Lords Test Steel Takeover Powers, Extend Carbon Budgets' Scope

High-Level Summary

The House of Lords undertook a wide agenda of questions, statements and legislation, covering technology procurement, Covid-19 fraud recovery, food security, construction skills, asylum appeals reform, media policy, NHS maternity safety, steel nationalisation powers and climate regulation. Ministers outlined contractual safeguards around Palantir’s public contracts, progress and next steps on Covid counter‑fraud work, and a funding package to train more construction workers. A Private Notice Question previewed a Bill to establish an Independent Immigration Appeals Authority to tackle a large appeals backlog. Peers scrutinised the Steel Industry (Nationalisation) Bill in Committee, testing the scope of the public interest test, value‑for‑money, devolution and delegated powers, while climate regulations bringing international aviation and shipping into carbon budgets were approved after a regret amendment was withdrawn; other statutory instruments were also agreed.

Detailed Summary

Palantir: Public Service Contracts – Question

Baroness Chakrabarti asked about human rights and reputational risks in public contracts with Palantir. Lord Coaker said departments “operate within a robust procurement and assurance framework” and emphasised that contracts are with Palantir UK, adding: “we retain full ownership and sovereign authority over all defence data”. He noted an agreement between the Mayor of London and the Metropolitan Police Commissioner for a 12‑month Palantir proof‑of‑concept: “a 12‑month period to establish a proof of concept”. On NHS use, he cited that “more than 100,000 extra patients have been seen” via the federated data platform.

Challenged about a reported £240 million single‑tender Ministry of Defence contract, he said officials advised Palantir was “the only available platform” and that use of a single‑tender route was lawful in such circumstances. He said the Government would seek future competition, including from small and medium‑sized firms, “so that we have a competitive process in future”. On applying a “fit and proper” test, he said contractors “have to have a fit and proper process” and pass risk assurance, adding that refusing Palantir would also have consequences: “many patients now being seen would not be seen”.

Covid Fraud – Question

Lord Livermore said the Government’s formal response to the Covid Counter‑Fraud Commissioner’s report was laid on 23 June, with a plan to pursue fraud and strengthen controls. He stated that, of 22 recommendations, the Government “have fully accepted 18 and partially accepted the remaining four”, and that the Treasury would establish a Minister‑chaired scrutiny panel to review implementation every six months for at least two years.

He acknowledged evolving fraud threats raised by peers, while saying of one characterisation that “I am not sure that I fully accept it is becoming as overwhelming” and noting Financial Conduct Authority action. On Companies House changes, he confirmed implementation would be delayed by a year to April 2028 and that small companies and micro‑entities would “have the option to opt out of publishing their profit and loss information” on the public register. He said PPE Medpro Ltd “is now in liquidation” and that recoveries are for the liquidators. On quantum, he told the House that £10.9 billion was lost to fraud and error, £1.6 billion had been recovered and a further £1.5 billion was being repaid, with limitation periods extended by six years.

Food Security – Question

Lord Katz said the UK has “a secure and resilient food system” and that Defra lays a UK Food Security Report every three years, with the next in 2027 and shorter digests in between. He highlighted measures in the Government’s new farming road map and support for food manufacturers, including funding “£25 million from Defra and nearly £50 million from UK Research and Innovation”. He described the scope of reporting and confirmed “a record £11.8 billion” for sustainable farming over the Parliament, noting the food sector “is one of the UK’s 13 critical national infrastructure sectors”.

On affordability, he said “UK annual food price inflation in the current month, June 2026, was 2.2%” and pointed to extending free school meals “to 500,000 extra pupils” and targeted tariff cuts on over 100 items. Responding on land use, he said that even under ambitious scenarios solar farms would occupy “only 0.4% of total UK land and up to 0.6% of total agricultural land” and argued for balancing clean energy and farming.

Construction Sector: Skills Shortage – Question

Baroness Smith of Malvern outlined “a £625 million investment to train up to 60,000 more skilled workers in construction”, including £100 million for skills bootcamps and £100 million for 10 construction technical excellence colleges. She emphasised improved careers education and targeted communications to raise awareness of construction careers, including for women and returners.

Support for SMEs includes “a new apprenticeship hiring payment of £2,000” for 16‑24 year‑olds, fully funded apprenticeship training for eligible small businesses, national insurance reliefs, and CITB support. She cited the role of procurement, with the Department for Education estates strategy expecting “8,000 additional training places” as a result of investment. She said the Government aims to “increase by 50,000 the number of young people starting apprenticeships” and noted new provision such as a unit in “solar PV installation”.

Immigration and Asylum: Appeals – Private Notice Question

Lord Hanson said the Government would bring forward legislation to create a new independent immigration appeals authority to tackle a backlog of 151,767 cases with average waits of 61 weeks. He said the new body would use “suitably qualified adjudicators independent of the Executive” and that recruitment would include vetting and safeguards to ensure high standards and independence.

Pressed on qualifications and training, he said adjudicators would be professionally trained and the body would be independent, with details in the imminent Bill. He added that members would receive a “comprehensive training programme” and that governance would follow the Cabinet Office’s Public Bodies Handbook.

Business of the House – Announcement (National Security (State Threats) Bill)

Lord Kennedy of Southwark announced that “Committee and all remaining stages will take place tomorrow” for the National Security (State Threats) Bill, with issues to be resolved in Committee and Divisions there if needed. If unamended, “we will proceed to a formal Report stage and Third Reading”, after which the House would take a related statutory instrument and a Statement on steel trade measures. He also set out contingency timings if amendments are tabled.

Statutory Instruments – Planning and Nuclear Safeguards

The House approved the Planning and Infrastructure Act 2025 (Consequential Amendments) Regulations 2026 and related Order (“Motions agreed.”). It also approved the Nuclear Safeguards (EU Exit and Fees) (Amendment) Regulations 2026; Baroness Wheeler moved the Motion on behalf of Lord Vallance and the “Motion agreed”.

Media Green Paper – Commons Urgent Question (Lords exchanges)

Ministers answered questions on the Green Paper Watch this Space. The Government proposes digital prominence, “exploring legislative options to require social media platforms and connected TV interfaces to make public service media content… highly visible”; a managed switchover to internet TV, “consulting on two dates for the switchover: 2034… or 2044”; and extending listed events to on‑demand rights.

On how prominence would treat different outlets, the Minister said it “would depend whether the item… was opinion purporting to be fact or more factual”. Asked about the BBC World Service, she cited ministerial engagement and described it as “a light on the hill”. She said criteria for trustworthy news providers would be decided in an “open and transparent manner” through consultation.

Nottingham Maternity and Neonatal Services – Statement (with Lords questions)

The Commons Statement relayed to the Lords said Donna Ockenden’s review uncovered “dangerously and tragically deficient care” over 13 years, with appalling culture and treatment of families. Immediate steps include expanding Martha’s Rule to all maternity and neonatal settings so parents can seek a rapid review and using the forthcoming Hillsborough law’s duty of candour to compel evidence in upcoming reviews in Leeds and Sussex. The Human Tissue Authority will require mortuaries to review incident records going back 10 years and report by 16 October.

In the Lords, the Minister apologised “on behalf of the Government”, said the taskforce would “deliver a clear and deliverable plan by the end of the year” with milestones and transparency, confirmed “extending Martha’s rule straightaway to all maternity and neonatal services”, and outlined actions on mortuaries.

Steel Industry (Nationalisation) Bill – Committee (1st Day)

Peers scrutinised definitions, the public interest test, valuation, workforce rights, devolution, sunsetting and delegated powers. Ministers opposed narrowing “steel undertaking” to those “predominantly” engaged in steel‑making, arguing the test “immediately raises difficult questions” and risks loopholes. The Government reiterated it is “strongly minded to use the powers to acquire British Steel if it is in the public interest to do so” and had “no plans to acquire any other steel undertakings”.

Amendments to confine or redefine the public interest test were rejected; Ministers said “supporting the economy” is deliberately broad and future‑proofed. Calls to mandate a statutory value‑for‑money test were resisted on the basis that “taxpayers’ money must be spent wisely” and existing Managing Public Money disciplines already apply. Proposals to hard‑code local economy duties, tariff or electricity‑price assumptions into valuation, or to confer selective advantages on a public operator, were declined: valuers would consider the market context and any support would be “time‑limited, targeted and proportionate”. A bid to empower Ministers to prohibit industrial action at a nationalised undertaking was rejected: the Government “do not believe that curtailing workforce rights is either necessary or the right way” and stressed partnership with staff.

Ministers undertook to “consider options for Parliament to scrutinise decisions” at or after any transfer ahead of Report, confirmed they would “ordinarily consult” devolved Ministers and noted Scottish consent had been granted. An amendment to bar extensions of the Bill’s two‑year sunset was resisted to preserve flexibility (with any extension by affirmative procedure). Peers sought to upgrade several regulation‑making powers and restrict Clause 50; Ministers cited the need for speed and complexity, describing the modification power as “targeted and limited”, while agreeing to look again at scrutiny of enforcement provisions.

Climate Change Act 2008 (International Aviation and International Shipping) Regulations 2026 – Motion to Approve

The House approved regulations to include the UK’s share of international aviation and shipping emissions in the sixth and subsequent carbon budgets and the 2050 net‑zero target. The Minister said the instrument “makes the necessary regulations… to include emissions” from these sectors and “does not alter the stringency of the UK’s climate targets” or set sector‑specific limits. Methodology will be finalised before the sixth carbon budget period in line with international practice.

In closing, the Minister said methodology must be agreed with the international aviation and maritime bodies and that he did “not agree that ETS is a method of tax raising. It is in the form of a tax, but it works with the market”. A regret amendment was withdrawn and the Motion agreed.