Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Gascoigne Excerpts

Committee stage
Tuesday 14th May 2024 Lords Chamber

The Government have accepted that the LGPS has fiduciary-like duties. The source of reference for that is their response to the Law Commission, which said that that was the case; their view on the Financial Markets Law Committee; and the fact that their own statutory guidance to the Local Government Pension Scheme on ESG and stewardship more or less mirrors what you would put to a trustee with fiduciary duties. We are in the ballpark where there is broad acceptance, even though it is a statutory-based scheme, that the standards under which it operates are fiduciary-like. That is the point: if they are fiduciary-like, the trustees have to exercise a certain discretion or consideration in relation to the decisions that they have to make. I am arguing that those who would be involved in decision-making need the security of knowing that there is no ambiguity around financial risk and impact being considered—

[Lord Gascoigne (Con)]

I ask the noble Baroness to be brief.

[Baroness Drake (Lab)]

I will say my last sentence.

[Lord Collins of Highbury (Lab)]

The rules say “normally brief” but I think the Committee would like to hear from my noble friend on this important issue.

[Lord Gascoigne (Con)]

With respect, I am not stopping the noble Baroness; I am just asking her to be brief.

[Baroness Drake (Lab)]

I will accept the constraint.

Finally, I take the point about lawyers having been involved in drafting this. I do not mean to be rude but in the area of investment and pension decisions, the road is littered with government-cleared legislation and regulation that has ended up being problematic or challenged in the courts and having to be revisited. I do not think we can rely wholly on that argument.

I think my amendment is being overblown. It is very clear that there is a problem, and that those engaged in this decision-making feel that there is a problem. The Government are opening up areas of legal uncertainty. We can nail it with a couple of words. I beg leave to withdraw the amendment.