Register of Overseas Entities (Delivery, Protection and Trust Services) Regulations 2022

Debate between Lord Clement-Jones and Lord McNicol of West Kilbride

Tuesday 12th July 2022 Grand Committee

[Lord Clement-Jones (LD)]

My Lords, first, I thank the Minister for his introduction and give apologies from my noble friend Lord Fox, who is unavoidably detained up a mountain. He would never normally miss an SI debate for the whole world. It is very good to see the noble Lord, Lord Vaux, in his place, as he played such a prominent role during the Bill’s Committee stage. Like him, I thank the Minister for arranging an extremely interesting and instructive hybrid demonstration of the digital application process, the way that it is put on the register and the way that the register will be maintained.

I want to speak to all three SIs, linked as they are, even if only one needs specific approval today. I welcome the speed at which the register is being brought into effect and echo the Minister’s praises for those who have been responsible for doing so. It goes quite some way to justify the rather cursory nature of the passage of the Act itself.

Of course, we still have unfinished business on the economic crime front and I hope very much that it is actively in the pipeline, to ensure that there are no kleptocrats or oligarchs out there who are unexposed. I hope that part 2 will consolidate the UK’s fragmented and ineffective anti-money laundering supervisory regime and reform corporate criminal liability law to ensure that it includes enablers. Enablers were very much the subject of our discussion in Committee. I hope that it combats the use of strategic litigation against public participation, which stifles public interest criticism of these characters, and empowers and resources Companies House to effectively monitor, verify and investigate suspicious companies. I hope that it will significantly increase resource for law enforcement agencies fighting economic crime and support whistleblowers to play an effective role in tackling economic crime. Could the Minister give us a little indication of when we might expect those goodies in the part 2 Bill?

On Regulation 7, I hope that the provisions regarding not putting information on the public register are rigorously applied. But I think there are questions when one looks through the regulation. Will certain elements of the enforcement and crime prevention authorities be consulted when an application under Regulation 7 takes place? What checks of the evidence provided by the applicant will be carried out? That is going to be an extremely important element to maintain that rigour.

As I said, we have had much discussion about enablers. It seems that those who do not comply with the requirements or make false returns on behalf of clients will be subject only to sanctions by their professional body or regulator. Have I got that right? I believe that that is what the Minister said when we had our demonstration. If that is correct, are there plans in part 2 to have sanctions on those professionals who give false verification under Section 16 of the Act, other than via professional bodies? Otherwise, it seems a very tame way of making sure that those who provide that verification do it honestly and with integrity.

It is notable that in this SI process the Act has actually been improved along the lines suggested in Committee by myself and my noble friend Lord Fox for overseas corporate trusts and nominee companies. I used the example of a Panamanian nominee company with multiple properties to point out the flaws in the original Bill. I believe—and I hope that the Minister can confirm—that that avenue is now completely closed, and that a Panamanian nominee trust company would have to disclose the beneficial ownership of every property in its portfolio.

I see that there is no impact statement. In fact, there is a statement in each SI that there is no impact from any of the SIs. That seems very strange. Is it a technicality? In other words, does the main impact come from the passing of the primary legislation? Or is it the case that this set of SIs and maintaining the register will have no impact? It seems extraordinary to put that statement into these SIs, when what they actually do is put into effect the really important part of part 1 of the economic crime legislation. I hope that the Minister can clarify where the Government believe that the impact is.

I have a little technical teaser for the SI team. I noticed that these regulations are made partly under Section 25(3) but not under Section 25(3)(e) and (g). Given that they are being made under paragraphs (a) to (d) and (f), that seems rather odd. Paragraph (e) is

“recording of restrictions in the register”

and paragraph (g) is

“the charging of fees by the registrar for disclosing information where the regulations permit disclosure, by way of exception, in specified circumstances.”

Since the SI specifically mentions the bits of the Act which are prayed in aid to make the regulation, it would be useful to know why these two paragraphs have been excluded.

We have three SIs here. Are any other SIs needed to bring the register into effect or is that it? Can we say it is done and dusted, all that needs to happen now is that Companies House gets on with it and the register will be open as soon as possible?

Finally, it would be useful to know from the Minister by when he expects the Crown dependencies and overseas territories to introduce public company ownership registers. I believe it was meant to be by the end of the year; are they still on track for that? In the meantime, will the Government ensure that the authorities in those dependencies and overseas territories will proactively share information with UK authorities to enable comprehensive sanctions designations?

[Lord McNicol of West Kilbride (Lab)]

My Lords, I thank the Minister for explaining this instrument. As we know, it implements aspects of the new register of overseas entities, which will finally require owners of UK property to reveal their true identities and crack down on foreign criminals using UK property to launder money. I apologise for not attending the digital presentation, which sounded fascinating. Maybe I can look into that for the future.

As the Minister said, in order to do this, this instrument will require certain documents to be electronically delivered to the Registrar of Companies. It will also set up a protection regime which will allow owners and managing officers of overseas entities to apply to have their information made unavailable for public inspection, where there is evidence that they or someone in their household are at serious risk of violence or intimidation, and will set out that legal entities governed by the law of another country are subject to their own disclosure requirements.

These are all positive steps which we support. However, I think the noble Lords, Lord Vaux and Lord Clement-Jones, and I are looking for a bit more of an explanation so that these protections are not abused. If the Minister could share some of the detail of the protections that will be put in place to stop the overuse or abuse of these protections, I am sure your Lordships’ Committee would be appreciative.

There is a lot to be said here, but of course it has all been said before on many occasions, not least during the passage of the Economic Crime Act through this House in March. As such, I will not keep your Lordships for too long, repeating what has already been said. However, I have some points to make, primarily around the timetabling. The noble Lord, Lord Clement-Jones, picked up a few of those, but I would like to add to them.

There should be nothing controversial about knowing who really owns property in the UK in a healthy, transparent economy and making that information publicly available. Transparency in this area is essential. This is a matter not simply of targeting individuals or entities through sanctions but of fixing a broken system that has helped sustain Putin in his invasion of Ukraine. However, it is not just because of oligarchs and their position in Putin’s regime that this has finally being expedited. Like others, I congratulate the Bill team and the civil servants on their speed in pushing this through. It also deals with money launderers and tax evaders.

Telecommunications (Security) Bill

Debate between Lord Clement-Jones and Lord McNicol of West Kilbride

Committee stage
Tuesday 13th July 2021 Grand Committee

[The Deputy Chairman of Committees (Lord McNicol of West Kilbride) (Lab)]

My Lords, the Grand Committee will now resume. I think we were just about concluding the remarks of the noble Lord, Lord Clement-Jones.

[Lord Clement-Jones (LD)]

I might take that hint, but there is still a little bit of water to flow under the bridge.

The Minister knows that there is already a great deal of concern about both the regulations, which I have specified and gone through to some degree, and the forthcoming codes which we are assured will come out, so there is no doubt that the Government are fully aware of the providers’ concerns.

I thought the point made by the noble Baroness, Lady Merron, on the NCSC’s lack of involvement was very strong. That absolutely must be bolted into the Bill; it is fundamental in so many ways, and I do not think any of us really understands why that should not be bolted in.

I come on to the substance of what the Minister said: that using the negative procedure for the regulations was fine because we are not amending primary legislation. Do we now make a virtue of a non-Henry VIII power? Are the only powers that we think should now be subject to the affirmative procedure Henry VIII powers? We have moved some way. I am clearly getting far too long in the tooth to see those sorts of arguments being made by Ministers, especially when it is a matter of scrabbling around to keep the Bill as it is. I understand the “not invented here” principle, but it is a bit depressing to see it when the merits of a case are so strong.

The other time-old argument is “Don’t worry your pretty little heads; these are technical regulations. Parliamentarians can’t have too much oversight of a technical regulation—they might not understand it. They might get confused and lose sleep.” I do not know what the arguments are, but they are clearly bogus. We should go for the affirmative, and someone with the experience of the noble Lord, Lord Naseby—I am sorry to see he is not here—as a Deputy Speaker in the Commons knows full well that that is the appropriate form.

The words “legislative effect”, which the noble Baroness, Lady Merron, emphasised, as I do, are important in this context, and were raised by the Delegated Powers Committee. On this point about having no delay, regulations needing to be updated, and a code of practice needing to be flexible and updated, we have seen that this Government can pass Covid-19 regulations in a blink; they can do virtually anything they feel like at the drop of a hat and nobody says boo to a goose, so I do not think that is a very useful argument.

The other point the Minister made was that the code needs to be understood by its audience. Again, that is a “Don’t worry your pretty little head” argument—“Parliamentarians will not understand the code—it is not relevant to them; only the providers need to worry about it.” But providers are worried about the code, and they would be much reassured if they saw that there was proper scrutiny.

I am really sorry to say that I did not even see a chink of daylight in that group, sadly. I hope that we can move a bit further as the Bill progresses but, in the meantime, with great disappointment, I beg leave to withdraw the amendment.

--- Later in debate ---

[The Deputy Chairman of Committees (Lord McNicol of West Kilbride) (Lab)]

My Lords, the Grand Committee is resumed—third time lucky. I call the noble Lord, Lord Clement-Jones.

[Lord Clement-Jones (LD)]

My Lords, I hope I am demonstrating the agility of which the Minister is so fond. As I said earlier in respect of the judicial commissioner, these amendments provide a ready-made mechanism for oversight concerning the proportionality and appropriateness of any measures in the regulations and codes. Taken together, Amendments 9 and 19, would require the Secretary of State to take into account the advice of the technical advisory board—and insert a new clause after Clause 14—and that of a judicial commissioner appointed under the 2016 Act. We have gone a little further in specifying the make-up of the technical advisory board, but we are clearly on the same page as the noble Baroness, Lady Merron, with her Amendment 8.

Immigration and Social Security Co-ordination (EU Withdrawal) Bill

Debate between Lord Clement-Jones and Lord McNicol of West Kilbride

Committee stage & Committee: 2nd sitting (Hansard) & Committee: 2nd sitting (Hansard): House of Lords
Wednesday 9th September 2020 Lords Chamber

[The Deputy Chairman of Committees (Lord McNicol of West Kilbride) (Lab)]

I have received two requests to speak after the Minister. I first call the noble Lord, Lord Clement-Jones.

[Lord Clement-Jones (LD) [V]]

My Lords, I hope that the noble Lord, Lord Hunt, will not mind if I intervene briefly before he speaks.

I do not think that the Minister can be in any doubt about the powerful concerns that noble Lords have expressed during this debate. First, I thank all those noble Lords who have spoken in the debate on my Amendment 69. Of course, it is part of a pattern across the board in other areas, including universities and the tech industries, which my noble friend Lady Ludford mentioned as well.

I thank the Minister for his response but he is placing an awful lot of weight on the Migration Advisory Committee making an impact assessment in this area. I will read extremely carefully what he has to say but the noble Baroness, Lady Neville-Rolfe, had it right when she expressed doubt over whether that was the right body to be carrying out this kind of assessment: a rather cold, hard, economic assessment that does not take into account many of the other surrounding circumstances involving our creative industries.

The Minister thinks that the amendment, by creating this kind of assessment and report, would replicate what is already there. I beg to differ: this is a separate, and rather different, arrangement, particularly with respect to its consideration of reciprocity. A number of noble Lords were in agreement that reciprocity was extremely important. I thought that the testimonies of the noble Baroness, Lady Bull, and the noble Earl, Lord Clancarty, were particularly important; they spoke from their personal experience. That is not something that the Migration Advisory Committee would deal with.

I will certainly read with interest and care what the Minister has had to say but we may wish to come back to this really important subject—which has gained such support across the House—on Report.

Automatic Enrolment (Earnings Trigger and Qualifying Earnings Band) Order 2020

Debate between Lord Clement-Jones and Lord McNicol of West Kilbride

Monday 23rd March 2020 Grand Committee

[Lord Clement-Jones (LD)]

My Lords, I have always admired the versatility of the Deputy Chief Whip, and today is no exception. I thank him for his introduction. This is a rather important statutory instrument and there are a number of policy issues surrounding it. My heart sank when the Minister said that there is little he will be able tell us, I assume partly because he has no support from officials. I would be very happy for him to write in due course. The other thing he said that made my heart sink was that this is all about technical elements, which, as an understudy, I am not in a position to contest with him in any event.

The real essence of this is what the ABI has raised, because all of us support the scheme but want to see it go further. Both the ABI and the Women’s Budget Group said that we should look at the Wealth in Great Britain 2019 figures produced by the ONS, which show that among 65 to 70 year-olds, median private pension wealth is £164,700 for men and £17,300 for women. That is just over 10% of the private pension wealth of men. There is a considerable imbalance, to which I will return.

The success of auto-enrolment is clear, as the ABI points out, and the number of participating employees continues to increase. However, according to the ABI, if the lower age limit were reduced to 18 and the lower earnings limit removed, people could save another £2.6 billion annually. The change would demonstrate the importance of starting a savings habit early, given the powerful impact that early career contributions can have on the size of retirement savings. It points out that the Government committed to implementing these recommendations by the mid-2020s in the 2017 automatic enrolment review.

Furthermore, extending the coverage of auto-enrolment by reducing the earnings threshold to the NI primary would bring 480,000 people, mostly women, into pension saving, helping improve the gender pensions gap. As I have explained, the ONS figures on that gap are pretty dramatic. All else being equal, this deficit is set to continue, closing by only 3% by 2060. The suggestion of bringing forward that undertaking in the automatic enrolment review seems entirely apposite. I very much hope that the Minister will be able to give that commitment in the letter I know he will have to write after this debate.

[Lord McNicol of West Kilbride (Lab)]

My Lords, I thank the Minister for his introduction and echo the comments of the noble Lord, Lord Clement-Jones. Again, I will raise a number of issues so if the Minister would like to write a letter following this debate I would be more than happy to receive one.

The success of auto-enrolment is testament to the previous Labour Government, with tens of millions of workers saving for a pension under the scheme. In a recent report, the Pensions Regulator found that the overall proportion of eligible staff saving into a workplace pension was 87% in 2018. This has massively increased over recent years and decades. It also found that the largest increase in participation was from the youngest age groups. In the private sector, the largest increase was seen among 22 to 29 year-olds, increasing from 24% in 2012 to 84% in 2018.

We welcome the Government’s continued commitment to auto-enrolment but acknowledge that it is not perfect. Average contributions remain too low and, as the noble Lord, Lord Clement-Jones, said, the threshold too high. Department for Work and Pensions statistics show that, as a result of pensions inequality, 37% of female workers and 28% of black and minority ethnic workers are still not eligible for the scheme.

The exclusion of the self-employed from auto-enrolment also needs to be addressed. Some 15% of the workforce is now self-employed, but the numbers of such workers saving into a personal pension fell by a third between 2014 and 2018. With the current coronavirus crisis, the pressure on the self-employed will only increase, as we are seeing. I know that discussions are taking place around a number of possible changes to the Bill in the other place to try to protect the self-employed.

Today’s statutory instrument keeps the current earnings trigger of £10,000, and that is to remain into 2020-21. However, The People’s Pension found that, by reducing the trigger to £6,240, an additional 1.2 million people would be helped to save for their retirement. Why have the Government decided to keep the trigger at £10,000, given that it excludes some of the most vulnerable from saving into a pension scheme? The Explanatory Memorandum states:

“The Secretary of State decided not to consult on the amounts of the qualifying earnings band and earnings trigger for 2020/21”.


I understand that the Minister will need to write to me, but I ask: why not? Did the Secretary of State not want to take on board the concerns that the unions and others involved in this area were raising?

The Government have said that they will address issues with auto-enrolment, as the noble Lord, Lord Clement-Jones, said, by the mid-2020s, once it has bedded down. We would prefer that to be brought forward, especially given the many issues that will arise out of the current crisis. We see no reason for delay.

It is impossible to ignore the current national crisis of coronavirus. Are the Government looking into support for people who will be affected by a drop in their income over the coming months and years? That drop in income will have an effect on their pension. Are the Government also looking to develop long-term support for the defined benefit schemes, which will be massively affected by the market turmoil?

Justices of the Peace and Authorised Court and Tribunal Staff (Costs) Regulations 2020

Debate between Lord Clement-Jones and Lord McNicol of West Kilbride

Monday 23rd March 2020 Grand Committee

[Lord Clement-Jones (LD)]

My Lords, I thank the noble Lord for again introducing the SI so comprehensively. It just shows how remote lawyers in other fields sometimes are that I did not notice that the justices’ clerk had been abolished; I confess that it was only when I read this SI that I realised that this very long-standing, almost Dickensian pedigree was no longer with us.

Obviously it is extremely desirable that authorised courts or tribunal staff are supported in this way. My only question is about the use of the word “mirroring”, a word that occurs all the way through the Explanatory Notes. Does that mean effectively that the right to costs is identical between the previous justices’ clerks and the current appropriately qualified court or tribunal staff who are authorised to perform certain judicial functions, or has some difference crept in that is either more or less generous?

[Lord McNicol of West Kilbride (Lab)]

I echo the thanks of the noble Lord, Lord Clement-Jones, to the Minister for his detailed introduction. As he said, these are technical rules. I congratulate the noble Lord, Lord Clement Jones, because in reading through the SI over the weekend I was struggling to find a question within it. I welcome the intent to indemnify the authorised officers against any actions that they carry out in good faith.

I have a question about numbers. I noticed that the impact assessment said there was no change from the previous impact assessment carried out in 2018. Does the Minister know how many individuals had to be indemnified and had cases brought against them? Again, if he does not have that information to hand, I am more than happy for him to drop me a note.

Judicial Pensions and Fee-Paid Judges’ Pension Schemes (Contributions) (Amendment) Regulations 2020

Debate between Lord Clement-Jones and Lord McNicol of West Kilbride

Monday 23rd March 2020 Grand Committee

[Lord Clement-Jones (LD)]

My Lords, I thank the noble Lord for his comprehensive introduction. We are all understudies now—I had a crash course on judicial pensions over the weekend. Learning up on O’Brien, McCloud and Miller has not been a happy experience for me or, I suspect, for the Ministry of Justice over a period of years. Being very familiar with higher education pensions, I understand that there are a lot of bear traps in the whole area of pensions and that people feel very strongly about them because they secure their future.

I do not need to pick over the individual details of the instrument—these regulations are very clear and they do the right thing—but this is an opportunity to kick the tyres slightly on the matter of policy. Following the Miller case, the Ministry of Justice is clearly going to have to set aside a certain sum to make sure that the pensions are funded and are non-discriminatory. There have been a lot of estimates, ranging from £300 million to £1 billion, and it would be useful to know whether the noble Lord is possessed of any idea of how much this is going to cost as a consequence of that case.

My second question is about the policy on judicial diversity. The Miller case was all about discrimination, but we are trying to create greater judicial diversity and that goes to the key issue of how pensions operate so that they do not discriminate against people who are part-time or those who enter the scheme late and so on. The July 2019 figures show that just 7% of court judges are BAME and 32% are women. Is it not time that we set clear targets for better gender balance and BAME balance and gave those targets real teeth?

[Lord McNicol of West Kilbride (Lab)]

I echo the thanks to the Minister for his detailed explanation, and I support and share the comments of the noble Lord, Lord Clement-Jones. We understand the need for these regulations to be passed and we will not oppose them.

The noble Lord, Lord Clement-Jones, touched on the Miller case; I am going to consider the McCloud judgment. Can the Minister confirm when the McCloud judgment will be implemented? We understand that it is a complicated matter, but the court passed the judgment years ago and the Ministry needs to work to resolve this long-standing issue.

In the judgment, the judiciary were able to hold that the particular legislation was unlawful because the tribunal found that the provisions were discriminatory on the grounds that younger judges are more often women and members of the BAME community. Although those groups are still underrepresented, it did reflect more heavily on them.

The Government need to address this issue because we have a significant shortage of judges, and especially High Court judges. A number of senior lawyers and members of the judiciary are not applying for those High Court judge jobs, and part of that is because of the changes to the pensions regulations. We are seeing more of an effect there than on other judicial positions. One of the reasons holding people back from applying is that, until there is full clarity, they do not know what the full implications on their pensions will be. I am looking for a little clarity on that.

The Minister also mentioned the consultation. From the Explanatory Memorandum, I was not clear how many individuals or organisations had responded to that consultation. Again, a bit of detail on that would be appreciated.

Parental Bereavement Leave and Pay (Consequential Amendments to Subordinate Legislation) Regulations 2020

Debate between Lord Clement-Jones and Lord McNicol of West Kilbride

Monday 23rd March 2020 Grand Committee

[Lord Clement-Jones (LD)]

I thank the Minister for that introduction. I am not sure whether I am the understudy or the understudy’s understudy, but it has been instructive reading a number of SIs over the weekend and doing my homework. I admit I was shocked to learn that, from government estimates, only two-thirds of businesses provide parental bereavement leave currently, particularly when the last figures I saw, from 2017, were that 7,600 babies and children under 18 died. This is not insignificant. The Minister rightly paid tribute to the noble Lord, Lord Knight, but this also derived from a Private Member’s Bill by Kevin Hollinrake MP and noble Lords should credit him for that.

I very much welcome what the Minister has said and recognise that this is the third of the three statutory instruments needed to put this in place, but I ask the Minister why it has taken two years from passing the original Bill to get this much-needed help. The Minister hoped that this would lead to certain consequences; I hope there will be a communications exercise with business, particularly small businesses, about this duty. I also hope that there will be a full review, not overengineered, of how this is being put in place, after a period—I do not know how long that should be, but maybe a year or shorter—to see whether businesses are really complying. Otherwise, this hard-fought new right, which we very much welcome, will not be worth as much as has been hoped.

[Lord McNicol of West Kilbride (Lab)]

My Lords, I echo and share the comments of the noble Lord, Lord Clement-Jones, especially in thanking both the MP and the noble Lord, Lord Knight, for their work to get this on the statute book. The noble Lord, Lord Clement-Jones, touched on the numbers affected. Before I continue, I declare a non-financial interest as a patron of the children’s charity, Jigsaw4u, which supports the flip of this—children whose parents have died. It is within the same area, so I note that.

This side also supports the intention and wording of this SI. It is good to see legislation or rights being brought in from day one, something we were able to do starting with the Employment Rights Act in the 1990s. Most issues have been touched on, so there is no need to repeat them. This is just to say that we welcome and support both the intention and language of this SI.

Intellectual Property (Copyright and Related Rights) (Amendment) (EU Exit) Regulations 2018

Debate between Lord Clement-Jones and Lord McNicol of West Kilbride

Monday 4th March 2019 Grand Committee

[Lord McNicol of West Kilbride (Lab)]

My Lords, I thank the Minister for his introduction. We broadly accept the position of the department. However, as the noble Baroness, Lady McIntosh, and the noble Lord, Lord Clement-Jones, have touched on, a number of issues are staring at us, both in the impact assessment and in the SI itself. I will not go through all these, because most of the main points have been picked up. However, the Minister touched on the issue of no deal and the problems associated with it. Obviously, if we were to rule out a no-deal scenario, many of the issues would be dealt with and we would not be having these conversations.

Following on from the final point of the noble Lord, Lord Clement-Jones, he will find that the answers are not within the impact assessment, especially on cost and finances. Page 2 of the first two of the three impact assessments, under the heading “Full Economic Assessment”, looks at both the costs and the benefits. In both, the first line states:

“It has not been possible to monetise the costs due to a lack of available data”.


Unfortunately, I do not think there will be detailed answers on the costs, whether to the consumers or to the industry, because of the lack of available data.

That feeds into the Secondary Legislation Scrutiny Committee’s points, which, because the Minister obviously knew they were coming, I am addressing head-on. I do not think there has been a clear enough answer to them. The committee is of the view that it would have been helpful to provide more information on the potential impact of EU exit to UK businesses and consumers in these areas. That is an indictment not of the department, but of the work that has gone into finding out the impact of this.

[Lord Clement-Jones]

Does the noble Lord not agree that, if consultation had been carried out with the right people, we might have discovered what those costs are?