Before I ask the Clerk to read the title of the Bill, I should explain that in these exceptional circumstances, although the Chair of the Committee would normally sit in the Clerk’s chair, in order to comply with social distancing requirements I will remain in the Speaker’s Chair. However, I will be carrying out the role not of Deputy Speaker but of Chair of the Committee. We should be addressed as Chairs of the Committee, rather than as Deputy Speakers.
Clause 1
Trade functions: disclosure of information by HMRC
Question proposed, That the clause stand part of the Bill.
Thank you, Dame Rosie, if I have the nomenclature correct.
As we come to the end of the transition period, it is important that the Government make the best use of the information that they already hold to minimise any disruption that may result from the new border requirements that will apply irrespective of the nature of our trading relationship with the EU. More specifically, it is important that the Government use that information to develop a detailed picture of the flow of goods and people at key locations at the border. That will inform decision making right across Government, leading to better outcomes for businesses and citizens.
As Members will be aware, the clauses in the Bill have been scrutinised previously by the House during the passage of the Trade Bill. Members may recall that a key source of information within Government relating to both trade and border management is Her Majesty’s Revenue and Customs, which has significant responsibilities in relation to the movement of goods across the border. HMRC has specific statutory restrictions in relation to the sharing of information that it holds and, in the absence of an express legal gateway to permit sharing, the Government cannot make use of this data effectively.
The clause has therefore been introduced to allow HMRC to share the data that it holds with any other public or private body that carries out a public function related to trade for the purposes of that function. This power enables HMRC and bodies working with or on behalf of HMRC to share data with Departments, including, for example, the Cabinet Office, which, through the border and protocol delivery group, is leading Government preparedness for border readiness at the end of the transition period.
The BPDG has established a border operations centre to monitor and manage flow at the end of the transition period and to support relevant authorities to better manage border controls and ensure that frictions to the flow of trade are minimised and negative impacts are mitigated. The border operations centre will use data provided by HMRC, alongside other Departments and public bodies, so that it can analyse and promote efficiencies in the flow of traffic in goods and services in and out of the United Kingdom. Access to HMRC data is crucial to developing this detailed commodity-level view of the flow of goods at the border.
I am interested in clause 3. With whom are the Government concerned that the information might be shared inappropriately? Who would be the recipients of that information?
I think the hon. Gentleman’s question was about what kind of people would be inappropriate; it would be people to whom the legislation will not apply. We are talking about a discretionary power to share data to assist a Minister in functions relating to trade. In addition, the criminal power, as I understand it, is in the Bill specifically to prevent any individual person’s identity from becoming either known directly or deduced through the data that has been produced. Clause 3 puts in place an additional power to prevent that data from becoming known. I do not really want to speculate, Dame Rosie, but I can imagine a whole series of people and bodies that might have inappropriate access to an individual’s data as they pass through a border. I think we can all imagine the sort of people who might not have either your, mine or the Government’s best interests, or the interests of international trade, at heart.
Clause 4 contains the sunset elements of this Bill. As the House will be aware, the Trade Bill is currently passing through the other place and is now unlikely to receive Royal Assent before the end of the transition period. As I hope I made clear in introducing clauses 1 and 2, it is essential that we are able to provide a gateway to enable the sharing of trade-related data that the Cabinet Office requires before the end of this period as it takes on border-monitoring functions. To ensure that we can do that in time, the Bill replicates clauses 8 to 10 of the Trade Bill, which has been referred to at least twice so far. Clause 4 is therefore required to facilitate the expiry of clauses 1 to 3 of this Bill if similar clauses are passed in the Trade Bill, and will thereby ensure that the UK statute book is kept in good working order.
Clause 5 sets out the interpretation of key terms for the purposes of the Bill. Specifically, it provides interpretation of the terms “the data protection legislation”, “enactment”, “the investigatory powers legislation” and “Minister of the Crown”. The interpretations are intended to ensure that the reader of the Bill has clarity in respect of and understands the use of those terms in the Bill.
We recognise that at present there are limited circumstances in which Her Majesty’s Revenue and Customs can disclose information, such as when consent has been given by a taxpayer or when it is compelled to do so to comply with a court order. The Bill clearly continues that tight framing over the protection of information.
I have a few questions for the Minister, but I shall first comment on amendment 1. Although it is clear that amendment 1 aims to make watertight clause 2(8)—and I do understand the concerns behind that—Labour is satisfied that subsection (8) offers sufficient protection. However, I hope that the Minister can expand on that and explain what kind of instances subsection (7) might cover so that we can be fully assured on that point.
As we said earlier, this Bill is very much a lift of clauses 8 to 10 of the Trade Bill, although it diverges slightly by widening the protections in clause 2(8), ensuring that no disclosures made under this Act would
“contravene the data protection legislation, or…be prohibited by the investigatory powers legislation”,
rather than including specific references to the parts of the Investigatory Powers Act 2016 and the Data Protection Act 2018, as we saw previously. Will the Minister give us a reason for that change and let the House know what is now in scope that was not previously?
The Bill gives new powers to HMRC to share information with international bodies, local bodies, devolved Administrations and others for analysis and monitoring. Will the Minister elaborate on the purposes for which that might be done, more specifically? Perhaps he could also explain the way in which the border operations centre will use that data to support local authorities, local resilience forums and other key public services, such as hospitals and clinical commissioning groups, when transporting key medicines or vaccines during the pandemic.
Stewart Hosie (Dundee East) (SNP)
I wish to speak to amendment 1, tabled in my name, and to some of the other clauses.
During the passage of the incomplete Trade Bill there were, as the Minister will have seared into his soul, a number of debates and amendments—I think amendments 33 and 34—relating to the requirement to collect data by Her Majesty’s Revenue and Customs, specifically with regard to the exclusion of protection of legal professional privilege, which in many other circumstances would have applied. The same issue to some extent arises, in terms of the disclosure of information, in clause 2(7) of the Bill. It states:
“A disclosure under this section does not breach— (a) any obligation of confidence owed by the person disclosing the information, or (b) any other restriction on the disclosure of information (however imposed).”
The explanatory notes make it very clear that
“Certain information held by specific public authorities are subject to constraints on disclosure. To enable sharing of this information, clause 2(7) provides a general disapplication of these restrictions.”
If I may, I will just remind the Minister what was said in previous debates on this matter. Legal professional privilege and confidentiality are essential to safeguard the rule of law and the administration of justice. They permit information to be communicated between a lawyer and client without the fear of its going to a third party without the clear permission of the client. In normal circumstances, that includes HMRC. Many UK statutes already give express protection of legal privilege and it is vigorously protected by the courts.
We are in a rather odd position where data can be collected and is required to be collected, and where legal professional privilege has been disregarded entirely. We are now in a position where clause 2(7) disregards legal privilege in terms of the disclosing or sharing of that information. The Minister may well pray in aid some of the limited protections that are offered in clause 2, but if I run through them I suspect we might conclude they are not quite as strong as the Minister might like to think they are. The explanatory notes state:
“Clause 2(8) confirms that nothing in this section authorises the disclosure of information which would contravene data protection legislation or which is prohibited under the Investigatory Powers Act 2016.”
So far, so good—that is helpful, but very, very narrow. Others may say that it is only specified public authorities who can disclose or share information. They are specified in clause 2(3) as the Secretary of State, the Minister for the Cabinet Office, a strategic highways company, or a port health authority constituted in a particular way. However, clause 2(9) states:
I will not demand the Committee’s attention for long. Again, I find myself in agreement. The Liberal Democrats have serious reservations about the original Trade Bill, but we recognise that, through no fault of this House, the Bill has to be expedited. We need some form of data protection and for our authorities be able to use the data effectively, so we are prepared not to go along with this Bill, but to accept that we need it and that we need it by 1 January. We are in this situation simply because the negotiations with the European Union have not gone in the way that the Government had assured us they would, and because the situation has not been handled by the UK Government as expertly as we might have hoped.
I will, if I may, respond to those points. I thank Members for making them and for participating in this Committee debate.
Taking the points in turn, the hon. Member for Sheffield Central (Paul Blomfield) asked about instances covered by clause 2(7). As he noted, reference to investigatory powers legislation is absent from the Trade Bill. That is a minor drafting error. I should have made that clear. An equivalent change will be made to the Trade Bill in due course during its passage.
The hon. Gentleman asked a series of more general questions about borders and ports and I will try to answer those as best I can, recognising that almost all of his questions are within the remit of other Departments, rather than the Department for International Trade.
The hon. Gentleman asked how the border operations centre would assist the movement of medicines and vaccines. That will be a key part of the priorities that we have set for the border after 1 January, to ensure that vital goods continue to flow quickly and efficiently. I will give an example of the sort of data that would be within scope for the border operations centre, assuming that the Bill becomes law. The ability to analyse customs declarations, transit declarations, export declarations, safety and security declarations and things such as highways data would, I think, allow medicines and vaccines to be moved more quickly and more efficiently than would otherwise be the case without the data.
4:15 pm
The hon. Gentleman asked about the Department for Transport’s new ports fund, and he commented on how popular it had been; I welcome his welcome of the popularity of that fund. In response to his question, I am not aware of any specific ports, but ports are not within the direct remit of the Department for International Trade, so I will pass on his questions to the Department for Transport. We have cross-governmental discussions on ports readiness all the time, in particular between the border and protocol delivery group, the Department for Transport and the Cabinet Office. I can reassure him that those discussions are very frequent. In terms of the number of customs agents recruited, I will have to refer him to the Financial Secretary to the Treasury, in charge of HMRC, to answer his specific point.
I turn next to amendment 1, in the name of the hon. Member for Dundee East (Stewart Hosie). I would like to set out briefly why clause 2(7) is required and aim to alleviate any concerns he may have. As he rightly said, subsection (7) provides for a general disapplication of existing restrictions on the disclosure of information and applies only to Government Departments and public bodies listed in clause 2; I do not think he doubts for a moment that that is the case. It provides that restrictions on the disclosure of information will not apply when information is disclosed under clause 2(1).
Certain information held by the public authority specified in clause 2 has been identified for building up critical data from which insights may be derived regarding the flow of traffic, goods and services in and out of the United Kingdom. It is anticipated, however, that those insights are, in themselves, likely to highlight other areas where information is needed in order to provide as complete a picture as possible of border flows and activity relating to trade. As Members will be aware, further public bodies may therefore be added to the gateway through the delegated power in clause 2(9). It is not possible at this stage to anticipate what specific restrictions may apply to those additional public bodies, and therefore a general disapplication of restrictions is appropriate, in the light of all the other protections on the face of the Bill.
Removing subsection (7) would limit the information capable of being disclosed to the Cabinet Office and would ultimately impact the Government’s ability to mitigate disruption to the flow of traffic, goods and services at the border. I should stress that the Government take the protection of data held by Departments, public bodies and private companies acting on their behalf extremely seriously. As I have said, the gateway is permissive. It does not mandate that bodies listed in clause 2 must share information. Individual Departments and public bodies will need to be satisfied that data sharing is necessary to support functions relating to trade.
Stewart Hosie
If the Minister is right that removing the disapplication would restrict the Government’s ability to collect the data they need, will he tell the Committee what data that is currently protected the Government wish to access or have a hold of that they would not otherwise be able to get?
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Additionally, the clause will facilitate the sharing of information with other organisations, such as the World Trade Organisation and the World Customs Organisation, both of which the UK will be obligated to share data with as part of our international obligations for the purposes of trade. This is a necessary clause to ensure continuity as we come to the end of the transition period, as it will enable the efficient use of HMRC data to support the Cabinet Office’s role in minimising temporary disruption at the border that may result from our new trading relationship with the EU and enable the sharing of data with international organisations where necessary.
Measures have been included in the Bill to ensure the proper handling of the data and to safeguard and protect its use, with penalties for unauthorised disclosure, onward sharing or use. Moreover, Departments will comply with requirements of data protection legislation, including the general data protection regulation, when handling any personal data shared under this gateway, where it is deemed proportionate and necessary to do so. This clause is essential for the Cabinet Office and other bodies to ensure the continued smooth flow of goods.
Let me move on to clause 2. Alongside HMRC, to which clause 1 applies, more than 20 Departments and public bodies have either operational or policy responsibilities relating to the border, using over 100 IT systems between them. These Departments and public bodies collect and hold numerous types of information related to trade. However, as with HMRC, this information could typically be used only for very specific purposes, with statutory restrictions on the sharing of information with other Departments. These restrictions inhibit the Government from identifying and utilising the full potential of their information to support trade policy and the flow of goods and services through the border. The restrictions also lead to inefficiencies, including duplicative requests to industry to share data.
The clause fixes that problem and will allow specified public bodies and Departments to share data where it supports the exercise of a Minister of the Crown’s functions relating to trade. By combining and analysing specific border data, the Government and the Cabinet Office, in particular, will be able to develop insights and analysis to support the Government as a whole to deliver better services. This will ensure that goods and trade to continue to flow when the UK becomes an independent trading nation at the end of the transition period. As with clause 1, this clause does not, however, grant any additional data collection powers to the Government. Instead, it seeks to create a discretionary gateway to enable more effective sharing of data that Departments and public bodies already hold.
Let me move to clause 3. The Government rightly take the safeguarding of information and personally identifiable information, in particular, very seriously. As I hope I made clear in introducing clauses 1 and 2, the ability to share data through both gateways is discretionary. Individual Departments and public authorities providing data will need to be satisfied that data sharing is necessary to support functions relating to trade prior to sharing the data. Furthermore, as I mentioned when introducing clauses 1 and 2, any data shared by the data-sharing gateway that is being established will have to comply with data protection legislation, including the general data protection regulation and its principles, covering necessity, proportionality and minimisation to protect the rights of individuals.
Clause 3 provides an additional safeguard on top of all the others by creating a criminal offence if information relating to a person’s identity, or information from which a person’s identity might be deduced, is shared in contravention of clause 2. I hope that will provide further assurance, if it is required, that the data shared through the gateway will be handled appropriately.
Finally, Clause 6 sets out the territorial extent of the legislation, when it will come into force and its short title. Subsection (1) sets out the territorial extent of the provisions:
“This Act extends to England and Wales, Scotland and Northern Ireland.”
This is a standard clause in any Bill to specify the extent of its measures.
I note that the Government have worked closely with the devolved Administrations on these provisions as part of work on the Trade Bill, to ensure that the data- sharing gateways can also assist them with their devolved functions—I have already mentioned traffic management around ports as a classic case of where a devolved Administration have a legitimate and correct interest in ensuring that data will flow and therefore that trade flows. In that spirit of working closely together, the Government made two commitments to the devolved Administrations in relation to data sharing under clause 9 of the Trade Bill when it was in Committee in the Lords, and I will repeat them today. First, the data shared under clause 9 of that Bill will be used by the border operations centre and the Cabinet Office to develop strategic insights. The Cabinet Office is committed to sharing strategic analysis related to the flow of data where it will support the more effective management of flow through the border. Cabinet Office officials will continue to work closely with counterparts in the devolved Administrations to ensure that relevant analysis and information can be shared to support devolved functions relating to trade and management of the border. Secondly, the UK Government commit to consulting the devolved Administrations before any devolved authorities are added to or removed from the list of specified authorities that can share data under clause 9 of the Trade Bill.
I turn to the remaining subsections of clause 6. Clause 6(2) of the Trade (Disclosure of Information) Bill provides for the Bill to come into force on the day of Royal Assent. Clause 6(3) simply provides that the Bill, once enacted, will be cited as the Trade (Disclosure of Information) Act 2020. I hope that the House agrees that clause 6, and therefore all six clauses, should stand part of the Bill.
A little more broadly, I wonder whether the Minister could give other details about the border operations centre and the Government’s preparations for the end of the transition period. For instance, after the awarding of the port infrastructure fund yesterday, what assessment has he made of the number of ports that consider their allocation of the fund adequate to cover the necessary infrastructure changes required by the border operating model? As that fund was so significantly over-subscribed, what discussions is the Minister having with the Cabinet Office to ensure that our borders are fully operational by 1 January?
There is another point on which many of my colleagues and I have pressed Ministers. I do not think that we have had the opportunity to press this Minister on it, though, so I will give him a chance to answer. Can he tell us how many customs agents of the 50,000 recommended by the Government have now been trained and recruited? Will he also give us an update on the IT systems required to process customs and support our borders after the transition? Data sharing under the powers of the Bill is clearly welcome, but we also need the systems that sit alongside it to enable us to minimise disruption.
The Bill is needed to allow public bodies to access information about their areas and to prevent disruption. It also contains useful protections regarding data sharing, but it is a drop in the ocean when it comes to preparedness for the end of the transition period, so I hope that the Minister can answer some of those additional questions and give not simply this House, but business, the reassurance that it needs.
“A Minister of the Crown may by regulations made by statutory instrument amend this section for the purpose of specifying a public authority in, or removing a public authority from, subsection (3).”
Therefore, any number of other bodies could be added to that list. The other protection one could point to would be to say, “Ah, but they can be added if they are dealing with functions relating to trade.” They include
“the analysis of the flow of traffic, goods and services...the analysis of the impact, or likely impact, of measures or practices…the design, implementation and operation of such measures”,
and so on. Those three specifics, however, are prefaced by:
“Those functions include, among other things, functions relating to”.
That allows it to be completely open-ended. It is not a comprehensive or complete list. As anyone watching will know, trade is no longer simply about traffic flows, the number of containers, quota and tariffs. It is about a whole range of things: all sorts of regulations, security, immigration and goodness knows what.
The provision is vague and ill-defined. It strikes me as being subject to scope creep by regulation. Fundamentally, it includes clause 2(7)(a) and (b), which is a get out of jail free card insofar as it disapplies the normal protections of information being disclosed, which would be subject in many other circumstances, including in statute, to legal professional privilege. That is actually a problem in the long run, but not necessarily in the short run as it allows us to get over an immediate hurdle where data must be shared. I appreciate that but, in the long run, how on earth can we say that we are a law-abiding country and that we want to adhere to the international legal system—the rule of law internationally—when we have here the disapplication of fundamental rights and protections for people not to have their information, normally subject to legal protection, shared, collected, distributed and disseminated. When the hon. Member for North East Bedfordshire (Richard Fuller) asked whether a private body could act as a public authority, the answer seemed to be that, yes, it could. That means that we could have a private body—a private company of indeterminate origin and a very small book value—doing something on behalf of the public, acting as a public authority, where the normal protection of data, which it may be provided with to fulfil its role, has the normal protections of legal privilege disapplied in statute.
Time is short. I know that this is urgent—I am not stupid— but this is actually serious. We cannot have a Government riding roughshod over legal protection, legal privilege, in this way over such a short period of time just because they have failed to get their ducks in a row and a proper functioning Trade Bill through where everything joins up.
It is not my intention, Dame Rosie, to press amendment 1 to a vote, but I do hope that the Minister takes seriously what I have just said and understands the possible consequences, particularly if it is private bodies acting as public authorities which have disapplied from them everything in terms of protection other than data protection and whether it would breach one other piece of named legislation. That is a serious and bad place to be.