House of Lords
Wednesday 4 November 2020
The House met in a hybrid proceeding.
Prayers—read by the Lord Bishop of Winchester.
Arrangement of Business
The following Act was given Royal Assent:
Prisoners (Disclosure of Information about Victims) Act.
The following Measure was given Royal Assent:
General Synod (Remote Meetings) (Temporary Standing Orders) Measure.
Arrangement of Business
HMS “Queen Elizabeth”
My Lords, HMS “Queen Elizabeth” will sail on her first operational deployment during 2021. Detailed planning continues, but we have yet to announce our programme or destination. A Statement will be made to Parliament in due course, once planning is complete. All Royal Navy deployments and decisions on support are planned carefully, in line with operating environment, and constantly reviewed over time. The first operational deployment programme of HMS “Queen Elizabeth” will be no exception.
I thank the Minister for her Answer. We are in a dangerous world; no one can predict what will happen tomorrow, let alone a few months hence. There are real concerns about Chinese behaviour, and I believe it is right we should show solidarity with our friends in the region. This year, Australia has increased defence spending by a massive 70% and Japan by 8%—a seventh consecutive annual increase. Both countries have cited concerns over China’s aggressive actions. There is a need for strong alliances in the region. Sending a carrier task group is a good way of showing support, but we must not deal in half measures. Since 2010, our military has been grievously damaged. Can the Minister confirm that the “Queen Elizabeth” carrier battle group, deploying to the Indo-Pac region, will have its complete array of ships and aircraft and its air wing, weapons, weapons stocks and support to be able to conduct, if necessary, operations at every level of intensity? Only then can we be sure it will not be called upon to do so.
As I indicated to the noble Lord, I cannot comment on where the “Queen Elizabeth” is going, how she is going to get there or what route she will take. All of that will be unfolded to Parliament in due course. But the noble Lord makes an important point about the purpose of our military and naval capability. Certainly, I want to reassure him that HMS “Queen Elizabeth” will operate as part of a maritime task group, which will include allies and will be tailored to meet the required task. The destinations and precise number and mix of vessels deployed will depend on the operational circumstances in 2021.
My Lords, the deployment of HMS “Queen Elizabeth” to the South China Sea would show that Britain is prepared to make a contribution to the protection of freedom of navigation through the South China Sea, which is vital to protect rules-based free trade in the region. Does the Minister agree that our involvement in naval operations in Asia necessitates not only an increase in joint exercises with friendly nations, such as Japan, but deeper co-operation in procurement? Would she also agree that this strengthens the case to pursue opportunities to collaborate where such countries have similar requirements?
I say to my noble friend that he is correct that the UK has enduring interests in the Indo-Pacific and south-east Asian regions. That is without prejudice to what the “Queen Elizabeth” may or may not do. But he is also correct to identify that we are committed to maintaining regional security, and we are certainly committed to asserting rights to freedom of navigation and overflight, as laid out in the United Nations Convention on the Law of the Sea. We continue to challenge any coastal nation’s excessive maritime claims.
My Lords, the deployment of our carrier strike group next year is to be welcomed. If that is to include the Indo-Pacific, would the Minister confirm that the opportunity will be taken to refresh our ties with the five-power defence arrangements? Would she also agree that, if there are not already plans to do so, there would be great merit in establishing links with the Quadrilateral Security Dialogue, known as the Quad, consisting of the United States, Australia, Japan and India, and that, furthermore, we could act as a catalyst in bringing the FPDA and the Quad together, which would both be beneficial to our alliances in the region?
The noble and gallant Lord identifies a number of significant issues. The unique attributes of the carrier strike group mean that it can provide a global presence wherever the Government require it. The carrier and its supporting ships and aircraft can be configured to support a range of joint operations. We enjoy good relations with the parties to which he has referred and we see our purpose as a global influencer. We will do what we can that is in the best interest of upholding law and setting a good example.
My Lords, if the “Queen Elizabeth” is to be deployed as planned, with all the necessary and vital support, what are the implications for our flexibility and speed of response, and for the role that must be played by the Royal Navy in such a response, if something arises elsewhere in the world? Will we become a bit tied and muscle-bound by where we are down there if we do not have the flexibility to respond elsewhere?
My Lords, the Minister’s predecessor, the noble Earl, Lord Howe, in his inimitable reassuring way used to suggest that the support vessels would come not necessarily from the Royal Navy but from our allies. Have the Government assessed whether the support will be there from our allies in the context of the likely or possible outcomes of the American elections?
The noble Baroness’s crystal ball must be bigger than mine, because the answer to the outcome of the United States presidential election is unclear to me. As she will be aware, the United States is of course a very important ally. It is very significant to our defence relationships across the world. We work with Administrations of whatever hue. That is what we have done in the past and will do in the future.
My Lords, on 13 March last year, during a Question about deploying HMS “Queen Elizabeth” to the Pacific, I said:
“When the Americans deploy a carrier they provide an escort of a cruiser, four destroyers, a carrier wing, a submarine and 7,500 sailors.”—[Official Report, 13/3/19; col. 1019.]
I asked whether Britain can do that. Unfortunately, I am still waiting for an answer.
I am not sure the noble Lord will get one this afternoon, but I will do my best. As I indicated, the carrier strike group is importantly constructed to operate with the support of allies. By way of illustration, within the UK’s capability, the October group exercise brought together all the CSG elements—a carrier, jets, helicopters, escorts and supporting assets. Building on that success, the carrier strike group then participated in the annual NATO exercise Joint Warrior off Scotland, which was a massive exercise and in total involved 6,000 people on land, sea and air. I reassure the noble Lord that the carrier strike group will be a formidable presence.
I thank my noble friend. I am unable to comment in detail as to future deployments for the very same reasons that I am unable to comment in detail on the immediate deployment of HMS “Queen Elizabeth”. He identifies an important point. The south Atlantic is strategically significant and is becoming more so. That is an aspect of our global approach that we keep under constant review.
The Minister will be aware that the proposed deployment of HMS “Queen Elizabeth” was conceived when there were many justified concerns about the overall size of the surface fleet and its ability to meet the Royal Navy’s standing maritime tasks at home and around the world. Can she therefore confirm what risks are likely to be taken against those standing tasks to provide adequate escorts for the deployment of HMS “Queen Elizabeth” next year?
Union with Scotland
My Lords, the Government recognise the importance of the union. The UK is a family of nations that share social, cultural and economic ties that together make us far safer, more secure and more prosperous. As we have seen throughout the Covid crisis, it is the economic strength of the union and our commitment to the sharing and pooling of resources that has supported jobs and businesses throughout Scotland. It is the strength of our union that will enable us to rebuild our economy following this crisis.
Why are the Government, composed of members of the Conservative and Unionist Party, with a self-proclaimed Minister for the Union at its head, not making the case for the union with vigour and conviction as a possibly landmark Scottish election approaches? What are the specific recommendations in the as yet unpublished Dunlop report on the union, which are now apparently being implemented, as I was told in a Written Answer given on 5 October? How will they help strengthen our great but seriously imperilled union?
The message behind my noble friend’s Question is that we must do more to ensure that Scottish people see and understand the benefits of being part of one of the most successful partnerships of nations. The Prime Minister has created the Cabinet Committee on Union Policy Implementation, which will drive forward the message that Scotland benefits directly from the UK shared prosperity fund, for example. I am grateful to my noble friend Lord Dunlop, many of whose recommendations we are implementing. The Government have committed to publishing the review in due course, and before the end of the year, we hope alongside the successful conclusion of our joint review of intergovernmental relations.
Does the Minister agree with Douglas Ross, Leader of the Scottish Conservatives, that
“we need to deliver formal representation for our nations and regions”
in a reformed House of Lords? Does he think that such a step would help to strengthen relationships within the United Kingdom?
I will not be drawn into commenting on that, but I will use this opportunity to say that we strongly believe that Scotland should remain, and is better off remaining, within the UK. So much comes from south of the border, such as delivering growth deals at a cost of £1.5 billion to every part of Scotland, preparing trade deals across the world, establishing at least one free port in Scotland, improving transport links and holding COP 26.
My Lords, elections to the Scottish Parliament will indeed take place in six months’ time. Can the Minister confirm that if a majority of Members of that Parliament are elected on a manifesto committed to holding a referendum on independence, the UK Government will respect that mandate and work with Scotland’s Government to facilitate such a referendum within a reasonable timescale?
The noble Lord will not be surprised when I say that Scotland had an independence referendum in 2014 which was legal, fair and decisive. The people of Scotland voted by a significant margin to remain part of the UK, and we are committed to respecting and upholding that result. The noble Lord will know that the Prime Minister wrote to the First Minister of Scotland in January confirming that he cannot agree to any request for a further one.
My Lords, it is difficult to keep a marriage together when one party wants a complete separation. I must say to the Minister that rough wooing will not win her ladyship back. Does he agree that some in Whitehall still do not get that Britain is not England? Can he ensure that this message is sent round the departments? Can he also tell us how he will get the Government to explain their policies better? For instance, the furlough scheme seems to have been invented in Holyrood as far as the Scots are concerned, not in London, and is not funded by the English taxpayer.
I will certainly take back my noble friend’s first point. The furlough scheme, including the self-employment income support scheme, has supported the jobs of more than 930,000 people, so we can see how the Scots benefit. But the Prime Minister has said that if other parts of the UK need to go into measures that require the furlough scheme, it will be available to them not only now but in the future. However, it has been made clear that this would be a decision for the Chancellor, liaising with the Prime Minister.
My Lords, when we think of the relationships between the various nations of the United Kingdom, we realise that there are advantages to belonging to the United Kingdom, as well as the benefits of remaining with our own identities. I cherish my Welsh identity, but I also see advantages in our four nations working together. Would a federal solution not be the way forward, and in any ballot to have not simply “in” or “out” but three options: to stay as we are, with Scotland staying as it is; to leave 100%; or to build a federal United Kingdom?
The noble Lord leads me nicely into saying that there we are looking at two reviews: the Dunlop review, which I mentioned earlier, and the intergovernmental review. The noble Lord will be aware that there is a balance to be struck between devolving powers to the nations and having Great Britain—or England—supporting the nations too. The successful devolution of powers to legislatures and Ministers in Scotland, Wales and Northern Ireland has taken place gradually over the last 20 years, with the Scotland Act and the Wales Act. Now is the time to review that, which is what we are doing.
My Lords, in its 2016 report, The Union and Devolution, the Constitution Committee stressed that the four nations of the United Kingdom are stronger together than apart, and reiterated what it said in 2014: that the Government must
“devise and articulate a coherent vision for the shape and structure of the United Kingdom, without which there cannot be constitutional stability.”
The Minister has just stressed the benefits of the union to all parts of the United Kingdom, but what is the Government’s coherent vision for the shape and structure of the United Kingdom?
Notwithstanding the reviews that I have mentioned, one of the key policies that has been rolled out is the presence of the new Queen Elizabeth House in Edinburgh. This opened in September and is a powerful example of the UK’s wanting to show greater commitment to Scotland by liaising more closely with the Scottish Government, local authorities and communities. We want to emphasise once again that Scotland clearly is stronger as part of the UK.
My Lords, there is a clear surge in Scottish opinion supporting independence. The single factor identified behind this surge is the unpopularity of the Prime Minister. How do Her Majesty’s Government propose to remedy this danger to the union?
The measures that I have set out regarding what we are doing to help Scotland need to be put forward more clearly. The essence of my message today is that, from the unit in No. 10, we need to work harder on our communications, explaining and ensuring that the Scottish people understand what we are doing for them in all kinds of respects, from big infrastructure projects to new transport links.
My Lords, the existing constitutional arrangements throughout the UK, including in England, are increasingly unstable and unsustainable. A major cause is the economic, social and political dominance of London and south-east England and the London-based elites in all areas. Would the Government not be better setting up, in co-operation with other political parties, a constitutional convention covering all parts of the United Kingdom, including the regions of England?
Let us see what comes out of the reviews that I have mentioned. The noble Lord will be aware that on 1 January 2021, we will see the single biggest transfer of powers to the devolved Administrations in history, as the EU structures fall away and new powers transfer to the Administrations in Scotland, Northern Ireland and Wales. It comes back to this balance, and the importance of ensuring that the nations know that they are better off together.
We want to engage with the devolved Administrations on the UK internal market in order to manage the potential for market divergence and deliver a shared solution. We have a well-established government structure with the devolved Administrations to ensure collaboration on these policy issues, including the Joint Ministerial Committees and bilateral agreements.
Planning: Accessible Homes
My Lords, the Government place great importance on the provision of suitable homes for people with disabilities. This is why we are currently consulting on making higher accessibility standards mandatory in reviewing the provisions for accessible and adaptable housing within building regulations. Our consultation has proposals to see more homes delivered, and authorities still need to plan for the housing needs of different groups within their communities, including the needs of people with disabilities.
My Lords, housing with care, sometimes described as assisted living or extra-care housing, provides a vital alternative to residential care for those older people who can no longer live on their own but do not need 24-hour complex medical supervision. It protects safety and security while boosting independence, health and well-being. Will the Minister say what the Government are doing to support housing-with-care developments in any new planning system?
My Lords, I support the proposal made by many groups representing those with a disability that Part M of the Building Regulations should be raised to what is known as the adaptable and acceptable standard, or M4, Category 2. This would enable more people to live healthy and independent lives without having to move. Further to what my noble friend just said about the consultation document, when will the results be published and when will its conclusions be implemented?
My Lords, the need for accessible housing is increasing and we urgently need homes that meet appropriate needs. Delaying provision of such housing and doing nothing is not an option. How quickly are the Government intending to implement the outcome of the consultation?
The Minister indicated that more homes were needed, as well as more accessible homes. We know that the viability test often puts the lid on accessibility being built into the equation by developers when they say that they cannot afford to provide these standards. Can the Minister assure the House that, in this consultation, the Government will not allow developers to hold them to ransom, as well as those in need of these higher levels of accessibility in their homes?
My Lords, the Government recognise the importance of accessible housing for the elderly and the disabled. I point to the strengthening of the policy approach in the NPPF in July 2018 and in the planning guidance issued in June 2019 on housing for the disabled. These point to the direction in which we are travelling to ensure that there is enough accessible housing. As your Lordships know, we have been looking at Part M of the Building Regulations as well.
My Lords, while my noble friend the Minister is looking at the consultation process, will he also look at the new ways of designing housing within an urban planning system? That really should be reflective of the 21st century. Covid has made us all realise that mental as well as physical well-being is essential, and intergenerational living is something that we should seriously consider. We should think about housing for the elderly or disabled not just as separate from us but rather as integrated with us.
My Lords, my noble friend is right: we are living longer and getting older. It is important that we have accessible housing for the elderly and learn from models across the country where there is both public and private housing. Proposals for accessible housing have to be relevant to older people, as she so rightly states.
My Lords, I draw the attention of the House to my relevant registered interests as a vice-president of the Local Government Association and as a trustee of the United St Saviour’s Charity in Southwark. As part of the modern almshouse that we are building, 11 of the 57 units will be for people with physical disabilities and fully wheelchair-accessible. This whole development has been the result of collaboration, with the developer delivering on its obligations to the community, Southwark Council providing the land and investment from United St Saviour’s to develop and manage the facility. What guarantees can the Minister give to the House to reassure us that this sort of development will be encouraged and supported in the new planning regime?
My Lords, we recognise the importance of the almshouses and that they are growing at their fastest rate in more than a decade. We are currently consulting widely on the proposals for reform set out in the planning White Paper and will listen carefully to all the representations made, including from those representing almshouses.
My Lords, it is excellent that the Government seem likely to be raising standards of accessibility for all new homes. When the volume housebuilders object that this will damage profits, will the Minister recall that when housebuilders made similar complaints last time around—when the standards were raised 30 years ago—extra costs actually proved minimal? Profits did not fall and hundreds of thousands of households have enjoyed better homes. This time, will the Government stand firm again?
My Lords, this Government will not seek anything other than an upward drift in the standards that we need for the 21st century. We recognise that developer profits are far greater than those of the construction industry, where they are typically about 4%; it is often up to a third for large-scale developments. The noble Lord, Lord Best, is therefore pointing in the right direction in respect of our ability to raise building standards.
My Lords, accessible homes need accessible transport. While it certainly makes sense to reduce health inequalities through promoting active transport, there will always be some people with disabilities who need to use cars door to door. We are not lazy or bad citizens: we are just trying to play a full part in society while managing our condition. A poorly executed and abrupt shift from car use to congestion charges, large pedestrian areas and public transport that is not yet disabled-accessible risks no-go areas for those with limited mobility. Will the Minister commit to smarter community design options that achieve public health aims without designing in exclusions or penalties for those with limited mobility?
My Lords, I thank my noble friend for pointing out a report which is just over a year old. With the Covid-19 pandemic, we are seeing a massive impact on our town centres and we need good policy to ensure that we have more inclusive and smarter options for urban design. Of course, we will look carefully at that report.
My Lords, following on from the question from the noble Lord, Lord Best, does the Minister agree that changing the regulations for homes to be built to accessible and adaptable standards should not mean that fewer homes will be built, as the additional costs per typical dwelling are very small?
My Lords, I made clear in response to the noble Lord, Lord Best, that we can raise standards while continuing the drive for the numbers of homes, of all types and tenures, that this country so badly needs. However, we have to wait to have time to respond to the ongoing consultation.
My Lords, with regions such as the north-west, the north-east and Yorkshire hosting less than one disabled-access home for every 100 homes, and regions such as the West Midlands hosting just over one disabled-access home for every 300 homes, given that 15.2% of the population is elderly and 18% of the population is disabled, is it now time that the Government mandated targets for disabled-access homes rather than simply relying on local authorities?
My Lords, I am afraid I am the wrong person to answer that. I spent 20 years in local government and have every confidence that local councils know the needs of their communities, and can respond to them in a way that ensures we see the drive for standards and improved accessibility needed in our homes.
Covid-19: Contracts and Mass Testing Programme
To ask Her Majesty's Government how many contracts they have placed for the purchase of (1) personal protective equipment, and (2) the mass Covid-19 testing programme, (a) with suppliers identified as “VIPs”, and (b) using fast-track procurement procedures since 1 March; what is the total value of any such contracts; and what steps they are taking to demonstrate that such contracts (a) represented value for money, and (b) involved no favouritism.
My Lords, 289 contracts with an estimated value of £6.1 billion have been awarded by the DHSC to private sector suppliers to support test and trace, and 370 contracts worth an estimated £8.3 billion for the delivery of PPE. These figures are currently being validated with the National Audit Office. A direct award of a contract—an option available under the procurement regulations in cases of extreme urgency—has been used in the great majority of these cases. I reassure noble Lords that suppliers are evaluated by departmental officials and awarded contracts in line with the DHSC’s standard contract terms and conditions.
My Lords, the noble Lord must realise that he is in danger of appearing complicit in the stench surrounding these procurements. On 6 April, he met with Meller Designs, which provides beauty products. It is owned by a man who was the finance chief of Michael Gove’s leadership campaign and a donor to the Conservative Party, while the noble Lord, Lord Feldman, who also sat in on that meeting, was chairman of the party. A few weeks later, the company was awarded a series of contracts amounting to £155 million for face masks and hand sanitisers. Those did not go through the normal procurement processes. What was discussed on 6 April? Will the Minister publish all documentation relating to every one of these VIP and fast-track procurements, including emails or messages suggesting specific contractors, and show how decisions were based on value for money rather than favouritism?
My Lords, the noble Lord will remember that at the beginning of this year the global supply of PPE, in particular, and other medical supplies completely collapsed. There was a global drought in the supply of key materials necessary for the protection of doctors, nurses and front-line healthcare staff. In those circumstances, we relied on a very large network of contacts and formal and informal arrangements in order, under extremely difficult circumstances, to reach the people who could manufacture these supplies, often moving their manufacturing from one product to another.
KPMG, PricewaterhouseCoopers, Deloitte and Ernst & Young have been fined for audit failures and have regularly been chastised by the regulator, even though they have been doing audits for over a century. They have no experience of test and trace or of dealing with viruses but have received multimillion-pound Covid contracts. What due diligence checks were carried out by the Government and how? Will the Government inform Parliament and allow a public audit of all their checks on these firms?
My Lords, the circumstances of the pandemic were exceptional, and I am not sure that any large company had any experience of putting together a national test and trace programme. The firms to which the noble Lord refers have considerable consulting experience and the capacity to support the national rollout of a large organisation such as NHS Test and Trace. They have provided invaluable support to the country at a time of need. All our contracts are scrutinised extremely closely by the finance function in the DHSC, and we are supported in that by the government legal service and finance staff from the MoD and the Cabinet Office, for which we are enormously grateful.
My Lords, in July, a company called Topham Guerin was given a £3 million contract, without any tender process, to test public understanding of health messages relating to Covid. It did not have any experience in health messaging; those running the company appeared to be friends of Dominic Cummings and Michael Gove. Will the Government now publish the tender that has subsequently been issued, the research findings and the evaluation relating to this contract? As the country goes into lockdown, it is fair that taxpayers know whether we are paying money for old rope.
My Lords, the insight into how the public react to key messages associated with our healthcare and health advice has been absolutely critical. Behavioural change and asking the public to step up to extremely challenging requests from the Government require a huge amount of analysis and study. The support from our own communications team has been supplemented by agency support, which has both the capacity and the expertise to provide the necessary insight. That insight has been critical to the success of our messaging.
My Lords, there is little doubt that one of the main reasons we are re-entering lockdown this week is the failure of Serco’s track and trace system, which the Prime Minister promised would be world beating. I do not want to go into the detail of the connections between Serco and the party and key members of the Government. However, on a general level, can my noble friend justify renewing the Government’s contract with Serco when it has failed so badly, resulting in loss of life and livelihoods—a situation that SAGE has warned will decline further in the future?
My Lords, I do not accept the assumption that we are going into a second lockdown because of the failure of tracing. The tracing system has led to the isolation of more than 1 million individuals, which has done an enormous amount to break the chain of transmission. However, there is more that we could do. I completely acknowledge that the Government are focused on improving performance in tracing, and we will use the opportunity of the next month to ensure that that performance gets better.
My Lords, I declare my interests in medicine. Given that 55% of GPs, 35% of physicians and 11% of surgeons recently reported that they lack confidence in adequate PPE being available during the ongoing pandemic, when will the Government issue revised guidance to all NHS managers insisting on a duty of care to all front-line staff to ensure that staff are supplied with quality-certified appropriate PPE that is in date and fit tested under a risk assessment for the well-being of the clinical workforce? Have the Government commissioned research into reusable UK-manufactured PPE?
My Lords, we take the duty of care to our staff and patients extremely seriously, and that is already well documented by the NHS. I reassure the noble Baroness that purchase orders have been raised for 32 billion items of PPE in anticipation of a second wave; 18.6 billion items have already been delivered, 2.2 billion are with our delivery partners, and a further 16 billion are on their way. This is a massive investment in PPE and I reassure her that it will be made available to healthcare staff in abundance.
My Lords, it seems to me that, however urgent the requirement for PPE and other services, transparency becomes even more important in those circumstances. The Minister will be fully aware that the Ministerial Code says that Ministers are responsible for ensuring that no conflict exists, or appears to exist, between their personal interests and their public duty. As the former chair of a procurement committee for MyCCG, I received extensive NHS training on conflicts of interest, which are defined as
“a set of circumstances by which a reasonable person would consider that an individual’s ability to apply judgement or act, in the context of delivering, commissioning, or assuring taxpayer funded health and care services is, or could be, impaired or influenced by another interest they hold.”
Perception is as important as reality. Has the noble Lord declared the interests that arise out of the meetings that other noble Lords have mentioned today? Where are they recorded and published?
The noble Baroness is right that transparency is key. I take those principles extremely seriously, and that is why we are publishing the contracts. I encourage anyone who is interested in looking at them to look at my Twitter feed, where I published a link to the Contracts Finder service yesterday. I reassure her that, although some connections were made through networks, absolutely every contract had exactly the same technical assurance, exactly the same contract negotiation and exactly the same procurement scrutiny. Those were done by civil servants, and value for money for the taxpayer and the people was guaranteed by that process.
My Lords, the Minister seems to say that there is nothing to see here, whereas some of us think that there is a whiff of uncertainty and of some things being not quite right. Therefore, will he agree to appoint an independent forensic auditor to carry out an independent report that can be published publicly to show exactly what has happened with PPE procurement?
My Lords, I do not want to give the impression that absolutely everything is perfect. Those were desperate days and we had to do extraordinary things to protect our healthcare staff. I remind noble Lords that other countries were flying in their representatives with bags of cash on private jets in order to seal contracts and some of our supplies were literally taken from under our noses on the runway at Hong Kong airport. They were extremely difficult times and I do not pretend for a moment that everything was absolutely perfect, but I reassure noble Lords that the right procedures were put in place by officials, and I reassure the noble Lord that these figures are currently being validated with the National Audit Office.
Covid-19 Lockdown: Economic Support
Commons Urgent Question
The following Answer to an Urgent Question was given in the House of Commons on Tuesday 3 November.
“Yesterday, the Prime Minister set out why we are introducing new measures to tackle coronavirus. This decision is not one we would wish to take, but it responds to the soaring infection rate.
Just as we have a responsibility to protect lives, we must also safeguard livelihoods. That is why the Government have provided unprecedented levels of financial support throughout this crisis, in a package described by the International Monetary Fund as
‘one of the best examples of co-ordinated action globally’.
This package includes an extension to the Coronavirus Job Retention Scheme, where employees will receive 80% of their usual salary up to a maximum of £2,500, while employers need only pay national insurance and pension contributions. We will provide more support to the self-employed. We are increasing the Self-employment Income Support Scheme grant from 40% to 80% in November. This boosts the total grant from 40% to 55% of trading profits from November to January, up to a total of £5,160, aligning it with the furlough scheme. In addition, home owners hit by the pandemic can continue to claim a six-month mortgage holiday, and businesses that are required to close can receive non-repayable grants worth up to £3,000 a month. In total, these grants are worth over £1 billion a month.
We are also planning to extend the existing business loan schemes and the future fund to the end of January, as well as making it possible to top up bounce-back loans. Local authorities will also receive £1.1 billion to support businesses more broadly, and up to £500 million to support the local public health message through the contain outbreak management fund. We will also uplift the Barnett guarantee this week to give Scotland, Wales and Northern Ireland further certainty over their up-front funding.
These measures build on the Government’s economic package that now totals over £200 billion. They will provide security to millions of people while giving businesses the flexibility to adapt and plan, and they underline our unrelenting focus on listening and responding to the damaging path of this virus.”
My Lords, the announcement that the Self-employment Income Support Scheme grant will increase to 80% for November is welcome. However, the Chancellor still has not moved on the issue of the thousands who are not eligible for payments. When will the Government act to ensure that the scheme provides wider and fairer coverage, rather than awarding a 55% grant to some and nothing to others? In addition, can the Minister confirm whether the test and trace support payment will be extended to those who receive a notification via the NHS app? Will the size of the payment remain the same even if the Government reduce the self-isolation period to seven days, as has been reported in recent days?
My Lords, we are very aware of the pressure on self-employed people at the moment, and it is important to remind the House of the level of support that we have given. Up to 19 July, there were 2.7 million claims for SEISS, totalling £7.8 billion. On the second grant, up to 22 October, we had 2.3 million claims of up to £5.9 billion. We keep under review the whole issue of trying to protect those who have fallen through the cracks. As the noble Lord will know, in relation to the universal credit system, yesterday we announced that the removal of the minimum income floor has been put back until April, which will help. In relation to his very specific questions about linking the isolation payments to NHS Test and Trace, I will have to write to him, which I will do as soon as possible.
My Lords, the Minister did not answer the question on the 3 million people excluded, who are largely self-employed and just seemed too complicated to deal with last spring but surely could be provided for now? Will he specifically address that? Businesses are under extreme pressure: they are being asked to cope with constant stopping, starting and change in support schemes. Will the Minister now commit to extend 80% furlough and related schemes until the end of June, when we expect a vaccine, so that any business that will be viable, if it can survive the pandemic, can cope with the short-term constraints and closures?
As the noble Baroness will know, we have no certainty about when a vaccine will be available in quantity. She mentioned June next year, which is a possibility; it might be sooner or later. That is why we are not able to make long-term commitments. I tried to answer the questions that the noble Lord, Lord Tunnicliffe, asked about support for the self-employed and mentioned various mechanisms. She will know that, if they are businesses that have their own premises, we are providing support at £3,000 a month to go towards fixed costs like rates and running costs.
My Lords, my noble friend the Minister will know that I have written to him about a local business that I am sure is not alone in that, since the beginning of lockdown, its business, which is in exhibitions, has shrunk by 90%. It does not see any business coming back until autumn next year. It has taken out loans, made redundancies and done everything sensible, but the business rates keep having to be paid month on month on month, and that is getting extremely hard for it. What can the Government do to help businesses in that sort of circumstance?
I share my noble friend’s concern about small businesses: it is absolutely ghastly for all these people. I want to explain to him that all eligible businesses in retail, hospitality and leisure will pay no business rates in England for 12 months from 1 April 2020 until March next year. This support is worth almost £10 billion to business, and an estimated 735,000 retail, hospitality and leisure properties will be included in this over that period. There is no rateable value threshold on the support; businesses large and small can benefit. In addition to the business rates holiday, the Government have announced further measures in response to the second lockdown: as I mentioned to the noble Baroness a moment ago, cash grants of up to £3,000 a month, and the extension of the Coronavirus Job Retention Scheme until 2 December.
My Lords, there has been a particular problem in the rental market, whereby renters and landlords have suffered as a result of these latest measures. Given the temporary protection from eviction for those living in tier 2 and 3 areas, could the Government confirm whether an eviction ban will now be extended across the country and whether they will now develop a strategy to help tackle arrears brought on by Covid to avoid a tragic spike in homelessness?
My Lords, we will keep all these issues under review. As the right reverend Prelate will probably be aware, we have extended payment holidays on mortgages and certain consumer credit products to take pressure off individuals. In relation to his rental suggestions, we will keep them under review and will keep the House notified.
My Lords, yesterday in the Commons, the Chief Secretary to the Treasury responded to repeated questions from all sides of the House about whether the furlough scheme would continue at 80% in Scotland and Wales after 2 December if there was a continued lockdown. He said:
“the Government will always be there to provide support to all parts of the United Kingdom.”—[Official Report, Commons, 3/11/20; col. 166.]
We know that the Government will always be there, but will they provide support at 80% if the lockdown continues beyond 2 December? Will they provide that support not just in Scotland and Wales but in the north of England if the lockdown continues as it is at the moment?
My Lords, as I am sure the noble Lord knows, we have provided some £14 billion of funding to the devolved authorities. That is important because £1.3 billion was announced on 9 October. It is there to support businesses: in Scotland, for example, we have been able to support nearly 1 million jobs, some 6,500 businesses and 240,000 people in employment. I am aware of no proposal to change the 80% furlough either in England or in Scotland.
My Lords, I welcome the economic support being provided by the Government, which is unprecedented in our peacetime history. Despite that, is it not the case that, as we approach Christmas, very many individuals and businesses face an uncertain future, particularly in retail, hospitality and leisure? Therefore, does my noble friend agree that, for the economic health and well-being of our entire nation, it is vital that the second lockdown does not extend a moment beyond 2 December?
I absolutely agree that it is a top priority that we do not stay in lockdown for a day longer than we have to. It was done with great reluctance because of the very rapid expansion of the virus across parts of England, which had not seen it accelerating at the pace that it has in the last week or so. Nobody wins from a lockdown, but we are also very aware of the pressure on health services and need to ensure that the NHS is able to cope with the surge that is inevitably coming at us, as we know from the data we have now. This is one of the advantages that we have over the first lockdown: we see this tsunami of infections approaching a little further ahead than we did six or nine months ago. Therefore, we are trying to react to that, but I absolutely agree that we do not want to stay in lockdown for a moment longer than we have to.
My Lords, when the Government put England into a new lockdown, it was announced that the furlough scheme would be extended for England. When the Prime Minister was challenged whether this would likewise be the case for Scotland, he said of course it would, so why did the UK Government refuse the Welsh Government’s original request that furlough be available for businesses in Wales at those times when Wales is in lockdown, thereby ignoring the pressing needs of business in Wales and causing unnecessary uncertainty?
As the noble Lord will be aware, we have made very substantial payments to the devolved authorities over the last few months and increased those payments in October by £1.3 billion. We are all in this together, as my right honourable friend the Chief Secretary said yesterday. We keep all these situations under continual review.
My Lords, some firms are facing considerable difficulties in obtaining CBILS loans; I speak as chairman of the Cumbria Local Enterprise Partnership. This appears to be because some banks are reorganising their own internal arrangements in response to the crisis, while some are reluctant to deal with businesses that are not regular customers. What are the Government doing to ensure that these problems will be resolved and that the CBILS arrangements work as intended before the potential borrowers’ money runs out?
My Lords, my honourable friend the Economic Secretary is in constant dialogue with the banks on how all these schemes operate; he continues to try to help to improve them. If the noble Lord would like to write to me on the specific concern he mentioned, I will ensure that it gets the proper attention.
My Lords, the time allowed for this Question has elapsed. I apologise to the noble Baronesses, Lady Redfern and Lady Uddin, who were not able to put their questions.
Commons Urgent Question
The following Answer to an Urgent Question was given in the House of Commons on Tuesday 3 November.
“I am grateful to the honourable Member for Hampstead and Kilburn (Tulip Siddiq) for raising this question. We are deeply concerned that Iran has issued new charges against Nazanin Zaghari-Ratcliffe. This is indefensible and unacceptable. We are relieved that the groundless new trial, which commenced on 2 November, was adjourned and that Mrs Zaghari-Ratcliffe remains on furlough, but we will continue to call on Iran to make Mrs Zaghari-Ratcliffe’s release permanent.
On 29 October, we summoned the Iranian ambassador to make clear our deep concerns about these new charges. We fully support the family’s request for officials from the embassy in Tehran to attend any court hearings. The UK Government issued a note of avowal formally requesting UK Government attendance at Mrs Zaghari-Ratcliffe’s recent 2 November hearing. So far, regrettably, we have not been granted access to Iranian judicial hearings of any of our dual British national detainees. We will continue to firmly lobby for access to them.
On 22 September, we summoned the Iranian ambassador and handed over a letter from E3 Foreign Ministers about the human rights situation in Iran, including our shared concern about the arbitrary detention of dual nationals. The ambassador in Tehran will continue to raise this with his Iranian counterpart. The Foreign Secretary has spoken directly to Foreign Minister Zarif three times since the summer and continues to raise the situation of Nazanin Zaghari-Ratcliffe and the other UK dual nationals in the strongest terms.
Since the Foreign Secretary was last at the Dispatch Box both he and Foreign, Commonwealth and Development Office officials have been in regular contact with Mrs Zaghari-Ratcliffe and her family. The Foreign Secretary has spoken with both Mrs Zaghari-Ratcliffe and her husband, when he reiterated that the UK Government, from the Prime Minister down, remain committed to doing everything we can for her.
The UK Government continue to engage with international partners and directly with the Government of Iran on the full range of issues of interest to the UK. Our priority remains to prevent Iran from acquiring nuclear weapons capability, to promote stability and security in the region, to secure the release of all our dual national detainees, and to keep the diplomatic door open for a new talks with Iran.
Alongside our E3 partners, we are committed to the nuclear deal with Iran—the joint comprehensive plan of action, or JCPOA—as the best means available to monitor and constrain Iran’s nuclear programme. As we have said before, we are deeply concerned by Iranian non-compliance. Iran must engage with the dispute resolution mechanism, which we triggered with France and Germany on 14 January, and return to compliance. We also continue to have serious concerns regarding the implications for the security of the region with the expiry date of the United Nations conventional arms embargo on 18 October.
I can assure the House that the safety and good treatment of all dual national British detainees in Iran remains a top priority of the UK Government. We will continue to lobby at all levels for their permanent release on humanitarian grounds so that they can return home safely to their loved ones.”
My Lords, I welcome this Statement and the Foreign Secretary’s representations about Nazanin’s case generally, including his rightly voiced opposition to her potential return to prison during a second trial. Yesterday, James Cleverly welcomed the fact that she had not been sent back to prison. However, can the Minister confirm whether the Government have made specific representations to Iran on this possibility? Can he also detail any further multilateral action at the UN to secure her release and that of other British dual nationals incarcerated in Iran?
My Lords, I thank the noble Lord for his support. I know that this issue has cross-party support and we are working together on this aim. On his final point, yes, we are working with partners to apply maximum pressure for all dual nationals arbitrarily detained in Iran to be released. On this specific case, we have made specific representations, both through the interactions of my right honourable friend the Foreign Secretary and at ambassadorial level.
My Lords, the cases of the dual nationals being held in Iran are clearly appalling. Following the question asked by the noble Lord, Lord Collins, I would like to probe the Minister on whether the Government carried out a risk assessment of the safety of Nazanin and others due to the postponement of the IMS debt. We have not had an answer to that either in the Commons or here. Exactly when did the Government ask to attend her trial and what answer did the Iranian authorities give?
My Lords, on the noble Baroness’s second point, as she will be aware, the Iranians do not recognise Nazanin’s dual national status. We made that representation; it was declined. On the IMS dispute, I assure the noble Baroness that discussions are ongoing to explore further options to resolve this 40 year-old case, but it would be inappropriate for me to comment further on the case at this time because of those ongoing discussions.
My Lords, the shocking treatment of Nazanin Zaghari-Ratcliffe throws into sharp relief the appalling human rights track record of Iran, does it not? Will the Minister therefore talk specifically about the recent executions of some of the 2019 protesters and the despicable intimidation of members of staff at the BBC Persian service and their families?
My Lords, I join the noble Lord in recognising that the UK has a long-standing opposition to the death penalty, whatever the reason and in whichever country. We continue to make that case to Iran and other nations. Iran’s criminalisation of co-operation with the British Council and the attacks against BBC Persian employees are also deeply concerning. The Government continue to provide support to defend them repeatedly at the highest levels in Iran.
In the Statement, the Minister in the other place said that
“we are committed to the nuclear deal with Iran—the joint comprehensive plan of action, or JCPOA—as the best means available to monitor and constrain Iran’s nuclear programme.”—[Official Report, Commons, 3/11/20; col. 185.]
The Foreign Secretary suggested on television this morning that there are flaws but until something else is out there, it is the only option. What work has the FCDO undertaken to create an alternative? It has also been suggested that the Iranian Islamic Revolutionary Guard Corps has shamelessly harassed Mrs Zaghari-Ratcliffe. To save my noble friend the Minister from telling us that he cannot discuss future proscriptions, I ask this: given that the Minister in the other place was clear on the concerns about Iran’s destabilising activities throughout the region, can my noble friend tell the House what possible further destabilising activities the regime and the IRGC can get up to before we act in a tough and appropriate manner?
My Lord, on my noble friend’s second point, we are acting in conjunction with our E3 allies to ensure that the JCPOA remains alive and on the table. It prevents Iran becoming a nuclear state, which must be a priority.
My noble friend raises concerns about the IRGC. We share them, particularly regarding Nazanin Zaghari-Ratcliffe’s case and the challenge that she has been presented with the IRGC. On the efforts that we are making, we continue to work with our US allies and E3 partners to ensure that the current ban that was lifted on arm sales to Iran can also reach a conclusion that satisfies our allies across Europe and in the US.
My Lords, in April 2019, the Government granted diplomatic protection status to Mrs Zaghari-Ratcliffe—a very welcome signal that the UK treats the case no longer as a consular matter but as a formal legal dispute between Britain and Iran. Has that change of status been reflected in any change in the Government’s approach to this matter? What difference has it made, if any?
My Lords, exercising diplomatic protection to Mrs Zaghari-Ratcliffe’s case formally raised it to the level of a state issue. We continue to take further action where we judge that it will help to secure her full and permanent release. For the time being, we welcome the fact that she has been allowed to return home and has not been taken to prison.
My Lords, following on from my noble colleagues’ questions, can the Minister assure us that Nazanin Zaghari-Ratcliffe will be able to have medical check-ups through the embassy every week and that a permanent person will visit her every other day from the embassy? At the moment, I feel she is in a very fragile state, with no continuity of people to be with her besides her family.
My Lords, what is holding back a resolution? The issue must be more complex than we understand it to be. Is practical horse-trading really going on behind the scenes? For example, have the Supreme Leader’s personal representatives, who are based in London and directly responsible to him, been sat with? If so, with what outcome? What price freedom? Is Iran holding out on its internal judicial process by saying no to the return of the £400 million-plus owed by the Government rather than having the UK turn this into an advantageous negotiation position that could also be put to the benefit of the desperate lot of Iran’s long-suffering people, having been instructed to do so by a UK court? Where is the best practice in the UK’s rule of law in all this?
I agree with the noble Viscount that our argument and challenge are not with the Iranian people; they have suffered for far too long. We are engaging on this issue at the highest level. From the Prime Minister downwards, we are engaged in getting Nazanin Zaghari-Ratcliffe, and other dual nationals who are arbitrarily detained, released on a permanent basis.
My Lords, it seems clear that the Iranian regime is using the court process as a negotiating tactic. This does not affect dual nationals just from the United Kingdom but also from France, Germany, Australia and the United States. We can probably anticipate that some of these practices will be accelerating ahead of the presidential elections in Iran in June. Have we had discussions with our partners to protect dual nationals across the board and to take joint action?
I welcome the noble Baroness to the House and assure her that we work very closely in conjunction with our partners, including those who have detainees who are arbitrarily detained. On the future elections, it should be in our mind that Ayatollah Khamenei, as spiritual leader, also has ultimate adjudication powers on any decision taken by the Iranian Government.
My Lords, is there any truth in the allegation that some other countries—Australia, France, Germany, Canada and the USA—have had greater success in getting their people back? Is this only because their people were not dual nationals? Secondly, have the Iranians ever mentioned the money in the course of our negotiations with them about Nazanin’s release?
My Lords, I have already commented on the ongoing discussions that we are having on the issue of the debt. On the noble Lord’s first point, I believe that he answered his own question. He is quite right that those detainees have been successfully released because they hold a particular nationality. Regrettably, Iran does not recognise dual nationals and that has been its persistent response to our lobbying on this case and others.
My Lords, all supplementary questions have now been asked.
United Kingdom Internal Market Bill
Committee (4th Day)
Relevant documents: 14th Report from the EU Select Committee, 24th and 26th Reports from the Delegated Powers Committee, 17th Report from the Constitution Committee and 8th Report from the Joint Committee on Human Rights
My Lords, hybrid proceedings will now resume. Some Members are here in the Chamber respecting social distancing, others are participating remotely, but all Members will be treated equally. If the capacity of the Chamber is exceeded, I will immediately adjourn the House.
I will call Members to speak in the order listed in the annexe to today’s list. Members are not permitted to intervene spontaneously. The Chair calls each speaker. Interventions during speeches or “before the noble Lord sits down” are not permitted.
During the debate on each group I invite Members, including Members in the Chamber, to email the clerk if they wish to speak after the Minister. I will call Members to speak in order of request and will call the Minister to reply each time. The groupings are binding and it will not be possible to degroup an amendment for separate debate. A Member intending to press an amendment already debated to a Division should have given notice in the debate. Leave should be given to withdraw amendments. When putting the question, I will collect voices in the Chamber only. If a Member taking part remotely intends to trigger a Division, they should make this clear when speaking on the group. We will now begin.
We now come to the group beginning with Amendment 149. Anyone wishing to press this, or anything else in this group, to a Division should make that clear in the debate.
Clause 38: Information-gathering powers
149: Clause 38, page 29, line 36, after “evidence” insert “or is subject to legal professional privilege”
Member’s explanatory statement
This amendment makes explicit reference to legal professional privilege in Clause 38(8).
My Lords, I will speak to Amendment 149. It will not surprise the House to learn that I am very grateful to the Law Society of Scotland for its help in briefing me and preparing this amendment. I state once again for the record, as on the register, that I am a non-practising member of the Faculty of Advocates, so have had cause in the past to be deeply grateful to solicitors in Scotland.
Amendment 149 amends Clause 38, which relates to information-gathering powers, setting out the powers the CMA will have to gather information in support of its functions in this part; under subsections (2) and (3), it will be able to provide an information notice or require the production of a document by an individual business or public authority. The notice must describe the type of information required and when and how it is expected to be relayed. Under subsection (6), the notice must make clear which precise function of the CMA is relevant, as well as the legal and financial consequences of non-compliance. Subsection (8) sets out that no information can be requested if it could not be compelled to be given in the course of civil judicial proceedings before the court, and that a notice may not require a person to go more than 10 miles from their residence without having their travelling expenses paid or offered to them.
This begs a question, which has been identified. Through this amendment, I would make explicit reference to “legal professional privilege” in Clause 38(8), for the very simple reason that a person should not be compelled, as I just stated, under subsection (8),
“to produce or provide any document or information which the person could not be compelled to produce, or give in evidence, in civil proceedings before the court”.
This provision may apply to legal representatives, but that should be made clear by a reference to “legal professional privilege” in the clause. My direct question to the Minister is this: why is it specifically not referred to? I am sure he will say that it is implicitly relied on, but I pray in aid that legal professional privilege is the client’s privilege, not the lawyer’s privilege. It is an essential aspect of the rule of law which enables clients to consult freely with their lawyers and is widely recognised in statute. I would like it in this Bill, unless I hear extremely good reasons from my noble friend why it is not already there. I beg to move.
My Lords, I have two amendments in this group. I also support the amendment just explained by the noble Baroness, Lady McIntosh.
This group concerns the information-gathering powers in Clause 38; it applies to Clause 31, under which requests for a report from the CMA may be made by anyone, and to Clauses 32, 33 and 34, under which administrations may request, respectively, advice on proposed regulatory provisions, reporting on the impact of a regulatory provision and reporting on a regulatory provision that is or may be detrimental to the market.
To prepare reports, information needs to be gathered. The powers enable the CMA to ask any person for any document in their possession or to require any person who carries on a business to provide estimates, forecasts, returns or other information as may be specified. As the noble Baroness, Lady McIntosh, has already highlighted, it can further specify the time and place at which, and the form and manner in which, the information is to be provided. It may also require conversion of a non-legible record into a legible and intelligible copy of information. There is no acknowledgment of how onerous this may be other than in subsection (8)(b), which says that travel expenses must be offered if a person has to go more than 10 miles from their place of residence. This could impose significant burdens on individuals or small businesses, to whom time is money.
It does not indicate that the information sought is only that which is readily available; it seems there is nothing to stop it requiring the preparation of estimates rather than, say, just the forwarding of those that might have been given to customers in the course of business. Many businesses may well be happy to assist in what is tantamount to a survey about the effects of regulation, just as many respond to consultations, but for small businesses it could be a burden. For sole traders it may mean a significant loss if income is dependent on work, whether that is as a plumber, lawyer, childminder, shopkeeper or anything else.
I am aware that the template of CMA market study investigations and Section 174 of the Enterprise Act have been followed, but are we truly looking at comparable circumstances? Market studies have more statutory requirements and guidance around them, such as the requirement of a market study notice and all the defined stages and practices. That does not seem to have been transposed into this. Nor are the circumstances those of known market deterioration caused by market participants—for example, it may just be about proposed or enacted regulation, with any flaws caused by administrations, which is completely different from when businesses, collectively or individually, have themselves created oligopolies, monopolies or concentrations.
In Amendment 150, I put forward that there should be provision for loss of earnings—why not, if the circumstance is that the expertise of the business is being sought? An alternative way to collect this kind of information is through consultations or by commissioning research. The CMA is empowered already under Section 5 of the Enterprise Act to commission such reports without resorting to enforced business responses. The members of the panel that will prepare the reports are being paid for their expertise, so why not those others who are being harvested for information?
My Amendment 156, would insert a new clause:
“The CMA must take account of the effects of additional duties imposed on small business in its approach to the exercise of its functions under sections 31 to 34, and its powers under sections 38, 39 and 40.”
This is not a strong amendment, but at least it makes the point, as otherwise there is no guidance. I am sure that MPs would interest themselves in the sorry stories they will be sent if there are burdensome requirements but, absent something like this, they have nothing to point to when overstepping has taken place. I will return to this matter in the context of penalties in the next group, but when there has been no wrongdoing that brings about the request for information—possibly burdensome requests, enforceable through fines rather than encouragement—it seems a wholly disproportionate measure. As I have said, I do not believe the cause is comparable with current CMA market studies.
Whither now the comply or explain principle—I have always been more of a “make them comply” person, as my track record will show, but these measures offend me in principle and seem to come from the department against business. I can see the matter is different if the business is under investigation for their own doings, but there is no distinction made in the clause. Clause 39 has a “without reasonable excuse” provision and I intend to probe that in the next group but, for now, can the Minister clarify the limits to the burden that can be put upon small businesses and the circumstances envisaged? Something of record has to be made.
As a final related point, there are also circumstances, of course, where much more has been opened up for challenges by businesses through Clause 31, giving the CMA reach into both administrative decisions and to other companies. My noble friend Lord Fox will say more on that.
My Lords, I will be very brief, as the noble Baronesses, Lady McIntosh and Lady Bowles, have explained this group extremely clearly. As the noble Baroness, Lady Bowles, said, these measures just offend me in principle. The Government seem, time and again, to understand big business, and are happy to give very large amounts of money and all sorts of leeway to such businesses and organisations but, at the same time, quite often miss the point on small businesses, which often struggle to survive—particularly during lockdown.
Small businesses can be the creative heart of our society at times—creating jobs for a lot of local people and, indeed, more widely. Will the Minister listen and understand that such intrusive and burdensome measures really do impact on small businesses that are already struggling to survive? I know it is very difficult for the Minister to commit to anything, but surely he is prepared to discuss this sort of issue with noble Lords and perhaps come to some sort of agreement.
My Lords, I was glad to see Amendment 149. It is always good to be clear about legal privilege to avoid needless or inappropriate fishing expeditions by regulatory staff, and it matters for in-house counsel as well as for external lawyers. It would be good to be clear on the Government’s intentions.
I also support the sentiment behind Amendments 150 and 156. We need to look after small business, the economic dynamism of which reflects a UK sector that was the envy of everyone when I was the Competitiveness Minister in Brussels. There is much in this Bill that they might fear: rules of which they are unaware; costs, as the noble Baroness, Lady Bowles, suggested, from burdensome requests; big fines; and quasi borders created between the different nations of the UK. I worked with the Federation of Small Businesses on regulation and getting them paid on time, and I try to promote a positive climate for the scale-up of small businesses, rather than a sale to a Silicon Valley, or other, giant after a short run of success. How will the Bill help small businesses, and are there dangers lurking here?
My Lords, I am very pleased to support these amendments, the first in the name of the noble Baroness, Lady McIntosh of Pickering, and the other two in the name of the noble Baroness, Lady Bowles. In relation to the amendment on legal privilege, I note that the Lords Constitution Committee report on the UK internal market Bill says:
“We welcome the confirmation by the Lord Chancellor that information protected by legal professional privilege will not be required to be disclosed to the Competition and Markets Authority under the information-gathering powers in clause 38.”
Can the Minister provide any further detail from the Lord Chancellor in relation to this particular issue? Can he say how and when the Government will bring amendments on Report dealing with this specific request to allow protection for clients in respect of the information-gathering powers?
In relation to the two amendments in the name of the noble Baroness, Lady Bowles, I would say that the last thing we need, particularly with Brexit hitting so many businesses and with the impact of Covid and the lockdown, are any more limits to business or on businesses. They have already suffered considerably, particularly the small businesses of sole traders or freelancers.
I think simply of the Northern Ireland situation, where the majority of businesses are small and, combined with the impact of Covid, many could close, resulting in loss of jobs and trading. There are some 148,300 small and medium-sized enterprises in Northern Ireland out of a total population of 1.8 million. This is the fewest of any UK region, as recorded in September of this year.
Another worrying factor is that research by Ulster Bank, a subsidiary of NatWest, shows that any hope of a V-shaped recovery in Northern Ireland has been snuffed out with Covid. I can understand and agree with the sentiments conveyed by the noble Baroness, Lady Bowles, that we do not want to see any further limits on businesses. In that regard, can the Minister advise noble Lords on what discussions he and his colleagues in BEIS have had with the devolved regions regarding these measures in the UK internal market Bill? Maybe he will surprise us and illustrate that there has been quite a bit of discussion.
My Lords, I support Amendments 150 and 156, and indeed broadly support Amendment 149. My noble friend Lady Bowles, in characterising the information-gathering powers that are attempted to be brought in through this Bill, ably described the wide, broad remit that is being given to the CMA. I fully support and share her case, which was well put, as to why we should be concerned about this.
This is not just a burden on small businesses. Like the noble Baroness, Lady Neville-Rolfe, I have experienced the sharp end of a market study. It is a lot of work. This Bill envisages more than that for all businesses. No such undertaking should be given lightly without understanding what it will do—particularly, as many speakers have said—for smaller and medium-sized businesses. There should be limits.
More broadly, as prefaced by my noble friend Lady Bowles, during the debate on Clause 31, my noble friends and others raised the potential for universities to be dragged into the ambit of the CMA and the OIM—not least because of the different tuition fee regimes that exist within our nations. As we all know, this is a devolved responsibility. Despite their efforts, Ministers did not satisfactorily explain how this would happen, including in the letter.
We now turn to Clause 38, which, once again, broadens the powers of the CMA and enables it to be involved in these matters. The powers which are envisioned, though extensive and with little or no restraint, further stoke the fears harboured by Scottish universities. It could work the other way around. It could be the English university fee policy that is being challenged. This power is wider, with very few limitations.
I wish to probe the potential role of the office for the internal market under Part 4 of the Bill in relation to tuition fees. According to Universities Scotland’s brief, the powers in the Bill could
“give the OIM/Competition and Markets Authority (CMA) the power to investigate and reach a view on whether differential student fees represent a distortion of the new UK internal market. Regardless of the non-binding nature of the reports and advice of the OIM/CMA, it would have to be taken seriously by Parliament (Holyrood or Westminster). This could introduce new and greater basis for individual challenges to the variable fee regime within the UK, brought by individuals who feel they are discriminated against. … If this understanding is correct, this would apply in both directions, with possible challenges brought by Scottish domiciled students/individuals who consider the fee policy as administered by universities in England to discriminate against their options.”
That is one example of the consequences of this Bill. Will the Minister tell your Lordships’ House whether it is intended or unintended? If it is intended, why do Her Majesty’s Government see fit to mess with this devolved responsibility? If it is unintended, can the Minister acknowledge the issues that pervade this Bill?
In the Minister’s letter to my noble friend Lord Purvis of Tweed, which I hope has been placed in the Library, the Government accept that there are issues about university services. It highlights the power to amend exclusions after the Bill is enacted. This should be clarified by a government amendment before Report, not afterwards.
There are many other examples. In the short time we have had to examine this Bill, we have uncovered anomalies, irregularities and mistakes not just in relation to universities but in the food, alcohol and energy sectors. The noble Baroness, Lady McIntosh, also raised queries about the legal profession. In the spirit of whack-a-mole, I can add more, such as the water industry. Powers under Clauses 31 and 38 could mean that the CMA could be asked by an investor in an English water service company to investigate, let us say, the mutual Welsh Water company. Water is to be considered as a UK market, where it was not before. Once a case is opened, who knows where it will end up? Is this accidental or deliberate?
At the same time as the Government accrue these badly-defined powers to the new OIM and CMA, corporate lawyers on behalf of big businesses headquartered in the UK and beyond are sharpening their pencils. As the Government seek to regulate on a UK-wide basis services that until now have managed very well without Her Majesty’s Government’s help, consumer lawyers are looking into their practice development strategies and preparing to sell litigation ideas to future clients. As the noble and learned Lord, Lord Falconer, put it, this will be “a lawyer’s paradise”. At its heart is the Government’s decision to sideline the flexibility of the common frameworks and pursue the central ambition of trying to create a rigid one-size-fits-all regulatory structure to deliver a one-size-fits-all United Kingdom. The persistent and obvious flaws in this Bill demonstrate that this one-size-fits-all approach is impossible, even if it were desirable, which it is not.
My Lords, this debate has raised some interesting and important issues. I have listened with care to all the speakers and particularly to the contribution of the noble Baroness, Lady McIntosh, based on information provided by the Scottish Law Commission, whose help I also acknowledge. I look forward to the Minister’s response. The noble Baroness, Lady Bowles of Berkhamsted, raised a number of issues to which I wish to return. Other speakers have made small but important points on SMEs and the role of Northern Ireland.
The noble Lord, Lord Fox, picked up on the recent letter from Ministers about university fees, particularly in Scotland, and questioned whether this could constitute indirect discrimination. This was also raised in an earlier group. Like the noble Lord, I wonder why this could not be better dealt with by the common frameworks approach. This should be applied to all aspects of managed divergence, in relation not just to goods but also to services and the regulation of professions. We will return to this on Report.
In respect of the amendments tabled by the noble Baroness, Lady Bowles of Berkhamsted, the powers included in Clauses 38,39 and 40 are quite extensive and detailed. Do they go beyond the existing powers of the CMA? Are they new because of the responsibilities that will accrue to the CMA or the office for the internal market under this Bill? Or do they simply repeat existing powers reframed in some way to suit the new circumstances? I would appreciate the Minister’s response. As other speakers have said, this additional activity is very detailed and gives specific examples of what can and cannot be done and how it is to operate. Does this not play to the concerns raised by the noble Baroness, Lady Noakes, in an earlier amendment that asking the CMA to extend its focus and the range of its work might blur the good work it does at the moment? Does the Minister accept that there might be a problem here?
My Lords, I thank all noble Lords who have taken part in this debate. The noble Lord, Lord Fox, raised issues around university tuition fees and water services. As he said, I have written to him and to the noble Lord, Lord Purvis, about the points they raised in earlier debates. I am told that these letters have been submitted to the Library but there may be a slight delay in their publication. I confirm what I said there about the exemption in the legislation for public services. More details are set out in the letters. If for some reason they have not yet been published, the noble Lords, Lord Fox and Lord Purvis, should get in touch with my office, which will be happy to furnish them with a copy.
Regarding Amendment 149, as previously noted, Clause 38 is based on the CMA’s existing powers under the Enterprise Act 2002. The clause has appropriate modifications to allow the CMA to gather information from businesses, individuals or public authorities. I can tell the noble Baroness, Lady McIntosh, and the noble Lord, Lord Fox, that this includes an existing exclusion for information that is subject to legal professional privilege from being required to be produced or provided to the CMA, whether that information is subject to legal advice privilege or litigation privilege. That confidentiality of communication between lawyers and their clients is protected by subsection (8) and therefore no amendment on the subject is needed.
Amendment 150 seeks to add new wording to the end of Clause 38(8). In reply to the noble Baroness, Lady Bowles, and the noble Lord, Lord Stevenson, I emphasise that the powers in question have to date functioned effectively for the Competition and Markets Authority and all its stakeholders without any need to provide further clarification as sought by this amendment. The Government remain confident that the CMA will continue to apply a flexible and pragmatic approach that will maintain the already high confidence of stakeholders in fulfilling its information-gathering power in Clause 38.
Amendment 156 would add a new clause to place a duty on the Competition and Markets Authority to consider impacts on small businesses when undertaking its functions in Part 4. I understand the concerns of the noble Baronesses, Lady Bowles and Lady Jones, and my noble friend Lady Neville-Rolfe. The Government are aware of the importance of recognising the impact on small businesses. However, the interests of small, medium and large businesses will be taken into account by the OIM in its monitoring and reporting functions, so there is no need to add a specific reference about the impact on small businesses. This is because Clause 32(4) sets out a function for the CMA to advise and report on a regulatory proposal prior to it being passed or made in law. The CMA will examine the potential economic impacts of the proposal on the functioning of the UK internal market. This could include a proposal’s impact on competition or trade distortions, indirect or cumulative economic effects or impacts on prices.
All these assessment criteria are highly relevant to and must cover impacts on small businesses. In order to serve all those with an interest in the internal market, the advice and reporting in question will of course account for the impacts on consumers, professionals and businesses of all sizes, in all sectors.
In the light of the reasons I have set out today, the Government do not consider that the amendments in the group are necessary. I hope that noble Lords will withdraw or not move them.
I have received a request to speak after the Minister from the noble Lord, Lord Fox.
I much appreciate the Minister’s answer. The questions I asked about university tuition fees were in the light of having read his letter, which my noble friend Lord Purvis made available to me—there is no need to send it to me. In it the Minister states that,
“we are aware of the questions raised in relation to university services and how they may interact with the Bill”,
which is good. The letter continues:
“We have the power to amend the exclusions Schedule and will keep the area of higher education under close review.”
It therefore seems that the Government are planning to do that after Report. My point is that it would be a boon to our process on the Bill if the Government were to consult before Report and come back with something that I am sure, given what the Minister said, would merely fulfil their ambition for the Bill while settling concerns in the university sector.
I thought that I had put the matter to rest by writing the letter to the noble Lord, Lord Purvis, on which the noble Lord, Lord Fox, has commented. In our view, there is no doubt that the regulation of tuition fees is outside the scope of the Bill and, therefore, beyond the scope of the office for the internal market’s functions. But as the letter to him confirmed, we will keep the matter under review and not hesitate to take action if there is a problem, which we do not believe exists.
The noble Lord, Lord Stevenson, and the noble Baroness, Lady Neville-Rolfe, also wish to speak after the Minister.
I asked the Minister a specific question on whether the framing of Clauses 38 to 40 was exactly the same, or differed from, the existing powers of the CMA. He did not answer that. I do not want to delay us too much today but perhaps he could write to me about it.
I have another couple of points for clarification by my noble friend. First, does legal privilege apply to in-house counsel, provided that they are properly qualified lawyers? I would be happy for the Minister to write to me about that. Secondly, he referred in the debate about small business to Clause 32(4), and helpfully explained that the CMA will advise on regulatory proposals before laws are made, which provides an opportunity for small business interests to be taken into account. However, my concern was also about enforcement of the law, which would bear particularly harshly on small businesses that do not have the same fancy legal departments as others. I am not sure that the clause deals with that but would be delighted if I was wrong.
On my noble friend’s first question, she will notice that Clause 38(8) states:
“A notice under subsection (2) or (3) may not require a person … to produce or provide any document or information which the person could not be compelled to produce, or give in evidence, in civil proceedings before the court”.
I hope that that resolves the matter. I will write to her on her second point.
I thank everyone who has contributed, including my noble friend the Minister in summing up the debate. We had an excellent discussion on the issues, and I am grateful to the noble Baroness, Lady Bowles, for raising them because they are pertinent. I am slightly confused as to why it is necessary to include in the Bill powers that already exist. We are told that they are not new, yet my noble friend will not agree to include in the Bill a matter that is already causing alarm.
I am grateful to the noble Baroness, Lady Ritchie, for alerting me to the Constitution Committee report in that regard. It has highlighted its concern and received a verbal undertaking from the Lord Chancellor. I should repeat that we are referring to the Law Society of Scotland, not the Scottish Law Commission. If both the committee of this House and the Law Society of Scotland are concerned, that verbal reassurance is not enough. I may well reflect on the matter and come back on Report. However, for the moment, I am grateful for having had the opportunity to debate this matter and I beg leave to withdraw the amendment.
Amendment 149 withdrawn.
Amendment 150 not moved.
We now come to the group beginning with the question that Clause 38 stand part of the Bill. I remind noble Lords that anyone wishing to speak after the Minister should email the clerk during the debate. Anyone wishing to press this question or anything else in the group to a Division should make that clear in the debate.
Debate on whether Clause 38 should stand part of the Bill.
My Lords, the previous group has already set the scene on Clause 38, where I propose some changes to help small businesses, at least. The point remains that the CMA, or OIM, is an opining body, often for the benefit of Administrations, even if most of those are not happy with how it is set up. I also clarify that I am not against the CMA per se. I have responded to its consultations, been quoted by it and would give it more powers in competition matters. Even if it were the chosen body, I would still consider the same procedures and culture not right for monitoring the internal market, so to copy and paste legislation created for the competition field is not appropriate. I mention again the different approaches of DG COMP and DG Internal Market as an illustration.
In this group, I am further probing the constraints on information-gathering powers. As I have said, they often apply to individuals and businesses that have not done anything wrong, nor have their actions, individually or collectively, distorted the market. If the regulations are amiss, that is created by Administrations. With all due respect to the response the Minister gave on the previous group, that is different from competition matters, which the businesses and their actions have brought forward. I find it alarming that there is no understanding of the fundamental difference between applying competition law and monitoring an internal market, but it is early days and this is all new.
I accept that an investigation into and report on the activities of companies that are causing distortion, as could be the case under Clause 31, is different. Then, it is perhaps reasonable to use the existing CMA powers and scope. But I can assure the noble Lord, Lord Stevenson, that the format of these enforcement powers is copied and pasted from the CMA in its role dealing with companies that potentially threaten the public interest, where there is at least a suspicion that competition laws or norms, such as market concentration or fair pricing, are being challenged. In the Bill, individuals or companies are being used as sources of information for things that they have not brought on themselves, and that is the difference. It is why having the same laws is not appropriate. For this reason, I object to the compulsory scope of Clause 38 for all circumstances, and the same applies to the enforcement and penalty powers in Clauses 39 and 40.
Clause 38(6) states that the notice will be sent with
“information about the … consequences of not complying”.
That is a frightener. Is that the way to treat business? Was it consulted upon? We challenged the Minister on Monday about the information he had been given to say to us, stating that using the CMA was consulted upon. Even if there were a few throwaway lines like “such as the CMA” in response, was any consultation conducted on whether CMA market study legislation fits the rather different circumstance of investigating Administrations’ actions? If businesses or individuals decide that they do not wish to or cannot provide information, and the CMA decides, under its own rules, that their excuse is not reasonable, they can be dealt with as obstructing and fined.
There was an interesting exchange on fines on Monday, when the noble Baroness, Lady Finlay, asked whether a Member of the Senedd could be fined. The Minister said that they could be asked for information, but not fined. Now we see another way to get some of that information: turn any business that had been in discussions with the Senedd into the informer. Who knows? Perhaps one day we might even get some of the unpublished consultation responses that the Government sit on.
The only ray of hope is a reasonable excuse for failing to comply, and I would like guidance on what is reasonable. Is it a reasonable excuse that the person does not have time or cannot afford to attend wherever they are summoned, from a loss-of-earnings perspective? Is it a reasonable excuse that the businessperson concerned also has childcare responsibilities, which make it difficult to attend as well as costly? Is it a reasonable excuse, as there is no suggestion that they have done anything wrong and it would be inconvenient, that they wish to decline to do it? Is it a reasonable excuse that they do not have ready estimates and forecasts, and that it takes them away from fee-earning work to construct them? Is it a reasonable excuse that they do not keep those kinds of records? Is it a reasonable excuse that a Member of the Administration has the information and has declined to produce it?
Freedom of information requests can be declined for taking too much time and involving too much expense. Does a similar consideration apply here, at the discretion of the person from whom the information is sought? Why is it any different when they have not done anything wrong? The Minister knows full well that businesses want a smooth-running internal market but, frankly, how many board members want to add CMA or OIM internal market information requests to their risk register? A good place to do business—what are you thinking?
On the other side, there are also circumstances where much more has been opened up for challenge by businesses through Clause 31, giving reach into administrative decisions; and, as mentioned in the impact assessment on page 29, legal actions may occur, possibly as a follow-on. This may also extend beyond UK shores, so can the Minister explain the scope for investigative actions from other countries that the provisions in the Bill create? For example, will the CMA accept third-country complaints under Clause 31? Or, when we get to it next week, under the wording in Clause 50, what third-country actions are opened up in services that are beyond the WTO provisions? Using the example mentioned by my noble friend Lord Fox, an English water company might actually respect the mutual Welsh water companies, but could a foreign water company intervene?
I am assuming that the noble Lord, Lord Naseby, has scratched from this group, so I call the noble Lord, Lord Tyrie.
Some very interesting points have just been made that bear serious consideration, and the concerns we have just heard are reasoned, particularly on SMEs. At the very least, the Government may wish to offer a review of the CMA’s use of these powers, after an interval, to give us the assurance that they are being proportionately deployed and to see whether they need some amendment. The argument that they were derived from legislation the purpose of which was very different is well taken and might point to further amendment.
Overall, I support the Government in what they are trying to do here, having decided to create the OIM. It is true that the powers are robust, but they will need to be. If the CMA is to be expected to offer timely and high-quality advice, it will need to secure information quickly, without being given the runaround by devolved Administrations or parts of the private sector.
The penalties proposed are a weakness, though. Crown immunity will be in play for the devolved Administrations. I would be interested to know what thought the Government have given to the penalties that can be imposed for non-compliance in those cases. Public censure might help; on the other hand, a devolved Administration standing up to nasty Westminster might win local plaudits, resulting in the opposite effect. A lot of careful thought needs to be put into this issue if these measures are to be made effective. The proposed fines on the private sector are capped at £30,000. I simply do not see that sum troubling a recalcitrant or determined large third party. Has the Minister considered larger fines in certain circumstances?
It might be helpful to make one more general point. The CMA’s existing arrangements for securing compliance and information gathering across all its other functions are manifestly inadequate, as I saw it during my time there. They should not be used as a benchmark. Incidentally, the £30,000 figure comes from the merger regime. Something has to be done. The European Commission recently fined Facebook £1.6 million for not supplying information, while the CMA recently fined Amazon £30,000 over the merger with Deliveroo for not supplying information. That should give some idea of the disparity.
In February 2019, the CMA put proposals to the Government for improvements to information-gathering powers across all its functions. First, it needs to be able to gather information from a much wider range of sources to reflect the increasingly digital nature of the information that it is trying to collect: iCloud, machine-learning algorithms and so on spring to mind. These are not at all easy to capture with existing legislation. Secondly, and even more importantly, subject to safeguards, the CMA needs a general information- gathering power outside the context of a formal investigation. I do not like giving general powers, but I think the CMA now needs this to find out what is really going on in markets and enable it to think through much better than it can at present. It needs to be able to use the full range of tools to best bear down on consumer detriment. It is struggling to do that at present, and increasingly so with the growth of rip-off culture.
When the Minister returns to his department, he will find the proposals, of which I am just touching the surface, have been fully developed by the CMA and are sitting with his officials. Will he agree to take another look at those proposals to see what might usefully be drawn from them? For improving the ones we are discussing today, quite a lot of what is in there is likely to be relevant. Will he agree to report back to the House on what he has found?
I have been following this Bill closely, particularly Part 4, which I have an interest in because of my previous job. Some very important points have been made across the Committee, not least in Monday’s relatively brief debate on Clause 28 about whether the CMA is the appropriate body in the beginning to have responsibly for these functions. Those points are sufficiently important for us to have another look at them on Report. I hope the House will find a way to enable us to do this.
My Lords, this Committee is nearing its end, apart from Part 5. I support the noble Baroness, Lady Bowles, in her forensic efforts to probe the purpose of Clauses 38 to 40. I welcome my noble friend Lord Tyrie to today’s debate. Although I do not agree with him on fines or general powers, he makes a very good point about digital information. I am sorry he was not here for the debate on where the OIM sits. As he says, that is something we hope to debate again on Report.
On the plus side, these clauses give a great deal of detail. I usually complain to the Minister that EU exit Bills fail to do just that and leave too much to regulations. On the minus side, these are extremely strong powers of enforcement with very high penalties—for example, fixed fines of up to £30,000 would make many a small company bankrupt. There is no due diligence defence that I can see or provision allowing a reasonable excuse. The CMA can use its own discretion to decide whether a request for information has been complied with and can impose a financial penalty if it thinks there has been obstruction or delay. Such powers are fiercer than those of the police. The Minister will be able to tell us whether the CMA has those powers in relation to competition law and perhaps explain in each case why they are justified in the internal market Bill which, as many have said, is a little different from competition law.
Moreover, we do not know to which regulations these various measures and penalties will apply. Can the Minister kindly take us through some examples of their proposed use? He may have done this elsewhere; if so, I am sorry if I missed that. Perhaps more importantly, could he lay some sample regulations for us to review before Report, as his predecessor did so helpfully on the Bill relating to nuclear issues on EU exit?
I worry that both Houses of Parliament have been distracted by unease with Part 5 of the Bill into agreeing wide-ranging, open-ended and burdensome powers in these clauses and, for the first time, on services, the beating heart of the economies in all four nations of the UK. All this has been relatively lightly scrutinised despite our efforts, and experience shows that some nasty surprises might be in store. I am keen to work with others to minimise those while generally supporting the Bill’s direction of travel.
My Lords, once again this has been a short but important debate. I congratulate noble Lords on speaking on this. Once again, I find myself in complete agreement with the noble Baroness, Lady Neville-Rolfe, and my noble friend Lady Bowles. It was good to hear from the noble Lord, Lord Tyrie, whose experience is important.
During her speech, my noble friend Lady Bowles sought to characterise the difference between getting information from potential recalcitrants—people who are suspected of or known to have distorted the market—and getting information from people to create a picture of a market. I hope the noble Lord, Lord Tyrie, will not mind me saying that the sort of language used about needing more sanctions and similar issues is coming from the mindset of dealing with recalcitrants. That is where the experience of the CMA has lain to date. There is a real concern that in creating this new role the culture of having to fight to get what you need is transferred into this second activity, and that is not appropriate.
I was interested to hear the point of the noble Lord, Lord Tyrie, about Clause 28 and looking again at the positioning of the OIM and CMA. I would be very keen to hear what he has to say.
Perhaps the noble Lord can put his point in writing, or speak after the Minister if it is a question to him.
Enormous care is needed, at the very least, but it is not clear in the Bill where that care is and how careful the Bill is; it seems quite careless. We come back to whether the Bill is deliberately underwritten or accidentally underwritten because there was not enough time. There is plenty of scope for the Minister to answer the questions set out by my noble friend Lady Bowles, the noble Baroness, Lady Neville-Rolfe, and the noble Lord, Lord Tyrie, and to nail how this will work, what it is for and how small and medium-sized businesses in particular will be protected from an overzealous information-gathering process.
My Lords, this debate is perhaps even more important than some of the others that we have had. The real advantage of a stand part debate is that one can question the purpose of a clause rather than getting down into the weeds of amendments.
The issue that the noble Baroness, Lady Bowles, has raised is fundamental to how we have been looking at this. She asked—these are actually my words, although the noble Baroness, Lady Neville-Rolfe, said much the same—whether the competition regime was appropriate for work on the internal market. I am sorry that the noble Lord, Lord Callanan, gave away in an earlier debate that this may have been written hastily over the summer; it certainly sounds like a cut-and-paste job, done without stopping to think. Just because it is the same organisation at the same address in Holborn, or wherever the CMA is these days, you cannot just cut and paste it; as the noble Lord, Lord Fox, was saying, it is about the culture of that organisation as well as whether the structure is available. There is a fundamental question here, which my noble friend Lord Stevenson dealt with under Amendment 115, of whether the OIM should be within this framework, as well as the even broader subject of whether these sorts of penalties are appropriate for such a different role.
There are some specific issues in these clauses, such as whether it is appropriate for the Government to be able to amend the list of exclusions without any involvement of the devolved authorities. We have discussed such matters before, but under this legislation the fixing of penalties could again be altered without any involvement of the devolved authorities. This is serious stuff. They are a part of the overall governance and working of the new internal market, yet the Bill is written as if this is simply a Westminster responsibility.
I come to what the noble Baroness, Lady Neville-Rolfe, was saying: exactly what is covered by these clauses? In an earlier debate I asked the Minister to set out what services were covered, but obviously I was mumbling at the time because he wrote me a very nice letter on 2 November telling me about the services that are excluded, which of course already exist in the Bill. The question that I was trying to ask is: what services will be covered? I still cannot get a handle on that. This is really important given what has been said about whether the demands and penalties applying to services that are covered are appropriate.
Obviously I was not very clear about what I wanted but I had talked about housing and whether someone organising a register of housing would count as a service. I was talking about landlords but the letter refers to social housing. We are talking not about social housing but about landlords of private housing. I am involved with another part of the Government, the Ministry of Housing, Communities and Local Government, in chairing something to try to set up a code for property agents for when the Government are ready to fulfil what they have already promised—that is, to set up a regulator of property agents. They are already a service but the circumstances are different—buying and selling a house in Scotland is very different from England; if you buy there, you tend to go to a solicitor rather than an estate agent—so there are different ways of a service being developed or in existence. Once they are regulated, perhaps property agents will count as a profession, which is a different issue, but before then, as a service, are they going to be covered by these sorts of requirements?
If that is the case—and this is the main thrust of what I want to say on this group— how will these services know that they are covered by this provision? It is important for anyone risking breaking the law, in the sense of civil law, and being charged a penalty to know that that law applies to them. If they do not define what they are doing as a service and therefore do not know that they are captured by this provision, they may find it difficult to understand that they could be required to provide information. I can imagine that this could really affect property agencies. They need to know that it covers them, which is quite an issue, but it is also unclear to me whether the level of penalties is appropriate for this area. For a small housing management group, for example, this daily rate of £15,000 will basically wipe out its business if it has an £80,000 annual turnover. We are talking about levels of penalty.
It seems to me that those agents are covered by this, but I am unclear about the appeals process. If they are asked a question, how do they know that it has legal force behind it? Even if they are told that—most of these people will of course not have lawyers —and there is a penalty, do they have any appeal? I could not find one in the Bill but I am sure the Minister will be able to tell me; it is quite unusual to have a penalty without any sort of appeal. I could not work this out but I am sure the Minister will.
My main ask is: can we know the sort of services that will be covered? Perhaps we could hear more—not in legal language but in language that I can understand—about how they would know and about their rights to appeal any fixed penalty.
I thank all noble Lords who have taken part in this debate. I apologise to the noble Baroness, Lady Hayter, if she found my letter disappointing; I will try to do better next time. The noble and learned Lord, Lord Falconer, looks disapproving; I am not going to write him any more letters if that is the case.
With regard to exclusions on services, all services subject to the authorisation requirements or the regulatory requirements are affected under the Bill unless they are specifically excluded from some or part of the rules under Part 2. I hope that that clarifies the noble Baroness’s question—if not, I will be happy to write her another letter. She is shaking her head in disbelief.
I say to the noble Baroness, Lady Bowles, with regard to her question on consultation, that we consulted on the general office, what enforcement provisions there should be and whether or not it should be included as part of an arm’s-length body. Once we had made the decision that it should be located within the CMA, there was of course extensive discussion between officials and the CMA on the powers and how they will be enforced. I say to my noble friend Lord Tyrie that I am of course aware of the proposals that he refers to on the CMA and I will be happy to take another look at them.
Addressing the specific questions on this clause stand part debate, I will set out the rationale for these clauses. Clause 38, as I believe we already discussed in the previous group, sets out the powers that the Competition and Markets Authority will have to gather information in support of its monitoring, advisory and reporting functions. As I said previously, in order to carry out its functions the OIM must have access to high-quality information to produce accurate, relevant and credible reports. Clause 38 will ensure that the CMA is able to require the assistance of third parties to perform its functions and is able to independently gather evidence in a timely manner.
I hope that the noble Baroness, Lady Bowles, agrees with me that presenting analysis based on partial or inaccurate information could be detrimental to the regulatory decisions taken as a result of OIM reporting and monitoring and would damage the reputation of the OIM among many key stakeholders in these fields. The powers in this clause are therefore put on a strong statutory footing. They will ensure that the reporting that the OIM undertakes will be as effective and comprehensive as possible for the benefit of policy-makers in the UK Government and the devolved Administrations, significantly strengthening existing stakeholders’ ability to navigate the new UK internal market.
Clause 39 describes what action the CMA is able to take in response to non-compliance with the information requests described in Clause 38. As noble Lords said, the CMA has existing powers under the Enterprise Act 2002 regarding non-compliance with its information requests. This is necessary to enable the CMA to carry out its functions effectively. As with Clause 38, the provision for the OIM in Clause 39 is modelled on those powers. The clause will allow the CMA to determine the most appropriate policy approach and the amount of any financial penalty to be imposed within the limits that have been prescribed. The clause also sets out the conditions where financial penalties may not be imposed because more than four weeks has expired since the CMA exercised its relevant functions.
Clause 40 sets the parameters that the CMA should consider for financial penalties in cases of non-compliance with an information-gathering request notice. Let me first say that I understand the concerns of noble Lords, but the preference and expectation will always be that information gathering is on a voluntary basis. The Government do not anticipate that the CMA will need regularly to fall back on the information-gathering and non-compliance powers. However, it is important to ensure that this facility is available to the CMA to detail how penalties will be set. As with other provisions, the Government have chosen to mirror the relevant provisions of the Enterprise Act 2002.
I can say to the noble Lord, Lord Tyrie, and my noble friend Lady Neville-Rolfe that the Secretary of State will make regulations specifying the maximum amounts in practice within the specified ceilings for these penalties in consultation with the CMA and other interested parties. I can confirm for the benefit of the noble Baroness, Lady Hayter, that the devolved Administrations will of course be consulted as part of this. In addition, and as noted in our debates on previous groups, I confirm to the noble Baroness, Lady Bowles, and the noble Lord, Lord Tyrie, that the CMA will not be able to issue a financial penalty against the UK Government or any devolved Government. Let me be very clear about that. Let me also assure the noble Baroness, Lady Bowles, that the Government are committed to not taking any steps to bring in the financial penalties until there is credible evidence that there is a need do so, so we will not commence these provisions without that credible need being demonstrated.
I will deal with a couple of other questions. The noble Baroness, Lady Bowles, asked about third-party requests. Such requests would be permissible if they were within the scope of Clause 31 and the CMA thought that they were appropriate. As I confirmed earlier, the White Paper invited consultation responses on how the functions to be delivered should be implemented as well as on whether an existing arm’s-length body should deliver them or bespoke arrangements should be established. As is obvious, we decided after that consultation that the OIM should be situated within the CMA.
With the reasons I have set out, I hope that I have been able to reassure noble Lords on their legitimate concerns and on why this clause should stand part of the Bill. I hope that the noble Baroness will feel able to withdraw her amendment.
I have had a request to speak after the Minister from the noble Lord, Lord Fox.
My Lords, I thank the Minister for his answer. I have two questions. First, does the Minister understand the difference between a voluntary activity and a voluntary activity where there are potential fines? It is the difference between cleaning the house voluntarily and cleaning the house knowing that I could have my tea withdrawn if I did not. There is a very big difference. That needs to be understood in terms of the culture of the way in which this information is sought. Does the Minister understand that difference?
Secondly, my noble friend Lady Bowles asked a series of questions about what is permissible as a reason for not delivering information. There was a huge multiple choice question and an overarching question. I think that the Minister dodged—sorry, I withdraw that word. The Minister did not answer any of those points. They were an important element of my noble friend’s questions so will he address them, perhaps generally today and more specifically, bearing in mind the very specific questions that she asked, in one of his letters?
With regard to the noble Lord’s first question, I understand why his cleaning abilities might not be up to standard and he might not get his tea. With regard to the questions asked by the noble Baroness, Lady Bowles, on reasonableness, we certainly do not intend to create disparity within the CMA over the functions it carries out and the processes it follows.
To be serious, of course I understand the difference between being asked to do something voluntarily and being asked to do something voluntarily with the back-up of potential penalties. The powers and penalties in question are similar to those used by the CMA for its existing functions, such as conducting market studies. This will ensure consistency in the way that the CMA, under its existing and its OIM capacities, interacts with stakeholders across all its functions. We do not intend to commence the powers on fines until it is proved that they are necessary, as I said.
I have had a request to speak from the noble Baroness, Lady Neville-Rolfe.
I thank my noble friend for his assurance on commencement. He did not answer my specific questions, but I think that the answer in general terms was that the Government have taken the same powers as the CMA has on competition and applied them pro rata. Perhaps I can pick up something that the noble Lord, Lord Stevenson, said earlier. I wonder whether we could look at this line by line to see whether things are or are not all the same; that would be a helpful Committee-type process.
I really got up to ask a question about examples. The Minister helpfully gave an example of a penalty regulation—he said that he might make regulations with penalties under £30,000, perhaps at a lower level for particular things—but I am confused about what kind of regulations are going to be made here. That may be an impossible question to answer but if my noble friend could give us some more examples, perhaps ones that are in draft or have gone out to consultation, it would be incredibly helpful.
I referred in my earlier speech to the need to make regulations setting the maximum penalty, which the Secretary of State will do, but I will write to my noble friend if there are any other examples of regulations that we feel we may need to make.
Does the noble Baroness, Lady Bowles, wish to respond to any of the points made?
Yes. My Lords, I thank all noble Lords who have spoken in this debate; I think that it will be even more interesting when we read it in Hansard.
I think that there is still a sticking point, which was exemplified by one of the Minister’s comments. He said that he did not want there to be disparity between procedures in the CMA. The point that I have been making, which seems to have been supported by all the speakers in this debate, is that they are for different things. The noble Lord, Lord Tyrie, acknowledged that it was for a different purpose. My noble friend Lord Fox referred to people being recalcitrant rather than doing nothing. I was trying to say that, within competition policy, the Government are pursuing miscreants, but they are pursuing innocent people for information. In fact, at the beginning of his response, the Minister said that the purpose is to gain the assistance of third parties. That was the first time I had heard a reasonable word about this. The Government are asking the private sector to give assistance. They can go to the devolved Administrations but there is complete asymmetry: the Government cannot fine them but people who find it too difficult to give assistance are at risk of a fine.
Of course we expect reasonable behaviour, but we do not always get it. I point to that wonderful machinery of HMRC on loan charges and ask whether we have evidence that we always get reasonableness where we want it. I am not yet satisfied. There have been some interesting suggestions about reviewing how it has gone, that we can have sight of the regulations, or that we can examine procedures that are likely to be implemented. Surely we could do some of these things between now and Report.
I still think that where we are essentially sampling and wanting views from people in the market, the burden is on the sampler, not the samplee. This is therefore a matter I wish to return to on Report, but I hope it is something we can solve. On Monday on our first group, people said that patent attorneys were vital for the country, so I had a smile on my face. Maybe now noble Lords actually know where I learned to be a nerdy pedant.
The point is that we have to have protections in the Bill where, if something unjust happens, somebody can say, “Hang on a minute, look, it says here that that excuse was reasonable,” or, “You can’t make me do this because I haven’t done anything wrong.” You cannot go around arresting people without reasonable suspicion. I do not think we should fine people without reasonable suspicion that something wrong was done in the first place. We cannot just invent a wrongness by saying, “I wanted you to give me some information and you said no”, which is basically what the powers in the Bill do.
I thank noble Lords. I look forward to a letter with some more answers to my questions from the Minister. I do not think there is anything to withdraw because this is a stand part debate, but obviously I will not call a vote.
Clause 38 agreed.
Clause 39: Enforcement
Amendment 151 not moved.
Clause 39 agreed.
Clause 40: Penalties
Amendment 152 not moved.
Clause 40 agreed.
We now come to the group consisting of Amendment 153. I remind noble Lords that anyone wishing to speak after the Minister should email the clerk during the debate. Anyone wishing to press this amendment to a Division should make that clear in debate.
153: After Clause 40, insert the following new Clause—
“Duty to consider the internal market when considering mergers
In section 58 of the Enterprise Act 2002 (specified considerations) after subsection (2E) insert—“(2F) The need to promote the better operation and improvement of the United Kingdom internal market is specified in this section, having regard to—(a) the need to promote research and development and innovation in new and existing industries and enterprises, and(b) the need to act in the interests of United Kingdom public policy.””
My Lords, before I speak to the amendment, I will slightly cheekily ask something about the previous group. At the very end the Minister said that the Government would not commence the powers unless they felt they needed to, or some words like that. As he indicated, each bit of the Bill can be brought into force on different days, as the Secretary of State may by regulation decide. When the Minister responds could he say whether that would be by the affirmative procedure and whether the House would consider the commencement date at that point? He could have some assistance if he does not know. How such things are done is beyond my understanding. It would be quite interesting to debate at that point whether the powers should be taken. I am sorry to ask the Committee’s indulgence to deal with the previous group, but I am sure that everyone is very forgiving.
Amendment 153 seeks to insert into the CMA’s powers a clear and specific reference to the need, when regulating takeovers in the new and initially demanding internal market, to promote research and development and innovation in new and existing industries and enterprises, as well as the need to act in the interests of UK public policy. The latter point is key to attracting long-term investment, as the CMA needs enhanced tools to intervene against hostile takeovers.
There has been a catalogue of such hostile takeovers, such as of GKN by Melrose in 2018—surely a bleak day for British industry, with perhaps 6,000 jobs with the UK’s third-largest engineering company suddenly in the hands of new owners following a very narrow vote by shareholders in favour of the takeover of a 250-year old company. That vote was swung by hedge funds and arbitrageurs who owned 25% of the shares, which had been very recently acquired. Their short-term interest in making a quick profit came at the expense of the jobs, skills, research and development of this major industrial company, to the detriment of UK plc. Needless to say, the result has not been good. Not all takeovers are bad, but when Melrose’s own website describes its strategy as “Buy Improve Sell”, with its objective to achieve a significant increase in shareholder value often in as little as three to five years, one has to ask whether this is in the interests of UK plc.
Last year, Unilever, our third-biggest company by market value, only just escaped a hostile takeover bid from Kraft, which took over Cadbury in 2010. Unilever’s proposed move of its registered office to Rotterdam, which did not actually take place, would have meant that Dutch law, which provides a public interest defence for the company from predators, would have been available. Sadly, we do not have that in UK law. We must now strengthen our laws against hostile takeovers and takeovers generally that are not in the public interest, not just because it is the right thing to do but to encourage long-term UK and overseas inward investors that their investment is safe from short-termism.
Until recently, the law provided only three grounds on which the Business Secretary could refer a takeover to the CMA, which then decides whether it should be blocked. The first is media plurality, the second UK financial stability, and the third national security. The addition of a fourth—public health—earlier this year was most welcome, as it allows for, in its words:
“The need to maintain … the capability to combat, and to mitigate the effects, of public health emergencies”.
Ideally we should add a fifth—the need to foster and promote research and development and innovation in new and existing industries and enterprises—and a sixth: to act in the interests of UK public policy.
As the Business Secretary I think accepts, there remains a concern about foreign takeovers of British companies on the cheap. We need to ensure that, in considering relevant takeovers, the Business Secretary can refer a takeover bid, and the CMA should be able to consider whether the bid is in the interests of research and development or science and technology, or in the public interest generally. That would cover cases where the national interest should be considered, but where the definition happens not to fit neatly into one of the existing categories.
I acknowledge that any such new grounds for referral by the Business Secretary are outwith the Bill’s scope, but as the CMA now stands more alone in the world of competition regulators outside the EU family, we need to give it the tools, as it oversees the development of the internal market, to put the national interest and support for research and development clearly into its thinking and terms of reference. This will help UK plc to build back better after Covid, in the national interest. This is something the Bill allows us to do, adding a useful tool to what the CMA will do. I beg to move.
My Lords, the idea behind this new clause has validity, and particularly will after the pandemic, whenever it is over. There is little doubt that some companies will be strong after the pandemic because they happen to be in a particular market, and others will be extremely weak and looking to be rescued somehow. The only problem I have is that the new clause refers to the
“duty to consider the internal market”
when in fact, that is the only market that will apply from 1 January onwards as far as the UK is concerned. So, it is not as though it is one of several markets; it is the only market in my judgment.
The noble Baroness is quite right that in some of the markets, there are already signs that things are happening. In the fintech market, things are undoubtedly moving quickly—for example, in sections such as payments and operations. You only have to read the Financial Times regularly, as I am sure a lot of noble Lords do, to see that things are moving all the time there. Equally, a fair number of our universities have what you might call cradle operations or primary operations, whereby they are looking to develop research that they believe might be marketable. Many are quoted companies; others are not. There is a lot of activity happening.
Although it is undoubtedly true that we want to see both paragraphs (a) and (b) happen, given the original role of the CMA, which emerged from the Monopolies and Mergers Commission, I think it pretty inconceivable that it would not look at these aspects. My noble friend on the Front Bench will be able to clarify that more than I am able to.
If there is not sufficient cover within the current Bill and other parts of the law, I hope my noble friend will look upon the amendment seriously. If that degree of cover already exists, I can understand why, although the issue is worth looking at and talking about, it may not be appropriate to deal with it in a new clause.
I rise to speak to Amendment 153 in the name of the noble Baroness, Lady Hayter. This is a new clause relating to mergers that might affect the internal market. She may have a reasonable point that this is a matter of public policy about which we should be concerned. It is odd the way mergers involving an overseas player without a UK business cannot be stopped under merger law—think Cadbury, think ARM, as well as GKN Melrose, which the noble Baroness, Lady Hayter, explained was a particularly heinous example—because there is not the necessary lessening of competition. Although she did not say so, perhaps there is a parallel concern about takeovers important to one of the devolved nations or to a particular R&D base.
However, I do not think this is a big risk, as representations would be made to the CMA and taken into account in consultation and decision-making by the CMA, which is domestically focused and operates across the UK. My concern is that the new clause would be a major change to the way merger law works; I do not think it right to try to change one aspect in this Bill. Therefore, I cannot support this amendment.
My Lords, I support the new clause in the name of the noble Baroness, Lady Hayter of Kentish Town. As she said, it would insert into the CMA’s powers a clear and specific reference to the need, in the new internal market and the regulation of takeovers, to promote research, development and innovation in new and existing industries and enterprises, and to act in the interests of UK public policy.
We already know that the CMA has a number of responsibilities, including protecting consumers from unfair trading practices, investigating mergers between organisations to prevent a reduction in competition and taking enforcement action in relation to anti-competitive practices by businesses and individuals. It will have more burdens as a result of the Internal Market Bill. Put simply, it will be responsible for strengthening business competition and preventing and reducing anti-competitive practices.
The new clause seeks to nail down the role by referring to promoting research, development and innovation in new and existing enterprises. It would also assist with business development and innovation and in so doing, help to encourage overseas investment with job creation and sustainability—central facets of UK economic policy. It could also help to steady the market.
The Institute for Government has already stated that there is a clear gap in the Government’s plans for how governance of the internal market will function at a political level, and it is not clear how disputes concerning the functioning of the internal market will be managed. It is therefore important that this power be inserted to ensure greater protections where there may be hostile takeovers.
In devolved Northern Ireland, companies are generally small. However, the agri-food sector would sit under the new dispensation via the Northern Ireland protocol. There have been takeovers by companies based in the Republic of Ireland, so how would that fare if there were problems with the competition elements in the internal market Bill? The new clause in the name of the noble Baroness might assist in this regard.
The Institute for Government also notes that the office for the internal market within the CMA has very limited powers and, in many cases, can choose not to exercise them. It is worth noting that it can also request specific documents from any individual, business or public body to support its functions. Although it will be able to impose certain financial penalties, it will not be able to request any information that a business, individual or public authority would not be compelled to reveal in court, hence this new clause, on the need to promote the better operation and improvement of the UK internal market.
I therefore have no hesitation in supporting the new clause. It would promote much-needed research, development and innovation in new and existing industries and enterprises, and pump-prime UK public policy on the economy and finance in particular.
My Lords, at the outset I should say that, because of my past but discontinued interests, I will not be speaking to the specifics of the example that the noble Baroness, Lady Hayter, brought up; rather, I will speak generally on this issue.
I speak to support the spirit of this amendment. It is a shame that the noble Lord, Lord Tyrie, is not still here because I would have welcomed his view on this issue. As the noble Baroness, Lady Neville-Rolfe, said, there are examples of Secretaries of State who wanted to do more but were constrained, and Cadbury is a good example of that.
However, after two dozen or more hours in Committee, I find myself at last coming to agree with something that the noble Lord, Lord Naseby, said, and that is that this issue goes wider than simply the nature of the Bill. The noble Baroness, Lady Neville-Rolfe, said the same thing. It is an important issue, so we should be thankful that the noble Baroness, Lady Hayter, has brought it up. It is clearly inadequate; the Secretary of State needs a better armoury to assess the public interest and deal with what will undoubtedly be, as the noble Lord, Lord Naseby, said, a flood of potential acquisitions and hostile takeovers.
This may not be the right Bill to be doing it in, but it is a big issue. That said, it also opens up the question of how the new office for the internal market relates to the Secretary of State and the CMA when it is dealing with a hostile takeover that the Secretary of State has called in. As the Bill stands now, allowing for the fact that the Minister may not accept the amendment, how do the Government envision the interactivity between the office for the internal market, the CMA and a hostile takeover bid that the Secretary of State has called in? Who does what, and where?
I thank the noble Baroness, Lady Hayter, for her amendment. I understand her concerns but, as I am sure she is aware, the internal market Bill is concerned with protecting the flow of goods and services across the UK after the end of the transition period. It is not concerned with the general merger regime, nor with Ministers’ powers to intervene in mergers. Noble Lords should be aware that they will have the opportunity to debate these matters further in the Government’s forthcoming national security and investment Bill.
Will that be soon?
It is forthcoming. Noble Lords will know that I cannot go further in terms of dates. It was flagged up in the Queen’s Speech and is forthcoming.
The grounds for ministerial intervention in mergers are deliberately precise and limited, in order to maximise transparency and predictability for businesses. The effect of the amendment would be to broaden the grounds upon which Ministers may make a public interest intervention in mergers. This would constitute a significant change to the UK’s approach to merger control which, as noble Lords observed, currently puts the emphasis on competition-based assessments by the Competition and Markets Authority, with narrow and specific grounds for ministerial intervention.
It is not clear how such a change would materially assist with the effective operation of the UK internal market which is, of course, the focus of this part of the Bill. The CMA already has significant powers and expertise to investigate the benefits and risks of mergers in relation to competition. An excessively broad power to intervene in the affairs of investors, shareholders and company boards risks stifling competition, innovation and creativity. This could lead to worse outcomes for both businesses and consumers, as well as stifling inward investment. For these reasons, I cannot accept the amendment and hope that the noble Baroness will withdraw it.
Before I sit down, I will answer the other question which the noble Baroness asked about the previous group. The power for the Secretary of State to specify the maximum penalties for breach of information-gathering notices will be brought in by negative SI. This mirrors Section 111(4) of the Enterprise Act 2002.
The Minister is very polite. What he really wanted to say to me was: “Nice try”. There is a serious point here. As I said in my introduction, I know that the basic power is outwith the scope of this Bill, but there is some urgency to this question. The noble Baroness, Lady Ritchie, used the words “greater protections are needed against hostile takeovers”. They may not be exclusively from outwith the UK, but those are some of the ones where there have been particular problems. I think it is agreed that, as the noble Baroness, Lady Neville-Rolfe, said, there is a weakness in our armour because you cannot argue against them on the grounds of competition. I thank the noble Lord, Lord Naseby. The problem is that it is not within the tools of the CMA. It cannot use as a ground the need to either respond to public policy or promote particular industries. If it does not affect competition, it is not within its powers.
This does need to be added. The noble Lord, Lord Fox, is right that this is perhaps not quite the right mechanism, but we are delighted to know that there is a Bill coming and I look forward to the Minister accepting an equivalent to Amendment 153 at that point. I will, needless to say, use today’s Hansard to support that amendment to get this in then. I look forward to the noble Lord, Lord Naseby, and other noble Lords supporting me at that time.
I wanted to table the amendment to this Bill because of the changes there will be when we have got the internal market growing and we are looking for new investments. Even those who think everything is going to be wonderful after Brexit know that we are going to need a lot of support to get the economy going again after Covid. There is a slight weakness, so it would have been nice to have been able to put this clause in at this point. It was a nice try, but I beg leave to withdraw the amendment.
Amendment 153 withdrawn.
Amendments 154 to 156 not moved.
Clause 41 agreed.
Amendment 157 not moved.
Health Protection (Coronavirus) (Restrictions) (England) (No. 4) Regulations 2020
Motion to Approve
My Lords, we have come to a critical juncture. Incidence rates are growing, and the NHS is under increasing pressure. The ONS now estimates that approximately 568,100—one in 100 people—in England have Covid-19. That has risen from one in 2,000 in July, and one in 240 at the beginning of October.
The Prime Minister explained things very clearly in the other place. The R number is above one in every part of England, the virus is spreading even faster than the reasonable worst-case scenario, there are already more Covid patients in some hospitals than there were in the first wave, and, even in the south-west, current projections mean that we will start to run out of hospital capacity in a matter of weeks. The chief executive of NHS Providers, the membership organisation for NHS trusts, said:
“Looking forward, there is a clear and present danger that the NHS will not be able to treat all the patients it needs to in the best and most timely way.”
The modelling presented by our scientists suggests that, without action, we could see up to twice as many deaths over the winter as we saw in the first wave.
I recognise that some noble Lords are sceptical about whether the full range of measures in these SIs is needed right now, or whether they are needed at all. I acknowledge the concern that perhaps the cure does more damage than the disease itself, but that is not the belief of the Government. Without action, the NHS will be overwhelmed, which could put life-saving procedures, cancer therapies, emergency services and diagnostic investigations at risk.
It is true that we are much better prepared than before, with large stockpiles of PPE and ventilators, the Nightingales on standby and 13,000 more nurses than last time. However, the virus is growing exponentially, far faster and heading far further than we could ever conceivably add capacity for. Even if, by some incredible national effort, we doubled capacity, that gain would be consumed in one gulp of the virus doubling once.
Meanwhile, the scientific evidence shows us that the measures have worked and lives have been saved. The analysis of my department, the Office for National Statistics and the Government Actuary’s Department has shown that the mitigations we have put in place have prevented more than 500,000 deaths, and our previous sacrifices and efforts have therefore saved us all from untold personal heartache, civic pressure and economic disruption.
However, we recognise that these interventions are difficult for many people, and that is why we have evolved our approach from the first wave and the previous lockdown. I will say a few words about this. For the first lockdown we paused non-urgent care to stop the NHS being overwhelmed. This time, we are maintaining as many NHS services as possible. In response to arguments made forcefully by noble Lords in this Chamber, we are prioritising education—doing everything we can to keep open schools, colleges, universities, childcare and early years settings.
We have taken steps to mitigate the impact on the vulnerable: the new lockdown measures include allowing support and childcare bubbles, support groups and unlimited outdoor exercise, for instance, to continue. We have amended guidelines to suggest that the clinically vulnerable and the over-60s should minimise their contact with others, and the clinically extremely vulnerable should work only from home, rather than asking them and their households to shield themselves, as we did for the first lockdown. On funerals, we have changed the Covid-secure guidelines to allow up to 30 people to attend.
Lastly, we have improved how we work with local authorities to support them in responding to this crisis. My department has regional teams made up of PHE regional directors, Contain regional convenors and Joint Biosecurity Centre regional leads, who work continuously with local authority chief executives, the directors of public health and local resilience forums. I pay testimony to all those noble Lords who have brought this challenge to our attention. These groups attend local incident management meetings and outbreak boards as well as meeting more informally. They also organise meetings at a regional level to share good practice and help areas support each other through mutual aid.
In relation to those who are less privileged and in the area of financial support—another subject raised by noble Lords—we completely recognise that these measures are difficult for the general public and business, which is why we will provide support to protect jobs and get people through the crisis. This includes extending the furlough scheme until the end of November, helping with mortgages, helping the self-employed—as the Prime Minister outlined earlier this month, we are doubling our support from 40% to 80% of trading profits—extending the deadline for applications to the Covid loans schemes, cash grants of up to £3,000 per month for business premises closed as a result of the national lockdown, additional funding worth £20 per head to enable local authorities to support other business affected by the lockdown, and other measures.
My final points are on the steps out of this lockdown. I stress that these restrictions are time limited: after four weeks, on Wednesday 2 December, they will expire, and we will return to a tiered system on a local and regional basis according to the latest data and trends. As the Prime Minister set out in the other place, the best way to get R down now is to beat this autumn surge and use the breathing space to exploit the medical and technical advantages we are making to keep it low.
Our doctors and scientists have led the way in improving how we treat people with Covid, work continues to progress on developing a vaccine and we are working to continue to increase our testing capacity, most notably with cheap, reliable and rapid-turnaround tests with results in minutes. As the Prime Minister outlined, plans are already in place for the deployment of these quick-turnaround tests, which we will manufacture in this country and apply in an ever-growing number of situations to allow us to beat the disease.
By way of conclusion, I acknowledge that these measures are difficult for us all. There is not one of us who does not regard them with a heavy heart, but I know that the general public will continue to come together, as they always have done. Together, we can protect the NHS and the vulnerable, and save lives. We must place difficult but time-limited curbs on our freedom in the short term so that we ensure greater freedom and prosperity in the long term. If we act now to suppress the virus and support the economy, education and the NHS, we can restore those cherished freedoms more quickly and get closer to the lives that we all want to be living. We cannot do this with the virus growing exponentially so we must all make sacrifices now for the safety of all. It will not be easy, I know, but in a pandemic the effective steps are not always easy. We are called on to make fundamental changes to how we work, live and interact with each other, in pursuit of a common cause. I beg to move.
Amendment to the Motion
Leave out from “That” to the end and insert “this House declines to approve the draft Regulations because no impact analysis of the social, economic and health costs of a national lockdown, compared to the benefits of addressing the transmission of COVID-19 of such a lockdown, has been laid before Parliament, and because Her Majesty’s Government have not published a comprehensive long-term strategy for the lifting of all the restrictions put in place to address the pandemic.”
My Lords, I declare an interest in that I am 69 and am definitely entering the danger zone for coronavirus. Actually, I believe I had it in late March after lockdown. It was largely asymptomatic and possibly acquired here in this House. I appreciate that my noble friend the Minister and the Government are in an impossibly difficult position. Nobody doubts that this is an unpleasant, virulent and highly contagious virus that is killing people, especially the old and vulnerable. Beyond that, there is huge disagreement among the public, politicians and scientists.
This morning, I attended a meeting with Sir Jeremy Farrar of SAGE. He was very reasonable, plausible and balanced but not ultimately convincing because of differing and competing views. For instance, Professor Heneghan, of the Oxford Centre for Evidence-Based Medicine—I emphasise “evidence-based”—said that the R rate in Liverpool is falling among the over-60s. Apparently, Covid cases in Liverpool hospitals are falling. King’s College London believes that the R rate in England and Wales now is approximately one and Tim Spector, a professor of epidemiology at King’s, thinks that the peak of the second wave has passed. Professor Gupta at Oxford and many other eminent scientists disagree with the SAGE analysis. We were told on Saturday by Sir Patrick Vallance of a trajectory of 4,000 deaths each day without a lockdown and yesterday, the Chief Medical Officer, under questioning, reduced that number to 1,000.
What I am saying is that nobody really knows, and scientists and doctors disagree. For instance, just over 1 million people have officially had Covid but I think that there are very many more. I suspect that all of us know people who believe that they have had it. We do not know how many cases are hospital-acquired infections; yesterday, Jeremy Hunt said that it is 18%. We do not know when and if a viable and effective vaccine will be produced. We still do not know why people have such totally different responses and symptoms. My son had the virus before the lockdown in mid-March. He recovered but said that he could not taste or smell anything. That was not declared a symptom until late May. This morning, Professor Farrar said that we still do not know much about the long-term effects—so-called long Covid. Of course, respiratory diseases such as pneumonia have a lingering effect that sometimes takes six months or more to recover from. The truth is that nobody knows much about this virus or the epidemic.
However, we now know that one has only a 50% chance of survival if put on a ventilator. We were not told that in April during the panic to get more ventilators, so advice changes. We know that only something like 320 deaths from coronavirus, every one of which is a tragedy, have occurred among those aged under 60 without comorbidities. Among the under-40s, there has been a total of about 250 deaths from the virus during the epidemic, overwhelmingly of people who were already vulnerable with comorbidities.
We know that our young people—our children and our grandchildren—will be saddled with debt for decades, as my parent’s generation spent decades paying off debt from the Second World War. Will our children ever forgive us? We know that unemployment will rocket next year. We know that businesses, large and small, will be closed in their droves. In hospitality, pubs and restaurants will close their doors tonight and many will never reopen. We know that cancer treatment has ground to a halt for hundreds and thousands of patients. We know that domestic abuse and mental health issues have increased dramatically—as, it appears, have suicides. We know that students are locked into halls of residence, ruining their time at university; they are turned into criminals if they leave. They will then face a desolate employment landscape in which to find a job. Therefore, is it not reasonable to ask for a cost-benefit or risk analysis? Yesterday, Robert Jenrick, a Cabinet Minister for whom I have a high regard, said that there had been no impact assessment. Surely we should expect such an assessment before embarking on a serious act of national self-harm, yet the Government do not appear to have done one.
The second part of my amendment calls for an explanation of the Government’s comprehensive long-term strategy. In the last century, when I was in the Army, it was a given that one explained to all one’s soldiers the rationale behind orders if one expected them to follow them. It is called leadership. I ask the Minister to tell the House what the strategy is behind government policy. The country is locked down so infections should fall, but when restrictions are lifted, it seems to me that infections may rise again, meaning a third wave. Then what? An effective and reliable vaccine may appear, or it may not. It may be only 50% reliable anyway, as I read from another expert. As I understand it, a vaccine makes the patient’s body produce antibodies, but now we are told that many recovered patients lose their antibodies within six months. Is that the case?
As a loyal Conservative, I want to believe that the Government have a strategy but my credulity has been strained somewhat. We were originally told, until late August, that face masks were essentially of no use. We have been told to go back to work. It is only two or three weeks since we were told that there would definitely not be a second national lockdown. I regret to say that an enormous amount of good will and trust has evaporated. We are told that the public support a second lockdown. I am not so sure, but the role of leadership is to lead. We need courageous leadership to explain the costs, benefits and risks surrounding this crisis and this measure. We need to a clear strategy to take us through this crisis.
I do not underestimate the extraordinarily difficult choices before the Government; nor do I envy Ministers having to make these decisions. I will listen to the 50 or more contributions and look forward to the Minister’s response, but I currently intend to divide the House on this amendment.
My Lords, on 13 October, I asked the Minister why the Government were so resistant to following the SAGE advice of 21 September. I said that I could see us back here in this Chamber debating a national lockdown within weeks, during which time more lives would have been lost. I have never been less gratified at having been right, like so many other people. If this Government reject hindsight, they have certainly failed at foresight.
Yesterday, in response to questions from my noble friends asking why the Government have chosen now to commit to a national lockdown, the Leader of the House said:
“We were presented with national data that we could not ignore.”—[Official Report, 3/11/20; col. 682.]
Can the Minister tell me why, having been presented with evidence that they could not ignore in September about exponential rates of infection, the Government chose to do just that? What evidence were they acting on? SAGE was clear that national measures were needed and was clear about the urgent need for more rapid, more stringent interventions that would more quickly reduce incidents, prevalence and Covid-19-related deaths.
Since the start of this epidemic, we have known that a second wave of infections this winter was probable. We in this House have asked constantly what evidence was being used to assess risk and what had been learned from the first wave about preventing the spread of infection. We asked what was being done to prevent spillover from areas of high to low infection. We asked time and again what was being done to support local authorities and correct for the diverse failures of the test and trace system. Over the months, we have had no answers; there were none because it was just drift and dither and now a bit of panic. It is no wonder that, even now, with a reluctant lockdown that is subtly different from the first, there is still a sea of confusion and deep anger across the country. No one underestimates the seriousness of what the Government are asking people to do or the impact that the next month will have on mental health, jobs, family and social life. I welcome the fact that schools are being kept open but it needs extra vigilance.
In a spirit of hope over experience, therefore, I shall ask the Minister some more questions. What is the current state of intensive-care hospital capacity in the south-east, where, like the south-west, the virus is rising faster? When will those beds be full? What range of criteria will be used to determine when the lockdown can be lifted on 2 December? People want certainty that it will end but if they are expected to comply, they want to know the plan and what it is based on. People also want to believe in the prospect of a vaccine, so can the Minister tell me what steps the Government are taking on all current vaccine candidates to license production in the UK to ensure that a supply is assured, regardless of which is approved? Who will get priority?
Finally, people want to be able to trust the scientific consensus and to know that the Government do too. But the Government have undermined that trust through their inconsistency, which has fuelled the scepticism that we see in this evening’s amendments expressing regret. Therefore, I agree with the noble Lord, Lord Robathan, in this respect: the management of the epidemic is an object lesson in the failure of leadership, governance, management and communication. However, I am sure that the House will support the regulations.
My Lords, in September 500 people were in hospital with Covid-related symptoms. Today, as we speak, the figure is nearly 11,000. If the Government had taken the advice of SAGE at the beginning of September, the number would clearly have been lower.
The effect on the NHS of having 11,000 Covid patients is not just a crisis in critical care for Covid patients; it is a crisis for anybody who has a life-threatening condition. Beds are filling up and, if this rate continues, people with life-threatening conditions will not be able to get the life-saving treatment they need in the NHS. That is why we need to act. I have some sympathy with some of the amendments that have been tabled but, because of that one fact, I cannot support them today. It is beholden on us to act, not just because of those with Covid but because of those who will have strokes, heart attacks and other life-threatening conditions now that we have got to this stage. I blame the Government for getting to this stage by not acting faster, but that one statistic alone makes me feel that we have to act.
We then have four weeks in which the Government have to put in place a national system for sorting out test, trace and isolate. On testing, it is not just a case of putting another two or three noughts on the number of tests carried out; it is about getting to the right people at the right time and getting the test back speedily. That is absolutely vital. The Government need to make sure that they stop talking just about quantity and start talking about quality as well.
Tracing is a national disgrace and is causing the virus to spread faster. We need to localise the tracing system, with local knowledge and shoe-leather epidemiology. We need people who know the streets, back doors and ginnels, and who know where to get to and how to speak to people. The Government need to localise by working with industry, academia and local government. It has to be about not just money but expertise, getting the data in a way that local areas require. That is absolutely vital.
Isolating is about giving people financial security so that they do not have to worry about feeding their children or paying their mortgage or rent. It should be seen as a national and civic duty which the Government support, without more sticks or penalties. Taiwan has shown how this can be done: with Covid teams which go in and support people, not just financially but with psychological help. There is help with childcare and food, and by checking on people’s health.
So, through gritted teeth, I will support these regulations. We, the public, will do our bit. We will stay at home, protect the NHS and save lives, but over the next four weeks the Government have to do their bit—sorting out the test, trace and isolate system.
My Lords, I am grateful to Her Majesty’s Government for seeking to ensure that the appropriate measures are in place to protect the most vulnerable and restrict the spread of this virus. It is important that we do not prolong such stringent lockdown measures because of the way that they impact on the mental, physical and, indeed, spiritual well-being of the population. However, I will not be supporting the fatal Motion. I recognise the exceptional nature of these times, and welcome that the regulations will enable places of worship to remain open for private prayer and broadcasting acts of worship. Creating such broadcast acts of worship often requires a team of people, both amateurs and professionals. I would welcome more clarity from the Minister on the number of people allowed to do this.
Clergy across the country have worked hard to ensure that our church buildings are Covid-secure for public worship, education settings, food banks and other essential services. In most places, by distancing and limiting congregation sizes, communal worship can safely take place without the need for an outright ban. Religious worship is not a leisure activity: the freedom to worship and to assemble for this purpose is a right that we enjoy in this country and strongly advocate for in other countries. The law will be adhered to, but I hope that the Prime Minister and the Government have understood from the united response of faith leaders yesterday that legal and safe acts of public worship are not things to be switched on and off by government regulation. Many have already asked this, but I will reiterate: can the Minister commit to providing the scientific evidence to justify such a suspension? The impact of this suspension will be felt publicly.
On Remembrance Sunday, a day in the year that is hugely significant for so many veterans and their families and for the whole country, our commemoration services will now be severely limited. Furthermore, over the next few weeks, important religious festivals for Hindus, Sikhs, Jains and the Jewish community will be disrupted by the lack of access to communal worship. I regret this. Faith groups serve the needs of their local communities, and clergy and healthcare chaplains provide significant support for the mental, social and spiritual well-being of the nation. Public worship is essential for spiritual and mental well-being, and a source of strength to many. It is not an optional extra for the Christian faith: our weekly worship services are part of a whole way of life. The importance of this must not go unrecognised. It is in drawing on their Christian faith and in the hope that Christmas brings that the Archbishops say in their letter to the nation today that it would help the whole nation if we adopted a “calm, courageous and compassionate” response to this trial.
My Lords, all the trade-offs that the Government have to make during this pandemic are unwelcome: trade-offs between our health, our prosperity, our freedom, our future and our happiness. We would all like to maintain them all, but the rise in numbers makes a lockdown unavoidable. Noble Lords should watch Fergus Walsh’s measured and harrowing report on Monday’s “BBC News at Ten”, from the Royal Liverpool Hospital in my home city, if they need human citation to bring the stats to life.
On the eve of our second lockdown in England, however, I ask the Minister what will come after. We all pray that new vaccines and improving treatments will gradually restore normality, but what if they do not? Is there active contingency planning in government on pessimistic, as well as optimistic, assumptions for the moment when this second lockdown is lifted? How can we avoid turning a new period of relative freedom into a third wave where—in the nightmare scenario—we tumble on in this way for years, always fearing the grim reaper at the door or in the supermarket queue, while becoming significantly poorer and ever more disunited in the process?
I hope that the Government are investigating in careful detail exactly what went wrong when the first lockdown was lifted. What were the primary drivers of rising infection? Who obeyed and who ignored the guidance, whether in workplaces, social or family settings? Did those reached by test and trace quarantine when asked to? Which sanctions worked and which failed to bite? Next time, how can we better persuade every section of society that the Government do not give you the virus but other people do; and that, absent a vaccine, we have no hope of achieving a modicum of normality until we stop transmitting this dread virus to one another? In conclusion, are the Government preparing now to ensure that this will be not just our second but our last lockdown?
My Lords, these regulations will bring misery to the lives of millions of our fellow citizens. We know now what lockdowns do from our experience in the spring and from that of other countries which took the same course.
Jobs are destroyed and perfectly good businesses are forced to close their doors for the last time. Anxiety, depression, mental illness, suicides and domestic abuse increase, as the noble Baroness, Lady Andrews, pointed out. Lives are lost as screening programmes are disrupted and people are fearful of going to hospital. Young people’s education is disrupted, their employment prospects blighted and their career paths distorted. The elderly are separated from their families and grandchildren as they ponder their own mortality. There is a cruelty here too, in cutting off folk in nursing homes from family visits, banning weddings and denying people the comfort of religious observance and the chance to join immediate families to mourn the passing of friends and relatives.
Tax revenues evaporate, and we add to the burden of our children a legacy of eye-watering debt. The deficit is now heading to £400 billion and probably on to half a trillion. Parliamentary democracy is a casualty too, as most of us in this debate get three minutes to speak, late at night, on the merits of nothing less than the shutting down of the entire economy and these extraordinary assaults on our liberty and prosperity. Who would have thought Ministers and officials would start telling people whom they can sleep with? The decisions are taken by folk in secure public sector employment, with inflation-proof pensions and good salaries. The highest price is paid by the poorest and those whose livelihoods depend on enterprise and the ability to make a profit. Lockdowns are the midwives of inequality.
Occasionally you see signs in shops saying, “If you break it, you pay for it”. I believe this applies to the Government today. It is irresponsible to present these regulations to Parliament without having done any analysis of the costs and means for mitigating all the consequences of their actions. I am grateful to Julia Hartley-Brewer of talkRADIO for succeeding where I failed through parliamentary questions in getting an answer from my right honourable friend Robert Jenrick MP, who told her it was unfair to ask whether the Government had done a cost-benefit analysis of the consequences of lockdown. After very robust interrogation, he admitted that he had not seen one, because it did not exist.
Again and again, Ministers rightly say they have to balance lives against livelihoods, but to achieve balance you need to weigh both sides of the scale. We are told that the models say we have no alternative, as the NHS will be overwhelmed. We of course have a duty to take this very seriously, but the Explanatory Memorandum for these regulations says the Government are assuming an R rate of 1.1 to 1.3. Professor Tim Spector from King’s College has suggested that R is now one in England and the UK as a whole, and Professor Heneghan from Oxford University says the infection rate in Liverpool is falling from a run rate of 490 a day over seven days to 269 and the R value is well below one, a point that the noble Lord, Lord Birt, may not have noticed. It seems the Government’s tiered approach is not only hurting but working.
The last financial crisis was caused by groupthink and people believing models which told them they could convert lead into gold at the expense of common sense. Then, the poorest paid the price, and those responsible became very rich. The fact that we were all scared by headlines over the weekend telling us that 4,000 people a day would die, and learned within hours that this came from a discredited model which predicted four times as many deaths as occurred in real life on 1 November, is worrying to say the least. With all models, the rule is very simple: garbage in, garbage out.
We also know that, once implemented, lockdowns are hard to exit. On Saturday the Prime Minister told us it would be for a strictly limited period, until 2 December. In less than 24 hours, Michael Gove was telling Andrew Marr it could be extended. When asked about this yesterday, Professor Whitty said:
“I think that the aim of this is to get the rates down far enough that it’s a realistic possibility to move into a different state of play at that point in time.”
What are people running businesses meant to do? Do they listen to the PM and take on more debt to survive another month if they can, or do they conclude, after listening to Mr Gove and Professor Whitty, that they should throw in the towel?
The Chancellor has done brilliantly, but he knows we are heading for Carey Street. What will this lockdown cost—perhaps £12.5 billion for furlough and the self-employed alone? He will need to extend the £20 a week standard allowance for universal credit from April. When folk who thought they were in secure jobs—say, on £25,000 a year—discover that they are not eligible for universal credit because they have savings or a working partner, his colleagues in the Commons with be inundated with constituents worried about how to pay their bills and feed their families. Where will he find the money for health, welfare and social care, and for the job creation initiatives that will be needed? To paraphrase Tacitus, we will have created a desert and called it protecting the health service.
My Lords, at Prime Minister’s Questions today, the Prime Minister refused on more than one occasion to say what the Government are going to do with the time the next four weeks gives them. Can the Minister, in winding up, tell us, please?
Will a system for visitors to care homes be implemented? It should be really simple to designate one family member as a key visitor who can be tested like care workers. Will the Serco test and trace be fixed and then handed on to local authorities? The clinical director of the NHS, in his Q&A this afternoon, made it crystal clear that it is not an NHS test and trace.
We have lost a lot of time since the SAGE advice on 21 September. The tier system was not working as planned, so we now have lockdown longer and harder as a result. How can this be avoided again in the future? This is the second lockdown, later than it should have been to be effective and save lives. Surely, we cannot contemplate a third time—so what is the strategy to avoid this?
There are some 11,000 people today in hospital with Covid. We need these regulations to keep within capacity and so keep elective services going, unlike in the spring. I understand that the capacity for Covid is about 20,000, and it reached 17,000 in the spring. That still allows us to do other work, which is absolutely crucial. But compared to many OECD countries, our health capacity is not that good, measured by population against doctors, nurses, beds and intensive care units—and that is before we get to equipment such as scanners. Is anybody in government thinking about increasing our overall capacity?
My final point is that almost exactly a year ago, without warning or planning, I occupied an intensive care unit bed for two weeks while the NHS worked to stop me going over to the dark side. This was followed by another three weeks in the hands of the NHS. I want anybody in the same position as I found myself in to have the same chances of the NHS helping and saving them. This will not happen if Covid gets completely out of control and all the beds are taken. For that reason—to keep within our capacity—I have no hesitation in supporting these regulations.
My Lords, it is pleasing to note that today’s regulations make no reference to avoiding the use of public transport, I hope at least in part as an acknowledgement of the huge effort made by operators and staff to keep people safe.
However, it is another public health issue of serious proportions that I wish to draw to the attention of the House this evening: the rapidly rising congestion of and pollution from our road system, which, of course, is again making operating a reliable bus service very difficult. A sensible Government would be alive to the issue. Yet we see oil prices falling, when a more prudent Chancellor might have raised fuel taxes to help repair the huge budget deficit, and the pouring on to our roads of many more large sports utility vehicles, which emit more pollution and take up more road space.
Time is not on our side if we are to make meaningful efforts to tackle this country’s pollution problems. While coronavirus is the immediate priority, I hope that someone in government—the Minister is a health spokesman—has plans to deal with the problems of congestion and pollution.
Climate change will not go away. Next year the eyes of the world will be fixed on us again when we host the climate change talks in Glasgow.
My Lords, my amendment is about the evidence for the lockdown in the order before us. The Government have no easy task in finding the optimal policy responses to the virus. They deserve the best advice they can get, but I am not sure they are getting it.
I hope that at least some noble Lords have read the book published earlier this year by the noble Lord, Lord King of Lothbury, and John Kay, entitled Radical Uncertainty. It warns of excessive reliance on probabilistic reasoning and modelling. Its core insight is that we need to face not knowing the answers when confronted with massive uncertainty. Instead people should stand back and ask themselves, “What is going on here?”. If that had been the focus of policy discussions, I do not believe this destructive lockdown would have been the solution.
On Monday, my right honourable friend the Prime Minister said in the other place that the data now suggest that our health system will be overwhelmed. The so-called data on which he was relying were not facts but modelled numbers. Modelled outcomes are only as good as their base data and assumptions.
As we have heard, last weekend the Chief Scientific Adviser showed a slide that suggested a scenario of 4,000 deaths per day in December. According to that chart, there should have been 1,000 daily deaths last weekend. There were fewer than 300. Four thousand deaths per day is virtually impossible, even using SAGE’s inflated infection fatality rate of 0.7%, and implies that around 600,000 people will be infected every day next week. None of the data points that we have on infection levels come anywhere close to that.
The adviser then showed something called the SPIM—medium-term projections of hospital admissions, deaths and NHS bed usage. These indicated bed demand later this month apparently shooting way ahead of the March-April peak and ahead of the assumption that only about 20% of NHS beds can be used for coronavirus patients. However, the detailed modelling assumptions have not been made public. Instead, the small print says that this is a consensus forecast, based on several models, none of which assumptions has been made public. Does that sound like a good basis for a momentous decision to close the country down?
We learned yesterday from evidence given to the Science and Technology Committee in the other place that these models were based on earlier, not up-to-date, data. The assumptions took no account of the recently introduced tier system, despite those areas already showing reduced infection rates and hospital admissions. Leaked NHS data show that, despite a few local hotspots, intensive care bed capacity is around normal for this time of year.
Some have suggested that those scenarios and forecasts were deliberately calibrated to produce the maximum fear in the general public and thereby generate support for another national lockdown. The Daily Mail has also called out the way in which last Saturday’s presentation cherry-picked data and presented it in a way that would make even Liberal Democrats blush. Is this all a deliberate plot to provide cover for the curtailment of our liberties? I could not possibly comment. However, I know that the Government should be alert to dangers of groupthink and the self-reinforcing nature of scientific cliques. The history of science is littered with views, such as whether the earth is flat, that remained widely held beliefs long after clear evidence to the contrary emerged.
There is no independent challenge to the SAGE analysis. There ought to be a place for techniques such as red teaming that robustly challenge house views. There certainly are scientists out there, for example in the Oxford Centre for Evidence-Based Medicine, who could provide that challenge. Was anyone asking, “What is going on here?” I do not think so. Otherwise, they would have compared infection rates and R numbers in the models with the latest data points and would have noticed that the models use R numbers that are ahead of current numbers, even though the R numbers from the ONS data have been falling. As we heard, the Liverpool R number is already below 1. The Prime Minister said several times in the other place on Monday that an R number of 1 or less was the aim of the lockdown. As we have heard, the latest ZOE survey data show that infections are past their peak and the R rate is already at the magic number, 1.
If the Government had sought independent challenge, they might well have concluded that this heartless order was unnecessary and, as a minimum, dialled back their scary charts. The Prime Minister cares sincerely about civil liberties but I suspect that he has more of a way with words than numbers and is in thrall to a tightly knit group of scientists with a single world view. It is time for him to ask, “What is going on here?”, and take back control of the coronavirus agenda.