Economic Activity of Public Bodies (Overseas Matters) Bill

Debate between Baroness Janke and Baroness Neville-Rolfe

Committee stage
Wednesday 20th March 2024 Lords Chamber

[Baroness Janke (LD)]

My Lords, very many points have been made about how the decision-maker is established. From the point of view of local government, in local councils there are very many ways of taking decisions that can be individual or corporate. The tiers of responsibility and the trails that decisions make throughout a large organisation would need to be explored if enforcement action was to be taken.

In addition, councillors, committees or even pension committees, as we heard earlier, are advised by experts and independent advisers, so it is not clear where the line of accountability is and who is responsible, who is to be identified for enforcement action. The public authority, as has been identified earlier, is the body that is talked about in relation to Clause 4, but it is not in the Bill and does not relate to any other part of decision-making. I add my plea for further clarification as to how the decision-maker is to be identified and how enforcement is to be pursued in light of that.

As far as pension funds are concerned, as a former member I know that expert advisers do take account of political situations in their evaluation of risk. Again, that may be intimidating for councillors or advisers and inhibit the quality of advice that is given.

[Baroness Neville-Rolfe (Con)]

My Lords, Amendment 7, tabled by the noble Lord, Lord Collins of Highbury, and Amendment 55, tabled by the noble Baroness, Lady Chapman, seek clarity on whether an individual is considered a decision-maker for the purposes of this Bill. It was helpful to hear the introduction from the noble Baroness and her wish for general elucidation. As she implied, it is an important part of the Bill’s provisions. I will try to confine my points mainly to decision-makers, which are the purpose of this group.

A public authority will generally delegate responsibility for decision-making on procurement and investment decisions to individuals within the public authority. The individuals who make the decision on behalf of the public authority will do so in accordance with the public authority’s internal policies and structures. To address the noble Baroness’s question on enforcement, even when an individual is making decisions or speaking on behalf of a public authority, the ban applies only to the public authority itself. There is no personal liability for the individual. Individuals will therefore not personally be responsible for any fines that may be imposed on public authorities for a breach of the ban in Clauses 1 or 4.

On the noble Baroness’s question on pensions—this is something I know about because I have served as a pension trustee, admittedly in the private sector—this is something we can come back to in more detail when we discuss Clause 12, but I will also look at the Local Government Association material that she referenced, which I am sure will be helpful and interesting.

My noble friend Lady Noakes made the point that there are some limited cases where individuals are the public authority in their own right. She asked for examples, so I suppose that examples would be UK Government Ministers, Ministers from devolved Administrations and police and crime commissioners. They could also be individuals such as mayors if they exercise public functions in their own right. Any individual who is a public authority in their own right is already subject to far-reaching and fundamental duties under the Human Rights Act 1998. They could be subject to court action if they restrict others’ human rights, and the duties in the Human Rights Act are much more wide-ranging than the prohibitions in this Bill. It would not be appropriate for these individuals to be pursuing policies that are not in line with the official foreign policy, which is, of course, set by the UK Government. To be clear, local authority councillors and university leaders are not public authorities in their own right.

Amendment 55 would require the Secretary of State to publish guidance to clarify in what circumstances an individual is a decision-maker before the Bill commences. We do not believe that it would be appropriate to publish guidance on this matter, as every public authority is structured differently and has different policies on how its internal decision-making process operates. As it happens, as the noble Baroness, Lady Janke, said, structures vary a lot, and that is the case.

To give the House an example, in the case of local authorities, they will have a scheme of delegations in place, with, for example, a commissioning board, which will indicate who takes procurement decisions. While the decision is made by the individuals on the board, they have been empowered to take those decisions via the scheme of delegations, and it is therefore the local authority that is the legal decision-maker in the context of the ban. This is made clear in Clause 2(1) of the Bill. Even when an individual is making decisions or speaking on behalf of a public authority, the ban applies only to the public authority itself and there is no personal liability for the individual. Therefore, individuals will not personally be responsible for any fines that may be imposed on public authorities for a breach of the ban. The concerns on this issue—

Pension Schemes Bill [HL]

Debate between Baroness Janke and Baroness Neville-Rolfe

Report stage & Report stage (Hansard) & Report stage (Hansard): House of Lords
Tuesday 30th June 2020 Lords Chamber

[Baroness Neville-Rolfe [V]]

My Lords, as noble Lords know, I am as concerned as anyone with consumer protection. I therefore welcome the amendment which we have agreed to during the passage of the Bill to ensure that the Money and Pensions Service provides a public-owned dashboard. That was a great step forward, and we will come on to that on the next amendment.

However, I fear that this amendment could stop commercial experimentation, which is desirable if properly regulated. As I understand it, any organisation providing a pension dashboard must achieve authorisation from the FCA. Innovation is important and can help consumers and pensioners. If the amendment were passed, it could have a chilling effect and prevent innovation until another Bill had cleared Parliament—not, I suspect, a welcome prospect for HMG after the extent of the amendments made to this Bill.

I have a question for the Minister. I am a little concerned about compliance with GDPR, which obviously is important in securing equivalence in the EU context, where portability is a key requirement. I wonder if the amendment could run us into any trouble on that aspect of regulation.

[Baroness Janke [V]]

My Lords, I support Amendment 52. I also support the other two amendments tabled by the noble Baroness, Lady Altmann, as a result of the matter being much debated in Committee, I am very grateful to the noble Baroness, Lady Drake, for her clear analysis of the issues involved.

Many would say that pensions dashboards are long overdue. They enable people to plan their future finances taking account of existing pensions, and to take a long-term view of future financial provision. However, the challenge of producing a dashboard that will adequately cover the complexity of the pensions landscape should not be underestimated. We are talking about millions of people, and the enormous number of lost pensions that we hear about shows both the need for and scope of the task. Given the level of complexity, the scope for scams and fraudulent actions increases and it is therefore essential that members of the public are sufficiently protected.

As many noble Lords have said, the vulnerability of many people means that they can be much more susceptible to scams and bogus claims and apparently attractive offers from the commercial sector. The additional factor that digital literacy and access can be problematic for some people also needs to be considered. That and the lack of sound advice can lead to bad decisions and life-changing, irreversible mistakes, as we heard from the noble Baronesses, Lady Drake and Lady Altmann, in Committee.

Pensions is a complicated subject; it is not easily accessible by everyone. Lack of engagement, which has already been talked about, is a result and, as the noble Baroness, Lady Drake, said, people often take the line of least resistance and take wrong decisions that they are unable to change. I hear the arguments made by the noble Baroness, Lady Neville-Rolfe, about innovation. Certainly, it is an important factor, but I feel that the protection of pension holders is more important. Measures to provide full protection should be the subject of further primary legislation rather than secondary legislation, as indicated in the Bill.

--- Later in debate ---

[Baroness Neville-Rolfe [V]]

I welcome my noble friend Lord Young’s probing amendments on verification and timing, and I look forward to hearing from the Minister. I was very struck by the summing-up on the previous amendment by my noble friend the Deputy Leader of the House, who showed just how strong the Bill is on consumer protection and to what lengths the Government have gone to meet the House’s concerns. But others have just tried to use the Bill to bring in yet more burdensome measures.

For me, Amendment 63 takes the biscuit, because the Government have agreed to bring in a Money and Pensions Service dashboard so that there is a government, public-funded version that includes people’s various pension pots and the old-age pension. The proponents of this amendment are then trying to exclude the trail-blazing commercial version, which was behind the Bill in the first place and is designed to help savers, building on the good practice that exists out there in the best pension funds and elsewhere. The amendment would lead to a delay of a year for those dashboards, yet they will all be properly regulated and monitored and MaPS would be in the lead. Competition from others will be an incentive to quality and speed, helping to identify the bugs that the noble Baroness, Lady Drake, who knows so much about pensions, referred to.

I cannot support this amendment. It is worrying that the Government are losing on a series of inappropriate amendments because noble Lords are not coming to the House to speak and listen, but can vote from their garden benches.

[Baroness Janke [V]]

I support Amendment 63 and am not voting from a garden bench. The case for this amendment has been very well stated and I will therefore not take up time by repeating it here. I support Amendment 63 and will vote for it if there is a Division.