Nationality and Borders Bill

Lord Hodgson of Astley Abbotts Excerpts

Lords Hansard - Part 2 & Committee stage
Thursday 27th January 2022 Lords Chamber

[Baroness Blower (Lab)]

My Lords, I did not speak on Second Reading, but I am delighted to have been here today to have heard the speeches from noble Lords, and what an interesting debate it has been. I have learned a good deal, and I am indebted to the Bingham Centre, whose publications I now read avidly to inform myself about legislation that comes before this House.

I am rather pleased to be following the noble Lord, Lord Hunt, because I was persuaded of the problems with Clause 9 by one of the paragraphs in the analysis from the Bingham Centre:

“Clause 9 departs from the requirements of the Rule of Law by allowing a British citizen to be deprived of their citizenship without even being warned about it, or told the grounds for it. There is zero judicial or parliamentary oversight of the dispensation of notice, and the grounds can be as insubstantial as the mere administrative inconvenience that it is not reasonably practicable to give notice.”


If that is what is intended by the legislation before us, there is definitely a chilling effect, as referenced by the noble Baroness, Lady Warsi, in the suggestion that this is how we should operate. I do not do demur from the argument that there will be difficulties at some point, as outlined by the noble Lord, Lord Hunt, but these are very wide powers and they have, as the Bingham Centre says, no judicial or parliamentary oversight at the point at which they would be invoked. Giving these powers to the Home Secretary—any Home Secretary—is unacceptable. In the words of the noble Baroness, Lady Mobarik, they would be divisive and would, in my view, not accord with the values of fairness, of justice or of equality before the law.

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, my noble friend Lord Hunt narrowed the debate to the issues that are in the clause, but the noble Baroness, Lady Blower, has widened it again by discussing broader powers. I do not have my name to any of the amendments, but I have been listening carefully to the speeches; indeed, we have been listening for the last hour and a quarter. Like other Members of your Lordships’ House I have had a volume of briefing, some of it arriving very late—a point made by the noble Baroness, Lady Hamwee, earlier in our proceedings. It is quite hard to take it on when it arrives the morning before you are due to participate. Some of that briefing seems to be fairly hyperbolic, and I am not sure it is in terms that help a calm discussion of what has at its core the really serious point that my noble friend made about keeping people safe. Phrases such as “two-tier citizenship” do not help us to establish in a calm way what the underlying effect, impact and purpose of the clause is as presently drafted.

That said, when you pick up the Financial Times of 21 January and see that the president of the Law Society has the lead letter with the headline,

“Legal changes will put UK rights culture in peril”,


while other submissions suggest that the rule of law is being undermined, one has to sit up and take notice. I am not a lawyer, as the House will be aware, but I absolutely, comprehensively and unequivocally support the rule of law as a cornerstone of our society. So, in the couple of minutes that I have, I would like to try to pierce the fog of claim and counterclaim to see if one can reach any sort of firm ground. My respect for the rule of law stems from a lecture that I heard 50 years ago. It is our fate in this House to listen to an awful lot of speeches and an awful lot of lectures, and many of them disappear from one’s mind almost as soon as the speaker sits down, but this lecture from 50 years ago rings as true to me today as it did then. It came about because for a time after I finished university I went to live in the United States and Canada, and nearly stayed there. I went to do an MBA at the Wharton School of finance in Philadelphia. The school used to arrange for outside speakers, eminent people in various fields, to come and talk about their experiences.

One such person was a Cambridge University professor called Peter Bauer, later a member of your Lordships’ House as Lord Bauer, of Market Ward in the City of Cambridge. Peter Bauer was Jewish, born in Budapest in the closing years of the Austro-Hungarian empire, 1914-15, and his great contribution was looking at the role of development economics and how we manage to deal with it. That afternoon, he explained how no country could hope to survive without two things: the rule of law and respect for property rights. He went on to say that the rule of law was not an absolute; it was relative, and it depended on what he called the informed consent of a population—that is, if a large proportion of the population, having heard the arguments, had an informed position and did not agree with it then the rule of law was not assisted but undermined. In his view, to use an oft-quoted phrase, the law is too important to be left to the lawyers. In considering the difficult issues raised by the speeches and by Clause 9, I would like to test them against the Bauer “informed consent” test. In that sense, I have drawn certain conclusions but I am not on the Front Bench, so I hope my noble friend can reassure me that the interpretation I have made of the clause is in fact in accordance with reality.

Let us assume that we are on the lower deck of the Clapham omnibus. The passengers on the Clapham omnibus are our fellow citizens. They are a questioning crowd. They do not think the Government always have a lot to offer, and they think political parties of all persuasions probably have rather less. If we were to begin by explaining to them that our wish was to discuss the issue of the deprivation of citizenship, they would begin by asking, “Are the Government proposing to change the basis on which citizenship can be removed?” As I understand it, the answer is no. “If there is no change to that,” they would say, “then what is the change going to be?” The answer would be that if, after reasonable effort, the person who had done terrible things to our country could not be found, citizenship could be removed without notice being given directly to the person affected.

The people on the bus might then ask us, “If this change were not made, would people be able to hide themselves away to evade justice?” The same question might be asked about people who happened to live or ended up in war zones or areas of conflict. We would have to tell them that that would mean that they could not have their citizenship removed, because we could not reach them. Because they are suspicious of the Government, the travellers on the bus would ask, “Could the new procedures be appealed against, or are they just a fiat, without any appeal?” I understand that they can be appealed against. Because it is a Clapham omnibus, there will be people from all parts of our community, minority as well as majority, and they would want to be reassured that this was not going to be used, as my noble friend Lady Warsi suggested, against one particular part of our community. There is no evidence that I have seen that it is so designed.

Finally, I think they would say, “How big a problem is this?”. In particular, the point made by the noble Lord, Lord Anderson, “How many people have had their citizenship removed on the grounds that it was not conducive to public good?” That is a big catch-all. I understand that fewer than 20 people on average have had their citizenship removed in recent years. Will my noble friend confirm that? If we had informed consent of what was planned on the Clapham omnibus—if Peter Bauer’s test was used—I think people would understand why this was being done.

We have heard a lot about the important moral case for protecting the position of everybody in our society, including that very small number of people who set out deliberately to do us terrible harm. However, as we struggle to balance the conflictive needs of freedom and security, we must not overlook the moral case for the silent majority—the millions of our fellow citizens who look to the Government to keep them safe and who do not expect offenders to be able to evade the consequences of their actions.

Nationality and Borders Bill

Lord Hodgson of Astley Abbotts Excerpts

2nd reading
Wednesday 5th January 2022 Lords Chamber

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, it is a pleasure to follow my noble friend Lord Leicester, and I agree with very much of what he had to say. I note that I am to be followed by the noble Baroness, Lady Lister. The noble Baroness and I have made common cause on a number of issues, but tonight she will probably disagree with almost every word I am going to say, because I think the direction of travel of this Bill is a good one. There are issues we shall need to think about, debate and possibly amend in Committee, but today, at Second Reading, we are discussing the strategic objectives of the Bill, and I think these are right, worthy and in tune with the wishes of the British people. I do so on three grounds: fairness, impact and morality.

First, on fairness, it cannot be right at any level to allow people, however desperate, to be able to game the system which governs legal entry to this country. To allow this to happen is to create the major pull factor that my noble friend Lord Wolfson raised in his opening remarks. It is not fair to those people, possibly equally desperate, who have followed the legal procedures, and it is not fair to the British people. As a nation, we place great weight on fairness, and nothing is more likely to undermine public consent for our immigration policies than a view that the regulations are being evaded and abused.

Secondly, by impact, I mean the effects, in the widest sense, of rapidly increasing population in what is already a relatively crowded island. It is not just about immigration, because some of our population increase comes about from the natural increase of the excess of births over deaths. Since the Blair Government opened our borders to mass immigration, we are likely to have seen an increase in our population of 13 million —8 million so far, and another 5 million projected by the ONS. That is 25% of our population in 1997.

When you give those figures, people look at you as though you are a little Englander—not so. I fully accept the new arrivals bringing an economic and cultural dynamic from which our society has benefited, but this is about scale and thinking about the widest impacts of population growth and responding to the concerns of the people of this country in a way that builds trust in government. What are those concerns? They include the impact on our economy, our national food and water security, our environment, our ecology, our society and, last but not least, our ability to meet our climate change treaty obligations. For all these reasons, it is very important that we keep tight control of the numbers arriving. In particular, we need to discourage—as the Bill seeks to do—forum shopping, which, as the noble Lord, Lord Green, pointed out, is an issue to which this country is particularly vulnerable.

Finally, I turn to the difficult issue of morality. Here I emphasise, or follow, the remarks of the right reverend Prelate the Bishop of Durham. I think we can all agree that what we really value is compassion linked to a sense of community and of civic responsibility. When we see our fellow human beings in desperate straits, we want to help, particularly if they are children.

Professor Diana Coole of London University has written extensively on the dangers of trying to create a general policy based and founded on the tragedy of an individual or a series of individuals. Yes, we want to give a hand to the Afghans whom we saw in terrible circumstances last autumn. Yes, we want to give a hand to the Hong Kong Chinese who are now under threat from the Beijing Government. Yes, of course, we want to give a hand to the desperate people we saw in the channel last autumn. But as the noble Lord, Lord Alton, will point out in his debate tomorrow, there are 82.4 million displaced people worldwide and many of them are in very serious situations.

To those who suggest that the way to deal with this is to open more legal channels, process applications faster and process those applications at source to cut out the people smugglers, I can see the force of those arguments but we are in danger of creating an immigration superhighway. Those who argue for this need to say what number they think we can accept under the system. What number in a year or over an average of five years? That is an inconvenient truth that has to be faced but face it we must, and because this Bill is trying to face a number of inconvenient truths it has my support.

Immigration Rules: Statements of Changes

Lord Hodgson of Astley Abbotts Excerpts

Thursday 27th May 2021 Lords Chamber

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, the noble Lord, Lord Green of Deddington, has ploughed a lonely furrow on immigration for many years; not just a lonely furrow but a furrow that many Members of your Lordships’ House think it is quite improper to plough. But outside, in the real world, the issues that lie behind the noble Lord’s prayer and his comments reflect the real concerns of our fellow citizens, as repeated surveys and opinion polls have shown. It is always easiest to run with the crowd and bask in the rumbles of approbation from around your Lordships’ House, but I fear that, from time to time, we have to be prepared to consider inconvenient truths. That is why I am speaking this afternoon in support of the noble Lord.

I have two points to make, the first of which flows from my chairmanship of the Secondary Legislation Scrutiny Committee and picks up some of the points that other noble Lords have made. The Secondary Legislation Scrutiny Committee and our sister committee, the Delegated Powers and Regulatory Reform Committee, under my noble friend Lord Blencathra, have a number of concerns about the way that secondary legislation is being handled, not just here—I am not trying to get at my noble friend on the Front Bench—but generally in the Government. These are skeleton Bills; they are unduly long and complex regulations; and there are inadequate Explanatory Memoranda and impact assessments. And, as the noble Lord, Lord Dubs, said, these regulations introduce changes that should more properly be introduced in primary legislation, with its higher level of scrutiny.

I am also afraid to say that the statutory instruments that the noble Lord has prayed against have a number of deficiencies in them. We have already heard about the length of HC813 and the range of subjects it covers. We have heard about HC1043, and the fact that the guidance was put on the government website only one hour before the regulations came into effect. We can, do and should argue and discuss immigration and its implications, but not many people around your Lordships’ House would disagree that it is an important subject. As has been pointed out by the right reverend Prelate the Bishop of Southwark, five and a half months after these came into effect, we have 90 minutes to discuss them and no chance to make any changes—we are to just wave them away after a 90-minute debate. We can and we should do better than that.

My second and final point is entirely personal. Some Members of your Lordships’ House will be aware of my interest in demography—the study of changes in our population, up or down, and the consequent impacts on the lives of all of us. Last year, I published a pamphlet, kindly referred to by my noble friend Lord Horam, entitled Overcrowded Islands?—the question mark is important. I was very grateful to the noble Lord, Lord Rooker, for giving a plug for the pamphlet at Question Time, on Monday last. I am agnostic about the conclusions, but I argue strongly that we fail to consider the impact of these policies in sufficient depth and over a sufficiently long period into the future. I ask Members of your Lordships’ House not to pigeonhole these remarks as an attack on immigration. I fully recognise that some immigration refreshes and reinvigorates our cultural and economic life, and fulfils some of our moral duties to the world as a whole. But it is about scale and the consequent impact of that scale on the lives of all of us.

The latest ONS projections, adjusted for the pandemic and for Brexit, suggest that by 2040, in the half century since the Blair Government opened up the country to widespread immigration, as referred to by my noble friend Lord Horam, the population will increase by 13 million people, which is just over 20% of the population. Should we be worried about this for ourselves? More importantly, should we be worried about this for those who come after us? We might be worried about risks to our supplies of food and water. We grow only 50% of our food, and the Environment Agency says that by 2035 we shall be running short of water. We might be worried about risks to our ecology; our songbirds have declined by 75% in the last 40 years. We might be worried about risks to our environment; we are currently tarmacking over our countryside at the fastest rate in history. And in our rush to build fast, we are creating identikit housing estates built to low standards, devoid of any vernacular style and, too often, devoid of any sense of community. Do the economic benefits really accrue to us all? Or, as many of us fear, do they accrue to the already better-off and the new arrivals themselves? And good luck to them.

In none of these challenges is population growth the only factor, but it is the most significant factor connecting and linking them all. If the concerns of the noble Lord, Lord Green, are realised—and I sincerely hope they are not—the magnitude of all the above challenges will multiply exponentially. That is why the noble Lord has done the House a single service by tabling this regret Motion today.

Covert Human Intelligence Sources (Criminal Conduct) Bill

Lord Hodgson of Astley Abbotts Excerpts

Committee stage & Committee: 3rd sitting (Hansard) & Committee: 3rd sitting (Hansard): House of Lords
Thursday 3rd December 2020 Lords Chamber

[Lord Judd (Lab) [V]]

My Lords, I shall speak warmly in support of the amendment by the noble Lord, Lord Cormack. It is succinct and brief, and it clearly spells out the issues at stake. He explained why they matter so much. I am also glad to support other amendments that develop that theme with reference to activity in the same sphere.

I am also glad that the importance of the European Convention on Human Rights and our commitment to it is underlined again in this group of amendments. The convention is there to safeguard the future of a stable society. It was written in the context of what we had experienced in that bitter Second World War. People saw that these things mattered for a stable society. It is when the going gets tough and the demands get challenging that our adherence to those principles and to the convention becomes more important than ever.

The noble Lord, Lord Cormack, referred warmly and rightly to the bravery and courage of the many people in the security services. I endorse that totally; I have great admiration for what is being done by much of the security services, for what they have achieved and for the way they have safeguarded people—men, women and children—from unacceptable action. In taking that argument seriously, one of our jobs is to uphold those in the security services, and other services such as the police, who believe fundamentally in being part of a free, liberal society, which they are there only to uphold. It is easy, by not upholding the best and highest principles of those people, to begin to undermine the services. It is corrosive, and we must not let it happen. That is why the amendments are so important. We have in our midst the noble Lord, Lord Paddick, who demonstrates what decent, imaginative and responsible people in that sphere of public service are trying all the time to uphold and demonstrate. I listen always with profound respect to what he has to say.

There is only one other point I want to emphasise. In this unpleasant time in which we live, with so many challenges to our way of life and to what we want to be able take for granted, and with our anxieties about the well-being of our families and so on, we are involved—as I have said before in our debates—in a battle of hearts and minds. I am totally convinced, with all the evidence of recent decades, that terrorism and extremism gain hold and thrive when there is a climate of doubt among a significant number of people and a worry that the state is abusing its power. That is why it is so important that we demonstrate all the time that when we have to take action of the kind the Bill deals with, it is demonstrably justified by what is essential for the well-being of our society. That is why we have talked so much about judicial supervision and so on, which matters in this context. We must not allow ourselves to give ammunition to those who try to manipulate society by building up that climate of doubt and anxiety among ordinary, decent people. These amendments deal with how we approach and win the battle for hearts and minds. We are about a different kind of society.

On that final note, matters such as murder, torture and rape have no place whatever in the kind of society that we claim to be and that we want to protect. That should be a fundamental guiding principle, and that is why I am glad that the noble Lord, Lord Cormack, spelled this out so well. Also, the use of children is unthinkable when so many of them come from vulnerable backgrounds and are vulnerable themselves, and when you consider what we are doing to them as individuals and to their potential to be decent and positive citizens. No, the use of children is not acceptable. I also believe that when we slip into that sort of activity we give ammunition to the people we are determined to defeat. We must not do that. Underlying that principle is not just that it is a tactical necessity—I believe it is a necessity—but that we demonstrate all the time what the values of our society are, and how we are different from these people who want to undermine it and have very little respect for all the things we hold dear.

This is an immensely important group of amendments, and I am glad they are there for our consideration. I plead with the Minister, for whom I have great respect as an individual, to take them as seriously as she should.

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, I have Amendment 45 in this group, which is slipstreaming along behind Amendment 44 tabled in the names of the noble Lords, Lord Rosser, Lord Kennedy of Southwark and Lord Judd, and the noble Baroness, Lady Jones of Moulsecoomb. That is a body of Members of your Lordships’ House that I hold in the highest regard, but not one that I often slipstream along behind, to be honest—but I am glad to do so today. I assure them that my purpose is not to impede their amendment, but just to make clear beyond peradventure that the provisions that they seek apply equally when CHIS operations take place overseas.

The amendment follows from some of the remarks I made at Second Reading, and because, during the debate in Committee a couple of days ago on Amendment 7 —moved by the noble Baroness, Lady Ritchie of Downpatrick—in which I did not take part, the Minister made clear in reply at col. 193 of the Official Report that the Government believed that the ability to operate CHIS and CCAs overseas was essential to the proper operation of the Bill.

This is the first time I have spoken in Committee, and again I want to touch briefly on something else that I said at Second Reading. In picking up here the strictures of my noble friend Lord King of Bridgwater, also picked up on by my noble friend Lord Cormack, of course I understand the duty and importance of the Government keeping us safe, that we send men and women often into danger, and that that may require the undertaking of some actions which might be described at least as being “disagreeable”. But equally I argue—as other noble Lords have done—that in a democratic society there must be a limit to how disagreeable these things can be. That is the balance that other noble Lords referred to, and to which this amendment and others we shall discuss later tonight are directed.

I also need to make it clear that I do not have any legal or operational experience of covert operations. My views are drawn from a number of years serving as an officer of two all-party parliamentary groups—one on drones and the other on extraordinary rendition. I want to make sure that the practices used in those two areas cannot, will not and must not be allowed to morph over into the operation of CCAs overseas.

Let me deal with drones first. Drones obviously provide a long arm for military and other surveillance purposes. It is a somewhat surreal experience to go to an RAF station outside Lincoln, sit in a portakabin set in the corner of a huge hangar created to house Lancaster bombers in the Second World War and watch a pilot flying a drone thousands of miles away in the Middle East. But while it is surreal, it is also deadly serious, because this is the means for carrying out what has sometimes been called extrajudicial killing.

It is not widely known just how extensive these operations have been. In terms of the RAF’s Operation Shader, which covers Iraq and Syria, the MoD tells us that there have been over 8,000 sorties, 4,400 bombs or missiles released, 3,964 enemy fighters killed and 298 wounded—and how many civilians? Just one. That could indicate extraordinarily accurate targeting by the RAF, but the US Defense Department has to reveal to Congress the number of civilian casualties caused by US forces, and in the recent figures sent to Congress they made it clear that they specifically excluded deaths caused by non-US forces, of which there were at least 14. If you press the Government on this area, the answer is that no answers can be forthcoming because of national security. My noble friend will quite rightly say that this is a Bill about covert operations, not drone strikes. I understand that, but I want to be reassured that, down the road, the blanket refusal based on national security will not be available as a response to an inquiry looking into problems with an individual CCA undertaken overseas.

Covert Human Intelligence Sources (Criminal Conduct) Bill

Lord Hodgson of Astley Abbotts Excerpts

2nd reading & 2nd reading (Hansard) & 2nd reading (Hansard): House of Lords
Wednesday 11th November 2020 Lords Chamber

[Lord Hodgson of Astley Abbotts (Con) [V]]

We have had three distinguished maiden speeches this afternoon. First, I welcome my noble friend Lord McLoughlin. The Cardinal Griffin School in Cannock has had a lot of airtime today, but I can tell him that when I visited the school as part of the Peers in Schools programme, there was a large photograph—one might almost say a dominating photograph—in the entrance hall of the school, a fitting tribute to his long and distinguished career in public life. I also congratulate my noble and learned friend on his distinguished opening speech. He reminded us that the underlying purpose of the Bill is to assist in maintaining and building the safety of the citizens of this country: as such, it has my in-principle support. However, it is a support that comes not without limitation: the use of the words “necessary and proportionate” remind us of those limitations.

What are my concerns, which I hope we can explore in Committee? The first is the list of relevant authorities. I share the remarks of several noble Lords about this. I would only add to what has already been said by saying that the greater the number of authorised bodies, some of which may use these powers only rarely, the greater the risk must be of misuse. The second is the extent to which the provisions of the Bill extend outside the United Kingdom. Geographical distance carries its own temptations and dangers, not least in the inevitable limitations on the ability to investigate and follow up fully where matters may have gone astray. My third point concerns what I can best describe as mission creep. I currently chair the Secondary Legislation Scrutiny Committee of your Lordships’ House. Our committee has been increasingly concerned about the use of skeleton Bills, where most of the legislative impact will be achieved through regulation. This is undesirable on many levels, not least because regulations have a lower level of scrutiny because, as is well known in the House, they are unamendable. Parliament is left with the nuclear option of complete rejection, a course which the House is often, understandably, reluctant to take.

As I read the Bill, there are at least three areas where mission creep could take place, but there may well be others. However, as I see it, by regulation the Secretary of State, first, may change the list of the bodies that can give CCAs; secondly, change the basis on which those authorisations can be granted; and, thirdly, change the individuals within the relevant authorities that can give CCAs. All of that is done by regulation. It seems that, taken together, these powers could quite radically shift the basis on which the Bill is constructed and on which it will operate.

My final point concerns the investigation of cases where matters have not developed as hoped and expected, and here I take up the points raised by the noble Lords, Lord Carlile of Berriew and Lord Anderson. I note the additional remit of the Investigatory Powers Commissioner, and of course those powers are welcome, but I see nothing about urgency. Speed of innovation is critical to achieving a proper outcome before waters, which may well sometimes be deliberately muddied, close over the case. I have been an officer of the All-Party Group on Extraordinary Rendition for many years, and the group has watched as successive Governments—no party has clean hands on this—have ducked and dived. We have to make sure that these sorts of cases cannot arise with this Bill, although it has my in-principle support.

Immigration and Social Security Co-ordination (EU Withdrawal) Bill

Lord Hodgson of Astley Abbotts Excerpts

Report stage & Report stage (Hansard): House of Lords & Report: 1st sitting & Report: 1st sitting: House of Lords
Wednesday 30th September 2020 Lords Chamber

[Lord Green of Deddington (CB) [V]]

My Lords, I am glad to support this useful and well-timed amendment proposed by the noble Baroness, Lady Neville-Rolfe. As she has so clearly described, enforcement has long been one of the weakest points in our immigration system. Despite that, it has faced an 11% real-terms reduction in its budget since 2015-16. The Home Office says that it

“continually looks for ways to reduce costs, so as to improve efficiency and deliver better value … for taxpayers.”

However, as the noble Baroness mentioned, since our Committee stage the Public Accounts Committee has published its report on immigration enforcement. It pointed out that the returns of those who have no right to be in the UK are “plummeting”. The report also criticises the Home Office for having provided the public with no information at all about the scale of illegal immigration for 15 years and points out that the Home Office

“failed to complete 62% of the returns it planned from immigration detention in 2019, compared to 56% in 2018.”

This may of course reflect the ever more strident behaviour of the legal arm of the immigration lobby, some of whom use late and sometimes spurious asylum claims to frustrate removals. Nevertheless, the performance of the Home Office can hardly be described as “better value for money”. Recent official statistics reveal that the number of failed asylum seekers who are subject to removal has doubled from 20,000 in 2014 to over 40,000 now. Clearly, more resources must be diverted to the task of removal, and those resources must be more efficiently targeted and implemented with determination.

Let me also make this point: it is important that the officials themselves should feel supported by the public, as indeed they are. We should avoid constant negative criticism—I hope that I have not done too much of it—as these officials are carrying out an important and difficult task. They need and deserve to be affirmed. After all, they are following due process and enforcing the rule of law, thus making an important contribution to the order that we cherish as part of our civil society. A report to Parliament on enforcement following up on the PAC report, as proposed in this amendment, would be a valuable next step.

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, I have put my name to Amendment 1, which represents an important piece in the jigsaw of our new immigration system. We have just heard two very hard-hitting and detailed speeches from my noble friend Lady Neville-Rolfe and the noble Lord, Lord Green, about the vital role that enforcement plays and why it is so important that we check it is working effectively. In my few minutes, I want to focus on two aspects: transparency, to which the noble Lord has referred, and in particular fairness. The British public have a great interest in situations being fair, but both aspects will be needed in any enforcement regime that is to command public confidence over the longer term.

First, the present system is not fair to those people who try to come to the country legally. It cannot be right for other people to try to jump the queue with virtual impunity and at their expense. Good behaviour should have a proper reward. Secondly, it is not fair to the people who come here—these new arrivals—who will likely find themselves forced to work for below-standard wages in substandard accommodation, without any of the protections of the British state. It is modern slavery indeed. Thirdly, it is not fair to the British taxpayer who inevitably, in one way or another, usually hidden, has to foot the bill. Finally and most importantly, it is not fair to the members of our settled minority communities. Most but not all of the overstayers will be drawn from the races who make up our minority communities. Those members of our settled population, legally resident here and drawn from minority communities, are working hard to make a new life for themselves—and good luck to them. But they find their collective reputation damaged and undermined by a regime where many people are able to say that the system is not working and that they are somehow to blame.

How large is the problem? As is so often the case in this area, the data is imperfect. My noble friend Lady Neville-Rolfe referred to that fact. I have not been able to find any Home Office assessment of the overall problem since 2005, which would now be very much out of date. However, the Pew Research Center, a well-regarded authority, suggested last year that there may be 1.2 million unauthorised migrants in the country, or about 2% of our population. Noble Lords may point out that those are figures from the world at large, but there are some statistics from the EU. As of 31 March 2020—six months ago—the Home Office reported that 171,000 Bulgarian citizens and 564,000 Romanian citizens had sought settled or pre-settled status in this country. However, other Home Office figures showed that, as of 30 June 2019, nine months earlier, there were supposed to be only 109,000 Bulgarians and 457,000 Romanians officially resident in the country. That is an underreporting of 168,000 from those two countries alone, which of course form part of the EU.

--- Later in debate ---

[Lord Naseby (Con)]

My Lords, I hope the Government will listen to the noble Lord, Lord Green, who has been very persuasive over a great many years. He does his homework and is well worth listening to.

Context is the key issue. It does not take a genius to work out that we will probably have higher unemployment in the next two years than anyone in this House has ever experienced. Against that background, the driving force must be how we get our people back into work. That must be the number one priority.

I had the privilege, with my noble friend Lord Horam, of reading economics at St Catharine’s College, Cambridge. We were taught in some depth about Keynesian economics. Keynes came to the fore between the wars, with the unemployment situation. It was his driving force that produced the system whereby the public sector produced public sector works and employed the unemployed. That must be the driving force for the next two years.

There will be sections of society where we need immigration. Two come to mind: we always seem to be short of qualified doctors and we are clearly short of lab technicians, otherwise the testing and the analysis of it might be working together instead of one behind the other. Sections of our economy will need immigration, but it is not beyond the worlds of all of us to sit down and work out where that should happen.

I am pleased the Minister has made a statement today having consulted business—somewhat in contrast to Mr Gove and the haulage industry. Nevertheless—although I have not seen the whole speech—if he is talking to business, that is good.

We need more control. I do not know what the right figure is, but it is 100,000 or under. Our Government should look at that hard and in the context of where we really need some help because we sadly cannot use our unemployed.

I finish with basically the same sentence as I finished up with on the Agriculture Bill: we need to produce more home food. To do that, we need people to work in the fields, bring in the harvests, pick the apples, dig up the leeks, whatever it may be. If there are not enough people among the unemployed in Britain prepared to do that, we jolly well have to take it on the chin and bring in people to do it.

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, I was very sorry not to be able to be here for the debates in Committee on these amendments, to which I put my name. I had an unavoidable business commitment elsewhere. I apologise to the House; I took the trouble to read Hansard carefully.

I support the amendment of the noble Lord, Lord Green. We need a limit on the annual numbers from the EEA and Switzerland seeking employment. The noble Baroness, Lady Jones of Moulsecoomb, said we should stop talking about it and just get on with it. She is right in a way, because a cap is inflexible and clumsy, but I have come to the conclusion—somewhat reluctantly—that it is inevitable and the only way we will be able to grasp the challenges that the number of arrivals in this country now poses.

Simply put, without a cap the Government will never get control of this issue. The noble Baroness, Lady Smith of Newnham, who I am glad to see is still in her place, asked why we think this. History, particularly recent history, has shown how extraordinarily difficult it is to grasp this problem. We have heard a lot about taking back control, but the awful fact is that, where we have no control over current arrivals—those from the EEA—arrivals are falling, but where we have always had control, they are rising sharply. In 2016, there were 133,000 arrivals from the EU; now there are 58,000, in the figures produced by the ONS a few weeks ago. Meanwhile, the non-EU arrivals were 175,000 and are now 316,000—nearly double.

I sat in this Chamber for many hours, hearing all those noble Lords saying that Brexit was going to chase everybody away and no one would come here because we would all be anti-foreigner. I can tell the House that in 2016, 308,000 people arrived here, and the latest figures say that 374,000 have arrived, so that is not a sign that people are being frightened away. Nor is it about no immigration. It is about scale—about 374,000 people. It is about 900 a day and all that means. I will not go through the things other noble Lords talked about, such as houses and the impact. We have 6 million more people in this country, and that is with drastically reduced levels from where we are today. If we go on at the current level, it will be 8 or 9 million more. At 6 million more people, we will build over an area the size of Bedfordshire by 2040. No ifs, no buts, no maybes—that will happen. We will almost certainly be unable to stop it, because you always look 10 or 15 years out when you do demographic planning. We need to be honest and clear about the implications of the decisions that we take in Bills and statutes like this.

How has this happened? At root, it is because it is in employers’ commercial interest to recruit trained but cheaper labour from overseas. Why go to the trouble and the expense of training members of a settled population, many of whom may be quite recalcitrant and not particularly grateful, when you can avoid all that effort by recruiting someone from overseas, who is probably jolly grateful? British industry and commerce have become addicted to overseas recruitment at the expense of our own people. Figures bear that out. My noble friend Lord Horam referred to the think tank Onward. Last year it reported:

“Since 2011 employer spending per trainee has fallen by 17% in real terms”.


Employers have avoided having to put money into training; they have been able to go overseas instead.

In researching the pamphlet I recently published, I investigated the engineering industry, another sector where employers are always bemoaning the lack of UK-grown engineers. I was absolutely astonished to learn that last year, six months after graduation, fewer than half the engineering graduates of this country were working in engineering. I understand that they are not all going to go into engineering, but fewer than half is a surprisingly small number. When I went to talk to some of these young men and women about why they had not moved into engineering, they said that one of the problems is that UK employers preferred to offer jobs to someone with experience—no surprise there. UK undergraduates find themselves in a position where they cannot get experience without a job, and they cannot get a job without experience.

My noble friend will no doubt point to the Migration Advisory Committee, which has been the subject of a number of our conversations this afternoon, and its enlarged remit. The MAC is a fine body of men and women, but even a cursory reading of its annual report shows the enormous pressure that it is under to effectively abandon all controls. To quote from page 81 of last year’s annual report: “The majority of respondents”—that is, employers sending information to the MAC—

“agreed that there should not be a salary threshold above the National Minimum Wage”.

Secondly:

“There was stronger support for the idea of a salary threshold that was in some way variable to reflect employer needs”.


That effectively means nothing. On page one of the report, the MAC pointed out that this was the inevitable conclusion of “an employer-driven system”.

My noble friend on the Front Bench is a redoubtable Minister, as is the Home Secretary. No doubt there are many redoubtable Ministers in the Government, but they will find themselves under irresistible pressure, carefully argued by employers, about the inability of the UK to compete on a world stage unless more arrivals are permitted. Under that pressure, Ministers will first buckle and finally break. As other noble Lords have pointed out, the full effect of the pandemic has yet to make itself felt. Surely none of us seeks to argue that the consequences for the employment of our settled population will be anything other than lessened. Against that background, allowing annual immigration of 374,000 a year—1,025 a day—must be ill-advised and maybe runs the risk of societal disorder. That is why a cap—clumsy, yes; inflexible, yes—set annually, debated and approved in Parliament, is critical. That is why I support the amendment of the noble Lord, Lord Green.

[Lord Paddick (LD)]

My Lords, the Bill is about ending the free movement of people from the EU and EEA, and Swiss nationals. The noble Lord, Lord Green of Deddington, and other noble Lords oppose the proposed points-based immigration system that relies on measures other than a cap on numbers to control immigration to the UK. As my noble friend Lady Smith of Newnham said, on 1 January at the end of the transition period, the rights of EU citizens to come and work in the UK will be replaced by controls based on salary and skill levels. That will also apply to migrants from the rest of the world. The number of EU migrants has already fallen significantly, and will continue to do so, as a result of the end of free movement that the Bill brings about. While we on these Benches regret that, it is the consequence of leaving the EU. That is what the UK people voted for; we have already left and will suffer the consequences.

I shall engage to some extent with some of the issues that the noble Lord, Lord Green of Deddington, raised and come back to them on future amendments. He said that the system was entirely for the benefit of business and not of British workers, would cost between 6 million and 7 million jobs, and that there were hundreds of millions of people potentially qualified to come to the UK to take those jobs. He said that the public were in favour of control. However, my understanding is that there will be control but of a different type from setting a cap. Presumably, although the Minister will enlighten us, salary levels and qualification requirements can and will be varied if necessary if consequently we suddenly face a so-called avalanche of people coming to the UK from areas other than the European Union. Any avalanche from the European Union would have happened already because, at the moment, there is free movement.

It is interesting that noble Lords opposite talk about business interests, yet in other debates they argue that we need a strong economy to pay for public services. The fact is that migrants, particularly migrant workers, contribute far more to public services than they receive in public services, and they certainly contribute more than the average UK resident does.

We on these Benches believe that government departments such as the Department for Business, Energy and Industrial Strategy and the Department of Health and Social Care have knowledge of the migrants that the UK economy needs, and that they, not the Home Office, should decide on immigration policy, points-based or otherwise. I will not entirely do the Minister’s job for her but perhaps she can convince the noble Lord, Lord Green of Deddington, that his amendment is not necessary because the points-based system will effectively reduce immigration.

--- Later in debate ---

[Lord Horam (Con)]

This is about the resident labour market test and I find it quite astonishing, like my noble friends who have spoken to the amendment, that this should be removed at the point when we are entering a period of huge unemployment, as predicted by the Chancellor in his Statement only a few days ago. It is completely astonishing that that should be the case at the moment.

It is also amazing that the noble Lord, Lord Kennedy, has so far not supported such an amendment: it beggars belief, frankly, that the Labour Party spokesman is willing to give this up in such circumstances. I hate to attack—rather, argue—with the noble Lord but he did take me on in our last debate. I will not take long over this but he did ask, “Who is this think tank, Onward?” It is a perfectly reputable, charitable think tank. The point it was making, as am I, is that Australia has had a cap on immigration for years. We have imported half the Australian points-based system but are refusing to import the rest, which is the cap. They say in Australia, “no cap, no control”, and that is why they have a cap.

It is the same in Canada, where they have the same system and it is debated in Parliament. It is all perfectly transparent and its Parliament has a role. It is the same in New Zealand. The noble Lord, Lord Kennedy, also said that he was worried about the economy, but Australia and Canada have successful economies and caps on immigration; New Zealand has a successful economy. They are all rather more successful than we are, in many respects. I advise the noble Lord, as a true friend—we served together on the Electoral Commission and I really appreciate him as a stalwart Labour man—to think again about this and reposition his party. Believe you me, if the Labour Party does not reposition itself on immigration, I can tell him, it is in real trouble.

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, I support this amendment, as the House would expect, but before I get there, the noble Lord, Lord Kennedy, threw down a challenge and I had better get to that first. I am pleased to be able to tell him that I paid for every single bit of that pamphlet. Every single envelope, stamp, and bit of printing was paid for by me and I am happy to share the receipts and information with him if he wishes. The only time that I used any of the facilities of the House was to distribute the pamphlet, a copy of which went to every Member of your Lordships’ House and every Member of the House of Commons.

I support the remarks of the noble Lord, Lord Green, and my noble friends Lady Neville-Rolfe and Lord Horam. I do not want to go over all that again now. In my remarks on Amendment 6, which we have just dealt with, I explained how employers have become addicted to cheap labour from overseas because it is in their commercial interests to do so. As a result, we have become thoughtless and careless about the employment opportunities for our settled population. We have young people locked into zero-hours contracts. We have members of minority communities locked into low-paid, low-prospect jobs. Increasingly, and really seriously because they are a larger part of our population, the over-50s find it hard to get jobs even as we raise the retirement age. A 2018 House of Commons report revealed that 1 million people over 50 would like to work or work more; 14% of 50 year-olds are out of work and 35% of 60 year-olds are out of work. Removing the resident labour market test opens them up to an even greater degree of unemployment risk.

As many noble Lords have said, as the impact of the pandemic makes itself felt, all these problems will get worse. How do we protect and look after our settled population in these circumstances, particularly since these same economic pressures will make employers ever keener to game the system and access cheaper labour from overseas? The first line of protection would have been a cap but we are not going to have it because my noble friend the Minister has told us so. This amendment is a second line of protection, as explained by the noble Lord, Lord Green of Deddington, since the resident labour market test prevents the grosser excesses of undercutting wages by recruiting from overseas.

I apologise to the House for not having been present in Committee, but I have read the debates and, following a point made by my noble friend Lord Horam, I was really astonished by a comment made by the noble Lord, Lord Rosser, at col. 843 of Hansard, about the trade unions. Why every union at the Trades Union Congress is not down here supporting this amendment as a way of helping and protecting the working man they seek to represent, absolutely astonishes me. Now, that is for the party opposite to sort out.

The strains that our society will face do not just come from the pandemic. They will come also from the impact of the fourth industrial revolution—from artificial intelligence and robotics, not often mentioned in our debate so far. In those circumstances, policies that will likely result in close to 1,200 people arriving on an average day cannot be sensible.

A key determinant of a person’s self-confidence and sense of self-worth is, undoubtedly, purposeful and secure work. Professor David Blanchflower said in his book Not Working, published last year:

“Unemployment hurts and it hurts a lot.”


The amendment, if the Government accepted it, would help reduce but, sadly, not eliminate that level of hurt, which is why I support it.

[Lord Paddick (LD)]

My Lords, I begin to wonder whether we should swap Benches at this stage. Again, the noble Lord, Lord Green of Deddington, longs for the old immigration regime that he has criticised so much. This time it is the resident labour market test or, as the former leader of the Labour Party, Gordon Brown, may have put it, “British jobs for British workers”.

The noble Baroness, Lady Neville-Rolfe, posited that UK employers were likely to recruit from overseas without even considering UK workers, and the noble Lord, Lord Hodgson of Astley Abbotts, said that UK employers were addicted to using imported, low-wage labour. I thought that under the points-based system there was a minimum salary of £25,600, which does not sound to me like undercutting UK labour.

Surely, British employers will look to avoid the immigration skills charge by hiring a UK resident in preference to a migrant, if they possibly can, and British employers will look to avoid having to pay a licence fee to be an authorised sponsor of migrant workers, if they possibly can. Migrants will be deterred from working in the UK, including in the National Health Service and social care, because they will have to pay the immigration health surcharge in addition to income tax, national insurance and VAT—effectively, having to pay twice for the National Health Service. Migrants will also be deterred from working in the UK because they will have to pay far more than the cost price of a visa, and because of the salary and skill levels they will have to attain to secure enough points to get a visa in the first place. From 1 January, all that will apply to all new migrants from the European Union as well as those from the rest of the world. Therefore, I do not think that the noble Lord’s amendment is necessary and we do not support it.

--- Later in debate ---

[Lord Horam (Con)]

The contributions to this debate are getting shorter and shorter, and I intend to adhere to that pattern. The simple point I want to make is that this is part of a loosening of the arrangements—I would not call them controls—which were put in place at the beginning of this year and then amplified in July. Of course, since then we have had the coronavirus pandemic. We have the prospect now of an additional two million unemployed, and young people coming into the job market face a very bleak situation. These are not normal times.

The Treasury has responded rapidly and comprehensively to this situation with a major package earlier in the year and the less pronounced package of the last 10 days. What I hope and expect is that the Home Office reacts similarly and recalibrates the ideas it had before the world changed when the coronavirus set in. We really do need it to respond. I do not believe that the Home Office is unfit for purpose, as was once said by a Labour Minister. It has many able civil servants who are perfectly capable of responding to a changing situation, but they need to show it now; otherwise, people will lose faith in the Government.

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, one of the weaknesses of the whole Bill is the extent to which the detailed implications are contained in regulations which are only now beginning to emerge. Every Member of your Lordships’ House will be aware that the scrutiny of regulations is much less effective than that of primary legislation; the noble Lord, Lord Pannick, raised that issue in the debate on one of the previous amendments. I should perhaps, just for the record, declare that I am the chairman of the Secondary Legislation Scrutiny Committee, but I am speaking for myself, not for the committee.

As the noble Lord, Lord Pannick, said, the regulations are unamendable, so the House is left with what I call the “nuclear option” of complete rejection. Unsurprisingly, the House has veered away from that course of action, except on the rarest of occasions. That is one of the reasons why I support the noble Lord, Lord Green, in this case, because he is actually trying to wrest back a bit of control by having some more specific plans built into the Bill. They are necessary for the reasons that he, and indeed my noble friend Lady Neville-Rolfe, laid out. In its way, this amendment is the third and last line of protection in regulating the extent to which the employment opportunities of our settled population can be undermined.

We already know that there is no cap and that we will have no resident labour market test. Therefore, if my noble friend the Minister refuses to accept this amendment—and I fear that if I could glance over her shoulder at her speaking notes, I would see that she might just be going to do that—it is extremely likely that our future levels of immigration will continue, probably in excess of a quarter of a million each year. It may be slightly below what we have now, at 320,000, but it will be well over a quarter of a million each year.

In Committee I chided the noble Lord, Lord Kennedy, who has been coming back at me this afternoon, when he refused to back my proposal to establish an office for demographic change, which was a planned idea, independent and transparent, to look at the complexities of these issues in the round—environmental, ecological, societal. It is easy to laugh—the noble Lord is already grinning—but the reality is that there are serious issues around water, land quality and species loss which are all related to how our population is growing. They are not entirely due to it, but they are very largely related.

I said to the noble Lord, I hope, gently, because I do not want to upset him—he is a sensitive soul—that his party had to decide where it stood on demographic growth, of which immigration is a part, because it is an issue that really resonates in the country. We have heard the percentages; 60% to 70% of people are concerned about it. In particular, his party must decide where it stands, or all the possibilities of recovering the red wall, now blue wall, seats will be vanishingly small.

However, it is perfectly fair to say that this is not without dangers for my party. We will face quite significant challenges. If those of us who are concerned about what happens if our population grows by 6 million or 8 million are right, and the package of policies before us continues to allow rapid growth—it is not about whether they are foreigners, black or white, or what their colour is; it is about the number of people—we will have two big challenges. First, a lot of the people who turned the red wall seats into blue wall seats did so because we promised a sustained reduction in the level of immigration. If we do not deliver that, they will feel betrayed and let down.

In parallel with that, every year we will have to build 100,000 houses to accommodate the quarter of a million people likely to arrive. The noble Lord, Lord Paddick, says that they pay more in tax than they draw in benefits, but there is a much more complicated issue, with which I will not bore the House this evening, about the capital investment to maintain and extend our roads and structures. They are not covered just by taxes; a much bigger level of capital expenditure is required. He and I can discuss this over a socially distanced cup of coffee, but I will not bore the House with it now.

We will build 100,000 houses a year, and they will be built in our shire counties. These people will not be delighted about it. We know that; housebuilding is intensely unpopular. The coming storm about the planning algorithm, which is now doing the rounds, is just the beginnings of the trouble there will be if we continue down this road. My noble friends Lord Horam and Lady Neville-Rolfe are right. The Government are wrong in believing they have the situation under control.

My noble friend the Minister nobly and loyally marches to the beat of the Home Office drum, which essentially says, “Don’t worry; it will be all right on the night”. I wish I shared the department’s confidence.

[Lord Paddick (LD)]

My Lords, my understanding is that what lies behind this amendment is the aim to allow Parliament to set a rate for new entrants instead of it being set at 30% lower than the national average going rate of £25,600 under the points-based system. To restate what I have said before, this Bill is about EU migration, on which there is no restriction at the moment. From 1 January, if this Bill becomes law, there will be restrictions on EU migrants and a salary floor for new entrants.

It seems that the gut reaction of the noble Lord, Lord Green of Deddington, to the new entrant salary level being set independently based on economic research by the Migration Advisory Committee at £20,480 is that it is a bit low. But as the Minister explained in Committee, the MAC found that those starting in their careers were typically being paid 30% less than those who were established in their role; hence the floor for new entrants is 30% less than the £25,600 set as the salary floor for migrants under the new points-based system. I am not sure whether the noble Lord, Lord Green of Deddington, is arguing that £25,600 is too low and therefore the new entrant salary level is too low, or whether 30% less for new entrants is not typical of a new entrant and therefore it should be something other than 30% less than the established rate.

If the noble Lord’s amendment is agreed, I would have to ask him on what basis he thinks Parliament should decide the new entrant salary level. I understand that the noble Lord believes that migration decisions should be based not on economics but on politics. May I say that I deny that I care little for ordinary working people, as the noble Lord said? If he would care to read in Hansard what I actually said, he will see that I felt that there were alternative protections for ordinary working people to what he was suggesting, which is completely different

We on these Benches believe that economic migration should be based on economics, while immigration by asylum seekers should be based on the compassionate consideration of the evidence of their claim. On that basis, we cannot support the noble Lord’s amendment.

Immigration and Social Security Co-ordination (EU Withdrawal) Bill

Lord Hodgson of Astley Abbotts Excerpts

Committee stage & Committee: 4th sitting (Hansard) & Committee: 4th sitting (Hansard): House of Lords
Wednesday 16th September 2020 Lords Chamber

Moved by

[Lord Hodgson of Astley Abbotts]

77: After Clause 4, insert the following new Clause—
“Charter for EU Immigration and Demographic Change
(1) The Secretary of State must prepare a document, to be known as the Charter for EU Immigration and Demographic Change, explaining the formulation of the policies of Her Majesty’s Government relating to immigration from the European Union.(2) The Charter must, in particular, set out—(a) the Government’s demographic objectives in relation to such immigration, and(b) the means by which such objectives will be attained.(3) The Government must lay the Charter before Parliament within one year of the commencement of this Act.”

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, I will also speak to Amendment 78, which forms part of this group. I do not often quote Lenin, but he is supposed to have said, “There are decades where nothing happens; and there are weeks where decades happen.” Our present era is one of the latter. It presents challenges and opportunities to the people in this country and across the world, and a challenge for Governments in managing these changes in a way that enhances our overall quality of life while balancing the inevitable tension between preservation and progress. However, politicians of all persuasions find it hard to address these mega-issues, which have a 10, 20 or even 30-year timescale. Inevitably, and quite properly, they have their eyes fixed on the five-year electoral cycle. Given this, it is perhaps unsurprising that, for many politicians, the long grass is an effective way out.

Many Members of your Lordships’ House will be aware of my long-standing interest in demography and the impact of demographic change. The results of increases or decreases in population—I am glad to see the noble Baroness, Lady Ludford, in her place, because she referred to the dangers of decreases in her speech when I was not here last Wednesday; she was quite right about that—are inexorable in their effect and are of extreme importance to the settled population of this country. When I refer to the “settled population” I mean every person legally entitled to be in this country, irrespective of race, colour or creed, or whether they have lived here for five months or 500 years. The views of the settled population on the issue of population growth could not be clearer. Recent polling found that 64% of us think that the UK is too crowded and 74% felt that the Government should have policies to address this challenge.

Nevertheless, there remains an influential minority, particularly among the commentariat, who agree that this is all too difficult and what will be will be. On the right, the argument is that the market will decide. On the left, the brotherhood of man means that we should keep our arms and our borders open. However, I am afraid that these arguments would not be supported by the overwhelming majority of this country. For many, a perpetually growing population in a relatively small island has not obviously resulted in an improvement in their prosperity or their way of life.

A couple of figures help set the matter in context. In the late 1990s, when the Blair Government decided to encourage large-scale immigration, the population of the United Kingdom was 58.1 million. Today, it is 66.4 million—an increase of more than 8 million. The ONS mid-projection for 25 years from now is 72 million —another 6 million increase. Therefore, over half a century our population will have increased 14 million, or 24%—a particularly significant figure in a country with some very densely populated regions.

Even reciting these figures gives critics the chance to allege a little Englander mentality, with machine guns on the white cliffs of Dover. That is not so: I absolutely recognise that new arrivals bring an economic and cultural dynamic from which our society has benefited greatly. This is an argument about scale, the wider impact of population growth and responding to the concerns of the people of this country in a way that builds trust in government.

Most of the arguments in favour of the demographic policies followed to date have been economic ones. Total GDP is often waved about by politicians as some sort of totemic symbol of success. Like many, I find that argument unappealing. GDP per head would surely be a more accurate measurement, and since economic gains are often not fairly shared, median GDP per head would be even better. We can argue about these and many other economic factors and we have done so at great length in this House over the years. What is unarguable is that no one is weighing in the scale the long-term non-economic challenges for our environment, our ecology and our society.

According to the latest ONS figures, released a couple of weeks ago, our population is currently growing by an average of 1,172 per day—428,000 per year. We live 2.3 people per dwelling. So on that metric, the inevitable maths show that we need to build 509 dwellings every day, 21 an hour, one every three minutes. By 2040, we seem likely to have built over an area the size of Bedfordshire—this after a decade in which Danny Dorling, professor of geography at Oxford University, has said:

“In absolute terms this is very likely to be the largest increase in the number of square miles that have been tarmacked or paved over in any decade in British history”.

--- Later in debate ---

[The Deputy Chairman of Committees (Baroness McIntosh of Hudnall) (Lab)]

My Lords, I have received no further requests to speak after the Minister, so I call the noble Lord, Lord Hodgson of Astley Abbotts.

[Lord Hodgson of Astley Abbotts (Con)]

I thank all who participated in this debate. This was the first time we have taken the car out on the track and I think we got around without a wheel coming off. I am particularly grateful to my noble friends Lord Horam and Lady Neville-Rolfe on the economics, the importance of productivity and the problem of crowding out and to the noble Baroness, Lady Greengross. When I was preparing my pamphlet, I went to see a captain of industry about employing older people. He said “Of course, we are very keen to employ older people”, and I said “Well, let us look at your human resources booklet”. It did not have a person over 30 in it. The way our society looks at people is unfair.

Of course, the noble Lord, Lord Green, has forgotten more about immigration than I will ever know. To the noble Baroness, Lady Bennett, I say—without wishing to flog my pamphlet—that there is a map of the ecological footprint of London in it, on which you can see the numbers she referred to. I thought I got half— no, a quarter—of a loaf out of the noble Baroness, Lady Ludford. It was a principled refusal but the car needed a bit of tinkering to get her to come onside.

To the noble Lord, Lord Kennedy, I say that we had a classic knockabout. We were all biffed about. I will make one serious point, which is meant to be gentle. If the Labour Party does not get its act together and its policy clear on the issues of people coming to this country, it will not regain the red-wall seats that went blue. People outside the M25 feel passionately about this. How you tackle it is up to his party but just saying “Never mind; it will all be alright” does not, to be honest, sound like a good political strategy.

Immigration and Social Security Co-ordination (EU Withdrawal) Bill

Lord Hodgson of Astley Abbotts Excerpts

Committee stage & Committee: 1st sitting (Hansard) & Committee: 1st sitting (Hansard): House of Lords
Monday 7th September 2020 Lords Chamber

[Lord Blunkett (Lab)]

My Lords, I rise to support my noble friend Lord Hunt’s amendment and the brief, excellent speech he made at the beginning of this debate. I also want to reinforce points that have been made by the majority of your Lordships, with the exceptions of the noble Lords, Lord Lilley and Lord Green. Although I do not dispute for a minute that both noble Lords have a point, they have highlighted what I hope to put across this evening, which is the complete contradictions that exist in this debate.

I shall start by picking up those points made by the noble Lords, Lord Lilley and Lord Green. I am presuming that, when we reach Report, they will be moving amendments that will remove the so-called health and social care route announced in July, because under that route doctors and nurses could be recruited from across the world to fill vacancies at that level.

One of the contradictions that I want to highlight relates to young people. Young people who cannot find a job anywhere else due to the aftermath of Covid-19—the 20% drop in GDP and the knock-on effect on unemployment—might decide to go into social care. Most young people I speak to want a career and to be able to progress, and there is progression in both residential and social care. However, as things stand with the proposals by the Government, the area from which we would allow people to be brought in from overseas would be at that higher level, whereas at the lower level the vacancies that have been mentioned—122,000 in England alone—would not be fillable from outside the country. I do not know whether the Government believe that, given the crisis in unemployment that is about to accelerate, people will just take up those vacancies even if they are not emotionally and physically suitable to take up caring duties. As has been made clear in this debate, you have to be a particular type of person to take up some of the less attractive duties of caring for someone who is severely disabled or frail and has dementia.

The contradictions, also mentioned by the noble Baroness, Lady Barker, abound. We all want to see improved wages in this sector. That would not only reward people morally for what they do but help fill vacancies. But the danger of simply putting money into the sector, given the level of private equity ownership, might well be that it gets creamed off, rather than helping to fill vacancies. Or, they will simply close the homes if the money is not provided, which will cause an even bigger problem—as part of the contradictions, we would end up with older, frailer and more severely disabled people in hospital settings, which are more expensive but would allow for staffing to be brought in from outside this country. We saw that in March and April, when people who should have been in different settings in the first place were cascaded out into the residential sector unchecked for Covid-19 and ill-prepared in terms of PPE to be able to deal with it. The consequences, as the noble Lord, Lord Patel, said, are obvious for all of us to see.

The biggest contradiction of all—and I put this to the noble Lords, Lord Lilley and Lord Green—is that, on the centre-left in politics, people are generally suspicious of markets and, on the right, people generally embrace markets. But as I said on Second Reading, in the case of the labour market, the situation is reversed, and those who believe vehemently in markets are against a labour market and against being able to draw in from across the world those who have something to offer the area we are talking about this evening.

We need to sort out the contradictions. That includes the issue of austerity, which led to a bigger downturn in funding for local government services and those funded by local government than any other public service area in the country, with the result that local government has been struggling both with its own direct health provision and with funding in the market and the ability to sustain services.

I have one question—I have learned over the Covid-19 period that you do not get an answer from the Minister unless you ask them a question. My question is simple, and the Minister might be able to answer it tonight: we know what the vacancy level is, but do we have an up-to-date picture of the turnover level in the social care sector? The turnover gives you an idea of how long people can stand working in this challenging but often rewarding setting. What steps might have to be taken if the Government’s hope is that the downward pressure on job availability will help fill, in the short term, the vacancies that we have talked about?

At the end of the day, what we are talking about is the care of human beings. We are not talking about markets or political or economic theory; we are talking about the reality of caring for people in their own homes and stopping them, therefore, having to move into hospital, residential care or residential settings that are dealing with people at very difficult times of their lives. In the end, we have to care enough to get it right.

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, I listened carefully to the powerful opening speech from the noble Lord, Lord Hunt of Kings Heath, who is very experienced in this field, and to the speeches that have followed.

Who can argue about the need for a properly skilled, staffed, trained social care workforce? “Skilled and settled”, I think, was the phrase used by the noble Baroness, Lady Masham of Ilton. That is why the issues in subsections (3)(a), (3)(b), (3)(c) and (3)(d) in the noble Lord’s proposed new clause seem entirely appropriate questions to ask. But when they are tied back into an immigration Bill, I begin to get nervous. The noble Lord, Lord Blunkett, talked about contradictions, and I listened carefully to what he said, but the fact is that the issues in subsections (3)(a) to (d) are issues for the sector not linked directly to the immigration matter we are discussing this evening.

I recognise I am probably swimming against the tide, but it is important to realise that workplace psychologists will tell you that you go to work for three reasons. First, you go for the money, and let us not be precious about that. Secondly, and equally importantly, you go for what they call self-actualisation —to improve and increase your life skills, work with decent people, have career progression, have a good performance that is noted and rewarded and, hopefully, operate in an atmosphere of good team spirit. Those are the internal desires most people have in going to work.

The third area is external reputation. When you mention where you work, what do people say in the saloon bar of The Dog and Duck or around the table at a dinner party?

It is worth taking those three yardsticks and applying them to the social care sector. First, there is the money. There is no getting around it: £8.70 an hour is clearly not good enough when compared with £9 for stacking shelves in a supermarket. However, money is not the only motivator here, and when we turn to self-actualisation —the second of the criteria that I mentioned—the situation is quite serious. I have had the privilege of serving on the boards of many companies in my career. When I join one, I often say, “Tell me about your staff turnover.” No staff turnover is not an attractive thing; very often it means that the company has got a bit complacent and is not at the cutting edge, and that the service is not as good as it could be. You want some staff turnover—5%, 10%, that sort of level—to provide the dynamic but, if it rises above that level, it is operationally destructive, distracting and expensive, and the quality of the service starts to fall away.

I understand that in 2018-19 there was a 32.2% turnover in directly employed staff in the sector. Worse, among care workers the turnover was 39.5%. Further evidence of a lack of considered career progression is that half the workforce—excluding registered professionals —have no relevant social care qualifications, which seems to me a question not of money but of managerial grip and organisation, and of making the sector better managed.

Lastly, on the external reputation, one of the great advantages and developments of the pandemic is that people have begun to see how useful, worthwhile and attractive social care can be. People have begun to think about it. Long may that continue but, historically, we all must accept that its reputation has not been that good.

This is a system under acute stress, as many noble Lords have said. The danger of amendments such as these is that they will result in new arrivals, and that immigration will be used as a crutch to maintain what is close to being a broken system. I cannot believe that this is the right approach. More importantly, if the sector believes that it has a “get out of jail free” card, to use the inference that the Minister made when winding up at Second Reading, then there is no pressure on the sector to make any improvements or changes to how the businesses are run or operated, nor indeed is there any pressure on the Government to do likewise. We must find ways to improve the operational performance and the financial performance.

I have two final points. First, on the issue of morality, referred to by my noble friend Lord Lilley, the noble Baronesses, Lady Barker and Lady Meacher, and the noble Lord, Lord Patel, recruitment in this area is a zero-sum game. What we have, other people lose. Maybe one could say that within the EU there is sufficient prosperity for us not to worry about it, but the noble Lord, Lord Patel, mentioned the wider recruitment. This is a very serious issue. We must look ourselves in the mirror and decide whether it is right and fair for us to be recruiting doctors, nurses and care workers from less- developed countries. It may be serious within the EU, but it certainly is serious around the world.

I will give just one example. When the Ebola virus struck Sierra Leone, there were 136 doctors there, one for every 45,000 people; in this country, the equivalent figure is one for every 300 people. At that time, there were 27 Sierra Leone doctors working in the NHS. If we had not employed those people, we could have given a 20% boost to Sierra Leone’s health facilities. It is not the answer but when we set out our stall for the future we must consider our attitude towards the less developed world, and whether we will, as the noble Baroness, Lady Barker, said, take ourselves out of the international market for health and social care workers.

Immigration and Social Security Co-ordination (EU Withdrawal) Bill

Lord Hodgson of Astley Abbotts Excerpts

2nd reading & 2nd reading (Hansard) & 2nd reading (Hansard): House of Lords
Wednesday 22nd July 2020 Lords Chamber

[Lord Hodgson of Astley Abbotts (Con)]

Three-minute speeches require one to cut corners, which is always a dangerous thing to do and no more dangerous than when on is talking about immigration, an area where every phrase is liable to misinterpretation.

In the mid-1990s, before the Blair Government opened the gates to and encouraged large-scale immigration, the population of the country was 58.1 million. It is now 66.4 million, some 8 million higher. The ONS projection for the numbers for 2040 is another 6 million on top of that. It means that, in half a century, we will have added a quarter to our population. Today, as I speak, the population is going up by just under 1,100 a day, or just under 400,000 a year, with a third, roughly, from the natural increase—the excess of births over deaths—and roughly two-thirds from immigration.

Members of your Lordships’ House may regard all this with equanimity, but let me tell them that, outside, our fellow citizens do not regard it with equanimity; they are very concerned about it indeed. Recent polling says that no fewer than 74% of those polled believe the Government should introduce policies to deal with the challenges of rapid population growth. Of course, it is important, as my noble friend Lord Lilley said, not to demonise new arrivals; they bring a degree of economic and cultural dynamic without which we would be a much poorer country. But it is about scale, and it is important to recognise that, under the system of the past few years, there have been losers.

Who are the losers? They are the poorest in our society, as the wages for the bottom decile are now 12% lower in real terms than they were in 2008; they are older people, as it is increasingly difficult for people over 50 to get a job, and at a time when we are raising the retirement age from 65 to 68. Another loser is the British economy, whose Achilles heel is a poor productivity record, which is linked to the free availability of labour, meaning that no investment has been made in machinery; it is the developing world, because we, along with the rest of western society seem to see no moral fault in draining the developing world of its scarce trained resources. Lastly, it is our environment and ecology, because of the damage caused by rapid population growth.

In this Bill, we will be resetting the dial on this critical issue. In Committee, I will want to probe my noble friend on the Front Bench to reassure us, first, that those who have lost out in the years so far will not lose out in the next set of years and, secondly, that proper weight will be given to the quality of aspects of population growth, since they will have such an important and vital consequence for the country we leave our children and grandchildren.

Criminal Finances Bill

Lord Hodgson of Astley Abbotts Excerpts

3rd reading (Hansard): House of Lords & Report stage (Hansard): House of Lords
Tuesday 25th April 2017 Lords Chamber

[The Earl of Sandwich (CB)]

My Lords, I was not here for Committee and I apologise for rising at this late hour. I thank the Minister for her attendance at our meeting this morning, which was very productive. I admitted then that I had not seen government Amendment 8. Now that I have read it—in fairness to the noble Baroness, Lady Stern, I know that people have said that it is very welcome—it is actually quite disappointing for the aid organisations that have been campaigning. That should be on the record. It is really a restatement of existing government policy, and is not a compromise in that sense. I prefer to support my noble friend and others on Amendment 14 because it is only common sense. If we look back to discussion in Committee, we see that all they are asking is for the Government to complete their own programme of persuading the OTs to adopt public registers. This was a worldwide campaign, which we admire the Government for leading. It is now intended to include the overseas territories, although I fully recognise that there has been a slow take-up and that Orders in Council may be required.

I have worked with Christian Aid and many other organisations, as has the noble Lord, Lord Judd, which support the proposed new clause in Amendment 14. They are, to my mind rightly, concerned that the need for transparency should apply to overseas territories and developing countries just as much as to us. I hope the Minister now recognises that and will see her way to further compromise in future. The aid agencies feel strongly about this—after all, they are thinking of the majority of people living in those countries, not those sitting on the money.

Finally, I quote one informed reaction from Christian Aid to the new amendment. It states:

“The Exchanges of Notes signed between the UK Government and Overseas Territories in April 2016 on sharing beneficial ownership information already provide for a joint review of the operation of the arrangements six months after their coming into force, and thereafter on an annual basis. The report envisaged by amendment 8 is therefore already committed to. All this amendment does is put an existing commitment into law”.


The amendment does not mention transparency; nor does it mention developing countries. I therefore see no reason why we cannot support Amendment 14 and Amendment 8.

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, I have added my name to Amendment 24, which is about the UK register of overseas property. Before I speak to it, as the noble Baroness was kind enough to refer to my remarks in Committee about drifting away to murkier regimes, I took it from the way that she quoted it that she did not approve of that. I was relieved that my noble friend Lord Blencathra quoted it with approval, which shows that you cannot please all the people all the time. However, I do not want my noble friend, or indeed the noble Baroness or the House, to think that that remark was made in isolation.

I said that the status quo was unsustainable and that at least three issues should be tackled as part of the new regime: first, there should be a register; secondly, our law enforcement agencies should have full-hearted access to it in a way that is prompt, helpful and consistent with a working relationship; and, thirdly, the Government should be satisfied with the probity and effectiveness of the register regime in the overseas territories and Crown dependencies. It seems to me that government Amendment 8 meets those tests, which is why I support it. Rather than talking about drifting away to murkier regimes, I should be saying that we must not let the best become the enemy of the good.

With that, I turn to Amendment 24. It is important not to see the issues raised by my noble friend Lord Faulks as a problem for only central London and the inner suburbs. There is a knock-on effect from what is going on in central London with continuing overseas investment in London properties. That makes the urgency to which my noble friend referred a moment ago all the more pressing. First, there is a ripple effect on properties in the south-east of the United Kingdom: as the settled population sell their properties closer to the middle of London, they have further money to buy properties elsewhere in the region. A very interesting article in the Financial Times on Monday 3 April pointed out that house prices have increased by 102% since 2002, compared to a 38% increase in earnings; that Londoners now need to pay 12.9 times their earnings, up from 6.9 times in 2002, to buy a London house; and that if you wish to buy a house in Kensington and Chelsea, the heartland of the area that my noble friend has in his gunsights, you now need 31 times the median salary to afford it. There is a real sense that we need to get a grip and some clarity on what is going on.

There is a second impact because, as London has become more expensive, foreign investors have begun to look at other cities. The Times of Friday 7 April pointed out that Number One Cambridge Street in Manchester, a development of 282 flats over 29 storeys, has investment purchasers from Azerbaijan, China, Japan and Zimbabwe—18 nationalities. Only two of the 282 flats are owned by Britons. The developer wrote:

“The generously proportioned apartments … appeal to owner-occupiers, investors and renters. In other words, the scheme is appealing several sectors of the market, including those looking to make the step towards getting on to the housing ladder and more established owner-occupiers”.


I must say that I think first-time buyers in Manchester might wonder whether 99.2% overseas investors and 0.8% local ownership is a fair reflection. Here I offer my noble friend Lady Stern some comfort: one investor based in the British Virgin Islands has purchased 125 flats. A company called OFY paid £25.7 million for those properties.

Although the amendment is no silver bullet, it sets out an important direction of travel, which is why I support it.

[Lord Judge]

My Lords, there have been many speeches and I, too, was unable to speak at an earlier stage, so I shall be brief. Amendment 8 is good, but Amendment 14 is better. The reason it is better is simply this: it adds greater certainty to the idea that we and the British Overseas Territories are doing our level best to destroy this scourge of corruption which infests so many countries and does so much damage throughout the whole world. It may be that we are at the start of this process—I think the Bill is the very beginning of a process—but we have to start somewhere, and this is where we should start.

--- Later in debate ---

Moved by

[Lord Hodgson of Astley Abbotts]

20: After Clause 33, insert the following new Clause—
“Office for Professional Body Anti-Money Laundering Supervision
(1) Within six months beginning with the day on which this Act is passed, the Secretary of State must by regulations made by statutory instrument create a body to be known as the Office for Professional Body Anti-Money Laundering Supervision, with responsibility for improving standards of supervision and law enforcement in respect of money laundering.(2) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.”

[Lord Hodgson of Astley Abbotts]

My Lords, in moving Amendment 20, I will speak also to Amendments 21 and 22. With these amendments we return to an issue we discussed in Committee in a somewhat different format, but the underlying purpose this evening is the same: to increase the effectiveness and value for money of the current money laundering regime. Let me make it clear again, as I did in Committee, that this is not an attack on the utility of money laundering regulation in the fight against financial crime. However, I argue strongly that the present regime encourages mindless compliance, whereas it should be encouraging principled behaviour. As a consequence of this, the money laundering regime enjoys a very low level of public support and is too often regarded as a form-filling joke. That is a bad place for a regulatory regime to find itself. Its efficacy would be greatly improved if it were able to win over the hearts and minds of people, as opposed to earning their solemn acceptance.

Why do I think the present regime is ineffective? It is based very largely on the SAR regime—the suspicious activity report regime. Last year, just under 400,000 SARs were delivered. In the years since the present regulations were introduced in 2007, probably over 2 million SARs have been recorded. Consider the cost of their preparation and analysis. According to a freedom of information request, the outcome was that there were no convictions at all under the regulations in the first five years, from 2007 to 2012, and only four convictions and five more proceedings in the five years since. The National Crime Agency managed to recover assets totalling only £25 million last year, but claims that there are billions passing through London illegally all the time. If that represents success, I find it hard to think what failure would look like.

There is a Faustian pact between, first, the regulators, who are pressed to gather even little scraps of information, no matter how irrelevant; secondly, the compliance departments of the regulated firms, which are enjoying the opportunity for untrammelled growth in their activities and personnel; and thirdly, the professional firms that enjoy the fees earned from checking these ever-increasing compliance activities. No one ever steps back to get perspective and to see how this undoubtedly important activity could be done more effectively.

In Committee, I argued that to break into the cycle the National Crime Agency should be required to follow the principles of best regulatory practice, as laid out in Amendment 21, which we are discussing tonight. My noble friend would not, I am afraid, accept this line of argument, saying that:

“The NCA can and will act where there is criminal activity relating to money laundering. However, it does not have a regulatory remit, and to require it to have one would deflect it from its purpose of tackling serious and organised crime”.—[Official Report, 28/3/17; col. 532.]


I am not sure that I follow exactly that line of argument, but never mind—we have moved on from there. Now, we have the new body: the office for professional body anti-money laundering supervision, or OPBAS. It clearly should follow the principles of best regulatory practice. Amendment 20 requires the Government to set this body up within six months. This is an important body with an important role and therefore we need to get on with it, and to give Parliament sight of its structure and remit by means of requiring its establishment through an affirmative statutory instrument.

Amendment 22 lays down the principles that the body must follow. It must be proportionate, accountable, consistent, transparent and, most importantly, targeted at cases in which action is needed. Amendment 22 also lays down a series of processes by which the new body will ensure that the bodies it is responsible for regulating follow these principles. There is a series of ways of doing that, including publishing advice and guidance, and carrying out investigations to ensure that the operation is working effectively.

Before I conclude, to underline the seriousness of the situation we now find ourselves in, let me give the House a couple of examples of the mindlessness and the consequent drawbacks of the present regime. My most recent money laundering inquiry included a couple of dozen questions. Among them was the following: “We see you have links with a company called NS&I. Please explain these”. Since the inquirer had access to my bank account, they could see that it was an entry of £25 alongside NS&I. NS&I is, of course, National Savings & Investments. It was a premium bond winning; sadly, not £1 million, but never mind—every little helps. Does the NCA really think that the Government’s own saving authority is involved in money laundering?

A second question was: “We see that you worked in North America in the 1960s. What were your earnings?”. That was half a century ago. It is hard to think that I started money laundering the year after I left university and have so far carried on for more than 50 years, undetected. I was sufficiently irritated to answer this second question with the words, “I haven’t a clue”. Patently, that was an inadequate response, but comeback there was none. Perhaps the form was not read and just filed and the box ticked, or it was read and it was concluded that this was not an important or relevant question. Either way, it was an awful waste of the bank’s and my time. This is going on thousands and thousands of times around the country.

One can laugh about my case, but for many people triggering a money laundering inquiry catapults them into a Kafkaesque world where no one can discover who is accusing them or what they are being accused of. Since we last met in Committee, I have been sent various examples but will give only one this evening. A 43 year-old ex-soldier with a 16-year good-service record built up a capital sum of about £69,000 from his Army redundancy and other sources. On 14 February it was paid into his account at the bank where he had banked for 20 years. On 27 March, when he tried to withdraw part of the money to make his annual ISA subscription and to buy a car, he was told that the account had been frozen. Now, a month later, it still is. He has missed the opportunity to make his ISA investment because the tax year has ended. The bank will not—perhaps cannot because of the regulations—tell him what the problem is, and the Financial Ombudsman appears unable to intervene. He is also concerned that this incident will damage his future credit rating and he will have no way of obtaining redress. So there are very serious cases where this money laundering regime is not working effectively to catch the individuals it should really be aiming at.

In Committee, I referred to the increasing prevalence of de-risking by regulated entities. Under pressure from the money laundering authorities, they close down whole categories of accounts irrespective of their behaviour and performance because they might be risky from a money laundering point of view. I referred to a long-standing friend of mine who lives in Pakistan—a British citizen—who has had his account unilaterally closed. Since Committee, I have heard more examples of smaller charities about how they are finding it difficult to operate overseas because of money laundering regulations. Most recently, the Gurkha Welfare Trust is having difficulty obtaining banking facilities to transmit money to ex-Gurkha soldiers living in Nepal who have fallen on hard times. They live in Nepal and that is a red flag.

In the event that my noble friend cannot accept my amendments, although I am sure she is going to—

[Baroness Butler-Sloss]

I am extremely interested to hear—I fear that I did not hear it in Committee—about the proposal in Amendments 21 and 22. But how does the noble Lord see this office of professional body anti-money laundering supervision working, for instance in the case of the man whose money has been frozen? It is an interesting idea but I just wonder, as a former lawyer, how it would work in practice.

[Lord Hodgson of Astley Abbotts]

I am grateful to the noble and learned Baroness for that intervention, but I can glide this down to third man, if I may use a cricketing analogy, because this is a government proposal. The Government are proposing to set up this new body, so I am sure my noble friend, when she comes to wind up, will have all the detail of how this body will work. I merely wish to ensure that it is sent down the right channels. I know that my noble friend, with her usual aplomb and ability, will deal with that by stroking it effortlessly to the boundary, if I may continue the cricketing analogy.

It is important to do some serious re-engineering of the general approach to money laundering to increase its effectiveness and public confidence in it. That the National Crime Agency can, in its annual report, trumpet the fact that SARs went up by 7.82% over the last year as a badge of success without any reference to the impact it is having, shows that there is much to do. I beg to move.

[Baroness Hamwee]

My Lords, when the noble Lord responds to the debate, will he tell the House whether he thinks “I haven’t a clue” is purported compliance.

--- Later in debate ---

[Baroness Williams of Trafford]

My Lords, I congratulate my noble friend Lord Hodgson of Astley Abbotts on neatly batting off the question asked by the noble and learned Baroness, Lady Butler-Sloss—I could not resist; we have all made cricket jokes. I thank noble Lords for their interest in the outcomes of the Government’s recent review of the anti-money laundering supervisory regime. As a result of this review, the FCA has agreed to create a new team—the office for professional body anti-money laundering supervision, otherwise known as OPBAS—to strengthen the regime and help to ensure that professional body AML supervisors, such as the Law Society and the Institute for Chartered Accountants in England and Wales, comply with their obligations in the money laundering regulations. It is important to note that OPBAS will be a new team hosted in the FCA and is not in itself a new regulatory body.

Amendment 22 would require that the FCA would have powers to directly monitor and advise all practitioners subject to criminal finances legislation. This would be a significant extension of the FCA’s responsibilities. Rather, our intention is that the FCA’s new objective will be carefully targeted to address weaknesses identified through last year’s call for information, while preserving the existing strengths of the regime by focusing on helping to ensure that professional body AML supervisors comply with their obligations in the money laundering regulations. The noble Lords’ proposals would duplicate the role that existing AML supervisors play in safeguarding the UK’s financial system and would increase unnecessary burdens on businesses.

Amendment 21 would also require the FCA to have regard to regulatory best practice principles in delivering its new objective. However, I assure the House that the FCA will comply with its existing governance and safeguards as it goes about delivering its objective. As such, this amendment would be redundant and duplicate existing requirements on the FCA.

Lastly, Amendment 20 would require the powers the Government will pass to the FCA to fulfil this objective to be subject to an affirmative statutory instrument. It is our intention that this will instead be achieved in line with existing precedent; previous regulations to grant similar powers to the FCA have been subject to the negative procedure. I hope colleagues agree that we should follow that precedent on this occasion. Subject to the outcome of the general election, the Government intend to publish draft regulations for consultation over the summer before laying the relevant secondary legislation to underpin OPBAS later in the year.

To pick up on some specific points noble Lords have raised, my noble friend Lord Hodgson talked about de-risking being excessive and impacting disproportionately on normal people, as he has previously. He gave some compelling examples. The Government encourage the financial sector to take a proportionate approach based on the risks faced. Guidance for the financial sector, which is written by industry, is being updated for the latest money laundering regulations and is open for consultation until the end of this week. It is of course open to my noble friend to make his views known through this process.

The noble Lord, Lord Rosser, asked why the Government are not splitting the supervisory and advocacy functions of professional body supervisors. I can advise him that the 2017 money laundering regulations, which transpose the fourth money laundering directive, will require all professional body anti-money laundering supervisors to ensure that their supervisory functions are exercised independently of the advocacy functions, including, for example, the Law Society and the Solicitors Regulation Authority.

The noble Lord also made the point that the Government are subverting scrutiny by using the negative procedure. As I have mentioned, providing the FCA with new powers via the negative procedure is not new. It is in line with the wider transposition of the fourth anti-money laundering directive. There are a number of other powers that have been conferred to the FCA by the negative procedure. For example, the Money Laundering Regulations 2007 and the Money Laundering (Amendment) Regulations 2012 provide the FCA with powers to oversee financial institutions’ compliance with the money laundering regulations. The current set of MLRs provide the FCA with supervisory powers to oversee financial institutions’ compliance with the money laundering regulations. These include enforcement powers and supervision powers.

I am very grateful to the noble Lords for allowing me to address their points, which I hope I have. I hope, on that note, they will feel happy not to press their amendments.

[Lord Hodgson of Astley Abbotts]

My Lords, I thank the noble and learned Baroness, Lady Butler-Sloss, for her helpful intervention and my noble friend for her very full response. There is a really serious issue here that needs to be tackled. It is not just about bureaucracy and cost, but about unnecessary interference with people’s lives. Increasingly, it is also about damage to this country’s reputation as a place where you can get clarity. The question will be whether the new body can bring focus. The proof of that pudding will be in the eating. We shall have to wait to see whether it happens. My noble friend encouraged me to make my views known to the review. She need not worry; I have not missed that opportunity. I have written a letter already, so it has my views. We will have to see how it develops, but it will require vigilance, focus and care by the FCA to improve the regime, which is currently not working as well as it should. With that, to continue the cricket analogy, I will return to the pavilion and withdraw the amendment.

Amendment 20 withdrawn.