United Kingdom Internal Market Bill

Debate between Baroness Henig and Lord Tyrie

Committee stage & Committee: 4th sitting (Hansard) & Committee: 4th sitting (Hansard): House of Lords
Wednesday 4th November 2020 Lords Chamber

[The Deputy Chairman of Committees (Baroness Henig) (Lab)]

I am assuming that the noble Lord, Lord Naseby, has scratched from this group, so I call the noble Lord, Lord Tyrie.

[Lord Tyrie (Non-Afl)]

Some very interesting points have just been made that bear serious consideration, and the concerns we have just heard are reasoned, particularly on SMEs. At the very least, the Government may wish to offer a review of the CMA’s use of these powers, after an interval, to give us the assurance that they are being proportionately deployed and to see whether they need some amendment. The argument that they were derived from legislation the purpose of which was very different is well taken and might point to further amendment.

Overall, I support the Government in what they are trying to do here, having decided to create the OIM. It is true that the powers are robust, but they will need to be. If the CMA is to be expected to offer timely and high-quality advice, it will need to secure information quickly, without being given the runaround by devolved Administrations or parts of the private sector.

The penalties proposed are a weakness, though. Crown immunity will be in play for the devolved Administrations. I would be interested to know what thought the Government have given to the penalties that can be imposed for non-compliance in those cases. Public censure might help; on the other hand, a devolved Administration standing up to nasty Westminster might win local plaudits, resulting in the opposite effect. A lot of careful thought needs to be put into this issue if these measures are to be made effective. The proposed fines on the private sector are capped at £30,000. I simply do not see that sum troubling a recalcitrant or determined large third party. Has the Minister considered larger fines in certain circumstances?

It might be helpful to make one more general point. The CMA’s existing arrangements for securing compliance and information gathering across all its other functions are manifestly inadequate, as I saw it during my time there. They should not be used as a benchmark. Incidentally, the £30,000 figure comes from the merger regime. Something has to be done. The European Commission recently fined Facebook £1.6 million for not supplying information, while the CMA recently fined Amazon £30,000 over the merger with Deliveroo for not supplying information. That should give some idea of the disparity.

In February 2019, the CMA put proposals to the Government for improvements to information-gathering powers across all its functions. First, it needs to be able to gather information from a much wider range of sources to reflect the increasingly digital nature of the information that it is trying to collect: iCloud, machine-learning algorithms and so on spring to mind. These are not at all easy to capture with existing legislation. Secondly, and even more importantly, subject to safeguards, the CMA needs a general information- gathering power outside the context of a formal investigation. I do not like giving general powers, but I think the CMA now needs this to find out what is really going on in markets and enable it to think through much better than it can at present. It needs to be able to use the full range of tools to best bear down on consumer detriment. It is struggling to do that at present, and increasingly so with the growth of rip-off culture.

When the Minister returns to his department, he will find the proposals, of which I am just touching the surface, have been fully developed by the CMA and are sitting with his officials. Will he agree to take another look at those proposals to see what might usefully be drawn from them? For improving the ones we are discussing today, quite a lot of what is in there is likely to be relevant. Will he agree to report back to the House on what he has found?

I have been following this Bill closely, particularly Part 4, which I have an interest in because of my previous job. Some very important points have been made across the Committee, not least in Monday’s relatively brief debate on Clause 28 about whether the CMA is the appropriate body in the beginning to have responsibly for these functions. Those points are sufficiently important for us to have another look at them on Report. I hope the House will find a way to enable us to do this.