Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Collins of Highbury Excerpts

Committee stage
Wednesday 17th April 2024 Lords Chamber

[Baroness Neville-Rolfe (Con)]

My Lords, as I set out in my response to the previous group, the Government chose to apply the ban to public authorities as defined by Section 6 of the Human Rights Act 1998. It is a great advantage that your Lordships, perhaps in contrast to the other place, scrutinise Bills in this way. I cannot accept that it is a sloppy Bill—it is a good Bill—but I think that concerns have been overstated. My noble friend Lady Noakes just explained why, very eloquently. We need clarity. Most bodies know whether or not they are covered.

There is another good reason for using the Human Rights Act definition—obviously, I am happy to look further at its implications, as I have said—which is that the Government intended to apply the Bill to a broad range of bodies when they are exercising public functions. This was to ensure a consistent approach to foreign policy across the UK’s public institutions, to stop public bodies legitimising divisive campaigns, which can undermine community cohesion, and to allow public bodies to focus on their core purpose when engaging in procurement and investment. That was the intention of the manifesto commitment that I mentioned in the previous group.

These amendments seek, rightly, to probe the scope of the Bill’s definition of public authorities, but they also probe the need for the power to make exceptions to the ban. I will try to address each in turn.

I am very glad that the right reverend Prelate the Bishop of Manchester has joined the debate. The Church of England would be in the Bill’s scope only to the extent that it exercises public functions. We have heard a little about the interpretation of that in the courts.

Before I address the specific amendments, I remind the Committee that the Bill will not create any new criminal offences. That is a very important point. I also take this opportunity to address the point raised by the noble Lord, Lord Boateng, and the noble Baroness, Lady Chapman, which was picked up by my noble friend Lord Deben, on orchestras. Orchestras are very unlikely to be regarded as public authorities. Moreover, withdrawing from an event is unlikely to be regarded as a procurement decision for the purposes of our Bill. The definition of a procurement decision does not include contracts where it is the public authority providing the service.

I can also reassure the noble Baroness who raised the issue that defence contracts are also exempt from the Bill. In addition, for contracts in scope, the Bill already contains an exception to the ban for national security considerations. In practice, if a case is reported to an enforcement authority it will look at whether the public authority had regard to any of the exemptions to the Bill—for example, the national security exemptions —during the decision-making process. Evidence of this might include if the public authority shows that it was following guidance from the UK Government, or became aware, for example, that a supplier was engaged in espionage.

Amendments 26 and 23 probe whether charitable organisations would come under the Bill’s scope. Charities would be captured by the ban only if they were performing public functions. It is the Government’s understanding that most charities will not be covered by the Bill. I hope that provides reassurance to noble Lords.

[Lord Collins of Highbury (Lab)]

I am sorry to interrupt, but I was just checking the relevant parts of the Bill relating to enforcement. The Minister said that no new criminal actions arise from the Bill. What we do have is the ability of the Secretary of State to have enforcement powers that include monetary penalties. If people refuse to pay the monetary penalties, what would that result in?

[Baroness Neville-Rolfe (Con)]

Perhaps I might continue on the points raised in the debate and come back to that point. It is a very reasonable question but I am not going to answer it without advice. However, there are no criminal sanctions in this Bill, which there often are in the Bills we consider in this House.

There may be a small number of cases where charities are delivering public functions; they would therefore be captured in respect of those functions. However, it is important to note that it does not mean that a charity is a public authority just because it is in receipt of public funding.

The Bill will not apply to charities’ private functions. For example, for universities, decisions that are part and parcel of delivering higher education would be public functions so they would be in scope of the ban. If a charity did have public functions in scope of the ban, it would apply only to investment and procurement decisions made within the public functions. That is a point that I need to emphasise. Therefore, the ban would not restrict how such bodies decide, for example, to distribute humanitarian aid, which was the subject of the earlier debate.

--- Later in debate ---

[Baroness Neville-Rolfe (Con)]

I have already said that I am trying to answer the many questions noble Lords have asked. There have been a great many interventions on me and I have been very patient. I have also made some undertakings to try to clarify some of these points, including childcare, which would cover the schools that my noble friend Lord Deben mentioned.

Perhaps I could turn to Amendment 54, which requires

“the Secretary of State to provide a comprehensive list”,

of the bodies in scope

“before the provisions in Clause 1 can be brought into force”.

The Government are not able to provide a comprehensive list of bodies captured by the Human Rights Act definition. However, I have tried to be clear on the categories of bodies that includes. To repeat, these include: central government agencies and non-departmental public bodies; UK Government Ministers and devolved Ministers; local authorities; administering authorities of local government pension schemes; universities and higher education providers with public functions; publicly funded schools; and some museums and galleries in receipt of significant public funding.

As with any definition, there will be further cases at the margins where it is impossible to generalise without the full facts of a case. That, of course, is where the courts come in. Legislation often uses general definitions—for example, the Human Rights Act from which we have taken the scope or the scope of bodies covered by obligations under public procurement legislation.

Finally, I turn to Amendment 14A. This would remove from the Bill the powers granted to the Secretary of State to amend the schedule to make exceptions to the ban for certain bodies, functions and types of considerations, and to amend or remove regulations made under these powers. I understand concerns about the use of subordinate legislation—the noble Lord knows that—and we are lucky that we have such a good committee to supervise its use. However, these powers are necessary to ensure that the ban can evolve over time and operate as intended, for example in response to emerging global events.

I assure the noble Baroness, Lady Chapman, that the FCDO is fully supportive of this legislation, and all regulations made under this Bill would follow the normal procedure of cross-governmental clearance and, of course, be approved by the Foreign Secretary. In the event that in future the ban has unintended consequences for a certain public authority, it is right for the Secretary of State to have the power to exempt that body, or a function of the body, from the ban via statutory instrument—I think today’s debate shows that that is necessary—and this would be subject to affirmative resolution by both Houses.

These powers will also allow the Secretary of State to exempt certain types of considerations from the ban. For example, Ministers may decide to exempt a narrow type of consideration to ensure the ban can evolve in line with government policy. The powers future-proof the legislation to ensure the ban can continue to operate effectively and mitigate against any unforeseen circumstances.

Before I close, I should perhaps address the point made by the noble Lord, Lord Deben, on the environment. The ban applies only to decisions that target a particular country or territory. For example, environmental campaigns, including ones against fossil fuels that are not country specific, are outside the scope of this Bill. I also reassure my noble friend that the power in Clause 3 cannot be used to remove any exception to the ban in the Bill as passed by Parliament. There is a schedule the noble Lord can look at, which includes environmental misconduct, which we are coming on to discuss.

I hope, finally, to address the point raised by the noble Lord, Lord Davies of Brixton, with regard to why there is a separate clause in the Bill for local government pension schemes. The administering authorities for local government pension schemes are public authorities under Section 6 of the Human Rights Act. Capturing administering authorities of LGPS in a bespoke provision means that the Pensions Regulator can use its existing powers and procedures to enforce the BDS ban for the administering authorities of LGPS. That avoids the Pensions Regulator setting up a separate enforcement system for the Bill. I am happy to have a discussion with him; we often discuss pensions issues which are of limited interest sometimes to the whole House.

I hope that my response to this group of amendments —importantly, alongside the undertakings I gave in response to my previous group which we expanded a little to bring in telling examples—will help the Committee to understand why we have chosen the Human Rights Act definition and I ask the noble Lord to withdraw his amendment. I look forward to further discussion.

[Lord Collins of Highbury (Lab)]

I hope I am able to intervene at this point before the noble Baroness sits down—some of these new rules that have been introduced for Committee stage I find incredibly damaging to our ability to properly scrutinise this Bill; I raised that point at the committee.

The noble Baroness said that the FCDO fully supports this legislation. She may recall that, at the previous Committee day, I specifically raised this question because I wanted to inform the Committee of the precise nature of the FCDO’s advice following United Nations resolutions regarding the Occupied Territories, which are specifically mentioned in this Bill. Perhaps she can take this opportunity to tell us how that advice could potentially impact the sort of investment and procurement decisions that organisations might make. There is advice issued by the FCDO in relation to the Occupied Territories.

[Baroness Neville-Rolfe (Con)]

We are going to be discussing the Occupied Territories in a group two or three later in this Bill and I do not have an answer to the noble Lord on this point today, except to reiterate that this Bill has been collectively agreed. I was particularly talking about the arrangements for regulations which, in turn, had been collectively agreed. I explained the system that when you have a new statutory instrument, there is a write-round which involves all relevant Ministers. In this particular case, that would certainly include the Foreign Secretary.