Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Hendy Excerpts

Committee stage
Tuesday 7th May 2024 Lords Chamber

[Baroness Noakes (Con)]

My Lords, I have Amendment 28 in this group and I thank the noble Lord, Lord Pannick, for adding his name. I should first say that I am in complete agreement with the thoughts that lie behind Amendments 18 and 29, to which the noble Lord, Lord Verdirame, has spoken so eloquently.

My Amendment 28 is simply a more direct way of dealing with the same problem. It deletes paragraph 6 of the schedule in its entirety, so that public authorities cannot use international law considerations as a means of avoiding the effect of Section 1 of the Bill. Public authorities are not experts in international law but might well seek to use ill-founded concerns about the UK’s adherence to international law as a smokescreen behind which they believe that they can hide their boycott activities. Put simply, it creates a huge loophole in the Bill.

I tried to compare the Bill with last year’s Procurement Act to see whether the exclusions in the schedule to this Bill are the same as the mandatory and discretionary grounds for exclusion in the Procurement Act. This was not easy, because it is clear that two completely different sets of draftsmen have been involved in the two Bills. However, the one thing that I am pretty sure of is that the Procurement Act did not have an international law exclusion ground, so the inclusion of paragraph 6 in the schedule to this Bill is somewhat puzzling.

I shall comment briefly on Amendment 31 in this group, in the name of the noble Lord, Lord Kennedy, and the noble Baroness, Lady Blower, because that would extend the range of things that public authorities could look at to breaches of international law outside the UK. Not only is this way beyond the Procurement Act exclusions as well, but it adds yet another loophole, making the loophole as big as it could possibly be in order to allow public authorities to justify boycotts. For that reason, I cannot support it. I look forward to hearing the Minister’s rationale for the inclusion of paragraph 6 in the schedule.

[Lord Hendy (Lab)]

My Lords, I shall speak to Amendment 31 in my name and that of the noble Baroness, Lady Blower. I have no observations on the amendments that have just been spoken to.

Paragraph 6 of Schedule 1 disapplies the bar in Clause 1 of the Bill on a public entity, for want of a more precise definition, from taking into account political or moral disapproval of a foreign state’s conduct in making procurement or investment decisions in one particular situation. A procurement decision is defined in Clause 2(2) as

“a decision about a contract for the supply of goods, services or works to the decision-maker”.

Paragraph 6 applies where the decision-maker reasonably considers that its political or moral disapproval of a foreign state’s conduct is relevant to whether the procurement or investment decision would place the UK in breach of its international law obligations. I have no problem with that at all.