Statutory Instruments (Amendment) Bill [HL]

Lord Thomas of Cwmgiedd Excerpts

2nd reading
Friday 18th October 2024 Lords Chamber

[Lord Thomas of Cwmgiedd (CB)]

It is a pleasure to follow the chairman of the committee on which I also have the honour to sit. I support what the noble Lord, Lord Thomas of Gresford, has put forward, congratulate him on his clear explanation and agree completely with him that the process must be amended by primary legislation. This Bill provides one step, but a very important step, in getting the balance right. It may be thought to be a matter of importance only to constitutional nerds and lawyers. It sounds very uninteresting, but this is a matter of great importance for two reasons. First, the Attorney-General in his Bingham lecture explained why it matters to the rule of law, but it also matters to the form of government we have. Secondly, the form of government we have now, as the three Nobel prize winners earlier this week have shown, is essential to economic prosperity and growth, so we cannot put this in the category of “not important”. It is central that we get some reform.

As the noble Lord, Lord Thomas, pointed out, the Attorney-General said in his lecture on Monday that a sharper focus on taking delegated powers is justified and there must be more careful consideration of the appropriate safeguards. I hope that, today or on a subsequent occasion, the Minister will be able to set out the concrete steps the Government intend to take to remedy this terrible problem. May I make three suggestions? First, it is plain that the Government have an addiction to delegated powers, the use of which became extremely extensive during Brexit interlude. There may have been reasons, but we must stop using them so much. The fact that the power is there does not mean it has to be used. I hope one of the steps we can take is to make Governments explain in Explanatory Memoranda why they are using delegated powers, rather than simply just using them. Breaking an addiction is difficult, but we have to take positive steps.

Secondly, there should be a requirement, save in exceptional circumstances, that no draft instrument be put forward without an impact assessment where the amounts at issue cannot be proved to be below the threshold for the provision of such an impact assessment. We need to return to the principle of good government: policy first, fully costed legislation second.

Thirdly, although the Secondary Legislation Scrutiny Committee is taking great steps to improve matters through league tables, they are no substitute for a proper government department to supervise the standards of ministries, which differ enormously.

Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Thomas of Cwmgiedd Excerpts

Committee stage
Tuesday 14th May 2024 Lords Chamber

As my noble friend Lord Palmer said, we also support Amendment 27, which includes risk and impact as one of the excepted considerations to be included in “financial and practical matters”. We agree that, if this is not included as an exemption, every investment decision will be open to legal challenge because all investment decisions must include risk and impact evaluation. The fiduciary duty of the LGPS is also affected, as this includes taking account of material financial risk when dealing with investments on behalf of others and exercising due care, skill and diligence when taking decisions on investment with the funds of scheme members. It is easy to see how, if this exception is not included, legal challenges could be mounted by interested parties when pension fund trustees are carrying out their duty to manage environmental, social and governmental risks when an investment decision goes against them, using the broad terms of the “moral or political disapproval of a foreign state” prohibitions in Clause 1.

[Lord Thomas of Cwmgiedd (CB)]

My Lords, I will make three brief points from the view of a lawyer. An awful lot has been said very ably by previous speakers about the reasons why, particularly in relation to Amendment 27, there seems to be no disagreement. This has nothing to do with the politics of the Bill; it is to do with making certain that we make the lives of those who become members of the pension fund board acceptable. I do not want to say too much about the burdens of being on a board or being a trustee of a pension fund—I do not want to put people off—but we ought to legislate to make their life easier in an age where litigation risk is growing. This Bill adds to that litigation risk, which is the second factor that we should take into account. I will not go into Clause 5 now because we will come to it later, but we must take into account the extraordinary encouragement it gives to litigation.

Everyone seems agreed on the objective, particularly in Amendment 27, that financial risk and impact should be taken into account. It is baffling; it is bad legislation to rely on the words rather than to take two minutes to amend the Bill. I am sure this debate has cost more than the cost of putting the Bill right. It cannot possibly be about the parliamentary draftsmen’s pride. It is incomprehensible to me why we cannot put forward a short amendment to reduce litigation risk, make it more attractive to be a pension fund trustee and enable us all to go home a bit earlier.

[Baroness Noakes (Con)]

My Lords, the noble Baroness, Lady Drake, explained her Amendment 27 with great clarity, but I am afraid that I do not agree with her analysis of the problem, nor do I agree with the analysis of the noble and learned Lord, Lord Thomas of Cwmgiedd, for reasons which I will now explain.

Financial matters have been my stock in trade for well over half a century, since I left university. I have been trying to work out what these additional words, “risk” and “impact”, would add to the concept of financial value. The term financial value is not a term of art in my world, the accountancy world, but I think that it means something along the lines of the worth of something expressed in money terms. What something is worth can mean what it is realised for in a market transaction, or what it is worth in terms of the financial benefits it is evaluated to or expected to bring. I believe that neither “risk” nor “impact” add anything to the meaning of financial value.

I start with risk. Risk will affect value, so any determination of what something would fetch in a market or what benefits it would bring would of course take account of the risks when doing the calculations of financial value. This is just 101 of calculating things in financial terms. That is effectively why the DWP documents refer to risk. They do not refer to documents about risk as an adjunct to financial value; they are just encouraging the identification of risks, because that is a normal part of a balanced evaluation. While I do not think that the word risk does any particular harm to the concept of financial value, I do not think that the word is necessary.

I have struggled a bit more with working out what financial impact means. The only thing I could come up with was something like the evaluation of the net costs or benefits to be obtained from what is being acquired, but I cannot see what financial impact adds to the meaning of financial value. In this case, it would be positively confusing to add financial impact alongside financial value, because it might encourage somebody to litigate on the basis that there was a difference between financial value and impact, as Parliament clearly meant something other than financial value by the concept of financial impact. That would be a failure on our part to create certainty in our legislation.

I would also like to comment on Amendment 46A, from the noble Lord, Lord Collins, which is in this group. I expect he will be speaking to it a little later. I could not understand why the noble Lord has chosen UN-related documents to refer to when trying to put what he calls “established investment principles” into the Bill. The UK Government have already announced a series of actions that they have implemented in relation to the UN guiding principles on business and human rights, much of it already in legislation and unaffected by the Bill. In response to those principles, the relevant parts of our legal system are already in place, and we do not need to refer to a UN document to get any further on investment principles; they have already been interpreted by the UK Government.

Furthermore, we already have a perfectly good Stewardship Code in the UK, issued by the Financial Reporting Council, which deals with ESG matters. I do not believe the Bill alters that at all, so long as ESG principles do not acquire a territorial dimension.

--- Later in debate ---

[Baroness Neville-Rolfe (Con)]

To confirm, I think that is what I said a couple of minutes ago. The sole reason must be that it is financially risky—that it is business risk guidance, not boycotts. My own feeling is that that is a helpful clarification. I am sure that noble Lords will look in Hansard at what I have already said.

If I might now finish, I would very much like to—

[Lord Thomas of Cwmgiedd (CB)]

Before the Minister sits down, which she has indicated she is very anxious to do, I would like to go back to the, in my view, very unfortunate discussion that we have had about the definition suggested in Amendment 27.

As I understand it, it is accepted that financial risk is included within the wording. What is unclear—no doubt in years to come people will pore over the Minister’s speech, so I want another little bit for them to pore over—is: what about financial impact? I think the Minister said that that gave rise to uncertainty, but it would be helpful to know whether, in looking at the way in which decisions can be made, the financial impact can be taken into account. It would be so much better, of course, if we put the words in the Bill and left it not to accountants but to lawyers to deal with in the future.

[Baroness Neville-Rolfe (Con)]

I can reassure the noble and learned Lord that lawyers have been involved in drafting the Bill, as he can probably imagine. I tried to set out quite clearly at the beginning why we felt that the wording we got was right; that included financial impact. I have subsequently clarified the point about motivation and financial risk.

In the excitement, I have lost my place. I was asked about the effect of removing Clause 12, and was hoping to be able to answer the noble Lord. Removing the clause would mean that the ban would not apply to the fund investment decisions of administering authorities of LGPS. The administering authorities are local authorities, which are clearly a core part of the state and are therefore public authorities for the purposes of Section 6 of the Human Rights Act. That is why they are the only pension funds captured by the Bill. We have seen clear examples of local authorities attempting to engage in BDS activity in the past. It would not be appropriate to apply the ban to funds administered by private entities, such as the Universities Superannuation Scheme.

As I have argued before, council tax payers should be able to expect their local councils to exert time and effort on solving local issues, rather than spending time thinking about boycotts of foreign states when, as the noble Lord has said, the beneficiaries expect the responsible authorities to concentrate on returns and the ongoing viability of their investments in the interests of the beneficiaries. If the Bill were to stand without Clause 12, councils coming under pressure to develop their own policies on divisive international issues would be pushed towards an LGPS loophole to implement BDS campaigns.

The priority for these funds should be to provide stability and good long-term returns for the hard-working local government officials who are their members. We now know that this includes the noble Lord, Lord Warner, the noble Baroness, Lady Janke, and others. The Bill helps the administering authorities not to be distracted from this important purpose, and to focus on returns in a responsible, long-term way. For these reasons, I ask noble Lords not to press their amendments and not to oppose the question that Clause 12 stand part of the Bill.

Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Thomas of Cwmgiedd Excerpts

2nd reading
Tuesday 20th February 2024 Lords Chamber

[Lord Thomas of Cwmgiedd (CB)]

I wish to speak on only one issue, one that the noble Baroness who preceded me has just dealt with: the way the Bill works with devolution. It is important to understand the context. The Bill is so widely drawn that it deals with decisions or views that express disapproval of foreign state conduct. It is all justified on the basis of foreign policy, but it is very important to distinguish between the wide terms of the Bill and the much narrower interests of British foreign policy. That is important for two reasons, to which I shall come.

It seems clear from the Bill and the various devolution statutes that the Bill affects powers that have been devolved to the national Parliaments and Governments. I thought this was not in dispute to a large extent, because pages 13 and 14 of the Explanatory Notes, first, tick boxes that say that legislative consent would be sought and, secondly, seem to accept that, at least as regards the executive powers of Ministers, devolution powers are engaged. I very much hope that the Government have not changed their position on that and that they will not proceed with this legislation without obtaining legislative consent. There have been far too many instances where this Government have overridden the devolution settlements, and it is not in the interests of the unity of the United Kingdom that this is continued.

As I understand it, it is claimed that much of the Bill does not involve devolved competences because the general reservations in most of the devolution settlements expressly reserve international relations, the regulation of international trade, and international development assistance and co-operation, although there are qualifications to that. In a Second Reading debate, I do not want to go into the finer and more detailed and difficult legal points in relation to the devolved settlements, and I am sure that the Minister, in replying at a late hour this evening, will not want to deal with that.

I return to what I regard as a central point. As I understand it, the Bill’s wording is intended to prevent the devolved Governments adopting a procurement policy based on their disapproval of the policies or conduct of any state. That is extremely wide. It is not confined to conduct that is in conflict with the foreign policy of the United Kingdom. One can understand why relations with foreign policy are reserved and departures from UK foreign policy might be justified as a reservation, but, given the wide scope, this is very difficult.

Secondly, as the noble and learned Lord, Lord Etherton, has shown, the exceptions in Schedule 2 are extremely imprecisely drawn. I agree completely with what he said about international relations. If you look at the one in relation to environmental conduct, you can see that it is even wider as it applies to something that may be an offence under the laws of any state. These points are important because of Clause 5, which permits judicial review. If there was no judicial review in it, one could expect the good sense of government not to intervene—but, once you open up judicial review, you are vulnerable to people who want to use it in this sort of policy area for commercial or political advantage. So the exact precision of this Bill is of great importance for that reason.

I have one question for the Minister, which I hope that she will be able to answer, but—bearing in mind what I see as very serious flaws in this Bill—there is another question. If, for example, the Bill when an Act is to work properly, how will we deal between national Governments and with local authorities in determining what they can do that is consistent with British foreign policy and with what is, on any reading, disapproval of the conduct of a foreign state? Is a blanket prohibition to apply, or will there be some mechanism? It is extremely unclear from the Bill how in practice this will work, particularly in the light of the availability of judicial review for persons who wish to cause mischief to bring proceedings.

There should be a forum for intergovernmental discussion of these issues, and I very much hope that the Minister will be able to deal with this dichotomy between the interests of foreign policy and the blanket prohibition and a sensible procurement policy, whereby the devolved Governments and others can use their procurement and other powers in a wide compass without fear of litigation.

Procurement Bill [HL]

Lord Thomas of Cwmgiedd Excerpts

2nd reading
Wednesday 25th May 2022 Lords Chamber

[Lord Thomas of Cwmgiedd (CB)]

My Lords, I too welcome the Bill but I want to make five short points. First, as a victim of bad government procurement and as someone who has had to look at the law quite carefully, I cannot but emphasise the importance of the remarks of the noble Lord, Lord Maude, that in considering the Bill what matters, as in most legislation, is the delivery and the three stages he described. I shall not weary noble Lords with more stories about it but, believe me, my whole experience is that that is far more important than the law.

Secondly, however, we must get the law right. Therefore, I warmly welcome what was suggested by the noble Baroness, Lady Hayman of Ullock: the Bill should contain principles. It is plain that this was thought of. One can tell from the table of contents and the headings that someone forgot to take the word “principles” out because there are no principles. There is a principle, which I think is self-evident, that you have to procure in accordance with the Bill. There is no point in having a clause to say that, so the draftsman may have had second thoughts. A good lawyer ought to have second, third and fourth thoughts. It would be very helpful to know what the considerations are so that the House can reach a judgment.

The reason I think there should be principles takes me to my third point. It is plain that there is a relationship between procurement and subsidy. In the discussions on the Subsidy Control Bill, it was accepted that procurement could be used to subsidise and encourage local performance. I cannot find any reference to subsidies in this Bill and it therefore seems very important to put into a principle the relationship between control of subsidies and its use to develop the local economies and procurement. It has to be grappled with and this should not be left to the courts.

Fourthly, in looking at this piece of legislation, which I hope simplifies matters, it is a great misfortune that we will end up with a regime in the United Kingdom —forgetting the Northern Ireland protocol for the moment—that applies to three of the nations but not the fourth. I really hope that the way the Government have been able to bring in Wales and Northern Ireland will influence Scotland. It is surely to its advantage that there is a single procurement regime. It must be to its economic advantage, although I can see why there are arguments that some may think it not to its political advantage.

My fifth point is about the importance of remedies. The noble Lord, Lord Mendelsohn, was quite right in the point to which he drew attention. I am afraid I do not agree with the noble Lord, Lord Whitty, about the Subsidy Control Act. That has the CMA in it but the CMA does not have many teeth and depends on private enforcement. This Bill is wholly dependent on private enforcement. I do not want to develop this point now, but when one looks at Part 9 there are terrible problems, particularly for smaller companies. If you have a dispute about the contract for the west coast line, one can see that money may not be too great an objection, but when you have a much smaller one—and much of this is concerned with smaller sums of money and encouraging SMEs—you must have an enforcement process that is economic.

One resort might be that suggested by the noble Lord, Lord Mendelsohn, which is recourse to an outside body other than the courts. But I very much urge the Minister to engage with the Civil Justice Council to see if a process can be devised that deals with the real problems of procurement. You want to use the power to deal with a difficult contract where the process has been in breach of the regulations by stopping that going forward, but you do not want to end up in the situation where you allow that contract to go forward, without having looked at an alternative available remedy of damages, and the local authority or the Government end up paying all over again.

It may be in the public interest in this case for there to be something short and sharp that comes to a decisive conclusion, but remedies are a key issue which we should not ignore. It requires creatives thinking. We ought not to rely on the traditional way, as the courts have done. It is very good for lawyers—they make a lot of money and will have an even better year next year—but we must do something to deal with the unique problem of ensuring that the people who breach these regulations do not go forward with a contract and that the taxpayer does not end up paying two people. Those are my five short points.

Beyond Brexit: Institutional Framework (EUC Report)

Lord Thomas of Cwmgiedd Excerpts

Monday 6th December 2021 Grand Committee

[Lord Thomas of Cwmgiedd (CB)]

My Lords, I thank the noble Earl for securing this debate. I also want to say a word on the noble Baroness, Lady Donaghy, who managed to steer so many disparate views together to produce a report which is so comprehensive on the subject. Others have spoken today about SMEs, the Erasmus programme and, equally importantly, the creative industries, which have suffered so greatly from what has happened. However, I want to take a very narrow perspective.

In most respects, it is too early to tell whether the TCA works but there is one area where we can see a problem ahead. It is illustrative of a major problem with which we have to deal, and it is the Lugano Convention. I am not interested in its details but why there is the refusal to allow us to accede. It is really for one reason alone: competition. How are we going to deal with that and make our services competitive? I regret to say that I want to do this through the microcosm of the law. I hope the Committee will forgive me, as it is not that technical a subject in this respect.

The key to the success of our system has been English law, and I say that as a Welshman. It is important to appreciate that we have huge advantages in this country. We have good leadership and our judiciary is outstanding; we have huge support from the City of London and the professions; and to be fair to it, the Ministry of Justice has done a bit, particularly since the noble Lord, Lord Wolfson of Tredegar, was appointed a Minister. However, the real issue is: how do we deal with competition? First, we must not be complacent. I am sure we are not, but what is the key to this? The law is developing at an immense pace at the moment. I had thought of saying something about climate change, but thought that it might be a little tricky.

I think it is safer for me to stick to an area where the change has been accelerated massively by the pandemic: the importance of digital infrastructure and the trade in data. This is a very fast-moving area. Certainly in Europe at the moment, much less attention is given to the GDPR, which seems to have been our focus, than to the industrial value of data. Therefore, we have to look to the future of English law, which is the basis of the success of our legal profession, and ensure that it is taken cognizance of and fitted into the fast-developing changes.

We ought to reflect on the fact that our system is flexible, innovative and has a long tradition of leadership, but rhetoric sometimes forgets that we share a common European legal heritage. To pick up what the noble Baroness, Lady Armstrong, said, should we look at competition in this area by subtle co-operation, or do we indulge in a stand-off or rhetoric that does not help? I have no doubt that if we are effectively to deal with competition in this area in law—it applies equally to regulation—our job is to participate on a co-operative basis to show that we have the skills to lead, which we do. However, we will not get anywhere in deploying those skills unless we act with an openness that enables us to put forward ideas and solutions that allow the basis of our law to be recognised as the way forward.

Therefore, I want to ask the Minister whether we can stop using a rhetoric that discourages co-operation. My whole experience in Europe, particularly over the last couple of years—I mean not just the European Union but Europe as a whole, working closely on the development of European Union law and transnationally—is that the only way we will succeed in competition is by friendly co-operation, with a keen eye on our long-term goals. This is a long game, and we must not lose it by rhetoric that does not foster co-operation and the subtlety with which we have managed our legal system. The common law has always been a magpie: it takes good ideas from everywhere. It is not nasty to other people or disrespectful of them, but acknowledges everything with gratitude. I hope we can go forward on that basis.

Wellbeing of Future Generations Bill [HL]

Lord Thomas of Cwmgiedd Excerpts

2nd reading
Friday 25th June 2021 Lords Chamber

[Lord Thomas of Cwmgiedd (CB)]

I, too, warmly welcome the Bill and congratulate the noble Lord, Lord Bird, on bringing it forward. As has been said, Wales has similar legislation. In the short time available, I want to comment on two aspects of that legislation that may prove problematic.

The first problem with the Welsh Act is that the duties may not be clear and specific enough to be enforceable; secondly, there is no proper mechanism for legal enforcement. These issues were covered in the report of the Commission on Justice in Wales, which I chaired, and I tried to deal with them in much more detail in the David Renton lecture I gave to the Statute Law Society in November 2019. Suffice it to say today that if legislation is not to be aspirational, and is therefore to be effective, it must create specific legal duties and have a mechanism for enforcement. That is why I warmly welcome this Bill; it has legal duties that can be made specific enough, and there is an enforcement mechanism.

Clause 6 and various provisions of Part 5 address the issues that may be defective in the Welsh Act. The duties are either laid out in sufficiently specific terms or the recommendations made by the commission, which become enforceable, can be made specific enough, and there is an enforcement mechanism before the High Court. Therefore, when enacted, the Bill would be a powerful instrument with appropriate machinery for ensuring that politicians—I pick up, with respect, the point of the noble Lord, Lord Bird, about that—could not give way to short-term or electoral interests or to pressures from others.

Our country’s future could be a real future with this Bill. We simply cannot go on ignoring the reality that without independently enforceable duties, the interests of the short term and the pressures of the electoral cycle will triumph. That is why the creation of legal and enforceable duties under this Bill will provide a real future for our children, our grandchildren and their children. I wish the Bill well.

European Union (Future Relationship) Bill

Lord Thomas of Cwmgiedd Excerpts

3rd reading & 2nd reading & Committee negatived & 2nd reading (Hansard) & 2nd reading (Hansard): House of Lords & 3rd reading (Hansard) & 3rd reading (Hansard): House of Lords & Committee negatived (Hansard) & Committee negatived (Hansard): House of Lords
Wednesday 30th December 2020 Lords Chamber

[Lord Thomas of Cwmgiedd (CB) [V]]

As there is now no alternative to this deal, except no deal, there is one brief point I wish to make for the future. There we do have an alternative: implementing the deal in a way that rolls back the growth and supremacy of the executive branch of Government, which this Bill seeks further to strengthen, in ways described by the noble Baroness, Lady Taylor, and the noble Lords, Lord Pannick and Lord Anderson of Ipswich. That alternative requires the restoration of the position of Parliament, adherence to the devolution arrangements and ensuring the continued independence of the other branches of Government.

I will take one illustration: state aid, set out in part 2, heading 1, title XI of the treaty. Its proper implementation and operation are essential to our prosperity, and to a strong relationship with the European Union. One central provision again suffices: article 3.9 within that title, which requires the UK and the EU each to establish

“an operationally independent … body with an appropriate role in its subsidy control regime.”

There are at least five defining tasks that we must carry out in relation to this one article alone. First, consensus is needed with the devolved Governments for, although state aid control is now a reserved matter, state aid is devolved. Secondly, proper registration, dealing with all the detail, is needed, not framework legislation with delegated powers. Thirdly, the independent authority that is to exercise the control over subsidies must have independent decision-making powers, and not be some sort of quango advising the executive branch of government. Fourthly, there must be no attempt to curtail proper judicial review or appeal, by independent courts or tribunals, of the decisions. Finally, the working of these arrangements in the UK, and the way the corresponding arrangements work in the EU, must be scrutinised by a properly resourced parliamentary committee.

That is the task in relation to one article, but if it is achieved for that article in relation to state control, and there are similar achievements in the countless other new arrangements necessary, we should be able to ensure that, as the UK regains control, that control is exercised through parliamentary sovereignty, under the properly balanced operation of our constitution, and not under executive supremacy.

United Kingdom Internal Market Bill

Lord Thomas of Cwmgiedd Excerpts

Consideration of Commons amendments
Monday 14th December 2020 Lords Chamber

Moved by

[Lord Thomas of Cwmgiedd]

At end insert “and do propose Amendments 48E and 48F in lieu—

48E: Clause 48, page 40, line 41, at end insert—


“(1A) The powers in subsection (1) may only be exercised—


(a) after consultation with the relevant authority on the principles under which financial assistance may be provided by a Minister of the Crown;


(b) after publication of such principles; and


(c) after considering the advice of persons jointly appointed by the Minister of the Crown and the relevant authority for each of Wales, Scotland and Northern Ireland as to the way in which, applying the principles, the allocation of financial assistance respectively to Wales, Scotland and Northern Ireland which could have been given by a relevant authority should be provided.”


48F: Page 41, line 10, at end insert—


““relevant authority” means the Welsh Ministers in respect of Wales, the Scottish Ministers in respect of Scotland, and the Northern Ireland Executive in respect of Northern Ireland.””

[Lord Thomas of Cwmgiedd (CB) [V]]

My Lords, I thank the Minister for the opportunity to have had discussions with her on two occasions. I am grateful indeed. There are three short reasons why I hope that the House will accept Motion F1 and Amendments 48E and 48F, which I seek to move and the compromise within that is intended. Those reasons can be explained briefly as follows.

The first is that the assertion of financial privilege is one to which there are two answers: it is not a financial issue, it is a constitutional and devolution issue. The scope of financial privilege is a question that will need to be discussed further in due course as the precedents on financial privilege need to be considered in the light of devolution. However, this is not the occasion. The issues in relation to devolution are addressed in this amendment in a way that simply seeks to clarify the need for consultation, principles and advice, all of which are so essential to the function of a union, but they do not impinge on the power of the other place.

My second reason for the amendment is that the way in which it seeks to proceed is to set out a principal reason for spending in the devolved areas. The UK Government and the devolved Governments should work together to strengthen confidence both in the Governments and in the union. The clause requires, as before, consultation in establishing the publication of principles and—this is new—the consideration of advice from the devolved Governments in the field where powers have been devolved. This goes nowhere beyond the devolved powers and it seeks simply to uphold the devolution settlement. The keys are consultation, principle and advice.

It is of course for the UK Government to decide whether they will follow that advice, but perhaps I may make three short points. If the advice were to be followed, it would stop the UK going back, as the Minister has observed, to “Westminster knows best.” If the UK Government were to follow the advice, it would say that they can work with the Governments that have been elected by the people of Northern Ireland, Scotland and Wales to spend wisely in the devolved fields by accepting the advice of those who know best in the devolved institutions. Secondly, it would also give the spending of those funds a considerable degree of democratic legitimacy by ensuring that the democratic mandate to spend in the devolved fields was heeded. Thirdly, if the advice was followed, spending would be much more efficient, as there should be co-ordination of spending. The real risk of inconsistent and, worse still, competitive spending, would be avoided.

My last main reason is, in short, is that the amendment seeks to lay part of the foundation for the exercise of statecraft, something that is so necessary to ensure the future of our union. The question may therefore be asked: why is it necessary to put this into a Bill? We simply cannot afford the failure of statecraft in relation to the union. Experience has shown that a clear mechanism is the best way of providing for co-operation between the four nations. There can be no more important area in which to do this than in relation to the working together, with a common and unified purpose, to increase the prosperity of each of the four nations, and here I refer in particular to the very deprived areas within those four nations. I beg to move.

[Lord Adonis (Lab)]

I strongly support everything that has just been said by the noble and learned Lord, Lord Thomas, and I hope that my noble friends in the Labour Party will support him in his amendment if he presses it to a vote. The points he has raised are absolutely fundamental to the devolution settlement. The big issue here is what happens in lieu of the big decisions that used to be made about the structural funds. The noble Baroness the Minister said in our last debate that it was the European Union that would decide, which of course was technically true because these were EU funds, but the advice upon which projects are prioritised within the devolved Administrations very clearly flowed from the devolved Administrations themselves. If we do not observe that principle in respect of the Shared Prosperity Fund and whatever may replace it over time—the noble and learned Lord, Lord Thomas, has explained that we are putting in place within statute a regime that could now last for decades—what we will be doing is substantially rolling back the devolution settlement.

The noble and learned Lord used a slightly antiquated term, “statecraft”, but it is coming back into vogue, because we have so little of it. Indeed, as some noble Lords might recall, the Prime Minister told us some while ago that it would be a failure of statecraft if there was not a deal, which he very nearly railroaded the country into over the past weekend. It would be an equal failure of statecraft if the devolution settlement starts to break down because of irreconcilable differences between the devolved Administrations and the UK Government on fundamental issues relating to the allocation of structural and regional funding within the UK.

The position that we are in, which is why I think it is so important that the noble and learned Lord presses his amendment, is this: can we simply take the rather vague assurances that the Minister has given us today as being sufficient? In respect of the operation of the whole devolution settlement, which is something that one would expect to roll over from Government to Government as a part of our constitution, I do not think that the assurances which have been given as set down in Hansard are sufficient. It is important to have them in statute. Thus, I think that the arrangements that the noble and learned Lord has set out in his Amendment F1 are absolutely appropriate to what we are facing in this area.

The other reason is that in my experience, people’s past behaviour is always the best guide to their future behaviour. On the basis of the Government’s past behaviour, I do not believe that we can accept those assurances as being sufficient. This is the Government that introduced the towns fund under which Ministers themselves could decide on a wholly arbitrary basis that was not related to any objective statements of need, how they would allocated hundreds of millions of pounds—I think in the end billions of pounds under the fund; I have just been told £4 billion—based on arbitrary and essentially political criteria. How can we accept a vague assurance about consultation with the devolved Administrations when we know that that is how Ministers of the Crown have behaved?

It seems to me to be absolutely essential, not simply desirable, that we put into statute the requirements of the noble and learned Lord’s Amendment F1. They seek that the Government should make these further investments only after consultation, which is the crucial element of his proposed new wording for Clause 48

“on the principles under which financial assistance may be provided by a Minister of the Crown.”

That would set out in law the requirement that there must be consultation on principles.

If I have a concern about the noble and learned Lord’s amendment, it is that it is too weak. This is the classic problem when one starts to compromise. You end up by giving up too much ground. As I read it, I think that the wording of his amendment is too weak because it requires consultation on principles. On my reading of the amendment, it does not require the consent of the devolved Administrations to disbursements that are made in respect of additional investments like the Shared Prosperity Fund.

I will put this to the noble and learned Lord: what would happen if, having consulted, the United Kingdom Government do what they now seem to do routinely—the Prime Minister has told us that he does not believe in devolution—and simply override the view of the devolved Administrations and decide on a political basis to make what are essentially politically motivated investments anyway?

I hope the noble and learned Lord can disabuse me, but my reading of the wording of his new amendment is that the United Kingdom Government would, having consulted, none the less be able to ride roughshod over the devolved Administrations and decide what they want to do for political reasons in London and Westminster. The noble Baroness said—we liked her words—that she was seeking to give backing to the principle that it is not the case that Westminster knows best; my reading of the state of the law, which is what will matter on these things, is that it would be perfectly okay for future Governments to say not only that Westminster knows best but that the Conservative Party knows best and will distribute funding in Scotland, Wales and Northern Ireland in respect of Conservative Party priorities and not any priorities agreed with the devolved Administrations.

I strongly support the noble and learned Lord’s amendment. It goes to the heart of what will happen to devolution after Brexit. My concern is that, in the process of compromising as this Bill has gone through, the amendment is too weak to deliver the objectives which the noble and learned Lord so rightly set out.

--- Later in debate ---

[Lord Thomas of Cwmgiedd (CB) [V]]

I thank all noble Lords who participated in this debate—particularly the noble Lords, Lord Adonis, Lord Fox and Lord Liddle, and the noble Baroness, Lady Bennett of Manor Castle—which has lasted slightly longer than I anticipated.

The debate on both this occasion and previous ones has centred on the question of financial privilege. I am very grateful to the noble Baroness, Lady Noakes, and the noble Lord, Lord Stevenson of Balmacara, for their observations on the uncharted territory into which we might be moving. It is important for the future to work out the way in which ancient principles may no longer be applicable to constitutional issues if we are to keep our union together.

In looking at this whole series of debates together, there has been another consideration. At least there is now a much greater understanding of the importance of respecting the devolved settlements and devolution. I was heartened when the Minister referred to an abandonment of “Westminster knows best”. That is progress indeed. I have also taken the Minister’s assurances into account. As one looks at the debates in the other place on the previous debates in this House, it is clear that those from Edinburgh, Cardiff, Belfast and other places within those three nations, pay particular attention to what has been said. I am glad the Minister has given assurances in relation to principles of consultation and heeding advice.

It is a question of weighing up whether putting a structure into the Bill in the circumstances I have outlined would be a sufficient safeguard. Or is there a better safeguard: that is, the deterrence of the catastrophic result for our union if the Government did not adhere to the principles that have been explained? It would be catastrophic not only for the union but for trust in government if there was ever a hint of unprincipled distribution or application of these funds—[Inaudible.]—and of the pork barrel.

Therefore, with considerable hesitation, but bearing in mind that deterrence is a strong way of ensuring people keep to their principles—possibly stronger than structures in some places—with great reluctance I beg leave to withdraw this amendment.

[The Deputy Speaker (Lord McNicol of West Kilbride) (Lab)]

Is it your Lordships’ pleasure that Motion F1 be withdrawn?

--- Later in debate ---

[Baroness Bowles of Berkhamsted (LD) [V]]

My Lords, I will speak to my Amendment 50F and Motion G2, which I may wish to move. I also support Amendment 50E and Motion G1. Amendment 50F looks to the stage at which there may be changes to state aid provisions, whether that be changes in definitions, remedies, or the scope of exemptions, or introducing conditions or time limits on approval. I agree with the Minister that at the moment they are gone, but might not alternatives be introduced, or some aspects reintroduced? I think that would also constitute a change.

The EU state aid provisions were indeed the subject of a statutory instrument recently, and they end at the end of the transition period. But, as the Minister has informed us previously, the UK will follow WTO rules and consult and report on whether any wider scope is to be introduced. If the outcome is a recommendation for going wider—some kind of policy change—it begs the question of how it will be introduced.

My proposal is not made instead of consultations and approvals with the devolved Administrations, which we support; it is in recognition that the full range of public authorities and businesses are affected wherever they may be. Therefore, the detail of how any post-consultation policy change is implemented is of significant interest.

The withdrawal Act was used to make the changes that happen at the end of the transition period. But it would seem inappropriate for that to be used for any new policy. A new policy other than moving to the WTO default should surely have the scrutiny of primary legislation.

I know the Minister may say that how policy is to be implemented can be a point in consultation, but my submission is more constitutional than convenience. Parliament should be able to scrutinise and amend, and to spot those weaknesses and problems that this House in particular has the experience to iron out, especially at the first time around of making independent, post-Brexit state aid rules.

Therefore, my Amendment 50F seeks to put on the face of the Bill that changes to the test for harmful subsidy remedies, the scope for exemptions or the conditions or time limits on approvals may not be done by regulation. I do not seek to prevent policy change being made by the Secretary of State; I am just saying that, at least first time around, it should be made by primary legislation. It may be that the Minister can put my mind at rest, and I await his response with interest.

[Lord Thomas of Cwmgiedd (CB) [V]]

My Lords, I will speak briefly in support of the eloquent and persuasive speech of my noble friend Lady Finlay in moving the amendment in Motion G1. First, I thank the Minister for his letter of Friday, which makes clear the Government’s wish for a constructive and collaborative relationship with the devolved Governments on state aid control and that the clause does not cut across the power of the devolved Governments to provide state aid or to determine how it is provided; it seeks only to restrict the distortive effects. With those thanks comes one short observation and two questions.

My observation is this: the proposal is very modest and not to the devolved institutions’ liking because, at the end of the period put forward in this amendment, it would nevertheless reserve a matter that the devolved Governments are right in saying is devolved. Of the many strengths of the proposal, it would provide a means for agreeing the regime and ensuring that it does not go forward without any risk of unilateral attack by a devolved institution. Surely the prize of agreement and strengthening the union is worth having.

I now pose my two questions to the Minister. First, the devolution statutes are now all framed based on reserved powers. That means that, if the UK Government have not reserved something, it is devolved. The power to control state aid is not reserved. If it were, these amendments would be unnecessary. This amendment therefore plainly changes the devolved settlements by removing a power that the devolved Governments have and transferring it to the UK Government. In those circumstances, I ask why the UK Government would not work together with them, consult them before the Bill was produced and try to find a common solution to that which I have always accepted as an absolute necessity: a unified state aid control regime. I fear it is an example of Westminster saying that it knows best, rather than working with the devolved Administrations.

Secondly, if the desire was to work together but, at the same time, provide a means of subsidy control, why, when changing the scheme of devolution, was a commitment not made in the Bill to work together with the devolved Administrations to develop the new regime? These questions seek to show that much could have been done to proceed in a way that strengthens the union, for that is the point of these amendments: to ensure that the UK Government work together with the devolved Administrations.

It is therefore necessary to ask the Minister a general question: how serious are the UK Government in their claims that the devolved legislatures and Governments will be fully involved in developing the subsidy regime? There are many important questions, particularly the role of the CMA as an independent regulator and not an adviser to the UK Government. I am grateful to the Minister for his letter and the constructive conversations we have had, but I join the noble Baronesses in asking for these further assurances and hope we receive them.

[The Deputy Speaker (Baroness Fookes) (Con)]

I have received a request to speak from the noble Lord, Lord Adonis.

Parliamentary Constituencies Bill

Lord Thomas of Cwmgiedd Excerpts

Consideration of Commons amendments & Ping Pong (Hansard) & Ping Pong (Hansard): House of Lords
Thursday 26th November 2020 Lords Chamber

[The Minister of State, Cabinet Office (Lord True) (Con)]

My Lords, in moving Motion A, I will also speak to Amendments 2, 6, 7 and 8, on which I shall also beg to move that the House do not insist on those amendments, to which the Commons have disagreed.

Amendments 1 and 2 provide that a boundary review would be carried out every 10 years. The Commons have opted to disagree to these amendments, as eight years is deemed a better balanced and appropriate approach to ensure that parliamentary constituencies are updated sufficiently regularly without disruption to local communities and their representatives.

The Commons disagree to Amendment 6, which proposes a bespoke appointment system for boundary commissioners. The Commons consider that the existing public appointments system and the requirements of Schedule 1 to the Parliamentary Constituencies Act 1986 are sufficient. The public appointment system used to recruit commissioners is robust and has led to the appointment of impartial and effective candidates for decades.

The noble and learned Lord, Lord Thomas of Cwmgiedd, has since tabled an amendment in lieu on this topic, which we will return to in more detail later. However, I wanted to take the opportunity at this point to thank the noble and learned Lord for his constructive and positive approach to engaging with me and officials, and indeed other senior Ministers in the Government, on his amendment throughout the passage of the Bill. It was a model of the approach for a revising Chamber.

We have had many conversations at every stage since this Bill entered the Lords and have thoroughly debated the aspects of the amendment. Even though the Government were unable to accept the noble and learned Lord’s amendments, I hope he has found our exchanges of a good nature and believes that they have resulted in reassurances that made them worth while.

Under Amendment 7, the number of voters in each constituency would be permitted to vary from the UK average by plus or minus 7.5%, which equates to a total tolerance range of 15%. The Commons—the elected House—consider that the existing law on this matter, that of a tolerance range of 10%, is sufficient to ensure equal parliamentary constituency boundaries.

Finally, turning to Lords Amendment 8, this required the Government to make proposals for improving the completeness of electoral registers. The Commons consider that the Government have provided sufficient explanation of action they have taken and are taking to improve the completeness of the electoral registers.

I would like to take this opportunity to pay my respects to the noble Lord, Lord Shutt of Greetland, who so sadly passed away and who tabled the original amendment. It was a privilege to call him my noble friend when he was my Deputy Chief Whip during the years of coalition. In those Quaker values which have so enriched the Liberal party—as it was—and the Liberal Democrats over generations were rooted his principles of straight talking and straight dealing, which we all remember, as we remember his passion for his work and his good humour. He will be sorely missed, particularly by colleagues on the Liberal Democrat Benches.

Since then, the noble Lord, Lord Woolley, who had not previously taken part in the Bill, has tabled a new amendment in lieu. The Government cannot accept this amendment for reasons I have privately explained to the noble Lord, Lord Woolley, but we will no doubt have an opportunity to discuss this further.

As is quite proper, this House asked the Commons to re-examine the detail of this Bill. The House of Commons did so and have returned a Bill to us that is now ready to go to Her Majesty for Royal Assent. The elected Chamber, to which this Bill directly relates, has considered your Lordships’ amendments, and indeed accepted three in relation to the automaticity provisions, and has made its will now known. I therefore urge noble Lords not to insist upon these amendments. I beg to move.

[Lord Thomas of Cwmgiedd (CB) [V]]

My Lords, I begin by thanking the Minister for the courtesy and pleasure, if I may say so, of being able to debate the issues that lay behind the original amendment I put forward. I am extremely grateful to him for the courtesy and the trouble to which he has gone, and to his officials, who went beyond their ordinary tasks even in these most difficult times to help me.

I have put forward today an amendment to the original clause that was carried by this House. It is plain that the original clause would have brought about a better appointment system, but the decision has been made by the other place that they do not agree. As regards the amendment I have tabled today, it deals with a narrow and specific point of some constitutional importance. That is why I have put the amendment forward: to amend the clause on a very narrow basis.

However, I wish to make it clear now that I do not intend to press this amendment to a Division because, in the ultimate analysis, it must be for the other place to accept it. However, given the times in which we live, I think it is important to record the matter formally, because it may turn out to be of great importance in the future. As regards the more general points, they are of very considerable relevance at the present time. Although in what I have to say I will be a little critical of the Government, I wish to make it abundantly clear that anything I say in no way criticises the present Secretary of State and Lord Chancellor. This is a more general point, directed at the Government as a whole, now and for the future.

The amendment today, on this narrow point, has the objective of bringing the provisions for the appointment of the deputy chairman of the Boundary Commission into line with the principles of the Constitutional Reform Act 2005, which changed the position of the Lord Chancellor. Noble Lords may recall that the debate on the position of the Lord Chancellor was an extensive one. There were very detailed discussions between the judiciary, at that time led by the noble and learned Lord, Lord Woolf, and the Department for Constitutional Affairs led by the Lord Chancellor— as he then truly was—the noble and learned Lord, Lord Falconer of Thoroton.

A concordat was reached in 2004, which sets out very clear principles that were embodied in the Bill. Those principles were that the deployment and appointments to posts of judges were for the Lord Chief Justice. In respect of some, the Lord Chief Justice was obliged to consult the Lord Chancellor and, in the case of one or two, obtain his concurrence, but the important point is that the decision was that of the Lord Chief Justice. That was because the Lord Chancellor ceased to have any judicial functions and to be head of the judiciary. That is a basic and fundamental constitutional position. The Lord Chief Justice became head of the judiciary and responsible for judicial deployment and the allocation of responsibilities and—importantly—of cases.

The power of appointment to the post of deputy chairman of the Boundary Commission dates from a time when the Lord Chancellor was a judge and head of the judiciary. It is noticeable in the Act that the powers of the Lord Chancellor did not extend to the appointment of the deputy chairman in Scotland or Northern Ireland, because the Lord Chancellor was not head of the judiciary there. Unfortunately, though I think it is hardly surprising, having been involved myself at the time, this provision was overlooked. There were literally hundreds of posts and duties that the Lord Chancellor had accreted over the centuries; that one or two slipped by is not surprising. It is essential to rectify the position now for two reasons: first, to correct an error and, secondly—far more importantly—because the position of the Boundary Commission has changed. It is no longer advisory and its decisions are not subject to any review by Parliament; it decides and Parliament and the Executive Government carry out the decision. The position, as I made clear on the last occasion, is no different to the selection of someone to decide a case. When a judge decides a case, the matter must be enforced by the Executive and adhered to by Parliament. It is quite clear that the Lord Chancellor could not pick a judge to decide a particular case; it would be wrong.

As I could not understand why the Government were opposing this change, I asked three question that I hoped would elucidate the reasons for the decision. I asked if the Lord Chancellor was satisfied that a decision by him as Lord Chancellor, or by any successor, personally to appoint the deputy chairman would be in accordance with legal principles, given that it would be a decision in which the Lord Chancellor—unless he were a peer, which was of course the case prior to 2005—had an actual interest, as the Commission would be determining the boundaries of the Lord Chancellor’s own constituency. The answer I got was that, in making such an appointment, the Lord Chancellor would have to act within established law principles. It seems clear that the Government accept that there is a personal interest in this matter. My second question was whether it would be susceptible to a legal challenge. To that I got the answer that in making such an appointment the Lord Chancellor would have to act within established public law principles. Thirdly, I asked whether it was consistent with the duty placed on the Lord Chancellor to uphold the continued independence of the judiciary. The answer was that is not inconsistent for the Lord Chancellor to have a role in appointments that involve the selection of one member of the judiciary over another. Indeed, because the Lord Chancellor is still ultimately accountable for senior court appointments, it was considered sufficiently important for there to be ministerial accountability to that extent for the judicial appointment system. The same could be said of these appointments.

--- Later in debate ---

[Baroness Scott of Bybrook (Con)]

My Lords, the noble and learned Lord has been speaking for 20 minutes. Could he now wind up, please?

[Lord Thomas of Cwmgiedd (CB) [V]]

I will be a moment longer. I just want to add one final point—and it is this. One can see the damage done when a country such as China criticises Her Majesty’s Government for going back on a treaty. Its comments speak for themselves.

I will conclude by saying that we should be vigilant for the future. The threat to the rule of law is still there, and there are more matters to come. I hope very much that on future occasions this Government will be much more careful about the independence of the judiciary and the rule of law.

[Lord Woolley of Woodford (CB)]

My Lords, I first apologise to the House and my fellow noble Lords for coming to this debate very late in the day. I am new to the Chamber, as many noble Lords will know, and I would argue that I and many others were thrown off track by the pandemic. I apologise, and for that reason I will not be putting my amendment to a vote—because I respect noble Lords and I respect this House.

However, I will not apologise for wanting to ensure that hundreds of thousands of young people are registered to vote and have a voice in our society. I have dedicated most of my adult life to ensuring that young people and those from black, Asian and minority ethnic communities can be part of our society—and without a vote, you do not have a voice.

Before I go into that, I pay tribute to David, Lord Shutt, who, as the Minister said, was our friend. I knew David more than 20 years ago when I was an activist, just starting out with Operation Black Vote. We had no money—and no money any time soon. I was asked by Stephen Pittam, who was the social and racial justice director of the Joseph Rowntree Charitable Trust, to put in an application. So I did, and I was called to a panel, and David Shutt was the chair. I said to him, “You and I know that Martin Luther King had a dream. But he had more than a dream. He had a plan. And step one of that plan was to politically empower African Americans and white poor people to be in a situation where they are not asking for justice and equality but demanding it. And they demand it by voter registration, by having a strong voice”. In typical Yorkshire fashion, David turned around and said—I hope noble Lords will excuse my language—“You’ve convinced me. Give him the bloody money, and good luck”. And we then began a journey, going out the length and breadth of our nation to register our communities to vote.

Our focus has been on black, Asian and minority ethnic communities where, as many noble Lords will know, the deficit is the greatest. We laid bare about 10 years ago the fact that more than 50% of young Africans in London were not registered to vote. The average for black, Asian and minority ethnic communities is 25%-plus, when the average across the board is around 15% to 17%. The problem that we are facing is not that there is a neutrality in some of our communities towards registering to vote and voting—there is antipathy towards it. People say, “Why should I vote when I do not see our institutions, locally or nationally, looking like us? There is no representation. How are they going to speak for me?” Too many say, “Why should I vote when policies are not addressing the deep-seated racial inequalities and disparities that affect our lives—in housing, education, health and many other areas? Why should I bother?” We as activists tell our communities and young people across the board, “That’s precisely why you should vote—because if you don’t have a voice, you can’t change anything”.

Twenty-five years later, from activist to one of your own as a fellow Peer, I come into this place and, once again, I bump into my old friend David, the late Lord Shutt. He says to me, “Young man, great to see you. We’ve got work to do. Your first step is to come and make a presentation to our committee”—which I did. He said, “Give us chapter and verse on how we can turn this round. Give us the tools to empower black, Asian and minority ethnic communities and young people across the board.” I said to him, “Look, it’s a no-brainer. At the very first instance, we should have automatic voter registration. You give them the insurance number and you make sure they’re registered. At least then our challenge to get them to vote is halfway done; we just need to give them the tools to do it.”

Parliamentary Constituencies Bill

Lord Thomas of Cwmgiedd Excerpts

3rd reading & 3rd reading (Hansard) & 3rd reading (Hansard): House of Lords
Thursday 15th October 2020 Lords Chamber

[Lord Thomas of Cwmgiedd (CB) [V]]

I too add my thanks, and thanks on behalf of the Cross-Benchers, to the Minister for the very courteous way in which he has brought this Bill before the House. Being somewhat inexperienced in these matters, I had not appreciated that this was the first occasion on which he had piloted a Bill through the House. I would never have known that from his magnificent performance. I also thank him for the courtesy he showed me in discussing the various provisions of the Bill in which I was interested. We had very good discussions and they were carried out in a spirit of great courtesy and friendship.

Perhaps I may add two further observations. First, the hybrid nature of these proceedings require me to find a substitute in case the connection from Wales, where the broadband provided is not as good as it should be, fails. I had to ask my noble friend Lord Janvrin to be available to deliver my speech. Having on occasion prepared speeches never to deliver them, I know that that is rather a thankless task, so I am most grateful to him. Secondly, I thank all noble Lords who supported the amendments that I and other Cross-Benchers put forward.

I have two concluding observations. First, thanks are due for the way in which the broadcasting team has so skilfully enabled us to carry through these proceedings. Secondly, thanks are due also to the Bill team and the clerks, and in particular the civil servants in the Cabinet Office, who have been so helpful to me in explaining the intricacies of some parts of the appointments process. Sometimes we do not sufficiently recognise the devotion to duty of those who form our Civil Service and are the backbone of the way in which we run ourselves.

I have one final observation. On the day of Report, I was meant to be at a conference in the United States by videolink. When I explained to those at the conference the reasons for my delay, they expressed the hope that some of the procedures in our House and some of those that we have for altering constituency boundaries might be introduced there and that gerrymandering will be brought to an end. I am sure that this Bill will ensure that we will never have any gerrymandering in the UK.