Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Wallace of Saltaire Excerpts

Committee stage
Tuesday 14th May 2024 Lords Chamber

I sympathise with what the noble Lord, Lord Hendy, is trying to do and I hope there may be other ways of achieving the objective of really beefing up the labour-related misconduct provision in the Bill, which I too think is inadequate—but I am not sure that Amendment 32, as it currently stands, would work.

[Lord Wallace of Saltaire (LD)]

My Lords, there is no one on the Liberal Democrat Benches tonight who is sufficiently expert in international law to intervene at length in this debate, so I will be very brief.

I read the discussions from the last evening we met—I apologise that I was unavoidably away—and I note the argument made that international law is not simply the law but a broad network of treaties, conventions and agreements to which the UK has become a party. Much of it was drafted in the formative years after the Second World War by British lawyers—Conservative British lawyers, under Conservative Governments—in which we played, as Ministers still like to say, a leading role. Some of us are now quite nervous that there are some elements within the current Conservative Party, some of whom are in government, who are not particularly committed to maintaining our established reputation as a staunch upholder of international law.

We on these Benches would suggest that the Government take back paragraphs 6 and 8 of the Schedule, take into account the criticisms that the noble Lord, Lord Verdirame, and others have made, and consider how we can ensure that these are strengthened and clearer, so that we can all agree that there is nothing in the Bill that encourages denigration of international law. All those involved in taking investment decisions should be quite clear that, in dealing with overseas investments, the framework of international law is one that should always be considered and accepted.

[Lord Warner (CB)]

My Lords, I intervene briefly, not because I am an expert on international law but because I have a great sense of déjà vu about the way this debate is opening up by comparison with the previous debate. The issue seems to be the creation of uncertainty about what the law means. That was the issue dominating the previous debate: that the trustees of pension schemes would be left in a state of uncertainty if we did not put clearer language in the Bill. This debate is starting to go through the same process but in another area, where there could be uncertainty about what people do in interpreting this legislation before they make their decisions. We are opening up issues that the Government need to attend to, to make sure that the Bill is clear to the people who will be required to implement it.

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[The Lord Bishop of Manchester]

My Lords, I support this amendment and the stand part notice, to which I have added my name. I declare again my interest that as a bishop I can, in certain circumstances, be deemed to be a public body in my own right. I can also assure your Lordships that I have no acquisitive designs on any noble Baroness’s handbag this evening.

Clause 4 represents an attack on free speech. It prohibits even statements that suggest a person would have acted differently had it been legal to do so, even if they make it clear that they are going to act within the confines of the law. It is hard—as the noble Baroness just said—to see this as anything other than a sizeable infringement on that basic right to free speech, which is a cornerstone of our democracy.

Your Lordships will not be surprised that I oppose that restriction as a matter of principle. Free speech should be limited only when it is absolutely essential in order to prevent some very grave harm. I have heard nothing to date to suggest that such grave harm is likely to arise. If the Minister or her colleague has an example—perhaps in the aforementioned handbag— I plead with her to share it with us tonight.

Having taken a matter of principle, let me now set out why I believe the clause also contains important practical challenges. The Local Government Association has labelled this clause as particularly problematic. The Government say in the Explanatory Notes that councillors are not prohibited from expressing support—including in minutes—but if that is so, why is it not clearly in the Bill? Why not just remove this problematic clause?

Aside from the moral qualms that we might have about limits on freedom of speech, it is difficult to see how this clause could be enforced. It makes councillors particularly vulnerable to challenge when we elect them to give their opinions; they have to be free to do so. I also know, from having served for a good number of years as the independent chair of a local authority standards committee, that it is not always clear when the elected member is acting on behalf of a council or on their own behalf. Noble Lords may well remember one famous case where this distinction lay at the heart of it, involving the person who was at that time the Mayor of London. Mayors are of course public bodies in their own right, and that entire case, at the various levels it went through, hung on whether at that time he was acting as the Mayor of London or simply as a private individual going about his own business.

We heard at Second Reading the concerns that this will create a culture in which difficult ethical discussions do not take place, because of fears that this clause might be brought into action. Later this year, we are going to have a general election, I believe. Many candidates in that election may also serve on local government bodies. It would be invidious to our democracy for a candidate not to be able to answer honestly a question raised at a hustings, or by a journalist, out of fear that action might somehow then follow under this clause.

I have focused on local authority members, but we have spent many hours already in Committee discussing the uncertainty as to who exactly constitutes a public authority or a public body, or even whether those two terms mean the same thing. If we end up with university authorities being so classified, do we really wish to fetter the free speech that lies at the heart of healthy academic institutions—in fact, the free speech of which, on just about every other occasion we have discussed it in this House, I have always felt this Government to be a strong supporter? The only way to avoid such a culture of intimidation, which I am sure we all agree would be detrimental to local democracy, and potentially to wider civic and public life, is to remove this clause altogether.

[Lord Wallace of Saltaire (LD)]

My Lords, I have been trying to think of the right reverend Prelate as a public body. He is certainly a public authority, but he is at most a hybrid public body. I am not quite sure what sort of hybrid he is in this respect.

My name is on Amendment 33 and the clause stand part notice. I make it clear that this entire clause should go. The exact phrase in the Conservative Party manifesto in 2019 was:

“We will ban public bodies from imposing their own direct or indirect boycotts, disinvestment or sanctions campaigns against foreign countries”.


There was nothing about what they say there, although I note that the department’s memorandum for us says:

“It is intended that the measures will be widely construed”.


This is widely construed to the degree of being ambiguous and imprecise, as so much of this badly drafted Bill clearly is.

Yesterday I ran into the noble Lord, Lord Frost, in the corridor and commented on his rather good article, which was in the Telegraph on Friday, on freedom of speech as fundamental to the Conservative Party. I then asked him what he thought about Clause 4 of this Bill. He looked at me in some confusion and said, “I thought that had been withdrawn already”. I wish that that thought was a precursor of the change.

I have found it difficult to find arguments in support of the clause. I looked through the Commons Public Bill Committee stage, where evidence was taken from the legal adviser to the Free Speech Union, who said:

“My position is that clause 4 really needs to go in its entirety … there is no need—I think it is not necessary either politically or perhaps even legally—to prohibit statements. The mischief that is to be prohibited is the threatened act … This Bill very clearly targets expressions of political and moral conscience, which is to say the form of expression that is most highly protected by article 10””.—[Official Report, Commons, Economic Activity of Public Bodies (Overseas Matters) Bill Committee, 5/9/23; cols. 38-39.]


of the European Convention on Human Rights. It is not just the European Convention; we go back to the Atlantic charter, the fundamental basis on which the post-war international order rested, drafted by British diplomats, and in which the four freedoms include freedom of speech and freedom of belief.

I note that, in the Commons stages, one Conservative MP, David Jones, said:

“This is a Conservative Government. Conservatives believe in and value free speech … This is a deeply un-Conservative measure and I believe that the amendment”—


to Clause 4—

“is right and that the provision should go”.—[Official Report, Commons, 25/10/23; col. 915.]

The Committee should take that seriously. In the Commons debates, another Conservative MP referred to this clause and the ones that follow as introducing the concept of “thought crime”.

The Constitution Committee of this House’s very critical report says:

“The protection of free speech is a fundamental right. In our view, clauses 4(1)(a) and 4(1)(b) unduly limit freedom of speech … The House may wish to consider whether clause 4 should be removed from the Bill”.


I dare to suggest to the Minister that this House will reject this clause and that, when the Bill returns to the Commons, it is quite possible that a number of Conservative MPs who do believe in conservative values of free speech will find it convenient not to be there when the Commons vote again. Therefore, it would be wise for the Government to consider their position and, I suggest, withdraw this clause.

[Lord Warner (CB)]

My Lords, the noble Baroness, Lady Chapman, was kind about my previous speech and almost enticed me to get up and go over some of this ground again. When I spoke on Amendment 19, I was concerned about the statement of compliance with the Human Rights Act that the Minister had signed in the Bill. I probably took my eye off the ball a little by going for that rather than Clause 4 directly. But I said that the reason for the non-compliance was the presence of Clause 4 in the Bill, which was clearly in breach of Article 10 of the ECHR. I asked the Minister to cite the Government’s legal advice that justified that statement of compliance. I was given the usual answer from Government Front Benches, that the Government do not reveal their legal advice.

After that event, I turned my attention, as the noble Lord, Lord Wallace, did, to the Constitution Committee’s report, which is an interesting document. Paragraph 5 says, in bold type, that this clause is in contravention of the ECHR. It does not mince its words; it says it clearly and unequivocally. It is worth looking at the make-up of the Constitution Committee. It has 12 members, five of whom are distinguished lawyers. It has a former Lord Chief Justice, a former Lord Chancellor and three eminent King’s Counsels. It also has a former Conservative Leader of this House: the noble Lord, Lord Strathclyde. The Minister was reticent about quoting the Government’s legal advice, but I am not at all reticent about citing the source of my legal advice: the Constitution Committee.

I can see no grounds why this Government should continue with this gagging clause when a very eminent set of lawyers on the Constitution Committee has said, in words of one syllable, that this is a breach of Article 10 of the ECHR. I will not go back over the ground about the statement of compliance—the issue is clear cut. It is that we remove this gagging clause, which is an impediment to free speech.

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[Baroness Noakes (Con)]

My Lords, as a Conservative, I believe absolutely in the right to freedom of speech, but I do not think that the limits on freedom of speech in Clause 4 are as great as some noble Lords have tried to make out. I do not think that Article 10 of the European Convention on Human Rights is something that affects the rights of individuals, and Clause 4 is fundamentally aimed at public authorities. I completely understand that there is a very small number of public authorities who can be individuals as well, but, as my noble friend the Minister explained at Second Reading and as the Explanatory Notes make very clear, the prohibition on statements is against public authorities and attaches to individuals only to the extent that they are speaking for the public authority. Even if it applies to the statements made by individuals on behalf of the public authority, the ban applies to the public authority and the enforcement action is taken against the public authority. So individuals are not targeted by Clause 4.

We have to remember that this is not an academic issue. We already know that councils are starting to pass BDS motions and they are against this Bill. We know that the student encampments are including demands or public statements on the conflict in the Middle East and on divestment. They may not get all their demands, but that is certainly where they are pushing towards. Without the Bill, I think we can be fairly sure that BDS activities and statements will continue to increase and that will have an impact on social cohesion, and a particular impact on the Jewish communities that are affected by the sorts of statements that are made.

[Lord Wallace of Saltaire (LD)]

The noble Baroness said that she is afraid that BDS statements will increase. Is she in favour of preventing such statements in unavoidably lively public debate?

[Baroness Noakes (Con)]

Yes, I am against statements being made by public authorities. I am trying to make the distinction at the moment between public authorities and the individuals who are involved in those public authorities, who I think are hardly affected by this, except to the extent that they speak for the public authority. I think there is a case for taking a position against statements by public authorities, because of the impact on social cohesion.

We have to remember that this provision does not come from nowhere: it is rooted in the real, live example of what happened in Leicester Council back in 2014. It passed a BDS motion and then said, “only as far as legal considerations allow”. At that time, that was hugely divisive in the local community. It does cause very real harm and that is why this is so different from the kind of example that the noble Baroness, Lady Chapman, gave at the beginning, about wanting to make a statement about stealing my noble friend’s excellent handbag. This is about social cohesion, at the end of the day; that is why this provision is in here.

--- Later in debate ---

[Baroness Neville-Rolfe (Con)]

I note the point that the noble Baroness has made. We did reply to the Constitution Committee, but I will reflect further on this point.

My noble friend Lady Noakes said that there had been some confusion due to the use of the term “person”, which I have already referred to. To respond to the point raised by the noble Lord, Lord Hendy, in the context of this clause, the legal term “person” refers only to a person subject to this Bill’s ban. In other words, it refers only to a public authority as defined in Section 6 of the Human Rights Act 1998. The legal term “person” does not have the same meaning as in normal English. This is standard legal drafting.

Additionally, for the purposes of this Bill, decision-makers are public authorities—as explained by my noble friend Lady Noakes and confirmed in Clause 2(1) of the Bill, which I have just referred to. Public authorities will delegate decision-making to individuals, but individuals’ decisions or statements are captured only when they are made on behalf of the public authority. This issue was also discussed in Committee in the other place. It was because we listened to the concerns raised on this point that we revised paragraphs 32 and 33 of the Explanatory Notes. Paragraph 32 states:

“As only public authorities are subject to clause 1, this clause is strictly limited to the actions of public authorities”


and therefore not individuals associated with public authorities. I think that goes three-quarters of the way to answering the question asked by the noble Baroness, Lady Chapman, but I will follow up.

I hope that makes it clear that this Bill is not an assault or restriction on the principle of free speech. Rather, it aims to ensure that the UK speaks with one voice internationally. Public authorities should not be pursuing their own foreign policy agenda or publishing statements on foreign policy. It distracts from their core duties. Clause 4 will support those bodies to remain focused on that purpose. It is a core part of the Bill and meets the manifesto commitment to ban public bodies from imposing their own direct or indirect boycott, divestment or sanctions campaigns against countries and territories.

Briefly to address Amendment 33, and the point raised by the noble Baroness, Lady Chapman, I remind the Committee of just how divisive of community cohesion within the United Kingdom declarations of intent to boycott can be. That includes statements made by public authorities that indicate that they would intend to participate in boycotts and divestments if it were legal to do so. The right reverend Prelate the Bishop of Manchester, who I am very glad has joined our discussions, will have noted what I said about elected officials, including councillors, expressing a view which is not related to the narrow purpose of this Bill. He asked for an example of our concern. We saw a good example in Leicester, which my noble friend Lady Noakes referred to. In its resolution in 2014, Leicester City Council passed a motion targeting the activity of the Israeli state with a boycott

“insofar as legal considerations allow”.

The motion was widely condemned by Jewish groups and was extremely divisive. This demonstrates the need to ban statements of intent to boycott or divest which express—

[Lord Wallace of Saltaire (LD)]

My Lords, we need to be very careful about how we talk about social cohesion at present. As it happens, I spent some time last weekend in Saltaire, which is part of the Bradford local authority, talking with one of Yorkshire’s Christian leaders and one of Yorkshire’s Muslim leaders about how we maintain social cohesion and interfaith co-operation under the current circumstances. It is not easy. These are two people whom I like and trust, and they are very good friends. We have to recognise the impact of the ongoing war, and in particular the response of our younger generation—white and Christian, and south Asian and Muslim—in all their diversity. It is very delicate at present, and simply asserting that stopping debate is a way to maintain social cohesion is not the answer.

[Baroness Neville-Rolfe (Con)]

As the noble Lord knows, the Bill aims to improve the situation with social cohesion. I note what he said, but we have seen examples of councils, such as Islington, passing motions in opposition to the Bill alongside foreign policy statements about Israel and other countries. While this might not be a breach of the ban, it demonstrates a strong interest in public authorities engaging in BDS campaigns. It could demonstrate that the Bill is already be having its intended effect of preventing public authorities making divisive statements.

The point is that, overall, Clause 4 supports the main aims of the Bill in ensuring that the UK speaks with one voice internationally and has one foreign policy agenda, and that public bodies do not introduce policies in that area that risk dividing communities at this difficult time. Accordingly, for this evening, I kindly ask the noble Baroness to withdraw her amendment.

Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Wallace of Saltaire Excerpts

Committee stage
Tuesday 14th May 2024 Lords Chamber

[Lord Warner (CB)]

My Lords, I intervene very briefly as a person who benefits very considerably from a local government pension scheme; indeed, pretty much my whole income comes from one. One thing that always concerned me and colleagues who were in these schemes was that they were well run, that their management was good, that they were reliable and that our deferred income—which is what a pension scheme is using—was being looked after well. What I hear from these amendments that are being spoken to in this group is that we need to strengthen the Bill if we are to continue with well-run pension schemes.

I also rather agree with the point made by the noble Lord, Lord Davies of Brixton, that it is very difficult to see what the case is for treating public authority schemes separately from private schemes—but that is a debate for another part of the Bill.

Here we should really be accepting technical amendments endorsed by the noble and learned Lord, Lord Thomas, the noble Lord, Lord Willetts, and in particular the noble Baroness, Lady Drake, which it seems to me would improve the confidence of beneficiaries of these schemes that the reliable management of the schemes would not be damaged.

[Lord Wallace of Saltaire (LD)]

My Lords, I should declare an interest as a beneficiary of the university superannuation scheme. Can the Minister remind us how many times any local government pension fund has taken decisions on political and ethical grounds towards investment in particular foreign countries? The Explanatory Notes to the Bill give us a very small number of examples of where local government pension funds have discussed whether they should. We will come later to the question of whether we should ban discussions of these sorts in a free country, but that is different. I worry about whether we are having an enormous debate about something which has not happened in this country and is unlikely to happen in this country. It happens in the United States, and the American debate filters into this country. Particularly on the right in British politics we have an awful tendency to pick up American partisan politics and try to apply them over here, which I am deeply unhappy about. Is this a real problem or a manufactured, confected problem? If so, could we possibly leave it aside until some future date when it perhaps becomes a problem?

[Baroness Janke (LD)]

My Lords, I also belatedly declare my interest as a beneficiary of the Local Government Pension Scheme.

Permanent Secretaries: Appointment and Removal (Constitution Committee Report)

Lord Wallace of Saltaire Excerpts

Thursday 9th May 2024 Grand Committee

[Lord Wallace of Saltaire (LD)]

My Lords, this small gathering of experts interested in this subject brings back for me happy memories of standing in the office of Mr Maude, as he then was, with his special adviser, as she then was, arguing about the future of the Civil Service and waiting for Permanent Secretaries to come in and argue with us, in what, the current Prime Minister tells us, was the chaotic situation of the coalition Government—which has been succeeded since then by the sound, single-party Government that we now have.

Of course, we are talking about the exceptional circumstances of the past five to seven years, with the astonishing turnover of Prime Ministers—two of whom, Boris Johnson and Liz Truss, behaved in an extraordinary way—and part of our question is how far we can regard that, in retrospect, as an exceptional circumstance that will not recur or as something which we have to respond to and build future defences against. The noble Lord, Lord Young, reminded us that sofa government under the Blair Administration had some characteristics that were not dissimilar; some of us go back as far as Margaret Thatcher’s constant questioning—“Is he one of us?”—in relation to civil servants as well as others. So this is not entirely new and I am not sure that we want to go all the way back to the period when Crossman, as some will remember, had a Permanent Secretary with whom he absolutely could not get on but with whom he was stuck and who was a powerful personality herself. We have to adapt to change to some circumstances.

Clearly, the situation under Liz Truss and Boris Johnson was exceptional. The war on experts, or “the blob”—Michael Gove clearly regarded most of the Civil Service, as well as the BBC, universities, journalism and various other things as part of the dreadful blob to be killed—biased the debate about the role of the Civil Service.

I note that, in paragraph 124 of the report, the noble Lord, Lord Macpherson, is quoted as saying that, under the Truss Government,

“you had to tell them what they wanted to hear”.

I recall a civil servant telling me that, when Liz Truss was the head of his department, you were told that you were supposed to give her only the good news when you went into a ministerial meeting. They said that senior civil servants who might be responsible for what was being discussed were excluded if they provided opinions on what was being said that were too critical. Clearly, that is also exceptional.

We know that Dominic Cummings behaved as no special adviser should ever behave. I have been told that, on occasion, he would summon senior civil servants from other departments to see him, without informing their Secretary of State or their private office.

We have to hope that all of that exceptional behaviour is now in the past, but we must recognise that we face longer-term problems of constant short-term policy-making, failure to sustain major projects over a long period, and failures of strategic planning or foresight. We also have to recognise that those come, perhaps, from deeper and shared weaknesses among the Civil Service, Ministers and Parliament. In that case, we would have a much broader agenda for constitutional reform, which we cannot debate now.

We have to recognise that the rate of ministerial churn has been as much of a problem as that of Civil Service churn. I recall another civil servant telling me that, in three years in one post, she had four Secretaries of State and three Ministers of State. That makes constant changes of policy rather difficult to cope with. The relationship between Ministers and the Civil Service has to be based on respect for evidence and on the constructive tension that follows from those who talk about the evidence and the problems of implementation and those who talk about their preferences and their desirability to change the way in which things are done.

This raises questions about the role of Ministers—again, they are perhaps questions for another Constitution Committee inquiry—and whether Ministers also need rather more training than they receive, and whether changes of government ought to take place not over three days but over at least two weeks, to give some chance for parliamentarians, who in many cases have no previous ministerial experience, to learn a bit about what they are taking on, how to treat the Civil Service, how to run Whitehall and so on.

I should say this about ministerial roles. I used to work at Chatham House, in the 1980s, and therefore worked closely with the Foreign Office. I recall the devotion with which senior and junior officials in the Foreign Office talked about their Secretary of State, Geoffrey Howe, and the sheer sadness that so many of them expressed when he left. Relations between Ministers and officials can be close and can be very much a matter of mutual respect. We have lost that in too many cases recently; that is as much a matter of the deterioration of our politics as of our Administration, I am afraid.

If we want to get really good Permanent Secretaries and maintain them, we have to recognise that, as the report suggests, the complexities of Permanent Secretaries’ roles make previous experience of the Civil Service highly desirable. That also suggests that, if you want a broader range of experience, career paths that go in and out of the Civil Service are highly desirable. I like the suggestion that there should be a stronger alumni network for those who have Civil Service experience and have gone out; I think that that is mentioned in the Institute for Government’s report, which a number of us have clearly already read.

We certainly need to do more training for senior officials. I used to teach the top management course—which I suspect the noble Lord, Lord Maude, abolished, although I am not sure about that. I recall meeting civil servants who had been sent to INSEAD, and I think the idea of sending civil servants off to courses such as that is highly desirable. Those are all things which we hope a new Government will wish to take on board.

We have to take salaries on board as well, and we also need to recognise the sheer complexities of being a civil servant. Sir John Kingman is quoted in the Institute for Government’s report as saying that what you need is

“sufficiently dispassionate—and resigned”

attitudes

“to accept and adapt to the changing whims of successive ministers”.

That is a bit hard, but I understand what he means.

I recall a good friend in the Foreign Office who resigned and became headmaster of a public school. I asked him why on earth he had done so, and he said, “Well, I found when I was going to the cinema, William, I was crying too often. I was just having to suppress too many of my own preferences and emotions in order to sustain the neutrality of a civil servant”.

The final thing I want to refer to is the Institute for Government’s suggestion that fostering

“a national culture of contributing to government”

is a way to rebuild respect for the Civil Service and the morale of the Civil Service. If we want to maintain a competent Civil Service, with people coming through to the top who are of the top quality, we have got to shift away from the position in which the mainstream media, and too often politicians on all sides, blame the Civil Service. We should ask for that to stop and for the Civil Service to be valued properly. That is perhaps as hopeless as asking for the second Chamber, the House of Lords in its current composition, to be valued properly as well.

Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Wallace of Saltaire Excerpts

Committee stage
Wednesday 17th April 2024 Lords Chamber

Moved by

[Lord Wallace of Saltaire]

10: Clause 2, page 2, line 3, leave out from “decision-maker” to end of line 4 and insert “is acting on behalf of a public body.”
Member’s explanatory statement
This, alongside another to Clause 2 in the name of Lord Wallace of Saltaire, is a probing amendment to clarify the distinction between a public body and a public authority.

[Lord Wallace of Saltaire (LD)]

My Lords, in moving Amendment 10 I will also speak to Amendment 13 and the others in the group. I would particularly like to say how helpful I thought the amendments from the noble Baroness, Lady Noakes, were in helping us to clarify these very broad terms: public bodies and public authorities. I have just been looking back at some of the debates on the Human Rights Act 1998, during which then Home Secretary Jack Straw said that this was an extremely difficult area on which to find an exact definition; he decided to leave it to the courts for further definition.

One of the things we have to consider while discussing this is how much we do want to leave it to the courts, or to ensure that what it says in the legislation is a little tighter than what we have so far. The drafting of the Bill in so many areas is extraordinarily and dangerously loose. I thank the Minister for the letter she has sent me and no doubt others on the question of individual responsibility and personal liability. I am not sure that I entirely understood it; I showed it to one or two legal acquaintances, and they are not sure that they are much clearer than they were before. That perhaps shows some of the difficulties in which we are engaged.

When I first read this Bill, I noticed that it declared in its title that it was about public bodies, and that in Clause 2 it says it is about public authorities. As it happens, I got into the lift with another Member of this House, with whom I worked when he was a Conservative Cabinet Minister during the coalition Government. I asked him casually: “Tell me, do you think that a public body and a public authority are the same thing?”. He said: “Oh no, of course not. The definition of a public body is far narrower than that of a public authority”.

A Bill that starts by having one of these terms in its title, and then goes on to use the other term in the text, raises a number of questions. This morning I reread the impact assessment, which uses the terms interchangeably, by and large preferring “public body” to “public authority”. I worry about how clear those who drafted the Bill are about what they are doing. We then go into “hybrid public bodies”, which the impact assessment talks about, or hybrid public authorities. When I began to read through Lexis and try to understand some of the case law—in which a number of noble and learned Members of this House emerge as those who have made judgments on this—I discovered that functional public authorities and hybrid public authorities raise many of the questions with which we would have to deal, if and when this became an Act. The line between public and private functions for public authorities that are partly public and partly private is a very delicate one, and one on which litigation leaves much room.

We all know what core public authorities are, but hybrid public authorities are a very loose and broad entity. The Minister said on a previous occasion, in another context, that there were well over 100,000 public authorities. No doubt the definition, after a while, becomes extremely unclear. After all, Section 6(3) of the Human Rights Act 1998 talks about

“any person certain of whose functions are functions of a public nature”.

The question of how many functions need to be of a public nature, and how much that affects how they behave in other areas, has been contested in the courts on many occasions. Court cases have ruled that a privatised railway company, for example, is not a public authority, but that a privatised water company and, in a different case, a private provider of social housing are, for certain purposes, public authorities. Rulings have differed on whether private care providers to local authorities are public authorities.

The impact assessment and the ministerial letter refer to “cultural institutions” as coming within this. In the letter that came to us before Second Reading, the Minister talks about museums and galleries that receive significant amounts of public money. Amendment 13 is intended to probe what is meant by significant amounts of public money. I have suggested in that amendment that the bar should be put at 50%, as opposed to whether this was largely public or largely private with public aspects. A court case in 1999 found that the University of Cambridge—

[Lord Grocott (Lab)]

The noble Lord mentioned at one stage whether railway companies are public bodies. A train operating company, for example, is clearly not a public body when it is a private company, but if it goes bankrupt or has difficulties it gets taken over by the Government. If the Government then get it right in due course, it goes back to the private sector. Can bodies oscillate between the two categories? Is that a further complication?

[Lord Wallace of Saltaire (LD)]

I defer to my noble friends on that. Part of my concern about this law is that there will be a great deal of employment for my learned friends to be found in it, if it were to go through.

Indeed, that is one of the things which appears in the delegated powers memorandum, which says at paragraph 4:

“It is intended that the measures will be widely construed”.


Paragraph 12 says:

“The prohibition will apply to ‘public authorities’ in accordance with section 6 HRA 1998; however, interpretations of section 6 HRA 1998 can create uncertainty which means that the Bill may, including as case law evolves, capture a range of bodies that it was not necessarily intended to apply to. It may be necessary to put beyond doubt that certain bodies (that are outside the scope of the intention to ban public bodies from boycotts and divestments) fall outside the definition of ‘public authority’ for the purpose of the Bill”.


I hope that the lack of clarity of that is clear.

The impact assessment does refer to hybrid public bodies and suggests that it is concerned to prevent them pursuing political and foreign policy agendas, “including with public money”. I interpret that as meaning that such hybrid public authorities may perhaps not be allowed to pursue such agendas, including when they are using private money. That is a question that will concern a great many people, in particular the university sector, from which we have received further correspondence on this precise area.

The Minister has not told us enough about the broad last category, cultural institutions, and whether this includes theatres and orchestras on foreign tours, as well as museums and galleries—and why on earth museums and galleries are in there. That is another area where I suspect that sector would prefer a little more certainty.

Universities have been particularly concerned about the impact on their international partnerships, which are, I am assured by my university friends, part of their private functions. Some of these are education partnerships, some are transnational research partnerships —I declare an interest, in that my son is actively engaged in this—and some are with foreign companies and donors. They can be very sensitive and can raise reputational problems, as some universities, including the one I used to work for, have learned to their cost. Again, it would be helpful if we had more detailed guidance on that.

At several points in the impact assessment, and in the memoranda to the Delegated Powers Committee and others, the Government emphasise the importance of ensuring the coherence of British foreign policy, and that it should not allow others to conduct their own foreign policy agendas. I notice the Express reported the other week that the Government have signed immensely valuable trade deals with Washington state and Texas. It seems an interesting contradiction for the British Government to insist that subordinate entities within the UK state should not be allowed to engage in any sort of deal with other countries while they actively attempt to get past Washington to deal with American states. I am not sure whether these are significant trade deals or not; I have the memorandum of understanding with the state of Washington and it seems rather less substantial than the Daily Express suggests.

The Minister may be thinking that precision does not matter so much in the Bill because it is intended to be largely performative and not to lead, in practice, to any serious enforcement. After all, the impact assessment notes how little boycott activity there has so far been beyond discussion, and the Bill is unlikely to be implemented before the coming election. However, we should not be in the business of permitting the Government to put badly drafted law on to the statute book for show. We need much greater clarity, and I look forward to what the noble Baroness, Lady Noakes, will say about the need for clarity in this area. The Minister shares with the House the responsibility to ensure that the Bill does not become an Act without much greater clarity about its terminology and the extent of its reach over the UK’s public and private bodies. I beg to move.

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[The Minister of State, Cabinet Office (Baroness Neville- Rolfe) (Con)]

My Lords, I am grateful for the thoughtful contributions from across the Committee. On the first day of Committee, which also touched on the scope of this Bill, we heard from the noble Lords, Lord Collins and Lord Wallace, the noble Baroness, Lady Fox, and my noble friends Lady Noakes and Lord Johnson. We discussed the Bill’s application to hybrid public authorities. Today, we have heard in slightly different terms from the noble Lord, Lord Wallace, my noble friend Lady Noakes and, of course, from the noble Baroness, Lady Chapman. I will try and come back on her essay question if I can.

Obviously, we have carefully considered the points raised in these debates. I would like to expand on our view of the scope in relation to Amendments 10, 11, 12, 13 and 14. As noble Lords have said, the Bill will apply to public authorities, as defined in Section 6 of the Human Rights Act 1998. I would like to explain, in response to the concerns of the noble Lord, Lord Wallace of Saltaire, that “public body” is a general term with no single legal definition. The Bill’s Short Title provides a general indication of the subject matter of the Bill, and it is not unusual for the Short Title to use different terminology from the Bill’s substantive provisions.

[Lord Wallace of Saltaire (LD)]

My Lords, I apologise for interrupting. The Minister will be well aware that there is a particular use of the term “public body” by the Office for National Statistics, which means that debt incurred by a public body is counted as part of the national debt. That means that whether or not some of these hybrid public authorities are defined as public bodies matters a great deal to their financial planning. Again, the university sector is particularly concerned about this.

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[Baroness Neville-Rolfe (Con)]

It depends, and it also depends on case law under the Human Rights Act, which I have undertaken to look at and come back to noble Lords.

[Lord Wallace of Saltaire (LD)]

My Lords, I cannot resist suggesting that one definition of a “public function” is somewhere you are served warm white wine and canapés. That is a suggestion of how loose some of these terms can be.

The concern that a lot of us have about the Bill is that we are not entirely confident that the Government have thought through its full implications. The manifesto commitment was specific to boycotts against Israel and was concerned particularly with local authorities and universities. But we have a Bill here with a much wider set of definitions and a universal set of foreign states to which it applies, which raises a much larger number of questions. We also have a whole succession of loose definitions, which the DLUHC memorandum to the Delegated Powers Committee says, in effect, that we should not worry too much about, as we will do this all with regulations. I hope that the noble Lord, Lord Hodgson, would think that it is not necessarily always a good idea to leave everything to regulations. We are asking for greater clarity, certainty and, above all, precision, and a more limited potential scope for the Bill.

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[Baroness Randerson (LD)]

My Lords, I will briefly go back to the Government’s own list of public bodies on GOV.UK. Of that list of public bodies, there are 18 listed for the Department for Education, none of which is a university. The Minister referred to overlapping definitions in the Bill. I have been sitting here and thinking about that, and wondering where the University of Buckingham sits in the Government’s concept of where universities lie, because that is a private university but one which is fulfilling exactly the same functions as all the other universities in the UK. Those other universities are, of course, exempt charities and so we are on a whole series of conflicting paths here, with just one aspect of the definition of public bodies that this Bill seems to wish to encompass. I raise these issues so that the Minister can perhaps give us some of her thoughts on these overlapping definitions and where they actually sit within the Bill.

[Lord Wallace of Saltaire (LD)]

My Lords, first, we are in the territory of the chilling effect, are we not? If there is a very large number of bodies which are not going to be sure how far they come within the scope of this Bill, they will be very nervous about doing things that they would otherwise do. That is why leaving it so unclear as to how far the definitions of this Bill stretch over the sector, in which public and private institutions, and public and private functions, overlap so closely, is highly undesirable.

Secondly, this clearly will require very substantial subordinate legislation. I think it is the sense of this House that it is a bad thing to pass Bills that need too much subordinate legislation. Yesterday, the noble Lord, Lord Hayward, whom I regard as an extremely good friend, said to me that the subordinate legislation under the Elections Act, which we passed in 2022, is now approaching 1,000 pages, and that the Electoral Commission is spending a considerable amount of its time providing guidance for local authority electoral registration officers on what this means for them. That is bad legislation; we want to avoid that again here.

Thirdly, there have been occasions, as others are aware, where lists of public bodies have been provided. The Minister will remember the SI on trade union levies being taken, or no longer being taken, automatically from pay scales for particular public bodies. That had a list, at the end, in the schedule, of over 200 bodies, which included some quite interesting ones such as the Scottish salmon council, and various semi-charitable local institutions to do with, as I remember, care homes and nurseries.

Fourthly, to add to the question of universities, what universities are most concerned about is whether or not the student loan book, which is a very large sum, is included in the Treasury’s calculation of national debt. That is not a marginal issue; it is quite important. That is why definitions such as this and how they are used by different parts of government and recognised be the courts are extremely important.

Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Wallace of Saltaire Excerpts

Wednesday 17th April 2024 Lords Chamber

[Baroness Lister of Burtersett (Lab)]

My Lords, I support all the amendments in this grouping. I think we still have to hear one of them being set out.

The climate emergency is surely the most important issue facing our planet. We should not be responsible for tying the hands of any body, such as a local authority, that might be able to use its position to oppose actions that contribute to environmental degradation. At Second Reading, the Minister, moving onto climate change, said:

“I would like to clarify that the Bill will ban only considerations that are country-specific. It will therefore not prevent public local authorities divesting from fossil fuels or other campaigns that are not country-specific”.—[Official Report, 20/2/24; col. 593.]


But she did not mention the question of legality, because paragraph 10(3) of the schedule makes clear that environmental misconduct means conduct that

“amounts to an offence, whether under the law of a part of the United Kingdom or any other country or territory”.

Yet many of the actions driving the climate emergency are perfectly lawful. Indeed, as Friends of the Earth points out in its briefing, the fact that destructive environmental activity is allowed to continue legally could even be the rationale for a boycott or disinvestment campaign.

So I invite the Minister to reconsider what she said at Second Reading, or, better still, amend the Bill’s schedule so as to remove the reference to an offence under the law and work with other noble Lords whose amendments are in this group to see how we can take on board the concerns that they have raised in those amendments.

[Lord Wallace of Saltaire (LD)]

My Lords, I rise to support these amendments and simply emphasise that the whole issue of climate change and environmental degradation is now a very major one, which divides generations. My children care about it much more passionately than my generation does. In the United States on the hard right, there is still a very powerful climate change denial lobby pushing against the inclusion of environmental sustainability and development goals in company statements and so on. So I think it would be wise to widen this part of the schedule, not just to deal with environmental misconduct but to accept some of the language in the various amendments that we have seen. Again, this goes back to the Government. They are thinking of the long term and about long-term planning and public opinion. It would be wise to see what can be done to adjust the language to accommodate the very real concerns which have been expressed.

[Baroness Deech (CB)]

My Lords, environmental matters are of course very serious, but the question is whether boycotts work. The speech by the noble Lord, Lord Hain, shows the determination on the part of some in this House to boycott Israel come what may. However, if you look at the list of the most polluting and environmentally damaged countries in the world, Israel does not feature, and the degradation in Gaza, which is true, started long before the current invasion—it goes back to when Israel quit Gaza in 2005. Now, the issue is boycotts. People are looking for ways to boycott Israel. I have not noticed any suggestion of boycotting, say, China, for its polluting activities.

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[Lord Warner (CB)]

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

[Lord Wallace of Saltaire (LD)]

My Lords, I will try to be brief at this late hour. I spent my entire career studying and writing about foreign policy. The noble Lord, Lord Moylan, was kind enough when he made his speech some months ago to say that, when he joined the Foreign Office, he was told, “You’ve got to read William Wallace’s The Foreign Policy Process in Britain”, before he started work—so I know a little about it.

I emphasise there has always been, and remains, a difference between the approach to foreign policy in the security sense and defence sense—in which it is quite clear one has to have command, central control and therefore real concern about sovereignty—and to trade policy, international investment and procurement, which are usually controlled by a different department, often in competition with the Foreign Office, and in which subordinate entities of government, in most states, also have degrees of latitude. The German Länder pursue different international investment policies. I remarked earlier that the British Government are negotiating trade deals with Washington state, Texas and others within the United States. The idea that all foreign policy in the broadest sense, from immigration through to defence, has to be undertaken by central government is an extreme sovereigntist and unionist case, which I think should not hold.

[Baroness Chapman of Darlington (Lab)]

My Lords, I will be very brief. I do not want to repeat some of the excellent points made, but I do have an amendment in this group about requiring a legislative consent Motion. For us, this is primarily an issue of respect. It saddens us: from the internal market Act, relationships between the UK Government and the devolved Governments started to go really badly wrong. It seems to happen again and again. I remember a couple of weeks ago, in this Chamber, the noble Lord, Lord Moylan, referred to the Welsh Government’s desire to work to support the Welsh language as a fascist attitude. That has played on my mind ever since. Things have really deteriorated to such an extent that, in the personal relationships between politicians in the UK Government and the devolved Governments, which politicians used to take pride in putting some effort and work into, nobody seems to even try anymore. Bills such as this one come along where the Government do not seem to care whether it has any legislative consent and do not even try to persuade their colleagues in the devolved Administrations to see the benefits of a particular piece of legislation. That is very sad. I regret that deeply, and the Government really ought to do better.

This is primarily about freedom of expression for people who have been elected in their own right to represent their communities. It is wrong that Clause 4 prohibits statements. We will come on to that later, but they are to be gagged by the Bill, and that is to be regretted. It is a backwards step. We will debate that another day. I hope that noble Lords will understand just how offensive the restrictions in that clause are to elected Governments in Scotland, Wales and Northern Ireland.

As others have said, the Bill is disproportionate and unnecessary. The Minister and I have had exchanges about things raised by the noble Lord, Lord Foulkes, about the Scottish Government having offices in other nations, and he says that this is wrong because foreign policy is the UK Government’s domain, He is right about that—he does not speak for the Labour Party on these issues and is not right in the complete sense on the points that he makes on this. The Government agree and say that this is a terrible problem, that it is confusing for our partners overseas and that something should be done, but they are doing nothing about it. Instead, they feel that this is causing confusion in foreign policy. I just do not believe it. I do not believe that any other Government anywhere in the world is confused about our foreign policy because of some statement that the noble Baroness, Lady Noakes, says has been put in a drawer somewhere in Edinburgh, was passed 10 years ago, and is somehow causing such diplomatic confusion. I do not see any evidence of that whatsoever.

It is sad that the Government no longer even try to pretend that they want to work in partnership with devolved Governments. We can do so much better. The UK Government already have sanctions powers, and they are now seeking unnecessarily to fetter and gag devolved Governments. This shows a terrible lack of respect and I regret it very much.

Cabinet Manual

Lord Wallace of Saltaire Excerpts

Monday 25th March 2024 Lords Chamber

[Baroness Neville-Rolfe (Con)]

There are a lot of good quotations, both from my noble friend the Foreign Secretary and from the noble Lord, Lord O’Donnell, himself. The existing Cabinet Manual, although it needs changes, actually contains a lot of good and enduring material. We need to make sure that the new version is right: it needs to be accurate, up to date and authoritative, and work continues.

[Lord Wallace of Saltaire (LD)]

My Lords, in due course there will be an election. There are probably only four months more of parliamentary sitting before we reach the general election. In saying that these things will be done in due course, are the Government kicking the can down the road until the election reaches us, or do they actually want to ensure that the Cabinet Office contributes to the principle of good government for whichever Government come in after the coming election?

[Baroness Neville-Rolfe (Con)]

As far as the manual is concerned, the Government, as I have said, are considering options on timing and content in the light of the debates that have been had. As far as good government is concerned, we try every day to ensure that we are delivering the right things for the people of Britain and that hard work is rewarded.

Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Wallace of Saltaire Excerpts

Committee stage
Wednesday 20th March 2024 Lords Chamber

Moved by

[Lord Wallace of Saltaire]

1: Clause 1, page 1, line 7, leave out from “the” to the end of line 8 and insert “political or moral disapproval of foreign state conduct was the primary or sole factor in the decision”
Member’s explanatory statement
This amendment would clarify that political and moral disapproval must be seen to be a central factor and not a supplementary consideration in any relevant decision.

[Lord Wallace of Saltaire (LD)]

My Lords, as we are starting Committee, I will say a few things about how we should handle the Bill from now on. After Second Reading and the Commons stages, during which there were a large number of sharp criticisms from Conservatives, as well as others, about the quality of the drafting and the coverage of the Bill, I would have expected the Government, between Second Reading and Committee, to have produced a number of government amendments to clarify some of the many imprecisions in the Bill and perhaps to have arranged to meet some of us who had spoken at Second Reading. I am sorry that that has not happened, and I very much hope that, between Committee and Report, the Government will respond to some of the criticisms by bringing forward clarifying amendments, and that the Minister and the Bill team will be willing to meet with us to discuss some of the arrangements.

The lack of engagement is troubling, and the absence of government amendments at this stage is extremely worrying. I recognise that this is very much a Michael Gove Bill and that he, as Secretary of State, probably wishes to get it through, if possible, without amendment. But here we are in the amending House, and the Minister also has a duty, as a Lords Minister, to listen to and engage with the reasoned criticisms made of the many highly imprecise elements in this Bill, and to respond.

I have two amendments in this group. One raises the question of what is meant by “political or moral disapproval”, and whether the word “influenced” in the phrase

“influenced by political and moral disapproval”

is sufficient. The second, Amendment 6, refers to

“any person seeking to persuade the decision-maker”,

as well as the decision-maker.

As the Minister will know, environmental, social and corporate governance has a long history. It goes back to the Sullivan principles from the United States, which I am sure she will remember. They were formulated by Mr Sullivan, a director of General Motors, in the context of apartheid South Africa and set out a number of principles that companies and others should follow when dealing with investments and procurement. Those principles have since expanded into the whole ESG dimension, which we see actively discussed in Britain, the United States and a number of other market economy countries. The right wing in the United States is busily attacking them in favour of what one has to describe as an amoral capitalism, in which profit is the only thing you are ever allowed to think about. I recall that the first person who started attacking the Sullivan principles was Professor Milton Friedman, who strongly believed that companies have no other duties than to pursue the greatest profit possible for their shareholders.

We need to know what is meant by

“influenced by moral or political disapproval”.

My Amendment 1 suggests that it has to be very considerable in order to be a primary cause of the decision, not simply something that comes in as, or can be argued under Clause 5 to have been—we will get to that later in terms of judicial review—part of the reasons why the decision was taken.

One of our many worries about the Bill is the extent to which it opens the door to litigation through a great many of its imprecise terms. The question, therefore, is whether or not any indication of political or moral disapproval begins to get captured under the Bill, or whether this has to be the major reason why such a decision is taken.

I was very struck as I went through the impact assessment and the Explanatory Memorandum by the sheer lack of evidence that much of this has happened. We find a reference to a council that in 2014 discussed whether or not to, and that another council in 2016 discussed whether or not to. Neither of them actually did it, but they discussed it. “That is wrong and we should stop them doing things like that” seems to be a pretty thin basis on which to mount a Bill that has the sorts of penalties which this Bill begins to set out. That is very much part of our concerns.

Amendment 6 raises the question of whether it is not only the decision-maker who is going to be liable but

“any person seeking to persuade the decision-maker”.

Does that mean that the Guardian journalist who writes an editorial suggesting that this should be done is going to be caught by it? Does it mean that the lobby group that sends things to the decision-maker is going to be caught by it? Does it have to be a more direct approach? How do we identify that “any person”? This is the sort of drafting that should not appear in a Bill before this House. It has to be clarified or we shall do our utmost to remove it. I beg to move.

[Lord Palmer of Childs Hill (LD)]

I speak to exactly the same issue as did my noble friend. Mine is a simpler amendment. I work on the basis that the Bill will pass in some form or another and if one does a modest, sensible tweak to a Bill, it has a chance of being incorporated into the final version. My Amendment 2 —purely adds one word: “materially”. This would raise the threshold that needs to be met before a decision is deemed to be in breach of this prohibition. If it is not “materially”, things could be prohibited for something very minor. Having “materially” improves the Bill and makes it more logical—we are looking at things of substance, not things that are minor.

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[Baroness Neville-Rolfe (Con)]

The noble Lord is right—student unions are not covered, and I think that I made that clear at Second Reading. It is private activity. Clearly, what matters is the influence on public bodies, which is what we are discussing today.

To come back on the Occupied Palestinian Territories, obviously the Government recognise the risks associated with economic and financial activities in those settlements. We do not support boycotts of the Occupied Palestinian Territories. Such boycotts are inherently divisive and could lead inadvertently to negative effects on Palestinians as well as undermining the aim of this Bill, which is to ensure that the UK speaks with one voice internationally. That does not change existing government guidance on doing business in those territories. The Government do not recognise the settlements as part of Israel, as the noble Lord knows, and we have already moved to ban those responsible for violence in the West Bank from the UK—there have been some recent sanctions.

I have tried to answer the probing amendments. I hope that this provides noble Lords with clarification and a rationale for the scope of Clause 1, and I ask the noble Lord to withdraw his amendment.

[Lord Wallace of Saltaire (LD)]

My Lords, I am slightly better informed. We have many difficulties with this Bill. I must say that it would be much easier if it were simply a Bill about boycott of Israel and mainly about sanctions. It would be narrower, and we would know what we were talking about. But it is a Bill that is supposed to apply to every single foreign state in the world except for Ireland, which raises very large questions.

I disapprove strongly of the Rwandan Government’s support for M23 in the Congo civil war, and I disapprove very strongly of Myanmar’s behaviour towards the Rohingya, et cetera. Clause 1 is entitled “Disapproval of foreign state conduct prohibited”, which is itself a very uneasy label and not the sort of thing that ought to appear in legislation. I believed that I lived in a liberal democracy in which government’s reach was limited and free speech, as Conservative Peers are always telling us, is entrenched, and one is allowed to dissent. This appears to be extending the reach of government.

I appreciate that this is a DLUHC Bill that is aimed primarily at local authorities, although it is extended to include universities—and whether it includes student unions we will investigate further. As it happens, I had the current president of the Cambridge Students’ Union here last Wednesday, and I showed him a copy of the Bill—and he was convinced that it would apply to student unions; it is quite clear that some people would like it to do so.

There is a great deal more that we need to find out about all this. The closing down of public debate that the Bill implies is something that worries all of us a great deal. I am happy to withdraw my amendment for a moment, but we shall return to all these questions extensively as we move from one imprecise clause to another.

Amendment 1 withdrawn.

--- Later in debate ---

[Lord Wallace of Saltaire (LD)]

My Lords, I am an academic and, in the course of my career, I have been an associated member of three colleges in Oxford and Cambridge. One has a governing body in the mid-30s; the second has one of around 50; and the third has one of nearly 100—much too large, I quite agree. The chilling effect of this clause on those three colleges would be considerable, precisely because it is not entirely clear what it means by the individuals who make the decision for the decision-maker. That requires a great deal more clarification; at the very least, it ought to be in the Explanatory Notes. This is another attempt to ask the Government to come back with something which is a great deal clearer.

In my career, I have also been a historian and an analyst of foreign policy. It is an area in which we spend an awful lot of time defining, discussing and describing decision-making. We very often disagree sharply with each other because it is very difficult to define, for example, exactly who took the crucial decision that started the First World War. Baroness Henig, sadly no longer with us, wrote several books on the subject. The noble Lord, Lord Roberts of Belgravia, has written several books entirely disagreeing with what other historians have said about various crucial decisions.

That is, again, part of our problem: when a complicated decision is taken, who takes it? How many people are complicit? If you are a member of the council committee which takes the decision and you abstain on the vote—or vote against it—are you also part of the decision-making or not? There is, to say the least, a cloud of uncertainty around this phrase. Perhaps the noble Lord, Lord Wolfson of Tredegar, understands it; I must say that I do not.

[Lord Johnson of Marylebone (Con)]

My Lords, I would also like to probe a little more on the meaning of “decision-maker” in a higher education context, following on from the excellent speech by the noble Lord, Lord Wallace.

Universities are often very decentralised in their structures, and power can be distributed quite far and wide. It is not always concentrated in the vice-chancellor’s office; nor is the governance of universities often as clear- cut as it might be. I would appreciate some clarity as the Bill proceeds on who exactly is going to be identified as the decision-maker in particular situations. Do we mean specifically decisions taken by the executive management team of an institution, principally the vice-chancellor? Do we mean, for example, student unions?

I noted that in my noble friend the Minister’s response to the noble Lord, Lord Mann, that student unions were—if I heard her correctly—out of scope, because they are private bodies. This confuses me a little, because I thought the whole purpose of the Bill, from a political point of view, was to address precisely this issue: student unions getting on their soapboxes and making statements about BDS, and all the rest of it. If they are out of scope of the Bill, I really wonder why universities as a whole are still in scope. It is not the vice-chancellors, academics or heads of department who are making these kinds of noises; it is the student unions. If I understood my noble friend the Minister correctly, they are not even covered. I really question why universities are still in scope at all, but that is a question we will come to later in Committee.

The final point on which I would like some clarity from my noble friend the Minister is whether a decision-maker will also be deemed to be an individual academic, who may manage a research budget. Will the use of that research budget by the individual academic be part of the decision-making process captured by the Bill? If so, how will that be squared with the legal duties on the OfS, among others, to promote academic freedom and freedom of speech in our higher education institutions?

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[Lord Verdirame (Non-Afl)]

My Lords, I have just a few points and questions, following the discussion we have just had. The first point is to seek clarity on whether my understanding of the last three lines of Clause 1(7) is correct. I understand those three lines simply to be saying that, where the decision-maker is a collegiate body, the duty to have regard applies to the individuals within that collegiate body who are taking the decision. That is how I read those three lines, but I may be missing something.

The second point arises from the comment that the noble Lord, Lord Johnson of Marylebone, made about universities. I suppose it is a point that comes up both under these amendments but also under the next amendments and in particular Amendment 8. Paragraph 20 of the Explanatory Notes, which speaks to Clause 1, states:

“The ban in Clause 1 is not intended to prohibit a higher education institution from deciding to terminate a collaboration with a foreign university on the grounds of academic freedom”.


I read that as implying that, other than on those grounds, the ban would apply to a decision to terminate a collaboration with a foreign academic institution. I would like some clarity on this, because I was a bit surprised to see that my reading of the definition of “procurement decision” would not necessarily have included a collaboration with a foreign academic institution as a procurement decision. It certainly is not an investment decision, but is a collaboration with a foreign academic institution in scope of the ban potentially? That is what I would like to understand. If so, it raises the question that the noble Lord, Lord Johnson, raised, of whether the individual grant holder who has, for example, a research collaboration with a foreign institution, is within scope of Clause 1. That is not clear to me.

[Lord Wallace of Saltaire (LD)]

My Lords, I have had advice from a professor of law at Cambridge University that it is not within scope where the research funding is not public. It is then a private act, not a public act.

[Baroness Janke (LD)]

My Lords, very many points have been made about how the decision-maker is established. From the point of view of local government, in local councils there are very many ways of taking decisions that can be individual or corporate. The tiers of responsibility and the trails that decisions make throughout a large organisation would need to be explored if enforcement action was to be taken.

In addition, councillors, committees or even pension committees, as we heard earlier, are advised by experts and independent advisers, so it is not clear where the line of accountability is and who is responsible, who is to be identified for enforcement action. The public authority, as has been identified earlier, is the body that is talked about in relation to Clause 4, but it is not in the Bill and does not relate to any other part of decision-making. I add my plea for further clarification as to how the decision-maker is to be identified and how enforcement is to be pursued in light of that.

As far as pension funds are concerned, as a former member I know that expert advisers do take account of political situations in their evaluation of risk. Again, that may be intimidating for councillors or advisers and inhibit the quality of advice that is given.

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[Lord Wallace of Saltaire (LD)]

My Lords, I shall speak to Amendment 8. I declare an interest: I have two children, both scientists, working in universities. My son runs a microbiology laboratory at Edinburgh University that has a number of international research partnerships, including with Israeli academics. I am unaware, from everything my children have told me, that anyone is boycotting contact with Israel in microbiology. There are some highly regarded Israeli scholars who take part in a whole range of things.

There are course problems in some research partnerships with Chinese academics, sometimes now with Russian academics and sometimes with academics from particular Middle Eastern countries. One has to leave it to those who are running laboratories, which are highly international—I think my son currently has people from four different countries in his—because these matters require delicate arrangements. When it comes to the social sciences, particularly if you are teaching international relations and have a lot of research students, as I used to, and you are sending them out to study Saudi, Egyptian or above all Chinese issues, you are in really delicate areas.

I emphasise that any of those are private acts of a university—commercial partnerships most of all. When that gets into the question of how far we want the Government to interfere in the autonomy of universities, we do not always get it right. There have been research students and young scholars who have been imprisoned in the Emirates or imprisoned and killed in prison, as in Egypt. On one occasion I had to approach one of the intelligence agencies about some of our students at the LSE, immediately after 9/11, because some people had lost confidence in the people with whom they were dealing. That has to be left to the judgment of universities. I do not think there is a problem there, and I am therefore unhappy about the idea that Amendment 8 should be included within the scope of this Bill.

[Lord Johnson of Marylebone (Con)]

My Lords, while I am sympathetic to the intentions of Amendment 8, tabled by the noble Lord, Lord Mann, I wonder if it is ultimately going to be necessary, given that the Higher Education and Research Act 2017 gives the Office for Students powers to take action whenever an institution is in breach of the public interest principles it is required to uphold.

One of those principles relates specifically to academic freedom and the issues to which the noble Lord was referring with respect to Israel. All academic staff at an English higher education provider have freedom within the law to question and test received wisdom, and to put forward new ideas and controversial or unpopular opinions, without placing themselves in jeopardy of losing the jobs or privileges they may have at that provider. I think that essentially covers the points he was making in respect of academics being prevented from pursuing partnerships or research with universities in Israel or with Israeli academics. We have these provisions in law and the Office for Students has all the powers at its disposal to enforce them. So I am not sure that Amendment 8 is entirely necessary, although I understand why he tabled it.

--- Later in debate ---

[Baroness Neville-Rolfe (Con)]

My Lords, I thank the noble Lord, Lord Mann, for drawing the House’s attention to two important issues with his Amendments 8 and 9. Like my noble friend Lord Pickles, who it is a real pleasure to welcome to our debate, my noble friend Lord Wolfson of Tredegar and the noble Lord, Lord Collins of Highbury, I am really grateful for all the work that the noble Lord, Lord Mann, has done.

My noble friend Lord Pickles and I worked together in my retail days, when he was a leading influence in local government and I worked to have kosher and halal food in many of the Tescos that were spreading across the country. So there were lots of conversations over food. A focus on community concerns is what much of the probing has been about this evening—but that is for another group.

I remain of the view that we need to apply this Bill to universities as we are doing, and I am committed to having a comprehensive debate and discussion on the impact of the Bill on universities at the appropriate moment later in Committee.

As we have heard, the two amendments in this group would add two stipulations to Clause 1. Amendment 8 intends to ensure that the prohibition applies to a decision made by a university to enter into a commercial partnership with another university or research university in a foreign state. The prohibition in the Bill already covers higher education providers in their public functions, including when their procurement and investment decisions form part of a research collaboration. Decisions relating to a commercial partnership are, however, likely to constitute a private function—for example, a decision relating to a research partnership to develop a new product funded by a pharmaceutical company. The ban applies only to public authorities’ public functions, as we have heard, and private decisions are rightly out of scope of the Bill. I note what the noble Lord, Lord Mann, says, but it would be inappropriate to apply the ban to private functions, and it would take the Bill beyond the manifesto commitment.

We have been clear in the Explanatory Notes that Clause 1 is not intended to prevent a higher education provider deciding to terminate a collaboration with a foreign university on the grounds of academic freedom, if they deem it necessary in line with their statutory duties in Part A1 of the Higher Education and Research Act 2017 or other legislation. The Bill is about ensuring that universities and higher education institutions do not have a corporate view on a particular matter of foreign policy when making their investment and procurement decisions. It is right that the Bill does not stray into decisions that could threaten academic freedom, as helpfully highlighted by the noble Lord, Lord Stevens of Birmingham, who spoke at Second Reading. I am sympathetic to the points that the noble Lord, Lord Mann, is making, and the Government do not support academic boycotts, but this Bill rightly does not interfere with academic freedom or private activity.

I turn to the points made by the noble Lord, Lord Mann, about the Jewish community’s support for this Bill. The Jewish community in the UK is widely supportive of the Bill as drafted. Russell Langer, head of policy at the Jewish Leadership Council, provided the following statement in support of the Bill’s restriction on universities’ economic activities:

“Higher education institutions continue to come under pressure to adopt BDS policies ... This legislation will be a valuable tool in assisting our higher education in rejecting this effort”.


The Bill will sit alongside other measures that the Government are taking to protect academic freedom. The Higher Education (Freedom of Speech) Act 2023 will ensure that freedom of speech is protected and promoted within higher education in England, and it will strengthen existing freedom of speech duties and directly address gaps in the existing law. Without action to counter attempts to discourage or even silence unpopular views, intellectual life on campus for staff and students may be unfairly narrowed or diminished, which is why there was a commitment in the 2019 manifesto to strengthen this.

[Lord Wallace of Saltaire (LD)]

The Minister has just said that we need legislation to silence unpopular views. I have to say that, as a liberal, I find that one of the most illiberal things that we could consider doing. Did she mis-speak?

Scottish Government: Devolved Competences

Lord Wallace of Saltaire Excerpts

Wednesday 13th March 2024 Lords Chamber

[Baroness Neville-Rolfe (Con)]

I hear what the noble Lord says, but these are matters for the Scottish Government to answer. No doubt Scottish taxpayers will reflect on whether the donation to UNRWA was justified.

[Lord Wallace of Saltaire (LD)]

My Lords, despite our having some years of experience now with the devolved settlements, we still have a separate Scottish Office and Welsh Office in London and seats in the Cabinet. The Minister will have seen the arguments made by a number of people on our need for a smaller Cabinet. Would not it be sensible now, in making sure that the devolved Administrations have a central link with central Government, to have one department for constitutional affairs, rather than a Welsh Office and a Scottish Office with very little to do?

Ministers: Legal Costs

Lord Wallace of Saltaire Excerpts

Tuesday 12th March 2024 Lords Chamber

[Baroness Neville-Rolfe (Con)]

I think the Secretary of State explained very fully. It took the course of two days to draft, clear and send the letter to UKRI’s CEO to ask for an investigation. She highlighted it on X, using the same medium as the original issue.

[Lord Wallace of Saltaire (LD)]

My Lords, may I ask the Minister about the Civil Service dimension of this? It is reported that a number of senior civil servants were working until midnight on a Friday evening on a non-emergency text message that the Secretary of State wished to send. This seems an entirely unreasonable use of civil servants’ time. Civil servants do work out of hours, but only for emergencies. If they are asked to work late into the night and over the weekend, that is an abuse by Ministers of civil servants.

[Baroness Neville-Rolfe (Con)]

The Secretary of State has explained her actions fully. I refer noble Lords to her statement. The important thing is that legal advice was taken, and subsequently there was a full and final settlement of the dispute. The Secretary of State made it clear that she should have sent the letter in confidence to UKRI and apologised for that. The basic principle is that it is very important that Ministers can seek advice on work that they carry out as part of their official duties, otherwise there would be a chilling effect on public life. This has been important to all Administrations.

Economic Activity of Public Bodies (Overseas Matters) Bill

Lord Wallace of Saltaire Excerpts

2nd reading
Tuesday 20th February 2024 Lords Chamber

[Lord Wallace of Saltaire (LD)]

My Lords, when I read through the Commons debates on this Bill, a number of things struck me: the frequency with which MPs of all parties described it as badly drafted, the large number of Conservative MPs who called for substantial changes, and the stubborn resistance of the Secretary of State to any changes. This Bill is ambiguous, confused and contradictory. It is about a specific campaign to boycott Israeli firms and companies based in the Occupied Territories, but it also applies to all foreign countries. It is aimed primarily at local authorities and universities, but it also extends far more widely, across a large and unknown number of public authorities.

Hard cases make bad law. All of us who support the long-term security of the State of Israel are opposed to campaigns to discredit and undermine it. Those of us who believe that a secure future for Israel within the Middle East depends upon permitting a Palestinian state as its neighbour have more doubts about goods produced in illegal settlements, but remain clear that Israel, within its 1967 boundaries, is and remains a trusted trading partner.

The current conflict means that there are passionate views within our society about what has happened on both sides. Michael Gove, nevertheless, has argued that the Bill is needed to maintain “community cohesion”, but the conflict has shown how diverse and divided the British public are on the Israel-Palestine conflict, at the moment. The recent short debate on Gaza, in this House, showed that we are similarly divided.

The Bill is not just about Israel and the Occupied Territories. I will focus on its wider implications. This is not the first time that people in Britain have campaigned against behaviour in territories overseas. In the late 18th century, anti-slavery campaigners promoted the boycott of West Indies sugar. My generation of students boycotted South African oranges and sherry, with student unions raising money to support scholarships for ANC members—at a time when the older generation regarded Nelson Mandela as a terrorist and a communist. Few would now disagree that the younger generation then were right.

The Bill proposes damaging limitations on speaking or protesting against a wide range of potential injustices, based on a single and particularly delicate case. There will be other cases in the future, no doubt, when elements in our civil society campaign against foreign injustice, while the Government remain reluctant to jeopardise trade or intergovernmental relations— in China, Myanmar and elsewhere. However, the Government argue that every aspect of foreign policy must be controlled and directed from Whitehall. As a liberal and a democrat, I insist on the contrary: in a healthy democracy, there should be a lively debate about foreign policy choices, with civil society playing an active role.

The Government also assume that local government is merely an agent of the central state, not to be trusted even to discuss divergent actions. Those of us who believe in an open democracy see strong local government as an essential part of a healthy society, and have watched with horror as Michael Gove and others have undermined local democracy over the past decade.

To me, Clauses 4 and 7 are the most noxious aspects of the Bill. They block discussion of actions against any foreign state. They impact on freedom of speech and extend the powers of the state to inform itself about discussions within autonomous bodies. Clause 1(2) and (7) also inhibit freedom of discussion; the drafting is dangerously authoritarian in tone. I recommend to the Minister the excoriating article that Matthew Parris wrote in the Times two weekends ago, which attacked the Conservative hypocrisy of championing free speech on issues that right-wingers approve of while clamping down on discussion of issues that they dislike.

I emphasise how wide the powers that the Bill gives the Government may reach. Its title refers to “public bodies”, but the text refers mostly to “public authorities”. The impact assessment refers to “hybrid public bodies” and the Explanatory Notes refer to “hybrid public authorities”. I have been advised that there are far more public authorities than the much tighter category of public bodies.

In answering an Oral Question on 23 January, the Minister told us that there are “nearly 100,000 public authorities”, including schools, the NHS and a whole range of publicly funded or partially funded organisations. The Trade Union (Deduction of Union Subscriptions from Wages in the Public Sector) Regulations 2023, a statutory instrument which the Minister took through in December, provided a lengthy schedule, detailing all the

“Persons deemed to be public authorities”

under the regulations, including a list of 200 minor bodies, such as the Social Care Institute for Excellence, the Sir John Soane’s Museum and Worcestershire Children First. No such list is provided here.

The impact assessment for the Bill implies that charities, including student unions, will be caught by the Act. There is a loose and worrying reference to it extending to “cultural institutions”. I have just read the department’s memorandum to the Delegated Powers Committee, which admits that

“the Bill may … capture a range of bodies that it was not necessarily intended to apply to”.

This all leaves plenty of room for ambiguity, confusion and, I suspect, legal challenge. We will certainly wish to query the Henry VIII powers that the memorandum admits the Bill will transfer to Ministers. I note that one of these powers is justified

“because there will be instances where boycotting and divesting will be in line with the Government foreign policy, and therefore the Secretary of State … will need the power … to allow public bodies to boycott and divest if they wish”.

Conservative politicians tell us that they stand for a smaller state and a stronger civil society. What we have here looks like a dangerous extension of state surveillance over institutions that rightly claim a degree of autonomy from central government. It is against everything that Conservatives ought to stand for.

My noble friend Lord Shipley will say more about the implications for local democracy. I will emphasise how the Bill undermines the autonomy of British universities. I declare an interest, as I spent my career in a number of universities. The noble Lord, Lord Willetts, is on record as insisting, as he may confirm, that UK universities are not public bodies, and there are court judgments confirming that. Are universities public authorities? Are the Government now claiming that their dependence on public funding makes them part of the public sector? I remind the House that only 17% of Oxford University’s income comes from domestic student fees and other government grants. For the sector as a whole, public funding is around 50%. Most HEIs are charities, many of them under royal charter, not subordinate agencies of the central state. Will the Minister assure us that her colleague from the DfE will participate in the Committee discussion that refers to universities, to assure us that there is cross-government consistency on what this Bill intends?

Clause 6 makes the Office for Students the enforcement authority for the higher education sector. I hope the Minister is aware of the recent report on the OfS from the Industry and Regulators Committee of this House, which is highly critical of its capacities and ability to balance its different tasks. The Higher Education (Freedom of Speech) Act 2023 has just added an extra section to the OfS, under a “free speech champion” and staff. In direct contradiction to that new responsibility, this Bill would require the OfS to restrict freedom of speech on overseas matters.

A recent Universities UK survey did not find any higher education institution that has imposed a boycott or sanctions related to a foreign state, or recently come close to doing so, so what is the case for including universities within this Bill? A Government who preach deregulation wish to impose extra burdensome regulation, including the threat of large fines, on one of our country’s most internationally respected sectors. Clause 7, which one Conservative MP in the Commons described as introducing “thought crime” to UK legislation, is a massive intrusion on the principles of academic freedom and university autonomy.

I have some sympathy for the Minister in having to take through a Bill that offends against so many Conservative and democratic principles. She will be aware of the strong criticisms that Conservative colleagues in the Commons have made. The chair of the Foreign Affairs Committee noted

“the concerns emanating from the Foreign Office and from diplomatic posts.—[Official Report, Commons, 3/7/23; col. 605]

and the incompatibility of Clause 3(7) with UNSC Resolution 2334, which British diplomats drafted. The chair of the Public Administration Committee referred to advice from FCDO lawyers that Clause 3 would place the UK in breach of that resolution. A former Secretary of State for Education tabled a number of amendments, which the Government would have been wise to accept. Both the co-chairs of the All-Party Group on British Jews—one Conservative, one Labour—strongly criticised the Bill.

The Bill has arrived from the Commons unamended, in spite of those well-founded criticisms. It is our duty to challenge the contradictions it contains and the damages it threatens. The Minister must recognise her duty to engage constructively, and to ensure that it will not leave this House before it has been significantly reshaped.

--- Later in debate ---

[Baroness Neville-Rolfe (Con)]

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

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

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

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

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

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

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

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

[Lord Wallace of Saltaire (LD)]

My Lords, regarding public investment and private investment, a lot of our universities have very substantial endowments. Will the Minister clarify that these are well outside the Bill’s remit? When they take decisions on investment and procurement from their private investment funds, they are acting privately and not publicly.

[Baroness Neville-Rolfe (Con)]

That is my sense, but I will obviously check where we are. I would also make it clear that things such as conference centres and so on are obviously outside the remit. I will come back to the noble Lord on the exact definition, if I may, and we can perhaps discuss it in Committee in any event.

I will now address concerns that this Bill represents a change in the UK’s foreign policy. The noble Baroness, Lady Kennedy of The Shaws, and others, will be pleased to know that the Government have been clear throughout the Bill’s passage that nothing in this Bill changes the UK’s position on Israeli settlements. They are illegal under international law, present an obstacle to peace and threaten the viability of a two-state solution. The Government continue to urge Israel to halt settlement expansion immediately.

I reassure the House that the Government’s assessment is that the Bill distinguishes between Israel and the territories it has occupied since 1967. It is therefore compliant with UN Security Council Resolution 2334. The Government believe very strongly in the importance of complying with international obligations under the UN Charter.