Amendment 24

National Security and Investment Bill - Report – in the House of Lords at 5:15 pm on 15th April 2021.

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Lord West of Spithead:

Moved by Lord West of Spithead

24: Clause 61, page 36, line 15, at end insert “, except for any confidential annex prepared under subsection (2A)”

Photo of Lord West of Spithead Lord West of Spithead Labour

My Lords, I will also speak to my Amendment 33, which is consequential to Amendment 24 and part of it. Both are supported by the noble Lords, Lord Butler of Brockwell, Lord Campbell of Pittenweem and Lord King of Bridgwater —a pretty impressive front row, I think noble Lords will agree. The amendments have general support across the House—I know this from my ex-CDI hat, having gone around and checked. I should make it clear that if the Government are not able to resolve this issue, I intend to test the opinion of the House on these amendments.

In Committee, the question of oversight of the investment security unit was raised—specifically, that the Bill does not allow for any oversight of the sensitive intelligence of its work, and that that oversight should be provided by the Intelligence and Security Committee of Parliament. There are many in this House who have served on the ISC, and who were therefore very concerned—as I was—by some of the misunderstandings about the operation of the ISC put forward by the Minister in Committee and what appeared effectively to be a reneging by the Government on the very clear commitments made to Parliament during the passage of the Justice and Security Act.

I assume that the Government accept that there should be a process for evaluating the national security implications of investment in British companies. That concern was first raised by the ISC. Indeed, the Government have stated that the Bill puts national security concerns at the very heart of the process—so why are those national security concerns which will be at the very heart of the process not to be properly overseen? It would mean the Government avoiding scrutiny of their decisions, and that is precisely what Parliament is here to ensure does not happen.

The Government have said that they expect the intelligence scrutiny to be undertaken by the BEIS Select Committee. With the greatest respect to the BEIS Select Committee, which is eminently qualified to scrutinise the work of BEIS, it cannot provide scrutiny of intelligence, because it cannot have access to all the national security material concerned.

The Minister has argued that the BEIS Select Committee does have access to sensitive material, and I grant that, in theory, that may be the case. The Osmotherly Rules allow the Minister discretion to give Select Committees top secret information. In practice, however, that is not the case. We know that the BEIS Select Committee has not been given any top secret information—sensitive information perhaps, but not top secret information. The reality is that it cannot be given top secret information. The BEIS Select Committee, with its excellent chairman, members and staff, cannot be given top secret material because it does not have the requisite security apparatus in place to do so. The committee’s staff do not have the security clearance required to see such material, and the committee does not have the facilities to store or discuss top secret information or have a statutory process to safeguard against the publication of top secret material. Therefore, unless the Government are intending to break their own rules on the handling of top secret material—something that would prompt an ISC inquiry in itself— the BEIS Select Committee cannot provide the scrutiny required. It cannot consider the national security material at the heart of the decision, and therefore the decision itself.

Now that we have established that the BEIS Select Committee cannot in practice be given the top secret material in question, and therefore cannot provide oversight, the question is, who can? Fortunately, the Government and Parliament had the foresight to create a body which can be given top secret material on a regular basis because it does have the requisite security apparatus in place. In 1994, the Intelligence and Security Committee was established expressly to scrutinise the intelligence and security activities of Her Majesty’s Government.

The ISC’s remit was extended through the Justice and Security Act 2013. Noble Lords will have heard it said during earlier stages in this House that the JSA provides the ISC with oversight of the three intelligence agencies. That is, perhaps, a little misleading. The ISC does not only oversee the agencies: it was established to oversee all intelligence and security matters across Government—or at least that was what Parliament was told.

The long title of the Justice and Security Act is,

“An Act to provide for oversight of the Security Service, the Secret Intelligence Service, the Government Communications Headquarters and other activities relating to intelligence or security matters”.

The memorandum of understanding which sits underneath the JSA, and which was expressly agreed by the Prime Minister, says that this means,

“those parts of Departments whose work is directly concerned with intelligence and security matters”.

Both Parliament in the JSA, and the Government in the MoU, have already expressly agreed that the ISC has oversight of all intelligence and security matters across Government.

In case there can be any lingering doubt, I draw your attention to the commitment given by the then Security Minister during the passage of the Bill when he said that it was,

“the intention of the Government that the ISC should have oversight of substantively all of central Government’s intelligence and security activities to be realised now and in the future”.

I trust the Minister has noted the wording there: “now and in the future”.

At the time the MOU was written there were seven such organisations, and these are therefore listed in the MOU. The then Security Minister also made it very clear during the passage of the Bill that the MOU was intended to be updated. He told Parliament:

“Things change over time. Departments reorganise. The functions undertaken by a Department one year may be undertaken by another the following year. The intelligence world is no different from any other part of Government ... An MOU is flexible: it can be changed much more easily than primary legislation”.—[Official Report, Commons, Justice and Security Bill (Lords) Committee 31/1/2013; col. 98.]

Clearly, the Minister’s argument that the ISU is not listed in the MoU is irrelevant. That is what the Minister said. His Government have already committed to changing the MOU when necessary in order to ensure the ISC has oversight of all intelligence and security matters. It really could not be any clearer. It is therefore of very grave concern that, despite Parliament’s clear intent and the Government’s clear commitments, oversight is being expressly denied.

The Minister also said that the ISC does not need to be given oversight expressly because the ISC can scrutinise the public report and can ask for other information about the ISU. Again, I am afraid this misses the point entirely. Of course the ISC can ask for information: we can ask for information from any part of the Government, but that does not mean to say that they will give it to us. By contrast, the organisations listed in the MoU—and therefore within the Committee’s remit—are required to provide information to the ISC. This is quite a different proposition, and demonstrates why the ISC should expressly be given oversight.

One last argument that has been put forward is around demarcation. There is concern that the work of BEIS should be overseen by the BEIS Select Committee, and therefore concern that to give the ISC oversight of the work of the ISU would have the ISC parking its tanks on the BEIS Committee’s lawn. This is simply not the case. The ISC chairman has already discussed this with the chairman of the BEIS Committee and they recognise that this issue cannot be overseen by the BEIS Committee and that some accommodation is required.

The ISC already oversees parts of departments that, for the most part, fall to a departmental Select Committee. The OSCT—I think it is now called Homeland Security—in the Home Office is just one such example, and the ISC and HASC have worked harmoniously for some years. I draw the Minister’s attention yet again to the commitments already given in this respect. The MoU clearly states that:

“Only the ISC is in a position to scrutinise effectively the work of the Agencies and of those parts of Departments whose work is directly concerned with intelligence and security”.

This will not affect the wider scrutiny of departments such as the Home Office, FCO and MoD—ditto BEIS —by other parliamentary committees. It really could not be any clearer and the Government have already recognised that demarcation is not a problem. So, I hope the Minister does not seek to put it forward today as an argument against ISC oversight.

I trust that I have demonstrated thus far why proper oversight is needed, why that can only fall to the ISC, why there is no reason for it not to fall to the ISC, and how the Government have already given commitments previously to Parliament that the ISC will oversee these matters. Now perhaps I might explain the amendment I have laid, with the support of the noble Lords I have mentioned. It seeks to provide this missing oversight and thereby enable the Government to honour their commitment.

Clause 61 mandates the Secretary of State to provide an annual report to Parliament. The information in that report is limited, and obviously will not include any sensitive security information. My amendment to Clause 61 would add two further categories of information to that annual report and provides a mechanism for the Secretary of State to redact any of this information from the public report, should it be deemed damaging to national security. That information must be moved into a classified annexe, understandably, which must then be provided to the ISC, thereby ensuring that if Parliament as a whole cannot scrutinise it—which clearly it cannot because of its classification—the ISC can.

Noble Lords will have noticed that this amendment simplifies the amendment I laid in Committee. The ISC has consistently tried to engage with the Government on this issue, to understand their concerns about our approach, and to try to chart a course through. Despite this, the committee and I remain wholly ignorant of the real reason for the Government’s intransigence. The arguments put forth by the Minister in this House in Committee were flawed, I am afraid, as I think I have shown. They cannot therefore be the real reason why the Government appear to be seeking to renege on the commitments given to Parliament during the passage of the Justice and Security Act.

The noble Lord, Lord Butler, has questioned whether there is some deep-seated dislike of the ISC at the heart of Government. Certainly, oversight is not comfortable, but it is not meant to be comfortable. I cannot believe that the Government would prioritise a petty squabble regarding the committee’s Russia report or the chairmanship of the committee over the clear commitments that they have given to Parliament. I am sure that cannot be the case, knowing the Minister as I do. We will therefore see the Government, I hope, honour their commitments today.

To show that I am an unusually flexible naval officer, I wish to reiterate the offer I made to the Government in Committee. If our amendment is unacceptable, for some reason that they have not yet told us, then the alternative is to put the Investment Security Unit into the MoU and provide for oversight by the ISC in that way. The MoU was intended to be a living document; it is very simply amended by way of an exchange of letters between the Prime Minister and the committee chairman. Perhaps the Minister was unaware of the simplicity of the mechanism, when he said that putting the Investment Security Unit into the MoU was a “substantial amendment”.

The Minister may be unaware that in the work of the Investment Security Unit, the unit which currently takes these decisions is the Investment Security Group in the Cabinet Office, and that is currently overseen by the ISC. Therefore, adding the Investment Security Unit to the MoU is not some radical step but simply preserves the status quo, rather than actively removing it from ISC oversight.

The means by which oversight is provided is less important than the end result. What matters is that Parliament must maintain its sight, and its sovereignty, over a crucial part of national security. Despite the various attempts we have heard to argue that the BEIS Select Committee will provide it, the simple fact is that it is only the ISC which can oversee the national security rationale for decisions made. I repeat the wording that the Government agreed:

“only the ISC is in a position to scrutinise effectively ... those parts of Departments whose work is directly concerned with intelligence and security matters ... This will not affect the wider scrutiny of departments … by other parliamentary committees.”

The BEIS Committee will oversee the business element, as is entirely right and proper, and the ISC will oversee the security element and the decision which weighs that security element. Working together, we will therefore ensure that the wide-ranging powers granted under this Bill are exercised as intended.

Security threats are increasing in both number and complexity; we see that all the time. This legislation is part of the Government’s response to that, and I am very glad about the overall thrust of the legislation, but the Government must recognise that if they wish to maintain public confidence in their abilities to protect the UK at this challenging time, they cannot dismantle democratic oversight. They cannot renege on the commitment they gave to Parliament about that oversight. I apologise for the length of this, but I feel very strongly about it. I beg to move.

Photo of Lord Campbell of Pittenweem Lord Campbell of Pittenweem Liberal Democrat Lords Spokesperson (Defence) 5:30 pm, 15th April 2021

My Lords, I was flattered to be included in the front row that my noble friend set out. I have one qualification about it though, and that is that these days, such is the pressure of rugby that the front row is often completely substituted at half-time. But this is a front row that has not been substituted at half-time. I and the noble Lords, Lord Butler and Lord King, have lasted the pace.

It is not necessary for me to expand in any way upon what were, if I may say so, the most compelling arguments put forward by the noble Lord just a moment or two ago. I acknowledge my interest in these matters, having been a member of the Intelligence and Security Committee for seven years, but I am afraid that I take issue with some of the flavour of the correspondence that has passed between some of us on this matter. The dismissal of the amendments, and the arguments that lie behind them, has been, in my respectful view, cavalier and verging on the insulting. This is a fundamental issue and it demanded a more reasoned set of arguments for simply refusing to accept the amendments that have just been so eloquently proposed.

I will say a word or two repeating to some extent what I said in Committee. When Huawei was first raised it was not raised with the Intelligence and Security Committee, as it ought to have been, but officials sent it to the Secretary of State for Trade and Industry. Had the importance and understanding of the Intelligence and Security Committee been properly recognised perhaps some of the difficulties that ultimately presented themselves with Huawei would have been avoided.

The other point I want to make is slightly self-aggrandising, I suppose, but those who have chosen to be members of the Intelligence and Security Committee are carefully vetted. On some occasions, when the leaders of political parties have made nominations, these have been turned down. It is supposed to reflect those with experience and judgment, who can be relied on to accept the onerous responsibility that membership brings. That involves signing the Official Secrets Act and going through the necessary processes attached to it. I do not understand that the BEIS Committee will be subject to that. Although the Secretary of State may offer classified information, the BEIS Committee will not have the statutory rights, as pointed out so eloquently by the noble Lord who last spoke. I fear this is yet another illustration of how the Government believe that, with a docile majority in the House of Commons, they can, if not ignore what happens in this place, at least enter their opposition in the hope, belief and perhaps the knowledge that if it goes back to the other place the Government’s position can be restored.

The last point I want to make is this: what can be more important than issues of national security? What can be more important than ensuring that those charged with oversight are given every opportunity, based on experience and judgment, to consider these issues and reach conclusions? There seems to be no recognition of that in this issue. It is deeply disappointing.

As the noble Lord who introduced the amendment pointed out, there are not only undertakings on the part of the Government but statutory principles to be observed. My submission is that the Government should think again, but they have already said that, irrespective of argument, they will not accept this amendment. They can hardly be surprised, therefore, if those who support it believe that the attitude of the House must now be taken.

Photo of Lord King of Bridgwater Lord King of Bridgwater Conservative

My Lords, in supporting the amendment I will first say how disappointed I am to be here at all. As we have gone through the Bill’s stages the argument has been very clearly made. I think a mistake was made in the original construction of the Bill and there now seems to be a determination not to repair the one problem that exists.

I say this as somebody who strongly supports the Bill. We need to have powers for the Secretary of State to prevent serious loss and threats to our national security. I note my noble friend Lady Neville-Rolfe’s comments, citing some of the pretty valuable businesses that should not have been allowed to go. If wiser counsel had prevailed that could have been prevented. This Bill would have helped that.

The other important thing that the Government have got absolutely right is ensuring that, if we are going to have this Bill and give the Secretary of State these new powers, there has to be proper parliamentary oversight of it. But they either were negligent or perhaps unaware of the important background: there are limitations affecting the operation the BEIS Committee. It is not qualified and will not be able to see any “top secret” information. If anybody on the government side seriously suggests that there could not possibly be any “top secret” information arising in connection with some possible takeover or acquisition, that position is not one they can seriously seek to sustain in a rapidly changing, increasingly technical and pretty dangerous world, as the noble Lord, Lord West, said. This is a pity, because I would like to pay my compliments to the Minister for the way he has handled the Bill. In every other respect it has been a model of parliamentary oversight and the proper review of it.

Referring again to what we now call the front row of the scrum, it seems, if I may say so, that we in your Lordships’ House each come from a different background. I, having been Secretary of State for a number of departments and then, for seven years, chairman of the ISC, was able to see this from both sides and saw the importance of there being, in the end, proper oversight of the intelligence agencies and of the intelligence and information that may be coming to them which government Ministers might be relying on.

Somebody has kindly sent me a copy of the letter sent by Jacob Rees-Mogg to Julian Lewis, and I echo something the noble Lords, Lord Campbell and Lord West, said: it is pretty dismissive and merely says that the committee’s role should not be on an ad-hoc, Bill-by-Bill basis, and that it would be a significant precedent, providing parliamentary oversight of the UK’s intelligence community. Although my noble friend Lord Grimstone paid what may have been a perfectly well-deserved tribute in Committee to the qualities of the BEIS Select Committee, the simple fact is, as my two colleagues have said, it will not be allowed to see any top secret information. It is not cleared for top secret intelligence that comes in, which might, on some occasions, be the key consideration that affects a decision the Secretary of State takes, for which there would then be no parliamentary accountability or oversight.

I have some sympathy with the Minister, because there are others who seem to have dug their heels in on this one, but even at this late stage, the argument does not stack up. A sensible decision by the Government would be to include this limited amendment to an otherwise excellent Bill and get on with it. Otherwise, it is a serious gap, and we could well pay the price for it in the future.

Photo of Lord Butler of Brockwell Lord Butler of Brockwell Crossbench

My Lords, in my rugby-playing days I played in the back row, and I think I am right in saying that the noble Lord, Lord Campbell, played on the wing. However, I am very happy, in this case, to be in the front row with the noble Lords, Lord West, Lord Campbell and Lord King, even though the rules might say that that is one too many.

This is a very important amendment, and the House and the Government have to take it seriously. The noble Lord, Lord West, has made an irrefutable case for the involvement of the ISC, on the basis of what the Government promised Parliament during the passing of the Justice and Security Act and subsequently, and there really can be no answer to that.

I will come to the role of the ISC in a moment, but first I will draw attention to an oddity of Clause 61 in its present form if the amendment moved by the noble Lord, Lord West, is not accepted. We have been discussing the content of that clause, which stipulates that the Secretary of State must make an annual report to each House of Parliament about the exercise of the powers in the Bill. The clause requires that the annual report should cover details in no less than 12 areas, and the Government are now proposing to add to that. So much detail—but all the details are administrative. The clause in its present form omits the essential matter in which Parliament and the public will be interested: namely, the actual decisions of the Secretary of State and the justification for them—the grounds on which they were made. That is an extraordinary omission, and the first part of the amendment moved by the noble Lord, Lord West, puts it right.

The noble Lord’s Amendment 33 requires that, in addition to the matters listed under Clause 61, currently and as it has been expanded today, the annual report must give a summary of the Secretary of State’s actual decisions on final orders and notifications, and the reasons for them, in terms of the underlying national security risk assessment. Of course, it is the decisions themselves and the justification for them that Parliament and the public will want to know about, and it is extraordinary that the list of the matters covered in the annual report, in the Bill as it stands, does not include them. I cannot see how the Government can possibly refuse to put that omission right.

The second part of the amendment is the provision for a confidential report to the ISC, when necessary, containing any details considered too sensitive to be included in the published report. In the debate in Committee, the Minister answering made much of the role of the BEIS Select Committee in another place. He pointed out that it could receive classified information, if necessary. I accept that the Select Committee in the other place must be Parliament’s principal instrument in scrutinising the Government’s use of the powers in the Bill that relate to inward investment. The amendment of the noble Lord, Lord West, provides for a summary of the national risk assessments provided by the Security Service to be published in the annual report, which the BEIS Select Committee will use.

It may be that further unpublished intelligence material can be given to the BEIS Select Committee on a confidential basis, as the Minister suggested in Committee, but, as the noble Lord, Lord West, said today, this misses the point. There is very likely to be relevant intelligence material that is so sensitive that the appropriate body to question the intelligence services about it is the body established by Parliament within the ring of secrecy for that very purpose. Why should the Government rule out a mechanism to provide for that contingency? As the noble Lord, Lord West, said, this is not just a question of security. With the best will in the world, it is not within the competence of the BEIS Committee to establish the validity of intelligence; that is the realm of the ISC.

I remind the House that the amendment of the noble Lord, Lord West, does not require such an annexe in every case, but only in those cases where it is necessary because the underlying information is of such sensitivity that it cannot be published. In that case, the amendment provides that it should be made available to the specialist committee established by Parliament for that purpose, which can then advise Parliament and the BEIS Committee, as appropriate. What can the objection to such a provision possibly be? There can be no valid objection and I urge the Government to accept these necessary and very reasonable amendments. If they do not, the noble Lord, Lord West, has said that he will test the opinion of the House, and I hope that the House will passes the amendments.

Photo of Lord Lansley Lord Lansley Conservative 5:45 pm, 15th April 2021

My Lords, I express my support for the amendments presented by the noble Lord, Lord West of Spithead, and his colleagues. Curiously, we seem to have four on the front row, but I am perfectly happy where I am, because I am quite a big chap and used to play left lock, so that will be fine.

Colleagues will recall that I had an amendment in Committee to extend the remit of the Intelligence and Security Committee under the 2013 Act. I think the place we have reached on Report is right; my amendment was unnecessary and might have led to precisely the criticism which my successor bar five as Leader of the House of Commons has put to the chair of that committee—that it is expanding the role of the committee beyond its original statutory function. Jacob Rees-Mogg has expressed this criticism about where we are now, but I am afraid he is plain wrong. That is precisely not what this amendment seeks to do; it seeks to ensure that the Intelligence and Security Committee can fulfil the role it was given in precisely the terms that the noble Lord, Lord West of Spithead, set out in introducing his two amendments. I very much support him.

I fear the noble Lord, Lord Butler of Brockwell, may have hit on why the Government are resisting this; not for the reasons they have expressed, but because it will enable the quality of some of those decisions to be examined in detail, including with reference to the security risks that must be incorporated into this decision-making. Perhaps they do not wish that to happen, but that is why we have parliamentary oversight and why, in particular, the Intelligence and Security Committee was originally instituted. I was not a Member of the other House at the time it was instituted, but I was director of the Conservative Research Department and my deputy director is now chair of that committee—as my mother would say, as these things go around, they come around. I am very happy to support their role.

I will mention one other thing. He is not with us this afternoon, but in Committee the noble Lord, Lord Janvrin, made an essential point about the Government’s argument that the ISC can go after the information it is looking for and make inquiries of whoever. He said:

“I think we would all argue that effective scrutiny leads to better decision-making. The Minister in another place said that there is nothing to stop the ISC calling for evidence on a specific decision. That may be true, but is it practical? It calls to mind Donald Rumsfeld’s ‘unknown unknowns’: how does the ISC know which decisions to examine in detail? I question whether such a hit-or-miss approach to scrutiny would lead to better decision-making.”—[Official Report, 16/3/21; col. 250.]

We do not want a hit-or-miss approach. Even less, frankly, do we want the ISC to have to go out on fishing expeditions to try to find out on what the intelligence material on which decisions were made was based. I would far rather it was done in a well-constructed manner. I support these amendments for that reason and hope my noble friend, at the very least, will be able to say that the Government will bring back their own amendments at Third Reading to serve this purpose or amend the memorandum of understanding in the right way. If not, I will have to support these amendments this afternoon.

Photo of Lord Fox Lord Fox Liberal Democrat Lords Spokesperson (Business, Energy and Industrial Strategy)

My Lords, the fact that such esteemed Members on all sides of the House have coalesced on this amendment speaks volumes for your Lordships’ concern about this issue.

It has been a heavyweight debate, with all due respect to the four amigos who have been speaking. I will now bring it down to earth with a bit of politics. It has been an authoritative debate and, all other things being equal, we would expect and hope that it causes the Minister not just to listen but to act. However, I fear his hands—metaphorically if not actually—are tied behind his back by other things. A couple of previous speakers mentioned the letter from the Lord President of the Council, Leader of the House of Commons, to wit, the right honourable Mr Jacob Rees-Mogg. This seems to indicate the bindings the Minister is currently under.

In this short tome, as we have heard, Mr Rees-Mogg tells the right honourable Dr Julian Lewis MP, who is, as we know, chairman of the ISC, that decisions regarding committees’ roles and remits should not be made on an ad hoc, Bill-by-Bill basis, and that there needs to be careful consideration.

I suggest this is a patronising view of the proceedings of your Lordships’ House. When have your Lordships’ considerations not been careful? The most reckless behaviour I have seen during the course of this Bill has been the Minister’s wholesale consumption of sugar-based products, so where is the carelessness that the right honourable Member for North East Somerset speaks of? We should be a little outraged by that suggestion.

This Bill is written by BEIS, and it is understandable that BEIS would want to favour its own Select Committee. I am sure that is how we set out along this route. I think it was the noble Lord, Lord Butler, who said that we have set out in the wrong direction. I feel sure that is what happened. Good governance would be to understand that, take advice and make changes.

It would not be so bad if the BEIS Committee had not been so obviously exposed by the comments we have heard today to be the wrong committee to do the security part of the scrutiny of this very important Bill. It is absolutely clear that it is the wrong committee. If the Minister cannot make or promise changes, I believe he can undertake to accurately reflect both the strength of feeling of your Lordships’ House and the facts, rather than the assumption of the facts that appears to be driving the letter that Jacob Rees-Mogg has written.

I ask just one question of the Minister. If the Bill in considered by the Government to be an ad hoc process, what is careful consideration? What does careful consideration look like if it is not the careful scrutiny of legislation?

Photo of Lord Rooker Lord Rooker Labour

My Lords, they did not do rugby at my secondary technical school, and I am only guesting for my noble friend on the front row for this debate. I will be brief, as I do not want to repeat what was said in this debate or in Committee, when I spoke briefly.

As has already been commented, my noble friend Lord West has made an irrefutable case for the amendment. It is quite clear that there is a serious problem here. No one is arguing with the committee in the other place or wants to devalue or undermine the role of elected Members of Parliament and the departmental Select Committees. They have been an enormous success since they were introduced in, I think, the 1980s and early 1990s. But they have a specific role, which does not cover security matters. Parliament and government decided together to form a different structure for that purpose, which is effectively what we are debating today.

With all due respect, I feel sorry for the Minister, because others are making the decisions on this and he is but their messenger and will give us their message. The fact is that no acceptable, reasonable reason has been given by anybody in government for opposing the procedure envisaged in this amendment: that the Intelligence and Security Committee should have oversight of these decisions. We have no reason for it at all.

The noble Lord, Lord Campbell, referred to the Government’s docile majority. We have to be careful about that; we are hoping that docile majority will support your Lordships’ House, so in my view they are obviously all very intelligent, alert parliamentarians, putting the interests of the country and their constituents first. It is very important that we take that on board.

The noble Lord, Lord King of Bridgwater, mentioned the cruciality of parliamentary oversight in respect of the committee he once chaired—indeed, he was the first chair—and made it clear that the Select Committee in the other place that oversees the department’s day-to-day activities cannot possibly have the relevant information put before it in all the cases. One is not arguing that every single case of a takeover or merger will be referred.

The noble Lord, Lord Butler, made the point that of course the principal role of scrutiny of BEIS lies in the Commons with the departmental Select Committee. However, the Government seem to be ruling out the ability for questions to be asked of the security services by opposing the amendment. That cannot be good. He wants to know what the objection is.

The noble Lord, Lord Lansley, referred to the noble Lord, Lord Janvrin. I was going to refer to him, too, because the brief intervention that I made at the end of Committee on 16 March was to follow up on a point that the noble Lord had made. Perhaps I can get the answer now because I did not get one then and the matter has been sitting there for a month. I simply said to the Minister:

“I have a question for him, based essentially on the speech of the noble Lord, Lord Janvrin, which I do not think he referred to. How could rumours about government action in respect of a private company which may be market-sensitive be dealt with to public satisfaction unless the ISC has oversight? It would not matter if the ISC reports were redacted; Parliament would accept that; the media would accept it.”—[Official Report, 16/3/21; col. 259.]

However, businesses out there that are involved in this market-sensitive information would also know that it had been examined at the highest possible level in Parliament by the committee that scrutinises the security services and accept the decision. If the matter is left in the other place to the BEIS Select Committee, when it is known that the committee cannot have the top-secret information, all kinds of rumours may fester in the markets, affecting the companies concerned. How do the Government propose in due course to overcome those issues?

We are out to send a message to the House of Commons, which has the last word on everything. I always say to people outside this House that we are simply a massive sub-committee that has the ability to ask the Commons to think again and again—and again, if the matter is a red-line issue. This is a serious warning that I have to give to my parliamentary colleagues in the Commons from serious people of substance. They include a former First Sea Lord and Chief of Naval Staff, and security adviser to the Prime Minister; a former Defence Secretary and Northern Ireland Secretary who has been chair of the ISC; someone who was a successful lawyer and athlete before becoming a party leader, as well as being an ex-member of the ISC; in Committee, a former principal Private Secretary to Her Majesty the Queen and former member of the ISC; and a former head of the Home Civil Service and Cabinet Office who served five Prime Ministers and is an ex-member of the Intelligence and Security Committee. These are the people who have contributed and drafted these amendments. I am not excluding the noble Lord, Lord Lansley, who served with distinction as a member of the Cabinet, but the point is that the jobs that the others did and their roles were absolutely relevant and spot-on.

The key players in the other place, as I see it, are Johnson, Gove and Rees-Mogg. From a political point of view, those are not people of substance. Shallow, mediocre and trivial is the way in which I would sum them up. That is the issue. We have messages here from people who have been at the front line, and we are simply saying to the Commons, “We want you to think again about this, and the reasons we want you to do so have been deployed in this debate.” They, the Commons, ought to be asking the Government—and no one has had the answer yet, unless we get it from the Minister—what is the Government’s central objection? That is what this is all about and, unless we get an answer from the Minister, I will certainly recommend that my noble friends support my noble friend Lord West in a Division.

Photo of Lord Callanan Lord Callanan Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy) 6:00 pm, 15th April 2021

My Lords, perhaps I may start by welcoming back to the Front Bench the noble Lord, Lord Rooker, who is an extremely adequate substitute, if I might say. It is a delight to see him back and fully recovered from injury.

There have been a lot of analogies about rugby and positions in this debate. I did not really play much rugby in my career, which is probably a good thing, but the occasional time that we played at school, I seemed always to be the hooker, which seemed, in the poor quality of rugby that we played, to be the one in the middle of the scrum being kicked by everybody else—somewhat appropriate in this debate.

I thank the noble Lords, Lord West and Lord Butler, for their Amendments 24 and 33, which would require the Secretary of State to provide additional information on regime decisions, either in the annual report, or, where details are too sensitive to publish, in a confidential annexe to the Intelligence and Security Committee. This information would include summaries of decisions to make final orders or to give final notifications, and summaries of the national security assessments provided by the security services in relation to those decisions.

A number of noble Lords have spoken with such passion and knowledge on this important issue, both in this debate and when we previously discussed amendments in this area during Grand Committee. I am particularly grateful—I say this genuinely—to the noble Lords, Lords West and Lord Butler, for their careful consideration of the words used by my colleague my noble friend Lord Grimstone during Grand Committee, and for their continued pursuit of an amendment that attempts to satisfy all parties.

The noble Lords’ amendment would effectively require the Secretary of State to include material provided by the security services in a confidential annexe. Of course, the ISC is already able to request such information from the security services as part of its long-established scrutiny of those organisations, as is set out in the Justice and Security Act 2013 and its accompanying memorandum of understanding.

I will directly address the issue raised by the noble Lord, Lord West, and others, about the BEIS Select Committee and its access to sensitive or classified information. The Government maintain their view that there is no barrier to the committee handling top-secret or other sensitive material, subject to agreement between the department and the chair of the committee on appropriate handling. As part of its role, the BEIS Select Committee can request information, which may include sensitive material, from the Secretary of State for BEIS, including on the investment security unit’s use of information provided by the intelligence and security agencies. The Select Committee already provides scrutiny of a number of sensitive areas and there are mechanisms in place for them to scrutinise top-secret information of this kind on a case-by-case basis.

The amendment would also require sensitive details to be provided to the ISC of the Secretary of State’s decisions in respect of final notifications given and final orders made, varied, or revoked. As we discussed earlier, the Bill already provides that the Secretary of State must publish details of each final order made, varied, or revoked. The Government have also recognised that providing this information at an aggregate level will be helpful, and Amendment 32 in my name would require the Secretary of State to include the number of final orders varied and revoked in the annual report. Even without Amendment 32, Clause 61 already requires the report to include the number of final orders made. The Secretary of State must also include in his annual report a number of other details pertinent to this amendment. I am confident that this will provide a rich and informed picture of the Government’s work to protect our national security from risks arising from qualifying investments and other acquisitions of control.

As I have said before, for further scrutiny, we welcome the fact that we can follow existing appropriate government procedures for reporting back to Parliament, including through responding to the BEIS Select Committee, which does such an excellent job of scrutinising the work of the department. As the Secretary of State for BEIS said on 13 April, during a session of that committee, the NSI Bill “sits within BEIS” and the powers of the Bill sit with the Secretary of State for BEIS.

The chair of the BEIS Select Committee—who, I remind noble Lords, is an Opposition Member of Parliament—supported the view that his committee should scrutinise the investment security unit as part of its oversight of the department. Therefore, it makes sense that, from a governance perspective, the BEIS committee should be the appropriate scrutinising committee.

As this was discussed at length in Grand Committee, I do not wish to try the patience of the House by repeating the assurance that my noble friend Lord Grimstone, the Minister, provided to the House on the ability of the BEIS Select Committee to request and see materials regarding the work of the investment security unit. Therefore, I hope—it is probably more in hope than expectation—that noble Lords will accept my explanation and feel able to withdraw their amendments.

Photo of Lord West of Spithead Lord West of Spithead Labour

My Lords, I thank all those who had an input in this debate, particularly those supporters. We almost got a full scrum, with the noble Lord, Lord Lansley, added as well—we had a bit of weight there. We are more second than front row, to be quite honest, but I have now found that the Government Minister is actually a hooker, so we have a bit of front row around. As he rightly says, the hooker gets punched by everyone—I am afraid that that is the way that it is going tonight.

I have considerable sympathy for the Minister: I was in that position when I had to argue for 90 days pre-trial detention. Because I am not really a politician, I had actually already said on the “Today” programme that I thought that this was a very dodgy thing to do—and then I had to stand at the Dispatch Box and argue for it. Lo and behold, I am in Guinness World Records for the biggest defeat of the Government since the House ceased being entirely hereditary—so I feel for the Minister.

However, I am afraid I question a couple of the things that he said—for example, the chairman of the BEIS Committee has no objection to my amendment at all, so he was given some wrong information there. I also fear that the Minister has failed to provide an explanation for the Government’s intransigence and indeed seems willing to stop Parliament having a mechanism whereby it can scrutinise highly classified intelligence, based on which key decisions are made. To cut it short—I have spoken for far too long—I therefore have no choice but to test the opinion of the House on this key amendment.

Ayes 296, Noes 232.

Division number 1 National Security and Investment Bill - Report — Amendment 24

Aye: 296 Members of the House of Lords

No: 232 Members of the House of Lords

Ayes: A-Z by last name

Nos: A-Z by last name

Amendment 24 agreed.