6 Lord Desai debates involving the Department for Business, Energy and Industrial Strategy

Thu 4th Feb 2021
National Security and Investment Bill
Lords Chamber

2nd reading (Hansard) & 2nd reading (Hansard) & 2nd reading (Hansard): House of Lords & 2nd reading
Mon 19th Oct 2020
United Kingdom Internal Market Bill
Lords Chamber

2nd reading & 2nd reading (Hansard) & 2nd reading (Hansard): House of Lords

COP 27: Commitments

Lord Desai Excerpts
Thursday 24th November 2022

(1 year, 6 months ago)

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Lord Desai Portrait Lord Desai (Non-Afl)
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My Lords, I thank my noble and right reverend friend Lord Harries for introducing this topic, and we have had a great maiden speech from the noble Lord, Lord Leong, whom I congratulate.

Let me start with a contrast to the proposition made by the noble Baroness, Lady Hayman, about hope and optimism. I am going to talk about disappointment or despair, but not cynicism. Sharm el-Sheikh was a complete failure. The whole process by which we think we are going to achieve 1.5 or 2.4 or whatever degrees by international or inter-governmental negotiations—45,000 people turned up at Sharm el-Sheikh—is a delusion. Many people are very idealistic, and I respect their idealism; they sincerely believe they know what has to be done, and they hope that their Governments will agree to these sorts of steps. The Governments are all cynics, of course; they say yes at the conference, then go home and do something entirely different. We have had this proposition that somehow the globe is one. We saw a picture of the earth from space, and we suddenly got the delusion that the globe is one and that therefore our interests are identical, but our interests are not identical—certainly not as represented by Governments.

Sixty years ago, I got to America from India and the most popular book was Rachel Carson’s Silent Spring, which argued that the use of insecticides kills birds, and that this was the first signal that we were doing things that were against our own nature. Early in the 1970s, there was a conference in Stockholm on climate change with a slogan: “One week to save the world”. That was in 1971. Fifty years later, we are still trying to save the world. It is quite clear that we live in a system not of identity of global interests, but of power relations, where powerful countries do what they want, as they want and when they want. We saw that at Glasgow. In Glasgow, poor Alok Sharma was practically in tears because he could not convince India and China to agree to the coal target.

The same thing happens again and again. At Sharm el-Sheikh, everybody says, “Oh, there has been a fund created”. That fund has a quarter of 1% of the original planned fund—£250 million. The original planned fund was in billions, so this is pin money. It is not seriously going to compensate anybody for anything, but it salves the consciences of the various parties who are there. The world ought to really ask whether there is not a better process for doing these negotiations and making these decisions, because it reminds me of the worst kind of things done in the United Nations. The United Nations has a General Assembly. Whatever the General Assembly does, it does not matter a hoot because the five permanent members decide what the UN will do, and the five permanent members do not obey anything decided by the UNGA. We live in a very unequal society and therefore it is no good pretending that somehow the next conference, or the conference after next, will arrive at a decision which we will all agree to and heaven on earth will descend.

We have to hope that we can achieve better results on the carbon front within the UK, and the noble Lord, Lord Birt, and various other speakers have already detailed what we can do to clean up our environment, whatever anybody else may do. That at least can be done.

I welcome the remarks made by the noble Lord, Lord Leong, that, ultimately, we will have to rely on enterprise and innovation, which will come from the private sector and not from anywhere else, to find alternatives and better ways of doing the things we do so badly now. I do not know what they are because I am not technologically literate, but during my lifetime on a number of other fronts, such as communications, telephones, digital technology and so on, things have happened which have considerably simplified the world. They all happened because people wanted to profit. They will not happen for any idealistic reasons; they will happen for profit. Going along that path, I hope that we will get some solution. It will not come from any number of meetings of any number of countries, anywhere. In business, solutions pay for themselves. This would be paid for by taxpayers.

En passant, I ask: who decided to meet in Egypt? Why do we go and meet in the worst dictatorships going? We are going to the UAE. Why do we not just have every conference denouncing fossil fuel in Saudi Arabia, so at least we know we will not get anywhere? We will all have a fun time going there, but at least we will know that the outcome will be hostile to whatever we want to do.

However, at some stage we will have to find ways of making international decisions where global problems are involved in a way other than what we have constructed from the Rio conference onwards to many other international meetings, also attended by NGOs and very idealistic people, who all have to be disappointed. There are urgent tasks that need to be fulfilled. For example, who will look after the people who will face rising sea levels and will be made homeless? Do we have any plan to move those people away to safer countryside? That will be an urgent problem because people will drown if we do not do something like that.

We ought, at least privately, on our own as the UK, to try to think of some of those problems and see what we as a single country, and as one of the P5, G7, or whatever we are, can do. We are an important player in this context. We as a country ought to think through on our own what the urgent problems are so that we can solve the world’s problems, regardless of what the rest of the world does. I hope the Government will take on that task along the lines suggested by the noble Lord, Lord Birt, and I hope we get somewhere.

National Security and Investment Bill

Lord Desai Excerpts
Lord Desai Portrait Lord Desai (Non-Afl)
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My Lords, following the last speaker, I will have to be very inventive in saying anything that is worth saying. First, I congratulate the noble Lord, Lord Woodley, on coming into the House and wish him good luck. We look forward to hearing his views. I will start with his views, given the nature of the national security issue. I will confine myself to the old-fashioned definition of national security, and not the one about biodiversity—I have only six minutes.

National security is something which, if you define it, you lose. It is one of those things you have to keep very general and as undefined as possible, because people will find ways around any definition that is given.

Software rather than hardware is the nature of warfare now. Russia is able to undermine American security, or any kind of security. It no longer has superior weapons; it has superior hackers, and hackers make the difference. It is not manufacturing industry that makes the difference any more; it is not the space race, as the noble Lord, Lord McNally, was saying. We were all quarrelling about Huawei, because what Huawei does by way of software for 5G is going to make more difference to national security than anything solid. So, while I welcome this Bill, it is cast very much in the old mould, when manufacturing industry was important and people used to aggress on each other through it.

I also agree that we should not do anything that restricts the entry of foreign investment into this country. The noble and gallant Lord, Lord Stirrup, said, “Well, if the Bill creates problems, it creates problems, but there are good things and bad things and we should welcome bad things as well as good things because they interact on each other.” Ideally in a Bill of this sort, the first clause would say that national security means whatever the Government decide it means and the second clause would say that the Minister will do whatever the Minister thinks it is essential to do. We would have a good ISC that would keep guard on the Minister and we would make sure that there was parliamentary scrutiny on secondary legislation—but, of course, that is not possible.

The nature of warfare has changed so much that the next war, when it happens, according to an article in yesterday’s Times, is bound to be nuclear. There are now so many nations with nuclear power that it is hard to predict which way it will go. So, given that sort of background, we have to be inventive and cautious.

I will say one more thing. The importance of universities is overwhelmingly larger than it used to be. The commercial arms formed by universities are important, but so are the reasons students come to universities. Here again is a dilemma. We ought to have open immigration of foreign students, because you never know where a bright man or woman will come from. Their knowledge is useful because they interact and things are created. At the same time, we must be very careful that, in regulating universities, we do not kill research. To give one example: the entire nuclear programme was triggered by a bunch of absolutely unpractical theoretical physicists leaving Europe and going to America. They created the first atom bomb, because all they could do was nuclear physics, which was completely unpractical. So nowadays it will be the universities that determine whether we can fight wars efficiently or not.

So, while this Bill is very welcome, the way it is implemented and the way the Secretary of State restrains herself will depend very much on how intelligent, rich and flexible a definition of national security we have. I say to the Government, “Don’t put it on paper. We trust you. Just have a parliamentary committee that will keep tabs on you—and, those two things being given, the rest will follow.”

United Kingdom Internal Market Bill

Lord Desai Excerpts
Lord Desai Portrait Lord Desai (Lab) [V]
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My Lords, I will not speak to the legal aspects of the Bill, as I am not a lawyer, and that topic has been well covered. I will simply share with your Lordships my curiosity as to what made the Government try to enact this piece of legislation, which, as many have said, is totally outside the normal character of the constitutional behaviour of the United Kingdom. Some noble Lords have referred to this, but this arises out of historical and contemporary amnesia, which have struck the party in power.

First, let me say that I was a remainer, but I have always respected the decision of the people. However, we should notice one thing, which not many people have realised: that the decision in the referendum was more or less a decision by England, not by the United Kingdom. Of the 34 million votes cast, 18 million were for exit, and 16 million against, and 32 million were cast were cast by the English electorate. The difference in the English electorate, 17 million to 15 million, was exactly the final result margin of 2 million. So Brexit has always been an English decision, not that of the UK. Because the party in power has always been predominately an English party, it has begun to renege on devolution, in which it had no part. It was my party which initiated devolution, during the great Blair Government, and that is now being undermined.

The present party in power, 100 years ago, partitioned Ireland, creating Northern Ireland. At that time, as people may remember, the behaviour of the Conservatives when in opposition against the Liberals, and later when in coalition, almost amounted to subversion of the law, encouraging people in Northern Ireland to defy all manner of laws. Now we have come to a stage when the party in power has almost forgotten Northern Ireland. Boris Johnson inherited this proposition of Brexit, although of course he supported it. But I do not remember anybody at the time of the referendum discussion realising that the geography of the United Kingdom is not just England, Scotland and Wales. There is a region out there, Northern Ireland, which everybody forgot—that because Northern Ireland shares a border with the Republic and because we have signed an international treaty to keep that border open all the time, it was logically and legislatively impossible for Northern Ireland to leave the European Union and also have a free border. The logical and legal impossibility of the separation of Northern Ireland from the Republic of Ireland, while the Republic stayed within the European Union, was not, to my memory, ever discussed.

Baroness Scott of Bybrook Portrait Baroness Scott of Bybrook (Con)
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My Lord, I remind you of the time, please.

Lord Desai Portrait Lord Desai (Lab) [V]
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I will stop.

Competition and Markets Authority

Lord Desai Excerpts
Thursday 25th June 2020

(3 years, 11 months ago)

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Lord Callanan Portrait Lord Callanan
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We committed in our manifesto to tackle consumer rip-offs and bad business practices. The issues that the noble Lord, Lord Tyrie, set out in the CMA’s letter have helped shape public debate as well as informing government action. For instance, he said that consideration should be given to how to capture the benefits for competition and consumer welfare of the growth in the digital economy. We agree and have set up smart data proposals that we look forward to implementing.

Lord Desai Portrait Lord Desai (Lab) [V]
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My Lords, through the 100 days of Covid we have heard many complaints from consumers who have not been refunded for cancelled trips and cancelled products by the sellers; they have had no recourse. It is a serious situation that the Government ought to look into. If the Government are to make the UK globally competitive after Brexit, as they have promised, it is very important that they adopt a competition policy in line with the latest research in economics. I think they need an economist to head that authority, but the noble Lord, Lord Tyrie, will be difficult to replace.

Lord Callanan Portrait Lord Callanan
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I agree that we need a robust competition regime in the UK. That is what we have; the CMA has already announced reviews into many of the practices that the noble Lord highlighted, taking action against profiteering from some pharmaceutical companies, for example. We will not hesitate to take further measures if required.

Covid-19: Businesses and the Private Sector

Lord Desai Excerpts
Thursday 21st May 2020

(4 years ago)

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Lord Desai Portrait Lord Desai (Lab)
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My Lords, there is a public sector and a private sector, but there is also a social sector. We must not forget that the social sector is also part of private society. I have been very impressed by how many neighbourhood associations have sprung up to make lockdown tolerable for a lot of people. They have delivered things to neighbours, supplying food and any help. We ought to acknowledge our gratitude to our extensive network of voluntary neighbourhood associations which work towards general welfare and which have sustained us in the lockdown.

I also want to point out the role of charities, which have existed for a long time and risen to the occasion quite splendidly to fill the gap which the state has left in its provision for Covid patients. In particular, the newspapers have stepped in and organised special charities and fundraising for supplies and equipment. [Inaudible.] We ought to appreciate all that voluntary work.

I have a suggestion. Someone proposed earlier in the debate that the loans the Government have given to a lot of companies should be returned not in the form of money but in equity in those companies. That is a very fine suggestion. The Chancellor and Government should take advantage of it and set up a sovereign wealth fund from the equities returned by companies. Indeed, they should say that all loans should be returned in the form of equity and create a sovereign wealth fund.

Life Sciences Industrial Strategy (Science and Technology Committee Report)

Lord Desai Excerpts
Tuesday 23rd October 2018

(5 years, 7 months ago)

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Lord Desai Portrait Lord Desai (Lab)
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My Lords, I thank the noble Lord, Lord Patel, for chairing the committee that created this report and for his very good presentation. I also blame him for getting me to speak, otherwise I would not have spoken. Being the 11th speaker I promise to try to say something different. I promise not to talk about Brexit or the 29 Nobel Prize winners.

In a long time following government policies I have never seen an industrial strategy succeed if it was formed by the Government. Governments are not very good at forming industrial strategies. Industrialisation happens from the private sector not the public sector. Reading the report, very good though it is, I thought that setting up boards and implementation strategies was all top down. Somehow we will sit there and design a policy which will be implemented. That is not the way that innovations happen. I have been through the Harold Wilson policy when the idea was to encourage large corporations over small ones. Then we had the Conservative Party strategy and then new Labour’s one. We need to understand that if this is the way you want to go, fair enough, but there has to be a single lead person to implement it.

I will give two examples. First, when the redevelopment of the London docks was done—it is not an industrial plan but it was a major project—the noble Lord, Lord Heseltine, was crucial in driving the process forward. It happened because there was a responsible point person to implement it. Another example is the northern powerhouse strategy where the noble Lord, Lord O’Neill, has taken a lot of interest and been driving it forward. So yes have a strategy, have various committees that do various things, but then have a point person whose responsibility it is to deliver the strategy. Unless you have a point person the strategy will not be delivered. In parenthesis, I also worry about these very important people who do very useful work in their daytime jobs sitting around in a committee room in London for three or four hours. The opportunity cost of that must be enormous. They should have a conference call. We need to think about what successful strategies of innovation or change we have followed in the past and whether they can be repeated in this case.

My next point is about the NHS. It has been called the pivotal agency for this subject. It has been criticised by my noble friend Lord Hunt. I want to try to explain why it would be difficult for the NHS to do what is expected of it. We all love the NHS and we are always unhappy with it. We always want to lay more and more aims and objectives and goals on its shoulders. The main thing about the NHS, which will always be the case, is that it is underfunded. It is a universal law that if you price something at zero you will have perpetual excess demand and you will have to ration. You will have to decide what to do and what not to do. Current needs are so acute that things such as innovation may happen, but they will not happen by policy but by accident. As my noble friend Lord Hunt pointed out, you may have innovations that will be helpful and cut costs in the long run but to be able to afford to try that you need a bit of excess fat in the system. That excess fat is not there. If you adopt an innovation and it goes wrong the whole world will descend on you—newspapers and everybody will say, “My God, why are they wasting money doing this?” It is like a poor family living at the edge of the poverty line being told, “The food your children are eating is not healthy. Why don’t you eat organic food?” They reply that yes it would be better for them but they cannot afford it. One of the reasons for the obesity epidemic in poorer families is that bad food is cheaper and good food is expensive. But that is another story.

If we are going to have the NHS do anything about education innovations we will have to think of a new way of doing it. It is also a highly centralised situation. I read somewhere—in paragraph 58 or something—that they do not want an innovation that cannot be implemented across the whole thing. Why do they not adopt an innovation and let it spread? That is not in the logic of a centralised system. A centralised system is not very good for encouraging innovation. We know all this. It is not rocket science. Let us be kind to the NHS and say that what it does it does very well but it will not be able to do other things that we want it to unless we generate some extra income for it.

I shall just mention data. The noble Lord, Lord Freyberg, who will follow me, knows much more about the commercialisation of data and so on, and I am sure he will say more about it. However, I shall make two observations. By and large, under both parties in government, we have not been very good at using internet data in a large data-creating strategy—at recording, storing and using large datasets. We have failed again and again and had to abandon it. If we are to see NHS data converted into income and benefit for the NHS, we will have to get a better strategy than we have had so far.

There are two dangers. First, if we insist on centralisation, it is too large a problem to standardise and get all the data in a single format. If we do not do it, however, the problem will be that some regions will benefit from selling their data but others will not. The biggest danger is that as soon as you sell data people will say, “You’re privatising the NHS. Stop it”. I would love to see a package in which NHS data is sold for the benefit of both research and patients and can generate income. If someone can find a way of doing it, they should get a Nobel Prize. But it is not as easy as all that.

I want to say one more thing. It is usually said that in America it is much easier for pharmaceutical firms to innovate. It is more difficult in the UK. Why is that? In the UK we have what I call a monopsony buyer of drugs. There is a single buyer of drugs with very little room for experimentation. It does not have the excess fat to be able to experiment; it must buy whatever is going. In America, not only is expenditure much larger—as a total, as a percentage of GDP and per capita—it is decentralised. A pharmaceutical firm can try out an innovation in this, that or the other region and sell it across much more easily than by going to the NHS and having to bargain over whether it will buy the drugs. This is not an insurmountable obstacle, but we have to understand that the nature of the NHS is such that it would not be a very efficient buyer of innovations that it would be risky to adopt and which could fail.

In this respect, perhaps we ought to study why innovations in fields such as fintech and artificial intelligence in the UK are much more successful. There are fantastic small fintech firms that then grow bigger because they start small and are bought out. The fintech process is similar; it does not involve that much science but it involves technology and imagination in inventing new products and uses. We have a thriving fintech sector and a thriving artificial intelligence sector. It should be similar in this case; we should be able to have many successful small, innovative firms, which later grow into larger firms—or not. One question we ought to study is: why might there be obstacles in the life sciences sector that prevent such processes happening?

I have spoken for far too long, but this is an excellent report and I am sure the Government will derive the right lessons from it.