Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Roborough Excerpts

Committee stage
Tuesday 14th May 2024 Lords Chamber

[Lord Collins of Highbury (Lab)]

My Lords, I put my name to Amendment 32 and I want to focus my main comments on it. The contribution from the noble Lord, Lord Verdirame, is a helpful one because he is focusing on strengthening this.

One of the problems, when we look at paragraph 8 and the implications of international conventions and the ILO, is that it is sometimes difficult to put it into concrete examples. The problem I had—and the noble Baroness, Lady Noakes, touched on this before—is when something goes into a territorial policy. I think of the debate we had on construction in Qatar and the British companies that were operating in building those sites, where the Qatari authorities were forced to have inspections by the ILO and forced to respond to a report that said their legal standards were not adequate. It could be that, at that time, a lot of investors, and perhaps even public authorities, would say that they should not be investing in companies that are adopting those sorts of laws—namely, those applied by the Qataris. Many textiles supply chains go into, for example, Bangladesh. The biggest fashion industry manufacturer is in Vietnam. The example of the Rana Plaza disaster, which we mentioned the last time we debated the Bill in Committee, required ILO intervention and British companies to say, “We will not invest”. Some of the most popular high street companies used strong leverage to get a change of policy by the Bangladesh Government. These are all legitimate concerns.

The fear is that this legislation will stop people making those sorts of decisions, or even expressing those sorts of opinions. It is that chilling effect again. Whoever replies to this debate—I thought it might be the noble Lord—should focus on the kind of concrete examples I have given, and give us an assurance that paragraph 8 includes all the things that my noble friend mentioned and that we will not have a situation where we are limited to very strict criminal things, which everyone accepts, such as slave labour and forced labour. There are lots of other examples. In the Rana Plaza example, people were forced to work in such dangerous conditions that hundreds lost their lives. Many of them were widows, leaving children to cope on their own.

It is important that we bring this debate back to some sort of reality. What are we talking about? What are the impacts of these sorts of things? We start off with a manifesto commitment on BDS, and now we are into the territory of saying that there will be a limit on what public bodies can do to ensure compliance with proper labour standards—things that this Government have been strongly advocating for.

[Lord Roborough (Con)]

My Lords, as I and my noble friend the Minister have set out in responses to previous groups in Committee, the Government take their obligations under international conventions and UN Security Council resolutions very seriously. This Bill is consistent with those obligations. I disagree with the noble Lord, Lord Wallace of Saltaire, that this Government do not take these responsibilities under international law seriously.

Amendment 30, from the noble Baroness, Lady Blower, would exempt from the ban considerations relevant to whether the decision in question would place the UK in breach of its obligations under international conventions, including the genocide convention, the Universal Declaration of Human Rights, and any UN Security Council resolution.

As my noble friend the Minister explained in an earlier group, where a judgment has been made that a party has breached international law, it is for the Government, and not a public authority, to determine the appropriate response. It is right for this Bill not to give public authorities discretion to engage in BDS campaigns based on their own interpretations of international law. I am grateful to the noble Lord, Lord Verdirame, on this point.

I will touch on the genocide convention in particular; I am grateful for the intervention of my noble friend Lady Noakes. Genocide is a crime and, like other crimes, whether it has occurred should be decided by competent courts and judges, after consideration of all the evidence available, in the context of a credible judicial process. It is the long-standing policy of successive UK Governments that judgment as to whether genocide has occurred is for a competent national or international court to determine, not public authorities.

I reassure the Committee that nothing in the Bill will prevent public authorities complying with the UK’s obligations under international conventions. It is not necessary to broaden the international law exemption in this way, and so I respectfully request that the noble Lord, Lord Hendy, withdraw the amendment of the noble Baroness, Lady Blower.

Amendment 32, tabled by the noble Lord, Lord Hendy, would broaden the existing exception for considerations that relate to labour-related misconduct. I assure noble Lords that the Government are of the view that employers who seriously violate the rights of their workforce are not fit to compete for public contracts. That is why the Bill already contains an exception to the ban for considerations made as part of an investment or procurement decision that relates to labour-related misconduct. This exception mirrors the approach taken in the Procurement Act 2023, which this House agreed in the previous Session. Public authorities can use the exception in the Bill when assessing whether a particular supplier has been complicit in modern slavery or a contract risks involving modern slavery. They must do so on a supplier-by-supplier basis, rather than by taking a blanket approach on the basis of a supplier’s country of origin. Public authorities will be able to do the same for investment decisions, assessing modern slavery risks for each investment target, rather than taking a blanket country-based approach.

Additionally, the Procurement Act 2023 provides a range of serious labour violations as grounds for exclusion. These must be considered for every supplier wishing to participate in each procurement within scope of the Act. The Act expanded the scope of the grounds on which suppliers must or may be excluded from procurements for labour violations, and added new grounds, including failure to pay the national minimum wage and offences relating to employment agencies. To reiterate, this is mirrored in this Bill. The exceptions to the Bill, just like the exclusion grounds in the Procurement Act, include considerations relating to various labour market, slavery and human trafficking offences. These are based on the serious labour offences within the purview of the director of labour market enforcement.

It would not make sense to expand the exception to the ban beyond what has already been recently agreed by the House in the Procurement Act. This would put the Bill out of step with that Act and create confusion for public authorities in scope of both this Bill and the Procurement Act.

The grounds for excluding suppliers in the Procurement Act are framed in terms of UK labour offences in our domestic legislation—and are, therefore, binding—rather than by reference to International Labour Organization conventions, to provide greater clarity to contracting authorities regarding when the grounds apply. I believe that this confirms the point from my noble friend Lady Noakes.

Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Roborough Excerpts

Committee stage
Tuesday 7th May 2024 Lords Chamber

[Lord Shipley (LD)]

I understand the noble Lord’s point. I am quoting from the Member’s explanatory statement which is part of Amendment 19 in the Third Marshalled List of Amendments.

[Lord Roborough (Con)]

My Lords, I am sorry to disappoint your Lordships’ Committee after so many questions asked of my noble friend the Minister. But I am the Minister representing His Majesty’s Government on this group of amendments. I am grateful to the noble Baroness, Lady Deech, and my noble friends Lord Wolfson and Lord Leigh for refocusing the House on these two amendments. I will answer as many of the broader questions as I have time for after addressing these myself.

Let me begin with Amendment 48, tabled by the noble Lord, Lord Warner. This amendment would require the Secretary of State to lay before Parliament a review of the Bill’s compliance with the Human Rights Act 1998, and in particular Article 10 of the European Convention on Human Rights, within six months of Royal Assent. As my noble friend the Minister has set out, the Bill will apply to public authorities as defined in Section 6 of the Human Rights Act. In the exercise of their public functions these bodies do not have their own rights under the Human Rights Act or the ECHR, including under Article 10. The Bill does not apply to individuals and their private functions; therefore, it will not infringe on any individual’s rights under the ECHR.

As for the questions asked by the noble Lord, Lord Warner, about compatibility, the Government remain strongly committed to the UK’s long and proud tradition of free speech and to the ECHR’s Article 10 right to freedom of expression. The Minister has signed a statement of the Bill’s compatibility with ECHR rights. On sharing legal advice, His Majesty’s Government do not share legal advice, but we do act on it.

Nothing in the Bill goes against the European Convention on Human Rights. The ban will apply only to bodies that are public authorities under the Human Rights Act 1998—

[Lord Warner (CB)]

With due respect to the Minister— I am sorry to interrupt when he is keeping to his script—the point I was making was that the certificate that the Secretary of State or Minister signs on the face of the Bill does not just cover the actions of public bodies, it covers all aspects of that particular piece of legislation. I am arguing that there are parts of that legislation that make it impossible to sign with good heart that compliance with the European Convention on Human Rights—and, indeed, the Human Rights Act 1988. It is not just the issues around public bodies, it is about the totality of that piece of legislation being compliant. I gave some examples where it was not compliant. I am very happy to meet the Minister to give him another half a dozen in which it is not compliant. I was asking which legal Minister signed off this as compliant with the Human Rights Act.

[Lord Roborough (Con)]

My noble friend the Minister has signed the statement of the Bill’s compatibility and is comfortable with that. If the noble Lord, Lord Warner, would like to share his specific concerns further to this, I would be happy to look at them.

The Government remain strongly committed to the UK’s long and proud tradition of free speech and to the ECHR. My noble friend the Minister, on bringing this legislation to the House, confirmed that the provisions of the Bill are compatible with the convention rights.

Let me now turn to Amendment 19, tabled by the noble Lord, Lord Collins of Highbury. His Majesty’s Government appreciate the offer of co-operation and a meeting. We would certainly take him up on that very generous offer to hear out his concerns further. Amendment 19 would exempt decisions from the ban that have been made in accordance with a statement of policy relating to human rights produced by a public authority. The Secretary of State would be required to produce guidance on the content of such statements to which public authorities would be required to have regard—a significant word, as pointed out by my noble friend Lord Wolfson.

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[Lord Purvis of Tweed (LD)]

I am grateful to the Minister for giving way. Why is British International Investment singled out as a body which is able to operate its own independent human rights impact assessment for where it chooses to invest, while other decision-makers cannot?

[Lord Roborough (Con)]

I am grateful to the noble Lord for his intervention. I will need to write to him on the specific case of BII, as I do not have the details to hand.

In answer to one of the questions asked by the noble Lord, Lord Hain, the Bill is fulfilling a manifesto commitment to prevent BDS influencing public authorities in undermining community cohesion, which is why Israel is named in the Bill and why there are currently, as I believe, no exemptions. As I think the noble Lord is aware, we are intending to add exemptions under statutory instrument following the passing of the Bill.

[Lord Collins of Highbury (Lab)]

We are going to address the issue in the next group, so I am reluctant to make this point, but it is not just Israel that is listed in the Bill.

[Lord Roborough (Con)]

I apologise for my error and take the noble Lord’s correction. I have tried to focus my comments on the amendments and the arguments put forward today. I am conscious that there have been a lot of very important points made and a lot of questions asked. I have tried to answer the ones that I can, and I will write to noble Lords where I have not picked them up.

[Lord Collins of Highbury (Lab)]

This has been an incredibly useful discussion and debate, but this is not a probing amendment. It is an attempt to bring two sides of the House together. I made it very clear in my opening remarks that we oppose the BDS campaigns we have seen. I do not accept them. They are very damaging. I think I made the point that they have sought to target Israel alone, hold it to different standards, question its right to exist—which is wrong—and equate the actions of the Israeli Government with Jewish people, in doing so creating the very hate that my noble friend raised.

To be honest, I feel as if I am in a Catch-22 situation. On the one hand, the noble Baroness, Lady Noakes, says that there are loopholes, but this is not a restrictive, confined piece of legislation, dealing with BDS campaigns specifically. It has much wider implications. Everyone keeps talking about public bodies making foreign policy. No one questions the right of the Government to make foreign policy. The Government’s duty is to speak for the whole country on foreign policy —no one doubts that—but the Government have placed a duty on public bodies to have ethical human rights considerations in their investment and procurement policies.

We will come on to it in other groups, and I know we keep raising these things, but the sad thing is that the Bill damages our foreign policy. It will implicate us in undermining the very resolutions that we have tabled and supported at the United Nations. That is why we are so concerned, and that is why this amendment, far from giving public bodies the responsibility to decide on foreign policy, agrees with this Government when they speak about—I will quote again, because I think it is really important—

“belief that the promotion of business, and the respect for human rights, go hand in hand”.

When it comes to the statement that a Secretary of State may produce as guidance, is it that public bodies “will have” or “must have” regard to it? I have had many debates on previous legislation about what that might mean, particularly over codes of practice, as the noble Baroness knows, so I am happy to enter into legal dialogue about what that means. It is not unusual to require public bodies to follow that sort of guidance, and we can come up with words for that.

The noble Lord, Lord Wolfson, asked questions about the Occupied Territories. We have an existing policy on the Occupied Territories, so if a public body says it will not invest in the Occupied Territories, that is in accordance with the guidance issued by this Government. If it says it is going to ban any investment in Israel, that would be in breach of the code or whatever guidance, because we are against singling out Israel.

Somebody mentioned gay rights. I have been a campaigner for global gay rights for many years, and one of the things I have resisted doing is advocating blanket boycotts because I know that, where we have investment and contacts, the leverage, guidance and engagement we can have can make a big difference. We have changed people’s attitudes through that. The problem with blanket boycotts is that they have the complete opposite effect.

Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Roborough Excerpts

Committee stage
Wednesday 17th April 2024 Lords Chamber

[Lord Deben (Con)]

If a Church of England or Catholic school says it will not buy from a country that is persecuting Christians, that is concentrating on its core responsibility. It is not avoiding it; it is what it is there for, which is to uphold the faith. Are we really going to dictate whether or not it should make that decision?

[Lord Roborough (Con)]

My Lords, the Minister has an advisory speaking time of 20 minutes. May I respectfully suggest that we leave any further interventions until the end to allow the Minister to answer as many of the existing questions as possible?

[Baroness Neville-Rolfe (Con)]

I have already said that I am trying to answer the many questions noble Lords have asked. There have been a great many interventions on me and I have been very patient. I have also made some undertakings to try to clarify some of these points, including childcare, which would cover the schools that my noble friend Lord Deben mentioned.

Perhaps I could turn to Amendment 54, which requires

“the Secretary of State to provide a comprehensive list”,

of the bodies in scope

“before the provisions in Clause 1 can be brought into force”.

The Government are not able to provide a comprehensive list of bodies captured by the Human Rights Act definition. However, I have tried to be clear on the categories of bodies that includes. To repeat, these include: central government agencies and non-departmental public bodies; UK Government Ministers and devolved Ministers; local authorities; administering authorities of local government pension schemes; universities and higher education providers with public functions; publicly funded schools; and some museums and galleries in receipt of significant public funding.

As with any definition, there will be further cases at the margins where it is impossible to generalise without the full facts of a case. That, of course, is where the courts come in. Legislation often uses general definitions—for example, the Human Rights Act from which we have taken the scope or the scope of bodies covered by obligations under public procurement legislation.

Finally, I turn to Amendment 14A. This would remove from the Bill the powers granted to the Secretary of State to amend the schedule to make exceptions to the ban for certain bodies, functions and types of considerations, and to amend or remove regulations made under these powers. I understand concerns about the use of subordinate legislation—the noble Lord knows that—and we are lucky that we have such a good committee to supervise its use. However, these powers are necessary to ensure that the ban can evolve over time and operate as intended, for example in response to emerging global events.

I assure the noble Baroness, Lady Chapman, that the FCDO is fully supportive of this legislation, and all regulations made under this Bill would follow the normal procedure of cross-governmental clearance and, of course, be approved by the Foreign Secretary. In the event that in future the ban has unintended consequences for a certain public authority, it is right for the Secretary of State to have the power to exempt that body, or a function of the body, from the ban via statutory instrument—I think today’s debate shows that that is necessary—and this would be subject to affirmative resolution by both Houses.

These powers will also allow the Secretary of State to exempt certain types of considerations from the ban. For example, Ministers may decide to exempt a narrow type of consideration to ensure the ban can evolve in line with government policy. The powers future-proof the legislation to ensure the ban can continue to operate effectively and mitigate against any unforeseen circumstances.

Before I close, I should perhaps address the point made by the noble Lord, Lord Deben, on the environment. The ban applies only to decisions that target a particular country or territory. For example, environmental campaigns, including ones against fossil fuels that are not country specific, are outside the scope of this Bill. I also reassure my noble friend that the power in Clause 3 cannot be used to remove any exception to the ban in the Bill as passed by Parliament. There is a schedule the noble Lord can look at, which includes environmental misconduct, which we are coming on to discuss.

I hope, finally, to address the point raised by the noble Lord, Lord Davies of Brixton, with regard to why there is a separate clause in the Bill for local government pension schemes. The administering authorities for local government pension schemes are public authorities under Section 6 of the Human Rights Act. Capturing administering authorities of LGPS in a bespoke provision means that the Pensions Regulator can use its existing powers and procedures to enforce the BDS ban for the administering authorities of LGPS. That avoids the Pensions Regulator setting up a separate enforcement system for the Bill. I am happy to have a discussion with him; we often discuss pensions issues which are of limited interest sometimes to the whole House.

I hope that my response to this group of amendments —importantly, alongside the undertakings I gave in response to my previous group which we expanded a little to bring in telling examples—will help the Committee to understand why we have chosen the Human Rights Act definition and I ask the noble Lord to withdraw his amendment. I look forward to further discussion.

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”.

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[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.