Delegated Legislation Committee
Draft Conference of the Parties to the United Nations Framework Convention on Climate Change (Immunities and Privileges) Order 2021
The Committee consisted of the following Members:
Chair: Yvonne Fovargue
† Anderson, Lee (Ashfield) (Con)
† Benton, Scott (Blackpool South) (Con)
† Browne, Anthony (South Cambridgeshire) (Con)
† Carter, Andy (Warrington South) (Con)
† Colburn, Elliot (Carshalton and Wallington) (Con)
† Davison, Dehenna (Bishop Auckland) (Con)
† Day, Martyn (Linlithgow and East Falkirk) (SNP)
† Doughty, Stephen (Cardiff South and Penarth) (Lab/Co-op)
† Duddridge, James (Parliamentary Under-Secretary of State for Foreign, Commonwealth and Development Affairs)
† Griffiths, Kate (Burton) (Con)
† Harris, Rebecca (Lord Commissioner of Her Majesty's Treasury)
† McCabe, Steve (Birmingham, Selly Oak) (Lab)
† Morrissey, Joy (Beaconsfield) (Con)
Rees, Christina (Neath) (Lab/Co-op)
† Rimmer, Ms Marie (St Helens South and Whiston) (Lab)
† Sharma, Mr Virendra (Ealing, Southall) (Lab)
Sheerman, Mr Barry (Huddersfield) (Lab/Co-op)
Liam Laurence Smyth, Committee Clerk
† attended the Committee
First Delegated Legislation Committee
Monday 13 September 2021
[Yvonne Fovargue in the Chair]
Draft Conference of the Parties to the United Nations Framework Convention on Climate Change (Immunities and Privileges) Order 2021
Before we begin, I encourage Members to wear masks when not speaking, which is in line with current Government guidance and that of the House of Commons Commission. Please give each other and the staff space when seated and when entering and leaving the room. Speaking notes should be emailed to email@example.com, and any officials in the Public Gallery should communicate with Members electronically.
I beg to move,
That the Committee has considered the draft Conference of the Parties to the United Nations Framework Convention on Climate Change (Immunities and Privileges) Order 2021.
The instrument before us today was laid on 7 July in accordance with section 10(1) of the International Organisations Act 1968 and confers privileges and immunities in order support COP26. The draft order is required so that the UK can comply fully with the obligations of the host country agreement, which was negotiated with the secretariat of the United Nations framework convention on climate change.
The conference represents a unique opportunity to demonstrate the UK’s global climate leadership. During the COP26 talks, teams of negotiators, Government representatives, businesses and citizens will work together to solve the deeper problems around COP and the four priorities of mitigation, adaptation, climate finance and co-operation. We will welcome participants to Glasgow and recognise the need for them to be able to perform their functions freely and openly. I am able to confirm that we have reached an agreement to confer privileges and immunities on only three categories of participants: UN officials who do not already enjoy them; delegation members and observer states, otherwise known as “the parties”; and core personnel from the Clean Development Mechanism, the Green Climate Fund, the Adaptation Fund, and the Global Environment Facility.
To be clear, the order covers only acts performed in the course of official duties. It does not grant personal immunity, nor does it extend to British nationals, permanent residents, or spouses and partners. That is in line with other Government-to-Government conferences such as the G7 and Commonwealth Heads of Government meeting, both of which the UK recently hosted.
We have agreed with the UN a robust framework that will remain in place during the conference. It provides a balance between our desire to limit the granting of privileges and immunities and COP’s founding principles that all participants should, quite rightly, be able to voice their legitimate opinions without fear of legal repercussions. It also avoids setting an unwelcome precedent for UN conferences held in countries that lack the level of personal freedoms we in the UK are so proud to enjoy, particularly around the freedom of assembly. I commend the draft order to the Committee.
It is a pleasure to see in you in the Chair, Ms Fovargue. The official Opposition will of course not be opposing this statutory instrument, because it simply forms the standard process around events of this nature, as the Minister set out. I do, however, have some questions, particularly given some concerns around the organisation of the conference and covid regulations, and because is important to understand the legal privileges and immunities.
The Minister set out the categories included in the order. Will he say how many attendees will be covered by the categories of UN officials, delegations and observers—“the parties”—and the CDM, the Adaptation Fund and others? He will also be aware of the concerns expressed by the Least Developed Countries Group as recently as 10 September. This was not only about their demands at this COP for fair and ambitious action to meet the 1.5° pathway and mobilising scaled-up support for many of the countries most vulnerable to climate change, which are right and substantial, but their ability to participate in the conference, which is crucial to ensuring that their voices are heard and that pressure is put to bear on some of the world’s bigger emitters. If we are seeking the ambitious outcomes that the Government and the COP President have set out, how will we ensure that that group is able to participate?
The group stated on 10 September:
“We need assurances from the UK that COP26 will be fully inclusive and fair. Our countries and our people are among the worst affected by climate change – we must not be excluded from talks deciding how the world will deal with this crisis, determining the fate of our lives and livelihoods.”
The Minister will be aware that 20 countries from the group are currently on the UK’s travel red list, which comes with significant legal implications if red list quarantine rules are broken. Will he set out what support is being given to ensure that delegations can be both covid-safe and not excluded from participation? What methods are being put in place for other methods of participation? What support is available for quarantine arrangements and fees? The costs for small delegations that do not have the monetary resources at their disposal that we would have when sending a delegation to the G7 or other conferences will be substantial.
The 20 countries in the group includes many in sub-Saharan Africa, which comes under the normal portfolio that the Minister and I cover and includes crucial countries affected by climate change, such as Mozambique, Malawi, Lesotho, Burundi, the DRC, which is critical given its rainforests and the implications of climate change, and also Afghanistan. Is the Minister aware of whether any Afghan delegation will attend the COP given the indeterminate status of its current regime? We have heard what the Foreign Secretary has said about that, so what are the implications for the types of immunities and privileges being granted under this order?
What proportion of the official delegations does the Minister believe are attached to NGO or activist groups? That could include those who have diplomatic status or others.
I am grateful to my hon. Friend for giving way. I do not want to delay proceedings, and I understand the need for this draft order. I was going to ask the Minister this question, but he was too quick for me, so I thought I could ask it through my hon. Friend.
Most people will remember the disquiet in this country around the death of Harry Dunn and the fact that Anne Sacoolas was able to claim diplomatic immunity and return to the States without facing any consequences. Am I right in thinking that the provisions around immunities and privileges under article 5 would mean that if there was a serious road traffic incident, perhaps resulting in a death, the individual responsible would be secure from any consequences? Is that what we are approving?
My hon. Friend raises an important point. I have referred to covid laws and regulations, but the order applies to the conduct of delegations in many other respects, so I hope that the Minister will answer that question.
My last question relates to the delegations from the British overseas territories. Concerns have been raised with me by several overseas territories about the size of their delegation, and they feel that they could be more included in the COP process. I assume that they will not come under one of the categories of exemption because they are a part of the UK family, but clarification on that from the Minister would be useful. What does he understand to be their status at the conference?
Our overseas territories not only play a critical in terms of our contribution to global environmental and sustainability targets, particularly given the often pristine marine environments of these island states, but will be directly affected by climate change. In last week’s Westminster Hall debate I mentioned the British Virgin Islands, which suffered seriously during the hurricane of 2017, but it has lost as a result of Brexit some funding for climate change adaptation and resilience. However, it is likely that the islands will, tragically, face more hurricanes because of our warming environment.
Finally, the Intergovernmental Panel on Climate Change’s message is clear, and the unequivocal evidence is that we are in an emergency. It is right that the summit has an ambitious agenda, but that requires the participation of the countries and individuals who are most affected by climate change and will live with the consequences the longest. As I said, the Opposition will not oppose this draft order and its broad principles, but I hope the Minister will be able to answer my detailed questions.
I am grateful to the Minister for his explanation of the statutory instrument, which the SNP will also not oppose. It is very much part of the standard procedure for such events. However, articles 4 to 10, which give effect to certain legal measures, do not apply to Scotland and will be covered by a separate SI that requires the approval of the Scottish Parliament because policing and justice are of course devolved matters and part of Scotland’s independent legal system. That is a reminder not only of Scotland’s distinct nature and the need for it to be recognised at COP, but of the truly international nature of the effort to tackle climate change and of the need for the UK Government to do more to engage with the international community. I am grateful for what we have heard today.
I thank hon. Members for their constructive support for this SI. As for the number of people attending, the total is around 25,000, although others will clearly go along to fringe events. Approximately 12,500 people will be subject to the privileges and immunities—that is to say that they will be within the secure blue zone. I am sure that Glasgow will be full of many other activities outside the zone, but they are quite rightly not covered by the privileges and immunities. That perhaps answers the question of the hon. Member for Birmingham, Selly Oak. In fact, I am unsure whether there will be any vehicles in the blue zone. The privileges and immunities cover only the principal individuals, not their wives, husbands and families, and only within that secure area and only if they are doing their actual job—not driving, for example. The definition is narrow, partly because of the issue he raises.
The hon. Member for Cardiff South and Penarth talked about participation. It is important that as many parties participate as possible. The UN owns the list—it is a UN conference in the United Kingdom—so participation is a matter for the UN. It is arranging double vaccination for those coming, although take-up is low largely because attendees are likely to be double vaccinated already.
The hon. Gentleman mentioned the overseas territories, for which I was Minister with responsibility from 2014 to 2016. They are not officially parties to the agreement because they are not nation states, but the smaller islands clearly suffer worse from climate change and should be fully engaged. I will do everything to assist and help in that.
I do not have a full list of delegations, but certainly all the African countries that the hon. Gentleman and I communicate with have been invited and encouraged, and they are coming at various levels. I am therefore not concerned about the level of representation. He asked whether Afghanistan would be represented; I am not sighted of that matter, but I am happy to find out and send on that information.
NGOs and activists are outside the blue zone and will not be covered by the privileges and immunities legislation. I thank the Committee for this constructive sitting.
Question put and agreed to.
Health Protection (Coronavirus, Restrictions) (Steps etc.) (England) (Revocation and Amendment) Regulations 2021 Health Protection (Coronavirus, Restrictions) (Self-isolation) (England) (Amendment) Regulations 2021 Health Protection (Coronavirus, Restrictions) (Self-isolation) (England) (Amendment) (No. 2) Regulations 2021
The Committee consisted of the following Members:
Chair: † Siobhain McDonagh
† Allin-Khan, Dr Rosena (Tooting) (Lab)
† Atherton, Sarah (Wrexham) (Con)
† Baynes, Simon (Clwyd South) (Con)
† Brereton, Jack (Stoke-on-Trent South) (Con)
Cryer, John (Leyton and Wanstead) (Lab)
† Cummins, Judith (Bradford South) (Lab)
† Dorries, Ms Nadine (Minister for Patient Safety, Suicide Prevention and Mental Health)
† Double, Steve (St Austell and Newquay) (Con)
Dowd, Peter (Bootle) (Lab)
Fovargue, Yvonne (Makerfield) (Lab)
† Furniss, Gill (Sheffield, Brightside and Hillsborough) (Lab)
† Richards, Nicola (West Bromwich East) (Con)
† Sambrook, Gary (Birmingham, Northfield) (Con)
† Smith, Greg (Buckingham) (Con)
† Throup, Maggie (Lord Commissioner of Her Majesty's Treasury)
† Timms, Stephen (East Ham) (Lab)
† Trott, Laura (Sevenoaks) (Con)
Chloe Freeman, Committee Clerk
† attended the Committee
Third Delegated Legislation Committee
Monday 13 September 2021
[Siobhain McDonagh in the Chair]
Health Protection (Coronavirus, Restrictions) (Steps etc.) (England) (Revocation and Amendment) Regulations 2021
I can confirm that we are quorate. Before we begin, can I encourage Members to wear masks when they are not speaking? This is in line with current Government guidance and that of the House of Commons Commission. Please also give each other and members of staff space when seated and when entering and leaving the room. Members should send their speaking notes by email to firstname.lastname@example.org. Similarly, officials in the Gallery should communicate electronically with Ministers.
I beg to move,
That the Committee has considered the Health Protection (Coronavirus, Restrictions) (Steps etc.) (England) (Revocation and Amendment) Regulations 2021 (S.I. 2021, No. 848).
With this it will be convenient to consider the Health Protection (Coronavirus, Restrictions) (Self-isolation) (England) (Amendment) Regulations 2021 (S.I. 2021, No. 851) and the Health Protection (Coronavirus, Restrictions) (Self-isolation) (England) (Amendment) (No. 2) Regulations 2021 (S.I. 2021, No. 864).
The regulations lifted most of the legal restrictions when we moved to step 4 of the road map on 19 July and eased the self-isolation requirements from 16 August to allow those who are fully vaccinated and a number of other groups to be exempt from self-isolation if they are the close contact of a positive case. These are significant milestones in our country’s journey as we learn to live with the virus. We have certainly come a long way since the Prime Minister set out the details of the Government’s road map out of lockdown in February.
Moving to step 4 and easing a huge number of restrictions was a great progress. It is testament to the grit and determination of the public and to the expertise and dedication of all those involved in our country’s response to the virus and the phenomenal vaccination programme.
The Government’s road map charted a cautious approach to easing lockdown, guided by the data rather than the dates. When we moved to step 4 on 19 July, most restrictions enforced in law were replaced with guidance. Businesses are now open across all sectors. All remaining limits on social contact have been removed and there are no restrictions on how many people can meet in any setting. We are seeing our communities thriving again, with familiar social, sporting and community events returning to our English summertime. It was wonderful to spend treasured time with family, friends and loved ones without legal restrictions on our social contacts.
While we are enjoying those freedoms, we know that this is not yet a return to normal. The pandemic is not over, and the virus will remain part of our lives. We must continue to act carefully to protect ourselves and those around us. The test, trace and isolate system remains one of our best defences against the virus and it is one of the key ways in which we can protect ourselves, our loved ones and our communities.
Owing to the steady progress we have made and the tremendous success of the vaccination programme, we have been able to make important changes to ease the self-isolation requirements from 16 August while maintaining vital measures to reduce spread of the virus. The amendments to the self-isolation regulations that we are debating today allow those who are fully vaccinated and a number of other groups to be exempt from self-isolation if they are the close contact of a positive case. That includes an exemption for close contacts who can evidence that they are unable to be vaccinated for medical reasons. That is because we recognise that some groups are not able to be fully vaccinated.
The exemption further includes close contacts of those under the age of 18. We know the risk of covid-19 to children is very low and there are also unquantified harms to children’s educational, emotional and social outcomes as a result of self-isolation. We have ensured that the amendment also provides for an exemption for individuals who have been named contacts who have taken part in, or who are taking part in, the Medicines and Healthcare Products Regulatory Agency’s approved trial for covid-19 vaccines.
Although the requirement to self-isolate has changed for those groups, it is still important that the close contacts of a positive case act with caution. Close contacts who are exempt from self-isolation are advised to take a polymerase chain reaction test as soon as possible to check whether they have the virus. They are also advised to consider other precautions, such as wearing a face covering in enclosed spaces and limiting contact with others, particularly those who are clinically extremely vulnerable. It is important to remember that anyone who develops symptoms should self-isolate immediately and take a PCR test. Anyone, whether double vaccinated or not, who goes on to test positive for the virus is legally required to self-isolate.
The measures allow us to continue to manage the virus proportionately and effectively. We know that self-isolation can be difficult. I sympathise with respect to the burden and the challenges that self-isolation creates. Since September last year, the Government have provided councils with £280 million to provide support payments to those who may face financial hardship as a result of self-isolation. Between March and September this year, we provided up to £100 million to councils to offer practical support to those who most need it in the community. We know that thousands of people have benefitted from that support.
We continue to review the self-isolation regulations and guidance, and shortly we will update Parliament on plans for autumn and winter. Although we are undoubtedly in a better place than when we embarked on the road map out of lockdown in February, I echo my earlier statement that this is not yet a return to normal. We must all continue to act carefully and to follow the latest guidance to protect ourselves and those around us—for example, by getting tested when showing symptoms and self-isolating if required, ensuring good ventilation when meeting indoors, and getting the vaccine.
While the lifting of restrictions and the easing of some requirements to self-isolate have been welcomed by many, I know that some people may feel nervous, particularly those who are immuno-suppressed or immuno-compromised. We continue to bolster our vaccine wall of defence against the virus and to follow the advice of the Joint Committee on Vaccination and Immunisation. We are now offering vaccines to 16 and 17-year-olds and extensive planning for a booster vaccination programme is well under way.
This is the biggest and most successful vaccination programme this country has ever seen. It is a staggering achievement that over 80% of individuals aged 16 or over in the UK have received two doses of a covid-19 vaccine. It is estimated that the vaccines have so far directly prevented more than 143,600 hospitalisations. Estimates of the direct and indirect impact of the vaccination programme suggest that the vaccines have saved more than 105,900 lives.
As we enjoy our hard-fought-for freedoms, we can look to the future with a sense of optimism. However, we know that the autumn and winter months will be challenging. We cannot rule out the possibility of the Government needing to take further measures to manage the virus during periods of high risk, including this autumn and winter. We will, as far as possible, avoid reimposing social and economic restrictions, but that cannot be ruled out entirely as they might be needed. We continue to monitor the situation closely, informed by the latest data and scientific evidence, to ensure that the NHS does not face unsustainable pressure.
Finally, I am sure members of the Committee will join me in extending immense gratitude to all those involved in the vaccination and the test, trace and isolate programmes—the NHS, the social care sector and wider support services, including the many volunteers who have helped us get to this point and who continue to support our country’s response in this next phase.
It is a matter of regret that we are debating the regulations only now. It was essential to introduce them at the earliest opportunity, and we have always been clear that restrictions would be in place only for as long as they were needed. The content of each step of the road map has the prior approval of Parliament and we debated the oral statements setting out the shape of step 4, as well as that announcing the move to step 4. As ever, I welcome the scrutiny of Parliament and the valuable contributions of hon. Members to that end. I commend the regulations to the Committee.
What a pleasure it is to serve under your chairwomanship, Ms McDonagh.
At the time of restrictions lifting, we opposed, and still oppose, the decision to remove the requirement to wear a face covering indoors and on public transport. Risk of transmission inside a crowded bus or train will be incredibly high. Last week, the Office for National Statistics believed that one in 70 of us in England had covid. The capacity of a double-decker bus is about 70, and a full tube or train carriage can carry up to 140 passengers, which means that last week each full carriage could have contained two infected passengers, with little ventilation and no legal requirement to wear a mask.
With no requirement to wear a mask coming from the Government, mask-wearing has dropped considerably. However, people learning to drive and their instructors are still required to wear a mask inside cars, although we do not require people to wear masks on a crowded bus. That makes no sense.
The explanatory memorandum to the statutory instrument states:
“The rationale for revoking these regulations is that the success of the vaccination programme means that at Step 4 we can move away from strict legal restrictions and towards personal responsibility and informed judgement.”
What assessment has been made of the rates of infection in areas where it is still compulsory to wear face coverings on public transport—for example, here in London?
We supported the removal of some restrictions on gatherings, but the Government did not have to go so far, so fast. The announcement that all limits were being removed again came too late, meaning that businesses were left to scramble owing to confusing and contradictory advice. Ministers have passed the buck to businesses and individuals with vague and unclear guidance encouraging, but not mandating, the use of masks, as well as the NHS covid pass.
The Government’s explanatory document states:
“Our assessment of the risks is not fundamentally changed by new Variants of Concern”,
but what about the rate of deaths and hospitalisations? There is talk of an October lockdown. What impact have these changes had on the rate of infection? Bars and restaurants have resumed service as normal, but what public health assessment has been made of transmission rates since social distancing was scrapped and face coverings were deemed not to be necessary?
Due to the unpredictability of the virus, it would be negligent completely to remove the ability to reinstate any restrictions if required locally, so we are pleased that regulation 3 powers for local authorities are being extended. However, the Government must back up local authorities with a proper package of support should they impose restrictions. Allowing local authorities to limit the capacity of venues and allowing them to mandate certain social distancing measures may become essential in preventing localised spreads. That may not have seemed necessary over recent weeks, but with cases, deaths and hospital admissions all rising, some local authorities might be forced to impose measures and the Government must—absolutely must—support those businesses and councils.
With contact tracing now voluntary, and with the requirement to book a table before entering premises removed, we are in the dangerously perilous position of not really knowing who is entering venues. During the summer, there has not as yet been a requirement for further restrictions, but with the winter months closing in, this type of contact tracing might become invaluable in battling a fourth wave if we are indeed to avoid lockdowns.
Removing that requirement altogether has meant that its importance has been lost to most people, and reapplying it would be an uphill task. It must also be said that while contact tracing in establishments could have been used effectively to target specific outbreaks of the virus, we know the Government did not really use the data and instead relied on the test and trace app. For a multi-billion pound test and trace system, I would have expected far more for my money.
There is no longer a need for people to check in at bars and restaurants, but is there contact tracing data that can be shared with us? How many new cases of covid have had their contacts successfully reached? One of the most important aspects of any contact tracing system is ensuring that anyone identified as a close contact of someone with the virus self-isolates as a precaution. However, the roll-out of the vaccine coinciding with the reopening of the economy requires that to be adapted.
We supported removing from people who were double-vaccinated and had come into contact with someone with covid the requirement to self-isolate, unless they returned a positive test, but that could have been done sooner. The Government had no real logic behind their chosen date in August and they still cannot explain why they chose 16 August when Wales and Scotland had removed the requirement a week earlier, enabling thousands of non-infected people to get to work. Someone who has been double-vaccinated is far less likely to get a serious infection from covid, and transmissibility is reduced as well.
Paragraph 7.7 of the explanatory note to the self-isolation statutory instrument stated that
“public health modelling suggests that the rise in case numbers we are experiencing will have peaked by mid-August so introducing this change then will reduce the risk of transmission, hospitalisations and deaths.”
However, that was not the case. Instead, cases continued to rise. What further assessment has been made of case rates? Following the scrapping of self-isolation among the vaccinated, what assessment has been made of the direction of travel of such cases? There is also an exemption from self-isolation for children. We are still early in the school year, but what assessment has so far been made of the spread of covid in schools this term?
Although we will not oppose the regulations, our concerns regarding certain aspects of them have been put on the record. I hope the Minister can provide answers to my questions. Fundamentally, these decisions must be driven by data and science, not pressure groups and lobbyists.
This has been an incredibly difficult time for everybody, and we understand how challenging it has been for people to self-isolate and to manage work with their children at home, but we must state that we know cases are on the rise. It is incredibly difficult to predict how case numbers will proceed over the winter months, so I would welcome answers to my questions so that we can ensure that the public are kept as safe as possible.
I was trying to look up some of the more specific answers to questions, particularly the one about children as vectors, or transmitters, in education settings. I will write to the hon. Lady with that answer, particularly on young children, but as she knows, children in school settings are vectors rather more than they display infection themselves. However, there are more specific answers, and I will get the data and the numbers to her.
I thank everybody who has attended the debate and thank the hon. Lady for her thoughtful contribution. As I mentioned in my opening remarks, the move to step 4 of the Government’s road map out of lockdown and the easing of self-isolation requirements are significant achievements that have been welcomed by many across the country. We have charted a cautious approach to easing lockdown. Normally, when I am in this place putting forward restrictions, I am beaten down by the Opposition, so it is interesting to be easing restrictions while still having to deal, quite rightly, with the arguments on the other side.
We have charted a cautious approach and we have been guided by the data. We have always been guided by the data in everything we have done with the aims of avoiding a surge in cases putting unsustainable pressure on the NHS and saving more lives. That is, fundamentally, at the root of everything we have done throughout the pandemic. Moving to step 4 does not mark the end of the pandemic, and our test, trace and isolate system remains essential in tackling variants of concern and ensuring we are not putting unsustainable pressure on the NHS. The UK has conducted more than 274 million covid tests and reached more than 15.9 million people who either tested positive or were in contact with someone who had tested positive, who may otherwise have spread the virus.
Sensibly adapting the self-isolation regulations to allow those who are fully vaccinated and a number of other groups to be exempt from self-isolation if they are the close contact of a positive case is an important step as we learn to live with the virus. These changes ensure self-isolation is targeted on those who have the virus or who are most at risk.
Throughout the pandemic, our objective has been to protect lives and livelihoods, and that remains our priority as we face the months ahead. We have moved to a new phase of the Government’s response to the pandemic as the country learns to live with the virus. It will continue to circulate at home and abroad, and this winter covid-19, combined with a resurgence of influenza and other respiratory diseases, may cause additional strain on top of normal winter pressures on the NHS. As the Government set out in the guidance “COVID-19 Response: Summer 2021”, we may need to take further measures to manage the virus during periods of high risk, including this autumn and winter. It is the job of a responsible Government to make the contingency plans for such scenarios, and we are doing just that.
The Government are assessing the country’s preparedness for autumn and winter, and, as part of that, will consider whether to continue or to strengthen public and business guidance. We will, as far as possible, avoid reimposing social and economic restrictions, but those cannot be ruled out entirely if they are needed. We will update Parliament on plans for autumn and winter shortly, and we will of course continue to keep the data under review and monitor the latest available science. We have always been clear: restrictions would be in place for only as long as they were absolutely necessary. We will keep any remaining restrictions under close review and remove them when it is safe to do so.
I recognise that, for some, the easing of restrictions is worrying, particularly those who are extremely clinically vulnerable or otherwise at greater risk from the virus. The Government advise that people should remain cautious given the continued risk. This is not a return to normal, as I said in my opening remarks. While cases are high, everybody needs to continue to be cautious and to make informed decisions to manage the risk to themselves and to others. I think that speaks to the hon. Lady’s question about public transport and the wearing of face coverings.
I once again thank everyone for the sacrifices they have made over this period despite the hardships covid has imposed. Everyone has continued to act carefully and proportionately to manage the risks to themselves and to others. I would like to take a moment to reflect, as I did earlier, on the tremendous efforts and achievements of everyone involved. I commend the regulations to the Committee.
Question put and agreed to.
HEALTH PROTECTION (CORONAVIRUS, RESTRICTIONS) (SELF-ISOLATION) (ENGLAND) (AMENDMENT) REGULATIONS 2021
That the Committee has considered the Health Protection (Coronavirus, Restrictions) (Self-isolation) (England) (Amendment) Regulations 2021 (S.I. 2021, No. 851).—(Ms Dorries.)
HEALTH PROTECTION (CORONAVIRUS, RESTRICTIONS) (SELF-ISOLATION) (ENGLAND) (AMENDMENT) (No. 2) REGULATIONS 2021
That the Committee has considered the Health Protection (Coronavirus, Restrictions) (Self-isolation) (England) (Amendment) (No. 2) Regulations 2021 (S.I. 2021, No. 864).—(Ms Dorries.)
Money Laundering and Terrorist Financing (Amendment) (No. 2) (High-Risk Countries) Regulations 2021
The Committee consisted of the following Members:
Chair: Sir Graham Brady
† Aiken, Nickie (Cities of London and Westminster) (Con)
Ali, Rushanara (Bethnal Green and Bow) (Lab)
† Antoniazzi, Tonia (Gower) (Lab)
† Baker, Duncan (North Norfolk) (Con)
† Coutinho, Claire (East Surrey) (Con)
† Fell, Simon (Barrow and Furness) (Con)
† Glen, John (Economic Secretary to the Treasury)
† Grant, Peter (Glenrothes) (SNP)
† Griffith, Andrew (Arundel and South Downs) (Con)
Gwynne, Andrew (Denton and Reddish) (Lab)
† Holmes, Paul (Eastleigh) (Con)
† McFadden, Mr Pat (Wolverhampton South East) (Lab)
Osamor, Kate (Edmonton) (Lab/Co-op)
† Owen, Sarah (Luton North) (Lab)
† Russell, Dean (Watford) (Con)
† Rutley, David (Lord Commissioner of Her Majesty's Treasury)
† Vickers, Matt (Stockton South) (Con)
Yohanna Sallberg, Committee Clerk
† attended the Committee
Second Delegated Legislation Committee
Monday 13 September 2021
[Sir Graham Brady in the Chair]
Money Laundering and Terrorist Financing (Amendment) (No. 2) (High-Risk Countries) Regulations 2021
I beg to move,
That the Committee has considered the Money Laundering and Terrorist Financing (Amendment) (No. 2) (High-Risk Countries) Regulations 2021 (S.I. 2021, No. 827).
May I say what a pleasure it is to serve under your chairmanship, Sir Graham?
The Government recognise the threat that economic crime poses to the UK and are committed to combating money laundering and terrorist financing. Illicit finance causes significant social and economic cost through its links to serious and organised crime. It is a threat to our national security and risks damaging our international reputation as a fair and open rules-based economy. It also undermines the integrity and stability of our financial sector and can reduce opportunities for legitimate business in the UK. That is why the Government are focused on making the UK an inhospitable environment for illicit finance. We have taken significant action to tackle money laundering and terrorism financing and have strengthened the whole system response to economic crime.
Underpinning those efforts are the money laundering regulations—a key part of our legislative framework—that set out a number of measures that certain businesses must take to combat money laundering and terrorist financing. They include the need for businesses to identify and verify the people and organisations with whom they have a business relationship or for whom they facilitate transactions. In addition, they require that financial institutions and other regulated businesses conduct additional checks or enhanced due diligence on business relationships and transactions involving high-risk third countries that have been identified as having strategic deficiencies in their anti-money laundering and counter-terrorism financing regimes and posing a significant threat to the UK’s financial system. The statutory instrument under discussion updates the list of countries that are specified as high risk in the money laundering regulations.
At present, the UK’s list of high-risk third countries specified in the money laundering regulations mirrors that identified in February by the Financial Action Task Force, the global standard setter for anti-money laundering and counter-terrorist financing. The Financial Action Task Force carries out periodic reviews and regularly updates its list. As a result, following the conclusion of a FATF plenary in June this year, it updated its public list of jurisdictions with strategic deficiencies to reflect changing risks and circumstances in these jurisdictions and in the global economy.
This instrument will therefore amend the money laundering regulations to update the UK’s list of high-risk third countries to mirror the latest FATF public list, ensuring that the UK’s list is responsive to the latest threats emanating from high-risk countries with inadequate counter-illicit finance systems and that the UK remains at the forefront of global standards on money laundering and terrorist financing. This update is an integral part of helping to protect our national security and the UK’s international reputation, businesses and financial systems from money launderers and terrorist financiers.
I thank Members for examining this important measure that will update the UK’s high-risk third countries list. Businesses that fall under the scope of the money laundering regulations and that deal with such countries will be required to take extra security measures. This amendment will enable the money laundering regulations to continue to work as effectively as possible to protect the UK’s financial systems. It will allow the UK to continue to play its full part in the fight against economic crime and I hope that colleagues will join me in supporting it.
Thank you for your chairmanship today, Sir Graham.
I am grateful for the Minister’s explanation of the measure and of the criteria for including countries on the list, which is updated periodically and relies heavily on the work of the Financial Action Task Force. We shall not, of course, oppose this today because we believe that it is important to have the strongest anti-money laundering regime and to take the strongest measures possible. That is very much in the public interest. It is not easy, because regulators have to keep track of evolving practice among those who try to get round the law.
There is a particular duty on the UK to take the issue seriously given the size and global reach of our financial services sector. Anything that suggest slackness on our part—anything that involves UK institutions and anything where it appears that the regulators have taken their eye off the ball—is bad for public confidence in the UK’s financial services sector. Sadly, UK institutions have been named quite a lot in recent years in stories about illicit finance.
We see from the regulations that the picture changes over time, with some countries coming off the list and others being put on to it. For example, Ghana has been removed from the list, but Haiti, Malta, the Philippines and South Sudan have been added. Malta is an EU member state. One would hope that high standards of governance and supervision were in place. Can the Minister explain further why Malta has been added to the list?
More notably, Afghanistan is not on the list. Is that because the measure was drafted in July, before the Taliban takeover? If so, have the Government taken measures on money laundering and terrorist financing since the Taliban assumed control on 15 August? A brief look at the Government’s consolidated list of financial sanctions targets shows that there are 135 Afghans on it, a number of whom have assumed positions of significant power in the Afghan Government. Sirajuddin Haqqani, the new Afghan Government’s interior Minister, is on the UK consolidated sanctions list. He is also on the FBI’s most wanted list, because—according to Reuters—of his links to suicide attacks and al-Qaeda. There are others, too.
How do the Government intend to respond to the formation of the Afghan Government and money laundering and terrorist financing? We do not want to do things that hurt the Afghan people, but what will the Treasury, regulators and, indeed, the Government as a whole do to ensure that funds are not channelled to terrorist organisations as a result of the Taliban takeover?
It is a pleasure to serve under your chairmanship, Sir Graham.
I will certainly support the statutory instrument, although like the shadow spokesperson, the right hon. Member for Wolverhampton South East, I have some questions and observations. It is absolutely right that decisions are based on the best economic intelligence that can be gathered and, if possible, made on a global basis. It does not work if one or two countries apply sanctions but no one else does, any more than it does if one or two countries dodge the sanctions that everyone else tries to apply. It is important to ensure that our allies throughout the world work with or are exposed to the same rules as we are.
When we last debated money laundering regulations I mentioned something that I shall mention again because it should give us all a bit of a kick. Of the 24 high-risk third party countries on the list, seven are members of the British Commonwealth, including one, Zimbabwe, where there are historical concerns about the rule of law as well as money laundering. One country on the list is a British overseas territory.
In some of those countries, the problems with the lack of proper financial regulation—with being seen worldwide as havens for all kinds of dodgy financial dealings—have been present since the days of direct rule and the British empire. The problems were created 100 years ago, or perhaps more recently, and we are now trying to clear up the mess left behind by our imperial forefathers. It is as good an example as any of the maxim that, in international affairs, what we do to other people we very often end up doing to ourselves.
The right hon. Member for Wolverhampton South East mentioned one or two examples that are clearly going in the wrong direction. We cannot afford to be complacent. Many Governments and widely respected non-governmental organisations have been saying for a number of years that they are concerned about the direction in which financial regulation in the United Kingdom is going. Perhaps more accurately, they are concerned that it is not going in the right direction as fast as the bad guys are trying to pull in the wrong direction.
The Government consultation on their company regulation contained a lot of positives, and I certainly look forward to seeing what draft legislation emerges from it. The response that the SNP submitted in 2019 included two key points. The United Kingdom needs a robust and transparent system of company registration, which we do not have just now. The system of company registration is not working. It must be crystal clear who owns companies, who benefits from them and who is pulling the strings.
We need other legislation on Scottish limited partnerships, which we know have been used and abused to facilitate money laundering and all the criminal and terrorist activities that it supports.
We will support the regulations today, but, as I heard myself saying last week—doubtless I will hear myself saying the same on other financial regulation legislation over the coming weeks and months—this is a small step in the right direction that does not go nearly far enough. Will the Minister tell us when the substantial weaknesses in company registration legislation will be sorted out? My concern is that if we are not careful we could start to see the United Kingdom appear on some people’s suggestions for additions to, if not a red list, an amber list. Give the extent to which the United Kingdom’s economy and, indeed, Scotland’s economy rely on our reputation as a trustworthy place to do financial business, we cannot afford to take that risk.
I am happy to address Members’ points.
It is the Government’s view that the amendment will ensure that UK legislation remains up to date and continues to protect the financial system from the threat by jurisdictions with inadequate money laundering and terrorist financing. The amendment enables the UK to remain in line with international standards on money laundering and terrorist financing, allowing it to continue to play its full part in the fight against economic crime. I agree with the right hon. Member for Wolverhampton South East and the hon. Member for Glenrothes about the need to retain high standards in our financial services regulation—the consistent duty I have put on our regulators in conversations with them, week in, week out.
The right hon. Member for Wolverhampton South East was absolutely right when he said that, because of the size and sophisticated nature of financial services in the United Kingdom, keeping to those high standards will always be an imperative for us. He asked me to comment on the listing of Malta and Afghanistan. At the June 2021 FATF plenary, FATF collectively agreed to include Malta on its list of jurisdictions under increased monitoring. As this is one of the FATF public lists that the UK list mirrors, Malta will be added to the UK’s list of high-risk third countries. The outstanding issues that Malta must address are outlined in FATF’s publicly available statement.
The hon. Member for Glenrothes made a point about this country’s past. FATF’s rules and processes are searching, rigorous and extensive. The British Government receive extensive lobbying on these matters but we defer to the rigour of the process, no matter how uncomfortable it might be given the strong relationships we might otherwise have. Part of today’s upgrading following the June decisions goes ahead of where the EU is on a number of these issues, and I am pleased that we are applying the highest standards.
The right hon. Member for Wolverhampton South East made a number of points about Afghanistan and the challenges that exist. Afghanistan is not currently identified on any of FATF’s public lists, but it is important to note that the money laundering regulations require enhanced due diligence in a range of situations that present a high risk of money laundering or terrorist financing, not just where a transaction or business relationship involves a country that is listed as high risk. When assessing whether there is a high risk of money laundering or terrorist financing, the regulated sector must take a number of factors into consideration, including geographical risk where countries have been identified by credible sources and alerts from supervisory and regulatory bodies.
There are at present various sanctions in place in relation to Afghanistan that include members of the Taliban. Targeted sanctions impose an asset freeze, including making directly or indirectly available funds or economic resources to or for the benefit of designated individuals or entities. Under the UN’s existing Afghanistan sanctions regime, 135 designated individuals are linked to the Taliban or the Haqqani network—which as Members will know is a UK-designated and proscribed organisation closely linked to the Taliban—and four Afghan Hawala businesses. Several other designated groups and individuals with links or possible links to the Taliban are also designated under the UN al-Qaeda/Daesh regime, UNSCR 1267.
As anti-money laundering and counter-terrorism financing supervisors, the Financial Conduct Authority and HMRC reminded obliged firms in their recent alerts about potential financial crime risks from Afghanistan and about their obligations to ensure that they appropriately monitor and assess transactions with Afghanistan to mitigate the risk of their firms being exploited for money laundering or terrorist financing purposes and to implement sanctions screening. Similarly, the Office of Financial Sanctions Implementation, which sits within the Treasury, issued an alert reminding businesses that UN sanctions are already in place against individuals and entities associated with the Taliban. The alert advised businesses to exercise caution given the changing environment and reminded them of the continued existing obligations to carry out customer due diligence and implement sanction screening.
FATF will continue to analyse countries at risk and will likely look at those matters during its next plenary, which I believe is in October. The United Kingdom will play an active part in that conversation.
If we were to think of a country at greatest risk of being used for terrorist financing, Afghanistan and its new Government would be high in our thoughts. The Minister tells the Committee that the list is based on FATF’s work. I understand that, but presumably the Government have the power to go beyond FATF and say, “We think Afghanistan should be on the list.” Is there anything to stop the Government adding Afghanistan to the list, according to their own timetable, before FATF looks at the issue again?
The purpose of this statutory instrument is to update according to the last assessment. We would not want, as a response to immediate events and without analysis or rigour, to add additional countries. I have explained at some length the considerable sanctions regime against proscribed individuals and the upgrading of the advice on its obligations to the regulated sector from HMRC and the FCA. Other jurisdictions such as the EU are not even upgraded to the list that I hope the Committee will agree to today. We do not rule anything out in the future, but we believe that FATF is rigorous. Indeed, the UK experienced rigorous analysis in 2018. We stand by the assessment and will see what it will do in October.
The hon. Member for Glenrothes mentioned wider issues with Scottish limited partnerships. The registration numbers thereof have diminished significantly recently, but as this is a BEIS competence I hope he will not mind my writing to him on it. I hope that satisfies the Committee.
Question put and agreed to.