Product Security and Telecommunications Infrastructure Bill

Baroness McIntosh of Pickering Excerpts

2nd reading
Monday 6th June 2022 Lords Chamber

[Baroness McIntosh of Pickering (Con)]

My Lords, I add my congratulations to my noble friend the Minister on so eloquently and effectively introducing the Bill. I, for one, will welcome anything that can improve connectivity, especially in rural areas. Not only is it a fact that local businesses are being held back from participating in and improving the rural economy, but there can also be safety aspects, particularly as regards mobile networks in rural areas where no phone boxes exist and there is a very poor mobile signal.

It is absolutely vital that a high standard of rural connectivity is achieved. Improving digital connectivity in rural areas will boost the rural economy and allow farmers to create jobs, improve their productivity and make full use of new technology to further reduce the environmental impact of food production. But, at the same time, the Government need to get the balance right between making it easier for telecommunications companies and operators to obtain the rights to acquire new sites for digital infrastructure, and to upgrade and share existing sites, and the rights of landowners. As a number of noble Lords have expressed this afternoon, this is an area where the infrastructure is largely borne in rural areas; we have to keep the landowners onside and ensure that the rights they currently enjoy are not reduced.

Will my noble friend therefore look at investigating why, when a number of telephone operators have put masts in very challenged areas of connectivity such as the North Yorkshire moors, these masts are not operational? That is surely extremely wasteful and frustrating, not just for the shareholders and those who have paid to have the masts put in place but even more so for the local residents who are unable to use them. I can give my noble friend and his department examples of this. Will he take this opportunity to investigate to make sure that this will stop immediately and that those masts will be put to good use straightaway in those areas that, he has accepted, are the remaining 5% hard to reach?

I pay tribute not just to my noble friend the Minister but to my noble friend Lord Vaizey, who was a star turn as a witness when I chaired the Environment, Food and Rural Affairs Select Committee. I hope we did throw too many brickbats at him—he acquitted himself extremely well—but his evidence went to show how many obstacles still remain in place. I accept that the Bill is the next in line to improve those, but I thank my noble friend for taking the opportunity to share his expertise with us at that time. I will not go on to say what the fortunes of the chairmen of that Select Committee have turned to, given recent events since I left that position.

There are issues in the Bill that I will wish to explore as it progresses. One of those is the balance between operators and landowners that other noble Lords have alluded to this afternoon. Perhaps it has shifted too far in the interests of the former, to the detriment of the latter. I have heard that the interests of the consumer have been quoted. When the Government looked to introduce the 2017 Electronic Communications Code reforms, changing the way in which new sites were valued, they stipulated that landowners should be paid based on land value, not market value. The Law Commission at the time advised against that change, arguing that it would lead to a fall in rent for landowners and therefore a c in the number of agreements reached between landowners and operators to host digital infrastructure.

Its prediction was absolutely correct. Rents offered to landowners are up to 90% lower for new or renewal agreements made under the new 2017 valuation scheme. Before that code came into force, landowners assessed hosting mobile phone masts in the same way as they would other diversified activity. The rent to be received and terms of the agreement are carefully built into business models or other financial plans such as a pension or loan. For the most part, I would hazard a guess that this is affecting private, non-commercial landowners and farmers in a way that was simply not anticipated.

As the 2017 code has resulted in fewer new sites being agreed due to much lower rents being paid by operators, I urge my noble friend the Minister to look at this and not to bring further renewals under the new code, but to leave them under the Landlord and Tenant Act 1954. I would certainly like to explore that as the Bill proceeds through this place. Has my noble friend received representations to this effect, and will he give us an undertaking this afternoon to address this as part of the passage of the Bill?

I would like to flag up to my noble friend another concern about why operators are not moving from calculating rent based on land value to market value, to which I just referred, and whether this will be the barrier to hosting future digital infrastructure on private land—a fear I share.

The Bill includes an alternative dispute resolution mechanism, which I welcome, but I ask my noble friend: why is using it optional for operators? Currently the Bill does not properly address the imbalance between the resources of operators—which seem to have limitless resources to contest a disagreement before the tribunal—and landowners, many of whom find resisting a claim before a tribunal simply beyond their means.

I end with my noble friend’s opening reference to the increasing existence of and potential for cyberattacks. I witnessed one in North Yorkshire on a company which, sadly, was not given any helping hand from the Government. It was advised not to pay a ransom but was told that if it did not pay the ransom, it probably would not have its systems back in place. Is there any opportunity through the Bill to extend more help to companies to ensure that any such future attacks will see more assistance offered to address the cyberattack and help companies get their systems back without paying a ransom? I think it ran into millions when it was the clothing company FatFace.

Many cyberattacks operate below the radar and do not enter the public domain for very good reason—because it is not good for business. Obviously, if a company is not insured before the cyberattack, it will certainly not get insurance after a cyberattack. I hope my noble friend will look favourably on a plea to ensure that more assistance is given, to prevent not only cyberattacks but the payment of ransoms when they happen.

I shall support the vast majority of the Bill, but I will be raising all these issues through it. I look forward to ensuring that my noble friend and his department will act as smartly as the devices we are hoping to use.

Product Security and Telecommunications Infrastructure Bill

Baroness McIntosh of Pickering Excerpts

Lords Hansard - Part 1 & Committee stage
Wednesday 29th June 2022 Lords Chamber

I do not have any comments on the clauses stand part, because I am not quite sure exactly what is motivating them, but I shall be interested to hear what the proposers have to say. I beg to move.

[Baroness McIntosh of Pickering (Con)]

My Lords, I am delighted to speak to the amendments in my name and that of the noble Earl, Lord Devon. I thank him for his support. We are having a short debate on why Clauses 66 and 72 should stand part of this Bill. I will briefly take each in turn.

As the noble Lord set out in moving Amendment 19 from the other Benches, the problem we are dealing with is getting on to land where people have possibly not had notification that their land is going to be entered. It also raises the possible cost of applying to the court in such circumstances, which begs the question: if, eventually, those who own the land are made aware, would the alternative dispute resolution procedure apply? I am not sure which of my noble friends is replying, but if my noble friend Lord Sharpe could kindly take that and give me a response, I would be most grateful.

The powers that we are allowing to the department and the Government in Clauses 66 and 72 are very wide ranging. Will Parliament have the right to scrutinise these regulations and at what stage? Do the Government intend that the regulations will be widely consulted on? At what stage would we have the right to scrutinise regulations under both clauses, as the devil will be in their detail?

Regarding Clause 66, I am most grateful to the noble Earl, Lord Lytton, for sharing the briefing we received from the Central Association of Agricultural Valuers, which has been extremely helpful in helping us prepare for today’s debate. In relation to Clause 66 and the issue of unresponsive occupiers, it sets out:

“Understanding the point of this Clause, it should require the operator to have taken particular efforts to establish direct contact with the proposed grantor rather than allow this to be a convenient route to impose on off-lying land by the use of a succession of notices.”


It hopes that discretion is provided to the court by new paragraph 27ZE of the code inserted by Clause 66. That would allow it to regulate the use of this power appropriately and recognise what might be particular personal circumstances. It refers in particular to the 2020 case of EE v Cooper and notes that the tribunal felt that it had to deny an operator’s application for “interim rights” when it pleaded an unresponsive occupier, as it considered that the operator needed to show that

“far more had been done to contact the occupier than has been done in this case, where there has not even been an attempt to knock on the respondents’ door”.

It appreciates the compensation provisions set out in new paragraph 27ZG of the code.

In sum, I felt that it was necessary to ask why it is right that Clauses 66 and 72 should form part of the Bill primarily because we are granting the Government extensive powers that are not set out in the Bill, so we should reserve the right to consider them when they are set out in regulations. I would like confirmation that that is the case. Even more substantially and significantly, I am concerned about the lengths that an operator will be forced to go to before it is deemed to call an occupier an “unresponsive occupier”. I look forward to my noble friend the Minister’s response.

[The Earl of Devon (CB)]

My Lords, I will speak briefly in support of the two proposals from the noble Baroness, Lady McIntosh, to which I have added my name, that Clauses 66 and 72 do not stand part of the Bill. As I noted at Second Reading, I am a landlord to a telecommunications mast, granted by my father under the 1954 Act. The renewal of this has been complicated considerably by the 2017 reforms and the huge uncertainty that has followed.

Just last week, the Supreme Court ruled on a group of three cases involving the last set of amendments to the Electronic Communications Code. The lead case was Cornerstone Telecommunications v Compton Beauchamp. The court ruled that, among other things, a landlord under a “subsisting agreement” is entitled to insist on renewal under the 1954 Act and the operator cannot insist on a code renewal by application to the Upper Tribunal. It seems ironic timing that, just as the highest court in the land has finally got to grips with those 2017 amendments and provided a little clarity, we are seeking to make yet further changes and further confuse the issue.

Since Second Reading, I have been in contact with a number of groups representing site owners, and all have reported incidents of unprecedented dispute and considerably challenging renewals. As I said at Second Reading, this cannot have been the intention of the 2017 amendments and should not be the result of this legislation either, which is why I put my name to the proposals that Clauses 66 and 72 do not stand part.

I think that we all agreed at Second Reading that we wish Project Gigabit to succeed, and my intention is to ensure that landlords and site owners are encouraged to grant leases to telecoms masts and other infrastructure. The recent soundings of the market suggest that this is not currently the case and that the granting of new leases has slowed considerably since the 2017 amendments and the decrease in rents and increase in disputes that have resulted.

On these clauses, the draconian access provisions for unresponsive occupiers and the rights of network providers in relation to infrastructure are simply too broad and uncertain and, as the noble Baroness, Lady McIntosh, stated, they will serve only to discourage the granting of leases for further network infrastructure. I do not think that that is in anyone’s interest.

Specifically on Clause 72, the noble Baroness, Lady McIntosh, raised the regulations. I note that new subsection (7) says:

“Before making regulations under subsection (1) the Secretary of State must consult … OFCOM”


and

“such other persons as the Secretary of State considers appropriate.”

In responding, can the Minister clarify who that would be, because surely representatives of the site providers should be consulted? We should get an opportunity to understand exactly what these regulations will entail; otherwise, we seem to be providing Ofcom carte blanche to do whatever it likes. As we have seen, whatever it likes has not resulted in a satisfactory outcome for connectivity.

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[Lord Sharpe of Epsom (Con)]

My Lords, I think that they should have notice, but the point is that the paragraph 17 conditions exclude activities that would impose an additional burden on a site provider, as I have just said, and activities that disrupted their day-to-day business or create new health and safety risks would not satisfy the requirement. I honestly think that answers the point.

I think that I have answered most of the questions; I will obviously check Hansard and, if I have not, I will come back. In the meantime, I hope that the noble Lord, Lord Bassam, is prepared to withdraw this amendment.

I move on to Clause 66, as probed by my noble friend, Lady McIntosh of Pickering, with the support of the noble Earl, Lord Devon. It creates a bespoke process for the court to impose an agreement where an operator needs a person, to whom I shall refer as “the landowner”, to confer or be bound by code rights and that person fails to respond to repeated requests for such rights.

The provisions require an operator to have sent an initial request notice and two warning notices, followed by a final notice, to the landowner. There must be a period of 14 days between the giving of each notice, meaning that the landowner will have been given a minimum of 56 days in which to respond to the operator. For the landowner to fall out of scope of Part 4ZA, all that is required of them is to respond to any of the above notices in writing before the operator applies to the court. If granted, a Part 4ZA order will impose an agreement on the landowner and operator. The terms of that agreement are to be specified in regulations made following stakeholder consultation.

My noble friend asked about situations where landowners are non-responsive. If they are unwilling to engage, for example, in alternative dispute resolution processes, it will remain open to the operator to apply to a court under Part 4 of the code to seek an order to impose an agreement granting code rights. These provisions impose a six-year maximum time limit on the period for which rights conferred under a Part 4ZA order may last. I emphasise this detail because it forms an important part of the Bill’s safeguards on landowners’ property rights. This clause provides a much-needed process that will play a large part in ensuring that homes and businesses benefit from the national gigabit broadband upgrade and are not left behind. I therefore commend Clause 66.

[Baroness McIntosh of Pickering (Con)]

I think both the noble Earl, Lord Devon, and I asked whom, following court rulings in this regard, but also in terms of regulations, do the Government or the department intend to consult? Will they ensure that the occupiers are on that list? It is not clear from the drafting of the Bill that they will be included.

[Lord Sharpe of Epsom (Con)]

If my noble friend will permit, I will come to the points she raises on consultation shortly.

Clause 72 will allow the Secretary of State to amend the Communications (Access to Infrastructure) Regulations 2016. Sharing infrastructure in the concentration of gigabit-capable networks can greatly reduce the cost and increase the pace of deploying networks, and can reduce the need to dig up streets, preventing unnecessary disruption to the local population and reducing carbon emissions. The 2016 regulations enable sharing of information about access to physical infrastructure across the utility, transport and communications sectors. They also include the right to access that infrastructure on fair and reasonable commercial terms and conditions. The Government published our response to the call for evidence on a review of these regulations last year. We set out that there may be some areas where they could be made easier to use and to understand.

In addition, we said we would legislate to allow future changes to the regulations via secondary legislation rather than relying on primary legislation. That legislation would be subject to further consultation with Ofcom and other appropriate parties. To expand on that a little, Clause 72 makes clear that

“the Secretary of State must consult … OFCOM; … such other persons as the Secretary of State considers appropriate”

before making such regulations. I cannot conceive of a set of circumstances where the landowner would not be one of the other persons that the Secretary of State considers appropriate—obviously, if I have that wrong I will write to noble Lords. In addition, any regulations made using this power will still be scrutinised as part of the affirmative resolution procedure. Clause 72 therefore grants to the Secretary of State a narrow power to make provision, through regulations, conferring rights on network providers in relation to infrastructure for the purpose of developing communications networks. These provisions include the power to amend, revoke or replace the 2016 regulations.

Finally, my noble friend Lord Vaizey raised some useful points about operator behaviour, which I think we may discuss in more detail in later amendments in group 6 on the Ofcom code of practice. I will leave it till then to address those, if that is acceptable.

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As the noble Earl, Lord Lytton, said, Amendments 20, 22 and 23 would reverse the imposition of a “no scheme” valuation regime while retaining the Law Commission’s recommendation to stop ransom rents. Infinitely reasonably, the noble Earl has put forward an alternative in the form of Amendments 24 to 27, which are predicated on the “no scheme” valuation regime effectively remaining in place. We agree that this is not the best solution, but as he said, the changes serve to illustrate that a Government who really wanted to strike a balance between different interests could find a way of doing so. As he said, we need stability and certainty, and they are not there at present. It is certainly not facilitating speedy rollout, whatever the operators might say. I hope the Government will very carefully consider these very reasonable amendments.

[Baroness McIntosh of Pickering (Con)]

My Lords, I congratulate the noble Earl, Lord Lytton, on his Amendments 20 and 22 to 27. I am delighted to support them. I hope the Government will look favourably on them for the reasons he gave so eloquently.

I will briefly address the reasons why I have asked whether Clauses 61 and 62 should stand part of the Bill. In my view, it would be better if they were not part of it. As has been said, we seek a balance with the Bill, but, as I see it, the balance is shifting further away from the occupiers in favour of the operators. I have no particular interest in this other than as a consumer, although for a period I was the co-owner with my brother of two fields in the Pennines on which a mast was placed, so I presume I would have been in receipt of a modest fee for that infrastructure to be in place. Sadly, my brother bought me out and I no longer can claim that benefit or disbenefit.

My concerns are reflected in the amendments so ably spoken to by the noble Earl. The Bill proposes to change the way that land is valued so that it can be applied retrospectively to the renewal of some sites that were in existence prior to 2017. Secondly, the Bill includes provisions for an alternative dispute resolution mechanism, which I support, although, as I stated earlier, operators should not feel the need to engage with this mechanism if their resources marginalise the opportunity for a fair and equitable resolution for many landowners who simply do not have the confidence or means to contest them.

I will make a general point not dissimilar to that made by my noble friend Lord Vaizey and the noble Earl, Lord Devon, on the previous group. All of us who live predominantly in the countryside are providing a service for the rest of the community, especially those who live in country districts, by hosting on the land infrastructure owned by the occupier. That has to be recognised, and that is why I have great difficulty, considering the way the code has been applied since 2017 and under the terms of the Act, with the fact that the code will be applied more strictly.

I want to add a comment that my noble friend Lord Parkinson is familiar with, because I wrote to him about it. I am most grateful to him for his reply. Why can civilian use not be made of the emergency services network? He is aware that a number of masts have been placed and erected across North Yorkshire, particularly in the hills and the moors, where we have a very poor mobile phone frequency and very poor connectivity with broadband and wi-fi. If there is any possibility of us piggybacking on the emergency services masts for civilian use, that would be to the huge benefit of the wider community.

I go back to the time in 1997 when I was first elected to the other place as the Member for the Vale of York. We had a situation where the emergency services and the police could not be reached, which is why the emergency masts were put in place at some considerable expense to the taxpayer. I am sure there can be no security aspects that could not be dealt with to allow us to use them. I appreciate that that is a separate point.

I entirely agreed with the noble Earl, Lord Devon, when at Second Reading he set out, as did I, that we are moving to the situation which existed before 2017, with a regrettable consequence of potentially fewer landowners and occupiers permitting the infrastructure to be placed, or to continue to be placed, on their land.

I have given notice of my intention to oppose the question that Clause 61 stands part of the Bill, which gives operators the ability to calculate rent based on land value rather than market value when renewing tenancies to host digital infrastructure on private land. I think that is fairly self-explanatory. I have given notice of my intention to oppose the question that Clause 62 stand part of the Bill, as it gives operators the ability to calculate rent based on land value rather than market value when renewing tenancies to host digital infrastructure on private land in Northern Ireland.

The noble Lord, Lord Clement-Jones, quoted the useful briefing we have had from the Central Association of Agricultural Valuers, or CAAV. It states quite specifically that its understanding in relation to the renewal of business tenancies conferring code rights in Clauses 61 and 62 was that:

“The changes here were not understood to be part of the consultation”,


which we have heard about.

“The Government was understood to have made it clear in the 2021 consultation that it did not intend to revisit the valuation framework. Indeed, the government’s response to the consultation stated: … ‘the government does not intend to revisit the statutory valuation framework. This issue was therefore not within the scope of the consultation.’”


If that is indeed the case, I regret that we have perhaps not heard all that we should have heard from occupiers and landowners in regard to these provisions.

In relation to Clause 61, the CAAV concludes that

“Lord Lytton’s proposed amendments to both clauses would also in principle retain the market value basis for these first renewals but disregard the operator’s qualified Code powers to upgrade and share apparatus. If these clauses are retained, we support these amendments.”


I share the reasoning behind that, which is why I support those amendments. With those few remarks, I look forward to hearing what my noble friend makes of my proposals to delete Clauses 60 and 61.

[Lord Northbrook (Con)]

My Lords, I apologise for not being able to take part at Second Reading and in the first day of Committee. Like the noble Earl, Lord Devon, we all want Project Gigabit to succeed. I support my noble friend Lady McIntosh and the noble Earl, Lord Devon, in their proposals to delete Clauses 61 and 62. If they do not find favour, I would support cross-party Amendments 20 and 22.

I must first declare an interest as an NFU member and the landlord of two telecom masts. One rent review has already taken place. The original offer was a 95% rent reduction. I could probably have got rid of the mast, but as it borders the M3 I did not think that it was in the public interest. Having negotiated for 21 months, I got the reduction down to only 73%, but my legal fees in doing that exceeded my first year’s new rent, and it was quite stressful.

That is quite unimportant compared with the huge loss of income to community projects, clubs, churches, social clubs, hill farmers and others. As other noble Lords have mentioned, the organisation Protect and Connect, set up last year to give a voice to property owners in rural and urban communities who rent their land for mobile phone masts, has highlighted this real problem for these categories of landlords.

It is not just individual landowners who are affected. I quote a March 2022 cutting from the Daily Express, “Mobile masts firms branded ‘Goliath bullies’”:

“Thousands of churches, charities, hospitals and sports clubs face reductions in mast rents—and a social club popular with pensioners has had rent slashed from £3,500 to around £550 a year, an 85 per cent cut.”


The Daily Mail online said:

“Hundreds of sports clubs, farmers, charities, churches … and community groups with mobile phone masts on their property … have seen a drop in rents of … 90 per cent”.


In January 2022, the Sun said that thousands of churches, charities and social clubs face a cut of up to 90%. The headline in the Edinburgh Evening News was: “Edinburgh pastor fears for church’s future after ‘bullyish’ EE slashes mast rent by 96 per cent”. In Property Week it was: “Telecoms Bill set to enforce huge rent cuts for landlords”.

For these reasons, I believe that the amendments I have mentioned give a fairer outcome to the balance between landlords and tenants. As noble Lords have already heard, it is not only me who believes this. The respected Centre for Business & Economic Research has calculated that the 2017 reforms have not delivered a faster 5G rollout. As the noble Lord, Lord Clement-Jones, stated, providers have lost £200 million of income, including £60 million of lost local authority income and £44.2 million of lost agricultural or rural site income.

The Government’s proposed reforms would cause rents to fall by a further 41% from their post-2017 levels. On a 10-year basis, this is equivalent to a cut in local authority funding of £645 million and a cut to sports centres, social hubs and hospitality of £158 million. The CEBR says that site rental was not unfair before 2017 and that mobile operators have not used savings to invest in communications networks; nor do rent costs impact their profitability materially.

The noble Earl, Lord Devon, emphasised at Second Reading that a “broad array of stakeholders” oppose this legislation,

“from the NFU and CLA, to the CAAV, the BPF and the Law Society … By these provisions, the Government will be intervening in long-standing existing leases, freely negotiated between willing participants, to dramatically decrease rental values, often years after the fact.”—[Official Report, 6/6/22; cols. 1053-54.]

It is another blow to farmers’ diversified income and, in my experience, will further delay mast development. I will not want to go through 21 months of tortuous negotiation again for a new mast, particularly having just heard about the access issues in Clause 66. That is why I support a fairer method of rent calculation, as proposed in the amendments.

I am disappointed that a Conservative Government reject an amendment on market value and wish to proceed with extending the unfair 2017 Act to the Landlord and Tenant Act 1954 and the Business Tenancies (Northern Ireland) Order 1996.

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Debate on whether Clause 63 should stand part of the Bill.

[Baroness McIntosh of Pickering (Con)]

My Lords, I will speak to the stand part notice in my name, on which I am delighted to have the support of the noble Earl, Lord Devon, opposing that Clause 63 should stand part of the Bill.

The new sections inserted by Clauses 63 and 64 make provision for all code agreements, when renewed by court order, including those made prior to 2017, to be made on land valuation terms consistent with the 2017 code. The new sections will apply to England and Wales or to Northern Ireland only. These measures, I understand, were a response to the consequence of the 2017 ECC reforms on the treatment of certain expired code agreements that are up for renewal, as had been set out in the previous consultation.

Again, Clauses 61 to 63 expand the agreements covered by the Digital Economy Act 2017 to extend to areas previously exempted from the renewal procedures of the 2017 Act, specifically those covered by Business Tenancies (Northern Ireland) Order 1996 and the Landlord and Tenant Act 1954. The clauses also insert the valuation provisions of the code directly into the older legislation so that consideration of compensation for site owners under these agreements is calculated in a similar way to that under the code, as we have heard, leading to lower rents.

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[Lord Sharpe of Epsom (Con)]

I read my brief very carefully, and I said “any transitional provisions in respect of the Bill”—I did not say that there will be transitional provisions—after listening to the various concerns I just outlined.

I now turn to Amendment 34 tabled by the noble Lords, Lord Clement-Jones and Lord Fox, the noble Earl, Lord Lytton, and the noble Baroness, Lady Merron. This is an amendment to the 1954 Act which seeks to prevent interim rent being backdated where an agreement is renewed under that statute. As we have discussed when talking about Clauses 61 and 62, it is the Government’s intention that the various statutory mechanisms for the renewal of agreements to which the code applies is as consistent as possible, and this amendment would increase inconsistency.

First, the amendment would create inconsistency within the 1954 Act itself. The ability to seek backdated payments of interim rent would be prevented only where the site provider had given notice to the operator under Section 25 of the Act. Where an operator had served notice under Section 26 of the Act, the ability to seek backdated rental payments would remain. Secondly, it would create inconsistency between the 1954 Act and the code. Clause 67 will allow payment of a modified rate of consideration to be backdated to the date of the application, whereas I understand that the noble Lords’ intention is to prevent rent from being payable at the backdated interim rent rate. It is difficult to justify such inconsistency.

Finally, the ability to seek an interim rent which is backdated is not a new concept. The parties would have been aware of this when entering into those agreements to which the 1954 Act applies. There is always a risk that the market will have adversely changed between the date on which the agreement was entered into and the time when the agreement is ready for renewal, and that the interim rent will be less than the amount currently paid. I appreciate that this may be exacerbated by the imposition of the code valuation framework on these agreements, but the Government will look at this impact when drafting any transitional provisions.

Absolutely finally, the point made by the noble Lord, Lord Clement-Jones, about picking and choosing, was covered by my noble friend Lord Parkinson on the first day of Committee in relation to Amendment 17, but if there are any outstanding questions on that, we would be very happy to discuss them separately. In answer to the question from the noble Earl, Lord Devon, about general valuations, my noble friend will deal with that in the next group. Under the circumstances, I hope that noble Lords will not press their amendments.

[Baroness McIntosh of Pickering (Con)]

I am most grateful for the debate we have had, and I hope that my noble friend will look warmly on the amendments that were so ably spoken to by the noble Lord, Lord Clement-Jones. I have to say that it was rather amusing, being a lawyer, to hear that this would be a good opportunity for lawyers. I would not have thought that would be something the noble Lord would pass down. I look forward to continuing the debate.

Clause 63 agreed.

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[Lord Clement-Jones (LD)]

My Lords, I should just say that it is not my role to make friends among my colleagues in the legal profession; it is to try to get the right result out of the Bill.

I have just one observation on the previous group. It is interesting to note that the Government have some wonderful ways of resisting amendments. They say that it would be inconsistent with the Bill, but they are perfectly capable of passing amendments of their own which are not fully consistent, because that is what exceptions are—they are there because there would otherwise be an injustice.

The site providers are making and have made a very strong case that they need better protection against abuse by operators. Throughout this Bill, we are of course very mindful of the balance between site providers and operators. The Government believe that the provisions of the Bill are putting this in order, but many of us believe that they are putting it in disorder as a result. The Protect and Connect campaign has come up a number of times already during the course of debates on the Bill. It surveyed 116 site owners that host mobile telecoms masts and found that 23% have suffered damage to their property; 35% have had their sites upgraded without permission; 46% have found telecoms companies on their land without warning; and 50% have been threatened with legal action. That does not sound like very good behaviour on the part of the operators. In this context, Clause 68, on the alternative dispute resolution, is of great importance. It sets out the process by which an operator can request rights to land from an occupier, which will now include information about alternative dispute resolution.

The clause however requires operators only to “consider” the use of ADR for resolving disputes with site owners where “reasonably practicable”. It also permits courts to take an operator’s “unreasonable” refusal to consider ADR into consideration when deciding on remedies during a dispute. The ADR process that the Government are providing is therefore non-binding. Telecoms companies need only show that they have considered it in order to avoid costs.

To address this point, the Government should make ADR compulsory for any dispute and issue guidance about reasonable terms. Properly enforced, it would reduce the operators’ reliance on litigation through the courts and encourage better behaviour by both parties. It is important that there is greater onus on the operators to make use of this process, because the terms of the code are so heavily weighted in their favour and their ability to use the courts in general is far greater, befitting their corporate size compared to the average site owner. Given the potential benefits for both parties and the wider public interest, it is difficult to see the case for this process remaining purely advisory.

As regards Ofcom’s guidance, Ofcom has long provided guidance on the ECC, but to date it has not provided any real support for site owners experiencing problems. Amendment 39 is intended to force operators to give greater weight to Ofcom’s code of practice, which it is currently obliged to prepare under paragraph 103(1) of the ECC. Tribunals would be obliged to take into account an operator’s compliance, or lack thereof, when making costs awards. The purpose of this is to render Ofcom’s code of practice meaningful, rather than just optional guidance that is all too easily disregarded.

Amendments 40, 41 and 42 aim to address the issue of non-compliance with Ofcom’s code of practice. It is right that operators are held to standards in how they treat site providers, including measures such as the provision of information or the conduct of negotiations. However, there is a significant body of evidence that, despite the code of practice, site providers are not being treated fairly or with respect by the operators from whom they rent their land. The solution to the problem of non-compliance with the code of practice is to strengthen these measures, yet Ofcom has failed to invest adequately in this area and the Government have spent too long asking the industry to solve its own problems through stakeholder workshops, rather than showing direct leadership. These amendments will collectively place obligations on both operators and site providers. The intention here is not to place an asymmetrical set of requirements on either party in these negotiations or to these agreements.

Amendment 40 would create an obligation to follow the code of practice. It would create a maximum financial penalty for non-compliance of £1 million and require Ofcom to have regard to prior history of non-compliance when assessing the size of any penalty imposed. This amendment would provide a strong incentive for adherence to the code of practice. Moreover, it would require a previous history of poor behaviour to be taken into account. This means that operators or site providers would not be able to disregard the code of practice just because they think they can pay the fine, and poor behaviour would have increasingly impactful consequences. Amendment 42 requires that Ofcom include in its code of practice guidelines on when operators must pay compensation to those affected by a failure by the operator to adhere to the code of practice.

If the Government are serious about promoting consensus-based agreements and getting this market working again, having clear and enforceable guidance on the standards expected by the parties is essential. This is what these amendments try to achieve. I very much hope that the Minister will take all the amendments and their intention on board.

[Baroness McIntosh of Pickering (Con)]

My Lords, I shall speak to Amendments 36, 37, 38 and 39, and the proposal that Clauses 68 and 69 do not stand part of the Bill. I am delighted to have the support of the noble Earl, Lord Devon.

I am slightly stung by something my noble friend the Minister said earlier: that perhaps we are all paying too much heed to lobbyists. I think my noble friend knows me well enough now to know that I am of particular independence of mind. However, when an allegation is made by those seeking to brief us on the Bill that the Bill has swung too heavily against the interests of the landowners—of which I am not one; I have no particular interest in this other than as a consumer, as I said—and too heavily in favour of the operators and networks, that is something that I think he would expect us to explore. It is something we are encouraged to do when we are introduced. The Reading Clerk reads out that we are given a seat, place and voice in the councils, assemblies and Parliaments to enable us so to do. I take those responsibilities very seriously indeed.

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[Lord Parkinson of Whitley Bay (Con)]

I am very happy to consult my colleagues at the Department for Levelling Up, Housing and Communities and to provide the letter the noble Lord requires. I invite him now to withdraw his probing amendment, and other noble Lords not to move theirs.

[Baroness McIntosh of Pickering (Con)]

Did I hear my noble friend correctly regarding the Country Land and Business Association? If so, I can put his mind at rest. It is most definitely in favour of the alternative dispute resolution being made mandatory. He should be aware of a briefing that was sent to us at a much earlier stage. This dates back to January, so I hope it is not still the case:

“Throughout the Government’s consultation on the Bill, the Department of Digital, Culture, Media and Sport has repeatedly refused to meet with our organisations”,


including the CLA and others,

“to hear the views of our members. The Bill was subsequently published without any economic impact assessment.”

I am slightly concerned that my noble friend appears to be unaware of something as fundamental as the difference between a mandatory and a voluntary ADR, and I wanted to correct him on that.

[Lord Parkinson of Whitley Bay (Con)]

I am sorry to disagree with my noble friend, but the CLA’s response to the consultation opposed compulsory ADR. I would be very happy to speak to her and triple check that with officials afterwards, but we clearly have different understandings of its position. I would be happy to speak to her afterwards to make sure that we can clarify that.

Product Security and Telecommunications Infrastructure Bill

Baroness McIntosh of Pickering Excerpts

Report stage
Wednesday 12th October 2022 Lords Chamber

[Baroness McIntosh of Pickering (Con)]

My Lords, I thank the noble Earl, Lord Devon, for moving Amendment 19. I will speak to Amendment 20 in my name and that of the noble Earls, Lord Lytton and Lord Devon, and Amendment 21 in my name and that of the noble Earl, Lord Devon.

At the outset I welcome my noble friends Lord Kamall and Lord Harlech to their new positions. At the same time I thank my noble friend’s predecessor, my noble friend Lord Parkinson, for all his efforts and engagement with us at previous stages of the Bill. I wish him well as a Back-Bencher in this place; I think we probably have more fun.

I remind my noble friend Lord Kamall that in his previous life he was well aware of my interests in rural affairs, which colour my approach to the Bill. I would like to see improvements to broadband and mobile phone connectivity in rural areas, but I cannot take the fact that telephone poles and other infrastructure should be taken for granted, as appears to be the case in the Bill. That is my reason for presenting and speaking to Amendments 20 and 21, with the desired effect that they will remove provisions currently in the Bill that give operators the ability to calculate rent based on land value rather than market value when renewing tenancies to host digital infrastructure on private land. I believe that all interested parties, whether the operators, the landowners or those of us who use these infrastructure facilities, must be treated fairly, in the way that the landowners are currently compensated.

I assure my noble friend that good connectivity is key to increased productivity and growth for farms and the rural economy. I hope he will give a commitment today, just as the Prime Minister has said many times since she took her new position that we are signed up to productivity and growth, that this will apply as much to the rural economy, farms and others who have business in rural areas as it does to more industrial areas.

I confess that I am not a landowner or in receipt of a wayleave for a telegraph pole, although not so long ago I received a small payment, shared with my brother, who is now the sole recipient. I hope that these amendments can achieve a better balance between the rights of the operators, the landowners and those who use the infrastructure.

I regret that the 2017 Electronic Communications Code has changed the way in which the new sites are valued from market value to land value. I make a plea to my noble friend that we proceed under the Landlord and Tenant Act 1954 rather than the 2017 code, given that, as I mentioned earlier—and as the noble Earl, Lord Devon, so eloquently described—fewer new sites have been agreed over the last few years in which we have proceeded under the code.

I echo and strongly associate myself with the remarks of the noble Earl, Lord Devon, about this not being part of the original consultation under the Bill. I hope that my noble friend Lord Kamall will confirm that and say why it was not and yet we now have these two clauses in the Bill, because I have never quite understood why that was the case. If you are not going to give the landowners and other interested parties—or stakeholders, as we now call them—the right to comment, I do not see why they should be presented with a fait accompli. But, even more than that, the Law Commission strongly concluded that it was against the introduction of these provisions into the Bill because it thought that they would lead to fewer sites and fewer renewals of sites, which is precisely the position in which we find ourselves today.

Why is this going against the Government’s previous stated intention of allowing a transition for existing agreements into the ECC, or the code? It also means that the code valuation method will be applied retrospectively. I understood that we normally do not apply legislation retrospectively in this place, and I would like to understand the reasons for seeking to do so in relation to Clauses 61 and 62.

The Government’s own impact assessment of the 2017 reform concluded that rents would drop by 40% over a 20-year period. It was therefore not anticipated that levels would fall by so much and so quickly. However, the noble Earl, Lord Devon, clearly set out that, in some cases, rents have dropped by as much as 90%, which is inexplicable and unacceptable. Clauses 61 and 62 would simply exacerbate the situation and leave some businesses and individuals facing a cliff edge, without any time to adjust in what we understood would be a transition period. I repeat that this was not part of the 2021 consultation, and, in my view, it will no doubt be entirely counterproductive, with the effect of further disruption.

Given that we now know that the 2017 code has resulted in fewer new sites being agreed, due to the much lower rents being paid by operators, I urge the House to remove Clauses 61 and 62. I urge the Government to accept that they should proceed under the previous legislation, the Landlord and Tenant Act 1954. I hope that the House will look favourably on my Amendments 20 and 21.

[Lord Cromwell (CB)]

My Lords, in his opening remarks, the Minister, the noble Lord, Lord Kamall, said that some of us might not welcome him here. I am sure that that is not correct; I am sure that we all welcome him and his colleague, the noble Lord, Lord Harlech. I certainly do.

First, I apologise to the House for not participating in the earlier stages of the Bill due to circumstances elsewhere—but I have read and watched them. Secondly, I should declare that I am an unpaid director of a small farming company that has a single telecoms mast on its premises. Normally, I would not speak on a subject when I have an interest even as modest as this, and I know that a number of other noble Lords have not participated and remained silent for the same reason. However, having seen how one-sided and damaging this part of the Bill is in so many ways, including to the Government’s own objectives for rollout, and having seen how resistant the Government have apparently been to efforts to address its faults, I feel that I must speak out critically but constructively. I support all the amendments in this group but, to my mind, Amendments 20 and 21, which would leave out Clauses 61 and 62, are the starting point, with the other amendments seeking to achieve damage limitation.

There are two parties to any agreement on a site: the site owners and those who seek to occupy and operate them. Not only is this Bill crudely unjust in its valuation basis but it is already creating a breakdown of trust and co-operation between the parties. It will create and intensify conflict between them, leading to a delay in rollout—the direct opposite of what the Government intend. We, therefore, need to find a better middle ground between these two parties.

As has already been mentioned, Clauses 61and 62 would have land valued as if it were not to be used for a mast site. This is as bizarre as anything in a Gogol short story. Who would, for example, value a building plot, knowing that it is imminently going to be built on, on the basis that it would never be built on? I am sure that HMRC would never countenance that approach for tax purposes.

Amendments 20 and 21 reflect the need to remove these counterproductive and illogical clauses—but how did we get here? We need to be fair about this: previously, some owners, due to the rules of supply and demand, had a bargaining position that may have enabled rents that are higher than they would otherwise have accepted. In seeking to accelerate rollout, the Government have decided to rebalance things—so far so good. However, this Bill would swing the pendulum to completely the opposite extreme. It would strip the site owners of their legally long-established property rights—something I find astonishing from a Conservative Government—and deny small enterprises, sports clubs, hospitals and others of a vital source of income. This was raised by Labour at an earlier Bill stage, and I was astonished when the then Minister—so rightly admired in other respects, as many have said—pretty glibly told them in his reply that they should simply seek other sources of income.

These clauses will take a situation where sites were coming forward voluntarily and replace it with one of zero trust—in either the operating companies or the Government—whereby both potential and actual site owners will seek to avoid, and indeed resist, providing sites for this use. It will enable the operating and mast companies to pay peppercorn rents and thereby enrich themselves and their shareholders—with no evidence of trickle down, or even dribble down, to consumers.

When I see all this, combined with powers elsewhere in the Bill for operators to reclaim rents retrospectively from site owners—tearing up existing contracts freely agreed and entered into by professional commercial companies and site owners—I can only gasp in disbelief. So I have been asking myself how on earth we got into this situation and what could explain it. I have been urged by some of my colleagues to be temperate in my remarks, so I will not indulge in conspiracy theories, but we need to focus on encouraging sites to come forward to achieve faster rollout—something which I think we are all agreed on.

Let me therefore offer a valuation solution that is indeed in the middle ground between the past and the extortionate future foreseen in this Bill. There is a tried and tested middle ground that uses a practical and already widely accepted approach used to set rents and values for other commercial sites. I ask the House’s indulgence in describing this very briefly and simply with an illustration from another commercial activity: mineral quarrying. Where a quarry operator wants to lease land to set up a processing plant, there is a well-established valuation method whereby the database of local industrial rents is assessed and a percentage of that rent—say 70%—is paid to the site owner. There are clear advantages here. First, land agents and valuers on both sides are well accustomed to such discussions, which can therefore be swift. In the very unlikely event that they do not reach agreement, binding expert determination is available as standard. Secondly, it is based on a well-established dataset that reflects regional differences and will adjust over time to reflect the regional economic context. Thirdly, there are suitably qualified practitioners on hand across the country to carry it out.

Crucially, this would produce a balanced result and would get there using a transparent, objective and logical method. To be clear, the resulting rents would be set below what some site owners currently receive, but not as counterproductively or extortionately low as the unjust free hand that the Bill, as currently drafted, would give commercial operators. I therefore urge the Minister and the Government to think again.

--- Later in debate ---

DCMS Ministers and officials have listened carefully to the feedback that they have received, and the Government acknowledge that reduced rents received by site providers may have made them less willing to host telecommunications apparatus. However, this was recognised as a probable outcome in 2017. It remains the case that the Government think that the valuation regime is the right one, and the feedback that we have received from stakeholders prior to and during the consultation strongly suggests that measures in the Bill will help to ensure the aim and ambition of the 2017 reforms.

[Baroness McIntosh of Pickering (Con)]

I am following very carefully what my noble friend has said. He just said that responses to the consultation were received. The offending articles were not part of that consultation, so the Government have not actually heard any responses from the interested parties on that point.

On his point about Clauses 63 and 64 remaining part of the Bill, which is why we cannot remove Clauses 61 and 62, my reading of Clause 63 in particular relates to new tenancies. My noble friend has not responded to the points raised by both the noble Earl, Lord Devon, and me about existing agreements that are going to be renewed, rather than new agreements.

There are two points to which I would like the Minister to respond: first, this issue was not part of the consultation so the Government have not received any responses on it. Secondly, what happens to existing agreements being renewed under Clause 63? Are they to be slashed by 90% without any recourse?

[Lord Kamall (Con)]

I thank my noble friend Lady McIntosh for those questions. I will come to them—I am sorry, maybe I am not going as fast as noble Lords would hope me to, but I wanted to consider carefully the various points made by noble Lords, and I still have specific responses to come to. If noble Lords will allow me to talk to Amendment 24, I will come back to the contributions made during the debate.

Amendment 24, tabled by the noble Earl, Lord Lytton, but spoken to by the noble Earl, Lord Devon, looks to prevent interim rent being backdated where an agreement is renewed under the 1954 Act, and is similar to the amendment tabled by the noble Earl in Committee. One of the fundamental aims of the Bill is to ensure that the approach to renewing agreements across part 5 of the code, the 1954 Act and the 1996 order is as consistent as possible. As my noble friend Lord Sharpe said in Committee, this form of amendment serves only to increase inconsistency. It would create inconsistency within the 1954 Act itself, preventing backdated payments of interim rent where a site provider gives notice under Section 25 of the Act, yet would allow interim rent to be backdated where an operator serves notice under Section 26 of the Act.

The ability to backdate rent is not a new concept. It is not being introduced into the 1954 Act by this Bill, nor was it introduced in the 2017 reforms. When parties entered into these agreements, there was always a risk that the market could change between the time it was entered into and the time of its renewal and that the amount of rent could decrease. However, the Government have listened to stakeholders representing the interests of site providers and understand the potential consequences of applying the code valuation framework to the 1954 Act and the 1996 order agreements in relation to backdated interim rent. This is something that is being carefully considered in developing an implementation strategy, including such transitional provisions as may be needed to bring the different provisions of the Bill into force in a timely and responsible manner.

Let me now talk to some of the points made by noble Lords. A number of noble Lords said that the evaluation regime is not fair. The Government see the pricing regime as being closely aligned to utilities such as water, electricity and gas. The Government maintain that this the correct position. Landowners should still receive fair payments that take into account, among other things, alternative uses that the land may have and any losses or damages that may be incurred.

It should be noted that, in many of the examples of unfair rent or large percentage reductions that have been raised by campaign groups, reference is made only to the rental payment itself. These examples fail to take into account any compensation payments which the landowner may have received under the agreement. They may also have failed to take into account any capital payment which the landowner may have received upfront as part of the terms of the agreement. There have been some paid studies of raised examples of poor negotiations or rent reductions. It would not be appropriate for me to comment on ongoing negotiations in specific terms, but the Government say generally that rent is often only one part of the overall financial terms agreed, as I said earlier. As regards behaviour during negotiations and the respective bargaining positions of the parties, the Government have recognised site provider concerns and are introducing measures to encourage greater collaboration.

The noble Earl, Lord Devon, and other noble Lords mentioned the reluctance to enter into new agreements. We have been told that the amounts offered by some operators are so drastically reduced that landowners are less willing to come forward and allow their land to be used. However, I have been advised that, so far in 2022, at least 107 agreements have been reached in relation to new sites, with heads of terms agreed on a further 66 sites. This is in addition to 533 renewal agreements which have been concluded this year, along with heads of terms agreed on a further 119 renewals. The Government maintain that the 2017 valuation provision created the right balance, and they are aware that the valuation framework would have resulted in some reductions, as I said earlier.

I think it was the noble Earl, Lord Devon, who talked about middlemen who take profits overseas. The benefits of independent infrastructure provision are globally acknowledged. An Ernst & Young report in February this year, produced by a European-wide infrastructure association, highlighted the many benefits which independent infrastructure providers bring to both the industry and consumers. It talked about sharing towers and costs and enabling cheaper rollout. The report concluded that the scope of independent infrastructure providers overcharging for the use of the infrastructure would be constrained by continued competition between tower companies.

Government policy introduced in the 2017 valuation framework to reflect the public interest in digital infrastructure and encourage investment while driving costs down remained unaltered. That is not to say that we approached our pre-consultation engagement with a closed mind, but that engagement with stakeholders did not indicate that the valuation framework is incapable of delivering both our policy objectives and fairer outcomes for landowners. It did highlight difficulties with communication and negotiations, hindering the framework from working as intended. We hope that the Bill and the non-legislative initiatives we are taking forward will tackle this.

There have been some claims that rents would reduce by more than 40%. In the impact assessments in 2016, the Government specifically said that they did not know what effect the reforms would have on rental payments. There is reference in the impact assessment to independent analysis which predicted a 40% decrease. Some lobby groups have asserted that this figure demonstrates that the Government committed that rent reductions would be no more than 40%. The Government maintain that this was not a government commitment, but it did appear in the impact assessment and we expected the market to adjust.

As I said, rent is only one element and other variations occur in practice. We understand the various things that have been said by various companies. A number of noble Lords reflected on the CEBR research. The Government have problems with the report from the CEBR. First, the picture the report paints of government policy is incomplete and partial. Secondly, the alternative changes the report proposes do not account for key challenges, which in our view means that they would not deliver the results the CEBR suggests. The report focuses excessively on the prospective interests of landowners and we are trying to get the right balance.

On the Institute of Economic Affairs, I should be very clear and have to declare my interests. I am the former academic and research director of the institute, so I would not wish to comment one way or the other on its report, but I know that it used as its source some of the work from the CEBR’s and other reports. My successor, Dr James Forder, is an excellent analyst and economist. Indeed, he is the economics tutor at Balliol College in Oxford—I digress.

I am afraid that, while I completely understand the arguments—I have had conversations with a number of noble Lords and am very grateful to those who have come to meetings and heard the Government’s perspective—we cannot accept these amendments. Perhaps in vain, or in aspiration, I ask noble Lords to consider not pressing them.

--- Later in debate ---

Moved by

[Baroness McIntosh of Pickering]

25: Clause 68, page 58, line 38, leave out from “must” to “one” in line 39 and insert “use”
Member’s explanatory statement
This amendment is to ensure that operators engage in the alternative dispute resolution process by making it mandatory.

[Baroness McIntosh of Pickering (Con)]

My Lords, I am grateful for the opportunity to raise what is quite a difficult situation in Amendments 25, 26, and 27. What I seek to address here is the fact that while it is welcome that there is an alternative dispute resolution process, it would be preferable that this was mandatory. I would also like to raise other issues, such as the imbalance between the funds available to operators bringing such a case and to landowners, who may be of quite modest means and modest size in being able to defend against such actions.

I welcome the inclusion in the Bill of an alternative dispute resolution mechanism. Could my noble friend the Minister take this opportunity to explain why it is merely optional for operators to use it, given—as I referred to a moment ago—the disparity in resources between operators and landowners in many cases? Is he not concerned that the incentive to use such an alternative dispute resolution mechanism for operators is low, given that they have the resources to take potentially multiple landowners to tribunal? Also, while the overall market for new sites for masts has slowed down, some small landowners have been unable to afford the cost of being taken to a tribunal to seek to defend their property rights. They have essentially been forced to agree to host mobile apparatus on unfavourable terms.

I propose Amendments 25, 26 and 27 to make it mandatory for telecoms operators to engage with an alternative dispute resolution mechanism before threatening to take a landowner to court for an agreement to be imposed. I beg to move.

[The Earl of Devon (CB)]

My Lords, I strongly support these amendments, to which I have added my name. As I have said, I am a litigator, and it is a tremendous help to get parties together in some form of alternative dispute resolution before a matter is litigated. Compelling ADR as step 1 in an escalating dispute is common, and indeed is often to be found within contractual obligations themselves, particularly between parties of disparate size and resource. Given all that has been said about the fractious and broken market, and the huge number of disputes that are occurring, the more that can be done to head these off before litigation costs escalate, the better.

I was referred to a decision this morning of the Lands Tribunal where a lease negotiation had been settled at the door of court: the decision focused only on the issue of costs. The tribunal awarded £5,000 in costs, but the total bill was over £100,000. Litigation costs can be huge and, as the noble Baroness, Lady McIntosh, has indicated, that can keep small site owners out of litigation: they have to just roll over. ADR can occur in the form of mediation, arbitration or simply expert determination on a specific technical or legal issue in contention. It is key to greasing the wheels of these challenging transactions and, given the difference in size and resource between site owners and telecoms operators, it would be most helpful.

--- Later in debate ---

It is for these reasons that the Government maintain their opposition to mandatory ADR. I hope my noble friend will withdraw her amendment.

[Baroness McIntosh of Pickering (Con)]

My Lords, I thank the noble Earl, Lord Devon, and the Benches opposite for their support for these amendments. I have to confess that I am disappointed by both the tone and the content of my noble friend’s reply. I think it goes to the heart of earlier groups where we, I think successfully, set out across the House the fact that there is a serious imbalance in the relations between the parties concerned, which will only become worse, given that the operators are going to have even more means and resources at their disposal.

I hope my noble friend will accept that, even where there is permissive procedural provision to achieve a change in behaviour, it will probably be only through mandatory—or, in the word of the Liberal Democrats opposite, compulsory—arrangements that we shall see a change. I think I have made the point as forcefully as I possibly can. I do not see that my noble friend is going to agree to these amendments, but I hope that he and his department will consider this going forward. I beg to leave to withdraw the amendment.

Amendment 25 withdrawn.

Product Security and Telecommunications Infrastructure Bill

Baroness McIntosh of Pickering Excerpts

3rd reading
Wednesday 19th October 2022 Lords Chamber

[The Earl of Lytton (CB)]

My Lords, first, I apologise for my unavoidable absence at Report last week, but I add my belated welcome to the Minister on his appointment and thank him for writing today, as well as my appreciation to his predecessor, the noble Lord, Lord Parkinson. On product security, I certainly wish this Bill well. I am somewhat less enthusiastic about its telecommunications infrastructure measures, particularly on the matter of valuation.

I express my thanks to the clerks and the wonderful co-ordination run from the Liberal Democrat offices. I thank colleagues who spoke in favour of the valuation amendments that I tabled at earlier stages, particularly the noble Earl, Lord Devon, who cannot be here today, and the noble Lord, Lord Cromwell, who I am glad to see is in his place. I also thank noble Lords across the House—I am extremely grateful, particularly for the Labour amendment of last Wednesday, so ably pressed by the noble Baroness, Lady Merron, which really remains the only man standing on the measures that might ultimately address market concerns on telecoms sites. I thank the noble Baroness warmly for that and pledge my support going forward. I pay tribute to the CLA, of which I am a member, the NFU, and other bodies such as Protect and Connect, which we have heard about, for their support and persistence.

Whatever the economic and political rationale, impressions matter and govern transaction analysis—and market confidence also, as we have seen recently in grand style. So I regret that, despite the Minister’s letter of today, a reasoned justification and clear evidence for further interventions into landlord and tenant practice are not apparent to me, especially looking at contractual terms beyond rent. Although as a property practitioner and fellow of the RICS, I believe that these measures are in that sense regrettable, divisive, avoidable and likely to cause the supply of mast sites to shrivel, I appreciate that the Minister demurs and disputes the evidence that has been put forward of lessor reticence, increased legal disputes and slower market process. So we will just have to see. Site providers in the market, their advisers and so on will have to take note, and they may become increasingly wary, not only for what this means in terms of mast rentals but for the wider implications for property rights going forward.

[Baroness McIntosh of Pickering (Con)]

I rise briefly to support the noble Earl, Lord Lytton, and to thank him and his Cross-Bench colleagues, the noble Earl, Lord Devon, and the noble Lord, Lord Cromwell, for the Cross-Bench support that we have enjoyed, together with that from the opposition Benches. My noble friend Lord Northbrook has also fought a valiant fight.

I thought it important from these Benches to place my regret that the 2017 electronic communications code has been harsher in its effects than had previously been anticipated. This was an opportunity to review that. So, while I did not support the Labour Front-Bench amendment, this is a good opportunity next door to consider whether there is cause, as I believe there is, to review the legislation at this stage.

I regret the imbalance in relationship that the Bill will expedite between the operators and landowners, many of whom are not private landlords but are sports clubs and others that will find the loss of income quite substantial and very difficult to replace at this time, in particular with the cost of living crisis and the inflation that we have seen. I regret that the alternative dispute resolution mechanism will not be mandatory; perhaps that is something the Government might like to consider when they look at this next door.

I will end on a local note. This is something that potentially could impact very positively in north Yorkshire. However, there are two issues that the Minister may not be aware of, as he is relatively new to this brief. One is that there are a number of existing masts owned by a specific telecoms operator that have not been operational. You have to ask the question, since the permissions have been given and the masts are in place, why on earth are they not being operated, in a place with one of the poorest levels of connectivity in the country. The other is looking at alternatives such as piggybacking on the back of the telecommunications masts that were put in place at public expense for the North Yorkshire Police service. I can see absolutely no reason why we cannot piggyback on the back of those.

With those few words, I wish the Bill well, particularly its Part 1—we will gloss over some of the later parts—as it proceeds in its passage through Parliament.

[Lord Kamall (Con)]

My Lords, I apologise as, in my quest to be concise, I did not name specific noble Lords and I think it is right that I do that. I thank the noble Baroness, Lady Merron, and the noble Lord, Lord Bassam, for their warm welcome. Indeed, it is a re-welcome from the noble Baroness, Lady Merron; many noble Lords will know that she and I have worked together before—we are inextricably linked. I also thank their adviser, Dan Stevens. I thank the noble Lords, Lord Clement-Jones and Lord Fox, and of course their adviser, Sarah Pughe. We take the credit for it, but these advisers work incredibly hard.

I acknowledge the continuing concerns of the noble Earl, Lord Lytton, and of other noble Lords who spoke on this issue. As I have said, I remain open to further meetings and am very happy to discuss these things. I commend the Bill to the House.