Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Hain Excerpts

2nd reading
Tuesday 20th February 2024 Lords Chamber

[Lord Hain (Lab)]

My Lords, this is another pernicious piece of legislation attacking the freedom to protest against injustice and oppression except when the Government approve. It is therefore a Bill of which Vladimir Putin would be proud as it prevents public authorities, such as local councils, local government pension funds or universities, making their own ethical choices about their spending or investment. I am sorry that this Conservative Party is on the wrong side of history, as indeed it was over the fight against the most institutionalised system of racism the world has ever seen, namely apartheid.

It is also abolishing the right of British citizens to make their own choices. Tory Ministers support boycotts against Putin’s Russia over his barbaric attacks on Ukraine but want to ban even those advocating boycotts of Israeli products from settlers in the West Bank who have stolen Palestinian land in flagrant breach of international law. Ministers have said that Russia and Belarus would be exempt, but what about public bodies wishing to take boycott action over China’s oppressive treatment of Uighur Muslims or the Myanmar junta’s genocidal banishment of Rohingya Muslims?

The Bill violates UN Security Council Resolution 2334, which the UK voted for and which declares Israeli settlements in the Palestinian territory occupied since 1967, including east Jerusalem, as legally invalid and a clear violation of international law. The Bill explicitly designates Israel for special protection and seems to encompass the illegally occupied territories within its definition of Israel. Surely local authorities should have the discretion to make ethical decisions in line with the preferences of their constituents and the freedom to align with international law and exercise due diligence in procurement.

The Conservatives, I am afraid, have previous form on authoritarian repression of such ethical boycotts. In 1988 Prime Minister Margaret Thatcher, having denounced him as a terrorist, imposed restrictions on political action by local councils in support of Nelson Mandela, by then into his 25th year in prison.

This Bill echoes a part of her Local Government Act 1988 preventing local authorities boycotting goods from apartheid South Africa as she attempted to shore up its economy. Local authorities such as Glasgow, Sheffield, Camden, Islwyn and a host of others decided not to buy apartheid goods. In 1981 Sheffield became the first to pledge to end all links to apartheid South Africa by withdrawing pension fund investments from companies with South African subsidiaries and barring its whites-only sports teams from playing on Sheffield’s sports fields. Others followed, including Cambridge, Newcastle, Glasgow and most inner London boroughs.

By 1985 more than 120 local councils had taken some form of action, from banning South African produce in their schools to granting the freedom of their city to Nelson Mandela, Glasgow City Council being the first. In London, Camden Council renamed the street where the Anti-Apartheid Movement had its office Mandela Street. Other cities, such as Leeds with its Mandela Gardens, bestowed honours on Nelson Mandela. The 1988 legislation did not work. By the time the Act came into effect, the apartheid regime was collapsing and the release of Nelson Mandela was looming.

The right to boycott is a principle that has had a massive impact for good. International pressure to cut links with the apartheid regime included disinvesting, not buying goods produced by it and not providing sporting or cultural cover for a regime that the United Nations had deemed a crime against humanity. Democratically elected local authorities should be able to use their resources in ways that do not sustain oppressive regimes where human rights are violated.

For 35 years a consumer boycott was at the heart of anti-apartheid campaigns in Britain. Hundreds of thousands of British people who never attended a meeting or demonstration showed their opposition to apartheid by refusing to buy goods from South Africa. I took part in action to plaster “Danger: Product of Apartheid” stickers on South African products in supermarkets.

The objective of local councils, joined by student unions, was to create apartheid-free zones. From the early 1970s, almost every university and college in Britain joined in. At more than half, students called on the university authorities to sell their shareholdings in British companies with South African interests and pressed for total disinvestment. Many student unions also banned South African goods from their bars and canteens, and their protests drove Barclays Bank off campuses, forcing it to close down its South African operations.

In 1964, the University of London Union made Nelson Mandela its honorary president. In the 1980s, many student unions named buildings in honour of Mandela and initiated moves to grant him an honorary degree. The British Anti-Apartheid Movement’s boycott campaign was hugely successful, lifted only in September 1993 after South Africa was irrevocably set on the path to democratic elections. Yet, and this is my key point, as Richard Hermer KC of Matrix Chambers stated clearly in paragraph 13 of his legal opinion on the Bill:

“Had legislation of this nature been in effect in the 1980s it would have rendered it unlawful to refuse to source goods from apartheid South Africa”.


Shame on this Government for introducing this shameless Bill. I trust that your Lordships’ House will dismember it through amendments and stand up for human rights worldwide.

--- Later in debate ---

[Lord Hain (Lab)]

I am sorry to detain the House. Not only do I endorse everything that my noble friend Boateng said, but the American Government under President Reagan also opposed boycott action. It was only the Black Caucus in Congress forcing through the loan sanctions in the late 1980s that accelerated the decline of apartheid. Virtually every Government in Europe and right across the world, including white Commonwealth countries, opposed boycott action in every respect. If the Minister’s officials are feeding her this nonsense, she should not simply repeat it.

[Baroness Neville-Rolfe (Con)]

I am grateful for the comments of the noble Lord, Lord Hain. I will certainly look into this further and perhaps we can come back to it on another occasion.

Perhaps me could move on, in the interests of time, to climate change. I would like to clarify that the Bill will ban only considerations that are country-specific. It will therefore not prevent public local authorities divesting from fossil fuels or other campaigns that are not country-specific.

The Bill will not prevent public authorities accounting for social value in their procurement decisions, the reform mentioned by the noble Lord, Lord Collins— of course, we worked together on moving to most advantageous tenders; that is a change that has come about. For example, authorities might structure their procurement so as to give more weight to bids that create jobs or promote animal welfare. Moreover, the Bill contains an exception to the ban for considerations that relate to environmental misconduct, as I think the noble Baroness, Lady Bennett, mentioned.

To answer the question from the noble Lord, Lord Collins, there was official-level engagement with the devolved Administrations on the Bill’s provisions before it was introduced to the other place through the common frameworks working groups process. Senior official engagement on the Bill dates back to April 2022. The Minister for this Bill in the other place, who I saw witnessing our proceedings earlier this evening, has also engaged with responsible Ministers in Scotland and Wales. We intend to engage with Ministers in Northern Ireland now that power has been restored.

The Government have never set out to legislate without consent. We formally sought consent from all the devolved legislatures. Where the legislative consent process is engaged, we always tend to legislate with the support of the devolved Administrations and the consent of the devolved Parliaments. However, as the noble Lord, Lord Stevens of Birmingham, highlighted, boycotts and divestments against foreign countries or territories are a matter of foreign policy. This Bill relates to foreign affairs and international relations, which are reserved matters, but I am sure we will come back to this point in Committee.

I turn to the Bill’s enforcement powers. I start by clarifying that the Bill does not create any new criminal offences, as suggested by the noble Baroness, Lady Janke. They are not criminal offences. Moreover, these enforcement powers are not unprecedented: the regime is based on existing enforcement regimes, such as the powers given to the Office for Students in the Higher Education and Research Act 2017. Clause 7 is a necessary addition to the Bill to ensure that enforcement authorities have the necessary information to assess whether there has been a breach of the ban. It would not make sense to implement a ban with a toothless enforcement regime but, again, I am sure that we will discuss enforcement further in Committee.

The noble Baroness, Lady Chapman of Darlington, and the noble Lords, Lord Wallace of Saltaire, Lord Willetts, Lord Hannay of Chiswick and Lord Johnson of Marylebone, questioned why the ban needs to apply to universities. This ban will ensure that any public authority, including universities in scope of the Bill performing public functions, can maintain their focus on their core purpose rather than taking partisan stances that undermine community cohesion.

It is not appropriate for those institutions to have a corporate view on a matter of foreign policy in the context of their public investment and procurement functions. That risks stifling the academic freedom of individual members of staff to take positions on foreign policy. However, I note the comments made by the noble Lords, Lord Johnson, Lord Willetts, Lord Shipley, and others on the ONS reclassification of universities. I will come back to noble Lords on this issue in Committee, once I have consulted other Ministers.