Economic Activity of Public Bodies (Overseas Matters) Bill

Debate between Lord Wolfson of Tredegar and Lord Collins of Highbury

Committee stage
Tuesday 7th May 2024 Lords Chamber

[Lord Wolfson of Tredegar (Con)]

My Lords, I will come back to the text of the proposed amendment. I hope it is in order if I use my short intervention essentially to ask the noble Lord, Lord Collins of Highbury, a series of questions. Obviously, he need not reply now, but I just wish to understand how this amendment is meant to work. I will leave the broader points to one side for the moment, although I always want to ensure that the noble Lord, Lord Purvis of Tweed, with whom I often disagree, remains proudly unneutered in everything he wants to say, here and elsewhere.

As I understand Amendment 19 and the proposed clause, it seeks to enable a public authority to publish policy criteria. Those policy criteria, as we see in proposed new subsection (4B), relate to

“disinvestment in cases concerning contravention of human rights”.

The public authority’s criteria have to do two things. First, as the noble Lord said, they “must be applied consistently” to all countries and, secondly, they must be consistent with the guidance published by the Secretary of State, although we are not helped at all as to what that guidance would, might or should be. So let us assume—

[Lord Collins of Highbury (Lab)]

Can I interrupt the noble Lord? I was going to do it at the end, but it might help the Committee. The noble Baroness, Lady Noakes, said that this would create loopholes, and the important point I wanted to make is that there is nothing wrong with public bodies taking ethical investment and procurement decisions. The reason there is nothing wrong in that is that the Government advocate it. As my noble friend Lord Hain said, we have the Government’s current national action plan on the UN Guiding Principles on Business and Human Rights —and by the way, the Minister says in the introduction that the Government firmly believe that

“the promotion of business, and the respect for human rights, go hand in hand”.

So we are being consistent here, in this amendment, with current government policy.

My noble friend read it out; I will quickly repeat that, in current guidance, the recommendation of the Government is to

“continue to ensure that UK Government procurement rules allow for human rights-related matters to be reflected in the procurement of public goods, works and services, taking into account the 2014 EU Public Procurement Directives”—

the noble Baroness, Lady Noakes, mentioned this—

“and Crown Commercial Service guidance on compliance with wider international obligations when letting public contracts”.

So I am not reinventing something; it is there. We have good policy; let us make sure it is reflected in this legislation.

[Lord Wolfson of Tredegar (Con)]

I am extremely grateful to the noble Lord for setting that out so clearly. It brings me to the question I hope he might be able to pick up later, so that I can really understand how this works. We have a public authority, which publishes a set of policy criteria relating to disinvestment in cases concerning contravention of human rights. As he has just set out—and certainly implied by what he just said—it would not be required, for example, to adopt the ECHR in full; it could highlight certain things.

What would happen if a local or public authority decided to say, “We are not going to disinvest or have a policy of disinvesting from countries which do not, for example, allow gay marriage; we will not have a policy of disinvesting from countries that discriminate against women, but we will have a policy, which we will apply consistently throughout the world, of disinvesting from countries that are in control of occupied or disputed territory”? Under the noble Lord’s approach, would that be permitted?

[Lord Wolfson of Tredegar (Con)]

Forgive me, but I think I did mention the guidance right at the beginning of my remarks. Indeed, I made the point that I did not understand that the noble Lord, Lord Collins of Highbury, had identified what that guidance would, should or might contain—so I think we are on the same page.

[Lord Collins of Highbury (Lab)]

Sorry to interrupt, but I thought I did, at the beginning, when I moved the amendment. Sadly, the noble Baroness, Lady Deech, did not refer to my opening remarks when I moved it. I made it absolutely clear that there is a difference between a public body having an ethical investment and procurement policy and an organisation which, as some individuals are trying to do, seeks to target Israel alone, and have standards for Israel that are completely different from those for other countries. I made that absolutely clear.

[Lord Wolfson of Tredegar (Con)]

To be absolutely clear, my question, which I hope the noble Lord will pick up when he responds, is this. My putative public authority has a consistent policy, which it applies consistently to all countries around the world, of not disinvesting merely because a foreign country does not allow gay marriage, or treats women in a discriminatory fashion, but of disinvesting when a foreign country is in control of occupied or disputed territory. Would that be permitted, or not permitted, under the noble Lord’s amendment? I look forward to his answer in due course.

--- Later in debate ---

[Lord Collins of Highbury (Lab)]

This has been an incredibly useful discussion and debate, but this is not a probing amendment. It is an attempt to bring two sides of the House together. I made it very clear in my opening remarks that we oppose the BDS campaigns we have seen. I do not accept them. They are very damaging. I think I made the point that they have sought to target Israel alone, hold it to different standards, question its right to exist—which is wrong—and equate the actions of the Israeli Government with Jewish people, in doing so creating the very hate that my noble friend raised.

To be honest, I feel as if I am in a Catch-22 situation. On the one hand, the noble Baroness, Lady Noakes, says that there are loopholes, but this is not a restrictive, confined piece of legislation, dealing with BDS campaigns specifically. It has much wider implications. Everyone keeps talking about public bodies making foreign policy. No one questions the right of the Government to make foreign policy. The Government’s duty is to speak for the whole country on foreign policy —no one doubts that—but the Government have placed a duty on public bodies to have ethical human rights considerations in their investment and procurement policies.

We will come on to it in other groups, and I know we keep raising these things, but the sad thing is that the Bill damages our foreign policy. It will implicate us in undermining the very resolutions that we have tabled and supported at the United Nations. That is why we are so concerned, and that is why this amendment, far from giving public bodies the responsibility to decide on foreign policy, agrees with this Government when they speak about—I will quote again, because I think it is really important—

“belief that the promotion of business, and the respect for human rights, go hand in hand”.

When it comes to the statement that a Secretary of State may produce as guidance, is it that public bodies “will have” or “must have” regard to it? I have had many debates on previous legislation about what that might mean, particularly over codes of practice, as the noble Baroness knows, so I am happy to enter into legal dialogue about what that means. It is not unusual to require public bodies to follow that sort of guidance, and we can come up with words for that.

The noble Lord, Lord Wolfson, asked questions about the Occupied Territories. We have an existing policy on the Occupied Territories, so if a public body says it will not invest in the Occupied Territories, that is in accordance with the guidance issued by this Government. If it says it is going to ban any investment in Israel, that would be in breach of the code or whatever guidance, because we are against singling out Israel.

Somebody mentioned gay rights. I have been a campaigner for global gay rights for many years, and one of the things I have resisted doing is advocating blanket boycotts because I know that, where we have investment and contacts, the leverage, guidance and engagement we can have can make a big difference. We have changed people’s attitudes through that. The problem with blanket boycotts is that they have the complete opposite effect.

[Lord Wolfson of Tredegar (Con)]

I am grateful to the noble Lord for, I think, giving an answer to my question. My understanding, therefore, is that the answer to my question is yes. The public authority could make the distinction that I identified. In other words, under this amendment a public authority could refuse to trade with Israel on human rights grounds but could none the less trade with Saudi Arabia. That would, as I understand it, be the consequence of the argument. Have I understood correctly?

[Lord Collins of Highbury (Lab)]

No, the noble Lord is not right. That is not what I said. We have guidance about specific investment in the Occupied Territories. That is what the Government issue now. Why is that so confusing?

Economic Activity of Public Bodies (Overseas Matters) Bill

Debate between Lord Wolfson of Tredegar and Lord Collins of Highbury

Committee stage
Wednesday 20th March 2024 Lords Chamber

[Lord Wolfson of Tredegar (Con)]

My Lords, I spoke on Second Reading, and I am grateful to my noble friend Lord Deben for taking the trouble to read my speech. I wait with anticipation to find out the, no doubt very few, points on which we disagree. That will perhaps be for another day, but I look forward to it.

On these amendments I can be brief, because the central point has already been made: that the proposed amendments, especially those in the name of the noble Lord, Lord Wallace of Saltaire, would add complexity and increase the likelihood of litigation; I declare the obvious interest in that respect. The amendments would therefore make the Bill not more precise but less.

I say that for three reasons. First, introducing words such as “primary or sole” is an invitation to litigation. My second short point—forgive the legal geekiness, but we are in Committee—is that a quick search of legislation.gov.uk indicates that that phrase does not appear anywhere else in legislation. “Sole or primary” does, so in case we go forward with this, I would invite the noble Lord to flip it round, so that we put the more general word “sole” first, followed by the word “primary”. That is not my main point, but as we are in Committee, which is the place for geeky legal points, I may have just made one.

Another amendment introduces the word “material”. That is a really problematic word in law, as are words such as “significant”, because we always have the debate about what the opposite of “material” is. Is it immaterial—that is, de minimis? In that case, that is not really, as I understand it, the force of the amendment. “Material” here really means “of substance”, and it is, I suggest, not a good word to use if one is seeking to get that point across.

However, my main point is that this part of the Bill is drafted clearly and that whether we add “primary or sole” or “material”, that would add complexity and invite more litigation.

[Lord Collins of Highbury (Lab)]

I was going to intervene on the noble Lord, but he finished his speech before I could. Maybe we will have an opportunity when the Minister responds to the debate, because the idea that the words “moral” and “political” are not vague stuns me. Who is to define “moral”? That is very difficult.

This is one of the rare occasions in the House when I can honestly agree with practically all the words of the noble Baroness, Lady Fox. I also agree with the words of the noble Lord, Lord Deben. I want to stress that with the amendments, especially those to Clause 1, it is necessary to probe what the words mean, and get a better understanding of them. Even if I do not personally feel committed to the amendments, it is important to use this stage to elicit from the Minister a better understanding of the intent of Clause 1.

I do not want to repeat what the noble Baroness said, but this is not about how we address BDS strategies. The impact of the clause is far wider and encompasses a whole host of things that the Government may not have really intended. Who knows? Clause 1 does not define “political” or “moral”. It is extremely wide-ranging and could cover any decision or consideration that suggests a negative view of an existing, previous or potential policy action or inaction, or other behaviour associated with a Government or any public authority in another country.

As the noble Lord, Lord Palmer of Childs Hill, said, the reasonable observer of the decision-making process test sets an extremely low bar for considering whether a decision was influenced by political or moral disapproval. It does not distinguish between minor or significant influence, and it does not clearly define a reasonable observer. I hope we can use the amendments in this group to probe substantially on these issues.

I say to the noble Baroness, Lady Noakes, that the consideration of financial, reputational, legal, environmental, social, governance and other risks in procurement and investment decisions are often complex and overlapping, and some considerations may be confidential. How are we going to sort all those things out if the Bill becomes law?

The legislation does not require the reasonable person to be someone who is familiar with the subject matter and decision-making processes. Clause 1(4) and 1(6) do not define a public authority in a foreign territory, so it could include state-run companies in some countries. This could result in additional uncertainty where the conduct of a public authority differs from the official policy of a foreign state, and that is a threat to actions in support of persecuted people across the world.

The sweeping approach to Clause 1 will undoubtedly have a chilling effect on public bodies being able to make ethical procurement and investment decisions and take actions that support upholding international law, democracy and human rights. I know I have an amendment later on, so I will not go into too much detail now.

As I mentioned at Second Reading, the Bill is incoherent and it waters down the Procurement Act 2023. That Act sets key objectives covered by procurement, including supporting public benefit, in Clause 12(1)(b), and acting and being seen to act with integrity, in Clause 12(1)(d). The Act also gave a mandate to commissioning authorities to award contracts based on the “most advantageous tender” submitted. That change of words moves away from the previous priority of the “most economically advantageous tender” under which the previous procurement regime existed. What was the intent of that change in language? The intent was to enable contracting authorities to give more weight to award criteria such as decent work and wider social values. Again, we are coming to other amendments, particularly about the environment.

This wide definition, which is covered in Clause 1, is the fundamental problem with the Bill. The Explanatory Notes state:

“Clause 1 prohibits relevant public authorities from having regard to a territorial consideration in a way that indicates moral or political disapproval of a country or territory’s foreign state conduct, when making decisions … This clause is designed to catch both open participation in boycotts”,


which the noble Baroness, Lady Fox, talked about,

“or divestment campaigns, and more subtle ways of singling out countries or territories that could produce similar results”.

As I say, this sweeping approach will have a chilling effect and will impact on public authorities in upholding international law.

A point I want to focus on is that the UK Government have committed to implementing international standards, including the UN guiding principles on business and human rights—the UNGPs—as well as the commitment made in terms of the environment in the Paris agreement. Carrying out effective due diligence is central to public bodies, as state institutions, being able to fulfil their human rights obligations, implement UNGPs and make ethical procurement and investment decisions. However, because the terminology, such as “political and moral disapproval”, is undefined, this will create problems for public authorities when carrying out their due diligence. That is what will be needed in the due diligence process to avoid falling foul of this legislation, when clarity is so lacking.

--- Later in debate ---

[Lord Wolfson of Tredegar (Con)]

My Lords, I associate myself with the words of my noble friend Lord Pickles about the work done over many years by the noble Lord, Lord Mann, for the Government in an unpaid capacity. That work is well regarded and very much appreciated in the Jewish community and, I am sure, well beyond it too.

Turning to Amendment 9, while I understand its focus and purpose, I am not sure that it is necessary in the Bill. In particular, although this is not my area of law, I wonder whether the thrust of the amendment would not actually be covered by existing provisions under the Equality Act. I do not know whether the Minister or her department has thought of that, but, if this were to go forward, that might be another way of dealing with this issue.

On a narrower point, the amendment is also widely drawn. It would seem to cover, for example, a decision to use one halal supplier or one kosher supplier rather than a different halal or kosher supplier. I think that cannot be within the intention of the amendment, although I think it would be caught by it.

I am conscious of the time, but I will end on a slightly different point. The focus of this amendment is that food is sometimes used to drive a wedge between communities. This might be a strange thing for me to say, but I want to pay tribute to Zarah Sultana MP, with whom I probably agree on absolutely nothing but who, with Charlotte Nichols MP, ran a long-standing campaign in Parliament to have kosher and halal food available here. They found a supplier called 1070, which has both kosher and halal certification to provide that food. As a result, I have had conversations over food with people who I might not otherwise have had those conversations with and I found those discussions extremely helpful. I use this, probably very wrongly, to suggest to the authorities that this kosher and halal food be continued, so that we can not only eat together but discuss and speak together as well.

[Lord Collins of Highbury (Lab)]

My Lords, I too associate myself with the comments of the noble Lord, Lord Pickles, because the noble Lord, Lord Mann, has done incredibly important work in tackling anti-Semitism and ensuring that we remove it from all of our civil life. I pay tribute to him.

I will not delay the House too long, but the important thing with these two amendments is expectations. This is the problem with the Bill. While I want to avoid going back, we have made a plea—my noble friend Lady Chapman made it at Second Reading—that we want to co-operate with the Government to implement their manifesto commitment. I am afraid that this Bill goes well beyond that and brings into question other issues.

The noble Lord, Lord Mann, is absolutely right to put these sorts of amendments down, because they address the concerns of the community. People often think when we are talking about this Bill that we are talking about consumer boycotts and consumer choice. No, we are not. It is about decisions over investment and procurement, but those decisions can involve the sorts of things that the noble Lord, Lord Mann, is talking about—and we heard an example from the noble Lord just now.

How we manage expectations is really important. I suspect that, when we go into other groups, we will hear lots of concerns about issues that go well beyond the scope of the Bill. So I hope the Minister understands why the noble Lord, Lord Mann, has put these amendments in. They are to probe, but also to say that there is a problem, there is an issue and the Bill does not solve it.

Crown Dependencies: Contributions

Debate between Lord Wolfson of Tredegar and Lord Collins of Highbury

Thursday 1st July 2021 Lords Chamber

[Lord Wolfson of Tredegar (Con)]

My Lords, the UK has a constitutional responsibility to represent the Crown dependencies internationally. We discharge that responsibility irrespective of cost. As I said, however, the Crown dependencies have been making voluntary contributions since 1987. As these are general contributions in recognition of our overall responsibilities and it is in our interest to represent the whole British family internationally, they are not intended to reflect the exact costs of defending the Crown dependencies or representing them internationally. We are satisfied with the current arrangements.

[Lord Collins of Highbury (Lab)]

My Lords, during the debate on sanctions regulations in February I asked how we would ensure that sanctions apply in full to the Crown dependencies and overseas territories. The Minister’s response was that the Government were

“lending technical support to the overseas territories”.—[Official Report, 8/2/21; col GC 22.]

What has the outcome of that “technical support” been? Is the Minister in a position to confirm the full application of sanctions within the Crown dependencies?

[Lord Wolfson of Tredegar (Con)]

My Lords, as sanctions are a tool of foreign policy, it is government policy for UK sanctions measures to be given effect in the Crown dependencies to make those sanctions as effective as possible. The Crown dependencies apply UK sanctions, including, for example, the Global Human Rights Sanctions Regulations 2020 and the Global Anti-Corruption Sanctions Regulations 2021. The FCDO and Her Majesty’s Treasury ensure robust implementation of sanctions. There is considerable sanctions-related engagement with the Crown dependencies, including meetings and webinars, to make sure that all the sanctions legislation is properly applied throughout the Crown dependencies.