Economic Activity of Public Bodies (Overseas Matters) Bill

Debate between Lord Hendy and Baroness Noakes

Committee stage
Tuesday 14th May 2024 Lords Chamber

[Lord Hendy (Lab)]

My Lords, in the unavoidable absence of my noble friend Lady Blower, and at her request, I beg to move Amendment 30, which is intended to add to paragraph 6 of the schedule.

The paragraph, which we discussed in Committee last week, permits a decision-maker to take into account whether the decision might put the UK in breach of its obligations under international law. In the last debate, we discussed the nature of the international law obligations comprehended in this paragraph and the question of who determines whether there has been a breach of them. I do not seek to reopen that debate; this amendment is not dependent on the outcome of it.

The amendment would make it clear that the decision-maker will be permitted to take into consideration and reject a tender or an investment that the decision-maker reasonably considers might put the UK in breach of its obligations under the genocide convention, the Universal Declaration of Human Rights or any UN Security Council resolutions supported by the United Kingdom. The amendment would still stand and have force, whether or not the Government accept amendments along the lines suggested by the noble and learned Lord, Lord Etherton, and the noble Lord, Lord Verdirame, identifying what entity appropriately determines what amounts to a UK breach of international law. Amendment 30 merely clarifies that the conventions and resolutions mentioned in it are to be regarded as UK obligations.

I find it impossible to see what conceivable objection there could be to identifying matters of such grave importance to a law-abiding nation. The rationale is so obvious that I cannot think of anything more to say in support of my noble friend Lady Blower’s amendment, and I look forward to hearing that the Minister will support it.

I will now speak to Amendment 32. Paragraph 8 of the Schedule permits the potential decision-maker on procurement to take into consideration certain forms of “labour-related misconduct”. The problem is that that is a very limited list. We touched on that in Committee last week. In the last debate, the Minister asked me to provide further details on whether the violations of core labour standards would be covered by the provisions of paragraph 8. I looked at that matter again and did not take up her kind invitation to write to her, because Amendment 32, which was not before us last week, makes clear the distinction between the core labour standards identified in the amendment and the standards set out in paragraph 8.

I will explain. Paragraph 8 is confined only to conduct that would amount to a criminal offence in relation to slavery or human trafficking orders, failure to pay the national minimum wage and labour market orders under the Immigration Act. That list does not currently permit those making procurement and investment decisions to have regard to the fundamental labour standards binding on all countries by virtue of their membership of the ILO. As a matter of convenience, we can take those standards from Articles 399(2) and 399(6) of the trade and co-operation agreement—the Brexit deal—signed by our then Prime Minister in 2020, where they are conveniently summarised.

The provisions commit the UK to respect, promote and effectively implement the ILO Constitution, which includes the Declaration of Philadelphia of 1944, the

“ILO Declaration on Fundamental Principles and Rights at Work and its Follow-up, adopted at Geneva on 18 June 1998 … the ILO Decent Work Agenda as set out in the 2008 ILO Declaration on Social Justice for a Fair Globalization”,

and the fundamental ILO conventions. The fundamental ILO conventions are those identified in those provisions of the Trade and Cooperation Agreement and in the amendment. They protect freedom of association and the effective recognition of the right to collective bargaining; the elimination of all forms of forced or compulsory labour; the effective abolition of child labour; the elimination of discrimination in respect of employment and occupation; decent working conditions for all with regard to, inter alia, wages and earnings, working hours, maternity leave and other conditions of work; health and safety at work, including the prevention of occupational injury or illness and compensation in cases of such injury or illness; and, finally, non-discrimination in respect of working conditions, including for migrant workers.

The only point in that list which is included in paragraph 8 of the Schedule is the second point that I mentioned: the elimination of all forms of forced and compulsory labour. That is the only point at which my amendment and paragraph 8 coincide, because paragraph 8 of the Schedule deals with slavery and trafficking. However, all the other elements of the fundamental labour standards are outside paragraph 8, even though they are binding on every country which is a member of the ILO by virtue of its membership and, regardless of whether they have ratified these conventions, they are matters of customary international law. These are vitally important standards, as the UK government representatives will doubtless reiterate at the International Labour Conference of the ILO, which takes place in June.

Plainly, paragraph 8 does not go far enough. International labour standards are important for ameliorating the conditions of workers in less developed and authoritarian regimes, and, from a more self-interested perspective, for diminishing the extent to which UK manufacturers and UK suppliers of services and works are undercut by competitors seeking to, as I put it on the last occasion,

“exploit cheap labour, poor conditions, inadequate standards, lack of enforcement, and powerless trade unions”.—[Official Report, 7/5/24; cols. 23-24.]

I refer to the examples I gave on the last occasion, but I will not repeat them.

Reverting to the point made by the noble and learned Lord, Lord Etherton, and the noble Lord, Lord Verdirame, on the last occasion, identification of whether there has been a breach of a fundamental ILO convention is not here left to the lay opinion of the decision-maker in the public entity. The ILO has extensive and long-established machinery for determining whether each state is in conformity with each of the fundamental conventions and each of the conventions that state has ratified. The UK fully participates in that machinery and those determinations. Why, then, I ask rhetorically, should the minimum standards of the fundamental international labour conventions, which are all ratified by the UK, not be included in the list of legitimate labour-related misconduct which procurement decision-makers can take into account under the Bill? I wait with anticipation to see whether the Minister will seek to justify their exclusion.

[Baroness Noakes (Con)]

My Lords, when we debated paragraph 6 of the Schedule in an earlier group, I argued that it was inappropriate to include an international law exception in the Bill. Therefore, it will not surprise the noble Lord, Lord Hendy, to find that I do not support the extension to paragraph 6 that his Amendment 30 seeks to achieve.

The briefing sent by the Palestine Solidarity Campaign asserted that without this amendment, the Bill could compel public bodies to contravene the genocide convention. This extraordinary statement was explained in the context of the much-publicised opinion of a number of UK lawyers, including the noble and learned Baroness, Lady Hale, that the International Court of Justice had ruled that there was a plausible case that Israel has committed genocide. As the then President of the ICJ subsequently made clear, this is a complete misinterpretation of the ICJ’s judgment. Judge Joan Donoghue, the then President of the ICJ, has stated that the court decided that the Palestinians had a plausible right to be protected from genocide and that South Africa had the right to present that claim in court. However, to correct something that is often said in the media, the court did not decide that the claim of genocide was plausible. So the items of international law referred to in the amendment, including the genocide convention, basically have the name “Israel” etched on them. Whether by design or otherwise, this amendment would simply make it easier for public authorities to find excuses to boycott Israel and it would be very damaging if this amendment were accepted into this Bill.

Amendment 32, tabled by the noble Lord, Lord Hendy, raises rather different issues. I am conscious that I am in dangerous territory because of the acknowledged expertise in labour law of the noble Lord compared with my ignorance of labour law. However, it is my understanding that the ILO conventions do not have direct effect in the UK. I thought that we achieved compliance through our domestic legislation. The noble Lord spoke about ILO matters on the last Committee day and, while he made the point that the UK is bound by the ILO conventions, I do not think that he claimed that they had any direct effect in UK law.

If I am correct, this amendment is a very unwelcome addition to the Bill because it seems to give full legal effect to the ILO conventions directly. These conventions are not drafted as stand-alone laws but in rather broad terms. They lack a lot of definitions and the language is often rather vague. That is why national Governments have to adopt them using their own legislation. I am not speaking against the ILO conventions; I have no views one way or the other on the conventions. My point is that we comply with these conventions through our national law and that law is the foundation of labour-related misconduct, which is covered in paragraph 8. It seems to me that paragraph 8 means that we can hold overseas suppliers to the same standards to which we hold UK suppliers. In particular, it aligns with the provisions of the Procurement Act which was passed last year. That is a wholly proper basis for this Act, rather than some broader concept of principles that cannot be read directly into our law.

--- Later in debate ---

[Baroness Noakes (Con)]

I have never been a member of the Constitution Committee—I am certainly not a current member—so I simply cannot answer that question. I do not know why it has reached the conclusions that it has, but I believe that they are not in accordance with the impact of Clause 4 as drafted.

When dealing with stopping people doing things and making judgments about whether doing so is right, a balance always needs to be struck. In this case, the Government have tilted the scales in favour of social cohesion. People may think that that is the wrong decision and that allowing elected officials to speak on behalf of an authority in the way that they want to is a price worth paying. I believe that, because of the limited nature of Clause 4 as drafted, it strikes the right sort of balance in this case.

We must remember that this Bill does not stop elected officials speaking in their own capacity, nor does it stop bishops doing so—not that that would ever be an easy thing to do. Individuals in public life can have a big impact on social cohesion, but they are not debarred by this Bill from giving their own views on BDS activities, even though they would have such an impact. In that sense, this Bill is a modest change to the status quo on public statements. It is certainly not as far reaching as people have tried to make out. I would like to get a little balance in this debate.

[Lord Hendy (Lab)]

My Lords, the noble Baroness asserted that Clause 4 does not apply to individuals but only to entities. Clause 4 says:

“A person who is subject to section 1 must not publish”,


and so on. In law, a “person” could be a corporation or an individual, but Clause 1 is quite clear in referring to a “decision-maker”, which can clearly be an individual. One can easily visualise a public entity where the decision is made by one person who has had authority delegated to them, a committee or group of people who have the power to make such a decision or the full council, body or whatever it may be. Clearly, Clause 4 is capable of being directed at individuals.

[Baroness Noakes (Con)]

I hear what the noble Lord is saying. Clause 1 affects persons who are decision-makers. Decision-makers are defined in Clause 2, which uses the definition of public authority. As I said earlier, there are a very small number of cases where individuals can be decision-makers. It is not a question of people taking delegated authority to be decision-makers; if I were in a council and delegated to the chief executive, they would not thereby become the decision-maker. The decision-maker remains the public authority under the terms of Clause 2.

Economic Activity of Public Bodies (Overseas Matters) Bill

Debate between Lord Hendy and Baroness Noakes

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.

Strikes (Minimum Service Levels) Bill

Debate between Lord Hendy and Baroness Noakes

Committee stage
Thursday 23rd March 2023 Lords Chamber

[Baroness Noakes (Con)]

The purpose of the Bill is not to remove protection for unfair dismissal; the purpose of the Bill is to ensure that minimum service levels can be guaranteed for those who rely on the services, and we are trying to find practical ways through that. I was inviting noble Lords to find ways did not simply rip the heart out of the Bill.

[Lord Hendy (Lab)]

I just say to the noble Baroness that there is nothing wrong with conformity being voluntary. The whole basis of the ILO jurisprudence is that minimum service levels and requisitioning should be agreed voluntarily between the unions and the employers. In most of the countries of Europe where they have minimum service levels, volunteers are sought to provide the minimum service. That is also true in this country. We have been hearing for days about the local agreements that are reached in all the six sectors identified here.

That is done on a voluntary basis, and the people who do the work volunteer to do it. They speak to their union, and the union says, “Somebody has to do it; you’re going to do it”, and they say “Okay, fine if that is the price of having the industrial action and bringing pressure to bear to maintain our standard of living, that is the price I am prepared to pay”.

There is nothing wrong with voluntariness. It does not detract from the rest of the machinery of the Bill in setting minimum service levels and issuing work notices, if that is really what the Bill is intended to do.

Procurement Bill [HL]

Debate between Lord Hendy and Baroness Noakes

Report stage
Monday 28th November 2022 Lords Chamber

[Baroness Noakes (Con)]

My Lords, I have Amendment 164 in this group, to which my noble friend Lord Moylan has added his name. Before turning to that, I echo what other noble Lords have said in thanking my noble friend the Minister for her amendments on SMEs. I am very glad that she has taken into the Cabinet Office the evident passion she demonstrated for the cause of SMEs when she took part in Committee on the Bill. Of course, there is no one silver bullet that is going to solve all the problems of SMEs engaging in public procurement, but I believe that most of the amendments before us here will contribute to an important advance in that area.

I have a concern about Amendment 134, which is one of my noble friend’s amendments. It keeps the new Clause 11 duty out of the enforcement clause, Clause 92. That is a pity, because it means that SMEs, which think that that duty is not being complied with, will have to fall back on judicial review—and, as we know, judicial review is not a practical remedy available to SMEs. I regret that. I similarly regret Amendment 140 in relation to procurement oversight recommendations, and I hope that the Government will have an opportunity to think again about both those areas when the Bill moves to the other place.

My Amendment 164 is aimed at the same target as Amendment 163 in the name of the noble Baroness, Lady Bennett of Manor Castle, who was not in her place when the debate started earlier this evening. I was expecting the noble Baroness, Lady Bennett of Manor Castle, to explain the amendment, and then I was going to come in behind it. They are both sourced from an amendment suggested by the Local Government Association. It concerns Section 17 of the Local Government Act 1988 and the exclusion of non-commercial interests that is required by that section. Clause 107 allows regulations under this Bill to disapply that duty for below-threshold contracts. The issue raised by the Local Government Association was that that should not be just permissive but should be an absolute requirement.

The noble Baroness, Lady Bennett of Manor Castle, tabled an amendment in the form originally suggested by the Local Government Association. I have been around a little longer than the noble Baroness, Lady Bennett of Manor Castle, and have debated may/must amendments in relation to whether regulations should be obligatory or permissive. It is a good technique for discussing issues in Committee, but when we get to the sharp end of the business of legislation, the Government always resist a regulation-making power being obligatory—and for good reason, because it ties the hands of today’s Government and any future Governments. I accept that, and I am sure that the Opposition Benches who may want one day to be making legislation of their own would accept that as well. So I retabled the concept of the amendment by inserting below-threshold contracts into the list of things that could be done with this power, in the hope not that my noble friend would accept the amendment but that she would give a clear commitment at the Dispatch Box today to use the regulation-making power at the appropriate time to ensure that below-threshold contracts are excluded from the ambit of Section 17, as I mentioned. I look forward to hearing what the Minister has to say.

[Lord Hendy (Lab)]

My Lords, I rise to speak to Amendment 162A, which rather neatly follows the noble Baroness, Lady Noakes, because it deals with Section 17 of the Local Government Act 1988. Its intention is to remove the prohibition in that provision which prevents local authorities taking into account the terms and conditions of the staff of the supplier, or their legal status. The thought behind this is that public authorities should take into account the terms and conditions and the legal status of those who carry out the work under these public contracts. The restriction applies to local government only and not to other public authorities.