National Security Bill

Debate between Lord Wallace of Saltaire and Lord West of Spithead

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.

National Security Bill

Debate between Lord Wallace of Saltaire and Lord West of Spithead

Report stage
Tuesday 7th March 2023 Lords Chamber

[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

Debate between Lord Wallace of Saltaire and Lord West of Spithead

Report stage
Wednesday 1st March 2023 Lords Chamber

[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.