Procurement Bill [HL]

Lord Davies of Brixton Excerpts

Committee stage
Monday 11th July 2022 Grand Committee

[Lord Clement-Jones (LD)]

My Lords, I will speak to Amendment 46, which comes from a slightly different angle. In our report AI in the UK: Ready, Willing and Able?, our AI Lords Select Committee, which I chair, expressed its strong belief in the value of procurement by the public sector of AI applications. However, as a recent research post put it:

“Public sector bodies in several countries are using algorithms, AI, and similar methods in their administrative functions that have sometimes led to bad outcomes that could have been avoided.”


The solution is:

“In most parliamentary democracies, a variety of laws and standards for public administration combine to set enough rules to guide their proper use in the public sector.”


The challenge is to work out what is lawful, safe and effective to use.

The Government clearly understand this, yet one of the baffling and disappointing aspects of the Bill is the lack of connection to the many government guidelines applying to the procurement and use of tech, such as artificial intelligence and the use and sharing of data by those contracting with government. It is unbelievable, but it is almost as if the Government wanted to be able to issue guidance on the ethical aspects of AI and data without at the same time being accountable if those guidelines are breached and without any duty to ensure compliance.

There is no shortage of guidance available. In June 2020, the UK Government published guidelines for artificial intelligence procurement, which were developed by the UK Government’s Office for Artificial Intelligence in collaboration with the World Economic Forum, the Government Digital Service, the Government Commercial Function and the Crown Commercial Service. The UK was trumpeted as the first Government to pilot these procurement guidelines. Their purpose is to provide central government departments and other public sector bodies with a set of guiding principles for purchasing AI technology. They also cover guidance on tackling challenges that may occur during the procurement process. In connection with this project, the Office for AI also co-created the AI procurement toolkit, which provides a guide for the public sector globally to rethink the procurement of AI.

As the Government said on launch,

“Public procurement can be an enabler for the adoption of AI and could be used to improve public service delivery. Government’s purchasing power can drive this innovation and spur growth in AI technologies development in the UK.


As AI is an emerging technology, it can be more difficult to establish the best route to market for your requirements, to engage effectively with innovative suppliers or to develop the right AI-specific criteria and terms and conditions that allow effective and ethical deployment of AI technologies.”


The guidelines set out a number of AI-specific considerations within the procurement process:

“Include your procurement within a strategy for AI adoption … Conduct a data assessment before starting your procurement process … Develop a plan for governance and information assurance … Avoid Black Box algorithms and vendor lock in”,


to name just a few. The considerations in the guidelines and the toolkit are extremely useful and reassuring, although not as comprehensive or risk-based as some of us would like, but where does any duty to adhere to the principles reflecting them appear in the Bill?

There are many other sets of guidance applicable to the deployment of data and AI in the public sector, including the Technology Code of Practice, the Data Ethics Framework, the guide to using artificial intelligence in the public sector, the data open standards and the algorithmic transparency standard. There is the Ethics, Transparency and Accountability Framework, and this year we have the Digital, Data and Technology Playbook, which is the government guidance on sourcing and contracting for digital, data and technology projects and programmes. There are others in the health and defence sectors. It seems that all these are meant to be informed by the OECD’s and the G20’s ethical principles, but where is the duty to adhere to them?

It is instructive to read the recent government response to Technology Rules?, the excellent report from the Justice and Home Affairs Committee, chaired by my noble friend Lady Hamwee. That response, despite some fine-sounding phrases about responsible, ethical, legitimate, necessary, proportionate and safe Al, displays a marked reluctance to be subject to specific regulation in this area. Procurement and contract guidelines are practical instruments to ensure that public sector authorities deploy AI-enabled systems that comply with fundamental rights and democratic values, but without any legal duty backing up the various guidelines, how will they add up to a row of beans beyond fine aspirations? It is quite clear that the missing link in the chain is the lack of a legal duty to adhere to these guidelines.

My amendment is formulated in general terms to allow for guidance to change from time to time, but the intention is clear: to make sure that the Government turn aspiration into action and to prompt them to adopt a legal duty and a compliance mechanism, whether centrally via the CDDO, or otherwise.

[Lord Davies of Brixton (Lab)]

My Lords, I am speaking to my Amendments 128 and 130, although the issues raised there have already been addressed by earlier speakers. I fully support the amendments spoken to by the Front Bench and Amendment 57 tabled by the Liberal Democrats.

Procurement Bill [HL]

Lord Davies of Brixton Excerpts

Committee stage
Wednesday 6th July 2022 Grand Committee

[Lord Davies of Brixton (Lab)]

My Lords, I was not going to intervene in this debate, and my questions are effectively procedural. As I understand it, these amendments are to Schedule 2, although according to the Marshalled List, Schedule 2 has already been debated. We also have the report from the Delegated Powers and Regulatory Reform Committee, which made a number of trenchant criticisms of the contents of the Bill, including a provision in Schedule 2. Where and how do the Government respond to the points raised by the committee and where and how should we, as members of this Committee, raise the issues that were raised by the Delegated Powers and Regulatory Reform Committee? As my noble friend said, we have a mountain of paper here, and quite rightly we have been focused on all these government amendments, but I do not want the issues raised to pass by default. Does the Minister respond and, if so, when?

[Baroness McIntosh of Pickering (Con)]

I would like my noble friend to respond to a point that was raised by the noble Lord, Lord Purvis, on Monday, which is pertinent to the remarks from the noble Lord, Lord Coaker, just now. I am confused about whether paragraph 19 of Schedule 2 relates to military contracts only. I think that was the issue raised by the noble Lord, Lord Purvis, on Monday, and I do not know that we got a satisfactory answer. I am very confused about whether paragraphs 19 and 20 of Schedule 2 should be read together with paragraph 26. I think I am right that, on Monday, the noble Lord, Lord Purvis, raised whether the international agreements under paragraphs 19 and 20 relate to defence contracts only or whether they are more general.

Procurement Bill [HL]

Lord Davies of Brixton Excerpts

Committee stage
Monday 4th July 2022 Grand Committee

If the amendment which the Minister has introduced but not spoken to has consequences that go far beyond simply the below-threshold—as the noble Lord, Lord Lansley, had to indicate—the Minister must explain it. This set of amendments should be withdrawn or not moved so that, before the next day in Committee, explanatory statements can be attached to them. The Minister must give me the commitment now that the impact assessment will be updated and that there will be a new, entire set of explanatory statements. That is the least that the Minister could do, as other Ministers have done in situations far less bad than this.

[Lord Davies of Brixton (Lab)]

My Lords, I totally agree with everything that has been said. The rubric “technical amendments” has been bandied about in these discussions. The next group of government amendments, and the one after that, are described in the email from the Whips’ Office as “technical”. This group is not described as technical. If it is not technical, my presumption is that there are substantive changes involved and that no one, least of all the Minister, has told us what they are. I cannot see how we can agree the amendments today unless we are told what the substantial changes involved are.

[Baroness Humphreys (LD)]

My Lords, I apologise for not having spoken at Second Reading. I have taken a keen interest in the Bill, particularly in the devolution aspects. I will speak to government Amendments 355, 392 and 433.

I share the concerns of my noble friend Lord Fox, who speaks for the whole Lib Dem team, and other Peers who have spoken about the manner in which the Bill has been presented to us. Like others, I am particularly concerned about the large number of new government amendments tabled last week, the vast majority of which had no Member’s explanatory statement attached to them. The confusion over the weekend, when some amendments were removed from groupings and others were duplicated, must have been as stressful for staff as it was for Members trying to prepare for today. I echo my noble friend Lord Fox’s admiration for the efforts of the Government Whips’ Office staff.

Had the Government withdrawn the Bill after Second Reading, taken some time to incorporate the 300-plus amendments into the body of Bill and presented us with an entirely new document, life would have been so much easier for us all, including the Minister. Of course, it is not the Government’s job to make life simpler or easier for us, but it is their job to help us make good legislation, as the noble Baroness, Lady Hayman, said. We have the potential to be, as we are now, in a situation fraught with difficulties, confusion and recriminations.

Having made my own personal protest about the Bill, I must commend the UK Government and the Welsh Government on the working relationship between them as they work together on issues in the Bill. We heard from the Welsh Finance Minister about the excellent working relationship and the efforts of all concerned to approach discussions in a cordial and constructive manner. I thank the Minister for that.

I understand that a number of amendments have been agreed between the two teams and that some of them are in this group, but I am slightly worried that in all the confusion with the tabling of 342—or is it 350?—new government amendments, key agreements might be missed out or overlooked. It would help us greatly to scrutinise the devolution aspects of the Bill if we could receive a list of the agreements between the two Governments and the amendments to which they refer.

I am pleased that the three amendments I am speaking to recognise the role of the Welsh Ministers. In Amendment 355 to Clause 64, “An appropriate authority” is replaced by the more specific

“A Minister of the Crown or the Welsh Ministers”,

recognising the role of Welsh Ministers in the publishing of payment compliance notices.

Amendment 392 adds new subsection (12) to Clause 70:

“A Minister of the Crown or the Welsh Ministers may by regulations amend this section for the purpose of changing the percentage thresholds.”


In Amendment 433 to Clause 80, the reference to

“A Minister of the Crown or the Welsh Ministers”

confirms the amending power of Ministers in relation to changing the number of days within which sums may be paid.

All these are very welcome, but I would have been grateful for explanatory statements to help me decipher which of the other 300-plus amendments have implications for devolution. Can the Minister confirm that all the amendments requested by the Welsh Government have been included? Are there any outstanding issues that would prevent the Senedd passing an LCM for the Bill?

Procurement Bill [HL]

Lord Davies of Brixton Excerpts

2nd reading
Wednesday 25th May 2022 Lords Chamber

[Lord Davies of Brixton (Lab)]

My Lords, it has been an interesting, wide-ranging debate. I will base the bulk of my speech on the Government’s Green Paper, Transforming Public Procurement, published in December 2020. My interest is in what has been described as contract compliance by public authorities. It must be understood that public authorities, those covered by this legislation, have a range of objectives that come into play when they procure goods and services. Obtaining the goods or services at the lowest possible price is only one of a range of objectives they could follow.

Another objective—an overriding objective, I argue—is to encourage and secure a range of government policies through the contracts into which they enter. The Government’s support for this understanding of the role of procurement was clear in the Green Paper, which said:

“By improving public procurement, the Government can not only save the taxpayer money but drive social, environmental and economic benefits across every region of the country.”


I repeat: government policy is about not just price but achieving

“social, environmental and economic benefits across … the country.”

There is no indication of an order of priority of these different objectives.

The Green Paper states that

“we want to send a clear message that public sector commercial teams do not have to select the lowest price bid, and that in setting the procurement strategy, drafting the contract terms and evaluating tenders they can and should take a broad view of value for money that includes social value … We propose allowing buyers to include criteria that go beyond the subject matter of the contract and encourage suppliers to operate in a way that contributes to economic, social and environmental outcomes on the basis of the ‘most advantageous tender’.”

I anticipate that my noble friend Lord Hendy will not talk about bus shelters but emphasise how this approach can support improvements in employment standards.

Simply as another example, I emphasise how contract compliance, operated as part of procurement policies, can lead to improvements in environmental standards both in the UK and abroad. It is no exaggeration to say that this is a crucial element in what the Government need to do to achieve their goals for arresting climate change. It would be absurd if public authorities did not assess the impact on the climate of their procurement policies.

My concern is therefore that the Government’s position as set out in the Bill is now less clear-cut than it was in the Green Paper. For example, in paragraph 3 of the Explanatory Notes there is the statement of different goals, but paragraph 4 then goes on to talk only about

“value for money for taxpayers.”

We already have a national procurement policy statement, which was issued last year and is a sort of progenitor of the statutory statement we can anticipate later this year, I assume. Again, it sets out the range of objectives but then, in a separate paragraph, identifies and gives precedence to value for money. I am concerned that value for money is in some way seen as the key objective and the others as subsidiary. Do the Government still adhere to the approach set out in the Green Paper? This is obviously a key issue to consider in Committee, so will the Minister make the position clear: does the policy in the Green Paper still apply? In the explanatory statement and the statement of principles—the policy statement—it appears that at one stage there was a paragraph setting out the range of objectives, but then, unfortunately, someone read it and said, “This won’t do; we need an additional statement to emphasise money.” I really want clarity on that.

What role will there be within the national procurement policy statement for local policy objectives, even local objectives not fully in line with national objectives? The useful report, as ever, from the Library tells us that the Cabinet Office set out that the intention of the NPPS was not to impose the Government’s political priorities on bodies normally outside of their control, but rather to influence them. As you read through the paragraph however, it is clear that it is expecting its own democratically elected separate bodies to adopt the Government’s core principles. Will the Government make it clear that local authorities, which have their own democratic mandate, will not be dragooned by central government?

Finally, people may be surprised to know, a point about pensions. There is nothing in the Bill directly relating to pension schemes, but some schemes will end up being classed as contracting authorities and will be required to undertake procurement in the same way as government departments and local authorities. The Government say that attempts to introduce flexibility to simplify public procurement processes could impact on this sort of organisation. Great stress has been placed on the importance of simplicity in the process. I am not sure that simplicity is a good objective on its own. Clarity is an important objective, but simplicity can lead to confusion and difficulties for those organisations not regularly working through this process.

I am not expecting the Minister to respond on the impact on pension schemes at this stage, but it is an issue to which I think we need to return—smaller organisations caught within the remit. The Bill already includes provision for some exemptions, and we will need to look at whether waivers are required for some specific organisations.

Elections Bill

Lord Davies of Brixton Excerpts

Lords Hansard - Part 1 & Committee stage
Wednesday 23rd March 2022 Lords Chamber

Clause 11, as well as reflecting those things—and I am sorry to say this to some noble Lords who have spoken; I know that they do not like it—reflects the preference of British voters as expressed in the 2011 referendum. I am sorry this is the case. Two-thirds of people voted in favour of retaining first past the post for parliamentary elections in the 2011 referendum. Faced with that—

[Lord Davies of Brixton (Lab)]

The noble Lord is characterising my vote. It was against the alternative vote system and not for first past the post. We voted on an alternative vote system. That is not what the Minister is suggesting the vote was on.

[Lord True (Con)]

My Lords, I do not know whether the noble Lord has been here all through the debate, but I maintain the position that the Electoral Commission has reported. I have given the facts to the Committee on the problems that arose under the supplementary vote system.

Legislation: Skeleton Bills and Delegated Powers

Lord Davies of Brixton Excerpts

Thursday 6th January 2022 Lords Chamber

[Lord Davies of Brixton (Lab)]

My Lords, this is an important issue in terms of controlling the Executive and establishing the role for your Lordships’ House. I very much welcome the fact that this debate has been introduced by the noble Baroness. It refers specifically to skeleton Bills, but by incorporating the two committee reports the debate is somewhat wider. I do not make any apology for that.

I will use my brief time to highlight one specific issue identified by the Delegated Powers and Regulatory Reform Committee: that of the recent growth in the use of what the committee describes as “disguised legislative instruments”. This is dealt with in paragraphs 92 to 120 of its report. The committee provides various examples of this trend, but the common factor is that Ministers are being given the power to supplement primary legislation with what is, in effect, disguised legislation: instruments that are legislative in effect but not subject to parliamentary oversight. Examples have been quoted. The committee refers to

“powers to make a ‘determination’ … to determine ‘arrangements’ … to issue a ‘code of practice’, a ‘protocol’ or a ‘public notice’”,

and my major concern, to issue “directions”. The committee concluded that the

“the multiplicity of disguised legislative instruments is confusing to Parliament and to the public, and does not … promote the good law principles of law that is clear and accessible.”

The use of Treasury and other departmental directions in the context of the legislation on public service pension schemes sparked my concern, but I have subsequently come to understand that it is a wider problem, as highlighted in paragraph 101 of the committee’s report. It arises from Section 12 of the Public Service Pensions Act 2013, which provides a mechanism for what is called the cost cap as a limit on employer contributions. It provides that the cost cap should be determined in accordance with Treasury directions.

We have just had the McCloud and Sargeant case, which the Government lost, and there is a very expensive remedy. The Government have decided, by using directions, that the cost within the cost control mechanism should be borne by the members. I do not wish to argue the case for or against that decision, but it is manifestly a matter of public policy, where Parliament should have appropriate oversight over such an important decision.

Although we need to understand that there is not a hierarchy of significance in terms of different forms of legislation, some directions have a bigger and more immediate impact on individuals, their income and benefits than some pieces of legislation. Yet we spend a lot of time on the legislation and do not even get to see the directions. This is surely wrong. I think that is in accordance with the committee’s conclusions. It sets out a simple principle:

“In the absence of convincing reasons to the contrary”,


these devices “should not be used.” Will the Minister let us know whether he shares the concern about disguised legislation? If so, what steps will be taken to limit its use?

Budget Statement

Lord Davies of Brixton Excerpts

Wednesday 3rd November 2021 Grand Committee

[Lord Davies of Brixton (Lab)]

My Lords, with the leave of the Committee, I apologise for my late arrival but I was attending a meeting of the Finance Committee, and I understand that it is in order for me to participate. I have heard the majority of the contributions and benefited from what has been said.

I have a single, narrow but important point relating to pensions. the Chancellor said in his speech:

“I am announcing today that we will consult on further changes to the regulatory charge cap for pensions schemes, unlocking institutional investment while protecting savers”,—[Official Report, Commons, 27/10/21; col. 280.]


that took 25 words. It takes 29 words for the Red Book to say that

“the cap can better accommodate well-designed performance fees to ensure savers can benefit from higher return investments, while unlocking institutional investment to support some of the UK’s most innovative businesses.”

It goes on to refer to barriers to institutional investment.

I have three points to make in response. First, it would have been better for the Chancellor to have made it clear in his speech and in the Red Book that the charge cap on expenses applies only to default funds under automatic enrolment. Other forms of pension where people opt for other funds under automatic enrolment, or the many arrangements that take place outside the automatic enrolment arrangements, are not subject to the charge cap. It is up to the provider and the member of the scheme to arrive at their own provisions.

Of course, in practice the great majority of pension arrangements are default schemes under automatic enrolment. The number of schemes that have been taken up is testimony to the success of the automatic enrolment introduced by the last Labour Government. I think the default schemes are popular because people simply do not want to tackle what is inevitably a difficult decision. It could be characterised as great faith in pension providers, but I would put my money on inertia in the face of a choice for which most people do not have any training or experience and where there is limited or no independent advice.

Secondly, the situation where the default fund is the de facto standard arrangement places a particular responsibility on the Government not to play fast and loose with the trust, or the inertia, of the majority of people providing themselves with pensions. Over the many years that I have spent working on behalf of pension scheme members and promoting their interests, I have all too often encountered people with bright ideas, impressed with all the money that is held in the form of pensions, coming up with ideas to seek to use those resources for purposes other than providing pensions. The money in those funds is of course the members’ money and should be used in accordance with their wishes, not the wishes of Governments or others with other objectives.

That brings me to my third point. The Chancellor’s claim that

“savers can benefit from higher return investments, while unlocking institutional investment to support some of the UK’s most innovative businesses”,

is all too reminiscent of cold-call investment hucksters making promises that are too good to be true. If the potential returns are so attractive and so dependable, why are pension providers not able to promote them on their own terms, outside the default fund? Instead, they are all too ready to make unverifiable promises depending on future optimism. Make no mistake: this provision is about higher charges on workers’ pensions, with no guarantee of anything in return.

My advice to the Government is to be very careful here. They are, in effect, providing us all, the population, with investment advice. Of course, they are not authorised to do so. There is a history of pension scandals. Can the Minister assure us that he will take personal responsibility for making sure that we do not get another one?

Brexit Opportunities

Lord Davies of Brixton Excerpts

Thursday 16th September 2021 Lords Chamber

[Lord Frost (Con)]

This is obviously a very significant issue and why we put forward the proposals that we have in the Command Paper to try to deal with the problem. Our proposals for dual standards for goods circulating in Northern Ireland and a different way to manage the governance of the arrangements would, we hope, deal with the anomalies that exist, but, of course, they remain to be negotiated. It is a very significant difficulty which we have debated frequently and hope to resolve.

[Lord Davies of Brixton (Lab)]

My Lords, I am not used to this unarmed combat. Will the Minister update the House on the work of the Partnership Council? It held its first meeting on 9 June, since when we have heard nothing. This is despite the series of difficult issues that the council is meant to resolve following our departure from the EU, not least the recognition of professional qualifications. This body has the appearance of being the “long-grass council” where the issues that the Minister has failed to resolve will be left to fester.

[Lord Frost (Con)]

My Lords, I am certainly happy to update the House. The Partnership Council met before the summer, as the noble Lord noted. I would expect it to meet again before the end of the year. It is of course the supreme body of a complex substructure and the specialised committees have been meeting. Those that have not will meet over the rest of this month and in October, and will provide proposals and ideas to the council. So, although it may not be as visible as we would wish, there is a huge process under way that is designed to look at difficulties and, we hope, find ways of resolving them, including the question of qualifications that the noble Lord mentioned.

UK Government Union Capability

Lord Davies of Brixton Excerpts

Thursday 1st July 2021 Lords Chamber

[Lord Davies of Brixton (Lab) [V]]

My Lords, I, too, congratulate the noble Earl, Lord Kinnoull, on the debate and the noble Lord, Lord Dunlop, on his report. This Government’s lack of focus has been made out clearly by previous speakers, but there is also the Government’s glaring lack of respect for the devolved Administrations. In my brief remarks, I emphasise that devolution is a moving target, moving into and developing new areas, notably—to me—those of welfare and social security.

The problem here is not so much at the official level. What the report makes clear is the lack of effective joint working. One of the most dispiriting references is to the Joint Ministerial Working Group on Welfare, which the noble Lord, Lord Dunlop, says has become a forum largely for airing grievances and managing disputes rather than a forum for fostering more effective collaboration.

I add that I am proud to be British, English and even a bit Welsh, so I know that saying that we have one language in these islands is the sort of destructive attitude that is driving us apart.

Ministerial Code and Register of Ministers’ Interests

Lord Davies of Brixton Excerpts

Wednesday 19th May 2021 Lords Chamber

[Lord True (Con)]

My Lords, I try to make it a habit never to comment on the BBC, but I take note of what the noble Baroness says about television licences. She used a very important word in her question: “allegations”. Some are allegations; I believe some are smears. Most of them have been answered, and they are also being investigated. I suggest that we see what happens.

[Lord Davies of Brixton (Lab) [V]]

My Lords, the Minister referred to the remarks made by the Paymaster-General in the Commons yesterday. In the Government’s response to these questions today, we have again had this harping on about getting on with saving lives and striving to do their best. This is sheer obfuscation. That is not the issue. The question before us is: should Ministers comply with the Ministerial Code? Will the Minister take the opportunity to assure us that the fact there is a pandemic has no relevance to the absolute obligation on Ministers to comply with the code? The fact that we have a pandemic and that they are doing their best is irrelevant. Should they or should they not comply with the code?

[Lord True (Con)]

My Lords, I believe that all Ministers and all in public life should aspire to the highest standards, and I think that is the effort made. I do not agree that it is “harping on” to say that the Government are attending to the vital and urgent needs of the country in relation to Covid and recovery. A lecture of that kind comes ill from a party whose leader thinks his priority is to grab a roll of wallpaper in John Lewis. I wonder whether that has been declared.