Peerages: Letters Patent

Baroness Neville-Rolfe Excerpts

Thursday 17th November 2022 Lords Chamber

[Lord Blunkett (Lab)]

I beg leave to ask the Question that has stood in my name for four weeks on the Order Paper.

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

The Government are aware that there is some precedent for individuals deferring taking up their seats in the House of Lords—for example, by agreeing a delay in the issue of Letters Patent. However, that is limited and largely reflective of personal circumstances. As the noble Lord will know, advice between the Prime Minister and the sovereign is confidential.

[Lord Blunkett (Lab)]

My Lords, perversely, the topical Question granted for yesterday helps us to clarify the Government’s position, not least on the difference between an MSP and a Member of the House of Commons, and the constitutional position and implications, not least for the monarch. Let me ask a very simple question: will the Government support tomorrow the Private Member’s Bill, which will be proposed by the noble Lord, Lord Norton of Louth, to strengthen the House of Lords Appointments Commission?

[Baroness Neville-Rolfe (Con)]

I very much sympathise with the noble Lord, in that his Question is being answered today rather than yesterday, and I very much look forward to participating in the debate tomorrow on the Private Member’s Bill proposed by the noble Lord, Lord Norton. The Government have no plans to change the status of the House of Lords Appointments Commission. It is an independent non-departmental public body, as noble Lords will know, and the Prime Minister is democratically accountable. As I said yesterday, we do not believe that appointments should be determined by an unelected body—but, of course, we will be listening and participating in the debate secured by the noble Lord, Lord Norton.

[Lord Wallace of Saltaire (LD)]

My Lords, the Minister yesterday asserted the principle that the Government are entitled to have a similar majority in the Lords to the Commons, but that is not a principle that was understood in the last partial reform of the Lords in 1999. Indeed, the then Labour Government survived with fewer Peers in the Lords than the Conservatives for many years afterwards, and the noble Lord, Lord Strathclyde, as Leader of the Conservative Opposition, carried a great many votes against the then Government.

Could the Minister take us a little further on that principle? Does she assume that, in the event of a change of Government, it would be appropriate for the Conservatives to retire enough Peers to enable the new Government to gain an alternative majority, or does she think that the House will then have to go towards 1,000 Peers?

[Baroness Neville-Rolfe (Con)]

As I said yesterday, I am not willing to speculate on what might or might not happen after a future general election. However, I repeat that the Conservative Party, despite winning a succession of elections, has still only 34% of the seats in the House of Lords. It is interesting that 408 Members were appointed over the 13 years from 2010, and 404 Members have been appointed over the 12 years between 2011 and 2022.

[Lord Sherbourne of Didsbury (Con)]

My Lords, can my noble friend the Minister confirm that, when the Prime Minister of the day is considering honours, one of his responsibilities is to maintain the integrity of the honours system?

[Baroness Neville-Rolfe (Con)]

My noble friend makes a very good point, which I am happy to endorse.

[Lord Morris of Aberavon (Lab)]

My Lords, the late noble and learned Lord Mayhew and I, as ex-Attorney-Generals, gave evidence to this House’s Constitution Committee that the Government could not rely on the royal prerogative to go to war as it was outdated, and the committee agreed. The committee chaired by the noble Lord, Lord Burns, did not make any suggestions on how to stop a Prime Minister proposing increases in membership of this House. Will the Government consider referring to the Constitution Committee the use of the royal prerogative to recommend peerages, as its unlimited use is similarly outdated?

[Baroness Neville-Rolfe (Con)]

I do not see it quite that way. We have retirements and departures, and we support the continuation of encouraging more retirements. I think that the Liberal Democrats in particular have not as many retirements as some other parties. As we have said, we look more broadly at the role of the Lords, but it is an important point that significant measures—which I think could stem from the noble and learned Lord’s question—on the size and composition of the House of Lords are a matter for the democratically elected Government. Of course, the House and committees have a role in offering advice, but significant changes have to be for the Government of the day.

[Lord Cromwell (CB)]

If the Minister is unable to answer this question, could she at least reflect on it? Should a peerage be allocated to somebody who is a sitting MP and they subsequently blot their copybook, will the Government rescind their peerage, or ask the monarch to do so? Have we also completely now abandoned the process of two out, one in?

[Baroness Neville-Rolfe (Con)]

On the point of sitting MPs, as I said yesterday, the sort of reports that have led to this debate are rumour and speculation. However, we will of course reflect on the debates we have and have had here—yesterday, today and tomorrow.

[Lord Collins of Highbury (Lab)]

I would like the Minister to remind me when it was that Prime Minister Boris Johnson resigned. When was it? Then, we know that the speculation that has been talked about is about a resignation list, not an honours list and not nominations—we had nominations recently. That is the speculation. She keeps saying that the Prime Minister takes responsibility. Will Prime Minister Sunak admit responsibility for this list, and will he stop and make sure that he does not put His Majesty in this invidious position, because it will bring disgrace on the Government and disgrace on His Majesty?

[Baroness Neville-Rolfe (Con)]

It is a convention that has been observed by successive Governments that a resignation honours list can be put forward by a departing Prime Minister. It can take a bit of time: I think that Theresa May and John Major took a few months to put their resignation lists together. They are then forwarded to the Prime Minister of the day. The practice now is that the House of Lords Appointments Commission looks at proposals and makes recommendations, which are taken into account by the Prime Minister in the confidential advice that he offers the sovereign.

[Lord Butler of Brockwell (CB)]

My Lords, I am sure that before tomorrow’s debate the Minister will study the Bill proposed by the noble Lord, Lord Norton, and I think she will see that it does not propose that the Appointments Commission should determine membership of this House but that that responsibility should remain with the Prime Minister.

[Baroness Neville-Rolfe (Con)]

I am so grateful to my former boss for that excellent point of clarification. I shall listen very carefully throughout the Norton debate, and bear in mind the need to look at the detail and be very careful.

[Lord Foulkes of Cumnock (Lab Co-op)]

May I suggest that the Minister visit the Members’ Cloakroom downstairs, where she will see eight red boxes containing seals that have not been collected by a number of Peers, including the noble Lord, Lord Lebedev? Would one way of achieving the excellent proposal from the noble Lord, Lord Burns, for reducing the size of this House be to find a way to get rid of the Peers who fail to turn up regularly without reasonable excuse?

--- Later in debate ---

[Baroness Neville-Rolfe (Con)]

I cannot agree with that. Like others, the noble Lord, Lord Lebedev, was nominated on his contributions to society and that included his understanding, obviously, of Russia; but also, he has been extremely critical of the murderous Putin regime. He—

[Noble Lords]

Oh!

[Baroness Neville-Rolfe (Con)]

Let me finish. He, like other Members who turn up less than the rest of us, brings a difference perspective. I was present for his maiden speech. The point about the House of Lords is that it is a part-time House and some people bring other aspects and contributions which are not on the Floor of the House.

[Lord Baker of Dorking (Con)]

In answering the Question yesterday and today, the Minister mentioned that when, in the past, Members of the House of Commons have been nominated for a peerage, it has in a very few cases been postponed “for particular reasons”, I think her phrase was. Who determines the particular reasons? Would it be a Minister of the Crown, in which case it would be subject to judicial review, would it not?

[Baroness Neville-Rolfe (Con)]

I think I was trying to make the point that it is down to the particular circumstances of the individual. In the cases in question—I think there were three or four, and I will not go into them—the particular circumstances and needs of those involved, for example, being a Member of the Scottish Parliament, meant that a deferment was possible and appropriate.

Parliament: Deferred Peerages

Baroness Neville-Rolfe Excerpts

Wednesday 16th November 2022 Lords Chamber

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

My Lords, it is a common-law principle that Members of the House of Lords cannot sit as MPs and, as such, would need to stand down from the House of Commons. The Government are aware that there is some precedent for individuals delaying taking up their seats, but this is limited and largely related to their personal circumstances.

[Lord Cormack (Con)]

Well, my Lords, we are all grateful for that Answer as far as it goes, but perhaps I might suggest to my noble friend that these rumours and stories in the press—which have the real sniff of authenticity—could, to mix my metaphors, be nipped in the bud. Does my noble friend agree that it would be very wrong for the Government to place the monarchy in an invidious position, and that it would be very wrong to create what would, in effect, be a precedent: to have a list consisting of a number of Members of the other place? Would my noble friend come forward later with a much more emphatic Answer that does indeed put an end to all the speculation?

[Baroness Neville-Rolfe (Con)]

I will start by saying that we do not comment on leaks and rumours—but I agree that it is a core constitutional principle that the monarch is never drawn into party politics. I think we all very much agree on that. As far as individual proposals and speculations are concerned, no list has been confirmed and I will not go any further in adding to the speculation.

[Baroness Smith of Basildon (Lab)]

My Lords, it is one thing, as the Minister says, when someone, for personal reasons, genuinely cannot take up a seat in the House of Lords that they have been awarded, but will she recognise that it is completely unacceptable, if the rumours are true, to create a situation where four Members of Parliament hang onto their seats in the other place but can jump into this House at a time of their choosing, or at a time that is more convenient for their political party? The Prime Minister could stop this in its tracks: will he?

[Baroness Neville-Rolfe (Con)]

I do not think I can add to what I have said already. It is very important not to believe what you read in the newspapers; sometimes they are right and sometimes they are wrong. A list has not been confirmed, and it is not appropriate or fair for the Government to speculate—or encourage speculation—on names that may or may not have been nominated or vetted. We need to be fair to those being considered.

[Lord Wallace of Saltaire (LD)]

My Lords, in the last manifesto that the Conservatives came up with, there was a commitment for a commission on the constitution to consider questions such as the future of the House of Lords and the next stage of reform. By the time of the coming election, there will be room for another 20 to 30 net Conservatives being nominated, so clearly the House would become unbalanced again.

--- Later in debate ---

[Lord Wallace of Saltaire]

I mean unbalanced in favour of the Conservatives, of course. What does the Minister think might be in the next Conservative manifesto about the next stage of necessary reform of the House of Lords?

[Baroness Neville-Rolfe (Con)]

I cannot even speculate on the next Conservative manifesto, but I can of course point out that, in spite of winning elections since 2010, the Conservative voice is still underrepresented in the Lords.

[Noble Lords]

Oh!

[Baroness Neville-Rolfe (Con)]

As of November 2022, the Conservative party still has only 34% of the seats and recent appointments have not moved the dial. Indeed, I should point out that, when lists are brought forward, potential Peers from other parties are also considered, as was the case when they were included on the recent list, and I am very happy to welcome some of these fresh faces to our Chamber to help with our debates.

[Lord Judge (CB)]

My Lords, I have nothing whatever to do with whether there are too many of which party in the House. If the Minister cannot comment on the future, perhaps I can go back over the history of, say, the last 25 years. Has the time perhaps come when the exercise of the royal prerogative by the Prime Minister should be subject to some sort of legislation? If it is not subject to some sort of legislation, who on earth is ever going to control him or her?

[Baroness Neville-Rolfe (Con)]

The way this works is that the Prime Minister, of any colour, is democratically accountable and appointments to the House of Lords are a matter on which he or she advises His Majesty the King. In my view, and this is the Government’s view, appointments should not be decided by, for example, an unelected body.

[Lord Forsyth of Drumlean (Con)]

My Lords, when Caligula appointed his horse as a consul, it was in order to discredit the institution. Is there not a danger that this is happening here?

[Baroness Neville-Rolfe (Con)]

My noble friend always comes to my rescue in the most extraordinary way. Of course, we are grateful for the views and exchanges being expressed today, but I come back to my first point: it is important not to speculate on what is put forward in newspapers and so on. I always remember when I was in the newspapers because I was going to be appointed director-general of the Confederation of British Industry, when I had not even put my name forward. There is a matter of fairness and appropriateness that we need to take into account—despite the fun we are obviously having in debating this today.

[Baroness Hayter of Kentish Town (Lab)]

My Lords, this is a serious legislature; this is not a playground for former friends of former Prime Ministers to come here at a moment of their convenience. We have had the Burns report and know that we should be smaller to do our job properly. Will the Minister ask the Prime Minister to meet the Burns committee—I have not asked committee members whether they would be willing—to concentrate on the important thing, which is enabling us as a serious legislature to do our job properly, with fewer Members, rather than having people waiting to come in after the next election?

[Baroness Neville-Rolfe (Con)]

The Burns committee did of course report and the Prime Minister of the day, Theresa May, decided not to sign up to its recommendations—although, as has been said, there was a manifesto commitment to look at the role of the Lords, with any reform needing careful consideration and not being piecemeal. We obviously also have the very important House of Lords Appointments Commission. Upon taking office, it is the normal thing for the Prime Minister of the day to meet the chairman of HOLAC, as he or she values the advice of the commission, which obviously includes Members of this House.

[Lord Grocott (Lab)]

My Lords, can the Minister explain this concept of “deferred peerages”, which is completely baffling to me? The position is surely that you become a life Peer only when Letters Patent are issued. If you are a sitting MP, Erskine May declares quite clearly that you have to give up and cease to be an MP from the moment that Letters Patent are issued. Is it simply the case that this furore is because a Prime Minister has said to various colleagues, “You’ll become a Peer at the next general election, whenever that might be”? If that is the case, surely there is no obligation whatever on any incoming Prime Minister to abide by a decision a previous Prime Minister has made?

[Baroness Neville-Rolfe (Con)]

It is for the Prime Minister of the day to advise the sovereign on proposals for peerages, as the noble Lord has said. If the House will bear with me, I could mention two obvious precedents if that would be helpful. One was my noble friend Lady Davidson of Lundin Links—

[Baroness Smith of Basildon (Lab)]

She was not an MP.

[Baroness Neville-Rolfe (Con)]

She was an MSP—but the point is that she was nominated in Boris Johnson’s Dissolution List of 31 July 2020 and her Letters Patent, to respond to the noble Lord, were issued on 16 July 2021. She was introduced to the House later that month.

[Lord Foulkes of Cumnock (Lab Co-op)]

It is a different Parliament.

[Baroness Neville-Rolfe (Con)]

The point I was making right at the beginning, which I will reiterate, is that the Government are aware that there are some precedents for individuals delaying taking up their seats. However, this is limited and related, as in this case, to particular circumstances.

Greenhouse Gas Emissions: Developed Countries

Baroness Neville-Rolfe Excerpts

Monday 7th November 2022 Lords Chamber

[Baroness Sheehan]

To ask His Majesty’s Government, further to the recent flooding in Pakistan, what steps they are taking as president of COP26 (1) to acknowledge, and (2) to address, the effects of greenhouse gas emissions by developed countries.

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

First, I express my heartfelt sadness at the horrifying events resulting from the flooding in Pakistan. The UK has committed £26.5 million in humanitarian funding to help support the people of Pakistan as they rebuild from this terrible event. At COP 26, parties recognised that loss and damage are already impacting lives and livelihoods and agreed to scale up support to address this issue. An agenda has now been agreed for COP 27 this week and next, with a specific item on loss and damage. New news today is that the UK Government will commit to triple funding for climate adaptation, up from £500 million in 2019 to £1.5 billion in 2025, which will of course help countries such as Pakistan and Somalia.

[Baroness Sheehan (LD)]

I thank the Minister for her Answer. The World Meteorological Organization reports that greenhouse gas emissions are at historic highs, with a worrying, unexplained spike in methane—a greenhouse gas which is 20 times more potent than carbon dioxide. Countries such as Pakistan, those of east Africa and low-lying island states are responsible for a minuscule amount of current emissions and practically none of the historical emissions, yet they are in the front line of the extreme weather events that are a direct consequence of those emissions. First, now that the Prime Minister is going to COP 27, will the Minister urge him personally to intervene and make sure that the loss and damage agenda sees some progress there? Secondly, does she regret that we have missed our own target for the Green Climate Fund this year by $288 million?

[Baroness Neville-Rolfe (Con)]

The good news is that the Prime Minister is at COP 27 today. He has been speaking and will make announcements, one of which I have just mentioned. While I cannot go into the detail of what kind of negotiations will go on on loss and damage, we have announced funding of £5 million for the Santiago network as a demonstration of our commitment to this issue. The points the noble Baroness makes about the particular circumstances of Pakistan are interesting ones which I will take away.

[Lord Howell of Guildford (Con)]

The Pakistan situation is clearly appalling. However, would my noble friend agree that at COP 27, rather than concentrating solely on reaffirming targets, which, frankly, may never be met, or loss and damage grants, which may never be decided, let alone paid, and while emissions worldwide continue to rise very rapidly, there is a much stronger case for focusing on innovative new world schemes for extracting carbon out of the atmosphere and absorbing it directly? Will she reassure us that the UK Government will look at these new schemes and take the lead where they can in a full and constructive way?

[Baroness Neville-Rolfe (Con)]

I thank my noble friend for his constructive suggestion. I believe in the power of technology. The point he makes about carbon capture and storage is absolutely on the money. We have seen leaps forward which have helped us with tackling climate change on everything from electric vehicles to wind turbines, solar power, LED lighting, hydrogen and new nuclear. Carbon capture and storage are in the same category. Areas like these are where businesses can come together with Governments to innovate, drive things forward and then get them copied in lots of different countries around the world. Climate change is an international phenomenon; sadly, carbon and greenhouse gas emissions have no borders.

[Baroness Boycott (CB)]

My Lords, last week we had a briefing from the President of the Maldives. He pointed out that, of the 100% of GDP, they spend 30% on adaptation due to the fact that the islands are being trashed by hurricanes and sea-level rises, and they are spending a further 25% on debt relief—the debt that they incurred in building infrastructure, roads and hospitals, which are now being washed away by the climate crisis. Do the Government think that there is any value in trying to work towards debt relief for nations such as this, given that the international community cannot yet come up with the £100 billion that we agreed last year in Glasgow for situations just like this?

[Baroness Neville-Rolfe (Con)]

We are open to innovative solutions. This is another one that has come forward from the Maldives, which I have only just heard about. It is obviously right that hurricanes and monsoons and things make it difficult for countries such as the Maldives and other small islands to deal with their debts; in any financing, we would need to make sure that the result helped with climate change alleviation, but I am very happy to learn more.

[Lord Anderson of Swansea (Lab)]

My Lords, the Question points the finger of blame solely at developed countries. Does the Minister agree that it is not just developed countries, but also countries such as China and India, whose leaders have failed to attend the conference at Sharm el-Sheikh? Does the fact of their non-attendance suggest a lack of commitment and engagement on their part?

[Baroness Neville-Rolfe (Con)]

The attendance of the UK delegation—which includes the Prime Minister, the Foreign Secretary, the Environment Secretary, my noble friend Lord Goldsmith from our House, Graham Stuart MP, and, indeed, a former Prime Minister, Boris Johnson—shows the seriousness of this matter. To be fair, we have these big COPs, as we had in 2015 and as we were honoured to chair last year, and not all world leaders go to every COP every year. Of course, if action on climate change is going to work—for exactly the reasons that I have already articulated, in terms of there being no borders for greenhouse gas emissions—it is absolutely essential that China, India and other big emitters step up to the plate and deliver on what they have promised and, indeed, even more.

[Lord Collins of Highbury (Lab)]

My Lords, the Minister mentioned Boris Johnson. What has happened to Britain’s global leadership since Glasgow? Boris Johnson said today that he is there in a purely supportive role, but he also said that Britain should not pay reparations for climate change. This was in complete contradiction to the Prime Minister’s announcement today that we should enter into discussions about this question. Can the Minister tell us what the Prime Minister needs to do to make sure that his words are credible?

[Baroness Neville-Rolfe (Con)]

I do not like the direction of that question. However, we have encouraged discussion on loss and damage. Obviously, the Labour Party has come out with a big initiative on reparations—which is not funded—and it is very important that we join in the discussion of loss and damage to try to find a joined-up way forward, with support from around the world. The whole problem about climate change, as I have said in the House so often, is that it is an international challenge as well as a domestic challenge.

[Baroness Bennett of Manor Castle (GP)]

My Lords, following on from the question on loss and damage, the Minister said that it was really important that there is discussion. Have we not utterly arrived at the time when we need action, given that loss and damage was kicked into the long grass, taken out of the Glasgow climate pact and put into the Glasgow dialogue instead? Denmark has promised loss and damage money; Scotland has promised loss and damage money; and the Belgian region of Wallonia has promised loss and damage money. If the Government want to be world-leading, when are we going from discussion to actual action and a promise of money? It is not the same thing as adaptation finance.

[Baroness Neville-Rolfe (Con)]

In my experience, you can only get action, especially in an international context, if you have constructive discussion. In terms of our contribution, the UK spent £2.4 billion on our international climate finance between 2016 and 2020 on adaptation and investment in areas that needed to address loss and damage. The Scottish Government fund is £2 million.

[Lord Purvis of Tweed (LD)]

My Lords, there is no point in offering the least-developed countries support for loss and damage if our Government are removing funding from other areas of that community. For all the figures that the Minister has stated today from the Dispatch Box, how much is new money and how much of it is simply reallocated from the arbitrary cap of 0.5%?

[Baroness Neville-Rolfe (Con)]

We made very generous commitments to funding on climate change last year. We are sticking to those; the Prime Minister made it clear on the steps of Downing Street that he regarded protecting the environment as very important. Sometimes you change the priority which you give to different aspects of the climate change matter, but that is the way to move forward and do things better, and the announcements that have been made today are directed exactly at that. I am delighted at the progress that is being made today, but the question is whether the discussions will deliver what we want over the next two weeks. We look forward to reporting on that when COP 27 ends.

Ministers: Government Business

Baroness Neville-Rolfe Excerpts

Wednesday 2nd November 2022 Lords Chamber

[Baroness Jones of Moulsecoomb]

To ask His Majesty’s Government what further steps they will take to ensure that ministers do not use private (1) mobile telephones, and (2) email accounts, for conducting government business.

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

The Government have robust systems in place to protect against cyber threats and we are vigilant in ensuring that these are up to date and meet the challenges of the modern world. Just yesterday, the Security Minister announced that he was establishing a new task force from across departments, the security and intelligence agencies, the private sector and civil society to meet these big challenges. All new Ministers receive a general security briefing in their first weeks in government. The National Cyber Security Centre and government security officials then regularly provide Ministers with specific advice on protecting personal data and managing online profiles, as well as on best-practice guidance.

[Baroness Jones of Moulsecoomb (GP)]

But the system is not robust, as the Minister claims. The previous Prime Minister had her phone hacked. The Home Secretary leaked classified information and, during the early days of Covid, Johnson, the Prime Minister, used a phone that then was lost with all messages unobtainable. At this rate, we are going to have to ask the Russian secret services for all the details about where and when ministerial decisions were made. [Laughter.]

--- Later in debate ---

[Baroness Neville-Rolfe (Con)]

I do not think it is right to laugh.

[Noble Lords]

Oh!

[Baroness Jones of Moulsecoomb (GP)]

I am not laughing.

[Baroness Neville-Rolfe (Con)]

Good. The Government take matters of security very seriously. Of course, I am not going to comment on individual cases—that would not be appropriate—but I draw attention to the fact that the Home Secretary has provided a very detailed account, step by step, in a very full letter to the Home Affairs Select Committee and, of course, she apologised for her error and resigned. The Prime Minister has now appointed her to do a very important job.

[Baroness Smith of Basildon (Lab)]

My Lords, the noble Baroness will be aware that the former Prime Minister, Boris Johnson, and his entire Cabinet at that time, many of whom are now back in the Cabinet, were warned in 2019 not to use their personal phones for business but it appears that some continued to do so. Can the Minister confirm what guidance was given to Cabinet Ministers at that time? Is it still being given to Cabinet Ministers? How is that guidance being enforced and is not obeying those rules a breach of the Ministerial Code?

[Baroness Neville-Rolfe (Con)]

I will not, of course, comment on the particular; however, it is the case that government systems should be used, as far as practicable, for government business. The guidance issued and kept under review does not rule out the use of different forms of electronic communications in some circumstances. There has to be a place for a variety of digital channels. Ministers have informal conversations from time to time and they have to use a variety of digital communications for personal, political and parliamentary matters.

[Lord Scriven (LD)]

My Lords, Ministers have said that they are conducting government business on Signal, a messaging app that deletes messages after five seconds and can block screen grabs. How is this compatible with official rules on the use of private devices for such business, particularly when having to send copies of messages to civil servants?

[Baroness Neville-Rolfe (Con)]

As I said, government systems should be used as far as practicable. In some cases it is not possible to do that, and in some cases it is not appropriate—for example, changing the time of a meeting can be done perfectly well in this digital world. Having said that, the Cabinet Office has previously published guidance on how information is held; it is always being looked at and updated to reflect modern forms of working and technology—and, of course, the changing threat. Cyber and technology are changing all the time, which is why this work is so important and why I mentioned the task force set up under Minister Tugendhat.

[The Lord Bishop of Leeds]

My Lords, I sympathise over the complexity of this matter, particularly given the technological developments, but there is the question of principle, which does not particularly relate to the recent cases cited. Several decades ago, when I was at GCHQ, the slightest security misdemeanour meant that you lost your job. Does that principle—that making a serious security error has consequences and a simple apology will not do—still apply? I cannot think of another circumstance in which an apology would have sufficed.

[Baroness Neville-Rolfe (Con)]

I am glad that we have the advice of somebody who used to work at GCHQ; it shows the breadth of this House and what we are able to do on security. I have explained that the Home Secretary apologised and that she resigned. We have discussed before that she has come back—you can have redemption in this life. You need to have respect for security and make sure that you are ahead of the game but, occasionally, you also need to be able to say, “I did the wrong thing”, and you need to be forgiven.

[Lord Cormack (Con)]

My Lords, some of us think that government was rather more efficient before the advent of social media. Would not it be a good idea to make twittering an offence?

[Baroness Neville-Rolfe (Con)]

I think you might not be the most popular person in the world, if you made twittering an offence.

[Noble Lords]

Tweeting!

[Baroness Neville-Rolfe (Con)]

Tweeting has a place in modern news communication. The point that we all need to understand—and I assure noble Lords that, as a new Minister, I have taken the briefing that I have had very seriously—is about when you can use social media and non-government communications and when you need to be very careful. Of course, in some cases you cannot even use official digital communication for secret stuff; it has to be looked at in a particular location and on paper.

[Lord Forsyth of Drumlean (Con)]

Is Halloween not over and is it not time that this witch hunt ended?

[Baroness Neville-Rolfe (Con)]

I agree. Since I came to the Dispatch Box—I am sorry that I have lost my voice—I have been trying to move the debate forward. That is why I was emphasising the role of the UK on cybersecurity, which is an impressive one. I know, because I had to attend three days of a cybersecurity conference in Singapore while Secretaries of State were busy on other matters. I found that the UK’s work was highly respected and took a great deal of comfort from that. It is very important that we invest in the future and support the task force that has been set up and is going to draw on expertise from across the House.

[Baroness Smith of Newnham (LD)]

My Lords, it is good to know that the Minister has had training on security but yesterday’s i suggested that some of the UK’s closest allies are so concerned about the Government’s use of repeated use of personal devices for government business that they are beginning to consider what security briefings they should make available to the United Kingdom. Is that not a reason why her colleagues in government should think again about using personal devices for government business?

[Baroness Neville-Rolfe (Con)]

I am always careful to question individual reports, but I repeat that we take a leading role on the global stage in countering state threats, and we will continue to work closely on this with like-minded allies and partners to defend UK interests, and the international rules-based system, from hostile activity.

[Lord Griffiths of Burry Port (Lab)]

My Lords, the Minister has told us that she is unwilling to talk about case histories and so on, although she has given us a pretty fulsome step-by-step report on the Home Secretary’s resignation and reappointment. In view of the fact that she began by telling us from the Dispatch Box today that this is not a laughing matter—that it is very serious—and the sober words from the right reverend Prelate about his experience of GCHQ and the seriousness of these lapses, can she confirm from the Dispatch Box that to describe what we are going through as a witch hunt is inappropriate?

[Baroness Neville-Rolfe (Con)]

I note what the noble Lord says, but I must say that I have some sympathy with my noble friend Lord Forsyth: we really need to move forward. I went into detail on the Home Secretary only because she wrote a letter in great detail, which I think is of interest to people who take an interest in these matters. We need to move forward and to support those in the security services and others trying to defend national security and, even more importantly, anticipate the new threats coming at us all the time. The digital world is changing, as I know from my recent trip, and we have to work to strengthen defences, but in a reasonable, sensible way.

COP 27

Baroness Neville-Rolfe Excerpts

Thursday 27th October 2022 Lords Chamber

[Lord Dubs]

To ask His Majesty’s Government who will represent the United Kingdom at the COP 27 conference in Egypt.

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

My Lords, the UK will have a strong delegation at COP 27, including the Foreign Secretary and several other Ministers, who will engage with international counterparts on the transition to net zero and climate resilience. Alok Sharma MP was reappointed COP president on 25 October, leading the UK’s contribution to the successful implementation of the historic Glasgow climate pact. We also expect a significant presence on the part of civil society and business, building on their participation in Glasgow last year.

[Lord Dubs (Lab)]

My Lords, I welcome the Answer from the Minister that the Foreign Secretary and other senior Ministers will be attending, particularly in the light of the comments made yesterday by the Secretary-General of the United Nations about how important it is that we keep climate change in our sights. Can the Minister comment on one further thing? Apparently, according to the media, the previous Government said that they did not want His Majesty King Charles to attend COP. Can she make it clear that if the King wants to attend, he will be welcome to do so?

[Baroness Neville-Rolfe (Con)]

My Lords, I should start by saying that His Majesty is globally recognised for his foresight and leadership on climate and sustainability over five decades—in fact, well before these issues became mainstream. However, the Government do not comment on communications and advice between our Prime Minister and the monarch.

[Lord Cormack (Con)]

My Lords, that is entirely understandable, and one would not expect my noble friend to say anything else. Nevertheless, I think it is a widely held view in this country that His Majesty would give great extra prestige to this conference merely by his presence. If that message could be taken on board and communicated to the right quarters, I am sure a service would be done, not just to the nation but to the world.

[Baroness Neville-Rolfe (Con)]

I thank my noble friend for his message. I know that His Majesty is also looking to arrange a global event in advance of COP to talk to some of the key people involved. However, as I said, I cannot comment on communication and advice between him and the Prime Minister or the Government—that remains confidential.

[Baroness Sheehan (LD)]

My Lords, the ban on King Charles attending the conference imposed by the previous incumbent of No. 10 is, quite frankly, churlish and rather unseemly. The US climate envoy, John Kerry, Alok Sharma himself—the outgoing COP 26 president—and even the Daily Telegraph believe he should go. The Egyptian Government have renewed their invitation to the King. Will the Minister urge the Prime Minister to lift the ban?

[Baroness Neville-Rolfe (Con)]

Noble Lords will know that this is a matter for His Majesty.

[Baroness Boycott (CB)]

My Lords, I add my voice to agreeing that the King should be going, but to build on what the noble Lord, Lord Dubs, said, yesterday, António Guterres said that this was the catastrophe and that all other catastrophes we are living through will only get worse. Why have the Government downgraded Alok Sharma’s post from the Cabinet, and can the Minister assure the House that a new Cabinet post will be created specifically to look at the climate crisis?

[Baroness Neville-Rolfe (Con)]

It is the case that Alok Sharma is no longer a Minister nor in the Cabinet. However, the Prime Minister has appointed him as COP president, and that provides continuity and retains his expertise in this important role. I have been struck by his tireless work over the past year, and he is always particularly focused on implementation and the international perspective, as well as other issues. The thing is to get COP 27 done in a brilliant way in Sharm el-Sheikh from 6 to 18 November 2022. I cannot comment on appointments by the Prime Minister.

[Baroness Jones of Whitchurch (Lab)]

My Lords, should we not get our own house in order to earn the respect of all the other countries that will be at COP 27? Just as an example, we already have a commitment to have 30% of land for nature by 2030. So far, the statistics are that we have only 3%, so we have a long way to go before we can hold our heads up at COP 27 and earn the respect globally that we deserve.

[Baroness Neville-Rolfe (Con)]

I understand from my noble friend that we lead the campaign for 30/30.

[Baroness Verma (Con)]

My Lords, I welcome my noble friend’s response to the question of the noble Baroness, Lady Boycott, but I encourage her to have discussions between our Ministers and other Ministers at COP 27 on getting businesses to help the less developed countries be able to respond better by investing in them, and countries helping to support that through business. Will my noble friend comment on that?

[Baroness Neville-Rolfe (Con)]

I am very glad my noble friend raised that, because the Glasgow climate pact emphasised the importance of collaboration across sectors in all parts of society to deliver on climate change, and business plays an important part. I remember from my experience of net-zero plans when I was in business, many years ago. Business can contribute in some of the poorest countries in the world by helping the transition, reducing carbon and being more efficient. There is a real win-win there, and what has been encouraging both at Glasgow and in the prospective agendas for Sharm el-Sheikh is how businesses are stepping up to the plate in this important area.

[Baroness Ludford (LD)]

My Lords, a few answers ago the Minister said that the attendance of the King at COP 27 was a matter for the King. Was that an answer to my noble friend Lady Sheehan, who asked whether the new Government have lifted the ban on King Charles III attending the conference in Egypt? A quick yes or no would suffice.

[Baroness Neville-Rolfe (Con)]

There is no ban. This is a matter for the palace, and I really cannot be drawn on communication between the Government and the monarch. This is a matter for them, but I reiterate that we are very fortunate that our King is so globally identified with nature and tackling climate change.

[Lord Deben (Con)]

Can my noble friend help me? Can we now expect that the Cabinet committee chaired by the Prime Minister will continue, that the Prime Minister will chair it and that it will be regular in dealing with climate change, which, after all, is the biggest material threat to ourselves and the world that exists?

[Baroness Neville-Rolfe (Con)]

I know all that my noble friend has done to help on climate change and his great work chairing the Climate Change Committee. As for the Cabinet committees for the new Government, we will have to wait to find our exactly what they look like.

[Baroness Smith of Basildon (Lab)]

My Lords, I bring the Minister back to her answer to my noble friend, who asked about the 30/30 campaign. The Minister said that we lead the campaign on this; it is all very well leading campaigns, but after 12 years in government, we have not had actually made much progress. We are talking about 3% of land rather than 30%. With COP 27 pending, could she not say a little more about the implementation? Having led the campaign with such vigour—but obviously not great response—when will we get to the 30% required by the campaign?

[Baroness Neville-Rolfe (Con)]

On the 30%, there is obviously lots to do. I believe that 100 countries have now signed up. We have been very good at leading other countries and trying to get them involved in these matters. Obviously, it is work in progress. The UK is recognised as a global leader on many aspects of climate change. Our emissions reduced by 47% since 1990, and we have a stretching NDC, but, perhaps most of all, we are the first nation to legislate for net zero by 2050.

[Lord Hamilton of Epsom (Con)]

Does my noble friend accept that COP 27 is unlikely to be a success as long as India and China go on building coal-fired power stations and increasing the amount of CO₂ in the atmosphere, whatever we do in this country?

--- Later in debate ---

[Baroness Neville-Rolfe (Con)]

My noble friend is right that carbon and weather do not respect borders, so it is very important that all countries across the world look at these things. I remember doing work with the Indians on climate change in my business days and, in some areas, they do a lot of very good things, but the energy transition is one of the challenges that all countries face and is something that can be discussed constructively at COP 27.

Home Secretary: Resignation and Reappointment

Baroness Neville-Rolfe Excerpts

Thursday 27th October 2022 Lords Chamber

[Baroness Smith of Basildon (Lab)]

My Lords, the response in the other place that the sacking or resignation of the Home Secretary in last week’s Government was for “an error of judgment”, and that she recognised her mistake and stood down, is now under scrutiny and it is starting to wilt like a lettuce. A range of sanctions is available for the breach of the Ministerial Code, yet for this particular breach, which the Government now want to play down, apparently resignation was the only option, not the other sanctions available.

Last night, Sir Jake Berry, who was the Chairman of the Conservative Party until Tuesday, said that there had been “multiple breaches” of the Ministerial Code. Numerous questions are now becoming more evident—it is quite a murky business—but two are really important for Parliament. First, did the Home Secretary immediately refer herself for this security breach, or did it come to light only after being reported by somebody else? Secondly—I was surprised this question was not answered by the Prime Minister in the House of Commons yesterday, when Keir Starmer asked it, so I will ask it again—have officials raised any concerns about Rishi Sunak’s decision to reappoint Suella Braverman as Home Secretary?

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

My Lords, I think it is actually very simple. Noble Lords have seen Ms Braverman’s letter. She made a mistake when she was Home Secretary. She acknowledged the mistake; she acknowledged an error of judgment; she apologised. That was dealt with by the previous Prime Minister and Ms Braverman resigned. Separately, the present Prime Minister has decided to appoint Ms Braverman as Home Secretary.

Everyone deserves a second chance. The Prime Minister was clear that this is a Government with integrity, professionalism and accountability, and I believe it was right to bring her back. On the question of advice, noble Lords will know that we do not comment on internal advice; such advice is confidential.

[Lord Paddick (LD)]

My Lords, apparently the Member of Parliament for Fareham, when previously Home Secretary, sent a restricted document to her own personal email address and then forwarded it to a Back-Bench MP and to someone she wrongly thought was the MP’s wife, apparently to get their advice. It was the second recipient of her email who alerted the authorities, not the MP for Fareham. If she is so unsure of her own judgment, and given that she goes to such lengths to circumvent security measures, why is she now Home Secretary?

[Baroness Neville-Rolfe (Con)]

My Lords, I can only say again that mistakes were made and that the Home Secretary acknowledged those. It is a good thing to acknowledge when mistakes have been made. She apologised, sanctions were applied under the last Administration and the new Government have put together a united team to deliver for the British people, and that includes Ms Braverman. She needs to be able to focus on illegal immigration, on control of borders and on making our streets safer. She needs to deal with the murderous channel crossings criminal racket, and I hope the party opposite will support that.

[Baroness Jones of Moulsecoomb (GP)]

My Lords, if the Government are so keen on second chances, if I threw a can of soup at a painting, would the police be prepared to give me a second chance and not imprison me or penalise me in any way?

[Baroness Neville-Rolfe (Con)]

It goes beyond the scope of the Question today, but we do have rehabilitation of offenders and we have a court system. As was said in the other place, there is an opportunity for redemption, and we must look forwards, not backwards.

[Baroness Manzoor (Con)]

My Lords, can my noble friend the Minister say, having been issued with the Ministerial Code, what training is given to all new Ministers, not only in the other place but in this place?

[Baroness Neville-Rolfe (Con)]

I am not sure how much I can say, but as a new Minister, I can confirm that extensive security training is given to new Ministers. On taking up office, I was impressed at the security training. Noble Lords will note that there is a confidential annexe to the ministerial code which deals with security issues. This is a very important matter, which we all take very seriously. People can make mistakes—I remember this from being outside government—but there are remedies and they have been served.

[Lord Blunkett (Lab)]

My Lords, I know that the Minister, of all people, will understand the sensitivity of what I am putting to her, but I do so nevertheless. Is it not true that there could be two really unfortunate outcomes to the reappointment of the current Home Secretary? One is the reluctance of the security and intelligence services to provide the briefings and the openness needed, and the second is the reluctance of other international security agencies to share information with us if they are fearful that it will be passed out from government?

[Baroness Neville-Rolfe (Con)]

As the noble Lord knows, Ministers receive the security briefing that they need to do their job in an appropriate manner. The Government focus a great deal of effort on this. There is not a great deal to add.

[Lord Beith (LD)]

My Lords, when the previous Prime Minister accepted—perhaps invited—the resignation of the person who is now Home Secretary, did she or the Cabinet Secretary envisage that a period as short as a week would be sufficient expiation for what had been done wrong, or is that judgment now irrelevant?

[Baroness Neville-Rolfe (Con)]

Things have moved a little bit faster in recent weeks than perhaps some of us would have foreseen, even the currency markets. These circumstances are very unusual, and it is very important that people are not excluded for ever from opportunities. The Prime Minister felt, in his wisdom, that he needed to bring together a Cabinet with different talents and experience. She brings experience and talents to the job and, as I have said, she apologised and acknowledged her mistake, and that was dealt with by the previous Prime Minister. You have to allow us to look forward.

[Baroness Chakrabarti (Lab)]

My Lords, as a self-identifying tofu-eating person who believes in the rehabilitation of offenders, I am glad to hear that from the Minister and I look forward to hearing it from Ms Braverman in relation to other people. To apply the rehabilitation of offenders, we must look forensically at the nature of the offending and the mitigation. Can the Minister please readdress the question asked by my noble friend about how this offending was detected? Was it detected because the former and current Home Secretary owned up, or because somebody else reported her? What does the Minister say about Mr Berry’s suggestions that there were “multiple breaches”, not a single breach, of the Ministerial Code?

[Baroness Neville-Rolfe (Con)]

I cannot comment further on the detail. I do not know exactly what happened, in any event, but what I am clear about is that Ms Braverman wrote a letter to the Prime Minister setting out why she was resigning, and she resigned in good order and quickly. She deserves another chance. Mistakes were made—I will not go into those mistakes—but the Government have moved on, they have reappointed the Home Secretary and she must now be allowed to get on with her job. We seem to be going round and round in circles. I slightly feel like Boycott today, rather than Bairstow, but we need to give her a chance.

[The Lord Bishop of Durham]

My Lords, I do not come at this from any party-political angle. The question in my mind is this. Even if all the justifications are correct—and there are big questions about that—was it wise, in seeking to offer integrity and leadership, to appoint someone so rapidly who had raised so many questions about whether she was suitable to hold the office?

[Baroness Neville-Rolfe (Con)]

Ms Braverman apologised. She resigned from a great office of state. She accepted the remedies of the Ministerial Code. Things then moved on at great speed. We have different circumstances. We have a Government who need to deliver for the British people in difficult economic circumstances. She needs to be able to play her part in making our borders safer and better, and she needs the support of this House.

Procurement Bill [HL]

Baroness Neville-Rolfe Excerpts

Committee stage
Wednesday 26th October 2022 Grand Committee

[Baroness Hayman of Ullock (Lab)]

My Lords, this has been an interesting debate that I hope has been helpful to the Minister. I have three amendments in this group. Amendment 273 requires that one KPI is compliant with the carbon-reduction plan. Tied into that is Amendment 274, which requires that, where public contracts in scope of the KPIs fall below the threshold for mandatory carbon-reduction plans, at least one KPI should assess the supplier’s performance against climate or environmental considerations.

As I said on Monday, the transparency requirements are very welcome. We believe they could provide the opportunity for contracting authorities and their suppliers to demonstrate that they are having regard to climate change and are managing the risks through regular environmental reporting as a KPI. However, those requirements are not set out in the Bill but will be left to secondary legislation. For example, they do not impose requirements in relation to the environmental commitments made by the supplier awarded the contract or for the regular reporting on whether the commitments have actually been met. We feel that that needs to be strengthened, which is why we have tabled the two amendments on this area.

My Amendment 353AA would create the process to ensure that contracting authorities safeguard the public interest. I thank the noble Lord, Lord Fox, for his support. The noble Lord, Lord Scriven, gave a detailed explanation of the importance of this, so there is no need for me to go into any further detail. Looking at the public interest and the wider potential impacts of any contracts that are supplied is something that we need to be extremely aware of and cautious about.

I turn to other amendments in this group. The noble Lord, Lord Lansley, made some important points here; we are very sympathetic to them and I would be interested to hear the Minister’s thoughts. These seem to be straightforward areas where the Bill could be improved. In particular, the noble Lord explained how the time modifications, going from one-10th to one-sixth, made sense and would make life a lot easier for people. Again, these are sensible amendments so it would be interesting to hear the Minister’s response.

My noble friend Lady Thornton has tabled some amendments around KPIs and social value, and we strongly support both of them. I am sure the Committee is aware that social value is included in the national procurement policy statement, but there is no reference to social value in the Bill itself, as has been said on a number of occasions when we have debated this in Committee. We have been told by officials—and by previous Ministers before the noble Baroness—that social value is integrated into the concept of public benefit, but we believe that “public benefit” is just too vague a concept and it is just not clear where social value sits within this framework. My noble friend raises an important point with her amendments, and I hope the Government will start to take this issue more seriously.

As usual, the noble Baroness, Lady Noakes, put her finger on an area that needs proper clarification. I am sure the Minister will have listened very carefully to everything she said.

The noble Lord, Lord Scriven, introduced some of the Liberal Democrat amendments by talking about the importance of sustainable local improvements and, again, the wider public benefit: what is this, what does it mean and what will we get out of it in the Bill? Again, a lot of what he was saying—and what the amendments from the Liberal Democrats are doing—is very similar to, and ties in with, the amendments we have put down: they look at the environmental and social value impacts and how we can build these into the Bill to make important improvements.

The noble Baroness, Lady McIntosh of Pickering, made some important and specific points with her amendments, and I was happy to add my name to them. They draw attention to a really important issue, which has been missed out and is extremely pertinent at the moment when we consider current concerns over inflation—particularly food price inflation, as she mentioned—and the rise in prices more generally. Public sector catering businesses were really badly hit during the pandemic and are still struggling, so we need to pay proper attention to her amendments. If we are genuine about supporting SMEs, this is an area where they really need some strong support from the Government at the moment.

I commend my noble friend Lord Mendelsohn for his work on tackling the issue of late payment. His dogged approach to this has achieved much, but there is still much more to achieve. His amendments are very important and helpful; again, they are about helping SMEs, something the Minister has said time and again she wants to do.

As the noble Lord, Lord Fox, asked, why is there nothing on late payments, or the issues he raised in particular, in the Bill? This is a real opportunity to do that. The noble Lord, Lord Aberdare, raised similar issues around small and medium-sized businesses and the kind of support they need for procurement if they are to be able to make the most of the contracts that are out there for them. I totally agree with him on the issues around SMEs and the construction sector: it can be very difficult for SMEs to break into that sector, and very difficult for them to manage their cash flows if they start having issues around late payment, which unfortunately happens all too often. In addition, we would strongly support his request for picking up the meeting idea to see whether we can make some progress on this matter between Committee and Report.

To summarise, the Bill needs to ensure that it specifies that KPIs are flexible, proportionate, realistic, agreed properly with the provider and informed by engagement with the people accessing any services. These are helpful amendments, seeking to achieve many of these aims. I hope that the Minister is sympathetic to much that has been proposed and I look forward to her response.

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

My Lords, I am glad to be debating this group, which deals with prompt payment of suppliers throughout the supply chain, an important innovation in the Bill to deal with a long-standing problem. I am slightly perplexed by the words of the noble Lord, Lord Fox, because one of the advantages of the Bill is that we are making progress on prompt payment and adding rules in relation to the indirect suppliers, which is a considerable breakthrough.

There are a number of government amendments. Amendments 354 and 434 confirm the start of the period during which payment must be made following receipt of an invoice. Amendment 361 signposts the reader to an electronic invoicing provision in Clause 63. Amendments 360, 362, 363, 431 and 432 align wording with equivalent provisions elsewhere. Amendment 433 corrects the territorial application of this regulation-making power in Clause 80.

I now turn to government amendments to Clauses 69 and 70 and Schedule 8 on contract modification. Amendments 365 to 371 to Clause 69, “Modifying a public contract”, have been made to correct technical errors and make the clause clearer. Many of the amendments to Clause 70—I reference Amendments 390, 391 and 392A—arise as a consequence of the decision to divide this clause to make it simpler for contracting authorities to understand their publishing obligations.

Amendment 372 has been made to ensure that contract change notices are published when a contract is transferred to a new third party under paragraph 9 of Schedule 8. Amendments 373 and 374 clarify the anti-avoidance provisions. Amendment 375 creates a new paragraph (b), which reduces the burden of publication. Amendment 376 sets out certain contracts that are exempt from the obligation to publish contract change notices. Amendments 377, 381 and 385 are consequential. Amendments 378, 380 and 383 have been made to ensure that the clause will work effectively for Wales and Northern Ireland. Amendment 384 and 389 provide that certain other contracts are exempt from the requirement to publish details of a qualifying modification.

--- Later in debate ---

[Baroness Neville-Rolfe (Con)]

Amendment 392 makes it clear that the power to change the percentage thresholds in Clause 70 applies to Welsh Ministers as well as a Minister of the Crown.

I apologise in advance for the length of my reply to the substantive points in this important group. I turn first to key performance indicators in Clause 50. My noble friend Lord Lansley’s first amendment would require contracting authorities to set at least three KPIs that are “quantifiable measures” as well as

“such further factors and measures as the contracting authority considers justified in relation to the requirements and value of the contract”.

The very nature of a KPI means that it has to be quantifiable; otherwise, performance cannot be effectively measured. In addition, the Bill already requires contracting authorities to set “at least three” KPIs, but they can set more where they consider it justified. His second amendment relates to where the KPIs are derived from. It proposes that they be tied to the specifications of the tender rather than to the contract itself. Forcing KPIs to be tied to the specifications of the tender means performance is not measured effectively. They need to relate to the final agreement, not to a previous document that may have been changed during the competitive tendering procedure. However, I can assure my noble friend that further regulation and guidance will describe the best way to set and monitor KPIs.

Amendment 269A, tabled by the noble Baroness, Lady Thornton, Amendment 272, tabled by the noble Lords, Lord Wallace and Lord Scriven, and Amendments 273 and 274, tabled by the noble Baronesses, Lady Hayman and Lady Bennett, and the noble Lord, Lord Coaker, would require KPIs to relate to wider policy matters, such as social value, carbon reduction and, as I think the noble Lord, Lord Scriven, mentioned in his intervention, sustainable local improvement. As stated a number of times in Committee already, and for good reason, procurement policy is not fixed and evolves as new strategic priorities emerge, such as our action to address climate change in procurement in recent years. Policy matters such as these should therefore not be included in the Bill and are better addressed in the national procurement policy statement.

Amendment 271, proposed by my noble friend Lady Noakes, suggests that Clause 50(2) should be removed. This provision confers a discretion on the contracting authority not to publish KPIs if the contract in question could not be appropriately assessed by reference to KPIs. Subsection (2) serves a vital purpose. It is not appropriate to measure all contracts by reference to KPIs—for example, a goods contract for an order of IT hardware or office furniture. We therefore need to confer a discretion on contracting authorities, rather than create a legal obligation that cannot be met in every case and which, in some instances, would add legal and administrative burdens with limited additional benefit that would be hard to justify. Moreover, the discretion in subsection (2) not to publish KPIs can be exercised only when appropriate. The transparency obligation in Clause 51 should, I believe, help to prevent any abuse of the provision. In addition, the Freedom of Information Act, which was mentioned in the discussion, allows stakeholders to exercise scrutiny over the form of KPIs that contracting authorities write into their contracts. It is not in their interest to avoid these requirements as the information will become public in any event.

I thank the noble Lord, Lord Fox, for his Amendments 275A and 276ZA and his thinking on KPIs, although I must confess to having a sense of déjà vu. The balance of benefit against burden is an important matter that we must look at in this Bill, and one that merits investigation by us all. I am therefore grateful for the opportunity to set out our position on this.

The power in Clause 50(4) allows amendment of the £2 million threshold in subsection (1) above which KPIs must be set and reported on. The two proposed amendments probe that power in different ways. The first amendment seeks to remove the ability to amend the threshold in its entirety and the second limits the power to reducing the threshold.

--- Later in debate ---

[Lord Scriven (LD)]

I am confused by that answer; I do not understand, in practice, what the Minister has just said. There could be at least two public bodies involved in an individual’s care, through social care and the NHS. Can the Minister clarify a little better how the public interest is served when one public body decides to outsource, having an impact on another public body which has no control or say over the contract that has been let, when the client the contract could serve impacts on both bodies?

[Baroness Neville-Rolfe (Con)]

I was trying to make sure that the noble Lord knew that I had listened to his point. There is a point about what is covered by the Bill and what is not, so perhaps I will reflect a little further on how we achieve the best outcome in the sort of circumstances he describes.

Moving on, I thank the noble Lord, Lord Mendelsohn, for his kind words. I look back with great pleasure on the work we did together on those Bills. I very much agree with the noble Baroness, Lady Hayman of Ullock, that he has made a huge contribution in this area. To some extent, his dogged determination has been rewarded with this Bill, which, I think, as I said right at the beginning, makes something of a breakthrough. That is why I am glad now to be the Minister and to make sure that that breakthrough is reflected in a larger share of procurement for SMEs, with payment being more consistently speedy. It is clear that, in a lot of areas, payment is quite good.

The noble Lords, Lord Aberdare and Lord Mendelsohn, have tabled Amendments 353B, 370A and 430A. They would create a process for resolving payment disputes that would mandate escalation to the Small Business Commissioner, who we remember so well, for arbitration and resolution. Going back, I think that the noble Lord, Lord Mendelsohn, wanted me to be the commissioner, but it never happened. The amendments would also require the automatic payment of late payment interest in the event of a contracting authority being found to be in violation of the payment provisions of this Bill.

I believe that this Bill represents a big step forward in tackling late payment, as I have said. However, I believe that these amendments could introduce unwelcome complexity into the system for government suppliers and remove the parties’ ability to be flexible in matters of dispute resolution by tailoring dispute resolution and escalation procedures to particular contracts. There are now—this is an important point—a range of existing mechanisms in place to deal with late payment. Suppliers, including those in public sector supply chains, can raise payment delays with the Public Procurement Review Service, which the noble Lord, Lord Aberdare, kindly drew to our attention and which will work to unblock any overdue payments. It is a well-established service. It has been successful in releasing more than £9 million of late payments to date and has grown in confidence since we passed the Small Business, Enterprise and Employment Act 2015. I assure noble Lords that the PPRS will continue to carry out this function under the new regime to unlock contract-specific instances of late payment.

[Lord Mendelsohn (Lab)]

I have just two things to say very briefly. First, I did say that I thought the noble Baroness would be a brilliant Small Business Commissioner, but I think that she is a brilliant Minister.

I did not put the Public Procurement Review Service in my speech because I have issues with it. It has unlocked £9.4 million. When I first read its work in 2020, it said £8 million. I thought that meant £8 million in that year, but £9.4 million is the entire sum that it has unlocked since it was set up in the Small Business, Enterprise and Employment Act 2015. Last year, its achievement was £1.4 million. It has dealt with 400 cases and has, it says, been 100% successful. However, it is also reported elsewhere that it has dealt with more than 1,900 cases, most of which involved suppliers that gave up on it during the course of its process. Let me retell the numbers: 23,000 invoices in one local authority alone. The Minister can tell me that 400 cases over an eight-year performance is good, but I am not so sure. I appreciate that there is a vehicle—again, I am not picky about which one it is—but one cannot say that that performance is making any meaningful impact. That is why I would be grateful if the Minister could look at that in more detail.

[Baroness Neville-Rolfe (Con)]

I will certainly look at the figures, which I am very interested in, but this Bill obviously represents something of a step change. The key thing is how we can make it work effectively. I also highlight that suppliers already have the ability to claim interest on late payment under the Late Payment of Commercial Debts (Interest) Act 1998, which has been referenced. A reference to it in our Bill therefore seems unnecessary.

The proposed amendment would also significantly alter the remit of the Small Business Commissioner. Under current legislation, a small business may complain only about a large business. As such, it would not be appropriate to reference the Small Business Commissioner in this context; it is a slightly different type of system.

The noble Lord, Lord Mendelsohn, has also tabled Amendment 356A, which would place a duty on contracting authorities to report payment performance under regulations made under Section 3 of the Small Business, Enterprise and Employment Act 2015. These regulations currently place a duty on the UK’s largest companies to report on a half-yearly basis on their payment practices, policies and performance. We are thinking about what we can do to open up more contractual opportunities to SMEs and will come back to that on Report. We recognise the need for alignment with the private sector so that we can have a bit more comparison of performance.

However, we do not, for example, want to constrain the Government in the future from pursuing the reporting of higher payment standards for the public sector should we wish to do that, nor can we add new requirements to the private sector without some form of consultation, especially at this difficult time. I am happy to look at the possibilities on publishing payment performance information for private companies alongside those in the public sector and at trying to make the results more easily comparable. It may take a little time, but I hope that noble Lords will find that assurance helpful. We will see what we can do.

Turning to Amendment 361A, tabled by the noble Lord, Lord Aberdare, this amendment would enable contracting authorities to pay subcontractors in their supply chain directly where a prime contractor does not pay within agreed terms. The contracting authority would then be able to reclaim the outstanding amounts from the prime contractor, either by discounting the sum owed or by reclaiming the money as a debt. This amendment would, of course, utilise public money as a method of resolving such disputes. Where insufficient money remained, this would introduce risk and liquidity pressure to public sector accounts, with financial implications that are extremely difficult to countenance, especially in current circumstances.

The noble Lord, Lord Aberdare, asked whether we could introduce the “step-in” right, as suggested by Amendment 361A, as a right rather than an obligation. This could lead to confusion for contracting authorities about when they should step in. It would also expose them to unnecessary challenge when they decided not to step in. However, suppliers in public sector supply chains can, as we have noted, use the Public Procurement Review Service to help unlock late payments where existing contractual routes fail. Further, there are some other mechanisms available, for example, project bank accounts, which may work in some cases and allow protected sums to be distributed to those in the supply chain.

Turning to contract modifications, my noble friend Lord Lansley has tabled Amendment 364 to substitute a 10% term threshold with a threshold of one-sixth of the contract term. Noble Lords will wish to note that the Bill does not say that contracting authorities cannot extend a contract’s duration by more than 10%. They can do so, but they must use other grounds within the contract modification rules. They are set out in Clause 69 and Schedule 8. These other grounds, in the majority of cases, will oblige them to publish a contract change notice, which will set out why they are making that modification.

We do not think that contracting authorities should be given greater leeway by increasing the 10% to one-sixth. Under the current regime, we have seen contracting authorities extend contracts by substantial periods time and time again without the public or the market being aware of the situation and therefore able to challenge it. We hope Clause 69(3)(a) will change that behaviour.

Amendment 370ZA, tabled by my noble friend Lady McIntosh, the noble Baroness, Lady Hayman, and the noble Lord, Lord Coaker, proposes that we insert a provision in the Bill that contract reviews should be held by both parties every three months. The Procurement Bill covers a huge variety of contracts—that is one of the challenges—and suppliers and contracting authorities are in frequent contact. A legal obligation that contract reviews must be held every three months is overly prescriptive. Contracts are kept under review by contracting authorities and suppliers as appropriate. One size does not fit all.

I see from Amendment 370B that the proposition that contract reviews should be held every three months has arisen from current concerns over inflation. Prices may be index-linked, and contracts may contain review clauses related to inflation. In those circumstances, modifications under the ground of Schedule 8(1) are already permitted.

My noble friend Lady McIntosh raised an important point relating to the context of rising food prices, caused, ultimately, by the situation in Ukraine. Complex public contracts, including large outsourcing contracts which cover food provision for public bodies, generally do account for inflation. Obviously, coming from a farming and retail background, I understand some of the issues that my noble friend described. I particularly agree about the importance of SMEs, as we all say again and again, and trying to get them a bigger share of procurement. However, her approach is too prescriptive and could lead to yet more inflation, and would put costs on the public sector at a particularly difficult time.

--- Later in debate ---

[Baroness Noakes (Con)]

I feel obliged to pursue this issue just a little further. When I spoke to the amendment, I referenced the imbalance of power between contracting authorities and small and medium-sized enterprises, which was its focus. I understand the points that my noble friend is making about when there are parties on either side of the transaction with equal bargaining power, but it does not work like that when there is unequal bargaining power. I am not suggesting that Amendment 486 is a perfect answer to that, but I do not think my noble friend has addressed the point as it applies to SMEs. I know that is a theme that has run throughout our consideration of the Bill, but I want to record that I do not regard her response to my amendment as really getting to the heart of the problem.

[Baroness Neville-Rolfe (Con)]

I thank my noble friend for her intervention. I agree that we need to try to get at the issue of the balance of power; indeed, we were discussing it at my briefing meeting. I think it may be worth having a further discussion with the Government Office for Technology Transfer, because it needs to understand the importance of these small companies to innovation and how the kinds of decisions that they make on rights and intellectual property can make an important difference. I am grateful to her for raising that further point.

[Baroness McIntosh of Pickering (Con)]

I listened very carefully to what the Minister said to our noble friend and to her response to my two little amendments. I am struggling to understand how she believes that Amendments 370ZA and 370B would transfer cost to the public sector. I know from her time on the Back Benches how much my noble friend likes impact assessments, so I refer to page 44 of the impact assessment, which states strongly that this is to encourage SMEs. I hoped that I had made the case—as did a number of others, including my noble friend Lady Noakes—for how SMEs should be benefiting from this, but, in two specific areas that I set out, SMEs are actually being handicapped by the current provisions under the Bill.

[Baroness Neville-Rolfe (Con)]

I will certainly look carefully at Hansard. I think my noble friend was basically talking about an inflation adjustment.

[Baroness McIntosh of Pickering (Con)]

Five per cent, plus the three-month review.

[Baroness Neville-Rolfe (Con)]

And a three-month review. The point about inflation is that if you build it in—this is a wider economic point—and then it goes up further, you can get an inflationary spiral. We have to try to find a way for people to come together and think about how we can best handle that, and I think the current system does that well. That is certainly my own experience, having been involved in procurement on both sides of the divide.

You can write in three-monthly reviews, but the difficulty is that this is an all-embracing Act and putting that into the Bill could lead to a lot of extra meetings and reviews that might not fit in with simplicity. But obviously this is Committee and we will be reflecting further on the right thing to do. I thank my noble friend for, as always, pursuing her point with such clarity and doggedness.

Finally, this is not in my script but I would like to confirm that I and the team are looking back at the undertakings made on earlier days in Committee to make sure that balls are not dropped. I confirm that we will be arranging meetings on the SME angle, even though I am not able to champion them. I have already had a round table with SMEs and the official team to see what can be done. I do not want to overpromise, but we want to do our best. I respectfully request that the various non-government amendments be respectively withdrawn or not moved.

[Lord Lansley (Con)]

Thank you. That was a long group so the reply was necessarily substantial, and we are most grateful for that. I was happy to have the confirmation that KPIs must be quantifiable. I am still slightly uncertain whether 10% works very easily—maybe it would have been easier to express it as one month in a year or something like that to deal with time—but still I am grateful.

If the question of force majeure is taken up through the general terms and conditions, I just ask that it requires the system, as it were, to say that we have standard terms and conditions and, as a result of some of the debates on the Bill, we also need to look at our general terms and conditions, and how things are to be expressed in future. As far as Amendment 268 is concerned, I was grateful for the Minister’s response and I beg leave to withdraw the amendment.

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Moved by

[Baroness Neville-Rolfe]

277: Clause 51, page 31, line 24, leave out “awarded under this Part”

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Moved by

[Baroness Neville-Rolfe]

288: Clause 52, page 33, line 6, at end insert—

“The contract being awarded is being awarded by reference to suppliers’ membership of a dynamic market

10 days”

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Moved by

[Baroness Neville-Rolfe]

291: Clause 54, page 34, line 2, leave out “supplier” and insert “person”

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Moved by

[Baroness Neville-Rolfe]

294: Clause 54, page 34, line 5, leave out second “supplier” and insert “person”

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Moved by

[Baroness Neville-Rolfe]

296: Clause 54, page 34, line 10, leave out “supplier” and insert “person”

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Moved by

[Baroness Neville-Rolfe]

299: Clause 54, page 34, line 13, leave out second “supplier” and insert “person”

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Moved by

[Baroness Neville-Rolfe]

302: Clause 54, page 34, line 19, leave out first “section” and insert “Act”

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Moved by

[Baroness Neville-Rolfe]

303: Schedule 6, page 91, line 14, at end insert “, other than an offence under section 54 of that Act”

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Moved by

[Baroness Neville-Rolfe]

309: Schedule 6, page 93, line 1, leave out paragraphs 2 and 29 and insert—
“28(1) An offence under the law of any part of the United Kingdom consisting of being knowingly concerned in, or in taking steps with a view to, the fraudulent evasion of a tax.(2) In this paragraph,“tax” means a tax imposed under the law of any part of the United Kingdom, including national insurance contributions under—(a) Part 1 of the Social Security Contributions and Benefits Act 1992, or(b) Part 1 of the Social Security Contributions and Benefits (Northern Ireland) Act 1992.”

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Moved by

[Baroness Neville-Rolfe]

311: Schedule 6, page 94, line 15, leave out “a tax arrangement that is abusive” and insert “tax arrangements that are abusive (within the meaning given in section 207 of the Finance Act 2013)”

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Moved by

[Baroness Neville-Rolfe]

316: Schedule 6, page 95, line 1, leave out paragraph (b)

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Moved by

[Baroness Neville-Rolfe]

324: Schedule 7, page 99, line 38, leave out “the supplier or connected person is”

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Moved by

[Baroness Neville-Rolfe]

334: Clause 55, page 34, line 27, leave out second “supplier” and insert “person”

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Moved by

[Baroness Neville-Rolfe]

336: Clause 55, page 34, line 30, leave out second “supplier” and insert “person”

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Moved by

[Baroness Neville-Rolfe]

339: Clause 55, page 35, line 5, leave out paragraph (b)

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Moved by

[Baroness Neville-Rolfe]

341: Clause 56, page 35, line 15, leave out “procurement” and insert “competitive tendering”

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Moved by

[Baroness Neville-Rolfe]

352: Clause 59, page 38, line 34, leave out “a Northern Ireland department” and insert “the Northern Ireland department that the Minister considers most appropriate”

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Moved by

[Baroness Neville-Rolfe]

354: Clause 63, page 41, line 13, at end insert—
“(b) a reference to a contracting authority receiving an invoice includes a reference to an invoice being delivered to an address specified in the contract for the purpose.”

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Moved by

[Baroness Neville-Rolfe]

355: Clause 64, page 41, line 30, leave out “An appropriate authority” and insert “A Minister of the Crown or the Welsh Ministers”

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Moved by

[Baroness Neville-Rolfe]

357: Clause 65, page 42, line 1, leave out “An appropriate authority” and insert “A Minister of the Crown or the Welsh Ministers”

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Moved by

[Baroness Neville-Rolfe]

360: Clause 66, page 42, line 32, leave out “remedy the breach or”

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Moved by

[Baroness Neville-Rolfe]

361: Clause 68, page 43, line 37, leave out “subsection (8)(a) of section 63” and insert “section 63(8)(a) (electronic invoices)”

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Moved by

[Baroness Neville-Rolfe]

362: Clause 68, page 44, line 2, leave out “the whole” and insert “all”

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Moved by

[Baroness Neville-Rolfe]

365: Clause 69, page 44, line 25, leave out from beginning to “materially”

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Moved by

[Baroness Neville-Rolfe]

371: Schedule 8, page 104, line 36, after “assignment” insert “(or in Scotland, assignation)”

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Moved by

[Baroness Neville-Rolfe]

372: Clause 70, page 45, line 19, at end insert—
“unless the modification is a permitted modification under paragraph 9 of Schedule 8 (novation or assignment on corporate restructuring).”

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Moved by

[Baroness Neville-Rolfe]

380: Clause 70, page 45, line 37, leave out “or a transferred Northern Ireland procurement arrangement”

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Moved by

[Baroness Neville-Rolfe]

383: Clause 70, page 45, line 39, at end insert “or a transferred Northern Ireland procurement arrangement”

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Moved by

[Baroness Neville-Rolfe]

389: Clause 70, page 46, line 3, leave out subsection (10)

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Moved by

[Baroness Neville-Rolfe]

392A: After Clause 70, divide Clause 70 into two clauses, the first (Contract change notices) to consist of subsections (1) to (5) and (9) and (12) and the second (Publication of modifications) to consist of subsections (6) to (8) and (11)

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Moved by

[Baroness Neville-Rolfe]

393: Clause 71, page 46, line 12, after “period” insert “(“a voluntary standstill period”)”

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Moved by

[Baroness Neville-Rolfe]

395: Clause 72, page 46, line 24, leave out “supplier” and insert “person”

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Moved by

[Baroness Neville-Rolfe]

398: Clause 72, page 46, line 30, leave out “ 28(1)” and insert “ 28(A1)(a)”

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Moved by

[Baroness Neville-Rolfe]

401: Clause 72, page 47, line 22, leave out “8” and insert “9”

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Moved by

[Baroness Neville-Rolfe]

402: After Clause 72, insert the following new Clause—
“Terminating public contracts: national security
A contracting authority may not terminate a contract by reference to the implied term in section 72 on the basis of the discretionary exclusion ground in paragraph 15 of Schedule 7 (threat to national security) unless—(a) the authority has notified a Minister of the Crown of its intention, and(b) the Minister considers that—(i) the supplier or sub-contractor is an excludable supplier by reference to paragraph 15 of Schedule 7 , and(ii) the contract should be terminated.”

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Moved by

[Baroness Neville-Rolfe]

403: Clause 73, page 47, line 37, at end insert “, or
(b) in relation to a contract awarded under section 40 by reference to paragraph 16 of Schedule 5 (direct award: user choice contracts).”

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Part 5 is one of the most important parts of the Bill. If we can improve it and get it right, it will start to address the very real lack of public confidence in how public procurement operates at every level. Again, far too many people think that there is one rule for those who are in the system and one rule for people who are not. We have an opportunity to do something about it. With that, I hope the Minister will address some of these amendments and the points that have been made.

[Baroness Neville-Rolfe (Con)]

My Lords, we come to Part 5 of the Bill on conflicts of interest, where the Government have sought to give greater clarity on these obligations, partly in the light of the difficult experience during Covid-19.

On the one hand, it is critical that the public and businesses trust our approach in procurement. They must trust that we are acting with integrity—an important word today—spending public money responsibly and that suppliers will be treated fairly. The Bill is a step forward, as the noble Lord, Lord Coaker, has been kind enough to acknowledge. On the other hand, we must not have a process which overall has a chilling effect because good honest suppliers who do not understand the arrangements are needlessly put off participating in procurement.

I turn to the various amendments tabled by the noble Lord, Lord Wallace, and spoken to with great passion by the noble Lord, Lord Scriven: Amendments 404, 407, 409, 410, 412, 413, 421, 422 and 423.

The Cabinet Office commissioned Sir Nigel Boardman to review communications procurement in the department. His first report was published in December 2020 and focused on Covid-19 and the difficulties then. A major public inquiry is now on the way, and of course we need to learn the lessons of that. However, his recommendations in that report have been substantially implemented by the department. For example, Procurement Policy Note 04/21 includes comprehensive guidance for authorities on how to ensure that conflicts are managed appropriately.

Before I comment on the individual amendments, I will try to reply to the comments made by the noble Lord, Lord Scriven. I emphasise that the Boardman recommendations have not been ignored. The Cabinet Office has implemented them in its commercial operations. It is not appropriate to put every recommendation into legislation, which of course applies for many different types of contracting authority and procurement —large and small. Our provisions allow for a framework in which authorities can implement best practice in accordance with their governance structures.

The noble Lord raised the subject of sanctions. Boardman’s recommendation 26 highlighted that there needed to be sanctions and that these should be made clear in policy and guidance. The Procurement Bill is not the place to detail every possible sanction for every breach. Disciplinary action should be for each authority to enforce as well. If a supplier believes there to be a breach, the Bill provides appropriate remedies in Part 9.

The noble Lord, Lord Scriven, also questioned the recommendations on direct award. As mentioned on Monday, we have introduced a new requirement that contracting authorities must now publish a transparency note before they award a direct award contract. This obviously did not happen during Covid and is a major safeguard.

Amendment 404 would require contracting authorities to take all steps to identify conflicts. This risks creating an impossible threshold for authorities to meet. It could always be argued that more steps should have been taken.

On Amendments 407 and 409, we agree that the Bill’s current scope of those “acting in relation” to the procurement is the right one. We have set out more detail on different groups of individuals involved in commercial guidance, as obviously there are broader groups now involved, in the Procurement Policy Note 04/21, which is the right place for that information. Amendment 410 would add obligations on suppliers relating to conflicts. Suppliers of course also have a role in mitigating conflicts, and this can be seen in Clause 75(2).

The Bill has generally sought to avoid regulatory obligations on suppliers, and such prescriptions are better placed in guidance than in legislation. This ensures that a proportionate approach can be applied by both smaller local councils and large central government departments. The purpose of Amendment 412 is to broaden the evaluation of conflicts. We do not think that this is needed, as the Bill already includes the principle of integrity, in Clause 11.

Amendment 413 requires that suppliers declare, during the procurement process, whether they have given a donation or loan of more than £7,500 to a political party in a calendar year. This was mentioned by the noble Baroness, Lady Bennett. UK electoral law already sets out a stringent regime of donation controls, which I am very familiar with. Donations from the same source that amount to over £7,500 in one calendar year are included. Donation reports are published online by the Electoral Commission for public scrutiny, providing an appropriate level of transparency. We do not see the need to add this to the Bill.

Amendments 421 and 423 concern former Ministers and civil servants. We certainly want to avoid the risks of individuals leaving the public sector and exploiting privileged access to contacts in government or sensitive information. To mitigate these risks, the Civil Service Management Code includes business appointment rules, which apply to all civil servants who intend to take up an appointment after leaving the Civil Service. They replace requirements on former civil servants which include standing aside from involvement in certain activities: for example, commercial dealings with their former department or involvement in particular areas of their new employer’s business.

[Baroness Brinton (LD)]

I am grateful to the Minister for allowing me to intervene. I absolutely accept the point about the change to civil servants’ arrangements. The example that I gave is outside the Civil Service, as would be many other contracts issued through this Bill when it becomes an Act. Can she assure me that every member of staff in any body or agency would be covered in the same way?

[Lord Scriven (LD)]

Before the Minister answers that, a number of times in my intervention I highlighted that there must be a standardisation not only for the Civil Service. Billions of pounds of procurement is carried out by non-central government departments. The rules need to be clear and uniform across the procurement process for the whole public sector, not just for government departments. That is a key issue and why many of these provisions need to be in the Bill, so that they are applicable to all public sector procurement bodies.

[Baroness Neville-Rolfe (Con)]

I thank the noble Baroness, Lady Brinton, and the noble Lord, Lord Scriven. I will not continue with the Advisory Committee on Business Appointments, as it sounds as though the Committee is familiar with that. Having experienced it, I would say that it is quite effective.

[Baroness Bennett of Manor Castle (GP)]

To take us back 30 seconds, to Amendment 413, about political donations over £7,500, I take the Minister’s point that yes, that register exists, but this amendment requires the supplier to take reasonable steps to make the declaration. If the supplier is not required to do that in their bid application, does that mean that every commissioning authority must add to their list of things to do, “Go and check the donations register every quarter to see what is happening”? Would not structuring it in this way make it much easier for the commissioning body?

[Baroness Neville-Rolfe (Con)]

I will start by trying to answer the point that the Civil Service has rules and this Bill is far wider in its application, which we accept. If we are too prescriptive in listing every relevant person in legislation, we may miss persons who should be considered. We think guidance provides a comprehensive list; Peers should see the guidance for commercial professionals in PPN 04/21, for example. As we have discussed in relation to other parts of the Bill, we have to have a combination of the Bill and guidance.

[Lord Scriven (LD)]

But this is the whole point of the Boardman review. By not having clear legislation and rules which are applicable across the public sector, we end up with things happening because they fall through the gaps. People in local government, for example, may not be aware of some of the guidance given to departments by central government, because it is not given to local government. It may be given to the ministry, but it does not necessarily filter down.

That is why we should have a standardised approach—which is not chilling. Then, regardless of whether you are in a local authority, the NHS, a central government body or an arm’s-length body, these are the rules on dealing with conflicts of interest. All that these amendments seek to put on the face the Bill is consistency across procurement in the public sector.

[Baroness Neville-Rolfe (Con)]

To come back to how you do it, you can do things in guidance as well as in the Bill. I take the noble Lord’s point that consistency would be helpful, but I have explained that there can be difficulties. I will just add that transparency will be a fundamental pillar of the new regime, which I think we all support. Extended transparency requirements, a single digital platform and so on will mean that decisions and processes can be much more closely monitored in future.

[Baroness Noakes (Con)]

Could my noble friend help me on the legal effect of the Civil Service management rules? It is my understanding that they cannot actually be enforced in a court of law because it would act as a restraint on the individual’s ability to earn a living. So the rules might exist and there might be advisory bodies et cetera, but it has always been my understanding that they cannot actually be enforced in a court of law. I am not trying to speak for the amendment, but the advantage of it is that it creates a statutory basis for it to have legal effect.

[Baroness Brinton (LD)]

My Lords, if I might try to assist, employment tribunals in the private sector have taken the view that you can have fairly tight, limited terms. I am sure that one of the reasons my noble friends Lord Wallace and Lord Scriven chose six months was that that is the sort of term that is acceptable.

[Baroness Neville-Rolfe (Con)]

I will look into the point about the Civil Service, but certainly people are very careful about the Civil Service rules when they leave. I say that as someone who left many years ago. The rules are observed by civil servants on the whole and we try to emphasise that. As has been said, what we are trying to do here is have a regime that covers not only the Civil Service but elsewhere. However, as always, my noble friend Lady Noakes has bowled a good ball, so I will look into that.

I turn now to Amendment 422, which proposes to introduce a power specifying how conflicts of interest are to be managed on a day-to-day basis. The Bill covers the plethora of organisations which make up the public sector and gives clear obligations on all contracting authorities to identify and mitigate their conflicts. It would not be wise to start dictating the implementation of such a process for each and every authority, so we do not think the power is right.

My noble friend Lady Noakes has spoken to Amendments 415 and 419 on the definition of a conflict of interest, and the noble Baroness, Lady Bennett, came in helpfully too. I recognise that Clause 74 does not explicitly define “conflict of interest” as it does “Minister”, for example. However, Clause 74(2), combined with the definitions, does give conflict of interest a meaning, so it is correct to say elsewhere, as in Clause 75(5), that conflict of interest has the meaning given by Clause 74.

By inference, then, a conflict of interest is where a personal, professional or financial interest of a relevant person, as set out in Clause 74, could conflict with the integrity of the procurement. Essentially, this is where there is a risk that someone from the contracting authority, who is involved in the procurement, could benefit from taking a decision that might not be in the best interests of the contracting authority itself.

Finally, there is Amendment 417, which would remove Clause 76(4). I reassure my noble friend that the purpose of Clause 76(4) is to help, not hinder, contracting authorities. A perceived conflict, as provided for in Clause 76(4), is where a person might wrongly believe there to be a conflict when in fact no actual or potential conflict arises. We must obviously make sure that the public and suppliers are confident that the public sector is conducting its procurements in a fair and open way. We therefore need to consider what others may perceive about the procurement process. I have asked officials to look at the precise wording in Clause 76(4) to ensure that this is properly expressed and is not misleading. I hope that at this late hour my contributions have helped noble Lords to understand the balance that we are trying to draw and what we are trying to achieve. I respectfully request that the amendment be withdrawn.

[Lord Scriven (LD)]

I thank the Minister. The Committee will have to give her 10 out of 10 for trying to explain, but we might not give as high a score on being convinced that she has alleviated some of our concerns.

Many noble Lords who have spoken on this group have tried to explain that the balance seems wrong. That is the issue in terms of conflicts of interest. The puzzling thing for all of us is that the Government agreed and accepted the Boardman recommendations, and some of them need to be in the Bill. Like other noble Lords, I accept that not all of them need to be, but some do.

These clauses have been written in haste. The noble Baroness, Lady Noakes, gave a definition. Clause 75(2) states:

“Reasonable steps may include requiring a supplier to take reasonable steps.”


So a reasonable step is a reasonable step. Unless the Government come back on Report with some serious amendments to this, I think we on these Benches will want to consult His Majesty’s loyal Opposition to see how we can strengthen this. As other noble Lords have said, this is really important in terms of the public’s perception and their trust that their taxes are being used in a way where no one gets an unfair advantage. That is what these amendments are about.

[Baroness Neville-Rolfe (Con)]

Clearly, trust is important and we are trying to do the right thing here. We are also trying to have a balance so that the interest provisions do not have a chilling effect. I said that right at the beginning. In any event, we are planning to have further meetings between now and Report, and it is something we should add to the agenda.

[Lord Scriven (LD)]

I hope the Minister has heard what I said; this is about getting the balance right. Certain things probably need to change and others might be referred to in guidance. Having said that, I beg leave to withdraw the amendment.

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Moved by

[Baroness Neville-Rolfe]

414: Clause 75, page 48, line 34, leave out from “must” to end of line 35 and insert “in relation to the award—
(a) treat the supplier as an excluded supplier for the purpose of—(i) assessing tenders under section 18 (competitive award), or(ii) awarding a contract under section 40 or 42 (direct award), and(b) exclude the supplier from participating in, or progressing as part of, any competitive tendering procedure.”

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Moved by

[Baroness Neville-Rolfe]

427: Clause 78, page 50, line 20, leave out “Where” and insert “If”

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Moved by

[Baroness Neville-Rolfe]

429: Clause 79, page 51, line 5, leave out “where” and insert “if”

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Moved by

[Baroness Neville-Rolfe]

431: Clause 80, page 52, line 8, leave out “the whole” and insert “all”

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[Baroness Hayman of Ullock (Lab)]

My Lords, I shall be very brief, as time is ticking away. I start by saying that we completely support Amendment 436 in the name of the noble Lord, Lord Lansley. It is really important to get proper reassurance and clarification in this area, and I hope that the Minister will be able to give that to us today.

We also absolutely support what Amendment 441, in the name of the noble Lord, Lord Purvis, is trying to do. Environmental, social and labour conditions are incredibly important when looking at who you are procuring with. The noble Lord introduced it very thoroughly, so I will not go into any further detail, but he is absolutely right that we need clarification on this.

One thing I have found with this Bill is that different bits are cross-referenced all the way through and, on occasion, I have got somewhat confused, to say the least. This might not be important at all but I ask for some clarification. Schedule 9 is on the various parties with which we have trade agreements, and we have been talking about trafficking, slavery, exploitation and so on, which are all mentioned in Schedule 7. We welcome the fact that Schedule 7 covers all these areas, but paragraph 2 of that schedule says that engaging in conduct overseas that would result in an order specified in paragraph 1—trafficking, exploitation, modern slavery and so on—if it occurred in the UK constitutes a discretionary ground for exclusion from procurement. Does that conduct overseas, as referred to in Schedule 7, cover anything that happens with procurement coming out of a trade agreement? That is what I do not understand. If it does, it alters what we have just been talking about. If it does, how does that operate and how is it enforced? Who manages it? If it does not, how do we address that when we are negotiating trade agreements in order to achieve the outcomes that we would all like to see? It may be that the Minister does not know and needs to talk to officials, but that is something on which I would like clarification.

[Baroness Neville-Rolfe (Con)]

My Lords, this group seeks to deal with amendments relating to treaty state suppliers. There are three minor government amendments either to improve the drafting or to ensure the proper functioning of the clauses, Amendments 438, 440 and 442. As the time is late, I will not go into detail, but I am happy to explain them to noble Lords on another occasion if they wish.

Amendment 436, tabled by my noble friend Lord Lansley, proposes that regulations could be made only in relation to agreements that had been laid before Parliament under the Constitutional Reform and Governance Act 2010. The use of regulations in the Procurement Bill in relation to implementing international agreements is limited to two circumstances. The first is to give effect to the procurement aspects of new trade agreements. For these, the Committee will know that treaties requiring ratification follow the established domestic scrutiny process set out in the CRaG Act. However, not all agreements will necessarily require ratification, and the amendment would place the implementation of such agreements outside the scope of this power. For the agreements that fall within the Act, the Committee will be aware that the Government have previously made commitments in our response to the International Agreements Committee, of which my noble friend is a prominent member, concerning the submission of international agreements to Parliament for scrutiny.

The second set of circumstances is to give effect to any changes to trade agreements over their lifetime. These are envisaged to be small technical changes, such as updating schedules following machinery-of-government changes or modifications to market schedules. In such circumstances, those more administrative matters may not trigger the CRaG procedures and, as such, the amendment would prevent them being implemented using this power. Any such updates and modifications would therefore require new primary legislation to implement, at a huge cost in time and resources. However, I reassure noble Lords that the Government intend to keep the relevant Select Committees aware of any changes during the life cycle of a free trade agreement.

Amendment 441, tabled by the noble Lords, Lord Purvis and Lord Wallace, seeks to provide that a contracting authority does not discriminate against a treaty state supplier if it takes into account environmental, social and labour considerations and indicates in the notice of intended procurement or tender documentation how such considerations are defined. The impact of this would be that a contracting authority could, within the rules, apply environmental, social and labour considerations in a way that breached a treaty state supplier’s entitlement to no less favourable treatment, and that would risk breaching our international obligations. For example, if a contract can be delivered remotely from an overseas base, our obligations to ensure no less favourable treatment for treaty state suppliers mean that it would not be appropriate for a contracting authority to require socioeconomic or environmental criteria that could not be performed from overseas. However, I assure the Committee that the Bill as drafted allows contracting authorities to include social, environment and labour considerations when setting award criteria, as long as they are non-discriminatory.

[Lord Purvis of Tweed (LD)]

I am grateful for that response. I struggle with the first part of what the Minister said because I lifted the wording from Articles 16 and 17 of the Australia agreement. If we have those obligations with Australia, how are we not able to provide that with all the other treaty state suppliers in the schedule where we do not have that language? Japan is lower than that, for example. I am struggling to understand why that would be the case. If she is reassuring me that the power provided by my amendment is already within the Bill, she has basically contradicted her own argument that we are not providing that to all the other countries. I do not understand.

[Baroness Neville-Rolfe (Con)]

The noble Lord’s question was why social considerations are not in the Japan agreement but they are in the Australia agreement. The answer is that every trade deal is unique. The noble Lord is trying to apply one principle to all trade deals.

[Lord Purvis of Tweed (LD)]

That is what the Government are doing. All the other requirements in the Bill are not in the trade agreements with other countries. That is the point that I was making. The Government are introducing a whole set of requirements under the Bill that are not in treaty obligations. I am just trying to say that it would be better if this were consistent.

[Baroness Neville-Rolfe (Con)]

The honest truth is that we seem to have a bit of a disagreement on this; maybe a bilateral discussion would be helpful. The noble Lord, Lord Lansley, also raised a question on which we should have a further discussion; I will write to him on that on the points he was raising. We had advice from the people involved in trade agreements in preparing our response.

[Lord Purvis of Tweed (LD)]

I am very grateful for that offer. I am very happy for it to be multilateral rather than bilateral if that assists the Committee. If the Minister wants to make officials available for the discussion, I will be happy with that, or she may want to write to me in advance of that. It will be helpful if she is able to write to Members before we have a discussion, so that we get a bit more information from the Government first. I will then be more than happy to have the discussions with her about this before Report.

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[Baroness Neville-Rolfe (Con)]

That would be helpful. We can certainly look at Hansard and write a letter, but we should get together in the next 10 days or so to try to sort this out, because it is complicated—that was clear from being at the briefing.

The noble Lord asked one or two questions which I can clarify. Schedule 9 lists countries, states or regions with which we have an agreement that covers procurement —obviously, that is the purpose of that schedule. All the agreements in that schedule are binding; in contrast, obviously MoUs are not legally binding. On the Colombia agreement, any human rights obligations in the Andean trade agreement will have been reviewed by the CRaG process before it came into force—I think that was probably accepted—and the procurement chapter in trade agreements must be complied with unless these agreements are breached and coverage withdrawn.

Following that agreement with the noble Lord, I move on to Amendment 443A, tabled by my noble friend Lady McIntosh, which proposes to remove the power of a Minister of the Crown to make regulations under Clause 83. Under current drafting, either a Minister of the Crown or a Scottish Minister is entitled to make regulations to ensure that treaty state suppliers are not discriminated against in Scotland in relation to devolved procurement. The use of these concurrent powers would allow either the Minister of the Crown or a Scottish Minister to legislate with respect to devolved procurements in Scotland in order to implement new and existing international trade agreements. Similarly, concurrent powers were used in Section 2 of the Trade Act 2021. Of course, the power would not prevent Scottish Ministers legislating in respect of devolved procurements. However, in the event that they chose not to do so or if they wished, perhaps for reasons of efficiency, to allow a single set of regulations to implement a new trade agreement, this power would allow a Minister of the Crown to pass the necessary legislation. I should say that we continue to engage with the Scottish Government on this and other matters; your Lordships will have seen that the new Prime Minister has indeed spoken to the First Minister since his appointment.

I think we have probably debated this as much as we can this evening.

[Baroness Hayman of Ullock (Lab)]

Can the Minister clarify the question around Schedule 7 or will we perhaps discuss that when we get together at the meeting?

[Baroness Neville-Rolfe (Con)]

I think the greatest brains behind me have not managed to answer the noble Baroness’s question—she has bowled another good ball. Perhaps we can add that to the list for our discussions.

With that, I hope that the noble Lord will withdraw his amendment.

[Lord Lansley (Con)]

My Lords, only 110 amendments to go, so, with the benefit of that promise of further discussions, I beg leave to withdraw Amendment 436.

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Moved by

[Baroness Neville-Rolfe]

438: Clause 81, page 53, line 17, leave out “or services” and insert “, services or works”

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Moved by

[Baroness Neville-Rolfe]

440: Clause 82, page 53, line 37, at end insert—
“(3A) In this section, a reference to a supplier’s association with a state includes a reference to the fact that the state is the place of origin of goods, services or works supplied by the supplier.”

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Moved by

[Baroness Neville-Rolfe]

442: Clause 82, page 53, line 42, leave out “virtue of” and insert “reference to”

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Moved by

[Baroness Neville-Rolfe]

446: Clause 84, page 54, line 35, leave out “An appropriate authority” and insert “A Minister of the Crown or the Welsh Ministers”

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Moved by

[Baroness Neville-Rolfe]

457: After Clause 88, insert the following new Clause—
“Data protection
(1) This Act does not authorise or require a disclosure of information that would contravene the data protection legislation (but in determining whether a disclosure would do so, take into account the powers conferred and the duties imposed by and under this Act).(2) In this section “the data protection legislation” has the same meaning as in the Data Protection Act 2018 (see section 3 of that Act).”

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Moved by

[Baroness Neville-Rolfe]

461: Clause 89, page 56, line 32, at end insert—
“(4A) A contracting authority’s duty to comply with section 12(9) or 13(8) (requirement to have regard to procurement policy statements) is not enforceable in civil proceedings under this Part.”

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Moved by

[Baroness Neville-Rolfe]

464: Clause 90, page 57, line 11, after “if” insert “during any applicable standstill period”

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Moved by

[Baroness Neville-Rolfe]

469: Clause 91, page 57, line 33, leave out “entering” and insert “entry”

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Moved by

[Baroness Neville-Rolfe]

470: Clause 95, page 60, line 1, at end insert—
“(A1) A supplier must commence any specified set-aside proceedings before the earlier of—(a) the end of the period of 30 days beginning with the day on which the supplier first knew, or ought to have known, about the circumstances giving rise to the claim;(b) the end of the period of six months beginning with the day the contract was entered into or modified.”

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Moved by

[Baroness Neville-Rolfe]

481: Clause 96, page 61, line 12, at end insert—
““section 97 recommendation” has the meaning given in section 97”

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Moved by

[Baroness Neville-Rolfe]

483: Clause 98, page 62, line 14, after “to” insert “relevant”

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Moved by

[Baroness Neville-Rolfe]

496: Clause 100, page 63, line 28, leave out “in” and insert “by”

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Moved by

[Baroness Neville-Rolfe]

501: Clause 101, page 64, line 5, at end insert “or 98 (guidance following procurement investigation)”

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Moved by

[Baroness Neville-Rolfe]

510: Clause 102, page 65, line 28, after “framework” insert “agreement”

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Moved by

[Baroness Neville-Rolfe]

518: Clause 103, page 66, line 6, leave out “section” and insert “Act”

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Moved by

[Baroness Neville-Rolfe]

520: Schedule 10, page 108, line 6, leave out “the parties to it agree”

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Moved by

[Baroness Neville-Rolfe]

533: Clause 110, page 70, line 10, leave out “Part 2” and insert “section 29”

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Moved by

[Baroness Neville-Rolfe]

536: Clause 111, page 70, line 35, leave out “payable” and insert “paid, or to be paid,”

[Baroness Neville-Rolfe (Con)]

My Lords, this final group deals with amendments on VAT. The Government’s Amendment 536 simply broadens the notion of amounts payable to include amounts that have already been paid, as contracting authorities may be required to take into account expected or completed payments.

I turn to Amendments 537 and 538. With the agreement of the Committee—I have agreed this with my noble friend Lady Noakes, whose amendments they are—I will reply to her later.

[Baroness Noakes (Con)]

My gift to the Committee is not to make an extended speech on the subject of value added tax. I know that many noble Lords would like to hear that, but we have expedited procedure and my noble friend the Minister will respond instead.

[Baroness Neville-Rolfe (Con)]

I am very grateful to my noble friend Lady Noakes, who, as usual, has come to the rescue. She raised the question of whether VAT should be taken into account when calculating the value of a concession contract. I confirm that, when a contracting authority values a concession contract, it should calculate the maximum amount the supplier could expect to receive. I thank my noble friend for raising whether this policy intent is adequately covered in the current drafting of Clause 111 and will give this careful consideration ahead of Report.

My noble friend Lady Noakes also asks why the formulation

“any amount referable to VAT”

has been used in Clause 111(2). Amendment 538 proposes to remove the words

“a reference to any amount referable to”.

As I understand it, the amendment does not aim to change the effect of the clause. Rather, the intent is to rationalise the drafting. I assure noble Lords that the proposed edits have been carefully considered and the existing wording is thought to be better suited to achieving the desired policy outcome.

I therefore respectfully request that these amendments be withdrawn. I will move the other government amendments in my name but, before I sit down, I thank our Deputy Chair of Committees and the Committee for their patience and good humour with the large number of government amendments. We will try to keep up our good record of government engagement and do better on the number of amendments.

[Lord Fox (LD)]

I would just like to congratulate the Minister on the smooth transition from Back-Bench jabs to Front-Bench defence. We look forward to seeing the reprinted version of the Bill so that we can start to track where all these amendments have gone and what they do. We also look forward to the meetings we will be having to sort these matters out.

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Moved by

[Baroness Neville-Rolfe]

539: Clause 112, page 71, line 3, leave out “supplier” and insert “person”

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Moved by

[Baroness Neville-Rolfe]

541: Clause 112, page 71, line 25, leave out “35” and insert “34”

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Moved by

[Baroness Neville-Rolfe]

544: Clause 112, page 72, line 11, at end insert—

requirements

section 18”

Procurement Bill [HL]

Baroness Neville-Rolfe Excerpts

Committee stage
Monday 24th October 2022 Grand Committee

[Baroness Hayman of Ullock (Lab)]

My Lords, I also start by welcoming the Minister to her new role. I thank her and her officials for having a useful meeting with us ahead of today. Let me say how pleased we are to have a Minister who is genuinely interested in this Bill. The noble Lord, Lord Fox, talked about the Minister’s previous involvement; I am sure that her knowledge and interest will lead us into a better place.

I will start with the two amendments in the name of my noble friend Lord Hunt of Kings Heath, Amendments 177 and 180, to which we offer our strong support. Clearly, all of us should embrace anything we can do to tackle tax abuse and tax avoidance. I hope the new Government—we are looking forward to hearing what they have to say—will prioritise this area.

My noble friend talked about Amazon, the lack of accountability and the kind of poor practice that is replicated by many companies, and gave a thorough explanation of why the legislation in front of us could be used to make a difference to cases of tax avoidance and abuse. I hope the Minister listened to those concerns seriously and considers whether this Bill is an appropriate vehicle to address them.

The noble Lord, Lord Fox, introduced a number of amendments in the name of the noble Lord, Lord Wallace, to which I have added my name. I will not go into them in detail, only to say that we support incorporating evasion of criminal sanctions into the Bill. The failure to prevent bribery offences has been incredibly disappointing, and the Bill could be used to tighten that up and make more progress. Also clearly disappointing are the very few convictions there have been under the Proceeds of Crime Act. How can we use this Bill to make a difference in these areas where there is still concern? I am sure all noble Lords agree that we need to ensure proper and effective enforcement to curb any serious wrongdoings in these areas.

Briefly on Amendments 323, 326 and 327, in the name of the noble Baroness, Lady Noakes, she clearly introduced something that I had not really considered until I read these amendments. Again, “considered” is the important word here. She is absolutely right that you need to think about the strength of a subjective test and how it would be interpreted. I completely agree with her; we need to understand this better. I would be interested to hear from the Minister on this, because the noble Baroness, Lady Noakes, is correct that judicial review is simply not a practical option for SMEs; it just is not. How will this be interpreted and managed through the Bill? I look forward to the Minister’s responses.

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

My Lords, I thank all noble Lords for their kind welcome on my appointment as Minister of State at the Cabinet Office. I echo the words of the noble Lord, Lord Hunt, about my predecessor, my noble friend Lord True, and his willingness to engage—a model I will try to follow. I am very much in listening mode today, as we are still in Committee, working on the Bill.

I am poacher turned gamekeeper, and that can be a good qualification. As noble Lords know, I have consistently taken a keen interest in the Bill, although from a slightly different perspective. I will not delay you with a long introduction, but I am pleased that the Bill consolidates 350 EU regulations. That is simplification at a stroke: it streamlines public procurement and reduces burdens on business, and it turns EU-based law into UK law, which is why we can be confident of its progress.

In particular, it will benefit SMEs, for which we must do our best to offer a level playing field, so that they can increase their share of the £300 billion spent by public authorities each year. I think the noble Baroness, Lady Bennett, will agree with that. I am also looking forward, if I get the chance, to rolling out training on the Bill—simple, clear, comprehensive training in central and local government, and elsewhere. That will answer some of the concerns that I and others across the House have had on the Bill.

I thank noble Lords for their contributions on the grounds for financial exclusion and will try to respond constructively. I begin with Amendments 177 and 180 tabled by the noble Lords, Lord Hunt and Lord Hain. These seek to ensure that the suppliers who fail to provide contracting authorities with various details in relation to their tax affairs when bidding for contracts must be excluded from procurements. I should start by making it quite clear that the Government expect businesses to take all necessary steps to comply with their tax obligations.

However, noble Lords will know that the basis on which contracts must be awarded under the Bill is by reference to award criteria that relate to the contract being tendered, not to other matters such as where a supplier pays tax. This is the right principle to deliver value for money for the taxpayer and ensures that suppliers are not required to provide swathes of information that is irrelevant to the contract. This principle is also a feature of the UK’s international obligations, notably under the WTO government procurement agreement. It is for His Majesty’s Revenue and Customs to enforce the law on tax and, indeed, UK-based multinational enterprises are required to make an annual country-by-country report to HMRC. I note what was said by the noble Lord, Lord Hunt, about Amazon.

The grounds for exclusion in the Bill focus on criminal convictions and other serious misconduct that raises a risk to public contracts, including, importantly, in relation to tax. But investigation does not mean guilt in this country. Exclusion is not a substitute for a judicial process. It is important to let due process run its course before subjecting suppliers to mandatory exclusions.

However, we have broadened the scope of the current regime with the mandatory exclusion grounds related to tax in Schedule 6, which cover all tax evasion offences and involvement in abusive tax arrangements. This is a significant broadening from the current regime, which is limited to where there has been a breach of tax obligations and lets suppliers off where they have repaid or committed to repay unpaid tax. I am confident that these grounds are sufficient to protect contracting authorities and taxpayers.

[Lord Fox (LD)]

During that spirited defence of the need to keep things open for international companies to be able to bid, the Minister used the phrase “value for money”. Can she define the Government’s view of how they calculate value for money?

[Baroness Neville-Rolfe (Con)]

If I may, I will think about the answer, make some progress, and come back to that on a future occasion.

[Lord Fox (LD)]

It is surprising that the Minister cannot answer that.

[Baroness Neville-Rolfe (Con)]

Well, I think that “value for money” is a clear term, but I am listening seriously to the point that the noble Lord is making in this context. Value for money is about quality and quantity; indeed, it is about many things, as I know, having been on the buyer side in real life as well as on the selling side. As for what the definitions are in the Bill, I am not sure.

I come back to the important points from the noble Lord, Lord Hunt, on the subject of tax. It was clear from feedback on the Green Paper that the existing tax exclusion ground is one that many authorities are struggling to apply. By reframing the ground in terms of UK offences and regulatory decisions, we believe that it should be easier for UK contracting authorities to apply this. I also add—because I remember it well from the time that I served in David Cameron’s Government—that the UK has tried to lead the way internationally in making sure that multinational companies pay their share. Strong HMRC compliance action has secured and protected over £250 billion for public services since 2010 that would otherwise have gone unpaid, including £3 billion from those trying to hide money abroad. This is work that goes on—and work to which HMRC is devoted, as I remember well.

The noble Lord also raised tax havens. The Bill will deliver unprecedented levels of transparency in procurement, including—this point needs to be made—with respect to the beneficial ownership of suppliers. All suppliers will be expected to declare their beneficial owners when bidding for contracts. Failure to provide accurate details of beneficial ownership when asked will now be a mandatory ground for exclusion.

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[Noble Lords]

Oh!

[Baroness Neville-Rolfe (Con)]

I try to wake up early, as noble Lords know. Value for money is not defined in Clause 11(1)(a), to leave a degree of flexibility for future refinement. In practice, we will use the HMT definition, which is currently,

“the optimal whole-life blend of economy, efficiency and effectiveness that achieves the intended outcome of the business case.”

It is quite a nice mixture—economy, efficiency and effectiveness.

[Lord Fox (LD)]

I thank the Minister, but the question I was rather clumsily trying to ask was whether we extract from the cost the amount of money we expect to take in tax or merely use the cost as a flat sum. In other words, with a British company paying full British tax versus one of the companies described by the noble Lord, Lord Hunt, which pays no tax, does the overall cost of that service become less for the one paying tax? It seems the Minister’s answer is that the tax take is not included in the calculation of value for money.

[Baroness Neville-Rolfe (Con)]

I think we have made a bit of progress; I will not go down that rabbit hole or we will not make enough progress.

If I might, I turn to Amendments 306, 307, 308 and 320 tabled by the noble Lords, Lord Wallace, Lord Fox and Lord Hain. They would introduce new mandatory exclusion grounds in relation to offences of sanctions evasion, money laundering and failure to prevent bribery, and new discretionary exclusion grounds in relation to various financial and economic misconduct when the contracting authority has sufficient evidence in the absence of a conviction.

The mandatory grounds for exclusion cover the types of misconduct which raise only the most serious risks for contracting authorities. We have already strengthened the mandatory grounds significantly in comparison to the EU regime, but they cannot and should not cover every offence. On sanctions, the types of freezing orders referred to in the amendment are unlikely to be relevant to public contracts. On bribery and money laundering, we have included a range of mandatory exclusion grounds covering the most serious offences. This expands the scope of the offences covered in the EU regime to cover blackmail as well as bribery. However, I reassure noble Lords that the offences in question which are not listed as mandatory exclusion grounds are likely to be subject to discretionary exclusion, under the ground of professional misconduct. This will depend on the circumstances, but if the ground is met, contracting authorities could exclude the supplier.

As to the amendment to include financial and economic misconduct as a new discretionary exclusion ground, we have already explained to this Committee that the exclusion regime is not a substitute for a judicial process. I am not prepared to require contracting authorities to weigh up complex evidence of financial and economic misconduct in which they have no relevant experience. That is a key issue with the ambitious proposals described by the noble Lord, Lord Fox.

Amendments 323, 326 and 327, tabled by my noble friend Lady Noakes, concern the discretionary exclusion grounds for potential competition infringements and the test for when these apply. These exclusion grounds recognise that there may sometimes be evidence of competition infringements in the absence of a regulatory decision or ruling. It is critical that suppliers known to have been involved in collusion, bid-rigging and anti-competitive behaviour are held to account, given the fundamental importance of fair and open competition to procurement.

However, I reassure the Committee that these grounds should not be used to exclude suppliers merely because they are under investigation by the CMA or another regulator; there must be sufficient evidence that a breach of competition rules has occurred. I think my noble friend pointed out that the language used in the Explanatory Notes differs from that in the Bill. I am advised that this does not reflect a difference of policy or meaning. Authorities must “consider” that the conduct specified has occurred before determining that the exclusion ground applies. She went on to ask about why there were subjective tests in the discretionary grounds. I have to say that I had some difficulty in exactly following her logic in all this, and we may need to discuss these points further after Committee. The answer is because exclusion is a risk-based measure and a last resort, and suppliers are protected by a right to challenge the exclusion decisions because of the nature of those decisions.

[Baroness Noakes (Con)]

A moment ago my noble friend said, in respect of the amendment by the noble Lord, Lord Fox, that she did not want decision- makers trying to weigh up complex financial matters, but she somehow seems quite happy to have decision-makers weighing up equally complex matters scattered throughout Schedule 7 and in the discretionary exclusion grounds. I struggle to see the intellectual cohesion in the Government’s position.

[Baroness Neville-Rolfe (Con)]

I thank my noble friend for her further comments, which I will consider carefully. I myself feel strongly, as someone who has witnessed small construction companies being investigated by a competition authority that at the end of the day have been found completely innocent, that it would be difficult if they were not able to continue to engage in procurement during a long period of investigation. However, as she explained, we need to get right how we deal with the discretionary grounds and ensure that there is enough certainty so that authorities do not spend too much time going round in circles. We need to reflect further on the points that she has made. I think I slightly misunderstood the purport of her original amendment, so I look forward to discussing that with her. I thank the noble Lord, Lord Fox, for his intervention.

[Lord Fox (LD)]

I thank the Minister for her response. The notion of, in a sense, using professional misconduct as the catch-all for everything else is something that we could pursue after Committee. It may be something that requires some definition or clarification, either within the legislation or from the Dispatch Box on Report. If that is going to be the way that the Bill operates, some clearer idea as to how it would work would help to ameliorate some of the fears that have been expressed around the Bill.

[Baroness Neville-Rolfe (Con)]

We have to get the right result but we also have to avoid a chilling effect. That is my basic approach to this.

[Lord Fox (LD)]

A chilling effect on corruption?

[Baroness Neville-Rolfe (Con)]

A chilling effect on corruption is obviously positive but a chilling effect on people being prepared to engage in government procurement is not, particularly smaller suppliers, which might be put off by some of these rules. That is why we brought in Schedule 6, which will bring a certain clarity. There may be some further discussions to be had on Schedule 7 and exactly how it works.

[Lord Purvis of Tweed (LD)]

I too welcome the Minister to her position. My question relates to a later group in which I have an amendment. Given that the Bill will allow for there to be no discrimination against any treaty-state supplier, how will a contracting body or procurement body operate under Schedule 7 for any of the suppliers from any of the countries with which we have a trade agreement? This comes back to the point made by the noble Baroness, Lady Noakes. It is not simply the case that businesses are going to have to work through Schedule 7 to satisfy all the grounds for this; they are going to have to do it with every single country with which we have an FTA for the suppliers coming from them. How is that making the job easier?

[Baroness Neville-Rolfe (Con)]

As the noble Lord said, we will come on to discuss those aspects, and I will try to answer that question when we get there. I have probably said enough on that.

Amendment 328 in the names of the noble Lords, Lord Wallace and Lord Fox, provides for a new discretionary exclusion ground in relation to deferred prosecution agreements. This issue was explored in the Green Paper. Due consideration was given to feedback from the public consultation, as well as discussions with the Serious Fraud Office and the Crown Prosecution Service. The Government’s response to the Green Paper set out the rationale for their decision not to include a separate exclusion ground on deferred prosecution agreements. In brief, the actions taken and commitments made by suppliers as part of the DPA typically constitute good evidence of self-cleaning. Reaching a DPA requires a supplier to accept culpability for the offence, co-operate with the relevant authorities and make reparations. Prosecuting authorities typically will not consider a DPA appropriate unless the supplier has already made reforms, such as proactive changes to corporate structures or the replacement of personnel.

DPAs will involve judicially approved terms that the supplier must commit to—for example, on actions to improve compliance and audit functions within the company, and external reviews to test those improvements to ensure that further misconduct does not occur. Non-compliance with a DPA is unlikely to be something that contracting authorities are equipped to assess. I hope that the noble Lord, Lord Fox, will understand and accept that.

Compliance is for either the Serious Fraud Office or the Crown Prosecution Service to assess, depending on which is the owner of the DPA in question. If a supplier fails to comply with a DPA, there are a number of options open to the enforcing body, including the prosecution of the supplier for the original criminal misconduct, but that cannot be part of procurement law, or for enforcement by the many differently sized authorities engaged in buying goods or services in the public sector.

Finally, Amendment 443 tabled by the noble Lord, Lord Wallace, seeks to remove

“a British Overseas Territory or a Crown Dependency”

from the definition of a UK supplier. The Bill confers rights on UK suppliers in a number of places, including, in Clauses 18 and 19, an entitlement to be considered as part of a competitive tender, or, in Clause 89, to access remedies. They are also used as the basis for an assessment of no less favourable treatment in the non-discrimination provisions, in Clause 82(2). This amendment would remove this guaranteed access to the UK’s procurement markets from suppliers from Gibraltar, which is the only overseas territory or Crown dependency whose suppliers currently enjoy access under the existing procurement regime.

Although overseas territories and Crown dependencies are not part of the UK constitutionally, they do not become party to treaties in their own right. The UK must extend the territorial scope of its ratification of treaties to include them. As such, overseas territories and Crown dependencies are unable to secure rights to markets in the United Kingdom in the same way as other states. That is a long way of saying that in view of the special nature of the trading relationship between the UK and overseas territories and Crown dependencies, it is right to include them in the definition of a UK supplier.

This discussion has been useful and illuminating to me. I respectfully request that the amendment be withdrawn.

[Lord Hunt of Kings Heath (Lab)]

My Lords, I am very grateful to the Minister. I particularly welcomed her comments on SMEs and training rollout. I really agree about the importance of investment in training as the Bill is enacted. However, I remain concerned about the Government’s approach, which seems supine in many respects when dealing with these multinational companies.

Only this afternoon at Oral Questions, we had a fascinating exchange about the remarkable decision to award Fujitsu a £48 million contract to upgrade the police national computer, given the role of that company in developing Horizon software for the Post Office. We were told by a Minister that in effect, there was no alternative because of the continuing arrangements with that company. Listening to the comments made by the noble Lord, Lord Fox, and the noble Baroness, Lady Bennett, about performance issues, corruption, competition infringements, which were added to by my noble friend, and the issues on tax, essentially the Minister has an ideological objection to the use of contracts to further government policy outside the narrow procurement interest. This is where I fundamentally disagree with her.

It is not good enough simply to say that it is down to HMRC. Procurement can be used to enhance policy in a number of areas. Many of these multinational companies are taking this country for a ride. We need to see tougher action. Having said that, I hope that we can continue to debate this important issue. I beg leave to withdraw my amendment.

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Moved by

[Baroness Neville-Rolfe]

178: Clause 30, page 19, line 26, at end insert “or”

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Moved by

[Baroness Neville-Rolfe]

181: Clause 30, page 19, line 32, leave out “suppliers” and insert “persons”

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[Baroness Neville-Rolfe (Con)]

My Lords, Amendment 185 would require the Minister to publish in regulations a list of countries considered to be at high risk of performing forced organ harvesting. It would also require contracting authorities to exclude suppliers from those countries from certain procurements.

Clearly, I appreciate the seriousness of the issue of organ harvesting; I agree that it is a difficult matter for the Government. This is an abhorrent practice, as we heard from the noble Lord, Lord Hunt, which is all the more egregious when sponsored by the state. It is an issue that has been frequently debated in recent years; I recognise the dedication with which it has been pursued by the noble Lords, Lord Hunt and Lord Alton, and the noble Baroness, Lady Northover, with the support today of the noble Baroness, Lady Finlay, and the noble Lord, Lord Ribeiro. It is understandable that they take opportunities such as today to draw attention to the awful things that are happening and the scale of the issue.

The noble Lord, Lord Hunt, is right to record that the Government are taking action to address this issue on a number of fronts. The Health and Care Bill was amended during its passage through Parliament to prohibit commercial organ tourism and send an unambiguous signal that complicity in the abuses associated with the overseas organ trade will not be tolerated. Equally importantly, the Government continue to monitor and review evidence relating to reports of forced organ harvesting in China, and they maintain a dialogue with leading NGOs and international partners on the issue. This includes Foreign, Commonwealth and Development Office Ministers writing to the World Health Organization in Geneva to encourage it to give careful consideration to the findings of the China Tribunal on organ harvesting, published in March 2020.

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[Baroness Neville-Rolfe (Con)]

My Lords, I was talking about the international angle and the importance of doing things internationally. I am particularly grateful for the reminder of the need to discuss these issues with my noble friend Lord Goldsmith of Richmond Park. I will also talk to the FCDO, DHSC and DIT about the UK-China hospital partnership and whether there has been any use of UK Export Finance. I have not been briefed on the issue, but I will write to the noble Lord, Lord Alton, who is not in his place, and the noble Baroness, Lady Northover, if they are content.

Turning to the main issue, I must resist this amendment on a number of counts, which I will explain. First, it treats suppliers as excluded simply for being located in a country at high risk of organ harvesting. This is guilt by association. It would undermine the principle, which runs throughout the exclusions regime, that suppliers can be excluded only where the supplier or a connected person has committed relevant misconduct. This is really important to ensure fairness and proportionality in exclusion decisions. The amendment could also have perverse effects—for example, preventing the NHS procuring life-saving devices in a country, even though they have nothing to do with organ harvesting or people trafficking.

Finally, there is already a provision in the Bill which would allow for the exclusion of suppliers who participate in forced organ harvesting. The Bill is clear that any serious breach of ethical or professional standards applicable to the supplier would meet the discretionary exclusion ground for professional misconduct. It is almost certain that involvement in these practices by suppliers of goods or services related to transplant medicine or human tissue would constitute a breach under the detailed standards set by health sector institutions.

The exclusion ground of professional misconduct is intended precisely to cover all the particular ethical issues that arise in different industries and sectors. That is of course an exclusion we agreed earlier, which merited further discussion. The grounds for exclusion cannot and should not list every issue within a particular industry. I should repeat that the exclusion and debarment regime in the Bill represents a significant overhaul and enhancement of the EU system; we should not forget that.

Finally, to respond to the noble Lord, Lord Alton, I have already promised, in his absence, to write on the subject of the hospital, but I am also of course aware of the concerns regarding Hikvision.

[Lord Alton of Liverpool (CB)]

I apologise to the noble Baroness; I got trapped in the Chamber when the doors were locked at the end of the Division—it serves me right. Some people may wish it had been permanent. I am grateful to the noble Baroness and look forward to reading her reply in Hansard.

[Baroness Neville-Rolfe (Con)]

I look forward to getting delayed in the Lobby in the next Division.

I am aware of the concerns regarding Hikvision and other Chinese technology companies; we take these concerns extremely seriously, as the noble Lord knows. We are taking action in the Bill to introduce a new ground for exclusion, specifically to address situations where a supplier poses a threat to national security. The new exclusion ground allows a contracting authority to reject bids from suppliers that the authority considers pose a threat to the national security of the United Kingdom.

It is the long-standing policy of successive British Governments that judgment as to whether genocide has occurred is for a competent national or international court. It is not for the contracting authorities. Genocide is a crime and, like other crimes, whether it has occurred should be decided after consideration of all the evidence available in the context of a credible judicial process.

This has been an important debate. I have learned a lot but, for today, I respectfully request that this amendment be withdrawn.

[Lord Purvis of Tweed (LD)]

I would be grateful if the Minister could clarify a little her argument as to why organ trafficking—which is prohibited under the UK’s statute book—cannot be mentioned in Schedule 6 under the mandatory exclusion grounds. Under labour market, slavery and human trafficking offences, there is a fairly comprehensive list of UK domestic offences that are mandatory grounds. I do not see why that list cannot be added to, as I cannot see where the ethical grounds are included within Schedule 6 on the mandatory grounds.

Can the Minister also clarify why, in Schedule 7, on discretionary grounds, those offences are included for prevention orders? The Government seem to be suggesting that for a company that is subject to prevention orders for these heinous crimes—or could be subject to them, if it were a foreign supplier—this is simply discretionary. A contracting body would have to make a judgment itself as to what it considers would be the likelihood of a supplier meeting the threshold for a prevention order, rather than an offence. That does make any sense to me. I would be grateful if the Minister could address those two points.

[Baroness Neville-Rolfe (Con)]

I will need to take the noble Lord’s first point away and look at it. His explicit point is that there is a bit of legislation, so why do we not refer to it? His second point is tied up with how this discretionary schedule works and how we define “professional misconduct”, which, in our interpretation, includes ethical issues. I thank him for raising these issues again.

[Lord Purvis of Tweed (LD)]

I would be grateful if the Minister were willing to consider this. It is not about the ethical point. It comes under paragraph 1 of Schedule 7, which is headed “Labour market misconduct”. Sub-paragraphs (a) to (d) specifically refer to slavery and trafficking prevention orders and trafficking and exploitation prevention orders. If a supplier is considered to be acting in a way that would satisfy a prevention order in the UK, it would be a discretionary exclusion ground rather than what I consider it should be: a mandatory exclusion ground. I am happy for the Minister to reflect on it and write if she cannot answer today.

[Baroness Neville-Rolfe (Con)]

Clearly, I have learned during this debate. I will obviously have to learn a little more about how we have tackled this issue. As was said right at the beginning of the debate, there is clearly some difficulty around the principle of how much detail to include and how many things to cross-reference in the Bill but, in the light of the noble Lord’s helpful clarification, I will go away, look at the various areas and come back to him.

[Lord Hunt of Kings Heath (Lab)]

My Lords, this has been a very interesting debate. I am grateful to the noble Lord, Lord Alton, the noble Baroness, Lady Northover, and my noble friend Lord Coaker for their profound speeches. Of course, I also thank the noble Baroness, Lady Finlay, and the noble Lord, Lord Ribeiro, who cannot be here today.

The noble Lord, Lord Alton, put a number of pertinent questions to the Minister, not just about the UK-China hospital partnership but more generally about the principles behind our trade with China. I must say that I find government policy inconsistent and incomprehensible. The new Administration, if I can call them that, need to get a grip on what exactly our relationship with China ought to be in terms of diplomacy, trade and strategic investment. Over the past few years, it has seemed completely all over the place.

There is an argument—my noble friend Lord Coaker referred to it—about the principle of how much we should use procurement legislation for wider, desirable policy aims. I believe passionately that it is right to use a Procurement Bill to try to influence this abhorrent practice. I am grateful to the Minister because she gave a careful response and appreciated the seriousness of this abhorrent practice, which we are doing our best to help eradicate. She also acknowledged the changes made in legislation in the past few years. However, she was critical of the amendment’s wording; she has quickly taken on the mantle of ministerial office again, by finding all amendments that do not emanate from her own department technically deficient.

The Minister’s key point around what is wrong with the amendment is that it is guilt by exclusion. I understand that but I believe that the amendment is tightly drawn. It is not just about excluding suppliers

“located in a country categorised … as at high risk of forced organ harvesting.”

It would exclude only in the event of

“a public contract involving … any device or equipment intended for use in organ transplant medicine or activities relating to”

that. That is tightly drawn and entirely justifiable.

The Minister also said that these practices would be covered by the exclusion grounds in the Bill. We have now had a debate on that; I thought that the noble Lord, Lord Purvis, raised some important questions. I accept that one can look to general provisions in a Bill and say, “Well, those cover it”, but I believe that there is sometimes a strong place for explicit provision on a practice that we find abhorrent. I hope that the Minister will be prepared to discuss this with us between Committee and Report because I am convinced; I am grateful to my noble friend Lord Coaker for his pertinent comment that we will come back to this on Report. Having said that, I beg leave to withdraw the amendment.

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[Baroness Neville-Rolfe (Con)]

My Lords, this is a rather confusing group, so I will start by speaking to the two government amendments. Amendment 237 removes duplication of the direct award ground, which is adequately covered in Clause 41; and Amendment 245 requires appropriate assessment prior to the direct award of whether a supplier previously submitted an unsuitable tender.

Looking at the group in the round, the noble Baroness, Lady Hayman, and the noble Lord, Lord Coaker, raised Amendment 235A, so that we could rightly debate the direct award of contracts; and the noble Lord, Lord Wallace, in his absence, gave notice of his intention to object to Clauses 40 and 41—I think because he wants to understand what is happening and wants answers to some of the questions that have been put by the noble Lord, Lord Fox.

Clause 40 permits a direct award to a supplier, other than an excluded supplier, if a justification in Schedule 5 is met. This is based on the World Trade Organization’s Agreement on Government Procurement grounds for limited tendering and is similar to the current law. We have been commended by external stakeholders for bringing clarity to the justifications and reducing the risk of unintended use of these provisions. As the noble Baroness said, publication of transparency notices is an extremely important development.

Just to let noble Lords know, I will deal with standstill provisions in the next group so, in the interests of time, will not cover them in this group. But I will deal here, a little later, with sunset clauses, which the noble Baroness also raised.

I was very interested to hear the explanation for Amendments 235ZA and 243A from the noble Lord, Lord Clement-Jones. He made a lot of points that I was not aware of, which I will study, in relation to the important areas of cloud computing and UK businesses. But I make clear that existing frameworks allow contracting authorities to buy cloud-based services separately, rather than in a package. In this way, SMEs are encouraged to provide services directly to the public sector, which is something that we are keen that they do.

Frameworks are of course created following a competition and they create a period of uncertainty on contractual terms, albeit they allow a closed list for contracts to be awarded, so it makes sense that they are for a limited duration—I think that is what the noble Lord was asking about. This should not lock out competitors for too long. Directly awarded contracts have a shorter duration for a different rationale: they allow contracting authorities to put alternative arrangements in place. That is the rationale, and we worry that the amendments put forward by the noble Lord, Lord Clement-Jones, would add more time as an unnecessary burden on contracting authorities by mandating them to check for and use available framework agreements, even where these might not be appropriate. Requiring them to keep within existing arrangements can actually stifle innovation and new entrants, particularly where the prototype in development ground is being used. The framework formalities, which may include a requirement for competitive process, may be impractical in cases such as those of extreme urgency.

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[Baroness Hayman of Ullock (Lab)]

Perhaps I might add that what the Minister said makes a lot of sense and is helpful, but one of the problems we have is that we do not know how effective it is going to be and whether it would work until we get into that situation again. Is there any ability to build in a review once the system has been tested, perhaps against a major public problem like we had with Covid-19?

[Baroness Neville-Rolfe (Con)]

I think our intention is to try to get rid of the VIP lanes. I will take the point away but there is a committee sitting—it will unfortunately sit for a long time, no doubt—that is looking at a lot of these important issues, and at some of these lessons. It is doing things in phases, so hopefully we will begin to get some output soon. We have had the Boardman review and, as the Committee can hear, we have tried in this Bill to learn from that and not to have a preferential system. The point about non-discrimination and such things is in the same spirit. I will take away the point about spirit and what we are doing here, but we have some good things in the Bill. I have listened to what the Committee has said but also tried to convince your Lordships about what we are trying to do.

I am advised that Clause 41 would prevent VIP lanes, as regulators will set out in advance what direct awards are permitted and Parliament would not approve anything too wide-ranging—I am sure that is true. The other point is that the Bill’s provisions on conflicts, which I am sure we will come on to debate further, also help against VIP lanes. We have quite a lot of things going on here; obviously, I am worried about piling it on. Everybody is concerned, so they all come in with different suggestions for trying to improve things. But if you pile those one on the other, you end up with rules that are too burdensome and do not work too well.

On the issue of a review, I think my noble friend Lady Noakes referred to some sort of review clause at an earlier juncture. “Review” is something that one tends to write into Bills where you have a problem. Perhaps we can discuss this further before Report to see whether a review is the right thing or whether enough is going on to try to ensure that we are in a good place on the Covid front. I respectfully request that the various amendments are withdrawn, and I would like to move the government amendments in my name.

[The Deputy Chairman of Committees (Baroness Fookes) (Con)]

My Lords, I remind the Committee that, where amendments are grouped, only the first amendment is moved. The others must be moved or not moved as they are reached on the Marshalled List.

[Lord Clement-Jones (LD)]

My Lords, it falls to me as the mover of the lead amendment to respond to the Minister. Clearly, there was quite a lot in what she said and we will need to brood over Hansard when the time comes because there are a large number of issues here. I recognise the Minister’s track record on SMEs but I am somewhat amazed that the Government have been commended on bringing greater clarity, as she put it, because our intention was to provide much greater clarity—and, indeed, equity—in all of this for SMEs. In terms of the addition of more time, burden and so on, I believe the Minister would normally think that we should go the extra mile for SMEs in these circumstances.

[Baroness Neville-Rolfe (Con)]

Certainly. We have discussed SMEs before; we have gone away to have a look at that issue. I recently held a round table with SMEs. Basically, they were positive about the Bill. Clearly, we have to see through and teach them about the new proposals. The basic point is that there are fewer different ways forward. I was quite surprised that that was the case but clearly there is complexity, and we have got to make sure that the Bill is in the right form.

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Moved by

[Baroness Neville-Rolfe]

237: Schedule 5, page 89, line 27, leave out paragraph 15

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Moved by

[Baroness Neville-Rolfe]

244: Clause 42, page 26, line 28, after “satisfy” insert “the contracting authority’s requirements or”

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[Lord Coaker (Lab)]

My Lords, we are getting into some detail now. That is the purpose of Committee and it is very constructive and informative. I very much agreed with the points made by the noble Lord, Lord Aberdare, about framework alliances and whether Clauses 44 to 47 include such alliances. If they do not, why not? The noble Lord’s point requires a simple answer: yes, they do, or no, they do not. He has asked an important question about the inclusion of framework alliances.

Similarly, I thought the points of the noble Lord, Lord Lansley, were really well made. Amendments 247, 248 and 249 have been put down specifically to ask the Minister whether the Government’s new subsection (3G) answers some of those points. That is the sort of detail we need to get into, as the cascade principle is really important. I think the noble Lord, Lord Scriven, also supported that.

I have a couple of specific points on the importance of transparency and openness, which we are all striving for. The noble Lord, Lord Fox, asked the Minister about what “value for money” means; that could almost be taken as a trick remark but it is crucial, as these sorts of definitions are really important. Therefore, can the Minister say what “proportionate” means in government Amendment 246? One person’s “proportionate” would be to allow people to get through without proper checks. However, without “proportionate”, the burden on some businesses and suppliers would be completely unacceptable—just too much and unrealistic. It would be helpful for the Committee to understand the use of “proportionate” in new subsections (3A) and (3D) and “may not” in new subsection (3C).

Government Amendment 246 talks about proportionate means of ensuring that suppliers have the relevant

“qualifications, experience or technical ability”

to perform a contract. It would be helpful if the Minister said a bit more about what that means.

More generally, since we are discussing Clauses 44 to 47, can the Minister explain why so many respondents to the Government’s consultation opposed open frameworks? Some 27% of the respondents did so. Is that a high negative response? I am not sure whether it is high or low, but it struck me as quite a lot. The Government did not agree with that view and ploughed on with Clause 47.

On Clause 45(3), can the Minister explain what sort of reasons there could be for a framework to exceed the normal eight years for a defence and security contract and four years for other frameworks? The Government seem to believe there might be a necessity to clarify that through their own Amendment 251, which seeks to clarify some of that but also reflects a concern about the number of years that could apply to a contract. That would be helpful.

Our limited discussion on the use of frameworks has been very important; it has sought to get into some of the details, which are what mean they do or do not work well—sometimes on the basis of what a particular word means. Like many noble Lords, I read the assessment in preparing for this Committee; you can see the point the noble Lord, Lord Fox, made in our earlier debate about a cry for clarity on what the Government are seeking to achieve. What different words mean is crucial. Building on the noble Lord’s plea to know what “value for money” means, a little more about what “proportionate”, et cetera, means in the context of government Amendment 246 would be helpful. The Minister may need a little more time to reflect on that but, if you are seeking a contract under a framework, the word “proportionate” will mean everything—or nothing. It would be very helpful if the Minister could clarify that.

With that, I think the Government have taken some very important steps forward under these clauses.

[Baroness Neville-Rolfe (Con)]

My Lords, I thank the noble Lords, Lord Aberdare and Lord Scriven, and my noble friend Lord Lansley, for their kind words.

I will start with the government amendments, because even though this will not be in strict order, it will help to answer the other points that have been raised. Frameworks are a well-established commercial purchasing tool, used widely across the public sector. Having looked at some of the public responses, that percentage figure that was quoted is not worrying. Key is whether this is a sensible provision and whether we are reforming them in the correct way. The Bill makes a number of improvements to the effectiveness of frameworks, to increase flexibility, provide value for money, et cetera.

I am glad that the noble Lord referred to government Amendment 246 because it is quite a substantial and important amendment among the hundreds that I apologise for having tabled in Committee. It allows contracting authorities to set conditions of participation in a competitive selection process for the award of a contract under a framework. New subsections (3A) to (3F) impose restrictions on the use of such conditions to those which apply to conditions of participation in a competitive tendering procedure under Clause 21. These include limiting the conditions in various ways, for example, to those which are a proportionate means of ensuring that suppliers have the relevant qualifications, experience and technical ability to perform the contract, of ensuring that the conditions do not break the rules on technical specifications, and of requiring that equivalents must be allowed where particular qualifications are required. The question on proportionality is a good one. I do not have as good an answer for the noble Lord as I would like, so I will write to him on that point.

My noble friend Lord Lansley commended new subsection (3G). This restricts the basis on which proposals received as part of a competitive selection process under a framework can be assessed to all or some of the award criteria against which tenders the frameworks were assessed. This is to ensure that suppliers that have already been admitted to a framework do not have to meet entirely different criteria later. New subsection (3H) allows for the award criteria to be refined.

Government Amendments 251 to 255, and 258 to 260, relate to rules for frameworks for the future award of contracts. The remaining government amendments in this group deal variously with light-touch contracts, ensuring open frameworks work as intended, and with minor tidying-up changes.

Turning to the noble Lord, Lord Aberdare, the thing that we worked on together when I was last a Minister is still unresolved, so I feel a sense of guilt.

[Lord Aberdare (CB)]

The Minister did make some progress though.

[Baroness Neville-Rolfe (Con)]

I agree with the objective behind the noble Lord’s Amendment 245A. There is a need for this Bill to ensure that multiple contracting authorities may join to award a framework. Frameworks can result in significant savings, financially and in time, and they say that time is money. This is particularly the case where they are put in place for the benefit of more than one contracting authority, for example by centralised procurement authorities.

To that end, Clause 10 provides for contracting authorities to carry out procurements jointly and for centralised procurement authorities to put in place arrangements for the benefit of other contracting authorities. This enables them to delegate their obligations to run lawful procurements to centralised procurement authorities, in their capacity as specialists, or to jointly procure with them and remain responsible, together with their procurement partners, for the award of any resulting contract. The noble Lord will wish to look carefully at that, but I do not think that his amendment is necessary.

Amendments 247 and 248, tabled by my noble friend Lord Lansley, seek to add additional requirements for the award of contracts under frameworks, without a further competitive process. The first of these, a system based on the suppliers’ ranking in the competition for the award of the framework—the noble Lord talked of a cascade; we have talked of ranking—is certainly one mechanism by which contracts can be awarded under a framework without a competition. However, this is only one selection mechanism, and there are others. They might include a “taxi rank” system, where the next supplier on the list gets the work, or the supplier chosen could simply be the cheapest for that good or service, which contracting authorities might consider to be more appropriate for their requirements on that occasion. There is nothing in the Bill preventing contracting authorities from including rankings in a framework, but there is no need to require this for all frameworks.

The second requirement is to allow for the provision of additional information by suppliers in order to make an award without a competition. In this connection, I draw noble Lords’ attention to Clause 44(6), which allows contracting authorities to ask for additional information to ensure that call off competitions are effective. Sorry, that is a bit repetitive. This seems preferable to receiving large amounts of potentially unnecessary or irrelevant information and adding burdens to the award process, which we are all keen to avoid.

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Moved by

[Baroness Neville-Rolfe]

246: Clause 44, page 27, line 18, at end insert—
“(3A) A competitive selection process may provide for conditions of participation only if the contracting authority is satisfied that the conditions are a proportionate means of ensuring that suppliers party to the framework have—(a) the legal and financial capacity to perform the contract, or(b) the technical ability to perform the contract. (3B) In this section, a “condition of participation” means a condition that a supplier must satisfy in order to be awarded a public contract in accordance with the framework.(3C) A condition set under subsection (3A)(b) may relate to suppliers’ qualifications, experience or technical ability, but may not—(a) require suppliers to have been awarded a contract under the framework or by a particular contracting authority,(b) break the rules on technical specifications in section 24, or(c) require particular qualifications without allowing for their equivalents.(3D) When considering whether a condition is proportionate for the purposes of subsection (3A), a contracting authority must have regard to the nature, complexity and cost of the public contract.(3E) A condition of participation may require the provision of evidence that is verifiable by a person other than the supplier.(3F) If a supplier does not satisfy a condition of participation, the contracting authority may exclude the supplier from participating in, or progressing as part of, the competitive selection process.(3G) A competitive selection process may provide for the assessment of proposals, but only by reference to one or more of the award criteria against which tenders were assessed in awarding the framework.(3H) The award criteria may be refined for the purposes of subsection (3G).”

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Moved by

[Baroness Neville-Rolfe]

250: Clause 44, page 28, line 6, leave out “under an open framework (see section 47)”

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Moved by

[Baroness Neville-Rolfe]

252: Clause 45, page 28, line 24, leave out “a framework awarded”

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Moved by

[Baroness Neville-Rolfe]

256: Clause 46, page 28, line 42, leave out “supplier” and insert “person”

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Moved by

[Baroness Neville-Rolfe]

258: Clause 47, page 29, line 12, at end insert “(but see subsection (2A))”

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Moved by

[Baroness Neville-Rolfe]

261: Clause 48, page 30, line 10, after “competitive” insert “tendering”

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Moved by

[Baroness Neville-Rolfe]

263: Clause 49, page 30, line 31, after second “the” insert “contract”

[Baroness Neville-Rolfe]

My Lords, this group deals with Parts 9 and 10 of the Bill. Providing suppliers with an effective remedy is not only required by the World Trade Organization’s Agreement on Government Procurement, the GPA—a very important international agreement—but a critical aspect to any well-functioning and accountable procurement regime. It gives the market confidence to invest resources participating in government procurement, knowing that public contracts will be awarded fairly and transparently.

As such, in most cases, suppliers have 30 days from the point at which a breach should have been discovered to raise a claim, and in the majority of procurements a standstill period will apply. The standstill period of eight working days is a short pause between the point when the contract award decision is notified to bidders and the final contract conclusion. It allows bidders to consider the assessment summary, which includes evaluation feedback.

If a claim is filed at court during the standstill period, an automatic suspension will apply, preventing signature of the contract until the legal claim is resolved or the suspension is lifted on application of the contracting authority. If the standstill passes without challenge, it protects against the contract being set aside after it goes live. Clearly, we do not want court proceedings to be the only way to motivate contracting authorities’ compliance with the new Act, which is why we have introduced the procurement oversight regime in Part 10, which will enable an appropriate authority to investigate non-compliance, make recommendations and issue guidance across all contracting authorities, as a result of the investigations. This will encourage the consistency and continuous improvement we all want to see.

Government Amendments 263 and 266 correct the reference to the contract award notice in Clause 49(1)(b) and (4) respectively.

Amendments 265, 267, 393 and 394 make it clear that any time a contracting authority chooses to enter into a standstill period, which is known as a voluntary standstill period in circumstances where the Bill does not mandate a standstill period, it must match the mandatory standstill period and be for a minimum of eight working days.

Amendment 461 clarifies that failure to have regard to the national or Welsh procurement policy statements is not enforceable via Part 9.

Amendments 464 to 469 make some textual amendments and make it clear that the automatic suspension applies only when a claim has been notified during the standstill period.

The structure and drafting of Clause 95 will be amended by Amendments 470 to 476 to make the intent of the clause easier to interpret.

There are various amendments related to oversight functions. Amendment 481 to Clause 96 makes a straightforward clarification to the meaning of “section 97 recommendation”. Amendments 483 and 484 reflect the principle that an appropriate authority may issue guidance to contracting authorities only in line with restrictions on relevant authorities in Clauses 99 to 101. Amendments 501 and 502 amend Clause 101 to reflect agreements with devolved authorities that, where appropriate, UK government Ministers can issue guidance under Clause 98 to all contracting authorities, including devolved and transferred authorities, to maximise joint working and efficiency.

I pause at this point so that my noble friend Lady Noakes and others can speak to their amendments.

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[Lord Coaker (Lab)]

My Lords, this has been another interesting debate. This group is on oversight and remedies. If you are going to have something worth legislating for, it has to have some sort of oversight and remedy. In other words, you have to see whether you are achieving what you wanted to and, if not, know what you going to do about it. It is therefore an important section, but to do that you have to have the right fundamentals in the Bill to have oversight and remedy.

I agree with my noble friend Lady Thornton’s amendment. She has been consistent throughout this Committee in trying to ensure that the Bill reflects the importance of social value. The noble Lord, Lord Scriven, supported that in his remarks. I know my noble friend will continue to argue for it, and we will support her should she wish to take it further on Report. It is really important, and I thank her for that.

As we are coming to the end of our remarks, I shall say that I agree with the point made by the noble Lord, Lord Fox, on Amendment 353A, tabled by the noble Lord, Lord Wallace, on what has happened to the procurement review unit. It was in a Green Paper and it seemed to be universally applauded—except, obviously, somewhere in government, so it was struck out. It would be interesting to know why it was struck out. Everybody supported it, except the Government, so why were they wrong and the Government right? Sometimes I find it baffling to understand why something is done. A procurement review unit seems essential to review what you are seeking to achieve. It is not a weakness but a strength. Those are my remarks about that.

I have to say this openly to the Committee: I am devastated that I did not notice the amendment from the noble Baroness, Lady Noakes: Amendment 477. Honestly, it is absolutely brilliant. The noble Lord, Lord True, has been promoted for being a socialist in charge of the Bill; the noble Baroness, Lady Neville-Rolfe, is on her way; and now we have this from the noble Baroness, Lady Noakes. Clause 96 is quite astonishing. I reread it to make sure; when I read it before, it completely passed me by. I will read it out, because people will not understand if they read Hansard without also reading this. Clause 96(1) says:

“An appropriate authority may investigate a relevant contracting authority’s compliance with requirements of this Act.”


So, we have a really important government Bill that will become law, and then, in subsection (5):

“In this section—‘procurement investigation’ means an investigation under subsection (1)”—


which I have just read out—

“‘relevant contracting authority’ means a contracting authority”,

as the noble Baroness, Lady Noakes, points out,

“other than … a Minister of the Crown or a government department”

and various others. Why would the Government set up something that is desperately important—in other words, a procurement unit—which makes purchases of hundreds of billions of pounds, but their own Bill says they will not investigate them?

Amendment 477 is brilliant and, as I say, I am devastated that I did not think of it or notice it. Fair play—I am very fair. More seriously, the amendment points out something that fundamentally seems to be a flaw in the way the Bill is drafted. Otherwise, there must be some incredible explanation or reason that I cannot think of—I do not know if anyone else on the Committee can think of any.

To finish, oversight and remedies are an extremely important part of any Bill, because that is how you ensure that what you seek to achieve is achieved and that you are held accountable. The amendments seek to answer those questions. Unless the Minister is able to respond in a way that persuades us, I think there are certainly one or two issues that we must come back to. With that I will sit down. It is a brilliant amendment, honestly.

[Baroness Neville-Rolfe (Con)]

I thank noble Lords for an interesting debate on these non-government amendments. I do not think that I have a perfect reply to my noble friend Lady Noakes’s three questions. We are due to meet to discuss various aspects of the Bill and I would like to explore her questions further, and then perhaps I can write to the Committee when it is clear to me what the right replies to those questions are.

I will attempt to comment on the amendment that the noble Lord, Lord Coaker, has just talked about, on why government departments do not have the same obligation to have regard to recommendations under Clause 97. It is a simple question, and our response is that it is not necessary to include government departments in Clause 96 and 97, because the appropriate authorities have sufficient influence over contracting authorities to ensure that any recommendations that result from an investigation are duly taken into consideration. To confirm, investigations, findings and progress reports may be published by the relevant authority acting as a further incentive. It is simply unnecessary to provide statutory powers in respect of government departments, whereas due to the different relationship with non-central contracting authorities, statutory powers were required to ensure appropriate engagements for these purposes. As noble Lords will know, we have quite a well-developed procurement operation now, right at the heart of Government, sitting in the Cabinet Office, which I think is an improvement. That is why it is not provided for in the Bill.

Just before I leave voluntary standstills, let me say that I will make sure we come back properly on the exchange we had earlier. We want to maintain voluntary standstills for dynamic markets—they are intended to be quick to use, agile and efficient, as we heard from my noble friend Lord Lansley—and for light-touch contracts, which are often for time-sensitive services such as the provision of health and social care. We do not want to make the light-touch contract rules stricter in this regard than current legislation, as we think that could lead to some problems.

Amendments 349A, 349B and 353A were tabled by the noble Lord, Lord Wallace of Saltaire, and others. They seek to legislate for the procurement review unit with a new clause. The procurement review unit, which is very important, is not specifically referenced in the Bill as it will be exercising statutory and non-statutory powers on behalf of Ministers. The proposed new clauses would therefore conflict with existing provisions. Furthermore, considering the importance and potential implications of the decisions the PRU will support the Minister of the day in making—the proper statutory process—we believe it would be inappropriate to delegate that ultimate responsibility to unelected officials below ministerial level.

The PRU will work on behalf of the Minister of the day in two key areas. The first area is debarments. Clauses 56 to 61 set out the process for the establishment of a debarment list of excluded and excludable suppliers; this has already been debated. Under these clauses, it is envisaged that the PRU will investigate whether a supplier is subject to an exclusion ground and whether the issues in question are likely to arise again. The PRU will issue advice to the relevant Minister, usually the Minister for the Cabinet Office, who will take the final decision whether to add the supplier to the debarment list.

The second area is improving compliance with the Bill. Clauses 96 to 98 provide the framework and statutory powers required for carrying out procurement oversight. The PRU will exercise these oversight functions on behalf of the Minister and make proposals regarding any investigations, recommendations and statutory guidance it considers appropriate for the Minister’s ultimate approval.

[Lord Fox (LD)]

My Lords—

[Baroness Neville-Rolfe (Con)]

I will have a little more to say about this later on, so why not let me finish? If I do not answer the noble Lord’s questions, we will try to get at what is needed.

Amendments 477 to 480 seek to examine why government departments have been excluded from the appropriate authority’s investigatory powers. The definition of “relevant contracting authority” in Clause 96 is in recognition of existing governance. Ministers already have the authority to investigate government departments without the need for statutory powers; I think I have said that already. There are also established routes for co-operation with investigations.

Amendment 477A was tabled by the noble Baronesses, Lady Thornton—it is good to see her in the Committee—Lady Hayman of Ullock and Lady Bennett of Manor Castle, and the noble Earl, Lord Devon. Amendment 482 was tabled by the noble Baroness, Lady Noakes. These amendments would expand the scope of the statutory oversight powers beyond compliance with the Bill, straying into areas of policy. The scope of the statutory powers provided by these clauses has been carefully drafted to maintain the boundary between law, which must be adhered to, and policy, where some leeway is allowed in terms of its implementation.

Expanding Clause 96 and/or the Section 97 recommendations to include social value, as well as considering how contracting authorities have chosen to meet obligations to have regard to policy and principles, would blur that boundary and start to erode the autonomy of contracting authorities, which we recognise are best placed to make policy implementation decisions that are appropriate for their business. It would also move the statutory regime away from objective and measurable concerns into more subjective areas of debate, which could impact the effectiveness of the oversight system. We believe that the scope of Clauses 96 to 98 creates a proportionate, effective and compelling incentive for improvement. It is worth noting, however, that the drafting of Clauses 96 and 97 does not prevent the Minister from making observations regarding a contracting authority’s policy implementation. Policy guidance can indeed continue to be provided to contracting authorities.

Non-statutory procurement policy notes, which we have discussed before, are currently released to guide contracting authorities. In the new regime, under Clause 98, statutory guidance, which may be published as a result of investigations, can also address matters of policy. Contracting authorities will be required to have regard to any guidance released under Clause 98; I think this helps to deal with the social value issue. The removal of Clause 97(3) would result in the appropriate authority having the power to intervene in specific procurements.

The restriction in Clause 97(3)(c) ensures probity of the procurement by, for example, preventing a Minister of the Crown from using Section 97 to exert influence over which supplier is awarded the contract. That is an important point. To remove this restriction would be concerning to contracting authorities and suppliers alike.

Finally in this group, the noble Baronesses, Lady Thornton and Lady Hayman, and the noble Lord, Lord Coaker, tabled Amendment 486A. This seeks to stipulate that the expertise of SMEs, voluntary organisations and social enterprises is accessible to an appropriate authority that is conducting investigations under Clause 96. The PRU will be managed and delivered by a small, experienced team of civil servants based in the Cabinet Office, supported by a panel of experts, which can be consulted regarding investigations and any resultant Section 97 recommendations and guidance under Section 98. The Cabinet Office aspires to provide perspectives from procurement experts from across the Civil Service, local authorities and various types of private organisations, including SMEs and VCSEs, to benefit the oversight regime.

However, it should be recognised that having a panel which includes external procurement professionals is dependent on the availability of suitably qualified individuals and the ability to manage any potential conflicts of interest. I am therefore unwilling to make a legislative commitment of the kind proposed. However, the establishment of the panel will be transparent, and appropriate documentation will be published in due course, including on the process for appointing members. It seems to me that this is an important error, which is why I make that point.

[Lord Purvis of Tweed (LD)]

Can the Minister clarify whether it is the Government’s intention that the PRU will be an appropriate authority, so that panel members themselves will have legal powers under Section 96? If not, I am really confused as to what legal powers the panel will have when it comes to calling for documents, and what duty will be on other contracting authorities to provide the panel with any information at all. At the moment, it does not look as if the panel is considered to be an appropriate authority, so it will not have any other legal powers under Part 10.

--- Later in debate ---

[Lord Scriven (LD)]

Following on from what the noble Baroness, Lady Thornton, has said, and from what the Minister said about how this could not be in the Bill because it is a policy initiative, the procurement objective in Clause 11(1)(b) is “maximising public benefit”, which is a policy issue. All the noble Baroness is trying to do is ensure that social value is looked at by the appropriate authorities. Actually, it is more defined and specific in law, because there is a social value Act but no public benefit Act. The Minister’s answer that it is just a policy issue really does not stack up.

[Baroness Neville-Rolfe (Con)]

We do have a social value Act; I think the answer is—subject to correction—that social value features in the NPPS, the policy guidance note, and that failure to have regard to the NPPS is challengeable via judicial review rather than by suppliers for breach of statutory duty under Part 9 of the Bill. That is more appropriate as the NPPS will inform procurement strategy, and failure to comply should not result in suppliers being able to seek compensation from the public purse in respect of an individual procurement. There is quite a lot of complication in that area, but that is the approach. There is a social value Act, but obviously I will listen to what has been said today.

To return to the PRU, the unit will exercise powers on behalf of an appropriate authority. The panel will consult the PRU when appropriate and, if the Government set up a panel, as Governments often do—we have various panels in different departments that I have been involved with, and in my experience they tend to endure; certainly this one will be useful—the PRU will make recommendations to the Minister, who is the appropriate authority and will make the final decisions. That seems to be the right approach constitutionally.

[Lord Purvis of Tweed (LD)]

I am grateful for that response. To be clear, will the panel be the investigating body?

[Baroness Neville-Rolfe (Con)]

No. The PRU, a Civil Service unit, will be the investigating body, which will consist of experienced people of the right kind. The panel will advise that body.

[Lord Purvis of Tweed (LD)]

I am grateful, but Clause 96 says the “appropriate authority may investigate”. The Minister has been referring in this short debate to “investigations” with regard to the panel. I am grateful that she has clarified that it will simply be an advisory group, not an investigatory group, and will not itself have the legal powers to seek documents. I am therefore not entirely sure what the PRU will do other than what existing civil servants do, which is to advise Ministers.

[Baroness Neville-Rolfe (Con)]

We have put together this whole new system of procurement, which includes various checks and balances. Panel members will be available for the procurement review unit to help regarding investigations and the unit’s work. Their reports and recommendations will help with moving forward on procurement and the complexities of this change of the law. Their advice can be published, and we will be able to reference the assistance that the panel has provided. That is the approach that we are proposing following a process of consultation. The PRU is central. I am sure we will revert to this issue.

[Lord Fox (LD)]

The Minister will have got the message that there is deep disquiet about how this will be structured and will operate. If the Minister has time, can she reflect on Hansard and write a letter before Report setting out how this unit will be set up and what its roles, on a statutory or non-statutory basis, will be? That would be very helpful.

[Baroness Neville-Rolfe (Con)]

Of course, I will write setting out how this will work. I ask the Committee to look at it constructively in the light of what we are trying to achieve across a very wide area of procurement. I go back to where we started in Committee, as this is probably the final amendment this evening, and say that there is also a process of cultural change, training and so on that will be going on, which is an important complement to the investigatory powers that we are looking at in this amendment.

I respectfully ask noble Lords not to move their amendments.

Amendment 263 agreed.

--- Later in debate ---

Moved by

[Baroness Neville-Rolfe]

265: Clause 49, page 31, line 2, after “period” insert “(a “voluntary standstill period”)”

House of Lords: Appointments

Baroness Neville-Rolfe Excerpts

Monday 17th October 2022 Lords Chamber

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

My Lords, the Government have no plans to change the status of the House of Lords Appointments Commission, which should continue to play its very important advisory role. Appointments to the House of Lords are a matter for the Prime Minister, and it is for the Prime Minister of the day to advise the sovereign on appointments to the Lords. The list issued on Friday was made by the Prime Minister on the advice of the former Prime Minister, Boris Johnson.

[Lord Fowler (CB)]

My Lords, that is a disappointing reply. Does the Minister remember that the all-party committee which I set up when I was Lord Speaker in 2016, under the noble Lord, Lord Burns, proposed a maximum for the House of Lords of 600 Members? The latest list brings the total not to 600 but to 825, with resignation honours still to come. Also, on this occasion, the system has enabled the appointment of a new Peer who had quite falsely attacked a distinguished Member of this House as a paedophile. Surely there is no reason why an individual who made such an untrue allegation should be rewarded by a peerage. Is not the truth that the present appointments system cries out for urgent reform?

[Baroness Neville-Rolfe (Con)]

I start by making the general point that, given retirements and other departures, some new Members are essential to keep the expertise and outlook of the House of Lords fresh. The Burns report had longer-term proposals to maintain a steady-state size. Those still require further thought and engagement, particularly with the House of Commons, given the constitutional implications. Theresa May’s Administration in 2018 did not sign up to the Burns recommendations, but there is a Conservative manifesto commitment to look at the role of the Lords.

On the other point that my noble friend Lord Fowler raised—if I may still call him my noble friend—the nomination for the appointment of the individual he referred to is a matter for the leader of the Labour Party, Keir Starmer, to answer for. Obviously the HOLAC provides advice on nominations for all life Peers, including those recommended by UK political parties, to ensure the highest standards of propriety. That was applied in the usual way.

[Baroness Smith of Basildon (Lab)]

My Lords, listening to the Minister, we accept that the appointment of new Members is important to refresh skills, talents and expertise as others depart from your Lordships’ House. However, the Burns report, as indicated by the noble Lord, Lord Fowler, showed a road map towards a smaller and therefore more effective Chamber.

Let us look at the facts over the last few years. David Cameron appointed more Peers per year than any other Prime Minister ever, with a far greater proportion to the government parties. Boris Johnson then made him look like an amateur. There have been so many resignations from the Government Front Bench in the last two years that, even with the higher number of Conservative appointments, we have had an extra 10 appointments on the Conservative Benches purely to fill ministerial posts following resignations.

Your Lordships’ House has regularly expressed its concern and its support for the Burns report. This must be the first time ever that the House of Lords has called for reform and it is the Government who are blocking it. With the talk of another list about to be sent our way, courtesy of the former Prime Minister’s resignation list—I do not know if there will be any further ones—is it not time to stop, pause and have a genuine discussion about a sensible way forward?

[Baroness Neville-Rolfe (Con)]

On the last point, it is a long-standing convention that individuals can be nominated for an honour in recognition of their public or political service and Prime Ministers can draw up resignation lists after leaving office. This has been the case under past Governments across the political spectrum. I point out regarding the numbers that, after a long period of Labour government, there were very substantial numbers of Labour Peers. The Conservative voice in this House is still underrepresented and has been for some time.

[Noble Lords]

Oh!

[Baroness Neville-Rolfe (Con)]

We try our best to represent this side of the House—politely—but the Conservative Party has been the largest party in the 2010, 2015, 2017 and 2019 parliamentary general elections. In the 2019 general election, the Conservatives won 56% of seats, yet, as of August 2022, the Conservative Party still had only 33% of the seats in the Lords. There were 249 Conservatives out of 757 Peers. Noble Lords opposite may not like these numbers, but they are a reality, and they need to understand the position.

[Lord Lamont of Lerwick (Con)]

My Lords, this House rightfully dislikes personal attacks. However, on the question of Tom Watson, I say that he did not just attack a Member of this House under parliamentary privilege; he also destroyed the lives of Harvey Proctor, who lost his house and his job, Lord Bramall, who died under suspicion of a completely false charge, and Lord Brittan, who I saw in his dying days and who was deeply depressed by these completely false accusations against him. While this nomination was from the leader of the Opposition, very surprisingly, I regret that it was not vetoed by the Prime Minister. This appointment is a stain on the House and an absolute disgrace.

[Baroness Neville-Rolfe (Con)]

I thank my noble friend for drawing those points to the attention of the House. In respect of today’s Question, I say that the commission’s role was to provide advice, and this was duly provided in the usual way. However, we have heard what my noble friend had to say.

[Lord Kakkar (CB)]

My Lords, I draw the House’s attention to my previous role as a past chairman of the House of Lords Appointments Commission. It is the responsibility of the individual party leaders to assess the suitability of their individual nominations to serve in your Lordships’ House. Does the Minister believe that the adoption of common criteria to make that assessment of suitability might achieve a greater degree of consistency and confidence in those nominations?

[Baroness Neville-Rolfe (Con)]

My Lords, as I said, the commission is an independent advisory committee, and the Government consider its advice carefully in whatever form it is given. The Prime Minister is democratically accountable and must have the final say on appointments. Of course, we are all due to debate my noble friend Lord Norton’s Private Member’s Bill, and while the Government have reservations about it, we welcome that opportunity.

[Lord Wallace of Saltaire (LD)]

My Lords, my recollection of the negotiations between 1997 and 1999 is that there was a general agreement that there should not be a majority for any group in this House and that this House should have a different composition from the House of Commons. I understood the Minister to be arguing that this House should have the same composition as the House of Commons. In the not unlikely event that a different Government appear after the next election, how does the Minister suggest her preference for how a majority for the new Government should be achieved? Should there be a voluntary retirement of, say, 60 or 70 Conservatives, or should there be the appointment of enough additional Members to give the new Government their majority, resulting in a steady increase in the number within the House?

[Baroness Neville-Rolfe (Con)]

I explained the situation about the 33% share that troubled us on this side of the House. The noble Lord’s other question is highly speculative. In addition, one can look back at the past as to what changes must be made when Governments change; I have already referred to that. We must now make sure that we are refreshing the House with new people right across the House. There are opposition and government Peers on the list; I welcome that and look forward to working with the new Peers.

[Lord Grocott (Lab)]

The Minister should have had rather more statistics at her disposal when she was briefed for this Question, particularly on the balance between government and opposition Peers. I remind her that, in the 13 years of Labour Government, the biggest gap was that the Labour Government had 26 more Peers than the official Conservative Opposition. I will not go through the list of years, but I can certainly tell her that the Tories had more Peers than the Labour Party during most of the years of the last Labour Government. The current gap between this Government and the Opposition is that there are 83 more government Members than there are opposition Members. The Government still manage to lose a lot of votes, by the way, but that is not down to numbers. It is high time that the Appointments Commission saw, as part of its remit, the need to examine the effect of each list as it comes along on the balance of party strength in the House of Lords, because this Government, under successive Prime Ministers, have been abusing the appointments system.

[Baroness Neville-Rolfe (Con)]

My Lords, I always enjoy the lessons in history from the noble Lord, Lord Grocott, but I am a simple person and the simple fact is that former Prime Minister Tony Blair appointed 374 Peers to this House. That is reflected in many of the people on the Benches opposite who contribute to debates in this House.

[Baroness Browning (Con)]

My Lords, in December I shall complete five years on the House of Lords Appointments Commission, so I have dealt with some of the cases that have been raised today. I have to say to the House that we have struggled with some cases because our remit, as the House will be aware, has been to look only at propriety and not at suitability. My noble friend will be aware of the letter sent by our chair, the noble Lord, Lord Bew, to the leaders of both the Conservative Party and Labour Party only last week, suggesting that our remit should now include a test as to whether the candidate meets the seven Nolan principles. That would give us much more ability to make the most suitable of choices. Technically, every year we are allowed to appoint two Cross-Benchers, although we do not always meet those criteria, through no fault of our own. In recent years, when I have been involved in the selection of two Cross-Benchers, the standard and diligence with which we select people is much higher than for those coming forward on a prime ministerial list.

[Baroness Neville-Rolfe (Con)]

Obviously, I thank my noble friend for her service on the commission, which is very important. I remember that, before the commission was set up, a lot of questions were rightly asked if you had the honour of having a peerage conferred on you—in my case, by Her late Majesty the Queen. I repeat the point that individuals are nominated in recognition of their contribution to society and their public and political service. Peers are appointed to contribute further to public service, for example, and in this House it is right to have a variety of people coming forward. That helps us right across the House. I often have a number of battles with my good and noble friend Lady Jones in the Green Party—she and I joined on the same day—and I look forward to continuing to have a very diverse House.

[Baroness Hayman (CB)]

My Lords, the Minister did not address the point put so powerfully by the noble Baroness, Lady Browning. The Minister said earlier that all appointments went to the House of Lords Appointments Commission, which is absolutely correct, but the degree of scrutiny that the commission can give to nominees is grossly different between political recommendations and appointments to the Cross Benches. Does not she accept that not being able to scrutinise recommendations on whether the people recommended are, first, suitable and, secondly, committed to playing a part in the work of your Lordships’ House is one of the main obstacles to any sort of public trust in the system that we have at the moment?

[Baroness Neville-Rolfe (Con)]

It is a very good thing that we have the Appointments Commission. It is an independent advisory committee, which has been set up and does its job. As I said at the beginning of this small debate, I do not think that the time has come to change that arrangement. The Prime Minister is democratically accountable for appointments, and they should not be determined by an unelected body to a greater extent than they are.

Economy: The Growth Plan 2022

Baroness Neville-Rolfe Excerpts

Monday 10th October 2022 Lords Chamber

Moved by

[Baroness Neville-Rolfe]

That this House takes note of the economy and the Growth Plan 2022.

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

My Lords, I start by welcoming the noble Baroness, Lady Gohir, to today’s debate. I very much look forward to hearing her maiden speech and to her future contributions. On a sad note, we are also hearing the valedictory speech from the right reverend Prelate the Bishop of Birmingham, who has provided so many mature, sensible and considered contributions to the House over the past 12 years.

It is a great privilege to open the debate on the economy. When the new Prime Minister was forming her Administration, I was honoured to be offered the post of Minister of State in the Cabinet Office, in effect replacing my noble friend Lord True, now the Leader of the House. I take this opportunity to express my admiration for his brilliant eulogy to Her late Majesty. I was briefed that most Cabinet Office work was, in the main, worthy, so I anticipated a future dealing with the humdrum detail of government work—below the radar, as it were. In the event—it is sometimes surprising how things turn out—I first come before your Lordships to outline the Government’s economic growth plan.

As the Prime Minister has made abundantly clear, growth is the core economic mission of this Government. With economic growth, everyone benefits. We cannot have, say, a strong NHS, good schools or effective defence without it. We have three priorities: cutting taxes to boost growth, reforming the supply side of the economy and maintaining a responsible approach to the public finances.

I will come to the details of the plan shortly, but first I will touch briefly on another important recent development that is an integral part of our whole economic package: our action on energy bills. The Prime Minister rightly took action on this crisis facing households within 48 hours of taking office. The energy price guarantee will limit the unit price that consumers pay for electricity and gas, so that for the next two years the typical annual household bill will be £2,500, in contrast to the £6,000 or so that some predicted. Millions of the most vulnerable households will also receive additional payments.

We are also helping businesses. The energy bill relief scheme, providing an equivalent guarantee to that for households, will reduce gas and electricity prices for all UK businesses, charities and the public sector, especially schools and hospitals. Finally, to support the market, we have announced the energy markets financing scheme, providing a 100% guarantee for commercial banks to offer emergency liquidity to energy firms in otherwise sound financial health that face high margin calls.

While early estimates suggested that our package could have cost as much as £160 billion, more recent estimates are much lower. The key point is that we are giving relief and confidence to a large section of the British people, something that will particularly matter to those at the lower end of the scale. Significantly, the measures have been designed to provide an incentive for fuel economy. There is a reduction in cost per unit, not an overall cap, so that it encourages people and businesses to minimise their energy use. More importantly, without this package it would have been a very brutal winter for millions of households and small businesses.

Our growth plan sets out our vision for a simpler, lower-tax economy. This Government believe that high taxes reduce the incentive to work, encourage tax evasion, deter investment and hinder enterprise. Hence we are cutting the basic rate of income tax to 19p in April 2023—that is, one year early—which will benefit virtually all taxpayers.

Noble Lords will have heard that the abolition of the 45% band will no longer go ahead. The Prime Minister and Chancellor have accepted that it had become a distraction from our growth plan. I point out, however, that 40% was the top rate from the date of the Thatcher reforms and all through the Major, Blair, and most of the Brown eras. Also, the top rate is 40% in the Republic of Ireland and 39% in Norway.

International competitiveness must remain a vital objective, so next year’s planned increase in corporation tax will be cancelled. That means that the rate will remain at 19%, the lowest in the G20, enhancing the attractiveness of the UK as a place to do business. We are also confirming that the annual investment allowance will be set permanently at £1 million, and we have introduced legislation to cancel the health and social care levy. Reversing the levy delivers a tax cut for 28 million people, worth on average £330 every year, and a tax cut for nearly a million businesses.

Planned increases in the duty rates for beer, cider, wine and spirits will also be cancelled. In addition, we want to help families aspiring to buy a home of their own. We have therefore proposed a series of reductions in the thresholds for stamp duty land tax, which will assist buyers, particularly first-time buyers.

Simplification is close to my heart. We are embedding tax simplification into the institutions of government and repealing recent changes to off-payroll working rules—the infamous IR35—which added complexity and cost for many businesses that engage contractors. I know that this will be particularly welcome to our Economic Affairs Committee.

We are introducing a VAT-free shopping scheme. We want our high streets, airports, ports and shopping centres to feel the economic benefit of the millions of tourists who visit our wonderful country each year. While the Government believe in lowering taxes wherever possible, achieving growth will take more than that. With more vacancies than unemployed people to fill them, we need to encourage people to join the labour market—getting more people into work by, for example, incentivising those claiming universal credit to secure more or better-paid work. We will also legislate to ensure that strikes can be called only once negotiations have genuinely broken down.

To drive growth, we need new sources of capital investment. We want to unlock billions of pounds to help British businesses—for example, in developing new technologies that can scale up. Hence we will reform the pensions cap and launch the long-term investment for technology and science fund.

We need global banks to create jobs here, invest here and pay their taxes here in London, not in Paris or New York, so we are scrapping the cap on bankers’ bonuses. To reaffirm the UK’s status as the world’s financial services centre, we will set out a package of regulatory reforms in the coming months.

We must also see our way to simplifying regulation and cutting red tape in key areas such as planning and procurement. The weight of complexity and compliance is absorbing precious resources and holding back productivity. I know from my time with the other noble Lords on our Built Environment Committee how important housing and infrastructure are to our growth and success. Sadly, our planning system for major infrastructure is too slow and fragmented. For that reason, we are accelerating infrastructure delivery in energy, road, rail and gigabit-capable broadband, with new legislation that will unpick the complex patchwork of planning restrictions and EU-derived laws that constrain our growth, and we are getting the housing market moving by promoting the disposal of surplus public sector land for housing.

Finally, and of great significance across our country, we are creating a series of new investment zones. We will liberalise planning rules on agreed sites, releasing land and accelerating development. We are introducing an unprecedented set of tax and national insurance incentives for business to invest, build and create jobs in these zones.

The steps that the Government are taking add up to a radical and concerted effort to boost growth. In the coming months we will continue to work to bring forward further measures, with announcements on agriculture, business regulation, childcare, immigration and digital infrastructure.

Crucially, the Government understand that growth and sustainable finances must go hand in hand. I remind noble Lords that in 2021 the UK had the second lowest debt-to-GDP ratio of any G7 country, lower than Japan, Italy, France, Canada and the US. Even so, only continued fiscal discipline will provide the confidence and stability to underpin long-term growth.

Accordingly, as announced this morning, on 31 October —three weeks from now—the Chancellor will publish a medium-term fiscal plan setting out our responsible fiscal approach and how we plan to reduce debt as a percentage of GDP over the medium term. Further, he has asked the OBR to set out a full economic and fiscal forecast soon, and he continues to work closely with the Governor of the Bank of England.

In conclusion, I passionately want—we all want—our country to succeed and to live up to our past achievements. To achieve that, economic success is essential. To that end, we must get the economy growing again. We must do so while still dealing with the effects of the Covid pandemic and its impact on our public services. We are also rightly engaged in giving significant help to Ukraine—obviously at a cost. Success will not be easy.

Today we are here to listen to views from across the House and look forward to engaging in a constructive debate—but, however one looks at matters, achieving economic growth is vital if we are to achieve our ambitions. We need to do things differently and better. That is what the growth plan is all about.