Procurement Bill [HL]

Baroness Neville-Rolfe Excerpts

Committee stage
Wednesday 6th July 2022 Grand Committee

It is quite clear that Ministers want to see competitive tendering, which is the normal way of getting good value for money. I cannot see any reason why buses, trains or the air service, which is in a later amendment, should not be put out to competitive tendering. There may be reasons for this, but we need the Minister’s explanation, because it all sounds so easy: “Everything will go fine. Ministers can be trusted”. I am sure that they can, but we do not know what will happen in five years’ time, when things could be very different. I believe that there will be a good reason for not applying the principle of competitive tendering in the railway legislation—the buses are slightly different—but we need the Minister to explain why all of these powers are necessary. I hope we can persuade him that a small reduction in the powers would give us better scrutiny and make sure that everything was above board.

[Baroness Neville-Rolfe (Con)]

My Lords, I support the noble Lord, Lord Wallace of Saltaire. I put my name to Amendment 18, and I am glad that the noble Lord, Lord Berkeley, did so too and that it is being debated with many other amendments about which I have a similar concern. It is right that this is a cross-party challenge to the Bill. It reflects the report of the Delegated Powers and Regulatory Reform Committee, now chaired by my noble friend Lord McLoughlin, and of course previously chaired by my noble friend Lord Blencathra. I do not think that I have ever seen such an excoriating report on the abuse of delegated powers.

This is a hugely important piece of legislation, affecting £300 billion a year of public money and its impact on those who supply it. That is nearly as much as the enormous sums spent and misspent on Covid. We now need much more information on the secondary legislation and regulations to be made under the Bill. Even if this is clarified and information is provided, my noble friend needs to bear in mind that he cannot bind a future Government or Prime Minister and their teams. Frankly, the regulatory and other delegated provisions before us are extremely dangerous and need to be reconsidered in the light of the DPRRC report and of course today’s debate and the answers that we are given. I am just sorry that we are not on the Floor of the House.

I will give a few choice quotations from the report. First, paragraph 20 says that

“in general [the relevant provisions of the Bill] leave the content of such notices, etc to be set out in Regulations”.

This includes notices about awards made without competitive tendering, the exclusion of suppliers and modifications or terminations.

Secondly, paragraph 23 says:

“We are also disappointed that the Government have provided no illustrative regulations. Illustrative regulations would have been very helpful and, without them, scrutiny of clause 86 is considerably hampered.”


This is delightful in its politeness, but it is very strong.

Thirdly, paragraph 33 says:

“The Government have failed to adequately explain”—


split infinitives would not be allowed in my day—

“why Ministers are to be given such a broad power to override the existing statutory bar on public authorities”.

This is an open-ended power to override primary legislation by order. The matters covered include: “conditions of employment” of a contractor’s workforce, “industrial disputes”, countries of origin and—this stuck in the gullet—

“political, industrial or sectarian affiliations or interests of contractors or their directors, partners or employees”.

This is utterly over the top, unless you are Mr Jeremy Corbyn, I suppose.

Finally, paragraph 53 says:

“The Government have failed to provide any justification for leaving entirely to regulations the question of which concession contracts for air services provided by air carriers are to be exempted from the Bill.”


From sitting in the Competitiveness Council of the European Union for several years, I can tell noble Lords that air services are big politically, and decisions need to be properly scrutinised by Parliament and not concluded by officials who tend—in my considerable experience—to exercise the power once matters are put into delegated legislation. There is also a vast shareholder base in aviation that should be quaking when it sees this Bill, if I have understood it correctly.

I apologise to my noble friend the Minister, with whom I have worked so well over the years, but resolving our challenge to these delegated powers is a real test of his mettle and of this Committee’s competence. They mean that the Bill is, in practice, regulatory, not deregulatory as we all hoped. I very much look forward to supporting my noble friend the Minister and others in making some very necessary changes to the Bill.

[Lord Blencathra (Con)]

My Lords, it is a pleasure to speak after my noble friend Lady Neville-Rolfe and after listening to the speech of the noble Lord, Lord Wallace of Saltaire. They have gone through each of the individual recommendations of the Delegated Powers Committee’s report and each of the amendments, which saves me having to quote from them as well, so I will speak in more general terms.

I did not speak on Second Reading, because a quick look at this Bill convinced me that the delegated powers report would be worth waiting for—and what a scorcher it turned out to be. Now that I am no longer committee chairman, I can speak more bluntly than I have in the past, even though I might not now get a phone call from No. 10 asking me to form a Government of national unity tonight. I fully support the concept of the Bill, but it is an appalling mess. I exonerate my noble friend the Minister, who had no part in drafting it, but how on earth can officials and the Office of the Parliamentary Counsel—the OPC—spend two years coming up with these shambles where 345 government amendments—my count on Monday—are necessary? However, what concerns me today is not the shambolic drafting but the abuses of parliamentary protocols as evidenced in the Delegated Powers Committee’s report.

Last year, the Delegated Powers Committee and the Secondary Legislation Scrutiny Committee published two reports: Democracy Denied? and Government by Diktat. We produced countless examples of legislation presented to the House with very wide regulatory powers granted without any justification for them, but with the usual excuse: “just in case they might be needed one day”. The reports cited “skeleton legislation” and clauses where the policy had not been thought through. In addition, powers were being taken to fill in, not just the details, but the general principles which should have been in the primary legislation and not in secondary legislation.

Then we have the negative procedure applied in completely unacceptable cases where the affirmative should be used, such as increasing penalties or charges, for example. Then, of course, we have the dear old Henry VIII powers attached almost automatically now to almost every Bill without any thought. No, I correct that—the thought among Bill teams and drafters is that the department can change any primary legislation it likes in future without having to go through the hassle of producing new primary legislation and getting approval for it. What a marvellous “Get out of jail free” card this is: change any legislation at the stroke of a Minister’s pen.

In this Bill, the Delegated Powers Committee has drawn attention to all these gross abuses and—let us face it—they are abuses. Just because Governments have got away with treating Parliament with contempt in the past does not mean that this should be the norm. I will quote only one paragraph from the Delegated Powers Committee’s report. Before doing so, I note that the committee is not hostile to this Government or any Government; indeed, it is now chaired by one of the longest-serving Commons Conservative Chief Whips in history, and so it is not a partisan committee. Paragraph 7 says:

“This report identifies multiple failures in the Memorandum to adequately explain and justify very broad delegations of power which enable implementation of significant policy change by delegated legislation. This would give us cause for concern at any time but is particularly disappointing as it comes so soon after the publication of our report, Democracy Denied? The urgent need to rebalance power between Parliament and the Executive, in November 2021, and of revised guidance for departments on the role and requirements of this Committee.”


The new guidance by the Delegated Powers and Regulatory Reform Committee was circulated to all departments, and, in the first week of January, I personally wrote to every Minister and every permanent secretary giving them copies of the revised guidance. This is a Cabinet Office Bill, so I want my noble friend the Minister to go back to the Cabinet Office and call in Simon Case, the Cabinet Secretary, Alex Chisholm, the Permanent Secretary, and Elizabeth Gardiner, the First Parliamentary Counsel, and ask them why they seem to have deliberately ignored every word of the guidance with which they were issued.

Worse than that, they have reneged on their promises to the committee. In the response to our report, they said that the Government agreed that the statement of principles of parliamentary democracy set out in both our reports should be included in the Cabinet Office’s Guide to Making Legislation. We reported way back last December, so they have had five months to adjust the Bill taking that into account. Why have they not done so?

The Government agreed that the routine use of just-in-case powers was not appropriate, so why include them in the Bill? They agreed that guidance should not be used to create rules that must be followed, should not be relied on for interpretation of legislation, and should describe the law accurately. They said that the Cabinet Office’s Guide to Making Legislation would be strengthened to reflect the committee's revised guidance. Will my noble friend the Minister ask why that has not happened? I am tempted to ask the non-executive board member, the noble Lord, Lord Hogan-Howe, to maybe conduct an investigation into the Cabinet Office, but I will keep that in reserve.

Of course, the Government justified skeleton legislation, Henry VIII powers and the negative procedure even when there were alternatives that would not subtract from the thrust of the legislation. Not one single item in any of the DPRRC reports would stop any Government of any persuasion driving through their programme. At worst, it would mean a Minister—usually a Lords Minister—perhaps having to do a few more 90-minute SI debates.

I conclude with something the Government did agree on. They welcomed the end-of-Session report that the Delegated Powers Committee said it would produce. The committee has now produced the first end-of-Session report, even though it covers only half or less than half of the last Session, and it makes for some very uncomfortable reading for some Bill teams and OPC drafters. It criticises the quality of delegated powers memoranda by the Ministry of Justice, and two of those by BEIS and the Home Office each. If we cannot trust the delegated powers memoranda, how can we trust the rest of the departments’ assertions?

The report highlights serious deficiencies in the Health and Care Bill, describing it as

“a clear and disturbing illustration of how much disguised legislation a Bill can contain and offends against the democratic principles of parliamentary scrutiny.”

However, by far the most egregious and insidious example was the Subsidy Control Bill, which had a delegated power which enabled the Government to disapply the Bill’s subsidy control requirements by a direction that had to be kept secret from Parliament. Added to which, the delegated powers memorandum had the effrontery, and indeed the honesty, to justify this absence of parliamentary scrutiny on the grounds of

“the potential for non-approval by Parliament”

—in other words, a risk of defeat.

Can noble Lords believe that? Noble Lords who were on the committee can believe it, because they had it removed eventually. Officials drafted provisions to enact a law in secret and not tell Parliament in case Parliament voted against it. We do not have that in this Bill, but I am quoting some general examples to show how appalling some of the general delegations of power have been.

Of course, Ministers have ultimate responsibility, but we all know that Ministers were not responsible for the 345 government amendments in this Bill. Nor are they the ones who have devised and insisted on inserting all these parliamentary abuses into legislation. I suspect that my noble friend the Minister was as shocked as the rest of us when he was handed this Bill and saw the extent of the completely inappropriate delegation of powers.

I want him to go back to the Cabinet Office and tell officials and parliamentary drafters that if they do not want their names on the list of bad boys and girls when the DPRRC publishes the full report at the end of this Session, they had better bring in the changes on Report, as suggested by the Delegated Powers Committee. They should amend the Bill not only to keep their noses clean but because it is the right, democratic thing to do.

--- Later in debate ---

[Baroness Neville-Rolfe (Con)]

I want to express a concern. Although the Minister’s argument seems to be that the powers are already rather limited and that there are natural limitations—for example, the GPA—I am not convinced that we actually need to put all this into delegated legislation. In some places, we could decide things and make it clear in the Bill. Then, if there is future evolution of the market or the development of technical regimes, as my noble friend suggests, we should come back to the House and look again at legislation in those areas.

Obviously, I come from a business background, and, as I said, the thought that officials can effectively make major changes that will affect the market in which you are operating is actually quite worrying. We had an example of this on Monday. The example we received from the noble Baroness, Lady Hayman of Ullock, about

“a tool to cover imperfect policy development”

was a quote from the report in relation to private utilities. Therefore, I did not repeat it, but it is a good example of where there might be a changing market, which might then generate quite substantial uncertainty in the procurement field and be a big problem for our companies.

I took four egregious examples out of a respected cross-party report to try to be constructive, but my noble friend has unfortunately tried to explain why the Bill is as it is, rather than to respond to these individual examples. I really need his response to these examples because I need to know how much to press on things such as notices and concessions when we get to those parts of the Bill. If it is clear that the delegated powers cannot be misused, it makes it a lot easier to agree to other parts of the Bill. I apologise to the Committee for speaking at length, but I feel very strongly about this.

[Lord True (Con)]

My Lords, it is Committee and my noble friend and all other noble Lords are entitled to intervene as much as they wish. She makes an important point, and I was just on that paragraph in my speech—it is slightly small compared to the rest of the speech—and was trying to set out the Government’s rationale for why the balance is probably right.