National Security Bill

Lord Wallace of Saltaire Excerpts

Consideration of Commons amendments
Tuesday 4th July 2023 Lords Chamber

[Lord Leigh of Hurley (Con)]

I beg to disagree and am happy to offer humility. I note that recently the Labour Party returned a donation from a Mr Ian Rosenblatt which it decided was inappropriate. All credit to it. It happens regularly. This is not a political issue; this a cross-political matter. As I say, every donation is listed, so there is 100% transparency. I welcome my noble friend the Minister’s proposals, which I think are extremely sensible and helpful to this argument.

[Lord Wallace of Saltaire (LD)]

We on these Benches very much welcome the concessions that the Government have made. I disagree with the rather overoptimistic interpretation of where we are from the noble Lord, Lord Leigh. In the last exchanges, the Minister said that the National Security Bill was about national security and not about donations to political parties, but donations to political parties from foreign powers are a matter of national security.

Indeed, in the last Commons debate on this, a number of rather distinguished Conservatives intervened to say how strongly they supported the amendment as put forward by the noble Lord, Lord Carlile, on the last occasion. I recall Sir Jeremy Wright saying that he found it “very difficult to disagree” with anything in the amendment. He is currently on the ISC and was previously a member of the Committee on Standards in Public Life when it was writing its report on public finance.

I have just read a paper on political finance that the Institute for Government has just published. That stresses how rapidly the context is moving and how the law needs to adjust to cope with that. It particularly stresses the extension of overseas voting rights to British citizens who have been resident abroad for a very long time, many of them dual nationals. Checking on where the ultimate source is for those things is going to be extremely difficult and probably impossible, but political parties should be on their guard against undue influence and the suggestions the Government are now making perhaps will help political parties to take further moves in that direction

I was also struck by the speech that David Davis made in the Commons last week about a donor to the Conservative Party who had given £750,000—not a modest donor, even by the terms of the noble Lord, Lord Leigh—who had spoken openly about buying influence and “access capitalism” as part of what he expected. This was a dual national whose fortune appears to have come largely from contracts within a number of post-Soviet states.

There is a problem there, and it requires investigation, and I welcome the Government’s acceptance that there is a problem and that it needs further investigation, and we look forward to reading the text of the amendment that the Government will move in the Commons and to the further work that they will do then—we hope in co-operation with other parties—to last beyond the next election. This is an area where we need to have electoral rules that are agreed by all the participants.

National Security Bill

Lord Wallace of Saltaire Excerpts

Consideration of Commons amendments
Wednesday 21st June 2023 Lords Chamber

[Lord West of Spithead (Lab)]

My Lords, I support Motion A1 from the noble Lord, Lord Carlile, and Motion C2. On Motion A1, I spoke in favour of the previous version of this amendment on Report on behalf of the Intelligence and Security Committee. Our position in the committee remains very much the same: we firmly support the introduction of this clause. Indeed, I cannot really understand why the Government continue to oppose the amendment. It is eminently sensible and the previous version received widespread support across this House. Indeed, as the noble Lord, Lord Carlile, said, it was notable that, apart from the Government Front Bench, not a single Peer across the House spoke against it.

The ISC’s Russia report in 2020 recognised that the UK, including political parties, had welcomed money from Russian elites, and the Government acknowledged that. They have, for example, as part of the Bill increased the sentences for electoral offences involving foreign powers. There is no doubt that protecting our democratic institutions should be the very top priority for the Government and parliamentarians, but the Government have adopted a rather dismissive and worryingly complacent approach to this risk. They claim that they oppose this amendment on the basis that the existing protections within electoral law are sufficient, that the amendment would not work in practice and that it would place an undue burden on grass-roots political organisations. These claims are patently not true.

Current protections within the electoral financing law are demonstrably inadequate. As the noble Lord, Lord Evans, the chairman of the Committee for Standards in Public Life, who is in his place, noted on Report, his committee undertook a major report into the regulation of electoral finance in 2021 and provided a series of recommendations to close several loopholes in this space, all of which were rejected by the Government. The report stated that

“we consider the current rules are insufficient to guard against foreign interference in UK elections”.

One of the many problems the committee identified was the ability of a foreign corporation to create a UK subsidiary with the sole function of receiving and channelling money to a UK political party. Further, as extraordinary as it may seem, unlike charities or companies, political parties do not have to examine the source of funds they receive. This means that it is perfectly possible for companies to make significant donations to political parties despite clearly not making operating profits and therefore with limited explanations of how they can afford such donations and where the money comes from. These factors clearly increase the threat of political parties being unduly influenced by a foreign power.

The report also noted that, since 2018, the Electoral Commission has supported the introduction to electoral finance of risk management principles that are used in anti-money laundering checks conducted by companies. As the noble Baroness, Lady Hayter, suggested on Report, this amendment would introduce such principles and ensure that political parties identify foreign money and potential proceeds of crime, establishing a culture of “know your donor” within parties similar to the “know your customer” approach in the financial sector.

Contrary to the Government’s suggestion, this amendment would not place a significant administrative burden on smaller political organisations, and nor would it be too difficult for political parties to implement in practice. As the shadow Security Minister noted in the other place, the Electoral Commission has stated:

“These requirements could be introduced in a way that recognises the need for proportionality … with different requirements depending on the size of a regulated entity’s financial infrastructure, or the size of a donation”.—[Official Report, Commons, 3/5/23; col. 129.]


Guidance would prevent this amendment, which increases transparency and accountability, becoming a disproportionate burden. The fact that due diligence measures are used in the charity sector and not just by commercial enterprises demonstrates that it would be entirely possible for similar measures to be adopted by political parties.

I find it extraordinary that the political parties currently do not have to check the source of their funding in the same way as charities and businesses—it is extraordinary—and it is inexplicable that our Government or any political party could consider it appropriate to oppose such a sensible and proportionate amendment. It is entirely necessary and it would go a long way to strengthening our democratic institutions, providing greater protection from foreign influence. I am sure that the Government agree that we must protect our democratic institutions from harmful interference and I am sure that, having heard all these arguments, they will change their view—or I hope they will

Moving on to Motion C1, on behalf of the Intelligence and Security Committee—I have been given its approval to speak on this—I am grateful to my noble friend Lord Coaker for introducing this amendment and we fully support it. It is interesting to note that, when a similar amendment was debated in the House, many Peers spoke in favour but only one, on the Government Front Bench, spoke in opposition. It seems to be a trend with these various amendments. Strangely, the same was true in the other place, where many MPs spoke in support and only the Minister opposed the amendment. The Security Minister himself acknowledged the need for the amendment when he stated that an update to the ISC’s memorandum of understanding needed to be made.

Parliament is united in its support for independent oversight of the intelligence agencies; it is only the Government who are seeking to undermine the ability for oversight, for purposes unknown. National security is too important to play party politics with. Members from across both Houses have repeatedly explained the need for this amendment throughout the passage of the Bill, but to no avail.

I intend to do so again to demonstrate the absurdity of the Government’s opposition to it. The ISC’s memorandum of understanding, which sits underneath the Justice and Security Act 2013, outlines its remit and the organisations that it oversees. Its remit encompasses the expenditure, administration, policy and operation of the agencies and four other organisations that form part of the UK intelligence community. As the ISC has made very clear in its most recent annual reports, intelligence and security activities are increasingly undertaken by a wider assortment of policy departments, as the noble Lord, Lord Coaker, mentioned, including those that generally do not carry out national security-related activity, such as BEIS—now the Department for Business and Trade—DCMS and the Department for Transport.

Those teams are not currently listed in the ISC’s MoU. This is solely because, when the MoU was drafted in 2013, they were not responsible for intelligence and security matters. Had they been, Parliament would have included them in the ISC’s remit. Parliament was clear on the remit it wished the ISC to have and the work it wished it to do on its behalf and that of the British public.

Effective oversight of intelligence and security matters can be undertaken only by the ISC. Only it has the security infrastructure to scrutinise effectively those aspects where classified material, such as intelligence, underpins decisions on national security. This is not rocket science—perhaps sometimes it is, but that is a different issue. Intelligence and security matters deal primarily with highly classified information. Parliament established the ISC, supported by security infrastructure such as the appropriate computer systems, storage facilities and vetted staff, to provide independent oversight of classified matters precisely because Select Committees cannot effectively undertake that role. They definitely cannot do it and it is wrong for the Government to pretend that they can.

The sole purpose of the ISC, and the reason Parliament set it up, is for it to hold the Executive to account on behalf of Parliament and the public. Independent oversight in this space is particularly important given the gravity of national security decisions and the significant intrusive powers that the agencies have at the Government’s disposal. The inability for Select Committees to provide effective oversight of intelligence and security matters has already been acknowledged by the Minister on Report.

The ISC’s MoU, which sets out which government bodies it can oversee, is woefully out of date. There is now intelligence and security activity undertaken by government that is outside the ISC’s independent oversight, which means that it is outside Parliament’s democratic oversight. I am sure noble Lords agree that that is unacceptable. In effect, it means that secret activity is being carried out in our name that no one is scrutinising. The ISC’s MoU needs to be updated so that Parliament can ensure that the Government are acting appropriately in the intelligence and security space at all times.

I find it appalling that the Government continue to oppose this amendment. It is hardly controversial. There is no reason to oppose it unless one wants there to be less independent oversight, less transparency and less accountability in relation to classified intelligence and security. Is that really what the Government want? Would they rather keep any problems behind closed doors? If so, we should be very afraid. This is a matter of grave concern. I therefore support this amendment.

[Lord Wallace of Saltaire (LD)]

My Lords, the Commons reason given for disagreeing to Lords Amendment 22 is:

“Because the law already makes sufficient provision in relation to donations to political parties”.


Yet we have heard that the Committee on Standards in Public Life and the Electoral Commission have made it quite clear that they do not believe the current law makes sufficient provision for that. I remind the noble Lord that the Committee on Standards in Public Life and the Electoral Commission, like the Intelligence and Security Committee, are part of the structure of constitutional safeguards in our politics. They are there to remind the Government how the rules need to be kept. A wise Government should accept that advice. When they do not accept it, Parliament should insist that they do.

Student Visas

Lord Wallace of Saltaire Excerpts

Thursday 25th May 2023 Lords Chamber

[The Parliamentary Under-Secretary of State for Migration and Borders (Lord Murray of Blidworth) (Con)]

I thank the noble Lord for that question. The numbers are these. In March 2023, 477,931 sponsored study visas were granted to main applicants, which was 22% more than in March 2022. In the year ending March 2023, almost one-quarter, 24%, of all sponsored study-related visas granted were to dependants of students—149,400—compared with 15% in the year ending March 2022. Our indication is that 88% of those dependant visas were to those undertaking taught postgraduate courses, so the rule changes will have the effect of greatly reducing the availability of the dependency visas to those who might otherwise have used them, and therefore reduce the net intake.

[Lord Wallace of Saltaire (LD)]

My Lords, I declare an interest as someone who used to run the research side of the international relations department at the LSE. We had well over 50 research students while I was there. To my knowledge, all but one returned to their country of origin, or went elsewhere, after completion of their studies, and the one who remained, an Indian, is now teaching in a senior position in a British university. Is this a real problem, or is it part of the muddle of our migration statistics? Should we not be separating students who come here for either one or three years as temporary migrants and distinguish them from permanent migrants? The problem of our current migration statistics is that they lump everyone together, which as a result makes the whole problem look worse than it is.

[Lord Murray of Blidworth (Con)]

I am afraid that I must disagree with the noble Lord: it is a real problem, for the reasons I have just read out to the Chamber, with the statistics demonstrating the increase in dependants attending, in particular those from two countries. The numbers are startling and required action to change the rules, and I am very grateful for the support from the Official Opposition in doing that.

Net Migration Figures

Lord Wallace of Saltaire Excerpts

Thursday 25th May 2023 Lords Chamber

[Lord Murray of Blidworth (Con)]

Clearly, the increase in net migration has been the result of global events, such as the world recovery from the Covid-19 pandemic, and international events, as I outlined in the Statement, including the policy changes introduced as part of the new immigration system at the end of EU freedom of movement. All have had an impact on migration. The Migration Advisory Committee agrees that the discount available to employers employing foreign workers under the skilled worker route is a sensible solution for occupations where there are shortages, at least in the short term. However, no occupation should be on the shortage occupation list for ever. Sectors must therefore present a realistic strategy for ending their reliance on migration before such jobs can be added to the shortage occupation list, and present compelling evidence that they should remain.

[Lord Wallace of Saltaire (LD)]

My Lords, there is not time now, but perhaps the Government could initiate an informed cross-party debate on the long-term issues involved in migration. The pull factors in migration are that we have not been investing enough in education and training, and that companies have found it easier to recruit staff from abroad than to spend money training their own in too many instances. Also, in public health we need to reduce the number of people who are long-term unwell. There are also the push factors—climate change, conflict in other countries and, potentially, expulsion. The Turkish Government are talking about expelling several million refugees. The UK Government might wish to emphasise that we cannot manage migration without active international co-operation with our neighbours and others, which is almost entirely outside the current debate. Can the Government not attempt a constructive effort, to which I am sure other parties would respond?

[Lord Murray of Blidworth (Con)]

I am not quite sure what the noble Lord suggests would result from such a negotiation. Of course it is right that the Government discuss international migration issues on a regular basis. We saw that at the recent meeting of the Council of Europe. We recognise that no single measure will control immigration. As the impacts of temporary pressures become clearer, we will keep matters under review. The Government will continue to strike the balance between reducing overall net migration and ensuring that businesses have the skills that they need. We continue to support economic growth.

National Crime Agency Investigation: Javad Marandi

Lord Wallace of Saltaire Excerpts

Wednesday 17th May 2023 Lords Chamber

[Lord Sharpe of Epsom (Con)]

Yes; I absolutely accept my noble friend’s point. Certainly, in relation to the question that has been asked, it is incumbent on all parties to be vigilant about all donations at all times.

[Lord Wallace of Saltaire (LD)]

My Lords, I am sure that the Minister shares the general concern about maintaining public confidence in the integrity of our electoral process, including political finance. He must be aware that there have been persistent rumours, with a good deal of circumstantial evidence, that there have been flows of money indirectly from the Russian state into Conservative Party funds. So long as that suspicion is maintained and we do not have transparency about what really happened, there will be questions about the integrity of our political process. Should the Government not ensure that there is full transparency about these various reports and publish some of the redacted parts of the ISC’s Russia report?

[Lord Sharpe of Epsom (Con)]

My Lords, we have gone back and forth on this issue on a number of occasions. The noble Lord refers to rumours, but he is prone to starting some. I remind the noble Lord that, as my right honourable friend the Policing Minister pointed out in the other place, an MP from the noble Lord’s party in the other place accepted sizeable donations from somebody who was later identified by MI5 as a foreign agent. Those in glass houses.

Corruption

Lord Wallace of Saltaire Excerpts

Wednesday 26th April 2023 Lords Chamber

[Lord Wallace of Saltaire (LD)]

My Lords, would it not be evidence of the seriousness of the Government in combating corruption if the agencies concerned with it were adequately staffed? Is not one of the fundamental problems of the Government’s approach to corruption and economic crime that the NCA and other agencies concerned with it are inadequately staffed to deal with this?

[Lord Sharpe of Epsom (Con)]

My Lords, the noble Lord will be aware that this subject has come up in discussion during the passage of the Economic Crime and Corporate Transparency Bill. The agencies are adequately resourced. The funding for the SFO is rising —gradually, but it is rising—and I know that people are being recruited into these operations.

Chinese Police Stations in the UK

Lord Wallace of Saltaire Excerpts

Thursday 20th April 2023 Lords Chamber

[The Parliamentary Under-Secretary of State, Home Office (Lord Sharpe of Epsom) (Con)]

My Lords, I share the noble Lord’s concern about this threat to our democracy, but as the Security Minister said in a previous Statement on this matter in November last year, investigations are still ongoing and it would be inappropriate for me to comment any further on operational matters, as to do so could obviously jeopardise future prosecutions.

However, I take this opportunity to reassure the House of the Government’s resolve to protect every community in this country from transnational repression. As regards the internal party aspects of this, it is my understanding—and if I am wrong, I will obviously come back to correct myself—that this individual was prominent in a particular Chinese organisation within the Cities of London and Westminster. Beyond that, I do not think he had any involvement or contact with Ministers, and, as all noble Lords around the House know, prominent politicians are featured in photographs with very many people, most of whom they will not know.

[Lord Wallace of Saltaire (LD)]

My Lords, I recognise that it is difficult to comment on this immediate case. Therefore, I raise some slightly wider questions. China is not the only authoritarian state which attempts to catch up with and influence its nationals here. We all recall the occasion when a member of the royal family of one of the Gulf states was taken off the streets in Cambridge and taken back to the Gulf states. Can the Minister assure us that other states and their behaviour in Britain—including some with whom we are relatively closely allied, such as the Gulf states—are also in scope and that the Government are concerned about that?

Secondly, universities have a particularly sensitive role here—I speak as a former academic. Last year, one vice-chancellor told me that his biggest single problem in maintaining free speech in his university was keeping the peace between his Hong Kong students and his Chinese mainland students. I put that down as a marker for further discussion. The Defending Democracy Taskforce was mentioned several times in discussion in the other place yesterday. I tried to find out exactly what it is covering, how far it is intended to have some cross-party representation and what its plans are. It is very difficult to find out whether it really exists, how often it meets, what it is doing and what its strategy is. At a later stage, could the Minister’s department communicate to some of us what the Defending Democracy Taskforce’s intentions are?

[Lord Sharpe of Epsom (Con)]

The noble Lord raises a couple of very good points. Obviously, any attempt to coerce, intimidate or illegally repatriate any individual will not be tolerated; it does not matter where they are from. The Higher Education (Freedom of Speech) Bill and the National Security Bill both contain provisions to ensure that universities have the tools they need to deal with interference and threats to academic freedom. The noble Lord is quite right to draw the House’s attention to the Defending Democracy Taskforce, which my right honourable friend the Security Minister introduced in the other House in November last year. He has been asked for updates; I have not seen him since those were asked for, but I will make sure that the representations from this House, as well as the other place, are understood. I can also commit that higher education falls within the remit and scope of the Defending Democracy Taskforce, so there will be more to be said on that matter. Noble Lords will also appreciate that there are a number of other areas, including, as I said, the National Security Bill, where we will tighten up our ability to respond to some of these issues.

National Security Bill

Lord Wallace of Saltaire Excerpts

3rd reading
Monday 13th March 2023 Lords Chamber

[Lord Stoneham of Droxford (LD)]

My Lords, I must apologise that my noble friend Lord Purvis cannot be here with us today. He was coming down from the Borders, but he was unfortunately grounded by the winds at UK airports, so I am just standing in to pass on his thanks to the House.

At Second Reading, my colleagues raised concerns that, in many areas, this important Bill was not workable and, in others, seriously undermined civil liberties. However, we would like to thank the noble Lord, Lord Sharpe, who in Committee listened, acted and then brought forward a series of government amendments to address them. My noble friend Lord Marks is also appreciative of the openness of the noble and learned Lord, Lord Bellamy, at the Ministry of Justice. The Bill leaves this House a better one than when it arrived, and it is a testament to the cross-party working that went into it. Of course, some issues remain, and we will continue to press on them.

My noble friend Lord Purvis would also like to thank all Members of the House who have participated, including the opposition team and the officials’ Bill team, for all their support and work during this Bill. On his behalf, I thank our own team, led by Elizabeth Plummer, who marshalled all our work supremely.

[Lord Wallace of Saltaire (LD)]

My Lords, I saw my role in this Bill as representing the research sector to some extent, and I am very conscious—as I am sure the Minister is—of the delicate balance there is between the desirability of close international collaboration and sometimes having to collaborate with those who come from authoritarian countries that are not entirely friendly to us. The representatives of the research sector—the Royal Society and others—look forward to talking with the department about the guidance, which we hope will strike exactly the right balance in this delicate area between what needs to be done and not imposing deliberate bureaucracy.

I am sure that the Minister is aware from what we have seen in Georgia over the last two weeks—where there have been very serious riots against the Government caused by a foreign agents Bill, which is seen as a Russian attempt to gag the Government and the people of Georgia and to block their contact with the western world—that this is a delicate area. It is extremely difficult to get the right balance, and we hope that we have achieved in this House a much better balance than when the Bill was originally drafted.

[Lord Coaker (Lab)]

My Lords, I hope the Chamber will indulge me. I forgot to thank Ben Wood, who is our adviser. I apologise to him for that.

National Security Bill

Lord Wallace of Saltaire Excerpts

Report stage
Tuesday 7th March 2023 Lords Chamber

[The Parliamentary Under-Secretary of State, Home Office (Lord Sharpe of Epsom) (Con)]

My Lords, the amendments in this group clarify the intent of the enhanced tier of the foreign influence registration scheme —FIRS. They ensure the tier remains proportionate, while achieving its national security objectives. FIRS was recommended by the ISC in its 2020 Russia report, and the Government committed in their response to bring forward such a scheme.

The enhanced tier of FIRS is a targeted regime, allowing the Secretary of State to require the registration of arrangements with specified foreign Governments or entities subject to foreign power control where she believes it is necessary to protect the safety or interests of the United Kingdom. The scheme will play a significant role in the deterrence and disruption of state threats activities by those countries, and entities linked to them, which are of greatest concern.

We know that these states will make use of a whole-of-state approach to covert activities, not just relying on traditional routes of intelligence organisations and undeclared agents. FIRS will be essential to gaining a greater understanding of the scale and nature of activity being undertaken for countries and their proxies that pose the greatest risks to UK interests and national security. The penalties for non-compliance will increase the risk to those who seek to engage in covert activities for specified foreign powers, either directly or through specified entities. It forces them to choose between registering openly or facing prosecution should their activities be known to the intelligence community. Finally, it offers potential for earlier disruption of state threats activity, where there is evidence of a covert arrangement between a person and specified foreign power or entity, but it is not yet feasible to bring charges for a more serious state threats offence.

Government Amendments 89 and 100 make clearer that the Secretary of State can narrow the activities requiring registration under this tier. This will allow us to tailor the registration requirements to the threat posed by the country or entity being specified.

I turn now to government Amendments 95, 104, 125 and 133 and supporting amendments. These amendments make changes to ensure that a proper provision is made for offences committed by those in unregistered arrangements, and employees and subcontractors who are carrying out activities under those arrangements, in both tiers of the scheme. The Government do not wish to unfairly criminalise those who reasonably believe an arrangement is registered and have taken all reasonably practicable steps to check that it is. This is particularly the case with employees of an entity which has made an arrangement with a foreign power or specified person, or for subcontractors carrying out activities under arrangements.

These amendments seek to address this issue by enabling a person—for example, an employee—to avoid committing an offence where they can demonstrate that they took all steps reasonably practicable to determine whether the activities were registered, and they reasonably believed that the activities were registered. We consider that in practice this will mean checking the public register or receiving evidence of registration from their employer in the form of confirmation from the registration portal.

Finally, government Amendments 147 and 151 also modify the individuals to whom an information notice may be issued under both tiers of FIRS. There are circumstances where a person may be arranging for another individual to carry out the activity. In these circumstances, it is important for the Secretary of State to be able to issue an information notice to an individual whom they reasonably believe is carrying out an activity pursuant to a registerable arrangement, even if they are not the person who has made the arrangement.

I have considerable sympathy with the aims of Amendment 91, tabled by the noble Lord, Lord Wallace of Saltaire. Wherever possible, Governments should strive to share what they know to reduce the regulatory burden on ordinary people and businesses. However, I believe that the schemes he has listed have different purposes and requirements, with relatively little overlap. Where there is a risk of unnecessary duplication, registration requirements can be targeted to avoid this.

Amendment 106, also tabled by the noble Lord, Lord Wallace of Saltaire, seeks to require the Secretary of State to produce an annual report on the impacts of the enhanced tier, including on international research collaborations. Again, I seek to reassure the noble Lord on this point, as the Government will keep the impacts of the scheme under review.

Amendments 166B and 203A, tabled by the noble Lords, Lord Purvis of Tweed and Lord Wallace of Saltaire, seek to require the Secretary of State to produce guidance within six months of the Act passing, and to prevent regulations made under the scheme being brought into force until three months after the publication of the guidance. Again, I agree with the spirit in which this amendment has been made but, as I will seek to reassure noble Lords, the Government have already committed to producing guidance during the implementation period, prior to bringing the scheme into force.

I come to Amendment 154A in the names of the noble Lords, Lord Anderson and Lord Carlile. This contains reasonable points which would bring certainty to the provisions and the Government support it.

I hope noble Lords will support these amendments.

[Lord Wallace of Saltaire (LD)]

My Lords, I speak to Amendments 91 and 106, which the Minister has mentioned. In this case, I speak very much on behalf of the academic and policy research communities, with which I was professionally engaged for some 40 or more years.

We are concerned not to impose too great a burden on those who are engaged in international research. The Minister will be very well aware of the commitments that have already been made for researchers engaged in international co-operation to provide information to the Government, and the concerns that there have already been, particularly about collaboration with countries such as China and Russia. That information is provided to government, and I remind the Minister that, as a member of a Government who are strongly against adding to bureaucracy and red tape, it should be possible for government departments to share information, rather than require it to be given twice to different departments.

I am conscious that the Home Office has a poor record in this regard; indeed, the entire Windrush affair happened because the Home Office refused to ask other departments for information on whether or not the people concerned had been in this country. This was clearly available at the DVLA, the Department of Health, the national insurance scheme, et cetera. There is a real problem in government about asking for the same information twice. The information asked for indeed overlaps, and I ask the Minister to assure us that the Government will look at this matter again and do their best to make sure that it does not add to the burdens to which those of us who are concerned with international co-operation have to relate.

The Minister will be well aware that the Government are also negotiating to rejoin the Horizon European international collaboration scheme for science, probably the most impressive and important network for international co-operation in the world. All the members of the European Union and the various other countries associated with it are listed as foreign powers, with the exception of Ireland, so this is a live question. I declare an interest: my son, a scientist at the University of Edinburgh, is currently engaged in international co-operation with universities and research institutes—one or two of them government-sponsored and financed—in France, Germany, the Netherlands and the United States. That is a small snapshot of the extent of that collaboration, if one were to go merely to the biology faculty at the University of Edinburgh. I suspect that there are some 30 or 40 other countries with which 100 scientists at the university are involved in various collaborative activities.

The purpose of Amendment 106 is to gain the strongest assurances from the Government that they will look at whether additional burdens are being imposed by the legislation on those who are unavoidably and actively—and desirably—engaged in international collaboration with institutes, universities and other bodies that are part of, or dependent on, foreign Governments in one way or another. We need active assurance on that. If the Minister is able to give that, we will not press these amendments further but I emphasise that it is important that this legislation does not over-add to the requirements to report normal activities. I remind the Minister that we are talking about a country that is determined to become a science international superpower, and that needs to be sure that it does not put obstacles in its own way that deter those in other counties from collaborating as it ensures its security.

[Lord Purvis of Tweed (LD)]

My Lords, I am grateful for the Minister’s response to the amendments I tabled, supported by my noble friend, on the need for the publication of timely guidance on how the schemes will operate. He has been true to his word from the first day of Report and taken away many of the issues raised in Committee and come back with a number of amendments to address them. They relate mainly to the next group and the political tier but, given that my amendments fall within this group, I wish to put on record how grateful I am to him for the way in which he has engaged and responded.

The government amendments have addressed many of the significant concerns of those seeking legitimate activity—I see that the noble Baroness, Lady Noakes, who raised the issue of economic activity, is in her place—and those concerned about human rights. The areas where some questions remain include those we raised on the first day of Report, such as the German Stiftungen and other organisations that will not fall within the scope of the FIR schemes but are nevertheless concerned that they may do so. Much of that will be resolved in the guidance provided to them and therefore, the timeliness of that is of utmost importance.

In Committee I quoted at length from the Government’s impact assessment of the Bill, which suggested that the initial scheme could cost up to £48 million and many thousands of people would have to be informed about the scheme’s operation. Given that it is to be welcomed that the Government have reduced the scope of that, I am not sure what status the impact assessment now has. I should therefore be grateful if the Minister told us whether the guidance to be provided will also be informed by some revision of the impact assessment.

There will be businesses wanting to carry out legitimate activity that have to operate under a set of rules in the current regulations on countries at risk of money laundering or financing terrorism—we have a list of over 30 such countries—and there may now be an enhanced tier under FIRS. There will also be others, making it quite a complex environment for businesses operating in the political sphere.

--- Later in debate ---

[Lord Sharpe of Epsom (Con)]

I thank noble Lords for their contributions to this short but constructive discussion. I will turn straight to the amendments tabled by the noble Lord, Lord Wallace of Saltaire.

Amendment 91 seeks to ensure that registration under FIRS is not required when the arrangement is registered under other legislative requirements. However, somewhat contrary to the noble Lord’s assertion, I think there is a clear difference between FIRS and the National Security and Investment Act, the academic technology approval scheme and the export control regime. The Government are clear that FIRS fills a gap in our toolkit. It is worth highlighting that the focus of this enhanced tier is to provide scrutiny to UK activities directed by specified foreign powers—it is worth emphasising this; we are talking about the enhanced tier—and foreign power-controlled entities.

We consider that there will be limited circumstances where there is a risk of duplication, but we will work closely across government departments and potential registrants to keep the burden of registration to a minimum and inform our approach to using this tier of the scheme. The Government do not want to impose unnecessary burdens. We have committed to a consultation on the guidance ahead of bringing the scheme into force. If that process identifies risks of duplication, the power to target what arrangements and activities will need to be registered can be used to reduce unnecessary duplication. This will be considered on a case-by-case basis when specifying foreign powers and entities.

[Lord Wallace of Saltaire (LD)]

Can the Minister give us an assurance that he will consult with the academies, the Royal Society and Universities UK to make sure that the element of duplication is reduced to the absolute minimum? When I was in government, we talked about trying to introduce the principle of “Tell us once” when people were in touch with government. In some other areas, that has now been introduced. The principle is a very good one; we do not want universities having to fill in forms unnecessarily widely. If he can assure us that there will be active consultation with those affected, I will not pursue this further.

[Lord Sharpe of Epsom (Con)]

My Lords, I am happy with the reassurance that we are committed to consulting, but I cannot say at this precise moment who we consult with. As I say, if that process identifies a risk of duplication, the power to target what arrangements and activities need to be registered can be used to reduce unnecessary duplication. Again, I stress that we are talking about the enhanced tier of the FIR scheme in the National Security Bill so, if there is a little bit of duplication, I am sure he will understand that in the context of the overall Bill.

Amendment 106 tabled by the noble Lord, Lord Wallace, would require the Secretary of State to produce an annual report on the impacts of the enhanced tier; the noble Lord, Lord Ponsonby, also questioned me on this. I reassure both noble Lords that the Government recognise the importance of keeping the impacts of the scheme under consideration. Clause 82 already requires the Secretary of State to produce and lay before Parliament an annual report every 12 months after the scheme goes live. The legislation will also be subject to the usual post-legislative scrutiny process, which will consider how the scheme has worked in practice and how far its objectives have been met. I therefore ask that the noble Lord does not press this amendment.

Amendments 166B and 203A tabled by the noble Lords, Lord Purvis of Tweed and Lord Wallace of Saltaire, seek to require the Secretary of State to produce guidance within six months of the Bill passing, and to prevent regulations made under the scheme from being brought into force until three months after the publication of guidance. In answer to the noble Lord, Lord Purvis, I say that the Government recognise the importance of ensuring guidance for the public to support the implementation of the scheme. However, it is important that there are not undue restrictions placed on the development of this guidance, to ensure that the guidance produced is clear and targeted to those complying. I can say to him that a revised impact assessment is required before Royal Assent, so that will be forthcoming. He also raised the point about the German Stiftungen. If he bears with me, we will address this directly in the next group. I will also go further: the Government have committed to establishing expert panels to produce sector-specific guidance on compliance with FIRS. With that, I think I have answered all the questions.

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[Baroness Hayter of Kentish Town (Lab)]

My Lords, I have my name on a number of amendments in this group. I will start by saying, which I had not prepared to say, that when the Minister looks at the speech he has just made, I think he will find that there were some drafting errors—I hope there were—at the beginning. He said that FIRS would apply now only to a foreign Government. I think he said that twice and afterwards went on to talk about a foreign power. He knows very well why I pick up on the difference because one of my ongoing concerns is about the definition of a foreign power, which includes political parties. I hope that was just an oversight because I think that this captures political parties as well as foreign Governments.

There are two or three points I want to make very briefly but before I go on, I want to add my thanks for what the Minister has done, not only in the incredible change. The Minister has sent me the Keeling schedule that shows that we have ended up with a FIRS that is very different from what we started with. I should declare my interest, as I sit on the board of the ABI and it is very content with where we have got to. It did however make the point that this is no way to make a sausage—I have to say that they were not its words; it was far more polite. The way it started was not the best way to make legislation. The ABI and others are very content with where we have got to, and it is right to record that we have ended up with something very different, so I thank the Minister.

My name is on three amendments. I will not press Amendments 114 and 121 in my name and that of the noble Lord, Lord Carlile. But on Amendment 115 I am second to the noble Lord, Lord Sharpe, and I think it is an indication of the approval of what he has done that one of the delete clause amendments is in his name—only because he got there first because I was about to do that. I think it is a symbol that we do it.

I have that one remaining query about a foreign political power that happens to be in government engaging with any of us or councillors or parliamentary candidates, even on internal, party-to-party issues, using an intermediary such as the conference arrangement. I have looked at the draft regulations again as the Minister helpfully said. There is no de minimis there, even if they pay £1,000 to a conference organiser to book the stall at a Labour Party conference or a Tory Party conference—I am sure they have stalls; I have been to their conference and they do in the same way as we do. There is no de minimis for a political party abroad seeking to engage with a political party or anyone else here using an intermediary which is simply a facilitator. Therefore, I wonder whether there is a possibility of looking at the guidelines or the forms. There will be a contract. It may be only for £1,000 but there are the implications of having all that to be declared. I am not saying that simply because we have stalls at our conference, it could happen to the Government as well. It captures things that I know the Minister never intended. I know that at the moment he will not give me an answer and a promise written in blood, but some acknowledgement that there is a small ongoing problem would be very helpful. For the moment, I think we have ended up in a much better place than we started.

[Lord Wallace of Saltaire (LD)]

My Lords, I will speak to Amendment 166A in my name. I also thank the Minister for the way in which the Bill has been discussed and amended between Second Reading, Committee and Report. It is a model of the way in which the Lords should operate, and we all appreciate the way in which the Minister and his team have responded to reasoned criticisms as we have moved forward.

Amendment 166A merely draws attention to some of the definition problems we have all struggled with, wanting to catch all the problems but not to overload the necessary and highly desirable international co-operation with other Governments and other countries, many of which are governed in ways we do not entirely approve of. As somebody who used to work for an international think tank, I am particularly concerned with the opacity of the funding of some of our political think tanks, which as charities do not have to declare their revenue.

In the United States there is much concern with the extent to which some foreign Governments, in particular the Gulf states, put enormous amounts of money into institutes operating as political think tanks, intending to influence and therefore reshape the American political debate. Although that is outside the scope of the current Bill, I and others are much concerned to insist that there should be much greater transparency about the funding of think tanks that set out to deliberately influence the way in which our politics take place.

That is an example, but we all know that there will be a substantial grey area between direction and influence, which we and the Minister have all grappled with. We are not entirely sure that we can draw the line clearly as we go. This amendment asks the Government actively to keep under review and to consult on where that line needs to be adjusted as we move forward in implementation. I hope the Minister will respond in that way.

[Baroness Noakes (Con)]

My Lords, I got involved in Committee—my only appearance on the Bill—because of concerns brought to my attention about the impact of the registration scheme on huge swathes of ordinary, everyday business and commercial activity. I was much encouraged that at that stage my noble friend the Minister said that this was under review. I am more than pleased with the actual outcome. I know that once a Bill has been published it is very hard for the Government to do a radical overhaul, so we have to pay tribute to my noble friend the Minister and the Security Minister in the other place for having the courage to say that what we started with would not work well enough and to come back with such a significant set of revisions on Report. I thank him again for all he has done to achieve this.

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The ISC is an important committee and becoming ever more so. As such, its MoU needs updating. It is a simple request which the Government are resisting for no good reason. It is an increasingly disappointing and concerning response. At a time of higher levels of national security concerns and increasing and changing threats, the Government refuse to give the ISC—our parliamentary oversight body—the updated remit that it needs and requires. Therefore, I ask noble Lords to support the memorandum of understanding put forward in Amendment 193. It is a sensible amendment requiring the MoU to be updated and, as such, I would have thought the Government would have accepted it.

[Lord Wallace of Saltaire (LD)]

My Lords, my name is on Amendments 192 and 194. I also support Amendment 193. I remind the Minister that the Conservative 2019 manifesto states:

“We will protect the integrity of our democracy, by introducing … measures to prevent any foreign interference in elections.”


This Bill partly does that—not in my opinion sufficiently, but it takes us some way in this direction. There are questions of transparency and of accountability, about which the noble Lord, Lord Coaker, has just been speaking, and broader questions about public information and public education into the nature of the threat and the experience which we have so far had of that threat.

I remind the Minister, that paragraph 47 of the Russia report has as its heading, “Lack of retrospective assessment”. It says:

“We have not been provided with any post-referendum assessment of Russian attempts at interference … This situation is in stark contrast to the US handling of allegations of Russian interference in the 2016 presidential election, where an intelligence community assessment was produced within two months of the vote, with an unclassified summary being made public.”


It goes on to say that it is

“the Committee’s view that the UK Intelligence Community should produce an analogous assessment of potential Russian interference in the EU referendum and that an unclassified summary of it be published.”

The following chapter talks about the high level of integration for Russian oligarchs within London society and, in particular, political parties—including mentioning penetration of the House of Lords. In effect, it recommends that some of that should be published. Very little has been, which leads to Daily Mail allegations of all sorts of things about the House of Lords, which I suspect are exaggerated, and to a lack of understanding of the nature of the threat. I understand that many of these issues might embarrass the Conservative Party because the penetration, influence and money has most evidently gone to the Conservative Party. However, I can easily imagine what a Conservative Party in opposition would be saying if it were a Labour Government who were refusing to accept the recommendations of the ISC in this respect. Accountability and public education are important. In this respect, they have failed.

On Amendment 194, I take the same view in terms of accountability and public education on the golden visa scheme, and some of that review should be published. We have heard very little about the problem of Chinese rich people in Britain. I remind the Minister that by far the largest nationality of origin of people who have come in under the golden visa scheme was Chinese. The second largest was Russian, and then there were various other nationalities, including a lot of central Asian nationalities. We need to understand a little better what the experience has been, what the sensitivities have been, and what we should learn from that. The Government, in keeping it all under wraps, are failing not only to account to Parliament about what is going on but to tell the public what sort of world we now live in and where there are sensitivities about which we should be concerned. This Bill, as a whole, is trying to sensitise some of the public to the delicacies of our international relations.

Part of our problem in Britain is that we live in a highly internationalised world, with a very large number of rich people in London living among us. My wife and I have just begun to face up to the dreaded problem of downsizing. As we go around parts of London, we see estate agents who tell us that 20% to 40% of the people to whom they have sold houses in recent years have been from overseas—from the Middle East, eastern Europe, Russia and Asia. Again, many of these are highly desirable people buying second homes in London. However, we need to know where there are problems, what we should have been thinking about, what the government have now learned and what they would like the public to understand.

[Lord West of Spithead (Lab)]

My Lords, I support on behalf of the ISC Amendment 193 in the name of my noble friend Lord Coaker. This amendment would update the ISC’s remit to ensure it has the power effectively to scrutinise intelligence and security activity that will be taking place across government under the new national security regime.

The ISC already has the power to oversee much of the intelligence and security activity that will take place. However, as my noble friend Lord Coaker outlined very persuasively, the ISC’s oversight has generally been eroded due to intelligence and security activities often now being undertaken by policy departments which do not generally carry out national security-related activity. He mentioned a list of them and there are many. They were not included in the ISC’s remit and they can—I have to say, they have often—excluded the ISC from looking at the material that we think we should look at. If the Government establish new teams as part of this Bill which sit outside our remit, this amendment will make sure that the memorandum of understanding is updated, and we will be able to have access to do our job for Parliament scrutinising this highly classified material.

Updating the ISC’s MoU is vital, as effective oversight of intelligence and security can be undertaken effectively only by the Intelligence and Security Committee. Unlike Select Committees, the ISC’s purpose is to oversee these highly classified matters which relate to national security on behalf of Parliament. It is therefore the only parliamentary body with the necessary security infrastructure to scrutinise the material that often underpins national security decisions. This issue of having the right material affects the staff. For example, civil servants, who are working with regular access to “top secret” have to have DV. If one looks across government at the moment, I am not sure that that is the case in some departments. They also, including Ministers, have to be read into the STRAP material, and then there is the extra physical security to store “top secret” and STRAP material. It is considerable, and I am not convinced that this is the case across government.

As my noble friend Lord Coaker mentioned, the Government understandably provided a very clear commitment to Parliament, during the passage of the Justice and Security Act 2013, that the ISC’s MoU would be kept updated. Unfortunately—we noted this in our last annual report—this has not been done. They have not stood by this commitment. I cannot understand what difficulty the Government have with this, because I would have thought it was in the interests of the Government to ensure that Parliament has an ability to do this.

I can only repeat the words of the noble Lord, Lord Coaker:

“Each piece of new legislation devolving national security matters away from bodies already overseen by the ISC should come with commensurate expansion of the ISC’s MoU”.


This has been promised by the Government and it should be done. This amendment will seek to do that if, as a result of this Bill, the Government do indeed establish new teams outside the ISC’s current remit. However, as this amendment is linked to this Bill only, it understandably has limited scope; it will not fix the lack of effective oversight in other national security legislation, such as the Telecommunications (Security) Act, where, again pretty much across this House, people argued that the ISC should have the ability to scrutinise that. But it will be a very useful start to help embed the oversight provisions, and for that reason I support this amendment.

National Security Bill

Lord Wallace of Saltaire Excerpts

Report stage
Wednesday 1st March 2023 Lords Chamber

[Lord Anderson of Ipswich (CB)]

My Lords, I declare my connection with the Government of Cyprus, as detailed in the register, and, like my noble friend Lord Carlile, I have spoken to the High Commissioner about this. Clause 97, as the noble Lord, Lord Carlile, has said, is a sufficient and constitutionally appropriate way to apply legislation of this Parliament to the SBAs. In light of that power, like my noble friend I have difficulty in understanding why it continues to be thought necessary for Clause 7, by its definition of “prohibited place”, to apply Clauses 4, 5 and 6 to the SBAs directly.

The noble Lord, Lord Carlile, has said nearly everything, so I will make just two points, addressing what I have seen to be arguments that the Government have sought to make in respect of these clauses. Firstly, there is said to be a partial precedent in Section 10 of the Official Secrets Act 1911—well, what may have been appropriate at the height of empire is surely not appropriate now. Secondly, it is said that these clauses are evidently not intended to apply in the SBAs, as may be seen from the fact that the police powers in Clauses 5 and 6 are vested only in UK officers; yet the phrase “prohibited place” in each of those clauses is clearly defined as including the SBAs. The impression given by those clauses is that powers in the military areas, and indeed in adjacent areas lived in and farmed by local people, are vested in British constables.

That impression may not respond to realities on the ground, but it is certainly unfortunate, and I hope the Minister will do what he can to dispel it, hopefully by accepting these amendments.

[Lord Wallace of Saltaire (LD)]

My Lords, my name is also on these amendments, and I have also spoken with the High Commission; my noble friend Lord Purvis has spoken to both the Minister on the Front Bench and to the noble Lord, Lord Ahmad, in the Foreign Office. If I have an interest to declare, it is that 25 years ago I worked on the Cyprus conflict and discovered a fair amount about the complexities of Cypriot politics—and they are no less complex today than they were then.

I will make a number of domestic comparisons. This is in my experience very much a Home Office Bill; it does not appear to take into account diplomatic niceties or the sensitivities of other states. We have some bitter experience in this country of sensitivities about sovereignty and the attempts by other states to exert legislative authority over this country, in relation to the EU. We are still being told that the European Court of Justice has imperial ambitions, and that we had to regain our sovereignty because it was trying to legislate for us, about our country.

Beyond that, of course, we have US bases in this country. I am very familiar with RAF Menwith Hill, which is close to where I live in Yorkshire, and I know a fair amount about RAF Mildenhall. The Minister will remember that when it appeared that the wife of a US serviceman at RAF Mildenhall was trying to evade British law by claiming diplomatic immunity and then going to the United States, there was a campaign of outrage in the Daily Mail, the Daily Telegraph and others over this incursion into British sovereignty.

I remind the Minister that the agreements between the UK and the United States over US bases in this country are extremely discreet: the details have not been published; they are renewed every 10 years without parliamentary debate; and the two countries negotiate quietly about the conditions under which they operate. They do not involve Congress legislating with reference to these extraterritorial bases in the United Kingdom. Indeed, if Congress were to legislate with reference to RAF Mildenhall, RAF Menwith Hill and other bases, I am sure that the Daily Mail, the Daily Telegraph and others would be outraged on our behalf at this apparent imperial incursion into British sovereignty.

I am conscious that Cypriot domestic opinion has as many elements, from the right to the left, as we have in this country. Of course, it would be a populist, nationalistic, mischievous campaign to provoke a public outrage in Cyprus about this apparent incursion into Cypriot sovereignty, but we in Britain now have some hard-won and bitter experience of how easy it is for populist and mischievous politicians to cause nationalistic outrage.

These references are not necessary. Clause 97 is enough. I hope that the Minister will take advice and consider that the Government should withdraw the references to the sovereign base areas in these other clauses. I repeat: Clause 97 is enough. The good will of the Government of Cyprus, and of the public in Cyprus, is important to this country, and we should not offend them.

[Lord Murray of Blidworth (Con)]

My Lords, this group covers a variety of related topics. The House has heard only about the amendments pertaining to the sovereign base areas, but I will address the other amendments advanced by the Government. The group covers amendments to the meaning of “government department” and changes to Schedule 2 to the Bill, and it deals with the amendments on the sovereign base areas, which I will come to in a second.

I start with a query raised by the noble Lord, Lord Purvis, in Committee. The question at the time was whether the reference to “government department” in the meaning of “Crown interest” in Clause 7 may include the departments of the devolved Administrations. It is the Government’s intention that any reference to “government department” within Part 1 of the Bill, including those falling under “Crown interest”, applies only to government departments of the United Kingdom. This means that we are not seeking to extend the meaning of “government department” to the devolved Administrations. I hope that this goes some way to settling the noble Lord’s concerns.

The Government have also made a number of changes to Schedule 2 to the Bill. In Committee, they made an amendment so that the Bill makes explicit provision that a Schedule 2 production order can be made to a judge without the subject being given notice of the application in advance. Currently, sub-paragraph (d) of condition 5 of the search and seizure powers at paragraphs 9 and 25 of Schedule 2 outlines that this condition may be met if the service of notice of an application for a production order may seriously prejudice an investigation. Without further change, this condition is no longer operationally effective because a warrant for search and seizure would not be granted in instances where the use of a production order more generally, which had been given without notice to a judge, would prejudice an investigation.

This group of amendments therefore closes the gap by bringing condition 5 closer to the equivalent provisions of Schedule 5 to the Terrorism Act 2000, which sets out that the use of a production order would not be appropriate because an investigation may be seriously prejudiced unless a constable can secure immediate access to the material. It is important to stress that it has always been the Government’s position that the use of production orders should be considered in the first instance, resorting to a warrant where such an order is not appropriate to the investigation.

Finally, government Amendment 60 simply makes it clear that Acts of Adjournal made in relation to the production order powers in part 2 of Schedule 2 would be made by the High Court of Justiciary in Scotland. This is already the case within the current drafting, and we seek only to make this clear. Government Amendments 55 and 59 simply add the offences under Schedules 3 and 4—which were added to the Bill in Committee in the Commons—to the list of offences for which the powers of entry, search and seizure in Schedule 2 are not available.

I now turn to the amendments tabled by the noble Lords, Lord Anderson of Ipswich, Lord Carlile of Berriew and Lord Wallace of Saltaire. These amendments seek to remove references to the sovereign base areas from the prohibited places provisions in Clauses 7 and 8 of the Bill. The sovereign base areas are critical for UK defence and include a unique governance structure among the overseas territories given that the administrator, who is also the commander of British Forces Cyprus, has all the executive and legislative authority of the Government of the UK overseas territory.

[Lord Wallace of Saltaire (LD)]

Is the Minister classifying the sovereign base areas as having the same relationship with Britain as overseas territories? I was not aware that the SBAs were formally overseas territories.

[Lord Murray of Blidworth (Con)]

Clearly, the SBAs are a special structure, as set out in the 1960 treaty. As I say, they have a unique governance structure which I have already described. The unique context of the SBAs is precisely why we are including the option to extend the legislation to the SBAs in their entirety.

The thought behind these amendments is that the power in Clause 97 to extend the legislation to the SBAs is sufficient on its own. I understand the thinking behind this. However, these references are quite distinct and achieve different aims. References to the SBAs in Clauses 7 and 8 ensure that harmful activity taking place in respect of prohibited places will be prosecutable under UK law, in UK courts, only where it constitutes an offence under Clause 4. It is important to stress that the offence under Clause 5 cannot be committed in the SBAs, as this clause does not apply outside the United Kingdom. Similarly, the police powers under Clause 6 are conferred only on constables under UK law, and as such cannot be used in the SBAs. This inclusion of the SBAs maintains the status quo, given provisions of the Official Secrets Act 1911, which already cover prohibited places in the SBAs as part of His Majesty’s dominions.

Clause 97, however, creates a power to extend any provision in Part 1 of the National Security Bill, with or without modification, to the SBAs. Should the power be used, the provisions will then form part of SBA law, and this would allow harmful activity to be prosecuted in SBA courts. Removing references in Clauses 7 and 8 to the SBAs would mean that those sites were no longer protected under UK law. That would reduce the protections currently afforded to them under the Official Secrets Act 1911, which will of course be repealed through this Bill. Furthermore, it is critical that these protections are afforded under UK law given that there is no guarantee that an Order in Council would be made so as to extend this part of the Bill to SBA law, leaving those sites potentially without any legislative protection. To reiterate the point I made in Committee—

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[Lord Wallace of Saltaire (LD)]

My Lords, an Order in Council can be made by His Majesty’s Government. I do not understand when the Minister says that there is no guarantee that such an Order in Council could be made. I hope he is not suggesting that the Government might forget to do so.

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[Lord West of Spithead (Lab)]

My Lords, I support Amendment 51, which would help increase the transparency and accountability of our political system. The ISC’s Russia report of 2020 recognised that the UK had clearly welcomed Russian money, including in the political sphere.

The Government have previously assured the House that the protections within the electoral financing laws are “sufficient”. However, as other noble Lords suggested in Committee, there are clear differences between the requirement on companies to undertake due diligence when receiving foreign money and that on political parties, which have no such duties. This would help close the gap.

I note that the amendment requires a political party to publish a policy statement within three months of the passing of the Bill. The Secretary of State also has three months to produce the accompanying guidance. It may be advisable for the Secretary of State to publish the guidance before political parties are required to produce their policy statements. I simply raise that as a practical point. It does not affect my support for the amendment.

As regards the government amendments, it is not clear why they seek to exclude parliamentary proceedings from the definition of political processes, thereby moving them outwith the scope of any new foreign interference offence. I appreciate that the Government have said that it is to clarify that the Bill does not intend to interfere with parliamentary privilege, but I do not see that the answer is to remove the concept entirely.

To commit the foreign interference offence, one needs to conduct “prohibited conduct” which has an “interference effect”. “Prohibited conduct” includes a variety of unacceptable behaviours—from a criminal offence to threatening to damage someone’s reputation or causing financial loss. Surely, it is critical to prevent any foreign interference in parliamentary proceedings which involves a person conducting such unacceptable behaviour. Perhaps the Minister could explain how including parliamentary proceedings in the foreign interference offence would undermine parliamentary privilege, given the need for the prohibited conduct of the offence to apply. Even if the amendment is warranted, could the Minister explain why the Government have not replaced it with wording similar to that in Clause 70, as amended. This refers to interference with

“a Member of either House of Parliament, the Northern Ireland Assembly, the Scottish Parliament”

rather than “parliamentary proceedings”, which would ensure that no gap was created.

[Lord Wallace of Saltaire (LD)]

My Lords, the all-Peers letter which the Minister sent to us on 28 February states clearly and strongly that what we need is in this Bill is

“transparency on which foreign powers are influencing our politics”,

which it states

“is vital to defending our democracy”.

This reasonable amendment fills one of the loopholes left in the Bill. We are all concerned about the integrity of our elections. We are conscious that foreign donations are part of what can undermine that integrity.

The Minister may have had drawn to his attention a letter in yesterday’s Financial Times which points out that the new proposals for a football regulator include among its duties the need to ensure stronger due diligence and checks on the sources of wealth of those who wish to buy or own football clubs. It is anomalous, to say the least, that we should have stronger checks on people who wish to buy British football clubs than on people who wish to give sometimes very large sums of money to British political parties. I remind the Minister that the question of Arron Banks’s very large donation to the Vote Leave campaign is still being litigated in the British courts. We still have no assurance as to the origins of that donation, since he has refused to give one.

I support what the noble Baroness, Lady Hayter, has said, by reminding the Minister that there are now 100,000 British citizens living in the United Arab Emirates—some of whom already donate to British political parties. It would be quite easy for some of those to become intermediaries for the sovereign powers concerned. Other wealthy British expatriates live in Thailand, Singapore or Hong Kong. Their business depends heavily on the Chinese economy and state.

It is entirely desirable, reasonable and appropriate to ensure that British political parties play their part in mitigating the risks of foreign interference in British elections by being required to show that they are conducting careful risk management in accepting donations from overseas. There have been a number of instances in recent years of which we are all aware. Some of them were touched on in the ISC report on Russia. It is clear that such management has not been in place. It ought to be. I hope that the Government will accept this amendment as a means of filling this loophole.

[Lord Evans of Weardale (CB)]

My Lords, I declare an interest as the chair of the Committee on Standards in Public Life. In 2021, my committee reviewed the regulation of electoral finance. I have to tell the Minister that “stringent” was not what we concluded as to the rigour of the arrangements in place. We felt that there were a number of loopholes which could quite easily be remedied. We made recommendations to that effect. Regrettably, the Government decided that they did not wish to accept any of those recommendations; therefore, the loopholes are still there.

I have added my name to Amendment 51 because it is a modest step in the right direction. The rules that apply to the financial services industry and, as appears likely, are shortly to apply to the football industry are considerably stronger than those that apply to our elections. A modest step in this direction would not provide a high level of assurance that money from illicit sources of various sorts might not reach the electoral process, but at least it is a step in the right direction.

It is important that we should take that step because we know that the electoral system in this country and in other western democracies has been under attack. It is vital to maintain public confidence in the electoral system; it is still pretty good. The Electoral Commission publishes regular research on attitudes towards the electoral system. At the moment, we are in a reasonably good place, but it is very important for the health of our democracy that we retain that public support. This is a small step in that direction. I have been scratching my head to work out why, as the noble Lord, Lord Carlile, said, any political party would not support this for the integrity of our electoral system. It is not massively bureaucratic or intrusive. I look forward to hearing the Minister’s reply.

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[Lord Sharpe of Epsom (Con)]

My Lords, I thank all noble Lords who have spoken on this group.

I will start, if I may, by addressing the question from the noble Lord, Lord West, by repeating something that I said in my opening speech; I think it goes some way to answering him. The majority of what we wish to capture in relation to interference with Parliament will be covered by the effect in Clause 14(1)(b)—the limb relating to public functions—as MPs and other officials in Parliament will be exercising their public functions. It is right that we seek to criminalise activity where, for example, somebody is acting for a foreign power and threatens violence to affect how a person exercises their public functions. I hope that answers his question.

In answer to the question from the noble Lord, Lord Coaker, about Amendment 49, let me say that he is completely right. The reference to

“the activities of an informal group”

in this amendment is, as I think noble Lords know, designed to capture interference activities in APPGs by foreign powers. We are seeking to capture interference whether or however any person participates in the activities of these informal groups. We expect that to cover MPs and people external to Parliament and government who participate in the actions of such groups, but we also envisage informal groups to include things such as “friends of” groups. The use of the term “acting in that capacity” ensures that we do not capture things such as parliamentary book clubs but instead focus on those caught, such as the 1922 Committee, although they could also be covered by the public functions limb of the test. I hope that clears this up.

I know that Amendment 51 is a duplicate of a previous amendment, now tabled by the noble Lord, Lord Carlile. The Government do not believe that this amendment is necessary, I am afraid. I was going to quote myself and say again that UK electoral law already sets out a stringent regime of controls, but I am slightly more reluctant to do so after hearing the comments from the noble Lord, Lord Evans. However, we believe that our regime ensures that only those with a genuine interest in UK elections can make political donations and that political donations are transparent.

I will go into more detail on this point, if I may, because I believe that the noble Lord’s ethical matrix is already in existence. It is already an offence to attempt to evade the rules on donations by concealing information, giving false information or knowingly being involved in an arrangement to facilitate the making of an impermissible donation. This provides a safeguard against impermissible donations via the back door. Political parties must already report all donations over a certain value to the Electoral Commission; these are then published online for public scrutiny. Political parties are by law required to undertake reasonable steps to verify whether a donor is permissible and obtain their relevant details for the reporting requirements. Donations that do not meet the permissibility tests or are unidentifiable must be reported and returned to the Electoral Commission, which also produces guidance outlining how the recipient of a donation can undertake these checks.

As I say, UK electoral law already sets out a regime of donation and spending controls to safeguard the integrity of our democratic processes, so only those with a genuine interest in UK electoral events can make political donations; they include UK-registered electors, UK-registered companies, trade unions and other UK-based entities, as well as otherwise eligible donors such as Irish citizens who meet prescribed conditions and can donate to parties in Northern Ireland. Parties and other campaigners are prohibited from accepting donations that are not from a permissible or identifiable donor. The failure to return such a donation either to the donor or, as I just described, to the Electoral Commission within 30 days of receipt is an offence; any such donations must also be reported to the Electoral Commission. The Elections Act 2022 introduced a restriction on ineligible foreign third-party campaigning above a £700 de minimis threshold.

The transparency of electoral funding is obviously a key cornerstone of the UK’s electoral system. All political parties recognise that third-party campaigners and candidates must record their election spending and report it to the Electoral Commission or their local returning officer; that information is publicly available. For transparency, all donations to political parties and campaigners must be recorded and certain donations must be reported to the Electoral Commission; as I said, these include donations from impermissible donors and donations from the same permissible source that amount to over £7,500 in one calendar year. To ensure transparency, donation reports are published online by the commission for public scrutiny.

To register as an overseas elector, a British citizen has to present ID. However, it is a long-standing principle first introduced by the Committee on Standards in Public Life in 1998 that, if you are eligible to vote for a party in an election, you are also eligible to donate to that party. We believe that overseas electors are important participants in our democracy, but it is only right that they should be able to spend in UK elections in the same way as other UK citizens registered on the electoral roll.

I think that this is a reasonably comprehensive set of rules. There may be some debate as to whether it qualifies as a stringent regime but the fact is that donations to political parties from foreign powers, whether they are made directly or through an intermediary, are illegal. Political parties already have a legal duty to check that all donations they are offered are permissible.

In closing, I very much thank noble Lords for engaging so constructively in this debate. I ask the noble Lord, Lord Carlile, not to press his amendment in this group and ask noble Lords to support the Government’s amendments.

[Lord Wallace of Saltaire (LD)]

Before the Minister sits down, I just want to check one thing with him. He said that overseas electors will have to present ID. I was involved in the passage of the now Elections Act, which does indeed provide stronger, more limited ways in which correct ID has to be presented by people voting in person in British elections. However, I do not recall extra requirements around the presentation of ID for people who are resident overseas and wish to vote.

[Lord Sharpe of Epsom (Con)]

I think that I made it reasonably clear that to register as an elector overseas, you must present ID.

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Moved by

[Lord Wallace of Saltaire]

73: Clause 32, page 23, line 31, at beginning insert “Subject to subsection (1A),”
Member’s explanatory statement
This amendment is connected to the amendment to page 23, line 40 in the name of Lord Marks of Henley-on-Thames.

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[Lord Wallace of Saltaire (LD)]

My Lords, this amendment comes with Amendment 75, which is the substantive amendment. I suppose I should declare a certain underlying prejudice as I start: more than 30 years ago, when I was in charge of research at Chatham House, the international affairs think tank, when we worked with departments across Whitehall on foreign policy issues, we found that the Home Office was the most resistant to the idea that foreign interests had to be taken into account. I have a vivid memory of a conference at Chatham House convened on behalf of the Metropolitan Police with police from the Netherlands, Belgium, France, Spain and elsewhere, at which a number of Home Office civil servants stood in a corner of the room during lunch rather than talk to foreigners. I am sure, 30 years later, that the Home Office is far better than that, but I think there is a problem of how the Bill, as it becomes an Act, looks to our closest friends and allies.

The aim of the Bill is to guard against foreign interference in British politics and British life by hostile foreign powers—above all, by China, Russia and Iran, but also other non-democratic states that want to undermine open societies and democratic government. Yet the definition of “foreign power” does not discriminate in any way between the more than 190 foreign powers with which the UK maintains political, economic and social relations, except for Ireland as a special case. I understand that there have been critical comments from within the US Administration and several European Governments. Yesterday, the German party foundations were speaking to my noble friend Lord Purvis about their worries about being caught by the new red tape which this threatens to impose on them.

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I think the noble Baroness has received the letter I sent her today which sought to reassure her that the circumstances where parliamentarians will have to disclose their work with foreign political parties are likely to be narrow: only where a foreign power—including a foreign ruling party—is directing the parliamentarian to influence others.

[Lord Wallace of Saltaire (LD)]

My Lords, may I ask a question of clarification? I understand much more clearly what the noble Lord is saying: governing political parties are in effect acting as intermediaries for the state. However, certainly in the international relations which I have been engaged in over the last 40 years, many think tanks in other states also operate as intermediaries in that respect. In particular the Washington think tanks, which are very close to the Government, act as intermediaries, but foreign-funded ones in other democratic and non-democratic capitals often also do so. Should that not be included in the Bill for the same rationale that he has just given us on dominant political parties?

[Lord Sharpe of Epsom (Con)]

My Lords, ruling parties are the foreign power. As I have tried to be clear and have stressed twice now, registration will be required only where an individual or entity is directed by a foreign power—that is the condition. Therefore, if a think tank was being directed by a foreign power, the answer would be yes. If it was not, the answer would be no.

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[Lord Sharpe of Epsom (Con)]

My Lords, in answer to the question from the noble Lord, Lord Purvis, I cannot make any promises but I will certainly try. In answer to my noble friend Lord Balfe’s question, as I said in my initial answer to him, we have engaged extensively with the German Government.

[Lord Wallace of Saltaire (LD)]

My Lords, I am not convinced by the Minister’s argument. That he has to go back to the single case of Daniel Houghton shows the weakness of the ground on which he stands. We recall that case, which involved a Dutch-British dual national who was uncovered by our allies, the Dutch, with whom, of course, we have a close intelligence relationship as well as a number of other things; it was therefore resolved. No such things have happened with a hostile foreign power. If we have to go back to that case, it simply shows that there is not very much evidence on which the Government can make this argument.

Many of us who know that this is an important Bill and wish it well are concerned about the unnecessary offence given to friendly Governments. The Minister has not assured us that all our friendly Governments have been consulted and are happy with this Bill. I hope that, in informal conversations between now and Third Reading, he—or at least one of his Foreign Office Ministers who actually talks to other Foreign Ministers—will be able to assure us that we will not treat all foreign powers or contact with them on a similar basis.

On that basis, I will not divide the House but I remark that I am unsatisfied with the Minister’s response. I beg leave to withdraw the amendment.

Amendment 73 withdrawn.