Telecommunications (Security) Bill

Lord Coaker Excerpts

Committee stage
Tuesday 13th July 2021 Grand Committee

[Lord Fox (LD)]

This is an interesting debate—one that we started about a year ago. During the summer, on the then Telecommunications Infrastructure (Leasehold Property) Bill, many of these arguments were rehearsed. This Bill was held out, in a sense, as the carrot that would address these issues, and it has been some time coming.

To some extent, the initial issues that came up last year have been discounted, with the Government largely moving on the Huawei issue. However, as we have heard—and will hear over the course of Committee—many questions are unanswered. We should once again thank the noble Lords, Lord Alton and Lord Blencathra, and my noble friend Lady Northover for bringing forward these amendments, as well as the noble Lord, Lord Coaker. I will be interested to hear his perspective as, having been a Minister, he understands some of the trade-offs in decision-making—it is interesting that he chose to sign this amendment none the less.

I thank the noble Lord, Lord Naseby, for his Second Reading speech. He could not give it to us at Second Reading, so we got it anyway. There are some issues around industrial capacity which I will come back to.

The noble Earl, Lord Erroll, picked up a point on which I queried the Minister and did not get a response: at what point are we examining this technology? You have systems, sub-systems, components and software. Frankly, if we are doing this, it must be done at all levels. The capacity to do that and track a chip, a piece of software or something in the software which we do not even know is supposed to be there is a huge task. Do we have the capacity in the intelligence services, and the industrial ability, to do it? It is a very important question, as there is not much point having this if we cannot actually do it.

Before speaking to Amendments 1 and 20, I will say a few words on Amendment 27, the Five Eyes element. As we know, this requires the Secretary of State to review the UK’s security arrangements with companies banned by Five Eyes partners and to decide whether to take similar action on the UK’s arrangements with those companies. As I think my noble friend Lady Northover said, the Minister will no doubt say that we do this anyway. If we do this anyway then, to some extent, we should not be afraid of putting it in the Bill. It is important that we walk in as lock-step a way as we can with our Five Eyes partners, but the point of the noble Earl, Lord Erroll, is apposite; China understands that and will play the Five Eyes against each other. We must be aware of that; we must not be slavish in how we respond but canny, and work with our partners so that they understand why we are moving in the right direction.

Again, this comes down to capacity. The noble Lord, Lord Naseby, asked who does it. The NCSC is supposed to provide the ammunition for the Secretary of State and Ofcom to operate on. There are big questions around the interface between the NCSC and Ofcom and how they relate to each other. How, for example, does the highly secret information the NCSC is dealing with get to DCMS and Ofcom without either breaching security or eroding transparency, or both? We have big concerns about that, and obviously it will come up later.

The noble Lord, Lord Alton, raised Newport Wafer Fab, which until recently I thought was an ice cream firm somewhere in Aberystwyth. However, now I find that, as he set out, it is our only supplier of this equipment. That is an object lesson in itself but it is also completely appropriate to this point. In its response, BEIS confuses manufacturing capacity with technical novelty and has the idea that, because this is not technically novel, that somehow stops it from being valuable to this country. However, manufacturing capacity is central to the delivery of future technical novelty, and if you want somewhere to look, look at the communications industry. We were pre-eminent global leading companies in analogue communications technology; no country could match us. We lost that manufacturing capacity and the ability to innovate in the digital space, and that is why we have the supply chain issues we have today. If the Government have not learned this lesson, and it seems that BEIS has not, we have a long way to travel yet before we get to a sensible place.

In a sense we have heard from the noble Lord, Lord Alton, and others about specific issues but I would like to rise up a bit and look at the bigger picture slightly. In his Mansion House speech on 1 July 2021, Rishi Sunak crystallises the challenge and perhaps the dichotomy, and points us in a number of different directions at the same time. Your Lordships must excuse me, but I will read out a fairly lengthy passage which is appropriate to this debate. He says:

“And our principles will also guide our relationship with China. Too often, the debate on China lacks nuance. Some people on both sides argue either that we should sever all ties or focus solely on commercial opportunities at the expense of our values. Neither position adequately reflects the reality of our relationship with a vast, complex country, with a long history. The truth is, China is both one of the most important economies in the world and a state with fundamentally different values to ours. We need a mature and balanced relationship. That means being eyes wide open about their increasing international influence and continuing to take a principled stand on issues we judge to contravene our values. After all, principles only matter if they extend beyond our convenience. But it also means recognising the links between our people and businesses; cooperating on global issues like health, aging, climate and biodiversity; and”—


here we come to the rub—

“realising the potential of a fast-growing financial services market with total assets worth £40 trillion”.

What does a mature, balanced relationship look like in context? How nuanced are the examples that we have just heard about the Chinese? First, we can see that because of advanced concerns around the security of at least one Chinese vendor, the UK Government are mandating equipment to be torn out of our existing infrastructure and thrown away at the cost of several billion pounds. That is not a nuance. Secondly, we have heard from the noble Lord, Lord Alton, this time and previously, and we have seen the evidence of malevolence within China to its own people on a scale that is, let us say, unusual even for the age in which we live. Thirdly, we can see transparently what is going on in Hong Kong. That in itself is not a nuance either. Fourthly, we have the Chancellor’s stated desire to realise the potential of a fast-growing financial services market.

All this is the context in which Amendments 1 and 20 have been tabled. This gives the chance for the Minister to explain where she and the Bill sit on that nuanced scale, as the Chancellor puts it. He clearly sets out that the Government’s principles will guide our relationship with China, so what are those principles?

[Lord Coaker (Lab)]

My Lords, this is my first Grand Committee appearance, and I hope that I do not disappoint the noble Lord, Lord Fox. I have been in a number of committees, but not at this end of the building. I am still getting used to some of the processes and procedures, but I am very pleased to be speaking on this Bill.

From our perspective, the Bill is very welcome. The Government are clearly addressing a very real security concern that our nation has, and, in trying to deal with it, have not just my support but that of every single Member of the House of Lords. It is our country, and we want it looked after and defended properly. Many of the amendments and the comments that have been made so far today, and which will be made throughout the Committee and no doubt at Report and beyond, are about challenging the Government, not from an oppositional point of view but from one of trying to improve the legislation. We want to ask the Government testing questions to see where their thinking is. That is what all the various speakers have done so far today.

There are a number of particular issues. As others have said, the amendments in this group, from the noble Lord, Lord Alton, deal with the international context for the security of the telecommunications sector, however you define that. This is really important, because it affects—not infects—every single part of our lives. The noble Lord, Lord Alton, gave the example of Hikvision and CCTV. Whether it is the hardware or the software, this demonstrates that there are examples of new technology and telecommunications which impact on all our lives but which many of us probably do not view as causing a potential security threat to our country and nation. We have only to look at where that is going—whether you look at this sphere or the defence sphere—to know that we are going to see an increase in telecommunications, and in the use of space, drones, artificial intelligence and all those sorts of aspects.

One thing that I will talk about in other debates on other amendments is how you future-proof this—and that is part of some of the later amendments. Hikvision, which the noble Lord, Lord Alton, raised, is an interesting instance. At the nub of it is that, if our allies, who we depend on for our collective security, are banning companies such as Hikvision, as in the United States, how is it in our interests to defend our own security to not do the same? It is unfair to say that it has not been thought about, but there is something of a disjointed approach when one of our closest allies—if not our closest—has banned a tech company that we use. I am sure that there are very good reasons for it, and the Civil Service and others will no doubt tell the Minister X, Y and Z, but it defies common sense. Whatever the reality of it, it just does not appear to be a sensible option, so I very much support the example that the noble Lord, Lord Alton, gave. That is one of the reasons why I added my name to Amendment 27.

With regard to NATO and Five Eyes on a domestic and international level—I shall return to this point on Amendments 18 and 25—who actually holds the ring? Who is the person or what is the department that co-ordinates all this activity across government? Who holds the ring across government? You could say that it is the Prime Minister, but the Minister will know what I mean. Out of all the various aspects of government, who actually in the end decides? And if there is a conflict of interest between them, who then is the judge of that and how does that work on an international level? But as I say, that is more to do with Amendments 18 and 25.

Amendment 27 in particular, as I said, ensures a review of telecoms companies when a Five Eyes partner bans the operation of a vendor of goods or services to public telecommunications providers in its country on security grounds. That is eminently sensible. It a review. The amendment is, essentially, testing the Government by asking, “Why wouldn’t you have a review?” Why would you not—to use a security term—keep that under surveillance?

--- Later in debate ---

[Lord Fox (LD)]

My Lords, in response to the noble Earl, Lord Erroll, I say that it is also a huge issue when you have, essentially, a near-monopolistic private sector supplier, which makes any decision completely catastrophic for the under-bidder. I am speaking not to that but to Amendments 2, 3, 4, 5 and 6, which, as my noble friend Lord Clement-Jones pointed out, bear my name. He set out a very clear rationale for these amendments, which back up the concerns of the Constitution Committee and, indeed, some suppliers. Rather than reiterate those, I beg noble Lords’ indulgence to illustrate the point, inviting them to join me in a thought experiment. They need not worry—it is not going to hurt and I will not be pushing them into a Petri dish or anything like that. I simply ask your Lordships to imagine things the other way around: imagine that the Telecommunications (Security) Bill did indeed include the words currently proposed by my noble friend Lord Clement-Jones and myself, words that clearly identify that the focus of the Bill should be on the security of telecoms.

I ask noble Lords to continue to use their imagination that it was my noble friend and I who were proposing changes to include the words that are currently there; in other words, imagine that we were proposing to take the word “security” from this imaginary Bill and turn it into “anything”. Broadening the cover, as we have heard, would broaden the problem around any interruption very widely. I do not know but I dare say that, if we tried to do that, the Public Bill Office would have something to say, pointing to the Long Title of the Bill, which is:

“To make provision about the security of public electronic communications networks and public electronic communications services”


—in other words, security. Were we to try to take that word out and put in “anything”, I dare say the PBO would not allow us to do so.

If we did however slip it past the PBO, I guarantee that the Minister of the day would tell us that this would subvert the Bill’s intention and would take away the Bill’s focus from security to some of the imaginary things that the noble Lord opposite suggested—or, indeed, a digger backing into a green box somewhere in Kent. This is not the “Telecoms (Mishaps) Bill” but the Telecommunications (Security) Bill. These simple and modest amendments focus the Bill on its stated objective.

[Lord Coaker (Lab)]

This is a really important discussion. I do not want to speak for too long but the noble Earl, Lord Erroll, was right to say that the Bill is about security and not just “anything”. None of us on the Committee wants to compromise the nation’s security or compromise the ability of our military personnel to conduct necessary operations. However, sometimes in legislation words really matter—they are the law of the land. That is why scrutiny of legislation in Committee like this is so important, word by word and line by line, otherwise—and I will have a series of questions for the Minister on this—down the line in one, two, three or five years, something will happen and everybody will go, “How was the word ‘anything’ included?” The unintended consequence of legislation is something that we need to consider, or people will ask how something happened—how that word was allowed.

With that in mind, it is important that the Minister explains to the Committee how this definition is arrived at. The starting point would be to ask her to explain the differences between having the word “anything” and having the phrase “security issue”. Can she give examples of how the Bill would be weakened by having that term rather than “anything”, and what “anything” means—apart from saying that it means “anything”? What does it actually mean, given that the Bill is supposed to be about security issues, as the noble Earl said?

The Government argue that the duty on providers is appropriate and proportionate to ensure that the effects of compromise are limited and to act to remedy the impacts. I understand why Ministers are keen to keep the definition wide, but on its own it is not good enough. For example, can the Minister explain whether there are any thresholds to what amounts to a security compromise, or is it “anything”, and what does that mean to an individual who might stray into territory that they are not sure about? How was the Bill’s definition arrived at? Who came up with it and what advice did they receive? Were alternatives suggested to it, what did security experts say to the Minister was necessary, and were there dissenting voices?

In seeking clarification, I wonder whether the Minister can explain why the definition does not include, as I understand it, the presence of supply chain components, as the noble Lord, Lord Fox, mentioned on the earlier group of amendments, if they represent a security threat. Maybe it does—but could the Minister clarify that? We need to know that to understand the diversification of the supply chain and how effectively or not it is proceeding. It is important to consider the components of the supply chain, particularly when identifying where they are a threat to our national security. As I see it, that is not included in Clause 1, but perhaps the Minister can tell me that it is and that I have not read the clause correctly. If so, where is it?

I go back to where I started. These amendments are important in testing how the Government have arrived at this use of “anything”. I know it sounds like semantics —what does “anything” mean?—but the point made by the noble Earl, Lord Erroll, is crucial. The Bill is a security Bill. That being so, why does “anything” appear and why is “security issue” not the appropriate way to describe this? Why is it not included in the Bill? It is necessary for the Committee to understand the Government’s thinking on this for us to consider whether we need to bring back this matter on Report.

[Baroness Barran (Con)]

My Lords, the Committee will recall that the UK Telecoms Supply Chain Review Report in July 2019 found that telecoms providers lack incentives to apply security best practice. This Bill is our response to its recommendations and takes forward the Government’s commitment in the report to introduce a new security framework, including new legal duties and requirements, to ensure that telecoms providers operate secure and resilient networks and services.

I thank the noble Lords, Lord Fox and Lord Clement-Jones, for tabling these amendments to Clause 1. Before I address them directly, I hope that it will be helpful if I set out some brief context for the clause as it appears in the Bill and try to address the challenges posed by the noble Lord, Lord Coaker.

Clause 1 inserts a new Section 105A into the Communications Act 2003. New Section 105A places a duty on public telecoms providers, first, to identify the risks of security compromises; secondly, to reduce the risks of compromises occurring; and, thirdly, to prepare for the occurrence of security compromises. To support the duty, new Section 105A creates a new definition of “security compromise”. The definition is purposefully broad and includes anything that compromises the availability, performance or functionality of a network or service, or that compromises the confidentiality of the signals conveyed by it. I thank my noble friend Lord Naseby for his support for this approach.

I am genuinely slightly puzzled by the remarks of the noble Lord, Lord Coaker, about what is included and excluded, because Clause 1 goes into great detail—which I shall not read out now, but I know the noble Lord has looked at it. Not only do we define what is included in “compromise” but we are explicit about what is excluded. This comprehensive approach will help ensure that telecoms providers protect their networks and services properly in the future. It creates a new duty on providers to take steps to reduce the risk of incidents and attacks seen globally in recent years.

As we have heard, the amendments tabled by the noble Lords, Lord Fox and Lord Clement-Jones, would narrow the definition of a security compromise. As both noble Lords noted, this was also a matter that the Constitution Committee recommended the House consider in its recent report. As I have said, the definition is designed to support a long-term approach to security. It aims to be focused enough to address risks that are specific to telecoms networks. At the same time, it is broad enough to ensure the Bill is future-proof and has flexibility to enable us to address new and evolving threats.

I appreciate that the noble Lords are seeking to ensure that legal obligations on telecoms providers are targeted and appropriate to specific risks, but it is important to remember that the framework within the Bill is designed to do exactly that. Certainly, we are not aiming, in the words of the noble Earl, to bash suppliers over the head. Rather, the broad definition in the Bill helps future-proof the legislation, whereas the specific security measures which narrow that focus will be set out in secondary legislation. I tried to get my head around the thought experiment from the noble Lord, Lord Fox, but I got stuck at the idea of trying to fit inside a petri dish, which would definitely be impossible.