To ask His Majesty’s Government on the basis of what health evidence, if any, they have postponed the planned ban on two-for-one offers for foods high in fat, salt and sugar.

The volume price promotion restrictions have been delayed for two years while we prioritise the implementation of the location restrictions. This is the most impactful policy for reducing children’s calorie consumption, and accounts for 96% of the expected health benefits of the promotions policy. Kantar data suggests that it is working. The evidence suggests that this will have the biggest impact on tackling obesity.

I thank the Minister for his reply, but according to the Food Foundation’s most recent Broken Plate report, the most deprived 20% of families would have to spend half of their disposable income on food to comply with the Government’s healthy diet advice. Bearing that in mind, why are the Government continuing to allow retailers to sell HFSS foods, which can make people ill, at a discount? Do the government really want to encourage people to buy cheap food that could, in the end, kill them?

First, I thank the noble Baroness for her tireless work in this space. I think we have shown that our restrictions are absolutely placed to inform and educate people so that they can have a healthy diet. I mentioned what we have done on location—the so-called pester power avoidance. It is estimated that these measures will reduce calorific intake by 96%. That is the prize that we are looking at here.

My Lords, can the Minister confirm that the Secretary of State for Health actually believes in public health policy, because his recent speech at the Centre for Policy Studies—I watched all of it—indicates he does not?

He definitely does. He was very much behind these measures. Just look at what we are doing in the smoking space, through the swapping out of cigarettes for vapes—another example of where we are taking action. As I mentioned, the evidence from Kantar suggests that it is working.

My Lords, if a product is marketed legally in the United Kingdom, why should His Majesty’s Government feel they have to interfere at all with the marketing of that product? I understand the point about education and totally accept it, but is it not wrong for His Majesty’s Government to restrict what is a legally marketed product?

We are trying to educate, inform and nudge. The best example of all is encouraging the industry to reformulate its foods to be healthier. At this point, I am glad to say that, since we introduced these restrictions, Mars, Galaxy, Bounty and Snickers have reformulated, and even Mr Kipling’s Deliciously Good cakes are compliant.

My Lords, next week it will be three years since the Government committed to legislate to end the promotion of high-fat, salt and sugar foods by volume. Would a reasonable person think that this commitment has been met when the legislation has been passed but not implemented, and will not be for another couple of years?

As I mentioned, the key is giving industry time to adjust so that it can reformulate. We would all agree that, if you can get the same taste but it is a lot healthier, with less fat, salt and sugar, that must be a good outcome. The examples that I just gave show that, and it is working.

The NHS Food Scanner is promoting to children a number of ultra-processed food items. Do the Government not think that this is quite perverse given the new knowledge about what exactly ultra-processed food means? It is not just about the sugars, salts and fat but about the chemical destruction and reformulation of foodstuffs into something else.

As I mentioned in answer to a Question on ultra-processed food yesterday, as a definition that is not particularly helpful because wholemeal bread, baked beans and cereals are all examples of ultra-processed food. The real point is the content of the food, and that is what our regulations should look to.

My Lords, when the anti-obesity strategy was published, this ban was said to be supporting food affordability, citing evidence that multi-buy offers such as “buy one, get one free” increase the amount that people spend on foods by around 20% but often on foods high in fat, sugar and salt. With the Government now making the opposite argument to support this postponement, do they no longer stand by the evidence? Would a ban on these deals make it easier or harder for those who are struggling to get by?

As we have mentioned before, our general direction of travel is to educate, reformulate and give people the best chances through having choices, and a good start in life through the fresh fruit and vegetables that we have in schools. Those are the things that will really make the difference.

Does my noble friend the Minister recall, on that exact point about access to fresh fruit and vegetables, the very successful scheme that we pioneered about 12 years ago with the Association of Convenience Stores so that corner shops would carry fresh fruit and vegetables close to the till and make them accessible, with us carrying the risk of wastage? That led to a significant increase in corner shops selling fresh fruit and vegetables.

To me, that is a great example of how working in co-operation to allow people to make the right choices is the best way. For instance, 78% of shoppers have said that they are in favour of not having unhealthy items at the till because they know that they give in to pester power. That is why this has been focus of what we have done.

My Lords, notwithstanding the interesting “legal but harmful” point made by the noble Lord, Lord Naseby, I think that most of the House would agree that reducing high-fat, sugar and salt content is a good idea. However, the Minister has at least twice mentioned reduction of calories. Does he acknowledge and recognise that while one way to address obesity is calorie reduction, it is not an appropriate message for everybody and it certainly is not the sole cause of obesity across this country?

The noble Baroness is correct; this is a complicated area, and a number of measures need to be taken. The best thing is the promotion of healthy foods, and the fresh fruit and veg initiatives that we have talked about today are perfect examples of that.

My Lords, some years ago, the British-Irish Parliamentary Assembly looked at obesity in children, during the course of which we went to Amsterdam to look at what was going on there. Two of the things that were very enlightening were educating children in schools and educating pregnant mothers. What about that?

I am aware of the Amsterdam initiative. Off the back of that, the OECD said that there were four main strands to what countries should be doing: first, information and education, such as the good examples I spoke about; secondly, increasing healthy choices through the reformulation of foods, which again is something we are doing; thirdly, the modifying of costs—the sugar tax, which has reduced sugar consumption by as much as 40%, is a perfect example of that; and, fourthly, restrictions on where product placement should take place. I am absolutely familiar with the initiative in Amsterdam, and am pleased to see that we have taken action on a lot of those things.

Is the Minister not ashamed about what has happened to children’s health while the Conservatives have been in power since 2010? We have more obese children than ever before, and a plethora of policies which would work if implemented, yet so many are delayed. Will the Minister give a commitment to go back and look at the regulations governing children’s school meals? They were changed in 2014, with permission granted to give children more sugar. The Government were reviewing this in 2019 and 2020, but that stopped because of Covid. Will the Minister give a commitment again to start a review? Even if they cannot implement it, the next Government could.

The noble Lord is correct: good school meals are fundamental to all of this. My understanding is that the review is something that the Government are looking to do, but I will happily provide more details on what the plan is.

My Lords, can I just test with the Minister whether there is still a commitment to the policy of banning two-for-one promotions? If there is, is there an effective deal going on with the food producers that they will change certain processes if this ban continues to be pushed backwards and effectively talked out of effect?

There is absolutely the commitment for October 2025. The tactic behind that is to give industry the time to make its food healthier. That is exactly what it is doing in the examples I mentioned, including the Deliciously Good cakes. It is good to see industry respond in that way.

To ask His Majesty’s Government when they expect to publish the report of the independent review, chaired by Lord Etherton, into the impact on military veterans of the pre-2000 ban on homosexuality in the armed forces, along with their response to the report.

The Government have today published the report of the noble and learned Lord, Lord Etherton, and accepted in principle the vast majority of the recommendations. As the Defence Secretary set out, while we agree with the intent behind them, there are a number which we will deliver in a slightly different way from that described in the report. We will set out these differences when we publish the Government’s full response to the review after the Summer Recess. Earlier today in the other place, my right honourable friends the Prime Minister and the Secretary of State for Defence apologised. Today in this House I repeat those apologies. From this Dispatch Box, I apologise on behalf of the Government and the Armed Forces, and I am profoundly sorry for all that our LGBT personnel suffered.

My Lords, is it not an interesting coincidence that this Question should come up on the very day that the Government finally published the excellent and long-awaited report of the noble and learned Lord, Lord Etherton? Could it possibly be that my little Question, tabled a month ago, helped in some small way to end the delay in releasing this report—so meticulously prepared by the noble and learned Lord, Lord Etherton, and delivered to the Government in May, bang on time—which had distressed many LGBT veterans? I hope that the Statement delivered in the Commons by the Secretary of State for Defence earlier today will be repeated in your Lordships’ House before the Recess. Finally, does not the full apology delivered by our Prime Minister today set the scene quite admirably for the substantial reparation that must be made to LGBT veterans who served their country with devotion, only to have their lives ruined because of their sexuality?

I much respect the views being expressed by my noble friend. An eminent theologian once said to me that anyone who believes in coincidences must lead a very boring life and I could never accuse my noble friend of that. He makes an important point. There was a desire to bring the report forward and to publish it and I absolutely accept that my noble friend’s Question has been most timely in respect of this Chamber. On the matter of further procedure within the Chamber, he will understand that that is for others—my noble friends the Leader and the Chief Whip, with their counterparts through the usual channels—to determine. However, I am confident that, as the Secretary of State indicated in the other place, this Chamber will want to debate this report and I take this opportunity to pay tribute to the noble and learned Lord, Lord Etherton, for a forensic and meticulously comprehensive report. It is a most informative, extremely disturbing and, at times, appallingly repugnant read. It has shone light where light needed to be shone—there is not a shadow of a doubt—and we are all indebted to the noble and learned Lord for his assiduous work and his contribution to this vital issue.

My Lords, I too commend this report and congratulate the noble and learned Lord on what, as the Minister has said, is a deeply harrowing yet forensic report. I think it will put right the wrongs that have been done to LGBT service personnel across the generations. I pay tribute to Elaine Chambers and Robert Ely, who set up Rank Outsiders in the early 1990s, which campaigned to end the ban on gays serving in the military. Will the Minister consider setting up an active task force to ensure that the 49 recommendations across government departments are brought forward, not least on service records, pensions and compensation? Further delay will only cause deeper tragedy.

I thank the noble Lord for his kind remarks, and I think there was a lot of sympathy across the Chamber with what he said. I would observe that, as the Secretary of State was explicit about today in the other place, we are going to look comprehensively at the recommendations but we need to do that in conjunction with organisations such as that to which the noble Lord referred; and I pay tribute to them. They were indeed the founders of the pressure to ensure that at some point this was all laid open, exposed and examined and they deserve credit for their persistence. My right honourable friend the Secretary of State said in the other place that we will work extensively over the summer in consultation with all those who have an interest in this. We want to get it right and ensure that the recommendations so appropriately articulated by the noble and learned Lord get due consideration and we all understand what the consequences are and what the best route for delivery may be. My right honourable friend the Secretary of State said we accept the spirit of the recommendations and I repeat that in this Chamber.

My Lords, speaking in the other place, the Secretary of State assumed that Members would have had a chance to read the testimonials. Unless people have done a speed-reading course, I suspect that so far we have not been able to do that. The Secretary of State also said that the Government have implemented six of the 49 recommendations already, without stipulating what they were, other than the apology. Can the Minister elaborate? Can she say also whether there will be an apology to the families of those LGBT veterans who are no longer with us but whose lives were blighted by the ban and whose families were therefore affected?

I can say to the noble Baroness that already we have taken proactive measures such as implementing various inclusive policies—that was important —including the provision of pre-exposure HIV prophylaxis. We have introduced a guide for parents of LGBT children and LGBT+ allies training. We have several thriving LGBT+ staff networks and a LGBT+ community which regularly parades in Fighting with Pride marches and does so with pride. I had the privilege of meeting them at a reception last year and my right honourable friend the Minister for Defence, People, Veterans and Service Families was with them this year. In addition, we have today launched an “LGBT veterans: support and next steps” GOV.UK page, which is now live and available for anyone who was impacted by the policy to explore the support, services and restorative measures available to veterans. The recommendations also specifically provided for apologies, which we acknowledge as being absolutely necessary. In relation to the successors and relatives of those who have died, I think the apologies of the Prime Minister and the Secretary of State for Defence were all-encompassing. The Prime Minister’s was on behalf of the British state to all affected.

Does the Minister agree that my noble and learned friend’s report should be seen as a paradigm across other sectors in both the public sector and the private sector; for example, in banking, where there is still discrimination on the grounds of sexual orientation, often fairly covert?

I agree with the noble Lord. I think “paradigm” is a very appropriate noun to attribute to the noble and learned Lord’s report. I am disturbed to hear that there are other areas and sectors where such behaviour is lurking. My advice to anybody in those sectors is to call it out, expose it, shine a light on it and make sure that the miscreants, transgressors and culprits are all put into public view and dealt with appropriately.

My Lords, I congratulate the noble Lord, Lord Lexden, on his Question and the noble and learned Lord, Lord Etherton, on his report, which I have managed to look at. I am sorry that I have not yet read it. It was good to hear the Minister’s apology on behalf of the nation, as well as the apologies of the Prime Minister and the Defence Secretary. I think all of us would wish to join in that apology. It is important for us in the remarks that we make today to pay tribute to those who have had the bravery to come forward and share their testimonies with us. For those who have not read the report, it is horrific, with unscientific methods of investigation into individuals, prejudice, discrimination, bullying and harassment, and Armed Forces personnel having their medals, which were often given for gallantry, taken away. It is an appalling saga, and let us hope that the recommendations are implemented quickly and that we can move forward out of this horror and ensure that in today’s Armed Forces none of that prejudice exists.

I associate myself with everything the noble Lord has said. I was struck by part of the narrative. At page 53 of the report, the noble and learned Lord wrote:

“In broad terms, the responses to the Call for Evidence paint a vivid picture of overt homophobia at all levels of the armed forces during the period 1967 to 2000 and of the bullying that inevitably reflected it”.

The noble Lord is correct that some of the testimonies are absolutely nauseating and reveal treatment and behaviour that are beyond belief. The noble Lord is absolutely correct that to have the courage to come forward—it is obvious from the report how many people did come forward—was an extraordinary commitment and demonstration of bravery, and I cannot congratulate, commend or thank them too much because without their evidence, despite all the best efforts of the noble and learned Lord, this report would perhaps lack the impact and the undeniable punch which it has had.

To ask His Majesty’s Government what assessment they have made of the impact of the oil and gas windfall tax on investment and jobs, and the capacity of the energy sector and supply chain to deliver key components of the transition for achieving the United Kingdom’s net zero objectives.

My Lords, the Government introduced the energy profits levy to respond to exceptionally high prices that mean that oil and gas companies are benefiting from extraordinary profits. The Government have been clear that we want to see producers reinvest profits to support the economy, jobs and the UK’s energy security, which is why we have introduced generous investment allowances. Our North Sea transition deal reflects the key role of the sector in that energy transition.

I thank the Minister for that reply. As we increase our efforts to meet net zero, which we clearly must, does he agree that through all the projections to and through net zero, we will continue to use fossil fuel, albeit on a declining basis? Therefore, is it not essential, because Norway has said that it will produce every ounce of oil and gas that is commercial in its sector, that we do nothing to prevent the transition being led by the energy industry, which is increasing its investment in the necessary technology such as carbon capture and storage, hydrogen and green electricity, and that we need to ensure that it can continue to do that?

I am very happy to agree with the noble Lord. I am tempted to observe that he might want to talk to some of his colleagues on his Benches about that message. He is right that it makes much more sense as we go through the transition to obtain those resources from our own fields rather than import them at a much higher carbon content.

My Lords, I refer to my interests in the register and to the previous questions I have raised on this matter in Treasury Questions. The point is that the EPL has had a dramatic effect on investment in North Sea oil. The question from the noble Lord, Lord Bruce, asks what assessment the Government have made of it. Would the Minister include in that assessment an analysis of the bids that have been made—for example, for Chevron oil in the Republic of Congo and in the Gulf of Mexico—by North Sea oil companies that are no longer investing in the North Sea?

My noble friend makes an important point. Taxation levels are obviously a matter for the Chancellor and the Treasury. However, there are a number of concerning stories from investors that they have pulled out of investments in the North Sea; in fact, one remarked that parts of Africa were a more stable tax environment.

My Lords, I congratulate the Government on the £20 billion they put into the small modular reactor enterprise, and the work they have done for the STEP fission reactor. Does the Minister agree that the best net-zero way of ensuring that we have energy to provide the electrical baseload is to press ahead rapidly with Hinkley C and Sizewell because, if we do not get this nuclear power online, we are not going to make it?

I do agree with the noble Lord. Nuclear reactors, whether it be Sizewell or Hinkley, and small modular reactors will play an important part in the net-zero transition. Of course, we want a diverse supply mix; we want as much renewable energy as possible, but nuclear will play an important role.

My Lords, does the Minister recognise that the Paris Agreement implies the use of much less oil and gas in the 2030s than now? Therefore, issuing permits for exploration that usually requires at least seven years to generate flows makes little sense, particularly as the effect on prices and security would be negligible. Does he recognise that issuing such permits is essentially enabling and fostering bets on climate failure?

No, I would not agree with the noble Lord, I am afraid; he is absolutely dead wrong. Even with any new licences that might be issued in the UK, UK production will continue to decline at the rate of about 7% a year. It is estimated that global production decline needs to be about 3% to 4% in order to ensure the net-zero transition, so we will be declining at a faster rate than what is required globally.

My Lords, the windfall tax that the Minister mentions taxes profits but also gives a substantial kickback on investment. On renewables, the levy is against revenue and there is no such kickback. When will the Department for Energy Security and Net Zero stop discriminating against renewables?

My Lords, what the noble Lord refers to as a “kickback” is actually an investment allowance. If I am right, the same noble Lord was asking me about reducing flaring and about introducing electrification of fields. It is those investment allowances that pay for the very policies that he asked me to introduce.

My Lords, in concurring with the noble Lord, Lord Bruce, in his statement that oil and gas are a vital part of transition to net zero, can I ask the Minister what the situation is with the Rosebank oil project, which is a world-class asset and one of the largest of its kind anywhere in the world?

I thank my noble friend for the kind invitation to respond to that. He will understand that I cannot comment on licensing decisions.

My Lords, analysis of the Office for Budget Responsibility data in May this year showed the extent to which oil and gas firms were able to reduce their energy profits levy while still making record profits. Between this loophole, the decision against a 78% rate and the decision not to backdate to catch all the surging profits, it is estimated that over £10 billion of potential tax will be missed between 2022-23 and 2023-24. I ask the Minister: have the Government given any consideration to fixing the levy to deliver the full benefits proposed since these figures came out?

I do not know where the noble Baroness gets her figures. I responded in my previous answer to the question about investment allowances—policies that the Opposition have called for. The energy profits levy is expected to raise about £26 billion and is set at a rate of 75%, which is one of the highest in the world. I realise that the Labour Party’s policy is to tax firms into extinction, but we need to leave them with some profits. Much of the profits of oil and gas companies goes towards pension funds and other shareholders which many pensioners and others rely on for their income.

My Lords, the IEA’s report World Energy Outlook 2022 is clear that the solution to the energy trilemma of economic, climate and security issues is to accelerate the move to greener energy. For us in the UK, among other things, that means urgently equipping our workforce with transferable skills for the energy transition. What are the Government doing to make sure that a single offshore energy skills passport that aligns training standards in all offshore energy sectors is introduced?

The noble Baroness is essentially right: of course we need to transition to renewable energy sources, and that is exactly what we are doing. The North Sea transition deal between the Government and North Sea companies is helping to move them, as far as the transition is going, to transfer their skills to many of the new industries. For example, many drilling companies operating in the North Sea also drill geothermal heat sources to use for renewable energy. The two things are not mutually incompatible.

My Lords, what assessment is the North Sea Transition Authority making of the alignment of company commitments, especially on net- zero targets covering scopes 1, 2 and 3, over the short, medium and long term as well as company alignment on capital expenditure towards those targets? Can the Minister assure us that, before licensing any expansion in North Sea exploration, the authority will factor this into consideration when judging projects under alignment with the UK’s net-zero legal commitment?

As I said in response to a previous question, I cannot comment on any licensing decisions—we will know about them before too long—but I can assure the right reverend Prelate that all the appropriate considerations are being taken into account by the Government and the North Sea Transition Authority on the issuing of those licences.

I agree 100% with the Government’s nuclear policy but, bearing in mind that we want the success of renewables and the end of oil and gas, what assessment has been made of the fact that by 2050—which is not that far away—when the oil and gas is gone, we will be relying on nuclear for intermittency? That will leave the nuclear situation as a stranded asset, because it really does not work that way; it has got to be a formal baseload. Once the rest has gone and we are on renewables and left with nuclear, how can it be intermittent?

I totally understand the point the noble Lord is making. He is right that many renewables are very cheap but intermittent, and nuclear will contribute towards the baseload. He is asking for long-term energy storage; the answer is hydrogen. We can store large quantities of hydrogen—some really exciting projects are coming forward—and it can then be burned, with no emissions, in a power station to provide the supplies that we will need when the wind is not blowing and the sun is not shining.

To ask His Majesty’s Government what assessment they have made of the conclusion of the report of the Lord Speaker’s Committee on the Size of the House that recent developments “have brought the appointments system into question”.

My Lords, of course, the Government will carefully note the report. Our view is that the life peerage system works well—

Oh!

There are certain beneficiaries of the life peerage system who seem to disagree.

We think that members of the House of Lords Appointments Commission do a good job and I have every confidence that new members coming in will do the same. To tweet this morning, as the noble Baroness did, about “ongoing corrupt patronage” from Prime Ministers does not help confidence in the appointments system.

I am very flattered that the noble Lord knows about my tweets. That is very nice. It is obvious that the system of prime ministerial patronage is not working. Various Prime Ministers over the past couple of years have clearly put people into your Lordships’ House who have no intention of contributing to our work and probably do not have the skills to do so anyway. This is not about the House of Lords Appointments Commission, which I admire very much. The Green Party believes that that system is archaic and corrupt. Does the Leader of the House agree with me even a tiny bit?

I very often agree with the noble Baroness, except I have never tweeted in my life, and I recommend her not to. The policy of the Green Party is to replace the system of appointment—which has given us all the excellent noble Lords here on these Benches in their parties—with a PR-democratically elected Chamber. Frankly, that would simply replace an accountable appointments system, where Prime Ministers are openly responsible for who they appoint, with an unaccountable appointments system of lists drawn up by secretive party secretariats.

My Lords—

My Lords—

My Lords, we have lots of time. Let us hear from the noble Lord, Lord Wallace, then we very much look forward to hearing from the noble Lord, Lord Grocott.

My Lords, when the last reform of the House took place between 1997 and 1999, the then Government stated clearly that, ad interim, it was the Government’s policy, agreed with the Conservative Opposition and the Leader of the Conservative Opposition in the Lords, that no party should have a disproportionate number of Peers in the Lords.

Oh!

I remind Conservative Peers that on a current poll basis the Conservatives have exactly twice the poll percentage of public support that we do, so we are not overrepresented.

Particularly under Boris Johnson, the Conservatives have broken that agreement. Do the Government not accept that we are now in a position where any change of government would have to be accompanied either by the voluntary resignation of a substantial number of Conservative Peers or the appointment of a large number of new governmental Peers, which would be bad for the size of the House?

My Lords, I think the question of “disproportionate” was answered by Members of your Lordships’ House rather than me, so I will not add to the pain of those Benches. I think that there needs to be—and I have advocated this publicly in the House and privately—better representation of His Majesty’s Opposition in your Lordships’ House. I do not think it is generally acceptable that His Majesty’s Opposition should have fewer representatives in this House than the Cross Benches. I recognise that, and for all the criticism of the previous Prime Minister, Mr Johnson, he approved the appointment of Labour Peers. I hope that will go forward.

My Lords, a part of this report that I particularly enjoyed was the piece saying that

“the ending of the hereditary peer by-elections … is crucial”.

There are two more of these wretched men-only by-elections pending as they stand. I appeal to the Leader, who talks about proportionality. It is his responsibility—and he knows the constitution well enough—not just to speak for his party but as Leader of the House to speak for the whole House. The whole House is absolutely clear by an overwhelming majority, repeatedly tested in votes on this issue, that hereditary Peer by-elections should end. I ask him to go to his colleagues in the Cabinet, tell them that there is no defence of this system whatever—I challenge him to provide one—and say that a simple two-clause Bill would scrap them, which would be consistent with the wishes of nearly everyone in this Chamber.

I think the Government have other legislative priorities. The noble Lord knows how highly I esteem him. He is a bit like the elder Cato, who ended every speech in the Roman Senate by saying that Carthage must be destroyed. Unfortunately, Romans later looked back and said that when Carthage was destroyed was perhaps the beginning of the end of Rome. I am sure that, one day, the hereditary peerage will—and that has been long accepted—depart this House. Many will be sad of that. When it does, the full gaze of the public will turn on the life peerage and how that, in its turn, will stand the test of time.

My Lords—

My Lords, overall numbers obviously matter, but so does the number of Members of your Lordships’ House with a diversity of lived experience. The greater ethnic diversity of the recent intakes of Members to your Lordships’ House obviously strengthens us hugely in the eyes of the public, but will my noble friend The Lord Privy Seal draw No. 10’s attention to the fact that, as compared with 20% of the population who are disabled, only 1% of your Lordships’ House has long-term lived experience of disability and encourage the Prime Minister to remedy that disproportionality?

My Lords, my noble friend makes a very important point. I certainly will pass on that message, as indeed others that I have referred to. I think the whole House looks with the most enormous admiration and respect at—and gains tremendously from the presence of—those who have the kind of lived experience that my noble friend refers to.

My Lords, the Leader said that the Government would take note of the report. Would he go rather further and look at it? It is cogent and carefully argued. If there is not time for legislation, there is time and opportunity for the Prime Minister to take action on issues that the public object to—not the work that this House does, but the size of the House and the method of appointment. The Prime Minister could limit the number of appointments and he could say that the Appointments Commission should look at the suitability and ability to contribute of Members who are nominated by the political parties, as it does for those who are nominated to the Cross Benches.

My Lords, on the size of the House, since January 2022 it has in fact grown by four—plus seven net Conservatives and plus three net Labour. I understand that many noble Lords are agitated about the size of the House. However, I sometimes wish that the House would concentrate on extolling the great and good things that your Lordships do every day and the challenge that your Lordships give to the Government to improve legislation, and not concentrate so much on running down the House. I am not accusing the noble Baroness of that, but the reality is that we have just had in this House one of the most contested pieces of legislation, where 417 Peers voted.

My Lords, the noble Lord will understand that this is the fifth report of the Lord Speaker’s Committee. I am sure he senses the huge exasperation that so little has changed since the first report. Those of us who value—and I concur with him on this point—the work of this House and believe that it matters are frustrated that the two most serious and justified complaints are ones that Members of this House can do absolutely nothing about. As outlined by the noble Baroness, Lady Hayman, the size of the House and the appointments system bring us into criticism. The work of this House, whether people agree or not with our decisions, does not receive criticism; it is often praised—it is the size of the House and the appointments system. We do not have to agree with everything in the Lord Speaker’s report to know that something has to change. There needs to be grown-up, cross-party, serious discussions on these two key issues. I am ready; are the Government?

My Lords, I wanted the noble Baroness to have time to intervene. I repeat with some humility the fact that I think we worry too much about the nominal size of the House. A House which has certain experts in it and people who come here occasionally and make a great contribution has to be larger than a full-time House. I repeat that we had 417 Peers voting on the deeply contested legislation on illegal migration on Monday. The House calls for a limit of 600 Members; we very rarely get that number voting.

As for discussions, the most important things are the role of the House, the way it conducts itself and, if I may say so, the agreements across the House within the usual channels. I am always keen to facilitate the House operating in a sensible mode. Size was not a problem in the late 1940s when the Labour Party was massively outnumbered, because there was an understanding about the way in which the House should operate. The House should concentrate on doing its role in that sort of way, and I am very happy to have those kinds of discussions. We should worry a little less about the nominal size of the House.

To ask His Majesty’s Government, in light of the recent assurances from the Economic Secretary to the Treasury, what action they intend to take to ensure that no person’s bank account should be closed for political reasons.

My Lords, I beg leave to ask a Question of which I have given private notice. In asking this Question, I declare that I have a bank account with NatWest.

My Lords, the Government unequivocally support the right to lawful free speech and consider it unacceptable for banks or other payment service providers to terminate contracts on these grounds. Earlier this year, the Government launched a call for evidence which included questions on the issue of payment account terminations and freedom of expression. We will soon set out plans for enhanced requirements applying to the termination of payment accounts.

My Lords, I am grateful to my noble friend for confirming that it is the Government’s view that no bank account should be closed for political reasons. Does she therefore agree that it is not for a bank to judge whether someone’s personal or political views accord with the so-called “values” of the bank and that that is not a reason for closing an account? Equally, does she agree that it is not for a bank to judge whether someone’s views are out of tone with wider society and then use that as the pretext for closing an account? Is this not a fundamental issue which ought to concern everyone of every party—left, right, centre or flat earth—who might all be the next person to suffer under what is happening? Will my noble friend ensure that the number of cases that have been reported recently, which, prima facie, seem to indicate that accounts may have been closed for political reasons, are referred to the regulator and investigated? Will she confirm that this a fundamental right of free speech in a free society?

I absolutely agree with my noble friend and reiterate once again that the Government unequivocally support the right to lawful free speech and consider it completely unacceptable for banks or other payment service providers to terminate contracts on these grounds. We issued a call for evidence that covered these issues and will consider all evidence as part of that. As my noble friend noted, I am sure that the regulator will also want to consider these matters.

My Lords, does the noble Baroness agree that part of the problem is that her department and the FCA were very slow to take action against the banks for the unwarranted interference in parliamentarians’ lives because they failed to operate the guidelines on PEPs appropriately and proportionately? Can we expect to see the FCA take disciplinary action against the banks that are doing this?

My Lords, it is important to distinguish between any action that may have been taken on freedom of speech grounds, or on the grounds of people’s political views, and the PEP regulations, which are to do with people’s status as politically exposed persons. However, the noble Lord is right, and we have discussed this issue in the House many times: the banks have not always applied those regulations and guidance as they should. That is why we had two amendments to the Financial Services and Markets Act to take action in this area, both to amend the regulations and for the FCA to review its guidance and the banks’ adherence to it. My right honourable friend the Economic Secretary has written to the FCA again recently to reiterate the importance of that review and to say that, if any action can be taken during the conduct of that review, we will expect that to happen also.

My Lords, I declare an interest as the chairman of a bank. I also have an account with Coutts Bank—although, by the way, I have nothing like the wealth that has been mentioned. I point out to my noble friend that Coutts Bank is owned by NatWest, and the largest shareholder in NatWest by a long way is the Government. Should the Government, as a shareholder, not say to NatWest that this kind of conduct is unacceptable? Also, what is the FCA doing? On the basis of what we read in the newspapers, Coutts Bank has been in breach of rule 4, which requires it to treat customers fairly.

My Lords, as my noble friend has noted, the Government have a shareholding in NatWest Group, but it is managed at arm’s length and on a commercial basis by UK Government Investments and I do think that is the right approach. My noble friend also noted the role of the FCA. He is right that it is for the FCA and other relevant independent bodies to determine whether any breach of regulatory requirements has taken place—so I will not comment on that, but I would expect them to do so.

My Lords, I gently suggest to the Minister that the issue of PEPs and the issue of people expressing their political views and then being treated badly are in fact entangled one with the other. I am just outraged that Nigel Farage was denied a bank account, but I was also denied a bank account at Chase UK this year because I could not produce physical payslips for my husband, who died 17 years ago. That had to be a specious reason, and I suspect that the real reason is that I am a Liberal Democrat who speaks out on issues in a way that the bank does not particularly like.

So I will just say that the PEP regime has got completely out of hand. It has been outsourced to consultants who make their money from dire and irrational interpretations. Will the Government please press the FCA not just to renew sensible guidance but to make sure that it is followed? Could she please tell it to focus its energies on the real abusers and the real money launderers?

Well, I can reassure the noble Baroness that that is exactly what the amendment to the Financial Services and Markets Act requires the FCA to do. It should look not just at the appropriateness of the guidance but at firms’ adherence to that guidance. We have asked it to get feedback from those who are affected by this guidance and take particular account of the impact on family members, which is an issue that many noble Lords have raised with me. We expect the FCA to follow that rigorously. The FCA is required to provide an update to this House on the progress of that work within a few months of it starting, and I am sure noble Lords will pay close attention to that.

My Lords, I know it is customary for children to blame their parents for everything, but will the Minister extend her concern to credit cards? My daughter, who is a very modest earner and has had the same credit card provider for 20 years, is being investigated in depth, with every piece of financial information needing to be produced, and we can think of no reason other than that I am her mother.

The changes to the regulations that the Government are committed to and the review by the FCA do not just cover banks; they cover the provision of credit cards and all other services that are covered by the anti-money laundering regulations relating to politically exposed persons.

My Lords, on at least two occasions Lords Ministers have indicated that the complete integrity of the money-laundering regulations is more important than facilitating the export of armoured fighting vehicles to Ukraine, even under export licence. In the light of what has happened recently, will the Minister agree either that this matter will be reviewed or to have a further meeting with me?

My Lords, I am not sure that events recently pertain to the particular case raised by the noble Lord. I was pleased to meet with him and as I committed to then and commit to on an ongoing basis, we will continue to engage with the Ministry of Defence to ensure that we have an understanding of the issue and that people do not face a wider systemic barrier.

My Lords, I declare my interest as chairman of C Hoare & Co. Does the Minister agree that customer confidentiality should lie at the heart of banking, and that a bank apparently commenting on the income and wealth of a customer is completely unacceptable?

I agree with the noble Lord on both points. When it comes to assessing whether that has taken place, that is a question for the regulator.

My Lords, I have to express a bit of concern about what I take to be the mood of the House. Will the Minister confirm that a PEP regime is essential, albeit one that is properly operated, and secondly, that if people cannot account properly for their income, it is right and proper for banks to refuse to continue an account?

My Lords, that is why it is important to distinguish between the PEP regime, which has caused problems for people, and questions about banks’ actions in relation to freedom of speech or political views. It is important, though, in both circumstances, whether you are a PEP or you have expressed any view that is lawfully held, that you have access to bank accounts. In taking forward our work on PEPs in particular, we are mindful of always maintaining our commitment to international standards in this area, and our amendments to the Financial Services and Markets Act do just that.

Has my noble friend had any discussions with her colleagues in the Foreign, Commonwealth and Development Office about the fact that some overseas missions find it impossible to open bank accounts in the UK? This happens the entire time, and it seems rather invidious to ask these people to come here to open embassies and then say they cannot bank when they are here.

FCDO colleagues have not raised this with me but if there is an issue, I will be more than happy to sit down with other departments and discuss what we can do about it.

My Lords, access to financial services should of course never be determined by a person’s political views, but just as those with assets of £1 million should not unduly be denied a bank account with Coutts & Co., so those with substantially less should not be denied access to basic banking services. Yet the Financial Conduct Authority estimates that more than 1 million people in the UK have no bank account and one in four people will experience financial exclusion at least once in their lives. The Government recently overturned Labour’s amendment to the Financial Services and Markets Act to require the FCA to have regard to financial inclusion. Do the Government now regret that decision?

My Lords, I absolutely agree about the importance of financial inclusion, and we have seen significant progress on that issue in recent years, including through establishing provision of basic bank accounts. That means that anyone in society, whatever their means, has the right to access banking, and we will continue to promote access through our work on financial inclusion.

My Lords, in answer to my noble friend Lord Forsyth, my noble friend the Minister said that the Government had their shareholding handled at arm’s length, or words to that effect. I completely accept that, but the moral fact is that the Government are the largest shareholder, so should they not take a particular interest in this political issue?

My Lords, the Government have taken an interest in this issue, which is why we issued a call for evidence earlier this year that covered freedom of speech and bank account closure. That is the right avenue through which the Government should seek to address this issue, rather than through their shareholding in a particular bank.

My Lords, I am fully in favour of the Government protecting the rights of the “Coutts one”, as they should be protecting the rights of the 1 million who cannot get a bank account. But is it not perverse, on the day that the Prime Minister has rightly apologised for the egregious treatment of LGBT people in the Armed Forces, for the Home Secretary to widen this debate into a full-frontal attack on equality, diversity and inclusion? Is that not totally unacceptable as well?

My Lords, I think the point we can all agree on is that the right to lawful freedom of speech is fundamental. Where that has been seen to be brought into question through the provision of services, we have cause to worry.

The Minister rightly upheld the need for access. One of the ways people access banks is through bricks and mortar branches in our towns and cities. These continue to be closed; every week banks are closing. What conversations has her department had with banks about their closures and what was the content of those discussions?

This is an issue we have discussed, including during the passage of the Financial Services and Markets Act. The Government legislated in that Act to protect access to cash for consumers and business depositors, which will help people continue to access banking. Banking hubs are also being rolled out in areas that may be seeing closures, and those signed up to banking hubs have given a commitment that, where a hub is due to be opened in an area, the last bank will not shut until it is open.

My Lords, as the Minister will remember, I tabled an amendment to the financial services Bill on this very question—as distinct from PEPs—of political values closing down accounts, and I was told that evidence was being sought. Is the Minister concerned that the only reason we now know this is happening is not because of anything the Government have done, but because a high-profile figure is pursuing the issue and getting a lot of attention? Secondly, can the Minister comment more broadly on the danger of the corporate power of financial services being used to bully customers into accepting certain values of equality, diversity and inclusion that have nothing to do with equality or diversity in any real sense, but with imposing their views on customers, for fear they will get their accounts cut off?

I reassure the noble Baroness that the Government’s commitment to issuing a call for evidence included issues of payment account terminations and freedom of expression. I believe the call for evidence closed before the issue that prompted this Question came to light. The Government are delivering on their commitment.

I close by stating once again that the Government unequivocally support the right to lawful free speech and consider it unacceptable for banks or other payment service providers to terminate contracts on these grounds.

That the draft Order laid before the House on 12 June be approved.

Considered in Grand Committee on 12 July.

That this House do agree with the Commons in their Amendments 1 to 6.

My Lords, the Government’s intention has always been that this Bill should apply UK-wide. In the process of delivering this ambition, we were able to confirm that legislative consent was not required from Northern Ireland or Wales. However, in the case of Scotland, private property law, as affected by this Bill, is a devolved matter and therefore legislative consent is necessary. As a result of amendments made to the Bill in the other place, we have received legislative consent from the Scottish Parliament.

The Bill has been amended to the effect that it now confers the delegated power in Clause 5(2)(b) additionally on Scottish Ministers both to exercise the power alone within areas of devolved competence and to act jointly with the Secretary of State. By including the option for Scottish Ministers to act alone and also to act jointly with the Secretary of State, the delegated powers can be exercised in a flexible manner that best suits the prevailing need for secondary legislation. Moreover, it avoids any future uncertainty as to whether matters are within the devolved competence of Scottish Ministers, particularly if they cut across devolved and reserved matters. The requirement in Clause 5(4) for the Secretary of State to consult Scottish Ministers before exercising the power in Clause 5(2)(b) will be disapplied in circumstances where the Secretary of State and Scottish Ministers act jointly to make regulations.

As noted earlier, while the Bill is unlikely to need future amendment, we believe that such changes are best delivered through concurrent delegated powers, which will allow both the Secretary of State and Scottish Ministers to make those changes. The amendments will therefore enable Scottish Ministers to make such regulations in a case in which all the provision made by the regulations is within Scottish devolved competence, and to act jointly with, or be consulted by, the Secretary of State in other cases.

The delegated powers previously afforded to the Secretary of State by the Bill are not substantively affected by this amendment. In view of this, Amendment 6 provides for regulations under Clause 5 to be subject to the affirmative resolution procedure at Westminster and in the Scottish Parliament.

In addition to these two substantive amendments, we have also had to include four consequential amendments to update and correct cross-references within the Bill. I hope noble Lords will acknowledge the requirement for the amendment to Clause 5 to change the delegated power and the consequential amendments that allow this new clause to be inserted into the Bill.

I reiterate the thanks that my noble friend Lord Parkinson of Whitley Bay gave at Third Reading to all those involved in the passage of this transformational Bill. I beg to move.

My Lords, I have studied the amendments closely and I can see the beneficial net effect of them. I guess that Amendment 4 is probably the most crucial to the package, and I think the noble Viscount was right to introduce them together in the way he did. I do not have much to say other than that, except to congratulate the Government on having the foresight to bring this legislation forward, and to thank the noble Lord, Lord Parkinson, for the work he did both in the Special Public Bill Committee and on the Floor of the House in considering the legislation.

I have a question for the noble Viscount, which I asked the last time we considered the Bill. This is a very important and significant piece of legislation that will go a long way to making the passage of international trade much easier, considering the impact that it could have. It will make it much easier to trade across international boundaries, and the volume of trade is such that removing the constraint on the use of electronic communication is extremely important. It is estimated that it could save as much as 15% of current transaction costs. That would be a considerable net benefit to the UK economy.

The one thing that worried and troubled me during our consideration was that there did not seem to be an implementation plan. When I quizzed the noble Lord, Lord Parkinson, on this, I was less than convinced by his response; I hope he was more convinced than I was. I do not see a plan yet. There is a role for one of the government departments involved in this to take a lead. It is really important that it does so in a way that works well with business, and consults business and all other interests to ensure that we get the maximum from this legislation; otherwise, I suspect it will lie unused.

We are one of only two jurisdictions that have made advances and progress on this. I know that others are looking at our work in the field and, if we can make a success of it, others will undoubtedly follow—but it needs leadership at the top to make this useful piece of legislation workable in future and to enhance our credentials as an international trading country.

My Lords, I add my thanks to the Minister for moving these amendments from the Commons. He has shown remarkable consistency with the words of his honourable friend Mr Scully in the Commons—I think word for word it is what he said, so that is excellent. I see other members of the committee here; I am only sorry that the noble and learned Lord, Lord Thomas of Cwmgiedd, is not here to see the final process and see this legislation go forward.

I welcome these amendments, because it means that the legislation will cover the whole United Kingdom, and that the exception power in Clause 5 will operate across the UK. Could the Minister say whether anything is in contemplation under Clause 5 to be excepted in using that power across the UK?

I very much agree with what the noble Lord, Lord Bassam, said about a plan for implementation. This is a much more important Bill than it appears at first sight, and we should really speed it on its way in implementation terms.

My Lords, I rise briefly to support the amendments as set out. In doing so, I declare my technology interests as set out in the register.

This is the most important Bill that no one has ever heard of. It demonstrates what we can do when we combine the potential of these new technologies with the great good fortune of common law that we have in this country. I particularly support the comments made by the noble Lords, Lord Bassam and Lord Clement-Jones, about the Government’s plan for implementation. Although it is obviously critical that we get Royal Assent to this Bill as soon as possible, that is really where the work begins. As my noble friend the Minister knows, the Bill is rightly permissive in nature; it cannot be that, having done all the work through both Houses of Parliament, the Bill is then just left on the shelf. There needs to be an active plan for implementation, communicating to all the sectors and all the organisations, institutions and brilliant businesses in this space to seize the opportunity that comes from electronic trade documents. Does my noble friend the Minister agree— and will he fill out some more detail on what that implementation plan is?

I thank all three noble Lords who have commented. The noble Lord, Lord Bassam, and others have rightly raised the issue of how we implement the provision, and I could not agree more strongly that the prospect of such a brilliant and transformational Bill gathering dust on a shelf is rather depressing; it would be a great waste.

Industry is very keen to implement this itself, but it is on us to track how that is going and ensure that it does. On how exactly industry goes about it, I would like to write to noble Lords to explain that, because I very much recognise the importance of the question.

With respect to any actions envisaged in Clause 5, nothing is currently envisaged.

My Lords, the government amendments in this group relate to content reporting and complaints procedures. The Bill’s existing duties on each of these topics are a major step forward and will provide users with effective methods of redress. There will now be an enforceable duty on Part 3 services to offer accessible, transparent and easy-to-use complaints procedures. This is an important and significant change from which users and others will benefit directly.

Furthermore, Part 3 services complaints procedures will be required to provide for appropriate action to be taken in response to complaints. The duties here will fundamentally alter how complaints systems are operated by services, and providers will have to make sure that their systems are up to scratch. If services do not comply with their duties, they will face strong enforcement measures.

However, we have listened to concerns raised by your Lordships and others, and share the desire to ensure that complaints are handled effectively. That is why we have tabled Amendments 272AA and 274AA, to ensure that the Bill’s provisions in this area are the subject of a report to be published by Ofcom within two years of commencement.

Amendment 272AA places a requirement on Ofcom to undertake a report about Part 3 services reporting and complaints procedures. The report will assess the measures taken or in use by providers of Part 3 services to enable users and others to report content and make complaints. In assessing the content reporting and complaints measures in place, the report must take into account users’ and others’ experiences of those procedures—including how easy to use and clear they are for reporting content and making complaints, and whether providers are taking appropriate and timely action in response.

In this report, Ofcom must provide advice to the Secretary of State about whether she should use her power set out in Amendment 236C to make regulations imposing an alternative dispute resolution duty on category 1 services. Ofcom may also make wider recommendations about how the complaints and user redress provisions can be strengthened, and how users’ experiences with regard to complaints can be improved more broadly. Amendment 274AA is a consequential amendment ensuring that the usual confidentiality provisions apply to matters contained in that report.

These changes will ensure that the effectiveness of the Bill’s content reporting and complaints provisions can be thoroughly assessed by Ofcom two years after the commencement of the provision, providing time for the relevant reporting and complaints procedures to bed in.

Amendment 236C then provides that the Secretary of State will have a power to make regulations to amend the Act in order to impose an alternative dispute resolution duty on providers of category 1 services. This power can be used after the Secretary of State has published a statement in response to Ofcom’s report. This enables the Secretary of State to impose via regulations a duty on the providers of category 1 services to arrange for and engage in an impartial, out-of-court alternative dispute resolution procedure in respect of complaints. This means that, if the Bill’s existing user redress provisions are found to be insufficient, this requirement can quickly be imposed to strengthen the Bill.

This responds directly to concerns which noble Lords raised about cases where users or parents may feel that they have nowhere to turn if they are dissatisfied with a service’s response to their complaint. We believe that the existing provisions will remedy this, but, if they do not, these new requirements will ensure that there is an impartial, alternative dispute resolution procedure which will work towards the effective resolution of the complaint between the service and the complainant.

At the same time, it will avoid creating a single ombudsman, person or body which may be overwhelmed either through the volume of complaints from multiple services or by the complexity of applying such disparate services’ varying terms of service. Instead, if required, this power will put the onus on the provider to arrange for and engage in an impartial dispute resolution procedure.

Amendment 237D requires that, if regulations are made requiring category 1 services to offer an alternative dispute resolution procedure, such regulation must be subject to the affirmative parliamentary procedure. This ensures that Parliament will continue to have oversight of this process.

I hope that noble Lords are reassured that the Bill not only requires services to provide users and others with effective forms of redress but that these further amendments will ensure that the Bill’s provisions in this area will be thoroughly reviewed and that action can be taken quickly if it is needed. I beg to move.

My Lords, I am grateful to hear what the Minister has just announced. The scheme that was originally prefigured in the pre-legislative scrutiny report has now got some chance of being delivered. I think the process and procedures are quite appropriate; it does need review and thought. There needs to be account taken of practice on the ground, how people have found the new system is working, and whether or not there are gaps that can be filled this way. I give my full support to the proposal, and I am very glad to see it.

Having got to the Dispatch Box early, I will just appeal to our small but very important group. We are on the last day on Report. We are reaching a number of issues where lots of debate has taken place in Committee. I think it would be quite a nice surprise for us all if we were to get through this quickly. The only way to do that is by restricting our contributions.

My Lords, I will speak briefly to Amendments 272AA and 274AA, only because at the previous stage of the Bill I tabled amendments related to the reporting of illegal content and fraudulent advertisements, both in reporting, and complaints and transparency. I have not re-tabled them here, but I have had conversations with my noble friend the Minister. It is still unclear to those in the House and outside why the provisions relating to that type of reporting would not apply to fraudulent advertisements, particularly given that the more information that can be filed about those types of scams and fraudulent advertisements, the easier it would be for the platforms to gather information, and help users and others to start to crack down on that. I wonder if, when he sums up, my noble friend could say something about the reporting provisions relating to fraudulent advertisements generally, and in particular around general reporting and reporting relating to complaints by users.

My Lords, I am mindful of the comments of the noble Lord, Lord Stevenson, to be brief. I add a note of welcome to the mechanism that has been set out.

In this legislation, we are initiating a fundamental change to the way in which category 1 providers will run their reporting systems, in that prior to this they have not had any external oversight. Ofcom’s intervention will be material, given that online service providers will have to explain to Ofcom what they are doing and why.

We should note that we are also asking providers to do some novel prioritisation. The critical thing with all these reporting systems is that they operate at such huge volumes. I will not labour the points, but if noble Lords are interested they can look at the Meta and YouTube transparency reports, where it is explained that they are actioning tens of millions of pieces of content each month, on the basis of hundreds of millions of reports. If you get even 1% of 10 million reports wrong, that is 100,000 errors. We should have in mind the scale we are operating at. Ofcom will not be able to look at each one of those, but I think it will be able to produce a valuable system and make sure that quality control is improved across those systems, working with the providers. Having additional powers to create an alternative dispute resolution mechanism where one does not exist and would prove to be useful is helpful. However, the slow and steady approach of seeing what will happen with those systems under Ofcom supervision before jumping into the next stage is right.

I also note that we are asking platforms to do some prioritisation in the rest of the Online Safety Bill. For example, we are saying that we wish journalistic and politician content to be treated differently from ordinary user content. All of those systems need to be bedded in, so it makes sense to do it at a reasonable pace.

I know that the noble Baroness, Lady Newlove, who cannot be here today, was also very interested in this area and wanted to make sure we made the point that the fact there is a reasonable timescale for the review does not mean that we should take our foot off the pedal now for our expectations for category 1 service providers. I think I heard that from the Minister, but it would be helpful for him to repeat it. We will be asking Ofcom to keep the pressure on to get these systems right now, and not just wait until it has done the report and then seek improvements at that stage. With that—having been about as brief as I can be— I will sit down.

My Lords, I promise I will be brief. I, too, welcome what the Minister has said and the amendments that the Government have proposed. This is the full package which we have been seeking in a number of areas, so I am very pleased to see it. My noble friend Lady Newlove and the noble Baroness, Lady Kidron, are not in their places, but I know I speak for both of them in wanting to register that, although the thoughtful and slow-and-steady approach has some benefits, there also some real costs to it. The UK Safer Internet Centre estimates that there will be some 340,000 individuals in the UK who will have no recourse for action if the platforms complaints mechanism does not work for them in the next two years. That is quite a large number of people, so I have one very simple question for the Minister: if I have exhausted the complaints procedure with an existing platform in the next two years, where do I go? I cannot go to Ofcom. My noble friend Lord Grade was very clear in front of the committee I sit on that it is not Ofcom’s job. Where do I go if I have a complaint that I cannot get resolved in the next two years?

My Lords, I declare an interest as chair of Trust Alliance Group, which operates the energy and communications ombudsman schemes, so I have a particular interest in the operation of these ADR schemes. I thank the Minister for the flexibility that he has shown in the provision about the report by Ofcom and in having backstop powers for the Secretary of State to introduce such a scheme.

Of course, I understand that the noble Baroness, Lady Newlove, and the UK Safer Internet Centre are very disappointed that this is not going to come into effect immediately, but there are advantages in not setting out the scheme at this very early point before we know what some of the issues arising are. I believe that Ofcom will definitely want to institute such a scheme, but it may be that, in the initial stages, working out the exact architecture is going to be necessary. Of course, I would have preferred to have a mandated scheme, in the sense that the report will look not at the “whether” but the “how”, but I believe that at the end of the day it will absolutely obvious that there needs to be such an ADR scheme in order to provide the kind of redress the noble Baroness, Lady Harding, was talking about.

I also agree with noble Baroness, Lady Morgan, that the kinds of complaints that this would cover should include fraudulent adverts. I very much hope that the Minister will be able to answer the questions that both noble Baronesses asked. As my noble friend said, will he reassure us that the department and Ofcom will not take their foot off the pedal, whatever the Bill may say?

I am grateful to noble Lords for their warm support and for heeding the advice of the noble Lord, Lord Stevenson, on brevity. We must finish our Report today. The noble Lord, Lord Allan, is right to mention my noble friend Lady Newlove, who I have spoken to about this issue, as well as the noble Lord, Lord Russell of Liverpool, who has raised some questions here.

Alongside the strong duties on services to offer content reporting and complaints procedures, our amendments will ensure that the effectiveness of these provisions can be reviewed after they have had sufficient time to bed in. The noble Lord, Lord Allan, asked about timing in more detail. Ofcom must publish the report within the two-year period beginning on the day on which the provision comes into force. That will allow time for the regime to bed in before the report takes place, ensuring that its conclusions are informed by how the procedures work in practice. If necessary, our amendments will allow the Secretary of State to impose via regulations a duty on the providers of category 1 services to arrange for and engage in an impartial, out-of-court alternative dispute resolution procedure, providing the further strengthening which I outlined in opening.

I can reassure my noble friend Lady Morgan of Cotes that reporting mechanisms to facilitate providers’ removal of fraudulent advertisements are exactly the kinds of issues that Ofcom’s codes of practice will cover, subject to consultation and due process. As companies have duties to remove fraudulent advertising once they are alerted to it, we expect platforms will need the necessary systems and processes in place to enable users to report fraudulent adverts so that providers can remove them.

My noble friend Lady Harding asked the question which was posed a lot in Committee about where one goes if all avenues are exhausted. We have added further avenues for people to seek redress if they do not get it but, as I said in Committee, the changes that we are bringing in through this Bill will mark a significant change for people. Rather than focusing on the even-further-diminished possibility of their not having their complaints adequately addressed through the additional amendments we are bringing today, I hope she will see that the provisions in the Bill and in these amendments as bringing in the change we all want to see to improve users’ safety online.

My Lords, Amendments 238A and 238D seek to change the parliamentary process for laying—oh, I am skipping ahead with final day of Report enthusiasm.

As noble Lords know, companies will fund the costs of Ofcom’s online safety functions through annual fees. This means that the regime which the Bill ushers in will be cost neutral to the taxpayer. Once the fee regime is operational, regulated providers with revenue at or above a set threshold will be required to notify Ofcom and to pay a proportionate fee. Ofcom will calculate fees with reference to the provider’s qualifying worldwide revenue.

The Delegated Powers and Regulatory Reform Committee of your Lordships’ House has made two recommendations relating to the fee regime which we have accepted, and the amendments we are discussing in this group reflect this. In addition, we are making an additional change to definitions to ensure that Ofcom can collect proportionate fees.

A number of the amendments in my name relate to qualifying worldwide revenue. Presently, the Bill outlines that this should be defined in a published statement laid before Parliament. Your Lordships’ committee advised that it should be defined through regulations subject to the affirmative procedure. We have agreed with this and are proposing changes to Clause 76 so that Ofcom can make provisions about qualifying worldwide revenue by regulations which, as per the committee’s recommendations, will be subject to the affirmative procedure.

Secondly, the committee recommended that we change the method by which the revenue threshold is defined. Presently, as set out in the Bill, it is set by the Secretary of State in a published statement laid before Parliament. The committee recommended that the threshold be set through regulations subject to the negative procedure and we are amending Clause 77 to make the recommended change.

Other amendments seek to make a further change to enable Ofcom to collect proportionate fees from providers. A provider of a regulated service the qualifying worldwide revenue of which is equal to, or greater than, the financial threshold will be required to notify Ofcom and pay an annual fee, calculated by reference to its qualifying worldwide revenue. Currently, this means that that fee calculation can be based only on the revenue of the regulated provider. The structure of some technology companies, however, means that how they accrue revenue is not always straightforward. The entity which meets the definition of a provider may therefore not be the entity which generates revenue referable to the regulated service.

Regulations to be made by Ofcom about the qualifying worldwide revenue will therefore be able to provide that the revenue accruing to certain entities in the same group as a provider of a regulated service can be taken into account for the purposes of determining qualifying worldwide revenue. This will enable Ofcom, when making such regulations, to make provisions, if necessary, to account for instances where a provider has a complex group structure; for example, where the regulated provider might accrue only a portion of the revenue referrable to the regulated service, the rest of which might be accrued by other entities in the group’s structure. These amendments to Clause 76 address these issues by allowing Ofcom to make regulations which provide that the revenue from certain other entities within the provider’s group structure can be taken into account. I beg to move.

My Lords, we have not talked much about fees in our consideration of the Bill, and I will not talk much about them today, but there are some important questions. We should not skip too lightly over the fact that we will be levying revenues from online providers. That might have a significant impact on the markets. I have some specific questions about this proposed worldwide revenue method but I welcome these amendments and that we will now be getting a better procedure. This will also allow the Minister to say, “All these detailed points can be addressed when these instruments come before Parliament”. That is a good development. However, there are three questions that are worth putting on the record now so that we have time to think about them.

First, what consideration will be given to the impact on services that do not follow a classic revenue model but instead rely on donations and other sorts of support? I know that we will come back to this question in a later group but there are some very large internet service providers that are not the classic advertising-funded model, instead relying on foundations and other things. They will have significant questions about what we would judge their qualifying worldwide revenue to be, given that they operate to these very different models.

The second question concerns the impact on services that may have a very large footprint outside the UK, and significant worldwide revenues, but which do very little business within the UK. The amendment that the Minister has tabled about group revenues is also relevant here. You can imagine an entity which may be part of a very large worldwide group making very significant revenues around the world. It has a relatively small subsidiary that is offering a service in the UK, with relatively low revenues. There are some important questions there around the potential impact of the fees on decision-making within that group. We have discussed how we do not want to end up with less choice for consumers of services in the UK. There is an interesting question there as to whether getting the fee level wrong might lead to worldwide entities saying, “If you’re going to ask me to pay a fee based on my qualifying worldwide revenue, the UK market is just not worth it”. That may particularly true if, for example, the European Union and other markets are also levying a fee. You can see a rational business choice of, “We’re happy to pay the fee to the EU but not to Ofcom if it is levied at a rate that is disproportionate to the business that we do here”.

The third and very topical question is about the Government’s thinking about services with declining revenues but whose safety needs are not reducing and may even be increasing. I hope as I say this that people have Twitter in mind, which has very publicly told us that its revenue is going down significantly. It has also very publicly fired most of its trust and safety staff. You can imagine a model within which, because its revenue is declining, it is paying less to Ofcom precisely when Ofcom needs to do more supervision of it.

I hope that we can get some clarity around the Government’s intentions in these circumstances. I have referenced three areas where the worldwide qualifying revenue calculation may go a little awry. The first is where the revenue is not classic commercial income but comes from other sources. The second is where the footprint in the UK is very small but it is otherwise a large global company which we might worry will withdraw from the market. The third, and perhaps most important, is what the Government’s intention is where a company’s revenue is declining and it is managing its platform less well and its Ofcom needs increase, and what we would expect to happen to the fee level in those circumstances.

My Lords, there is very little to add to that. These are important questions. I simply was struck by the thought that the amount of work, effort and thought that has gone into this should not be kept within this Bill. I wonder whether the noble Lord has thought of offering his services to His Majesty’s Treasury, which has difficulty in raising tax from these companies. It would be nice to see that problem resolved.

I am looking forward to returning to arts and heritage; I will leave that to my noble friend Lady Penn.

The noble Lord, Lord Allan, asked some good questions. He is right: the provisions and the parliamentary scrutiny allow for the flexibility for all these things to be looked at and scrutinised in the way that he set out. I stress that the fee regime is designed to be fair to industry; that is central to the approach we have taken. The Bill stipulates that Ofcom must charge only proportionate and justifiable fees to industry. The provisions that Ofcom can make via regulation about the qualifying worldwide revenue aim to ensure that fees are truly representative of the revenue relating to the regulated service and that they will encourage financial transparency. They also aim to aid companies with complex structures which would otherwise struggle to segregate revenues attributable to the provider and its connected entities.

The revenue of the group undertaking can be considered in scope of a provider’s qualifying worldwide revenue if the entity was a member of the provider’s group during any part of the qualifying period and the entity receives during the qualifying period any amount referrable to a regulated service. The regulations provide Ofcom with a degree of flexibility as to whether or not to make such provisions, because Ofcom will aim to keep the qualifying worldwide revenue simple.

I am grateful for noble Lords’ support for the amendments and believe that they will help Ofcom and the Government to structure a fair and transparent fee regime which charges proportionate fees to fund the cost of the regulatory regime that the Bill brings in.

My Lords, as I was eagerly anticipating, government Amendments 238A and 238D seek to change the parliamentary process for laying the first regulations specifying the category 1 threshold conditions from the negative to the affirmative procedure. I am pleased to bring forward this change in response to the recommendation of your Lordships’ Delegated Powers and Regulatory Reform Committee.

The change will ensure that there are adequate levels of parliamentary scrutiny of the first regulations specifying the category 1 threshold conditions. This is appropriate given that the categorisation of category 1 services will lead to the most substantial duties on the largest and most influential services. As noble Lords are aware, these include the duties on user empowerment, user identity verification, journalistic and news publisher content, content of democratic importance, and fraudulent advertising.

Category 2A services will have only additional transparency and fraudulent advertising duties, and category 2B services will be subject only to additional transparency reporting duties. The burden of these duties is significantly less than the additional category 1 duties, and we have therefore retained the use of the negative resolution procedure for these regulations, as they require less parliamentary scrutiny.

Future changes to the category 1 threshold conditions will also use the negative procedure. This will ensure that the regime remains agile in responding to change, which I know was of particular concern to noble Lords when we debated the categorisation group in Committee. Keeping the negative procedure for such subsequent uses will avoid the risk of future changes being subject to delays because of parliamentary scheduling. I beg to move.

My Lords, I shall speak to Amendment 245. I would like to thank my noble friend the Minister, and also the Minister on leave, for the conversations that I have had with them about this amendment and related issues. As we have already heard, the platform categorisation is extremely important. So far, much of it is unknown, including which sites are actually going to be in which categories. For example, we have not yet seen any proposed secondary regulations. As my noble friend has just outlined, special duties apply, especially for those sites within category 1—user empowerment in particular, but also other duties relating to content and fraudulent advertisements.

Clause 85 and Schedule 11 set out the thresholds for determining which sites will be in category 1, category 2A or category 2B. I am very mindful of the exhortation of the noble Lord, Lord Stevenson, about being brief, but it is amazing how much you have to say about one word to explain this amendment. This amendment proposes to change an “and” to an “or” in relation to determining which sites would fall within category 1. It would move from a test of size “and” functionality to a test of size “or” functionality. This would give Ofcom more flexibility to decide which platforms really need category 1 designation. Category 1 should not be decided just on size; it should also be possible to determine it on the basis of functionality.

Functionality is defined in the Bill in Clause 208. We will get to those amendments shortly, but there is no doubt from what the Government have already conceded, or agreed with those of us who have been campaigning passionately on the Bill for a number of years, that functionality can make a platform harmful. It is perfectly possible to have small platforms that both carry highly harmful content and themselves become harmful in the way that they are designed. We have heard many examples and I will not detain the House with them, but I draw attention to two particular sites which capture how broad this is. The perpetrators of offline hate crimes are often linked to these small platforms. For example, the perpetrator of the 2018 Tree of Life synagogue mass shooting had an online presence on the right-wing extremist social network Gab. In the UK, Jake Davison, the self-proclaimed incel who killed five people in Plymouth in 2021, frequented smaller incel forums after he was banned from Reddit in the days leading up to the mass shooting.

I also want to share with noble Lords an email that I received just this week from a family who had been to see their Member of Parliament, Matt Rodda MP, and also the noble Baroness, Lady Kidron, who I know is very regretful that she cannot be here today. I thank Victoria and Jean Eustace for sharing the story of their sister and daughter. Victoria wrote: “I am writing to you regarding the Online Safety Bill, as my family and I are concerned it will not sufficiently protect vulnerable adults from harm. My sister, Zoe Lyalle, killed herself on 26 May 2020, having been pointed towards a method using an online forum called Sanctioned Suicide. Zoe was 18 years old at the time of her death and as such technically an adult, but she was autistic, so she was emotionally less mature than many 18 year- olds. She found it difficult to critically analyse written content”. She says that “The forum in question is not large and states on its face that it does not encourage suicide, although its content does just that”. The next part I was even more shocked about: “Since Zoe’s death, we have accessed her email account. The forum continues to email Zoe, providing her with updates on content she may have missed while away from the site, as well as requesting donations. One recent email included a link to a thread on the forum containing tips on how best to use the precise method that Zoe had employed”.

In her note to me, the Minister on leave said that she wanted to catch some of the platforms we are talking about with outsized influence. In my reply, I said that those sites on which people are encouraged to take their own lives or become radicalised and therefore take the harms they are seeing online into the real world undoubtedly exercise influence and should be tackled.

It is also perfectly possible for us to have large but safe platforms. I know that my noble friend Lord Moylan may want to discuss this in relation to sites that he has talked about already on this Bill. The risk of the current drafting is a flight of users from these large platforms, newly categorised as category 1, to the small, non-category 1 platforms. What if a platform becomes extremely harmful very quickly? How will it be recategorised speedily but fairly and involving parliamentary oversight?

The Government have run a variety of arguments as to why the “and” in the Bill should not become an “or”. They say that it creates legal uncertainty. Every Bill creates legal uncertainty; that is why we have an army of extremely highly paid lawyers, not just in this country but around the world. They say that what we are talking about is broader than illegal content or content related to children’s safety, but they have already accepted an earlier amendment on safety by design and, in subsections (10) to (12) of Clause 12, that specific extra protections should be available for content related to

“suicide or an act of deliberate self-injury, or … an eating disorder or behaviours associated with an eating disorder”

or abusive content relating to race, religion, sex, sexual orientation, disability or gender reassignment and that:

“Content is within this subsection if it incites hatred against people”.

The Government have already breached some of their own limits on content that is not just illegal or relates to child safety duties. In fact, they have agreed that that content should have enhanced triple-shield protection.

The Government have also said that they want to avoid burdens on small but low-harm platforms. I agree with that, but with an “or” it would be perfectly possible for Ofcom to decide by looking at size or functionality and to exclude those smaller platforms that do not present the harm we all care about. The Minister may also offer me a review of categorisation; however, it is a review of the tiers of categorisation and not the sites within the categories, which I think many of us will have views on over the years.

I come to what we should do on this final day of Report. I am very thankful to those who have had many conversations on this, but there is a fundamental difference of opinion in this House on these matters. We will talk about functionality shortly and I am mindful of the pre-legislative scrutiny committee’s recommendation that this legislation should adopt

“a more nuanced approach, based not just on size and high-level functionality, but factors such as risk, reach, user base, safety performance, and business model”.

There should be other factors. Ofcom should have the ability to decide whether it takes one factor or another, and not have a series of all the thresholds to be passed, to give it the maximum flexibility. I will listen very carefully to what my noble friend the Minister and other noble Lords say, but at this moment I intend to test the opinion of the House on this amendment.

My Lords, I strongly support Amendment 245. The noble Baroness, Lady Morgan of Cotes, has explained the nub of the problem we are facing—that size and functionality are quite separate. You can have large sites that perform a major social function and are extremely useful across society. Counter to that, you can have a small site focused on being very harmful to a small group of people. The problem is that, without providing the flexibility to Ofcom to determine how the risk assessment should be conducted, the Bill would lock it into leaving these small, very harmful platforms able to pursue their potentially ever-increasingly harmful activities almost out of sight. It does nothing to make sure that their risk assessments are appropriate.

My Lords, I am pleased to follow the noble Baroness, Lady Morgan of Coates, and her amendment, which tries to help parliamentary counsel draft better regulations later on. I am really struggling to see why the Government want to resist something that will make their life easier if they are going to do what we want them to do, which is to catch those high-risk services—as the noble Baroness, Lady Finlay, set out—but also, as we have discussed in Committee and on Report, exclude the low-risk services that have been named, such as Wikipedia and OpenStreetMap.

I asked the Minister on Report how that might happen, and he confirmed that such services are not automatically exempt from the user-to-user services regulations, but he also confirmed that they might be under the subsequent regulations drafted under Schedule 11. That is precisely why we are coming back to this today; we want to make sure that they can be exempt under the regulations drafted under Schedule 11. The test should be: would that be easier under the amended version proposed by the noble Baroness, Lady Morgan, or under the original version? I think it would be easier under the amended version. If the political intent is there to exclude the kind of services that I have talked about—the low-risk services—and I think it should be, because Ofcom should not be wasting time, in effect, supervising services that do not present a risk and, not just that, creating a supervisory model that may end up driving those services out of the UK market because they cannot legally say that they will make the kind of commitments Ofcom would expect them to make, having two different thresholds, size and functionality, gives the draftspeople the widest possible choice. By saying “or”, we are not saying they cannot set a condition that is “and” or excludes “and”, but “and” does exclude “or”, if I can put it that way. They can come back with a schedule that says, “You must be of this size and have this kind of functionality”, or they could say “this functionality on its own”—to the point made by the two noble Baronesses about some sites. They might say, “Look, there is functionality which is always so high-risk that we do not care what size you are; if you’ve got this functionality, you’re always going to be in”. Again, the rules as drafted at the moment would not allow them to do that; they would have to say, “You need to have this functionality and be of this size. Oh, whoops, by saying that you have to be of this size, we’ve now accidentally caught somebody else who we did not intend to catch”.

I look forward to the Minister’s response, but it seems entirely sensible that we have the widest possible choice. When we come to consider this categorisation under Schedule 11 later on, the draftspeople should be able to say either “You must be this size and have this functionality” or “If you’ve got this functionality, you’re always in” or “If you’re of this size, you’re always in”, and have the widest possible menu of choices. That will achieve the twin objectives which I think everyone who has taken part in the debate wants: the inclusion of high-risk services, no matter their size, and the exclusion of low-risk services, no matter their size—if they are genuinely low risk. That is particularly in respect of the services we have discussed and which the noble Lord, Lord Moylan, has been a very strong advocate for. In trying to do good, we should not end up inadvertently shutting down important information services that people in this country rely on. Frankly, people would not understand it if we said, “In the name of online safety, we’ve now made it so that you cannot access an online encyclopaedia or a map”.

It is going to be much harder for the draftspeople to draft categorisation under Schedule 11, as it is currently worded, that has the effect of being able to exclude low-risk services. The risk of their inadvertently including them and causing that problem is that much higher. The noble Baroness is giving us a way out and I hope the Minister will stand up and grab the lifeline. I suspect he will not.

My Lords, I welcome the Minister’s Amendment 238A, which I think was in response to the DPRRC report. The sentiment around the House is absolutely clear about the noble Baroness’s Amendment 245. Indeed, she made the case conclusively for the risk basis of categorisation. She highlighted Zoe’s experience and I struggle to understand why the Secretary of State is resisting the argument. She knocked down the nine pins of legal uncertainty, and how it was broader than children and illegal by reference to Clause 12. The noble Baroness, Lady Finlay, added to the knocking down of those nine pins.

Smaller social media platforms will, on the current basis of the Bill, fall outside category 1. The Royal College of Psychiatrists made it pretty clear that the smaller platforms might be less well moderated and more permissive of dangerous content. It is particularly concerned about the sharing of information about methods of suicide or dangerous eating disorder content. Those are very good examples that it has put forward.

I return to the scrutiny committee again. It said that

“a more nuanced approach, based not just on size and high-level functionality, but factors such as risk, reach, user base, safety performance, and business model”

should be adopted. It seems that many small, high-harm services will be excluded unless we go forward on the basis set out by the noble Baroness, Lady Morgan. The kind of breadcrumbing we have talked about during the passage of the Bill and, on the other hand, sites such as Wikipedia, as mentioned by noble friend, will be swept into the net despite being low risk.

I have read the letter from the Secretary of State which the noble Baroness, Lady Morgan, kindly circulated. I cannot see any argument in it why Amendment 245 should not proceed. If the noble Baroness decides to test the opinion of the House, on these Benches we will support her.

My Lords, I have good news and bad news for the Minister. The good news is that we have no problem with his amendments. The bad news, for him, is that we strongly support Amendment 245 from the noble Baroness, Lady Morgan of Coates, which, as others have said, we think is a no-brainer.

The beauty of the simple amendment has been demonstrated; it just changes the single word “and” to “or”. It is of course right to give Ofcom leeway—or flexibility, as the noble Baroness, Lady Finlay, described it—in the categorisation and to bring providers into the safety regime. What the noble Baroness, Lady Morgan, said about the smaller platforms, the breadcrumbing relating to the Jake Davison case and the functionality around bombarding Zoe Lyalle with those emails told the story that we needed to hear.

As it stands, the Bill requires Ofcom to always be mindful of size. We need to be more nuanced. From listening to the noble Lord, Lord Allan of Hallam—with his, as ever, more detailed analysis of how things work in practice—my concern is that in the end, if it is all about size, Ofcom will end up having to have a much larger number in scope on the categorisation of size in order to cover all the platforms that it is worried about. If we could give flexibility around size or functionality, that would make the job considerably easier.

We on this side think categorisation should happen with a proportionate, risk-based approach. We think the flexibility should be there, the Minister is reasonable—come on, what’s not to like?

My Lords, I shall explain why the simple change of one word is not as simple as it may at first seem. My noble friend’s Amendment 245 seeks to amend the rule that a service must meet both a number-of-users threshold and a functionality threshold to be designated as category 1 or 2B. It would instead allow the Secretary of State by regulation to require a service to have to meet only one or other of the two requirements. That would mean that smaller user-to-user services could be so categorised by meeting only a functionality threshold.

In practical terms, that would open up the possibility of a future Secretary of State setting only a threshold condition about the number of users, or alternatively about functionality, in isolation. That would create the risk that services with a high number of users but limited functionality would be caught in scope of category 1. That could be of particular concern to large websites that operate with limited functionality for public interest reasons, and I am sure my noble friend Lord Moylan can think of one that fits that bill. On the other hand, it could capture a vast array of low-risk smaller services merely because they have a specific functionality—for instance, local community fora that have livestreaming capabilities. So we share the concerns of the noble Lord, Lord Allan, but come at it from a different perspective from him.

My noble friend Lady Morgan mentioned the speed of designation. The Bill’s approach to the pace of designation for the category 1 watchlist and register is flexible—deliberately so, to allow Ofcom to act as quickly as is proportionate to each emerging service. Ofcom will have a duty proactively to identify, monitor and evaluate emerging services, which will afford it early visibility when a service is approaching the category 1 threshold. It will therefore be ready to act accordingly to add services to the register should the need arise.

The approach set out in my noble friend’s Amendment 245 would not allow the Secretary of State to designate individual services as category 1 if they met one of the threshold conditions. Services can be designated as category 1 only if they meet all the relevant threshold conditions set out in the regulations made by the Secretary of State. That is the case regardless, whether the regulations set out one condition or a combination of several conditions.

The noble Baroness, Lady Finlay, suggested that the amendment would assist Ofcom in its work. Ofcom itself has raised concerns that amendments such as this—to introduce greater flexibility—could increase the risk of legal challenges to categorisation. My noble friend Lady Morgan was part of the army of lawyers before she came to Parliament, and I am conscious that the noble Lord, Lord Clement-Jones, is one as well. I hope they will heed the words of the regulator; this is not a risk that noble Lords should take lightly.

I will say more clearly that small companies can pose significant harm to users—I have said it before and I am happy to say it again—which is why there is no exemption for small companies. The very sad examples that my noble friend Lady Morgan gave in her speech related to illegal activity. All services, regardless of size, will be required to take action against illegal content, and to protect children if they are likely to be accessed by children. This is a proportionate regime that seeks to protect small but excellent platforms from overbearing regulation. However, I want to be clear that a small platform that is a font of illegal content cannot use the excuse of its size as an excuse for not dealing with it.

Category 1 services are those services that have a major influence over our public discourse online. Again, I want to be clear that designation as a category 1 service is not based only on size. The thresholds for category 1 services will be based on the functionalities of a service as well as the size of the user base. The thresholds can also incorporate other characteristics that the Secretary of State deems relevant, which could include factors such as a service’s business model or its governance. Crucially, Ofcom has been clear that it will prioritise engagement with high-risk or high-impact services, irrespective of their categorisation, to understand their existing safety systems and how they plan to improve them.

My Lords, this amendment would require the Secretary of State, when seeking to exercise certain powers in the Bill, to provide the relevant Select Committees of both Houses with draft regulations and impact assessments, among other things. I should admit up front that this is a blatant attempt to secure an Online Safety Bill version of what I have called the “Grimstone rule”, established in the international trade Bill a few years ago. Saving his blushes, if the ideas enshrined in the amendment are acceptable to the Government, I hope that the earlier precedent of the “Grimstone rule” would ensure that any arrangements agreed under this amendment would be known in future as the “Parkinson rule”. Flattery will get you many things.

The Bill places a specific consultation requirement on the Government for the fee regime, which we were just talking about, categorisation thresholds, regulations about reports to the NCA, statements of strategic priorities, regulations for super-complaints, and a review of the Act after three years—so a wide range of issues need to be put out for consultation. My context here, which is all-important, is a growing feeling that Parliament’s resources are not being deployed to the full in scrutinising and reviewing the work of the Executive on the one hand and feeding knowledge and experience into future policy on the other. There is continuing concern about the effectiveness of the secondary legislation approval procedures, which this amendment would bear on.

Noble Lords have only to read the reports of the Select Committees of both Houses to realise what a fantastic resource they represent. One has only to have served on a Select Committee to realise what potential also exists there. In an area of rapid technical and policy development, such as the digital world, the need to be more aware of future trends and potential problems is absolutely crucial.

The pre-legislative scrutiny committee report is often quoted here, and it drew attention to this issue as well, recommending

“a Joint Committee of both Houses to oversee digital regulation with five primary functions: scrutinising digital regulators and overseeing the regulatory landscape … scrutinising the Secretary of State’s work into digital regulation; reviewing the codes of practice laid by Ofcom under any legislation relevant to digital regulation … considering any relevant new developments such as the creation of new technologies and the publication of independent research … and helping to generate solutions to ongoing issues in digital regulation”—

a pretty full quiver of issues to be looked at.

I hope that when he responds to this debate, the Minister will agree that ongoing parliamentary scrutiny would be helpful in providing reassurances that the implementation of the regime under the Bill is going as intended, and that the Government would also welcome a system under which Parliament, perhaps through the Select Committees, can contribute to the ways suggested by the Joint Committee. I say “perhaps”, because I accept that it is not appropriate for primary legislation to dictate how, or in what form, Parliament might offer advice in the manner that I have suggested; hence the suggestion embedded in the amendment—which I will not be pressing to a Division—which I call the “Parkinson rule”. Under this, the Minister would agree at the Dispatch Box a series of commitments which will provide an opportunity for enhanced cross-party scrutiny of the online safety regime and an opportunity to survey and report on future developments of interest.

The establishment of the new Department for Science, Innovation and Technology and its Select Committee means that there is a new dedicated Select Committee in the Commons. The Lords Communications and Digital Committee will continue, I hope, to play a vital role in the scrutiny of the digital world, as it has with the online safety regime to date. While it would be for the respective committees to decide their priorities, I hope the Government would encourage the committees in both Houses to respond to their required consultation processes and to look closely at the draft codes of practice, the uses of regulation-making powers and the powers of direction contained in the Bill ahead of the formal processes in both Houses. Of course, it could be a specialist committee if that is what the Houses decide, but there is an existing arrangement under which this “Parkinson rule” could be embedded. I have discussed the amendment with the Minister and with the Bill team. I look forward to hearing their response to the ideas behind the amendment. I beg to move the “Parkinson rule”.

I support the amendment of the noble Lord, Lord Stevenson. Here is an opportunity for the Minister to build a legislative monument. I hope he will take it. The reason I associate myself with it is because the noble Lord, Lord Stevenson—who has been sparing in his quoting of the Joint Committee’s report, compared with mine—referred to it and it all made very good sense.

The amendment stumbles only in the opinion of the Government, it seems, on the basis that parliamentary committees need to be decided on by Parliament, rather than the Executive. But this is a very fine distinction, in my view, given that the Government, in a sense, control the legislature and therefore could will the means to do this, even if it was not by legislation. A nod from the Minister would ensure that this would indeed take place. It is very much needed. It was the Communications and Digital Committee, I think, that introduced the idea that we picked up in the Joint Committee, so it has a very good provenance.

My Lords, I offer my support to the amendment. I spent some time arguing in the retained EU law Bill for increased parliamentary scrutiny. My various amendments did not succeed but at the end of the day—on the final day of ping-pong—the Minister, the noble Lord, Lord Callanan, gave certain assurances based on what is in Schedule 5 to that Act, as it now is, involving scrutiny through committees. So the basic scheme which my noble kinsman has proposed is one which has a certain amount of precedent—although it is not an exact precedent; what might have been the “Callanan rule” is still open to reconstruction as the “Parkinson rule”. I support the amendment in principle.

My Lords, as the noble Lords, Lord Stevenson and Lord Clement-Jones, have already said, the Communications and Digital Select Committee did indeed recommend a new Joint Committee of both Houses to look specifically at the various different aspects of Ofcom’s implementation of what will be the Online Safety Act and ongoing regulation of digital matters. It is something I still have a lot of sympathy for. However, there has not been much appetite for such a Joint Committee at the other end of the Corridor. I do not necessarily think we should give up on that, and I will come back to that in a moment, but in place of that, I am not keen on what is proposed in Amendment 239, because my fear about how that is laid out is that it introduces something that appears a bit too burdensome and probably introduces too much delay in implementation.

To return to the bigger question, I think that we as parliamentarians need to reflect on our oversight of regulators, to which we are delegating significant new powers and requiring them to adopt a much more principles-based approach to regulation to cope with the fast pace of change in the technological world. We have to reflect on whether our current set-up is adequate for the way in which that is changing. What I have in mind is very much a strategic level of oversight, rather than scrutinising operational decisions, although, notwithstanding what the noble Lord has said, something specific in terms of implementation of the Bill and other new legislation is an area I would certainly wish to explore further.

The other aspect of this is making sure that our regulators keep pace too, not just with technology, and apply the new powers we give them in a way which meets our original intentions, but with the new political dynamics. Earlier today in your Lordships’ Chamber, there was a Question about how banks are dealing with political issues, and that raises questions about how the FCA is regulating the banking community. We must not forget that the Bill is about regulating content, and that makes it ever more sensitive. We need to keep reminding ourselves about this; it is very new and very different.

As has been acknowledged, there will continue to be a role for the Communications and Digital Select Committee, which I have the great privilege of chairing, in overseeing Ofcom. My noble friend Lord Grade and Dame Melanie Dawes appeared before us only a week ago. There is a role for the SIT Committee in the Commons; there is also probably some kind of ongoing role for the DCMS Select Committee in the Commons too, I am not sure. In a way, the fractured nature of that oversight makes it all the more critical that we join up a bit more. So I will take it upon myself to give this more thought and speak to the respective chairs of those committees in the other place, but I think that at some point we will need to consider, in some other fora, the way in which we are overseeing the work of regulators.

At some point, I think we will need to address the specific recommendations in the pre-legislative committee’s report, which were very much in line with what my own committee thought was right for the future of digital regulatory oversight, but on this occasion, I will not be supporting the specifics of Amendment 239.

My Lords, very briefly, I was pleased to see this, in whatever form it takes, because as we finish off the Bill, one thing that has come up consistently is that some of us have raised problems of potential unintended consequences, such as whether age gating will lead to a huge invasion of the privacy of adults rather than just narrowly protecting children, or whether the powers given to Ofcom will turn it into the most important and powerful regulator in the country, if not in Europe. In a highly complex Bill, is it possible for us to keep our eye on it a bit more than just by whingeing on the sidelines?

The noble Baroness, Lady Stowell, makes a very important point about the issue in relation to the FCA and banking. Nobody intended that to be the outcome of PEPs, for example, and nobody intended when they suggested encouraging banks to have values such as ESG or EDI—equality, diversity and inclusion—that that would lead to ordinary citizens of this country being threatened with having their banking turned off. It is too late to then retrospectively say, “That wasn’t what we ever intended”.

I associate myself with the comments of my noble friend Lady Stowell on this whole issue, and I refer to my register of interests. One question we should be asking, which goes wider than this Bill, is: who regulates the regulators? It is a standard problem in political science and often known as principal agent theory, whereby the principals delegate powers to the agents for many reasons, and you see agency slack, whereby they develop their own powers beyond what was perhaps originally intended. For that reason, I completely associate myself with my noble friend Lady Stowell’s comments—and not because she chairs a committee on which I sit and I hope to get a favour of more speaking time on that committee. It is simply because, on its merit, we should all be asking who regulates the regulators and making sure that they are accountable. We are asking the same question of the Secretary of State, and quite rightly, the Secretary of State should be accountable for any measures they propose, but we should also be asking it of regulators.

My Lords, I have always felt rather sorry for the first Viscount Addison, because what we refer to as the Salisbury convention is really the Salisbury-Addison convention. So while I am grateful to the noble Lord, Lord Stevenson, for his flattering speech, I shall insist on calling it the “Parkinson-Stevenson rule”, not least in the hope that that mouthful will encourage people to forget its name more swiftly.

I am grateful to the noble Lord for his attention to this matter and the useful discussions that we have had. His Amendment 239 would go beyond the existing legislative process for the delegated powers in the Bill by providing for parliamentary committees to be, in effect, inserted into the secondary legislative process. The delegated powers in the Bill are crucial for implementing the regime effectively and for ensuring that it keeps pace with changes in technology. Regulation-making powers are an established part of our legislative practice, and it would not be appropriate to deviate from existing processes.

However, I agree that ongoing parliamentary scrutiny of the regime will be crucial in helping to provide noble Lords and Members in another place with the reassurance that the implementation of the regime is as we intended. As the noble Lord noted, the establishment of the Science, Innovation and Technology Select Committee in another place means that there is a new dedicated committee looking at this important area of public policy. That provides an opportunity for cross-party scrutiny of the online safety regime and broader issues. While it will be, as he said, for respective committees to decide their priorities, we welcome any focus on online safety, and certainly welcome committees in both Houses co-operating effectively on this matter. I am certain that the Communications and Digital Committee of your Lordships’ House will continue to play a vital role in the scrutiny of the online safety regime.

We would fully expect these committees to look closely at the codes of practice, the uses of regulation-making powers and the powers of direction in a way that allows them to focus on key issues of interest. To support that, I can commit that the Government will do two things. First, where the Bill places a consultation requirement on the Government, we will ensure that the relevant committees have every chance to play a part in that consultation by informing them that the process is open. Secondly, while we do not wish to see the implementation process delayed, we will, where possible, share draft statutory instruments directly with the relevant committees ahead of the formal laying process. These timelines will be on a case-by-case basis, considering what is appropriate and reasonably practical. It will be for the committees to decide how they wish to engage with the information that we provide, but it will not create an additional approval process to avoid delaying implementation. I am grateful to my noble friend Lady Stowell of Beeston for her words of caution and wisdom on that point as both chairman of your Lordships’ committee and a former Leader of your Lordships’ House.

I hope that the noble Lord will be satisfied by what I have set out and will be willing to withdraw his amendment so that our rule might enter into constitutional history more swiftly.

I am very grateful to everyone who has contributed to the debate, despite my injunction that no one was to speak other than those key persons—but it was nice to hear views around the House in support for this proposal, with caution. The noble Baroness, Lady Stowell, was right to be clear that we have to be focused on where we are going on this; there is quite a lot at stake here, and it is a much bigger issue than simply this Bill and these particular issues. Her willingness to take this on in a wider context is most welcome, and I look forward to hearing how that goes. I am also very grateful for the unexpected but very welcome support from the noble Baroness, Lady Fox. It was nice that she finally agreed to meet on one piece of territory, if we cannot agree on some of the others. The noble Lord, Lord Kamall, is right to say that we need to pick up the much broader question about who regulates those who regulate us. This is not the answer, but it certainly gets us a step in the direction.

I was grateful to the Minister for suggesting that the “Parkinson rule” could take flight, but I shall continue to call it by a single name—double-barrelled names are not appropriate here. We will see the results of that in the consultation; the things that already have to be consulted about will be offered to the committees, and it is up to them to respond on that, but it is a very good start. The idea that drafts and issues that are being prepared for future regulation will be shown ahead of the formal process is exactly where I wanted to be on this, so I am very grateful for that. I withdraw the amendment.

My Lords, if I may, I shall speak very briefly, in the absence of my noble friend Lady Kidron, and because I am one of the signatories of this amendment, alongside the noble Lord, Lord Stevenson, and the right reverend Prelate the Bishop of Oxford. Amendment 240, together with a number of amendments that we will be debating today, turns on a fundamental issue that we have not yet resolved.

I came in this morning being told that we would be voting on this amendment and that other amendments later today would be consequential—I am a novice at this level of parliamentary procedure, so forgive me if I have got myself confused during the day—but I now understand that my noble friend considers this amendment to be consequential but, strangely, the amendments right at the end of the day are not. I just wanted to flag to the House that they all cover the same fundamental issue of whether harms can be unrelated to content, whether the harms of the online world can be to do with functionality—the systems and processes that drive the addiction that causes so much harm to our children.

It is a fundamental disagreement. I pay tribute to the amount of time the department, the Secretary of State and my noble friend have spent on it, but it is not yet resolved and, although I understand that I should now say that I beg leave to move the amendment formally, I just wanted to mark, with apologies, the necessity, most likely, of having to bring the same issue back to vote on later today.

My Lords, His Majesty’s Government indeed agree that this is consequential on the other amendments, including Amendment 35, which the noble Baroness, Lady Kidron, previously moved at Report. We disagreed with them, but we lost that vote; this is consequential, and we will not force a Division on it.

We will have further opportunity to debate the fundamental issues that lie behind it, to which my noble friend Lady Harding just referred. Some of the amendments on which we may divide later, the noble Baroness, Lady Kidron, tabled after defeating the Government the other day, so we cannot treat them as consequential. We look forward to debating them; I will urge noble Lords not to vote for them, but we will have opportunity to discuss them later.

My Lords, I wish to test the opinion of the House and I beg to move.

I beg to move Amendment 247A.

My Lords, these amendments are concerned with Ofcom’s powers under Clause 111 to issue notices to deal with terrorism content and child sexual exploitation and abuse content.

I acknowledge the concerns which have been aired about how these powers work with encrypted services. I want to make it clear that the Bill does not require companies to break or weaken encryption, and we have built in strong safeguards to ensure that users’ privacy is protected. Encryption plays an important role online, and the UK supports its responsible use. I also want to make it clear that we are not introducing a blanket requirement for companies to monitor all content for all harms, at all times. That would not be proportionate.

However, given the serious risk of harm to children from sexual abuse and exploitation online, the regulator must have appropriate, tightly targeted powers to compel companies to take the most effective action to tackle such reprehensible illegal activity which is taking place on their services. We must ask companies to do all that is technically feasible to keep children safe, subject to stringent legal safeguards.

The powers in the Bill are predicated on risk assessments. If companies are managing the risks on their platform appropriately, Ofcom will not need to use its powers. As a last resort, however, where there is clear evidence of child sexual abuse taking place on a platform, Ofcom will be able to direct companies either to use, or to make best efforts to develop or source, accredited and accurate technology to identify and remove this illegal content. To be clear, these powers will not enable Ofcom or our law enforcement agencies to obtain any automatic access to the content detected. It is simply a matter of making private companies take effective action to prevent child sexual abuse on their services.

Ofcom must consider a wide range of matters when deciding whether a notice is necessary and proportionate, including the impacts on privacy and freedom of expression of using a particular technology on a particular service. Ofcom will only be able to require the use of technology accredited as highly accurate in detecting illegal child sexual abuse or terrorism content, vastly minimising the risk that content is wrongly identified.

In addition to these safeguards, as a public body, Ofcom is bound through the Human Rights Act 1998 by the European Convention on Human Rights, including Articles 8 and 10. Ofcom has an obligation not to act in a way which unduly interferes with the right to privacy and freedom of expression when carrying out its duties, for which it is held to account.

If appropriate technology does not exist which meets these requirements, Ofcom cannot require its use. That is why the powers include the ability for Ofcom to require companies to make best endeavours to develop or source a solution. It is right that we can require technology companies to use their considerable resources and expertise to develop the best possible protections for children in encrypted environments.

Despite the breadth of the existing safeguards, we recognise that concerns remain about these powers, and we have listened to the points that noble Lords raised in Committee about privacy and technical feasibility. That is why we are introducing additional safeguards. I am grateful for the constructive engagement I have had with noble Lords across your Lordships’ House on this issue, and I hope that the government amendments alleviate their concerns.

I turn first to our Amendments 250B, 250C, 250D, 255A, 256A, 257A, 257B, 257C and 258A, which require that Ofcom obtain a skilled persons’ report before issuing a warning notice and exercising its powers under Clause 111. This independent expert scrutiny will supplement Ofcom’s own expertise to ensure that it has a full understanding of relevant technical issues to inform its decision-making. That will include issues specific to the service in question, such as its design and relevant factors relating to privacy.

My Lords, I am conscious of the imprecation earlier from the noble Lord, Lord Stevenson of Balmacara, that we keep our contributions short, but I intend to take no notice of it. That is for the very good reason that I do not think the public would understand why we disposed of such a momentous matter as bringing to an end end-to-end encryption on private messaging services as a mere technicality and a brief debate at the end of Report.

It is my view that end-to-end encryption is assumed nowadays by the vast majority of people using private messaging services such as WhatsApp, iMessage and Signal. They are unaware, I think, of the fact that it is about to be taken from them by Clause 111 of the Bill. My amendment would prevent that. It is fairly plain; it says that

“A notice under subsection (1)”

of Clause 111

“may not impose a requirement relating to a service if the effect of that requirement would be to require the provider of the service to weaken or remove end-to-end encryption applied in relation to the service”.

My noble friend says that there is no threat of ending end-to-end encryption in his proposal, but he achieves that by conflating two things—which I admit my own amendment conflates, but I will come back to that towards the end. They are the encryption of platforms and the encryption of private messaging services. I am much less concerned about the former. I am concerned about private messaging services. If my noble friend was serious in meaning that there was no threat to end-to-end encryption, then I cannot see why he would not embrace my amendment, but the fact that he does not is eloquent proof that it is in fact under threat, as is the fact that the NSPCC and the Internet Watch Foundation are so heavily lobbying against my amendment. They would not be doing that if they did not think it had a serious effect.

I shall not repeat at any length the technical arguments we had in Committee, but the simple fact is that if you open a hole into end-to-end encryption, as would be required by this provision, then other people can get through that hole, and the security of the system is compromised. Those other people may not be very nice; they could be hostile state actors—we know hostile state actors who are well enough resourced to do this—but they could also be our own security services and others, from whom we expect protection. Normally, we do get a degree of protection from those services, because they are required to have some form of warrant or prior approval but, as I have explained previously in debate on this, these powers being given to Ofcom require no warrant or prior approval in order to be exercised. So there is a vulnerability, but there is also a major assault on privacy. That is the point on which I intend to start my conclusion.

If we reflect for a moment, the evolution of this Bill in your Lordships’ House has been characterised and shaped, to a large extent, by the offer made by the noble Lord, Lord Stevenson of Balmacara, when he spoke at Second Reading, to take a collaborative approach. But that collaborative approach has barely extended to those noble Lords concerned about privacy and freedom of expression. As a result, in my view, those noble Lords rightly promoting child protection have been reckless to the point of overreaching themselves.

If we stood back and had to explain to outsiders that we were taking steps today that took end-to-end encryption and the privacy they expect on their private messaging services away from them, together with the security and protection it gives, of course, in relation to scams and frauds and all the other things where it has a public benefit, then I think they would be truly outraged. I do not entirely understand how the Government think they could withstand that outrage, were it expressed publicly. I actually believe that the battle for this Bill—this part of this Bill, certainly—is only just starting. We may be coming to the end here, but I do not think that this Bill is settled, because this issue is such a sensitive one.

Given the manifest and widespread lack of support for my views on this question in your Lordships’ House in Committee, I will not be testing the opinion of the House today. I think I know what the opinion of the House is, but it is wrong, and it will have to be revised. My noble friend simply cannot stand there and claim that what he is proposing is proportionate and necessary, because it blatantly and manifestly is not.

My Lords, the powers in Clause 111 are perhaps the most controversial outstanding issue in the Bill. I certainly agree with the noble Lord, Lord Moylan, that they deserve some continued scrutiny. I suspect that Members of another place are being lobbied on this extensively right now. Again, it is one of the few issues; they may not have heard of the Online Safety Bill, but they will do in the context of this particular measure.

We debated the rights and wrongs of encryption at some length in Committee, and I will not repeat those points today, not least because the noble Lord, Lord Moylan, has made some of the arguments as to why encryption is important. I will instead today focus on the future process, assuming that the Clause 111 powers will be available to Ofcom as drafted and that we are not going to accept the amendment from the noble Lord, Lord Moylan.

Amendments 258 and 258ZA, in my name and that of my noble friend Lord Clement-Jones, both aim to improve the process of issuing a Clause 111 order by adding in some necessary checks and balances.

As we debate this group, we should remember that the Clause 111 powers are not specific to encrypted services—I think the Minister made this point—and we should have the broader context in mind. I often try to bring some concrete scenarios to our discussions, and it may be helpful to consider three different scenarios in which Ofcom might reach for a Clause 111 notice.

The first is where a provider has no particular objections to using technology to identify and remove child sexual exploitation and abuse material or terrorist material but is just being slow to do this. There are mature systems out there. PhotoDNA is very well known in the industry and effectively has a database with digital signatures of known child sexual exploitation material. All the services we use on a daily basis such as Facebook, Instagram and others will check uploaded photos against that database and, where it is child sexual exploitation material, they will make sure that it does not get shown and that those people are reported to the authorities.

I can imagine scenarios where Ofcom is dealing with a service which has not yet implemented the technology—but does not have a problem doing it—and the material is unencrypted so there is no technical barrier; it is just being a bit slow. In those scenarios, Ofcom will tell the service to get on with it or it will get a Clause 111 notice. In those circumstances, in most cases the service will just get on with it, so Ofcom will be using the threat of the notice as a way to encourage the slow coaches. That is pretty unexceptional; it will work in a pretty straightforward way. I think the most common use of these notices may be to bring outliers into the pack of those who are following best practice. Ofcom may not even need to issue any kind of warning notice at all and will not get past the warning notice period. Waving a warning notice in front of a provider may be sufficient to get it to move.

The second scenario is one where the provider equally does not object to the use of the technology but would prefer to have a notice before it implements it. Outside the world of tech companies, it may seem a little strange why a provider would want to be ordered to do something rather than doing the right thing voluntarily, but we have to remember that the use of this kind of technology is legally fraught in many jurisdictions. There have been court cases in a number of places, not least the European Union, where there are people who will challenge whether you should use this technology on unencrypted services, never mind encrypted ones. In those cases, you can imagine there will be providers, particularly those established outside the United Kingdom, which may say, “Look, we are fine implementing this technology, but Ofcom please can you give us a notice? Then when someone challenges it in court, we can say that the UK regulator made us do it”. That would be helpful to them. This second group will want a notice and here we will get to the point of the notice being issued. They are not going to contest it; they want to have the notice because it gives them some kind of legal protection.

I think those two groups are relatively straightforward: we are dealing with companies which are being slow or are looking for legal cover but do not fundamentally object. The third scenario, though, is the most challenging and it is where I think the Government could get into real trouble. My amendments seek to help the Government in situations where a provider fundamentally objects to being ordered to deploy a particular technology because it believes that that technology will create real privacy threats and risks to the service that it offers. I do not think the provider is being awkward in these circumstances; it has genuine concerns about the implications of the technology being developed or which it is being instructed to deploy.

In these circumstances, Ofcom may have all the reasons in the world to argue why it thinks that what it is asking for is reasonable. However, the affected provider may not accept those reasons and take quite a strong counterview and have all sorts of other arguments as to why what it is being asked to do is unacceptable and too high-risk. This debate has been swirling around at the moment as we think about current models of end-to-end encryption and client-side scanning technology, but we need to recognise that this Bill is going to be around for a while and there may be all sorts of other technologies being ordered to be deployed that we do not even know about and have not even been developed yet. At any point, we may hit this impasse where Ofcom is saying it thinks it is perfectly reasonable to order a company to do it and the service provider is saying, “No, as we look at this, our experts and our lawyers are telling us that this is fundamentally problematic from a privacy point of view”.

My Lords, I have put my name to and support Amendment 255, laid by the noble Lord, Lord Moylan, which straight- forwardly means that a notice may not impose a requirement relating to a service that would require that provider to weaken or remove end-to-end encryption. It is very clear. I understand that the other amendments introduce safeguards, which is better than nothing. It is not what I would like, but I will support them if they are pushed a vote. I think that the Government should really consider seriously not going anywhere near getting rid of encryption in this Bill and reconsider it by the time we get to Third Reading.

As the noble Lord, Lord Moylan, explained, this is becoming widely known about now, and it is causing some concern. If passed, this Bill, as it is at the moment, gives Ofcom far-reaching powers to force services, such as WhatsApp, to install software that would scan all our private messages to see whether there is evidence of terrorism, child sexual exploitation or abusive content and would automatically send a report to third parties, such as law enforcement, if it suspects wrongdoing—all without the consent or control of the sender or the intended recipient.

I would just like to state that encryption is a wonderful innovation. That is why more than 40 million people in the UK use it every day. It ensures that our private messages cannot be viewed, compromised or altered by anyone else, not even providers of chat services. It really requires somebody handing them over to a journalist and saying, “You can have my WhatsApp messages for anyone to read them”: beyond that, you cannot read them.

One of the interesting things that we have discussed throughout the passage of the Bill is technologies, their design and functionality and making sure they are not harmful. Ironically, it is the design and function of encryption that actually helps to keep us safe online. That is why so many people talk about civil libertarians, journalists and brave dissenters using it. For the rest of us, it is a tool to protect our data and private communications in the digital realm. I just want to pose here that it is an irony that the technologies being proposed in terms of client-side scanning are the technologies that are potentially harmful because it is, as people have noted, the equivalent of putting video cameras in our homes to listening in to every conversation and send reports to the police if we discuss illicit topics. As I have said before, while child sexual abuse is horrendous and vile, we know that it happens largely in the home and, as yet, the Government have not advocated that we film in everybody’s home in order to stop child sexual abuse. We should do almost anything and everything that we can, but I think this is the wrong answer.

Focusing on encryption just makes no sense. The Government have made exemptions, recognising the importance, in a democracy, of private correspondence: so exempted in the Bill are text messages, MSN, Zoom, oral commentaries and email. It seems perverse to demonise encryption in this way. I also note that there are exemptions for anything sent on message apps by law enforcement or public sector or emergency responders. I appreciate that some government communications are said to be done over apps such as WhatsApp. It seems then that the target of this part of the Bill is UK private citizens and residents and that the public are seen as the people who must be spied on.

In consequence, I do not think it surprising that more than 80 national or international civil society organisations have said that this would make the UK the first liberal democracy to require the routine scanning of people’s private chat messages. What does the Minister say to the legal opinion from the technology barrister Matthew Ryder KC, commissioned by Index on Censorship precisely on this part of the Bill? He compares this to law enforcement wiretapping without a warrant and says that the Bill will grant Ofcom a wider remit of surveillance powers over the public than GCHQ has.

Even if the Minister is not interested in lawyers or civil libertarians, surely we should be listening to the advice of science and technology experts in relation to complex technological solutions. Which experts have been consulted? I noted that Matthew Hodgson, the boss of encrypting messaging app Element, has said wryly that

“the Government has not consulted with UK tech firms, only with huge multinational corporations and companies that want to sell software that scans messages, who are unsurprisingly telling lawmakers that it is possible to scan messages without breaking encryption”.

The problem is that it is not possible to scan those messages without breaking encryption. It is actually misinformation to say that. That is why whole swathes of leading scientists and technologists from across the globe have recently put out an open letter explaining why and how it is not true. They explained that it creates really dangerous side-effects that can be harmful in the way that the noble Lord, Lord Moylan, explained, in terms of security, and makes the online world less safe for many of us. Existing scanning technologies are flawed and ineffective and scanning will nullify the purpose of encryption. I refer noble Lords to the work of the Internet Society and the academic paper Bugs in Our Pockets: The Risks of Client-Side Scanning for more details on all the peer-reviewed work.

I understand that, given the horrific nature of child sexual abuse—and, of course, terrorism, but I shall concentrate on child sexual abuse because the Bill is so concerned with it—it can be tempting for the Government to hope that there is a technological silver bullet to eradicate it. But the evidence suggests otherwise. One warning from scientists is that scanning billions of pieces of content could lead to millions of false positives and that could not only frame innocent users but could mean that the police become overwhelmed, diverting valuable resources away from real investigations into child sexual abuse.

A study by the Max Planck Institute for the study of crime of a similar German law that lasted from 2008 to 2010 found that the German police having access to huge amounts of data did not have any deterrent effect, did not assist in cleaning up crimes or increase convictions, but did waste a lot of police time. So it is important that this draconian invasion of privacy is not stated as necessary for protecting children. I share the exasperation of Signal’s president Meredith Whittaker, who challenged the Secretary of State and pointed out that there were some double standards here: for example, slashing early intervention programmes over the past decade did not help protect children and chronically underfunding and underresourcing child social care does not help.

My own bugbears are that when I, having talked to social workers and colleagues, raised the dangers to child protection when we closed down schools in lockdown, they were brushed to one side. When I and others raised the horrors of the young girls who had been systematically raped by grooming gangs whom the authorities had ignored for many, many years, I was told to stop talking about it. There are real threats to children that we ignore. I do not want us in this instance to use that very emotive discussion to attack privacy.

I also want to stress that there is no complacency here. Law enforcement agencies in the UK already possess a wide range of powers to seize devices and compel passwords and even covertly to monitor and hack accounts to identify criminal activity. That is good. Crucially, private messaging services can and do— I am sure they could do more—work in a wide range of ways to tackle abuse and keep people safe without the need to scan or read people’s messages.

My Lords, I rise to speak in favour of my noble friend Lord Moylan’s amendment. Given that I understand he is not going to press it, and while I see Amendment 255 as the ideal amendment, I thank the noble Lords, Lord Stevenson and Lord Clement- Jones, for their Amendments 256, 257 and 259, and the noble Lords, Lord Clement-Jones and Lord Allan of Hallam, for Amendments 258 and 258ZA.

I will try to be as brief as I can. I think about two principles—unintended consequences and the history of technology transfer. The point about technology transfer is that once a technology is used it becomes available to other people quickly, even bad guys, whether that was intended or not. There is obviously formal technology transfer, where you have agreement or knowledge transfer via foreign investment, but let us think about the Cold War and some of the great technological developments—atomic secrets, Concorde and the space shuttle. In no time at all, the other side had that access, and that was before the advent of the internet.

If we are to open a door for access to encrypted messages, that technology will be available to the bad guys in no time at all, and they will use it against dissidents, many of whom will be in contact with journalists and human rights organisations in this country and elsewhere. Therefore, the unintended consequence may well be that in seeking to protect children in this country by accessing encrypted messages or unencrypted messages, we may well be damaging the childhoods of children in other countries when their parents, who are dissidents, are suddenly taken away and maybe the whole family is wiped out. Let us be careful about those unintended consequences.

I also welcome my noble friend Lord Parkinson’s amendments about ensuring journalistic integrity, such as Amendment 257D and others. They are important. However, we must remember that once these technologies are available, everyone has a price and that technology will be transferred to the bad guys.

Given that my noble friend Lord Moylan will not press Amendment 255, let us talk about some of the other amendments—I will make some general points rather than go into specifics, as many noble Lords have raised these points. These amendments are sub-optimal, but at least there is some accountability for Ofcom being able to use this power and using it sensibly and proportionately. One of the things that has run throughout this Bill and other Bills is “who regulates the regulators?” and ensuring that regulators are accountable. The amendments proposed by the noble Lords, Lord Stevenson and Lord Clement-Jones, and by the noble Lords, Lord Clement-Jones and Lord Allan of Hallam, go some way towards ensuring that safeguards are in place. If the Government are not prepared to have an explicit statement that they will not allow access to encrypted messages, I hope that there will be some support for the noble Lords’ amendments.

My Lords, I promise to speak very briefly. I welcome the Government’s amendments. I particularly welcome that they appear to mirror partly some of the safeguards that are embedded in the Investigatory Powers Act 2016.

I have one question for my noble friend the Minister about the wording, “a skilled person”. I am worried that “a skilled person” is a very vague term. I have been taken all through the course of this Bill by the comparison with the Investigatory Powers Act and the need to think carefully about how we balance the importance of privacy with the imperative of protecting our children and being able to track down the most evil and wicked perpetrators online. That is very similar to the debates that we had here several years ago on the Investigatory Powers Act.

The IPA created the Technical Advisory Board. It is not a decision-making body. Its purpose is to advise the Investigatory Powers Commissioner and judicial commissioners on the impact of changing technology and the development of techniques to use investigatory powers while maintaining privacy. It is an expert panel constituted to advise the regulator—in this case, the judicial commissioner—specifically on technology interventions that must balance this really difficult trade-off between privacy and child protection. Why have we not followed the same recipe? Rather than having a skilled person, why would we not have a technology advisory panel of a similar standing where it is clear to all who the members are. Those members would be required to produce a regular report. It might not need to be as regular as the IPA one, but it would just take what the Government have already laid one step further towards institutionalising the independent check that is really important if these Ofcom powers were ever to be used.

My Lords, I added my name to some amendments on this issue in Committee. I have not done so on Report, not least because I have been so occupied with other things and have not had the time to focus on this. However, I remain concerned about this part of the Bill. I am sympathetic to my noble friend Lord Moylan’s Amendment 255, but listening to this debate and studying all the amendments in this group, I am a little confused and so have some simple questions.

First, I heard my noble friend the Minister say that the Government have no intention to require the platforms to carry out general monitoring, but is that now specific in any of the amendments that he has tabled? Regarding the amendments which would bring further safeguards around the oversight of Ofcom’s use of this power, like my noble friend Lady Harding, I have always been concerned that the oversight approach should be in line with that for the Investigatory Powers Act and could never understand why it was not in the original version of the Bill. Like her, I am pleased that the Government have tabled some amendments, but I am not yet convinced that they go far enough.

That leads me to the amendments that have been tabled by the noble Lords, Lord Stevenson and Lord Clement-Jones, and particularly that in the name of the noble Lord, Lord Allan of Hallam. As his noble friend Lord Clement-Jones has added his name to it, perhaps he could answer my question when he gets up. Would the safeguards that are outlined there—the introduction of the Information Commissioner—meet the concerns of the big tech companies? Do we know whether it would meet their needs and therefore lead them not to feel it necessary to withdraw their services from the UK? I am keen to understand that.

There is another thing that might be of benefit for anyone listening to this debate who is not steeped in the detail of this Bill, and I look to any of those winding up to answer it—including my noble friend the Minister. Is this an end to end-to-end encryption? Is that what is happening in this Bill? Or is this about ensuring that what is already permissible in terms of the authorities being able to use their powers to go after suspected criminals is somehow codified in this Bill to make sure it has proper safeguards around it? That is still not clear. It would be very helpful to get that clarity from my noble friend, or others.

My Lords, it is a pleasure to follow the noble Baroness, Lady Stowell. My noble friend has spoken very cogently to Amendment 258ZA, and I say in answer to the question posed by the noble Baroness that I do not think this is designed to make big tech companies content. What it is designed to do is bring this out into the open and make it contestable; to see whether or not privacy is being invaded in these circumstances. To that extent it airs the issues and goes quite a long way towards allaying the concerns of those 80 organisations that we have heard from.

I am not going to repeat all the arguments of my noble friend, but many noble Lords, not least on the opposite Benches, have taken us through some of the potential security and privacy concerns which were also raised by my noble friends, and other reasons for us on these Benches putting forward these amendments. We recognise those concerns and indeed we recognise concerns on both sides. We have all received briefs from the NSPCC and the IWF, but I do not believe that essentially what is being proposed here in our amendments, or indeed by the amendments put forward by the noble Lord, Lord Stevenson, are designed in any way to prevent Ofcom doing its duty in relation to child sexual abuse and exploitation material in private messaging. We believe that review by the ICO to ensure that there is no invasion of privacy is a very useful mechanism.

We have all tried to find solutions and the Minister has put forward his stab at this with the skilled persons report. The trouble is, that does not go far enough, as the noble Baroness, Lady Stowell, said. Effectively, Ofcom can choose the skilled person and what the skilled person is asked to advise on. It is not necessarily comprehensive and that is essentially the major flaw.