Economic Activity of Public Bodies (Overseas Matters) Bill (Fourth sitting)

Wayne David Excerpts

Committee stage
Tuesday 12th September 2023 Public Bill Committees

[Chris Stephens]

It gives me great pleasure to follow my hon. Friend the Member for Airdrie and Shotts, who is taking over as the levelling-up spokesperson after this Committee. I want to support her amendments for several reasons. First, procurement is devolved to the Scottish Parliament. That is clear, as we heard in the evidence sessions in the questions asked not just by myself but by my Labour colleagues around the effects of procurement in the devolved Administrations.

There is real concern that the Bill seems to override the devolved Parliaments in this area. The devolved Parliaments clearly and correctly suggest that they would want to use their procurement in an ethical way. The problem that we have, of course, is that witness after witness was saying, and those speaking on behalf of the Bill were saying, “It’s up to the Westminster Government to dictate foreign policy.” Well, that gets us only so far. Every local authority that I can recall in Scotland in the lead-up to the Iraq war had a vote on whether it supported the war. Will this Bill seek to stop that sort of activity? Witnesses said last week that this would have stopped what Glasgow District Council did in 1981 in relation to South Africa.

Half a billion years ago, the land masses now known as Scotland and England joined up physically. They are playing a football match tonight. I am quite nervous because Scotland do not do too well against the lesser nations when it comes to football, as we know, but we will see what happens tonight.

We have to be very clear here. The Scottish Parliament was reconvened in 1999. Devolution was approved overwhelmingly by the people of Scotland. I do not think that the people of Scotland will take too kindly to a Westminster Government who seek to impinge on the devolved matters and devolved legislation of the Scottish Parliament.

[Wayne David (Caerphilly) (Lab)]

rose—

[Felicity Buchan]

I shall begin by addressing amendments 15 to 17—

[The Chair]

Order. I apologise, Mr David. You had not caught my eye, but you have now.

[Wayne David]

Thank you, Sir George; it is a pleasure to serve under your chairmanship. I would like to speak to amendment 1 and make it clear that it is to clause 17 but there is an opportunity to discuss it at this time because it deals with the issue of devolution. As is very clear, the Bill applies to the whole United Kingdom, but for it to operate in Wales, Scotland and Northern Ireland, certain legislative consent motions have to be agreed under the Sewel convention. That is because the Bill impinges on at least some of the competencies of the Ministers of the devolved institutions. That is made clear by the Library note. There is an impact on the devolution settlement, and it has to be worked through within the context of that settlement.

Amendment 1 makes the process clear, to avoid any misunderstanding. As we know, there have been constitutional debates, even arguments, between the Government here in Westminster and the devolved institutions, particularly the Scottish Parliament. This amendment simply sets out what is legally the case. It is not a contentious amendment. It simply puts in black and white what is the reality and should be adhered to by all parties. The Government had advance notice of the amendment, and there has been some discussion of it. I urge the Government, given that they are adhering to the idea of mutual respect between the institutions of the United Kingdom, to accept amendment 1. It is uncontentious; it is Government policy. It makes clear what the devolved settlement is in reality.

[Chris Stephens]

The hon. Gentleman is making an excellent point. Does he support the position that I laid out, which is that procurement is viewed very seriously by the devolved Administrations and there is concern that the Bill seeks to interfere negatively in that?

[Wayne David]

Many aspects of procurement and other aspects touched on in this Bill are in part devolved to the various institutions. We have a complex mosaic in the UK: the devolution settlements for Wales, Northern Ireland and Scotland are different in several respects. Nevertheless, the overriding fact is that there is definitely an impingement on devolution powers, however they are defined in the circumstances, and the Sewel convention is needed to ensure that there is common agreement on what is being done by central Government.

I refer in particular to the Northern Ireland situation, because we have received written evidence from the chief executive of the Northern Ireland Local Government Officer Superannuation Committee, David Murphy. He makes the point that as far as Northern Ireland is concerned, there is the Public Service Pensions Act (Northern Ireland) 2014, which effectively devolves public sector pensions in large part to the Northern Ireland Assembly. He goes on to conclude, after having described the arrangements:

“It is our understanding that in the absence of the NI Assembly sitting it will not be possible to obtain a Legislative Consent Motion for the proposed legislation.”

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[Felicity Buchan]

If Government sanctions exist, they continue to exist. The Bill is specifically to prohibit divestment and procurement decisions.

I want to address the point made by the hon. Member for Airdrie and Shotts in relation to Russia. I give her my assurance that we will look to introduce a statutory instrument to exempt Russia and Belarus from the provisions of the Bill.

Amendment 30 would remove the decisions of Scottish Ministers from the scope of the Bill, and a carve-out for the decisions of Scottish Ministers would be inserted into clause 2. It is not clear whether the hon. Member for Airdrie and Shotts intends for the amendment to be read alongside amendments 15 to 17. Clause 2 applies the ban in clause 1 only to public authorities, as defined in section 6 of the Human Rights Act 1998. The clause also carefully defines decisions in scope only as those related to a public authority’s investment and procurement functions, which is the point I keep coming back to. I would like to reiterate my response to amendments 15 to 17 by saying it is absolutely essential that the Bill extends to public authorities across the entirety of the UK. That will include Ministers, Departments and agencies in the devolved Administrations, who have also faced pressure to engage in BDS activity.

As I have said, foreign policy is reserved, so it does not trigger a legislative consent motion. However, as the ban applies to the Ministers of the devolved Administrations, this may alter their Executive competence. We have therefore formally engaged the legislative consent process, and I look forward to discussing the Bill further with my counterparts in the devolved Administrations. The Government are not seeking legislative consent for the rest of the Bill’s provisions, as the other provisions do not trigger the legislative consent process.

I was asked specifically about how the Bill affects Northern Ireland. Given the continued absence of the Northern Ireland Assembly and Executive, a legislative consent motion cannot be secured currently. It is important that the Bill applies in Northern Ireland to ensure that the people of Northern Ireland benefit from these important protections. UK Government officials will work with counterparts in Northern Ireland to discuss the Bill’s contents and provisions, along with the Bill’s devolution analysis. We are hopeful that when the Assembly is restored, it will be able to consider and support a legislative consent motion for the Bill.

[Wayne David]

Will the Minister give way?

[Felicity Buchan]

Let me continue.

The Government will continue to uphold the Sewel convention and make sure that the interests of the devolved Administrations, and of people in Scotland, Wales and Northern Ireland, are taken into account. I will address amendment 1 and see whether that answers the question raised by the hon. Member for Caerphilly. The amendment suggests an addition to clause 17 to make legislative consent a legal requirement. Scottish Ministers, Welsh Ministers and Northern Ireland Departments would be captured by the Bill only once that consent is granted by each of the devolved legislatures.

The hon. Member for Nottingham North suggests an amendment that would undermine the principle that the UK Parliament is sovereign. It is not appropriate to write such a political convention to seek consent into the legislation as a legal precondition for the Bill to apply to devolved Ministers. Furthermore, the codification of the Sewel principles, which are already written in statute, is unnecessary. The Lords Constitution Committee recently reported on the issue, stating:

“We do not believe it would be desirable to involve the courts in adjudicating…on the meaning and application of the convention, which are best resolved through political deliberation.”

For those reasons, I ask hon. Members to withdraw their amendments.

[Wayne David]

I thank the Minister for her response. First, as far as Northern Ireland is concerned, my understanding of what she has said is that the legislation will not be applicable in large part until the Northern Ireland Assembly is reconvened and has had an opportunity to discuss with central Government a legislative consent motion. That is my understanding of what she has said. Will she confirm that?

Secondly, on the Sewel convention, it is unfortunate that the Government are not prepared to accept the amendment, because it simply reiterates the reality and provides clarification. I accept that in the Government’s mind it could be a questioning of the sovereignty of Parliament, but I do not think an accurate reading of the amendment will in any way suggest that. It recognises that the legislative consent motion process is well established. The Sewel convention needs to be firmed up, and this is one step in ensuring that the partnership of nations in the United Kingdom is made firmer, not weaker.

[Felicity Buchan]

On the Sewel convention, as I have said, we do not think it is appropriate that that is put into legislation. We feel that that is a political deliberation, but, clearly, the Government are supportive of the Sewel convention. In light of our support of the Sewel convention, we will do everything to work with the devolved Administrations, as we always do in order to try to get an LCM.

On the specific point about Northern Ireland, I want to correct your interpretation of what I said—

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[Wayne David]

May I also ask the Committee to divide on amendment 1?

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[Wayne David]

I beg to move amendment 5, in clause 3, page 3, line 10, leave out paragraph (a).

This amendment removes the existing stipulation that the power to exempt a country or territory from section 1 may not be used in respect of Israel.

[The Chair]

With this it will be convenient to discuss amendment 6, in clause 3, page 3, line 11, leave out paragraphs (b) and (c).

This amendment removes the existing stipulation that the power to exempt a country or territory from section 1 may not be used in respect of the Occupied Palestinian Territories or the Occupied Golan Heights.

[Wayne David]

In its present form, the Bill will introduce a blanket prevention of public authorities’ ability to take into account human rights—the Government would say foreign policy—when making certain decisions. There can be exceptions; we have heard the Government mention Belarus and Russia. Yet for Israel, the Occupied Palestinian Territories and the Golan Heights to be exempted, it is not enough for a Secretary of State to bring forward a statutory instrument; primary legislation will be required.

We have a fundamental problem with the clause, which is the conflation of Israel with the Occupied Palestinian Territories and the Golan Heights. Israel is a sovereign state; the Occupied Palestinian Territories and the Golan Heights are areas that have been occupied since 1967, and the occupation is deemed illegal under international law. In fact, it is not simply international law; the Government themselves have—until now, it seems—held that position very firmly. Let me quote from a fairly innocuous document, the Government’s guidance on overseas business risk, which was only published in February 2022:

“The UK has a clear position on Israeli settlements: The West Bank, including East Jerusalem, Gaza and the Golan Heights have been occupied by Israel since 1967. Settlements are illegal under international law, constitute an obstacle to peace and threaten a two-state solution to the Israeli-Palestinian conflict.”

That has been the Government’s position, clearly and consistently expressed.

[Chris Stephens]

The hon. Gentleman presents a very powerful position. Members on the Opposition Benches have been told by the Government that the Bill should comply with Foreign Office policy. It seems that the Government are now deviating from Foreign Office policy. It should not be one rule for the Government and one rule for every other public body, should it?

[Wayne David]

There might well be something in what the hon. Gentleman suggests. There is, to be honest, a not-too-subtle change in the Government’s emphasis and in their exposition on this matter. Equating Israel and the occupied territories is unique in any British legislation, let alone any Government statement; it questions the long-standing position of the United Kingdom supporting a two-state solution based on 1967 lines.

There is also the question of international law. In his first written submission to the Committee, Richard Hermer KC cited the advisory opinion of the International Court of Justice concerning the construction of a wall in the Occupied Palestinian Territories. In his second written submission, he also made reference to the United Nations.

I respectfully remind the Committee that the UK is a founding signatory of the charter of the United Nations and is obliged to comply with Security Council resolutions. Security Council resolution 2334 very clearly expresses the concern about Israeli settlements in the Occupied Palestinian Territories; I want to emphasise that point. Operative paragraph 1 of the resolution states very clearly that the Security Council

“Reaffirms that the establishment by Israel of settlements in the Palestinian territory occupied since 1967, including East Jerusalem, has no legal validity and constitutes a flagrant violation under international law and a major obstacle to the achievement of the two-State solution and a just, lasting and comprehensive peace”.

Operative paragraph 5 imposes an international-law obligation on all states to ensure that they treat the OPT differently from Israel. It states that the Security Council

“Calls upon all States, bearing in mind paragraph 1 of this resolution, to distinguish, in their relevant dealings, between the territory of the State of Israel and the territories occupied since 1967”.

In summation, clause 3(7) is incompatible with international law, for two very solid, basic reasons. First, it gives special protection to goods and services from both Israel and the Occupied Palestinian Territories. Moreover, it gives greater protection to illegal settlements in the OPT than it does to any other state in the world except Israel. That is quite incredible. If that does not suggest a change in Government policy, what on earth would? It seriously draws into question the Government’s commitment to international law—if that doesn’t, I don’t know what does.

Secondly, clause 3(7) fails to differentiate between Israel and the Occupied Palestinian Territories. I do not want particularly to be in this Committee to make history: I want the Government to say, “Yes, we are being consistent. We have said this all along. We are not nudging Parliament to a change in policy. We are reaffirming where we stand.” That is the right decision to make. I am pleased to say that there has been genuine consensus in Parliament on the issue of Israel and the Occupied Palestinian Territories. I do not want to see that consensus being weakened, and I certainly do not want to see it being shattered. I fear that this legislation is the thin end of the wedge.

[Bob Blackman]

One concern that needs to be looked at is cause and effect. When there have been attempts to put pressure on companies that trade with the occupied territories, it is often Palestinians themselves who lose their livelihood as a direct result. One reason I think this is so important is that it is for the Government to decide this, not for individual public authorities.

The other issue that needs to be on the record is that the occupied territories have been the occupied territories for thousands of years. There has never been a state of Palestine. It has always been occupied by someone. We could go back to the days of the Israelites arriving from Egypt; we could go through the Roman occupation; we could go through the Ottoman empire; we could go through Jordan occupying it until ’67. The reality is that they have never had the ability to exercise authority over themselves. It is very important, when decisions are made on procurement, that we consider all the causes and the direct effects of a decision being made to disinvest from the occupied territories. We owe it to the Palestinians to safeguard their livelihoods and interests. That is one reason why clause 3(7) is so important: it protects them from unintended, although possibly well-meaning, consequences from particular public authorities.