Procurement Bill [HL]

Debate between Lord Fox and Baroness McIntosh of Pickering

Committee stage
Monday 4th July 2022 Grand Committee

[Baroness McIntosh of Pickering (Con)]

I am delighted to follow my noble friend with a few brief remarks. I say at the outset that I regret that I was unable to contribute to Second Reading. I shall limit my remarks today to my arguments probing why Clause 2 and Schedule 2 are part of the Bill. This raises a more general question as to why we actually need the Bill, as I understand that we are already in the GPA. We have had a number of Statements about this and discussions in this regard with the Minister responsible for trade, my noble friend Lord Grimstone. I would be grateful if my noble friend could elaborate on what I am about to put to him.

As I understand it, the purpose of the Bill is twofold: first, to reform the UK’s public procurement regime following our exit from the EU; and, secondly, to create a simpler, more transparent system that better meets the country’s needs rather than being based on transposed EU directives. I understand that we are to have a separate exercise where we go through all the retained EU law, when we come to what is euphemistically known as the Brexit freedoms Bill, to decide which of those retained EU directives we may wish to keep.

My understanding is that much of what is before us today, as my noble friend has explained, is already covered by the World Trade Organization Agreement on Government Procurement—the GPA, as it is called. The aim of that agreement is to mutually open government procurement markets to those party to that agreement. The threshold values are, curiously, almost identical to the thresholds that had to be met through our membership of the European Union, which was roughly €136,000. We are now looking at £138,760 as the threshold for the general agreements for goods; for services, it is the same amount and, for construction, it is £5 million-plus.

As my noble friend Lord Lansley rightly assumed, I am trying to ascertain through this debate the way in which public contracts can be defined. I am assisted in this regard by paragraph 16 of the Explanatory Notes, which sets out that:

“The Public Contracts Regulations 2015 will be repealed and new rules on procurement will be set out in the new regime. Most central government departments, their arms-length bodies and the wider public sector including local government, health authorities and schools will have to follow the procedures set out in the Bill in awarding a contract with a value above set thresholds to suppliers.”


If, for example, there is a public procurement contract for food, for vegetables and meat, for a local school, hospital, prison or some other public body, what is the procedure that will have to be followed after the adoption of the Bill and, more specifically, the regulations that will flow from it?

That is the specific question that I would like my noble friend the Minister to address. How will public procurement for contracts over the threshold be treated? For the purposes of the Act, will they be treated differently from those that already apply under the GPA? How will the contracts apply for those that are under the magic threshold of £138,760? In effect, will the same procedures apply as before we left the European Union? I am particularly interested in food, fruit and vegetables, for the reason that we were all told this was going to be a benefit—a Brexit dividend from leaving the European Union—but I am struggling to see how this dividend will be delivered in this regard. When these contracts are put out for tender, whether they are above or below the threshold, how will that procedure apply? Can those that are under the stated threshold be awarded to local suppliers without being put out for international tender, or could we have Spanish or, indeed, African companies applying to deliver these?

I admit to being confused, because we were told that this was something that would happen after we left the European Union, and I am still struggling to see how these contracts are going to happen. We were told that it would boost local growers in this country to have these contracts put out for tender once we were no longer in the European Union. I look forward, with great anticipation, to my noble friend the Minister’s reply.

[Lord Fox (LD)]

My Lords, up to her final couple of sentences, I was going to recommend that the Minister listen very closely to the advice from the noble Baroness, Lady Noakes. This group of amendments essentially carries on the theme of what is in and what is out, which is the existential theme of almost everything we are debating that is not a government amendment. In that respect again, it is a welcome set of amendments and I think, all joking aside, that the noble Baroness’s points are really important points for the Minister to clear up. I do not understand where we are on this and if the noble Baroness, Lady Noakes, does not then it probably is not understandable.

Professional Qualifications Bill [HL]

Debate between Lord Fox and Baroness McIntosh of Pickering

Committee stage
Tuesday 22nd June 2021 Lords Chamber

[Baroness McIntosh of Pickering (Con)]

I support my noble friend Lady Noakes in her two amendments and the noble Baroness, Lady Hayter, in her Amendments 63 and 68. The first list that I saw was the one produced informally by my noble friend Lady Noakes, which I was delighted to see and took as gospel. Now we have had two or three iterations of it. While that may cause us some confusion and bemusement, one has to look to the professions and the regulators that are required to regulate them. I start from a simple premise: I am a non-practising member of the Faculty of Advocates. I understand what the faculty does, along with the corresponding regulator in England and the Law Society of Scotland—that is, the regulators for their respective professions.

I am delighted that the noble Lord, Lord Purvis, has leapt to the cause that I supported on the question of why pig farmers were chosen for special treatment under the Bill. If I may pause on the completeness of the list, I am not even sure that all the professions listed on pages 20 and 21 of the impact assessment—which I know the noble Lord, Lord Purvis, thinks is no longer entirely up to date—are covered in the new list. It is difficult to see whether

“Chief engineer class I fishing vessel”

and

“Deck officer class II fishing vessel”

have simply been renamed in the list that we received on Sunday afternoon or whether they are the same in the impact assessment and the latest letter. What causes me some concern and confusion, in the light of the comments by the noble Lord, Lord Purvis, is the foot- note to table 4 on page 20 of the impact assessment:

“European Commissions’ Regulated Professions Database. It should be noted that recognition decisions are captured at the generic profession level and not the specific profession level. Some generic professions listed may therefore include specific professions which do have alternate routes and/or which may be likely to be included in the new framework. This table is therefore likely to overstate the recognition decision numbers of the specific professions without alternate routes and which are not likely to be included in the new framework.”


Now I am even more confused than before.

In the light of the forensic work that the noble Lord, Lord Purvis has done in this regard, I am still not entirely convinced as to why pig farmers are included, and producers of chickens for meat production only are included. Does that mean that overseeing egg-producing chickens is not deemed to be a profession and is therefore not regulated for the purposes of the Bill? I go back to what I said when this issue was first raised on the second day of Committee: could my noble friend please state the legal basis for including pig farmers? Has it been correctly identified by the noble Lord, Lord Purvis? I would like to understand, when I meet them at Thirsk auction mart, whether they are included or not. Are egg-producing chickens included or only those for meat production? Perhaps more importantly, on what basis are beef and lamb producers and producers of chickens for other purposes not included? Is that a permanent exclusion or could it be revisited, and might they be included at a later date?

The noble and learned Lord, Lord Hope of Craighead, was being very restrained when he said that this is an unsatisfactory situation. We have to accept that the Bill before us is perhaps not fit for purpose and that we need to do other work on it. I do not think that, hand on heart, we can allow it to go forward to Report and eventually leave the House in this form, because we would not be serving well the professions or indeed their regulators if we did. So I support Amendments 45, 46, 63 and 68 and particularly the call from my noble friend Lady Noakes to pause the legislation at this stage so that we can do the work that, undoubtedly, my noble friend and his department would be delighted to do.

[Lord Fox (LD)]

My Lords, this has been an interesting debate. Before talking about the amendments specifically, I want to respond to the noble Lord, Lord Moynihan. I support his point, but the ski instructors of Great Britain are not alone in having their route to working in the EU cut off. We should look at the overall economic impact of this. Research by Make UK, which represents the UK’s manufacturing industry, shows that 61% of manufacturers regularly send their employees to the EU to follow up their manufacturing work with service work. Almost all of those have qualifications that until now have been recognised in the EU, but that is no longer the case. So this is a huge economic issue, not just for ski instructors and their families but for the entire manufacturing and indeed service sector of this country. The noble Lord has hit on a point, but it is actually a much bigger point overall.

--- Later in debate ---

[Baroness McIntosh of Pickering (Con)]

My Lords, first, it was churlish of me not to thank my noble friend the Minister for his enthusiastic embracing of the idea of a round table in connection with Clause 9; for that I am extremely grateful to him. I am also grateful that he asked us again to refer to the Explanatory Memorandum in relation to Clause 13, in addition to the remarks made by the noble Lord, Lord Hunt, in moving this amendment. The EM states that the powers under Clause 13

“may be used to modify legislation, including, where relevant, Acts of Parliament.”

Again, an Act of Parliament is being amended not by another Act, but simply by regulation.

Every Government like to govern by regulation and every Opposition would prefer things to be on the face of the Bill—that is just a fact of life to which I am becoming accustomed, having only served as a shadow Minister, not the real thing. But I would like to take this opportunity to ask my noble friend the Minister one specific question. Clause 13 as drafted is silent on any requirement to consult on these regulations. What consultation will there be, and at what stage might draft regulations be passed to the regulators as well as the relevant devolved Administrations? It is extremely important that they see them at the earliest possible stage.

Could my noble friend also put my mind at rest regarding an issue that the noble Lord, Lord Hunt, referred to in connection with Clause 9: the potential conflict between regulators of a devolved nation and regulators in another devolved nation or, indeed, the “mothership”—the English regulator? Might that situation arise under Clause 13? How would my noble friend aim to prevent that arising?

[Lord Fox (LD)]

I am grateful for the speeches we have heard so far. I am a cosignatory to this amendment and I would like to associate myself completely with the comments of the noble Lords, Lord Hunt and Lord Patel. However, if they will excuse me, I would like to single out the comments of the noble and learned Lord, Lord Thomas of Cwmgiedd, which were a clear, clarion call as to what we need to do with this clause: take it out. If we do not, we will let a Bill leave your Lordships’ House with so much power vested in the Minister and the department.

We are still struggling with what this Bill is for. If, as the Minister says, the first four clauses are its beating heart, then if things change, these issues can be picked up in primary legislation. Secretary of State Fox was very clear: trade deals will be brought to Parliament and debated as primary legislation. If and when the Government renege on that, perhaps it would be a problem of their own creating, but to leave this Henry VIII clause in the Bill is to pass too much untrammelled power going forward. I am sure that every department wants that ability not to have to worry about what Parliament says when it is making regulations and primary legislation, but your Lordships are here to stand up against things like that. We should remember the words of the noble and learned Lord, Lord Thomas, as we move forward to Report.

Professional Qualifications Bill [HL]

Debate between Lord Fox and Baroness McIntosh of Pickering

Committee stage
Monday 14th June 2021 Lords Chamber

[Baroness McIntosh of Pickering (Con)]

I have two brief points. I would like to speak in support of Clause 4 standing part of the Bill, but I welcome my noble friend explaining, in response to earlier amendments, that this will be regulator-led and is permissive, not prescriptive.

First, I am slightly concerned by subsection (1), as explained in paragraph 39 of the Explanatory Notes, which then go on to say that it seems quite prescriptive. I do not know if that takes away from the permissive nature of the rest of the clause.

Secondly—and, to be honest with my noble friend and the Committee, I could not think of where else to raise this—I accept that they are not regulated bodies, but I understand that the professional drivers and attendants of pig farmers, chicken producers and livestock transporters are covered by the remit of the Bill. It is interesting to see, but I cannot understand why beef and lamb producers are not covered, because it strikes me that they might like the opportunity to make common ground with countries with which we are seeking to do deals. It may be that they are allowed to do so, but if they are, I wonder why they are excluded from the remit of the Bill.

Finally, I assume that the costs will be minor. I would like to place on record the fact that most of the bodies that have contacted me welcome the powers set out in Clause 4. I do not know whether paragraph 66 on page 18 of the impact assessment is relevant here. That refers to frameworks but I presume that also covers regulator recognition agreements. It comes up with a figure, giving a mean of £350,000 as a best estimate. On what basis has that figure been reached?

[Lord Fox (LD)]

My Lords, we are indebted to the noble Lord, Lord Hunt, for opposing that this clause stand part. The way in which he set out the issues around delegated powers was excellent. I have nothing to add, but I would like to associate myself with what he said. His point about the severity of the sanction of a DPRRC report is very well made. I have tried to make in different ways. I think we will all be waiting to see how the Government react in legislative terms.

The term “encouragement” has come up and, clearly, Clause 4 is the encouraging end of a continuum that goes through “recommendation” and ends up in “compulsion”. Here, I come back to the question that my noble friend Lord Purvis asked when we were debating Amendment 30. The Minister confirmed that Clause 4 is voluntary, which we were all grateful for, but omitted to respond to my noble friend’s question about whether Clause 3 has the power to override Clause 4 and move that encouragement further down the continuum towards compulsion. Rather than ask it that way around, let us ask it the other way around. Are there any circumstances in which Clause 3 can be used? In other words, would the Minister rule out that Clause 3 can ever be used to compel regulators to do things as a result of Clause 4?

Professional Qualifications Bill [HL]

Debate between Lord Fox and Baroness McIntosh of Pickering

Committee stage
Wednesday 9th June 2021 Lords Chamber

[Baroness McIntosh of Pickering (Con)]

I am delighted to support many of the amendments in this group. Those in the name of the noble Lord, Lord Foulkes, are very similar to those in my name. I notice that Amendment 38 extends the proposed consultation to Clause 6. I will limit my remarks to the amendments in the name of the noble Baroness, Lady Hayter, and Amendment 52 in the name of the noble Lord, Lord Palmer of Childs Hill.

The noble Baroness, Lady Hayter, has cleverly married the concept of consultation with specifying the number of bodies that are to be consulted upon. When she comes to move Amendment 27, I would be interested to learn why she picked those specific ones. I am also interested to learn from the Minister why there is no reference in the Bill to any specific professional bodies. What was the thinking behind that?

On Amendment 52 in the name of the noble Lord, Lord Palmer of Childs Hill, obviously, a number of professional people co-operate together in partnership, but many may consider them a small firm, if you like. I see some merit to Amendment 52 in relation to what the Bill’s impact will be on small and medium-sized companies. I look forward to hearing my noble friend’s response to that request.

[Lord Fox (LD)]

My Lords, this group is perhaps the inevitable consequence of trying to reduce a highly complex system and situation, as the Minister has highlighted, into a small one-size-fits-all Bill. In other words, we have a mixed bag of amendments in this group. I will speak initially to Amendments 53 and 54 in my name and to Amendment 52 in the name of my noble friend Lord Palmer of Childs Hill.

I thank the noble Lord, Lord Patel, for his support of Amendment 53. He said that he was disappointed to be speaking before me. I have to say that I am not disappointed to be speaking after him because he gave a much better speech than I could possibly have managed myself. The noble Lord, Lord Lansley, is right, in that the innovation issue is hard to measure, but I think that the point made by the noble Lord, Lord Patel, that this is part of a cumulative effect on innovation is important.

I was hoping to probe the Minister on how the Government have joined the dots between the intention of the Bill and how it will drive the future nature of our economy. To some extent, the criticism of the noble Baroness, Lady Noakes, of these kinds of amendments as a way of trying to shoehorn in something else is true; I make no apology for that.

At the heart of the Bill, there is a central conceit. 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.”—[Official Report, 25/5/21; col. 908.]


What is a “shortage of professionals”, and what level of omniscience is required from the department in order to identify that particular need in the market for professionals?

Is there a danger that the Bill is in fact solving yesterday’s problems? That is the innovation question—because we need people to create the businesses of the future. Yet we have a Home Office that lets in only people who already have a job, and BEIS, which will measure the current need for people. The noble Lord, Lord Patel, was closer to the mark when he talked about early career researchers—I would add research technicians. Both find it extremely difficult to get Home Office visas because they are paid less than the limit for them to come in.

We are going to have a debate about the availability of people, in the group starting with Amendment 17, and I do not want to pre-empt that, but I want to hear the Minister’s playback on how the department and those drawing up the Bill drew the dots between the Bill and innovation. That is one of my objectives with this amendment.

Amendment 54 looks at a different kind of impact. In fact, in retrospect it should have been grouped with the amendment of the noble Baroness, Lady Noakes, Amendment 9, because in a sense it measures the effect that she has highlighted there. As happenstance will have it, she did not get an answer to her questions the first time around, so this gives us a chance to run through them again.

Minister, there is a strong belief that the regulators will come under great influence from the Government on the level of fees. That will either reduce their income or maintain their income at the expense of those registering. This amendment seeks to give transparency to that problem. If indeed it is not a problem, we will see that clearly. The noble Lord, Lord Lansley, gave it something of a thumbs-up, in that it is measurable—and I assume that it is data that BEIS is already collecting because, of course, it is going to create a model of the entire professional market in order to manage it on behalf of the national economy. I assume that the data is already available. Therefore, publishing it would be very helpful and perhaps give a lie to the fears or expose them, so that the Government can change things to stop them becoming an issue.

Very simply, the point from the noble Baroness, Lady Bennett, about some joined-up reporting is well made. Whether it is the whole hog or just a few key elements—and I would probably prefer the latter to the former—I think that the global south issue can be solved by having a geographic split on where people are coming from, for example, to highlight those issues.

My noble friend Lord Palmer spoke on Amendment 52 about the need for there to be a realisation within organisations of the impact of the Bill, particularly on SMEs. In the past, many SMEs have picked up employees from the European Union without having to give a moment’s thought to the accreditation of their skills. That is now changing, and I absolutely agree with my noble friend that there has been no dawning on the vast majority of Britain’s businesses of that change. I think he has a great point.

The noble Lord, Lord Foulkes, spoke strongly, as usual. I agree with him—I would like the opportunity to intervene and interrupt the noble Lord, although of course I would exercise it with great care. But in the main, I would like the Minister to push back on Amendments 53 and 54 and say how this affects innovation and whether we can see the numbers when it comes to costs and the financial effect on the regulators.

National Security and Investment Bill

Debate between Lord Fox and Baroness McIntosh of Pickering

Report stage
Thursday 15th April 2021 Lords Chamber

[Baroness McIntosh of Pickering (Con)]

My Lords, I am delighted to speak on Report. I congratulate my noble friend Lord Leigh on raising this persistently and so eloquently at earlier stages of the Bill. I congratulate my noble friend the Minister on listening to and acting on the concerns expressed across the House at that stage by bringing forward the amendments that he has today.

I particularly associate myself with Amendment 8, to Clause 8, in the name of my noble friend Lord Hodgson of Astley Abbotts. I would like to press the case a little further with my noble friend the Minister and ask that we pause for a moment at this stage and ensure that we are not going to scare off potential large investors with an increase in referrals that perhaps could not be managed or see a deterrence to potential investment, therefore possibly damaging the economy.

The way in which I would like to press my noble friend the Minister follows on from what my noble friend Lady Neville-Rolfe said in her opening remarks just now as to what extraneous factors may be taken into account that could damage potential investment in this country. Those further factors that I ask my noble friend to rule out have been put forward at earlier stages by the Law Society of England, which I supported in Committee and repeat in connection with Amendment 8 here.

Can my noble friend clarify and give greater certainty as to what constitutes national security? Will he specifically rule out extraneous factors such as employment effects, reciprocal investment and trading opportunities in other jurisdictions and a desire to protect UK business from international competition as factors that would be taken into account when assessing whether a trigger event would give rise to a national security risk? In terms of Amendment 8 and our earlier discussions, it would give clear guidance to those practitioners at this stage if we could rule out that those extraneous factors would ever constitute a potential national security risk.

[Lord Fox (LD)]

My Lords, we have had a short and interesting debate. Speaking to Amendment 2, the noble Lord, Lord Lansley, has as ever uncovered an incongruity in the way the Bill is drafted. I suggest the Government are wise to listen to his advice. Similarly with Amendment 8, there is a need for clarity for people. Where do they stand on this issue? That is all people deserve when trying to manage their affairs.

We then come to the extraordinary intervention of the noble Baroness, Lady Neville-Rolfe. It is a shame that she was not around to give a Second Reading speech, which perhaps might have guided us through some of our decision-making, and arrived only at this late hour to offer her help. I suspect that, had she involved herself a little earlier, she might have been less concerned with the issues than she is now. For fear of doing the Minister’s work for him, I ask him to confirm that the regime retains the right to call in deals that are less than 25% at any time. The notion that there are deals that the regime may not see is one of the points inferred by the noble Baroness, Lady Neville-Rolfe.

This is the point: the unit has to be sufficiently resourced and efficient in its work to be able to pick these issues up. We shall talk later about where it gets its information and how the security guidance is fed in, because that comes under another group of amendments. However, with all the issues coming through, the point is how well the regime is actually operated; the noble Baroness, Lady Noakes, has mentioned this on many occasions. That will be the rub, in terms of how business will be affected by the Bill. The more the Minister can reassure us that the resources will be there to deliver this, the happier most of us will be.

National Security and Investment Bill

Debate between Lord Fox and Baroness McIntosh of Pickering

Committee stage & Lords Hansard
Tuesday 2nd March 2021 Grand Committee

[Baroness McIntosh of Pickering (Con)]

My Lords, in the spirit first put forward by my noble friend Lord Vaizey, I would like to tease the Minister at this point, if I may. Clause 3 states:

“The Secretary of State may publish a statement for the purposes of this section if the requirements set out in section 4(1) are satisfied”,


and now we have government Amendment 12, which amends Clause 4 to state that responses to the consultation may be required to be pursued through. What is the situation, if one might occur, if the Secretary of State chose not to publish a statement? Does the Bill permit that in this regard, and what would be the circumstances in which the Secretary of State may decide not to publish a statement?

[Lord Fox (LD)]

My Lords, as the noble Lord, Lord Lansley, said, government Amendments 37 and 75 are technical and Amendment 12 covers the ground of Amendment 11, so I will speak to the latter. I am broadly supportive. Clearly, this is an issue about “may”—my noble friend Lady Bowles and the noble Baroness, Lady McIntosh, asked the same question. If “may publish” means “may not publish”, where are we in this process, given that the statement is such an important part of setting out the modus operandi of the whole Bill? This is quite an important area.

I support Amendment 11 but it will be important to listen to the Minister’s response to decide how this might go forward in the next stage. I believe that some degree of accountability should not be left as an option to the Secretary of State; there should be an obligation on the Secretary of State to make that statement and, as the Government have said, to have the ability to remake it.

--- Later in debate ---

[Baroness McIntosh of Pickering (Con)]

My Lords, Amendment 14 in my name came about as a result of my working closely with the Law Society of Scotland. I am very grateful to the society for drawing to my attention the fact that, on the present reading of Clause 6, the Secretary of State may make regulations without any further consultation in that regard. The reason for the amendment is that this consultation provides an additional layer of scrutiny by all interested parties. The requirement on the Secretary of State to consult will help to ensure openness and transparency of the Secretary of State’s actions. Imposing a duty to consult will ensure that any draft statutory instrument is exposed to critical comment from stakeholders, which may improve an instrument and help to avoid difficulties when it comes to progressing through Parliament.

All this assumes that the Government will actually pay attention to consultation and the results. It is felt that the provision as drafted gives the Secretary of State very wide discretion to amend the scope of notifiable acquisitions as per the present drafting of Clause 6(5). This can have far-reaching consequences, not least because, as set out in Clause 6(6), it may be used to extend the scope of notifiable acquisitions to acquisitions of qualifying assets. In particular, I want to put on record that Clause 13 states that where a notifiable acquisition takes place without the approval of the Secretary of State, this transaction will be void, although under Clause 15(2) and (3) the defect can be cured retrospectively.

This amendment addresses a concern that there will be a lacuna in relation to the impact on third parties. In particular, if the qualifying asset in question is land, and if it were to be established that a transaction had been void and that the ownership or other interest in the land had not been properly transferred, questions of liability may arise. This could be the case, for example, in relation to environmental or insurance liabilities. Although it appears that the third party would have an action under Clause 16, we are concerned that this could be both burdensome—that is the Law Society expressing its concern—upon that third party and unnecessarily complicated. There is also concern that it might not resolve all the relevant problems.

I welcome my noble friend to her speaking position, for once, this evening; I hope that this is not just paying lip service to diversity. If the Government are not minded to accept this amendment, can she say what the purpose is of introducing regulations at what would be quite a late stage and without having consulted at all with interested parties or stakeholders?

[Lord Fox (LD)]

My Lords, I fear I might have missed a trick here. I think we have two quite different amendments and I should have been smarter and disaggregated Amendment 94 from Amendment 14. I apologise to the noble Baroness, Lady McIntosh, that I am not going to speak to Amendment 14, although I firmly believe that my noble friend Lord Bruce of Bennachie will speak to it later. I will speak to Amendment 94 in my name and that of my noble friend Lord Clement-Jones.

Under Clause 6 the Secretary of State has great power to make the regulations concerning how this Bill will work. The Secretary of State can specify the description of the qualifying entity for the purpose of identifying a notable acquisition. He or she can amend the circumstances in which a notifiable acquisition takes place or does not take place, exempt acquirers with specified characteristics from the mandatory notification regime and make consequential amendments to other provisions of the Bill. These will be set before Parliament using the affirmative procedure. This was confirmed by one of the other documents that was circulated just before our proceedings began today.

For the commencement of the regime, the Secretary of State intends to make regulations only to specify the sectors subject to mandatory notification—that is, the 17 sectors we have already referred to elsewhere in this debate. This covers the activities of the entities of both sectors which give rise to an elevated national security risk. In the Government’s own words:

“Mandatory notification of certain types of transactions in 17 key sectors will ensure that the Government is informed of potential acquisitions of control or ownership in these particularly sensitive areas”.


As we have heard, using this list they will take action to investigate and mitigate any national security risk. The list is central to the workings of this regime. Therefore, so is the making and updating of it.

For the avoidance of doubt, and possibly to bore the Committee, I want to put on record the length and breadth of this list. It includes advanced materials, advanced robotics, artificial intelligence, civil nuclear, communications, computing hardware, critical suppliers to government, critical suppliers to the emergency services, cryptographic authentication, data infrastructure, defence, energy, engineering biology—which has now been commuted to synthetic biology—military and dual use, quantum technologies, satellite and space technologies, and transport. We heard from the Minister that in fact the Secretary of State can extend beyond this list if he or she feels it appropriate.

The so-called slimline version was published today, as mentioned by the noble Baroness, Lady Hayter, who has just popped out. She referred to the artificial intelligence sector which has been “slimmed down” to the identification of objects, people and events, advanced robotics and cybersecurity. The underlying software for that is going to be machine learning, and therefore that includes all artificial intelligence. While on the face of it this has been narrowed down, the reality is that if a Secretary of State so chose, anything involving machine learning could be dragged into this process. We need to be very wary of this list, which can be expanded and changed over time.

I expect that the Minister will choose to represent the proposed use of the affirmative procedure in the Bill as meaningful parliamentary scrutiny, but in truth the list can be amended by this and any subsequent Government as they please. For one thing, Parliament cannot amend statutory instruments, and for another, this House has voted down affirmative statutory instruments just four times in the past 70 years. That is nearly as long as my noble friend Lord Clement-Jones has been alive. As the Constitution Committee noted in its 2018 report The Legislative Process: The Delegation of Powers:

“Without a genuine risk of defeat, and no amendment possible, Parliament is doing little more than rubber-stamping the Government’s secondary legislation. This is constitutionally unacceptable”.


Affirmative statutory instruments do not constitute meaningful parliamentary scrutiny. This Government, or any subsequent Government, are effectively free to amend that already long list of technologies at will, so we need some sort of genuine democratic process. I am indebted to my noble friend Lord Sharkey; he proposed a very similar amendment to the Medicines and Medical Devices Bill, and I have ruthlessly plundered his thinking as it is just as apposite to this Bill.

As noble Lords know, there is a delegated legislation procedure that allows for significant parliamentary scrutiny. To the Government, it is known as “exceptional procedures”, and to Erskine May, in part 4, chapter 31.14 as the “super-affirmative procedure”. Erskine May characterises it as follows:

“The super-affirmative procedure provides both Houses with opportunities to comment on proposals for secondary legislation and to recommend amendments before orders for affirmative approval are brought forward in their final form … the power to amend the proposed instrument remains with the Minister: the two Houses and their committees can only recommend changes, not make them.”


Amendment 94, in my name and that of my noble friend Lord Clement-Jones, follows this pattern; it is more generally based on the variant of the procedure used by the Government of the day in the Public Bodies Act 2011, so it is not a stranger to government. It refers to the Secretary of State’s regulation-making powers and includes the long list of technologies that I have just read out.

First, the Secretary of State must lay before Parliament a draft of the proposed regulations and a document explaining them; secondly, he or she must request a committee of either House whose remit includes science and technology and business to report on the draft regulations within 30 days; thirdly, in proposing a draft statutory instrument containing the regulations, the Secretary of State must take into account any representations, any resolution of either House and any recommendations of the committee to which the draft was referred. After the expiry of the 30-day period the Secretary of State may lay before Parliament regulations in terms of the original or the revised draft. The Secretary of State must also state what representations, recommendations or resolutions were given in the 30-day period and give details. He or she must also explain any changes made in a revised draft. After that, the normal affirmative process continues.

--- Later in debate ---

[Lord Fox (LD)]

I anticipated the Minister’s answer on the subject of time, and 30 days is 30 days, but the Government have shown that they are relatively adept. If there really was a national security emergency requiring quick action using other means, a statutory instrument with a debate in Parliament would act as a plug. My noble friend Lord Clement-Jones made the point that there is such significance, particularly around this list but also around the other elements of Clause 6, so I hope that the Minister will read Hansard and at least find some way of moving towards the very valid arguments that she has heard today on both amendments.

[Baroness McIntosh of Pickering (Con)]

I thank all those who have spoken on both amendments. The noble Lord, Lord Fox, will recall that we had a lengthy debate about the super-affirmative procedure during the passage of the UK Internal Market Act. I deeply regret that we did not go down the path of that procedure, for reasons that I gave. My noble friend the Minister cares passionately about Wales, and I hope that she will care equally passionately about Scotland and will be prepared to meet with me to bring these matters forward, because I do not accept that it is enough just to have regard to the public law requirements.

The Law Society of Scotland has identified three ways in which these regulations could move the parameters forward which I would like to discuss on a wider basis with her. While an official in the department said that it is not expected at this stage that those three areas will be covered, it is not excluded that that will happen in the future. I want to come back to that, but for the moment, I beg leave to withdraw the amendment.

Trade Bill

Debate between Lord Fox and Baroness McIntosh of Pickering

3rd reading & 3rd reading (Hansard) & 3rd reading (Hansard): House of Lords
Monday 18th January 2021 Lords Chamber

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

My Lords, I welcome this group of amendments. I pay tribute to my noble friend and his colleagues, who have successfully engaged the legislative consent from the Scottish Parliament. I say that as someone of Scottish descent, and a non-practising member of the Faculty of Advocates.

I honestly do not believe that we would have got to this pass if it had not been for the intervention of a number of noble Lords, but especially the noble and learned Lord, Lord Hope of Craighead, among others, who intervened at all stages of what is now the United Kingdom Internal Market Act. I hope my noble friend will join me in paying tribute to the ongoing discussions on the framework agreements between the four nations that will be increasingly important as we develop trade, agriculture and environmental policy. But I am sure that there was more than a minor hiccup in engaging with the Scottish Parliament, so I congratulate him and I welcome these amendments in bringing us to that pass. Although he describes them as technical and not significant, I think they are a major step along the path to securing the passing of the Bill as it proceeds to the Commons.

[Lord Fox (LD) [V]]

Following two previous attempts spread over years, the Trade Bill seems finally to be making its way towards the statute book, perhaps by way of ping-pong. These amendments were described by the Minister as essentially technical housekeeping. I agree with him and certainly with the amendments, but perhaps it is appropriate that the final amendments we will discuss focus on inserting the Bill into the devolution settlement, as symbolised by the Scotland Act.

As the noble Baroness, Lady McIntosh, said, the Trade Bill is about setting Westminster’s role for the future, just as the internal market Bill did. I am pleased to hear about the legislative consent from Scotland and Wales, but in the past months these Benches have shown that we disagree with the way the Bill has avoided the effective involvement of Parliaments and Assemblies in the United Kingdom, taking a lot of power for the Executive.

But we have had those debates, and I will use this time to focus on some elements of the application the Trade Bill might enjoy. It is worth pointing out that the UK will be embarking on this so-called independent trade policy when the global trading environment is—how should I put it?—challenging. Even before the massive uncertainty of the global pandemic there were increasing trade tensions and a slowdown in the global economy.

Yet when I listen to the words coming from government mouths, I often hear echoes of British exceptionalism. Phrases such as “sovereign island nation”, when trotted out, seem to hark back to the 19th century. It is this backward view of the world that most disturbs me. I hear overtones that reflect the use of trade deals in a way that European nations did to compete for imperial domination in the 1800s.

At the heart of this is a total lack of understanding of the nature of modern global supply chains. Despite ministerial remonstrations when debating the Bill, it is impossible for me not to take the recent deals as examples of trade policy and how they are being applied. Of course, we could look at the rollover deals, but none of these has delivered anything material that we did not have before, so there is not much material there.

Then we come to the EU and UK deal. Clearly, there are substantial changes here that point to the direction we are travelling in. It is hard. It demonstrates this lack of understanding of how the flow of goods and services is facilitated by supply chains. Such flows are no longer maintained by access to the clipper ships of the East India Company, as this nostalgia seems to reflect, but nurtured by standards, people and data—three areas the EU trade agreement fails to enhance.

The role of shared standards and regulations is becoming only too apparent to our exporters struggling with serious border friction. Meanwhile, the lubricating effect to trade of mobility frameworks and mutual recognition of skills has yet to impinge on the wider public. However, I believe the tone of the Government’s responses to amendments addressing these issues will ultimately be seen as foolish. Finally, there has been no progress on data flows. That problem has just started.

Christmas Eve was not the end of this story; it was one step in a long process of negotiation. There will be protracted and difficult discussions about implementing the provisions covering trade in goods. We are starting to see this. Then there are two key areas outstanding. The first is financial services. Talks on an equivalence deal are taking place over the next three months, but this will exclude core banking services such as lending, payments and deposit-taking. If the EU and the UK fail to secure agreement, the UK will be left with the task of negotiating separately with 27 member states.

Then, as I said, there is data adequacy. The EU Parliament has severe reservations regarding sharing data with the UK. There is great suspicion over the potential onward transfer of data to the USA. Overcoming these fears will require much more than the Prime Minister looking into the eyes of MEPs and saying, “Trust me”.

However these go, the EU and the UK will remain in low-level dispute on all sorts of issues far into the future. Through all this, the UK will have to calculate the impact of whatever is agreed with the EU on its efforts to conclude bilateral trade agreements with other countries.

I question how the Government will use the much-vaunted freedom that they and the Prime Minister parade. As my noble friend Lord Purvis indicated, the UK Government are already looking for opportunities to diverge from the EU to demonstrate the symbolic value of Brexit and perhaps to pursue what they see as an advantage. Yet each change, each extra difference adds new friction to the EU-UK trade border. For every action there stands a possible reaction and a cost. We will see as time goes on whether the UK trade machine has the depth and sophistication to walk these lines. The weekend leaks on the working time directive and the Chancellor’s “big bang 2” speech seem to indicate otherwise.

The Bill sets a framework for trade. The Executive have taken upon themselves such powers that they will have no one else to blame for the results.

United Kingdom Internal Market Bill

Debate between Lord Fox and Baroness McIntosh of Pickering

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

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

My Lords, I am grateful to the noble Lord, Lord Stevenson, for introducing these two amendments and giving us the opportunity to probe the very heart of the functioning of the OIM in terms of its independence. Can my noble friend the Minister say how the Government will ensure that this body will be independent? My noble friend will be aware of my concerns and those of others that the Government have got into the habit recently of creating such public corporate bodies and then trying to direct how they operate. Recent examples are, as the noble Baroness Jones of Moulsecoomb, just alluded to, the Trade and Agriculture Commission, which falls within the Department for International Trade, which basically does not provide any resources to those who serve on the commission and, even more recently, the Office for Environmental Protection which, apparently, is to be appointed by and subsumed within Defra. So that is my main concern here, and there is much to commend in Amendment 115 as to how the body corporate is to be set up.

Furthermore, the noble Lord, Lord Stevenson, asks in subsection 2(2) of Amendment 131 for consultation with the devolved Administrations. I would prefer it if went further, as the noble Baroness, Lady Hayter, requested: consent for such appointments should be sought from the devolved Administrations. Presumably, if the Government were to adopt the terms of this amendment, it would be the OIM that would ensure the level playing field, which I imagine is the Government’s intention. However, if it was not the OIM, can the Minister explain which body would, as in subsection 3(2),

“rule that any distortive or harmful subsidies are illegal and should be repaid”,

and, as in subsection 3(4),

“recommend to the Secretary of State changes to the test for a harmful subsidy, the scope of exemptions, and time limits on approvals”?

There should be a body to ensure levelling-up, not just of the regions but between the four nations. I hope that the Government are taking a consistent approach here, in their position on the European Union and their position on state aid between the four nations of the United Kingdom internal market. It would not behove the Government to be seen to be parti pris on their position on competition and state aid in this regard.

I share the concerns expressed by the noble Lord, Lord Purvis, and others, in the previous debate, regarding responses not always being published. I am having great difficulty, and perhaps the Minister can point me in the right direction, but rather than a summary of the responses, it would be enormously helpful if the Government published the responses to the consultation regarding this amendment in full, and preferably before the next stage of the Bill. That would enable us to form our own view of who said what in response to the consultation.

With those few remarks, I would like to put the key questions to the Minister: how do the Government intend to ensure the independence of the OIM, and how do they intend to carry the devolved Administrations with them in this regard?

[Lord Fox (LD)]

My Lords, so far there have been four groups of amendments dealing with the CMA and the OIM, and three different Ministers fielding. That perhaps summarises the fragmented nature of this Bill and the unjoined-up nature of what we are seeking to achieve. In those four groups, and this group, amendments have sought, in a sense, to correct and improve this Bill, but there is no point, because this Bill is beyond that stage. Other speakers have sought to probe and get information from the Government, and there has been no point to that either, because the Government have not answered questions. Despite extremely well directed, forensic analysis and questioning, the Government have ducked, dived and shrugged.

In addition to supporting the request made by the noble Baroness, Lady McIntosh of Pickering, for the consultation to be published, I would like this Minister, who is before us for the first time in this debate, to answer the questions on this group, and to undertake, on behalf of the other Ministers, to answer all the questions that the last four groups have presented, because they are all extremely important to understanding what on earth the Government intend to do.