Economic Activity of Public Bodies (Overseas Matters) Bill

Baroness Chapman of Darlington Excerpts

2nd reading
Tuesday 20th February 2024 Lords Chamber

[Baroness Chapman of Darlington (Lab)]

My Lords, I think the best way to approach a Bill such as this is for me to be completely straightforward with the House. We on these Benches oppose this Bill. We do not support boycott, divestment and sanctions campaigns towards Israel—they wrongly single out one nation and are counterproductive to peace—but the Bill is deeply flawed. It contains draconian powers and fails in its central purpose, which surely ought to be to prevent anti-Semitism.

The Bill prohibits public bodies from making procurement and investment decisions based on their “political or moral disapproval” of a foreign state’s conduct. The Government say that this is an attempt to ensure that all UK public bodies speak, as the Minister said, “with one voice” on international issues. However, the Government seem to think that there are councils, universities, NHS trusts and nursery schools with their own foreign policies, and that this is somehow confusing to our international allies. In fact, the impact assessment points to just three local government pension funds in Scotland that have disinvested from an Israeli bank since 2018. None of them say that this was a political decision or should be taken to represent any kind of political or moral disapproval, so can the Minister explain how the Bill would have impacted on those decisions? Would trustees be interviewed by enforcement authorities, for example?

The naivety of the Bill is to believe that trustees of pension schemes have, until now, been making investment decisions—which have a profound impact on their funds—in response to local boycott, divestment and sanctions campaigns. There is just no evidence for this. The risk is that the Bill will serve only to heighten tensions. I am afraid it plays into the hands of those who spout incomprehensible conspiracy theories and will have unintended consequences. I repeat that Labour has consistently opposed boycott, divestment and sanctions against the State of Israel. We know, and accept, that some campaigners have used the cover of BDS to whip up hate towards Jewish people, to hold Israel to different standards, to question its right to exist and to equate the actions of the Israeli Government with the Jewish people. We know that this happens and it is utterly wrong, but do we really think that the Bill will eradicate anti-Semitism? My fear is that it will make things worse, and it could not be happening at a more sensitive time.

The Bill treats the Occupied Palestinian Territories as though they are, in effect, the same as the State of Israel. This runs counter to decades of British diplomacy under Labour, Conservative and coalition Governments. In 2016, the UN Security Council passed Resolution 2334, requiring every UN member to distinguish between the territory of the State of Israel and the Palestinian territories occupied since 1967. The resolution says that illegal settlements have “no legal validity”, constitute

“a flagrant violation under international law”,

and are

“a major obstacle to the achievement of the two-State solution”.

Not only was the UK involved in drafting this resolution, but the Government’s advice to UK businesses investing in the region makes this distinction clear. Can the Minister tell us what the Foreign Secretary had to say about this Bill? Can she tell us who drafted it? It is so strange that a Bill is being presented that so blatantly contradicts an internationally agreed and long-standing position of this Government.

Then there is the issue of freedom of speech. Not so long ago, we spent days in this House on a Bill to protect the right of individuals to express their views. This Bill does not do anything to legislate against the expression of anti-Semitism, but it does curtail the right to freedom of expression. Clause 4 is clear: decision-makers cannot express political or moral views that might be seen to relate in any way to procurement decisions. This is unenforceable. Councillors are elected officials. They have every right to express their views on moral and political issues—some might say that is their job. They do not, of course, have a right to whip up anti-Semitism and where that happens it must be dealt with, but the Bill will criminalise community representatives expressing views in a free and open way that has been a fundamental underpinning of our democracy for hundreds of years.

I listened to what the Minister said to try to persuade us that this is not the case. I am afraid she is being completely unrealistic and naive. Why does she say, on the one hand, that a council leader can express a view calling for a boycott on their social media or about another council, yet they would fall foul of this legislation should they express that opinion in a different context? What will the likely advice be from a borough’s solicitor to a council leader or a cabinet member who seeks to express such views? I will tell you: it will be to keep their mouth shut. Is that what the Government really want?

The Minister says that the Bill applies only when a councillor acts on behalf of a council. What does that mean? It is naive in the extreme. I do not know whether she has served as a councillor; I have, and I do not see how the Bill’s provisions, as currently written, are going to work. Suppose a council leader attends a local government conference and expresses a view on human rights, modern slavery, tobacco production, the arms industry, animal welfare or the environment in relation to another country. They will be advised not to express that view or to tone it down. That is not the kind of democracy that I think we want to create.

As for universities being within the Bill’s scope, they are not even classified as public bodies by the ONS, and nor should they be. Why are they included? Which university has actually acted—not made a statement but acted—as a result of a BDS campaign? Perhaps the Minister can tell us. We have just legislated to place a duty on universities to uphold freedom of speech and academic freedom. When does an academic speak in an individual capacity and when do they speak as a representative of their institution? This matters. I just do not think that Ministers can properly answer that question—not when they have an enforcement body with an annual budget of £120,000 to £200,000. I suggest that the Minister might need to look at increasing that, because there are likely to be considerably more complaints and vexatious referrals to that body than the one or two incidents referred to in the impact assessment.

This really does matter, and the issue must be properly answered. If not, there will be the most profound, chilling effect. What would happen if a professor expressed at an event a view relating to China, for example—and was paid for by the university as its representative—at the same time as a procurement or investment decision was being made by that institution? It is not clear from the Bill how that would be investigated.

I accept that there have been some BDS campaigns on some campuses where the atmosphere experienced by Jewish students has been damaged by those campaigns. I completely accept that, and it is right that we do what needs to be done to protect those students. However, the Union of Jewish Students is against this Bill. We need to find a better way to tackle this issue. Universities are not public bodies but are included in the scope of the Bill; however, where is the comprehensive list of public bodies we need in order to consider whether any other institutions might be inappropriately included? I have seen a list, but it is nowhere near comprehensive. It is a very odd list, containing some very surprising institutions such as small children’s charities and the like. This makes you wonder whether the Bill is as well thought through as it ought to be.

One final point is the lack of support from the devolved Governments. The Minister says that the Government have no intention of seeking any kind of legislative consent. That is of course the Government’s right—but is it good politics? Is it good for our democracy for the Government to proceed in this way? What conversations has the Minister even had with her counterparts in the devolved Administrations? Can she confirm that the devolved Governments will be subject to the constraints of this Bill? That being the case, can she understand why this would be a problem for them as democratically elected, accountable bodies in their own right? What have they said to her about what they think of the Bill?

Noble Lords will perhaps remember that we on these Benches supported an alternative approach, during the passage of the Procurement Bill. The approach the Government are taking in this Bill is not, therefore, the only option. Public bodies should be able to take ethical decisions, but these should be based on consistent principles applied equally to all countries. However, the Government rejected that amendment, which would have been a far better way to go about dealing with BDS than this Bill is. Why are the Government hell-bent on taking this approach? I think it is because they want to make political capital out of a very serious issue. This is a sad state for a Government to find themselves in—desperate, in fact. The Front Bench in the other place offered four times during the earlier stages of the Bill to sit down with the Government and formulate a more effective approach. That offer remains open. I only hope that the Minister and the Government are listening.

Economic Activity of Public Bodies (Overseas Matters) Bill

Baroness Chapman of Darlington Excerpts

Committee stage
Wednesday 20th March 2024 Lords Chamber

Moved by

[Baroness Chapman of Darlington]

7: Clause 1, page 1, leave out lines 20 to 22
Member’s explanatory statement
This amendment is to seek clarity on when an individual is considered to be the decision maker for the purposes of this bill.

[Baroness Chapman of Darlington (Lab)]

My Lords, it might be helpful to explain that most, if not all, the amendments we have tabled reflect the fact that we find this quite a difficult Bill to amend in a way that would make it work because, as many noble Lords have already said, it is very wide-ranging and quite vague in many of its terms. Our amendments are mostly intended to elicit not a response from the Minister to the amendments as such, but an explanation of the Bill’s intention, so that we are clear, or as clear as we can be, about exactly how the Bill is intended to be interpreted. This group of amendments is more about who the Government wish to catch with the measures in the Bill, and how it will work. Through these amendments, we want to tease out how the Government will decide who will be subject to enforcement action.

Amendment 7 would remove lines 20 to 22 in Clause 1:

“and those references to the decision-maker include, in a case where the decision-maker is not an individual”—

I assume that that means a local authority, a university or some other public body—

“the individuals who in fact make the decision for the decision-maker”.

I am not sure whether the Government want, in Clause 1, to include members of a governing body or councillors serving on a particular committee—we will come on later to definitions of public bodies. Often, people serve in these capacities as volunteers or as inexpert lay members. Are the Government really trying to say that they want those individuals to be held to account in a way that, in other parts of the Bill, they seem to be suggesting the body itself is to be affected? We need to be clear in our own minds which it is.

We would like to understand in what circumstances individuals will be given notices and then fines. I know we will come on to this later, but we do not know the extent of these fines. Will the fines be applied differently to individuals, compared to a council or a university? Pragmatically, we would expect them to be, but how will they be treated differently if they are to be subject to enforcement action? How will the enforcement agency decide? Is there to be discretion as to whether it is holding an individual responsible as the decision-maker, or is the organisation the decision-maker? How will it assess that? Will it look at the individual behaviour of particularly influential senior managers, members of staff or elected representatives? Would the chancellor of a university, for example, be held to account, or the wider organisation; and how will that judgment be made? The Explanatory Notes do not help us with this question in relation to Clause 1. That is why we have also tabled Amendment 55, which asks the Secretary of State to publish guidance on the circumstances in which an individual is the decision-maker under the Bill, and the circumstances in which they are not.

I am not a lawyer, so perhaps the noble Lord, Lord Wolfson, would like to help us out here. When does this corporate liability, if I can put it that way, become an individual liability? The LGA has helpfully given examples of this question arising. I do not know whether noble Lords have had a chance to look at the pre-legislative scrutiny that took place in the Commons. The LGA was very clear about lots of things in its oral evidence, including that some councillors who serve on pensions committees are not particularly expert in managing these funds, but they are very well supported and advised by their officers, and they take their duties very seriously. Even where, say, a newly elected councillor arrives with some grand intention or attempts to argue for some kind of divestment decision, actually, their fiduciary duties, it is pointed out to them, override such concerns, and that does tend to become the view of the committee.

The LGA, because of its experience of how these things work in practice, said in its evidence that any enforcement action should be directed towards the administering authority and not the individual councillors. Can the Minister explain how an enforcement authority will decide whether individual or corporate responsibility applies for a particular decision? The LGA talks about this in relation to judicial review as well, which we will come on to later. The LGA feels that the subject of the judicial review should not be the decision-making authority but rather the enforcement authority, so that it is its decision that is challenged. If it decides not to issue a notice, that can be challenged, but the risk does not reside with the individual councillors.

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[Baroness Chapman of Darlington (Lab)]

What the Minister is saying is genuinely quite helpful, but I am just trying to apply this to my experience of the real world. If a councillor, say, were to make a statement or cause something to happen at a conference or something like that, the council would be held responsible as a public authority for the actions of that individual. The trouble with that, in a way, is that that would then influence the advice, guidance and training that is given to elected individuals, and then you would get the chilling effect that we are all so concerned about. Just to make sure, have I actually understood that correctly? Is that what the Minister was explaining to us?

[Baroness Neville-Rolfe (Con)]

I think that sounds right but, if I may, I will clarify if I got that wrong. To some extent, it is important in Committee that we actually understand what is happening. That is what, in the spirit of the noble Baroness’s question, I am trying to do. Even if a decision were delegated to individuals in a public authority, such as a commissioning board in a local authority, I think it is clear that the fine would be imposed on the public authority, not the individual.

I should briefly address why universities need to be in the scope of the legislation in response to my noble friend Lord Johnson, the noble Lord, Lord Hannay, and the noble Baroness, Lady Fox. We will come back to this on later amendments. It is an area of particular interest to a lot of noble Lords, not least because of the huge contributions people in this House make to the university sector.

However, the fact is that universities are a frequent target of the BDS movement, and some student unions —to come back to that point—have passed motions pressurising their universities to divest from Israeli companies. The Bill will ensure that universities cannot implement such policies in response to pressure from their student unions, as that would be divisive and could potentially contribute to rising anti-Semitism on university campuses, which is a concern.

[Baroness Chapman of Darlington (Lab)]

The Minister raised it—can she give us one example of where a university has ever succumbed to such pressure from its student union?

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[Baroness Neville-Rolfe (Con)]

I think I used the word “pressure”. Certainly, I was reading “pressure”, but perhaps I blurred the wording and said “pressurised”. I could equally have used “influenced” or some other word. I was trying to explain what we were getting at on the education side of things.

I have a couple of examples of student union pressure, which I mentioned earlier. Warwick student union held an all-student vote in 2020 to pressure the University of Warwick to fully divest from all unethical industries and release all investments. That included divesting from companies in support of a boycott of Israel, and divesting from international companies that are complicit in violations of Palestinian rights. There was also the example of Sussex University, which I mentioned a little earlier.

[Baroness Chapman of Darlington (Lab)]

The thing is, though, as we are teasing out, is it not right that the Bill would not stop Warwick University student union from passing a motion in that regard? It would stop the university from acting on it, but no university has ever acted on these things. That is why we are all scratching our heads a little about what we are going to get from the Bill. It was a manifesto commitment—we understand that—but it is not our fault if the Government cannot turn their manifesto commitment into a usable piece of legislation.

[Baroness Fox of Buckley (Non-Afl)]

On the Warwick University point, for clarification, the other important thing that happened there was that Warwick University academics refused to sit on a panel discussing the issue of Israel, and so on. That was led by academics. It would not be affected by the Bill. The Minister can say, “Oh, that’s okay, it won’t be affected by this Bill” but that has had a much more damaging impact on the debate around Israel in Warwick University than anything that a few people at the student union did and that the university authorities did not act upon. What the university did not do was support those Jewish students and the organisation that organised that debate, and it let the academics carry on. The question of what the Bill will and will not do, and who will be held responsible, is what we are trying to clarify in this Committee.

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[Baroness Neville-Rolfe (Con)]

I thank all noble Lords, including the noble Baroness, Lady Deech, for their interventions. I observe that, obviously, the Bill will make this boycotting activity by student unions almost pointless. But I say to the speakers that this is a group about decision-makers, and we are ranging widely into the debate about the exact involvement of universities, although that has been helpful in informing the next stage of this Committee.

Returning to decision-makers, perhaps I could just say in conclusion that I trust that this addresses some of the concerns of noble Lords and the noble Baroness. My officials will provide further clarification in the Bill’s Explanatory Notes, as requested by the noble Lord, Lord Wallace of Saltaire. I hope, in the light of the explanations I have given, the noble Baroness will feel able to withdraw her amendment.

[Baroness Chapman of Darlington (Lab)]

My Lords, that was probably a bit more helpful than I had anticipated, in that it fleshed out some of our really quite fundamental concerns. The noble Baroness, Lady Deech, made a very powerful case for why action is needed to prevent some of the antagonism and fear, and those activities that have happened on campuses and elsewhere that we all want to prevent. But this Bill does not do it: it deals only with boycott and divestment decisions. It probably brings into scope people and decision-makers that the Government did not have in mind.

The idea that people who want to campaign on these issues will suddenly stop doing so as a consequence of the legislation is fanciful because, as the noble Lord, Lord Mann, said in his Second Reading speech, they will just change the target from public authorities to others. It will not deal with some of the unpleasantness and the atmosphere on campus. That will not be assisted in any way, and the way the Bill is drafted might actually make things worse. It will not deal with campaigns to prevent certain events or not to have certain speakers. Those things are completely outside the scope of the Bill. We are focusing on universities to make this point, but similar things could be said about local government.

I am very happy to withdraw my amendment, but I think we are going to end up with this discussion on most of the groups, because the Bill is so unsatisfactory and does not actually fulfil the aims that the Government say they wish to achieve. I beg leave to withdraw my amendment.

Amendment 7 withdrawn.

Economic Activity of Public Bodies (Overseas Matters) Bill

Baroness Chapman of Darlington Excerpts

Committee stage
Wednesday 17th April 2024 Lords Chamber

If my noble friend the Minister is not happy with the amendments I have tabled in this group, I hope that she will consider alternative ways of providing certainty, because certainty is very important; I echo what the noble Lord, Lord Wallace of Saltaire, said on that. Also, I hope that she will look at excluding private sector companies from the ambit of this Bill because I do not believe that they were intended to be covered when the manifesto commitment was made.

[Baroness Chapman of Darlington (Lab)]

My Lords, I am grateful to the noble Lord, Lord Wallace, and the noble Baroness, Lady Noakes, for their amendments in this group. They are incredibly helpful. What we are trying to do here, as the noble Baroness, Lady Noakes, has just said, is elicit some certainty from the Government on behalf of those organisations which might find themselves drawn into the scope of this Bill. Even though they may not consider themselves to be public bodies ordinarily, they might find that they are when it comes to this Bill. We will come later to an argument about whether universities should be treated as public bodies and we feel, as we said at earlier stages, they should clearly not be. But that is not the only area where we feel that the Government have not thought sufficiently about what they are trying to do.

Amendment 11 from the noble Baroness, Lady Noakes, would, as she explained, apply the definition in the Freedom of Information Act. That would settle this to a large extent, in that we are clear about who is and who is not subject to that Act. It would be interesting to hear whether the Government are minded to welcome that suggestion because, from what the Minister has said on previous occasions, all the instances that she has referred to as justifying the need for the Bill would probably be covered. I am not sure why the Government do not just welcome that, to be honest; it does not answer all of our problems, but it would go some way towards that.

The introductory speech of the noble Lord, Lord Wallace, was incredibly helpful and his amendments likewise. He concluded by saying he suspects that the Bill is actually performative in nature and worries that the operability is not at the forefront of anybody’s mind in government. I have no idea how true that is, but I share his concern that it is the job of this House to make sure that we do not pass legislation that is unworkable and just causes confusion.

Our Amendment 14 is probing and I accept what the noble Baroness, Lady Noakes, had to say about it. But we are just trying various ways in this group—and in the next, too—to work out which organisations will be subject to these new rules. The example that has been helpfully provided to me by Universities UK was the one that led to the tabling of our Amendment 14.

If the Government get their way and universities are to be treated as public bodies for the purposes of this Bill, although I very much hope not for any other purpose, their activities that we could argue are clearly outside their publicly funded responsibilities—those conducted, perhaps, with private money or are contracted to private companies—would in no way be subject to the rules within the Bill. There is a reference that makes this clear in the Explanatory Notes, but the amendment that we have suggested would put that explanation into the Bill. As I said, it is to probe exactly what the situation would be because, at the moment, universities are not clear about that and it is important that we give them that certainty.

An example was suggested to me by Universities UK. It is hypothetical but not so outlandish that this situation is not happening very frequently. I declare an interest as chancellor of Teesside University. Here is the hypothetical example: university A is considering a proposal to set up a transnational education partnership in country X. This could involve a partnership with a commercial or state entity in country X and the university board must consider a range of proposals. According to the Higher Education Code of Governance, governing bodies should

“conduct their affairs in an open and transparent manner”.

It is a fundamental duty of university governing bodies to safeguard and promote the reputation of the institution. As the new partnership would involve a significant investment and carry both financial and reputational risks, the board of university A is therefore asked to take a decision on the proposals.

To support its deliberations, the board would receive a paper covering the following: the potential financial exposure and opportunity of each proposal; underlying social, demographic and economic data that underpins a market assessment; due diligence on potential partners, including reputational factors; and a summary of ethical and reputational concerns relating to country X. All aspects of the paper would be deliberated by the board. Following an extensive discussion of the financial and reputational impacts of the proposals, the board decides not to proceed with the partnership opportunity because, on balance, the risks are deemed to outweigh the opportunity.

Can the Minister explain whether, in this example, the transnational educational partnership described constitutes a private or public activity of a university? Would the fact that the board discussion included reference to reputational and ethical concerns of direct relevance to a higher education institution mean that members of the board could be subject to action under the provisions of the Bill?

How can boards fulfil their duty to safeguard and promote the reputation of their institution if they are not able to openly discuss and consider material facts that could impact on said reputation without fear of legal action, even if those considerations are not the sole basis for the eventual decision? How can boards fulfil their duty to conduct affairs in an open and transparent manner if the very fact of discussing issues of demonstrable and material relevance would be actionable under the provisions of the Bill?

I raise this example to tease out some of the grey areas that we might be forcing universities to consider and because I am worried about the chilling effect this may lead to. I do not think there is a situation in which a university would not consider the reputational impact of a partnership. But I can conceive of a situation where that consideration would not be as open and as widely shared as we have come to expect, in the way that we would like things to be done in this country.

In this group, we would like to understand the Minister’s response to the amendment from the noble Baroness, Lady Noakes, in particular, on whether there might be any other way of making clear who is subject to this. In relation to my Amendment 14, I would like to understand exactly how this will work for organisations—not just universities, but others as well—particularly in relation to the example I raised.

[The Minister of State, Cabinet Office (Baroness Neville- Rolfe) (Con)]

My Lords, I am grateful for the thoughtful contributions from across the Committee. On the first day of Committee, which also touched on the scope of this Bill, we heard from the noble Lords, Lord Collins and Lord Wallace, the noble Baroness, Lady Fox, and my noble friends Lady Noakes and Lord Johnson. We discussed the Bill’s application to hybrid public authorities. Today, we have heard in slightly different terms from the noble Lord, Lord Wallace, my noble friend Lady Noakes and, of course, from the noble Baroness, Lady Chapman. I will try and come back on her essay question if I can.

Obviously, we have carefully considered the points raised in these debates. I would like to expand on our view of the scope in relation to Amendments 10, 11, 12, 13 and 14. As noble Lords have said, the Bill will apply to public authorities, as defined in Section 6 of the Human Rights Act 1998. I would like to explain, in response to the concerns of the noble Lord, Lord Wallace of Saltaire, that “public body” is a general term with no single legal definition. The Bill’s Short Title provides a general indication of the subject matter of the Bill, and it is not unusual for the Short Title to use different terminology from the Bill’s substantive provisions.

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I thank the noble Lord, Lord Wallace of Saltaire, for his research on the distinction between a public body and a public authority. I am unsure which definition of public bodies he was referring to. There are many, but I hope I have been able to explain that the alternative preferred definition of public bodies would broaden the Bill and take it into the private sphere—that is the dilemma.

[Baroness Chapman of Darlington (Lab)]

I am grateful to the Minister, but I am completely unclear about what a public body is after listening to that. Could she explain what a public function is? That might help us.

[Baroness Neville-Rolfe (Con)]

That is a good point and a good question. The noble Baroness also gave a good example. I suggest that I take away the distinction regarding the public function and have a look at it, and that I come back on the long example she raised, which she said had been given to her by Universities UK, on 7 May when we are due to debate the university amendment in Committee.

[Baroness Chapman of Darlington (Lab)]

I sort of accept that, but while my example referred to universities we could equally apply it to other organisations as well. I would not want to see that consideration narrowed just to the issue of universities.

[Baroness Neville-Rolfe (Con)]

I agree with the noble Baroness; that is an entirely fair point. We agree that the Bill is complex when it comes to understanding. I want to make sure that, when I answer questions on things such as public functions, I am giving good information that is thought through and thoughtful. I have tried to explain today why we are using the Human Rights Act. That has advantages, which is why the Government have gone down that road.

I should respond to the point about cultural institutions that the noble Lord, Lord Wallace, raised. Some of them are in scope of the Bill in their public functions only, and I set out earlier a number of factors that courts would consider in deciding whether an act was a public act. The noble Lord also pointed out that the Bill contains the power to exclude bodies in its scope from the ban via regulations. The Government do not currently foresee the need to exclude such bodies, but this power will allow the Bill to evolve in line with government policy.

For all these reasons, I have tried to explain why we have presented the Bill in the way that we have. There is a lot of comfort to be taken from using the Human Rights Act, but I look forward to returning to some of the questions that have been asked. In the meantime, I ask noble Lords not to press their amendments.

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Moved by

[Baroness Chapman of Darlington]

14A: Clause 3, page 2, line 17, leave out subsections (2) and (3)
Member’s explanatory statement
This would remove the regulation making power for Ministers to add exceptions to the bill by secondary legislation. This is to probe when Ministers would expect to use this power.

[Baroness Chapman of Darlington (Lab)]

My Lords, my noble friend Lord Collins is not moving this amendment, but I will do my best as his understudy.

This group is slightly different from the first, but we will probably touch on a number of the same sorts of issues, as it is all about trying to get some clarity. I take what the Minister said about this being only about procurement and investment decisions. Even so, the question of what procurement and investment are in relation to the Bill is something else that we might need to tease out. If an organisation’s primary activity is in another country, as the noble Lord, Lord Boateng, referred to, would the act of withdrawing from that activity be seen as a boycott under the Bill? If the Minister is saying that it would not, that is incredibly helpful information that may well soothe some of the concerns that will be raised in our consideration of this group.

My noble friend Lord Collins and I have tabled the amendments in this group in an attempt to tease out from the Minister exactly what the Government have in mind. I do not think that the public response to the Bill has been quite what the Government may have hoped or anticipated it would be when they embarked on this endeavour. Most public sector organisations are far too busy battling to provide services—often in extremely difficult circumstances—to their patients, students or service users to be following the back and forth of this debate. That serves to re-emphasise the importance of our considerations, and of making sure we do not land them with something that is unworkable and does not achieve the objectives.

Many of us understand what the Government set out to do when they started all this, so with that in mind, we tabled the probing Amendment 14A to discover in what circumstances Ministers anticipate using the power that they are giving themselves, which allows them to change the scope of the application of the Bill through secondary legislation. We are interested to hear what the Minister has to say about why Clause 3(1) and (2) are needed, and how she thinks they will work in practice. These subsections refer to the powers which allow the Secretary of State to remove any of the exemptions that are listed in the Bill, such as the one on national security. I cannot imagine that ever happening, but there is a whole list of exemptions in there—we are very pleased to see some of them. But why is that power seen to be needed? We cannot imagine a circumstance in which any of those exemptions would need to be removed. It seems an odd power for Ministers to take for themselves.

These decisions matter in the scope of the Bill, and they can have a profound impact on our relationships with other nations and our diplomatic efforts around the world, sometimes in incredibly sensitive situations. I have seen no evidence of Foreign Office engagement with, or even support for, the Bill, and it would be a concern if these decisions were to be taken by SI. We all want government to work interdepartmentally and for all decisions to be consulted upon internally in the right way, but we understand that is not always the situation. This concern was expressed at Second Reading, so can the Minister assure us that before any delegated legislation is proposed, appropriate input will always be sought from the Foreign Office?

We have a whole bunch of amendments which are probing—tongue in cheek is too strong a phrase but we could not think of any other way to do it. This is how we do things: we table amendments, discuss them and through that we get a better understanding of what the Government are trying to do. We tabled a handful to make a point—we could have gone on, but we did not—and I will run through them.

Amendment 22 would exempt schools and early years providers from the scope of the Bill. This was tabled with a view to finding out whether the Government intend early years settings to be involved. It comes back to the issue of what is and what is not a public body. Is a private school a public body? Is an independent nursery funded by a government childcare programme a public body? Is a childminder being paid indirectly by the state a public body?

Similarly, Amendment 23 would exempt charities providing public functions. We have heard the example of housing provision, because some housing providers are also charities.

Amendment 24 exempts community interest companies. There are thousands of such bodies up and down the country, engaged in all kinds of activities. Many are responsible for delivering public services, be that in social care, education, the arts or prisoner rehabilitation—virtually every area of activity you can think of. How are they to regard the Bill? What steps should they be taking to educate themselves and find out how to make sure that they do not do anything to make themselves fall foul of the Bill?

Our Amendment 25 exempts sporting bodies. Do the Government really want to get into this issue of sporting boycotts and which athletes should be doing what, where? If a sporting body did not deem that there was to be a boycott, but individual athletes decided that they did not want to take part in a tournament, what would happen then? There is pressure and debate, inevitably, whether it is part of a BDS campaign or not—but how you define what that is, I do not really know. How would that be considered? How could those people make sure that they are not, in any way, falling foul of this legislation?

We have also tabled an amendment asking for a list of public bodies. I was trying to be helpful and to work out the best way of getting this clarity. To answer the earlier point from the noble Baroness, Lady Noakes, it could be a list that the Minister takes the power to be able to amend and add to, although I completely accept that any schedule containing a list would very quickly need to be updated. We would not want to put something in a Bill that would not stand the test of time, but these schedules are amended on a fairly regular basis.

I asked the government website for a list of public bodies, and there is one. It contains 601 organisations. I doubt it is a comprehensive list, but it contains the 24 ministerial departments, 20 non-ministerial departments, 421 agencies and other public bodies, 113 high-profile groups—they are interesting—19 public corporations, including the BBC, and the three devolved Administrations.

I looked through this list and there were some public bodies listed that I thought we needed to discuss a little bit further. What would happen with some of our defence-related organisations? There is an exemption for national security, but how would that be defined in relation to the Bill? Would that need to be something that would be tested in court? The Minister sighs: I can well understand why. There are defence training academies and there are organisations that deal with the media in relation to defence and make decisions about what adverts, and so on, can be used. These are all public bodies that have duties relating to our relationships with other nations, and they could conceivably be asked to make decisions that would fall foul of this legislation.

The Government have not really thought about the implications for some of these bodies. I accept that some of them are probably relatively low-profile, small in scale or inactive. However, our job is to make sure that we make this as future-proof and workable as we can. That is why we have tabled Amendment 54, which asks for a list, because if your name is on a list, at least you can be alerted to the fact that this is happening and you can take the necessary steps to comply.

If not, it becomes very confusing for decision-makers. As we discussed at Second Reading, these will often be volunteers or people who have not had the necessary training and who are not following the proceedings here. We really would not want to criminalise people inadvertently, when the Government are seeking to do something that is really quite narrow and, as the Minister has said, involves mostly local authorities and universities, which could be done in a completely different way.

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[Baroness Neville-Rolfe (Con)]

I am glad that we have focused on an individual example because, in my experience, this always helps us to clarify our own thinking. I think that, if the noble Lord, Lord Boateng, will allow me, I will take the orchestra example away, along with the example given by the noble Baroness, Lady Chapman, work out the right approach and get back to noble Lords, perhaps in discussions outside the Chamber.

We all want the same thing: to make sure that the Bill applies to the right bodies in the right way. That is what we are seeking to do, which is why we started with human rights legislation, which is often a popular start, for good reasons, to legislation. However, we have, as we do, scrutinised the detail of legislation today and have come up with some extremely good questions. It behoves us to go away. I am sure we can find good answers and use them to improve the Bill, which is, as I said when I introduced the Bill, what we are determined to do to get a good Bill that leaves this House in the right place and delivers on our manifesto commitment.

I turn now to Amendment 25, which seeks to probe whether a national governing body of sport that is in receipt of public funding would be in scope of the Bill. It raises some of the same questions and issues that we are going to consider. It is possible that a governing body of sport could be in scope of the Bill. If a sporting body is considered to be a public body under the Human Rights Act, on the basis that it exercises some public functions, the ban would apply only to the public functions exercised by that body, but a sporting body being in receipt of public funding would not in itself be enough for it to be considered a public authority. These bodies play a significant public role.

[Baroness Chapman of Darlington (Lab)]

We have got the public function thing again, which the Minister has referred to frequently. She has clarified that public funding is part of what will determine whether the sporting governing body is a public body, but she said that would be relevant only in the conduct of public functions. I am not clear on this, given that at the end of the previous group we were promised a response on what a public function is. I think the Minister said that she would follow up in writing, but she is relying on that term frequently in her response to this group of amendments, which I do not think is helpful, unless she can say something at this stage about what she considers a public function to be.

[Baroness Neville-Rolfe (Con)]

The noble Baroness is right that we need to use the term “public function” with care and to be entirely clear what it means, but the receipt of public funding is another legitimate issue that we need to understand—and understand the scale as well.

[Baroness Chapman of Darlington (Lab)]

As an example, if a young people’s badminton team were to be taking a tour of south-east Asia and felt it did not want to take part in events in certain regions of China and came under some pressure on this from parents or other groups, how would that be? You could say that enabling young people to engage in sport is perhaps a public function. I do not know. How would that be considered?

[Baroness Neville-Rolfe (Con)]

That example would not be procurement or investment, so it would be outside the scope of the Bill. However, the noble Baroness has raised the point. Sporting bodies can be within scope, as I explained, in procurement and investment decisions. The reason for this is that these bodies play a significant role in public life and it would send a very unhelpful signal if we were to single out governing bodies of sport as an exception to the Bill.

[Baroness Chapman of Darlington (Lab)]

I am sorry to keep on about this, but there is then a need to define procurement. In the example that I am, perhaps tenuously, relying on, there would surely be procurement of transport services, accommodation services, catering services and venues.

[Baroness Neville-Rolfe (Con)]

It seems to me that the issue here is boycotting a sporting event, and that is not a procurement or investment decision—but I have already undertaken to look carefully at these individual examples, because we all want to understand exactly what we are talking about and to come to the right outcome.

Amendment 24 would carve out community interest companies. While it is not inconceivable that a community interest company might perform a public function, neither the purpose nor the structure of a community interest company naturally lends itself to that. It is not, by and large, what the Bill is designed for.

Amendment 22 seeks to probe whether schools and early years providers, such as nurseries, are in scope of the Bill. I can confirm that all publicly funded schools will be captured by the ban when they are performing public functions, and some early years providers will also be public authorities on that definition. Other early years providers may be captured to the extent that they are performing a public function. However, I will take noble Lords’ concerns on that issue away, because I think it comes into the same category as the other two examples we will be looking at.

Privately funded independent schools—and I think this will probably apply to private universities—will be captured to the extent that they perform a public function. However, they are unlikely to perform functions of a public nature in scenarios where they are captured as hybrid public authorities, which we discussed on the previous group. The ban will ensure that publicly funded schools remain shared spaces for all, and the Bill will ensure that schools and early years providers can remain focused on their core duties, rather than being distracted by divisive campaigns promoted by BDS and others.

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[Baroness Neville-Rolfe (Con)]

I am grateful for that point, but I am not sure I entirely understand it, so perhaps I can offer to meet the noble Lord or to write to him and make sure that he gets an answer in good time.

[Baroness Chapman of Darlington (Lab)]

My Lords, I was not expecting this group to elicit quite the debate it did, but it was incredibly helpful and welcome in exposing what the noble Lord, Lord Warner, called “sloppy”. He makes a fair point. The Minister said that she did not like that phrase but, given that we have been unable to agree a definition of a “public function”, unable to elicit a proper definition of “procurement” and have not agreed what a “public body” is by any means, I have to agree with him.

This is not us being mendacious or deliberately creating problems for the Government, although you could argue that is a fair thing for the Opposition to want to do; that is not what we are doing here. Like the noble Lords, Lord Willetts and Lord Deben, we are trying to get to the real nub of how this Bill enables the Government to fulfil the commitments that we all accept they made in their manifesto. We understand that the Government want to stand by those commitments, but we are so concerned that the legislation before us could end up straying into so many more areas. I honestly do not think that when this went into the manifesto, anybody had sporting bodies or schools in mind, yet here we are with the Minister unable to answer some quite straightforward examples, including a very good one from my noble friend Lord Boateng. I regret that.

I agree with my noble friend Lord Collins that, when the Government Whip pops up to try and rescue the Minister from having to take too many more interventions, that is fair enough, those are now the rules, but this place is supposed to be able to spend a bit more time in Committee—

[Baroness Neville-Rolfe (Con)]

I think that is a little unfair. The noble Baroness knows that I am always ready to take interventions and have continued to do so. I am doing my best to do the job that this Chamber does so well. We have used the Human Rights Act definitions and this Chamber has decided that that causes problems. I am sure those are soluble.

[Baroness Chapman of Darlington (Lab)]

I absolutely did not mean any disrespect whatever to the Minister. She is completely right; she has never declined to take an intervention and has been very accessible on every occasion that I have needed her to be so outside this Chamber. The point I am making is that these considerations in Committee intentionally sometimes involve a lot of back and forth, because we are trying to get to the point—trying to understand, to improve and to do our jobs.

This has been a helpful debate. We leave with a few more questions even than we arrived with. I am sure we will come back to some of this in later stages but, for today, I beg leave to withdraw.

Amendment 14A withdrawn.

Economic Activity of Public Bodies (Overseas Matters) Bill

Baroness Chapman of Darlington Excerpts

Committee stage
Tuesday 14th May 2024 Lords Chamber

Moved by

[Baroness Chapman of Darlington]

33: Clause 4, page 3, line 18, leave out paragraph (b)
Member’s explanatory statement
This amendment would remove the prohibition on a person publishing a statement indicating that they would have acted in a way prohibited by Clause 1 if it were legal to do so.

[Baroness Chapman of Darlington (Lab)]

My Lords, I rise to move this amendment with the permission of the noble Lord, Lord Willetts, who, owing to the delay to the start of today’s deliberations, is unavoidably detained at an event being held, I believe, in his honour, so it would have been incredibly rude for him not to be present. Given that I think we are of one mind on this issue around Clause 4, I am very happy to speak to the amendment on his behalf.

There is much to complain about with this Bill, as we have heard in every group that we have discussed so far, but to my mind Clause 4 has to be one of the most egregious, nonsensical and unnecessary clauses in the entire Bill and, for that matter, pretty much any Bill that I have ever been involved with bringing through either House.

When I first read this clause—which talks about statements that a public body may make with regard to whether it will be taking a decision on BDS— I thought, “Ah, what the Government are trying to do here is to stop a public body making a statement that could be interpreted as a threat to commit to a boycott, or to divest”. But that is not right. This is a prohibition on making a statement that you are not going to enter into any kind of divestment or boycott decision. This is extremely odd.

I will give what might be a ridiculous example, but then I think this is a ridiculous clause; I will use it to explain to noble Lords just how crazy this is. The Minister is a stylish lady. I saw her when she walked in tonight and I thought she looked good. She has a very nice handbag with her this evening. It is very smart. I might have thought to myself, “I wouldn’t mind having that handbag away; I think I’ve got an outfit that it could go with”. But I will not do that to the Minister, because it would be a crime.

I can stand here and say that I am not going to take her handbag away with me tonight because it would be a crime and would, quite rightly, cause me to be punished, perhaps lose my job, embarrass the kids and all the rest of it; I am not going to do that to the Minister. I can say that; it is perfectly fine for me to say that about the crime of theft and depriving the Minister of her smart handbag. I can stand here, or anywhere I like, and make that statement. I am not threatening to do anything or saying that I intend to take away her handbag. I am saying that I am not going to remove her handbag because that would be a crime. That is fine for me to say.

I am not able to make an equivalent statement about divestments or boycotts if I am a public body under Clause 4. That is over the top, unnecessary and something that I cannot think we would ever apply to any other crime. We do not apply this to terrorism, child abuse or murder but, for some reason, the Government think it is necessary to put in this Bill that a public body cannot make a statement saying that it will not breach the terms of the Bill. That is extraordinary.

Further, it cannot even be the case under Clause 4 that a public body should be likely to make such a statement that it intends not to break the law. I have never seen anything like this in a piece of legislation anywhere. I am very curious as to the thinking behind it. I wonder whether the Minister could point us in the direction of an equivalent clause in any other Bill, from any period in the history of this fine country. To me, this goes beyond a gagging clause, which I think it has been called. This is thought police. This is saying that, even if it is suspected that a public body is likely to make such a statement, it can be subject to an information notice, to penalties and to unnecessary intrusion. I just do not see why it is needed, even if we were to accept— and we do not—that the approach the Government are taking in the Bill as a whole would be successful.

The last time we met in Committee, the noble Lord, Lord Warner, raised some interesting points about Clause 4. He made a very good speech, but on Clause 4 he was asking the Minister about her statement of compliance with ECHR. It was his view that she may have been misled or ill advised, or that it may not have been correct for her to sign off on compliance, particularly with Clause 4 in mind. He committed to go away and consider that, and I am interested to hear what the noble Lord, Lord Warner, might have to say this evening. I suspect that he may have read the Constitution Committee report that advises that the House may wish to consider whether Clause 4 should be removed from the Bill. I think the committee has a very good point, and we are very much of the mind that Clause 4 should be removed from the Bill. The noble Lord, Lord Collins, has tabled his intention that Clause 4 should not stand part of the Bill.

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[Baroness Chapman of Darlington (Lab)]

My Lords, we are not talking about a statement of intent to boycott; we are talking about a statement that you would have done something but you do not intend to do it. That is the point that we are trying to make.

[Baroness Neville-Rolfe (Con)]

I think that it is necessary to make these points within the framework of the Bill.

I will move on and explain Clause 4, which, in its entirety, is an instrumental part of the Bill. It prohibits public bodies from publishing statements indicating that they intend to engage in activity prohibited by the Bill. That includes statements indicating that the public body would have acted differently if the legislation had not been in place.

I will deal directly with some points that I feel are misconceptions. The clause will not affect the statements of individuals, unless they are speaking as or on behalf of a public authority. The noble Baroness, Lady Chapman, is not speaking for a public authority in her colourful example; I assure her that she would not be in breach of the ban if she were making a statement of intent to boycott. Even when an individual is speaking on behalf of a public authority, the ban applies only to the public authority itself and there is no personal liability for the individual. Thos includes councillors, to answer the question raised by the noble Lord, Lord Davies of Brixton. For that reason, I reiterate—

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[Baroness Neville-Rolfe (Con)]

I am afraid that I am not familiar with that case, but I take the right reverend Prelate’s point. The way I have described this shows that in fact this is limited in intent; free speech is possible in a personal capacity. I will come on to say a little more about that and about decision-makers, because I know that we need to clear up those points and I am conscious of time.

The noble Baroness, Lady Chapman, highlighted that Ministers in the Scottish Government would be captured by this provision. As I have explained, as Ministers in the Scottish Government are public authorities for the purpose of human rights, they do not have ECHR protections in their public functions. It is clearly right that this provision should apply to Scottish Ministers to ensure that communities in Scotland are protected from these divisive statements, and foreign policy is a reserved matter. Additionally, Clause 1 applies only in relation to procurement and investment decisions in the exercise of public functions. Therefore, Clause 4 would not apply to statements made by Scottish Ministers about how they tend to act in their private lives.

[Baroness Chapman of Darlington (Lab)]

Can we be absolutely crystal clear on this? The Government are arguing that a Minister in Scotland, the Mayor of Greater Manchester, Andy Burnham, or the First Ministers of Wales or Northern Ireland could not legally make a statement saying, on behalf of the public authorities they are elected to lead, that they do not intend to break the law because they do not break the law. Clause 4 would prevent them doing that.

[Baroness Neville-Rolfe (Con)]

I am not sure that is right. I will seek advice.

[Baroness Chapman of Darlington (Lab)]

It is important.

[Baroness Neville-Rolfe (Con)]

It may be important, and therefore it is all the more important that the noble Baroness’s question is answered fully and accurately. I have made it clear in answer to the noble Lord, Lord Beith, that as only public authorities are subject to Clause 1, Clause 4 is strictly limited to the actions of public authorities and therefore not individuals associated with public authorities.

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[Baroness Neville-Rolfe (Con)]

As the noble Lord knows, the Bill aims to improve the situation with social cohesion. I note what he said, but we have seen examples of councils, such as Islington, passing motions in opposition to the Bill alongside foreign policy statements about Israel and other countries. While this might not be a breach of the ban, it demonstrates a strong interest in public authorities engaging in BDS campaigns. It could demonstrate that the Bill is already be having its intended effect of preventing public authorities making divisive statements.

The point is that, overall, Clause 4 supports the main aims of the Bill in ensuring that the UK speaks with one voice internationally and has one foreign policy agenda, and that public bodies do not introduce policies in that area that risk dividing communities at this difficult time. Accordingly, for this evening, I kindly ask the noble Baroness to withdraw her amendment.

[Baroness Chapman of Darlington (Lab)]

My Lords, this has been a helpful debate, if somewhat frustrating at times. I do not think that it is good enough to be reminded of social cohesion as a way of trying to entice us into supporting this measure. We all want to work hard to improve social cohesion where there are issues, and I know that the Minister would accept that that is our intention too.

There are fundamental problems with this clause. The Minister herself has said that she is unable to answer some quite basic questions that we have asked, and not for the first time this evening—we have asked these questions before. We have used different examples to try to tease out the answers, but the principal question is the same: who will be subject to this measure and what might the effect of that be? We still do not know the answer to that.

[Baroness Neville-Rolfe (Con)]

With respect to the noble Baroness, I have answered the large majority of the questions, but I said that I would take away the underlying question that she is enunciating.

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[Baroness Chapman of Darlington (Lab)]

I acknowledge that the Minister has done her best to answer the position this evening. But I remember a meeting that we had before Second Reading and asking her about this example of a council leader, which we heard again tonight put very well by the noble Lord, Lord Beith—I think the Explanatory Notes had been amended at that point. We still do not know the answer to that. The officials who were with her said that they would take it away and come back with an answer, but there has been no answer tonight. The Minister will understand our frustration a little.

The noble Baroness, Lady Noakes—what a soldier. She shows up and does this for the Government, night after night, but, my goodness, how unpersuasive she was—she is normally very persuasive and I can normally see where she is coming from. She is doing sterling work, I am sure, but she has not provided us with the answers that we need. Saying that this is about social cohesion will not wash.

Should the Bill pass, should this clause be included, social cohesion could be damaged. What social cohesion needs is communication, open expression of where people are coming from, and relationships of trust to be built up. You cannot build relationships of trust among community leaders, whether they are councillors, leaders of combined authorities or Ministers in devolved Administrations, if they feel, and are said to feel, unable to express their true positions. That is not a situation we should be content to tolerate in this country.

It would be helpful if the Minister could commit to writing to noble Lords about the issues concerning councillors; but they apply to other elected officials too, as we have discussed. If we could have that letter before Report, that would be incredibly helpful.

I beg leave to withdraw my amendment.

Amendment 33 withdrawn.