My Lords, it is a pleasure to follow my noble friend Lady Hayman after her remarks. I apologise to the Committee for being a few minutes late; I was unavoidably detained on other business. I also thank the noble Lord, Lord True, for dealing with a really difficult situation with—as we might all agree—his normal courtesy. I think it was the best that could be done in the circumstances; withdrawing government Amendment 1 allowed us to move to this group of amendments. We all appreciate his offer of continuing discussions in the next day or so to consider how we take all this forward. It would be remiss to not start with thanks to the Minister for that, otherwise the Committee would have been a complete and utter catastrophe. As we can see, however, with this group of amendments we have got on to the real purpose of the Committee, which is to get to the real detail, as seen in the various contributions made by all noble Lords. All the amendments put forward have asked very reasonable questions, which seek to clarify the Government’s intentions. I shall certainly make those points in the few minutes that I speak for.
I start by saying that I was really interested in the amendment of the noble Baroness, Lady Noakes, because it goes to the heart of the issue. You can read “pecuniary” in all sorts of ways. I looked it up with the help of my noble friend Lady Hayman and it has to do with money, so I was quite pleased to read that—from a non-legislative point of view—because I thought it meant that it was about the supply of the contracts, the pecuniary interests would not matter and it was a “standards in public life” type of approach, but of course it is not. The amendment of the noble Baroness, Lady Noakes, has clarified that for me. What “pecuniary” means in this context is a really interesting point: why are the Government including it and why would the amendment of the noble Baroness, Lady Noakes, not be an improvement? Again, the details of some of these amendments are really worthwhile points to look at.
I wanted to raise some of the points that the noble Baroness, Lady McIntosh, started to get to in the debate on whether Clause 2 and Schedule 2 should stand part. There is also the question of where Schedule 1 takes us. The noble Lord, Lord Fox, will be interested in this, having asked who will police this. The Government use the term “estimated value” in Clause 2 and, to be fair to them, that is very important for this aspect of a public contract. Clause 3 deals with how estimated value is worked out; then, in Schedule 3, it is done by regulation. Schedule 3 lays out how the estimated value may be set, so I will not go through it. What I could not find out—a point also made by the noble Lord, Lord Fox—is who ensures that it is properly done; in other words, that the estimated value is a proper estimated value and that the system laid out in Schedule 3 works. If I understood the Minister, he said that it is a matter for the Minister—a matter for the Crown. Could he just clarify who polices this? Who ensures that the estimated value is indeed a proper estimated value? That would be helpful to the Committee.
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In Schedule 1, as the noble Baroness, Lady McIntosh, and the noble Lord, Lord Lansley, pointed out, it is all laid out for the purposes of public contracts. Where have all these threshold amounts come from? I think the noble Baroness, Lady McIntosh, said that they were in the EU legislation in euros and that all we have done is convert them into pounds. I do not know whether that is true, but how have those threshold amounts been worked out to be the appropriate ones for each of the contracts in the 12 circumstances laid out in the Bill? It is really important to know how these amounts have been arrived at.
How these amounts can be changed will be set out by regulation. But as we will hear later, the Delegated Powers Committee report—I hope the noble Lord, Lord Wallace, does not mind me referring to it—is very worried about the use of regulations. Can these thresholds be moved up or down—presumably the Minister decides that? Can the Minister confirm whether these thresholds can be moved up or down by negative or affirmative procedure? I think it is negative, but I will be corrected if I am wrong. I would have thought that, as we are debating whether Schedule 2 stand part of the Bill, changing these threshold amounts—which are crucial to the determination of whether a public contract is awarded because it is above or is exempt because it is below—would be very important from that perspective.
I cannot find anything in the Explanatory Memorandum setting out the reasons for that or in what circumstances these thresholds could be changed. I am a pretty reasonable man. If the Minister turned around and said that it is laid out that it will be an inflationary increase according to whatever, that would be fairly reasonable, to be honest, but suppose that someone had another reason. We need greater clarity on that.
We have all sorts of use of regulations in Schedule 2. Can the Minister say something about how all these different bodies were arrived at? We have a list of all the various contracts which will be exempted—I
understand that some are defence and security contracts. How was this list arrived at? It would be useful to know the criteria used to determine that these are the appropriate contracts to be exempted from the provisions of the Bill. I think the Committee would find that helpful to understand.
We are discussing whether Schedule 2 stand part, and we will discuss this in more detail when we come to the debate on group 5 and the amendments from the noble Lord, Lord Wallace. Page 10 of the Delegated Powers and Regulatory Reform Committee’s report on the Procurement Bill specifically gives an example of where the committee is worried about the use of regulations and the inability of Ministers properly to explain the power they are giving themselves.
The committee uses as an example
“paragraph 17 of Schedule 2—power to exempt from regulation under the Bill contracts for the provision of public passenger transport services”,
but there will be others. It states:
“According to the Memorandum, this power is being taken because … procurement for public passenger transport services by rail and metro is to continue to be regulated by separate legislation and reflecting this in the Bill would be problematic because it ‘would involve provision for a number of complexities in UK legislation and retained EU law and how they interact’; and … the regulation of such services is to be ‘the subject of forthcoming changes’… However, it does not explain why it is considered appropriate for the power to be so broad that the issue of which kinds of contracts for the provision of ‘public passenger transport services’ are to be exempted is left entirely to regulations.”
There is nothing of substance in the Bill which explains any of it. There is real concern about that.
It also states:
“Example 5: paragraph 34 of Schedule 2—power to exempt from regulation under the Bill concession contracts for air services provided by ‘qualifying air carriers’ specified in regulations”.
The Government have failed to provide any justification for leaving entirely to regulations the question of which concession contracts for air services provided by air carriers are to be exempt from the Bill. We will come to this later but, in Schedules 1 and 2, there are numerous powers given to the Minister, through regulation, to determine real issues of policy.
To conclude on this, later on, the report is scathing in its criticism of one of the powers that the Government are taking to allow them to change primary legislation through negative secondary legislation. That cannot be right. We cannot expect secondary legislation to change primary legislation through the negative process, although admittedly that happens in another part of the Bill. Can the Minister confirm that nothing we are passing in Schedules 1 and 2 will allow the Minister, through negative secondary legislation, to change primary legislation? That is the only example the committee gives but are there other examples, specifically with respect to Schedules 1 and 2? I know that the Minister will seek to answer these questions but this goes back to the points made in the amendments from the noble Lord, Lord Lansley, the noble Baroness, Lady McIntosh, and other noble Lords, such as my noble friend Lady Hayman.
At last, now that the process is starting to be sorted out, the Committee can start doing its job, whether that is in the amendment of the noble Baroness, Lady Noakes, or in any other amendment. We seek to
scrutinise the detail of the Bill to understand what is going on. The purpose of the Committee is to improve the legislation and make it work, even if sometimes there is an ideological clash about some of it. Everybody wants this Procurement Bill to work because having a better system of purchasing that conforms to the standards we all want is in everybody’s interest. It is in Committee that we can examine the detail in order to do that.