Procurement Bill [HL]
Lord Wallace of Saltaire ExcerptsMonday 11th July 2022
(1 year, 10 months ago)
Grand CommitteeRead Full debate Procurement Act 2023 View all Procurement Act 2023 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 4-IV Fourth marshalled list for Grand Committee - (11 Jul 2022)
Baroness Brinton (LD) [V]
My Lords, I will speak to Amendment 30 but just want to say that I agree with Amendment 33, in which my noble friend Lord Wallace asks why suppliers from outside the UK are likely to want to compete for contracts for the supply of services. Amendments 34 and 35 remind us that there are a wide range of different bodies that need to be able to tender for services, probably mainly local, but they should not be either excluded formally or informally as a result of this Bill.
Returning to Amendment 30, I thank the noble Baroness, Lady Noakes, for her helpful introduction and I want to raise with the Minister matters that we will be returning to in Clauses 41 and 108. As the noble Baroness, Lady Noakes, has laid an amendment that includes health and social care services supplied for the benefit of individuals, there are questions that need to be raised. Had we been debating the second group of government amendments today, I would have covered this topic in the Minister’s Amendment 526 as well.
Clause 108 sets out the disapplication for this Bill in relation to procurement by NHS England, but Section 79 of the Health and Care Act talks about
“health care services for the purposes of the health service in England, and … other goods or services that are procured together with those health care services.”
It goes on to define a relevant authority in healthcare services in subsection (7) as
“(a) a combined authority;
(b) an integrated care board;
(c) a local authority in England;
(d) NHS England;
(e) an NHS foundation trust;
(f) an NHS trust established under section 25”.
The problem is that that definition excludes certain parts of health services. For example, an integrated care board will be commissioning, but not procuring directly, some services to primary and secondary care organisations. However, not all NHS organisations are covered by the relevant authority in the healthcare definition. For example, a GP surgery might be a private partnership or a company employing surgery staff including GPs. This might be UK based or even an overseas company, but not a trust or any of the other definitions. The same definition also exists for dentists’ surgeries. I was wondering if the noble Baroness, Lady Noakes, was thinking that this type of organisation would be covered by her amendment. Most of them are small organisations.
I ask the Minister this question of principle, really as advance warning that we will return to it later in the Bill. Why are health services, clinical and
“other goods or services that are procured together with those health care services”,
going to have a completely different procurement regime entirely delegated to the relevant Secretary of State, who can enact it by SI? That can ignore all the important clauses that we are debating in this Bill—value for money, value for society, transparency and the technical elements critical for anybody wishing to procure goods and services using money from the public purse, except for those parts of the health service that do not fall into that definition in the Health and Care Act, which will have to abide by the Procurement Bill.
Secondly, can the Minister advise on exactly where the dividing line is for those parts of the health service that are commissioned by other parts of it, but do not fall under the definition? It would be perfectly logical to have a contractor team preparing a bid for a contract with a regional consortium that includes a hospital trust and a non-NHS body, perhaps a charity—exactly the sort of small organisation that the noble Baroness, Lady Noakes, referred to—that worked with patients. It would have to remember, if syringes were included in that PFI contract for the new wing, for example, when the NHS procurement system would therefore be used, that there would be an entirely different set of rules, processes, et cetera, compared with a contract for a hospital trust that covered only non-clinical items, and therefore used the terms in this Bill.
This will be horribly messy. It will not just be confusing for contractors, which will need teams fully au fait with where the dividing line is between the completely different rules that will apply, but I suspect it will be total chaos inside the NHS. Can the Minister explain the thinking behind this and where the differences are? If possible, could we have a meeting with him and other noble Lords interested in the interface between this Bill and the Health and Care Act legislation, and in how it will work in practice?
Lord Wallace of Saltaire (LD)
My Lords, I will speak to Amendments 33 and 34, but I start by thanking my noble friend Lady Brinton for highlighting the need to make sure that this Bill and the Health and Care Act do not contradict each other. I was struck by a speech by the noble Lord, Lord Willetts, at the Second Reading of the Higher Education (Freedom of Speech) Bill the other week, in which he suggested that the Minister consider whether definitions of freedom of speech in the Online Safety Bill and the higher education Bill were compatible. The noble Lord very much doubted that they were. In spite of the current chaos within the Government, they need to ensure that different Bills going through in the same Session are compatible and do no cut across each other.
Amendments 33 and 34 are concerned with light-touch contracts. Amendment 33 is purely a probing amendment. We wish to understand the circumstances in which suppliers from outside the UK are likely to want to compete for contracts of the sort that the noble Baroness, Lady Noakes, suggested would be covered under the light-touch system—primarily, the provision of personal and social services to be delivered on the ground, in local communities, by people with sufficient local knowledge to be effective.
My concern here was heightened by the outsourcing of the initial test and trace contracts to two large companies, one of which has its headquarters in Miami, Florida, and neither of which has any appropriate expertise in local delivery or geography. Not surprisingly, therefore, testing stations were set up in inconvenient places and local volunteers, who offered to assist in large numbers, were often ignored. My colleague, my noble friend Lord Purvis, would have wished to ask whether the new trade agreements the DIT is negotiating would nevertheless open these contracts to overseas companies, including those from non-English speaking countries. Can the Minister therefore explain and justify the paragraph concerned?
Amendment 34 would put in the Bill the importance of local provision of services and the constructive role that non-profit entities can play in the provision of services in which sympathy, personal relationships and concern for welfare above immediate profit are important parts of the motivation for those who work in them and in which volunteers can also contribute to effective supply. My experience here is mainly from the care home sector, although I believe the argument stretches a good deal more widely than that. Private companies, including offshore-based private equity companies, have made excessive profits out of care home provision in a number of cases. Noble Lords will be familiar with Terra Firma, which the Minister will recall is based in the Channel Islands. That is why I have a later amendment that challenges the question of whether companies based in the Crown dependencies and overseas territories should be considered UK suppliers—but there are other examples.
Lord Wallace of Saltaire (LD)
My Lords, could we ask for some clarification on this, perhaps in a letter? Probation services are obviously a personal service that falls outside healthcare. Personal tutoring was raised by my colleague the noble Baroness, Lady Bennett. If this is to be a wider sector than purely health and social care, we would like a little more guidance as to how wide it might go.
Baroness Scott of Bybrook (Con)
I understand. We will make sure to get that guidance well before Report.
Amendments 33, 34 and 35, tabled by the noble Lords, Lord Wallace and Lord Lansley, and the noble Baroness, Lady Bennett, relate to Clause 8(4). This subsection identifies features that may constitute light-touch contracts and complements the regulation-making power to determine light-touch contracts in Clause 8(2). The noble Lord, Lord Wallace, included a probing amendment to delete Clause 8(4)(a). However, recognising that Clause 8(4) is an indicative list, the relevance of the provision is to identify that light-touch services are often unlikely to be of cross-border interest. I hope that that makes sense; if not, we can discuss it further.
This is still a useful identifying feature of light-touch contracts and helps readers of the legislation to understand why some contracts have light-touch rules. Set against subsections (4)(b) and (4)(c) of Clause 8, subsection (4)(a) identifies that the services are not exclusively domestic. We are content that Clause 8(4) is appropriate as drafted.
Amendment 34, proposed by the noble Lord, Lord Wallace, and the noble Baroness, Lady Bennett, requests an addition to Clause 8(4), which aims to ensure that local authorities, social enterprises, not-for-profit organisations, mutuals and charities are properly considered for such contracts. Similarly, Amendment 35, proposed by the noble Lord, Lord Lansley, has been put forward to include a consideration that
“the suppliers of such services consist of small and medium-sized enterprises and few larger enterprises.”
Clause 8(4) does not dictate how contracting authorities award light-touch contracts. We already have adequate provision in the Bill to support these groups to obtain public contracts—for example, reserved contracts, the introduction of a new user choice direct award ground, and maintaining significant flexibility to tailor award criteria for light-touch contracts. We think that we strike the right balance in the Bill by creating opportunities for these sectors while maintaining fair treatment of all suppliers in the awarding of public contracts.
Amendment 207, proposed by my noble friend Lady Noakes, would make the time limit at Clause 33(5) equal to the maximum duration for such a contract. The intention behind the change is to prevent a public sector mutual from being repeatedly awarded a contract for the same services by the same contracting authority.
It is not considered appropriate to align the time limit with the maximum duration permitted under the clause. It should be noted that there is no obligation on the contracting authority to award contracts that were run for the full five years’ duration allowed, or indeed that use the reserved contracts provision at all. In fact, stakeholder feedback indicated that the existing provision under the Public Contracts Regulations 2015 is underutilised due to its tight restrictions.
Public sector mutuals are usually organisations that have spun out from the public sector and most often deliver services to their local communities rather than nationally. It is therefore feasible that a reserved competition may result in a sole compliance tender, especially if the purpose of the contract is to provide services for the single local authority, which is likely often to be the case. If the restriction time limit were to match the maximum duration time limit, this could prevent the reserved competition from resulting in compliant tenders and require a new and unreserved competition to be run, which may not be in the best interests of the public.
The clause currently empowers the contracting authority to manage this risk when considering the procurement strategy, using its knowledge of the market and supported by guidance. If the time limits were to align, it would require more complex drafting of Clause 33 explicitly to enable this risk to be overcome within the time of restrictions. As I have said, if the restriction is too long, it may result in the reserved competition receiving no compliant tenders, given, I repeat, that public sector mutuals are usually organisations that have spun out from the public sector. Therefore, I respectfully request that these amendments are not pressed.
Lord Wallace of Saltaire (LD)
My Lords, I will speak to Amendments 44, 56 and 57. I too have gone back to the Green Paper and the Government’s response to that consultation and I remain extremely puzzled that this entire consultation process was undertaken, that the Government responded in their response document rather favourably to it, but that almost none of that is reflected in Part 2 of the Bill. Part 2 declares that it is about principles and objectives, but Clause 12 reserves the detailed definition of those objectives to the Minister—whoever he or she may be when it comes to it—to set out later in a policy statement. This is a skeleton Bill and, reading through several parts of it, and this section in particular, I am reminded that the DPRRC commented that leaving things to regulations often disguises the fact that Ministers have not yet quite made their minds up as to what their policy and intentions will be when it comes to it.
If Ministers continue to turn over as rapidly as they have under the current Government, we might anticipate that, every nine to 12 months, a new Secretary of State will wish to issue a new strategic statement. Clause 12 tells us that the statement will be presented to Parliament after carrying out
“such consultation as the Minister considers appropriate”
and making
“any changes to the statement that appear to the Minister to be necessary in view of responses to the consultation”.
So we are asked to leave all that—the underlying principles of this Bill—to the Minister, whoever she or he may be by the time this becomes law. Much better to start with a parliamentary debate on what the agreed principles for procurement should be, from one Government to another, than to present Parliament with changing Ministers’ changing ideas after lengthy discussions with others outside.
On that topic, can the Minister tell us which Cabinet-level Minister is now responsible for this Bill, or which Commons Minister he is co-operating with in managing it as it moves through the two Houses? That would help the Committee understand how and whether it is likely to progress and what difficulties or changed circumstances the Minister is operating under. I appreciate and almost sympathise with some of the difficulties he may be going through in those circumstances, but if we intend this Bill to last, to provide some stability for non-governmental suppliers and the clients of public services, we need to put agreed principles and objectives in it.
There was much more about principles in the Government’s response to the Green Paper. Can the Minister explain why it is not here? Why did it not appear necessary, in view of the responses to the consultation? Amendments 43, 44 and others insert statements of principles largely drawn from government publications. They are central to the Bill. I hope the Minister will accept that it was a mistake not to include them and that it is not acceptable to Parliament to leave this to a future Minister—or perhaps Government—and that he will return on Report, after consultation, with a form of words on this that can command a cross-party consensus and which reflects the consultation already undertaken. Amendments 43 and 44 offer different, though overlapping, drafts of what it might be appropriate to include in the Bill.
I will speak also to Amendments 56 and 57. Amendment 56 is purely exploratory; we deserve an explanation in clear and simple language of the grounds on which some suppliers are to be treated differently from others. Amendment 57 inserts clearer language on the criteria by which procurement decisions should be judged: value for money, cost, quality and sustainability—as the noble Lord, Lord Moylan, pointed out, it is the principles that matter most in setting the tone and culture under which the entire public procurement process will take place. These are important terms, not to be left to the policy statement when it comes but fundamental to the principles under which procurement decisions are taken. They must be in the Bill.
We are all aware of procurement contracts where the cheapest bid has produced unsatisfactory outcomes, where what has been promised has not been produced and where insufficient attention has been paid to quality or sustainability. The noble Lord, Lord Moylan, mentioned one, but there are many others. These need to be spelled out for future procurement, with the blessing and approval of Parliament. Parliament has been sidelined under the recent retiring Government; we hope that whoever succeeds our current Prime Minister will treat it with rather more respect and consideration.
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 Wallace of Saltaire (LD)
My Lords, although I am not a great expert on this subject, it seems that this is a case in which judicial review would be extremely easy because the question of how one justifies it is not spelled out here. Could the Minister perhaps write to us between now and Report about what criteria would then be used to justify the decisions taken? I entirely agree with the noble Baroness, Lady Neville-Rolfe, that one wants to ensure as far as possible that we do not leave large holes for judicial review to come in.
Lord True (Con)
My Lords, obviously I accept that, but we will certainly undertake to provide further information.
The noble Lord, Lord Scriven, was adumbrating cases where it should be possible to take different issues into account in terms of local activity. I understand the point that noble Lords are making about clarity. Clarity can either be sought through superdefinition, chasing the Snark through the end of the rainbow—sorry, I am mixing my metaphors—or it can be something for which the Government set out a clear framework that ultimately it is open to anyone in a free society to test under the common law. There is a balance to be found here and we will write further.
On Amendment 57, the noble Lords, Lord Wallace and Lord Fox, and the noble Baroness, Lady Bennett, complain that Clause 11 does not define value for money in order to leave a degree of flexibility for different types of organisation with different drivers to place a different emphasis on the concept. That is not unusual in legislation. Value for money as a concept is not uncommon on the statute book without further definition. It has been used in relation to setting high-level objectives for organisations, including the general duties of Ofcom in Section 3 of the Communications Act 2003 and indeed those of the Nuclear Decommissioning Authority in Section 4 of the Energy Act.
There are many precedents, I am told, but I have only given two of them where the term is left undefined, and this allows a degree of flexibility. We are happy with the broad interpretation of value for money, but Amendment 58 would have the effect of limiting the scope for future reviews of what value for money means. That is something that future Governments might wish to do. We do not support that position at the moment but, again, I am ready to listen to further discussion in Committee.
Amendments 128 and 130, tabled by the noble Lord, Lord Davies of Brixton, amend the provisions on award criteria. I am grateful to the noble Lord, first for the explanatory statement which sets out that his amendment intends to ensure that value for money does not override other procurement objectives, and secondly for his exposition of it. While it is important to be clear that Clause 22 does not affect the relative weighting of the objectives in Clause 11, I am grateful to the noble Lord for his consideration of this point and respond on that basis.
Public procurement needs to be focused on achieving value for money, and we submit that this is rightly at the top of the list of objectives set out in Clause 11. The noble Lord laid an amendment, the second part of which would in effect—taken literally—relegate or at least abnegate the possibility of placing value for money exclusively at the top. Our submission is that, while value for money will be the highest priority in procurement for the Government and that is reflected in the drafting of the Bill, it does not disapply or override the obligation on contracting authorities to have due regard to the other matters in Clause 11. I have no doubt that this will be probed further, but I hope that this will reassure the noble Lord that the amendment is not only unnecessary but, in its detail, we could not accept it. There is a balance to be sought here, and that balance will be seen differently by successive Administrations in successive places.
There was a very interesting range of amendments put forward in this group. I have listened carefully, and we will engage further on the points raised. I hope on that basis that noble Lords will feel ready to withdraw or not move their amendments.
“Procurement requirements
In carrying out a procurement, a contracting authority must have regard to—(a) the target to reduce the net UK carbon account;(b) the ethical and human rights record of the supplier;(c) the need to maintain data security within the digital platform; and(d) the necessity for transparency and openness.”Member’s explanatory statement
This amendment specifies a number of overarching requirements that a contracting authority must have regard to when carrying out a procurement.
Lord Wallace of Saltaire (LD)
My Lords, all the amendments in this group—which, the Minister will note, come from all the various groups and tendencies in the Lords, including the Conservatives—are concerned to spell out in the Bill in rather more detail the social and economic objectives that public procurement should promote. My name is on Amendments 45 and 59, but there is language in other amendments that I support and which I hope the Minister will accept. The concepts of “public benefit” and “social value” are broad and non-specific. We are asking for rather more spelling out of the kinds of benefit and value that are intended, in order to guide contractors and suppliers as well as Ministers and officials.
All of us on the Committee are conscious of the significant impact that the principles of public procurement can have on the broader UK economy and society. I am struck by the degree of consensus in the Committee around a number of issues. If I may say so, I have never before been so painfully aware of how much I am agreeing with the noble Baroness, Lady Noakes, and perhaps I shall ask to sign one of her amendments on Report. That shows a sense of what we are trying to do constructively with the Bill, and let us hope that we continue. I hope the Minister is indeed in a receptive and co-operative mood and will be willing to consult members of this Committee before Report and to return with agreed language that responds to these concerns.
I appreciate that there are some on the hard right of the Conservative Party who do not believe in moving towards net zero or in the concept of social value. Conservative Ministers and Liberal Democrat Ministers co-operated in producing the social value Act of 2012, which remains in force and is highly relevant to the Bill. With respect, there are a minority within the Minister’s own party and a smaller minority within the wider public who resist this. The Minister himself is a self-declared one-nation Tory committed to conserving the nation’s shared values and long-term interests, so let us put some of these shared principles and objectives in the Bill.
Amendment 45 would insert the target of reducing the UK’s net carbon amount. The Minister will note the modesty of that objective since it does not even mention net zero, and indeed the noble Baroness, Lady Bennett, will probably disapprove of my modesty. The ethical and human rights record of suppliers is a live public issue across the parties that will not go away, as the Minister must be aware.
Amendment 59 spells out what is a definition of public benefit that, again, I hope the Minister will agree with and shares. Will he now accept that such a definition ought to be in the Bill?
Baroness Thornton (Lab)
My Lords, I shall speak to Amendment 47A in my name and Amendment 52. Basically, we believe that Clause 11 should include specific references to maximising social value as something that a contracting authority must have regard to in line with the social value Act and the national procurement policy strategy. The question to which I would appreciate an answer from the Minister is: why is that not included? In my previous contribution, I went through all the different policy streams—including levelling up—that lead us to the conclusion that social value and support for social enterprises and social businesses are a good, and they are good in procurement. It is therefore a mystery why this has been left out of the Bill. I hope the Minister will agree with that and, if not, explain to me why it is not the case. I hope he will support these amendments and add them in. They are modest amendments, really.
Functioning of Government
Lord Wallace of Saltaire Excerpts(1 year, 10 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Wallace of Saltaire (LD)
My Lords, of course Her Majesty’s Government need to go on during this moment of very considerable external economic and political difficulty, but does the Minister accept that a great deal now needs to change? I see that the Daily Mail is still attacking any alternative to this Government as a “coalition of chaos”. However, the chaos that this Government have succeeded in creating with a single party seems to make that a very difficult case to put forward.
The relationship between government and Parliament needs to change. The attitude of government to the conventions and constraints of our unwritten constitution needs to change sharply. The relationship between government and the civil servants needs to change. If the noble Lord continues in office—with perhaps a new Minister in the Commons responsible for the constitution—will he insist that constitutional behaviour must absolutely be part of what the next Government do and that some constitutional change is essential to bring back confidence in public life?
Lord True (Con)
My Lords, the Government will continue their work to deliver the programme on which they were elected. We set out our programme for this Session in the gracious Speech. The Government remain in action, and the Leader of the House of Commons has announced a forward programme for business in the other place. The usual channels have announced the programme for this place, and I look forward to day three of the Procurement Bill on Monday in Grand Committee.
Procurement Bill [HL]
Lord Wallace of Saltaire ExcerptsWednesday 6th July 2022
(1 year, 10 months ago)
Grand CommitteeRead Full debate Procurement Act 2023 View all Procurement Act 2023 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 4-II(a) Amendments for Grand Committee (Supplementary to the Second Marshalled List) - (5 Jul 2022)
Member’s explanatory statement
This amendment is intended to allow a debate on a recommendation from the Delegated Powers and Regulatory Reform Committee in respect of Schedule 2. The Committee considers that the power under paragraph 17 “should be narrowed unless the Government can fully justify it”.
Lord Wallace of Saltaire (LD)
My Lords, the previous discussion has demonstrated the active concerns a lot of members of this Committee have that this Bill should not cramp the ability of local authorities to experiment with forms of local procurement, the encouragement of local enterprise, and so on. I had a message from a county council this morning on precisely that point. We are concerned about this. Perhaps there is enough room below the threshold, but we need to explore that a little more.
These amendments respond to the report on the Bill from the Delegated Powers and Regulatory Reform Committee. Members of that committee are here, so I shall be brief and defer to their expertise.
The Minister will be well aware that many in the Lords are deeply concerned about the Government’s determined move away from clear, detailed legislation towards skeleton Bills and executive discretion. The perhaps soon to depart Prime Minister campaigned to leave the EU on the promise of restoring parliamentary sovereignty but has worked instead to bypass Parliament wherever he can. The Minister for Brexit Opportunities and Government Efficiency, who, as far as I understand it, has some influence over this Bill, is pre-emptively arguing that the Prime Minister was elected by the people and not Parliament, and therefore does not have to go if he loses the confidence of Parliament. We all recognise that both Houses of Parliament are deficient in a number of ways and in need of reform, but, for the moment, we have the constitution that we have inherited, battered though it is, and the spread of Henry VIII powers across legislation is a breach of that constitution, as the DPRRC notes.
Amendment 18 therefore challenges the delegation of power to Ministers to make exempted contracts for the provision of public transport services. Amendment 21 similarly challenges the degree of autonomy given to Ministers in providing concession contracts for air services. Amendment 28, to the schedule on utility contracts, challenges the width of the powers granted to Ministers to make exemption determinations.
Amendment 31 is more egregious on the same theme. It would give permission for Ministers to specify by regulation which services will be subject to the light-touch regime for contracts and which will be excluded. The DPRRC’s comment on this is that the power
“should be narrowed unless the Government can fully justify it.”
I suspect that the Minister is unable to do that.
Amendment 208 also addresses the remarkably wide freedom given to Ministers with regard to light-touch contracts. Here, it goes into tertiary legislation, allowing Ministers by regulations to
“specify services of a kind specified in regulations of the authority under section 8”.
I hope that members of the Committee understand that; I am not entirely sure that I do.
Clause 86, to which I have tabled a stand part challenge, gives Ministers powers to make regulations about a range of documents on contracts and information about contracts. Clause 109 gives Ministers powers
“to amend this Act in relation to private utilities”,
requiring them to consult
“persons appearing to the authority to represent the views of private utilities, and … such other persons as the authority considers appropriate”—
but not anyone with any standing in terms of public or parliamentary accountability.
Clause 110, which is covered by Amendments 530 and 532, relates entirely to regulatory powers. Our amendments would implement the DPRRC’s recommendations to make pricing determinations for qualifying defence contracts subject to the affirmative procedure and restrict the ministerial freedom to raise financial thresholds above the rate of inflation. On all these clauses, the DPRRC argues that the breadth of ministerial discretion should be narrowed. It comments that, in a number of instances,
“the Government … have chosen this approach for no other reason than that it hasn’t yet developed the underlying policy.”
I ask the Minister to attempt to justify these overextended executive powers or, otherwise, to narrow the powers granted and recognise the importance of parliamentary scrutiny and the principle of parliamentary sovereignty. I beg to move.
Lord Berkeley (Lab)
My Lords, I put my name to Amendment 18 in the name of the noble Lord, Lord Wallace of Saltaire. I support everything he said. I am worried about the powers that the Government want to keep for themselves. I apologise to the Committee for not being here earlier; I was having a discussion with Ministers on the future railway structure, on which I believe there will be legislation this autumn. To some extent, that pre-empts what is covered by Amendment 18, which is to do with public passenger transport services. It is not just about trains; it includes buses and probably many other things as well.
Lord True (Con)
My Lords, I will have to take counsel and advice on that, and I will certainly come back. As I said, the fundamental position is to try to keep things as they are, exempting passenger transport services that are currently exempt and covered by the Department for Transport. Concession contracts are dealt with slightly differently under the regime—we will discuss that later—but I will come back to the Committee to clarify the points that the noble Lord asked about.
Lord Wallace of Saltaire (LD)
I thank the noble Lord for his explanations; if some of them had been available earlier, it might have been easier to accept some of the Government’s arguments. I find Clause 109 the most difficult: it gives the Minister the power to amend primary legislation without any reference to Parliament. But I note that he said that this will be looked at and perhaps discussed with others between Committee and Report, and I thank him for that constructive approach.
In turn, I am sure that he noted the strong views around the Committee about this particular Bill and the broader issues with skeleton Bills. We will return to this in a number of other areas in the Bill where we want to see spelled out things that we are at the moment expected to take for granted that the Minister will later say something about, provide a strategic policy statement on or whatever. That is simply not enough, so this will be a continuing issue.
In passing, as we keep stubbing our toes against the GPA, I am quite surprised that Jacob Rees-Mogg has not demanded that Britain withdraws from the GPA, because if we are to take back control we had better take it back properly of some of these international obligations, which clearly limit and constrain what we can do in a range of quite often important issues, but perhaps that is an over-partisan remark in Committee on a Bill. We will have to return to this, but I thank the Minister for the constructive way in which he has responded. I beg leave to withdraw the amendment.
Baroness Noakes (Con)
My Lords, Amendment 22 is in a group of rather different amendments, most of which have more meat in them than my amendment. It is a probing amendment to paragraph 4 of Schedule 3, which contains a provision to ensure that contracts are not fragmented in order to escape the value limits that govern some of the procurement rules. The basic rule in paragraph 4 is that the contracting authority has to add up the value of all the contracts if they could reasonably have been supplied under one contract.
However, paragraph 4(2) allows the contracting authority not to do this if it has “good reasons”. Amendment 22 proposes to remove this in order to find out exactly what the Government intend to allow contracting authorities to do and to probe why they have not been more specific in the Bill. At first sight, paragraph 4(2) is a massive let-out clause, enabling authorities to avoid aggregating contracts. I look forward to my noble friend the Minister’s explanation. I beg to move.
Lord Wallace of Saltaire (LD)
My Lords, I rise to speak to Amendment 81, which we on these Benches regard as particularly important. It would put in the Bill one of the most important decisions to take before embarking on the procurement of public goods and services: make or buy? That is the subject of an entire chapter in the Government’s own Sourcing Playbook. This key decision process is missing from the Bill. We seek to put it in as an essential part of the pre-procurement process. The choice of delivery models should be based on careful and impartial consideration of the different forms of delivery available for each type of work, supply or service.
Conservatives in Government have sometimes acted as though outsourcing to for-profit companies—often large outsourcing companies that have been labelled “strategic suppliers”—is the only model worth considering. Unless the Minister wishes to argue that The Sourcing Playbook and other recent publications on procurement guidelines are no longer operable, it seems entirely appropriate to put in the Bill that the choice between in-house and outsource should first be considered. Later, we will move other amendments on the delivery model choices between for-profit and not-for-profit provision.
We have carefully followed the Government’s own language in these publications in drafting the amendment. The Minister may argue that we should leave the Bill a skeleton as far as possible to allow Ministers as much flexibility as possible; we have heard him press the case for flexibility already. We argue the case for clarity, accountability and future-proofing. The principles of the procurement process must be in the Bill, not left for later in the policy statements issued by changing Ministers as they pass through the relevant office.
Lord Berkeley (Lab)
My Lords, I support all the amendments in this group, but particularly those tabled by my noble friend Lord Hunt of Kings Heath. In his introduction, he emphasised the importance of rigour, accountability and transparency. I would add advance notice. The Minister who responds may say that it is all in the Treasury Green Book. It probably is, but anybody who has looked at small projects—localism, levelling up, town centres—will know that you have to comply with the Treasury rules, but it is hard to find them, especially for people who do not understand them too easily. My noble friend has put in this amendment and all the other things that go with it. It is really important in a Procurement Bill that people know what to expect and how to do it.
It also needs to be not confidential. I have a couple of examples. The first is an excellent example of the need for a business case. Some noble Lords may know that Cornwall Council was supporting a new stadium for football, rugby and everything else in Truro, which everybody seems to want, and there is private sector involvement. Last week, Cornwall Council decided that it was not going to do this and withdrew from it, saying that there was no proper business case. That was brave, when everybody wants it, but there was no business case. At least it understood what was going on, but that is not the case for an awful lot of other people—I have mentioned the ferry to Scilly before, but will not mention that again—and the other side of it is things such as HS2, where the budget goes up through the roof.
My final question to my noble friend—I know he will do it for Report—and a few other people, concerns how you enforce these things when something goes wrong. That is the biggest problem that we have not solved yet. I look forward to the Minister’s reply.
Lord Wallace of Saltaire (LD)
My Lords, I hope the Minister is impressed by the cross-party consensus on a number of things on this issue. At the moment, this is very much a skeleton Bill. The demands to put more in the Bill come from all parts and relate to a number of different clauses. I hope that he will be able to respond outside Committee, between Committee and Report, to consider whether the Government might be able to come back to satisfy some of these requests with appropriate language. As we have already stressed, the language is already there in a number of government publications; it is just not in the Bill. I look forward to his response.
Lord Coaker (Lab)
My Lords, here we go. This is an important part of the Bill dealing with process, and some things have been incredibly difficult to understand. Now we get to things that we can feel. We are talking about purchasing, buying and procurement. We are saying that if we are going to do that, we have a real opportunity as a Parliament—and the Government have a real opportunity, to be fair, but it is going to be driven by some of the amendments here—to use procurement to produce the country and society that we want. Many Governments and local authorities have failed to use the power of that purchasing to drive social change. That is what these amendments are about. I think it is sometimes important to set the context for the various amendments here. I suspect that to an extent there will be a bit of a clash on that because, to be honest, some of us take a position that the free market should be interfered with more than it is. Others take the view that the free market will sort these things out because it will. That is a view, and I think there will be a clash.
Some of these amendments should be in the Bill. The Government will say what they are seeking to achieve. The amendments in this group on the pre-procurement phase are to legislate to enforce it and to make it a reality rather than an aspiration—something that we think would be a good thing to happen. I wanted to say that. I shall wax lyrical at different times to set the context of amendments because otherwise they get lost. Many of the points that have been made on amendments are very important. If I were the Government, I would make more of them. To be frank, the Government may need a bit of advice at the moment. I would not be the person to give it to them, but if I were doing that I would make more of it as a Government, saying that this is what the Government are seeking to achieve, and they will be driven by people in this Committee, and no doubt elsewhere, to go further.
I have a couple of things specifically on the amendments. The noble Baroness, Lady Noakes, will be pleased because this is about a word—I warned them. In Clause 14, which is about the pre-procurement phase, the word “may” is used on a number of occasions. We are discussing what should be in planned procurement notices, which is Clause 14, what should be in preliminary market engagement, which is Clause 15, and what should be in preliminary market engagement notices, which is Clause 16. Those clauses do not insist that the notices are published but say that they “may” be published. Why not have “will” or “must”? The word “must” is used in other clauses in this part, so somewhere along the line, whoever drafted the Bill said, “We will have ‘must’, but in these clauses, we will have ‘may.’” I am always told that this does not make any difference and that the intention is to do that, but why leave it to chance when many of the amendments in this group, ably spoken to by different members of the Committee, are dependent upon a planned procurement notice being published, a preliminary market engagement taking place or a preliminary market engagement notice being published? The amendment could be passed, but it would not make any difference because it only “may” be done, not “must” be done. I hope that is as conflated and convoluted as I get and that the Committee takes the point. I think it would be helpful to the Committee to understand why the word “may” is used in certain clauses and not “must”.
All sorts of really good amendments in this group have been presented to us. I want to make a couple of points about them. My noble friend Lord Hunt, the noble Lord, Lord Aberdare, and the noble Baroness, Lady Boycott, made a point about the role of charities and small businesses, as did the noble Lord, Lord Lansley. Everybody agrees that we have to do more to help small businesses, that we cannot let the big players dominate, that we have to get new entrants and to support them, and asks why we cannot grow business in this area and do more about young people trying to start something. Here is the opportunity. Here is the chance to use procurement to drive the sort of change and make the social difference that we want it to make. The noble Lord, Lord Lansley, is absolutely right that we should use procurement to do it. Other noble Lords who have spoken have made the same point, so it goes all the way through.
The noble Lord, Lord Wallace, is absolutely right about the delivery model for outsourcing that he talked about. One of the disgraces of the last 20 or 30 years is the way in which some things have been forced to be outsourced. I am not an ideological puritan about this; I understand that sometimes it might be the right thing to do—I have got in trouble with my own party for saying that. It is the compulsion to do it that is the problem; where it defies common sense, that is the problem. In those circumstances, the noble Lord, Lord Wallace, and those who support him are quite right to address that.
I was also particularly pleased with the noble Lord’s proposed new subsection (1)(c) in Amendment 81, which I thought he might have emphasised. It talks about outsourcing being able to be brought back in where it is not delivering what it said it was going to deliver. That has been the plague of many things: when something is outsourced and it seems that it is impossible to do anything about it. That is what the amendment seeks to do—another noble Lord in the debate made the point about what you do in those circumstances.
I will just say quickly that I support what the noble Baronesses, Lady Worthington, Lady Verma, Lady Boycott and Lady Parminter, and other noble Lords said on climate change and environmental protection. We need to wake up to this. People say that people are not interested in politics, but they are interested in climate change and environmental degradation, and they cannot understand why something is not being done—why billions of pounds are not used to drive change. This is a real opportunity to do that, and I hope that the Government will take it. No doubt the Government will say that they have all sorts of policies around climate change—Acts, regulations and other things—and that of course they support tackling it. Who does not support trying to do something about climate change and environmental degradation? Everyone supports it. But sometimes the actual will is not there to deliver it through practical policy which will make a real difference. That is the point of the amendment before us.
Lastly, on my noble friend Lord Hunt’s point about disability, I cannot remember the figure from the RNIB briefing—I had a quick look but I cannot remember what it was—but millions of people were potentially impacted.
Lord Wallace of Saltaire (LD)
Flexibility, I think I understand, means a skeleton Bill. I think we all understand that. It will either be in the strategic policy statement, which we will come to, or it needs to be in the Bill. I think that around the Committee, everyone will feel that more ought to be in the Bill than is there now, so that we all know where we are going. If we are not allowed to have a draft of the strategic policy statement before the Bill finishes its passage, that is really not adequate.
Lord True (Con)
My Lords, I think the noble Lord makes a slightly different point. It is a point of concern, and we discussed it on the earlier group. I understand that how much is in secondary legislation and so on is a concern to noble Lords. When I talk about flexibility, I am talking about a structure that is simple and clear, and does not say, “Before you apply to procurement, you have to do a, b, c, d, e, f, g, h…”. We could probably use up the whole alphabet with the aspirations that we will hear in this Committee before anyone can get past the starting gate that we are discussing now. One needs to bear in mind the need for that sort of flexibility. That is the relative simplicity I am thinking about. However, time is late and I need to respond, not to the debate launched by the noble Lord opposite, but to the amendments.
My noble friend Lady Noakes came forward with a very thoughtful amendment, as always. There has been an outstanding debate, and I will want to study it in Hansard and reflect on everybody’s contributions. My noble friend had a very specific point in relation to estimation of cost and how services should be aggregated. Her probing amendment seeks to establish where the Government are coming from.
The proposed methodology in the Bill for estimating the value of contracts, which allows some flexibility, is very similar to the long-standing valuation rules in existing regulations and will therefore be helpful to procurers. Paragraph 4 of Schedule 3 contains an “anti-avoidance” provision that is designed to ensure that contracting authorities do not artificially subdivide procurements in order to evade the rules. This mirrors an analogous concept in the long-standing regulatory scheme but we think that it is presented in a simpler and more user-friendly way. It involves a general rule that contracting authorities should, where possible, seek to aggregate for the purposes of valuation but, as my noble friend said, it also permits exceptions where there are good reasons. Without the “good reasons” exception, the provision becomes something of a blunt instrument.
My noble friend asked for some examples so I will give one: an authority buying its printers from a particular supplier does not necessarily mean that it should buy all its toner, paper and servicing from the same supplier if it believes that it can get a better deal elsewhere. We believe that contracting authorities need to continue to have discretion not to aggregate where they have good reasons not to do so. I will look carefully at my noble friend’s point about the overall estimation of costs but we do not believe that it would be desirable to set out in legislation what constitutes a good reason because this will depend on the circumstances of each case. I request that this amendment be withdrawn.
Amendment 81, tabled by the noble Lord, Lord Wallace, seeks to add elements from the Government’s Sourcing Playbook as a new clause before Clause 14 to require contracting authorities to conduct a “delivery model assessment” when introducing “significant change” in their business model, helping to inform strategic decisions on insourcing and outsourcing. I agree with the noble Lord that rigorous assessment of contracting authorities’ plans is essential for good delivery. However, again, we have continuously sought throughout the development of the Bill to ensure that it remains flexible and does not unnecessarily stipulate blanket requirements, which tie contracting authorities down to a single process that adds unnecessary burdens or will not necessarily work in all cases. For example, “make or buy” decisions, which the noble Lord asked about, need to be considered carefully—indeed, our commercial guidance in playbooks includes comprehensive guidance on this—but, in our submission, it is not necessary for this to be mandated in legislation. Furthermore, large outsourcing contracts will obviously be scrutinised by departmental, Cabinet Office and Treasury controls to ensure value for money and successful delivery.
So we believe that these things should not be mandated by legislation and that this is already achieved through the development and implementation of the sourcing playbooks, which the noble Lord kindly drew our attention to and actually complimented very much with his desire to put them into primary legislation. I am grateful for his endorsement of those principles.
I turn to Amendment 82, tabled by the noble Lords, Lord Hunt of Kings Heath and Lord Aberdare. Some of the underlying arguments on this clause obviously touched on extremely important issues. The amendment proposes to amend Clause 14 to create a presumption that contracting authorities should publish a “planned procurement notice” unless there is good reason not to. Again, I agree that it is vital that the market—particularly certain aspects of it to which the noble Lord and others referred—is given sufficiently early warning of what contracting authorities intend to buy so that suppliers can gear up to deliver. This is particularly important for SMEs and charities, which were referred to by the noble Lord and others.
The Bill makes additional provision to this effect in Part 8. Contracting authorities with an annual procurement spend of more than £100 million will already be required to publish a “pipeline notice”, which will contain information about upcoming procurement with an estimated value of more than £2 million that the contracting authority plans to undertake in the reporting period. This will allow suppliers to see higher-value upcoming procurements and make a decision on whether they wish to bid.
However, contracting authorities should be left to determine where planned procurement notices are useful for lower-value contracts, owing to the potential burden. I will come back to charities. Contracting authorities are incentivised to make use of these notices through a reduction in the tendering period in circumstances in which they are properly issued. They will not necessarily be useful in all circumstances; as such, the Government are currently not of the view that it would be helpful to mandate their use, but I will reflect on what the noble Lord said.
Amendment 84, tabled and interestingly spoken to by my noble friend Lord Lansley, seeks to add to the purposes of “preliminary market engagement” in Clause 15(1). This includes,
“ascertaining how the tender notice may be expressed in terms of outcomes and”
KPIs
“for the purpose of minimising … processes”.
Focusing on the outcomes of the contract, as opposed to being too prescriptive on how these are achieved, is indeed a sensible reason for conducting preliminary engagement—I agree with my noble friend on that. Contracting authorities are encouraged to consider KPIs in their preliminary market engagement. For example, Clause 15(1)(c) includes
“preparing the tender notice and associated tender documents”.
I will look at the Bill against what my noble friend has said, but, as I have said, in some respects the Bill already provides for this and encourages the purpose that he has asked for in terms of Clause 15(1)(c) giving the purpose of preparing the tender notice and documents.
Amendments 85 and 87, tabled by the noble Baroness, Lady Worthington, and others, are important. They provide that, when undertaking “preliminary market engagement”, contracting authorities may engage with suppliers in relation to designing a procurement process that will maximise certain public goods and encourage innovation. I very much hear what noble Lords across the Committee have said about innovation, and I will certainly take that thought away. I think there would be a lot of understanding and support in government for that aspiration; innovative new entrant suppliers should be actively sought out.
We wish to promote and encourage contracting authorities to conduct preliminary market engagement. However, this engagement needs to be appropriate and related to the subsequent procurement. Imposing such an obligation on contracting authorities could have the counterproductive effect of disincentivising preliminary market engagement which, I am sure we all agree, would not be desirable.
Procurement Bill [HL]
Lord Wallace of Saltaire ExcerptsMonday 4th July 2022
(1 year, 10 months ago)
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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?
Lord Wallace of Saltaire (LD)
My Lords, I do not want to prolong the debate. I must say that, having spent the weekend worrying whether I was thick-headed in not understanding the concept of a covered contract, I am relieved to discover that I am by no means alone. In a different tone, we on the Liberal Democrat Benches are very grateful to the Minister for the extremely helpful briefing we had today on the digital platform. That is precisely the sort of relationship we should have as we approach a Bill such as this one.
The Minister should remember that, while the Government are having their own consultations with outside interests, we are doing the same, with rather fewer staff. We have had some very helpful conversations over the past two weeks with various outside interests and groups, and will continue to have others. But, of course, we have had no opportunity to discuss with them the implications of the latest amendments which the Government have tabled. Some 60% of the current amendments are government amendments, and a minority come from outside the Government.
We have heard so far that this Committee is in no sense convinced that Amendment 1 is necessary. We have all struggled to understand why the Government have introduced all these amendments, and some of us have struggled with various other concepts in the Bill. I am grateful to the officials who explained the concept of dynamic markets to me; I am still not entirely sure that I understand the difference between a centralised contracting authority and a contracting authority, and we have tabled an amendment on that. These things are important in getting the Bill through. It takes time and it takes sympathy between the Government and those trying to scrutinise the Bill. As the first House to do this, we are now clearly in some difficulty over where we have got to.
Lord Hope of Craighead (CB)
My Lords, I want to raise a question about the wording of the definition in Amendment 1. I am troubled by the word “covered”. It does not spring off the page as an explanation in itself as to why there is a distinction between procurement pure and simple and this other procurement, described as “covered”. Having looked at the language in paragraphs (a) and (b), I think the obvious word to choose in paragraph (b) is “public” procurement. However, having listened to the analysis of the noble Lord, Lord Lansley, I am doubtful as to whether that distinction is what the definition seeks to describe. But if it is not doing that, and the word “public” would be wrong, is it not possible to find a more obvious word than “covered”?
The choice of language is crucial in a definition clause. It ought to be possible for the reader to take from the definition an immediate explanation as to why there is a distinction between the types of procurement in paragraphs (a) and (b). If it is necessary to go through the hoops that the noble Lord, Lord Lansley, did, I wonder whether it is possible to achieve anything sensible by ordinary language—which is a reason to say it might be better not to have the definition at all. However, if the definition is thought to be necessary, please could a better word than “covered” be found, so that the definition helps us, at the beginning of this complex Bill, to truly understand the distinction between paragraphs (a) and (b)?
Lord Berkeley (Lab)
My Lords, I shall speak to my Amendment 7. I do not think I need comment on any of the other amendments in this group. I tabled this probing amendment to ask why this particular piece of text is here:
“This Act does not apply to Her Majesty acting in her private capacity.”
That is quite unusual in Bills. Usually at the end there is a clause that says something along the lines that Her Majesty and, often, the Duke of Cornwall have given their consent to that piece of legislation. Sometimes when I ask the Minister what relevance the Bill has to the Duke of Cornwall they cannot answer; no one seems able to because it is nicely confidential.
Obviously I can see why Her Majesty acting as the Crown is included in this Bill because effectively the Crown is the Government. However, why is the Duke of Cornwall not included in the Bill in his private capacity? He usually appears alongside Her Majesty. The Duchy of Cornwall has said it is in the private sector, which means, whatever we are going to call it, that it is a private sector organisation that presumably will have to comply with every other part of the Bill.
It is interesting to see where the sovereign grant for transport comes in. I happened to get a Written Answer today. I asked who funded the return charter flight of the Duke of Sussex from the United States for the jubilee. According to media reports, it was the most expensive charter plane that you could possibly get, and it seemed to me that, as in so many of these matters, they could actually have gone on the scheduled service. The answer I had was that it was not funded by the sovereign grant because that
“only covers expenses incurred by other Members of the Royal Family when they undertake official duties on behalf of Her Majesty”,
and clearly that was not the case. When it comes to the sovereign grant and the award of contracts for helicopters or planes across the world that the Royal Family—or even occasionally members of the Government—might take, presumably that will be subject to competitive tendering because they are acting in their public capacity.
It would be good to hear from the Minister what correspondence, if any, took place before Clause 1(9) came into the Bill. Are the Government quite happy with it? I look forward to hearing his answer.
Lord Wallace of Saltaire (LD)
My Lords, my name is on some of these amendments. My colleagues have spoken to several of them so I shall merely add a few things.
I was particularly concerned by the term “centralised”. The context in which we are operating is that England is by far the most centralised country in the developed world. The concept of a centralised procurement authority implies, “Whitehall tells the rest of you what to do”. For that reason, we think it important to put a number of phrases into the Bill emphasising that local authorities have a part to play. In particular, we should put here the idea that consortia of local authorities—for example, the local authorities of West Yorkshire operating together—have the ability to co-operate as centralised procurement authorities.
There will be a number of other occasions in the Bill where I and my colleagues will want to put in social enterprise, social values, non-profits and charities. They were strongly emphasised in the Green Paper and the consultation; they are not in the Bill. We think that including those elements will help to broaden the way in which Ministers and officials will approach outsourcing and public contracting. This relates also to the issues that my noble friend Lord Purvis raised about the international dimension and the importance of trade and co-operation agreements, and the point the noble Baroness, Lady Neville-Rolfe, made about the unbalanced way in which these occasionally operate: we are much more open to others than they are to us.
Lord True (Con)
I was actually coming on to the rest of that but, with respect, the noble Lord asked me a specific question about government communications in his utterance; therefore I was responding to it.
Going further, in line with the existing exemption under the current regime, as provided for in the GPA, partner nations will typically agree to the rules for the award of contracts in a joint project by one or more of the partners in an international agreement. We cannot expect our international contracting partners, each with different national procurement procedures in some cases, to follow the specific procedural rules in this Bill. The ability to switch off the procedural rules in the legislation where there is a clash with what was agreed with the parties to the international agreement is essential to facilitate arrangements; however, I will clarify that further for the noble Lord. Again, I ask that this amendment be withdrawn.
I turn to Amendment 42, which relates to local authorities. I apologise for the length of my speech but a number of different themes came out here. Given my life and my having been involved in setting up joint arrangements with other authorities, I understand where the noble Lord, Lord Wallace, is coming from in seeking to add to and amend Clause 10 to make it explicit that a group of local authorities forming a consortium may constitute a centralised procurement authority. As an old local government hand, I do not particularly like that phrase; on the other hand, earlier, I cited the Yorkshire procurement arrangements as the type of thing that would be permitted and would be a centralised procurement authority.
Lord Wallace of Saltaire (LD)
My Lords, I suggest looking at the definitions in Clause 112. I note that the terms “central government authority”, which clearly does not apply, and “centralised procurement authority” occur together. I suggest that, in introducing an amendment on Report, the Government may care to consider something that replaces “centralised” with “combined”? That would not have the implication of being run from Whitehall and would express much more explicitly what is intended.
Lord True (Con)
I will certainly reflect on anything that is said in Committee. “Combined authority” has a particular meaning and understanding. Local authorities can procure things together without being a combined authority; perhaps the noble Lord, being a good Liberal Democrat, might like to propose a federalised approach. I will take away the point he made. I was going to say that I agree with him and the noble Lord, Lord Scriven, that it is correct that local authorities can band together to form consortia to undertake procurements; that is something we wish to encourage. I will look into the particular case of border lands that the noble Lord—
EU Retained Law
Lord Wallace of Saltaire Excerpts(1 year, 11 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Baroness Chapman of Darlington (Lab)
I am grateful to the Minister for being here to answer questions on this Statement. We wonder about the Government’s priorities in the light of it. After all, yesterday was the day on which the Office for National Statistics announced that inflation had reached 9.1%—the highest level in over 40 years. We think that is of far greater concern for the country than anything in the Statement.
However, perhaps with today being the sixth anniversary of the EU referendum and the Conservative Party desperate not to lose its safe seat in Tiverton and Honiton, we can see why Jacob Rees-Mogg was deployed. The Government have long stated their intention to review retained EU law, and we await further details about the so-called Brexit freedoms Bill, which I am sure many across your Lordships’ House will take an active interest in. It was suggested that this was to be done via a default sunset clause that would delete laws unless Ministers prevented it. Has this madcap plan now been dropped?
Although there will be areas where it will make sense to amend or repeal retained EU law, we should remember that the framework in the 2018 withdrawal Act fed into negotiations on the withdrawal agreement and the TCA. We should have flexibility, yes, but we should also act in good faith.
In another place, the Minister failed to answer questions about the cost of this project, so could the Minister confirm what the costs are? Was the build of the dashboard put out to tender, for example? If so, have details of the contract been published in the usual manner?
In recent years, we have passed the Agriculture Act, the Fisheries Act, the Environment Act, the Subsidy Control Act and many other post-Brexit pieces of legislation. Each of these Acts presented the ideal opportunity to strip away retained law, but Ministers repeatedly chose not to do so. Is that not a sign that much of that body of law is actually highly technical and therefore not as contentious as the Government would like to make us believe?
The Statement speaks of identifying “supply-side reforms” to combat inflation. Have the Government calculated the likely economic benefit to be derived from this programme? If so, perhaps the Minister could share that figure with us. How does it compare to other measures the Government could take to support the economy?
Finally, could the Minister explain how the Government will balance economic and other considerations, such as animal welfare, consumer and environmental benefits? What principles would be applied? The Government lack direction, so how will Ministers know how to approach this task? This whole exercise looks like a gimmick. There is no detail about the Government’s intentions. All we have is a list—calling it a dashboard is stretching it. The best advice we can give Ministers is to focus their energy on interventions that would make a tangible difference to people who are struggling every day to make ends meet.
Lord Wallace of Saltaire (LD)
My Lords, I was not sure whether to laugh or cry when I read the Statement. It takes us into a surreal world of fantastical Government, in which, as the Minister for Brexit Opportunities declares,
“our country will achieve great things.”—[Official Report, Commons, 22/6/22; col. 866.]
That is like Donald Trump promising he will make America great again—just as windy and as empty of content.
There is no evidence behind this Statement. I challenge the Minister to find any. A great deal of evidence was gathered and analysed on exactly this issue between 2012 and 2015 in what was labelled the balance of competences exercise. Eurosceptic Conservatives in the coalition Government believed that an extensive survey of business, sector by sector, would produce a long list of unnecessary Euro regulations that the UK Government could then demand to be renegotiated.
Three Ministers oversaw this exercise: David Lidington, Greg Clark and myself—two Conservatives and a Liberal Democrat. Sector by sector the responses came in, saying that companies were happy with the current balance between domestic and European regulation. Several transport companies argued for greater emphasis on common European regulation rather than less of it. The Scotch Whisky Association, whose then chief executive was David Frost, now the noble Lord, Lord Frost, was particularly enthusiastic about the advantages of common regulation with the European single market. Of course, that was before the noble Lord’s damascene conversion from evidence-based argument to embittered opposition to everything European.
Can the Minister tell us what consultations the Government have conducted in the past year with large and small companies before committing themselves to diverge from EU regulations in the way Mr Rees-Mogg plans? My understanding is that UK exporters, both large and small companies, would much prefer the Government to maintain close alignment between UK regulations and those in our largest overseas market. Does the Minister have any recent evidence to the contrary? Does he understand that the Government have any recent evidence to the contrary?
The chimera of making a bonfire of regulations has appealed to the ideological right ever since Friedrich von Hayek and Milton Friedman. Belief in the superiority of unregulated markets has survived through stark evidence to the contrary, as in the loose regulations that led to the Grenfell fire. Margaret Thatcher understood that a well-regulated market is fundamental to a thriving economy, which is why she pushed for the common regulatory structures of the European single market. British Ministers and officials played a major role in creating that common single market. Many of the regulations that Mr Rees-Mogg is now denouncing were shaped by UK efforts, not imposed by foreign Governments on a powerless UK, as he is now suggesting—but Mr Rees-Mogg’s career has been entirely in finance rather than the real economy of production, marketing and exporting, and much of it offshore in Hong Kong, Singapore and other low-tax financial jurisdictions.
Mr Rees-Mogg is also the Minister for Government Efficiency. He notes in his Statement the extra work that Whitehall officials have undertaken to grasp these “Brexit freedoms”, as he puts it. He does not note that leaving the EU and setting up a range of national regulatory agencies to replace those we shared with our European partners has required a substantial increase in both the number of officials and the costs involved. Part of our contribution to the EU budget went towards funding those common agencies; some of them, such as Europol, were led by British officials. Yet at the same time as being Minister for Efficiency—that wonderfully odd phrase—Mr Rees-Mogg is pushing for a sharp reduction in Civil Service numbers, without regard to the additional tasks that it is taking on. Can the Minister explain how the Government propose to manage this additional effort while slashing the number of staff?
There are more windy comments in the Statement about restoring the sovereignty of Parliament, followed by the declaration that most of this will be pushed through under secondary, even tertiary, legislation, without effective parliamentary scrutiny. The illusion that we now stand imperially sovereign in the world, freed of the European yoke, is punctured by the letter that the noble Lord, Lord Grimstone, circulated yesterday, announcing that we are opening trade negotiations with the Gulf Cooperation Council—in which we will not mention civil or political rights so as to avoid offence. This Government are willing to negotiate and compromise with the GCC but not with our democratic neighbours. Can the Minister explain how giving concessions to the Gulf autocracies avoids limiting UK sovereignty while Mr Rees-Mogg insists that any compromise with the EU infringes on UK sovereignty?
Last night, I wondered whether the Minister might revolt as he attempted to justify this irrational ideological waffle and follow the example of the noble Lord, Lord Agnew, by walking out of the Chamber and the Government mid-Statement. However, I fear that he has not yet reached that point, despite the nonsensical Statement that he is forced to defend.
The Minister of State, Cabinet Office (Lord True) (Con)
My Lords, there has been a rather obsessive theme from the noble Lord, Lord Wallace, today, who seems excited at the prospect that I might walk out of the Government. I can absolutely disabuse him of his expectation of that prospect. Unless the Prime Minister decides otherwise, I shall be extremely content to remain here and take the Brexit freedoms Bill through your Lordships’ House.
Having listened to the noble Lord, on the sixth anniversary of the Brexit referendum, I am inclined to say that the Liberal Democrat Party does not know whether to laugh or cry. His sneering response tells me that the Liberal Democrats, like the Bourbons of Naples, have learned nothing and forgotten nothing in their desperation to keep the United Kingdom in line with the European Union’s orders.
Lord Wallace of Saltaire (LD)
My Lords, I talked about what companies are saying to the Government, and that is about evidence. We are six years down the line from the Brexit referendum; by now we ought to be talking about what sort of relationship we have with the European Union.
Lord True (Con)
My Lords, the noble Lord has had one go, and I think I characterised his party’s position perfectly accurately. The party opposite gave a much more measured response and asked me some specific questions. He asked me one which I shall answer. Again, I am disappointed that, on this sixth anniversary, the Labour Party is still saying that it is not important, in effect, to examine these 2,400 elements of retained EU law, which have a status equal to United Kingdom Acts of Parliament. It is perfectly reasonable that those matters should be examined. My right honourable friend Mr Rees-Mogg made it very clear that it is not necessarily the expectation that all these will be swept away, as the noble Lord said. These matters will be looked at on their merits. Frankly, one of the examples that my right honourable friend gave in the other place was the power of vacuum cleaners. Perhaps if we had more powerful vacuum cleaners in this place, we would not have mice running around the place, gorging themselves on all the bits and pieces of crumbs that are left.
There is a serious issue here, despite what was said opposite. It is perfectly reasonable that departments examine the case for the continuation of this mass of regulations. This is the expectation of departments, in concert with interested parties. The noble Lord asked whether we had done consultation. We have engaged with a range of organisations with interest in retained EU law. We have worked closely with all departments, and their stakeholder groups through them across Whitehall. That engagement has included lawyers, academics, universities and other non-governmental organisations. More recently, it is well known that the Minister for Brexit Opportunities also issued a call to the British public, not I think through an organ widely read on the Benches opposite, on the regulations that they might wish to abolish—particularly focusing, as I think we should, on those that make life harder for small businesses, which shut out competition or simply increase the cost of operating. Through a large number of small changes, we can enact real economic change.
The noble Baroness asked about sunsetting, as she called it, and reports on that matter. The issue to which she referred is still subject to consideration of how the reforms will be carried forward in that respect. So far as the cost is concerned, I assure her that the dashboard was built by Cabinet Office officials using the Tableau software, and was created with no additional cost to Her Majesty’s Government.
As for the benefits, I give an undertaking to the noble Baroness on her perfectly reasonable and proper question that there will be an impact assessment published with the Brexit freedoms Bill when we bring it forward, and that will obviously be laid before your Lordships’ House.
Standards of Behaviour and Honesty in Political Life
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Lord Cormack (Con)
My Lords, it is a very great pleasure to follow the noble Baroness, Lady Meacher. We are all indebted to the noble Lord, Lord Morse, for giving us this opportunity.
I begin by referring to a character mentioned by the noble Lord, Lord Anderson of Swansea, because it helps to put this all into context. The problems we are facing at the moment—I shall come on to these in more detail—are very real, but to have rogue politicians is not new. Most of your Lordships will know the famous story of Maundy Gregory. Sentenced to a prison term, he was sewing his mail bags when he was visited by one of his former colleagues, who asked, “Sewing, Gregory?” “No—reaping”, he replied.
Of course, there have been rogue politicians through the ages, but we are in a different context now, because until relatively recently, we all accepted the basic ground rules. The right reverend Prelate the Bishop of Blackburn also referred to this. Whether believers or not, we had a fundamental Christian structure to our society, where almost everybody accepted that certain things were right and certain things were wrong—certain things were done, and certain things should not be done—although there were those who transgressed. We think perhaps of John Profumo, but what an extraordinary comeback he had by devoting his life to Toynbee Hall and being properly recognised—I think here of the Christian doctrine of redemption—by being given a CBE.
But we are in a different context today. Again, the right reverend Prelate referred to this when he talked about my truth and your truth, rather than the truth which we all held to and accepted. Almost every politician now seems to think that as long he thinks what he is doing is all right, it does not really matter— whether it is telling a fib on the Floor of the House of Commons or watching questionable material on an iPhone. But it does matter, and it is important that we recognise that. We must have a machinery, a structure, for supervising and, to a degree, policing that. I was taken by the very thoughtful speech and suggestion of my noble friend Lord Wolfson, whose dignified letter of resignation is, I hope, framed on the walls of 10 Downing Street.
Lord Cormack (Con)
I live in hope. My noble friend talked about the Lord Chancellor, and about having a Lord Chancellor who is in a destination office. He used the analogy of the station. We are shortly going to be saying goodbye to the noble and learned Lord, Lord Mackay of Clashfern, one of the most distinguished and distinctive Lord Chancellors we have had. He was always in residence in King’s Cross or St Pancras, but his successors have all got off at Adlestrop. It is very important to recognise that a Lord Chancellor, in a high and exalted position, having taken the oaths to which my noble friend Lord Wolfson referred, can be in a position, to a degree, of moral guardian of the ethics of the Cabinet. Although he would never put it that way, the noble and learned Lord, Lord Mackay of Clashfern, fulfilled that role to a degree. It is very important that we try to restore public confidence in those who hold high office. If we do not, our very democratic structures are at risk.
There has been a great change in the other place since I entered it 52 years ago last Saturday. There were not enough women then, but there were a number of colleagues who had fought in the last war with great distinction and had MCs, and almost everybody in the House had had a successful career somewhere. Even I, entering at the age of 31, had done 10 years in the real world as a schoolmaster, a deputy head and so on. There are far too many these days who come in without having had any experience at all of the real world. They come in very often at the first time of asking—their first election—and many have done nothing outside the party-political arena. They have been spads or assistants to MPs, but they do not properly understand the real world. Because of that, what was a vocation to public service has become a job and a career in itself.
That is really what is behind much of what we are talking of today, but it is not only that. They have dispensed—as I hope we will not in your Lordships’ House—with the hours that enabled the House of Commons to have a collegiate structure. I was sitting in my office last night and at five-something the House was up and they were gone. That did not use to happen and because of that, we were together, collegiately, talking and mixing, as we do in your Lordships’ House at the Long Table. A fortnight in advance of a very important debate, I urge your Lordships to remember what happened in the House of Commons when it lost its collegiate structure and gave up the scrutiny of legislation because of timetabling. All these things are enmeshed, but above all, we have to have standards in public life which enable the electorate to respect those whom they elect.
Lord Wallace of Saltaire (LD)
My Lords, I am reminded listening to this debate of the opening words of Francis Bacon’s essay on truth:
“‘What is truth?’ said jesting Pilate, and would not stay for an answer.”
We know that democracy depends on an open debate about what truth is, and respect for reasoned argument and for evidence. It is partly the move away from that recognition of and respect for reasoned debate, and the search for the appropriate and correct outcome—and I say to the noble Lord, Lord Mann, that one has to admit that the whole debate over Brexit has fed a lot of that movement—that has taken us to where we are now.
It is highly appropriate that this debate should be led by a Cross-Bencher and dominated by Cross-Benchers. They have a role in being non-party and in asking questions about evidence and the quality of the argument which the Government are putting forward. It is part of the deterioration even in this House over the last few years that I have heard senior Conservatives saying, “Well, you know that all the Cross-Benchers are systematically left wing”. I will not name the senior Conservatives who have said that, but some Cross-Benchers know them well.
Of course, that is a general label used to close down political debate. The Higher Education (Freedom of Speech) Bill, which has its Second Reading next Tuesday, is based on Policy Exchange papers which at one point state that 80% of the academic teaching in British universities is left wing. This would puzzle the nearly 35% of scientists who work in universities and many others, but that is what Policy Exchange and the Telegraph have stated on a number of occasions. When judges disagree with the Government, they are dismissed in the Daily Mail and elsewhere as “lefty lawyers”. BBC and Channel 4 public service broadcasters are regularly attacked; I am bored by the number of occasions every week that the Times runs anti-BBC stories. This also happens when the Bishops say anything which is deemed to be political. It seems to have escaped the new right-wing consensus, as it were, that the gospel is systemically left wing in a number of ways, particularly in its clear bias towards the poor and against the rich—but the Bishops are told that they should not mention that.
Dismissal of reasoned argument damages democracy. We have skirted around the issue of written constitutions versus unwritten constitutions. I recall that, when I used to teach the American constitution as a graduate student in an American university, we talked about the importance of having a Government of laws and not of men. However, what we are seeing in the United States at the moment is a Government of laws being tested to the extreme by the politicisation of the courts, by bending the rules and by challenging what the rules have promoted. Good and honest Conservatives in Britain, and there are many, should look across the Atlantic and be as concerned about what is happening there—the damage to democracy and to the idea of a national community—as they are about developments in Poland and Hungary.
A democratic Government depends, ultimately, on the self-constraint of those who lead it. Laws and institutions strengthen these constraints and add transparency and external pressure. Where the self-constraint of political leaders weakens, the case for strengthening and institutionalising external constraints becomes stronger. That is why I support the recommendations of the Committee on Standards in Public Life to institutionalise some of these constraints further.
We all recognise that some politicians are rogues—in all parties. My party has suffered, as well as others. Lloyd George has been mentioned; I had severe problems with Jeremy Thorpe when he was our leader; I did not know enough about Cyril Smith. The importance in every political party is that there are enough people who are concerned about the maintenance of standards, and enough influential people in public life to resist the rogues when they appear.
Since we are talking about public life, this also applies to the role of the media, which in Britain has contributed to the decline in our standards. The Daily Mail has become the Fox News of British life in its denunciation of anyone who disagrees with whatever the government line may be at the present time. The Telegraph is a pinnacle of English nationalism, owned by people who escape British tax by living in the Channel Islands. Culture wars, the dismissal of experts and the constant attacks on the BBC are all damaging the quality of the idea of democracy as a process in which we argue and disagree with each other while also respecting each other’s opinions. The right reverend Prelate the Bishop of Blackburn mentioned the importance of civic education and ensuring that we encourage our public to take an informed approach to politics and public life, not treat them as spectators of a game that is simply played in Westminster.
There has been mention of the role of the House of Commons, the decline of the independent Back-Bencher and the rise of the political professional parachuted into safe seats by central office. Part of what we see has gone wrong is that the Government now have 20% of the membership of the House of Commons on their payroll—140 people. The majority of Conservative MPs who are not on the government payroll voted to dismiss the Prime Minister but, when the King’s friends—to use the 18th-century phrase—are as large a group as that, the Commons ceases to be an effective check on the Government.
Then we come to the role of Ministers and Cabinet government, in which each Cabinet Minister has his sense of responsibility—shared responsibility—from the Government. Ministers should recognise that governing is different from campaigning. Part of what is wrong with this Government is that they seem to think campaigning is all that matters—“Promise them what they like, and forget about it next year.” Patronage is to be used responsibly, not simply to reward friends or donors. Political leadership requires putting hard choices to the public from time to time, not simply relying on easy promises. Responsibility is held to the country and the national interest as much as to the party and the Prime Minister. The acceptance of advice and evidence, even when unwelcome, is a necessary part of a Minister’s role.
The noble Lord, Lord True, is himself a Minister and shares that responsibility, collective and individual. I have listened to him defending each constitutional twist and turn of this Government. I have watched him pushing through the Elections Act, and I am sure that he is aware that the chairman of the Electoral Commission has just stated that the Act makes the Electoral Commission no longer an independent regulator. It is a real weakening of our democratic constraints on an unscrupulous Government in power, and the noble Lord was complicit in that. I have heard him sweeping aside concerns about PPE and test and trace—I have read his reply to the noble Lord, Lord Strasburger, on that subject—and defending inappropriate public appointments. I am sure that the Minister recognises that his responsibility as a Minister is not to be too complicit in allowing standards of public life to decline. I hope that he examines his conscience from time to time on that very point and asks himself what contribution he is making towards restoring higher standards of behaviour and honesty in public life—because, I repeat that, in the last resort, democracy is sustained only by the leadership of those who hold responsibility at the top and their willingness to open and maintain dialogue with their public.
Upholding Standards in Public Life
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Lord True (Con)
My Lords, I am at the disposal of your Lordships’ House but, as the noble Viscount will understand, matters on debates are for the usual channels. Should such a debate be scheduled, I will be happy to answer to your Lordships’ House, as always.
Lord Wallace of Saltaire (LD)
My Lords, the Ministerial Code is clearly vital to maintaining trust between the Civil Service and Ministers. The November 2021 report cited a public opinion poll which suggested
“that 85% of the Senior Civil Service and 90% of Fast Streamers had no confidence in the regulation of the Ministerial Code”.
Does the Minister not think that suggests we have an underlying crisis in the relationship between the Civil Service and No. 10?
Procurement Bill [HL]
Lord Wallace of Saltaire ExcerptsWednesday 25th May 2022
(1 year, 11 months ago)
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Lord Lansley (Con)
My Lords, I am very glad to follow the noble Lord, Lord Stevens. He very helpfully reminded us that we might legislate but it is the Government’s job to execute. The ability with which the execution of policy is carried out is a fundamental part of this. I might also say that, as the noble Lord unfortunately discovered in the particular respect he mentioned, we can legislate but if we leave loopholes we allow the Government to drive coaches and horses through them from time to time. That is why we sometimes have to look very hard at Bills to make sure they very clearly express Parliament’s intentions. Important and detailed as this Bill is—the way my noble friend Lord True very clearly set out the Bill’s intentions was most helpful —as the noble Baroness, Lady Hayman, said, we want constructively now to engage with that and to seek to improve the Bill before we send it to the other place.
In terms of interests, I am a director and adviser to LOW Associates, which is a beneficiary of procurement contracts with the European Union. I have looked quite carefully: we have a number of contracts with the European Commission and we advise on European procurement. Although that gives me experience in this respect, I do not think it gives rise to any direct conflict of interest—but I make the declaration in case anybody wants to check it out.
The noble Lord, Lord Stevens, is absolutely right. Where the NHS is concerned, “light touch” should not mean without proper transparency, processes and the ability to understand what is being bought and why. Indeed, there has been some activity in the NHS that should be paralleled across government. Procurement is increasingly seen as an essential part of the quality of management. That is happening through things such as Getting It Right First Time and the benefit of the report from the noble Lord, Lord Carter of Coles, on procurement in the NHS, which included building a procurement profession inside the NHS, which hardly existed. Right across government, we need chief procurement officers to be seen as often as important as chief financial officers in getting the quality of service and value right.
Because this is Second Reading and time is necessarily short, I will mention just two things—there will be further detail on the Bill—that I want to raise in this debate and that I hope to follow up in Committee and on Report. The Chancellor the Exchequer, in his Spring Statement in March, said that
“over the last 50 years, innovation drove around half the UK’s productivity growth, but since the financial crisis, the rate of increase has slowed more than in other countries. Our lower rate of innovation explains almost all our productivity gap with the United States.”—[Official Report, Commons, 23/3/22; col. 341.]
It is clear from the research that innovation and procurement are intimately related in an economy. Procurement, as a mechanism for fostering innovation in an economy, is probably more important than the grant-led systems that we often focus on. We often operate on the supply side, saying, “We must have more scientists, start-ups and grants for innovation”, but actually we need to remember that the demand side may have at least equal impact, because demand pulls through innovation. The home market—the UK market—in particular can be of additional and significant importance to innovative suppliers, enabling them to establish and bring forward innovation in an economy. Innovation needs to be an essential part of our procurement process.
I acknowledge that the objective of procurement is not innovation but to secure quality and value in public services and to do so in a transparent and fair way. But the consequences of procurement to society are terrifically important. What the noble Baroness and the noble Lord, Lord Fox, were saying about social value is terrifically important. We should acknowledge and understand the externalities of procurement, and, through the legislation, we should tell the public contracting authorities that they should take account of them. There was an interesting exchange on this.
The Government’s national procurement policy statement, published in June 2021, acknowledged that the national priority is social value. In that context, “social value” was defined as
“new businesses, new jobs and new skills; tackling climate change and reducing waste, and improving supplier diversity, innovation and resilience.”
This relates to the point that the noble Lord, Lord Stevens, was making, and to my own point about innovation. These things are all in there, but they are not in the Bill, because the day after the Bill comes into force, the Government could write a new national procurement policy statement.
My initial submission at Second Reading is that government should be very clear that the procurement objectives include not only public benefit but social value, and the latter must be defined in the national procurement policy statement in the ways that we specify in the Bill. I hope to include all those points, including the issues relating to climate change, supply chain resilience and the importance, from my point of view, of procurement-led innovation in the economy.
I will make one other point about treaty state suppliers—this is not the point that was previously made. The International Agreements Committee, of which I am a member, is scrutinising the Australia and New Zealand free trade agreements, which are the first of their kind. The Trade (Australia and New Zealand) Bill has been introduced in the other place, and the purpose of this legislation will be to repeal that when the time comes. So, at the same moment, we have a Bill at each end, with one repealing the other—why is that the case? Looking at the Explanatory Notes to the Bill in the other place, I see that it is clearly because the Government expect that Bill to pass rapidly and this one to pass slowly. Therefore, the consequence is that they need that legislation quickly but will subsequently repeal it using this legislation. This is the way that such legislative matters proceed.
My problem is that Schedule 12 to this Bill simply repeals that legislation. So, if we were to amend the Trade (Australia and New Zealand) Bill at any point in the future, it could—or, in fact, would—be repealed by government by virtue of Schedule 12, so any debate on the Trade (Australia and New Zealand) Bill is pointless. I hope that we make sure that that does not happen. We must therefore have a serious debate about whether we are happy for future free trade agreements with procurement chapters to be implemented solely by secondary, rather than primary, legislation. We had this debate on the Trade Act, and I think that we will need to come back to it.
Overall, this is an important Bill, very well introduced by my noble friend—
Lord Lansley (Con)
Forgive me—it was actually added to Schedule 9. But I am referring to paragraph 3 in Schedule 11, on repeals. None the less, I welcome the Bill and look forward to our debates on it.
Lord Wallace of Saltaire (LD)
My Lords, the noble Lord, Lord Maude, remarked that this is a dull subject and implied that we are all rather nerdish to be here. It has been, I think, a constructively nerdish debate. I admit that I have learned quite a lot about the problems of public procurement from working with the noble Lord, Lord Maude. I disagreed strongly with some of his ideas, but I agreed very strongly with some of them as well. I also shared his frustration that some of his best ideas were blocked by the departmentalism of Whitehall and the argument that each department made, as others do, of “We’re different from the others —besides, I’m the Accountable Officer to Parliament”, and that a number of opportunities for reasonable reform were therefore missed. Procurement is a very dull subject most of the time, but one punctuated by scandals when they hit the Daily Mail.
As a revising Chamber, if we are able to work together, our aim in this Bill should be to provide a framework which can outlast the present Government and to provide a stable, long-term environment for contracting between different parts of government and outside suppliers. The Minister will recognise that I say that with particular passion, having survived the Elections Act, as it now is, which was a deeply partisan and deeply unsatisfactory Bill which will have to be rewritten by whichever party comes into office after the next election. Let us do this one differently, please.
There is an awful lot of windy Brexiteer rhetoric about “taking back control” and replacing
“the current bureaucratic and process-driven EU regime for public procurement”—
but here we have an unavoidably bureaucratic and process-driven Bill to replace the EU regime. The Bill does not entirely “take back control” because, as we will have to discuss, the UK will still be governed by various international standards and limited by the commitments given in the various trade agreements we are signing with other countries.
What we must focus on is getting the framework and the requisite elements of parliamentary oversight right. I think we all recognise that we cannot do much more than that. The problems of implementation cannot be dealt with very easily in law. The training of national and local civil servants to manage procurement is clearly very important; outside the Bill, I would like to ask the Minister whether we can have some more information about what sort of training is being laid on to improve the quality of procurement at all levels.
There is clearly an excessively complicated contracts process which enables outsourcing companies like Serco and Capita, and the sad Carillion, to write contracts which they therefore win but which they do not actually execute quite as well as others might have done. We are dependent on the success of the digital platform, which we will have to discuss, but its actual execution is clearly out of the hands of anyone in this Chamber, although the noble Lord, Lord Clement-Jones, on our Benches, will want to discuss that a little more.
On parliamentary oversight, there is some very imprecise language, as always, in this Bill: “an appropriate authority” may do this, that and the other. Every time I read that, I thought of the noble Lord, Lord Hodgson, and his committee, and how much he will pounce on the idea that tertiary legislation will be provided by some sort of authority somewhere around or near Whitehall. Clause 12, on the national procurement policy statement, which we have discussed in some detail, states that
“a Minister … must … carry out such consultation as the Minister considers appropriate”
and the statement can be amended or replaced whenever a Minister considers it necessary. Since 2015, Ministers have changed, on average, every 15 months. We have had five or six Cabinet Ministers in various offices since 2015. That is an appalling rate of turnover. It also means that continuity is very hard to get and that parliamentary oversight questioning a Minister, asking why he or she wants to change the policy statement or whatever it may be, is an important part of trying to maintain continuity. We all know that in many areas of procurement, continuity and a long-term perspective are extremely important.
Many of the most attractive reforming ideas in the Green Paper, Transforming Public Procurement, appear only weakly in the Bill. The Green Paper proposes, for example,
“a new flexible procedure that gives buyers freedom to negotiate and innovate to get the best from the private, charity and social enterprise sectors”,
but the charity and social enterprise sectors have almost entirely disappeared from the Bill. The Minister’s letter at the time of First Reading stated that the reforms to the procurement regime would be based on value for money, competition and objective criteria in decision-making, whatever those objective criteria may be. The briefing on Bills in the Queen’s Speech goes further, claiming that the Bill enshrines the principles of public procurement, with value for money first and foremost. We have heard from others in this debate that even the concept of value for money depends on whether you are saying value of money over one year, over five years or, as the manager of Crossrail said on television yesterday, over 60 years. It changes your calculations considerably. However, Clause 11 balances all this by adding as an objective “maximising public benefit”, and Clause 18 refers to the “most advantageous tender”, deliberately changed from previously, when it was the “most economically advantageous tender”—again without spelling out what criteria should come into play.
We will wish to put back in the Bill the language of the Green Paper, which states, for example, in paragraph 89:
“A more sophisticated understanding of different types of value—including social value … wider public policy delivery and whole-life value”
and refers in paragraph 100 to delivering
“greater value through a contract in broader qualitative (including social and environmental) terms”.
In paragraph 39, the Green Paper calls for
“a proportionate delivery model assessment before deciding whether to outsource, insource or re-procure a service thorough evidenced based analysis”.
That is wonderful but, again, why is not the option of insourcing confirmed in the Bill? We are all aware of the failure of water privatisation, for example, to deliver the promise that it would bring a surge of additional investment into the sector to clean up England’s rivers and coastlines. It did not lead to that; it generated high profits for its investors instead.
The Bill is very soft on private utilities, in view of their very mixed record in several sectors. It aims, as Minister told us, to reduce the regulatory burden on private utilities and to reduce transparency requirements to “the minimum required” by international trade agreements. The Bill contains a mechanism to exempt utilities in some sectors, such as ports, from procurement regulation. Even Dominic Raab has now discovered that ports are an important part of our national resilience and security structure. I am therefore not sure that exempting them from that level of supervision is desirable.
The Minister is a good populist. I draw his attention to the Survation poll of voters in the red wall seats captured by the Conservatives in 2019, which showed an overwhelming preference for some form of public ownership and management of water, energy supply, public transport, health and social care services. The Government are not giving their voters what they want.
The case for not automatically assuming that private service companies will provide the best outcome is strongest in the provision of personal services and social care, as the MacAlister report has just shown. The report states bluntly:
“Providing care for children should not be based on profit.”
The horrifying stories in today’s Times about the excessive profits made by convicted criminals through managing social care for children reinforce all of that case. Local authorities may often be the most appropriate provider. One of the most absurd and damaging central government decisions on outsourcing was, at the beginning of the pandemic, to put out the test and trace scheme to two large service companies, one of them based in Florida, which had no idea of local geography or conditions, when local public health officers already had the knowledge and contacts to provide a faster and more effective response. The Minister has a distinguished record in local government. I am sure that he does not share the view of some of his ministerial colleagues that central government should always have the main control of everything that goes on.
Briefings on the Bill all refer to ensuring “greater transparency of data”. We have all learned to be sceptical of government promises of transparency, freedom of information, and so on. Here, too, we shall want to ensure that there is active parliamentary oversight.
The briefings we have received from the Local Government Association and the National Council for Voluntary Organisations contain a number of reasoned criticisms and proposals for amendments which I hope the Government will accept to improve the Bill. I particularly noted the NCVO’s reference to the role that some strategic suppliers play in adding SMEs and charities to their promised supply chains but then not following through by giving them contracts—using charities and SMEs as “bid candy”, as I gather is the phrase. A more critical approach to companies that are skilled in drafting sophisticated contracts but not good at delivery is clearly needed but, again, that is more a matter of changing the negotiation of contracts and improving monitoring than of drafting in the Bill.
There are issues of corruption and of preventing undue political influence, which are touched on in Part 5—Clauses 74 to 76—which we will also need to discuss, despite the remarks of the noble Lord, Lord Moylan. I am not entirely sure that I yet understand the concept of dynamic markets, and I should welcome a further briefing on that.
I end where I began: I hope that, as a group of nerds, we can agree to a considerable degree on what needs to be done, that we can manage to put into the Bill a coherent framework for the future of public procurement, and that the Minister will co-operate with us—I thank him very much for the briefings we have already had and look forward to more—in achieving that objective.
Lord True (Con)
I will indeed write a letter. It is very helpful to have my noble friend write my speeches for me.
I will answer other points but, to conclude, I thank noble Lords for their extremely intelligent, thoughtful and well-considered remarks, which the Government will consider in Committee. Our proposals have been consulted on extensively and we believe that they are common sense, but we can always gain from listening to your Lordships. In that spirit, I hope that your Lordships will support these proposals as they progress through the House.
Lord Wallace of Saltaire (LD)
I do not want to detain the House, but, since my noble friend Lord Strasburger made some serious points about a major contract, could the Minister possibly say that he will undertake to meet him and others to respond to some of the points he made?
Lord True (Con)
The noble Lord made a speech that went wide of the Bill. I will look at what he said in Hansard and respond thereafter. I make no commitment at this point.
Border Checks on Imported Goods: New IT Systems
Lord Wallace of Saltaire Excerpts(1 year, 11 months ago)
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Lord True (Con)
My Lords, as my noble friend will know, consideration is being given to these matters. I will not tread into that in this particular answer, but I can assure him that elements of trust should certainly play a part in any wisely conducted border. That is why my right honourable friend Mr Rees-Mogg has set up a pilot project called Ecosystem of Trust—not my phrase—to work with the private sector. It is designed to prove the concept of trusted supply chains across the board, not simply in relation to Northern Ireland.
Lord Wallace of Saltaire (LD)
My Lords, the Prime Minister promised two-and-a-half years ago to get Brexit done. It seems extremely inefficient that this key element of our future trading relationship with the European Union has to be postponed time and again. Does the Minister not think it is time that the Minister for Government Efficiency has some sharp words with the Minister for Brexit Opportunities?
Lord True (Con)
My Lords, I am sure that my right honourable friend is capable of almost any form of conversation. I repeat: this is not a delay. It is a deliberate decision to take a different approach and part of that decision is that the 2025 target is being brought forward, as I explained to your Lordships earlier.
Elections Bill
Lord Wallace of Saltaire ExcerptsWednesday 27th April 2022
(2 years ago)
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Baroness Altmann (Con)
My Lords, I was not going to speak in this debate, but, having listened very carefully, I am deeply troubled at the idea that we would not try to see whether we can persuade the Minister and Conservative colleagues in the other place, right-thinking Conservatives, that there is a significant risk here of gerrymandering elections—something one would think was impossible to imagine in this country.
I think the House has been done a great service by the noble and learned Lord, Lord Judge, who has challenged us to stand up for what we can see is a significant risk. Indeed, when we think about what happens in the other place with the amendments that we are trying to point out are really important to insert in the Bills that are coming through in these final days, we see that they are not even being sufficiently debated. With a significant majority there is a risk that a Government can try to gather for themselves permanent or long-lasting powers that are not designed for the kinds of constitutional arrangements that we have in this country.
I therefore am finding myself deeply conflicted and troubled as to—in the words of the noble Lord, Lord Carlile—what we are here for if it is not consider, and ask the other place to consider, these matters.
Lord Wallace of Saltaire (LD)
My Lords, briefly, we on these Benches will vote for both amendments on matters of principle, because we believe in constitutional democracy and citizens’ rights. Sadly, throughout our discussions on this Bill, the Minister has resisted attempts to discuss this as a constitutional issue and as a matter of principle. Indeed, as the Bill has gone through the Government have removed this area from the Cabinet Office and put it in with housing and local government under the Department for Levelling Up, so that the Commons committee on constitutional affairs will no longer cover such things as this. I regret that, too; it seems to me entirely improper.
I recall the noble Lord, Lord Hannan, making a very powerful speech some while ago on the importance of process in politics. By “process” I take him to mean the way in which we conduct ourselves in the political world, including the rule of law and institutional checks and balances Those conventions of political life are a fundamental part of democracy. That is what this Bill has failed to reinforce. I think we all recognise that a future Prime Minister or a future Government will have to return to this issue and produce a much better Bill that can command more cross-party support.
The amendment in the name of the noble and learned Lord, Lord Judge, addresses the question of parliamentary sovereignty—not Executive sovereignty. My noble friend Lord Rennard’s amendment addresses the question of the right of every citizen to take part in the political life of the country and not to face unnecessary barriers. One of the many adverse effects of the Bill is that it makes it much easier and without barriers for overseas citizens to vote but more difficult for domestic citizens to vote. That is very odd, not entirely democratic and undesirable.
For those and other reasons, and on matters of constitutional principle, which the revising House should have particular concern for, we will vote for both amendments.
Baroness Hayman of Ullock (Lab)
My Lords, in his opening remarks, the Minister talked about the post-legislative scrutiny that is going to be on the face of the Bill and said that this would include reviewing and monitoring further forms of acceptable ID. He mentioned that the Bill includes the provision to add further acceptable forms. We welcome that. I hold the noble Lord, Lord Willetts, in the highest regard and thank him for pressing the Government in his previous amendment on the importance of furthering the number of IDs that can be used.
Having said all that, we believe, as the noble Lord, Lord Rennard, said in introducing his amendment, that the Government have simply got it wrong on requiring voter ID to be presented at polling stations. We are disappointed and unhappy that there has been absolutely no movement whatever from the Government on this and that they have not wished to include any further accepted forms of ID in the Bill. If the Bill moves forward on ID as it stands, will the Minister provide assurances as to how the requirements for photo voter ID will be introduced, how local government will be supported, and what mitigations will be put in place to ensure that no elector will be disfranchised as a result of the Bill?
We very much welcome the amendments in the name of the noble and learned Lord, Lord Judge, on the Electoral Commission. There is clear concern, right across this House, about the undermining of the independence of the Electoral Commission. I will not go into any detail because we need to move on. The noble and learned Lord clearly laid out why there are still deep concerns in this House. The small amendments that he has offered would resolve these issues and greatly strengthen the Bill before it reaches the statute book. We agree wholeheartedly with what the noble and learned Lord, Lord Judge, is trying to achieve and support his decision to ask the other place to think once again on what is a matter of extreme constitutional importance.