Trade Bill

Lord Fox Excerpts

Committee stage & Committee: 2nd sitting (Hansard) & Committee: 2nd sitting (Hansard): House of Lords
Thursday 1st October 2020 Grand Committee

[Lord Patel (CB) [V]]

My Lords, I am pleased to support Amendment 51, in the name of the noble Baroness, Lady Thornton, to which I have added my name. I also look forward to the comments of my friends, the noble Baroness, Lady Noakes, and the noble Lord, Lord Lansley. Under normal Committee circumstances, we would have enjoyed debating some of these amendments.

In my view, this is the most important amendment for our highly valued NHS. Any trade deal that allows someone to own and manage or have access to any patient data, in no matter how small a way, is a threat to our NHS. The greatest perceived or real threat is from a trade deal with the USA that includes any part of the NHS. Our health service is free at the point of need; the USA healthcare system, on the other hand, is based on ability to pay. That in itself defines what the motives will be for any USA organisation wanting to get involved in any aspects of our NHS.

The Government repeatedly say that our NHS will not be on the table and that it is not for sale. What does that mean? The Government and NHS England already allow private contractors to bid for health services. Recent examples are Deloitte and Serco, for Covid-19-related services. Tennessee-based Acadia runs nearly a third of mental health beds, and the Priory Group has won many NHS contracts. Centene, a subsidiary of Centene Corporation, a tech and logistic provider, works with many GP practices. Palantir, an American data-mining company, is contracted to track, model, and analyse data from Covid-19. Optum, a subsidiary of the giant US health provider UnitedHealth, has contracts with many CCGs.

It is said that the citizens of the UK are not bothered who provides the service, as long as it is free when they need it, but they will if the taxes have to go up, services become poor and they have to pay for extras. While our health service is not perfect in every way, we get a bigger bang for our buck, despite being one of the least funded of OECD countries. Commercial companies may not wish or be allowed directly to run clinical services, but may be interested in managing the services. NHS England is moving to integrated care services, devising systems to be able to run such services. American companies such as UnitedHealth and other IPOs may well be interested in running regional services, with a contract that allows them to keep any surplus as profits. They could do that only by cutting services, particularly in secondary care.

The jewels in the crown of our NHS are information and data. A national health service that in the near future will be completely digitised is a goldmine of data, estimated to be worth well over £10 billion a year —data that is a goldmine for developing artificial intelligence, robotics and so on. No one in the world has such a database. Add to this the genomics data that UK has for both patients and population that is unique in the world makes the NHS highly attractive for developing and testing of personalised medicines. Digitised patient information is of immense value for doing clinical trials with stratified patients. There is no other country in the world that can so quickly identify patient groups required for such trials, as demonstrated recently in a clinical trial of a US-manufactured drug, conducted with speed and lower cost, mostly in the United Kingdom. It is this kind of information that makes our NHS is so valuable; any pharma, biotech, medical devices or diagnostic company would be mad not to want to get its hands on it.

The Government have said that they would welcome companies to come and help innovate. That is an invitation. The unicorn companies we wish the UK to develop will become a reality, but the UK will not be the owners. Of course, it could all be for good, except that it will be profit driven. Why is it that USA has the most expensive healthcare system in the world and delivers one of the worst outcomes in health? The big pharma companies say that we pay too little for our medicines, as already mentioned, through our regulatory system and medicines reimbursement regime. While I accept that NICE methodologies need a review, pharma would want much more than that in any UK-USA trade deal. I declare an interest here: in October 1997, I submitted a paper developed by the Academy of Medical Royal Colleges to establish a national institute of clinical effectiveness, which became the NICE of today, to the then Minister of Health in the Lords, the noble Baroness, Lady Jay of Paddington. So I may have some right to comment on the methodologies of NICE.

As the noble Baroness, Lady Sheehan, said, even when medicines patents run out, US pharma would seek data exclusivity to prevent cheaper drugs being produced. For all those reasons, why would any country negotiating a trade deal not wish to have any aspects of our NHS to be part of it, particularly the USA? To be able to get a share of delivery of service, manage or procure for any part of NHS is a profitable prize in itself; to be able to get hold of even a part of the health and patient data, with the possibility of owning it, is a prize measured in billions of dollars.

The only way to keep our NHS in our hands is to rule out any possibility of it being included in any trade documents maybe through mechanisms of positive listing or legislation in the Bill. I hope that the noble Baroness, Lady Thornton, will be committed to do this at Report. I look forward to the Minister’s comments.

[Lord Fox (LD)]

It is a great pleasure to follow the noble Lord, Lord Patel. I shall speak to Amendment 51, to which I am a signatory. Before I do that, I commend my noble friend Lady Sheehan, who spoke eloquently on her Amendment 75, one part of which was about the dangers of price gouging. She mentioned a number of different ploys, as did the noble Lord, Lord Patel. But there is another one, whereby companies gain control of the generic and the replacement for the generic, then seek to phase out the generic. That has been happening recently. Perhaps the Minister can explain how, in trading terms, we can combat that kind of behaviour.

The dangers of ISDS, which were set out by my noble friend Lady Sheehan and the noble Lord, Lord Bassam, are real and present. I look forward to the Minister’s response to their speeches on that issue.

Amendment 51 is designed to protect the NHS from potential dangers. If we are setting out on the great ship of global trade, it may be a lifebelt. The noble Baroness, Lady Thornton, is right that this Bill is the only game in town for Parliament to exert its views, and this issue is of real concern to many Members of both Houses. That is why we are right to be having this discussion today.

The noble Lord, Lord Patel, was brilliant and devastating as he described the threats to our health service—threats that it is already facing. He described how we are on the brink of serious dangers, which the amendment highlights and seeks to avoid. The stakes are high, as the noble Lord, Lord Purvis, set out when speaking to an earlier group of amendments. The NHS is a huge potential market for any national economy with which we might wish to conclude a trade deal, not least, of course, the United States of America. However, we should acknowledge that it is also clear that the UK is in a position to continue to benefit substantially from the right relationship with international medical service and pharmaceutical companies, and we have to get that balance right between closing and opening our borders.

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[Lord Sheikh (Con) [V]]

My Lords, I apologise because I did not unmute myself, but I think that Lady Sheikh has managed to unmute me.

I support Amendment 34 in the name of the noble Baroness, Lady Kidron. While the internet is a space for innovation, expression and communication, it can also be damaging. As our digital world develops and innovates, so do the risks of online harm. Children are increasingly exposed to inappropriate content, grooming, harassment, malicious behaviour, misinformation and breaches of privacy. Two-thirds of vulnerable children and young people, supported by Barnardo’s sexual exploitation service, were groomed online before meeting their abuser in person.

Social media companies have failed to prioritise children’s safety. Last year, the NSPCC found that more than 70% of reported grooming took place on the main social media networks—Facebook, Instagram, WhatsApp and Snapchat. The global platforms are not taking enough responsibility for content on their sites, or being held accountable. More needs to be done to verify user identities, monitor harmful content and handle reports of abuse effectively. Harmful content and activities have a damaging effect on children’s mental and physical well-being and can lead to exploitation, trafficking, substance abuse and radicalisation. Those impacts are rarely short term; they stay with the children for the rest of their lives.

The UK is committed to being the safest place in the world to be online, and we must do more. We need better safeguards, and I urge the Government to prioritise the online harms Bill, which will be world leading in safety requirements and holding the industry accountable. As we leave the European Union and continue to develop our place in the digital world, we must ensure that our standards and goals are not jeopardised. We recently signed a trade deal with Japan; this historic agreement will advance digital standards through data provisions that maintain and improve digital safety. This year, Japan was ranked first in the child online safety index for low cyber risks. Those risks refer to bullying, misuse of technology, the detrimental effect of gaming and social media, and exposure to violent and sexual content.

In the UK-Japan trade deal, the rights and protection of children online have not been undermined, as Japan shares a similar ambition to ours for legislative standards. But what will happen when we look to sign with other countries that do not have the same level of protection? Unlike Japan, the United States came 22nd out of 30 countries in the child online safety index for cyber risks.

Although this is only one aspect of the index, it shows that children are particularly at risk online in the United States. We cannot expose our children to the same abuse. The new trade agreement between the US, Mexico and Canada has created a legal shield for tech companies, whereby the service providers are not held liable for content on their platforms or the harm it may cause to users. This fails to hold social media companies to account, and is not an effective safeguard for children.

Supporting the amendment would mean that our existing protections could not be traded away, and would ensure that we could fulfil our duty of care to children. If we do not support the amendment, we risk undermining our commitment to create a safer world online for the protection of children. Furthermore, if we do not do this, we could cause a situation in which social media giants are not transparent in how they deal with abuse online, and may be less accountable.

The pandemic has reinforced the importance of the digital world in our lives. When we return to normality, we must have better safeguards. We should not just maintain our existing safeguards; we should endeavour to strengthen them. The amendment would mean at least that our existing laws, and therefore the rights of our children, were protected. I hope that it will be accepted.

[Lord Fox (LD)]

My Lords, in responding to the last group of amendments, the Minster, the noble Lord, Lord Grimstone, expressed surprise at the broad nature of the debate. I would say to him, perhaps facetiously, “Welcome to the House of Lords”. I fear that this group may tempt his colleague, the noble Viscount, Lord Younger, to make a similar observation, but I ask that he does not. As the noble Baroness, Lady Thornton, said at the end of the previous debate, the nature of these debates highlights serious concerns that noble Lords have, and the Government should take them seriously, even when they are not necessarily on the face of the Bill.

This is a very good example of that. I shall not speak in detail about Amendment 34, because the noble Baroness, Lady Kidron, made a very powerful speech. I am also glad that Lady Sheikh managed to get the noble Lord, Lord Sheikh, online, because he made a very strident contribution on something that is extremely important.

Similarly, I am not going to talk much about intellectual property. On this issue I bend the knee to my noble friend Lord Clement-Jones—and, frankly, so should Her Majesty’s Government. I suggest that the Minister should give my noble friend’s words, and particularly his questions, special attention, because they are serious and important issues that face a lot of companies in this country.

The noble Baroness, Lady Neville-Rolfe, spoke strongly on data flow. At the risk of provoking the ire of my noble friend Lord Clement-Jones, I have to say that I agree with her. Her issue is absolutely fundamental—and I shall expand a bit on that.

I have previously quoted the “exuberant” Secretary of State, as the noble Baroness, Lady Neville-Rolfe, describes her. Here is another quote, from a speech she made to the WTO almost exactly a year ago:

“We believe it is high time to reform digital trade rules so that they are fit for the 21st century, reducing restrictions to market access to support e-commerce and ensure the free flow of data across borders.”


Yet despite this enthusiasm or exuberance, I sense that there are problems when it comes to squaring the conflicting pressures that are mounting around the free flow of data across borders. Indeed, when the Minister kindly invited myself and others to a facilitated discussion on the progress of the US-UK trade deal, I was surprised and shocked by the insouciant response to my question on data adequacy and the issue of reconciling US and EU data rules. It was a very short answer, and to us, it did not show a full understanding of the challenge.

However, it is not just about GDPR. I will talk in a little detail about Schrems II, which my noble friend Lord Clement-Jones raised, because it is an important cloud hanging over what we seek to achieve. To remind your Lordships, in that ruling the European Court of Justice, the highest court of the EU, found on the adequacy of the protection provided by the EU-US data protection shield. To explain, it wrote in its press release that

“the requirements of US national security, public interest and law enforcement have primacy, thus condoning interference with the fundamental rights of persons whose data are transferred to that third country.”

It added that

“mechanisms in the EU-US Privacy Shield ostensibly intended to mitigate this interference are not up the required legal standard of ‘essential equivalence’ with EU law.”

Broadly, the US’s prioritization of digital surveillance in the view of the court collides directly with European fundamental rights.

That is a sobering ruling, which spells danger for UK trade aspirations and sets some alarm bells ringing regarding the UK’s surveillance regime. Her Majesty’s Government need to reflect on this very seriously when talking up the potential for a UK-US trade deal that includes data, and they should contrast that stark ruling with the freebooting statement from the Secretary of State with which I opened. By the way, I assume that Her Majesty’s Government are probably having to reflect on this ruling in their efforts to tie down data adequacy with the EU when the transition period runs out. Perhaps the Minister can use this opportunity to update us on progress with these discussions with the EU.

This is not a trivial issue, and we need to demonstrate in this country that we take it seriously. As a starting point, accepting Amendments 15, 16 and 34 would be a very good idea.

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords, I will be relatively brief because much of what I want to say has been covered by the other speakers, not that I could ever have competed with the tour d’horizon that was the speech by the noble Lord, Lord Clement-Jones, and the expertise also shown by the former Minister, the noble Baroness, Lady Neville-Rolfe. It was also a bit of a tour de force, since it touched on every issue there is to touch on in terms of intellectual property. Indeed, if the noble Lords were minded to follow that up with amendments to back up some of the points they were making, the glacial progress we are making so far on the Bill would turn into a complete and utter standstill. So much is going on here, and so many things need to be addressed, that I am almost tempted to go into cahoots with them to try to see whether we can pick them out. Perhaps I will resist that one.

Both Amendments 15 and 16, taken together or separately, are helpful in the sense that, as others have said, they pick up some of the rather considerable concerns that we are all hearing from the IP sector about the future, about what is going to happen to personal data flows and, indeed, about what is going to happen to our IP industry, which is so vital to the UK economy and our cultural industries. They seem to be very sensible information-gathering amendments that do not impose any great burden on the Government, and they would help to inform the situation as we reach the turning points at the end of this year. I hope that they commend themselves at least in outline to the Minister.

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[The Deputy Chairman of Committees (Lord Haskel) (Lab)]

My Lords, I have had two requests to speak after the Minister from the noble Lords, Lord Fox and Lord Stevenson. I now call the noble Lord, Lord Fox.

[Lord Fox (LD)]

I thank the Minister for his response on Schrems II, which was very helpful. I would like just one further detail. Can he confirm that the advice, when it comes, could concern where databases are domiciled? If so, the advice needs to be made available earlier rather than later so that companies are able to comply. Therefore, can he give some indication of the timetable for when business might get some guidelines so that they can work out their new data management policy?

[Viscount Younger of Leckie (Con)]

Absolutely. That is a very fair question from the noble Lord. As he will expect, I do not have a timeline, so the best thing for me to do is to look at his question and write to him, giving whatever information we have from the department, together with any extra information that might be helpful to him.