Grand Committee
Arrangement of Business
The Deputy Chairman of Committees (Viscount Colville of Culross) (CB)
My Lords, if there is a Division in the Chamber while we are sitting, this Committee will adjourn as soon as the Division Bells are rung and resume after 10 minutes.
Public Offers and Admissions to Trading Regulations 2023
Baroness Swinburne
That the Grand Committee do consider the Public Offers and Admissions to Trading Regulations 2023.
Relevant document: 7th Report from the Secondary Legislation Scrutiny Committee
Baroness Swinburne (Con)
My Lords, these regulations are made under powers introduced by the Financial Services and Markets Act 2023, or FiSMA. They form part of the Government’s ambitious programme to deliver a smarter regulatory framework for financial services, replacing assimilated law, formerly known as retained EU law, with an approach to regulation that is tailored to the UK. This instrument has been brought to the attention of the House by the Secondary Legislation Select Committee, which raised this SI but did not raise any specific issues.
The instrument delivers the key recommendation from my noble friend Lord Hill’s landmark UK Listing Review, published in March 2021, that we should fundamentally overhaul the UK’s listing regime, which is largely contained in the EU-derived prospectus regulation. The Government have previously acknowledged my noble friend Lord Hill’s contribution to this agenda, and I do so again. His report and this instrument represent a significant step change for our capital markets, making our listings rules fit for purpose and taking advantage of our ability to rewrite EU rules designed for 28 diverse markets. This instrument is a key step in the Government’s comprehensive and significant work programme to make UK capital markets more efficient and competitive while maintaining high standards. These changes will create a simpler and more effective regime that allows companies to raise funds more quickly and efficiently and provides investors access to better-quality information.
There have been two consultations which form the basis of this legislation: first, a government consultation on the prospectus regime in July 2021, which built on the recommendation from my noble friend Lord Hill; and Dame Elizabeth Gloster’s report of the independent investigation into the FCA’s regulation of London Capital & Finance plc. Both these were widely engaged with by industry, and the Government have previously confirmed our intention to move forward with these proposals, largely as consulted on.
A prospectus is a disclosure document that provides information to investors on a public offer of securities. The current prospectus rules regulation, the Prospectus (Amendment etc.) (EU Exit) Regulations 2019, sets out in prescriptive detail what a company must publish when raising capital on public markets. Many in industry found this regime to be cumbersome and inflexible, and it has been proven to stifle the capital-raising process for many firms. The current EU-derived prospectus regulation regulates both offers of transferable securities to the public and admissions to trading of a company’s securities on a regulated market. As my noble friend Lord Hill astutely observed in his review, treating these two often very separate activities with one prescriptive regime can increase costs for firms and undermine capital raising and investor participation. This instrument therefore creates a new framework for both these activities for the UK. This will be more streamlined, more targeted and make the process of capital raising more efficient and effective.
Underlying all this, it is the Government’s intention that appropriate information be published when companies raise capital on public markets or directly from the public. Under our new framework, therefore, companies raising money on capital markets will be required to publish information that is relevant and useful for investors, while removing unnecessary barriers to such information and unnecessary requirements. It is also the Government’s intention that firms raising money outside capital markets—for example, through crowdfunding platforms—can continue to do so, but in a more targeted, flexible and appropriate way. The regulation achieves this in the following ways.
First, it creates a general prohibition on public offers of securities, followed by a series of exceptions from this prohibition: for example, where the securities are traded on an exchange; or where the offer of securities is to fewer than 150 investors. These exemptions set the scope of the regulatory framework for public offers and mean, in practice, that in many situations firms will not need to produce a full prospectus when raising capital in the UK.
Secondly, this SI establishes a new regime for securities admitted to trading on a regulated market or multilateral trading facility—an MTF—giving markets such as AIM and Aquis Exchange the benefit of these reforms as well. Thirdly, it creates a new regulated activity of operating an electronic system for public offers of certain securities that are offered above £5 million. This will create flexibility for firms using a crowdfunding platform to raise capital, while providing the appropriate level of retail protection.
In line with its responsibility under our domestic financial services framework and as agreed during the passage of FiSMA, the FCA will be given new rule-making responsibilities to set rules that apply directly to firms, such as specifying when a prospectus is required and what a prospectus should contain, and addressing the manner and timing of validation and publication, among other matters.
Following the recommendations in Dame Elizabeth Gloster’s review into the FCA’s regulation of London Capital & Finance plc, this SI also brings non-transferable securities, such as mini-bonds, into scope of the public offers regime. This will ensure better investor protection. In practice, this approach means that offers of these types of investments will need to be made through a public offer platform, such as a crowdfunding platform.
Finally, under the current prospectus regulation, a public offer of unlisted securities of €8 million or above requires a prospectus. This instrument removes this threshold, which was effectively acting as a cap to certain private capital raising in the UK. These changes will allow all firms, small and large, to raise larger amounts of capital more easily and more quickly, helping them to grow, hopefully, in the UK. After these debates conclude, the FCA will soon consult on the detailed rules that will underpin this new regime. HM Treasury has worked closely with industry and the FCA to deliver this instrument.
To sum up, this SI replaces the EU’s prospectus regulation with a more appropriate framework for companies to raise capital from the public in the UK. These tailored changes will make the capital-raising process far more agile for UK companies while providing investors with good-quality, accessible information. The new regime will remove the often burdensome elements of its predecessor, which was designed for 28 markets. It will deliver the key recommendation of the listing review from my noble friend Lord Hill, in turn boosting the UK as a destination for listings.
In particular, the new prospectus regime marks a significant step in improving the competitiveness of UK capital markets, helping to make London a more attractive destination to list, while allowing investors to be better informed. It sits alongside a wide-ranging programme of capital market reforms that the Government are taking forward, as part of the Edinburgh and Mansion House reforms. I beg to move.
Baroness Kramer (LD)
My Lords, I welcome the noble Baroness, Lady Swinburne, who has stepped in at the last minute today. We send our wishes that the noble Baroness, Lady Vere, recovers from her illness swiftly.
We were supportive of the Hill recommendations for changes to the prospectus regime, so we do not oppose this SI, but I will express a fair dose of anxiety. I want to register a concern at the power shift away from Parliament to the FCA. At present, the FCA acts with little accountability or oversight. The House will have a new committee, the financial services regulators committee, which I suspect will need to be very diligent as it looks at the FCA’s actions in this area. The FCA will now set the rules for admission to trading on regulated markets, on MTFs operating primary markets and what will now be classed as public offer platforms. Only the broad concept of a prospectus will remain in legislation. I ask the Minister to explain the additional resources that will be given to the FCA to police what are, frankly, difficult and complex waters.
I also ask the Minister to explain the compensation mechanism where there is misleading or incorrect information in a prospectus or in any other required document. I am particularly keen to know what happens if a company with a false prospectus or alternative document falls into bankruptcy, and whether the FCA or a court could remove investors’ rights of private redress, if a scheme of arrangement is implemented. I am deriving this from concerns that exist around the Woodford investors and the Link Fund scheme, which will overtake that organisation and appears to threaten the investors’ rights of recourse to either the Financial Ombudsman Service or the Financial Services Compensation Scheme. I am not quite sure how all this works around investors through these various platforms, but I am concerned that, somewhere, the compensation must be protected and not compromised. Perhaps the Minister will help me understand that part of the process.
Can the Minister expand a little more on the protections in place for offers of securities made through the renamed public offer platforms? As she said, they are essentially crowdfunding platforms. Typically, crowdfunding platforms have been caveat emptor, and I am trying to understand what protections will now be in place, especially as the requirement for a prospectus for offers over £8 million is being erased. In fact, the pool of companies that can use crowdfunding is now dramatically increased and involves many much bigger players. I fully recognise that we need to find a way to encourage investment in both start-ups and scale-ups if we are to grow the UK economy, but nothing will kill a market faster than a series of scams, especially when the victims turn out to be ordinary people. It is primarily ordinary people who make use of crowdfunding platforms—people who have not been in a position to either understand or evaluate the risks that they are taking.
I notice—the Minister referred to this—that mini-bond issues will now be required to use the public offer platforms. Frankly, that very fact illustrates the FCA’s propensity for closing the stable doors long after the horse has bolted. I understand that this may deal with the mini-bond problem, but what about the problems we do not yet recognise? How will they be captured? Under this new regime, will new scams now have far more room for manoeuvre?
This statutory instrument depends heavily on the FCA’s commitment to consumer protection, but it has been noticeable that the FCA rejected the introduction of a duty of care and opted for a customer duty. Framed largely as a box-ticking exercise, it is less comprehensive than a duty of care and, most importantly, the consumer duty arrangement permits no right of private action, which is perhaps the primary protection that most consumers have when a scam acts on them and they are victimised. Do the Government expect the FCA to apply to protection in this market the same customer duty approach, which is narrow, constrained and very much cuts off a right of private action?
I realise that the Government are determined to persuade ordinary people to take far more risk with their money, and these changes are part of that process. I have no problem with people taking risk, where they have sufficient funds for their own needs and sufficient expertise to understand the risk that they are undertaking. But, frankly, as I read through this SI, I find very little that looks as though it is directed at people with both resources and expertise; it seems to encompass people who may well have neither. We all know that, when they are first marketed, risky ventures look extremely good. It is only after time that people find out the pitfalls.
I am trying to get from the Government some sense of whether, when we pass this SI, we will lose control over the protections that will be in place. Will we have any way to challenge the adequacy of those protections? How will we be assured that, given the much greater flexibility and opportunity being offered, we will not lose necessary transparency and protection?
Lord Livermore (Lab)
My Lords, I am very grateful to the Minister for introducing this SI, which we support, at such short notice. I note that the new prospectus regime is not due to come into effect until 2025. In the meantime, the UK’s public markets will continue to be at a competitive disadvantage. Given that the recent Financial Services and Markets Act contained a new competitiveness objective, does the Minister believe that swifter progress could be made on prospectus reform to support the UK’s international competitiveness?
The Explanatory Memorandum accompanying this SI notes that, in relation to regulated markets,
“the FCA will be given enhanced rulemaking responsibilities”—
for example, to set out when a prospectus is required or what it should contain. The EM also notes that the new regime will not come into effect until the FCA has made these new rules. Can the Minister clarify what progress the FCA has so far made and whether she is confident that this will not introduce any further delay to the new prospectus regime taking effect?
Finally, in the Treasury’s initial review of the prospectus regime, the Government committed to introducing a new regime of regulatory deference for offers into the UK of securities listed on certain designated overseas stock markets. The review was published almost two years ago, yet this SI does not introduce that deference mechanism for prospectuses. Can the Minister confirm whether such a regime remains under consideration and, if so, when and how it might be delivered?
Baroness Swinburne (Con)
My Lords, this will be quite fluid; I hope that some more papers will come my way as I start to speak and go through this. In closing, and in response to your Lordships’ remarks, this SI represents an important step in replacing assimilated law. I am really pleased that both noble Lords support the approach to regulation for financial services. We have the ability to tailor this to the UK in what I hope will be a coherent and logical way that will be conducive to UK economic growth in the long run, all of which we all collectively support. This instrument will be an important milestone in providing that improved competitiveness in our capital markets and, we hope, make some of that raising of capital in the UK easier and simpler.
I will turn to some of the very specific questions that noble Lords raised. There is some similarity and overlap between them. On the broad question of whether there is sufficient scrutiny of the new powers that the FCA is being given, those powers were given under the Financial Services and Markets Act. That discussion was had last year and pre-dates my time in this House, unfortunately. The reality is that those powers were given, and I think it is right. I understand the concerns that noble Lords and industry have regarding that unelected regulator having the full powers that it does. However, oversight by parliamentarians is really important. Now that the UK has left the EU, the Government intend to move the UK’s domestic model of financial services regulation so that financial services regulators—not just the FCA—make the detailed regulatory requirements within a framework set by government and Parliament.
It is right that the regulators should take much of the burden of responsibility for making those new rules. However, they need to come back to Parliament regularly with all the details that they are proposing. In fact, one of my noble friend Lord Hill’s key arguments was that the current prospectus regime is overly rigid and inflexible. It sets out very prescriptive rules in primary legislation, which means that when new methods of raising financing come along, the regulators were unable to adapt to them. They were unable to approve something if it was not prescribed in the first level of regulation.
This new burden will involve more work for the FCA and other regulators in due course. Indeed, the FCA has the ability and responsibility to levy the relevant fees to deliver its full responsibilities. I was asked whether it would be given more resources; if it needs more resources, it will raise them through its fees structure. We therefore feel that it is perfectly capable of dealing with the added rules that it will have to prepare. This House will no doubt scrutinise all these rules thoroughly; I am sure that the financial services regulatory committee will do its job thoroughly. I hope that the other place will also play its part in doing so, but I know that your Lordships’ House will do so.
With regard to redress under the scheme of arrangement, there are obviously compensation mechanisms built into this new set of prospectus rules and framework, and these will be protected. We will write with regard to the bankruptcy element of this. I do not have it in my briefing pack, but I will certainly get the noble Baroness, Lady Kramer, a specific answer on that. The noble Baroness is right that the public offer platforms have been caveat emptor up until now. The reality is that they are a very legitimate way of raising funds for businesses in this country. But when they are raising significant amounts of money, it is right that they have the same relative oversight that any other platform would have, whether it is an MTF or an exchange that would be raising capital. This will bring them under the scope of the regulatory framework, as far as the regulators are concerned.
With regard to the delays and the fact that will be in place only by 2025, I totally appreciate that these things take a long time but part of the scrutiny process for the regulators and their new powers is that they have to go through thorough consultation periods for every set of rules that they propose. They will indeed be doing that, and we therefore expect this to be by the first half of 2025.
On deference, the Government have published the outcome of their conclusion on the reforms to the prospectus regime and committed, in line with the stakeholder feedback, to prioritise the reforms taken forward in this SI. This note is supposed to be about deference and I am still trying to read it. I will write to the noble Lord, Lord Livermore, as I am not sure this will answer the question that he put to me with regard to that overseas deference mechanism. I will respond to that further. In the meantime, I apologise if this response was not as thorough as it needed to be.
Online Safety (List of Overseas Regulators) Regulations 2024
(11 months ago)
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Viscount Camrose
That the Grand Committee do consider the Online Safety (List of Overseas Regulators) Regulations 2024.
Relevant document: 6th Report from the Secondary Legislation Scrutiny Committee
The Parliamentary Under-Secretary of State, Department for Science, Innovation and Technology (Viscount Camrose) (Con)
My Lords, these draft regulations were laid before the House on 28 November last year. I am delighted that our ground-breaking online safety legislation is now on the statute book as the Online Safety Act 2023. I am sincerely grateful to noble Lords for their campaigning and collaboration throughout its passage. It is crucial that the Act is fully operational as quickly as possible; the Government are working at pace to deliver on this ambition. The statutory instrument being debated today is one of several that will enable the implementation of the Act by Ofcom.
This statutory instrument concerns Ofcom’s co-operation with and disclosure of information to overseas online safety regulators under Section 114 of the Act. The service providers that are regulated under the Act are global in nature. It is therefore vital that Ofcom can co-operate and share information with its regulatory counterparts in other jurisdictions to support co-ordinated international online safety regulation. In certain circumstances, it may be appropriate for Ofcom to support overseas regulators in carrying out their regulatory functions. For example, it may be beneficial for Ofcom to share information it holds to inform supervisory activity or an investigation being carried out by an overseas regulator. This could support successful enforcement action overseas, which could in turn have direct or indirect benefits for UK users such as preventing malign actors disseminating illegal content on regulated services.
In addition, international collaboration will increase the efficiency of online safety regulation. Ofcom and its international counterparts will be able to gather extensive information about regulated service providers in the carrying out of their functions. In some instances, it is likely to be more efficient for regulators to gather information directly where that information has already been gathered by an overseas regulator. As such, international regulatory co-operation and co-ordination are likely to reduce the regulatory burden on both international regulators and regulated service providers.
It is for these reasons that Section 114 of the Act builds on the existing information gateways available to Ofcom under the Communications Act 2003 by permitting Ofcom to co-operate with an overseas regulator for specified purposes. This includes powers to disclose online safety information to a regulator, either for the purposes of facilitating the overseas regulator in exercising its online regulatory functions or for criminal investigations or proceedings related to the overseas regulator’s online regulatory functions. In the absence of Section 114, Ofcom could not share information for these specified purposes under the existing information gateway under the Communications Act 2003. Under Section 1(3) of the Communications Act, Ofcom can share information only for the purpose of carrying out its functions, subject to the general restrictions on the disclosure of information under Section 393 of that Act.
Subject to your Lordships’ approval, this statutory instrument designates the overseas regulators that Ofcom can co-operate and share information with under Section 114 of the Online Safety Act as follows: Arcom in France; the Netherlands Authority for Consumers and Markets; the Federal Network Agency in Germany; the Media Commission in Ireland; the eSafety Commissioner in Australia; and the European Commission. The department consulted with Ofcom, and carefully considered its operational needs and existing relationships, when compiling the list of the overseas regulators to be specified. This will mean that the designated regulators are those with which Ofcom will be able to share information in an efficient and mutually beneficial manner. It is important to note that Ofcom would retain discretion over whether to co-operate and share information with the overseas regulators specified.
In order to ensure that any information sharing is proportionate, we have also considered whether the overseas regulator is a designated regulator of a bespoke online safety regulatory framework. Ensuring the protection of fundamental freedoms online has also been a key consideration. As such, we have considered whether the regulator’s autonomy is protected in law and whether the overseas regulator, as well as the jurisdiction that empowers it, upholds international human rights.
It is important to recognise that Ofcom is experienced in handling confidential and sensitive information obtained from the services it regulates and that there are strong legislative safeguards and limitations on the disclosure of such material. Overseas regulators receiving any information from Ofcom may use it only for the purpose for which it was disclosed. They may not use it for another purpose, or further disclose it, without express permission from Ofcom or unless ordered by a court or tribunal. Further to this, Ofcom must comply with UK data protection law and would need to show that the processing of any personal data was necessary for a lawful purpose. As a public body, Ofcom is also required to act compatibly with the Article 8 right to privacy under the European Convention on Human Rights.
We will continue to review this list of designated regulators, particularly as new online safety regimes are developed and operationalised around the world. I would like to open this matter for debate.
Lord Clement-Jones (LD)
My Lords, I thank the Minister for his introduction. We all welcome the fact that the Bill is now an Act, of course. In a sense, these regulations are the first swallow of spring. We have many more affirmative SIs to come, I have no doubt, along with the codes of conduct that will eventually come to us in their final form. Like the Minister, I very much hope that we will proceed at speed in how we implement the terms of the Act.
Although this SI looks quite narrow in what it is about, it raises the whole question of co-operation between regulators. It is not just going to be about Ofcom helping overseas regulators, as set out in the regulations, in what they do; obviously, the Communications Act provisions will be important as well. It would be useful if the Minister could give us an idea of the areas of co-operation between the regulators that he thinks would be particularly fruitful. For instance, relationships with the Irish regulator will be extremely important in understanding how the DSA is working for it. How might its redress mechanism work? The DSA has explicit redress mechanisms under it whereas we are going to be working towards that in future; that is quite a long way away.
As the Minister will recall, other aspects are still somewhat inchoate under the Act. There is the question of research, which is an important area. How is that working? How are the other regulators seeing it operate? There is also the app store aspect, the other area of the Act that is not quite there in the way that its other parts are. It would be useful if the Minister could give us an idea of the areas that Ofcom will be working on.
I very much welcome the Minister’s assurances about the use of personal data and the kind of information that will be available. I assume that this will be of some importance, and that these case studies will involve some of the category 1 platforms to be discussed between the regulators. They will be helpful in making sure that, on an international basis, we see conformity by these large platforms to the kinds of regulation that are being installed. Does the Minister have an idea about the scale of the exchange of information that will be required? Clearly, it will require some resource by Ofcom in making security absolutely certain and being able to deliver on the assurances that the Minister has given.
Finally, it would be interesting to hear from the Minister whether other candidates will be coming down the track. Clearly, this instrument sets out the key regulators. Might others come along that are a speck in the eye, or does the Minister think that we have pretty much settled who the key regulators are and that, for the moment, they will be the ones with which we will co-operate under the terms of this SI?
Lord Stevenson of Balmacara (Lab)
My Lords, I join the noble Lord, Lord Clement-Jones, in welcoming this SI, and I thank the Minister for his kind comments about the work that went into the Bill. I share with him our pleasure that it is now in force and up and running; this instrument is proof positive that it is indeed so. Like the noble Lord, Lord Clement-Jones, I have many questions about what is happening, but certainly no objections to what is proposed.
The helpful Explanatory Memorandum explains that the context for this instrument is
“the global nature of service providers”
and how they operate. In that sense, I recognise that there are some gaps as regards the areas from where difficulties and troubles might come. For instance, Poland and parts of the eastern European bloc are thought to be centres from which emanate quite a lot of damage and a certain amount of material that is almost certainly illegal, yet I see no reference to any organisation—maybe there is none—that might be able to help Ofcom explore what is happening there. I am also concerned about Canada, because it hosts the biggest—I think—pornography company in the world. Again, I would have thought it would be helpful to Ofcom to be able to contact a collaborative organisation in Canada to work with, but I do not see one in the list.
That leads me on to another, related point. There is, and has been for some time, a network of likeminded organisations with which Ofcom has worked well in the past. There is a list of them on its website. Not all of them are in the Government’s proposals before us, and I wonder whether that in any way reflects a clash of views by the Government. Perhaps the Minster will comment on why we do not see Korea or South Africa, for instance. I would have thought that at least those with which Ofcom has a good working relationship at the moment should have been close to appointment. Perhaps there is some sort of competition there or element that I am not aware of. Any light that could be shed on that would be helpful.
Paragraph 7.5 of the Explanatory Memorandum attached to the SI very helpfully specifies that these regulations have certain minimum standards by which they are judged—a point picked up by the noble Lord, Lord Clement-Jones. I felt they were very appropriate to the ones that the Minister mentioned, including the bespoke regulatory framework itself,
“whether its autonomy is protected in law; and whether the … jurisdiction that empowers them, upholds international human rights”.
These are all good things, and I am pleased to see them mentioned in the Explanatory Memorandum and referenced in his speech.
That raises the question: what happens if any of these organisations depart from these standards? Will another procedure or SI be required to remove them from the list, or would they just cease to be part of the group with which Ofcom discusses things? It would be helpful to have on the record some idea of what the procedure would be if that were required.
My last two points are relatively small. There is a hint that more regulators will be considered and brought forward. That is good; I think we are all in favour of more places, since, as has been said, this is a global issue. What is the timing of that, roughly? Perhaps we could have some speculative ideas about it.
Finally, as the noble Lord, Lord Clement-Jones, pointed out, this is the first of many SIs coming forward for consideration by the House. In Committee on the Bill, we discussed at length how Parliament could be involved. This SI is probably not a very good example of that, but in the codes of practice considerable work will be required by Parliament to make sure that the affirmative resolutions are properly researched and discussed.
The proposal we made, which was accepted by the noble Viscount’s colleague, the noble Lord, Lord Parkinson, was the Parkinson rule: that the statutory instruments would, in fact, be offered to the standing committees. I do not think that would have been necessary for this instrument; I just wonder whether that is still in progress and whether it is the Government’s intention to honour the idea announced at the Dispatch Box that the legwork for many of the substantial SIs that will come forward could be done with advantage by the committees, which would inform the debates required in both Houses before these instruments can be approved. I look forward to hearing from the noble Viscount whether that is likely to happen.
Viscount Camrose (Con)
As ever, I thank noble Lords for their valuable contributions to this debate. Needless to say, it is vital that we recognise the global nature of regulated service providers under the Online Safety Act. This SI will ensure that Ofcom can co-operate and share online safety information with specified overseas regulators where appropriate.
As set out, we will review on an ongoing basis whether it is desirable and appropriate to add further overseas regulators to the list. That is an ongoing activity. I anticipate that, as more and more jurisdictions enter the online safety regulation business, we will see an acceleration of the rate at which they can join on the lines we have set out.
I will now respond to some of the specific questions raised in the debate. The noble Lord, Lord Clement-Jones, asked about the types of information that Ofcom might share using this mechanism. The Government anticipate Ofcom being able to share information and co-operate with other regulators, which will lead to international regulatory co-operation, which is likely to reduce the regulatory burden on Ofcom, as well as international counterparts—for example, in relation to duties that are quite similar between regulators, such as duties to deal with illegal content. I anticipate that being a particular focus of their co-operative activities.
Positive benefits may also result from Ofcom supporting overseas regulators in carrying out their online safety regulatory functions and co-operating with relevant criminal investigations or proceedings. That co-operation might address a source of harm for UK users—for example, preventing malign actors disseminating suicide and self-harm content on regulated services.
Regarding the scale of the exchange, Ofcom itself would have discretion as to the scale of the information sharing that takes place through these provisions. However, it is likely to be beneficial to both Ofcom and its regulatory counterparts to engage in information exchange of this nature.
On the question from the noble Lord, Lord Stevenson, on why certain regulators have not been added, we will of course work closely with Ofcom and other stakeholders. He raised a number of interesting examples that would have been quite tempting to add to the list of criteria applied by us, which we, along with Ofcom, produced for the time being but on an ongoing basis. The intention is to review that to add other regulators that can add value in this way.
Lord Clement-Jones (LD)
My Lords, the Minister raised a very interesting point. He said “criteria”; I do not think we have quite heard what those criteria are. That would be very interesting so that we can gauge for the future whether the possibilities that the noble Lord, Lord Stevenson, raised are real possibilities.
Viscount Camrose (Con)
Indeed. Perhaps noble Lords will forgive me if I restate “criteria” as “factors considered”, because they are less algorithmic in that sense. Those factors considered would have been an existing relationship or ways of working together; bespoke online safety laws with a bespoke online safety regulator designated to those laws; regulatory autonomy, as I said; and, of course, a regulator within a jurisdiction committed to upholding human rights laws. I should add that the precise nature of any co-operation with any of the regulators on the list remains the decision of Ofcom and not the Government.
To address the question from the noble Lord, Lord Stevenson of Balmacara, about whether further statutory instruments will be required to remove overseas regulators from the list, I can confirm that this is the case. I hope that noble Lords agree with me on the importance of implementing the Online Safety Act as swiftly as possible. Therefore, I commend these regulations to the Committee.
Lord Stevenson of Balmacara (Lab)
Can I press the Minister on the point I made at the end? Will the generic approach to SIs in future be that they are offered to the standing and Select Committees of the two Houses before they are brought forward for consideration?
Viscount Camrose (Con)
I will commit to going away and thinking about that one, because I feel that is a broader question about parliamentary oversight of regulation in general—if I have understood right.
Lord Stevenson of Balmacara (Lab)
It certainly can be taken that way, but actually it was a rather narrow question. His colleague, the noble Lord, Lord Parkinson, gave a statement at the Dispatch Box that the Government would use their maximum efforts to ensure that the two Select Committees—the DSIT Select Committee in the Commons and the Communications and Digital Committee in the Lords—would have the chance to look at draft SIs before they came forward. It is certainly more work, and we do not want that, but it would make it much easier for the Houses to be able to respond positively and accurately as they go forward.
Viscount Camrose (Con)
I apologise to the noble Lord; I misunderstood. I very much see the value of this and will strain my sinews to deliver just that. Meanwhile, I commend these regulations to the Committee.
Lord Clement-Jones (LD)
My Lords, before the Minister finally sits down, I want to put to him a very interesting question raised by my noble friend, who the Minister knows is extremely expert on these matters. Is this purely regulators for sovereign Governments or is there flexibility so that, for instance, a US state such as California, which has a particularly powerful governance regime and a strong regulator—it hits the criteria the Minister stated, other than being a sovereign country—could possibly be added to the list under these powers?
Viscount Camrose (Con)
I think we would continue to entertain the possibility. That is why I slightly withdrew from the word “criteria” and went to “factors under consideration”—so that we would have the ability to adapt to such opportunities as might arise.
Misuse of Drugs Act 1971 (Amendment) Order 2024
(11 months ago)
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Lord Sharpe of Epsom
That the Grand Committee do consider the Misuse of Drugs Act 1971 (Amendment) Order 2024.
Relevant document: 7th Report from the Secondary Legislation Scrutiny Committee
The Parliamentary Under-Secretary of State, Home Office (Lord Sharpe of Epsom) (Con)
My Lords, this draft order, which was laid before Parliament on 27 November last year, proposes amendments to the Misuse of Drugs Act 1971 to control 15 substances as class A drugs, four substances as class B drugs and one substance as a class C drug. To achieve this, it proposes amendments to Schedule 2 to that Act, which sets out what drugs are controlled and their classification.
Fifteen synthetic opioids, including 14 nitazenes, will be controlled as class A drugs under the 1971 Act. This follows recommendations from the Advisory Council on the Misuse of Drugs in its report of 18 July 2022 and addenda of 19 December 2022 and 6 October 2023. The Government commissioned the ACMD for its advice following international control of three of the synthetic opioids—at this point, I beg noble Lords’ indulgence because pronouncing some of these names is not easy; they are isotonitazene, metonitazene and brorphine—under Schedule 1 to the United Nations Single Convention on Narcotic Drugs 1961, to which the UK is a signatory.
In addition to reviewing these substances, the ACMD considered the harms of other similar synthetic opioids and concluded that they pose serious acute health risks, reinforced by reports of their involvement in a number of drug-related deaths and near-fatal overdoses. The ACMD determined that their potency and availability present a significant potential threat to public health and therefore recommended the highest level of control as class A drugs under the 1971 Act. This is for all 15 synthetic opioids, including the three controlled internationally.
Additionally, three stimulants—diphenidine, ephenidine and methoxyphenidine—will be controlled as class B drugs under the 1971 Act by this order. This follows international control of diphenidine under Schedule 2 to the United Nations Convention on Psychotropic Substances 1971 in April 2021, after which the Government commissioned the ACMD to review its harms. In its report of 25 May 2023, the ACMD noted the involvement of these substances in a number of drug-related deaths worldwide and recommended that they be controlled as class B drugs under the 1971 Act. This is in line with similar dissociative class B drugs, such as ketamine.
Also to be controlled as a class B drug is Cumyl-PeGaClone, a synthetic cannabinoid receptor agonist—SCRA—which, similarly to diphenidine, was added to Schedule 2 to the United Nations Convention on Psychotropic Substances 1971 in April 2021. Many SCRAs are currently controlled as class B drugs under a generic definition in the 1971 Act. However, owing to its structure, Cumyl-PeGaClone falls outside the generic definition. The ACMD report of 25 May 2023 recommended that the Government consult relevant stakeholders on modification to the definition, which the Government have agreed to do. In the meantime, to address the harm it poses and meet our international obligations more quickly, the Government have opted to control Cumyl-PeGaClone individually as a class B drug, in line with other SCRAs. We will consult on modifications to the generic definition in due course.
Finally, remimazolam, a benzodiazepine, will be controlled as a class C drug under the 1971 Act. Remimazolam is the active ingredient in a product given marketing authorisation, otherwise known as a medicines licence, by the Medicines and Healthcare products Regulatory Agency in 2021. The ACMD recommended in December 2022 that it should be controlled as a class C drug as its potential harms are commensurate with other benzodiazepine drugs already controlled under class C.
I am grateful to the ACMD for the comprehensive reports it has produced. Those reports have been the foundation of this legislation. According to the ACMD’s advice, all the substances are psychoactive and therefore potentially subject to the offences under the Psychoactive Substances Act 2016. The 2016 Act contains offences for the production, supply, possession with intent to supply, import or export of a psychoactive substance where a person knows, or is reckless as to whether, it will be consumed for its psychoactive effects. It does not, however, contain an offence for the simple possession of a psychoactive substance, other than in a custodial setting. Medicinal products are exempt from the provisions of the 2016 Act, and medicines based on remimazolam are therefore currently exempt.
The control of these substances under the 1971 Act would make it an offence to possess them and impose higher penalties and enforcement provisions for supply and production offences. Those found in unlawful possession of a class A drug could face up to seven years in prison, an unlimited fine or both. Meanwhile, those who supply or produce a class A drug could face up to life imprisonment, an unlimited fine or both.
One of the substances, remimazolam, has a known medicinal value in the UK as it has been granted a marketing authorisation. To enable its use in healthcare, remimazolam will be placed in part 1 of Schedule 4 to the Misuse of Drugs Regulations 2001 by a statutory instrument made under the negative procedure. It is the Government’s intention that it will come into force on the same date as this affirmative order. The other 19 substances will be placed in Schedule 1 to the 2001 regulations by that same negative statutory instrument. This is because they have no known medical or therapeutic value in the UK and will mean that they can ordinarily be accessed only under a Home Office-controlled drug licence. Again, this follows ACMD advice. Cumyl-PeGaClone will also be placed in Schedule 1, in line with other SCRAs already controlled under the 1971 Act and 2001 regulations.
These substances, excluding remimazolam, will therefore be added to part 1 of Schedule 1 to the Misuse of Drugs (Designation) (England, Wales and Scotland) Order 2015. Controlled drugs are designated where the Secretary of State is of the opinion that it is in the public interest for production, supply and possession of that drug to be wholly unlawful or unlawful except for research or other special purposes, or for medicinal use of the drug to be unlawful except under licence.
Drug misuse ruins lives and adversely affects society as a whole. The Government have a responsibility to protect the public, their safety and their health, and that is why we are proposing this action. As I have set out, these substances cause or have the potential to cause significant harm to both the individual who uses them and the communities in which they live, and must be subject to stricter controls. I commend this order to the Committee.
Lord Allan of Hallam (LD)
My Lords, in speaking for these Benches I would ordinarily speak from a health perspective. From our point of view, a lot of the drug abuse issues fall within that category. We are obviously dealing with a Home Office statutory instrument today, but I hope that the Minister will indulge me if I put some questions that come from that angle of considering the impact on individuals of the drugs we are due to control.
The first is around how we will monitor, in particular, the prevalence of the synthetic opioids that are to be classified by the instrument we are considering. I think we have all looked in horror at the situation in the United States, where the firewall that exists between heroin and other forms of drugs has broken down, in a sense, through the distribution of synthetic opioids to a much broader demographic who, it seems, feels more comfortable taking them than would feel comfortable taking heroin. But the medical harm is just as severe—in some cases, more severe—so I will be interested to hear from the Minister how the Government intend to monitor the prevalence and usage, particularly across different demographics, of these synthetic opioids, as well as prohibiting them, which is right. It is correct that we are following the advice of the advisory council here, but also really important that we understand the way in which these synthetic opioids are being consumed within the community.
The second issue I want to raise follows on from that, which is to consider how treatment services will deal with people who present because they have an addiction to the drugs we are considering. The numbers are quite stark: in 2021-22, just over 289,000 people presented for treatment services. Nearly half of them presented for opiate addictions and over 70% had mental health problems. It is critical to understand, as we broaden the net on the drugs that we bring into scope, how we will be able to respond to the people who come to the attention of the authorities because they are using these opiates—and get them off those. Just as important as any attempt to ensure that they are prosecuted is to get them out of that drug dependency and back into a normal state. Again, I want to understand what consideration has been given to how treatment services will need to be adapted to cover this broader range of synthetic opiates that we are bringing into scope.
Lord Ponsonby of Shulbrede (Lab)
My Lords, we too welcome the amendments in this instrument. I will start with two specific questions and then make some more general comments.
First, beyond adding the specific substances which the Minister referred to in his speech and in the document, what more are the Government doing to address the risks posed to our communities from drugs more generally? The second question is about a particular drug, xylazine, a non-opioid veterinary anaesthetic that is being used in combination with synthetic opioids to devastating effect. I understand that the Minister for Crime wrote to the ACMD in June to ask it to consider the harms of this drug and that he is still waiting for a response. How long should the Minister for Crime expect to wait before he gets either action or a response to his letter about this drug?
Those are my two particular questions. More generally, I want to use the same structure as the noble Lord, Lord Allan. The first question he asked was about monitoring the prevalence and usage of synthetic opioids. As I mentioned in other speeches, including in the King’s Speech debate, I travelled to North America in the summer and went to Portland, Oregon. I also went to Seattle in Washington state. I was shocked by the amount of drug use on the streets. I saw hundreds if not thousands of people sleeping rough on the streets of those two cities. I saw people shooting up in front of me in the middle of those cities—and I had young children with me. It was a truly shocking sight.
While I was there, I visited a court that dealt with drug issues. I also had breakfast with a district attorney who is an elected prosecutor. We spoke about the way their current drug policy is working. What was interesting and depressing to me was the uniform agreement across the political spectrum that it was a disaster, yet they did not agree on the solution to that disaster; there was an ongoing political debate on it. The district attorney also said to me—it is relevant to this debate—that there is a strong suspicion, or belief, that synthetic opioids are getting into prescribed drugs. He told me that he had gone on holiday to Mexico but had forgotten some of his normal prescription drugs, so he had to go and buy the drugs while in Mexico. He became aware that synthetic opioids are illegitimately getting into prescribed drugs. This is a very worrying development; it is all over the internet in that part of the world. It is something that we should be aware of as a possible problem over here as well. It really is a huge issue. I am sure that the Minister is aware of it, but it would be good to hear what is being done to monitor the scale of this problem, which is potentially coming our way.
The second point made by the noble Lord, Lord Allan, was about treatment services and more drugs being brought into scope. I am quite worried about the experiments being carried out in Glasgow. I suppose that would be a good question for the Minister to answer: what monitoring are the UK Government doing on the experiments being done around drug treatment centres in Glasgow? I will leave it there.
Lord Sharpe of Epsom (Con)
My Lords, I thank both noble Lords for their contributions to this short debate. I take on board the personal experience of the noble Lord, Lord Ponsonby, in the States; his observations are obviously extremely interesting. Perhaps it is worth pointing out that just under half of all drug poisoning deaths registered in this country in 2022 already involved an opiate of some sort. The noble Lord made some acute points; of course, the Government remain aware of the situation overseas and continue to monitor that as much as they monitor the situation here.
The noble Lord, Lord Ponsonby, asked me a specific question about xylazine. The ACMD is independent, so I cannot comment on its timeframes, but we are hoping for its response on this particular drug in early 2024. Obviously, we will come back to this as and when we have its response.
The noble Lord, Lord Allan, asked about monitoring and the noble Lord, Lord Ponsonby, backed that up. As I said, UK agencies are highly alert to the threat from synthetic drugs, including synthetic opioids such as fentanyl as well as synthetic cannabinoids and benzo- diazepines, which have been linked to drug-related deaths in this country. Along with law enforcement partners, the UK Government stand ready to respond to the threat from synthetic drugs. They have established a cross-government task force to monitor that threat and to lead and co-ordinate the government response to the risk from these synthetic opioids in the UK. The aim of the task force is to consider evidence-based policy; programmatic and legislative decisions in response to the level of risk; and the nature of synthetic opioids. Members of the task force include the Home Office, the Office for Health Improvement and Disparities, the Ministry of Justice, the National Crime Agency, HM Prison and Probation Service, Border Force and the police.
Through the UK’s drugs strategy, which was published in December 2021, we are implementing an end-to-end plan to disrupt the supply of all drugs at every stage of the supply chain from a source to the street. As part of that strategy, we have provided additional resources to the international networks of the NCA and the Home Office in key source and transit countries; this is for them to work with other Governments in identifying and disrupting cartels that seek to exploit the UK, as well as to seize drugs before and during their journey to the UK and the EU.
Also outlined in the strategy, we have increased the availability of naloxone, including naloxone nasal spray, to prevent drug-related deaths, and have committed to supporting local provision of a broader range of medicines, including newer medicines such as long-acting buprenorphine injection. We believe firmly in the importance of engaging with experts and delivery partners to respond swiftly to the evidence of emerging drug threats, including learning from international partners through international fora such as the US-led Global Coalition to Address Synthetic Drug Threats.
On the health situation that was brought up by both noble Lords, FRANK, the Government’s free drugs advice service, contains information on synthetic opioids, synthetic cannabinoids and benzodiazepines, which will be updated to reflect the changes when this legislation comes into force. The Department for Education has also worked with the Office for Health Improvement and Disparities to make sure that good-quality teaching resources are available for teachers providing drug, alcohol and tobacco education, and lesson plans on drugs, alcohol and tobacco are available on the PSHE Association website.
We are of course concerned that banning these substances will discourage people from access to treatment services, but the Government’s drugs strategy, From Harm to Hope, published in December 2021, is clear about the Government’s ambition to achieve stigma-free treatment, providing the full, positive impact of treatment services for those seeking help. But, noting the potential harms associated with misuse of these substances, we believe it is necessary to take action to restrict access to these drugs and reduce their misuse. Through the drugs strategy, we are investing more than £2.8 billion over three years to support people through treatment and recovery, which includes support for those who have used a range of drugs and suffered various health harms.
Of course, key to all this is reducing the demand for drugs. We are committed to reversing the rising trend of drug use in society, to protect vulnerable people from harm and exploitation. It enables us to keep our communities safe and we must therefore reduce the demand for drugs, which fuel violence and exploitative criminal markets. Around 3 million people in England and Wales report using drugs each year, putting themselves at risk and driving a violent and exploitative supply chain, including through so-called recreational drug use. Through programmes announced as part of the drugs strategy, such as drug testing on arrest, and our plans to roll out pilots to change behaviour and attitudes towards drug use, we will provide the powers and access to appropriate interventions and support. We also know that we need to step up action in addressing the visible forms of drug use within our communities, so we will work with our enforcement partners to see what more we can do to tackle this, while ensuring that those who need treatment and support are diverted into the appropriate services.
The noble Lord, Lord Allan, asked a very specific question about remimazolam. There are no known established legitimate uses for any of these substances except remimazolam. The Government recognise the importance of ensuring that that in particular remains available for legitimate and lawful purposes, so in line with the recommendations from the ACMD, remimazolam will be placed in part 1 of Schedule 4 to the 2001 regulations, as I said in my opening remarks. That will enable lawful access in healthcare settings, subject to the requirements of the 2001 regulations. The remaining 19 substances will be placed in Schedule 1, as I mentioned, and access will therefore be permitted only under a Home Office-controlled drug licence. That will ensure that organisations can still lawfully undertake research with these substances, should they choose to do so.
On the specific question about paramedics, that is a Department for Health situation: it would have to request that paramedics be able to prescribe or use this drug in the appropriate way. I hope that answers the questions that I have been asked and, again, I thank both noble Lords for their participation in this debate. These are dangerous substances with the potential to cause significant harm, and they should therefore be subject to the strict controls under the 1971 Act. With that, I commend this order to the Committee.
Lord Ponsonby of Shulbrede (Lab)
I specifically asked about the Glasgow drug consumption rooms and whether there is a UK oversight of the way they are operating, rather than just a Scottish Government oversight.
Lord Sharpe of Epsom (Con)
With apologies, I forgot that question and, as it happens, I also do not know the answer—so I will have to find out and write to the noble Lord.
Immigration Act 2014 (Residential Accommodation) (Maximum Penalty) Order 2023
(11 months ago)
Grand CommitteeRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Sharpe of Epsom
That the Grand Committee do consider the Immigration Act 2014 (Residential Accommodation) (Maximum Penalty) Order 2023 and the Immigration (Employment of Adults Subject to Immigration Control) (Maximum Penalty) (Amendment) Order 2023.
Relevant document: 5th Report from the Secondary Legislation Scrutiny Committee
The Parliamentary Under-Secretary of State, Home Office (Lord Sharpe of Epsom) (Con)
My Lords, the first instrument for noble Lords to consider in this single debate is the Immigration (Employment of Adults Subject to Immigration Control) (Maximum Penalty) (Amendment) Order 2023.
The Home Office is the first line of enforcement against illegal migration and works across government to prevent individuals without lawful status in the UK accessing work, benefits and services. Illegal working often results in abusive and exploitative behaviour, the mistreatment of unlawful migrant workers and revenue evasion. It can undercut legitimate businesses and have an adverse impact on the employment opportunities of people who are lawfully in the UK.
Employers have a role to play in ensuring that all their employees have the right to work in the UK. Since 2008, this has been underpinned by the right-to-work civil penalty scheme, under which employers are required to carry out prescribed checks on individuals before employing them. This is to ensure that they are lawfully allowed to work in the UK. If an employer employs somebody who does not have the right to work in the UK, they may be liable for a civil penalty. Employers can avoid liability for a civil penalty if the correct right-to-work checks are carried out before the individual commences employment.
The level of civil penalty for non-compliance has remained the same since 2014, diluting its impact as a deterrent to those who facilitate illegal working, including instances of labour exploitation. Accordingly, the Government intend to increase the civil penalty for employers from £20,000 to £60,000, by virtue of the Immigration (Employment of Adults Subject to Immigration Control) (Maximum Penalty) (Amendment) Order 2023.
This will ensure that the scheme continues to act as a deterrent in respect of employers who employ illegal migrants and send a clear message that only individuals with a right to work in the UK can secure employment. In the case of a first breach, the starting point is £45,000. Employers who elect to pay the penalty via the fast payment option will benefit from a further 30% reduction in the overall amount, after reductions have been applied for any specified mitigating factors.
It remains a criminal offence for migrants to work illegally in the UK, or where the individual is in the UK unlawfully. The offence of working illegally carries a maximum penalty of 51 weeks’ imprisonment in England and Wales and six months’ imprisonment in Scotland and Northern Ireland, or a fine.
The second instrument for noble Lords to consider in this single debate is the Immigration Act 2014 (Residential Accommodation) (Maximum Penalty) Order 2023, which will be in force in England only.
Since 2014, anyone offering rental accommodation in the private rented sector should carry out checks on new adult occupiers before renting to them. This is to check that the individual has the right to rent, and is commonly known as the right-to-rent scheme. Allowing those without a lawful right to be in the UK to rent property enables them to establish a settled life in the UK. This creates costs to the public purse, including through the provision of local authority support, and reduces the amount of housing stock available to those who are lawfully residing in the UK. It often allows abusive and exploitative behaviour, with rogue landlords housing unlawful migrants in unsafe accommodation.
The maximum civil penalty for landlords, including letting agents, will be raised—by virtue of the Immigration Act 2014 (Residential Accommodation) (Maximum Penalty) Order 2023—from £3,000 to £20,000. In the case of a first breach, the starting point is £10,000. Landlords and letting agents who elect to pay the penalty via the fast payment option will benefit from a 30% reduction, from £10,000 to £7,000 or from £5,000 to £3,500 as applicable. As is the case now, the maximum penalty will be levied only on an employer, landlord or letting agent who has breached one of the schemes on more than one occasion in a three-year period, where the fast payment option was not utilised and where no specified mitigating factors apply.
Employers, landlords and letting agents can also appeal a civil penalty decision if, following an objection to the Home Office, that decision has been upheld. An appeal must be on the same grounds as the objection and an employer, landlord or letting agent must make the appeal within 28 days, registering it at a county court or sheriff’s court. This allows accidental non-compliant employers, landlords or letting agents safeguards against penalties.
In summary, these draft orders aim to change the behaviour of rogue employers, landlords and letting agents; to eliminate any financial gain or benefit from non-compliance; to tackle the harm caused by regulatory non-compliance where appropriate; and to deter future non-compliance. I therefore commend them to the Committee.
Lord Lilley (Con)
My Lords, these regulations are a regrettable consequence of our failure to prevent—it is extremely difficult to prevent—deter or remove illegal immigrants from this country. I hope that the Rwanda Bill, which we will consider shortly, will belatedly change that situation.
The reason why I have chosen to intervene briefly in this debate is to seek information. When I was the Secretary of State for DSS, I was told that it was impossible to work legally in this country without a national insurance number—a NINo. You cannot get a national insurance number unless you can demonstrate the legal right to work. It then emerged that there were far more national insurance numbers than people of working age in this country. Various explanations were put forward—they were numbers of people who had emigrated and the numbers were not rescinded, and so on.
First, I want to know whether that issue has been cleared up. Can my noble friend the Minister confirm that it is necessary to have a national insurance number to be employed? The employer has to ask for it and obtain it; it will then go into the system and, if the number is invalid, it will be thrown out. Secondly, is it possible in any way to obtain a national insurance number if you do not have the legal right to work? Are those two aspects effective in preventing illegal immigrants obtaining legal employment or accessing benefits? I appreciate that they will not stop people employing people illegally and failing to report that to the authorities, the tax authorities and so on.
I appreciate that my noble friend may not have the answers to those questions here and now but it would be helpful if we could clear this up and put on the record the precise effectiveness of national insurance numbers in dealing with these issues.
Lord German (LD)
My Lords, the purpose of these two orders is to create a more hostile environment for those who seek to enter this country by routes other than the ones that are available to them, which are very limited indeed. I have a range of questions but my principal concern regards the perverse impact of these orders and how they will act as a deterrent to people who are legally entitled to stay in this country, have been given the right to remain and are seeking to establish themselves with a new life here.
My comment is based on the evidence provided to us. There is limited evidence that the current regime is not working. Of course, I understand that one might wish to increase the fees in line with inflation each year, which has not happened for 10 years, but one necessarily has to ask oneself this: if it is working, why does it need this extra change to make it happen? I will come back later to the evidence that the Government have provided. Without that strong evidence, there is an indication to me that this is an income stream for the Government. I am not necessarily going to complain about that but it certainly does not seem absolutely critical to the ambitions laid before it.
I want to look at the perverse impact on those who have been given the right to remain: those who are starting out on a new life here in the United Kingdom and are faced with the difficult, dual challenges of finding both a home and work. In the rented sector in particular, we currently have a housing crisis, with the private rental sector incredibly competitive for renters. Tenant demand for rental property was up by 54% in July last year. In that context, will landlords choose a tenant who may need to go through the right-to-rent checking process and risk a fine? Or will they opt for someone who has the right to rent, such as someone who has a passport versus someone who does not—or, more worryingly, someone who is of a different ethnic background?
This is a similar problem for jobseekers, who require an employer to check their right to work. We have to be live to the fact that certain profiles of people are at risk of discrimination as a result and will find it harder to find accommodation and employment than their white British counterparts. Protections and remedies need to be real and effective, and we need to consider whether this indirect impact is proportionate to achieving the stated aim of the policy: to deter irregular migrants.
The stated aim of the increase in these penalties is an effort to deter irregular migrants from entering the United Kingdom in the first place, as well as to encourage those without legal status to leave the United Kingdom. This policy has now been in force for 10 years, since 2014. Therefore, we should by now have some evidence of whether the policy works—that is, whether it has contributed to a reduction in people remaining in the United Kingdom after their leave has expired or to fewer people entering the United Kingdom without leave in order to work. My first question to the Minister is this: what is the evidence that this policy has had the desired impact on deterrence since it was introduced in 2014?
The Deputy Chairman of Committees (Baroness McIntosh of Hudnall) (Lab)
My Lords, I hesitate to interrupt the noble Lord but there is a Division in the Chamber. The Committee will adjourn for 10 minutes.
Lord German (LD)
I repeat the question I ended with: what is the evidence that this policy has had the desired impact on deterrence since it was introduced in 2014? Last week, I spent some time with a third-sector body that provides support for those with the right to remain in the United Kingdom. I heard direct evidence that, in the competition for rented accommodation, landlords are opting to choose a tenant where there is no need to go through the right to rent checking process and risk a fine. They are opting for someone who can provide the simplest proof of their right to rent. Increasing penalties by so much increases this risk of outlying those who are from a different category of people. It is particularly hurtful because it impacts very much on the bottom end of the rented market sector.
Paragraphs 22, 24 and 43 of the economic note are very instructive to understanding the strength of the evidence. Paragraph 22 says that there is “uncertainty”, paragraph 24 talks about “limited certainty”, and paragraph 43 says that “limited evidence” is available. Is that evidence available?
Secondly, what enforcement action is there against employers and landlords who discriminate against potential employees or potential renters on the basis of nationality or any other protected characteristic? How often has that enforcement been used? In the current housing crisis, where there are many renters for each rental property, to what extent is this policy increasing the barriers for the non-white British population legally in the United Kingdom to access housing?
The Home Office’s equality impact assessment associated with the instruments says:
“Any indirect impact is the result of an employer or landlord choosing to discriminate for which a remedy is likely to be available to the individual under the Equality Act 2010”.
Recently, I saw a sign in a rental agency in east London that said simply “no DWP”. Those of us with long memories will remember signs that said, “No Irish, no blacks”. Given the difficulty of providing proof, what data is there, if any, on the number of people who have used the Equality Act remedy? How will the Home Office keep the impact of this policy on race under review, as it states it will do in its equality impact assessment?
Finally, paragraph 25 of the economic note talks about familiarisation and says, basically, “We don’t need to do anything to inform employers or landlords about this because it’s just a small change and they already know about it”. But given the size of this particular increase in fines, it means there is a case, because we do not have the evidence, for ensuring that those who rent or offer jobs understand the importance of non-discrimination in this whole process.
Creating a hostile environment for those who have been granted leave to remain and who want to contribute to our economy is not an outcome that I would support. I hope the Minister would agree.
Lord Ponsonby of Shulbrede (Lab)
My Lords, on the draft immigration order for employment of adults subject to immigration control, the Labour Party supports the principle of preventing those with no legal right to reside in the UK undertaking paid employment here and implementing penalties that act as real deterrents for employers who deliberately break the law, so we will support the increasing of the penalties from £15,000 to £45,000 per worker for a first offence. However, given the potential impact on employers, the lack of consultation with businesses, especially small businesses, is disappointing. We would argue that it demonstrates, yet again, the lack of a clear, thought-out strategy towards immigration and tackling illegal work.
The draft order on residential accommodation would increase from £3,000 to £20,000 the maximum penalty for renting a property to someone who does not have the right to rent in the UK. Again, there has been a lack of consultation. I repeat the point made by the noble Lord, Lord German: there are known unintended consequences of right-to-rent checks and penalties for breaches. Landlords are keen to avoid large penalties and might discriminate against British nationals and lawful migrants who have the right to rent but who, perhaps because of their race or nationality, face discrimination and difficulty in getting those rentals. The noble Lord asked how this is monitored: is it done through the Equality Act, which is the remedy for landlords who are discriminating against legal people trying to rent? What are the Government doing to monitor this situation and what levels of enforcement are there against landlords who illegally discriminate against particular groups of people?
Lord Sharpe of Epsom (Con)
My Lords, I thank all noble Lords for their contributions to this debate. We can deliver a comprehensive response to tackle illegal migration only if we work with UK employers, landlords and letting agents to deny employment and housing to those without the right to work in this country. Illegal working and renting are the main incentives for illegal migration and often involve exploitation and unfair competition. The civil penalty scheme encourages employers, landlords and letting agents to comply with their obligations to check the right to work and rent of all employees and occupiers, without criminalising those who make a mistake.
Legitimate employers, landlords or letting agents will not face higher costs through increased penalties. The scope of the penalty regime has not changed. Those who continue to act in a legitimate manner, by checking and recording the documents of their employees or tenants, will not be affected by the strengthened penalty regime. I was interested in the comments from the noble Lord, Lord Ponsonby, on consultation. Given what I have just said, who would the noble Lord consult with—those who are legitimately employing and renting or those who are not? I would have thought that would make the consultation a little problematic to set up.
I will try to answer all of the various questions asked of me. On my noble friend Lord Lilley’s question, as I understand it, a national insurance number is not a prerequisite for the right to work. You can prove the right to work alongside another document, such as a birth certificate. This is a DWP matter, so I will commit to taking this to the DWP and ask that department to write on the specifics of his question.
All noble Lords have asked perfectly sensible questions about whether the schemes are discriminatory, because there are risks of that sort of thing. On 21 April 2020, the Court of Appeal found the right-to-rent scheme to be a proportionate means of achieving its legitimate objective of supporting a coherent immigration system in the public interest. As a result, the court considered the scheme to be justified and not in breach of the prohibition on discrimination in Article 14 of the European Convention on Human Rights when read with Article 8, which is the right to respect for private and family life.
The scheme is capable of being operated proportionately by landlords and letting agents in all cases. The very purpose of the statutory code of practice on avoiding unlawful discrimination when conducting checks recognises and seeks to address the risk of discrimination. While there may be discrimination on the part of a minority of landlords and letting agencies, that is because they have chosen not to comply with the spirit of the scheme, whether for their own perceived administrative convenience or some other economic advantage.
We have made it easy to carry out checks digitally, with no requirement for landlords, letting agents or employers to understand the types of documents renters and employees have. In some cases, it is actually easier to bring a migrant into employment or a residential tenancy agreement than a British citizen. We continue to work closely with the rental sector through landlord representative groups and have recently contacted Citizens Advice for further engagement. A considerable amount of work and thought has gone into this and it is governed under the code of practice, which is on GOV.UK.
The noble Lord, Lord German, asked about the economic impact on lawful migrants entering the country. Employers, landlords and letting agents may favour to employ and rent to British and Irish nationals, who they see as low risk as they do not have time-limited leave and do not require further checks. The lawful migrant may therefore choose not to enter the UK. But the Home Office has published the statutory code—it is on GOV.UK—on how to avoid unlawful discrimination when undertaking checks. The guidance clearly stipulates that employers, landlords and letting agents are advised to provide individuals with every opportunity to demonstrate their right to work or rent. They should not discriminate on the basis of nationality, or any of the other protected characteristics. It is clear that those who discriminate are breaking the law.
Employers, landlords and letting agencies are encouraged to familiarise themselves with the guidance and the statutory codes of practice. It is considered that any indirect discrimination in this limb is justified as a proportionate means of achieving a legitimate aim: operating and enforcing a fair immigration system, protecting taxpayer-funded services and protecting vulnerable migrants from exploitation by seeking compliance with regulation.
I have already dealt with the consultation. However, I should also say that the Home Office is not under a duty to consult but, since the proposals to increase the civil penalties were announced in August, it has undertaken proactive, wide-reaching communications with employers, landlords and letting agents. Home Office officials have supported over 30 forum events as of 12 January and reached over 11,000 stakeholders in the sectors. It is clearly wrong for stakeholders to say they have not had an opportunity to be made aware of the Government’s intentions.
We used an economic note instead of an impact assessment because the costs for non-compliant landlords, employers and letting agents were not taken into account, so the better regulation threshold was not met. Our published economic note shows that a total increase of around £16 million might be expected over five years after higher penalties come into force. This is the central scenario and measures receipt changes for the right-to-work and right-to-rent schemes combined. There is uncertainty on this figure for several reasons, including the number of civil penalties issued and the recovery rate to expect for civil penalties of higher values than seen historically.
On enforcement activity, between January 2023 and November 2023, more than 1,400 right-to-work civil penalties were issued; that is an increase of 40% on the same period in 2022. The value of the right-to-work civil penalties issued was more than £26 million, which is 45% more than in the same period in 2022. Between January 2023 and the end of September 2023, 10,509 enforcement visits took place, of which 4,721 were illegal working enforcement visits. In 2022, 6,865 enforcement visits took place, of which 2,808 were illegal working enforcement visits. Illegal working enforcement visits have increased by more than 40% in 2023 from the same period in 2022.
The noble Lord, Lord German, asked where the funds go. They are collected from civil penalties and are required to be paid into the Consolidated Fund after deductions from processing costs.
I think I have dealt with all of the questions. I have committed to write to my noble friend Lord Lilley on the DWP-related matters. Addressing illegal working and renting not only protects the domestic labour and housing market but identifies unscrupulous employers, landlords and letting agents who exploit vulnerable migrants. Equally, it ensures that only those in the UK legally with permission to work and rent are able to do so. On that basis, I commend these orders to the Committee.
Wine (Amendment) (England) Regulations 2024
Lord Harlech
That the Grand Committee do consider the Wine (Amendment) (England) Regulations 2024.
Relevant document: 7th Report from the Secondary Legislation Scrutiny Committee
Lord Harlech (Con)
My Lords, I declare my farming and land management interests as set out in the register. These regulations were laid before this House on 4 December 2023.
The Government are making this legislation to fulfil obligations on the marketing of wine in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership—the CPTPP. This follows the UK signing the protocol of accession last year. This instrument will introduce rules that govern how products marketed as ice wine must be produced and marketed.
Ice wine is a type of dessert wine produced from grapes that have been frozen while still on the vine. Annual global production of ice wine is very small but can yield high-quality wines that sell at premium prices. It is therefore important to make sure that ice wine is marketed correctly to support consumers in their choices. Ice wine is currently not produced domestically but it is imported. The instrument inserts a restriction in Regulation 2019/33 for ice wine where the product can be marketed as ice wine or under similar terms only if the wine is made exclusively from grapes naturally frozen on the vine.
The instrument being debated today applies this restriction in England. For continuity, separate instruments applying to Scotland and Wales are also being made. This type of imported wine will continue to be able to move from Great Britain to Northern Ireland via the Northern Ireland retail movement scheme under the Windsor Framework.
This instrument will also update the list of oenological practices, processes and restrictions that may be used in the production and conservation of wine and other wine products. The changes are intended to improve the quality of wine and are highly technical in nature. For example, they include discontinuous high-pressure processes, which reduce yeast contamination in wine; they therefore reduce reliance on sulphites to preserve the wine and help improve its fermentation.
These changes align with those adopted by the International Organisation of Vine and Wine—the OIV—since 2019 and approved by the UK through our membership of that organisation. The Scottish Government have adopted the same changes and the Welsh Government are in the process of doing so. This will ensure that producers across Great Britain will benefit from the latest technological developments and winemaking practices. Broadly similar provisions already apply in Northern Ireland. This instrument was notified to the World Trade Organization’s Committee on Technical Barriers to Trade and no comments were received.
In summary, this instrument makes technical but necessary changes to the legislation. It will enable the UK to comply with CPTPP commitments and ensure that British wine-makers can use the most up-to-date winemaking techniques. I beg to move.
Baroness Walmsley (LD)
My Lords, noble Lords have many impressive attributes, but being in two places at once in person is not one of them. So, because my noble friend Lady Bakewell of Hardington Mandeville is moving an amendment in the Chamber, the Committee will have to put up with me.
I thank the Minister for his introduction to this statutory instrument. This is the second instrument on the provisions around wine in a short period of time. Is it a trend? Apparently, the Secondary Legislation Scrutiny Committee has had something to say about the SIs in both cases and has drawn them to the attention of the House.
These regulations prohibit the labelling and marketing of wine as ice wine unless the grapes used have been frozen on the vine as opposed to being subject to freezing afterwards. I had always thought that genuine ice wine was exactly that: wine made with grapes frozen naturally on the vine, concentrating the sugar and making the wine both delicious and very expensive.
I understand that these regulations are necessary to fulfil the obligations in the CPTPP, which was signed by the Government in July last year and debated in the Chamber earlier this afternoon. I also understand that Canada is a major producer of ice wine.
This SI applies to wine for the English market only. The Minister mentioned that Scotland and Wales are progressing their own SIs, which will fit in with this one. Can he say when it is likely that those SIs will be in place? There is likely to be considerable confusion if this is not done quickly, as a bottle of wine is easily transported across borders; confusion could result.
There are also likely to be issues around the labelling of ice wine in Northern Ireland, which is subject to the regulations that exist in Europe and not those that will pertain under the CPTPP. Perhaps the Minister can say something about that.
As a member of the International Organisation of Vine and Wine since 2019, the UK now has to abide by the regulations adopted by that organisation, which, according to the Explanatory Memorandum, change on a fairly regular basis. This SI is temporary and likely to change again in 2025 when it will be revoked. Can the Minister provide any clarification on whether Scotland, Wales and Northern Ireland will at that stage have the same regulations as England—or will all four nations be operating under separate arrangements on ice wine? The SLSC raised the issue of confusion around different rules on ice wine being applied across the devolved nations, including for methods of production.
The Explanatory Memorandum, at paragraph 11.1, indicates that the Government
“will put the necessary guidance regarding measures contained in the instrument on GOV.UK”
once Parliament has approved it. Is it therefore safe to assume that this instrument will be presented to the Chamber tomorrow for approval and that the guidance will appear on the website later tomorrow afternoon? Given the likelihood of confusion, I would like the Minister’s reassurance on this matter.
The Wine and Spirit Trade Association is concerned about the excise duty system and the need to make permanent the temporary easement mechanism. This is the single most important issue for the UK wine sector. The temporary easement taxes all wines in the 11.5% to 14.5% ABV range at a single rate of the mean, I suppose: 12.5%. This is due to end on 1 February 2025. If this is not made permanent, UK businesses will encounter increased bureaucracy and administrative burdens, and therefore increased costs, so will the Minister speak to his colleagues in the Treasury to make this easement permanent and thus support our flourishing wine industry?
This is a fairly straightforward SI which is linked to the CPTPP, and presumably ice wine will begin to appear on our supermarket shelves correctly labelled in the fairly near future, but I do not think I will be able to afford it.
Lord Moynihan (Con)
My Lords, it is very difficult to follow the noble Baroness after such an erudite speech, but I have a few quick questions to put to my noble friend. As I see it, this statutory instrument is being introduced only because we need to meet the requirements and obligations on the marketing of wine in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership. There is nothing intrinsically necessary in the labelling of ice wine that would otherwise have required legislation.
I therefore turn to why we are doing this and why it was originally agreed. I am sure the Minister has had many a glass of fine ice wine, not least from Canada or Germany. The definition of ice wine is that the grapes are left on the vine, as my noble friend said, until the temperature drops to a specific level, which I think is between minus 8 degrees and minus 14 degrees Celsius, which allows the grapes to freeze naturally. Then, when the pressing takes place, they are quickly harvested and pressed while still frozen, the frozen water content remains in the form of ice crystals and only the concentrated sugary juice is extracted. If, by chance, the frost passes quite quickly and the pickers go to the same vineyard and take the grapes from the same vine during the day, when it is marginally above freezing, can that still be called ice wine?
Secondly, and related to that, the alternative method of making ice wine from grapes follows after the harvest: the grapes are harvested and then artificially frozen to a temperature similar to that used in the natural freezing on the vine method. Frozen grapes are pressed much the same and the concentrated juice is collected, similar to the process with the grapes frozen on the vine. They do not need to go through the technical stages that my noble friend has outlined; it could be exactly the same process. As I understand it, there is therefore a distinction to be made between ice wine that is made from grapes frozen after harvest and grapes frozen on the vine, although I challenge the Minister to tell me the difference, if he were given a blind tasting, between the two.
So the Minister comes forward with an excellent SI that says we cannot have anything that is
“a term similar to a term mentioned”
as ice wine. I would be interested to know what a similar term to ice wine might be. We always want to get the legislation exact. I imagine that a lengthy court case might ensue as a result of asking: what is “a term similar to” ice wine? Could it be called “frosty wine”, for example? Would that be “a term similar to” ice wine? I know that the noble Baroness, Lady Hayman, has the opportunity to speak on behalf of the Opposition, but I give the very fine officials who are sitting behind the Minister the opportunity to answer those two questions. It would be very helpful to me and, I am sure, to the Committee to know those answers.
Baroness Hayman of Ullock (Lab)
I thank the noble Lord for introducing this statutory instrument. I will not go into the details of what it is about; he explained it very well, as has the noble Baroness, Lady Walmsley, but I have a few points and questions.
As we have heard, the SI is largely to give effect to the relevant part of the CPTPP because Canada is the major producer of ice wine. I have been to a number of vineyards in Canada that produce ice wine. In fact, I did splash out, buy some and bring it back. If you have not tried ice wine, it comes in lovely slim bottles and is very nice indeed. In response to the noble Lord, Lord Moynihan, my recollection—I could be wrong—from the tours of the vineyards is that it has to be harvested when it is frozen; you cannot defrost the grapes, then pick them. It is important that we are protecting what is a very distinctive product, so we clearly support this SI.
While we are on the issue of the CPTPP, are there going to be any other SIs coming through Defra regarding trade and the CPTPP? I do not know if the Minister knows the answer but it would be quite interesting to have a heads-up on that. We have had, as the noble Baroness said, other SIs on wine. There may not be any other way around this, and it is no criticism, but Defra seems to come up with a lot of small SIs. Does it have to be like that? Could we do them en bloc to be a bit more efficient?
I was interested that in the Minister’s introduction he talked about the fact that this product is only imported; we clearly do not make ice wine in this country. It would be interesting to know the impact of this SI. How much ice wine is imported into this country? I had never seen it until I went to Canada. What percentage would no longer be able to be marketed and what is the actual impact of this statutory instrument? It would be interesting to know if it has been a problem for the wine trade.
The Minister also mentioned the Welsh and Scottish instruments that are likely to come forward through their legislation. Other noble Lords also mentioned this and the noble Baroness, Lady Walmsley, asked about the timescales. I note that Defra’s response to the Secondary Legislation Scrutiny Committee’s concerns, in its report, explained that there are already rules in place which mean that this should not be a problem. Even so, we need to get all our legislative ducks in a row, so it would be interesting to know the likely timescales.
Finally, I support what the noble Baroness said about the Wine and Spirit Trade Association’s concerns regarding tax and excise duty. It has raised a really important point and I support her request to the Minister that this is discussed with the Treasury and that the department looks at this seriously.
Lord Harlech (Con)
My Lords, I am very grateful to all noble Lords who have contributed to this brief, but very illuminating, debate on ice wine and the further measures in this statutory instrument. There has been consensus on the importance of these changes. Although ice wine is not produced domestically, but imported, it is really important that consumers are able to identify products easily.
The change will assure consumers that only wine that is made from grapes naturally frozen on the vine is sold as ice wine. Taking up my noble friend’s point, and as other noble Lords have mentioned, the change is also necessary for compliance with the UK’s CPTPP agreement. What good timing that today’s SI debate is on the same day as that Bill’s Report. Similarly, introducing the most recent winemaking techniques—let us not forget the second part of the SI, because it is really important for what is a growing industry—will enable English wine producers to use the latest technological advancements and winemaking practices.
Lord Harlech (Con)
Now that is on the record.
I say again that we have a thriving domestic wine production industry, which is continuing to grow at speed. WineGB, which represents most domestic wine producers, reported that 2023 saw Great Britain’s largest ever grape harvest, which it is estimated will produce 20 million to 22 million bottles of British wine. There was overwhelming support for updating these oenological practices from both our domestic producers and international trading partners, all understanding the importance of having access to the latest methodologies.
Finally, on the reforms on wine not being all done in one SI, the department has been working at pace to drive forward wine reforms from retained EU law and implementing the reforms in three phases, the first of which came into force on 1 January this year to dovetail with the end of an easement relating to importer labelling. The second instalment, in this SI, is due to come in in July in time to ratify the CPTPP agreement and now we can focus on the final phase. I think the logic behind that is that it is better to keep things moving rather than doing things in one block, which could have caused uncertainty to producers and importers.
Lord Moynihan (Con)
Before my noble friend sits down, I would like to press him on why, under new paragraph 8(d) in Regulation 2, it is deemed necessary by the Government to write
“a term similar to a term mentioned in point (a), (b) or (c)”
when those three sub-paragraphs are
“(a)‘ice wine’; (b)‘icewine’; (c)‘ice-wine’”.
It would be helpful to the Committee to give an example of a term that is similar to ice wine that would be covered by this statutory instrument.
Lord Harlech (Con)
For the benefit of the Committee, it may be useful for me to go away and consider my noble friend’s question, so as not to detain the Committee any longer. I will of course go back and look at Hansard and if there is anything that I have not answered then I will write, circulate that to all noble Lords and place a copy in the Library. I hope that I have addressed the majority of issues raised and that noble Lords will approve this instrument.
House of Lords
Coram’s Charter for Children
(11 months ago)
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The Lord Bishop of Durham
To ask His Majesty’s Government what assessment they have made of Coram’s Charter for Children, and what steps they plan to take to implement its recommendations to create better chances for children.
The Parliamentary Under-Secretary of State, Department for Education (Baroness Barran) (Con)
My Lords, we welcome the publication of Coram’s Charter for Children and are grateful for its work in supporting children, young people and families. All children need love and stability to be happy and to grow up capable of fulfilling their potential. The Government are committed to prioritising the needs of children, ensuring that their best interests are at the centre of policy- and decision-making.
The Lord Bishop of Durham
I thank the Minister for her Answer. The charter outlines a social contract between society and children which seeks to ensure that they get a fair share, a secure future and an equal chance. It states clearly that, at the moment, life is not getting better for children and young people in our country. Will His Majesty’s Government ensure that children’s best interests are always preserved by having child impact assessments and finally appointing a Cabinet- level Minister for children?
Baroness Barran (Con)
The Government absolutely accept that Covid in particular had a marked effect on our children, but we already have a Cabinet-level Minister for children—the Secretary of State for Education, who represents the interests of children in Cabinet. We also have a child rights impact assessment that government departments can use.
Baroness Lister of Burtersett (Lab)
My Lords, this morning a coalition of leading health bodies, with the support of the Children’s Commissioner, launched a report in the River Room aimed at improving children’s nutritional health. Like the Coram charter, it calls for the extension of free school meals, starting with all primary school children, and auto-enrolment. Will the Government finally listen to and act on the growing calls for the extension of free school meals, which the evidence shows will improve children’s health and educational performance?
Baroness Barran (Con)
I remind the noble Baroness that this Government have extended school meal eligibility more than any other, including through universal infant free school meals and for families with no recourse to public funds. Our strategy has been to support families in a major way, with £104 billion of support between 2022 and 2025 and, rightly, giving parents discretion on its use.
Lord Laming (CB)
My Lords, the Minister well understands that in recent years there has been a steady run-down of family support services, at considerable cost to some children who would normally have been able to depend on this kind of help and support at a critical stage in their lives. Sadly, those children from the poorest homes who are affected in this way are also likely to be persistently absent from schools, thereby limiting their development. Will there be opportunities in future to increase family support services?
Baroness Barran (Con)
I would slightly reframe the noble Lord’s first assertion. There has been a redirection of resources to increasingly complex cases in child protection and a displacement of resources from some of the earlier help services. The House is aware of the Government’s commitment to rolling out family hubs and providing really comprehensive, targeted support to families who need it the most. I share the noble Lord’s deep concerns about attendance. All Ministers across the department have this as a primary focus.
Lord Storey (LD)
My Lords, the Coram Charter for Children makes for disturbing reading. Some 4.2 million children in this country are in poverty—4.2 million children in a wealthy country. This figure is rising. The Minister will agree that this has devastating consequences for children’s health, security and opportunities. Can the Minister tell the House what action the Government plan to take to stop the cuts in children’s services?
Baroness Barran (Con)
We understand that local authorities are under significant financial pressure. That is why we have committed to major reform in relation to children’s social care, focusing increasingly on earlier intervention. Over the last three spending reviews, local government has seen real increases in its core spending power, with a major cash injection of £5.1 billion last year, of which £3.1 billion was provided through a central government grant.
Lord Young of Cookham (Con)
My Lords, the Coram charter calls for the reform of childcare, enabling all children to have access to high-quality early years provision. I very much welcome the announcement last year of free provision for two year-olds from 1 April, with further extension later on. However, in the year that has just ended, there were 216 nursery closures in England, compared with 144 in the previous year. What steps are the Government taking to encourage early years providers to increase capacity to meet this new demand?
Baroness Barran (Con)
I thank my noble friend for his question. Of course, he is right about the number of closures, but overall, the workforce has increased by 4% in the last year. My noble friend asks about action now: we have announced an increase in the hourly rates paid to providers, to £5.88 for three to four year-olds, and up to £11.22 for the under twos. We are allowing parents to register their interest early in the new free childcare provision, allowing nurseries to expand. We have increased the flexibility for childminders to deliver their services outside the home.
Baroness Wilcox of Newport (Lab)
Improving children’s lives should centre on ensuring that we deliver high standards for all children in all schools. According to an IFS report released last month, schools serving more disadvantaged pupils have seen larger spending cuts since 2010. How do the Government justify this gap in pupil spending?
Baroness Barran (Con)
I do not fully recognise the figures that the noble Baroness refers to. As she knows, we have been adjusting school funding to try to move towards a national funding formula. We have also invested increasingly in the pupil premium to support precisely the children whom she and the Government are most concerned about.
Baroness Butler-Sloss (CB)
My Lords, looking at the other end of childhood—teenagers—will the Government do something better about youth clubs, which might have some effect on gangs?
Baroness Barran (Con)
There are multiple things that will have effects on gangs, but clearly the engagement of young people is very important, as the noble and learned Baroness suggests. That is why we made the national youth guarantee commitments in 2022.
Baroness Uddin (Non-Afl)
My Lords, I acknowledge the Minister’s personal commitment to support children’s services and children themselves, but that is not necessarily the outcome delivered by other Ministers and her government department, as has been stated across the House. Will the Minister look at the practice in Tower Hamlets, which has been providing not only educational support but free meals from age three to senior school years? Will she undertake at least to explore why one authority can make it while others cannot?
Baroness Barran (Con)
The department is of course happy not only to look at the ability to provide meals in the way that the noble Baroness set out but to see their impact. A core principle of this Government is to give as much autonomy as possible to schools. They know their children and how to use their budgets; we trust them and back their judgment.
Baroness Benjamin (LD)
My Lords, I declare an interest as a patron of Coram, the country’s first and longest-serving children’s charity. Our Charter for Children makes several important recommendations, from early years education to school leavers and mental health, which should not be ignored because of financial constraints, as they will benefit society in the long term. We need to show that every child across the nation is valued and that no child is left behind, because, as I always say, childhood lasts a lifetime. Will the Minister agree to meet me and representatives from Coram to discuss this important report?
Baroness Barran (Con)
I would be delighted to meet the noble Baroness and the team from Coram. I put on record our thanks to them for all the work that they do.
Imprisonment for Public Protection
(11 months ago)
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Lord Moylan
To ask His Majesty’s Government what plans they have to reply to the letter addressed to them on 17 August 2023 by the United Nations Special Rapporteur on Torture and other Cruel, Inhuman or Degrading Treatment or Punishment and others, concerning imprisonment for public protection.
The Parliamentary Under-Secretary of State, Ministry of Justice (Lord Bellamy) (Con)
My Lords, the Government are grateful for the UN special rapporteur’s interest in this important matter and have considered her letter carefully. A response was sent on 19 December 2023 and published on the Office of the United Nations High Commissioner for Human Rights website at www.ohchr.org. The IPP action plan aims to promote sentence progression for all those serving IPP sentences, and provisions in the Victims and Prisoners Bill will reduce the number subject to that sentence over time.
Lord Moylan (Con)
My Lords, I thank my noble and learned friend and apologise that my Question was tabled, quite by coincidence, on the day that the Government issued their response to the letter. Does he accept the evidence submitted to the Justice Select Committee in the other place, and referred to by the special rapporteur—that the mental health problems caused by the IPP sentence itself multiply the difficulties that the prisoners face in obtaining release, and that therefore the Government would be wholly justified in considering any legislation in treating them as a special case with particular needs and trying to assist them to obtain discharge of the sentence?
Lord Bellamy (Con)
My Lords, the Government accept that there are certain special mental health issues for a number of these prisoners. They are being tackled, as far as we can do so, within the existing system. The action plan to which I referred contains provisions in that regard, particularly on improving psychological services and providing better support for prisoners on licence to avoid later recall. I do not accept the second part of my noble friend’s question that it follows that we need special legislation to deal with this.
Baroness Chakrabarti (Lab)
My Lords, we must all be so grateful to the noble Lord, Lord Moylan, for his continued campaigning on this issue, and we are grateful to the Government for responding at such length to the rapporteur. If everything in the IPP garden is so rosy in relation to indeterminately detained people, some of whom would have got a sentence of only months for their actual crime, why did the Government abolish this sentence in the first place, and why did the noble Lord, Lord Clarke, as late as 2016 call the threshold that prisoners have to meet to secure their release both ridiculous and absurd?
Lord Bellamy (Con)
I do not assert that everything in the garden is rosy. This area is one of the acute—perhaps the most acute—dilemmas faced by the Ministry of Justice. Your Lordships will be aware that the subject of IPP prisoners is being addressed in Part 4 of the Victims and Prisoners Bill currently before Parliament, which we will shortly discuss in detail in Committee, and I am meeting noble Lords on Thursday to take that discussion further.
Lord Clarke of Nottingham (Con)
My Lords, this is not just a major problem in the system; it is a major disgrace to the British justice system that these thousands of people are being kept in this way. When I persuaded my then Cabinet colleagues to abolish the IPP system because it was working so badly, unfortunately I was unable to persuade them to change the application of the licensing system in the ordinary way to these prisoners. I am glad that the Government are now contemplating action. I look forward to the legislation, but it has taken years. Will they consider something drastic, such as that, when prisoners are released on licence, the licence period should be for a much shorter period than usual, because at the moment people are being returned for quite minor breaches of licence, to the disproportionate consequence of an indeterminate sentence that may keep them in prison for life? Why cannot they be released on licence for 12 months and thereafter be subject to the usual criminal law for the protection of the public? Will the Minister consider that, and every other suggestion flowing to him from the campaigners?
Lord Bellamy (Con)
My Lords, the House will be aware that the Victims and Prisoners Bill reduces the qualifying licence period from 10 years to three, with the presumption of termination at that point, and automatic termination two years thereafter if there is no recall in the meantime. A recent report by His Majesty’s Inspectorate of Probation found that in none of the cases examined was the recall inappropriate but that, in some cases, further additional support in the community might have avoided the need for recall. That has led to a number of recommendations, all of which the Government have accepted.
Lord Purvis of Tweed (LD)
My Lords, when I served on the Justice Committee in the Scottish Parliament, I recall that Scotland chose a different path from England and Wales when the sentences were introduced by the Labour Government in 2005, and it was right that they were abolished in 2012. The UN rapporteur’s figures make very sobering reading, stating that 97% of those still imprisoned are now two years beyond the tariff and 46% are 10 years beyond the tariff, with rehabilitation having been designed as an integral part of the sentencing. What are the obstacles for the Government in implementing the recommendations of the Justice Committee in the Commons, endorsed by the UN rapporteur, for resentencing and rehabilitation now being put forward? What are the obstacles to this happening, so we can finally put to bed what has been a very sorry exercise?
Lord Bellamy (Con)
My Lords, I think I have explained this matter several times before to your Lordships but, in brief, the situation is this. We have 1,200 prisoners who have never been released. Almost all of those have come several times before the Parole Board, which each time has decided that they are not safe to release. Any resentencing exercise would inevitably either aim at or result in possibly a thousand persons being released who are not safe to release. The cohort includes many violent and sexual offenders, who are particularly difficult to manage in the community. The Government feel that they cannot take that risk and should not raise expectations but manage the situation by preparing the remaining prisoners for safe release.
Lord Ponsonby of Shulbrede (Lab)
My Lords, when IPP sentences were in place, the offender received a minimum tariff. When the offender went to prison, an offender manager, who is a probation officer, wrote a sentence plan. That same probation officer would also review that plan. Can the Minister say with confidence that all the elements of the sentence plans which are currently in place can be completed, and in a reasonable time?
Lord Bellamy (Con)
My Lords, it is a very good question. A strengthened action plan—a strengthened sentence plan for each IPP prisoner—is an essential part of the wider IPP action plan. That is currently being worked on so that each IPP prisoner still in custody will have a personalised, updated and—we hope—effective sentence plan eventually leading to their release if that is at all possible. The newly established IPP progression board dealing with this matter now includes stakeholder representatives, who met in September and just before Christmas and will meet again in March, when we will report a full update on how the action plan is progressing.
Viscount Hailsham (Con)
My Lords, I reinforce the suggestion made by my noble friend Lord Clarke. Has the time not come to provide a presumption that all IPP prisoners who have served the tariff should be released unless there is robust evidence tendered to the Parole Board that they are unsafe to be released?
Lord Bellamy (Con)
My Lords, that is, in effect, the present position. The Government have no interest in holding these prisoners, especially given the pressure on the prison system generally. The Government’s fear, worry and concern is public protection, for the reasons I have given.
Lord Woodley (Lab)
My Lords, the special rapporteur, Dr Alice Edwards, whom I had the pleasure and privilege of meeting last month with the Justice Unions Parliamentary Group, stated forcefully that:
“The UK, as a society with a strong rule of law tradition, has measures in place to protect the community after individuals are released”.
Why then does the Minister think that these measures will be ineffective in the case of IPP prisoners?
Lord Bellamy (Con)
The Government replied in detail to the learned special rapporteur with a letter of over 13 pages on 23 December, to which I refer your Lordships. I look forward to further debate and discussion on this matter when we are dealing with the Victims and Prisoners Bill.
Water Pollution
(11 months ago)
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Baroness Boycott
To ask His Majesty’s Government, following the BBC “Panorama” documentary “The Water Pollution Cover-Up”, what assessment they have made of the ability of the Environment Agency to regulate and police water companies, and what steps they plan to take to stop sewage entering watercourses.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Douglas-Miller) (Con)
My Lords, I declare my interests as set out in the register. The Government are clear that the current volume of sewage being discharged into our waters is unacceptable. Our plan for water is addressing this and delivering more investment, stronger regulation and tougher enforcement to clean up our water and water environment. Where there is evidence of wrongdoing, the Environment Agency will not hesitate to act.
Baroness Boycott (CB)
My Lords, I welcome the Minister to the Dispatch Box and I too declare my interests.
The “Panorama” programme threw up a lot of issues. It has not had quite the effect of “Mr Bates vs The Post Office”—although I wish it had, because there is a lot of covering up going on at the moment in terms of sewerage works in this country. I would like to raise one point; others will be raised as the Question goes on.
Campaigners and journalists have been using freedom of information requests or environmental information requests to water companies, to explore and expose the illegal sewage discharges. But, increasingly, the companies are refusing to comply. In fact, nine out of 11 water and sewerage companies in England and Wales have said that the ongoing Ofwat and Environment Agency investigations mean that they do not have to hand over any data. This is completely contrary to what David Black, the CEO of Ofwat, told the Public Accounts Committee just four weeks ago. He said this was not a good enough reason. Do the Government not agree that this data should be provided for the sake of transparency, public health and the protection of the environment? Sewage in our rivers is something that everyone in this country cares about.
Lord Douglas-Miller (Con)
I thank the noble Baroness for her Question. The Government do not believe that there is any collusion. The role of the Environment Agency, as the environmental regulator for water companies, is to provide guidance to help water companies with their water resource management and to ensure that they are complying with the regulations. On FoI and environmental information regulations, water companies are only subject to the Environmental Information Regulations 2004 and not the Freedom of Information Act 2000. For the purposes of the environmental information regulations, water companies are their own legal entity, which means that it is for the organisation itself to tell you why it cannot provide all, or some of, the information requested.
Baroness McIntosh of Pickering (Con)
My Lords, I welcome my noble friend to this House and congratulate him on his new appointment. Possibly the best way of preventing sewage entering the watercourses is to ensure the end of the automatic right to connect major new developments with inadequate, inappropriate piping. Will he look into when the consultation will be brought forward to implement Schedule 3 to the Flood and Water Management Act 2010 to ensure that there will be no automatic connections in these circumstances and a better use of SUDS and natural flood defences?
Lord Douglas-Miller (Con)
I thank my noble friend for her kind words, which are greatly appreciated. We will be implementing Schedule 3 to the water management Act, as previously announced. I hope that that addresses my noble friend’s question.
Baroness Bakewell of Hardington Mandeville (LD)
My Lords, I welcome the Minister to his first outing at the Dispatch Box. It is clear from whistleblower evidence in the recent BBC “Panorama” investigation into water pollution that water companies can and do cheat the operator self-monitoring test by manipulating flows at failing sewage works. This ensures that there is no flow to sample when the official tester arrives. Will the Government concede that trusting companies that are financially motivated to cover up failing works to avoid penalties from Ofwat to carry out their own testing is not an effective regulatory system? Will they commit to putting robust independent regulation in place to ensure sewage works’ compliance?
Lord Douglas-Miller (Con)
Water companies, including United Utilities, have always been required to report pollution incidents and breaches of their permits to the Environment Agency. The agency also monitors and inspects water company sites independently. It has significantly driven up monitoring and transparency from water companies in recent years. Any reports of misreporting are a concern and, if there is evidence, the Environment Agency will always take action, including pursuing and prosecuting companies that are deliberately obstructive.
Baroness Hayman of Ullock (Lab)
My Lords, I too welcome the noble Lord to his place and say how much I look forward to working with him in the coming months.
In a Written Answer, the noble Lord noted that, following pollution from United Utilities in the Windermere area, the Environment Agency recognised that it should have done better and referred itself for independent review by its Scottish partner. The Answer also stated that learning had been shared with the EA to inform future responses. How many similar regulatory failures have taken place over the last three years, and how will the department ensure transparency over the outcomes?
Lord Douglas-Miller (Con)
Again, I thank the noble Baroness for her kind words. The Environment Agency has fully reviewed the evidence about this incident and concluded that the most likely cause of the Cunsey Beck issue at Lake Windermere was algal bloom. However, since the Environment Agency did not identify a definitive source of this serious problem, it asked the Scottish Environment Protection Agency to review its response. As a result of the review, the Environment Agency has made improvements to water quality monitoring in the area, including installing sensors that monitor river quality in real time. We have no plans to reopen the investigation in the absence of any substantial new evidence.
Lord Cromwell (CB)
My Lords, senior members of staff from water companies appearing in front of the regulatory committee told us that the monitoring that they have put in place is available freely, in real time, to the public. They now appear to be claiming that they are quasi sub judice because they are under investigation and are not prepared to provide that information. Is that something the Government will let them get away with?
Lord Douglas-Miller (Con)
The Government are very clear that we will be providing real-time information and that it will be available publicly. If any of the water companies feel that they will not be doing that, I can assure your Lordships that the Environment Agency will be chasing them.
Baroness Jones of Moulsecoomb (GP)
I welcome the new Minister, but on this issue he has stepped into a large bucket of doo-doo. I am just warning him; we are very unhappy here about this. I did not see the BBC “Panorama” programme that was referred to, but it showed that United Utilities is due to receive millions of pounds in performance payments from bill payers, as a result of it covering up and wrongly categorising pollution incidents. Will the Government research and look into this fraud? The allegations are that the Environment Agency is also complicit and other water companies could be doing exactly the same.
Lord Douglas-Miller (Con)
When I watched the “Panorama” programme, I too was left with the distinct impression that something fishy was going on. However, it is standard practice for the initial and final categorisations to be different. This is because the initial categorisation is based on the information provided in an initial report. An Environment Agency officer will then gather evidence about the incident from a variety of sources, including attendants at the most significant pollution events. They will then assess this information and give a final categorisation that is based on the evidence rather than on the initial estimate.
Lord Forsyth of Drumlean (Con)
My Lords, we made no progress on health and safety until we made company directors personally responsible. It is no good relying on a system of fines, because that just ends up putting up consumers’ bills. Now that my noble friend is in his new position, would he look at the prospect of holding boards to account for their performance in this regard? It would change the whole nature of their attitudes. On his point about something fishy going on, the point of this is that all the fish are dying.
Lord Douglas-Miller (Con)
As the former chair of the Atlantic Salmon Trust, I have some sympathy with my noble friend’s view. The Government have legislated to introduce unlimited penalties on water companies. I appreciate my noble friend’s point, but we have made a start in the right direction. A much wider range of issues can now be applied by the Environment Agency to hold water companies to account. As I stated at the beginning, the Government are acutely aware that the position is not satisfactory and are looking into the matter, with all seriousness.
National Health Service: Key Targets
(11 months ago)
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The Lord Bishop of St Albans
To ask His Majesty’s Government what plans they have in place to ensure the National Health Service meets its key targets.
The Parliamentary Under-Secretary of State, Department of Health and Social Care (Lord Markham) (Con)
The NHS has made progress against its targets, especially given the challenges of recovering from Covid-19, the changing demography and winter pressures. The Government recognise that there is still a way to go and are working non-stop to support the NHS to do better. I take this opportunity to thank all NHS staff for their hard work to improve performance this winter.
The Lord Bishop of St Albans
My Lords, I would like to join in thanking NHS staff, who are doing a fantastic job. There are some structural problems here. In particular, I am concerned about ambulance response times, which are causing a great deal of concern despite the Government having increased the category 2 call response times from 18 minutes to 30 minutes. Category 2 calls deal with such life-threatening events as strokes and heart attacks, so this is deeply worrying. What are His Majesty’s Government doing to reduce the response time? Will they consider returning to the 18-minute response time for category 2 calls?
Lord Markham (Con)
I agree with the basic point, as I am sure all noble Lords will, that ambulances are on the front line and are the most important service in all of this. That is why we have invested in 800 new ambulances, with over £200 million of funding. It is early days, but that is starting to take effect. Regarding the category 2 issue, we have managed to halve the time it takes since last year, but it is still too long and we absolutely need to make more progress in this area.
Lord Bird (CB)
Does the Minister agree with me that, if you really want to hit the targets for the NHS, you need to deal with the fact that 50% of people who present themselves at the NHS are suffering from food poverty? Why do we not concentrate on lifting the great weight on the NHS by doing serious work on getting rid of poverty?
Lord Markham (Con)
I agree with the noble Lord that prevention is key. About half the number of people who turn up at A&E do not need to go to A&E and can be seen in other settings. I completely agree that all the elements in terms of prevention and getting ahead of the problem are key, including where there are issues around food.
Baroness Browning (Con)
My Lords, following on from the question from the right reverend Prelate and his reference to stroke patients, given that there is a three-hour window for stroke patients during which, if certain treatments are given, the outcome is so much better, what have the Government done to ensure that, adding on the ambulance time to the time when the patient then arrives at hospital, more patients are being treated within that window? Is there a target specifically for stroke patients? It makes such a difference.
Lord Markham (Con)
My noble friend is absolutely correct, and strokes have been a major focus. I am glad to say that was one of the first areas where we rolled out AI everywhere, with the result that we were able to improve treatment times so much—and I will get the precise figures to my noble friend—that the recovery rate has increased by two-thirds as a result. It is absolutely right that this is an area of top focus.
Baroness Armstrong of Hill Top (Lab)
My Lords, the Government keep telling us—and I understand why and congratulate them on it—that the number of people employed as doctors and nurses has risen in recent years. Can the Minister explain why productivity over the same time has reduced by 4%?
Lord Markham (Con)
The noble Baroness is correct: staff numbers have gone up but, for a number of reasons that we are exploring, output has not gone up by the same amount. It is a key point, and I think all noble Lords agree that making sure we are getting value for money out of the service is important. We are engaged in a productivity study to discover the reasons right now.
Lord Allan of Hallam (LD)
My Lords, back in 2013, the Government set a target for the NHS to become paperless by 2018, which they later extended to 2020 when the target seemed too ambitious. This may come as something of a surprise to the millions of people who continue to have regular paper-based interactions with the NHS. Could the Minister tell the House when he now expects the target for the NHS becoming fully digital to be met? Would he agree that it is now even more important that we achieve it than when it was first set over a decade ago?
Lord Markham (Con)
I definitely agree that it is more important, and that is why I am pleased that we have made such progress. If we look at one area in terms of hospital records being available and doctors’ records to patients, that has gone up since the beginning of the year from about 1% of GPs to about 90% today. About 90% of all our hospital records are now digitised, compared to less than 3% in Germany. We have made massive progress, and it is key to all of the reform and to improving productivity across the NHS.
Lord Winston (Lab)
My Lords, the Minister well knows that we have raised the issue of primary care again and again in this Chamber. Would he be kind enough to tell the House how the Government feel they are doing with regard to the retention of very highly qualified general practitioners at the height of their career, who are currently leaving early? Up to about 50% are considering retirement before the retirement age. Will he comment on how he feels that is going?
Lord Markham (Con)
Staff retention, particularly of GPs, is vital. That is why we listened to the number one reason they were retiring, which was the feeling that their pensions were being adversely affected. We changed the rules in the last Budget to try to address that; it is early days, but I hear that that is starting to make progress. Primary care is the front line. That is why I am pleased that we have increased the number of appointments by more than 50 million, ahead of our manifesto target. But it absolutely needs to be a key focus.
Lord Kakkar (CB)
My Lords, I draw attention to my registered interests. The long-term—and, indeed, the short and medium-term—sustainability of the NHS is critically dependent upon active engagement in research and the adoption of innovation at scale and pace. Is the Minister content that His Majesty’s Government are doing enough to ensure that the NHS is resourced to support that research and innovation agenda?
Lord Markham (Con)
It is key, and I think we are all aware that a couple of years ago—this was a result of the report of the noble Lord, Lord O’Shaughnessy—we were not doing as well as we needed to be in the clinical trials area. I am glad to say that, since then, there has actually been a lot of progress towards it, so we are now hitting similar levels to comparative nations. Innovation is at the heart of everything we have done. We have some very good examples of that; I mentioned the stroke AI treatment earlier. We have just set a similar thing in terms of AI for looking at chest cancers, but it is absolutely something we need to make sure we continue to progress.
Baroness Merron (Lab)
My Lords, the King’s Fund has highlighted a delay to the release of additional funding to help NHS and social care services prepare for winter, which will of course only worsen the situation of missed targets and wait times for patients. Can the Minister tell the House what the reasons are for this delay and what steps are being taken to unblock the money to get it to where it is needed?
Lord Markham (Con)
One of the key learnings from last year, which goes back to the whole question about planning, was actually that if you put social care moneys in too late, you do not get nearly as effective spend. That is why we brought forward the £600 million discharge fund much earlier—actually, into the summer—so that local authorities and care providers could plan on that money. It is starting to make a difference. A key thing that noble Lords have heard me talk about is bed-blocking. Actually, we have seen a 10% reduction in bed-blocking since these measures have come into effect in the last few weeks. It is early days, but we are actually making progress.
Lord Jackson of Peterborough (Con)
My Lords, the number of over-85s is due to double over the next 30 years. Would my noble friend the Minister give some consideration to government funding for extra care facilities and at-home treatment, such as physiotherapy, in order that pressure be taken off acute district hospital beds in respect of older people?
Lord Markham (Con)
Funnily enough, I had this conversation in terms of productivity just today. The virtual wards—the 11,000 extra beds we have put in—are actually making a real impact on that, because of course it is much better that people can be treated in their own home, knowing they have the comfort of these virtual displays and treatment to look after them. We have 11,000 extra beds, with 72% utilisation, and, yes, it is really working.
Lord Hunt of Kings Heath (Lab)
My Lords, the Minister keeps talking about progress being made, but if he looks at, say, the four-hour A&E target, he knows that the latest figures show that the NHS reached only 69% in December. In 2010, his party inherited a performance of 98.3%. What does he think that says about his party’s stewardship of the NHS?
Lord Markham (Con)
I can talk about what we are doing now, which is showing real progress. But I have to say that the saying “People who live in glass houses shouldn’t throw stones” comes to mind, because, looking at those same targets, I notice that the Labour-run NHS in Wales never reached the four-hour A&E target; the last time it hit the 62-day cancer target was in August 2010, 14 years ago; and the last time it hit the hospital treatment target was in August 2010. I say politely that the noble Lord might want to get his own house in order first.
Rohingya Refugees
(11 months ago)
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The Lord Bishop of St Albans
To ask the Secretary of State for Foreign, Commonwealth and Development Affairs what steps he is taking to address the Rohingya Refugee crisis.
The Secretary of State for Foreign, Commonwealth and Development Affairs (Lord Cameron of Chipping Norton) (Con)
My Lords, since 2017, we have provided more than £373 million in funding for Rohingya refugees in Bangladesh and more than £30 million for Rohingya and other Muslim minorities in Myanmar. In December, at the Global Refugee Forum, we announced an additional £7 million for Rohingya refugees in Bangladesh and for the Myanmar humanitarian crisis. We also reiterated our commitment to finding a long-term solution to the crisis, including the safe, voluntary and dignified return of the Rohingya to Myanmar when conditions there allow.
The Lord Bishop of St Albans
My Lords, I am grateful for all that His Majesty’s Government have been doing to support the victims of this terrible humanitarian crisis. However, UK aid to the Rohingya refugees in Bangladesh has actually declined by about 82% since 2019-20. In the past year, Rohingya refugees in Bangladesh have suffered flooding, cyclones and fires, and cuts in food rations, simply because of reductions in aid. Just two weeks ago, 800 dwellings in Cox’s Bazar were destroyed by a fire. In the light of this terrible humanitarian crisis that we are observing, what other resources can His Majesty’s Government offer to try to address this dreadful problem?
Lord Cameron of Chipping Norton (Con)
The right reverend Prelate is entirely right about the scale of this crisis. There are 1 million Rohingya refugees in Bangladesh—think of the scale of that—with people often living in IDP camps and other temporary accommodation. I do not deny for a moment that the scale of funding has gone down. That is the same with many aid programmes, because of the move from 0.7% to 0.5%. Crucially, it is due also to the diversion of a lot of aid money to support refugees from Ukraine and Afghanistan, which I think was entirely the right thing to do. We will be spending another £20 million next year. To put it in context, Britain’s contribution has been almost twice as much as the EU’s over the past seven years. We are playing our role to make sure that this is not the forgotten crisis.
Baroness Nye (Lab)
My Lords, I declare an interest as a trustee of the Burma Campaign UK. All leaders of the Rohingya community associations have led calls for the British Government, as the penholder on Burma at the UN, to take action. If the British Government are not going to convene a meeting of the UN Security Council to address the failing of the Burmese military to take measures as instructed by the ICJ to prevent further ongoing genocide against the Rohingya, what action are the Government taking to ensure a level of protection for the Rohingya remaining in Myanmar?
Lord Cameron of Chipping Norton (Con)
The noble Baroness is entirely right: we are the penholder, and we take that duty very seriously. We have taken a range of action on this. Fundamentally, we are making sure that aid is going in—and I have just said what our contribution has been—and, secondly, that proper authorities are put in place to stop gender-based violence, collect evidence from the camps and make sure that people are held accountable. The third part of the strategy must be to put pressure on the Government to recognise that this country needs to have proper provision for all its ethnic minorities and parts, and to make sure that there is, effectively, a peace process and a more inclusive set of arrangements for the country, so that everyone can feel that they have a part in its future. Ultimately, no one wants the Rohingya to have to stay in Bangladesh; they should be able to go home.
Lord Purvis of Tweed (LD)
My Lords, the Foreign Secretary’s response to the right reverend Prelate indicated that funds have been diverted to the Ukraine resettlement scheme away from other schemes. I have asked in this Chamber, time and again, whether funds to support the Ukraine resettlement scheme in the UK have been diverted from other areas. Ministers have denied that, so can the Foreign Secretary clarify that point on the record? Secondly, the UK has been a refuge for many Rohingya who have sought asylum here under the Gateway Protection Programme. This was closed in 2020. On Friday, the Home Office’s Report on Safe and Legal Routes said that there are no safe and legal routes that the Rohingya would be able to apply for. Can the Minister assure me that, if any Rohingya is seeking refuge in the UK through a proper asylum application but is undocumented, they will not be detained and sent to Rwanda under his new scheme?
Lord Cameron of Chipping Norton (Con)
First, let me clarify the point I made. Obviously, the ODA budget qualifies to pay for refugees from Ukraine, Afghanistan and elsewhere. Effectively, what happened over previous years was not only that the budget moved from 0.7% to 0.5% but that some of it was taken up, quite rightly, by ODA spending on looking after people from Ukraine and Afghanistan. We can now see that the overseas aid budget being spent overseas is actually increasing. For instance, when it comes to Africa, next year the budget will be almost doubling, to well over £1 billion. On what we want to see with the Rohingya, clearly there is a huge refugee crisis. They are being looked after in Bangladesh. Ideally, when circumstances are right, they will be able to go home. In between now and then, I think we should learn the lesson of the Syrian refugee crisis, where we did a lot to help countries such as Lebanon and particularly Jordan to make sure that people were able to stay there, work there and build livelihoods there, and then, when it is possible, go home.
Lord Alton of Liverpool (CB)
My Lords, looking specifically at the point the right reverend Prelate raised about the plight of the refugees in Cox’s Bazaar in Bangladesh, will the Minister look again at what happened only last week, when 5,000 of those refugees were displaced from the shacks and tents in which they had been living as a result of a fire? The Minister invited us to look at the longer term. I reinforce what the noble Baroness, Lady Nye, said about the International Court of Justice, which has imposed interim provisional measures on the Burmese military, with the support of the British Government, which is extremely welcome. Will he raise at the Security Council the failure to implement that and will he have discussions with the National Unity Government about the long-term rights of the Rohingya, the Kachin, the Karen and the other ethnic and religious minorities? That is the fundamental issue: if someone is not an equal citizen in the new Burma that will emerge after the coup, nothing will change.
Lord Cameron of Chipping Norton (Con)
Fundamentally, the noble Lord is completely right about the interim measures which have been set out by the International Court of Justice. It is incumbent on the Government of Myanmar to make sure they are put in place and to abide by them. The noble Lord made the general point that what is required is an inclusive, federal state, where every ethnicity and every nationality can feel it has a part to play in the country and that it will benefit from the country’s resources. Obviously, we have this military Government, with whom we have very limited contact, but for the long-term future of Myanmar, that is the only answer.
Baroness Smith of Basildon (Lab)
My Lords, following on from the questions of the noble Lord, Lord Alton, I think the Minister will understand that the House does not find his answers completely satisfactory. He has said that it is the responsibility of the Government of Myanmar, and he knows that action is not being taken. The range of actions he has outlined seem to be around data collection and putting pressure on the Government. As the penholder in the Security Council on this issue, there is a special responsibility on the British Government. Is he able to say what discussions he has had with other members of the Security Council about putting pressure on the Government? Otherwise, nobody is going to be held to account for the crisis which has emerged.
Lord Cameron of Chipping Norton (Con)
The noble Baroness is absolutely right that we take our responsibilities very seriously. We have those discussions at permanent-member level of the UN Security Council. I will personally take this up with Barbara Woodward, our excellent permanent representative, to see what more can be done over the coming period. Fundamentally, we have set out what we think is necessary: the aid to go in, the accountability to be in place and the pressure for a long-term solution, and, at the same time, the Government obeying the interim measures set out by the ICJ.
Lord McConnell of Glenscorrodale (Lab)
My Lords, the failure of the international community to deal with the attempted genocide in Myanmar against the Rohingya is just one example of the failure of the responsibility to protect norms over the course of the past decade in so many places. What are the Government doing to reinvigorate the discussion on responsibility to protect at the United Nations and ensure that there is a refreshed approach to this in place that will help protect citizens who are under attack from their own Government, legitimate or otherwise?
Lord Cameron of Chipping Norton (Con)
The issue of the responsibility to protect is one we have taken forward and discuss with allies and partners. It is developing a doctrine, as it were. When it comes to this issue, we have a role; we are making a contribution and we are, I think, doing more than many countries of our size and scale. I think that there is a lot we should do to sort support ASEAN. It has set out its five principles for dealing with Myanmar, which we support, and has a co-ordinator from Laos who we want to work with. Ultimately, we should respect the fact that, in its region, ASEAN should take the lead on this issue and we can support where we can.
Baroness Bennett of Manor Castle (GP)
My Lords, on or about 28 December, it was widely reported that Indonesia had pushed back a boat containing a significant number of Rohingya refugees out of its territorial waters. I have not been able to find any report of what has happened since to the people on that boat. Would the Minister agree that that is absolutely unacceptable behaviour, out of line with international law? Have the Government made, or will they make, any representations on this to Indonesia? Do we not have to make sure that refugees are safe?
Lord Cameron of Chipping Norton (Con)
I am not aware of that report; I will certainly go away and look into it. What we would say is that Bangladesh should be praised for the role that it is playing in taking quite so many refugees. Obviously, there are huge pressures—there are worries about conditions in the camps and whether there is enough food—but, ultimately, Bangladesh is looking after a million people, and that is why we are supporting it to the extent that we are. Every country should take its responsibilities towards refugees very seriously.
Israel and Gaza
(11 months ago)
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Baroness Janke
To ask the Secretary of State for Foreign, Commonwealth and Development Affairs what steps he is taking to secure a lasting ceasefire arrangement between Israel and Gaza.
Lord Purvis of Tweed (LD)
My Lords, my noble friend Lady Janke is unwell. With her permission, and on her behalf, I beg leave to ask the Question standing in her name on the Order Paper.
The Secretary of State for Foreign, Commonwealth and Development Affairs (Lord Cameron of Chipping Norton) (Con)
My Lords, we support a ceasefire, but this must be a sustainable ceasefire that will last and prevent another generation living under the constant threat of war. That must mean that Hamas is no longer in power in Gaza, able to threaten Israel with rocket attacks and other forms of terrorism. Ahead of a permanent ceasefire, we want to see immediate and sustained humanitarian pauses to allow hostages to leave and more aid to enter Gaza, helping to create the conditions for a durable peace. As I said at the weekend, we would like to see such a pause start right now.
Lord Purvis of Tweed (LD)
My Lords, I thank the Foreign Secretary for his reply, and I agree with most of it. However, these Benches have for a number of weeks called for an immediate bilateral ceasefire, beyond a truce, which would allow hostages to be returned, bombing to stop and, of course, vital lifesaving aid to be secured. Why have the Government failed so far to persuade the Israeli Government to allow much greater access for the humanitarian aid that is needed? There are 1.9 million displaced people, many of whom are now facing famine. We now know that, when it comes to civilian casualties, this is the most deadly conflict in the 21st century. The UK will need to increase its support of humanitarian assistance, but it cut that from £107 million to £12 million between 2019 and 2023. I support the increase in aid but, surely, there will need to be an increase of the cap of 0.5% if we are to do our bit and ensure that aid is increased.
Lord Cameron of Chipping Norton (Con)
First, I would say to the noble Lord that we have trebled the amount of aid that we are putting into Gaza. I very much take on board what he says about the pressure we need to put on not just the Israeli Government but other Governments in the region to get more aid in. Right now, as we speak, nine out of 10 people in Gaza are living on less than one meal a day. It is that serious. That is why I have had repeated conversations with the Israelis and set out a whole series of bottlenecks that need to be relieved. We need Kerem Shalom open all the time. We need the Nitzana checkpoint open all the time. I would like to see the port of Ashdod opened in Israel so that aid can get into the country through maritime routes and more swiftly into Gaza.
Crucially, we will not see more aid get to the people who need it unless the United Nations inside Gaza has the vehicles, the people and the fuel to get it around. Those permissions need to be given. I have had these conversations most recently this morning with the new UN aid co-ordinator, who I am confident will do an excellent job. We will keep up the pressure for this, because, as I have said, an immediate pause to help get that aid in and to help get hostages out is essential.
Lord Owen (Ind SD)
Will the Foreign Secretary consider very seriously creating a UN protection force for humanitarian relief? That was done successfully in the winter of 1992 in a very difficult situation, with no ceasefire, in Bosnia and Herzegovina. I recommend that approach. Although a ceasefire is essential, it is not in the immediate future very likely, but the humanitarian crisis is getting worse every day. They cannot get relief in without some form of protection from UN forces.
Lord Cameron of Chipping Norton (Con)
I take what the noble Lord says, as a former Foreign Secretary, extremely seriously. What would make a difference is if Israel recognised its responsibilities for making sure that food, medicine and supplies have to be delivered to people in Gaza, and if it recognised that you need the UN staff who have the visas, the equipment and the fuel to help get it around. I will certainly take away the suggestion that the noble Lord makes, but the calculation here is quite simple. Before the conflict, some 500 trucks were going into Gaza every day. I check the figures every single day; we are up to about 150 trucks at the moment. That is not enough. The longer it goes on, the greater the risk of people going hungry and the greater the risk of disease and this humanitarian crisis getting worse. A pause would help, because there is no doubt that it would be easier to get food and other forms of aid in. It would also be very good to make some progress on the hostages, families of whom I met this morning.
Baroness Smith of Basildon (Lab)
My Lords, the Foreign Secretary makes an alarming point: that within Gaza nine out of 10 Palestinians are not even getting a single meal every day. The need for a sustained ceasefire is absolutely clear as a first step towards getting humanitarian aid in. The Government confirmed last week that currently there are no plans for RAF aid flights or deliveries by the Royal Navy. Can he say why that is? Surely that would be a good way of getting aid in and trying to get around some of the problems that we have at the moment.
Lord Cameron of Chipping Norton (Con)
We are looking at every single way of getting aid in. Of course, there are maritime options, and we had a ship leaving Cyprus and taking aid to Port Said in Egypt. The so-called over-the-beach option of trying to land aid in Gaza is extremely difficult for reasons of operational security and other forms of security. On dropping aid by air, the French and Jordanians did so recently, but it was less aid than you would get into one truck. The truth is that the best way to get aid into Gaza is through trucks. As I said, 500 are needed, 150 are happening, and if you opened up Kerem Shalom seven days a week, if you had the Nitzana checkpoint open 24/7 and if you had the people inside Gaza, there would be plenty of aid. There is no shortage of aid and no shortage of countries prepared to make the financial commitment. In the end, trucks are faster, and it is trucks that we need.
Baroness Hodgson of Abinger (Con)
My Lords, women and children are always disproportionately affected by conflict. The UK considers itself a global leader on the women, peace and security agenda and holds the pen for this at the UN Security Council. Why are we not hearing from women’s groups? After all, they were integral in bringing peace in both Northern Ireland and Liberia.
Lord Cameron of Chipping Norton (Con)
It is very important that we hear from everybody. One of the things that I do with the responsibilities of the aid and development portfolio that is now squarely within the Foreign Office is to make sure that we listen to all the NGOs, all the experts and all the people who can make a difference when it comes to getting aid in and trying to relieve this desperate humanitarian situation.
Lord Grocott (Lab)
When the Foreign Secretary said
“I am worried that Israel has taken action that might be in breach of international law”,
did he have in mind the principle of proportionality in armed conflict and whether it is a proportionate self-defence by Israel to have been responsible so far for some 24,000 Palestinian deaths, including 10,000 children?
Lord Cameron of Chipping Norton (Con)
What I meant when I said that was simply that I worry about these things. It is my job to worry. The Foreign Office has a job, which is to look at the legal advice and work out whether Israel is committed to, and capable of complying with, international humanitarian law, and then, based on that judgment, we have to take a series of actions, including looking at things like export licences. We always urge Israel to obey international humanitarian law, and it is important that we do so.
Lord Robathan (Con)
Is it not the case that there would be an immediate ceasefire tomorrow if Hamas were to release the hostages and lay down its weapons, and if the criminals who did atrocities on 7 October were to go and join their leaders in luxury hotels in the Gulf?
Lord Cameron of Chipping Norton (Con)
My noble friend makes a good point, which is that Hamas could end this tomorrow by saying that it was going to lay down its weapons or leave. Everyone is aware that we want a sustainable ceasefire. That means Hamas not in power and not able to launch rockets and terror, and we have said we want to see an immediate pause so we can get aid in and hostages out. However, in many ways, the very best outcome would be to see whether we could convert that immediate pause for aid and hostages into a sustainable ceasefire without further hostilities. But for that to happen, a series of other things would have to happen: there would have to be immediate negotiations to release all the hostages, the Hamas leadership would have to leave Gaza, and we would have to be clear that there was no more danger of rocket and terror attacks on Israel. We would have to put together something based on the Palestinian Authority, backed by other Palestinians, going back into Gaza. In many ways, that would be the best outcome, but if we call now for an immediate ceasefire with no further fighting when Hamas is still in power, still launching rockets and still capable of launching terror attacks, not only would we not have a sustainable ceasefire and peace but we would have no hope of the thing that I think many in this House would like to see, which is a two-state solution.
UN Sustainable Development Goals
(11 months ago)
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Lord Collins of Highbury
To ask the Secretary of State for Foreign, Commonwealth and Development Affairs what steps he is taking to promote the implementation of the UN sustainable development goals.
The Secretary of State for Foreign, Commonwealth and Development Affairs (Lord Cameron of Chipping Norton) (Con)
My Lords, the UK was instrumental in developing the sustainable development goals. Following the global recommitment to the SDGs at the United Nations General Assembly last autumn, we recognise the opportunity to reinvigorate a sense of collective purpose and partnership to deliver those goals. The international development White Paper sets out a re-energised agenda for the UK, working with partners, to accelerate progress on the SDGs by 2030. We will champion the SDGs throughout the key summits and meetings this year, and I will be making a speech on the SDGs in Davos tomorrow.
Lord Collins of Highbury (Lab)
I very much welcome that last comment. Of course, one barrier to progress is debt. The average low-income country now spends 2.3 times more on servicing debt than on social assistance. At the Commons Foreign Affairs Committee, the Minister stressed the importance of cross-Whitehall working to address priority areas, and debt is one of those areas.
One of the mechanisms that the UN adopted for monitoring progress on the SDGs is voluntary national reviews. We had our last one—our only one—in 2019. Spain is due to publish its third, Argentina its fourth, but what are we doing? Can the Minister explain why we have not followed that example and used the voluntary national reviews?
Lord Cameron of Chipping Norton (Con)
I very much agree with the noble Lord on the important position regarding debt and what needs to be done to help countries to relieve their debt. I do not necessarily think the answer is always to cancel debt, because in many cases that affects a country’s credit rating, but we support things such as climate resilient debt clauses and the flexibility they give.
On voluntary national reviews, we had one in 2019, as the noble Lord knows, but we have not made a decision about a follow-up. I say to him: look, it is not really Britain that is the problem in meeting the SDGs. What has happened here is that, because of Covid and Putin’s illegal invasion of Ukraine, African countries have had a triple whammy. They have had the whammy of Covid, the whammy of higher fuel prices and the whammy of higher food prices. That has caused an increase in poverty and set the SDGs off track. We have to energise the world—the voluntary sector and, crucially, the private sector—to invest in the future of the SDGs and get us back on track.
Lord Foulkes of Cumnock (Lab Co-op)
My Lords, instead of going on with slogans such as “Stop the boats” and gimmicks such as deportation to Rwanda, is not the best way to help to reduce illegal migration to see increased assistance to these countries to make it possible for the people who have to migrate, who are forced to leave their countries, to live there in peace and prosperity?
Lord Cameron of Chipping Norton (Con)
I certainly half agree with the noble Lord: the investment that we can put into the countries from which the migrants are coming is essential. We have to ensure that countries in north and sub-Saharan Africa are building a future for their own people and providing jobs; otherwise, those people will be on the move. The figures are outstanding: the population of Europe in 1950 was twice that of Africa, but by the end of this century the population of Africa will be four times that of Europe. So making sure that those countries develop is crucial but, at the same time, when you have problems of widespread illegal immigration, it is important to stop the boats.
Lord Hannay of Chiswick (CB)
My Lords, will the Foreign Secretary not take another look at the issue of debt forgiveness that he spoke rather critically of just now? In previous iterations of this saga, we have recognised in the end that debt forgiveness was necessary for some of the poorest countries. Could he not look at that again, as well as whether we could link it with the commitment by a country that was forgiven its debt to do more on climate change?
Lord Cameron of Chipping Norton (Con)
I respect the noble Lord and what he says. We have been leaders on this through the Paris Club and other mechanisms; in many cases it has been the right thing to do to write down a country’s debt. With respect to climate change, these climate resilient debt clauses can make a great difference in helping these countries. Fundamentally, if we want to achieve the SDGs, we need to motivate global finance, and one of the ways that we can do that is through the multilateral development banks because if they expand their balance sheets there is probably an extra £400 billion that they can invest to help these countries with their growth.
Lord Bruce of Bennachie (LD)
My Lords, the Foreign Secretary has said he thinks that the merger of DfID and the Foreign Office, and the cuts in aid, were justified; that was not what he said at the time. How much does he regret that his successors have trashed his proud legacy and, more to the point, how assured can he be that the funding for Africa, which is still being cut even if an increase has been promised, will not be diverted to the Home Office, as has happened in the last two years?
Lord Cameron of Chipping Norton (Con)
That is not exactly what I said. I am very proud that we reached 0.7%. I had some disagreements with this Government before I joined but politics is a team enterprise; when you decide to join a Government, you accept Cabinet collective responsibility and you accept you are going to work with that team and the policies they have. I am proud that, with 0.5% and a growing economy, we are seeing more money going to overseas development. Now that the refugee crisis is abating—I mentioned Africa—we will see, in our budgets, an increase from £600 million to over £1.2 billion, and we are committed, when the fiscal rules allow, to get back to the 0.7% that we historically achieved.
Lord Boateng (Lab)
My Lords, the biggest threat to the SDGs in Africa is conflict and internal instability. In the Sahel, this has increased ever since the disastrous Libyan incursion that the Foreign Secretary will remember very well. What steps does he personally intend to take to enhance security and democracy in sub-Saharan Africa, and will that include aid to civil society organisations?
Lord Cameron of Chipping Norton (Con)
The noble Lord is quite right that if you look at the SDGs and poverty more generally, half of the poorest people in the world are now in fragile states. If we cannot help to fix fragile and conflict-affected states, we will not meet the SDGs. If you look across the Sahel, there have been a number of coups and wars and a lot of instability, so I do not think there is a single answer to this, but one of the issues, when we look at aid and development and how we help these countries, is how making sure that they have adequate security is essential. Often in this House, or in the other place, we say that defence is the first duty of a Government, but when it comes to aid, we set up a whole series of different things that we think countries ought to achieve. We must help them with their fundamental and basic security, and that is something we are committed to doing.
Lord Cameron of Dillington (CB)
Some 60% of the population of sub-Saharan Africa are smallholder farmers, and most of them are women. Food from domestic resources is crucial for reaching many of these SDG goals: poverty; hunger; health; management of water; even education, because these lady farmers put nearly every penny they make from their food production into educating their children. Will the noble Lord please undertake—and I ask as one Lord Cameron to another—to boost the currently small team in his department that is involved in agriculture to enable them to help these lady farmers to feed their families and their nations and resolve many of these sustainable development goals?
Lord Cameron of Chipping Norton (Con)
I will certainly take away what the noble Lord said and look at it carefully. In history, it is true that a green revolution of productivity in agriculture has almost always been necessary to see more of an industrial revolution and an increase in prosperity. But the noble Lord made a good point about small farmers—as we should keep it in the family, I had better go and have a careful look at it.
Baroness Armstrong of Hill Top (Lab)
My Lords, the sustainable development goals included volunteering this time. As Prime Minister, the noble Lord really supported volunteering and introduced the International Citizen Service, which was run by VSO in this country incredibly successfully, so that the African Union then took it up as a major way of engaging the millions of young people in Africa whom he talked about. But a generation of young people in this country, and in the countries that organisations such as VSO work in, has missed out. Can he assure me that volunteering will now play a central part in the Government’s strategy to re-energise the achievement of the sustainable development goals and to do something to enable young people, here, in Africa and around the developing world, to get the skills and leadership that they need?
Lord Cameron of Chipping Norton (Con)
One of the great strengths of the SDGs was that they were much more comprehensive than the millennium development goals that they replaced. In fact, I helped to chair the panel that set them up, and we were determined that we would involve the private sector, bring together economic growth and climate, have much more to say about gender, and, as the noble Baroness rightly said, make sure that things such as volunteering were included. I am glad she mentioned the International Citizen Service, which I was proud to establish as Prime Minister. My International Development Secretary was Andrew Mitchell; the noble Baroness will notice that he and I are now back in the same department, and we hope to make some progress on this issue.
Rules-based International Order
(11 months ago)
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Baroness Chakrabarti
To ask the Secretary of State for Foreign, Commonwealth and Development Affairs what steps he is taking to champion a rules-based international order.
The Secretary of State for Foreign, Commonwealth and Development Affairs (Lord Cameron of Chipping Norton) (Con)
My Lords, an open and stable international order is in our interest. We use it to deliver on issues of domestic and global importance, such as the Bletchley AI safety declaration. We invest in it, as the fifth-largest UN budget contributor. We support reform of it to ensure that it benefits everyone, and we hold to account those who undermine it, including through steadfast support to Ukraine, sanctions against Russia and ensuring maritime security in the Red Sea. In a dangerous and uncertain world, this stable international order is more essential than ever.
Baroness Chakrabarti (Lab)
I am grateful to the Foreign Secretary for the clarity of that Answer on the importance and scale of his task. I wonder whether that task was helped or hindered by two developments yesterday. The first was fresh advice from the UN High Commissioner for Refugees that the Rwanda scheme, now updated by the Rwanda treaty and the safety of Rwanda Bill, is still contrary to international law. The second development was comments by the Prime Minister on GB News that the Court of Human Rights is a “foreign” court and that he is prepared to defy it.
Lord Cameron of Chipping Norton (Con)
We do not believe that the Rwanda scheme is contrary to international law. I would characterise it by saying that things like the refugee convention were written for another age, when there was not mass international travel or the ubiquity of mobile phones. We are saying that, yes, this is out-of-the-box thinking and it is quite unorthodox, but you have a choice, frankly: when you have people arriving from a perfectly safe country into another safe country, you have to deal with that trade. That requires some fresh thinking. It is not possible to put people straight back in a boat and take them back to France, which is why the Rwanda scheme is being introduced. It is within the law and it is novel, but I believe it can work.
Lord Howell of Guildford (Con)
My Lords, as many feel that the whole international rule of law is collapsing before our eyes and as my noble friend has rightly remarked that this is a very dangerous and fragile international situation, does he agree that it will be coped with only by new international organisations and institutions or by brushing up the present set of them? Can he share his thoughts on where the priorities in that process should be? Should we concentrate on repairing the United Nations, which is in a mess, or invent new structures in that respect, as the noble Lord, Lord Owen, just suggested? Might the Commonwealth, by far the largest network of voluntary, like-minded nations in the world, have an important role in building up a future structure to deal with all these crises?
Lord Cameron of Chipping Norton (Con)
My Lords, that is an excellent question but difficult to answer. Fundamentally, we are in almost all these networks—we are in the G7, the G20 and the OECD, we are the fifth-biggest contributor to the UN and a permanent member of the Security Council—so we should be quite thoughtful and selective about where we think institutions can be strengthened. A good example of that is NATO; it is undoubtedly stronger than it was two, four, six, eight or 10 years ago, which is a very good thing. Some organisations you could spend the rest of your political life trying to reform but struggle to make progress—I might put the United Nations in that category. We should use what we have and make it work as well as we can, but we should also look at new institutions when there is a specific problem, such as Gavi, the Vaccine Alliance, which does amazing work that we should get behind. I am a practical conservative; I do not have an all-encompassing, global set of rules that we must abide by. Let us take what we have and, where we can, improve it.
Lord Collins of Highbury (Lab)
My Lords, the noble Lord has been engaged in the enlargement of the UN Security Council. Can he update us on the progress of that, including the system of penholders? Also, when nations fail in their most important task of protecting the safety and security of their people, civil society is often the first to come to their defence. Guterres and the UN have encouraged the involvement of civil society in the Security Council. What does the noble Lord think about that and will he do more to support the Secretary-General in engaging with civil society?
Lord Cameron of Chipping Norton (Con)
I certainly support engaging with civil society at the United Nations Security Council, as we have been doing. I will look very carefully at what Secretary-General Guterres has said. We support United Nations Security Council reform—India should be a permanent member and we need to look at the representation of Africa—but, candidly, in trying to make progress in these reforms, this will be a very difficult one on which to get unanimity. In this difficult, dangerous and disputatious world, the most important thing is to ask what we can do to strengthen our networks, NATO and our defence, security and intelligence forces to keep us safe at home and to ask through which institutions we can get things done. That is my priority. Although I support United Nations Security Council reform, it might be some time coming.
Baroness Smith of Newnham (LD)
My Lords, I think the Foreign Secretary said to the noble Baroness, Lady Chakrabarti, that Rwanda is a “perfectly safe country”. If that is the case, why do we still grant asylum to people coming from Rwanda? He suggested that international refugee law is rather out of date, implying that if a law comes from a different age then it can be ignored. Is that really the inference that he wanted to leave with the House?
Lord Cameron of Chipping Norton (Con)
No. I am saying that in the modern world, where you have the ubiquity of mobile phones and mass cheap travel, countries have to make a decision about how to deal with illegal migration. I will be very frank with the noble Baroness: I do not think that we can tolerate a situation where there is very wide-scale, visible illegal migration taking place in small boats. It is not only desperately dangerous and unsafe for the people who do it—another four people lost their lives in the freezing cold waters of the English Channel the other night—but it completely undermines faith in our immigration system. As I said, all these people are coming from a totally safe country, France.
You have a choice in politics. You can say—and I do not want to get too political, because I know that is not the way of this House—that you are going to work on dealing with the criminal gangs and work on more agreements with France. I agree with all those things. However, ultimately, if you do not say to the people who come in the boats that they cannot stay here because they came illegally, you will not stop this trade and you are not going to save those lives. This Government have made a choice: that is what we are going to do. Yes, it is complicated; yes, it is expensive; yes, in the case of Rwanda, is it out-of-the-box thinking. However, it is the right thing to do because, if you do not do it, you will carry on with the problem.
It is not just Britain that has this issue. Some 6 million people have crossed the southern border in the United States. Country after country in Europe is looking at novel thinking for how to deal with illegal immigration. We have to do that, because otherwise we will have a system which will have no public confidence.
Lord Austin of Dudley (Non-Afl)
My Lords, one of the best ways that the UK could stand up for a rules-based international order would be to do all we can to secure the release of Vladimir Kara-Murza, the British citizen incarcerated on trumped-up charges by Putin. Will the Foreign Secretary agree to an urgent meeting with me, his wife Evgenia Kara-Murza and those campaigning for his release?
Lord Cameron of Chipping Norton (Con)
I think I am right in saying that a meeting has already been arranged and is in process. I do not know whether the noble Lord will be joining us, but it would be a pleasure to get together after all these years.
Viscount Hailsham (Con)
My Lords, in furtherance of a rules-based society, I suggest to my noble friend that it would be desirable if he could promote a coalition of willing states to reinforce the efforts of the United States and the United Kingdom to ensure safe navigation in international seas. We need a coalition of willing nations to participate.
Lord Cameron of Chipping Norton (Con)
Obviously no one likes a coalition more than I do.
Lord Cameron of Chipping Norton (Con)
We do have a coalition of not only those countries taking part in Operation Prosperity Guardian in the Red Sea, but all those countries supporting it. Again, even when it came to the military action, there was a coalition of countries—including the Dutch, Canada and Australia—backing us militarily, and a wider coalition of countries supported the action taken. Wherever possible, we should build a coalition, but sometimes it is necessary to act quickly, and I think the Prime Minister made the right decision.
Lord Alton of Liverpool (CB)
My Lords, how does a rules-based international order sit with the destruction of the Sino-British treaty, an international treaty, which has led to the dismantling of democracy and of “one country, two systems” in Hong Kong? How does it sit alongside the show trials of Jimmy Lai, a British citizen, and the naming in those proceedings of four other British citizens, including our former consul-general Andrew Heyn? Surely that in turn is a breach of the Geneva convention. Why have the Government not yet done anything to use Magnitsky sanctions against any of those who have been responsible for these things?
Lord Cameron of Chipping Norton (Con)
One of the reasons for supporting a rules-based order is that it enables you to call out other countries when they fail to live up to it. That is exactly what we have done in the case that the noble Lord refers to. That is why we have said that the national security law needs to be taken out, and that is why we have said that Jimmy Lai needs to be released. We have been very clear about that and how we do not think that it is in line with the arrangements that were put in place when the Hong Kong agreement was reached.
Animal Welfare (Livestock Exports) Bill
Tuesday 16th January 2024
(11 months ago)
Lords ChamberRead Full debate Animal Welfare (Livestock Exports) Act 2024 View all Animal Welfare (Livestock Exports) Act 2024 Debates Read Hansard Text Amendment Paper: Committee of the whole House Amendments as at 15 January 2024 - (15 Jan 2024)
Employment Tribunals and Employment Appeal Tribunal (Composition of Tribunal) Regulations 2023
(11 months ago)
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Lord Bellamy
That the draft Regulations laid before the House on 14 November 2023 be approved. Considered in Grand Committee on 10 January.
Data Reporting Services Regulations 2023
Lord Roborough
That the draft Regulations laid before the House on 27 November and 4 December be approved. Considered in Grand Committee on 10 January.
Relevant document: 7th Report from the Secondary Legislation Scrutiny Committee
Lord Roborough (Con)
My Lords, on behalf of my noble friend Lady Vere of Norbiton, I beg to move the Motions standing in her name on the Order Paper en bloc.
Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill [HL]
Tuesday 16th January 2024
(11 months ago)
Lords ChamberRead Full debate Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Act 2024 View all Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Act 2024 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 4-R-I Marshalled list for Report - (12 Jan 2024)
17:42 - Division on Amendment 5 - Ayes: 102 / Noes: 212 - Amendment 5 disagreed.
Lord Lansley
(b) funded by an international organisation of which the United Kingdom is a member to a lesser extent, and”
Lord Lansley (Con)
My Lords, this group and the next group of amendments follow debates that took place in Committee, and I am very grateful for the Minister’s response then and for his subsequent letters that have further amplified the discussion about this. I apologise for delaying the House—not for very long, I hope—simply, in the case of both amendments, not to make any point of principle contradicting what is in the Bill, but to try to ensure that the meaning of the Bill and its intentions are as clear as we can possibly make them.
The first two amendments, Amendments 1 and 2, work together to rewrite that bit of the Bill to state that the exempt contracts would be, in this instance, where they are “wholly or mainly funded” by an international organisation, or
“funded by an international organisation of which the United Kingdom is a member to a lesser extent”—
so that funding is to a lesser extent—and is “required to be” under a procedure adopted by that international organisation. Article 15 of the CPTPP has a requirement that we want to transpose into our legislation. It states that a procurement that is not covered by individual countries’ own procurement rules would be one that is
“funded by an international organisation or foreign or international grants, loans or other assistance to which procurement procedures or conditions of the international organisation or donor apply”.
What we are looking to do in this instance is to reproduce that, so that the exemption for contracts under our Procurement Act matches what is in the CPTPP.
The government view was that the CPTPP just says “funded”, while our general approach is to try to clarify, to a greater extent, that it should say “wholly or mainly funded”—namely, more than 50%—which is consistent with what we do in relation to the rule on the general procurement agreement. However, the point that I have now reached, which I put to my noble friend via these amendments, is that it is not necessarily the case that an organisation such as the World Bank has to be a majority funder in order for its funding—and that of others with which its funding is associated, which might be other providers of grants or loans, or the recipient country in one form or another—to be required to be conducted under its procedures. That being the case, should we reflect the CPTPP rules by saying that either a procurement is “wholly or mainly funded” by the international organisation, or, if it is funded to a lesser extent, that it is required to be subject to its procedures, and that that would give rise to an exemption under our procurement rules?
That is the point of the amendment. I am sure my noble friend will appreciate the rather fine distinctions, but I wonder whether he might agree that, at the very least, we want to be absolutely clear that, if a procurement has to be conducted under the rules of an international organisation, such as the World Bank, it should be exempt from our Procurement Act requirements. I beg to move Amendment 1.
The Minister of State, Department for Business and Trade (Lord Johnson of Lainston) (Con)
My Lords, I begin by declaring my interests, which are very clearly listed on the Lords’ register. I have interests in limited companies and companies that are active in CPTPP countries, but I do not believe there is any conflict.
Baroness Kennedy of The Shaws (Lab)
My Lords, we cannot really hear the Minister; could he raise his voice?
Lord Johnson of Lainston (Con)
Yes, my apologies. Before I begin, I would like to declare my interests, which are very clearly listed on the Lords’ register. I have interests in limited companies and other companies active in CPTPP countries, but I do not believe there is any conflict of interest in this process today.
I will also say how excited I am about being back here today to cover Report stage of the CPTPP Bill. This incredible collective of millions of people, representing trillions of pounds-worth of trade, coming together will give huge benefit to us, and I am very excited about the opportunity for this great nation to add our trading muscle to what I think will be a phenomenal collective.
Importantly, I give a great deal of thanks to noble Members of this House who have contributed so much to the painstaking work which goes into crafting a Bill of this type and ensuring we come to the right conclusions in the right way. I know there have been a large number of you, many of whom are present today, but I particularly note the noble Lords, Lord McNicol and Lord Purvis, from the Opposition Benches, for their extremely collaborative and constructive input into the debates. My noble friend Lord Lansley, who we have just heard from, brings a wealth of experience, particularly on procurement. I am very grateful for his input. My noble friends Lady McIntosh, Lord Holmes, Lady Lawlor and a number of others, including the noble Baroness, Lady Hayter, and the noble Lord, Lord Kerr, have engaged with me. We still have one more stage after Report and I will be delighted to continue engaging with any Members of this House, or indeed any groups that noble Lords think it would be useful for me to engage with.
I will also set the scene briefly for the debates we are going to have on many of these respective issues. My noble friend Lady McIntosh is in her usual place, and I apologise, because I have been trying to reach her over the last few hours, but we have not had a chance to have a discussion. I reference this point because what happens today in terms of how we trade, or how we manage our own standards in this country, does not change tomorrow. I think it is important to summarise at the beginning of this debate that acceding to CPTPP in no way derogates our standards or our ability to control our standards and, indeed, our destiny. We have been very careful to ensure that the processes are indeed very separate.
I know that we will have these debates later, but it is worth re-emphasising this important point, which I think is sometimes lost in the excitement of CPTPP—the argument that somehow our standards, import requirements and so on change, when they do not. All food and drink products imported into the UK will still have to meet the respective food safety and biosecurity standards for the UK. We are not having to change any of our food standards as a result of joining CPTPP, and it is important to emphasise on these well-discussed points that hormone-treated beef and chlorine-washed chicken are banned in the UK and will not be allowed to enter the UK market.
I am very grateful to various agencies such as the Food Standards Agency, the Trade and Agriculture Commission, the International Agreements Committee and other groups that have been extremely focused on ensuring that these facts are properly reported. I am grateful to them for the backing that they have given me in ensuring that those statements are clear.
It is also worth pointing out that CPTPP preserves the right to regulate to protect human, animal and plant life and health. The TAC report says that the CPTPP does not require the UK to change its levels of statutory protection in relation to animal or plant life or health, animal welfare or environmental protection. I am well aware that noble Lords wish to cover these issues later in this debate, but it is important to set that scene.
There is one area I would like to draw on now, in advance of these discussions, regarding palm oil. I reassure the House that liberalising palm oil tariffs with Malaysia does not undermine the UK’s environmental credentials. We remain committed to supporting the sustainable production of palm oil. In 2021, 72% of UK palm oil imports were certified as sustainable, up from 16% in 2010.
Lord Lansley (Con)
I am most grateful to my noble friend. He explained very well why the Government want to clarify this in this way. I hope he is right, and it is wholly consistent with CPTPP, although it is not precisely the same wording—it adds additional clarification. My noble friend made typically generous remarks about those of us who have been, as he says, painstakingly working our way through the technicalities of this Bill, and I am grateful for that. Some of our noble friends and colleagues on the International Agreements Committee are elsewhere with their committee this afternoon, but I know that they will read his remarks and want to thank him very much for that.
I take my noble friend’s point that, to the extent that procurements are brought within the scope of our procurement rules, they are in line with the general procurement agreement and best practice. In so far as we can, we want to bring as many of the recipient countries of international organisations’ funding within general procurement agreement rules, so that they are following best practice. We should aim to have more countries following those rules and to operate in ways consistent with how we do things than to leave them outside.
On that basis, I understand and accept my noble friend’s points and beg leave to withdraw the amendment.
Lord Lansley
Lord Lansley (Con)
I hope that I will be equally quick on this amendment, as there are points of more substance and principle to be debated later.
We discussed Amendment 3 in Committee. Essentially, it relates to a set of circumstances in which trademarks and GIs—geographical indications—may come into conflict and the circumstances in which the Secretary of State can make a decision that there would be confusion between the two. The point is that the GIs should be compared to existing trademarks and registered trademarks; to circumstances where, on the date which the GI is submitted, there are applications for the registration of trademarks; and, as the legislation refers to, where trademarks are “established by use”.
My problem is that nowhere in trademark legislation do the words “established by use” appear. My noble friend’s letter to me of 10 January said that “established by use” refers to unregistered trademarks. We appear to be putting into statute the concept that where a trademark has been used, it can be established but not registered, and I am not sure that that is helpful. What is more helpful would be to indicate that the Secretary of State should have a discretion to look at a GI that may come into conflict with an unregistered trademark—there are such things—and where confusion would result. My noble friend says that they may just use a trademark once, and the fact that it had been used once at some point in the past may lead to this confusion. As the legislation is drafted, the Secretary of State would actually have the discretion to judge these matters and to say whether confusion would arise. If a trademark has not been used prior to that date in any substantial way, I think the Secretary of State could ignore it and say that the GI has a meaning that people will readily understand.
I have a problem with the term “established by use” and think that “in use prior to that date” is more straight- forward and has the meaning we are looking for; “established by use” runs a risk of establishing that, in law, trademarks can be established by use. That is not something that the trademarks legislation currently admits of. I am not an expert in intellectual property matters, but I have talked to one or two who are, as we do in this place. I think there may be a problem with this, but I stand to be corrected by my noble friend. For the moment, I beg to move Amendment 3.
Lord Hope of Craighead (CB)
My Lords, I cannot claim any expertise in trademarks or their registration, but I think there is force in the point made by the noble Lord, Lord Lansley. The expression “established by use” is slightly vague, whereas the words that the noble Lord would substitute—of it being actively “in use prior to that date”—make the point rather better. I support the amendment, for what it is worth, in the interests of clarity.
Lord McNicol of West Kilbride (Lab)
My Lords, the noble Lord, Lord Lansley, is right: the Trade Marks Act 1994 at no point uses the words “established by use”. However, the Act makes specific provision for registered trademarks, whereas those established by use—as the noble Lord said—would presumably be unregistered and, therefore, subject to common law through the concept of passing off. It would be interesting to hear the Minister’s comments on passing off and whether that covers it.
I want to pick up the main point of this amendment and, specifically, geographical indications. I think this may be the only time on Report that we will be able to get some words into Hansard on that. The noble Lord, Lord Lansley, picked up the technical part, but there is a wider set of issues on geographical indications on which I am interested to hear the Minister’s response.
When this agreement was announced in October 2020, the then Trade Secretary Liz Truss MP promised that 77 specialist UK food and drink products would be guaranteed protected geographical indication status, along with the seven that were carried over from the previous EU-Japan trade deal. The former DIT Minister said that the protections would be in place by May 2021 for all 77 new products, which included many iconic British brands, such as Scottish beef, Cornish pasties and Welsh lamb—to name but a few. The DIT also boasted that, thanks to Liz Truss’s agreement, the UK would benefit from fast-track processes for securing brand protection that would not have been possible under the EU-Japan deal. It said:
“The EU must negotiate each new GI individually on a case-by-case basis”.
The EU has added 84 extra products to its protected list since October 2020, including a number in the last few months, but I understand that Kemi Badenoch’s department has not yet secured brand protection for a single one of the 77 products originally promised. The number of EU GIs with Japan now stands at 299, which offers them protection, while the UK is still stuck with only the seven protected products inherited from the EU-Japan deal. Given this, how can UK producers of geographically indicated products be confident in the measures contained within the CPTPP?
Baroness Butler-Sloss (CB)
Perhaps I might add something before the Minister speaks. Having listened with interest to my noble and learned friend Lord Hope, and with my limited intellectual property knowledge, I am concerned about the use of the words “established by use”. As far as I know, they do not appear elsewhere and are certainly not part of existing legislation. To bring them into this legislation, almost by a side wind, would be somewhat unfortunate.
Lord Johnson of Lainston (Con)
As always, I thank my noble friend Lord Lansley and all contributors to the debate on this amendment. It is very relevant, in my view; however, I am comfortable keeping the words “established by use” in the Bill as printed, rather than using
“in use prior to that date”.
My reason is simple and was pointed out by my noble friend: a single use of a name could be construed as giving the same protections as a trademark which, through an effective accumulation of good will and the establishment of its use, has been protected under these laws. We are quite comfortable with the wording.
I am aware that there is no reference to the concept of “established by use” in the Trade Marks Act 1994— I am surprised that there is no lawyer in this House jumping up to support me at this crucial moment, just when I need one. They seem not to be in their usual places but they would say, were they here, that this is an extremely well-established part of trademarks law. As I understand it—I am comfortable to be corrected, but my officials assure me of this—elsewhere, in the amended legislation relating to unregistered trademarks, is the common-law tort of passing off, which relates to good will. I am also reassured that in GI legislation—for example, Article 14(2) of the assimilated regulation 1151/ 2012—the concept of “established by use” is written and codified.
From our point of view, it is important to ensure that we protect our trademarks and that we use geographical indicators where appropriate. I will come on to the point raised by the noble Lord, Lord McNicol, in a moment. Having spent a great deal of time working on this, I ask my noble friend to withdraw his amendment because I do not believe that by changing the phraseology we will give the greater protection that we want to our trademark-using organisations, businesses and people, and allow the system to function effectively. I am very convinced of that. We have a line in our next amendment that will allow us to discuss geographical indicators in slightly more detail, so I will cover the points raised by the noble Lord, Lord McNicol, at that point if he is content with that.
Lord Lansley (Con)
I am grateful to all who took part in this very short debate, and in particular to the noble and learned Lord, Lord Hope, and the noble and learned Baroness, Lady Butler-Sloss, for their contributions on the legal aspects.
Unfortunately, I have not had an opportunity to look at the reference my noble friend refers to elsewhere in the GI regulations. That was not an aspect of this to which he referred in his letter of 10 January. He referred to the concept of the tort of passing off as a justification for it. My problem was that putting something in a statute that is justified by reference to a common-law definition seems problematic, since one might be assumed to be trying to create a statutory definition. I did not think the definition existed; I may be proved wrong about that.
I am just hopeful that it is not the case that one use of an unregistered trademark before the date of a GI means that it is established by use. It must be defined somewhere else and I hope that that is what my noble friend is suggesting—that “established by use” in relation to a GI is somewhere codified and defined. That would establish a degree of protection, and I hope we do not subsequently encounter circumstances in which the inclusion of this language causes a problem in relation to those who are responsible for distinguishing between registered and unregistered trademarks.
I remember, and my noble friend will recall from the debate we had in Committee, that we set out to secure GI recognition in the UK-Japan economic partnership agreement. We need to get on with it. Equally, in the UK-Australia deal we set out to secure protection for our GI indications. But it was made clear in the Australia deal that we would do so only in so far as, and to the extent that, the European Union secured protection for its GIs, and I am not sure that we have made the progress there that we should have.
These are very important aspects of our potential trade advantage and, if we are going to maximise our trade benefits, we need our geographical indications to be protected and we need to be using them in export markets. I should declare my registered interest as co-chair of the UK-Japan 21st Century Group. I will be in Japan at the beginning of next month and I will make it my business to ask about what progress we, and they, are making in protecting our GIs in Japan. For the moment, we thank my noble friend—
Lord Purvis of Tweed (LD)
Before the noble Lord sits down, I am unaccustomed to supporting the Minister in these areas, as he and the House are aware, but, having glanced at legislation.gov.uk, regulation 2019/787, regarding the relationship between trademarks and geographical indicators, does indeed have the definition of “established by use”. I am not a lawyer, as I very willingly admit, but if the Government have had the good sense to transpose what we had in the EU legislation into domestic legislation, then that might satisfy the noble Lord.
Lord Lansley (Con)
I am grateful to the noble Lord, and it may indeed satisfy me as long as we do not abolish it any time soon. With all those helpful comments from noble Lords, I beg leave to withdraw Amendment 3.
Amendment 3 withdrawn.
Amendment 4
Lord Johnson of Lainston
“1B. In a case where the protected designation of origin or protected geographical indication has been the subject of an application for approval of an amendment to the product specification under Article 53 which resulted in a change to the protected name, the reference in paragraph 1A to the application for registration under Article 49 is to be read as a reference to the application for approval of the amendment to the name under Article 49 as applied by Article 53(2) (or, in a case where there has been more than one such application, the latest of those).”Member's explanatory statement
This amendment clarifies the test for cancelling a protected designation of origin or geographical indication where the registered name has been the subject of a name change application; a cancellation will be possible only if the grounds for cancellation existed at the date of the name change application (rather than the date of the original application for registration).
Lord Johnson of Lainston (Con)
My Lords, Amendment 4 is a minor technical amendment that the Government have introduced. I will read out my brief to be clear, because it is quite technical. The Bill as currently drafted may lead to a degree of uncertainty for decision-makers over the date that should be used when assessing whether the new grounds for cancellation of a geographical indication apply in a case where the GI has successfully undergone a name change. Under the current drafting, it could be argued that, in such a case, the date on which the original application to register the GI was submitted under Article 49 of Regulation 1151/2012 should be the date used to carry out the assessment and not the date when the name change application under Article 53 was submitted. This amendment addresses that uncertainty by making it clear that the assessment should be carried out based on the factual position relating to the date when the name change application was submitted, rather than the date the original Article 49 application was submitted.
I will translate that a little. The provision is effectively looking at the date on which the name change is submitted, rather than the original name. If I have a GI—“Johnson’s Water” or whatever it may be—registered in 1990 and then change the name to “Lord Johnson’s Water” this year, then the reference would be made to the point at which the name change application was made, rather than the status at the time of the original GI. It is a clarification which we think is important, and I trust my officials’ view on that.
I will just answer briefly the very helpful comments raised about Japan and geographical indicators. I would be extremely grateful to my noble friend Lord Lansley for making representation to the authorities in Japan to speed the process up. We are fully committed to ensuring that our GIs are protected in Japan; it is part of the agreements we have undertaken, but these things take time to effect. We are doing everything we can to be sure that those indicators are protected. Anything that he can do to speed that process up will be gratefully received by this Government. I beg to move.
Lord Leong (Lab)
My Lords, as we have heard, this government Amendment 4 is really a relatively minor and technical amendment, so there is not much to add, except for some questions we hope the Minister will respond to. How often do the Government expect this test to be utilised, and are there any potential ramifications they will come across? What happens if the name change application is not successful—is that a possibility? Finally, if a name changes from a geographical indication into a generic term, does this amendment apply?
Lord Johnson of Lainston (Con)
I thank the noble Lord for that point. I am very comfortable having a more detailed discussion about GIs in principle. It is worth noting that many countries, including those in the CPTPP, do not have necessary GI processes. Sadly, too few do, so there is a great push on behalf of this Government to ensure that we advance the cause of geographical indicators to ensure that our rights are protected. It is correct that it is possible for a name change to be rejected; it is a process that takes time, as with any intellectual property issue. It is a detailed and thorough process to ensure that we can be comfortable that names, trademarks, GIs and so on are properly protected, and the research has been done. It can be six months or it can be a year, which is why we have built in this provision to ensure that it is the point of application rather than the point of approval that the data is referring to. That makes sense.
There have not been any cancellations of GIs undertaken by this Government, or indeed recently. I will check that, but I hope I am accurate; if I am not, I will certainly correct myself in the Library. The question from the noble Lord is about whether this is something that happens regularly, and is a constant and ongoing issue. Maybe there have been one or two exceptional examples but as far as I am aware, it is a relatively straightforward process; it seems quite uncontentious so far.
These regulations simplify the processes in respect of how we operate with the CPTPP. Often, we look at the activities that will take place in this country, which is right. How to protect our own GIs is what we are working on domestically. Really, this allows us to export the whole principle of geographical indicators—the wonderful concepts of Scottish salmon and Scottish whisky, to name just two enormously important and well-branded products. It allows us to work with our partner countries in the CPTPP to ensure that those brands and concepts are well protected, because a GI does not give us any strength unless it is domestically registered and the domestic legal system respects these principles. I therefore hope very much that the House will support me on this technical amendment and on the principle that it projects.
Lord Alton of Liverpool
“Report: accession of the People’s Republic of China to the CPTPP(1) Before any decision is made by the Government of the United Kingdom on the accession of the People’s Republic of China to the CPTPP under Chapter 30 of the CPTPP, the Secretary of State must publish a report assessing the impact of China’s accession on the United Kingdom.(2) Both Houses of Parliament must be presented with a motion for resolution on the report under subsection (1).”Member's explanatory statement
This amendment seeks to allow for parliamentary scrutiny of the prospective accession of the People’s Republic of China to the CPTPP - the Government of which has already applied to join, and whose application is to be considered. Scrutiny of future accessions is not provided for in the bill or through the CRaG process.
Lord Alton of Liverpool (CB)
My Lords, I am grateful to your Lordships’ House for giving me the opportunity to address this issue again. It is an amendment which I laid before Committee, and it was very ably moved there by the noble Lord, Lord Leong. I was grateful to him for doing that. I also thank the Minister, who was good enough to have a meeting with me only last week to discuss the terms of the amendment to see if any agreement could be reached. I should also express my thanks to the co-sponsors of what is an all-party amendment: the noble Baroness, Lady Kennedy of The Shaws, the noble Lord, Lord Purvis, and the noble Lord, Lord Blencathra, who is on his way from Cumbria but hopes to be here before the conclusion of the debate; we shall see. I also heard from the noble Baroness, Lady Jones, that this is something that the Greens support, and I see that a letter has been sent to Conservative colleagues today by the former leader of the Conservative Party Sir Iain Duncan Smith MP. He says that the amendment remedies the problem in a proportionate way that goes with the grain of government policy.
What is the problem that we are trying to solve? That is what I want to address. When the noble Lords, Lord McNicol and Lord Purvis, made excellent interventions from their respective Front Benches in Committee, they underlined the need for parliamentary scrutiny. That is what this amendment is all about. It is straightforward and non-binding on the Government, but it enables both Houses of Parliament to debate, vote and give their advice on an issue of considerable importance involving geopolitics, strategic dependency and national security.
For the purpose of transparency, I should refer to my non-financial interest in the register that I have been sanctioned by the People’s Republic of China, along with six other parliamentarians, including the current Security Minister, a former leader of the Conservative Party, and a current Minister from the department of the noble Lord, Lord Johnson, Nusrat Ghani MP. Of course, in your Lordships’ House, my colleague the noble Baroness, Lady Kennedy of The Shaws, has been sanctioned too. In my case, it was for speaking out against the Uighur genocide, the use of Uighur slave labour in Xinjiang, the destruction of Hong Kong’s democracy and the incarceration of more than 1,700 pro-democracy supporters, including the British citizen and businessman Jimmy Lai, a case that I raised earlier today with the Foreign Secretary. Therefore, I guess that I am not agnostic about the PRC and its mendacity.
As I indicated in a recent debate, I believe that our parliamentary Intelligence and Security Committee, reflecting the work of this House’s own International Relations and Defence Select Committee and the House of Commons Foreign Affairs Select Committee, was right to warn us of the dangers posed by the People’s Republic of China. In truth, the Government have still not resolved the problem of what the noble Lord, Lord Patten of Barnes, calls “cakeism”. He used that word in evidence to our International Relations and Defence Select Committee. What he meant by that was that we wanted to deepen our trade links—something that the noble Lord, Lord Johnson, pursues with great alacrity—but simultaneously we want to identify the threats and challenges to our security, including infiltration and subversion of institutions, even CCP spies operating across Parliament. This amendment would provide parliamentarians with the opportunity to probe whether the Government have acted with due regard to questions of national security and our long-term interests.
Baroness Kennedy of The Shaws (Lab)
My Lords, I support this amendment. I should declare a number of matters. One is that I am the director of the International Bar Association’s Human Rights Institute, and we have taken quite strong positions with regard to China’s abuses of human rights, particularly in recent years with regard to the persecution of the Uighurs and in relation to its behaviour and conduct with regard to Hong Kong and its breach of the Sino- British agreement.
I declare also that I am the chancellor of Sheffield Hallam University, which is proud to have among its professors Laura Murphy, an American who lives here in Britain with her husband and who is one of the most well-recognised experts in the field of forced labour.
Professor Murphy’s work on China has been extraordinary. Others in this House who have read it will be aware of the depth of her work and the reliability of her research, which has informed the State Department in the United States and has been used by government departments here. Her work shows that forced labour is part of the problem of contemporary China. It is certainly part of the problem of the abuses of the Uighur people.
I support this amendment. Most of us in this House would agree that we have to avoid any dependence on authoritarian states. It is for that reason that some of us have deep concerns about not having the opportunity in future to scrutinise the ways in which China might be embraced in some of the multilateral—plurilateral—institutions, which it is very assiduously seeking in our contemporary world. The China of today is not the China that joined the World Trade Organization 20 years ago, as described by my friend, the noble Lord, Lord Alton.
China is displaying, under the presidency of President Xi, that it is seeking regional hegemony. The belt and road programme has shown the extent to which it has created an indebtedness among many nations which is then reflected in other things. We saw it happening recently in the motion that was placed before the United Nations General Assembly in relation to the crime of aggression committed by Russia with regard to Ukraine. We saw it in the vote that was taken on that issue, with all those countries that are indebted to China and that are in its purview because of the ways in which it has been involved in the building of infrastructure and so on across Africa and other places. I am afraid it is an example of that long arm affecting issues that should concern all of us, such as an illegal war. The extent to which China is seeking to enlarge its hegemony should be a source of concern to all of us.
I am not a hawk with regard to China. I believe that we must continue to have dialogue and that it is fruitful to have dialogue. However, we should be very cautious about being drawn into something which will give opportunities to a nation that is not respectful of that rules-based order which was being discussed earlier today. It is being very inventive and innovative in the breaking of the rules that we thought should apply to all nations.
The arguments have been very well made by the noble Lord, Lord Alton—the importance of us having the opportunity to debate, scrutinise and raise issues that are not known to everyone, particularly with regard to the abuses of human rights. We like to imagine that engagement can lead to a raising of standards. At the moment that does not seem to be happening with regard to China. We have been seeing it, as was just referred to, in what is happening with the introduction of national security laws and so on that are being used against trading people such as Jimmy Lai, a great entrepreneur himself. So I endorse and adopt the arguments that have been made by the noble Lord, Lord Alton.
I just mention that in applying to join the CPTPP there can be exceptions allowed and one of them is national security. When I see national security being referred to as a potential reason why there might be some opt-outs for some of the commitments one would expect in any agreement, it worries me because of what we have seen China doing with its national security law that it has been using in Hong Kong.
I adopt the arguments that have been made. I press the House to agree that this is a very sensible amendment. It is not asking very much; it is asking us to do what we normally do, which is to scrutinise and question some of the things that might be being done by our Government.
Lord Hamilton of Epsom (Con)
My Lords, I received the email from the noble Lord, Lord Alton, trying to persuade me to support the amendment, and I must say that I am very reluctant to do so. The fact is that all trade agreements are a compromise. That is one reason why there is no veto in Parliament over a trade agreement—you would start to unpick the whole thing if Parliament objected to some aspect of a trade agreement —and there is no reason why we should want to change that now.
The other point is that the real prize for the CPTPP would be not the membership of China but the membership of the United States. It is clear that neither country wants to join at the moment, for particular reasons, but the agreement is going to last a very long time, and there may well come a moment when things change in China and the threat of China joining might well force the United States to join in order to keep China out. So we do not want to tie any Government’s hands on this in any way. We have to bear in mind that if the United States was to join the CPTPP, it really would become a massive trading bloc, and that prize would be well worth achieving.
Lord Lansley (Con)
My Lords, while I have enormous sympathy with the purpose of the amendment moved by the noble Lord, Lord Alton, he has explained perfectly clearly that the CPTPP members would all have to agree not just that China would join the CPTPP but that a negotiation with China would be entered into. The benchmarks against which that would be measured are laid out in an annexe to the CPTPP, and there is a great distance between where China is today and the benchmarks that would have to be met, so I see no immediate process for that.
The terms of the amendment, in creating a different legal process for the accession of one potential applicant economy as compared with any other applicant economy, represent an unwelcome position for us to have taken. It might be construed as unwelcome in other countries as well; it seems to me that it would set a bad precedent. The question that would be put to the Government is what position we should take as to whether a commission should be established to look at an aspirant economy, and the United Kingdom Government could take a position on that. While I join my noble friend in resisting the amendment, it would be helpful if he could say that there was nothing to stop the Government from potentially laying a Statement under CRaG for that purpose and asking the relevant committees to comment on it.
That would not enable Parliament to veto it—indeed, a veto would be unwelcome at that stage because it would be a decision whether or not to enter into a negotiation—but, as in other cases, the Government would be well advised to take full account of what Parliament might say in relation to any such notification and any such report by the International Agreements Committee here and the Business and Trade Committee in the other place. I wonder whether my noble friend might suggest that, if there were such a potential decision to be made by the UK Government, they could go through that process and it would be perfectly reasonable for them to do so.
Baroness Lawlor (Con)
My Lords, I am sympathetic to the amendment moved by the noble Lord, Lord Alton. I approach it from a somewhat different angle, on which he himself touched, which is the use of economic tools to gain hegemony geographically. We are talking about the wide area of influence that China already commands, not just in the Indo-Pacific. Already 20% of Chinese goods are destined for CPTPP countries; 50% of them are intermediate products. Of those countries, Malaysia, Vietnam and Mexico have the highest level of imports from China. When we join, that figure will go up because 13% of our imports come from China.
Whatever the outcome of the decision on this amendment, I urge the Government to consider very carefully some arrangement so that there can be collaboration between Parliament and government on the very important business aim of the UK, which is to prevent economic tools being used against UK interests, including those to which the noble Lord, Lord Alton, referred.
Lord Purvis of Tweed (LD)
My Lords, I have added my name to the amendment in the name of the noble Lord, Lord Alton, and did so very happily. I will comment on a couple of points that have been raised in this short debate and then, without adding to what I said in Committee, highlight the reason why strategic debates about the UK’s trading relationship with China are important.
One of the reasons I was attracted to my party was that the Liberals were part of the founding movement for free trade. At that time, we traded with China and we will trade with China in the future, but this is a debate not about trading with China but about the UK’s resilience and our strategic trade interests. The noble Lord, Lord Hamilton, made the point that Parliament’s role is not to assess trade negotiations or assess whether China would meet the benchmarks for accession to the CPTPP. His argument was rejected by his noble friend Lord Lansley, who came to the conclusion that China is a long way from meeting the benchmarks. I cannot second-guess what the other members of the CPTPP will say, and nor can we hold them to account, but we can hold our Government to account for the assessments that they make. There will have to be a public process because the difference—I put it to the noble Lord, Lord Hamilton—is that China’s accession is less of a negotiation; it is an accession process, which is different from a bilateral FTA process. On that issue of substance, it is quite different.
The noble Lord, Lord Hamilton, also said that it would be wrong if we sought, by approving this amendment, somehow to provide a veto or to bind Ministers’ hands. It would not be a veto: there is nothing in the amendment that would allow it to be a veto. I refer also to the comments of his noble friend Lord Lansley, who said that there would be nothing to stop the Government bringing a report anyway. Opposing something that the noble Lord, Lord Lansley, suggested was in the Government’s interest to do is a bit of a stretch, but the Government have the ability to present a report, and this amendment says that they should. We have argued consistently for this in the Trade Act and on other trade negotiations.
The reason why China is particularly important, as was alluded to by the noble Baroness, Lady Lawlor, is not just the scale of the UK’s trade with China but how resilient we are in relation to it. It is absolutely right that the noble Lord, Lord Alton, raised the issue of Taiwan. I have just written to the President-elect, whose DPP is a sister party of ours on these Benches, to congratulate him on a remarkable victory. UK trade interests with Taiwan and shipping coming from that area are of critical importance. It is not just that British consumers enjoy the benefit of buying Chinese products, but we have the biggest trade deficit in goods with one country in our nation’s history. The trade deficit of £40 billion with China comes at a time when the whole narrative of UK government policy is that we would do trade with other countries in Asia, not China, that would offset any theoretical reduction with trade with Europe. We know that is not the case; it has proven harder to replicate the trading arrangements that we had with our European partners with those in Asia. We also know that the growth in trade in Asian economies, as the noble Baroness, Lady Lawlor, said, is because of their trading relationship with China. We cannot have it both ways.
If there is anything that suggests why we should have more of a strategic debate about how resilient the UK is when we have the biggest trade deficit of any nation on earth with China—I remind the House that Germany has a trade surplus in the export of goods to China—it is last Friday’s actions by the Royal Air Force. The shipping of goods from China, which we depend on for our consumers, comes through the very area where we have deployed military assets in the last few days, which we discussed last night in this House. It is in our geopolitical and strategic trading interests that Parliament debates our relationship with China. Given the potential for interventions in our trading and shipping through the Red Sea and through Suez, interruptions to our trading through the Taiwan Strait or other interruptions—because China can, without notice, change its national security profile and how it seeks to impact on a country such as the UK—we are uniquely vulnerable to another nation state’s decisions about its strategic position on exporting to the UK.
On the one hand, one might argue that the more that China being more of a part of the rules-based WTO mechanisms is in our interest—that is right, but it is a separate debate. Here, we are discussing how our Parliament will hold any Government to account for decisions that they may take on an assessment of whether it is in our strategic interests to support China acceding to the CPTPP. Asking for a report and for it to be debated in Parliament is the very least that could be asked for, and I hope that will not cause any big division across the House. We should all support this, and the Government should perhaps accept the need for a report and a debate in Parliament. That is what this amendment seeks to do.
Lord Rooker (Lab)
The noble Lord, Lord Alton, is to be commended for this amendment. I will briefly develop one point made by my noble friend Lady Kennedy, who referred to the work of Sheffield Hallam University on trade, which I have read in considerable detail and previously raised in this House. That work clearly shows that, while China is one of the world’s biggest growers of cotton, it is also the world’s greatest cotton launderer, hiding where its cotton products are grown by laundering them around the world. The work at Sheffield Hallam has shown this, and, as a result, the Americans stopped importing the cotton.
As I have said previously, the Government have taken no action whatever to check the source of the cotton, but it is possible to do so. A lot of the cotton in China is grown in the Uighur area—this is a slave labour issue. I say to noble Lords, and to ladies and gentlemen, that any cotton in the clothes they are wearing at the moment can be analysed to show where it was grown and whether this was in Xinjiang or in another part of China or Egypt or somewhere else. Paper-based monitoring systems are worthless simply because China is hell-bent on laundering the cotton in its products and hiding where it comes from. Therefore, although we talk about free trade, it is not free trade if you are laundering your cotton to hide where it has come from. The Government have repeatedly been asked to do something about the products they buy on behalf of the British public. Have they used any of the element-analysis processes organised by Oritain to check the source of their cotton? The answer is no.
They have never taken any steps whatever to source the cotton and see whether it was grown in Xinjiang or not. Is that because we do not care about the use of slave labour or the source of materials? Well, I think we should and the noble Lord, Lord Alton, has given the House a further opportunity for this issue to be raised.
Lord Berkeley of Knighton (CB)
My Lords, on the whole I tend to support the idea of having one’s sparring partners join the club, because there is then a way to communicate. The noble Baroness, Lady Kennedy of The Shaws, made this point. Communication is incredibly important, such as through cultural and sporting exchange.
However, the points made by my noble friend Lord Alton seem to me to rather trump that consideration. The noble Lord, Lord Hamilton, said that we would be making an exception in the case of this country. But why would we make an exception? I suggest that the answer lies in my noble friend’s point that the country has behaved exceptionally and therefore that we have to take that into account.
Finally, I say that we must learn from the Post Office affair, for example, which we will come on to, that we can never probe enough—we need to look at things in depth, especially something such as this where there are clearly areas that we could consider more thoroughly. I repeat what the noble Lord said: this is a plea to look further. It is not doing anything else at this stage. It asks the Government to allow us to look further at something that has considerable consequences.
Lord Leong (Lab)
My Lords, I thank all noble Lords for their contributions and the noble Lord, Lord Alton of Liverpool, for presenting this amendment calling on the Secretary of State to publish a report assessing the potential impact of China’s accession to the CPTPP on the United Kingdom and saying that both Houses of Parliament must be presented with a Motion for resolution on the said report.
As the noble Lord, Lord Lansley, indicated earlier, we on this side of the House would have preferred this amendment to cover all new accession countries—but for the purposes of this amendment I will refer just to China. Several noble Lords spoke in Committee on the case for this amendment and I do not propose to repeat what was said. However, I will make noble Lords aware of China’s non-market trade practices and its history of using economic coercion against CPTPP members, which must be considered in any valuation of its prospective accession.
First, there are aggressive military exercises and drills in the Taiwan Strait that threaten peace and stability in the South China Sea. This could be destabilising to regional trade. In addition, China has ongoing territorial disputes with other CPTPP members, including Japan, Malaysia, Brunei and Vietnam. Its willingness to use coercion against countries that disagree with it has often strained relationships with several CPTPP members. For example, it halted imports of Canadian canola and meat products in response to the arrest of a Huawei executive in Vancouver. Japan was denied access to rare earth materials in 2010 and Australian exports have suffered from Chinese import bans. Furthermore, several CPTPP member states have expressed concerns that China’s subsidies of state-owned firms and arbitrary application laws would be likely to make it hard for the country to join the trade pact.
I wanted to quote two examples, but the noble Lord, Lord Alton, mentioned the Japanese State Minister, so I will leave it at that and bring in another example of our very own British CPTPP trade negotiator, Graham Zebedee. Without commenting specifically on China’s application, if a country’s economic rules are really quite far apart from what CPTPP says, inevitably there is quite a big question about whether they could undertake really massive reforms. These concerns alone seem to provide sound justification for the commissioning of a report and Motion for resolution, as required by this amendment, so that both Houses of Parliament have the opportunity to fully consider the case for and against China’s accession to the trading bloc.
Recent newspaper reports have shown the lengths to which President Xi will go to crack down on companies when strengthening his control of the economy. Business leaders in China are under immense pressure. Last year, more than a dozen top executives from sectors including technology, finance and real estate went missing, faced detention or were accused of corruption practices. China’s national security law, as mentioned by my noble friend Lady Kennedy, is dangerously vague and broad. Virtually anything could be deemed a threat to national security under its provision and it can be applied to anyone on this planet. This law has provided little or no protection to people targeted. Lawyers, scholars, journalists, pastors and NGO workers have all been convicted of national security offences, simply for exercising their freedom of expression and defending human rights. Business leaders may face the same treatment.
China’s current policies and practices are at odds with many of the provisions and requirements of the CPTPP, and it is unlikely to be able to conform to them unless current members agree to significant concessions in the negotiations. This is why concerns about coercion are particularly relevant. Without considerable concessions, it is hard to see how China would qualify for accession. Equally, China is highly unlikely to make the changes to its laws and regulatory systems that would be required to gain the acceptance of CPTPP.
We are obviously sympathetic to the arguments made by the noble Lord, Lord Alton, and others in support of this amendment. However, there is not yet any agreement for any other country to join the partnership. It would be improper to single out any one of the possible new members at this stage, including China. At Second Reading and in Committee, we put on record our strong concern about China’s human rights record, but we believe that our human rights concerns should be universal and that one country should not be singled out. Should the noble Lord, Lord Alton, decide to divide the House on this amendment, we will abstain.
Lord Johnson of Lainston (Con)
My Lords, I am grateful for this debate and I have the greatest respect for my noble friend Lord Alton, who, over the years, has demonstrated his significant level of passion on this very important matter, as have many other noble Lords today. I do not want to deviate from the important points I wish to make relating to this CPTPP Bill, so forgive me if I do not necessarily answer all the questions that have been presented in relation to some of the topics raised. However, I would like to say, very importantly, that I clearly personally strongly reject the sanctioning of our parliamentarians. We have made it very clear before that China’s attempts to silence those highlighting human rights violations at home and abroad, including, and specifically, their targeting of MPs and Peers here in the UK, are unwarranted and unacceptable. I begin discussion on this amendment with that very important statement.
I turn to the debate around the CPTPP. As I have made clear throughout the last few stages of this Bill, in joining CPTPP, we are securing our place in a network of countries that are committed to free and rules-based trade, which has the potential to be a global standard setter. CPTPP acts as a gateway to the dynamic and fast-growing Indo-Pacific region and delivers on last year’s integrated review refresh to continue to enhance our relationships in that region. I stress this point, which was raised, I believe, by the noble Lord, Lord Purvis. Expansion of this agreement’s membership will only bring further opportunities for British businesses and consumers.
On potential new accessions, there are currently six economies with applications to join the group: China, Taiwan, Ecuador, Costa Rica, Uruguay and Ukraine. China’s application, alongside the applications of the other five economies, is at the outset of the application process and has certainly not been determined. As noble Lords are already aware, the CPTPP is a group of 11 parties and will become 12 when the UK accedes, and decisions must be taken by consensus of the CPTPP parties. However, it has been agreed within the group that applicant economies must also meet three important criteria: they must meet the high standards of the agreement; they have to have demonstrated a pattern of complying with their trade commitments; and they must command consensus of the CPTPP parties. These are very strong criteria, and I hope that all Peers on all sides of the House hear this very clearly.
As a new member of the CPTPP group, it is right that we work within the principles of the group to achieve a consensus decision, rather than give our own individual narrative on each applicant, such as through the report proposed in this amendment. My kinsman and noble friend Lord Hamilton made a very strong point in support of that. As I indicated previously, the UK is already closely involved in discussions on this topic but will have a formal power to oppose an application only post-ratification. It is therefore crucial that we ratify the agreement and become a party, so that we can work with CPTPP members decisively on each current and future application. I stress that to be drawn in on individual applicants now, ahead of the UK becoming a party to the agreement, could risk significant repercussions to our own ratification, which is why this is such a sensitive and important issue.
The UK becoming a party of the CPTPP is dependent on CPTPP parties individually choosing to ratify the UK’s accession, so it is not in our interests to step outside the group on such a sensitive issue. As I have been clear throughout our debates, we must join first so that we are on the inside judging other applications, not vice versa. It is therefore crucial that the UK ratifies the agreement, which will in turn trigger other ratifications that will allow us to become a party.
I want to be clear that our own accession working group was successful because we are demonstrably a high-standards economy with a strong track record, we made a market access offer of the highest standard, and we garnered the support of every party for our accession. Our accession process has set a strong precedent: the robust experience the UK has been through has reinforced the high standards and proved the bar is not easy to meet.
Comments were raised about state-owned enterprises. I will give noble Lords an anecdote from the negotiating team, as I understand it. We received a great degree of scrutiny over the relationship between Channel 4 and the Government, which few people, I think, would necessarily equate with the concept of a state-owned enterprise. I hope that that demonstrates the sort of inquiry that was behind our own accession.
I also reassure the noble Lord, Lord Alton, and everyone else who participated in this debate, that the accession of new parties after the UK has joined will entail a change in the rights and obligations of existing parties. Any new agreement requiring ratification by the UK would therefore be subject to the terms of the Constitutional Reform and Governance Act 2010. So, if he will allow me, I push back against the noble Lord and his suggestion—I think the noble Lord, Lord Purvis, also suggested it—that there is no track for the CRaG process to be triggered should a new party be able or about to accede to the CPTPP.
Lord Alton of Liverpool (CB)
The Minister made an important point, so I will press him on it, as I did during the meeting we had with officials. Can he confirm that the CRaG process does not provide for a vote in either House of Parliament?
Lord Johnson of Lainston (Con)
I am grateful to the noble Lord, but, if he will allow me, I will continue with my comments on what this process will involve. As noble Lords are aware, the CRaG process requires that the treaty text and an Explanatory Memorandum be laid before Parliament for 21 sitting days before ratification can take place. Under CRaG, either House can resolve against ratification of a relevant treaty within the 21 sitting days of the treaty being laid before Parliament. The House of Commons can continue, indefinitely, to resolve against ratification, in effect giving the Commons the power to block ratification. I hope that that answers the noble Lord’s question.
These are clearly quite dramatic actions to take on behalf of both Houses in relation to the CRaG process, but the point is that the levers are available. While there is no explicit up/down vote built into the CRaG process, there are multiple ways in which a debate can be brought to the Floor of the House. Should it be the will of the House to have a substantive debate, I am sure that Parliament would ensure that it would occur. I believe that that is referred to as the Grimstone principle.
Lord Purvis of Tweed (LD)
My Lords, on a point of clarification, the Minister told us that it would be wrong for a country to comment on another country’s application and gave reasons for that to be the case, but the Government sought in our application support from other countries, and indeed welcomed Japan’s public comments that it would welcome UK accession. Why did we previously seek and welcome support from other countries for our application if the Government are now saying it would be dangerous if we made any comment about China’s potential application?
Lord Johnson of Lainston (Con)
I am grateful to the noble Lord, Lord Purvis, but it may surprise him to know that we are not yet fully acceded or party to CPTPP. As soon as we are, it is absolutely right that we make comment on other countries, but only after the process and we have joined. To include an amendment in the Bill now would be completely inappropriate, as I hope I have made clear. I think it would cause significant issues in this overall process.
I return to the point on which it is important to reassure the House. The House is looking for reassurance about whether any country can be sneaked under the wire to join CPTPP, and the clear answer is that it cannot. We have made clear commitments to clarify the process from the Dispatch Box to ensure that we know, as Members of this House and of the other place, that there will be a robust process around any new party joining CPTPP.
Lord Alton of Liverpool (CB)
I am very grateful to the Minister, but I am trying to get clarity to see whether we need to divide the House. He has not answered the question I asked. He has said that there could be a process by which there could be a debate on the Floor of the House if the Government permitted it. All that would be welcome, if it was permitted. My question was whether such a Motion would be divisible. Would there be a chance for Members of both Houses to vote? When I asked that question during the course of our meeting, the answer I was given was no.
Lord Johnson of Lainston (Con)
I thank the noble Lord for his comment but I feel he is being slightly unfair to me. I am describing the CRaG process, and the Grimstone principle makes clear what will happen if there is a desire for a debate and parliamentary time allows—I am obliged to use those caveats, as your Lordships can imagine, but frankly it would be astonishing if there was not a significant and strong debate over any country joining CPTPP. As I said, and as the noble Lord will know from his experience, the House of Commons can continue indefinitely to resolve against ratification, in effect giving the Commons the power to block ratification. I think that is a very significant and probably quite considerable device that would enable the noble Lord to feel reassured on that point.
The question is whether a new party joining CPTPP would trigger the CRaG process. In our view, it absolutely would, which gives enormous power and scrutiny to both Houses in ensuring that there is a proper debate on that. It is important to note, as I think was mentioned by the noble Lord, Lord Berkeley, that, in the event of the CRaG process being triggered, I would expect the Business and Trade Committee or the International Agreements Committee to request a debate, and that the Government would seek to facilitate this, subject to parliamentary time, as under the Grimstone principle, which we have covered.
I would like to come to a conclusion here. I note the important contribution made by the noble Lord, Lord Kerr, in Committee. He commented that he did not believe that this amendment was “necessary or desirable”, and recognised the importance of unanimity among members. I want to bring us back to that point. We are now part of a group that has attracted interest across the world.
Baroness Hayman (CB)
My Lords, I apologise for intervening, particularly when I have not taken part in these debates before, but I want to ask a question before the Minister leaves the issue of the CRaG provisions, which are very important for some of us who have listened to the debate and have an issue. He said clearly just now that the House of Commons could resolve against ratification, but the noble Lord, Lord Alton, was asking if it could have a vote. How would the House of Commons resolve against ratification without voting on the issue? That is what I struggle to understand.
Lord Johnson of Lainston (Con)
I am grateful to the noble Baroness for her point. There is no explicit up/down vote built into the CRaG process; we are aware of that. I am talking to a House that has far more experience of the CRaG process than I do, so we know how the process works. There are multiple ways in which a debate can be brought to the Floor of the House. For reassurance, I will go through this point again. The CRaG process requires that a treaty text and an Explanatory Memorandum be laid before Parliament for 21 sitting days before ratification can take place. Under CRaG, either House can resolve against ratification of a relevant treaty within the 21 sitting days of it being laid before Parliament. The House of Commons can continue indefinitely to resolve against ratification, in effect giving the Commons the power to block ratification.
To some extent, this is important, but it may be academic. As I said, the question is whether a new party to CPTPP can be snuck under the wire. We are very clear that this is not possible. The process is automatically triggered. Aside from that, there are also the reports written by the Trade and Agriculture Commission, and there has to be an impact assessment, and there has to be a significant amount of scrutiny and debate, as there is about the CPTPP Bill today. I am very reassured on the principles and mechanics around whether we have in this House the right level of control and security to ensure that we have control over our own destiny in relation to new parties joining a plurilateral treaty, which is of course completely different from the country-to-country FTAs.
Lord Lansley (Con)
I am grateful to my noble friend. As a former Leader of the House in the other place and as a member of the International Agreements Committee, I am pretty clear that, under CRaG, the International Agreements Committee here, and potentially the Business and Trade Committee in another place, might make a report to Parliament that could lead to a debate. That debate could be subject to a take-note Motion, but that would be amendable. If it were sought to be amended in the other place to say that a treaty should not be ratified, the Government could not continue to ratify the treaty if such a vote had taken place in the other House to say that it should not. I think that gives the comfort that the noble Baroness, Lady Hayman, is looking for.
Lord Johnson of Lainston (Con)
I am very grateful to my noble friend for that comment. He is absolutely right that the Business and Trade Committee and the IAC are able to request a debate, which, as I said, according to the Grimstone principle, we would always seek to facilitate, given parliamentary time.
I should like to come to a conclusion. I ask the noble Lord to withdraw his amendment. I have made extremely clear, I hope, the rigorous standards that CPTPP applies. This is a plurilateral trading group that wants to have the highest standards of trade among them. That is my first key point. The second is that we have a number of safeguards built into our own processes to ensure that, were another country to join CPTPP—it could be any of the countries applying or future countries over the coming years—there will be a proper process, as has been defined in the CRaG process. I would ask the noble Lord, given the complexities and sensitivities that I believe this amendment would present to our ratification process, to withdraw his amendment.
Lord Alton of Liverpool (CB)
My Lords, I am very grateful to the Minister and all noble Lords who have taken part in today’s debate. I felt we were quite close to agreement, as I felt we were during the course of the meeting that I had with the Minister. It comes down to the issue of whether or not such a report and Motion, were it to be laid in the House of Commons, as the noble Lord, Lord Lansley, just said in response to my noble friend Lady Hayman, would be divisible or not. It has been made clear that under the CRaG process that is not possible. That is why it was necessary to table this amendment.
As for some of the other arguments put before your Lordships, I entirely agree with the noble Lord, Lord Hamilton of Epsom, who raised the issue of the United States of America. If the USA were to seek to join—it is not even in the queue or the list of countries to which the Minister referred earlier—all of us would be very pleased about that. However, China is in the list referred to, so this is not hypothetical—China is in the list. We are not seeking to have the debate here and now as to whether or not China should accede. That is not what this amendment would do. Chronologically, we are getting ahead of ourselves. The amendment would simply empower this House, should we then be members of the CPTPP, to have the right in both Houses to query such an application on the grounds that I laid out at length, as did the noble Baroness, Lady Kennedy of The Shaws, and the noble Lords, Lord Rooker, Lord Purvis and Lord Leong, in their remarks about the nature of the country that we are dealing with. Is China different from the others? Yes, of course it is manifestly different, not least, as the noble Lord, Lord Rooker, mentioned, because of the products that we buy from Xinjiang. The House of Commons has declared not that there are human rights violations but that there is a genocide—under the 1948 convention on the crime of genocide—taking place in Xinjiang against Uighur Muslims, who are used as slave labour.
The noble Lord, Lord Rooker, is right about that, and we have this trade deficit that the noble Lord, Lord Purvis, regularly refers to, of £40 billion, which makes us very dependent on that country and does not contribute to our resilience. Will the CPTPP help us? Yes, it will, and I am glad that we are joining it. That is why I support the Minister in that objective and support this Bill but, as others have said in the debate, we need to be in a position not only to be able to voice our opinions in both Houses but to vote on those things as well. Otherwise, how will we express our view? Will it be done through telepathy? Will it be done as a result of people getting up and saying, “We don’t agree with this”? If there cannot be a vote, it is impossible. All of us in this House or who have been in the other place know that to be the case.
As for the views that have been expressed about the desirability of China’s membership, my noble friend Lord Berkeley of Knighton said that this is exceptional because it is appalling behaviour that we have never probed enough. We must probe. That is what this amendment seeks to do, to give us rights. Look at the amendment. There are two parts to it. The first simply says:
“Before any decision is made by the Government … on the accession … to the CPTPP under Chapter 30 of the CPTPP, the Secretary of State must publish a report”.
That is all well and good. The Minister has accepted that principle, so why not accept the first part of the amendment? What does the second part say? It says:
“Both Houses of Parliament must be presented with a motion for resolution on the report under subsection (1)”.
This is hardly revolutionary. It seems to me perfectly reasonable. We are being invited to tilt at imaginary windmills. I know that some will be under pressure from their Whips but, as I did during the debate, I commend the remarks of the former Leader of the Conservative Party, who has written to members of his party today to say that the amendment remedies the problem in a proportionate way that goes with the grain of government policy.
I would like to seek the opinion of the House, and I hope that those on the Government Benches in particular will vote for this amendment.
“Human rights impact assessment: indigenous and forest peoplesThe Secretary of State must lay before Parliament, within 24 months of the passing of this Act, a human rights impact assessment on the impact of UK CPTPP accession on indigenous and forest peoples in the respective CPTPP parties.”Member's explanatory statement
This amendment would require the Secretary of State to perform a human rights impact assessment on the effect of UK CPTPP accession on indigenous and forest peoples.
Baroness Bakewell of Hardington Mandeville (LD)
My Lords, in moving Amendment 6, I wish also to speak to Amendment 12 in this group. Amendment 6 raises the issue of the displacement of indigenous people severely affected by deforestation resulting from the rush to clear forests for palm oil agriculture. The rainforests of the world are an essential source of carbon storage and provide homes to some of our most iconic species, which everyone is aware of. What is not so widely acknowledged is the effect that forest clearance has on the indigenous people who make their home in the forest. The CPTPP will remove tariffs on palm oil, making deforestation easier. The human cost will be devastating: nearly 1 billion people depend on the forests for their livelihood and 300 million people live in them. This displacement is enormous. An assessment of the impact on these people within 24 months of the passing of this legislation is essential. I look forward to the Minister’s comments.
The World Wide Fund for Nature has identified that two of the 11 deforestation fronts are covered by the CPTPP. These 11 fronts will account for 80% of deforestation by 2030. The Government’s proposed deforestation due diligence only covers illegal deforestation in four linked commodities. The US FOREST Act covers six, and the EU deforestation regulations cover seven, with other countries going further. The UK is lagging behind in this vital area and needs to do much more to protect this dwindling resource. There has to be a more stringent process to ensure that deforestation does not totally destroy the homes of those who are less able to speak up for themselves. A review of the effect on these people is essential.
Amendment 12 is in the name of the noble Baroness, Lady Willis of Summertown. She is unable to be present this afternoon and sends her apologies. I have added my name to this amendment, as has the noble Baroness, Lady Boycott. The noble Baroness, Lady Willis, spoke knowledgeably and passionately to this amendment in Committee. The countries which the Government are planning to begin trading with do not have the same stringent rules on the use of pesticides and chemicals as we have. This will undermine and undercut our farmers. It will also put the population at risk.
There are 119 hazardous pesticides banned in the UK which are used in the countries covered by the CPTPP. The border checks which the Government are proposing are not sufficient to be able to prevent goods containing these toxic chemicals from entering the country and the food chain. Some of these pesticides are known to kill bee populations and destroy aquatic ecosystems. The paper border checks which the Government are proposing rely just on documentation. There will be no physical check of goods which may contain pesticides. The Pesticide Action Network found that grapes from CPTPP member countries New Zealand, Chile and Peru may contain 1,000 times the amount of iprodione than their UK equivalent. This is a fungicide linked to cancer. Are the Government really going to expose the population to these toxic chemicals without proper physical checks? A review of the impact within 12 months is again essential.
I shall also speak briefly in support of Amendment 11 in the name of the noble Lord, Lord Goldsmith of Richmond Park. This again deals with adequate checks on goods containing sustainable palm oil. This is a vital amendment and I congratulate the noble Lord on bringing it forward. Had I realised early enough that he was putting down this amendment, I would have signed it. Its ethos is Liberal Democrat party policy and something we would definitely have wanted to support.
As has often been the case in the past, a new product is found to be useful worldwide and relatively cheap to produce. There is a rush to produce this product, with little thought given to the long-term consequences of its use. Such is the case with palm oil. It is a new wonder product that everyone wants; it is relatively cheap to produce and grows easily. However useful palm oil is, and however cheap its production, it must be sustainable. Wholesale deforestation in order to grow palm oil is extremely short-sighted, especially as we all recognise the value of the carbon storage capacity of trees. It is ironic that, at a time in the UK when the Government are setting ambitious targets for tree planting, they are also rushing to sign up to trade deals with countries which are destroying their forests to grow palm oil. I fully support this amendment and hope that the Minister will listen to the noble Lord, Lord Goldsmith, and agree to his amendment.
Lord Davies of Brixton (Lab)
My Lords, I support all the amendments in this group. I happily added my name to Amendment 11, but I will focus on my Amendment 9. The common theme through these amendments is of raising concerns about possible issues arising from a trade agreement. We are all free- traders now, but there is a recognition that free trade should be respectful of the limits that we and other countries set to protect labour standards, the environment, food quality and so on. There is a balance to be achieved and this series of amendments raises issues of concern.
These amendments are all limited, because the Bill is limited. It is not the treaty, but just the administrative arrangements required to implement it, so it could not achieve a lot anyway. We are asking the Government to review these issues. I hope that they are of sufficient importance that they would be studied, in any event. It is possible that we do not need these amendments, as a good Government would review these issues, but they provide us with the opportunity to point out areas of concern.
My Amendment 9 concerns investor-state dispute settlement mechanisms. The investment chapter of the CPTPP contains these arrangements and allows companies to sue Governments over decisions to implement policies that impact their corporate profits, even when these decisions were made in the public interest. We debated this in Committee, and I am sorry to say that I found the Minister’s reply to our concerns less than reassuring. Referring to these arrangements, he said that that they do not
“derogate or hinder our right to regulate in the public interest, including in areas such as the environment and labour standards”.
Referring explicitly to the CPTPP, he also said that it
“preserves states’ rights to regulate proportionately, fairly and in the public interest”.—[Official Report, 14/12/23; col. GC 375.]
That sounds fine.
The International Bar Association has a similar view, stating that,
“while investment treaties limit states’ ability to inflict arbitrary or discriminatory treatment, they do not limit (and, in fact, expressly safeguard) a state’s sovereign right to regulate in the public interest in a fair, reasonable, and non-discriminatory manner”.
The problem is that these phrases, “arbitrary or discriminatory treatment” and a
“fair, reasonable, and non-discriminatory manner”,
are doing a lot of heavy lifting. They are all subject to interpretation. There have been real concerns that, in practice, commercial interests will be elevated above those of the public. There is so much there that needs to be taken on trust. The key point is that this clearly—and, I suggest, inarguably—is an issue that needs to be kept under close review, which my amendment does.
The problem we face is that ISDS arrangements have been used to challenge health provision, labour rights and other important regulations. This is not a theoretical possibility; there have been enough examples in practice to give rise to this concern. I quoted the CBI in Committee and it is worth expressing its views again—that there is
“a risk of the UK becoming disproportionately targeted through ISDS”,
and that
“there could also be environmental implications of the UK being exposed to the ISDS mechanism”.
These are not fringe concerns but concerns of different interest groups.
In simple terms, the ISDS arrangements make it possible for firms to sue Governments for measures that harm their profits. The existence of this power has a chilling effect on regulations, particularly those designed to combat climate change.
A specific example, of which we need some account, is the attitude to the energy charter treaty, under which many cases have been brought by western companies taking action against Governments to limit their use and expansion of fossil fuels. So problematic has this become that large European countries have signalled their intention to exit from this treaty. The Government themselves have said that they are reviewing their energy charter treaty membership and
“will carefully consider the views of stakeholders”.—[Official Report, Commons, 4/9/23; col. 4WS.]
Given the dawning realisation that these sorts of clauses are an impediment to climate action and to sovereign policy-making in general, it seems wrong for us to sign up to further restrictions through this treaty. I am amazed by the modesty of the demand that this aspect of the CPTPP should be subject to a formal review so that we can see what impact it is having on government corporate relations.
Baroness McIntosh of Pickering (Con)
My Lords, I am delighted to speak to Amendment 10 in my name, which is in similar terms to the amendment I tabled in Committee and requests
“an assessment of the impact of the implementation of the CPTPP Chapter on government procurement on environmental protection and animal welfare, health and hygiene”.
I am grateful to my noble friend for trying to seek me out. I missed him yesterday and he missed me today. Along with the noble Lord, Lord Alton, and a number of others, we were paying tribute at the memorial to an outstanding parliamentarian, Baroness Boothroyd. I am sorry that I missed my noble friend’s attempt to speak to me, but I am grateful for the opportunity to speak to him in the confines of these deliberations.
What has changed very clearly since Committee stage is that an announcement was made by the Environment Secretary at the Oxford Farming Conference that the Government are committing to consult on new food labelling—plans that will ensure that British produce will, as he put it,
“stand out from the crowd”.
The idea is to allow changes to food labelling entitling consumers to make better decisions at the supermarket in particular, while also highlighting high-quality British produce to the public. I quote from the press release issued by the NFU, which quotes what my right honourable friend Steve Barclay said:
“New food labelling would also make it clearer when imported products do not meet the same UK welfare standards”.
I put it to my noble friend: would it not be better if we did not import food that does not meet the high UK animal welfare and environmental standards that consumers demand and our domestic producers are honoured and delighted to meet? What is the relationship between this new labelling scheme and the Red Tractor scheme, which already demonstrates compliance with all the food requirements by domestic producers?
Is it not a fact, and does my noble friend not agree, that domestic producers meet the highest standards of animal welfare and environmental protection in their production? This means they are meeting a higher standard and it is therefore more expensive to produce. This is exactly what happened in the 1990s with the decision to unilaterally ban sow stalls and tethers in the production of pigmeat while we continued to import pork produced by sow stalls and tethers for an interim period of seven years. This meant the consumer swapped high-end, high-quality, high-animal-welfare-standard UK pig production with lower, cheaper, substandard imports. After seven years, this put our pig producers out of business.
I hope my noble friend will give me his assurance today that after six months—or 12 months in the terms of my Amendment 10—an assessment will be undertaken by his department, jointly with Defra, to ensure that the trade Bill before us this evening does not discriminate against UK domestic production, particularly of meat and dairy. In addition, can he give an assurance that the food labelling provisions that Defra is proposing to consult on, and which I support, will apply not just to supermarket labelling but will somehow translate on to the food menus for food sourced from third countries in our restaurants, bars and cafés in this country? That is the main purport lying behind Amendment 10.
Lord Goldsmith of Richmond Park (Con)
I rise to speak to the proposed new clause “Review: forest risk commodities”, which is in my name and the names of the noble Baroness, Lady Boycott, and the noble Lords, Lord Davies and Lord McNicol. The noble Lord, Lord Davies, has spoken and I thank him for his support. I also appreciated the words of the noble Baroness, Lady Bakewell, when she spoke earlier, and I strongly agree with the case she made for prioritising indigenous people. There is no cheaper or more effective solution, if we are interested in protecting nature, than backing those who have been doing that for generations. The maths and facts speak for themselves—80% of terrestrial biodiversity is in land looked after, and in some cases owned by, indigenous people, so the noble Baroness makes the point very well.
Deforestation is a major environmental crisis for so many reasons. We heard earlier from the noble Baroness that the displacement of people all over the world is causing runaway biodiversity collapse and the loss of a terrifying variety of lifeforms. Once gone, they are never going to come back. Nearly 90% of deforestation is caused by agricultural expansion. The resulting loss of habitat has caused a horrifying decline in everything from tigers and elephants to rhinos, hornbills and orangutans. Orangutans, incidentally, are relevant to this amendment because they tend to live in areas where palm oil is so prevalent; they have lost 80% of their habitat in the last 20 years.
Forest loss goes far beyond even that. The Congo basin, whose forest is disappearing at a rate of around 1 million hectares every single year, produces most of the rainfall for the entire continent of Africa. If those trends are allowed to continue, we are going to see humanitarian crisis on biblical scales. In the Amazon too—we do not fully understand the role of the Amazon in generating rainfall, but we know it generates rainfall and that that rainfall falls in the southern states of the United States, and that without the Amazon there would be huge repercussions across that entire region—it is in everyone’s interest that stopping deforestation remains a top priority.
I have not even mentioned climate change at this point. Deforestation is now the second leading cause of climate change after burning fossil fuels. There is no credible solution to climate change and no credible net-zero plan that does not include nature at its very heart. A plan that does not include nature is not, in real terms, a plan at all.
It is for these reasons I am bringing this amendment to the House today. Noble Lords have previously expressed concern that, once ratified, the CPTPP agreement will remove all tariffs on palm oil irrespective of its environmental credentials. They are right to flag this issue, which has been flagged a number of times, because in pursuing that policy we risk, at the very least, undermining the core of our COP 26 messaging on the importance of forest.
It also contradicts commitments made by the Government under Schedule 17 to the Environment Act to tackle illegal deforestation in our supply chains. Indeed, without the safeguards of the due diligence secondary legislation in place—that safeguard is not there yet and I hope the Minister will be able to provide some reassurance about when that is going to happen—it is simply irresponsible to pursue a policy of this sort.
Around 90% of the world’s palm oil is grown in Malaysia and Indonesia. It is estimated that around 1% of Malaysian palm oil smallholdings are certified by the Roundtable on Sustainable Palm Oil. That 1% makes up around 40% of all the palm oil plantations in Malaysia. The RSPO is probably the most widely recognised certification scheme. It is voluntary, and among other things it requires that palm oil is deforestation- free.
We know what is possible when a Government are serious about this issue. We have actually seen amazing efforts and results in Indonesia. It gets very little credit for the work we have seen over the last few years, but under the leadership of a number of very impressive people, not least Minister Siti Nurbaya, that country has come pretty close—it has not done it yet, but has come pretty close—to breaking the link between palm oil production and environmental destruction. I think it should get more credit for the work it is doing, because it is a model that other commodity-producing countries could learn from.
I acknowledge and welcome, very briefly, the side agreement that the UK and Malaysian Governments have signed. It commits to strengthening efforts to conserve forests and promote sustainable supply chains, in particular around palm oils. In many respects, the statement goes further than the due diligence secondary legislation that I mentioned earlier. But the agreement still relies on the Malaysian sustainable palm oil certification scheme, as opposed to the RSPO, which I mentioned earlier. The details around the Malaysian scheme are unclear and in truth it is significantly less robust than the RSPO—I do not think anyone would argue against that.
That is why it is so vital that work is done to review the impact of that agreement once it is in place. This proposed new clause is very simple, and that is what it seeks to do. It would require a review every two years that would assess the effectiveness of that agreement, alongside the impact of the CPTPP trade deal, on the sustainable production of forest risk commodities more broadly, including palm oil of course, right the way through our supply chains. The review would also look at the impact of the deal on deforestation within CPTPP nations, and the compatibility of the deal with our own due diligence regulations.
I hope that noble Lords agree that it is a reasonable amendment. It offers a practical way of reaffirming the Government’s commitment to making sure that our own supply chains are part of the solution and not the problem, as well as empowering Parliament to hold the Government to account on this issue. The new clause is supported by a number of significant environmental organisations—WWF, Chester Zoo and others—and has support from Peers for the Planet, for which I am very grateful.
Very briefly, as I finish, I will say that in my previous capacity as Minister of State, I went to Chester Zoo and saw its pioneering work on sustainable palm oil—clearing up its own supply chains but then helping businesses in the area do exactly the same. I thank it on the record for its leadership on this issue and for its work more broadly. Its Kinabatangan Orangutan Conservation Project, which has been running for a quarter of a century, involves creating magnificent nature corridors linking up those little habitats, and making it possible for distinct and previously quite cut- off orangutan populations to meet, breed and strengthen their population.
We need to ensure that the environmental safeguards we put in place, such as this UK/Malaysia agreement, are effective. That is the purpose behind this amendment. Of course, a stronger, better and easier policy would be to remove tariffs entirely on commodities from countries that have broken the link between agricultural commodities and deforestation, or conversion of important ecosystems. We know that is possible: Gabon has broken the link between logging and deforestation; Costa Rica has broken the link between agricultural commodities and deforestation, and I mentioned Indonesia earlier.
I was thrilled to see that, in the free trade agreement between the EFTA and Indonesia, there is a commitment that palm and other vegetable oils that have been produced protecting primary forests, peatlands, and related ecosystems will get preferential market access. So it is possible to build these safeguards into the primary agreement but, in their absence, we have to act now by passing something similar, at least, to this amendment. I hope that, when he responds, the Minister will be able to provide some real, meaningful reassurances that the impact of these agreements on deforestation, on our supply chain and on our role as consumers in deforestation, is properly understood and monitored, and that we are indeed part of the solution and not the problem.
Baroness Boycott (CB)
My Lords, I first declare my interests. I will come to some notes about Amendment 11, so ably spoken to just now by the noble Lord, Lord Goldsmith. Right now, I rise to speak to Amendment 12 in the name of the noble Baroness, Lady Willis of Summertown. As the noble Baroness, Lady Bakewell, just said, she is unable to be here. I would also like to say that I support Amendment 6 from the noble Baroness, Lady Bakewell.
Amendment 12 is really very straightforward, and I cannot see any reason why the Government should not let this through. It just says that our border testing regimes must be robust enough so that we are aware of the new types of products that are going to enter the UK as a result of this trade agreement. We know that many countries in the CPTPP have products that contain levels of pesticides that exceed our safety limits, or indeed are actually banned because of their risks to human health, food safety and consumer protection, and are not covered at all by any import tolerances.
As the noble Baroness, Lady Willis, described in Committee, and as the noble Baroness, Lady Bakewell, has just reaffirmed, there are 119 pesticides that we ban that are permitted for agricultural use in one or more of the countries we are aiming to enter into a trade negotiation with. UK pesticide standards are stronger than those of the other countries and there is no expectation, I hope, that we are going to change our high standards. So, a successful trade agreement—which is presumably what the Government are after—will inevitably lead to some increase in agricultural imports to the UK. Indeed, the strength and effectiveness of our border control systems is an issue of relevance to all existing FTAs, not only to new ones.
The Trade and Agriculture Commission flags the
“likely pressure that will be placed on the UK’s border control regime”
as a result of the increase in trade, in combination with the new EU border control model. Reports on the ground, including from the NFU, flag the lack of inspection of products coming into the UK, and the risk of this to our biosecurity. This amendment is simple and pragmatic. It provides an opportunity for the Government to scrutinise the existing system to ensure that it operates with maximum effectiveness.
I turn now to Amendment 11, in the name of the noble Lord, Lord Goldsmith, which is a further iteration of the one we tabled in Committee. Following on from his remarks, the purpose of the amendment is to both highlight our susceptibility to commodities linked to deforestation and to get assurances that the Government’s statutory review will consider this issue.
Since we last discussed it, the arguments have only been strengthened by the Environmental Audit Committee’s report on deforestation. It flagged that, in their first revision to the Environmental Improvement Plan, the Government committed to use their trade agreements and trading relationships
“to support the United Kingdom’s strong environmental and climate commitments”.
Despite this, in the course of the negotiations, we eliminated import tariffs on palm oil, which had been set at rates of up to 12%, from all CPTPP members, including Malaysia. So what is that going to do in terms of keeping sustainable palm oil production alive?
While it is true that we have existing agreements with many of the countries already, we do not with Malaysia and so it is of significance that this agreement will allow Malaysian palm oil—not necessarily sustainable —to enter the market with no tariff. As raised by Chester Zoo in its letter to Peers, around 90% of the world’s oil palm trees are grown on a few islands in Malaysia and Indonesia. Estimates suggest that as little as 1% of Malaysian palm oil is actually certified.
The EAC also noted that:
“While the UK is only the 15th largest contributor”
to tropical deforestation, we actually have a very intensive use. This is to do with our diet, which is so largely made up of ultra-processed food—66%, in fact—that depends on palm oil, when food products are smashed back into their original chemical state and then reconstituted to make the kinds of products that so carelessly litter our shelves. It seems to me that we therefore have a responsibility in this area.
I also want to challenge the idea that we are starting from a high point. We are not. Even if the Schedule 17 regulations were in place, they would apply only to illegal deforestation. That means that if a country decides to legalise deforestation, we have absolutely no recourse to stop those products entering our market. Legal or illegal, the damage is the same, and it should be treated as such. The EU regulations that are coming into force cover both, and I note that the EAC has recommended that legal deforestation be included within ours.
I would appreciate it if, in his winding-up speech, the Minister were able to confirm that the review that the Government will carry out in two years’ time, which he referred to in Committee, will take into account these concerns; and specifically if he can confirm that the joint statement with Malaysia to tackle deforestation and the MSPO—the Malaysian Sustainable Palm Oil Certification Scheme—have been effective. I also want to note my support for other amendments in this group.
Baroness Hayman (CB)
My Lords, I declare my interest as chair of Peers for the Planet and wish to simply record my support for the speeches that have already been made. I think all the amendments have been well argued, and I will not repeat what has already been said. The only exception to that is that I would like to say a few words on Amendment 9 from the noble Lord, Lord Davies of Brixton, on ISDS. I referred to this briefly in Committee.
The investor-state dispute settlement mechanism was brought in with those specific purposes to allow firms to bring arbitral proceedings against Governments of member states in which they had invested for actions which violate their economic rights. It did a good job at that, but I was very struck when the Minister said earlier in today’s debate that we have to look to the future, not the past. What is happening at present under ISDS provisions makes us think that perhaps the need for review is in fact urgent, and that, for the future, we need something better. My concerns are particularly around the effect that the provisions can actually have on the Government’s ability to govern, regulate and take measures of environmental protection. This is a widely held view.
Baroness Hayman (CB)
Indeed. In July 2023, the UN special rapporteur on human rights and the environment, David Boyd, talked of the “catastrophic consequences” of ISDS for climate and environment action and human rights. We should take that seriously. As a country, we do not always have a coherent approach to ISDS provisions. On this treaty, we have agreed to side letters excluding ISDS with Australia and New Zealand, but we have not asked for a similar side letter for other countries and for other exclusions. It is piecemeal, and it is a system that has been useful but now needs to be reviewed, and is not fit for purpose in 2024. In that respect, as the noble Lord, Lord Davies, mentioned, we also have to look urgently at the energy charter treaty. I was slightly encouraged by the Minister’s colleague the noble Lord, Lord Callanan, when I last asked him on this issue when we would withdraw from the energy charter treaty, as other countries have. I asked if he might be able to announce it at COP 28. Sadly, he did not, but any announcement soon on this issue would be welcome.
Lord Curry of Kirkharle (CB)
My Lords, I rise to speak to Amendment 12 tabled by my noble friend Lady Willis. I also very much support Amendment 10 tabled by the noble Baroness, Lady McIntosh of Pickering, and support her comments this evening.
As I mentioned during earlier stages of the Bill, I have been extremely concerned about the potential impact on domestic food production of the various trade deals that the Government have negotiated. Of course, it is vital that we negotiate trade deals that encourage reciprocal trade and benefit the economies of those involved. We absolutely need to do that. We in agriculture need access to global markets to have the opportunity to expand the range of excellent food products produced here in the UK. I fully respect the fact that other partners to this agreement expect access to our markets.
We are not afraid of competition. We have some of the most efficient farmers in the world, but competition must be fair. I am reassured by the Minister, in his opening statement this afternoon, that domestic standards will not change and will not be weakened. I thank him for that confirmation. However, that is not my primary concern. For those not close to the world of farming, let me explain what is currently taking place.
Farmers are about half way through a seven-year transitional period which involves the most radical shake-up of agricultural policy in over 70 years. All direct support is being removed, so that within about three years there will be no direct subsidies. Farmers will have to survive unsubsidised in the marketplace. Any future support will change to incentivise farmers to deliver public goods, mainly environmental outcomes, which is very appropriate in the light of climate change, loss of habits, et cetera. However, for farmers to survive and trade successfully in a very competitive global market, it is essential that competing businesses are able to operate under the same trading rules.
As has been stated by the noble Baroness, Lady Bakewell of Hardington Mandeville, and my noble friend Lady Boycott, within this CPTPP agreement are countries where over 100 chemicals are used that are banned here in the UK. Not only does this represent a serious commercial disadvantage for UK farmers: we have to believe that they are banned for good reason. They were harmful either to ecosystems, or to people. I am sure that exporting partner countries will give us assurances that food commodities and products sent to the UK will conform to our high standards. However, it will be impossible to audit the myriad production systems to verify that this is the case. Therefore, this amendment is necessary to protect ourselves from potentially harmful chemicals and our farmers from unfair competition. It is important not only that our standards are not diluted but that we set international standards that are applied within this important trading partnership. We have an opportunity here to demonstrate global leadership, and we should seize it. The same principle applies to animal welfare standards and to our commitment to deliver higher environmental standards. I hope that the Minister will accept the principles behind these amendments.
Lord McNicol of West Kilbride (Lab)
My Lords, this group is the meat of Report. We have eight amendments in this group, and many have been ably introduced and explained. We have had detailed debates on all these issues in Committee, so there is no need to rehash all the arguments. I have tabled two amendments in this group and added my name to two others. I thank the Minister and his officials for making themselves available for discussions both before Committee and before Report. I will concentrate on the four amendments to which I have put my name. To be clear, like others, I am seeking commitments from the Minister on the quality, detail and depth of the impact assessment that the Government have committed to. We will listen to his response. The noble Lord, Lord Goldsmith of Richmond Park, said he was seeking meaningful reassurances.
Impact assessments are a good thing. Understanding the effects of any new settlement, both the positive and the negative, is a sensible way of learning the lessons, especially as CPTPP, although small in the scale of trade, is varied in terms of the countries involved. Impact assessments on ISDS, animal welfare, pesticides, commodities, workers’ rights, forestry and public services are therefore vital tools in understanding the successes and failures, the winners and losers, of this deal. If the Minister truly believes in the CPTPP and is confident that its impact will be wholly positive, surely he will have no problem with this undertaking.
I turn to the amendments. Amendment 13 deals with labour standards. The basis for this amendment is very straightforward. Unions both here and abroad have deep concerns about the inadequacies of the labour chapters and the fact that the agreement would consider an infringement of labour rights actionable only if it is proved to have a deleterious effect on trade. The fact that many of the countries we would be joining do not comply with even the most basic ILO standards compounds this structural problem. Indeed, with regard to the eight ILO conventions, Brunei has ratified only two and Malaysia and Singapore only five each. Five of the 11 CPTPP nations have not ratified the convention on the freedom of association. In Mexico, for example, companies regularly engage in union busting and in Vietnam, union leadership is often controlled by senior management. It is important to note that no CPTPP Government have ever challenged another over labour rights violations. We are concerned that not only does lowering the barriers to trade with these countries encourage the continued abuse of workers globally but it could undermine the protections we have here for the sake of competitiveness.
The other reason for this amendment is so that we can assess the potential negative effects on UK businesses. We have heard this from a number of noble Lords. None of us wants to see the undercutting of UK manufacturers and producers by forced labour or breaches of labour standards. We are all aware of the US pausing imports of goods where forced labour was used.
Amendment 14 deals with the impact of the procurement chapter on UK public services. Many have raised the issue that the negative list approach to service listing in the CPTPP could expose the NHS to further privatisation. The ratchet clause as well as the ISDS provisions could preclude the Government taking services back under public control if it affected a private business’s profits. The Government have argued that the NHS will never be on the table, but it is hard to see how that can be true if they have made no effort to take it off the table. This amendment calls for an impact assessment to monitor progress in this area.
Amendment 9 deals with the ISDS—investor-state dispute settlement—provisions in the agreement. My noble friend Lord Davies of Brixton explained this in detail. Many other noble Lords have rightly highlighted this issue in particular. Given that the Government, by implication, agree that the ISDS provisions are outdated and dangerous by signing side-letters with Australia and New Zealand to preclude their use, it seems strange that the Secretary of State for Business and Trade would reject calls to do a similar deal with Canada, a particularly litigious member of the CPTPP, as many US businesses can testify.
It is vital, therefore, that we monitor the effect that ISDS has on our standards, and that is why an impact assessment is so important. My noble friend Lord Davies called for a close review, and he is correct. He also noted the chilling effects on government decision-making, which relates to the point made by the noble Baroness, Lady Hayman, about Governments making decisions because they are concerned about their sovereign policy-making being affected by other businesses.
Lord Johnson of Lainston (Con)
My Lords, I thank all noble Lords who have participated in this debate, particularly the noble Lord, Lord McNicol, for his engagement, his very good summary of the various amendments and the points that he raised. If the House will indulge me, I will go through the different points quite carefully because there are so many elements. I beg forgiveness if I do not cover every point. My noble friend Lady McIntosh laid down a very great number of requests, which I am happy to answer outside this debate, with the broad provisions to be raised where I can.
Let me stress again how seriously this Government take parliamentary scrutiny of our FTA agenda. With this in mind, a full impact assessment for the UK’s accession to the CPTPP was indeed published at signature in July 2023, which is important to note, alongside the accession protocol text and a draft Explanatory Memorandum. This included assessments of potential economic impact on UK GDP and environmental impacts. This is important. I will refer back to the Section 42 report where relevant to reinforce and, hopefully, reassure Members of this House of the benign impact of CPTPP membership on our environment and border controls.
I want to pick up on a point made by my noble friend Lady McIntosh of Pickering about supporting our farmers and agricultural producers in this country. It is absolutely at the core of this Government’s policy to do that. The reason I am excited about the CPTPP is because of what we will be able to achieve when it comes to promoting our dairy industry: the additional quota access that we will have, for example, for cheese into Canada; the opportunities we will have to sell chocolate into Malaysia, reducing tariffs significantly; the opportunity to sell Scotch whisky into many of the CPTPP countries with lower tariffs.
We can combine these trade agreements with the extraordinarily strong work done by my noble friend Lord Offord of Garvel, who is in his usual place today, with regard to supporting exporters, and with the muscle of the Department for Business and Trade, the work of the agricultural attachés, and all that we are doing to promote exports around the world. This is why we are here. This is a positive and powerful expression of the extraordinary economic reach of the United Kingdom, particularly in its agricultural sector. I understand that there are concerns, and I will cover them, but let us understand why we are here in the first place: to promote our agriculture—an extraordinarily powerful sector in this country—to expand its interests abroad and create more wealth for farmers in the United Kingdom.
I want to touch on the monitoring report, which we will publish after two years, as well as a comprehensive evaluation of the agreement after five years. This will include an assessment as to the environmental impacts. An inclusive and participatory process will be at the heart of the evaluation, providing structured opportunities for a wide range of stakeholders to share their views and provide evidence; that is, basically, a proper assessment and review.
I do not think it would be helpful to be specific on every single checkbox. I am keen to make any review useful. But I would be surprised—that is the language I wish to use—if the evaluation and monitoring reports did not cover information on: trade flows under CPTPP; utilisation of the agreement; ISDS cases, which will be important to many speakers today; an overview of the work of the committees under the agreement to facilitate co-operation and implementation—that is particularly relevant when it comes to labour standards, environmental standards, reduction of the risk of deforestation and many other areas. There will be information on the environment covering many of the issues discussed today and on the impact of the agreement on all parts of the United Kingdom.
This is important. I have been asked to make commitments at the Dispatch Box, and I am very comfortable doing so. It is vital to me as a proponent of free trade that we promote the benefits of this extraordinarily powerful multilateral agreement; I hope that will be shown in the impact assessments and in the reviews after two years and five years. My principal point about the amendments that have been put forward on this Bill is that they are unnecessary because we are doing this anyway.
I turn to deforestation and the issue of palm oil. I am very grateful to my noble friend Lord Goldsmith for his amendment and for the passion that he brings to this vital subject. I believe that he is to be celebrated as someone who has truly brought to bear some significant changes to the legislation of this country following on from the Environment Act and the secondary legislation around the obligations on businesses relating to deforestation, which we will be bringing in; I am reassured by my officials that we are aiming for spring of this year. I want to applaud the work of my noble friend and say how important it is, and how vital for the future of this country and the world, that trade does not lead to a degradation of our environment and natural habitats.
My son came to watch some of this debate. He has now left; I think the third hour was the final straw for an 11 year-old. We are doing this in order that our children will have a world to inherit, as well as a strong economy in the United Kingdom. At no point have we ever suggested that we should separate our obligations to the future of this planet in relation to the importance of free trade. Those who do that are mistaken. In my view, they are inextricably linked. The positives of free trade are so significant and the opportunity for dialogue allows us to solve these problems.
I want to touch on the point about palm oil, which is very powerful. The Trade and Agriculture Commission, for whose feedback I am extremely grateful, has noted that the Malaysian sustainable palm oil certification had become a mandatory condition since January 2020 for the palm oil industry, as has been raised. The new 2022 version prohibits palm oil cultivation on land cleared after December 2019. This is very important. Provided that this new standard is fully implemented by January 2025 and compliance with it is effectively enforced, there is a
“low risk that Malaysian palm oil exported to the UK would come from land that was deforested after December 2019”.
It goes on to say:
“Moreover, the UK may be able to enforce Malaysia’s implementation of the 2022 MPSO standard if failure to do so has an effect on bilateral trade”.
That is extremely relevant.
My noble friend Lord Goldsmith was right to point out that we are signatories to the Glasgow Leaders’ Declaration on Forests and Land Use, which commits both parties—clearly, we are looking at Malaysia in this instance—to halt and, indeed, reverse forest losses by 2030. This is the whole point about the CPTPP. It allows us to align our values with our partner countries, to raise their standards, to enable and facilitate, through the power of free trade and the wealth that it creates, the opportunity to improve their environment. I am grateful to my noble friend for pressing us on these points and I hope that I have answered his questions to his satisfaction.
Lord Goldsmith of Richmond Park (Con)
I rise to intervene, but I have been caught by the House with a nut in my mouth, which is terrible timing—if I could have thought of some medical excuse, I would have done so. I thank the Minister very much for his passionate call for harmonisation of trade and nature. He is right; there should be no separation between the two. I was pleased by his commitment that the diligence legislation will come in the spring. I know that it is not entirely in his hands, but I am pleased if that is the assurance that he has had from officials. It is important that it should come through. Without that legislation, the risk remains. It will be like closing the last hole in the bucket. I am grateful for his reassurances. I encourage him to continue to push the other departments responsible, but I thank him very much for his words.
Lord Johnson of Lainston (Con)
I thank my noble friend for his comments.
I turn to Amendment 12 on pesticides, which have been raised by the noble Lord, Lord McNicol, and the noble Baroness, Lady Boycott—and I had conversations with the noble Baroness, Lady Willis, as well earlier this week. It is very important for noble Lords on all sides of the House to know about the work that I have personally been putting in to ensure that we have the right and appropriate border checks and security, and that the agreements allow us to ensure that we have control over our borders. I refer to my opening comments a few hours back that this free trade agreement—on implementation day plus one, or accession day, or on becoming a party to the CPTPP—makes no difference at all with regard to our import controls and our ability to control our own destiny. This is very relevant. It is essential, again, to return to the Trade and Agriculture Commission’s report, which says that the
“CPTPP has no effect on the UK’s existing WTO rights to regulate the import of products produced using pesticides that are harmful to UK animals, plants, or the environment”.
It is crucial to remember that. We would never derogate our responsibilities to our consumers. I am very grateful for the points raised by noble Lords today to ensure that they can feel a high degree of comfort that this is simply not the case, and that we have not done so by signing up to this agreement.
I want to touch on some of the comments made about the practicalities of administering our border controls. I took the liberty ahead of this debate of visiting our Thames Gateway port system and was shown the operations there in relation to risk-based assessments. I think that is the right way to manage our borders. It would be impossible to check every single thing coming through. It is very important to reinforce the point that the CPTPP does not grant equivalence on exporting parties. We are able—indeed, it is considered that we have increased our ability—to audit exporting parties’ mechanisms for their own domestic testing to ensure that there is robustness around the testing processes before food is exported to the United Kingdom. We believe that, fundamentally, compliance is high. Our ongoing monitoring programme provides assurance that food on the UK market complies with our rules and is safe to eat.
Baroness Bakewell of Hardington Mandeville (LD)
My Lords, I thank all noble Lords who have taken part in this debate, which has allowed us to look at the impact of a number of issues around the CPTPP. I thank everybody for doing that.
I am particularly concerned about the announcement by the Secretary of State at the Oxford Farming Conference about labelling. I find it astounding that a label might say that the goods have not been produced to the standards that are pertinent here. I agree that it would be much better if those goods were not imported in the first place rather than relabelled when they got here.
I thank the noble Lord, Lord Goldsmith, for his support. It is really important that we deal with the issue of making sure that iconic animals do not lose their habitat. An 80% loss of habitat means that we will no longer have those iconic species.
The Minister is very excited about the effects of the Bill and the opportunities it will produce for farmers. I am afraid I am not quite as enthusiastic as he is. I hope it will be exactly as he says, but I am afraid that, as far as I am concerned, the jury is out. I will have to wait to see what happens.
On pesticides, I cannot see that testing by taking at face value a form that has been filled in, and not doing any spot testing of actual products, will ensure that toxins from the other countries we will be trading with will not find their way here. The importation of goods with pesticides in will damage our farmers. I thank the noble Baroness, Lady McIntosh of Pickering, for giving us the powerful example of what happened to pig farmers when pigmeat produced in substandard conditions was imported into this country. It undercut our pig farmers, who were absolutely wiped out.
Having said all that, I think I will have to wait to see what happens. I beg leave to withdraw the amendment.
Lord Foster of Bath
“Qualifying countries(1) Section 206 of the Copyright, Designs and Patents Act 1988 (qualifying countries, individuals and persons) is amended as follows.(2) In subsection (1)(bb) for “Rome Convention” substitute “Comprehensive and Progressive Agreement for Trans-Pacific Partnership”.”Member’s explanatory statement
This amendment would remove the Rome convention (and therefore its parties) from the definition of a “qualifying country” and substitute it with the CPTPP (and therefore its parties).
Lord Foster of Bath (LD)
My Lords, I congratulate the Minister on his tour de force in responding to the large number of amendments in the last group. I hope that the mere two amendments in this group will make life a little easier for him.
I have tabled these amendments merely to enable further debate on an issue that, frankly, was not satisfactorily resolved in Committee. The Minister is well aware that the copyright provisions in the Bill, not least in relation to performers’ rights, have caused significant confusion and concern among rights holders. In Committee the Minister sought to clarify the position. I fear that some confusion remains, but I am enormously grateful to him and his officials for the meeting we had subsequently and for the letter that he sent to me afterwards. I say to him that I have noted that the IPO consultation on the matters we are debating today started yesterday.
The upshot, for those not familiar with what this is all about, is simple: the Intellectual Property Office and the Minister believe that changes to our copyright law contained in the Bill are necessary for our accession to the CPTPP while I, rights holders’ representatives and some legal experts do not believe that that is the case. For instance, the CPTPP requires member countries to ratify the WIPO Performances and Phonograms Treaty, the WPPT. The UK did that over 20 years ago and there have been no concerns about it in subsequent years; no one has suggested that in the way we have implemented it we have got it wrong. Yet the Government now belatedly seem to suggest that somehow or other our legislation does not meet WPPT standards regarding the protection granted to performers and phonogram producers, so the law has to be changed. I note that the IPO’s consultation on changes in this area specifically says that existing arrangements in some cases are not consistent with treaties on copyright, which seems to suggest that for a long period we have somehow not been doing what we should have been under treaties that we signed some years ago.
The Earl of Clancarty (CB)
My Lords, I rise briefly in support of Amendments 7 and 8 from the noble Lord, Lord Foster. I will say only one thing on the concerns about performance rights, because the noble Lord, Lord Foster, summarised the problem very comprehensively. Before I do, I wish to thank the Minister for his extremely prompt reply by letter to our concerns on the artist’s resale right in relation to the CPTPP that we discussed in Committee and for agreeing so quickly to set up a meeting on this, which I believe will take place on Monday. I look forward very much to that.
The single thing I will say about performance rights in relation to this Bill is to iterate a concern that Music Week, in response to the IPO consultation, raised yesterday. It highlights the importance and principle of reciprocity that the noble Lord, Lord Foster, mentioned. My understanding is that, until now, performance rights have been based on the principle of equitable remuneration, but this Bill potentially puts that in danger. There is a fundamental question—as the noble Lord, Lord Foster, said—to be asked about why the music and broadcasting industries are being put through the wringer on this when they are broadly happy with the status quo. If—and it is an “if”, because there are a number of options—the Government go down a particular route whereby, because of a reduction in the money going to US labels, US music is effectively free to play in the UK but UK music, particularly new UK music, is not, the concern is that, to quote Music Week,
“domestic acts might be squeezed out by UK broadcasters looking to save money”.
I hope the Minister will agree that that kind of asymmetric, or inequitable, scenario is one that needs to be avoided—although I am sure that that point and more will be made by interested parties in response to the consultation, which I hope that the Government will look at very closely.
Lord Leong (Lab)
My Lords, I am speaking to Amendments 7 and 8, and I thank all noble Lords for their contributions.
Intellectual property, particularly copyright, plays a pivotal role in the global trade in creative content, with the UK music industry serving as a prime example of its significance. It is imperative to acknowledge the substantial impact of copyright on fostering innovation and ensuring the efficient operation of markets. Additionally, it is crucial to recognise existing obligations under international copyright treaties and ensure their full and correct implementation by the signatories of the CPTPP. While the fundamental rights encompassing reproduction, broadcasting, communication to the public and distribution are addressed within CPTPP, it is disheartening to note that member states retain the option to opt out of certain obligations. Furthermore, the non-recognition of copyright protection for the utilisation of recorded music in broadcasting and public performance remains a regrettable challenge. To comply with obligations in the CPTPP, as mentioned earlier by the noble Lord, Lord Foster, changes need to be made to UK legislation with regard to rights in performance. We share some of the concerns in the noble Lord’s contribution earlier, and we would welcome an impact assessment to help us understand some of these non-compliance cases.
Will the Minister respond to the following questions, as mentioned earlier by the noble Lord, Lord Foster? Why is the extension of rights in sound recordings and performance to foreign nationals not covered under this consultation? At the same time, can the Minister share with the House when the results of this consultation will be published? Will there be a statement on collective management organisations, given their importance for the income of composers, performers and rights holders? Can the Minister also confirm that UK musicians are able to tour throughout CPTPP member states without any barriers and checks?
Lord Johnson of Lainston (Con)
I am extremely grateful to the noble Lord, Lord Foster, for bringing this amendment, for the discussions and dialogue we have had, for the correspondence I have enjoyed with the noble Earl, Lord Clancarty, and for the excellent summation by the noble Lord, Lord Leong—I was about to say “my noble friend” because he is a good friend—who asked some key questions. I am afraid I do not have the answer to the final question that the noble Lord, Lord Leong, asked about the touring rights of artists. I will write to him on that; it is a very good point, and we very much hope that clearly the additional facilities that we have, in terms of temporary business entry for CPTPP countries, may include this. I hope it will and I will confirm this.
Some good points have been raised. In response, first, I will say that the desire to treat performers equitably is the right thing to do. Currently, there are a number of performers who are excluded from receiving the 50% mandatory royalty payment, simply because they come from another country or their work has not been registered in the appropriate fashion. The consultation, which started yesterday and will report on 11 March, is not specifically a consultation on the CPTPP, because we wanted it to be a far wider consultation around the principles of broadcast rights—but clearly it will reflect on the discussion we are having now.
Lord Foster of Bath (LD)
My Lords, I am grateful to all noble Lords who took part in the debate, and of course to the Minister for his response, although I confess that I was somewhat disappointed with it. I asked a series of questions. Why were these issues not covered when we did trade deals with Australia and Japan? I got no answer to that. I asked why Australia did not change its ways of dealing with this matter when it joined CPTPP, and which countries within CPTPP are operating in the way that the Government now want the UK to. I further asked a simple question about why we were told that the consultation—which the Minister has now said is so important on this issue—specifically says that the decisions we are taking within the Bill are not part of it. He hinted that there is a possibility of further consideration of this, and I look forward to finding a way of doing that. I say to all noble Lords that my fear is that the decisions will now be made by the Government long after your Lordships’ House has had any opportunity to have further involvement in making decisions on this issue. Nevertheless, I beg leave to withdraw.
Baroness Lawlor
“Review: application in Northern IrelandWithin three years of the day on which this Act is passed and every three years thereafter the Secretary of State must lay before Parliament a review of the application of section 4 (designations of origin and geographical indications) to Northern Ireland, including—(a) a consultation of such persons as the Secretary of State considers appropriate;(b) an assessment of the impact of European Union legislation relating to geographical indications and conformity assessment of goods listed in Annex 2 of the Windsor Framework on Northern Ireland;(c) an assessment of the impact of Northern Ireland being subject to different geographical indication and technical barriers to trade provisions to England and Wales and Scotland.”Member’s explanatory statement
This is related to the amendment in the name of Baroness Lawlor to Clause 6, page 6, line 42.
Baroness Lawlor (Con)
My Lords, I am grateful to my noble friend the Minister for discussing my Amendments 15 and 16 with me. He is taking our discussion back to the department for consultation, and his letter will follow this week. For reasons of fairness and transparency, and in the interests of having better laws, I hope he will consider the question further.
This is an enabling Bill: it is to enable the UK to be compliant with the CPTPP, for which it signed the protocol of accession last July, in order to implement the arrangements for government procurement, in Clause 3, and those for technical barriers to trade, in Clause 2. These include conformity assessment bodies and, in Clause 4, intellectual property, including the designation of origin and geographical indications, as well as performers’ rights.
Although the whole Bill extends to England, Scotland, Wales and Northern Ireland—that is stated in it—it does not apply to Northern Ireland in respect of Clauses 2 and 4, on conformity assessment and geographical indications. That is not stated in the Bill, but it is noted in the Department for Business and Trade’s Explanatory Notes, published with the Bill on 8 November. They explain that it will be under the EU, given the Windsor Framework. Both my Amendments 15 and 16 deal with the consequences of this, and I will speak to them now. I am very grateful to my noble friend Lord Jackson of Peterborough for supporting and signing these amendments.
My Amendment 16 to Clause 6, on extent, seeks to make this clear in the Bill by adding that it
“extends to but does not apply in Northern Ireland”.
However, looking at it again, I think the amendment should also stipulate this in respect of Clauses 2 and 4. That would make the position under the Bill transparent, as in the Explanatory Notes of the Department for Business and Trade.
From my noble friend’s reply and letter on this point, I understand that when his officials—to whom I am grateful—looked into the drafting of Clause 6 with the Office of the Parliamentary Counsel, the advice was that the text reflected recommended drafting practice for amending retained EU law where it extends to the UK, even if its application is to GB—the convention being that the general application
“should not usually be included”.
I will pick up on the word “usually”. We are talking here about a very unusual occurrence. The law is being made by another jurisdiction for part of the UK’s own jurisdiction, to which the Bill extends but does not apply. This is not a matter of powers delegated to different Parliaments of the UK, so perhaps my noble friend the Minister will think again about including this exception in the Bill. It should be fair to the people who may see it as extending to them but cannot see where the law says it does not apply to them.
My Amendment 15, proposing a new clause after Clause 5, would require a review and assessment to be made of the impact on Northern Ireland of its being subject to different geographical indications and TBT provisions from those in England, Wales and Scotland. To do this, it would be necessary to assess the impact of EU legislation on GIs and conformity assessments of goods so affected.
I know that as matters stand there are very few PGIs in Northern Ireland—Comber new potatoes, Armagh Bramley apples, Lough Neagh eels—and one protected designation of origin: Lough Neagh pollan. However, there may be more in future. I will not revisit the argument I have made to the Minister in other debates, but we are looking at a different sort of EU law applying to businesses in Northern Ireland for these two clauses—the code-based law of the EU instead of the common-law approach, which is more business-friendly. I will not go through that here, but it is fair that the different systems should be reviewed in comparison with the UK system.
This is all the more important given the fluid nature of the Windsor Framework and the aims of the Government, which may lead to further easing of economic and trade restrictions under EU law. Indeed, the Prime Minister mentioned in his speech of 13 December that he
“stands ready to legislate to protect Northern Ireland’s integral place in the UK and the UK internal market”.
While I am grateful for the Minister’s explanation, I am not convinced that leaving this matter to other arrangements for review under other laws is fair. Given the fluid nature of the Windsor Framework and given that the Bill extends to Northern Ireland even if it does not apply to it, a special review is needed. I beg to move.
Baroness Hoey (Non-Afl)
My Lords, I congratulate the noble Baroness, Lady Lawlor, and the noble Lord, Lord Jackson, on these two amendments.
It is important that we in this House always try to be as open and transparent as possible about what is in the law but, frankly, this Bill is very confusing. It mentions none of the ways in which Northern Ireland is excluded and only on page 15 of the Explanatory Notes is there a long list of the different parts of the United Kingdom and the provision for England, Wales, Scotland and Northern Ireland. Clause 2 applies to England, Wales and Scotland, and extends to Northern Ireland—most people reading this would think, “Great, it is obviously extended to Northern Ireland as part of the United Kingdom”—but does not apply there. Again, Clause 4 applies to Scotland, England and Wales and extends to Northern Ireland, but does not apply there.
The way the noble Baroness talked about the word “usual” and how unusual this is was so apt. It goes to the heart of everything in the protocol and the Windsor Framework that we have been talking about for a long time. The Government of the United Kingdom have not been open, honest or straightforward with the people of Northern Ireland about what the Windsor Framework means. Every week or month we find something new and different from which Northern Ireland is being left out. Yesterday we found it was left out of live animal exports, so poor animals in Northern Ireland can be sent over the border into the Republic and down to the south of Ireland, on to a boat and off on a very long journey to France or Morocco. We have the current debate about the Rwanda Bill; it will probably not apply to Northern Ireland in the same way.
We cannot apply this Bill to Northern Ireland because we have delegated powers to the European Union. A foreign jurisdiction and a foreign court are running parts of our country. This House should be ashamed of what is happening. I very much support the amendment to bring this out into the open so that people understand that what the Government say the Windsor Framework and protocol are doing is not actually happening.
Lord Dodds of Duncairn (DUP)
My Lords, I too thank the noble Baroness, Lady Lawlor, and congratulate her on bringing these matters to the attention of your Lordships’ House and highlighting once again the importance of transparency and lucidity in these issues and their effects on Northern Ireland.
Despite the Prime Minister’s attempts to claim the Windsor Framework as a success for his leadership and the Tory Government, it has not accomplished its main purpose: to restore devolution in Northern Ireland. One reason for that has been not just the lack of substantive change in the Windsor Framework compared with the Northern Ireland protocol—it purports to replace it but in fact there was just a decision of the joint council to rename the Northern Ireland protocol as the Windsor Framework in British law—but the overselling, spin and hyperbole, particularly by the Prime Minister but also others, when it was published. It was sold as a wonderful transformation that would erase the Irish Sea border and so on, but has done nothing of the sort and could never do so.
That lack of transparency, honesty and frankness with people about what the Government could and could not do and what they were putting forward is at the heart of the problem. If their new proposals are published, we will no doubt hear more of this in the coming days and weeks, but this Bill lacks transparency for the reasons set out by the noble Baroness in proposing her amendment.
Paragraph 53 of the Explanatory Notes includes an amazing new concept in legislation passed by this UK Parliament: laws that extend to parts of the United Kingdom but do not apply there. This is bizarre. It is not highlighted or made explicit in the Bill, as the noble Baroness has said, but hidden in the Explanatory Notes. In over 300 areas of law governing the economy of Northern Ireland, we are governed by laws made by a foreign polity—in its interests, not ours—which are not susceptible to amendment and in the development of which we have no role. It is an incredible concept, but it is not new. It was first flagged up in the main body of the withdrawal agreement and the original protocol when the Government told us that Northern Ireland would be a member of the UK customs union but that the EU customs code would actually apply.
This is a concept that is not only bizarre but inherently undemocratic and unsustainable. It a concept that is at the root of the lack of devolution in Northern Ireland. Despite efforts to browbeat, bully and otherwise people in Northern Ireland, UK citizens living there simply want the right to be able to make laws and send representatives either to Stormont or to this place to make the laws that govern them. That is an entirely reasonable position.
The Government really should now learn the lesson that they should be open and transparent about what they have created and what they are about in relation to legislation which is restricted for Northern Ireland. They cannot legislate any more; they have given away the power to a foreign body. Who would ever have thought that we would have reached such a position in this mother of Parliaments following Brexit, which was about bringing back control?
I would like to hear the Minister give a commitment that, in future, these amendments will be taken on board by the Government, and that, for as long as this iniquitous position pertains, legislation being brought forward falling within the remit of Windsor Framework provisions will be explicit and say so in such legislation.
Lord Johnson of Lainston (Con)
I am extremely grateful to my noble friends Lady Lawlor and Lord Jackson for Amendments 15 and 16, and to my noble friend Lady Lawlor for the very useful conversations we have had on this matter. Of course, the input from the noble Baroness, Lady Hoey, and the noble Lord, Lord Dodds, is always extremely welcome.
I am very sensitive to this matter. To be honest, I see my role as bringing a powerful trade deal to the whole of the United Kingdom. I am very aware of the points being raised by noble Lords in this House, but, I am afraid, at this stage of the proceedings I must concentrate on the specifics.
To answer the amendments specifically, I assure my noble friends that we will keep this under review once an Act and stakeholders in Northern Ireland will be an important part of that. Regarding the application of EU law in Northern Ireland, I remain of the view that the people of Northern Ireland are best placed to scrutinise the legislation applicable in Northern Ireland once the Northern Ireland Executive is restored. The Windsor Framework will provide them access to the Stormont brake, as noble Lords will well know. This will enable them to block specific laws impacting Northern Ireland. Furthermore, there will be regular opportunities for the people of Northern Ireland to have a say, via the consent vote. These are all points that have been well raised.
The CPTPP takes account of the Windsor Framework, and it is specifically noted that this is the case. Amendment 16 is superfluous, because under the Windsor Framework the EU’s GI schemes continue to apply to Northern Ireland. Our accession to CPTPP does not alter this. The treaty, accession and becoming a party to CPTPP do not change any of the discussions that noble Lords have had previously about Northern Ireland.
Additionally, the text reflects the recommended drafting practice in Bills for amending an assimilated EU regulation where the extent is to the UK, even if application is only to Great Britain. I have worked with my officials to see whether or not it is appropriate to include the phrase, and the reality is that it is not considered appropriate. It is felt that it would cause complications and confusion in the drafting of the Bill.
I hope noble Lords will be assured that I have spent a great deal of time discussing these points internally. I am very comfortable, as Investment Minister—as I am sure my noble friend Lord Offord of Garvel will be in his role as Exports Minister—to continue the work that we have done to promote Northern Ireland, following on from the success of the well-supported Northern Ireland Investment Summit and the work my colleague is doing to ensure that we have a strong export market for first-class Northern Irish produce. This will benefit from our trading relationships through CPTPP.
I look upon this Bill as an enormous positive for trade in Northern Ireland. We will do everything we can at the Department for Business and Trade to make sure that traders, businesspeople, farmers and citizens of Northern Ireland can get the most benefit from it. I recommend that the technical amendments that my noble friend Lady Lawlor seeks to place in the Bill are not pressed, because I do not think they will help in the promotion of CPTPP or in the clarity of the Bill. I am very grateful for this debate at this stage of Report.
Baroness Lawlor (Con)
I am very grateful to my noble friend the Minister for his constructive approach to our discussions. Though I confess to being a bit disappointed by some of things I have heard, I am heartened by the support of your Lordships and the contribution to the debate of noble Lords today.
It is very important that we should be transparent in our laws. I welcome the CPTPP—I think it is a wonderful treaty. I would like the fact that we are moving to our own laws on business and the economy to mean that this position applies to Northern Ireland, as part of our jurisdiction and as part of the UK’s entire economic area. However, I understand that that is not the purpose of this Bill. I understand what the Minister has been advised of on the conventions. I am not happy with the conventions but I hope that we can continue to work to do what we can to make sure that Bills in this House are more transparent. On that basis, I beg leave to withdraw the amendment.
Post Office (Horizon System) Compensation Bill
Tuesday 16th January 2024
(11 months ago)
Lords ChamberRead Full debate Post Office (Horizon System) Compensation Act 2024 View all Post Office (Horizon System) Compensation Act 2024 Debates Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Committee of the whole House Amendments as at 19 December 2023 - (19 Dec 2023)
Lord Offord of Garvel
That the Bill be now read a second time.
The Parliamentary Under-Secretary of State, Department for Business and Trade and Scotland Office (Lord Offord of Garvel) (Con): My Lords, we had positive debates last week in relation to the Post Office Horizon scandal, in what proved to be a watershed moment in this appalling scandal’s story. I was pleased to be able to update the House in reply to the Oral Question from the noble Baroness, Lady Chakrabarti, and through my Urgent Question repeat.
As noble Lords are aware, last Wednesday, the Prime Minister announced that the Government will bring forward legislation to overturn the convictions of all those convicted on the basis of Post Office evidence during the Horizon scandal. We discussed this in your Lordships’ House last week and I have since written to noble Lords setting this out in more detail. The Government will continue to keep noble Lords informed as progress is made on the new legislation over the coming weeks.
The Post Office (Horizon System) Compensation Bill is a small Bill of just two clauses, which will provide a continuing legal basis for the payments of compensation to victims of this appalling scandal, specifically in this case the trail-blazing members of the group litigation order, or GLO, who took on the Post Office all the way to the High Court and exposed the Horizon scandal.
Compensation payments made under the GLO scheme are currently paid under the sole authority of successive Appropriation Acts. Parliament requires all such payments to be made within a two-year period. The first payment of interim compensation was made on 8 August 2022, meaning that with the law as it stands, no GLO payments can be made beyond 7 August 2024. This Bill removes that deadline.
Let me be clear on this point. This does not mean we are taking our foot off the gas. We still want to pay compensation as quickly as possible. My department is now committed to making an initial offer of compensation in 90% of cases within 40 working days of receiving a fully completed GLO claim, and many claims can be dealt with much more quickly.
However, as Sir Wyn Williams, chair of the independent statutory inquiry, noted, the resolution of compensation claims requires action by postmasters, their advisers and third parties, as well as the Government. In his interim report provided to Parliament in July, Sir Wyn expressed concern that the August 2024 deadline could leave some postmasters timed out of compensation or rushed into making decisions. The Government have agreed that that must not happen, and the Bill ensures that it will not happen. All GLO postmasters will get full and fair compensation; they will get it promptly, but without being unduly rushed.
Good progress has been made in paying compensation to GLO members and those in the other two compensation schemes. As of 11 January 2024, approximately £153 million had been paid to over 2,700 claimants across the three schemes. Noble Lords and the public can rightly continue to hold the Government to account on this important issue of compensation. Figures relating to the number of claims received and processed, and the compensation issued, are updated each month on the dedicated GOV.UK page.
The Government are hopeful that the announcement of an upfront offer of £75,000 that we made last week will save those affected having to go through a full assessment. This will not only allow the department to focus its resources on the larger cases but will allow the claimants’ lawyers to do the same. The pace at which we can get claims into the scheme is the key constraint on how quickly we can settle them. The upfront offer is smaller for the GLO scheme than for the overturned convictions because the claims tend to be smaller. We estimate that perhaps a third of GLO claimants may want to consider this route.
I turn now to the other pressing matter of truth and accountability. The cases of Alan Bates, Jo Hamilton, Lee Castleton, Lisa Castleton, Saman Kaur, Noel Thomas, Michael Rudkin and Pam Stubbs—to name just a few of the more than 3,000 people who have suffered in some way as a result of his appalling scandal—have been powerfully played out in the gripping ITV drama “Mr Bates vs The Post Office”. Naturally, it has drawn much greater public attention to the issue than before. I am pleased to see a much wider awareness of the scandal among the public. The Government previously set up the Post Office Horizon IT inquiry in 2020 and have provided compensation funding since 2021, but there is no question that the TV drama has brought the issue to the forefront of the nation’s attention.
For those portrayed in the drama and many others, it meant paying the Post Office money that they did not owe. For others, it meant the loss of their livelihood, home, mental or physical health, or family relationships. Too many have died before getting justice. Saddest of all, some of those deaths were suicides prompted by the scandal. Each Horizon victim is a personal tragedy. It is imperative that each and every person gets the justice and compensation that they have waited far too long for.
This Government are committed to delivering justice for all Horizon victims. Part of that justice will come from making sure that everyone knows the truth about what happened. That is why the Government set up the statutory inquiry into the scandal, chaired by Sir Wyn Williams. The work of the inquiry to date is commendable; it is doing great work in exposing that truth.
From that truth will follow corporate and individual accountability; I know that there is a strong appetite for that in this House and beyond. I sympathise with noble Lords’ desire to see accountability right now, but finding people guilty without looking at all the evidence is how we got into this mess. It is how postmasters were prosecuted without proper disclosure. We must not commit the same mistake when it comes to holding people accountable for the scandal, however tempting that might be.
In conclusion, until everyone has fair compensation, the truth is known and the guilty are held accountable, noble Lords in this House and others will rightly continue to raise issues about this scandal. I assure your Lordships’ House that this Government are on the side of the postmasters, and we will continue to give these issues our full attention and do our best to resolve them. The Bill is a further example of that, and I commend it to the House.
Baroness Chakrabarti (Lab)
I am grateful to the Minister; it is a pleasure to follow him. I am particularly grateful for the way that he dealt with matters last week, and the way that he has continued to deal with them today. I will attempt to emulate not just his tone but his succinctness; just because there is no advisory time does not mean that one has to go one way as opposed to the other way.
The noble Lord, Lord Arbuthnot, is a modest man, but I am afraid that I ask him and other noble Lords to forgive me for not sparing his blushes—not just because of his work over so many years, when these people must have felt so forgotten and ignored, but because of his very succinct but powerful contribution last week. He reminded noble Lords of the very important words of the legendary jurist and Conservative politician William Blackstone, who famously said:
“It is better that ten guilty persons escape than that one innocent suffer”.
We all know that that is from his Commentaries on the Laws of England. In those commentaries, he also said that criminal law should always be
“conformable to the dictates of truth and justice, the feelings of humanity, and the indelible rights of mankind”.
For anyone who believes that human rights were some confection from 1945, or even later in the 1960s, I remind them that William Blackstone said that not in the 1960s but the 1760s. So human rights are not some foreign body floating in our soup; they ought to be in our DNA.
In his remarks last week, the Minister very helpfully articulated the reasonable demands of the wronged postmasters. I made a note of them. The three aspects were compensation, exoneration and accountability, and the Minister repeated that formulation, to some extent, today. This Arbuthnot Bill is narrow to aid compensation, because money must be authorised. As the Minister said, it is a short and to-the-point Bill, but I say to the Government, to all noble Lords and to anyone listening to this debate or reading it subsequently, that exoneration—in my view, for what it is worth—may be achieved by a Bill that is a little longer, but not much. However, while I appreciate and agree with the Minister’s remarks that on accountability it may take a little longer to avoid the situation that he described, there must be accountability in due course. There is an element of due process, but there must be accountability none the less. That includes corporate and, potentially, individual accountability in the form of investigations—criminal investigations, potentially—as well as restitution.
We heard just this week that the management and leadership of Fujitsu are very humble, but this will not be a voluntary matter; there will have to be some legislation, I believe, to ensure corporate restitution in due course. Humility is all very well but, however big this Bill, one needs to remember the even bigger bill that the Government have met in enriching Fujitsu in relation not only to the Post Office contract but to other government contracts.
Finally, I come back to exoneration, which can be done swiftly—almost as swiftly as compensation. It is incredibly important that we do not repeat the mistakes of the Windrush scheme. There needs to be a blanket element and an automatic element to this exoneration.
I will not bore noble Lords in the short time I want to speak for with my own formulation, but it is almost as simple as declaring in primary legislation that a class of people’s convictions are hereby quashed from the moment the Bill passes, and then any application could be for a certificate of that quashing, but not for the quashing itself. That is how automatic I believe this ought to be after this length of time.
I know that some eminent lawyers, many of whom are friends of mine and many of whom I usually agree with, are nervous about this proposition. There has been much discussion, especially in the media, to suggest that somehow a proposition of that kind would interfere with judicial independence. I feel it incumbent on me to explain why I disagree with those who have made that argument, especially because some people have compared the blanket, automatic nature of the legislation I propose to the Rwanda Bill. I mention that not because I want to bang on about Rwanda as a broken record and a one-trick pony, but because it is important to make the distinction if I am to have credibility in what I propose. It is obviously not the Government’s position, but it is my position, which is important for these purposes, that the Rwanda Bill is to change facts as have been found by the highest court in the land. That is essentially what the Rwanda proposition is, whereas here, I am proposing legislation that will reflect the facts that have now been found, including by our higher courts, and implement those facts on a swift and blanket basis, to the benefit of individuals and not their detriment. That distinction is incredibly important.
As I think noble Lords and perhaps the Minister agree, this was at the very least a very gross error, involving maladministration and blind trust in technology—we must take note of that in relation to artificial intelligence, which my noble friend Lord Browne of Ladyton has been raising concerns about in your Lordships’ House, and must learn, remember and reflect on even after this particular circus has left town—and, quite possibly, systematic corruption and cover-up motivated by greed. Some noble Lords who have stopped me in the Corridor in the days since our last discussion have asked me whether I am troubled by even the remote possibility that a few postmasters who perhaps could have been correctly convicted should get off as a result of what I am proposing. I am very clear with them, and the answer lies in what the noble Lord, Lord Arbuthnot, said, and what William Blackstone said before him.
Lord Palmer of Childs Hill (LD)
My Lords, I too thank the Minister and the noble Baroness, Lady Chakrabarti, for their comments. I agree entirely with all that they said. We on these Benches support the Bill in its limited objectives. It simply provides financial power to the Secretary of State for expenditure on the compensation scheme and, as the Minister said, removes the deadline of 7 August to give people more time to claim, as recommended by the statutory inquiry. It also allows expenditure on other compensation schemes. The design of those schemes is not, unfortunately, within the remit of the Bill. We urgently need the Minister to confirm, as he suggested when he spoke earlier, that these matters will happen speedily. There is no reason to delay.
There needs to be a new rule and, following on from what the noble Baroness, Lady Chakrabarti, said, postmasters and postmistresses should be presumed innocent and all convictions, past or present, should be overturned. She used the word “exoneration” and mentioned other elements. If someone committed an offence and gets through because these convictions are quashed, that is a price that we hope will not be needed, but should be paid.
There have been lots of accusations in the Tory-controlled press seeking to make political capital out of personal disasters to postmasters and postmistresses. Let it be clear that no Minister of any party could have been expected to disbelieve the appalling—the word used by the Minister—lies and misinformation they received from senior civil servants and senior Post Office executives. There have been multiple Ministers—a long list—over this period. None of them deserves to be accused of anything other than believing the lies told to them by people they should have had the right to rely on.
The noble Baroness talked about Fujitsu. I understand that Fujitsu had always said that the only people who had access to these accounts were the postmasters and postmistresses, and therefore, if there was any error, it was the postmasters and postmistresses; it could not be Fujitsu. But we now find that at its headquarters, Fujitsu had the ability to access those accounts and to make alterations—maybe for the best of reasons and to iron out bugs—and was doing so. That is what happens with computer systems, but its interference may well have created a lot of these problems.
I practise as an FCA and had a long career as a partner in firms of chartered accountants. It would not be unusual for a client to say to me, “Monroe, we have a wonderful new system we are going to introduce for our accounting” or financials. I would look at the system and say, “Well, it looks all right”. But I would always say—and I imagine that all qualified accountants would say—that you should run the old system in tandem, in parallel with the new system for a period of six months or so, to see if there are any glitches in the new system. You have not burned all your bridges: they are still there.
The latest technology may be all singing and dancing, but you should still be looking at, in this case, keeping the paper-based system. Only when no sizeable discrepancies emerge could the old system be jettisoned, and that did not happen. This is elementary accountancy. This is not high-blown computer stuff. Can the Minister say whether senior civil servants and Post Office employees had any grounding in such mundane knowledge and experience? I believe that they may have been highly qualified, but I am of the opinion that their accountancy knowledge was pretty limited. Can the Minister confirm that in future—because we have got to look at the future now—the Government will not put all its eggs in one computer basket?
Also, since we are talking not just about the compensation Bill but the background to it, can he tell the House what auditing took place? Surely there would have been internal audits at the Post Office and at departmental level. There are audits all over the place, but do we hear anything about them? What was the role, or lack of role, of the National Audit Office? Surely we have a right to look to them as well. It is no defence from these auditors that certain bodies were outside their jurisdiction. I have had the honour to be the chairman of the audit committee of a Tory borough, the London Borough of Barnet, for eight years. The audit committee dealt with all the activities of the various departments. What we have is like a traffic-light signal—was it red, was it orange, was it green? If it was red or orange, I required the manager of each department to come to the committee and explain why there was this error, why there was this poor report, and to say what they are going to do in the future. That worked pretty well, but then there was a glitch—a glitch that is very relevant to the system which we are talking about now. The officers said, “Oh, that wasn’t our officers; we outsourced it”. In this case, in the London Borough of Barnet, it was to Capita, the computer company. Therefore, “We can’t tell you about that because Capita did it”. I said that the directors of Capita had to come to the London Borough of Barnet audit committee and explain why it was wrong and how they were going to justify it. They objected, saying, “Well, we’re not part of your organisation; we are outside”, as we are talking about in this instance. However, I insisted that they came, justified, put right and acknowledged the problems that were there.
Can we have less, please, of the party-political posturing and more of a look at how IT, without a knowledge of accountancy, can be a dangerous animal? The Minister and the noble Baroness, Lady Chakrabarti, used the words, “an appalling scandal”. It is an appalling scandal. We cannot stop it being an appalling scandal, but we must make sure that the postmasters and postmistresses are absolved, whether they might be guilty or not guilty. I am assuming that they are not guilty but, assuming even that somebody gets through who might have been guilty, I still feel that they all should be absolved because they were part of the system which was deficient at the maximum because it did not do what any basic qualified accountant would have done.
From these Benches we support this Bill, but we hope that the Minister will take aboard our comments about the future.
Lord Arbuthnot of Edrom (Con)
My Lords, I am grateful to my noble friend the Minister for his opening remarks, not least for their tone, which this House has always got right. I am also grateful to the noble Baroness, Lady Chakrabarti—except for her suggestion that this should be called the Arbuthnot Act. She made the very important point about blanket exoneration. We must not force these traumatised people back before the courts that did them such injury. I am grateful also to the noble Lord, Lord Palmer, for his important remarks about auditors, who have escaped much scrutiny. Maybe that will change in the coming weeks and months.
I declare my interest as a member of the Horizon Compensation Advisory Board. I put my name down for this debate intending to use this speech to call on the Government to announce the wholesale exoneration of all those convicted as a result of Post Office evidence since the introduction of Horizon. I thank the Prime Minister for making that unnecessary, which will shorten this speech dramatically. He has been well supported and motivated in this by the excellent Post Office Minister, Kevin Hollinrake, and his formidable team. I shall not in this Second Reading debate succumb to the temptation to travel widely beyond the contents of this Bill, which is very short. I have spent the last week trespassing far too much on people’s patience, on TV and radio and in the newspapers. I apologise for that and feel—
Lord Arbuthnot of Edrom (Con)
I feel a little talked out. That too, your Lordships will be pleased to hear, will shorten this speech dramatically.
This Bill is with us at the request of the chairman of the public inquiry to ensure that the Government do not run out of time to pay compensation or, as Alan Bates has often said, to give redress. He says that it is redress rather than compensation because this is money that the Government owe the sub-postmasters; some of it is money which has always, in law, belonged to the sub-postmasters. Let us acknowledge that point and move on.
The name of the Bill is the Post Office (Horizon System) Compensation Bill, which suggests that it is about a faulty computer system. But this dreadful story only started as a story about a faulty computer system. It became something else, as we have seen from the evidence at the public inquiry: it became a matter of human behaviour; of oppressive contracts; of Post Office investigators prioritising asset recovery over justice; of useless helplines with Post Office and Fujitsu staff telling sub-postmasters that they were the only people suffering these problems and then telling them to do things which made matters worse; of senior managers at the Post Office and possibly, although I do not know, Fujitsu, lying about what their technical staff could do by way of remote access; of Ministers of all parties failing to exercise the responsibilities of ownership; and of the courts ignoring the requirements of justice in order to accommodate the most trusted brand in the country. The background of this saga was a computer system, but compensation, as we have heard from the public inquiry, is payable in respect of so much more. So, frankly, I do not much like the name of this Bill, but having questioned its name, I shall move on to its substance.
Money is to be payable to compensate people affected by the Horizon system, or to compensate persons in respect of other matters identified in High Court judgments. The expectation at the beginning of the group litigation was that it would be split into five different cases. Because the Post Office—I assume with the backing of the Government, although we shall find that out soon—decided to spend the sub-postmasters into submission with taxpayer-funded litigation, the sub-postmasters were forced, as we saw in the drama, to settle after only two of those cases had been decided. The consequence was that many issues were left undecided. Does the Bill cover these issues?
What about issues arising out of the public inquiry, rather than out of High Court judgments? We have been listening over the past few days to some pretty dreadful stories of behaviour by the Post Office investigators, who have been confronted with their bullying behaviour. We have heard the evidence from Duncan Atkinson KC about the shortcomings of the Post Office prosecutors and their prosecutions. I hope that these issues will be covered by the Bill as well as what has come out of the High Court judgments.
I feel a bit churlish, frankly, attacking both the name and the contents of a Bill that I welcome, but I do welcome the idea that the Government should not run out of time to pay the redress that we as taxpayers—with the help of Fujitsu, now that it has recognised its moral obligation; I hope that soon it will recognise its legal obligation to contribute to the cost—owe to the sub-postmasters. The very fact that it should be necessary to have the Bill in the first place suggests that the three compensation schemes have been slow and bureaucratic —and they have been. We must get a move on and do our utmost to make sure that the Bill is not, in the event, needed, because full compensation, or redress, is paid before August.
Lord Browne of Ladyton (Lab)
My Lords, it is a privilege and an honour to follow the noble Lord, Lord Arbuthnot, particularly on the Second Reading of a Bill which, whether he likes it or not, is already referred to as the Arbuthnot Bill, and if I have anything to do with it, will continue to be.
On 7 September last year, the noble and gallant Lord, Lord Houghton of Richmond, began his contribution to an Armed Forces debate with the following sentence:
“I suppose that one of the many benefits of being a Member of this House is that you get a free copy of the New Statesman every week”.—[Official Report, 7/9/23; col. 570.]
I never thought that I would use this phrase, but I opened my New Statesman this week to discover that the editorial, headed “A very British scandal”, is about the very subject that has led to the necessity of this legislation. With your Lordships’ permission, I will read the peroration—for a very good purpose:
“The malaise that the Post Office scandal has exposed in British life is that of unaccountable power. Its executives obfuscated and denied errors despite being confronted by innumerable injustices. Institutions such as the Post Office and the Royal Mail—diminished by its botched privatisation—should exemplify the common good. All too often they become self-serving bureaucracies, with customers and workers bamboozled should they complain. Yet this affair is also a reminder of the best of public life: crusading journalists and MPs (such as staff at Computer Weekly and the Conservative peer James Arbuthnot); gifted screenwriters and actors; and, most of all, tenacious campaigners such as Mr Bates who will not cease until justice is done”.
My noble friend Lord Arbuthnot is an example of the best of public life.
The Post Office Horizon scandal exemplified many of the trends that have led to anger and political apathy among the public. Political indifference and delay, exacerbated by a defensive posture among the legal profession and others, have resulted in ruinous, life-altering outcomes for thousands of innocent people. To add insult to considerable injury, Fujitsu—the company responsible for this debacle—has won 150 government contracts since the details of the Post Office scandal began to emerge. Since December 2019, when the Appeal Court ruled that the Horizon system contained bugs and errors that resulted in miscarriages of justice, the Government have awarded contracts worth more than £4 billion either solely to Fujitsu or as part of joint public sector contracts. For those affected, there could be no greater evidence of a thumb on the scales of justice than this asymmetry of consequences. Postmasters have faced financial hardship and ongoing legal limbo, while those responsible have received implicit government endorsement in the shape of new lucrative contracts.
This is bad enough, but recent evidence has suggested that the Post Office has also treated the limited compensation it grudgingly offered to sub-postmasters as tax deductible. Dan Neidle, the head of Tax Policy Associates, has outlined why these claims are illegitimate, stating that you cannot
“claim a tax deduction for things which are unlawful, illegal or outside the trade”,
such as wrongly prosecuting 4,000 postmasters. We must also ask why, given that the £934 million they claim as deductible relates to historic periods, it is only this year that the Post Office has made a designedly oblique reference to this practice in the small print of page 101 of its accounts. I am pleased that HMRC last week confirmed that this matter—one of five where Tax Policy Associates believes that the Post Office has materially underpaid its tax—is under active investigation.
Mr Neidle is also campaigning openly for better compensation in the present scheme, for the element of damage that reflects destruction of reputation and stress. As I heard him explain only the other day, in the context of employment tribunal awards that component of the calculus of the total sum of compensation attracts awards of between £1,000 and £11,000 for the lowest levels of damage to reputation and emotional damage. For the more severe, awards are between £11,000 and £34,000. For the worst examples—I venture to suggest that the vast majority, if not all, the wronged postmasters must have suffered reputational damage and stress of the worst kind—employment tribunals are awarding between £34,000 and £56,000, whereas most postmasters are getting no more than £5,000 from the current compensation scheme.
Alongside today’s Bill, I am also pleased that a brief Act of Parliament providing for exoneration of all those affected is now being considered, which is something I first suggested in your Lordships’ House in June 2020. Given that three and a half years have elapsed between that date and this, such a glacial pace in providing redress may be another useful exemplification of a problem that saps confidence in the political process among the public.
At the heart of this miscarriage of justice is the fundamental unreliability of the Horizon software, upon which the original prosecutions depended. It is equally clear that, without the group litigation brought by the 555 sub-postmasters, the flaws and glitches in the software would not have been uncovered. Here, I return to a question which I raised in your Lordships’ House last Wednesday: where does, and where should, the burden of proof lie in respect of computer-derived evidence? The Police and Criminal Evidence Act 1984 placed that burden upon those who rely on such evidence. But, in response to lobbying from the Post Office, among others, we saw that change, because of a Law Commission recommendation. There is now a presumption in favour of the reliability of such evidence unless a defendant can prove why it may be compromised. How can we possibly expect an individual unversed in the complexities of computer programming or algorithmic, sequential decision-making to provide such proof? This is a further asymmetry that needs urgent action. I would be grateful if the Minister could give an undertaking, maybe not today, that this will form part of the follow-up to the Williams review.
Finally, I turn to the broader issue that my noble friend Lady Chakrabarti alluded to, and which is an obsession of mine: artificial intelligence and its integration into our public services. If the Horizon system—far more rudimentary than any AI-infused technology—can precipitate such confusion, misery and frustration, there is a risk that a far more complex system could produce more apparently coherent, though equally unjust, outcomes. In such a case, the pursuit of justice in the case of error would be more tortuous than that endured by the sub-postmasters we are discussing today. Noble Lords may recall a scandal that hit the Netherlands in 2019, whereby a self-learning algorithm falsely labelled thousands of people in receipt of child benefit as perpetrators of fraud. What was the result of that? Poverty, a wave of suicides among those affected, and children taken into foster care. Perhaps most worryingly, the algorithm disproportionately—and, to reiterate, falsely—targeted those from ethnic minorities.
I realise this is well outside the Minister’s purview, but, as we learn lessons from the Horizon scandal, what plans do the Government have to review the integration of AI into the work of the DWP in this country? Perhaps more importantly—I have asked this question and it has not yet been answered—what is the statutory basis for the use of AI in public services at all? Surely the use of AI in this way risks violating the Blackstone principle, of which the noble Lord, Lord Arbuthnot, reminded your Lordships last week. I will not repeat it, because my noble friend has already dealt with this. In this respect, I return to the Dutch case to which I referred. The victims had no way of knowing why their cases had been identified as potentially fraudulent, and officials claimed they had no way of accessing the algorithmic inputs and could therefore not describe why they were under suspicion. This echoes the Kafkaesque nightmare of the sub-postmasters—accused by faulty technology, denied access to the very information that could exonerate them and forced, in the meantime, to endure penury and stigmatisation.
I will support this Bill, as my party will, as it passes your Lordships’ House with, I trust, the utmost rapidity. I keenly anticipate further measures, not merely to provide full restitution to those affected by the Horizon scandal but to strengthen scrutiny and ministerial oversight over arm’s-length agencies. Nothing adequately can compensate the sub-postmasters and sub-postmistresses who have lost years of their lives to this injustice, but I believe that ensuring such a tragedy cannot happen again may at least console them with the thought that their suffering has not been entirely in vain.
Baroness Jones of Moulsecoomb (GP)
My Lords, this Bill is welcome because we needed to see some action from the Government. It is very good, but of course there are a lot of questions that remain to be answered. I am curious about how many of these will get an answer over the next few years.
Where did the sub-postmasters’ money go? Did it pay for the bonuses of those who prosecuted them? Did Fujitsu ever get fined or even suffer any consequences for the failures of the Horizon system? Is it going to suffer in the future? At the moment, the taxpayer is covering the cost of the government redress scheme, but when do we get some of that money back from the people who made a profit or claimed a bonus as a result of destroying the lives of thousands of sub-postmasters?
What are the lessons we should learn, not just from this horrendous injustice but from the common themes of numerous modern scandals? We have had Hillsborough, which turned victims into pariahs as the establishment closed ranks. There was the “spy cops” scandal, with its denial of systematic abuse and cover-up, and the institutional racism of the Windrush scandal, which has its echoes in the racial profiling of sub-postmasters. All these are examples of how the establishment closes ranks and blocks progress. There is no recognition of how our democracy is failing to deliver for ordinary people.
There are so many awful things about the scandal of how the Post Office treated its sub-postmasters: the lies and threats used to isolate people and make them feel alone; the vicious use of courts to silence complaints about a flawed computer system; a system of corporate bonuses designed to encourage malicious acts against innocent people; and, of course, legal teams and professionals who lost their moral compass. This is David versus Goliath: a Goliath that was a private corporation, backed by the state and able to destroy people’s lives one by one. At least 236 sub-postmasters were sent to prison for offences they did not commit. Many have died poor and some committed suicide. Over 3,000 had their names dragged through the mud.
It is absolutely incredible that the sub-postmasters have had the resilience to get together and win. I am in awe of their tenacity and their patience—except, of course, they have not won yet. In the last decade, they have been deceived and messed around with previous compensation schemes. Fujitsu remains a favoured government contractor. In fact, it has won nearly 200 public sector contracts worth nearly £7 billion. When the sub-postmasters are cleared and their names are removed from the criminal records database, guess who has the contract to do that? Fujitsu. Is it, perhaps, too big to fail? Is it considered irreplaceable, or are there other reasons for continuing to use it?
It was the Post Office that relentlessly persecuted the sub-postmasters, but Fujitsu provided the expert witnesses in court to declare that it was the “Fort Knox” of software. It effectively pointed the blame at the sub-postmasters and away from the company, yet it now acknowledges that there were bugs and errors right from the start. Why, then, has Fujitsu been involved in £4.9 billion of solo and joint public sector contracts after the December 2019 ruling, including £3.6 billion during Sunak’s time as Chancellor and now Prime Minister?
Is it the close ties with Conservative Party donors, such as Simon Blagden, who stepped down as non-executive director at Fujitsu UK in 2019? He was a man who, along with companies he is associated with, has donated £376,000 to the Tories since 2005. Or the 2019 donation by Fujitsu Services Ltd of £14,000—peanuts, really—or the £21,000 to the Conservatives to run the Blue Room at their conference in 2015?
I am now going to offer some solutions, because I do not like to criticise without coming up with something positive to say afterwards. I suggest that the Government now take three immediate steps. They should hand back donations from those linked with Fujitsu. That is a role for the Conservative Party. They should have a moratorium on Fujitsu public sector contracts until the public inquiry reports. There should be a pause in using Fujitsu until we understand exactly what it did. They should pay the redress money as soon as possible, but get back as much from Fujitsu as possible. I see no reason why the taxpayer should carry the burden of most of the redress money. I would really like to point out that there are more questions raised now than answered. It would look very good from the Government’s point of view if they could, perhaps, answer some of those questions before the public inquiry does.
Lord Forsyth of Drumlean (Con)
My Lords, I thought for a dreadful moment that I was going to say, “I agree with everything the noble Baroness said”, but she spoiled it with her party-political points at the end. She will forgive me if I do not pick up on them, but what she had to say about what has happened is something all of us feel very deeply.
I have been around Parliament for close on 40 years, and I do not think I have ever felt so ashamed of so many things that have gone wrong, with devastating consequences. The Bill is about compensation. I do not know how you compensate people for losing some of the best years of their lives. I do not know how you compensate people for the horror that they have faced of having to live from hand to mouth. All I know is that something has gone dreadfully wrong with our system when it took my noble friend, who is a hero although he denies it, and Kevan Jones in the other place for the Labour Party, more than 20 years. This has gone on for more than 20 years, and even now we have a Bill to extend the time still further. I am not against the Bill. I can see that in practical terms it is necessary, and I am grateful to my noble friend the Minister for saying that the Government are not going to take their foot off the gas. I have to say that the foot has not really been on the gas for quite some time.
My noble friend the Minister said that this is a small Bill; I think we are going to have a very big bill at the end of this process—I am referring not to legislation here, but to cash. I was delighted to see Fujitsu today, speaking from Davos—the irony—admitting moral responsibility. There is a legal responsibility as well.
I want to say a few things to my noble friend about some of the reasons that I say that this is much wider. What was the board of the Post Office doing? Did nobody on the board of the Post Office think, “Isn’t it a bit odd that we are suddenly getting all these cases?” Where were they? What has the department done to hold the board to account? Are there malice and clawback provisions—which are common throughout business nowadays—that apply to the Post Office? Are they being applied? I am sorry, but it is not good enough for Ministers to say, “We are waiting on the results of the public inquiry”. It is not the public inquiry’s responsibility to hold the members of the board of the Post Office responsible for discharging their fiduciary duties. That is for Ministers to do. I am at a loss to understand this. Look at what has happened to some of the people on the board of the Post Office: one of them is now a Permanent Secretary in a government department. I am not saying that she did anything wrong, but I just find it completely remarkable, so can my noble friend tell me what action has been taken by Ministers to look at the conduct of the members of the board? Did they not read the newspapers? Did no one think, “Isn’t it odd that we’re having all these sudden cases of alleged fraud and dishonesty coming from nowhere?”
Then we have Fujitsu. I read in the newspapers—to follow the point made by the noble Baroness, Lady Jones —that when Ministers wanted to take action to stop Fujitsu getting contracts, they were told that poor performance in respect of one contract did not enable you to not have some of the others. What is this world that operates in Whitehall? Every household in the country, if it gets a duff builder, does not feel that it has to give that builder another opportunity, so there is something desperately wrong with the procurement process and the way in which Ministers are advised.
Now I would like to say something at risk to myself: I would like to criticise the Lobby correspondents in this place. My noble friend has raised this on numerous occasions, and we have all tried to support him in one way or another. It gets nowhere. It does not get reported. Then we have a television programme and now my noble friend is full-time doing interviews and explaining what has happened, but for years and years it was not of interest, like so many reports produced by Select Committees of this House which warn—I will not go through the whole litany of them—and they do not get picked up because the Lobby correspondents are too busy as a pack operating on how many bottles of champagne have been sold in the House of Lords, for example, which hit the headlines the other day, completely wrongly attributing it to Members and not to people who come here.
I am not a lawyer, but I always understood that lawyers had a duty to the courts and to ensure that information was disclosed, whether in court cases or tribunal cases. So what was going on with the lawyers? What was happening there? Is the regulatory body waiting for the inquiry as well? The inquiry will report and then there will be another couple of years—by which time we will all be dead—before we know what actually happened. Why are the regulatory bodies not doing this?
On the subject of the Lobby, why is it that Computer Weekly has been the hero here? Our paths crossed, my noble friend and I, after Liam Fox, when he was Secretary of State for Defence, set up an inquiry to look into the Chinook helicopter crash on the Mull of Kintyre. I did this with a judge, and with the noble Baroness, Lady Liddell. We exonerated the pilots. Quite frankly, when we looked at the evidence, there was a whole load of information that had not been made available to Ministers. I see a pattern.
I concluded that a whole bunch of important people concerned with security in Northern Ireland had all gone on one helicopter, which they should not have done. The helicopter had not been approved to fly safely; indeed, there was evidence that it had been thought that it would be positively dangerous. The easy thing to do was just to blame the pilots. The case took 11 years. My noble friend, again, was one of the heroes pursuing that issue. While the families battled to get clarity, some of them died, as has happened with the postmasters. There is something fundamentally wrong with the way we operate when these scandals occur.
I congratulate my noble friend on his persistence. In the film, someone says, “I never thought a Tory MP could be so nice”, or something to that effect. Just for the record, whether they are Tory or Labour MPs, or even Liberals, or Liberal Democrats—are there any Green MPs?—whatever they are, the vast majority of Members of Parliament, in my experience, do their duty by their constituents and work very hard; there are some bad apples, of course. But if we get answers from Ministers that do not answer questions, if Parliament is not able to do its job because the Executive has become overmighty and too powerful, they cannot deliver. The result, of course, is a scandal of this type.
Having got that off my chest, I want to ask my noble friend the Minister one question. This concerns one individual, Lee Castleton; I know about this only because of the media coverage. We know, because the Post Office has admitted it, that Lee Castleton was used “pour encourager les autres”. He defended himself in court, he got a bill for over £300,000 and he was bankrupted. Will those legal costs be remitted to him? Will he be compensated for all the legal costs?
When, greatly to their credit, the Prime Minister and other Ministers say that people will be restored to the position they would have been in had this not happened—wow—what does that mean, and who will decide that? It does not mean just compensation in terms of some approved scale or whatever. What about what happened to their homes and house prices and everything else? When we talk about compensation, what are we actually saying here? How will this be delivered, and in a realistic timescale? We are all getting older, and they have had to wait far too long.
Finally, I want to ask my noble friend, although I know that he does not have responsibility for it, what is going on in Scotland in this respect? I read in the newspapers that, in Scotland, they are talking about providing a pardon. I am sorry but, if I am a postmaster who has been falsely accused, I do not want a pardon. I want absolutely it on the record that I have been exonerated. A pardon is not enough. I appreciate the legal difficulties but it is not enough, and you cannot have a different system north and south of the border when you are talking about restoring people’s integrity and reputation.
I apologise to the House for going on for so long at this hour. I had hoped to do it on Thursday when we talked about accountability, but we were given three minutes, and now I can talk for as long as I like. But I might lose the House if I did so.
There are some serious issues here about accountability and about the relationship between the Executive and Parliament. This needs to change. There is going to be a general election. It will be interesting to see what the parties say in their manifestos about dealing with this. We all know on all sides of this House that Parliament is broken and not working properly. We know that because we get all the legislation that comes here from the other place that is not being properly discussed. We know that because we get Answers from Ministers to Written Questions and Oral Questions which have been written by civil servants who do not show sufficient respect to Parliament, and Ministers—perhaps some—who do not respect Parliament to the degree they should. When that happens, it means that people have to battle for 20 years. I pay tribute to my noble friend, who—he really needs to shed his modesty—is a symbol of what is good about this place. This whole episode has revealed a very rotten undercurrent, which needs to be addressed.
Baroness Hoey (Non-Afl)
My Lords, it is a huge pleasure to follow the noble Lord, who has probably spoken for those people watching and listening tonight. What he is saying is that there needs to be a real, deep-rooted look at how we work generally within Government and in Parliament, and particularly with the civil servants. I agree so much about the Post Office board.
I thank the Minister for his very sincere and clear outline of the Bill. It is rare on a Second Reading to get so much agreement between everyone. One or two things I would not necessarily agree with, but most of what has been said tonight I absolutely agree with. This is the first time for a little while that I have seen a Bill that actually includes Northern Ireland. I thank the Government for this because of course dozens of people went to prison in Northern Ireland too. I am very pleased about that.
The Bill is about compensation, but the reality, as has been said by other noble Lords, is that no amount of money will bring those people who took their own lives back to their families, no amount of money will replace the time that people spent in prison, and no amount of money will help take away that terrible trauma we know those men and women felt when they knew that their local community—which they had loved, trusted and worked with—was looking at them in a different way, because there was always this idea that there was no smoke without fire. The point raised by the noble Baroness, Lady Chakrabarti, and her explanation of exoneration is so important. It is not just about compensation. Money cannot replace all of those things. However, of course it is important that we deal with that quickly, and that is why it is good also that the time limit is being extended if necessary.
I want to say a few words about Fujitsu. I find it shocking that today we saw Fujitsu’s European boss, Paul Patterson, tell MPs, as has already been mentioned:
“We were involved from the very start. We did have bugs and errors in the system and we did help the Post Office in their prosecutions of the sub-postmasters and for that we are truly sorry”.
Fujitsu’s website says:
“For over 40 years, Fujitsu has been a trusted provider to the public sector through the delivery of nationally critical services”.
I say to the Government that it is inexplicable to me that they could continue to give contracts at this stage to that company. Paul Patterson also said today, “We all make mistakes”, but the reality is that Fujitsu lied. That is not making a mistake.
On the moral obligation to contribute to the compensation scheme that has been mentioned, we have to be clear that Fujitsu is going to be made to pay huge amounts of money. As the noble Baroness said, it should not be the taxpayer picking up the tab; it should come from those who were at fault.
I am sorry if it seems as though I always come back to Northern Ireland, but Fujitsu has the contract for the Trader Support Service. I got an answer to my Question about how much it has been paid. It is a Fujitsu-led consortium and it is very expensive: so far, from August 2020 to August 2023, it has spent £411.6 million on the scheme. Apparently, Fujitsu suggested when it got the contract that it had the capacity to make the Irish Sea border work smoothly, and that is why it got all this public money.
However, hauliers are already saying that despite getting this huge amount of government money, Fujitsu is not providing a smooth service. The wonderful technology that it went on about is still struggling to deal with things such as mixed loads going across and the whole way that groupage works. We need to ask why Fujitsu was given that contract, why it cannot now have that contract removed, whether it can deliver and whether it has been overpaid. If the Government were simply to restore Article 6, that money could be given to many of the people who have suffered under the Horizon scheme and under the overall control of Fujitsu.
Tonight is important because we are moving on. I welcome that things have moved so quickly in the last short while. I add my tribute to all noble Lords who have been talking about this and trying to do something about it for many years, particularly the noble Lord, Lord Arbuthnot. I hope that we can now work out the compensation, but accountability is the crucial bit. We cannot let these people get away with this. We cannot let them continue to think that they can simply go back to people who complain about anything to do with the public sector and tell them that they know best and technology knows best.
I welcome this measure. I am glad that we have been able, finally, to move it forward as quickly as we can.
Lord Cormack (Con)
I am glad to follow the noble Baroness, not least because I agree so passionately with what she and others have said about my noble friend Lord Arbuthnot. He has been exemplary in the way that he has behaved. He has been persistent, tenacious and, in the end, successful, but it has taken far too long.
Something that puzzles me is that those of us who have represented constituencies in the other place, particularly if they were rural ones—I had a significant number of post offices in my constituency—know that in almost every village the postmaster or postmistress was looked up to as one of the leaders of the community. For the life of me, I do not know how the Post Office or anyone else could have thought that these people who had done so much for their communities—provided local leadership, run the flower shows and all the rest of it—suddenly, all over the country, had turned bad and become criminals. It is just implausible. If it were in a novel by the noble Lord, Lord Archer, no one would believe it. It is incredible that this has happened.
I want to make one or two points. First, this Bill, which has my wholehearted and complete support, is a misnomer: there is no such thing as compensation—others have touched on this—for the destruction of lives and livelihoods, for deaths; there is no way that you could adequately compensate for those things. Of course, they must have decent and proper payments, and they must have them as quickly as possible. I believe the Government should absolutely commit themselves to making these payments by August. August is referred to in the Bill, and I ask that my noble friend the Minister do everything he possibly can—I know he cannot give a total commitment to your Lordships’ House tonight—to ensure that the Secretary of State and the Government sign up to an August deadline because this must not go on and on and on.
I also agree wholeheartedly with the need for doing more, and what was proposed in the other place last week has my broad and enthusiastic support. But we do have to recognise the constitutional implications of Parliament passing an Act that, at a stroke, overturns judgments in dozens, if not hundreds, of court cases. It is very important that we recognise—I am very glad to see the noble Lord, Lord Hunt, nodding at that point—the constitutional implications of what we are doing, and in recognising them, we need to commit ourselves to say that this will never be necessary again. As to how we do it, it must be in consultation with the judiciary, and various things spring to mind: a decent budget for the Criminal Cases Review Commission might be one of a number of ways we could contemplate doing it. We must not put ourselves in the position again where Parliament can undo, at a stroke, what the independent courts of this land have determined. I beg noble Lords not to think that I am, in any way, seeking to oppose what is proposed, but I think we need to understand the implications of it very carefully; it is incumbent on all of us to do that.
I thought that the noble Lord, Lord Browne of Ladyton, made a very important point about artificial intelligence. I cannot pretend to be an expert on these subjects—I think everybody in the House knows that—but I am very worried about the manipulation of artificial intelligence. I am very worried, with the general election approaching, about the consequences for the future of our democracy. It is possible to recreate the voice of the noble Lord, Lord Hunt of Kings Heath, and my own voice, and to put words into our mouths that advocate things we would never in a million years advocate and, what is even worse, to have people taking those things seriously—we do have to recognise this. And that is why the noble Baroness, Lady Hoey, was right to talk about the responsibility of Fujitsu. I cannot anticipate the results of various inquiries, but it does seem that it has a lot to answer for. I was horrified by the figure of £411 million that the noble Baroness quoted in a more recent context; it has a lot to answer for, and I believe it should have a lot to pay for as well. I think that is absolutely fundamental.
I agree wholeheartedly with the Blackstone dictum, which I have quoted in your Lordships’ House in other contexts: far better that 10 or a dozen rogues go free than that an innocent man or woman is punished. But we have to recognise that this is not the only scandal. I suppose we really ought to urge ITV to do a series on the contaminated blood scandal and on Windrush. This is one of a number, although I believe it to be the worst, in both numbers and content—but it is not the only one. We in this House, and our colleagues in the other place, have an absolute duty to do all we can to ensure that these scandals are not replicated.
We will have a far better chance of doing that if we remember the words of the late Lord Judge: if we have legislation that is properly thought out, if we abandon the Henry VIII clauses and the Christmas tree bills, and if we recognise above all else that the Executive is answerable to Parliament, not the other way round.
Lord Sikka (Lab)
My Lords, it is a rare occasion on which I agree with everything that has been said. No amount of compensation can compensate these people for the pain they have suffered—not only them but also their families and friends. I have a number of questions for the Minister, and I will take this opportunity to put on the record some other matters that will hopefully be helpful for later debates.
First, can the Minister confirm that there will be no upper limit on the amount of compensation?
Secondly, paragraph 14 in the Explanatory Notes states that the scheme will be
“administered by the Post Office”.
Why? Who on earth could have any confidence in it being fair? Surely the entire board needs to be sacked and a new board needs to handle this, or an independent body needs to be created. I do not think many people will have any confidence in the current board’s ability to handle this matter in a fair way.
Thirdly, there are press reports—the Minister may have seen them—that one postmaster got compensation of £15.75. Could he look into this please? I have looked at the 14-page form that this sub-postmaster filled in, and I would not like to complete it. It effectively asks them to give up their rights for any future claim. That is utterly inappropriate, and it is another reason why the Post Office is not a suitable body to handle the compensation claims. I hope the Minister will attend to that as a matter of urgency.
A number of comments have been made about accountability, and directors and auditors have been mentioned. I will put some matters on the record in relation to that. I checked the Companies House filings today and, between 2002 and 2023, there were 83 directors of the Post Office. Despite full inside knowledge, not one of them went on the public record to say that something was wrong. They were complicit, they lied and they committed fraud—83 of them.
The Post Office also had several non-executive directors, who are supposed to challenge what the executive board does. None ever spoke up, despite some also being heads of the audit committee and the risk management committee. There has been a conspiracy of silence, injustice and fraud, and they all need to be held to account.
Noble Lords asked what on earth happened to the money extracted from sub-postmasters under fraudulent pretences. It may interest them to note the Second Sight report from 2015, paragraphs 22.11 and 22.12 of which say that
“for most of the past five years, substantial credits have been made to Post Office’s Profit and Loss Account as a result of unreconciled balances held by Post Office in its Suspense Account … It is, in our view, probable that some of those entries should have been re-credited to branches to offset losses previously charged”.
That was in 2015. The Post Office did not do so. Directors on performance-related pay were very keen to boost the bottom line; they directly benefited from this fraud. They all knew for years that something was wrong but continued in exactly the same way.
There were also violations of the Companies Act 2006 requirements by directors of the Post Office. For example, Section 386 requires directors to keep “adequate accounting records”. In view of the flaws of the Horizon system, it must be doubted that the company did so. Failure to keep adequate accounting records is a criminal offence, so what exactly have the Government been waiting for? Why have they not charged anyone? Is it because we do not have a central enforcer of company law in this country? We are almost unique in the western world in that respect.
Section 172 requires directors to
“act … in good faith … promote the success of the company for the benefit of its members as a whole, and in doing so have regard … to … the interests of … employees … suppliers, customers … the community”
and have
“high standards of business conduct”.
Anyone looking at the 300 pages of the High Court judgment would conclude that the directors totally failed to do that. Unfortunately, we do not have an enforcer of company law, so the onus is on the Government to act. What action has been and will be taken? I have no confidence in the Insolvency Service being able to do anything—we would be waiting another 10 years.
I turn to auditors. Ernst & Young was the external auditor of the Post Office from 1986 to 2018—the entire period of the scandal. As part of their statutory duties, an auditor is required to state whether in their opinion
“adequate accounting records have not been kept, or … returns adequate for their audit have not been received from branches not visited”.
The company did not keep proper accounting records, as I said earlier. Despite the overwhelming evidence to the contrary, Ernst & Young said that it was satisfied—how could it not be, having picked up £1.8 million in fees in the previous two years? Was it all to do with money? This is not the first time we have talked about the role of auditors; there are numerous scandals, and I have published a lot of academic and other research on them.
Ernst & Young knew that the accounting system was deficient. That much is clear from a publicly available, 36-page Post Office report titled Horizon—Response to Challenges Regarding Systems Integrity, dated 2 August 2010. It was written by a gentleman called Rod Ismay, the head of product and branch accounting at the Post Office. He joined the Post Office in 2006, after 11 years working for—guess who?—Ernst & Young, and was now liaising with the auditor. The report is very concerned about the court cases and adverse press reports. I first became aware of this scandal in 2009 from an item in an accountancy magazine, and I have followed it and noted with considerable dismay that nobody actually honed in on auditors or corporate governance. It was all about the systems and everything else.
On page 19 of the report, there is a paragraph that we need to take note of:
“Ernst & Young and Deloitte”
—it has been involved in some capacity—
“are both aware of the issue from the media and we have discussed the pros and cons of reports with them. Both would propose significant caveats and would have limits on their ability to stand in court, therefore we have not pursued this further. The external audit that E&Y perform does include tests of”
Post Office Limited’s
“IT and finance control environment but the audit scope and materiality mean that E&Y would not give a specific opinion on the systems from this”.
Another paragraph is most damning:
“It is also important to be crystal clear about any review if one were commissioned—any investigation would need to be disclosed in court. Although we would be doing the review to comfort others, any perception that POL doubts its own system would mean that all criminal prosecutions would have to be stayed. It would also beg a question for the Court of Appeal over past prosecutions and imprisonments”.
That is an internal document—a report of the Post Office—which is publicly available, and auditors have discussed all of this.
The point is that Ernst & Young had considerable awareness of the issues, systems and internal failures. On 27 March 2011, it wrote to the management of the Post Office. I will read two paragraphs from that letter:
“The outsourcing of Post Office Limited’s … IT function to a third party … provider (Fujitsu) creates a degree of complexity and difficulty for POL in gaining assurance that”
these
“are adequate … We noted that POL are not usually involved in testing fixes or maintenance changes to the in-scope applications; we were unable to identify an internal control with the third party service provider to authorise fixes and maintenance changes prior to development for the in-scope applications”.
It knows that Fujitsu is pulling the strings, having unauthorised access to anything and everything. None of this ever gets mentioned in the accounts and the audit report—none. That is the state of audit that we have in this country.
Ernst & Young knew the failures of the system and the cover-up. It knew that the company did not keep adequate accounting records, and adequate returns were not received from branches not visited by it. Post Office profits were inflated by the amounts fraudulently taken from postmasters.
I have questions. I taught auditing for many years as an accounting academic. The first thing you teach students is that if management asserts something, you try to independently corroborate it; the more that you are able to corroborate something, the more confidence you can have in it. How on earth did Ernst & Young corroborate what the management told it, or did they simply rely upon it? How did it verify income and profits, with millions, possibly—I do not know how much—in loss of money given by innocent sub-postmasters and simply taken by the Post Office?
E&Y knew the Post Office had suspense accounts. The existence of prolonged suspense accounts is an indication of accounting misstatements and possibly fraud—I am sure the noble Lord, Lord Palmer, would agree with that. It should have been put upon inquiry that something was wrong. That went on for years and years. How did Ernst & Young test any corporate reconciliation of those suspense accounts? How was it persuaded to believe that no provisions needed to be made for any contingent liabilities, given that it had access to all the press clippings and everything?
There is an issue. Every year, Ernst & Young gave the company its customary clean bill of health and, as I indicated, in the final two years it collected £1.8 million in fees. As a sole shareholder of the Post Office, the Government need to sue Ernst & Young, because it owed a duty of care to the company at the very least —if not to anybody else. It has been utterly negligent and a party to a cover-up. The Government need to have the Ernst & Young audit investigated from 1999 onwards—not just one year, the whole period. What exactly was it doing? I hope that the Minister will say, “Yes, that will begin tomorrow, next week or next month”, because we need to be very firm on this.
Finally, I fully support the Bill and I await further Bills to reform corporate governance and auditing.
Lord Weir of Ballyholme (DUP)
My Lords, I enthusiastically support this legislation, which has received support from every corner of this House—even from the sober representation of the Democratic Unionists. I suspect that we are not responsible for very many of the bottles of champagne that the noble Lord, Lord Forsyth, made reference to earlier.
This issue has deep personal resonance for me. I come from a Post Office family. My mother worked for many years for the Post Office. My father worked his entire adult life for the Post Office until his retirement in 1987. I shudder to think what either of them would have made of this appalling scandal. In the 1970s, my father spent a good deal of his time working alongside virtually every sub-postmaster and sub-postmistress in Northern Ireland, helping them to fit what were referred to as “bandit screens”—a euphemism for a form of protection used to try to protect post offices from robbery. That should give us pause for thought.
The noble Lord, Lord Cormack, highlighted that the sub-postmasters and sub-postmistresses are the backbone of our communities and the glue that holds them together, but we should also remember that the service and self-sacrifice they give to the community have often come at deep personal risk. Post offices were quite often targeted as the easiest and most vulnerable target of organised crime, terrorism and local villainy whenever robberies were being pursued. Those are the people at the heart of the scandal before us.
It is right that this legislation is just one piece of the jigsaw. It is important that the inquiry deals with accountability at both an organisational and an individual level. It is clear that there has been negligence, deceit and maybe even criminal behaviour on the part of some of those individuals and organisations, and it is right that we hold those people to account through the due process of law. It is also the case that the focus needs to go beyond accountability and that the inquiry should deal with many of the systematic issues that have been highlighted in this debate and beyond: the future role of AI, the shift in the burden of proof when it comes to the reliability of computer evidence, and the question of which organisations should have the power to take criminal prosecutions. All those issues need to be taken into account, and many more.
It is right that we focus today on what may be euphemistically called compensation for sub-postmasters and sub-postmistresses who have been affected. The contents of the Bill are of great merit: it is right that the Minister is given the power to compensate and, indeed, that the scope is wide enough to cover all those who have been directly affected.
I welcome the removal of what I think is an artificial date: the restriction of compensation ending, in effect, in August 2024. I also welcome the Minister’s commitment that the foot will not be taken off the pedal in relation to this.
It is also vital, as has been highlighted by the noble Baroness, Lady Hoey, and others, that this covers sub-postmasters and sub-postmistresses in England, Scotland, Wales and Northern Ireland. The Post Office is a unitary body, effectively, throughout the United Kingdom. Whether it is in the inner-city branch or the most rural of settings, tasks, performance and terrible things have happened throughout this kingdom, so it is right that everybody is put on a level playing field.
To that extent, the Government need to look at the scope of exoneration. It is clear that the Government are rightly determined to ensure exoneration throughout the system, but, when questioned on this last week, they highlighted initially that the legislation was focused on England and Wales. But we know that in Scotland and Northern Ireland, there have been 100 prosecutions, I think: 76 in Scotland and 24 in Northern Ireland. I appreciate that the Government have committed to consulting with the relevant bodies in both those jurisdictions to take matters forward. But I say to the Government that, if we are left with a process that, at best, becomes unnecessary duplication of legislation in other jurisdictions to achieve the same effect or at worst, as highlighted by the noble Lord, Lord Forsyth, an inadequate pardon, which becomes a form of second-class solution, that is inadequate. It is worse still if we leave some of those sub-postmasters and postmistresses in a situation in which justice and exoneration for them comes with a level of unnecessary delay because of that duplication. That would be unacceptable.
I appreciate that there are legal barriers as to why this is difficult to do, but I urge the Government to take every action they can to think outside the box to ensure that we have legislation which covers every sub-postmaster and sub-postmistress who has been affected throughout the United Kingdom. That is the fair solution, as we have with this legislation.
Many years ago, there was a slogan used in Northern Ireland in an election campaign. I cannot remember which particular election it referred to, or even what it directly sought to overturn, but the slogan was “To put right a great wrong”. We all know within this House that whatever we do cannot completely put right what has happened in terms of the wrong that has been done to the victims of the scandal. For some, it is sadly too late. Some have taken their own lives; others, through the passage of time, have passed away; and for any sub-postmaster or sub-postmistress who has been impacted by this, irrespective of the level of compensation, if you gave them the choice of all the compensation in the world or turning the clock back and making sure that this never happened to them, they would choose the latter. We cannot completely put things right. But today at least, and I think with a unanimous voice, we can take a large step in the right direction by passing this Bill.
Baroness Brinton (LD)
My Lords, we have had an extraordinary debate on compensation, exoneration and accountability, but this very short, two-clause paving legislation to grant the power to incur expenditure in relation to compensation for the victims—the postmasters and postmistresses—is absolutely vital. However, the detail that we have been discussing is not in this Bill. For the short term, the actual scheme for this particular compensation package is something that I hope the Government will take notice of. But there is time for politicians of all parties to review the entire nature of compensation schemes and the way they work. This is just one of many schemes that have gone wrong in the administration, and we must look at that.
We were reminded by the noble Baroness, Lady Chakrabarti, of the repeated abuse of the human rights of the postmasters in this whole process over the years. They were let down by organisation after organisation. We must have the postmasters at the heart of any debate that we have about this. It is an appalling miscarriage of justice. We were reminded of the personal sacrifice of many postmasters by the noble Lord, Lord Weir, and the risks that they face before they have to start looking at their accounting packages—but worse is that they are still waiting for justice and many, as we have heard, are waiting to receive compensation or redress.
My noble friend Lord Palmer talked about the presumption of innocence, and that must be essential for getting to exoneration. The postmasters, led by the absolutely admirable Alan Bates—who is as modest as the noble Lord, Lord Arbuthnot—have fought for decades to get to the truth of what happened and to clear their names. The noble Lord, Lord Forsyth, referred to lobby correspondents and other media, but there have been some extraordinary journalists over the years. He referred to Rebecca Thomson and Karl Flinders of Computer Weekly, but Private Eye has covered this story for decades, as has Nick Wallis at the BBC, and John Sweeney’s “Panorama” in 2015 was done at an absolutely key time.
All of that happened before Paula Vennells was even the chief executive of the Post Office. I am very grateful for the comments that the noble Lord, Lord Forsyth, made about politicians. One of the problems with how our press works at the moment is that there tends to be one person that they talk about. There have been other chief executives and other senior directors of Post Office Ltd during the really difficult time when it was becoming apparent behind the scenes that there were problems. Today is not just about those who need to be held accountable in the future, but that must happen in due course. The contribution of the noble Lord, Lord Sikka, about the role of auditors, was very timely and very important. This would not be the first audit scandal of the last few years.
The noble Baroness, Lady Hoey, quoted from today’s comments by Fujitsu. The noble Lord, Lord Forsyth, said it had been 20 years, but it is clear that the problems started just after Peter Lilley MP signed off the pilot in 1994. Even then, the pilot postmasters were reporting problems—in 1995, 1996 and 1997. It goes right back. This is not party-political. I am just making the point that Fujitsu and the Post Office both knew that there were problems before the rollout started in 1999.
The Father of the House, Sir Peter Bottomley, said last week:
“The titanic error was the belief in technology”.—[Official Report, Commons, 8/1/24; col. 86.]
However, every day, including today—the noble Baroness, Lady Hoey, mentioned Fujitsu’s testimony to the Science, Innovation and Technology Committee—more is revealed about what the company knew, even from prior to the rollout, as I have just mentioned. The noble Baroness, Lady Jones, talked about the chief executive admitting today that funds that postmasters were forced to pay may have gone into executive pay. If that is true, it is an absolute disgrace.
The noble Lord, Lord Browne, and others, talked about computer problems. I am married to an engineer. He is not a software engineer, but he deals with software in the things that he designs. One of my foster children is a software engineer. They look at each other with raised eyebrows and talk about “garbage in, garbage out”. “Garbage in” is done by people, not by computers. The problem that the noble Lord, Lord Browne, raises, is, “Will that happen in the future?” We have to hold Fujitsu to account for those errors, which it then clearly did nothing about. The noble Lord, Lord Forsyth, said that he felt ashamed. I feel ashamed too. I want to quote from Professor Graham Zellick KC, the former chairman of the Criminal Cases Review Commission. He was angrier than we are. He said:
““I am enraged. I think this is deplorable. It is inexcusable. It is a failure of public administration and government without precedent. It makes one’s blood boil”.
I hope that we continue with that strength of feeling as we move into the next stage and the drama moves out of the limelight, because we must learn lessons from this. The Secret Barrister—some noble Lords may follow him on Twitter/X—said:
“As the issue of compensation for miscarriages of justice is rightly in the news, it’s timely to note that in 2014, the government changed the law to make it all but impossible for people wrongly convicted and imprisoned to claim compensation”.
Much has already been said in this debate, but I want to go on to talk briefly about the future. Various Members have talked about the problems that people in the HSS—the Horizon shortfall scheme, now known as the historic shortfall scheme—have had with the application form. The noble Lord, Lord Sikka, referred to a case where someone claimed only £15.75 because he did not understand the form; there was a reference in it to looking at Appendix 1, but it was so impenetrable that he thought it did not apply to him.
Another case cited by Dan Neidle, who runs Tax Policy Associates, concerned someone who was made bankrupt, lost his post office in a fire sale and has been offered £8,000. The numbers of people receiving offers from Post Office Ltd for compensation are good, but if compensation is at that level, it is not good and it is inappropriate. We need a more transparent mechanism to streamline the current complex arrangements, which Government after Government have created with crisis after crisis, to have what amounts to two and a half schemes running—the GLO and the HSS scheme and then the new review scheme that was announced 10 days ago.
Dan Neidle says we should probably follow the example of employment tribunals. For example, why are sub-postmasters not allowed a grant for legal advice before they put in their applications? They should be. There should be a larger fixed amount for damages; cases are different, but everyone who has been involved, whether they have been convicted or not, has lost income, often their job and their home, and been unable to work at the level they were working at before because of the threats they were under. Redress needs to reflect their loss of earnings. They should also receive the very specific amounts of money that they were forced to pay back—not compensation. They should be paid back the money they had to pay in error. The idea of those who were convicted and imprisoned having to pay charges for bed and breakfast from their compensation is an absolute outrage that should not be allowed. On occasion, there will be specific damage above and beyond that outlined which might, for example, cover a suicide in a family or those who have had strokes.
Finally, we should consider a complete change to the way in which these compensation schemes operate. Next week in Committee on the Victims and Prisoners Bill, we have an amendment on the infected blood scheme. We are still waiting for the details of the interim payments. The first young people were infected in the mid-1970s—it cannot go on like this. Others have spoken about the Windrush scheme; I would raise Hillsborough and Grenfell, where there are similarly complex arrangements. Surely, now is the time to consult on future arrangements for compensation schemes, including whether they should remain with government or be independent, so we can be sure that we have a reliable, independent, swift and fair scheme that cannot be constantly adjusted, ignored or delayed, particularly by politicians.
Lord McNicol of West Kilbride (Lab)
My Lords, I welcome this Bill and am glad that the Government have accepted Sir Wyn Williams’s recommendations in his interim report that the current deadline for compensation must be extended. It is my hope, as has been said by many this evening, that the extra time the Bill provides for is not needed, and that compensation is delivered as quickly as possible.
Labour is committed to working with the Government to ensure the best possible outcome for victims. As the shadow Leader of the House of Commons said last week, justice delayed is justice denied. It is deeply shameful that, 25 years after the rollout of Horizon began and 15 years after this scandal was first revealed by journalists and campaigners, victims are still seeking justice. It is particularly saddening that justice did not come quickly enough for the more than 60 sub-postmasters and sub-postmistresses who died before being compensated and before having their convictions overturned. It is incumbent upon us to ensure that justice is delivered, and delivered urgently.
I am glad that the Government have committed to mass exoneration to save victims having to relive their trauma and that the Metropolitan Police has opened an investigation into those who caused it. My noble friend Lady Chakrabarti is right: it will be difficult to unpick and there will be legal issues, but it is incumbent on all of us to overturn these convictions and allow people to move on as quickly as possible.
The question still remains around why it took an ITV drama for justice to finally be tabled for the victims. The noble Lord, Lord Forsyth, touched on the board, and I remember standing here four years ago after the Court of Appeal decision, when one of the issues that we touched on was how much the lawyers had taken out of the £58 million. I think £12 million was left. That point was raised by a number of noble Lords, and I asked a question then about the chief executive and the board. I had no idea that there had been 80 members of the board—it would be interesting to look through them now—but questions were asked four or five years ago about their culpability. The Minister—not the noble Lord, Lord Offord, but the previous Minister dealing with it—was again very positive about what we needed to do, but we still have not seen any action taken against the individuals who had oversight at that time. That is something that we need to look at and make sure we resolve for the future.
The public are rightly sick and tired of scandal after scandal, which has again been a theme of this debate. From Hillsborough to Grenfell, from Windrush to infected blood, we have had enough of the destruction of innocent people’s lives, the cover-ups, the vindictive way in which victims are treated once they come forward and the lethargic speed at which the Government act.
The Post Office has used the opportunity of the last decade not to hold up its hands and make amends to those it has wronged but to do everything it can to protect the bottom line and its once good name. Only last week, it was revealed that the Post Office had claimed tax relief on the compensation payments it made. As compensation is not a legitimate tax-deductible business expense, HMRC will likely be investigating the matter, and it is reported that the taxpayer may have to foot another bill, just short of £100 million, to settle what the Post Office owes the Exchequer. This was not before its creative accounting meant that bonuses could be paid to senior executives in line with its false levels of profitability. My question to the Minister is whether those moneys will be reclaimed by either the Post Office or the Government.
I will pick up the point made by the noble Baroness, Lady Brinton, about only ever focusing on one of the CEOs and move to another. In 2022, the then Post Office CEO Nick Read received a bonus of £137,000. According to Tax Policy Associates, the average payout under the Post Office Horizon shortfall scheme was £32,000 before tax. As we have heard tonight, from my noble friend Lord Sikka and the noble Baroness, Lady Brinton, one applicant was paid out £15.75, while also signing to say that he relinquished any future claims. I hope that that will be overturned and dealt with.
My noble friend Lord Browne and the noble Baroness, Lady Brinton, touched on ways of moving forward with this. As has been said, Dan Neidle has made the argument for looking at an employment tribunal-style way of dealing with this that will set levels we can move up from. I am interested to hear the Minister’s response to that.
Alongside compensation, we must seek reforms, not just of systems and structures at the corporate, judicial and governmental levels but of culture. The culture of covering up instead of owning up has cost so many sub-postmasters and sub-postmistresses their livelihoods, their relationships—which we have not really touched on—their dignity and in some cases their lives. The culture was one of being rewarded for failure, and of the people responsible for administering scandal not only not being held responsible for their actions but in some cases receiving handsome bonuses, honours and new jobs. It was a culture that, in this case, meant that the scandal was compounded; that prosecutions continued long after the Post Office became aware of the flaws of the Horizon software; and that lawyers helped mislead Parliament and the courts, and threatened journalists working to uncover the truth. It was a culture in which, as we have heard, the Post Office made compensation forms deliberately difficult for sub-postmasters to complete in order to minimise payments; in which a former Post Office Minister was paid a six-figure sum for advising the firm legally representing the Post Office; and in which the Business Department nominated Paula Vennells for a CBE two years after group action lawsuits had been launched in the High Court.
Responsibility and accountability are vital. I am glad that the leader of the Opposition made standards in public life a key part of his campaign when we entered this new year. The public are crying out for trust in their leaders. They need faith in a system and government that works; faith that each week will not bring about a new scandal; and faith that the worst instincts of humans will not be indulged or rewarded but punished. Those parliamentarians campaigning for the sub-postmasters and sub-postmistresses have helped show that Parliament and parliamentarians can stand in a good light. As my noble friend Lord Browne and the noble Lord, Lord Forsyth of Drumlean, said in referring to the noble Lord, Lord Arbuthnot, and Kevan Jones MP, they represent the best of public life. It is my hope that this scandal could be our last, and that the collective jolting of the public consciousness that has occurred over the last month will lead to a serious shift in the way that those in power are permitted to act. With that, we on these Benches support the Bill.
Lord Offord of Garvel (Con)
My Lords, it is with great responsibility that I stand to conclude what has been a respectful debate. We have heard many insightful and personal contributions from noble Lords across this House. I particularly echo the numerous and heartfelt tributes paid to my noble friend Lord Arbuthnot, who has been a long-time champion of those affected by the Horizon scandal. A key part of this is that the noble Lord, plus Kevan Jones MP in the other place, are members of the Liaison Committee, where my colleague Minister Hollinrake is dealing directly with them on a daily basis. That is an important part of the architecture of this, and something that the sub-postmasters and sub-postmistresses have expressed confidence in. Again, that is a great tribute to my noble friend.
I will start by picking up on the remarks of my noble friend Lord Arbuthnot. Yes, this will be a simple piece of legislation, but it will encompass the question raised by the noble Baroness, Lady Chakrabarti, who asked whether this will be a blanket exoneration. The answer is yes: this is a blanket exoneration to be given to the sub-postmasters—those who have had convictions —and speedy compensation will be given to all on the basis that, as was mentioned by the noble Lord, Lord Palmer, these folks are presumed innocent rather than guilty. So I can start by saying that this Bill exactly achieves what my noble friend Lord Arbuthnot was going to be pitching for; that has been delivered with the support of the Prime Minister and Minister Hollinrake.
In terms of speed of compensation, I reassure the House that our plan is to keep going, not to go more slowly. The delay here is not a delay of time: it is just allowing the due process to move through. Alongside the Bill, we have made a commitment to make offers on 90% of cases within 40 working days of receiving the GLO application, and we will publish monthly updates about the number of cases submitted and settled. In fact, to answer the question raised by my noble friend Lord Arbuthnot, it is actually the Government’s aim not to require a technical extension. The aim of the Government is to actually have this compensation made by 7 August, within the original timetable. Technically, that is not entirely within the Government’s gift because, clearly, claimants are underrepresented and need to give some evidence on their claims. They want each of their claims to be assessed on an individual basis, which is the right thing to do, and that is often not a simple process. They are telling us that it takes time, and they are saying that they want sufficient time to bring in their claim.
There are a number of folks who are affected but do not want to do that, which is why we are giving them the opportunity to go straight to up-front compensation within the GLO scheme. If you are just done with lawyers and completely scunnered by the process, and you feel that you want to take the £75,000, those who choose that route can take that straight up front and therefore get away from the lengthy claims process. We want to ensure that no one is timed out of compensation or rushed into making decisions. That is what the statutory inquiry, chaired by Sir Wyn Williams, has recommended, and we have taken action to address that.
I will turn now to a number of the points raised in the House this evening by noble Lords. The key objective of this Bill is that we have redress—that is a very good word that we should be using; compensation is compensation, but is it not the idea that we have to provide restitution for people have been wronged, to put them back in the position that they were in before?
The noble Lords, Lord Browne and Lord Sikka, and a number of other noble Lords, mentioned some of the paltry sums that have been quoted in terms of individual claims. In fact, when one looks at the overall Horizon shortfall scheme—the main HSS scheme, which is for those 2,500 claims for people who were not convicted—the average on that is £42,000 per sub-postmaster. That gives you an indication that there is quite a wide range of claims. It is quite right that there is not one single number for everybody, because each claim needs to be assessed on its merits. That gives some context to the £75,000 being offered to the GLO claimants who consider that they have a further claim to process.
Then, in the hierarchy of compensation, for those 983 people who have been wrongly convicted, of whom 95 have had their wrongful convictions overturned, there is an immediate ability to claim £600,000—again, without access to lawyers and without having to go through any process. That is your right as a claimant to take that. Again, however, if you feel that you deserve and should be compensated for more than that figure, there is no limit. There is no upper limit—to answer the noble Lord, Lord Sikka—to what can be claimed.
We are dealing with a cohort of individuals who, as my noble friend Lord Arbuthnot mentioned, are quite traumatised by this process. They watched the first GLO court action being successful and three-quarters of the money going to the lawyers, the claim administrators or the investors in the litigation, so there is deep scepticism within this cohort and community about the process being run.
Again, to answer the question from the noble Lord, Lord Sikka, the GLO scheme is being run by DBT, not the Post Office. The Post Office is running the Horizon scheme. Therefore, that is crucially where the advisory committee comes into play to make sure that there is a clear, independent voice for those who are feeling uncomfortable with that. In terms of the overturned convictions, the retired High Court judge Sir Gary Hickinbottom has been placed in to make sure that claimants feel they have an independent person to refer to.
I think in terms of process and redress the Government are making steps now to go fast, but it is up to each claimant to work out the process they want to go through. It is not right for me to comment on individual cases, but obviously the most egregious example given in the drama was that of Lee Castleton. I think his claim was about £26,000 but he ended up with a £320,000 bill. Again, I am not commenting on that case, but it does inform the £600,000 that can be claimed immediately against a case such as that. Indeed, if he felt he wanted to take that further, he could do that. That is a private matter for him.
Lord Forsyth of Drumlean (Con)
I know my noble friend the Minister does not want to comment on the particular case of Lee Castleton, but the point I was making about him was there were £325,000 of court costs. First, normally when you win you do not pay costs. The effect of saying that he is not guilty surely means that those costs should be returned. That has nothing to do with the compensation that is paid to him. So will costs be remitted? That is the key point. Secondly, in respect of that case, what do the Government mean when they say that things should be restored to where they would have been had this not happened? What does that mean because £600,000 is an arbitrary number? Some people lost their business, their house and their position. How will that principle, which I think is greatly to the Government’s credit, be delivered?
Lord Offord of Garvel (Con)
I commend my colleague the Postal Minister Mr Hollinrake for pushing through hard on the £600,000 because it is not for us to judge what any individual has lost; it is up to that individual claimant to make the decision about whether they want to go through the due legal process. The word “compensation” has perhaps been misapplied here. What we are actually talking about is a monetary sum to be given back which gives redress to individuals. In any particular case—for example, the case of Lee Castleton—it may well be that one can actually identify separate buckets, one of which might in fact be court costs be repaid, but within the overall settlement there will be an amount which should take account of all losses. If you have paid for someone else’s legal fees, that is a loss which needs to be repaid, so this will be tied up within each individual claim, the point being that if you do not as a postmaster want to go through the heartache and process of doing that, there is a route for you to receive a substantial sum and you can close the matter and get on with the rest of your life.
Lord Arbuthnot of Edrom (Con)
I would not want anyone to be confused in an already confusing situation. The £600,000 is not actually relevant to Lee Castleton because it is a sum that applies only to those who have overturned convictions. Lee Castleton was sued rather than prosecuted. I am sure he will get a lot more than that, which will include the legal costs that he had to pay and also all the issues about the bankruptcy that he went through and the horrors his family went through, and he will deserve a lot more than that.
Lord Offord of Garvel (Con)
I thank my noble friend for that clarification.
Moving onto another theme, there has obviously been a lot of comment on Fujitsu and we have all been horrified by the extent of what would appear to be its collusion in the matter. Again, we have to be very careful here to allow this inquiry to run its course. Sir Wyn Williams is very focused on this, and he will get it done through the course of this year. We will get answers to these questions.
Sir Wyn has been very clear, as indeed has Minister Hollinrake in the other place, that the cost of this must not fall solely on the taxpayer. We have now had the statement today from the European chief executive, effectively putting his hand up to say that he knows there is going to be a large bill to pay, and that it goes beyond moral to legal and financial. Again, that will be determined when we get through the inquiry.
The reality is that Fujitsu is embedded in all aspects of government, in many departments. We all feel nervous about that at this moment and I am sure that all departments will be reviewing that; but, again, we have to discover the extent of culpability. The company knows that it will have a large bill to pay. We have to allow that process to run its course. I am sure that there will be full accountability and from that—there is no question my mind—will cascade many levels of scrutiny of that company in every government department. I think we will be hearing more about that as we go.
The other theme brought through was governance of the Post Office. The noble Lord, Lord Forsyth, was very clear in asking how this works in respect of being a limited company with a board. The noble Lords, Lord Palmer and Lord Sikka, mentioned the whole accounting scenario. With respect to the current governance of the Post Office, it remains an arm’s-length statutory body; we are all now asking different questions about how that works.
Lord Offord of Garvel (Con)
Shorter arms, yes. There has been quite a big overhaul in terms of organisation, some of which is pretty obvious when you look at it. There is now a huge amount more central support and training given to postmasters. There are 100 new area managers, creating a buffer zone between the manager and the board. Two postmasters have now been appointed to the board as non-executive directors. There is an appointment of a current postmaster in a director role concerned with the day-to-day relationship with the postmasters. All of it should have been done a long time ago.
As we look at public bodies, those of us who have been in the private sector understand how boards work. We understand the role of non-executive directors, which is to challenge management. It is not to nod and pass, or to wave through. It is to be intellectually curious and, if you find something that does not stack up, to probe it and question it. That has not happened here. We have had an organisation that looks and feels like a plc. It has renumeration committees, audit committees, auditors, a board of directors, non-executive directors and a non-exec chair. All of these, when they are put into businesses, are put in for checks and balances, as the noble Lord, Lord Sikka, said. What we have had here is a mirror image of this architecture without any checks and balances. I think this requires us to look quite hard across quite a wide range of arm’s-length bodies.
Lord Sikka (Lab)
I am glad that the Minister has clarified that relationship, but my concern is that, for as long as I can remember, the Government have been preaching shareholder activism. What happened to that when it came to the shareholder—the Government —in the Post Office being active? Did nobody notice the pile of newspaper clippings about the cases? I do not remember any Minister standing up and saying “Right, we’re going to look at this” until after the High Court judgment. Why did the Government fail on their own so-called shareholder activism?
Lord Offord of Garvel (Con)
I thank the noble Lord for that searching question. Of course, this covers about three or four different Governments and more than half a dozen Ministers; that is just a fact. The reality is that the shareholder of the Post Office is the taxpayer. The share is owned by the Secretary of State for the Department for Business and Trade. Under the current structure, that is effectively subcontracted to an independent board. If that independent board had acted on an independent basis, this would not have happened. In fact, if Ministers had slightly more inquiring minds, this would not have happened.
I look at myself in my role as a Minister. I look at the advice that I am given and at the decisions I have to make. There is a lot coming through on a daily basis. I ask myself this question: if I had been in this role and prior to Horizon there had been an average of, say, 10 convictions per year in a bad year—maybe five on average—and that went up to 80, even though I was very busy, doing a lot of things, and even though I said I had an independent board looking at this for me, would not that raise some inquiry? This fundamentally is the shocking scale—we are all embarrassed about this—of the abuse here. The accountability piece of this will absolutely come through the Wyn Williams inquiry. That will then move us to the next stage of the lessons that we learn from it.
Next is the theme of legal process, brought up by the noble Lord, Lord Cormack, as well as the noble Lords, Lord Forsyth and Lord Weir, and also in relation to the Scottish angle. The noble Lord, Lord Cormack, says that the lawyers have some disquiet about the idea of Parliament overruling courts, but we have had the counterbalancing argument from William Blackstone. I think the House agrees that that overrides that particular issue.
In Scotland and Northern Ireland we have different jurisdictions. There were 77 prosecutions in Scotland and 24 in Northern Ireland. To speak from a Scottish point of view, those prosecutions were brought not by the Post Office but by the Crown Office. That is a separate legal jurisdiction in Scotland. Yes, we are one United Kingdom, but in the UK we respect the legal jurisdictions of the devolved nations. The Lord Advocate has reported today to Holyrood, the devolved Parliament in Edinburgh, saying that she is not currently in favour of a blanket rescinding of convictions because, she says, not every case involving Horizon will be a miscarriage of justice. She wishes to go through the appeal court—the Scottish Criminal Cases Review Commission. From a legal point of view, she is saying that these convictions were made by a court and therefore should be undone by a court.
We are at an early stage of that dialogue. There are letters and communication going between the MoJ in London and the Lord Advocate and the Crown Office in Scotland, and there is communication between the First Minister and the Prime Minister on this. That just highlights that there are some legal complexities here. The reserved matter remains reserved. Compensation will be the same for all jurisdictions, but there are some issues to be resolved regarding the actual legal process—certainly north of the border.
Lord Browne of Ladyton (Lab)
How on earth does a court challenge the evidence that the information coming from this computer is to be treated correctly because of the presumption? How on earth does the court overcome that? Only we can overcome that. We need to change the law. Unless we do so, we will always have this problem. The fact of the matter is that everywhere on this island the courts are not fit to deal with these cases. There were miscarriages of justice everywhere. The courts were not fit to test the evidence.
Lord Offord of Garvel (Con)
That is exactly the position that has been taken here by the Lord Chancellor for England and Wales, and that is now the conversation that has to be had in Scotland and Northern Ireland. We are dealing with a legal complexity that was confronted earlier this week by the Lord Chancellor, who now needs to run through the process with the Lord Advocate.
We come to the accountability issue. There have been comments from the noble Lords, Lord Sikka and Lord Palmer, about the role of the auditors. Again, you will get technical answers back that this is a separate statutory body that does not account to the National Audit Office because it has its own auditors, but then we find that that the auditor, EY, has signed off on the accounts. This is what we need to get to the bottom of. There needs to be a full inquiry to bring this to light. We will get the answers to these questions. Out of this, as I said, there will be a cascade of inquiry taking us into the fundamental territory of how the Government operate alongside quangos, arm’s-length bodies and so on. We have not heard the last of this. Its repercussions will come down through Whitehall.
Lessons will be learned, but right now our responsibility is to get the blanket exoneration that the noble Baroness, Lady Chakrabati, was asking for, and which my noble friend Lord Arbuthnot is now satisfied will be given, and getting the compensation—whatever that means; let us say financial restitution—to the claimants as quickly as possible.
This is a sorry saga and, as my noble friend Lord Forsyth said, we are all deeply embarrassed by it. It has taken so long; it has been going on for 20 years. How people did not ask more basic questions is something that we all need to reflect on. All of us Ministers are looking at that. From my own personal point of view, I am certainly looking at things quite differently through the lens of, “Where’s my sniff test on what I’m hearing, as opposed to just what I’m told by officials?”
I commend the noble Lord, Lord Weir, on his personal reflections on this and his story about his father being a postmaster. Is that not the essence of what we got from the series, and from our personal experience in the towns and villages where we live, that these folks are the salt of the earth? How could they as a group suddenly become criminal? How could we go from half a dozen convictions a year to 80? It just does not make any sense. So I thank the noble Lord for that contribution. That is what is turbocharging our response to this matter.
I say in conclusion to noble Lords that, as far as my department is concerned—and my colleague Mr Hollinrake is working very hard to ensure this—those who are affected by this awful scandal will receive the full and fair compensation that they are owed, and we will do that as quickly as possible. Postmasters have suffered for too long. That said, with their having waited so long for justice, the Bill ensures that the Government will not need to force victims into unduly rushed decisions on the complex and emotive issues of compensation.
I repeat my thanks to all noble Lords for their contributions today. I know the House takes a strong interest in this scandal and wider Post Office matters. I hear what the noble Baroness, Lady Brinton, said about where this takes us on previous scandals, and I am sure there is more to be said about that. This Bill is just one part of the extensive action that the Government are taking to defend the interests of postmasters, and I commend it to the House.