Foreign Affairs
Lord Hain Excerpts(1 month, 2 weeks ago)
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Lord Hain (Lab)
My Lords, after the Hamas terror of 7 October and the Netanyahu Gaza horror since, I will speak frankly as a former UK Middle East Minister and Secretary of State for Northern Ireland.
First, Israel is not going to destroy Hamas, as its leaders promise—not even by destroying Gaza. Although Israel has seriously damaged Hamas militarily, it is a movement and an ideology that, in many respects, Israel helped promote. Its right-wing Governments thwarted serious negotiations with Yasser Arafat’s more moderate Fatah after Bill Clinton’s Camp David summit in 2000. They also oppressed Gaza residents, imposing a state of siege. Surely, after Israeli bombing kills their relatives and destroys their schools and communities, Gaza teenagers will resist even more, and be recruited even more easily by Hamas and jihadism. As Britain’s troubled history in Northern Ireland vividly demonstrates, if politics does not work, violence and extremism always fill the vacuum.
Remember also that British Governments refused for decades to negotiate with the IRA because of its terrorist outrages. When they finally did so, the 1998 Good Friday agreement happened, supported by a US President, a UK Prime Minister, a UK Foreign Secretary and an EU President.
The notion, also peddled by leaders of the global North, that only negotiations with a discredited West Bank Palestinian leadership can be countenanced will not work. Nor will Netanyahu’s recently reported plan for Gaza to be run by Israeli-approved administrators without links to either the Palestinian Authority or Hamas. There is a salutary history of trying and failing to promote favoured candidates on peoples who are demanding self-determination to choose their own. Like it or not, Hamas will have to be included in some way, as indeed they are now in the Egypt-based negotiations.
In the end, the solution has to be political. Palestinians of whatever political stripe cannot defeat Israel militarily; nor can Israel defeat Palestinians militarily. As Jonathan Powell, Tony Blair’s chief of staff, wrote compellingly in his book, Talking to Terrorists, such conflicts can be resolved only by negotiation. By the way, Arafat had previously been labelled a terrorist with whom Israel would never deal, as also had Nelson Mandela by apartheid’s rulers.
Yet Israel’s right-wing leaders have been hell-bent on turning Palestinian territories into occupied dependencies. The West Bank—small islands of which are nominally administered by Fatah but in practice controlled by Israel—now contains half a million Israeli settlers, and east Jerusalem nearly a quarter of a million. UK Ministers wring their hands, pointing out that such settlements are illegal—but do nothing.
Where has all this got Israel? It is not more but less secure, as the 7 October pogrom palpably demonstrated. Yet the flat rejection of a two-state solution by Netanyahu means permanent Israeli domination, with escalating violence and regional instability. I suggest to the Foreign Secretary that, beyond the current talks, he supports a regional summit involving Israel, Egypt, Saudi Arabia and, yes, Iran too, along with Jordan, Qatar and the UAE. There will be no stability in the region unless all parties are included.
Many in the global South are contemptuous of what they see as profound double standards by global North leaders, including the UK, who quite rightly want backing for Ukrainian self-determination but are complicit in the denial of Palestinian self-determination and culpable in the Gaza horror. The geopolitical breach with the global South is deepening and will cost Washington, London and Brussels dearly in an increasingly turbulent world. Meanwhile, I remain a friend to both Israelis and Palestinians. That is no sell-out of either, but a recognition that they share a future together or they share no future at all worth having.
Israel and Palestine
Lord Hain Excerpts(1 month, 3 weeks ago)
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The Minister of State, Foreign, Commonwealth and Development Office (Lord Ahmad of Wimbledon) (Con)
My Lords, we support a two-state solution. As I said only the other day, that guarantees security and stability for both Israelis and Palestinians. Our position has not changed. My right honourable friend the Prime Minister was clear in his recent call with Prime Minister Netanyahu that a viable two-state solution is the best means to achieve lasting peace. With our allies, we must provide the practical and enduring support to bolster the Palestinian Authority, and the PA itself must take much-needed steps to reform. Importantly, Israel must act to release frozen funds, halt settlement expansion and hold those responsible for settler violence accountable.
Lord Hain (Lab)
My Lords, although many of us join the Government in long backing a two-state solution, how realistic is this now, when Prime Minister Netanyahu has firmly ruled it out, Gaza has been reduced to rubble and Israel is expanding its illegal settlements in the occupied West Bank, including east Jerusalem, to over three-quarters of a million settlers? What alternative is Israel offering if not permanent siege and oppressed status for the Palestinians? Should we not be considering other options—perhaps a negotiated confederal state, with security and self-determination for both Israelis and Palestinians?
Lord Ahmad of Wimbledon (Con)
My Lords, I hear what the noble Lord said, and this is not the first time I have heard suggested alternatives. Given the current situation and the crisis that has gripped the Middle East, from the abhorrent events of 7 October to the tragedy of the ongoing conflict itself—and, of course, given the rights of the Palestinians—it is clear that we must seize the moment. In my career as a Foreign Office Minister, this is perhaps the first time we have seen not just one country or two standing up, or just me standing up at the Dispatch Box, but real live diplomacy and activity. That is not just between the Israelis, the Palestinians, the Americans, us and the Europeans; the region itself is seized by this moment. Through the tragedy of every life lost in Israel, Gaza and the West Bank—every Israeli and every Palestinian life lost—the strongest legacy we can provide is a viable vision and a two-state solution.
Zimbabwe: Election
Lord Hain Excerpts(7 months, 2 weeks ago)
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Lord Ahmad of Wimbledon (Con)
I did not catch that, because of other voices. I will reflect on the Hansard and respond to my noble friend, because I missed the first part of his question.
Lord Hain (Lab)
My Lords, after all the major concerns about the Zimbabwean elections raised by observer missions, and the arrest yesterday of human rights lawyers, can the Minister ensure that these issues will retain a primary focus in the governance reform challenges identified in both the African Development Bank-sponsored debt arrears negotiations and discussions with the Commonwealth regarding readmission?
Lord Ahmad of Wimbledon (Con)
Yes, I can assure the noble Lord we will make exactly those representations, because they are vital to the discussions we are having with key partners about Zimbabwe.
International Anti-corruption Court
Lord Hain Excerpts(9 months, 2 weeks ago)
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The Minister of State, Foreign, Commonwealth and Development Office (Lord Ahmad of Wimbledon) (Con)
My Lords, this Government are fully committed to ensuring that those responsible for the most egregious acts of corruption are held to account. We have considered the idea of an international anti-corruption court, including with 40 international partners in November last year. Together with them, we concluded that now is not the time to endorse a new, bespoke institution of this nature. However, the Government will set out their plans for combating transnational grand corruption in the second UK anti-corruption strategy later this year.
Lord Hain (Lab)
My Lords, I thank the Minister for his reply, but it is very disappointing. Money laundering represents over 5% of global GDP, or $2 trillion each year, yet there is no effective mechanism to prosecute kleptocrats, corrupt businesspeople, oligarchs or their professional enablers. Canada, the Netherlands, Ecuador, Moldova, Nigeria and the European Parliament have recently called for the establishment of an international anti-corruption court, as have over 300 leaders from over 80 countries, over 45 former Presidents and Prime Ministers and 30 Nobel laureates. A group of leading international jurists and other experts is now drafting a model treaty. Will the Government join with them now to tackle this terrible international scourge?
Lord Ahmad of Wimbledon (Con)
My Lords, while I appreciate the long-standing commitment and work of the noble Lord, where I disagree with him is that I believe that much has been achieved and is being done. As I said, we have consulted on this issue extensively; we continue to engage with the countries the noble Lord listed that are involved in the development of this concept. At the same time, as he and other noble Lords may be aware, the UK’s international corruption unit is a world-leading capability; it was set up in 2017 alongside the Five Eyes plus others. Much has been achieved: since 2017, the unit has received 247 referrals of grand corruption from over 40 countries and, as a result, has disseminated 146 intelligence reports, identified £1.4 billion-worth assets, and supported the freezing of £623 million-worth of assets and the forfeit and confiscation of £74 million. As I have said, our work continues. In 2022 alone, intelligence collated across these jurisdictions supported the identification of a further £380 million in stolen assets. We are working, and we are working in co-ordination. I appreciate the strong work the noble Lord has done in this area, but, as I have said, an international institution can be set up, as he will know from his own ministerial experience, only with the support of a broad range of partners. The Five Eyes partners are crucial, and we are working very closely with them.
Ireland/Northern Ireland Protocol: Scrutiny of EU Legislative Proposals (European Affairs Committee Sub-Committee Report)
Lord Hain Excerpts(1 year, 3 months ago)
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Lord Hain (Lab)
My Lords, I too thank the noble Lord, Lord Jay, for his astute chairing, and our clerk, Stuart Stoner, and his expert team for the brilliant job that they do. But, even with such expert scrutiny, there is a loss of democratic accountability—the “democratic deficit”—affecting Northern Ireland following Brexit. Surely the devolved institutions in Northern Ireland should have a much more direct role in the scrutiny of the EU rules that apply to them.
Boris Johnson and the noble Lord, Lord Frost, endorsed by Rishi Sunak, negotiated a deal making Northern Ireland an EU rule-taker, rather than an EU rule-maker, as it was before Brexit. Like Northern Ireland, Norway is in the single market but not in the EU—yet Norwegian Ministers and parliamentarians are able to scrutinise and achieve amendments to all draft EU proposals affecting Norwegians. These consultative rights for EEA members are important to overcome what would otherwise be their own democratic deficit over single market legislation. Norwegian Ministers say that this works well, so why not give similar oversight of the implementation of the protocol directly to the democratic institutions in Northern Ireland? But this is not only a matter for the European Union. Obviously, Norway is a sovereign state, and addressing this Brexit democratic deficit will require the UK Government to allow something different for Northern Ireland, compared with the rest of the UK.
The UK-EU Joint Consultative Working Group—JCWG—which meets monthly, is where the European Commission informs the UK about
“planned Union acts within the scope of this Protocol”
under Article 15. This is a point at which potential difficulties arising for Northern Ireland can be identified and accommodated in the EU’s final decisions. The UK Government should therefore establish formal structures to ensure that the views that they proffer through the JCWG take full account of the views of Northern Ireland Ministers, MLAs, officials and stakeholders. Preferably, Northern Ireland representatives should have direct consultative rights within the JCWG.
Meetings of the joint committee have already seen the First Minister and Deputy First Minister, or their nominees, invited to participate in the UK delegation where the joint committee discussed the protocol. But there is currently no formal mechanism for representation from the devolved Governments in the UK to participate fully in the UK delegation to meetings of the UK-EU joint bodies. The UK Government should therefore commit to raising the status of the Northern Ireland First Minister and Deputy First Minister from invited observers to ex officio members of the UK delegation, where UK-EU bodies are discussing matters relevant not just to the protocol but to devolved competence. There should also be direct consultative avenues for Members of the Legislative Assembly—MLAs—of Northern Ireland with the European Parliament. These are practical and common-sense solutions to a real problem that, quite understandably, exercises unionists. I hope that UK Ministers, the Irish Government and the European Union will support them.
Northern Ireland Protocol Bill
Lord Hain ExcerptsWednesday 2nd November 2022
(1 year, 5 months ago)
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Lord Hain (Lab)
My Lords, I speak to Amendments 21B, 21C, 23B and 23C, in my name and the names of my noble friends Lady Ritchie of Downpatrick and Lady Goudie. I am grateful for their support.
On Amendment 21B, Clause 13(1) removes the jurisdiction of the EU’s Court of Justice altogether, but the Court of Justice jurisdiction is essential to the operation of the single electricity market to keep the lights on in Northern Ireland, which the UK Government have said they wish to see remaining unaffected. This amendment ensures that there will be no inadvertent disruption to the single electricity market through the coming into force of this clause. Surely the Government should accept that.
On Amendment 21C, Clauses 13(4) and (5) allow a Minister of the Crown to make regulation in relation to any provision of the protocol relevant to the jurisdiction of the Court of Justice or the application, supervision and enforcement of the protocol. There is a possibility that this could inadvertently affect the operation of the single electricity market. This amendment requires the Minister to make and publish an impact assessment prior to regulating under this clause in order to prevent such a risk to the single electricity market. I do not see what the problem with my amendment might be; it seems to me entirely reasonable.
On Amendment 23B, the operation of the single electricity market on the island of Ireland comes under the jurisdiction of the Court of Justice of the European Union and is required to be interpreted in the light of case law of the CJEU. The scope of Clause 14 makes this impossible. This amendment would ensure that Ministers regulating in this area under Clause 14(4) would have to make and publish an impact assessment, prior to the regulation, in order to consider its possible negative implications on other aspects of the protocol that the Government wish to protect, including the single electricity market. Again, I cannot see what objection there might be to Amendment 23B.
On Amendment 23C, the operation of the single electricity market on the island of Ireland comes under the jurisdiction of the Court of Justice of the EU and is required to be interpreted in the light of its case law. The scope of Clause 14 makes this impossible and puts Article 9, on the single electricity market, at risk of being excluded from the protocol by accident, even though the Government say they wish to protect it. This amendment would ensure that the functioning of the single electricity market is specifically protected from the scope of this clause to maintain its operation, which is necessary for the electricity supply in Northern Ireland. Again, surely this is a no-brainer for all of us, including government Ministers.
By way of background, a wholesale electricity market is where electricity is bought and sold before being delivered to consumers. Market arrangements require generators and wholesale suppliers of electricity to forecast their generation and consumption and to bid at the price at which they are prepared to buy and sell. Competition between suppliers with equal access to a grid system should ensure value for customers, with a market price based on the minimisation of production cost.
Power markets have been evolving across Europe since the early 1990s. Since the entry into force of the Lisbon treaty in late 2009, the EU gained formal competences in energy and embarked on electricity market reform. A core part of this was the so-called third energy package. To enable cross-border trade in electricity and gas, each coupled market adopts a common set of rules and standardised wholesale trading arrangements so that system operators can work together to allocate cross-border capacity and optimise cross-border flows. This is what is at work in the integrated single electricity market on the island of Ireland.
The SEM is a cross-jurisdictional wholesale electricity market that came into being in 2007. It allows generators and suppliers to trade electricity in a single market across the island of Ireland. Fundamentally, it helps ensure that there is sufficient capacity to meet electricity demand at all times in both Ireland and Northern Ireland. Being part of an all-island market brings benefits to electricity customers in Northern Ireland by reducing electricity prices and increasing the security of supply. It was further cemented in 2018 with the integrated pan-European market design of the third energy package.
An intergovernmental UK-Ireland memorandum of understanding co-ordinates non-mandated market arrangements, but the SEM functions through an overarching European Union-mandated convergence of energy policy and market structures, as governed by certain parts of the European Union acquis. The Ireland/Northern Ireland protocol to the withdrawal agreement provides the basis for the continued operation of the single electricity market after Brexit by including the minimal amount necessary of EU laws on energy markets.
To do this, Article 9 states:
“The provisions of Union law governing wholesale electricity markets listed in Annex 4 to this Protocol shall apply, under the conditions set out in that Annex, to and in the United Kingdom in respect of Northern Ireland.”
Annexe 4 then lists seven Acts that apply to the
“generation, transmission, distribution, and supply of electricity, trading in wholesale electricity or cross-border exchanges in electricity.”
These key elements of European energy law applying in Northern Ireland are, notably, largely in devolved competences. For example, the EU’s regulation on energy market integrity and transparency—REMIT—prohibits insider trading and energy market manipulation and makes provision for the monitoring of the market by regulators. REMIT continues to apply in Northern Ireland through the protocol.
The application of these Acts entails circumscribed participation in the EU market, which requires acceptance of EU governance. In practice, this means that the ultimate arbiter of EU law is the Court of Justice of the European Union. An essential criterion for transposing EU law into single electricity market rules is that single market rules cannot be differentiated across jurisdictions and alignment must be guaranteed for the future.
Article 13 of the protocol states that
“the provisions of this Protocol referring to Union law or to concepts or provisions thereof shall in their implementation and application be interpreted in conformity with the relevant case law of the Court of Justice of the European Union.”
This includes the provisions listed under Annexe 4. This is to secure the governance of the internal energy market, as it covers the single electricity market. This is removed by the Northern Ireland Protocol Bill, Clause 13(1) of which sets out:
“Any provision of the Northern Ireland Protocol, or … the EU withdrawal agreement, is excluded … so far as it confers jurisdiction on the European Court in relation to … the Northern Ireland Protocol”.
The Explanatory Notes underline:
“That is the case whether the CJEU jurisdiction relates to excluded provisions or any other matter.”
With the removal of the CJEU and no means of referencing its case law or jurisprudence, the governance of the single electricity market is put in jeopardy and, thus, the continued functioning of the all-island market is as well. This is happening at a time when the pricing of electricity, security of supply and balancing supply and demand are at an almost unprecedented level of concern to consumers this winter on the island of Ireland and elsewhere in the world, including Great Britain.
A lot of concern has rightly been expressed about the unknowable consequences of the Bill, given that so much of its effect will come through powers that are neither clearly demarcated nor spelled out—the noble Lord, Lord Purvis of Tweed, has spoken at length on this. However, I draw to noble Lords’ attention the dangers in what we do know about the Bill’s actual, if unintended, effects. On coming into force, even this skeleton Bill will be powerful enough to undermine the foundations of the protocol completely, with direct, immediate and practical consequences for Northern Ireland. This is primarily because the Bill removes the Court of Justice of the EU from having a role in the oversight of the protocol. Clause 13(1) sets out that any provision of the Northern Ireland protocol or withdrawal agreement is excluded so far as it confers jurisdiction on the Court of Justice,
“whether the jurisdiction relates to excluded provision or any other matter”.
As such, Court of Justice jurisdiction is removed altogether. Furthermore, Clause 20 means that domestic courts and tribunals cannot refer any matter to the Court of Justice in relation to the Northern Ireland protocol, and that they will not be required to follow the jurisprudence of the CJEU from the day the Act comes into force.
This is not merely a theological matter. Article 12(4) of the protocol spells out what the Court of Justice of the European Union has been given jurisdiction over for Northern Ireland. This includes customs and the movement of goods entering Northern Ireland and technical regulations and certification for goods, but it also includes the single electricity market. In addition, Article 13 states that the implementation and application of the protocol provisions referring to union law, concepts or provisions should be
“interpreted in conformity with the relevant case law of the Court of Justice of the European Union.”
The EU has been absolutely clear that Northern Ireland’s free access to the EU single market is contingent on the jurisdiction and jurisprudence of the Court of Justice of the EU.
I am sorry that I am speaking at some length on this, but it is quite complex and important. To change the position of the Court of Justice as proposed in the Bill would immediately erode the basis for an open Irish border. It is either naive or disingenuous of the Government to claim that the single electricity market will be unaffected by the Bill: the position of the Court of Justice is absolutely essential to its operation. The prospect of the collapse of the single electricity market at one point led UK officials to consider putting generators on barges in the Irish Sea in the event of a no-deal Brexit, which tells us that this is deadly serious.
I remind the Government, keen as they are to claim sovereignty over Northern Ireland, that it is their duty, not the European Union’s, to keep the lights on in Northern Ireland. If the EU decides to prevent the continued free flow of goods and electricity across the Irish border because of the removal of the CJEU from the protocol, it would be not a sign of its malintent but rather a well-flagged consequence of the wanton recklessness of the Government in writing the Bill in this way.
I will refer to another skeleton analogy: the Government are trying to claim that the benefits of the standing, walking protocol can be retained at the same time as cutting off its head and removing several of its major bones. Equipping the Government to fashion new plastic limbs over time to fix the problems that the Bill is deliberately inflicting on the protocol is one thing, but removing the head, in the form of Court of Justice jurisdiction, will of course mean that the protocol simply cannot function, and thus neither can things that it sustains, such as the open border and the single electricity market.
Lord Ahmad of Wimbledon (Con)
I am glad to be of service to the noble Lord.
Lord Hain (Lab)
The Minister has been very generous and kind in saying that he was grateful that I raised the single electricity market, but he has not addressed any of the issues I put to him. If he is not going to do so in his closing speech, could he write to me and say in what way, apart from seeking not to jeopardise the single electricity market, which nobody wants to do, obviously, he is going to prevent it being jeopardised, for the reasons I enunciated?
Lord Ahmad of Wimbledon (Con)
I do not know if I disappoint or please by saying that there are several more pages in my speaking notes which may address in part what the noble Lord, Lord Hain, said, and this relates also to his amendments on the issue of assessments on non-excluded provisions. To make a general point, whether it is the perspective of the Government in introducing the Bill or the sentiments we have heard from our noble friends, including those within the DUP, and the noble Baroness, Lady Hoey, I think we are all coming at this with the end objective of ensuring that the benefits there have been from the market should be protected. I am quite happy to discuss the specifics with the noble Lord, together with officials, after the debate to see if there is a specific insight we perhaps have not picked up on in respect of these amendments, and how we can have a further discussion in this respect. I fully accept the key principle—I think we all do—regarding the protections that have been afforded and the gains that have been made. Of course, no one wants any lights going off anywhere.
It is the Government’s view that Amendments 21C and 23B, in the name of the noble Lord, Lord Hain, would prevent any regulation being made under the powers in Clauses 13 and 14 before an impact assessment had been carried out with regard to the regulation’s effect on non-excluded provisions of the protocol. Regulations under Clauses 13 and 14 should not be presumed to have any impact on non-excluded provisions of the protocol. They are not excluded and will continue to apply—indeed, they will continue to attract the benefit of the EU law principle of supremacy.
However, if the noble Lord is simply after a more general economic impact assessment—this is where I am saying that a discussion may be helpful—I am not sure that these amendments are required either. Regulations under the specified clauses could be highly technical, with little economic impact. For example, Clause 13(5) specifies that regulations under Clause 13(4) may make provision about arrangements with the EU relating to the operation of the Northern Ireland protocol, including information sharing. As such, the Government could be forced to provide an impact assessment on, for example, a data-sharing system between two competent authorities, which has little or no impact on wider parts of the protocol or economic operators—or, indeed, any impact outside of government at all.
I assure noble Lords that the House will have the opportunity to scrutinise any regulations in the usual fashion, and that the Government will provide all the usual accompanying material under the normal parliamentary procedures, including economic impacts where relevant. However, it is the Government’s view that mandating by statute that impact assessments must be provided for every single regulation under Clauses 13 and 14 would be overburdensome, and it does not tally with the standard principles for impact assessments. To add to the point I made earlier, on the specifics that have not been covered in my concluding remarks, I will write to the noble Lord, Lord Hain. As I said, I believe that there is a common cause to be had here, so if time allows, I am quite happy for us to schedule a discussion on this as well.
Clause 13 outlines the exclusions that seek to redress the feeling that a democratic deficit is created by the arrangements for the implementation and enforcement of the protocol. First, via subsection (1), it provides that any provision of the protocol which confers jurisdiction on the CJEU over the arrangements in Northern Ireland is an excluded provision. This means that CJEU decisions, including infractions, will no longer have effect in domestic law across the entire protocol. Secondly, via subsections (2) and (3), it assists in restoring the Government’s sole oversight of arrangements on the ground in Northern Ireland, providing that the provisions relating to the powers and presence of EU representatives are excluded. Finally, to address the point raised by the noble Lord, Lord Ponsonby, via subsections (4) and (5) it allows for the establishment of replacement arrangements, which provide the ability to put in place new supervisory and data-sharing arrangements with the European Union. This will support assurance processes to protect both the UK and EU markets and facilitate co-operation between UK and EU authorities. That is why we believe that the clause should stand part of the Bill.
Again, I am grateful for the discussions and debate on this group. While I am not suggesting that all noble Lords will have been fully satisfied by my response, I hope that they will be minded not to press their amendments at this time.
Northern Ireland Protocol Bill
Lord Hain ExcerptsMonday 31st October 2022
(1 year, 5 months ago)
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Lord Kerr of Kinlochard (CB)
I yield to none in my respect for the noble Lord, Lord McCrea, and the way he pursues this argument. It was an argument that we had earlier in our debate, and I share his distaste for the protocol, as he knows. I do not agree with the noble Lord, Lord Hannan, that there is no democratic deficit. I think there is a real democratic deficit and it could be put right. It would be good if the noble Lord would think about the suggestions made by the noble Lord, Lord Hain, earlier in our debate. The argument that the protocol is inconsistent with the Good Friday agreement comes across rather badly from those who opposed the Good Friday agreement. I myself was strongly in favour of the Good Friday agreement and I was sorry to see the DUP against it at the time. It is hard to sustain the argument now, in any case, given that all the parties to the withdrawal agreement—in which the protocol rests—do not agree with it. The United Kingdom Government do not buy the argument that the DUP are making—or they have always, up to now, not bought that argument. Although I understand the concerns the noble Lord puts forward, I do not think it works as a matter of law or that the Gibraltar precedent—although he is quite right about it—is relevant.
Lord Hain (Lab)
Will the noble Lord accept a small intervention to follow up on the point he made about the democratic deficit? I agree with him and he agrees with me on it. Would he confirm that Norway, for example, does not have Ministers in the Council of Ministers or direct representation in the European Parliament because it is not in the European Union, but does have consultative rights? It is consulted on all EU single market matters. Northern Ireland could be consulted in a similar way.
Water Companies: Borrowings
Lord Hain Excerpts(1 year, 7 months ago)
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The Minister of State, Department for the Environment, Food and Rural Affairs and Foreign, Commonwealth and Development Office (Lord Goldsmith of Richmond Park) (Con)
My Lords, as of 31 March this year, water companies have reported total borrowing of £57.6 billion. Privatisation of the water sector has delivered around £170 billion of investment through private finance and this country would not have seen that level of investment if the water industry was in public ownership. Holding a licence to provide an essential public service of this sort is a privilege. Governments and regulators have high expectations of water companies and of the financial behaviours of their owners and investors.
Lord Hain (Lab)
My Lords, surely the Government have to reform the privatised water system. Despite a huge hike in pumping raw sewage into rivers and off beaches, abject failures to fix chronic and widespread leakages amid hosepipe bans and a total failure to reduce discharges from storm overflows, annual bonuses paid to water company executives rose by 20% in 2021. Since privatisation, customers’ bills have shot up by 40% and the companies have paid out £72 billion in dividends. Yet in Wales, 45% of rivers are of good ecological status, compared with 14% in England. Wales also secured 45 Blue Flag beaches and marinas last year, proportionately many more than England. Will Ministers replace the broken England model with the Welsh not-for-dividend one, which also means that returns going to shareholders are invested in infrastructure and capital is raised at a lower rate?
Lord Goldsmith of Richmond Park (Con)
My Lords, I cited figures in relation to investment by the sector, so I will not repeat them. But I make the point that, as a consequence of the Environment Act, which this House, along with the other place, brought into law just a few months ago, companies are now required to be transparent in a way that they never had to be before about how executive bonuses and dividends are linked to services for customers. Ofwat is still going through the process but will have the power, as a consequence of the Environment Act, to tie the licensing system to the performance of companies in relation to that link between pay and performance. That is a first; it would not have happened were it not for the Environment Act.
In relation to storm overflows, I am sure the question will come up again but the noble Lord exaggerates the course of action over the last few years. I will not for a second pretend that we do not have a problem with sewage flowing into our waters but the situation is getting better, not worse.
Autocrats, Kleptocrats and Populists
Lord Hain Excerpts(2 years, 2 months ago)
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Lord Hain (Lab)
My Lords, Bain & Company presents itself as a reputable global consultancy operating across the world, with an office in London and recent contracts worth £55 million with the Cabinet Office alone. Yet in South Africa, Bain brazenly assisted former President Jacob Zuma to organise his decade of shameless looting and corruption, with the company earning fat fees estimated at £100 million—or 2 billion rand—from state institutions.
South Africa’s State Capture Commission, a judicial inquiry headed by Deputy Chief Justice Zondo, indicted Bain’s work with the South African Revenue Service as “unlawful” and recommended that all its South African public sector contracts be re-examined with a view to prosecution. At the time, Bain South Africa’s work was endorsed by both its London office and its US headquarters in Boston. Bain has also been disgracefully smearing Mr Athol Williams, a key whistle-blower praised by the Zondo commission who recently had to flee to the UK for his safety.
Given the scandalous collusion of Bain UK and Bain USA. I am asking that the UK Government and the US Government immediately suspend all government contracts with Bain. I wrote three weeks ago to the Prime Minister requesting this, and he has just replied stating that the Cabinet Office will
“look into this matter with urgency”
and the Chancellor of the Duchy of Lancaster wrote to me yesterday saying that the Government will be contacting Bain. I hope that those contracts will be suspended and that that is the case for all public sector contracts in the UK.
However, Bain’s shamefully shady behaviour is just the tip of the iceberg. The prodigious looting, corruption and money laundering under former President Zuma would not have been possible without the complicity of Bain, KPMG, McKinsey, SAP, Hogan Lovells and the banks HSBC, Standard Chartered and Bank of Baroda. Those fee-clutching global corporates and turn-a-blind-eye Governments from London and Washington to Dubai, Delhi and Beijing helped to rob South African taxpayers, contributing to a catastrophic loss of South Africa’s GDP of around one-fifth. Economists estimate the full cost of the Zuma state capture to be a monumental £750 million or 1.5 trillion rand. The Government’s total annual expenditure is just 2 trillion rand annually. These global corporates all obtained sweetheart state contracts, which helped Zuma’s business associates, the Gupta brothers, to loot the state. Global banks such as HSBC, Standard Chartered and Baroda transferred this looted money through their digital pipelines to less regulated jurisdictions such as Dubai and Hong Kong, or British Overseas Territories in the Caribbean, to then clean the money by mingling it with other funds, disguising its origins and enabling it to be more easily spent.
Lawyers and accountants assisted the Guptas to set up complex shell, or front, companies, hiding their true owners—the Guptas or their associates—and enabling money to be moved to a country where there is low transparency. Dishonest audits left suspicious transactions hidden. Estate agents received laundered money during Gupta property purchases. Global brand names from KPMG to McKinsey, from HSBC to Standard Chartered, all profited while the Guptas hid and spent their stolen funds that could otherwise have been destined for essential South African public services, job creation or infrastructure, leaving South Africa’s public finances near-bankrupted and its growth stalled.
I therefore find it completely unacceptable that Bain is licensed to operate commercially in the UK, the USA or anywhere else in the world—at least until it has repaid all its fees earned from the South African state during the Zuma-Gupta years and answered charges in the courts there. Unless the UK, US, Chinese, Indian and UAE Governments co-operate with each other, state capture will happen again, either in South Africa or other countries.
The truth is that international criminals continue to loot and money-launder with impunity through centres such as London, New York, Hong Kong, Delhi and Dubai. Ministers talk the talk on corruption but refuse to take the necessary tough action against guilty big corporations to stop it. Meanwhile, financial crime is estimated by the United Nations Office on Drugs and Crime, to be worth around 5% of global GDP, or $2 trillion, each and every year.
UN Peacebuilding Fund: Financial Support
Lord Hain Excerpts(2 years, 10 months ago)
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Lord Ahmad of Wimbledon (Con)
The noble Lord will know that I respect his deep insights into the workings of the UN. However, as I indicated, my experience, through my direct dealings, is that, while these are challenging circumstances, the United Nations recognises the circumstances we are working in and, equally, the importance of the United Kingdom’s continued support of the multilateral system, through the UN.
Lord Hain (Lab) [V]
My Lords, surely the noble Lord, Lord Ahmad, must agree with Mark Lowcock, a former Permanent Secretary for the Department for International Development, who said that the Government’s aid cuts are “very corrosive of trust” and confidence in the UK globally. This is especially the case in Myanmar, Yemen, South Sudan, Nigeria, the Central African Republic, Ethiopia and Somalia. At least 23 partner organisations from these countries will tragically have to wholly or partly suspend their plans to build peace in these areas of serious conflict.
Lord Ahmad of Wimbledon (Con)
My Lords, I accept that, because of the reductions we have had to make, particularly to ODA, there are projects we have previously supported that may or will not receive funding. However, we have specifically targeted our funding. I cite one example of a country the noble Lord mentioned, South Sudan, where a particular focus has been on addressing violence against women and we continue to support initiatives implemented by the UNFPA, UNICEF, UNDP and UN Women.