclude, as my noble friend Lord Adonis said, that the public interest must come first. Some might reasonably argue, as I think the noble Lord, Lord Balfe, does, that the committee has gone too far to accommodate the interests of the lawyers, including a period of grace until the end of the year. Although, as we heard from the noble and learned Lord, Lord Hope, that raises particular problems.
We each must consider how, and particularly why, we are Members of the Lords. Is it to contribute to the good governance of our country by reviewing and revising legislation and challenging the Government—the work of a legislator—or is it to make a fortune? I have no doubt what my purpose here is.
None of us is obliged to continue as active Members if we instead want to make money by advising a foreign Government without registering that interest. We are not saying that Members cannot continue to do this, but they would have to register that interest. We are not saying that work should not be undertaken, just that it should be registered and the record publicly available. I say to the noble Lord, Lord Marks, that clients can get confidential advice from barristers who are not Lords. Although it seems that most of the barristers around seem to be here today, there are an awful lot remaining who are not Members of this House. The options of leave of absence and retirement are now available—people in other professions take leave of absence if they feel there is a conflict of interest.
I hope that the noble and learned Lord, Lord Garnier and the noble Lord, Lord Balfe, will consider their amendments and the House will adopt this report unanimously. That will send a clear, positive message to the public that this House takes its responsibility seriously.
Lord Bhatia (Non-Afl) [V]
My Lords, I have listened carefully to the speeches made by various noble Lords who are lawyers. I am not a lawyer, but I was impressed by the speech made by the noble Lord, Lord Adonis. He simplified the whole report, and I am grateful to him. I have therefore decided not to read out the speech that I prepared.
Lord Oates (LD)
My Lords, I will also not trespass on the House’s time for too long, because the principal arguments have been made, from both sides, by far more accomplished advocates than I could hope to be. But I want to underline a few specific points.
I accept that the rule may pose difficulties for some individual Members. We heard, for example, from the noble and learned Lord, Lord Goldsmith, for whom I have a huge amount of respect and on whose committee I have the privilege to serve, about some of these difficulties. Notwithstanding those, the essence of this matter is simple, to my mind: it is whether the public interest should prevail over private interests; whether the manifest public interest in transparency regarding the relationships that legislators choose to have with foreign Governments trumps the private professional interest that individual Members may have in the confidentiality of their relationships with such clients.
We have heard much this afternoon about the obligation on lawyers to protect client confidentiality. With respect to noble Lords who have deployed those arguments, including my noble friend Lord Marks, they do not seem relevant. The Conduct Committee report does not interfere in the duties that lawyers or anyone else owes their clients, nor do I suspect that the committee has the power to interfere, even if it wanted to. No lawyer or other professional is required to break any of their obligations under the proposals of the committee. Members of the House of Lords who choose to represent foreign Governments will be required to seek the agreement of a prospective client to transparency, in advance of taking on that client. If the prospective client is unwilling to agree to such transparency, the Peer then has a choice: whether to represent that client or whether their role as a legislator takes precedence, in which they case they will decline to act.
Many of us make choices in our professional life that are very different from the choices that we would make if we were not legislators. That is absolutely right. As soon as we become legislators, our primary obligation has to be to the public interest. From time to time, that may well curtail our private interests. If, at any time, we determine that our other interests need to take precedence, for whatever reason, we have the option of withdrawing from the House for a period of time via leave of absence, as I did a couple of years ago.
What we cannot do, with all due respect to Boris Johnson, is to think that we can have our cake and eat it. As recent events have served only to underline, transparency is essential to the health of a democracy. It is particularly important when it comes to the relationships that its legislators have with foreign powers. The public rightly demand that transparency. The Intelligence and Security Committee has recommended it specifically for this House, and reason and good governance require it. As we have heard, the Intelligence and Security Committee proposes that we should go further and disclose payments from all employment sources. I support the principles behind the amendment of the noble Lord, Lord Balfe. My reticence is only that it would delay this report being adopted. I will certainly support such a Motion if it comes back to us.
It may be that, on occasion, the obligation imposed by the Conduct Committee proves commercially disadvantageous to some Members, but that cannot be our concern. In determining this matter, our concern must solely be with the public interest. In endorsing this report without amendment, we will show that that is exactly where it is.
Lord Neuberger of Abbotsbury (CB) [V]
My Lords, as someone who since 2018—since retiring as a judge—has been practising as an international arbitrator and legal expert, I must of course disclose a real and substantial interest in the issue being debated this afternoon.
As recent events have shown, the need for transparency in the field of Members’ outside interests is very important, but any change to the rules has to be justified and proportionate. Overregulation and unnecessary regulation are self-defeating as they undermine regulation by bringing it into disrepute, and rushing to judgment in legislation or rules can notoriously lead to difficulties. We should not include unnecessary categories of registrability, especially when they may cause damage; while the report asserts the need for the relatively blanket regulation proposed, it does not really explain why it is necessary.
So far as they relate to the legal profession, the proposed amendments are problematic in three important respects: first, they cut across some fundamental legal principles; secondly, even if that is held not to be a sufficient objection to the rules change, they are also questionable in relation to arbitration; thirdly, while—to be fair—recognising the confidentiality problem, they deal with it in a way which is demonstrably unsatisfactory. On the first point of cutting across principles, I can add very little to what noble Lords, in particular the noble Lords, Lord Marks and Lord Pannick, and the noble and learned Lord, Lord Goldsmith, have said. However, I add that much has been made of public interest against private interest. While I readily accept that my private interest and theirs can be said to be affected, that is not something that I accept should be taken into account; but the rule of law is as important as anything else, and part of the rule of law is the right to a lawyer of your choice and the right to confidentiality. On any view, that is being cut into.
Turning to my second point, I suggest that even if one were happy in principle with the proposals, it is highly questionable whether they should apply to arbitrations, at least so far as the appointment of arbitrators is concerned. Commercial arbitrations, whether international or national, are like court cases save that they are mostly held strictly in private; that is one of arbitration’s principal attractions. They are of enormous benefit to this country financially, and not just to individuals, because we are probably the international arbitration centre—indeed, the international legal centre—of choice in the world. It is also right to mention that there are one or two types of arbitration which are public.
Normally there is a panel of three arbitrators, one appointed by each party, and the third appointed by the other two. Even though the three arbitrators are paid by the parties, an arbitrator, whoever appoints him or her, has no duties to any party save to conduct the arbitration independently and fairly; in other words, like a judge. Quite why that makes an arbitral appointment disclosable is a mystery to me other than the—perfectly true—point that the arbitrator may be paid by the foreign power if a foreign power is involved. However, there is no duty to the foreign power; indeed there is positively no duty to act in its interest but a duty simply to act like a judge. I therefore question the applicability of these new regulations to arbitration while freely admitting, as I have said, that this is in my personal interest as well.
Finally, I wonder about the provisions, which have been mentioned already, found in paragraphs 55A and 57A. To the credit of the committee, they try to deal with confidentiality. They say that Members who provide legal services to a foreign Government need not register until one of two conditions is satisfied: first, that the matter is public knowledge; or secondly, that the Member is partly or wholly paid. Condition 1 is, as has already been said by another speaker, entirely sensible, and nobody could quarrel with it. But condition 2, which makes the instruction disclosable only when the lawyer Member is paid, is illogical in principle and perverse in practice. It is illogical because if the matter is confidential, the client’s right to confidentiality is permanent and continues after the lawyer is paid. It is perverse in practice because a lawyer, particularly an arbitrator, will often not be paid—and, indeed, can arrange not to be paid—until the whole matter is over. The idea that the House will know of the Member’s involvement with a foreign Government only once that involvement has terminated is pretty cockeyed, and Members’ purely historic interests or connections are of limited relevance.
I should add that, as the noble and learned Lord, Lord Hope, has shown, the transitional provisions giving effect only to appointments that have been made to date until the end of the year are very problematic.
In conclusion, while I sympathise with and support the whole thrust and basis of the report, I therefore suggest, in agreement with the noble and learned Lord, Lord Garnier, that the committee should consider the possibility of introducing some more satisfactory qualifications to the relatively blanket nature of the current proposals.
Lord Grabiner (CB) [V]
My Lords, I disclose my interest as—I am afraid—another practising barrister and occasionally as an arbitrator in international commercial arbitrations. In my career, I have acted for and against sovereign states, and I have participated in arbitrations to which foreign states have been party. Currently, I have no such instructions or appointments.
Essentially, I agree with all the points made just now by the noble and learned Lord, Lord Neuberger of Abbotsbury, but, personally, the recommendation of the committee would not be a problem for me and I could live with it. However, I respectfully suggest that serious points of principle arise here, including the points that have been made.
In its November 2020 report, the Conduct Committee recognised the duty of confidentiality owed by lawyers to their clients and by persons, who are often but not invariably lawyers, appointed to act as arbitrators. It proposed—this has been referred to before, but I have a slightly different point to make—that affected Members of your Lordships’ House would be able to apply for an exemption from the registration requirement, and that, if granted exemption by the Registrar of Lords’ Interests,
“the member would … register the type of client”
but would not be required to name the client. That seemed a sensible compromise which would, under the supervision of the registrar, improve transparency and, at the same time, respect the confidentiality concern. I am afraid that I was rather surprised by the follow-up report, which concluded
“that the public interest demands that there should be no exemptions to the scheme”.
With great respect to the majority of members of the committee, that is merely an a priori assertion. I say that because the follow-up report contains no analysis by way of support for or explanation of that bald assertion. In particular, we are not told the mischief that the committee was presumably concerned to exclude by its rejection of the confidentiality exemption.
In my view, the arguments the other way are far more weighty. First, a multitude of entities, including many sovereign states and emanations of them, adopt arbitration as the preferred process for dispute resolution because they desire—indeed, they are entitled to—the privacy of arbitration in a range of complex commercial matters. As other noble Lords have said, they choose English law and London because of the quality and reputation of our legal system and our commercial court, which supervises those arbitrations. They also make that choice because of the world-class reputation of UK-based arbitrators, a significant number of whom are Members of your Lordships’ House.
It may not be widely known among your Lordships, most of whom are, thankfully, not lawyers, that the parties to many, if not most, of those arbitrations are foreign and their underlying disputes have no other UK connection. These legal services make a significant contribution to the UK economy. If, as would usually be the case, the parties to the arbitration are not prepared to waive their entitlement to confidentiality and wish to appoint a Member of this House—for example, a retired Supreme Court Justice—as the arbitrator, the effect of the proposal we are discussing is that she or he would either have to decline the appointment or take leave of absence from the House.
Secondly, it is difficult to understand how or why such an arbitrator Member could—still less, would—be able in any way to advance the interests of the appointing party in the performance of her or his role in this House. The same point applies to an advocate instructed to act in litigation for a sovereign state. Advocates are not lobbyists, public relations consultants or formulators of public opinion. They simply present arguments to judges in court or to arbitrators in arbitration. The key point for me is that there is no identifiable mischief which would result if the suggested exemption were permitted. If there were one, I am sure the Conduct Committee would have spelled it out.
Peers have always been actively encouraged to pursue their outside careers—other noble Lords have made that point. Their worldly experience is what qualifies them to be Members of the House. I hope your Lordships will support the amendment put forward by the noble and learned Lord, Lord Garnier.
I add that London is a world-class centre for legal services and it needs to be strongly supported. The proposal before us is disproportionate and unnecessarily prescriptive. If adopted, it would not improve transparency in any meaningful way and, sadly, it may result in some very talented people taking leave of absence from your Lordships’ House. The noble and learned Lord, Lord Goldsmith, is a valuable Member of the House and it would be a sad day if he felt the need in these circumstances to take leave of absence.
Lord Rooker (Lab) [V]
My Lords, as is known, I am not a lawyer. I have found this debate fascinating and interesting. I congratulate the noble Baroness, Lady Donaghy, for introducing the debate in the way that she did. I want to mention two speeches which have struck me, without going into detail. One was from the noble Baroness, Lady Deech, and the other was from the noble and learned Lord, Lord Hope of Craighead. I am not looking for exemptions but, given the proposals in the report, the practicalities of the timing of the particular issue he is involved in are worthy of consideration. I am not looking for exemptions for arbitrators but, in the circumstances of something that was under way before this came on the horizon and which is not due to finish until after the end of December, I could make a special case for that and it is worthy of consideration.
Paragraph 1 makes clear that the report came as a result, as has been said, of the Intelligence and Security Committee’s report on Russia. Published in July 2020, the report was of course completed well before the 2019 general election. Paragraph 54 of that report is the kernel of this, where it sets out certain concerns. These related exclusively to Russia. It says that
“members of the Russian elite who are closely linked to Putin are identified as being involved with charitable and/or political organisations in the UK”,
and we could name them. It goes on to say that
“a number of Members of the House of Lords have business interests linked to Russia, or work directly for major Russian companies linked to the Russian state—these relationships should be carefully scrutinised, given the potential for the Russian state to exploit them.”
I think it went on to say that the code of conduct of the Lords should be made closer to that of the Commons.
The government response to the report is interesting and, of course, it was published on the same day as the report. On paragraph 54, the Government said:
“The Government is confident that the Conduct Committee will give due consideration to the recommendations.”
In other words, get on with it. It was not, “Do nothing about it”, it was, “Get on and do something about it.” In my simple, non-lawyerly view, the case is open and shut. The report should be supported as it is. The reputation of the House of Lords is the most important issue. Of course, individual and professional courtesies apply, as in all walks of life, but they are secondary to the House’s reputation. It is not about perception: the public are not stupid. They can see a dud area when it is put in front of them, and the reputation of the House is subject to massive damage, which undermines the principle of what we do.
We can all make complaints about the size of the House and our procedures, and look for reform, but the fact is that, by and large, it is accepted that we have a right to ask the House of Commons to think again and again on certain issues, and that is a legitimate way—we have had some examples, I understand, from the other place today. I can see, of course, that titles are not unimportant to marketing, legal and other similar services. It is obvious, but why should there be exemptions for lawyers alone? It does not apply to any other professions, such as professional engineers working abroad on massive overseas exercises and projects and Members of your Lordships’ House. The result of the consultation on possible exemption for lawyers is not such that I would agree that the perception on the reputation of the House takes second place, because that is effectively what people are saying. I think it is absolutely clear-cut: if the House wants to put its reputation first, it should support the report.
I also fully accept that we are unpaid. In my case, I am retired on a House of Commons gold-plated pension, so I have no outside interest and I did not work after I left government—and I count the Food Standards Agency in that. So, maintaining outside interests for people coming into the House at a younger age is important. Maintaining the expertise is fine, but who is it for? Is it for the House to share the knowledge, or the individual? I can honestly say that I took the opportunity to check some Hansard records, and at least two Members on the speakers’ list today have not contributed to the House for three years. They have not given the benefit of their expertise to the House. They are on the speakers’ list today; they are not on leave of absence. Let us be clear about this: it is an open and shut case, and there are vested interests galore.
To be honest, I would go further. I do not want to vote for the amendment of the noble Lord, Lord Balfe, and I hope he will not push it, but I think compulsory leave of absence should take place when working for foreign interests. This would make it clear that active membership of the House is not permitted during this time. The public would understand that, the House would understand that, the media and those who watch the second Chamber would understand that.
If that is the consequence of this, I would go further than the report. But I think the report should be supported. The four independent members were appointed for their expertise. It was a quite deliberate decision to have a large number of independent members on the Conduct Committee when it replaced the old Standards and Privileges Committee. We were expected to take cognisance of their expertise and their view of the reputation of the House. I rest my case in support of the report.
Lord Mann (Non-Afl)
My Lords, we have heard several times how we non-lawyers do not understand the principles and complexity of the legal profession. I will quote a recent article on international arbiters.
“The linguistic challenges in international arbitration can be both numerous and significant, with the potential to not only increase the cost and time spent on proceedings, but actually impact the entire outcome of the case.”
We have heard six international arbiters speak, so they will be familiar with the case of Occidental v Ecuador from seven years ago. That case, Ecuador being a state, would obviously be covered in some way by this. The cost of mistranslation was around $2 billion. When I set up a family-owned translation and interpreting company specialising in complex negotiations, I did not pay what I suspect the daily rates were for senior barristers and other legal professionals. We had to pay—it was a few years ago when I last did it—£500 a day. For Korean it was £700. Certain obscure languages would be more. We had to sign confidentiality clauses. There was no option; we could not negotiate to see whether the client wanted it or not. We had to do so.
If I still had that company now, I would be covered by this. It is not just lawyers and the legal profession who are impacted, and I have no problem whatever with the principle. I would have had no negotiating power there. If I had refused to sign a confidentiality agreement because I could not do so, I would not have got the job, full stop. There is no question about it. There was no negotiation potential. Some of the companies, Governments and state institutions were precisely the ones that would be covered by this.
Let us not pretend that only one specific profession is impacted by this. It is a little shameful that what, in the case of Occidental v Ecuador, was called the normal approach of international arbiters to forget about the importance of the translators in the work they do did not manifest itself among the issues that have been raised with the committee. Actually, if you think about it, they are far starker, because there is no negotiating power whatever.
From the language I hear, I get a sense of déjà vu. I wrote and co-presented the trade union submission to the Nolan Committee on Standards in Public Life and its successor committee. I had the job of persuading the senior Labour politicians, because of the links, that they were not going to get the kind of support that some of them were used to without it being declared publicly. It was difficult, because they said, “Hang on a minute. This is quite different. This is not about sleaze or cash for questions.” I am a member of that union, I have a long association with it, and I remember the special pleading every time. Thankfully, Rodney Bickerstaffe, the former boss of the noble Baroness, Lady Donaghy, came to me early on and said, “I’ve got your back if any of these rather famous politicians ever try to have a go at you over this.”
I won on the principle that standards in public life are not divisible and that you cannot claim special interests because of your particular perspective, which is exactly what was happening there. People said, “We are different. We have this relationship.” The same arguments were put coherently, eloquently and forcefully, but they were no different. In that situation, why should the public not know if a trade union had given some money to a politician? What is wrong with that? What is wrong with transparency?
I think of the Commons expenses scandal, which I warned the Prime Minister about 18 months before it became public. I successfully put a resolution through the Commons 12 months before it became public, and I did so without the Whips—I used devices that they had not quite caught up with, and I think it is fair to say that it sneaked through. That reversed and banned the so-called “flipping” of homes. The powers that be were stupid enough not to implement what Parliament had said, and we then saw the explosive consequences.
However, I was castigated again, repeatedly and constantly, as were a handful of others who said the same thing. They said, “We are people of honour”, to which the response is, “Yes, you are, and your honour will be strengthened by transparency. If anybody is not honourable, they will be caught out by transparency, and their behaviour will therefore change”. One did not need to cast aspersions on anybody then in relation to those principles. I am with the noble Lord, Lord Balfe, but not on the detail of his amendment. We need to go a lot further and extend it to Peers who go to embassies abroad. That should be logged and available for the public to see, as should all-party groups that do the same. Transparency is not a bad thing.
We choose to come here. No one has to come here, just as I did not have to stand and be elected as a parliamentarian. When I did, I sold my business because I thought it was invidious to be bidding for work on government contracts when I was on the inside, not because I could not account for it or because it was dishonest. It seemed uncomfortable to me. That is a price worth paying to speak out in our democracy. We are not even elected here. How could anybody not vote for more transparency and for these proposals?
Baroness Falkner of Margravine (CB)
My Lords, I do not think that I have any interests to declare, but, because I am a member of the independent committee of the Bank of England that does enforcement decision-making, and because I am chair of the Equality and Human Rights Commission, I emphasise that I am speaking purely in a personal capacity.
I have spent more than 30 years—18 of them in this House, the others outside it—dealing with foreign policy. I was not working for foreign Governments but dealing with foreign policy; I want to make that clear. There has been a profound change in how foreign Governments and their agents seek to undermine, disrupt, manipulate, contort and use their resources to advance their interests and to undermine other countries’ interests.
I am glad that the noble Baroness, Lady Donaghy, in presenting this report, has emphasised that this is not just about Russia and China, but it is about countries like Russia and China, and a whole lot of other states—many Middle Eastern powers and others—which use the UK’s open, transparent and democratic system to undermine our interests. That is what is at the heart of this. This may not have been the case 30 years ago but it is palpable and tangible, on a daily basis, to anyone who reads anything about foreign affairs in today’s world.
For me, there is nothing extraordinary in asking British parliamentarians who provide advisory services to foreign Governments to declare that and to declare the fee—in other words, their piece of gold—to advantage another Government. I use the word “advantage” advisedly. Most reasonable people would consider it a fairly proportionate ask. That these people are forbidden from providing such services is not what the report is calling for; all it is calling for is for them to tell us who they are working for and how much they are being paid. What is unreasonable about that? It would allow the public to assess the motivation of those Peers, our colleagues, working as lawmakers, and see where they are coming from.
I am grateful to Transparency International for providing a briefing which selected the numerous Members of this House who had declared in the register of interests working with or for foreign Governments. I have long watched that space—perhaps I have been more conscious of it because of the work that I have done. One of the interesting things that stands out is that those people are doing what we are now asking this other very small cohort to do. This is not that unusual. People already have to declare when they work for unsavoury Governments of all kinds, such as Bahrain, Kazakhstan, a host of “stans”, Russia and China, whatever. What is the outlier here? In the case of the work that we are talking about today, if the public want to know what is going on, and if we want to know what is going on, we have to open a national newspaper, where we will occasionally come across an interesting point that we had not been aware of.
It has been said that the information that people are being asked to provide today is of limited value. It may well be of limited value, because it is historic, but, nevertheless, it would be available. Even looking at historic information helps the public to know that somebody who is speaking about a law today might have had some interest in the past. That is the value of it.
Let me turn to the argument that London’s status would be diminished if a handful of lawyers potentially hold back from working for a foreign Government or its agents. London is not Andorra; it is not San Marino. The City of London’s reputation is solid and it will not be diminished; rather, it will be held in higher regard if it is known that, when you buy a British lawyer—potentially the best in the world, we are told—that will be known to all and sundry. I suspect that Governments would be proud to say to their domestic populations, “Yeah, we went out for the best”.
Of course, we will all be terribly sorry to lose the expertise of the noble and learned Lord, Lord Goldsmith —or indeed any other noble Lord who may wish to no longer participate—if he has to take a leave of absence. As the noble Baroness, Lady Stowell, said, we all make choices; we make choices as to whether or not to participate here.
Others have mentioned the fact that the clients of corporate law firms may have to forego using the lawyer of their choice. This may be so, but companies and clients around the world are frequently barred from using the lawyer of their choice simply because they cannot afford that lawyer. The bar exists in any event; it would not be a new innovation.
When it comes to the definition of “working” for a foreign Government or foreign power, there is the idea that giving advice is not “working” and does not imply support for the foreign power. But we know that public perceptions are important, and, for the public, of course it implies support—they are not going to go through the detail of professional standards at the Bar Council. If the public see in the register in retrospect that, historically, a particular lawyer has done a certain piece of work, and then that lawyer speaks with a level of expertise on a certain matter, the public can determine whether or not the expertise is warranted and whether to give any weight to it.
I have listened carefully to the very thoughtful points made by so many distinguished noble and learned Lords and lawyers today, but it is my view that if this is unfair—it might seem so, and it may even be somewhat unfair—then upholding the highest standards that we can and retaining public trust in our institutions is worth the curtailment of their freedom. If they wish to remain with us here in this House, they should rightly be prepared to take this step. We all make sacrifices in the interests of probity, integrity and democracy.
Lord Thomas of Cwmgiedd (CB) [V]
My Lords, at this late stage in the debate all the principles have been canvassed, so I will speak briefly. Before I do so, I declare two particular interests: I sit as a judge in Qatar as president of the Qatar International Court, having been appointed by the state of Qatar in 2018, and I sit as an arbitrator practising in London in commercial arbitrations, although I have not sat in a dispute where one of the parties was a foreign state.
As this debate has shown, there are two conflicting issues of principle. First, there is the fundamental right of the client of any lawyer to confidentiality between him and the lawyer and the fundamental rule of confidentiality in arbitrations. The other conflicting principle is the imperative in a democracy for transparency and, to that end, that the interests of all Members of the legislature are disclosed. The objective of the Conduct Committee was to balance these conflicting principles. That was not an easy task, as the committee had to balance, first, the potential damage to London as one of the leading centres in the world for dispute resolution, both in court and arbitration; secondly, the potential risk that foreign Governments would not be able to take advice from some of the ablest lawyers in the UK, or that some of the ablest lawyers in the UK would be disadvantaged; and, thirdly, the potential damage to our democracy and to public confidence in the House.
In my view, in matters of this kind we as a House should generally respect the judgment of the committee on such a balance. The committee has consulted. It is a body that contains independent members, and independent members often have a different and balanced perspective. The House should therefore not lightly go against such a judgment and decision. However, it is not necessary for me to resort to saying that because I am of the view that the committee has reached the right judgment in the report on balancing the two conflicting interests.
First, the requirement is not intended to be retrospective. It would be difficult, in accordance with principle, to make it retrospective as there are, in certain circumstances, commitments that have been undertaken, and it is the duty of the person concerned to continue with them and with the existing rules. As there are likely to be current matters that run on beyond the grace period—a year, as many will know to their cost, is often a short time in some arbitrations—the requirement of confidentiality should not be applied so that it operates retrospectively. However, for the future there can be no doubt about the proper course of action.
If the report is adopted, a foreign state will be told when it seeks to instruct a Member of this House that the fact that it has sought legal advice or representation by a Member of this House, or has appointed a Member of this House as an arbitrator, will be made public; it will have to disclose that fact and the remuneration paid. If the state does not wish that to be made public then it will not go to that particular Member of this House. However, I cannot see how that can damage London. The strength of London is that there are sufficient persons of great skill and eminence who can provide these services. In my view, that very strength makes it extremely unlikely that any damage would result from the judgment that the committee has made.
Clearly, there will be disadvantage to some. But it is a fact of life as a lawyer that you have to disclose interests when they arise. When there is a conflict or the client learns of certain interests, he may decide not to instruct that person. I see no difference in principle between that position and the position that would require disclosure by a Member of this House. Clients are used to dealing with situations of that kind. The position may be different for members of large law firms, as they would be disabling their partners from accepting such work. But unless a special exemption was crafted for such a person, I do not see how that should prevent the adoption of this report, damaging though it might be to one or two individuals.
When one looks at the position on the other side, no one in this House can have the slightest doubt about the integrity of the lawyer Members; nor would anyone for a moment think that any lawyer advising or representing a client would be influenced by that activity in relation to the business of the House. However, in these matters, the public’s perception is all. I do wish lawyers were better understood by the public—that the public understood their role and shared the views of those in this House about the way lawyers act. However, that is not a realistic expectation. It is important that we are fully transparent. What matters is the public’s judgment of the way we conduct ourselves. Transparency is essential and it must, subject to retrospectivity, take precedence over confidentiality. For these reasons, I hope the House will agree to the report.
Viscount Waverley (CB)
My Lords, this debate leaves absolutely nothing to doubt. Transparency is all. I have always been an advocate of overly declaring and have no problem whatever with the provisions today. I follow the noble Lord, Lord Vaux, somewhat. While not being totally hypothetical, that is not the principal cause of my remarks, which I will come to in a moment.
I am founder of an internet-based platform, supplyfinder.com, which is properly declared. It covers 224 countries and works in the UK’s interest. It is conceivable, however, that the export promotion agencies of any country may wish to avail themselves of the opportunity to extol their exporters, or the country as an inward investment destination. That agency may be a promotion agency wholly owned by a state. I only mention this because of the issue concerning the state. I am not lobbying for the state, but states have the opportunity to put certain issues relating to their activities on to the site.
Turning to my principal points, the Nolan principles of public life are not difficult to comprehend and should come as second nature when partaking in parliamentary or governmental affairs or the Civil Service, or when they need adding to local government. My driving dynamic in your Lordships’ House has been to attempt to bring first-hand insight and balance to many complex issues, principally those from afar. While always hoping for constructive and stable relationships, it is necessary to get under the skin of a subject and to attempt to ensure that channels for dialogue are open. Today’s mounting tensions with Russia are testimony to that, with dialogue in the deep freeze.
I hope that I might be excused, therefore, in putting on record some matters in relation to that country, particularly given that the report before us has Russia with any possible influence—which in my case is zero—in Parliament as its focus. Members of the committee might be aware that the Sunday Times referred recently to several Members of your Lordships’ House, myself included, in the context of Russia. Hansard records that I have addressed Russia in substantive remarks on three occasions. First, when Russia was debated on 7 June 2000, then on Chechnya and the North Caucasus when debated on 5 May 2011 and, finally, during my remarks in a debate that I introduced on relations with that country on 29 January 2018.
Some time after that 2018 debate, I ventured to Russia, paying my expenses lock, stock and barrel. However, that included being invited—again, properly declared—to the St Petersburg International Economic Forum to speak. Given that the current British ambassador in Moscow is patron of the Russo-British Chamber of Commerce in Moscow and London, with her husband serving as executive director, I assume that that presents no issue of concern.
Subsequently, while attending a Speakers’ conference of 40 regional Parliaments in Nur-Sultan, Kazakhstan, where the Speaker of the Russian Duma was also present, our respective minders inquired whether a call on Speaker Volodin would be of interest. It seemed churlish not to accept. I set out in detail all the deep concerns of the United Kingdom. Speaker Volodin remarked that no parliamentarian from the UK had called on him, yet parliamentary delegations from various European parliaments had done so. We discussed how parliamentary exchange might be affected, given that the IPU UK chairman had placed an embargo on any dialogue with Russia, with a firm proviso that there be no calls that included the Kremlin, and conditional on opposition political parties being included in any programme. A visit was facilitated by the Council of Europe. I was accompanied by two senior Members of your Lordships’ House—the noble Lord, Lord Balfe, who is in his place, and the noble Lord, Lord Browne of Ladyton, who is not in his place.
We were briefed prior to departure by senior members of the Foreign Office, including at director level. Their principal concerns were that the Russians would manipulate the visit to their ends. I will conclude by confirming that the Russians did not do so and have not done so, and conducted themselves in an appropriate manner. The trip met our objectives, with the Russian side keeping in line with our pre-established conditions. I leave it to this committee and the Foreign, Commonwealth and Development Office to draw their own conclusions.
The report before us rightly recommends that in case of doubt one should err on the side of registration. That process would benefit from having any clarification deemed appropriate added to avoid erroneous perception whereby when one does declare, by the letter of the arrangements, it could be perceived as not telling the whole story. It would therefore be helpful to add a short clarification so that the public are aware of the detail.
I have certainly welcomed the opportunity to counter the remarks reported in the Sunday Times that, in my regard, were played absolutely with a straight bat in the United Kingdom’s best interests.
Baroness Donaghy (Lab)
My Lords, I am very glad that we have had this debate. I shall thank one or two people before I reply. First, I thank the noble Baroness, Lady Stowell of Beeston. It is always very nice to have a former Leader of the House backing you up. I also thank the noble Baroness, Lady Deech, who hit the nail on the head about the decisions we are taking today. I thank the noble and learned Lord, Lord Garnier, for his collegiate approach, which is very much appreciated.
I am grateful to all noble Lords who have taken part in today’s important debate on what is a difficult issue. The views expressed are strongly and sincerely held. I cannot promise to address all the points made, but I will answer as many as I can, not necessarily in the order of those speaking.
The noble and learned Lord, Lord Hope, raised points about his long and ongoing arbitration. I think the committee, in keeping all this under constant review, will also keep an eye on the grace period. If it becomes clear that there are a lot of difficulties like those that he outlined which cannot be resolved by the end of 2021, I am sure it would consider extending the period. I am rather sorry that one noble Lord criticised the grace period and said it did not mean anything, because the intention was to make life easier, particularly for the lawyers. On the noble and learned Lord’s point about arbitration, it needs to be registered in either category 1 or 2, not both. It will almost certainly be category 2 in his case, but we mentioned it in category 1 just in case an arbitrator set up an arbitration company of which he was a director, which would make it a category 1 entry.
I will deal with the points made by the noble Lord, Lord Vaux, echoed by the noble Viscount, Lord Waverley, in the previous speech. When we say “services”, we do not mean it in the sense of the services sector; we mean literally anything provided in return for money. A one-off sale of something might be caught if the Member worked on achieving the sale. We will keep things under close review and, if employed Members are suffering a detriment from their employer because of the new disclosure requirements, we will look to see whether we can address that. The noble Lord gave the example of software, and I think the noble Viscount did as well. There would have to be substantial and direct contact with the client to make it subject to these rules. It could be either the revenue received by the firm or the money received by the Member. If any clarification is required, I am sure that the registrar of interests would help out where there is any lack of certainty.
I turn to the issue on which some noble Lords felt very strongly: that we consulted Members and their professional bodies but then appeared to have ignored the results or gone against their advice. The response to our consultation covered the full spectrum of opinion, from wanting no exemptions whatever to objecting to the scheme on principle. There was no consensus on the right thing to do. With regard to the representations made by professional bodies, we gave those from the legal profession particular consideration. We recognise the duty of confidentiality that lawyers have to their clients, and have therefore proposed specific provisions to account for them. Not only will lawyers benefit from the grace period for existing clients and the prospective nature of the new requirements, they will also have a special provision allowing them to delay disclosure of clients until they have been paid.
I am the first to say that the UK is top of the tree when it comes to our legal expertise and arbitrators; I had experience of some of that when I was chair of ACAS. Preventing Members of this House, many of whom are leading members of the UK’s legal profession, from doing this would seriously undermine that reputation, they maintain. The Conduct Committee believes that the public interest requires absolute transparency when it comes to Members of the national legislature working with a foreign power. We do not dispute that many Members who are of great benefit to this House are also of great benefit to their professions and, by extension, the UK’s reputation in those areas. There are, however, very many more outstanding lawyers and arbitrators who are not Members of this House, and we doubt that the UK’s reputation in these fields will be seriously undermined.
I could try to pick up all the points made by noble Lords, but in view of the time I will not cover most of the points; I hope that I have done the ones that people were most concerned about. I reassure noble Lords of what I said in my introductory remarks: the Conduct Committee will keep this under review, and advice will be available from the registrar of interests. The House knows that the time is right for this reform. I have deliberately not mentioned all the headlines that have been in the papers for the last week or so; this is an issue affecting us, it is a recommendation from the Conduct Committee, and I am not getting involved in those areas. The time is right for this reform; I hope the noble and learned Lord, Lord Garnier, will feel able to withdraw his amendment in the light of some of the assurances that I have given.
Lord Garnier (Con)
My Lords, as I did at the outset, I once again thank the noble Baroness for her introduction to this debate and, indeed, for her wind-up just now. It was a model of moderate and—to some extent, but not altogether—persuasive advocacy. That having been said, it is right that we should acknowledge, as I think I fairly pointed out in my own remarks a little while ago, that this is not a lawyer’s whinge. The fact that a number of lawyers who are Members of this House have spoken is not something we should be ashamed of, nor retreat from; they demonstrate the practical consequence of what could happen if this proposal goes through.
As has been pointed out by the noble Lord, Lord Adonis, noble and learned Lords, and Members of this House who are lawyers or in other professions, it is fair to say that there is a genuine conflict between the public interest in transparency about what we do in this House and the public interest—it is a public interest, as the noble and learned Lord, Lord Neuberger, most correctly pointed out, aided by the noble Lords, Lord Grabiner, Lord Marks and Lord Pannick—in the private relationship of confidentiality between a lawyer or any other professional, be it a doctor, an architect, an accountant, even the great translator, the noble Lord, Lord Mann, and their client. Without that confidentiality being maintained, respected and understood by this House, there will be an undermining of the rule of law and all that goes with it.
It is not something we can set aside lightly. I accept, however, that it can be set aside if it is done deliberately by a House of Parliament—this House of Parliament—having advised itself and considered where it believes the balance between those two public interests should be resolved. Clearly, the sense I get this evening from those who have spoken in this debate is that this House considers that the public interest in transparency outweighs the public interest in permitting the continuance of a Member of this House, as a lawyer, maintaining and seeking to preserve—and indeed upholding—the privacy and confidentiality of his or her relationship with a client, no matter whether that client be a foreign state or a private individual.
Let me just touch upon the expression “a foreign state”. The report, at paragraph 8, in my view tendentiously, uses the phrase “a foreign power”. It takes me back to John Buchan novels. Of course, I suspect that that expression was used deliberately because it creates an impression. Indeed, it created a sufficient impression on the noble Baroness, Lady Falkner, that she went one stage further and drew our attention not only to lawyers working for a foreign power but to lawyers being bought by a foreign power. She thus ignored, if I may say so with the greatest respect, that proper relationship between a lawyer who is instructed to act independently and to use his judgment as an officer of the court, and the client—it, him or herself. One would no more accuse the noble Lord, Lord Pannick, of being an agent for a murderer because he defends a man on a charge of murder at the Old Bailey, than one would accuse him of being an agent of some foreign power because he has been instructed to represent it in an arbitration.
We need to use our language carefully in debates such as this, because the backdrop to it—albeit that the noble Baroness, Lady Donaghy, very properly and deliberately, did not enter into this arena—is, as we all know, sleaze: Russian suborning of Members of both Houses of Parliament for malign political or diplomatic ends, and the recent problems caused by the David Cameron and Greensill Capital matter. They are, as I said at the outset, wholly irrelevant to what we are here deciding—and the noble Baroness was perfectly correct to distance herself from those—but some of us, for good rhetorical reasons, no doubt, have decided to conflate those questions. That, of course, is entirely their right. It is not, to my mind, attractive, but that is of course their right.
There is a difference, as I said, between those two public interests, and this House has a right to decide which takes precedence in this particular matter. There is a difference between making a declaration and making a registration of one’s interests, of all sorts, and it is not a declaration or registration that applies only to complaining lawyers. It applies to all of us. It particularly applies to all of us who have outside, paid interests.
There is also a vast difference—and here, I bring the debate back to an area where the noble Baroness did not want to go—between spivery, or commercial paid lobbying, and legitimate commercial activity. We heard that from the noble Viscount, Lord Goschen, and we heard it from a number of other Members of this House who may or may not be lawyers, and some who most definitely are.
I want briefly to touch on what I thought was one of the most effective contributions this evening: that of the noble and learned Lord, Lord Hope. He gently but hugely persuasively pointed out that, despite the enthusiasm of the majority of those who have spoken tonight, there are likely to be unintended consequences of swallowing this report whole. I am grateful that the noble Baroness, having no doubt listened to him, is prepared to keep an open door—I think I quote her correctly; she used that expression or something similar—so that, even if this Motion goes through unamended tonight, the matter is not closed.
I hope that other members of the committee and all Members of this House will agree with the noble Baroness because, if we are to shut this door so that good, honest, reputable Members of this House such as the noble and learned Lord, Lord Goldsmith—he did not terrorise me when he said that he might have to take a leave of absence—feel that they have no option but to depart this place, it will not hurt them but it will undermine and damage the standing of this House. We benefit from the presence of great lawyers, architects, accountants and professionals of all sorts in this House; we are not diminished by it. I urge this House: please beware the unintended consequences, take the noble Baroness at her word and allow us, if this does not pan out well, for the benefit of the public and this House—forget the benefit of the lawyers—to make sure that the door of this committee is open and never closed.
When he was the majority leader in the United States Senate, Lyndon Johnson said that a politician needed to know how to do only one thing: add up. I have done a little calculation. It would be unwise, even Balaclava-like, to charge through the Division Lobby this evening—much as I would enjoy the punch-up. Bearing in mind both what the noble Baroness has said this evening about her door being open and the damage that would be caused if this were put to a vote and decisively defeated, it would be better for me to seek the leave of this House to withdraw my amendment.
I do so with gratitude to all those who have spoken in this debate on both sides of the argument. This debate needed to be had and, if we are to be told what we are to do, who we may talk to and who we may work for outside this House, well, we must have the debate publicly in this Chamber. I would like to see it done via legislation but that is a different matter, and I am delighted that we have done it here and not just in the close confines of a small conduct committee.
I have spoken too much and too often. I have so many interests to declare, having listened to what has been said tonight, that I may have to take a leave of absence—at least until next week. I beg leave to withdraw my amendment.
Lord Balfe
As an amendment to the Motion in the name of Baroness Donaghy, at end insert “but, while welcoming the report, believes that it only deals with a small part of the issues that need addressing; further believes that if the public are to be supportive of legislation, they have a right to know the full financial interests of legislators; asks the Select Committee to examine the need for the House to adopt disclosure rules as close as possible to those operated by the House of Commons; and instructs the Committee to bring forward a further report exploring this matter.”
Lord Balfe (Con)
I will speak very briefly. I appreciated in particular the speech of the noble Lord, Lord Mann. We need to keep an eye on what might be charging over the horizon—and to keep our way of doing things in this House open and transparent.
I reflect that 56 years ago this week I strode over the steps of the Foreign Office as a very junior member of staff. Since then I have spent most of my life talking to people, many of whom have been quite objectionable. However, I have always tried to talk to them at our expense. One very useful thing has been the Lord Speaker’s fund, which allows you to visit countries of the Council of Europe at the expense of this Parliament. You are never in a country where you are asking for anything at all because the House pays the fare and the subsistence. It is a very valuable programme as it enables people to talk to others without being beholden to them. It is the programme on which the noble Viscount, Lord Waverley, and I went to Russia.
It is important to talk and, of course, not all relationships are financial. Tomorrow morning I shall be having coffee with the Turkmenistan ambassador. Now, many people have things to say about Turkmenistan and its attitude to such matters as human rights, but this is part of a big jigsaw, is it not? You have coffee with him, which is not a declarable interest; it is important that we do not retreat into a laager. In 25 years in the European Parliament, I spent a huge amount of time talking to people who, let us say, were not our cup of tea—people such as the French National Front and others beyond that.
With all that in mind, and in the hope that, through the Conduct Committee, we will as a House look into the possibility of expanding and clarifying our areas of declaration so that they become closer to those in the Commons than they are at the moment, I will not press my amendment.