Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Roborough Excerpts

Wednesday 17th April 2024 Lords Chamber

[Baroness Altmann (Con)]

My Lords, may I make a brief intervention? I did not realise that Back Benchers were not continuing to debate, so please forgive me. I have a brief point on this group of amendments and, in particular, the speech from the noble Lord, Lord Hain, on his Amendment 15. I have enormous respect and admiration for the noble Lord, but I suggest that this debate, in a way, encapsulates why it is important to consider the Bill very carefully. It also suggests the one- sided and sometimes very difficult debate that surrounds Israel and the BDS question.

For example, the noble Lord described the environmental damage involved in taking away olive trees from Palestinian land as some kind of environmental crime, but historically one of the big criticisms of Israel has been that it uses forestation projects to push Palestinians off their land, so the environmental issue can be argued in different ways for different purposes. Israel has planted over 200 million trees since it was founded, so it does take care of the environment.

On some of the arguments that the noble Lord, Lord Hain, was using, one might suggest that one wants to boycott Israel or protect the environment in the opposite way from that which is often argued, and the double standards that have been applied to this debate. I urge my noble friend the Minister carefully to consider the unintended consequences of well-meaning environmental protection. I am, of course, very keen to protect the environment and support the comments made so excellently by my noble friend about the detail of Amendment 15. I thank noble Lords for their indulgence in allowing me to make these points.

[Lord Roborough (Con)]

My Lords, before I address this group of amendments, I reassure noble Lords that the intention of the Bill is not to interfere with the ability of public authorities to campaign on environmental issues. In answer to the noble Lord, Lord Wallace of Saltaire, the Bill is well defined on this issue. It already makes an exception for environmental misconduct, including where this has been facilitated by a foreign state or as a result of the laws or policy of a state failing to prevent it.

In answer to the noble Baroness, Lady Lister of Burtersett, environmental misconduct includes conduct that caused, or had the potential to cause, significant harm to the environment and amounts to an offence under the law of the United Kingdom or any other country or territory. This is in line with the exception in the Procurement Act 2023. The Bill therefore already exempts considerations related to a range of environmental offences.

I begin by addressing Amendment 15, tabled by the noble Lord, Lord Hain. This amendment seeks to ensure that the Secretary of State cannot remove environmental misconduct as an exception to the Schedule by regulations. In response to the first of the noble Lord’s points, the Bill does not stop campaigns on general environmental issues such as fossil fuels or biodiversity. This includes where they lead incidentally to not procuring from or investing in a number of countries. I hope that this also answers the questions asked by the noble Baroness, Lady Blackstone, and the noble Lord, Lord Collins.

Environmental campaigns will be captured by the Bill only if they single out a country in a way that is influenced by disapproval of foreign state conduct. General campaigns that do not single out a specific country or territory would not be captured. However, the Bill must not leave a loophole for public authorities to take a general position on an issue mainly with the intention to target a particular state. For example, a public authority might shape a general position on an issue with the intention that it results in a boycott of Israel. The Bill should rightly stop that. If a case is flagged to enforcement authorities, they will assess the evidence of whether a public authority’s procurement or investment decision was based on a non-country-specific campaign with the intention of targeting a particular state. Enforcement authorities will have the power to ask for a range of information before making a decision.

To repeat some of the comments made by my noble friend the Minister in the previous group, I reassure noble Lords that the power in Clause 3 cannot be used to remove any exception to the ban in the Bill as passed by Parliament. This includes the exception to the ban for environmental misconduct in the Schedule. To go further, in answer to the final question of the noble Lord, Lord Hain, the limitation in Clause 3(7), which refers to

“Israel … the Occupied Palestinian Territories, or … the Occupied Golan Heights”,

does not mean that the exceptions in the Schedule cannot be used in relation to suppliers and companies with connections to Israel or the Occupied Territories. All that limitation does is restrict the power of the Secretary of State to use regulations to add further exceptions to the Bill if those regulations would have the result of removing Israel, the Occupied Palestinian Territories and the occupied Golan Heights from the scope of the Bill. I am also grateful for my noble friend Lord Wolfson of Tredegar’s comments on this, which were helpful in explaining our position.

Amendments 32A and 32B, tabled by the noble Baroness, Lady Jones of Moulsecoomb, would broaden the range of considerations relating to the environment that are exempted from the ban. The Bill already allows public authorities to make territorial considerations that are influenced by moral or political disapproval of foreign state conduct when assessing complicity in conduct that causes, or has the potential to cause, significant harm to the environment. Lowering this threshold would allow public authorities too broad a discretion to engage in the behaviour this ban aims to prohibit. These amendments would allow public authorities to boycott countries that have reduced the level of environmental protection in a country. Governments across the world frequently adjust their environmental targets. It would not be proportionate to allow an entire country to be boycotted for this reason.

An example of where the exception as drafted in the Bill may be relevant is if a prospective supplier has, or may have, engaged in environmental misconduct due to inadequate environmental protection laws in a state. The existing exception has been drafted to accord with offences under UK law, including under the Environment Act 2021. In answer to the noble Baroness’s question, I reiterate that the Bill does not apply to campaigns that do not target countries or territories specifically, including campaigns against fossil fuels or for other environmental causes. The Bill will in no way prevent public authorities setting their own environmental standards as part of their procurement or investment strategies. The Bill defines “environmental misconduct” as conduct that is an offence

“under the law of … the United Kingdom or any other country or territory, and … caused, or had the potential to cause, significant harm to the environment, including the life and health of plants and animals”.

--- Later in debate ---

[Lord Collins of Highbury (Lab)]

The Minister mentioned the Environment Act. During the passage of that Act, the limitations of due diligence measures to only significant targeted illegal deforestation were made clear because, for example, a significant proportion of deforestation due to soy in Brazil or palm oil in Indonesia could take place legally. It would be extremely difficult to distinguish between legal and illegal activity. I do not think the Minister is correct in saying that there would not be a chilling effect. Certainly, the evidence is backed up by a lot of pension experts who have presented evidence to Members of this Committee in their briefings that that is exactly what will happen: public bodies will not be pushing their ESG duties. I hope that he will understand why I have specifically raised that point.

[Lord Roborough (Con)]

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

[Lord Hain (Lab)]

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

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