Professional Qualifications Bill [HL]

Lord Alderdice Excerpts

Committee stage
Wednesday 9th June 2021 Lords Chamber

Relevant documents: 2nd and 3rd Reports from the Delegated Powers Committee

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

My Lords, the Hybrid Sitting of the House will now resume. I ask all Members to respect social distancing. I will call Members to speak in the order listed. During the debate on each group, I invite Members, including Members in the Chamber, to email the clerk if they wish to speak after the Minister. I will call Members to speak in order of request. The groupings are binding. A participant who wishes to press an amendment other than the lead amendment in a group to a Division must give notice in debate or by emailing the clerk. Leave should be given to withdraw amendments. In putting the question, I will collect voices in the Chamber only. If a Member taking part remotely wishes their voice to be accounted for if the question is put, they must make this clear when speaking on the group.

Amendment 1

Moved by

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[Lord Fox (LD)]

My Lords, this amendment, I should emphasise to the Minister, is offered very much in the spirit of helpfulness. At Second Reading, the Minister said:

“The Bill will allow action to be taken in the public interest if it is judged that a shortage of professionals has arisen in a profession, but that action in no way restricts regulators’ ability to take decisions about individual applicants; it merely requires them to set up a route through which people can seek entry to a profession.”—[Official Report, 25/5/21; col. 971.]


In other parts of his speech, the Minister reiterated the view that it was not the Government’s intention to interfere with regulators’ roles and responsibilities. Yet he also said:

“I emphasise that we want this new framework for recognition of professional qualifications to complement regulators’ existing practices.”—[Official Report, 25/5/21; col. 909.]


It is because of the need to clarify how the Bill complements the regulators that I am putting forward this amendment with the support of my noble friend Lord Purvis of Tweed.

This Bill is backed up by secondary legislation that we have yet to see and which will define the true nature of this Bill. There are genuine concerns that the Bill creates potential for central government to intervene in a manner that cuts across the Minister’s assurances. This amendment seeks to clarify and delineate the purpose of this Bill. It does no more than the Minister has repeated in meetings and on the Floor of the House.

I make no apology for repeating that the overwhelming proportion of the reach of this Bill is yet to be seen. All we have is the skeleton. We know from the Minister that we should expect a deluge of secondary legislation, and it is in that where we will see reflected the true purpose of the Bill. I would add that, unfortunately, level of scrutiny of such secondary legislation sometimes falls below the level of the scrutiny by your Lordships of primary legislation, which is another danger.

Why should we be suspicious and, indeed, are those suspicions restricted just to these Benches? For the first time, but not the last, I refer your Lordships to the report of the DPRRC, published on 27 May, which addressed this Bill. In that report, the issue is clear. At the outset, the committee categorises Clause 1 as

“a Henry VIII power, as it includes power to amend primary legislation and retained direct principal EU legislation”

and goes on to say:

“The power can be used to make provision about a wide range of matters relating to applications to practise a profession, including ‘detail on the approach to be taken in assessing … qualifications’, requirements for regulators to have regard to guidance when determining applications to practise, the information to be included in such applications, fees to be paid and appeals.”


We have yet to see this potentially very far-reaching legislation. This takes this Bill to a place that is somewhat beyond what the Minister has outlined its role to be. Of course, those Henry VIII powers are qualified, but the scope of those qualifications is broad and will be discussed later.

As well as the mutability of Clause 1, the nature of Clause 3 has confirmed the need for this amendment. I was grateful that the Minister met me and colleagues this week. During that discussion, he confirmed that in relation to the purpose of the Bill, Clause 3 is explicitly needed in order to implement trade agreements where mutual recognition of qualifications is included. In fact, the Minister considers it vital for the Government to use this clause to make sure that the regulatory authorities enact the terms of a future free trade agreement. Of course, it is not needed for that. The Government could bring each trade deal to Parliament for approval, which would be a way of getting primary approval of such clauses within a free trade agreement. In that case, Clause 3 would not be required, and we can have that debate later. This is all about the creeping remit of the Bill, which is why I refer to it in this amendment.

The amendment clearly upholds the aim of giving all regulators the powers to regulate international professionals. Importantly, it also underpins the independence of the regulators—independence that the Minister so obviously treasures, but which this Bill, as drafted, so obviously threatens. In the Minister’s own words at Second Reading,

“the regulators are the experts in their respective fields and they ensure that high professional standards are maintained. Regulators must continue to have the ability to act in the public interest, including in the best interests of their professions and the consumers of professional services.”—[Official Report, 25/5/21; col. 971.]

We say prove that by accepting Amendment 1 and putting it in the Bill. I expect the Minister to say that he agrees with the text, but disagrees with putting it in the Bill. If indeed that is the Minister’s response, I would appreciate him explaining why he disagrees with putting it in the Bill. What is wrong with putting it in if that is the purpose of this Bill?

This is a skeleton Bill—another skeleton Bill—and this amendment tries to make clearer what this Bill is for, explicitly guiding what the Bill will do when the body of secondary legislation is added. I beg to move.

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

I call the noble Baroness, Lady Noakes.

[Baroness Noakes (Con)]

My Lords, the noble Lord is looking at an out-of-date list of speakers.

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

I call the noble Lord, Lord Palmer of Childs Hill.

[Lord Palmer of Childs Hill (LD)]

My Lords, I am rising rather surprised. We have heard my noble friend Lord Fox elegantly put the reasons why the Bill needs to be slightly tidied up, if nothing else. The amendments in this group do all they can to allow overseas qualifications to be treated as acceptable in the UK. The amendment in my name seeks to deal with a situation where the qualifications and experience are held to fall short; the Bill does not talk about what happens then. In many spheres, what happens is that there is some bridging measure to bring the applicant up to the required standard.

Amendment 12 in my name seeks to give the regulator relief from bringing the applicant up to the required standard if this would involve unreasonable cost, time and be a resource burden on the regulator. My noble friend Lord Fox said that the regulator will be independent. We must not add the cost of providing bridging training if people do not come up to standard.

As has been said, this is a skeleton Bill. We need to make it clear on whom the duty falls to provide the additional training or experience to bring it up to standard. The Bill does not say, but it must not be down to the independent regulator.

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

I now invite the noble Baroness, Lady Noakes, to make her intervention.

[Baroness Noakes (Con)]

My Lords, I asked the Government Whips’ Office to order the speakers as is normal in the Chamber when we do not have lists—that is to say, those who have tabled amendments are allowed to speak before those who simply wish to comment on them. I was advised that the list was issued late this morning.

The noble Lord, Lord Fox, may recall that I do not like purpose clauses. I believe that a Bill should be written in clear language and that its scope and impact should be readily understandable on its own terms. This Bill fails to meet that test, but I do not think that a purpose clause is the answer. Instead, we should focus on making sure that the Bill itself is fit for purpose. We have tabled a number of amendments aimed at doing this.

I also have a minor quibble with the drafting of Amendment 1. Subsection (2) refers to

“the independent process of defining the accreditation processes of the regulators.”

I believe that the independent processes which this Bill should protect go beyond mere definition of accreditation processes. We do not want any form of interference in the independent processes of regulators. This should be an enabling Bill which should unblock legal impediments to the recognition of overseas qualifications. It must steer clear of all the processes operated by regulators, not just of those defining accreditation.

I put my name down to speak because I recognised the Institute of Chartered Accountants’ provenance of Amendment 12 in the name of the noble Lord, Lord Palmer of Childs Hill. That is why I was keen for him to speak first. Amendment 9 in my name, in a later group, is slightly simpler, but on the same basic point. I realised a little too late that perhaps I should have asked to add my amendment to this group. The essence of Amendment 12 is to ensure that inappropriate burdens are not placed on regulators, as the noble Lord, Lord Palmer, has explained. I will not repeat those arguments. I will explain my own amendment when we reach it later.

This is a very real issue. The Government need to look at it again to ensure that their approach is reasonable in the context of what regulators could be compelled to do by the provisions of this Bill. As far as we can, we should seek to avoid any possibility that they could be compelled to do anything unreasonable, burdensome or otherwise inappropriate to their profession.

Post Office Court of Appeal Judgment

Lord Alderdice Excerpts

Wednesday 28th April 2021 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)]

I thank the noble Baroness, Lady Hayter, and the noble Lord, Lord Fox, for their comments. I completely share many of their sentiments of shock and outrage. The tragic failings of the Post Office have occurred over many years, over many different Governments. On behalf of the current Government I can only say that we are truly sorry.

We welcome the decision of the Court of Appeal on 23 April to quash the 39 convictions. This is in addition to the six convictions that were quashed in the Crown Court in December. The impact that this ordeal has had on affected postmasters, their lives and livelihoods cannot be overstated. Nobody who saw the television coverage and the news reports the other day can fail to have been affected by the individuals featured. We certainly hope that, with this decision, these postmasters can at least start the process of moving forward to a new chapter in their lives.

I move on to the specific issues raised by the noble Lords. On compensation, the Government hope that the court’s decision is another important step towards bringing resolution to these postmasters. The Court of Appeal’s judgment will require careful consideration by all involved, and the Post Office itself will need to consider the next steps and the best process for fairly compensating these postmasters. We are keen to see that all those whose convictions are overturned are fairly compensated as quickly as possible and we will certainly work with the Post Office towards this goal. I understand the strength of feeling felt by those postmasters in the GLO who I understand only received a portion of the original £57.75 million settlement by the Post Office. However, that was a full and final settlement reached between the claimants in the GLO and the Post Office.

Both noble Lords mentioned the inquiry. Many postmasters and their families have suffered issues and distress since the faults in the Horizon system. We all agree on that. Some had their livelihoods and businesses taken away and were convicted of crimes that we now know they did not commit. Anybody can only imagine the distress that that must have caused to loyal, upstanding and honest members of the community. We are clear that a situation such as this must never, ever be allowed to happen again.

To ensure that the right lessons are learned, and to establish what must change, we launched an independent inquiry, led by Sir Wyn Williams, in September last year. He is a retired High Court judge with a wealth of experience and is fully independent of both the Government and the Post Office. I can tell the noble Lord, Lord Fox, that the inquiry has made swift progress. It has already heard from a wide group of affected postmasters. The call for evidence has recently closed and I understand that Sir Wyn is planning to have some public hearings on these matters in June. I can confirm that we expect to get his report by the end of the summer.

Given that all parties so far are committed to co-operating, we remain of the view that a non-statutory inquiry is the right approach. However, if Sir Wyn does not get the co-operation he requires, then all options are on the table and we will not hesitate to act. We do expect his report in the summer.

On who is to blame, decisions regarding the litigation strategy at the time were taken by the Post Office based on the legal advice that it had received. The Government at the time relied on the Post Office’s management to investigate issues with the Horizon system. As we have seen from both Mr Justice Fraser’s judgment and now the Court of Appeal judgment, the Post Office consistently maintained that the Horizon system was robust. That obviously turned out to be incorrect. What is also clear, from the Court of Appeal judgment last week and the judgments in the 2019 group litigation, is just how misguided the Post Office was in its approach to the management of issues arising from the operation of the IT system. All of these matters will be investigated in the inquiry, so that we can ensure this never happens again. I commit to keeping the House fully informed.

The noble Lord, Lord Fox, raised the issue of private prosecutions. The Post Office no longer undertakes any private prosecutions, and I have been personally assured by the new chief executive that it has no plans to undertake any further prosecutions in these matters. However, the Government understand the wider challenge that the Post Office case poses regarding the responsibilities that companies have in undertaking private prosecutions. The Justice Select Committee considered this last year and concluded that prosecutions brought by victims of crime themselves, whether corporate or individual, still have a valuable part to play. The Select Committee concluded that existing safeguards in place to regulate private prosecutions are effective at filtering out weak claims. As the noble Lord, Lord Fox, himself acknowledged, the Post Office’s powers to bring private prosecution fall under Section 6(1) of the Prosecution of Offences Act 1985, and they are not specific to that company. It has the same right as any other, whether an individual or a company, to bring a private prosecution but, as I said, I have been assured that it has no plans to bring any further prosecutions.

The noble Lord, Lord Fox, was kind enough earlier today to mention the issue of the Post Office and its investigatory powers. Since he did, I have asked my officials to investigate this matter. There are, apparently, over 600 public authorities that can use investigatory powers, and these are overseen by the Investigatory Powers Commissioner’s Office. There have been no changes to the authorities that the IPCO oversees since the introduction of the Investigatory Powers Act. According to the IPCO 2019 annual report, Post Office Ltd is not on that list.

[The Deputy Speaker (Lord Alderdice) (LD)]

We now come to the 20 minutes allocated for Back-Bench questions. I ask that questions and answers be brief so that I can call the maximum number of speakers.

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[Lord Callanan (Con)]

I will certainly pass on the noble Baroness’s comments on the speed of the justice system to the Ministry of Justice. I am sure there are many other areas where we would all like to see speedier justice.

[The Deputy Speaker (Lord Alderdice) (LD)]

The noble and right reverend Lord, Lord Harries of Pentregarth, has withdrawn, so I call the noble Lord, Lord Stevenson of Balmacara.

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords, the Minister has confirmed that the inquiry—although, technically, I think it was originally called a review—is looking at corporate governance issues, and that is welcome. Could he answer two specific questions? Have the Government submitted any evidence already in the response to the call for evidence? If not, why not? Secondly, does Sir Wyn have the powers to subpoena information from the Government if it turns out that he requires that?

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[Lord Callanan (Con)]

The noble Lord will notice that I have avoided commenting on any potential police investigation, for very good reasons that he will understand. However, I hope the investigation will reach speedy conclusions and the police will take the appropriate action.

[The Deputy Speaker (Lord Alderdice) (LD)]

We have come to the end of the 20 minutes and I regret that two noble Lords who were actually in the Chamber were unable to ask their questions.

Trade Bill

Lord Alderdice Excerpts

Consideration of Commons amendments & Lords Hansard
Tuesday 23rd March 2021 Lords Chamber

[Baroness McIntosh of Pickering (Con)]

I am delighted to follow my noble friend and I hope he is completely injury-free and that his chariot will be repaired at the earliest opportunity so that he maintains his mobility. I am full of awe and praise for the noble Lord, Lord Alton. I watched him with great admiration in the other place and I think that, if anything, he has come into his own in this place, so I pay huge tribute to him and those who have supported him in this. I also pay tribute to the Minister. I know there will be some disappointment on a particular aspect, but the Bill will definitely leave this place better than it was before.

I have a specific question about the sequencing of the reports that we are now going to have as trade agreements are being negotiated. We know that the Secretary of State is going to do a report, taking into account the report from the Trade and Agriculture Commission, which I am delighted now has a statutory basis and is on a more permanent footing. That report will come and the Government will presumably find time for it to be debated. I would like to understand better the sequencing of that report with the report that we have agreed today will also come forward if the responsible committee in the House of Commons publishes a draft report and is not satisfied with the Secretary of State’s response. Will the sequencing permit both reports to have been prepared and debated in Parliament before, as my noble friend Lord Lansley said, the free trade agreement is signed by the Government and ratified by Parliament?

[The Deputy Speaker (Lord Alderdice) (LD)]

The noble Lord, Lord Balfe, has withdrawn, so I call the noble Lord, Lord Polak.

[Lord Polak (Con)]

My Lords, I am pleased that this Bill will become law, because it is important for the welfare and prosperity of this country. I pay tribute to my noble friend Lord Grimstone, the Minister, because he has listened and understood. I am grateful, too, to the Foreign Secretary for the limited sanctions announcement yesterday. It is progress. I also agree with a number of noble Lords that the ad hoc committee comprised of former senior judges in your Lordships’ House is an excellent idea; I look forward to seeing it become a reality. As I said earlier, I pay tribute to the 29 so-called rebels in the other place; 29 Members who have shown their humanity and voted in support of the genocide amendments. It is also clear to me that many other honourable Members of my party would have voted the right way had whipping pressure not been exerted.

On 23 February, I referred to the festival of Purim and the role that Queen Esther played in saving the Jewish people from genocide. Fortunately, there are many festivals in the Jewish calendar: this weekend, we celebrate the festival of Passover and we recall that Moses, on behalf of God, appealed to Pharaoh to “let my people go”. My appeal is that the Uighur Muslims are free to go, and free to live their lives in peace and prosperity. That will clearly come about only if we continue to apply pressure, and I will continue to follow the lead of my friend, the noble Lord, Lord Alton, who has just celebrated his seventieth birthday. I wish him a happy birthday. It is a Jewish tradition to wish a person “many more years, up to 120”, which gives him another 50 years of great humanitarian leadership.

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So I say to the House that I am glad that we are making a bit of progress, but it is not enough. This will come back, and I hope that the Foreign Office, our Foreign Secretary and his Ministers will find good ways of making our standards real.

[The Deputy Speaker (Lord Alderdice) (LD)]

Before I call the winding-up speakers, does anyone else in the Chamber wish to speak? No? Then I call the noble Lord, Lord Purvis of Tweed.

[Lord Purvis of Tweed (LD)]

My Lords, it is a pleasure to follow the noble Baroness and endorse the points that she made. This may be the final debate on this issue for the moment, but it has nevertheless been a strong one.

In my mind, the noble Lords, Lord Lansley and Lord Adonis, got to the nub of the issue: the dilemma that we face when we seek to trade with countries that move away from the human rights standards that we seek. However, that dilemma is not new; what is perhaps new is the scale of it over the past few years. I remember clearly when, as a Member of the Scottish Parliament, I and a number of committee members shook hands with the Dalai Lama on a visit to Edinburgh. An official Government of China communiqué said that the economy of Scotland would be harmed as a result of this handshake. This was 15 years ago, so there is no new element of the line—as the noble Lord, Lord Adonis, put it—that the Foreign Office has trodden for a great number of years, in raising human rights aspects but also seeking to increase trade with the largest trading country in future.

The noble Lord, Lord Lansley, indicated that it is not just FTAs that cover this gamut. I am interested to know whether the Minister at the Dispatch Box can confirm that the Office for Investment, set up and chaired by the Prime Minister, is not proactively seeking investment agreements with China at the moment. If the Minister can confirm that, that would be reassuring, because it would be a live-time example of whether or not a government office chaired by a trade Minister is seeking new financial trading relationships on a preferential basis with China. If the Minister could confirm that in his winding-up speech, I would be grateful.

Perhaps it is different now because the tightrope—as the noble Lord, Lord Adonis, called it—is impossible to straddle because of, as the Foreign Secretary said, the

“industrial-scale human rights abuses.”—[Official Report, Commons, 22/3/21; col. 622.]

The question is what consequences there are in our trading relationships with preferential trade. Sir Geoffrey Nice, who is held in very high regard in this area, communicated with me and my noble friend Lady Northover today. He said something in his email which I asked his permission to quote as it really struck me. He reflected on the fact that, in my opinion, somewhere in the last two generations we have lost something. He said that we should understand and recognise that human rights exist for and should be honoured by

“every citizen of the world for every other citizen of the world, not just sometimes by some governments when it suits them.”

Some people argue that trading relationships are between businesses and people and treaty-making and diplomacy are Government-to-Government, but now, in this very interconnected and complex trading world in which we live, with comprehensive trading agreements, investment partnerships and strategic alliances, there is a wide gamut of preferential terms of access to the UK financial sector, the UK market or areas where we have sought the competitive advantage of China’s massive industrial and commercial manufacturing base.

It is the moral ambiguity that my noble friend Lord Fox and others have indicated at the heart of this Government’s policy that we have been highlighting. I would go further and say that there is a degree of intransigence and contradiction at the centre of the Government’s policy in this area. One contradiction is that the very approach outlined by the Minister today at the Dispatch Box and in his letter this afternoon, in which he describes the process now going forward, is against the mechanism that he and the Government have indicated for other trading agreements, and parliamentary approval is against UK constitutional approaches with regard to scrutiny. We cannot have both, so I hope that the Government will see that opening up scrutiny and allowing greater parliamentary say, as the noble Lord, Lord Lansley, indicated, is of benefit, not against UK constitutional approaches. In my view it should be one of the core elements of the UK constitutional approach that Parliament has a key role in these areas.

I share, as have others, my noble friend’s perseverance on this issue and that of those on the Government Benches in the Commons who have consistently told the Government to think again. On our Benches, Alistair Carmichael and Layla Moran were part of a wide coalition that will not now go away. The debate that has been started—the persistence and the perseverance —indicates that there will need to be much greater comprehensive elements in the Government’s approach to trade and human rights. We have said repeatedly that there should be a trade and human rights policy that outlines the Government’s policy, with triggering mechanisms that will suspend bilateral agreements, not just FTAs, when there are significant human rights concerns.

There needs to be a triggering mechanism, because we know that the nuclear option of cancelling all trade with a country should be reserved for the most grotesque situations, as we have been debating. However, there are other situations where we wish to use UK preferential market access as a lever around the world. It is a contradiction because we have moved away from an approach, which we were party to in recent years as part of the EU, of having triggering mechanisms to suspend bilateral agreements when countries are in breach because of significant human rights concerns. Indeed, there is a contradiction at the heart of what the Government are currently doing by reinstating preferential terms for Cambodia while the EU had withdrawn them because of human rights concerns. This Government have reinstated them without any indication of why.

When it comes to wider aspects of the partnership agreements, strategic alliances and other preferential areas, as mentioned by the noble Lord, Lord Lansley, in response to the Statement earlier today, I asked the noble Lord, Lord Ahmad, whether any of our current preferential trading agreements with China have been suspended as a result of the alleged genocide against the Uighur community in China. It is quite clear that the noble Lord, Lord Ahmad, did not have an answer in his briefing pack—if he had, he would have said so—so I hope that the Minister for Trade will give an indication of whether we have indicated that any preferential trade agreements with China are now open for suspension.

As the noble Baroness, Lady Kennedy of The Shaws, indicated, it is now time to open the debate about moving some of these decisions away from Governments. If this Government are refusing to, or perhaps any Government cannot, tread the line the noble Lord, Lord Adonis, indicated, of making decisions about suspending trading relations or preferential trading relations when there are gross human rights abuses, now is the time to start debating whether the UK should have an independent trade and human rights commission, not only for the sanctions regime but for other areas of new trading relationships.

When the noble Lord, Lord Alton, was a very young MP for Liverpool—I hope he will not mind me saying so since it was his birthday recently—he was a street campaigner and coined one of things that every Liberal campaigner, including me, has copied since, which was a slogan on the focus leaflets: “A record of action, a promise of more”. We have seen his record on this issue. I know there is a promise of more. As a veteran of three trade Bills in three years, I will not say goodbye to this issue but “Au revoir” until the next one. Inevitably there will be one. These issues—the contradictions at play and the moral ambiguities—need to be ironed out. This House and many others will do our best to do so.

Trade Bill

Lord Alderdice Excerpts

Consideration of Commons amendments
Tuesday 23rd February 2021 Lords Chamber

[The Deputy Speaker (Lord Alderdice) (LD)]

My Lords, the Hybrid Sitting of the House will now resume. I ask Members to respect social distancing. I will call Members to speak in the order listed. As there are counterpropositions to each of today’s Motions, any Member in the Chamber may speak on each group, subject to the usual seating arrangements and the capacity of the Chamber. Any Member intending to do so should email the clerk or indicate when asked. Those Members not intending to speak on a group should make room for those who do. All speakers will be called by the Chair.

Short questions of elucidation after the Minister’s response are discouraged. A Member wishing to ask such a question must email the clerk. The groupings are binding. A participant who might wish to press an amendment other than the lead amendment to a Division must give notice in the debate or by emailing the clerk. Leave should be given to withdraw Motions. When putting the Question, I will collect voices in the Chamber only. If a Member taking part remotely wishes their voice to be accounted for if the Question is put, they must make this clear when speaking on the group. Those noble Lords who are following the proceedings but not speaking may submit their voice, as Content or Not-Content, to the collection of their voices by emailing the clerk during the debate. Members cannot vote by email; the vote will be taken by the remote voting system.

Motion A

Moved by

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[Lord Lansley (Con)]

My Motion A1 would insert Amendment 1D in lieu—it is on page 4 of the Marshalled List—which would do two things. It would require a debate on draft negotiating objectives in relation to future international trade negotiations where such a debate has been requested, and that Ministers would not be able to proceed with negotiations until such a debate had taken place. It would also require that where a relevant committee of either House seeks a debate under CRaG within the 21-day period, that period should be extended until the debate has taken place.

Noble Lords will recall that on two previous occasions this House sent amendments requiring additional parliamentary scrutiny to the other place. On each occasion, they were supported on a cross-party basis. I am very grateful for the support that I have received from all sides of this House for this purpose. In the other place, 11 Conservatives supported the amendment on the first occasion, while 13 supported it on the second occasion, and although they did not vote for it, both Liam Fox, the former Secretary of State for International Trade, and Jeremy Wright, the former Attorney-General, expressed support in particular for the proposition that there should be a debate on the negotiating objectives at the commencement of plans for an international trade agreement.

In preparing the amendment in lieu, we intended to narrow down simply to those two points, leaving out—not because they are not important but because we believe that the Government have already given assurances on this—first, that the Government would publish in their Explanatory Memoranda under CRaG details of the legislative implementation of any agreement and, secondly, that in the negotiating objectives they would consult with the devolved Administrations. Given those two issues, let me say how much I appreciate the support that I have received in this House and the constructive and helpful conversations that I have had with the Minister and the Bill team. I appreciate the positive way in which they responded.

Noble Lords will have heard the Minister say two things that are, from my point of view, of great importance: first, that where the International Agreements Committee, of which I have the privilege to be a member, makes a report on the Government’s draft negotiating objective for an agreement, the Government will facilitate such a debate; and secondly, that where a debate has been requested under CRaG within the 21-day period, Ministers will not ratify such an agreement until such time as the debate has taken place. In both respects—speaking as a former leader of the House of Commons, I should say that the Minister has, quite properly, reserved the position of the business managers—these things would happen only when parliamentary time allowed.

These assurances go a long way to meeting what we have been asking for. They are not technically everything that we are asking for. There remains a significant loop- hole: if a debate under CRaG takes place after the 21-day period has expired and Ministers have not sought an extension to that period, which they can do, then, strictly speaking, even if the other place passed a Motion that ratification should be delayed, there would be nothing legally to stop Ministers proceeding to ratification or, indeed, ratifying it before the debate took place.

Given what the Minister has said, I think we have moved to a happy position where, if I can put it in the context of this House, we have moved from what has been up to now, particularly where CRaG is concerned, conventional—that is that Ministers should not ratify until a debate has taken place and should legislate for implementation before ratification—to what I might think of as a rule. It is not in statute but, in the same way that the Ponsonby rule existed for quite a long time before the CRaG legislation was passed, we have now acquired—if he will forgive me—the Grimstone rule for debate on negotiating objectives and for ratification not to take place before a debate has taken place under CRaG where requested. So I am most grateful to my noble friend. I am especially grateful to the noble Lord, Lord Stevenson of Balmacara, and to the noble Lord, Lord Purvis of Tweed, particularly because a debate on the negotiating objectives was in his original Amendment 1, which was sent to the other place with the Bill when it left this House in the first place. I hope that he and other noble Lords will join me in expressing satisfaction at the outcome that has been achieved.

[The Deputy Speaker (Lord Alderdice) (LD)]

The noble Baroness, Lady Jones of Moulsecoomb, has indicated that she wishes to speak in the gap prior to the rest of the listed speakers.

[Baroness Jones of Moulsecoomb (GP)]

I had not realised that there would be so few speakers in this debate; I would have written a much longer speech.

I try not to be rude when I speak in your Lordships’ House but sometimes it is incredibly difficult. I find it incredibly difficult to understand how the Minister kept a straight face while reading out those first couple of paragraphs about how the other place has rejected all our amendments and so on. It has not. The Government have let power go to their head. They have an 80-plus majority and think that they can just boot out everything that they do not like. I am afraid that that is just not true. We have spent four years working on this Trade Bill. For four years, we have been negotiating with Ministers and trying to make the Bill better, and it has been scrapped each time. Now it has come back and I am afraid that we are digging in our little pink trotters on some aspects. Telling us that it has been rejected endlessly by the other place does not wash.

I will go back to my speech now. Quite honestly, it is our responsibility to reject legislation that is inadequate or unlawful. That is our job. The Government expect us just to back down all the time because of the electoral majority but that will not happen. To think that you can bring a Trade Bill here with a sort of take-it-or-leave-it deal is neither believable nor credible. We should pass this amendment. I congratulate the noble Lord, Lord Lansley, on moving it and believe that the Government should not oppose it in the Commons.

[The Deputy Speaker (Lord Alderdice) (LD)]

Does anyone else in the Chamber wish to speak? No? We will move on to the listed speakers. I call the noble Lord, Lord Purvis of Tweed.

[Lord Purvis of Tweed (LD)]

My Lords, I, too, thank the noble Lord, Lord Lansley, for moving this amendment and allowing us to debate this issue. I will turn to that in a moment.

When the noble Baroness was speaking, I reflected on the constitution arrangements that we have. I think that she and I both favour change in our constitution to change the mechanism of appointment to this place and make it a fully democratic House. Nevertheless, in his remarks the Minister referred to having trade scrutiny and decision-making that is appropriate to our constitutional arrangements. Our constitutional arrangements say that this is a revising Chamber, and we are doing our duty in asking the Government to think again. When the House has voted by large majorities on every occasion that it has debated scrutiny amendments in either my name or that of the noble Lord, Lord Lansley, it has made its view plain. It is therefore incumbent on the Government to reflect on that, not simply to exercise the Whip.

One of the votes that the Minister referred to tested this point slightly. Last time round, the other place was not asked to have a separate vote on these amendments because, in the way that they scheduled all this, the Government bundled them all into one. Members of the Commons with a particular view on scrutiny, human rights, genocide or anything else were asked to support or oppose the Whip in one particular vote. I do not think that that reflects very well on the way in which the Government have approached the Trade Bill and these stages.

However, as people more famous than me have said, we are where we are. I thank the noble Lord, Lord Lansley, for his work on getting us to this position. I have enjoyed working with him, the noble Lord, Lord Stevenson, and others. It has genuinely been cross-party work. I also share the thanks expressed by the noble Lord, Lord Lansley, to Jonathan Djanogly and others in the House of Commons for their work. In many respects, they have been courageous. Consistently voting or making a case against one’s own Government is a courageous thing in politics, but they are doing it out of a great sense of sincerity that going forward trade agreements for the UK are now deep and comprehensive by definition and touch on very wide aspects across public policy and regulation and therefore for parliamentary scrutiny to be effective, it should inform debate, and if accountability is to be operable, that debate should lead to votes. Ultimately, that is the approach about which we have sought to persuade the Government.

There have been indications of the Government being more flexible in certain areas. This is an interesting Bill which, as the noble Baroness said, has taken so long. A White Paper about trade policy appeared and disappeared mid-Bill; there has been no successor to it. The words of the Minister today are helpful and we now have the Grimstone rule, which is that ratification of a new trade agreement will not take place without a debate. That is important. It is not as much as I wanted or as much as the Government were going to give us at the start of this process, many years ago, but this is the third Minister who has handled this Bill and it is third time lucky, as far as the commitment that we will at least be able to vote on the agreements coming up.

There had been a rule for treaty ratification called the Ponsonby rule. It was replaced by statutory provision, because we were not satisfied that simply a ministerial rule, commitment or convention would be appropriate. While we may be putting this issue to bed in this Bill, at this moment, the issue has not been put to bed. Other Bills in the future will do as we did with the Ponsonby rule, which was to put it on a statutory footing. We will have to live with the Grimstone rule for the moment. It is perhaps, shall we say, a tweaking of the Government’s position. Nevertheless we accept it for the moment, as the House was clear, in all its votes, that more scrutiny, accountability and debating are required. I assure the Minister that we will come back to this at other times.

National Security and Investment Bill

Lord Alderdice Excerpts

2nd reading & 2nd reading (Hansard) & 2nd reading (Hansard): House of Lords
Thursday 4th February 2021 Lords Chamber

[Baroness Bennett of Manor Castle (GP) [V]]

My Lords, I join other noble Lords in congratulating the noble Lord, Lord Woodley, on his arrival in the House. He commented powerfully on the failure of privatisation. They are remarks I welcome and to which I will circle back.

Two Greens are speaking in this Second Reading. My noble friend Lady Jones of Moulsecoomb will talk about the national security aspect of the Bill and I will speak on the investment part. My noble friend will focus on the major, long-identified threats of the climate emergency and the nature crisis, with its many linked dangers, including that of pandemics. On those and other issues, as the noble Baroness, Lady Northover, noted, it is nonsensical that we are debating this Bill while still awaiting the integrated review. I want to focus mainly on the investment part of the title and on another element of national security—poverty, inequality and how the finance curse contributes to them.

There is increasing academic focus on the importance of giving macroprudential regimes a sense of social purpose, including in respect of national security. Excellent work is being conducted at the University of Sheffield, particularly by its Sheffield Political Economy Research Institute, known as SPERI. We have an oversized, overactive, extractive financial sector. A SPERI report conservatively put the cost of the finance curse between 1995 and 2015 at £4,500 billion. That has to be seen as a threat to our national security. Money that could be strengthening our society is lost, as is control over a commodity as essential to a modern society as water or air. The finance curse is built on a sector that, as we learned in 2008, is as fragile and dangerous as an oversized dictator’s statue teetering on an inadequate, narrow pillar.

The other security threat lies in the extractive processes. There are huge and widely acknowledged issues of corporate culture and priorities, as well as regulatory loopholes and blind spots which allow financial funds and senior corporate management to loot companies and hollow out balance sheets. As a society and as a Parliament, we have lost control.

This issue arises particularly in the context of this Bill, where we are talking about investment by foreign companies in foreign states. We might hope that some pressure could be put on domestic companies to act in socially responsible ways by directing at least some of their funds to things we need to keep society running. They have, after all, to exist in this country, even if they seldom keep their profits here. The same constraints do not apply to foreign investors. While we know that a huge percentage of profits from even UK investment ends up in offshore tax havens, we can be sure that those profits will not help us where there are foreign owners.

I want to focus briefly on the nature of a curse—be it finance or resource. We look around the world at nations often identified as suffering from resource curse, such as the Democratic Republic of the Congo, Venezuela, Iraq and South Sudan. They have huge problems of national—and internal—security. Oil is sucked out of their rocks. Our society is milked for cash. Meta-analyses of the resource curse show there is nothing inevitable about this. The quality of governance, the rule of law and the functioning of democracy are crucial to prevent it. Which is where we come back to this law—and the comments of the noble Lord, Lord Woodley.

In the UK, through continuing decades of privatisation, we have sold off the family silver. We are now down to the rather small teaspoons. When, in 2016, the people showed that they wanted to “take back control”, that reality was hidden, but the Government no longer have flamboyantly presented fictions about Brussels to hide behind. When they champion “Singapore-upon-Thames”, they will be held responsible for the consequences. Noble Lords working on this Bill, but particularly the Government, might want to focus on that.

[The Deputy Speaker (Lord Alderdice) (LD)]

The noble Lord, Lord Clark of Windermere, has withdrawn, so I call the noble Baroness, Lady Ritchie of Downpatrick.

Trade Bill

Lord Alderdice 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 Grimstone of Boscobel (Con)]

My Lords, this group consists of government amendments, together with amendments from my noble friend Lady McIntosh of Pickering and the noble Lords, Lord Stevenson of Balmacara and Lord Purvis of Tweed. I will try to set a good example by keeping my comments tight and to the point, and I will of course write to noble Lords whose comments I do not do justice to in my response. I am convinced that one thing I have learned in taking this Bill through your Lordships’ House is that it is not possible to please all the people all the time in relation to the contents of the Bill.

I turn, first, to the amendments in the name of my noble friend Lady McIntosh. Although their purpose and intent are similar to those underpinning the government amendments before your Lordships—to ensure that high standards of imports into the UK are maintained—my noble friend’s amendments go further. They would create a body responsible for setting criteria for assessing whether provisions in trade agreements on UK imports meet or exceed domestic standards on a very wide range of issues. This would, as a result, set restrictions on what goods could be imported under trade agreements.

It is not appropriate for the UK to impose our standards on other countries and prohibit imports of goods that do not meet our standards where there is no basis to do so. Not only could doing so put us in breach of our WTO obligations but, as we spoke about in Committee on a similar amendment, such action has the potential to harm the economies of developing countries and some of the poorest people in society, and to increase protectionism.

The amendment is unnecessary as the standards that it seeks to protect are already enshrined in domestic statute and the Government will uphold them. Any changes to existing standards would, of course, require new legislation to be scrutinised by Parliament. I believe that the Government have taken decisive action to uphold our commitments to high standards. Extending the remit of the TAC to areas such as human rights would run the risk of duplicating the functions of trusted bodies such as the Equality and Human Rights Commission. I am sure that that is not something my noble friend would wish.

Similarly, my noble friend’s amendments apply to all trade agreements, including continuity agreements. Instead, the TAC should focus on only new free trade agreements and agreements signed with continuity partners from 2023 onwards. The UK’s continuity FTAs, as I have said previously, roll over existing EU arrangements that we now wish to hold on a bilateral basis. Those agreements were scrutinised under EU scrutiny procedures and simply replicate existing EU trade agreements, with necessary adjustments to reflect the UK context.

The Government have listened carefully to the concerns of the House with regard to independent scrutiny of FTAs. I am very pleased to bring forward Amendments 31, 34, 35, 36, 49 and 50, which will put the Trade and Agriculture Commission on a statutory footing. This step is integral to boost scrutiny of our new free trade agreements as we move on from continuity.

The current TAC had a different function. It was established as an independent advisory board in July 2020 to advise and inform the Government on their future trade policy. It aims to ensure that animal welfare and environmental standards in food production are not undermined, that consumer and developing country interests are represented and that new export opportunities are secured for producers in all parts of the UK. The amendments today will not impact the role of the current TAC, which will still produce a report by February 2021. I put on record that the Government are thankful for the commitment, time, investment and hard work that current TAC members and representatives of its working groups have put in, and we commend the success it has had to date. We believe that the action we are now taking to put the TAC on to a statutory footing will be an important development in boosting the scrutiny of the Government’s trade policy.

Amendment 34 places the Secretary of State under a duty to seek advice from the TAC on matters set out in Section 42 of the Agriculture Act 2020, excluding human life and health—I know that this point is of concern to a number of noble Lords; I will come back to it in a moment—in preparing a report to Parliament to accompany relevant free trade agreements laid under the Constitutional Reform and Governance Act procedures. I particularly reassure the noble Lord, Lord Grantchester, that the omission of human health from the remit of the TAC does not in any way diminish the importance that we will attach to it. It is just that, when we looked at the composition of the TAC and its range of duties, it seemed that expert advice relevant to human life and health would best be sourced separately from other, more expert bodies in that field. The report under the Agriculture Act will include both advice that comes from the TAC and advice that comes from other relevant bodies in relation to human life and health. The duty will be exercised, but not through the TAC.

Section 42 of the Agriculture Act places a duty on the Secretary of State to report on whether the measures in certain future FTAs applicable to trade in agricultural products are consistent with maintaining UK domestic statutory protections for human, animal or plant life or health, animal welfare and the environment. The TAC advice will inform that report. It will be laid separately before Parliament as an independent report, but it will not be the totality of the report under the Act.

The role of the statutory TAC will therefore represent an evolution of the current TAC. The statutory TAC’s purpose—to provide advice under Section 42 of the Agriculture Act—is set out in Amendment 31, and the TAC advice will ensure independent expert scrutiny of new free trade agreements. The request for advice by the Secretary of State and any guidelines will be published, and advice supplied by the TAC will be laid before Parliament. That is the role of the TAC. It is not a standing body producing advisory reports, as one might have deduced from the existing TAC; it is an independent expert body scrutinising new free trade agreements as and when they come along.

Amendment 31 creates a power for the Secretary of State to appoint members and, of course, a duty to have regard to the desirability of appointing members with expertise specific to the role of the TAC. The Government will work to ascertain the range of skills and knowledge required for the commission, noting that additional skills and expertise might be required and that the list in the amendment is not, of course, exclusive. The TAC must have those skills but the Secretary of State is free to decide that it might need additional skills other than those on the list.

I can absolutely affirm to your Lordships that the Secretary of State will make appointments in line with all the usual public law principles applicable to all ministerial decision-making and within the confines of the new statutory provisions. These will be direct appointments and will follow established protocols, demonstrating the department’s commitment to a robust process and eliminating any conflicts of interest. The steps required as part of this process will be reflected in the TAC’s terms of reference.

As a non-incorporated expert committee—I might just dwell on those words for a moment—the commission will provide the Government with independent external advice to deliver additional scrutiny of free trade agreements. It will comprise technical experts who can analyse complex treaty text and provide robust and balanced advice to Parliaments. Members of the TAC will be chosen to have knowledge of standards across the whole of the UK. To my noble friend Lady McIntosh, I say that what we are establishing is not a body with a CEO that produces annual reports; it is a group of experts who have a specified task to do, which is put in front of them every time a new FTA comes down the tracks.

Amendment 34 will require the TAC to be reviewed every three years. Of course, I can see from this debate that there is perhaps a misunderstanding among noble Lords about what exactly that means. In my experience, it is good practice for these bodies to be reviewed after a period of time, and three years is not an uncommon period. However, it in no way means that the body will be wound up after that time, because the TAC must stay in place unless the Government bring forward secondary legislation via the affirmative procedure to repeal the TAC’s provisions. There is a review every three years, but only if that review comes forward with recommendations that both Houses of Parliament accept can the TAC be discontinued.

I want completely to reassure noble Lords about the consequences of Amendment 36, which, I fear, has been misunderstood by Members. Amendment 36 is entirely dependent on Amendment 34. Only if the Amendment 34 process every three years resulted in a decision by Parliament that the TAC should be wound up would the provisions of Amendment 36 come into effect to pass the necessary statutory instruments to repeal the TAC. Amendment 36 does not stand alone so it could not be used for the Secretary of State to wind up the TAC on a whim; that would be a ludicrous proposition. I apologise if noble Lords have found the drafting of the amendment confusing in that respect, but I can give them complete reassurance on that matter.

I believe that the role of the statutory TAC complements other measures that the Government have taken to further enhance scrutiny of new FTAs and ensure that the views of the agricultural sector are taken into account during the negotiations process. Indeed, this will not be the only independent scrutiny that our new free trade agreement will receive: the International Trade Committee in the other place and our own IAC will also, of course, provide critical scrutiny and advice on our negotiated deals, just as this took place with the Japan agreement. I reassure noble Lords that the Government remain committed to listening to and engaging with consumers, farmers and industry in negotiating our free trade agreements, and we value the input that they provide in this process.

It is important to remember that our expert trade and advisory groups, representing businesses, consumers and civil society, already provide advice during free trade agreement negotiations—this is an essential difference from the TAC—and we will not seek to duplicate that important work. In particular, there is a dedicated agri-food trade advisory group, in which the agri-foods sector is represented; it does an excellent job of representing that sector.

I believe that these amendments will help the UK safeguard our current standards of agricultural products, put British farming at the heart of our trade policy and ensure that our agricultural sector is among the most competitive and innovative in the world. I hope that noble Lords will be able to support the amendments brought forward by the Government.

On the amendment tabled by the noble Lord, Lord Purvis of Tweed, as I have already mentioned, the TAC will be an expert committee; members will be independent experts, appointed as individuals, not as representatives of academia, business or other organisations for which many of them may work. As I said before, the Secretary of State will make appointments in line with established protocols, following the usual public law principles applicable to all ministerial decision-making. The statutory TAC will represent an evolution of the current TAC to reflect its purpose as set out in Amendment 33. Of course, the membership will be considered accordingly. We are committed to ensuring that only expertise will drive the appointment of new members. It is critical for the success of the TAC that the advice is independent and underpinned by the expertise listed in the amendment.

As I have said before, the central purpose of the TAC is to improve scrutiny of FTAs prior to their ratification. Therefore, as I said earlier, it is related to a reserved matter: the ratification of free trade agreements. As such, the TAC amendment does not engage the legislative consent process under the Sewel convention. While we acknowledge, of course, that the work of the TAC will touch on the devolved matter of agriculture, this does not alter the fact that its function relates to a reserved matter.

However, the UK Government recognise that, as agriculture is a devolved matter, the devolved Administrations, of course, have a legitimate interest in the TAC’s work. Therefore, the Minister of State for Trade Policy has written to them, seeking their views on the statutory TAC, and he will discuss it with them at the ministerial forum for trade later this week. I hope that noble Lords understand that the commitments that we have made, when pulled together, create a further commitment to produce a report on standards in FTAs in relation to specific concerns, as outlined in Section 42 of the Agriculture Act. Through our amendment, we are proposing to put the Trade and Agriculture Commission on a statutory footing—I sense that noble Lords welcome this—and to provide advice in relation to this. I therefore ask my noble friend to withdraw Amendment 7.

[The Deputy Speaker (Lord Alderdice) (LD)]

I have received a request to ask a short question from the noble Lord, Lord Grantchester, so I call the noble Lord to ask a short question of elucidation.

[Lord Grantchester (Lab)]

I thank the Minister for his extensive explanations behind his amendments, although, obviously, I will look carefully at Hansard later, and we may further follow up aspects of this. I would like to draw out from him one further explanation. I listened carefully to his explanations, and I concede that due process would take place before Amendment 36 was invoked and after Amendment 34 had been implemented. But what could be the circumstances in which a review would give rise to an abandonment of the TAC process in future trade assessments?

--- Later in debate ---

[Baroness McIntosh of Pickering (Con) [V]]

My Lords, I am grateful to all who have spoken in this debate and in particular to the Minister for his response to the concerns that have been raised. His conclusion backs ours; nearly everybody who has spoken has spoken in favour of the permanency, beyond an initial three or six years, of the TAC. He himself just accepted that in his last few words.

To come back to the basic points: we all agree it is excellent that the government amendments put the TAC on a statutory footing. In the words of my noble friend Lady Jones of Moulsecoomb, that goes a little way but not far enough towards independence.

I am not sure I got an answer on which resources will be allocated. I realise it is not our place, in this House, to say that, but we did not get an answer on it. On the question of permanence, I will revert to that.

The noble Baroness, Lady Henig, identified a gap in all the amendments—government amendments and Amendments 7 and 44—in a lack of understanding about what government strategy for trade will be. I agree with her on that. Why would we want to tie ourselves to all these commitments, which, inevitably, a CPTPP free trade agreement would involve, when we are tying ourselves up in knots regarding those with the EU? It also begs the question of why we have committed ourselves to a strict regime on state aid with the Japan free trade agreement, which goes further than what we are currently willing to agree to in a future trade agreement with the EU.

The noble Lord, Lord Grantchester, put his finger on the point in his last question, but also on the fact that the matter of standards is unfinished business, which we have carried over from the Agriculture Act. I join other noble Lords in paying tribute to all the farm organisations—the NFU, the TFA, the CLA and all the green organisations, which have been united with the public. The noble Baroness, Lady Boycott, mentioned the 1 million signatures we had that gave rise to amendments in this group, which were previously tabled during the passage of the Agriculture Bill.

My noble friend Lord Caithness was right to stop at one and a half cheers. Both he and the noble Lord, Lord Curry of Kirkharle, have identified the need to know more about what the membership of the Trade and Agriculture Commission will be going forward Although my noble friend the Minister has put a little more meat on the bones, it is still vague.

I did not understand entirely whether the relevant committee, especially in the Commons, will be entitled to do a public appointment hearing regarding the future chair, or the reappointment of the current chair, of the TAC. My noble friend may have misunderstood the role of human rights issues and employment law in this regard. These are now standard in agreements before the World Trade Organization and international agreements, so I am slightly surprised that he thought I was seeking to undermine the Equality and Human Rights Commission in this country, which of course was not my intention.

On independence, I am not sure that we are 100% where we should be, certainly on resources. It would have been helpful to have further clarification. I have made my point about how appointments should be scrutinised by the relevant committee and I stand by that. I am sorry if I did not hear my noble friend confirm that. Also, when my noble friend says that reports on agreements will be “laid before Parliament”, I presume he means that they will be debated and voted on in the usual way.

It would be more helpful than anything else if my noble friend would withdraw government Amendment 36 at this stage. I do not think that it has been drafted clearly and it does not sum up the debate that we have heard on this group. What compounds this is that, on a closer reading of government Amendment 34 on which my noble friend has relied in summing up his arguments, the review to which he has referred, in subsection (4) of government Amendment 34, allows that, in subsection (6B) of proposed new Section 42 of the Agriculture Act:

“The Secretary of State may by regulations repeal subsections (4A), (4B) and (6A), and amend subsection (5) to remove reference to advice requested in accordance with subsection (4A)”


That of course is the very advice that is the subject of this group of amendments: requesting advice from the Trade and Agriculture Commission on the matters referred to in subsection (2) of the new clause

“except insofar as they relate to human life or health.”

I also did not quite understand what the Minister said in summing up how the Government will report. He said that the TAC will report on so much as regards advice, but not on public health. He did not outline how or when that duty will be exercised in terms of future trade agreements, which body would be doing those, and to whom that advice would be tendered if it is not going to be tendered by the Trade and Agriculture Commission.

I think that the will of the House has been expressed strongly this evening that public health and food security should continue to be included. I do not know whether I have an opportunity to revert to my noble friend to answer those two points before I decide whether to withdraw my Amendment 7.

[The Deputy Speaker (Lord Alderdice) (LD)]

Is the noble Baroness withdrawing her amendment? I cannot hear a response.

[Baroness McIntosh of Pickering (Con) [V]]

I am so sorry. I am seeking clarification as to whether it is the Government’s intention to withdraw Amendment 36 this evening.

--- Later in debate ---

Amendment 7 disagreed.

[The Deputy Speaker (Lord Alderdice) (LD)]

My Lords, we now come to the group beginning with Amendment 8. I remind noble Lords that Members other than the mover and the Minister may speak only once and that short questions of elucidation are discouraged. Anyone wishing to press this or anything else in this group to a Division should make that clear in debate.

Amendment 8

Moved by

Export Control (Amendment) (EU Exit) Regulations 2020

Lord Alderdice Excerpts

Wednesday 2nd December 2020 Grand Committee

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

The Grand Committee stands adjourned until 5.30 pm. I remind Members to sanitise their desks and chairs before leaving the Room.

United Kingdom Internal Market Bill

Lord Alderdice Excerpts

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

[Lord Thomas of Cwmgiedd (CB) [V]]

I speak to oppose the inclusion of Clause 50 in the Bill. It is important to distinguish between what I spoke about on the last occasion the Bill was before the House: under Clause 48, what regime is to govern EU structural funds in future. This clause deals with state aid.

Both clauses have one thing in common: they seek to alter the devolution schemes as they stand, for economic development powers are devolved. For example, in respect of Scotland, paragraph 4(1) of Part 3 of Schedule 5 to the Scotland Act makes that clear. The position at present, therefore, is that it is for Scottish Ministers, Welsh Ministers and Ministers in Northern Ireland to determine what financial assistance is provided, in the same way as they determine how the structural funds are dealt with.

State aid is of obvious, considerable importance. It can help to address market failures and provide incentives for research and development, of which the noble Baroness, whom it is a privilege to follow, has spoken. They also deal with areas where the Government want to deal with strategic objectives, such as promoting the use of green technologies or promoting more sustainable agriculture.

Of course, state aid can be harmful if it is not directed in the same way; that is why there must be some form of regime in respect of state aid. The present position on state aid is, as we remain part of the European Union regime, that the devolved Governments make the decisions within the EU regime. In consequence—and it has been during the whole period of devolution—state aid is not a reserved matter. It is devolved.

The British Government’s stated position had been to retain the EU regime and put in place an independent body to police it in place of the Commission, as has happened in respect of other parts of the regime that still governs us but will not do so for much longer. That obviously would not have required any change to the devolution scheme. However, the present Government have decided to change this. They intend to use their Henry VIII powers to do so by statutory instrument. However, they have not consulted on what they want to put in its place, and seek agreement and the views of industry and others, in particular the devolved Governments. As in the other parts of this Bill, the UK Government want to do so without reference to working with the devolved Governments within the devolution schemes. However, in this case, they have hit the snag to which I have referred: they lack the power to do so. State aid and schemes are not reserved.

Clause 50, therefore, seeks to make state aid a reserved matter by what I regret to call a “device” of extending the competition reservation so that it can be used, in effect, to direct policy on state aid. This is not the way to proceed. A regime for state aid subsidies is needed unless, within the current negotiations, we agree to some arrangement that mirrors those of the EU. As is clear from the recently published IfG paper, Beyond State Aid, there are many reasons why a state aid regime is essential, but we need a properly thought-through regime before we legislate, including thinking through the role of the regulator. Such proposals should have been set out before we considered such a clause as this. They should have been consulted on and agreed with all the relevant interests—businesses, universities and others.

Furthermore, the regime to be put in place would have to command the confidence of the devolved Governments, who are responsible, under the devolution schemes, for economic development. Bodies within England also have economic development responsibility. After all that consultation, it should have been determined how this would best be implemented. One way of proceeding would be a common framework with an independent regulator such as the CMA, but a decision would have to be made on the kind of regulator wanted. Would it be the kind of light-touch regulator that some have suggested, with an advisory role, or one with policing powers? If it was a light-touch regulator, to whom would it report—to the UK Government only or to the devolved Governments as well?

Tackling all of this without a policy and through the back door is wrong, as I see it. That course of action also has long-term implications. Proceeding in this way will set policy on the legal basis that it is designed to avoid anti-competitive practices. It will not be based on a forward and positive way of setting out a policy based on looking for economic development.

Therefore, in opposing the inclusion of this clause in the Bill, in short, it is wrong to change the devolution arrangements in this way and without any consultation about the future regime, let alone agreement on it having been reached. I have no doubt that we need a competition regime and that it will need some kind of advisory or other independent policing body. However, we should do this in the proper way and not rush to do it by putting a clause such as this in the Bill. It should not stand part of the Bill.

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

The noble Lord, Lord Purvis of Tweed, has withdrawn, so I call the noble Baroness, Lady Finlay of Llandaff.

[Baroness Finlay of Llandaff (CB) [V]]

My Lords, like other noble Lords, I pay my respects to the memory of Lord Sacks. His loss is immeasurable, and I am sure he would have contributed enormously this evening.

I have put my name to the proposal of my noble and learned friend Lord Thomas of Cwmgiedd that Clause 50 should not stand part of the Bill for a number of reasons. First, the clause is in direct contradiction to Ministers’ assertions that the Bill does nothing to remove powers from the Senedd. If that is the case, why is a new reservation necessary?

Secondly, and related to this, is the conundrum that the Government insist that state aid is already reserved. This position has long been strongly contested by the devolved Governments, who have always operated the state aid system, as the UK Government do in England. If there is doubt about the current legal disposition, would it not be better to ask the courts to interpret the meaning of the current reservation and whether it does or does not include state aid?

Thirdly, although I am no expert, I understand that the Government have been resisting pressure from the European Union during the still-ongoing negotiations to keep in place a state aid framework broadly similar to the one we have inherited through our membership of the EU. Indeed, the statutory instrument to revoke all state aid law is before this House. Why are a Government that seem so reluctant to commit to a rules-based system also so eager to take to themselves absolute power on this vital area of economic development policy?

The devolved Governments in Cardiff and Edinburgh are both in favour of retaining this framework in retained EU law. It is a clear system that provides a bulwark against the arbitrary use of public subsidies to support businesses in favour with the Government or to attract investment, something that is a real risk. Having the protection that this current situation affords for the Governments of the smaller nations of these islands is important because, at the end of the day, the UK Government in their “Government of England” mode can always trump any financial incentives that the devolved Administrations could offer in some kind of dog-eat-dog contest. This clause simply feeds the suspicion that, rather than maintaining a level playing field across the UK, this element of the Bill is about giving the Government the maximum freedom to do what they like with the system and channel investment to marginal Conservative seats.

Fourthly, it is probable that, despite their effort, the Government do indeed sign up to an agreement with the EU that requires the enhancement of a new system of state aid. I hope that the term “subsidy control” evaporates in the way the “implementation period” seems to. If that is the case, then the devolved institutions will have to conform to those new rules because they flow from an international treaty obligation, so this new reservation will be unnecessary.

Finally, I turn to what this clause, like so much else about this Bill, says about the Government’s approach to devolution. Quite simply, it would seem that they do not like it, would prefer it not to exist and want simply to pay lip-service to it. This is a Government that do not seem to tolerate any source of law and public policy that they cannot control and, having removed the rival source of authority of the EU, seem to be gunning for other bodies that have the power to make primary legislation. This is not just distasteful; it is profoundly dangerous for those of us who care deeply about the union. I appeal to the Government to rethink their approach urgently because, otherwise, they will see the country gradually disintegrate in front of their eyes.

[Viscount Trenchard (Con) [V]]

My Lords, when I read the three amendments of my noble friend Lady Rawlings, I was not sure exactly what had driven her to propose them. Of course, I am aware that my noble friend is a distinguished former chairman of King's College London and, therefore, well aware of the importance of research and development grants. I recognise the importance of regulating the provision by public authorities of subsidies that may be distorting or harmful.

I had thought that Clause 49 makes it clear that financial assistance for economic development may be provided in a number of forms, including grants. However, I sympathise with my noble friend’s view, which she clearly explained in her impressive speech, that R&D grants should be incorporated to safeguard against unfair state aid masquerading as legitimate subsidies. I would like to hear the opinion of my noble friend the Minister on this question.

Regarding the proposal of the noble and learned Lord, Lord Thomas of Cwmgiedd, that Clause 50 should not stand part of the Bill, although I have the greatest respect for his opinions and was impressed by his characteristically clear explanation of his reasons, I believe it is still necessary for this clause to protect against the undesirable possibility that the devolved authorities might otherwise adopt significantly different regulations on this. I look forward to hearing what my noble friend the Minister has to say about this amendment and the need for a single nationwide state aid regime.

[The Deputy Chairman of Committee (Lord Alderdice) (LD)]

The noble Baronesses, Lady Bowles of Berkhamsted and Lady Neville-Rolfe, have withdrawn, so I call the noble Lord, Lord Fox.

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[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

The noble Baroness, Lady Bennett of Manor Castle, has also withdrawn, so I call Lord Stevenson of Balmacara.

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords, I thank the noble Baroness, Lady Rawlings, for introducing her amendment. She made her case extremely well: R&D is important, and the Government could easily, with advantage, accept all three of the amendments as they stand. However, her introductory speech raised all the issues that have subsequently been picked up by other speakers, because we are facing what appears to be another black hole in this Bill. The noble and learned Lord, Lord Thomas, the noble Baroness, Lady Finlay, the noble Lord, Lord Fox and I have signed up to an amendment more in frustration than any genuine feeling that the existing clause is wrong, although the noble and learned Lord, Lord Thomas, does make a very good case for how the procedures adopted there are not the ones that should be seen in the final version of this Bill.

The question really seems to be about what our state aid regime is going to be. Is it going to be central or devolved in terms of both its process and delivery? Is there going to be a central body that will be charged with making sure that all those participants who benefit from state aid do so on a fair and open basis, and are they going to be able to review and make recommendations for how it is taken forward?

It seems to me this is another area where common frameworks have an opportunity to provide the solution to a problem the Government are facing. I hope that whichever way we go on this, time will be taken to make sure we get it right, do it properly and come forward with something that will justify the effort that has been placed in it, because it will be worth it.

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)]

My Lords, I thank noble Lords who have taken part in this debate. I recognise that the hour is late, so I will attempt to be as brief as possible. I begin by setting out why Clause 50 should stand part of the Bill, before moving on to discuss Amendments 169A, 169B and 169C.

Clause 50 reserves for the UK Parliament the exclusive ability to legislate for a UK subsidy control regime in future. The Government have always been clear in their view that the regulation of state aid, which is the EU approach to subsidy control, is a reserved matter. Let me say in reply to the noble Lord, Lord Fox, that the devolved Administrations have never previously been able to set their own subsidy control reviews, as this was covered by the EU state aid framework. Now we have left the EU, we have an opportunity to design our own subsidy control regime that works for the UK economy.

It is important, in our view, that there continues to be a uniform position across the United Kingdom. Reserving will ensure we take a coherent and consistent approach to the way public authorities within the UK subsidise businesses, supporting the smooth functioning of the UK’s internal market. A unified approach will reduce uncertainty for UK businesses and prevent additional costs in supply chains and to consumers.

Also in reply to the noble Lord, Lord Fox, I say this reservation does not impact the devolved Administrations’ existing spending powers. The devolved Administrations will continue to make decisions about devolved spending on subsidies—how much, to whom and for what—within any future UK-wide subsidy control regime.

The Government announced in September that the UK will follow World Trade Organization rules for subsidy control from 1 January. These are internationally recognised common standards for subsidies. Before the end of the year, the Government will publish guidance for UK public authorities to explain these rules and any related commitments the Government have agreed in fair trade agreements. We will also publish a consultation in the coming months on whether we should go further than those existing commitments, including whether or not legislation is necessary, because we want a modern system for supporting British business in a way that fulfils our interests. We do not want a return to the 1970s approach of Government trying to run the economy or bailing out unsustainable companies. We will take the necessary time to listen closely to all those with an interest in this subject.

UK government officials have been meeting, and will continue to meet, their devolved Administration counterparts on a regular basis. We are keen to ensure that the devolved Administrations are involved in the upcoming consultation process. I hope that noble Lords will agree that this approach is the best, and indeed the only, way to ensure that the whole of the UK can benefit from having a consistent and coherent system of subsidy control, which is necessary to support the smooth running of the UK internal market. I therefore commend that Clause 50 stands part of the Bill. I hope that I have answered at least some of the questions from the noble Lord, Lord Fox. If not, I will write to him to confirm the other points.

I turn to Amendments 169A, 169B and 169C, in the name of my noble friend Lady Rawlings. They seek to amend the definition of a subsidy for the purpose of their reservation. They would add to this definition that a subsidy will also include “research and development grants”. The interpretation provisions contained in Clause 50 set out what is classed as a subsidy for the purpose of this reservation. We define a subsidy as including assistance provided to a person, directly or indirectly, financially or otherwise. The definition includes examples of this assistance as income or price support, grants, loans and guarantees.

For the purpose of the reservation of subsidy control, the definition of a subsidy is deliberately broad to ensure that we have sufficient scope to design a future domestic regime that meets the needs of the United Kingdom. To ensure that we cover a broad range of financial interventions, the definition is not currently limited by reference to any specific policy purpose or sector. Subsidies may be given for a variety of purposes, and it would be anomalous to single out just one of them here. The current wording in the clause already encompasses assistance provided to a person directly or indirectly by way of grants and is therefore sufficient to cover research and development grants as my noble friend intends. Therefore, the Government do not think that the amendments are legally necessary. I hope that, in the light of that information, my noble friend will be able to withdraw her amendment.

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

I have received a request to speak after the Minister from the noble Lord, Lord Fox.

[Lord Fox (LD)]

With every answer, there come more questions, I am afraid. The Minister sought to explain that the devolved authorities will still be able to spend the money—I think those were the words that he used—but I am interested to know to which money he is referring. How in future will they get their hands on the money? Will there be a competitive bidding process? Is it part of the formula? Is that the money that he is talking about? Perhaps he could outline what he means by “the money”, because it is not entirely clear to me. He is looking at me as though I am being slightly stupid and I shall be very happy to be educated by him in writing rather than verbally.

United Kingdom Internal Market Bill

Lord Alderdice Excerpts

Committee stage & Committee: 3rd sitting (Hansard) & Committee: 3rd sitting (Hansard): House of Lords
Monday 2nd November 2020 Lords Chamber

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

I have received requests to speak after the Minister from the noble and learned Lord, Lord Falconer of Thoroton, and the noble Lord, Lord Fox.

[Lord Falconer of Thoroton (Lab)]

The noble Lord, Lord Callanan, referred to the idea of new professions being invented. If this happened, there would be a professional body that would need government recognition in some form. Could he give us an example, perhaps, of a new profession emerging without a professional body in relation to which there is a substantial risk? If there is no such example or evidence, it is incredibly unconvincing. The second and separate example he gave was an existing profession giving rise to a particular requirement that would create a barrier to entry in one part of the United Kingdom for another. Could he give an example of when that has happened in the past?

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[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

I have also received a request from the noble Lord, Lord Purvis of Tweed, but I first call the noble Lord, Lord Fox.

[Lord Fox (LD)]

My Lords, with all due respect to the Minister, I am sure he understands how unsatisfactory that answer was. My noble friend Lord Thomas of Gresford talked about the gobbledegook of future-proofing, and this is gobbledegook. First, could the Minister tell your Lordships’ House what past examples lead the Government today to this conclusion? Secondly, why is there a problem with bringing any future issues to the Government and your Lordships’ House bespoke in the event that the Minister proves correct and something turns up? To seek to produce a Bill that covers all of the unknown unknowns that are going to happen in the history of time seems overambitious.

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Amendment 109 not moved.

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

We now come to the group beginning with Amendment 110. I remind noble Lords that anyone wishing to speak after the Minister should email the clerk during the debate. Anyone wishing to press this or anything else in this group to a Division should make that clear in the debate.

Clause 28: Functions of the CMA under Part 4: general provisions

Amendment 110

Moved by

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[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

The noble Lord, Lord Liddle, has withdrawn, so I call the noble Lord, Lord Naseby.

[Lord Naseby (Con)]

My Lords, when I first read through the Bill, I had some reservations about the CMA, not least because of the number of its investigations that have not exactly gone smoothly, as my noble friend Lady Noakes referred to. As all noble Lords are aware, it arose from its antecedent, the old Monopolies and Mergers Commission. I voiced some of those reservations at Second Reading. I then had another look at the OIM and could not for the life of me understand why it did not have its own status. How could it be right for it to be almost subservient to the CMA? I could immediately see a clash of interests. As has just been said, its role is to monitor, advise and report. That may well clash with the basic element of the CMA. While this amendment may not be exactly right, there is a strong case for it.

I will give an example. I have recently been approached by some outside people because they know that I take an interest in the credit lending market, principally credit unions. It is a difficult market because there is the FCA, which does a good job on the whole, but there is also the ombudsman. People who are in difficulty with credit are prone to appeal to the ombudsman for better treatment, as it goes beyond the normal provisions under which the FCA works. That created a real problem for the genuine lenders—not the fly-by-night operators—because of a clash of interests.

I would not expect my noble friend on the Front Bench to respond in any detail today, but the OIM has to have its own status. It should not be in a position where it is embarrassed by the CMA going against what the OIM thinks is appropriate in any situation.

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[Lord Callanan (Con)]

My Lords, I thank everyone who has participated in this group. I will seek to take forward the suggestion of the noble Baroness, Lady Hayter, that letters be copied around—I have another batch on my desk to approve once we have finished this debate, many of which, I am sure, are to my Liberal Democrat colleagues. I will ensure that they are circulated to all the protagonists. They are not particularly secret; they just help to clarify and explain the Government’s role and answer the many questions that we have been asked. I hope that is helpful.

I will start with Amendment 110, which seeks to replace Clause 28 with a new clause on the establishment of the Office for the Internal Market. As noble Lords will know, this Bill will create an Office for the Internal Market within the Competition and Markets Authority to carry out a set of independent advisory, monitoring and reporting functions to support the effective operation of the UK internal market. The proposed new clause seeks to create a new and separate public body that reports to the BEIS Secretary of State. The effect would be not to establish the Office for the Internal Market within the Competition and Markets Authority.

Let me say in response to my noble friends Lady Neville-Rolfe and Lord Naseby and the noble Baroness, Lady Hayter, that the Government did consider a wide range of delivery options for the advisory, monitoring and reporting functions of the UK internal market, as set out in the Bill. We concluded that the Competition and Markets Authority is best suited to house the OIM to perform these functions. The CMA is an independent non-ministerial department that currently operates at arm’s length from the Government. It is sponsored by BEIS and Her Majesty’s Treasury and—to answer the question posed by my noble friend Lady Neville-Rolfe—Ministers will be responsible to Parliament in reporting on the work of the CMA and the Office for the Internal Market, even though they operate at arm’s length.

The Competition and Markets Authority has built up a wealth of expertise and experience that makes it a natural fit to take on these additional functions. It has a global reputation for promoting competition for the benefit of consumers and for ensuring that markets work well for consumers, businesses and the wider economy. It will also build on the CMA’s existing technical and economic expertise, which will now support further development of the UK internal market.

I should also explain that it is government policy that new arm’s-length public bodies should be only set up as a last resort and when consideration of all other delivery options has been exhausted. Other delivery options that should be considered include utilising existing bodies in order to deliver any new functions. New public bodies should be created only if there is a clear need for the state to provide the function or service through a public body and if there is no viable alternative—effectively establishing new public bodies as a very last resort. For the reasons that I have set out, we are not able to agree with this amendment. I hope that my noble friend Lady Neville-Rolfe will feel able to withdraw it.

Regarding Clause 28 stand part, this clause defines regulatory provisions on which the CMA, through the OIM, will monitor and provide reports and advice. The purpose is to set out the areas where the OIM will perform functions under the Bill, in order to ensure certainty and transparency for Administrations, businesses and the general public in connection with the effective operation of the UK internal market. Regulatory provisions are within scope if they set requirements for the purposes of the mutual recognition and non-discrimination principles of the Bill for the sale of goods and the equivalent for services. Moreover, regulatory provisions are within scope if they apply to one or more nations but not the whole of the United Kingdom. Clause 28 as it stands forms an integral part of the provisions for the OIM to carry out its independent, advisory and reporting duties in respect of the UK internal market. For these reasons, therefore, I am unable to accept the proposal that Clause 28 should not stand part of the Bill.

On Clause 29 stand part, removing Clause 29 would remove the Competition and Markets Authority’s objective when exercising its functions as the Office for the Internal Market. This clause designates the CMA, in its capacity as the OIM, as having a specific role in the operation of the UK internal market. It is additionally important to note that this clause establishes the statutory objectives of the CMA in its capacity as the OIM. This clause will ensure that the CMA in its OIM role is able to operate effectively as the monitoring body for the internal market, and will ensure there is no confusion between the pre-existing powers of the CMA and those newly conferred upon it as the OIM. Distinct objectives will prevent any operationally problematic blurring of functions. Clause 29 as it stands forms an integral part of the provisions for the OIM, and therefore we are unable to leave it out of the Bill.

Moving on to Clause 41 stand part, removing this clause would leave out vital definitional provisions. This clause provides key definitions for the purposes of this part of the Bill. This includes a definition of the Competition and Markets Authority itself and sets out how widely the operation of the internal market in the United Kingdom should be understood. This clause also defines “Relevant competence” in Part 4 as meaning both reserved and devolved competence so that executive and legislative competence in each territory is included. Clause 41 as it stands forms an integral part of the provisions for the CMA in its capacity as the Office for the Internal Market: it ensures legal clarity and certainty on technical terms used throughout this part. For all those reasons, therefore, I am unable to accept the removal of this clause.

Amendment 111 would require the CMA to not engage in any form of dispute resolution while fulfilling its responsibilities as outlined in Part 4. This addresses the points made by the noble Lord, Lord Palmer. In cases of disagreement between one or more Administrations, the OIM, within the CMA, could be called upon to provide a non-binding report to support intergovernmental discussion. An assessment of economic impacts will ensure a technical underpinning to an otherwise political discussion.

Ultimately, the OIM only supports the resolution of disputes among the Administrations politically, and it does not adjudicate. The Government believe that building upon existing intergovernmental arrangements is the best approach to resolving any potential disputes, and this includes mechanisms such as common frameworks and intergovernmental relations, according to a clear and agreed process. The OIM will have its role in disputes between individuals and businesses, but businesses can request that the OIM consider disputes as part of its regular reporting. It is under no obligation to do so, nor will it have the authority to adjudicate on the specific issues.

Amendment 113 would prevent the necessary flow of information from the Competition and Markets Authority to the Secretary of State as the policy’s sponsor. The clause in question allows the CMA to alert the Government when it thinks adjustments may be needed to the way it fulfils its statutory functions, or it wishes to raise issues of particular concern. This is in line with precedent for similar public bodies and mirrors provisions in the existing legislation underpinning the CMA. Removing this provision would hamper the necessary communication between the Government and the CMA across all the other provisions in Part 4. For that reason, we are unable to accept the amendment.

Amendment 155 would make it an explicit statutory duty of the CMA, under its existing duties within the Enterprise and Regulatory Reform Act 2013, to protect and promote the interests of consumers in respect of the internal market. The clause in question establishes the statutory objective of the Competition and Markets Authority in its capacity as the OIM. It will ensure that the office is able to operate effectively as the monitoring body for the internal market and that there is no confusion between the pre-existing powers of the CMA and those newly conferred upon it. Distinct objectives will prevent any operationally problematic blurring of functions. The OIM will operate for the benefit of all those with an interest in a smoothly functioning internal market, be they regulators, businesses, professionals, the four legislatures or consumers. Explicitly narrowing its focus to consumers would, in our view, be to the detriment of all the other stakeholders I have listed. Therefore, I am unable to accept the amendment.

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

I have received a request to speak after the Minister from the noble Lord, Lord Fox.

[Lord Fox (LD)]

My Lords, I am grateful for the Minister’s response. In her speech, the noble Baroness, Lady Bowles, asked some very specific questions, particularly in the stand part bit of her speech. I listened hard but I could not hear any answers to them, so perhaps the Minister could review her speech and write a letter, promptly, making sure that I and the noble Baroness, Lady Hayter, get a copy.

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Clause 29 agreed.

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

We now come to the group beginning with Amendment 114. I remind noble Lords that anyone wishing to speak after the Minister should email the clerk during the debate. Anyone wishing to press this or anything else in this group to a Division should make that clear in debate.

Clause 30: Office for the Internal Market panel and task groups

Amendment 114

Moved by

United Kingdom Internal Market Bill

Lord Alderdice Excerpts

Committee stage & Committee: 2nd sitting (Hansard) & Committee: 2nd sitting (Hansard): House of Lords
Wednesday 28th October 2020 Lords Chamber

Amendment 174 would place a duty on Ministers and others involved in making legislation to have regard to the need to establish and maintain a high level of protection in respect of regulatory aims. The UK Government are of course committed to maintaining high standards across the UK. However, the proposed clause as constituted would create difficulties of defining and therefore assessing what is meant by levels of protections and standards. The proposed clause also implies that there may be a compulsion on Ministers to lower standards. This would contradict the explicit commitments made in our Conservative manifesto to raise standards on workers’ rights, agriculture, animal welfare and the environment. The Government expect to use the pragmatic and productive collaboration with the devolved Administrations to continue to enable us to maintain high standards across the UK. In the light of that information, I hope that the noble Baroness will feel able to withdraw her amendment.

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

I have received a request to speak after the Minister from the noble Lord, Lord Fox.

[Lord Fox (LD)]

I sometimes wonder whether the Minister sustains himself through the long periods of Committee by imagining himself throwing off the yoke of hideous EU conformity. In fact, nothing could be further from the truth. How does the noble Lord explain all the examples of diversity across the four nations of the United Kingdom if there is this conformity? How can his comment that the market has worked very well for 20 years stand up, if this conformity was so bad? Indeed, the 2020 assessment by the Government of the frameworks says that they will maintain, as a minimum, equivalent flexibility for tailoring policies to the specific needs of each territory, as afforded by the current EU rules. The Government clearly recognise the flexibility in the current EU rules.

I commend the Minister for getting through that lengthy statement without once mentioning the words “common frameworks”. There is still no explanation of how the common frameworks inform the Government’s view today of the internal market. Will he please answer that question?

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Clause 13 agreed.

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

We now come to the group beginning with Amendment 66. I remind noble Lords that anyone wishing to speak after the Minister should email the clerk during the debate. Anyone wishing to press this amendment or anything else in the group to a Division should make that clear in the debate.

Clause 14: Interpretation of references to “sale” in Part 1

Amendment 66

Moved by

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[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

The noble Lord, Lord Liddle, has withdrawn, so I call the noble Lord, Lord Purvis of Tweed.

[Lord Purvis of Tweed (LD)]

My Lords, I am grateful to the noble Baroness, Lady McIntosh of Pickering, for putting down this question. The Law Society of Scotland makes a valid point about why there would be a new, and potentially competing, definition of sales between this legislation and the Sale of Goods Act. I will just ask two supplementary questions. The first is a genuine probing question about the Government’s view. Given that many sales are conducted online now—and probably the vast majority in the coming years—what is the Government’s view, with regard to this legislation, on the location where an online sale takes place and how that is covered by the definition?

The example given by my noble friend Lord Fox was about phasing in the banning of coal in England, but not yet in Wales or Scotland. It was a genuine question, and it was a shame that the noble Lord, Lord Callanan, did not have a chance to answer. On a reading of this legislation, someone in England who is banned from purchasing coal for use in their household in England would, under the definition of “sale” in Clause 13, be able to buy household coal from a Welsh or Scottish coal merchant, at a local or online sale, who would then be able to deliver. It would be good if that could be clarified, even if the Minister needs to write to us about it. It is a genuine issue to highlight.

My second question links to this amendment more directly. The noble Baroness, Lady McIntosh of Pickering, and other noble Lords who have Scottish legal qualifications will be familiar with this. I see the noble and learned Lord, Lord Falconer, on the Opposition Front Bench. Sales in Scotland often have a cut-and-paste element, stating that the law of contract of England applies. Of course, it does not in Scotland. That tends to be viewed as not having effect, and that the cut and paste is not accurate, as contract law is different north of the border. When it comes to the definition of sales through a contract, if the sale of an imported good is conducted within Scotland, is it considered local or not? If that is the case, does the contract law of Scotland apply under this legislation or is the default the law of contract for England? If the latter, that is problematic for transactions carried out north of the border.

[Baroness Bloomfield of Hinton Waldrist (Con)]

My Lords, I thank noble Lords for their contributions to this short debate. There were a lot of questions in there, some of which I will just have to write to noble Lords about because my briefing does not cover the whole gamut of what was asked and I would rather give a full answer.

Amendments 66 and 67 are relatively technical amendments relating to the definitions of “sale” in the Bill. I am willing to provide further details on this issue and discuss any concerns that my noble friend has. Amendment 66 would narrow the definition of “sale” in the Bill. It would narrow the types of supply-related activities that a trader could carry out and benefit from the market access principles. It would therefore reduce the effectiveness of the market access principles in reducing barriers to trade across the UK.

The United Kingdom Internal Market Bill is intended to provide a structural underpinning and additional protections to the status quo of intra-UK trade, ensuring certainty for businesses and investors in the form of a safety net of regulatory coherence. We should not cut holes in the safety net. The definition of “sale” that we have will ensure that businesses can continue to trade in a frictionless way, no matter how they are supplying their goods. It also seeks to align broadly with the scope of the “placing on the market” concept that is central to our existing goods regulation.

I say to my noble friend Lady McIntosh that the Sale of Goods Act 1979 was a very UK-specific way of defining a sale. The EU style of definition that has been brought into our legislation is much broader, and there is a need to ensure that the same principles align across the whole legislative piece. “Placing on the market” is therefore included in this as a concept but not in the Sale of Goods Act. In short, the Government cannot support this amendment, and I ask my noble friend to withdraw it.

Amendment 67 would exclude the supply of goods free of charge from the market access principles. It would include the rental of goods, as the noble Lord, Lord Purvis, pointed out. That would lead to the strange outcome that a good could be lawfully sold under the mutual recognition principle in a part of the UK for only a penny but could not be supplied there under that principle free of charge. This would affect a range of items such as commercial samples, marketing merchandise or introductory offers, and would reduce the effectiveness of the market access principles in reducing barriers to trade across the UK.

I was asked a question by the noble Lord, Lord Purvis, when we were talking about coal. I think the distinction my noble friend was trying to make was between a ban on the sale of coal and a ban on its use. As in his example, you could legally buy it in Wales, but you could not then legally use it in England just because you bought it over the border due to the difference in rules. For these reasons, I ask my noble friend not to move Amendment 67.

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

I have received a request to speak after the Minister from the noble Lord, Lord Purvis of Tweed.

[Lord Purvis of Tweed (LD)]

I am grateful for how the Minister responded. I think that the last point she made was really important. The Government have been talking about restrictions on the ability of the devolved Administrations to sell, yet on the point that my noble friend Lord Fox made—that the Government for England have banned not the use but the sale of household coal—the Minister said that it would be possible to continue to provide household coal in England through a Welsh or online retailer. It is quite extraordinary that the undermining of public policy along those lines could be operated, but the Government seem to be perfectly content about that. However, the transparency on that, at least, has been helpful.

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[Baroness Scott of Bybrook (Con)]

My Lords, these amendments seek to exclude teaching services and the teaching profession from the scope of the mutual recognition principle in Parts 2 and 3 of the Bill. Starting with Amendment 79, the current list of entries in Schedule 2 is largely drawn from the exclusions under the existing framework in the retained EU law. Schedule 2 aims to list those services for which it would be inappropriate to apply either or both of the provisions in Part 2. For example, legal services are excluded in recognition of the long-standing differences between the legal systems in each part of the UK.

I should allay the noble Baroness’s concerns if I explain that public services, including the public education services, are already excluded from the scope of Part 2 of the Bill under Schedule 2. That exclusion will ensure that public education services are not subject to the principles of mutual recognition or non-discrimination in Part 2. For this reason, it is my view that Amendment 79 is unnecessary.

Clause 17 requires the Secretary of State to keep Schedule 2 under review and contains the power to amend it by regulation to add services or requirements to those matters excluded from the principles of mutual recognition and non-discrimination. I can assure noble Lords that the Government will continue to keep the list of exclusions under review to ensure that it includes the appropriate services and requirements, to which either or both market access principles should not apply.

I turn to Amendment 106, which deals with recognition of professional qualifications. I assure noble Lords that teaching standards across the UK are very important to this Government. The provisions in Clause 24 allow relevant authorities to replace the automatic recognition principle with an alternative recognition process if they think that automatic recognition of different UK teaching qualifications would not be appropriate.

We are therefore answering the General Teaching Council for Scotland and the issues brought up about Wales and Northern Ireland; they will still be able to set standards in those devolved authorities, as now, and control who can teach in them. If the General Teaching Council for Scotland or a council in any other devolved authority decides that recognising teaching qualifications from other parts of the UK automatically is not appropriate, it can put in place an alternative recognition process to check qualifications and experience, as set out in the Bill. That should allay a number of the fears brought up in this short debate.

The system will enable relevant authorities to assess an individual’s qualifications before allowing professionals to practise. Relevant authorities will continue to have the ability to refuse access to those who are unable to demonstrate that they meet the standard requirements, such as the Welsh language. This makes an exception for the teaching profession unnecessary. On those grounds, I cannot accept the amendment and hope that the noble Baroness will withdraw it.

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

I have received a request to speak after the Minister. I call the noble Lord, Lord Purvis of Tweed.

[Lord Purvis of Tweed (LD)]

My Lords, I wish to obtain absolute clarity from the Minister on the exemption in Schedule 2 with regard to:

“Services provided by a person exercising functions of a public nature”—


that is, a public body. That may apply to Wales but the General Teaching Council for Scotland is a charity as well as a regulatory body. The Minister outlined what it would be able to do to change, if challenged, those seeking to be registered in Scotland under the English criteria but who do not meet the Scottish criteria. The fear is that because the council is a charity—it is the oldest regulatory body for teachers in the world—it would be forced to accept teachers of a different standard than the English standard, which I automatically assumed would be a lesser standard. Will the Minister clarify that charities, such as regulatory bodies like the GTCS, are included in Schedule 2? She said it applied just to public bodies.

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Amendment 81 not moved.

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

We now come to the group beginning with Amendment 82. I remind noble Lords that anyone wishing to speak after the Minister should email the clerk during the debate. Anyone wishing to press this or anything else in this group to a Division should make that clear in the debate.

Amendment 82

Moved by

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Clause 21 agreed.

[The Deputy Chairman of Committees (Lord Alderdice) (LD)]

We now come to the group beginning with Amendment 102A. I remind noble Lords that anyone wishing to speak after the Minister should email the clerk during the debate, and anyone wishing to press this or anything else in the group to a Division should make that clear in debate.

Amendment 102A

Moved by