Latest Public Sector News

14.02.17

Councils banned from boycotting suppliers after Israel scandal

Councils will now be legally forbidden from boycotting companies and countries unless restrictions have already been put in place by central government, new DCLG plans have outlined.

The move, which will force councils by law to stop locally-imposed boycotts and treat all suppliers fairly and in line with government policies, comes after the widely-reported case last year where three local authorities were brought to court over alleged anti-Semitism.

Leicester City Council, Swansea City Council and Gwynedd Council were brought to court by charity Jewish Human Rights Watch after all three had imposed boycotts on Israeli goods. The charity had launched a judicial charge against the three authorities for discrimination, but these claims were later dismissed by the High Court in June 2016.

Senior government figures had already revealed early last year that a crackdown was underway to stop public bodies from launching town-hall boycotts against goods and services from companies involved in arms trade, fossil fuels, tobacco products or Israeli settlements in the West Bank.

While the government claimed these boycotts “undermined good community relations, poisoned and polarise debate and fuelled anti-Semitism”, critics of the move said it translated to a “gross attack on democratic freedoms”.

A spokesman for Labour leader Jeremy Corbyn MP said last year that plans to ban councils from divesting from trade they regard as unethical would be an “attack on local democracy”. His office argued people have the right to “elect local representatives able to make decisions free of central government political control”, which includes the “withdrawal of investments of procurement on ethical and human rights grounds”.

Despite this, rules were introduced last year which prevented councils from using local government pension policies to introduce boycotts, with Cabinet Office guidance also published to steer the procurement of services by public bodies.

But the ruling formally announced today will make all local councils subject to the ban, and would make following the government’s foreign policies a legal requirement when buying goods and services, “effectively outlawing locally-imposed boycotts”.

The DCLG said this decision follows rules set by the World Trade Organisation requiring all member countries to treat suppliers equally and without prejudice.

Communities secretary Sajid Javid added: “We need to challenge and prevent divisive town hall boycotts which undermine good community relations.

“No council should be boycotting any company or country unnecessarily – instead their main focus should be delivering the value for money taxpayers rightly expect. We will clampdown on these inappropriate and needless boycotts once and for all.”

The government’s statement on this decision specifically highlighted Israel as an example of particular note, but made clear that councils will not be able to “discriminate on geographical or other grounds”.

Javid has also confirmed that he will look to put the government guidance published last February on a legal footing, in order to make clear that boycotts should not take part in council procurement decisions.

“Similar boycotts have led to the removal of Kosher food from the shelves of supermarkets, or calls for Jewish films to be banned,” said the DCLG in a statement. The communities secretary will also be able to intervene if a council is in breach of the regulations or statutory guidance.

PSE approached the LGA for comment but did not hear back in time for publication.

 

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