Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Collins of Highbury Excerpts

Committee stage
Tuesday 14th May 2024 Lords Chamber

[Lord Warner (CB)]

My Lords, I intervene briefly, not because I am an expert on international law but because I have a great sense of déjà vu about the way this debate is opening up by comparison with the previous debate. The issue seems to be the creation of uncertainty about what the law means. That was the issue dominating the previous debate: that the trustees of pension schemes would be left in a state of uncertainty if we did not put clearer language in the Bill. This debate is starting to go through the same process but in another area, where there could be uncertainty about what people do in interpreting this legislation before they make their decisions. We are opening up issues that the Government need to attend to, to make sure that the Bill is clear to the people who will be required to implement it.

[Lord Collins of Highbury (Lab)]

My Lords, I put my name to Amendment 32 and I want to focus my main comments on it. The contribution from the noble Lord, Lord Verdirame, is a helpful one because he is focusing on strengthening this.

One of the problems, when we look at paragraph 8 and the implications of international conventions and the ILO, is that it is sometimes difficult to put it into concrete examples. The problem I had—and the noble Baroness, Lady Noakes, touched on this before—is when something goes into a territorial policy. I think of the debate we had on construction in Qatar and the British companies that were operating in building those sites, where the Qatari authorities were forced to have inspections by the ILO and forced to respond to a report that said their legal standards were not adequate. It could be that, at that time, a lot of investors, and perhaps even public authorities, would say that they should not be investing in companies that are adopting those sorts of laws—namely, those applied by the Qataris. Many textiles supply chains go into, for example, Bangladesh. The biggest fashion industry manufacturer is in Vietnam. The example of the Rana Plaza disaster, which we mentioned the last time we debated the Bill in Committee, required ILO intervention and British companies to say, “We will not invest”. Some of the most popular high street companies used strong leverage to get a change of policy by the Bangladesh Government. These are all legitimate concerns.

The fear is that this legislation will stop people making those sorts of decisions, or even expressing those sorts of opinions. It is that chilling effect again. Whoever replies to this debate—I thought it might be the noble Lord—should focus on the kind of concrete examples I have given, and give us an assurance that paragraph 8 includes all the things that my noble friend mentioned and that we will not have a situation where we are limited to very strict criminal things, which everyone accepts, such as slave labour and forced labour. There are lots of other examples. In the Rana Plaza example, people were forced to work in such dangerous conditions that hundreds lost their lives. Many of them were widows, leaving children to cope on their own.

It is important that we bring this debate back to some sort of reality. What are we talking about? What are the impacts of these sorts of things? We start off with a manifesto commitment on BDS, and now we are into the territory of saying that there will be a limit on what public bodies can do to ensure compliance with proper labour standards—things that this Government have been strongly advocating for.

[Lord Roborough (Con)]

My Lords, as I and my noble friend the Minister have set out in responses to previous groups in Committee, the Government take their obligations under international conventions and UN Security Council resolutions very seriously. This Bill is consistent with those obligations. I disagree with the noble Lord, Lord Wallace of Saltaire, that this Government do not take these responsibilities under international law seriously.

Amendment 30, from the noble Baroness, Lady Blower, would exempt from the ban considerations relevant to whether the decision in question would place the UK in breach of its obligations under international conventions, including the genocide convention, the Universal Declaration of Human Rights, and any UN Security Council resolution.

As my noble friend the Minister explained in an earlier group, where a judgment has been made that a party has breached international law, it is for the Government, and not a public authority, to determine the appropriate response. It is right for this Bill not to give public authorities discretion to engage in BDS campaigns based on their own interpretations of international law. I am grateful to the noble Lord, Lord Verdirame, on this point.

I will touch on the genocide convention in particular; I am grateful for the intervention of my noble friend Lady Noakes. Genocide is a crime and, like other crimes, whether it has occurred should be decided by competent courts and judges, after consideration of all the evidence available, in the context of a credible judicial process. It is the long-standing policy of successive UK Governments that judgment as to whether genocide has occurred is for a competent national or international court to determine, not public authorities.

I reassure the Committee that nothing in the Bill will prevent public authorities complying with the UK’s obligations under international conventions. It is not necessary to broaden the international law exemption in this way, and so I respectfully request that the noble Lord, Lord Hendy, withdraw the amendment of the noble Baroness, Lady Blower.

Amendment 32, tabled by the noble Lord, Lord Hendy, would broaden the existing exception for considerations that relate to labour-related misconduct. I assure noble Lords that the Government are of the view that employers who seriously violate the rights of their workforce are not fit to compete for public contracts. That is why the Bill already contains an exception to the ban for considerations made as part of an investment or procurement decision that relates to labour-related misconduct. This exception mirrors the approach taken in the Procurement Act 2023, which this House agreed in the previous Session. Public authorities can use the exception in the Bill when assessing whether a particular supplier has been complicit in modern slavery or a contract risks involving modern slavery. They must do so on a supplier-by-supplier basis, rather than by taking a blanket approach on the basis of a supplier’s country of origin. Public authorities will be able to do the same for investment decisions, assessing modern slavery risks for each investment target, rather than taking a blanket country-based approach.

Additionally, the Procurement Act 2023 provides a range of serious labour violations as grounds for exclusion. These must be considered for every supplier wishing to participate in each procurement within scope of the Act. The Act expanded the scope of the grounds on which suppliers must or may be excluded from procurements for labour violations, and added new grounds, including failure to pay the national minimum wage and offences relating to employment agencies. To reiterate, this is mirrored in this Bill. The exceptions to the Bill, just like the exclusion grounds in the Procurement Act, include considerations relating to various labour market, slavery and human trafficking offences. These are based on the serious labour offences within the purview of the director of labour market enforcement.

It would not make sense to expand the exception to the ban beyond what has already been recently agreed by the House in the Procurement Act. This would put the Bill out of step with that Act and create confusion for public authorities in scope of both this Bill and the Procurement Act.

The grounds for excluding suppliers in the Procurement Act are framed in terms of UK labour offences in our domestic legislation—and are, therefore, binding—rather than by reference to International Labour Organization conventions, to provide greater clarity to contracting authorities regarding when the grounds apply. I believe that this confirms the point from my noble friend Lady Noakes.