Public Authorities (Fraud, Error and Recovery) Bill

Baroness Finn Excerpts

Report stage
Wednesday 15th October 2025 Lords Chamber

[Baroness Kramer (LD)]

My Lords, I have tabled Amendments 1 and 20 in this group to raise again the issue of whistleblowing. Sadly, I do not think it is necessary to repeat in any detail why the existing whistleblowing framework is completely inadequate. We have to look only at the scandals of the Post Office, contaminated blood, Letby, the Hillsborough cover-up, the fake costings for HS2, the mis-selling of PPI, mini-bonds and now car finance. Those are just a few of the very real outrages and tragedies that could have been nipped in the bud if we had had a system that, in actuality and effectively, protected whistleblowers who spoke out and ensured the investigation of their disclosures. Most importantly, the victims of these many scandals would have been spared, but also the taxpayer would have been protected from huge compensation payouts.

I believe strongly that the Public Sector Fraud Authority, sitting as it does under the Cabinet Office and with its investigative powers, is very well placed to be the hub of a proper framework—I would call it an office of the whistleblower, but that is not a precious issue—and at least to act as a hub for whistleblowing protection and investigation across the whole of the public sector. It could provide proper guidance to government departments and agencies, set standards for proper whistleblowing protection and redress, ensure investigation when appropriate, and provide the consistency, clarity and ease of use that are essential to effectiveness.

I realise that the amendments I have tabled are inadequate to this task, and what I seek from the Government is a conclusion that there is real progress in this direction. The Government have increasingly recognised the importance of the issue, and the Minister herself—I have to give her real credit—has commendably talked about the importance of whistleblowing. Collectively, the House has made progress in the Employment Rights Bill on limiting the abuse of non-disclosure agreements and in the Armed Forces Commissioner Act in developing a whistleblowing framework for the commissioner which will possibly extend to all of defence.

In the context of fraud and whistleblowing, we currently await the second part of the Fisher review of disclosure and this Bill contains provisions for an independent review of the Minister’s functions, so there are tools available to the Government. For this Government, as for any other, there is always the risk that, without change, new scandals will occur and those would then be laid directly at their door. Nobody wants that. This is an area where all parties should be co-operating and not competing. I look forward to hearing the Minister’s reply and hope to conclude that progress is seriously being made.

[Baroness Finn (Con)]

My Lords, I begin by thanking both Ministers opposite, and noble Lords from across the House, for their engagement with us on the substance of this Bill since we entered Committee. We have had some very valuable discussions and I welcome that the Government have approached this with a view to compromise and listening to noble Lords from across the House on the Bill. I hope we can conclude Report in the same spirit and I look forward to the discussions we shall have in these sessions.

We on these Benches welcome that we are starting Report by discussing an important issue, and I thank the noble Baroness, Lady Kramer, for bringing forward these two amendments. Both amendments speak to a common principle that individuals who come forward with evidence of wrongdoing should be able to do so safely, confidently and with the assurance that their actions will lead to meaningful action rather than personal detriment.

The decision to do the right thing and report wrongdoing is far from an easy one for anyone to make. To come forward with evidence of fraud is often to put oneself at considerable risk of losing employment, damaging one’s reputation or straining relationships. If we expect people to do the right thing then it is incumbent on us to ensure that the system does right by them in return. Whistleblowers are very often the first line of defence against fraud. They can identify irregularities and provide information that would otherwise remain hidden—information that the Public Sector Fraud Authority will need in order to act swiftly and effectively. That is why it is so important that individuals know that they will be listened to, supported and protected. Only then will they feel able to come forward and only then will we be able to tackle fraud before it escalates.

In addition to the channels set out in Amendment 1, this principle links directly to the second amendment before us, Amendment 20, which proposes the establishment of an office of the whistleblower for public sector fraud. The purpose of such an office would be to oversee and safeguard the process of whistleblowing, to ensure that concerns are acted on and that those who raise them are not left exposed or ignored. We understand that the noble Baroness has likely brought this proposal to emphasise the importance of the issue rather than to suggest this particular structure as the final answer. We shall, of course, be very interested to hear how the Minister will meet the challenge set on this question.

As the noble Baroness, Lady Kramer, set out, whistleblowers can operate effectively only when they know that their efforts will not be in vain, that the authorities will respond and that the risks they take will not go unacknowledged. In the specific context of this Bill, that raises a very practical question that relates to the amendment we have brought to Clause 2. If a whistleblower were to bring actionable evidence of fraud to light, would the Public Sector Fraud Authority be able to act on it directly, or would it still have to wait for a formal invitation from the relevant department or authority before beginning an investigation? Our reading of the Bill suggests the latter, and if that is the case then the system risks leaving whistleblowers stranded, even when they have provided precisely the sort of information that this legislation is intended to uncover.

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Moved by

[Baroness Finn]

2: Clause 2, page 2, leave out line 10 and insert—
“whether at the request of that public authority or, where the Minister considers it necessary in the public interest, on the Minister’s own initiative.”Member's explanatory statement
This would enable the Minister for the Cabinet Office, through the PSFA, to undertake proactive investigations or recovery actions in respect of suspected fraud against a public authority, without requiring a prior request from that authority, while preserving the authority’s own fraud functions under subsection (5).

[Baroness Finn (Con)]

My Lords, I began by thanking the noble Baronesses opposite for their constructive engagement with us on the Bill. Our meetings with the Ministers have been genuinely useful, and I welcome the spirit of good faith and collaboration with which the Minister has approached our discussions. Tackling fraud against the public purse is a shared ambition across this House and it is in that constructive spirit that we have brought forward the amendments in this group.

As drafted, Clause 2 provides that the Minister may

“investigate or take enforcement action in respect of suspected fraud against another public authority … only at the request of that public authority”.

In other words, the Public Sector Fraud Authority can act only if invited to do so; indeed, that was the word used by the noble Baroness in Committee. This is an extraordinary limitation to place on an organisation whose very purpose is to root out fraud across government. The Bill seeks to confer considerable powers of investigation and enforcement upon the Cabinet Office, yet the exercise of these powers is ultimately hamstrung by the restriction in Clause 2. The effect is to create a PSFA that is at once empowered and yet toothless: an authority that has wide-ranging powers on paper but which cannot use them unless those potentially under scrutiny choose to permit it.

It cannot be right that a public authority suspected of fraud has the power to decide whether to be investigated. To rely on departments or agencies to invite in the PSFA to look at themselves or their work is, frankly, far too weak. There are obvious disincentives: the reputational risk, the potential embarrassment and the possibility of drawing attention to failings that might otherwise have gone unnoticed. As my noble friend Lord Maude of Horsham notably observed in Committee, assuming that departments will voluntarily expose their own shortcomings is a triumph of hope over experience.

If we are serious about protecting the taxpayer, the PSFA must be able to act proactively—to initiate investigations where credible concerns arise and not to wait passively for a polite invitation that may never come. I have been in government and I know how these things work. We cannot rely on good will; we must be both forthright and proactive in tackling this issue, which is an offence against every single person in this country.

Fraud against the taxpayer is not a matter to be settled or not by an informal phone call between Permanent Secretaries, as we were told could currently happen. Such a situation must be backed up by a statutory mechanism that ensures action is taken swiftly and decisively. Of course, such discussions can and should happen in the first instance, but there needs to be a way to compel such action if necessary. Our amendment would therefore enable the Minister for the Cabinet Office, through the PSFA, to undertake proactive investigations or recovery actions in respect of suspected fraud against a public authority on their own initiative, where it is in the public interest to do so. It would preserve the authority’s own internal fraud functions under subsection (5) but would finally give the PSFA the power it needs to do its job properly.

This amendment is not about centralising control or creating a culture of interference. It is about closing a glaring loophole, one that every complacent official and every fraudster will otherwise see coming a mile off. It is about ensuring that when the PSFA becomes aware of fraud that awareness marks the beginning of an investigation and not the point at which the system grinds to a halt while waiting for consent to be granted.

Alongside this, and in the same spirit of strengthening accountability, we have tabled a second amendment—one which we raised in Committee and return to today—as we believe the Government should take this opportunity to outline how they are working to create a counterfraud duty and culture across public authorities. Amendment 19 would require that, where a recovery made under Clause 10 exceeded £50,000,

“the public authority on whose behalf the amount was recovered must conduct an internal review into the circumstances giving rise to that recovery”

and provide that review to the Minister within three months of completion.

This is a practical, proportionate proposal to ensure that public bodies learn from their mistakes. It seeks to prevent the creation of a pass-the-buck-to-the-PSFA mentality. The PSFA cannot and should not become a convenient dumping ground for departmental failures. Fraud and error often originate within the systems and processes of individual departments. Responsibility for preventing and detecting it must therefore remain with them. I hope, in her remarks on this Amendment 19, that the Minister can set out to this House how this culture is being created, and how authorities are going to be held accountable for the mess in their own houses without simply leaning on the PSFA.

This is a big opportunity for us to get this right. If we want to tackle fraud, then we cannot create a mighty but toothless body with expansive powers on paper but which has no power to go after fraud when it should. We risk creating a situation in which the PSFA is legally unable to tackle fraud, and where it goes unchecked when it is known about but not formally referred to the PSFA. The noble Baroness may stand up and say that she expects many cases to be referred to the PSFA, but this misses the central point, which is that the PSFA must be able to tackle all fraud of which it becomes aware and can have a role in stopping. It is not a question of which cases are referred to the PSFA, but which cases will be missed because the PSFA was not invited to go in after it. This is simply not good enough. We must be really clear now in giving the PSFA the power to tackle wrongdoing proactively. I beg to move.

[Lord Vaux of Harrowden (CB)]

My Lords, I speak very briefly in support of Amendment 2. Before I start, I would like to echo the words of the noble Baroness, Lady Finn, about the exemplary engagement on this Bill, which has been extremely constructive. I am very grateful to both noble Baronesses for that.

The Bill as it is currently written creates a range of powers for the Minister of the Cabinet Office to investigate fraud against public authorities and to recover amounts, but the Minister can use those powers only in relation to other public authorities if requested to do so by that public authority. That does seem somewhat perverse. It is not uncommon for those who manage organisations to hide the fact that they have been subject to fraud, because they could be criticised for allowing that fraud. We could have a situation where the Minister has reason to believe that a public authority has been the victim of fraud—perhaps a whistleblower has tipped them off, as in the last group—but, despite having reasonable suspicion, the Minister would not be able to use these new powers. I do not see how that makes sense. If these new powers are to be effective in reducing fraud, it must make sense that the Minister can use them in any situation reasonably considered to be in the public interest, not only when the public authority requests them.

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[Baroness Anderson of Stoke-on-Trent (Lab)]

My Lords, fraud against the public sector takes money away from vital public services, enriches those who seek to attack the Government and damages the integrity of the state. This Bill is part of the Government’s response to this urgent and challenging problem. The Bill gives functions and powers to the Minister for the Cabinet Office, which will be exercised by authorised officers and investigators based in the Public Sector Fraud Authority.

I hope it will assist your Lordships’ House if I remind noble Lords of the PSFA’s mission. The PSFA is the UK Government’s centre of expertise for the management of fraud and associated error against the public sector. It leads the Government’s counterfraud function, which brings together the approximately 16,000 people who work in government departments and public bodies to fight fraud. The standards and guidance that the function creates, led by the PSFA, must be used in central government and can be used more widely in the public sector and beyond to improve the robustness of how we understand, prevent and respond to fraud.

These two amendments would make significant changes to the Government’s intention in bringing forward this Bill on how the PSFA works. They would change the impact of the Bill and are unnecessary to be put into law, so we cannot accept them.

On Amendment 2, the noble Baroness, Lady Finn, offered a version of this amendment in Grand Committee that simply deleted line 10, which I resisted because removing that line without putting something else in its place would have created uncertainty and potentially conflicted with the preservation of public authorities’ own fraud functions in Clause 2(5). It is clear this draft has been influenced by the debate on the original, and I thank the noble Baroness for it; however, the new version goes further and dramatically changes the impact of the Bill.

Amendment 2 would create an extensive new power for the Minister for the Cabinet Office and change the relationship between the PSFA and the public authorities it works with. The Government’s intention is that the PSFA offers a public sector fraud service, collaborating with public authorities which have been attacked by fraudsters to take action to investigate, enforce and recover the funds. Collaboration is vital in the Government’s fight against fraud. Noble Lords will be aware that last month the Government announced that, in the previous 12 months since April 2024, over £480 million was prevented from going into fraudsters’ pockets. Driving this kind of cross-government collaboration is what the PSFA is for. We can do more, which is why we need the Bill, but the PSFA is already working.

I firmly believe that the normal mechanisms of government can ensure that counterfraud co-operation happens, as it is already happening in the work of the current pilot unit in PSFA. In issues of national importance, there will also be some moral and public pressure for something to be done, so I believe it is not necessary for the Minister to have a directive power in law to investigate on their own initiative. We truly believe that the collaborative approach outlined in the Bill combined with the normal operations of government will ensure the PSFA has the access it needs.

The definition of public authority in Clause 71 is broad and this amendment would affect different public authorities differently. For central government departments, it would mean that a Minister below Secretary of State level could direct and override Secretaries of State. For local authorities, the amendment would mean a new power for central government to take over a responsibility without their consent. The Local Government Act 1999 already has powers to this effect, and we do not want to create a new one specifically for fraud.

Amendment 19 would require departments to conduct an internal review if, following a PSFA investigation, it is confirmed that they have lost more than £50,000 to overpayment or fraud. All losses on this scale should already be investigated and reported on. There are established audit, assurance and reporting processes for this. In addition, the facts of this case would already have been established by the PSFA, and learning taken from it would be shared across government to aid the prevention of fraud. This amendment would create an extra burden on the department and replicate the work of the PSFA. It is unnecessary, as its core aim will be addressed through other activities. Therefore, after my very persuasive arguments, I encourage the noble Baroness, Lady Finn, to withdraw her amendments.

[Baroness Finn (Con)]

I thank the Minister for her incredibly persuasive arguments. We are clear that this is an unacceptable settlement if the PSFA can act only if invited by the very body that may have failed. That is not a system of scrutiny; it is an invitation to inertia. It cannot be right that officials in a department where fraud is suspected should have the power to decide whether to be investigated. The DWP does not wait to be invited before it goes after benefits cheats, and there is no reason why public officials should be held to a different standard.

The Government are proposing to create an authority with wide powers on paper but no real agency in practice—a watchdog told to bark only when asked. In short, it should be called out for what it is: a farce. Fraud against the taxpayer is not a matter for polite phone calls between Permanent Secretaries; it demands action that is statutory, swift and unambiguous. When credible evidence of fraud arises, that must be the starting gun for any investigation, not the moment the system looks away.

Our amendment gives the PSFA the ability to act proactively, with proper safeguards, wherever fraud occurs. If we are serious about protecting public money, we cannot design a system that waits to be asked before doing its job. I am not satisfied that the response from the Government meets the conditions set out, and therefore I want to test the opinion of the House.

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Moved by

[Baroness Finn]

3: Clause 3, page 3, line 9, at end insert—
“(4A) Where an information notice names or describes a person in accordance with this section, the notice must include a clear statement that the person specified is not necessarily guilty of the suspected fraud.”Member's explanatory statement
This amendment would ensure information notices issued to banks and financial institutions include a clear statement that the person to whom the information relates is not necessarily guilty of suspected fraud.

[Baroness Finn (Con)]

My Lords, I will speak to Amendments 3 and 4, tabled in my name and that of my noble friend Lord Younger of Leckie. Both concern the information-gathering and information-sharing powers in this Bill, and both are designed to ensure that those powers are exercised with fairness, clarity and restraint.

The first amendment to Clause 3 would require that any information notice issued to a bank or financial institution includes a clear statement that the person named or described in that notice is not necessarily guilty of the suspected fraud. This is an important safeguard. As noble Lords will recall, Clause 3 enables investigators to issue information notices to banks when there is a reasonable suspicion of fraud. That is a proper and necessary power which is central to the operation of the Bill, and we do, of course, accept that. However, it is equally vital that the use of that power does not inadvertently imply culpability on the part of the individual concerned. Particularly in the early stages of implementation, when departments and financial institutions are still adjusting to these new processes, there is a real risk that an information notice could be misinterpreted as a formal accusation of wrongdoing. A simple, clear statement of non-culpability within the notice would prevent that risk. It would protect innocent individuals from reputational harm, ensure that they are not subject to debanking or any action from the side of the bank, ensure transparency in the use of investigatory powers, and demonstrate that the Government are determined to act fairly as well as firmly in the pursuit of fraud.

This is a small addition, but one with significant practical effect. What may seem a technicality in legislation can have a tangible effect on people in the real world—those who will be affected by the words we use and that we approve in this Bill. Clarity on this question would be a small change for the Government, but it could avoid risking some serious and damaging circumstances for those outside this place who have done nothing wrong, but who may nevertheless be presumed to have done so without the sort of clarifications we are suggesting. We therefore hope the Government will look closely at how such a clarification might be built into the final version of the Bill.

The second amendment, to Clause 5, concerns the disclosure of information once it has been gathered. As the Bill stands, Clause 5 allows the Minister to disclose information to another person for the purposes of exercising the powers in the Bill, but it gives no definition of or limitation as to who that other person might be. That is an extraordinarily broad formulation. Our amendment would simply require the Secretary of State to specify, by regulations, the persons or categories of persons to whom such information may be disclosed. This would provide a transparent and accountable framework that allows for flexibility but still ensures that Parliament has visibility of how and where sensitive data can be shared.

We are not seeking to obstruct the legitimate flow of information between public bodies. On the contrary, we recognise that effective information exchange is essential to combat fraud across the public sector, but we must ensure that these powers are not open-ended. We trust the present Minister to use them responsibly, but as noble Lords have often reminded us, we are legislating for future Ministers and Governments, and the safeguards we build in now will protect individuals for years to come.

These are not amendments on which we intend to divide the House. We bring them back to ensure that these important issues are not lost as the Bill progresses, that the Government meet the challenge they raise, and that appropriate assurances or refinements are provided before the Bill leaves this House. Both proposals are constructive. One protects individuals from being unfairly stigmatised when information about them is sought; the other ensures that personal information, once obtained, can be shared only within clear, regulated limits. Together, they speak to a single principle: that strong powers must always be matched by strong safeguards. We therefore hope that the Minister will take these concerns in that spirit and consider how best to address them as the Bill moves forward. We look forward to hearing her response. I beg to move.

[Lord Vaux of Harrowden (CB)]

My Lords, I rise briefly to add my support for Amendment 3, which would require any information notice to include a statement that the notice does not imply that the person named is guilty of fraud. This is important because a bank that believes a person is guilty of fraud must take actions that may include closing or freezing accounts, issuing suspicious activity reports, and so on.

This has been an area of much discussion as the Bill has gone through Committee, and I know that the financial services industry has raised a number of concerns. Many of those concerns have been dealt with by amendments tabled by the Minister, but this amendment would put it beyond doubt. It adds no onerous obligations, so I urge the Minister to accept it.

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[Baroness Anderson of Stoke-on-Trent (Lab)]

My Lords, I appreciate the noble Baroness, Lady Finn, bringing forward these amendments again. I find myself agreeing with the concerns outlined by the noble Baroness and other Members of your Lordships’ House. I reassure all noble Lords that we are already undertaking this work, and that the safeguards are in place.

On Amendment 3 and the issue raised by the noble Baroness, Lady Fox, we will be including specific information in guidance for authorised officers to ensure that information notices advise the information-holder that the investigation is ongoing, and no inference should be drawn that the individual specified on the notice is guilty. This amendment is therefore not required as it is already our intention to do this, and it will be achieved in guidance.

Turning to Amendment 4, I again assure the noble Baroness, Lady Finn, and other Members of your Lordships’ House that I agree with the intention of the amendment, which is why there are already safeguards in the Bill that restrict the disclosure of information. Clause 5 details that:

“Information can only be disclosed for the purpose of exercising the core functions”.


This restricts to whom and for what purpose the information can be disclosed. However, also including a prescriptive list of persons who can have information disclosed to them would further restrict the intent of the clause and the effectiveness of its scope in exercising the core functions detailed in Clause 1 of the Bill.

I hope to further reassure noble Lords that the PSFA’s enforcement unit would also have memoranda of understanding for each person it would be sharing information with, as well as maintaining a data protection impact assessment to ensure that this information is shared and held in adherence to data protection legislation. We have taken every step to ensure that there are appropriate safeguards in the disclosure of information, while balancing this with making the powers relevant and effective for an investigation. I hope that this reassures noble Lords and that the noble Baroness will withdraw her amendment.

[Baroness Finn (Con)]

My Lords, I am grateful to the Minister for her response, to the noble Lord, Lord Palmer, for his support, and to the noble Lord, Lord Vaux, and the noble Baroness, Lady Fox, for their support for Amendment 3.

These are, on the face of it, small and technical matters, but they go to the heart of how the Bill will operate in practice. The smallest drafting choices, the subtlest omissions, can have real consequences for individuals caught up in these processes. We cannot allow the system to treat people as wrongdoers when nothing has been proven or concluded. The language of the Bill must make that absolutely clear. What may seem a flippant technicality in this Chamber can, in the real world, determine whether someone is wrongly stigmatised, denied banking services or placed under suspicion without cause. That is why these details matter, because fairness, clarity and restraint are not afterthoughts; they are the foundation of public confidence in the powers that this Bill creates. I thank the Minister for her engagement and hope that, as the Bill progresses, these small but important safeguards might be reflected in the final drafting. On that note, I beg leave to withdraw the amendment.

Amendment 3 withdrawn.

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Moved by

[Baroness Finn]

5: Clause 7, page 5, line 22, at end insert—
“(5) Within six months of the day on which this section comes into force, the Minister must prepare and publish guidance setting out the process by which authorised investigators are appointed in accordance with section 7(3).”Member’s explanatory statement
This amendment clause would require the Minister to set out the process by which authorised investigators are appointed in statutory guidance.

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[Baroness Finn (Con)]

My Lords, this amendment, tabled in my name and that of my noble friend Lord Younger of Leckie, seeks to insert a new subsection in Clause 7 requiring the Minister to publish, within six months of Royal Assent, statutory guidance setting out the process by which authorised investigators are appointed under this part of the Bill.

Clause 7, as it stands, is one of the most powerful provisions in the Bill. It confers on authorised investigators a suite of powers drawn from the Police and Criminal Evidence Act 1984—powers that are usually reserved for police officers. These include the ability to apply for search warrants, seize property and access computerised information. These are not trivial powers; they allow the state to enter homes and businesses, seize personal possessions and compel the disclosure of data. Yet, as currently drafted, Clause 7 defines an authorised investigator as

“an individual who is authorised by the Minister to exercise the powers conferred by this section”.

It is, in effect, circular: an authorised person is whoever the Minister authorises. There is no clarity, no set of criteria and no publicly available process to explain how these individuals are selected, trained or held accountable.

If we are to grant powers of this magnitude—powers that mirror those of the police—Parliament and the public are entitled to know who will wield them and on what basis. The police are subject to detailed recruitment standards, codes of ethics and training requirements, all of which are set out in published documents such as the National Recruitment Standards-Eligibility Criteria for Police Recruitment and Consistent Recruitment Practices. Those standards exist for a reason: because with greater power comes greater responsibility. We should expect nothing less from the Public Sector Fraud Authority or from any civil servants who are to exercise PACE powers on behalf of the Minister. The public will rightly expect the same degree of rigour, impartiality and transparency that they would from a police officer acting under similar authority.

The amendment therefore asks for something very modest: a requirement that the process by which such authorisations are made be set out in guidance published within six months of this provision coming into force. That guidance would need to explain who is eligible, how individuals are assessed, what qualifications or training they require and what oversight mechanisms apply. In doing so, we would provide reassurance to Parliament and the public that these powers will not be exercised lightly and that those who wield them will be suitably qualified, appropriately vetted and properly accountable. We are, after all, creating a precedent here. These powers will not exist in isolation; they could endure for decades, exercised by future officials in future departments. It is therefore essential that we get the governance right at the outset and that we put clear expectations on the record and, ideally, in the Bill.

This is an area where guidance can make a real difference. It would strengthen the operational credibility of the new regime, improve transparency and protect the reputation of the PSFA. It would also provide Ministers with a clear framework to defend and justify their appointments in future. I hope, therefore, that the Government will look carefully at this proposal and, if they cannot accept it today, that they will bring back their own amendment at Third Reading to ensure that the appointment and oversight of authorised investigators meet the same professional standards and ethical safeguards that we rightly demand of our police. I beg to move.

[Baroness Fox of Buckley (Non-Afl)]

My Lords, after Committee this was one area of the Bill that I literally had nightmares about. I think a really dangerous precedent is being set here. I am rather disappointed that the noble Baroness, Lady Finn, will not divide the House on this, because this is one area where inadvertently handing over police powers to civil servants could completely backfire and cause real, serious problems.

I was talking recently to a group of people about some of the problems within the police force. Even though we have vetting and training, there are serious and well-documented problems of corruption, in some instances, or misbehaviour—I hardly need rehearse them. These police officers are charged with enormous privilege to act on behalf of the state. Therefore, we know that even when we have such safeguards in place, people with power can abuse that power.

In this instance, this Bill, however well meaning, intends to give similar powers to people when we have no idea what their training will be, whether they will be vetted and what qualifications there will be. Therefore, this amendment is entirely appropriate. It is rather modest, but it does at least seek to provide some safeguards for what is happening here, which is that the state is setting up a civilian population to act as police officers. To be honest, the public do not know about it. It is shocking. Whenever I have told anyone that this came out in Committee and that it is contained in the Bill, it is the thing that has shocked people the most. I hope not just that we can receive reassurances but that concrete responses are brought forward by the Minister as to what can be done to ensure that this does not go very badly wrong and backfire.

[Baroness Anderson of Stoke-on-Trent (Lab)]

My Lords, it is essential that any individual authorised to use the powers enshrined in the Police and Criminal Evidence Act 1984 is competent to discharge their duties under the law. We are committed to ensuring that this is the case for the authorised investigators created by the Bill. However, for legislation to require the publication of guidance on an internal appointment process is not only unnecessary but inconsistent with established practice in this area across other government departments. Government departments with similar investigative powers—for example, HMRC, the Home Office, Defra and even the Food Standards Agency—are not required to and do not publish statutory guidance on this point.

Let me reassure your Lordships’ House that Ministers take their responsibilities seriously. It is for this reason, as we have consistently affirmed, that no investigator will be authorised to exercise these powers until the Minister is entirely satisfied that they possess the requisite training and expertise. This training will cover: proficiency in relevant aspects of PACE, particularly the legal framework and applications of Section 8 and Section 9, and PACE codes of practice as far as they apply to the PSFA’s powers; proper procedures for applying for and lawfully executing warrants, including entry, search, seizure and handling digital information; and proper handling and retention of and access to evidence. Crucially, they will be trained in safeguards for individual rights during investigations and warrant execution, and in the proper handling and retention of and access to evidence.

Training will be provided by the College of Policing by means of a series of bespoke training courses, the first of which has commenced this week. Individuals will be required to demonstrate proficiency in all relevant facets of PACE before the Minister will authorise them as authorised investigators, with particular emphasis on the legal framework alongside its accompanying codes of practice. These authorised investigators will be members of the government counterfraud profession, and they will be required to meet the appropriate professional standards.

Therefore, I urge noble Lords to consider that the existing framework, bolstered by our commitment to rigorous training, already provides necessary assurances and that an amendment to codify this is unnecessary. I reassure and remind noble Lords that these powers cannot be exercised in any specific case unless a court has granted a warrant—the ultimate safeguard. I hope that this explanation reassures noble Lords and that the noble Baroness will therefore withdraw her amendment.

[Baroness Finn (Con)]

My Lords, we will not seek to divide the House on this amendment. I am sorry to disappoint the noble Baroness, Lady Fox, for whose support I am very grateful, but we will look in later groupings today at safeguards on the PACE powers granted to civil servants.

The amendment speaks to an important point, one that we have raised repeatedly throughout the passage of this Bill. We are granting serious powers to officials under this legislation—so-called authorised investigators, who will be able to exercise these powers, some of which are drawn from the Police and Criminal Evidence Act. We can never forget that these are not minor administrative tools; they are police-level powers to search, seize and compel. If we are to trust such authority to civil servants then Parliament and the public deserve full oversight of how those powers are used and, quite simply, by whom. That is the question this amendment asks and it is one that must be answered clearly before this framework is implemented.

The process for authorising investigators, the standards they must meet and the accountability mechanisms that apply are not small matters of drafting detail; they go to the heart of public confidence in this regime. We appreciate that the Minister can tell us now how this process will work, but some sort of formal, documented statement setting this out would be immensely helpful as a way of us having this beyond the Minister’s word. While I trust the noble Baroness completely, we do not know if we can always trust her successor or her successor after that. Setting this out would allow everyone to know the standards and process and would ensure that these are being met, not only now but in the future.

In short, I am grateful to the Minister for her response, but I hope the Government will reflect seriously on this issue and possibly come back with something at Third Reading. The powers in Clause 7 are significant and so too must be the safeguards that accompany them. On that basis, I beg leave to withdraw the amendment.

Amendment 5 withdrawn.

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[Baroness Finn (Con)]

My Lords, we understand that these amendments are technical in nature, designed to ensure that the Bill is properly aligned with the changes made by the Data (Use and Access) Act 2025. We therefore appreciate that these are tidying amendments that do not alter the policy substance of the clause but simply ensure legal coherence. I thank the Minister for bringing them forward—and I hope she enjoyed her honeymoon.

[Baroness Anderson of Stoke-on-Trent (Lab)]

My Lords, my honeymoon was fabulous.

I am grateful for the support of the House on these consequential amendments, following the Data (Use and Access) Act coming into force. I hope that noble Lords will provide their support to these amendments.

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[Lord Davies of Brixton (Lab)]

My Lords, I expressed considerable concern about this part of the Bill in Committee. I have studied the amendments that have been put forward and, like the noble Baroness who has spoken on behalf of the Liberal Democrats, will reserve my position, since we can come back to this. The amendments, which we have been told came forward last week, seem like an improvement, but the question is whether they are sufficient. It is easy to spot what is there; the most difficult part of the process is spotting what is not, and I need a bit more time to achieve that. So, although I am in no sense speaking against the amendments, I am reserving my position on the overall effect of this clause and the objections that I raised in Committee. I will say a bit more on the next group of amendments, which are more germane.

[Baroness Finn (Con)]

My Lords, the amendments in this group all relate to the duties placed on banks and other financial institutions in connection with debt recovery and information notices. Broadly speaking, the amendments represent a constructive and welcome set of clarifications from the Government. They respond directly to a number of issues raised in Committee about transparency, fairness and proportionality in the way that these powers are exercised.

On the Government’s amendments limiting the period during which a bank is prohibited from informing an account holder that it has received an information notice, we on these Benches see that as a largely sensible change. The amendment means that after three months or sooner, if a further notice is received under Section 21, the prohibition on informing the account holder will lapse. That is an improvement. It ensures that investigations cannot drift indefinitely in silence, while still protecting the integrity of live inquiries.

However, we would welcome confirmation from the Minister that when no action has been taken within that period then the department considers the case effectively closed or dormant. If a person is made aware that an information notice has been issued in respect of their account and they were in fact involved in some sort of fraud, then being made aware of this fact would compromise an investigation if it was ongoing, as that person could take action to avoid scrutiny. If the Minister could therefore clarify for us that, after this three-month period, a live investigation would not be affected through the sharing of this information then we would be content with this proposal.

I turn to the Government’s amendments removing the requirement for banks to prevent an account being closed outright where a deduction order has been made. This achieves the same policy outcome as the original drafting, ensuring that sufficient funds remain available for recovery, but it does so in a more proportionate and administratively practical way. The bank will still have to preserve the specified sum, but without being forced into the position of acting as an involuntary custodian for the rest of the customer’s affairs. That strikes the right balance between protecting public money and minimising unnecessary interference in personal banking arrangements.

We warmly welcome the amendment addressing suspended direct deduction orders. This is one that we pressed strongly in Committee, and we are very pleased that the Government have responded and taken us up on our suggestion, which was also supported by many other noble Lords, such as the noble Lord, Lord Palmer of Childs Hill, and the noble Baroness, Lady Fox of Buckley.

As drafted originally, the Bill would have allowed an order to be suspended indefinitely, potentially leaving someone in limbo for years, uncertain whether it would ever be reactivated. That was clearly unsatisfactory. The new provision rightly ensures that, if an order has been suspended for more than two years, it must be treated as revoked and all relevant parties notified. That is a fair and proportionate solution that restores clarity and finality for the individual concerned.

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Moved by

[Baroness Finn]

16: Clause 38, page 23, line 28, at end insert—
“(6A) The outcome of consultations conducted under subsection (6) must be laid before Parliament before any regulations under that section may come into force.”Member’s explanatory statement
This amendment would ensure that the outcome of consultations required by section 38(6) is laid before Parliament prior to the implementation of regulations.

[Baroness Finn (Con)]

My Lords, the amendments in this group focus on one central theme: ensuring proper scrutiny, transparency and accountability in how the powers granted under this Bill are exercised. These amendments are about ensuring that, as we build a powerful new framework for tackling public sector fraud, we also build in the right checks, balances and reporting duties, not only for Ministers but for the departments, banks and public bodies that will have to deliver the regime day to day.

The first of these amendments to Clause 38 would require that the outcome of any consultations held before making regulations on deduction orders be laid before Parliament before those regulations come into force. That is a reasonable step. Clause 38 already obliges Ministers to consult such persons as they consider appropriate, but, as things stand, there is no requirement to publish the results of explain how the Government have responded to the views expressed. This amendment simply ensures that Parliament can see the evidence and feedback underpinning any regulatory change. Banks and financial institutions will be at the forefront of implementing these powers: their experience and operational insight will be vital. Parliament should therefore be able to see what those institutions have said, what works, what does not, and what the likely impact of proposed changes will be before new rules take effect.

Alongside that sits our amendment requiring that any future regulations under Clause 38 be accompanied by an impact assessment covering the projected costs and effects on banks and financial institutions. As we have said throughout the passage of the Bill, the partnership with the financial sector must be one of collaboration, not imposition. An impact assessment is not an obstacle: it is a basic instrument of good governance. It ensures that decisions are informed by evidence, that burdens are proportionate and that Ministers, Parliament and industry all have a shared understanding of the practical consequences of what is being proposed.

Our third amendment, after Clause 64, would take that principle one step further. It would require the Minister, within 12 months of these provisions coming into force, to conduct a review of the administrative and compliance costs imposed on the banks by this Bill, including staffing, reporting and opportunity costs. This is about fairness and being realistic. We are asking the financial services sector to play a major operational role in this new system: to respond to information notices, process deduction orders and help recover public funds. That is legitimate for the purposes of the Bill, on which all noble Lords broadly agree, but it comes with a cost. Parliament has a right to know what that cost is and whether it is being managed proportionately and effectively.

At a higher level of oversight, our next two amendments would introduce annual reporting requirements. The first would require the Minister to publish an annual report on the use of the powers conferred under Part 1 of the Bill, setting out how often they have been used, in what context and with what results. This is about shining a light on the operation of the regime itself, how these new powers are working in practice, how effective they are in recovering public money and how proportionately they are being exercised.

The second would require an annual report on the overall extent of public sector fraud: a single, authoritative assessment of the scale and nature of the problem across government. The Public Accounts Committee, the National Audit Office and indeed the Government themselves have all acknowledged that the current picture is fragmented and inconsistent. Without reliable data, it is impossible to design effective policy, measure progress or target resources where they are most needed. An annual report would help close that gap, improve accountability and ensure that both Parliament and the public can see whether we are making headway against the problem.

None of these proposals is designed to delay or frustrate the Bill. We are not seeking to divide the House on these amendments. What we seek is assurance that the Government recognise the importance of these issues, that the machinery of the Bill will operate transparently, that Parliament will be kept informed and that those upon whom these duties fall will be treated fairly and proportionately. They are therefore constructive and common-sense measures. They would strengthen parliamentary oversight, improve the evidence base for future policy and help ensure that the strong powers created by the Bill are matched by equally strong safeguards and accountability.

I hope, therefore, that the Minister will reflect on these proposals in that spirit and that, as the Bill proceeds, the Government will bring forward their own commitments to embed these principles of transparency, consultation and reporting in the way that these powers are used. I beg to move.

[Lord Davies of Brixton (Lab)]

I have already taken the opportunity to reiterate the concerns I have expressed about parts of the Bill. I find myself in the somewhat against-the-grain position of agreeing with much of what was said on behalf of the Opposition. Amendment 26 seems to me entirely reasonable, given the level of concern that has been expressed about the extension of government powers over matters that are essentially personal. Although we are not going to vote on these amendments, I very much hope that my noble friend the Minister, in replying to the debate, will give a clear assurance that these workings—which, it has to be said, go into new areas of state control—will be looked at on a continuing basis and not automatically become a matter of routine.

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[Baroness Anderson of Stoke-on-Trent (Lab)]

I thank the noble Baroness, Lady Finn, for raising the important issues around annual reporting and the PSFA—both the use of powers conferred on it by the Bill and the extent of fraud against public authorities—as well as her point on the implementation of direct deduction orders, particularly concerning the regulations, the publication of consultation outcomes and the impact these powers may have on the banking industry. While I agree with the intent behind these amendments, unfortunately they are duplicative or would otherwise create an unnecessary burden for the PSFA. I will address each in turn.

Amendment 16 would require that the outcome of any consultation required by regulation-making powers for direct deduction orders in Clause 38(6) is laid before Parliament prior to the implementation of regulations. This amendment is duplicative: where a consultation is required, the Explanatory Memorandum of the relevant statutory instrument must detail and consider the outcome of that consultation exercise. Furthermore, the Cabinet Office consultation principles also set out that where a consultation concerns a statutory instrument, His Majesty’s Government should publish responses before or at the same time as the instrument is laid. We completely agree with the noble Baroness, which is why the provisions are there.

Amendment 17 seeks to hold the PSFA to commit to

“an impact assessment covering projected costs and effects on the operational capacity of banks”,

should any changes be made to the means by which deduction orders are processed by way of regulation, as set out in Clause 38. This amendment is also duplicative, as statutory instruments require that the impact on the relevant sector is considered and set out in the Explanatory Memoranda—even if that is to say no impact is expected—with reasons given as to why. Where the impact is expected to exceed £10 million, a full and separate impact assessment must be prepared and published alongside the SI.

The Government are extremely mindful of the burdens this Bill places on businesses, including the banking sector. We too want to ensure that they are not subjected to disproportionate burden or costs in complying with these measures, and we want to assure noble Lords that the PSFA is working on how to effectively operationalise the recovery powers in partnership with representatives of the banking sector. Throughout the development of the Bill, we have tried to strike the right balance between requiring actions from banks in a fair and proportionate way and achieving our policy intent of recouping vital public funds lost to fraud and error. That is why there has been sustained engagement with key representatives of the sector including UK Finance, individual banks, building societies, His Majesty’s Treasury and the Financial Conduct Authority. We know that the sector is supportive of the Bill’s objectives from the evidence provided by UK Finance in Committee in the other place. We have benefited from the sector’s operational insights and, as discussed on the previous group, we have tabled a number of amendments as a direct result, to ease the implementation and delivery of the recovery powers.

Amendment 22 would require the PSFA to undertake a review after 12 months on the cost to banks of complying with provisions under Part 1 of the Bill. The Bill’s published impact assessment—which sets out all expected costs to business, including banks, from the PSFA’s measures—has been green-rated by the Regulatory Policy Committee and sets out, where it has been possible to do so, the minimal expected costs to businesses, including banks, of the measures in Part 1 of the Bill. Provisions already exist under Clause 24 for banks to be able to deduct administrative costs that would offset what the review would report on. This amendment would create disproportionate administrative burden on the PSFA when, candidly, it should be using its resource to pursue those who defraud the public purse.

Amendment 26 would require a report on the use of powers by the PSFA to be published and laid in Parliament. I know the noble Baroness genuinely cares about ministerial oversight and accountability of officers using these new powers. I assure her that in addition to the reports that will be commissioned from inspectorates —such as His Majesty’s Inspectorate of Constabulary and Fire & Rescue Services—the independent person appointed in line with Clause 65 will proactively review the PSFA’s investigative use of the powers, including their efficiency and effectiveness. We have previously stated that these would be annual reports, and they will be laid before Parliament.

Lastly, I turn to Amendment 112, on annual reporting. This would require the PSFA to publish and lay in Parliament an annual report on the extent of fraud against public authorities based on the Government’s internal estimates. The PSFA already oversees the counterfraud performance of ministerial departments and public bodies and already publishes a report on the extent of fraud against public authorities through its fraud landscape reports. These set out levels of detected, prevented and recovered fraud and error as reported by departments and public bodies to the Government’s Counter Fraud Function’s centre of expertise. For transparency, these are now published online. We expect the next one to be published before the end of the financial year and can commit to sharing this with Members who have spoken in this debate.

I think I have touched on all the points raised, although there was a question from the noble Baroness, Lady Finn, on other safeguards. It may be helpful to reassure your Lordships’ House that we have the following additional safeguards in place. Authorised officers and investigators will be trained extensively and will be permitted to use the powers only once the training has been completed. They will follow detailed procedures and have strong guidance; for instance, on how to assess and handle potentially vulnerable suspects. There will be rights to make representations, request an internal review and appeal decisions through First-tier and Upper Tribunals across the civil penalty, debt recovery and information gathering powers. In addition, we will consult on and publish a code of practice detailing the calculation and application of penalties issued where fraud is found and where there is non-compliance with the information sharing and gathering requirements and debt recovery powers within the Bill.

I hope that reassures your Lordships’ House and the noble Baroness that we are already taking steps to achieve the same aim, and she can therefore withdraw her amendment.

[Baroness Finn (Con)]

My Lords, I thank the Minister for her remarks. I also thank the noble Lords, Lord Davies of Brixton and Lord Vaux, for their support for some of the amendments. I thank the Minister for the consideration she has given as well.

At the heart of this debate is a simple but important point: if we are to make the system work, we have to work with the banks, not simply through them. They are, in effect, being recruited as operational arms of the state, helping to investigate, enforce and recover public money. That partnership brings responsibilities on both sides. These amendments were never about creating obstacles; they were about ensuring that transparency, consultation and accountability are built into the process. The banks are being asked to play a vital role, and we must show them that their experience, concerns and costs will be reflected in how the Government engage with and implement the Bill. I beg leave to withdraw the amendment.

Amendment 16 withdrawn.

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Moved by

[Baroness Finn]

21: After Clause 64, insert the following new Clause—
“Fraud risk management duties for public authorities(1) This section applies to public authorities responsible for spending schemes or programmes involving total annual payments or disbursements exceeding £100 million (“relevant spending schemes or programmes”).(2) A public authority to which this section applies shall—(a) register each relevant spending scheme or programme with the Minister for the Cabinet Office via the Public Sector Fraud Authority before the start of each financial year;(b) conduct and submit to the Authority a fraud risk assessment for each registered scheme, detailing identified fraud risks and planned mitigations;(c) prepare an annual fraud measurement plan specifying the methods by which fraud rates will be determined, including representative sampling or comparable statistically valid methods, to ensure robust estimation of fraud and error rates.(3) The Authority shall—(a) independently verify each public authority’s reported fraud rates annually, employing rigorous audit, sampling, or comparable statistically robust methods;(b) publish annually, in a dedicated report laid before Parliament— (i) the fraud rates reported by each public authority;(ii) the independently verified fraud rates determined by the Authority;(iii) an assessment of the accuracy and effectiveness of each public authority’s fraud risk management measures.(4) Each public authority shall publish in its annual accounts—(a) its submitted fraud risk assessment;(b) the fraud rates as determined independently by the Authority;(c) an evaluation rating (Red-Amber-Green) assigned by the Authority reflecting the public authority’s compliance with and effectiveness of its fraud risk management duties.(5) The evaluation rating assigned by the Authority under subsection (4)(c) shall assess—(a) adequacy and accuracy of fraud rate measurement methodologies;(b) effectiveness of implemented fraud risk mitigations;(c) compliance with statutory duties set out in this section.(6) Where the Authority finds significant discrepancies between reported fraud rates and independently verified fraud rates, or otherwise finds significant discrepancies in the public authority’s fraud management practices, it shall issue a notice requiring the public authority to—(a) submit within 30 days a detailed action plan specifying corrective measures;(b) implement corrective measures as directed by the Authority within a timeframe specified in the notice.(7) Compliance by public authorities with their obligations under this section shall be subject to audit by the Comptroller and Auditor General, and the findings shall form part of their reports to Parliament.”Member's explanatory statement
This new Clause seeks to impose stricter fraud risk management duties on public authorities that oversee spending schemes exceeding £100 million annually, by requiring these authorities to register schemes, conduct fraud risk assessments, measure fraud using robust methods, and publish findings. The Public Sector Fraud Authority would verify reported fraud rates, publish comparisons, assign performance ratings, and enforce corrective actions for poor performance. Compliance would be subject to independent audit and parliamentary scrutiny.

[Baroness Finn (Con)]

My Lords, this amendment, tabled in my name and that of my noble friend Lord Younger of Leckie, seeks to insert a new clause establishing clear fraud risk management duties for all public authorities that oversee major spending programmes—that is, those involving annual disbursements exceeding £100 million. The purpose of this amendment is straightforward but fundamental. It is to ensure that the Public Sector Fraud Authority does not become, as it very easily could, an external body to which departments can simply outsource responsibility for managing fraud risk, rather than taking ownership of it themselves.

We have heard a great deal, rightly, about the scale of public sector fraud and the cost to the taxpayer, but as we look to the future, the real question is not simply how the PSFA will investigate or recover those losses; it is how we build a culture of counterfraud across the public sector—one in which every department, agency and accounting officer takes personal and institutional responsibility for preventing fraud at source.

This amendment aims to do exactly that. It would require all public authorities responsible for large spending schemes—those worth more than £100 million a year—to register those schemes with the PSFA, conduct fraud risk assessments and prepare annual fraud measurement plans. Those plans would have to use robust, statistically valid methods to estimate fraud and error rates, such as representative sampling or equivalent techniques. The PSFA would then independently verify those reported figures, publish an annual report comparing departmental self-assessments with its own verified data and assign each authority a red, amber or green rating to reflect the adequacy of its fraud management arrangements. Those ratings and the underlying data would then be published, both in each department’s annual accounts and in the PSFA’s report to Parliament.

Finally, where there are significant discrepancies or failings, the PSFA would have the power to require the relevant authorities to submit an action plan within 30 days setting out how they will correct the deficiencies. Compliance with these duties would then be subject to audit by the Comptroller and Auditor-General, bringing this entire framework within the scrutiny of Parliament.

This is a serious proposal that goes to the heart of what we have been saying throughout the passage of the Bill. Fraud is not a problem that can be solved by a single agency, however capable. It must be the business of the entire public sector. We cannot allow a situation to develop where departments and public bodies come to see the PSFA as an external safety net—somewhere they can pass the buck to when something goes wrong. If we are not careful, that is precisely what will happen. Officials will say that fraud is the PSFA’s job, Ministers will reassure Parliament that the PSFA is on the case and, in the meantime, the very culture of accountability that we are trying to build will start to erode.

This amendment reverses that logic. It would make counterfraud a statutory discipline—something that must be embedded, measured and reported on within each department and public authority. It would give the Minister for the Cabinet Office the information and oversight that they need to see at a glance where problems lie across government, and it would allow Parliament, through the Comptroller and Auditor-General, to see how public money is being protected and where it is being put at risk. In short, it would ensure that no official, no Permanent Secretary and no department can hide behind the PSFA. It would place responsibility exactly where it belongs—on those who spend and manage public money.

This approach also has a longer-term benefit. If departments develop and strengthen their own internal counterfraud capability, the need for PSFA intervention should gradually decline. That is what success should look like: not a PSFA burdened with firefighting every scandal across government but a public sector that has learned, embedded and internalised the discipline of fraud prevention. That is the culture shift we need. It is how we stop treating counterfraud as an emergency response and start treating it as an essential part of good public administration.

This amendment would give practical effect to that ambition. It would give the PSFA oversight, the Minister visibility and Parliament the means to scrutinise what is and is not being done across the system. If the Government are serious about tackling fraud at scale, then this is how they can demonstrate it: not by concentrating power in one central authority but by building a resilient, accountable and transparent network of fraud management across the public sector.

The amendment would strengthen not just the Bill but government itself. It would embed responsibility where it belongs and ensure that accountability, transparency and culture change go hand in hand. I beg to move.

[Baroness Fox of Buckley (Non-Afl)]

My Lords, one reason why I support the intention of the Bill is that I have become concerned that major fraud with public money has gone unchallenged for too long. One of my worries about the Bill is when it goes after low-hanging fruit—that is much more in relation to people on benefits, which we will discuss later on Report.

This amendment seems prepared to challenge what has become complacency about public money and waste and seeks to find a mechanism to ensure that it does not become yet another box-ticking bureaucratic exercise. While I am worried about even more bureaucracy, the intention behind the amendment is serious and rightfully puts the focus on where we should be worried: where people in public life have become utterly negligent with the taxpaying public’s money and feel that they will not be penalised. I am happy to go along with this, because I too worry that the PSFA will otherwise simply be a box-ticking exercise—somewhere where these matters will not be fully accounted for and discussed with the public. I will support the amendment should it be pushed further.

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[Baroness Anderson of Stoke-on-Trent (Lab)]

I have a huge amount of time and respect for the noble Lord, which is why I am smiling. He knows better than to suggest that I can bring forward and accept an amendment in 12 months’ time, after the legislation has already passed. However, he is right, and I agree with the principle and intention of everything the noble Baroness, Lady Finn, proposes. My argument is that this is wrong vehicle. It is the published mandate and the role of the PSFA as it exists—which was established by the previous Government—that we should open up, to ensure that it is fit for purpose as a cross-government vehicle and outlines its clear objective. That is the offer that I made to the noble Baroness.

[Baroness Finn (Con)]

My Lords, I thank the Minister for her remarks and the careful consideration she has given this issue. I am really disappointed that the noble Lord, Lord Palmer, has decided that he can no longer support the amendment. He warmly welcomed a similar amendment in Committee, describing it as

“a comprehensive and rigorous approach to fraud risk management for public authorities overseeing significant spending schemes”.—[Official Report, 11/6/25; col. GC 243.]

At its core, this amendment is about building a culture of responsibility and transparency across government—one in which fraud prevention is owned by every department and every accounting officer, not simply outsourced to the PSFA. We cannot afford a system in which the authority becomes a convenient safety net, while departments step back from the task of managing their own risk. As we said in Committee, let us return to first principles: public money must be protected, not just recovered after it is lost. This must be a whole-of-government effort, driven by evidence, accountability and openness. Departments need to know how they are performing and Parliament needs to be able to see this. That means regular, comparable data that is published, verified and available for scrutiny by both Houses.

We appreciate the Minister’s response and the spirit in which it was given, but I agree entirely with my noble friend Lord Gove: we do not believe that the reporting requirements set out in her answer are adequate. We need to see real movement on how these efforts are assessed—which departments are performing well, which are falling behind and how that performance is being improved. This information must be made public and open for review, and we know that this can be done without compromising ongoing investigations.

Transparency and accountability are not threats to enforcement; they are its foundation. This amendment goes to the very heart of what this Bill should be about: creating a genuine culture of responsibility across the public sector when it comes to tackling fraud. For too long, fraud management has been treated as a technical or procedural exercise, buried within internal reporting chains and obscured by bureaucratic complexity. The effect has been that too many departments and agencies see fraud as someone else’s problem, something to be passed up to the centre or delegated down to a third-party body such as the PSFA. However, the fight against fraud cannot be subcontracted. It has to begin and end with the public authorities themselves, which are entrusted with billions of pounds of taxpayers’ money.

Our amendment seeks to ensure that accountability is clear, transparent and public. It would require departments not merely to report internally but to publish their own risk assessments, have their fraud rates independently verified and be held publicly to account for their performance. In the long run, the success of the PSFA should not be measured by how much it does but by how little it needs to do because public authorities have developed the systems, culture and leadership to manage fraud effectively themselves. Yet as the Bill stands, that is not the direction of travel. This amendment is therefore essential to shift the incentives away from centralised dependency and towards departmental ownership, transparency and responsibility.

I am extremely grateful for the offer of further discussions from the Minister, but this is a matter of principle and effectiveness. We cannot have great power, as the Government are proposing, without great responsibility. I therefore wish to test the opinion of the House.

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[Baroness Finn (Con)]

My Lords, we on these Benches warmly welcome these amendments in the name of the noble Baroness, Lady Sherlock. They reflect the very same concerns that we raised in Committee about the scope and strength of the independent reviewer mechanisms provided for in the Bill, specifically the ability of those reviewers to request and be granted access to the information they need to do their job properly. We are grateful that the Government have recognised this point in relation to the Cabinet Office section of the Bill.

The amendment before us to Clause 66 ensures that, where information is reasonably required for the purposes of an independent review under Clause 65, the Minister “must” provide it rather than “may”. That is a critical distinction, as the noble Lord, Lord Vaux, pointed out. A reviewer cannot be independent or effective if their access to information is discretionary, subject to the good will or convenience of the department being reviewed.

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Moved by

[Baroness Finn]

25: After Clause 66, insert the following new Clause—
“Independent reviewer: reviews under Part 1(1) The Minister may by regulations establish a body to serve as an independent reviewer for the purposes of undertaking reviews under Part 1 of this Act.(2) Regulations made under subsection (1) must provide that any person appointed as Chair of the body must attend any pre-appointment scrutiny hearing held by the Public Accounts Committee of the House of Commons, or any successor committee.(3) Regulations under this section are subject to the affirmative procedure.”Member’s explanatory statement
This new clause would allow the Minister to establish an independent review body to undertake reviews under section 34.

[Baroness Finn (Con)]

My Lords, the main focus of my remarks in this group will be on Amendment 35. This amendment, in my name and that of my noble friend Lord Younger of Leckie, would insert a new clause after Clause 70 to require the appointment of an independent reviewer to assess how the Public Sector Fraud Authority uses the PACE powers—the investigatory powers derived from the Police and Criminal Evidence Act 1984, which the Bill proposes to confer upon it.

Under the amendment, the independent reviewer would be tasked with examining how these powers are used in practice, including their effect on police time, their operational impact, whether they have improved the efficiency of investigations and whether any complaints or disciplinary issues have arisen in relation to their use. The reviewer would report to the Minister within five years of the powers coming into force and annually thereafter, with those reports laid before both Houses of Parliament.

We have brought this amendment forward as a genuine compromise. We on these Benches want to work with the Government to ensure that the Bill succeeds in its purpose, which is to strengthen our national effort to combat fraud and to deliver a substantial and lasting reduction in losses to the public purse. We are not opposed to giving investigators the tools they need to do that job, but if the Government are still intent, as we understand they are, on extending PACE powers to civil servants within the PSFA, then those powers must be accompanied by robust and transparent oversight.

This amendment is designed to provide precisely that. It is a balanced and proportionate measure that ensures accountability without hampering operational effectiveness. The Government have been clear in their reasoning for granting these powers. They have said that it will save police time and resources, that it will allow investigators to act more efficiently, and that powers will be used responsibly and, where necessary, in conjunction with the police. Our amendment would simply hold the Government to those assurances. It asks them to demonstrate through an independent review mechanism that that these powers are indeed delivering on the objectives they have set out.

If the Government are confident that the PSFA will use these powers effectively and responsibly, and I have no reason to doubt their confidence, then they should have no hesitation in supporting this amendment. It would help them prove their case. The amendment gives the Government five years before the first review—ample time for the new arrangements to bed in, for the PSFA to become established, and for the data to show whether the powers are working as intended. Thereafter, annual reporting would ensure continued transparency and accountability.

It is clear that this amendment is not an attempt to frustrate the Bill—quite the opposite. It is an attempt to make it stronger, fairer and more credible. Oversight and review are not obstacles to effective governance; they are its foundation. If these powers are to be trusted, they must also be tested. We are therefore offering the Government a constructive path forward to accept a mechanism that ensures evidence-based assessment of how these powers are used, whether they are proportionate, and whether they are delivering measurable benefits.

If the Government’s case is correct that these powers will save police time, strengthen enforcement and be exercised with care, then this amendment would simply enshrine a process that will confirm that success. It is a sensible, good faith proposal that supports the Government’s stated objectives and ensures that Parliament and, indeed, the public can have confidence that this expansion of powers is justified, proportionate and effective.

If the Government are confident in their case, they will support this amendment. It is drafted to aid them, not to hinder. It is to help them demonstrate transparently and independently that these powers are being used well and wisely. If they are not minded to support us, I hope that the Minister will take this opportunity to set out to the House what alternative proposals the Government are considering to address these concerns. If the Government have no alternative, then I ask the Minister whether we on these Benches might come back at a later stage with a new amendment designed to address them. We cannot forget that we are talking about substantial powers which will be wielded against people in this country outside these walls. If we do not legislate responsibly now, we risk the well-being of those people to whom we all owe a duty. I beg to move.

[Baroness Anderson of Stoke-on-Trent (Lab)]

My Lords, it could almost be that we are back in Committee. It is the “Baroness Finn, Baroness Anderson show”. I do not think many people would pay, but still.

I welcome the continued and unwavering commitment of the noble Baroness, Lady Finn, to independent oversight. I once again reassure her that the Bill as it stands delivers rigorous and robust safeguards and oversight, addressing the intent behind these amendments efficiently without the need for duplicative amendments.

On Amendment 25, internal reviews are important as they provide a straightforward and affordable way to present a challenge to decision-making. They are an impartial element of many review processes. Under the current drafting, internal reviews can be requested to challenge, for instance, whether a direct deduction order is the most appropriate form of repayment or whether the deduction amount is fair and affordable, as well as the use of other powers in the Bill. The reviewing officer will be a highly trained authorised officer of a higher grade than the original decision-maker. They may decide to uphold, vary or revoke the direct deduction order. This decision will be based on an assessment of the materials held and any relevant new information provided. Crucially, should a review not provide satisfaction, there are further independent appeal rights through the First-tier Tribunal.

On Amendment 35, the independent oversight of the use of the powers under Part 1, including PACE powers, is so central to the passage of this Bill that we already have clauses in place to mandate it. As we have said, Clauses 65 and 66 require that an independent person appointed by the Minister undertakes reviews of the use of powers contained in this legislation. The independent person will conduct reviews to consider whether the exercise of the powers is in keeping with the legislation, codes of practice and relevant guidance. They will produce a report of their findings for the Minister, including any recommendations they deem appropriate. The Minister is then required to publish the report and lay it before Parliament.

As we have stated, the Government intend to meet the duty imposed by this clause in two ways. First, the Government will commission His Majesty’s Inspectorate of Constabulary and Fire & Rescue Services—HMICFRS—to inspect the PSFA’s use of the new investigative powers, including end-to-end investigative processing. Secondly, the Government are creating a new position for an independent person to whom the PSFA oversight team will report. The independent person will carry out reviews and report on whether the PSFA’s use of the powers in this Bill is in keeping with the legislation, codes of practice and relevant guidance, and consider areas where HMICFRS or other oversight bodies have not already reported. The employment of an independent person will also fully comply with the Cabinet Office Governance Code on Public Appointments, which is overseen by the Commissioner for Public Appointments. Clause 66 provides for the arrangements of timing of reviews between the Minister and the independent person.

In summary, the amendments are duplicative at heart. The right to independent assessment is already built into the legislation, via appeal and in the form of the independent reviewer to be appointed to review the use of the Bill’s powers under Clause 65. These would not require the addition of extra costs, people or processes that Amendments 25 and 35 would entail.

However, the Government note that Amendment 35 specifies particular areas of focus for a reviewer beyond what is in the Bill. Your Lordships’ House has also raised other areas that it would like an independent reviewer to consider. We have been clear that the independent reviewer appointed under Clauses 65 and 66 will have discretion to decide how and where they focus their reviews. Even so, to ensure that the House’s concerns are heard, I am committing to compiling a list of all the concerns raised here and in the other place to put before the independent reviewer for consideration once appointed. I will also request that the independent reviewer meet with all parliamentarians who have raised areas where they think his or her work should be focused. That way, the independent reviewer and the report they will lay before Parliament will be certain to meet Parliament’s priorities for scrutiny of the use of these powers. Given these assurances and this additional option, I hope the noble Baroness will withdraw her amendments, as the purpose is already met by the Bill as it stands and the commitments that I have just made.

[Baroness Finn (Con)]

My Lords, as this is the final group today, I will be brief. I thank the Minister. I was going to say, “I wish to make it clear that we intend to test the opinion of the House on Amendment 35”, which will be called on the second day of Report. Given what the Minister has said, we will reflect on that, but I am giving notice that we may still intend to test the opinion of the House. We believe that this is a well-drafted and constructive proposal that seeks to work with the Government in their efforts, and that it should form an integral part of the Bill. We can see how what is proposed marries up with that.

The amendment goes to the heart of the balance between empowering members of the Public Sector Fraud Authority effectively and ensuring that the use of powers is subject to proper, transparent oversight. We believe, as the Minister has said, that there is genuine scope for compromise. Our aim has always been not to constrain the Government but to ensure that, where such significant investigatory powers are granted, they are exercised with the appropriate safeguards, transparency and oversight that we think are essential if we are to maintain public confidence and protect individuals while still enabling the PSFA to pursue fraud effectively.

The Government have chosen a test and learn approach to the Bill—sorry, I have to do this—which has replaced the former proof of concept. Such an approach must be accompanied by clear provisions to report and evaluate those tests, ensuring that the learning happens in the right way. Meeting the Government’s own test for the use of PACE powers is a key part of that framework, and that is what our Amendment 35 seeks to achieve. But I thank the Minister for her words, and we will reflect. I beg leave to withdraw the amendment.

Amendment 25 withdrawn.

Security Update: Official Secrets Act Case

Baroness Finn Excerpts

Tuesday 14th October 2025 Lords Chamber

Let me finish by reiterating this Government’s unwavering commitment to national security and to keeping our country safe. We will take all necessary action to deter those who seek to do us harm, and to ensure that the UK is best placed to tackle state threats, including those emanating from China. I commend the Statement to the House”.

[Baroness Finn (Con)]

My Lords, the matter before us today is a grave and serious one, and I am glad that we have another opportunity to discuss it, following my noble friend Lord True’s success in securing a PNQ on the matter yesterday. The collapse of the case against Mr Cash and Mr Berry goes to the very heart of this Parliament. What is at stake is nothing less than the dignity and security of Members of both Houses and of those who work within them.

In their handling of the matter, the Government have shown a grave failure of responsibility. The Statement issued by the Security Minister in the other place on Monday was woefully inadequate. This dispute turns on one simple question: why did the Government not give the Crown Prosecution Service the evidence it needed to pursue this case? In both his Statement and his replies, the Security Minister failed to clarify four central matters.

First, he proceeded on the false premise that the previous Government did not regard China as a national security threat. The record shows that they did. For example, the head of MI6 in 2021 said that China was one of the biggest four threats to the UK, alongside Russia, Iran and international terrorism.

Secondly, like the Prime Minister, the Security Minister seemed to argue that it was not open to the current Government to give the Crown Prosecution Service evidence that differed from the previous Government’s view of the threat from China. In other words, he seems to have assumed that the present Government could not form their own view of the threat during 2021 to 2023 or provide a statement to that effect. That was wrong. Nothing in law or practice stopped the Government from doing so.

Thirdly, he cited the Roussev judgment as though it had narrowed the 1911 Act. It did not. The Court of Appeal made it clear that “enemy” includes any state acting against the safety or interests of the United Kingdom, whether or not we are at war with it.

Fourthly, he assumed that only the Government can determine who falls within that definition. There is no such requirement. The question is one of fact, not fiat, and may properly be assessed by a jury on the evidence before it.

I might stress that noble Lords should not just take my word for it. The Minister’s and the Prime Minister’s argument has been refuted by no less than one former DPP, two former Cabinet Secretaries—one of whom was a National Security Adviser—two former heads of MI6 and a professor of public law at the University of Cambridge, who said this week that Ministers’ statements so far are “misleading” about the legal position. The experts are all clear that Mr Cash and Mr Berry could have been prosecuted under the old legislation. Are we to believe the Government’s position that they are all wrong and that they—the Government—are right?

This case is only one symptom of a deeper failure in the Government’s approach to China. Ministers are still intent on allowing the Chinese Communist Party to build its new embassy on the Royal Mint site, within sight of some of the most sensitive financial and communications infrastructure in the country. They have done so despite clear and repeated warnings from our allies in Washington and from our own intelligence agencies that the project poses a serious espionage risk. Those warnings have been brushed aside and key details redacted from public view.

The decision to transfer the Chagos Islands to Mauritius tells the same story. China’s ambassador there publicly welcomed the move, congratulating Mauritius and confirming its intention to join Beijing’s belt and road initiative. Now, even as evidence of Chinese interference has reached into Parliament itself, the Government’s response has remained slow, confused and complacent. This is not an isolated failure but a pattern of neglect—one that leaves the United Kingdom exposed at a moment when China’s ambitions are clearer and more aggressive than ever.

Before I conclude, I have several questions for the noble Baroness the Minister. It is not for Ministers or officials to determine what evidence meets the threshold for prosecution. That judgment belongs solely to the Crown Prosecution Service. The Government’s duty was to provide all relevant information to the CPS when asked. They did not. The question is: who decided that the Crown Prosecution Service would not be provided with further evidence? Was that decision taken by Ministers, officials or advisers?

Everyone in government knows that a matter of this kind would have gone to Ministers. To pretend otherwise is not credible; to blame a single official is wrong. Did the Deputy National Security Adviser act without ministerial oversight in determining the evidential basis of the case? If so, who authorised that arrangement? Were any Ministers or special advisers shown, did they clear or were they consulted on the Deputy National Security Adviser’s draft statement before it was sent to the CPS? When the CPS requested further material, were Ministers shown this request and did they clear the revised version? Will the Minister publish the internal guidance that allowed the Deputy National Security Adviser to act “without interference” from Ministers, as well as the correspondence between the Cabinet Office, the CPS and the Foreign Office concerning the drafting of his statements?

Furthermore, how many current investigations rely on the 1911 Act, and have any been paused following Roussev? What part of that judgment, which produced six convictions, prevented the CPS proceeding in this case? Did any official or Minister advise that Roussev made prosecution under the 1911 Act impossible, and will that advice be placed in the Library? Mr Justice Hilliard cited the evidence of Matthew Collins, the Deputy National Security Adviser, as authoritative in Roussev. Why is the same official’s evidence deemed unusable when applied to China?

Why is guidance to Members being launched only today, when MI5 and the National Protective Security Authority have been aware of active Chinese interference since at least 2022?

Finally, will the Minister confirm whether Sir Olly Robbins has been instructed to make clear to his counterparts that the United Kingdom regards China as a national security threat and to set out what discussions he is authorised to hold?

This is not about one prosecution that failed. It is about whether we still possess the will to defend the institutions that safeguard our liberty. It is about whether those charged with protecting this country still understand what it means to act in its defence. When foreign powers reach into our Parliament and Ministers look away, it is not only our security that is breached but our sense of who we are. A Government who will not face the truth invite their own humiliation. A nation that tolerates such weakness endangers itself.

Britain’s strength has never rested on wealth or size but on the courage to confront those who would test it. That courage is now being tested again. The Government must speak plainly, act decisively and show that this country will never be cowed, compromised or complacent in the face of the ambitions of China. I urge the noble Baroness to answer not with evasion but with candour, and to meet this moment with the seriousness our duty to the nation demands.

[Lord Fox (LD)]

My Lords, I do not think that I have followed the noble Baroness, Lady Finn, in the past and it is a great pleasure to do so. I am happy to say that there are still one or two things left to say.

This Statement is clearly an attempt to put to rest the issue of these botched prosecutions, or non-prosecutions. So far, however, it has not only failed in that ambition; at the same time, it has resurfaced other issues regarding China and our relationship that generate increasing concern. Regarding the prosecutions, and given the Minister’s Statement and the Government’s adamant view that they have not concealed evidence or suppressed anything, it would be easy for the Government to publish all the relevant documentation. They have nothing to hide; we know that—they have told us, and we trust them. Will the Government publish all the relevant documents, as set out by the noble Baroness, Lady Finn, and the correspondence between all officials, politicians and advisers involved with the CPS?

It is time for the Government to properly protect the interests of our citizens so, working with the CPS, will the Government look at all legislative options to make sure that these two individuals have their time in the court, face a jury and are able to plead their case? These are the ways that the Government can push this issue to rest: by openness and actually seeking to prosecute.

More widely, this case has exposed appalling gaps in the Government’s willingness to challenge China’s considerable espionage efforts, but I am pleased that they recognise that we have a problem. The Statement is clear:

“We fully recognise that China poses a series of threats to UK national security”,


it says, but their actions fly in the face of that reality.

A former director-general of the Security Service has warned that Chinese espionage is being carried out on an industrial scale, including by seeking influence over Parliament, as well as in industry and education. This has been clear for some time. That was why we warned that exempting China from the enhanced tier of the foreign influence registration scheme under the National Security Act was a terrible mistake by this Government.

Will the Government now undertake to include all Chinese officials, Hong Kong special administrative region officials and Chinese Communist Party-linked organisations in the enhanced tier of the foreign influence registration scheme? More than that, the Government, supported by the Conservatives, exempted government administration and public bodies in their entirety from the FIRS scheme. Will the Minister now undertake to listen to the intelligence community and include people performing in these activities in the enhanced layer of FIRS?

Finally, as we have heard, it is now time for the Government to come to their senses and block the planning application for the Chinese mega-embassy. We know that, through its embassy in the UK, China has been co-ordinating the transnational repression of people who are carrying out normal and legal activities in the United Kingdom. Will the Minister confirm that the intelligence agencies were not consulted before the Government approved China’s new super-embassy in London, and will the Government now take heed and halt that project until a full national security review is completed?

Civil Service: Interns

Baroness Finn Excerpts

Tuesday 2nd September 2025 Lords Chamber

Asked by

[Baroness Finn]

To ask His Majesty’s Government how they will assess whether young people are from a lower socio-economic background when recruiting to the Civil Service fast stream summer internship programme.

[Baroness in Waiting/Government Whip (Baroness Anderson of Stoke-on-Trent) (Lab)]

The refocused Civil Service summer internship scheme will give talented undergraduates from lower socioeconomic backgrounds the opportunity to see what a career in the Civil Service is like. We will assess eligibility for the summer internship scheme based on parental occupation at the age of 14. The Social Mobility Commission identifies this as the most accurate measure of socioeconomic background.

[Baroness Finn (Con)]

My Lords, both the Constitutional Reform and Governance Act 2010 and the Civil Service Commission’s recruitment principles make it clear that a person’s selection for work in the Civil Service must be on merit, on the basis of fair and open competition. These rules ensure that the Civil Service can recruit a substantial range of talent from all backgrounds. The changes proposed by the Government to the summer internship programme would allow the child of a mechanic, an electrician or even possibly a toolmaker to apply but discriminate against the child of a roofer, a taxi driver or a nurse, who would be deemed ineligible. Quite apart from this dramatically reducing the range of talent, does the noble Baroness really believe that this is still a fair, open and, indeed, sensible process?

Infected Blood Inquiry: Additional Report

Baroness Finn Excerpts

Thursday 24th July 2025 Lords Chamber

[Baroness Finn (Con)]

My Lords, I thank the Minister for this opportunity to ask questions on the additional report of the Infected Blood Inquiry. I thank Sir Brian Langstaff for his continued work to get justice for the victims. Like him, the Official Opposition want to see fair compensation provided without delay to every person who is eligible—and the key words are “without delay”. I welcome that the Infected Blood Compensation Authority—IBCA—has accepted most of the recommendations made by the inquiry and we support the Government’s decision to instigate a review of the IBCA’s delivery of the scheme. The Government are also right to accept the seven sub-recommendations and engage with the community on those recommendations that they are not yet able to accept.

The critical factor in this issue is time. We know that many victims of the infected blood scandal have sadly died before receiving compensation. Ministers and officials must work tirelessly to ensure that victims receive the compensation that they deserve as soon as possible. In the other place, Ministers were clear that their top priority is to move quickly. Can the Minister confirm that the complexity of changes that will be made to the IBCA scheme will not stand in the way of timely payments? What assessment have the Government made of the complexity of the scheme after these changes, and the impact of that complexity on the timeliness of compensation? Under the previous Government, engagement with the infected blood community led to a broad push for timely compensation and it was thought by some that keeping the scheme simple would maximise the chances of delivering compensation more quickly. Can the Minister confirm whether this has been borne out in her own and other Ministers’ engagement with the infected blood community?

The Government have committed to bringing forward regulations following their acceptance of a number of recommendations. These are to be introduced as soon as parliamentary time allows. Can the Minister please confirm that these regulations will be laid on our return in September and taken through the House by the end of the year? We and the victims have waited long enough, and they cannot be expected to wait any longer than that.

The Government have also accepted the recommendation on a grievance mechanism. It is important that lessons are learned and we support the Government’s acceptance of this recommendation. Can the Minister confirm how Ministers will ensure that the grievance mechanism is properly staffed, and how its performance will be monitored? Finally, how will Ministers ensure that the grievance mechanism process does not lead to any delays in compensation for victims?

The additional report also contained criticisms of the IBCA, which raised concerns about its ability to maintain trust. Reports that the IBCA proposed a gagging clause during the process of agreeing the arrangements for lawyers to support individuals with the assessment of their compensation are worrying. The report also found that the numbers who have received compensation to date are profoundly unsatisfactory. We need to see urgent improvements.

I do not want to conclude my remarks without specifically raising the experience of the victims of unethical research practices, especially those who were pupils at Lord Mayor Treloar school. The additional report recommends that the IBCA should be authorised to make payments where it is satisfied that an individual was a victim of unethical research practices and that these decisions be based on the wider definition of research. The report also recommends that the Minister consider whether the compensation should be increased. We are pleased that the Government have listened and committed to consult. Can the Minister confirm when this consultation will be concluded and that the consultation will not result in any delay in compensation for victims? Questions have also been raised on the timeline of memorials for the young victims from Treloar. These are heartbreaking cases, so when can we expect work on memorials to be concluded?

It is essential that victims of the infected blood scandal receive fair compensation as soon as possible. We will continue to call for that, and press Ministers and their officials to address the criticisms and issues urgently to make progress so that we can achieve a better outcome for the victims.

[Baroness Brinton (LD)]

My Lords, for the second time in a fortnight, your Lordships’ House is debating a report from a judge telling the Government, in no uncertain terms, that the compensation schemes are not working properly and are an affront to the suffering that the victims have faced. The first, of course, was the Post Office Horizon scheme a fortnight ago.

From the Liberal Democrat Benches, I echo the thanks of the Conservative Benches to Sir Brian Langstaff for continuing to speak truth to power and for holding the Government to account. Today, the Government are responding to Sir Brian’s additional report, following his urgent session, in which he took moving evidence from the infected and affected victims and organisations. His report is blunt. He also said that he reserves the right to reconvene the inquiry at a further date, to further assess whether this Government have not just taken on board but changed the delivery process to ensure that all victims are treated fairly, speedily and with humanity. I am not aware of another judge having done that recently.

Ministers seem not to understand that every challenge—having to prove things again and again during the compensation process—revictimises those who have suffered already over many years. That should not be necessary. As usual, Ministers say the right words, but, as I said in the debate on the Post Office Horizon Statement, that is like the old bank adage on a rejected cheque: words and figures do not agree. Can the Minister say when the victims and Parliament will hear the results of the consultations and the consequent decisions by the Government on Sir Brian’s recommendations that they are not accepting in full today?

Sir Wyn Williams made an important point in the new Horizon report, which I and others have said repeatedly in Parliament: when will we have a truly independent body to manage inquiries and compensation schemes? IBCA is not truly independent; it is staffed by people who have come from various government departments, many of whom were involved in the process on the other side of the table, when victims were told repeatedly that there was nothing to be done and nothing to be seen.

However, this applies not just to this scheme or the Post Office Horizon one. As we heard earlier, it also includes Hillsborough, Windrush, the Manchester bombings, the nuclear test veterans, the medical scandals that cannot even get to first base—such as those around vaginal mesh implants and sodium valproate, which means that babies are still being born with deformities—and many others. I ask this Minister: will she and all the other Ministers managing these compensation schemes, including the so-called arm’s-length ones, get together to consider Sir Wyn’s recommendations?

I have a series of questions about the Government’s response. However, I will start by thanking the Government for the recommendations that they have already accepted: the HIV start date; the effective treatment award for those with hepatitis B or C; and, especially, the 31 March cut-off date for bereaved partners receiving support until their affected claim can be started—they are all vital. The Government have also recognised that the estates of deceased affected victims should now be able to pass on their compensation as those of infected victims can.

In the comments to Sir Brian’s report, the Paymaster-General says very clearly that the timescales are not changing. Sir Brian made it plain that it was unacceptable that the affected victims would not even start to be approached until the end of this year. Can the Minister therefore explain why this timescale is clearly not being speeded up? It makes a mockery of “working at pace”. How long will it take for IBCA to design and introduce a process for registration, as opposed to victims waiting for a call, as they might do for the lottery?

Newspapers have reported that, this time last year, IBCA consisted of just a couple of staff and computers. What is the headcount now, and what plans are there to ramp up the number of staff to speed up the processes?

The review of IPCA is expected to begin in August. When will Ministers report back to Parliament on its results? I do mean Parliament and not just the Public Accounts Committee. The Government have agreed to look again at some of the recommendations, such as the calculations of past care and financial loss—where the current process downgrades the commitment of home carers, many of whom have had to give up work for decades to look after their loved one—and the compensation scheme for victims of unethical research. The experience of the latter is among the most horrific of any scandal that this country has seen in the past 50 years.

Forgive the cynicism, but “looking again” gives no assurance that the severe wrongs done to the affected and infected victims will be remedied. Can the Minister say how long “looking again” will take?

To conclude, the Liberal Democrats are pleased that there is progress in the Statement and the report. However, Sir Brian, the many infected and affected victims, and Parliament will be watching to see whether this Government deliver—and swiftly—on their moral obligations to the victims of the infected blood scandal.

Legislative Reform (Disclosure of Adult Social Care Data) Order 2025

Baroness Finn Excerpts

Wednesday 16th July 2025 Grand Committee

[Baroness in Waiting/Government Whip (Baroness Anderson of Stoke-on-Trent) (Lab)]

My Lords, this Government are committed to rooting out public sector fraud wherever it persists. It is a pervasive crime that takes money away from vital public services and enriches those who steal from the taxpayer. This draft legislative reform order builds on initial work carried out by the last Government.

All of us accept that the scale of fraud in the adult social care sector is significant, taking vital public money away from the most vulnerable. In 2020, the Chartered Institute of Public Finance and Accountancy estimated that there was £240 million of adult social care fraud in 2019-20. Examples where fraudsters can target adult social care services include where individuals fraudulently claim a personal support budget from more than one local authority at the same time, and where individuals hide undeclared capital or property ownership in relation to helping fund adult social care, putting the burden on local taxpayers. Of course, there can also be errors in the system: for example, where deceased care home residents can still be in receipt of direct payments from a local authority. There can even be extreme cases of fraud linked to this, whereby individuals siphon money from the accounts of deceased individuals given in error. These are examples of the kinds of fraud that the legislative reform order will help tackle.

The draft order will help prevent fraud and error in the adult social care system by resuming the sharing of adult social care data across local authorities in England and Wales. This will allow the National Fraud Initiative, which I will refer to as the NFI, to use this data in its data-matching activities to identify and prevent fraud and error in the adult social care system. This will generate an estimated £2.3 million in prevented fraud loss across the UK every year. The NFI has been operating since 1996, with a long history of identifying and preventing fraud on behalf of public bodies. The NFI specialises in data matching, which involves comparing two or more sets of electronic data to detect potential fraud. Since the NFI began, it has detected, prevented and recovered a total of £2.9 billion in fraud and error.

The NFI’s most recent data matching exercise between 2022 and 2024, which took place over a two-year period, prevented, detected and—importantly—recovered £510 million across the UK, the NFI’s best ever result. It is vital to protect public funds that the NFI can appropriately access to the relevant data sources.

This draft order will amend paragraph 4 of Section 9 of the Local Audit and Accountability Act 2014—the LAAA—to add a provision that exempts “matched adult local authority social care” data from a restriction on disclosure. The draft order will also amend an equivalent provision of Section 64D of the Public Audit (Wales) Act 2004—the PAWA—to ensure that the draft order has effect in Wales.

The data matching programme the draft order seeks to reintroduce is not new. Adult social care data matching was previously undertaken by the NFI on behalf of local authorities and generated annual fraud savings of £2 million across the UK since 2009. However, this ceased when an amendment to the National Health Service Act 2006 in 2016 meant that local authority social care data became included in the definition of “medical purposes” under the NHS Act in new subsection (12A) of Section 251, inserted by the Cities and Local Government Devolution Act 2016.

Consequently, local authority social care data became included in the definition of “patient data” under the LAAA 2014 and the PAWA 2004, which refers to data held for “medical purposes” in Section 251 of the NHS Act. This means that the results of data matching using local authority social care data—now classed as patient data—could only be shared with “relevant NHS bodies”. Local government in England and Wales was not designated as relevant NHS bodies for the purpose of data sharing, even though local government is responsible for the provision of social care. This consequence was wholly unintended.

Local authorities are overwhelmingly supportive of this draft order. Some 90% of 137 local authority consultation respondents support this amendment and want this data match to be re-established and subject to approval by your Lordships’ House. Data matching will commence this autumn. The draft order will therefore restore the legislative status quo and again allow the NFI to share matched adult social care data with local authorities and tackle adult social care fraud. I beg to move.

[Baroness Finn (Con)]

My Lords, I begin by thanking the Delegated Powers and Regulatory Reform Committee for its excellent report on this order, which was published on 13 June. I am also grateful to the Business and Trade Committee in the other place for its own report, which was published earlier this month.

As the Minister explained, the order seeks to take us back to the status quo before the passage of the Cities and Local Government Devolution Act 2016, which included an amendment to the NHS Act 2006 that prevented the further sharing of this data with local authorities. We do not oppose this order but have a number of questions for the Government.

The order is being made under a power to amend primary legislation under the Legislative and Regulatory Reform Act 2006. We have concerns about the growing use of Henry VIII powers by successive Governments, and particularly this Government, who previously committed to use these powers more sparingly. When such powers are used, it means that lower levels of scrutiny are possible. This is one of the many reasons why we are so grateful to the Delegated Powers and Regulatory Reform Committee—the DPRRC—for its excellent work.

The 2006 Act is clear that the powers to amend or repeal primary legislation granted to Ministers by that Act are limited to specific circumstances. In this case, the DPRRC has agreed with the Government that the order meets the tests set out in Section 1 of the 2006 Act: namely, to remove or reduce burdens created by legislation. In its report, it noted that the previous Government began this work—I noticed that the noble Baroness mentioned that too—and that in response to the 2023 Cabinet Office consultation, which was targeted at local authorities, 90% of respondents were supportive of this legislative change.

We also share the Government’s objective to tackle fraud and error in bringing forward these changes. It is absolutely essential that the Government seek to tackle fraud and error across the public sector, and we have been working—I hope constructively—to improve the provisions of the Public Authorities (Fraud, Error and Recovery) Bill. This legislative order is predicted to deliver £4.6 million in recovered fraud and error every two years. The Government are absolutely right to seek to recover taxpayers’ money whenever it is lost to fraud and error provided it is practical and proportionate to do so.

Falkland Islands: Fisheries Exports Tariffs

Baroness Finn Excerpts

Thursday 10th July 2025 Lords Chamber

[Baroness Anderson of Stoke-on-Trent (Lab)]

My Lords, I live in Stoke-on-Trent, and I campaigned for remain in a 72% leave constituency. There are some elections I was definitely never destined to win. My noble friend will be aware that this Government are committed to making Brexit work. There is no point in looking back at this point; now we have to fix some of the problems that we have inherited.

[Baroness Finn (Con)]

My Lords, on the subject of tariffs, when the Prime Minister agreed his deal with the USA, he sold out the UK’s bioethanol sector, apparently without proper consideration of the impacts it will have on farmers across the country who sell their produce for bioethanol. Can the Minister reassure us that no future trade deals that disadvantage UK farmers will be accepted?

[Baroness Anderson of Stoke-on-Trent (Lab)]

My Lords, it is a stretch to go from fishing to agriculture, but I am more than up for the challenge. A thriving agriculture sector underpins our food security and supports the prosperity of regional communities across the UK. We will continue to seek fair and balanced deals, which include new export opportunities to grow the UK’s world-class agri-food and drink sector, which is the world’s largest manufacturing sector. In no small part we have already seen some of those arrangements with regard to the SPS deal, which will make trade better, including for fishing, and will help contribute an additional £9 billion a year in exports and growth to the UK economy.

Government Resilience Action Plan

Baroness Finn Excerpts

Thursday 10th July 2025 Lords Chamber

[Baroness Finn (Con)]

My Lords, I thank the Minister for giving us the opportunity to scrutinise the Government’s resilience action plan. There is much to be welcomed in this plan. In an increasingly unstable period, both domestically and abroad, it is vital that we invest in our defence and security as well as our national resilience.

The looming background to this plan is of course our national experience of the Covid pandemic, which we know the UK was ill prepared for. The pandemic preparations we had made were for influenza and we did not have the structures in place to respond to a coronavirus. Access to the right data was also a particular challenge for decision-makers. Professor Sir Ian Diamond confirmed to the Covid inquiry that

“no formal structures existed for the ONS to … contribute to civil emergency preparedness”,

beyond “ad hoc commissions”.

The Covid inquiry highlighted the difficulties that arose from different datasets being used in England, Scotland, Wales and Northern Ireland. Even within government there are problems, as government departments do not share consistent data freely. Can the Minister confirm that the Government are actively looking at these issues to standardise data across the United Kingdom?

During the pandemic, we also learned where the weaknesses were in our civil contingencies regime. The disparate responsibilities across government were one of the key challenges. We wasted no time learning the lessons from Covid so that they could be applied to pandemic preparedness, as well as in other areas. We established the national Covid inquiry and founded the UK Health Security Agency, and the Government are right to build on this work.

In addition to the weaknesses exposed during Covid, the pandemic demonstrated national strengths. At what was a very difficult time, the British people stepped up as volunteers up and down the country to do their bit, supporting neighbours with emergency supplies, volunteering at vaccine rollout centres, supporting one of the fastest vaccine rollouts in the world and enabling us to come out of lockdown sooner as we kick-started the pandemic recovery in our schools, businesses and hospitals.

The Government are right to include the role of the British people in resilience. We learned from Covid what a force of nature the British people are, and our national resilience is all the stronger if we can harness the voluntary will of our fellow countrymen. In the other place, my honourable friend Alex Burghart asked about proper communication—this will be vital. Can the Minister confirm what practical steps the Government will take in this regard?

We also welcome the focus on flood defence. In recent years we have seen serious weather events that have threatened homes, livelihoods and our food security. We must have the right measures in place to support communities affected by flooding and protect them from future flooding events. Can the Minister confirm what consideration is being given to the risk of flooding in our planning system to protect the homes of the future?

At the most local level, our flood response often relies on our rural communities stepping up to help their neighbours; this often means our farmers. Can the Minister please explain what steps Ministers are taking to rebuild trust with the British farmers after their trust in government was shattered by the cruel family farm tax?

There are a number of issues missing from the resilience plan. One of the major challenges to domestic stability is economic instability. The Government’s fiscal policies have left us with the third-highest borrowing cost of any advanced economy after New Zealand and Iceland, falling employment and higher costs of doing business. Meanwhile, the Government are empowering unions, reversing the constructive reforms of the Trade Union Act 2016 and making it easier for them to take destructive strike action through the Employment Rights Bill.

The Chancellor of the Duchy of Lancaster was unable to say whether the Government are preparing contingency plans for a general strike, or strikes in general, as part of the resilience action plan. Can the Minister now confirm whether preparations for a general strike will form part of the resilience action plan?

The Government have been clear in the resilience action plan that they will continue with the lead government department system for preparedness and that the Cabinet Office will retain a central but supporting role in our resilience planning. There are inherent problems with this approach. We talked about the proliferation of responsibilities, leading to an uneven response and nobody taking charge in times of crisis. This is obviously compounded by the problems of sharing consistent data across government.

I think there is a gap between the Government’s approach and the recommendations of the noble and learned Baroness, Lady Hallett, in module 1. She said:

“The UK government should … abolish the lead government department model for whole-system civil emergency preparedness and resilience”,


yet the Government’s plan implies that they will continue with this lead government department model. Will the Minister confirm that this plan does not abolish the lead government department model for whole-system emergencies? Have the Government therefore rejected the recommendation by the noble and learned Baroness, Lady Hallett, and how can the Minister explain the gap? Finally, can she confirm that somebody will be responsible and accountable to ensure that the lead government department plans are up to date and reflect the latest threats? What opportunity will there be for Parliament to scrutinise the work of both the Cabinet Office and the government departments’ work on preparedness?

I have a few further questions for the Minister. Which types of pandemic will Exercise Pegasus prepare for? We know that pandemic preparedness before Covid was focused on the wrong kind of pandemic. How will Ministers ensure that Exercise Pegasus covers all the scenarios it should, and will a list of the types of the pandemics we have prepared for be made available to Parliament? Finally, what steps are the Government taking to horizon-scan for biosecurity threats that may be developed by hostile foreign state actors? I appreciate that there are a lot of questions there and look forward to the response from the Minister.

[Earl Russell (LD)]

My Lords, on these Benches we very much welcome the publication of the Government’s resilience action plan. Of course, we recognise that we live in a period marked by heightened instability and insecurity. From the war in Ukraine to issues in the Middle East, climate-related issues and cyberattacks, the world is changing at an ever-greater speed. Obviously, these issues are not party political.

We acknowledge the steps outlined in the plan but call on the Government to go further in several critical areas to make the UK truly resilient. A national awareness campaign is essential to involve and empower our communities in helping to build our national resilience. The current approach of relying primarily on the GOV.UK Prepare website, while useful, may not reach all segments of society. We call for a broader public information campaign, drawing on the lessons from countries such as Sweden and Japan, where these issues are embedded in the education system and throughout the whole of society.

We also welcome the Government’s proposals to test a national alert system on Sunday 7 September, notifying 87 million people by text message. Text messages obviously have their limitations, so we call on the Government to look at a broader approach in this area. I know that everyone in the House will join me in sending our condolences to those in Texas and New Mexico for the terrible loss of life that they have suffered. In that instance, text messages were sent, but it was the middle of the night and people did not hear them. Can the Government consider installing sirens in areas where we know there are specific climate risks, such as floods and wildfires?

The Government have acknowledged the importance of dialogue on public resilience; in many other countries, that is a normal part of life. We welcome the commitment to expand the Prepare website and specific guidance for disproportionately affected individuals and sections of society. The plan must go further by comprehensively addressing the ever-growing impacts of climate change. We are seeing record-breaking wildfires and droughts, and I call on the Government to make better use of our weather-forecasting system to predict, and to inform us about, the risk of wildfires.

We welcome the commitment to flood defences, with £4.2 billion of funding, but we need to go further to make sure that we are climate resilient. We have not built a new reservoir in a long time, and last week Defra estimated that we will be 5 billion litres short of water by 2050. These are therefore urgent actions.

I turn to our critical national infrastructure. We have had recent, highlighted cyberattacks on many of our commercial businesses, but what if cyber attackers turn off the taps on our national water supply? Increased national threats require robust measures. We have discussed Heathrow this week, and we know that there were issues with identifying key CNI interrelationships and communications. The Government must commit to developing a cyber resilience index—we welcome that and the CNI Knowledge Base—to map these vulnerabilities. However, current CNI cyber resilience is not keeping pace with this rapidly evolving threat. We need to accelerate this work and to plug the gaps, to make sure that we are adequately prepared.

We welcome the legislation on countering ransomware and the Government’s proposed ban on the payment of that. That will help make sure that we are not a target.

Finally, the next pandemic obviously remains the number one threat and, again, is accelerated by the impacts of climate change. We welcome that the Government are preparing another exercise. We would like to see the full lessons learned from previous exercises and to make sure that more are learned from this one. We seek assurances that that exercise will test a full range of pandemic scenarios. We welcome the £1 billion investment in the new network of national biosecurity centres and the £15 million for the integrated security fund. Plugging these gaps in our biosecurity is obviously very welcome. We must also continue to support our universities, to make sure that we are preparing for the next pandemic.

The resilience action plan is a positive step. We need to be more proactive, more transparent and fully inclusive in our approach, to make sure that it is fully embedded in our society.

Fujitsu: Government Contracts

Baroness Finn Excerpts

Wednesday 9th July 2025 Lords Chamber

[Baroness Anderson of Stoke-on-Trent (Lab)]

I thank my noble friend for the work he has done and for his ongoing participation in the Horizon compensation schemes. I agree that all noble Lords should review the 17 cases Sir Wyn Williams has highlighted. Many of us will have listened again last night to the personal testimonies of Jo Hamilton and Seema Misra, which are totally and completely heartbreaking and give us an indication of the human cost of the Horizon scandal, including the 13 people who have committed suicide because of it.

We have urged Fujitsu to make interim payments. There are ongoing conversations with Fujitsu, including regular meetings with the Crown Representative, the Cabinet Office and DBT. We will continue to have such meetings.

[Baroness Finn (Con)]

My Lords, the Post Office Horizon IT scandal has seriously damaged public trust in procurement processes and, yet again, Fujitsu is right at the heart of it. Can the Minister tell the House exactly what the Government are going to do to finally hold Fujitsu to account and confirm whether the Government will be taking advantage of the new procurement regime enshrined by the previous Government, which allows the exclusion of suppliers from future procurement processes based on the grounds of professional misconduct?

[Baroness Anderson of Stoke-on-Trent (Lab)]

The noble Baroness is absolutely correct that the tools now exist because of the Procurement Act 2023. They came into effect on 25 February this year. But the process the noble Baroness describes is quasi-judicial and it is vitally important that we follow the evidence and make sure that we are acting appropriately with government money in the application of any investigation into Fujitsu. Obviously, there are also other accountability measures that are ongoing, including those currently being undertaken by the Metropolitan Police. There are many different levels of this investigation and the Government will respond in due course on our next steps after we have the full public inquiry findings.

UK Constitution: Oversight and Responsibility (Report from the Constitution Committee)

Baroness Finn Excerpts

Friday 4th July 2025 Lords Chamber

[Baroness Finn (Con)]

My Lords, I thank the noble Lord, Lord Beith, for so eloquently introducing the debate on the report today. I also take the opportunity to thank the noble Baroness, Lady Drake, who unfortunately cannot be here today, for her excellent leadership as chair of the Constitution Committee. It was a real privilege to sit on the committee at the time of the report’s preparation and publication, and I welcome the opportunity to reflect on its findings and the Government’s response today. I pay tribute to the brilliant clerks for their hard work and dedication. I am always unfailingly impressed by their ability to make sense of our sometimes lengthy and arcane discussions.

The report raises fundamental questions about how we govern ourselves and how we safeguard the integrity of the United Kingdom’s constitution. It is a reminder that the strength of our constitutional arrangement lies not only in its traditional flexibility but in the checks and balances that uphold it. The responsibility for different parts of the constitution is split across several government departments, and the Prime Minister holds ultimate responsibility through his allocation of ministerial responsibilities and ability to transferred functions between departments.

I welcome the Government’s recognition of the need to safeguard and uphold the constitution and their acknowledgement that further work is required to reinforce and protect the democratic foundations of our nation. While the strengths of the UK constitutional arrangements lie in the flexibility of the uncodified system, it is important to recognise that strains have been placed on the constitution, and it is imperative that we make meaningful reforms to ensure its continued resilience and integrity.

On the centre of government, the Government’s response recognises the importance of constitutional safeguarding within government, and that the Prime Minister is ultimately responsible for overseeing the constitutional arrangements. The Government also recognise the role of the Cabinet Secretary in supporting the Prime Minister in safeguarding the constitution. This was pointed out by the report, but the Government have rejected recommendations for setting out the Cabinet Secretary’s official responsibilities. There are potential risks in not formalising that responsibility, so can the Minister explain why the Government have chosen not to adopt this recommendation and why they have refrained from formally clarifying the Cabinet Secretary’s constitutional duties?

Without clarity, there is little hope of strengthening foundations. From my own experience in government, I know that the Civil Service often struggles with preserving institutional memory. Proper record-keeping and the retention of constitutional knowledge are essential. For example, when I was working in the Cabinet Office during the coalition Government, the Minister there, much to his astonishment, discovered during the course of an inquiry that there existed a rather chaotic room which housed the Cabinet Secretary’s so-called personal files. At the time there was no registry of these files; they were just thrown into the room. As a result, officials kept finding extra files after the initial request had gone out. The inquiry had been assured that it had been given all the documents—and then more files would come up, much to the exasperation of my noble friend Lady May, who was the then Home Secretary.

Over time, there has definitely been some longer-term institutional memory loss. The systematic documentation of precedent is crucial not only to maintain institutional memory but to enhance the quality of advice to Ministers. We saw an example of precedent not being followed this week with the ratification process in respect of the UK’s treaty with Mauritius. As my noble friend Lord Callanan pointed out on Monday, the Government have failed to follow a convention that, under the Ponsonby rule, requires that a substantive debate in the House of Commons on a treaty be granted when requested through the usual channels. This is the first time the Government have had to deal with the ratification process, and it is for the Civil Service to advise Ministers correctly on the constitutional precedent. Both my noble and learned friend Lord Bellamy and my noble friend Lord Norton of Louth referred to the need for clearer understanding of what happens if the Prime Minister becomes incapacitated or dies in office.

So, while I welcome the Government’s recognition of a need for a centre of expertise on constitutional matters, setting out the propriety and constitution group in the Cabinet Office to undertake that role, there is a case to go further. For the entire time I was in government, the propriety and constitution group did not always draw on the available precedent; there was a search for, or more of a scramble in search of, principles. My noble and learned friend Lord Bellamy made a powerful case for the need to hold those principles and all that information in one place.

As it stands, the propriety and constitution group does not have the institutional memory, and it is not clear to which Minister it is accountable. This is not a peripheral issue; it is central to the resilience of our constitutional framework. How, therefore, do the Government intend to safeguard the UK’s constitutional integrity across further Administrations if they fail to preserve such vital institutional knowledge within the Civil Service?

I take this opportunity to reflect on the role of the propriety and constitution group more broadly. I caution the Government to be careful about giving the group even more power. In its propriety role, it already controls all constitutional advice given to the Prime Minister. It manages the Honours Secretariat. It exercises day-to-day oversight of every major standards body in government, which includes the independent adviser on ministerial interests, the Commissioner for Public Appointments, the House of Lords Appointments Commission, the Civil Service Commission, the Advisory Committee on Business Appointments and the Committee on Standards in Public Life. Each of those bodies was intended to serve as a check on executive power, but instead they are line-managed by the Cabinet Office directorate.

The group’s remit extends to many areas, including public inquiries, major state events, the Privy Council and the Royal Household. It controls the freedom of information process at the heart of government and decides what the public are allowed to know and when they are allowed to know it. Indeed, its officials interpret the Cabinet Manual, to which many noble Lords have referred today, including the noble Viscount, Lord Stansgate, and my noble friend Lord Harper.

The point is that it is unclear to which Minister the group reports on all these areas. That is not really how a democratic constitution is meant to function. Civil servants are supposed to advise and to challenge, as my noble friend Lord Waldegrave pointed out. But Ministers are supposed to decide and then answer for those decisions. My noble friends Lady Coffey and Lord Hannan made some key observations in this regard. This has been a quiet but fundamental shift in the role of the propriety and ethics part of the Propriety and Constitution Group, which Ministers should watch with care.

There is obviously a need for a centre for constitutional affairs which functions effectively and is able to provide accurate advice to Ministers, but there would also appear to be a bit of a question mark over whether the centre should sit in the same group which has responsibility for propriety in government. Can the Minister confirm whether the Government have considered establishing a constitution unit which is separate from the propriety work of the Propriety and Constitution Group? As other noble Lords have rightly noted, the new Council of the Nations and Regions has made a strong start. However, it should serve to complement, rather than replace or compete with, the direct and formal meetings between the Prime Minister and the heads of the devolved Governments.

On the role of other Ministers, while I accept that constitutional oversight rests ultimately with the Prime Minister—I am absolutely mindful of the reservation expressed today by many noble Lords, including my noble and learned friend Lord Bellamy and my noble friend Lady Coffey—I think there is a case to assign some clear ministerial responsibility in this area. We talk about the centre of expertise: to whom would that be specifically accountable? The Prime Minister already carries an extensive portfolio of demanding responsibilities. Appointing a senior Minister to advise on constitutional matters and be accountable to Parliament for the work of the centre would not only alleviate some of that burden but potentially strengthen democratic accountability and transparency. I would be interested to hear the Minister’s views on the value of appointing such a senior and authoritative figure to carry out this role.

Finally, I turn to the critical matter of constitutional decision-making. When constitutional considerations are woven into policy development, tensions can arise. These are too often left unexamined. As noble Lords will know, the revised Ministerial Code, published by the Prime Minister in November 2024, expanded the powers of the Independent Adviser on Ministers’ Interests, granting enhanced authority to investigate ministerial conduct.

The Committee on Standards in Public Life has gone further and recommended that the independent adviser and other key regulators such as the Advisory Committee on Business Appointments should have a statutory basis. Here I concur fully with my noble friend Lord Harper and the noble Lord, Lord Pitkeathley of Camden Town, that the constitution is best when it remains flexible and allows the political system to respond. In my view, the Government must be extremely wary of any proposal to put these powers in statute.

In the case of the independent adviser, it would elevate the role in a way that may come to challenge the authority of the Prime Minister, who is the sovereign’s chief adviser. The independent adviser was established to provide independent advice to the Prime Minister, not to act independently of the Prime Minister. This shift potentially undermines the intended balance, and I strongly urge the Government to keep it under close review.

To conclude, while I welcome aspects of the Government’s response, it is clear that further steps are needed to ensure that our constitutional framework remains robust, transparent and resilient. Safeguarding the constitution is central to our democracy and we must not shy away from the architecture that upholds our democracy. It is our duty to ensure that our processes are legitimate and accountable, so that citizens hold trust in our institutions. I thank the Government for their response and urge the Minister to consider the points raised. I look forward to hearing from her.

NHS, Armed Forces and Civil Service Staff: Public Meetings

Baroness Finn Excerpts

Wednesday 2nd July 2025 Lords Chamber

[Baroness Anderson of Stoke-on-Trent (Lab)]

My Lords, ongoing engagement with stakeholders, whoever they may be, is key. Noble Lords will be aware that one of my responsibilities in your Lordships’ House is to discuss the Infected Blood Inquiry. There is a responsibility on our civil servants to engage every day both with those in the infected community and with the charities that represent them. That is true of every part of government business and it is vital that civil servants are available to do so, which is why this Government have not changed any such policy.

[Baroness Finn (Con)]

My Lords, the Minister will be aware that, under changes to the Civil Service Code brought in when the late Lord Heywood of Whitehall was head of the Civil Service, officials are forbidden to speak with journalists without the express agreement of Ministers. It is also the case, quite rightly, that policy officials should speak in public only with the express agreement of Ministers. However, does the Minister agree that, for officials with implementation functions, such as project management and digital procurement, the gagging order is unnecessary? They are already wrongly seen as second-class citizens in the Whitehall pecking order: blue collar compared with white-collar policy officials. Their work has little or no political content and we will not recruit the best if we infantilise them.

[Baroness Anderson of Stoke-on-Trent (Lab)]

My Lords, there is no such gagging order. This is about the grid system and making sure that, if someone wishes to participate in an event where media will be present, a request goes through the head of comms in that government department. That is available to all officials, regardless of their status. This is about making sure that we have a clear communications channel, which every Government since 1997 have used in the operation of No. 10.