Accident resulting from unauthorised alterations or failure to update software

Vehicle Technology and Aviation Bill – in a Public Bill Committee at 2:30 pm on 16th March 2017.

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Photo of Steven Baker Steven Baker Conservative, Wycombe 2:30 pm, 16th March 2017

I beg to move amendment 1, in clause 4, page 3, line 12, leave out “operating system” and insert “software”.

This amendment replaces “operating system” which is too narrow a term. A vehicle may have firmware which is software in non-volatile memory, an operating system which is software in volatile memory, and application software.

With this it will be convenient to discuss the following:

Amendment 2, in clause 4, page 3, line 15, leave out “’s operating system”.

See explanatory statement for amendment 1.

Amendment 3, in clause 4, page 3, line 20, leave out “operating system” and insert “software”.

See explanatory statement for amendment 1.

Amendment 4, in clause 4, page 3, line 23, after “install software updates” add “to the vehicle”.

Amendment 5, in clause 4, page 3, line 29, leave out “operating system” and insert “software”.

See explanatory statement for amendment 1.

Amendment 6, in clause 4, page 3, line 32, leave out “’s operating system”.

See explanatory statement for amendment 1.

Amendment 7, in clause 4, page 3, line 39, leave out “operating system” and insert “software”.

See explanatory statement for amendment 1.

Amendment 8, in clause 7, page 5, line 31, at end insert

““software” in relation to an insured vehicle, means those components of the vehicle’s computer system that are intangible rather than physical, however stored.”

This amendment would add a definition of software.

Photo of Steven Baker Steven Baker Conservative, Wycombe

At last it seems that it was worth studying for that MSc in computer science, not because we shall discuss formal specification using Object-Z, or the state of communicating sequential processes, and not even because of implementation languages, emulation and testing, but because I think it would be appropriate to replace the term “operating system” in clause 4 with the single word “software”. All the amendments in the group are intended to do that.

I should like briefly to elaborate on what I said on Second Reading, to explain why these amendments are necessary to achieve the purpose of the Bill. In the explanatory notes, clause 4 is described very simply:

“This clause ensures that insurers should not have to bear liability to the insured person in some situations where the vehicle’s software or operating system are altered, or not updated.”

That is the purpose of the clause, but subsection (1) refers to

“alterations to the vehicle’s operating system made by the insured person, or with the insured person’s knowledge, that are prohibited under the policy…a failure to install software updates to the vehicle’s operating system”.

I should like to make briefly and, I hope, engagingly the case that that is drafted too narrowly and that, to achieve the purpose of the Bill if it were tested in court, we need to simplify it and use the term “software”.

The “Oxford Dictionary of Computing” defines “operating system” as:

“The set of software products that jointly controls the system resources and the processes using these resources on a computer system.”

That refers to the software that controls the hardware and makes it available to other programs. Opposition Members have gamely tabled amendment 20, which would delete “vehicle’s operating system” and insert

“application software related to the vehicle’s automated function”.

There is great merit in what they are trying to do. Again, the dictionary defines “an applications program” as:

“Any program that is specific to the particular role that a given computer performs within a given organization”— it is talking about business, rather than cars—

“and makes a direct contribution to performing that role.”

Just as I said on Second Reading, it would technically be the application software that did the automated driving in such cars. I therefore fear that if the Government and the Committee were to keep the definition used throughout clause 4 and specify the term “operating systems”, we could find that an unintended conclusion was reached if it was necessary to test the law in court after an accident.

The solution is simple. The “Oxford Dictionary of Computing” defines software as:

“A generic term for those components of a computer system that are intangible rather than physical.”

I propose in amendment 8 that

“‘software’ in relation to an insured vehicle…means those components of the vehicle’s computer system that are intangible rather than physical, however stored.”

Photo of Richard Fuller Richard Fuller Conservative, Bedford

I am grateful to my hon. Friend for his dissertation on software systems, but can he advise me? We want to avoid the problem that we were talking about earlier in trying to define what might happen in the future. New software systems might be created that were unknown at the beginning and software—malware, for example—that was never conceived of when the operating system was developed might be added and somehow find its way into the computer systems of an automated vehicle. Under my hon. Friend’s amendment, how would those adaptations, legal or otherwise, or those new types of software be handled?

Photo of Steven Baker Steven Baker Conservative, Wycombe

I am grateful to my hon. Friend for extending my remarks with his question. The reason why I have included “however stored” is to distinguish software stored in volatile memory from software stored in non-volatile memory, such as a USB key, and to include the firmware used to start up the low-level devices. The term “software” as I have defined it from the “Oxford Dictionary of Computing” is all-encompassing; it includes everything in the computer system that is intangible rather than physical. To answer his question directly, that definition encompasses all the software in the system however it might arise, so it is the maximal definition.

If we go back to making the legislative definition work, what I propose in amendment 1 is to leave out “operating system” and insert “software”. Amendment 2 would delete “’s operating system”, because that phrase is otiose, as a colleague said earlier. Clause 4 would simply read “a failure to install software updates to the vehicle”. I am trying to make this maximal to ensure that the Bill is absolutely clear that all the software in the system must be untampered with and up to date.

Photo of Chris Matheson Chris Matheson Labour, City of Chester

This is simply a question of clarification. Would the clause as the hon. Gentleman sees it include, for example, not just the vehicle but the software on the electronic key that will be used to engage the vehicle?

Photo of Steven Baker Steven Baker Conservative, Wycombe

That is a very good point, and I think that the Bill already deals with it. I shall try to find the right part of the Bill—it does not leap out at me instantly—but I think that it states that updates are as specified by the manufacturer. Perhaps a colleague might find that and intervene. The point is that all the software that should be up to date must be up to date, and it should be as specified by the manufacturer. As I said on Second Reading, I do not think that the House should tightly constrain what is necessary. Unless anyone wishes to correct me, there is only one software engineer on the Committee, and I am certainly seven years out of date. As legislators, we should seek not to constrain but simply to ensure that the legislation is drawn up so as to encompass the entire software system and ensure that the legislation meets its intended purpose.

I hope that the Government will accept amendments 1 to 8, if not today then on Report and having consulted the industry. I am very much aware that we did not take expert evidence on this issue, so I would understand if the Government wished to consult outside the Committee and return to the issue on Report. I should say that due to a lamentable lack of attention to detail on my part, it would be necessary to table a duplicate of my amendment 4 to amend line 41 of clause 4, as my proposed manuscript amendment would have done. I draw that to the Government’s attention. If they want any assistance in preparing amendments for Report, I would be glad to help.

I think that my co-Chair ruled this morning that we would not accept a manuscript amendment. That decision still stands.

Photo of Iain Stewart Iain Stewart Conservative, Milton Keynes South

May I first ask for a point of clarification? I have a few brief comments to make on the clause, but they do not relate directly to my hon. Friend the Member for Wycombe’s amendment. Do you plan to have a separate clause stand part debate?

Thus far, I plan to call a clause stand part debate.

Photo of Iain Stewart Iain Stewart Conservative, Milton Keynes South

Then I shall await that part of the proceedings.

Photo of John Hayes John Hayes Minister of State (Department for Transport)

Regarding the points made by my hon. Friend the Member for Wycombe, I said earlier today and again this afternoon that the essence of our intention with the Bill is to provide a starting point by getting right the insurance provisions for automated vehicles. It is important that we do so with precision. His case is that if we do not get the technical language right, we risk failing to achieve our policy objective. Getting the language wrong would risk insurers not being able effectively to exclude liability in instances where we wish them to be able to do so. Conversely, it would also allow insurers to limit liability in circumstances where we do not intend them to be able to. Although we are working closely with the insurance industry and, as I said this morning before you joined us, Ms Ryan, the industry welcomed the Bill during our evidence sessions on Tuesday, it is important that the signal we send to them and the underpinning legislation reflect the certainty that my hon. Friend advocated in his amendments and his speech in support of them.

The Opposition have tabled amendments in the same area and, I think, recognise that the issue raised by my hon. Friend is significant. I do not know whether the hon. Member for Middlesbrough is going to speak on those amendments—he may choose to. In essence, the message that I want to broadcast is that although we will not accept these amendments today, we recognise their salience. My hon. Friend’s case is certainly well made and well understood by us. He invited us to consider the issue further, and I commit to doing so.

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport

I was not sure whether we were dealing with amendment 20 now, because it speaks to exactly the same area.

At the moment, we are debating amendments 1 to 8.

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport

Although we are in the same territory, I will defer my comments, Ms Ryan.

Photo of Steven Baker Steven Baker Conservative, Wycombe

Given that the Minister wishes to consider the issues and return to them, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport 2:45 pm, 16th March 2017

I beg to move amendment 20, in clause 4, page 3, line 15, leave out “vehicle’s operating system” and insert

“application software related to the vehicle’s automated function”.

This amendment makes clear that insurance liability is limited or excluded where damage is suffered following an accident as a result of failure to update the application software related to the vehicle’s automated function, rather than the whole operating system.

With this it will be convenient to discuss the following:

Amendment 21, in clause 4, page 3, line 17, at end insert

“, provided that the vehicle manufacturer has made all reasonable efforts to—

(i) notify the owner of a vehicle about the need for an update of the vehicle’s operating system,

(ii) provide the relevant update of the vehicle’s operating system to the owner or insured person, and

(iii) arrange for the installation and update of the vehicle’s operating system.”

This amendment ensures that manufacturers have made all reasonable efforts to provide an update to the vehicle’s system for the owner before placing liability on the owner for not updating the software.

New clause 9—Updates to software and operation of automated vehicles—

“The Secretary of State must bring forward regulations to require that automated vehicles cannot operate in automated mode on public roads unless the application software relating to the vehicle’s automated function is up to date.”

This new clause would require the Government to introduce regulations that require automated vehicles to be up to date in order for them to utilise automated functions on public roads.

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport

As we have a software engineer in the room, I bow to his superior knowledge, but I think he has already acknowledged that ours is a bold and perhaps even decent attempt to narrow the definition to the very function—not bad for an old personal injury solicitor. I recognise that we are all trying to be specific about the what the software is intended to do, so I will not detain the Committee long on amendment 20 but rather move on to amendment 21, which is in the same territory but not on the same point. It would add a proviso to exclusions and limitations on an insurance policy, because, as drawn, the policy would simply be void in the event of failure to install the software.

We discussed this subject during our evidence sessions, and I think we were all quite fascinated by how software would ultimately be installed, but we think it proper to oblige the manufacturer to attempt to notify the vehicle’s owner, provide the update and arrange for its installation. If an automated vehicle is to be able to drive itself, it is critical to safety that the software responsible for the driving operation be up to date. No one doubts that.

I do not know whether everyone can say with certainty that their mobile phone or home desktop computer has the latest version of the software installed. If a smartphone or computer is out of date, that is pretty poor, but significant consequences are unlikely; if an automated vehicle’s software is not up to date, the consequences could be catastrophic.

Photo of Steven Baker Steven Baker Conservative, Wycombe

This is a sensible amendment, but I think it suffers from defining in terms of operating systems rather than software. Perhaps the Minister will explain whether the definition needs to be in the Bill, or whether updates could be required under the policy and it should be for insurers to determine how software updates should be installed.

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport

I am grateful to the hon. Gentleman for pointing out the necessary correction. My concern is that there is nothing in the Bill that requires software to be updated. I find that somewhat difficult to understand. These vehicles will be available for use and there will be several iterations of the software updates, so I am staggered that there is nothing to require that to happen. It is almost an assumption—the nature of the beast is such that of course it will be part of the debate—but there is no obligation.

Photo of Thomas Tugendhat Thomas Tugendhat Conservative, Tonbridge and Malling

Many businesses have insurance for business disruption based on their updating cyber-security software for their accountancy models and so on. I am not entirely sure why the hon. Gentleman feels that such a provision is needed in the Bill when it works alongside the insurance element, so in reality the insurance company would provide that check.

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport

I am not entirely sure that, as a matter of course, insurers would check whether the software on all the vehicles they insure is up to date. They might demand that at the outset but I am not sure what mechanism would make sure of it, other than to warn people that otherwise policies would be voided.

Photo of Thomas Tugendhat Thomas Tugendhat Conservative, Tonbridge and Malling

Would not that in many ways be similar to servicing vehicles? My insurance policy, like many others, requires me to service my vehicle, which is about as non-electronic as it is possible to get these days, pretty regularly. The insurance company will not have checked in advance, but if they later find out that an accident was caused because the vehicle was not in a roadworthy condition because I did not maintain it properly, my insurance is invalid. I understand the hon. Gentleman’s point, but not why he believes it should be in the Bill, rather than leaving it to insurance companies to manage.

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport

I think there is a distinction between ordinary, conventional vehicle maintenance arrangements, with which people are familiar, and the requirements of this brand-new environment, where if software fails because critical updates were not installed or it has been infected in some way—I am not an engineer—the consequences can be catastrophic. Mechanical failures may not be picked up, but we have MOT tests and warranties and it may be starkly obvious that something is fundamentally wrong with the vehicle; software failure may not manifest itself so clearly.

Photo of Rob Marris Rob Marris Labour, Wolverhampton South West

Is not part of the problem that we have several players on the scene? We have the manufacturer, the supplier of the vehicle—the main dealer for example—the insurance company, the owner of the vehicle and the driver. Part of the problem is that the owner of the vehicle may not have any contractual nexus with the manufacturer and may not know that the update is available for their software, just as many people may not know that their smartphone can be upgraded from Android Marshmallow to Android Nougat.

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport

The point is well made, so I will not expand on my hon. Friend’s intervention but simply accept it.

In short, that the manufacturer should notify the owner of a vehicle of the need for an update of the vehicle’s operating system or whatever term we settle on, provide the relevant update to the owner or insured person, and arrange for the installation of the update, are reasonable expectations. We are shifting into a completely different model of vehicle ownership. We have already embraced the principles of personal contract plans and everyone in this room will be aware of the potential to migrate to bundled services, which might not be about one person with one vehicle; they might have a variety of options—a small vehicle for the home and a more comfortable vehicle to make longer journeys, such as touring the Scottish highlands.

We are getting into new territory, and it occurs to me that if we want motor vehicles to be sustainable, rather than rapidly obsolescent, it might be eminently sensible if, rather than someone owning and maintaining a vehicle, such maintenance were part of the services they received and the vehicle was ultimately returned to the manufacturer or retailer. We get into issues about extensions on product liability. With every iteration, there are issues around that. We heard from Mr Wong on Tuesday that the manufacturers will no longer support vehicles beyond a particular time. He did not expect the support to carry on for ever. If it was my Toyota Previa with 163,000 miles on the clock after 17 years it would be unsupported, but there we go.

Photo of Rob Marris Rob Marris Labour, Wolverhampton South West

I bet that went round the highlands.

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport

Yes, it did, several times. It is still running, but it is partly rusted to death. The point is that the measure fits in with the new modelling and is entirely consistent, but it must be underpinned by the obligation to take reasonable steps to update the software. Otherwise, we have difficulties. The amendment would not put the manufacturer behind the eight ball if people are determined to avoid updates or interfere with them—far from it—it just sets out a framework that there should be an obligation on them. I recommend the amendment.

New clause 9 is directly related to the amendment. It requires the Secretary of State to make regulations preventing automated vehicles from being operated in automated mode on public roads unless the software for that function is up to date. We addressed the importance of updating earlier in the Committee, so I will not repeat those arguments, but I underline the seriousness of ensuring that the software is up to date. Out-of-date software can present safety risks. Because of the issues surrounding liability, it should not be beyond the wit of man or too difficult to prevent un-updated vehicles being on our roads, and it would make sense to do that. If a vehicle had a serious mechanical fault that could endanger the driver and others, we would not allow it on our roads. It makes sense that an automated vehicle would similarly present an increased safety risk if its operating system was not updated.

Photo of Kit Malthouse Kit Malthouse Conservative, North West Hampshire

I find the hon. Gentleman’s new clause a bit absolute. My experience of updating software is that some updates are critical and some are quite nice to have and may not relate to safety. For instance, with an autonomous car, there might be a software update that tells the car to take a particular angle of bend at a slightly more comfortable speed. That has an impact on comfort; it does not necessarily have an impact on safety. My reading is that the new clause would rule out that car from being authorised to be on the road unless it had that update.

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport

I think there is a difference. The new clause says that the car has to be up to date and fit with the current requirements, but it does not say it has to be the latest software. A software product may have several versions—we are now getting into nice-to-have mode and additional facilities—and the one someone has in their car may be safe and up to date without being the latest. What I am trying to address with the new clause is software that is updated on safety grounds and essential changes to the programming.

Without the new clause, people would be able to take un-updated vehicles on to our roads, either by accident or on purpose. Insurance companies would surely factor the increased risk into premiums, which would be higher as a consequence. For reasons of affordability, it would be sensible to include the new clause in the Bill.

The amendment proposes that the Secretary of State should introduce regulations to prevent an automated vehicle from being operated on public roads unless the application software relating to the vehicles’ automated functions is up to date—not the latest available, but up to date. From a technical standpoint, that should not be too difficult to achieve. Most people with a smartphone or computer are likely to have software that prevents it from being used until it is updated; I am not struck by any reason why a similar mechanism could not be included in automated vehicles. By preventing un-updated vehicles from being used, we would achieve safer roads and cheaper insurance.

One primary benefit of AVs is that they reduce the likelihood of human error, yet one of the few areas in which scope for human error remains—the responsibility for ensuring that software is updated—would not be addressed, even though it would not be difficult to do so. The new clause would address that. I trust that it will have the Committee’s support.

Photo of Steven Baker Steven Baker Conservative, Wycombe 3:00 pm, 16th March 2017

I rise to make two points, one at slightly more length than the other. The first is that the amendment mentions application software. At the risk of labouring this point, there is a stack of software in the car: firmware at the low level, the operating system, which makes the low-level devices usable, and application software on top. We have reached the point where we are all agreed that all the software needs to be up to date.

The second point is one that my hon. Friend the Member for North West Hampshire just made: not all the software is safety-critical. That is an important point, so I will take a moment to consider it. Safety-critical software will almost certainly have been derived from formal specifications, proved safe as it is manufactured and then tested comprehensively before it is deployed. I would hope and expect that any responsible engineer, before putting an automated car out on the road, would have a very high level of confidence that the software was in fact safe to use.

The issue then is that there are often bugs in software, so it is not inconceivable that a safety-critical update might be required, but I would like to think that it would be an edge case. If we were to prevent all cars with an automated function from being on the roads because some software update was required, we might end up defeating our purpose. On one hand, I think it reasonable that all safety-critical software must be up to date; on the other, I think that the amendment probably would not achieve the purpose intended.

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport

The hon. Gentleman is focusing, quite correctly, on “safety-critical”, but is not the software relating to the automated function by definition safety-critical?

Photo of Steven Baker Steven Baker Conservative, Wycombe

The hon. Gentleman makes a good point. I will give way to my hon. Friend the Member for North West Hampshire in a moment if he wishes, but I think that he put his finger on the point very well, not least because he drives a semi-automated car. Imagine my hon. Friend’s Volvo, which requires him to keep his hands on the wheel when it is in semi-automated mode. There could be a software update that allowed him to take his hands off the wheel for an additional five seconds. That is not safety-critical; it is just a variation on the length of time during which it is not necessary to hold the wheel. The point is that such an update would not be critical to the safety of the car’s ability to drive itself—I am grateful to him for indicating assent—but it would be an update related to the software related to the automated function. That is where the amendment falls down. It is possible to conceive of updates that are related to the safety-critical software but not safety-critical. That is where the issue lies.

The other point is that if I have understood correctly, the overall thrust of the Bill, which I welcome, is to be permissive but absolutely clear where liability lies. Drivers know that they are insured whether or not the vehicle is in automated mode. That is the crucial point.

Photo of Steven Baker Steven Baker Conservative, Wycombe

I am grateful to the Minister for indicating assent. The point then becomes that it is between the insurer and the manufacturer to ensure that these vehicles are safe, properly insured and that the risks involved are insurable—in other words, low.

I have in mind skydiving. I like to skydive. The parachute that has saved my life a couple of hundred times was sold to me without warranty for use for any particular purpose—in other words, it is formally a novelty item under the law. However, it seems to keep saving my life, provided I use it properly. I am quite comfortable with that, because I understand that the vendors of the equipment—the container and the parachute—produce good, reliable equipment to which one can reliably trust one’s life.

I rather imagine that, in relation to cars, while it will all be much more formal and the software will be more complicated than the parachute’s, we are in a similar position. Provided everyone understands where the trust and the liability lies, and provided those relationships are correctly defined, so that they can be tested in court, and provided that the arrangements that are in place are understood, we have a basis on which we can proceed. The quite detailed, technical arrangements, which I would suggest we as legislators are not equipped to either foresee or handle at the time, can actually be dealt with in a way that allows innovation, spontaneity and creativity, but within a fixed framework of law that is suitable to the purposes.

If I may say so, that is why I am so excited about the Bill. I think it shows that the Government are embracing a better way of structuring our society that allows for freedom, but within a fixed institutional framework that does not seek to intervene too much. That is why I reject new clause 9. It is very well intentioned, but for the reasons I have set out, I personally cannot accept it today. If the Government wish to achieve a similar intent, they will need to choose a different form of words at the fore.

Photo of Alan Brown Alan Brown Scottish National Party, Kilmarnock and Loudoun

It is a pleasure to serve under your chairmanship, Ms Ryan. I will mainly speak to amendment 21, and I will be brief. To remind the Committee, the amendment relates to clause 4. The title of the clause, “Accident resulting from unauthorised alterations or failure to update software”, implies that software that has not been updated causes an accident. Part 1 of the Bill is about defining the liabilities and responsibilities needed to make insurance practical and able to be rolled out, and to facilitate the roll-out of autonomous vehicles. On that basis, amendment 21 makes a lot of sense to me. In defining liability and responsibility, it clearly sets out that manufacturers have a responsibility to try to make sure that vehicles are updated with the latest software. That is important, and I do not think it should be left to the small print of individual insurance policies. If we are trying to improve consumer confidence going forward, placing an onus on manufacturers to fulfil their responsibilities make sense, and putting that in the Bill would help that. It would facilitate that for insurance companies as well.

New clause 9 complements amendment 21. I take on board the comments about incorporating terminology such as “safety critical” in the new clause; that is something that should be considered going forward as well. I think there is merit in the amendment and the new clause.

Photo of Rob Marris Rob Marris Labour, Wolverhampton South West

As you know, Ms Ryan, Labour Members are particularly sensitive to getting the wording of clause 4 accurate. On new clause 9, I think the hon. Member for Wycombe is quite right; it would be better if, at the end of it, it said something like “up to date as regards safety”, because of the points that have been made on the difference between safety-critical updates and leisure or convenience updates or whatever.

On amendment 21, it may be that the Minister will be able to assure me that we already have a suitable system. I am thinking, for example, of the system in which, providing they can be traced, the current registered keeper of a vehicle in the United Kingdom gets a safety notification from the manufacturer. For example, my hon. Friend the Member for Middlesbrough and I are pleased to drive Toyotas, but Toyota and a number of other manufacturers have a problem because the Japanese supplier of airbags and their ignition devices supplied about 15 million duff ones around the world. Those are gradually being replaced. As the registered keeper of a Toyota, I get a letter from the manufacturer—not from the mainline Toyota dealer from whom I bought it, but from the manufacturer—telling me that in due course this problem will need to be sorted out.

We are all familiar with that process now in relation to safety-critical updates for software introduced by the manufacturer, presumably as a result of its discovering a bug in software, which occasionally happens. We already have a system—for shorthand, “the airbag-type system”—that might read across in terms of the software system, and therefore we would not need amendment 21. However, I would like the Minister’s reassurance on that point, or his acceptance that we do not already have that kind of system as regards safety and therefore we need either amendment 21 or something akin to it.

Photo of John Hayes John Hayes Minister of State (Department for Transport)

The hon. Member for Middlesbrough began this part of our discussion by claiming that he was courageous and then admitting that he was imprecise. Courtesy obliges me to emphasise his courage and not his imprecision, although he also said that he recognised that my hon. Friend the Member for Wycombe has expertise in this field. I have already said that I agree that it is important that we address the issues dealt with in these amendments, which were also highlighted by the comments of the hon. Member for Wolverhampton South West. It seems to me that we can look again at whether this part of this Bill needs the proposed improvements.

In respect of new clause 9 and amendment 21, I suppose the obvious point—I will go on to make less obvious points, or at least I hope they will be less obvious—is that manufacturers should and will ensure that they update software in a way that guarantees safety. That seems to me to be fundamental, but I just do not think that this Bill is the right legislation to do that.

Perhaps I can make a less obvious point—

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport

The Minister heard the evidence from Mr Wong on Tuesday, in which he made it abundantly clear that it would be impractical and totally uneconomic for a manufacturer to maintain software support ad infinitum; there has to be a limit. To assume that there is a manufacturer out there that will just do that forever is perhaps a little dangerous.

Photo of John Hayes John Hayes Minister of State (Department for Transport)

Or even innocent, perhaps, not to say naive. I did not say that, though, did I? What I said was that manufacturers should and will update software so as to guarantee safety. Where safety would be compromised by any change that a manufacturer might make, or where safety was not the result of the original incarnation of what a manufacturer issued, clearly that would be unacceptable, and it would be covered by vehicle standards and other regulatory and legislative mechanisms. It is absolutely right that if a vehicle comes to market, the software, like the other parts of the vehicle—for example the mechanics—is of a kind that passes the necessary tests allowing the car to be sold, purchased and driven safely, and any changes to that vehicle should comply with those core requirements. The idea that we, or indeed the law, would allow a manufacturer to update software in a way that compromised safety is clearly not sensible; we simply would not allow that.

The hon. Gentleman says that a manufacturer might not choose to update software ad infinitum. Indeed, a customer might not want their vehicle changed forever, and as long as the vehicle can be driven safely, that would be a matter for the driver; it is not a matter for us. A vehicle that can be driven safely but does not have all the latest mechanical gadgets or software is not a matter for the Bill, or even for the Government, beyond the existing legislative requirements. It is certainly not something that I would want to address in this legislation.

Photo of Rob Marris Rob Marris Labour, Wolverhampton South West 3:15 pm, 16th March 2017

May I ask the Minister to reconsider that point? As he said, part 1 of the Bill is largely about insurance. Let us imagine that a manufacturer says of an automated vehicle, “We are not going to update the software for a vehicle that is more than 10 years old. We just don’t do that. We are not saying whether it is needed or not, but it has reached the 10-year mark and we will no longer support it.” At that 10-year mark, that vehicle is likely to be uninsurable, because the insurers will say, “We don’t know anything about the software. After 10 years, we don’t know whether it needs updating or not and the manufacturer isn’t telling us—end of story. We are not going to insure a vehicle that is more than 10 years old, or however long the manufacturer selects.”

Photo of John Hayes John Hayes Minister of State (Department for Transport)

We are ranging a little widely, but I must say that the hon. Gentleman is entering the realms of fantasy, to use a phrase often used by Captain Mainwaring of Corporal Jones in that legendary programme, “Dad’s Army”. Insurance models are currently available for all kinds of vehicles of all ages and at all stages of development and iterations—my right hon. Friend the Member for East Yorkshire is a renowned expert on the subject. Some of those vehicles are very ancient indeed and include no modern technology or mechanics, but they are safe, they can be driven safely, and they are insured accordingly. It would be extraordinary if the insurance industry did not develop products that suited vehicles of all ages. They do so now, so why would they not do so in the future?

Photo of Thomas Tugendhat Thomas Tugendhat Conservative, Tonbridge and Malling

The Minister makes an impassioned defence of his point, and he is absolutely right: the market has solutions for these things. It is not necessarily for the state to decree the exact contractual relationship between an insurer and a vehicle manufacturer. It is certainly true that some software solutions, unlike the mechanical solutions that my right hon. Friend the Member for East Yorkshire enjoys, will inevitably become obsolete, just as some computers and telephones have done, but the Bill’s purpose surely cannot be to ensure that no car built from now on is allowed to go obsolete and that all its systems and software must be kept constantly up to date until the last person who wishes to drive it decides no longer to do so.

Photo of John Hayes John Hayes Minister of State (Department for Transport)

Perhaps, having accused my dear friend—not my hon. Friend in parliamentary convention, but my dear friend—the hon. Member for Wolverhampton South West of entering the realms of fantasy—

Photo of John Hayes John Hayes Minister of State (Department for Transport)

He is rising to the occasion. Perhaps I can find a compromise, because it is important that we have a regulatory framework in place that ensures that manufacturers bring safe systems to market and that the process is as simple and effective as possible. I think we can do that, but not necessarily through the Bill or even through primary legislation. There is a good argument that understanding of the kind the hon. Gentleman advocates will emerge from the continuing dialogue that we enjoy with manufacturers and the further frameworks that result from it.

Our public engagement in this process is determined and well funded. We have invested more than £100 million in the research and development of connected and autonomous vehicles. Many of those projects have had a significant component of building public understanding, and part of that has been to explore precisely the issues that are dealt with in the clause and amendments

We have published a series of documents such as “Pathway to Driverless Cars: Proposals to support advanced driver assistance systems and automated vehicle technologies” and “Proposed ultra low emission vehicles measures for inclusion in the Modern Transport Bill”, which hon. Members will be familiar with. With the establishment of the Centre for Connected and Autonomous Vehicles, the programme of work continues. We will work with the industry and academia to ensure that we not only test the behavioural response to all this, but work on where manufacturers’ responsibilities begin and end and how much further legislative action is required. I do accept that, and perhaps we can find a happy middle ground, but I am not sure the Bill is the right place.

I underpin that by drawing the Committee’s attention to the briefing we have had from Ageas, which is the third-largest motor insurer and leading provider of award-winning insurance solutions in the United Kingdom—that sounds a bit like an advert. None the less, Ageas says that:

“The Vehicle Technology and Aviation Bill will establish a new insurance regime for the next generation of autonomous vehicles currently being developed. Ageas is supportive of the Bill as it reflects the extensive discussion that have taken place between the government, insurance industry and other stakeholders.”

It goes on in a similar vein, but for me to amplify it further would seem a little self-congratulatory. I simply ask Members to give it their fullest consideration following this short speech.

Photo of John Hayes John Hayes Minister of State (Department for Transport)

I will happily give way to the hon. Gentleman because I have not been generous enough to the Scottish nationalists—it is against my inclination to be so, but I am changing.

Photo of Alan Brown Alan Brown Scottish National Party, Kilmarnock and Loudoun

I thank the Minister for finally giving way. I appreciate him saying that there may be a middle ground; that gives some sort of hope. Touching on the previous intervention, this is not about the state legislating to stop vehicle software becoming obsolete. Clause 4 is about accidents arising from a failure to update software. That is critical; we are setting out responsibilities and liabilities, and that is why amendment 21 has merit. In terms of worrying about the state, there are 42 lines in clause 4 already and we are only asking for another five or six to be added. It is not too much and not too prescriptive, so I ask the Minister to think carefully about amendment 21.

Photo of John Hayes John Hayes Minister of State (Department for Transport)

Where I agree with the hon. Gentleman is that it is important that the insurance industry is entirely confident about the basis of this legislation. That is why I quoted a leading insurer a moment ago. The essence of their confidence is the creation of the first instance liability on the insurer to settle a claim involving a car in automated mode. That first instance liability will mean that the driver and other parties cannot be adversely affected in the way that the hon. Gentleman suggests. I can see why he said that, and that it was with the best intentions. I am not seeking to undermine his principles, but I do not think we need to do more at this juncture.

Photo of Alan Brown Alan Brown Scottish National Party, Kilmarnock and Loudoun

I thank the Minister for giving way once again. Although he quoted a letter that says the industry are supportive of all this, I request that he asks what they think of the amendment and whether they are happy with it. Rather than saying that they are happy with the Bill as it is, they might see merit in the amendment as well.

Photo of John Hayes John Hayes Minister of State (Department for Transport)

I am always happy to engage with the industry on the basis the hon. Gentleman describes. I am more than happy to include that in our continuing discussions, and it is right that we should continue to have that discussion with the insurance industry.

Photo of Steven Baker Steven Baker Conservative, Wycombe

I say as gently as I can to the hon. Member for Kilmarnock and Loudoun that the problem with amendment 21, as I said earlier, is that the Government cannot accept it in its current form, however long or short it is, because it is phrased in terms of operating systems. I think the hon. Member for Middlesbrough accepted that earlier. Should the Government wish to look at the function of the amendment and bring it forward on Report, I implore them to choose different words.

Photo of John Hayes John Hayes Minister of State (Department for Transport)

Yes. Let me be even kinder to the hon. Member for Kilmarnock and Loudoun than I have tried to be already. Without wishing to put words in his mouth, I do not think that he is arguing for this precise amendment to be made to the Bill—it has been acknowledged that that is not the case. What he and others are arguing is that the spirit of the amendment might add to further consideration. I have said that I think it is important, in regulatory terms, that there is a commitment from manufacturers of the kind that has been described. I essentially agree with my hon. Friend the Member for Wycombe—I used to think that it was me and the Labour party against the free market liberals, but I am very impressed with and reassured by his contribution.

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport

Will the Minister seek that reassurance from the motor manufacturing sector? If he says that will happen, that would make life an awful lot easier.

Photo of John Hayes John Hayes Minister of State (Department for Transport)

I think it would be reasonable for me to say to the manufacturing sector what I have said to the Committee: that a core part of the work on updating systems is ensuring that a framework is put in place that compels manufacturers to bring to market systems that make the process as simple and effective as possible. That is perfectly reasonable. We will certainly have that discussion. I think that regulations are bound to be the consequence of that later; I just do not think that this is the time or the place to do that.

I said this morning, and I will say again—this is so important that I make no excuse for repeating it—that we accept that as this technology develops there will be a need to return to the House, to develop subsequent regulation and consult further. That is very much part of our approach. Of course, in our ongoing discussions about that later regulation I am more than happy to put the case that has been articulated across the Committee.

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport

I think it falls to me to deal with all of the amendments and the new clause, if I am following the procedure correctly.

You can state your intention on the new clause.

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport

I am grateful for that guidance, Ms Ryan. I will turn to amendment 20 and, if I can, encapsulate it with new clause 9. It is my intention to seek leave to withdraw the amendment and the new clause, for the reasons set out by the hon. Member for Wycombe. I think we are as one across the Committee about the need to get the wording absolutely accurate. There is consensus on that, which feeds into the new clause and the amendment. It also has an impact on amendment 21.

I wish to clarify that we are talking about trying to have some balance. Clause 4 describes circumstances where liability may be excluded, which includes a failure to install software. As the hon. Member for Kilmarnock and Loudoun rightly outlined, it is without any consequence and there is no balance to this if it is left as drawn. There is no obligation upon the manufacturer to take any reasonable steps to ensure that the software is updated. It would strike any reasonable observer as entirely out of kilter if it remains as it currently is. I am extremely grateful to the Minister for his undertaking to seek assurances from the industry that it will express a view on the clause and develop a conversation about its obligations to install software. I accept that assurance and beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That the clause stand part of the Bill.

Several hon. Members:

rose—

I expect Members to be brief because we have already had a fairly wide-ranging debate.

Photo of Iain Stewart Iain Stewart Conservative, Milton Keynes South

I will be brief, Ms Ryan. The first part of the clause title is:

“Accident resulting from unauthorised alterations”.

I am perfectly comfortable with the contents of the clause that relate to the owner or driver making alterations themselves, but on Second Reading I flagged up my concern about where the liability lies if an external alteration is made either deliberately or accidentally. By deliberate, I mean the computer system being hacked in some way, the installation of malware or similar problems, and accidental alteration could arise from the car being serviced and the garage mechanic somehow messing up the system. I would like some clarification about where the liability lies in such circumstances. The Minister kindly honoured his promise on Second Reading to write to me.

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport

I wonder whether the answer to the scenario that the hon. Gentleman has described—the realms of uninsurance—is that the Motor Insurers Bureau’s uninsured scheme would come into play. Under the Road Traffic Act 1988, it would be the same insurer who stepped in to resolve the damage suffered by third parties.

Photo of Iain Stewart Iain Stewart Conservative, Milton Keynes South

The hon. Gentleman has anticipated what I was about to say, because the Minister kindly honoured his promise to write to me and gave me the clarification I needed. He said that although future regulations may be made, the current system will apply and ultimately the courts will decide where the liability lies if there was an external intervention. The Motor Insurers Bureau happily resides in my constituency and I visited it a couple a weeks ago, and we discussed that very point. I want to put on the record that the concerns I expressed on Second Reading have been addressed, and I am perfectly content with the clause as it is currently drafted.

Photo of Rob Marris Rob Marris Labour, Wolverhampton South West

I have six fairly brief points. I know that the Minister is a great proponent of using language properly, so at the beginning of line 18 of clause 4(2), may I ask him to remove the first word “But”, which is a conjunction? It adds nothing to the Bill and is a grammatical monstrosity.

Photo of Rob Marris Rob Marris Labour, Wolverhampton South West

What a Minister! Given that he has been so generous to me, I will be generous to him.

On a more serious point, may I draw the Minister’s attention to the beginning of line 23 of clause 4, which states

“knows he or she is required”?

I think that should state “knows or should have known that he or she is required”, because otherwise the person can plead ignorance and there is no “should have known” about it, which is a common construction in law, as my hon. Friend for Middlesbrough will know. Similarly, in line 33, “that an insured person knew or should have known that he was required under the policy” would be legally clearer and help all of us, including insurers. Line 41, subsection 5(b), reads

“which, at the time the person knew he or she was required”.

It ought to be “at the time the person knew or should have known he or she was required”. Having put that forward, I know the Minister will consider it in his usual generous spirit.

More importantly and substantively, there should be a provision in clause 4 on the cost of software updates. I appreciate that clause 4 is principally about insurers and so on, but it is about software updates. If in terms of safety—not the legalities—there is a safety-critical update that the manufacturer decides is going to cost £1,000 to whack in and the insured decides not to do that, that would void his or her insurance policy, but it would also put the rest of us at risk.

That is not a figure plucked out of the air. I might have said in an earlier session that the software to install a sat-nav in my car—just for the software; none of the hardware—costs £600. To update the software for sat-navs in many cars can be £300 or £400. That is just for the software update for a poxy sat-nav, let alone for an automated vehicle.

Photo of Thomas Tugendhat Thomas Tugendhat Conservative, Tonbridge and Malling

The hon. Gentleman is seeking now to regulate the contract between an individual and the car company they buy from in relation to servicing. There are many different updates that are required for a car in terms of safety-critical features, which happen every now and again, such as changing tyres. [Interruption.] Or buying a new set of brakes, as my hon. Friend the Member for North West Hampshire says. Each different manufacturer has a different price list. If someone wants to buy a Rolls Royce, they can be pretty sure that the price of the items will be very high. I chose not to—there were several reasons for that, not least that child seats do not fit very well. Rather more fundamentally, I chose to buy a cheaper car for the simple reason that I realised that if I was going to be asked to service the damn thing, I wanted it to be affordable. The hon. Member for Wolverhampton South West is effectively seeking to govern the servicing arrangements.

Order. That was a very lengthy intervention.

Photo of Rob Marris Rob Marris Labour, Wolverhampton South West

Without straying too far, the Labour party was in favour of looking at a regulatory regime to cap energy prices; so now is the Conservative party. There is a role for the state when there is market failure. We are talking about potential market failure for very important safety items, not whether it is going to cost £100 or £200 to service a car and someone decides whether they buy a Rolls Royce, or whatever presumably less expensive car the hon. Gentleman bought—I cannot think that he would have bought a more expensive one. I understand the role of the market for that.

I am not looking to cap service charges, but there is an argument for the state putting a cap on the price of software updates, on safety grounds. The hon. Member for Wycombe referred earlier to parachutes. He can correct me on this, but I do not think that many people are killed in this country from someone’s parachute failing, besides that individual. What we are talking about here potentially is an individual whose parachute fails and who then lands on someone else and kills them. It is not just the owner of the vehicle; it is the rest of us.

Photo of Thomas Tugendhat Thomas Tugendhat Conservative, Tonbridge and Malling

The hon. Gentleman talks about safety-critical software. Brake pads are pretty safety-critical. If someone does not maintain their vehicle to a reasonable standard with proper brake pads, the vehicle is uninsurable. The same would be true in this case. If the manufacturer overprices the update, people will not buy the car. If people do not update the software, the car will be uninsurable and therefore undrivable.

Photo of Rob Marris Rob Marris Labour, Wolverhampton South West

The hon. Gentleman has a much more touching faith in the market than I do to resolve these things—that is why he is on those Benches and I am on these. That is fine, but in terms of the safety of all of us—he drives on the road, so do I; his family goes on the road, so does mine—I want a cap on safety software upgrade prices. The Minister should consider that, and it would go in clause 4.

Photo of John Hayes John Hayes Minister of State (Department for Transport)

I am going to be brief. I was in favour of a prices and incomes policy when even the Labour party had abandoned that. [Interruption.] I hear comments from behind me. I have been a protectionist all my life, and now it is coming back into fashion. The semantic points that the hon. Member for Wolverhampton South West made are good ones. As I said, we will take out the word “But”—as there are no ifs or buts with me, as yet. We will take a look at the other semantic points; there are bound to be those linguistic changes to a Bill.

The hon. Gentleman’s fundamental point was about the cost of software. If there was a catastrophic market failure—we are speaking about something down the line, as my hon. Friend the Member for Tonbridge and Malling said, for we do not know what the market looks like yet, but if we follow the hon. Gentleman’s advice we are already dooming it to failure—of course we would consider becoming involved. Were that to compromise the wellbeing of a large number of people who purchased automated vehicles, with all the consequences that might have, at some point the Government would need to take some kind of stand, but, if I may use an appropriate phrase, frankly I think we are at risk, Madam Deputy Speaker, of travelling roads as yet uncharted, let alone those we can reasonably foresee how we might journey down.

Photo of John Hayes John Hayes Minister of State (Department for Transport)

I will give way quickly, though I had produced a wonderfully eloquent summary.

Photo of Steven Baker Steven Baker Conservative, Wycombe

It was a wonderfully eloquent summary and I agree with a proportion of the Minister’s remarks, although not all of them. If we do end up in a position where safety-critical software updates to cars are both frequent and expensive, there will be a catastrophic market failure, and we will be banning automated cars and sending engineers back to college.

Photo of John Hayes John Hayes Minister of State (Department for Transport)

Exactly. I have nothing to add to that.

I thank the Minister for promoting me to the dizzy heights of Deputy Speaker.

Question put and agreed to.

Clause 4 accordingly ordered to stand part of the Bill.

Clauses 5 and 6 ordered to stand part of the Bill.

Clause 7