All 6 Lord McNicol of West Kilbride contributions to the Subsidy Control Act 2022

Read Bill Ministerial Extracts

Mon 31st Jan 2022
Subsidy Control Bill
Grand Committee

Committee stage & Committee stage
Wed 2nd Feb 2022
Mon 7th Feb 2022
Wed 9th Feb 2022
Tue 22nd Mar 2022
Subsidy Control Bill
Lords Chamber

Lords Hansard - Part 1 & Report stage: Part 1
Tue 22nd Mar 2022
Subsidy Control Bill
Lords Chamber

Lords Hansard - Part 2 & Report stage: Part 2

Subsidy Control Bill

Lord McNicol of West Kilbride Excerpts
Baroness Randerson Portrait Baroness Randerson (LD)
- Hansard - - - Excerpts

My Lords, I will speak specifically to Amendment 20, in the name of the noble Lord, Lord McNicol, to which I have added my name. Before I do, I want to place on record my concern that our debates on the Bill are being held only in Grand Committee. This Bill is of equal significance to the internal market Bill, and it has both economic and constitutional significance way above the status it is apparently being given by being located here.

Amendment 20 closely reflects the concerns of the Welsh Government, and there are of course similar concerns among the Scottish Government. In comparison with the other amendments in this group, Amendment 20 is a modest request for the Secretary of State to seek consent from the devolved Governments. However, if consent is not given the Secretary of State can go ahead anyway. This reflects a formula accepted by the Government in other pieces of legislation, which I assume is why it was written in this way—because it is the least controversial option of those put forward. It implicitly allows for a situation in which a devolved Government might seek simply to frustrate the UK Government’s efforts without full discussion and, therefore, does not reflect that in the vast majority of situations devolved Governments seek to negotiate in good faith with the UK Government. That is what the Welsh Government have certainly done this time, but they are not prepared to issue an LCM.

I signed the amendment despite my reservations that a Secretary of State’s Statement is to go to the House of Commons and that this place is not referred to. Given our attention to detail, I would hope that both Houses would be kept informed.

The amendments in this group all seek to restore an appropriate counterbalance to the sweeping powers the Bill allocates to the Secretary of State. Despite the Government’s chastening experience during debates on the internal market Bill, they seem heedlessly determined to continue their smash and grab on the powers of the devolved Parliaments. I am pleased to hear that at least one department of the UK Government has seen the light on this, but that does not alter the fact that the Bill is unreconstructed in its approach.

The Government talk about strengthening the union but are seizing every opportunity to undermine devolution. Powers over economic development and its funding have been devolved, in effect, since the Welsh Development Agency was established in 1975. Long prior to devolution, it was an example of excellence in pursuing successful economic development opportunities, mostly using funding.

The Minister will undoubtedly protest that nothing here removes powers over economic development or agriculture, for example, but power without funding power is a meaningless shell. This system allows the Secretary of State to halt schemes devised by devolved Governments because they are deemed unfair, but it does not in turn allow the devolved Governments to complain about the Secretary of State’s schemes devised for England.

It is not surprising that this is a sensitive issue in Wales. Under the EU system, two-thirds of Wales benefited from regional funding. In the Brexit debate prior to the referendum, people in Wales were promised specifically that they would not lose a single pound or euro, and voted accordingly. That promise proved very wide of the mark, and people in Wales feel betrayed.

It is worth noting that devolution in Wales is much less controversial than in Scotland. It enjoys very broad support across the political spectrum, and chipping away at the Welsh Government’s power to deliver on economic development or agriculture, for instance, is a dangerous path for the UK Government to take. I hope Ministers will see the light.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, I thank the noble Baronesses, Lady Humphreys and Lady Randerson, for putting their names to a number of my amendments in this group. I thank the noble Lord, Lord Wigley, as well. His opening remarks summed up the thrust of group one, which is to ensure that the devolved Administrations are fully involved and engaged, and that there is parity of esteem for all the relevant legislatures. It set up the framework for this group of amendments rather well.

As we have heard, this is the first of several important debates on devolution, one of the major concerns about the Bill. As has been noted, at Second Reading the Minister outlined the number of meetings he had had with devolved officials—45, I think, 13 of them to talk about the regime itself. It is concerning that those meetings have taken place but we still find ourselves in a situation where there are unresolved issues with the Scottish Government and the Senedd.

My take on this is that it will not take a lot to move this on. In fact, as the noble Baroness, Lady Randerson, said, Amendment 20 is a very modest amendment, which would give the Secretary of State the power still to press ahead after a month if an agreement has not been reached. These are not tough amendments, especially following some of the debates in the Commons.

On that subject, I thank the department for releasing the guidance, but it is a bit bizarre that the Bill passed through the Commons stages without any of the guidance being published or being able to be read. There are still a lot of square brackets in the guidance and bits that needs to be filled in. As we will touch on later, the concerns that the DPRRC raised will, I hope, lead to some positive changes to the Bill.

A number of noble Lords spoke at Second Reading of their concerns and those of the devolved Administrations, many of which we shared and echoed. Amendments 13, 16 and 17 are intended to make it clear that the devolved authorities can make and modify streamlined subsidy schemes. As we are aware, at present the Bill reserves that power for the Secretary of State, although comments were made in the debates in the other place by the Commons Minister that this could be broadened out. It would be good to hear from the noble Baroness, when she responds on behalf of the noble Lord, Lord Callanan, whether we have seen any movement or development in broadening it out.

We also saw, throughout the Brexit process, which was touched on by a number of noble Lords, that when we got down to the detail in your Lordships’ House we were able to make changes and amendments. The noble and learned Lord, Lord Hope, talked about some of those regarding the internal market Bill. It would be good if we did not have to take this as far or go through the same pain and difficulties that we did on that Bill, especially when the amendments we are looking to make fit into and sit alongside the same changes made there. With that, I will conclude. I look forward to the noble Baroness’s response.

--- Later in debate ---
Finally, since March 2021 UKGI has overseen nearly £100 billion-worth of borrowing to over 230 companies across the country. This, together with the activities of the British Business Bank, has led to a degree of corporate financial activity on a scale unseen, I suggest, for generations. I think the noble Lord, Lord Lamont, referred to that as well. It seems inconceivable that some of those loans will not be converted to equity at some point and I would like the Minister to explain, in the event that they are, how that sits within the constraints of the Bill.
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, I have very little to add to what other noble Lords have said. I am grateful to the noble Lord, Lord Wigley, and my noble friend Lord Chandos for Amendments 2, 2A and 3. As has been said, they go to the heart of the Bill. Clause 2 is titled “Subsidy” and lays out the effect and explanation of what a subsidy is or can be. The noble Lord, Lord Wigley, has come up with an interesting means of looking at protecting the devolved authorities’ interests by making it clear, as we have heard, that certain forms of payments would not be classified as subsidies and would therefore fall outside the control and requirements of the Bill.

The amendment from my noble friend Lord Chandos raises an interesting point in relation to the illustrative documents that have just been released. As the noble Lord, Lord Fox, said, my noble friend’s amendment was tabled late but that was because the guidance papers were released so late. If some of the guidance and regulations had been shared and published earlier, some of our colleagues in the elected Chamber may well have been able to pick up and dig into some of these issues.

The noble Lord, Lord Wigley, touched on the use of subsidies as a legitimate tool for securing economic benefit when done correctly, but also when done transparently. This is one of the fundamental issues we will come on to in later amendments. The big difference from European state aid is obviously that an agreement had to be reached before state aid was brought in. With this system, and this is one of the benefits of it, the subsidy can be brought in very quickly beforehand. But that creates a huge dilemma if the information on the subsidy is not transparent, and if there is no proper opportunity to analyse and challenge it. That is why we will be going into far more detail on this.

Tidying up some of these issues and getting them into the Bill, rather than in secondary legislation and regulations, would help to move it into a far better position. With that, I look forward to the noble Baroness’s response to the issues, especially the one raised by my noble friend Lord Chandos on why equity cannot be added straightforwardly. The Minister, the noble Lord, Lord Callanan, has tabled a number of government amendments. It would be great if we could do some of the tidying up as we move through Committee.

Baroness Bloomfield of Hinton Waldrist Portrait Baroness Bloomfield of Hinton Waldrist (Con)
- Hansard - - - Excerpts

My Lords, again, I am grateful to the noble Lord, Lord Wigley, for tabling his amendments, and to all noble Lords for participating in the debate.

Clause 2, as the noble Lord, Lord Fox, said, is the cornerstone of the new subsidy control regime as it sets out the definition of a subsidy for the purposes of the Bill. The definition consists of a four-limb test, and all four limbs must be satisfied for a financial measure to be considered a subsidy. I also draw the Committee’s attention to Clauses 3 to 8, all of which are necessary to understand the definition of “subsidy”. I believe that those provisions collectively provide sufficient clarity and legal certainty to ensure that all public authorities can give subsidies with confidence. We will provide guidance on this matter as the Bill comes into force.

In response to my noble friend Lord Lamont, I believe the Bill sets out a series of overarching principles that provide a level playing field for all public authorities in the UK. The Bill is not a framework for funding; therefore, in response to my noble friend, spending decisions are of course for the Chancellor. It is a set of rules that all public authorities must follow in their decision-making when they give a subsidy or make a scheme. I do not recognise the criticism that it is too streamlined or too narrow, or that it will not be accessible to the devolved Administrations and to other public authorities outside Westminster. The streamlined subsidy schemes that we create will be beneficial but also entirely voluntary for public authorities to use. I note too that we have adopted helpful suggestions from the devolved Administrations for the illustrative Subsidy Control (Subsidies and Schemes of Interest or Particular Interest) Regulations on the treatment of rescue and restructuring subsidies to ailing businesses, as well as in relation to the identification and selection of sectors of interest.

Amendment 2, proposed by the noble Lord, Lord Wigley, would exclude from the definition of a subsidy financial assistance offered by a public authority to all enterprises operating wholly or largely within its territory. I entirely agree with the noble Lord that it is of the utmost importance that public authorities are responsible for the financial assistance that they provide within the areas for which they are accountable, and that when a devolved Administration—or, for that matter, a local authority—design a scheme that is general to enterprises in their territory, subsidies should not be specific. Of course, those subsidies should be designed in support of the economy and community for which the public authority is responsible in order to address market failures or issues of disadvantage. I am pleased to inform the noble Lord that that is what Clause 2 provides, with particular reference to the notion of what constitutes a specific subsidy in Clause 2(1)(b) and Clause 4. I am grateful to him for raising this important point.

The requirement that is relevant to the noble Lord’s amendment is that a subsidy must be specific. In order to be specific, Clause 2(1)(c) provides that it must benefit one or more enterprises over one or more other enterprises with regard to the production of goods or the provision of services. When determining whether a subsidy benefits one or more enterprises over others, it is necessary to consider what constitutes the reference framework for that subsidy by reference to the legal basis for that subsidy, the authority giving the subsidy and how it is financed, in order to determine who is in the same legal and factual position.

Where a UK-wide power is conferred on a UK Minister, the reference framework is the whole of the UK, while a subsidy that will benefit only enterprises in a specific part of the UK—such as Wales or, indeed, London—will meet the definition of a specific subsidy. However, when an Administration covering a discrete area, such as a devolved Administration, make a subsidy under the powers conferred on them, the reference framework will be the territory of that Administration.

Therefore, in the case of Wales, for example, a disadvantaged workers’ subsidy scheme that is available equally to all enterprises in Wales will in most cases not be specific because the subsidy will not favour any enterprise in Wales over another enterprise in Wales in the absence of factors limiting the availability of the subsidy. However, a disadvantaged workers’ subsidy by the Welsh Government limited to enterprises in Newport, or which was otherwise limited in availability, would be a specific subsidy because it favoured enterprises in Newport over other enterprises in Wales. It can also be said, with reference to Clause 4(2), that the notion of the reference framework is inherent in the design of subsidies by the devolved Administrations because they can act only in pursuance of their devolved competences.

Similar provisions are made in relation to taxation in Clause 4 to ensure that, where a devolved Administration are acting autonomously in relation to a devolved tax or a variation of a national tax, there will not be a subsidy if the scheme of taxation does not contain elements that are specific to their areas of responsibility. Acting autonomously includes having the competence to set the tax and being responsible for the fiscal consequences of setting the tax at the chosen level.

I hope to persuade the noble Lord, therefore, that the discretions he wishes to maintain for subsidies that are general to enterprise in Wales—and not confined to certain enterprises in Wales—are inherent in the general principles in the Bill, which are derived from the TCA, without need for a specific amendment.

--- Later in debate ---
Finally, I apologise to noble Lords for the perceived lateness of the publication of the illustrative products last week; it was perhaps later than ideal. I welcome further engagement and comment from noble Lords on these before the versions are made in due course. For these reasons, I humbly request that the noble Lords do not press these amendments.
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

I do not think their lateness was perceived—it was real—but that is not why I rise. I go back to a point the Minister made on my noble friend Lord Chandos’s amendment. Under Clause 2 on “Subsidy”, she said that subsection (2) is not an exhaustive list. That is the subsection where my noble friend was looking to add “equity” after “grants”. It may not be an exhaustive list, but lines 23 and 24 say:

“For the purposes of this Act, the means by which financial assistance may be given include”.


If Her Majesty’s Government are not going to add anything in, can they at least clarify that the list in paragraphs (a) to (e) is not exhaustive? Am I just being a bit too pernickety?

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

Thank you. If the Minister wishes to write to us, that is fine. I am sure we will come back to this.

Baroness Bloomfield of Hinton Waldrist Portrait Baroness Bloomfield of Hinton Waldrist (Con)
- Hansard - - - Excerpts

I think I said that an equity investment is still considered a direct transfer of funds from one entity to another. The whole point of not putting in an exhaustive list is to avoid worry about what you leave out of a list, rather than what you have in it. I believe this is already covered by the Bill.

--- Later in debate ---
Moved by
7: Schedule 1, page 52, line 6, at end insert—
“(c) progress towards meeting the target in section 1 of the Climate Change Act 2008 (carbon target for 2050).”Member’s explanatory statement
This amendment adds consistency with the UK’s net zero commitments as a particular consideration for public authorities before deciding whether to give a subsidy.
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, the future of our planet should be of concern to us all. I am sure the noble Baroness, Lady Boycott, will argue that language around the preservation of it should be part of all our legislation as we move forward.

I have tabled Amendments 7 and 11, both of which are quite short. Amendment 7 would insert proposed new sub-paragraph (c), which refers to

“progress towards meeting the target in section 1 of the Climate Change Act 2008 (carbon target for 2050).”

This amendment adds consistency with the UK’s net-zero commitments as a particular consideration for public authorities before deciding whether to give a subsidy.

Amendment 11 is another short amendment, very much along the same lines, to insert proposed new sub-paragraph (c), which refers to

“delivering progress towards meeting the target in section 1 of the Climate Change Act 2008 (carbon target for 2050).”

We also support many of the other amendments in this group. I hope to hear the Minister provide a clear explanation exactly how the Bill as written, if these amendments are not accepted, will move us closer towards the 2050 net-zero target, and how the use of subsidies could and should contribute towards that.

There are a number of legitimate reasons for making subsidies to industries that have traditionally been associated with damage to—or, at least, not the preservation of—the environment. We have campaigned on this over the years. Many public authorities may wish to support jobs in industries such as steel that have environmental issues. Conversely, subsidies can be used to facilitate the green transition by investing in newer, greener technologies and approaches.

Any climate commitment in the Bill will have to be carefully crafted to balance any immediate economic concerns with the long-term environmental ones. As COP 26 highlighted, we are a long way from delivering the scale of change needed to preserve this planet for future generations. All the parts of the UK economy—our devolved authorities, local authorities and central government—will have to contribute towards hitting emissions and other targets.

The Minister will no doubt point to Schedule 2 as an example of Her Majesty’s Government’s commitment to the green agenda but, as we discussed at Second Reading, the application of the environmental principles is somewhat limited. In the further amendments to the Bill, does the department aim to broaden them in any sense?

From what we have heard in response to other amendments, the Minister is likely to resist the amendments in this group and not want to set any precedent, yet we have seen various commitments made in recent times, whether in the Pension Schemes Act, the Financial Services Act or the suite of Defra legislation, in which commitments have been given and gone into in more detail.

We want to support businesses to support the planet, and many will want to do the right thing, but financial incentives are often needed to help drive those key changes. This new subsidy control scheme should wherever possible support the transition to net zero. At Second Reading, the Minister mentioned net zero three times in his opening and closing remarks, but in the Bill as now crafted there is no mention of it. These amendments seek to impress upon the authorities that would be making subsidies the need for alignment with support for net zero. With that, I beg to move.

--- Later in debate ---
Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

I think if the objective is set then it is an overarching benefit, but I will be happy to confirm that to the noble Lord, Lord Purvis, and will copy the letter to the noble Lord, Lord Fox, as well. Once again, I will be very busy in my letter-writing activities for the next few days. With that, I hope noble Lords are satisfied—or, if not satisfied, content—with the answers that I have given and therefore, in compliance with that, that the noble Lord will feel able to withdraw the amendment at this stage.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

I thank the Minister for his response, and I thank the noble Baronesses, Lady Jones, Lady Sheehan and Lady Hayman, for their comments. I am not quite sure how many of the four questions asked by the noble Baroness, Lady Jones, we got through; we might be coming back to some of them.

As expected, to be fair, the Minister said that he believes we have the right framework in place and there is no need to extend it. I had a different take on the discussions with the noble Lords, Lord Purvis and Lord Fox, about paragraph G. The Minister said that not all subsidies will be relevant to net zero. As the noble Lord, Lord Fox, pointed out earlier, many subsidies fit around the issue of energy and climate but, if we take the Minister at his word on that and a particular subsidy has no meaningful impact on climate or net zero, his argument was that it could cause an extra administrative burden on the authorities if they have to show that it is not relevant. However, if the subsidy had no relevance to the environment or to climate. it would be relatively straightforward for them to say so. My feeling was that that negated the argument that the Minister was making for not including Amendments 7 or 11 in the Bill.

I am still genuinely struggling to understand why it would be so difficult to include that commitment, because those are guiding principles. If we all agree that we need to move towards net zero, protecting the environment and delivering on the climate emergency, then this is an opportunity to put that language in the Bill—especially a Bill that is so relevant to the fact that historically either state aid or government decisions, which we have argued for many times, have supported industries that harm the environment, albeit for very good reasons.

I am sure we will come back to this issue but, with that I beg leave to withdraw the amendment.

Amendment 7 withdrawn.

Subsidy Control Bill

Lord McNicol of West Kilbride Excerpts
Lord German Portrait Lord German (LD)
- Hansard - - - Excerpts

The Minister has mentioned the question of guidance twice. Guidance is not law, of course, unless it is. It exactly what it is meant to be: guidance. Given the importance of guidance to the question of what an area is, would it be possible for this guidance to be issued, even in draft form, before we conclude this Bill, so that we can at least know what is in the Government’s mind?

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

Just to take both earlier points, if the Secretary of State defined an area as the whole of the United Kingdom, and that covers it, part of the subsidies could be used to move businesses inside the whole of that area. If that is the case, it defeats the whole purpose of it, does it not?

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

I do not want noble Lords getting mixed up. I was referring to the fact that schemes can be designed for the whole of the United Kingdom. The purpose of this clause is to prohibit direct subsidies where a business is paid a sum of money to move from area A to area B—let me finish this point—depending on the definition of the areas that we spoke about previously.

However, that is only for direct subsidies, of course. The attractiveness, training provisions et cetera that could exist or be subsidised in a different area might make it more attractive for that business elsewhere, but the idea is to avoid the situation in the US that I talked about, where they come along and give companies—I will not name them, but noble Lords know the examples I am talking about—huge amounts of money literally to get it to close down its operations in one state and move to another. That is what we are trying to avoid, but we fully accept that it is perfectly in order to increase the attractiveness of an area, show how wonderful it is and show what is available there, including trading provision, sites et cetera. However, we do not accept using direct financial assistance to move from one part to the next.

We have already published illustrative guidance. We will look at enhancing that further with more detail before we commence with the legislation. If it is drafted and ready in time, I will share it with the noble Lord, of course.

--- Later in debate ---
Lord Purvis of Tweed Portrait Lord Purvis of Tweed (LD)
- Hansard - - - Excerpts

My Lords, I support my noble friend Lord Fox and will add a couple of points. First, on the streamlined schemes, there is the potential for them to be very major and, in effect, a policy driver in themselves. But if they are laid and are not in an order, which we would have the ability to scrutinise, they will not necessarily come with an equalities or impact assessment. It will be a fundamental weakness if they are simply laid. It goes against the grain of what we have been trying to argue, which is for good-quality proposals that come with equalities assessments. It will bypass that and that is a retrograde step.

On the ability to amend without there also being scrutiny, I point out, having checked on legislation.gov.uk, that there are 15 references to deposit-takers in other legislation and 34 references to insurers. What the Government propose is simply to amend primary legislation and a suite of other measures. The area of confusion for me is that there is also legislation that relates to Scottish insurance, which could be changed by a Secretary of State without there being proper scrutiny of that either.

My final point relates to the element of secrecy in Clause 47(7). The Government seem to be proposing that we go back to a situation of hue and cry, in which measures by the Treasury that could be supporting individual businesses will never be reported. We will know only if there are whistleblowers, if people are raising concerns and they have that knowledge. We saw to our cost with the Libor-fixing situation what can happen when there is a lack of transparency and reporting. It is simply not good enough. When I was a member of the Finance Committee of the Scottish Parliament, we had mechanisms for our committee to meet in private when Finance Ministers were able to say, either on the grounds of national security or during the economic crash, that there were reasons why information would not be made public at that point. We were briefed and there would, subsequently, be a report that Parliament could have. There are other mechanisms for secrecy than this approach.

Finally, I have been a Member of two Parliaments for 18 years now. I never thought I would read a parliamentary committee highlighting this statement:

“In other words, because the Government might be defeated if the direction could be voted upon, there should be no parliamentary procedure and no vote.”


This provision should not progress. It is as simple as that.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, I am grateful to the noble Lord, Lord Fox, for tabling these amendments. As we have heard, they reflect the bulk of the DPRRC’s recommendations. I also thank the noble and learned Lords, Lord Judge and Lord Thomas of Cwmgiedd, and the noble Lord, Lord Fox, for signing Amendment 50, even if it was not to support me but the recommendations of the DPRRC.

The DPRRC took the unusual step of voicing its concerns for Clause 47(7) at first, rather than working through the Bill and its clauses in turn. That goes to highlight even further its real concerns, specifically around issues of transparency and secrecy. We will come on to further amendments on transparency and try to open this up because, as we have heard, when you shine a light on the decisions being made, they are put under scrutiny. Issues and concerns can be brought to the fore so that we do not, as the noble Lord, Lord Purvis, said, end up relying on whistleblowers.

Taking the point made by the noble Lord, Lord Purvis, it may be that the immediate release of certain directions and information could have undesirable consequences in terms of market behaviour, but there must be other ways of taking it forward. The noble Lord has touched on one of them at the Scottish Parliament, where meetings were in private but the information was subsequently released.

At Second Reading, the Minister said:

“However, we will of course take into account the findings from the Delegated Powers and Regulatory Reform Committee’s report and we will review accordingly.”—[Official Report, 19/1/22; col. 1712.]


I know we are all sitting here waiting to see if any of those will be enacted, and I very much look forward to the Minister’s response. The words of the DPRRC have been quoted but it is worth putting on the record points 13 and 14 in its 17th report, which say that:

“We do not recall any other occasion where the Government have argued that one reason why Parliament should not be able to scrutinise delegated legislation is because the Government might be defeated on it … Neither have the Government cited any precedent where the ability to disapply a legislative provision (here, the Bill’s subsidy control requirements) can be achieved by a direction that can be kept secret from Parliament.”


With that, I look forward to the Minister’s response.

--- Later in debate ---
Lord Fox Portrait Lord Fox (LD)
- Hansard - - - Excerpts

My Lords, those on this side welcome these three amendments. It is always hard to get those first government amendments out; after then, you can keep them coming, Minister. We have one or two suggestions about what you might like to put in them.

It is good to have a consistent approach; indeed, a consistent approach to how you value a subsidy is a good starting point. Perhaps we can then have a consistent approach to how local authorities evaluate the need for a subsidy, and to how they are regulated and managed within areas. Consistency is what we are calling for. This is clearly the first baby step towards having a control system operated from a level playing field.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

I echo the points of the noble Lord, Lord Fox: it is interesting to see government amendments at this early stage, even though none of these issues was raised at Second Reading. Likewise, we are not going to oppose any of these amendments.

Similarly, not just on consistency but on transparency, a good number of amendments were tabled in Committee on which we are more than happy to work with the department and the Minister to bring them back on Report. This will hopefully deal with a number of issues on which we have concerns, so that we do not object to them at that point.

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

I am happy to see that the Liberal Democrats believe in consistency and to work with the opposition parties when amendments are required, as appropriate.

--- Later in debate ---
Moved by
21: Clause 12, page 7, line 19, leave out subsection (2)
Member’s explanatory statement
This amendment would require individual subsidies given under a subsidy scheme to be judged against the subsidy control principles.
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, we understand the Government’s desire to keep the subsidy control regime as straightforward as possible so that public authorities at all levels can respond to events as they arise. The Minister knows that we generally support these aims but, as we made clear at Second Reading, we have real concerns about the lack of transparency and accountability. The three amendments in this group have been tabled to look at that. The issue of transparency concerns individual subsidies given under a subsidy scheme not showing as transparently as others on the database or elsewhere.

Amendments 21 and 24 would require individual subsidies inside a scheme to be judged against the subsidy control or energy and environmental principles, as appropriate; I thank the noble Baroness, Lady Sheehan, for putting her name to Amendment 24. The Minister may tell us that removing both Clause 12(2) and Clause 13(2), as the amendments outline, is unnecessary, as Clause 12(3) and Clause 13(3) state that the schemes should not be made unless an authority is “of the view” that the individual subsidies “will be consistent with” the principles. However, being “of the view” that something is consistent with the rules is not the same as specifically stating it or judging that it has been defined within the rules.

More importantly, the lack of transparency arising under the subsidy schemes could be vast. Individual subsidies—large amounts of money or support—could be hidden; they would not be shown and would not be transparent if they are within the schemes. The first two amendments look to set that out.

--- Later in debate ---
Baroness Bloomfield of Hinton Waldrist Portrait Baroness Bloomfield of Hinton Waldrist (Con)
- Hansard - - - Excerpts

I understand the point the noble Lord is making, but I suggest we would do better to continue this discussion with officials, and come back to him and to the whole Committee in writing.

Making individual subsidies granted in line with the terms of a subsidy scheme eligible for review by the tribunal would undermine a key benefit of creating a scheme—which, as I was saying, would be the administrative simplicity for public authorities, including the security that subsidies can be granted under the terms of a scheme without additional challenge or assessment. However, I fully recognise noble Lords’ underlying concern that schemes could be used to shield unlawful subsidies from challenge. If a subsidy purports to be part of a scheme but does not comply with its terms, an interested party may indeed bring a challenge. This would be on the basis that the subsidy should not enjoy the protection of the scheme but was instead a stand-alone subsidy where the public authority did not consider the subsidy control principles.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

On that point, how would another business or organisation know the subsidy existed if it was part of the scheme?

Baroness Sheehan Portrait Baroness Sheehan (LD)
- Hansard - - - Excerpts

May I intervene too, on the same point? If a business does know about a subsidy and thinks it is unfair, it cannot go to the public authority and ask for a review. The bar is so high that the review can only be at the level of the scheme—which the business had nothing to do with designing. The public authority would have to do it. The business has no comeback.

Baroness Bloomfield of Hinton Waldrist Portrait Baroness Bloomfield of Hinton Waldrist (Con)
- Hansard - - - Excerpts

Every grant made over £500,000 will be visible. Noble Lords may be arguing that that bar is too high, but maybe we will come to that at a later stage.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

The fundamental point remains: how do people know that the subsidy has been given if it is part of a scheme? They cannot challenge it.

Baroness Bloomfield of Hinton Waldrist Portrait Baroness Bloomfield of Hinton Waldrist (Con)
- Hansard - - - Excerpts

If it is over £500,000 it will be visible.

As I was saying, a challenge would be on the basis that that the subsidy should not enjoy the protection of the scheme but was instead a stand-alone subsidy where the public authority did not consider the subsidy control principles. The CAT could be asked to determine that question. If the CAT finds that the subsidy ought to have been treated as a stand-alone subsidy, it could also be asked to determine whether the relevant subsidy control requirements had been met.

It is also important to note that subsidies given under the schemes may be subject to other obligations and other forms of challenge. A public authority that gives a subsidy in breach of its general public law duties may be challenged through the judicial review process in the general courts, even if the subsidy is given under a scheme. And of course, if the scheme is substantially changed beyond the parameters set out in Clause 81 on permitted modifications, it must be reassessed and uploaded to the transparency database, and can again be challenged. For the reasons I have set out, and with the caveat that we shall return to some of these questions, I ask that, for the moment, the amendment be withdrawn.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

As we have said in the back and forth of the discussion on these three amendments, there are still a number of real concerns about the subsidy schemes: how they operate and, more importantly, how they can be challenged and dealt with. I will withdraw Amendment 21 at this stage, but I seek some conversations with the department and the ministerial team before we progress to Report.

Amendment 21 withdrawn.
--- Later in debate ---
Moved by
37: Clause 32, page 17, line 8, at end insert—
“(aa) the subsidy database and its contents are subject to routine audit, and” Member’s explanatory statement
This amendment would require regular audits of the subsidy database to ensure its contents are of appropriate quality.
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, I shall speak also to the other three amendments in this group. Without wanting to do the Minister’s job for him, let me start by acknowledging that there is a rolling programme of improvements to the subsidy database which I think all sides would acknowledge does not yet meet the standards one would expect a database of this importance to meet. Irrespective of that rolling programme of improvements, the introduction of a new subsidy control regime affords us an opportunity to look again at how subsidies are reported by public authorities so that they can be looked at by possible economic competitors and the public at large and be held to a higher account. The most obvious and effective way of ensuring the database fulfils its purpose is to ensure that it is subject to periodic audits with any recommendations being acted upon within a reasonable timeframe. We see no reason why the Minister would not want to accept Amendment 37. As the Government have freely admitted, the quality of the data has not been sufficient.

I turn to Amendments 44, 45 and 46. I thank the noble Lord, Lord Fox, for putting his name to them. Amendment 44 would require relevant authorities to include in the entry to the database the exact date on which the information was submitted. One of the fundamental differences from the previous scheme, the European state aid scheme, was that agreements were made before the scheme came into effect. The flipside of this is that that obviously speeds it up, but the schemes or the subsidies will already be in place. Putting into the database the specific date on which the information was submitted will again help with the transparency around it. It is hard to think of any case against such a requirement so I hope the Minister will be able to confirm that. It increases transparency and provides clarity for those gathering the information from the database. It may also allow identification of those authorities that are particularly good or bad at submitting their entries.

Amendment 45 would require information on domestically sourced content to be posted on the database. While Clause 17 prohibits subsidies contingent on the use of domestically produced content, nothing in the WTO provisions or elsewhere, including the TCA, would prevent basic reporting requirements. Some organisations, including the GMB trade union, believe that regular reporting of the use of domestic content could drive—but, importantly, not compel—contractors to make better use of UK supply chains. Indeed, in specific cases such as steel procurement, the Government have set a benchmark of 60% domestic content for the offshore wind sector, so some of these requirements already exist. Putting them inside the database and shining a light on them could help encourage more.

Finally, Amendment 46 would require authorities to demonstrate the terms and conditions of their subsidy schemes. When I first read it, I thought Amendment 46 may well have fitted into the group we dealt with three groups previously, but because it is relevant to the database it probably sits within this debate. The argument, however, is very similar to the debate we had three groups ago.

All the amendments are intended to improve the quality of the database and the amount of information available to practitioners operating in that field. Interestingly, Chapter 3 of the Bill is headed “Transparency”, so a bit more transparency may help.

One point not covered by the amendments, but to which we may well come back, is that the chapter on transparency, especially Clause 34, uses the word “may” a lot. To take one example, Clause 34(3), at line 28, says:

“In relation to subsidy schemes, the regulations may require a public authority’s entry to include”.


When the Minister responds, I wonder whether he could give us just a bit more detail. These are partly probing amendments but, on the use of “may”, when would those regulations and requirements on the public authorities have to be followed and when would they not have to be followed? Again, I think the use of “may” in there does not help. With that, I beg to move.

Lord Fox Portrait Lord Fox (LD)
- Hansard - - - Excerpts

My Lords, I rise to speak to Amendments 44, 45 and 46, to all of which I have added my name. It is a pleasure to follow the noble Lord, Lord McNicol. Amendment 44 requires the date a subsidy scheme is entered into to be put into the database, Amendment 45 is about domestically sourced content and Amendment 46 is about other areas of specifying the date. All three of these amendments come together to play to the word that we have been using in these groups, which is “transparency”.

I shall briefly focus on Amendment 45 because it is an interesting point. The nature of what we are talking about hinges around Clause 17(1), which I assume is a WTO-driven point that we cannot favour domestic content over external content. I accept that we need to follow WTO rules. However, as the noble Lord, Lord McNicol, said, that does not stop us collecting the data. Why collect the data if you do not have an actionable need to use it? Therefore—never mind the subsidy that is running, for which we are collecting the data—if it turns out that all that subsidy leads to imports only rather than domestic benefit to the supply chain, when we come to extending or repeating that subsidy or using it in a similar way in another sector, I assume that it is perfectly legal within WTO for the Government to take the benefit and the learnings of that data, having of course given themselves the power to collect it through Amendment 45, to modify future schemes which would still be legal within WI and benefit the domestic supply chain. WI? Jam for all. I meant WTO.

It is a legal question. The Minister may not have the answer straightaway. That data having been collected, I assume, and I would like confirmation, that it is perfectly legal to use that data to design repeat or future schemes so that the UK economy benefits more from that subsidy. That is my main question on these amendments.

--- Later in debate ---
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

I thank the Minister for his response. It was really nice to hear him agree with many of the points that we raised. I just need to encourage a bit more of a hard commitment to amend the Bill, rather than a verbal agreement. I do not think anyone on this side was arguing in favour of prohibition. I was simply outlining the idea of getting the information on to the database, not about using it for a prohibition. No one was arguing that point. As for the changes, I suppose I should take one out of four, but I hope we will be able to bring forward some more. I beg leave to withdraw the amendment.

Amendment 37 withdrawn.

Subsidy Control Bill

Lord McNicol of West Kilbride Excerpts
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

I thank the Minister for giving way. Just on the point about challenge and that if a subsidy is below the £500,000 it will be part of a scheme, I think he said before that if it was given as part of the subsidy scheme, it would have to meet the seven principles; it would be good if that could be clarified. Probably more importantly, however, is whether a one-off subsidy that is less than the individual subsidy limit—the £315,000—has to meet the principles. My understanding from some of the earlier discussions in the other place is that that was not confirmed or clarified. Can the Minister clarify whether a subsidy that is less than £315,000 has to meet the seven principles or the other energy principles?

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

Yes, of course. All subsidies need to meet the principles—this discussion is about what parts of those are published. If a subsidy is awarded under the scheme, then the scheme principles would also need to comply with the subsidy control principles.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

So, just to be absolutely clear, if a subsidy is awarded that is less than £315,000 as an individual subsidy, it says in the Bill that it needs to meet the seven principles and possibly the energy principles.

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

My understanding is that, yes, that is the case. If that is not correct I will certainly clarify that to the noble Lord, but my understanding is that that would be the case.

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

Just to clarify the points from the noble Lord, Lord McNicol, yes, it would need to meet the scheme requirements if it was given under a scheme. If the subsidy is not minimal financial assistance —so it exceeds £315,000 accumulated over three years—it does have to meet the principles; if it is MFA, it does not need to meet the principles. Reviewing the cost as an impact assessment does not necessarily cover all those options.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

So, if it is under the £315,000—sorry, forget the scheme, I confused things by talking about the £500,000 for the scheme. If an individual subsidy is less than £315,000—this is quite important for transparency—it does not have to meet the principles that are laid out in the Bill?

--- Later in debate ---
Moved by
40: Clause 33, page 17, line 24, leave out “one year” and insert “three months”
Member’s explanatory statement
This amendment would require subsidies or schemes to be entered in the database within three months of being made, rather than one year, if given in the form of a tax measure.
--- Later in debate ---
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, I am just waiting for the noble Lord, Lord Lamont, to rejoin us as he has helpfully signed these amendments with me. I shall also speak to Amendments 41, 42 and 43. This is a straightforward group of amendments that, along with the next two sets, deal with the whole issue of transparency. I am grateful to the noble Lord, Lord Lamont, for signing these four amendments. The Bill is interesting in that it throws up some unusual alliances, but that should make for an infinitely better piece of legislation by the end of this process. As we heard in the last group, these are not party-political issues; they are issues aimed at improving the legislation.

--- Later in debate ---
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, this is a straightforward group of amendments and I thank the noble Lord, Lord Lamont, for signing them. My very first reading of these clauses left me with a real sense of confusion and, while I have tried my very best to get into the head of the Minister, or at least those drafting the Bill, I am not sure I have achieved that.

Amendment 40 would require subsidies or schemes to be entered in the database within three months of being made, rather than one year, if given in the form of a tax measure. Amendment 41 would require subsidies or schemes to be entered in the database within one month of being made, rather than six months, if given in any form other than a tax measure. Amendment 42 would require that modifications to subsidies or schemes entered into the database are made within three months of that modification, if given in the form of a tax measure. The final one, Amendment 43, would require that modifications to subsidies or schemes entered into the database are made within one month of that modification, if given in any form other than a tax measure.

This proposed new system is fundamentally different from the previous EU system of state aid and, more importantly, different from pre-authorisation of the subsidies. All parties have welcomed that change, and we do on these Benches; however, the proposed new system of post-award disclosures, monitoring and/or possible challenges will work only if there is complete transparency, or at least a nod towards transparency, be that, as we heard on the previous group, on the amount or, on this group, on timing, or, in future groups, under systems that are put in place to allow those challenges. These amendments are important as the balance in the Bill as it is written does not feel right—the balance between those being able to challenge or look at our businesses or organisations and see what is out there and those who will have already received those subsidies.

As it stands, authorities are being afforded between six months and a year to make their entries to the subsidies database, depending on the form of relief they are offering. Much of the public sector, as we heard in the previous debate, is accustomed to fulfilling transparency requirements within a month of the end of a quarter, so these amendments, similar to the financial ones, are already being adhered to. The financial management through local authorities already adheres to very similar systems to what we are looking to amend here. One might have some sympathy for the Government’s approach if they were equally as generous in the time given to refer matters to the Competition Appeal Tribunal, the CAT, but as we will discuss later, this is not the case. The time limits on appealing are tighter.

Last Wednesday, the Minister rightly took pride in the number of changes being made to the subsidies database, arguing it was now simpler than ever for public authorities to meet their reporting requirements. If that is the case, why would somebody be given a full calendar year to upload their reporting of subsidies? We do not accept that reducing the time limit would place an unacceptable burden on authorities; we believe it would greatly assist efforts to improve transparency and ensure proper accountability for decision-making.

On 26 October, at the first witness session in Committee in the other place, Professor Rickard said on this issue:

“I think six months is too long. If it is a tax break for 12 months, after 12 months a competitor might be out of business”.—[Official Report, Commons, Subsidy Control Bill Committee, 26/10/21; col. 21.]


This group of amendments would rebalance a perceived or real inequality between those receiving the subsidy and those who may be affected by it, and their ability to challenge that subsidy. I beg to move.

Lord Lamont of Lerwick Portrait Lord Lamont of Lerwick (Con)
- Hansard - - - Excerpts

My Lords, I added my name to these amendments in the name of the noble Lord, Lord McNicol. I shall not weary the Committee by repeating the points that he made, but I strongly agree with him. I added my name just because I was puzzled and regard as unfair the imbalance between the time given to public authorities to list subsidies and the very short timetable for people to object to them. I do not see why it should take six months to make public what has been done, while one month seems an extraordinarily short time for somebody to challenge it. As may have been said when I was unfortunately out of the room trying to get on PeerHub, one could easily imagine circumstances where perhaps the website was not working very well, and a few days were missed. “It never happens,” the Minister says. Well, we shall see. That would be a first in public sector computers.

There seems to be an imbalance here. What is sauce for the goose ought to be sauce for the gander—or is it the other way round? Six months is certainly far too long and one month is far too short. I agree with everything that the noble Lord, Lord McNicol, said.

--- Later in debate ---
It is also worth noting that the consultation we carried out in 2021 included the approach we have now taken in the Bill, including the six-month deadline. Of the responses we received to it, 74% agreed with the Government’s approach, which suggests that respondents agreed with our proposed balance between speed and accuracy. In the light of that, I hope the noble Lord will feel able to withdraw his amendment.
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

Before the Minister sits down—I ask this as I genuinely do not know—he stated that 76%, or however much it was, of those who responded to the consultation supported the deadlines of six months and a year. Does he know what the consultation said about the other side of this, with regards to the timescales for challenge?

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

The figure I used was 74%, not 76%. I do not have that information, but I can certainly get it for the noble Lord—I will supply it in writing.

--- Later in debate ---
Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

The position in the clause is fairly transparent; they will be able to ask for information on the scheme and the authority would have a duty to provide it. That is separate from the provisions for uploading it to the database.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, I thank the Minister for his response. As the noble Lord, Lord Lamont, picked up, he very much focused on Amendments 40 and 42, rather than Amendments 41 and 43. The Minister is absolutely right that there will need to be a balance between bureaucratic burden and proper transparency and oversight. As the Bill sits just now, I do not believe that the balance is in the right place. I am sure that we will come back to this—after the Division.

--- Later in debate ---
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

I had nearly finished. I reiterate that we are going to have to come to some sort of agreed position on the bureaucratic burden, which the Minister understandably comes back to, and the issues of transparency, fairness and proper oversight. The last place we want to be is a situation where the Bill—as we believe it does as it is written just now—leaves open the possibility of some businesses being supported and those subsidies unable to be challenged properly. I beg leave to withdraw the amendment.

Amendment 40 withdrawn.
--- Later in debate ---
Lord Purvis of Tweed Portrait Lord Purvis of Tweed (LD)
- Hansard - - - Excerpts

My Lords, it is a pleasure to follow the noble Lord. I was thinking that it is not usual for us to have difficulty hearing what the noble Lord, Lord Dodds, says: it was down to technology and I am glad it got sorted. I welcome his amendment because it is another opportunity for the Minister to address these serious points. As the noble Lord indicated previously in Committee, on my Amendment 53, we have tried, as the noble Lord, Lord Empey, asked us to do, where there are difficult areas, to navigate a way forward. Because he is absolutely right: before his resignation, the noble Lord, Lord Frost, said in the Chamber—I think it was in reply to the noble Lord, Lord Hannan—that the Government’s intention was not to replace the protocol but to improve it.

So, we are in a situation where the noble Lord and I come, perhaps, from a different starting point but reach the same conclusion: we find ourselves in an undesirable situation but it is one of the Government’s making, and if there are ways to ameliorate the position, the Government have to come up with the solutions, because what is not really in question, as the noble Lord, Lord Empey, said, is that the Government are not looking to replace the protocol. We are, then, tasked with trying to remove one of the barriers that the Department for the Economy in Northern Ireland has indicated, which is that uncertainty is itself a barrier, and that has to be recognised. That uncertainty is ongoing, which is already one of the damaging impacts, as the noble Lord, Lord Dodds, indicated.

We are, I think, in month four now of a three-week process that Boris Johnson promised to Jeffrey Donaldson of a short, sharp negotiation on the protocol. Four months in, it might just be that Boris Johnson is not so reliable in the commitments he gives—it is a suspicion of mine, but it may well be the case. Nevertheless, as the Minister, the noble Baroness, Lady Bloomfield, indicated to me last week in Grand Committee, when I asked if it was the case that, if the Government secured everything they asked for in the negotiations, then EU state aid rules will continue to apply:

“To respond to the concern of the noble Lord, Lord Purvis, that state aid rules would continue to apply even if the UK’s negotiating position were accepted, these are specific and limited circumstances. I trust that this will allay the Committee’s concerns on this important issue.”—[Official Report, 2/2/22; col. GC 244.]


It really comes down to “specific and limited”. “Specific and limited” will mean that there is the ability for reach-back. It will mean that, for parent companies, the guidance will stand that they will now have to start to run two sets of accounts. It will mean that there will be dual reporting, depending on whether it is state aid or subsidy control. It will mean that there will potentially be dual challenge mechanisms. It will mean that the CJEU will still define the state aid component elements of it. Whether or not there are streamlines, whether or not it is more efficient, whether it is less bureaucratic, as the Government’s Command Paper said, or whether it is “specific” or “limited”, it still means that it is different; it still means that it is not the UK approach. That, I think, is symbolic, but it is also important in content.

I will not use any of the language of “territorial nature” et cetera; that is not for me to say. I will close with one element, though. In the 100-page document The Benefits of Brexit, there is not a single independent reference to Northern Ireland at all. That was published on the day that the Northern Ireland First Minister resigned. We are in difficulty, Minister, and I think that taking what has been offered by some as a way of making the situation better is something the Government should consider very carefully indeed.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, it is a pleasure to follow the noble Lord, Lord Purvis, and his detailed analysis, especially picking up and bringing back some of the issues from last week. With his contribution and the others, I will be short. I am grateful to the noble Lord, Lord Dodds, for tabling this probing amendment and facilitating discussion on this hugely important topic. I will focus my short remarks on the bigger picture rather than the specific details, which I think have been covered well enough.

Regardless of where people stand on the Northern Ireland protocol and the Government’s negotiations to reform it, it is a part of international law, as we have heard. This legislation therefore needs to be consistent with it. There are different legal opinions on the matter and, while some are favourable to Her Majesty’s Government’s approach, others suggest that decisions relating to Northern Ireland will at best be complex but at worst be subject to challenge or litigation. Neither of these outcomes would be good for firms, businesses or the authorities operating in Northern Ireland.

When this Bill was in the Commons, the Government were asked if they would pause to allow room for negotiations to continue. The answer was no. Despite the passage of those months, we appear to be no closer.

With that, I will leave my comments and look forward to the Minister’s response.

Lord Lamont of Lerwick Portrait Lord Lamont of Lerwick (Con)
- Hansard - - - Excerpts

My Lords, without endorsing what the noble Lord, Lord Purvis, said, I think this is a very important issue—without going into the wider Brexit questions to which he referred—and it is extremely worrying.

I would like the Minister to confirm whether the Government’s position as stated in this Bill, and which was reaffirmed by my noble friend last week when she replied to the debate, is the final interpretation or is an interpretation that is subject to change. As the noble Lord, Lord McNicol, said, there are different legal interpretations of the protocol, and there certainly seem to be different interpretations between the European Union and the UK Government. Does that not therefore affect the assurances that Ministers can give? What certainty can be attributed to the opinion of Ministers as to what is the meaning of subsidies under Article 10 or subsidies under Article 138, and which subsidies are subject to European Union law and which are not?

Last time, I raised with my noble friend Lady Bloomfield the question of reach-back and what would happen if a subsidy was being given to a company in the north of England that was exporting goods to Northern Ireland and whether that would come under the EU regime or the UK regime. She replied by saying:

“The Commission’s … declaration of December 2020 made it clear that Article 10 could affect a subsidy in GB only”—


I stress the word “only—

“if there was a genuine and direct link in Northern Ireland. This would be the case if, for example, the beneficiary had a subsidiary in Northern Ireland.”—[Official Report, 2/2/22; col. GC 244.]

Is that the only case? If there were no subsidiary, would that be a different outcome?

--- Later in debate ---
Lord Whitty Portrait Lord Whitty (Lab)
- Hansard - - - Excerpts

My Lords, I add my voice to the concern about how agriculture is being treated under this Bill. Of course, under the old European system, agriculture was excluded because all agriculture subsidy had to be consistent with the common agricultural policy. We are now moving into a situation where all four nations of the United Kingdom are considering how to change their agricultural policy from one being primarily to produce food on a competitive and effective basis to one that, while food production will still be important, also makes its contribution to the environmental demands, in particular in carbon reduction and management of water and soil.

That is very different from many of the other industries that will operate under this regime. We have a multiple problem here with agriculture. We have no previous history of consistency—well, the consistency was at the European level—and all other aspects were always devolved. We are going to have four different approaches to the new era in agriculture and all of them in their different ways will have a very heavy environmental dimension, so that the way in which the land is managed provides nature-based solutions to reducing carbon and to producing a food balance within the population that is more conducive to reducing carbon and for water and soil management.

Agriculture’s total exclusion from the regime—as this amendment appears to suggest—may not be necessary, but special treatment will be necessary. Before this Bill passes this House, I hope that the Government will respond by indicating that there will be different treatment for agriculture and respect for the four different nations and their different approaches.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, it is a pleasure to follow my noble friend Lord Whitty. I agree with all his comments. I am grateful to the noble Baroness, Lady Randerson, for tabling this amendment to enable further and deeper discussion on another of the many concerns that were raised by colleagues across the House at Second Reading.

As we have already debated, although relatively briefly, the new subsidy regime will operate alongside certain legacy schemes, including, but not limited to, basic payments given under the EU’s common agricultural policy. As we have heard, the Government’s decision to include agriculture and fisheries in the scope of the new subsidy regime is an interesting one. BEIS asserts that there is logic in applying the same rules across the board. While that might make sense in some areas, doing so raises other significant issues. As we have heard from my noble friend Lord Whitty, agriculture is fundamentally different and therefore so are the issues relating to the subsidies and the subsidy control systems. That is before we even touch on the issue of devolved responsibilities.

As we know from many hours following debates on the Agriculture, Fisheries and Environment Bills, these are areas of devolved competence. Some of those matters have been addressed in discussions on the UK-wide common framework arising from the Brexit process. However, due to Her Majesty’s Government’s treatment of subsidy control as an entirely reserved matter, there is no common framework on this topic, something that we have already touched on in Grand Committee and will be returning to in later groups.

Specific nations and regions of the UK have very different interests from those of their neighbours. Public authorities will of course be able to do what they deem appropriate in the context of overarching subsidy control principles, but this is one of the areas where we may end up seeing subsidy battles and/or legal appeals. If we can reach agreement in your Lordships’ House, then we may be able to reduce the chances of some of that happening. One potential solution to some of these issues may be for the Secretary of State to establish one or more streamlined subsidy schemes covering agriculture. I ask the Minister: is that one of the department’s intentions?

I want to ask a couple of practical questions that have been subject to initial exchanges between my advisers and the Minister’s office. I thank her office for that information, but it raises some questions. Is it the case that schemes already made under the Agriculture Act, for example, will be treated as legacy schemes for the purposes of this legislation? If the environmental land management scheme, which has already been rolled out, is treated as a legacy scheme but the Defra Secretary of State later introduces a separate agricultural scheme using powers under either Act, will that new scheme be subject to the subsidy controls? If the answer is yes, will that not make it harder for everyone involved to keep track of which requirements apply and when? If so, how exactly does the decision to include agriculture in the new subsidy control regime meet the target of making the new process more straightforward and less burdensome?

A number of other issues arise around devolved authorities, many of which have been touched on. We will come on to them when we look at the CMA but, if we do not make changes to the Bill as it is currently written, we could end up with a situation in which the devolved authorities have responsibility for these delegated areas but no oversight in the Bill—no engagement with the CMA or the subsidy advice unit—and will not be at the heart of the decision-making. I look forward to the Minister’s response.

Lord Fox Portrait Lord Fox (LD)
- Hansard - - - Excerpts

My father spent half his working life milking other people’s cows and the other half milking cows in a small, tenanted farm. Farming is a way of life across the United Kingdom. You must be committed to it to make it work, so people are anxious when they see this subsidy scheme in such turmoil.

At Second Reading, the Minister said that including agricultural subsidies in the subsidy control regime would

“help to protect competition and investment”—[Official Report, 19/1/21; col. 1749.]

in agriculture and fisheries. First, will the Minister acknowledge that the agricultural subsidy scheme has much wider objectives than simply competition and investment? There is a range of social and other economic benefits that the schemes are supposed to be designed to protect. Secondly, how does including agricultural and fisheries subsidies in the subsidy control regime protect competition and investment better than leaving them where they are: outside the scheme?

--- Later in debate ---
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, I think we will have a hard stop at 7.45 pm, so I will try to be brief. Even then, though, I am not sure that we will get through everything. Obviously I am grateful to the noble Lord, Lord Lamont, for tabling his amendments in this group; they sit very nicely with my amendment.

There are some general concerns over whether the CMA is the appropriate body to undertake all this work but, putting that to one side just now, it seems counterintuitive not to give the responsible regulator the ability to initiate its own investigations—especially because, as the noble Lord, Lord Lamont, rightly said, this is a very permissive regime in terms of how it has been pulled together. It is fundamentally different from the European state aid regime and we expect it to be policed by competitors and citizens, and that is only if they have checked the database and if the subsidy has been of a high enough level to make it on to the database—more than £315,000, I think. Even then, they will be able to make those challenges only within a tight timeframe.

On the amendments, although my Amendment 61 is quite detailed, again, we really are not precious about the wording in it or who has oversight, whether it is someone from our own Benches or those of the noble Lord, Lord Lamont—or even if the Government themselves wish to bring an amendment to look to give the CMA, as an independent body, more powers to follow through and ensure that transparency is actually there. My amendment would give the CMA the power to conduct post-award investigations in cases where it believes, God forbid, that a public authority has failed to comply with the requirement. With that, I end my remarks and look forward to the Minister’s response.

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

I am grateful to noble Lords. I know that time is getting on; hopefully I will have a chance to get through my remarks in the time we have available. This is an important debate and I recognise that, if it were not for the time, other noble Lords might also have wanted to intervene on the role of the Competition and Markets Authority in this new subsidy control regime.

I listened with particular interest to my noble friend Lord Lamont’s reflections on subsidy. In response, I would say that it is important to emphasise that the Bill does not, of course, replace our gold-standard mechanisms—my noble friend may have been responsible for many of them—for managing public money and for the transparency and scrutiny accorded to the UK Government’s spending decisions. I also note that we addressed the concept of market failure in the illustrative guidance we sent round; we believe that it is a fundamental part of the guidance that will be published before the regime comes into force.

Before I address the amendments, let me take this opportunity to lay out why we have taken the approach we have in the Bill as it stands; I hope that this will address the concerns of the noble Lord, Lord Purvis. We start from the knowledge that public authorities, in my view, take their statutory obligations seriously. The subsidy control principles and other requirements are straightforward and sensible, and we expect the vast majority of public authorities to comply with these requirements in giving the overwhelming majority of their subsidies. This regime empowers public authorities to make subsidy control decisions without excessive bureaucracy or regulation of the kind that I think most people accept is found in the EU state aid system and nowhere else in the world.

With this in mind, we proposed the functions of the subsidy advice unit set out in the Bill for two closely related reasons: first, to support public authorities in giving the subsidies that are most likely to be distortive; and, secondly, to ensure that those subsidies are subject to additional scrutiny and transparency before they are given. As the noble and learned Lord, Lord Thomas, set out, we think that this is an extremely important role. Once a subsidy or scheme has been referred, the subsidy advice unit will not attempt to replicate the role of the public authority in giving that subsidy in the first place or deciding whether or not to give a subsidy. Of course, it will also not replicate the role of the Competition Appeal Tribunal in applying the law to every aspect of the case. The subsidy advice unit will not carry out its own independent evaluation of the impacts of the subsidy; nor will it come to a definitive judgment on the public authority’s legal assessment of whether the measure is a subsidy, to answer the question from the noble and learned Lord, Lord Thomas.

--- Later in debate ---
Amendment 55A and so on would allow the call-in powers currently provided to the Secretary of State to be exercised by the SAU as well. I recognise noble Lords’ concerns that the system gives too great a responsibility to the Secretary of State—
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, rather than rush through, let us finish here. I am sure there are some issues that we would go into if there were not one minute remaining.

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

Do we have time to finish?

Lord Fox Portrait Lord Fox (LD)
- Hansard - - - Excerpts

I think we are comfortable starting again on Wednesday and giving this proper time.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

The noble Lord, Lord Lamont, has yet to respond as well. It will not take long on Wednesday.

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

So shall we finish at this point and start again on Wednesday. Is my noble friend Lord Lamont available for the next Committee session on Wednesday afternoon? We are talking about suspending at this point, because we have run out of time, and returning to this group of amendments then.

Moved by
64: Clause 68, page 39, line 1, at end insert—
“(3A) The Chair of the CMA Board may appoint up to three non-executive members to the Subsidy Advice Unit established under subsection (1) in order to ensure that the Unit includes at least one person with relevant experience in relation to each of Wales, Scotland and Northern Ireland.”Member’s explanatory statement
This amendment would allow the CMA Chair to appoint up to three non-executive members to ensure that the Unit includes at least one person with experience in relation to each of Wales, Scotland and Northern Ireland.
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

In moving Amendment 64, I will also speak to Amendment 65. I am grateful to the noble Lords, Lord Bruce, Lord Wigley and Lord German, for adding their names to one or both of the amendments.

Just because it was touched on a minute ago by the Minister, I should say that we have received the letters. The lessons from day 3, on Monday, when the letters were received before the Grand Committee started, may well have been learned. Notwithstanding that, I thank the Minister and his department. I have not read the letters in detail because I was engrossed in the previous debate, but I want to pick up one small point in them. Obviously it is worrying that any subsidy under the level of £315,000 does not have to be entered on the database. What is even more worrying is that that subsidy does not even have to abide by the principles in Schedules 1 and 2. This gives more weight to the arguments for reducing the subsidy level and admittance on to the database, especially if the subsidies do not have to meet the principles in the schedules.

--- Later in debate ---
Baroness Bloomfield of Hinton Waldrist Portrait Baroness Bloomfield of Hinton Waldrist (Con)
- Hansard - - - Excerpts

The noble Lord makes a very interesting point. It does have operational independence, and I am sure that is something it would be able to consider.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

I thank the Minister for her detailed response. When she, the other Minister or the department reply, could the letter be shared between all those who have spoken in this debate?

I have one other question—and I do not expect the Minister to have the answer just now. She talked about a budget of £20.3 million being divided between the SAU, digital and one other body. Could we have the split between the three of them, because they have three distinctive functions, and the one we are concerned about and talking about is the funding of the SAU?

Likewise, I listened in detail but I am not clear whether I missed the point about why Clause 68(4) is so prescriptive and detailed in stating that the SAU will consist

“only of persons who are members of the CMA or its staff”.

If it is that prescriptive, it seems to rule out the points made by the noble Lord, Lord Wigley, so maybe it could be opened up a little.

The Minister, in referring to some of the concerns and issues around devolved authorities, said that the department was well aware of them. These amendments are meant to be helpful and to try to create, foster and build a better relationship—as the noble Lord, Lord Bruce, has outlined—especially as we move from European state aid to our own authorities being able to create and deliver subsidies. One hopes that there are some things in not just this small group of amendments but other groups that will help to generate and foster that better relationship between central government and the devolved authorities. With that, I beg leave to withdraw my amendment.

Amendment 64 withdrawn.
--- Later in debate ---
Lord Hope of Craighead Portrait Lord Hope of Craighead (CB)
- Hansard - - - Excerpts

My Lords, one problem that legislators always face is the inability to look with complete clarity into the future. Trying to predict with any degree of accuracy how this system will work is almost impossible. The advantage of the proposal that my noble and learned friend Lord Thomas is advancing is that if cases go to the CAT, gradually there will be a build-up of decisions that will begin to add extra guidance that we cannot provide in the legislation. This is the way the law works in many fields.

It is that aspect that appeals to me. Gradually, through a series of decisions in various situations, the CAT will be able to add an extra dimension to the way in which this system has tended to work. There is a value in this. I think the word “enforcement” is perhaps rather pointing in the wrong direction. It is more like building up decisions, a category or a case law that would act as guidance for further cases, so that one does not constantly have exactly the same problem being advanced. We would be able to say that there is a decision by the CAT that tells us the answer in that particular situation. Decisions of that kind can be helpful, and I hope very much that the Minister will see value in what my noble and learned friend Lord Thomas is proposing.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

We welcome the tabling of these two amendments, which move us on from the composition and core investigatory powers of the CMA towards enforcement or, to use the word of the noble and learned Lord, Lord Hope, “guidance” of subsidy decisions, via the Competition Appeal Tribunal. The two amendments in this group aim to achieve similar things but by different means.

In relation to Amendment 67 from the noble and learned Lord, Lord Thomas of Cwmgiedd, the CMA would have the option to refer matters to the CAT. That is a sensible proposition, and we are more than happy to support it. It seems counterintuitive to have a body tasked with investigating or looking at whether due process was followed when the subsidy was awarded, only for a separate person or entity to be left to initiate enforcement proceedings. Even if an interested party were to use the SAU’s output as a basis for referring the matter to the CAT, how much weight does the Minister think such a report would carry? As an entirely separate entity, would it be reasonable for the CAT to disregard or override any of the SAU’s findings?

Amendment 71 from the noble Lord, Lord Fox, takes a slightly different approach. It gives the CAT the powers to pre-emptively investigate subsidies if it believes that an award is not consistent with the principles of the Bill. I am more than happy to support this amendment. Whichever approach is taken, it is clear that all involved need greater clarity on how disputes will play out. I will not repeat the points made by the noble Lord, Lord Lamont, but independent enforcement will bring clearer and better oversight to the Bill.

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

I thank the noble and learned Lord, Lord Thomas, and my noble friend Lord Lamont for tabling Amendment 67. I also thank them and the noble Lord, Lord Fox, for Amendment 71. Before addressing the two amendments in turn, I will offer some context. We have discussed at length the conception of the new domestic control regime as envisaged by the Government. We have heard criticism to the effect that the regime is, in the view of the protagonists, lacking in robust enforcement.

Of course, international comparisons are somewhat beside the point for our UK-specific approach. It is worth while bearing in mind, though, that the mere fact of establishing a coherent regime for the purposes of subsidy control would place the UK somewhere near the top of the list of the most comprehensive subsidy control regimes. Outside the European Union, no other international partner or competitor will enjoy such a comprehensive and transparent approach to the regulation of subsidies.

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

This legislation was predicated in the TCA, as my noble friend points out. We are of course meeting our obligations. One of the purposes of this legislation is to meet our international obligations, not just under the TCA but with other trade agreements that we might strike as well.

In our view, an interventionist regulatory role is not necessary for the effective scrutiny of subsidies and would be detrimental to the smooth development and deployment of subsidies where they are needed. I have confidence that public authorities will take their statutory obligations under this regime very seriously and, in fulfilling those obligations, public authorities will be supported by comprehensive guidance. As a result, I do not anticipate that breaches will be by any means a common occurrence. My noble friend referred to the EU state aid regime, which is a different system, but it is revealing of public authorities’ attitudes to their obligations that since 1999, the European Commission has ordered UK public authorities to recover aid on only four occasions.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

That is because those systems are fundamentally different. The EU state aid system was a pre-authorisation, not a post-investigation or oversight. It is not comparing apples with apples, because of how the systems operate.

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

I said that it was a different regime but was pointing out the number of times that subsidy has been recovered since 1999. My point is that it is not a frequent occurrence. I totally accept that it is a different system and that they are different regimes, but it served as an example of the behaviour of UK public authorities.

In the event of such breaches occurring, a private person asking the court to review the legality of a public authority’s action is a well-established route for ensuring that those authorities do not exceed their powers or act irrationally, and for preserving the rights of the individual against the state. Indeed, it is the normal way for challenging the actions of public authorities, and that is why we have broadly replicated the judicial review process in this Bill, with some subsidy-specific adjustments and additions. I know that noble Lords sitting at the back will be much more familiar with that regime than I am.

Today and in other Committee sessions, your Lordships have asked, in the absence of an enforcer—I will not attempt to repeat my noble friend Lord Lamont’s Latin experience—who will challenge subsidies and how a potential interested party will know about a subsidy that may affect their interests.

The subsidy control requirements are not a regulatory abstraction; they are there to prevent unnecessary distortions of competition. Where a public authority has failed to assess a subsidy against the principles, there is likely to be harm. Anyone whose interests may be affected by the subsidy, be they individuals, businesses or other public authorities, including the devolved Administrations, they have standing to challenge it. The people best placed to decide whether to bring a challenge are those who are actually operating in the relevant sector and area.

Transparency declarations will provide enough information for people to assess whether their interests may be affected by a subsidy. I once again underline that every subsidy or scheme that is in scope of the main subsidy control requirements and that may be challenged in the Competition Appeal Tribunal is also subject to the subsidy control transparency requirements, with the exception of certain SPEI subsidies, as we debated the other day. For those subsidies that present a greater risk to the market, or where the public authority is less sure of its assessment, the CMA reports will provide further information still.

On the point made by the noble and learned Lord, Lord Thomas, about the costs of pursuing a challenge, in practice an interested party is likely to take legal advice before deciding to ask for a review of a subsidy, and of course that will incur costs. However, as with other kinds of legal proceedings, the CAT can award costs to whichever party is successful. The pre-action information request process will be an important opportunity for a potential interested party to find out more about a subsidy and make a decision about whether to proceed with a challenge, and then to make a decision informed by the likelihood of success, most likely following advice.

I turn to Amendment 67 from the noble and learned Lord, Lord Thomas, and the noble Lord, Lord Lamont, and I return to some of the arguments that I made in respect of the grouping we finished at the beginning of this afternoon’s session. The subsidy advice unit is an advisory body; it is intended to advise public authorities on the most potentially distortive subsidies and, by doing so, to provide a measure of additional scrutiny and transparency to the benefit of interested parties and, ultimately, the public at large. Ultimately, the SAU will shine a light on the underlying assumptions that have led to the development of a subsidy or scheme. It is for the public authority to exercise its own judgment with respect to that information. I have confidence that public authorities will take their responsibilities under this regime seriously and, where the CMA has issued a report, the public authority will give appropriate weight to the CMA’s conclusions.

In response to the question from the noble Lord, Lord McNicol, about the purpose of SAU reports, they will provide a public indication of the quality of a public authority’s assessment. It is in a public authority’s best interests to demonstrate that they have properly considered the potential distortive impacts of a proposed subsidy or scheme, and that offering such a measure is justified and proportionate to the policy problem that they are trying to address. Should a public authority fail to take proper account of the CMA’s conclusions, the report means there will be a significant amount of information about the subsidy in the public domain, beyond what would already have been required by the transparency database. Interested parties will therefore be all the more able to assess whether the subsidy may affect their interests, and of course to mount a challenge if they so wish. There may be a difference of opinion on this, but I am afraid that I just do not agree that there should be a role for the CMA in this.

In response to the Latin question of the noble Lord, Lord Lamont, about who will guard the guards themselves, I repeat that, assisted by guidance, which will help public authorities to understand their obligation—I have cited the example of a number of repayments previously—I think we can expect a high level of compliance with the regime. As the noble and learned Lord, Lord Hope, observed, the Competition Appeal Tribunal will build up a body of case law which will then be an important additional source of guidance for public authorities.

As I said to the Committee on Monday, of course I hope that no UK government subsidies would require referral, but Ministers intend to be open-minded to calling in a UK government subsidy for SAU scrutiny where that is requested by another public authority or considered desirable for other reasons. Furthermore, where necessary, the Secretary of State has the ability to refer subsidies to the Competition Appeal Tribunal. However, I would be surprised and disappointed if he or she had to challenge a subsidy made by a UK government department, but he or she could certainly do so if they felt that a subsidy risked competition and investment within the UK or compliance with the UK’s international obligations.

I turn now to Amendment 71, tabled by the noble Lords, Lord Fox and Lord Lamont, and the noble and learned Lord, Lord Thomas. This would have the Competition Appeal Tribunal refer specific subsidies to itself for decision. I would submit that that is highly unusual and would potentially compromise the CAT’s neutrality. Of course, there are practical objections to this amendment as well. As with all courts, the tribunal’s expertise, resourcing and premises are equipped for hearing cases, not for gumshoe investigatory work. I do not think that the noble Lords are really suggesting that this should be the case.

--- Later in debate ---
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

I have very little to add; it has been covered comprehensively. I was happy and pleased to add my name to Amendment 69.

We have talked a lot about equity and balance, and the final group of amendments probably has even more of the issues raised in it so, rather than repeat everything that has been said, I am more than happy to endorse it. We will then pick up the final issues around engagement and involvement with the devolved authorities and central government in the final group.

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

My Lords, before I speak to the detail of these amendments, this is perhaps a good opportunity to update the Committee on our progress in seeking legislative consent for the Bill, as we promised in our first Committee session on 31 January.

These amendments, and a number of others we have debated, touch on the UK-wide and devolved aspects of the Bill. As we have discussed on numerous occasions, subsidy control is reserved, but there are clauses in the Bill that alter the executive competence of the devolved Administrations. From the very beginning, the UK Government, at both ministerial and official level, have worked closely and extensively with the devolved Administrations in designing the new subsidy control regime. We have worked to secure their support for LCMs for the Bill. I pay tribute to my officials and those in the devolved Administrations for their ongoing efforts in this space.

Our strong preference remains to secure legislative consent, and we will keep all avenues open to achieve this and to remedy the significant concerns of the devolved Administrations. Of course, we also want to ensure the operability of the new regime. Negotiations are still in progress, but I assure noble Lords that I will keep the House updated at the earliest opportunity, without prejudicing the content of those negotiations. I also assure the Committee that, should any amendments be necessary to reflect the outcome of those negotiations, we will table them as soon as possible prior to Report to enable your Lordships’ House to consider and scrutinise them with sufficient time.

--- Later in debate ---
Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

My Lords, I thank the noble lord, Lord McNicol for this amendment, and the noble Baroness, Lady Blake, for speaking to it. I also thank the contributions of other noble Lords—and the noble Lords, Lord Fox and Lord Lamont, reflected on this issue during the Monday’s session.

An interested party, which is anyone whose interests are affected by the subsidy, may apply to the Competition Appeal Tribunal for a review of the subsidy within one month of the subsidy’s upload to the transparency database, if there has been a post-award referral to the CMA within one month of that report, or if a pre-action information request has been made within one month of the response to this request. The limit has been set at one month so that we can give legal certainty to public authorities and subsidy beneficiaries as swiftly as possible. It is important to avoid creating such prolonged uncertainty that it acts as a brake on legitimate subsidies.

We must also ensure that interested parties have sufficient time to consider a subsidy before asking the CAT to review it. That is just what this Bill does. An interested party, perhaps a competitor who is thinking of approaching the CAT to review a subsidy, can make a pre-action information request to a public authority. The limitation period is then extended until one month after the public authority has responded. Since the pre-action information request gives the public authority up to 28 days to respond, in practice, the limitation period can run for two or three months after the publication of the subsidy or scheme on this database.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

If the argument is that we are only giving one month to raise a complaint or to look into this, why are the uploading timeframes six months and/or one year? If the Government want to create legal certainty for the organisation that is giving the subsidy, surely, as the noble Lord, Lord Lamont said on Monday, what is good for the goose is good for the gander. If they want that legal certainly, deliver that within the one month in terms of the upload to the database. Then there is parity and legal certainty.

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

As the noble Lord, Lord McNicol suggested, we explored this point fully last week. There are good reasons for it. If it is a tax subsidy, the full amount might not be clear. It might be variable, based on a number of different reasons, and the fact of giving a subsidy may well be published in other transparency obligations that local authorities or the devolved Administrations already have. However, I understand the noble Lord’s point.

In response to the noble Baroness, Lady Blake, Clause 71 also makes it clear that in exceptional circumstances, the tribunal may extend the time limits for bringing a challenge. This amendment would extend the general window for bringing a challenge from one month to three months, which is too long. It is longer than the challenge periods available in other areas where business decisions are dependent on the decisions of public bodies, such as procurement and planning decisions, where the limitation periods are 30 days and six weeks, respectively. In those areas, the harmful effects of prolonged uncertainty have been recognised through the shorter challenge periods available. The same reasoning applies in the subsidy control context. If the general limitation period for challenging subsidy decisions was extended to three months, as this amendment proposes, public authorities and subsidy beneficiaries could in practice have to wait as long as five months before having reasonable legal certainty about a subsidy that they have granted.

There is a risk that this could have a chilling effect, not only on the giving of subsidies but on the timely use of them by beneficiaries. For example, a subsidy could take the form of a loan guarantee for a capital investment, such as buying new machinery. Your Lordships will appreciate that some beneficiaries may be reluctant to go ahead with purchasing that machinery for as long as there is a possibility that the subsidy decision could be quashed and a recovery order made.

The noble Baroness, Lady Blake, and the noble Lord, Lord McNicol, asked how the Government can justify giving public authorities six months to fulfil their transparency obligations but providing interested parties only one month to challenge a subsidy. I recognise the strength of feeling on the length of time on the transparency deadline and how this compares with the limitation period. During Monday’s Committee, I set out the reasons why the deadline is set at six months: it allows for better-quality data where subsidies are based on an estimate, and it gives public authorities greater ability to upload their subsidies in bulk, and therefore to reduce administrative burden.

--- Later in debate ---
Lord Berkeley Portrait Lord Berkeley (Lab)
- Hansard - - - Excerpts

My Lords, I rise to speak briefly to my Amendment 80, which is a probing amendment. It is grouped with this lot of amendments, but it is a different subject, and I will try to be as quick as I can.

It relates to Clause 85, headed “Crown application”, which provides that the Act will apply to the Crown, but excluding Her Majesty in her private capacity, Her Majesty in right of the Duchy of Lancaster, and the Duke of Cornwall. I am afraid that this continues the debate about the uncertainty of the role of the Duke of Cornwall and the Duchy. It is one little hobby-horse that I have been pursuing for many years, and I apologise for that. I refer noble Lords who want to get into the detail to the Second Reading of my Private Member’s Bill, the Duchy of Cornwall Bill, on 26 October 2018, which seems a long time ago.

Since the Duchy of Cornwall says that it is in the private sector—I am assuming that the Duke and Duchy are synonymous—why should the Duke of Cornwall or the Duchy be given special treatment in this Bill? No other big landowner or property owner is allowed special treatment. I understand why Her Majesty in her private capacity and the Duchy of Lancaster are, but the Duchy of Cornwall says on its website:

“The Duchy of Cornwall is a … private estate … established by Edward III in 1337.”


This was confirmed in the second-tier tribunal in 2016, after a Mr Michael Bruton had claimed that the Duchy was in the public sector and therefore needed to do an environmental study on putting Japanese oysters into the Helford river in Cornwall, which it owned. In the First-tier Tribunal, Mr Bruton had won, largely because the Duchy’s representative said, “To all intents and purposes, we believe we are above the law”, which is quite an interesting statement. Of course, the Duchy then appealed to the next-tier tribunal and, not surprisingly, with all the free legal advice it gets from the Government, it won. The tribunal’s decision was:

“The Duchy of Cornwall is not a public authority for the purposes of the Environmental Information Regulations 2004.”


Why should the Duchy of Cornwall be treated differently from anyone else—any of us—to whom this Act will apply? If the Minister is not able to answer that question today, perhaps he could write to me. He might want to contact the Duchy itself. I warn him that the last time I raised this, in the leasehold reform Bill debates about three or six months ago, the Minister agreed to write to the Duchy of Cornwall, the Duchy of Lancaster and the Crown Estates about the leasehold reform Bill. We got good responses from the Duchy of Lancaster and the Crown Estates but, as far as I know, no response from the Duchy of Cornwall.

I do not think that right, because the Duchy of Cornwall must have given views on this Bill and I would like to know what it said. Did it send a letter? Did the Minister have correspondence? If so, can he put it in the Library? If he did not, how was this decision made? I think it very unfair that the Duchy of Cornwall—probably uniquely among big estates in this country, whatever their rights and wrongs—should be given this special treatment, for it means an exemption to the Bill.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, I think we have a hard stop in 20 minutes, so I will be very brief. I am grateful to noble Lords who put down amendments in this group, including the Minister; I hope there will be lots more to come from the Minister. My Amendment 75 has been signed by the noble and learned Lord, Lord Hope of Craighead, and the noble Lords, Lord German and Lord Wigley, and I appreciate their support on this, as well as in the debates on many other devolution-focused amendments.

I was going to say, judging by the previous responses on the devolved authority amendments, that I did not think we would hear much change, but actually the Minister’s response to the last debate was heartening, so hopefully this amendment regarding the devolved authorities will receive the same response. I will leave it there. As we finish Committee, I note that the comments made in the DPRRC report were very telling, and I look forward to discussions with the Minister and officials between now and Report. I hope that we can address some of the DPRRC’s concerns.

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

My Lords, I am pleased to say that we are now on the final group of amendments. I have made it through thanks to the supply of copious quantities of cough lozenges, so I thank Ruth for those.

I first thank the noble Lord, Lord German, for tabling Amendment 74, the noble and learned Lord, Lord Thomas of Cwmgiedd—

Subsidy Control Bill

Lord McNicol of West Kilbride Excerpts
Lord Whitty Portrait Lord Whitty (Lab)
- Hansard - - - Excerpts

My Lords, I will say a couple of words in support of the amendment and widen it slightly. In Committee, we argued that agriculture had to be dealt with somewhat differently. Clearly, the most acute issue is those on the uplands and other disadvantaged areas. It is right that this amendment addresses that and that the Government—at least in words, if not in the Bill—accept that this will have to be the case.

There is another aspect to it. If we drive those farmers out of business and there is no farming on the uplands and other disadvantaged areas, relatively well-heeled organisations will buy that land, claim they are reforesting it or engaging in some other form of environmentally desirable activity and receive a government grant for it—but in the meantime they will destroy the communities, the culture and the whole nature of our upland areas.

I add the proviso that, as the new schemes come in, the subsidy policy will have to be reconciled with other aspects of agricultural policy. It will not be a simple area. As the noble Duke just referred to, the SIs we have seen so far do not give us any clear indication of the way that policy will develop. This will be an ongoing issue between the subsidy regime and the agricultural support scheme.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, I am grateful to the noble Baroness, Lady Randerson, for tabling Amendment 4 and wish her well in her recovery from Covid—it seems that working on BEIS Bills is a Covid-risky business for us all. I also thank the noble Lord, Lord Bruce, for introducing the amendment.

On our Benches, we have been puzzled by the Government’s decision to include agriculture and fisheries in the new subsidy control framework. These are complicated sectors already governed by their respective post-Brexit Acts of Parliament. Given the complex nature of agriculture, I imagine it will be high up on the list of streamlined subsidy schemes created by the Secretary of State or by devolved authorities with approval.

There are genuine concerns around the Government’s approach to the withdrawal of CAP funding and the seven-year transition to environmental land management schemes, ELMS. We support ELMS and the UK Government and devolved Administrations having far greater flexibility than that afforded under the CAP. Nevertheless, as the NFU president Minette Batters has made clear in recent comments, these are challenging times for UK food producers. There has been a worrying long-term trend in the agricultural sector, as my noble friend Lord Whitty just stated, with smallholdings being snapped up by ever-growing larger conglomerates. We take no issue with the bigger producers being present in the UK, but we are concerned about the ever-increasing squeeze on family farms and hill farmers, who struggle to make a living without stable subsidy support.

I am sure the Minister will tell us that this amendment would raise all sorts of unintended consequences, not least that it would fundamentally undermine the ability of the Welsh Government to support their farming sector. However, due to Her Majesty’s Government’s treatment of subsidy control as an entirely reserved matter, there is not a common framework on this topic. This was already touched on in detail in Grand Committee. Specific nations and regions of the UK may have very different interests from those of their neighbours.

Public authorities will of course be able to do what they deem appropriate in the context of overarching subsidy control principles, but this is one area where we may end up seeing subsidy battles and/or legal appeals. Ultimately, this is an opportunity for us to say that, where agricultural subsidies are given, public authorities should have particular regard to issues around the hardship and profitability concerns of smaller producers. As with Amendment 3, we do not believe this text in Amendment 4 precludes any public authority from awarding any particular subsidy; it merely adds an additional consideration to the decision-making process.

Amendment 4 may not instantly solve the problems faced by Welsh farmers, for example, but let us remember that in terms of the Welsh sheep industry something like 90% of the breeding stock fall within upland areas and 70% are in what are known as severely disadvantaged areas. These farms are a crucial part of the British landscape and, while they may not be as profitable as others, there is a public interest in preserving them. We will listen very carefully to the noble Baroness’s arguments, but at this time we are minded to support Amendment 4.

Subsidy Control Bill

Lord McNicol of West Kilbride Excerpts
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, we now come to the first mass grouping of a government concessions package. Like others, I express the thanks of these Benches to the noble Lord the Minister and the noble Baroness and the Bill team for the discussions and this good set of revisions to the Bill. There are 11 amendments in all, and as the noble Lord, Lord Fox, has said, many have been previously moved and supported by noble Lords from across the House, especially in Committee.

As we have heard, this group relates to the recommendations in the DPRRC report, which were plentiful and uncharacteristically forceful. Like everyone else, we are glad that common sense has prevailed, particularly in relation to the situation around Clause 47, whereby certain information could have been withheld from Parliament and, by extension, the public.

The concessions made by the noble Baroness in the name of the noble Lord the Minister are most welcome, but the bigger issue at play here is the frequency with which the Government have attempted to take broad powers for themselves, often without proper justification. We hope that that trend will change as we move towards a new parliamentary Session, and these concessions and these moves help to show that. Like the noble Lord, Lord Fox, we would have liked to see movement on Clause 11, on definition of schemes of interest and schemes of particular interest—but we will take these 11 amendments, with thanks.

Baroness Bloomfield of Hinton Waldrist Portrait Baroness Bloomfield of Hinton Waldrist (Con)
- Hansard - - - Excerpts

My Lords, this has been a short but constructive debate, and I welcome noble Lords’ support for this suite of amendments.

The noble and learned Lord, Lord Hope, requested a report on the obstacles to the granting of LCMs by the devolved Governments, and I am happy to make that commitment: we will bring a report at Third Reading. We also wish to note the constructive engagement of the noble Lord, Lord Fox, who has successfully picked up the mantle on the issues highlighted in the DPRRC report. I am sure that his speech made some difference, alongside the good standing of the DPRRC and our respect for its work.

--- Later in debate ---
Lord Fox Portrait Lord Fox (LD)
- Hansard - - - Excerpts

My Lords, as the Minister has set out, this group includes a number of concessions around the transparency issue. Again, we should thank him for coming some of the way towards the arguments that surfaced in Committee.

We welcome the reduction in the reporting threshold from £500,000 to £100,000. We recognise that that is some way short of the level that many external organisations were calling for and indeed that we wanted, but we also understand that it is a big step for the Government and they have come a long way towards where we think it should be.

I put my name to Amendment 20, tabled by the noble Lord, Lord McNicol, and I am looking forward to hearing his proposal. I am still not 100% convinced by what the Minister said, although he worked hard to explain to us why it would not be an issue. I think some of the points he made were right—sorry, acceptable; I am sure they were all right.

On the Minister’s first point about multiple payments to different branches, if they all have the same parent company, I start to get concerned about that issue. However, the biggest point was that if nefarious activity is going on and a £99,999.99 subsidy is being paid out by this mythological nefarious authority, the Minister said that that would no doubt surface. I am not sure how it would do so, given that there is no reporting requirement, unless that extra penny is forthcoming. Apart from sleuthing, submitting freedom of information requests and citizens’ activity, how does the Minister expect this information to surface—or indeed is he going to have an investigative unit at his side, ready to swoop on such nefarious organisations? I am interested to hear how this disclosure or uncovering process will work.

Other government amendments mean that the declaration of subsidies scheme is being improved in time terms, and that is also very welcome. The Minister was talking about a review process. I think he would be wise to maintain a rolling review in the department to be able to surface any issues and problems. This is a new process and a lot of different organisations will be trying to bed into it. The sooner that any misunderstandings or misapprehensions are understood, the sooner the department and the Government can do something about it.

In closing, I have a personal request. I probably should really understand this but I still do not: could the Minister clarify the rules regarding the declaration of subsidies awarded within subsidy schemes? I have heard different wordings at different times throughout the process, so perhaps the Minister could clarify once and for all how and if individual subsidies awarded under subsidy schemes will or will not be reported.

Overall, we are pleased with the amendments in this tranche. The Minister has moved on transparency, but we hope he will keep that situation under review with a view to more transparency in future rather than less.

Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, this group of concessions, as the Minister has outlined, is significant because of both the number of amendments and, more importantly, their text and practical effect. We are grateful to the Minister and the Bill team for their engagement on these issues over many weeks now; our discussions have been very useful, and although we have not achieved everything we wanted, as the noble Lord, Lord Fox, said, the new subsidy control scheme will be far more transparent than the Bill initially proposed. There are 31 amendments in this large group, 30 from the Government and one from me. I still think mine is a good amendment but I understand the Minister’s points, which we will come on to in a second.

The main issue is that we remain somewhat unconvinced of the Government’s argument in relation to the £100,0000 threshold. Given that many public authorities already have to publish details of spending at much lower levels—in many cases, it is £500 for local authorities—the £14 million cost quoted by the Minister to take the transparency threshold down from £100,000 to £500 would be well spent because that transparency would then sit across the whole of the subsidy controls and subsidies issued. However, an 80% reduction, coupled with the universal requirements across different subsidy types, is a clear step in the right direction.

To be fair, the noble Lord, Lord Fox, has already stolen a lot of my thunder in relation to Amendment 20. The points he made were absolutely spot on so I will not repeat them; I look forward to the Minister’s response. I tabled Amendment 20 in an attempt to deal with the potential for public authorities to award multiple payments that fall under the £100,000 disclosure threshold. As the Minister outlined in his opening remarks, there are a number of possible reasons why a subsidy may be given at that level. The noble Lord, Lord Fox, is right: it is the final one of those three points, about a nefarious reason why an individual in a local authority would encourage a local authority to give multiple awards under the reporting threshold. A fundamental question still sits there: how will we and, more importantly, businesses and organisations that are or could be affected by a subsidy, challenge it if we have no sight of it?

We would be delighted if the Minister accepted this amendment but he explained in his opening remarks why he will not. If the Government are not willing to accept it, can the Minister outline any other safeguards that could be brought in to check this possible kind of behaviour? He did not touch on safeguards in outlining the three points; his response was that the Government do not expect this to happen or do not believe that it could happen. I hope that the Minister can also confirm, because this is important, that the ministerial delegated powers to amend the transparency thresholds will not be used before—I would prefer that they were not used at all, but especially before—the CMA and other interested parties are able to see the new system in operation. We appreciate that any future increases are subject to a cap but it would make a mockery of the process and the concession package if any of the thresholds were increased before the new system was up and running and had been tested and checked by the CMA.

One area not subject to amendments today but which we see as incredibly important is the process around MFA subsidies. At present, beneficiaries in receipt of MFA subsidies must maintain paper records, which not only increases the bureaucracy involved but goes against the grain of the general transition to paperless record-keeping. We do not believe that moving this system to a digital process would require any amendments to primary legislation, so can the Minister commit today to looking at the available options for digitising the MFA process, either as part of the department’s existing subsidy database workstream or as a stand-alone project?

I will touch on one final point about the move on upload from six months to three months. Again, I fully support this. The sooner this information is uploaded on to the database, the better for all, but we still have concerns about the right to appeal against a subsidy that a business or an organisation could be affected by. That is limited to one month; the Minister and the department have not moved that to six weeks or two months. I have some concern that we could have gone a bit further. With the reduction from six months to three months, we could have increased the ability for someone—or an organisation—adversely affected by a subsidy awarded to a competitor to challenge this by giving them a little more time. I understand the Minister’s argument about wanting the subsidy to be in place, agreed and unchallengeable, before the business will spend it, because it then has certainty. None the less, we could have given a bit more time to those who could possibly be adversely affected by it to make a challenge. With that, I again thank the Minister for the 30 amendments—it is just a shame that he could not go one more and make it 31.

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

I thank the noble Lords, Lord Fox and Lord McNicol, for their relatively supportive comments. I can provide much of the reassurance for which both noble Lords are looking.

I can certainly reassure the noble Lord, Lord Fox, that the Government will continue to keep both the thresholds and the upload deadlines under review. We will carefully consider new evidence as it arises, most notably from the CMA’s regular reporting on the operation of the regime. As part of this package of transparency measures, the Government have taken the power to be able to amend these limits, as I said, via affirmative regulations. We will certainly want to see how the new regime beds in and operates in practice before we look at any changes. Of course, they are by affirmative resolutions, so I have no doubt that the noble Lord would take me to task if we did this too early.

I can also confirm to the noble Lord, Lord Fox, that subsidies given under subsidy schemes of more than £100,000 must be uploaded on to the database within three months for non-taxed subsidies, and within 12 months for taxed subsidies.

I turn to the point of the noble Lord, Lord McNicol, about how these nefarious subsidies would be discovered. If this nefarious activity is going on, it is clearly already not in compliance with the Bill and can be challenged—so there is no need to add more rules with which the public authority is then not going to comply. We believe that these subsidies will become apparent because they will lead to distortion and harms on the market.

I turn now to the question of safeguards raised by the noble Lord, Lord McNicol. The key safeguards for the regime as a whole are the existence of the Competition Appeal Tribunal enforcement process, the CMA’s regular monitoring reports and the ongoing responsibilities of my department for the successful operation of the scheme. We will carefully see how the system operates in practice and, as I said, keep the levels under review.

I turn now to the noble Lord’s point about cumulation. Cumulation is essential for the minimum financial assistance to ensure compliance with our international obligations. The Bill sets out a straightforward way for public authorities and enterprises to clarify whether the cumulative threshold has been reached. However, this process is not necessary for in-scheme subsidies. The MFA process set out in Clause 37 can be done simply and easily as part of the normal communications between a public authority and a recipient before any subsidy is given—for example, through forms, emails and tick boxes. We are committed to making this regime as straightforward as possible to ensure that funding reaches beneficiaries as smoothly as possibly, while balancing the need for transparency. Preventing misused cumulation of awards within a scheme for transparency is disproportionate, but we will also keep the operation of that under review and will seek to make it as unburdensome as possible for the various public authorities.

With that, I commend my amendments and ask that they be supported by the House.

--- Later in debate ---
Lord McNicol of West Kilbride Portrait Lord McNicol of West Kilbride (Lab)
- Hansard - -

My Lords, as we move to the final group it seems that Covid has claimed yet another victim in the noble Lord, Lord Lamont, who is unable to move his amendment. It is a shame that we get to this important group so late in the evening. If we had been here earlier, I am sure that the will of the House on Amendment 55 in the name of the noble and learned Lord, Lord Thomas of Cwmgiedd, would have been tested. At this late hour, I guess that is not going to happen. It is a shame because this group of amendments tabled by the noble Lord, Lord Lamont, the noble and learned Lord, Lord Thomas, and me are important in how the subsidy control scheme and processes will work. I am sure that those amendments would have brought more sense to the Bill, as did the amendments on transparency. I am grateful to the noble Lord, Lord Fox, for speaking to Amendments 47 and 50 on behalf of the noble Lord, Lord Lamont, and to the noble and learned Lord, Lord Thomas of Cwmgiedd, for speaking so ably to his Amendment 55.

I have tabled two amendments in this group. They both bring us back to earlier debates on the functioning of the challenge process. We continue to be concerned by the prohibition on challenges to individual subsidies made under a scheme. The threshold for successfully challenging a scheme is likely to be substantially higher than that attached to the challenge of an individual subsidy, and the Government’s refusal to move on this area suggests a determination to close the door, or at least to push it back a bit, on the ability legitimately to challenge any subsidies. I apologise for bringing up these issues on the previous group. I was getting a bit ahead of myself there.

We also do not understand why the Government have refused to move on the CAT application deadline. As I said earlier, many organisations will lack the capacity to constantly check the subsidy database to monitor the subsidies received by their competitors. This is a particular challenge for SMEs, which are unlikely to have in-house expertise on these matters but are arguably most susceptible to the impact of any economic distortions caused by a subsidy award.

The Government continue to insist that a six- or eight-week application window to bring a challenge under CAT would be an unacceptable length. From our Benches, we fundamentally disagree. An extended period would give those businesses and organisations possibly affected adversely by a subsidy more time to understand and analyse what was happening. However, with the disclosure deadline for non-tax incentives having been halved from six months to three, doubling the time for submitting a challenge to the CAT would not take us further than what was in the original wording of the Bill.

Having promised businesses, particularly SMEs, time and again that Brexit would mean the slashing of red tape, the Government continue to subject businesses to unacceptable burdens. The new subsidy control system may cut red tape in some respects, but it also imposes unacceptably high barriers in cases where a party feels wronged. We know from discussions between Committee and Report that the Government believe that affected enterprises would have alternative means of legal redress and I look forward to the Minister outlining them in his response to this group of amendments.

However, the fact remains that the entire enforcement side of this new regime does not seem up to scratch. We await the CMA’s initial report and I very much hope I will be proven wrong, but the Government will need to be prepared to revisit some of these matters if it transpires that their chosen approach is failing to ensure fairness, transparency and access to justice.

To finish on this, and to use the words that have come through on this debate, I have a modicum of comfort and delight that we are now completing the Report stage of this Bill.

Lord Callanan Portrait Lord Callanan (Con)
- Hansard - - - Excerpts

I thank all those who have contributed to the debate. It has been a good discussion, both tonight and in the previous discussions we have had on the regime as a whole and the subsidy advice unit. I particularly enjoyed the contribution from the spokesman for my noble friend Lord Lamont. This is a trend that should perhaps continue on other subjects on which my noble friend feels strongly.