Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Grocott Excerpts

2nd reading
Tuesday 20th February 2024 Lords Chamber

[Lord Grocott (Lab)]

My Lords, I agreed with so much of what the right reverend Prelate has just said and I apologise if I repeat some of the points he made. My remarks about the Bill will focus entirely on Clause 3(7) and specifically on the Occupied Territories. I shall argue that these provisions in the Bill are contrary to UN Security Council Resolution 2334, as mentioned earlier. I shall argue that the clause perversely gives the illegally Occupied Territories special protection under UK law. I shall also say that the clause undermines British foreign policy, both in respect of the illegality of the occupation and the pursuit of a two-state solution.

On the UN resolution, the clause fails because it gives equal status, with no differentiation between Israel on the one hand and the Occupied Palestinian Territories on the other. Resolution 2334, endorsed by Britain and passed in 2016 by 14 votes to nil, with one abstention, could not be clearer. The resolution:

“Calls upon all States … to distinguish, in their relevant dealings, between the territory of the State of Israel and the territories occupied since 1967”.


As my honourable friend Wayne David said, speaking for the Opposition in the Commons, the Bill

“gives special protection to goods and services from both Israel and the Occupied Palestinian Territories. Moreover, it gives greater protection to illegal settlements in the OPT than it does to any other state in the world except Israel”.—[Official Report, 12/9/23; col. 132.]

That brings me to the point about UK law. It is surely perverse in the extreme to afford special protected status to Israeli settlements that UK Governments of both parties—not to mention the UN resolution—have repeatedly stated to be part of an illegal occupation. How can the Government on the one hand condemn the continued expansion of the settlements while on the other be passing a law that has the potential to help the settlements become more established and prosperous?

Indeed, it is worse than that, because the Government’s justification for the Bill is that it is not appropriate for public authorities to impose their own boycotts and sanctions, except where to do so is positively consistent with UK foreign policy. Well, what could be more positively consistent with UK foreign policy than refusing to indulge in economic activity that might help and sustain the illegal settlements? Sadly, this Bill, by giving special status to the Occupied Territories, goes one step further towards normalising the occupation, thereby making the two-state solution, which has been the consistent policy of UK Governments of all parties for decades, even more difficult to achieve.

Even before the horrors of the war in Gaza, the political prospect of achieving a two-state solution was getting ever more problematic. In April 2017 the International Relations Committee of this House published a report on the Middle East, which had this to say:

“On its current trajectory, the Israeli-Palestinian dispute is on the verge of moving into a phase where the two-state solution becomes an impossibility and is considered no longer viable by either side. The consequences would be grave for the region … If Israel continues to reduce the possibilities of a two-state solution, the UK should be ready to support UNSC resolutions condemning those actions in no uncertain terms. The Government should give serious consideration to now recognising Palestine as a state”.


I agreed with every word of that when I was on the committee seven years ago. I believe that its prognoses and forebodings are utterly relevant today.

There is another serious impediment to the two- state solution that it would be folly to ignore. We have long been aware that the Israeli Government under Mr Netanyahu has been pursuing a policy of settlement expansion, which makes the possibility of a two-state solution much more difficult to achieve. On 21 January this year, he made this policy explicit when he confirmed that he is a total opposition to an independent Palestinian state. He said:

“I will not compromise on full Israeli security control over the entire area west of the Jordan—and that is contrary to a Palestinian state”.


What a time this is to be debating a Bill which fails to distinguish between Israel and the Occupied Territories. It gives me no pleasure at all to say that this seems to be more in line with Mr Netanyahu’s policy than it is with UK foreign policy.

That is perhaps a big part of the problem with Clause 3(7). The truth is that this Bill from the Department of Levelling Up, Housing and Communities has one clause in it that deals with a deeply sensitive part of British foreign policy. Much of my speech has unashamedly been about British foreign policy. If we are to end in law the distinction between Israel and the Occupied Territories, we surely need to hear the views of the Foreign Office.

For obvious reasons, the Foreign Secretary has been intensely involved in the Middle East since his appointment. Earlier this year he said that Britain was ready to bring forward the moment when it formally recognises a Palestinian state. He went on to say that the Palestinian people would have to be shown “irreversible progress” towards a two-state solution. The Foreign Secretary in my view is absolutely right, and that makes me wonder what the Foreign Office thinks of this clause in the Bill. I have been around long enough to know that the Minister is unlikely to reveal anything about this in her wind-up, but to present a Bill to Parliament that includes a clause with reference to one of the most dangerous and tragic parts of the world is at best insensitive and at worst very damaging. I hope that the Government, even at this stage, will think again.