Grand Committee
Data (Use and Access) Bill [HL]
Monday 16th December 2024
(2 days, 6 hours ago)
Grand CommitteeRead Full debate Data (Use and Access) Bill [HL] 2024-26 View all Data (Use and Access) Bill [HL] 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 40-III(a) Amendments for Grand Committee (Supplementary to the Third Marshalled List) - (13 Dec 2024)
The Deputy Chairman of Committees (Lord Haskel) (Lab)
My Lords, if there is a Division in the Chamber while we are sitting, the Committee will adjourn as soon as the Division Bells are rung and resume after 10 minutes.
Lord Clement-Jones (LD)
My Lords, in carrying on on this group, I will speak to the question that Clause 78 stands part, and to Amendments 107, 109, 125, 154, 155 and 156, but to start I support Amendment 87 in the name of the noble and learned Lord, Lord Thomas of Cwmgiedd. We had a masterclass from him last Tuesday and he made an extremely good case for that amendment, which is very elegant.
The previous Government deleted the EU Charter of Fundamental Rights from the statute book through the Retained EU Law (Revocation and Reform) Act 2023, and this Bill does nothing to restore it. Although references in the UK GDPR to fundamental rights and freedoms are now to be read as references to the ECHR as implemented through the Human Rights Act 1998, the Government’s ECHR memorandum states:
“Where processing is conducted by a private body, that processing will not usually engage convention rights”.
As the noble and learned Lord mentioned, this could leave a significant gap in protection for individuals whose data is processed by private organisations and will mean lower data protection rights in the UK compared with the EU, so these Benches strongly support his Amendment 87, which would apply the convention to private bodies where personal data is concerned. I am afraid we do not support Amendments 91 and 97 from the noble Viscount, Lord Camrose, which seem to hanker after the mercifully defunct DPDI.
We strongly support Amendments 139 and 140 from the noble Baroness, Lady Kidron. Data communities are one of the important omissions from the Bill. Where are the provisions that should be there to support data-sharing communities and initiatives such as Solid? We have been talking about data trusts and data communities since as long ago as the Hall-Pesenti review. Indeed, it is interesting that the Minister herself only this April said in Grand Committee:
“This seems to be an area in which the ICO could take a lead in clarifying rights and set standards”.
Indeed, she put forward an amendment:
“Our Amendment 154 would therefore set a deadline for the ICO to do that work and for those rights to be enacted. The noble Lord, Lord Clement-Jones, and the noble Baroness, Lady Kidron, made a good case for broadening these rights in the Bill and, on that basis, I hope the Minister will agree to follow this up, and follow up his letter so that we can make further progress on this issue”.—[Official Report, 17/4/24; col. GC 322.]
I very much hope that, now the tables are turned, so to speak, the Minister will take that forward herself in government.
Amendments 154, 155 and 156 deal with the removal of the principle of the supremacy of EU law. They are designed to undo the lowering of the standard of data protection rights in the UK brought about by the REUL Act 2023. The amendments would apply the protections required in Article 23.2 of the UK GDPR to all the relevant exceptions in Schedules 2 to 4 to the Data Protection Act 2018. This is important because data adequacy will be lost if the standard of protection of personal data in the UK is no longer essentially equivalent to that in the EU.
The EU’s adequacy decision stated that it did not apply in the area of immigration and referred to the case of Open Rights Group v the Secretary of State for the Home Department in the Court of Appeal. This case was brought after the UK left the EU, but before the REULA came into effect. The case is an example of how the preservation of the principle of the supremacy of EU law continued to guarantee high data protection standards in the UK, before this principle was deleted from the statute book by the REULA. In broad terms, the Court of Appeal found that the immigration exception in Schedule 2 to the Data Protection Act 2018 conflicted with the safeguards in Article 23 of the UK GDPR. This was because the immigration exemption was drafted too broadly and failed to incorporate the safeguards prescribed for exemptions under Article 23.2 of the UK GDPR. It was therefore held to be unlawful and was disapplied.
The Home Office redrafted the exemption to make it more protective, but it took several attempts to bring forward legislation which provided sufficient safeguards for data subjects. The extent of the safeguards now set out in the immigration exemption underscores both what is needed for compatibility with Article 23.2 of the UK GDPR and the deficiencies in the rest of the Schedule 2 exemptions. It is clear when reading the judgment in the Open Rights case that the majority of the exemptions from data subject rights under Schedule 2 to the Data Protection Act fail to meet the standards set out in Article 23.2 to the UK GDPR. The deletion of the principle of the supremacy of EU law has removed the possibility of another Open Rights-style challenge to the other exemptions in Schedule 2 to the Data Protection Act 2018. I hope that, ahead of the data adequacy discussions with the Commission, the Government’s lawyers have had a good look at the amendments that I have tabled, drafted by a former MoJ lawyer.
The new clause after Clause 107 in Amendment 154 applies new protections to the immigration exemption to the whole of Schedule 2 to the DPA 2018, with the exception of the exemptions that apply in the context of journalism or research, statistics and archiving. Unlike the other exemptions, they already contain detailed safeguards.
Amendment 155 is a new clause extending new protections which apply to the immigration exemption to Schedule 3 to the DPA 2018, and Amendment 156 is another new clause applying new protections which apply to the immigration exemption to Schedule 2 to the DPA 2018.
As regards Amendment 107, the Government need to clarify how data processing under recognised legitimate interests are compatible with conditions for data processing under existing lawful bases, including the special categories of personal data under Articles 5 and 9 of the UK GDPR. The Bill lowers the standard of the protection of personal data where data controllers only have to provide personal data based on
“a reasonable and proportionate search”.
The lack of clarity on what reasonable and proportionate mean in the context of data subject requests creates legal uncertainty for data controllers and organisations, specifically regarding whether the data subject’s consideration on the matter needs to be accounted for when responding to requests. This is a probing amendment which requires the Secretary of State to explain why the existing lawful bases for data processing are inadequate for the processing of personal data when additional recognised legitimate interests are introduced. It requires the Secretary of State to publish guidance within six months of the Act’s passing to clarify what constitutes reasonable and proportionate protections of personal data.
Amendment 109 would insert a new clause, to ensure that data controllers assess the risk of collective and societal harms,
“including to equality and the environment”,
when carrying out data protection impact assessments. It requires them to consult affected people and communities while carrying out these assessments to improve their quality, and requires data controllers to publish their assessments to facilitate informed decision-making by data subjects and to enable data controllers to be held accountable.
Turning to whether Clause 78 should stand part, on top of Clause 77, Clause 78 would reduce the scope of transparency obligations and rights. Many AI systems are designed in a way that makes it difficult to retrieve personal data once ingested, or understand how this data is being used. This is not principally due to technical limitations but the decision of AI developers who do not prioritise transparency and explainability.
As regards Amendment 125, it is clear that there are still further major changes proposed to the GDPR on police duties, automated decision-making and recognised legitimate interests which continue to make retention of data adequacy for the purposes of digital trade with the EU of the utmost priority in considering those changes. During the passage of the Data Protection and Digital Information Bill, I tabled an amendment to require the Government to publish an assessment of the impact of the Bill on EU/UK data adequacy within six months of the Act passing; I have tabled a similar amendment, with one change, to this Bill. As the next reassessment of data adequacy is set for June 2025, a six-month timescale may prove inconsequential to the overall adequacy decision. We must therefore recommend stipulating that this assessment takes place before this reassessment.
The Parliamentary Under-Secretary of State, Department for Business and Trade and Department for Science, Information and Technology (Baroness Jones of Whitchurch) (Lab)
My Lords, I thank all noble Lords for their consideration of these clauses. First, I will address Amendment 87 tabled by the noble and learned Lord, Lord Thomas, and the noble and learned Lord—sorry, the noble Lord—Lord Clement-Jones.
Baroness Jones of Whitchurch (Lab)
We should take them while we can. Like the noble Lord, Lord Clement-Jones, I agree that the noble and learned Lord, Lord Thomas, made an excellent contribution. I appreciate this is a particularly technical area of legislation, but I hope I can reassure both noble Lords that the UK’s data protection law gives effect to convention rights and is designed to protect them. The Human Rights Act requires legislation to be interpreted compatibly with convention rights, whether processing is carried out by public or private bodies. ECHR rights are therefore a pervasive aspect of the rules that apply to public and private controllers alike. The noble and learned Lord is right that individuals generally cannot bring claims against private bodies for breaches of convention rights, but I reassure him that they can bring a claim for breaching the data protection laws giving effect to those rights.
I turn to Amendment 91, tabled by the noble Viscount, Lord Camrose, Amendment 107, tabled by the noble Lord, Lord Clement-Jones, and the question of whether Clause 78 should stand part, which all relate to data subject requests. The Government believe that transparency and the right of access is crucial. That is why they will not support a change to the language around the threshold for data subject requests, as this will undermine data subjects’ rights. Neither will the Bill change the current expectations placed on controllers. The Bill reflects the EU principle of proportionality, which has always underpinned this legislation, as well as existing domestic case law and current ICO guidance. I hope that reassures noble Lords.
Amendments 97 and 99, tabled by the noble Viscount, Lord Camrose, and the noble Lord, Lord Markham, relate to the notification exemption in Article 14 of the UK GDPR. I reassure noble Lords that the proportionality test provides an important safeguard for the existing exemption when data is collected from sources other than the data subject. The controller must always consider the impact on data subjects’ rights of not notifying. They cannot rely on the disproportionate effort exemption just because of how much data they are processing—even when there are many data subjects involved, such as there would be with web scraping. Moreover, a lawful basis is required to reuse personal data: a web scraper would still need to pass the balancing test to use the legitimate interest ground, as is usually the case.
The ICO’s recent outcomes report, published on 12 December, specifically referenced the process of web scraping. The report outlined:
“Web scraping for generative AI training is a high-risk, invisible processing activity. Where insufficient transparency measures contribute to people being unable to exercise their rights, generative AI developers are likely to struggle to pass the balancing test”.
Lord Clement-Jones (LD)
The Minister said there is a power to amend, but she has not said whether she thinks that would be desirable. Is the power to be used only if we are found not to be data-adequate because the immigration exemption does not apply across the board? That is, will the power be used only if we are forced to use it?
Baroness Jones of Whitchurch (Lab)
I reassure the noble Lord that, as he knows, we are very hopeful that we will have data adequacy so that issue will not arise. I will write to him to set out in more detail when those powers would be used.
Baroness Kidron (CB)
I thank the Minister for her offer of a meeting. I could tell from the nods of my co-signatories that that would indeed be very welcome and we would all like to come. I was interested in the quote from the ICO about scraping. I doubt the Minister has it to hand, but perhaps she could write to say what volume of enforcement action has been taken by the ICO on behalf of data rights holders against scraping on that basis.
Baroness Jones of Whitchurch (Lab)
Yes, it would be helpful if we could write and set that out in more detail. Obviously the ICO’s report is fairly recent, but I am sure he has considered how the enforcement would follow on from that. I am sure we can write and give more details.
Lord Thomas of Cwmgiedd (CB)
My Lords, I thank the Minister for her response. I wish to make three points. First, the critical question is: are our laws adequate to pass the adequacy test? Normally, when you go in for a legal test, you check that your own house is in order. I am therefore slightly disappointed by the response to Amendment 125. Normally one has the full-scale medical first, rather than waiting until you are found to be ill afterwards.
Secondly, I listened to what the Minister said about my Amendment 87 and the difference between what rights are protected by the charter and the much greater limitation of the ECHR, normally simply to do with the extent to which they apply horizontally to private individuals. I will look at her answer, but at first sight it does not seem right to me that, where you have fundamental rights, you move to a second stage of rights—namely, the rights under the Data Protection Act.
Thirdly, I want to comment on the whole concept of data communities and data trusts. This is an important area, and it takes me back to what I said last time: this legislation really needs trying to reduce to principles. I am going to throw out a challenge to the very learned people behind the Minister, particularly the lawyers: can they come up with something intelligible to the people who are going to do this?
This legislation is ghastly; I am sorry to say that, but it is. It imposes huge costs on SMEs—not to say on others, but they can probably afford it—and if you are going to get trust from people, you have to explain things in simple principles. My challenge to those behind the Minister is: can they draft a Clause 1 of the Bill to say, “The principles that underpin the Bill are as follows, and the courts are to interpret it in accordance with those principles”? That is my challenge—a challenge, as the noble Baroness, Lady Kidron, points out, to be ambitious and not to sit in a tepid bath. I beg leave to withdraw the amendment.
Member’s explanatory statement
This amendment reduces the likelihood of misuse of Clause 77 by AI model developers, who may otherwise seek to claim they do not need to notify data subjects of reuse for scientific purposes under Clause 77 because of the way that personal data is typically collected and processed for AI development, for example by scraping large amounts of personal data from the internet.
Viscount Colville of Culross (CB)
My Lords, I have tabled Amendments 92, 93, 101 and 105, and I thank the noble Lord, Lord Clement-Jones for adding his name to them. I also support Amendment 137 in the name of my noble friend Lady Kidron.
Clause 77 grants an exemption to the Article 13 and 14 rights of data subjects to be told within a set timeframe that their data will be reused for scientific research, if it would be impossible or involve disproportionate effort to do so. These amendments complement those I proposed to Clause 67. They aim to ensure that “scientific research” is limited in its definition and that the large language AI developers cannot say that they are doing scientific research and that the GDPR requirements involve too much effort to have to contact data subjects to reuse their data.
It costs AI developers time and money to identify data subjects, so this exemption is obviously very valuable to them and they will use it if possible. They will claim that processing and notifying data subjects from such a huge collection of data is a disproportionate effort, as it is hard to extract the identity of data subjects from the original AI model.
Up to 5 million data subjects could be involved in reusing data to train a large language model. However, the ICO requires data controllers to inform subjects that their data could be reused even if it involves contacting 5 million data subjects. The criteria set out in proposed new subsection (6) in Clause 77 play straight into the hands of ruthless AI companies that want to take advantage of this exemption.
Amendments 92 and 101 would ensure that the disproportionate effort excuse is not used if the number of data subjects is mentioned as a reason for deploying the excuse. Amendments 93 and 105 would clarify the practices and facts that would not qualify for the disproportionate effort exemption—namely,
“the fact the personal data was not collected from the data subject, or any processing undertaken by the controller that makes the effort involved greater”.
Without this wording, the Bill will mean that the data controller, when wanting to reuse data for training another large language model, could process the personal data on the original model and then reuse it without asking permission from the original subjects. The AI developer could say, “I don’t have the original details of the data subject, as they were deleted when the original model was trained. There was no identification of the original data subjects; only the data weight”. I fear that many companies will use this excuse to get around GDPR notification expectations.
Noble Lords should recognise that these provisions affect only AI developers seeking to reuse data under the scientific research provisions. These will mainly be the very large AI developers, which tend to use scrape data to train their general purpose models. Controllers will still be able to use personal data to train AI systems when they have lawful grounds to do so—they either have the consent of the data subject or there is a legitimate interest—but I want to make it clear that these provisions will not inhibit the legitimate training of AI models.
These amendments would ensure that organisations, especially large language AI developers, are not able to reuse data at scale, in contradiction to the expectations and intentions of data subjects. Failure to get this right will risk setting off a public backlash against the use of personal data for AI use, which would impede this Government’s aims of making this country an AI superpower. I beg to move.
Baroness Kidron (CB)
My Lords, in speaking to Amendment 137 in my name I thank the noble Baroness, Lady Harding, the noble Lord, Lord Stevenson, and my noble friend Lord Russell for their support. I also add my enthusiastic support to the amendments in the name of my noble friend Lord Colville.
This is the same amendment that I laid to the DPDI Bill, which at the time had the support of the Labour Party. I will not labour that point, but it is consistently disappointing that these things have gone into the “too difficult” box.
Amendment 137 would introduce a code of practice on children and AI. AI drives the recommender systems that determine all aspects of a child’s digital experience, including the videos they watch, their learning opportunities, the people they follow and the products they buy—and, as reported last weekend, AI is even helping farmers pick the ripest tomatoes for baked beans. But it no longer concerns simply the elective parts of life where, arguably, a child or a parent on their behalf can choose to avoid certain products and services. AI is invisibly and ubiquitously present in all areas of their lives, and its advances and impact are particularly evident in the education and health sectors, the first of which is compulsory for children and the second of which is necessary for all of us.
The amendment has three parts. The first requires the ICO to create a code and sets out the expectations of its scope; the second considers who and what should be consulted and considered, including experts, children, and the frameworks that codify children’s existing rights; and the third part defines elements of the process, including risk assessment definitions, and sets out the principles to which the code must adhere.
When we debated this before, I anticipated that the Minister would say that the ICO had already published guidance, that we do not want to exclude children from the benefits of AI, and that we must not get in the way of innovation. Given that the new Government have taken so many cues from the previous one, I am afraid I anticipate a similar response.
I first point out, therefore, that the ICO’s non-binding guidance on AI and data protection is insufficient. It has only a single mention of a child in its 140 pages, which is a case study about child benefits. In the hundreds of pages of guidance, toolkits and sector information, nowhere are the specific needs and rights, or development vulnerabilities, of children comprehensively addressed in relation to AI. This absence of children is also mirrored in government publications on AI. Of course, we all want children to enjoy the benefits of AI, but consideration of their needs would increase the likelihood of those benefits. Moreover, it seems reckless and unprincipled not to protect them from known harms. Surely the last three decades of tech development have shown us that the experiment of a “build first, worry about the kids later—or never” approach has cost our children dearly.
Innovation is welcome but not all innovation is equal. We have bots offering 13 year-olds advice on how to seduce grown men, or encouraging them to take their own lives, edtech products that profile children to unfair and biased outcomes that limit their education and life chances, and we have gen AI that perpetuates negative, racist, misogynist and homophobic stereotypes. Earlier this month, the Guardian reported a deep bias in the AI used by the Department for Work and Pensions. This “hurt first, fix later” approach creates a lack of trust, increases unfairness, and has real-world consequences. Is it too much to insist that we ask better questions of systems that may result in children going hungry?
Why children? I am saddened that I must explain this, but from our deeply upsetting debate last week on the child protection amendments, in which the Government asserted that children are already catered for while deliberately downgrading their protections, it seems that the Government or their advisers have forgotten.
Children are different for three reasons. First, as has been established over decades, children are on a development journey. There are ages and stages at which children are developmentally able to do certain things, such as walk, talk, understand risk and irony and learn different social skills. There are equally ages and stages at which they cannot do those things. The long-established consensus is that families, social groups and society more broadly, including government, step in to support them on this journey. Secondly, children have less voice and less choice about how and where they spend their time, so the places and spaces they inhabit have to be designed to be fit for childhood. Thirdly, we have a responsibility towards children that extends even beyond our responsibility to each other. This means that we cannot legitimatise profit at their expense. Allowing systems to play in the wild in the name of growth and innovation, leaving kids to pay the price, is a low bar.
It is worth noting that since we debated it, a proposal for this AI code for children that follows the full life cycle of development, deployment, use and retirement of AI systems has been drafted and has the support of multiple expert organisations and individuals around the globe. I am sure that all nations and intergovernmental organisations will have additional inputs and requirements, but it is worth saying that the proposed code, which was written with input from academics, computer scientists, lawyers, engineers and children’s rights activists, is mindful of and compatible with the EU AI Act, the White House Blueprint for an AI Bill of Rights, the Executive Order on the Safe, Secure and Trustworthy Development and Use of Artificial Intelligence, the Council of Europe’s Framework Convention on Artificial Intelligence and, of course, the UNCRC general comment no. 25.
This proposal will be launched early next year as an indication of what could and should be done. Unless the Government find their compass vis-à-vis children and tech, I suspect that another jurisdiction will adopt it ahead of the UK, making that the go-to destination for trusted tech development for child-safe products. It is perhaps worth reminding the Committee that one in three connected people is under 18, which is roughly 1 billion children. As the demographics change, the proportion and number of children will rise. It is a huge financial market.
Before I sit down, I shall briefly talk about the AADC because sometimes Ministers say that we already have a children’s code. The age-appropriate design code covers only ISS, which automatically limits it, and even the ICO by now agrees that its enforcement record is neither extensive nor impressive. It does not clearly cover the urgent area of edtech, which is the subject of another amendment, and, most pertinently to this amendment, it addresses AI profiling only, which means that it is limited in how it can look at the new and emerging challenges of generative AI. A revamp of the AADC to tackle the barriers of enforcement, account for technological advances, cover all products and services likely to be accessed by children and make our data regime AI-sensitive would be welcome, but rather than calling for a strengthening of the AADC, the ICO agreed to the downgrading of children’s data protection in the DPDI Bill and, again, has agreed to the downgrading of protections in the current Bill on ADM, scientific research, onward processing and so on. A stand-alone code for AI development is required because in this way we could be sure that children are in the minds of developers at the outset.
It is disappointing that the UK is failing to claim its place as the centre of regulated and trusted innovation. Although we are promised an AI Bill, the Government repeatedly talk of large frontier companies. AI is in every part of a child’s life from the news they read to the prices they pay for travel and goods. It is clear from previous groups that many colleagues feel that a data Bill with no AI provisions is dangerous commercially and for the communities of the UK. An AI Bill with no consideration of the daily impact on children may be a very poor next choice. Will the Minister say why a Labour Government are willing to abandon children to technology rather than building technology that anticipates children’s rights and needs?
Lord Holmes of Richmond (Con)
My Lords, it is a pleasure to follow my friend the noble Baroness, Lady Kidron, and to give full-throated support to my friend the noble Viscount, Lord Colville, on all his amendments. Given that the noble Baroness mentioned it and that another week has passed since we asked the Minister the question, will we see an AI Bill or a consultation before Santa comes or at some stage in the new year? I support all the amendments in this group and in doing so, as it is the first time I have spoken today in Committee, I declare my technology interests as set out in the register, not least as an adviser to Socially Recruited, an AI business.
I will speak particularly to my Amendment 211A. I have put down “image, likeness and personality” not because I believe that they stand as the most important rights that are being transgressed or that they are the most important rights which we should consider; I have put them down to give a specific focus on them because, right now, they are being largely cut across and ignored, so that all of our creatives find themselves with their works, but also image, likeness and personality, disappearing into these largely foundation AI models with no potential for redress.
Once parts of you such as your name, face or voice have been ingested, as the noble Lord, Lord Clement-Jones, said in the previous group, it is difficult then to have them extracted from the model. There is no sense, for example, of seeking an equitable remedy to put one back in the situation had the breach not occurred. It is almost “once in, forever in”, then works start to be created based on those factors, features and likenesses, which compete directly with the creatives. This is already particularly prevalent in the music industry.
What plans do the Government have in terms of personality rights, image and likeness? Are they content with the current situation where there is no protection for our great creatives, not least in the music industry? What does the Bill do for our creatives? I go back to the point made by the noble Baroness, Lady Kidron. How can we have all these debates on a data Bill which is silent when it comes to AI, and a product regulation Bill where AI is specifically excluded, and yet have no AI Bill on the near horizon—unless the Minister can give us some up-to-date information this afternoon? I look forward to hearing from her.
Baroness Harding of Winscombe (Con)
My Lords, I should first apologise for not being able to attend Second Reading or, arguably more importantly, to be in Committee last week to support the many amendments of the noble Baroness, Lady Kidron, on child protection. I read Hansard carefully and was deeply depressed to see that we were once again needing to rehearse, as she has done again today, the importance of protecting children in the digital era. It seems to be our lot that there is a group of us who keep coming back. We play the merry-go-round and sit in different places; it is a privilege to sit next to the noble Baroness, Lady Kidron, for the first time in the decade that I have been in the House. I support her Amendment 137. She has given a good exposé as to why we should think really carefully about how we protect children in this AI world. I would just like to add one point about AI itself.
We keep being told—in a good way—that AI is an underlying and general-purpose technology. That means we need to properly establish the principles with which we should protect children there. We know that technology is morally neutral; it is the human beings who do the damage. In every other underlying, breakthrough technology, we have learned that we have needed to protect the most vulnerable, whether it was electricity when it first went into factories, toys when they were first distributed on the mass market, or social media, with the age-appropriate design code. I feel that it would be a huge mistake, on the third Bill where many of us have debated this subject matter, for us not to address the fact that, as of today, this is the biggest breakthrough technology of our lifetime. We should recognise that children will need protecting, as well as having the opportunity to benefit from it.
Lord Kirkhope of Harrogate (Con)
My Lords, I was not going to rise at all for the moment because there are other amendments coming later that are of interest. I declare my rather unusual interest: I was one of the architects of the GDPR in Brussels.
I rise to support Amendment 211A in the name of my noble friend Lord Holmes because here we are referring to AI. I know that other remarks have now been passed on this matter, which we will come to later, but it seems to me—this has come straight into my mind—that, when the preparation of the data legislation and the GDPR was being undertaken, we really did fail at that stage to accommodate the vast and important areas that AI brings to the party, as it were. We will fail again, I suspect, if we are not careful, in this piece of legislation. AI is with us now and moving at an enormous pace—faster than any legislator can ever manage to keep up with in order to control it and to make sure that there are sufficient protections in place for both the misuse of this technology and the way it may develop. So I support this amendment, particularly in relation to the trading or use of likenesses and the algorithmic effects that come about.
We will deal with that matter later, but I hope that the Minister will touch on this, particularly having heard the remarks of my noble friend Lord Holmes—and, indeed, the remarks of my noble friend Lady Harding a moment ago—because AI is missing. It was missing in the GDPR to a large extent. It is in the European Union’s new approach and its regulations on AI, but the EU has already shown that it has enormous difficulties in trying to offer, at one stage, control as well as redress and the proper involvement of human beings and individual citizens.
Lord Russell of Liverpool (CB)
My Lords, I rise briefly to support my noble friend Lady Kidron on Amendment 137. The final comments from the noble and learned Lord, Lord Thomas, in our debate on the previous group were very apposite. We are dealing with a rapidly evolving and complex landscape, which AI is driving at warp speed. It seems absolutely fundamental that, given the panoply of different responsibilities and the level of detail that the different regulators are being asked to cover, there is on the face of what they have to do with children absolute clarity in terms of a code of practice, a code of conduct, a description of the types of outcomes that will be acceptable and a description of the types of outcomes that will be not only unacceptable but illegal. The clearer that is in the Bill, the more it will do something to future-proof the direction in which regulators will have to travel. If we are clear about what the outcomes need to be in terms of the welfare, well-being and mental health of children, that will give us some guidelines to work within as the world evolves so quickly.
Lord Stevenson of Balmacara (Lab)
My Lords, I have co-signed Amendment 137. I do not need to repeat the arguments that have already been made by those who have spoken before me on it; they were well made, as usual. Again, it seems to expose a gap in where the Government are coming from in this area of activity, which should be at the forefront of all that they do but does not appear to be so.
As has just been said, this may be as simple as putting in an initial clause right up at the front of the Bill. Of course, that reminds me of the battle royal we had with the then Online Safety Bill in trying to get up front anything that made more sense of the Bill. It was another beast that was difficult to ingest, let alone understand, when we came to make amendments and bring forward discussions about it.
My frustration is that we are again talking about stuff that should have been well inside the thinking of those responsible for drafting the Bill. I do not understand why a lot of what has been said today has not already appeared in the planning for the Bill, and I do not think we will get very far by sending amendments back and forward that say the same thing again and again: we will only get the response that this is all dealt with and we should not be so trivial about it. Could we please have a meeting where we get around the table and try and hammer out exactly what it is that we see as deficient in the Bill, to set out very clearly for Ministers where we have red lines—that will make it very easy for them to understand whether they are going to meet them or not—and do it quickly?
Lord Clement-Jones (LD)
My Lords, the debate on this group emphasises how far behind the curve we are, whether it is by including new provisions in this Bill or by bringing forward an AI Bill—which, after all, was promised in the Government’s manifesto. It emphasises that we are not moving nearly fast enough in thinking about the implications of AI. While we are doing so, I need to declare an interest as co-chair of the All-Party Parliamentary Group on AI and a consultant to DLA Piper on AI policy and regulation.
I have followed the progress of AI since 2016 in the capacity of co-chair of the all-party group and chair of the AI Select Committee. We need to move much faster on a whole range of different issues. I very much hope that the noble Lord, Lord Vallance, will be here on Wednesday, when we discuss our crawler amendments, because although the noble Lord, Lord Holmes, has tabled Amendment 211A, which deals with personality rights, there is also extreme concern about the whole area of copyright. I was tipped off by the noble Lord, Lord Stevenson, so I was slightly surprised that he did not bring our attention to it: we are clearly due the consultation at any moment on intellectual property, but there seems to be some proposal within it for personality rights themselves. Whether that is a quid pro quo for a much-weakened situation on text and data mining, I do not know, but something appears to be moving out there which may become clear later this week. It seems a strange time to issue a consultation, but I recognise that it has been somewhat delayed.
In the meantime, we are forced to put forward amendments to this Bill trying to anticipate some of the issues that artificial intelligence is increasingly giving rise to. I strongly support Amendments 92, 93, 101 and 105 put forward by the noble Viscount, Lord Colville, to prevent misuse of Clause 77 by generative AI developers; I very much support the noble Lord, Lord Holmes, in wanting to see protection for image, likeness and personality; and I very much hope that we will get a positive response from the Minister in that respect.
We have heard from the noble Baronesses, Lady Kidron and Lady Harding, and the noble Lords, Lord Russell and Lord Stevenson, all of whom have made powerful speeches on previous Bills—the then Online Safety Bill and the Data Protection and Digital Information Bill—to say that children should have special protection in data protection law. As the noble Baroness, Lady Kidron, says, we need to move on from the AADC. That was a triumph she gained during the passage of the Data Protection Act 2018, but six years later the world looks very different and young people need protection from AI models of the kind she has set out in Amendment 137. I agree with the noble Lord, Lord Stevenson, that we need to talk these things through. If it produces an amendment to this Bill that is agreed, all well and good, but it could mean an amendment or part of a new AI Bill when that comes forward. Either way, we need to think constructively in this area because protection of children in the face of generative AI models, in particular, is extremely important.
This group, looking forward to further harms that could be caused by AI, is extremely important on how we can mitigate them in a number of different ways, despite the fact that these amendments appear to deal with quite a disparate group of issues.
Viscount Camrose (Con)
My Lords, I too thank all noble Lords for their insightful contributions to this important group of amendments, even if some of them bemoaned the fact that they have had to repeat themselves over the course of several Bills. I am also very heartened to see how many people have joined us for Committee today. I have been involved in only two of these sittings, but this is certainly a record, and on present trends it is going to be standing room only, which is all to the good.
I have two observations before I start. First, we have to acknowledge that perhaps this area is among the most important we are going to discuss. The rights and protections of data subjects, particularly children, are in many ways the crux of all this and we have to get it right. Secondly, I absolutely take on board that there is a real appetite to get ahead of something around AI legislation. I have an amendment I am very excited about later when we come particularly to ADM, and there will be others as well, but I absolutely take on board that we need to get going on that.
Amendment 92 in the names of the noble Viscount, Lord Colville, and the noble Lord, Lord Clement-Jones, seeks to reduce the likelihood of the misuse of Clause 77 by AI model developers who may seek to claim that they do not need to notify data subjects of reuse for scientific purposes under that clause. This relates to the way that personal data is typically collected and processed for AI development. Amendment 93 similarly seeks to reduce the possibility of misuse of Clause 77 by model developers who could claim they do not need to notify data subjects of reuse for scientific purposes. Amendment 101 also claims to address the potential misuse of Clause 77 by the developers, as does Amendment 105. I strongly support the intent of amendments from the noble Viscount, Lord Colville, and the noble Lord, Lord Clement-Jones, in seeking to maintain and make provisions for the rights and protections of data subjects, and look forward very much to hearing the views of the Minister.
I turn to Amendment 137 in the names of the noble Lords, Lord Russell and Lord Stevenson, and the noble Baronesses, Lady Kidron and Lady Harding. This amendment would require the commissioner to prepare and produce a code of practice which ensures that data processors prioritise the interests, rights and freedoms of children. It goes without saying that the rights and protection of children are of utmost importance. Certainly, this amendment looks to me not only practical but proportionate, and I support it.
Finally, Amendment 211A in the name of my noble friend Lord Holmes ensures the prohibition of
“the development, deployment, marketing and sale of data related to an individual’s image, likeness or personality for AI training”
without that person’s consent. Like the other amendments in this group, this makes provision to strengthen the rights and protections of data subjects against the potential misuse or sale of data and seems entirely sensible. I am sure the Minister has listened carefully to all the concerns powerfully raised from all sides of the Committee today. It is so important that we do not lose sight of the importance of the rights and protection of data subjects.
Baroness Jones of Whitchurch (Lab)
My Lords, I thank the noble Viscount, Lord Colville, and the noble Baroness, Lady Kidron, for their amendments and consideration of this policy area. I hope noble Lords will bear with me if I save some of the points I shall make on web crawling and intellectual property for the later group, which is specifically on that topic.
Amendments 92 and 93 from the noble Viscount are about the new disproportionate effort exemption in Article 13. I can reassure noble Lords that this exemption applies only when data is collected directly from the data subject, so it cannot be used for web crawling, which is, if you like, a secondary activity. I think that answers that concern.
Amendments 101 and 105, also from the noble Viscount, are about the changes to the existing exemption in Article 14, where data is collected from other sources. Noble Lords debated this issue in the previous group, where Amendments 97 and 99 sought to remove this exemption. The reassurances I provided to noble Lords in that debate about the proportionality test being a case-by-case exercise also apply here. Disproportionate effort cannot be used as an excuse; developers must consider the rights of the data subject on each occasion.
I also draw noble Lords’ attention to another quote from the ICO itself, made when publishing its recent outcome reports. I know I have already said that I will share more information on this. It says:
“Generative AI developers, it’s time to tell people how you’re using their information”.
The ICO is on the case on this issue, and is pursuing it.
On Amendment 137 from the noble Baronesses, Lady Kidron and Lady Harding, and other noble Lords, I fully recognise the importance of organisations receiving clear guidance from regulators, especially on complex and technical issues. AI is one such issue. I know that noble Lords are particularly conscious of how it might affect children, and I am hearing the messages about that today.
As the noble Baroness will know, the Secretary of State already has the power to request statutory codes such as this from the regulator. The existing power will allow us to ensure the correct scope of any future codes, working closely with the ICO and stakeholders and including noble Lords here today, and I am happy to meet them to discuss this further. The Government are, naturally, open to evidence about whether new statutory codes should be provided for by regulations in future. Although I appreciate the signal this can send, at the moment I do not believe that a requirement for codes on this issue is needed in this legislation. I hope noble Lords are reassured that the Government are taking this issue seriously.
Amendment 211A from the noble Lord, Lord Holmes, is about prohibiting the processing of people’s names, facial images, voices or any physical characteristics for AI training without their consent. Facial images and other physical characteristics that can be used to identify a person are already protected by the data protection legislation. An AI developer processing such data would have to identify a lawful ground for this. Consent is not the only option available, but I can reassure the noble Lord that there are firm safeguards in place for all the lawful grounds. These include, among many other things, making sure that the processing is fair and transparent. Noble Lords will know that even more stringent conditions, such as safeguards applying in relation to race, sexual orientation and any biometric data that can be used to identify someone as types of a special category of data are also covered.
Noble Lords tried to tempt me once again on the timetable for the AI legislation. I said as much as I could on that when we debated this in the last session, so I cannot add any more at this stage.
I hope that reassures noble Lords that the Bill has strong protections in place to ensure responsible data use and reuse, and, as such, that they feel content not to press their amendments.
Baroness Kidron (CB)
I understand the point that the Secretary of State has the power, but does he have the intention? We are seeking an instruction to the ICO to do exactly this thing. The Secretary of State’s intention would be an excellent compromise all round to activate such a thing, and to see that in the Bill is the point here.
Baroness Jones of Whitchurch (Lab)
Discussions with the ICO are taking place at the moment about the scope and intention of a number of issues around AI, and this issue would be included in that. However, I cannot say at the moment that that intention is specifically spelled out in the way that the noble Baroness is asking.
Viscount Colville of Culross (CB)
This has been a wide-ranging debate, with important contributions from across the Committee. I take some comfort from the Minister’s declaration that the exemptions will not be used for web crawling, but I want to make sure that they are not used at the expense of the privacy and control of personal data belonging to the people of Britain.
That seems particularly so for Amendment 137 in the name of the noble Baroness, Lady Kidron. I was particularly taken by her pointing out that children’s data privacy had not been taken into account when it came to AI, reinforced by the noble Baroness, Lady Harding, telling us about the importance of the Bill. She said it was paramount to protect children in the digital age and reminded us that this is the biggest breakthrough of our lifetime and that children need protecting from it. I hope very much that there will be some successful meetings, and maybe a government amendment on Report, responding to these passionate and heartfelt demands. On that basis, I sincerely hope the Minister will meet us all and other noble Lords to discuss these matters of data privacy further. On that basis, I beg leave to withdraw my amendment.
Member’s explanatory statement
This amendment would clarify that only one condition under paragraph 5 must be present for paragraphs 1 to 4 to not apply.
Baroness Harding of Winscombe (Con)
My Lords, I was in such a hurry to apologise just now for missing Second Reading that I forgot to declare my interests and remind the Committee of my technology and, with regard to this group, charitable interests as set out in the register.
I shall speak to Amendments 95, 96, 98, 101, 102 and 104 in my name and those of the noble Lords, Lord Clement-Jones and Lord Stevenson of Balmacara, and my noble friend Lord Black of Brentwood, and Amendments 103 and 106 in my name and those of the noble Lords, Lord Clement-Jones and Lord Stevenson. I also support Amendment 162 in the name of the noble Lord, Lord Clement-Jones. I will speak only on the marketing amendments in my name and leave the noble Lord, Lord Clement-Jones, to do, I am sure, great justice to the charitable soft opt-in.
These amendments are nothing like as philosophical and emotive as the last amendment on children and AI. They aim to address a practical issue that we debated in the late spring on the Data Protection and Digital Information Bill. I will not rehearse the arguments that we made, not least because the Minister was the co-signatory of those amendments, so I know she is well versed in them.
Instead, I shall update the Committee on what has happened since then and draw noble Lords’ attention to a couple of the issues that are very real and present now. It is strange that all Governments seem reluctant to restrict the new technology companies’ use of our data but extremely keen to get into the micro detail of restricting older forms of our using data that we have all got quite used to.
That is very much the case for the open electoral register. Some 63% of people opt out of being marketed at, because they have put their name as such on the electoral register. This is a well known and well understood use of personal data. Yet, because of the tribunal ruling, it is increasingly the case that companies cannot use the open electoral register and target the 37% of people who have said that they are quite happy to receive marketing unless the company lets every single one of those users know that they are about to market to them. The danger is that we create a new cookie problem—a physical cookie problem—where, if you want to use a data source that has been commonplace for 40 years, you have to send some marketing to tell people that you are about to use it. That of course means that you will not do so, which means that you reduce the data available to a lot of small and medium-sized businesses to market their products and hand them straight to the very big tech companies, which are really happy to scrape our data all over the place.
This is a strange one, where I find myself arguing that we should just allow something that is not broken not to need to be fixed. I appreciate that the Minister will probably tell us that the wording in these amendments is not appropriate. As I said earlier in the year—in April, in the previous incarnation—I very much hope that if the wording is incorrect we could, between Committee and Report, have a discussion and agree on some wording that achieves what seems just practical common sense.
The tribunal ruling that created this problem recognised that it was causing a problem. It stated that it accepted that the loophole it created would allow one company, Experian, a sizeable competitive advantage. It is a slightly perverse one: it means that it has to let only 5 million people know that it might be about to use the open electoral register, while its competitors have to let 22 million people know. That just does not pass the common-sense test of practical use of data. Given the prior support that the Minister has shown for this issue, I very much hope that we can resolve it between Committee and Report. I beg to move.
Lord Lucas (Con)
My Lords, I have a couple of amendments in this group, Amendments 158 and 161. Amendment 158 is largely self-evident; it tries to make sure that, where there is a legal requirement to communicate, that communication is not obstructed by the Bill. I would say much the same of Amendment 161; that, again, it is obvious that there ought to be easy communication where a person’s pension is concerned and the Bill should not obstruct it. I am not saying that these are the only ways to achieve these things, but they should be achieved.
I declare an interest on Amendment 160, in that I control the website of the Good Schools Guide, which has advertising on it. The function of advertising on the web is to enable people to see things for free. It is why it does not close down to a subscription-only service. If people put advertisements on the web, they want to know that they are effective and have been seen, and some information about who they have been seen by. I moved a similar amendment to the previous Government’s Bill and encountered some difficulty. If the Government are of the same mind—that this requires us to be careful—I would very much welcome the opportunity of a meeting between now and Report, and I imagine others would too, to try to understand how best to make sure that advertising can flourish on the internet.
Lord Clement-Jones (LD)
My Lords, I welcome the amendments spoken to so well by the noble Baroness, Lady Harding, regarding the open electoral register. They are intended to provide legal certainty around the use of the register, without compromising on any aspect of the data privacy of UK citizens or risking data adequacy. The amendments specify that companies are exempt from the requirement to provide individuals with information in cases where their personal data has not been obtained directly from them if that data was obtained from the open electoral register. They also provide further clarification on what constitutes “disproportionate effort” under new paragraph 5(e) of Article 14 of GDPR.
The noble Baroness covered the ground so effectively that all I need to add is that the precedent established by the current interpretation by the tribunal will affect not only the open electoral register but other public sources of data, including the register of companies, the Registry of Judgments, Orders and Fines, the Land Registry and the Food Standards Agency register. Importantly, it may even prevent the important work being done to create a national data library achieving its objectives of public sector data sharing. It will have far-reaching implications if we do not change the Bill in the way that the noble Baroness has put forward.
I thank the noble Lord, Lord Lucas, for his support for Amendment 160. I reciprocate in supporting—or, at least, hoping that we get clarification as a result of—his Amendments 158 and 161.
Amendment 159B seeks to ban what are colloquially known as cookie paywalls. As can be seen, it is the diametric opposite to Amendment 159A, tabled by the noble Viscount, Lord Camrose. For some unaccountable reason, cookie paywalls require a person who accesses a website or app to pay a fee to refuse consent to cookies being accessed from or stored on their device. Some of these sums can be extortionate and exorbitant, so I was rather surprised by the noble Viscount’s counter amendment.
Earlier this year, the Information Commissioner launched a call for views which looked to obtain a range of views on its regulatory approach to consent or pay models under data protection law. The call for views highlighted that organisations that are looking to adopt, or have already adopted, a consent-or-pay model must consider the data protection implications.
Cookie paywalls are a scam and reduce people’s power to control their data. I wonder why someone must pay if they do not consent to cookies being stored or accessed. The PEC regulations do not currently prohibit cookie paywalls. The relevant regulation is Regulation 6, which is due to be substituted by Clause 111, and is supplemented by new Schedule A1 to the PEC regulations, as inserted by Schedule 12 to the Bill. The regulation, as substituted by Clause 111 and Schedule 12, does not prohibit cookie paywalls. This comes down to the detail of the regulations, both as they currently are and as they will be if the Bill remains as drafted. It is drafted in terms that do not prevent a person signifying lack of consent to cookies, and a provider may add or set controls—namely, by imposing requirements—for how a person may signify that lack of consent. Cookie paywalls would therefore be completely legal, and they certainly have proliferated online.
This amendment makes it crystal clear that a provider must not require a person to pay a fee to signify lack of consent to their data being stored or accessed. This would mean that, in effect, cookie paywalls would be banned.
Amendment 160 is sought by the Advertising Association. It seeks to ensure that the technical storage of or access to information is considered necessary under paragraph 5 of the new Schedule A1 to the PEC regulations inserted by Schedule 12 if it would support measurement or verification of the performance of advertising services to allow website owners to charge for their advertising services more accurately. The Bill provides practical amendments to the PEC regulations through listing the types of cookies that no longer require consent.
This is important, as not all cookies should be treated the same and not all carry the same high-level risks to personal privacy. Some are integral to the service and the website itself and are extremely important for subscription-free content offered by publishers, which is principally funded by advertising. Introducing specific and target cookie exemptions has the benefit of, first, simplifying the cookie consent banner, and, secondly, increasing further legal and economic certainty for online publishers. As I said when we debated the DPDI Bill, audience measurement is an important function for media owners to determine the consumption of content, to be able to price advertising space for advertisers. Such metrics are crucial to assess the effectiveness of a media channel. For sites that carry advertising, cookies are used to verify the delivery and performance of a digital advertisement—ie, confirmation that an ad has been served or presented to a user and whether it has been clicked on. This is essential information to invoice an advertiser accurately for the number of ad impressions in a digital ad campaign.
My reading of the Bill suggests that audience measurement cookies would be covered under the list of exemptions from consent under Schedule 12, however. Can the Government confirm this? Is it the Government’s intention to use secondary legislation in future to exempt ad performance cookies?
Coming to Amendment 162 relating to the soft opt-in, I am grateful to the noble Lord, Lord Black of Brentwood, and the noble Baroness, Lady Harding of Winscombe, for their support. This amendment would enable charities to communicate to donors in the same way that businesses have been able to communicate to customers since 2003. The clause will help to facilitate greater fundraising and support the important work that charities do for society. I can do no better than quote from the letter that was sent to Secretary of State Peter Kyle on 25 November, which was co-ordinated by the DMA and involved nearly 20 major charities, seeking support for reinstating the original Clause 115 of the DPDI Bill into this Bill:
“Clause 115 of the previous DPDI Bill extended the ‘soft opt-in’ for email marketing for charities and non-commercial organisations. The DMA estimates that extending the soft opt-in to charities would increase annual donations in the UK by £290 million”,
based on analysis of 13.1 million donors by the Salocin Group. The letter continues:
“At present, the DUA Bill proposals remove this. The omission of the soft opt-in will prevent charities from being able to communicate to donors in the same way as businesses can. As representatives of both corporate entities and charitable organisations, it is unclear to the DMA why charities should be at a disadvantage in this regard”.
I hope that the Government will listen to the DMA and the charities involved.
Viscount Camrose (Con)
I thank noble Lords for their comments and contributions. I shall jump to Amendments 159 and 159A, one of which is in my name and both of which are concerned with cookie paywalls. I am not sure I can have properly understood the objection to cookie paywalls. Do they not simply offer users three choices: pay money and stay private; share personal data and read for free; or walk away? So many times, we have all complained about the fact that these websites harvest our data and now, for the first time, this approach sets a clear cash value on the data that they are harvesting and offers us the choice. The other day somebody sent me a link from the Sun. I had those choices. I did not want to pay the money or share my data, so I did not read the article. I feel this is a personal decision, supported by clear data, which it is up to the individual to take, not the Government. I do not think we should take away this choice.
Let me turn to some of the other amendments in this group. Amendment 161 in the name of my noble friend Lord Lucas is, if I may say so, a thoughtful amendment. It would allow pension providers to communicate information on their product. This may mean that the person who will benefit from that pension does not miss out on useful information that would benefit their saving for retirement. Given that pension providers already hold the saver’s personal data, it seems to be merely a question of whether this information is wanted; of course, if it is not, the saver can simply opt out.
Amendment 162 makes an important point: many charities rely on donations from the public. Perhaps we should consider bringing down the barriers to contacting people regarding fundraising activities. At the very least, I am personally not convinced that members of the public have different expectations around what kinds of organisation can and cannot contact them and in what circumstances, so I support any step that simplifies the—to my mind—rather arbitrary differences in the treatment of business and charity communications.
Amendment 104 certainly seems a reasonable addition to the list of what might constitute “unreasonable effort” if the information is already public. However, I have some concerns about Amendments 98 and 100 to 103. For Amendment 98, who would judge the impact on the individual? I suspect that the individual and the data controllers may have different opinions on this. In Amendment 100, the effort and cost of compliance are thorny issues that would surely be dictated by the nature of the data itself and the reason for providing it to data subjects. In short, I am concerned that the controllers’ view may be more subjective than we would want.
On Amendment 102, again, when it comes to providing information to them,
“the damage and distress to the data subjects”
is a phrase on which the subject and the controller will almost inevitably have differing opinions. How will these be balanced? Additionally, one might presume that information that is either damaging or distressing to the data subjects should not necessarily be withheld from them as it is likely to be extremely important.
Baroness Jones of Whitchurch (Lab)
My Lords, we have covered a range of issues in our debate on this grouping; nevertheless, I will try to address each of them in turn. I thank the noble Lord, Lord Clement-Jones, and the noble Baroness, Lady Harding, for their Amendments 95, 96, 98, 100, 102 to 104 and 106 regarding notification requirements.
First, with regard to the amendments in the name of the noble Baroness, Lady Harding, I say that although the Government support the use of public data sources, transparency is a key data protection principle. We do not agree that such use of personal data should remove or undermine the transparency requirements. The ICO considers that the use and sale of open electoral register data alone is likely not to require notification. However, when the data is combined with data from other sources, in order to build an extensive profile to be sold on for direct marketing, notification may be proportionate since the processing may go beyond the individual’s reasonable expectations. When individuals are not notified about processing, it makes it harder for them to exercise their data subject rights, such as the right to object.
Adding other factors to the list of what constitutes a “disproportionate effort” for notification is unnecessary given that the list is already non-exhaustive. The “disproportionate effort” exemption must be applied according to the safeguards of the wider data protection framework. According to the fairness principle, controllers should already account for whether the processing meets the reasonable expectations of a data subject. The data minimisation and purpose limitation principles also act as an important consideration for data controllers. Controllers should continue to assess on a case-by-case basis whether they meet the threshold for the existing exemptions to notify; if not, they should notify. I hope that this helps clarify our position on that.
Lord Clement-Jones (LD)
When does the Minister anticipate that the ICO will produce that report?
Baroness Jones of Whitchurch (Lab)
I do not have the detail of all that. Obviously, the call for views has only recently gone out and he will need time for consideration of the responses. I hope the noble Lord will accept that the ICO is on the case on this matter. If we can provide more information, we will.
Lord Clement-Jones (LD)
May I ask the Minister a hypothetical question? If the ICO believes that these are not desirable, what instruments are there for changing the law? Can the ICO, under its own steam, so to speak, ban them; do we need to do it in primary legislation; or can it be done in secondary legislation? If the Minister cannot answer now, perhaps she can write to me.
Baroness Jones of Whitchurch (Lab)
Of course I will write to the noble Lord. It will be within the ICO’s normal powers to make changes where he finds that they are necessary.
I move to Amendment 160, tabled by noble Lord, Lord Lucas, which seeks to create a new exemption for advertising performance cookies. There is a balance to strike between driving growth in the advertising, news and publishing sectors while ensuring that people retain choice and control over how their data is used. To exempt advertising measurement cookies, we would need to assess how intrusive these cookies are, including what they track and where data is sent. We have taken a delegated power so that exemptions to the prohibition can be added in future once evidence supports it, and we can devise appropriate safeguards to minimise privacy risks. In the meantime, we have been actively engaging with the advertising and publishing sectors on this issue and will continue to work with them to consider the potential use of the regulation-making power. I hope that the noble Lord will accept that this is work in progress.
Amendment 161, also from the noble Lord, Lord Lucas, aims to extend the soft opt-in rule under the privacy and electronic communications regulations to providers of auto-enrolment pension schemes. The soft opt-in rule removes the need for some commercial organisations to seek consent for direct marketing messages where there is an existing relationship between the organisation and the customer, provided the recipient did not object to receiving direct marketing messages when their contact details were collected.
The Government recognise that people auto-enrolled by their employers in workplace pension schemes may not have an existing relationship with their pension provider, so I understand the noble Lord’s motivations for this amendment. However, pension providers have opportunities to ask people to express their direct mail preferences, such as when the customer logs on to their account online. We are taking steps to improve the support available for pension holders through the joint Government and FCA advice guidance boundary review. The FCA will be seeking feedback on any interactions of proposals with direct marketing rules through that consultation process. Again, I hope the noble Lord will accept that this issue is under active consideration.
Amendment 162, tabled by the noble Lord, Lord Clement-Jones, would create an equivalent provision to the soft opt-in but for charities. It would enable a person to send electronic marketing without permission to people who have previously expressed an interest in their charitable objectives. The noble Lord will recall, and has done so, that the DPDI Bill included a provision similar to his amendment. The Government removed it from that Bill due to the concerns that it would increase direct marketing from political parties. I think we all accepted at the time that we did not want that to happen.
As the noble Lord said, his amendment is narrower because it focuses on communications for charitable purposes, but it could still increase the number of messages received by people who have previously expressed an interest in the work of charities. We are listening carefully to arguments for change in this area and will consider the points he raises, but I ask that he withdraws his amendment while we consider its potential impact further. We are happy to have further discussions on that.
Baroness Stowell of Beeston (Con)
I apologise to the Minister for intervening on her when I have not spoken earlier in this debate, but I was reassured by what she just said on Amendment 162. Remarks made by other noble Lords in this debate suggest both that members of the public might not object to charities having the same access rights as businesses and that the public do not necessarily draw a distinction between businesses and charities. As a former chairman of the Charity Commission, I can say that that is not what is generally found. People have an expectation of charities that differs from what they would expect by way of marketing from businesses. In considering this amendment, therefore, I urge the Minister to think carefully before deciding what action the Government should take.
Baroness Jones of Whitchurch (Lab)
I thank the noble Baroness very much for that very helpful intervention. If she has any more information about the view of the Charity Commission, we would obviously like to engage with that because we need to get this right. We want to make sure that individuals welcome and appreciate the information given to them, rather than it being something that could have a negative impact.
I think I have covered all the issues. I hope those explanations have been of some reassurance to noble Lords and that, as such, they are content not to press their amendments.
Baroness Harding of Winscombe (Con)
May I just follow up by asking one quick question? I may be clutching at straws here but, in responding to the amendments in my name, she stated what the ICO believes rather than what the Government believe. She also said that the ICO may think that further permission is required to ensure transparency. I understand from the Data & Marketing Association that users of this data have four different ways of ensuring transparency. Would the Minister agree to a follow-up meeting to see whether there is a meeting of minds with what the Government think, rather than the ICO?
Baroness Jones of Whitchurch (Lab)
I am very happy to talk to the noble Baroness about this issue. She asked what the Government’s view is; we are listening very carefully to the Information Commissioner and the advice that he is putting together on this issue.
Lord Lucas (Con)
My Lords, I am very grateful for the answers the noble Baroness gave to my amendments. I will study carefully what she said in Hansard, and if I have anything further to ask, I will write to her.
Baroness Harding of Winscombe (Con)
My Lords, in response—and very briefly, given the technical nature of all these amendments—I think that we should just note that there are a number of different issues in this group, all of which I think noble Lords in this debate will want to follow up. I thank the many noble Lords who have contributed both this time round and in the previous iterations, and ask that we follow up on each of the different issues, probably separately rather than in one group, as we will get ourselves quite tangled in the web of data if we are not careful. With that, I beg leave to withdraw the amendment.
Lord Clement-Jones
Member’s explanatory statement
This amendment is consequential on the new Clause (Transfer of jurisdiction of courts to tribunals).
Lord Clement-Jones (LD)
My Lords, in moving Amendment 108, I will also speak to all the other amendments in this group. They are all designed to transfer all existing provisions from the courts to the tribunals and simplify the enforcement of data rights. Is that not something to be desired? This is not just a procedural change but a necessary reform to ensure that the rights granted on paper translate into enforceable rights in reality.
The motivation for these amendments stems from recurring issues highlighted in cases such as Killock and Veale v the Information Commissioner, and Delo v the Information Commissioner. These cases revealed a troubling scenario where the commissioner presented contradictory positions across different levels of the judiciary, exacerbating the confusion and undermining the credibility of the regulatory framework governing data protection. In these cases, the courts have consistently pointed out the confusing division of jurisdiction between different courts and tribunals, which not only complicates the legal process but wastes considerable public resources. As it stands, individuals often face the daunting task of determining the correct legal venue for their claims, a challenge that has proved insurmountable for many, leading to denied justice and unenforced rights.
By transferring all data protection provisions from the courts to more specialised tribunals, which are better equipped to handle such cases, and clarifying the right-to-appeal decisions made by the commissioner, these amendments seek to eliminate unnecessary legal barriers. Many individuals, often representing themselves and lacking legal expertise, face the daunting challenge of navigating complex legal landscapes, deterred by high legal costs and the intricate determination of appropriate venues for their claims. This shift will not only reduce the financial burden on individuals but enhance the efficiency and effectiveness of the judicial process concerning data protection. By simplifying the legal landscape, we can safeguard individual rights more effectively and foster a more trustworthy digital environment.
Lord Holmes of Richmond (Con)
My Lords, I rise briefly to support my friend, the noble Lord, Lord Clement-Jones, and his string of amendments. He made the case clearly: it is simply about access, the right to redress and a clear pathway to that redress, a more efficient process and clarity and consistency across this part of our data landscape. There is precious little point in having obscure remedies or rights—or even, in some cases, as we have discussed in our debates on previous groups, no right or obvious pathways to redress. I believe that this suite of amendments addresses that issue. Again, I full-throatedly support them.
Viscount Camrose (Con)
My Lords, I address the amendments tabled by the noble Lord, Lord Clement-Jones. These proposals aim to transfer jurisdiction from courts to tribunals; to establish a new right of appeal against decisions made by the Information Commissioner; and to grant the Lord Chancellor authority to implement tribunal procedure rules. I understand and recognise the noble Lord’s intent here, of course, but I have reservations about these amendments and urge caution in accepting them.
The suggestion to transfer jurisdiction from courts to tribunals raises substantial concerns. Courts have a long-standing authority and expertise in adjudicating complex legal matters, including data protection cases. By removing these disputes from the purview of the courts, the risk is that we undermine the depth and breadth of legal oversight required in such critical areas. Tribunals, while valuable for specialised and expedited decisions, may not provide the same level of rigorous legal analysis.
Cases such as those cited by the noble Lord, Lord Clement-Jones—Killock and another v the Information Commissioner and Delo v the Information Commissioner—demonstrate to me the intricate interplay between data protection, administrative discretion and broader legal principles. It is questionable whether tribunals, operating under less formal procedures, can consistently handle such complexities without diminishing the quality of justice. Further, I am not sure that the claim that this transfer will streamline the system and reduce burdens on the courts is fully persuasive. Shifting cases to tribunals does not eliminate complexity; it merely reallocates it, potentially at the expense of the detailed scrutiny that these cases demand.
I turn to the right of appeal against the commissioner’s decisions. Although the introduction of a right of appeal against these decisions may seem like a safeguard, it risks creating unnecessary layers of litigation. The ICO already operates within a robust framework of accountability, including judicial review for cases of legal error or improper exercise of discretion. Adding a formal right of appeal risks encouraging vexatious challenges, overwhelming the tribunal system and diverting resources from addressing genuine grievances.
I think we in my party understand the importance of regulatory accountability. However, creating additional mechanisms should not come at the expense of efficiency and proportionality. The existing legal remedies are designed to strike an appropriate balance, and further appeals risk creating a chilling effect on the ICO’s ability to act decisively in protecting data rights.
On tribunal procedure rules and centralised authority, the proposed amendment granting the Lord Chancellor authority to set tribunal procedure rules bypasses the Tribunal Procedure Committee, an independent body designed to ensure that procedural changes are developed with judicial oversight. This move raises concerns about the concentration of power and the erosion of established checks and balances. I am concerned that this is a case of expediency overriding the principles of good governance. While I acknowledge that consultation with the judiciary is included in the amendment, it is not a sufficient substitute for the independent deliberative processes currently in place. The amendment risks undermining the independence of our legal institutions and therefore I have concerns about it.
These amendments overall, while presented as technical fixes, and certainly I recognise the problem and the intent, would have far-reaching consequences for our data protection framework. The vision of my party for governance is one that prioritises stability, legal certainty and the preservation of integrity. We must avoid reforms that, whatever their intent, introduce confusion or inefficiency or undermine public trust in our system. Data protection is, needless to say, a cornerstone of our modern economy and individual rights. As such, any changes to its governance must be approached with the utmost care.
The Minister of State, Department for Science, Innovation and Technology (Lord Vallance of Balham) (Lab)
I thank the noble Lord, Lord Clement-Jones, for his Amendments 108, 146 to 153 and 157, and I am grateful for the comments by the noble Lord, Lord Holmes, and the noble Viscount, Lord Camrose.
The effect of this group of amendments would be to make the First-tier Tribunal and the Upper-tier Tribunal responsible for all data protection cases. They would transfer ongoing as well as future cases out of the court system to the relevant tribunals and, as has been alluded to, may cause more confusion in doing so.
As the noble Lord is aware, there is currently a blend of jurisdiction under the data protection legislation for both tribunals and courts according to the nature of the proceedings in question. This is because certain types of cases are appropriate to fall under tribunal jurisdiction while others are more appropriate for court settings. For example, claims by individuals against organisations for breaches of legal requirements can result in awards of compensation for the individuals and financial and reputational damage for the organisations. It is appropriate that such cases are handled by a court in conformance with their strict procedural and evidential rules. Indeed, under the Killock and Delo examples, it was noted that there could be additional confusion in that ability to go between those two possibilities if you went solely to one of the tribunals.
On the transfer of responsibility for making tribunal procedural rules from the Tribunal Procedure Committee to the Lord Chancellor, we think that would be inappropriate. The committee is comprised of legal experts appointed or nominated by senior members of the judiciary or the Lord Chancellor. This committee is best placed to make rules to ensure that tribunals are accessible and fair and that cases are dealt with quickly and efficiently. It keeps the rules under constant review to ensure that they are fit for purpose in line with new appeal rights and the most recent legislative changes.
Amendment 151 would also introduce a statutory appeals procedure for tribunals to determine the merits of decisions made by the Information Commissioner. Data subjects and controllers alike can already challenge the merits of the Information Commissioner’s decisions by way of judicial review in a way that would preserve the discretion and independence of the Information Commissioner’s decision-making, so no statutory procedure is needed. The Government therefore believe that the current jurisdictional framework is well-balanced and equitable, and that it provides effective and practical routes of redress for data subjects and controllers as well as appropriate safeguards to ensure compliance by organisations. For these reasons, I hope the noble Lord will not press his amendments.
Lord Clement-Jones (LD)
My Lords, I thank the Minister for his response to my amendments and welcome him to the Dispatch Box and a whole world of pain on the Data (Use and Access) Bill, as he has, no doubt, noted already after just two hours’ worth of this Committee.
I found his response disappointing, and I think both he and the noble Viscount, Lord Camrose, have misunderstood the nature of this situation. This is not a blend, which is all beautifully logical depending on the nature of the case. This is an absolute mishmash where the ordinary litigant is faced with great confusion, not knowing quite often whether to go to the court or a tribunal, where the judges themselves have criticised the confusion and where there appears to be no appetite, for some reason, in government for a review of the jurisdictions.
I felt that the noble Viscount was probably reading from his previous ministerial brief. Perhaps he looked back at Hansard for what he said on the DPDI Bill. It certainly sounded like that. The idea that the courts are peerless in their legal interpretation and the poor old tribunals really just do not know what they are doing is wrong. They are expert tribunals, you can appear before them in person and there are no fees. It is far easier to access a tribunal than a court and certainly, as far as appeals are concerned, the idea that the ordinary punter is going to take judicial review proceedings, which seems to be the implication of staying with the current system on appeals if the merits of the ICO’s decisions are to examined, seems quite breathtaking. I know from legal practice that JR is not cheap. Appearing before a tribunal and using that as an appeal mechanism would seem far preferable.
I will keep on pressing this because it seems to me that at the very least the Government need to examine the situation to have a look at what the real objections are to the jurisdictional confusion and the impact on data subjects who wish to challenge decisions. In the meantime, I beg leave to withdraw the amendment.
Lord Clement-Jones
“3. To qualify as meaningful human involvement, the review must be performed by a person with the necessary competence, training, authority to alter the decision and analytical understanding of the data.”Member's explanatory statement
This amendment would make clear that in the context of new Article 22A of the UK GDPR, for human involvement to be considered as meaningful, the review must be carried out by a competent person.
Lord Clement-Jones (LD)
My Lords, I beg to move Amendment 110 and will speak to Amendments 112, 114, 120, 121, 122, 123 and Clause 80 stand part. As we have heard, artificial intelligence and algorithmic and automated decision-making tools, are increasingly being used across the public sector to make and support many of the highest impact decisions affecting individuals, families and communities across healthcare, welfare, education, policing, immigration and many other sensitive areas of an individual’s life.
The Committee will be pleased to hear that I will not repeat the contents of my speech on my Private Member’s Bill on this subject last Friday. But the fact remains that the rapid adoption of AI in the public sector presents significant risks and challenges, including: the potential for unfairness, discrimination and misuse, as demonstrated by scandals such as the UK’s Horizon and Australia’s Robodebt cases; automated decisions that are prone to serious error; lack of transparency and accountability in automated decision-making processes; privacy and data protection concerns; algorithmic bias; and the need for human oversight.
Viscount Colville of Culross (CB)
My Lords, Amendment 119 is in my name, and I thank the noble Lord, Lord Knight, for adding his name to it. I am pleased to add my name to Amendment 115A in the name of noble Viscount, Lord Camrose.
Transparency is key to ensuring that the rollout of ADM brings the public and, most importantly, public trust with it. I give the Committee an example of how a lack of transparency can erode that trust. The DWP is using a machine learning model to analyse all applications for a loan, as an advance on a benefit to pay bills and other costs, while a recipient waits for their first universal credit payment. The DWP’s own analysis of the model concluded that for all of the protected characteristics that were analysed, including age, marital status and disability, it found disparities in who was most likely to be incorrectly referred by the model.
It is difficult to assess whether the model is discriminatory, effective or even lawful. When the DWP rolled it out, it was unable to reassure the Comptroller and Auditor-General that its anti-fraud models treated all customer groups fairly. The rollout continues despite these concerns. The DWP maintains that the analysis does not present
“any immediate concerns of discrimination, unfair treatment or detrimental impact on customers”.
However, because so little information is available about the model, this claim cannot be independently verified to provide the public with confidence. Civil rights organisations, including the Public Law Project, are currently working on a potential claim against the DWP, including in relation to this model, on the basis that they may consider it may be unlawful.
The Government’s commitment to rolling out ADM has been accompanied by a statement in the other place in November by AI Minister Feryal Clark that the mandatory requirement for the use of the ATRS has been seen as a significant acceleration towards adopting the standard. In response to a Written Question, the Secretary of State confirmed that, as part of the rollout of ADM phase 1 to the 16 largest ministerial departments plus HMRC, there is a deadline for them to publish their first ATRS records by the end of July 2024. Despite the Government’s statement, only eight ATRS reports have been published on the hub. The Public Law Project’s TAG project has discovered at least 74 areas in which ADM is being used, and they are only the ones that it has been able to uncover by freedom of information requests and from tip-offs by affected people. There is clearly a shortfall in the implementation and rolling out of the use of the ATRS across government departments.
Lord Lucas (Con)
My Lords, my Amendment 115 would similarly act in that way by making automated decision-making processes explain themselves to the people affected by them. This would be a much better way of controlling the quality of what is going on with automated decision-making than restricting that sort of information to professionals—to people who are anyway overworked and have a lot of other things to do. There is no one more interested in the decision of an automated process than the person about whom it is being made. If we are to trust these systems then their ability, which is way beyond the human ability, to have the time to explain why they took the decision they did—which, if the machine is any good, it knows and can easily set out—is surely the way to generate trust: you can absolutely see what decision has been made and why, and you can respond to it.
This would, beyond anything else, produce a much better system for our young people when they apply for their first job. My daughter’s friends in that position are getting into the hundreds of unexplained rejections. This is not a good way to treat young people. It does not help them to improve and understand what is going on. I completely understand why firms do not explain; they have so many applications that they just do not have the time or the personnel to sit down and write a response—but that does not apply to an automated decision-making machine. It could produce a much better situation when it comes to hiring.
As I said, my principal concern, to echo that of the noble Viscount, is that it would give us sight of the decisions that have been taken and why. If it becomes evident that they are taken well and for good reasons, we shall learn to trust them. If it becomes evident that they really are not fair or understandable, we shall be in a position to demand changes.
Lord Holmes of Richmond (Con)
My Lords, it is a pleasure to take part in the debate on this group. I support the spirit of all the amendments debated thus far.
Speaking of spirits, and it being the season, I have more than a degree of sympathy for the Minister. With so many references to her previous work, this Christmas is turning into a bit of the Ghost of Amendments Past for her. That is good, because all the amendments she put down in the past were of an excellent quality, well thought through, equally considered and even-handed.
As has been mentioned many times, we have had three versions of a data Bill so far over just over three years. One wonders whether all the elements of this current draft have kept up with what has happened in the outside world over those three years, not least when it comes to artificial intelligence. This goes to the heart of the amendments in this group on automated decision-making.
When the first of these data Bills emerged, ADM was present—but relatively discreetly present—in our society and our economy. Now it would be fair to say that it proliferates across many areas of our economy and our society, often in situations where people find themselves at the sharpest end of the economy and the sharpest end of these automated decisions, often without even knowing that ADM was present. More than that, even on the discovery that ADM was in the mix, depending on which sector of the economy or society they find that decision being made in, they may find themselves with no or precious little redress—employment and recruitment, to name but one sector.
It being the season, it is high time when it comes to ADM that we start to talk turkey. In all the comments thus far, we are talking not just about ADM but about the principles that should underpin all elements of artificial intelligence—that is, they should be human led. These technologies should be in our human hands, with our human values feeding into human oversight: human in the loop and indeed, where appropriate, human over the loop.
That goes to elements in my two amendments in this group, Amendments 123A and 123B. Amendment 123A simply posits, through a number of paragraphs, the point that if someone is subject to an automated decision then they have the right to a personalised explanation of that decision. That explanation should be accessible in its being in plain language of their choice, not having a cost attached to it and not being in any sense technically or technologically convoluted or opaque. That would be relatively straightforward to achieve, but the positive impact for all those citizens would certainly be more than material.
Amendment 123B goes to the heart of those humans charged with the delivery of these personalised explanations. It is not enough to simply say that there are individuals within an organisation responsible for the provision of personalised explanations for automated decisions; it is critical that those individuals have the training, the capabilities and, perhaps most importantly, the authority within that organisation to make a meaningful impact regarding those personalised explanations. If not, this measure may have a small voice but would have absolutely no teeth when it comes to the citizen.
In short, ADM is proliferating so we need to ensure that we have a symmetrical situation for citizens, for consumers, and for anyone who finds themselves in any domain or sector of our economy and society. We must assert the principles: human-led, human in the loop, “Our decisions, our data”, and “We determine, we decide, we choose”. That is how I believe we can have an effective, positive, enabling and empowering AI future. I look forward to the Minister’s comments.
Lord Knight of Weymouth (Lab)
My Lords, I shall speak to the series of amendments on automated decision-making to which I have added my name but are mostly in the name of the noble Lord, Lord Clement-Jones. As he said, we had a rehearsal for this debate last Friday when we debated his Private Member’s Bill so I will not delay the Committee by saying much about the generalities of ADMs in the public sector.
Suffice it to say that human involvement in overseeing AIs must be meaningful—for example, without those humans themselves being managed by algorithms. We must ensure that ADMs comply by design with the Equality Act and safeguard data subjects’ other rights and freedoms. As discussed in earlier groups, we must pay particular attention to children’s rights with regard to ADMs, and we must reinforce the obligation on public bodies to use the algorithmic transparency recording standards. I also counsel my noble friend the Minister that, as we have heard, there are many voices from civil society advising me and others that the new Article 22 of the GDPR takes us backwards in terms of protection.
That said, I want to focus on Amendment 123C, relating to ADMs in the workplace, to which I was too late to add my name but would have done. This amendment follows a series of probing amendments tabled by me to the former DPDI Bill. In this, I am informed by my work as the co-chair of the All-Party Parliamentary Group on the Future of Work, assisted by the Institute for the Future of Work. These amendments were also mirrored during the passage of the Procurement Act and competition Act to signal the importance of the workplace, and in particular good work, as a cross-cutting objective and lens for policy orientation.
Baroness Kidron (CB)
My Lords, I speak to Amendment 114 to which I have added my name. It is a very simple amendment that prevents controllers circumventing the duties for automated decision-making by adding trivial human elements to avoid the designation. So, as such, it is a very straightforward—and, I would have thought, uncontroversial—amendment. I really hope that the Government will find something in all our amendments to accept, and perhaps that is one such thing.
I am struck that previous speeches have referred to questions that I raised last week: what is the Bill for, who is it for and why is not dealing with a host of overlapping issues that cannot really be extrapolated one from another? In general, a bit like the noble Lord, Lord Holmes, I am very much with the spirit of all these amendments. They reflect the view of the Committee and the huge feeling of civil society—and many lawyers—that this sort of attack on Article 22 by Clause 80 downgrades UK data rights at a time when we do not understand the Government’s future plans and hear very little about protections. We hear about the excitements of AI, which I feel bound to say that we all share, but not at the expense of individuals.
I raise one last point in this group. I had hoped that the Minister would have indicated the Government’s openness to Amendment 88 last week, which proposed an overarching duty on controllers and processors to provide children with heightened protections. That seemed to me the most straightforward mechanism for ensuring that current standards were maintained and then threaded through new situations and technologies as they emerged. I put those two overarching amendments down on the understanding that Labour, when in opposition, was very much for this approach to children. We may need to bring back specific amendments, as we did throughout the Data Protection and Digital Information Bill, including Amendment 46 to that Bill, which sought to ensure
“that significant decisions that impact children cannot be made using automated processes unless they are in a child’s best interest”.
If the Minister does not support an overarching provision, can she indicate whether the Government would be more open to clause-specific carve-outs to protect children and uphold their rights?
Lord Thomas of Cwmgiedd (CB)
My Lords, I rise briefly, first, to thank everyone who has spoken so eloquently about the importance of automated decision-making, in particular its importance to public trust and the importance of human intervention. The retrograde step of watering down Article 22 is to be deplored. I am therefore grateful to the noble Lord, Lord Clement-Jones, for putting forward that this part of the Bill should not stand part. Secondly, the specific amendment that I have laid seeks to retain the broader application of human intervention for automated decision-making where it is important. I can see no justification for that watering down, particularly when there is such uncertainty about the scope that AI may bring to what can be done by automated decision-making.
Lord Kamall (Con)
My Lords, in speaking to this group of amendments I must apologise to the Committee that, when I spoke last week, I forgot to mention my interests in the register, specifically as an unpaid adviser to the Startup Coalition. For Committee, noble Lords will realise that I have confined myself to amendments that may be relevant to our healthcare and improving that.
I will speak to Amendments 111 and 116 in the names of my noble friends Lord Camrose and Lord Markham, and Amendment 115 from my noble friend Lord Lucas and the noble Lords, Lord Clement-Jones and Lord Knight of Weymouth, as well as other amendments, including from my noble friend Lord Holmes—I will probably touch on most amendments in this group. To illustrate my concerns, I return to two personal experiences that I shared during debate on the Data Protection and Digital Information Bill. I apologise to noble Lords who have heard these examples previously, but they illustrate the points being made in discussing this group of amendments.
A few years ago, when I was supposed to be travelling to Strasbourg, my train to the airport got delayed. My staff picked me up, booked me a new flight and drove me to the airport. I got to the airport with my new boarding pass and scanned it to get into the gate area, but as I was about to get on the flight, I scanned my pass again and was not allowed on the flight. No one there could explain why, having been allowed through security, I was not allowed on the flight. To cut a long story short, after two hours of being gaslighted by four or five staff, with them not even saying that they could not explain things to me, I eventually had to return to the check-in desk—this was supposed to be avoided by all the automation—to ask what had happened. The airline claimed that it had sent me an email that day. The next day, it admitted that it had not sent me an email. It then explained what had happened by saying that a flag had gone off in its system. That was simply the explanation.
This illustrates the point about human intervention, but it is also about telling customers and others what happens when something goes wrong. The company clearly had not trained its staff in how to speak to customers or in transparency. Companies such as that airline get away with this sort of disgraceful behaviour all the time, but imagine if such technology were being used in the NHS. Imagine the same scenario: you turn up for an operation, and you scan your barcode to enter the hospital—possibly even the operating theatre—but you are denied access. There must be accountability, transparency and human intervention, and, in these instances, there has to be human intervention immediately. These things are critical.
I know that this Bill makes some sort of differentiation between more critical and less critical ADM, but let me illustrate my point with another example. A few years ago, I paid for an account with one of those whizzy fintech banks. Its slogan was: “We are here to make money work for everyone”. I downloaded the app and filled out the fields, then a message popped up telling me, “We will get back to you within 48 hours”. Two weeks later, I got a message on the app saying that I had been rejected and that, by law, the bank did not have to explain why. Once again, I ask noble Lords to imagine. Imagine Monzo’s technology being used on the NHS app, which many people currently use for repeat prescriptions or booking appointments. What would happen if you tried to book an appointment but you received a message saying, “Your appointment has been denied and, by law, we do not have to explain why”? I hope that we would have enough common sense to ensure that there is human intervention immediately.
I realise that the noble Lord, Lord Clement-Jones, has a Private Member’s Bill on this issue—I am sorry that I have not been able to take part in those debates—but, for this Bill, I hope that the two examples I have just shared illustrate the point that I know many noble Lords are trying to make in our debate on this group of amendments. I look forward to the response from the Minister.
Viscount Camrose (Con)
I thank all noble Lords who have spoken. I must confess that, of all the groups we are looking at today, I have been particularly looking forward to this one. I find this area absolutely fascinating.
Let me begin in that spirit by addressing an amendment in my name and that of my noble friend Lord Markham and I ask the Government and all noble Lords to give it considerable attention. Amendment 111 seeks to insert the five principles set out in the AI White Paper published by the previous Government and to require all those participating in ADM—indeed, all forms of AI—to have due regard for them. They are:
“safety, security and robustness, appropriate transparency and explainability, fairness, accountability and governance, and contestability and redress”.
These principles for safe AI are based on those originally developed with the OECD and have been the subject of extensive consultation. They have been refined and very positively received by developers, public sector organisations, private sector organisations and civil society. They offer real safeguards against the risks of AI while continuing to foster innovation.
I will briefly make three brief points to commend their inclusion in the Bill, as I have described. First, the Bill team has argued throughout that these principles are already addressed by the principles of data protection and so are covered in the Bill. There is overlap, of course, but I do not agree that they are equivalent. Data protection is a significant concern in AI but the risks and, indeed, the possibilities of AI go far further than data protection. We simply cannot entrust all our AI risks to data protection principles.
Secondly, I think the Government will point to their coming AI Bill and suggest that we should wait for that before we move significantly on AI. However, in practice all we have to go on about the Bill—I recognise that Ministers cannot describe much of it now—is that it will focus on the largest AI labs and the largest models. I assume it will place existing voluntary agreements on a statutory footing. In other words, we do not know when the Bill is coming, but this approach will allow a great many smaller AI fish to slip through the net. If we want to enshrine principles into law that cover all use of AI here, this may not quite be the only game in town, but it is certainly the only all-encompassing, holistic game in town likely to be positively impactful. I look forward to the Minister’s comments on this point.
Baroness Jones of Whitchurch (Lab)
My Lords, we have had a really profound and significant debate on these issues; it has been really helpful that they have been aired by a number of noble Lords in a compelling and articulate way. I thank everybody for their contributions.
I have to say at the outset that the Government want data protection rules fit for the age of emerging technologies. The noble Lord, Lord Holmes, asked whether we are addressing issues of the past or issues of the future. We believe that the balance we have in this Bill is exactly about addressing the issues of the future. Our reforms will reduce barriers to the responsible use of automation while clarifying that organisations must provide stringent safeguards for individuals.
I stress again how seriously we take these issues. A number of examples have been quoted as the debate has gone on. I say to those noble Lords that examples were given where there was no human involved. That is precisely what the new provisions in this Bill attempt to address, in order to make sure that there is meaningful human involvement and people’s futures are not being decided by an automated machine.
Amendment 110 tabled by the noble Lords, Lord Clement-Jones and Lord Knight, seeks to clarify that, for human involvement to be meaningful, it must be carried out by a competent person. Our reforms make clear that solely automated decisions lack meaningful human involvement. That goes beyond a tick-box exercise. The ICO guidance also clarifies that
“the human involvement has to be active and not just a token gesture”;
that right is absolutely underpinned by the wording of the regulations here.
I turn next to Amendment 111. I can assure—
Lord Clement-Jones (LD)
My Lords, I was listening very carefully. Does “underpinned by the regulations” mean that it will be underpinned?
Baroness Jones of Whitchurch (Lab)
Yes. The provisions in this Bill cover exactly that concern.
Lord Clement-Jones (LD)
The issue of meaningful human involvement is absolutely crucial. Is the Minister saying that regulations issued by the Secretary of State will define “meaningful human involvement”, or is she saying that it is already in the primary legislation, which is not my impression?
Baroness Jones of Whitchurch (Lab)
Sorry—it is probably my choice of language. I am saying that it is already in the Bill; it is not intended to be separate. I was talking about whether solely automated decisions lack meaningful human involvement. This provision is already set out in the Bill; that is the whole purpose of it.
On Amendment 111, I assure the noble Viscount, Lord Camrose, that controllers using solely automated processing are required to comply with the data protection principles. I know that he was anticipating this answer, but we believe that it captures the principles he proposes and achieves the same intended effect as his amendment. I agree with the noble Viscount that data protection is not the only lens through which AI should be regulated, and that we cannot address all AI risks through the data protection legislation, but the data protection principles are the right ones for solely automated decision-making, given its place in the data protection framework. I hope that that answers his concerns.
On Amendment 112, which seeks to prohibit solely automated decisions that contravene the Equality Act 2010, I assure the noble Lords, Lord Clement-Jones and Lord Knight, that the data protection framework is clear that controllers must adhere to the Equality Act.
Amendments 113 and 114 would extend solely automated decision-making safeguards to predominantly automated decision-making. I assure the noble and learned Lord Thomas, the noble Lord, Lord Clement-Jones, and the noble Baroness, Lady Kidron, that the safeguards in Clause 80 are designed to protect individuals where meaningful human involvement is lacking. Predominantly automated decision-making will already include meaningful human involvement and therefore does not require these additional safeguards.
On Amendments 114A and 115A, tabled by the noble Viscount, Lord Camrose, many noble Lords have spoken in our debates about the importance of future-proofing the legislation. These powers are an example of that: without them, the Government will not have the ability to act quickly to update protections for individuals in the light of rapid technology developments.
I assure noble Lords that the regulation powers are subject to a number of safeguards. The Secretary of State must consult the Information Commissioner and have regard to other relevant factors, which can include the impact on individuals’ rights and freedoms as well as the specific needs and rights of children. As with all regulations, the exercise of these powers must be rational; they cannot be used irrationally or arbitrarily. Furthermore, the regulations will be subject to the affirmative procedure and so must be approved by both Houses of Parliament.
I assure the noble Lord, Lord Clement-Jones, that one of the powers means that his Amendment 123 is not necessary, as it can be used to describe specifically what is or is not meaningful human involvement.
Amendment 115A, tabled by the noble Viscount, Lord Camrose, would remove the reforms to Parts 3 and 4 of the Data Protection Act, thereby putting them out of alignment with the UK GDPR. That would cause confusion and ambiguity for data subjects.
Lord Clement-Jones (LD)
I am sorry to interrupt again as we go along but, a sentence or so ago, the Minister said that the definition in Amendment 123 of meaningful human involvement in automated decision-making was unnecessary. The amendment is designed to change matters. It would not be the Secretary of State who determined the meaning of meaningful human involvement; in essence, it would be initiated by the Information Commissioner, in consultation with the Secretary of State. So I do not quite understand why the Minister used “unnecessary”. It may be an alternative that is undesirable, but I do not understand why she has come to the conclusion that it is unnecessary. I thought it was easier to challenge the points as we go along rather than at the very end.
Baroness Jones of Whitchurch (Lab)
My Lords, we would say that a definition in the Bill is not necessary because it is dealt with case by case and is supplemented by these powers. The Secretary of State does not define meaningful human involvement; it is best done case by case, supported by the ICO guidance. I hope that that addresses the noble Lord’s point.
Lord Clement-Jones (LD)
That is slightly splitting hairs. The noble Viscount, Lord Camrose, might want to comment because he wanted to delete the wording that says:
“The Secretary of State may by regulations provide that … there is, or is not, to be taken to be meaningful human involvement”.
He certainly will determine—or is able to determine, at least—whether or not there is human involvement. Surely, as part of that, there will need to be consideration of what human involvement is.
Lord Knight of Weymouth (Lab)
Will the Minister reflect on the issues around a case-by-case basis? If I were running an organisation of any sort and decided I wanted to use ADM, how would I make a judgment about what is meaningful human involvement on a case-by-case basis? It implies that I would have to hope that my judgment was okay because I have not had clarity from anywhere else and in retrospect, someone might come after me if I got that judgment wrong. I am not sure that works, so will she reflect on that at some point?
Baroness Jones of Whitchurch (Lab)
The Secretary of State can help describe specific cases in the future but, on the point made by my noble friend Lord Knight, the ICO guidance will clarify some of that. There will be prior consultation with the ICO before that guidance is finalised, but if noble Lords are in any doubt about this, I am happy to write and confirm that in more detail.
Amendment 115 in the names of the noble Lords, Lord Clement-Jones, Lord Lucas and Lord Knight, and Amendment 123A in the name of the noble Lord, Lord Holmes, seek to ensure that individuals are provided with clear and accessible information about solely automated decision-making. The safeguards set out in Clause 80, alongside the wider data protection framework’s safeguards, such as the transparency principle, already achieve this purpose. The UK GDPR requires organisations to notify individuals about the existence of automated decision-making and provide meaningful information about the logic involved in a clear and accessible format. Individuals who have been subject to solely automated decisions must be provided with information about the decisions.
On Amendment 116 in the names of the noble Viscount, Lord Camrose, and the noble Lord, Lord Markham, I reassure noble Lords that Clause 69 already provides a definition of consent that applies to all processing under the law enforcement regime.
On Amendment 117 in the names of the noble Viscount, Lord Camrose, the noble Lords, Lord Markham, and my noble friend Lord Knight, I agree with them on the importance of protecting the sensitive personal data of children by law enforcement agencies, and there is extensive guidance on this issue. However, consent is rarely used as the basis for processing law enforcement data. Other law enforcement purposes, such as the prevention, detection and investigation of crime, are quite often used instead.
I will address Amendment 118 in the name of the noble Viscount, Lord Camrose, and Amendment 123B in the name of the noble Lord, Lord Holmes, together, as they focus on obtaining human intervention for a solely automated decision. I agree that human intervention should be carried out competently and by a person with the authority to correct a wrongful outcome. However, the Government believe that there is currently no need to specify the qualifications of human reviewers as the ICO’s existing guidance explains how requests for human review should be managed.
Viscount Camrose (Con)
Does the Minister agree that the crux of this machinery is solely automated decision-making as a binary thing—it is or it is not—and, therefore, that the absolute key to it is making sure that the humans involved are suitably qualified and finding some way to do so, whether by writing a definition or publishing guidelines?
Lord Holmes of Richmond (Con)
On the question of qualification, the Minister may wish to reflect on the broad discussions we have had in the past around certification and the role it may play. I gently her take her back to what she said on Amendment 123A about notification. Does she see notification as the same as a personalised response to an individual?
Baroness Jones of Whitchurch (Lab)
Noble Lords have asked several questions. First, in response to the noble Viscount, Lord Camrose, I think I am on the same page as him about binary rather than muddying the water by having degrees of meaningful intervention. The ICO already has guidance on how human review should be provided, and this will be updated after the Bill to ensure that it reflects what is meant by “meaningful human involvement”. Those issues will be addressed in the ICO guidance, but if it helps, I can write further on that.
I have forgotten the question that the noble Lord, Lord Holmes, asked me. I do not know whether I have addressed it.
Lord Holmes of Richmond (Con)
In her response the Minister said “notification”. Does she see notification as the same as “personalised response”?
Baroness Jones of Whitchurch (Lab)
My understanding is that it would be. Every individual who was affected would receive their own notification rather than it just being on a website, for example.
Let me just make sure I have not missed anyone out. On Amendment 123B on addressing bias in automated decision-making, compliance with the data protection principles, including accuracy, transparency and fairness, will ensure that organisations take the necessary measures to address the risk of bias.
On Amendment 123C from the noble Lord, Lord Clement-Jones, I reassure him that the Government strongly agree that employment rights should be fit for a modern economy. The plan to make work pay will achieve this by addressing the challenges introduced by new trends and technologies. I agree very much with my noble friend Lord Knight that although we have to get this right, there are opportunities for a different form of work, and we should not just see this as being potentially a negative impact on people’s lives. However, we want to get the balance right with regard to the impact on individuals to make sure that we get the best rather than the possible negative effects out of it.
Employment rights law is more suitable for regulating the specific use of data and technology in the workplace rather than data protection law in isolation, as data protection law sets out general rules and principles for processing that apply in all contexts. Noble Lords can rest assured that we take the impact on employment and work very seriously, and as part of our plan to make work pay and the Employment Rights Bill, we will return to these issues.
On Amendments 119, 120, 121 and 122, tabled by the noble Lord, Lord Clement-Jones, the noble Viscount, Lord Colville, and my noble friend Lord Knight, the Government share the noble Lords’ belief in the importance of public sector algorithmic transparency, and, as the noble Lord, Lord Clement-Jones, reminded us, we had a very good debate on this last week. The algorithmic transparency recording standard is already mandatory for government departments and arm’s-length bodies. This is a cross-government policy mandate underpinned by digital spend controls, which means that when budget is requested for a relevant tool, the team in question must commit to publishing an ATRS record before receiving the funds.
As I said on Friday, we are implementing this policy accordingly, and I hope to publish further records imminently. I very much hope that when noble Lords see what I hope will be a significant number of new records on this, they will be reassured that the nature of the mandation and the obligation on public sector departments is working.
Policy routes also enable us to provide detailed guidance to the public sector on how to carry out its responsibilities and monitor compliance. Examples include the data ethics framework, the generative AI framework, and the guidelines for AI procurement. Additionally, the data protection framework already achieves some of the intended outcomes of these amendments. It requires organisations, including public authorities, to demonstrate how they have identified and mitigated risks when processing personal data. The ICO provides guidance on how organisations can audit their privacy management and ensure a high level of data protection compliance.
I know I have given a great deal of detail there. If I have not covered all the points that the noble Lords have raised, I will write. In the meantime, given the above assurances, I hope that the noble Lord will withdraw his amendment.
Lord Lucas (Con)
My Lords, I would be very grateful if the Minister wrote to me about Amendment 115. I have done my best before and after to study Clause 80 to understand how it provides the safeguards she describes, and have failed. If she or her officials could take the example of a job application and the responses expected from it, and take me through the clauses to understand what sort of response would be expected and how that is set out in the legislation, I would be most grateful.
Lord Clement-Jones (LD)
My Lords, I thank the Minister for her very detailed and careful response to all the amendments. Clearly, from the number of speakers in this debate, this is one of the most important areas of the Bill and one that has given one of the greatest degrees of concern, both inside and outside the Committee. I think the general feeling is that there is still concern. The Minister is quite clear that the Government are taking these issues seriously, in terms of ADM itself and the impact in the workplace, but there are missing parts here. If you add all the amendments together—no doubt we will read Hansard and, in a sense, tick off the areas where we have been given an assurance about the interpretation of the Bill—there are still great gaps.
It was very interesting to hear what the noble Lord, Lord Kamall, had to say about how the computer said “no” as he reached the gate. A lot of this is about communications. I would be very interested if any letter to the noble Lord, Lord Lucas, was copied more broadly, because that is clearly one of the key issues. It was reassuring to hear that the ICO will be on top of this in terms of definitions, guidance, audit and so on, and that we are imminently to get the publication of the records of algorithmic systems in use under the terms of the algorithmic transparency recording standard.
We have had some extremely well-made points from the noble Viscounts, Lord Colville and Lord Camrose, the noble Lords, Lord Lucas, Lord Knight and Lord Holmes, and the noble Baroness, Lady Kidron. I am not going to unpack all of them, but we clearly need to take this further and chew it over before we get to Report. I very much hope that the Minister will regard a will write letter on stilts as required before we go very much further, because I do not think we will be purely satisfied by this debate.
The one area where I would disagree is on treating solely automated decision-making as the pure subject of the Clause 80 rights. Looking at it in the converse, it is perfectly proper to regard something that does not have meaningful human involvement as predominantly automated decision-making. I do not think, in the words of the noble Viscount, Lord Camrose, that this does muddy the waters. We need to be clearer about what we regard as being automated decision-making for the purpose of this clause.
There is still quite a lot of work to do in chewing over the Minister’s words. In the meantime, I beg leave to withdraw my amendment.
Lord Clement-Jones (LD)
My Lords, a key aspect of data protection rests in how it restricts the use of personal data once it has been collected. The public need confidence that their data will be used for the reasons they had shared it and not further used in ways that breach their legitimate expectations—or they will become suspicious as regards providing their data. The underlying theme that we heard on the previous group was the danger of losing public trust, which very much applies in the area of law enforcement and national security.
However, Schedules 4 and 5 would remove the requirement to consider the legitimate expectations of the individuals whose data is being processed, or the impact that this would have on their rights, for the purposes of national security, crime detection and prevention, safeguarding or answering to a request by a public authority. Data used for the purposes listed in these schedules would not need to undergo either a balancing test under Article 6.1(f) or a compatibility test under Article 6.4 of the UK GDPR. The combined effect of these provisions would be to authorise almost unconditional data sharing for law enforcement and other public security purposes while, at the same time, reducing accountability and traceability over how the police use the information being shared with them.
As with the previous DPDI Bill, Clauses 87 to 89 of this Bill grant the Home Secretary and police powers to view and use people’s personal data through the use of national security certificates and designation notices, which are substantially the same as Clauses 28 to 30 of the previous DPDI Bill. This risks further eroding trust in law enforcement authorities. Accountability for access to data for law enforcement purposes should not be lowered, and data sharing should be underpinned by a robust test to ensure that individuals’ rights and expectations are not disproportionately impacted. It is a bafflement as to why the Government are so slavishly following their predecessor and believe that these new and unaccountable powers are necessary.
By opposing that Clause 81 stand part, I seek to retain the requirement for police forces to record the reason they are accessing data from a police database. The public need more, not less, transparency and accountability over how, why and when police staff and officers access and use records about them. Just recently, the Met Police admitted that they investigated more than 100 staff over the inappropriate accessing of information in relation to Sarah Everard. This shows that the police can and do act to access information inappropriately, and there may well be less prominent cases where police abuse their power by accessing information without worry for the consequences.
Regarding Amendments 126, 128 and 129, Rights and Security International has repeatedly argued that the Bill would violate the UK’s obligations under the European Convention on Human Rights. On Amendment 126, the requirements in the EU law enforcement directive for logging are, principally, to capture in all cases the justification for personal data being examined, copied, amended or disclosed when it is processed for a law enforcement process—the objective is clearly to ensure that data is processed only for a legitimate purpose—and, secondarily, to identify when, how and by whom the data has been accessed or disclosed. This ensures that individual accountability is captured and recorded.
Law enforcement systems in use in the UK typically capture some of the latter information in logs, but very rarely do they capture the former. Nor, I am informed, do many commodity IT solutions on the market capture why data was accessed or amended by default. For this reason, a long period of time was allowed under the law enforcement directive to modify legacy systems installed before May 2016, which, in the UK, included services such as the police national computer and the police national database, along with many others at a force level. This transitional relief extended to 6 May 2023, but UK law enforcement did not, in general, make the required changes. Nor, it seems, did it ensure that all IT systems procured after 6 May 2016 included a strict requirement for LED-aligned logging. By adopting and using commodity and hyperscaler cloud services, it has exacerbated this problem.
In early April 2023, the Data Protection Act 2018 (Transitional Provision) Regulations 2023 were laid before Parliament. These regulations had the effect of unilaterally extending the transitional relief period under the law enforcement directive for the UK from May 2023 to May 2026. The Government now wish to strike the requirement to capture the justification for any access to data completely, on the basis that this would free up to 1.5 million hours a year of valuable police time for our officers so that they can focus on tackling crime on our streets, rather than being bogged down by administration, and that this would save approximately £42.8 million per year in taxpayers’ money.
This is a serious legislative issue on two counts: it removes important evidence that may identify whether a person was acting with malicious intent when accessing data, as well as removing any deterrent effect of them having to do so; and it directly deviates from a core part of the law enforcement directive and will clearly have an impact on UK data adequacy. The application of effective control over access to data is very much a live issue in policing, and changing the logging requirement in this way does nothing to improve police data management. Rather, it excuses and perpetuates bad practice. Nor does it increase public confidence.
Clause 87(7) introduces new Section 78A into the Act. This lays down a number of exemptions and exclusions from Part 3 of that Act when the processing is deemed to be in the interests of national security. These exemptions are wide ranging, and include the ability to suspend or ignore principles 2 through 6 in Part 3, and thus run directly contrary to the provisions and expectations of the EU law enforcement directive. Ignoring those principles in itself also negates many of the controls and clauses in Part 3 in its entirety. As a result, they will almost certainly result in the immediate loss of EU law-enforcement adequacy.
I welcome the ministerial letter from the noble Lord, Lord Hanson of Flint, to the noble Lord, Lord Anderson, of 6 November, but was he really saying that all the national security exemption clause does is bring the 2018 Act into conformity with the GDPR? I very much hope that the Minister will set out for the record whether that is really the case and whether it is really necessary to safeguard national security. Although it is, of course, appropriate and necessary for the UK to protect its national security interests, it is imperative that balance remains to protect the rights of a data subject. These proposals do not, as far as we can see, strike that balance.
Clause 88 introduces the ability of law enforcement, competent authorities and intelligence agencies to act as joint controllers in some circumstances. If Clause 88 and associated clauses go forward to become law, they will almost certainly again result in withdrawal of UK law enforcement adequacy and will quite likely impact on the TCA itself.
Amendment 127 is designed to bring attention to the fact that there are systemic issues with UK law enforcement’s new use of hyperscaler cloud service providers to process personal data. These issues stem from the fact that service providers’ standard contracts and terms of service fail to meet the requirements of Part 3 of the UK’s Data Protection Act 2018 and the EU law enforcement directive. UK law enforcement agencies are subject to stringent data protection laws, including Part 3 of the DPA and the GDPR. These laws dictate how personal data, including that of victims, witnesses, suspects and offenders, can be processed. Part 3 specifically addresses data transfers to third countries, with a presumption against such transfers unless strictly necessary. This contrasts with UK GDPR, which allows routine overseas data transfer with appropriate safeguards.
Cloud service providers routinely process data outside the UK and lack the necessary contractual guarantees and legal undertakings required by Part 3 of the DPA. As a result, their use for law enforcement data processing is, on the face of it, not lawful. This non-compliance creates significant financial exposure for the UK, including potential compensation claims from data subjects for distress or loss. The sheer volume of data processed by law enforcement, particularly body-worn video footage, exacerbates the financial risk. If only a small percentage of cases result in claims, the compensation burden could reach hundreds of millions of pounds annually. The Government’s attempts to change the law highlight the issue and suggest that past processing on cloud service providers has not been in conformity with the UK GDPR and the DPA.
The current effect of Section 73(4)(b) of the Data Protection Act is to restrict transfers for competent authorities who may have a legitimate operating need, and should possess the internal capability to assess that need, from making transfers to recipients who are not relevant authorities or international organisations and that cloud service provider. This amendment is designed to probe what impact removal of this restriction would have and whether it would enable them to do so where such a transfer is justified and necessary. I beg to move.
Baroness Morgan of Cotes (Non-Afl)
My Lords, I will speak to Amendment 124. I am sorry that I was not able to speak on this issue at Second Reading. I am grateful to the noble and learned Lord, Lord Thomas of Cwmgiedd, for his support, and I am sorry that he has not been able to stay, due to a prior engagement.
Eagle-eyed Ministers and the Opposition Front Bench will recognise that this was originally tabled as an amendment to the Data Protection and Digital Information (No. 2) Bill. It is still supported by the Police Federation. I am grateful to the former Member of Parliament for Loughborough for originally raising this with me, and I thank the Police Federation for its assistance in briefing us in preparing this draft clause. The Police Federation understands that the Home Secretary is supportive of the objective of this amendment, so I shall listen with great interest to what the Minister has to say.
This is a discrete amendment designed to address an extremely burdensome and potentially unnecessary redaction exercise, in relation to a situation where the police are preparing a case file for submission to the Crown Prosecution Service for a charging decision. Given that this issue was talked about in the prior Bill, I do not intend to go into huge amounts of detail because we rehearsed the arguments there, but I hope very much that with the new Government there might be a willingness to entertain this as a change in the law.
Lord Lucas (Con)
My Lords, I have Amendment 201 in this group. At the moment, Action Fraud does not record attempted fraud; it has to have been successful for the website to agree to record it. I think that results in the Government taking decisions based on distorted and incomplete data. Collecting full data must be the right thing to do.
Baroness Kidron (CB)
My Lords, I had expected the noble Baroness, Lady Owen of Alderley Edge, to be in the Room at this point. She is not, so I wish to draw the Committee’s attention to her Amendment 210. On Friday, many of us were in the Chamber when she made a fantastic case for her Private Member’s Bill. It obviously dealt with a much broader set of issues but, as we have just heard, the overwhelming feeling of the House was to support her. I think we would all like to see the Government wrap it up, put a bow on it and give it to us all for Christmas. But, given that that was not the indication we got, I believe that the noble Baroness’s intention here is to deal with the fact that the police are giving phones and devices back to perpetrators with the images remaining on them. That is an extraordinary revictimisation of people who have been through enough. So, whether or not this is the exact wording or way to do it, I urge the Government to look on this carefully and positively to find a way of allowing the police the legal right to delete data in those circumstances.
Viscount Camrose (Con)
My Lords, none of us can be under any illusion about the growing threats of cyberattacks, whether from state actors, state-affiliated actors or criminal gangs. It is pretty unusual nowadays to find someone who has not received a phishing email, had hackers target an account or been promised untold riches by a prince from a faraway country. But, while technology has empowered these criminals, it is also the most powerful tool we have against them. To that end, we must do all we can do to assist the police, the NCA, the CPS, the SIS and their overseas counterparts in countries much like our own. That said, we must also balance this assistance with the right of individuals to privacy.
Regarding the Clause 81 stand part notice from the noble Lord, Lord Clement-Jones, I respectfully disagree with this suggestion. If someone within the police were to access police records in an unauthorised capacity or for malign reasons, I simply doubt that they would be foolish enough to enter their true intentions into an access log. They would lie, of course, rendering the log pointless, so I struggle to see—we had this debate on the DPDI Bill—how this logging system would help the police to identify unauthorised access to sensitive data. It would simply eat up hours of valuable police time. I remember from our time working on the DPDI Bill that the police supported this view.
As for Amendment 124, which allows for greater collaboration between the police and the CPS when deciding charging decisions, there is certainly something to be said for this principle. If being able to share more detailed information would help the police and the CPS come to the best decision for victims, society and justice, then I absolutely support it.
Amendments 126, 128 and 129 seek to keep the UK in close alignment with the EU regarding data sharing. EU alignment or non-alignment is surely a decision for the Government of the day alone. We should not look to bind a future Administration to the EU.
I understand that Amendment 127 looks to allow data transfers to competent authorities—that is, law enforcement bodies in other countries—that may have a legitimate operating need. Is this not already the case? Are there existing provisions in the Bill to facilitate such transfers and, if so, does this not therefore duplicate them? I would very much welcome the thoughts of both the Minister and the noble Lord, Lord Clement-Jones, when he sums up at the end.
Amendment 156A would add to the definition of “unauthorised access” so that it includes instances where a person accesses data in the reasonable knowledge that the controller would not consent if they knew about the access or the reason for the access, and the person is not empowered to access it by an enactment. Given the amount of valuable personal data held by controllers as our lives continue to move online, there is real merit to this idea from my noble friend Lord Holmes, and I look forward to hearing the views of the Minister.
Finally, I feel Amendment 210 from my noble friend Lady Owen—ably supported in her unfortunate absence by the noble Baroness, Lady Kidron—is an excellent amendment as it prevents a person convicted of a sexual offence from retaining the images that breached the law. This will prevent them from continuing to use the images for their own ends and from sharing them further. It would help the victims of these crimes regain control of these images which, I hope, would be of great value to those affected. I hope that the Minister will give this serious consideration, particularly in light of noble Lords’ very positive response to my noble friend’s Private Member’s Bill at the end of last week.
Lord Clement-Jones (LD)
I think the noble Viscount, Lord Camrose, referred to Amendment 156A from the noble Lord, Lord Holmes—I think he will find that is in a future group. I saw the Minister looking askance because I doubt whether she has a note on it at this stage.
Viscount Camrose (Con)
I thank the noble Lord, Lord Clement-Jones; let me consider it a marker for future discussion.
Baroness Jones of Whitchurch (Lab)
I thank the noble Lord, Lord Clement-Jones, for coming to my rescue there.
I turn to the Clause 81 stand part notice tabled by the noble Lord, Lord Clement-Jones, which would remove Clause 81 from the Bill. Section 62 of the Data Protection Act requires law enforcement agencies to record their processing activities, including their reasons for accessing and disclosing personal information. Entering a justification manually was intended to help detect unauthorised access. The noble Lord was right that the police do sometimes abuse their power; however, I agree with the noble Viscount, Lord Camrose, that the reality is that anyone accessing the system unlawfully is highly unlikely to record that, making this an ineffective safeguard.
Meanwhile, the position of the National Police Chiefs’ Council is that this change will not impede any investigation concerning the unlawful processing of personal data. Clause 81 does not remove the strong safeguards that ensure accountability for data use by law enforcement that include the requirement to record time, date, and where possible, who has accessed the data, which are far more effective in monitoring potential data misuse. We would argue that the requirement to manually record a justification every time case information is accessed places a considerable burden on policing. I think the noble Lord himself said that we estimate that this clause may save approximately 1.5 million policing hours, equivalent to a saving in the region of £42.8 million a year.
Baroness Jones of Whitchurch (Lab)
Yes, we could not see the noble Lord’s raised eyebrows.
Turning to Amendment 124, I thank the noble Baroness, Lady Morgan, for raising this important issue. While I obviously understand and welcome the intent, I do not think that the legislative change is what is required here. The Information Commissioner’s Office agrees that the Data Protection Act is not a barrier to the sharing of personal data between the police and the CPS. What is needed is a change in the operational processes in place between the police and the CPS that are causing this redaction burden that the noble Baroness spelled out so coherently.
We are very much aware that this is an issue and, as I think the noble Baroness knows, the Government are committed to reducing the burden on the police and the Home Office and to exploring with partners across the criminal justice system how this can best be achieved. We absolutely understand the point that the noble Baroness has raised, but I hope that she could agree to give space to the Home Office and the CPS to try to find a resolution so that we do not have the unnecessary burden of redaction when it is not necessary. It is an ongoing discussion—which I know the noble Baroness knows really—and I hope that she will not pursue it on that basis.
I will address Amendments 126 to 129 together. These amendments seek to remove parts of Schedule 8 to avoid divergence from EU legislation. The noble Lord, Lord Clement-Jones, proposes instead to remove existing parts of Section 73 of the Data Protection Act 2018. New Section 73(4)(aa), introduced by this Bill, with its bespoke path for personal data transfers from UK controllers to international processors, is crucial. In the modern age, where the use of such capabilities and the benefits they provide is increasing, we need to ensure that law enforcement can make effective use of them to tackle crime and keep citizens safe.
Lord Clement-Jones (LD)
My Lords, I thank the Minister for her response on this group, which was, again, very detailed. There is a lot to consider in what she had to say, particularly about the clauses beyond Clause 81. I am rather surprised that the current Government are still going down the same track on Clause 81. It is as if, because the risk of abuse is so high, this Government, like the previous one, have decided that it is not necessary to have the safeguard of putting down the justification in the first place. Yet we have heard about the Sarah Everard police officers. It seems to me perverse not to require justification. I will read further what the Minister had to say but it seems quite extraordinary to be taking away a safeguard at this time, especially when the Minister says that, at the same time, they need to produce logs of the time of the data being shared and so on. I cannot see what is to be gained—I certainly cannot see £42 million being saved. It is a very precise figure: £42.8 million. I wonder where the £800,000 comes from. It seems almost too precise to be credible.
Baroness Jones of Whitchurch (Lab)
I emphasise that we believe the safeguards are there. This is not a watering down of provisions. We are just making sure that the safeguards are more appropriate for the sort of abuse that we think might happen in future from police misusing their records. I do not want it left on the record that we do not think that is important.
Lord Clement-Jones (LD)
No. As I was saying, it seems that the Minister is saying that there will still be the necessity to log the fact that data has been shared. However, it seems extraordinary that, at the same time, it is not possible to say what the justification is. The justification could be all kinds of things, but it makes somebody think before they simply share the data. It seems to me that, given the clear evidence of abuse of data by police officers—data of the deceased, for heaven’s sake—we need to keep all the safeguards we currently have. That is a clear bone of contention.
I will read what else the Minister had to say about the other clauses in the group, which are rather more sensitive from the point of view of national security, data sharing abroad and so on.
Lord Vallance of Balham
“(10) In section 199(2)(a) of the Investigatory Powers Act 2016 (bulk personal datasets: meaning of “personal data”), after “section 82(1) of that Act” insert “by an intelligence service”.”Member’s explanatory statement
Clause 88 of the Bill amends section 82 in Part 4 of the Data Protection Act 2018 (intelligence services processing). This amendment makes a consequential change to a definition in the Investigatory Powers Act 2016 which cross-refers to section 82.
Lord Vallance of Balham (Lab)
These four technical government amendments do not, we believe, have a material policy effect but will improve the clarity and operation of the Bill text.
Amendment 133 amends Section 199 of the Investigatory Powers Act 2016, which provides a definition of “personal data” for the purposes of bulk personal datasets. This definition cross-refers to Section 82(1) of the Data Protection Act 2018, which is amended by Clauses 88 and 89 of the Bill, providing for joint processing by the intelligence services and competent authorities. This amendment will retain the effect of that cross-reference to ensure that processing referred to in Section 199 of the IPA remains that done by an intelligence service.
Amendment 136 concerns Clause 92 and ICO codes of practice. Clause 92 establishes a new procedure for panels to consider ICO codes of practice before they are finalised. It includes a regulation-making power for the Secretary of State to disapply or modify that procedure for particular codes or amendments to them. Amendment 136 will enable the power to be used to disapply or modify the panel’s procedure for specific amendments or types of amendments to a code, rather than for all amendments to it.
Finally, Amendments 213 and 214 will allow for changes made to certain immigration legislation and the Online Safety Act 2023 by Clauses 55, 122 and 123 to be extended via existing powers in those Acts, exercisable by Orders in Council, to Guernsey and the Isle of Man, should they seek this.
I beg to move.
Viscount Camrose (Con)
My Lords, I will keep my comments brief as these are all technical amendments to the Bill. I understand that Amendments 133 and 136 are necessary for the functioning of the law and therefore have no objection. As for Amendment 213, extending immigration legislation amended by Clause 55 of this Bill to the Bailiwick of Guernsey or the Isle of Man, this is a sensible measure. The same can be said for Amendment 214, which extends the provision of the Online Safety Act 2023, amended by this Bill, to the Bailiwick of Guernsey or the Isle of Man.
Lord Clement-Jones
“(a) to monitor the application of GDPR, the applied GDPR and this Act, and ensure are fully enforced with all due diligence;(b) to act upon receiving a complaint, to investigate, to the extent appropriate, the subject matter of the complaint, and to take steps to clarify unsubstantiated issues before dismissing the complaint.”Member’s explanatory statement
This amendment removes the secondary objectives introduced by the Data Use and Access Bill, which frame innovation, competition, crime prevention and national security as competing objectives against the enforcement of data protection law.
Lord Clement-Jones (LD)
My Lords, in moving Amendment 134—it is the lead amendment in this group—I shall speak to the others in my name and my Clause 92 stand part notice. Many of the amendments in this group stem from concerns that the new structure for the ICO will diminish its independence. The ICO is abolished in favour of the commission.
Lord Lucas (Con)
I have Amendment 135A in this group. The Bill provides a new set of duties for the Information Commissioner but no strategic framework, as the DPDI Bill did. The Information Commissioner is a whole-economy regulator. To my mind, the Government’s strategic priorities should bear on it. This amendment would provide an enabling power, such as that which the Competition and Markets Authority, which is in an equivalent economic position, already has.
Baroness Kidron (CB)
My Lords, I have huge sympathy for, and experience of, many of the issues raised by the noble Lord, Lord Clement-Jones, but, given the hour, I will speak only to Amendment 145 in my name and those of the noble Baroness, Lady Harding, my noble friend Lord Russell and the noble Lord, Lord Stevenson. Given that I am so critical, I want to say how pleased I am to see the ICO reporting requirements included in the Bill.
Amendment 145 is very narrow. It would require the ICO to report specifically and separately on children. It is fair to say that one of the many frustrations for those of us who spend our time advocating for children’s privacy and safety is trying to extrapolate child-specific data from generalised reporting. Often it is not reported because it is useful to hide some of the inadequacies in the level of protection afforded to children. For example, none of the community guidelines enforcement reports published for Instagram, YouTube, TikTok or Snapchat provides a breakdown of the violation rate by age group, even though that would provide valuable information for academics, Governments, legislators, NGOs and, of course, regulators. It was a point of contention between many civil society organisations and Ofcom that there was no evidence that children of different ages react in different ways, which, for anyone who has had children, is clearly not the case.
Similarly, for many years we struggled to understand Ofcom’s reporting because older children were included in a group that went up to 24, and it took over 10 years for that to change. It seems to me—I hope the Government agree—that since children are entitled to specific data privacy benefits, it follows that the application and enforcement of those benefits should be reported separately. I hope that the Government can give a quick yes on this small but important amendment.
Viscount Camrose (Con)
My Lords, given the hour, I will try to be as brief as possible. I will start by speaking to the amendments tabled in my name.
Amendment 142 seeks to prevent the Information Commissioner’s Office sending official notices via email. Official notices from the ICO will not be trivial: they relate to serious matters of data protection, such as monetary penalty notices or enforcement notices. My concern is that it is all too easy for an email to be missed. An email may be filtered into a spam folder, where it sits for weeks before being picked up. It is also possible that an email may be sent to a compromised email address, meaning one that the holder has lost control of due to a hacker. These concerns led me also to table Amendment 143, which removes the assumption that a notice sent by email had been received within 48 hours of being sent.
Additionally, I suspect I am right in saying that a great many people expect official correspondence to arrive via the post. I wonder, therefore, whether there might be a risk that people ignore an unexpected email from the ICO, concerned that it might well be a scam or a hack of some description. I, for one, am certainly deeply suspicious of unexpected but official-looking messages that arrive. I believe that official correspondence which may have legal ramifications should really be sent by post.
On some of the other amendments tabled, Amendment 135A, which seeks to introduce a measure from the DPDI Bill, makes provision for the introduction of a statement of strategic priorities by the Secretary of State that sets out the Government’s data protection priorities, to which the commissioner must have regard, and the commissioner’s duties in relation to the statement. Although I absolutely accept that this measure would create more alignment and efficiency in the way that data protection is managed, I understand the concerns that it would undermine the independence of the Information Commissioner’s Office. That in itself, of course, would tend to bear on the adequacy risk.
I do not support the stand part notices on Clauses 91 and 92. Clause 91 requires the Information Commissioner to prepare codes of practice for the processing of data, which seems a positive measure. It provides guidance to controllers, helping them to control best practice when processing data, and is good for data subjects, as it is more likely that their data will be processed in an appropriate manner. As for Clause 92, which would effectively increase expert oversight of codes of practice, surely that would lead to more effective codes, which will benefit both controllers and data subjects.
I have some concerns about Amendment 144, which limits the Information Commissioner to sending only one reprimand to a given controller during a fixed period. If a controller or processor conducts activities that infringe the provisions of the GDPR and does so repeatedly, why should the commissioner be prevented from issuing reprimands? Indeed, what incentives does that give for people to commit a minor sin and then a major one later?
I welcome Amendment 145, in the name of the noble Baroness, Lady Kidron, which would ensure that the ICO’s annual report records activities and action taken by the ICO in relation to children. This would clearly give the commissioner, parliamentarians and the data and tech industry as a whole a better understanding of how policies are affecting children and what changes may be necessary.
Finally, I turn my attention to many of the amendments tabled by the noble Lord, Lord Clement-Jones, which seek to remove the involvement of the Secretary of State from the functions of the commissioner and transfer the responsibility from government to Parliament. I absolutely understand the arguments the noble Lord advances, as persuasively as ever, but I am concerned even so that the Secretary of State for the relevant department is the best person to work with the commissioner to ensure both clarity of purpose and rapidity of decision-making.
Lord Stevenson of Balmacara (Lab)
I wanted to rise to my feet in time to stop the noble Viscount leaping forward as he gets more and more excited as we reach—I hope—possibly the last few minutes of this debate. I am freezing to death here.
I wish only to add my support to the points of the noble Baroness, Lady Kidron, on Amendment 145. It is much overused saw, but if it is not measured, it will not get reported.
Baroness Jones of Whitchurch (Lab)
My Lords, I thank noble Lords for their consideration of the issues before us in this group. I begin with Amendment 134 from the noble Lord, Lord Clement-Jones. I can confirm that the primary duty of the commissioner will be to uphold the principal objective: securing an appropriate level of data protection, carrying out the crucial balancing test between the interests of data subjects, controllers and wider public interests, and promoting public trust and confidence in the use of personal data.
The other duties sit below this objective and do not compete with it—they do not come at the expense of upholding data protection standards. The commissioner will have to consider these duties in his work but will have discretion as to their application. Moreover, the new objectives inserted by the amendment concerning monitoring, enforcement and complaints are already covered by legislation.
I thank the noble Lord, Lord Lucas for Amendment 135A. The amendment was a previous feature of the DPDI Bill but the Government decided that a statement of strategic priorities for the ICO in this Bill is not necessary. The Government will of course continue to set out their priorities in relation to data protection and other related areas and discuss them with the Information Commissioner as appropriate.
Amendment 142 from the noble Viscount, Lord Camrose, would remove the ICO’s ability to serve notices by email. We would argue that email is a fast, accessible and inexpensive method for issuing notices. I can reassure noble Lords that the ICO can serve a notice via email only if it is sent to an email address published by the recipient or where the ICO has reasonable grounds to believe that the notice will come to the attention of the person, significantly reducing the risk that emails may be missed or sent to the wrong address.
Regarding the noble Viscount’s Amendment 143, the assumption that an email notice will be received in 48 hours is reasonable and equivalent to the respective legislation of other regulators, such as the CMA and Ofcom.
I thank the noble Lord, Lord Clement-Jones, for Amendment 144 concerning the ICO’s use of reprimands. The regulator does not commonly issue multiple reprimands to the same organisation. But it is important that the ICO, as an independent regulator, has the discretion and flexibility in instances where there may be a legitimate need to issue multiple reprimands within a particular period without placing arbitrary limits on that.
Turning to Amendment 144A, the new requirements in Clause 101 will already lead to the publication of an annual report, which will include the regulator’s investigation and enforcement activity. Reporting will be categorised to ensure that where the detail of cases is not public, commercially sensitive investigations are not inadvertently shared. Splitting out reporting by country or locality would make it more difficult to protect sensitive data.
Turning to Amendment 145, with thanks to the noble Baroness, Lady Kidron, I agree with the importance of ensuring that the regulator can be held to account on this issue effectively. The new annual report in Clause 101 will cover all the ICO’s regulatory activity, including that taken to uphold the rights of children. Clause 90 also requires the ICO to publish a strategy and report on how it has complied with its new statutory duties. Both of these will cover the new duty relating to children’s awareness and rights, and this should include the ICO’s activity to support and uphold its important age-appropriate design code.
I thank the noble Lord, Lord Clement-Jones, for Amendments 163 to 192 to Schedule 14, which establishes the governance structure of the information commission. The approach, including the responsibilities conferred on the Secretary of State, at the core of the amendments follows standard corporate governance best practice and reflects the Government’s commitment to safeguarding the independence of the regulator. This includes requiring the Secretary of State to consult the chair of the information commission before making appointments of non-executive members.
Amendments 165 and 167A would require members of the commission to be appointed to oversee specific tasks and to be from prescribed fields of expertise. Due to the commission’s broad regulatory remit, the Government consider that it would not be appropriate or helpful for the legislation to set out specific areas that should receive prominence over others. The Government are confident that the Bill will ensure that the commission has the right expertise on its board. Our approach safeguards the integrity and independence of the regulator, draws clearly on established precedent and provides appropriate oversight of its activities.
Finally, Clauses 91 and 92 were designed to ensure that the ICO’s statutory codes are consistent in their development, informed by relevant expertise and take account of their impact on those likely to be affected by them. They also ensure that codes required by the Secretary of State have the same legal effect as pre-existing codes published under the Data Protection Act.
Considering the explanations I have offered, I hope that the noble Lords, Lord Clement-Jones and Lord Lucas, the noble Viscount, Lord Camrose, and the noble Baroness, Lady Kidron, will agree not to press their amendments.
Lord Clement-Jones (LD)
My Lords, I thank the Minister for that response. If I speak for four minutes, that will just about fill the gap, but I hope to speak for less than that.
The Minister’s response was very helpful, particularly the way in which she put the clarification of objectives. Of course, this is shared with other regulators, where this new growth duty needs to be set in the context of the key priorities of the regulator. My earlier amendment reflected a nervousness about adding innovation and growth duties to a regulator, which may be seen to unbalance the key objectives of the regulator in the first place, but I will read carefully what the Minister said. I welcome the fact that, unlike in the DPDI Bill, there is no requirement for a statement of strategic priorities. That is why I did not support Amendment 135A.
It is somewhat ironic that, in discussing a digital Bill, the noble Viscount, Lord Camrose, decided to go completely analogue, but that is life. Maybe that is what happens to you after four and a half hours of the Committee.
I do not think the Minister covered the ground on the reprimands front. I will read carefully what she said about the annual report and the need for the ICO—or the commission, as it will be—to report on its actions. I hope, just by putting down these kinds of amendments on reprimands, that the ICO will take notice. I have been in correspondence with the ICO myself, as have a number of organisations. There is some dissatisfaction, particularly with companies such as Clearview, where it is felt that the ICO has not taken adequate action on scraping and building databases from the internet. We will see whether the ICO becomes more proactive in that respect. I was reassured, however, by what the Minister said about NED qualifications and the general objective on the independence of the regulator.
There is much to chew on in what the Minister said. In the meantime, I beg leave to withdraw my amendment.
House of Lords
Anti-social Behaviour and Shoplifting
(2 days, 6 hours ago)
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Baroness Hazarika
To ask His Majesty’s Government what plans they have to tackle anti-social behaviour and shoplifting.
The Minister of State, Home Office (Lord Hanson of Flint) (Lab)
This Government will tackle anti-social behaviour by rebuilding visible neighbourhood policing, with 13,000 additional neighbourhood officers and PCSOs, and will bring in new respect orders to enable police to ban persistent anti-social offenders from our town centres. We will also introduce a new offence of assaulting a retail worker and end the effective immunity for shop theft of goods under £200.
Baroness Hazarika (Lab)
My Lords, I thank my noble friend for his Answer. I was pleased to see that safer streets are a priority for this Government. Will the Minister agree that anti-social behaviour and crimes such as shoplifting, aggressive begging and phone theft are anything but low-level and can blight the lives of local residents and businesses? Many people who work in shops feel like they are living in a war zone. Will he agree that anti-social behaviour can so often be the canary down the coal mine and tell a wider story about what kind of society we are living in? Finally, will there be a focus on targeting often a small number of hardened criminals who are responsible for terrorising local residents and shops? Will the police and courts take this more seriously and consider the use of technology such as facial recognition?
Lord Hanson of Flint (Lab)
I am pleased to say to my noble friend that it is a “yes” to every point she has raised. Anti-social behaviour and shop theft are not minor crimes. They cause disruption in our communities. Shop theft in particular costs retailers across the nation millions of pounds, which is passed on to us as customers, and it is not acceptable. That is why, on shop theft, we are going to end the £200 effective immunity. For shop workers, we will protect them by introducing a new offence, because they are very often upholding the law in their shops on alcohol, tobacco and other sales, for us in this House.
Earl Attlee (Con)
My Lords, while I agree with everything the noble Baroness has just said, will the Minister join me in the hope that the sentencing review will result in fewer women being sent to prison unnecessarily?
Lord Hanson of Flint (Lab)
I do not wish to pre-empt the sentencing review undertaken by David Gauke, a former Conservative Justice Secretary, which was commissioned by the Lord Chancellor. Self-evidently, it is in the interests of society to have fewer women go to prison and to have an increase in community-based sentences. David Gauke and the Lord Chancellor will look at both of those matters as part of the review.
The Earl of Clancarty (CB)
My Lords, what assessment have the Government made about increased shoplifting being a result of increasing poverty in our society?
Lord Hanson of Flint (Lab)
As always, shoplifting takes place for a range of reasons. But I will not excuse shoplifting and shop theft under any circumstances, because they are still crimes. I grew up on a very poor estate in Liverpool and in Cheshire. It was not acceptable to shoplift then and it is not acceptable now. We need to ensure that we tackle that by having neighbourhood policing, a greater emphasis and focus for the police on shop theft and greater support to retailers. I appreciate the noble Earl’s view on poverty: we look at poverty in the round and put measures in for a range of reasons to lift people out of poverty, to ensure that they can live reasonable, productive and effective lives.
Baroness Doocey (LD)
My Lords, the Minister has said that, before introducing respect orders, the Government will run a number of pilots, which is a very good idea. But current laws on anti-social behaviour have never been thoroughly reviewed and the Home Office does not even keep records on how they are being used at the moment. So, before the Government introduce these new respect orders, will they agree to review the current laws and how they are working, so that lessons learned could be used to inform the pilots?
Lord Hanson of Flint (Lab)
I am grateful to the noble Baroness for that comment. We will keep all legislation under review. Again, after 14 years out of office, we want to review some of the measures: how they have been utilised and what can be done to improve community resilience. The most important thing we can do is certainly pilot the respect orders, but a really important issue will be the 13,000 neighbourhood police and community support officers, who can embed themselves more in the community, can look at what responses are required, can work with people such as shopkeepers in relation to the shop theft that my noble friend Lady Hazarika mentioned, and can work with the community to look at what could best be utilised to gain the support of the community in reducing crime.
Lord Boateng (Lab)
My Lords, the increasing theft of child/baby milk formula suggests that criminal justice measures alone will not deal with this problem. So what proposals do the Government intend to bring forward to have a discussion with those who produce and sell child/baby milk formula, in order to address this issue and the increasing impact on the poorest families of the rising cost of that formula?
Lord Hanson of Flint (Lab)
I hope I can reassure my noble friend and the noble Earl, Lord Clancarty, that poverty is an important issue for this Government. If there are trends in the type of theft that is occurring, such as theft of baby milk, that will indicate some element of poverty-related theft. But we have to tackle poverty holistically, looking at a range of measures on social welfare, housing and the support we are giving through minimum wage increases and other things to ensure that we can help raise people out of poverty. The Government have a target to lift the poverty level. But that still does not excuse theft, which has to be at the heart of this Government’s approach. Shop theft is a key responsibility of mine at the Home Office and we will bring forward legislative measures, if supported by both Houses, to tackle it.
Lord Randall of Uxbridge (Con)
My Lords, having spent most of my working life working in a shop, I welcome the protections for shop workers and the Minister’s comments about the seriousness of shoplifting and crime. What encouragement can he give to law enforcement officers to also take this seriously?
Lord Hanson of Flint (Lab)
The 2014 Act that changed the threshold and put a £200 threshold on shop theft did not change the law, but it changed the approach that law enforcement officers took: thefts under £200 were seen as thefts that we did not need to respond to or go out to. I regard that as unacceptable, which is why we are changing the law to abolish that £200 threshold to allow police to focus on the issue. Neighbourhood policing will help that. The shop workers’ defence and the aggravated offence of attacks on a shop worker are there to protect shop workers who are upholding the law in shops as the first form of defence. I have been a member of the shop workers’ union for 44 years. This is an important issue to the union—it has campaigned on it for 20 years—and it is an important issue for both Houses to recognise. I look forward to taking legislation through this House in due course.
Lord Hogan-Howe (CB)
My Lords, the original question was entirely right: the repeat victim/offender location theory applies to both these offences. A small percentage of offenders account for a very high majority of offences. Would the Minister agree with me that there are three things police can do to bear down on this? One, as already indicated, is to attend the scene of an event and see what has happened, whether it is shoplifting or anti-social behaviour, rather than make a phone call. The second is that a linking offence or a linking event is the supply of alcohol to underage people through pubs and off-licences. The third is the uncontrolled street-level dealing of drugs. These are susceptible to some simple tactics. It is not an issue of resources: it is about uniformity of application and method. Perhaps the Government have an opportunity to make sure the police apply all three of those.
Lord Hanson of Flint (Lab)
I am very grateful to the noble Lord; he makes three valuable points which we will certainly take on board. My right honourable friend Diana Johnson, the Policing Minister in the House of Commons, has recently chaired a round table which I attended with the chief constable of north Wales, who is the lead on shop theft, to look at how we can co-ordinate police forces better across county lines, how we can follow up on the points the noble Lord mentioned in terms of onward use of criminal activity such as alcohol and/or drugs, and how we can, through Operation Pegasus, resource and examine those serious shop thefts that are involving not just shoplifters on an individual basis, as mentioned by the noble Lord, Lord Boateng, and others, but those criminal gangs that are organising very strong shoplifting hits. Operation Pegasus has just received additional resources from this Government to support its work.
Baroness O'Grady of Upper Holloway (Lab)
My Lords, I am sure that across this House we would agree that no shop worker should go to work afraid for their safety. But is the Minister aware of Home Office research showing that the majority of shoplifting offences are carried out by hard-drug users? Can the Minister tell us what steps government can take to reduce the stigma and shame around addiction so that more users seek help?
Lord Hanson of Flint (Lab)
I am grateful to my noble friend. One of the key things the last Government did—as in the last Labour Government, from 2005 to 2010—was ensure we had a number of community-based sentences and community orders to support people who had drug or alcohol addictions to overcome those addictions and therefore stop shoplifting because of those addictions. I certainly hope the sentencing review will consider that in the round. When the measures we have brought forward come to this House and to the House of Commons in due course, I hope that issue of how we tackle persistent offenders and intervene on their behaviour will be central to our purpose in passing legislation downstream.
Older People’s Housing Taskforce
(2 days, 6 hours ago)
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The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Lord Khan of Burnley) (Lab)
My Lords, the Government are thankful to the chair of the task force, Professor Julienne Meyer, and all its members for producing such a comprehensive, detailed and well-researched report. I recognise the importance of improving housing choices for older people, and I thank the noble Lord, Lord Best, for all he does on this issue. We are committed to taking action on older people’s housing and will consider this issue as we develop our long-term housing strategy.
Lord Best (CB)
I thank the Minister for that positive response, and I congratulate Professor Julienne Meyer and her task force on a really good report. Have the Minister and his Government paid particular attention to at least three of the key recommendations from this report, such as that 10% of all affordable housing should be for older people, that planners should require a percentage of all major developments to be for older people, and that stamp duty should be exempt where an older person is downsizing, rightsizing, making way for and releasing a home for a family elsewhere?
Lord Khan of Burnley (Lab)
My Lords, I recognise how important the right housing arrangements are in supporting people to live independently and well. The Government will set out details of new investment to succeed the 2021 to 2026 affordable homes programme at the spending review. The National Planning Policy Framework outlines that local authorities should assess the housing needs of different groups, including older people, and reflect this in their local plans. We have strengthened the National Planning Policy Framework to encourage the delivery of mixed-tenure development. For most of those looking to downsize, the stamp duty due on the new property will be small. Stamp duty is an important source of revenue to provide essential services, and the Government have no further plans for relief for those looking to downsize.
Lord Young of Cookham (Con)
My Lords, further to the Question from the noble Lord, Lord Best, and the Minister’s reply, the task force published its report two weeks ago, before the Government published their National Planning Policy Framework, and, despite what he says, that policy framework does not reflect the major recommendations of the task force. Will the Government publish a detailed response to all the recommendations of the task force, and will they implement some of the recommendations in the forthcoming planning Bill?
Lord Khan of Burnley (Lab)
My Lords, we consulted on reforms to the National Planning Policy Framework and published our response on 12 December. We are determined to create a more diverse housing market that delivers homes to meet a range of needs. On the noble Lord’s particular point, we will respond to all 44 recommendations of the task force. However, my honourable friend in the other House, Matthew Pennycook, will look at this in the wider housing strategy.
Baroness Pidgeon (LD)
My Lords, the report of the task force mentions the LGBTQ+ communities only once, yet there is a growing need and desire for inclusive LGBT+ affirming retirement accommodation, as provided by organisations such as Tonic Housing. What plans do the Government have to address these specific needs?
Lord Khan of Burnley (Lab)
My Lords, the noble Baroness makes an important point. As I said, the task force report was published two weeks ago, and we are looking at each of its 44 recommendations to make sure that our housing needs are diverse for the country. It is in the national interest that the Government ensure that we have housing that reflects the country and that we take into account the needs of people of all backgrounds and all ages.
Baroness Pitkeathley (Lab)
My Lords, in considering the housing needs of older people, is the Minister mindful that many older people are also caring? It is not at all uncommon for people in their 70s to be caring for people in their 90s, or for people in their 80s to be caring for older adult children with special needs. Will these responsibilities of older people also be considered when looking at housing needs?
Lord Khan of Burnley (Lab)
My Lords, my noble friend makes a very important point. On carers, the Government are committed to ensuring that families have the support that they need. I want to ensure that people who care for family and friends are better able to look after their own health and well-being. The Department for Work and Pensions announced its intention to bring forward an independent review of the issue of overpayment of carer’s allowance in cases where earnings have exceeded the entitlement threshold. The Government are committed to reviewing the implementation of carer’s leave and examining the benefits of introducing paid carer’s leave.
Lord Foulkes of Cumnock (Lab Co-op)
My Lords, does my noble friend agree that it is very important to have intergenerational development so that there are not ghettos of older people in one place and ghettos of young people, particularly students, in another? If developments are intergenerational, they can help each other. Will he therefore discourage the kinds of developments I see in Edinburgh—no doubt they are elsewhere too—where private developers build blocks for students which seem to me to be purely to make some additional money rather than in the interests of the students themselves?
Lord Khan of Burnley (Lab)
My Lords, the noble Lord makes an interesting point about intergenerational living. Unfortunately, I cannot comment on that particular case, but I am happy to take it away with me and have a private conversation with him.
Baroness Finlay of Llandaff (CB)
My Lords, what levers do the Government plan to have to ensure that the recommendations in the report, such as accessible bathrooms and toilets, with doors to bathrooms that open outwards, are actually built into all new plans because of a high incidence of falls in the home? These affect not only morbidity but mortality rates. Similarly, how will they ensure that stairs are properly designed, as we previously debated, to decrease the number of falls of old people on stairs?
Lord Khan of Burnley (Lab)
The noble Baroness makes a very important point. I understand that accessibility in new homes—and accessibility standards for buildings in general—is an important concern. Housing is one of this Government’s top priorities. Everyone deserves to live in a decent home where they feel safe. We will set out our policies on accessible new-build housing shortly, and we will make sure that accessibility is a part of the discussion when we bring forward our new housing strategy.
Baroness Winterton of Doncaster (Lab)
My Lords, in planning for older people in housing and with regard to accessibility, is it not also important to ensure that this accommodation is near accessible bus routes, for example? Will my noble friend the Minister look at how devolved powers can be used to ensure that local authorities work together with, for instance, local bus companies to ensure that proper provision is provided for older people in what can be isolated areas?
Lord Khan of Burnley (Lab)
My noble friend makes a very important point. I will take it away with me and discuss it with Minister Pennycook. It will also be a cross-departmental discussion with the Department for Transport to ensure that the particular issues that my noble friend raises are addressed and thought of when moving forward so that we can make not only the house accessible within, but the route to the house.
Lord Jamieson (Con)
My Lords, I declare my interest as set out in the register, particularly that I was a member of the Older People’s Housing Taskforce. It is widely acknowledged that supported accommodation can significantly benefit the health and well-being of older people. That has the additional benefit of saving social care and the health service considerable costs. In addition, if it is placed in urban areas, it can support town centre regeneration.
However, due to the additional facilities, the building costs of supported accommodation are substantially higher than those of mainstream accommodation. In recognition of this, one of the task force’s recommendations to help to deliver supported accommodation was that it should not be subject to demands as heavy as the affordable housing and Section 106 planning obligations of mainstream housing. Will the Minister confirm that the Government will support this?
Lord Khan of Burnley (Lab)
The Government will publish a housing strategy that will set out a long-term vision for the housing market that works for communities, building 1.5 million high-quality homes and the biggest increase in affordable housing in a generation. Supported housing plays a vital role in delivering better life outcomes, improved well-being and health, as the noble Lord mentioned, and greater independence for many vulnerable people, including older, disabled and homeless people.
We recognise the challenges local authorities are facing as demand increases for critical services. We have listened to voices across local government and have announced £4 billion in additional funding for local government services at the Budget, including £1.3 billion, which will go through the settlement.
Lord Ranger of Northwood (Con)
My Lords, as the noble Lord, Lord Foulkes, mentioned earlier with regard to intergenerational housing, my community and many other communities have grown up with the older generation living with us, and it has helped in caring and sharing, by both young and old, as families stay together. That has faded a bit over the decades, but it is still happening. However, the challenge for communities and families in continuing to do that is ever-increasing with the costs for caring for older people. Is the task force looking at that in its report?
Lord Khan of Burnley (Lab)
The noble Lord makes an interesting and important point. When my honourable friend Minister Pennycook looks at the 44 recommendations from the task force—I thank the task force once again for its hard work in this area—we need to ensure dignity and a better quality of living for all generations. However, as the Question from the noble Lord, Lord Best, outlines, there is a particular issue in relation to older people’s housing. We need to ensure that the housing strategy reflects the mixed tenure of houses to be built and to work closely with local authorities up and down the country to ensure that they can decide what the needs are for their area.
Domestic Animals: Welfare
(2 days, 6 hours ago)
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Lord Black of Brentwood
To ask His Majesty’s Government what steps they are taking to improve the welfare of domestic animals.
Lord Black of Brentwood (Con)
My Lords, I beg leave to ask the Question standing in my name on the Order Paper, and I declare my interest as a patron of International Cat Care.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)
My Lords, I congratulate the noble Lord on his new job. The Government will end puppy smuggling, address puppy farming by tackling low-welfare dog breeding practices and consider whether more should be done to protect the welfare of companion animals. We are supporting some key measures in Private Members’ Bills and have already met with key companion animal stakeholders as the first steps in delivering on our commitments and developing an overarching approach to animal welfare.
Lord Black of Brentwood (Con)
I thank the Minister for her Answer and for her passion for and enduring commitment to animal welfare. Does she agree that too many cats are being bred commercially without adequate safeguards to protect their welfare? Increasingly, unregulated, unlicensed, unscrupulous owners are raising cats with extreme, exaggerated features to sell as fashion accessories without any concern for the terrible harm to the animal. So-called bully cats, for example, are bred without fur, which predisposes them to painful skin disease, and their genetically shortened legs can result in joint abnormalities and agonising arthritis. Will the Minister join me in condemning the practice of breeding for deformity, which causes unacceptable suffering and distress? Will she commit as a matter of urgency to regulating cat breeding in order to ban such activity?
Baroness Hayman of Ullock (Lab)
My Lords, the licensing of activities involving animal regulations requires anyone in the business of breeding and selling cats to have a licence, and they must meet statutory minimum welfare standards. The noble Lord makes some very good points about recent practices that are not acceptable. Defra has been working on a post-implementation review of the regulations, which will be published shortly. We are also carefully considering the recommendations in EFRA’s report on pet welfare and abuse, and the Animal Welfare Committee’s opinion on feline breeding, which will also be published soon.
Baroness Young of Old Scone (Lab)
My Lords, can the Minister assure us that the Government will find time during this Session to reform the Veterinary Surgeons Act 1966, which is already 60 years old and rather showing its age? A fundamental improvement to the welfare of domestic animals would be to bring up to date the legislation regulating veterinary medicine and particularly veterinary medical practices, which are currently not formally regulated. That would enable the public—and indeed the animals—to be assured that veterinary medicine, and veterinary practices in particular, will provide modern, high standards of care. The Competition and Markets Authority is looking at this issue, and an update is long overdue. Can the Minister assure me that she will provide time for that legislation?
Baroness Hayman of Ullock (Lab)
We will of course continue to support the vital work of the veterinary profession, and I acknowledge the veterinary workforce’s commitment and dedication to animal health and welfare. My noble friend makes a good point, and we are very aware of calls to reform the Veterinary Surgeons Act 1966, which is now very old. Defra is talking to key stakeholders and different veterinary groups to explore the best way to support the profession, and we are looking at the legislation.
Lord Trees (CB)
My Lords, we are undoubtedly a nation of animal lovers, but some of the UK’s major animal welfare issues are in plain sight and affect some of our most popular pets. I refer to the extreme conformations mentioned by the noble Lord, Lord Black, but particularly the problem of flat-nosed dogs—so-called brachycephalic breeds—which suffer or are highly predisposed to ill health virtually all their life, with breathing, whelping, ocular and skin difficulties, and reduced lifespan. Legislation exists to deter the breeding of such animals, should that lead to a detriment to the health and welfare of the bitch or her offspring. Why has there not been a single prosecution under the legislation, given that this is a serious welfare issue?
Baroness Hayman of Ullock (Lab)
My Lords, our animal activities licensing regulations have been developed to prevent poor dog breeding practices rather than penalise them. Local authorities can refuse, vary or revoke a licence to breed where they are concerned about the dog’s fitness. We believe the impact of having a licence revoked provides a significant deterrent. However, the noble Lord makes a very good point in that, currently, prosecutions are perhaps not happening as frequently as we would expect. This is clearly a matter for the Home Office, and I am very happy to take it up with my colleagues.
Baroness Parminter (LD)
My Lords, now that all cats and dogs have to be compulsorily microchipped, the number of microchipping databases has shot up to 23 but none of them talk to each other, so it is really hard for rescue centres and local authorities to rehouse the animals or find the owners. What plans do the Government have to introduce a portal to link up these databases, so that cats and dogs can be rehomed quickly?
Baroness Hayman of Ullock (Lab)
The noble Baroness makes a very good point. We are aware that there are some digital challenges within the department, and we are looking at that very carefully.
Baroness McIntosh of Pickering (Con)
My Lords, does the noble Baroness agree that not enough is being done about puppy smuggling? How many prosecutions for puppy smuggling and for boiler-house productions have there been following the Animal Welfare Act? Boiler-house puppies could be relieved if the mother—the bitch—was present at the sale of the puppies. Will the Government enforce that?
Baroness Hayman of Ullock (Lab)
The noble Baroness makes a good point. On puppy smuggling, we have made a clear commitment to end puppy farming. We are also supporting a Private Member’s Bill in the other place on puppy smuggling, because we are determined to do our best to stop these abhorrent practices.
Lord Roborough (Con)
My Lords, I refer the House to my register of interests. The public rightly benefit from fantastic access to the countryside through our network of public and permissive footpaths, as well as open access land. However, this brings pets into frequent proximity with farmed animals. Earlier this year, we supported legislation to update and strengthen police powers to deal with livestock worrying; it was not enacted. What plans do the Government have to increase protection for farmed animals?
Baroness Hayman of Ullock (Lab)
My Lords, the Government have committed to support a Private Member’s Bill, introduced by the Conservative Member of Parliament, Aphra Brandreth, which looks to introduce new measures to tackle the serious issue of livestock worrying. The Bill is going to focus on three areas which we support: modernising the definitions in scope, strengthening police powers, as suggested by the noble Lord, and increasing the maximum penalty from a fine of £1,000 to an unlimited fine in order to act as a deterrent.
Lord Lexden (Con)
Can the Minister tell the House when the regulations to ban the use of cruel, remote-controlled electronic shock collars for cats and dogs, which inexplicably failed to gain Commons approval before the election, will be introduced? Will she give a clear commitment to put them into effect as fast as possible?
Baroness Hayman of Ullock (Lab)
Defra’s code of practice for the welfare of dogs supports positive reward training techniques for dogs, but electronic shock collars should be avoided. Furthermore, the code advises people to seek out professional advice for behaviour problems, and the best training options that are available. The Government are currently considering the available evidence on the use of hand-controlled e-collars and their effects on the welfare of animals.
Lord Randall of Uxbridge (Con)
What measures are Government thinking of taking to try to eradicate dog fighting?
Baroness Hayman of Ullock (Lab)
Clearly, dog fighting should not be taking place in this country. We are extremely keen to root it out where it is happening, and it is matter for Defra and the Home Office to work on together to ensure that, where it is found, it is properly cracked down on.
Baroness Butler-Sloss (CB)
People remain in danger from and are occasionally killed by dangerous animals. Are the Government satisfied that the current law is sufficient?
Baroness Hayman of Ullock (Lab)
Ongoing attacks show that we need to do more to protect the public from dangerous dogs. There has of course been a ban on XL bullies, which has been updated recently. That is there to protect public safety, and we expect owners to comply with all the conditions in that legislation. More broadly, we are working with enforcement agencies and animal welfare groups to help prevent further attacks by encouraging responsible dog ownership, addressing dog control issues before they escalate and using the full force of the law where needed.
Baroness Bennett of Manor Castle (GP)
My Lords, we have heard this afternoon the Government’s announcement on plans for substantial changes to local government. Of course, much of the enforcement of animal welfare regulations happens at local government level. Can the Minister assure me that Defra is fully involved in making sure that, whenever the changes happen, the animal welfare elements are maintained as a strong force in whatever new arrangements come in?
Baroness Hayman of Ullock (Lab)
I can completely reassure the noble Baroness that we are working very closely on a cross-departmental basis on any issues that cover more than one department’s interests. I am sure she is aware that I have a very strong interest in animal welfare and will be doing all I can to ensure that it is considered at every level.
International Anti-corruption Court
(2 days, 6 hours ago)
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The Parliamentary Under-Secretary of State, Foreign, Commonwealth and Development Office (Lord Collins of Highbury) (Lab)
My Lords, we look forward to considering the draft treaty, which is expected next year, for the proposed international anti-corruption court. This Government fully support the objective of holding kleptocrats to account, but the idea of an IACC carries challenges and requires detailed consideration. Meanwhile, we will use all our tools to deliver an ambitious government-wide agenda to tackle the devastating impacts of corruption and illicit finance, both at home and overseas.
Lord Hain (Lab)
My Lords, I thank my noble friend for confirming the Government’s support for an international anti-corruption court. As he has indicated, international experts from countries north and south, right across the world, now have an agreed draft treaty and will soon begin consulting with interested parties. So far, these include Botswana, Canada, France, the Gambia, Kenya, Mozambique, the Netherlands, Nigeria, Norway, South Africa and Switzerland. Will Ministers ensure that the UK both participates officially in this treaty-drafting process and encourages more states to do so? Such a new court is vital to help combat global corruption, costing $2 trillion each and every year.
Lord Collins of Highbury (Lab)
My Lords, as I said, we support the objectives of the proposed international anti-corruption court. We look forward to considering the draft treaty and will continue to engage in international discussions on this subject as they arise, and as we have done to date. As my noble friend said, these discussions should not detract from the work the Government are already delivering to hold kleptocrats to account. For example, the UK’s international corruption unit has a world-leading capability and has successfully investigated international bribery, corruption and related money-laundering offences within a UK nexus, resulting in prosecutions and the confiscation of stolen assets.
Lord Swire (Con)
My Lords, does the Minister recall the problems that we have had with the ICC, for example, as some countries simply will not sign up to these international bodies? Some of the most corrupt countries in the world are not going to adhere to anything that such an international court would do. I broadly welcome the idea of such a court, but wonder whether, in reality, some of the worst offenders simply will not turn up.
Lord Collins of Highbury (Lab)
The noble Lord makes a valid point. We are working collaboratively, as my noble friend said, with other countries to ensure that we can look at this in principle and then see how we can achieve it. My main point is that we should follow the money. We have actually been extremely successful: the unit I just talked about has been successful in ensuring that illicit funds are returned and that we sanction people. An important tool in our armour is that ability to ensure that people know that, when they try to get funds out of their country, we will follow it and return it.
Lord Purvis of Tweed (LD)
My Lords, I welcome the Government’s recent announcements on anti-corruption, including the announcement that the noble Baroness, Lady Hodge, will be the Government’s anti-corruption champion. Is now not the opportunity for the UK to play a leading role in the drafting of a treaty, not simply to wait for it to be presented to us? If the UK is part of the drafting, we will have the best opportunity in a long time to address the very point that the noble Lord, Lord Swire, made: that never again will global corruption be channelled through London, the City of London, London lawyers or any part of the British establishment. That will be an opportunity if we help draft the treaty, rather than wait until it is presented to us.
Lord Collins of Highbury (Lab)
There is a range of options here, and I have met Judge Wolf. A range of experts is looking into the draft treaty, and we have been talking to international countries. What we need to do, if we are to get this court off the ground, is ensure that all these countries are working together and supporting the treaty. I heard what the noble Lord said, but I come back to my fundamental point: I will not wait until an international court is established, which can take time and requires consensus. We are determined—and this is why the appointment of my noble friend Lady Hodge is so critical—to follow the money and make sure that people do not get away with corruption.
Lord Keen of Elie (Con)
My Lords, the United Nations estimates that the cost of kleptocracy is something in the region of $40 billion per annum, much of which falls on the poorest countries in the world. When the international anti-corruption court was being mooted originally, the United Nations established the International Anti-Corruption Coordination Centre, which is intended to operate a joint working platform and intelligence sharing. As the Minister indicated, the centre, having become operational in 2017, is hosted by the United Kingdom’s National Crime Agency. Can he advise the House on how many cases the centre has dealt with in the last seven years? In addition to the United Kingdom, the United States, Canada, Australia, New Zealand and Singapore, how many countries participate in the work of the centre? What steps are the Government taking to promote participation in the work of the centre? He said that one follows the money for the purposes of jurisdiction, and the United Kingdom is of course a centre for such funds.
Lord Collins of Highbury (Lab)
I very much welcome the noble and learned Lord’s comments and I look forward to working with him to ensure that we can achieve these objectives. Since July 2017, the IACCC has received 331 referrals of grand corruption from 40 different countries, has identified over £1.4 billion of assets suspected to be the proceeds of corruption, helped freeze £631 million of stolen assets, and supported the arrest of 48 suspects in grand corruption cases. We will work collaboratively with all the countries that the noble and learned Lord mentioned.
Lord Alton of Liverpool (CB)
My Lords, I refer the Minister to remarks I cited, when we discussed this last, by the right honourable Gordon Brown, the former Prime Minister, who is a strong supporter of the international anti-corruption court. In pointing a finger at kleptocracy, he mentioned the Panama papers, the Pandora papers and Russian assets being used in the Channel Islands, the British Virgin Islands and UK dependent territories. In addition, he cited the need for this court to deal with the crime of aggression and the other offenses committed by Putin during the war in Ukraine. Can the Minister assure us that he will be used as one of our best advocates in the discussions which will take place on the formulation of the forthcoming treaty and making this court come about?
Lord Collins of Highbury (Lab)
I welcome the noble Lord’s comments. I met Judge Wolf, who has proposed this for some time and has been campaigning for it. A range of international experts is looking at the proposed treaty, and they are doing very good work. We are committed to examining the outcome of that work and the development of a draft treaty as it proceeds. I emphasise to the noble Lord that we are not standing still and waiting for these institutions to be established. I have visited eight African countries, all of which faced corruption. One of the things that they have been incredibly pleased about is our ability to co-operate with and support them in ensuring that illicit funds not only are returned but do not get out of the country. We are absolutely determined to do that. With the appointment of my noble friend Lady Hodge, I know that we will push this up the global agenda, and we have a strong advocate in her in fighting this crime.
Baroness Whitaker (Lab)
My Lords, following the remarks of the noble and learned Lord, Lord Keen of Elie, does my noble friend the Minister agree that corruption is of crucial importance to developing countries and that, once the court is in operation, our very much diminished aid budget will be very much more effective?
Lord Collins of Highbury (Lab)
The noble Baroness is absolutely right. I stress that not only are we following the money, ensuring that we take action against those who commit this crime, but in recent times we have been supporting the African Beneficial Ownership Transparency Network. I addressed its first in-person conference. With the African Development Bank, we are working to ensure that people cannot hide what they own. Transparency is another important tool in ensuring that we combat illicit finance.
Intelligence and Security Committee
(2 days, 6 hours ago)
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Baroness Smith of Basildon
That the House approves the nominations of Lord Beamish, Lord West of Spithead, and Baroness Brown of Cambridge as members of the Intelligence and Security Committee of Parliament.
Lord Foulkes of Cumnock (Lab Co-op)
My Lords, I fully support the Motion in the name of the Lord Privy Seal. Would it be appropriate at this time to ask if it would be possible for the Intelligence and Security Committee to conduct an investigation into H6 and all the allegations of spying by China?
The Lord Privy Seal (Baroness Smith of Basildon) (Lab)
My Lords, I do not think it is for the Lord Privy Seal to instruct the Intelligence and Security Committee on its business or how to conduct it. I am sure it will take note of the report, is fully aware of the situation and will do whatever is appropriate.
Arrangement of Business
Baroness Wheeler (Lab)
My Lords, before we start the first part of Committee, I thought it would be useful to update the House as to how we will proceed. As noble Lords will see from today’s list, the usual channels have agreed that the Committee will sit until we have reached the target—that is the debate on the next 13 groups. We will break for dinner at around 7.30 pm for around an hour. During this time, the noble Baroness, Lady Merron, will take 40 minutes of questions on a health Statement given in the House of Commons last week. The House will then be adjourned during pleasure for an additional 20 minutes to give everyone participating in the Bill enough time for a proper break.
Football Governance Bill [HL]
Monday 16th December 2024
(2 days, 6 hours ago)
Lords ChamberRead Full debate Football Governance Bill [HL] 2024-26 View all Football Governance Bill [HL] 2024-26 Debates Read Hansard Text Amendment Paper: HL Bill 41-V(a) Amendment for Committee (Supplementary to the Fifth Marshalled List) - (13 Dec 2024)
Baroness Brady
Baroness Brady (Con)
My Lords, I refer the Committee to my interests as declared in the register. This group of amendments includes Amendment 110 in my name which addresses a concern about potential political interference in football’s new regulatory framework.
The Bill creates an unusual—and, I believe, likely to be unnecessary—requirement for football governance statements every three years from the Secretary of State. This is not merely a question of frequency; I believe that the expectation created for this statement may raise questions about regulatory independence and broader international implications, which we have discussed in this Committee a number of times.
As I and other noble Lords have pointed out, UEFA and FIFA maintain strict provisions against state interference in football. We have already seen UEFA’s general secretary express serious concerns about various aspects of this Bill. In that context, we are obliged to ask whether creating a requirement, or even an expectation, for regular political statements about football governance risks providing these bodies with an additional point of leverage over English football’s development. UEFA has been clear that it is watching the implementation of this framework very closely, including in relation to possible scope creep and stepping over the line, so it behoves us to consider carefully the possible practical implications of such a mechanism and to question its necessity.
Every three years, the Secretary of State may make a statement about football governance. The Minister may say that there is no obligation here, and that it is just providing for the possibility. However, it seems inevitable that putting this expectation into statute creates a very strong likelihood that these statements will then be made. What will they say—that everything is fine, or are they more likely to look at more areas that the regulator can examine and then expand into, as we have seen with this Bill so far?
As the general secretary of UEFA spelled out in a letter sent to me last week:
“UEFA has previously shared its concerns about the creation of an Independent Football Regulator … as normally football regulation should be managed by the national federation. It is essential to ensure that the establishment of this structure fully adheres to the principle of sports autonomy, thus preventing any risk of political or governmental interference in the legitimate and appropriate functioning of recognised sports governing bodies. The IFR’s mandate must be clearly defined and strictly limited to the long-term financial sustainability of clubs and heritage assets”.
Despite these repeated warnings, it seems reasonable to assume that the expectation of a football governance statement will create not just inevitable domestic pressure for political intervention but opportunities for international bodies to question the regulator’s independence. There may be a whole range of wider issues going on with international governing bodies at the time of the football governance statement—for example, negotiations on the football calendar or the future of competition formats. With these football governance statements, we seem to be creating an unnecessary risk that the statements, almost irrespective of their content, may be deemed to constitute political interference. English football will not be served well by such a dynamic.
My amendment would align the statement cycle with the other five-year regulatory timeframes in the Bill, reducing the frequency of these potential pressure points. However, this is about not just timing but protecting football’s independence while maintaining proper oversight. I look forward to hearing from the Minister on how necessary these statements are.
Professional football requires long-term certainty for investment. In my long experience, stadium development can take up to 10 years to plan and execute. Academy investment needs at least a five-year horizon. Infrastructure projects require stable planning frameworks. Yet we seem to be risking the creation of a system where policy could shift every three years in response to short-term political steers, with each statement also potentially triggering questions about regulatory independence. I worry that these regular political statements could create permanent pressure for intervention beyond the regulator’s core purpose.
I would be very grateful if the Minister could give us the Government’s perspective on these important questions. What is the rationale for creating this unique pressure point for political intervention? How does the Minister believe that it will support long-term investment, especially given the international oversight concerns? What protections exist or could exist against scope creep through these regular statements? How will the Government manage UEFA and FIFA concerns about state interference in relation to this? I beg to move.
Lord Maude of Horsham (Con)
My Lords, I rise to support my noble friend’s amendment, and to question whether it is wise for the Government to include this clause in the Bill. It says:
“The Secretary of State may prepare a statement”,
and then it goes on. A Secretary of State can prepare a statement of anything at any time. It requires no statutory permission in a Bill to enable this to happen, but the effect of putting this in the Bill is, precisely as my noble friend has explained, to raise the spectre that UEFA, in particular, will see this as further evidence of political and government interference in football, which is a big concern for it. The Government have so far tiptoed around the edge of the concerns that UEFA has, but we know that the consequences for English football, if they go on to the wrong side of that line, will be severe.
Lord Pannick (CB)
My Lords, I repeat my declaration of interest, having spent much of the past three months representing Manchester City Football Club against disciplinary charges brought by the Premier League.
I pay tribute to the noble Baroness, Lady Brady, who has long been a friend of mine. She has unrivalled experience of being employed by Birmingham City Football Club and, for many years, West Ham United Football Club, and has achieved great success at both those clubs. I respectfully suggest, though, that here she protests too much. Clause 11(2) contains a very important restriction on what a football governance statement may do. It
“may not contain any policies that are inconsistent with the purpose of this Act or with the IFR’s objectives”.
The second protection is in subsection (6):
“The Secretary of State must lay any football governance statement, or any revised statement, published under this section before Parliament”.
Those are very considerable protections.
We listen to concerns that companies that own football clubs need long-term planning, but surely any company is subject to changes of government policy over the years. There is no protection whatever against those and the consequences thereof. I see absolutely no reason why football clubs should be protected by more than the three-year period stated here.
Lord Hayward (Con)
My Lords, before I start my comments on this clause, I thank the Minister for meeting me last week to discuss a number of issues—they did not include this clause, but I appreciate the opportunity to discuss other issues with her. My concern about this clause comes from the very first words of the Bill, which say that it is to:
“Establish the Independent Football Regulator”—
an independent regulator, not one circumscribed by a government Statement as laid out in Clause 11.
I disagree with the noble Lord, Lord Maude, who said, if I heard him correctly, that this was unique. It is not. Sadly, my mind goes back to a previous occasion when the Government wanted to circumscribe an independent regulator. I remember the debate clearly, because the late and great Lord Judge made a massive contribution to it, scything through the then Government’s arguments about why they should have a Statement in relation to an independent regulator. The independent regulator to which I refer is encompassed in the Elections Act. The previous Government said, “Ah, we’ve got an Elections Act. We don’t really like what the Electoral Commission is doing, so we’ll put in a nice little clause which requires the Government to make a Statement”, which, in effect, circumscribed the Electoral Commission. What is fascinating about that set of circumstances, which Lord Judge and I—and the Liberal Democrats and the Labour Party—criticised comprehensively, is that the wording in Clause 11 is remarkably similar to that in Section 16 of the Elections Act. In fact, Clause 11(5) of the Bill is almost identical, word for word, to new Section 4A(7) of PPERA inserted by that section.
I said just now that people on other Benches spoke against the Government imposing some form of Statement on the Electoral Commission as
“‘not fit for purpose and inconsistent with the … role as an independent regulator’”.—[Official Report, 6/2/24; col. 1604.]
We are talking here about the same wording. Those were words from the Liberal Front Bench—the noble Lord, Lord Rennard. The Labour Front Bench, in the form of the noble Lord, Lord Khan, said that
“this statement is unnecessary and the Government have provided no evidence for why it is needed … There was cross-party agreement that the commission’s independence is vital”.—[Official Report, 6/2/24; col. 1602.]
I could go on quoting the noble Lords, Lord Khan and Lord Rennard, making the point that a regulator is independent if it is independent, not because it is circumscribed by a set of conditions as set out in Clause 11. I recommend anybody to look at the relevant amendments to the Elections Act 2022, where the wording is virtually identical. The Government then wanted to circumscribe the Electoral Commission. I would not be surprised if the officials discussing this Bill when it was in draft under the previous Government said, “Oh, we’ve got a good basic tenet; we’ve even got a set of words which we can lift, virtually verbatim, and it’ll circumscribe the independent regulator”.
I opposed the Government’s imposition of that statement in the Elections Act, because I believed it circumscribed what should have been an independent regulator. When the then Opposition forced a vote on it, I sat where the noble Lord, Lord Bassam, is now and abstained, because I refused to support the Government imposing on an independent regulator a provision which is virtually word for word that set out in Clause 11. I therefore strongly support the amendments and oppose this clause standing part of the Bill.
Lord Parkinson of Whitley Bay (Con)
My Lords, I will speak to my Amendment 111, which is part of this group, and pick up some of the points that my noble friends have raised in the debate.
My Amendment 111 states that the Secretary of State should not be permitted to revise a football governance statement simply because there has been a “significant change” in government policy on football. The reasoning for this comes from much the same place as my noble friend Lady Brady’s Amendment 110: both try to prevent the possibility of frequent changes in the Government’s policies for the regulator. If the Secretary of State took up every opportunity that the Bill allows to alter the governance statement—it could be every three years, after every general election and after every change in government policy—we could see this governance statement being altered rather frequently, every few years, with effects on the stability of football.
How would clubs have the certainty they need to plan their investment? As my noble friend Lady Brady said, football clubs plan their infrastructure and stadium developments over periods of 10 to 15 years or more. The talent pipeline, which is needed to develop the players of the future, requires much more than five years of careful thought and investment. To do all this and deliver the sustainability of English football, clubs need to know what the policies of the regulator will be over the long term. They need to know what the regulator will require of them.
My noble friend Lord Hayward reflected on a broader point in his remarks. The Government have been at pains to stress the importance of the independence of this regulator. I do not doubt their intention, but how will that independence be maintained when there could be regular and changing political statements setting out the policies to which the regulator will have to adhere? We need some assurances that these governance statements will not interfere with the operational independence of the regulator. To do that, it seems much more sensible that the Secretary of State should not be able to revise these statements on a whim or because the department’s Secretaries of State are changing with the regularity that we have seen in recent years.
I hope the Minister will address the points that have been raised and look favourably on these amendments. I look forward to her reassurances.
The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)
I thank the noble Baroness, Lady Brady, and the noble Lord, Lord Parkinson of Whitley Bay, for their amendments. Clause 11 permits the Secretary of State to publish a statement on government policy related to football governance. The statement is non-binding, but the regulator will be required to have regard to it when exercising its functions.
On Amendment 110, in the name of the noble Baroness, Lady Brady, we believe that, given the fast-paced nature of football and the changing regulatory landscape, every three years is a suitable time to pass before the Secretary of State can amend this statement. This decision was reached following consultation with other regulators.
There is no duty on the Secretary of State to amend or publish a statement every three years, unless there is reason to. I understand the noble Baroness has concerns that this could present an opportunity to exert political influence on the regulator and thus a risk to the regulator’s independence. Although this is a standard provision for most economic regulators, I recognise the intent behind the amendments, to reduce the risk of interference.
The noble Lords, Lord Parkinson and Lord Hayward, raised concerns that this clause might limit independence. The football governance statement cannot be used to direct the regulator’s day-to-day operations, so it will not impinge on the operational independence of the regulator. The Bill has been brought forward as a result of the policy of this and the previous Government. As the noble Lord, Lord Pannick, made clear, the regulator’s statutory scope and powers would remain unchanged and it would be under no obligation to act in accordance with any statement. We want to ensure that the regulator remains free of any undue political interference; this drafting, as with the previous Government’s version of the Bill, achieves that.
The noble Baroness, Lady Brady, and the noble Lord, Lord Maude of Horsham, raised concerns around UEFA’s position in relation to this clause. As I have reiterated previously, we have engaged extensively with both the FA and UEFA in the development of the Bill. As has been confirmed by the FA, we are confident that the Bill as drafted will not breach any UEFA statutes. The regulator will be operationally independent of the Government and will not exert an undue influence on the FA’s ability to govern the game. This was confirmed by the FA itself in oral evidence given to the House of Commons Public Bill Committee on 14 May during the passage of the previous Bill introduced by the last Government.
Baroness Brady (Con)
I thank the Minister for her response and assurances about the purpose and scope of the football governance statements, and I thank other noble Lords for their contributions. I remain concerned about the potential for these statements to introduce unnecessary political pressure points and raise questions about regulatory independence. I appreciate the intent to use them as an optional tool for accountability and transparency. However, I respectfully request that the Minister and the Government reflect on the points raised in the debate, particularly regarding the implications for long-term investment and the risk of creating permanent leverage for international bodies, such as UEFA and FIFA, that will disproportionately affect Premier League clubs playing or aspiring to play in European competitions.
I want to pick up on the comment about Spain made by the noble Baroness, Lady Taylor, which the Minister mentioned. That legislation concerns a very specific clause which was due to the dominance of Barcelona and Real Madrid. They sold their own rights and retained all the money, which collapsed the entire Spanish football system. That legislation is very different from the binary process of the backstop and allows for 10% of the revenues to be redistributed—as an aside, the Premier League is already distributing 16%. The clause is very specific and very different from this first-ever government intervention into British sport. The interaction between the statements and the broader regulatory framework must be very carefully managed to ensure that English football is not placed at a disadvantage in global competitions and subjected to unnecessary uncertainty and potentially harmful leverage.
I am also grateful for the Minister’s reassurance about scope creep and the need to respect the regulator’s independence. The Minister mentioned the FA’s appearance in front of the Select Committee; she will know that that was before this Bill was published. I suggest that it would be good for the Minister to speak to the FA again. There is room for further clarity on how these statements, if they are necessary at all, will be framed to avoid triggering concerns about state interference, particularly in light of UEFA’s clear reservations. I again ask the Minister to publish the letter UEFA sent to her, which, by all accounts, was very alarming.
With those points noted, I will withdraw my amendment, but I hope the Minister will continue to engage with stakeholders on these important issues. I beg leave to withdraw.
Baroness Brady
Baroness Brady (Con)
My Lords, in moving Amendment 12 I will also speak to Amendments 113 to 115 in my name and Amendments 116 to 119 in the name of my noble friend Lord Parkinson. These amendments address what is in my view a weakness in the Bill’s approach to regulatory guidance and consultation. They are important amendments because they go to the heart of how this new regulator will operate in practice.
The Minister has reassured us that this will be a collaborative regulator working closely with football; that is very welcome. Yet, unfortunately, the Bill requires the production of guidance only for the imposition of discretionary licence conditions. For every other major regulatory function, including some of the most significant interventions ever proposed in British sport, there is no obligation for the regulator to explain how it will act via guidance. Nor, indeed, is there any requirement to consult those affected as it produces that guidance.
I welcome my noble friend Lord Parkinson’s suggestion of a code of practice to guide the regulator’s approach in a number of important areas. Perhaps I can highlight just three crucial areas where I believe we need more clarity. The first is financial sustainability, the regulator’s core purpose. Despite extensive debates in this Committee about what financial sustainability means, or should mean, in practice, the regulator would have no obligation to define how it will assess soundness or resilience in guidance or what system it will use to make it work.
That means that a club such as my own, West Ham United, seeking to make long-term investment decisions, would have no clarity on how they might be judged. Worse than that, there is no requirement to consult with the industry on what these vital definitions should look like. Ministers have described the regulatory model as light touch. One of my amendments seeks to ensure that this is indeed the case when it comes to financial regulation, asking the regulator to publish guidance on the financial outcomes it wishes to see from clubs.
Secondly, there is the owners’ and directors’ test. This vital mechanism, critical to attracting responsible investment, is not written into the legislation. It is left—albeit with some considerations in the Bill—to the regulator to develop. Again, there is no requirement to consult clubs, leagues or potential investors on its design. I do not think it unreasonable to ask: how can English football expect to attract responsible, long-term investment without requirements for regulatory transparency or co-operation that would undoubtedly result in higher-quality and better-informed regulation?
Thirdly, and perhaps most concerning, is the backstop power over financial distributions. This unprecedented mechanism could fundamentally alter football’s financial flows, yet the regulator does not need to explain how it will approach such decisions or consult on its methodology. Billions of pounds are at stake, along with the very existence of the key competitive measures, tools, structures and incentives that currently underpin the English pyramid’s success. It is the most extraordinary of interventions, yet there is no requirement for even the most ordinary of procedural safeguards.
This absence of guidance risks creating real uncertainty. The Premier League recently agreed a new domestic broadcasting deal running through to 2029. Clubs are making infrastructure investments over similar timelines. As I have already said, academy and stadium developments require five to 10-year horizons. I must emphasise that it puts football clubs in a really difficult position to be able to make major commitments without any real clarity on how they will be regulated.
We have a real lack of a clarity on a range of areas in the Bill, compounded by uncertainty as to how the regulator will go about regulating in practice. My amendments in this group do not seek to constrain the regulator’s authority in any way. They seek only to ensure that its powers are exercised transparently and intelligently. They would simply require the regulator to provide guidance across all its functions and consult appropriately on its development. This is a minimal yet clearly critical requirement.
I hope and expect the Minister to say that it is her clear intention that this regulator will be collaborative. If that is the case, I think it is fair to ask: why not go the extra step and enshrine that approach in the Bill? What justification exists for allowing such significant powers to be exercised without clear guidance or consultation?
In conclusion, I encourage the Minister to examine these vital improvements and consider them clearly. Transparency and collaboration should not be optional extras. They should instead be the cornerstones of this new framework. I beg to move.
Baroness Evans of Bowes Park (Con)
My Lords, I will speak briefly in favour of this group of amendments. I particularly support those that would introduce a requirement for the IFR to consult those affected as it produces guidance. Consultation with key interested and impacted parties, particularly the leagues, is critical.
The IFR is an entirely new regulator operating in an entirely new regulated space with no real international experience to draw on. As I highlighted at Second Reading:
“The Explanatory Notes themselves acknowledge that football ‘was previously not regulated by statutory provisions’, and explicitly state that ‘the new regime and the distributions provisions in particular are unique and unprecedented’”.—[Official Report, 13/11/24; col. 1850.]
A duty to consult on key areas, such as those set out by my noble friend Lady Brady, to ensure that unintended and potentially damaging consequences are avoided as the regulator begins its work and develops its guidance, is surely a no-brainer.
At our recent meeting with the shadow regulator, and in various responses from the Minister during Committee, the desire and expectation of the regulator to work in a collaborative and proportionate way have been repeatedly reiterated. Several amendments in this group simply put that consultative approach firmly and squarely on the face of the Bill. I hope the Minister can look favourably on them.
Lord Pannick (CB)
My Lords, I too hope very much that the Minister and the department will look favourably on these amendments, for the reasons given by the noble Baronesses, Lady Brady and Lady Evans. They seem to be absolutely essential for reasons of efficacy and to give confidence to those who will be regulated that they and others will be properly consulted. I would be very surprised to be told that the regulator would not intend to do so. If that is right, it is surely essential, as in other legislation, that this is put in the Bill so that there is no doubt about it and so that the confidence that is absolutely essential is promoted.
Lord Addington (LD)
My Lords, this amendment about the bodies that will be regulated has a fair bit of common sense behind it. I am sure the Government will have done great work on consultation and making sure there is communication between the bodies that will be being regulated and the new regulator. If the Minister can tell us how this is being done, some of my worries will be removed. Also, stating where that information will be provided would very much help. If not, it has to be in the Bill somewhere.
Lord Parkinson of Whitley Bay (Con)
My Lords, I will speak to my amendments in this group and say a little about the amendments tabled by my noble friends Lady Brady and Lord Moynihan.
The amendments relate to the guidance the new independent regulator will be required to publish. My noble friend Lady Brady and I agree that the Bill, as drafted, should be strengthened to ensure that the regulated clubs have the information they need to meet the requirements of the new regulator.
My Amendment 116 would require the independent football regulator to issue a code of practice for competition organisers and licensed clubs. The regulator would be required to consult the FA, each competition organiser and each club in preparing this code. The overriding point of all the amendments in this group, I think, is to support clubs and competition organisers in complying with the requirements of the new regulator. We cannot expect the regulator to be effective unless it is doing its work in a clear way. These amendments would help to deliver that clarity.
I will not speak at length on this point as it is a simple one. We seek clarity from the Government more than anything else. Will the Minister give the Committee an assurance today that the regulator will produce a code of practice for regulated clubs and competitions? Might there be a way of publishing a draft code of practice while the Bill is being considered? That was certainly very helpful when we looked at the new regulatory regime brought in through the Online Safety Act, although I appreciate that, in that case, Ofcom had more of a head start than the shadow regulator does here—but it would be helpful if that were feasible.
My Amendment 117 delivers much the same result as the sensible amendment in the name of my noble friend Lady Brady. Again, we want to give clubs and competition organisers a fuller picture of the independent football regulator’s plans for the future, so they can prepare for the impact it will have on the game. Again, I hope the Government will look favourably on this amendment and the point that lies behind it.
Lord Moynihan (Con)
My Lords, I will speak to my Amendment 119A in this group. Noble Lords will recall that, on many occasions, I have been active on the appointments made by the DCMS, in particular when it came to the consumer protection Bill in your Lordships’ House and the non-declaration of the CEO of Seatwave, which was an online European ticketing marketplace that was then to be sold to Ticketmaster. The announcement of the individual concerned to the DCMS board made no mention of that, and nor was there any declaration in the House, despite the fact that Seatwave was subject to very significant criticisms about ticket touting and the impact on consumers.
I took an interest over the weekend to look in more detail at some of the appointments that have been made, to satisfy myself and the Committee that they were wholly independent of government. Could the Minister provide the Committee, in due course, with a comprehensive answer on the process that has been followed to date for each and every appointment to the senior levels of the shadow football regulator, including when and how the legal requirements for Civil Service recruitment have been implemented, namely that selections must be based on merit and on fair and open competition? Departments and agencies can develop their own recruitment approaches, but how has the governance code on public appointments been followed, including integrity, merit, openness, diversity and assurance? Who has been on the appointment boards and how many appointments have been made from outside DCMS officials?
What would help the Committee to understand the question of the degree of true independence of the proposed football regulator is to know how many of the Bill team and the paid advisers to the DCMS are going on from government to join the shadow regulator and, in due course, the full regulator. Are the shadow regulator contracts in any way tied to appointments to jobs with the full regulator? If so, how many and whose?
My probing amendment does not question in any sense the integrity or competence of the candidates concerned. But I went on LinkedIn this weekend and had the opportunity to read, as a result of a connection on LinkedIn, that one of the most senior appointments made was based, in part no doubt, on the outstanding work that was done by that individual on football governance while doing their PhD. I will give one quote from that—and, again, it is not in any way impugning the integrity or professionalism or the outstanding nature of this somewhat long PhD. With this quote, I was a bit concerned about whether the independence of the appointments was truly up to the standard we would wish to see:
“Granting an authority the power to legally regulate the football industry, compelling all English football clubs to comply with the established economic framework or risk being unable to use their football facilities, thereby prohibiting the club from playing in any football competition, either domestic or international, would transfer economic power back from the clubs and leagues to the regulatory authority, reversing the process initiated by the creation of the EPL in 1992”.
That is a fairly major statement that counterbalances the Premier League’s autonomy and would question the true independence of the proposed independent regulator.
I have not had the opportunity to read the whole thesis. I look forward to doing so, and to reading any other public documentation through LinkedIn. I think it is incredibly important that, if we are going to have an independent football regulator, that regulator has to be truly independent. All the appointments need to be made on merit, bringing in the very best people in regulation from across the country, and indeed possibly from abroad, to fulfil those important responsibilities and posts. I would be grateful if the Minister could give us the confidence that that is exactly what is being pursued.
Baroness Twycross (Lab)
I thank the noble Baroness, Lady Brady, and the noble Lords, Lord Moynihan and Lord Parkinson of Whitley Bay, for putting forward these amendments.
On Amendments 112, 113, 114, 115 and 117, in the name of the noble Baroness, Lady Brady, we clearly agree that producing guidance will be a really important part of the regulator’s work. It will help to clarify the practicalities of the legislation and ensure that clubs’ owners and competition organisers know what is expected of them and what to expect from the regulator. However, while I recognise the intent of the approach proposed, I disagree to some extent with the approach to guidance that the noble Baroness, Lady Brady, has suggested we take. Amendments 112, 113, 115 and 117 would require the regulator to produce guidance on all aspects of its functions. This is likely to be a disproportionate and needlessly burdensome requirement that would likely end up being more unhelpful than helpful.
There is little benefit in issuing guidance on issues that are self-explanatory or that do not have a direct impact on the industry. I will endeavour to find some examples of that type of guidance to meet some of the queries from noble Lords—for example, on every one of the regulator’s operational or administrative functions, excessive guidance would make it harder and more burdensome for clubs to understand and comply with the system, not easier, and National League clubs would potentially struggle to sift through reams of guidance to get to what was relevant to them. We expect that the regulator will publish guidance on all relevant parts of its regime, as appropriate. It is in everyone’s interests to maximise the industry’s understanding and compliance.
On Amendment 114, in the name of the noble Baroness, Lady Brady, the regulator is already required to publish guidance on how it will use discretionary licence conditions, including the outcomes it seeks to achieve. We believe that this requirement is sufficient, and it will be for the regulator to determine what that guidance should look like and how best to aid the industry without unduly burdening it.
I turn to Amendments 116 and 118, in the name of the noble Lord, Lord Parkinson. Amendment 116 would require the regulator to prepare and issue a code of practice for all competition organisers and licensed clubs. We do not believe that a code of practice for all clubs would allow for a proportionate, tailored approach to regulation, where what is required of a club should vary depending on the club’s specific circumstances. The regulator’s current approach of bespoke regulation will address the unique challenges and risks faced by clubs better than a list of one-size-fits-all recommended measures, and its guidance, as per Clause 12, should already help clubs to understand what is required of them and to comply.
On the points raised by the noble Baronesses, Lady Brady and Lady Evans of Bowes Park, on Amendment 118, the regulator is already required to consult such persons it considers appropriate when publishing guidance. We strongly expect that this will include the FA, competition organisers and regulated clubs, since those persons will all be directly relevant to and affected by that guidance. However, we have not taken the approach in this Bill of listing every person the regulator should consult for every piece of guidance issued. To do so would, in our view, be counter to the operationally independent and agile regulator that we are trying to establish.
There may be times when different levels of consultation are necessary, or with different stakeholders. The regulator is best placed to draw the line between comprehensive consultation and needless bureaucracy, and to ensure that the correct groups are consulted on a case-by-case basis. On the specific consultation requirements in the Bill, including on guidance, the regulator has a regulatory principle that it should co-operate and proactively and constructively engage with clubs, owners, officers and competition organisers. I hope that that gives the noble Baroness, Lady Brady, some confidence around the collaborative points she raised. This amendment would require the regulator to consult on minor revisions to guidance, needlessly creating an administrative burden for the regulator and those consulted.
Finally, Amendment 119, in the name of the noble Lord, Lord Parkinson, and Amendment 119A, in the name of the noble Lord, Lord Moynihan, relate to the Secretary of State guidance in Clause 13. Amendment 119 seeks to extend the period that the Secretary of State cannot amend guidance on the regulator’s functions from three to five years. While the regulator must have regard to the Secretary of State’s guidance, as an operationally independent body it will not be obliged to follow it. The industry and fans alike have been clear that they do not want to see excessive ongoing government involvement in football. That is why the Secretary of State may not revise this guidance any more frequently than every three years. The Secretary of State must consult both the regulator and anyone else they consider appropriate before publishing or revising any guidance, and must lay the guidance before Parliament. While I appreciate the concerns of undue influence, extending this to five years, when there may be an issue that needs clarificatory guidance before then, would be sub-optimal.
On Amendment 119A, I agree that the regulator should be independent and free from government influence. I do not have the level of detail that the noble Lord, Lord Moynihan, requested. However, I am confident that appointments will be made on merit. I will write to him with additional detail following the debate. Secretary of State guidance on this point would be unnecessary. The employees of the regulator will already be independent from the Government, like other regulators in the country. Independence has been at the heart of the regulator’s design, with it having sole discretion over its operational decisions. The aims of this amendment are therefore already achieved by the Bill’s current drafting.
I have noted the points from across the Committee on the amendments in this group and I am happy to discuss these further ahead of Report. However, for the reasons I have set out, I hope the noble Lords will not press their amendments.
Lord Addington (LD)
I take it that we have a consensus that there should be some way to find out what the regulation is and the reactions to it. Will the Minister give us an assurance that it will be published somewhere we can find it? That is the real point.
Baroness Twycross (Lab)
Perhaps the noble Lord could clarify whether he means once the regulator is up and running. I assume so. It would be very unusual for that to not be the case, but I will confirm that and get back to him, I hope, in the course of the evening.
Baroness Brady (Con)
My Lords, I thank the Minister for her response and for the points raised. I note her desire not to put any major burdens on the regulator, but I worry about the major burdens that that in turn puts on the 116 football clubs that this regulation affects.
I respectfully push back on the notion that the amendments are not necessary or that the IFR’s flexibility would be somehow unduly constrained by requiring proper guidance and consultation. Perhaps the Government could look at it another way: amendments of this sort could actually enhance the regulator’s ability to act effectively by building trust and clarity from the outset. That is really what the football clubs want: clarity.
The Minister points to collaboration, yet the Bill imposes no duty to consult on key areas such as financial sustainability, the owners’ and directors’ tests or the backstop powers. Without clear consultative frameworks, football will face uncertainty and investment decisions could stall. Football is a global business and investors require regulatory predictability. These amendments are not about adding bureaucracy but about ensuring that clubs, leagues and investors understand how regulatory powers will apply—that is what this is about.
Instead of creating unnecessary delays, the amendments, or amendments like them, would prevent regulatory uncertainty, providing everyone with a clear framework for guidance. Reactive and unclear regulation is likely to create much greater delays and generate a higher workload for the regulator and the clubs. I remain concerned that the existing provisions do not address the scale of the regulatory powers that the Bill is creating. The regulator will oversee billions of pounds in football revenue, critical tests of ownership and sustainability of the entire pyramid. We are the first country to do this and, in my view, these very wide-ranging powers demand the highest levels of transparency and consultation. Football deserves a regulator that collaborates in practice, not just in promise.
That said, I am somewhat—I repeat somewhat—encouraged by the Minister’s recognition of the importance of these issues, as reflected from all sides of the Committee. I hope that we might continue to engage on how best to embed these principles within the framework of the regulator. I will reflect further on her response and I hope we can consider how these concerns might be addressed as the Bill progresses. For now, I beg leave to withdraw the amendment.
Lord Markham
“Delegation of regulatory powers to competition organisers(1) The Secretary of State may by regulations direct the IFR to delegate some of its functions under this Act to specified competition organisers.(2) For the purposes of subsection (1) the IFR may only delegate a function to a specified competition organiser if it is satisfied that the competition organiser—(a) would discharge the function delegated under subsection (1) with the same degree of stringency as the IFR;(b) would discharge the function delegated under subsection (1) with regard to the IFR’s objectives under section 6;(c) would discharge the function delegated under subsection (1) with regard to section 7(2);(d) would not alter or disregard its obligations under this section.(3) If the IFR is satisfied that the specified competition organiser meets the conditions set out in subsection (2), and the Secretary of State has directed the IFR to delegate a function under this Act, the IFR must abide by the Secretary of State’s direction.(4) If the Secretary of State is not satisfied that the IFR has taken all reasonable steps to comply with the direction to delegate a function under subsection (1), then the Secretary of State may take such action as is deemed necessary to ensure the IFR does comply.”
Lord Markham (Con)
I hope noble Lords will see this as another constructive measure that is in keeping with many of the issues on which there has been broad consensus in the Committee. The principle behind the amendment is delegating regulatory functions to the competition organisers where they are considered best placed to discharge them.
Many noble Lords have said that the competition organisers already regulate their own competitions to a large degree. We are all aware of the fit and proper owner test and of financial fair play, to mention just a couple of areas. We would all agree that competition organisers have extensive experience in this space, having been doing it for a number of years. If they were discharging a lot of the functions and the regulator was also discharging them, there would be the danger of duplication. Again, I think most noble Lords want the regulator to be light touch and low cost, particularly as all the costs are coming out of the pockets of the clubs.
I hope that this will be seen as a sensible move. The regulator would be asked to look at each area of responsibility and to decide which of the competition organisers might be best placed to carry it out. If the regulator thinks that, in delegating some of those powers, the current Premier League or EFL owner tests are insufficient, there would be nothing to stop the regulator saying that, on top of competition organisers’ existing processes, it would like them to add X, Y and Z. That would be entirely appropriate and would give the competition organisers the opportunity to prove themselves.
Given that the regulator would have overall responsibility, it would always have the opportunity to take the powers back if it thought the competition organisers were not up to the job. Amending the Bill in this way would be seen as a sensible move. It would send a good signal to football that we want to work with it in setting up the new regulator. We have all heard the Minister say that she does not want to increase the burdens on the independent regulator—in fact, she made that point in responding to the last group—so here is a way to reduce the burden we put on the regulator and to delegate it to a local level, where others are felt best placed to carry out the functions in a collaborative way. I beg to move.
Lord Pannick (CB)
The noble Lord, Lord Markham, puts his case very powerfully but I for one am not persuaded, because the delegation of functions to competition organisers would frustrate the very purpose of independent regulation. The whole purpose is that regulation is done by the independent regulator. As I said in considering the previous group of amendments, it is of course vital that the regulator consults those affected and takes into account their concerns and expertise. But to delegate the responsibility to those who are being regulated, or to the competition organisers, would be an abdication of regulatory responsibility.
Lord Maude of Horsham (Con)
My Lords, I support the amendment of my noble friend Lord Markham and strongly disagree with the noble Lord, Lord Pannick. We constantly hear that the purpose of the Bill is for the regulator to be agile, to be as light touch as possible and not to impose unnecessary additional burdens on football. Every million pounds spent on the cost of running the regulator, as well as the additional compliance costs for football clubs themselves, means there is less of the pie to be distributed under the redistribution parts of the Bill.
Surely one of the key ways in which we can do our best to avoid that cost burden being excessive is to avoid duplication. The reality is that the competitions, the leagues, already exercise a self-regulatory function—not regulating themselves but regulating the clubs that are members of the leagues. That is in their nature: there are conditions of belonging to those leagues that they rightly enforce, and they are going to be obliged to carry on doing that anyway. It is possible that not all of them have done that perfectly, and that not all of them will continue to do it perfectly in the future, but it is also possible that the independent regulator will not do its job perfectly. We should consider that possibility at this stage of consideration of this really important Bill, given that many clubs—not just the Premier League clubs but right down through the pyramid—have concerns about the costs, imposition and impact that creating the regulator will involve. When we move on to the next group, we will be looking at the really big, crunchy part of the Bill that covers the regulator’s operating licensing powers.
If we are to be sensitive to these genuine concerns of football clubs—which, by and large, have been pretty successful over the decades—this is a good way of showing it. If this amendment is passed and accepted by the Government and goes into the Bill, none of it says that the powers have to be delegated to any particular competition organiser; but at least giving the possibility of avoiding this overburden of new regulation, cost and impositions on something which is already very successful would be a very good signal for the Government to send.
I hope the Minister when she responds to this amendment will not rule it out out of hand but will take it away and say that we should now be looking for ways to address some of these genuine concerns. This would be a very good way of doing it.
Lord Goddard of Stockport (LD)
My Lords, I rise to comment on the amendment of the noble Lord, Lord Markham, which, on the face of it, sounds sensible, obvious, simple, light touch and low cost. I rise also to defend the noble Lord, Lord Pannick, for pointing out the blindingly obvious biggest bear trap of the entire Bill up to now: delegating the power of the regulator to the very people it is trying to regulate. It would seem to any right-minded person that this is the least sensible thing to do. Being concerned about the power of the regulator but trying to persuade us that it could give some of its powers up to someone else to help them along the way defeats the object of having the regulator.
Lord Maude of Horsham (Con)
Before the noble Lord sits down, there are two groups which, if the Bill goes through and is enacted, will be subject to regulation. There will be the competition organisers, of course, but the biggest burden will be on the clubs themselves, and that should be our principal concern. If the competition organisers, who would themselves be overseen by the regulator, are able to discharge the regulatory functions effectively without creating a whole new panoply of compliance and enforcement mechanisms and apparatus, surely that is worth looking at and considering.
Lord Goddard of Stockport (LD)
There is some merit in what the noble Lord says. The noble Lord, Lord Addington, and I met Rick Parry and some people from the EFL this week and they are quite content with this. They do not see this as an onerous burden on them. They are looking forward to the regulator, a level playing field and a real chance for them to progress, so they are not going to oppose this resolution.
Lord Hayward (Con)
My Lords, in relation to consultation, on which several comments have been made during the discussions on this and previous groups, it is worth bearing in mind, when the Minister tells us that there will be wide consultation in whatever circumstances, what my noble friend Lady Brady said on day one of Committee. She said that the Government had consulted seven Premier League clubs, which did not include Manchester City. They consulted those seven clubs for about as long as it took Spurs to score four goals against Southampton yesterday. It was hardly serious communication and consideration. That is what worries so many of us: we are listening to a series of comments that sound reasonable in themselves—and I have sympathy with what the noble Lord, Lord Goddard, said—but I would believe it if there had been a very clear indication at previous stages of the Bill that there had been consultation with the interested parties.
Baroness Brady (Con)
My Lords, I support Amendment 124. I think it introduces a sensible and proportionate idea: that the independent football regulator should have the power to delegate certain functions to competition organisers, such as the Premier League, the EFL and the National League, where it is appropriate. First, I want to consider the position of the leagues themselves, especially the Premier League and the EFL, both of which already play central roles in the regulation and operation of English football. These organisations are not merely administrative bodies; they are sophisticated, well-sourced entities with established systems for financial monitoring, licensing and governance.
For example, the Premier League currently performs all the UEFA licensing for clubs on behalf of the FA, demonstrating its capability to operate efficiently and effectively under stringent regulatory frameworks. It also has robust financial monitoring mechanisms in place, which ensure that clubs comply with obligations relating to profitability, sustainability and long-term planning. As I mentioned earlier in Committee, the Premier League also invests significant resources and time in performing its owners’ and directors’ tests to a very high standard, and intends to continue to do so.
Simply duplicating all these existing structures within the IFR would be inefficient and burdensome, as the White Paper that led to the Bill rightly acknowledged:
“The Regulator may wish to allow concurrent systems, or delegate responsibilities to industry bodies, in certain circumstances. It would manage this in a way that is coherent and simple for all involved, especially clubs”.
Unfortunately, however, no sensible delegation power currently exists in the Bill, so I commend my noble friends Lord Markham and Lord Parkinson for addressing this issue and allowing for this conversation. This amendment would align perfectly with that principle expressed in the White Paper. It would be a smart, almost unarguable step to take: delegation would allow the regulator to focus its resources, especially in the early years of its life, on areas where independent oversight is essential, such as addressing market failures and managing systemic risks. At the same time, it would give the regulator the option of leaning on existing processes or information systems where they are already successfully implemented.
Delegation would also address an important practical reality. The workload facing the IFR will be immense. I am not surprised that the EFL wishes to offload some of its costs to the regulator, and that is its right. In its early years, this regulator will have to establish itself, build capacity and gain the trust of stakeholders across the ecosystem. That is a big burden. Allowing it to delegate certain functions, with appropriate safeguards, ensures that it can deliver its objectives without being overwhelmed by administrative tasks that others are well placed to manage.
However, this clearly cannot be done on blind trust. The amendment includes what seem to be important safeguards: the IFR must ensure that any competition organiser meets the same degree of stringency, aligns with its objectives, and adheres to its regulatory principles. This would seem to protect the integrity of the regulatory framework, while avoiding unnecessary duplication and, therefore, unnecessary cost.
More broadly still, this amendment raises an important question that we must address about the future role of the Football Association. While the fan-led review’s position was that the FA’s current governance arrangements make it unsuitable to house the IFR at present, it also envisaged a scenario where one day this might change. As the review noted,
“the FA might at some point be a suitable location for IREF … However, the Review has concluded that this is not appropriate at this time”.
This amendment raises the possibility of the delegation of certain functions to the FA, as part of its reform journey. If the FA continues to modernise its governance structures and demonstrate the capability to take on certain functions, it could play a much larger role in football’s regulatory framework.
Indeed, I encourage the Government to consider including the FA in the scope of this clause as such, because it should meet the same rigorous criteria that the leagues have to. Delegation to football bodies could be tied to a broad review of football governance a few years into this regime. This review could assess not only the progress of the IFR but the readiness of the FA and other football bodies to take on greater responsibilities. This will ensure that the IFR can be a dynamic institution, evolving in response to the needs of the game and empowering existing bodies to step up, where it makes sense. I believe that all stakeholders, including the most ardent supporters of the fan-led review, as well as those worried about the unintended consequences of this delegation, could support this kind of sensible amendment.
Finally, but most importantly, in a letter sent to me by the general-secretary of UEFA only last week, he said:
“UEFA appreciate the background of the Football Governance Bill discussions and proposals, and we were encouraged by the intent of the original Fan Led Review which stated that this regulatory area should be returned to The FA in time. UEFA supports The FA and UK policymakers in ensuring that this is still the case”.
The FA told me, also last week, that it has recently told DCMS that
“the FA is willing to take on delegated powers from the IFR, if there are services that the regulator believes we can operate and deliver effectively”.
I ask the Minister: is it still the case, as UEFA and the FA seem to believe, that the Government intend the future delegation of powers to be handed back to the FA at some point? If it is, surely this is an amendment that the Government could and should support.
Lord Sentamu (CB)
My Lords, I have spoken only once—about my little club, York City—but I have attended all the Committee debates. First, I think that York City will find it puzzling if, for the first time that there is an independent regulator, the same Act will say that some functions will be delegated. That is a confusion. Down the road, that might be thought about, but we want to see this person—man or woman—who will be the independent regulator doing the job. If it becomes an impossibility or too burdensome, it is at that stage that you delegate. But to say in the Bill, right at the beginning, that certain functions will be delegated, maybe to some powerful clubs, will be a confusion.
Secondly, no one would want to be an independent regulator. If I had the ability to do so, I would tie down the job, because, otherwise, it muddies the water. What we have not teased out a bit more, unfortunately, are the amendments from the noble Baroness, Lady Brady, on consultation—that is the key bit. I hope that the Government will think through those amendments, because, without consultation, the little club of York City would think that somebody wants to swallow it up.
Remember that all football clubs are like tribes. They will defend their colours and their game. The only way to deal with tribes is to make sure that they are consulted. I think this amendment is unhelpful at this stage. Let us see what happens with the kind of regulatory power that is created. This independent person must actually be independent.
Lord Parkinson of Whitley Bay (Con)
My Lords, I want to say a little about Amendment 124, which my noble friend Lord Markham has outlined and to which I have added my name. I am sorry that we have not yet fully convinced noble Lords across the Committee in favour of it, but it might be helpful to clear up some of the confusions which have arisen.
We are proposing delegating these duties not to clubs but to competition organisers. In doing so, we seek to avoid the sort of confusion that the noble and right reverend Lord, Lord Sentamu, has just highlighted about duplication in the regime. As noble Lords have pointed out, there are already football bodies which have a regulatory role—the Football Association, the Premier League, the English Football League and, indeed UEFA. They will retain many of those functions. As the noble Lord, Lord Pannick, knows well, Manchester City’s dispute with the Premier League is because of its powers to make some of the rules for the competition to which it relates. We are trying to avoid the duplication of regulatory functions. If an existing competition organiser has processes in place to carry out these functions effectively, why could the Secretary of State not direct the regulator to delegate them to these competition organisers and bring them closer to the clubs that are playing in that competition of their own free choice?
Lord Pannick (CB)
The noble Lord emphasises that the purpose of the amendment is to allow for delegation of powers to competition organisers, not to clubs. But the noble Lord will know that the Premier League, which is a competition organiser, simply consists of the will of the 20 clubs.
Lord Parkinson of Whitley Bay (Con)
The 20 clubs have competed to get into it. It is a changing 20, based on the ability of clubs to take part in that competition.
Similarly, it might be more appropriate for functions to be carried out by other competition organisers at other levels of football, if there are sufficient safeguards for them to do so in a way in which the Secretary of State feels is appropriate.
In our amendment, we have tried to reflect these safeguards to make sure that the same regulatory standards apply to the bodies to which functions are delegated. Subsection (2) of the new clause proposed in Amendment 124 says that a function can be delegated only if the regulator is satisfied that the competition organiser would discharge the function with the same degree of stringency as the regulator itself and that it would meet the objectives established by Clause 6 and discharge the function with regard to the negative outcomes as outlined in Clause 7(2).
We are where are because there are elements of football which have not been good at self-regulating in a way that has pleased fans. More than one political party has been concerned enough to bring this Bill before your Lordships’ House. Are we saying that we have reached a point of no return? If the competition organisers and other football organisations get their house in order and meet the standards set out in this Bill which the regulator is trying to do, will there never be a situation in which we will be able to delegate some of these functions back down to the level of competition organisers? This would mean a much more light-touch, organic form of regulation, which I think is what a lot of noble Lords in the Committee would like to see. That is the thinking behind the amendment and on which I would be interested in hearing an answer from the Minister.
Lord Maude of Horsham (Con)
Picking up the point that was made by the noble Lord, Lord Pannick, particularly focusing on the Premier League, we have discussed in previous debates on this Bill the league’s concerns that the burdens of new regulation and compliance costs fall more heavily on smaller clubs than on big ones. Looking at the effect of this, my concern is how this amendment would operate if it were to be incorporated in the Bill. I would expect the Secretary of State to be looking in the first instance at the lower leagues, as that is where the pain will really be felt of imposing new burdens.
Lord Parkinson of Whitley Bay (Con)
My noble friend makes an important point. It may also be in the lower leagues that we see the examples of better behaviour. The Secretary of State may then feel that it is right and proper to delegate some of these functions to the competition organisers for the clubs in the lower leagues.
Baroness Twycross (Lab)
My Lords, before I respond to the points that have been raised, I want to respond to the point raised by the noble Lord, Lord Addington, in the previous group, in relation to the regulator’s guidance. I can confirm that the regulator’s guidance will be published. Clause 12(5) of the Bill states:
“The IFR must publish any guidance”.
I also want to clarify a point raised by the noble Lord, Lord Hayward, because I am concerned that if I let it lie then, at a later date, somebody may suggest that it was accepted. It was that only seven clubs had been met with. I stress to your Lordships’ House that this Bill is the culmination of almost five years’ work which started in 2019. Officials have had extensive regular engagement with key stakeholders, including with the clubs which will be subject to the regulation. All clubs have had a number of formal opportunities to share their views, particularly as part of the fan-led review and the football governance White Paper. Over this five-year period, DCMS has had hundreds of meetings with clubs, leagues, fan groups and other stakeholders. No club that has requested a meeting has not had one. I hope that clarifies that point.
Lord Hayward (Con)
While I understand the Minister citing a series of meetings that have taken place over a number of years, we are now talking about a Bill which has been introduced by this Government with changes from the previous Bill. Some of those changes have already been debated, and some have not. Surely, it behoves the Secretary of State and any Minister within a Government to have slightly more than a half-hour conversation with seven members of the Premier League when we know that they are going to be the most affected clubs in terms of cost burdens.
Baroness Twycross (Lab)
The noble Lord and I may need to agree to disagree on the level and extent of the consultation. The culmination of consultations between officials and the various meetings that have taken place constitute very sound consultation. I was concerned that it might appear to your Lordships and to people externally that only seven clubs had been met during the whole course of the design of a new regulator, which I think all noble Lords would agree would be highly unusual and undesirable. I may return to that point; noble Lords may raise it again in Committee. I look forward to further discussion of what constitutes consultation.
I thank the noble Lord, Lord Markham, for his Amendment 124, which creates a mechanism for the regulator to delegate its function to the competition organisers. I understand that some noble Lords believe that the regulator should act as an overseeing body, only acting through the leagues and only stepping in once the leagues have failed to address a problem or, in some instances, not wishing the regulator to exist at all. Without wanting to disappoint noble Lords, including the noble Lords, Lord Maude of Horsham and Lord Hayward, the noble Baroness, Lady Brady, and others who support this amendment, I am afraid that the model of regulation is not one that we are proposing and nor is it the model that the previous Government proposed. Notwithstanding the points that have been raised repeatedly, this is now this Government’s Bill and we are very proud to bring it before your Lordships.
The fan-led review laid bare the issues with industry self-regulation, and this is an amendment where it is important for your Lordships’ Committee to reflect on the fact that football has had ample opportunity to get this right. We are legislating only because the leagues do not have the incentives and governance structures to address these problems adequately.
I agree with the point made by the noble Lord, Lord Goddard of Stockport, that this amendment could be argued to represent a bear trap. I also agree with a number of points raised by the noble Lord, Lord Pannick, and the noble and right reverend Lord, Lord Sentamu. As has been demonstrated, compliance with current competition organiser rules has not proved an effective way of ensuring sustainability of the game. That is precisely why a new bespoke regulator is required, with the powers, incentives and agility to act where competition organisers are unable to.
However, I want to reassure the noble Lord that the regulatory system is already designed in such a way that the regulator should not need to intervene if the required standards are already being met. If clubs are meeting their threshold requirements naturally—for example, through their compliance with the industry’s existing rules—then the regulator will not need to apply discretionary licence conditions. There is also the more formal
“Commitments in lieu of … discretionary licence conditions”
mechanism, where leagues will be given an opportunity to address specific identified financial problems so that the regulator does not need to attach a licence condition.
Beyond this, however, we do not believe that the regulator should delegate functions to the leagues—there would be a significant issue of accountability. In a case where a function was delegated and serious failings happened, accountability would then be hard to ascertain. We also do not think that a power for the Secretary of State to direct the regulator would be appropriate. Not only could that constitute undue political influence on the regulator but it would also open the door to continuous lobbying by competition organisers for regulation to be delegated to them. What is more, the amendment would allow the Secretary of State to give this direction and for regulation to be delegated back to the industry without any prior parliamentary scrutiny.
On the points raised by the noble Baroness, Lady Brady, about the FA’s willingness to take on delegated functions, my department continues to have discussions with all stakeholders, including the FA, on a range of issues. It is encouraging that there is willingness in the industry to tackle the problems of financial sustainability. However, as the fan-led review clearly showed, the industry has not proved able to take forward the reforms needed at this time due to the governance and constitutional arrangements in place, as well as lacking the expertise required to deliver the regime we have been discussing. An independent body free of industry influence is needed; now is not the time to delegate functions. However, as with all aspects of the Bill, the Government will keep under review the effectiveness of the regime to deliver regulation. For these reasons, I am unable to accept the amendment, and I hope the noble Lord will withdraw it.
Lord Parkinson of Whitley Bay (Con)
I thank the noble Baroness. Is she saying therefore that we are, in essence, past the point of no return in relation to some of the competition organisers? I take what she says about the discretionary licence conditions that are available to the regulator that give it a bit of leeway with those that get their house in order, but if football were to get its act together, does she not foresee a circumstance in which some of the functions that are going to be given to the new regulator could be given to organisers, whether at the direction of Secretary of State, or by the choice of the regulator?
Baroness Twycross (Lab)
I agree that statutory regulation should exist only where it is necessary. In our view, the regulatory system is already designed to be proportionate so that intervention can automatically scale up and down as needed. Clubs that are already well run and are lower risk should not face additional requirements. We want standards in the industry to improve, and if this were to happen and the market was derisked, I would expect the regulator to be less involved and less noticeable. I want also to stress that the regulator will not stop the leagues imposing their own competition rules so long as they do not conflict with the regulator’s regime. However, this is not an amendment which we feel would serve the sector well, and that was why I asked the noble Lord to withdraw it.
Lord Markham (Con)
I thank noble Lords; it has been a genuine exchange of views. I am also glad that it gave an opportunity for the noble Lord, Lord Hayward, to make a positive point about Spurs over the weekend—and that there was a positive point available to be made about Spurs.
I genuinely appreciate the constructive challenge that we have had in this debate. I feel that there has been a bit of a misunderstanding, however. When we say that we are asking for delegation, as in contracting out the function, it is not abdication, because the independent regulator will always be ultimately responsible for that decision. It always has the final say. It is just trying to adopt the policy, which I think many of us believe in, in terms of devolution or subsidiarity—call it what you want—but it is another form of trying to make sure that the power is as close to the coalface as possible, at the same time always giving the opportunity for the regulator ultimately to make the decision. As my noble friend Lady Brady said, this point was absolutely envisaged in the White Paper. The FA and UEFA welcome it, and I must admit that I cannot see why we would not want those who are closest to it to have responsibility first.
Again, I want to clear up that I am not talking about the clubs; they are different from the competition organisers. The clubs and the Premier League, for instance, have very different views, as we have seen recently on financial fair play. The amendment is about giving those regulatory bodies—such as the FA, the Premier League and the EFL—an opportunity, where they are best placed to do it, to make those decisions themselves. If the regulator does not agree with that, ultimately it always has the final say.
I hope we will be able to return to this, because I hope it would demonstrate the collaborative approach that all noble Lords and the Government are trying to bring. I know that it is what we have all said many a time in this debate as well. At this stage, I beg leave to withdraw the amendment.
Lord Parkinson of Whitley Bay (Con)
My Lords, I rise to oppose the question that Clause 15 stand part of the Bill—and, indeed, Clauses 15 to 25. I do that not because I disagree wholeheartedly with this huge swathe of the Bill but because it provides opportunity to ask some questions about the nature of the licensing regime, which these clauses relate to. I hope that the Minister will be able to answer those questions and assuage some of the concerns that lie behind them.
I want particularly to discuss how the Government plan to deal with the possibility of clubs seeking to leave the licensing regime en masse. What would be their response if football clubs simply wished to be unlicensed? If several clubs opted out of the regime and established a rival competition, how would that work in practice?
We have touched on this a little but not in great depth and, when we have, the Minister has said that the Government’s solution and the design of the Bill for clubs that attempt to skirt around the legislation and operate in an unregulated competition would simply be to use the delegated powers in Clause 2(3) to make such a competition a specified and regulated one. There would be a sort of game of cat and mouse if that scenario played out. The Minister has argued that allowing this to happen in delegated powers allows for greater agility, but it is worth pondering just how much agility it really can deliver. A statutory instrument made under Clause 2(3) is subject to the affirmative procedure as per Clause 91. It therefore must be laid before both Houses of Parliament and approved by a resolution of both Houses. There is therefore a limit on how swiftly the Government would be able to make such regulations and have them approved by Parliament.
It is worth also drawing attention to how this new licensing regime will interact with the existing licensing requirements from league organisers and UEFA. How do the Government envisage the regulator working with those bodies, which already license clubs, to prevent duplication of regulations and unnecessary further burdens?
Amendment 173 in this group, which stands in the name of my noble friend Lord Markham, would remove the power of the Secretary of State to amend discretionary licence conditions by statutory instrument. This provision of the Bill is yet another example of where we do not have sufficient clarity or certainty for clubs and of the open-ended powers for the Secretary of State. Once again, we see a scenario in which the clubs will have to abide by rules but without the requisite certainty to enable them to plan effectively for the future. Today, we are debating the discretionary licence conditions in the Bill, but allowing the Secretary of State to amend the conditions specified in the Bill on a whim, if he or she wishes, surely defeats the purpose of putting them in the Bill in the first place.
Lord Bassam of Brighton (Lab)
My Lords, I will speak to Amendment 128, which gets to the nub of what the licensing regime should be looking at. It would require a personal statement to identify a club’s ultimate owner and that owner’s source of funds. It is really quite an important amendment because clubs, and fans in particular, have the right to know where the club’s money is coming from.
This is prompted by things that have happened to clubs in the past, when it has been quite clear to the outside world that clubs do not have the means—because their owners have failed to provide any detail or background on their own finances, despite having given assurances—to identify where their funding is coming from. I cite the case of Dr Tony Xia, who became the owner of Aston Villa back in 2016. He was approved as an owner by the football authorities, yet it later turned out that he had neither the money nor the resources. The club ended up just a week away from being unable to meet its tax liabilities.
Following the 2021-22 season, a survey of 92 clubs looking at data on wages and cash reserves revealed that many clubs, up to a senior level, were very close to not having the reserves that would ensure that they could meet their liabilities, pay wages and so on. Some clubs are very good at this—West Ham United is one of them and, apparently, Plymouth Argyle was one of the most financially secure that season, along with AFC Wimbledon and Tottenham Hotspur.
If we are seeking transparency through the licensing regime, it is clear that we will need to understand who the owner is, where their funding is coming from and how much that will kick in to ensure the safety and security of clubs for the benefit of their fans.
Lord Maude of Horsham (Con)
My Lords, I have a concern with the whole of this part of the Bill and the way in which operating licences will be required and the adjudication made upon them. This part of the Bill is nine very dense pages of text, backed by three or four schedules. At various stages, it includes such dark phrases as:
“An application must be accompanied by … such other information and documents as may be specified by the IFR in rules”.
I used to be a lawyer, a long time ago, and I am reasonably accustomed to reading Bills and Acts, but when I start to read through this part of the Bill I can feel my lifeblood draining away. What of the owner or board of a small club looking at what will be required of them?
I noted that in the Minister’s winding up of the last debate she said that well-run clubs have nothing to worry about, which was meant to be reassuring. It does not matter how well-run a club is; it will have to comply with all this, and it will have to set itself up with lawyers, consultants and accountants to draw up a strategic business plan. A lot of clubs will not have a strategic business plan. That does not mean that they are badly run, but they will have to prepare such a plan. A strategic business plan is a document containing the proposed operation of a club: its estimated costs, how those costs are to be funded, the source of such funding and other information as may be specified by the IFR. That does not get done spontaneously or arise automatically.
The reality is that this is a very demanding regime intended to be put into law and enforced by the new regulator. I wonder whether there has been sufficient consideration given to putting in place a halfway-house system of regulation. Think about how companies are regulated: it is a requirement that, if you set up a limited company, designed to limit the personal liability of owners of the company, it is registered with Companies House. By law, certain listings are required and a certain amount of information has to be made public, including the filing of accounts. However, you do not have to get consent from a regulator to set up a company; you just have to register that it is in existence and subject to the laws that apply to it.
As we know, the state of football is pretty strong, stable, vigorous and successful compared with football in other, similar jurisdictions to ours. Have we given sufficient consideration to whether it might be good to take time, before we require small clubs up and down the country—which are not necessarily finding it easy to get through from week to week, month to month and year to year—to submit to this horrendous set of requirements just to get a licence to get on to the field of play in the first place, before they even set about winning a match, to go back to the drawing board and construct a regime that would require clubs to register in the same way that a company is registered, subject to rules and requirements for disclosure and transparency, and to changes being registered. That would reduce hugely the burden on clubs and would start to introduce the kind of consistency which, for reasons that I totally understand, is being sought.
I oppose the whole of Part 3 and its accompanying schedules—I am not even going to think about the plethora of regulations, guidance and further verbiage that will come out of it—standing part of the Bill.
Lord Addington (LD)
My Lords, it might be convenient for me to say a few words on this. Primarily, I am drawn to the amendment from the noble Lord, Lord Bassam, for the reasons he gave. We have heard that this is a wonderful, successful league. Bits of it are but, unfortunately, those are the bits at the top. Most of the cultural capital, I am afraid, is in the less glamorous clubs with less successful balance sheets.
We have a situation where we want to maintain the whole of the football structure: five leagues. This has proven to have—let us say—attracted financial irregularity; I think it was described as “chancers and fantasists”. We have to do something to stop this or we will start to have more disasters that mean something to the fan base.
The amendment from the noble Lord, Lord Bassam, starts to address this. I hope that the Government are far more in tune with that amendment than with some of the others in this group.
Baroness Grey-Thompson (CB)
My Lords, I rise briefly to speak to Amendment 128. We are getting to the crux of what this regulator should be about: making sure that there are sensible financial decisions, and that risks are mitigated so that they do not jeopardise clubs’ futures.
Clubs in the EFL are expected to lose around £450 million this season and are reliant on owners to fund the shortfall. If this funding is not forthcoming, it can lead to financial trauma. Only 66 of the 92 clubs that filed accounts for the 2021-22 season included data on wages and cash reserves. Nottingham Forest spent £58,606,000 on wages but had just £25,000 in cash reserves—five hours’ worth of reserves. Surely that cannot be acceptable.
Lord Moynihan (Con)
My Lords, I will speak to the amendments standing in my name in this group. I apologise to my noble friend Lord Maude if I address some of the plethora of regulations, conditions and verbiage concerned. I am proposing a number of amendments that I hope will facilitate and ease the position that the Government face in this context.
I turn to my Amendment 169A. It is unclear from my reading of the licensing section of the Bill whether the IFR is expected to produce a detailed and granular set of financial rules that would be applied in a blanket way to a large class of clubs or leagues; examples include the specific liquidity ratios, the debt-to-equity ratios, operating cash-flow metrics and size of financial buffers. Or will the IFR take an entirely bespoke approach, where every club will have DLCs—discretionary licence conditions—applied according to their own circumstances? That would drive a coach and horses through the competition organiser’s ability to provide a level playing field and maintain competitive balance. The third option is that the IFR could take an outcomes-based approach whereby it produces some high-level guidance with clear outcomes that clubs must achieve and league rules sitting underneath, giving effect to these principles and outcomes. For example, the IFR could have a series of outcomes relating to working capital, transitionally financed balance sheet health, resilience, protection of assets, et cetera. Leagues could colour in these outcomes into rules.
My own strong preference is for the third option. This amendment, which characterises the third option, is designed to create space for that conversation and, hopefully, allow the Minister to say that, where existing sustainability rules are in place and working, there will be an opportunity for that kind of league-led approach at all levels within an overall regulatory framework. Therefore, my recommendation is an outcome-focused, light-touch regulation, with step-in powers where issues are identified. That is why I have drafted Amendment 169A.
I turn to my Amendments 167A, 168A and 168B. The current test for attaching and varying a discretionary licence condition sets an extremely low bar for the IFR. For example, it seems to me that the test could be met in the case of a club that is already meeting the threshold requirement, on the basis that a discretionary licence condition somehow contributes to the club continuing to meet it.
The DLC test is even vaguer as regards the systemic financial resilience objective. The DLC needs only to advance that objective. While not necessarily the intention, this risks a very unpredictable, wide-ranging and open-ended power that could have a serious impact on club finances. It is also an issue that can be easily mitigated, while still allowing the IFR to meet its objectives. Again, I seek simplicity on behalf of the clubs. I am really concerned that here the detail is so great that it will swamp some clubs.
In the current drafting, potentially the only check on endless interventions, by way of DLCs relating to the systemic financial resilience objective, will be either the IFR’s discretion—in other words, the IFR deciding it has done enough for now—or the IFR being forced to have regard to avoiding adverse effects building up as a result of excessive intervention. Neither of those seems adequate to mitigate the significant risk to English football at all levels. I acknowledge that there is discretion for the IFR to not act in this way. However, I do not think there should be an option to do so, given the very significant risks to English football that would come with the powers being used in this way.
Lord Bassam of Brighton (Lab)
I listened carefully to the noble Lord and, bizarrely, in preparing for the Bill, I looked at the accounts of a number of the small league clubs the noble Lord seeks to protect with this. They all have to have properly audited accounts. The clubs I looked at—they are in the National League, the National League South and the National League North—have turnovers that vary between roughly £10 million a year and £400,000 to £500,000. They are properly set-up companies that have to file reports with Companies House, et cetera, and they all go through an audit process. It seems to me that, in any event, they will supply to their auditors many of the things the noble Lord seeks and asks for. If they did not, they would not be complying with a proper audit.
Lord Moynihan (Con)
The noble Lord, Lord Bassam, has made some important points and, of course, everything I have said is based on the fact that those clubs will be following that. They are basic conditions that any organisation, not least a football club, should follow. All my amendments—I have studied them carefully—seek to make it easier to ensure that the clubs follow those procedures and that the uncertainties and vagaries in the current drafting of the Bill are clarified, making it easier and more efficient for clubs to meet their obligations as companies and football clubs in the professional leagues.
Lord Pannick (CB)
The noble Lord, Lord Parkinson, posed a number of questions about the operation of Part 3 in relation to licensing functions. I will add one further question, to which I do not necessarily expect an answer today. Pursuant to UEFA regulations and delegation from the FA, the Premier League currently licenses clubs for the purposes of their participation in UEFA club competitions. I declare an interest as a season ticket holder at Arsenal Football Club—I realise that some of the other clubs supported by noble Lords would not have an interest in this matter for various reasons. My question is: will this function of the Premier League be affected by Clause 15 or any of the other clauses in Part 3?
Lord Wood of Anfield (Lab)
My Lords, I will speak to my Amendments 168 and 169, which connect with some of the themes raised by the noble Lords, Lord Pannick and Lord Moynihan. One of the most sensitive areas of this regime is the imposition of discretionary licence conditions on clubs. The purpose of my Amendment 169 is to say that the regulator can introduce such conditions only after being satisfied that the conditions would
“not be met by the club complying with all rules, requirements and restrictions which … will be imposed by a competition organiser”.
Essentially, this does not go as far as full delegation to leagues such as the Premier League—I agree with the noble Lord, Lord Pannick, on the broad criticism of that—but would introduce in one specific area what might be thought of as a limited principle of subsidiarity for the imposition of discretionary licence conditions.
The main purpose is to ensure that the regulator observes the norm of good regulatory co-operation—with not just the Premier League but all the leagues—by looking first to the adequacy of league arrangements in response to specific problems that will be the most politically and competitively sensitive, before stepping in and intervening with club-specific conditions attached. Why? It is because subsidiarity is a good principle of regulation where it is not inconsistent with the application of the intent of the law; also, I believe that it will foster the habit of regulatory co-operation more generally—not just on discretionary licence conditions. It will avoid duplication and confusion in regimes, and it will equip the regulator with a bit more political protection when it comes to the charge of political interference, because it can say, “We’ve looked to the leagues to step in first before stepping in”.
In the case of the Premier League specifically—let us face it, that is where the rubber hits the road on this issue most of all—it gives it, first, a chance to maintain system-wide and league-wide governance integrity before club-specific rules arrive, rather than risking the intervention of the regulator, leading to fragmentation between clubs. Secondly, it allows differences in application, inside the Premier League, of the general IFR rules in ways that account for differences in risk, finance and strategy, which we have heard discussed many times in Committee.
An example is capital buffers. The regulator will want to require cash reserves, and in the case of the Premier League, you want to take account of those areas where there are genuine differences from lower league clubs—differences in player registration rights, meaning players are more liquid assets, for example. The Premier League could design league-wide rules that are sensitive to these different conditions. The amendment does not say that Premier League rules would trump regulator rules, but where there are concerns, the regulator would look first to the Premier League to modify league-wide rules that respond to the concerns before the regulator directly intervenes.
Another scenario might be an issue of liquidity management inside a Premier League club. This amendment would point to the regulator first looking to the Premier League to take steps such as enhancing its monitoring systems, developing new metrics, et cetera, before it goes to individual licence conditions. This, again, would ensure that the league could retain the integrity of league-wide rules, rather than Premier League clubs having individual regimes as and when they trip up over certain rules.
What if the regulator wanted to intervene with a specific club as a matter of urgency? It could still do this. What if the regulator thought Premier League rules were inadequate to the task and insisted on imposing a licence condition that cut across and undermined league rules? Ultimately, it could still do that too; in fact, it may think that was the right thing to do. But what the amendment would do is introduce a prior stage that looks to the leagues to make league-wide governance adjustment first. In the name of good regulation, that seems to me a sensible, limited amendment.
Baroness Brady (Con)
My Lords, I rise to offer my support to the amendments tabled by the noble Lord, Lord Wood, and by my noble friend Lord Moynihan. These amendments take quite different approaches, but they seem to be driving at the same thing: a desire to clarify and improve the financial licensing section of the Bill. In my view, they highlight a really important principle—that the IFR should adopt an outcomes-focused, light-touch approach to developing its regulatory framework, and that it should work closely with football to do that.
These amendments would, in my view, be a vital step towards achieving a good balance in football regulation, one that safeguards financial sustainability by targeting clubs that have problems, which are clearly critical, while also respecting the unique responsibilities and expertise of the competition organisers. The current drafting of the Bill leaves critical questions unanswered about the regulators’ approach to financial regulation.
It is currently unclear whether the IFR will take a blanket, rule-driven approach that imposes granular financial requirements such as specific liquidity ratios or debt-to-equity thresholds across all clubs or, alternatively, whether it will adopt an entirely bespoke approach, applying discretionary licence conditions to every single club—all 116 of them—according to their unique circumstances and business models. If the IFR did the latter—it is entirely open to the IFR, because that is how ambiguous the Bill is—it would significantly undermine competition organisers’ ability to maintain a level playing field. Those licence conditions would necessarily need to be confidential to protect commercially sensitive information. For example, my club, West Ham United, would have no idea whether other comparable clubs were operating under similar conditions or not. That is a recipe for competitive chaos.
These amendments would mean that the IFR would need to take a far more balanced path to an outcomes-based approach, setting high-level principles and objectives while allowing leagues to implement their own rules to achieve those outcomes. Of course, they would be able, and must be able, to take a targeted approach to clubs getting into difficulties, stepping in at any time if those rules were deemed systemically not to be working, or if there was urgent concern about a single club or group of clubs. A more outcomes-based approach would ensure that the IFR focuses on the “what” rather than the “how”. By defining clear financial outcomes such as on balance sheet health, resilience, transitionary finance and asset protection, the IFR could establish a framework that addresses financial risks while avoiding unnecessary micro-management of clubs.
There is no reason why financial licensing should not follow this proportionate, targeted model, particularly as competition organisers such as the Premier League and the EFL already have sophisticated financial sustainability rules in place. If another competition organiser, perhaps one that has had less success in enforcing financial rules, wishes to give up this area completely to the IFR, that would be its right, but let us not forget that competition organisers have a deep understanding of their clubs’ financial dynamics. They already operate robust systems to monitor and enforce financial sustainability; for example, the Premier League has detailed profitability and sustainability rules, which are strictly adhered to, while the EFL has its own financial monitoring requirements tailored to the unique challenges faced by its clubs.
Lord Jackson of Peterborough (Con)
My Lords, it is a pleasure to comment on this part of the Bill. I rise to support the amendments in the name of my noble friend Lord Moynihan and the clause stand part notice of my noble friend Lord Parkinson of Whitley Bay, and to develop some of the points raised by my noble friend Lady Brady.
I begin with Amendment 128 in the names of the noble Lord, Lord Bassam, and the noble Baroness, Lady Taylor. I feel that there is no balance in it; that it creates an imbalance in terms of its impact on smaller clubs. While I have problems with the whole clause, I think this is the most difficult and onerous part, in its capacity for gold-plating and regulatory overreach. I also think it cuts across existing primary legislation, such as the Proceeds of Crime Act. What we are potentially seeing in these very loosely worded and wide-ranging powers—
Lord Bassam of Brighton (Lab)
Is the noble Lord really saying that it is onerous for the regulator to know from a club who the owner of that club is, what the source of the funds might be or that the owner has funds that enable them to properly operate a football club?
Lord Jackson of Peterborough (Con)
I think that is a fair question, but the amendment that the noble Lord is inviting the Committee to support today is what I might call a dangerous dogs amendment. It is basically reacting—legislation by anecdote or by the lowest common denominator. You find one bad apple in a barrel and you smash the barrel up and throw the apples everywhere. This will have a big impact on clubs.
I pray in aid the financial guidelines 17/6 that the Financial Conduct Authority put out in 2017 and the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017. The road to hell is paved with good intentions. That was about stopping people laundering money—fair enough. What it has actually resulted in is dozens of people in prominent positions, such as local councillors, Members of Parliament, judges, chief executives of local authorities—even Members of your Lordships’ House—not being able to open bank accounts, and their sisters, their wives, their husbands and their brothers not being able to open bank accounts, because of onerous, overzealous regulation.
I am not saying that the IFR would necessarily develop in that way, but some of the most innocuous wording in primary legislation can sometimes give rise to that kind of gold-plating. It began, of course, under the anti-money laundering and counterterrorism regulations that we all supported. My point is that the sins of some clubs should not be visited on all clubs. My noble friend Lady Brady is absolutely right that if we do not have an objectives-based strategy, if we do not have a focused strategy for dealing with the most egregious issues, we will have a universalist approach of assuming that all clubs will be owned by dodgy owners—drug traffickers, people smugglers; I exaggerate for effect. There is the perception that that is the case and, of course, it is not the case at all. I say to noble Lords: be careful what you wish for.
On Amendment 173 in the name of my noble friend Lord Markham, I have very serious issues with this clause, because it fails on its own merits, in many respects, because it is not commercially flexible. If we are going to give a power, under Clause 22(5), for the Secretary of State to vary the licence conditions—and I have big problems with “add”—which are already settled, we will want to do that quickly and in an efficacious manner. We will not be able to do that using the affirmative resolution in this House and the other place, because we cannot move quickly or make decisions quickly to respond to commercial change.
I am also very worried about the limited sanctions available in terms of mission creep. Clause 22(6) says:
“The Secretary of State may make regulations under subsection (5) only if requested in writing to do so by the IFR”.
Again, mission creep is almost built in there. Then, in Clause 22(7):
“A request under subsection (6) must explain why the IFR considers that the making of regulations under this section is compatible with the purpose of this Act”.
The question is: is a Secretary of State likely to refuse that? Probably not. There is not really a built-in self-policing mechanism in the Bill, and it is because of the wide-ranging powers and the permissive nature of this wording that I have problems.
The provision fails because it is too onerous and too draconian. However, it also fails on the other side, in that it cannot work quickly enough to address the specific club-based issues that the licencing condition variation is needed for. For those reasons, I ask the Minister to consider Amendment 128 carefully. This is a sledgehammer to crack a nut, and it invites the independent football regulator to exercise its powers ultra vires, which is not in the best interests particularly of smaller clubs.
Lord Markham (Con)
I rise to speak to my Amendment 173, but first I echo the words of many other noble Lords. I support the outcomes-based approach the noble Lord, Lord Wood, is trying to achieve with his amendment, and I think there is broad support for that.
To pick up on the debate between the noble Lords, Lord Maude and Lord Bassam, on strategic business plans, and to give a bit of detail by way of background, the information one needs to provide for an audit is necessarily backward-looking, looking at the last year for which accounts have been provided. A strategic business plan, by its very nature, is forward-looking. I would be very surprised if smaller clubs with, say, a turnover of £500,000, do that as a matter of course. Lots of small businesses and shops have that sort of turnover, and I am sure they are not doing it either. I am not saying it is not desirable, but it could quite quickly turn into a consultant’s paradise if every single club, including the small ones, suddenly had to produce three-year or five-year business plans. They would have to resort to consultants to do that, which would become burdensome.
This brings us to another problem that we have talked about a number of times. Noble Lords have heard me talk about liquidity issues. By trying to solve the sins of one or two clubs, we are in danger of putting a burden on all of them, particularly if we are asking clubs to deposit money as part of a liquidity ratio to ensure they have a safety net. That will inevitably take money out of football. I had a meeting with the Minister and her team last week, and I thank her for that. We had a very good conversation about exactly this point, and what she promised was a proportionate, sensible approach.
That brings me to my Amendment 173. We are having very sensible conversations, in general, based on the desire of all noble Lords to do what is best for football. However, the problem is that whatever happens here, the Secretary of State has the ability quite easily to change everything. So, in response to everything we discuss, such as ensuring that the licences required are proportionate, the Secretary of State can easily say, “Well actually, we want a more muscular approach”. All the debates over the last five days and counting, the meetings and the various consultations could quickly be set aside because a different approach is wanted. That is my concern.
It does not matter where we have got to in the conversations we have had over the past few days: they will suddenly count for nothing if the Secretary of State can completely change the rules, raise the bar and change the discretionary licensing conditions. I would like assurances from the Minister. How do we safeguard against the fact that these—in my opinion, very good—debates could suddenly be set aside because in a few years’ time, a Secretary of State wants to take a completely new approach, which could be entirely disproportionate?
This has been a rigorous and constructive “two plus two equals five” process, as I call it, as we try to agree on an approach to checks and balances. None of us will be totally happy with how it turns out, but we have all had constructive input into to it. However, all of that could be quickly set aside by a future Secretary of State being able to change the approach.
Lord Pannick (CB)
Under Clause 22(6), the Secretary of State may make the regulations the noble Lord is concerned about only if requested in writing to do so by the IFR, so the Secretary of State does not have complete discretion. We would be creating a new system which may reveal defects and omissions in its operation, so surely it is sensible to have a power to amend it if defects become manifest.
Lord Markham (Con)
I thank the noble Lord. Of course, we want to have the flexibility to react to such situations. This issue comes up in various other contexts, such as government statements. There are lots of points where the Secretary of State can vary the approach. The question is: how do we get the checks and balances right? However, I think there is basic agreement on this issue, and I would like to hear the Minister’s views.
Baroness Twycross (Lab)
I thank the noble Lords, Lord Markham, Lord Parkinson of Whitley Bay and Lord Moynihan, and my noble friends Lady Taylor of Bolton, Lord Wood of Anfield and Lord Mann for tabling the amendments in this group. I also thank all noble Lords for their contributions. I will take each of the amendments in turn before responding to the noble Lords, Lord Markham and Lord Parkinson, and their opposition to the entire licensing regime standing part of the Bill. I will endeavour to get the noble Lord, Lord Pannick, a response to his question in the near future; I do not have the detail he requested today.
Amendment 128, from my noble friend Lady Taylor of Bolton, and Amendment 129A from the noble Lord, Lord Moynihan, relate to owners. The first seeks to make identifying an owner’s source of funds a prerequisite for a provisional licence. I absolutely agree that it is crucial that the regulator has oversight of an owner’s funding, so it knows how a club expects to fund its activity and the source of this funding. I hope my noble friend will be reassured that this is why a club is already required to provide such detail as part of its application for a provisional operating licence.
When a club submits its application for a provisional operating licence, this must include a strategic business plan. Among other things, this must contain detail about the club’s operating costs, how these costs are to be funded and, crucially, the source of such funding. This will enable the regulator to scrutinise the source of the funds. On the point made by the noble Baroness, Lady Grey-Thompson, importantly, a club must set out how much it plans to spend and how it will fund that cost. Furthermore, if the regulator has concerns at any time—even before it has received its provisional operating licence—about the source of an owner’s wealth, it can test that owner. Should it find that an owner’s source of wealth is connected to illicit finance, that owner will be found unsuitable.
I also agree that it is important that the industry has certainty as to what the regulator will consider “significant influence” by owners. Of course, what is meant by “significant influence and control” would need to have been set out in guidance before clubs and the regulator can consider who meets this definition. That is why I can assure noble Lords that the Secretary of State’s guidance will be produced in good time, in order to give this clarity.
Noble Lords should note that the provisions in Clause 3 and Schedule 1 that define “owner” come into force on the day the Bill becomes an Act. That means that the obligation on the Secretary of State to produce this guidance comes into force on that day, whereas the licensing provisions and other provisions which rely on the definition of “owner” will be commenced later, by regulations.
I turn to Amendment 132, from my noble friend Lord Mann. Although the risk of clubs going into administration will be greatly reduced, it may still happen. The regulator revoking a licence would be the ultimate punishment and would be used only in the most extreme of circumstances. I assure my noble friend that the regime is designed to avoid the situation his amendment aims to provide for, and that ensuring that a club has a plan for adverse shocks is at the heart of the regulator’s financial regulation regime. This might include a plan to keep the club going if, for example, an owner can no longer continue to fund it. We have spoken to many football clubs while developing the Bill, and know that the well-run clubs already do this.
Turning to Amendments 167A and 168A to 168C, from the noble Lord, Lord Moynihan, I understand his intention that the regulator should identify a clear risk before acting. The amendments are not necessary to achieve the aim in relation to his points on discretionary licence conditions, as was explained to the Premier League when it suggested these exact amendments prior to introduction. The regulator can attach discretionary licence conditions only if the conditions contribute to a club meeting the threshold requirements, or if the conditions advance systemic financial resilience.
The regulator is bound by its general duties, meaning that it must have regard to its regulatory principles and must act reasonably and proportionately. In effect, that means that the regulator can attach a discretionary licence condition only to address a risk it has identified. I assure the noble Lord that the regulator cannot take any action that is meaningless or does not advance its objectives. If a club feels the regulator is doing that, it can appeal any action through the appeals regime.
Ultimately, these four amendments all seek to raise the threshold for intervention and limit when and how the regulator can act. For every discretionary condition, the regulator would have to demonstrate that there was no possible alternative to achieve the aim than to impose that specific condition. This would be an unacceptably high bar, fettering when the regulator can act. In practice, we think the risk of legal challenge could lead to an excessively risk-averse regulator, afraid to act swiftly or at all.
I thank my noble friend Lord Wood for Amendments 168 and 169 and for his genuinely constructive approach to scrutinising the Bill, which I very much appreciate. I note that the noble Baroness, Lady Brady, also expressed concern on the points he raised. My noble friend has met with officials and me regarding these amendments and I hope that those meetings were useful. We believe these amendments would severely limit the regulator’s flexibility to meet its objectives and ensure clubs reach their threshold requirements. The regulator should not take its lead from the competition organisers. Of most concern is the blurred accountability that this approach would introduce. The fan-led review laid bare the significant issues with self-regulation, and that is why we are introducing an independent regulator.
That said, the system is designed so that the regulator should not need to intervene if the required standards are being met. If clubs meet their threshold requirements naturally—for example, through their compliance with the industry’s own existing rules—the regulator should not need to apply discretionary licence conditions. The model in this legislation is the right one, with clear accountability, and where discretionary licence conditions are not applied in a one-size-fits-all way but reflect each club’s specific circumstances.
My noble friend Lord Bassam raised the basic requirement for clubs to have a sustainable business plan. I agree with him that that is important. That basic requirement, as well as the requirement for clubs to engage with their fans and ensure that their owners and officers are suitable custodians, are light-touch, appropriate measures that should already have been in place.
On Amendment 169A, from the noble Lord, Lord Moynihan, the regulator is already required to publish guidance about how it will use discretionary licence conditions, including the outcomes it seeks to achieve. That will give upfront clarity to clubs and competition organisers. However, the Government do not believe that the level of detail in the noble Lord’s amendment is appropriate for the Bill. He and I would agree that we are not in-depth experts on football finances—had I looked ahead in my speech, I perhaps would not have said that, and I apologise. I am not an in-depth expert on football finances, the inner workings of football clubs or how football clubs operate; I will allow the noble Lord to make his own conclusions on the extent to which he is. The regulator will employ experts in this sector who will have far more knowledge of these areas than we do. They will also have a stronger evidence base on which to base their actions, informed by things such as the “state of the game” study and consultation with the industry itself. That is why we have required the regulator to publish guidance on discretionary licence conditions and why we think it should be left to do this independently. We do not want to unintentionally hamstring the regulator with overly prescriptive requirements for the guidance it must produce.
In response to the point made by the noble Lord, Lord Moynihan, if the regulator agrees with him that it should include detail on financial shocks, liquidity and debt management, it will include this.
I turn next to Amendment 173, from the noble Lord, Lord Markham. The Bill outlines the specific types of discretionary licence conditions that the regulator may attach to a club’s licence to address its financial or non-financial resources or to improve systemic financial resilience. It is possible that, as the industry evolves, these types of conditions might not remain adequate to address the new or different financial risks faced by clubs, and there might be more effective ways to address them. That is why it is crucial that there is a mechanism in the Bill to enable the types of conditions available to the regulator to be updated. This amendment would deny the regulator this flexibility and potentially make the regime unable to adapt to changing economic circumstances. It is vital that the regulator has appropriate the tools to regulate football effectively, both now and in the future.
I reassure the noble Lord, Lord Markham, that the Bill does not give the regulator or the Secretary of State free rein to make changes. The Secretary of State can amend the types of discretionary licence conditions that can be attached only if requested in writing to do so by the regulator—a point highlighted by the noble Lord, Lord Pannick. The regulator would have to provide clear reasons and consult stakeholders ahead of making a request.
Lord Jackson of Peterborough (Con)
On that specific point, in Clause 22(8), the language is quite permissive and wide-ranging regarding who the IFR considers it appropriate to consult in respect of wide-ranging powers, particularly those to add or remove an item from primary legislation. Can the Minister confirm that the guidance that the Government will publish will tidy that up and make it tighter on who the IFR has to consult before it would write to the Minister seeking to vary the licence conditions?
Baroness Twycross (Lab)
We discussed in one of the previous groups why the legislation does not currently have specific people that have to be consulted every time. I commit to write to the noble Lord to clarify the specific point he raises. The regulator would have to provide clear reasons and consult stakeholders ahead of making such a request. The Bill has not stated every single person the regulator would have to consult every single time, but there are principles at play around how the consultation would need to take place.
Lord Jackson of Peterborough (Con)
I thank the Minister but she will agree that the guidance could, for instance, include groupings of particular types of people who would be key stakeholders and would need to be consulted, because this would obviously be quite a wide-ranging intervention by the IFR.
Baroness Twycross (Lab)
I will write to the noble Lord on that point. I hope it will give noble Lords some reassurance that Parliament would also be able to scrutinise any change, as regulations would need to be made by the affirmative procedure.
We do not believe that Amendments 174A and 174B, in the name of the noble Lord, Lord Moynihan, would be helpful to the regulator, as we explained to the Premier League prior to introduction. The addition of a minimum six-week period would mean a total minimum of eight weeks once you include the minimum period for making representations or giving a commitment in lieu. That would mean an eight-week delay, during which the regulator would not be able to impose a financial condition, which might mean that the regulator would have no choice but to sit idly by while the issue identified at the club gets worse. That would be contrary to the regulator’s objectives and principles and is therefore not considered acceptable by the Government. Slow action has been a common feature of industry self-regulation. We will not allow it to become a feature of the independent regulator’s regime.
The regulator already has a regulatory principle to proactively and constructively engage with the regulated industry, including competition organisers. This means that regulatory intervention at one of their clubs should never come as a shock to a competition organiser. Once the regulator has given notice of its intention to attach a financial discretionary licence condition, the competition organiser will have a minimum of 14 days to propose a commitment in lieu. To be clear, this is a minimum; the regulator may well decide to specify a longer period, but, equally, if the situation was sufficiently serious and urgent, the regulator should not be prevented from acting without delay. The minimum period of 14 days therefore strikes the right balance.
Amendment 174B only adds further burden and confusion to the process of applying financial discretionary licence conditions. The regulator is required to follow the procedure set out in Clause 23, except in very limited circumstances. This includes urgent circumstances where the regulator considers that the issues are so significant and urgent that the condition needs to be imposed immediately. Under those circumstances, burdening the regulator with a requirement to go through the process of commitments in lieu when it has already acted under urgency and has its own regulation in place is not acceptable. This would also leave clubs in an ongoing state of uncertainty, where an existing financial licence condition might be replaced with a different competition organiser requirement. This would be unnecessarily complicated, confusing and burdensome.
Lord Parkinson of Whitley Bay (Con)
My Lords, this has been a fruitful and helpful debate on what will be one of the key issues with which we will all have to grapple once the regulator is established. I thank the Minister for engaging with the questions I raised in the spirit of the probing nature of my amendments that began this group.
The answer that the Minister gave was that the agility and speed in the system comes from the ability to seek an injunction in the courts, at least in the first instance, then from the secondary powers and the designation that the Secretary of State allows. That might be more welcome to the ears of the noble Lord, Lord Pannick, and the rest of his profession than it might be to football clubs, but it is a helpful clarification, and I am grateful to the Minister for giving it.
This underlines the importance of getting the regulatory regime right and making sure that the regulator does its work in a way that commands the confidence of football clubs, so that they do not seek to get around the law or wish that there were ways for them to do so. With gratitude to the Minister and to the noble Lords for speaking to their amendments in this group, I will not oppose the clause standing part.
Lord Markham
Member's explanatory statement
This amendment requires the Regulator to set out its rules regarding licences no later than one month after passage of the Act.
Lord Markham (Con)
I shall speak to Amendments 125, 133 and 135. Hopefully, this will be a fairly uncontroversial, simple set of amendments, which try and set out clear expectations on timing.
I am very aware that, while there is uncertainty as to what the discretionary licensing regime may be, that has an unsettling effect on both clubs and potential investors into the sector. We would all agree that this is not something that we want. We want everyone to know what the rules of the game are, so they can either get on with doing whatever they need to do to apply to those licensing conditions and/or, if they are looking to invest in the game, so they can have that degree of certainty as to what the rules of the game are going to be, so as not to have that potential chilling effect on any new investment.
Amendment 125 tries to give the regulator a time limit of one month from the passage of the Act. I am very aware that there is a shadow regulator in place at the moment, so I hope that this is something that the shadow regulator is working on in the meantime. That is why I think that a one-month deadline is quite doable in that sense.
Related to that is Amendment 135, which says that once a club has put a discretionary licence application in, it will receive a reply from the regulator within one month. Again, I am very much assuming that these things are not a binary process. I would expect the club to be in liaison with the regulator as it put this application in and be receiving advice as it did so—so a one-month timeline at the end of that is quite relevant.
It is for us to set some expectations on the regulator in the Bill. In Clause 17(9), the regulator gets to set its own timing for it all, so it is quite appropriate that we are saying that, given the uncertainties placed on clubs, we expect these sorts of reasonable timeframes. Again, I am quite happy that we decide what those appropriate timeframes might be through our discussions on this, and there may be arguments to vary that slightly—but one way or the other, it is quite important that we set out what those timings and expectations should be.
Finally, Amendment 133 tries to give more time for how long provisional licences last. We want to try and avoid a cliff-edge situation whereby clubs are suddenly in the provisional licensing regime and then do not get beyond that. We would all then have a set of circumstances which I do not think any of us have really planned for, in terms of what would happen and whether the club would have to stop taking part in the competition at that point. Amendment 133 tries to give a bit more time around the provisional licence, increasing it from three years to four.
The main reason for these amendments is to make sure that these things are considered and that there is a good debate on what the appropriate timeframes are. It is reasonable that we put down what those timeframes should be, so clubs get as much certainty as possible in this. I beg to move.
Lord Pannick (CB)
My Lords, I am very sympathetic to the purpose of the noble Lord, Lord Markham, in relation to his Amendments 125 and 135. Perhaps I may respectfully suggest to him and to the Minister what may be more palatable than what his amendments suggest. Amendment 125 is rightly concerned that the rules for a provisional operating licence should be made speedily. Everybody must know what the rules are. The amendment would require that these rules be made no later than the period of one month beginning with the day that this Act is passed. If the noble Lord is going to bring the amendment back on Report, I respectfully suggest that it would be more acceptable to say within one month from the date when the Act is brought into effect. The noble Lord will know that under Clause 99(1) and (2), Part 3—with which we are concerned—comes into effect not when the Act is passed but at a later date when regulations are made.
In relation to Amendment 135, the noble Lord is rightly concerned that the IFR should make the decision whether to grant a regulated club a provisional operating licence speedily. He lays down a period of one month from when the application is made. The amendment would allow for an extension of only two weeks. It is an absolute rule, subject to a two-week extension period. I respectfully suggest that that is far too confined. It is normal in a provision of this sort to allow for the period to be extended if there are exceptional circumstances. It is not difficult to envisage cases where, rightly, the IFR cannot take the decision within a period of one month plus two weeks.
For example, the IFR might reasonably take the view that it needs answers from the club to questions of detail, which it puts to the club, and the club may not provide those answers, or be able to provide them, within the period of six weeks for which the noble Lord’s amendment allows. I understand and I share the concerns at the root of Amendment 135, but it really needs to have an exceptional circumstances provision.
Lord Addington (LD)
My Lords, looking at these amendments, I think that a little bit of agreement is breaking out that certainty and getting things done quickly are required in the Bill. The noble Lord, Lord Pannick, may have made drafting suggestions on the hoof, and we are lucky to have him to fulfil that function for us, but something that clarifies and addresses the issues raised here would probably be helpful. If there is something that we have all missed and it is hiding somewhere, that is great, but we need those answers.
Lord Parkinson of Whitley Bay (Con)
My Lords, I have added my name to the amendments in this group, and I certainly agree with what the noble Lord, Lord Pannick, has suggested in relation to Amendment 125. We are grateful to him. The noble Lord, Lord Addington, is right that we are seeking to make sure that we get the right balance with this group of amendments. We are keen to close the unfortunate gap that the Bill currently poses, which is that, if it passes without amendment, nobody will know what rules the regulator might yet specify or the period in which it might specify them. We need a bit more clarity for those preparing to be regulated and wanting to do so in this way would be useful. With gratitude to the noble Lords who have done the work of the Committee and suggested ways in which to improve on this ahead of Report, I look forward to hearing what the Minister thinks.
Baroness Twycross (Lab)
My Lords, I thank the noble Lord, Lord Markham, for tabling these amendments, and the noble Lords, Lord Pannick, Lord Addington and Lord Parkinson of Whitley Bay, for what has been a short but constructive debate. If the noble Lord, Lord Pannick, was, as was suggested by the noble Lord, Lord Addington, making changes on the hoof, I hope that he will accept that I am not going come up with a response on the hoof, but I will endeavour to look into the points that he raised and will get back to the whole Committee subsequently.
Starting with Amendment 125, I understand the desire for quick implementation, and the desire to make sure that clubs are given clarity on what is required of them as soon as possible. However, we believe that the regulator should not have an arbitrary deadline imposed on it to make rules relating to the application of provisional operating licences. The regulator should be able to conduct an effective consultation with clubs regarding the rules around this clause, and that should not be rushed. The regulator is already encouraged to be expedient, including in its regulatory principles, though I note that in a previous debate the noble Lord, Lord Parkinson of Whitley Bay, raised some concerns around the definition of “expedient”, which we are still looking into. Beyond this principle of being time-efficient, the regulator should not be subject to arbitrary, tight deadlines that would serve only to limit its operational flexibility.
Lord Markham (Con)
My Lords, I thank noble Lords for their contribution, including the noble Lord, Lord Pannick, for his helpful suggestions. Having some certainty on the timeframe is quite valuable; the major concern is that while uncertainty is out there, you will get clubs and potential investors holding back on investment. Addressing that is the main intention behind these amendments. I hope that, as we progress further, we can look at some of those helpful suggestions so we can get the balance right. I beg leave to withdraw the amendment.
Lord Mann
“(e) setting out all financial arrangements with external agents or other intermediaries involved in contacts or recruitment, or both.”
Lord Mann (Lab)
My Lords, I again refer noble Lords to my interests in the register relating to this debate. I was in a meeting with the chair of the supervisory board of one of the more successful German football clubs discussing regulation. I asked him if there was one thing that could be done to improve football from regulation inside England what it would be. His advice was that the best thing that could be done—which is not actually available to us in this House as an amendment—would be to tax football agents in the UK through the British tax system.
Why might the head of a major football club—a competitor—wish to see that happen? If that happened—or if anything else threw into question the transparency of football finances, particularly in relation to the acquisition and departure of the key asset players—behaviour would be modified. I recall discussions with people who gave graphic detail of how, in the olden days—but not old enough for me not to have seen it happen—there was the notion of “cash in the boot”. A player would be signed to a team, suddenly and unexpectedly, and would play a few games. In doing so, cash would be handed over. I do not think that; I know that. I will not cite examples even though I could—it would not be fair to do so—but that was not uncommon.
In the modern game—today’s game—the amounts of money are much greater. One has seen situations where football clubs get into financial problems, usually because of relegation from the Premier League, and do not seem to know who owns their assets. There is a myriad of situations. That includes contract details—I can think of some in the recent past, where the fans, sponsors and others were rather bemused to find that certain players were able to go, at no fee, to play for other teams because of a clause in the contract that most people were unaware of.
My Amendments 129 and 248 seek to deal with the specific problem of how agents behave. There are examples I could cite where, pre transfer, players have been sold or bought for significant amounts of money and, literally at the very last moment, they suddenly change agents. I will give a hypothetical example, rather than shine too much specific light. Let us say that a player is sold for many tens of millions, and they have a single agent. The day before their transfer documents are signed, they then change agency. The agent then sues the player for their loss—for the cut that they would have got—even though the agents’ fees are very significantly higher than the worth of the individual agent. Why would anyone choose to do that? If you are a purchasing club and you are competing with others for a prized asset, you might well be prepared to pay more money and whatever requirements there are. But why would a selling club do that? What would the advantage be? The answer is there is zero advantage to a selling club—none—or, potentially, a disadvantage. If there are £15 million or £20 million in agents’ fees, that amount of money might come in to your club. So what is the motivation?
One of the things that has bedevilled football across the world, not just English football, has been people taking a percentage. I have spoken to people who have been offered money to give statistics on 12 and 13 year-olds in their own club—a cash-based suggestion that would accumulate over time, should the player get to a level of being worth lots of money. That is the minutia, but the major cases will involve major financial transactions. Fans are often perplexed by certain purchases and the amounts of money spent on players. They say, “What is going on here? This player does not appear to be worth quite that amount of money, or indeed anything near it. It must be because of bad football decisions”.
I put it to the Committee that perhaps the transactions are determined not always by football decisions but by loans. Most fans can cite times they have been bemused when their club has loaned a player in and paid a very large amount of money to do so, even though no one has ever heard of them before. The player then disappears a year on, and no one ever hears of them again. Why would you pay £1 million or £2 million to loan a player who no one has heard of, who has no track record and who then has no future track record?
The taxman has an interest, which is why, if I were able to do so and it would have been within the rules of this Committee, I would have proposed that taxing agents via the UK tax system would be the best answer. While that does not give public transparency, it seems that it would mediate behaviour. However, these two amendments seek to allow the regulator—not the general public—to be able to see and assess what is being paid and what is in the contracts. That would not be in a public way, but in a private way—and that would modify such behaviour.
If we are interested in competition in the sport, taking out externalities that have nothing to do with the business of the sport is in the interests—including the business interests—of the industry and the sport. Shining a light so that people do not feel it would be appropriate to do their decision-making based on how much they receive as a reward for their wisdom in, say, selling a player would be to the health of the game. Anyone in the Committee who thinks that does not happen, and has not happened, is being extremely naive. Anyone who thinks that this happens only at the lower end—the non-league, with a bit of cash in a back pocket—is also being naive.
Because of the way the football business has worked, there is a lot of money to be made, and people have managed to find ways—legally—of making additional profits for themselves, particularly out of the movement of the key asset players. These two amendments seek to allow at least the regulator to see exactly what is going on. Indeed, this is important in the critical situation where, say, a club does not own the assets that everyone thinks it has, because it has managed to sell them off in advance to some third party and therefore cannot cash in on them. There are examples that I am very familiar with, where clubs have gone insolvent because of that. In some way, this power needs to be in the Bill, unless the Government could be persuaded that HMRC would be a better decision-making body and have all football agents’ transactions in this country taxed through the UK tax system. I beg to move.
Lord Goddard of Stockport (LD)
My Lords, I was getting overexcited listening to the noble Lord, Lord Mann, because we have lives outside this Chamber, and for my sins, I go in the Dog and Duck every now and again, where, somehow, people find out that I am involved with this Bill. My pint goes flat before I have had a chance to drink it, because they ask, “Well, why do you not get this sorted?”
One of the main questions that comes across is: “What are you going to do about the agents?” I did not think that that was really grating with supporters, but it is—from the top right to the bottom. I know because I support Manchester City, which used to be at the top, and I look after, where I can, Stockport County, who are reasonably not near the bottom any more.
Supporters are human beings. They work hard and pay their money to go to watch the football. Nothing grates more than when they find out how much agents get for doing these deals. As has been said, there is confusion about player ownership. Do two or three people own a player? Does a company own a third of that player? If we wish to sell that player, does that mean we need the permission of those other people before we can sell him? Is that value for the club? Those issues need teasing out.
I am attracted to the idea of an agent having to pay UK tax, which would really add some clarity to the Bill. To be honest, supporters do not quite get it. I am not saying that I am above them or anything like that, but they see it as nebulous. They want to know what practical things the regulator can do for them as football supporters. If the Government were fleet of foot, they would put agents’ fees at the front of the Bill and say that any agent of a UK footballer should pay tax in the UK. That would be universally supported by all supporters.
Baroness Taylor of Bolton (Lab)
My Lords, I agree that many of us who are concerned about football could talk all night about football agents and the concerns that many people have about them.
I want to talk about another amendment in this group. The Marshalled List says that this grouping is miscellaneous. The combination of topics that we are discussing in this section is rather strange. I want to say a word about Amendment 150 in my name, which concerns the concept and practicality of assets of community value. We would like to make this a condition of the licensing system. It is really important that fans have the reassurance that their ground is not going to be sold underneath them and all the assets of the club traded by someone who does not have the footballing interests of the club at heart. I am always surprised that more clubs’ grounds and assets of this kind are not deemed to be assets of community value. That would be part of the protection of clubs’ heritage but also—perhaps as importantly—significant in protecting clubs from rogue owners.
I have a particular interest in this because of what happened to Bolton Wanderers a few years ago. Thankfully, because of the actions of the fans and the supporters’ trust, the stadium, the pitch, the circulation area, the seats, the stands, the Premier Suite, our car park and the fan zone were protected when the local authority accepted that they should be assets of community value. It meant that those assets were protected. It was particularly important at the time because we had gone through the experience of having an owner whose main concern was not the footballing future of Bolton Wanderers but the assets. A rogue owner of that kind can do immense damage, so this protection is extremely important. I urge that consideration be given to making it a condition of the licensing that football assets are designated as assets of community value.
Lord Bassam of Brighton (Lab)
My Lords, I will speak to two groups of amendments within this group. Amendment 167 in my name and that of my noble friend Lady Taylor is about the removal of rogue owners. In a sense, this amendment poses the question: what is the point of a regulator that identifies bad practice and rogue owners but does not have clear powers and mechanisms to replace them? Our amendment seeks to incorporate within articles of association provisions that would oblige owners to give up their shares and make sure that those shares were given over to a new beneficial owner, subject, of course, to the usual checks.
Our argument is that the Bill must adequately address enforcement of the fit and proper owner test to enable the regulator to force an owner to sell their shares or force a director to resign from the board. In doing that, the regulator would be able to ensure that clubs have sufficient reserves to meet ongoing operational costs if an owner is disqualified.
At some point, it might be advantageous to consider having a central sinking fund in place to help cover interim costs. In the licence criteria, the regulator might also want to insist that clubs include in their articles of association a mechanism for the resignation of a director in those circumstances. That is important because we do not want situations such as Aston Villa found in 2016. In the mid-1990s Brighton & Hove Albion had owners not only who were deeply unpopular but who were not there because they had the best interests of that club at heart. More accurately, they were asset-strippers who eventually, without providing an alternative, sold the ground to a series of companies that set up a retail park. One of the saddest moments of my life was going to the last game there. We all knew what was going to happen to that site. It was going to end up as a Toys “R” Us. I have nothing against Toys “R” Us, but there were plenty of other sites in Brighton where it could have happily located.
I turn to Amendments 205, 208, 210 and 259, which are about protecting domestic competitions. Currently, the Bill does not require clubs to prioritise domestic over European or worldwide competitions. We feel that clubs should be property consulted before changes are made to competitions. The Bill should ensure that the regulator can designate European or worldwide competitions as restricted and not to be prioritised above domestic competitions. This would prevent clubs establishing a new entity to inherit the existing club’s identity and players—for example, the Man Cities of this world leaving the Premier League and calling themselves City Blues for the purposes of entering a restricted competition.
This is important because the ecosystem of competitions has been under pressure in the last few years. For instance, earlier this year moves were made to prevent replays in FA Cup matches. I think it would be fair to summarise that that was against the will of most clubs and largely for the convenience of the bigger clubs playing in European competitions. There is nothing wrong with them playing in Europe; it is very welcome and important for the success of our Premier League. We want to make sure that this carries on being the case, but the abolition of FA Cup replays went against the vast majority of clubs’ interests and has undermined the beauty of the competition in the sense that, periodically, replays provided much-needed funds for clubs in the lower leagues. It has also restricted the opportunity for lower-league supporters to see the bigger clubs when they enter the competition. It is important that the regulator has an interest in this and that we provide clubs with the certainty and security that they will be consulted about competition changes.
Lord Evans of Rainow (Con)
My Lords, I will speak briefly on Amendment 129 in the name of the noble Lord, Lord Mann. It is relevant to Amendment 93 which, your Lordships may recall, requires the new regulator to regulate football agents. My motivation for that amendment was to try to keep transfer fees within football. As I mentioned, it is very important that the grass-roots clubs that develop the players of the future get their fair share.
The amendment tabled by the noble Lord, Lord Mann, setting out all financial arrangements with external agents and other intermediaries involved in contracts, recruitment or both is an interesting one. My only question is: how will this work in practice? How will the regulator deal with highly confidential multi-million-pound transfers? The noble Lord mentions it being private and confidential and therefore not public, but potential leaks could affect these deals. What would the regulator do? How would he operate? How would he stop or block those transfers? The Premier League still has the best players. We still want to attract the best players. It is vital that we get this right to avoid the trap of unintended consequences. It is so important to protect the international reputation of the Premier League.
My amendment was tabled to ensure that no matter where the transfer comes from, that money stays within football. However, we would have to be careful about how that happened in practice.
Baroness Grey-Thompson (CB)
My Lords, regarding Amendments 150, 152 and 164, I will not repeat what has already been said about community assets. I will speak just to my Amendment 248A, which probably counts as a miscellaneous amendment. It is a probing amendment, strong concerns having been raised by the Supporters Trust at Reading. It seeks to insert a new clause, after Clause 51, on ticket pricing, meaning that regulated clubs would have to adhere to the following rules: dynamic pricing strategies being prohibited, concessionary tickets being mandatory and ticket prices for away fans being kept at the level set out in regulations by the Secretary of State. It is a simple amendment, but I suspect that it will not be universally supported.
I understand why clubs want to use dynamic pricing and how it can be used very successfully, but this amendment seeks a more fan-inclusive approach. The Supporters Trust at Reading quoted the Early Day Motion tabled in September 2024, when 19 of the 20 2024-25 Premier League clubs increased their ticket pricing. Abolishing or reducing concessionary tickets would be very bad news for older or younger fans who felt the effects of the cost of living crisis harder than most. Also, Fair Game has said that the constant rise in ticket prices has priced long-standing fans out of the game and that there should be proper consultation with supporters to address their concerns.
I do not seek to open the debate on what a fan is, but this amendment is about giving consideration to how fans can be engaged in discussions about ticket pricing. I am expecting many noble Lords to tell me that this is too interventionist and that it will limit clubs too much, but I am interested to hear the Minister’s response.
Lord Addington (LD)
My Lords, going through this long list of amendments, I think that we can all agree that “miscellaneous” is a good description of this group. On what is a competition, I added my name to one of the amendments, but probably should have added my name to the one about heritage. Is it a ground part of the heritage, is it part of the structure, is it what is going on? I should have put my name to this and look forward to the Minister’s reply. If we do not include this, we are missing an important part of why this Bill is justifiable.
Lord Moynihan (Con)
My Lords, I support the probing amendment tabled by the noble Baroness, Lady Grey-Thompson, although not necessarily the wording of it or the outcome. It is related to something that the noble Baroness and I have worked on for a long time and which is covered in my miscellaneous Amendment 258A. It binds the noble Lord, Lord Bassam, and me to the same cause. There is still a major problem of abuse in the ticket market for football, not least for membership cards. Last season alone, in February one club had to cancel more than 30,000 membership cards. They were all in the hands of the touts. This is a massive problem now.
When we started to campaign to sort out the secondary ticket market, it was much smaller. Fifteen years ago there were some 120 professional touts. Now there are subscription groups which get together using bots to get hold of tickets, place those tickets on the secondary market and sell them illegally. Viagogo is, regrettably, used as a speculator—a ticketing lobby. From that, those tickets are sold abroad illegally with, quite often, information hidden behind the icons. This goes against the terms and conditions set by the clubs, which do a huge amount of work across football to make sure, especially at sold-out matches, that tickets do not get into the wrong hands.
Lord Markham (Con)
In speaking to my Amendment 332, I will follow the words of some other noble Lords and say that I find it quite confusing that we have so many disparate amendments grouped together.
My Amendment 332 would stop the Secretary of State being able to define a season. I hope that someone—maybe the Minister or the noble Lord, Lord Pannick—will tell me that I have read this wrong somehow, or that it is not the intention at all, but I think we would all agree that, when it comes to regulatory or government overreach, trying to define a season and when it should start and end is not the role of government or a regulator. I hope that this is quite an easy one to clear up, because I would be very surprised if that is the intention behind it. The relevant Clause 92(3)(a) says that:
“The Secretary of State may by regulations amend this section so as to change … the definition of ‘football season’”.
It would be very welcome if that could be clarified; otherwise, I suggest that we might want to delete it.
Lord Pannick (CB)
My Lords, I will comment very briefly on the subject of football agents, which was raised by the noble Lord, Lord Mann, and supported by the noble Lord, Lord Goddard. I declare an interest: my son Joel Pannick is a football agent—I am very proud of my son—who works at Base. My perspective of football agents is that there are still abuses; they need to be regulated and they are regulated. The era of unregulated bungs no longer exists to the extent so vividly described by the noble Lord, Lord Mann.
Let me say why I want, in the interests of balance, to inform this Committee of what the position is. Football agents are now licensed and they have to pass a demanding examination. They are regulated by FIFA and the FA. I should mention that the scope of the regulations was the subject of legal challenges in the last year, and those legal challenges partially were successful. It is the case that HMRC adopts a far more vigorous approach to this topic than it used to, and rightly so; it keeps a close eye on payments and receipts. The noble Lord, Lord Mann, is absolutely right that there are many agents who are not subject to HMRC because they are based abroad, but those based in this country certainly pay tax, and in many cases a great deal of tax. I thought I would just mention those factors in the interests of balance.
Lord Parkinson of Whitley Bay (Con)
My Lords, like the noble Baroness, Lady Taylor of Bolton, I always balk when I see a group described as miscellaneous, or even worse in this case, “misc”. On the failure to give new names to the groups that have been degrouped, it is always helpful to have a go at giving us a theme. But I am grateful to the noble Lords who have covered a wide range of very important issues in this group.
I wanted to say a few words about my noble friend Lord Markham’s Amendment 332, to which I have added my name. A number of noble Lords raised in previous debates the concerning example of the delegated power for the Secretary of State to decide what and when a season is. I am glad we have had opportunity to discuss that on its own. This delegated power seems to be egregious. I am not quite clear why the Secretary of State should have a say on what constitutes a football season. I am not even sure why this delegated power is necessary—apart from granting the Secretary of State more powers over the game, there does not seem to be any particular advantage to her in granting herself this rather curious power. I would be interested to hear the Minister’s response. I wonder whether UEFA has a view on this measure. Would it not regard the Secretary of State being able to intervene in the definition of a season as political interference? If the Government have had discussions with UEFA on this point, I would be grateful to know.
I do not think the noble Lord, Lord Mann, actually got round to speaking to his Amendment 153 in this group, which relates to modern slavery—such are the pitfalls of a miscellany—but I wanted to highlight that one and congratulate him on bringing it forward. I am sure all noble Lords would agree that everyone has a duty to prevent this abhorrent crime. I was very proud to work at the Home Office when my noble friend Lady May of Maidenhead brought through the Modern Slavery Act 2015, which has made large headway into cracking down on this abhorrent behaviour. Since then, both the Premier League and the English Football League have released an annual anti-slavery and human trafficking statement, as have all the participating clubs. As the Minister knows, I am wary of increasing the scope of the regulator, but I would be interested in hearing how she thinks this new regulatory regime will operate within the law that we already have to tackle modern slavery and what she thinks of the amendment from the noble Lord, Lord Mann.
I am grateful to the noble Lord, Lord Pannick, for his comments on football agents. Whether they are more or less popular than lawyers, I will leave to others to decide—and indeed whether the existing regulation that is brought about by UEFA and others he mentions is, in this case, sufficient and not a requirement for further regulation, as we see in some of the other behaviours in football. I leave all these, and the miscellaneous other issues that noble Lords have raised, to the Minister to respond to.
Baroness Twycross (Lab)
I thank noble Lords across the Committee for the thorough debate on this group. If the group is called misc or miscellaneous, that does not diminish the significance of the concerns raised.
I will take each amendment in turn. First, I thank my noble friend Lord Mann for his Amendment 129. While it is right that the regulator should have all relevant details of the club’s finances when assessing it for an operating licence, we do not believe this detail is required to be provided in the Bill. The personnel statement should detail any key individuals working specifically at the club in question and should not include external individuals. However, any relevant financial arrangements can be included within the strategic business plan, or the financial plan, if the regulator deems this necessary.
My noble friend Lord Mann and the noble Lords, Lord Goddard of Stockport and Lord Evans of Rainow, raised concerns about agents and their fees. A different perspective—it is always helpful to get a rounded perspective—was raised by the noble Lord, Lord Pannick. In response to the broader point regarding agents, as was noted, FIFA has recognised the need for the better international regulation of agents and has proposed reforms. FIFA’s member associations, such as the FA, will retain the ability to introduce stricter requirements on agents than those stipulated in FIFA’s regulations. The DCMS will work closely with the FA to ensure that any national regulations for agents are fit for purpose. The Government are working with the FA and FIFA to track the implementation of these regulatory reforms, which are due to begin next year.
Amendments 150 and 164, in the names of my noble friends Lady Taylor of Bolton and Lord Bassam of Brighton respectively, concern assets of community value. Home grounds are often the most important assets that a club owns. That is why the Bill has prioritised key protections to prevent them being sold, used as collateral or relocated without the necessary considerations. “Asset of community value” status is another mechanism that a number of clubs and supporters’ groups have obtained for their home grounds.
Lord Bassam of Brighton (Lab)
My Lords, if I may ask the Minister to give way very briefly, I raised the issue of the abolition of FA Cup replays in the context of consultation. Had that been in the future, would there have been an obligation on the FA to consult which the regulator could have enforced? The shape of that competition is very germane and important to football fans across England and Wales, and it seems to me that it is a significant issue that ought at least to be part of the regulator’s consideration.
Baroness Twycross (Lab)
My noble friend raises an interesting point. The issue of the FA Cup replays would rightly be outside the scope of this regulator. The sporting calendar and the rules of specific competitions are matters for the football authorities to manage in consultation with the appropriate stakeholders. I am not sure whether that reassures my noble friend, but we can maybe have a longer discussion about it at another point.
On Amendment 242A from the noble Lord, Lord Moynihan—apologies if I am going over paragraphs that I have already covered—the intention behind this amendment is to make sure that clubs are not overburdened with requirements to notify the regulator of every event that ever happens. We do not want this either, nor is it in the regulator’s interest to receive a flood of unnecessary information. As the clause sets out, the notification requirement relates to material changes in circumstances. It will be up to the regulator to set out what it considers to be material in guidance, which we expect it will produce on this. The regulator will already have burdens in mind when setting its guidance and enforcing this duty on clubs, given public law principles and its regulatory principles. We want the regulator to receive the information and updates it needs to regulate effectively. By raising the bar for when clubs are required to notify the regulator of changes, the proposed amendment risks doing just that.
Amendment 248, from my noble friend Lord Mann, would introduce a new requirement for regulated clubs to register with the regulator all player contracts, transfer fees and other fees annually for the previous 12 months. I reassure my noble friend that, where this information is relevant for the regulator to understand a club’s finances, it can already obtain it. All clubs will be required to submit financial plans which detail, among other things, their revenues and expenses. These plans should capture details about player contracts and transactions where this information is relevant to the regulator understanding a club’s finances. Furthermore, the regulator has extensive information-gathering powers. Should it need greater oversight of the detail set out in this amendment, the regulator can already request this information, and it would not have to wait 12 months to get it. Therefore, I am confident that the Bill already delivers the intent of the amendment.
I am also grateful to the noble Baroness, Lady Grey-Thompson, and the noble Lord, Lord Moynihan, for Amendments 248A and 258A respectively, which focus on ticket prices. I understand that the noble Baroness intends to address the recent rise in clubs removing concession pricing on tickets and other such changes that have left some fans priced out of match attendance, and she highlighted concerns raised by fans from Reading. Fans are justifiably concerned, and I am exceptionally sympathetic to that. I am equally grateful for the attention by the noble Lord, Lord Moynihan, to ticketing and the issue of resale. These are huge issues that matter to fans, which is exactly why the Government have made it explicit that clubs must consult their fans on ticket pricing as part of their fan engagement. This also includes engagement on other operational issues, which is intended to capture many of the issues the noble Lord has made in his amendment. It is also important to note that any unauthorised resale of tickets for designated football matches is already addressed in the Criminal Justice and Public Order Act 1994. Many clubs take this exceptionally seriously and work with police and relevant authorities on it. However, the regulator should not be seen as a vehicle to fix all of football’s woes, especially those that are well within the gifts of clubs, leagues and the FA to address. On the noble Baroness’s amendment in particular, it would also not be appropriate for the Government to dictate prices or concession categories, and there is limited precedent for such an interventionist approach on commercial decisions.
Lord Moynihan (Con)
Before the Minister leaves that amendment, could she very kindly advise the Committee whether the Government intend to meet their expected deadline of a consultation exercise on the abuse of the secondary ticketing market by the end of this year?
Baroness Twycross (Lab)
If I may, I will clarify that in writing after this session to ensure I give the right response. I am not trying to avoid it; I will ensure I give the Committee a response.
Amendment 332 is from the noble Lord, Lord Markham, and the noble Lord, Lord Parkinson of Whitley Bay, also spoke to it. I appreciate that noble Lords may not welcome the use of delegated powers to amend the definition of “football season” in the Bill. However, to future-proof the Bill against any changes to the footballing calendar, we feel that the Secretary of State needs this power.
It is unlikely, but possible, that a specified competition might be organised in a unique way in the future, for which the current definition may not be suitable. For example, I am sure that noble Lords remember the impact of the 2022 World Cup on the domestic calendar. It is not beyond the realms of possibility that similar changes may occur in the future that impact the efficacy of this definition.
Lord Moynihan (Con)
I am now trying to be helpful, especially in the presence of the noble Lord, Lord Pannick, who will be able to opine on this suggestion. The reason why the Secretary of State has this power, as set out on page 46 of the memorandum to the Delegated Powers and Regulatory Reform Committee, is that a specific competition may be played over two calendar years. That is the current definition. If it were not to be played over two calendar years, we would not be able to proceed with the definition of “football season” set out in the Bill.
We have been looking for simplicity here. Instead of Clause 92(1) defining a “football season” as
“beginning with the day in a particular year on which the first match of any specified competition is played, and … ending with the day in the following year on which the final match of any specified competition is played”,
a simpler way would simply be to delete “in a particular year” and “in the following year”. Then we would all understand that we begin on the day on which the first match is played and end on the day on which the final match is played. We thus would not need secondary legislation through a draft affirmative resolution for the Secretary of State to come back to both Houses of Parliament, as this simple amendment could clarify it all and remove the Secretary of State from this onerous task.
Baroness Twycross (Lab)
I am not sure that the Secretary of State would find it onerous, because it is not intended to be used very often. However, the noble Lord makes an interesting point and I appreciate that he made it in the spirit of being helpful.
This is not a power for the Secretary of State to dictate to the industry what a season is; it is the opposite. The power as currently defined in the Bill will ensure that the definition can flex to changes in the industry. It will also be subject to the affirmative parliamentary procedure, so I hope noble Lords will rest assured that the House will be able to scrutinise any changes. I am happy to continue to discuss that further with noble Lords after Committee.
Lord Parkinson of Whitley Bay (Con)
I think it would be helpful if the Minister took this away, discussed it and maybe checked whether a solution like the helpful one my noble friend Lord Moynihan suggested might be possible. That would remove one of the delegated powers that the Delegated Powers Committee has raised concerns about.
I was struck by the answer the Minister gave to the intervention from the noble Lord, Lord Bassam, reassuring him about various matters of gameplay that are not within the scope of this regulator. The timing of the season seems to sit closer to things that she reassured him are not the job of the new independent football regulator to look at than to delegated powers for the Secretary of State. I hope she will take this away and continue discussions ahead of Report, because that feels like a very straightforward and sensible suggestion.
Baroness Twycross (Lab)
I was getting to the point where I was offering to take it away, so I think we are in violent danger of agreeing. On the question of the House being able to scrutinise any changes, I think we will return to this issue later, before Report.
Amendment 259 is from my noble friend Lady Taylor of Bolton. I understand that concerns have been raised about the ways in which rules are made in the industry today, including in recent legal cases. However, the Government’s view is that the amendment as drafted is not appropriate. The scenarios listed in Clause 55(6) could well be time sensitive and urgent. They may require immediate action from both competition organisers and the regulator. It would not be right to burden the competition organiser with a requirement to consult every member club for the purpose of informing the regulator of changes to the regime on an issue that may not affect them all. We would, of course, expect competition organisers to be carrying out appropriate consultation on their own rules. However, we are wary of the regulator mandating and prescribing how the leagues develop their rules.
I will finish on the two government amendments, Amendments 320 and 330. They both correct erroneous cross-references and make no change to the content of the Bill.
For the reasons I have set out, I hope that the noble Lord will withdraw his amendment.
Lord Mann (Lab)
My Lords, I am very reassured by the Minister’s clear words about the powers of and information from agents. Despite the valiant efforts of the noble Lord, Lord Pannick, we may be on the same side here, because I am in defence of British agents. With the complexities of football, there is nothing to stop anybody getting a legal cut from a transfer fee. The more transparency that is thrown on that, the more money is kept in the game.
The irony is that probably the main source of my information is agents. A second source is players and a third is owners and investors. The power of the agencies is often greater than that of the clubs themselves. That is the direction of travel. Therefore, it will be beholden on the regulator to ensure that at least there is maximum transparency. If a club wishes to give £1 million to another club in, say, Sicily for a player no one has ever heard of and who has played for two or three minutes, that is obviously a good business decision. The more out in the open that is, the healthier future the game has.
After that genuinely helpful reassurance from the Minister on my amendments, I seek the leave of the Committee to withdraw Amendment 129.
Lord Markham
Lord Markham (Con)
My Lords, I hope this will be a nice, quick and simple group ahead of dinner break business. Clause 17 refers to awarding or refusing a provisional licence. I think we all agree that, if a provisional licence were not agreed, it would have serious consequences for a club, which would not be able to carry on playing or start a season, for example. That would have serious consequences on the fans, as well. All this amendment seeks is to give clubs sufficient time to respond. Generally, in serious situations, 14 days is not enough time to respond fully, so the suggestion is to give clubs a month in these circumstances. I beg to move.
Baroness Twycross (Lab)
I thank the noble Lords, Lord Markham and Lord Parkinson of Whitley Bay, for their amendments. Apart from Amendment 148, which I will turn to shortly, they all seek to extend to a month the minimum period for clubs, individuals and competition organisers to make representations to the regulator on a number of issues—far longer than the 14 days that the Bill sets out.
The 14 days set out in the Bill for representations is the minimum to ensure that the individual concerned has a fair amount of time to prepare and present any representations to the regulator, though it is not an absolute. The regulator may choose to specify a longer period if it thinks it is appropriate. However, the 14-day minimum also means the regulator can respond quickly to urgent issues without an extended delay if necessary. We do not think it is appropriate to introduce unnecessary delays into the regulator’s regime that would slow down decision-making and leave clubs in an extended period of uncertainty. A 14-day period for representations is not uncommon among other regulators such as the FCA and CMA.
Turning to Amendment 148 specifically, I understand that the intention of the noble Lord, Lord Markham, is to ensure that, if the regulator is looking to revoke a club’s provisional licence, the club will have an opportunity to make representations. I reassure the noble Lord that this is already captured by Clause 18(4), which says that, if the regulator considers that a club has not met the full licence test, it needs to give the club notice. This must include
“inviting the club to make representations about the proposed action”,
be that to extend the provisional licence period or to revoke the provisional licence. To be clear, the regulator would look to revoke a provisional licence only if the club had persistently and without excuse failed to take reasonable steps to meet the requirements for a full licence. This is a high bar. Therefore, the club will have had sufficient opportunities to take remedial action even before the opportunity to make representations under Clause 18(4). The club will also be able to appeal a decision to revoke a provisional licence if it believes the regulator has acted unfairly. This is yet another way in which the regulator can be held to account and decisions can be scrutinised.
I will close with the question that Clause 18 stand part of the Bill. I understand that the rationale of the noble Lord, Lord Parkinson, in tabling the clause stand part notice is the same as that which we already discussed in relation to the earlier group on licensing. I am happy to provide further detail on Clause 18 in writing if the noble Lord wishes it, but, as I set out earlier, we do not believe there is a credible risk that clubs will refuse en masse to participate in the regime. Clubs at all levels of the game have welcomed this regime.
Lord Markham (Con)
I thank the Minister for her response. The main thing is not only having a sensible conversation but making sure that the regulator is aware that, where there are circumstances in which more than 14 days are required, it demonstrates that flexibility. I beg leave to withdraw the amendment.
Lord Bassam of Brighton
(d) the home ground threshold requirement (see paragraph 6).”Member's explanatory statement
This amendment makes it a threshold requirement (which a club must comply with to obtain a full licence) to meet certain requirements (as inserted by amendment 147) relating to the club’s home ground.
Lord Bassam of Brighton (Lab)
My Lords, I hope I can deal with this group of amendments fairly quickly. It is again a disparate group, but the main theme is fan consultation and the requirements on a club. The amendments seek to alter the fan engagement threshold requirement by requiring a club to have structures and processes for effective engagement with their fans.
It is vital that there are proper requirements to ensure that a club applying for a licence, for instance, has a suitable home ground for a minimum period of 20 years. This would help prevent owners using much-adored home grounds as bargaining chips and collateral to strengthen their financial muscle against the wishes of fans. The clauses that we seek to insert would incentivise clubs to protect their home grounds as part of their heritage and their history.
Amendment 142 concerns ticket prices. This is important because we are in a situation where clubs pretty much have a free hand in raising ticket prices. Let us take the recent example of Manchester United, which has, in effect, doubled the price of some tickets and removed discretionary or reduced ticket prices for younger supporters—my noble friend Lord Shamash could say more about that than me. The amendment would insert ticketing prices as a relevant matter for consideration in the process of regulation.
That is the spirit and intent of the amendments. I am looking for some reassurance from the Minister that fans will be properly engaged in clubs’ consideration of these issues, that there will be proper processes and ways of ensuring that their voices are heard and that issues such as ticket pricing in particular, and playing in prohibited competitions and so on, will be something the IFR can look at, comment on and, in some situations, determine.
Baroness Brady (Con)
My Lords, I rise to speak in response to these important amendments, all of which seek to strengthen the Bill’s provisions for consulting fans. We should pay tribute to noble Lords who have long championed the role of supporters in football, particularly those who have been involved in supporter trusts and similar bodies for many years. Their passion and their advocacy are no doubt one of the reasons that fan voices are becoming even more central to the governance of our national game.
I support the intent behind these amendments. Fans are the lifeblood of football. They invest not just their money and time but their hearts and identities into their clubs. Ensuring that their voices are properly heard, and heard with respect, is not just a moral imperative but essential for the long-term sustainability and integrity of football. The Premier League clubs recognise this too. In recent years, they have made significant progress in embedding fan engagement into their governance structures. Through its fan engagement standard—the first of any league to introduce such a standard—clubs are held to account for how they involve their supporters in decisions that matter to them. Fan advisory boards are now mandatory at every Premier League club and provide supporters with direct access to senior executives, enabling meaningful input on issues such as ticketing, matchday operations, club identity and community programmes. These initiatives represent a significant cultural shift. They create a platform for genuine dialogue between clubs and their supporters, ensuring that fans’ perspectives are considered at the highest levels of decision-making.
While I support the principles underpinning many of these amendments, I also feel it is important to raise a note of caution. Specifically, I want to raise the risks of the IFR being overly prescriptive when it comes to fan engagement and consultation. Clubs are not one-size-fits-all entities; each has its own unique character, fanbase and operating environment. For example, the dynamics of a global club with millions of international fans will differ significantly from those of smaller community clubs, many of whose supporters live within a few miles of the ground. Let us take, for instance, the idea proposed in some amendments that clubs must prove that a majority of their fans support certain decisions. While the intent is admirable and builds on the FA’s and many clubs’ approach to heritage assets already, we must acknowledge the practical difficulties of legally mandating such approaches.
How does a club definitively determine what constitutes a majority? Should a global fanbase have the same weight as local season ticket holders? What happens when opinions are divided? Would the IFR reverse a decision if, down the track, it was found that the wrong methodology had been used? These are complex questions without any easy answers. We should be careful not to create a compliance culture that detracts from the spirit of good engagement. It is really good to make this aspirational on both sides. For fan engagement to work well, the club has to feel confident, be open and get out of its comfort zone; the fans must enter into the debate in a constructive and open-minded spirit too. The difficulty will come if the IFR is drawn into micromanaging fan consultation and adjudicating on individual decisions, therefore inadvertently feeding an adversarial approach between fans, groups and clubs.
Now that might sometimes be appropriate, but I strongly believe the IFR will often be best to focus on ensuring that principles are upheld, leaving the specifics to clubs and their supporters. I also want to make the point that many of these new structures and processes for engaging fans, such as the fan engagement standard and fan advisory boards, are still new; they need time to bed in.
There are some brilliant examples of good practice already; for example, clubs bringing fan advisory board members into their clubs and having them spend time with football, commercial and operational teams so that they can understand the realities of life inside the club. But it is too early to say what the best approaches or designs of these processes will be. We should encourage more thoughtful approaches that allow these structures to mature and evolve, with periodic reviews to assess their effectiveness. A rush to codify overly detailed requirements risks stifling this organic progress and creating unintended consequences.
Lord Shamash (Lab)
My Lords, I am a very happy Manchester United fan. The last few minutes of yesterday’s game were bliss; they reminded us of what happened in 1999 when we won the treble.
I rise to talk again in relation to supporters’ trusts. I have been pressing this; I pressed it in debate the last week and, indeed, at Second Reading. The supporters’ trusts should be there on the face of the Bill. As I mentioned last week, there are 149 supporters’ trusts in the pyramid. Nearly all of them are recognised by the FCA and they operate under the Co-operative and Community Benefit Societies Act.
I ask my noble friend the Minister: why reinvent the wheel? We have a structure that works; it works very well indeed. I would ask that my amendment, “including supporters’ trusts”, be accepted. We understand—we are not trying to be prescriptive—that there will be other fan groups and people who might like to become involved in communicating with the club, but, having supporters’ trusts that exist throughout the UK, it would be a very sensible and easy move to make. I hope this amendment will be accepted.
Lord Mann (Lab)
My Lords, there is nothing wrong with supporters’ trusts, but working-class fans have other models as well, historically and currently; that voice also needs to be heard. Supporters’ trusts are one model and should be empowered, but they are only one model for football.
I have eight amendments here more or less doing the same thing. There is an issue here, which the noble Baroness, Lady Brady, alluded to and spoke to, with the fan advisory boards. There is a fundamental choice here, and I would advise the Government to be careful with the politics of this. Some clubs are choosing the fans to go on their fan advisory board; it is not the fans choosing the representation but the clubs. That is one model, but it is many miles away from the Crouch review. It is the total opposite of what fans would hope to see. The fans in this country have not gone for the German model and demanded comparative boards, 50% et cetera, supervisory boards, and that kind of power in relation to the clubs.
I have helped to establish a range of Jewish supporters’ groups. These are Jewish supporters who want no more than to be meeting up with other Jewish supporters of their club—full stop. But they do hope as well to be able to give the occasional bit of advice, sometimes very productively and positively, to their club—if the club does not refuse, as one has, to recognise a large group of Jewish supporters who simply want to be themselves—and, if there are any issues, they want to be listened to. It might be about the provision of kosher food, or ticketing policy, or that there are a lot of fixtures on a Friday night and people are finding it difficult to be religiously observant and still be able to go. It might be to do with giving advice on issues relating to racism within the stadium. On issues like these, this is a group that should be listened to; it is not a group that should have the power to tell a club what to do.
But the idea that fan advisory boards should be chosen by the club is anathema to fans. Fans are perfectly capable of choosing their own representatives. Let us think about what will happen if this Bill goes forward and the regulator has powers, but clubs can still say to fans, “No, we will choose who the fan voices will be. We will pick persons 1, 2, 3, 4 and 5. They will be there under our criteria. You, the fans, will have no say”. What will happen is that conflict will emerge, and the Government will not come out of the conflict well. The perception will be that the Government had the chance to ensure this.
Let us think about a supporters’ trust, made up of people giving of their free time to organise. As a member, you elect whoever to be your representatives, and they are then your representative; it is not the club coming in and saying, “No, we will pick Lord Shamash because we love Lord Shamash. If he is elected, that is all well and good because he represents what we would like to see in Manchester United”. That would be an invidious position for anyone to be in. I hope the Minister can give some reassurance that the fan voice on those big issues—moving the ground, changing the colour, changing the name—will actually be a fan voice. If it is not, then government and Parliament will become unpopular at some stage.
Lord Jackson of Peterborough (Con)
My Lords, I want to respond very briefly to Amendment 224 in the name of the noble Lord, Lord Mann. He made a wonderful peroration, but I am not sure it bore much relation to the amendment that he has laid down. Of course, none of us wants clubs to hand-pick fans who will be nodding dogs— ersatz fans who will go along with the corporate line of the football club. We do not want that.
I am not sure if this is a probing amendment for Ministers to consider before we get to Report, but it is a lock. It locks in and fetters the discretion of football clubs to make decisions that might be existential for the future of that club; in other words, diversifying activities, and not just in terms of the freehold. Clause 46 specifically mentions—
Lord Mann (Lab)
I thank the noble Lord for giving way. If it was proposed that Peterborough was to be moved to King’s Lynn, or to Norwich, should not the Peterborough fans have the right of veto on moving their club out of their town?
Lord Jackson of Peterborough (Con)
Perish the thought. There are many Peterborough fans who do not live in the city of Peterborough but in the Fens; they may not be too displeased at going to King’s Lynn—not that I am in any sense proposing that. He alludes to the Posh. The Posh have been able to develop a number of commercial activities over the last few years. Darragh MacAnthony, the owner, started out in 2007 as a very rich man. Now he is just a rich man, because of his love for Peterborough United.
The point is that that club has been able to stay afloat financially because the board of the club, backed—disproportionately I would say—by the fan base, has supported the diversity of activities. The noble Lord’s amendment and Clause 46 as written would lock out the possibility of many clubs and boards making decisions to protect their long-term financial sustainability.
I respectfully say to the noble Lord, for whom, as he knows, I have huge respect—particularly for the great work he has done on kicking out anti-Semitism in football—that that is a different issue from regulated fans and setting up fan organisations. This amendment would be quite prescriptive for clubs, and it would not be in their long-term interests, particularly those teetering on the edge of financial instability and unsustainability. For that reason, I hope the Minister will consider these issues when she responds to the noble Lord’s amendment and others.
Lord Watson of Invergowrie (Lab)
My Lords, I will speak to my Amendment 138A on what consultation means. The wording—
“leave out ‘consults’ and insert ‘meets regularly with’”—
is taken from the Explanatory Notes. On page 44, paragraph 271, under the heading “fan consultation”, they say the following:
“This mandatory licence condition … requires clubs to regularly meet with a group which the IFR considers representative of the club’s fans, which could be a group elected by the club’s fans”.
Throughout these debates, many noble Lords have quoted the Fair Game document, which refers to fan engagement as a communication process, and to a range of formal and informal face-to-face processes being part of that. That is what I am trying to get across here. It is important that clubs meet regularly with the fans and do not just consult. To consult could mean anything. It is not exclusive—of course, it could take various forms—but they must meet regularly. I hope that ultimately, the Government will accept that. It remains to be seen, but I will return to this issue on Report because it is very important.
I will comment on some other issues that noble Lords have raised, particularly my noble friend Lord Mann, who I usually agree with. I did not really take to his dismissive comment in response to my noble friend Lord Shamash. My noble friend Lord Mann said that it is all very well having supporters’ trusts, but you need organisations with working-class members. I do not know much about the Manchester United Supporters Trust, but I am sure it has working-class members.
I am a member of two trusts and have been for some 20 years. One is in Scotland—my old club, Dundee United; I pay £15 per year for that. I am also a member of the AFC Wimbledon trust, called the Dons Trust. I pay the princely sum of £10 per year for that. For that reason, I think there are more than a few working-class fans. I think that my noble friend Lord Mann was suggesting that supporters’ trusts price some fans out. I do not know if that is the case, but I would not have thought so. By definition, you would think that would be rather pointless.
Lord Mann (Lab)
My noble friend has misinterpreted my comments. Supporters’ trusts—I have been heavily involved in one as well—have all sorts of members, but there are other kinds of organisations that have never had the objective that supporters’ trusts have. That is the point: there are different types of organisations. Some purely want to go and watch football and not take on the more significant interests and structures that supporters’ trusts have.
Lord Watson of Invergowrie (Lab)
I thank my noble friend, and I fully accept that point; I have misinterpreted what he said. He seemed to be suggesting that trusts were different from other supporters’ groups. There are a wide range of groups and that is exactly the way it should be.
I am afraid I cannot go along with my noble friend’s Amendments 139 and 140. I am not opposed to them per se, but he seems to be distinguishing between fans and elected representatives of club supporters’ groups. Surely, these are the same people: you cannot be an elected representative of a supporters’ group if you are not a fan.
Lord Addington (LD)
It is nice to have a little fan club.
My amendment may be making the ultimate pedant’s point, but the Bill says that a relevant thing that cannot be interfered with is the name of a team operated by a club. My amendment refers to the name of the club itself. Is my point covered by this? I do not know. If it is, tell me where and I will be terribly happy.
The main point is that we will be still talking about who a fan is this time next year unless the Government make a decision and come up with something solid. It affects how the regulator operates and who they exclude. The Government may well have to decide who they are going to offend, but please let us do it, because otherwise fan involvement will mean nothing.
Lord Maude of Horsham (Con)
I would like to make a short point, but it is an important one that has barely got a mention. Football clubs have a very strong interest in consulting their fans. The fans are their customers. The truth is that, if you look across the gamut of clubs all the way down the pyramid, the composition of those fan bases will be very different. Broadly speaking, the higher up the pyramid you go, the more dispersed the fan base will be. Famously, almost none of Manchester United’s fans actually live in Manchester.
Lord Maude of Horsham (Con)
I am sorry that we did not have a proper exchange, because I was looking forward to that.
The reality is that the revenue that local community clubs get is predominantly gate money—match day revenue. As you go up the pyramid, a greater proportion comes from commercial sponsorship and merchandise; and then, when you get to the Premier League, pretty much half or more is broadcasting revenue.
I am indebted to my noble friend Lady Brady for this. More than half of the Premier League’s revenue from broadcasting is international—that took me by surprise. The next-largest part is commercial—sponsorship, merchandise and so on—and the smallest part is the matchday revenue. The point is that all this comes from the good will of fans, either directly from their pockets or because of their engagement and commitment. Tottenham happens to have a very large fan base in South Korea because our captain is South Korean. Our biggest sponsor is an Asian insurance company. Why is it supporting Tottenham? It is because there is a huge fan base in Asia.
After all, as we know—although we are sometimes shy of saying this in these debates—the Premier League is the goose that lays the golden eggs that then cascade down through the pyramid, to a much greater extent than in any of the football pyramids in other European countries. Therefore, the way in which clubs consult will be very different—but the suggestion that they need a regulator to enforce upon them the duty to consult their fans is to ignore this really important point: it is in their interest to keep their fans, wherever they are, on board. If ever there were a vivid illustration of that, it is when the European super league proposal came up. It was killed not by politicians, a regulator, your Lordships’ House or the other place but by fans.
Lord Markham (Con)
I will speak briefly to my Amendments 238 and 241. I agree with noble friend Lord Maude that it is absolutely in the clubs’ best interests to make sure that they are consulting their fans on this. If we are going to put things down, though, I will speak to two essential points.
A football club shirt is more than just the colours; it is the design as well. Any football supporter would know that the blue and white hoops of QPR are quite different from the stripes of Brighton—fans could maybe be involved in that. I remember with some humour that one Brighton design was a bit like a Tesco bag and the fans used to wear an actual Tesco bag. That probably cost the club a lot of money in lost shirt sales. But, generally, the fans have a role in that and in the name of the club—my Amendment 241 is on this—which I think most people would agree is fundamental.
Lord Parkinson of Whitley Bay (Con)
I am glad that the Government Chief Whip has been here to see the lively debate on all sides of the Committee, including on his own Benches, on this group. He will have noted that only two of the 19 amendments come from the Opposition Benches. So I am very glad that he has been able to join us for this lively discussion as we head into dinner.
I will not elaborate on the points that my noble friend Lord Markham made on his two amendments, to which I added my name, other than to say that I wholeheartedly agree. Given that the Government are already looking at club colours, I am interested in why this is not extended to home shirt design, which my noble friend mentions in his Amendment 238.
On my noble friend’s Amendment 241, the name of a club is hugely important. It is not uncommon for clubs to change names. I gather that Bournemouth began life as Boscombe St John’s Lads’ Institute and Arsenal started as Dial Square, in the Dial Square workshop, and then became Royal Arsenal, I think because of a local pub called the Royal Oak, and Woolwich Arsenal—
Lord Parkinson of Whitley Bay (Con)
I think that is an informal one from fans of other north London clubs. But clearly the names of clubs do matter, and we would be interested in whether the Government agree with that.
Given the time, I will address the other amendments in this group as a whole. They attempt to require clubs to consult a whole host of different supporters’ organisations, community trusts and fan groups. I share the concerns raised by my noble friend Lord Jackson of Peterborough that, if clubs are required to consult numerous different groups—chosen through various methods and representing countless, and often competing, interests—it will be difficult for clubs to know to whom they are to listen. What opinions will they have to take on board and whose interests will win out? There is also a concern about whether this could lead to divisions forming among supporters’ groups of differing views, as they seek to influence the activities of a club in a manner that they would like.
I am concerned by what the noble Lord, Lord Mann, said about football clubs picking the people who sit on their fan groups. That sounds like having a House of Parliament entirely dominated by the Executive—but that is for another Bill. The concern about this one is the old adage that too many cooks spoil the broth; that is, if we tried to have too many people vying to influence the views of a club, it would be difficult to differentiate the differing sounds and, perversely, fans’ voices would be drowned out in that cacophony. So a simpler approach might be required for fan engagement.
Trying to have a better answer to the question of who fans are, as we have said previously, runs to the heart of all this. But I agree with what my noble friend Lord Maude said: clubs are well advised to take on board the views of fans. They listen to them because they are the lifeblood of the clubs, and they make their views known pretty volubly.
Baroness Twycross (Lab)
I thank noble Lords for their continued engagement on these important provisions of the Bill. I appreciate that I am one of the very few things standing between noble Lords and the dinner break, but I want to give a proper response and, I hope, the reassurance that my noble friend Lord Bassam of Brighton is looking for. We must not forget that, at the heart of all of this, it is the fans who matter the most. Football is nothing without them, and the fan engagement threshold requirement has been designed to reflect this. As the noble Baroness, Lady Brady, said, fans are the lifeblood of the game.
My noble friend Lord Bassam’s Amendment 138 seeks to make it explicit that clubs must have the appropriate structures in place to engage effectively with fans. I hope noble Lords can take comfort that this is already implicit in the Bill. The Bill already asks for all clubs, in order to meet their fan engagement threshold requirement, to have adequate and effective means to consult and take the views of fans into account. It would therefore not be possible for a club to meet this bar without also having the appropriate structures and processes for effective engagement with its fans.
On my noble friend Lord Watson of Invergowrie’s Amendment 138A, it is important to avoid fan engagement becoming a box-ticking exercise for clubs. The intent is to ensure that dialogue can be constructive for both parties. This is why the threshold requirement requires a club to consult fans on the relevant matters. Consultation goes beyond just a meeting, which might lead fans to have only a passive role at their clubs. Instead, we expect clubs to seek input from fans on issues, with that input directly feeding into the decision-making or a club’s understanding of an issue.
I do, however, reassure my noble friend that the expectations on clubs will be proportionate to club resources and the demographics of the fan base. I hope that other noble Lords, including the noble Baroness, Lady Brady, also feel reassured by that point. This will not be the same as the statutory consultation, and we expect that the regulator will provide more detail about what consultation should look like in practice. This will allow for a bespoke approach to be taken across clubs.
My noble friend Lord Watson raised points around making fan engagement more explicit. The intention of the regulatory principle is not to list every possible stakeholder the regulator should ever engage with during the course of regulation, however important that stakeholder might be. That could be a slippery slope to an enormous list that risks—
Lord Watson of Invergowrie (Lab)
I understand my noble friend’s point about every stakeholder, but can she name a stakeholder more important than the fans?
Baroness Twycross (Lab)
My noble friend is quite clear, as are we, that the fans are central—I made that point earlier. However, making an explicit list for every single type of consultation that the regulator should have could mean that an unintended consequence would be that we missed off important stakeholders. The intention of the principle within the legislation is to encode a participative approach into the regulator’s regime. We believe that the regulator will be more effective if those being regulated participate constructively; that is to say, they are brought in and are pulling in the same direction. It is already clear from the very purpose of the Bill and its origin that the regulator will be regulating in the interest of fans and communities. As part of this, it should of course engage with them and representative groups, as appropriate.
On Amendments 160 and 163, from my noble friend Lady Taylor of Bolton, I reassure her that, where there are concerns that a club is not meeting the fan engagement standards, the regulator is empowered to gather information and look further into the situation. As it is a licensing condition, a breach of these requirements will qualify as a relevant infringement; if deemed necessary, the regulator can take enforcement action. The regulator will have the ability to receive evidence from fans when considering whether a club is meeting its licence condition or any other concerns in the regulator’s remit, but it will not adjudicate all consultations.
Lord Bassam of Brighton (Lab)
My Lords, I think this has been one of the better debates on the football regulator. It is about one of its core purposes and, as the Minister has just said, it all flows from the fan-led review and putting fans at the heart of our football business.
I thank the noble Baroness, Lady Brady, for her contribution. I well understand the mix of commercial pressures and the way in which that can collide with what might be seen on the face of it as being fan interests. It is a difficult balance that one has to try to secure in this legislation. I think the legislation does that, but who or what is a fan or a supporter is a difficult question, and they may not be the same thing all the way through. The noble Baroness raised the question of who it is relevant to consult over some of the issues. I think we are heading in the right direction with further clarity. I hope that the regulator can try to work its way through some very difficult issues here.
I am very happy with the responses that the Minister has given, and I think other noble Lords will share that sentiment. I beg leave to withdraw my amendment.
Puberty-suppressing Hormones
(2 days, 6 hours ago)
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Lord Kamall (Con)
My Lords, I thank the Minister for the Statement and the right honourable Secretary of State for the careful and sensitive way in which he delivered the Statement in the other place. In line with my right honourable friend the shadow Secretary of State in the other place, from these Benches we welcome the Government’s announcement. Whatever your politics, most people believe that one of the first duties of any Government is to protect their citizens, especially our children.
As the Secretary of State said, there has been too much heat, and perhaps toxicity, around the issue of services for children experiencing gender dysphoria, so I welcome the tone with which His Majesty’s Government have approached this issue—less heat, more light—and that they continue to take an evidence-based but compassionate approach. I also take this opportunity to thank the noble Baroness, Lady Cass, for leading the review on gender services for children. The Cass review highlighted the importance of putting scientific evidence above ideology and laid out the fact that we simply do not know enough about the long-term impacts of puberty blockers on children. That is why my right honourable friend in the other place, the Member for Louth and Horncastle, when Secretary of State, banned the routine prescription of puberty blockers for gender dysphoria, and later extended that ban to private clinics.
We welcome the decision of the Government to follow the recommendations of the independent Commission on Human Medicines to extend the banning order until a safe prescribing environment can be established for these medicines. This is a common-sense approach, and allows time for more evidence to be examined to consider the holistic and long-term impacts of puberty blockers on children. The Secretary of State announced the clinical trials to gather evidence but, given understandable concerns about the risks of any clinical trial, can the Minister reassure your Lordships that these trials will have robust safeguards to ensure the well-being and safety of any children taking part, while recognising the importance of having these trials in the first place?
The Secretary of State in the other place also spoke about alternatives to puberty blockers for children suffering from gender dysphoria. As someone who takes an interest in social prescribing, I welcome the Government’s recognition that medication is not always the best solution, so will the Minister share details of some of the alternatives to puberty blockers that will be offered to children?
Finally, noble Lords will be concerned that, despite the lack of evidence, puberty blockers were prescribed to children with gender dysphoria when their safety could not be guaranteed. What steps are the Government and the NHS taking to ensure that a similar situation does not occur again and that future decisions are led by evidence? I look forward to the Minister’s responses.
Baroness Walmsley (LD)
My Lords, on these Benches we welcome the tone of the Secretary of State’s Statement. I have often said that there are many ways of being human. Growing up can often be a very trying time for teenagers. How much more difficult, then, for those young people with gender distress who are struggling with finding out who they are while being different from their peers, and all without adequate support? It is high time that proper services were put in place for young people struggling alone with these issues. Their families too need help to support them at this difficult time. For too long, children and young people who are struggling with their gender identity have been badly let down by a low standard of care, exceptionally long waiting lists, even by the standard of mental health waiting lists, and an increasingly toxic debate.
We always want to see policy based on the evidence. With any medical treatment, especially for children and young people, the most important thing is to follow the evidence on safety and effectiveness. It is crucial that these sorts of decisions are made by expert clinicians, based on the best possible evidence. It is also important that the results of the consultation and the advice of the Commission on Human Medicines are made public.
Some might wonder why the treatment is deemed not safe for gender dysphoria patients but safe enough for children with early-onset puberty. More transparency might clear up the confusion and give more confidence to patients and their families. However, the Secretary of State himself admits that he does not know what effect the sudden withdrawal of this treatment for young people already embarked on a course of puberty blockers will have. These are the young people with the most urgent need for other types of care in the current situation, so what clinical advice have the Government taken about the effect of withdrawing these drugs on the physical and mental state of young sufferers of gender incongruence already on the drugs, and what physical and psychological support will be offered to them?
In the current circumstances, plans for a clinical trial are welcome, but we would like to know the criteria for those eligible to participate. What assessment have the Government made of the recent Council of Europe report, which raises the ethical and rights implications of offering participation in the trial to only a small group of patients? If the only way to continue access to these drugs is through participation in the clinical trial, whose scope, length and start date have yet to be announced, this lays the Government open to accusations of coercion and breaches of human rights.
We welcome the plans for additional treatment centres in Manchester and Bristol as well as London, but can the Minister say why they will not be up and running for two years? Is it lack of funding, lack of premises or lack of sufficient therapists with the appropriate specialist training? This is a very sensitive area, so the wrong people could do more harm than good. If that is the reason, is there a plan for training up more qualified therapists in time for the opening of the regional treatment centres? I very much look forward to the Minister’s replies to these questions.
The Parliamentary Under-Secretary of State, Department of Health and Social Care (Baroness Merron) (Lab)
My Lords, I start by thanking the noble Baroness, Lady Cass, for her work in this very important area. I also refer to the actions taken by the previous Government, which set in train the action we are continuing. As both the noble Lord, Lord Kamall, and the noble Baroness, Lady Walmsley, rightly said, this is about keeping children safe. There is nothing more important than evidence-based action—which is what we have before us—and taking the necessary steps.
The Cass review made it clear that there is not enough evidence about the long-term effects of using puberty blockers to treat gender incongruence to know whether they are, first, safe and, secondly, beneficial. It is important to bear both in mind. The Commission on Human Medicines independently found that clear evidence of unsafe prescribing exists and recommended that there should be a ban until there can be a safe prescribing environment. That is where we start, and last week’s laying of legislation stops that unsafe prescribing to children and allows time to develop the necessary safeguards, as recommended by the commission. I should just clarify that the legislation is indefinite, not permanent. There will be a full review in 2027 so this continues to be a very live issue.
The clinical trials, referred to by both the noble Lord, Lord Kamall, and the noble Baroness, Lady Walmsley, will be a world first. It is important to pay tribute to that. In addition to the work currently being undertaken to respond to the recommendations of the Commission on Human Medicines, the trial is presently undergoing development and approvals. The aim is to begin recruitment early in the new year. I am sure there will be an opportunity to update the House on that detail.
In answer to the point from the noble Baroness, Lady Walmsley, the numbers will be uncapped, which is important. I am sure we all agree that better-quality evidence is critical. The development of the clinical trial between the National Institute for Health and Care Research and NHS England will provide the better-quality evidence that we are all looking for.
The noble Baroness, Lady Walmsley, spoke about new services. To make the situation clear, NHS England has already opened three new services in the north-west, London and Bristol. The fourth will be in the east of England and will open its doors in spring next year. The noble Baroness also asked about the timetable; we are on course to have a service in every region of England by 2026. I cannot always confirm developments of that nature, so I am glad to do so because it will help reduce the waiting list, which noble Lords are rightly concerned about. It will also bring services closer to home, which is crucial too.
Furthermore, this is a very specialist area, so recruitment and training are key. This is part of the reason for the—I would not call it a delay—realistic timetable. There is also the need to work with local trusts and take into account all the various operational considerations, so realism rather than delay is how I would put it to the noble Baroness.
I agree with the points made by noble Lords on the Front Bench about tone and discourse. I am very grateful to the noble Baroness, Lady Walmsley, and the noble Lord, Lord Kamall, for welcoming the way the Secretary of State made the announcement and what the announcement refers to. We have a real responsibility in this House—and outside it—to handle conversations on this topic extremely sensitively. This is about people’s lives. I absolutely agree with the point just made: the public debate has been frighteningly toxic. Irresponsible statements made recently have put young people at risk of serious harm and that has to stop. That is one of the many reasons I welcome the Statement—and the tone and discourse this evening.
On the point made by the noble Lord, Lord Kamall, about alternatives to puberty blockers, no exact alternatives are being offered. However, within the new services there will be an emphasis on, for example, psychosocial support.
In response to the point made by the noble Baroness, Lady Walmsley, about the—she did not use this word, but perhaps I might—transparency of evidence, all the commission’s recommendations have been published in full as part of the Government’s response to the consultation. The full advice, as I hope the noble Baroness will understand, was prepared solely for Ministers, but we are considering whether it should be published. I know the noble Baroness will understand that, as with all advice prepared for Ministers, there are legal and other matters that must be considered before it can happen.
I will say a word on mental health support, which is so important for children and young people. An offer of an appointment with a mental health professional has been made to everyone on the national waiting list for children and young people’s gender identity services. Those who joined the waiting list on or after 1 September will have an appointment with a mental health professional or paediatrician before being referred to specialist gender services. Those who are not on the waiting list and are directly affected by the restrictions can access NHS mental health services through a dedicated single point of contact, supported by clinical nursing.
I hope that is helpful, and if there are any points I have missed—
Baroness Walmsley (LD)
Can the Minister address the issue of the children who are part-way through a course of treatment? Will they get mental health support as a priority?
Baroness Merron (Lab)
For those who are already on puberty blockers, there is an immediate withdrawal. But I hope that what I have outlined on mental health support covers all the areas the noble Baroness, and indeed all of us, are concerned about. The approach is as compressive as possible, and the new gender services I described should make it even easier to provide the service. It is not a matter of waiting until 2026; we absolutely understand the need to provide that support now, and we are making that available.
Baroness Cass (CB)
My Lords, I echo the thanks given to the Secretary of State for his careful and scientific approach to this issue and for his very sensitive Statement in the other place.
It might be helpful to elaborate on just one or two of the points that have been raised, particularly the use of puberty blockers for precocious puberty—that is, for children who enter puberty too early—which is a licensed use of these drugs. We are confident about that use because we have many years of experience, and because it is a very different situation from prescribing for young people with gender dysphoria. The difference is that children with precocious puberty have an abnormal hormone environment, which we normalise, whereas in young people with gender dysphoria we are taking a normal surge in pubertal hormones and disrupting it. That is why it is much less clear what the long-term impact of that intervention is, and why we need careful clinical trials.
The second thing it would be helpful to clarify is the appropriate question, asked by the noble Baroness, Lady Walmsley, about children and young people who are already on puberty blockers from private or overseas sources. In addition to the comments made by the Minister, it is important to know that NHS England has set up a telephone number that young people and families can ring to receive a mental health triage. Young people’s mental health services have been forewarned and are on hand to provide that triage for that small group of young people who may be in significant distress because of fear of interruption of their supply of puberty blockers. There is provision that, in those circumstances, and where the clinician thinks it is in the best interests of that young person to continue on puberty blockers, an NHS prescriber is allowed to continue the prescription. We hope that those in distress will come forward and contact NHS England and therefore be supported through the system.
One of the other misunderstandings about puberty blockers is that they have become totemic as the main treatment or entry-point treatment for young people who want to transition, or who may in the longer term be trans but may not go on to a medical pathway. Young adults have said to us that they wish they had known when they were younger that there were more options for them than a binary medical transition, and that there were many more ways of being trans—that they could remain gender fluid, continue to be non-binary, or in the longer term continue to be a cis adult, as some do, and not go through any medical interventions at all.
Having a multidisciplinary team that can support young people in that decision-making without necessarily rushing them into a medical pathway is crucial, and that is what the new services have now embarked on doing.
Baroness Merron (Lab)
I thank the noble Baroness for bringing her expertise directly into the Chamber. We are very glad that she is in the House to do so, and she has actually answered a number of the points better than I ever could.
I will emphasise one point that I am particularly interested in, because I know it has been raised a lot, about why the legislation is being laid in respect of the use of medicines just for gender dysphoria. The noble Baroness, Lady Cass, referred to this. It is really important to emphasise that the medicine might be the same, but the fact is that it is not licensed for gender incongruence or dysphoria—that is the key point. These medicines have not undergone that process, which means that safety and risk implications have not yet been considered. It is true that there are licensed uses of the medicines for much younger children or for older adults, but the issue here is about adolescents, and it is an entirely different situation.
Lord Winston (Lab)
My Lords, perhaps I might return to the conventional asking of a question to the Minister—a very quick question. There are a number of practitioners who are considering, if not giving, sex steroids to patients who are requesting gender reassignment; either oestrogen or progesterone, or the equivalent male hormone. Have the Government yet considered how patients will be treated in this situation? There are certain, clear dangers involved.
Baroness Merron (Lab)
I understand the point my noble friend rightly raises, and I emphasise again that what matters here are safety considerations—particularly when we are talking about children and young people—but also the evidence in respect of treatments, that there should be the prescription only of medication which is safe and appropriate to the actual patient and situation.
Baroness Jenkin of Kennington (Con)
My Lords, given that puberty blockers almost invariably lead to cross-sex hormones, can the Minister explain why the proposed trial cannot study those who have already used or are using puberty blockers, rather than starting with a new cohort of children? Given that the trial will look at the long-term effects on health, does she have any indication of how long that trial will need to continue, and is it right that it might be for up to 30 years?
Baroness Merron (Lab)
I do not recognise the last point that the noble Baroness made about the time. The aim is to start recruiting participants in spring next year and, as I mentioned, the National Institute for Health and Care Research is working with NHS England to develop the clinical trials. They are the first in the world and I will be very pleased to provide further information as and when it is available.
Baroness Fox of Buckley (Non-Afl)
My Lords, I commend the Secretary of State—and, indeed, the Minister. I commend the Secretary of State for his very clear Statement and for his courage, because he has had to stand his ground. He kept his cool, despite receiving unpleasant smears and abuse not only online, but even, to a certain extent, from the Back Benches in the other place.
I am slightly confused about something. I think we can see now that puberty blockers are a medicalised euphemism for chemical castration. The same kinds of drugs, when given to Alan Turing, were used as punishment for being gay. I am still not convinced, and do not really understand why the Government still think it is appropriate to conduct a clinical trial on children with these drugs. The Minister emphasised “uncapped” as though that was positive, whereas I thought that was scary.
As this medical scandal unravels, more and more young people are de-transitioning, but the NHS has no services to deal with this. I wonder whether the Minister would agree, perhaps, to meet some of the charities that are doing this kind of thing—there is Genspect’s Beyond Trans and its special service providers—just to discuss what the NHS might need to look at, moving forward in a different way.
Baroness Merron (Lab)
I very much welcome the generous and supportive comments of the noble Baroness, Lady Fox, in respect of the Secretary of State’s Statement. I am grateful for those. I note that she finds the reference to “uncapped” scary. I presented it as the way to gather the widest amount of relevant evidence, because that is a clinical trial; that is what is so important. The reason it is being done is that there is insufficient evidence and there has not been such a trial, and we need to do one for this particular situation.
In respect of meeting charities and others, the Secretary of State has been very keen to—what I would call—reset the relationship with various groups which all have different sets of thoughts on this. I have joined him in those meetings. He has also been meeting those with lived experience. We continue to do so. We have wanted to detoxify the debate, and those meetings have helped immensely. We will continue to have that listening ear.
Baroness Morgan of Drefelin (Lab)
My Lords, I too welcome the Statement. The tone, as we have already heard, has been absolutely right. Thinking about the clinical trial, I would like to know a little more about the timing. If we are intending to run a clinical trial that is going to be looking at efficacy and safety, it will not be an easy trial to run and it is going to take some time. It would be really welcome if the Minister could keep the House informed, which she has already promised to do.
I am particularly interested in hearing the Minister’s view on the following point. It is really important to get this clinical trial on the puberty blockers going, but we also need to understand the value and the evidence supporting all the other interventions too—the psychosocial support, the psychological support, and all the other interventions—so that it is not just this clinical trial but a broad understanding of what really helps these young people. `
Baroness Merron (Lab)
My noble friend is right to raise the second point. It is a whole range of interventions, and that is certainly something that we have very much in mind for consideration, for the reasons that we have heard in the Chamber this evening and the points that my noble friend makes. In respect of timings, it is a planned pathway study and that includes a clinical trial component. It is, as I said, to build evidence. I am glad to say that it remains on track to commence recruitment early in 2025, but only after there has been ethical approval. When that is granted, that is when the final study protocol will be ready, and I know that noble Lords will have a lot of interest in that. We will be issuing further updates in early 2025, and if there are any particular questions, noble Lords are very welcome to raise them with me.
Baroness Bennett of Manor Castle (GP)
My Lords, my question follows on from that of the noble Baroness, Lady Walmsley, about the scale of the trial. I also note the report from the experts at the Council of Europe, which the noble Baroness referenced. In the other place, the Secretary of State said in response to my honourable friend Carla Denyer that the clinical trial would be “uncapped”, and the Minister repeated that word this evening. However, an article published yesterday in the Metro, arising from various freedom of information requests and headlined, “Trans Youth ‘Languishing’ While Waiting Six Years For Gender Healthcare”, said:
“If a trans young person joined the waiting list for gender-affirming healthcare on the NHS today, they would have to wait 308 weeks for a first appointment”.
In that context, I am struggling to understand where the Government will secure the resources from to run a trial to provide the resources needed to have this uncapped clinical trial allowing access to puberty blockers.
Baroness Merron (Lab)
In view of what the noble Baroness said, it is quite important to consider that the children and young people’s gender services waiting list currently has 6,237 people on it. I certainly agree that waiting lists for these services are too long. We are committed to changing that, which is why I outlined the timetable for the new gender services and the opening of the new centres. They will increase clinical capacity and reduce waiting times for sure. On the point the noble Baroness raised, there is a commitment to the clinical trial, and I am glad there is. As we have brought forward this legislation in an absence of evidence, it is incumbent on us, as a Government, to follow through on what the previous Government started in train, which is to use a clinical trial to provide the evidence. Otherwise, the debate would remain uninformed and not evidence-based, and that cannot be helpful.
Lord Jackson of Peterborough (Con)
My Lords, I welcome the Statement and congratulate the Secretary of State on the moral clarity and leadership that he has shown in balancing the evidence base with compassion. Perhaps I may press the Minister on a few points. An indefinite ban is not the same as a permanent ban. Is there a chance that the indefinite ban, which goes to 2027, may segue into a permanent ban as more information and evidence arise over the next few years?
Given that it is pretty well understood that puberty blockers have given rise to fertility problems, bone health issues and psychological health issues, I cannot understand the inconsistent policy of keeping children currently on puberty blockers in the system, when we know that there is no positive evidence base and only a negative one. I think that will affect many children.
My final point is about the eight new regional centres that will be set up. Will we be certain that the ideologically-driven zealots—clinicians who misuse their position and have prescribed unsafe puberty blockers for children and young people—will not find themselves in these new facilities? That is an important issue as we wait for the clinical trial and ruminate on the issues that the noble Baroness, Lady Cass, mentioned. We need to start again on this and to understand that there are more treatments available for the most vulnerable children, who we need to protect, than merely puberty blockers.
Baroness Merron (Lab)
I certainly agree with the noble Lord about the vulnerability of children and young people in this regard, which is why we are taking this action. His last point gives me the opportunity to say that we are committed to implementing the recommendations of the Cass review in full. That is a very useful guideline and tool for us to use.
I have no expectation that the situation that the noble Lord described in his third point will happen. Recruitment is subject to all the usual provisions, and I know that the gender services will seek to recruit very positively. If the noble Lord finds out anything else, I am sure he will raise it with me.
On whether the ban could become permanent, the review—at the risk of repeating myself—will report in 2027, as the noble Lord said. I believe that we should wait for that.
Baroness Grey-Thompson (CB)
My Lords, like other noble Lords, I welcome the tone of the Statement. In today’s society, there is huge pressure on young people, through social media and more widely. I would really not want to be a teenager right now.
There is also huge pressure on the NHS, with multiple calls on its services. Can the Minister elaborate a bit more on how His Majesty’s Government are going to increase the number of staff and make sure they are trained to support young people? How can we support those staff? This is a tough area for them to work in. We also need to protect them from malicious complaints to make sure that they can do their job.
Baroness Merron (Lab)
I am glad that the noble Baroness has raised the issue of staff. It is vital that people are allowed to go about their work—as the noble Baroness, Lady Cass, should have been too—without fear of physical, verbal, online or direct abuse. I am sure that we all agree that the abuse has been an absolute disgrace. I agree about protecting those who are doing this. On the point about service, as has been said, this is about a group of vulnerable children and young people. It is our duty to provide the services to support them and to make them evidence based.
Football Governance Bill [HL]
Monday 16th December 2024
(2 days, 6 hours ago)
Lords ChamberRead Full debate Football Governance Bill [HL] 2024-26 View all Football Governance Bill [HL] 2024-26 Debates Read Hansard Text Watch Debate Amendment Paper: HL Bill 41-V(a) Amendment for Committee (Supplementary to the Fifth Marshalled List) - (13 Dec 2024)
Lord Foster of Bath
“(f) gambling advertising and sponsorship.”Member's explanatory statement
This amendment requires clubs to consult fans on gambling advertising and sponsorship.
Lord Foster of Bath (LD)
My Lords, I begin by apologising that my involvement in the Product Regulation and Metrology Bill has prevented me from attending earlier sessions of your Committee’s deliberation. But I am very conscious that the fan-led review, which in a sense led to the Football Governance Bill, found that many fans raised severe concerns about the level of gambling advertising and sponsorship in sport. This is especially notable because it was unprompted, yet nothing in the Bill addresses these concerns. It should, and that is why I am moving Amendment 143 and speaking to Amendment 255. In doing so, I declare my interest as chairman of Peers for Gambling Reform.
Gambling in the UK is worth £15 billion a year and with it comes gambling harm, which is a major problem in our country. It is worth reflecting that over half of the gambling industry’s profits comes from those already suffering harm from gambling. Official statistics show that millions of people, including a horrifying number of children, are impacted by gambling. The Department of Health says that there could be more than one gambling-related suicide a day. Gambling advertising, marketing and sponsorship encourage more gambling, more profit for operators and more gambling-related harm. It is a serious public health issue.
The previous Government’s White Paper on gambling included no meaningful measures to address it. Nothing was offered to tackle the relentless bombardment of gambling messages, costing the industry over £1.5 billion a year, which has grown exponentially since the liberalisation of advertising in the Gambling Act 2005.
Speaking from the Dispatch Box just a couple of years ago, the noble Lord, Lord True, said:
“My personal view, as a sports fan, is that I am sick and tired of gambling advertising being thrust down viewers’ throats”.—[Official Report, 27/1/22; col. 446.]
His view is supported by a huge percentage of the population, including football fans, over half of whom believe that all gambling advertising, marketing and sponsorship should be banned.
Research evidence backs the call for action. A group of academics recently highlighted the unprecedented number of young people being exposed to gambling adverts. They concluded:
“it has become quite clear that the gambling products being offered and the ways in which they are promoted are harmful to individual and family health and damaging to national life”.
Despite proposing no action, the White Paper itself even acknowledged that gambling marketing can encourage people to start gambling, to gamble more, or to resume gambling after stopping.
Of particular worry is the entrenched link between gambling and football. It has raised concerns about not only the welfare of fans—especially the younger ones, who I will come to in a minute—but the opportunities for match fixing and corruption. Though rare, such incidents serve as a stark reminder of the risk posed by financial incentives tied to betting. It must surely be questionable that some of English football’s gambling sponsors do not even operate here. For example, Nottingham Forest’s primary shirt sponsor this season is a gambling operator that targets customers in China, where gambling is illegal. Surely that sort of thing should not be allowed.
Again, of particular concern is the way young and impressionable fans, who idolise players and clubs, are inundated with gambling logos. These are emblazoned on kits, around stadia and in programmes—as well as on TV, radio and online. It has normalised the idea of betting and makes it seem like a harmless activity.
Baroness Bennett of Manor Castle (GP)
My Lords, it is a great pleasure to follow the noble Lord, Lord Foster. I commend him on his leadership of Peers for Gambling Reform, of which I am a member. I apologise that I have not taken part at Second Reading and earlier parts of Committee. The Bill was being covered for the Green group by my noble friend Lady Jones. I am pleased to share with your Lordships’ House that her hip operation on Friday went very well and she should be back soon after Christmas. In the meantime, noble Lords get me instead.
The noble Lord, Lord Foster, has outlined the arguments, which I think are unassailable, for both amendments. I am particularly taken with Amendment 255, to prevent gambling advertising and sponsorship in football, because that will take us to where we need to go.
I declare a recent meeting with the group Gambling with Lives, particularly Liz and Charles Ritchie, who were bereaved following the gambling suicide of their son Jack in 2017. As the noble Lord, Lord Foster, said, we are seeing increasingly awful levels of harm, particularly among young people. There has been a doubling of the number of young people aged 11 to 17 with problem gambling, and 44 % of people who exhibit problem gambling are at high risk of thinking about suicide.
It struck me, listening to the Committee earlier today, that a phrase was used a great deal: fans are the lifeblood of the sport. Surely that is an illustration of the fact that the health of fans should be a matter of great concern to football clubs. The Lancet commission on gambling declared very explicitly only a month or so back that gambling has to be treated as a public health problem, and public health solutions are needed. That means protecting people from the gambling messages bombarding them.
I will quote a couple of statistics from 2021-22. There may have been a slight improvement since then, but not very much. During a single televised match, 3,500 gambling logos can appear. On “Match of the Day”, a gambling brand was visible up to 89% of the time. This can be described only as a bombardment and, as the noble Lord said, the consultation very clearly showed the views of fans.
We have also seen real progress from the Big Step campaign, which has been commended and is another illustration that campaigning works. But people are having to devote their lives to this cause, because the Government and the clubs are not doing the right thing. This, surely, is a place where the Government should step in to act.
Baroness Fox of Buckley (Non-Afl)
My Lords, the noble Lord, Lord Foster, and the noble Baroness, Lady Bennett of Manor Castle, will be unsurprised to know that I oppose these two amendments, which I will do briefly.
If the gambling industry is pouring money into football, I would say that that is a good thing. Anti-gambling commentators talk as if this were drug money coming from the Mafia. The whole tone is moralistic. We have already heard mention of match-fixing and cheating, as though it is all incredibly sordid and terrible. But let me just remind the Committee that betting firms are legitimate businesses. What, so they use their sponsorship to increase their market share—what is wrong with that? Is all football sponsorship beyond gambling to be forced to pass an ethics test—some kind of purity test? This is football, not some puritan revival movement.
Let us be honest: lots of football clubs need and appreciate this sponsorship money. It is all well and good that the Premier League has collectively agreed to withdraw gambling sponsorship from the front of clubs’ match-day shirts. That is a voluntary measure—it is up to it—but the truth is that, as we have ascertained in these debates, the Premier League can afford such lucrative virtue signalling, as I consider it. For the lower-tier and lower-league clubs and for the EFL, however, such sponsorship money is often invaluable. The Bill aims to help clubs become more financially sustainable, so the last thing it needs is external parties or legislators turning off one financial tap. This would mean that some cash-strapped clubs would face ruin if deprived of such revenue.
The Bill has been put forward in the name of fans and, whatever my reservations, I do not doubt that people have the fans at the heart of their discussions, whichever side they are on. But I remind noble Lords that millions of fans are less bothered about what logo appears on a player’s shirt or on advertising boards than they are about the quality on the pitch. There is more than a whiff of nanny state when they are patronisingly told by anti-gambling advocates that the ban would be for their own protection. It seems that anti-gambling campaigners do not trust fans to make their own decisions and make the right judgments about how they spend their own money.
Writing on this issue, Jon Bryan—who is an excellent commentator on the whole issue of gambling, which he posits and reminds us is a pleasurable leisure activity—says that it also undermines any notion of fans’ agency. The notion is put forward that, as soon as fans see a logo on a football shirt, they will rush off and place a bet, as though they are being groomed and just one punt away from addiction. This treats adult fans as children, and it is infantilising. It is often posed—
Lord Watson of Invergowrie (Lab)
On that last point, is the noble Baroness aware of the amount of in-game gambling that takes place through television and, of course, mobile phones, where the betting companies encourage fans watching matches to bet during the game on who will get the next corner, whether somebody be sent off, whether there will there be extra time in a cup tie and so on? Is that not interfering with the normal cut and thrust of the game in a way that is potentially dangerous, not least—I would like her to answer this point—to young people, particularly children?
Baroness Fox of Buckley (Non-Afl)
First, I would make a distinction between children and adults. Secondly, as somebody who is from a large, football-obsessed family, I am more than a little aware of all the encouragement that football fans have to put on a bet. But not all of them do when they are encouraged and, what is more, even if they do, they do not necessarily become problem gamblers, which is what is being posited. It can be something that they enjoy.
Lord Foster of Bath (LD)
This is not a case of me positing anything—I hope the noble Baroness accepts that. The figures I quoted are from the Gambling Commission and the Government.
Baroness Fox of Buckley (Non-Afl)
I have some figures, but I wanted to put forward a counter to these amendments without going into the details. I have spoken on this on many occasions in this House and I have written about it. I have figures, and we can swap our statistics. But I wanted to argue that it is proposed that allowing advertising of any sort around football, and allowing gambling to be associated with it, normalises gambling—but that is a slightly odd argument because gambling is a normal activity. The vast majority of people who put a bet on do so without a problem: it is part of their private leisure pursuits, which they enjoy. It is completely within the realms of spending money that they probably should not spend—it is Christmas and I have done a lot of that over the last few days when shopping. One makes choices and spends money that one probably should not spend, but it does not have to be turned into some kind of problem. It is our choice, and there should be some perspective about the threat.
The Gambling Commission does not give credence to the idea that gambling problems are completely out of control. Despite a lot of noise and rhetoric, there is no evidence that there has been an overwhelming increase in problem gambling since advertising was made legal by none other than Tony Blair’s Government in 2007.
Lord Goddard of Stockport (LD)
I do not disagree with the noble Baroness’s principles or beliefs when she talks about the nanny state and it being up to individuals, but where does she sit on smoking? Smoking was acceptable and everybody smoked, and sponsorship in sport was rife, with motor racing teams and darts competitions named after cigarettes. People do not smoke any more; society has changed. Unless you take positive action, you do not get that change. There is nobody in this Chamber now smoking; there is nobody in the hospitals smoking; there is nobody inside or outside football grounds smoking. That is a great thing. It is called taking responsibility for society. I wonder what the cost of gambling is to the NHS and the various other bodies that have to pick up the pieces of our individual choices and liberties. Those liberties are your own until they affect me and you, and him and her, and the NHS; it then becomes my responsibility to say something about it.
Baroness Fox of Buckley (Non-Afl)
I was on my last sentence, but I will now make it two sentences.
The noble Lord says that nobody is smoking now. It happens to be the evening of the Terrace Club’s Christmas bash. That is the House of Lords smokers’ group, and I can assure the noble Lord there are quite a lot of them smoking, cross-party, including from his own party. They are drinking and smoking, and every party is represented. It is in the hut round the back, by the way, in case anyone wants to pop out. There are quite a lot of people who smoke still.
Smoking advertising was taken out of sports, and a number of sports nearly collapsed—darts and snooker had a real problem. The funny thing is, guess who came in to save them? The gambling companies came in and saved those working-class, grass-roots, rank-and-file sports. Good on them, I say. The working classes were grateful at the time, and they did not all become problem gamblers as a consequence. They enjoyed the sport.
Baroness Brady (Con)
My Lords, these amendments seek to address gambling sponsorship in football, and include proposals to ban sponsorship entirely. This is a significant issue. I acknowledge the genuine concerns that many have, including the noble Lord, Lord Foster, about the role of gambling in sport. However, I would like to provide some context and explain why I believe that further interventions in this area are not required at this time.
The Gambling Act review has recently and comprehensively considered the role of gambling sponsorship across all sports, including football. The Government’s response reflects the extensive engagement and evidence gathered during that process. As part of this, the Premier League has already taken significant, proactive, voluntary steps to address concerns, demonstrating its commitment to act responsibly.
Most recently, the Premier League and its clubs have led the way, not just within football but across all sports, by taking the voluntary step to move away from gambling sponsorship on the front of shirts. This was a key ask made of us by the DCMS, and we agreed. This is a significant decision, and one that I do not believe any other major sports organisations have taken.
The impact of this step on clubs is, frankly, quite painful. Contrary to what the noble Baroness, Lady Fox, said, most clubs cannot afford to do it, but they have done it anyway because they have been asked to. The typical difference between gambling and non-gambling shirt sponsorships is around 40%. For some Premier League clubs, this decision will mean a reduction of around 20% of their total commercial revenues. For clubs in the bottom half of the Premier League table or those newly promoted, the financial hit will be especially pronounced in the short term, and comes on top of the £250 million hit to Premier League clubs over the Parliament, as I have already mentioned in this Committee, following the Budget’s rise in employer national insurance contributions. The pressures are acute, but the Premier League clubs took this decision, fully aware of the difficult commercial consequences, because it was the right thing to do and was aligned with what the Government asked of us.
Furthermore, the Premier League has led the way in driving forward the development of an all-sports code of conduct, published earlier this year. This sets out standards on gambling partnerships, including the critical issue of awareness and responsible gambling messages, that all clubs and sports organisations will adhere to. The code reflects the seriousness with which football in particular is addressing this issue, and provides a strengthened framework for responsible engagement with the gambling sector.
It is important to acknowledge the vital role that gambling sponsorship plays in supporting clubs across the football pyramid. For many clubs, particularly those outside the Premier League, gambling sponsorship represents a significant source of revenue. That is the reality we all need to be conscious of, especially in the context of the Bill, which focuses on financial sustainability. Noble Lords may be aware that the EFL has a much greater reliance on gambling sponsorship, including its title sponsorship deal with Sky Bet. The Premier League itself has never had a gambling sponsor. This demonstrates that the issue is not uniform across football and that heavy-handed interventions may well risk disproportionately affecting clubs lower down the pyramid.
The Premier League’s voluntary decision to phase out gambling on front-of-shirt sponsorship is just one major step, but it is proof that football is taking this issue seriously. It shows that football can lead the way on responsible change, even when it causes difficulties for clubs, without the need for heavy-handed interventions. We must properly address concerns about problem gambling and the need for responsible behaviour and stringent regulations. Football must clearly be part of the solution, as it wants to be, just as all sport needs to act responsibly. However, I argue that the Premier League in particular has already shown important leadership here, taking proactive and voluntary steps that, as far as I am aware, no comparable organisation has yet replicated.
In the light of the progress already made, I respectfully suggest that football does not require further statutory intervention in this area. We have shown—but of course we must collectively continue to show—that we can be relied upon to make progress on this vital issue.
Lord Parkinson of Whitley Bay (Con)
My Lords, I am very grateful to the noble Lord, Lord Foster of Bath, for his vigilance on this topic, as he always showed when I stood at the Dispatch Box opposite. I know he will be particularly vigilant as the Minister holds the responsibility for gambling. I am sure that she will be glad to have the chance to talk about something directly in her portfolio, in addition to the work that she has been doing on the Bill.
I am pleased to hear that the hip operation of the noble Baroness, Lady Jones of Moulsecoomb, went well, and even more pleased that she missed my disobliging comments about Arsenal this evening. That is the team she supports, so it is probably just as well that she was not here to hear them.
Of the two amendments of the noble Lord, Lord Foster, I am more taken with Amendment 143, which seeks to require football clubs to consult their fans on gambling advertising and sponsorship. I am mindful of the example of Wonga, a payday loan company rather than a gambling firm, and Newcastle United. It was an important reminder of the discomfort that fans feel when they are forced to wear the logo of companies and others of which they might not approve when they buy the football strips of the team they support.
Engaging fans on sponsorship is worth while, particularly where the companies are ones about which clubs know that fans have views. The noble Lord set out the growing concerns about the prevalence of gambling in sport and its potential to influence fans, particularly younger and more vulnerable groups. If we can strike a better balance between the immediate commercial needs of clubs and the long-term interests of the fans who support them then that is worthy of our consideration.
I am struck too by the points that my noble friends and others have raised about the importance of sponsorship deals on the finances of football clubs—particularly those in the lower leagues—to maintain their financial stability, which is such an important point underlying the Bill. Although Amendment 143 has much to commend it, the consultation must be a genuine and two-way conversation between clubs and fans to address the importance of investment in the sport and the good work that many are doing.
The second amendment in the name of the noble Lord, Lord Foster, Amendment 255, seeks to prevent regulated clubs and competitions promoting or engaging in gambling advertising or sponsorship altogether. In doing so, it rather overrides the open-minded consultation of his first amendment. I think this goes too far: an outright ban on gambling advertising and sponsorship would, in my view, be too blunt an instrument for addressing the complex issue of gambling and the broader questions of sponsorship in football.
I am grateful to the noble Lord for tabling both amendments and the fact that we can consider them side by side in this group. I look forward to hearing what the Gambling Minister has to say about them.
Lord Addington (LD)
My Lords, I totally agree with my noble friend on this one—both noble friends, actually. I am afraid that if you want to see a country where gambling advertising and gambling problems are linked, you just have to look at Kenya—especially at the young. There is a chronic problem there, and it is doing enormous damage. Football has enormous reach and enormous power; it will reach out to you, and it reaches out to the most impressionable. I hope that the Government take some action here, showing a way forward that at least reduces the harm.
I know that the noble Baroness, Lady Brady, means well with her point about the front of the jersey, but it is a team game. People run up and down; the back is still there.
The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)
I thank the noble Lord, Lord Foster, for these amendments. As Gambling Minister, I acknowledge the importance of monitoring the impacts of gambling sponsorship in football. Slightly bizarrely, I think this is the first opportunity I have had to discuss gambling in your Lordships’ House. I am confident, from working through the measures in the White Paper, that it will not be the last, but I acknowledge the noble Lord’s long record of campaigning on the issue of gambling harm.
I also thank the noble Baroness, Lady Bennett of Manor Castle, and join others across your Lordships’ House in wishing the noble Baroness, Lady Jones of Moulsecoomb, a speedy and good recovery. We look forward to the noble Baroness working with us while the noble Baroness, Lady Jones, is recovering from her operation.
Starting with Amendment 255, the Government do not believe the regulator should have a role in commercial matters such as sponsorship. This is outside the scope of the regulator and commercial decisions are, rightly, decisions for clubs. Further, what constitutes the promotion of gambling could be interpreted extremely widely, with significant consequences for clubs and the sport more widely. This might mean players not being able to take part in competitions that have gambling sponsors.
All major football bodies have published their joint gambling sponsorship code of conduct, which sets minimum standards for socially responsible gambling sponsorships within football. The Government will closely monitor the implementation of the codes of conduct to ensure they have a meaningful impact. I note the points made by the noble Lord, Lord Foster, about children and young people. I am happy to liaise with him and other noble Lords on this further as the codes of conduct are implemented.
On Amendment 143, I agree that where gambling advertising and sponsorship appear, it must be in a socially responsible way. Both the noble Lord, Lord Foster, and the noble Baroness, Lady Brady, mentioned that the Premier League has already made a decision to ban front-of-shirt sponsorship by gambling firms by the end of next season. That is welcome. The noble Lord, Lord Foster, referred to around 40 clubs that have already taken action on gambling sponsorship. As I set out in my speech at the GambleAware conference on 4 December, I really want to see the gambling industry further raise standards to ensure that levels of gambling advertising do not exacerbate harm.
I apologise to the noble Lord if my response to his question was not clear. We are trying to address volume across different companies, where even if one company has only a small amount, the collective volume can become quite significant. That is a specific issue we have asked the gambling industry to look at. Where there is volume across the piece, individually it might not be excessive but together it might represent a significant amount of gambling advertising beyond what is deemed acceptable. This work will be monitored closely.
Lord Foster of Bath (LD)
My Lords, it has been a short but interesting debate that has raised many issues. I do not think now is the time for me to go through them all. Suffice it for me to say that the noble Baroness, Lady Fox, basically said that gambling is a matter of personal choice. That is a view she is entitled to take. The vast majority of people have come to the view that gambling, like alcohol, tobacco and drugs, is a public health issue. That means there is a need for a degree of intervention in that activity. I, and Peers for Gambling Reform, have been debating what the level of that intervention should be.
I am certain that gambling advertising, marketing and sponsorship lead to more harm in this country. We know that there is more than one gambling-related suicide every single day, and that should be of deep concern to us all. Collectively, we need to take more action than is currently being taken. That is why I hope we will have the opportunity to bring amendments such as this back at a later stage and to continue the debate then. At this stage, I beg leave to withdraw the amendment.
(f) the club’s political statements and positions.”
Lord Parkinson of Whitley Bay (Con)
My Lords, my Amendment 145 seeks to add to Schedule 4 a consideration of a
“club’s political statements and positions”
in the part of the new regime that concerns the fan engagement threshold requirement. I and my noble friend Lord Markham, who has added his name to the amendment, have sought to do this in as neutral a way as possible, reflecting the fact that political statements and positions are rarely one-sided. They are usually complex matters with a number of competing and conflicting views.
We have seen in recent weeks the case of Crystal Palace’s Marc Guéhi, who twice amended his rainbow-coloured captain’s armband with expressions of his Christian faith. Plenty of people would say that rainbow armbands supporting gay rights and written expressions of Christian faith are not irreconcilable things. The problem in his case is that his expression of his religious faith fell foul of FIFA and FA regulations banning
“any political, religious, or personal slogans, statements or images”
on players’ kit or equipment, while the other was deemed an acceptable form of political expression.
During the last World Cup in Qatar, we saw the great dismay among LGBT+ fans when the FA chose to suspend its advocacy on their behalf while the tournament was taking place in Qatar. I am very proud that my right honourable friend Stuart Andrew, the former Sports Minister and now the shadow Secretary of State, wore the one love armband—which a number of fans and others were very keen to see worn—when he went to cheer our national teams on in the World Cup. Although, as a Welsh-born man representing an English constituency, I think he found it just as difficult having to reconcile deciding for whom to cheer in the England v Wales match that he saw.
We have seen many other examples of this being a growing area of concern for fans, clubs and those who have to navigate these choppy waters. Whether it is taking the knee, the decision about when to hold a minute’s silence and over what, the singing of certain anthems and songs or the decision to light certain stadia up in yellow and blue in support of Ukraine but not white and blue in support of Israel after 7 October, these are very difficult matters for clubs to decide. They should be able to decide them for themselves, but the amendment my noble friend and I have brought forward asks them to discuss these matters with their fans, to try to take on board their views, to take them with them and indeed to encourage them to think about these matters and perhaps change their mind.
In doing so, the amendment asks the Government to recognise that religious or philosophical belief is itself a protected characteristic under the Equality Act 2010, so is worthy of our consideration when we are looking at supporting diversity in football, and that diversity of thought is really important if we are to grapple with these very thorny questions as a society.
The amendment also seeks to ensure that football clubs remain genuinely independent and free from external political pressure that might distort the relationship between them and their supporters. If we are to safeguard the integrity of football as an independent sport, we cannot allow it to be co-opted into political campaigns, whether from the Government or from any other political group. The duty to consult fans on political statements and activities is a safeguard which ensures that clubs will remain true to their roots, focused on the sport and not caught up in advancing political crusades or day-to-day rows.
I hope Minister will look at our amendment with the neutral consideration we have tried to give it in the way we have worded it. I beg to move.
Lord Jackson of Peterborough (Con)
My Lords, I rise to speak to my Amendment 244 and to support Amendment 145, moved by my noble friend Lord Parkinson of Whitley Bay. My amendment seeks to formalise a duty which will prevent clubs, players and employees of clubs publishing political statements that bring division and conflict into a game that should be about generating unity.
We have seen over previous years multiple instances of virtue signalling, such as taking the knee before matches after the Black Lives Matter protests, and the wearing of certain armbands—as my noble friend has said—and laces, which are the latest attempt to campaign. I would say that it is a small “p” political campaign. I may differ somewhat from my noble friend Lord Hayward on this, so it is probably a good thing that he is not in his usual place.
Politics is not just about party politics. It is about the pernicious influence of political campaigning affecting—infecting—football, our national game. I remember the dark days of the 1970s, when a number of London clubs were perceived to be involved with the rise of the National Front and its racist politics. That gave rise, of course, to instances of football hooliganism. That was not a party-political issue, but it was a political issue. We do not want to go back to those dark days when, for instance, Millwall was associated with football hooliganism and some elements of racist behaviour.
I am not even sure that these initiatives work. The figures quoted a week or so ago in Committee show that 43% of players in the Premier League are Afro-Caribbean or Black African. They have achieved that through their skills, their abilities, their resilience and their physical fitness, not because they wore multi-coloured boot laces. UEFA already bans political statements such as these, but it has not been successful in implementing and enforcing such rules. The Government could really take a lead on that.
If the Government are so keen to have a regulator to enforce numerous other rules, many of which overlap UEFA’s rules, surely it is only right that the regulator impose rules on political statements and attempts to impose political views. My noble friend is quite right: we have seen recently the unpleasant behaviour of fans cheering on pro-Palestinian extremists; and of course, we have the ongoing debate, discussion and rivalry between Celtic and Rangers in Glasgow. That is very much a political issue.
Article 16 of UEFA’s own regulations, entitled “Order and Security at UEFA Competition Matches,” prohibits
“the use of gestures, words, objects, or any other means to transmit a provocative message that is not fit for a sports event, particularly provocative messages that are of political, ideological, religious or offensive nature.”
My own bugbear is bad language, particularly in front of children and young people. It is terrible, unacceptable, for grown men to be swearing and using really unpleasant language. However, do we really want to add into that mix the poisonous disputes of politics and political issues? I do not think we do.
Why do we not try to replicate, and perhaps enforce, UEFA’s rules in the Bill? We must remember how divisive such actions have been with supporters and fans. No one likes to be told what they should believe or how they should act. Fans themselves are diverse; they do not need to have these views forced down their throats—such as the preachy proselytising of Gary Lineker on any number of fashionable so-called progressive causes, or a pretentious new Jaguar advert which does not actually feature a Jaguar car.
Fans want to watch a football match and support a team; they do not want to be in the middle of a political bunfight. Fans turn up to watch their favourite team play, not to see a session of Parliament. For those reasons, the Minister should give consideration to this amendment. It would save us from further discord and conflict, which we do not need. Fundamentally, we have to trust the clubs themselves to do the right thing by their fans, their players and their boards and deliver good policies organically, rather than enforcing these kinds of initiatives, which have been proven not to work necessarily.
Lord Moynihan (Con)
My Lords, I agree with the noble Lord, Lord Jackson. What he said was exceptionally perceptive and wise. Look at Marcus Rashford, for example, who exploded on to the football scene in the UK in 2016, aged just 18, and scored on his Manchester United and England debuts, before becoming one of the country’s most exciting prospects. He became a household name at the same time and was recognised with an MBE for his work off the field, campaigning on child hunger, which he faced growing up in Wythenshawe in Manchester. He challenged the then Government in 2020, imploring Ministers to offer free meals to needy children in the school holidays.
The position for international sports federations—and, indeed, for clubs in this country—is to recognise that a balance needs to be struck, which is what my noble friend Lord Parkinson was arguing for. The balance to be struck in the Olympic movement is recognising that the IOC Athletes’ Commission opposes using athletes for political propaganda or campaigns, while providing the opportunity for them to exercise their views and opinions in official media settings or on social media accounts, which are so powerful. Surely this is not a subject for the regulator; this is a subject for clubs and the organisers of the competitions in which they play.
Lord Addington (LD)
My Lords, I make a brief reminder here that objections have been raised to all sorts of things. I remember when it was the poppy on jerseys in a football match. Apparently, a political statement is one that you either do not understand or do not agree with. I ask the Government, and indeed all noble Lords, to be very careful about this. These amendments are trying to exclude things that might be positive and good, because there will always be somebody who disagrees with them. All I will say is: tread very carefully here. Remembering the dead of World War I and World War II would not be seen as an overt statement in this country, but apparently it is elsewhere.
Baroness Fox of Buckley (Non-Afl)
My Lords, very briefly, I am so glad that these amendments were tabled, because it gives us a chance to reflect. The statement that to determine what is right and wrong between different countries and cultures is very complicated so it is easier to say that it has no place in the game seems fair enough to me. Politics is complicated. We find it complicated in this place, even though we are the legislators and the politicians. Once you start introducing it into football, you can get into a real mess.
I am also not sure about a few things, so I want to share some confusion. One difficulty is that, for example, we heard from the noble Lord, Lord Hayward, last week that he does not consider the rainbow armband to be political, but I think that it is highly ideological and political. Last month, the FA dedicated a 35-minute video to the Rainbow Laces campaign, showcasing an activist-heavy panel that included its women’s talent and senior game EDI consultant coach developer. That title gives the game away before we go anywhere.
Guess what? That particular individual used to work for Stonewall before being brought into football. I hope that we in this House understand that Stonewall is at least a highly contentious political organisation which is now at the heart of defining what is considered to be inclusive football. The problem with this profusion of rainbows on laces, pitch flags, ball plinths and all the rest of this branding is that any objection on the basis of politics leads to an accusation of being insensitive to lesbian and gay people or being homophobic. Indeed, it is the very opposite. I think that trans ideology is discriminatory against lesbians and gays because it does not understand same-sex attraction. If noble Lords are lost and are thinking, “Oh God, what is she going on about?”, that is fine. It is a political matter and nothing to do with football. I worry when football managers and teams get embroiled in this.
I was unsure about this amendment. I am usually the kind of populist democrat who says, “Vote on everything; go and have a vote”, but I did wonder when the noble Lord said, “See what the fans say—don’t put out a statement unless they agree with you”. Maybe it is because I am from a Celtic family—although some of them support Spurs. I hope that noble Lords can get their heads around this. Celtic’s fan base has gone completely bonkers on the Israel-Gaza question. It is like a Hamas support group on tour. The irony is that their sloganeering in support, as they would see it, of the Green Brigade and all the rest of it—their support for Gaza resistance—has put them completely at odds with Celtic’s owners and the board, although the Celtic Trust, the shareholders’ group, agrees with them. It has split the club. But everyone should keep out of this. Let them sloganise away, but do not get involved one way or another. Make the political point.
However, I cheered when Crystal Palace put out an official statement after the 7 October pogrom. I thought it was great that at last somebody had come out and condemned the murders and hostage-taking. We have seen what has happened to Israeli teams, which have been subjected to anti-Semitic attacks, one of which almost brought down a Government on the continent. We know what is going on. I am interested that football is getting involved in this. I have already commended those Spurs fans who have started a grass-roots campaign in support of Emily Damari, the last remaining British hostage. I want Spurs fans to chant this young woman’s name at the ground. Her uncle Rob is a Crystal Palace fan. As he pointed out, they may not have the grass-roots campaign, but at least Palace put out a statement.
I am into all this. I genuinely do not want to say that we should sanitise football clubs of all political discussion. It is impossible. It is not going to happen. I do not want the Government interfering in it or a regulator being involved. I do not want people being in a situation where they fail, or refuse, to acknowledge that they are putting forward, for example, EDI policies. These are politics in disguise, although they will not admit it. Politics is complicated. Let us keep it out of football. The fans will be political just because they are stroppy like that.
Baroness Twycross (Lab)
I thank the noble Lords, Lord Jackson of Peterborough and Lord Parkinson of Whitley Bay, for tabling these amendments, and all noble Lords who have contributed to the debate. These amendments seek to add a requirement for a club to consult fans on any political statements or stances.
Amendment 244 in the name of the noble Lord, Lord Jackson of Peterborough, would additionally mandate fan approval of any political statement or political activity made by the club, its players or any other staff. This includes fan approval in relation to the issuing or wearing of items of clothing with political connotations. As the noble Baroness, Lady Fox of Buckley, outlined, what we view as political is disputed. It is not the place of a statutory regulator tasked with sustaining the stability of the game to limit or add approval processes for political speech or action or, indeed, to determine what is defined as political in the first place.
On Amendment 145, tabled by the noble Lord, Lord Parkinson, clubs may wish to consult their fans in this regard as part of their regular fan engagement. However, this is not something that the regulator will require of clubs. The Bill is intended to ensure that fans have a voice in key decisions regarding their club, but we need to make sure that this is proportionate. That is why we have not listed every possible issue that clubs should engage with their fans on in minute detail.
As has been mentioned, it is notable that many sporting personalities have used the attention that sports receive to campaign on issues that concern them. The noble Lord, Lord Moynihan, highlighted Marcus Rashford as an example. To be clear, we do not want to inhibit free speech. Instead, as is the case now, fans are equally able to use their own freedom of expression to protest political statements or actions made by their club. As well as potentially constraining freedom of speech, these amendments would not improve the regulator’s ability to deliver its objectives. I therefore ask the noble Lord to withdraw his amendment.
Lord Parkinson of Whitley Bay (Con)
I am grateful to the Minister and to all noble Lords who have spoken on this group for their considered thoughts. Like the Minister, we do not want to inhibit free speech. The difficulty is in questions of an acceptable political gesture or article of clothing conflicting with the free speech of those who take a differing view. That is where it is important for clubs to be mindful of the wide range of views that are out there and to have an earnest conversation with their fans and with society more broadly.
The noble Lord, Lord Addington, is right to mention the poppy. Sadly, it is already an article contested by some—we have crossed the Rubicon that he warned us to be wary of. The noble Baroness, Lady Fox, alluded to the sectarianism that there has been for a long time in certain football clubs. This is not a new matter but one which is growing and where there are new, more complicated areas of contention. I agree with the sentiment that a number of noble Lords expressed that it is important to get politics out of football.
I hope that the Minister will reflect further on this ahead of Report. I am grateful to noble Lords for their thoughts and beg leave to withdraw my amendment.
Lord Parkinson of Whitley Bay (Con)
My Lords, I rise to move my Amendment 146 and speak to my Amendment 237. I am grateful to the noble Lord, Lord Addington, for adding his name to them. These amendments are identical in nature, seeking to change “crest” to “badge” in the two instances where it is used in the Bill. These were the first amendments that I tabled on this Bill. They are short and simple but very important.
I appreciate that heraldic terms can seem confusing to the uninitiated, but if we cannot get this right in your Lordships’ House, where all Members are armigerous, where can we? It might be helpful to start with a brief glossary. A full heraldic achievement consists of many elements. The most common and obvious of these is the shield or escutcheon. On these, or on a diamond-shaped lozenge for women, is borne the coat of arms, the design of which is particular to the person or institution which bears them. We are surrounded by many splendid examples of these in your Lordships’ Chamber. Noble Lords might have found their eyes hovering over them from time to time during some of our longer debates, as mine sometimes do. If noble Lords’ eyes start to wander during the debate on this group, I will take that as a sign of focus rather than distraction.
Sadly, the stained-glass windows which were designed for your Lordships’ Chamber by Augustus Pugin were lost during the Second World War. The replacements installed in 1950, sadly not illuminated now because of the late hour, show the coats of arms of Peers who lived between 1360 and 1900. The armorial bearings running beneath the Galleries are of various sovereigns from Edward III and Lord Chancellors from 1377 onwards.
What first catches the eye when it drifts in our debates is the escutcheon bearing the coat of arms, but other elements can be seen. As Peers, we are entitled to supporters—figures or objects placed either side of a shield; very often these are animals, real or imaginary, such as the lion and unicorn in the royal coat of arms, but they can be figures as well. My late noble friend Lady Thatcher, for instance, had as supporters an admiral of the Royal Navy to commemorate the victory in the Falklands War during her celebrated premiership and Sir Isaac Newton, who, like her, was born in Lincolnshire, in recognition of her earlier career as a scientist.
Lord Moynihan (Con)
My Lords, in the interests of the noble Baroness, Lady Blake of Leeds, the noble Lord, Lord Mann, and me—passionate Leeds supporters—I feel that my noble friend Lord Parkinson seems to have made an error. The first Leeds United badge, which actually began life in 1908, 11 years before the formation of the club we know and love today, was originally used by Leeds City Football Club—the team that preceded Leeds United. It was based on the coat of arms of the city of Leeds and it featured three owls. In some variations, it included the Latin motto “pro rege et lege”, which translates as “for the king and the law”. The team colours, blue and yellow, also came from the city’s crest. In 1965, came the owl badge. It was considered by some to be more representative of the team known as the Owls, Sheffield Wednesday—which my noble friend did not mention; he mentioned only Sheffield United—than of Leeds United FC, despite three owls featuring on the crest of the city of Leeds. The badge would have donned the shirt of a little-known youngster by the name of Billy Bremner.
On behalf of the noble Baroness, Lady Blake of Leeds, the noble Lord, Lord Mann, who is sadly not in his seat, and me, and taking only one minute of the Committee’s time, I needed to correct my noble friend Lord Parkinson on his lack of knowledge of this rather important issue of a recognised badge for Leeds United.
Lord Parkinson of Whitley Bay (Con)
My point was that the 25 badges and clubs that I listed are those which have been granted through delegation by the College of Arms to the English Football League. There are many splendid but unofficial badges used by teams elsewhere in football.
Lord Addington (LD)
I will take that advice.
I put my name to Amendment 237, because I thought that it was about an identification symbol. That is what heraldry is all about, except that we do not use it any more to define who is going to belt who over the head in the middle of a medieval battlefield. All I can say after listening to the speech on this amendment is that I have learned much, but I am not sure when it will be useful.
Baroness Twycross (Lab)
My Lords, I am very grateful to the noble Lord, Lord Parkinson of Whitley Bay, for these amendments, which address changes to club heritage assets and what should be safeguarded by the regulator. I if may say so, this debate could be used as the definition of a lordly debate.
The Government understand that the amendments in the name of the noble Lord seek to avoid a misuse of any heraldic terms. I am grateful for the historic background that he gave in what was one of the Committee’s more unusual contributions, but one from which we all learned a great deal.
This specific clause is intended to work in tandem with the FA heritage protections, with the regulator acting as an enforcement backstop to the FA’s rules. The FA’s heritage protections use the term “crest”, and therefore this amendment would risk the regulator being out of step with the rest of the industry. However, I stress to the noble Lord that officials have liaised with the College of Arms on this. We are keen to ensure that the Bill does not incorrectly signal that the regulator would ever override the separate process of the College of Arms. We have engaged and will continue to engage with the College of Arms to ensure that it is content. This may be something that we return to upon further discussions with the college and the FA. I acknowledge the intent of these amendments but, for the reasons that I have outlined, ask the noble Lord, Lord Parkinson, to withdraw his amendment.
Lord Parkinson of Whitley Bay (Con)
I am very grateful to the Minister for the way that she has engaged with this and her promise to look at it further. She is right that this is a very House of Lords issue, but I was alerted to it by comments on social media from those who watch your Lordships’ proceedings, so it is both an ancient and a very modern issue, and one about which people feel very strongly.
I am glad that the Minister has begun dialogue with the College of Arms. Just because others are getting it wrong, it does not mean that we should get it wrong in legislation. For the reasons that I have set out, I think that we can nudge towards the present legal position in the Bill. I am grateful to the Minister for that and will certainly take her up on the offer to discuss this further between now and Report.
In my research I was pleased to learn that a football first appeared in heraldry as far back as 1604, when the Clarenceux King of Arms at that time granted arms and a crest to Sir William Jordan, who was briefly a Member of Parliament for Westbury. Noble Lords may be as surprised as I was to learn that a football appears in the 17th century grant given to him. His crest is
“A football or encircled by a scroll inscribed PERCUSSA RESURGO”—
“Struck, I bounce back”. That message of resilience is perhaps one to cheer us on as we consider these amendments in Committee. I beg leave to withdraw my amendment.
Baroness Fox of Buckley
Baroness Fox of Buckley (Non-Afl)
My Lords, I asked for this amendment to be degrouped because I wanted to ensure that the issue of equality, diversity and inclusion reporting was treated separately and as an important issue in its own right in the Bill. I thought that would mirror the way the Government have treated the same topic. I had problems with the original Bill that the Conservative Party introduced when in government. I was ready to oppose it, but in a fairly limited way. When the Bill came back with the new Government, things had been added. One of the announcements the Government made was of the importance of adding EDI—equality, diversity and inclusion—and that they were bolstering that in the Bill. I immediately became concerned. As we have all noticed, we have discussed it quite a lot already, but there is always more to say.
I want to establish something: it is admirable that corporations, institutions and football clubs are today keen to try to make themselves more welcoming places for minorities and for everyone. They should not employ any discriminatory practices that prevent people being able to participate equally—in this instance as fans, in employment or at any level of staff, management or players. The only thing that should matter is merit rather than prejudice; that should be the key principle. To be clear, my objection to the regulatory requirement for EDI reporting being added to the original Bill was not because EDI is some righteous vehicle for fairness in football governance but rather because EDI is a bureaucratic process—I would even say a bit of a virtue-signalling racket. It is expensive, ineffective and often counterproductive, and it opens the door to political interference by the state in football, something that a number of us are worried about.
On effectiveness, I remind the Committee that the Post Office won awards for its diversity and inclusion policies. The Post Office also had a modern slavery statement, a carbon reduction plan and a very worthy statement of corporate social responsibility. All the while, senior management at that same Post Office allowed its own sub-postmasters to be treated in the most inhumane, unfair and possibly unlawful manner. You can tick all the good governance boxes in the world and have award-winning EDI schemes on the books, but it does not equate to good governance.
To be less cynical, most employers mean well when they decide to implement EDI measures, but they can be so desperate to be seen to be doing the right thing that they rush into initiatives that do not work even on their own terms. Research by the Chartered Institute of Personnel and Development, the CIPD, has found a worrying number of business leaders who say that they did not do any research before launching their EDI schemes.
Talking of research, I urge the Minister to look at the government-commissioned report of the inclusion at work panel. It was convened by Kemi Badenoch when she was Equalities Minister and Business Secretary. In case that allows anyone to dismiss the report as some kind of biased Tory report, the panel comprised a range of private and public sector experts. It was advised on by a renowned Harvard University professor. It really is just research. The report concludes that EDI practices are often polarising and counterproductive, and can even be unlawful. For example, in pursuit of a more diverse workforce, overzealous employers have used so-called positive discrimination even though it is illegal under the Equality Act 2010. I am worried that this is the kind of thing that will happen in football.
I remind noble Lords of the case that I mentioned very briefly in the debate on an earlier group in relation to the Royal Air Force. In 2022, hoping to meet its diversity targets, it overlooked eminently qualified white applicants for female and ethnic-minority recruits. This was then found to be unlawful, and those candidates who were passed over received financial compensation.
I remind the Committee of the case of Linzi Smith, who was reported to the police, a victim of surveillance and barred by her beloved Newcastle United Football Club for holding legal views and expressing them, not at a football ground but on social media. Her football club and the Premier League have disciplined her, and she is now banned from attending football. It is an atrocious case.
I also draw attention to a compelling new study released by Rutgers University, which has found that EDI training often sows divisions and resentment in organisations, and that EDI practices can lead to perceptions of prejudice where none objectively exists. For example, it can happen when prioritising EDI schemes, then sending employers on endless training sessions and workshops, and telling them—depending on their race, sex, disability or whatever—that they are either victims or oppressors. Guess what: this fosters and exacerbates conflicts and resentments.
What is heralded as an effective solution to bigotry and prejudice seems instead to be fuelling the very problems that its advocates claim to want to solve. Therefore, I ask the Minister to pause and think before adding this to the Bill, to avoid opening up a hornet’s nest of division in football clubs.
After all I have said, we should not be surprised to discover that things are moving pretty quickly and we could be behind the times. In America, US corporates and organisations are now realising that what they call DEI rather than EDI is causing real problems; they are starting to realise that they should get out of it. Richard Lowry, editor-in-chief of the National Review, recently wrote that one of the most important events in America this year, outside the presidential election, was the intellectual collapse of what was described as the “DEI fad”.
The Wall Street Journal and various other American newspapers have noted some of this. Walmart, America’s largest private employer, is just the latest company to abandon DEI. It announced that, from 25 November, it was rolling back a slew of initiatives related to DEI. This has included winding down programmes providing assistance to suppliers that are 51% owned by women, minorities, veterans or members of the LGBTQ+ community. It is also phasing out the phrase “DEI” in its corporate messaging, and says that it will no longer give priority treatment to suppliers based on race or gender diversity.
According to the City Journal, Boeing, the aircraft manufacturer, has dismantled its global equality, diversity and inclusion department as it oversees a broad revamping of the company’s workforce. It is now emphasising hiring on merit, while truly caring for people, regardless of arbitrary one-dimensional identity or affinity group labels. It says that that is the way to go.
This is not just me going on about EDI; this is major corporates across the world, which have tried this stuff and said that it has been a disaster. You can also look at Harley Davidson, the car maker Ford, and the farming goods company tractor today. They have all rejected EDI goals, targets, report writing, quotas and so on. We have also seen consumer boycotts that have forced brands such as Bud Light and Target to retreat from EDI-inspired marketing campaigns. That seems to me to indicate that maybe a pause is required.
I now want to come back to football.
Baroness Fox of Buckley (Non-Afl)
I am glad that you agree.
Football can learn from other people; and, as we are importing EDI from the corporate sector and the university sector, we should see where it has been a disaster there before we impose it on football.
Most people in football, for obvious reasons, are not experts in EDI. You can imagine a situation where a football team is basically told that the regulator could punish them if they do not live up to the EDI requirements stipulated in the Bill. They will do what every organisation does in this situation. They will think, “We don’t know anything about critical race theory; we don’t know anything about decolonising; we don’t understand this stuff, so what should we do?” Of course, they outsource the work to the experts, who know. Third-party outsiders are brought in house. They are the kind of professionals who know all about EDI. Those professionals are not necessarily motivated by fair-minded, pragmatic goals. They are often activists: individuals or organisations committed to what I consider to be a political ideology—something like critical race theory. Look at how the diversity industry has wrought havoc on all levels of the public sector in this country: universities, museums, the Civil Service. This is a real source of contention. It does not matter what side you are on; it is causing divisions.
What began as an attempt to remove barriers for historically disadvantaged groups has grown into a thriving grievance industry. We have seen that one of the slogans of EDI is to bring your true, authentic self to work. My attitude is that you should leave it at home. The only thing you should bring to work is your professional self.
I commend the Secretary of State for Health, Wes Streeting, for making the point that your political views, if you are, for example, a hospital doctor, should stay at the door of the hospital. We are not interested in your true, authentic self. But of course, all the people are coming in and saying, “I have to express my true, authentic self as a doctor and tell you everything I have ever thought about Israel and Gaza”. That is out of EDI. That is where it came from. Your own Health Secretary has rather courageously pointed out that that that should be discouraged, if not disciplined.
This part of the Bill will oblige clubs to employ expensive pen-pushers with a particular expertise in writing reports, all because of the mandatory inclusion reports. These reports will not write themselves. We heard earlier from the noble Lord, Lord Maude, who is not in his place. He was talking about the challenges of writing complicated business plans. You have to get all the lawyers in. Let me tell you: to write an EDI report, you also have to learn a new language. It is a completely different world. They will be paying people to write this stuff.
It does not come cheap. The cash-strapped clubs facing financial strain—an issue we are keen to do something about—will now have to find the money to pay all these EDI directors. By the way, the assistant director of EDI community services in one local council was earning £103,000. These guys are not cheap. Which council was that person working for? Birmingham. It has gone bankrupt. This is what happens. You can waste money and your priorities can get completely distorted.
I do understand, by the way, that many football clubs have big EDI departments. The Premier League is like so many big well-endowed organisations and corporations, which very often have huge EDI sections—it is a growing industry. I disapprove of that, but that is up to them; I just do not want it to be regulated. But legally requiring smaller clubs to publish their inclusion strategies—explaining how their strategic plans will fulfil the EDI requirement, with annual equality reports and so on—seems to me to be taking their eye off what should be important. It inevitably steers organisations away from their actual purpose: winning games. Diversity training cannot become as important as football training. Encouraging clubs to demonstrate their EDI credentials could be an indulgent and dangerous distraction from what they should do and what they can do best.
Lord Jackson of Peterborough (Con)
I rise to support my noble friend Lady Fox of Buckley, and I was pleased to sign the amendment. Noble Lords should remember that the corporate governance statement is not a voluntary part of Schedule 5; it is a mandatory licence condition and a threshold requirement. A club simply cannot progress in the licensing process unless it abides by this rather pernicious sub-paragraph of Schedule 5.
My noble friend Lady Fox made an excellent case in saying that this should be removed from the Bill; it is disappointing. We have heard many times from the Government Benches—including the Minister and the Chief Whip, who is no longer in his place—that it is hypocritical for us on these Benches to criticise the provisions of the Bill, given that the previous Conservative Government introduced the original Bill. But noble Lords will now know that I refute this suggestion because I personally would have opposed many aspects of the Bill. I think it is a terrible Bill, frankly, and would have opposed it under the previous Administration.
The Benches opposite cannot make that charge on this particular aspect of the Bill, because this is a brand new inclusion by the current Administration. I am not sure why the new Government thought this was an important measure. It is disappointing that there are no Labour Back-Benchers supporting their own Government on one of the most contentious aspects of the Bill, although I concede that the hour is late.
There are already a whole host of measures that clubs and leagues take to progress inclusion and diversity. We had debates previously, a week or so ago, which made the point that this is covered, comprehensively, by the Equality Act 2010. It is also covered by a number of employment Acts, such as the Trade Union and Labour Relations (Consolidation) Act 1992, which would prevent direct and indirect discrimination without the heavy-handed nature of this provision. Because it is going to be set down in primary legislation as part of a corporate governance statement, it will very quickly become not just statute law but case law, so it will be a de facto tablet of stone—irrevocable, a settled document.
That worries me, because we know there is a huge amount of bureaucracy—and I can say this as a former human resources specialist. There are, per capita, more HR specialists in the UK than practically anywhere in the European Union and the developed world. That means there will not just be this corporate statement; there will be the bureaucracy of impact equality assessments, people specs, job specs, race action plans, EDI plans, LGBT plans, et cetera. This is what it will become. It will be about a divisive attempt to segment and disaggregate different fan groups. I think that will be deeply regrettable. Therefore, I think it will give rise to anger and resentment—the very opposite of the sense of cohesion, belonging, unity of purpose and community pride, which surely are the raison d’être of football.
As an example, Peterborough United—Posh—posted a single photo on its Facebook page of a Pride flag. I do not have a problem with a Pride flag. I treat gay and lesbian people with respect. They are football fans; they can come and go as they wish. I make no value judgment on that. But it gave rise to an absolute deluge of negative comments on the Facebook page, and it set fans against each other. It was seen, cynically maybe, as virtue signalling by Posh. It was a kind gesture, but it backfired, I am afraid.
The Bill claims to have the interests of the fans at its heart, and the Government claim the same. It strikes me as incredibly bizarre that they have no clue what the fans actually want. Is there any quantitative or qualitative data to back up whether this provision is needed in the Bill? Football fans are not interested in EDI. They want their clubs to be run properly; they want the teams to deliver high-quality football. They actually believe in fairness and decency, not tick-box virtue signalling.
Finally, there is the issue of cost to the clubs. Policy Exchange, the think tank, has highlighted its recent annual report, Politicising Business, the enormous cost that EDI can place on clubs. It has analysed the cost of the new EDI rules that the FCA brought in for firms that it regulates in December 2023. It estimated that the new rules will incur a one-off cost of £561 million, and ongoing costs of up to £317 million a year to businesses—that is over £500 million for firms simply to improve their diversity and equality policies, which are already embedded in existing legislation. Surely this cost will be prohibitive.
Finally, I ask: what are the objectives? What are the key performance indicators? What does success look like? What does a cost-benefit analysis look like? This is about appearing virtuous and will result in conflict and discord. I do not believe that it should be in the Bill. We should trust clubs to do the right thing and to treat people both properly and fairly.
Lord Moynihan of Chelsea (Con)
My Lords, the hour is late and I found my brain somewhat pounded into stupefaction by the thoughts of the noble Lord, Lord Parkinson of Whitley Bay. I found myself, perhaps disloyally and strangely, in agreement with the thoughts of the noble Lord, Lord Addington, on that matter. In this state of stupefaction, I am concerned about the serried ranks on the Government Benches waiting to jump on any mistake that I might make, so I hope that they, or perhaps their ghosts, will forgive me for any. I shall make just three quick points because the noble Baroness, Lady Fox, and the noble Lord, Lord Jackson, have said it all. I could perhaps just say what they said, but I shall try to make three very quick points, in view of the lateness of the hour and the evident but brave tiredness of the ranks in front of me.
My first point is that EDI is, believe it or not, for those who desperately believe in it and think it is tremendously important and essential to have in the Bill, a passing fad. It is a fashion. It is not even a fashion that we came up with: it is a fashion that we imported from America. My wife was, for many decades, a fashion designer in New York and she would point out to me how the colour would be decided in New York and the next year it would be copied in London. The line, the cut, the theme of fashion would be decided in New York and a year later would arrive in London. So it is with all these moral panics that, for the last decade we have seen arise, one by one, be taken very seriously and gradually fade away.
The noble Baroness, Lady Fox, talked about how, even now, American academia having become obsessed with it for many years, everybody is getting bored with it because it actually turns out to be a bit of a disaster. One by one, all these moral panics will disappear and, in coming decades, people will ask, “Why on earth did they think that way? What on earth told them to do that?” There is, as the noble Lord, Lord Jackson, said, no academic evidence. The academic evidence that companies such as McKinsey used to make hundreds of millions or more out of companies for selling these lines has been shown to be disreputable by careful academic analysis. I know; I used to work for McKinsey. There were 800 people around the world when I worked there; there are now 46,000 and the numbers grew on stuff like this, without any really valid academic basis. It is a passing fad and I hope we will not allow it to become implanted into football just at the time that it is beginning to fade.
My second point is that it crowds out useful activity. I spent decades advising chief executives of the largest companies in the world as to what they should do, and the one thing that I and so many others like me advised them on was focus: do not allow yourself to get distracted. But noble Lords who have been here during this Committee will remember that I have frequently described the Bill as a Christmas tree. What we have heard is everybody trying to hang baubles on the Christ1mas tree.
Baroness Brady (Con)
My Lords, I will address the amendment tabled by my noble friends which seeks to remove equality, diversity and inclusion requirements from the corporate governance code outlined in the Bill.
First, I acknowledge a concern that I believe underpins this amendment: the sense that EDI has, in some cases, become a compliance-driven exercise, where box-ticking and slogans replace meaningful action and real change. I recognise the frustration with the rise of what some see as the EDI industry, where jargon-laden initiatives create more paperwork than progress and risk alienating those they seek to engage. I share those concerns.
I know from my experience in football and the wider business arena that real change does not come from bureaucratic edicts or tokenistic gestures. In the end, change comes from understanding people and the barriers they face, the biases they encounter and, above all, the opportunities they need to succeed. For me, EDI must be about more than processes; it must be about outcomes.
This is where football, and particularly the Premier League and its clubs, is showing how it can be done and done well. The Premier League’s equality, diversity and inclusion standard, or PLEDIS, is a good example of an enabling framework that empowers clubs to embed EDI in their operations while avoiding the pitfalls of bureaucracy. I am very proud to say that West Ham United have been awarded the highest level of PLEDIS you can get.
PLEDIS is not a blunt tool; it does not impose rigid, one-size-fits-all rules. Instead, it provides clubs with expert guidance and a structured framework to identify their own unique challenges and set meaningful goals. For example, clubs are supported to collect and analyse data so that they can understand where underrepresentation exists, whether in senior leadership, academy coaching staff or community programmes. Clubs are helped to develop tailored plans based on their specific circumstances, whether that means increasing female representation in the boardrooms or improving accessibility for disabled fans. PLEDIS helps to bring about a genuine culture of learning and development. We have held some really good educational sessions about unconscious bias, cultural awareness and inclusive leadership.
I am not saying that everything the Premier League does is perfect, but we have tried collectively to develop a system that avoids the pitfalls of bureaucracy and instead empowers clubs to take ownership of their EDI journey. You need some outside help and challenge for it to work effectively. You need external expert support to ensure that clubs are not left to navigate this work alone and to help clubs turn principles into action, with practical advice rather than burdensome mandates. The key to success in EDI is not just to measure compliance but to drive cultural change. That is what the Premier League approach aims to achieve. I believe that PLEDIS almost always continues to be used when clubs are relegated to the Football League, because clubs find it so valuable.
Consider too the impact of initiatives such as the Premier League’s No Room For Racism campaign. Although public facing, this work is backed by systemic efforts within clubs to tackle discrimination, create pathways for underrepresented groups and hold those in power accountable for progress. The Premier League has developed great programmes to develop more black coaches, bring more South Asian players through the talent pipeline and help black players on the path to becoming club executives.
All this matters, and I fully agree with my noble friend Lady Fox that it cannot be about box-ticking. It is about ensuring that every player, coach, staff member and fan feels that football is for them. When implemented correctly, EDI does not create diversion or resentment; it fosters unity by ensuring that everyone has a fair chance to participate and succeed.
I have a lot of sympathy for my noble friends who worry about the potential for overreach or missteps in EDI, and my noble friend Lady Fox is right that poorly conceived and implemented EDI policies will be burdensome and ineffective. But now that EDI has been put into the Bill, my approach will be to work with the football regulator to ensure that it is done thoughtfully, innovatively and with that laser focus on outcomes. Football clubs will have nothing to fear from embracing this work. EDI done well is not a threat; it can strengthen clubs by ensuring they reflect the communities they serve and are able to attract diverse talent, and will fundamentally make their clubs better places for everyone to work.
This does not have to be a binary choice between rigid mandates and doing nothing. The best path forward is an enabling framework supported by expert guidance and underpinned by meaningful accountability. Clubs should be encouraged, not coerced, to embrace this work; it can and it should be aspirational. I urge the Government and the regulator to consider how these requirements can be implemented with that spirit in mind.
Lord Parkinson of Whitley Bay (Con)
My Lords, I am grateful to the noble Baroness, Lady Fox of Buckley, for bringing this amendment and for giving us opportunity to look at the new additions that the Government have put in the Bill. As my noble friend Lord Jackson of Peterborough reminds us, this is one of the areas in which the Bill has changed from the Bill that was before the previous Parliament. He did not like the other one either, but I think that it is clear that he likes these provisions even less.
While I am highly supportive of efforts to improve equality of access for people in football and indeed in all sports—when we last looked at these issues, I spoke about the progress we have made in tackling the horrendous racism and homophobia that blighted football for a long time—I share some of the concerns that my noble friends, including my noble friend Lord Moynihan of Chelsea, have raised about enshrining in law what are clearly shifting sands. As the ever-changing acronyms and the ever-expanding rainbow of colours on flags and lanyards show, this is an area that continues to change, and we must not allow the noble aim of opening up access for people and treating everybody with equal respect to be pegged to a certain moment in time in the way that it is done. I am mindful too, as my noble friend Lady Brady has just reminded us, of the enormous strides that clubs have taken to drive improvement in this area, and we congratulate West Ham on the recognition that they have won for their work on that.
We must be very wary of what is a mandatory requirement in the Bill, in the way that the noble Baroness’s amendment focuses on, and the clear cost and burden that will impose on the clubs that have to comply with it. My noble friend Lord Jackson of Peterborough spoke about those costs and burdens, and he was right as well to worry that, with the work that is done in this area, we sometimes inadvertently bring about division rather than diversity as we pit various groups of people against one another in what sometimes feel like informal hierarchies of grievance.
I share some of the concerns that my noble friends have raised, and I am grateful to the noble Baroness, Lady Fox, for honing in on this further requirement that the Government seek to impose on clubs. I hope the Minister will respond to the points that they have raised.
Lord Addington (LD)
My Lords, all I can say about this is that I may not have disagreed with every single word that the noble Baroness, Lady Fox, said, but I certainly disagreed with her tone.
Baroness Twycross (Lab)
My Lords, reflecting the point from the noble Lord, Lord Addington, I am afraid that the noble Baroness, Lady Fox of Buckley, and I fundamentally disagree on this area of the Bill, but I am glad of the opportunity for your Lordships’ House to debate this issue and thank her for the amendment, as it allows me to clarify why the Government have added this provision.
The Government believe that equality, diversity and inclusion are key elements of good corporate governance. This is not about moral panic, as described by the noble Lord, Lord Moynihan of Chelsea, or virtue signalling, as described by the noble Lord, Lord Jackson of Peterborough. I appreciate that the noble Lord, Lord Moynihan of Chelsea, will have a different view on the research from the likes of McKinsey, but it has shown that diversity on boards and in organisations promotes better governance, decision-making and transparency—arguably, the noble Lord’s point about its growth as a company might demonstrate that it could have a point. All this, in terms of better governance, decision-making and transparency, contributes to improved financial sustainability. The noble Baroness, Lady Brady, highlighted the value of considering EDI within the corporate space.
This relationship between diversity and better corporate performance is recognised also by the Financial Reporting Council and the Association of Chartered Certified Accountants. The industry is already taking action in this space, and I welcome the expertise of the noble Baroness, Lady Brady, in this area and her example of PLEDIS, but for a regulator that will be introducing a corporate governance code and requiring clubs to report against it, it is only right that such a code also covers EDI. The regulator will look to co-operate with other stakeholders, draw on the expertise of the sector and add to industry initiatives. I am sure that they will want to engage with the noble Baroness, Lady Brady, on this point as well.
As with fan engagement, this will be a statutory baseline, so clubs that already champion equality, diversity and inclusion will not have any additional burden placed on them other than having to periodically report on these things. Under the corporate governance code, clubs will simply be required to explain how they are applying the code and what action they are taking on equality, diversity and inclusion. That is not onerous, but it is a very helpful transparency measure. This transparency will only be a good thing, and I am afraid that if noble Lords disagree with that, we are simply of very different minds on this issue.
Lord Jackson of Peterborough (Con)
Before the Minister sits down, may I ask, given that this is a specific difference from the previous Bill, what specific football-related research was commissioned by the Government that led them to believe that it was imperative to add this provision to the new Bill? If that question is too difficult to answer now, perhaps the Minister will write to me.
Baroness Twycross (Lab)
My Lords, it is getting late and I have just dropped all my notes. This is not actually about football per se; it is about good governance. The regulator will be concerned with sustainability. As a sustainability regulator, its interest in equality, diversity and inclusion is that it contributes to good corporate decision-making, which, in turn, makes clubs more sustainable. This is why the regulator will encourage good EDI in clubs by requiring them to report on what action they are taking to improve EDI. That transparency will only be a good thing. I therefore hope that the noble Baroness will withdraw her amendment for the reasons I have given.
Lord Moynihan of Chelsea (Con)
Before the Minister sits down, may I offer to send her the academic study headed, “Study linking ethnic diversity with performance by McKinsey questioned by academics”? I am very happy to send her this. It completely rebutted the McKinsey finding that she quoted. It would be very useful were she to understand that that has been rebutted, so that she might not be quite so keen on the ideas she wishes to espouse, and we could come together on that point.
Baroness Twycross (Lab)
The noble Lord is very welcome to send this to me, but I am afraid that, as somebody who used to work in governance myself, I am quite committed to the concept that good governance should also include good EDI.
Baroness Fox of Buckley (Non-Afl)
My Lords, I thank all those who joined in with this short debate. To the noble Lords, Lord Jackson and Lord Moynihan, and to the noble Baroness, Lady Brady, I emphasise that, despite what anybody says, they are not my friends, even though they call me their friend. I do not mean that in any rude sense. I know that the noble Lord, Lord Addington, has decided that he has taken against my tone. I do not know what I have done wrong there. I did not think I had a tone: I just made a speech. I just want to clarify that they are not my friends, but they spoke brilliantly well and interestingly on this issue.
It is very important to draw the Government’s and the Minister’s attention to new evidence that has emerged. I know the Minister did not mean to say this, but it is not advisable to say, “I have worked in this, and I am committed to this view”, given that circumstances are changing and new evidence is emerging all the time. It would be better to be open-minded. I made the point about the Post Office, and it is a good example. The Post Office won those awards for EDI and good governance at the same time as the Post Office scandal.
I definitely do not want to micromanage freedom of speech—and I do not think that the Government have any intentions of doing that through this part of the Bill—but to say that this is not the appropriate time to raise trans inclusion is not true. The truth of the matter is that it is through EDI policies that the issue of trans has become so controversial for women in women’s football. I have not raised this just because I am trying to shoehorn it in; that is the basis on which it happens.
Before I formally withdraw because of the time, I finish by saying that I absolutely do not think that football clubs should sit back, do nothing and not care about the fact that they are inaccessible to anybody or should put up any barriers to anyone getting involved in football. Most football clubs are at the heart of their community, and they do not need to fulfil all these schemes to involve a wide range of people. Every small football club I know is going way beyond anything that any EDI pen-pusher could imagine to involve the socially excluded from the local area. They are the heart and soul of local areas. My concern is that they will end up spending too much time writing reports and not doing that. That is my concern about EDI: it is an industry, so it is not helping to include anyone or create any diversity and so on. It has become a politicised, dangerous threat. I beg leave to withdraw the amendment.
Member’s explanatory statement
This amendment permits the Regulator to restrict funding for clubs which may be linked to conduct harmful to the interests of the United Kingdom.
Lord Parkinson of Whitley Bay (Con)
My Lords, in moving Amendment 170, I will speak also to the other amendments in this group in my name, Amendments 194, 196 and 197. These all relate to foreign interference in football clubs, a topical issue today, given the debates that have taken place in another place on Chinese espionage and the Government’s tardiness in introducing a foreign influence registration scheme.
Amendment 170 in my name seeks to expand the scope of the regulator’s role in varying a club’s licence conditions. As drafted, the Bill is clear that the regulator may vary a club’s licence conditions to restrict its acceptance of funding which the regulator reasonably suspects to be connected with serious criminal conduct. This is a very significant power and an important one—none of us wants to see funding connected with serious criminal conduct in football. By the same token, I hope the Government would agree that funding that the regulator reasonably suspects to be linked to conduct harmful to the interests of the United Kingdom should have no place in football either.
There is an important point here, as those involved in funding football in this country might be involved in perfectly legal activities internationally, which, while legal elsewhere, may harm our national interest. I hope the Minister can explain why, if the regulator is equipped to make a judgment about criminal conduct, it would not be able to make a judgment on conduct that is harmful to the national interest as well.
Amendment 194 seeks to expand the terms of reference for the regulator’s determination of whether a person has the requisite honesty and integrity to own or run a football club to include whether an individual is a member of a proscribed terrorist organisation. The principle behind this amendment is that proscribed terrorist organisations have no place in football. I am sure that all noble Lords in the Committee agree with that.
The Government may argue that this amendment is not necessary but, given the number of foreign owners of clubs and the many appointments of international officers in the football sector, it would give the regulator the power it needs to protect football from people who are found to be members of proscribed organisations. Sadly, it is far from inconceivable that somebody resident in the UK might be found to be a member of such a proscribed group. In those circumstances, surely the Government would want the regulator to have the tools to end their involvement in football swiftly. What assessment have the Government made of the risk of people who are members of proscribed terrorist organisations being involved in football clubs in this country? Have the Government looked at this and deemed it unlikely? Have Ministers come to a view about an acceptable level of risk? If the risk is greater than zero, can the Minister explain why the regulator should not have a power such as I have set out?
I accept that proscription is not always of the same utility in relation to different terrorist networks or to the work of lone wolves. I would be happy to discuss a broader criterion, perhaps looking at a reasonable belief that someone is involved in terrorist-related activity, to capture that. I think there is a loophole that we ought to try to close in our scrutiny of these provisions.
Amendments 196 and 197 relate to Clause 37. They seek to ensure that the regulator can carry out its duties effectively, responsibly and in close co-ordination with key public bodies that can assist its work in this area. Amendment 196 would require the regulator to consult a range of bodies, namely the National Crime Agency, the Security Service, the Secret Intelligence Service, the Serious Fraud Office, His Majesty’s Revenue & Customs and the Sports Grounds Safety Authority.
The regulation of football clubs cannot be divorced from our wider national interest. Football is more than a sport. It is a vital part of our national culture, economy and global reputation. We know it is a sector that can attract bad actors, financial mismanagement and, in some cases, criminality. Whether it is safeguarding clubs from fraud, tackling money laundering or ensuring that stadia meet safety standards, the regulator will need the insight and expertise of these key agencies in doing its work. This is about equipping the regulator with the best possible advice. I hope that the Minister will look at that with some care.
Finally, Amendment 197 would replace the mandatory “must” with the discretionary “may” in relation to the regulator’s engagement under Clause 37(3). This minor adjustment carries significant practical implications. Its purpose is to avoid placing an excessive legal burden on the regulator to consult in circumstances where it may not be necessary or proportionate. By providing discretion, we would give the regulator the flexibility it needs to prioritise its resources and respond to situations on a case-by-case basis. This amendment would not weaken the regulator’s responsibilities; rather, it allows for common sense to prevail. It reflects our commitment to safeguarding the integrity of football while ensuring that the regulation is not heavy-handed. I beg to move.
Lord Jackson of Peterborough (Con)
My Lords, I support my noble friend Lord Parkinson’s excellent amendments. They are straightforward, sensible and in keeping with recent developments whereby the previous Administration established in primary legislation quite strict rules about the takeover of British businesses by foreign entities. Soft power and the global kudos and prestige of football cut both ways. They could be used by bad actors, foreign countries and state-owned entities in those countries for nefarious and possibly criminal activities such as money laundering.
Therefore, the Government would be wise to take on board the concerns that some of us on this side of the Committee have. In that respect, Amendment 196 is sensible, because we have a regime which looks at foreign entities’ ownership of UK interests. It would be irresponsible to disregard the intelligence and information provided by the agencies mentioned, particularly the National Crime Agency and the security services, in making a reasonable, fact-based decision about the efficacy or otherwise of ownership.
Given that ownership runs through this Bill quite prescriptively at a micro level, in terms of very small clubs, it is only sensible for the Government to consider how big strategic ownership decisions would be affected by this Bill. In that vein, it would be wise for the Government to consider accepting these amendments.
Baroness Twycross (Lab)
I thank the noble Lords, Lord Markham, Lord Moynihan and Lord Parkinson of Whitley Bay, for tabling these amendments. I will take them in turn.
On Amendment 170, in the name of the noble Lord, Lord Markham, I understand that the intention behind the amendment is to allow the regulator to block a club from accepting funding that it reasonably suspects to be harmful to the interests of the United Kingdom. I agree that it is important to protect clubs from harm; that is what the Bill as a whole seeks to do. The intention of having this power, as set out in the Bill, is to protect English football from illicit finance and keep it out of the game. Illicit finance is inherently unsustainable.
However, I caution the noble Lord as to the implications of a football regulator discerning what is harmful to the interests of the United Kingdom and then blocking such funding. This is not something that a regulator can determine. They can make evidenced-based decisions on facts in a clearly defined framework. It also must be noted that there are protections in the Bill that go beyond protecting against serious criminal conduct to protect against wider harm. For example, the owners’ and directors’ test will look at the fitness of a club’s owners and officers, including any criminal history and investigations and whether the individual has been prevented from entering the UK. This seeks to protect English clubs from unsuitable owners or officers making decisions that may endanger their club. This, in conjunction with the power to restrict funds suspected to be connected to serious criminal conduct, will help to ensure that clubs are protected from harm.
I turn to Amendments 194, 196 and 197 in the name of the noble Lord, Lord Parkinson. On Amendment 194, I reassure the noble Lord that the intent of his amendment is already achieved within the current drafting. When assessing an owner’s or officer’s fitness, the regulator must have regard to any criminal convictions and proceedings, including those included in Schedule 1 to the Serious Crime Act 2007. Membership of a proscribed organisation is an offence under the Terrorism Act 2000, and that offence is included in paragraph 2A of Schedule 1 to the Serious Crime Act. Consequently, the current provisions in the Bill deliver the intent of this amendment. I hope that he is reassured by that.
On Amendment 196, I agree that it is vital that the regulator has access to information when assessing the suitability of owners and officers. The regulator may need to work closely with other organisations and stakeholders when exercising its wider functions. That is why the Bill establishes information-sharing arrangements with a range of organisations including the National Crime Agency and the Serious Fraud Office and why it adequately empowers the regulator to gather information, including from other organisations, to assess suitability. However, to require the regulator, as the amendment would, to always consult multiple organisations, even when this is not necessary to its ability to make an assessment, would be disproportionate. It would lead to slow decision-making, impacting on growth and investment. It would be a wholly unnecessary burden on clubs. As part of the fitness test, officers will be assessed on their competence, specifically their qualifications, experience and training.
Amendment 197 would give the regulator discretion as to whether to consider these matters when assessing competence. General public law obligations would still require the regulator to act consistently and fairly when testing officers. However, this amendment would give officers less certainty about what they will be tested on.
Finally, on the amendment from the noble Lord, Lord Moynihan, the whole point of the owners’ and directors’ test, which has been carefully designed, is to ensure that club custodians are suitable for assessing an owner’s fitness—this is absolutely crucial. It is right that any owner passes the tests set out in the Bill, so it would not be fair, appropriate or responsible to exempt certain types of owners from testing, but that is precisely what this amendment seeks to do. This amendment intends that owners with diplomatic status or who are Heads of State, Government Ministers or high-ranking officials of foreign Governments would not be tested. I do not need to tell noble Lords about some of the people this could exempt from testing. That means that the regulator could not consider any personal finances or criminal history, no matter how egregious. Instead, it would have to ignore these matters, so the regulator could be letting unsuitable owners in. This could be incredibly risky for the club, and any incumbent owner captured by this amendment could also never be tested, even if concerning information subsequently came to light.
Suitability should be based purely on an impartial assessment of the criteria set out in the Bill. This will ensure that the test can be applied consistently, remain fair, transparent and robust, and focus on whether an individual is suitable to own a football club. For the reasons I have set out, I would therefore be grateful if the noble Lord would withdraw his amendment.
Lord Parkinson of Whitley Bay (Con)
As the Minister spoke, I wondered whether the staff and relevant board members of the regulator will have the requisite security vetting to be able to consider some of the matters that they might need to in this area. One reason I was keen that they engaged the appropriate authorities was to make sure that things which are, by nature, highly classified and sensitive can be provided to them so that they can give advice. If the Minister is not accepting my amendment to open the channels of dialogue there, is she able to say anything, now or later in writing, about the vetting that staff and others at the regulator would receive?
I am conscious that immediately before we came into this Committee, the Minister’s noble friend the Lord Privy Seal moved the Motion to appoint members to the Intelligence and Security Committee. We make sure, rightly, that people who are suitably qualified are able to look into this area of our laws. I wonder whether she can just say a little, now or later, about the vetting and assistance that staff will have?
Baroness Twycross (Lab)
I could talk at great length about this, but instead, I reassure noble Lords that I can confirm that staff will be able to engage with all relevant authorities on such issues.
Lord Parkinson of Whitley Bay (Con)
I appreciate that it is late. If the noble Baroness could put some of what she might have said in a letter, that would be useful. It is unfortunate that we are reaching what is a rather serious subject at what I know is a late hour with very few people left in Committee, but it would be helpful to hear a bit more about this as we ponder the issue further ahead of Report.
Baroness Twycross (Lab)
I would like to make it explicit that they will have the relevant clearance to deal with this issue.
Lord Parkinson of Whitley Bay (Con)
I am grateful to the noble Baroness for that. If there is more she is able to say, I am sure that other noble Lords who are not able to be here and who take an interest in these matters would appreciate that.
The noble Baroness said that the regulator is not really equipped to decide what is harmful to our national interest. That is why, in our version of the Bill, we had the provision on taking into account UK trade and foreign policy. I know the reasons why the Government have taken that out of the Bill—because of the concerns UEFA and others raised about political independence—but I worry that, in doing so, we might lose something about our national interest which is quite important. That is why I was seeking to reinsert that criterion into the consideration. We might come back to that issue once she is able to say anything more that she wishes to, and once other noble Lords who are interested can join the discussion on this point.
Given the hour, and with gratitude to the noble Baroness for all her answers today, I beg leave to withdraw my amendment.