Economic Activity of Public Bodies (Overseas Matters) Bill

Baroness Noakes Excerpts

Committee stage
Tuesday 14th May 2024 Lords Chamber

[Lord Hendy (Lab)]

My Lords, in the unavoidable absence of my noble friend Lady Blower, and at her request, I beg to move Amendment 30, which is intended to add to paragraph 6 of the schedule.

The paragraph, which we discussed in Committee last week, permits a decision-maker to take into account whether the decision might put the UK in breach of its obligations under international law. In the last debate, we discussed the nature of the international law obligations comprehended in this paragraph and the question of who determines whether there has been a breach of them. I do not seek to reopen that debate; this amendment is not dependent on the outcome of it.

The amendment would make it clear that the decision-maker will be permitted to take into consideration and reject a tender or an investment that the decision-maker reasonably considers might put the UK in breach of its obligations under the genocide convention, the Universal Declaration of Human Rights or any UN Security Council resolutions supported by the United Kingdom. The amendment would still stand and have force, whether or not the Government accept amendments along the lines suggested by the noble and learned Lord, Lord Etherton, and the noble Lord, Lord Verdirame, identifying what entity appropriately determines what amounts to a UK breach of international law. Amendment 30 merely clarifies that the conventions and resolutions mentioned in it are to be regarded as UK obligations.

I find it impossible to see what conceivable objection there could be to identifying matters of such grave importance to a law-abiding nation. The rationale is so obvious that I cannot think of anything more to say in support of my noble friend Lady Blower’s amendment, and I look forward to hearing that the Minister will support it.

I will now speak to Amendment 32. Paragraph 8 of the Schedule permits the potential decision-maker on procurement to take into consideration certain forms of “labour-related misconduct”. The problem is that that is a very limited list. We touched on that in Committee last week. In the last debate, the Minister asked me to provide further details on whether the violations of core labour standards would be covered by the provisions of paragraph 8. I looked at that matter again and did not take up her kind invitation to write to her, because Amendment 32, which was not before us last week, makes clear the distinction between the core labour standards identified in the amendment and the standards set out in paragraph 8.

I will explain. Paragraph 8 is confined only to conduct that would amount to a criminal offence in relation to slavery or human trafficking orders, failure to pay the national minimum wage and labour market orders under the Immigration Act. That list does not currently permit those making procurement and investment decisions to have regard to the fundamental labour standards binding on all countries by virtue of their membership of the ILO. As a matter of convenience, we can take those standards from Articles 399(2) and 399(6) of the trade and co-operation agreement—the Brexit deal—signed by our then Prime Minister in 2020, where they are conveniently summarised.

The provisions commit the UK to respect, promote and effectively implement the ILO Constitution, which includes the Declaration of Philadelphia of 1944, the

“ILO Declaration on Fundamental Principles and Rights at Work and its Follow-up, adopted at Geneva on 18 June 1998 … the ILO Decent Work Agenda as set out in the 2008 ILO Declaration on Social Justice for a Fair Globalization”,

and the fundamental ILO conventions. The fundamental ILO conventions are those identified in those provisions of the Trade and Cooperation Agreement and in the amendment. They protect freedom of association and the effective recognition of the right to collective bargaining; the elimination of all forms of forced or compulsory labour; the effective abolition of child labour; the elimination of discrimination in respect of employment and occupation; decent working conditions for all with regard to, inter alia, wages and earnings, working hours, maternity leave and other conditions of work; health and safety at work, including the prevention of occupational injury or illness and compensation in cases of such injury or illness; and, finally, non-discrimination in respect of working conditions, including for migrant workers.

The only point in that list which is included in paragraph 8 of the Schedule is the second point that I mentioned: the elimination of all forms of forced and compulsory labour. That is the only point at which my amendment and paragraph 8 coincide, because paragraph 8 of the Schedule deals with slavery and trafficking. However, all the other elements of the fundamental labour standards are outside paragraph 8, even though they are binding on every country which is a member of the ILO by virtue of its membership and, regardless of whether they have ratified these conventions, they are matters of customary international law. These are vitally important standards, as the UK government representatives will doubtless reiterate at the International Labour Conference of the ILO, which takes place in June.

Plainly, paragraph 8 does not go far enough. International labour standards are important for ameliorating the conditions of workers in less developed and authoritarian regimes, and, from a more self-interested perspective, for diminishing the extent to which UK manufacturers and UK suppliers of services and works are undercut by competitors seeking to, as I put it on the last occasion,

“exploit cheap labour, poor conditions, inadequate standards, lack of enforcement, and powerless trade unions”.—[Official Report, 7/5/24; cols. 23-24.]

I refer to the examples I gave on the last occasion, but I will not repeat them.

Reverting to the point made by the noble and learned Lord, Lord Etherton, and the noble Lord, Lord Verdirame, on the last occasion, identification of whether there has been a breach of a fundamental ILO convention is not here left to the lay opinion of the decision-maker in the public entity. The ILO has extensive and long-established machinery for determining whether each state is in conformity with each of the fundamental conventions and each of the conventions that state has ratified. The UK fully participates in that machinery and those determinations. Why, then, I ask rhetorically, should the minimum standards of the fundamental international labour conventions, which are all ratified by the UK, not be included in the list of legitimate labour-related misconduct which procurement decision-makers can take into account under the Bill? I wait with anticipation to see whether the Minister will seek to justify their exclusion.

[Baroness Noakes (Con)]

My Lords, when we debated paragraph 6 of the Schedule in an earlier group, I argued that it was inappropriate to include an international law exception in the Bill. Therefore, it will not surprise the noble Lord, Lord Hendy, to find that I do not support the extension to paragraph 6 that his Amendment 30 seeks to achieve.

The briefing sent by the Palestine Solidarity Campaign asserted that without this amendment, the Bill could compel public bodies to contravene the genocide convention. This extraordinary statement was explained in the context of the much-publicised opinion of a number of UK lawyers, including the noble and learned Baroness, Lady Hale, that the International Court of Justice had ruled that there was a plausible case that Israel has committed genocide. As the then President of the ICJ subsequently made clear, this is a complete misinterpretation of the ICJ’s judgment. Judge Joan Donoghue, the then President of the ICJ, has stated that the court decided that the Palestinians had a plausible right to be protected from genocide and that South Africa had the right to present that claim in court. However, to correct something that is often said in the media, the court did not decide that the claim of genocide was plausible. So the items of international law referred to in the amendment, including the genocide convention, basically have the name “Israel” etched on them. Whether by design or otherwise, this amendment would simply make it easier for public authorities to find excuses to boycott Israel and it would be very damaging if this amendment were accepted into this Bill.

Amendment 32, tabled by the noble Lord, Lord Hendy, raises rather different issues. I am conscious that I am in dangerous territory because of the acknowledged expertise in labour law of the noble Lord compared with my ignorance of labour law. However, it is my understanding that the ILO conventions do not have direct effect in the UK. I thought that we achieved compliance through our domestic legislation. The noble Lord spoke about ILO matters on the last Committee day and, while he made the point that the UK is bound by the ILO conventions, I do not think that he claimed that they had any direct effect in UK law.

If I am correct, this amendment is a very unwelcome addition to the Bill because it seems to give full legal effect to the ILO conventions directly. These conventions are not drafted as stand-alone laws but in rather broad terms. They lack a lot of definitions and the language is often rather vague. That is why national Governments have to adopt them using their own legislation. I am not speaking against the ILO conventions; I have no views one way or the other on the conventions. My point is that we comply with these conventions through our national law and that law is the foundation of labour-related misconduct, which is covered in paragraph 8. It seems to me that paragraph 8 means that we can hold overseas suppliers to the same standards to which we hold UK suppliers. In particular, it aligns with the provisions of the Procurement Act which was passed last year. That is a wholly proper basis for this Act, rather than some broader concept of principles that cannot be read directly into our law.

[Lord Verdirame (Non-Afl)]

My Lords, I rise to offer a few remarks on these two amendments.

Amendment 30 does not really extend what paragraph 6 already does, because the expression “international law” in paragraph 6 includes everything that Amendment 30 mentions. My criticism of it, aside from the points that were discussed on day 3, is that it is just redundant. “Convention” is just another term for “treaty” and “obligations under international law” will include obligations arising under treaties to which the United Kingdom is a party. They will obviously include the genocide convention. The Universal Declaration of Human Rights is not a convention or a treaty but a resolution of the General Assembly, but it is widely believed to reflect customary international law and so is binding on the United Kingdom.

The reference in the amendment to the Security Council resolutions is also unhelpful and confusing. Security Council resolutions will be binding on the United Kingdom provided that they contain decisions under Article 25 of the United Nations charter, because it is the decisions of the Security Council that are binding on member states. Those resolutions will be binding on the United Kingdom, whether we supported them or whether we abstained in those votes.

--- Later in debate ---

[Lord Davies of Brixton (Lab)]

I shall follow the line taken by the noble Lord, Lord Beith, who quoted from the Government’s Explanatory Notes. This is the House of Lords wording in the Explanatory Notes: it was supposedly toughened up following discussion in the Public Bill Committee in the House of Commons. So we have this explanation in front of us and I shall just quote again what the noble Lord, Lord Beith, quoted, which is that

“councillors of a local authority are not a public authority and, therefore, are not prohibited from expressing support for or”—

my emphasis—

“voting in favour of a motion supporting a boycott”.

Can the Minister give us an assurance? If councillors vote for a boycott, which they are entitled to do, according to the Explanatory Notes, and if that boycott motion is passed, enforcement action is taken and ultimately a civil penalty can be levied, is there any prospect whatever of those councillors who voted for the boycott motion being surcharged? Because the prospect of that must clearly be a limitation on their ability to speak.

[Baroness Noakes (Con)]

My Lords, as a Conservative, I believe absolutely in the right to freedom of speech, but I do not think that the limits on freedom of speech in Clause 4 are as great as some noble Lords have tried to make out. I do not think that Article 10 of the European Convention on Human Rights is something that affects the rights of individuals, and Clause 4 is fundamentally aimed at public authorities. I completely understand that there is a very small number of public authorities who can be individuals as well, but, as my noble friend the Minister explained at Second Reading and as the Explanatory Notes make very clear, the prohibition on statements is against public authorities and attaches to individuals only to the extent that they are speaking for the public authority. Even if it applies to the statements made by individuals on behalf of the public authority, the ban applies to the public authority and the enforcement action is taken against the public authority. So individuals are not targeted by Clause 4.

We have to remember that this is not an academic issue. We already know that councils are starting to pass BDS motions and they are against this Bill. We know that the student encampments are including demands or public statements on the conflict in the Middle East and on divestment. They may not get all their demands, but that is certainly where they are pushing towards. Without the Bill, I think we can be fairly sure that BDS activities and statements will continue to increase and that will have an impact on social cohesion, and a particular impact on the Jewish communities that are affected by the sorts of statements that are made.

[Lord Wallace of Saltaire (LD)]

The noble Baroness said that she is afraid that BDS statements will increase. Is she in favour of preventing such statements in unavoidably lively public debate?

[Baroness Noakes (Con)]

Yes, I am against statements being made by public authorities. I am trying to make the distinction at the moment between public authorities and the individuals who are involved in those public authorities, who I think are hardly affected by this, except to the extent that they speak for the public authority. I think there is a case for taking a position against statements by public authorities, because of the impact on social cohesion.

We have to remember that this provision does not come from nowhere: it is rooted in the real, live example of what happened in Leicester Council back in 2014. It passed a BDS motion and then said, “only as far as legal considerations allow”. At that time, that was hugely divisive in the local community. It does cause very real harm and that is why this is so different from the kind of example that the noble Baroness, Lady Chapman, gave at the beginning, about wanting to make a statement about stealing my noble friend’s excellent handbag. This is about social cohesion, at the end of the day; that is why this provision is in here.

[Lord Warner (CB)]

I have listened with interest to the noble Baroness. Can she explain why the rather talented and experienced Constitution Committee took a totally different view from her and was so concerned about Clause 4? Why is she saying that, in effect, it has got this wrong—that it should not be saying that Clause 4 should be removed from the Bill but should welcome it as delivering the requirements of the Bill? I am rather puzzled.

[Baroness Noakes (Con)]

I have never been a member of the Constitution Committee—I am certainly not a current member—so I simply cannot answer that question. I do not know why it has reached the conclusions that it has, but I believe that they are not in accordance with the impact of Clause 4 as drafted.

When dealing with stopping people doing things and making judgments about whether doing so is right, a balance always needs to be struck. In this case, the Government have tilted the scales in favour of social cohesion. People may think that that is the wrong decision and that allowing elected officials to speak on behalf of an authority in the way that they want to is a price worth paying. I believe that, because of the limited nature of Clause 4 as drafted, it strikes the right sort of balance in this case.

We must remember that this Bill does not stop elected officials speaking in their own capacity, nor does it stop bishops doing so—not that that would ever be an easy thing to do. Individuals in public life can have a big impact on social cohesion, but they are not debarred by this Bill from giving their own views on BDS activities, even though they would have such an impact. In that sense, this Bill is a modest change to the status quo on public statements. It is certainly not as far reaching as people have tried to make out. I would like to get a little balance in this debate.

[Lord Hendy (Lab)]

My Lords, the noble Baroness asserted that Clause 4 does not apply to individuals but only to entities. Clause 4 says:

“A person who is subject to section 1 must not publish”,


and so on. In law, a “person” could be a corporation or an individual, but Clause 1 is quite clear in referring to a “decision-maker”, which can clearly be an individual. One can easily visualise a public entity where the decision is made by one person who has had authority delegated to them, a committee or group of people who have the power to make such a decision or the full council, body or whatever it may be. Clearly, Clause 4 is capable of being directed at individuals.

[Baroness Noakes (Con)]

I hear what the noble Lord is saying. Clause 1 affects persons who are decision-makers. Decision-makers are defined in Clause 2, which uses the definition of public authority. As I said earlier, there are a very small number of cases where individuals can be decision-makers. It is not a question of people taking delegated authority to be decision-makers; if I were in a council and delegated to the chief executive, they would not thereby become the decision-maker. The decision-maker remains the public authority under the terms of Clause 2.

[Lord Warner (CB)]

I refer the noble Baroness to Clause 1(7)(b), not just Clause 1(7)(a), which says

“any person seeking to persuade the decision-maker to act in a certain way”.

That sounds to me rather like an individual.

[Baroness Noakes (Con)]

Indeed, but a person who is subject to Clause 1 is a decision-maker. The noble Lord has just referred to the person giving advice or the person seeking to persuade the decision-maker, but that person is not a decision-maker for the purposes of Clause 1, and therefore not for the purposes of Clause 4.

[Lord Warner (CB)]

With all due respect, Clause 4 applies to Clause 1(7)(b), which refers to an individual. We must perhaps ask the Minister to advise us on whether that is true.

[Baroness Noakes (Con)]

We discussed this very point on our first day in Committee, and I think I have stated the correct position on the interpretation of the Bill.

[Baroness Janke (LD)]

My Lords, to answer some of the points made by the noble Baroness, Lady Noakes, the idea that individuals are not targeted is certainly not sufficiently reassuring to make local decision-makers feel protected. Most of what is in the Bill seems to be very much targeted at local authorities and their members.

It is perhaps worth while to point out here, in this unelected Chamber, that councils are directly elected and are accountable to their electorate. They are also obliged to report back to their constituents about such things as decisions that they have made. I was a former leader of a council, and I would have wondered, on seeing this Bill, having been asked why I had made a certain decision, whether replying in a certain way would mean that I was prosecuted, or perhaps that I was not able to reply because I am forbidden to speak about this. There is sufficient lack of clarity in the Bill to make people wonder about that. I do not think that it has been demonstrated otherwise. As the noble Lord, Lord Warner, said, the Constitution Committee sees this as a major threat to free speech. We need some more guidance on this.

I take exception to the idea that, somehow, statements from student encampments are equated with statements issued by locally elected authorities and their officials. They are not the same at all. Local authorities have a constitutional role, and they should be respected as such. The contempt that I have heard from some people in this Committee is unwarranted, given the lack of evidence of councils making such decisions as are prohibited in the Bill.

The idea that prohibiting such statements will have a good effect on social cohesion is much more likely to have the opposite effect. If people are told that they are not allowed to make statements, they are much more likely to try to find other ways of getting their messages across. The idea of oppression leading to better social cohesion seems to me to be a false premise.

I agree with the noble Baroness, Lady Chapman, that there is a complete failure by many of us in this Chamber to explain why Clause 4 is necessary. We have not really heard any good reason, other than the noble Baroness, Lady Noakes, telling us it is for social cohesion.

On the idea that freedom of speech is offended by Clause 4, as the right reverend Prelate said, freedom of speech is a basic right and a cornerstone of democracy. Although we are an unelected House, we fight for democracy—I would hope—and stand by democratic principles, as has the Constitution Committee, as told to us by the noble Lords, Lord Beith and Lord Warner.

The practical issues with the Bill, as to how its provisions are actually enforced, is again something that needs clarity. As the noble Lord, Lord Warner, said at the beginning, we are discovering with the Bill that, the further we go with it, it really lacks clarity. Trying to establish what it is meant to do and how it is meant to do it seems to have defeated us so far.

We need much better clarification about the Human Rights Act. If the Constitution Committee of this House tells us that the Bill contravenes Article 10 of the Human Rights Act, we need to know how it is that Ministers are telling us that it is somehow compliant, as this is clearly not the case.

As the noble Lord, Lord Beith, said, to prevent people talking about issues important enough for them to be calling for a boycott is an outrage. The Explanatory Notes trying to maintain that somehow individual councillors will not be targeted or held responsible is totally inadequate if that is not going to be on the face of the Bill.

The clause deserves to be removed. I very much regret that it disrespects the role and responsibility of directly elected councillors and their officials. It has extreme overreach in trying to gag them and prevent them explaining their decisions, for which they are publicly accountable. I believe that contraventions of the ECHR are matters to be taken very seriously, so I want to hear from the Minister further explanation and further response to the recommendations of the Constitution Committee.