Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Hain Excerpts

Wednesday 17th April 2024 Lords Chamber

[Lord Hain (Lab)]

I am grateful to the noble Baroness. I did not advocate a boycott; that was not my purpose. I was talking about the destruction of the environment in Gaza and the West Bank, and that is not disputable.

[Baroness Deech (CB)]

The environment is bad in Gaza, but this Bill is about boycotts.

Now, no less a moral authority than Helen Suzman said that boycotts do not work. In 1987, she said:

“If there were any chance that sanctions would dismantle apartheid, I would be the first to support them. But reducing South Africa to a wasteland would lead not to a nonracial democracy but to more oppression and misery”.


A boycott, in particular a boycott of the so-called Occupied Territories, would not actually change the international scene as far as a two-state solution goes. The only people who would be hurt are the impoverished Palestinians working in the businesses in the Occupied Territories. This was proven by the SodaStream case. SodaStream closed down because it was thought unacceptable to deal with it because it worked in the Occupied Territories. Hundreds of Palestinians lost their jobs; SodaStream moved to Israel. We have to drop the illusion that a boycott of Israel, or indeed any other country, will achieve anything meaningful, let alone when it is carried out by a local authority as opposed to the Government. Environmental damage is indeed a problem, but I am not sure this Bill is the way to tackle it.

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[Lord Roborough (Con)]

I am grateful to the noble Lord for the intervention. I should declare an interest, as set out in the register, in various investments in companies around the world, including in Brazil and Indonesia. I am familiar with the points he raised. I think I answered as well as I can with reference to the Procurement Act and consistency with that, but I would like to write to the noble Lord, if that is helpful, to clarify further.

[Lord Hain (Lab)]

My Lords, in responding to the debate I invite everybody who heard what I said, and those who did not hear what I said, to read it in Hansard tomorrow. Did anybody hear me advocate the BDS cause? Did anybody hear me advocate a boycott of the State of Israel? I did not and I never have in any speech in this House or elsewhere. If there is criticism to be made of what I said, I invite noble Lords and Baronesses to focus on what I said rather than what they think I might have said, or what others have said. I think that is fair, frankly, in terms of debate in this House.

I say to the noble Baroness, Lady Deech—many in this House have considerable respect for the role that she plays—that I think she spoiled her argument by bringing in the South African comparison. She quoted Helen Suzman, who played a valiant role in the anti-apartheid struggle—a lone white role in many respects. At the time the noble Baroness quoted her, it was illegal to advocate a boycott or any kind of sanctions against the apartheid state. Indeed, she opposed boycott campaigns against all-white sports tours I organised, but if she had supported them and advocated sanctions, she could have been imprisoned under apartheid law. I would prefer to quote Nelson Mandela, who said that sanctions were very effective in bringing apartheid to its knees, along with other factors, so the noble Baroness spoiled her argument by quoting that.

[Baroness Deech (CB)]

I will be brief because the night is late, and I am provincial and have to get a train. I have done a lot of research into what allegedly changed South Africa, and the majority of the writings were that it was not sanctions. What changed life there was having two leaders of moral stature who were prepared to talk to each other, which we do not have in the Middle East. As far as the noble Lord’s advocacy of boycott goes, I cannot recall when—I think it was way back in March when we started to talk about this Bill—but the noble Lord himself raised the issue of South Africa, and how things had changed there because of a boycott. The inevitable conclusion to be drawn, though I resist the parallel, is that something like that would work in the case of Israel. I do not think it would, as they are not at all similar, but the night is late, and this Bill is not supposed to be about it.

[Lord Hain (Lab)]

I agree that they are not that similar, and I have never suggested that they are. The reason I brought in the South Africa comparison, and majored on it, is that legal opinion says that this Bill would have made the anti-apartheid campaigns of the late 1960s, 1970s and 1980s illegal. That is why I brought the argument into play. It is not to advocate a boycott, disinvestment or sanctions policy against Israel, which I have never done in this House or elsewhere. If noble Lords are going to disagree with me, as they are entitled to do, then they should make the case on the arguments as they stand.

Since the noble Baroness has intervened again on this, I am sure she has read widely on it, and I am not going to disagree with that, but Nelson Mandela did not agree with her. He said that sanctions were critical. They were not the only thing, and I did not say that they were. The internal contradictions of the system, the fact that the economy was almost on the point of collapse by the time that President de Klerk released Nelson Mandela, that the country was on the brink of civil war and facing the abyss in that respect, was why the people who had imprisoned him for 27 years and oppressed his people were forced to negotiate with him, both for his freedom and for that of his people. It was an accumulation of factors, but sanctions were certainly very effective. The noble Baroness spoils her case about Israel by seeking to deny that.

The noble Lord, Lord Pickles, made a strong point that there are others culpable for the environmental destruction, and I have never denied that. He made some important points about the culpability of Hamas as well.

[Lord Pickles (Con)]

Forgive me for interrupting, but I have just realised that when I made my speech, I did not declare my interests. I would like to do so now, particularly those relating to friendship for Israel.

[Lord Hain (Lab)]

I am happy to be interrupted on that point.

My point to the noble Lord, and to the whole House, is that this Bill is technically flawed. I refer to the explanatory statement that I put on the face of my amendment:

“This amendment seeks to ensure that the Secretary of State cannot remove environmental misconduct as an exception in the Schedule by regulations”—


in other words, by executive decision. This should not be possible, and it should remain in primary legislation. That was the purpose of my amendment.

That brings me on to what the noble Lord, Lord Wolfson, argued. He—and I commend him for this—technically disputed the basis for my amendment, which he is entitled to do. I disagree with his interpretation, and I do ask the noble Lord to reflect on this: what was factually erroneous about what I said in terms of the case I put on environmental destruction in Gaza and the West Bank?

The noble Baroness, Lady Altmann, for whom I have a great deal of respect and count as a friend, pointed out that Israel has planted a considerable number of trees, for which I commend Israel. My point is that there is terrible environmental destruction in Gaza and the West Bank now. Nobody can dispute that, and it has been going on for a long time, including the destruction and poisoning of the water supply for many Palestinian residents there.

[Lord Wolfson of Tredegar (Con)]

My Lords, I did not introduce a technical problem with his amendment. I sought to explain to the Committee, and to him, that the basis of his amendment—that is, that the Secretary of State could by regulation remove this exemption—was entirely flawed. Having mentioned this in passing as a technical response, he has now gone back to his favourite subject of attacking Israel. Is he going to provide a response to the fundamental problem that I raised with his amendment?

[Lord Hain (Lab)]

I have already done that. On what he calls my favourite hobby of attacking Israel, as it happens, as I said in the foreign affairs debate, the whole strategy for resolving this terrible dispute is fundamentally flawed. The lessons should be learned from the Northern Ireland experience. Hamas will not be defeated militarily, however much I would like it to be. I made it clear that I am a friend of Israelis as well as Palestinians, but we are not revisiting all of that. On the criticisms, apart from the noble Lord’s criticism of the case that I have made, I invite people to engage on the substance, rather than bringing in arguments that I have never made in order to adopt a kind of diversionary tactic on this.

To conclude, the Bill is flawed and the Minister, speaking for the Government, should look again at this matter. If there is an issue with the wording of my amendment, then we can discuss that. Unless that is done, people will interpret the Government’s stance as showing that environmental protection is not being given the priority under the Bill that it should. Having said that, I beg leave to withdraw the amendment.

Amendment 15 withdrawn.

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There are many reasons why the Bill should not pass, not least because it is an embarrassment to this Parliament. Any Bill that attempts to prevent people who hold different political or moral views from the Government expressing those views with the threat of legal redress belongs in a totalitarian regime, not in a constitutional democracy. That is particularly the case when the Government seek to silence other elected representatives. Demeaning their electoral mandate is totally unacceptable and should be opposed.

[Lord Hain (Lab)]

My Lords, I apologise to the Committee for speaking so soon after my previous contribution, but I will speak to my Amendment 20A. I associate myself with the amendments of the noble Baroness, Lady Bryan, which I have signed.

I am grateful to the noble and learned Lord, Lord Thomas of Cwmgiedd, and the noble Baroness, Lady Randerson, for adding their names to my Amendment 20A. This iniquitous Bill challenges the very foundations of devolution in the United Kingdom—namely, that decisions should be taken at the local level, and that local leaders should be answerable for them, rather than decisions being taken at the centre by remote politicians and officials. I say that as a former Secretary of State for Wales who helped bring in the Government of Wales Act 2006, which strengthened the devolution possibilities for the now Welsh Parliament —the then Welsh Assembly. My amendments and those of my noble friends address one aspect of that: they seek to remove from the Bill matters for which the Governments of Scotland, Wales and Northern Ireland should properly be responsible.

I will speak about Wales in particular. The Explanatory Notes acknowledge that the Bill affects the decision-making of the devolved Administrations. The memorandum of 8 September 2023 from Rebecca Evans MS, the responsible Welsh Minister, set out in detail the way in which the Bill intruded into devolved competences in Wales and why it was right to withhold the legislative consent of the Senedd—which has occurred.

Deciding whether a particular purchase or contract should be made by the Welsh Government, or any other public authority in Wales, is patently a function exercisable in relation to Wales under the terms of Section 3 of the Wales Act 2017. The conduct of foreign affairs is reserved to the UK Government under that Act, but the making of moral or political judgments about the conduct of foreign states is not conducting foreign policy. That is a crucial distinction denied by this authoritarian Bill, which abrogates powers to Ministers so that they can act by executive diktat—in this case, by overriding the devolution settlement in respect of Wales, Scotland and Northern Ireland.

Moral and political judgments are made by every individual—and so they should be; they should not be dictated by the centre. That means that the decision-maker should be at the lowest accountable level. In the case of Wales, decisions should be taken by a county or county borough council, the Welsh Government or the Senedd. Those authorities would be answerable for the moral and political judgments they make at the local or all-Welsh level. Are the Government seriously saying that they have a monopoly on moral and political judgment? That is what the Bill saying, which is both arrogant and absurd. Council tax payers in Neath, Gower, Wrexham or the Vale of Glamorgan are best placed to decide whether their councils are making the right decisions, and electors in Wales can make the same decision about the Welsh Government’s and the Senedd’s choices.

I cannot agree more with the Welsh Government’s view that the Bill is disproportionate and unnecessary, and I support the Welsh Parliament’s decision to refuse to give it legislative consent.

There are also major constitutional issues. If the Bill is enacted, it will fly in the face of the fundamental constitutional principle articulated in Section 2 of the Wales Act 2017, with parallel provisions, of course, for Scotland and Northern Ireland, that the Parliament of the United Kingdom will not normally legislate with regard to devolved matters without the consent of—in this case—the Senedd in Wales, the Parliament of Scotland or the Assembly of Northern Ireland.

The Bill would also fly in the face of the principle of subsidiarity to which the Government ostensibly subscribe: namely, that decisions are made at the level closest to the citizen, consistent with effective delivery.

So far as our amendments are concerned, because there is a single jurisdiction of England and Wales—something that the noble and learned Lord, Lord Thomas of Cwmgiedd, has reported on compellingly—the amendment of Clause 17 to remove the word “Wales” would not work technically. For that reason, it is necessary to achieve the removal of Welsh devolved bodies from the Bill in a different way from the way that can be achieved for Scotland and Northern Ireland, because England and Wales have a common legal framework and that is not the case for Scotland and Northern Ireland. That is done by my amendment to the schedule. This would add the Welsh Government and public authorities that are responsible to that Government to those bodies excepted from the provisions of Clause 1. Effectively, it would mean that the Bill would not apply in devolved Welsh areas.

Our amendments are an opportunity for these issues of devolution to be canvassed, for the devolution settlement to be preserved and for the rights of the other Governments in United Kingdom and their legislatures to be asserted. I hope that the House, in some way, will manage to protect the devolution settlement, because otherwise the future of the United Kingdom is threatened.

[Baroness Bennett of Manor Castle (GP)]

My Lords, it is a pleasure to follow the noble Baroness, Lady Bryan, and the noble Lord, Lord Hain, and to essentially agree with everything they said. I rise to offer Green support; I am not going to engage in the technical details, which the noble Lord, Lord Hain, set out so clearly, but I will simply say that this Bill should not apply to Wales, Scotland or Northern Ireland.

I listened to the debate on an earlier group, when the noble Lord, Lord Boateng, talked about a small nursery, run by a charity, deciding to ban oranges from South Africa. That obviously is not right—it is the sort of thing that the Bill appears to be addressing—but how much more so when we are talking about an entire devolved Administration? If we think about the kinds of examples that might apply here, let us say that one of the nations’ devolved Administrations might choose to block a supplier of staff uniforms because the clothing is made under abusive conditions in an abusive regime. How can it not be right that the people of Wales can decide for themselves that they do not want to see people wearing uniforms from that kind of source?

In the earlier group, my noble friend Lady Jones of Moulsecoomb pointed out how the environmental derogations are utterly inadequate. How can it be that the Scottish Parliament could not decide to ban food sourced from deforested areas of the Amazon from being served in the Parliament? Those are the kinds of things that the Bill is currently providing.

It is worth looking over the history of this a little bit. I think it was two Prime Ministers back—it is rather hard to keep track, but I am referring to Boris Johnson. Under Boris Johnson, it seemed that there was a real desire to pick fights with the Scottish Parliament and the Welsh Senedd in particular. Since then, we have seen some improvement; we have seen the Review of Intergovernmental Regulations, which said that

“decisions will continue to work on the basis of agreement by consensus”.

I think that is an important phrase to look at, although I note we have seen some backsliding recently, and perhaps this Bill is a symbol of that.

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[Baroness Noakes (Con)]

My Lords, I think that noble Lords who have spoken have misrepresented the devolution settlement. It is clear that foreign policy is a reserved matter. When we come to this Bill, the question of the political or moral disapproval of the conduct of foreign states is a matter of foreign policy that can be determined only by the UK Government.

Noble Lords have been trying to describe devolution as they would like it to exist but the plain fact is that foreign policy is a reserved matter, and that is what is driving this. I do not think that the other matters that the noble Baroness, Lady Randerson, just referred to prevent action by the devolved authorities because of the quite extensive exemptions, which align with the procurement legislation, that are set out in the Schedule. We are talking about political or moral disapproval of state conduct, very specifically, and that is a matter reserved to the UK Government.

We have to remember that the devolved Administrations have form here in relation to Israel. To take the Scottish Government, back in 2014, they issued a Scottish procurement policy note which, in effect, encouraged Scottish bodies to boycott operations in the Occupied Territories. That note, which is quite difficult to find on the internet nowadays, because it seems to have disappeared into a black hole of an archive, was reconfirmed by current Scottish Ministers only a couple of years ago, so it remains the Scottish Government’s policy, which they cannot effectively implement because of the reserved nature of foreign policy.

To take the Welsh Government, in 2020 they informed the Welsh Parliament that they intended to issue advice to all Welsh authorities

“that they may exclude from tendering any company that conducts business with occupied territories either directly or via third parties”.

It was only after intervention from an organisation called UK Lawyers for Israel that the Welsh Government deferred their decision. So we have the Scottish Government and the Welsh Labour Government itching to boycott Israel, and to use that as a reason—

[Lord Hain (Lab)]

The noble Baroness accurately quoted the Welsh Government’s position as referring to occupied territories which are illegally occupied, including those determined by the British Government, not as boycotting Israel.

[Baroness Noakes (Con)]

Whether that is relevant is another matter, because the boycotting of the Occupied Territories would also cause a problem under this Bill if Wales and Scotland were allowed to, in effect, opt out of the Bill.

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So I say to the Government—this is where I come to my question—“You can get yourself into a tangle because now, if you concede to these amendments, it will be very difficult for you, because if you concede to them and then do nothing for England, you will put English authorities in an inferior position to the authorities in Scotland, Wales and Northern Ireland”. So the Government will get themselves into a tangle, if they concede to these well-argued amendments, over what they would do about England. I cannot see local government in England being terribly thrilled if the Government have given way to these three, rightly, devolved Administrations. What will they say to the local authorities in England about why they are put in an inferior position to local authorities in Scotland, Wales and Northern Ireland? That is where you would end up. So my question to the Minister—

[Lord Hain (Lab)]

I am very grateful. I agree with everything he has said. On his point about central government not always being correct, that would have been the case in the 1930s when a Conservative Government were appeasing Hitler and there was massive pressure from outside, from people in all walks of life who took a different view, that eventually forced a change of policy and Churchill took over with a different policy—thank goodness.

[Lord Warner (CB)]

Absolutely—I thoroughly agree with the noble Lord, and this comes to my question as to whether the Government have thought this through. I do not know what the penalties will be for breaches of this law, but I can foresee that, on some issues, people will feel so strongly that they will be prepared to pay—you might say it is the cost of trade—the penalties so that they can demonstrate to the Government what they feel about a particular action in a particular country by a particular Government. Have the Minister and the Government thought through what happens if there is a willingness among groups of people to take a stand against this Bill, accepting that they may get some financial penalties and being prepared to pay those penalties because they feel so strongly about a particular issue?

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[Baroness Neville-Rolfe (Con)]

If I may, I will come back to that at the end of the speech, because I want first to try to explain what we are doing with the devolved Administrations. The noble Baroness, Lady Randerson, said that the WTO already places non-discrimination requirements on public authorities. Although this is the case, these obligations do not cover all countries and territories and apply only to procurement decisions, not investment decisions.

To return to the subject of legislative consent, I think it is fair to say that we are disappointed that the Senedd and the Scottish Parliament have refused to give their consent to apply the ban to their Ministers and the respective departments and agencies. It is always the Government’s intention to legislate with the support of the devolved Administrations and, where relevant, the consent of the devolved legislatures. We will therefore continue to ensure that the interests of the devolved Administrations, including the devolved assemblies, are fully taken into account. Contrary to the noble Baroness’s suggestion, we do engage with the devolved Governments. I was in Northern Ireland last week, I visited the Welsh Government relatively recently, and my office has contacted the offices of the relevant Ministers in the Scottish and Welsh Governments. I hope to meet with them in the coming weeks to discuss further how we can gain their support for the Bill.

[Lord Hain (Lab)]

I will be brief, given the hour. What advice would the Minister give to Welsh local authorities if they refuse to procure or encourage any local companies to do business with Xinjiang province in China because of its oppression of the Uighur Muslims? China, unlike Russia and Belarus, is not listed in the Bill in that way.