Trade Bill

Viscount Trenchard Excerpts

Committee stage
Thursday 15th October 2020 Lords Chamber

[Baroness Noakes (Con)]

My Lords, I want to comment on three amendments in this group. First, on Amendment 81, I will echo some of what my noble friend Lord Lansley has said. As I understand it, the Board of Trade is composed only of privy counsellors, and I believe they are normally Cabinet Ministers. The noble Baroness, Lady Bennett of Manor Castle, read out its full title, and I think embedded in there is “privy counsellor”. It would be wholly inappropriate for Parliament ever to be involved in the appointment of privy counsellors to a body.

As we have heard, particularly from the noble Baroness, Lady Bennett, what people are really upset about is the appointment of Tony Abbott. But he is, of course, an adviser to the Board of Trade, and I do not think there is any precedent for Parliament to be involved in the appointment of advisors or for the normal public appointment processes to apply necessarily to advisers. So I would not support Amendment 81 at all.

The noble Baroness, Lady Bowles of Berkhamsted, has said most of what I wanted to say in respect of Amendment 106. I would like to underscore that I do not think that boards of bodies such as the TRA should have representatives on them. The board is a place where the governance of the body is played out, which is why there is a majority, under the schedule, of non-executives. It is important to remember that it is not there to bring a particular point of view, but to make sure that the body is itself well managed and well governed. The issue about bringing stakeholder interests to bear should be covered either by committees —whether we need a special committee to be hard-wired into the schedule or the TRA can use its committee power in the schedule—or, more probably, by ensuring that there are proper mechanisms for consultation in the formulation of any policy. I do not believe we should be using the board in that way. I also note in passing that the representatives are to include each of the United Kingdom devolved Administrations, which leaves England out in the cold. There is no representation for England, which is often one of the failings of devolution—having representatives from the devolved Administrations but forgetting that England is also rather important.

Lastly, Amendment 107 would require the House of Commons, via its International Trade Committee, to consent to the appointment of non-executives to the body. Again, this is unprecedented. It is normal nowadays—although it used not to be—for the chairman to be put through a process, either pre or post-appointment, but I do not think that there is any precedent for the Commons to start approving individual members of public bodies. It is unnecessary and cumbersome to clog up committees by getting involved in the many kinds of individual appointments that are made to public bodies.

[Viscount Trenchard (Con)]

My Lords, I have listened to the speeches of the noble Lord, Lord Bassam of Brighton, and the other two proposers of Amendment 81, which seeks to restrict appointments to the Board of Trade. As my noble friend Lady Noakes has pointed out, I think that he intended his amendment to apply to advisers to the Board of Trade. It must be most discouraging for new appointees as advisers to the Board of Trade to hear the criticism of their suitability. I agree with my right honourable friend the Secretary of State that the new Board of Trade should be well advised by experienced people who can make the case for free and fair trade across the UK and around the world. I am happy to see that Tony Abbott, Daniel Hannan and others have been appointed, and I disagree with those who say that people who hold different views on social issues unconnected with trade should not be appointed to such positions. There is, at the present time, great global insecurity as a result of the Covid-19 pandemic. More than ever, the UK needs to be a strong voice for open markets and for reshaping global trading rules, together with countries such as Australia, with which we expect to soon agree on the terms of a new free trade agreement.

In response to the suggestion that appointments to the Board of Trade should be made subject to the Governance Code on Public Appointments, I would say that perhaps the governance code is too restrictive and generally leads to the selection of a particular type of person, excluding those who are able to think outside the box and suggest innovative solutions, rather than those who resist change to practices that will not work well for global Britain in future.

Amendment 83, in the name of the noble Lord, Lord Stevenson of Balmacara, seeks to increase the influence of trade unions over the trade advisory groups. This amendment is also unnecessarily prescriptive, especially as there are representatives of each of the four nations’ national farmers unions on the Trade and Agriculture Commission beside the representative of the Farmers’ Union of Wales. Besides, the further attack on the Government’s prerogative powers on treaty negotiations by exposing day-to-day salient developments in trade negotiations to public scrutiny would seriously detract from our negotiators’ ability to represent British interests successfully.

Amendment 106, in the name of the noble Lord, Lord Stevenson of Balmacara, also unreasonably seeks to restrict the Secretary of State’s ability to appoint the board of the Trade Remedies Authority. It is notable that the noble Lord does not think it so important to include people with experience of international trade disputes and business as he does representatives of his four chosen categories. I tend to agree with what the noble Baroness, Lady Bowles of Berkhamsted, said in this regard. However, I suggest to the Minister that it would be better if the chief executive and both executive and non-executive directors were appointed by the chairman with the approval of the Secretary of State. This would result in better corporate governance and lead to smoother functioning of the board.

I agree with the noble Baroness, Lady Kramer, that her Amendments 110 and 111 would be improvements to the Bill. I agree with the intention of her Amendment 112, and I agree with my noble friend Lord Lansley, in his Amendment 113, that the annual report should be as informative as appropriate. Perhaps the Minister could suggest some suitable amendments to that effect, even if he considers these particular amendments to be too prescriptive.

[The Deputy Chairman of Committees (Baroness Garden of Frognal) (LD)]

I shall now try and call the noble Lord, Lord Judd. Are you there, Lord Judd?

--- Later in debate ---

[Baroness Bowles of Berkhamsted (LD) [V]]

My Lords, I share the concern of the noble Lord, Lord Bassam, and the noble Baroness, Lady Noakes, about the creeping power of HMRC to demand information, potentially from anyone, without any controls or supervision. I am a member of the Finance Bill Sub-Committee, and this is a matter that we, too, are investigating in our current inquiry.

Here in the Bill there is another swathe of powers, or potential powers. I am not against powers to investigate or to make sure that any taxes due are properly paid; the problem comes with generalised powers that can then be used beyond what might be called their proper limit, or exercised by individuals at relatively junior level without appropriate training. We have seen that before. HMRC also has a track record of being rather heavy-handed on innocent or easy victims—as with the loan charge—and missing the big fish.

Against that background, Clause 7 is drawn too wide. Clause 7(1), which kicks off the provision, is worded to cover any person. It is not limited to whether they have an interest or are connected in any way with the trade, business or profession. It could enable fishing anywhere—and potentially compulsorily under regulations made via Clause 7(3). Clause 7(3) also seeks to be able to amend Acts of Parliament on the type of information required and how the request is to be made, again without limitations. If it follows HMRC’s present trend, that could include seeking the disclosure of information that would normally require the approval of a court. I expect that that is intended, as it is in the current Finance Bill. That is already unacceptable, but at least it is in a Bill; it would become even more unacceptable were it done by regulation.

Once HMRC had got such information, Clause 8 would permit it to allow the onward disclosure of that information—again, at HMRC’s own discretion—which should not be allowed, and most certainly not in blanket form.

[Viscount Trenchard (Con)]

My Lords, I support Amendment 84 in the name of my noble friend Lady Noakes, which she moved so eloquently. Like her, I am a strong supporter of the Government’s trade policies, but I share her wariness about the Bill’s powers to require disclosure of information. I believe that it is not the kind of thing a Conservative Government should do, in so far as those powers go beyond what is absolutely necessary.

I also agree with my noble friend’s Amendment 87, and I ask my noble friend the Minister to explain exactly which other functions the Government had in mind when they drafted the rather convoluted language of subsection (2). I also agree with my noble friend’s Amendment 88. Why does the Minister think that HMRC should have the power to disclose what may well be sensitive information, the disclosure of which might have an anti-competitive effect?

I also have some sympathy with Amendment 85 in the name of the noble Lord, Lord Bassam of Brighton. Can the Minister explain in what circumstances he thinks it would be necessary and reasonable to use this Henry VIII power?

[Lord Grantchester (Lab)]

My Lords, I thank the noble Baroness, Lady Noakes, for her Amendment 84 in this group, as it gives the Committee the opportunity to examine again the powers being taken by the Government and their agencies in the Bill and whether they are being drafted too widely. The noble Baroness asked some very pertinent questions about the powers being given by the Government to HM Revenue and Customs, not only regarding the compulsion with which any person must comply and the comments made in the other place but on whether this will become a general trawl for all sorts of commercially sensitive data. Under Clause 7(3)(a), regulations may be drawn rather more widely than is considered appropriate.

I will speak to Amendment 85, in the name of my noble friend, Lord Bassam of Brighton, which raises the issue that secondary legislation does not and should not have the power to change primary legislation. Clause 7(4) does this, “among other things”. Paragraph 71 of the Explanatory Memorandum explains that this power is needed to make amendments to the tax primary legislation in order to allow tax returns

“to be amended to include the request for exporter information.”

This probably brings us back to Amendment 84 and compulsion. Would it be an offence to mark the question “not appropriate”? When the words “among other things” are used, how far does that go? If the power is necessary, surely it can be made quite simply in the next Finance Act, maintaining constitutional propriety.

As this is a probing amendment, there is no need to press the point regarding Clause 7(5). Your Lordships’ Delegated Powers and Regulatory Reform Committee did not draw anything in the Trade Bill to our attention, although the Constitution Select Committee discussed the Bill at length in its 15th report. While that committee focused primarily on the Trade Remedies Authority and the devolved Administrations, it drew attention in general to the Government taking presumptive rather than explicit powers. It did not specifically draw attention here to Clause 7, even though powers over taxation have a long history. The Committee needs to seek further clarification and detail on the exporter information being requested in the clause. Can the Minister clarify whether this will be purely financial and whether any guidance on the matter will be published? Could not this information be acquired in a separate request, apart from a person’s tax return? Clause 7(1) seems to suggest that the information required is merely to establish the number and identity of exporters. Is this heavy-handed approach therefore appropriate? I suggest that the information sought goes somewhat wider than that.

The noble Baroness’s Amendments 87 and 88 return to the extent and the wide-ranging nature of the powers. Other speakers in this group have outlined the importance of data to companies. The noble Baroness, Lady Neville-Rolfe, confirmed that data can and does go astray. In a later group we will discuss wrongful disclosure. The noble Baroness, Lady Bowles, spoke against allowing disclosure to be wholly at the Government’s discretion. There are some serious questions here, and I await the Minister’s further comments.