Amendment 36A

Trade Bill - Report (3rd Day) – in the House of Lords at 7:24 pm on 6th January 2021.

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Lord Stevenson of Balmacara:

Moved by Lord Stevenson of Balmacara

36A: Clause 7, page 5, line 9, leave out subsection (4)

Photo of Lord Stevenson of Balmacara Lord Stevenson of Balmacara Opposition Whip (Lords), Shadow Spokesperson (Digital, Culture, Media and Sport), Shadow Spokesperson (Business, Energy and Industrial Strategy and International Trade)

My Lords, the meat of this short group of amendments is in government Amendments 37 to 42, as listed, which cover the main issues we need to debate.

I am sure that the Minister, when he comes to respond, will not be upset with me if I say that I expect him to say that he would not expect, when considering amendments, ever to be in a situation where people were legislating for a second time on an issue that had already been decided in a different Bill. However, a bit like Groundhog Day, that is what we are doing today, because this part of the Bill has already been put into law and exists as the Trade (Disclosure of Information) Act. I am very grateful to the Minister for his letter of 4 January, which answered a number of points that were raised during the very truncated session we had on the Trade (Disclosure of Information) Bill in order that one section of this Bill could be in place from 1 January—although it is intended to be sunsetted as soon as the Trade Bill has received Royal Assent.

Amendment 36A is very limited and I do not expect a very full response to it, because it is not germane to the main issue before us, which is to try to make sure that the Trade (Disclosure of Information) Act, as it now is, contains the same wording, effectively, as will be in the Trade Bill when it receives Royal Assent. We should not impede that, because it is important that we get it right and that the sunset clause takes place.

However, during the debate on the then Trade (Disclosure of Information) Bill, I asked why Clause 7 of the current Bill was not included in the sections relating to disclosure of information which follow Clause 7, particularly those from Clause 8 to Clause 10 in the current Bill. The answer I received was that they dealt with different issues, even though they were also about the disclosure of information required and, indeed, are covered by amendments that follow. The purpose, therefore, of having this amendment at this stage of this Bill is simply to get on the record for response that the Minister made the first time around, in order that we have both parts of the legislation which will end up being in the Trade Bill in sequence and saying the same thing. I beg to move.

Photo of Lord Lansley Lord Lansley Conservative 7:30 pm, 6th January 2021

My Lords, as the noble Lord, Lord Stevenson of Balmacara, said, this short debate follows on from the debate that we had in this House on the Trade (Disclosure of Information) Bill on 17 December. Like the noble Lord, Lord Stevenson, I am most grateful to the Minister for his letter of 4 January.

There are just two things that I want to say following on from that. The first is that I am grateful, but not surprised, that in his letter the Minister said that, although the wording in the amendments that we are now making to the Trade Bill varies slightly from the wording of the clauses in the Trade (Disclosure of Information) Act, the legal effect is exactly the same. I do not think we ever thought that the legal effect would be different. What we find somewhat surprising is that, to achieve the same effect at virtually the same time in two pieces of legislation, the wording is not the same. That was a slightly surprising aspect of the drafting that we were presented with when we saw the Trade (Disclosure of Information) Bill last month.

Secondly, I raised the question of what is meant by, and what is the purpose of, the amendments that put into the Bill the saving provision in Clauses 8 and 9 —that

“nothing in this section authorises the making of a disclosure which … contravenes the data protection legislation” or aspects of the Investigatory Powers Act. The purpose of the government amendments is to ensure that, when these pieces of legislation and their constraints on disclosure are considered, Ministers can also take into account the powers conferred in this clause.

The Minister’s letter refers to the Supreme Court case of the Christian Institute and others v the Lord Advocate in 2016. I have had the chance to read the judgment and it does indeed refer to the situation where there is in effect, under legislative provisions such as the data protection legislation, a statutory gateway that allows those provisions to be escaped from in circumstances where there are powers for disclosure in other enactments. In the absence of these provisions, the data protection legislation and the Investigatory Powers Act might well make it very difficult for the necessary disclosures to be made in certain specific circumstances. Therefore, it allows for them to be seen together.

Paraphrasing, I think, the language of the Supreme Court, it is necessary for anyone wanting to understand the effect of this clause to have this legislation in one hand and the data protection law—indeed, I would add the Investigatory Powers Act—in the other. It does not tell you how any particular instance would be resolved but it does tell you that both must be considered together, and that is entirely reasonable.

The only issue that one is left with when one reads both the legislation and the Supreme Court judgment is that the clauses we are looking at do not say that the disclosures made by public authorities must be necessary and proportionate. Therefore, I think that it would finally close the gap and make matters very clear if the Minister would confirm that, where these disclosures are made, or indeed where further public authorities have information disclosed to them for their trade functions, the disclosures must be necessary and proportionate to meet those functions.

Photo of Baroness Neville-Rolfe Baroness Neville-Rolfe Conservative

My Lords, I welcome the government amendments, which are technical in nature but allow proper co-operation between HMRC and the devolved authorities. As I was not able to be in the House in person during debates on the Trade (Disclosure of Information) Act, I have probably not understood the purpose of Amendment 36A in the name of the noble Lord, Lord Stevenson of Balmacara—but I have a question that perhaps he or my noble friend the Minister could kindly respond to.

I always worry about the wisdom of giving a power to amend primary legislation by order, particularly on the collection or disclosure of information by HMRC, which seems to be the issue in Clause 7(4). As a former international retailer, I know how commercially sensitive such information is and how onerous ill-thought-out form-filling requirements can be. I want to make sure that the power could not be misused by the Executive—we have seen a certain amount of evasion of scrutiny during Covid. I want an assurance from the Minister, assuming that the power to amend primary legislation is retained in what is now being proposed, that the power would be used sensibly. If it disappears, then that would also meet my concern.

Photo of Lord Purvis of Tweed Lord Purvis of Tweed Liberal Democrat Lords Spokesperson (International Trade)

My Lords, anybody seeking to follow this Trade Bill, including the Bill that we had before Christmas, will struggle to follow the three elements through a natural progression—but we are grateful to the noble Lord, Lord Lansley, for his forensic skill. He has been able to assist in the scrutiny of this, and the questions he asks are very valid. I am glad the noble Lord, Lord Stevenson, has brought forward his amendment, and I look forward to the response from the Government and the Minister. Like others, I welcome the Minister’s very full letter in response to the debate that we had on that fast-tracked piece of legislation.

There are a couple of areas that are still troubling me, and I hope the Minister will be able to explain those. I am happy with his explanation that it is purely a matter of parliamentary drafting, with the same legal effect. I will use this ad nauseam in my future career in this House, when it comes to any Ministers quibbling over the drafting of any amendments that I bring forward. I will say that it is purely drafting, with the same legal effect—so, speaking personally, I am very happy that that precedent has been set.

I am glad that the amendments to this Bill, which will effectively become the successor to the fast-tracked Bill, reference HMRC sharing information with the devolved Administrations. This goes back to the very first time we discussed these amendments, so I am happy and pleased that the Government have indicated their support for that.

However, I am interested in the language of Amendment 37, which I welcome, when it states:

“facilitating the exercise by a devolved authority of the authority’s functions relating to trade”.

Can the Minister outline what these are? In the previous group, on consulting the devolved Administrations on trade agreements, the noble Viscount, Lord Younger, was at pains to stress—and was accurate—that, under the Scotland Act and others, trade, as far as international relations are concerned, is a reserved matter.

However, we all know that there are “functions relating to trade” in the devolved Administrations; we know this for certain because it will be in the Bill. HMRC will facilitate the exercise of those functions by the powers under what will be this Act. I would be grateful if the Minister could outline what those “functions relating to trade” are; it would be helpful to us to know the extent of the Government’s position as regards what responsibilities for trade the devolved Administrations have.

Another thing still niggling me is referenced in the Minister’s letter. I have asked on a number of occasions why it was not more straightforward to put authorities that are linked with the ports and their access routes, in Scotland in particular, under those areas in the Bill. The Government have said that the powers were needed in England primarily, as the Minister’s letter stated, because those authorities were identified as the ones facing the greatest disruption at the end of the transition period, but this legislation is now for the long term and this data will also be shared with the WTO and other international bodies.

The Government have said that if it becomes necessary to add an authority in a devolved Administration country, they can use order-making powers to do it, but in subsection (4) there is a reference to an offence in Scotland for a non-existing authority breaching the disclosing information powers, and it carries a term not exceeding 12 months, so for a body that is not included in the legislation it is a 12-month prison sentence for disclosing information. That happens to be twice the length of time that it will now be in England, under government Amendment 40, which is six months. I do not know why that is the case, so perhaps the Minister can explain. There seems to be a ghost criminal offence created by this legislation that does not impact on anybody and is twice as much as it is in England. I just do not understand why.

I hope that the Minister can respond. I will certainly be supporting these amendments. The letter was very helpful and gave the process for indicating when the sunset clause will kick in for the legislation that we passed before Christmas, and given that this legislation is now for the very long term I hope that the Minister can respond to the points that have been raised.

Photo of Lord Grimstone of Boscobel Lord Grimstone of Boscobel The Minister of State, Department for International Trade, The Minister of State, Department for Business, Energy and Industrial Strategy

My Lords, I am perpetually grateful to the noble Lord, Lord Stevenson of Balmacara, for his contribution to the discussion of this Bill. Turning to Amendment 36A, in the noble Lord’s name, I am sure that noble Lords will agree that for the Government to grow and strengthen the UK’s export capability, we need a clear understanding of the UK’s exporters. This would ensure that the work we do is targeted and tailored to the businesses where it will deliver the maximum benefit.

Clause 7 sets out the powers needed for the Government to collect data to establish the number and identity of UK businesses exporting goods and services, particularly the smaller businesses and sole traders that may not be readily identifiable from existing data, and where the Government can provide a helping hand, something of course which the Government enjoy doing, so that they can reach new markets.

Amendment 36A to remove Clause 7(4) would restrict the ability of the Government to fully implement the new voluntary—I stress voluntary—exporter question. A similar amendment was discussed in Committee, when noble Lords raised concerns that secondary legislation should not have the power to change primary legislation. However, to include new questions within the relevant tax return—it is that very specified matter—an affirmative SI will be required to amend the relevant legislation. That is the purpose of Clause 7(4), which provides the necessary powers to do so. I repeat that Clause 7(4) is necessary to ensure that the relevant exporter questions are included, as intended on tax return forms. The practical implementation of this will be a tick box on tax returns which the person filling in the tax return can tick if he wishes to identify himself as an exporter; it is entirely voluntary. On that basis, I ask for the amendment to be withdrawn.

Coming to the government amendments in this group, we debated some of them during the sixth day in Committee on 15 October, when noble Lords, particularly the noble Lord, Lord Grantchester, felt that they could not agree to the changes at that stage. I hope that the confirmation I provided in my letter of 19 October, the debate that we had before Christmas during the passage of the Trade (Disclosure of Information) Act, and my response today will provide reassurance to your Lordships.

This group consists of government amendments that are technical in nature but are important to explain, and I will do my best to do so. On Amendment 37, it has always been our intention that the devolved Administrations should be able to access HMRC information to facilitate the exercise of their trade functions through the powers in this Bill. In direct answer to the noble Lord, Lord Purvis of Tweed, the implementation of trade agreements may of course fall within the delegated powers of the devolved Administrations, but that is of course different from the trade policy. So implementation of a policy may fall within a devolved Administration’s powers whereas the trade policy itself, as a reserved matter, does not.

In discussions with devolved Administration colleagues, they have asked that their ability to receive information is made more explicit in the Bill. Amendment 37 provides that clarity. Amendment 42 is simply a consequence of Amendment 37 and, to aid interpretation, explains what is meant by the term “devolved authority” for the purposes of the Bill.

In Committee my noble friend Lady Neville-Rolfe expressed concern, and she has repeated some of these points today, that the devolved Administrations would be able to access HMRC data under Clause 8, that they may have different trade objectives, and in particular that they may take a different view on the confidentiality of HMRC data. On the first point, I should stress that the clause allows the sharing of data for devolved functions relating to trade only, such as export promotion, so information could not be used in a way that was incompatible with functions falling under the international trade reservations in the devolution statutes.

On the second issue raised by my noble friend, I stress that the devolved Administrations are responsible Governments and take their legal obligations very seriously. The data protection provisions set out in the Bill apply equally to the devolved Administrations, and any onward disclosure could only occur in compliance with that, as well as requiring the consent of HMRC. I confirm to my noble friend Lady Neville-Rolfe that I am sure that these provisions will be used sensibly.

We have worked closely with the devolved Administrations to ensure that the data-sharing gateways in the Bill can also assist them with their devolved functions. In this spirit, the Government have made two further commitments to the devolved Administrations in relation to data sharing in Clause 9 of the Bill in Committee, and in both Houses, during the passage of the equivalent clauses in the Trade (Disclosure of Information) Act, and I am happy to repeat those assurances today.

First, the data shared under Clause 9 will be used by the border operations centre and the Cabinet Office to develop strategic insights. The Cabinet Office is committed to sharing strategic analysis related to the flow of trade where it will support the more effective management of flow through those borders. Secondly, the UK Government commit to consulting the devolved Administrations before any devolved authorities are added to, or removed from, the list of specified authorities that can share data under Clause 9.

In Committee and in considering the Trade (Disclosure of Information) Act—this has also been mentioned today—the noble Lord, Lord Purvis, correctly noted that the list of specified authorities does not currently include devolved bodies. As I noted in my letter following that debate, the public bodies included in the Bill were identified as key sources of information in relation to the immediate requirements of the border operations centre for the end of the transition period, and particularly to monitor flow at the locations where there is the highest risk of disruption to the border. Access to the data held by these authorities is critical for minimising and managing disruption.

The key point is that Clause 9(9) permits a Minister of the Crown to add other public authorities, which include devolved authorities, to the list. Authorities added to the list subsequently are in no way second-class citizens. Once they have been added to the list, they are completely pari passu with those listed in the Bill. It should be noted that, as I mentioned earlier, we are making a commitment to consult the devolved Administrations before any devolved authorities are added to this list.

Government Amendments 38 and 39 are, like Amendment 40, intended to correct a minor drafting error. My noble friend Lord Lansley raised a number of important points in relation to the equivalent clauses when we debated the Trade (Disclosure of Information) Act. Following that debate I provided a more detailed response, which noble Lords have referred to today, outlining the effect of these amendments. In short, their effect is the same in both Clauses 8 and 9—to ensure that the additional words in parentheses apply to both paragraphs in the relevant subsections rather than just the first.

I can confirm to my noble friend Lord Lansley that data protection legislation and investigatory powers legislation authorise disclosure in certain circumstances, including when in exercise of a statutory function. The additional wording makes it explicit that the statutory powers in Clauses 8 and 9 are to be taken into account when determining whether disclosure would contravene data protection legislation or would be prohibited under investigatory powers legislation. In direct answer to my noble friend’s question, I can assure him that the powers will be used only when necessary and proportionate.

Using his forensic skills which we in this House admire so much, my noble friend also correctly noted that the specific wording used to achieve the same effect in the Trade (Disclosure of Information) Act differs from that included in government Amendments 38 and 39. I can reassure the House that this is a difference in drafting but not in effect. Parliamentary counsel—a profession for which I have great respect—is rightly jealous of its professional independence, and occasionally we find that a parliamentary draftsman will prefer the use of one word to another. I am sure your Lordships would not want to constrain their intellectual ability to do so. I can confirm that the intent of the words is the same. I admire the attention to detail shown by the noble Lord, Lord Purvis, in this matter. If his career had taken a different turn, no doubt he would have made a great parliamentary counsel.

Amendment 40 corrects a drafting omission relating to Clause 10(4)(b)(i). This, I think, will answer the question asked by the noble Lord, Lord Purvis, about why there is a difference—between 12 months and six months—between England and Scotland. As I noted in Committee, Clause 10 as currently drafted provides that a person guilty of an offence under the clause is liable on summary conviction in England and Wales to imprisonment for a term not exceeding 12 months, to a fine, or to both. However, until the relevant provisions of the Sentencing Act are commenced, magistrates can only impose a sentence of up to six months’ imprisonment for a single offence in England and Wales. When the relevant sections of the Sentencing Act are commenced, this disparity will disappear.

In other legislation that provides for a maximum penalty of 12 months’ imprisonment on summary conviction, a provision concerning magistrates’ current sentencing powers is included, to provide that that reference to 12 months is to be read as reference to six months until relevant provisions of the Sentencing Act are commenced. That may seem a bit like Alice in Wonderland to noble Lords, but I assure the House that it represents the correct position. This amendment adds a similar provision to this Bill in relation to Clause 10(4)(b)(i). I should also make your Lordships aware that as a consequence of the European Union (Future Relationship) Act 2020, the Government will need to make future minor and technical amendments to this at Third Reading.

The House has previously noted the importance of the ongoing work of government to manage our new trading relationship with the European Union and the rest of the world. I hope that my letter and my remarks have addressed any remaining concerns.

To be clear, the minor and technical amendments that we will bring forward at Third Reading relate entirely to the renumbering of certain paragraphs and do not affect the intent or content of the legislation at all.

I hope that I have addressed any remaining concerns held by noble Lords relating to the clauses being debated. On that basis, I will move government Amendments 37 to 40 and Amendment 42 when the time comes.

Photo of Lord Stevenson of Balmacara Lord Stevenson of Balmacara Opposition Whip (Lords), Shadow Spokesperson (Digital, Culture, Media and Sport), Shadow Spokesperson (Business, Energy and Industrial Strategy and International Trade) 7:45 pm, 6th January 2021

My Lords, I am very grateful to all those who have spoken in this short debate. I started by suggesting that it was Groundhog Day, but we ended up in Alice in Wonderland. We may need to think about another film, play or book to get us through to Third Reading if we are to have even more amendments to this much-amended part of the Bill—and, indeed, two Bills.

I owe the noble Baroness, Lady Neville-Rolfe, an apology for not making it clear what I was at when I tabled Amendment 36A, but I congratulate her on picking up the reason why I picked that particular reference in subsection (4). On the surface it seemed an extraordinary power to take. She might feel, like I do, that the way the Minister responded did not assuage the concern that the Bill takes power to modify an Act of Parliament when all we were told about was making sure that a particular box was ticked in a tax return, for which a statutory instrument would be required. These things did not seem to square up, but given that we will come back at Third Reading I am sure she or I will take this further should we wish to.

The only other person who came out of this discussion badly was my noble friend Lord Grantchester, who I think was inadvertently blamed for making the Minister come back with the amendments on Report that he thought he had put through in Committee. It was a long time ago—indeed, it feels like even longer. We actually started Committee on this Bill a second time around—I mean the Trade Bill, not the other Bill—in a Committee Room. I know that it is a convention that amendments made then do not necessarily go into the Bill at that stage, so I thought it was appropriate for this to be brought back on Report. I do not believe that my noble friend Lord Grantchester was in any way to blame, although he might have given expression to the way it happened.

We have more than covered the ground that the amendment would open up. The noble Lord, Lord Lansley, with all his forensic skills, must be satisfied that he has most of the answers he wanted. I certainly have, and I beg leave to withdraw my amendment.

Amendment 36A withdrawn.

Clause 8: Disclosure of information by HMRC