Trade Bill

Baroness Neville-Rolfe Excerpts

3rd reading & 3rd reading (Hansard) & 3rd reading (Hansard): House of Lords
Monday 18th January 2021 Lords Chamber

[Lord Curry of Kirkharle (CB) [V]]

My Lords, my interests are as listed on the register. I will be brief; I fully endorse all the amendments proposed in this group.

I have a few comments on the proposed trade and agriculture commission but, first, on behalf of my friends on the Cross Benches, I thank the Minister for being so helpful and considerate throughout the passage of this Bill. His patience and willingness to engage have been very much appreciated, particularly when the sense of time pressure has been apparent. Obviously, the constraints of the pandemic have imposed on the parliamentary process, and coupled with the need to speedily expedite so many Bills to meet the timetable determined by leaving the European Union, this has placed enormous pressure on the system—not only on Ministers but on the myriad of staff teams that have of necessity been required to support this demanding timetable. I thank all for their valuable support, which has been incredibly important and is very much appreciated.

I thank the Government again for recognising the need for the trade and agriculture commission, and for deciding to give it statutory footing through the Bill. This is a hugely important step forward and is valued by all key stakeholders. I have a very straightforward request for clarity from the Minister, and I apologise for raising this again. It is on the relationship between the TAC and the food standards agencies. I am deliberately using the plural because of the separate functions that exist within the United Kingdom, and these amendments today are addressing issues relating to the United Kingdom. Removing human health from the remit of the TAC—because, one assumes, the food standards agencies will undertake that responsibility—raises the question of how this will work in practice when a new trade deal is being scrutinised by all these bodies, and how this will be reported to Parliament. Will there be a number of separate reports, will the individual bodies and agencies collaborate and produce a joint report, or will the Secretary of State filter the various reports before submitting to Parliament?

I know that the Minister tried to respond to these issues on Report, so I apologise that I am probably stretching his patience to the limit, but I am still rather confused and would appreciate it if he could please explain it again so that I have clarity. I end by thanking all staff once again for their immensely valuable help with this most important Bill.

[Baroness Neville-Rolfe (Con)]

My Lords, I declare my interests, notably as chair of the UK-ASEAN Business Council, and of Crown Agents. I congratulate the Minister and my noble friend Lord Younger on getting this important Bill to this stage after such an extended passage. I endorse the comments of the noble Lord, Lord Curry of Kirkharle, about the support provided by the Ministers and their professional and helpful team.

Britain has a great trading history and we must enter the new era with confidence, backed by our strengthened Department for International Trade and the new Foreign, Commonwealth and Development Office. I spell them out for good reason: there is potential in goods, services and digital.

My noble friend will recall that there were some uncertainties on Report, and that in summing up and withdrawing his amendment, the noble Lord, Lord Stevenson of Balmacara, said that he or I might come back at Third Reading. This seems the right place to ask my questions, since the operation of powers in the devolved nations was under discussion. That has been clarified in these government amendments, to which I do not object, despite the earlier reservations I had expressed. I have given advance notice in the hope that the Minister can reassure me.

The clauses on trade information enable HMRC to collect information about UK exporters. It has been made clear all along that compliance with the request would be entirely voluntary. On Report, my noble friend the Minister said that the practical implementation of this would be a “tick box” on the tax returns—presumably, both corporate and personal. However, he gave no indication of the sorts of questions that would be asked; can he kindly do so today? I appreciate that this will be in regulations in accordance with what was Clause 7(4), but we need an idea of what information will be sought. For example, will it be the name of the trader, and which country or countries they exported to in the tax year in question? Will they need to provide a breakdown of customs headings?

Gas Boilers and Heaters: Replacement Programme

Baroness Neville-Rolfe Excerpts

Tuesday 12th January 2021 Lords Chamber

[Lord Callanan (Con)]

I understand that the noble Lord is very keen on green hydrogen and I agree with him on these points, but we are committed to consult on the preferred hydrogen business model in quarter 2 of 2021 to finalise a decision next year. Alongside this we will bring forward further details in 2021 on the revenue mechanisms that will be available to support these proposed business models.

[Baroness Neville-Rolfe (Con) [V]]

My Lords, planning for the phasing out of all use of gas boilers is, to my mind, a very bold step, especially when the nature of the possible replacements is unclear. What steps are the Government taking to ensure that the energy and construction industries will have the capacity to cope with this change? For example, I understand that there is currently capacity to install only 30,000 heat pumps a year, whereas the need is estimated to be more than 600,000.

[Lord Callanan (Con)]

My noble friend makes some very good points, but the forthcoming heat and building strategy will set out the direction of travel for decarbonising heat. We are working closely with the industry to create the jobs needed to meet net zero. We recently carried out research. There will be enough skilled heat pump installers to deliver our ambitions. We recently published that supply chain research, which shows that heat pump manufacturers are able to meet a significant ramp up in demand.

Trade Bill

Baroness Neville-Rolfe Excerpts

Report stage & Report: 3rd sitting (Hansard) & Report: 3rd sitting (Hansard): House of Lords
Wednesday 6th January 2021 Lords Chamber

[The Deputy Speaker (Lord Haskel) (Lab)]

I call the noble and learned Lord, Lord Morris of Aberavon. He is not there, so we will move on to the noble Baroness, Lady Neville-Rolfe.

[Baroness Neville-Rolfe (Con) [V]]

My Lords, I rise to express my concern at these amendments. They have been presented at length and with much eloquence by the noble Lord, Lord Hain, and others. However, they ought not to be for this Bill.

This is not a Bill on our future relationship with the EU or the Northern Ireland protocol. We put all that to bed last month; there is another debate on Friday and a great deal of work continues not least in the EU committee on which I have the honour to serve and in the Joint Committee. However, except on procurement, the Trade Remedies Authority and data, this Bill is concerned with existing agreements between the EU and third countries. I take this opportunity of congratulating the Minister and Secretary of State Truss on the 63 agreements concluded with third countries in the last year, a record that will undoubtedly stand. The idea of attaching new conditions to such continuity agreements on other policy areas such as the Good Friday agreement, however strongly felt by those involved, is inappropriate. I will vote against the amendment for that reason, as I hope will others across the House.

The EU deal is behind us, thanks to the Prime Minister, my noble friend Lord Frost and the team, and the time has come to get this Trade Bill, which started as long ago as 2017, on to the statute book. I will not extend proceedings by speaking on other amendments which suffer from the same problem and which will also, no doubt, be presented with an equally eloquent case. We do no good in this House by introducing these kinds of conditions into inappropriate or irrelevant Bills. To my mind, they should be rejected.

Separately, as someone who loves and has historically been involved in investment in Northern Ireland, and in the interests of reducing uncertainty, to which my noble friend Lord Cormack referred, I look forward to the Minister’s comments on the teething problems in supermarkets mentioned by the noble Baroness, Lady Ritchie of Downpatrick.

[The Deputy Speaker (Lord Haskel) (Lab)]

I call again the noble and learned Lord, Lord Morris of Aberavon. No? I call the noble Baroness, Lady Suttie.

--- Later in debate ---

[Lord Lansley (Con) [V]]

My Lords, as the noble Lord, Lord Stevenson of Balmacara, said, this short debate follows on from the debate that we had in this House on the Trade (Disclosure of Information) Bill on 17 December. Like the noble Lord, Lord Stevenson, I am most grateful to the Minister for his letter of 4 January.

There are just two things that I want to say following on from that. The first is that I am grateful, but not surprised, that in his letter the Minister said that, although the wording in the amendments that we are now making to the Trade Bill varies slightly from the wording of the clauses in the Trade (Disclosure of Information) Act, the legal effect is exactly the same. I do not think we ever thought that the legal effect would be different. What we find somewhat surprising is that, to achieve the same effect at virtually the same time in two pieces of legislation, the wording is not the same. That was a slightly surprising aspect of the drafting that we were presented with when we saw the Trade (Disclosure of Information) Bill last month.

Secondly, I raised the question of what is meant by, and what is the purpose of, the amendments that put into the Bill the saving provision in Clauses 8 and 9 —that

“nothing in this section authorises the making of a disclosure which … contravenes the data protection legislation”

or aspects of the Investigatory Powers Act. The purpose of the government amendments is to ensure that, when these pieces of legislation and their constraints on disclosure are considered, Ministers can also take into account the powers conferred in this clause.

The Minister’s letter refers to the Supreme Court case of the Christian Institute and others v the Lord Advocate in 2016. I have had the chance to read the judgment and it does indeed refer to the situation where there is in effect, under legislative provisions such as the data protection legislation, a statutory gateway that allows those provisions to be escaped from in circumstances where there are powers for disclosure in other enactments. In the absence of these provisions, the data protection legislation and the Investigatory Powers Act might well make it very difficult for the necessary disclosures to be made in certain specific circumstances. Therefore, it allows for them to be seen together.

Paraphrasing, I think, the language of the Supreme Court, it is necessary for anyone wanting to understand the effect of this clause to have this legislation in one hand and the data protection law—indeed, I would add the Investigatory Powers Act—in the other. It does not tell you how any particular instance would be resolved but it does tell you that both must be considered together, and that is entirely reasonable.

The only issue that one is left with when one reads both the legislation and the Supreme Court judgment is that the clauses we are looking at do not say that the disclosures made by public authorities must be necessary and proportionate. Therefore, I think that it would finally close the gap and make matters very clear if the Minister would confirm that, where these disclosures are made, or indeed where further public authorities have information disclosed to them for their trade functions, the disclosures must be necessary and proportionate to meet those functions.

[Baroness Neville-Rolfe (Con) [V]]

My Lords, I welcome the government amendments, which are technical in nature but allow proper co-operation between HMRC and the devolved authorities. As I was not able to be in the House in person during debates on the Trade (Disclosure of Information) Act, I have probably not understood the purpose of Amendment 36A in the name of the noble Lord, Lord Stevenson of Balmacara—but I have a question that perhaps he or my noble friend the Minister could kindly respond to.

I always worry about the wisdom of giving a power to amend primary legislation by order, particularly on the collection or disclosure of information by HMRC, which seems to be the issue in Clause 7(4). As a former international retailer, I know how commercially sensitive such information is and how onerous ill-thought-out form-filling requirements can be. I want to make sure that the power could not be misused by the Executive—we have seen a certain amount of evasion of scrutiny during Covid. I want an assurance from the Minister, assuming that the power to amend primary legislation is retained in what is now being proposed, that the power would be used sensibly. If it disappears, then that would also meet my concern.

[Lord Purvis of Tweed (LD)]

My Lords, anybody seeking to follow this Trade Bill, including the Bill that we had before Christmas, will struggle to follow the three elements through a natural progression—but we are grateful to the noble Lord, Lord Lansley, for his forensic skill. He has been able to assist in the scrutiny of this, and the questions he asks are very valid. I am glad the noble Lord, Lord Stevenson, has brought forward his amendment, and I look forward to the response from the Government and the Minister. Like others, I welcome the Minister’s very full letter in response to the debate that we had on that fast-tracked piece of legislation.

There are a couple of areas that are still troubling me, and I hope the Minister will be able to explain those. I am happy with his explanation that it is purely a matter of parliamentary drafting, with the same legal effect. I will use this ad nauseam in my future career in this House, when it comes to any Ministers quibbling over the drafting of any amendments that I bring forward. I will say that it is purely drafting, with the same legal effect—so, speaking personally, I am very happy that that precedent has been set.

I am glad that the amendments to this Bill, which will effectively become the successor to the fast-tracked Bill, reference HMRC sharing information with the devolved Administrations. This goes back to the very first time we discussed these amendments, so I am happy and pleased that the Government have indicated their support for that.

However, I am interested in the language of Amendment 37, which I welcome, when it states:

“facilitating the exercise by a devolved authority of the authority’s functions relating to trade”.

Can the Minister outline what these are? In the previous group, on consulting the devolved Administrations on trade agreements, the noble Viscount, Lord Younger, was at pains to stress—and was accurate—that, under the Scotland Act and others, trade, as far as international relations are concerned, is a reserved matter.

However, we all know that there are “functions relating to trade” in the devolved Administrations; we know this for certain because it will be in the Bill. HMRC will facilitate the exercise of those functions by the powers under what will be this Act. I would be grateful if the Minister could outline what those “functions relating to trade” are; it would be helpful to us to know the extent of the Government’s position as regards what responsibilities for trade the devolved Administrations have.

Another thing still niggling me is referenced in the Minister’s letter. I have asked on a number of occasions why it was not more straightforward to put authorities that are linked with the ports and their access routes, in Scotland in particular, under those areas in the Bill. The Government have said that the powers were needed in England primarily, as the Minister’s letter stated, because those authorities were identified as the ones facing the greatest disruption at the end of the transition period, but this legislation is now for the long term and this data will also be shared with the WTO and other international bodies.

The Government have said that if it becomes necessary to add an authority in a devolved Administration country, they can use order-making powers to do it, but in subsection (4) there is a reference to an offence in Scotland for a non-existing authority breaching the disclosing information powers, and it carries a term not exceeding 12 months, so for a body that is not included in the legislation it is a 12-month prison sentence for disclosing information. That happens to be twice the length of time that it will now be in England, under government Amendment 40, which is six months. I do not know why that is the case, so perhaps the Minister can explain. There seems to be a ghost criminal offence created by this legislation that does not impact on anybody and is twice as much as it is in England. I just do not understand why.

I hope that the Minister can respond. I will certainly be supporting these amendments. The letter was very helpful and gave the process for indicating when the sunset clause will kick in for the legislation that we passed before Christmas, and given that this legislation is now for the very long term I hope that the Minister can respond to the points that have been raised.

United Kingdom Internal Market Bill

Baroness Neville-Rolfe Excerpts

Consideration of Commons amendments & Ping Pong (Hansard) & Ping Pong (Hansard): House of Lords
Wednesday 9th December 2020 Lords Chamber

[Baroness Neville-Rolfe (Con)]

My Lords, I share the feeling of the noble Baroness, Lady Finlay of Llandaff, and the noble and learned Lord, Lord Thomas of Cwmgiedd, that the Government have come a long way on this Bill, and I thank my noble friend the Minister for that. Noble Lords will recall that I had reservations about locating the Office for the Internal Market within the Competition and Markets Authority. I believe that it is the wrong place with the wrong culture, a point just echoed by noble Baroness, Lady Bowles. There is a practice of aggressive enforcement that is hardly suitable to some of the sensitive issues that it will be asked to investigate. I am concerned in particular that small businesses in those sectors that are not lucky enough to be excluded will be fearful and suffer relative to the way they are being treated at present in the EU single market. A formal discrimination is now being introduced between services that are in and those which are not included within Schedule 2. I therefore very much welcome the review being proposed in the government amendment. It is an idea that featured in an earlier amendment to which I added my name.

However, I have a question on the wording. Could that review look not only at the track record of the OIM panel and its task groups, which are mentioned in Clause 30, and its constitution as set out in Schedule 3, but also at the location of the OIM itself and whether it should be within the CMA or somewhere else? I ask this obviously without commitment, but it would certainly be helpful to know that the review would be suitably wide-ranging.

I rise also to express doubts about Motions L1 and L2. Many of us have been clear in the endless debates on this Bill that we should avoid a situation where a particular nation can veto important new measures that are in the national interest. The Government have, of course, wisely conceded that the devolved Administrations should be included as a statutory consultee and, of course, the views of all the four nations will be properly taken into account in that process. But I agree with my noble friend the Minister that we should not accept Amendment 50C. It risks a delay of up to three years in implementing a UK subsidy control regime because of the need for agreement with the devolved Administrations. The existing arrangements for spending decisions on subsidies under the devolved settlements will continue, so I strongly support the Government on this matter.

[Lord Liddle (Lab)]

My Lords, I make a brief intervention in the hope that the Government will listen to the wise words of the noble Baroness, Lady Finlay of Llandaff, and the particularly wise words of the noble and learned Lord, Lord Thomas of Cwmgiedd. We are at a delicate moment in our constitutional history. The future of the United Kingdom, with Brexit, is now in doubt. This will be the great issue of the next two years: can we keep the United Kingdom together? In that context, these are detailed matters, but the UK Government should go out of their way to ensure that those who want to break up the United Kingdom are not given just cause. I think that elements of the Bill and the Government’s position on it will be used in this way.

First, in the argumentation, I recognise that the Government have tried to strengthen consultation with the devolved Administrations in the amendments that they have put forward. So well done to the noble Lord, Lord Callanan, on that—we are to be thankful for that. But the line that state aid is a reserved UK matter and the devolved Administrations have never had any power over it will not go down well in Scotland, Wales and Northern Ireland. Wales and Scotland have had their development agencies. To tell the Welsh and Scottish people that these bodies have had no rights or independence to make decisions that promote economic development in their nations is very odd. To them, it looks as though the Government are taking away powers that they presently have. That is how it looks. The noble Lord shakes his head but, honestly, it is how it looks. Therefore, I think the Government should be bending over backwards to carry the nations of our United Kingdom with them.

I cannot understand the reasoning behind rejecting the proposal that has come from both Cardiff and Edinburgh to see if we can sort out, by consensus, a regime of state aid through a common framework. I do not understand how the Government can arrogantly say that this is something that we must control ourselves. It seems that the consensus for the future of the United Kingdom is much the best way forward.

The same applies to the argument about appointments to the body that is going to administer the new regime. The devolved nations should be treated as equals in this process. They should be able to nominate their own people to this body, not just be consulted. That is on the principle of equality between the nations and not appropriating to the UK Government, who, in my part of England, northern England, are seen as a London Government. That is how people look at it; it is not seen as a United Kingdom Government. I am sure that in Edinburgh and Cardiff it is not seen as a UK Government, particularly because of the Prime Minister we have. We have to bend over backwards to bring the nation together. Here is an opportunity, and I am very sorry that the Government appear to be wasting it.

Trade Bill

Baroness Neville-Rolfe Excerpts

Report stage & Report stage (Hansard): House of Lords & Report: 1st sitting & Report: 1st sitting: House of Lords
Monday 7th December 2020 Lords Chamber

[Lord Berkeley (Lab) [V]]

My Lords, in moving Amendment 1 I shall also speak to Amendments 4 and 5. The purpose of these amendments is to provide a legal basis for the Government to bring forward a statutory instrument to ratify the Luxembourg Rail Protocol. Noble Lords will probably remember that I spoke about and explained the purpose of this protocol in Committee. Very briefly, I remind the House that the Luxembourg Rail Protocol is a protocol to the Cape Town convention to reduce the risk for creditors, which in turn will reduce the cost of financing for new and current rolling stock.

An Oxera study published this week showed, I think, a saving to the rail sector of about £130 million per year. However, it is particularly important for the British rolling stock manufacturing community looking to develop new markets outside the UK, which I believe is one of the purposes of the Trade Bill. This rail protocol follows an older protocol on aircraft leasing and financing, which I think most people believe has been very successful in financing aircraft.

In Committee, the Minister replied that the Government support the ratification of the protocol. I am very grateful for the support of the noble Lord, Lord Grimstone, and the noble Viscount, Lord Younger, on this. Since they felt it was more appropriate to get the necessary legal basis through the private international law Bill, I agreed that I would not move my amendment. We had discussions with Ministers on the private international law Bill. I am once again grateful to Alex Chalk MP, the Justice Minister, and to the noble and learned Lord, Lord Stewart, for their help in drafting the new amendment to the PIL Bill when it came back to your Lordships’ House for ping-pong. I am grateful to the Ministers for their discussion.

During the debate the noble and learned Lord, Lord Stewart of Dirleton, agreed how important the rail protocol is to the industry but suggested that the application of the protocol was narrower than I might have thought, saying:

“The Government consider this to be an important issue and are thinking about how best to implement the protocol in the United Kingdom. As we discussed last week, we consider that the power in this Bill”—


that is, the PIL Bill—

“is too narrow to fully implement the protocol, although the provisions in applicable law would be within its scope.”—[Official Report, 19/11/20; col. 1574.]

That is very good but all it did was allow half the protocol to be implemented, which noble Lords will probably agree is not a good situation.

The Government appear to support the ratification of this protocol and to consider it important for the rail industry. However, I feel that I have been sent round the houses, from the Trade Bill to the PIL Bill, and now the Ministers have discovered that it will allow only half the protocol to be ratified. I was grateful for further discussions with the noble Lord, Lord Grimstone, by email recently, in which he suggested that

“the Trade Bill should not be expanded beyond essential readiness for trading as an independent country outside the EU.”

I would argue that this protocol would allow the rail sector to do just that. I think it would be very useful if it could be included.

The Minister again suggests that the Trade Bill is not an appropriate vehicle for matters relating to finance and transport, which should be considered elsewhere. If it were a matter of motor manufacture or printing-press manufacture, surely those would be trade issues as well. For motor manufacture, is the Department of Transport involved or is it a trade matter? That question must be resolved. Government lawyers from probably three different departments are dancing around a pinhead. This merry-go-round must stop because it is wasting a lot of government time, as well as Parliament’s.

I have been sent around the houses: transport, trade and justice, and now we are back in trade. I am very pleased to be back in trade this afternoon. Ministers say that they support the protocol to help achieve better trade in railway equipment, so in order to stop this merry-go-round, will the Minister urgently arrange a meeting with myself, the Department of Transport, the Department for International Trade and the Ministry of Justice if necessary? Will he then bring forward an amendment at Third Reading, which I assume and hope would be agreed across government, to enable the Luxembourg Rail Protocol to be ratified? Surely the Government can get their lawyers to agree.

If the Minister could commit to arranging such a meeting with me to resolve these issues and bringing forward an amendment at Third Reading, I would be very content. If not—and I hope it does not go that way—I am minded to seek the opinion of the House, if only to demonstrate the strength of internecine warfare in this Government on an issue that they all support but cannot work out how to deal with. I beg to move.

[Baroness Neville-Rolfe (Con)]

My Lords, I rise primarily to support the noble Lord, Lord Berkeley, as I did in Committee, in his efforts to get the Luxembourg Rail Protocol to the Cape Town Convention implemented in the UK. As we have heard, some steps have been taken, thanks to the good offices of the Minister and of Alex Chalk in the other place, but sadly they have not quite done the trick. I refer to my business interests in the register, including the UK-ASEAN Business Council, and a new role as chair of Crown Agents, which curiously, I find, did a great deal of work on rail and rolling stock during its long history.

I see two advantages to the protocol that was signed by the UK as long ago as 26 February 2016—obviously a very different world then. First, it will reduce the risk to creditors, which in turn will reduce the cost of financing new and current rolling stock—everything from engines to equipment and parts, data and manuals. Whether these are for a new line that is being built or for existing lines, by lowering creditor risk the protocol will assist in lowering the cost of new, more efficient, locomotives and wagons for freight and passenger transport. As the noble Lord, Lord Berkeley, has just said, an Oxera study to be published this week suggests a saving to the rail sector of about £130 million a year. This is quite significant when rail funding is under pressure, and particularly desirable as part of a move to net zero as we seek to combat climate change.

Secondly, it would help British rolling stock manufacturers seeking to develop new markets outside of the UK. There is an urgent need, for example in Africa, for more railway equipment both for urban transport—light rail, metro and trams—and for intercity rolling stock. The markets are there for British exporters, but the Governments and their operating agencies do not have the resources. I am talking about countries such as Namibia, Egypt, Ethiopia, Kenya, Uganda, Zambia and South Africa. The lack of resources has been a major constraint, and in a number of cases, operators have bought Chinese rolling stock instead, even when it is less suitable, because it comes with Chinese state-backed financing.

United Kingdom Internal Market Bill

Baroness Neville-Rolfe Excerpts

Report stage & Report: 3rd sitting (Hansard) & Report: 3rd sitting (Hansard): House of Lords
Wednesday 25th November 2020 Lords Chamber

[Baroness Noakes (Con)]

My Lords, as the Minister knows, I am a strong supporter of the Bill and believe that it is important to allow the UK’s internal market to function, but I genuinely believe that the location of the office for the internal market is problematic. I fully support the OIM itself, as it will be essential to monitor the effectiveness of the UK’s internal market. However, the CMA is the wrong place for it at the wrong time.

It is the wrong place because monitoring the internal market is a radically different activity from the core functions of the CMA. To oversimplify, the CMA is focused on businesses which can and do behave badly on competition. By contrast, the office for the internal market will not target individual businesses or sectors; its targets will end up being the Administrations of the devolved nations or their regulators if they act in a way that undermines the internal market. Businesses trying to trade throughout the UK should be the beneficiaries of the OIM’s work, not the villains. Most of the CMA’s battles are fought on legal and economic analysis, which are often big battles with a lot at stake but a world apart from the kind of political battle in which CMA may find itself pitted against one of the devolved Administrations.

In Committee, I said that putting two different activities into a single organisation ran the risk of that organisation being a jack of all trades and master of none. Having thought about that further, it is potentially worse. If the CMA and the OIM get embroiled in long political feuds about restrictions on trade within the internal market, it could be very damaging to the CMA’s focus, which may take away from the attention it gives to its core competition-based work. We may end up throwing the baby out with the bath water. It is also the wrong time to put the OIM into the CMA, given the significant increase in size as it takes on additional activities following our departure from the EU. Organisations that try to take on too much and do too many things at once often end up achieving very little.

For those reasons, I support creating the office for the internal market as a separate body. I cannot, however, support the amendment in the name of the noble Baroness, Lady Bowles of Berkhamsted, because it has gone beyond the simple purpose of setting up an independent OIM and has strayed into state aid, with its own version of how that may be taken on in future. That goes too far.

[Baroness Neville-Rolfe (Con)]

My Lords, I support the main thrust of the amendment, as I explained in Committee when leading a debate on my amendment, for which there was considerable support across the House. There is a good case for establishing a UK office for the internal market, but the CMA is the wrong home, for all the reasons that my noble friend Lady Noakes articulated so well. The CMA operates with values—notably a deep suspicion of the good business can do and an aggressive approach to enforcement—that are not appropriate to the new office.

Subsections (1) and (2) of the proposed new clause come from an earlier amendment which, frustratingly, was not moved, and are on the right lines. However, the proposed subsection (3) is not sensible. If any of the devolved Administrations withhold consent for appointments on whatever grounds, the whole purpose of the new office could be stymied. One is reminded of President Trump and the World Trade Organization, when unexpected and unforeseen actions by an elected officeholder—in this case, the President—in an advanced and democratic country came close to wrecking the operations of a major component of the global economic order. We would be foolish voluntarily to run such a risk.

It may be argued that it is unlikely the devolved Administrations will act like President Trump or that this is an issue of the same order. I would retort that, five years ago, it was deemed impossible by all informed observers that a US President would act as he has towards the WTO. Life can contain surprises, and we act foolishly if we unnecessarily set up arrangements that risk being sabotaged.

Accordingly, I call on the Minister to agree to bring forward an amendment at Third Reading that incorporates proposed new subsections (1), (2) and (5) of Amendment 68A, which seem entirely sensible and widely supported. I regret that I cannot support Amendment 68A as it stands.

[The Deputy Speaker (Lord Lexden) (Con)]

My Lords, I now call the noble Lord, Lord Flight.

United Kingdom Internal Market Bill

Baroness Neville-Rolfe Excerpts

Report stage & Report: 2nd sitting (Hansard) & Report: 2nd sitting (Hansard): House of Lords
Monday 23rd November 2020 Lords Chamber

Moved by

[Baroness Neville-Rolfe]

30: Clause 16, leave out Clause 16
Member’s explanatory statement
This probing amendment is intended to clarify the extent to which the Government has considered how the provisions of the bill in respect of services will work in practice.

[Baroness Neville-Rolfe (Con)]

My Lords, I seek clarification on the use of Clause 16 on services, on which hang the plentiful exclusions in Clause 17 and Schedule 2, and the related operation of mutual recognition, and of direct and indirect discrimination for services. I spoke to the amendment from the noble Baroness, Lady Hayter, in Committee but her concerns have been met by the interests of consumers being added to the objectives of the CMA in implementing this legislation by the Government’s judicious amendment to Clause 29, which we will touch on later, so I return to the charge alone. I refer to my interests in the register because of my involvement now and historically in various businesses, although I am not sure where their interests would lie.

The Government’s concession does not help to answer my questions about services, which are about the practical application of the services clauses. This is important because services make up over 80% of GDP, although I note that a large chunk—financial services, health and social services, legal services, transport, audio-visual and some others—are excluded from the reach of some or other of the clauses in Part 2. In a digital world, services are increasingly attached to goods, such as cars, white goods and smartphones, so the distinction between goods and services is also now blurred. Many service businesses sit outside London, including in the former red wall seats, and millions of them are small businesses—the sector closest to my heart for its innovation, dynamism and espousal of family values.

Services are at the heart of our economic success—it probably all dates back to the time when Napoleon accused us of being a nation of shopkeepers. However, they are also a mystery and ill understood, as I know from the excellent work we do on the EU Services Sub-Committee, of which I am honoured to be a member. Moreover, if you google services you find yourself lost between various motorway service stations and public services such as the NHS. It is our duty as a House to try to shine some light on this potentially confusing new area of law on services in the internal market.

Unfortunately, I do not really understand what Clause 16 and its associates are intended to achieve. I do not think I am alone in this. The Minister talked in Committee of the value of the non-discrimination rule and said that it is

“a fundamental safeguard for businesses, ensuring that there is equal opportunity for companies trading in the UK, regardless of where in the UK the business is based.”—[Official Report, 28/10/20; col. 357.]

But then there are exclusions on a major scale, suggesting that millions of businesses, and perhaps non-business entities, will not benefit from this principle.

--- Later in debate ---

[Lord Callanan (Con)]

I thank my noble friend for tabling this amendment, which seeks to clarify the extent to which we have considered how the provisions of the Bill in respect of services will work in practice. I shall endeavour to do my best to answer my noble friend’s concerns, because I know that she appreciates and promotes just how critical the services sector is to the United Kingdom, and I share that view. It is vital, constituting more than 80% of our GDP and four out of five jobs nationwide.

The principles of mutual recognition and non-discrimination in Part 2 underpin an internal market framework which will limit the emergence of new barriers following the return of powers from the EU. This will support UK businesses trading services in other parts of the UK, and authorities regulating these services. The Bill will complement the existing services regulatory framework while building in certainty for businesses and regulators.

The mutual recognition principle means that businesses authorised to provide services in one part of the United Kingdom will not need to satisfy further authorisation requirements to provide those services in the other parts of the United Kingdom. This principle of mutual recognition applies to authorisation requirements. It does not cover matters such as non-mandatory membership of organisations, which cannot prevent a service provider from offering a service but which might be desirable to join for other reasons.

A similar form of mutual recognition already operates as part of the existing UK-wide regulatory framework for services under the Provision of Services Regulations 2009. Regulators complying with that legislation will already be subject to the principle of mutual recognition. Similarly, the non-discrimination principle is a fundamental safeguard for businesses, ensuring equal opportunity for companies trading in the UK regardless of where in the UK that business is based, from where it provides services or where its staff are based.

As my noble friend Lady McIntosh highlighted, with the non-discrimination provision, regulators have until now had to follow rules in the Provision of Services Regulations 2009 which prevent discrimination towards service providers from other European Economic Area states. These rules will be revoked at the end of the year when the transition period comes to an end, as they will no longer be relevant to the UK’s situation. It is only right that rules that have previously prevented discrimination towards businesses from the other EEA states should now be applied to ensure the continued flow of services across our United Kingdom.

To help provide clarity, Clause 16 sets out a list of requirements and provisions that are neither regulatory nor authorisation requirements and therefore are not covered by the principles in Part 2. First, those requirements dealt with in other parts of the Bill—namely the mutual recognition principle in Part 1, which relates to goods, and provisions covered by Part 3, on professional qualifications—are not within scope of Part 2. This is because it is not desirable for one set of requirements to be subject to several rules from different parts of the Bill.

Secondly, existing requirements are out of scope because Part 2 applies only to new or substantively modified requirements that come into force, or otherwise come into effect, after this section comes into force. However, for the mutual recognition principle only, existing requirements will be brought within scope of the Bill where a corresponding authorisation requirement in another part of the UK introduces a new or substantively changed requirement.

Thirdly, a requirement which applies both to service providers and non-service providers is not in scope of Part 2. This part of the Bill is concerned only with the requirements which seek to regulate service providers and not all requirements which might affect service providers.

Finally, there are administrative requirements on service providers that we consider are reasonable in all circumstances, and therefore they are also not in scope of this part. Such administrative requirements could include, for example, where a service provider may be required to notify a local regulator of their presence, or where they are required to provide proof that they are in fact authorised to provide that service in another part of the UK. These requirements are necessary for regulators to continue operating effectively under the rules in this part, but it is our view that they are limited enough in scope so as not to create any unnecessary barriers to trade.

I can therefore assure my noble friend that the Government have considered carefully how the provisions in Part 2 will work in practice, and that Clause 16 is an essential part of their operation.

My noble friend asked whether penalties apply to businesses that are excluded from the Bill. If a given matter is out of scope of Parts 1 to 3, it is also by definition out of scope of the OIM’s functions and responsibilities.

My noble friend Lady McIntosh raised the four weeks’ consultation, as did a number of other noble Lords. The consultation followed the principles for a government consultation and represented an ambitious plan to engage businesses of all sizes across all four nations, as well as many academic experts and representatives of the devolved Administrations.

My noble friend Lady Neville-Rolfe asked also about Schedule 2, which lists a number of services with the aim of reflecting those outside the scope of the Provision of Services Regulations 2009, which is the current services framework. The Government also recognise that it is appropriate for legal services to be excluded from the provisions on the mutual recognition of services to reflect the separate legal systems in England, Wales, Scotland and Northern Ireland.

The noble Lord, Lord Purvis, asked whether service providers from the Isle of Man were subject to the measures in Part 2. The answer is no. Part 2 applies only to businesses and individuals that a have a permanent establishment in the United Kingdom as defined by the Corporation Tax Act 2010, which does not include of the Isle of Man. It is also the case for all Crown dependencies.

The noble Lord also asked when the services principles apply and when the goods principles apply. The services principles apply only where the goods principles do not. Only one set of principles will apply as to a particular requirement.

I hope that I have answered the questions of noble Lords and of my noble friend. I hope that she feels able to withdraw her amendment.

[Baroness Neville-Rolfe (Con)]

I thank noble Lords for an interesting debate and I am grateful for the support of my noble friend Lady McIntosh, the noble Baroness, Lady Bowles, and, of course, my noble friend Lady Noakes, who rightly pointed out the probing nature of this amendment, which I obviously do not seek to press. She also said that it was right that we include the services sector in the internal market, which is obvious from its very scale—a point that she, the noble Lord, Lord Stevenson, and the Minister emphasised—I think that it is about 80% of GDP. The Minister was also right to emphasise the value of mutual recognition and the loss of the EU-based services regulations of 2009, which to some extent we are trying to replace.

The single most important thing about the services element of the Bill, in Clause 16, is to understand the Government’s intentions, particularly in view of the minimal nature of consultation in framing it. My noble friend Lord Naseby was right to emphasise the importance and use of consultation. He also asked a question about the proposed registers which I am not sure we got a complete answer to.

The trouble is, we still do not know why these provisions are needed in individual cases—I gave some examples that I did not really get an answer to, such as hairdressers and other businesses—and why they vary from sector to sector. As the noble Lord, Lord Purvis, said, I am an optimist—I have been a strong supporter of the Government on this Bill against the advice of respected friends—but perhaps the Minister can kindly reflect on whether he can do anything further on services, with services now being so linked to goods as we have all agreed, to allay my fears. Some sectors, from property to restaurants, appear to face new regulations, possibly draconian, without much of awareness of it. The noble Lord, Lord Stevenson, suggested a letter outlining what was covered within the services sector. Perhaps the Minister could reflect a little further on how we might communicate this and reassure people about the value of these provisions in creating a single market with mutual recognition, which I strongly support. But we need to make sure that people understand what their duties are and that such duties are not overly draconian and will be sensibly enforced. I beg leave to withdraw the amendment.

Amendment 30 withdrawn.

--- Later in debate ---

[Baroness Neville-Rolfe (Con)]

My Lords, I thank my noble friend Lord Callanan for his amendments, which, as many have said, represent a real readiness to listen. The changes all seem very sensible, especially the proposal for the CMA to lay an annual plan before Parliament and before the devolved legislatures. Perhaps a similar procedure could be derived in relation to the common frameworks, over which there has been so much grief and debate. In my experience, when things go well, such reports become routine and are not even debated, but they are a good way of keeping the Executive —public servants, any boards involved and the Ministers they serve—objective, efficient and thoughtful.

However, I am afraid that I do not support Amendment 54. Board members of the CMA should not be “representative” of a territorial interest in the way this would inevitably turn out. The interests of the four nations should be taken into account in coming up with a balanced, objective board, but this is not the right way to do it. My noble friend Lady Noakes summarised the balance issues very well from her own wide experience. The amendment would also jeopardise the very objectivity and pursuit of the public interest which is vital to a better CMA.

By the way, Tesco’s head office is not in London; that was a bad example for the noble Baroness, Lady Randerson, to choose. At least in my time, we had a very high degree of sensitivity to Welsh issues, sold more Welsh food elsewhere in the UK than anybody else, and indeed from time to time had Welsh individuals of great independence sitting on the board.

[Lord Fox (LD)]

That is just proof that you can take the Peer out of Tesco but not Tesco out of the Peer.

My noble friend Lady Randerson hinted that she thought the Minister might be developing emotional intelligence—or perhaps we will see signs of that later. However, I think that most of your Lordships have welcomed the government amendments in this group. They are showing movement in the right direction and are an improvement on what you would expect those of us on these Benches to condemn as a deeply flawed Bill.

My noble friends Lady Bowles and Lord Bruce both made the point about where the OIM is and its presence in the CMA. We are not debating that in this group, although we will be some other time. However, Amendment 54 and consequential Amendment 59 should be seen as the safety belt in the event that the OIM remains within the CMA.

The noble Lord, Lord Naseby, made a powerful speech against Amendment 54. I did not see him in his seat when the noble and learned Lord, Lord Thomas of Cwmgiedd, was giving his strong endorsement of his amendment. He may have been oscillating somewhere between virtual and physical; if he was, I apologise. In his speech, the noble and learned Lord, Lord Thomas, put forward a very important point. The CMA is getting considerably more powers as a result of the Bill. The point he did not make but inferred is that those powers move from being reserved powers to those that step into the realm of devolved powers—there can be no doubt about that.

There is therefore a significant change in the nature of the task that the CMA is overseeing. The Government may say it is too much trouble to change the nature of the governance of the CMA, but its focus is changing from reserved issues to those which cover devolved matters, so that change should be reflected in its governance.

My noble friend Lord Bruce talked about unintended rather than intended consequences. The Government need to create a board that can reduce the number of unknown unknowns that it encounters. Amendment 54 is a perfectly reasonable amendment, which would make sure that there are people on the board who understand the nature of the markets in the devolved countries.

To take the point made by the noble Baroness, Lady Noakes, one would hope that the careful construction of a board would understand the need for that. I have to tell your Lordships—and perhaps the principles of my noble friend Lady Bowles could be passed to some Cabinet members—that the construction of boards and organisations over the course of the last 12 months has been nothing like a careful assembly of the right people. It has been a gathering of friends and known people to do the bidding of the Secretary of State. Therefore, it is right for the opposition to be very suspicious about the future board of the CMA, which will have this extraordinarily bumped-up role. That is the reason for Amendment 54 and also for consequential Amendment 59.

The noble Baroness, Lady Noakes, is correct. In a sensible world, what she suggests would happen. However, we cannot trust that to go forward, and trust is going to be very important with regard to the devolved authorities and how they work with the CMA if, indeed, the office for the internal market is located within it.

The noble Lord, Lord Wigley, the noble Baroness, Lady Finlay, and my noble friend Lady Randerson gave wise advice: rather than politicise the CMA, this is helping to inoculate it from political suspicions. That is why, if the noble and learned Lord, Lord Thomas, seeks to put it to the House, we Liberal Democrats will support Amendment 54.

United Kingdom Internal Market Bill

Baroness Neville-Rolfe Excerpts

Report stage & Report stage (Hansard): House of Lords & Report: 1st sitting & Report: 1st sitting: House of Lords
Wednesday 18th November 2020 Lords Chamber

[Baroness Neville-Rolfe (Con)]

My Lords, I speak to this group of amendments in the name of my noble friend Lady McIntosh of Pickering and the noble Lord, Lord Foulkes of Cumnock, applying a super-affirmative resolution procedure to changes to the reach of Clause 8 on indirect discrimination on services— the goods, equivalent and various other clauses having fallen. Amendment 9 requires publication of the results of consultation and reasons for decisions reached, and Amendment 74 tries to overcome the Minister’s objection to the super-affirmative procedure on the grounds that it could cause needless delay, by providing for rapid approval in cases of urgency.

I agree with the need for consultation and explanation, but I am not sure that this needs to be in the Bill. There should indeed be an opt-out in cases of urgency, but only if this route were to find favour with our House. However, I do not believe that the case has been made that the super-affirmative procedure is needed, certainly not on the scale proposed and in the light of the amendments already made by the Government in respect of mutual recognition of goods.

I echo what the noble Lord, Lord Foulkes, said about the Minister’s readiness to listen to the experts in this House and to make changes to make this legislation work. I was involved in securing the procedures used very selectively in the withdrawal Act, when the then Minister, my noble friend Lord Callanan, was very helpful. I am a practical person, and I have not seen any real evidence here of the need for the use of the super-affirmative procedure. We need much more specific and concrete concerns to justify my noble friend Lady McIntosh of Pickering’s amendment. If the proposers of the amendment are just fearful, that is not enough to merit the super-affirmative procedure.

Perhaps the Minister can provide examples of how the powers in the clauses will be used and, perhaps more important, why he believes that the super-affirmative procedure is over the top in this case. That would sit on the record, Pepper v Hart style, and minimise the risk from the use of the powers in the Bill.

[Lord Naseby (Con)]

My Lords, given my five years in the Chair in the other place, noble Lords will not be surprised that I had a closer look at the super-affirmative procedure, where it has been used and where it should be used.

First, we all acknowledge that this is a very important Bill, which is why there is an affirmative resolution procedure in various clauses. We start with that. Secondly, as noble Lords have said, the super-affirmative procedure involves an additional stage of scrutiny where Parliament considers a proposal for a statutory instrument before it is formally presented—what we call laid. This procedure is used for statutory instruments that are considered to need a particularly high level of scrutiny. That is self-evident, I think.

I then checked where they had been used. The statutory instruments used so far usually amend or repeal Acts of Parliament. Examples would include legislative reform orders, localism orders, public bodies orders, regulatory reform orders and remedial orders. Although I have had only a short time to do it, I have not found it within primary legislation—I stand to be corrected, but I have not found it myself. Indeed, listening to my noble friend proposing that this procedure should be used, it seemed to me that it was a sort of grapeshot approach, scattered throughout the Bill, suggesting that all the bits in these amendments are absolutely vital and must be taken specially. I just do not think that stacks up.

Furthermore, because this Bill is important, and because we are dealing with devolved powers who will be consulted and worked with, it will just add further delay. That is not in the interests of Parliament, business, commerce, or the people of the United Kingdom. So quite frankly, I certainly will not be supporting this at all—I think it is almost out of order.

--- Later in debate ---

[Baroness Jones of Moulsecoomb (GP)]

My Lords, I will be brief. The amendments in the group are basically about protecting the environment, consumers and public health—all legitimate aims. The noble Lord, Lord Randall, made a good point when he said that, given the Government’s U-turn or swerve towards green issues, these amendments can be helpful. I see no problem with the Government picking them up and saying thank you. One problem with the Bill as it stands is that they are trying to create a legal system more restrictive and overbearing than the EU single market ever was. The amendments reintroduce existing exceptions in EU law that allow the Government to pursue a sensible policy that will benefit people and the planet.

One of the delights of my experience here in your Lordships’ House at the moment and over the past 18 months has been that I am not the only person banging on about the environment any more. I would like to thank everybody who has written these amendments; I support them thoroughly and I hope that the Government see them as helpful towards their green aims.

[Baroness Neville-Rolfe (Con)]

My Lords, I must say that I am uneasy about this group of amendments because I am not sure that they achieve what many noble Lords want. This Bill is designed to provide a UK single market—like the EU’s and, indeed, that of the USA—to ensure a properly functioning market that creates prosperity and economic security for our four great nations coming together in the United Kingdom under Her Majesty the Queen.

We want trade to flourish, and we want to support business interchange and the free flow of information. This helps the devolved nations, as 60% of exports from Scotland and Wales and nearly 50% from Northern Ireland go elsewhere in the UK and they all benefit greatly from a transfer of resources, mainly from London. We want trade to increase as we see more import substitution following exit from the European Union.

Public policy can be decided within that internal market framework with some variations; we have talked about that before. I support local variations, such as minimum alcohol pricing in Scotland and plastic bag regulation in Wales, which I encouraged. However, they must be limited or the single market will be undermined. Adding consumers, the environment, labour standards, public and animal health, cultural expression, regional characteristics and equality in various ways, as these amendments do—even with an opt-out where the relevant aim is already achieved, as in the amendment in the name of the noble Lord, Lord Stevenson—changes the whole character of the legislation on non-discrimination and market access. I note the contribution of my noble friend Lord Young of Cookham but I do not see how different rules on smoking, minimum pricing or the use of the Welsh language, which I very much support, would be ruled out by this Bill.

As for differential labelling, whether on crisp packets or anything else, I know from experience that having different labels adds costs and introduces logistics issues, which puts prices up for consumers. It would be much better to introduce labelling for health reasons and significant climate change reform for the United Kingdom in the way it used to be agreed in Brussels. I fear that these undoubtedly well-meaning amendments would provide a plethora of excuses to impose protectionist and other barriers between our four nations.

A source of dispute, not collaboration and harmony, across our land and a field day for the legal profession would not help us to achieve the leaps forward that we all want on the environment, standards or anything else that has been the subject of this debate.

[Lord Teverson (LD) [V]]

My Lords, I will speak to Amendment 11 in the name of the noble Baroness, Lady Boycott, although I am very much in favour of the amendments in the name of the noble Lord, Lord Stevenson, as well.

Devolution has not been a disaster in Scotland, Wales, Northern Ireland or, indeed, London. It has strengthened the United Kingdom, our economy and our society. My great fear is that the overwhelming application of the market access principle—with those few exceptions: life or health of humans, animals and pets or public safety and security—is far too restrictive and will mean that important parts of devolution erode and disappear over time.

As with Amendment 11 in the name of the noble Baroness, Lady Boycott, I am particularly concerned about the environment, including climate change. I will be brief on this. We heard arguments in Committee that the most important thing was maintaining strong competition in the United Kingdom. I agree with that, but, like all things in market economies, that needs to be constrained in certain ways. While we need market competition to remain strong, it is equally important in a modern economy that innovation can take place. Competition in environmental regulation and some of these other areas is equally important to stimulate innovations in the nations of the United Kingdom that others can follow when they are successful. I see that as a key part of this process: being able to keep at the same time the different ways in which the nations of the United Kingdom can interpret environmental and climate change needs.

I am delighted that the Minister responding is the noble Lord, Lord Callanan, who is the Government’s Minister for Climate Change. I am sure he will be absolutely persuaded by these arguments that we need these environmental innovations to help with climate change as we move forward—as the Prime Minister wants us to, as he showed in his 10-point plan today—and to make sure we keep that progress and do it in the many ways the nations of the United Kingdom wish.

Competition (Amendment etc.) (EU Exit) Regulations 2020

Baroness Neville-Rolfe Excerpts

Monday 16th November 2020 Grand Committee

[Baroness Neville-Rolfe (Con)]

My Lords, I start by supporting an intelligent policy on competition. As Ovid, one of my favourite classical writers, said:

“A horse never runs so fast as when he has other horses to catch up and outpace.”


When one gets fed up with the sheer scale of Amazon, one ought to remember this wisdom.

I will always be grateful to the CMA in its previous guise as the Office of Fair Trading, because it took a case that brought us over-the-counter medicines. These have been a huge boon that we would never have had without its brave fight against the medical and pharmaceutical vested interests—a huge consumer benefit worth billions in recent years.

However, over the years, the competition authorities, using the existing powers to which my noble friend the Minister referred, have had a tedious obsession with the inequities of the latest tall poppy, usually shortly after the temporary period of monopoly profits has passed. I have seen that in my life several times—with the brewing sector, now a fraction of its one-time status thanks in part to the counterproductive beer orders; in ice cream; in dairy, where we still struggle to compete with European cheese and yoghurt manufacturers; and in supermarkets where, during repeated inquiries, the shops’ profits were shown to be a fraction of those in regulated industries such as utilities and/or in banks before the crash. True to form, the banks were finally investigated after the devastation of the financial crisis. Even so, I believe that small banks still operate at a disadvantage, although I am glad to see that Sam Woods, deputy governor at the Bank of England, is examining ways of lightening their burden.

I should refer to the register and my interest as a director of a small bank and a shareholder in Tesco and Amazon, although I am better known for my passion for small business dynamism, fuelled by competition, because it underpins a strong economy. I like to speak up for business when I can, because it pays and collects the taxes that nearly all pay and which in turn pay for almost everything in the public sector, and it provides many productive jobs.

Against this background, I thank the Minister for his clear explanation of the amending SI, including the way current EU cases will be treated and any follow-on damages. I look forward to his answer to my noble friend Lord Lansley’s question about vertical agreements, market share and the National Security and Investment Bill—though I think that is for another day—and my noble friend Lady McIntosh’s question on roaming charges.

As a result of an SI last year, and this one, the CMA will have even more powers than before Brexit, and in theory will be able to exercise a chilling effect in even more areas. I worry that it will be able to impose its huge fines in relation to even more aspects of competition law. We are talking here about British businesses trying to make a living and get through Covid without sacking too many staff.

Although this is not directly relevant today, perhaps I could say in passing that I do not agree that some fines should be increased, as the noble Lord, Lord Tyrie, hinted in Committee on the United Kingdom Internal Market Bill. I suspect he has less experience than I do of being on the business side of an argument with the regulator, and has little idea how terrifying it can be and how distracting for management.

I believe in competition, so in the round I support the CMA, but it has to have the right culture. Can the Minister comment on how best we can achieve that in the new post-Brexit era? The new chair will also be important, and perhaps he can update us on that appointment.

Further, does the Minister accept that we need to look at competition matters through the prism of the national interest? I have been struck by how other member states do this, and I am sure we will see more protectionist competition policies in Brussels now that we have left. I used to have tussles in the Competitiveness Council on the drift to protectionism, which I opposed. That was especially so with the French—their representative was usually a young, good-looking and very persuasive sometime banker called Emmanuel Macron—and with the German Minister, who represented one of the socialist elements in the German coalition. They were keen to erect barriers to help their tech and telecoms sectors. History shows that that is an ineffective strategy.

Finally, does my noble friend agree that we need officials who are skilled and well motivated at the CMA, and who understand the importance of not being both judge and jury? We need a good mix of talent with the right values, objectivity, economic awareness and understanding of data—and not too many from magic circle legal firms here, and their equivalent overseas, bringing their MoJ-style ways, sometimes making a mess and then moving quickly back to private practice.

I do not object to the regulations, but I would like to know how the Government will ensure that all parts of the CMA are well run and effective and, as I said earlier, operate in the national interest in the post-Brexit world. As the Minister said in his opening remarks, we will have a sovereign regime, and we must make a success of it.

United Kingdom Internal Market Bill

Baroness Neville-Rolfe Excerpts

Committee stage & Committee: 5th sitting (Hansard) & Committee: 5th sitting (Hansard): House of Lords
Monday 9th November 2020 Lords Chamber

[Lord Garnier (Con) [V]]

My Lords, unlike the noble Baroness, Lady Fox of Buckley, whose vigorous reasoning I respectfully reject, I will be voting to remove Clauses 42 to 47 from the Bill. I am privileged to follow the noble and learned Lord, Lord Judge, my noble friend Lord Howard of Lympne and many other noble Lords from all parts of the House who have deprecated Part 5.

The noble and learned Lord, and those who have supported him so far, advanced compelling arguments that appeal both to my head and my heart. The arguments of the noble and learned Lord, Lord Judge, were precise, they were clear, they were right, they were devastating—and they left no room for contradiction. I agree with him.

At Second Reading I regretted the inclusion of Part 5 in the Bill. To repeat at length what I said then will not make any difference to the quality of my arguments, good, bad or indifferent, although I have subsequently discovered that my views were thought by some, although not all, close to the Government to be—let me say—extravagant. If that is what they think they are free to do so, although I have not usually found this Government’s closest advisers to be quite so delicate when they are offering their views. I hope I can tell the difference between a row and an argument—and I am advancing an argument.

At Second Reading, I did no more than advance some orthodox and widely accepted arguments against the inclusion of Part 5 in the Bill on rule of law grounds. I do so again. I also noted that the arguments put forward in and out of Parliament by the Government and their supporters for the inclusion of these clauses were risible and unconvincing. They still are. Like my noble and learned friend Lord Clarke of Nottingham, I am disappointed that nothing has changed. The proponents of Part 5 are beginning to look like post-revolution Bourbons.

Maintenance of the rule of law domestically and internationally by any United Kingdom Government, or breaking a treaty passed into British law, is no small thing and cannot lightly be tossed aside as though of no account or merely a matter of tactics in a negotiation. Moreover, denying the people access to the courts and independent judicial arbitration of disputes, or giving Ministers untrammelled executive power, cannot be acceptable. Part 5 does all these things. Eliding the sovereignty of Parliament with the international law obligations of the Government is both a confusion and a delusion. Passing the decision on when to break our legal obligations from the Executive to the legislature makes no difference and provides neither defence nor mitigation. I do not resile from a word I said at Second Reading.

No one in agreement with the noble and learned Lord, Lord Judge, is so naive as not to understand the political imperatives driving this Government in relation to Part 5, although they are imperatives of their own making, flowing directly from a treaty they freely entered into and passed into UK law within the last 12 months. This has no parallel with the European example cited by my noble friend Lord Lilley, as simply explained by the noble Lords, Lord Pannick and Lord Carlile.

I also know that the author of Part 5, our modern-day Thomas Cromwell, as I implied at Second Reading, is not on the Government Front Bench in your Lordships’ House. I entirely accept that my noble friends, as Ministers bound by collective responsibility, have no discretion or room for manoeuvre in government. I, on the other hand, am fortunately free to acknowledge some different responsibilities—to the rule of law principles that guide me as a member of the Conservative Party, as a legislator, as a lawyer and as a former law officer. I cannot in conscience support these clauses; they must come out of the Bill.

[Baroness Neville-Rolfe (Con)]

My Lords, I am glad to speak after my noble and learned friend Lord Garnier, although we come at the subject from slightly different directions. I have sat through much of the proceedings on this Bill. I have quite a few reservations, which I hope may be reflected in amendments or reassurances on Report. However, on Part 5 I have a great deal of sympathy with the Government and I thought my noble friend the Minister summed it all up very well in his statesmanlike speech at Second Reading.

The Government have come forward with safety net measures in domestic law that allow Ministers to protect the UK’s internal market, our union with Northern Ireland and the Northern Ireland peace process, but only if needed. There will be a vote in the other place before these are used, and any SI will be subject to affirmative resolution. To pick up on something the noble and gallant Lord, Lord Stirrup, said in a strong speech, it is now half way to that oven-ready Bill-in-waiting that he felt would have attracted much more sympathy across this House.

Of course, had everything worked smoothly in the exit negotiations, had the EU acted in those negotiations as though dealing with close friends and allies, had the previous Administration been more nimble in defending the UK interest, and could everything be guaranteed to continue to work smoothly, there would be no need to adopt the provisions in Part 5 to which many take exception. Unfortunately, none of those possibilities has yet proven to be the case. Accordingly, as my noble friend Lord Hunt of Wirral and the noble Lord, Lord Skidelsky, said at Second Reading, we should not tie the hands of the Government at this time. We should give them the elastic they need.

I am grateful for the work of the EU Committee, on which I have the pleasure to sit and support the noble Earl, Lord Kinnoull, and the work of its excellent staff on the complexities of the Northern Ireland situation and its special protocol which has helped to inform our debates. The problem—and the reason the Government are seeking the powers in Part 5—stems, I believe, from the unsatisfactory nature of the withdrawal agreement, but only if the EU were to take a disreputable and irresponsible stance. Unfortunately, that possibility cannot yet be entirely excluded. Such a development would make life very difficult for those businesses which operate in Northern Ireland and for goods and food coming in and out over either border. Indeed, today’s debate and the arresting contributions from the noble Baroness, Lady Hoey, and the noble Lord, Lord McCrea of Magherafelt and Cookstown, have heightened my concern about the risks to the Northern Ireland economy and the Belfast agreement.

The joint committee has wide powers to prepare for and sort out any mess but, regrettably, it has not done so. Perhaps it has no intention of doing so while vital and delicate discussions on an FTA continue. Perhaps my noble friend the Minister can report on discussions in that joint committee, where there are concerns or disagreements and whether there is any hope, even now, that the difficulty will be overcome so that the Part 5 provision will become unnecessary.

With the promoters of these amendments having demonstrated their nobility of mind in the earlier discussions at Second Reading, I was hoping for a full discussion in Committee of the wide-ranging powers being taken in Part 5 and not just a rerun of the debate of principle of 20 October. The noble Lord, Lord Pannick, touched on this in his speech and I am sure my noble friend the Minister, when he responds, will address some of our concerns about the breadth of the power. But, today, I think we should celebrate the fact that there was a startling breakthrough on a coronavirus vaccine. I have some hope that there will also be a breakthrough on the FTA with the EU and that Part 5 will not now be needed. In the meantime, I will be supporting the Government.

[Lord Ricketts (CB) [V]]

My Lords, I apologise that I was unable to participate in the Second Reading debate. Many noble Lords this evening have set out with great power and authority the legal, constitutional and moral objections to this Bill. My purpose in speaking is to take a slightly different tack—which may be a good thing at this point in the debate—and to look at the operational damage that Clauses 42 and 47 of this Bill, if enacted, would do to the effectiveness of our foreign policy.

I do that on the basis of 40 years of experience representing this country as a British diplomat. I know at first hand that Britain has been widely respected around the world as the country that evolved the concept of parliamentary democracy and the rule of law and has played such a formative part in developing the body of international law as we now have it, from the Geneva conventions on the laws of war to the International Criminal Court.

My point is that this is more than an issue of the country’s reputation. Our power of example has strengthened our powers of influence in the world. It has given our country the authority to demand that other countries uphold their international obligations. It is part of the reason, for example, that Britain has been able to play such a leading role in the UN Security Council in crafting countless resolutions, holding to account those who break their international commitments and often imposing sanctions on them.

As other noble Lords have said, we are now standing on the cusp of a new American presidency, with a President-elect who is a passionate believer in the rule of law and in resolving disputes between countries through agreement. There is a great deal of important work that we can do together. An early priority with the Biden Administration should be to bring Iran back into compliance with the agreement it signed with the US, the UK and others in 2015. But how can we preach to Iran what we do not practise at home? It would be the worst possible start to the British partnership with a Biden Administration intent on rebuilding institutions of the rule of law if the Government now plough ahead with Part 5 even after Mr Biden has explicitly warned of the dangers. In response to the noble Baroness, Lady Hoey, this is not about pleasing a new US President; it is about effective co-operation with a country that is now, once again, intent on helping to resolve the world’s problems through international agreement.