National Security and Investment Bill

Lord King of Bridgwater Excerpts

Report stage
Thursday 15th April 2021 Lords Chamber

[Lord King of Bridgwater (Con) [V]]

My Lords, in supporting the amendment I will first say how disappointed I am to be here at all. As we have gone through the Bill’s stages the argument has been very clearly made. I think a mistake was made in the original construction of the Bill and there now seems to be a determination not to repair the one problem that exists.

I say this as somebody who strongly supports the Bill. We need to have powers for the Secretary of State to prevent serious loss and threats to our national security. I note my noble friend Lady Neville-Rolfe’s comments, citing some of the pretty valuable businesses that should not have been allowed to go. If wiser counsel had prevailed that could have been prevented. This Bill would have helped that.

The other important thing that the Government have got absolutely right is ensuring that, if we are going to have this Bill and give the Secretary of State these new powers, there has to be proper parliamentary oversight of it. But they either were negligent or perhaps unaware of the important background: there are limitations affecting the operation the BEIS Committee. It is not qualified and will not be able to see any “top secret” information. If anybody on the government side seriously suggests that there could not possibly be any “top secret” information arising in connection with some possible takeover or acquisition, that position is not one they can seriously seek to sustain in a rapidly changing, increasingly technical and pretty dangerous world, as the noble Lord, Lord West, said. This is a pity, because I would like to pay my compliments to the Minister for the way he has handled the Bill. In every other respect it has been a model of parliamentary oversight and the proper review of it.

Referring again to what we now call the front row of the scrum, it seems, if I may say so, that we in your Lordships’ House each come from a different background. I, having been Secretary of State for a number of departments and then, for seven years, chairman of the ISC, was able to see this from both sides and saw the importance of there being, in the end, proper oversight of the intelligence agencies and of the intelligence and information that may be coming to them which government Ministers might be relying on.

Somebody has kindly sent me a copy of the letter sent by Jacob Rees-Mogg to Julian Lewis, and I echo something the noble Lords, Lord Campbell and Lord West, said: it is pretty dismissive and merely says that the committee’s role should not be on an ad-hoc, Bill-by-Bill basis, and that it would be a significant precedent, providing parliamentary oversight of the UK’s intelligence community. Although my noble friend Lord Grimstone paid what may have been a perfectly well-deserved tribute in Committee to the qualities of the BEIS Select Committee, the simple fact is, as my two colleagues have said, it will not be allowed to see any top secret information. It is not cleared for top secret intelligence that comes in, which might, on some occasions, be the key consideration that affects a decision the Secretary of State takes, for which there would then be no parliamentary accountability or oversight.

I have some sympathy with the Minister, because there are others who seem to have dug their heels in on this one, but even at this late stage, the argument does not stack up. A sensible decision by the Government would be to include this limited amendment to an otherwise excellent Bill and get on with it. Otherwise, it is a serious gap, and we could well pay the price for it in the future.

[Lord Butler of Brockwell (CB)]

My Lords, in my rugby-playing days I played in the back row, and I think I am right in saying that the noble Lord, Lord Campbell, played on the wing. However, I am very happy, in this case, to be in the front row with the noble Lords, Lord West, Lord Campbell and Lord King, even though the rules might say that that is one too many.

This is a very important amendment, and the House and the Government have to take it seriously. The noble Lord, Lord West, has made an irrefutable case for the involvement of the ISC, on the basis of what the Government promised Parliament during the passing of the Justice and Security Act and subsequently, and there really can be no answer to that.

I will come to the role of the ISC in a moment, but first I will draw attention to an oddity of Clause 61 in its present form if the amendment moved by the noble Lord, Lord West, is not accepted. We have been discussing the content of that clause, which stipulates that the Secretary of State must make an annual report to each House of Parliament about the exercise of the powers in the Bill. The clause requires that the annual report should cover details in no less than 12 areas, and the Government are now proposing to add to that. So much detail—but all the details are administrative. The clause in its present form omits the essential matter in which Parliament and the public will be interested: namely, the actual decisions of the Secretary of State and the justification for them—the grounds on which they were made. That is an extraordinary omission, and the first part of the amendment moved by the noble Lord, Lord West, puts it right.

National Security and Investment Bill

Lord King of Bridgwater Excerpts

Committee stage
Tuesday 16th March 2021 Lords Chamber

[Baroness Bennett of Manor Castle (GP) [V]]

My Lords, I have attached my name to Amendment 82 in this group, tabled by the noble Baroness, Lady Hayter of Kentish Town, and signed by the noble Lord, Lord Fox. It is perhaps unfortunate that the structure of the debate means that neither of them have spoken in favour up to now. Some of the other speakers have briefly outlined what that amendment consists of. As with all the amendments in the group, it is an attempt to ensure proper parliamentary oversight of the operation of the Bill.

This is a classic “prepare a report” amendment and specifies in considerable detail what would be in that report, including the nature of the national security risks posed in transactions for which there were final orders, the particular technological expertise that was being targeted and any other relevant information. I admit that, having listened to the noble Lord, Lord Butler of Brockwell, introduce Amendment 70, which essentially calls for oversight scrutiny to be in real time as decisions are being made, [Inaudible], and having listened to the debate, on reflection, that would be the best outcome. If I were to make a case for Amendment 82 in comparison, there would be advantages in having a specified list of what the report contains and making sure that full information is being provided to the ISC. I rather suspect that the ISC would be strong-minded if it thought that it was not getting the information it needed.

It is interesting how support for this group of amendments is coming from all sides of the Committee, and it is clear that there is a real problem for the Bill without some kind of provision on reporting to the ISC. That would ideally be done in real time but there should certainly be some democratic oversight. The noble Lord, Lord Butler, was pre-empting a ministerial suggestion that there would not be enough time. As the noble Lord said that, I thought about sitting in the Chamber of your Lordships’ House on 30 December and how much legislation those in both Houses of Parliament were able to get through in that one day. I am sure that the ISC could cope with the level of work required.

The noble Lord, Lord West, put it well. Without one of these amendments, there is no oversight. No one has referred to this yet but about an hour before we met, the integrated review was finally published and I skimmed through it as fast as I could. One matter highlighted in it was the competitive advantage coming from Britain’s democracy. I will be raising that issue again later but if we are going to claim competitive advantage from democracy, it would be good to have some of it. We have heard the phrase, “Take back control”, a great deal. The structure of our alleged democracy is supposed to rest within Parliament, which is where scrutiny and oversight of the Executive is supposed to happen. I join other noble Lords in saying that we must have some form of reporting to the ISC.

[Lord King of Bridgwater (Con) [V]]

My Lords, I am delighted to follow the noble Baroness, Lady Bennett, who has bravely intruded in this debate involving an old-school reunion of former members of the ISC. I am delighted to follow two of the promising newer Members, in the shape of the noble Lords, Lord Butler and Lord Campbell. Another, the noble Lord, Lord Janvrin, is still to come.

The examples given by the noble Lords, Lord Butler and Lord West, set out the arguments very clearly. Having been involved, as I was for so long, with the founding of the ISC and its initial seven years of operation, what was carried on subsequently—[Interruption] —bugger! I am sorry; excuse my language.

Hinkley Point C

Lord King of Bridgwater Excerpts

Tuesday 26th June 2018 Lords Chamber

[Lord Henley]

My Lords, again, there is no lack of clarity on this. The Statement made five years ago—“all those years ago”, as the noble Lord put it—made it absolutely clear that the approximately £128 million which was likely to come through business rate retention would come after the plant became operational. Meanwhile, there will be the benefits that I enunciated, which will come through the company building this project. On top of what I already mentioned, there is the spend it is making down the supply chain in the west of England—£450 million so far. So considerable benefits are already on their way, but business rate retention does not come into play until later.

[Lord King of Bridgwater (Con)]

My noble friend will be aware that this is taking place in my former constituency. It is one of the largest construction projects in Europe. People there are already facing fantastic lorry traffic: a figure I saw recently was 750 lorries a day going along not entirely ideal road routes. The local community is already making a substantial contribution by tolerating this terrific volume of construction traffic and all the work involved in it. My concern—the noble Baroness, Lady Featherstone, made this point—is that I understand that the real community benefit does not kick in until 2025. Actually, the community is making its contribution now. A lot of people do not have jobs there and will not be working there—some will, but only a relatively small number. We ought to find some way to ensure that the community benefit takes place at the time when the community is really suffering as a result of the present commotion and activity.

[Lord Henley]

My noble friend, with his local knowledge as the former Member for that area, knows exactly what his former constituents are going through, and he is right to address those points. All sites of this sort go through a rigorous planning process. In that process, it is possible for the planning authorities to grant planning permission through a Section 106 agreement, looking to get benefits from the developers in that area. That has been dealt with by the local authority in that process.

On top of that, as I made clear in earlier answers, there are also the advantages to the area through spend in the area—I mentioned the spend directly on the site, on the roads and on other things, the contribution that EDF is making, as well as the spend on the supply chain in the entire south-west region.

GKN/Melrose Takeover: Update

Lord King of Bridgwater Excerpts

Tuesday 27th March 2018 Lords Chamber

[Lord King of Bridgwater (Con)]

My Lords, the House will recognise that this is a very serious announcement about a major British company that is obviously facing some difficulties in its present operation and is now the subject of this takeover bid. It is extremely worrying that this has occurred at a time when, obviously, the future prospects for our economy are far from certain in the present Brexit developments. The Secretary of State was absolutely right to ask for the clearest undertakings, although, as the noble Lord from the Front Bench said, it has come rather late. I do not understand at all the idea that the Secretary of State has up to four months in which to intervene in something that may have already taken place. However, he does recognise that it is not just a matter of national security: the Secretary of State says he has a wider concern that the takeover should not act against the interests of the economy. He asked for undertakings from Melrose Industries plc, but I find them extremely inadequate. The company says that it is prepared to give an undertaking to maintain its UK listing and UK headquarters for five years, and to,

“ensure that the Aerospace and Driveline divisions retain the rights to the GKN name”.

However, it goes on later to say that if a strategic purchaser comes forward with an investment proposal prior to 2023, it hopes that it would be allowed to consider that. It goes on to add:

“Unfortunately, as a result of the nature of the transaction, we have not had access to the information we would expect in order to make detailed commitments”.


By the end of that, I wonder just what commitments are being given. This is a very serious matter and the Government need to think very carefully indeed. I pay tribute to Melrose, which is obviously an extremely successful company, whose business will be to acquire it and to sell it on. No doubt it will make a great success of that, and full marks to it for its approach. Whether or not it is appropriate in this situation, a heavy burden is on the Government to get far clearer and far more binding undertakings that will give some form of security to an essential part of the UK industrial economy.

[Lord Henley]

My Lords, I note exactly what my noble friend has said. As he said, my right honourable friend has up to four months to consider these matters, depending on the advice he receives from colleagues in the Ministry of Defence. I am also grateful to my noble friend for referring to the response from Melrose. It is not for me to say whether that is a good or bad response; I just note that, ultimately, it has to be a matter for shareholders and others. But parts of that, as I made clear—the letter is now in the public domain—will be enforceable commitments, albeit some of them for only five years, and another part will be undertakings of a less enforceable nature. It is not for me to defend or attack that letter. I have simply set it out as the response that my right honourable friend the Secretary of State received from Melrose following his letter, in which he set out, first, his legal obligations under the 2002 Act—which gave him a relatively limited power to intervene, which is quite appropriate. Secondly, however, he stressed—I am grateful to my noble friend for underlining this—the wider interests he has as Business Secretary and the wider interests that the directors have under Section 172 of the Companies Act as regards what they must look at. In the end, the shareholders will have to take a view on that matter. As I said, it is possible that my right honourable friend will have to make a decision in a quasi-judicial manner. He must await advice on that, and at that stage, if appropriate, he will intervene.

International Investment

Lord King of Bridgwater Excerpts

Tuesday 17th October 2017 Lords Chamber

[Lord King of Bridgwater (Con)]

In general, I welcome my noble friend’s announcement that the Government intend to act in this area. However, I have one concern. In consulting on possible amendments to the international investment arrangements, we notice what happened when the pound suddenly weakened and overseas investors took the opportunity to take over UK companies. I worry about what will happen in the interim, before any new changes are made. I have felt for some time that these changes need to happen, and if companies see that the rules may change for them quite soon, we may find that it pre-empts people into taking action now.

I also note from his Statement that the Secretary of State has been busy, helpfully, talking on the telephone to Airbus and Bombardier. I suggest that he makes one more telephone call to the chairman of Boeing, to say that that great company, which we much admire and with which we in this country have had very good relationships hitherto, has not been helped at all by this unfortunate action it has taken. The best thing it could possibly do now, in recognition of the complications it has introduced, is to withdraw the action it has taken and enable the companies to go forward in this new arrangement, which I greatly welcome.

[Lord Prior of Brampton]

My noble friend makes two important points. On Boeing, I cannot swear to it, but I think the Prime Minister has spoken to Boeing directly about this issue. Certainly, my right honourable friend Greg Clark, in the other place, is also in touch with Boeing. Boeing has two big investments in this country, which relate to helicopters and to a new facility it has opened in Sheffield, so it is an important part of our economy. I assure my noble friend that we are having conversations of the kind that he describes with Boeing. I understand my noble friend’s point that this consultation might lead to some companies pre-empting this and coming forward to buy a British company now rather than later. We have considerable soft power in these areas, so we can use quite a lot of influence behind the scenes to prevent that happening. But we certainly need to bear that consideration in mind.

Hinkley Point C

Lord King of Bridgwater Excerpts

Thursday 15th September 2016 Lords Chamber

[Baroness Neville-Rolfe]

I very much agree with my noble friend that we should learn from our experiences. That is something I always try to ensure we do in any area I am involved with. That obviously includes this. The honest truth is that this has been a difficult decision. That is one of the reasons why it was delayed, although we ended up with a decision in September, which was the most recent scheduled date.

My noble friend asks why there will be two reactors instead of one. There are two answers there. There are economies of scale. We have the skills and capability. The second point is that the consortium, led by EDF, came forward with a proposal for two reactors allowing for all of that and bringing many benefits that were weighed against the difficulties. We have made some changes, particularly relating to security protections, but we believe this project represents value for money for 7% of supplies of electricity over 60 years, of a sort that is a secure and reliable baseload, as they call it in the industry.

[Lord King of Bridgwater (Con)]

My Lords, can I cheer up my noble friend by welcoming this Statement on behalf of the people of Bridgwater, who have helped to ensure that Hinkley A and B have both provided loyal and continuous service over very many years to the nation? If there was to be a new nuclear power station, Hinkley is precisely the right place to put it. It is also a bit of a relief to everybody. My noble friend may know, and other noble Lords who have seen the pictures on television will know, that half the groundworks have already been done in anticipation of what they thought would be a favourable decision. It is a great relief that this has been decided.

I take seriously the points made by the two former Secretaries of State for Energy and by others. There are concerns about the experiences of the two power stations under construction. I hope that the advantage of coming third is that those lessons have all been learned. I hope the Government are fully satisfied in that respect. I do not think it is sufficient to say, “Well, it won’t be our cost if they’re not”, because the problems that would flow from it would be very substantial.

Something that is also very important indeed and is quite different from Hinkley A and B is that we never had cyberwarfare in the times of Hinkley A and B. That will become an ever-growing threat to critical national infrastructure. The need to ensure we protect the critical national infrastructure is enormously important.

As it is, I say to my noble friend that what is now happening is the relaunch of British involvement in the nuclear industry. I welcome the fact there is to be a nuclear college in Bridgwater for the training of nuclear engineers and apprenticeships. Now at last we will see a real chance to rebuild the position we used to have in the nuclear world and which, sadly, we have seriously lost.

I have only one other criticism. When we go back into the nuclear business, one comment in the Statement was that it will put out electricity for 60 years. That will certainly be a great improvement on the length of time that Hinkley Point A and Hinkley Point B managed. Is that a realistic assessment?

[Baroness Neville-Rolfe]

I am grateful to my noble friend for his support. I completely agree: this is a good deal for Britain and especially for our nuclear industry, which used to be world-leading and could be again. It is also excellent news for the south-west. I talked this morning to the local MPs and the local council. They are very pleased. They had the sword of Damocles of a loss of a very important project to that area hanging over them and are delighted by the news today.

I agree with my noble friend about the college. It is extremely good that, with the help of EDF, we were able to set up a facility for training in the nuclear industry. That can be of merit right across the UK.

Cyberwarfare is a new reality. It was obviously one thing we took into account in looking at all the different components of this deal. We strengthened the security protections and of course we have a civil nuclear police, who I am looking forward to meeting and talking to shortly in my capacity as the new Energy Minister.