Procurement Bill [HL]

Debate between Baroness Scott of Bybrook and Lord Knight of Weymouth

Committee stage
Wednesday 13th July 2022 Grand Committee

[Baroness Scott of Bybrook (Con)]

As that is a legal question, I shall get a legal answer for the noble Lord, and I will certainly write. I thought I had answered him, but I will make sure that that is clearly written legally.

On the TCA, with respect to Articles 387 and 399 of the EU-UK Trade and Cooperation Agreement, procurement law does not grant rights to workers and, as such, the exclusion grounds are not inconsistent with the UK’s obligations under those articles. The rights protected by these provisions are provided elsewhere in national laws, none of which are affected by the Bill. The exclusion grounds are not intended as a means of enforcing labour rights; rather, exclusion is a mechanism to ensure that contracting authorities do not award contracts to suppliers that pose a risk.

I am confident this will enable contracting authorities effectively to protect the rights of workers delivering public contracts, especially when combined with other changes we are making to strengthen the exclusions regime, such as the inclusion of serious labour misconduct in the absence of a conviction as a discretionary ground for exclusion; requiring assessment of whether the exclusion grounds apply to subsidiaries of the supplier; and extending the current time limit for discretionary exclusion grounds from three years to five years.

Amendments 292 and 297, tabled by the noble Lords, Lord Hendy, Lord Hain, Lord Monks and Lord Woodley, remove the requirement for contracting authorities to consider the risk of the circumstances giving rise to an exclusion ground recurring in applying the exclusions regime. Exclusion is not a punishment for past misconduct; that is for the courts to decide. Exclusion is a risk-based measure and, as such, suppliers should be encouraged to clean up their act and given the right to make the case that they have addressed the risk of the misconduct or other issues occurring again. This might be through better training, stronger compliance controls or dismissing the staff involved in any misconduct. It is for contracting authorities to decide whether the evidence they have seen is sufficient to reassure themselves that the issues in question are unlikely to occur again.

Amendment 519, tabled by the noble Lord, Lord Hendy, proposes to use Clause 104 of the Bill to omit Section 17(5)(a) and (b) from the Local Government Act 1988. It would remove the prohibition on relevant authorities, as detailed in Section 17(5)(a) and (b) of the 1988 Act, to consider in relation to public supply or works contracts the terms and conditions of a contractor’s workers and the employment status of their subcontractors.

The Bill provides for a range of labour violations to be considered as part of the grounds for exclusion, which must be considered for every supplier wishing to participate in each procurement within the scope of the Bill. These matters will be subject to further debate, possibly later today, when the Committee considers the exclusions and debarment regime in the Bill. I am sure my noble friend Lord True will have more to say on that.

The purpose of Clause 104 in the Bill is, first, to ensure that authorities to which Section 17 of the Local Government Act 1988 applies are not prevented by that section from complying with their duties under this Bill; and, secondly, to enable a Minister of the Crown or the Welsh Ministers to make regulations to disapply, when required, a duty under Section 17. The clause ensures that authorities covered by the 1988 Act can take advantage of domestic procurement policies that may be implemented during the life of the Bill.

Clause 104(1), which amends Section 17(11) of the Local Government Act 1988, directly achieves this. However, it amends Section 17 only to the extent necessary to ensure that the relevant authorities are not prevented by virtue of the section from complying with the Bill. It would not be appropriate to use the Bill as a vehicle to make further amendments to the 1988 Act, as proposed by the noble Lord, Lord Hendy.

Amendment 535, tabled by the noble Lords, Lord Knight and Lord Hendy, and the noble Baronesses, Lady Hayman and Lady Bennett, creates the concept of “good work”, relied upon by the other amendments in this group. In the light of my responses on substantive amendments, there is little I can usefully add on this amendment. I therefore respectfully ask that noble Lords do not pursue these amendments.

[Lord Knight of Weymouth (Lab)]

My Lords, I am grateful for the response and to those who took part in this relatively short debate. The arguments were well made, and I think the Minister at the Dispatch Box, the noble Baroness, Lady Scott, agrees with the basic premise. As ever with these things, I was not surprised but disappointed at the response.

My noble friend Lord Hendy made a really good case about the importance of punishing bad labour practice. Recalling P&O Ferries is important; these cases come along and it always ends up feeling like too little too late. This is an opportunity to act more proactively and actually put something into statute.

On the amendments in my name, I was grateful to hear about the UNISON report, as I was not aware of that. I was grateful to hear that the Labour Administration in Wales are getting on with something like this. It is good to hear, as ever, the insights from the noble Lord, Lord Clement-Jones, on AI and algorithmic accountability and regulation. I will need to think about that. I was really pleased to hear the Minister say that she thought more needs to be done on that.

In closing, I offer this up to the Minister: before we come to Report, is it worth having a chat? I listened carefully to what she said about the impact on SMEs from the way we frame some of this. If she is interested in having a meeting to discuss how we can achieve something on the good work agenda in this Bill, probably including David Davis, because I think he is minded to table similar amendments when it goes to the other place, we would be delighted to do that. Perhaps, with the noble Lord, Lord Clement-Jones, tagging along too, we can start to sketch out what we might be able to do on algorithmic regulation in this Bill or in future legislation. On that basis, I withdraw my amendment.